Spring 2003-03 Proposed NSR rule for routine maintenance

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Number 51
Spring 2003

Proposed NSR rule for routine maintenance

Recent changes to the New Source Review ("NSR") program announced by the U.S. Environmental Protection Agency include the proposed promulgation of an improved regulatory definition of the "routine maintenance, repair and replacement" exclusion.

Since 1980, EPA regulations have excluded from NSR all repair and maintenance activities that are considered "routine" in nature. The flexibility afforded by an improved definition of the above term would be welcome by those facilities which currently must go through an extremely complex and time-consuming process to determine whether a particular activity falls within the "routine" exclusion. The proposal would automatically designate two categories of activities as falling within the routine maintenance, repair and replacement exclusion:

Annual Maintenance, Repair and Replacement Allowance ("Safe Harbor"): Activities which promote the safe, reliable and efficient operation of a plant, and whose costs fall within the allowance (on an industry-specific basis), would constitute routine maintenance, repair and replacement.

Equipment Replacement Provision ("Like-Kind Replacement"): Projects involving the replacement of existing equipment with functionally equivalent new equipment would constitute routine maintenance, repair and replacement as long as the cost of the replaced component is below a specified threshold (in the relevant industrial category). The threshold is meant to separate truly "routine" replacement of equipment from major renovations or rehabilitations still subject to NSR.

Note that the above options are voluntary so that a source may elect to use the traditional case-by-case approach to determine the applicability of NSR to a particular project. EPA will receive comments on the proposed rule from interested parties until May 2, 2003. The proposed rule simplifying the routine maintenance and repair exclusion is expected to be finalized in late 2003. n

© 2003 Goldman Antonetti