NSR program for coal-fired plants creates friction

 

The Bush administration is working to finalize an industry-backed emissions rule for power plants that critics say conflicts with a landmark Supreme Court decision that was handed down earlier this year.

The administration's rule, which is still in the proposal stage, and the Supreme Court decision both pertain to the federal New Source Review program, which requires electricity generators to install new pollution controls when undertaking certain modifications.

Electric utilities strongly support EPA's proposed rule, saying it would allow them to undertake modifications that would reduce their emissions as well as generate more power.

The administration's rule, which the Environmental Protection Agency first unveiled in October 2005, would allow utilities to sidestep NSR if their post-modification emissions did not increase on an "hourly" basis. That's a far less rigorous standard than the "annual" NSR emissions test that Congress established in 1977.

EPA based its proposed hourly emissions test rule, in large part, on a decision that the 4th Circuit Court of Appeals in Richmond, Virginia, issued in 2005 in a case involving Duke Energy. The Supreme Court struck down that ruling in April, agreeing with environmental groups that the appeals court should have used an annual emissions test to judge the legality of Duke's power-plant modifications.

EPA, though, intends to finalize its hourly emissions test NSR rule despite the Supreme Court's decision in the Duke case. "The decision does not affect EPA's plan to proceed with the emissions test rule," EPA press secretary Jennifer Wood told Platts shortly after the Supreme Court decided the Duke case.

EPA is taking public comments on the proposed rule until August 8. The agency could publish a final version anytime after that, which would open a 60-day window for critics to sue EPA over the measure.

Environmental groups have strongly hinted that they would sue EPA if the agency finalizes the rule. John Walke of Natural Resources Defense Council, which was among the groups that challenged Duke's modifications before the Supreme Court, said EPA's draft rule "was illegal before the Supreme Court decision, and it remains illegal after the decision."

Electric utilities strongly support EPA's proposed rule, saying it would allow them to undertake modifications that would reduce their emissions as well as generate more power. But a host of states and environmental groups reject that reasoning, saying the rule would allow utilities to radically increase their emissions.

Created: July 16, 2007

* You may be required to register/log in for access to some of the feature's pages. Registration is free. If you have already registered on platts.com, registration will not be required.