The Environmental Protection Agency yesterday approved a proto-type air pollution control plan for Armco Inc.'s Middletown, Ohio, steel plant that permits the company to clean up dust and airborne dirt from the plant grounds instead of installing expensive filters to trap other pollution escaping from plant buildings.

EPA Acting Administrator Walter C. Barber said that approval of the Armco plan "has opened the door for other steel firms to develop similar cost-savings programs," and the administration will try to speed approval of these plans as part of the Reagan administration's campaign to reduce regulation of business, he added.

The Armco plan has been a key test of the so-called "bubble" approach to pollution control, in which a plant is assumed to be covered by an imaginery bubble or dome with only one emission point for air-borne pollutants. Instead of insisting on special pollution controls for every smoke-stack or other pollution source in a plant, EPA permits the company to choose its own control plan, as long as the total emissions from the plant underneath the "bubble" comply with federal requirements.

An EPA spokesman said that more than 70 companies have proposed "bubble" plans.

The Armco plan is based on a program to control dust throughout the plant grounds by paving roads and perimeter parking lots and spraying water and other dust controllers on coal and ore piles.

The EPA approval permits Armco to take these steps instead of building filter systems and other control devices to catch "fugitive" emissions that otherwise would escape from plant windows, doors and vents. The plan is not a substitute for the controls EPA requires on furnaces and other manufacturing processes, however.

Armco, which is investing $5.6 million in dust control, said it will save at least $14 million to $16 million at its Middletown plant by following its dust control plan. The company also said it will eliminate six times more particles with its plan than would be trapped if EPA insisted on its customary controls of "fugitive" emissions.

An EPA official said the key to approval of the Armco "bubble" was the company's claim that the new plan would lead to an overall reduction in particulate pollution in the Middletown area, bringing it in complaince with EPA's standard for particulates by the end of 1982.