United States: Clean Air Act - Regulation of Greenhouse-Gas Emissions From Stationary Sources

Last Updated: October 16 2013
Article by Richard B. Katskee

Keywords: Clean Air Act, Regulation, EPA, Greenhouse-Gas Emissions, Stationary Sources

Today, the Supreme Court granted certiorari in one case of interest to the business community:

Clean Air Act—Regulation of Greenhouse-Gas Emissions From Stationary Sources

The Clean Air Act requires the Environmental Protection Agency to regulate "air pollutants" in a variety of circumstances. After the Supreme Court held in Massachusetts v. EPA, 549 U.S. 497 (2007), that greenhouse gases such as carbon dioxide "unambiguous[ly]" may be regulated as an "air pollutant," EPA undertook rulemaking to issue greenhouse-gas regulations. Today, in six consolidated cases, the Supreme Court granted certiorari to address whether EPA permissibly determined that its regulation of greenhouse-gas emissions from new motor vehicles triggered permitting requirements under the Clean Air Act for stationary sources that emit greenhouse gases. The six consolidated cases are Utility Air Regulatory Group v. EPA, No. 12-1146; American Chemistry Counsel v. EPA, No. 12-1248; Energy-Intensive Manufacturers v. EPA, No. 12-1254; Southeastern Legal Foundation v. EPA, No. 12-1268; Texas v. EPA, No. 12-1269; and Chamber of Commerce v. EPA, No. 12-1272.

Under the Clean Air Act, EPA regulates air pollutants from many sources, including both motor vehicles and "major emitting facilities" such as power plants. A major emitting facility is defined as a stationary source that "emit[s] or [has] the potential to emit . . . any air pollutant" in amounts exceeding statutorily defined limits. In general, major emitting facilities must obtain operating, construction, and modification permits and must use "best available control technology" to limit the amount of pollutants that they emit.

In Massachusetts, a group of states challenged EPA's decision not regulate greenhouse-gas emissions from motor vehicles. EPA at that time concluded that greenhouse gases were not an "air pollutant" under the Act's general definition of the term. The Supreme Court rejected EPA's position. The consolidated cases here arise from EPA's rulemaking that followed.

EPA's rulemaking reached a number of significant conclusions. First, EPA found that greenhouses gases were reasonably anticipated to endanger public health or welfare, thereby triggering regulation requirements under the Clean Air Act. Second, EPA issued rules regarding greenhouse gases in motor-vehicle emissions, as contemplated in Massachusetts. Third, EPA found that the term "air pollutant" should be interpreted identically in provisions governing motor vehicles and those governing stationary sources of pollutants such as major emitting facilities. Finally, EPA recognized that applying the existing statutory provisions to greenhouse gases would bring millions of new business and residential facilities under the term "major emitting facilities." To attempt to mitigate this result, EPA announced new, much higher limits for greenhouse-gas emissions before a facility would be subject to the Act's requirements.

The D.C. Circuit upheld each of these conclusions against challenges by a large number of groups. See Coalition for Responsible Regulation v. EPA, 684 F.3d 102 (D.C. Cir. 2012). With respect to the question on which the Supreme Court granted certiorari today, the D.C. Circuit concluded that the Clean Air Act's unambiguous use of the phrase "any air pollutant" in defining "major emitting facility" compelled the EPA's conclusion. Id. at 134. The D.C. Circuit rejected a variety of alternative definitions for the term "air pollutant" as it is used to define "major emitting facility," concluding that "air pollutant" ought to be defined the same way across the statute. Because the Supreme Court had concluded that greenhouse gases are air pollutants for purposes of the motor-vehicle sections of the Act, the D.C. Circuit agreed with EPA's conclusion that greenhouse gases must also be "air pollutants" for purposes of the major-emitting-facilities sections.

