Regulatory Activity Related to Air Emissions from Petroleum Refineries

By Brett S. Henrikson

Starting October 1, 2005, Bay Area refineries face new wastewater collection and reporting requirements. Regulation 8, Rule 8 of the Bay Area Air Quality Management District was adopted on September 15, 2004, to reduce air emissions from wastewater collection systems by focusing on transportation and separation equipment. The Rule is found here: http://www.baaqmd.gov/dst/regulations/rg0808.pdf BAAQMD has issued an advisory to assist refineries in meeting the upcoming deadlines. The Advisory is available at:
http://www.baaqmd.gov/enf/compliance_assistance/advisories/adv_091405_refinery_wastewater.pdf
Rule 8-8 is not the only recent regulation on Bay Area refineries. Just 2 months ago, BAAQMD issued a new rule regulating emissions from refinery flaring. Petroleum refineries use flaring for the safe disposal of gases generated during the refining process. BAAQMD originally identified refinery flaring as a potential regulatory target in the San Francisco Bay Area 2001 Ozone Attainment Plan. New Regulation 12, Rule 12 governing refinery flaring can be found here: http://www.baaqmd.gov/dst/regulations/rg1212.pdf and further regulatory history, including the BAAQMD Staff Report and Environmental Impact Report, can be found here: http://www.baaqmd.gov/pln/ruledev/regulatory_public_hearings.htm The Bay Area 2001 Ozone Attainment Plan can be found here http://www.baaqmd.gov/pln/plans/ozone/2001/index.htm.
Air emissions from petroleum refineries will also be the target of federal regulators in the coming months. As part of a proposed Consent Decree, U.S. EPA has committed to update the New Source Performance Standards for petroleum refineries. Section 111 of the federal Clean Air Act (42 U.S.C. § 7411) requires U.S. EPA to establish initial NSPSs for certain industrial classes that contribute significantly to air pollution. http://www4.law.cornell.edu/uscode/html/uscode42/usc_sec_42_00007411----000-.html U.S. EPA generally must also review an existing NSPS every 8 years to determine if updates are necessary. U.S. EPA has not reviewed the NSPS for petroleum refineries since 1974. Under the terms of the settlement agreement, EPA must propose revisions to the NSPS (40 CFR Part 60, Subpart J) within 18 months, with the final rule due within 30 months. http://www.access.gpo.gov/nara/cfr/waisidx_05/40cfr60_05.html
The lawsuit leading to the settlement is Our Children's Earth Foundation, et al. v. U.S. EPA, Case No. C05-00094 (N.D. Cal.). The settlement agreement was published in the Federal Register on August 29, 2005 (70 Fed. Reg. 51040).

SBREFA

Have any of you had any experience using the Small Business Regulatory Enforcement Fairness Act (SBREFA) as a tool in settlement negotiations with federal agencies? The act has a provision regarding civil penalties that states:

Each agency regulating the activities of small entities shall establish a
policy or program within one year of enactment of this section to provide
for the reduction, and under appropriate circumstances for the waiver, of
civil penalties for violations of a statutory or regulatory requirement by a
small entity. Under appropriate circumstances, an agency may consider
ability to pay in determining penalty assessments on small
entities.

EPA has implemented this statute through a handful of self-reporting policies (see this report), but it seems to me that the statute also expresses a Congressional policy that might be useful in negotiations with EPA or other federal agencies. I would be very interested in anyone's experience in this regard.