By Greg Towler Recently, in working with a long-term Indiana client, with a production campus (multiple plants connected or across the street from one another), I became aware that they wanted to buy another plant a few miles away which will do some complementary operations.  As part of their fact finding and preparation, they asked, “Will we need one air permit or two?”  I have seen mostly the conservative approach by the Indiana Department of Environmental Management (IDEM), which led me to advise them that they would likely need to add the new facility to their current campus permit.  Across the country, other states’ requirements have varied from very strict to looser. This question comes up every day in the air permitting world.  One would think that the November 2019 guidance from the EPA would have cleared that up, right?  WRONG!!!  The federal agency allows each state to set specific determination parameters.  Even those states which are direct adopters of all federal regulations are not required to follow the guidance strictly, although most do. For states with State Implementation Plans (SIPs), it gets even more confusing.  Indiana, for example, will tell you they are NOT currently using federal guidance and emphasize they also are not required to.  State likes to put their own brand on this topic.

What were the determining factors?

Previously, to determine if a project was one or two sources, EPA and the state agency would look to see if the buildings or operations had common ownership, if the properties were connected, if the SIC Codes were in the same ballpark, how much one plant had to do with the other, and if not connected, how ‘adjacent’ were they. Although it defies common sense, do not to take the word ‘adjacent’ literally.  That qualifier of single-source questions has more to do with business relationship than geophysical space, although that is a factor.

What Does Adjacent Mean Now?

On November 26, 2019, Anne Idsal, EPA Acting Assistant Administrator, wrote a memo interpreting the word “Adjacent” for ‘New Source Review and Title V Source Determinations in All Industries Other Than Oil and Gas”.  This document did not change qualifiers of common ownership or sharing a border; however, it did simplify what had become a crazy, stupid mess of defining the words “business relationship” and eliminated what was wrapped up in the word ‘adjacent’. In the federal guidance, ‘adjacent’ now means physical proximity only.  If you do not share a border even though you are owned by the same company, it doesn’t matter what one plant does for the other. Now, is your plant a quarter mile down the road from the other? Maybe it is truly adjacent, and you are ‘one’ source.  Is it 5 miles away?  Then, your plant is more likely to be considered separate under new federal guidance.  It is important to note that while the federal definition was revised, each state’s interpretation did not change.  The strictest interpretation is that if it is not touching the other property, it is a separate permit.  I wish I could tell you that every state will follow that, but 19 years of air permitting tells me not to rely on that completely. For SIP states, it varies more widely.  Indiana, for now, continues to interpret ‘adjacent’ with the old criteria that had to do with “what percentage of output from property A goes to property B?  It also takes into account the property’s SIC codes and the physical distance between the facilities.  These confusing and vague benchmarks are why the EPA tried to simplify the single source criteria.

What are the advantages and disadvantages of one versus multiple?

A company might ask if it is better to have one permit or two.  Honestly, it depends on the situation.  In general, the higher the permitting level the more costly and difficult it becomes to maintain compliance.  If you are a small company and the emissions ‘portfolio’ is varied between two sites, it may be better to have one permit.  There are countless factors that go into the cost-benefit analysis, but again, the companies don’t make the decision, the State does. Some of the pros of a single permit are:

1. 1. 1. 1. One document with which to comply
         2. If the additional emissions don’t increase your permitting level, you will have lower permitting fees
         3. Lower combined-emitting sources find it simpler to manage compliance

  Some cons of a single permit are:

1. 1. 1. 1. It can drive the permitting level up and make state-level compliance more complex and costly.
         2. It can also make your federal permitting requirements more complex and costly.
         3. A single permit can also put your company on a different ‘radar’ from an inspector’s perspective.

  Multiple permits pros are just the opposite:

1. 1. 1. 1. Can drive the permitting level and compliance costs down.
         2. Can possibly take you off a higher inspector’s ‘radar’.

  Multiple permits cons are:

1. 1. 1. 1. Two documents to maintain.
         2. Two sets of permitting fees.

 

Further Information

Cornerstone’s air experts follow the state permitting regulations that affect our clients very carefully. Contact us at info@corner-enviro.com to discuss your facility’s situation and how it may affect any new project plans.

Greg Towler is a Senior Air Quality Project Manager whose role is to oversee and perform air permitting and compliance-related projects and work directly with clients to achieve full compliance.  He also performs compliance work in wastewater, stormwater, hazardous waste generation, EPCRA reporting and general environmental compliance.