In response to President Biden’s Executive Order entitled, “Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis,” the Environmental Protection Agency (EPA) recently issued a proposed rule taking aim at greenhouse gases (GHG) and volatile organic compounds (VOC) emissions from new and existing oil and natural gas production, processing, transmission, and storage facilities.  The proposal contains three basic components.  In a break with precedent, EPA did not provide proposed regulatory language.

First, the proposed rule would revise the new source performance standards (NSPS) for GHGs and VOCs for new, modified, and reconstructed sources, including the production, processing, transmission, and storage segments.  Specifically, EPA proposes to a new subpart OOOOb that would update and expand the current requirements under CAA Section 111(b) for methane and VOC emissions from sources constructed, modified, or reconstructed after November 15, 2021.  NSPS OOOOb would include standards for emission sources not regulated previously under the 2016 NSPS OOOOa.  Among other changes, EPA proposes to apply to VOC emissions thresholds to storage vessel tank batteries as opposed to individual storage tanks.  EPA has also suggested a change to the definition of legal and practical enforceability which could impact the utilization of state-level permitting previously used to reduce the potential to emit to below the 6 ton per year VOC-threshold.

Second, the proposed rule would create a new subpart OOOOc that would contain the first nationwide emissions guidelines (EG).  The EG would be a state model rule that states could use to develop, submit, and implement state plans that establish performance standards to limit GHGs from existing sources.

Third, the proposed rule takes several actions related to the June 30, 2021 joint Congressional resolution under the Congressional Review Act disapproving EPA’s final rule entitled, “Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Review” (2020 Policy Rule).  The proposed rule would amend the 2016 NSPS OOOOa to address (1) certain inconsistencies between the VOC and methane standards resulting from the disapproval of the 2020 Policy Rule, and (2) certain determinations made in the final rule entitled “Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Reconsideration” (2020 Technical Rule), specifically with respect to fugitive emissions monitoring at low production well sites and gathering and boosting stations.  The proposed rule would also rescind provisions of the 2020 Technical Rule that were not supported by the record for that rule.  Further, in the final rule, EPA will update the NSPS OOOO and NSPS OOOOa provisions in the Code of Federal Regulations (CFR) to reflect the disapproval of the 2020 Policy Rule.  The proposed rule explains that because of the disapproval under the CRA, the 2020 Policy Rule is being treated as if it never took effect.  Therefore, the requirements in the 2012 NSPS OOOO and 2016 NSPS OOOOa that the 2020 Policy Rule repealed must be treated as being in effect immediately upon enactment of the joint resolution.

Public comments on the proposal is due by January 14, 2022.