Would EPA’s Defeat in Clean Power Plan Case “Overthrow” the “Structure” of the Clean Air Act?

by Marlo Lewis on April 20, 2015

in Blog

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Would a victory for the State and industry petitioners who are challenging EPA’s Clean Power Plan “overthrow” the “structure” of the Clean Air Act and punch a “gaping hole” in public protections from dangerous air pollution?

That’s what EPA and environmental intervenors contend in Murray Energy v. EPA, a case on which the D.C. Circuit Court of Appeals heard oral argument (audio files 14-1146 & 14-1112) last Thursday. They are peddling nonsense, as will be shown presently.

Moreover, if EPA and its allies were serious about either safeguarding statutory structure or ‘saving the Planet,’ the centerpiece of their agenda would be a proposal to establish national ambient air quality standards (NAAQS) for greenhouse gases, not, as in the Clean Power Plan, carbon dioxide (CO2) performance standards for existing power plants. At EPA, politics trumps both law and climate “action.”

Quick Background: Clean Power Plan, Murray v. EPA, & the 112 Exclusion

The Clean Power Plan (CPP) would establish CO2 emission-reduction targets or caps for the electric power sectors of 49 States. The targets are based on four “building block” emission-reduction strategies that include not only efficiency improvements at the source but also new dispatch policies substituting natural gas for coal generation, new mandates substituting renewable and nuclear generation for fossil-fuel generation, and new conservation incentives to reduce electricity demand. As Texas Public Policy Foundation analyst Mario Loyola observes, the CPP is a plan to reorganize “how each State regulates the production, transmission, and consumption of electricity.”

The CPP’s alleged statutory basis is §111(d) of the Clean Air Act (CAA), which authorizes EPA to promulgate emission performance standards for “existing sources.” However, as the text of §111 makes clear, performance standards apply to “particular” sources, defined as “any building, structure, facility, or installation which emits or may emit any air pollutant.” Obviously, a State’s electric power sector is not any such individual physical object. CAA §111(d) provides no authority to regulate the wider economic marketplace, networked industry, or sector of which a source happens to be a part. The Plan is unlawful on its face.

Although the Murray petitioners would no doubt agree with the foregoing, they raise a separate objection to the CPP. Simply put, the CPP runs afoul of the so-called 112 exclusion. Section 111(d) bars EPA from establishing existing source performance standards for “any air pollutant” emitted from a “source category” already regulated under the §112 hazardous air pollutant (HAP) program. Power plants have been subject to §112 regulation since December 2011, when EPA finalized Mercury Air Toxics Standards (MATS) rule. Hence, EPA’s putative statutory authority instead prohibits the agency from proposing the CPP.

EPA and its allies, of course, claim the 112 exclusion is ambiguous and only bars EPA from using §111(d) to regulate HAPs listed in §112, not source categories regulated under §112. Two previous posts rebut EPA and allied groups’ legal theory regarding the 112 exclusion.

The 112 Exclusion and the “Structure” of the CAA

Let’s now consider the claim that Murray’s reading of the 112 exclusion would “overthrow” the “structure” of the CAA, endangering public health.

EPA and its allies contend, correctly, that the 1970 CAA created a tripartite structure, with §§108-110 establishing the NAAQS program, §112 establishing the HAP program, and §111(d) providing authority to regulate air pollutants not controlled under those other sections. As EPA’s brief puts it: “Congress designed section [111(d)] to work in tandem with the NAAQS and section [112] programs such that, together, the three programs cover the full range of dangerous emissions from stationary sources.” So far, so good. But the brief then claims:

Under Murray’s reading, there would be a gaping hole in that coverage, leaving sources’ emissions of certain pollutants outside the Act’s scope. Such a result is starkly at odds with the Act’s purpose of protecting “public health and welfare.

Environmental groups warn of even more dire consequences in their brief. Murray’s reading would exempt all manner of industrial pollutants from §111(d) regulation, because “Congress intended” that “every large industrial source category” be “subject to regulation under §112 for its hazardous emissions.” Hence, “EPA would largely be deprived of its authority to regulate existing sources’ emissions of dangerous air pollutants not addressed by the NAAQS or HAP programs, such as carbon dioxide, methane, landfill gas, and total reduced sulfur.”

The 1970 CAA may have envisioned a three-legged stool. But, as environmental intervenors acknowledge, the 1990 CAA Amendments require that “every large industrial source category” be subject to regulation for its hazardous emissions. Indeed, “Congress listed 189 substances as HAPs and required EPA to list every industrial source category that emits these pollutants and to set source-specific emission standards for each of these source categories.”

