By Robynn Andracsek, P.E., Burns & McDonnell and Contributing Editor
New Source Review (NSR) is too complicated. It inhibits technical and economic development and innovation. The program is a patchwork of regulation, interpretation memos and court opinions. The goal of reform efforts was to clarify and streamline this well-intentioned but ill-written regulation. However, the Environmental Protection Agency’s attempt at a huge reform of NSR has died. Table 1 summarizes the reforms, initiated under the Bush administration.
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Several good ideas from NSR reform died in the courts. Two of these had a common goal of making it easier for units to increase efficiency and add control devices. Pollution control projects are a good thing, but sometimes there is an increase in one pollutant when controlling another. For example, carbon monoxide and sulfuric acid mist can increase in NOX reduction projects like over-fire air and selective catalytic reduction. The net effect of these projects is an improvement in air quality; however, NSR currently discourages investments in certain pollution control and prevention projects, even if they reduce overall emissions.
Likewise, the Clean Unit (CU) test would have encouraged installing state-of-the-art air pollution controls by giving plants that install “clean units” operational flexibility if they continue to operate within permitted limits. Alas, the United States Court of Appeals for the District of Columbia Circuit vacated the pollution control project and clean unit reforms.
The most important and confusing aspect of NSR is identifying which determining modifications trigger NSR permitting. The Routine Equipment Replacement Rule would have defined this critical aspect of NSP applicability. In the process, necessary repair and replacement projects would have been undertaken with certainty as to each project’s permitting needs. The lack of definition of “routine” has deterred owners from making repairs and encourages them to operate failing equipment. Again, the Court vacated this reform, leaving the industry with the Wisconsin Electric Power Co. (WEPCO) court decision as guidance on “routine” (nature, purpose, frequency, extent and cost).
The EPA has indicated that several NSR reforms from the previous administration are “under review,” including:
- Grandfathering PM2.5 emission in permits submitted before July 15, 2008, and allowing states to not consider condensable PM2.5 emissions during a transition period. This reform is needed since test methods for measuring condensable PM2.5 emissions are still evolving.
- Reasonable possibility record keeping and reporting for documenting projects that do not trigger NSR permitting. When this reform was proposed, the most vocal opponent was the commissioner of New Jersey’s Department of Environmental Protection, who is now the EPA administrator. You can pretty much write this reform off.
- Flexible air permits to allow major sources to plan for several operational scenarios and switch between them without additional permitting.
- Whether or not ethanol plants have a Prevention of Significant Deterioration (PSD) major source threshold of 100 tons per year (tpy) or 250 tpy (listed or non-listed).
- An aggregation rule for determining when emissions from plant modifications should be combined into a single project for NSR applicability purposes.
- When to include fugitive emissions in determining whether a physical or operational change results in a major modification for listed and non-listed sources.
Some reforms have been proposed but will be abandoned. One such rule would have explained when a modification in one part of a facility “debottlenecks” another part of the process and therefore triggers NSR. Another would have simplified “netting” calculations, where emissions increases and decreases are added together for determining NSR applicability.
Three changes have been adopted by EPA and are not (yet) identified as being at risk of an early death. The “actual-to-projected-future-actual” applicability test allows a more reasonable prediction of future operation instead of using 8,760 hours per year at full load. The actual emissions baseline reform allows facilities to look for a “more representative” baseline period when considering past actual emissions. Any consecutive 24-month period in the previous five or 10 years (for power plants and other industries, respectively) can be used instead of the most recent 24 operating months.
Finally, plantwide applicability limits (PALs) provide facilities with strict site-wide emissions caps while allowing minor changes under the PAL without additional permitting. However, some state regulators consider PALs to no longer be realistic under today’s permitting scrutiny.
EPA said its motivation for reforming the NSR program was to encourage projects that would “maintain or improve reliability, efficiency or safety of existing power plants and refineries. Reforms to NSR [would] remove barriers to pollution prevention projects, energy efficiency improvements, and investments in new technologies and modernization of facilities.” NSR is fraught with complex and time-consuming permitting processes that lead to regulation through litigation. The need for NSR reform still exists.