A policy memorandum issued by the U.S. Environmental Protection Agency (“EPA”) during December 2017 clarifies how the agency will apply and enforce certain facets of the New Source Review regulations following a pair of recent U.S. Court of Appeals opinions. The policies announced in New Source Review Preconstruction Permitting Requirements: Use of the Actual-to-Projected-Actual Applicability Test in Determining Major Modification Applicability, allow existing facilities with major air permits the opportunity to increase efficiencies and improve operations without triggering the lengthy permit process and implementing additional pollution control technology.

This Jones Day White Paper reviews key points from the EPA’s memo and addresses some of the policy implications for the electric power industry moving forward.