Greenhouse Gas Rules Dissected by High Court

WASHINGTON (CN) - Stationary facilities that emit greenhouse gases need not face federal permitting requirements, the Supreme Court ruled Monday.

The Environmental Protection Agency promulgated the new rules after the Supreme Court defined greenhouse gases as pollutants under the Clean Air Act in 2007 with its resolution of Massachusetts v. EPA.

That decision said: "Under the clear terms of the Clean Air Act, EPA can avoid taking further action only if it determines that greenhouse gases do not contribute to climate change or if it provides some reasonable explanation as to why it cannot or will not exercise its discretion to determine whether they do."

The EPA later determined that greenhouse gases "may reasonably be anticipated both to endanger public health and to endanger public welfare," and instituted new greenhouse gas-related rules.

In addition to a tailpipe rule that set higher standards for car and light-truck emissions, the EPA passed a number of other rules for greenhouse-gas emitters. In August 2010, for example, the EPA exempted "small-sources," or emitters of less than 250 pounds of greenhouse gases per year, from regulation.

Texas and six other states, as well as the Coalition for Responsible Regulation, the American Chemistry Council and other industry groups, challenged the EPA's new rules, but the D.C. Circuit rejected each claim in an unsigned 2012 decision.

"We conclude ... EPA's interpretation of the governing CAA provisions is unambiguously correct," the 82-page decision stated, abbreviating Clean Air Act.

The Supreme Court took up the case last year and released a complicated partial reversal Monday.

At issue are PSD provisions of the law, meaning that they relate to "Prevention of Significant Deterioration," as applied to stationary sources in certain areas.

The EPA has prohibited building or modifying a "major emitting facility" in "any area to which [the PSD program] applies" without first obtaining a permit.

Any stationary source with the poten­tial to emit 250 tons per year of "any air pollutant" qualifies as a "major emitting facility" under the Clean Air Act.

Title V of the act meanwhile "makes it unlawful to operate any 'major source,' wherever located, without a comprehensive operating permit," Justice Antonin Scalia wrote for the court.

The court found that the EPA could have excluded from the permitting triggers of PSD and Title V greenhouse gases and other pollutants that "are emitted in such vast quantities that their inclusion would radically trans­form those programs and render them unworkable as written."

"The fact that EPA's greenhouse-gas-inclusive interpre­tation of the PSD and Title V triggers would place plainly excessive demands on limited governmental resources is alone a good reason for rejecting it; but that is not the only reason," Scalia wrote. "EPA's interpretation is also unreasonable because it would bring about an enormous and transformative expansion in EPA's regulatory authority without clear congressional authorization. When an agency claims to discover in a long-extant statute an unheralded power to regulate 'a significant portion of the American economy,' we typically greet its announcement with a measure of skepticism. We expect Congress to speak clearly if it wishes to assign to an agency decisions of vast 'economic and political signifi­cance.' The power to require permits for the construction and modification of tens of thousands, and the operation of millions, of small sources nationwide falls comfortably within the class of authorizations that we have been reluctant to read into ambiguous statutory text. Moreover, in EPA's assertion of that authority, we con­front a singular situation: an agency laying claim to ex­travagant statutory power over the national economy while at the same time strenuously asserting that the authority claimed would render the statute 'unrecogniza­ble to the Congress that designed' it. Since, as we hold above, the statute does not com­pel EPA's interpretation, it would be patently unreasonable - not to say outrageous - for EPA to insist on seizing expansive power that it admits the statute is not designed to grant."

The court did, however, uphold a requirement that the EPA imposed on sources otherwise subject to BSD review. This requirement makes a permit contingent on a source's compliance with emissions limitations that reflect the "best available control technol­ogy" (or BACT) for greenhouse gases.

Justices Ruth Bader Ginsburg, Sonia Sotomayor and Elena Kagan joined a partial dissent by Justice Stephen Breyer.

"Given the purposes of the PSD program and the act as a whole, as well as the specific roles of the different parts of the statutory defini­tion, finding flexibility in 'any source' is far more sensible than the court's route of finding it in 'any air pollutant,'" Breyer wrote.

Though these justices agreed with the majority on the issue of the BACT requirement, they part ways as to "the court's hold­ing that the EPA cannot interpret the language at issue here to cover facilities that emit more than 100,000 tpy [tons per year] of greenhouse gases by virtue of those emissions."

Justice Samuel Alito meanwhile partially dissented as to the BACT issue.

"BACT analysis, like the rest of the Clean Air Act, was developed for use in regulating the emission of conven­tional pollutants and is simply not suited for use with respect to greenhouse gases," that eight-page opinion joined by Justice Clarence Thomas states.

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