EPA Proposes Streamlining Process for New Emission Sources

On July 1, the U.S. Environmental Protection Agency (EPA) proposed a new rule that would streamline New Source Review (NSR) permitting processes for minor sources of potential air pollution at factories and other industrial sites like data centers. The new rule would eliminate the minimum federal regulatory requirements for public participation, passing decisions about public participation to state and local governments. The proposed rule aims to reduce administrative burden and speed Clean Air Act (CAA) permitting for smaller industrial projects. EPA will hold a 45-day public comment period following publication in the Federal Register. 

The NSR was established by the 1977 amendments to the CAA to ensure that industrial growth does not compromise air quality. It applies to new major stationary sources and existing major sources undergoing significant modifications that could increase emissions of regulated pollutants. The proposed rule would apply to minor sources regulated under the NSR, including sources that emit pollutants at levels not expected to significantly affect air quality in the surrounding area. These sources typically include additions to existing industrial facilities or new smaller facilities. These types of projects currently require a period of public comment through EPA. 

If finalized, this rule would put state and local agencies in control of whether to provide opportunities for public participation for these projects. It does not alter any emissions standards or laws. EPA permitting partners would still be required to meet all statutory and regulatory human health and environmental requirements, including National Ambient Air Quality Standards.

What the rule could mean for businesses

Manufacturers, energy facilities, data centers, chemical plants, food processing facilities, and other industrial operations frequently rely on minor NSR permits. If passed, this new rule could speed up project approvals, lower permitting costs, and provide more flexibility for project expansions. Companies could spend less time and money on preparing permit notices, supporting public comment processes, and responding to comments. 

However, EPA notes that reducing public participation during minor NSR permitting could lead to more challenges later through the Title V operating permit process for applicable facilities and some permitting disputes may shift rather than disappear. Also, the agency does not expect all states to respond the same way, and some may maintain existing public participation requirements, while others may streamline them significantly. Companies operating nationally could face a more fragmented permitting landscape. The ultimate effect of this proposed rule will depend on how aggressively individual states revise their minor NSR programs and whether increased scrutiny later in the Title V process offsets some of those gains.