D.C. Court rejects EPA's reconsideration request

The D.C. Circuit Court of Appeals recently rejected an appeal by the U.S. Environmental Protection Agency (EPA) to reconsider a previous decision that vacated changes to the new source review (NSR) program.

The EPA appeal was considered a long shot.

In March, a three-judge panel struck down rules aimed at rationalizing the applicability of NSR requirements to routine repairs and equipment replacements at industrial facilities.

The industry has long had concerns with the way the NSR program discourages operators to make facility upgrades, which, in many cases, could improve process energy efficiency and reduce emissions of various pollutants.

The vacated rule would have allowed facilities to repair or replace equipment that did not exceed more than 20% of the value of the entire manufacturing facility without having to first obtain an NSR permit.

In the March decision, the court held that the rule exceeded the EPA's statutory authority, as NSR is intended to apply to "any physical change in operations" that has the potential to increase emissions beyond a de minimis level (i.e. of insufficient significance to warrant judicial attention).

The EPA is contemplating alternative regulatory approaches to resolve the matter.