Source: https://eem.jacksonkelly.com/air_quality_and_permitting/
Timestamp: 2019-04-26 12:23:43+00:00

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The Obama EPA finalized two rules in 2015 that comprised the Clean Power Plan (“CPP”). One established CO2 emission standards for new, modified and reconstructed power plans under Section 111(b) of the Clean Air Act. The second, and far more controversial, established CO2 emission “guidelines” under CAA §111(d) to be used by states in regulating existing power plants. As we have noted before, the rule created COs budgets for states that could not be met by existing power plants using any affordable technology. Instead, the rule depended on widespread “trading” by which states could meet their budgets only if coal-fired units were not run and power was generated by a combustion of gas and renewable sources. The rule was notable for its interpretation of the “sources” to which it applied.
Section 111(d) requires EPA to issue emission guidelines to regulate sources of pollutants that reflect the “best system of emissions reduction” (taking costs into account). Historically, EPA has imposed a system of emissions reduction by treating each individual source of pollutants separately and considering how their emissions might reasonably be controlled. Not so with the CPP. Instead, because electric power sources are linked by the power grid, EPA elected to treat the entire grid as a single source of pollution. And, by doing so, it declared that the best system of reductions included not using many of the existing coal-fired units at all and replacing their production with gas-fired or renewable units. Almost immediately, a coalition of coal-producing and coal-burning states and industry sued EPA. Ultimately, the Supreme Court stayed the effect of the rule pending their challenge. Enter the Trump administration.
On April 4, 2017, EPA announced in the Federal Register that it was reviewing the CPP, as well as its prior legal memorandum justifying the expansive system of emissions reduction. 82 FR 16329 (April 4, 2017). Then, on October 10, 2017, EPA announced that it would repeal the 2015 rule for existing power plants. The announcement included an acknowledgement that the 2015 rule departed from EPA’s prior practice of developing measures that can be applied to individual pollution sources. It also includes a statement that the Obama EPA’s interpretation “exceeds the bounds of the statute.” EPA’s proposal to rescind the rule may be found here.
The rescission of the CPP will not be final until EPA finalizes the newly-proposed rule, and there will surely be challenges to the proposal. And, even if the rescission rule is finalized, EPA will be obligated to issue a new rule unless it also finds a way to avoid regulating COs emissions from new sources altogether.
On August 23rd, the federal Court of Appeals for the Third Circuit affirmed a decision by the Corps of Engineers to issue a Clean Water Act §404 permit to Tennessee Gas Pipeline Company to construct about 13 miles of “looped” pipeline in two counties in northeastern Pennsylvania (read the JK Energy & Environmental Monitor summary of Delaware Riverkeeper Network v. U.S. Army Corps of Engineers, No. 17-1506. Link. One week later, August 30, the same court issued another opinion in a companion case, Delaware River Network v. Secretary, Pennsylvania Department of Environmental Protection, No. 17-1533. Link. In a nutshell, same project, same plaintiff, different claim, but same outcome.
In the second case, the Delaware Riverkeeper Network sued the Pennsylvania DEP for issuing a federal Clean Water Act §401 water qualification in September 2016 conditioned on the project securing two state permit for encroaching on wetlands that the agency deemed to have “exceptional value” under state law. The agency subsequently issued the two permits, and the environmental group sought review. The federal court has jurisdiction because the project is authorized under the federal Natural Gas Act, 15 U.S.C. §717r(d). On review, the environmental group raised two issues.
The first contested the “finality” of the September DEP water quality certification. The group argued that no agency action was final until an appeal could be filed with the Pennsylvania Environmental Hearing Board, which it admitted it did not file within the time (30 days) permitted by state regulations. Predictably, the Third Circuit made short shrift of this claim.
On November 10, 2016, EPA issued Information Collection Request requiring oil and natural gas companies to provide extensive information that EPA desired to develop regulations for reducing methane emissions from existing oil and gas sources.
