September 6, 2018 PAL – A Better Air Permit

The PAL renewable air permit allows facilities nationwide to better manage emissions through a facility cap opposed to individual equipment.

On July 31, 2018, Wisconsin issued its first Plantwide Applicability Limit (PAL) permit. Normally, a permit issuance would not be ground-breaking news. However, this permit allows a facility to avoid most future construction air permitting for a 10 year period. And, it is available nationwide.

How the PAL can be your pal

The PAL is a 10-year renewable air permit that allows a facility to more effectively manage its air emissions through the use of an emission cap on the facility, as opposed to limits on individual pieces of equipment. For those of you who prefer your information to be more visual, imagine the emissions cap as a giant bubble over your facility. As long as the permitted emissions stay below the cap, you can generally install, modify and move equipment as needed without first having to undertake a Clean Air Act Prevention of Significant Deterioration (PSD) analysis and obtain individual construction permits. In practical terms, what this means is greater flexibility in responding to customer demand.

PAL permits are best suited to manufacturing facilities subject to Clean Air Act requirements, emissions oversight, and governmental controls, and whose emissions of Volatile Organic Compounds (VOCs) and/or Nitrogen Oxides (NOx) are at or above 100 tons per year. But, PAL permits can be issued for other Clean Air Act regulated air emissions as well, such as sulfur dioxide (SO2).

The PAL approach was developed by the United States Environmental Protection Agency in the early 2000s as part of the New Source Review reforms of the Clean Air Act. Each state can have their own PAL program based on the federal program, or can be delegated to issue PAL permits under the federal PAL program. Some states are still in the process of establishing their own PAL program. The familiarity that regulatory agencies in each state may have with PAL permits can vary greatly.

Getting a PAL permit

The PAL permit process starts by reviewing the past ten (10) years of baseline actual emission rates at the facility. Most facilities are already tracking this information for current air permit monitoring and reporting requirements. The PAL emission cap is generally based on the average annual (e.g., baseline) emission rate for a 24-month consecutive period during the prior 10 years of facility operation. An increase threshold for the specific PAL pollutant is then added to the baseline actual emission rate to set the PAL emission cap.

Working with an Environmental attorney who is experienced with the PAL permit process and engaging state regulatory agencies early on will assist in getting everyone comfortable with the baseline emission data and proposed PAL emissions cap level.

The PAL application next will need to be compiled and submitted, including supporting emissions data and submission of any required permit application fees. Then, the PAL permit application review process will commence, which again will likely involve working closely with the state regulatory agency to answer questions and provide additional information as requested.

The costs of obtaining a PAL permit can vary greatly depending on the availability and completeness of emissions data and the complexity of the facility. Additional costs can occur if there are lengthy negotiations with state regulators or robust public comment. However, the benefits of a PAL can be worth the initial effort. The costs of a PAL permit may be recouped fairly quickly, depending on how much capital growth the facility is undertaking. And, the PAL permit has the following additional long-term benefits:

• removing air permitting considerations from capital project planning and execution;
• providing certainty in costs and schedule;
• reducing governmental control and oversight in your production process;
• eliminating uncertainty of permitting interpretation by regulatory agencies;
• aiding in maintaining confidentiality of production methods and processes;
• reducing compliance costs and management time on air permitting issues;
• readily replicated at multiple facilities nationwide; and
• expediting product to market, providing a competitive advantage.

A PAL permit can add savings, consistency, predictability, and confidentiality to facility Clean Air Act permitting – a process known to be cumbersome and time consuming at its best.

Jennifer Van Wie is a special counsel and an environmental business lawyer with the Chicago office of Foley & Lardner LLP, where she advises clients on the PAL permit process, state and federal environmental regulations and laws concerning air, water, and land pollution, including matters specific to the Clean Air Act, Clean Water Act, Resource Conservation and Recovery Act (RCRA), and Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). Prior to joining Foley & Lardner, Ms. Van Wie was an Assistant Attorney General with the Environmental Bureau of the Illinois Attorney General’s Office for more than 12 years. Ms. Van Wie has focused her practice exclusively on environmental issues for more than 14 years. jvanwie@foley.com

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