The US Supreme Court sent Environmental Protection Agency rules requiring power plants to reduce mercury and other toxic air emissions back to a lower court for reconsideration. The Supreme Court decided the closely-watched case at the end of June.
It told the lower court to consider whether EPA adequately weighed the costs to comply when choosing the path it did.
The rules, called MATS for mercury and air toxics standards, have an effect on how quickly coal-fired power plants may be retired by setting emissions limits for mercury, hydrogen chloride (a stand-in for acid gases) and filterable particulate matter (a stand-in for toxic metals). The five-to-four ruling in Michigan v. EPA reversed an appeals court decision that had upheld the MATS rule earlier.
EPA estimated the standards would cost the power industry $9.6 billion a year to comply. The court conceded that the agency took costs into account when the agency set the actual maximum achievable control technology standards for power plants, but the court said it violated the Clean Air Act by failing to consider cost when it made its initial findings that the mercury and air toxics standards are needed.
Most power plants were required to be in compliance by April this year, so the impact of the decision is expected to be limited in the broader power market. However, 170 coal-fired power plants received extensions of up to one year either to install emissions controls or to close down.
The Supreme Court held that EPA must consider cost — including cost of compliance — before deciding whether air emissions regulations are “appropriate and necessary” as directed by the Clean Air Act.
Industry groups claim that the MACT rules impose annual costs of $9.6 billion to achieve just $6 million in benefits. EPA counters that the rules will produce tens of billions of dollars largely in health benefits.
The case has been sent back to a US court of appeals for further proceedings. Because the agency already considered the cost of compliance in setting control technology standards under the rule, the decision is not expected to save non-compliant coal-fired plants from regulation in the long term.
Clean Power Plan
Another pair of EPA rules that affect the timetable for retiring coal-fired power plants are carbon dioxide emissions limits for new power plants and the “Clean Power Plan” that the Obama administration released in 2014 to reduce carbon dioxide emissions from existing or modified power plants.
A US court of appeals rejected as premature two challenges to the rules in late June. The rules are being challenged by coal companies and coal states, but not by electric utilities.
Earlier this year, EPA announced that it would delay finalizing both the rule to control carbon dioxide emissions from new power plants and its Clean Power Plan to reduce emissions from existing or modified power plants until sometime this summer. The Clean Power Plan would set unique carbon dioxide emissions rates for the power sector in each state, with state regulators developing their own plans on how best to achieve those emissions goals. The final version of the plan is currently at the White House Office of Management and Budget for review.
The petitioners in In re Murray Energy Corporation and West Virginia v. EPA, two coal companies and 12 states, argued that the court should set aside carbon emissions limits on both new and existing and modified power plants because EPA lacks authority to regulate carbon dioxide under section 111(d) of the Clean Air Act. The appeals court side stepped that question when it rejected both lawsuits as premature. The court said the issues will remain premature until EPA issues final rules in this area.
Clean Water Rule
EPA and the Army Corps of Engineers jointly released controversial new Clean Water Act regulations on May 27 aimed at restoring the federal government’s authority to limit pollution in US rivers, lakes, streams and wetlands. The US government exercises jurisdiction over “waters of the United States,” which include traditional navigable waters, their tributaries and adjacent wetlands. The regulations clarify what falls into this category.
The Clean Water Act gave the Environmental Protection Agency broad authority to limit pollution in major water bodies, as well as in streams and wetlands that drain into those larger waters. However, two US Supreme Court decisions, in 2001 and 2006, muddied the scope of federal government authority to regulate smaller streams and headwaters, as well as other water sources such as wetlands.
The new regulations refine the scope of federal authority by creating eight categories of “waters of the United States,” six of which are subject to Clean Water Act jurisdiction in all instances, and two where jurisdiction is to be determined on a case-by-case basis.
The new regulations are a significant change in the existing regulatory framework, which has frequently required case-by-case jurisdictional determinations. Now, six categories would be designated “jurisdictional by rule,” and no further analysis of their characteristics would be required to establish Clean Water Act jurisdiction. These six categories include traditional navigable waters, interstate waters, territorial seas, impoundments of jurisdictional waters, tributaries of navigable waters, and waters adjacent to navigable waters.
Two other categories will remain subject to a case-by-case analysis to determine whether they have a “significant nexus” to the other six categories where federal jurisdiction is automatic. These include waters within 100-year flood plains and certain “water features,” including prairie potholes, Carolina and Delmarva bays, pocosins, western vernal pools in California, and Texas coastal prairie wetlands. The regulations explain that these waters have a significant nexus to “waters of the United States” if they significantly affect the chemical, physical or biological integrity of traditional navigable waters, interstate waters or the territorial seas.
Since the regulations were published, more than a third of the states have sued EPA and the Army Corps of Engineers, arguing the regulations are an unconstitutional and impermissible expansion of federal power over the states.
Unless set aside, the regulations will take effect on August 28, 2015.
In an attempt to keep the greater sage-grouse off the endangered species list, the US Bureau of Land Management and the US Forest Service released 14 land management plans in May that will apply to public lands across 10 western states.
The move will limit activities, such as petroleum drilling and solar and wind development, on public lands in the West where the greater sage-grouse is found.
The US Fish and Wildlife Service must determine whether to list the greater sage-grouse as an endangered species by September 30, 2015. The deadline follows from a 2010 finding by the agency that the bird is in need of protection. There are now as few as 150,000 greater sage-grouse remaining.
The US Department of the Interior and officials in the affected states are making an effort to persuade the US Fish and Wildlife Service that a listing is unnecessary because BLM and the Forest Service are taking significant steps, through the 14 new land management plans, to preserve federally-owned sagebrush lands that serve as a habitat for the greater sage-grouse across the American West, including in California, Colorado, Idaho, Montana, Nevada, North Dakota, Oregon, South Dakota, Utah and Wyoming.
The 14 new land management plans minimize new or additional surface disturbances, improve habitat conditions, and reduce the threat of rangeland fires. The plans establish buffer zones around areas where greater sage-grouse gather for breeding, many of which abut or are inside oil and gas fields. The plans will affect approximately two million acres of mostly federal land, but would allow the exercise of existing rights for energy development, minerals, rights of way and other permitted projects.
BLM said while releasing the plans that large-scale wind and solar projects have an adverse effect on greater sage-grouse populations. The plans direct wind and solar projects to areas outside of priority greater sage-grouse habitats. With respect to transmission lines, the plans direct developers to try to avoid placing transmission lines in greater sage-grouse habitats and require mitigation when such placement is unavoidable.
Meanwhile the US Department of the Interior says that the vast majority of federal lands within the most important sage-grouse habitats have little to no potential for oil, gas, solar or wind energy development. In other priority areas, the plans would limit conventional oil and gas drilling, but could allow for horizontal drilling that would not disturb the surface.
The impact on development in the West is expected to be far greater if the greater sage-grouse is listed as endangered.
Solar Energy Zones
The US Bureau of Land Management approved the first three solar energy projects under a new streamlined permitting process for such projects in the western US in June.
The three solar projects are the Harry Allen Solar Energy Center being developed by Invenergy, a First Solar project called Playa Solar and the Dry Lake Solar Energy Center being developed by NV Energy. They have a combined capacity of 440 megawatts. The permitting for the projects was completed in less than 10 months.
The “Western Solar Plan” that is supposed to speed up permitting has been in effect since October 2012.
It applies to projects in 19 “solar energy zones” covering 298,000 acres of public land. The zones are supposed to cover areas with the highest resource potential and lowest potential for conflicts. BLM says projects in the 19 zones could produce as much as 27,000 megawatts of solar electricity.