The information request was sent to more than 15,000 owners and operators in the oil and gas industry. The request was comprised of two parts: An “Operator Survey” that asked for basic information on the numbers and types of equipment at on-shore oil and gas production facilities; and a “Facility Survey” asking for more detailed information on sources of methane emissions and methane control devices or practices in use by a representative sampling of facilities in several segments of the industry.
By Federal Register notice of March 2, 2017, EPA withdrew both parts of the 2016 information request, effective immediately. EPA’s March 2 notice advises survey recipients who have questions that they may contact the EPA information collection request helpdesk at 888-372-8696 or by email at icr@epa.gov.
In combination with the release of the Stream Protection Rule (“SPR”), previously reported, the Obama administration released a Memorandum of Understanding (MOU) between the U.S. Fish and Wildlife Service (“F&WS”) and the United States Office of Surface Mining (“OSM”) which expands the role of the OSM in delegated state program oversight and the consideration of permitting actions that may impact endangered species. Referenced in the MOU, though not published or released by either F&WS or OSM, is a new Programmatic Biological Opinion (“PBO”) which outlines the implementation and enforcement of the SPR in ESA-related SMCRA permitting actions.
The MOU and PBO provide “guidance” for reviewing SMCRA permits both before and after implementation of the SPR. Unlike the SPR, however, they are effective now. They provide F&WS and OSM the tools needed to incorporate many provisions of the SPR into the SMCRA permitting process under the guise of a review of potential ESA impacts.
Previously, the SMCRA regulatory authority (“RA”)—WVDEP in West Virginia and PADEP in Pennsylvania—was required to provide written notification to the F&WS whenever the RA received an application for a new permit, significant revision, or permit renewal. To approve the permit, the RA was required to make a written finding that a proposed operation would not jeopardize threatened or endangered species or critical habitat. This finding was based upon information gathered and the development of enhancement and protection plans to minimize effects on listed species, if necessary. The F&WS could request the information relied upon by the RA to make the written finding, but this was not common.
Now, the F&WS will request and review all information relied upon by the RA to make the written finding. Additionally, the baseline information needed to satisfy the F&WS will expand based upon SPR provisions. Further, any disagreements between RAs and the F&WS about the adequacy of the information reviewed or the protections included in the permit will be governed by a time-consuming “technical assistance process.” This process essentially establishes a timed process between the RA and F&WS to work through disputes. In the event that a dispute cannot be resolved, there is now an “elevation process” (the guidance suggests that RAs defer final action during this elevation process). Regional Review Teams have been created to resolve these disputes. These teams will consist of executives or designees from RAs, F&WS, and OSM. Finally, this “technical assistance process” is not limited to permit issuance, significant revisions, and renewals. Rather, it must be initiated anytime the operator new species listed or proposed that may be affected or any new information reveals effects of the operation that may affect listed species or critical habitat. Altogether, the MOU and PBO setup a process that will make the ESA consultation much more cumbersome—if not impossible—to successfully complete.
For instance, once notified of a new permit, significant revision, or renewal impacting ESA-listed resources, the F&WS field office will request that the RA provide the F&WS all fish and wildlife resource information contained in the permit application and the fish and wildlife protection and enhancement plan contained in the permit application. The F&WS will evaluate these materials and decide whether they are sufficient to determine if and how the permitted operation will affect listed species or habitats. This evaluation, however, incorporates many SPR provisions. Baseline monitoring requirements will be more cumbersome. The “guidance” suggests expanding the suite of surface and groundwater water parameters tested before, during, and after mining (e.g., conductivity constituents and selenium which have been relied upon heavily to initiate citizen suits). Additionally, biological assessments of perennial and intermittent streams may be required before, during, and after mining within the proposed permit area and those that could be affected in the adjacent area (the PBO states that benthic macroinvertebrates must be identified to the genus level where possible—also relied upon in citizen suits). Moreover, surveys for ESA-listed or proposed species may be required (e.g., presence/absence or status surveys).
