ELR Citation: ELR 20167
No(s). 06-1224 (7th Cir. Aug 17, 2006)

The court holds that coal-fired electric power plants must obtain a permit from the U.S. Environmental Protection Agency (EPA) to make modifications that will increase annual emissions even if the modifications do not increase hourly emissions. The regulation at issue, 40 C.F.R. §52.21, requires a permit for any "major modification," defined as any physical change or change in operating methods, of a major stationary source that would result in a significant increase of regulated emissions. Increases in the hours of operation or in the production rate are both excluded from the definition of "physical change." EPA interprets the regulation to mean that if a physical change enables the plant to increase its output, the exclusion for merely operating the plant for longer hours is inapplicable. The court agrees, concluding that EPA's interpretation is reasonable. Further, to interpret the regulation otherwise would allow a plant to elude the permit requirement and distort the plant's choice between renovating an existing plant and replacing it with a newer, cleaner one.