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	<title>GlobalWarming.org &#187; David Tatel</title>
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		<title>Will the Supreme Court Review EPA&#8217;s Greenhouse Gas Regulations?</title>
		<link>http://www.globalwarming.org/2013/01/04/will-the-supreme-court-review-epas-greenhouse-gas-regulations/</link>
		<comments>http://www.globalwarming.org/2013/01/04/will-the-supreme-court-review-epas-greenhouse-gas-regulations/#comments</comments>
		<pubDate>Fri, 04 Jan 2013 20:47:20 +0000</pubDate>
		<dc:creator>Marlo Lewis</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Features]]></category>
		<category><![CDATA[350.Org]]></category>
		<category><![CDATA[American Electric Power v Connecticut]]></category>
		<category><![CDATA[Brett Kavanaugh]]></category>
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		<category><![CDATA[FDA v. Brown & Williamson]]></category>
		<category><![CDATA[Janice Brown]]></category>
		<category><![CDATA[Massachusetts v. EPA]]></category>
		<category><![CDATA[Tailoring Rule]]></category>
		<category><![CDATA[Tailpipe Rule]]></category>
		<category><![CDATA[triggering rule]]></category>

		<guid isPermaLink="false">http://www.globalwarming.org/?p=15655</guid>
		<description><![CDATA[Powerful dissenting opinions can sometimes persuade a higher court to review a lower court&#8217;s ruling. Massachusetts v. EPA (2007), the Supreme Court decision empowering the EPA to act as a super legislature and &#8216;enact&#8217; climate policy, is a prime example. In 2005, the D.C. Circuit Court of Appeals held that the Bush administration EPA properly exercised its discretion when [...]]]></description>
				<content:encoded><![CDATA[<p><a class="post_image_link" href="http://www.globalwarming.org/2013/01/04/will-the-supreme-court-review-epas-greenhouse-gas-regulations/" title="Permanent link to Will the Supreme Court Review EPA&#8217;s Greenhouse Gas Regulations?"><img class="post_image alignright" src="http://www.globalwarming.org/wp-content/uploads/2013/01/Janice-Rogers-Brown1.jpg" width="253" height="320" alt="Post image for Will the Supreme Court Review EPA&#8217;s Greenhouse Gas Regulations?" /></a>
</p><p>Powerful dissenting opinions can sometimes persuade a higher court to review a lower court&#8217;s ruling. <a href="http://www.law.cornell.edu/supct/html/05-1120.ZS.html"><em>Massachusetts v. EPA</em></a> (2007), the Supreme Court decision empowering the EPA to <a href="http://www.fed-soc.org/publications/detail/epa-regulation-of-fuel-economy-congressional-intent-or-climate-coup">act as a super legislature and &#8216;enact&#8217; climate policy</a>, is a prime example.</p>
<p>In 2005, the D.C. Circuit Court of Appeals held that the Bush administration EPA properly exercised its discretion when it <a href="http://yosemite.epa.gov/opa/admpress.nsf/fb36d84bf0a1390c8525701c005e4918/694c8f3b7c16ff6085256d900065fdad!OpenDocument">denied</a> a <a href="http://209.200.74.155/doc/ghgpet2.pdf">petition</a> by eco-litigation groups to regulate greenhouse gas (GHG) emissions from new motor vehicles under <a href="http://www.law.cornell.edu/uscode/text/42/7521">§202</a> of the Clean Air Act (CAA). I remember feeling relieved but disappointed. The 2-1 majority ducked the central issue, namely, whether the CAA authorizes the EPA to regulate GHGs as climate change agents. In contrast, <a href="http://www.cadc.uscourts.gov/internet/opinions.nsf/131F165AA3EA9E328525742B0055906B/$file/03-1361a.pdf">Judge David Tatel&#8217;s dissent</a> made a strong argument that the EPA does have the power to regulate GHGs and, consequently, has a duty to determine whether GHG emissions endanger public health or welfare. Tatel&#8217;s opinion was a key factor persuading the Supreme Court to hear the case.</p>
<p>The Court in <em>Massachusetts</em> ruled in favor of petitioners, setting the stage for the EPA&#8217;s <a href="http://www.epa.gov/climatechange/EPAactivities/regulatory-initiatives.html">ongoing, ever-expanding regulation of GHG emissions</a> from both mobile and stationary sources.</p>
<p>The EPA&#8217;s greenhouse regulatory surge, however, is not yet &#8216;settled law.&#8217; Recent strong dissenting opinions by two D.C. Circuit Court of Appeals judges may persuade the Supreme Court to review one or more of the agency&#8217;s GHG rules &#8212; or even reassess its ruling in <em>Mass. v. EPA</em>.<span id="more-15655"></span></p>
<p><em><strong>Mass. v. EPA and its Aftermath: A Refresher</strong></em></p>
<p>In <em>Mass. v. EPA</em>, the Supreme Court ruled that: (1) GHGs are &#8220;air pollutants&#8221; for regulatory purposes under the CAA; (2) the EPA must determine whether GHG emissions endanger public health and welfare (unless the agency provides statutory reasons why it cannot or will not undertake such an analysis); and (3) the agency must regulate GHG emissions from new motor vehicles if it determines such emissions endanger public health or welfare.</p>
