U.S. Coke Industry Regulatory Issues
Overview of key regulatory issues impacting the U.S. coke industry, including EPA's Risk and Technology Review, 2003 MACT standards, and concerns related to coke pushing, quenching, and battery stacks. Insights on the COETF's collaborative efforts to address environmental challenges in the industry.
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Regulatory Affairs Update Spring 2016 Meeting of the ACCCI Board of Directors Saturday, 30 April 2016 Hyatt Regency Coconut Point Resort and Spa (Bonita Springs, FL) David C. Ailor, P.E. President American Coke and Coal Chemicals Institute 25 Massachusetts Avenue, N.W., Suite 800 Washington, D.C. 20001 USA Tel.: 703-795-3541 Fax: 866-422-7794 e-mail: dailor@accci.org
PRESENTATION OVERVIEW Principal Sector-Specific Regulatory Issues of Concern to the U.S. Coke Industry Principal General Industry Regulatory Issues of Concern to the Coke Industry Principal Regulatory Issues of Concern to the Coal Chemicals Industry Other Important Regulatory Affairs Issues 2
CURRENT STATUS OF THE U.S. COKE INDUSTRY 16 operating coke plants (54 batteries) 6 integrated steel by-product recovery plants (20 batteries) 5 merchant by-product recovery plants (10 batteries) 5 merchant heat-recovery plants (20 batteries) ACCCI addresses key regulatory issues facing the U.S. coke industry. ACCCI-managed Coke Oven Environmental Task Force (COETF) addresses key environmental issues facing the U.S. by-product recovery coke industry. 3
BACKGROUND ON THE COETF The COETF was formed by the American Iron and Steel Institute (AISI) and ACCCI in 1996 to address major environmental issues collaboratively. The COETF operates as a semiautonomous, self-funded entity. The COETF represents all 11 U.S. by-product recovery plants (30 by-product recovery batteries). 6 integrated steel by-product recovery plants (20 batteries) 5 merchant by-product recovery plants (10 batteries) Five heat recovery coke plants (20 batteries) are not represented/participating in the COETF. 4
PRINCIPAL SECTOR-SPECIFIC REGULATORY ISSUES OF CONCERN TO THE U.S. COKE INDUSTRY EPA s Risk and Technology Review (RTR) of 2003 MACT Standards for Coke PQBS CAA 112(c)(6) Litigation 5
EPAS RISK AND TECHNOLOGY REVIEW (RTR) OF 2003 MACT STANDARDS FOR COKE PQBS On April 14, 2003, EPA promulgated maximum achievable control technology (MACT) standards for coke pushing, quenching and battery stacks (PQBS). Standards are to limit hazardous air pollutants (HAPs) from PQBS (e.g.,benzene, toluene, coke oven emissions ). Clean Air Act (CAA) requires EPA to determine within eight years of promulgation (i.e., by 2011 for PQBS) whether tighter standards should be issued, based on: risks to public health associated with MACT-level emissions (risk review); and, whether any improvements in control technology have occurred since the MACT standards were issued (technology review). EPA is behind schedule on the RTR for coke PQBS, having just kicked off the multi-year (three- to-four year) RTR in early 2015. The rulemaking is NOT subject to a court-ordered deadline, but is a high priority of EPA s Acting Assistant Administrator for Air and Radiation, Janet McCabe. The EPA-OAQPS Project Officer, Dr. Donna Lee Jones, indicated a willingness to work with us to adjust/ pare back the testing requirements, on the basis of justified safety, timing and expense issues. 6
EXPECTED COETF ISSUES ON THE PQBS RTR Scope of EPA s Information Collection Request (ICR) Unit risk estimate for Coke Oven Emissions Underlying exposure assumptions for EPA s risk estimates Dispersion modeling Emission factors Cost to comply 7
INITIAL EPA EFFORTS ON THE PQBS RTR EPA provided the COETF with a draft Information Collection Request (ICR) during August 2015 for comment. Enclosure 1: Questionnaire, which asks questions about the company and all of the operations at its coke plant(s) Enclosure 2: Testing request, which includes all of the details of where and how to test From August 2015 through March 2016, the COETF engaged EPA on the draft ICR. 8
COETF EFFORTS ON THE DRAFT ICR Beginning in September 2015, the COETF pushed back on EPA regarding the draft ICR, arguing that: In consideration of current business conditions facing the steelmaking and cokemaking industries, EPA should place on temporary hold the ICR/RTR process until the industries become financially stable and are back to normal and representative production. If EPA moves forward, it is imperative that any data collection effort associated with the ICR be efficient and focus on safely generating accurate, relevant Coke Pushing, Quenching, Battery Stack (PQBS) MACT information necessary to comply with CAA 112(f) requirements. 9
