In March 2010, EPA plans to establish standards regulating greenhouse gas (GHG) emissions from light-duty motor vehicles. This rule has the potential to cripple stationary source air permitting programs and small businesses throughout the nation. How does a mobile source rule have such an impact on stationary source air permits?

Once the mobile source rule is finalized, GHGs are regulated pollutants that trigger Prevention of Significant Deterioration (PSD) and Title V applicability. PSD and Title V apply to sources with the potential to emit above major source thresholds, which for PSD is 100 or 250 tons per year (tpy) depending on source category, and for Title V is 100 tpy. PSD would also be triggered by a modification resulting in any significant increase of GHG emissions.

At these thresholds, EPA estimates that GHG emissions would result in PSD applications rising from 300 to 40,000 per year and the total number of Title V sources rising from 15,000 to approximately 6 million. Such an increase would dramatically overburden permitting authorities throughout the country and essentially bring the permitting process to a standstill. In addition, many small sources would be faced with the significant financial burden of complying with the permitting, emissions control, and monitoring requirements of PSD and Title V.

However, citing the legal doctrines of “absurd results” and “administrative necessity,” EPA is taking actions to limit the impacts on PSD and Title V permitting programs. EPA is proposing to establish a new PSD and Title V major source threshold for GHGs at 25,000 tons per year of carbon dioxide equivalents (tpy CO2e). In addition, EPA is proposing to establish a PSD significant increase threshold for GHGs somewhere between 10,000 and 25,000 tpy CO2e. These thresholds will remain in effect for a period of 6 years. EPA will spend 5 years studying permitting authorities’ ability to administer the programs at these thresholds, and by the end of the 6th year EPA will finalize regulations confirming these thresholds or establishing different thresholds.