Companies face new environmental compliance and permitting requirements

November 7, 2013

 

Companies face new environmental compliance and permitting requirements

Companies face new environmental compliance and permitting requirements

President Obama made a splash earlier this year when he announced that his administration would use its existing authority under the Clean Air Act to implement new restrictions on carbon emissions from power plants without waiting for Congress to take complementary action.

The U.S. Environmental Protection Agency (EPA) has already released a proposal for tighter restrictions on emissions from new power plants, and the agency is currently working on analogous regulations that will cover existing facilities.

Why is the EPA taking this action now?

The U.S. Supreme Court’s 2007 ruling in Massachusetts v. EPA cleared the way for the agency’s current efforts to regulate carbon emissions. Twelve states, three cities and a number of private-sector organizations had argued that the agency is legally obligated to regulate emissions of greenhouse gases (GHGs) under the Clean Air Act (CAA). The EPA, supported by a number of states and industry groups, pointed to uncertainty about the underlying science and provided a litany of reasons why it believed nonregulatory approaches to controlling GHG emissions would be more effective.

The court dismissed these arguments as impertinent to the legal questions being reviewed and found that the EPA does have the authority — though not the obligation — to make a determination that GHGs such as carbon dioxide should be considered “air pollutants … which may reasonably be anticipated to endanger public health or welfare.” In 2009, the agency made such a determination, which triggered a requirement under the CAA for it to either develop pertinent regulations or explain its reasons for not doing so.

In a press release announcing the standards for new power plants, EPA Administrator Gina McCarthy called controlling the impact of carbon emissions “one of the most significant public health challenges of our time.” She also asserted that the EPA’s proposal would “spark the innovation we need to build the next generation of power plants, helping grow a more sustainable clean energy economy.”

Although some observers had speculated that the recent government shutdown could affect the implementation of new environmental regulations, this blog recently discussed why that is unlikely to be the case. Nonetheless, the EPA will continue to face challenges regarding the extent of its authority to regulate GHG emissions.

EPA will defend new permitting rules before Supreme Court

On October 15, the Supreme Court announced that it will review the process the EPA used to justify a preconstruction review and permitting program that applies to new “major” stationary sources of “any air pollutant.”

After the agency promulgated regulations on the emission of GHGs from vehicles in 2010, officials reasoned that, under the CAA, they were required to establish a prevention of significant deterioration (PSD) program covering other sources of those substances. The specific question that will be reviewed by the court is “whether EPA permissibly determined that its regulation of greenhouse gas emissions from new motor vehicles triggered permitting requirements under the Clean Air Act for stationary sources that emit greenhouse gases.”

Columbia Law School’s Climate Law Blog noted that the court specifically declined to include the agency’s vehicle emissions standards or the underlying scientific findings in its review. Petitioners had challenged these aspects, but were granted standing to pursue only the claim about EPA’s interpretation of the CAA’s PSD provision.

“This narrow grant therefore may be read to implicitly uphold EPA’s non-PSD greenhouse gas rules and affirm EPA’s authority to address climate change through regulating greenhouse gas emissions under the CAA,” Meredith Wilensky, associate director of the Columbia Center for Climate Change Law, wrote in a blog post.

Wilensky added that although the court is not bound by the scope of the question it has chosen to review, it “has shown no inclination to address broader questions proposed by petitions.” Furthermore, as the sections of the CAA authorizing regulation of emissions from power plants are separate from the PSD permitting requirements, those regulations “do not appear to be directly affected by the court’s narrow grant.”

“While the pollution standards will likely be challenged on their own accord, it is important to emphasize that they are not part of the current issue being addressed by the Supreme Court,” Wilensky wrote.

This means facilities that would covered by the EPA’s proposed regulations will need to start planning making plans to ensure compliance with the rules. As permitting, compliance and reporting obligations continue to grow in size and complexity, companies will have a growing need to work with environmental consultants that they can depend on to provide full-cycle services addressing all pertinent regulatory and operational requirements.