A New Year's Surprise: USEPA Agrees to Propose GHG Emission Standards for New and Existing Power Plants and Petroleum Refineries
This post was written by Larry Demase.
In response to challenges by various states and environmental groups to U.S. Environmental Protection Agency’s (USEPA’s) New Source Performance Standards for new electric generating units (“EGUs” or “power plants”) and new process facilities at petroleum refineries (“Refineries”), USEPA has agreed to propose New Source Performance Standards (“NSPS”) for greenhouse gas (“GHG”) emissions from those sources. In addition, it has agreed to issue guidelines for GHG emissions from existing EGUs and Refineries. Promulgation of these rules will be governed by Sections 111(b) and 111(d) of the Clean Air Act and 40 C.F.R. § 60.22.
In the case of EGUs, the agreements require USEPA to sign a proposed rule by July 26, 2011 and after considering public comments to sign, no later than May 26, 2012, a final rule. In the case of Refineries, the proposed rule must be signed December 10, 2011 and the final rule by November 10, 2012. Mindful of the delays that often take place in EPA’s rulemaking, the separate agreements require EPA to regularly update state and environmental groups of USEPA’s progress in developing these rules.
Unexpected in these settlements, which were filed in the U.S. Court of Appeals for the District of Columbia Circuit, is the agreement by USEPA to propose guidelines for existing EGU and Refinery sources, since they were not the subject of the original litigation by the states and environmental groups. See State of New York v. EPA, No. 06-1322 (EGUs) and American Petroleum Institute v. EPA, No. 08-1277 (Refineries). EPA’s agreement, however, is consistent with the Obama Administration’s promise to achieve its climate change goals through existing regulatory authority, since new enabling legislation appears to be foreclosed by the make up of the new Congress. It is also possible USEPA may extend its rulemaking to sources other than EGUs and Refineries.
NSPS must reflect the degree of emission limitation achievable through the application of the best system of emission reduction the USEPA determines is cost effective and has been adequately demonstrated. In the agreements USEPA states that it believes there are cost effective control strategies for reducing GHGs from both EGUs and Refineries. Once the NSPS rules are formally promulgated, states may develop and submit to USEPA a procedure for implementing and enforcing them within the state. Once the guidelines for existing sources are issued, EPA will issue calls to the states to amend their implementation plans to include a plan for controlling GHG emissions based on those guidelines. States may take into consideration the remaining useful life of existing sources within its borders in applying GHG emission limitations to those sources. See Section 111(d)(1) of the Clean Air Act.
The agreements do not specify the content of the NSPS or the guidelines.
