The Clean Air Act (CAA) requires the EPA to review the National Ambient Air Quality Standards (NAAQS), including ozone, on a regular basis.

On November 25, 2014, the EPA proposed to strengthen the NAAQS for ground level ozone. EPA is proposing to establish both the primary ozone standard and the secondary standards within a range of 65 to 70 parts per billion (ppb). EPA is also seeking comments on levels as low as 60 ppb for the health standard. The current ozone standard is 75 ppb.

EPA is under a court order to issue a final decision on the new proposed ozone standard by October 1, 2015. State designations for non-attainment are due within one year after the final rule is promulgated; in other words, by October 2016.

Impacts to Wisconsin industry

The new proposed ozone standard will have an enormous impact on Wisconsin industries whose operations emit ozone-forming chemicals such as volatile organic compounds (VOC) and nitrogen oxide (NOx) compounds. A list of industry categories that would be impacted by these new ozone standards can be found at this link.

In the event EPA decides to reduce the ozone standards to 70 ppb, the following link indicates the areas of the country, including Wisconsin, which will be designated as non-attainment. These areas include most all of the major urban areas along Lake Michigan. In addition, if the ozone standard is reduced to 65 ppb by EPA, the above link depicts the non-attainment areas that will be included in Wisconsin as well as nationwide.

The impact of a lower ozone standard will be very significant for industry. Under a lower ozone standard, these impacts will include the following:

1. New requirements will apply to emission sources of VOC or NOx compounds that are considered to be "major sources." A major source under the new ozone standards will be a facility that has the potential to emit VOC or NOx compounds in a range of 25 – 100 tons of such compounds, depending upon the severity of the non-attainment area where the facility is located.

2. Any new or existing major source facility which results in emission increases of VOC or NOx compounds would be subject to new, more stringent emission controls for that facility.

3. The major source facilities that are proposing to increase VOC or NOx emissions will be required to obtain the emission reductions (in other words, offsets) for such proposed emissions that will vary from a 1:1 ratio to as stringent as a 1:1.5 ratio, depending upon the severity of the non-attainment area where the facility is located.

Wisconsin businesses should now begin to consider the impacts of the new proposed ozone standards. This planning should include a consideration of the timeline for new facility construction in relationship to the proposed effective date of the new ozone standards. The planning should also include documenting and verifying facility improvements that result in VOC or NOx emission reductions, since these reductions could have significant value under these new ozone standards as offset credits. These offset credits could be very valuable for sale to other parties or for use by the facility generator when there is a need to obtain offset credits within these newly designated non-attainment areas for offsetting proposed increases of emissions in the future.

EPA’s Unified Agenda indicates August 2015 for release of greenhouse gas emission standards for new and existing electric utility generating units

EPA’s Spring 2015 Unified Agenda indicates EPA plans to release the final rule setting emission standards for greenhouse gases from existing electric utility generating units (EGUs) in August 2015. This is a slight delay from the June 2015 estimated release date in EPA’s prior Unified Agendas. EPA’s timeline for finalizing the rule setting greenhouse gas standards for existing EGUs is available here.

EPA released its Unified Agenda for Spring 2015, which lists upcoming pending regulatory actions, on May 22. The Unified Agenda also includes an updated timeline for the rulemaking setting greenhouse gas standards for new or modified EGUs and sets an estimated timeline for EPA’s proposal and finalization of a federal implementation plan, which will apply to states that fail to develop their own state implementation plan for the Clean Power Plan.

EPA’s Spring 2015 Unified Agenda indicates the greenhouse gas standards for new or modified EGUs will be released in August 2015. EPA’s timeline regarding greenhouse gas standards for new or modified EGUs is available here. The Unified Agenda also indicates EPA will publish a Notice of Proposed Rulemaking (NPRM) for the federal plan in August 2015 and finalize the federal plan by August 2016. EPA’s timeline on the federal plan is available here.