In the interim period before implementation of the SPR, the MOU and PBO direct the F&WS to ameliorate “insufficiencies in the existing regulations” by providing species-specific protective measures to the RAs (to be implemented by the operators) during the technical assistance process. Thus, the MOU and PBO, effective now, essentially direct the F&WS to implement the SPR through the guise of species-specific protective measures in SMCRA permits.
Below is a more detailed review of the ESA, MOU, and PBO.
The ESA is aimed at protecting endangered and threatened species and the ecosystems upon which they depend. It requires RAs to consult with the F&WS to ensure that actions they authorize, fund, or carry out are not likely to jeopardize the continued existence of any listed species or result in the destruction or adverse modification of designated critical habitat of such species.
The ESA prohibits any action that causes a “take” of any listed—threatened or endangered—species. “Take” is defined broadly by the ESA as to harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect. Harm may include significant habitat modification where it kills or injures a listed species through impairment of essential behavior (e.g., nesting or reproduction). Actions, such as mining activities, that result in a “take” without an exemption violate the ESA and subject the permittee to legal liability and civil penalties (fines).
To obtain an exemption from the prohibition against take of a listed species, SMCRA permittees must obtain an incidental take statement by participating in the newly formed “technical assistance process” under the PBO and MOU. The incidental take statement must (1) specify the impact of the taking; (2) specify reasonable and prudent measures to minimize the impact; and (3) include terms and conditions that the permit applicant must comply with to implement the reasonable and prudent measures.
The MOU provides “guidance” for procedures and protocols concerning ESA-related activities that must be followed by OSM, F&WS, and RAs during the SMCRA permitting process.
Establishes a National Surface Mining Liaison at the F&WS to facilitate implementation of the MOU.
Most concerning, the MOU creates a cumbersome and potentially time-consuming “technical assistance process” providing guidance for demonstrating compliance with the terms and conditions of the 2016 PBO. The coordination process contains “elevation procedures” to manage disagreements between RAs and the F&WS regarding the adequacy of protections for ESA species in permits. The coordination process and elevation procedures expand the roles of F&WS and OSM in the ESA consultation process.
The MOU contains several provisions that differ from previous ESA-related reviews of SMCRA permits. These differences immediately incorporate many ESA-related provisions from the SPR. These provisions are incorporated through an expansion of the permit information that F&WS will review to make ESA determinations.
Prior to implementation of SPR, the F&WS will require species-specific protective measures to be incorporated into permits if impacts to the hydrologic balance may occur and would negatively affect ESA-listed or –proposed resources. The F&WS will rely on the newly defined meaning of “hydrologic balance” which, under the SPR, expands the area examined to the permit and adjacent areas. The guidance expressly aligns the definition of “adjacent area” with that of the “Action Area” defined by the F&WS: https://www.fws.gov/northeast/nyfo/es/actionarea.htm. This would greatly expand prior interpretations of “hydrologic balance” under SMCRA.
Monitoring will be expanded, at the request of the F&WS, for baseline monitoring along with monitoring during and after permit duration. The guidance contains detailed lists of parameters of concern for ESA species and urges F&WS to expand parameter requests to numerous parameters such as selenium, conductivity constituents, and stream flow. These parameters have been relied upon in many Clean Water Act citizen suits against mining companies and the F&WS may rely on them in requesting species-specific protective measures.
If the F&WS determines that ESA-listed resources may be affected in the 100-foot stream buffer zones, the F&WS may require species-specific protective measures to be implemented. This would potentially result in the immediate implementation of the SPR protections if the F&WS finds ESA-listed resources in these buffer zones for a permit application.
The SPR would substantially reduce the placement of excess spoil in streams. Prior to implementation of the SPR, the MOU directs the F&WS to provide species-specific protective measures to avoid and minimize impacts to ESA-listed of –proposed species in streams proposed to be filled by permits. No limit is placed on which protective measures the F&WS may require. Thus, the F&WS may indirectly implement the SPR’s rules related to fill placement in streams through species-specific protective measure requirements.
