leslie s. ritts, partner hogan & hartson l.l.p. 1 new source review “epa utility enforcement...

1Leslie S. Ritts, PartnerHogan & Hartson L.L.P.

NEW SOURCE REVIEW

“EPA Utility Enforcement Initiative and NSR Reform”

American Public Power Association

Colorado Springs, CO

March 13, 2002Leslie S. Ritts, PartnerHogan & Hartson, L.L.P.(202) [email protected]


TOPICS I WILL COVER

• What is the Utility Enforcement Initiative?

• EPA’s Enforcement Targets

• How EPA has Implemented its Initiative

• A Quick Overview of NSR Basics

• A Quick Overview of Clean Air Act Civil and Criminal Enforcement Tools

• Settlements and Agreements in Principle to Date

• A Quick Overview of NSR Reforms


UTILITY ENFORCEMENT INITIATIVE1997-Present

OBJECTIVE

• “Evaluate NSR/PSD/NSPS compliance and, if appropriate, aggressively pursue significant NOx emissions reductions”

From OECA Outline of Utility Enforcement Initiative (1997)


PURPOSE

• To obtain NOx, SO2, and CO emission reductions from initial 25 targeted coal-fired electric generating facilities faster than would be obtained by EPA’s regulations governing the --

– Acid Rain Program

– NOx SIP Call

– Ozone Transport Section 126 Petitions

– Regional Haze Program


UTILITY ENFORCEMENT TARGETS

The Original Eight Systems

• TVA

• Southern Companies

• American Electric Power

• Cinergy (Public Service Indiana)

• First Energy

• Illinois Power Company

• Southern Indiana Gas & Electric

• Tampa Electric Company


THE SECOND WAVE OF TARGETS INCLUDED

• Duke Power

• Virginia Electric & Power Company

• NJ PSE&G

• 20 or More Other Investor-Owned Utilities

• and Rural Electric Cooperatives and Public Power Companies


ENFORCEMENT ACTIONS IMPLEMENTED BY --

– U.S. EPA Regional Counsel (Regional “Leads”)

– U.S. Department of Justice

– U.S. EPA Headquarters Office of Enforcement - Stationary Source Division (Bruce Buckheit, Director)


TYPICAL STEPS IN CLEAN AIR ACT NSR ENFORCEMENT ACTION

• Section 114 Information Request;

• Inspections;

• Supplementary Section 114 Requests;

• Notice of Violations / Administrative Orders;

• Conference with EPA and DOJ Attorneys;

• Settlement Negotiations (Settlements Then Lodged with A Complaint in District Court); or

• Complaint in U.S. District Court;

• Judicially-Supervised Discovery and Trial


HUMAN EFFECTS OF NSR ENFORCEMENT

• Delays in All Permitting

• Uncertainty

– Planned Routine Maintenance During Outages

– Unplanned Maintenance

– Big Projects and Financing

– Reliability and PUCs

• Community Relationships

• Employee and Management Upset


SECTION 114 INFORMATION REQUESTS

Who Are Subject?

• Persons Who Own Emissions Equipment

• Persons Who Manufacture Emissions Control or Process Equipment (e.g., Turbine and Boiler Manufacturers)

• “Any Other Persons” Whom “the Administrator Believes May Have Information (e.g., Trade Associations)”

• Anyone Else Subject to the Act (e.g., Turn-Key Operators)


INSPECTIONS

The Rules

• Broad Legal Authority and Few Limitations

• Little or No Prior Agency Notification Required

• No Warrants

• Establishing System Procedures

– Responsible Manager (Alternate)

– Tours, Samples, Document Requests


EXAMPLES OF EPA § 114 INFORMATION REQUESTS

• “For 20-year period (1978-1998), provide for each unit for each year work order records (capital improvement requests) for all capital projects including but not limited to:

– Work order approvals with authorizing signatures

– Work order project completion reports

– Equipment specifications

– Cost/benefits analyses

– Alternative options analyses.”


