Another Loss For the Bush EPA; The D.C. Court of Appeals Remands the Fine Particulate Standard

Posted on February 27, 2009 by Seth Jaffe

The batting average of the Bush administration EPA in appeals of its regulatory proposals may now have dropped below the proverbial Mendoza line. This week, the Court of Appeals for the District of Columbia remanded a substantial part of EPA’s particulate rule. That the Bush administration could achieve results where the Mendoza line is even a close metaphor is a testament to just how low its stock has fallen in the courts.

 

The case itself is important for a number of reasons, but is too lengthy for detailed analysis here. Highlights include:

·                     First, the basic holding: the court remanded EPA’s primary annual standard for PM2.5, because EPA did not justify that the 15 ug/m3 standard was sufficient to protect public health with an adequate margin of safety. Second, the court also remanded EPA’s determination of the secondary, public welfare, standard for PM2.5.

·                     The court gave great weight to the role of the Clean Air Science Advisory Committee (CASAC) and staff recommendations in the regulatory process. After this decision, EPA is going to think twice about choosing a regulatory course difference than that recommended by CASAC and staff. On balance, I think that this is a bad thing and more evidence of the collateral damage from the extreme positions taken by the Bush administration. After all, while the Clean Air Act sets some boundaries, these are ultimately policy decisions that should be made by the President and his or her chosen staff, not by a committee no one’s heard of or low-level staff.

·                     Unlike the chaos created when the court vacated the CAIR regulations, the court appears to have learned its lesson. This time around, the court remanded the rule, but left the standard in place for now.

·                     The court’s decision to remand the public welfare standard will have implications for current efforts to implement the its Regional Haze Rule. The extent to which this decision throws Haze Rule implementation back to the drawing board may not be known for some time.

How many more cases can the Bush administration lose after it’s already out of office? At least one. Greenwire reports today about speculation that this decision means that the EPA rules regarding the nitrogen oxide NAAQS may also be in trouble.

The interesting question in all this is the extent to which the abysmal record of the Bush EPA in defending its decisions in the courts will damage EPA’s credibility and thus result in a long-term weakening of the deference given EPA by the courts. At this point, my assumption is that, in the long run, these cases will be seen as an aberration and courts will resume their prior practice of granting EPA substantial deference. Of course, whether that is a good thing or not is a separate question.

Another Loss For the Bush EPA; The D.C. Court of Appeals Remands the Fine Particulate Standard

Posted on February 27, 2009 by Seth Jaffe

The batting average of the Bush administration EPA in appeals of its regulatory proposals may now have dropped below the proverbial Mendoza line. This week, the Court of Appeals for the District of Columbia remanded a substantial part of EPA’s particulate rule. That the Bush administration could achieve results where the Mendoza line is even a close metaphor is a testament to just how low its stock has fallen in the courts.

 

The case itself is important for a number of reasons, but is too lengthy for detailed analysis here. Highlights include:

·                     First, the basic holding: the court remanded EPA’s primary annual standard for PM2.5, because EPA did not justify that the 15 ug/m3 standard was sufficient to protect public health with an adequate margin of safety. Second, the court also remanded EPA’s determination of the secondary, public welfare, standard for PM2.5.

·                     The court gave great weight to the role of the Clean Air Science Advisory Committee (CASAC) and staff recommendations in the regulatory process. After this decision, EPA is going to think twice about choosing a regulatory course difference than that recommended by CASAC and staff. On balance, I think that this is a bad thing and more evidence of the collateral damage from the extreme positions taken by the Bush administration. After all, while the Clean Air Act sets some boundaries, these are ultimately policy decisions that should be made by the President and his or her chosen staff, not by a committee no one’s heard of or low-level staff.

·                     Unlike the chaos created when the court vacated the CAIR regulations, the court appears to have learned its lesson. This time around, the court remanded the rule, but left the standard in place for now.

·                     The court’s decision to remand the public welfare standard will have implications for current efforts to implement the its Regional Haze Rule. The extent to which this decision throws Haze Rule implementation back to the drawing board may not be known for some time.

How many more cases can the Bush administration lose after it’s already out of office? At least one. Greenwire reports today about speculation that this decision means that the EPA rules regarding the nitrogen oxide NAAQS may also be in trouble.

