WASHINGTON DC - Last week the Bush administration announced new regulations designed to speed up maintenance and upgrading of electric power plants to make them more energy efficient and expand generation capacity. And there followed the predictable result: all hell broke loose from environmentalists.

At issue is a set of arcane regulations under the Clean Air Act known as “New Source Review” or NSR. Under NSR, any potential “new” source of air pollution, such as a new factory or power plant, has to meet strict emission limits prescribed by the Clean Air Act. But when the first versions of the Clean Air Act were written back in the 1970s, Congress faced a serious dilemma. It would have been prohibitively costly to require all existing factories and power plants to meet the tough new emission standards. Electricity bills would have tripled or quadrupled overnight to meet the new standards, and if that had been done public support for the Clean Air Act would have collapsed.

So existing sources were “grandfathered,” and would be required to meet the new emission standards only when being replaced or upgraded in a significant way. In the abstract this makes a lot of sense. Most factories and power plants will be replaced in the fullness of time anyway, as they reach the end of their designed life-span, so emissions reductions would come in the future as new low-emitting factories and power plants replaced the old ones. In practice, however, this has become a regulatory nightmare.

In the exact opposite of the intention of the Clean Air Act, NSR rules had the perverse effect of keeping old, high polluting power plants online far longer than anyone expected. Because many modifications to existing power plants to make them more energy efficient or to expand generation capacity triggered “new source review” by the EPA, the NSR rules became a disincentive for upgrading power plants, even in cases where upgrades might reduce air pollution or conserve fuel. NSR for power plants has become the subject of contentious litigation, and the whole mess has dragged on for years.

So the Bush administration decided recently to relax the cumbersome and counterproductive NSR requirements on power plants and other industrial facilities, in large part because the President’s “Clean Skies” initiative of February will reduce pollution from power plants by more than 70 percent during the next decade. It will achieve these reductions through a tradable emissions program that many environmentalists have endorsed. In such a program, the NSR regulations are archaic and an impediment to cleaner air.

Indeed, the Progressive Policy Institute, the think-tank arm of the Democratic Leadership Council, called last year for NSR regulations to be abolished under the tradable emissions program Bush has embraced, because “NSR no longer provides any significant emissions reductions, and eliminating these NSR provisions for new sources has the potential to actually boost cleaner energy technologies…”

So when you hear environmentalists kvetching about Bush rolling back the clock, remind them that he is following a Democratic prescription, and offer a wager with environmentalists that pollution from power plants will be lower in five years than they are now. It is the easiest bet you’ll ever win.

Steven Hayward is a senior fellow at the Pacific Research Institute in San Francisco and the author of
The Age of Reagan--The Fall of the Old Liberal Order, 1964-1980. He can be reached via email at
shayward@pacificresearch.org.