AISI: Navigating recent EPA rulemakings impacting steel

Particulate Matter National Ambient Air Quality Standard

EPA in early February issued its final National Ambient Air Quality Standard (NAAQS) for fine particulate matter (PM2.5). The NAAQS program establishes health-based levels set for six criteria air pollutants that are applied to all major sources across the country through the facility permitting process. The previous primary PM2.5 annual NAAQS had been set at 12 micrograms per cubic meter (μg/m³) in 2012. EPA promulgated a new primary standard of 9 μg/m³.

On behalf of American steel producers, AISI last spring submitted comments to EPA, which argued that the proposed standard could cost the iron and steel sector between $3.1 billion and $9.3 billion in total compliance costs and would make expansion of existing facilities or siting of new facilities more difficult. We also reiterated that the domestic industry already operates under some of the most stringent air standards and we are able to meet these standards while keeping integrated and electric-arc furnace (EAF) steel mills operating around the clock in urban areas. The average background level of PM2.5 is 8 μg/m³ across most of the country, the majority of which comes from natural causes and non-industrial sources. The industry is working with EPA to seek fixes to the complex air permitting process to reduce the challenges to obtaining additional permits under the new more stringent standard.

Cross State Air Pollution Rule

The Cross State Air Pollution Rule (CSAPR) regarding ozone transport, sometimes called the “Good Neighbor Plan,” was promulgated by EPA in June 2023. It imposed regulatory requirements on electric generating units and certain manufacturing facilities —including iron and steel producers — to limit nitrogen oxide (NOx) emissions for the purpose of controlling ground-level ozone in downwind states. For the steel industry, the rule regulated NOX emissions from reheat furnaces and boilers. 

The industry raised concerns, via comments submitted by AISI, regarding EPA’s proposed rule, which would have imposed NOX limits on 11 unit types.  EPA made the final rule more manageable to the industry based on these comments, by removing what we argued would have been technically infeasible requirements. Over the past several months, seven regional appeals courts have acted to stay EPA’s underlying disapproval of states’ air quality implementation plans, effectively halting implementation of CSAPR in more than half of the 23 states the program is designed to cover.

Integrated Iron and Steel Risk and Technology Review Rule

EPA last Monday released a rule specifically focused on steelmaking facilities. The rule imposes limits on hazardous air pollutants (HAPs) from five fugitive emission sources (bell leaks, unplanned bleeder valve openings, planned bleeder valve openings, slag handling and beaching), establishes standards for 13 currently unregulated HAPs, revises two currently regulated HAPs from several different units and sets a requirement to monitor levels of total chromium at facility fence-lines.

Industry submitted substantive data to EPA, and met with the administration to highlight flaws in the proposal where EPA relied on inadequate data and an incorrect understanding of steel production. This advocacy, in addition to successful outreach by Sen. Sherrod Brown (D-Ohio), resulted in the final rule including important modifications to establish technically feasible emission limits. The steel industry is continuing to engage with EPA to ensure the rule is technically sound and achievable.

Taconite Iron Ore Processing Risk and Technology Review Rule

Last month, EPA also issued a final rule imposing air emission limits on the processing of taconite (iron ore) needed for advanced steelmaking. This rule mandated a first-time mercury emission limit for indurating furnaces, which requires installation of unproven control technologies. In January, industry representatives highlighted to EPA that domestically produced iron ore pellets led to much lower emissions than sinter-feed iron ore commonly used in China, Japan, India, and many other countries. AISI submitted comments on the proposed rule last summer which stressed that the rule will be a direct detriment to the steel sector and to steel workers employed both at iron ore mines and steel mills that consume pellets. The industry is now working to determine the best compliance paths as it considers next steps.

New Source Performance Standards for Electric Arc Furnaces

Last summer, EPA issued a final rule revising air emission limits for newly constructed EAF facilities and argon-oxygen decarburization vessels, as well as changing certain requirements for existing EAFs. In particular, the rule imposed more stringent standards on particulate matter for certain units. On Oct. 24, 2023, AISI, jointly with other steel industry groups, filed a petition with the U.S. Court of Appeals for the DC Circuit for review of the rule. Among the key concerns raised by the industry groups are that EPA’s new compliance obligations on existing sources constitute impermissible retroactive rulemaking, EPA’s new opacity and particulate matter limits do not represent the best system of emission reduction adequately demonstrated and EPA’s production-based particulate matter limit is infeasible and inconsistent with the rule-making record. Additionally, industry groups filed a petition for reconsideration of the rule with EPA and submitted two detailed letters to EPA requesting a significant number of technical corrections to the rule. In response to industry letters, EPA recently issued an interim final rulemaking which includes many of the industry’s requested technical corrections.

Regulation of GHGs from Fossil Fuel Power Plants

On May 23, 2023, EPA proposed to regulate GHG emissions from new and existing fossil fuel-fired electric generating units. EPA’s proposal would establish GHG emission limits based on the use of carbon capture, utilization and storage (CCUS) or use of clean hydrogen. The requirements would apply to existing coal-fired and natural gas power plants across the country. While CCUS and clean hydrogen are promising technologies to address climate change, EPA’s regulation would require nationwide adoption of these technologies in a short timeframe or require that the plants cease operation. As a result, EPA’s own analysis anticipates premature closure of a significant number of baseload power plants under the proposed GHG limits. On behalf of the industry, AISI submitted public comments on the rule raising concerns about increased electricity prices and grid reliability issues that could result from these stringent limits. Statements made by EPA senior officials since issuance of the proposal strongly suggest that the final rule, currently under review at the Office of Management and Budget, will focus more on CCUS than hydrogen as the basis for limits and will drop existing gas plants from coverage under the rule. EPA is scheduled to issue the rule in the coming months.

Investigation into Risks Associated with Certain Uses of EAF Slag

The National Academies of Sciences, Engineering and Medicine (NASEM) last November issued its final report to EPA presenting findings from its two-year-long project researching potential human health risks related to unencapsulated beneficial uses of EAF slag in residential settings. Due to uncertainties in existing information, the report stated that NASEM was unable to make an overall characterization of risk related to unencapsulated EAF slag use. The report also identifies additional factors for assessing the possibility of health risks associated with EAF slag use, which include slag particle size, frequency of human contact, chemical composition and use of slag in high pH environments. The report makes recommendations for future research to allow for a better assessment of possible risks from human exposure to EAF slag through beneficial use. AISI and partner associations are working with EPA to ensure industry concerns are addressed as the agency reviews the report findings and considers next steps. 

While these regulations present compliance challenges for domestic steel operations, AISI and our member companies continue to work with EPA to balance our shared goals of and our environmental protection with reasonable regulations —and to ensure that the rules recognize the American industry’s global leadership in clean steel production. As we’ve done in the past, the industry will rise to the challenge, continuing to modernize our plants and find innovative ways to reduce emissions while providing the high-quality steels needed for American economic growth and expansion.