<p>The rest, as they say, is history. The EPA issued its <a href="http://www.epa.gov/climatechange/Downloads/endangerment/Federal_Register-EPA-HQ-OAR-2009-0171-Dec.15-09.pdf">endangerment determination</a> in December 2009, compelling itself to regulate GHG emissions from new cars, and in May 2010, issued its <a href="http://www.gpo.gov/fdsys/pkg/FR-2010-05-07/pdf/2010-8159.pdf">GHG tailpipe rule</a>. The EPA has long held that once <em>any</em> air pollutant from <em>any</em> source is regulated under <em>any</em> part of the CAA, major stationary sources become &#8220;subject to regulation&#8221; under the Act&#8217;s Title I Prevention of Significant Deterioration (PSD) pre-construction permitting program and Title V operating permits program. The EPA reaffirmed that interpretation in its April 2010 <a href="http://www.epa.gov/region7/air/nsr/nsrmemos/co2recon_psd.pdf">triggering rule</a>.</p>
<p>Those rules, however, threatened to create a politically-explosive <a href="http://www.globalwarming.org/2011/09/27/how-absurd-is-regulating-greenhouse-gases-through-the-clean-air-act/">administrative quagmire</a>. Literally millions of non-industrial facilities emit enough carbon dioxide (CO2) to qualify as &#8220;major&#8221; sources under the Act&#8217;s statutory definitions (250 tons per year for PSD, 100 tons per year for Title V). The EPA estimated that applying the Act&#8217;s permitting programs to GHGs under the statutory definitions of &#8220;major&#8221; source would require the EPA and its state counterparts to process an estimated 81,000 PSD permits annually (instead of 280) and 6.1 million Title V permits annually (instead of 15,000). To handle this workload, agencies would have to hire an additional 320,000 full-time employees at a cost of $21 billion per year. Otherwise, ever-growing bottlenecks and delays would paralyze environmental enforcement and economic development alike.</p>
<p>To avoid such &#8220;<a href="http://www.globalwarming.org/2011/09/27/how-absurd-is-regulating-greenhouse-gases-through-the-clean-air-act/">absurd results</a>,&#8221; the EPA in July 2010 issued a <a href="http://www.gpo.gov/fdsys/pkg/FR-2012-07-12/pdf/2012-16704.pdf">tailoring rule</a> exempting small CO2 emitters from the permitting programs. The rule decrees that for GHGs, a &#8220;major&#8221; source is one that emits 100,000 tons per year, not 100/250 tons per year, as specified for &#8220;air pollutants&#8221; in the statute. Although agencies should have some interpretative discretion when statutory language is ambiguous, there is nothing unclear about &#8220;100 tons&#8221; or &#8220;250 tons&#8221;. <em>Tailoring</em> is bureauspeak for <em>amending</em>. The irony, of which the EPA seems unaware, is that tailoring is itself an &#8220;absurd result,&#8221; because agencies have no power under the U.S. Constitution to amend statutes.</p>
<p>In 2011 a coalition of industry groups, states, and non-profits petitioned the D.C. Circuit Court of Appeals to overturn all four GHG rules: endangerment, tailpipe, triggering, and tailoring. In June 2012, a 3-judge panel decided the case, <a href="http://www.eenews.net/assets/2012/06/26/document_gw_02.pdf"><em>Coalition for Responsible Regulation v. EPA</em></a>, in favor of the agency, upholding all four GHG rules. In August, coalition members <a href="http://www.nam.org/~/media/C2DA7F19B05A4C71B56924EBAE8B789C/CRR_CADC__Pet_for_Rehrg_En_Banc_08082012.pdf">petitioned</a> for an <em>en banc </em>(full court) rehearing<em>. </em>On December 20, the court voted 5-2 to deny the petitions. However, the <a href="http://www.globalwarming.org/wp-content/uploads/2013/01/Coalition-for-Responsible-Regulation-Dec-20-2012.pdf">dissenting opinions of Judges Janice Rogers Brown and Brett Kavanaugh</a> are<em> </em>so cogently argued that the Supreme Court may decide to review the case. The Court might even reassess its ruling in <em>Mass. v. EPA</em>.</p>
<p>In a future post, I will discuss Judge Kavanaugh&#8217;s dissent. For now, let&#8217;s look at Judge Brown&#8217;s opinion.</p>
<p><em><strong>Judge Brown&#8217;s Opinion</strong></em></p>
<p>Judge Brown begins her dissent by noting that, although bound by the Supreme Court&#8217;s ruling, she is skeptical of its reasoning:</p>
<blockquote><p>Bound as I am by <em>Massachusetts</em>, I reluctantly concur with the Panel’s determination that EPA may regulate GHGs in tailpipe emissions. But I do not choose to go quietly. Because the most significant regulations of recent memory rest on the shakiest of foundations, Part I of this statement engages <em>Massachusetts</em>’s interpretive shortcomings in the hope that either Court or Congress will restore order to the CAA.</p></blockquote>
<p>Congress never intended the CAA to be an &#8220;environmental cure-all.&#8221; The Act&#8217;s actual statutory purposes are much more limited:</p>
