Policy Documents

New Source Review: Report To The President

Environmental Protection Agency –
June 1, 2002

The New Source Review program (NSR), program is one of many programs created by the Clean Air Act to reduce emissions of air pollutants -– particularly “criteria pollutants” that are emitted from a wide variety of sources and have an adverse impact on human health and the environment.  Many argue that the NSR is ineffective. 

This report frinds that:

  • the NSR program has not significantly impeded investment in new power plants or refineries. For the utility industry, this is evidenced by significant recent and future planned investment in new power plants. Lack of construction of new greenfield refineries is generally attributed to economic reasons and environmental restrictions unrelated to NSR. 
  • As applied to existing power plants and refineries, the NSR program has impeded or resulted in the cancellation of projects which would maintain and improve reliability, efficiency and safety of existing energy capacity. Such discouragement results in lost capacity, as well as lost opportunities to improve energy efficiency and reduce air pollution. 
  • NSR, as applied to existing plants, discourages projects that would have provided needed capacity or efficiency improvements and would not have increased air pollution – in fact in some cases air pollution may have decreased. EPA believes this can result in lost capacity or foregone opportunities to increase capacity without increasing emissions. 
  • With regard to environmental protection, preventing emissions of pollutants covered by NSR does result in significant environmental and public health benefits. Specifically quantifying the NSR program’s contribution to these benefits is very difficult because of the variety of Clean Air Act programs that address these pollutants and because there is no tracking by any government agency of the reductions in emissions that sources make due to the program. Moreover, EPA recognizes that the Agency does not currently have other information that would be necessary to quantify risk reduction benefits associated with the program. However, EPA believes that the inability to make exact estimates does not mean that the benefits of the NSR program are insignificant. EPA also believes, however, that for particular industry sectors the benefits currently attributed to NSR could be achieved much more efficiently and at much lower cost through the implementation of a multi- pollutant national cap and trade program. In particular the President’s Clear Skies initiative is a much more certain and effective way of achieving emissions reductions from the power generation sector.