Clean Air Issues in the 111th Congress
Congressional research reportDec 7, 2010
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Clean Air Issues in the 111th Congress
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Specialist in Environmental Policy
December 7, 2010
Congressional Research Service
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R40145
CRS Report for Congress
Prepared for Members and Committees of Congress
Clean Air Issues in the 111th Congress
Summary
EPA regulatory actions on greenhouse gas (GHG) emissions using existing Clean Air Act
authority have been the main focus of congressional interest in clean air issues in recent months.
Although the agency and the Obama Administration have consistently said that they would prefer
that Congress pass legislation to address climate change, EPA has begun to develop regulations
using its existing authority. On December 15, 2009, the agency finalized an “endangerment
finding” under Section 202 of the Clean Air Act, which permits it (in fact, requires it) to regulate
pollutants for their effect as greenhouse gases for the first time. Relying on this finding, EPA
finalized GHG emission standards for cars and light trucks, April 1, 2010. The implementation of
these standards will, in turn, trigger permitting requirements and the imposition of Best Available
Control Technology for new major stationary sources of GHGs in January 2011.
It is the triggering of standards for stationary sources (power plants, manufacturing facilities, etc.)
that has raised the most concern in Congress: legislation has been introduced in both the House
and Senate aimed at preventing EPA from implementing these requirements. The legislation has
taken several forms, including the introduction of resolutions of disapproval for the endangerment
finding itself under the Congressional Review Act, and stand-alone legislation that would
forestall specific EPA regulatory actions. Meanwhile, EPA has itself promulgated regulations and
guidance that will limit the applicability of Clean Air Act GHG requirements, delaying the
applicability of requirements for all stationary sources until 2011 through guidance published
April 2, 2010, and focusing its regulatory efforts on the largest emitters while granting smaller
sources at least a six-year reprieve through what it calls the Greenhouse Gas “Tailoring Rule.”
The endangerment finding and EPA’s other actions, which were triggered by a 2007 Supreme
Court decision, came as Congress struggled with climate change and energy legislation. On June
26, 2009, the House narrowly passed H.R. 2454, a 1,428-page bill addressing a number of
interrelated energy and climate change issues. The bill would have established a cap-and-trade
program for greenhouse gas (GHG) emissions, beginning in 2012. In the Senate, both the
Environment and Public Works Committee and the Energy and Natural Resources Committee
reported bills (S. 1733 and S. 1462), but action subsequently bogged down, while a trio of
Senators began negotiating a climate bill from scratch. As the clock wound down on the 111th
Congress, it became less likely that climate legislation would be enacted, and more likely that
EPA’s actions would be the principal U.S. response to climate issues for now.
Besides addressing climate change, EPA has taken action on a number of conventional air
pollutants, generally in response to the courts. Several Bush Administration regulatory decisions
were vacated or remanded to the agency: among them, the Clean Air Interstate Rule (CAIR)—a
rule designed to control the long-range transport of sulfur dioxide and nitrogen oxides from
power plants, by establishing a cap-and-trade program—and the Clean Air Mercury Rule, which
would have established a cap-and-trade program for power plant mercury emissions. EPA will
address these court decisions through new regulations—the agency proposed a replacement for
CAIR July 6. Some in Congress have wanted to address these issues through legislation, an
approach that might reduce the likelihood of further court challenges. The agency is also in the
midst of reviewing ambient air quality standards for the six most widespread air pollutants. These
standards serve as EPA’s definition of clean air, and drive a wide range of regulatory controls.
This report provides an overview of clean air legislative and regulatory issues. More detailed
information on most of the issues can be found in other CRS reports, which are referenced
throughout this report.
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Clean Air Issues in the 111th Congress
Contents
Introduction ................................................................................................................................1
EPA’s Greenhouse Gas Regulations .............................................................................................2
Legislation on Climate Change....................................................................................................4
Legislative and Regulatory Issues .........................................................................................5
Cap-and-Trade ................................................................................................................6
GHG Emission Standards................................................................................................7
HFC Cap-and-Trade........................................................................................................7
Removal of Existing EPA Authorities ..............................................................................8
Agricultural Sources of Emissions...................................................................................9
International Offsets........................................................................................................9
Tariff Provisions ........................................................................................................... 10
State Preemption ........................................................................................................... 10
Cost of the Bill.............................................................................................................. 11
Experience with Other Cap-and-Trade Systems ............................................................. 12
Emissions from Power Plants .................................................................................................... 13
Clean Air Interstate Rule (CAIR) ........................................................................................ 14
North Carolina v. EPA................................................................................................... 14
Effects of the Decision .................................................................................................. 15
EPA’s CAIR Replacement: The Clean Air Transport Rule.............................................. 16
Judicial and Legislative Options.................................................................................... 17
Clean Air Mercury Rule (CAMR) ....................................................................................... 18
Background .................................................................................................................. 18
New Jersey v. EPA......................................................................................................... 18
Other Mercury Issues .................................................................................................... 19
Next Steps..................................................................................................................... 19
New Source Review............................................................................................................ 20
Air Quality Standards................................................................................................................ 23
Background .................................................................................................................. 23
Judicial Reviews ........................................................................................................... 27
CASAC’s Role.............................................................................................................. 27
Adequacy of Monitoring ............................................................................................... 27
NAAQS Implementation............................................................................................... 28
Tables
Table 1. Status of NAAQS Reviews .......................................................................................... 24
Contacts
Author Contact Information ...................................................................................................... 28
Congressional Research Service
Clean Air Issues in the 111th Congress
Introduction
EPA regulatory actions to limit greenhouse gas (GHG) emissions using existing Clean Air Act
authority have been the major focus of congressional interest in clean air issues in recent months.
