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High Court Utility MACT Win For EPA Might Not End Fight On Emission Limitations
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A possible EPA victory in a pending Supreme Court case over the MATS rule for power plants might still not resolve legal uncertainty over the utility rule and other air toxics standards because the regulations share a contested method for setting emissions limits that is still being litigated in federal appeals court.  The method, known as the upper prediction limit (UPL), has prompted attacks from environmentalists who say it has flaws that lead to air toxics limits that are too weak.  


While the UPL is not at issue in the imminent high court decision on the utility MACT, it is a live issue in the consolidated litigation over EPA's MACT for industrial boilers.  In the combustion rules EPA used a 99 percent UPL, which the agency says estimates the average performance of the top 12 percent of sources for 99 percent of the time sources are operating, in order to better predict real-world performance. The agency used the same approach in the utility MACT.


Even if the justices decide to uphold MATS, that might not resolve the rule's fate because an adverse U.S. Court of Appeals for the District of Columbia Circuit vacating or remanding the UPL method to EPA could spur calls to revise the utility MACT.  If the D.C. Circuit agrees with advocates that the UPL is unlawful, EPA could be forced to recalculate MACT floors in the boiler MACT, utility MACT, and other emissions standards.  However, when the D.C. Circuit issued its 2-1 ruling from April in White Stallion Energy Center v. EPA, et al. upholding the utility MACT, it did not find fault with the use of the UPL in how EPA calculated the MACT floors.


The D.C. Circuit is due to hold oral arguments during its next term, which begins in the fall, in litigation over the package of three combustion air rules limiting emissions from large "major" industrial, commercial and institutional (ICI) boilers, smaller "area" source boilers, and commercial and industrial solid waste incinerators (CISWI).  Underlying all these pending appellate cases is a challenge by environmentalists to the UPL, which EPA says accounts for variability in boiler or incinerator performance.  The UPL attempts to account for discrepancies among the three test runs emissions sources are required to conduct.  The method helps to more accurately predict the future performance of the source, and is widely employed in other fields, EPA told the D.C. Circuit in a memo last year.


The D.C. Circuit has considered EPA's use of the UPL before, remanding a sewage sludge incinerator air toxics rule to EPA in a 2013 ruling seeking further explanation of the method in the rulemaking in its unanimous decision in National Association of Clean Water Agencies (NACWA) v. EPA.  The agency responded with the memo last year from Stephen Page, director of EPA's Office of Air Quality Planning and Standards, defending the method as a reasonable and lawful approach.


In the boiler and CISWI litigation, EPA voluntarily remanded its emissions limits briefly in order to respond to the D.C. Circuit's remand in NACWA, and is still reconsidering some limits that are based on nine or fewer data points.  The agency said that it would re-examine those data points in the light of possible shortcomings that could arise from insufficient data to properly apply the UPL method in its rules.  EPA has indicated that it intends to address the remand of MACT emissions limits in its reconsideration of parts of the boiler rules, which the industry source says is now expected in September or October.

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