Judges, attorneys wrangle over whether CO2 plan is ‘transformative’ or incremental

Debate over whether the Environmental Protection Agency (EPA) Clean Power Plan is a “transformative” rulemaking and if EPA is overstepping its bounds, were among issues that dominated opening hours of legal wrangling Sept. 27 before the U.S. Court of Appeals for the District of Columbia Circuit.

GenerationHub reviewed the audio webcast of the opening hours of the Sept. 27 legal arguments before the D.C. Circuit. Listeners should be warned that the quality of the audio is less-than-ideal while the various attorneys for the parties are speaking.

The audio quality of the judges is far better.

The rule would have states draft implementation plans to cut power sector carbon dioxide (CO2) emissions 32% by 2030.

In an unusual move, the rule was stayed, pending litigation, earlier this year by the U.S. Supreme Court. The D.C. Circuit took the extraordinary step of skipping over a three-judge appellate panel and going right to a full en banc hearing, with 10 judges hearing the case (West Virginia v. EPA) at the D.C. Circuit.

Comments by the various lawyers and appeals court judges noted the high stakes involved. Legal counsel for coal states and coal-fired utilities argued the rule could devastate the existing coal power fleet.

One appeals court judge noted that the rule has been associated with everything from the United States ability to comply with global warming agreements to statements by the Pope.

Is EPA effectively requiring a different generation mix?

West Virginia Solicitor General Elbert Lin asserted that EPA has invoked a “little-used provision of the Clean Air Act” to create a new vision of the clean energy economy.

Although coal plant retirements are already a power industry trend absent the Clean Power Plan, Lin said the EPA CO2 program would be particularly harsh on West Virginia, which gets 96% of its electricity from coal.

The CPP emission rules cannot be met by any existing single coal power plant, Lin said. This is “very different from what Section 111(D) is about,” and how it’s been used in the past, Lin said.

Compliance with the Clean Power Plan can only be accomplished by “restructuring” the electric generation mix, Lin said. “This is a power that not even the Federal Energy Regulatory Commission has,” Lin added.

While EPA has authority to regulate carbon it doesn’t necessarily have the power to run most coal-fired power plants out of business, said industry attorney Peter Keisler.

EPA has historically employed “a lighter touch” in regulating existing source of generation, because the infrastructure investment has already been made, Keisler said.

EPA has told coal plant owners in effect that they must build a wind farm that might be hundreds of miles away, Keisler said. EPA cannot set up a rule that effectively “requires” a company to build a new source of generation in order to keep another power generation source in business, Keisler said.

Keisler seemed to suggest that that the CPP regulations go further than merely forcing new technology into the marketplace but effectively require “generation switching.”

A Justice Department attorney countered this by saying that carbon capture and sequestration (CCS) is a demonstrated technology available to coal plants — although it is more costly than shifting generation sources.

Justice Department attorneys argued that global warming and climate changes present a crisis and EPA has proposed reasonable program to address it.

But a couple of the appeals court judges seemed skeptical that EPA has been granted explicit authority by Congress to make such a far-ranging policy. It is a poor argument to say that EPA must act because congress has failed to act, said one appeals court judge said on the audio recording.

Another judge said that Congress is supposed to make the big decisions, although the CPP is a “laudable” goal given that the earth is warming.

Some speakers also made reference to past efforts by Congress to address carbon dioxide (CO2) policy. For example, the Waxman-Markey CO2 emissions trading program was proposed early in the Obama administration but failed to pass both congressional chambers.

The consolidated case before the D.C. Circuit is 15-1363 State of West Virginia v. EPA.

The D.C. Circuit audio webcast can be found at www.cadc.uscourts.gov/recordings/recordings.nsf/

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.