EPA’s Cross-State rule gets its day in court

The U.S. Environmental Protection Agency’s (EPA) Cross-State Air Pollution Rule, or CSAPR, gets its day in court on April 13 before a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit.

The EPA is asking that various petitions for review of the rule be denied and that the appeals court’s Dec. 30, 2011, order that stayed implementation of the rule be lifted. Industry groups, meanwhile, are trying to get the rule thrown out.

“This is the main event on the Cross-state rule,” said Jeff Holmstead, an industry lawyer who leads the environmental strategies practice at Bracewell & Giuliani. Industry groups are optimistic about winning on not only the tight compliance deadlines required by the rule but the bulk of CSAPR itself, Holmstead said.

Holmstead served as assistant administrator of the EPA’s Air and Radiation office during the George W. Bush administration.

In 2005, the D.C. Circuit held that a predecessor rule born during the Bush administration, the Clean Air Interstate Rule, or CAIR, did not adequately assure each upwind state would in fact make the necessary emissions reductions.

Ironically, much of the CAIR system actually remains in effect until the courts rule upon the legality of CSAPR, Holmstead noted. The fact that CAIR remains in effect until the successor rule withstands legal appeal is one reason that Holmstead doubts invalidation of CSAPR would cause the same degree of market upheaval as the court defeat of the CAIR standard.

Most observers had thought that only minor modifications would be made to the CAIR program, but it was a surprise when the court threw out the whole regulatory package, Holmstead said.

The federal Clean Air Act requires state implementation plans to prohibit emissions that contribute significantly to non-attainment of clean air standards in another state or interfere with national ambient air quality standards (NAAQS). The act requires EPA to adopt a federal implementation plan if states fail to come up with their own implementation plan.

In the CSAPR case, the appeals court is expected to consider if EPA acted reasonably and lawfully when it used a combined cost-effectiveness and air quality analysis to decide which “upwind” state emissions were “significant” contributors to NAAQS non-attainment and maintenance problems in “downwind” states (as well as the size of each state’s emission budget).

Also at issue is whether EPA acted properly when its issued federal plans to implement CSAPR where none of the states in question had submitted state plans adequately addressing the requirements. The court is also expected to analyze whether the new rule adequately responds to the CAIR court ruling – which handed down in a case brought by the state of North Carolina and various other parties – by determining whether sources in an upwind state interfere with maintenance in a downwind state “independent” of whether those sources significantly contributed to non-attainment in that downwind state.

A big issue is whether EPA acted reasonably in setting compliance deadlines of 2012 and 2014, according to a legal brief filed in March by lawyers representing EPA.

The case is EME Homer City versus EPA, 11-1302.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.