EPA and its allies often claim the agency’s rules have substantial “co-benefits,” because technologies and practices designed to control emissions of pollutant X also reduce emissions of pollutant Y. Indeed, in EPA Impact Analyses of major air pollution regulations, coincidental reductions of non-targeted pollutants typically account for most of the monetized health benefits.

Are we then to suppose that the dramatic expansion in HAP regulation mandated by the 1990 CAA Amendments would have no important co-benefits in reducing emissions that might otherwise be subject to 111(d)?

Over the past 40 years, EPA has used §111(d) to regulate a total of four pollutants from five sources, including two mentioned above (total reduced sulfur, landfill gas). All those regulations were adopted between 1979 and 1996. There never was a big demand for §111(d) regulation, and none since 1996–until EPA went looking for a strategy to shut down coal power plants. The dearth of 111(d) rules since 1996 attests either to the co-benefits from the post-1990 proliferation of §112 HAP regulations, the correctness of Murray’s reading of the 112 exclusion, or both.

Note, too, the 112 exclusion does not disturb any extant 111(d) regulation, because what it prohibits is the addition of 111(d) regulation to source categories already regulated under §112, not the addition of 112 regulation to sources regulated under §111(d).

Moreover, the 112 exclusion applies only to existing, not new, facilities. A victory for Murray would not bar EPA from adopting §111(b) performance standards for new sources of landfill gas, total reduced sulfur, etc.

But what if scientists discover some new “dangerous” industrial pollutant from existing sources–would EPA have no recourse if it could not regulate the pollutant under §111(d)? No. EPA could fill the “gap” by revising (i.e. expanding) the list of substances it regulates as HAPs under §112. The definition of HAPs is rather capacious, comprehending air pollutants that:

present, or may present, through inhalation or other routes of exposure, a threat of adverse human health effects (including, but not limited to, substances which are known to be, or may reasonably be anticipated to be, carcinogenic, mutagenic, teratogenic, neurotoxic, which cause reproductive dysfunction, or which are acutely or chronically toxic) or adverse environmental effects whether through ambient concentrations, bioaccumulation, deposition, or otherwise.

Murray’s reply brief hits the nail on the head: “No party to this case has identified any pollutant that EPA has found cannot be regulated under new [post-1990] Section 112, but can be regulated under Section 111(d).”

Finally, if, for whatever reason, EPA decides it can’t regulate some hitherto undetected existing-source pollutant under §112, the States can fill the “gap.” As EPA notes in its 1975 implementing regulation for the 111(d) program (40 FR 53342): “[q]uite often health and welfare problems caused by [designated pollutants of the type intended to be covered by §111(d)] are highly localized. . .” State environmental agencies have decades of experience administering existing-source performance standards to address “highly localized” air pollution. They will be more than equal to the task of regulating the next “total reduced sulfur” (if there is one).

NAAQS: The Elephant in the Elevator

If Murray prevails, environmental intervenors argue, “EPA would largely be deprived of its authority to regulate existing sources’ emissions of dangerous air pollutants not addressed by the NAAQS or HAP programs, such as carbon dioxide, methane, landfill gas, and total reduced sulfur.” [Emphasis added]

Now, it’s quite correct that the two named greenhouse gases, CO2 and methane, are “not addressed” by the NAAQS program. But who’s fault is that? As attorney Eric Groten points out: “EPA has made CO2 an orphan solely by its decision to decline to regulate CO2 under the NAAQS program.”

In December 2009, the Center for Biological Diversity and 350.Org petitioned EPA to establish NAAQS for CO2 and other greenhouse gases. EPA has not responded in more than five years, and other major environmental groups have kept mum about the petition (unless to disparage it).

There are at least three “structural” reasons for regulating CO2 via NAAQS rather than 111(d).

First, long-lived greenhouse gases such as CO2 and methane are polar opposites of the types of pollutants §111(d) was designed to address. As noted, 111(d) pollutants have “highly localized” effects. In other words, proximity to the pollution source largely determines the associated health risks. In stark contrast, CO2 emissions have no localized effects. Whatever the impacts of CO2 emissions on global climate, or of climate change on particular communities, the potential health and welfare risks are not affected by proximity to the source.