The interesting question in all this is the extent to which the abysmal record of the Bush EPA in defending its decisions in the courts will damage EPA’s credibility and thus result in a long-term weakening of the deference given EPA by the courts. At this point, my assumption is that, in the long run, these cases will be seen as an aberration and courts will resume their prior practice of granting EPA substantial deference. Of course, whether that is a good thing or not is a separate question.

OBAMA AND THE ENVIRONMENT

Posted on February 24, 2009 by Elliot Laws

As Lisa Jackson completes her first month as President Obama’s environmental chief, she is just scratching the surface on some of the myriad issues that will likely have impacts far beyond typical environmental concerns, for decades to come. There has to be some mixture of excitement and fear facing this new administration, as the challenges before it dwarf all of those in memory. That mixture will be especially prevalent at EPA. Usually in times like these — war, recession, high unemployment –— environmental issues can be expected to fade from the front pages. An EPA administrator would receive the old admonition to be seen and not heard. However, unlike past crises environmental issues are in the forefront — primarily in the form of climate change and energy. It is notable that when the government is lending billions of dollars to Citibank and debating the very existence of the big three automakers, one of the first actions of the incoming Obama administration has been to review EPA’s previous decision to deny California’s petition for a Clean Air Act waiver to allow it to regulate greenhouse gases from mobile sources.

 

 

The expectations for success that many Obama supporters have are high. Those expectations are high in the environmental community — perhaps too high. The ongoing financial collapse in the United States and abroad has changed the landscape in ways that could not have been imagined as recently as August, when Obama accepted the Democratic nomination for president. With the federal government having committed nearly $1 trillion in an attempt to save financial institutions across the country; with Congress passing an economic stimulus package costing an additional $750 billion; with the United States still conducting wars in Afghanistan and Iraq, outside of the infusion of stimulus cash for “shovel-ready projects” the expectation that EPA’s budget will experience significant increases over the Bush years is hardly a reasoned view. It’s not just the mind boggling challenge facing us on the economy, it’s also the difficult decisions that must be made to address climate change; it’s the need to seriously address the nation’s nearly suicidal dependence on foreign oil; and it’s myriad other issues that will all require hard choices and sacrifice.

 

Those expectations are probably low in the business community — as they normally are when the country shifts from a Republican to a Democratic administration. And similarly, those expectations are perhaps too low. I believe if this president will be true to one of his campaign promises, it is to govern in a way that puts partisanship on the sidelines. He has already proved that commitment by sending a strong signal to Senate Democrats that he does not wish to see retaliation against Senator Joe Lieberman (I-Connecticut) for his support not only of John McCain, but also Republican senatorial candidates in Minnesota, Maine, and Oregon. What Obama signaled with that position is that he is not going to put partisanship ahead of his plans to help America, even if partisans refuse his offers to join him.. He is looking at new alliances and will work with people who were not shy in their opposition to his election as he works as president. The mantra of “no permanent friends; no permanent enemies” is likely to be the Obama approach to working in Washington, DC.

 

We as a nation are facing an uncertain future. The environment is likely going to play a larger role in the lives of average Americans than it has since its heyday in the 1970s. Lisa Jackson has the monumental task of rallying an agency suffering from low morale, with precious few additional resources, to make decisions in perhaps the most hotly debated and controversial area of environmental law and policy ever. She will make recommendations and decisions that will have implications not only on the very future of the United States, but likely for the world as well. To the NGO community, the challenge is not to be disappointed as this president makes decisions that balance multiple important considerations and who will often decide that another consideration must trump the environmental choice. To the business community, the challenge is to be more optimistic and to show the initiative and courage necessary to work with this new administration and its traditional allies to solve the monumental problems facing the world.

EPA's Roll-Back of Bush-Era Rules Appears to Begin in Earnest

Posted on February 13, 2009 by Seth Jaffe

While a lot of attention has been paid to whether EPA would reverse the Bush EPA decision denying California’s petition to regulate greenhouse gas emissions from mobile sources,  it is now clear even outside the climate change arena that life at EPA is going to be substantially different under the current administration.  As if evidence were really needed for that proposition, EPA announced this week that it was putting on hold the NSR aggregation rule that EPA had promulgated on January 15, 2009.