<blockquote><p>It was targeted legislation designed to remedy a particular wrong: the harmful direct effects of poisoned air on human beings and their local environs. This is what Congress understood as &#8220;air pollution which may reasonably be anticipated to endanger public health&#8221; in the tailpipe emissions provision, <a href="http://www.law.cornell.edu/uscode/text/42/7521">42 U.S.C. § 7521(a)(1)</a>. The Supreme Court in <em>Massachusetts v. EPA</em>, 549 U.S. 497 (2007), however, concluded otherwise.</p></blockquote>
<p>Congress&#8217;s intent is visible in the very title of the statute:</p>
<blockquote><p>It was no happy accident that congressional draftsmen titled the legislation the “Clean Air Act.” Ambient air quality was the point, purpose, and focus of the CAA. Congress had set its sights on the “dirty, visible ‘smokestack’ emissions” [citation omitted].</p></blockquote>
<p>The CAA Amendments of 1990 &#8220;expanded the Act beyond its singular emphasis on urban air quality to address hazardous — i.e., toxic — air pollutants, acid rain, and stratospheric ozone,&#8221; Brown acknowledges. However, &#8220;the very particular way in which Congress handled these exceptions goes a long way toward proving the rule: Congress only expands the CAA through considered legislative acts.&#8221; Congressional intent is discernible in Congress&#8217;s consistent practice:</p>
<blockquote><p>Simply put, when Congress became aware of new dangers, it acted judiciously in crafting workable remedies that, when they obtained the necessary political support, were worked into their own discrete provisions under the Act. Neither Congress nor the EPA attempted to force these distinct problems into existing, ill-suited regulatory schemes.</p></blockquote>
<p>From which Judge Brown draws the common-sense conclusion:</p>
<blockquote><p>Where our Representatives have acted with such caution, any suggestion that Congress has — through a single word — conferred upon EPA the authority to steamroll through Congressional gridlock, upend the Senate’s rejection of the Kyoto Protocol, and regulate GHGs for the whole of American industry must necessarily fail. The legislature, recall, does not &#8220;hide elephants in mouseholes.&#8221; <em>Whitman v. Am. Trucking Assocs</em>., 531 U.S. 457, 468 (2001).</p></blockquote>
<p>Specific legislative history also argues against the cure-all interpretation of the CAA:</p>
<blockquote><p>In drafting the 1990 Amendments, Congress considered — and expressly rejected — proposals authorizing EPA to regulate GHGs under the CAA. . . . The Executive’s critique noted that “unilateral action aimed at addressing a global problem” through a standard limiting tailpipe emissions would not be an effective means of safeguarding the global environment and would “necessarily punish national interests.”</p></blockquote>
<p>Brown goes on to note that in all the years since the 1990 amendments, Congress has &#8220;never deviated from its decision not to regulate GHGs under the CAA&#8221; &#8212; and &#8220;not for lack of opportunity.&#8221; Indeed, &#8220;By one estimate, Congressmen have proposed more than 400 bills pertaining to GHGs between 1990 and 2009.&#8221;</p>
<p>None of this is to suggest, in the words of the <em>Massachusetts</em> Court, that &#8220;post-enactment congressional actions and deliberations&#8221; repeal powers previously delegated to the EPA by the CAA. The point, rather, is that more than a <a href="http://cei.org/op-eds-articles/environmental-protection-agency%E2%80%99s-end-run-around-democracy">selective and dubious reading of the CAA definition of &#8220;air pollutant&#8221;</a> is needed to establish that, in 1970, Congress did in fact delegate the truly awesome power to de-carbonize the U.S. economy to an administrative agency. Or, as Judge Brown more delicately puts it:</p>
<blockquote><p>Congress’s inability to break this nearly quarter-century long deadlock is incredibly suggestive: this is not an area of policymaking where the legislature has acted rashly or unthinkingly in delegating authority to agencies.</p></blockquote>
<p align="LEFT">Judge Brown also questions whether, per CAA §202, the EPA can actually show that &#8220;air pollution&#8221; from GHG emissions &#8221;may reasonably be anticipated to endanger public health or welfare.&#8221; It is one thing to establish a <em>nexus</em> between traditional air pollutants and the harm done to people who inhale them. It is quite another to demonstrate endangerment from GHGs, because &#8220;any harm to human health and welfare flowing from climate change comes at the end of a long speculative chain.&#8221;</p>
<p align="LEFT">The EPA had to make assumptions about future emissions, future emission concentrations, climate sensitivity, the impact of warming on weather patterns, the impact of those on agriculture and other economic activities, and, finally, the impact of those on human health and welfare. Brown worries that if the EPA can find endangerment where &#8221;there can be this much logical daylight between the pollutant and the anticipated harm, there is nothing EPA is not authorized to do.&#8221;</p>
