10/29/2018 - Legal Analysis

Review of New Source Review Changes in Affordable Clean Energy (ACE) Proposal

by EELP Staff

The Trump administration’s Affordable Clean Energy (ACE) proposal to replace the Clean Power Plan (CPP) includes an amendment to the Clean Air Act (CAA) New Source Review (NSR) program that would significantly curtail the applicability of NSR permitting to power plants. In doing so it would weaken a program that the EPA and states have long relied on to ensure that when new investment is made in an emissions source any emissions increases that may result are minimized.

Harvard Law School’s Environmental & Energy Law Program (EELP) has prepared a Memorandum on EPA’s Proposed Changes to New Source Review in ACE, available for download here.

EPA’s new proposal erects an hourly emissions test between steps 1 and 2 of the current three step process for determining when a project at an Electric Generating Unit (EGU) is a “major modification” (triggering certain permitting and control requirements under current NSR regulations). This additional step would serve as a gatekeeper or off-ramp in the NSR process before moving on to the existing annual emissions test for whether an emissions increase is “significant.” EPA acknowledges that this creates a more lenient NSR regime than current law but argues that alleviating the burden of New Source Review is critical to facilitating sources’ adoption of the “candidate technologies” that states choose to adopt to improve plant heat rates as a result of ACE.

EELP’S memorandum (prepared by lead author Hana Vizcarra, EELP Staff Attorney with assistance from Executive Director Joe Goffman) outlines the primary arguments and justifications for this change to NSR regulations furnished by EPA in its Proposed Rule issued on Aug. 31, 2018. While this document focuses exclusively on the portion of the proposal dedicated to the NSR change, our program has also prepared a summary of the primary arguments in the larger proposal that is available here and an extensive step-by-step lay-out of the legal arguments advanced in the ACE and the CPP repeal proposals available to download here.