The rule, which had been long sought by industry, would have provided that nominally separate projects would only have to be combined – aggregated for NSR/PSD purposes – if  they are “substantially related.” It also would have created a rebuttable presumption that projects more than three years apart are not substantially related. Responding to a request from NRDC and the OMB memo asking agencies to look closely at rules promulgated before the transition but not yet effective, EPA concluded that the rule raises “substantial questions of law and policy.” Therefore, EPA postponed the effective date of the rule until May 18, 2009 and also announced that it was formally reconsidering the rule in response to the NRDC petition.

To those in industry, the aggregation rule was not a radical anti-environmental roll-back of environmental protection standards.  Rather, it was more of a common-sense approach towards making the NSR program simpler and clearer.  It is one of my pet peeves with the prior administration, however, that it gave regulatory reform a bad name.  

In any case, I feel as though I should open a pool regarding what will be the next Bush-era rule to be tossed overboard.  We surely won’t have to wait long for it to happen.

A Quick Economic Stimulus Meets a Slow Environmental Process - Are NEPA Waivers Needed to Reach Energy Independence?

Posted on January 30, 2009 by Bradley Marten

President Obama has pressed Congress this week to enact an economic stimulus package that would “double our capacity to generate alternative sources of energy like wind, solar, and biofuels . . . and build a new electricity grid that lay down more than 3,000 miles of transmission lines to convey this new energy from coast to coast.”[i] On Wednesday, January 28, 2009, the House passed the American Recovery and Reinvestment Act of 2009 (H.R. 1), which contains nearly $15 billion in capital investments and loan guarantees for renewable energy projects and new electric transmission lines, and $18.5 billion for energy efficiency programs.  The Administration’s stated goal is to spend this money in the next 18 months. This may be possible for the energy efficiency projects such as weatherizing homes and government buildings.  But for dozens of new wind farms and thousands of miles of transmission lines, it is not, and a good part of the reason is that those projects have yet to undergo environmental review or receive necessary permits.



[i] These remarks came in the President’s first weekly address, which was delivered on Saturday, January 24, 2009. The address can be viewed at this link.

 

Typically, siting a transmission line, wind farm, or other major energy facility involves obtaining a long list of environmental permits, each of which has a review process that can be used by opponents of the project to delay and sometimes defeat it. Moving infrastructure projects forward quickly will only be possible if Congress and the Administration speed up the environmental review and permitting process.  

In a January 26, 2009, report, the Congressional Budget Office estimates that it will take up to seven years to spend the money that H.R. 1 dedicated to expanding alternative energy. Experience teaches that this estimate may be overly conservative. For example, the Arrowhead-Weston Transmission Project, a 220 mile transmission line from Wisconsin to Minnesota, took nine years to permit and construct, even though all but 50 miles of it were in existing transmission line corridors. Southern California Edison’s Tehachapi Transmission Project, a 250 mile transmission project to deliver electricity generated from wind farms in Southern California, took over 10 years to design, permit, and begin construction. Indeed, portions of the project are still undergoing environmental review by the U.S. Forest Service and others.

Recently, California Governor Arnold Schwarzenegger requested up to $44 billion for transportation, energy and water projects in California, claiming that these projects will create as many as 800,000 new jobs.  Knowing that traditional environmental review would slow short-term job creation, Governor Schwarzenegger asked the Obama Administration to “waive or greatly streamline National Environmental Protection Act requirements consistent with our statutory proposals to modify the California Environment Quality Act for transportation projects.”

The proposal drew immediately fire from environmental groups. In a January 13, 2009, letter to House and Senate Democratic leaders, the Environmental Defense Fund, the Natural Resources Defense Council, the League of Conservation Voters and Environment California called Governor Schwarzenegger’s proposal “unproductive and harmful” to the federal debate over reviving the economy.  “Inevitably, in the course of congressional consideration, special interests will assert that we cannot afford the NEPA process in a time of national urgency,” they said.  “The truth is that we cannot afford that kind of leap-before-you-look rashness.” 

The new Administration must navigate this tension – quickly addressing the economic crisis while maintaining the integrity of the environmental review process. Doing so will require identifying ways that environmental review and permitting can be streamlined and modernized, alongside the infrastructure system.  We ought to be able to get wind farms and bridges and light rail built in a time frame that provides the short-term stimulus our economy needs, and also allow for sufficient environmental review to make sure our resources are protected.   This article lays out some of the options the new Administration may wish to consider as it seeks to balance job creation with environmental stewardship.

