January 23, 1988

The President has instructed his advisers to continue discussions with their Canadian counterparts toward completion of a bilateral air quality accord. He reiterated his commitment to implement the recommendations of the 1986 Special Envoys' report, committing fully to proceeding with the Innovative Control Technologies Program.

The Innovative Control Technologies Program is a 5-year, joint Federal and industry $5 billion effort to encourage the development and deployment of innovative technologies designed to reduce power plant emissions that are thought to cause acid rain. The President will request the full amount of the Federal Government's share in this program.

Additionally, the President has accepted the recommendations of his Task Force on Regulatory Relief, chaired by the Vice President. These recommendations are designed to eliminate regulatory barriers to the deployment of innovative emissions control technologies and to other cost-effective emissions reductions measures. The specific recommendations of the Task Force are:

Preferential treatment, under the Innovative Control Technologies Program, for projects in States that, for ratemaking purposes, treat innovative technologies the same as pollution control projects. This treatment would recognize the additional risk inherent in demonstration of innovative technologies.

A Federal Energy Regulatory Commission (FERC) 5-year demonstration program allowing rate incentives for innovative technologies. This would also recognize the risk inherent in demonstration of innovative technologies. FERC already provides this type of incentive in certain circumstances.

The Environmental Protection Agency (1) encourages the States to consider achieving greater ozone reduction through interpollutant trading and other measures that substitute less expensive nitrogen oxide emissions reductions for more expensive volatile organic compound emissions reductions, (2) encourage the use of "bubbles'' between recently built emissions sources, (3) expand commercial demonstration permits for innovative control technologies, and (4) encourage complementary use of emissions ``bubbles'' and waivers for innovative technology applications.