The MOU requires SMCRA permits to be reviewed by the F&WS on a permit-by-permit basis through the coordination process. If the coordination process concludes with F&WS permit issuance and agreement that the entire SMCRA operation and conservation plan will not jeopardize species or adversely modify critical habitats, then any take associated with the permitted operation will be exempted by the ESA. The guidance, however, substantially increases the hurdles needing cleared to obtain ESA exemption and expands OSM’s participation in the F&WS review of SMCRA permits for ESA exemptions.
A new species is listed or proposed or critical habitat designated or proposed that may be affected by the permitted operation.
Previously, consideration of newly-proposed or listed species occurred during permit issuance, significant revisions, or renewal. Now, permittees will be subject to the constant threat of reinitiation of the coordination process if they become aware of a newly-listed or proposed species within the permit area or adjacent area.
In 2008, the United States Office of Surface Mining (“OSM”) revised the Stream Protection Rule (“SPR”) to expressly recognize that SMCRA could not be used to prohibit valley fills authorized under Section 404 of the Clean Water Act. After a challenge from anti-mining forces, a court held the rule as insufficient holding that OSM unreasonably relied on the U.S. Fish & Wildlife Service’s (“F&WS”) 12-year-old biological opinion concluding that surface mining and reclamation operations conducted in accordance with existing regulations implementing SMCRA were not likely to jeopardize threatened or endangered species or critical habitat. The court held that reliance on the 1996 Biological Opinion did not satisfy OSM’s requirement of formal consultation with F&WS prior to promulgating the 2008 SPR, where F&WS’s biological opinion did not consider the ESA effects of the revised 2008 rule.
The PBO replaced the 1996 Biological Opinion with the 2016 update to avoid a similar ruling on any challenge of the recently issued SPR. However, permitting actions under the terms of the 1996 Biological Opinion remain valid, unless a proposed permitting action would expand the potential impact on ESA species. This will provide little comfort to the industry, however, because the PBO itself expands the ESA impact area to align it with the SPR.
The PBO develops procedures intended to fulfill OSM’s need under the ESA to consult on the potential for a proposed action to adversely affect threatened or endangered species and proposed and designated critical habitat areas under the ESA.
As described above, the MOU contains several consultation requirements that indirectly implement the SPR. The PBO contains detailed descriptions of various ESA-protected and –proposed species. For each species, it outlines their distribution, habitat, threats, and critical habitat. As detailed earlier, it includes greatly increased monitoring requirements. Combined with the MOU, the PBO will result in an increased examination of each permit for potential effects on these species. The areas where permittees must search for these species will be expanded and the parameters which may affect these species will be expanded. Finally, the F&WS will use the expanded information to require species-specific protective measures.
This article was authored by Matthew S. Tyree, Jackson Kelly PLLC.
 Alternatively, compliance could also be demonstrated by obtaining a permit under Section 10 of the ESA. However, the Section 10 permit process is simply too cumbersome for a single project.
My colleagues and I have the privilege of working with coal operators every day in the places where coal is mined in this country. From coal basins in Appalachia to Illinois to the Powder River Basin, we have had the pleasure of helping those who mine the coal that powers our homes and makes our steel.
In recent years, the challenges have been numerous, to put it mildly. Undoubtedly, many of those challenges have been market-driven. But, without question, there have been unprecedented regulatory pressures as well.
The Clean Power Plan. Perhaps this one is obvious. But the impact of the Clean Power Plan (“CPP”) on coal cannot be overstated. The CPP effectively sets emission limits for carbon dioxide that will drastically restrict (if not ultimately eliminate) the burning of coal for power generation. While the CPP has been stayed by the United States Supreme Court pending the outcome of a challenge in the DC Circuit, even the prospect of such a rule chills new investment in coal. If coal is to continue employing miners and providing low cost energy, a different plan is needed.
