## Facts

- Northern Michigan University sought a federal Prevention of Significant Deterioration (PSD) permit to construct and operate a new circulating fluidized-bed boiler at its Ripley Heating Plant in Marquette, Michigan, capable of burning wood chips, coal, and natural gas.
- The Michigan Department of Environmental Quality (MDEQ), acting as the permitting authority, issued the PSD permit on May 12, 2008.
- The permit authorized high-sulfur coal as the primary fuel for most of each month, with wood used as primary fuel for a smaller portion of the month.
- In the permit record, NMU and MDEQ relied on asserted site and operational constraints to justify predominant coal use, including limited fuel-storage space and claimed seasonal disruptions in wood deliveries.
- Sierra Club petitioned the Environmental Appeals Board (EAB) on June 13, 2008, challenging the permit, including the Best Available Control Technology (BACT) determinations for pollutants such as SO₂, PM₂.₅, and CO₂.
- The record reflected reliance on state BACT guidance that departed from EPA’s standard “top-down” BACT methodology described in EPA’s NSR Manual.
- The EAB issued its decision on February 18, 2009, granting review in part and remanding specific issues to MDEQ while denying review of the remaining challenges.

## Issues

1. Whether MDEQ’s BACT determinations for SO₂, PM₂.₅, and CO₂ complied with PSD requirements, including proper use of the top-down BACT methodology.
2. Whether MDEQ adequately supported, with record evidence and reasoned explanation, its reliance on fuel-storage and fuel-supply constraints to reject greater wood use and justify predominant burning of higher-sulfur coal.
3. Whether the permit record adequately addressed CO₂ under PSD/BACT in light of EAB guidance requiring reasoned consideration of greenhouse gas control obligations.

## Decision

- The EAB granted review in part and remanded certain aspects of the PSD permit to MDEQ for further action; it denied review as to the remaining issues.
- The EAB required MDEQ to revisit portions of the BACT analysis where the record did not clearly demonstrate a proper top-down evaluation, including aspects tied to fuel choice.
- The EAB directed MDEQ to reconsider its treatment of CO₂ and to provide a reasoned explanation consistent with then-recent EAB guidance on whether CO₂ must be addressed in BACT.
- The EAB declined to review objections that did not meet the applicable threshold for review or did not demonstrate legal error or lack of record support.

## Legal Principles

- Under PSD, BACT determinations should follow a “top-down” approach: identify all available controls, eliminate technically infeasible options, rank remaining options by effectiveness, and select the most effective option unless rejected based on demonstrated energy, environmental, or economic impacts.
- A permitting authority may use state guidance, but the permit record must still demonstrate compliance with federal PSD/BACT requirements and provide a clear rationale showing the required analytical steps.
- Fuel choice may fall within the scope of BACT when it materially affects emissions; rejecting a less-polluting fuel based on site-specific constraints requires substantiated record evidence and explicit findings within the top-down framework.
- When petitioners show that key BACT determinations lack record support or a reasoned explanation on material elements, remand is an appropriate remedy; the EAB will not grant review merely to reweigh technical judgments adequately supported in the record.

## Conclusion

The EAB partially remanded the PSD permit because the record did not adequately demonstrate a compliant top-down BACT analysis on key elements, particularly fuel-choice justifications and the treatment of CO₂, while leaving other permit aspects in place where the petition did not establish reviewable error.


In re N. Mich. Univ. Ripley Heating Plant, PSD Appeal No. 08-02 (EAB 2009)