EPAS FINAL (APRIL 2016) PQBS ICR Date ICR Item No. Weeks* 0 Letter stamped date 4-Apr-16 3 Submit e-copy of most recent air permit 25-Apr-16 5 Submit detailed explanation of testing problems 9-May-16 9 Submit names of Quench Tower testing facilities 6-Jun-16 9 Submit any previous test reports applicable to tests 6-Jun-16 12 27-Jun-16 Submit schedules(s) for testing** 17 1-Aug-16 Submit Enclosure 1 responses-Group 1 (Sections I, II, III) ** 21 days before testing Notify your state of upcoming tests*** 23 Submittal #2, Sections IV and V (Group 2) 12-Sep-16 29 Submittal #3, Sections VI and VII (Group 3) 24-Oct-16 34 Advice: Stop testing at least 6 weeks before reports due 28-Nov-16 37 Submittal #4, Sections VIIII, IX, X (Group 4) 19-Dec-16 Submit test reports & data spreadsheets (Enclosure 2) 40 9-Jan-17 * From stamped date of EPA letter; due close of business end of week indicated. ** Revised April 14, 2016 *** Please copy Dr. Jones, U.S. EPA, on the notice at Jones.DonnaLee@epa.gov 10 (continued)
EPAS FINAL (APRIL 2016) PQBS ICR (Concluded) - Parent /Affiliated Company ArcelorMittal ArcelorMittal ArcelorMittal AK Steel Corporation AK Steel (separate inc.) DTE Energy Services, Inc Erie Coke Corporation United States Steel Corp. Firm Name # Co. City State Letters Enc 1 Encl 2 ArcelorMittal Monessen ArcelorMittal Burns ArcelorMittal Warren AK Steel Mountain State EES Coke Battery Erie Coke Corporation US Steel Clairton Works Haverhill North Coke Middletown Coke Gateway (separate inc.) (separate inc.) (separate inc.) 1 2 3 4 5 6 7 8 Monessen Burns Harbor Warren Middletown Follansbee River Rouge Erie Clairton Franklin Furnace Middletown Granite City PA IN OH OH WV MI PA PA OH OH IL 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 9 10 11 11 1 2 Harbor no 3 no no 4 5 Carbon . 6* Suncoke Energy, Inc . 9 9 7 7 Totals 9 9 * Choice of one of these two facilities for testing; both facilities will submit Enclosure 1 Questionnaire. 11
CAA 112(c)(6) Litigation CAA 112(c)(6) requires source categories responsible for at least 90% of the aggregate emissions of seven PBA HAPs to be subject to standards under CAA 112(d)(2) [MACT] or 112(d)(4) [risk-based for specified HAP]. One of the seven HAPs is associated with coke oven emissions - polycylic organic matter (POM). (continued) 12
CAA 112(c)(6) Litigation (continued) In June 2015, EPA issued a rule stating that it had satisfied 112(c)(6) by promulgating standards for numerous specified source categories, including the NESHAPs for coke oven charging/topside/doors, by-product recovery plants, and PQBS. ENGOs filed comments on the proposed rule that EPA had not satisfied its 112(c)(6) obligations with respect to POM from coke ovens because COE is not an appropriate surrogate for POM. ENGOs argue that EPA must promulgate new MACT standards for coke ovens specifically regulating POM. (continued) 13
CAA 112(c)(6) Litigation (Concluded) In July 2015, ENGOs challenged the 112(c)(6) determination (Sierra Club v. EPA). Sierra Club filed its opening brief the week of March 28, 2016; EPA s response brief is due May 27, 2016. An industry coalition comprised of five associations (ACC, AF&PA, AISI, NACWA and NAM) is considering filing an amicus brief in support of EPA. The amicus brief would be due June 3. The COETF and ACCCI s MESH Environmental Subcommittee are considering next steps. 14
PRINCIPAL GENERAL INDUSTRY REGULATORY ISSUES OF CONCERN TO THE U.S. COKE INDUSTRY EPA s Greenhouse Gas Policies EPA s SSM Policies EPA s Ozone NAAQS Final Rule EPA s WOTUS Final Rule EPA s RMP Review/Rulemaking PEER Petition Regarding EPA s RCRA Corrosivity Characteristic 15
EPAS GREENHOUSE GAS POLICIES On August 3, 2015, EPA took three separate but related actions to address carbon pollution from power plants: Final Clean Power Plan, President Obama s signature effort to combat carbon emissions from existing power plants; Final Carbon Pollution Standards for new, modified and reconstructed power plants; and, Proposed Federal Implementation Plan associated with the final Clean Power Plan. The Clean Power Plan, originally proposed by EPA in June 2014, is the country s first regulation of carbon emissions from the Nation s 1,500 existing power plants. the largest source of the nation s GHG pollution. Other sectors could be addressed at any time as sector-specific NSPSs are revised. 16 (continued)
EPAS GREENHOUSE GAS POLICIES (Concluded) The associated standards could lead to the shutdown of coal plants before there is enough alternative power to replace them and, ultimately, to soaring electric bills, power blackouts and years of legal battles. If the Clean Power Plan and the other final rules survive judicial review without substantial change, they will significantly alter the way states and utilities design, plan, and operate our bulk power electric grid for decades to come. ACCCI has joined a new multi-association coalition being led by the National Association of Manufacturers (NAM, of which ACCCI is a member) and the U.S. Chamber of Commerce, which is challenging the new rules. ACCCI has been a party to numerous comment letters to various Federal agencies on the social cost of carbon (SCC) estimates being used by the Administration to justify numerous proposed GHG rules. 17
