September 1, 2003
Volume 81, Number 35
CENEAR 81 35 p. 7
ISSN 0009-2347


AIR POLLUTION

CLEAN AIR REVAMP
Industry applauds, states sue over revised EPA regulation

JEFF JOHNSON

Last week, EPA issued a new Clean Air Act regulation that will affect some 17,000 old U.S. power plants, refineries, factories, and chemical plants.

By modifying the act’s new source review (NSR) provisions, the rule will make it easier for firms to replace equipment without installing modern pollution controls.
NSR requires facilities built before 1970 to install modern air pollution controls when making equipment changes that increase pollution. But it provides an exemption for “routine maintenance” without an emissions increase. The new regulation expands the routine maintenance exemption.

Industries have criticized NSR’s complexity as well as how EPA calculates emissions and applies the routine maintenance exemption.

On New Year’s Eve last year, EPA announced a new emissions calculation method, giving companies more flexibility; last week’s announcement changed the routine maintenance exemption.

Maintenance will now be considered routine if replacement parts are “functionally equivalent” to existing components and costs do not exceed 20% of the replacement value of the entire unit.

Old coal-fired power plants will benefit most from the change. Many of these plants operate without modern pollution controls, generating much of the U.S.’s electricity and air pollution.

Some 50 of these facilities face federal and state lawsuits for NSR violations, and it is unclear how the new regulation will affect them. But new NSR enforcement actions will now be impossible to trigger, say states and environmental groups that oppose this and other Bush NSR changes (see page 24).

Within hours of EPA’s announcement, New York, Connecticut, Massachusetts, and California said they will sue, as did several environmental groups, who challenge the regulation and the process EPA used to develop it. They point to a General Accounting Office report that says EPA relied on anecdotal information from affected industries rather than cost-benefit analysis.

On the other hand, groups representing all types of industries praised the change, including the American Chemistry Council.

“We think this is a very narrow reform,” ACC Air Team Counsel Ronald A. Shipley says. The 20% cap together with the “functionally equivalent” provisions, he says, will block companies from misusing the rule by taking five years to replace the whole plant without modernizing pollution controls, as states and environmental groups have predicted will happen.

Although the change is beneficial to chemical companies, he says, not many have been held up by NSR. “Most companies weigh the costs and benefits and decide to go through the NSR hassles.”

For chemical companies, the new regulation is a “small and narrow change,” but he adds, “Remember, small changes can mean a lot. When gasoline goes up 5 cents, it isn’t much, but across the country on an annual basis it is worth billions of dollars. Across the board, this regulation will mean a lot.”



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