Court Upholds EPA Change of Air Pollution Policy

A federal appeals court largely upheld a Bush administration rule Friday that allowed thousands of power plants and refineries to avoid installing newer pollution control equipment when they modernized, rejecting arguments by California and 13 other states that it violated the Clean Air Act.

However, the ruling by the U.S. Court of Appeals for the District of Columbia concluded that two aspects of the controversial 2002 rule changes “rest on impermissible interpretations” of the 1970 Clean Air Act.

One was a provision that in some cases did not require regulators to consider whether air pollution would get worse under a modernization plan.

The three-judge panel also ruled that the Environmental Protection Agency had “acted arbitrarily and capriciously” by deciding that power plants and other large polluters did not have to keep records of their emissions. The panel concluded that without the documentation, there was no way for regulators to know whether the facilities were breaking the law.

EPA officials said they planned to review the court’s decision to determine whether to challenge it.

The mixed ruling -- parts won praise from environmentalists, and others were cheered by industry groups -- was the latest in a long legal and political battle over the federal government’s approach to cleaning up the nation’s oldest and dirtiest factories and power plants.

A rule known as “new source review” long has required steel mills, power plants, refineries and other large sources of smog and acid rain pollution to upgrade their emissions control equipment when they modernize or expand. The rule was intended to eventually bring the aging facilities, which are responsible for a disproportionate share of the nation’s air pollution, up to current standards.

But as EPA officials have sought to enforce the law in recent years, many companies have fought the requirements, calling them unpredictable and unfair, while environmental groups have filed lawsuits demanding stricter pollution controls.

Bush administration officials have argued that trying to enforce the rules on what has become a case by case basis is a poor way to cut air pollution. They have proposed the entire system be abolished and replaced with a simpler but weaker set of standards as part of the president’s “Clear Skies” initiative, arguing that it would reduce air pollution faster by ending legal squabbles. But environmentalists and many state air pollution officials countered that faithful enforcement of the current law would yield more reductions. Bush’s initiative stalled in his first term and this year did not make it out of a Senate committee.

In the meantime, the Bush administration has made revisions to the new source review rule that have weakened its reach, angering environmentalists and state officials -- who have filed lawsuits challenging the changes -- but pleasing industry groups.

“These NSR reform rules allow refineries to proceed with pollution-preventing activities, and installation of new technology that helps reduce emissions,” the National Petrochemical and Refiners Assn. said in a statement supporting the court ruling. “These reforms also consider industry plant operations as a whole, an important step to more efficient environmental regulation.”

Critics of the changes said they were pleased at least some of the weaker requirements were tossed out.

“The thing we are most pleased about is the rejection of an idea industry has been floating, which is that they get to increase the pollution people breathe as long as plants do not increase their capacity,” said Howard Fox, a lawyer for Earthjustice who represented environmental groups in the case. “That makes no sense.”