Environmental Business Alert
Supreme Court Says Jury, Not Judge, Must Determine Per Day Criminal Violations
On June 21, 2012, the U.S. Supreme Court ruled in Southern Union Co. v. United States, No. 11–94, that factual findings increasing the penalty for a crime beyond the prescribed statutory maximum, such as the number of days a violation occurred, are subject to the Sixth Amendment requirement that they be proven to a jury beyond a reasonable doubt. Extending its holding in Apprendi v. New Jersey, 530 U.S. 466 (2000), the Court reversed and remanded a decision by the Court of Appeals for the First Circuit affirming an $18 million criminal penalty against Southern Union. The company successfully argued that the penalty, imposed for storing liquid mercury without the requisite Resource Recovery and Conservation Act ("RCRA") permit, was unconstitutional because the jury did not specify in its verdict the number of days a violation had occurred. Therefore, Southern Union asserted, the maximum fine was a single day violation of $50,000. Going forward, the Court's holding will require the government to plead and prove with specificity violations that include per day penalties.
EPA Amends Petroleum Refinery NSPS for Flares and Process Heaters
The Office of Management and Budget has approved the U.S. Environmental Protection Agency's ("EPA" or "Agency") final rule amending the NSPS for flares and process heaters at petroleum refineries, to be codified at 40 C.F.R. part 60, subpart Ja. This rule will lift the current stay of effectiveness on the refinery process heater and flare requirements that EPA promulgated on June 24, 2008, but stayed pending reconsideration of three industry petitions. According to an Agency announcement, the final rule will impose concentration- and heating value-based nitrogen oxide ("NOx") emissions limits on process heaters, although a site-specific emission limit will be available as an alternative compliance option. Flares used to burn off waste gases from the refining process will now be subject to a suite of work practice standards and monitoring requirements to reduce emissions of sulfur dioxide, NOx and VOCs. EPA has submitted the rule for publication in the Federal Register.
EPA Extends 2012 Chemical Data Reporting Deadline
The Agency extended the 2012 submission deadline under the Chemical Data Reporting ("CDR") Rule to August 13, 2012. With certain limited exceptions, entities that manufactured or imported for commercial purposes 25,000 pounds or more of a substance listed on the Toxic Substances Control Act ("TSCA") Inventory at a single site during calendar year 2011 must submit electronic reports including manufacturing, recycling, processing and use information by this date. EPA granted the extension because companies have continued to raise critical questions concerning the reportability of byproducts and have experienced technical issues related to electronic filing. This extension does not affect subsequent CDR submission periods that will occur every four years.
EPA Revises VOC Definition to Exclude HFO-1234ze
EPA's Administrator Jackson signed a final rule adding trans-1,3,3,3-tetrafluoropropene, commonly referred to as "HFO-1234ze," to the list of compounds excluded from the definition of volatile organic compounds ("VOCs") at 40 C.F.R. § 51.100(s)(1), promulgated under the Clean Air Act ("CAA"). The Agency acted pursuant to a manufacturer petition demonstrating that HFO-1234ze is less photochemically reactive than ethane, and is not likely to contribute to the formation of ground-level ozone. Industries potentially benefiting from this rule include manufacturers or users of refrigerants, aerosol propellants and blowing agents. Although HFO-1234ze emissions may no longer count towards restricted VOC emissions under State Implementation Plans, they may nevertheless remain subject to state VOC recordkeeping, emissions reporting, photochemical dispersion modeling and inventory requirements. In addition, HFO-1234ze remains subject to use restrictions under the CAA Significant New Alternatives Policy ("SNAP") Program regulating alternatives to substances that have been determined to deplete the stratospheric ozone layer. The rule will take effect 30 days after publication in the Federal Register.
EPA Proposes Reciprocating Internal Combustion Engine NESHAP Revisions
In response to several Petitions for reconsideration, the Agency on June 7, 2012, proposed to revise its National Emission Standards for Hazardous Air Pollutants ("NESHAP") for new and existing stationary reciprocating internal combustion engines ("RICE") at major and area sources of hazardous air pollutants ("HAPs"). The proposed revisions to 40 C.F.R. part 63, subpart ZZZZ would allow owners and operators of 4-stroke rich burn spark ignition ("SI") non-emergency engines currently required to reduce formaldehyde emissions by 76 percent, to reduce total hydrocarbon emissions by 30 percent instead. The proposal also would address the operation of emergency RICE and non-emergency RICE engines during emergencies and for other purposes such as peak shaving, respectively. In addition, EPA is proposing to replace numerical area source emission limits on existing 4-stroke SI engines above 500 horsepower with management practices or equipment standards, depending on whether the engine is "remote from human activity." Finally, the rule would revise the New Source Performance Standard ("NSPS") for stationary internal combustion engines, codified at 40 C.F.R. part 60, subparts IIII and JJJJ, for consistency. EPA will hold a public hearing on the rulemaking on July 10, 2012, and accept public comments until August 9, 2012.