Members and Senators from both sides of the aisle have expressed concern that EPA is
proceeding with regulations that could have major economic impacts without direct congressional
authorization, and/or that EPA should delay taking such action until Congress specifically
authorizes it.
The Administration counters that it would prefer for Congress to pass new legislation to control
greenhouse gas emissions, but the Clean Air Act already requires action: a 2007 Supreme Court
decision interpreting that authority found that EPA must weigh whether GHG emissions endanger
public health and welfare and, if it concludes that they do, proceed with regulation.
The 111th Congress struggled to produce its own approach to climate change. On June 26, 2009,
the House narrowly passed H.R. 2454, a 1,428-page bill addressing a number of interrelated
energy and climate change issues. Among its numerous provisions, the bill would have
established cap-and-trade programs for GHG emissions, beginning in 2012. The Senate did not
act; however, two Senate committees reported bills,1 but the prospect of obtaining 60 votes for
either bill appeared slim, and neither came to the floor. Given these prospects, a trio of Senators
began negotiating a climate bill from scratch, but they also encountered difficulty: the process
ultimately lost its Republican sponsor and did not produce an introduced bill. Toward the end of
the second session, there was talk of a slimmed-down bill focusing on energy and perhaps electric
utilities, but even this limited approach did not come to the floor.
Besides legislation and potential EPA regulation of greenhouse gases, a bipartisan group of
Senators and EPA both considered addressing issues related to sulfur dioxide (SO2), nitrogen
oxides (NOx), and mercury emissions from electric power plants. Regulations addressing these
emissions were vacated by the D.C. Circuit Court of Appeals in 2008, leaving major potential
gaps in EPA and state regulations. EPA is developing new regulations to address the court’s
concerns and proposed regulations addressing SO2 and NOx, July 6,2010, but legislation might
provide a more straightforward solution, resolving ambiguities in current law and reducing the
likelihood of further delays from litigation. S. 2995, a bipartisan bill addressing these issues, was
introduced in the Senate and hearings were held, but no further action was taken.
The Obama Administration’s EPA has also moved to reconsider or modify several Bush
Administration decisions regarding national ambient air quality standards (NAAQS). NAAQS
represent EPA’s formal judgment regarding how clean the air must be to protect public health and
welfare; the standards set in motion monitoring and planning requirements, which in turn lead to
emission controls.
•
On January 19, 2010, the agency proposed a more stringent NAAQS for ozone,
having concluded that a 2008 revision to the standard did not satisfy the
requirements of the Clean Air Act. The revision could affect as many as 650
counties—virtually every county that currently has an ozone monitor. Final
action on this proposal is expected by the end of December.
1
The Environment and Public Works Committee reported S. 1733, and the Energy and Natural Resources Committee
reported S. 1462.
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•
On June 22, 2010, the agency promulgated revisions to the NAAQS for SO2; 59
counties would violate the new SO2 standard, based on the most recent
monitoring data.2 None violated the old standard.
•
The agency is also reviewing or has recently completed reviews of the NAAQS
for four other pollutants, notably particulates, which are emitted by a wide range
of mobile and stationary sources. A revised particulate standard is to be proposed
by February 2011. Early indications are that the agency may propose
substantially more stringent standards.3
This report provides a brief overview of the climate change, power plant, and air quality standard
issues. More detailed information on most of the issues can be found in other CRS reports, which
are referenced throughout this report.
EPA’s Greenhouse Gas Regulations
EPA’s actions to regulate GHG emissions stem from more than a decade of petitions and
litigation. Responding to a 1999 petition that it regulate greenhouse gases from new motor
vehicles, the agency in 2003 denied that it had such authority, arguing that GHGs did not fall
within the Clean Air Act’s definition of “air pollutants.” The denial was challenged by
Massachusetts, 11 other states, and various other petitioners in a case that ultimately reached the
Supreme Court. In an April 2, 2007, decision (Massachusetts v. EPA), the Court found by 5-4 that
EPA does have authority to regulate greenhouse gas emissions, since the emissions are clearly air
pollutants under the Clean Air Act’s definition of that term.4 The Court’s majority concluded that
EPA must, therefore, decide whether emissions of these pollutants from new motor vehicles
contribute to air pollution that may reasonably be anticipated to endanger public health or
welfare. When it makes such an “endangerment finding,” the act requires the agency to establish
standards for emissions of the pollutants.
