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EPA Greenhouse Gas Limits Face Appeals Court Challenge Over Public Danger

By Tom Schoenberg and Mark Drajem
 
The U.S. Environmental Protection Agency’s limits on vehicle and industrial emissions of greenhouse gases including carbon dioxide are being scrutinized by U.S. judges as a two-day court hearing began in Washington.
 
The three-judge panel of the U.S. Court of Appeals is considering challenges to the agency’s finding that greenhouse gases are pollutants that endanger human health, and to rules determining when states and industries must comply with regulations curtailing their use.
 
Companies such as Massey Energy Co., business groups including the U.S. Chamber of Commerce and states led by Texas and Virginia are seeking to stop the agency through more than 60 lawsuits. They argue that the agency relied on biased data from outside scientists, including some affiliated with the so-called climategate scandal.
 
“Everything flows from the endangerment finding,” said Robert Brenner, a senior fellow at the Nicholas Institute at Duke University and a former EPA official. Overturning that determination “will be the most difficult for the industry to get a finding from the court.”
 
In 2007, the Supreme Court ruled that the EPA had authority to regulate greenhouse gases such as carbon dioxide and methane under the Clean Air Act if the agency declared them a public danger. The EPA issued a so-called endangerment finding in December 2009, clearing the way for regulation of emissions from power plants, factories and other sources linked to global climate change.
 
Judges on Panel
 
Two of the judges hearing the case presided over a 2003 lawsuit in which 12 states tried to force the administration of then-President George W. Bush to regulate carbon dioxide and other greenhouse-gas emissions on new cars and trucks.
 
U.S. Circuit Judge David Sentelle, appointed to the court by President Ronald Reagan, a Republican, joined the majority in a 2-1 decision that found the EPA has broad discretion to determine whether to set limits on pollutants.
 
U.S. Circuit Judge David Tatel, appointed by President Bill Clinton, a Democrat, issued a 38-page dissent saying the EPA not only has the authority to regulate gases that cause global warming, it has a responsibility to do so if the director finds they endanger public health or welfare.
 
The third judge is U.S. Circuit Judge Judith Rogers, also appointed to the bench by Clinton. Rogers was part of a panel of judges that in December ordered the EPA’s interstate air pollution rule be put on hold while the court considers its legality.
 
The arguments have been split into three parts. The panel today heard arguments on the endangerment finding and challenges to a 2010 rule on emissions from motor vehicles that opponents said improperly sets greenhouse-gas standards for stationary sources, such as steel mills and power plants.
 
‘Tailoring Rule’
 
Tomorrow, the court will consider challenges to the EPA’s “tailoring rule,” which limits the businesses covered by carbon regulation and phases in controls.
 
The agency aims to phase in industrial polluters covered by the carbon rules through 2016. Imposing restrictions all at once and without exceptions would be “absurd,” EPA Administrator Lisa Jackson has said.
 
The EPA argued in court filings that the tailoring rule is acceptable under the Clean Air Act and necessary to avoid states being overrun with permit requests.
 
The “EPA determined that by phasing in the statutory thresholds, it could almost immediately achieve most of the emissions benefits that would result from strict adherence” to the standards “while avoiding the permit gridlock that unquestionably would result from immediate application of that threshold,” the agency said in a Dec. 14 filing.
 
Biggest Emitters
 
The regulations require only the biggest emitters, such as power plants and oil refiners, obtain state carbon permits before building or upgrading facilities. State officials will determine pollution controls case by case.
 
“A lot of the focus has been on endangerment, but that is going to be an uphill battle” for industry, said Jeffrey Holmstead, a lawyer at Bracewell & Giuliani LLP (1222L) in Washington who isn’t involved in the case. “The biggest vulnerability for EPA is on the tailoring rule.”
 
If the EPA loses on that it would create such chaos that “it forces Congress to act,” said Holmstead, who was an EPA official during the George W. Bush administration.
 
Peabody Energy Corp. (BTU), the largest U.S. coal producer, said in a September 2010 filing that the EPA’s rules “will implement the most extensive, far-reaching and burdensome regulatory regime in the 40-year history of the agency.”
 
Virginia, Texas
 
Virginia and Texas said the endangerment finding should be rejected because the EPA refused to reconsider its decision after learning that some of the data it relied on may have been “manipulated,” referring to findings by the United Nations Intergovernmental Panel on Climate Change.
 
The states, citing an EPA inspector general’s report, claim the agency improperly used data from outside groups without testing its veracity.
 
Panels of the National Oceanic and Atmospheric Administration and National Science Foundation cleared U.S. scientists who had their e-mails pilfered from the server of the climate-research unit University of East Anglia, based in Norwich, England.
 
The university’s work contributed to some of the key findings of the U.N. Intergovernmental Panel on Climate Change, which has issued reports that blame rising temperatures on human activity.
 
The e-mails, dating back as far as 1996, have been cited by skeptics of human contribution to global warming as evidence of a conspiracy to manipulate data to support research. One e-mail referred to a “nature trick” to hide signs of a decline in temperatures.
 
Inspector General Report
 
The EPA’s inspector general, in a report made public on Sept. 28, said the agency failed to follow all of its required procedures when deciding that greenhouse gases pose a danger to the public.
 
An EPA employee sat on a 12-member scientific panel that reviewed the technical analysis of the issue, and the committee’s recommendations weren’t made public, according to the report.
 
The report didn’t question the scientific studies behind the determination, and the White House Office of Management and Budget, which established the process, disagreed with the inspector general’s conclusions.
 
The case is Coalition for Responsible Regulation Inc. v. Environmental Protection Agency, 09-1322, U.S. Court of Appeals, District of Columbia (Washington).