Re: Docket R98-29; Docket R99-18; Used Oil Regulations

RECEIVED

CLERK’S OFFICE

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May 6,

1999

Illinois Pollution Control Board

100 West Randolph

Chicago, Illinois

60601

Re:

Docket R98-29; Docket R99-18; Used Oil Regulations

Ladies and Gentlemen:

The National Oil Recyclers Association (“NORA”) submits the following

additional comments

on proposed amendments to 35 Illinois Adm. Code Parts

807 and 809.

These comments supplement those submitted by NORA on April 8,

1999.

NORA’s supplementary comments are principally in response to the

February 25, 1999 testimony of Theodore Dragovich, an official with the Illinois

Environmental Protection Agency (“IEPA”), before the Illinois Pollution Control

Board.

In his testimony, Mr. Dragovich states that the proposed change is

designed to increase environmental protection and encourage recycling.

Unfortunately,

IEPA’s proposal will have precisely the opposite effect.

In large

measure this is because, the Agency’s proposal

is a reaction to problems that

existed in the late 1970s and early 1980s, rather than conditions which have

existed since the implementation of the used oil management standards.

40 CFR

Part 279; 35 Ill. Adm.

Code Part 739.

Mr. Dragovich states that many used oil management facilities that accept

large volumes of used oil have historically had environmental problems.

At best,

this

is a half-truth, which like most half-truths, is highly misleading.

It ignores

all regulatory experience in the oil recycling arena since 1985 including, for

example, the implementation and enforcement of the used oil management

NORA’s Supplementary Comments on Used Oil Regulations by IEPA

May 6, 1999

Page 2

standards, SPCC regulations and the Oil Pollution Act.

The prevailing practices

in the oil recycling industry prior to 1980 bear little resemblance to the operations

in 1999.

Numerous factors have contributed to this transformation.

First, the enforcement of federal and state Superfund laws have closed

many oil recycling operations.

The enforcement of such laws against used oil

generators has compelled many of them to demand that their recyclers operate

safely and in compliance with all applicable environmental regulations.

addition, these generators, various trade associations, and insurance companies

have initiated systematic “compliance audits” of processing facilities to ensure

that liability risks would be minimized.

Second, EPA’s promulgation of the “specification” standard for used oil

fuel (and the ability of processors to efficiently produce such fuel) virtually

eliminated the demand for “off-spec” fuel.

Consequently,

the oil recycling

industry focused on producing cleaner (specification) fuel products

to the

exclusion of almost all off-spec products.

Third, the removal of lead from gasoline in the late 1980s resulted in the

virtual elimination of lead from used oil.

Fourth, re-refining operations, once a widespread industrial activity, were

largely terminated by the late 1980s because the increasingly high cost of re-

refining made it impossible to compete with virgin lubricants.

Re-refining

operations are inherently more complicated and produce much greater quantities

of waste materials than fuel processing.

Fifth, the used oil management standards, promulgated in 1985 and

expanded in 1992, mandate numerous regulatory safeguards that were not

“standard operating procedure”

in the 1970s and early 1980s.

These safeguards

include the general prohibition on mixing used oil and hazardous waste, the

rebuttable presumption, and requirements for waste analysis plans and

procedures.

Sixth, used oil processing facilities are required to provide secondary

containment in storage areas and that such secondary containment be

impervious to oil

—

a requirement exceeding the secondary containment rules for

virgin oil storage or storage of more volatile products such as gasoline.

Moreover, the used oil management standards are augmented by the

requirements set forth in SPCC plans and the federal Oil Pollution Act.

NORA’s

Supplementary Comments on Used Oil Regulations by

IEPA

May 6, 1999

Page 3

Seventh, for regulatory, liability and economic reasons, on-site disposal of

sludge at oil processing facilities --once a widespread practice

has been all but

eliminated.

Eighth, the emerging availability of affordable commercial wastewater

disposal options in the 1980s and 1990s has dramatically reduced on-site disposal

of wastewater at used oil processing facilities.

As late as the 1970s this was a

normal and widespread practice.

Significantly, Mr. Dragovich’s testimony failed to identify a single

actual

problem that would not be addressed by the used oil management standards.

Rather than address an actual problem, Mr. Dragovich provides the example that

“Part 739 requires facilities to store used oil in tanks that are in ‘good condition.’

This performance standard does not prescribe methods for ensuring that the

tanks

meet this standard, such as appropriate design, construction, maintenance,

and inspection.”

It should be emphasized that the “ingood condition” is not the

only aspect of this performance standard.

Part 739.154 defines “good condition”

as “no severe rusting, apparent structural defects or deterioration, and no visible

leaking.”

It is highly probable that a tank that exhibits no severe rusting,

structural defects, deterioration or leaking will serve its basic purpose, i.e., to

properly contain the oil that has been placed in it.

Mr. Dragovich’s testimony also fails to mention that the used oil

management standards require a used oil processor to maintain and operate the

facility to minimize the possibility of a fire, explosion or any unplanned release

of used oil which could affect human health or the environment.

(These

requirements are in addition to those requiring facilities to maintain alarm

systems, emergency communications systems, fire-fighting equipment and to

prepare and maintain emergency response plans.)

The used oil management

standards also mandate immediate remedial action if a spill does occur.

If IEPA

believes that performance standards

—

as opposed to design standards

—

will

never be effective in assuring environmental protection, it should proceed to

remove the thousands of performance standards that it has promulgated.

In this

context, if IEPA believes that a performance standard is inadequate, it should

provide real world examples of how the currently applicable performance

standard was incapable of addressing those examples.