On December 15, 2009, acting in response to the Court’s decision, EPA finalized an
endangerment finding for greenhouse gas emissions from motor vehicles, under Section 202(a) of
the act.5 Relying on this finding, EPA promulgated GHG emission standards for new cars and
2
The number of counties that will be formally designated nonattainment is likely to be different from the 59 EPA
identified, for two reasons. First, EPA promulgated changes to the monitoring requirements along with the new
standard. Second, the actual designations will most likely be made based on 2009-2011 monitoring data, whereas the
59 counties were identified using 2007-2009 data.
3
On July 2, 2010, EPA released the Second External Review Draft of its Policy Assessment for the Review of the
Particulate Matter NAAQS. The draft represented EPA staff’s recommendations to the Administrator. It outlined
options for revising both the fine and coarse particulate standard, both of which would make the standards more
stringent. The draft is available at http://www.epa.gov/ttn/naaqs/standards/pm/s_pm_2007_pa.html. Information on the
status of all of the NAAQS revisions can be found below in the section of this report entitled “Air Quality Standards.”
4
Massachusetts v. EPA, 549 U.S. 497 (2007). The majority held: “The Clean Air Act’s sweeping definition of ‘air
pollutant’ includes ‘any air pollution agent or combination of such agents, including any physical, chemical ...
substance or matter which is emitted into or otherwise enters the ambient air.... ‘ ... Carbon dioxide, methane, nitrous
oxide, and hydrofluorocarbons are without a doubt ‘physical [and] chemical ... substances[s] which [are] emitted into ...
the ambient air.’ The statute is unambiguous.”
5
74 Federal Register 66496. While generally referred to as the “endangerment finding” (singular), the Federal
Register notice consists of two separate findings: a Finding that Emissions of Greenhouse Gases Endanger Public
Health and Welfare, and a Finding that Greenhouse Gases From Motor Vehicles Cause or Contribute to the
Endangerment of Public Health and Welfare.
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light trucks, April 1, 2010. The implementation of these standards will, in turn, trigger permitting
requirements and the imposition of Best Available Control Technology for new major stationary
sources of GHGs beginning in 2011. (For information on these regulations and permit
requirements, see CRS Report R40506, Cars, Trucks, and Climate: EPA Regulation of
Greenhouse Gases from Mobile Sources, and CRS Report R41212, EPA Regulation of
Greenhouse Gases: Congressional Responses and Options.)
The prospect of GHG standards for motor vehicles is not particularly controversial. On May 19,
2009, President Obama announced an agreement involving nine U.S. and foreign auto
manufacturers; the federal government; the governors of California, Michigan, and
Massachusetts; the United Auto Workers; and environmental groups under which EPA and the
National Highway Traffic Safety Administration (NHTSA) would proceed with a joint
rulemaking in which GHG emissions from new motor vehicles would be reduced under the Clean
Air Act, while NHTSA would set corresponding fuel economy standards under the Corporate
Average Fuel Economy (CAFE) program.6 The objective of the new greenhouse gas standards is
to reach reduction levels similar to those adopted by the state of California and 13 other states,
who will harmonize their standards with those of EPA as part of the agreement. The California
standards required about a 30% reduction in GHG emissions from new vehicles by 2016. The
auto industry supported the national agreement, in part, to avoid having to meet standards on a
state-by-state basis; thus, it is not interested in seeing EPA’s motor vehicle GHG standards
blocked.
In addition to the motor vehicle GHG standards, EPA has received petitions asking the agency to
regulate GHGs from a variety of other sources, including coal mines, concentrated animal feeding
operations (CAFOs), aircraft, ocean-going ships, nonroad engines and equipment (e.g.,
construction equipment, farm equipment, recreational equipment, forklifts, harbor craft, and lawn
and garden equipment), and fuels. Another petition asks the agency to set National Ambient Air
Quality Standards for seven specific greenhouse gases. The agency also faces lawsuits seeking to
force it to regulate GHGs from stationary sources, including power plants, petroleum refineries,
nonroad vehicles and engines, and the Portland cement industry. The decision to move forward on
GHG standards for new motor vehicles is seen by many as a precedent for regulation of these
other sources. 7
Even without EPA decisions on these petitions or the conclusion of lawsuits, the adoption of
GHG standards for motor vehicles will trigger GHG permit requirements for new stationary
sources, as a result of language in Section 165 of the act that requires such permits to require best
available control technology for all pollutants “subject to regulation” under the act. It is this
triggering of standards for stationary sources (power plants, manufacturing facilities, and others)
that appears to have raised the most concern in Congress: legislation has been introduced in both
6
The President’s announcement and related documents, including a Notice of Upcoming Joint Rulemaking to Establish
Vehicle GHG Emissions and CAFE Standards, which appeared in the May 22, 2009 Federal Register, and both the
draft and final emission standards can be found at http://www.epa.gov/otaq/climate/regulations.htm. For additional
information, see CRS Report R40166, Automobile and Light Truck Fuel Economy: The CAFE Standards, by (name red
acted) and (name redacted) or CRS Report R40506,
Cars, Trucks, and Climate: EPA Regulation of Greenhouse
Gases from Mobile Sources, by (name redacted).
