12/11/2018 - Regulatory Rollback

Petroleum Refinery Sector Rule (NESHAPs / NSPS)

by Hana Vizcarra, Laura Bloomer

The Environmental & Energy Law Program is tracking the environmental regulatory rollbacks of the Trump administration. Click here for the list of rules we are following. If you’re a reporter and would like to speak with an expert on this rule, please email us.

Why It Matters

There are nearly 150 petroleum refineries operating in the United States. Each day, these refineries are capable of turning more than 18 million barrels of crude oil into highly demanded petroleum products, such as gasoline and diesel fuel.

The process of refining crude oil is very complex and can result in pollutant leaks and releases to the atmosphere through flares and vents at the facility. These emissions impact the air quality and health of local communities.  One of the most harmful components of crude oil, and one of the pollutants most at risk of leaking, is benzene, a known carcinogen. Pursuant to two Clean Air Act programs, emissions control technology must be installed and operated at refineries to minimize and control releases of air pollutants. These programs are: New Source Performance Standards (NSPS) for newly constructed or newly upgraded refineries, and the National Emissions Standards for Hazardous Air Pollutants (NESHAP), which regulates emissions of toxic air pollutants, such as benzene.

In 2015, the Environmental Protection Agency (EPA) updated the Petroleum Refinery Sector Rule, which strengthened requirements for refineries under NSPS and NESHAP. The rule was projected to reduce emissions of toxic air pollutants by 5,200 tons per year and emissions of volatile organic compounds by 50,000 tons per year. It also includes provisions for fenceline monitoring of emissions to enable early detection of high levels of pollution and facility malfunctions. EPA estimated that the updated standards and monitoring requirements would lower cancer risks for more than 1.4 million people living near refineries.

Current Status

November 26, 2018 EPA publishes a final rule amending the 2015 NESHAP and NSPS for petroleum refineries. EPA contends that the amendments are insignificant and will not negatively impact the environment. Many environmental organizations argue that the changes weaken the regulations and provide unnecessary leniency for industry.

History

December 1, 2015 EPA publishes a final rule revising the NESHAP for petroleum refineries and making technical corrections to their NSPS. The revisions include updating the emissions control standards with which petroleum refineries must comply.  The rule also requires additional emissions monitoring and reporting at refineries. Compliance dates for the various requirements were set between February 2016 and January 2019.

January 19, 2016 Two industry trade groups, the American Petroleum Institute and the American Fuel and Petrochemical Manufacturers, submit a petition to EPA for reconsideration of certain aspects of the final rule. The groups also file a petition for review with the D.C. Circuit Court of Appeals, American Fuel & Petrochemical, et al v. EPA, no. 16-01033.

February 1, 2016 EarthJustice, on behalf of more than ten environmental organizations, submits a petition for reconsideration to EPA. The petition alleges that certain sections of the final rule were not included in the proposal, meaning that the environmental groups and the public were not given proper notice and the opportunity to comment. The groups also challenged certain aspects of the rule, including exemptions from regulation for releases of hazardous emissions that occur due to equipment malfunction. The environmental groups filed a petition for review with the D.C. Circuit Court of Appeals, Air Alliance Houston, et al v. EPA et al, no. 16-01035. This case was later consolidated with American Fuel & Petrochemical, et al. v. EPA.

The two industry groups sent a more comprehensive petition for review to EPA on February 1, 2016. The petition requested multiple revisions to the final rule, including technical corrections, compliance date extensions, and the elimination of some requirements.

February 9, 2016 EPA issues proposed amendments responding to industry’s original petition for review. EPA proposed to extend the compliance date for multiple standards that apply during startup, shutdown, and hot standby. This included an extension to the maintenance vent standards, which regulate when and to what extent refineries may release hazardous air pollutants through vents at the refinery during startup, shutdown, or maintenance.

March 4, 2016 EPA files an unopposed motion to put on hold (hold in abeyance) American Fuel & Petrochemical, et al. v. EPA until EPA could respond to the petitions for reconsideration. The motion was granted on March 7, 2016. Subsequent motions to continue to hold the proceedings were filed and granted in 2016 and 2017, based on EPA’s development of revisions to the rules. The case is still being held in abeyance, meaning that EPA must file regular status reports with the court but no other significant litigation actions are occurring.

July 13, 2016 EPA finalizes the amendments proposed in February. The agency extended two compliance dates through the amendments and made technical corrections to the 2015 rule.

October 18, 2016 EPA publishes a proposed rule to receive public comment on the five issues that environmental groups identified in their petition as being newly introduced in the 2015 final rule.

Trump Era

April 10, 2018 EPA publishes a proposed rule, proposing revisions to the refinery rule to address industry’s 2016 petition.  The rule proposed technical corrections for work practice standards for flares and pressure relief devices as well as revisions to fenceline monitoring, recordkeeping, and reporting. In a press release, EPA stated that the proposal would save industry $11.5 million in regulatory costs. Comments were due on May 25, 2018.

July 10, 2018 EPA publishes a proposed rule to further extend the compliance date for maintenance vent standards at certain refineries to January 30, 2019. The original compliance date for these refineries was February 1, 2016. Comments were due on August 9, 2018.

November 26, 2018 EPA publishes a final rule amending the 2015 NESHAP and NSPS for petroleum refineries. EPA did not extend the compliance date for maintenance vent standards as proposed in July and instead made the effective compliance date 30 days from November 26. The agency did finalize, with minor changes, most of the proposals from the proposed rule published in April. EPA contends that these changes are insignificant and will not negatively impact the environment. Certain commentators, most notably environmental organizations, argue that the changes weaken the regulations and provide leniency for industry.