Approaches for Streamlining the Environmental Review Process

Use Existing Provisions Allowing Temporary Waivers

 

Many environmental regulatory statutes contain waivers of applicable requirements in response to natural disasters or other emergency conditions.  For example, the Stafford Disaster Relief and Emergency Assistance Act authorizes NEPA waivers to facilitate prompt responses to natural disasters.[1]  Similarly, the White House Council of Environmental Quality (CEQ) is authorized to approve “alternative arrangements” allowing federal agencies to modify or limit NEPA review in response to natural disasters.[2]  Other federal environmental laws with emergency response provisions include the Clean Water Act[3] and CERCLA.[4]

In response to Hurricane Katrina, CEQ approved expedited NEPA review procedures for certain U.S. Army Corps of Engineers flood control projects.  EPA temporarily waived certain Clean Water Act, Clean Air Act, and other environmental regulations in Katrina’s wake.  Both Louisiana and Mississippi issued similar emergency administrative orders, temporarily suspending certain environmental regulations to facilitate clearing hurricane debris and other emergency response actions.

Waivers Based on Grounds of National Security

In 2002, after the Natural Resources Defense Council obtained a preliminary injunction halting the U.S. Navy’s use of a low-frequency, active, surveillance towed array sonar system,[5] President Bush issued a “Presidential Exemption from the Coastal Zone Management Act,”[6] in order to “ensure effective and timely training of the United States naval forces in anti-submarine warfare using mid-frequency active sonar.”  The Presidential exemption allowed the Navy to train and certify strike groups capable of deployment “in support of world-wide operational and combat activities, which are essential to national security.”

The United States Supreme Court upheld the President’s action, finding that the public interest in adequately training the Navy’s antisubmarine forces “plainly outweighs” conservationists’ interests in studying marine mammals that may be injured by sonar exercises.[7]

Legislative Exemptions for Specific Projects

 

Congress has also periodically either limited or exempted review under NEPA and other environmental statutes for specific projects or categories of projects.  For example, the Energy Policy Act of 2005 modified the environmental compliance requirements for a broad range of energy-related projects.  The modified environmental compliance measures included:

  • Establishing a rebuttable presumption that certain oil and gas projects conducted on federal land are categorically exempted from NEPA review (§ 390);
  • Exempting hydraulic fracturing in aid of oil, gas, and geothermal energy extraction from certain requirements in the Safe Drinking Water Act (§ 322);
  • Exempting oil and gas exploration, production, and transportation construction projects from the Clean Water Act’s construction stormwater regulations (§ 323);
  • Requiring EPA and federal land management agencies in Western states to develop a pilot project to expedite environmental review and permitting under NEPA, the ESA, the Clean Water Act, and other federal statutes (§ 365);
  • Expediting the permitting process for natural gas facilities located on federal lands (§ 366); and
  • Shortening the time frame for appealing permitting decisions under the Coastal Zone Management Act (§ 381).

Congress has also exempted or provided limited NEPA review for other projects, for example:

·        The TransAlaska Pipeline was exempted from NEPA review after completion of the initial EIS (43 U.S.C. § 1625(d));

·        Certain actions taken pursuant to the Clean Air Act are exempted from NEPA review (15 U.S.C. § 793(c)(1));

·        Department of Energy decisions to grant or deny exemptions from regulations governing fuel use at coal-fired power plants are exempted from NEPA review (42 U.S.C. § 8473);

·        For certain retrievable radioactive waste storage projects, an Environmental Assessment (as opposed to an EIS) constitutes sufficient compliance with NEPA (42 U.S.C. § 10155(c)(2)(A));

·        Alternate environmental review procedures have been established for determining surface transportation rights-of-way in the Arctic National Preserve (42 U.S.C. § 410hh(4)(d); and

·        Certain Department of Housing and Urban Development funding decisions are exempt from NEPA review, based on certification of compliance with state and local laws (42 U.S.C. § 3547(2)).

