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Court Dismisses Power Company Challenges To EPA's Proposed Carbon Emissions Limit

Friday, December 14, 2012

A federal appellate court Dec. 13 dismissed as premature power industry challenges to the Environmental Protection Agency's proposed carbon dioxide emissions limit for new fossil fuel-fired power plants (Las Brisas Energy Center LLC v. EPA, D.C. Cir., No. 12-1248, 12/13/12).

EPA's proposed new source performance standard for carbon dioxide emissions from fossil fuel-fired power plants is “not final agency action subject to judicial review,” the U.S. Court of Appeals for the District of Columbia Circuit said in a per curiam order granting EPA's motion to dismiss the case.

The new source performance standard proposed April 13 under Section 111 of the Clean Air Act would limit new fossil fuel-fired power plants to 1,000 pounds of carbon dioxide emissions per megawatt-hour. The proposal would not apply to existing or modified sources (77 Fed. Reg. 22,392; 43 ER 1008, 4/20/12).

Several power companies sued EPA to block the rule, arguing the proposal constitutes final agency action because it set an April 13 deadline by which new facilities must break ground or be subject to the proposed carbon dioxide limit.

Rehearing, New Hearing Options

The three judges issuing the Dec. 13 order were Judith W. Rogers, Merrick B. Garland, and Janice Rogers Brown. The power companies have the option of requesting a rehearing before the same judges or requesting a new hearing before the entire D.C. Circuit.

Eric Groten, a partner at Vinson & Elkins LLP representing White Stallion Energy Center LLC, and Jeffrey Holmstead, a partner at Bracewell & Giuliani LLP representing Tri-State Generation and Transmission Association Inc., both told BNA the power companies have made no decision on how to proceed next. EPA must finalize the performance standard by April 2013. The power companies could simply wait until then to challenge the final rule, they said.

“It wouldn't surprise me if they decided to wait until the final rule,” Groten said.

Environmental groups that had intervened on behalf of EPA praised the D.C. Circuit's decision to dismiss the lawsuits.

“This is such a clear-cut area of law,” Joanne Spalding, a managing attorney at the Sierra Club, told BNA. “The court doesn't have jurisdiction to hear challenges to proposed rules, only final action.”

David Doniger, policy director of the Natural Resources Defense Council's Climate Center, called the power companies' lawsuit “just silly.”

“This is a whacky lawsuit brought by lawyers who should know better,” he told BNA.

Allowing Challenge at Proposed Rule Stage

Both new source performance standards issued under Section 111 of the Clean Air Act and the maximum achievable control technology standards issued under Section 112 of the act require all new industrial facilities that start construction after the date the rule is proposed to comply with the emissions standards when they are finalized. Allowing petitioners to challenge the standards at the proposed rule stage would tie up EPA indefinitely, Spalding said.

“It would be endless,” she said. “EPA could never finalize anything because it could never start anything.”

By Andrew Childers  


The order granting EPA's motion to dismiss Las Brisas Energy Center LLC v. EPA is available at http://op.bna.com/env.nsf/r?Open=fwhe-92xr5k.

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