D.C. Circuit Calls Strike Two on EPA’s
Cross-State Air Pollution Rule
By Barry M. Hartman, Ankur K. Tohan, and Christine Jochim Boote
On August 21, 2012, the Court of Appeals for the District of Columbia vacated and remanded the U.S.
Environmental Protection Agency’s “Transport Rule”1 – an ambitious regulation that sought to
impose new limits on sources of certain air pollutants in 28 States.2 In the 2-1 decision, the majority
concluded that EPA went beyond its statutory authority in two separate ways. First, the Transport Rule
required States to reduce cross-state emissions by more than was authorized by the Clean Air Act.
Second, it violated the Clean Air Act by failing to first let each state implement the necessary
emission reductions before implementing federal controls. As a result of this decision, the current
2005 Clean Air Interstate Rule of 2005 (“CAIR”) remains in effect. Going forward, EPA faces the
choice of seeking a rehearing or Supreme Court review, seeking legislative changes, or again revising
the rule.
This alert is part one of a two part series on this topic. Part I discusses the Court’s opinion in Homer
City, how it reached its conclusions, and some of the considerations that will influence whether EPA
might seek rehearing en banc and whether the Circuit is likely to grant it if asked. Part II will address
some of the broader administrative law issues addressed in the decision and how the decision may
impact future challenges to agency rulemakings.
Background
Under the Clean Air Act (“CAA”), EPA sets National Ambient Air Quality Standards (“NAAQS”),
which prescribe the maximum levels for common air pollutants.3 EPA relies on the NAAQS to
designate “nonattainment” areas – i.e., areas within each State where the level of an air pollutant
exceeds the NAAQS.4
Once EPA establishes NAAQS and designates nonattainment areas for the States, the States have the
primary responsibility to determine how to implement the NAAQS within their borders through State
Implementation Plans (“SIPs”).5 If a State fails to submit an adequate SIP within three years of
issuance of the NAAQS, then EPA is required to promulgate a Federal Implementation Plan (“FIP”)
to implement the NAAQS within that State.6
Among the elements that must be included in a SIP are any “good neighbor” emission reductions that
“contribute significantly to nonattainment in, or interfere with maintenance by, any other State with
1 Federal Implementation Plans: Interstate Transport of Fine Particulate Matter and Ozone and Correction of SIP
Approvals, 76 Fed. Reg. 48,208 (Aug. 8, 2011) (“Transport Rule”).
2 EME Homer City Generation LP v. EPA, No. 11-1302, 2012 WL 3570721 (D.C. Cir. Aug. 21, 2012) (“Homer City”).
3 See 42 U.S.C. § 7409(a)-(b).
4 See 42 U.S.C. § 7407(d).
5 See 42 U.S.C. §§ 7404(a), 7410(a)(1); see also Train v. NRDC, 421 U.S. 60, 63-67 (1975); Virginia v. EPA, 108 F.3d
1397, 1406-10 (D.C. Cir. 1997).
6 See 42 U.S.C. § 7410(c)(1).
August 24, 2012
Practice Group(s):
Environmental, Land
and Natural
Resources
Energy