The Federal Mine Health Safety and Review Commission. Over the last eight years, the Federal Mine Safety and Health Review Commission has upended years of established case law that protected mine operators against unchecked action by MSHA. The Commission must reestablish itself as an independent adjudicative body. The Trump Administration could start this process by filling the vacant seat on the five-member Commission with a Commissioner dedicated to independent review of MSHA’s actions. We expect that the appointee would be designated the Chairperson, which also may provide guidance to the administrative law judges who serve the Commission.
The Stream Protection Rule. The proposed Stream Protection Rule has been mired in controversy for years. Rather than being designed to protect streams, the rule is widely seen as an attempt to dramatically curtail surface mining in Appalachia and longwall mining everywhere. OSM has been accused of deliberately misleading the public about the rule’s job impacts. The rule has not yet been released in final form and, if it is promulgated in the final days of the Obama Administration, many believe that Congress will undo the rule through the rarely used Congressional Review Act.
The Scope of the Clean Water Act. The Clean Water Act regulates discharges into “Water of the United States.” EPA’s efforts to define this term through its recent “WOTUS” rule have generated significant controversy and litigation. The “WOTUS” definition provided by EPA greatly expands the agency’s jurisdiction in many aspects of America’s economy, including the coal industry. Similarly, the Clean Water Act regulates discharges into “WOTUS” through “point sources,” which have traditionally been defined to include discharge structures such as pipes and ditches. Environmental groups (and some courts) have sought to expand the “point source” definition broadly to include things like dust emanating from coal trains; leaks migrating from fly ash ponds, and groundwater seeping from reclaimed mine sites. The definitions of “WOTUS” and “point source” need to be clarified in a common sense way.
Water Quality Standards. Water quality standards are important and need to reflect the best science. For years, coal operators have been forced to construct very expensive systems to treat water to meet an out-of-date selenium standard. While EPA has recently made some efforts to provide a more realistic standard for selenium (the prior one was based on studies performed in still -- rather than flowing – waters) more work needs to be done. Similarly, EPA has for many years sought to impose limits on “conductivity” in mine water discharges, even though there are some important questions about the underlying science. Standards for selenium and conductivity need to be based on solid and impartial science.
MSHA. The successor to Assistant Secretary Joe Main must commit to working with industry, rather than against it, to help achieve the goals of improving miner safety and health. The new head of MSHA needs to commit to formal rulemaking rather than changing standards through policy documents. Roof control, dust control and ventilation plans must be suited to fit particular mines, rather than a one-size-fits-all approach dictated by the agency. And, MSHA’s respirable dust rule should be reexamined, with a proper consideration of the way in which x-ray programs, personal protective equipment, and administrative controls can play a role in protecting miners’ health.
Federal Coal Leasing. America holds some of the world’s greatest coal reserves and many of those are owned by the Federal Government. These reserves unquestionably provide an enormous benefit to taxpayers: federal coal leases generated $1.3 billion in federal revenue in 2014 and account for 42% of U.S. coal production. In January 2016, however, the Obama Administration announced that it was placing a “moratorium” on new federal coal leases while it examined the “social costs” of coal. Certainly, the costs and benefits of federal coal leases can be analyzed without a largely symbolic “moratorium” that jeopardizes investment in these resources.
NLRB. The pro-labor National Labor Relations Board has expanded the reach of federal labor laws into unprecedented areas in recent years under the Obama Administration. This effort has included the widespread invalidation of arguably neutral employment policies because they have the hypothetical possibility of interfering with the rights of employees to engage in concerted activity. In addition, the Board has expanded the types of employers subject to unionization and unfair labor practices by liberalizing the standard for establishing a joint-employment relationship. Finally, the NLRB has made it easier for unions to organize employers by recognizing small “micro” bargaining units and adopting “ambush election” rules, which shorten the time frames for union elections. Currently, the five-member Board has two vacancies. By appointing two new members with pro-employer leanings, the Trump Administration will have the opportunity to begin the process of paring back these rulings.

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