Court to hear clean air case

Portland Press Herald

Wednesday, November 1, 2006

WASHINGTON - The Supreme Court will hear oral arguments today in an air-pollution case being closely watched by Maine and other
Northeast states because it could have broad implications for the types of emissions allowed from aging coal-fired power plants around the country.

The case will determine whether utilities must install modern pollution-control equipment when upgrading their plants. At stake are billions of dollars in additional costs that power companies say could discourage improvements, versus thousands of tons of pollution that environmentalists argue could be spewed into the air. A decision is expected by June.

The case is important to northeastern states like Maine because an estimated 80 percent of the state's air pollution drifts in from elsewhere.

"The stakes are high in this case for the northeastern states because the interpretation of the Clean Air Act that industry is urging on the court would allow major plant modifications to go forward that significantly increase emissions without the installation of modern pollution controls," said Jerry Reid, assistant attorney general in Maine.

"The plants that would benefit most from this change are the aging coal-fired utilities to our south and west that send thousands of tons of pollution toward us every year," he said.

But one of the plaintiffs in the lawsuit, Duke Energy Corp., and groups representing utilities contend that U.S. Environmental Protection Agency regulations requiring the best pollution controls would discourage lesser modifications that could improve efficiency and reduce emissions. "EPA's enforcement approach is out of step with history and the basic statutory and regulatory framework," Carter Phillips, a Duke lawyer, argued in the case.

The case is one of two that the Supreme Court will review this month dealing with emissions. The other case, scheduled for oral argument Nov. 29, deals with carbon-dioxide emissions from motor vehicles. The cases could have a broad impact on what emissions are allowed.

"This is a good way for the court to say, 'Here are a few ground rules,' and in doing so, they can knock some issues off the litigation table," said Scott Segal, an industry lawyer in the case.
In the case to be argued today, Duke challenged EPA regulations adopted in 1980, getting a favorable ruling from the 4th U.S. Circuit Court of Appeals.

But three environmental groups -- Environmental Defense and North Carolina chapters of the Sierra Club and Public Interest Research Group -- contend that Duke was decades too late in challenging the rules and that the appeals court didn't have the authority to hear the case.

U.S. Solicitor General Paul Clement sided with the environmental groups.

The case deals with 1977 changes to the 1970 Clean Air Act, which was written by former Maine Sen. Edmund Muskie. Congress adopted tougher pollution standards at that point, but didn't force older power plants to meet them because aging plants were expected to close.

"Major modifications" were supposed to force the installation of better pollution-control equipment, but "routine maintenance, repair and replacement" were excluded. The fight in the court case is over what repairs qualify as "major modifications."

The environmental groups quote regulations saying "any physical change" that "increases the amount of air pollution." Under that standard, called Prevention of Significant Deterioration, emissions are measured in "tons per year."

But Duke argued that a rival method, called New Source Performance Standards, should prevail. Under that, pollution is measured hourly.
The crux of the legal dispute is that as long as the hourly rate of pollution doesn't increase, pollution controls shouldn't stiffen. But environmental groups and the federal government contend that increasing overall pollution from plants operating more days each year is what counts.

The environmental groups project that each power plant could generate hundreds of tons more pollution each year if Duke wins. For example, one of Duke's plants in the case hadn't operated for 10 years, but if rehabilitated under its operating permit would emit 873 tons of pollution per year.

States are sharply -- and geographically -- divided. Most of the Northeast's air pollution floats in from power plants in the West and South. Maine was among 14 states siding with the environmental groups and federal government.

"A plant whose modifications enable it to operate more hours may well substantially increase its total annual emissions, even if the modification does not increase its hourly emission rate," Caitlin Halligan, New York's solicitor general, wrote in an argument for the states.

But another 11 states in the South and West contend that EPA is usurping state authority.

"The cost -- in money, time and labor -- of EPA's enforcement initiative will create what EPA itself has called a 'perverse' incentive for industry to eschew upgrades in favor of limping by on old, deteriorating and environmentally unfriendly equipment," Kevin Newsom, the solicitor general for Alabama, wrote in his argument.
Several medical groups filed an argument that boosting power-plant emissions could hurt public health.

"Air pollution can have severe, even fatal, health effects," said Hope Babcock of Georgetown University Law Center. "Air pollution is especially harmful to children and their developing respiratory systems."

Washington D.C. Correspondent Bart Jansen can be reached at 202-488-1119 or: bjansen@pressherald.com.