Chemical Processing Notebook: Bracing for the Regulatory Onslaught

The chemical industry is grappling with a steady influx of new regulations, leaving operators with numerous questions about their implications and how to prepare for compliance. While these regulations are subject to controversy, the industry must contend with the new laws and be ready to address them through various means, including adopting new technologies, enhancing safety practices, and adhering to reporting requirements.

In the latest IndustryWeek Production Pulse livestream event on LinkedIn, several editors from Endeavor Business Media, the parent company of Chemical Processing and IndustryWeek, discussed key regulatory issues and their impact on various economic sectors.

Joining the discussion was Chemical Processing regulatory columnist, Lynn Bergeson, managing partner at Bergeson & Campbell.

IndustryWeek Production Pulse featuring Chemical Processing regulatory columnist Lynn Bergeson:

The following is an edited version of some comments on two of the latest regulations. The first involves the recent updates to the National Emissions Standards for Hazardous Air Pollutants (NESHAP) for six chemicals, including ethylene oxide, chloroprene and vinyl chloride.

Also known as the Hazardous Organic NESHAP (HON), this ruling could have significant implications for more than 200 chemical plants nationwide.

Bergeson also addressed the EPA's designation of two PFAS chemicals, perfluorooctanoic acid (PFOA) and perfluorooctanesulfonic acid (PFOS), as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) on April 19.

This final rule classifies these two PFAS chemicals as hazardous substances under CERCLA, potentially impacting various industries and communities.

Here are some of the paraphrased responses to the panel topics:

Bergeson On the ‘Tsunami of Regulations’

The recent surge in federal regulatory action is driven by two key factors. Firstly, it coincides with the recent Earth Day celebrations, providing an opportune moment to unveil new environmental initiatives.

But the more pressing motivation is to finalize these regulations before the current Congressional session ends. This is to prevent the next Congress from potentially overturning them using the Congressional Review Act. This legislative tool has been employed extensively in previous years to undo regulatory actions that fell within its jurisdictional timeframe.

The EPA is therefore making a concerted push to complete the rulemaking process for regulations it began developing years ago. The urgency stems from wanting to ensure these rules take effect before the Congressional Review Act window closes after the upcoming November elections, which could potentially lead to a change in administration. Releasing this "tsunami of regulations" over the next month allows the EPA to bypass potential Congressional reversal.

Bergeson on the impact that the HON could have on chemical manufacturers:

In addition to higher compliance costs resulting from tighter emissions limits for fugitive and point sources, manufacturers will need to pay to retrofit their facilities to meet those new standards. Furthermore, for manufacturing plants situated in marginalized communities, air emissions and fenceline monitoring must be viewed through the lens of environmental justice concerns. The current EPA administration is intensely focused on examining the disproportionate environmental impacts on disadvantaged areas. Facilities located in such communities could face not only Clean Air Act compliance issues and costs for enhanced monitoring, but also third-party litigation risks to the extent they emit hazardous air pollutants.

Increased enforcement actions by the EPA as well as non-profit organizations and other private parties aiming to drive down emissions even further should be anticipated. One specific HON under intense global scrutiny is ethylene oxide, due to its perceived carcinogenic risks. Producers and users of ethylene oxide, such as sterilizers and healthcare facilities, can expect heightened review and oversight, along with potential third-party litigation stemming from ethylene oxide's emissions and health hazards.

Bob Crossen, editorial director for WaterWorld Magazine, on the latest PFAS rulings:

On April 19 the EPA listed PFOA and PFOS under CERCLA. This allows the agency to pursue legal enforcement actions against entities deemed responsible for PFAS contamination.

While the rule directly impacts PFAS manufacturers, it also has implications for water and wastewater utilities across the country, as they receive these chemicals in their influent streams at drinking water and wastewater treatment plants.

Separately, on April 10, the EPA issued a rule establishing maximum contaminant levels for PFOA and PFOS in drinking water, which utilities must comply with within five years.

Regarding the April 19 CERCLA listing, utilities are concerned about being held liable for PFAS present in their systems that they did not generate but merely received. The EPA issued enforcement discretion guidance stating it does not plan to target utilities, fire departments or airports using PFAS-containing firefighting foam.

But this discretion does not provide full liability protection, as utilities could still face third-party lawsuits from environmental groups over PFAS detections in their drinking water or wastewater streams.

Bergeson’s take on the PFAS ruling:

The EPA's listing of PFOA and PFOS as hazardous substances under CERCLA was an expected move given their toxicity concerns compared to PTFE and other fluoropolymers.

This designation authorizes the federal government to compel cleanups of contamination that threatens human health and the environment.

But many passive recipients of PFAS would have preferred if certain categories outlined in the EPA's enforcement guidance were entirely exempted from CERCLA cleanup liability. These include water systems, storm sewers, public drinking water systems, solid waste landfills, public airports and farms.

The enforcement discretion is not a legally binding rule, but rather guidance, leaving those entities potentially exposed to third-party liability from NGOs or other sources, despite the EPA's intent to protect passive recipients of these pervasive PFAS substances.

As a result, there is concern in the private sector about impending Superfund cleanup liability, third-party litigation, and other liabilities stemming from PFOA and PFOS's hazardous designation under CERCLA. This is expected to reopen closed Superfund sites to address legacy contamination through CERCLA's reopener provisions.

It will also have implications for corrective actions mandated under the Resource Conservation and Recovery Act (RCRA).

While PFOA and PFOS are no longer widely used commercially after being phased out by 3M in the early 2000s and the EPA's PFOA Stewardship Program, historic contamination is expected to be found across the country in soil, water and sediment. This will likely spur substantial private litigation and EPA cleanup actions under CERCLA authority.