Using Streamlined Environmental Review to Address Economic Conditions

 

While legislative, regulatory, and executive precedent exists for either waiving or limiting environmental review, those precedents have rarely been used to justify waiving environmental review on the grounds of an economic crisis.[8]  But precedent exists for using “alternative arrangements” for environmental review in response to economic concerns.  In 1980, after General Motors threatened to build a new manufacturing facility outside the city limits unless the city cleared and delivered an appropriate site for the facility, the City of Detroit declared a state of emergency based on an economic crisis.  In September 1980, CEQ approved an “alternative arrangement” under NEPA allowing the Department of Housing and Urban Development to release loan guarantee funds prior to the completion of NEPA review.[9]

The challenge for the new Administration and Congress is to strike a balance between expediting environmental review while maintaining sufficient oversight to prevent bad decision making.  Options to achieve that goal include: (1) expediting funding for “shovel ready” projects which already have undergone federal and state environmental review and obtained necessary permits; (2) using programmatic environmental review of project categories that would obviate the need for project-specific (and often redundant) environmental reviews; (3) providing limited exemptions or streamlined environmental review for specific categories of projects; and (4) limiting judicial review of final agency approvals for projects funded by the stimulus bill, while providing for oversight, review, and approval by CEQ.

For more information, please contact Bradley Marten



[1] See 42 U.S.C. § 5159.

[2] 40 CFR § 1506.11.

[3] Under 40 CFR § 122.3, the President or an agency acting with delegated Presidential authority may grant a waiver of the NPDES requirement if necessary to address substantial threats to public health or welfare. EPA invoked this exception in response to Hurricane Katrina. Another exception is 40 CFR § 122.41(n), which allows a wavier in the event of an “upset,” which is the temporary failure to comply with NPDES permit conditions based on factors that are beyond the reasonable control of an operator, for example, a power failure or a large spill of contaminants into a collection and treatment system.

[4] CERCLA provides the President and EPA with broad authority and flexibility to undertake response actions whenever there is a release or threatened release of a hazardous substance which presents an imminent and substantial danger. See 40 CFR § 300.400(e)(1).

[5] See NRDC v. Evans, 232 F. Supp.2d 1003 (N.D. Cal. 2002) (for more information on this decision, see Colleen C. Karpinsky, A Whale of a Tale: The Sea of Controversy Surrounding the Marine Mammal Protection Act and the U.S. Navy’s Proposed Use of the SURTASS-LFA Sonar System, 12 Penn St. Envtl. L. Rev. 389 (2004)).

[6] Per its terms, the Presidential Exemption was based on the “Constitution and the laws of the United States, including section 1456(c)(1)(B) of title 16, United States Code.”

[7] Winters v. Natural Resources Defense Council, Inc., 555 U.S. ___, 129 S. Ct. 365 (2008).

[8] While NEPA allows agencies to allow “alternative arrangements” suspending or modifying environmental review, CEQ regulations limit their applicability to “actions necessary to control the immediate impact of the emergency.” 40 CFR § 1506.11 (emphasis supplied).

[9] Although the full NEPA review was eventually completed, the “alternative arrangement” allowed HUD and the city to expedite project activities in response to an economic crisis. The facts of the Detroit “alternative arrangement” are summarized at Crosby v. Little, 512 F. Supp. 1363 (E.D. Mich. 1981).

EPA IN THE DC CIRCUIT - WHERE HAS ALL THE DEFERENCE GONE?

Posted on September 23, 2008 by Linda Bochert
  • June 2007: DC Circuit Hands EPA and Industry Two Defeats:  Court Rejects EPA MACT Air Rules for Commercial and Industrial Boilers and Plywood and Composite Wood Products
  • February and July 2008: DC Circuit to EPA: Multi-Pollutant Strategy for Interstate Clean Air Fails to Meet Clean Air Act Requirements

Several recent cases have raised the following question in my mind: can EPA win an air case in the DC Circuit?

They teach us in law school that governmental agencies can expect a reasonable degree of deference from a reviewing court when exercising statutory authority to develop regulations to implement Congressional directives. States and entities subject to EPA’s regulations need something to rely on, and expect EPA and the Courts to provide some degree of predictability and certainty in the application of the regulations. Yet deference is nowhere to be found in the DC Circuit’s recent reviews of several EPA regulations implementing the Clean Air Act (CAA). And in each of the cases discussed below, the Court opted for the most dramatic remedy – vacatur of the offending rule.

