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1 (January 14, 2004)

handle is hein.crs/crsmthabcba0001 and id is 1 raw text is: Order Code RS21608 Updated January 14, 2004 Clean Air and New Source Review: Defining Routine Maintenance Larry Parker Specialist in Energy Policy Resources, Science, and Industry Division Summary The Environmental Protection Agency (EPA) final rule on clarifying the definition of routine maintenance under its New Source Review (NSR) process exempts industrial facilities from undergoing NSR if they are replacing safety, reliability, and efficiency rated components with new, functionally equivalent equipment and if the cost of the replacement components is under 20 percent of the replacement value of the process unit. Essentially, the rule permits owners of existing units to maintain and operate their units at their original design specifications without having to undergo NSR, a process that could require a source to meet potentially expensive pollution control requirements. The rule is controversial and being litigated. In December 2003, a three-judge panel of the D.C. Circuit Court of Appeals blocked implementation of the rule until it can make a final determination about the case. This paper will be updated as events warrant. The controversy over New Source Review (NSR) with respect to power generation focuses on existing facilities and the conditions under which facility modifications trigger NSR requirements to install pollution control equipment. Retrofitting and operating equipment designed to meet NSR requirements for existing facilities can be expensive, and utilities have opposed recent efforts by the Environmental Protection Agency (EPA) to enforce NSR on existing powerplants. In particular, utilities have argued that modifications to their facilities reflect current maintenance practices, and, therefore, are not modifications under the meaning of the Clean Air Act (CAA). On August 27, 2003, the EPA issued a final rule' on clarifying the definition of routine maintenance under NSR. Focused on existing sources, the final rule exempts industrial facilities from undergoing NSR for replacing safety, reliability, and efficiency rated components with new, functionally equivalent equipment if the cost of the 1 Environmental Protection Agency, Prevention of Significant Deterioration (PSD) and Non- attainment New Source Review (NSR): Equipment Replacement Provision of the Routine Maintenance, Repair and Replacement Exclusion, Final Rule, p. 37 Available at: [http://www.epa.gov/nsr/ERP-merged_8-27bh.pdfl. Congressional Research Service + The Library of Congress CRS Report for Congress Received through the CRS Web