Some 300 different producers of emissions may be subject to the state’s first rules aimed at limiting toxic air contaminants — businesses that range from oil-and-gas companies to cement and steel manufacturers to biogas facilities that are turning waste into energy.
Colorado Department of Public Health and Environment officials, who in September approved the health-based standards for five priority toxic air contaminants, are in the early stages of adopting control regulations to reduce emissions of these air pollutants. They must submit a permitting-needs assessment report to the Legislature by the end of this year and then adopt strategies to control the increase of those emissions by April — strategies that could include permitting regulations if approved by the General Assembly.
Like with many of the air-quality regulations that CDPHE has adopted over the past three years, the oil-and-gas sector would be impacted the most, as two of the five priority TACs, benzene and formaldehyde, emanate largely from upstream or midstream facilities. As such, two major industry associations already are warning that what appear to be very tight regulation strategies could be very expensive to comply with — and potentially could work against existing rules mandating reductions in ozone precursors.
“We think the impact could potentially be sizable,” said Ryan Steadley, vice president of regulatory affairs for the Colorado Oil & Gas Association. “What we see could be potentially wide-ranging in its impacts — not just in the oil-and-gas industry, but across the board.”
Tension between producers and environmentalists
But community activists, who expressed disappointment that the Colorado Air Quality Control Commission did not set more conservative health-based standards on the TACs, are mobilizing already and asking state regulators to be aggressive with the new rules. Strict regulations are needed especially in disproportionately impacted communities — those poorer and often more heavily minority-populated areas that often have been subject to higher levels of pollution in the past — they have said.
“(Corporations) have access to the brightest engineers, the greatest advances in equipment and unlimited financial resources,” Harmony Cummings, executive director of the Green House Connection Center in north Denver, said at an Oct. 22 CDPHE public meeting on potential TAC emission-control regulation strategies. “They can and they need to do better, and we need the government to make them do so.”
The five priority TACS that the AQCC identified in a January rulemaking are benzene, formaldehyde, ethylene oxide, hydrogen sulfide and hexavalent chromium compounds. CDPHE officials have proposed emission thresholds of 10,000 pounds per year for hydrogen sulfide, 4,000 pounds per year for benzene and formaldehyde and four pounds per year for ethylene oxide — thresholds above which emissions would be subject to regulation. For hexavalent chromium compounds, any emission would be regulated.
Those levels are proposed to be lower than the federal standards for hazardous air pollutants (which all except for hydrogen sulfide are regulated as) so that the rules are not duplicative to federal regulations, according to a CDPHE document. They also are higher in most cases than the previously established health-based standards, which are meant to identify health risks for monitoring purposes, explained Amanda Damweber, CDPHE air toxics regulations supervisor.
A look at who emits toxic air contaminants
Here is a snapshot of which sectors and companies are believed to have emissions above the thresholds for each TAC and could be subject to new regulations, according to CDPHE:
- Formaldehyde, which is emitted largely from spark ignition engines and gas-fired turbines, is released at levels above thresholds by 244 sources, 95% of which are in the oil-and-gas sector. But furnaces, equipment and storage ponds also could push numerous manufacturing plants — including Evraz Rocky Mountain Steel in Pueblo, Western Sugar Co. in Fort Morgan and both CoorsTek locations — under the new rules too.
- Benzene exceeds proposed levels at 36 sources, most of which are in the upstream and midstream segments of the oil and gas industry. But the pollutant also comes from the petroleum processing done at the Suncor refinery in Commerce City, three cement-manufacturing plants and a water-treatment facility that concentrates on treatment and storage of water from oil-and-gas production.
- Hexavalent chromium compounds exceed proposed levels at 14 locations specializing in chromium plating and anodizing, which involves metal being dipped into a bath of hexavalent chromium to prevent corrosion and wear. The TAC also comes from coal-fired power plants, but all but one such plant in the state is slated to close by 2031.
- Four sources emit hydrogen sulfide at levels above proposed limits. Two are asphalt and asphalt-roofing product-manufacturing plants — the Owens Corning Denver Roofing Plant and the Owens Corning Trumbull Asphalt Plant. The other two are biogas facilities generating energy from mammal waste — Platte River Biogas in LaSalle and the South Platte Renewals wastewater treatment facility in Englewood.
- Three sources exceed proposed ethylene oxide limits, all of which are medical-sterilization plants, including the Terumo BCT campus in Lakewood. CDPHE proposed that those plants be required to comply with federal regulations developed in 2024. But it also acknowledged that if the U.S. Environmental Protection Agency reconsiders those rules, as it has discussed doing, then the state will need to step in with its own regulations.
How the state plans to rein in emissions
Pathways to compliance for affected companies to get under emissions limitations could include installation of control technologies, substitution of materials that produce fewer TAC emissions and changes in their processes.
That could lead to prohibition of certain process — officials at the Oct. 22 meeting suggested a potential ban on new or modified chrome-plating operations and limits on new or modified spark-emission engines and turbines — as well as more testing and reporting. And emission controls could get very facility-specific, such as mandated installation of impermeable geomembrane floating covers over manure pits at biogas facilities and limits on the amount of time that waste can be stored in such pits.
Because of staff limitations, CDPHE also would look to prioritize enforcement in disproportionately impacted communities with multiple sources air toxins, Damweber said at the Oct. 22 meeting. And it would focus compliance on existing categories of sources for the TACs that are known to have excessive emissions.
Potentially impacted companies are studying the proposals, but there already is concern that some compliance strategies could be fiscally or technically infeasible, said both Steadley and Carly West, executive director of American Petroleum Institute Colorado.
Could regulation of toxic pollutants lead to more greenhouse-gas emissions?
West noted that the concept rules are similar to those in Oregon, where companies from many industries have reported that they are expensive to comply with and that they slow down permitting. Slowing permitting any more in Colorado could be a potentially fatal blow to companies’ continued operations here, as air-quality permits already take more than a year on average to get.
Steadley also noted that while concentration of these TACs is falling already as oil-and-gas companies seek to comply with 2023 rules mandating reductions in nitrous oxide and volatile organic compounds, there comes a point when reduction of one pollutant will lead to an increase in another.
“If the division finalizes a rule that essentially paints you into a corner where in order to comply with one you cannot comply with another, that’s an untenable situation,” he said.
While the AQCC is required by a 2022 law to adopt emission-control regulations by April 30, legislators must grant the commission authority if it intends to do that through permitting restrictions, industry observers have said. Thus, some business leaders have suggested a push to ask the Legislature to take no action.
What happens next
That surely will be countered by groups like Cummings’, which have argued that the 2022 law already got watered down as it went through the legislative process and that the state has been too lax in its enforcement of other pollution regulations. Thus, there will be a strong push coming from environmentalists to tie the standards to permitting and to ensure that extraction and industrial operations cut emissions if they are to continue operating.
“There are profits on the one side, but there are people on the other side,” Cummings said. “And for far too long, the scales have been unbalanced against the people.”
West and Steadley argued that before the state begins creating yet another new set of rules for companies to follow, it needs to establish that the problems being created by TACS are significant enough to warrant new restrictions on businesses. And with the state only recently having released its initial findings from TAC monitoring — results showing that wildfires and biogenics, or living organisms, are responsible for a not-insignificant portion of the TAC emissions — it hasn’t made that case yet, they said.
“It’s a lot of moving pieces all happening at once around air toxics,” West said. “It’s a little premature, and there’s not a demonstrated need for a permitting program.”
The next formal step in the process is likely to come in December, when CDPHE officials are likely to ask the AQCC to set an April hearing to adopt TAC emissions-control strategies.