These decisions can be sliced and diced from a variety of perspectives. At the least I think they raise vexing concerns about deference and choice of remedy. What do you think – are these the trend or the anomalies? Is this a real concern or much ado about nothing?

 

Here are my examples:

 1. June 2007: Commercial and Industrial Boiler MACT Rules

On June 8, 2007, in Natural Resources Defense Council v. EPA, No. 04-1385 (D.C. Cir. June 8, 2007) (NRDC I) the DC Circuit struck down two EPA rules setting air toxics limitations for commercial and industrial boilers and solid waste incinerators: National Emission Standards for Hazardous Air Pollutants for Industrial, Commercial, and Institutional Boilers and Process Heaters (Boilers Rule) and Standards of Performance for New Stationary Sources and Emission Guidelines for Existing Sources: Commercial and Industrial Solid Waste Incineration Units (CISWI Definitions Rule).

At issue were the emission standards for hazardous air pollutants (HAPs) emitted from commercial and industrial solid waste incinerators and industrial boilers and the appropriate setting of the Maximum Achievable Control Technology (MACT) standard.

The challenge was brought by environmental petitioners Natural Resources Defense Council, Sierra Club, and the Environmental Integrity Project. The Court agreed with them that EPA had impermissibly narrowed the definition of “commercial or industrial waste” in the CISWI Definitions Rule in violation of the plain language of section 129 of the Clean Air Act. Because the Boilers Rule was dependent on that same definition, both rules were rejected by the Court. EPA and industry representatives, including the Coalition for Responsible Waste Incineration, Utility Air Regulatory Group, and Utility Solid Waste Activities Group, contended that EPA’s definition was within the agency’s discretion, but the Court was not persuaded.

 

2. June 2007: Plywood and Composite Wood Products MACT Rules

On June 19, 2007, the DC Circuit dealt a second blow in a challenge to EPA’s rules to regulate HAPs from processing plywood and composite wood products (PCWP). Also named Natural Resources Defense Council v. EPA, No. 04-1323 (D.C. Cir. June 19, 2007) (NRDC II), this case was also brought by the Natural Resources Defense Council, Sierra Club and the Environmental Integrity Project against EPA. EPA was supported by industry groups, including the American Forest and Paper Association.

The two rules involved in this case were the National Emission Standards for Hazardous Air Pollutants: Plywood and Composite Wood Products (2004 Rule) and the National Emission Standards for Hazardous Air Pollutants: Plywood and Composite Wood Products; List of Hazardous Air Pollutants, Lesser Quantity Designations, Source Category List (2006 Rule), with the primary challenge to the 2006 Rule. Example of operations regulated by these rules include sawmills with lumber kilns, hardwood and softwood plywood and veneer plants, particleboard/fibreboard and other reconstituted wood product plants, and engineered wood product plants.

Once again, the issue was the appropriate MACT standard. In this case the pivotal elements were EPA’s decisions in the 2004 Rule to create a “low-risk subcategory” and in the 2006 Rule to extend the compliance deadline from October 2007 to October 2008.

 

3. February 2008: Clean Air Mercury Rule (CAMR)

On February 8, 2008, the DC Circuit struck down CAMR in New Jersey v. EPA, No. 05-1097 (D.C. Cir. Feb. 8, 2008). CAMR was the result of EPA’s decision to remove oil and coal-fired electric utility steam generating units (EGUs) from the list of sources of hazardous air pollutants (HAPs) and instead regulate mercury emissions from these EGUs through a cap-and-trade program similar to the Clean Air Interstate Rule (CAIR).

In response, New Jersey, and several other states, municipal governments and environmental groups, challenged CAMR claiming that EPA had no authority to delist the EGUs without providing a “specific finding” under section 112(c)(9) of the CAA. Because EPA did not make this specific finding, the Petitioners claimed that not only was the delisting invalid, but CAMR was also flawed because it was based upon this delisting decision. The DC Circuit agreed with the Petitioners, vacating both the delisting rule and CAMR.

 

4. July 2008: Clean Air Interstate Rule (CAIR)

On July 11, 2008, the D.C. Circuit vacated CAIR in North Carolina v. EPA, No. 05-1244 (D.C. Cir. July 11, 2008).