7
For a further discussion of these issues, see CRS Report R40984, Legal Consequences of EPA’s Endangerment
Finding for New Motor Vehicle Greenhouse Gas Emissions, by (name redacted), CRS Report R40506,
Cars, Trucks, and
Climate: EPA Regulation of Greenhouse Gases from Mobile Sources, by (name redacted), and CRS Report R40585,
Climate Change: Potential Regulation of Stationary Greenhouse Gas Sources Under the Clean Air Act, by (name
redacted) and (name redacted).
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the House and Senate aimed at preventing EPA from implementing these requirements. The
legislation has taken several forms, including the introduction of resolutions of disapproval for
the endangerment finding itself under the Congressional Review Act (S.J.Res. 26, H.J.Res. 66,
H.J.Res. 76, and H.J.Res. 77), and five other bills that would either require EPA to reevaluate its
endangerment finding (H.Res. 974), amend the Clean Air Act to provide that greenhouse gases
are not subject to the act (H.R. 4396), limit EPA’s GHG authority to motor vehicle emissions (S.
1622), or suspend EPA actions regulating stationary source emissions of GHGs for two years (S.
3072, H.R. 4753). S.J.Res. 26, Senator Murkowski’s resolution of disapproval for the
endangerment finding, was defeated 53-47, on June 10, 2010. Meanwhile, EPA has itself
promulgated regulations and guidance that would delay the applicability of requirements for
stationary sources of GHGs until 2011 and focus its initial regulatory efforts on the largest
emitters, granting smaller sources at least a six-year reprieve. 8
Although both the resolutions of disapproval and the stand-alone legislation to restrict EPA’s
authority have received a great deal of attention, the path to enactment of either of these forms of
legislation would be a steep one. The Obama Administration has made the reduction of GHG
emissions one of its major goals; as a result, many conclude that legislation restricting EPA’s
authority to act, if passed by Congress, would encounter a presidential veto.
Addressing the issue through an amendment to the EPA appropriation, by cutting EPA’s
appropriation or by restricting its authority to use funds to take specific GHG regulatory actions,
might have more chance of enactment. The overall appropriation bill to which it would be
attached would presumably contain other elements that would make it more difficult to veto. This
approach was discussed at some length in the fall of 2009, when Senator Murkowski introduced
(but ultimately did not offer) S.Amdt. 2530 to the Interior, Environment, and Related Agencies
Appropriation Act (H.R. 2996).
In short, there are numerous ways that Congress can address EPA’s greenhouse gas authority, and
opponents of EPA action may continue to exert pressure to delay or limit the agency’s actions, as
the agency continues on its planned course. (For a more detailed discussion of EPA’s regulatory
actions and potential congressional responses, see CRS Report R41212, EPA Regulation of
Greenhouse Gases: Congressional Responses and Options, by (name redacted) and (name
redacted).)
Legislation on Climate Change
On June 26, 2009, by a vote of 219-212, the House passed H.R. 2454, the American Clean
Energy and Security Act of 2009. The bill, also referred to by its acronym (ACES) or as the
Waxman-Markey bill, addresses a number of interrelated energy and climate change issues. The
Senate Energy and Natural Resources Committee and the Senate Environment and Public Works
Committee reported Senate counterparts: S. 1462 (Bingaman), equivalent to the energy titles, and
S. 1733, the Kerry-Boxer bill, establishing a cap-and-trade system and other measures to address
climate change. The Kerry-Boxer bill faced strong opposition, however. The Republican
8
EPA has promulgated two rules that would have these effects: “Prevention of Significant Deterioration and Title V
Greenhouse Gas Tailoring Rule,” final rule, 75 Federal Register 31514, June 3, 2010; and “Reconsideration of
Interpretation of Regulations that Determine Pollutants Covered by Clean Air Act Permitting Programs,” final rule, 75
Federal Register 17004, April 2, 2010.
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members of the Environment and Public Works Committee boycotted the markup. The bill was
reported with no Republican support and less than unanimous support among Democrats: it was
clear that the bill would lack the 60 votes necessary to overcome a filibuster and secure passage
on the floor. As a result, negotiations took place among a trio of Senators (Kerry, Graham, and
Lieberman) for a bipartisan (or, more accurately, tripartisan) alternative. This legislation, without
Senator Graham’s sponsorship, circulated extensively in draft form in 2010, but was not
introduced.
Controlling greenhouse gas emissions was among the highest priorities of the congressional
leadership and the Obama Administration in the 111th Congress. It would have been addressed in
the ACES legislation in a number of ways, many of which would have amended the Clean Air
Act. The remainder of the climate portion of this report discusses the House bill and the issues
that arose in the course of its consideration, with occasional references to developments in the
Senate.