<p align="LEFT">Next, Brown takes up the tailoring rule. She seems to suggest that the litany of absurd results arising under the PSD and Title V programs is itself reason to doubt that GHG regulation falls within &#8220;the literal meaning&#8221; of the CAA. In any event, she views the tailoring rule as a clear case of administrative overreach: &#8221;Faced with the choice of reconsidering the legitimacy of an endangerment finding that sets in motion such a cluster of chaos or rewriting the statute, the agency has blithely done the latter. This is an abuse of the absurdity and administrative necessity doctrines as neither can be invoked to preempt legislative prerogatives.&#8221;</p>
<p align="LEFT">Determining climate policy, she suggests, is above any administrative agency&#8217;s pay grade: &#8221;Congress should not be presumed to have deferred to agencies on questions of great significance more properly resolved by the legislature. If there was ever a regulation in recent memory more befitting [more guilty of?] such a presumption than the present, I confess I do not know of it.&#8221;</p>
<p align="LEFT">Next, Brown examines the relevance of <a href="http://www.law.cornell.edu/supct/html/98-1152.ZS.html"><em>FDA v.</em> <em>Brown &amp; Williamson</em></a> (1999), in which the Supreme Court struck down the FDA&#8217;s attempt to assert regulatory control beyond its statutory authority by classifying cigarettes as drug delivery devices. The Court distinguished the issues in <em>Massachusetts</em> from those in <em>Brown &amp; Williamson</em>, but Brown shows how with &#8220;only slight modifications&#8221; one could rework the text of <em>Brown &amp; Williamson</em> to apply to GHGs.</p>
<p align="LEFT">The Court argued that whereas FDA regulation of tobacco products under the Food, Drug, and Cosmetic Act (FDCA) logically entails an outright ban on the sale of cigarettes, an endangerment finding would &#8220;lead to no such extreme measures,&#8221; only a cost-constrained regulation of emissions from vehicles already regulated under §202 of the Act. &#8220;But,&#8221; observes Brown, &#8220;the Court spoke too soon.&#8221; The Court never considered whether or how motor vehicle GHG regulation would trigger regulation of stationary sources. It did not consider how regulation of GHGs as air pollutants would &#8220;radically expand the universe of covered entities far beyond Congress’s intentions.&#8221;</p>
<p align="LEFT">I would put the point as follows. Expanding the PSD and Title V programs to affect millions of non-industrial facilities &#8212; at an estimated compliance cost of up to $60,000 per facility &#8212; is the very definition of an extreme measure. Fixing the problem by amending the statute via administrative action is another extreme measure. Brown concludes: &#8220;The Supreme Court in <em>Massachusetts</em> simply did not have occasion to consider this absurd and &#8216;counterintuitive&#8217; outcome, but we do — and we must.&#8221;</p>
<p align="LEFT">Another extreme measure waiting in the wings (although not an issue in <em>Coalition for Responsible Regulation</em> and so fittingly not a topic of Judge Brown&#8217;s dissent) is GHG regulation via the national ambient air quality standards (NAAQS) program. <a href="http://www.globalwarming.org/2012/11/19/why-courts-should-repeal-epas-carbon-pollution-standard-and-why-you-should-care/">As discussed previously on this blog</a>, because the EPA finds endangerment in the &#8220;elevated concentrations&#8221; of GHGs in the atmosphere, the agency has implicitly committed itself to establish NAAQS for GHGs set below current atmospheric concentrations. Two eco-litigation groups, the <a href="http://www.biologicaldiversity.org/programs/climate_law_institute/global_warming_litigation/clean_air_act/pdfs/Petition_GHG_pollution_cap_12-2-2009.pdf">Center for Biological Diversity and 350.0rg</a>, petitioned the EPA more than three years ago to establish NAAQS for CO2 at 350 parts per million (~40 ppm below current concentrations) and for other GHGs at pre-industrial levels. Given the premises established by <em>Massachusetts</em> and the EPA&#8217;s endangerment rule, it is difficult to find fault with petitioners&#8217; reasoning.</p>
<p align="LEFT">CAA §108 requires the EPA to initiate a NAAQS rulemaking for “air pollution” from “numerous or diverse mobile or stationary sources” if such pollution “may reasonably be anticipated to endanger public health and welfare.” Carbon dioxide obviously comes from numerous <em>and</em> diverse mobile <em>and</em> stationary sources, and the EPA has already determined that the associated “air pollution” – the “elevated concentrations” of atmospheric GHGs – endangers public health and welfare.</p>
