Margaret Campbell

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Last month, the U.S. Court of Appeals for the Sixth Circuit reinstated an Environmental Protection Agency (EPA) enforcement action against DTE Energy (DTE) for violating the New Source Review (NSR) program under the Clean Air Act.  This case stems from capital projects undertaken at DTE’s Monroe Power Plant in Monroe, Michigan during a three-month scheduled outage in 2010.  DTE had characterized the projects performed during the 2010 outage as routine maintenance, repair and replacement activities, which, if accurate, would exempt them from NSR.

Consistent with past changes in presidential administrations, on President Trump’s Inauguration Day, White House Chief of Staff Reince Priebus issued a “claw back” memo describing the process of reconsidering previously finalized regulations. Similar to memos issued by President Obama and President Bush, President Trump’s claw back memo speaks to three specific groups of rules:

On January 12, 2017, EPA published a final rule adjusting for inflation the civil monetary penalty amounts for the statutes it administers. This most recent adjustment follows on the heels of a major adjustment finalized in July 2016.  These adjustments are mandated by 2015 revisions to the Federal Civil Penalties Inflation Adjustment Act.  The new law required agencies to make initial “catch-up” adjustments by July 2016, followed by annual inflation adjustments beginning January 15, 2017.  In the past, EPA only adjusted penalty levels for inflation once every several years.

On December 15, 2016, EPA issued a pre-publication version of new regional haze regulations. The Agency’s regional haze program regulates emissions affecting visibility in national parks, or “Class I” areas. EPA promulgated the regulations in 1999 with the goal of achieving natural visibility conditions by 2064. Under the program, states must create plans to control visibility-impairing emissions, and must update these plans every “planning period” of ten years.  The new regulations are intended to apply to the second planning period, but will become effective 30 days after the recently released rule is published in the Federal Register, which is scheduled for January 10th.

In the wake of Donald Trump’s election as the next president of the United States, questions have been raised regarding the fate of federal regulatory actions taken by the current administration. Recent Environmental Protection Agency (EPA) actions are of particular interest because EPA has adopted a number of very high profile and highly impactful regulations. Commenting on EPA during the campaign, Mr. Trump stated that “[w]e are going to get rid . . . of [EPA] in almost every form. We’re going to have little tidbits left but we’re going to take a tremendous amount out.” While Mr. Trump later softened this stance by stating that he would “refocus the EPA on its core mission of ensuring clean air, and clean, safe drinking water for all Americans,” these statements illustrate that the Trump administration will almost certainly seek to roll back at least some of President Obama’s ambitious environmental initiatives. While Mr. Trump vows to reduce EPA’s size and repeal business-burdening regulations, these changes will not occur overnight. The following sections discuss ways in which an incoming administration may halt or repeal its predecessor’s actions.

Yesterday, November 2, 2016, EPA released a pre-publication version of proposed regulations that spell out how the Agency’s 2015 ozone National Ambient Air Quality Standard (NAAQS) will be implemented. The proposed regulations apply to states with areas that are classified as nonattainment for the 2015 standard of 70 parts per billion (ppb), as well as to states in an Ozone Transport Region.

Recently, the Ninth Circuit upheld the Environmental Protection Agency’s (“EPA”) decision to issue an air permit under the Clean Air Act for the construction of a biomass cogeneration facility at a lumber mill, concluding that EPA had acted reasonably when it determined that the applicant should not be required to consider solar power or a greater use of natural gas as part of the Greenhouse Gas Best Available Control Technology (“GHG BACT”) review for the permit.  

EPA’s update to the Cross State Air Pollution Rule is designed to address interstate transport issues under the 2008 ozone standard. The rule establishes Federal Implementation Plans (FIPs) for 22 states in the eastern half of the U.S. (see map below) and requires ozone season NOx reductions directly from fossil fuel fired Electric Generating Units (EGUs) in those states. The rule is styled as an “update” to the Cross State Air Pollution Rule because it uses the same regulatory frameworks, with some updates, as EPA’s original Cross State Air Pollution Rule, which was finalized in 2011, vacated by the DC Circuit but ultimately upheld by the Supreme Court. Most of the states subject to the CSAPR Update rule were also subject to the original CSAPR rule with the exception of Kansas, which will be new to the ozone season NOx program under the CSAPR Update Rule. The rule establishes new, more stringent ozone season NOx emissions budgets for each state subject to the rule, and those budgets take effect in May 2017. While the rule was signed and posted on EPA’s website on September 7, 2016, the final rule was published in the Federal Register today and a copy of the Federal Register version can be found here. EPA has also separately published the unit-specific allowance allocations for the affected EGUs under the rule. The allowance allocations were issued in final form, without public review and comment, in a NODA published in the Federal Register on September 30, 2016.