The House bill would have amended the Clean Air Act to establish a cap-and-trade program9
(similar to the act’s current program for addressing acid rain) to limit greenhouse gas (GHG)
emissions beginning in 2012.10 The emissions cap on covered sources would have gradually
declined—from 3% below the 2005 emissions level in 2012 to 83% below in 2050. In addition to
the cap-and-trade program, the bill would have established renewable energy and energy
efficiency requirements, mandated carbon capture and sequestration by new coal-fired electric
generating units, and required EPA to set GHG emission standards for various sources. The bill
distributed the cap-and-trade program’s emission allowances to a wide array of sectors in an
effort to address potential impacts on low income households and protect industries that might be
subject to import competition from countries with less stringent GHG requirements, and it
encouraged the use of “offsets” (emission reductions in sectors not directly covered by the capand-trade program). The cap-and-trade program in S. 1733 was similar.11
Legislative and Regulatory Issues
In an earlier version of this report, we discussed five broad issues that climate legislation would
need to address: (1) how a new program regulating greenhouse gas emissions would relate to the
Clean Air Act, which gives EPA broad authority to set standards for air pollutants—potentially
including GHGs; (2) whether legislation would focus on individual sectors of the economy, the
economy as a whole, or both; (3) whether a cap-and-trade system would be the best approach,
and, if it were chosen, the specifics of such a system:
•
the comprehensiveness of the program,
9
A cap-and-trade system sets a declining national cap on emissions and allocates emission allowances that can be
bought and sold on open markets. For additional information, CRS Report RL34513, Climate Change: Current Issues
and Policy Tools, by (name redacted).
10
Seven greenhouse gases were listed in Section 711 of the bill: carbon dioxide (CO2), methane (CH4), nitrous oxide
(N2O), sulfur hexafluoride (SF6), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and nitrogen trifluoride (NF3).
The EPA Administrator would have been given authority to designate additional gases. The bill also provided specific
authority to promulgate regulations for black carbon emissions.
11
For a summary and comparison of the House and Senate bills, see CRS Report R40896, Climate Change:
Comparison of the Cap-and-Trade Provisions in H.R. 2454 and S. 1733, by (name redacted), (name redacted),
and (name redacted).
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•
how allowances (which are essentially permits to emit GHGs) would be
distributed or sold,
•
how allowance price volatility might be addressed,
•
what measures would be taken to address potential effects on U.S. industries visa-vis foreign competitors, and
•
what role there might be for offsets (i.e., credit for emission reductions by
sources outside the cap-and-trade program);
(4) what role there would be for carbon taxes; and (5) what role there would be for state
programs—in particular, the degree to which a federal program might preempt state measures
affecting similar sources.
The Waxman-Markey bill, as passed by the House, addressed most of these issues. 12 It would
have both established an economy-wide cap-and-trade system and addressed individual sectors of
the economy and categories of emitters. In addition to capping GHG emissions, it set forth energy
efficiency and renewable energy requirements aimed at reducing the emissions of individual
sectors, notably electric utilities, cars and trucks, electrical appliances, and commercial or
government buildings. Together, these sectors account for the lion’s share of energy use and GHG
emissions. The bill would have amended the Clean Air Act to remove potential authority that EPA
has to regulate GHGs under several broadly worded sections of the existing statute, while
establishing new requirements that EPA set standards for specific emission sources. It would not
have established a carbon tax. In general, it would not have preempted state authority to set
standards for GHG emission sources, but it would have preempted state and regional cap-andtrade systems for the period 2012-2017.
S. 1733, reported by the Environment and Public Works Committee on February 2, 2010, had
similar provisions. The following sections discuss these provisions in more detail, as well as
issues that arose during floor debate on the House bill. 13
Cap-and-Trade
The House bill would have added a new Title VII to the act, in which an economy-wide cap-andtrade program for GHGs would have been established. The cap for GHG emissions from major
sources of emissions decreased 3% by 2012, 17% by 2020, 42% by 2030, and 83% by 2050,
compared to 2005 levels. As the cap (and hence, the number of allowances) was gradually
ratcheted down, markets would have determined who would reduce emissions: companies that
could do so at low cost would have incentives to take action; companies with fewer or more
costly options could buy allowances or offsets14 to cover excess emissions.
12
For a detailed summary of the Waxman-Markey bill, see CRS Report R40643, Greenhouse Gas Legislation:
Summary and Analysis of H.R. 2454 as Passed by the House of Representatives, coordinated by (name redacted) and (name
redacted).
13
CRS has several reports summarizing or comparing the House and Senate bills, the broadest of which are CRS
Report R40643, Greenhouse Gas Legislation: Summary and Analysis of H.R. 2454 as Passed by the House of
Representatives , coordinated by (name redacted) and (name redacted), and CRS Report R40896,
Climate Change:
Comparison of the Cap-and-Trade Provisions in H.R. 2454 and S. 1733, by (name redacted), (name redacted),
and (name redacted).
14
An offset is a measurable reduction, avoidance, or sequestration of GHG emissions from a source not covered by an
(continued...)
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GHG Emission Standards
In addition to the cap-and-trade system, the bill also would have added a new Title VIII to the act,
in which standards for specific sources of GHG emissions were addressed. Under Title VIII, EPA
would have been required to
•
set performance standards for CO2 removal from new coal-fired power plants—
50% removal for units initially permitted after January 1, 2009, and 65% for
units initially permitted after January 1, 2020. These standards would not have
taken effect until 2025, or four years after EPA determined that carbon capture
and sequestration technology had met criteria for commercialization specified in
the bill, whichever is earlier;
•
promulgate regulations within two years of enactment to minimize the risk of
atmospheric release of CO2 from geologic sequestration sites, and develop a
certification and permitting process for such sites;
•
promulgate GHG emission standards that reflect the greatest degree of emissions
reduction achievable for new heavy duty motor vehicles and engines, by
December 31, 2010;
•
promulgate GHG emission standards that reflect the greatest degree of emissions
reduction achievable for nonroad vehicles or engines, by December 31, 2012;
•
set New Source Performance Standards and corresponding regulations for
existing uncapped major sources of GHGs, generally within three years of the
date of enactment; and
•
report on black carbon emissions, including an inventory of sources and
identification of cost-effective control technologies, and, within two years of
enactment, either promulgate regulations to reduce emissions or find that existing
Clean Air Act regulations provide adequate control.