EPAS SSM POLICIES In 2008, in Sierra Club v. EPA, a three judge panel of the U.S. Court of Appeals for the D.C. Circuit, with one judge dissenting, vacated three provisions in the Part 63, Subpart A of EPA s General Provisions that set forth the general duty to minimize emissions during SSM events and exempted sources from MACT emission standards during SSM events. Since then, EPA has promulgated multiple rulemakings that are re-shaping the way emission standards under Clean Air Act sections 112 and 129 apply during SSM events. The new approach is affecting virtually all source categories subject to MACT standards, including those that apply to coke plants. EPA s position is that SS events are routine and predictable operating conditions and should be treated the same as normal or steady-state operating conditions (that is, subject to MACT floor or beyond-the-floor emission standards). EPA s position is that M events are not distinct operating conditions, and so it will not set unique standards for M events. (continued) 18
EPAS SSM POLICIES (Concluded) In June 2015, EPA issued a final rule in which it asserted that the State Implementation Plans (SIPs) of 38 states were inadequate because of the relief they provide for SSM events (the SSM SIP Call rule ). EPA issued SIP calls for specific, limited language in each state s SIP. EPA s findings of inadequacy are based on inconsistency with EPA policies, not some specific air quality problem. EPA s statements about what SIPs can and cannot say about SSM events are in guidance, not regulation. ACCCI has joined an SSM Coalition which, in August 2015, filed a petition for review of the SSM SIP Call rule in the U.S. Court of Appeals for the D.C. Circuit. 19
EPAS OZONE NAAQS FINAL RULE On October 1, 2015, EPA released its final National Ambient Air Quality Standard (NAAQS) for ozone, lowering the current 2008 standard of 75 parts per billion ( ppb ) down to a level of 70 ppb for both the primary and secondary standards. EPA is lowering the ozone standard despite calls from numerous states, unions, and economic development agencies to retain the current standard. EPA s new ozone standards will place an enormous burden on the still-recovering American economy, causing a estimated 400% increase in nonattainment areas. Legislation being considered on Capitol Hill would provide a common-sense approach for implementing national ambient air quality standards, recognizes ongoing state efforts to improve air quality through a reasonable implementation schedule for the 2015 ozone standards, streamlines the air permitting process for businesses to expand operations and create jobs, and includes other reforms that bring more regulatory certainty to federal air quality standards. 20
EPAS WOTUS FINAL RULE On June 29, 2015, EPA and the U.S. Army Corps of Engineers issued their final Waters of the U.S. final rule (80 Fed. Reg. 37,054). The rule became effective on August 28. The rule has implications for any entity regulated under the Clean Water Act (CWA), including construction, manufacturing, mining, agricultural, and energy development. It dramatically expands the number and types of waters subject to regulation under the CWA, as this definition establishes the scope of federal jurisdiction over U.S. waters. Where federal jurisdiction exists, federal permits will be necessary for a number of activities impacting these waters, including filling, dredging, discharging into, or modifying flow. This new definition of waters will also be incorporated into regulations under several other environmental laws, including the Clean Air Act, the Resource Conservation and Recovery Act, and the Comprehensive Environmental Response, Compensation, and Liability Act. Numerous states have filed suit over the rule. Additional litigants are a virtual certainty. Congress continues to consider legislation to scrap the final rule. 21
EPAS RMP REVIEW/RULEMAKING EPA and OSHA, respectively, are moving forward aggressively to implement significant revisions to their Risk Management Plan (RMP) and Process Safety Management (PSM) rules that apply to facilities that use extremely hazardous substances. The agencies actions are in response to an Executive Order (EO), EO 13650, which President Obama issued on August 1, 2013, in response to an April 2013 explosion at a fertilizer facility in West, Texas, that killed 15 people and injured many others. In December 2013, OSHA announced that it was considering significant revisions to its PSM rule ("Process Safety Management and Prevention of Major Chemical Accidents ), which contains requirements for the management of hazards associated with processes using highly hazardous chemicals. On July 31, 2014, EPA announced that it was considering significant revisions to its RMP rule, which requires facilities that use extremely hazardous substances to develop an RMP. Both announcements came as a request for information (RFI). An RFI is frequently a federal agency's first public acknowledgment that it intends to pursue rulemaking. (continued) 22