<p align="LEFT">To my knowledge, the Obama administration has addressed the NAAQS issue only once &#8212; in a brief submitted to the Supreme Court in <a href="http://www.supremecourt.gov/opinions/10pdf/10-174.pdf"><em>American Electric Power v. Connecticut</em></a> (2010). The <a href="http://www.openmarket.org/wp-content/uploads/2010/08/obama-brief-aep-v-connecticut-aug-2010.pdf">Obama Justice Department</a> described §108 as one of the provisions making the CAA a “comprehensive regulatory framework” for climate change policy.</p>
<p align="LEFT">This is worrisome because not even a worldwide depression that permanently lowers global economic output and emissions to, say, <a href="http://www.worldclimatereport.com/index.php/2006/04/10/dialing-in-your-own-climate/">1970 levels</a>, would stop CO2 concentrations from rising over the remainder of the century. Yet the CAA requires States to adopt implementation plans adequate to attain primary (health-based) NAAQS within five or at most 10 years. The level of economic sacrifice required to implement a CO2 NAAQS set at 350 parts per million would far exceed anything contemplated by the Waxman-Markey cap-and-trade bill or the Copenhagen climate treaty, which seek to stabilize CO2-equivalent GHG concentrations at 450 parts per million by 2050.</p>
<p align="LEFT">Congress did not pass the Waxman-Markey bill and the Senate did not ratify the Copenhagen treaty. They did not do so despite more than 20 years of global warming advocacy. So it would be the height of absurdity to suggest that when Congress enacted the CAA in 1970, years before global warming was even a gleam in Al Gore&#8217;s eye, Congress authorized the EPA to establish NAAQS for GHGs. Yet the &#8216;logic&#8217; of <em>Massachusetts</em> and the EPA&#8217;s endangerment rule would appear to demand the agency do just that.</p>
<p align="LEFT">How could the <em>Massachusetts</em> Court overlook the possibility that its decision would tee up the Mother of All Extreme Measures? Perhaps because petitioners gave the Court a bum steer.</p>
<p align="LEFT"><a href="http://www.americanbar.org/content/dam/aba/publishing/preview/publiced_preview_briefs_pdfs_06_07_05_1120petitioners.authcheckdam.pdf">Petitioners argued</a> that the EPA&#8217;s authority to regulate GHGs under Title II is &#8220;separate&#8221; from Title I and &#8220;entirely separate&#8221; from the EPA&#8217;s Title I authority to promulgate NAAQS. As is now evident to all, Title II regulation of GHG mobile sources triggered Title I PSD permitting requirements for major stationary sources. The EPA touts its Title II endangerment finding as the scientific basis for the <a href="http://www.gpo.gov/fdsys/pkg/FR-2012-04-13/pdf/2012-7820.pdf">proposed GHG new source performance standards</a> (NSPS) for fossil-fuel power plants under §111, also a Title I authority. Finally, as argued above, the EPA&#8217;s Title II endangerment finding creates a precedent for a §108 NAAQS rulemaking. Title I and Title II may be &#8220;separate&#8221; but they are not &#8220;entirely separate&#8221;; they are linked.</p>
<p align="LEFT">Near the conclusion of her opinion Brown writes: &#8221;Congress simply did not intend for EPA to convert the &#8216;Clean Air Act&#8217; to the &#8216;Warm Air Act&#8217; writ large. But that is exactly what the federal courts have done.&#8221; Yes, exactly. In both <em>Mass. v. EPA </em>and <em>Coalition for Responsible Regulation v. EPA</em>, federal judges facilitated and protected the EPA&#8217;s <a href="http://www.amazon.com/Climate-Coup-Warmings-Invasion-Government/dp/1935308440">climate coup</a>.</p>
<p align="LEFT">Is it reasonable then to seek redress from those very judges?</p>
<p align="LEFT">Perhaps so if the EPA&#8217;s many critics begin to hold courts responsible for agency&#8217;s greenhouse power grab and the associated damages to our economy and constitutional self-government.</p>
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		<title>U.S. Court of Appeals: Food, Fuel Groups not Injured by EPA&#8217;s Approval of E15, Hence Lack Standing to Sue &#8212; Huh?</title>
		<link>http://www.globalwarming.org/2012/08/17/u-s-court-of-appeals-food-fuel-groups-lack-standing-to-challenge-epa-approval-of-e15-huh/</link>
		<comments>http://www.globalwarming.org/2012/08/17/u-s-court-of-appeals-food-fuel-groups-lack-standing-to-challenge-epa-approval-of-e15-huh/#comments</comments>
		<pubDate>Fri, 17 Aug 2012 20:44:56 +0000</pubDate>
		<dc:creator>Marlo Lewis</dc:creator>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Features]]></category>
		<category><![CDATA[Brett Kavanaugh]]></category>
		<category><![CDATA[D.C Circuit Court of Appeals]]></category>
		<category><![CDATA[David Sentelle]]></category>
		<category><![CDATA[David Tatel]]></category>
		<category><![CDATA[e15]]></category>
		<category><![CDATA[Grocery Manufacturers Association v. EPA]]></category>

		<guid isPermaLink="false">http://www.globalwarming.org/?p=14786</guid>
		<description><![CDATA[Today, the D.C. Circuit Court of Appeals found in a 2-1 decision that automakers, petroleum refiners, and food producers lack standing to challenge the Environmental Protection Agency&#8217;s (EPA&#8217;s) approval of E15 &#8212; a blend of gasoline and 15% ethanol &#8212; for motor vehicles manufactured after 2000. Petitioners argued that the EPA acted illegally. Section 211(f) of the Clean [...]]]></description>
