February 5, 2016

Section 115 not a viable climate policy option

Every couple of years, someone rediscovers section 115 of the Clean Air Act and announces that it can be used to reduce U.S. greenhouse gas emissions (“GHGs”) in a new and comprehensive way.  But using §115 in that way would give EPA completely unconstrained power that we do not think Congress ever intended, and that the courts would never uphold.

Because nothing is more international in both its causes and its consequences than global warming, §115’s allure begins with its title: “International Air Pollution.”  Section 115 authorizes EPA to require states to limit emissions of “any air pollutant” that may “cause or contribute to air pollution which may reasonably be anticipated to endanger public health or welfare in a foreign country.”  The argument is thus that since GHGs endanger public health and welfare in other countries just as much as in the U.S., EPA may now invoke §115 and require each state to submit “a plan revision with respect to so much of the applicable implementation plan as is inadequate to prevent or eliminate the endangerment.”  (As noted below, §115 was presumably meant to apply only to “NAAQS” pollutants—ozone, sulfur dioxide, particulate matter, etc.  as this authority parallels EPA’s “domestic” regulatory authority over those.)

Renewed interest in §115 came on January 14 with the publication of “Legal Pathways to Reducing Greenhouse Gas Emissions Under Section 115 of the Clean Air Act” which claims that §115 allows EPA to:

combine multiple sectors and source types in a single rule-making that could establish a nationwide, market-based emissions reduction program. Such an approach would be legally defensible, and while implementation issues would be inevitable, as they are in any regulatory program, they would also be manageable. Ultimately, regulation of GHG emissions under Section 115 would provide EPA with the opportunity to develop a comprehensive, market-based, nationwide platform that would increase the scope of emissions covered, streamline administrative efforts, and maximize market efficiencies.

If only.

We share the authors’ apparent frustration with both the utter failure of Congress to address the issue, and the glacial pace and complexity of EPA regulation.  But we think they are wrong to look to §115 as a replacement for either.

This is not a law review article, so we address only one of the many issues concerning whether §115 so authorizes EPA.  It is one which the authors do not answer or even address: how is it that even though Congress puts explicit limits on every form of emissions control regulation EPA could use to address GHGs if they endanger health or welfare within the U.S., Congress gave EPA unrestricted authority to impose whatever emission reductions it chooses when that endangerment happens outside of the U.S. Exact same sources, exact same emissions, exact same endangerment . . . but constrained, source-by-source authority on the one hand, and a plenary magic wand on the other.

Take the current situation.  Based on its U.S. endangerment finding, EPA can regulate GHG emissions via, for example, New Source Performance Standards under Section 111 (the authority for EPA’s Clean Power Plan).  But Congress mandated that those standards must be the “best system of emission reduction which (taking into account the cost of achieving such reduction and any non-air quality health and environmental impact and energy requirements) the Administrator determines has been adequately demonstrated.”

What about EPA’s Prevention of Significant Deterioration (“PSD”) regulations for GHGs under Section 165? There, Congress mandates EPA use the “best available control technology,” which means “the maximum degree of reduction . . . which the permitting authority, on a case-by-case basis, taking into account energy, environmental, and economic impacts and other costs, determines is achievable for such facility through application of production processes and available methods, systems, and techniques.”

How about CO2 from cars under §202?  Those standards “shall take effect after such period as the Administrator finds necessary to permit the development and application of the requisite technology, giving appropriate consideration to the cost of compliance within such period.”

Or CO2 in fuels under §211? Only “after consideration of all relevant medical and scientific evidence available  . . . including consideration of other technologically or economically feasible means.”

You get the point.  So how is it that when endangerment from GHGs takes place just across the border, all restraints are off and in a single rule-making, EPA can order states to take whatever measures are necessary to reduce emissions to whatever level EPA thinks is appropriate to “prevent or eliminate” the international – in this case global endangerment?

Forget the Supreme Court; that argument would not survive even the friendliest panel of D.C. Circuit judges.

For those who wish to wander a little further into the legal weeds, our bet is that the courts will carve out GHGs from the phrase “any air pollutant” in §115.  That is precisely what the Supreme Court did to that phrase in the Act’s PSD provisions just two years ago in Utility Air Regulatory Group v. EPA, 134 S.Ct. 2427, 2441 (2014), and observing that “Congress’s profligate use of ‘air pollutant’ where what is meant is obviously narrower than the Act­-wide definition is not conducive to clarity.”  Pace the phrase “any air pollutant,” everything in §115 points to it being meant to apply only to NAAQS pollutants, i.e., those for which EPA has established a “National Ambient Air Quality Standard”: a numerical value representing the appropriate atmospheric concentration of ozone, particulate matter, etc.

Given this, we think the courts will limit §115 to NAAQS pollutants which are the ones that could be usefully regulated in order to eliminate a cross-border endangerment.  Not surprisingly, that is more or less the limitation imposed on the phrase “any air pollutant” by the UARG decision.

EPA could try to invoke §115 if it were first to deem GHGs a NAAQS pollutant, but so far it has refused – with compelling reasons – to even consider doing so.  Among other things, EPA would first have to determine the environmentally-appropriate atmospheric concentration of GHGs, explain to the states why they are required to reduce their emissions when doing so would do virtually nothing toward achieving that global standard, and then figure out how to circumvent the Act’s requirement that EPA reject any state plan that fails to meet that standard. (EPA would also have to repeal the Clean Power Plan, because EPA may not regulate under §111(d) any NAAQS pollutant.)

That §115 keeps coming up shows that there is strong demand for better climate policy in the U.S.  But the challenges in using §115 (both Congressional intent and what we’ve already seen from the courts) to regulate GHGs make any successful outcome practically impossible. Look elsewhere.