New Source Review Reforms: One Step Forward or Two Steps Back?

• By Angela Neville
• Apr 01, 2002

Some folks think the top administrators at U.S. Environmental Protection (EPA) are doing some fancy footwork in their attempts to revise the provisions of the new source review (NSR) under the Clean Air Act.

Under NSR rules, stationary source like industrial plants must install state-of-the-art pollution control equipment when they make major plant modifications that increase air emissions. The rules exempt routine maintenance and repairs from NSR requirements. Since its inception, affected stakeholders have wrangled over the NSR program. Power plants and other types of industries have criticized the program on the basis that it keeps them from expanding capacity or making technological improvements. On the other hand, many environmental groups have praised the NSR program as being one of the most powerful means that EPA has to control air pollution.

In May 2001, President Bush directed EPA to conduct a review of the impact of NSR on energy production, new investment and environmental protection in the electric power and petroleum refining industries. In response to EPA's review, Sen. James Jeffords (I-Vt.) sent a letter to EPA Administrator Christine Todd Whitman on December 14 asking the agency provide to the U.S. Senate Environment and Public Works Committee documents on EPA's examination of the NSR program. Jeffords said that he was making the request because of concerns about "rumored changes" to the program that could undermine its effectiveness.

In addition, Jeffords requested that Whitman provide the committee with documents that analyze the impact on future emissions that would result from the adoption of a list of possible changes to the NSR rules, which include the following:

• Changing the baseline for calculating whether emissions from a source have increased, such as allowing plants to choose years with the most air emissions to establish their baselines;
• Adopting "plant-wide applicability limits," which would trigger NSR requirements only when pollution increases were measured for an entire plant, rather than at each unit of a plant, as occurs under existing regulations; and
• Adopting the "clean-unit exemption," which would allow plants that have recently installed modern pollution control equipment to make further modifications without triggering NSR requirements, as long as they did not increase emissions.

In a further development on January 8, Jeffords and Sen. Patrick Leahy (D-Vt.) announced that they will hold a joint hearing of the environmental panel and the U.S. Senate Judiciary Committee in early 2002 to explore the administration's actions with respect to NSR "to ensure the new or modified sources of pollution do not further damage public health and the environment."

Other adversaries of the proposed NSR reforms include nine Northeastern state attorneys general who announced on January 8 that they intend to sue the federal government if the Bush administration significantly weakens the NSR program. New York Attorney General Eliot Spitzer said that the proposed reforms "undercut the Clean Air Act."

Another critic emerged on February 28 when Eric Schaeffer, director of EPA's Office of Regulatory Enforcement for five years, sent a resignation letter to Whitman in which he criticized what he called White House attempts to undermine clean air policy. Much of Schaeffer's criticism was aimed at the administration's plan to revamp the NSR rules.

"At their heart, these proposals would turn narrow exemptions into larger loopholes that would allow old 'grandfathered" plants to be continually rebuilt and emissions to increase without modern pollution controls," he said in his letter.

On the flip side, Edison Electric Institute (EEI), a utility trade association, is in favor of changing the current NSR standards to what the association views as a a more "common sense" approach to regulating stationary sources. Dan Riedinger, the EEI media rleations representative, told Environmental Protection that "EPA under its post-1998 enforcement procedures has been misuing the NSR program for achieving emissions reductions beyond those required under the law."

At press time, the administration still has not released its long awaited proposed reforms. When asked on March 5 by Environmental Protection about the probable release date, EPA Press Officer David Ryan would only comment that they would be announced "soon" and he declined to elaborate. 

Once EPA finally announces its proposed NSR reforms, it appears likely that the agency's critics will accuse the agency of tap dancing around the issue of what real impact the reforms will have on human health and the environment. No doubt the proposed reforms promise to add more fuel to the debate already surrounding this controversial program.

This article originally appeared in the 04/01/2002 issue of Environmental Protection.