The D.C. Circuit denied a petition for rehearing en banc over the dissent of Judges Brown and Kavanaugh. The dissenters wrote that the fact that "[g]reenhouse gases may qualify as 'air pollutants' in the abstract" does not resolve how the term ought to be read in any particular Clean Air Act program. Here, because Congress undeniably did not intend millions of business and residential facilities to be subject to the requirements imposed on "major emitting facilities," the dissenters argued, the term "air pollutant" should not be interpreted to create such a result. It is "a very strange way to interpret a statute," the dissenters reasoned, that once EPA included greenhouse gases in pollutants regulated from stationary sources, it had to enact a rule that substantially raised statutorily defined emission limits in order to avoid absurdly broad regulation that Congress plainly did not intend.

The consolidated cases are of significant interest to any businesses, such as manufacturers, processors, or utilities, with facilities that would qualify as a "major emitting facility" under the EPA's new regulations. In addition, the statutory-interpretation question presented may also touch on broader issues of agency rulemaking and regulatory authority of general interest to the business community.

Absent extensions, amicus briefs in support of the petitioners will be due on December 6, 2013, and amicus briefs in support of the respondent will be due on January 6, 2014. Any questions about these consolidated cases should be directed to Tim Bishop (+1 312 701 7829) in our Chicago office.

Today, the Supreme Court also dismissed the writ of certiorari as improvidently granted in Madigan v. Levin, No. 12-872, which was argued on October 7. The question presented was whether the Seventh Circuit erred in holding, in an acknowledged departure from the rule in at least four other circuits, that state and local government employees may avoid the Federal Age Discrimination in Employment Act's comprehensive remedial regime by bringing age-discrimination claims directly under the Equal Protection Clause and 42 U.S.C. § 1983.

Last week, the Supreme Court invited the Solicitor General to file briefs expressing the views of the United States in six cases of interest to the business community:

Young v. United Parcel Service, Inc., No. 12-1226: The question presented is whether, and in what circumstances, an employer that provides work accommodations to nonpregnant employees with work limitations must provide work accommodations to pregnant employees who are "similar in their ability or inability to work."

United States ex rel. Nathan v. Takeda Pharmaceuticals North America, Inc., No. 12-1349: The question presented is whether Federal Rule of Civil Procedure 9(b) requires that a complaint under the False Claims Act "allege with particularity that specific false claims actually were presented to the government for payment," or whether it is instead sufficient to allege the "particular details of" the "scheme to submit false claims" together with sufficient indicia that false claims were submitted.

Medtronic, Inc. v. Stengel, No. 12-1351: The question presented is whether the Medical Device Amendments to the Federal Food, Drug and Cosmetic Act preempt a state-law claim alleging that a medical-device manufacturer violated a duty under federal law to report adverse-event information to the FDA.

Kellogg Brown & Root Services, Inc. v. United States ex rel. Carter, No. 12-1497: The questions presented are (1) whether the Wartime Suspension of Limitations Act—a criminal-code provision that tolls the statute of limitations for any offense involving fraud against the government when the United States is at war—applies to claims of civil fraud brought by private relators and is triggered without a formal declaration of war; and (2) whether the False Claims Act's first-to-file bar—which prohibits repetitive claims by other relators once one relator files suit—allows for duplicative claims to be filed later if no prior claim is pending at the time of the filing.

Maersk Drilling USA, Inc. v. Transocean Offshore Deepwater Drilling, Inc., No. 13-43: The question presented is whether offering, negotiating, and entering into a contract in Scandinavia to provide services using a potentially patented device constitutes an "offer to sell" or "sale" of an actually patented device "within the United States" under 35 U.S.C. § 271(a).

Thurber v. Aetna Life Insurance Co., No. 13-130: The questions presented are (1) whether an ERISA Plan may enforce an equitable lien by agreement under Section 502(a)(3) of ERISA where the Plan has not identified a particular fund that is in the defendant's possession and control at the time that the Plan asserts its equitable lien; and (2) whether a discretionary clause in an ERISA Plan mandating that an abuse-of-discretion standard of judicial review be applied to a Section 502(a)(1)(B) denial-of-benefits claim is enforceable when the clause was never disclosed to the participant in any plan document, or whether the Plan must instead give participants and beneficiaries clear notice of the clause.

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