Climate: ANPR, SIPs and Section 821 WESTAR October 2, 2008

CO2 Sequestration Rule (EPA Office of Drinking Water) Federal Requirements Under the Underground Injection Control (UIC) Program for Carbon Dioxide (CO2) Geologic Sequestration (GS) Wells  Proposed July 25, 2008  Comments due November 24, 2008

ANPR Basics An ANPR is used to obtain more information and solicit public input on possible regulatory approaches before deciding whether/what to propose The GHG ANPR -Represents EPA’s next step in responding to Mass v. EPA -Reviews and summarizes available science on climate change and its effects -Reviews work to date on potential motor vehicle GHG standards under CAA -Examines interconnections among CAA provisions -- regulation of GHGs under one provision could or would lead to regulation under other provisions -Examines implications of applying particular CAA authorities to GHGs and provides a comprehensive, in-depth exploration of the opportunities and challenges application of CAA authorities would present -Asks detailed questions on a wide range of policy, legal and technical issues and approaches - Solicits technical information and data Signed by Administrator July 11, 2008  Published on July 30 (Permitting Section is at 73 FR )  Public comment period open until November 28

PSD Implications PSD program applies to pollutants regulated under any CAA authority with the exception section 112 or section 211(o) PSD requires preconstruction review and permitting for new major emitting facilities and modifications (i.e., significant increases) at existing major emitting facilities Major source thresholds for PSD program--  100 tpy for categories listed in the CAA  250 tpy for other categories Significance levels up to 100 tpy for current pollutants.

PSD ANPR Discussion Applying these thresholds to GHGs would increase the number of PSD permits by at least an order of magnitude -- from per year to thousands of PSD permits each year For GHG, would potentially cover many small sources (e.g., large residential/commercial bldgs.) and many small modifications at traditional major sources. Substantial expansion of PSD raises serious concerns (BACT, delay, etc.) and questions (e.g., whether any benefits could be achieved more efficiently through approaches other than case- by-case review)

PSD – ANPR Options ANPR takes comment on options to restrict the program to larger sources and/or to streamline compliance for GHG sources added to the program, such as:  Set higher major source thresholds for GHGs  Set higher significance levels for GHGs  Phase in the program slowly, starting with large sources  Reduce the number of additional small sources that need PSD permits through limitations on, or interpretations of, sources’ “potential to emit”  Streamline the permitting of such sources though a range of approaches (presumptive BACT, general permits) Legal theories presented for comment  Administrative Necessity & Absurd Results

Title V Permit Program Discussion Title V operating permits also affected by GHG  Title V consolidates air pollution control requirements into one permit; requires monitoring, reporting, certification, etc.  Required for new and existing sources above 100 tpy (and other sources as well)  If the 100-ton major source threshold were applied to GHGs, this would substantially increase the number of sources required to obtain Title V permits  Could be more than 500,000 permits required many smaller sources would be required to obtain a permit for the first time Initial workload would likely be overwhelming

Title V ANPR Options As with PSD, ANPR takes comment on a range of ways to avoid a large increase in the number of sources required to obtain Title V permits  Major source size  PTE limits  Similar legal theories to those for PSD Also takes comment on ways to streamline compliance for sources that are covered.  General permits, phase in, etc.  Would the Title V permit fees structure need to be modified if GHGs were regulated?

Questions for Discussion (sampling from ANPR) Is our estimate of the magnitude of the impacts reasonably accurate and complete? Do our estimates make sense? Which tailoring options are most promising?  Advice on structuring any of the options? Are any tailoring options not worth pursuing? Are there others we should be considering? Should we raise the CO 2 major source size & significance level?  Can we conclude there will be administrative necessity or absurd results? Do States have data/estimates to support this?  Would either legal doctrine justify such an action?  If so, what level should we select and what basis? Could presumptive BACT work? How?

SIPs and CO2 Delaware has adopted a rule for distributive generation which set CO2 emission limits. Region 3 approved the rule into their SIP Impacts?

Deseret and Section 821 Sec. 821 of 1990 amendments legislation:  SEC INFORMATION GATHERING ON GREENHOUSE GASES CONTRIBUTING TO GLOBAL CLIMATE CHANGE. (a) Monitoring.-The Administrator of the Environmental Protection Agency shall promulgate regulations within 18 months after the enactment of the Clean Air Act Amendments of 1990 to require that all affected sources subject to title V of the Clean Air Act shall also monitor carbon dioxide emissions according to the same timetable as in section 511 (b) and (c). The regulations shall require that such data be reported to the Administrator. The provisions of section 511(e) of title V of the Clean Air Act shall apply for purposes of this section in the same manner and to the same extent as such provision applies to the monitoring and data referred to in section 511. Will be addressed in upcoming decision by EPA’s EAB