EXAMPLES OF EPA § 114 REQUESTS

• “For 20-year period (1978-1998), provide for each unit:– Boiler cross-sectional diagrams

• Original• Current

– Boiler design ratings (original/current)• Steam flow rate

– Peak– Sustained

• Maximum heat input capacity (based on what coal content)

• Gross MW capacity• Net MW capacity



• “For 20-year period (1978-1998) provide for each unit for each year:– Capacity factor– Operating hours– Coal consumption (ton/year)– Total gross and net generation (MW-hr)– Heat rate (BTU/KW-hr)– Annual forced outage rate (principal causes) (MW-hr lost

generation)– Annual planned outage rate

cont’d next page



– Derating/lost generation (MW-hr) due to:• Boiler related components• Turbine generator components• Environmental control performance• Other

– Scheduled/planned retirement dates– Coal analysis (% sulfur, % ash, heat content)– Capability test results (MW)– Monthly peak hourly average generation (MW)”

cont’d next page



• GADs (generating availability data system) reports (1978-present) listing all:– Forced outages– Scheduled outages– Causes– Duration of outages



• “For past 20-year period provide for each year:– Utility system generation– Utility system electric consumption– Utility system electric demand– Net electric sales– Net electric purchases

• Life extension / life optimization studies, evaluations, assessments, reports

• Total capital expenditures per unit for boilers over life of the unit

cont’d next page



• Flue gas recirculation (FGR) changes/dates• Dates of low-NOx burner (LNB) retrofits• Balanced draft conversion dates• Dates of scrubber retrofits• Dates of ESP or baghouse retrofits• Pulverizer and cyclone replacement dates• Economizer, reheater and superheater replacement dates


WHAT IS EPALOOKING FOR?

An Overview of New Source Review Basics


WHAT IS MAJOR SOURCE “NEW SOURCE REVIEW (NSR)”?

• NSR is a preconstruction permitting program that regulates “major source construction” and “the modification” of “major stationary sources” of air pollution (includes criteria pollutants and others).

• It applies to any new major source or any existing major source, that “significantly increase” emissions because of a “physical or operational change” to the source.

• It also applies to minor sources that install major emissions units.


“NSR” vs. “PSD”

• NSR requirements vary depending on the attainment status of the area.

– “Prevention of Significant Deterioration (PSD)” in attainment areas

– “Nonattainment NSR” in nonattainment areas

• Sources in the Ozone Transport Region (New England States) must comply with Nonattainment NSR requirements regardless of the area’s attainment status.


REGULATED POLLUTANTS

• PSD and Nonattainment NSR are pollutant-specific. If an area is nonattainment for one pollutant and attainment for another, two different permits are required (or one meeting the requirements of both programs).

• Nonattainment NSR applies to only the six criteria pollutants (i.e., NOx, SO2, CO, O3, PM, Pb).

• PSD applies to the criteria pollutants and to all other “regulated pollutants,” except Section 112 toxic pollutants (e.g., ODS, H2S, TRS, etc.)


NSR IMPLEMENTATION

• Most PSD/NSR programs are approved into States’ Implementation Plans (SIPs) based on criteria established by EPA (40 CFR 51.165-166).

• There is a Federal PSD program (40 CFR 52.21) for attainment areas; there is no Federal nonattainment NSR program. If a state’s PSD rules are not approved, EPA delegates implementation of the Federal PSD program to those affected States.

• In certain limited instances, EPA also has authority to administer the NSR program.


NSR IMPLEMENTATION, cont’d

• There are approximately 200-250 major source permits issued per year (compared to 20-50,000 minor source permits).

• EPA’s position is that 80% of industry is not in noncompliance with NSR/PSD (from OECA’s 1999 Enforcement Alert).


PSD REQUIREMENTS (Section 165 of CAA)

• Conduct ambient air impact analysis to assure that new emissions will not cause NAAQS or increment violation.

– Preconstruction monitoring

– Pollutant dispersion modeling

• Assure that there are no unacceptable impacts on Class I areas (e.g., National Parks).

• Apply “Best Available Control Technology (BACT)” - The BACT determination process allows for consideration of environmental, energy, economic and other impacts.


NONATTAINMENT NSR (Section 173 of CAA)

• Offset Emission Increase.

• Apply Lowest Achievable Emission Rate (LAER) - The LAER Determination Process Does Not Allow for Consideration of Economic Impacts.

• Ensure State-Wide Compliance of All Owner’s Sources.

• Analyze Alternative Sites and Processes.


NA NSR OFFSET REQUIREMENTS

• Must obtain at least 1-to-1 offsets. Higher ratios apply depending on severity of nonattainment problem.

• Must come from nearby nonattainment area that is of equal or higher classification and that contributes to the area’s nonattainment problem.

• Must be in effect and “federally enforceable” under the Act.

• Must not be used to meet any other requirement under the Act.


WHAT IS A “MAJOR (STATIONARY) SOURCE”

• Any buildings, structures, facilities or installations that (1) belong to the same industrial grouping (2-digit SIC code), (2) are located on contiguous or adjacent property, (3) are under common control (i.e., same owner), and (4) emit above the applicable emissions threshold.