				<content:encoded><![CDATA[<p><a class="post_image_link" href="http://www.globalwarming.org/2012/08/17/u-s-court-of-appeals-food-fuel-groups-lack-standing-to-challenge-epa-approval-of-e15-huh/" title="Permanent link to U.S. Court of Appeals: Food, Fuel Groups not Injured by EPA&#8217;s Approval of E15, Hence Lack Standing to Sue &#8212; Huh?"><img class="post_image alignnone" src="http://www.globalwarming.org/wp-content/uploads/2012/08/Justice-Denied.png" width="160" height="137" alt="Post image for U.S. Court of Appeals: Food, Fuel Groups not Injured by EPA&#8217;s Approval of E15, Hence Lack Standing to Sue &#8212; Huh?" /></a>
</p><p>Today, the <a href="http://www.cadc.uscourts.gov/internet/opinions.nsf/227CFCE89B00F55385257A5D004E6E5D/$file/10-1380-1389715.pdf">D.C. Circuit Court of Appeals found in a 2-1 decision</a> that automakers, petroleum refiners, and food producers lack standing to challenge the Environmental Protection Agency&#8217;s (EPA&#8217;s) approval of E15 &#8212; a blend of gasoline and 15% ethanol &#8212; for motor vehicles manufactured after 2000.</p>
<p>Petitioners argued that the EPA acted illegally. <a href="http://www.law.cornell.edu/uscode/text/42/7545">Section 211(f)</a> of the Clean Air Act (CAA) prohibits the introduction of new fuels and additives into the U.S. motor fuel supply unless the manufacturer demonstrates that such fuels or additives &#8220;will not cause or contribute to a failure of any emission control device or system&#8221; of any motor vehicle, motor vehicle engine, nonroad vehicle, or nonroad engine manufactured <em>after model year 1974</em>. By the EPA&#8217;s own admission, E15 can contribute to emission failures in vehicles manufactured between 1975 and 2000. Petitioners argued that CAA 211(f) gives the EPA no authority to grant a &#8220;partial waiver&#8221; for the sale of new fuels or additives to a subset of vehicles (e.g., model years 2001 and later).</p>
<p>Chief Justice David Sentelle and Judge David Tatel held that petitioners lack standing to sue. According to Sentelle and Tatel, petitioners could not show that the EPA&#8217;s approval of E15 would likely cause a &#8216;concrete&#8217; and &#8216;imminent&#8217; injury to any automaker, refiner, or food producer.</p>
<p>I&#8217;ll grant that the automakers&#8217; asserted injury may be &#8216;speculative&#8217; or &#8216;conjectural.&#8217; However, it is hard to fathom how the EPA&#8217;s approval of E15 would not impose substantial costs on both petroleum refiners and food producers. The switch from E10 to E15 means a 50% increase in the quantity of ethanol blended into the nation&#8217;s motor fuel supply, potentially increasing ethanol sales from 14 billion gallons a year to 21 billion gallons. Since nearly all U.S. ethanol today comes from corn, the switch to E15 could substantially increase demand for corn, corn prices, and the quantity of corn diverted from feed and food production to motor fuel production.</p>
<p>Sentelle and Tatal argued that refiners and food producers are not injured because the EPA is merely giving refiners the &#8216;option&#8217; to blend and sell E15, not forcing them to do so. But this is a distinction without a difference. As the justices acknowledge, the Renewable Fuel Standard (RFS) will soon require refiners to sell more ethanol than can be blended as E10. Thus, if the EPA waiver is upheld, refiners will have no real choice but to blend and sell E15, and this will impose substantial, predictable costs on both refiners and food producers. Their injury is concrete and imminent. The Court, therefore, should have reviewed the case on the merits and struck down the waiver as exceeding the EPA&#8217;s authority under CAA Section 211.</p>
<p>Judge Brett Kavanaugh&#8217;s dissent is so powerful and convincing that I will be surprised if the case is not appealed and overturned. Excerpts from Kavanaugh&#8217;s dissent follow.  <span id="more-14786"></span></p>
<p><span style="color: #000080">KAVANAUGH, Circuit Judge, dissenting: </span></p>
<p><span style="color: #000080">In order to issue the waiver under the statute, EPA had to find that E15 would not cause any car models made after 1974 to fail to meet emissions standards. EPA found that E15 could cause emissions failures in some cars made after 1974 (namely, in cars made between 1975 and 2000). Nonetheless, EPA still granted the waiver. For the first time ever, EPA granted what it termed a “partial waiver,” meaning that the waiver allowed E15 use only in cars made after 2000. </span></p>
