U.S. EPA Releases Final Chemical Plant Emissions Rules

On April 9, 2024, the U.S. Environmental Protection Agency (“EPA”) released several final rules¹ that regulate emissions and require new air monitoring from roughly 220 chemical plants across the country that make synthetic organic chemicals and a variety of polymer and resins. The rules focus heavily on ethylene oxide and chloroprene emissions. The rules will be effective 60 days after publication in the Federal Register. However, several companies and industry groups are expected to challenge the rules in federal court. 

What’s in the final rules?

In the rules, EPA finalized amendments to the National Emissions Standards for Hazardous Air Pollutants (“NESHAP”) that apply to the synthetic organic chemical manufacturing industry (“SOCMI”) and to equipment leaks from certain non-SOCMI processes located at chemical plants. These NESHAP, which are commonly referred to as the Hazardous Organic NESHAP (“HON”), contain maximum achievable control technology (“MACT”) standards for hazardous air pollutants (“HAP”) from heat exchange systems, process vents, storage vessels, transfer racks, wastewater, and equipment leaks at chemical plants that are major sources of HAP-producing SOCMI chemicals (e.g., bulk commodity chemicals) and for equipment leaks for certain non-SOCMI chemical processes. The EPA also revised NESHAP requirements for storage tanks, loading operations, and equipment leaks to reflect developments in practices, processes, or controls of HAP.  

EPA also finalized amendments to the NESHAP that apply to the polymers and resins (“P&R”) Group I and II industries, which refers to major source facilities that produce certain elastomers and regulates HAP emissions from nine different source categories. P&R Group I contains MACT standards for HAP from storage tanks, process vents, equipment leaks, wastewater systems, and heat exchange systems. P&R Group II applies to existing and new epoxy resins and non-nylon polyamides production operations that are located at major sources. Similarly, P&R Group II contains MACT standards for HAP from storage tanks, process vents, equipment leaks, and wastewater systems. 

EPA also finalized New Source Performance Standards (“NSPS”) to reflect the best system of emissions reduction for emissions of volatile organic compounds (“VOC”) from SOCMI air oxidation unit processes, SOCMI distillation operations, SOCMI reactor processes, and equipment leaks located at SOCMI sources. The rules also include revisions related to emissions during periods of startup, shutdown, and malfunction (“SSM”), additional requirements for electronic reporting of performance test results, performance evaluation reports, and compliance reports, revisions to monitoring and operating requirements for control devices, and other minor technical improvements.

The rules are extremely voluminous, with the pre-publication exceeding 1,300 pages. Some of the key elements of the rules are briefly described below:  

• Ethylene Oxide and Chloroprene Emission Standards – In the rules, EPA finalized emissions standards for ethylene oxide emissions and chloroprene emissions. For ethylene oxide, the rules require control for process vents, maintenance vents, pressure relief devices, storage vessels, equipment leaks, heat exchange system, and wastewater “in ethylene oxide service.” EPA finalized all the proposed ethylene oxide requirements except the ethylene oxide flare load limit. For chloroprene, the rules require control for process vents, maintenance vents, pressure relief devices, storage vessels, and wastewater “in chloroprene service.” EPA did not finalize all chloroprene requirements as proposed, but instead made several modifications based on comments received. Most notably, EPA did not finalize the facility-wide chloroprene emissions cap. Once implemented, EPA expects the rules “will reduce both [ethylene oxide] and chloroprene emissions from covered processes and equipment by nearly 80 percent.
• Fenceline Monitoring Requirements – The rules include fenceline monitoring requirements for six toxic air pollutants — ethylene oxide, chloroprene, vinyl chloride, benzene, 1,3-butadiene, and ethylene dichloride. This is a significant expansion of EPA’s requirements for “fenceline monitoring,” which is currently only required for oil refineries and only for one pollutant, benzene. EPA will make the emissions data publicly available on its WebFIRE webpage. For all six pollutants, owners and operators must find the source of the pollution and make repairs if annual average air concentrations of the chemicals are higher than a specified action level at the fenceline. The final action levels vary depending on the chemicals and type of source emitting them. For ethylene oxide, EPA issued an action level of 0.2 micrograms per cubic meter of air.For chloroprene, EPA set two fenceline monitoring “action levels”: 0.8 micrograms per cubic meter, based on compliance with the technology standards in the rule; and 0.3 micrograms per cubic meter at neoprene production facilities.
• NPSP for VOC – EPA finalized a determination that the best system of emissions reduction for reducing VOC emissions from SOCMI air oxidation units, distillation operations, and reactor processes remains combustion (e.g., incineration, flares) and maintained the standard of performance. Consistent with the proposal, EPA finalized revised process vent requirements for SOCMI air oxidation unit processes, distillation operations, and reactor processes for which construction, reconstruction, or modification commenced after April 25, 2023. For equipment leaks, EPA finalized revised requirements for facilities that commence construction, reconstruction, or modification after April 25, 2023.
• Removal of Exemptions for Periods of SSM – Regarding NESHAP, EPA finalized a requirement that the standards apply at all times, which is consistent with the Sierra Club v. EPA, 551 F.3d 1019 (D.C. Cir. 2008) decision and eliminates an exemption for periods of SSM. As such, the SOCMI and P&R II source categories must meet the standards even during periods of startup and shutdown. EPA clarified that Clean Air Act Section 112 does not require emissions that occur during malfunction to be factored into development of the standards and eliminated language that treated startup and shutdown the same as malfunction. EPA also finalized alternative standards for certain emission points during periods of SSM to ensure a standard applies at all times. Regarding NSPS, EPA determined the reasoning in Sierra Club also applies to Clean Air Act Section 111 and finalized a requirement that the NSPS standards apply at all times, even during periods of SSM.

What facilities are impacted?

The facilities subject to the final rules are the SOCMI source categories, which include chemical manufacturing processes producing commodity chemicals, and various polymer and resins manufacturing source categories, which include elastomers production and resin production processes that use epichlorohydrin feedstocks. 

As depicted in the EPA map below, a significant portion of the affected facilities are in Texas and Louisiana. 

See hon-final-rule-overview-presentation_0.pdf (epa.gov). 

When do the facilities need to comply?

Neoprene production sources must meet risk-based standards for reducing chloroprene within 90 days after the rule becomes effective. EPA noted that monitoring equipment is already in place at the one facility affected by this requirement, and the Clean Air Act allows the facility to submit a request for an extension of the monitoring deadline of up to two years. For facilities other than neoprene production sources, EPA finalized a deadline of two years to begin fenceline monitoring for ethylene oxide, benzene, 1,3-butadiene, ethylene dichloride and vinyl chloride, rather than one year as proposed. Starting one year after monitoring begins, facilities must submit quarterly data to EPA. The data will be due within 45 days of the end of each quarter.  

What’s next?

The rules will undoubtedly create a number of interpretive and implementation challenges for impacted facilities. After the rules are published in the Federal Register, EPA will be publishing key technical documents on its website and will likely issue guidance to assist with implementation. 

The rules will likely be challenged. Pursuant to the Clean Air Act, opponents of the rules must file a petition for review in the US Court of Appeals for the District of Columbia Circuit within 60 days of the rules being published in the Federal Register. 

If the rules are not stayed by a federal court, they will become effective 60 days after publication in the Federal Register.

¹ The final rules are entitled, “New Source Performance Standards for the Synthetic Organic Chemical Manufacturing Industry and National Emission Standards for Hazardous Air Pollutants for the Synthetic Organic Chemical Manufacturing Industry and Group I & II Polymers and Resins Industry.”