• Includes support facilities even if the support facility is in a different SIC code. A support facility conveys, stores, or otherwise assists in the production processes of the source (e.g., a coal prep plant).

• Factors considered include proximity, dependency, and common control.


MAJOR SOURCE THRESHOLDS

• Prevention of Significant Deterioration (PSD)

– 100 tpy if on the NSPS source category list

– 250 tpy if unlisted source category

• Nonattainment NSR

– 50 tpy for most areas

– Lower thresholds apply in some areas with more severe nonattainment problems (e.g., severe ozone nonattainment has a 25 ton major source threshold).


POTENTIAL-TO-EMIT (PTE)

• The maximum capacity (based on 8760 hours of operation) of a source to emit a pollutant based on its current physical and operational design, allowing for reductions due to practically (or federally) enforceable limitations.

• Practically enforceable means the source must be able to show continual compliance with the limitation or requirement. (Annual emission limitations, e.g., 100 tpy, are not allowed.)


POTENTIAL-TO-EMIT (PTE), cont’d

• “Federally enforceable” means conditions that are enforceable by EPA. The D.C. Circuit Court of Appeals has voided this part of the PTE definition, but it remains in most state programs.


MODIFICATIONS - “THE EMISSIONS INCREASE” TEST

• NSR applies when the post-change emissions could exceed the current actual emissions by a “significant” amount. (Significant is defined for each pollutant.)

• The current actual emissions are based on the source’s operations during the two-year period preceding the change (or a more representative period, if appropriate).

• Post-change utility emissions are based on the unit’s maximum PTE before 1992, and “future actuals” after 1992 in delegated programs or if state has revised its NSR rules.


MODIFICATIONS - ACTUAL TO POTENTIAL TEST

• After 1992, in certain states, predicted future actual emissions are substituted for “PTE’s” under the WEPCO Rule (40 CFR § 52.21(b)(33); 57 Fed. Reg. 32314, July 21, 1992).

– Many states did not adopt WEPCO Rule

– Confusion and ambiguity in applying WEPCO Rule

– Post-change record-keeping?


EXEMPT ACTIVITIES

• “Routine maintenance, repair, and replacement”• Use of an alternative fuel under certain circumstances• Increase in hours of operation or production rate except as

prohibited by a federally enforceable emission limit• Change in ownership• Certain alternative fuels• Addition of a “pollution control project”• Installation or operation of a clean-coal technology• “Reactivation” of very clean coal-fired electric generating

unit.


“RMRR”DETROIT EDISON DETERMINATION, MAY 23, 2000

(Turbine Dense Pack Replacements)

Nature

• Whether major components of a facility are being modified or replaced; specifically whether the units are of considerable size, function or importance to the operation of the facility, considering the type of industry involved

• Whether the change requires pre-approval of a state commission, in the case of utilities

• Whether the source itself has characterized the change as non-routine in any of its own documents



(Turbine Dense Pack Replacements), cont’d

• Whether the change could be performed during full functioning of the facility or while it was in full working order

• Whether the materials, equipment and resources necessary to carry out the planned activity are already on site




Extent

• Whether an emissions unit will be replaced

• Whether the change will take a significant time to perform

• Whether the collection of activities, taken as a whole, constitutes a non-routine effort, notwithstanding that individual elements could be routine

• Whether the change requires addition of parts to existing equipment




Purpose

• Whether the purpose of the effort is to extend the useful life of the unit; similarly, whether the source proposes to replace a unit at the end of its useful life

• Whether the modification will keep the unit operating in its present condition, or whether it will allow enhanced operation (e.g., will it permit increased capacity, operating rate, utilization, or fuel adaptability)




Frequency

• Whether the change is performed frequently in a typical unit’s life




Cost

• Whether the change will be costly, both in absolute terms and relative to the cost of replacing the unit

• Whether a significant amount of the cost of the change is included in the source’s capital expenses, or whether the change can be paid for out of the operating budget (i.e., whether the costs are reasonably reflective of the costs originally projected during the source’s or unit’s design phase as necessary to maintain the day-to-day operation of the source


NSR AVOIDANCE STRATEGIES

• Practically enforceable emission restrictions to limit the source’s PTE to below major source levels (synthetic minor) (NSR if relaxed - Section 52.21(r)(4) NSR “circumvention” policy.)