Second, as EPA’s 1975 implementing rule also states, one reason Congress enacted §111(d) is that some pollutants are “not emitted by ‘numerous or diverse’ sources as required by section 108” (40 FR 53340). In other words, §108(a)(1)(b) limits NAAQS regulation to those pollutants whose presence in the ambient air “results from numerous or diverse mobile or stationary sources.” Carbon dioxide is emitted by both numerous and diverse mobile and stationary sources. Being the most ubiquitous byproduct of industrial civilization, CO2 fits the §108(a)(1)(b) criteria better than any substance currently subject to NAAQS regulation.

Third, if CO2 emissions are a problem, they are so only by virtue of their atmospheric concentration. Accordingly, EPA’s December 2009 greenhouse gas endangerment rule identified the “elevated concentrations of greenhouse gases in the atmosphere” as the cause of endangerment (74 FR 66516). The NAAQS program is the only component of the CAA’s triune structure that sets emission concentration standards.

In addition, although neither NAAQS for greenhouse gases nor §111(d) performance standards for power plants could do more than take tiny nibbles out of rising global CO2 emissions and concentrations, the NAAQS program could achieve larger emission cuts on account of its economy-wide reach.

Here’s the kicker. Having already made a greenhouse gas (GHG) endangerment finding under CAA §202, which obligated EPA to establish GHG emission standards for new motor vehicles, it is difficult to see what statutory basis EPA can have for declining to make a GHG endangerment finding under CAA §108, which would obligate the agency to initiate a NAAQS rulemaking. The two provisions share similar language and structure:

  • CAA §202: The Administrator “shall” establish standards for the emission of “any air pollutant” from new motor vehicles or engines which, “in his judgment, cause, or contribute to, air pollution which may reasonably be anticipated to endanger public health or welfare.”
  • CAA §108: The Administrator “shall” initiate a NAAQS rulemaking for “each air pollutant” from “numerous or diverse mobile or stationary sources” which, “in his judgment, cause or contribute to air pollution which may reasonably be anticipated to endanger public health or welfare.”

Obviously, having concluded that mobile source CO2 emissions endanger public health and welfare, it would be a glaring self-contradiction were EPA to conclude that CO2 emissions from both mobile and stationary sources pose no threat.

So why hasn’t EPA acted on the CBD/350.Org NAAQS petition? Why aren’t climate campaigners in general pushing for NAAQS regulation of greenhouse gases rather than the legal mess that is the CPP?

Politics. The blowback against a NAAQS rulemaking would be ferocious–louder and broader than opposition to the CPP. More importantly, a NAAQS rulemaking would raise fundamental questions about the Supreme Court’s conclusion, whispered in Massachusetts v. EPA (2007) and proclaimed in American Electric Power v. Connecticut (2011), that the 1970 CAA “speaks directly” to the issue of CO2 emissions and, hence, is the statutory “scheme” Congress enacted to address global climate change.

That opinion is ludicrously unhistorical. Global warming was not even a gleam in Al Gore’s eye in 1970. It would be patently absurd to claim that in 1970, Congress authorized EPA to require States to de-carbonize the U.S. economy. A NAAQS rulemaking would expose for all to see that the Massachusetts Court legislated from the bench so that EPA could legislate from the bureau.

Groten puts the point more delicately:

EPA has taken no action on this [CBD/350.Org] petition, and there is no evidence that its proponent(s) have pursued it. No doubt both sides of that transaction fear reaping the whirlwind, and perhaps even the overruling of Massachusetts v. EPA [citation omitted], insofar as embarking on a GHG NAAQS no doubt would expose the error in Justice John Paul Stevens’ assumption that “EPA jurisdiction [over GHG] would lead to no such extreme measures” as had precipitated earlier U.S. Supreme Court rulings rejecting grand agency claims of authority absent clear congressional delegation. 

I summarize my criticism of Mass. v. EPA in a previous post. I will revisit that topic in a future post, commenting on a recently ‘discovered’ 1990 EPA memorandum on greenhouse gases and the Clean Air Act that somehow escaped the attention of all parties to the case.


Frederick Colbourne April 21, 2015 at 12:05 am

The purpose of s.111(d) is to protect “health and welfare”. Of whom?

Did Congress intend to protect the health and welfare of the entire world population as the EPA now intends? Or did Congress intend to regulate those pollutants that affect the health and welfare of Americans?

Does “welfare” include the financial capacity to pursue life, liberty and happiness? If so, the cost-benefit ratio of regulations must be taken into account. However, the cost of these regulations will be borne by Americans, while the rationale for the regulations is that the whole world will benefit, including that 5% of world population who are Americans.

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