Cross-state ruling emboldens EPA on power plant regs — McCarthy

Source: Jean Chemnick, E&E reporter • Posted: Wednesday, May 14, 2014

The Supreme Court ruling late last month that upheld a U.S. EPA rule curbing air pollution that crosses state lines bolstered the agency’s confidence that its upcoming greenhouse gas regulations will withstand legal challenges, U.S. EPA Administrator Gina McCarthy said today.

That ruling “is one of the biggest wins our agency has ever had,” McCarthy told the Association of Climate Change Officers meeting in Washington, D.C.”It was really big, and we have been celebrating ever since — but not too hard,” she joked.

The ruling reinstated EPA’s Cross-State Air Pollution Rule, or CSAPR, a regulatory regime for 28 Eastern states that requires upwind states in the Midwest and Appalachia to curb emissions that contribute to pollution levels in downwind states.

The high court upheld EPA’s decision to base emissions targets on a cost analysis that is not mandated by the Clean Air Act, together with the agency’s choice to supersede state authority by implementing federal plans before states were allowed to draft their own (Greenwire, April 29).

The court made clear EPA would be afforded considerable discretion in crafting its rules, McCarthy said.

“It also provided a wonderful platform and boost to the agency as we’re going into the greenhouse gas rulemaking, which is going to be challenging and requires the same kind of agency discretion,” she said.

EPA has already proposed a rule that would limit carbon dioxide emissions from future power plants, mandating that coal-fired plants use partial carbon capture and storage (CCS) technology. Industry advocates submitted their views before the public comment period on the rule closed Friday claiming that EPA failed to follow the statute’s criteria when determining that CCS should be the “best system of emissions reduction” for new coal plants. The rule’s opponents have all but promised to challenge it in court after it becomes final.

The White House is currently reviewing EPA’s proposal for existing power plant CO2. McCarthy said today that the draft would be released Monday, June 2, because the June 1 deadline set last year by President Obama fell on a Sunday.

That rule is being written under the rarely used Section 111(d) of the Clean Air Act, and competing interest groups have already made their views known about how EPA should interpret the law. Industry groups and fossil-fuel-rich states argue that the law confines the agency to the relatively modest reductions that can be achieved at individual plants, depending on the fuel source they currently use.

Environmentalists, meanwhile, advocate that EPA set emissions standards at a level that will compel states to come forward with plans that reduce emissions across the power system, through greater integration of renewable energy, demand-side energy efficiency, combined heat and power, and other measures.

The agency itself has been tight-lipped about what it plans to do.

McCarthy said today that the forthcoming proposal for existing power plants would reflect concerns raised by stakeholders, including state agencies.

“We are going to show you that we were listening,” she said. “We are going to show you that you can get significant reductions from the energy sector in a way that’s going to continue to provide reliable and cost-effective electricity, that’s going to continue our quest to address the issue of climate change, and that recognizes that we’re all in this together.”

McCarthy also touched on the administration’s strategy to reduce methane emissions that was released in March and included possible new regulations for the oil and gas sector.

“It’s another thing we’re working on,” she said. EPA released a series of white papers for external peer review in April and will make a decision on regulations by the autumn.

McCarthy said the agency’s voluntary programs, including the incentive program Gas Star, had helped to inform its regulations for the oil and gas industry by demonstrating the measures industry could take to rein in emissions.