• “Net out” of review

• Establish plantwide applicability limit (PAL).


NETTING OUT OF REVIEW

• If the emission increase from the source could exceed the significance level, the source can avoid NSR if the total of all its creditable increases and decreases in the preceding 5 years (or other applicable contemporaneous period) does not exceed the significance levels.

• Emission decreases must be real, quantifiable, permanent, and practically enforceable (or federally) and they must not have been otherwise required.


NSR PERMITTING PROCESS

• Source Selects BACT or LAER, Models Air Quality in PSD Areas, Obtains Offsets in Nonattainment Areas

• Source Submits Application • Completeness Determination by Permitting Authority (PA)• Within one year, PA must issue a proposed permit for public

review– Make the application, the proposed permit, and all related

materials available to the public for comment;– Notify the public of the proposed permit in a local newspaper

cont’d on next page


NSR PERMITTING PROCESS

• PA must transmit a copy to the FLM, other States, and/or tribes affected

– Make the application, the proposed permit, and all related materials available to the public for comment;

– Notify the public of the proposed permit in a local newspaper.

• After considering all public comments (written and oral) the PA may issue the final construction permit

• The PSD/NSR Permit must be incorporated in the Title V Operating Permit


Modifications to Existing Boilers EPA Alleges Were Not Permitted!


MAJOR COMPONENTSUNDER ENFORCEMENT SCRUTINY

• Superheaters• Economizers• Reheaters• Air heaters• Boiler tubes• Cooling H2O tubes• Burners• Cyclones• Pulverizers• Ash pits• Coal grates• Ash hoppers (fly ash

handling systems

• FG recirculation systems• Air inlet ducts• Turbine apertures (e.g.,

blades or buckets)• Ductwork for gas from

boiler• Duct dampers• Air reheaters• Boiler make-up H2O

systems• Coal handling/coal yard

changes


TARGETED CHANGESAND REPAIRS

Boiler Components

• Water Tubing - Convection, Superheater, Reheater, Economizer

• Fans

• Coal Pulverizers

Turbine Components

• Blades


EPA’S ASSERTIONS --

Violations of Clean Air Act NSR occurs if a non-exemptNSR change results in:

• Recovery of lost utilization or capacity (e.g., “life replacement projects”);

• Greater boiler efficiency and potential increase in utilization;

• Increased peak capacity at the unit (e.g. repowering);

• A unit is restarted after “many?” years.


KEY PROBLEMSFOR THE INDUSTRY

• All old coal-fired units require periodic replacement of tubes

• Material improvements, changes in coal quality, and experience may lead to “changes in design”

• Any repair or replacement will make the unit more reliable and if it is available, one can expect it to be used more. If it is used more, emissions will increase unless capped.


KEY TO THE DEFENSE OFPAST PROJECTS

• Understanding the history and drawing a distinction between the scope and intent of the project and what happened at Wisconsin Electric Power Company, as analyzed by the Seventh Circuit Court of Appeals (WEPCO v. Reilly, 893 F.2d 901 (7th Cir. 1990), relative to “customary and routine maintenance in the industry.”

• Preparing an analysis that the project did not “result in” emissions increases.


KEY TO THE DEFENSE OFCURRENT PROJECTS

• Defining the project and managing its paper trail

• Documenting an analysis that:

– Project is “routine maintenance, repair or replacement (or one of the other NSR exemptions)”

– That the project will not result in an increase in emissions

• Obtaining state and local agency support of determinations, if possible


PARTICULAR SCRUTINY OF --

• Replacement of major components with improved design and materials

• Replacement of major components with same design and materials

• Periodic preventive maintenance

• Repair of components when they fail completely


What Happens When EPA Finds An NSR Violation?

A Review of Clean Air Act Enforcement Tools


BASIC COMPLIANCE TOOLS

• Administrative Penalties (“Traffic Tickets”)

• Administrative Orders

• Civil Actions

– Injunctions to Halt Construction

– Injunctions to Retrofit Equipment

– Civil Penalties or Section 120 Compliance Orders

• Criminal Actions

• Section 303 Imminent Harm Orders


IN THE UTILITY ENFORCEMENT INITIATIVE, THE U.S. DEPARTMENT OF JUSTICE IS SEEKING FROM VARIOUS

UTILITY SYSTEMS:

• Civil Penalties

• Injunctive Relief

• Supplemental Environmental Projects (“SEPs”)

– But No Criminal Penalties


CLEAN AIR ACT CIVIL PENALTIES

• Section 113(b) - $25,000 per day, per violation escalated to $27,500/day/violation

• $10 million/yr for a single violation


CRIMINAL PENALTIES

• Section 113(c) - Any person who “knowingly” violates any requirement or prohibition ... shall upon conviction be punished by a fine pursuant to Title 28 and/or by imprisonment not to exceed 5 years

– Also applies to material statements, representations, certifications, or omits information or fails to file or maintain any notice, application, record, plan or other document ... whether with respect to the requirements imposed by the Administrator or by a state.


