Tailoring Rule Draws Multiple Challenges

by Victor Flatt

August 04, 2010

Cross-posted from Flatt Out Environmental.

As expected, the EPA's "tailoring rule," under which it proposes to regulate stationary sources of greenhouse gases under the Clean Air Act (CAA) only if they produce over 75,000 tons of carbon dioxide equivalent forcing per year, has been challenged in court by numerous organizations. These include industry, several states (the usual suspects including Texas), and more surprisingly several environmental organizations.

The crux of industry and state challenges to the tailoring rule is that it is illegal pure and simple. Specifically, the challenges note that the CAA requires that when the EPA regulates stationary sources under the CAA, that it do so for sources that emit over either 100 or 250 tons per year. Of course, industry doesn't really want all of these smaller sources regulated, but they want to make it virtually impossible for EPA to regulate at all. If the EPA had to regulate all of these small sources, regulation would be virtually impossible. (EPA's primary argument for the legality of the tailoring rule is a doctrine known as "administrative impossibility"). Even if the EPA tried to, Congress would surely take action then to suspend the regulation (something that it has not been able to do so far, though several Senators have tried).

The environmental organizations take the other tack, claiming that while they don't oppose "tailoring" out small sources, that the level is not small enough. (They prefer 25,000 tons per year).

In Texas's letter explaining its position, it goes further and eschews the EPA's interpretation that greenhouse gases are now "subject to regulation," and declares that the state of Texas will not regulate. Though the letter puts up some straw men in the argument about the fact that Texas can't regulate greenhouse gases because the state definition of "subject to regulation" doesn't include greenhouse gases, the bottom line is that Texas, like all other states with delegated programs, must comport its State Implementation Plan (or SIP) to the EPA's definitions or be subject to withdrawal of authority. Of course, Texas is already subject to having its authority withdrawn so I suppose it has nothing to lose, but it shouldn't pretend that states administering the CAA aren't required to comport with the EPA's definitions. (I would also point out that regardless of the tailoring rule's fate, most agree that the definition of "subject to regulation" will include greenhouse gases after the EPA starts regulating them in January 2011 (pursuant to Supreme Court directive) and that this interpretation does not have to go through formal notice and comment, as Texas should well know.)

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Also from Victor Flatt

Victor B. Flatt is the  Dwight Olds Chair and Faculty Director of the Environment, Energy and Natural Resources Center, University of Houston Law Center, and a Distinguished Scholar, Global Energy Management Institute at the University of Houston.

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