HFC Cap-and-Trade
The bill would also have amended Title VI of the Clean Air Act to establish a separate cap-andtrade program for hydrofluorocarbons, refrigerants used in air conditioning systems, which, with
one exception, have a global warming potential 1,000-15,000 times as great as CO2. HFC
production and imports would have been capped at 90% of baseline levels in 2012, and the cap
would have declined each year until it reached 15% of the baseline in 2033. The baseline amount
would have been the amount that EPA determined was the annual average consumed in the period
2004-2006, but not higher than 370 million tons of CO2 equivalent, nor less than 280 million
tons.
(...continued)
emission reduction program. Examples might include planting trees on previously non-forested lands, capturing
methane emissions from agricultural sources, or implementing an energy-efficiency project in a developing country
that has no GHG reduction program.
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Removal of Existing EPA Authorities
Among the more controversial aspects of H.R. 2454 was its removal of numerous potential
authorities under current law that the agency could use to control emissions of GHGs. Under the
Obama Administration, the authority EPA already possesses has taken on new significance. The
President is committed to addressing GHG emissions, and he can use existing Clean Air Act
authority in a number of ways to do so. For starters, the agency proposed on April 17, 2009, and
finalized December 15 an “endangerment finding” under Section 202(a) of the Clean Air Act.
This finding permits EPA to establish GHG emission standards for motor vehicles. On May 19,
2009, before finalizing the endangerment finding, the President announced that EPA would move
forward with the motor vehicle standards. EPA promulgated the standards April 1, 2010.
Implementation of the first limits is scheduled for the 2012 model year. EPA also proposed GHG
emission standards for medium- and heavy-duty trucks and engines, November 30, 2010.
In addition to the pending controls on cars and trucks, EPA has received nine additional petitions
to regulate GHG emissions from coal mines, concentrated animal feeding operations (CAFOs),
ships, non-road engines, aircraft, and fuels. Any of these petitions could prompt further agency
action. Another petition asks the agency to set National Ambient Air Quality Standards for seven
specific greenhouse gases. The agency also faces lawsuits seeking to force it to regulate GHGs
from stationary sources, including power plants, petroleum refineries, and the Portland cement
industry. The decisions on motor vehicle standards are likely to serve as precedents for some of
the other decisions, and may have implications for the agency’s position in the pending litigation.
During the Bush Administration, some groups, including EPA, four Cabinet departments, and the
Office of Management and Budget, expressed concern that proceeding with GHG standards for
motor vehicles would activate numerous other Clean Air Act provisions.15 Addressing these
concerns, H.R. 2454 would have prevented EPA from setting National Ambient Air Quality
Standards for GHGs solely on the basis of their effect on global climate change. It would have
prohibited the agency from regulating GHGs under Section 115’s provisions for international air
pollution. It would have prohibited regulation of GHGs as hazardous air pollutants under Section
112. It would have prohibited the use of New Source Review to regulate GHG emissions under
the Prevention of Significant Deterioration (PSD) program. And no stationary source of GHGs
would have been required to obtain a permit under Title V of the act solely because of its GHG
emissions. Of these, only the two permit provisions (PSD-NSR, and Title V) have been invoked
by EPA, thus far, and the agency has taken steps to limit their applicability.16 The other authorities
seem, for the most part, ill-designed to address GHG emissions.17 Nevertheless, advocates of
15
See U.S. EPA, “Regulating Greenhouse Gas Emissions Under the Clean Air Act,” Advance Notice of Proposed
Rulemaking, 73 Federal Register 44354, July 30, 2008.
16
EPA shares congressional concerns about the potentially broad scope of the permit requirements, primarily because a
literal reading of the act might require as many as 6 million stationary sources to obtain permits. Thus, on June 3, 2010,
the agency promulgated a “Tailoring Rule” so that it can focus its resources on the largest emitters while deciding over
a six-year period what to do about smaller sources. The Tailoring Rule is available at http://www.epa.gov/nsr/
actions.html#may10. A separate guidance document, “Reconsideration of Interpretation of Regulations that Determine
Pollutants Covered by Clean Air Act Permitting Programs,” at 75 Federal Register 17004, April 2, 2010, delays the
effective date of the permit requirements to January 2, 2011.
17
In general, for example, the act defines major emission sources as those that emit more than 100 or 250 tons per year
of a pollutant: as noted above, this would include as many as 6 million sources in the case of CO2, potentially
overburdening EPA and state environmental agencies. Thus, the Clean Air Act’s existing authority may be useful as a
starting point, but most observers conclude that a new control program designed specifically to address GHGs would
make more sense.
