Clean Air Act (CAA)

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On April 5, the U.S. Court of Appeals for the D.C. Circuit vacated a Trump-era rule that would have prevented the Environmental Protection Agency (EPA) from setting greenhouse gas (GHG) emissions standards for almost any class of stationary sources, except for fossil fuel-fired electric generating units. The court’s decision, issued at the request of the new Biden EPA, clears the way for new sector-by-sector GHG regulations should the new administration seek to set new GHG standards under Section 111 of the Clean Air Act (CAA).

On January 19, the last full day of the Trump administration, a three-judge panel of the D.C. Circuit Court of Appeals vacated the Affordable Clean Energy (ACE) rule, the Trump EPA’s replacement rule for the Clean Power Plan. The Clean Power Plan was a cornerstone of the Obama EPA’s efforts to address climate change and would have required electric utilities to shift generation from fossil fuels to renewable resources. That aggressive rule was halted by an unprecedented stay of the rule by the Supreme Court, but a decision on the merits has never been issued because the Trump administration took office and put the litigation on hold. In its January 20 opinion, the D.C. Circuit has now issued the first decision on the merits of the legal issues underlying both ACE and the Clean Power Plan.

Just before the inauguration of President Biden, the Trump administration surprised many by failing to revise the stringent CO2 standard for new coal-fired power plants. That standard, adopted by the Obama administration, is based on the use of carbon capture and sequestration — a technology only installed once in the U.S. at a facility that has now been mothballed. When the Trump administration proposed to repeal and replace that standard in 2018, the chance of it surviving in its current form seemed slim. However, as the clock ran out, the Trump EPA failed to finalize its 2018 proposal and instead issued a “significant contribution finding” that attempts to limit regulation of greenhouse gases from new sources to electric utilities alone. While likely to be reversed quickly by the Biden EPA, that determination erects one more barrier to broad regulation of greenhouse gas emissions under the Clean Air Act (Act).

The U.S. Environmental Protection Agency (EPA) has announced its decision to retain the current National Ambient Air Quality Standards (NAAQS) for fine particulate matter (PM2.5) and ozone (O3) under the Clean Air Act. However, the new Biden EPA is all but certain to reevaluate the standards and likely to reach different conclusions.

PM2.5 is a mixture of small liquid or solid particles found in the air that are less than 2.5 micrometers (μm) in aerodynamic diameter. O3 is a reactive gas that is formed through chemical reactions of nitrogen oxides and volatile organic compounds in the atmosphere. Under the CAA, EPA must ensure the ambient standards for both pollutants are established at a level “requisite to protect the public health” with “an adequate margin of safety,” and EPA must review the NAAQS every five years to determine whether the standards should be retained or revised.

The U.S. Environmental Protection Agency (EPA or Agency) issued final regulations governing cost-benefit analyses for Clean Air Act (CAA) rulemakings on December 23, 2020. The rule, titled “Increasing Consistency and Transparency in Considering Benefits and Costs in the Clean Air Act Rulemaking Process,” imposes certain requirements on the Benefit-Cost Analysis (BCA) that EPA must conduct for “significant” CAA regulations and requires EPA to consider that analysis when promulgating the regulations, unless otherwise prohibited by law. The rule seeks to force EPA to focus more on the direct benefits of a rule rather than justifying a rule based on the indirect benefits, as EPA has done with certain controversial rules in the past. However, the rule is unlikely to survive long or have much effect under the Biden administration.

On December 23, the U.S. Environmental Protection Agency (EPA) published its annual civil monetary penalty adjustments in the Federal Register. The Federal Civil Penalties Inflation Adjustment Act of 2015 requires federal agencies to make annual inflation adjustments to federal statutory civil penalty amounts. The annual inflation adjustments are based on a cost-of-living multiplier determined by changes to the Consumer Price Index. This year’s inflation multiplier is 1.01182.

On October 1, 2020, the Environmental Protection Agency (“EPA”) issued its final rule allowing for a source classified as a “major source” of hazardous air pollutants (“HAP”) under section 112(a) of the Clean Air Act to reclassify as an “area source.”  A “major source” emits or has the “potential to emit” 10 tons per year or more of a single HAP or 25 tons per year or more of a combination of HAP.  The EPA had long-followed the “once-in-always-in” policy, under which a facility that qualified as a major source of HAPs as of the “first substantive compliance date” of the applicable Maximum Achievable Control Technology (“MACT”) standard was permanently subject to that standard, even if the source was later able to reduce its emissions below major source applicability thresholds.  With the final rule, branded as the “Major MACT to Area” (“MM2A”), EPA codified the withdrawal of the “once-in-always” policy and provided the requirements that apply to major sources choosing to reclassify, including reclassification that occurs after the first substantive compliance date of an applicable MACT standard.

State strategies for regulating air emissions during periods of startup, shutdown, and malfunction (SSM) have been a controversial topic in recent years. Air emissions can be higher during periods of SSM because emitting units are not in steady-state operation and some pollution control devices cannot be operated effectively or safely during such events. Since most air emission limitations are not crafted to cover periods when emission units are not operating normally, many states have adopted regulations in their Clean Air Act-required State Implementation Plans (SIPs) to provide compliance flexibility for sources during periods of SSM. These regulations typically take the form of either automatic or discretionary exemptions for emissions that exceed otherwise applicable limitations, or affirmative defenses to liability or penalties for violations asserted by enforcement authorities or private citizens.

As of September 4, 2020, Illinois has responsibility for direct administration of the Prevention of Significant Deterioration (PSD) permitting program under state regulations, including federal Clean Air Act (CAA) requirements under authority delegated by the U.S. Environmental Protection Agency (EPA). In doing so, Illinois joins 46 other states that have elected to administer the PSD program directly.  State PSD regulations, added as Part 204 of the Illinois air quality pollution rules, 35 Ill. Adm. Code Part 204, were published in the Illinois Register on September 19, 2020.

A recent amicus curiae filing in a high-profile Michigan Clean Air Act case targets an important aspect of environmental law — citizen suit provisions — and whether they run afoul of constitutional principles. In U.S. v. DTE Energy et al.,[1] a Michigan district court is considering arguments of two law professors who question whether citizen suits invade executive powers.