The United States Court for the District of Columbia Circuit (Court) has rejected the U.S. Environmental Protection Agency's (EPA) Clean Air Interstate Rule (CAIR), which was the agency's regional multistate approach to regulating SO2 and NOx.
In North Carolina v. EPA, No. 05-1244 (D.C. Cir. Jul. 11, 2008), the Court found CAIR's regional multistate approach to be inconsistent with the Clean Air Act (CAA). The CAA, as developed in the 1970s and amended in 1990, is based upon a state-by-state approach to regulating regional emission issues. Under the CAA, if emissions from one state adversely affect downwind state(s), then the upwind state is required to impose additional controls to address the pollution problem. According to the Court, the multistate cap and trade program incorporated into CAIR is contrary to the state-based approach mandated by the CAA.
The practical effects of the Court's ruling are:
- The NOx/SO2 regional cap and trade
program that was being implemented in 28 states in the
eastern half of the United States, is invalid and will not
- The earlier NOx State Implementation Plan
(SIP) call program that was supplanted by CAIR is reinstated
for the states involved in that program. Sources that were in
the NOx SIP call program, but then dropped because
of CAIR, will find themselves back in and potentially subject
to more stringent NOx controls, especially given
the recently implemented change in the ozone national ambient
air quality standard.
- The acid rain SO2 trading program remains
"as is." No allowances will be reduced as was to
occur under the CAIR program.
- Some Midwestern states relied on CAIR as a substitute for
implementing a Best Available Retrofit Technology (BART)
(regional haze) program. These states will need to reevaluate
the BART program, which may result in new emission reduction
requirements for facilities implicated in causing regional
haze problems in sensitive environmental areas such as
national parks or wildlife areas.
- To the extent draft and/or current air permits
incorporate CAIR-based requirements, sources will have to
evaluate whether any revisions are necessary.
The decision also raises significant implications for future particulate matter 2.5 micrometers or smaller (PM2.5) controls, which may include emission reductions for PM2.5 precursors that include NOx and SO2. As PM2.5 is only beginning to be subject to regulation, the effect of the decision on future PM2.5 regulation is uncertain.
Based upon past experience, the EPA is not likely to issue clarifying guidance in the near future. Thus, facilities likely will need to discuss specific issues arising from the Court's decision with individual state regulators.