The Foundation Mineral and Energy Law Newsletter
Pennsylvania – Mining
(By Joseph K. Reinhart, Sean M. McGovern, Gina N. Falaschi & Christina Puhnaty)
Preliminary Injunction Granted for RGGI Rule
On July 8, 2022, the Commonwealth Court of Pennsylvania granted a preliminary injunction preventing the State from participating in the Regional Greenhouse Gas Initiative (RGGI) pending resolution of a case. As previously reported in Vol. 39, No. 2 (2022) of this Newsletter, the Pennsylvania Department of Environmental Protection’s (PADEP) CO2 Budget Trading Program rule, which links the commonwealth’s cap-and-trade program to RGGI, was published in the Pennsylvania Bulletin in April 2022. See 52 Pa. Bull. 2471 (Apr. 23, 2022). RGGI is the country’s first regional, market-based cap-and-trade program designed to reduce carbon dioxide (CO2) emissions from fossil fuel-fired electric power generators with a capacity of 25 megawatts or greater that send more than 10% of their annual gross generation to the electric grid.
On April 25, 2022, owners of coal-fired power plants and other stakeholders filed a petition for review and an application for special relief in the form of a temporary injunction, and a group of state lawmakers filed a challenge as well. See Bowfin KeyCon Holdings, LLC v. PADEP, No. 247 MD 2022 (Pa. Commw. Ct. filed Apr. 25, 2022). The commonwealth court held a hearing on May 10 and 11, 2022, on the application for special relief.
Because the commonwealth court had not granted the application for preliminary injunction by July 1, 2022, the date on which compliance was to begin under the rule, sources were obligated to begin tracking CO2 emissions for compliance purposes and planned to participate in the upcoming RGGI CO2 allowance action in September 2022.
On July 8, 2022, the commonwealth court granted a preliminary injunction. The order and opinion enjoined the administration and enforcement of RGGI until further order. The court found there is substantial legal question with respect to whether RGGI is an unconstitutional tax given the revenue expected to be generated versus the cost to administer the regulations. The court also found that the petitioners would face immediate and irreparable harm if the rulemaking is ultimately held invalid because the cost of compliance, including lost profits, would not be recoverable because PADEP and Pennsylvania’s Environmental Quality Board (EQB) enjoy sovereign immunity. The court concluded an injunction is reasonably suited to abate the effects of the rulemaking should it be deemed invalid.
Upon appeal of the preliminary injunction by PADEP and the EQB to the Supreme Court of Pennsylvania, the July 8 ruling was automatically stayed, which occurs as a matter of procedure when a state entity appeals to the supreme court. On July 25, 2022, the commonwealth court reinstated its earlier preliminary injunction ruling that a group of state lawmakers who filed one of two legal challenges against the rule had satisfied their burden of proof to establish the requirements to vacate the stay.
On July 12, 2022, natural gas companies Calpine Corp., Tenaska Westmoreland Management LLC, and Fairless Energy LLC filed a third legal challenge to the rule with arguments similar to those brought in the other two cases. See Calpine Corp. v. PADEP, No. 357 MD 2022 (Pa. Commw. Ct. filed July 12, 2022). Oral argument before the commonwealth court on the merits of these three cases will not likely occur prior to September 2022, at the earliest.
Further information regarding the rule and the history of the rulemaking can be found on PADEP’s RGGI webpage at https://www.dep.pa.gov/Citizens/climate/Pages/RGGI.aspx.
EQB to Finalize Rulemaking on Water Quality Standards for Manganese
The agenda for the August 9, 2022, Pennsylvania Environmental Quality Board (EQB) meeting included a vote on the final rulemaking for water quality standards for manganese in 25 Pa. Code chs. 93 and 96. This rulemaking was prompted by the addition of subsection (j) to section 1920-A of the Administrative Code of 1929, 71 Pa. Stat. § 510-20, by Act 40 of 2017. Act 40 directed the EQB to promulgate regulations under Pennsylvania’s Clean Streams Law, 35 Pa. Stat. §§ 691.1–.1001, and related statutes to require that the water quality criteria for manganese established under 25 Pa. Code ch. 93 be met.
The EQB approved the proposed manganese rule in December 2019 and the Pennsylvania Department of Environmental Protection (PADEP) held three public hearings on the rulemaking in 2020. See Vol. XXXVII, No. 4 (2020); Vol. XXXVII, No. 1 (2020) of this Newsletter. Since the proposed rulemaking, PADEP has met with the Mining and Reclamation Advisory Board, the Aggregate Advisory Board, the Public Water Systems Technical Assistance Center Board, and the Water Resources Advisory Committee to discuss the proposed rule.
The proposed manganese rule adds to table 5 in 25 Pa. Code § 93.8c a numeric water quality criterion for manganese of 0.3 mg/L intended to “protect human health from the neurotoxicological effects of manganese.” Executive Summary at 1. Section 93.8c establishes human health and aquatic life criteria for toxic substances, meaning PADEP is now regulating manganese as a toxic substance. The existing criterion of 1.0 mg/L, which was established in section 93.7 as a water quality criterion, will be deleted. The 0.3 mg/L standard will apply to all surface waters in the commonwealth. PADEP identifies the parties affected by the rule to be “[a]ll persons, groups, or entities with proposed or existing point source discharges of manganese into surface waters of the Commonwealth.” Id. at 3.