The multi-party challenge to CAIR was brought by the state of North Carolina, several electric utilities (SO2 Petitioners), specific electric utilities in Texas, Florida and Minnesota, one municipality, and the Florida Association of Electric Utilities (FAEU). The electric utilities in Texas, Florida and Minnesota challenged CAIR’s applicability to them because of their location and emissions amounts. North Carolina, the SO2 Petitioners, and FAEU brought substantive challenges to the regulation, claiming that EPA did not have the discretion to act as it did, or it did so unreasonably.

The Court agreed with North Carolina and the SO2 Petitioners, holding that CAIR failed to meet the requirements of the CAA and finding “EPA’s approach – regionwide caps with no state-specific quantitative contribution determinations or emissions requirements – is fundamentally flawed.”

 Is vacatur the best remedy?

 In all four of these cases, the Court chose to vacate rather than remand the rules. The dissent in the CISWI/Boilers Rules case unsuccessfully argued that remand without vacating the rules was preferable“[b]ecause the rules would ensure greater protection to public health and the environment during the time EPA will need to develop and promulgate new rules.” The majority was unpersuaded and preferred no rules at all. Is that really the best option for the environment?

And the language the Court uses implies more than a lack of deference. In vacating CAIR, a decision described as “unexpected” by both proponents and opponents, the Court described the rule as “fundamentally flawed” and directed EPA to “redo its analysis from the ground up.” In vacating CAMR, the Court characterized EPA as “deploy[ing] the logic of the Queen of Hearts.” What’s going on here?

EPA IN THE DC CIRCUIT - WHERE HAS ALL THE DEFERENCE GONE?

Posted on September 23, 2008 by Linda Bochert
  • June 2007: DC Circuit Hands EPA and Industry Two Defeats:  Court Rejects EPA MACT Air Rules for Commercial and Industrial Boilers and Plywood and Composite Wood Products
  • February and July 2008: DC Circuit to EPA: Multi-Pollutant Strategy for Interstate Clean Air Fails to Meet Clean Air Act Requirements

Several recent cases have raised the following question in my mind: can EPA win an air case in the DC Circuit?

They teach us in law school that governmental agencies can expect a reasonable degree of deference from a reviewing court when exercising statutory authority to develop regulations to implement Congressional directives. States and entities subject to EPA’s regulations need something to rely on, and expect EPA and the Courts to provide some degree of predictability and certainty in the application of the regulations. Yet deference is nowhere to be found in the DC Circuit’s recent reviews of several EPA regulations implementing the Clean Air Act (CAA). And in each of the cases discussed below, the Court opted for the most dramatic remedy – vacatur of the offending rule.

These decisions can be sliced and diced from a variety of perspectives. At the least I think they raise vexing concerns about deference and choice of remedy. What do you think – are these the trend or the anomalies? Is this a real concern or much ado about nothing?

 

Here are my examples:

 1. June 2007: Commercial and Industrial Boiler MACT Rules

On June 8, 2007, in Natural Resources Defense Council v. EPA, No. 04-1385 (D.C. Cir. June 8, 2007) (NRDC I) the DC Circuit struck down two EPA rules setting air toxics limitations for commercial and industrial boilers and solid waste incinerators: National Emission Standards for Hazardous Air Pollutants for Industrial, Commercial, and Institutional Boilers and Process Heaters (Boilers Rule) and Standards of Performance for New Stationary Sources and Emission Guidelines for Existing Sources: Commercial and Industrial Solid Waste Incineration Units (CISWI Definitions Rule).

At issue were the emission standards for hazardous air pollutants (HAPs) emitted from commercial and industrial solid waste incinerators and industrial boilers and the appropriate setting of the Maximum Achievable Control Technology (MACT) standard.

The challenge was brought by environmental petitioners Natural Resources Defense Council, Sierra Club, and the Environmental Integrity Project. The Court agreed with them that EPA had impermissibly narrowed the definition of “commercial or industrial waste” in the CISWI Definitions Rule in violation of the plain language of section 129 of the Clean Air Act. Because the Boilers Rule was dependent on that same definition, both rules were rejected by the Court. EPA and industry representatives, including the Coalition for Responsible Waste Incineration, Utility Air Regulatory Group, and Utility Solid Waste Activities Group, contended that EPA’s definition was within the agency’s discretion, but the Court was not persuaded.

