27 August 2018

Sidley Environmental Trends

Topics discussed this week include:

  • EPA proposes Clean Power Plan replacement rule
  • Court issues nationwide injunction enjoining EPA delay of effective date of Obama administration’s “Waters of the United States” Rule effectively reinstating the Rule in 26 states
  • D.C. Circuit invalidates EPA’s delay of Obama administration Risk Management Plan Rule
  • Montana judge orders State Department to supplement environmental analysis for Keystone XL Pipeline

EPA proposes Clean Power Plan replacement rule. On August 21, the U.S. Environmental Protection Agency (EPA) announced its proposal to replace the Obama administration’s Clean Power Plan. The new plan, titled the Affordable Clean Energy Rule (ACE Rule), proposes to establish emissions guidelines for states to develop their own plans to reduce greenhouse gas emissions from approximately 600 existing coal-fired power plants at 300 facilities across the country. The ACE Rule prioritizes efficiency upgrades at existing plants and will include a definition of “best system of emission reduction” as “on-site, heat-rate efficiency improvements.” The plan also gives states a list of “candidate technologies” to assist with determining the appropriate plant performance standards and revises EPA’s New Source Review permitting program to further incentivize efficiency improvements. EPA projects that the ACE Rule will provide $6.4 billion in avoided compliance costs as compared with the Clean Power Plan. Once the ACE Rule is published in the Federal Register, EPA will accept comments for 60 days. The EPA is also still in the administrative process of repealing the Clean Power Plan.

Court issues nationwide injunction enjoining EPA delay of effective date of Obama administration’s “Waters of the United States” Rule effectively reinstating the Rule in 26 states. A federal district court judge in South Carolina recently granted summary judgment in favor of groups that argued that the EPA’s rule postponing the applicability date of the Obama administration’s Waters of the United States Rule (WOTUS Rule) violated the Administrative Procedure Act. EPA’s rule delayed the effective date of the WOTUS Rule to 2020 and reinstated a 1986 regulation governing the scope of the Clean Water Act, giving the current administration time to finalize its own “waters of the United States” definition replacement. EPA issued the rule after the Supreme Court ruled that federal district courts had jurisdiction over challenges to the WOTUS Rule. The South Carolina court’s decision orders the WOTUS Rule back in effect in 26 states. In the other 24 states, the WOTUS Rule remains stayed and requires review in cases pending in other federal courts. EPA and industry intervenors have asked the district judge to stay his order pending their appeal to the Fourth Circuit.

D.C. Circuit invalidates EPA’s delay of Obama administration Risk Management Plan Rule. The D.C. Circuit recently ruled that the EPA’s proposed 20-month stay of the effective date of the Obama administration’s Risk Management Plan (RMP) Rule was arbitrary and capricious, holding that the agency had failed to articulate an adequate basis for a delay and lacked statutory authority to use notice-and-comment rulemaking to delay past reconsideration timelines. The Obama administration’s RMP Rule would require facilities that use certain chemicals to comply with additional audit, reporting and notice requirements. The decision could mean that certain elements of the Obama administration’s rule would take effect later this fall, although the D.C. Circuit has not yet issued its mandate in the case, and EPA has 45 days to decide whether it will seek rehearing or rehearing en banc. Various states and citizens’ groups have petitioned the D.C. Circuit to expedite its issuance of the mandate to finalize its decision. Public comment has also just recently ended for EPA’s proposed revisions to the Obama rule.

Montana judge orders State Department to supplement environmental analysis for Keystone XL pipeline. A federal judge in Montana ordered the U.S. Department of State to supplement its environmental impact statement (EIS) for the Keystone XL pipeline. Judge Brian Morris determined that the initial EIS was now deficient because the pipeline had been approved for an alternative route, the environmental impacts of which had not been considered in the State Department’s environmental review. In the same order, Judge Morris declined to vacate the presidential permit to construct the pipeline.

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