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The Week Ahead

Posted: July 14, 2014

Energy Regulators Weigh ESPS; House Lawmakers Target Water Act, IRIS Assessments

A slew of groups, including one representing state electricity regulators, is hosting discussions this week on EPA's proposed greenhouse gas rules for existing power plants. House lawmakers are slated to mark up a set of bills that would curb EPA's authority under the Clean Water Act and review the agency's chemical risk assessment program.

Climate ESPS

The National Association of Regulatory Utility Commissioners is holding its summer meeting in Dallas, TX, through July 16, with much of the focus on compliance strategies for EPA's newly proposed existing source performance standards (ESPS) for power plants, including assessments of the flexibility the rules give to state regulators; the regulations' effects on grid reliability; and strategies for reducing methane emissions from natural gas transmission, storage, and distribution.

Already, EPA Administrator Gina McCarthy has spoken at the meeting to encourage the formation of multi-state partnerships to work on GHG reduction plans, offering states more time to craft the plans and saying they could be more cost-effective and accurate than state-specific compliance plans.

Acting EPA air chief Janet McCabe is also set to discuss the ESPS at an ICF International breakfast July 17 titled “ESPS Regulations: They're Out, But What Do They Mean?.”

And the Environmental Law Institute is conducting a full-day seminar July 14 on the practical and legal implications of EPA's proposed ESPS for power plants' GHG emissions, including discussion of state flexibilities, the definition of the "best system of emission reduction" mandated by the rule and a look ahead at potential litigation over the rule. Industry is already weighing in on the alleged deficiencies of the proposal, though most are holding back on formal comments.

Meanwhile, the American Council On Renewable Energy (ACORE) is planning a July 16 webinar to discuss the implications of EPA's proposed ESPS, titled "One Step Forward, Two Steps Backwards: USEPA’s Carbon Reduction Strategy for Power Plants and Transportation Fuels.” The agenda includes comparison of the terms of the ESPS with the agency's proposed cuts to its renewable fuel standard (RFS) production goals for 2014, which ACORE says “called into question the Administration’s commitment to reducing carbon emissions from the transportation sector.”

The Energy Information Administration is hosting its 2014 Energy Conference July 14 and 15 in Washington, DC. Topics on the agenda include discussion of trends in renewable energy sources and the future of biofuels.

Clean Water Act

Congress, EPA and stakeholders are all holding discussions to assess the agency's regulatory authority under the Clean Water Act (CWA), with a focus on the controversial proposed rule to clarify the reach of the law as well as EPA's interpretation of its “veto” power over dredge-and-fill permits under CWA section 404.

Both issues are also the subject of House bills set for full-committee markup this week. The House Transportation & Infrastructure Committee is set to mark up a series of bills, including H.R. 4854, which would bar EPA from issuing a section 404 veto either before a permit application is filed or after the permit has issued; as well as the newly proposed H.R. 5078, which would prevent EPA and the Army Corps of Engineers from finalizing their controversial proposed rule to define what waters are jurisdictional.

EPA's supporters are urging committee members to postpone the markup, noting that neither bill has been the subject of a legislative hearing. “There are still two days for the committee to see the mistakes it is making, postpone the markup, and take a critical look at the damage its bills would cause,” Trout Unlimited says in a July 14 press release.

The markup will follow a July 15 hearing of the water resources and environment panel discussing EPA's CWA veto powers, titled “EPA’s Expanded Interpretation of its Permit Veto Authority under the Clean Water Act.” Witnesses include representatives from the mining, construction and road building industries, and proceedings are expected to focus largely on the novel veto of a mountaintop mining discharge permit for a West Virginia coal mine, long after the permit was first issued -- which the U.S. Court of Appeals for the District of Columbia upheld in its 2013 decision, Mingo Logan v. EPA.

Legislative action comes as industry has launched a new suit to stop EPA from issuing a novel preemptive veto of the planned Pebble Mine in Alaska's Bristol Bay watershed, which mining and other companies have often linked to Mingo Logan as emblematic of EPA's expanding 404 authority.

And EPA will host a July 16 webinar aimed at defending the CWA rule, titled “Waters of the U.S.: Clarifying Misconceptions.” EPA is hoping to counter widespread industry and Republican opposition, which the agency describes as “confusion about the proposal.”

An alliance of sportsmen's and conservation groups will hold its own briefing in support of the controversial rule July 15. Trout Unlimited, the Theodore Roosevelt Conservation Partnership, the Association of North American Steelheaders and Ducks Unlimited are co-sponsoring the event, “Hunting and Angling Benefits of Restoring the Clean Water Act.”

