Multiple Groups Challenge EPA ACE Rule

Several environmental, governmental and utilities interests filed separate opening briefs last week (April 17, 2020) in the United States Court of Appeals for the District of Columbia Circuit (DC Circuit Court) challenging the US Environmental Protection Agency's (EPA) Affordable Clean Energy (ACE) rule. EPA issued the ACE rule on June 19, 2019 to:

1. Repeal the Clean Power Plan (CPP) that was implemented during the Obama administration
2. Establish emission guidelines for states to use when developing plans to limit carbon dioxide (CO₂) at coal-fired power plants
3. Codify regulations for EPA and state implementation of ACE and any future emission guidelines under Clean Air Act (CAA) section 111(d).

Public health and environmental groups are concerned that the rule limits pollution control standards with long-term impacts on future administrations. They maintain that EPA has completely deregulated enormous volumes of CO₂ pollution emitted by existing oil and natural gas plants. By repealing the CPP, and adopting the ACE rule, these petitioners accuse EPA of attempting to tie its own hands so that meaningful regulation of CO₂ will be expensive, difficult, or even impossible.

State and municipal petitioners, including North Carolina Attorney General Josh Stein, seek to remind EPA that greenhouse gases (GHGs) cause grave and widespread harm to public health and welfare by contributing to climate change, yet the ACE rule would reduce emissions from power plants by less than one percent when fully implemented in 2030.  These petitioners accuse EPA of relying on flawed legal interpretations to replace the CPP and making a mockery of the CAA by achieving trivial emission reductions nationally and increasing CO₂ in more than a dozen states.

Several state declarations were articulated in the brief including one from North Carolina Department of Environmental Quality (DEQ), Division of Air Quality (DAQ) Director, Mike Abraczinskas. Director Abraczinskas declared:

• Climate change impacts are threatening North Carolina
  The director cites climate data from 2009 to 2018 and a March 2020 report of the NC Institute for Climate Studies that predicts severe droughts in NC due to higher temperatures.
• NC's efforts to reduce GHG emissions
  The director's declaration calls NC a leader in the Southeast  in transitioning to a clean energy economy. The declaration points to efforts since 2002 with the state's Clean Smokestacks Act [Session Law 2002-4, SB 1078 (NC 2001)] and 2007 when NC became the first state in the Southeast to enact a renewable energy portfolio standard (REPS).
• The ACE rule imposes administrative burdens on the state while frustrating state efforts to combat climate change
  Director Abraczinskas points to previous efforts under the CPP to develop the state plan which included gathering and analyzing data from NC power producers over several months, plus preparing a fiscal note for NC's rulemaking process and responding to over 15,000 comments resulting in a hearing record report of over 13,000 pages. Under the ACE rule, NC DAQ would have to develop a state plan for submittal to EPA by July 8, 2022 and seek state rules to require power companies to submit applications to incorporate emission rates, monitoring, recordkeeping, and reporting requirements into their air permits. NC anticipates a multi-year process requiring a dedicated team of staff to manage this while the CO2 emission reductions associated with the rule are expected to be minimal compared to other options that NC is evaluating under the Governor's Executive Order 80.

The coal industry's opening brief challenges EPA's assertion that it has authority to regulate CO₂ emissions from existing coal power plants under Section 111(d). Coal petitioners say EPA has failed to make necessary threshold finding that CO₂ from coal power plants causes or contributes significantly to air pollution which may reasonably be anticipated to endanger public health or welfare. Instead, the coal industry says EPA sidestepped the issue and declared that it could proceed based on endangerment findings made in the 1970s for coal power plant emissions of other pollutants that have nothing to do with atmospheric CO₂. The coal petitioners also challenge EPA's ACE rule on the ground that coal power plants are already regulated under CAA Section 112. The coal industry brief states that Congress prohibits EPA from using Section 111(d) to regulate pollutants emitted from a source category that is regulated under section 112.