No doubt some power plant engineers feel that tackling environmental problems is a lot like dealing with the Hydra, the ancient mythological serpent monster with multiple heads. When an attacker would cut off one of the Hydra’s numerous heads, two new ones would grow back in place of the head that was removed. All too often engineers and technical staff at power plants struggle to overcome one environmental regulatory challenge only to turn around and find a whole new batch of environmental rules have sprung up that they have to deal with immediately or risk significant enforcement consequences.
Utilities currently are being hit by the double whammy of trying to comply with stricter environmental standards and dealing with the uncertainties pertaining to the potential for future carbon constraint regulation that might drastically impact their operations. Environmental decisions made today will have long-term implications for the future value of utilities’ assets.
Reflecting the growing impact that the Clean Air Act and other environmental mandates are having on the electric utility sector, this year ELECTRIC POWER offered two simultaneous tracks on environmental regulatory issues, compliance strategies, and new and near-commercial technologies. What follows are just a few examples of the wide-ranging presentations given by the speakers in these sessions.
Running the NSR permit gauntlet
In general, the New Source Review (NSR)/Prevention of Significant Deterioration (PSD) process under the Clean Air Act mandates that any major source (such as a coal-fired power plant), or major modification to an existing source that exceeds certain specified emission thresholds defined in the regulations, obtain permits and undertake other obligations prior to construction. The NSR rule allows exceptions for routine maintenance, repair, and replacement (RMRR) and increases in hours of operation or production rate.
Speaker Eric Hiser, an attorney with Jorden, Bischoff & Hiser, PC, highlighted several recent cases (New York v. EPA, United States v. Cinergy Corp., and Environmental Defense v. Duke Energy) that have dealt with the issue of what types of increases in emissions by utilities constitute a “modification” that triggers an NSR/PSD review. In the wake of these recent judicial decisions, reliance on traditional exemption-based strategies is perilous if there is a greater than de minimis increase in actual emissions, Hiser commented.
“The impact of these recent cases can be modified by strategic permitting and operation. Plant engineers need to permit broadly for a range of fuels and operating conditions. They also need to embrace alternate operating scenarios in Title V operating permits. Additionally, they need to stagger operations to maintain capacity flexibility,” Hiser said.
According to Hiser, the recent judicial decisions place a premium on contemporaneous documentation. He advised plant engineers to document what the company’s view of RMRR is and put the utility’s position “on the record” where appropriate, such as during permit proceedings. He also recommended documenting projects either generically (for routine operational changes) or on a case-by-case basis (for other changes).
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