EPA, challengers spar over court review of cross-state rule

Posted: Jan 19, 2012

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Air pollution

In a sign of a contentious legal battle to come, U.S. EPA and industry groups challenging its new rule for limiting air pollutants that cross state lines yesterday filed briefs featuring drastically different opinions on the proper scope of the lawsuit.

Power companies, several states and some labor unions have challenged EPA's Cross-State Air Pollution Rule (CSAPR), which would set new limits on sulfur dioxide (SO2) and nitrogen oxides (NOx) emissions for states in the eastern half of the country. A federal appeals court stayed the rule before it was scheduled to go into effect on Jan. 1.

The U.S. Circuit Court of Appeals for the District of Columbia called for an accelerated hearing schedule, but the briefs indicate there are significant disagreements between the two sides on how broad the court's review of CSAPR should be.

Lawyers representing more than 40 petitioners challenging CSAPR argued the law is not "ripe" for a full review because EPA has only recently completed it.

"EPA's decisions to roll CSAPR out piecemeal and to delay action on reconsideration petitions and the correction rule have put the content of the final rule in flux," their brief says. "As a result, attempting to brief now all of the numerous issues raised by the 45 petitions to review CSAPR, as EPA proposes, would be both inefficient and unfair."

By 2014, CSAPR would require power plants to reduce their SO2 emissions by 73 percent and their NOx emissions by 54 percent from 2005 levels. It would cost the power sector about $800 million per year, according to EPA estimates.

The groups argue that EPA only finalized a supplemental rule to CSAPR at the end of December that expands CSAPR for four states and adds a fifth state, Oklahoma. Further, they said EPA's final CSAPR rule "departed" from the proposed rule "in numerous respects." And lastly, the petitioners argued that CSAPR is "remarkably complex and ambitious."

Those issues, they said, will not be resolved in time for the court's expedited April hearing schedule. Consequently, the petitioners called for the first briefings to focus on a handful of "cross cutting issues."

EPA strongly disagreed with the petitioners' recommendation.

"In EPA's view, this proposal is unworkable and inappropriate," Assistant Attorney General Ignacia Moreno wrote.

The agency argued that the delineation between which issues would be defined as overarching and which are not would not be clear-cut.

"The result is likely to be confusion as to which issues belong in which phase, and a very real possibility of inefficient and duplicative briefing," they said.

EPA also said that such an approach is "wholly inconsistent" with the court's Dec. 30 stay of the rule, which took into account the entire CSAPR program.

Lastly, EPA said the petitioners' proposal would serve to drag out the implementation of CSAPR, which would delay important health protections. EPA says the rule will result in up to $280 billion in annual health benefits, including preventing up to 34,000 premature deaths and 1.8 million sick days annually starting in 2014.

The court's initial stay required EPA to reinstate the Clean Air Interstate Rule (CAIR), a Bush-era policy that the same court struck down in 2008 for not doing enough to protect states from cross-state pollution.

"Each day that goes by is a day those benefits are not realized," Moreno wrote.

Environmental groups charged that the petitioners are seeking to delay the implementation of CSAPR, which runs contrary to their usual tactics.

"They are simply trying to drag this out as long as possible," said Frank O'Donnell, president of Clean Air Watch. "The irony is industry groups are always complaining about uncertainty and their own strategy here is to create indefinite uncertainty."

O'Donnell added that the tactic is "not a surprise" but that "we'd all like to see this resolved quickly."

But Richard Alonso of Bracewell & Giuliani, who represents power companies, said EPA's brief "ignores the complexity of the issues as well as the fact that there are current administrative reconsiderations."

Alonso said the industry proposal is fair because it calls for identifying five or six key issues that lie at the heart of CSAPR. If EPA wins on those issues, the agency would have grounds to move forward with implementation. Other challenges, he said, would likely be minor and could be dealt with in the future.

"But if they lose on those key issues," Alonso added, "EPA would probably have to start all over again."

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