EPA Defends Cross-State Pollution Rule As Response to Remand of Earlier Rule

By Andrew Childers  

The Cross-State Air Pollution Rule is a direct response to a federal appellate court decision striking down a prior interstate emissions trading program, the Environmental Protection Agency said in a court filing March 1 (EME Homer City Generation LP v. EPA, D.C. Cir., No. 11-1302, brief filed 3/1/12).

The cross-state rule complies with an order by the U.S. Court of Appeals for the District of Columbia Circuit that EPA rebuild its remanded Clean Air Interstate Rule “from the ‘ground up,' ” the agency said in a brief defending its program for curtailing interstate air pollution.

EPA defended its approach in the rule for reducing ozone and fine particle pollution and assigning state-by-state emissions caps to prevent the interstate transport of pollution in a way that was cost-effective.

“The transport rule represents the culmination of decades of congressional, administrative, and judicial efforts to fashion a workable, comprehensive regulatory approach to interstate air pollution issues that have huge public health implications,” EPA said in its brief.

Final Rule Issued in August 2011

EPA issued the final cross-state rule in August 2011, requiring power plants in 28 states to reduce nitrogen oxides and sulfur dioxide emissions that cross state lines. The rule is intended to help downwind states meet national ambient air quality standards for ozone and fine particulate matter (Link76 Fed. Reg. 48,208; 131 DEN A-6, 7/8/11).

Industry, labor groups, and some states are challenging the rule, arguing it should have been implemented through state air plans rather than federal plans, failed to account for states' actual emissions, and is more stringent than necessary for downwind states to achieve or maintain air quality standards (28 DEN A-8, 2/13/12).

The rule was set to take effect Jan. 1, 2012, but the D.C. Circuit on Dec. 30, 2011, stayed the rule while it hears the challenges.

Interstate Rule Remanded in 2008

EPA said its approach to the cross-state rule was driven by the D.C. Circuit's decision in 2008 to remand the Clean Air Interstate Rule (CAIR), which would have established an interstate emissions trading program for power plants (North Carolina v. EPA, 531 F.3d 896, 67 ERC 1151 (D.C. Cir. 2008); 247 DEN A-2, 12/24/08).

The court remanded the interstate rule in part because it did not adequately ensure that upwind emissions reductions would be sufficient to help downwind states meet air quality standards.

EPA said its cross-state rule was developed “using a more state-specific, rather than regional, analysis” that should ensure the emissions reductions help downwind states achieve the air quality standards for ozone and particulate matter. The interstate rule had taken a more regional approach when it analyzed contribution to downwind pollution problems.

Challengers have argued that the cross-state rule incorrectly calculates each state's contribution to downwind pollution. However, EPA said states and industry groups did not offer viable alternatives to its contribution determinations during the public comment period on the rule.

“No commenter proposed an alternative, comprehensive air quality-based methodology that would be workable and effective in practice,” EPA said.

Federal Plans Required by Statute

In its brief, EPA also defended its authority to issued federal implementation plans (FIPs) for the cross-state rule. EPA said it was obligated under the Clean Air Act to issue findings that the 28 subject states had failed to submit state implementation plans (SIPs) to address interstate pollution and subsequently issue federal plans.

Petitioners have argued EPA should have given states additional time to revise their implementation plans to bring them into compliance with the cross-state rule.

“However, the act has obligated states to adopt SIP provisions to address interstate air pollution since the 1970s, and it has been clear since North Carolina that neither the CAIR FIPs, which were remanded to EPA yet remain in place in several States, nor SIP provisions that merely implemented the requirements of CAIR, satisfied this long-unsatisfied obligation,” EPA said in the brief.

EPA said the federal plans were necessary because the court had ruled in North Carolina v. EPA that the state implementation plans the agency approved under the Clean Air Interstate Rule were insufficient to reduce interstate pollution.

EPA Defends Modeling

EPA also defended the use of its Integrated Planning Model to establish state-level emissions budgets.

Industry groups had argued the economic model used by EPA to forecast power plant electricity production does not accurately reflect actual emissions.

EPA said the model is widely used by private industry to forecast power plant generation and emissions and has been used “in prior transport-related rulemakings and recognized by this court as a reasonable tool for these purposes.”

For More Information

EPA's reply brief in EME Homer City Generation LP v. EPAis available at http://op.bna.com/env.nsf/r?Open=smiy-8rznsa.