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retaining the authorities questioned the necessity of their removal. (For a further discussion of
these authorities, see CRS Report R40585, Climate Change: Potential Regulation of Stationary
Greenhouse Gas Sources Under the Clean Air Act, and CRS Report R41212, EPA Regulation of
Greenhouse Gases: Congressional Responses and Options.)
Agricultural Sources of Emissions
Another major controversy concerned the treatment of agricultural sources of emissions in the
Waxman-Markey bill. The bill would have excluded the “agricultural and forestry sectors”
(undefined in the bill) from its emissions cap. It would also have excluded sources of methane
from enteric fermentation (livestock) from the standards that EPA must promulgate for uncapped
emission sources. Instead, it would have treated agriculture and forestry activities as a source of
offsets (reductions from sources outside the cap-and-trade system) that could be purchased by
capped sources and used in place of allowances. The bill would have allowed the use of up to 1
billion offset credits from domestic sources annually.
Industrial and electric utility emitters subject to the GHG cap would presumably have purchased
offsets if the cost of doing so were less than the cost of controlling their own emissions or of
purchasing allowances. As a result, agriculture and forestry could have earned substantial sums
for activities undertaken to reduce their GHG emissions—from $3.7 billion to $7.8 billion
annually in gross revenues using an initial set of CBO assumptions. 18 USDA’s Economic
Research Service was less sanguine about the near-term revenues; nevertheless, its analysis
“strongly suggests that revenue from agricultural offsets ... rise faster than costs to agriculture
from cap and trade legislation.”19
The agriculture provisions helped insure some support for the bill from the agricultural
community, but raised concerns among those who favored a more stringent bill. Of particular
concern to the latter group was the bill’s delegation of authority over the offset program to the
Department of Agriculture rather than to EPA.
International Offsets
The bill would also have allowed up to 1 billion offset credits to be generated annually by
international sequestration or emission reduction activities. If fewer than 1 billion domestic
offsets were used, up to 500 million additional international offsets could have been substituted,
raising the total permissible international offsets to as many as 1.5 billion in any given year. The
18
In its June 5 cost estimate for H.R. 2454 as ordered reported, the Congressional Budget Office estimated that
allowance prices would range from $16 per ton in 2012 to $26 per ton in 2019. Based on EPA data on the available
supply of domestic offsets at different prices, CBO estimated that covered entities would use domestic offsets to
substitute for about 230 million allowances in 2012 and about 300 million allowances in 2020. Under these
assumptions, the value of offset credits to the agricultural and forestry sectors would range from $3.68 billion in 2012
to as much as $7.8 billion in 2020. See Congressional Budget Office Cost Estimate, “H.R. 2454, American Clean
Energy and Security Act of 2009, as ordered reported by the House Committee on Energy and Commerce on May 21,
2009,” June 5, 2009, at http://www.cbo.gov/ftpdocs/102xx/doc10262/hr2454.pdf. EPA estimates were lower: the
agency’s modeling projected domestic offset revenues at $2.3 billion in 2015 and $3.0 billion in 2020. Offset providers
would, of course, incur costs to undertake the activities that generate the offsets, so net revenues would be lower than
these estimates in each case.
19
Office of the Chief Economist, Economic Research Service, U.S. Department of Agriculture, “A Preliminary
Analysis of the Effects of H.R. 2454 on U.S. Agriculture,” July 22, 2009, p. 11.
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objective of this provision was to provide emission reductions at a lower cost than domestic GHG
controls and reduce emissions from developing countries. 20 Opponents of the provision, however,
viewed it as a give-away to countries that choose not to participate in internationally agreed
reduction requirements.
Tariff Provisions
For more than a decade, a primary concern in the climate debate has been how a GHG emissions
cap or other GHG controls would affect the competitiveness of U.S. industry: whether, for
example, it might lead manufacturers of carbon-intensive goods to relocate production to
countries with weaker GHG regulations or no cap at all. A number of options have been proposed
to address this “carbon leakage” concern, including directly supporting domestic carbon-intensive
industries, imposing countervailing duties or allowance requirements on imports from countries
with weaker GHG requirements, and/or developing sectoral approaches that address the
emissions of specific industries worldwide. 21
H.R. 2454 would have established an allowance rebate program for energy-intensive, tradeexposed industries. The net effect of the program would have been that these industries (likely to
include iron and steel, aluminum, and other energy-intensive heavy industry) would have been
given free allowances until 2025. Starting then, the rebates would have been phased out over a
10-year period.
EPA, with the concurrence of U.S. Customs, would also have been required to establish
international reserve allowance requirements (tariff provisions) for imports of energy-intensive
trade-exposed goods from countries that have not entered into international agreements for GHG
emission reductions at least as stringent as those of the United States. This provision, which
would have begun in 2020, was singled out by the President after the bill’s passage as an area of
concern. Earlier versions of the bill would have given the President tariff authority, but would
have allowed him greater discretion not to impose the tariffs.
