Deseret Power — global warming case
November 18, 2008
Last week, the EPA’s Environmental Appeals Board (EAB) issued a decision in Deseret Power Electric Cooperative that could signal an increased likelihood of federal regulation of global warming in the new Administration.
The EAB is “the final Agency decisionmaker on administrative appeals under all major environmental statutes that the Agency administers.” In agency-speak, a plaintiff must typically “exhaust” all possible ways of getting a controversy with a federal agency resolved within the agency itself before suing it in federal court. The Sierra Club pursued this approach here, seeking review of the EPA’s permit that would allow Deseret to build a new coal-fired electricity generating unit at its existing power plant in Bonanza, Utah.
The Sierra Club was motivated by the Supreme Court’s decision in Massachusetts v. EPA, the global warming case involving the EPA’s refusal to regulate automobile greenhouse gas emissions under Title II of the Clean Air Act. Broadly speaking, the CAA regulates “stationary sources” (those that do not move) under Title I, and “mobile sources” (cars, trucks, etc.) under Title II. A coalition of governments and interest groups had petitioned the EPA to regulate GHGs coming from automobiles. The EPA refused, saying it did not have the authority because GHGs were not “air pollutants” regulated under Title II. The Supreme Court disagreed, holding that GHGs fall easily within the “capacious” CAA definition of “air pollutant.” It also rejected the EPA’s arguments that even if it had the authority to do so, it could avoid regulating, stating that it could deny the petition only if it could find a way to rebut the overwhelming evidence that global warming is happening.
It’s the first part of this holding that has implications for Deseret Power. The CAA’s definition of “air pollutant” covers all titles of the Act, not just Title II. So if a utility is required to get a permit for emissions of air pollutants, wouldn’t it have to control GHGs as well as traditional pollutants such as sulfur dioxide? The Sierra Club essentially argued that if CO2 is an “air pollutant” for purposes of Title II, it is for Title I as well.
Deseret Power needed a permit (in CAA-speak, a Prevention of Significant Deterioration or “PSD” permit) because its new unit was a “major modification” to the existing plant. As a permit condition, it needed to use the Best Available Control Technology (BACT) to control air pollution, and the Sierra Club wanted Deseret to adopt BACT for CO2. The question the EAB confronted is whether the PSD sections of the CAA, worded differently than Title II, require controls of CO2 emissions. Much of the lengthy decision is devoted to parsing through the EPA’s historical interpretation of the Title I language. The reason for this is that in Environmental Defense v. Duke Energy, a recent CAA case involving the air pollution program of Title I, the Supreme Court determined that even words used identically in different parts of the same statute don’t necessarily mean the same thing. So, off the EAB goes to decide exactly whether the PSD requirements bind the EPA.
The EAB remanded the case to the regional office and requested that it reconsider its decision. This leaves the status of the underlying issue unclear, of course. You can imagine the EPA’s administrative law judges thinking, “whew, we fobbed this one off until January.” But notice that they didn’t reject the Sierra Club’s argument out of hand, which gives support to the idea I’ve heard floated about that the incoming EPA will use direct regulation of GHGs under the CAA as a short-term transition to a more comprehensive regulatory regime.
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