Speculation about the Stay’s Effects on CPP’s Deadlines

Posted on May 5, 2016 by Jessica Bell

For those thinking about where the CPP’s deadlines may land, the Institute for Policy Integrity at the NYU School of Law provides some perspectives in its April 2016 report.  The report looks at precedent under the Obama Administration (Cross State Air Pollution Rule), the George W. Bush Administration (Routine Maintenance, Repair, and Replacement exclusion), and the Clinton Administration (NOx SIP Call).  The report argues that these examples support EPA’s continued work on the CPP while the stay is pending.

The report also provides an interesting take about a stay versus an injunction, noting that an injunction, which requires supporting reasons, would be a more appropriate basis for arguing that EPA should “put its pencil down.” The report also counters arguments made by Sidley Austin, counsel for certain petitioners in the CPP litigation, in a white paper.  The white paper argued that “[t]olling of the deadlines is required by straightforward operation of the Stay.”  In contrast, NYU’s report takes the position that the D.C. Circuit may ultimately treat the CPP deadlines differently, and “[a]s a result of the inherent uncertainty about the Plan’s timeline after the stay is lifted, EPA should make a strong effort to provide compliance tools and guidance while the stay is in place.”

Along these lines, a group of states recently asked EPA for “additional information and technical assistance related to the final Clean Power Plan in a manner that is respectful of the Supreme Court’s stay of the regulations until the conclusion of pending litigation.”  Recognizing that EPA has already committed to providing assistance as requested, the states ask EPA to provide a final model rule or rules, as well as information on the Clean Energy Incentive Program, tracking systems for allowances or credits, and energy efficiency evaluation, measurement, and verification.  Officials from California, Colorado, Connecticut, Delaware, Maryland, Massachusetts, Minnesota, New Hampshire, New York, Oregon, Rhode Island, Vermont, Virginia, and Washington signed onto the letter.

 

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DOE Opens Application Period for Hydroelectric Incentive Payments

Posted on May 4, 2016 by Amber Martin

Last Tuesday, April 26, 2016, the Department of Energy (DOE) Office of Energy Efficiency and Renewable Energy announced it is now accepting applications for Hydroelectric Production Incentives for hydroelectricity generated and sold during the 2015 calendar year.  The program, established through the 2005 Energy Policy Act, provides for incentive payments of up to 2.3 cents per kilowatt hour, with maximum payments of $750,000 per year, for owners and operators of projects that produced hydroelectric power in 2015 from new equipment added to an existing dam or conduit constructed before 2005.  DOE has also published guidance for applicants seeking to participate in the incentive program, which includes information on eligibility and application contents.  Owners and operators of qualified hydroelectric facilities seeking to participate in the incentive program have until midnight May 31, 2016, to file applications.

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EPA Declines to Reconsider New Source Performance Standards

Posted on May 3, 2016 by Jessica Bell

UPDATED 05.06.2016 EPA’s decision was published in the Federal Register on May 6, 2016.

On April 29, EPA released its denial of five petitions for reconsideration of the New Source Performance Standards, filed by Utility Air Regulatory Group, American Electric Power, Ameren Corp., the State of Wisconsin, and Energy and Environment Legal Institute.  EPA is deferring action on the issue of treatment of biomass, raised by petitioners Biogenic CO2 Coalition and the State of Wisconsin.  This notice of final action has not yet been published in the Federal Register (publication will trigger the clock to seek judicial review of EPA’s action).

In its Basis for Denial of Petitions,  EPA summarizes the arguments made in the petitions and its rationale for denying reconsideration.  Petitioners argued, among other things, that CCS is not adequately demonstrated (and discussed, in particular, operational experience at SaskPower Boundary Dam), EPA’s estimates of CCS capital costs are arbitrarily low, and EPA selecting an arbitrary baseline emission rate from which to calculate emission reductions.  Ameren argued that the NSPS should be considered as a single unit of rules with the proposed federal plan.  Energy and Environment Legal Institute argued that an EPA official engaged in illegal ex parte contacts with environmental organizations before EPA proposed the rule.

EPA determined that the issues raised in the petitions for reconsideration do not cause it to deviate from its findings and conclusions.

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EPA Issues Supplemental Finding in Response to Michigan v. EPA

Posted on April 28, 2016 by Jessica Bell

On Monday, EPA’s final supplemental finding to its Mercury and Air Toxics Standards (MATS) in response to Michigan v. EPA was published.  EPA concludes that consideration of cost does not change its earlier decision that regulation of hazardous air pollutants from coal- and oil-fired electric generating units is appropriate and necessary.  EPA had proposed this supplemental finding last fall after the Supreme Court found that EPA erred in not taking costs into account in the rule and directed EPA to consider costs, including cost of compliance, before deciding whether the regulation is appropriate and necessary under Section 112 of the Clean Air Act.

EPA notes that looking at different cost metrics—historical annual revenues, annual capital expenditures, and impacts on retail electricity prices—the cost of complying with MATS is “within the range of historical variability.” EPA found that no information submitted during the comment period on the supplemental finding causes it to conclude otherwise.  This supplemental finding is now eligible for judicial review as described in the notice.

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After Weeks of Uncertainty, Senate Passes Bipartisan Energy Bill

Posted on April 26, 2016 by Jeff Bayne

On April 20, 2016, the Senate passed the Energy Policy Modernization Act of 2016, the first broad energy bill to come out of the Senate since 2007.  The bill had been stalled for weeks over disagreement about whether to include funding for Flint, MI (which ultimately was not part of the bill), but in the end it passed 85 to 12 with broad bipartisan support.

The bill includes a wide range of provisions, including ones that:

  • reform the hydropower relicensing process;
  • allow federal mortgage lenders to consider energy efficiency when implementing loan eligibility requirements and determining ability of an applicant to repay;
  • raise the conservation standards for federal buildings; and
  • fund research and development in areas such as marine and hydrokinetic renewable energy, carbon capture technology, cybersecurity, and energy storage.

While the bill had bipartisan support in the Senate, it has received somewhat mixed reviews outside of that chamber.  Back in January, when the bill was still in limbo, the Obama administration praised certain elements while expressing concern with other parts of the legislation, such as the practicality of reforms to the hydropower relicensing process.  Edison Electric Institute applauded the passage of the bill, in particular the repeal of a ban on fossil fuel-generated energy at federal buildings, whereas the Sierra Club opposed it for not going far enough on renewable energy.

In terms of next steps, the Senate bill will need to be reconciled with the version passed by the House back in December 2015.  In the meantime, the Senate has moved on to more energy-related matters, debating appropriations for the Department of Energy and related agencies for the fiscal year 2016.

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