A federal appeals court June 26 dismissed all challenges to the Environmental
Protection Agency's greenhouse gas regulations in an unsigned opinion that reaffirmed
the rules in their entirety (Coalition for Responsible Regulation v. EPA,
D.C. Cir., No. 09-1322, 6/26/12).
A three-judge panel with the U.S. Court of Appeals for the District of
Columbia Circuit dismissed challenges from industry groups and some states to
EPA's tailoring rule, which limits greenhouse gas permitting to the largest
The court found the petitioners lacked standing to challenge the regulation
because it was intended to ease their permitting burden by limiting the number
of sources that need to have permits. Additionally, the court denied challenges
to EPA's endangerment finding for greenhouse gases and subsequent emissions
standards for cars and light-duty trucks.
“Today's ruling is a strong validation of, in the court's own words, the
'unambiguously correct' approach we have taken in responding to the 2007 Supreme
Court decision,” EPA Administrator Lisa Jackson said in a statement.
The U.S. Supreme Court ruled in 2007 that EPA had the authority under the
Clean Air Act to regulate greenhouse gases as a pollutant (Massachusetts v.
EPA, 549 U.S. 497, 63 ERC 2057) (2007).
The D.C. Circuit heard challenges to the greenhouse gas regulations in four
separate cases during two days of oral argument Feb. 28-29 (40 DER A-20, 3/1/12;
39 DER A-29, 2/29/12).
Chief Judge David Sentelle and Judges Judith Rogers and David Tatel heard the
cases. The other three cases being decided were Coalition for Responsible
Regulation v. EPA, D.C. Cir., No. 10-1073, 6/26/12; Coalition for
Responsible Regulation v. EPA, D.C. Cir., No. 10-1092, 6/26/12; and
American Chemistry Council v. EPA, D.C. Cir., No. 10-1167, 6/26/12.
The court's decision, which upheld EPA's regulations in their entirety, was
“a resounding affirmation” of the agency's greenhouse gas program, Michael
Gerrard, director of the Center for Climate Change Law at Columbia Law School,
told BNA June 26.
Environmental groups called the decision a sweeping victory for EPA.
“These rulings clear the way for EPA to keep moving forward under the Clean
Air Act to limit carbon pollution from motor vehicles, new power plants, and
other big industrial sources,” David Doniger, senior attorney for the Climate
and Clean Air Program at the Natural Resources Defense Council, said in a
“It's hard to get an opinion that's more of a resounding victory than this
one,” Megan Ceronsky, an attorney for the Environmental Defense Fund, which
participated in the lawsuit on behalf of EPA, told BNA June 25.
Greenhouse Gas Ruling
court ruled EPA's endangerment finding for greenhouse gas emissions from
vehicles is supported by “substantial record evidence.”
also affirmed EPA's greenhouse gas emissions standards for cars and light-duty
trucks, finding the agency was obligated to issue the rule once it made the
court did not address the merits of states and industry groups' arguments
challenging the tailoring rule. Instead, the court ruled the petitioners did not
have standing to challenge the rule because it was intended to ease their
judges also upheld EPA's interpretation of the Clean Air Act requiring
facilities to obtain permits for all regulated pollutants, not just those with
national ambient air quality standards.
Attorneys for the various industry groups involved in the lawsuits said June
26 that they were still reviewing the decision and considering their
Patrick Day, a partner at Holland & Hart LLP representing the Coalition
for Responsible Regulation, told BNA industry groups are likely to either seek a
rehearing before the full D.C. Circuit or possibly file for review by the U.S.
“It seems likely to me that there will be additional proceedings undertaken,
but I don't know where or when quite yet,” he said. “It all depends on where
people end up after reading the opinion.”
Day said the Supreme Court could take the cases because the D.C. Circuit
opinion “is based in significant part in how the Circuit Court interprets the
Supreme Court's decision in Massachusetts v. EPA.”
“We disagree that Massachusetts v. EPA means what the circuit court
thinks it means,” he said.
Shannon Goessling, executive director and chief legal counsel for the
Southeastern Legal Foundation, which had challenged the rules, also said D.C.
Circuit judges were misinterpreting the Supreme Court decision in
Massachusetts v. EPA.
“We strongly disagree with the three-judge panel's interpretation of the
Supreme Court decision,” she said in a statement. “We do not believe the U.S.
Supreme Court decision restrains this court from rendering a decision on the
merits of the unprecedented EPA regulatory juggernaut. We are confident that the
record established in court and administrative proceedings over the past two
years will provide sufficient basis for reconsideration and appeal.”
Gerrard said industry groups were heavily invested in the legal challenges,
and the D.C. Circuit opinion “didn't leave too much room for them to maneuver.”
He said it is unlikely that the Supreme Court would entertain the appeals
because it has previously ruled that EPA has the Clean Air Act authority to
regulate greenhouse gases in Massachusetts v. EPA and American
Electric Power Co. v. Connecticut.
In American Electric Power, the Supreme Court held that EPA's Clean
Air Act authority to regulate greenhouse gas emissions preempts states' ability
to bring nuisance lawsuits against power plants and other sources of greenhouse
gases (American Electric Power Co. v. Connecticut, 131 S. Ct. 2527, 72
ERC 1609 (2011); 119 DER AA-1, 6/21/11, 119 DER AA-2, 6/21/11).