UNRESOLVED QUESTIONS REGARDING CRIMINAL LIABILITY

• Public Health Laws Interpret Strict Liability - No “Mens Rea (Intent to Violate)”

• Criminal Clean Air Act Cases - Falsification of Monitoring Data

• Legislative History

– Requires “Notice” of Requirement

– Excuses Penalties for Good Faith Prompt Self-Reporting

– Shifts Burden to Management


DOJ LETTER TO NSR DEFENDANTS

November 15, 1999 Department of Justice Letter

• Shutdowns not necessary

• But no reassurances

• Ask us --


EPA NSR COMPLAINTS ALLEGE --

• Failure to Obtain PSD/NSR Construction Permits and/or State Operating Permits

• Failure to Install “BACT” or “LAER”

• In Nonattainment Areas, Failure to Obtain Offsets

• Failure to Comply with NSPS

• Other Federally-Enforceable State Violations (e.g., SIP Opacity Violations, Start-up/Shutdown/ Malfunction Reporting Violations)


INJUNCTIVE RELIEF

• “BACT” - Today’s “BACT,” not retrofit “BACT”/ “LAER”

• Enhanced Monitoring

• Air Quality Monitoring and Modeling

• Restrictions on Emissions Trading Relinquishment of Banked Emissions Reductions

• SEPs to Mitigate Damages


BACT FOR UTILITIES

• Sulfur Dioxide (SO2) - scrubber or switch to gas

• Particulates - High efficiency electrostatic precipitator / fabric filter bag

• Nitrogen Oxides (NOx) - Selective Catalytic Reduction (SCR)


LEGAL DEFENSES INCLUDE --

• Statute of Limitations (See Next Page)

• EPA’s Interpretations Counter to Legal Reading of CAA

– WEPCO Defenses

– Significant Increase Test

• Fair Notice Defense / Illegal Rulemaking

• Project Exempt from NSR (RMRR, etc.)

• No Actual Emissions Increases

• Emissions Increases not “the result of” the Project

• State Approved Project


LEGAL DEFENSES TO NSR VIOLATIONS

• Statute of Limitations

– No Clean Air Act statute of limitations

– 28 USC § 2462

– 5 years of penalties (EPA v. Marine Shale, 81 F.3d 1329 (5th Cir. 1996)

– No statute of limitations for injunctive relief• Campbell Soup N.D. Cal. 1987

• American Electric Power, So. Dist. Ohio 2001

• But see Mead v. EPA, W.D. Maryland 2001


LEGAL DEFENSES TO NSR VIOLATIONS

Fair Notice Doctrine

• Company had “Notice”

• Company Could Determine the Content of the Notice

– General Electric Case (TSCA)

– Chrysler Case (NHTSA)

– Hoerchst Celanese (Clean Air Act)


ENFORCEMENT ONGOING

TVA May 21, 2002 – HearingScheduled in FederalEleventh Circuit Court ofAppeals on EPAAdministrative Record /Decision Aug.-Oct. 2002

I llinois Power Trial Scheduled J uly 2002,Discovery Ongoing

AEP, So. Indiana Gas& Electric, FirstEnergy, SouthernCompanies

Discovery Ongoing,Trial 2003-2004


DOJ NSR REPORT


“New Source Review: An Analysis of the Consistency of Enforcement Actions with the

Clean Air Act and Implementing Regulations”(Jan. 15, 2002)

“The Department concludes that the EPA has a reasonable basis for arguing that the enforcement actions are consistent with both the Clean Air Act and the Administrative Procedures Act.”

***

“Having concluded that the EPA has a reasonable basis for bringing the enforcement actions, the Department of Justice will continue to prosecute these lawsuits before the federal judiciary.”

John Ashcroft, Attorney General


“New Source Review: An Analysis of the Consistency of Enforcement Actions with the

Clean Air Act and Implementing Regulations”(Jan. 15, 2002), cont’d

“The EPA to date has not issued a regulation that explains which type of construction project it considers ‘routine maintenance,’ and hence exempt from New Source Review.”

