EPA Issues Guidance on PSD Permit Processing

Posted Wednesday, November 28th, 2012

Contact: Joseph Brown

On October 15, 2012, the U.S. Environmental Protection Agency (“EPA”) issued a guidance memorandum addressing the timely processing of prevention of significant deterioration (“PSD”) permits.   The guidance only addresses EPA PSD permit processing procedures, and does not apply to PSD permits issued by the Florida Department of Environmental Protection (“DEP”).  Thus, the guidance is only significant for Florida because EPA is responsible for issuing greenhouse gas (“GHG”) PSD permits in the state – Florida is the only EPA Region 4 state that does not issue PSD permits for GHGs.

EPA issued the guidance essentially to limit the import of Avenal Power Center, LLC v. EPA, 787 F.Supp.2d 1 (D.D.C. 2010), which held that EPA must issue a final permit decision (including any administrative appeal process to EPA’s Environmental Appeals Board) within one year of determining a permit application is “complete.”  Avenal is also significant because, following the decision, EPA ultimately issued a final permit that “grandfathered” the facility from regulations that became final before the permit was finalized.

Thus, the guidance demonstrates an intent to extend the pre-completeness determination review process (i.e., extend review prior to starting the one-year clock addressed by Avenal).  For example, it explicitly states that information needed to review compliance with the Endangered Species Act, the Coastal Zone Management Act, the National Historic Preservation Act, and the Magnuson-Stevens Fishery Conservation and Management Act should be treated as requirements for a completeness determination.   And, although the guidance states the permitting authority “should strive” to determine completeness within 30 days of receiving an application, if additional information is requested, there is no deadline for then determining completeness.

The guidance also states that all regulations that become final before the permit is finalized must be addressed and included in the permit (a position directly opposite to the precedent set by the Avenal final permit).  This applies whether the regulation becomes final before or after the application is determined to be complete.

Moreover, the guidance states that if a new requirement becomes applicable after an initial completeness determination, EPA will consider the application incomplete until the new requirement is addressed (ostensibly resetting the one-year clock for final action following a completeness determination).  The guidance further states that “substantial” changes to the application will be treated as a new application, also resetting the one-year clock.  There is no definition of “substantial,” although the guidance cites as examples the addition of new units/processes and revised modeling to correct emission rate calculations and erroneous stack exhaust parameters.

Finally, also of note, the guidance addresses denial of PSD permits.  This suggests EPA may be more apt to deny permits in the future, which, in EPA’s own words, “is not an approach that the EPA has traditionally taken.”


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