There's a growing consensus that the United States’ 50-year-old environmental laws need reform. While much of the focus to date has been on the National Environmental Policy Act (NEPA), given its role in blocking clean energy projects, other landmark environmental laws are starting to receive attention. The Clean Air Act, in particular, has long been cited by manufacturers as a barrier to development, culminating in the recent introduction of the bipartisan Modernizing Clean Air Permitting Act of 2024. As policymakers from both parties consider how to better align economic and environmental goals, several reforms could enhance the efficiency of the Clean Air Act without compromising its core protections. Here are three ideas for EPA, and three ideas for Congress:
Recommendations for EPA
1. Develop robust guidance for minor source permitting.
Current problem: The lack of comprehensive federal guidance on minor source permitting has led to inconsistent implementation across states. This inconsistency has led some states to overregulate minor sources by adopting rules similar to their major source program, resulted in inefficient permitting processes, and created regulatory uncertainty for businesses operating in multiple states.
What to do: EPA should:
- Create a model minor source permit program that states can adopt or adapt.
- Recommend best practices for streamlined permitting processes.
How the reform helps: This guidance would provide a more uniform approach to minor source permitting across the country, reducing regulatory uncertainty for businesses while ensuring that minor sources are appropriately controlled. It could also help states with limited resources to implement more effective programs.
2. Support state adoption of flexible air permits for minor sources.
Current problem: EPA's work on flexible air permits for minor sources has not been widely adopted, potentially as the result of a lack of guidance, follow-up, and ongoing support. This represents a missed opportunity for more efficient permitting that could benefit both regulators and regulated entities.
What to do: EPA should:
a) Conduct a study of flexible permit implementation, which should include:
- Surveys of states that have and haven't implemented flexible permits
- Case studies of successful implementations
- An analysis of the impact on air quality in areas using flexible permits
b) Based on the study, update the flexible permit guidance to address challenges and incorporate lessons learned.
c) Develop a toolkit for states to implement flexible permits, including model permit language and implementation strategies.
How the reform helps: Revitalizing the flexible permit program could streamline the permitting process for many minor sources, reducing regulatory burden while maintaining environmental protections.
3. Issue clearer guidance around Plantwide Applicability Limitation (PAL) permits.
Current problem: PAL permits, designed to provide operational flexibility while capping overall emissions, have seen limited adoption. The main concern is the potential for automatic "ratcheting down" of the PAL at renewal, which creates uncertainty for facilities and discourages participation.
What to do: EPA should issue updated guidance on PAL permits that:
a) Clearly states that PALs should not be automatically ratcheted down at renewal if actual emissions plus the significant level are more than or equal to 80 percent of the current PAL.
b) Provides a clear, step-by-step process for PAL renewal evaluations.
c) Clarifies how PALs interact with other regulatory requirements (e.g., New Source Performance Standards).
d) Offers examples of successful PAL implementations, including case studies demonstrating the benefits to both facilities and regulators.
How the reform helps: This guidance would provide regulatory certainty for facilities considering PALs, likely increasing their adoption. Increased use of PALs could benefit both industry (through operational flexibility) and regulators (through simplified monitoring and a clear emissions cap).
Recommendations for Congress
1. Consider natural background levels when determining attainment.
Current problem: When areas do not meet national ambient air quality standards (NAAQS), they are subject to far more prohibitive air quality regulations than attainment areas. Some areas have high levels of naturally occurring pollution (e.g., ozone from vegetation or particulate matter from dust storms). Current regulations don't always account for this, making it nearly impossible for these areas—including those that have zero industrial facilities—to reach attainment status.
What to do: For revised NAAQS, if meeting the standard would require a state to lower emissions below naturally occurring levels in that area, EPA should not require states to reduce levels below what's locally uncontrollable to be in attainment.
How the reform helps: By not requiring states to reduce pollution below natural background levels, EPA’s attainment rules would acknowledge the reality of varying geographic conditions, allowing states to focus on controllable sources of pollution rather than fighting against natural phenomena. This reform wouldn't significantly affect air quality because it applies only to pollution that would occur naturally, and would allow for more targeted, effective efforts to reduce human-caused pollution in these areas.
2. Consider technological feasibility and compliance costs in NAAQS revisions.
Current problem: EPA currently sets NAAQS based solely on public health considerations, without regard to technological feasibility or economic effects. This can lead to standards that are extremely costly or technologically challenging to meet.
What to do: As proposed in the Modernizing Clean Air Permitting Act, Congress should require the EPA Administrator to consider three additional factors when revising NAAQS:
- Existing rates of compliance with previous standards
- The technological feasibility of complying with the proposed revision
- The costs of complying with the proposed revision
How the reform helps: By considering feasibility and costs, EPA could set standards that are still protective of public health but also achievable with current or near-future technology. This could lead to more realistic compliance timelines and avoid situations where industries are forced to shut down because of impossibly strict standards. This approach would still drive air quality improvements, but at a more manageable pace, leading to better overall compliance and sustained progress in the long term.
3. Change how modifications to existing sources are treated.
Current problem: Many upgrades or changes to existing facilities can trigger New Source Review (NSR), requiring expensive retrofits and lengthy permitting processes. This can discourage facilities from making efficiency improvements or modernizing their equipment, including those that would decrease the overall emissions of the facility. As Art Fraas et al. write in the Environmental Law Reporter, this may have had “the perverse effect of delaying reductions in pollutants such as SO2 and NOx.”
What to do: Amend Section 111 of the Clean Air Act to redefine when a modification is considered a new source. Specifically, a modification should be considered a new source if it either: a) expands capacity/production and increases the maximum hourly emission rate of any regulated air pollutant above what was achievable in the past 10 years, or b) results in total annual emissions of any regulated air pollutant projected to exceed the highest annual emissions of the same pollutant in the past 10 years by more than 10 percent.
How the reform helps: By redefining what constitutes a "new source," facilities could make more upgrades without triggering NSR. This could encourage modernization and efficiency improvements that might actually reduce emissions.