The Supreme Court was “very clear they thought the Clean Air Act made it
EPA's job to regulate greenhouse gases,” Gerrard said. “EPA is carrying out that
The court ruled that the petitioners challenging EPA's tailoring rule were
“far short” of demonstrating how they were harmed by the rule and thus lacked
standing to bring their lawsuits.
“Indeed, the timing and tailoring rules actually mitigate petitioners'
purported injuries,” the court said. “Without the timing rule, petitioners may
well have been subject to [prevention of significant deterioration] and Title V
for greenhouse gases before January 2, 2011. Without the tailoring rule, an even
greater number of industry and state-owned sources would be subject to PSD and
Title V, and state authorities would be overwhelmed with millions of additional
The tailoring rule limits prevention of significant deterioration and Title V
greenhouse gas permitting to new sources that emit more than 100,000 tons per
year of carbon dioxide-equivalent and modified sources that increase their
emissions by more than 75,000 tons per year (75 Fed.
Reg. 31,514; 92 DER AA-1, 5/14/10).
Clean Air Act Section 169(1) requires stationary sources with emissions
greater than 250 tons per year to obtain prevention of significant deterioration
permits. Sources with emissions greater than 100 tons per year are required to
obtain Title V operating permits.
Without the tailoring rule, EPA contends that state regulators would be
overwhelmed by the need to issue more than 6 million greenhouse gas permits,
many of them for smaller sources that have not previously been subject to
“If anything, vacature of the tailoring rule would significantly exacerbate
petitioners' injuries,” the court said.
Though the court did not address the merits of industry groups' argument for
striking down the tailoring rule, it did uphold EPA's application of its
prevention of significant deterioration program.
In the American Chemistry Council v. EPA lawsuit, several industry
groups that had not been subject to the permitting requirements prior to EPA's
decision to regulate greenhouse gases challenged the application of Section
165(a) of the Clean Air Act. The industry groups had argued that the section
only applies to pollutants with national ambient air quality standards. EPA has
not issued air quality standards for greenhouse gases.
EPA has historically interpreted that section to mean prevention of
significant deterioration permitting applies to all pollutants, not just those
subject to national ambient air quality standards.
The court upheld EPA's application of the permitting requirements, finding
that the statute's reference to “any air pollutant” refers to all air pollutants
subject to regulation not just those with applicable air quality standards.
“We thus conclude that EPA's 34-year-old interpretation of the PSD permitting
triggers is statutorily compelled: a source must obtain a permit if it emits
major amounts of any regulated pollutant and is located in an area that is in
attainment or unclassifiable for any NAAQS pollutant,” the court said.
The court also upheld EPA's 2009 determination that six greenhouse gases pose
a threat to human health and the environment and should be regulated. EPA's
decision to regulate emissions of six greenhouse gases is supported by
“substantial record evidence,” the judges said. The court also said EPA is not
required to “establish a minimum threshold of risk or harm before determining
whether an air pollutant endangers.”
The six greenhouse gases are carbon dioxide, methane, nitrous oxide,
hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride.
EPA issued the endangerment finding in 2009 (74 Fed. Reg.
66,496; 233 DER AA-1, 12/8/09).
Industry groups had argued EPA's findings were flawed and that it had relied
too heavily on outside sources such as the Intergovernmental Panel on Climate
Change rather than conducting its own analyses--arguments that the judges
“EPA simply did here what it and other decisionmakers often must do to make a
science-based judgment: it sought out and reviewed existing scientific evidence
to determine whether a particular finding was warranted,” the court said. “It
makes no difference that much of the scientific evidence in large part consisted
of 'syntheses' of individual studies and research. Even individual studies and
research papers often synthesize past work in an area and then build upon it.
This is how science works. EPA is not required to re-prove the existence of the
atom every time it approaches a scientific question.”
Petitioners had also challenged EPA's decision to regulate the six greenhouse
gases. The endangerment finding was based on emissions from vehicles, but cars
and trucks do not emit either perfluorocarbons or sulfur hexafluoride. However,
the court said none of the petitioners could demonstrate they had standing to
raise the argument. Automotive industry groups had intervened on behalf of EPA
in the lawsuits.
EPA was not obligated to consider the impact on stationary emissions sources
when it issued greenhouse gas standards for cars and trucks, the court said.
Petitioners had argued EPA should have considered the economic impact on
stationary sources because regulating vehicle emissions triggered a requirement
to issue rules for stationary facilities as well.
“This court, however, has held that the Section 202(a)(2) reference to
compliance costs encompasses only the cost to the motor-vehicle industry to come
into compliance with the new emission standards, and does not mandate
consideration of costs to other entities not directly subject to the proposed
standards,” the judges said.
After making its endangerment finding, EPA worked with the National Highway
Traffic Safety Administration to issue joint greenhouse gas emissions limits and
fuel economy standards that would require cars and light trucks to achieve 35.5
miles per gallon by model year 2016 (75 Fed. Reg.
25,324; 62 DER A-19, 4/2/10).
None of the lawsuits directly challenged the emissions limits on
The court ruled EPA was obligated by Section 202 of the Clean Air Act to
issue the vehicle standards once it had made the endangerment finding.
By Andrew Childers
The opinion by the U.S. Court of Appeals for the District of Columbia Circuit
in Coalition for Responsible Regulation v. EPA is available at http://op.bna.com/env.nsf/r?Open=fwhe-8vmmn7.