 

2. June 2007: Plywood and Composite Wood Products MACT Rules

On June 19, 2007, the DC Circuit dealt a second blow in a challenge to EPA’s rules to regulate HAPs from processing plywood and composite wood products (PCWP). Also named Natural Resources Defense Council v. EPA, No. 04-1323 (D.C. Cir. June 19, 2007) (NRDC II), this case was also brought by the Natural Resources Defense Council, Sierra Club and the Environmental Integrity Project against EPA. EPA was supported by industry groups, including the American Forest and Paper Association.

The two rules involved in this case were the National Emission Standards for Hazardous Air Pollutants: Plywood and Composite Wood Products (2004 Rule) and the National Emission Standards for Hazardous Air Pollutants: Plywood and Composite Wood Products; List of Hazardous Air Pollutants, Lesser Quantity Designations, Source Category List (2006 Rule), with the primary challenge to the 2006 Rule. Example of operations regulated by these rules include sawmills with lumber kilns, hardwood and softwood plywood and veneer plants, particleboard/fibreboard and other reconstituted wood product plants, and engineered wood product plants.

Once again, the issue was the appropriate MACT standard. In this case the pivotal elements were EPA’s decisions in the 2004 Rule to create a “low-risk subcategory” and in the 2006 Rule to extend the compliance deadline from October 2007 to October 2008.

 

3. February 2008: Clean Air Mercury Rule (CAMR)

On February 8, 2008, the DC Circuit struck down CAMR in New Jersey v. EPA, No. 05-1097 (D.C. Cir. Feb. 8, 2008). CAMR was the result of EPA’s decision to remove oil and coal-fired electric utility steam generating units (EGUs) from the list of sources of hazardous air pollutants (HAPs) and instead regulate mercury emissions from these EGUs through a cap-and-trade program similar to the Clean Air Interstate Rule (CAIR).

In response, New Jersey, and several other states, municipal governments and environmental groups, challenged CAMR claiming that EPA had no authority to delist the EGUs without providing a “specific finding” under section 112(c)(9) of the CAA. Because EPA did not make this specific finding, the Petitioners claimed that not only was the delisting invalid, but CAMR was also flawed because it was based upon this delisting decision. The DC Circuit agreed with the Petitioners, vacating both the delisting rule and CAMR.

 

4. July 2008: Clean Air Interstate Rule (CAIR)

On July 11, 2008, the D.C. Circuit vacated CAIR in North Carolina v. EPA, No. 05-1244 (D.C. Cir. July 11, 2008).

The multi-party challenge to CAIR was brought by the state of North Carolina, several electric utilities (SO2 Petitioners), specific electric utilities in Texas, Florida and Minnesota, one municipality, and the Florida Association of Electric Utilities (FAEU). The electric utilities in Texas, Florida and Minnesota challenged CAIR’s applicability to them because of their location and emissions amounts. North Carolina, the SO2 Petitioners, and FAEU brought substantive challenges to the regulation, claiming that EPA did not have the discretion to act as it did, or it did so unreasonably.

The Court agreed with North Carolina and the SO2 Petitioners, holding that CAIR failed to meet the requirements of the CAA and finding “EPA’s approach – regionwide caps with no state-specific quantitative contribution determinations or emissions requirements – is fundamentally flawed.”

 Is vacatur the best remedy?

 In all four of these cases, the Court chose to vacate rather than remand the rules. The dissent in the CISWI/Boilers Rules case unsuccessfully argued that remand without vacating the rules was preferable“[b]ecause the rules would ensure greater protection to public health and the environment during the time EPA will need to develop and promulgate new rules.” The majority was unpersuaded and preferred no rules at all. Is that really the best option for the environment?

And the language the Court uses implies more than a lack of deference. In vacating CAIR, a decision described as “unexpected” by both proponents and opponents, the Court described the rule as “fundamentally flawed” and directed EPA to “redo its analysis from the ground up.” In vacating CAMR, the Court characterized EPA as “deploy[ing] the logic of the Queen of Hearts.” What’s going on here?