Fifth Circuit Grants Stay of EPA’s Implementation of Regional Haze Rule

On July 15, 2016, the U.S. Court of Appeals for the Fifth Circuit granted a judicial stay on EPA’s Regional Haze Rule federal implementation plan for Texas and Oklahoma.  Unlike the Clean Power Plan, the Regional Haze Rule does not have the explicit purpose of reducing CO2 emissions from power plants.  However, challengers in this case argued (among other things) that EPA was using the Regional Haze Rule to improperly target coal-fired power plants, and that 3,000 MW to 8,400 MW of generating capacity in Texas would be forced to retire under EPA’s plan.

The Clean Air Act requires states and the federal government to set and seek to achieve targets for visibility in certain protected federal lands (this rulemaking covered the Wichita Mountains Wildlife Refuge, Big Bend National Park, and Guadalupe Mountains National Park). In 1999, EPA promulgated the Regional Haze Rule to establish guidelines for state compliance with these Clean Air Act visibility requirements.  States are responsible for implementing standards set by the federal government, and only if a state has not complied with the requirements of the Clean Air Act can the EPA create its own implementation plan for that state.  Earlier this year, EPA partially rejected Texas and Oklahoma’s state implementation plans, and imposed its own federal plan.  EPA based part of its rejection on Texas’s failure to conduct source-specific analysis, and EPA’s own plan looked at specific emission controls for the fifteen electrical generating units with the greatest visibility impact on protected areas.

After rejecting EPA’s argument that this case should be dismissed or transferred to the D.C. Circuit, the Fifth Circuit held that the petitioners had satisfied the requirements for a judicial stay.  The Fifth Circuit noted that they had demonstrated a strong likelihood of success in arguing that the EPA acted arbitrarily, capriciously, and in excess of its statutory authority, and in particular that EPA’s requirement of a source-specific analysis was not supported by the Clean Air Act or the Regional Haze Rule.  Although the Fifth Circuit granted the challengers’ motion for a stay, it has not yet issued a decision on the merits of the case.

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