By Maureen N. Harbourt

Facilities subject to a Part 70 air operating permit are afforded an “affirmative defense” to liability for civil penalties for releases to air that exceed technology-based permit limitations, provided they strictly adhere to both the requirements of the “upset” rule in LAC 33:III.507.J and General Condition N of the Part 70 General Permit Conditions referenced in the permit.  Because the rule puts the burden of proof on the permittee, successfully asserting the upset defense depends on documenting that each aspect of the defense is satisfied.  Subsection 507.J.1 of the rule defines an “upset” as “any situation arising from sudden and reasonably unforeseeable events beyond the control of the owner or operator, including acts of God, which situation requires immediate corrective action to restore normal operation and that causes the source to exceed a technology-based emissions limitation under the permit due to unavoidable increases in emissions attributable to the situation.”  (Emphasis added.) It goes on to provide that “[a]n upset shall not include noncompliance to the extent caused by improperly designed equipment, lack of preventative maintenance, careless or improper operation, or operator error.”

The four essential requirements for documenting that an upset has occurred are stated in Section 507.J.2 as:

  1. an upset occurred and that the owner or operator can identify the cause(s) of the upset;
  2. the permitted facility was at the time being properly operated;
  3. during the period of the upset the operator took all reasonable steps to minimize levels of emissions that exceeded the emissions standards and other requirements in the permit; and
  4. the owner or operator notified the permitting authority in accordance with LAC 33:I.Chapter 39.

Many facilities risk losing the protection of this affirmative upset defense by following only the reporting requirements of LAC 33:I.Ch. 39 (the LDEQ general release reporting rules), while ignoring the reporting requirements of General Condition N of the permit.  The reporting requirements of Chapter 39 require reporting only if the release exceeds a reportable quantity (“RQ”) or causes an emergency condition; however, the upset defense can also apply to releases below an RQ.  Further, Chapter 39 requires a written follow-up report only within 7 calendar days, whereas General Condition N of the permit is more stringent and requires the assertion of the upset defense within 2 working days.  Guidance published by the Louisiana Department of Environmental Quality (“LDEQ”) concerning General Condition N states:

In the event a permittee seeks to reserve a claim of an affirmative defense as provided in LAC 33:III.507.J.2, the required notification shall be submitted in writing within 2 working days of the time when emission limitations were exceeded due to the occurrence of an upset. The written notification may be faxed to meet the deadline. Verbal notification alone is not acceptable.

(Emphasis added.) We believe that an e-mail within 2 days would also meet the General Condition N requirement for written notification. Thus, for releases above an RQ, facilities desiring to preserve the upset defense should either file the written report required by Ch. 39 early (within 2 working days), or should develop a standard upset notification report addressing all Section 507.J requirements to fax or e-mail to LDEQ within 2 working days.  For releases below an RQ that do not require reporting under Ch. 39, an upset notification meeting the Section 507.J should be either faxed or e-mailed to LDEQ.

Another common error that facilities make is related to potential confusion about Ch. 39 requirements.  The provisions of LAC 33:I.3925.B.14 specify that the required written unauthorized discharge report must include “a determination by the discharger of whether or not the discharge was preventable, or if not, an explanation of why the discharge was not preventable.” Some permittees believe that an assertion that the discharge “was not preventable” is the equivalent of asserting the upset defense, but such may not be sufficient to specifically identify the event as an upset.  If the Ch. 39 written report is also going to serve as the General Condition N written assertion of the upset defense, it is recommended that the Ch. 39 report clearly state that the permittee believes the discharge was not preventable and that the event meets the definition of an upset under LAC 33:III.507.J.  The dual Ch. 39/General Condition N report should also include a description of why the event meets the upset defense.

Often initial information is indicative that an event causing excess emissions is an upset, but confirmation of that fact may come only after a root cause analysis or similar investigation.  The Ch. 39 rules allow a facility to state in the initial written report that information is not yet available to answer all of the questions required for the Section 3925 written report and to submit “updates of the status of the ongoing investigation of the unauthorized discharge …every 60 days until the investigation has been completed and the results of the investigation have been submitted.” LAC 33:I.3925.A.3.  However, General Condition N does not afford this leeway.  If an incident is suspected to be an upset, the facility should provide the 2 working day notice required by General Condition N, with an assertion that the event was an upset and a preliminary determination as to the cause.  The facility should also include a statement describing any efforts to minimize the emissions and asserting that the facility was being properly operated at the time of the event. Such General Condition N report can be updated to either confirm or withdraw the assertion of the upset defense when the investigation is completed.

The written report for any upset, in order to satisfy General Condition N, should also specify the technology-based permit limit that is subject to the upset defense.  Section 507.J does not allow an affirmative defense for permit limits based on ambient standards or any basis other than technology.  Technology-based limits are those established as Maximum Achievable Control Technology (“MACT”) under a National Emissions Standard for Hazardous Air Pollutants (“NESHAP”); Best Available Control Technology (“BACT”) under a Prevention of Significant Deterioration Permit; New Source Performance Standards (“NSPS”); Reasonably Available Control Technology (“RACT”) under a State Implementation Plan (such as the waste gas disposal rule in LAC 33:III.2115) and the like.  Pound per hour and ton per year emission limits in the permit designed to meet these technology-based standards should be considered as technology-based limits.  Section 507.J does state that the “upset defense” is not applicable to acid rain emission limitations (from 40 C.F.R. Parts 72-75).

Finally, Section 507.J.4 states that the upset defense is “in addition to any emergency or upset provisions contained in any applicable requirement.”  However, certain applicable requirements may preclude the upset defense, such as a NESHAP rule that specifically states that the requirement applies even during a malfunction (which term is described in the General Provisions of 40 C.F.R. Part 63, Subpart A, almost identically to the definition of “upset” in 507.J).  Thus, a facility should be aware that the upset defense may not be available in such circumstances.  In other cases, a NESHAP rule will provide that it is not applicable to malfunction events, but there may be additional requirements under such NESHAP rule for demonstrating that the event was caused by a malfunction (such as following a startup, shutdown, malfunction plan and/or properly reporting the malfunction under the NESHAP rule).  These NESHAP provisions are not superseded by the Louisiana upset defense rule in Section 507.J.