The U.S. Environmental Protection Agency's (EPA) interpretation of the Clean Air Act (CAA) in a series of greenhouse gas (GHG)-related rules was "unambiguously correct," according to a three-judge panel of the United States Court of Appeals for the District of Columbia Circuit, which on Tuesday denied petitions against the EPA's timing and tailoring rules.

Dozens of petitioners had challenged the EPA's endangerment finding, which held that carbon dioxide (CO2) and other GHG emissions pose a danger to the public's health and welfare (see Daily GPI, Dec. 22, 2009), EPA GHG tailpipe rules and EPA's finding that stationary sources of GHG are required by the CAA obtain construction and operating permits.

But in an 82-page opinion issued Tuesday the panel concluded that "the endangerment finding and tailpipe rule are neither arbitrary and capricious [as the petitioners had argued]; EPA's interpretation of the governing CAA provisions is unambiguously correct; and no petitioner has standing to challenge the timing and tailoring rules.

"We thus dismiss for lack of jurisdiction all petitions for review of the timing and tailoring rules, and deny the remainder of the petitions."

Rep. Fred Upton (R-MI), chairman of the House Energy and Commerce Committee and one of the sponsors of a bill (HR 910) that would bar EPA from regulating CO2 and other GHG emissions, said the decision "delivers a devastating blow" to consumers and the U.S. economy.

"The Obama administration is attempting to regulate greenhouse gases in the absence of legislation. Congress and the American people rejected cap and trade legislation, but unelected bureaucrats at the EPA are pushing through harmful regulations that will serve as a massive energy tax on American businesses and families," Upton said.

The ruling "is a setback for businesses facing damaging regulations from the EPA," said National Association of Manufacturers CEO Jay Timmons, who said the CAA was not designed to regulate GHG.

"By moving forward the EPA is adding to the mounting uncertainty facing manufacturers of all sizes," Timmons said. "We will be considering all of our legal options when it comes to halting these devastating regulations. The debate to address climate change should take place in the U.S. Congress and should foster economic growth and job creation, not impose additional burdens on businesses."

But former EPA Administrator Carol Browner, now a senior fellow at the Center for American Progress, characterized the "historic decision" as a win for clean air. "The court's decision should put an end, once and for all, to any questions about the EPA's legal authority to protect us from dangerous industrial carbon pollution through the Clean Air Act, including vehicle emissions," Browner said. "This decision is a devastating blow to those who challenge the overwhelming scientific evidence of climate change and deny its impact on public health and welfare."

The Obama administration formally declared that CO2 and other GHG emissions posed a danger to the public's health and welfare in 2009, which laid the groundwork for EPA to more stringently regulate emissions from power plants, refineries, factories and vehicles -- even if Congress failed to enact climate change legislation (see Daily GPI, Dec. 8, 2009).

In May 2010 EPA finalized a GHG tailoring rule, which specified that beginning in 2011 projects that will increase GHG emissions substantially will require an air permit (see Daily GPI, May 14, 2010). The tailoring rule covered large industrial facilities like power plants and oil refineries, which are responsible for 70% of the GHGs from stationary sources.

EPA's guidance and the tailoring rule were criticized by natural gas associations, business groups and some lawmakers (see Daily GPI, March 5, 2010; Jan. 26, 2010).

The lead case was Coalition for Responsible Regulation Inc. v. Environmental Protection Agency [No. 09-1322], but the decision covers more than 60 consolidated lawsuits brought against the EPA by business groups including the U.S. Chamber of Commerce and the American Chemistry Council and states led by Texas and Virginia.

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