Blog Post

EPA's New Source Review Program: A Look at Permit Processing Time

Feb 10, 2015 | Arthur G. Fraas

Delays in the permitting of manufacturing, energy, and infrastructure projects have been a continuing focus of concern for industry, Congress, and the Obama administration. The President’s Council on Jobs and Competitiveness included in its recommendations steps to streamline Federal agency permitting processes. The Obama administration has also targeted delays in the permitting of industrial and infrastructure projects as part of its effort to promote economic growth, including the proposal in the 2015 budget for a new Interagency Infrastructure Permitting Improvement Center to be housed at the Department of Transportation.

A long and difficult approval process for development, infrastructure, or plant generation can delay or cancel capacity additions and upgrades, ultimately discouraging progress. In a new RFF discussion paper, “EPA’s New Source Review Program: Evidence on Processing Time, 2002-2014,” my colleagues (Mike Neuner of Louisiana State University and Peter Vail of RFF) and I analyze data on the actual time it takes to assess gas- and coal-fired plant permits through the US Environmental Protection Agency’s (EPA’s) New Source Review (NSR) program.

The NSR program, formed as part of a 1977 amendment to the Clean Air Act, requires that new or major changes at existing plants undergo a preconstruction review that ensure they use the best available technology to limit their emissions. NSR threshold and facility requirements differ based on whether plants are located where air is currently clean or in places where air fails to meet national ambient standards. The process itself can be comprised of up to five stages, and is considered by many developers to be complex, time-consuming, and occasionally costly. Nevertheless, NSR has become especially and increasingly important as the shale gas boom has progressed and will continue playing a significant role in the US push to address climate change in the coming decades.

So how long does the process take in practice? We use EPA data to compare 686 coal, natural gas, and refinery permit requests submitted between January 2002 and September 2014. After identifying five factors that might affect the time it takes EPA to issue NSR permits—type of project, throughput, year submitted, location in an attainment or nonattainment area, and type of permit—we found that the mean length of time it took to process a permit was 420 days.

Although this number represents a national average, permitting time differed depending on the year the permit was submitted, the type of facility requesting a permit, and the region where the permit was submitted. Overall, simple cycle natural gas permits were processed faster on average than all other project types (319 days), whereas refinery project permits took the longest to assess (537 days). We found that a project’s size did not ultimately affect its processing time, and that permitting times vary  significantly across EPA regions. Read the full discussion paper for a full category-by-category breakdown.