Nice While It Lasted: Biogenic CO2 Exemption From Tailoring Rule Struck Down

“Don’t it always seem to go, that you don’t know what you got ‘till it’s gone?” Joni Mitchell knew what she was talking about in “Big Yellow Taxi” (one of my favorite songs), and any facilities combusting biomass were likely singing it last Friday, July 12, 2013, after the D.C. Circuit Court threw out the biogenic CO₂ exemption from air permitting activities under the Federal Greenhouse Gas (GHG) Tailoring Rule.

The Tailoring Rule, finalized on June 3, 2010 (75 FR 31514), “tailored” emission threshold levels for GHG in order for them to be regulated under the Title V and Prevention of Significant Deterioration (PSD) permitting programs. As of July 1, 2011, any facility with the potential to emit (PTE) over 100,000 tons per year (TPY) of carbon dioxide equivalent (CO₂e) became subject to the Title V program, if they were not already. Additionally, sources with PTE greater than 100,000 TPY CO₂e began to be considered major sources for PSD permitting, and projects resulting in a more than 75,000 TPY increase were subject to PSD review.

On July 20, 2011 (76 FR 139), U.S. EPA declared that biogenic emissions were not required to be included in emissions totals for purposes of determining Title V and PSD applicability, for at least three (3) years from the publication date. Biogenic emissions include but are not limited to: CO₂ from combusting biomass materials, black liquor solids, and portions of tire derived fuel (TDF); CO₂ generated from the biological decomposition of waste in landfills, and CO₂ from fermentation during ethanol production. In its reasoning, U.S. EPA recognized that using certain biological materials may be helpful towards reducing both overall use of fossil fuels and the concentration of atmospheric GHGs, and that careful study would be needed during the deferral period to determine the best way to regulate the resulting GHG emissions. This exemption was effective immediately at the Federal level, but optional for state and local permitting authorities. Any authority choosing to adopt this exemption created an incentive to use more bio-based materials to avoid being pulled in to either the Title V or PSD programs.

The D.C. Circuit Court’s majority decision in Center for Biological Diversity, et al. v. EPA, et al stated that U.S. EPA’s original reasoning was invalid, and that it has no authority to differentiate CO₂ based on its origin, given the wording of the Tailoring Rule and original “endangerment finding” justifying regulation of GHGs under the Clean Air Act. A coalition of environmental groups brought the suit, maintaining that biogenic CO₂ emissions may have as strong a climate impact as those from fossil fuels. The exemption will remain in place for 52 days from the decision date.

This decision does not affect the Federal GHG Reporting Rule. Biogenic CO₂ still must be reported under 40 CFR Part 98.

Stay tuned to ALL4’s Blog for further updates from the brave new world of GHG regulations.