On March 13, 2018, U.S. EPA Administrator Scott Pruitt issued a new guidance memo on New Source Review (NSR) pre-construction permitting. The memo outlined “Project Emissions Accounting,” a procedure which allows for project emissions decreases to be accounted for in Step 1 of the NSR applicability process. This project-related emissions reduction consideration has been commonly referred to as “project netting.” 

The NSR regulations specify that determining whether a project at an existing major stationary source triggers the requirements to obtain an NSR permit is a two-step process.  Step 1 is a determination of whether the project, by itself, will result in a significant emissions increase.  Step 2 is an evaluation of whether the project will result in a significant net emissions increase taking into account any other creditable increases and decreases in actual emissions at the source. These Step 2 calculations are commonly referred to as “netting” or “contemporaneous netting.” 

The memo explains that the prior term “project netting” has caused confusion with permitting authorities and within EPA itself and that “project emissions accounting” is a more accurate description of what should take place under Step 1.  Emissions reductions associated with the project previously could not be accounted for until Step 2. Therefore, many companies may determine that their projects do not trigger major NSR permitting under Step 1 by accounting for these project related reductions using “project emissions accounting,” which will speed up the applicability process. Administrator Pruitt also alludes to forthcoming guidance on project aggregation.

Trinity will discuss the implications of this guidance along with EPA's other recent NSR related activities during the upcoming NSR webinar on March 27, 2018.  If you have any questions in the meantime, please call Trinity at 1-800 229-6655.