<p><span style="color: #000080">In this suit, members of the food industry and the petroleum industry contend that EPA’s E15 waiver is illegal. The food group is suing because, as a result of EPA’s E15 waiver, ethanol production will increase and demand for corn (a necessary raw material for ethanol) will rise significantly. In turn, corn prices will rise. Therefore, food producers, which compete directly with ethanol producers in the upstream market for purchasing corn, will have to pay more for corn. The petroleum group is suing because, as a result of EPA’s E15 waiver and the statutory renewable fuel mandate, those in the petroleum industry now must refine, sell, transport, and store E15, incurring significant costs to do so. </span></p>
<p><span style="color: #000080">Despite the fact that two enormous American industries will be palpably and negatively affected by EPA’s allegedly illegal E15 waiver, the majority opinion tosses the case for lack of standing. </span></p>
<p><span style="color: #000080">The food group includes producers of processed food made with corn and those who raise livestock fed with corn. It is hard to overestimate the significance of corn to the American food industry. And petitioners’ submissions to EPA and this Court reveal the following about the effects of EPA’s E15 waiver on the food industry: In E10, up to 10% of gasoline is made up of ethanol. In E15, up to 15% of gasoline is made up of ethanol. That’s a 50% increase in the amount of ethanol used. In hard numbers, with only E10 on the trade market, 14 billion gallons of ethanol could be produced each year for the Nation’s gasoline supply. With E15 on the market, 21 billion gallons of ethanol can be produced each year. That’s an additional 7 billion gallons of ethanol annually produced for use in the U.S. gasoline supply. As a result of the E15 waiver, there is likely – indeed, nearly certain in the current market – to be a significant increase in demand for corn to produce ethanol. The extra demand means that corn producers can charge a higher price. Therefore, the E15 waiver will likely cause higher corn prices, and members of the food group that depend on corn will be injured.</span></p>
<p><span style="color: #000080">This is Economics 101 and requires no elaborate chain of reasoning. It is no surprise that EPA – which is typically quite aggressive in asserting standing objections in lawsuits against it – has not contested the food group’s standing in this case. </span></p>
<p><span style="color: #000080">When an agency illegally regulates an entity’s competitor in a way that harms the entity – for example, by loosening regulation of the competitor – we have said that the entity has Article III standing to challenge the allegedly illegal regulation. . . .Here, EPA’s E15 waiver loosens a prohibition on gasoline and ethanol producers and thereby harms entities such as the food group that directly compete with gasoline and ethanol producers in the upstream market for purchase of corn. </span></p>
<p><span style="color: #000080">To show causation, the petroleum group must demonstrate a “substantial probability” that the E15 will cause at least one of its members to incur higher costs. Sierra Club v. EPA, 292 F.3d 895, 899 (D.C. Cir. 2002). To be sure, the E15 waiver alone does not require the petroleum group to use E15, make changes, and incur costs. But we cannot consider the E15 waiver in some kind of isolation chamber. The Energy Independence and Security Act imposes a renewable fuel mandate that requires a certain amount of renewable fuel to be introduced into the market every year. Pursuant to that law, an increasing amount of renewable fuel such as ethanol – rising to 36 billion gallons in 2022 – must be introduced into the market. 42 U.S.C. § 7545(o)(2)(B)(i)(I). EPA regulations identify petroleum refiners and importers who produce gasoline as “obligated” parties – they are responsible for introducing a percentage of the required amount into the market each year. 40 C.F.R. § 80.1406; see also 40 C.F.R. §§ 80.1407, 80.1427. </span></p>
<p><span style="color: #000080">Before the E15 waiver, however, petroleum producers likely could not meet the requirement set by the statutory renewable fuel mandate. Now that EPA has allowed E15 onto the market, producers likely can meet the renewable fuel mandate – but they must produce E15 in order to do so. So the combination of the renewable fuel mandate and the E15 waiver will force gasoline producers to produce E15. In tort law, when two acts combine to create an injury, both acts are considered causes of the injury. So it is here. In the current market, there is at least a “substantial probability” that, in the wake of the E15 waiver, gasoline producers will have to use E15 in order to meet the renewable fuel mandate. And that’s all that the petroleum group needs to show to carry its burden on the causation issue. . . .On those facts, the petroleum group’s injury is not self-imposed, but is directly caused by the agency action under review in this case. For those reasons, the petroleum group has Article III standing to challenge the E15 waiver provision. </span></p>
