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News Brief: EPA Proposes Long-Awaited Reform of New Source Review Requirements

Fall 1996

After years of meetings with state agencies, industry, and environmental groups, EPA proposed the much-awaited New Source Review ("NSR") Reform Package. The NSR Program is a wide-ranging air pollution control program under the Clean Air Act that requires new and modified sources of air emissions to obtain preconstruction permits and install state-of-the-art controls. New and modified sources in nonattainment areas must also obtain emission offset credits.

The proposed revisions are expected to dramatically increase operational flexibility for air emission sources and reduce the number of permits currently issued by more than half. The EPA proposal will reduce the number of sources subject to NSR by:

- Applying a new methodolgy based on actual emissions in determining whether a modification triggers NSR (under the current rules, a facility’s worst-case potential emissions are used in applicability determinations);
- Creating exemptions for already well-controlled facilities and pollution prevention projects; and
- Allowing facilities to set plantwide emission caps, whereby changes can be made without triggering NSR as long as the cap is not exceeded.

The EPA is also proposing to streamline existing NSR requirements. Key streamlining features include:

- Simplifying the methodology for determining Best Available Control Technology ("BACT");
- Taking public comment on whether to allow a broader range of preconstruction activities prior to issuance of a permit; and
- Lifting the current restrictions on use of emission reductions that result from shutdowns in nonattainment areas that lack approved demonstrations of attainment.

The aim of the reform initiative is to provide industry with greater flexibility, reduce time delays in issuing permits, and create incentives for innovative technologies. Comments were taken on the proposal through October 21, 1996. The EPA proposal deserves industry support.

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