New Source Review
The California New Source Review permit program is derived from the California Clean Air Act. NSR requirements arising from the California Clean Air Act are codified in the California Health and Safety Code at Division 26. Specific to NSR, each District is to include in its attainment plan, a stationary source control program designed to achieve no net increase in emissions of nonattainment pollutants or their precursors for all new or modified sources that exceed particular emission thresholds. In addition, most new and modified stationary sources are required to use Best Available Control Technology (BACT). In California, BACT is synonymous with the federal term Lowest Achievable Emission Rate (LAER) for nonattainment area permit requirements.
Each of the 35 Air Pollution Control Districts in California has its own NSR program and issues its own NSR or Prevention of Significant Deterioration permits to construct and operate. To do so, each district has adopted its own rules and regulations to comply with State and federal laws. These regulations usually incorporate both the California and federal regulations into one or more rules. Depending on the quantity of emissions of air pollutants that will be emitted from the source and the area designation for that pollutant, the new or modified source may be required to install BACT. In addition, new and/or modified sources in California may be required, depending on the type and quantity of pollutants emitted, to mitigate or "offset" the increases in emissions that result after installation of BACT/LAER. Conversely, if a source shuts down a permitted emission unit, or decreases emissions greater than what is required by any district, state or federal rule, it may receive emission reduction credits that it may use at a later date to offset new emissions, or can sell to another facility that may be increasing its emissions. The cost of these emission reduction credits is set by the owner of the credits and varies depending on type of pollutant and the District in which they are generated.