EPA expanded its loopholes for industrial pollution
In 2005, EPA announced another gutting of Clean Air Act rules for polluting industries, making public policy out of an industry excuse the Agency had fought in court in 2002. Then in February 2006, the U.S. Department of Justice, the federal government’s legal arm, announced that it was moving away from enforcing the law against the dirtiest of the industrial polluters, coal-fired power plants.⁷ However, in March 2006, EPA's plans hit a powerful wall—in the decision of the U.S. Court of Appeals that told the agency it could not rewrite clear language in the Clean Air Act.

EPA’s rollbacks in this arena began formally in 2003 when EPA took the first two major steps that cut the legs out from under an important enforcement provision of the Clean Air Act, called New Source Review (NSR). NSR is a process designed to ensure that communities with unhealthful levels of air pollution don’t get more polluted when a new source of pollution comes to the community—like a new industrial facility or an existing facility that is modified in ways that enable it to emit more pollution.

Back in 1999, EPA charged that many electricity-generating utilities had failed to comply with the NSR requirements because they increased emissions of hazardous pollutants at their coal-fired plants without taking the required steps to clean them up. EPA took dozens of these plants to court and began enforcement action against others. As a result of enforcing the law, several utilities began cleaning up some of the dirtiest plants in the nation.

Then in 2002 and 2003, the rules changed. In two sweeping new regulations, EPA rewrote the NSR provisions, providing huge loopholes to industry that allow polluters to significantly increase pollution from existing plants without having to clean up the pollution. These are the some of the changes EPA made:

• Plants will be allowed to “cherry-pick” two years of the last 10 to serve as their baseline for deciding if they need to clean up. Plants that will increase more than one pollutant now can avoid having to reduce the rest their pollutants if they clean up just one of them.
• EPA severely limited the actions state and local governments can take to stop transported pollution. This change would prohibit states from attacking the problem of ozone blown into their area from upwind sources, as the New England and Mid-Atlantic states did in the mid-1990s, which set the stage for the first strong rules to clean up power plants in the late 1990s.
• Under possibly the most damaging set of changes, EPA greatly expanded the list of activities defined as “routine maintenance,” which were already exempted from requiring clean up. EPA redefined “routine maintenance” to mean any project that costs less than 20 percent of the replacement cost of the entire plant, no matter how much additional pollution it creates. So now, no matter what changes are made, or how much pollution increases, EPA will deem the changes to be “routine maintenance” as long as they cost less than 20 percent of the plant’s value. Given that large plants may be worth billions, a company could reconstruct entire wings of their buildings and still have the work considered “routine maintenance.” By basing this definition on the cost of the plant rather than on how much pollution is created, the new definition effectively exempts plants from having to install or upgrade their emissions reduction equipment.

In 2005, two big actions further complicated efforts to fight these rollbacks as legal actions continue:

• In June, the District Court of the District of Columbia dismissed key industry arguments, while upholding others. The Court rejected industry arguments that only if they increase their capacity to pollute should they face new source review. The Court said increases in actual pollution—regardless of increases to their production capacity—trigger new source review. Unfortunately, the Court did allow the change that gave industry the opportunity to “cherry pick” the worst two years of the last decade to compare their emissions against when evaluating pollution production.
• In October, EPA announced yet more rollbacks, based on arguments that, ironically, the Agency had rejected when the electric utility industry made the same claims in court three years earlier. Despite its own legal counsel’s opposition,⁸ EPA threw in the towel, and applied this argument to all NSR cases, further weakening each.⁹ EPA’s decision will allow electric utilities to increase the annual amount of pollution they emit without having to install new pollution control measures. EPA would require new clean up equipment only if the plants produced more pollution per hour, regardless of how much total pollution they produced. EPA’s own lawyers argued against this argument when industry had made it originally in 2002.¹⁰

If you live in an area with unhealthy air quality, and are downwind from an old coal-fired power plant, the changes to NSR mean that plant can continue to pollute the air you and your family breathe for decades. With EPA’s changes, polluters are allowed to keep polluting your air at the same rate for 10 years past the time they made their last upgrade, and they could increase their pollution—all under the “watchful” eye of EPA.

