NSR rules must provide certainty

Published September 1, 2002

When Detroit Edison proposed replacing worn turbine blades at two plants with an improved design that would increase efficiency by 4.5 percent, EPA Region V bureaucrats in May 2000 concluded doing so would not constitute “routine” maintenance.

The improved materials in the new blades would have reduced the need for future blade repair and replacement, lowered the chances of forced outages, and promoted safer, more reliable power. But EPA ruled Detroit Edison’s proposal should trigger the laborious and costly New Source Review (NSR) process.

After determining that water-based inks and coatings contained substances that could poison the catalyst in its expensive thermal oxidizer, a flexible-packaging firm asked its state permitting agency if it might be allowed to run the oxidizer only when using solvent-based inks and coatings. The change, said the firm, would save approximately 15,000 cubic feet of natural gas and 650 kWh of electricity each day.

But the state agency advised that EPA would likely view the change in the plant’s “method of operation” as one triggering NSR. As you might guess, the change was never made.

Examples such as these are countless. While state agencies, industry, and even EPA itself have said for years that NSR was in desperate need of reform, improvements in industrial designs, materials, and processes that could increase the efficiency and reliability of facilities have been stymied. Proposed changes that would significantly reduce fuel consumption, air pollutant emissions, and greenhouse gases have all been disallowed or discouraged by EPA confusion.

With manufacturing still struggling to recover from a sector-specific recession that began a full six months before the overall economic downturn, and with congressional lawmakers still dragging their feet on a comprehensive energy policy bill, it’s high time to bring certainty to NSR.

In June EPA submitted to President George W. Bush a report on NSR accompanied by recommendations for reform. Proposed reforms would be administered by EPA under the Clean Air Act and would “remove the obstacles to environmentally beneficial projects, clarify NSR requirements, encourage emissions reductions, promote pollution prevention, provide incentives for energy efficiency improvements, and help assure worker and plant safety.”

All the usual opponents of Bush administration environmental policies have come out against EPA’s NSR recommendations. But it should be noted that five of the eight major reforms had been proposed by the Clinton administration in 1996 and have already undergone formal rulemaking procedures, including public notice and comment. If EPA presses forward, those five reforms could be quickly implemented and move us immediately toward improved environmental quality and energy efficiency.

The remaining three recommended NSR reforms must yet undergo formal rulemaking. It would be a foolish mistake for members of Congress to delay this process any further simply to score political points with interest groups whose agendas are based on misinformation about NSR’s environmental effects.

Air quality has improved dramatically since enactment of the Clean Air Act in 1970. But NSR permitting for existing facilities has not contributed much to that improvement. Instead, NSR’s ambiguity and costly delays have frustrated business planners, while other air quality programs have had wonderfully positive impacts on emission reductions.

The 25-year-old NSR rules inhibit needed repairs and improvements. We must eliminate these regulatory roadblocks and confusing uncertainty if industry is to recover from recession and help us reach our environmental goals.

EPA’s proposed reforms would help promote safer, cleaner, and more efficient power plants, refineries, and factories. Because innovation and investment are the keys to improving air quality and energy supply, the mix of final and proposed NSR rules should move us in the right direction.

Jeffrey Marks is director of air quality at the National Association of Manufacturers.