CSAPR to Take Effect January 1st

Though still in flux, the Cross State Air Pollution Rule is going into effect on January 1, 2012. This post provides a brief discussion of the rule’s history, its expansion, the status of proposed modifications to state emission budgets, and an update on the main legal challenge to the rule.

Background

On May 12, 2005, the EPA issued the Clean Air Interstate Rule (CAIR), and on April 26, 2006, the EPA issued CAIR federal implementation plans (FIPs); these rules aimed to address the interstate transport of pollutants that contributed significantly to downwind nonattainment of the PM 2.5 and 8-hour ozone National Ambient Air Quality Standards (NAAQS) established in July 1997.

In July 2008, the D.C. Circuit Court vacated CAIR and the CAIR FIPs. In December 2008, the Court remanded these rules without vacating them, keeping them in place temporarily while the EPA promulgated new rules. The Cross State Air Pollution Rule (CSAPR) replaces CAIR, utilizing approaches consistent with the Court’s opinion.

Under CSAPR, 28 states, including Wisconsin, are required to reduce annual nitrogen oxides (NOx) emissions, annual sulfur dioxide (SO2) emissions, summertime nitrogen oxides emissions, or some combination.

For each of these states, the EPA is establishing an emissions “budget” and promulgating a federal implementation plan (FIP) that ensures the budget is achieved through a cap-and-trade program applicable to fossil fuel-fired power plants.

Expansion

At the same time it released the final Cross-State Air Pollution Rule rule, the EPA also issued a supplemental notice of proposed rulemaking that would require six states — Iowa, Kansas, Michigan, Missouri, Oklahoma, and Wisconsin — to make summertime NOX reductions under the CSAPR ozone-season control program.

The EPA has now issued its final rule to expand the number of states covered by CSAPR.

The EPA had proposed requiring Kansas to reduce summertime nitrogen oxides emissions, but the state was excluded from the final rule because the EPA does not have the authority to finalize a federal implementation plan for Kansas. The EPA previously approved a state implementation plan (SIP) for Kansas that addresses interstate transport of ozone and fine particulate matter, and that plan did not rely on the 2005 Clean Air Interstate Rule (CAIR), so it is still valid. The EPA now intends to address Kansas's emissions in a separate rulemaking.

Emission Budget Modifications

The final rule expanding the Cross State Air Pollution Rule is distinct from a separate package of “technical amendments” to CSAPR, which would alter the originally proposed emission budgets for Wisconsin and other states. Those technical amendments are still pending review at the White House Office of Management and Budget (OMB).

Legal Challenges

Despite its January 1st start date, CSAPR is still facing challenges in courts. Business and consumer groups have argued that the rule treats Wisconsin energy customers unfairly by requiring disproportionately deeper reductions by Wisconsin power plants than those required in many other states. A broad-based, bipartisan coalition of groups including power companies, cities, states, industry groups and labor organizations has emerged to challenge the rule in court because of what they have deemed to be an unrealistic compliance deadline that could affect electric reliability and create significant economic impacts to consumers.

On December 1, the EPA filed a motion in the U.S. Court of Appeals for the District of Columbia Circuit opposing several petitioners’ motions to stay CSAPR while litigation concerning its implementation, EME Homer City Generation LP v. EPA, D.C. Cir., No. 11-1302, is pending.

The EPA argued that the claims that CSAPR will require large emissions reductions starting on January 1, 2012 have been “grossly exaggerated” and that the state emissions budgets set by the EPA for 2012 and 2013 under CSAPR are based on emissions controls that either already exist or have been planned. The EPA further defended its rule by arguing that it was justified in issuing Federal Implementation Plans (FIPs) rather than requesting State Implementation Plans (SIPs), and also argued that, while there will be compliance costs to industry as a result of the rule, these costs do not amount to “irreparable harm.”

Additional information is available on the Great Lakes Legal Foundation Regulatory Watch CSAPR webpage.

This post was authored by GLLF staff attorney Emily Kelchen.