To help reboot after the holiday break, here is a list of air topics we expect to make news in 2022 with a short discussion of why each one may be important to you.
1. Supreme Court Review of EPA’s Authority to Regulate CO2 from Power Plants
The long running saga of EPA’s effort to regulate CO2 emissions from power plants will reach a peak in 2022 as the Supreme Court prepares to issue the final word on EPA’s authority to address climate change under Section 111 of the Clean Air Act.
Four petitioners’ briefs were filed at the end of 2021, along with over a dozen amicus and supporting briefs, arguing that Section 111 does not provide a clear enough statement to authorize anything like the Clean Power Plan adopted under the Obama administration. That plan was based on the assumption that the energy sector could be forced away from fossil fuels and toward renewable resources to reduce CO2 emissions, even though Section 111 focuses on control of stationary sources, not industrywide restructuring.
EPA’s brief is due in just a few weeks, and the agency is expected to argue that Section 111 provides ample authority to require CO2 reductions via the kind of regulatory regime found in the Clean Power Plan, which relied on emissions allowance trading. EPA will say that although the Clean Air Act is ambiguous, that ambiguity provides flexibility, and the Court should retain its practice of deferring to expert agencies in circumstances like these.
Oral argument, currently scheduled for February 28, will provide an opportunity to see the justices’ reactions to the arguments on either side. The outcome of the case could have a critical impact on EPA’s plans for regulating greenhouse gas emissions from the power sector and set the stage for any future efforts by EPA to regulate other industries in similar fashion.
2. EPA’s Methane Rule for Oil and Gas
EPA also will seek to address climate change in 2022 by strengthening its methane rules for the oil and gas sector. EPA first tackled oil and gas methane emissions from new sources in 2016 under the Obama administration, only to have those rules rescinded by the Trump administration. Congress revived the rules in 2021 via the Congressional Review Act, and EPA now has proposed to both strengthen the rules and extend them to existing sources.
Although the methane rules also stem from EPA’s Section 111 authority, they do not raise the same issues currently under review by the Supreme Court because the rules do not require restructuring of an industry. Rather, they focus on work practices and other measures that can be implemented at individual sources. However, EPA’s 2021 proposal did not contain the actual regulatory text for its proposed rules, so many details remain unclear. EPA is expected to release draft text in early 2022, offering stakeholders another opportunity to comment.
3. DC Circuit Reviews the SSM SIP Call
Another important air-related case that could have far-reaching implications on the split of authority between EPA and the states involves the “SSM SIP Call” — EPA’s 2015 “call” for states to revise or eliminate provisions in their state implementation plans (SIPs) related to emissions during startup, shutdown, and malfunction (SSM). Those provisions allowed relief from penalties for unavoidable emissions since air pollution control equipment sometimes cannot meet standards designed for normal operation due to periods of SSM.
The SSM SIP Call was based on EPA’s determination that certain kinds of exemptions and affirmative defenses for SSM events were categorically inconsistent with the Clean Air Act and must be changed. Many states responded to the SSM SIP Call by eliminating or revising their SSM provisions, but several states failed to respond at all.
The SSM SIP Call was challenged by numerous states and industry petitioners, and the case was fully briefed and ready for oral argument in early 2017. However, the Trump administration asked the D.C. Circuit to hold the case in abeyance while EPA reconsidered its SSM policy. The Trump EPA ultimately issued a memo in 2020 saying SSM provisions can be legal, but the Biden EPA has now rescinded that memo and returned to its position that SSM provisions are categorically unlawful. As a result, the parties have revived the litigation to settle the dispute over EPA’s authority to require states to remove or revise their SSM provisions.
The court will hold oral argument “on the first appropriate date following the completion of supplemental briefing,” which the parties will complete in early February. The outcome of the case will be particularly important for states that either did not respond to the SIP Call or have not yet received EPA approval for a response, but it may also offer the court yet another opportunity to clarify the respective roles of EPA and states more generally.
4. Regional Haze on the Horizon
The Clean Air Act regional haze program has a relatively narrow purpose — improving visibility in national parks and wilderness areas — but it has resulted in broad controversy over the years because it too raises questions regarding the intersection of EPA and state authority. The program requires states to develop 10-year plans for reducing visibility degradation, but EPA has rejected many state plans in the past and issued federal plans to impose more stringent emission control measures than the states determined to be necessary.
EPA required the latest plans to be submitted for approval by July 31, 2021, but most states missed the deadline, although many continue to work on their plans in the hope of avoiding a more stringent federal plan. From the plans submitted thus far and those under development, a difference of opinion on the focus of the program is already apparent — guidance issued by EPA in 2021 says states must require controls even if they will not meaningfully improve visibility, while many state plans are rejecting expensive control options precisely because any improvement they would provide would be too small to see.
In 2022, EPA will begin the state-by-state process of approving and disapproving regional haze plans, which will inevitably lead to more litigation.