<p><span style="color: #000080">The majority opinion concludes otherwise. But the fundamental flaw in the majority opinion’s reasoning is its belief that petroleum producers could meet the renewable fuel mandate without using E15. In the current market, the majority opinion’s assumption is simply incorrect as a matter of fact. One way to answer the causation question in this case is to ask the following: In the real world, does the petroleum industry have a realistic choice not to use E15 and still meet the statutory renewable fuel mandate? The answer is no, and  intervenor Growth Energy’s claim to the contrary seems rooted in fantasy.</span></p>
<p><span style="color: #000080">Having found that there is standing, I turn to the merits of this case. The merits are not close. In granting the E15 partial waiver, EPA ran roughshod over the relevant statutory limits. </span></p>
<p><span style="color: #000080">Section 211(f)(1) of the Clean Air Act prohibits manufacturers of fuel or fuel additives from introducing new fuels or fuel additives into commerce for use in car models made after 1974, unless the new fuel or fuel additive is “substantially similar” to certain fuels or fuel additives already in use. 42 U.S.C. § 7545(f)(1)(B). All agree that E15 is not substantially similar to fuels already in use. But Section 211(f)(4) allows EPA to waive that prohibition if EPA “determines that the applicant has established that such fuel or fuel additive or a specified concentration thereof, and the emission products of such fuel or fuel additive or specified concentration thereof, will not cause or contribute to a failure of any emission control device or system (over the useful life of the motor vehicle, motor vehicle engine, nonroad engine or nonroad vehicle in which such device or system is used) to achieve compliance by the vehicle or engine with the emission standards with respect to which it has been certified.” 42 U.S.C. § 7545(f)(4) (emphasis added). Put in plain English, in order to approve a waiver, EPA must find that the proposed new fuel will not cause any car model made after 1974 to fail emissions standards. </span></p>
<p><span style="color: #000080">Here, EPA issued a waiver for E15 even though it acknowledged that E15 likely would contribute to the failure of some cars made after 1974 (namely, those made between 1975 and 2000) to achieve compliance with emissions standards. EPA maintains that E15 will not contribute to the failure of emissions control systems in cars built in 2001 and later. But EPA concedes that E15 likely will contribute to the failure of emissions control systems in some cars built before 2001. EPA’s E15 waiver thus plainly runs afoul of the statutory text. EPA’s disregard of the statutory text is open and notorious – and not much more needs to be said. </span></p>
<p><span style="color: #000080">EPA does throw out a few arguments to try to get around the text of the statute. None is persuasive. </span></p>
<p><span style="color: #000080">First, EPA tries to weave ambiguity out of clarity in the statutory text. EPA contends that the statute does not expressly address partial waivers. But as petitioners aptly  respond in their brief, to suggest “‘that Chevron step two is implicated any time a statute does not expressly negate the existence of a claimed administrative power (i.e., when the statute is not written in ‘thou shalt not’ terms), is both flatly unfaithful to the principles of administrative law, and refuted by precedent.’” Petitioners’ Reply Br. 8-9 (quoting API v. EPA, 52 F.3d 1113, 1120 (D.C. Cir. 1995)). There is no plausible way to read this statute as allowing partial waivers of the kind granted by EPA here. </span></p>
<p><span style="color: #000080">EPA also suggests that a plain text reading of the statute would be absurd – “[c]learly Congress did not mean to require testing of every vehicle or engine.” EPA Br. 23. But that argument confuses methods with standards. As to methods, the statute may allow EPA to test a reasonable sample of vehicles and extrapolate from those results to conclude that a new fuel will not cause any vehicles to fail their emissions tests. But the standard remains that a new fuel cannot cause any vehicles to fail their emissions tests. Just because EPA can restrict its testing to a reasonable sample does not mean that EPA can restrict its waivers to a subset. </span></p>
<p><span style="color: #000080">If Congress wanted to authorize this kind of partial waiver, it could easily have said so (and going forward, could still easily do so). After all, the statute elsewhere allows EPA to partially waive other statutory requirements. </span></p>
<p><span style="color: #000080">The food group petitioners and the petroleum group petitioners each independently have standing to challenge EPA’s E15 waiver. On the merits, EPA’s E15 waiver is flatly contrary to the plain text of the statute. I would grant the petition for review and vacate EPA’s E15 waiver decision. I respectfully dissent.</span></p>
<p><span style="color: #000080"> </span></p>
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