***

“Although the New Source Review Program has been in effect since 1977, the EPA did not until recently file enforcement actions alleging that certain facilities’ construction projects constitute ‘modifications.’”

John Ashcroft, Attorney General


WHAT HAS EPAGOTTEN TO DATE?

Utility NSR Settlements and“Agreements in Principle”


UTILITY SETTLEMENTS

1998 Tampa Electric Company signed consent decree valued at $1 billion covering two plants (10 units) for 10 years

2002 New Jersey Public Service Electric &(not yet Gas signed consent decree valued at lodged) $0.35 billion covering three plants (4 units)

Both received past and future NSR protections /“covenants not to sue.”


UTILITY “AGREEMENTS IN PRINCIPLE,” BUT SETTLEMENTS

NOT YET WORKED OUT

• Cinergy – tentatively agreed in 2001 to settlement valued at $1.4 billion covering 10 plants (34 units).

• Virginia Power – tentatively agreed in 2001 to settlement valued at $1.2 billion covering 8 plants (21 units).

• Others Thought to Be Negotiating, Although Status Certainly “Unclear.”


COMPARISON OF EMISSION REDUCTIONS IN SETTLEMENTS AND

AGREEMENTSNOx Controls

• TECO - SCR or equivalent controls, average 0.15 lb/mmBtu across facility, or 3.5 ppm for repowered units (no cap)

• PSE&G - SCR by 2004-2007 scheduled: individual units to achieve 0.1 lb/mmBtu - 0.15 mmBtu (no federal cap)


COMPARISON OF EMISSION REDUCTIONS IN SETTLEMENTS AND

AGREEMENTS, cont’dNOx Controls

• Cinergy - SCR or equivalent controls at nine units equivalent to 0.1 lb/mmBtu beginning in 2004; SNCR or low NOx burners on other units (system-wide cap during ozone season)

• Virginia Power - SCR installations to reduce 55,000 tons by 2004-7 with additional reductions 2008-2012. Systemwide cap of 30,250 Tpy by 1/2013 from 1998 baseline of 105,000


SULFUR DIOXIDE SCRUBBING

• TECO - 93-95% Scrubber efficiency by Sept. 2000 (no cap)

• PSE&G - Installation of scrubbers at 4 units 12/06-12/12 with 0.15 lb/mmBtu average (30 day rolling)

• Cinergy - Scheduled installation of scrubbers over 2008-2013 and optimization other scrubbers

• Virginia Power - Scheduled two 95% control scrubbers by 2002? Two others by 2010, 2012

Some will have caps but no details


PARTICULATE MATTER

• TECO - BACT Analysis/ESP optimization, 1 CEM by 2002

• PSE&G - Baghouse by 12/06 to achieve 0.015 lb/mmBtu at one facility; improve operation at other facility to achieve 0.03 lb/mmBtu

• Cinergy - BACT review and upgrades based on review, assess Hg Technologies

• Virginia Power - Optimization of Controls and CEMs?


OTHER SETTLEMENT TERMS

• Emissions Trading Restrictions, Retirement of Credits

• Civil Penalties $1.4mm (PSE&G) - $3.5mm (TECO) - $8.5mm? (Cinergy)

• SEPs

– TECO - $5mm for NOx mitigation projects, $2mm for state estuary programs

– PSE&G - $6mm for various projects including CO2 reduction

– Cinergy - $21.5mm commitment

– Virginia Power - $14mm commitment


WHAT IS NSR REFORM?


NSR REFORM AND EFFECT ON ENFORCEMENT

• Public Debate on Enforcement

• NSR “90 Day” (265 Day and Counting) Report with NSR Recommendations

• NSR Reforms and Rulemaking


NSR REFORM RULEMAKING

Summer 2002 - Final Rule

• Significant Increase Test with Causation

• 2-of-10-yr. Baseline

• 10-15 yr. “Plantwide Applicability Limits” (PALs)

• 10-15 yr.”Clean Unit Exemption for PSD/NSR sources or 90% state-approved equivalent

• New FLM Procedures


NSR REFORM RULEMAKING, cont’d

Summer 2002 - Proposed Rule

• Routine Maintenance, Repair and Replacement

• (5% of Capital Replacement - per project? Aggregated project over two years? What is baseline?)

• Narrative Description for projects exceeding 5% (nature, purpose, cost, frequency)

• Final Rule??

leslie s. ritts, partner hogan & hartson l.l.p. 1 new source review “epa utility enforcement...

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