U.S. Supreme Court Rules on EPA GHG Permitting Requirements: Provides Partial Reprieve

Authors: Edward Clark Lewis, Bob Greenslade Publication | September 2014
Published in: Energy Law Report

Introduction

Recently, the United States Supreme Court issued its opinion in Utility Air Regulatory Group v. EPA,1 holding that the federal Clean Air Act (“CAA”) does not allow the U.S. Environmental Protection Agency (“EPA”) to regulate emissions sources under the Prevention of Significant Deterioration (“PSD”) and Title V permitting programs based solely on greenhouse gas (“GHG”) emissions.

Specifically, the Court held that the EPA’s interpretation that GHGs are “regulated pollutants” that can, on their own, trigger PSD and Title V permitting requirements was impermissible because it would cover small sources that Congress did not expect would need to undergo permitting. In addition, the EPA cannot deviate from the explicit 100 and 250 tons per year (“tpy”) applicability thresholds established under the CAA for the PSD and Title V programs. However, the Supreme Court also held that the EPA did have discretion to require Best Available Control Technology (“BACT”) for “anyway” sources, meaning sources which are otherwise subject to PSD permitting requirements based on emissions of conventional, non-GHG pollutants. For these sources, the Court determined that the EPA may establish de minimis thresholds, above which BACT would be required if PSD review was already triggered for other pollutants.

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