The U.S. Environmental Protection Agency (EPA) last week admitted it would not finalize two air pollution rules that would have eased restrictions on coal power plants before the incoming administration takes office on Jan. 20.

The agency did not publish a formal statement, but EPA Press Secretary John Shradar confirmed to POWERnews that it would abandon efforts to revise the New Source Review for Electric Generating Units (PDF), an October 2005 proposal, and its Prevention of Significant Deterioration (PSD) increment-modeling rule.

In general, the New Source Review (NSR) process under the Clean Air Act mandates that any major source (a coal-fired power plant, for example) or major modification to an existing source that exceeds certain specified emission thresholds obtain permits and undertake obligations—such as installing antipollution devices—prior to construction. The NSR rule allows exceptions for routine maintenance, repair, and replacement, and increases in hours of operation or production rate.

The agency employs a two-step test to determine whether the modification is subject to preconstruction permit review: The first step looks at whether there is a physical change or change in the method of operation; the second step evaluates whether an emissions increase exists.

The EPA’s proposed rule would have made uniform emissions tests used under two Clean Air Act programs, NSR and New Source Performance Standards (NSPS), and used them to determine if operational change at a power plant required installation of additional pollution controls. That test would have compared the maximum emissions achievable in an hour—as opposed to the maximum emissions achievable over a year—to those achievable at the unit after the modification.

But last week, the EPA abruptly dropped its plans. Shradar told the Washington Post that though the agency continued to support the proposal, it was “abiding by an administration order against ‘midnight regulations.’ ”

The issue would also have been difficult to resolve before the Obama administration took office, having been complicated by a July 2008 order from a federal appeals court that vacated the Clean Air Interstate Rule—a measure that would have complemented the proposed rule—Shradar told the newspaper.

The EPA also abandoned finalizing new air-quality rules that would have changed the practice of measuring pollution levels and made it easier to build coal-fired power plants near national parks. It had proposed averaging pollution levels at wilderness areas over a year instead of the current process of measuring them in three-hour and 24-hour increments to capture law-violating emission spikes during periods of peak energy demand.

The Washington Post reported in November that even though half of the EPA’s 10 regional administrators had formally dissented to the move and four others had criticized it, the Bush administration was pushing to finalize the rule.

In a related story, the EPA last week issued a final NSR rule that requires consistent accounting for fugitive air emissions, or those not released through a stack, vent, or other confined air stream. A bulk of the emissions governed by this regulation involve those from equipment leaks or evaporation.

The revision requires facilities to account for fugitive emissions from major modifications from existing facilities the same way as they account for fugitive emissions from major newly built facilities under the NSR program. The final rule requires that fugitive emissions be included in determining whether a physical or operational change results in a major modification only for sources in industries that have been designated through rulemaking under section 302(j) of the Clean Air Act.

Sources: EPA, Washington Post