Who’s to Clean Up Cross-State Pollution? The Answer is Blowin’ in the Wind…

Earlier this week, a DC court of appeals judicial panel struck down the Environmental Protection Agency’s Cross-State Air Pollution Rule (CSAPR), also known as the Transport Rule. From law firm Butler Snow:

“In a 2-1 sharply divided decision, the Court didn’t just remand the rule to EPA for ‘reworking,’ it vacated the rule in toto and sent EPA back to the drawing board. The foundation of the decision is very basic – EPA extended its regulatory grasp well beyond its statutorily authorized reach…

For context, this decision must be framed against another decision of this Court – the 2008 strikedown of the Bush Administration’s Clean Air Interstate Rule (CAIR). Like CSAPR, CAIR would have imposed major new, mandatory reductions of Sulfur Dioxide (SO2) and Nitrogen Oxide (NOx) emissions from power plants, mainly those fueled by coal. It was the first really serious effort to throttle back these emissions from these sources since passage of the Clean Air Act Amendments of 1990.”

What’s next? Three takeaways:

1. The old rule goes back into effect:

“CSAPR was EPA’s second attempt at promulgating national regulation of power plant’s impacting downwind regions. The first was Clean Air Interstate Rule (CAIR), finalized in 2005, which was overturned by the same court in 2008. The rule was ultimately allowed to remain in place while EPA promulgated a replacement. CSAPR was EPA’s attempt at this replacement… If this decision stands, CAIR will continue to remain in place while EPA is once again instructed to promulgate a new rule complying with the Court’s decision and the Clean Air Act.” (Jackson Walker)

2. The EPA can challenge the decision:

“The decision can be appealed — indeed, EPA and the Obama Administration may petition for en banc review by the full D.C. Circuit and/or file a petition for certiorari to the U.S. Supreme Court. Notably, any new federal or state regulatory responses are expected to take years to finalize before becoming effective, which may be a further incentive to the EPA to seek appellate review.” (Cadwalader)

3. The future remains uncertain:

“… another recently promulgated EPA rule, the Mercury and Air Toxics Standards (MATS) rule, imposes new emission control requirements on coal-fired power plants in 2015, unless individual states grant an extension to 2016. Thus, the MATS rule is now the critical path for coal-fired generators to decide whether to repower, retire, or install expensive pollution controls. Decision-makers in the power sector should keep in mind, however, that the MATS rule is also being challenged in Court and that presidential candidate Mitt Romney has supported congressional efforts to overturn MATS. Thus, there continues to be uncertainty as to the emission reduction requirements that will ultimately apply to coal-fired power plants.” (Bracewell & Giuliani)

The updates:

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