01 April 2020

EPA Narrows Scope of “Begin Actual Construction” Restriction Under New Source Review Preconstruction Permitting Program

On March 25, EPA issued a draft memorandum outlining its revised regulatory interpretation of when site owners and operators can “begin actual construction” of new major stationary sources or major modifications to existing major sources under the New Source Review (NSR) preconstruction permitting program. Under the NSR program and Prevention of Significant Deterioration of Air Quality rules at 40 C.F.R § 52.21, a site owner cannot “begin actual construction” on these sources without an NSR permit in hand. “Begin actual construction” is defined as “in general, initiation of physical on-site construction activities on an emissions unit which are of a permanent nature. … [including] installation of building supports and foundations, laying underground pipework and construction of permanent storage structures.”

Since inserting the “begin actual construction” language in the NSR rules in 1980, EPA had taken the position that most physical and permanent on-site construction activities could not occur without an NSR permit. EPA’s revised interpretation will allow site owners and operators to undertake physical and permanent on-site construction activities as long as those activities do not constitute physical construction “on an emissions unit.” This interpretation aims to give meaning to the distinction between an “emissions unit” and a “major stationary source” set forth in the regulatory text. Under the interpretation, owners and operators may now engage in a wide range of site preparatory activities, even if those activities are costly and significantly alter the site, including construction of an “installation necessary to accommodate” the emissions unit.

EPA does not expect its revised interpretation to have any emissions consequences or adverse effects to the environment, and any pre-permitting construction is taken at the permit applicant’s own risk. Interested parties may comment on the draft memorandum through EPA’s website until May 11, 2020.