Basin Electric seeks stay of Clean Power Plan; Calpine leaps to the plan’s defense

Basin Electric Power Cooperative, one of many parties pursuing appeals of the U.S. Environmental Protection Agency’s Clean Power Plan (CPP) for existing power plants, on Nov. 5 asked the U.S. Court of Appeals for the D.C. Circuit for a stay on the CPP while these combined appeals are being argued.

“This Court should stay the effective date of EPA’s Final Rule (‘the Rule’) pending judicial review and should extend all compliance dates by the number of days between publication of the Rule and a final decision in this consolidated appeal,” Basin wrote.

“EPA has dramatically expanded the reach of its authority to an unprecedented extent,” the cooperative, which has a major amount of coal-fired capacity, added. “Whereas in the past EPA has established standards of performance that apply to individual sources, the Rule regulates the entire electricity generation system, across the nation. Also unlike past regulations, the Rule mandates that sources shut down or reduce operations and that new and different sources of electricity be built to replace them. This is not regulating emissions; it is regulating the production of electricity.

“There are serious questions about the validity of this unparalleled expansion of EPA’s authority and, therefore, there is a strong possibility this Court will vacate the Rule. Meanwhile, compliance with the Rule will require a huge and costly effort by the regulated community, beginning immediately, to develop a vast amount of new electricity generating facilities. Basin Electric Power Cooperative (‘Basin Electric’) alone will have to spend hundreds of millions of dollars while this appeal is pending, unless a stay is granted. Collectively, parties regulated under the Rule will spend billions in that time frame. If this Court vacates the Rule, these resources will have been wasted. Balanced against this probable waste is the fact that neither other parties nor the public will suffer any meaningful harm if a stay is granted. Therefore, the Court should stay the Rule pending judicial review of this case.”

Basin Electric also wrote: “Petitioners are likely to succeed on the merits because EPA has exceeded its statutory authority under the CAA. EPA has impermissibly expanded the reach of its § 111(d) authority beyond the statutory directive to regulate emissions from individual sources, and seeks instead to control the operation of the entire electricity generation and distribution structure in the country. EPA also exceeded its § 111(d) authority by regulating existing sources more stringently than new sources, attempting to use [best system of emission reduction] to reduce output at existing units, and usurping the regulatory powers Congress conferred upon the States. Finally, even if the Rule were within EPA’s authority, the Rule still is neither appropriately justified nor the result of reasoned decisionmaking and, therefore, it is arbitrary and capricious.”

Another Nov. 5 motion for a stay, this one filed by leading U.S. coal producer Peabody Energy, said: “The Rule is a Draconian measure that seeks to shut down coal-fueled Electric Generating Units (‘EGUs’), even though they are traditionally the most reliable and affordable source of electricity. The Rule rests on radical reinterpretations of the Clean Air Act.

“Numerous stay motions have already been filed, including motions by a majority of States in the Union; a coalition of utilities and rural electric cooperatives; leading members of the business community as represented by the U.S. Chamber of Commerce, National Association of Manufacturers, and other trade groups; and the National Mining Association and related entities. Peabody will not duplicate the arguments raised by the previously filed motions, but will instead focus on constitutional concerns raised by the Rule.

“EPA is attempting an unconstitutional trifecta. It seeks: (1) to violate the separation of powers by usurping congressional prerogatives; (2) to violate the Tenth Amendment and principles of federalism by upsetting the federal-state bargain embodied in the Clean Air Act and requiring States to implement (and take the blame for) an anti-consumer federal regulatory program; and (3) to violate the Fifth Amendment by forcing coal companies to bear a burden that ought to be shared by all members of society. The Rule flies in the face of structural principles that operate to check governmental power, safeguard individual liberty, and vindicate ‘the principle that ours is a government of laws, not of men.’ The Rule is a perfect illustration of why these structural principles are necessary. It singles out coal-fueled electric generation for a targeted shutdown even though the emission of CO2 is the byproduct of virtually all human activities.”

Also on Nov. 5, Calpine Corp., the City of Austin d/b/a Austin Energy, the City of Seattle acting through its City Light Department, National Grid Generation LLC and Pacific Gas and Electric asked the appeals court to let them invervene in defense of the Clean Power Plan.

These power generators said: “The Power Companies’ interest in the CPP has been well demonstrated through their active efforts in support of the EPA, including the submission of an extensive collection of comments on the proposed rule. The Power Companies’ interest is further demonstrated by their history of participation before this Court in support of the proposed rule and other recent challenges to [Clean Air Act] rulemakings aimed at reducing pollutant emissions from the power sector. Calpine in particular was granted leave to participate by this Court as amicus curiae in support of the EPA in the premature litigation brought by several of the Petitioners seeking to prevent the EPA from finalizing the CPP.

“Further, National Grid Generation has previously intervened before this Court in support of the EPA in defense of the Mercury and Air Toxics Standards. Calpine has also been granted leave to participate in recent challenges to rulemaking under the CAA in both this Court and the U.S. Supreme Court and, in those cases, offered an authoritative perspective on subjects germane to the outcome of the litigation, such as power market dynamics, reliability of the electricity grid and how competitive markets can be utilized to drive reductions in emissions from the electricity sector. The Power Companies anticipate providing similar perspectives in this case.”

This avalanche of lawsuits against the Clean Power Plan began on Oct. 23, the day that EPA published the final rule in the Federal Register. The plan calls for 32% greenhouse gas reductions from existing power plants by 2030.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.