Viewpoint on NSR

By Bob Smock, Vice President & Group Publishing Director

The so-called “new source review” environmental issue is likely to come to a head this year. Environmentalists are pushing for a tougher stance. Power plant owners are fighting it. I propose we take a more strategic view and work toward a reasonable compromise, rather than flat-out opposition.

Simply put, new source review means applying federal environmental regulations for new power plants-such as strict sulfur dioxide emission limits-to old power plants. The 30-year old Clean Air Act (CAA) requires such application when a major modification is made to an old plant. The idea is to prevent plants built prior to enactment of CAA from being permanently grandfathered from modern environmental regulations.

However, power plant owners have been successful in keeping the old plants exempt from new-plant requirements. They’ve accomplished that by avoiding major modifications, defining most of the repairs and replacements that must be done as routine maintenance.

Environmental groups want the Environmental Protection Agency to use any kind of repair to trigger imposition of modern regulations on old plants-or if the law prevents that, then they want Congress to change the law.

I think it’s time we stopped digging in our heels in opposition to this and consider a reasonable compromise for several reasons:

  • It is absurd to not modernize or replace inefficient old plants. The desire to maintain exempt status has severely retarded investment. There is technology available-not being used because of this environmental issue-that will produce tremendous improvements in thermal efficiency, emissions, availability, and operating costs.
  • This is the best way to come to grips with the looming issue of carbon dioxide emissions. Our best strategy is to propose an emission cap the industry can live with, then start replacing old, inefficient technology-particularly at coal-fired plants.
  • A 30-year exemption is enough. It’s time to start reducing emissions from those old plants.

This will raise the cost of electricity, but I think the public is willing to pay these costs. It does us no good to exaggerate the costs as we did in the acid-rain debate 10 years ago. We’re living with those regulations without any major impact. We can live with a reasonably paced imposition of modern emission regulations on old power plants, too.

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