In response to EPA’s crippling changes to NSR, the American Lung Association and six environmental groups sued the Agency in 2003. In addition, the attorneys general of 14 states and the District of Columbia also sued to return the teeth to the NSR process. The Lung Association will continue to fight to restore these protections, despite the Department of Justice’s decision to no longer enforce NSR cases against electric utilities. As reported in the media in mid-February 2006, the Administration has shifted its efforts away from this industry, clearly the largest industrial source of air pollution, and toward other industries.¹¹

Our legal challenges resulted in a decision by the U.S. Court of Appeals for the District of Columbia in March 2006 that told EPA that one of the most egregious rule changes was, in fact, illegal. The Court overturned EPA’s proposal to broadly define and exempt activities broadly defined as “routine maintenance” from having to comply with the NSR provisions. The Court ruled that Congress clearly meant that NSR apply to any modification that increases pollution, the position that the Lung Association and our allies had argued.¹²

If it is fully and properly enforced, the existing Clean Air Act will require major air pollution reductions from power plants. If Congress considers legislation to require further reductions, the American Lung Association supports an approach that curbs emissions of all the major power plant pollutants. The Clean Power Act (S. 150), introduced by Sens. James Jeffords (I-VT), Susan Collins (RME) and Joseph Lieberman (D-CT) takes just such an approach. S. 150 preserves key Clean Air Act provisions, but targets levels of power plant pollutants that must be reduced. It provides a coordinated approach for all four major power plant pollutants—sulfur  dioxide, nitrogen oxides, mercury and carbon dioxide—within six years. These components of the legislation would ensure that power plants become cleaner and local air quality is protected.

Pressure continues to weaken the Clean Air Act
Unfortunately, the Clear Skies Initiative (S. 131) remains the focus of the Administration’s plan for power plants. Congressional debate on this proposal makes the Clean Air Act more vulnerable than at any time since 1990. Although a bipartisan group of senators stopped the Clear Skies bill in committee in its first attempt at passage, the Administration and the bill’s sponsors are committed to getting it enacted into law.

This Administration proposal purports to cut pollution from power plants but, in reality, would be less protective than enforcing the existing Clean Air Act, delaying and reducing cuts in sulfur dioxide, nitrogen oxides and mercury pollution. Introduced on behalf of the Administration by Sen. Jim Inhofe (R-OK), S. 131 would roll back existing requirements while permitting more pollution to continue for decades longer. Specific evidence that the Administration proposal allows more pollution than current requirements of the Clean Air Act are found in comparing the two approaches, using EPA’s own internal assessments:¹³

Current law under the Clean Air Act requires deep reductions in power plants’ sulfur and nitrogen emissions within this decade in order to meet public health standards by 2010.

The Administration’s weaker air plan (S. 131) allows utilities and refineries to postpone installing pollution control measures for a decade or longer, allowing unhealthful levels of ozone and particle pollution to continue until 2022, denying tens of millions of people healthy air. In addition, this proposal repeals requirements to clean up pollution for utilities, industrial sources and transportation sources that Congress adopted in 1990.

The bill allows much more pollution to continue for much longer than the Clean Air Act by allowing:

• Utilities to produce twice as much sulfur dioxide (SO₂) for nearly a decade longer (2010-2017); one-and-a-half times more SO₂ in 2018 and after. Much of the particle pollution in the Eastern United States comes from these emissions.
• Utilities to produce more than one and a half times as much nitrogen oxides (NO_X) for nearly a decade longer (2010-2017); one-third more NO_X in 2018 and after. NO_X helps make ozone in the atmosphere.
• Full pollution reductions to be further delayed—until after 2025 according to EPA—due to emissions “banking.”

The bill also repeals key provisions of the Clean Air Act:

• No longer would local governments be able to require state-of-the-art pollution controls in new plants of any type or in any older plants that were increasing their pollution when they rebuild or expand their facilities.
• No longer could states located downwind of other states and suffering from the pollution created by power plants in those states take legal action to protect their citizens. Under the Clean Air Act, states can take legal action to effectively require those plants to reduce pollution. Revoking that provision would remove the chief tool the Northeast states used effectively to tackle pollution from Midwest and southern power plants.
• Even our national parks and wilderness areas would be threatened by more pollution under the Administration proposal. It would repeal clean up requirements for existing sources, while weakening Clean Air Act safeguards built in for these protected lands.

Weaker requirements, more pollution, more loopholes for polluters, tying the hands of states to clean up pollution—all reasons that the American Lung Association opposes S. 131. Strict enforcement of the Clean Air Act itself has repeatedly proven to be the way to reduce power plant emissions successfully.