This report presents the results of a program of analysis and study performed during 1991 on Clean Air Act regulations which impact the natural gas transmission industry. This program is sponsored by the Interstate Natural Gas Association of America Foundation. The objectives of this work program are to enhance understanding and response of the gas transmission industry to air regulatory issues which affect the installation and operation of gas transmission pipeline facilities.
The 1991 program of studies continues work initiated in 1990 on policy options for responding to EPA's "Top Down" policy for determining the best available control technology (BACT) in Prevention of Significant Deterioration (PSD) permits. The 1990 work was presented in the report, "Options for Addressing EPA's Best Available Control Technology Top Down Policy" issued in January 1991.
Since the issuance of the January 1991 report, two events significantly changed the direction of air regulatory analysis and study during the remainder of 1991. The first event was EPA's signature of a settlement agreement in the litigation brought by industry groups challenging the EPA Top Down policy. In this settlement EPA agreed to initiate formal regulatory procedures for establishing PSD BACT determinations. This had been one of the key objectives of the 1991 Report.
The second major event affecting the direction of air regulatory analysis in 1991 was the passage of the Clean Air Act Amendments of 1990. These amendments introduced significant new programs which affect the permitting of compression facilities in the gas transmission industry. The 1990 Amendments represented the first revision to the Clean Air Act since 1977, and occurred at a time when a large number of urban areas were designated non attainment for ozone (96), carbon monoxide (4 I), and particulate matter (73). If the timetable of the new Act were to be met, the Amendments would result in EPA's issuance of 55 major rules and 30 regulatory guidance packages by November 1992, and the issuance of a total of 200 regulations overall. As a combustion fuel, the natural gas transmission industry is broadly effected by the Amendments. A positive effect comes from the potential of increased substitution of natural gas for coal or oil, both of which may be subject to more costly air pollution controls. A negative effect comes from the new imposition of emission controls for NO, and air toxics, and a general increase in the cost and complexity of acquiring air permits for natural gas transmission facilities. A further negative effect comes from the increased uncertainty and cost of permitting which will be experienced by the end users of natural gas.
In view of EPA's agreement to issue a PSD rule for BACT determination and the advent of the Clean Air Act Amendments, the 1991 program of air regulatory analysis and study was directed at the following topics:
- Monitoring EPA's formal rule development process for PSD BACT determination;
- Review and analysis of the Title I and Title 111 provisions of the 1990 CAA Amendments;
- Review and analysis related to comment development for policy and regulatory documents issued by EPA to implement the Amendments.
The following sections of this report present detailed information about the 1991 program of air regulatory analysis and study. The format for these sections is to first describe the current regulatory situation, to then discuss key issues which affect the gas transmission industry, and to conclude with the listing of possible action areas.