PADEP also specifically identifies “[p]ersons who discharge wastewater containing manganese from mining activities” as affected parties, and expects mining operators to have to perform additional treatment to meet this new criterion. Id. Final amendments to treatment systems will be implemented through PADEP’s permitting process and other approval actions. Consulting and engineering firm Tetra Tech estimated the overall cost to the mining industry to achieve compliance with the 0.3 mg/L criterion “could range between $44–$88 million in annual costs (that is, for active treatment systems using chemical addition for manganese removal) and upwards of $200 million in capital costs.” Comment and Response Document at 213.
The proposed manganese rule had included language supporting two alternative points of compliance for the proposed manganese criterion. The first alternative proposed to move the point of compliance to the point of all surface potable water supply withdrawals. The second alternative proposed to maintain the point of compliance in all surface waters at the point of discharge. PADEP received over 800 comments supporting maintaining the point of compliance at the point of discharge and in the final rulemaking has removed the first alternative option.
The EQB was scheduled to vote on the final rulemaking at its August 9, 2022, meeting. If the EQB adopts the regulation as final, it will then be sent to the House and Senate Environmental Resources and Energy standing committees and the Independent Regulatory Review Commission for approval. If approved, the regulation then goes to the Attorney General’s Office for final approval before being published in the Pennsylvania Bulletin. The EQB meeting agenda and other materials can be found at https://www.dep.pa.gov/PublicParticipation/Environmental Quality/Pages/2022-Meetings.aspx.
PADEP Finalizes Cap and Liner Guidance for Coal Refuse Disposal Areas
On May 28, 2022, the Pennsylvania Department of Environmental Protection (PADEP) finalized the draft technical guidance that explains PADEP’s considerations when evaluating liners and cap systems installed at coal refuse disposal areas (CRDAs) that was discussed in Vol. XXXVIII, No. 4 (2021) of this Newsletter. See PADEP, Final Technical Guidance Document—Liners and Caps for Coal Refuse Disposal Areas (May 28, 2022). The purpose of the guidance document is to “explain[] the procedures that [PADEP] will use in approving liners and caps for facility designs and the criteria for as-built certifications for [CRDAs].” Id. PADEP issued a comment and response document with the final guidance. See PADEP, Comment and Response Document (May 28, 2022).
Commenters raised concerns with the extent to which PADEP could enforce the requirements in the guidance document because the document is cited in the regulatory text at 25 Pa. Code § 90.50. PADEP, however, explained that this reference does not make the guidance document binding, as “[g]uidance does not rise to the level of regulation because it is possible to deviate from guidance as necessary.” Comment and Response Document at 5.
PADEP also clarified that it is not the agency’s intent to revisit CRDAs that are already reclaimed and have achieved their final configuration and vegetation. Id. Where final configuration and vegetation has not yet been achieved, however, PADEP will require that “the operation is completed with a minimum combined thickness of 4 feet of cover, or a demonstration that the previously approved cover material and thickness will be as effective as 4 feet of combined thickness as per [25 Pa. Code § 90.125(c)].” Id. The guidance document does not acknowledge the waiver in section 90.125(c) for “coal refuse disposal areas permitted prior to July 27, 1991 if the requirements of [25 Pa. Code §§ 90.150–.157 and 90.159–.165] can be attained.” Id. at 13.
In response to one comment pointing out that section 90.50 does not explicitly distinguish between liners and caps, PADEP clarified that the agency’s main purpose in issuing this revised guidance is “to incorporate caps because they are necessary components of most permits under the requirements of Chapter 90.” Id. at 4.
PADEP also reiterated its position that clay layers as a cap are not typically suitable for “circumstances with high hydraulic head conditions, slurry impoundments or as a permanent cap for any coal refuse,” but applicants will have the opportunity to make a demonstration that a clay cap is at least as effective as a synthetic one. Id. at 7. PADEP also reiterated that synthetic liners currently constitute the “best available technology currently feasible.” Id. at 14. Additionally, PADEP revised the guidance to require a minimum hydraulic conductivity for “low hydraulic conductivity soils” (clay) of 1 x 10-7 cm/sec. Id. at 10.
The final technical guidance document was effective upon issuance on May 28, 2022.
OSMRE Approves Amendments to Pennsylvania’s Regulatory Program for Beneficial Use of Coal Ash
Effective May 12, 2022, the Office of Surface Mining Reclamation and Enforcement (OSMRE) approved amendments to the Pennsylvania regulatory program under the Surface Mining Control and Reclamation Act of 1977 (SMCRA). See 87 Fed. Reg. 21,561 (Apr. 12, 2022). The Pennsylvania Department of Environmental Protection (PADEP) submitted the amendments to OSMRE for approval in 2012, and years of correspondence between the agencies followed. OSMRE determined that Pennsylvania’s proposed regulations are in accordance with SMCRA and not inconsistent with the federal regulations implementing SMCRA. By approving the amendments, OSMRE is amending the federal regulations at 30 C.F.R. pt. 938, which codify decisions concerning the Pennsylvania program, to include these amendments to the Pennsylvania program.
The amendments to the Pennsylvania program are related to the beneficial use of coal ash at active surface coal mining sites. OSMRE identified key provisions of the amendments as “operating requirements for beneficial use, including certification guidelines for chemical and physical properties of coal ash beneficially used and water quality monitoring requirements.” 87 Fed. Reg. at 21,562.
The amendments include adding definitions to 25 Pa. Code chs. 287 and 290 as well as adding sections to chapter 290 that included the following, among others: general requirements for beneficial use (§ 290.101); beneficial use at coal mining activity sites (§ 290.104); coal ash certification (§ 290.201); exceedance of certification requirements (§ 290.203); water quality monitoring (§ 290.301); requirements for monitoring points (§ 290.302); and standards for wells and casing of wells (§ 290.303).
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