Supreme Court Decision Means D.C. Circuit Can Move Forward With Permitting Cases

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By Andrew Childers  

June 26 — Challenges to various aspects of the Environmental Protection Agency's greenhouse gas permitting requirements will return to a federal appeals court following a U.S. Supreme Court decision that limited the scope of the permitting program.

The U.S. Court of Appeals for the District of Columbia Circuit has been waiting to hear or consider rehearing challenges to other aspects of the EPA's greenhouse gas permitting programs until after the Supreme Court made its decision. The pending lawsuits include challenges to the third step of the EPA's tailoring rule as well as potential requests to rehear lawsuits over whether facilities burning biomass must obtain greenhouse gas permits or whether states must update their air pollution implementation plans to include greenhouse gases.

The Supreme Court held June 23 that greenhouse gas emissions alone can't trigger requirements for large industrial sources to obtain Clean Air Act permits for their greenhouse gas emissions. Instead, the permitting requirements are only triggered by emissions of conventional pollutants (Util. Air Regulatory Grp. v. EPA,2014 BL 172973, U.S., No. 12-1146, 6/23/14).

Tailoring Rule Challenge Likely Moot

By overturning much of the EPA's tailoring rule, the Supreme Court's decision likely renders moot an American Petroleum Institute lawsuit challenging the third step of that rule, according to sources familiar with the lawsuit.

The EPA's July 2012 third-step rule retained the existing permitting thresholds of Title V and prevention of significant deterioration emissions permits. New facilities that emit 100,000 tons per year of carbon dioxide-equivalent and existing facilities that increase their emissions by 75,000 tons per year of carbon dioxide-equivalent will be required to obtain PSD and Clean Air Act Title V operating permits (77 Fed. Reg. 41,051).

The D.C. Circuit had been holding the American Petroleum Institute's lawsuit in abeyance pending the Supreme Court's decision (Am. Petroleum Inst. v. EPA, D.C. Cir., No. 12-1376, order issued 9/4/13).

Rehearing Requests Loom

The D.C. Circuit could also entertain requests from Texas and industry groups to rehear challenges to aspects of the EPA's greenhouse gas permitting program. The court had extended the window for rehearing requests until after the Supreme Court's ruling.

Forestry groups are still considering whether to ask the full D.C. Circuit to rehear a lawsuit in a case that overturned an EPA rule that had temporarily exempted facilities burning biomass from the greenhouse gas permitting requirements (Ctr. for Biological Diversity v. EPA, 722 F.3d 401, 76 ERC 2210 (D.C. Cir. 2013).

The D.C. Circuit vacated the EPA's biomass permitting deferral rule because the agency failed to demonstrate why greenhouse gases from facilities burning biomass should be treated differently from other greenhouse gas emissions.

The American Forest & Paper Association said it is still reviewing its options in light of the Supreme Court's opinion and no decisions have yet been made.

Rehearing Possible in State Plan Lawsuits

Texas, Wyoming and the Utility Air Regulatory Group could also seek rehearing after the D.C. Circuit in 2013 dismissed lawsuits challenging a requirement that states update their air pollution implementation plans to include greenhouse gases. The court dismissed the lawsuits because the petitioners failed to demonstrate that EPA's regulation caused them any injury (Texas v. EPA, 2013 BL 198472, 726 F.3d 180 (D.C. Cir. 2013).

Texas Attorney General Greg Abbott's office and other attorneys involved in the litigation couldn't comment due to ongoing discussions about the cases.

To contact the reporter on this story: Andrew Childers in Washington at achilders@bna.com

To contact the editor responsible for this story: Larry Pearl at lpearl@bna.com