Update on the Existing Source Regulations for Oil and Gas: Spotlight on New York, Ohio, and Pennsylvania

The U.S. Environmental Protection Agency (U.S. EPA) proposed in March of 2018 to withdraw its “Control Technique Guidelines (CTGs) for the Oil and Natural Gas Industry” (issued in October 2016) and is currently in the process of reconsidering certain aspects of the New Source Performance Standards (NSPS) that make up the foundation of the CTGs. However, New York, Ohio, and Pennsylvania are moving forward with existing source regulations for the oil and gas industry, and additional states may follow suit.

The U.S. EPA’s issuance of the CTGs forced states with ozone non-attainment areas (Section 182 of the Clean Air Act) and states that are included in the Ozone Transport Region (Section 184 of the Clean Air Act) to adopt reasonably available control technology (RACT) for any source of volatile organic compound (VOC) emissions covered by the CTGs within five years of the effective date, which was October 20, 2016. The deadline for submittal of a modified state implementation plan to the U.E. EPA for approval is two years from the CTG effective date.

The U.S. EPA defines RACT as “the lowest emission limitation that a particular source is capable of meeting by the application of control technology that is reasonably available considering technological and economic feasibility” (44 Fed. Reg. 53761 – September 17, 1979). RACT is intended to take into account the remaining economic life of the unit, as well as the unique factors that could increase the cost of installing a technology on an existing unit as opposed to installing these technologies on new construction. These regulations will likely mirror those found in the NSPS, 40 CFR Part 60, OOOOa that include requirements for fugitive emissions, pneumatic controllers, pumps, and compressors.

In New York, the Department of Environmental Conservation (DEC) published an Oil & Gas Sector Emissions in New York Stakeholder Regulation Outline on November 8, 2018. The document outlines the DEC’s position on what should be contained in a state regulation and includes a detailed summary of control efficiencies proposed for specific types of equipment.  The outline also contains “discussions” wherein the DEC identifies information that would be helpful to them as they develop a rule, such as the cost to retrofit existing tanks to capture and control emissions. The DEC plans to accept preliminary input on the outline through February. CEC is considering comments for submittal; if you’re interested in contributing, please contact Jim Cooper (jcooper@cecinc.com or 412-275-2950). The DEC will then work on a draft rulemaking through the formal State Administrative Procedures Act. When the draft is ready, it will be published, and there will be a 60-day public comment period.

On November 16, 2018, Ohio EPA issued a request for preliminary input from oil and gas stakeholders as it relates to potential existing source regulations aimed at unconventional oil and gas operations not currently covered by existing permits and/or state regulations. The comment period ended on December 19, 2018. Based on the public comments, Ohio EPA will modify the language of the rule as needed and then publish a draft rule for the 30-day public review. Ohio EPA is choosing to handle these regulatory changes through rulemaking rather than through a general permit as it has done in the past to ensure that owner/operators holding pre-2016 permits will be required to meet the same standards as the newer facilities.

Pennsylvania set its implementation date for January 1, 2021, and has no plans to abandon these efforts, or any element of the Governor’s Methane Reduction Strategy, even if the U.S. EPA withdraws the CTGs (83 Fed. Reg. 10478 – March 9, 2018).

The time is quickly approaching when new and modified oil and gas sources won’t be the only concern for operators. Existing source regulations for this industry sector are right around the corner. CEC will be monitoring the rulemaking in these three states and watching to see if other states will follow a similar path. CEC is committed to staying in front of these rules and being prepared to handle the changes in permitting and compliance requirements in an effort to better serve our clients, wherever their operations may be located. For more information about how CEC can assist your organization, please contact Jim Cooper (jcooper@cecinc.com or 412-275-2950).

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