Tuesday, August 21, 2012

Federal court strikes down EPA cross-state air limits

Updated at 11:45 p.m. to add additional stories
reported Tuesday morning:

A federal court on Tuesday vacated an Environmental Protection Agency's rule that set strict limits on sulfur dioxide and nitrogen oxide emissions - pollutants that cause acid rain and smog - in 28 mostly Eastern states and Texas.

The U.S. Court of Appeals for the D.C. Circuit sent the rule back to the agency for revision and told it to administer its existing Clean Air Interstate Rule in the interim.

The rule was designed to reduce sulfur dioxide emissions by 73 percent and nitrogen oxide by 54 percent at coal-fired power plants from 2005 levels, according to the EPA.

U.S. natural gas futures dropped more than 10 cents after the ruling was announced as traders bet it would mean less demand for the cleaner fuel over the coming months.

The EPA and environmental groups contended that the rule would improve air quality for 240 million people across the Eastern United States.

The EPA's rule aimed to control emissions from sulfur dioxide and nitrogen oxide -- pollutants that cause acid rain and smog -- from power plants in 28 mostly Eastern states. The reasoning is that unhealthy emissions from those plants cross state lines.

The rule, known as CSAPR, also established a cap-and-trade system that enabled power producers to comply with the emission limits by buying, trading and selling pollution permits.

Power generators, such as Southern Co and Energy Future Holdings Corp, had argued that the Jan. 1 implementation date was too soon and allowed too little time to design and install pollution control equipment needed to comply.

The state of Texas, along with the National Mining Association and the International Brotherhood of Electrical Workers, also challenged the EPA. They said the rule caused undue financial burden on power producers and could make the power market less reliable by forcing companies to shut some older plants.

The Associated Press reported
WASHINGTON - A divided federal appeals court Tuesday overturned a regulation clamping down on power plant pollution that contributes to unhealthy air in neighboring states.

In a 2-1 decision, a panel of the U.S. Court of Appeals for the District of Columbia Circuit said the Environmental Protection Agency's cross-state air pollution rule exceeded the agency's statutory authority. The court faulted the EPA for imposing "massive emissions reduction requirements" on upwind states without regard to limits imposed by law.

In adopting the regulation a year ago, the EPA sought to reduce downwind pollution from power plants in more than two-dozen states. The rule was scheduled to go into effect in January, but several large power companies and some states sued to stop it. The appeals court agreed last December to suspend the rule pending its review.

"Our decision today should not be interpreted as a comment on the wisdom or policy merits of" the EPA rule, wrote Judge Brett Kavanaugh, in a decision joined by Judge Thomas Griffith , both appointees of Republican President George W. Bush. "It is not our job to set environmental policy. Our limited but important role is to independently ensure that the agency stays within the boundaries Congress has set. EPA did not do so here."

In a dissent, Judge Judith Rogers, an appointee of Democratic President Bill Clinton, said that the court had disregarded "limits Congress placed on its jurisdiction, the plain text of the Clean Air Act, and this court's settled precedent interpreting the same statutory provisions at issue today. Any one of these obstacles should have given the court pause; none did."

Sulfur dioxide and nitrogen oxide pollution from power plants can be carried long distances and the pollutants react with other substances to form smog and soot, which have been linked to illnesses. The cross-border pollution has prevented many cities from complying with health-based standards set by law.

EPA spokeswoman Alisha Johnson said the agency is reviewing the decision, and will determine what steps to take after the review is complete.

"EPA remains committed to working with states and the power sector to address pollution transport issues as required by the Clean Air Act," she said. 

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