Strategic Planning for COVID-19-Driven Production Projects

This article is part of ALL4’s 4 The Record: Quarantine Series.

DISCLAIMER:  This article discusses general considerations around needing to respond to an acute COVID-19 situation that could result in a permit limit exceedance.  It does not recommend that any permit limit be exceeded nor does it replace guidance from legal counsel that addresses your specific situation.

Much has been made of the ability of facilities to comply with environmental obligations during the COVID-19 pandemic.  How will we comply with stack testing obligations if we are not able to have stack testing contractors on site?  How will conduct routine monitoring if environmental staff members are sick and unable to work?  These are just a couple of the questions that come up as we evaluate the hundreds of provisions that are contained in operating permits.  In response to these concerns, U.S. EPA issued a COVID-19 compliance enforcement guidance memorandum and a number of state agencies have followed suit.  Read my colleague Roy’s article to learn more about the U.S. EPA enforcement guidance.

Beyond making certain environmental obligations more difficult to address, COVID-19 has also changed the market dynamics and production demands for a lot of facilities.  In certain instances, facilities that produce products in the pulp and paper industry or that contribute to critically needed equipment (e.g., medical equipment) have seen their production demands increase.  This means that facilities are exploring projects required to increase production or are considering postponing previously scheduled downtime to keep operations running.  In some cases this could also mean evaluating the need to exceed established permit production or emissions limits.

Does U.S. EPA’s enforcement memo allow for exceeding a production or emissions limit if the exceedance is being prompted by COVID-19-related production demands?  The short answer is no.  Some facilities are being directed by President Trump to produce new products (e.g., ventilators) using his powers under the Defense Production Act, which does not appear to provide exemptions from environmental obligations (not surprising since the Defense Production Act was introduced in 1950).  Similarly, a state regulatory agency does not have the ability to provide a blanket compliance exemption from production or emissions limits.  Given that, here are suggestions for steps to take when evaluating production or emissions limits in an acute COVID-19-provoked situation:

1. Discuss the situation with internal or external legal counsel so that they can assess the ramifications.
2. The immediate first step is to connect with your state regulator to explain the situation and the drivers behind it. They can provide you with an understanding of the discretion (or lack thereof) that will be used in enforcement down the road.
3. Consider the true environmental implications of the potential permit limit exceedance. Will the exceedance of a production limit result in actual emissions increases versus current or baseline emissions rates?  Will the exceedance be anticipated to create issues relative to ambient standards or state air toxics rules?  Would an updated air dispersion modeling exercise produce a different permit limit?  Can better data be obtained to refine an emissions estimate?  Can changes be made at the facility to offset any emissions increases?
4. Prepare documentation of any environmental impacts of exceeding the permit limit that can be submitted to the regulatory agency as soon as possible and follow up with the agency often as the situation progresses.

Feel free to contact me at cmccall@all4inc.com or (908) 328-9429 with questions or additional thoughts.  We hope that all facilities that manufacture key products to help with the pandemic can make those products without limitation over the next several months.