IRIS Assessments

The environment and oversight panels of the House Science Committee will hold a joint hearing July 16 on EPA's risk assessment program, titled “Status of Reforms to EPA’s Integrated Risk Information System” (IRIS).

The hearing provides the first option for lawmakers to address IRIS officials after the recent National Academy of Sciences (NAS) report that generally praised the reform measures EPA has taken so far but also called for additional reforms, such as providing technical advice to communities so they can provide more informed comments on cleanup plans.

Even some of the program's harshest critics, such as Sen. David Vitter (R-LA), have conceded that the reforms are an improvement but have sought additional changes. “Overall, the changes that EPA has proposed show some initial improvements in their chemical assessment process, but by no means is this report a reason to spike the football,” Vitter said shortly after release of the NAS panel report.

While EPA has sought to have more robust public participation in the IRIS process, environmental and public health groups are criticizing the agency for selecting more speakers from industry than from other sectors in some reviews, charging the selection will enhance industry influence on the assessments.

Even as Congress weighs in, work on assessments is continuing. The Science Advisory Board's Chemical Assessment Advisory Committee (CAAC) is meeting July 14-16 to review EPA's draft IRIS assessment of ammonia. CAAC's review of the draft, which EPA released for public comment last year, is part of a move to improve IRIS in the wake of the 2011 NAS report.

Air Quality

Industry groups are petitioning the Supreme Court July 14 to review EPA's power plant maximum achievable control technology (MACT) air toxics regulation. The groups are asking the high court to overturn a ruling from the U.S. Court of Appeals for the District of Columbia Circuit in White Stallion Energy Center LLC et al. v. EPA et al, whichupheld the MACT.

High court review of the case could also tee up the question of when companies meet the so-called “zone of interests” test for standing to sue, a contentious issue that Judge Brett Kavanaugh in his narrow dissent and concurrence argued is in need of clarification.

In other air quality litigation, environmentalists have until July 18 to file their statement of issues in Sierra Club v. EPA, et al., in which advocates are petitioning the agency to drop the “affirmative defense” from several existing air rules after the DC Circuit in April struck down the defense in a suit over a cement air toxics rule.

The suit accompanies a petition for rulemaking that asks EPA to implement the April ruling by removing the affirmative defense from over a dozen criteria pollutant new source performance standards (NSPS) and national emissions standards for hazardous air pollutants (NESHAP) designed to reduce air toxics from industries. While the court petition may not move forward immediately, it will preserve Sierra Club's ability to pursue the issue in court if the agency rejects or defers a response to the rulemaking petition.

EPA has set a public hearing for July 16 in Wilmington, CA, on its proposed risk and technology review and new source performance standards (NSPS) for the petroleum sector -- a regulatory package that sets MACT requirements for various equipment used at refineries, and also sets standards to ensure better control of emissions from flares.

Industry has criticized the risk assessment underlying the plan, charging that stricter requirements are not necessary because the risks from the facilities have decreased with declining emissions, so a tightening of the rules cannot be justified.

EPA's Clean Air Scientific Advisory Committee (CASAC), meanwhile, will host a public teleconference July 16 to discuss the agency's upcoming revision of the National Ambient Air Quality Standard (NAAQS) for sulfur dioxide (SO2) and its proposal for a new federal reference method for ozone.

EPA is seeking input on a host of scientific questions that will shape its upcoming review of the SO2 NAAQS, including the link between SO2 and climate change, adverse respiratory impacts and whether other pollutants can confound conclusions on the risks of SO2 exposure. Along with CASAC review, comments are due on data requirements for the SO2 NAAQS July 14.

Finally, July 14 is the deadline for EPA's first appellate brief in industry's revived litigation over the 2012 NESHAP for chromium electroplating facilities, National Association for Surface Fishing v. EPA, et al. The suit, which seeks to overturn a district court ruling in EPA's favor, was revived in 2013 after EPA denied an administrative petition from the surface fishing industry that argued that the rule is unsupported by science.

FY15 Budget

Even though President Obama has threatened to veto EPA spending legislation that bars the agency from adopting high-priority policy items, the House Appropriations Committee will hold a full committee markup July 15 to consider the proposed fiscal year 2015 spending bill for EPA that seeks to block several pending EPA policy measures.

House lawmakers said recently that they are advancing spending legislation for EPA and other agencies in the hope that it would trigger conference negotiations with the Senate on an omnibus spending package, which could be the vehicle for resolving fights over whether to cut EPA's budget and provisions that would block key agency policies.

The draft bill would cut EPA's budget by $717 million, or 9 percent, down to $7.5 billion compared to its existing $8.2 billion funding level and includes policy provisions barring implementation of major EPA climate, water and other rules. And recently released report language recommends additional riders while also directing the agency on how to spend major waste and water funds.