Posted on July 10, 2014 by Michael R. Barr
Last Monday June 23, it was the Supreme Court’s turn in the UARG case to decide whether EPA could “tailor” its climate policy to fit the PSD and operating permit programs in the current Clean Air Act. Both the Court and EPA faced the issue without any precise guidance from the missing branch: Congress.
As a result, yet another court – the DC Circuit – must next consider the proper remedy in the UARG case and, if past DC Circuit decisions are a sound guide, remand the matter back to EPA to take action consistent with the courts’ decisions. The DC Circuit will almost certainly not tell EPA what it can do, nor should it tell EPA how to exercise its remaining substantial discretion. The courts are only telling EPA what it cannot do in certain respects. Thus, the courts’ guidance to EPA is limited.
EPA will retain considerable discretion when it tries again to regulate GHG emissions from major stationary sources and major stationary source modifications under titles 1 and 5 of the Clean Air Act. EPA has loads of options, as many commenters pointed out during the prior EPA rulemaking. The options may fit the current Clean Air Act to varying degrees. In the words of the Supreme Court in the June 23 UARG decision, though, “Even under Chevron’s deferential framework, agencies must operate ‘within the bounds of reasonable interpretation.’” (J. Scalia for the Court, slip opinion at p. 16)
EPA may try to avoid options that would be most vulnerable to challenge under the principles expressed by the Court in the UARG opinion. One Court majority held that EPA lacked authority to “tailor” the Act’s numerical thresholds governing the PSD and operating permit programs. A different Court majority upheld EPA’s BACT rules for GHGs. Some commenters will undoubtedly urge EPA to continue its drive towards regulating GHGs under titles 1 and 5 of the current Clean Air Act. But, EPA should re-solicit the broadest public comment and carefully consider all options, as the Supreme Court requires under the Chevron standard of judicial review. After all, there will be a national election in 2016 and there will be a new Administration with its own views on the options. If the current Administration wishes to leave a lasting legacy in this area, it would be well advised to act on the basis of the most solid record and adopt moderate, fully vetted polices that can survive. As retiring Congressman John Dingell recently said in a farewell speech held by the National Press Club in Washington, D.C., “Compromise is an honorable word.”
Congress is very unlikely to provide any additional guidance in this area any time soon, though. The nation will miss some basic policy decisions and compromises, such as:
• Should the PSD and operating permit programs apply to GHGs? How?
• Which sources should be covered? When? With a phase-in? Tied to what?
• In the PSD program, can and should BACT work the same way for GHGs as for criteria pollutants?
• In the operating permit program, when should sources have to add GHG provisions (since there aren’t yet any substantive requirements for the operating permits to pick up)?
• What substantive requirement should EPA develop and for which sources? When? E.g., should EPA set GHG emissions standards or other requirements for power plants and other source categories under section 111(d) of the Act, as EPA recently proposed?
• What role(s) should state and local agencies and programs play?
In the 1990 Clean Air Act amendments, Congress resolved issues like these in the Act itself. The leading precedent is title 4 – acid rain – where Congress even allocated emissions of SO2 by individual numbered electric power generators in named powerplants in named states. Both houses and both parties held hands and made this deal under the Capitol dome – a deal which has resulted in a stunning and stable policy success. The acid rain deal largely avoided the dilemmas that EPA and the courts now face in dealing with stationary source permitting under titles 1 and 5 of the Clean Air Act. It seems most likely that whatever EPA does next under the current Clean Air Act will be challenged vigorously in court – again and again – until Congress can once again come together under the dome.