EPA Takes Action on New Source Review Issues

May 8, 2010
Client Alert Newsletter May 2010

In a series of recent actions, the U.S. Environmental Protection Agency ("EPA") has advanced its efforts to reconsider certain aspects of new source review ("NSR") rulemakings generated at the end of the Bush administration. First, on March 31, 2010, EPA issued an 18-month stay of the Fugitive Emissions Rule, which would require the inclusion of fugitive emissions in calculating modification project emission increases only for specific source categories identified in the federal regulations. EPA has indicated that it will propose, take comment on, and finalize a new rulemaking which would likely revert to EPA's prior policy of including fugitive emissions in calculating emission increases for all sources. Second, in a proposed rulemaking issued on April 15, 2010, EPA indicated its intent to revoke the NSR Aggregation Rule, which established certain presumptions with respect to the aggregation of emissions from nominally separate projects under NSR. EPA will thereby return to its prior case-by-case approach for the aggregation of emissions from nominally separate projects. Finally, on February 11, 2010, EPA published a proposed rulemaking that would repeal the PM2.5 Grandfathering Provision in states implementing the federal prevention of significant deterioration ("PSD") program, and would end the PM-10 Surrogate Policy in states with EPA-approved state implementation plans. Pursuant to this rulemaking, pending and newly filed PSD applications would be required to quantify PM2.5 emissions, rather than using PM-10 as a surrogate.