09 December 2021

Eighth Circuit Denies Rehearing Request in Wide-Ranging New Source Review Appeal

On November 30, 2021, the U.S. Court of Appeals for the Eighth Circuit denied cross-petitions for rehearing in United States v. Ameren Missouri, a case that addressed the reach of the new source review (NSR) requirements of the Clean Air Act (CAA). In denying the cross-petitions, the Eighth Circuit left in place an August 20, 2021, panel decision that, among other things, upheld the Eastern District of Missouri’s decision to impose injunctive relief for past NSR violations but reversed the District Court’s decision to require controls at a different power plant operated by Ameren as a way of offsetting past violations. As such, the court leaves in place precedent that sustains the United States’ authority to seek and obtain injunctive relief for wholly past violations — but may be cited as a limit on future government efforts to obtain relief beyond bringing a source into compliance.

In Ameren, the United States alleged that the company failed to comply with prevention of significant deterioration (PSD) requirements at its Rush Island power plant. The Rush Island plant went into service in 1976-77 and was therefore grandfathered in to the PSD program. As a result, federal law did not require the Rush Island plant to install pollution control for sulfur dioxide emissions. In 2005, Ameren decided to make a series of changes to the plant over the following five years that resulted in greater energy production, which the government alleged also caused an increase in the plant’s sulfur dioxide emissions. Under the CAA, major modifications at facilities can trigger a number of reviews, permitting requirements, and pollution control requirements. A major modification means a change that results in significant emissions increase of an NSR pollutant. The District Court concluded that the Rush Island plant had undergone a major modification, triggering PSD pollution-control requirements that it found the Rush Island plant had failed to meet.

On appeal, Ameren argued (among other things) that the District Court lacked jurisdiction to impose injunctive relief for past violations. In support of its “past violations” argument, Ameren argued that a prior case, United States v. Homer City Generation, L.P., stood for the proposition that injunctive relief was inappropriate to cure wholly past violations. The Eighth Circuit distinguished Homer City as addressing whether injunctive relief was available to cure past violations by a facility’s former owners, not current owner. Turning to the statutory text, the Eighth Circuit held that injunctive relief for past violations was appropriate where the same entity continued to operate the facility.

Ameren also argued that the District Court erred when it ordered injunctive relief against a different facility, the Labadie plant, which had not violated the CAA. The District Court concluded that such injunctive relief was appropriate because it would offset the Rush Island plant’s historic pollution. The Eighth Circuit agreed with Ameren and reversed this portion of the judgment because the government’s civil enforcement authority was limited to “retrain[ing] such violation[s].” 42 U.S.C. § 7413(b)(1)-(3). Because the violation occurred at the Rush Island plant and the government had not alleged or proven a violation at Labadie, the District Court lacked jurisdiction to impose an injunction on the Labadie plant.

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