(2) If a request for review of the final Department of Environmental Quality action, or any part thereof, is made on an application for a permit issued under the federal operating permit program established under ORS 468A.310 in accordance with the rules adopted by the commission, the effect of the contested conditions and any conditions that are not severable from those contested shall be stayed upon a showing that compliance with the contested conditions during the pendency of the appeal would require substantial expenditures or losses that would not be incurred if the permittee prevails on the merits of the review and there exists a reasonable likelihood of success on the merits. The department may require that the contested conditions not be stayed if the department finds that substantial endangerment of public health or welfare would result from the staying of the conditions.

(3) Any source under an existing permit shall:

(a) Comply with the conditions of the existing permit during any modification or reissuance proceeding; and

(b) To the extent conditions of any new or modified permit are stayed under subsection (2) of this section, comply with the conditions of the existing permit that correspond to the stayed conditions, unless compliance would be technologically incompatible with compliance with other conditions of the new or modified permit that have not been stayed.

(4) For purposes of this section, a small scale local energy project, as defined in ORS 470.050, located in a maintenance area or nonattainment area, and any infrastructure related to that project located in the same area, is considered to provide a net air quality benefit to the extent required by this chapter if the project provides reductions in each air contaminant in the maintenance area or nonattainment area equal to the ratio specified in rules adopted by the commission, unless the department determines that the project will pose a material threat to compliance with air quality standards in the maintenance area or nonattainment area.

(5) As used in this section:

(a) "Maintenance area" has the meaning given that term in rules adopted by the commission.

(b) "Nonattainment area" has the meaning given that term in rules adopted by the commission. [Formerly 449.727 and then 468.310; 2009 c.519 §1; 2013 c.8 §13]