EPAS RMP REVIEW/RULEMAKING (Concluded) OSHA, EPA, and DHS are leading a Working Group established by EO 13650 to identify areas for regulatory reform. Given the broad applicability of the PSM and RMP standards across many industrial sectors, including the coke industry, future rulemakings of the sort contemplated by OSHA and EPA, respectively, could have significant operational and economic effects. On March 14, 2016, EPA published in the Federal Register a proposed rule that would make major changes to the accident prevention, emergency response and public availability of chemical hazard information requirements under its RMP regulations. Comments are due on the proposed rule by May 13, 2016. On March 14, ACCCI joined a number of other associations in requesting a 30-day extension to this deadline, to June 13; EPA declined to grant an extension. The COETF and ACCCI s MESH Environmental Subcommittee are considering next steps. 23
PEER PETITION REGARDING EPAS RCRA CORROSIVITY CHARACTERISTIC The Public Employees for Environmental Responsibility (PEER) has petitioned EPA to lower the upper limit of the RCRA Corrosivity Characteristic (used to identify hazardous wastes) from pH 12.5 to pH 11.5, a 10-fold reduction; and, and to extend the standard to solid, as well as liquid materials. ACCCI has joined a 17-association coalition that is assisting EPA in evaluating the petition. In a September 30, 2015, letter to EPA, the coalition argued that: a rule that met the petitioners requests needlessly would subject an enormous quantity of materials, many of which currently are safely used for productive purposes, to RCRA hazardous waste requirements with no corresponding benefit in the form of improved worker, public, or environmental safety. In fact, amending the corrosivity characteristic as requested would result in classifying as hazardous millions of tons more material than could be accommodated in currently available Subtitle C landfills. On April 11, 2016, EPA published in the Federal Register a tentative decision to deny the PEER petition request to amend the RCRA corrosivity characteristic. The coalition plans to submit supportive comments, which are due by June 10, 2016. 24
PRINCIPAL REGULATORY CONCERNS OF CONCERN TO THE COAL CHEMICALS INDUSTRY State/local legislation that would ban coal tar-based sealants EPA indications that it may use coal-tar based coatings an eligibility issue in CWA permitting 25
STATE/LOCAL LEGISLATION THAT WOULD BAN USE OF COAL TAR-BASED SEALANTS Legislation that would ban use of coal tar-based sealants has been enacted or is being considered in various states/localities (e.g., NY, MI, MN, IL, ME, Chicago). Legislation is being driven by USGS scientists and handful of environmental activists and media. The Pavement Coatings Technology Council (PCTC) continues to push back aggressively on proposed bans, adverse publicity. PCTC is encouraging ACCCI to do more. ACCCI s Coal Chemicals Committee is undertaking two projects focused on "increasing awareness about the true hazards of coal tar and coal tar pitch. The projects, which are being undertaken by ARCADIS U.S., Inc., include performing a critical review of human studies/reports on coal tar and coal tar pitch (dermal exposures); and, testing for antagonism among PAHs in coal tar. 26
EPA INDICATIONS THAT IT MAY USE COAL-TAR BASED COATINGS AN ELIGIBILITY ISSUE IN CWA PERMITTING In a new Fact Sheet, the USGS indicates that coal-tar-based pavement sealcoat is a potential concerns for human health and aquatic life. Counsel to a Clean Water Act (CWA)-focused coalition of which ACCCI is a member reports that EPA had indicated it may make using coal-tar based coatings an eligibility issue in CWA permitting. 27
OTHER IMPORTANT REGULATORY AFFAIRS ISSUES EPA Rulemakings/Issues EPA s February 25, 2016, Direct Final Rule to Clarify Requirements Associated with Training Courses for Method 303 EPA s Boiler MACT and CISWI Final Rules, and Related Litigation EPA s Final SO2 NAAQS NAAQS Implementation Issues EPA s Environmental Justice (EJ) Program Toxic Substances Control Act (TSCA) Legislation OSHA Rulemakings/Issues OSHA s Final Silica Rule OSHA s Injury and Illness Protection Program Other Issues 28 Chemical Security Legislation
QUESTIONS? 29
