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U.S. Supreme Court Upholds Cross-State Air Pollution Rule

05.08.2014

By Kate E. Beatty, Attorney, Bingham Greenebaum Doll 

On April 29, 2014, the U. S. Supreme Court, in a 6-2 ruling, reversed an August 2012 ruling by the U.S. Court of Appeals for the D.C. Circuit, reinstating the Cross-State Air Pollution Rule (CSAPR or the Transport Rule). 

The Transport Rule was developed to replace EPA’s 2005 Clean Air Interstate Rule (CAIR) in response to a 2008 court decision that found CAIR to be flawed.  The Transport Rule, finalized in July 2011, requires 28 states in the eastern half of the United States, including Indiana and Kentucky, to reduce annual sulfur dioxide (SO2) emissions, annual nitrogen oxide (NOX) emissions and/or seasonal NOX emissions to assist in attaining the 1997 ozone and fine particle and 2006 fine particle National Ambient Air Quality Standards (NAAQS). The Transport Rule also requires a reduction of emissions from power plants, among other sources, that cross state lines and contribute to ground-level ozone and fine particle pollution in other states. EPA promulgated Federal Implementation Plans (FIPs) for each of the states covered by the rule to assure emissions reductions.  

In August 2012, the U.S. Court of Appeals for the D.C. Circuit invalidated the Transport Rule for two main reasons: (1) the Transport Rule could require upwind states to reduce emissions by more than their own significant contributions to a downwind state’s nonattainment; and (2) EPA did not provide states with the opportunity to implement the required emission reductions. 

The U.S. Supreme Court granted certiorari “to decide whether the D.C. Circuit had accurately construed the limits that the [Clean Air Act] places on EPA’s authority.” The majority opinion in EPA v. EME Homer City Generation, L.P., Case Nos. 12-1182 and 12-1183, was written by Justice Ruth Bader Ginsburg and held that “the [Clean Air Act] does not command that States be given a second opportunity to file a [State Implementation Plan] after EPA has quantified the State’s interstate pollution obligations.” The Court further concluded that the Clean Air Act Good Neighbor Provision “does not require EPA to disregard costs and consider exclusively each upwind State’s physically proportionate responsibility for each downwind air quality problem” and that “EPA’s cost-effective allocation of emissions reductions among upwind States”…“is a permissible, workable, and equitable interpretation of the Good Neighbor Provision.” 

Justice Antonin Scalia, writing for the dissent and joined by Justice Clarence Thomas, summarized the majority’s holding as “approv[ing] the undemocratic revision of the Clean Air Act.” Justice Scalia agreed with the D.C. Circuit that EPA violated the law in both the “crafting” and “implementation” of the Transport Rule. Furthermore, he agreed that EPA should have given states a chance to address their contributions to interstate pollution before imposing FIPs. 

In light of this decision, CSAPR may now be revived in lieu of CAIR. However, CAIR remains in effect until further review by the Court of Appeals on remand. EPA advises that “no immediate action from States or affected sources is expected.” Additionally, litigation concerning multiple aspects of CSAPR implementation which was put on hold pending a decision, may now resume. It is expected that EPA also will revise the implementation dates of CSAPR which lapsed due to litigation of the rule.


To view a complete PDF of the First Quarter 2014 Air Quality Letter, click here.

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