Federal NSR Reform Effort

In 1996, the EPA issued its NSR rule-making package. Its key features are summarized below:

• New criteria for evaluating the effect of operational changes on actual emissions. The rule allows states to determine whether or not NSR applies to modifications at existing facilities based on more realistic projections of actual emissions changes.

• Greater flexibility to facilities that are already well-controlled. For example, simplified and less restrictive applicability tests are allowed for modifications at facilities that have already installed state-of-the-art control technology.

• Pollution prevention exclusion. Projects that reduce or prevent pollution can be excluded from NSR, significantly reducing the administrative burden on facilities.

• Greater flexibility to set an emissions limit or cap, known as plant-wide applicability limits. Any changes or modifications can be made without triggering NSR as long as the emissions cap is not exceeded. This provision affords participating facilities much greater flexibility in meeting their changing operating and production demands.

• Exemption for certain pollution control projects that substitute less environmentally harmful compounds for stratospheric ozone-depleting substances.

• Reduction in administrative burden for affected facilities in determining the required control technology, BACT or LAER, under NSR.

• Greater flexibility to states in determining control technology requirements, while ensuring that the most effective control technologies are considered.

• Improvement in the process, consistent with the Act, for environmental protection of important natural areas, such as national parks and certain wilderness areas (the so-called "Class I" areas).

• Allowance of a broader range of preliminary construction activities at existing facilities to proceed before the issuance of a NSR permit.

• Lifting of certain restrictions on the use of emissions reductions that result from shutdown facilities as NSR offsets in nonattainment areas that lack EPA-approved attainment demonstrations.

In particular, industry is provided opportunities to exclude from NSR projects that are very low in emissions or are intended to cut emissions. New flexible plant-wide limits are allowed and special consideration is given when an undemonstrated technology is being required.

While the EPA has embarked on a formal process to reform federal major source NSR, several states are making efforts to simplify their pre-construction review processes. Specific reforms being pursued in several states include:

• Providing training and technical assistance, particularly to small businesses.

• Extending the number and types of exclusions from review.

• Creating standardized permits for small and common types of sources that can be issued without extensive permit applications and reviews.

• Trying to integrate pre-construction and operating permit reviews into a single process.

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