NGI The Weekly Gas Market Report / NGI All News Access

Supreme Court Ruling a Blow to Coal-Burning Plants

The U.S. Supreme Court last Monday let stand a lower court ruling that would require coal-burning generation facilities to comply with the strictest emission controls for mercury and other hazardous air pollutants (HAP).

The high court rejected a petition by the Utility Air Regulatory Group (UARG), a trade group of electric utilities, and large electric utility companies challenging a February 2008 decision by the U.S. Court of Appeals for the District of Columbia Circuit, which requires affected utilities to install costly controls for mercury emissions and other hazardous pollutants at more of their power plants rather than being allowed to rely on a fleetwide trading program. The decision is a major setback for utilities that own coal-burning facilities.

The Environmental Protection Agency's (EPA) clean air mercury rules (CAMR) were issued in 2006 to allow utilities to "trade" high mercury emissions with utilities that had lower mercury emissions as part of a federal plan to reduce nationwide HAP emissions by 70% by 2018.

The rules were quickly challenged in court by states across the country and several environmental and public health groups, as well as the UARG. All of the cases were consolidated in the District of Columbia Circuit (State of New Jersey, et al., v. EPA, No. 05-1097).

The appeals court considered a challenge to two EPA final rules regarding the emission of HAPs from utility steam electric generating units (EGU). The first EPA rule delisted coal- and oil-fired EGUs from the list of sources whose emissions are regulated under Section 112 of the federal Clean Air Act (CAA). The second challenge was to the CAMR performance standards for new coal-fired EGUs that established total mercury emissions for states. The CAMR also established a voluntary cap-and-trade program for new and existing coal-fired EGUs.

The petitioners contended that the EPA's delisting rule was "contrary to the plain text and structure" of Section 112 of the CAA. In turn, the EPA argued that the rules allowed "special conditions" to exempt some EGUs.

"We hold that the delisting was unlawful," opined the appellate court in February 2008. "Section 112 requires [the] EPA to regulate emissions of HAPs." The rule also "requires EPA to regulate EGUs under Section 112 when it concludes that doing so is 'appropriate and necessary.'" The court noted that in December 2000 the "EPA concluded that it was 'appropriate and necessary' to regulate mercury emissions from coal- and oil-fired power plants...and listed these EGUs as sources of HAPs."

Because the EPA determined in 2000 that EGUs should be regulated under the CAA and listed them, the petitioners argued that the EPA had no authority to delist them without taking the steps required. The court agreed.

The appeals court opinion, said Natural Resources Defense Council attorney John Walke at the time, "adds to the momentum against building new coal-fired power plants. This immediately changes the landscape and adds to the argument against new pulverized coal plants."

©Copyright 2009 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.

Comments powered by Disqus