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The Insider

East Coast States, Courts Hike Pressure On EPA Over Interstate Air Rules

EPA is facing increasing pressure from East Coast states, environmentalists and federal courts to directly regulate ozone-forming air pollution from “upwind” states in the Midwest, Mid-Atlantic and the South, a step Trump administration officials continue to strongly resist as unnecessary.

The flurry of recent action on EPA’s interstate air policy includes steps by at least five East Coast states to advance their legal claims that pollution traveling from other parts of the country is making it impossible for them to meet the agency’s air quality standards. These states are seeking direct federal regulation in multiple states, largely in the Midwest.

And environmental groups are threatening to sue over the lack of interstate air pollution plans in 20 states, claiming more federal action is vital for reducing ozone.

The efforts largely center around states’ attempts to attain the agency’s ozone national ambient air quality standards (NAAQS). Several downwind states claim they cannot meet the standards without EPA’s assistance regulating sources in upwind states, but the agency counters that modeling projections suggest the extra regulatory steps are not needed.

The issue arose at Jan. 16 oral argument before the U.S. Court of Appeals for the District of Columbia Circuit regarding Delaware and Maryland’s petitions for EPA regulation of upwind sources under section 126 of the Clean Air Act:

Judges Doubt EPA Bid To Downplay Ozone Ruling’s Impact In Petition Suit
Appellate judges at Jan. 16 oral argument appeared skeptical of EPA’s attempt to downplay the impact of a 2019 ruling faulting its interstate emissions policy in separate litigation two states are pursuing over the agency’s denial of Clean Air Act petitions urging the agency to directly regulate air pollution from sources in upwind states.

During the arguments, judges challenged the agency’s contention that it could rely on its Cross-State Air Pollution Rule (CSAPR) utility emissions trading program to deny the states’ petitions, given a September ruling by the D.C. Circuit finding CSAPR is an incomplete solution for attaining EPA’s 2008 ozone standard.

Given that ruling, “it is not a sufficient answer” for the agency to simply rely on the remanded CSAPR as partial justification for denying the section 126 petitions, said Judge Gregory Katsas, a Trump appointee.

Our preview of the arguments also highlighted EPA claims that Delaware and Maryland failed to prove that power plants they are targeting for regulation are causing a “significant contribution” to the states’ problems in attaining ozone limits:

D.C. Circuit Poised To Hear States’ Suit Over EPA Ozone Petition Denials
The U.S. Court of Appeals for the District of Columbia Circuit is poised to hear Jan. 16 oral argument in East Coast states’ suit challenging EPA’s rejection of their petitions seeking direct federal regulation of out-of-state air pollution sources, even as the agency is scrambling to revise its interstate air policy following losses in related D.C. Circuit cases.

If power plants were found to have such a “significant contribution,” that would violate the Clean Air Act’s “good neighbor” provision requiring states to mitigate their emissions causing attainment problems elsewhere.

Meanwhile, New York and New Jersey are filing new legal arguments supporting their lawsuit over EPA’s rejection of the Empire State’s section 126 petition that seeks regulation of hundreds of sources in multiple upwind states:

New York, Environmentalists Attack EPA Basis For Ozone Petition Denials
New York and New Jersey, backed by environmental groups, are attacking in new appellate court filings EPA’s basis for rejecting the Empire State’s petition seeking direct federal regulation of out-of-state air pollution sources, echoing claims by Maryland and Delaware in a similar suit that the same court will hear on Jan. 16.

As with the Maryland and Delaware challenges, New York and New Jersey argue that EPA wrongly based its denial on its 2016 CSAPR “update” rule and a 2018 “close-out” rule finding that states in the program need do nothing more than fulfill their existing CSAPR mandates to meet the 2008 ozone standard.

“The Denial should be vacated because EPA expressly relied on reasoning in the Update and Close-Out that this Court has now found to be invalid under the Act. Specifically, the Denial is premised on the assumption that the Update fully and timely addresses upwind emissions of ozone and ozone precursors under the 2008 ozone standard. But this Court has now invalidated the Update because it did not fully remedy upwind emissions under the 2008 standard, and vacated the Close-Out for finding otherwise,” New York’s brief says.

The Empire State is also teaming up with Connecticut to advance new litigation seeking to force federal air pollution plans for five upwind states:

New York, Connecticut Sue EPA Seeking Plans To Reduce Interstate Ozone
New York and Connecticut are suing EPA in an attempt to force agency-crafted plans for reducing interstate transport of ozone-forming pollutants from sources in upwind states, the latest step in a growing number of lawsuits over EPA’s interstate air policy that includes challenges to denials of petitions seeking upwind air pollution cuts.

The latest suit asks a district court in New York to compel EPA to issue federal implementation plans (FIPs) detailing emissions reduction requirements for industrial sources of ozone in Illinois, Michigan, Pennsylvania, Virginia and West Virginia.

New York argues the September ruling faulting CSAPR left EPA with no effective program in place to limit interstate smog pollution. CSAPR imposed FIPs on states directly, setting state emissions caps in lieu of state implementation plans (SIPs) that states are supposed to supply themselves under the air law.

CSAPR was largely intended to compensate for the absence of good neighbor SIPs, which states failed to submit. Now, the FIPs are absent for many Eastern states.

In addition, a coalition of environmental groups is threatening to sue EPA over the absence of interstate ozone FIPs for 20 states.

A Nov. 27 notice from several groups vows to file suit within 60 days if EPA fails to impose FIPs on states that have not developed their own SIPs. The timing means that a suit could be filed as early as this month.

The 20 states are: Alabama, Arkansas, Illinois, Indiana, Iowa, Kansas, Louisiana, Maryland, Michigan, Mississippi, Missouri, New Jersey, New York, Ohio, Oklahoma, Pennsylvania, Texas, Virginia, West Virginia and Wisconsin.