Mr. Dragovich’s testimony also focuses on the quality of used oil fuel.

acknowledges that “the

used oil specification in Part739 limits hazardous

constituents in on-specification oil to levels which may be found in similar virgin

oils.”

However, because the specification “does not have limitations on bottom

sediment and water or other parameters...there is no guarantee that that on-spec

NORA’s Supplementary Comments on Used Oil Regulations by IEPA

May 6,

1999

Page 4

used oil will have economic value and thus be properly managed.”

Because

there is no such guarantee, Mr. Dragovichconcludes that “there have been used

oil management facilities in the superfund or other remediation programs.”

Although NORA agrees that a product such as used oil thathas economic

value will be properly managed, we do not believe it is either appropriate or a

good use of IEPA’s resources to regulate product specifications.

Currently,

certainparameters such as minimum BTU content, ash, and bottom sediment &

water (“BS&W”) are governed by the contractual arrangement between the

processor and the burner.

The factors controlling these parameters are the

capability of the boiler or furnace and the price of the fuel.

A blast furnace in a steel mill is quite capable of handling fuel with higher

levels of BS&W and the steel mill prefers burning cheaper fuel.

Where there is

environmental issue involving air emissions, is it good policy for IEPA to

restrict the type of used oil fuel the steel mill may burn?

Hamburger with a high

fat content may not possess the quality of low-fat hamburger meat, but the

government does not

try

to restrict consumers from buying this product.

In the

absence of any demonstrable environmental benefit, NORA contends that any

attempt by IEPA to prohibit or otherwise restrict the processing, selling or

burning of specification fuel is unwarranted.

It should be reiterated that EPA has

determined

and JEPA agrees

that specification used oil fuel is the equivalent

ofvirgin oil fuel in terms of its effect on the environment.

See

50 Fed. Reg.

49189

(November 29, 1985).

See also R.R.

Donnelley & Sons

Co. v. Illinois Environmental

Protection Agency,

Illinois pollution Control Board 88-79 at pp.

3-4 (February 23,

1989) (used oil handled as product is not a solid waste).

Consequently, NORA

would simply ask for IEPA to identify post -1992 examples of Illinois used oil

processing facilities that have experienced environmental problems because their

specification used oil fuel contained elevated levels of BS&W

—

or any other

parameter not set by Part 739.

There are numerous practical problems that flow from a requirement that

storage tanks containing specification fuel be subject to permits.

Transfer

facilities and leased tanks would be required to obtain permits.

Few, if any,

owners of tanks otherwise available for lease would be willing to obtain a permit

(and assume all the other regulatory costs and burdens) in order to accommodate

used oil fuel storage.

Currently, fluctuations in seasonal demand make the use

of leased storage an economic necessity.

Similarly, because of transportation

costs, the use of transfer facilities is essential for cost-effective management of

used oil.

Ironically, IEPA expresses its concern that unmarketable used oil fuel

leads to improper management and disposal, yet IEPA’s proposals will drive up

the cost of used oil fuel products, making them less and less marketable.

NORA’s Supplementary Comments

on Used

Oil Regulations by JEPA

May 6, 1999

Page 5

IEPA’s proposal does not exempt burners from permitting requirements.

Although this may have been unintentional on the part of IEPA, NORA is

extremely concerned that any attempt to impose requirements on burners of

specification used oil fuel that are not imposed on virgin oil will completely

undermine the market for used oil fuel.

Simply stated, no burner will willingly

subject itself to costly and burdensome permit requirements and procedures.

Such permits have many adverse side effects, including, for example, more

paperwork, more potential liability exposure, greater insurance costs, and

greater visibility as a burner.

It is far less costly and burdensome to pay the

slightly greater cost of virgin fuel products.

As NORA has previously pointed out, once the burners switch from used

oil fuel to virgin fuel, there will be no recycling system in place to collect and

manage used oil.

Obviously, this directly affects used oil generated by “do-it-

yourself” oil changers.

The collection system now in place to take such oil will

be dismantled, leaving only the sewer system, the backyard or the trash as

DIYers’ disposal options.

With respect to the special waste manifesting requirements, NORA

believes that used oil generators should remain subject to the current tracking

requirements under Part 739.

Registering and properly categorizing tens of

thousands of used oil generators in Illinois is not worth the effort, expense, and

paperwork burden that would be imposed on the generators, collectors and

JEPA.

NORA is also concerned that many used oil generators would illegally

dispose

of their used oil rather than become a registered generator subject to

JEPA inspections and enforcement actions.

At the very least, the regulatory

burdens thatwould result from this proposal should be carefully evaluated prior

to promulgation.

Finally, we note that the Department of Commerce and Community

Affairs has declined to conduct an economic impact statement on this proposed

rule.

NORA is unaware of any other study or review that IEPA has conducted

regarding the economic impact on the regulated community resulting from the

implementation of these proposed regulations.

Moreover, to the best of our

knowledge, there has been no survey of oil processors in Illinois to determine

whether any of IEPA’s proposals would be workable.

The absence of any of

these inquiries, in combination with the lack of any actual examples of problems

requiringregulatory controls, suggests that IEPA’s proposals are, at best,

premature and, accordingly, should not be adopted.

NORA’s Supplementary Comments on Used Oil Regulations by IEPA

May 6, 1999

Page

NORA also requests that the Pollution Control Board convene a hearing to

consider the many comments received by the Board in April and May.

Prior

hearings did not have the benefit of a comprehensive discussion of the numerous

problems IEPA’s proposal raised in these comments.

NORA would welcome the

opportunity to testify at such a hearing.

Sincerely,

Christopher Harris