State Preemption
A number of states, notably California and the Northeastern states, have already begun programs
to reduce GHG emissions. (For a discussion, see CRS Report RL33812, Climate Change: Action
by States to Address Greenhouse Gas Emissions.) Although the federal government under the
Bush Administration challenged some of these programs, particularly those affecting mobile
sources, states do have clear authority to regulate emissions from power plants, landfills,
residential and commercial buildings, and other stationary sources of GHGs. The extent to which
such state programs might serve as national models (or that a patchwork of state programs might
serve as a catalyst to a stronger federal regime) has been one set of issues; another is the degree to
which a federal program might preempt state measures affecting similar sources.
20
Many of the least cost GHG reduction options may be in developing countries, but verification of the baseline
emissions and of the continued application of emission controls could pose challenges to the regulatory authority in
such cases. For a discussion of offsets, see CRS Report RL34436, The Role of Offsets in a Greenhouse Gas Emissions
Cap-and-Trade Program: Potential Benefits and Concerns, by (name redacted).
21
For a discussion, see CRS Report R40100, “Carbon Leakage” and Trade: Issues and Approaches, by (name redacted)
and (name redacted).
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The Waxman-Markey bill would generally have left the states’ authority to set standards for
stationary sources of GHGs intact. One exception would have been that state and regional capand-trade programs for GHGs would have been preempted from 2012 through 2017. The bill also
would have preserved EPA’s authority to grant waivers to California for mobile source GHG
standards.
Cost of the Bill
Among the most important issues in the House debate was the prospective cost of the bill. In an
earlier CRS report, CRS noted that long-term cost projections, particularly for a bill that would
reduce GHG emissions over the course of four decades, are at best speculative.22 Over such a
long period of time, uncertainty about the future direction of the basic drivers of greenhouse gas
emissions and the economy’s responsiveness (economically, technologically, and behaviorally)
make economic models unable to predict the ultimate macroeconomic costs of a GHG reduction
program.
Despite this and similar caveats offered by other analysts, estimates of the bill’s impact were
widely cited both by opponents and proponents in the House debate. Opponents of the bill
claimed that it would impose costs of as much as $3,100 annually per family, one source of which
was a 2007 assessment of U.S. cap-and-trade proposals prepared by MIT’s Joint Program on the
Science and Policy of Global Change. The author of that study, in letters to the House minority
leader and the Select Committee on Energy Independence and Global Warming, stated that the
study’s conclusions had been misstated.23
At the other end of the spectrum, EPA estimated that the costs of the reported bill (prior to some
of the final changes) would be $80 to $111 per family, annually,24 or as proponents have
sometimes expressed it, less than the cost of a postage stamp a day. EPA’s lower cost was, in part,
the result of assuming cost-saving energy technologies and including the availability of low-cost
emission offsets from both domestic and international sources. As noted above, the House bill
would have allowed the use of as many as 2 billion offsets annually (out of a total allowance pool
of 5-6 billion in the initial years). Questions have been raised whether so many offsets would
actually be available, especially in the short term.25
22
CRS Report RL34489, Climate Change: Costs and Benefits of S. 2191/S. 3036, by (name redacted) and (name red
acted). A report addressing the costs of H.R. 2454 (CRS Report R40809,
Climate Change: Costs and Benefits of
the Cap-and-Trade Provisions of H.R. 2454, by (name redacted) and (name redacted)) reaches similar conclusions,
while analyzing the results of seven studies that have modeled the costs of H.R. 2454.
23
In an April 1, 2009 letter, John Reilly, Associate Director of the MIT program, stated that the $3,100 estimate “... is
nearly 10 times the correct estimate which is approximately $340.” The $3,100 figure was widely quoted, including
during House debate on H.R. 2454, June 26. The letters stating that the cost data were being misrepresented appeared at
http://www.talkingpointsmemo.com/documents/2009/04/mit-scientist-republicans-confused-about-my-climate-changestudy.php?page=1.
24
U.S. EPA, Office of Atmospheric Programs, EPA Analysis of the American Clean Energy and Security Act of 2009,
H.R. 2454, in the 111th Congress, June 23, 2009, at http://energycommerce.house.gov/Press_111/20090623/
hr2454_epaanalysis2.pdf.
25
For example, see “How Realistic Are Expectations for the Role of Greenhouse Gas Offsets in U.S. Climate Policy?”
World Resources Institute Working Paper, March 2009, at http://pdf.wri.org/working_papers/
greenhouse_gas_offsets_in_us_climate_policy_phase1.pdf.
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A related issue was the impact of the bill on the federal deficit. In a letter dated June 26, 2009, the
Congressional Budget Office and the Joint Committee on Taxation (JCT) estimated that
enacting the legislation would increase revenues by $873 billion over the 2010-2019 period
and would increase direct spending by $864 billion over that 10-year period. In total, CBO
and JCT estimate that enacting the legislation would reduce future budget deficits by about
$4 billion over the 2010-2014 period and by about $9 billion over the 2010-2019 period.26
Whatever the true cost, a bill of this size, affecting numerous sectors of the economy, would be
bound to create winners and losers, even if its net impact on the economy or on federal revenues
were small. The result was intense lobbying, as affected industries/states/regions/labor unions/etc.
attempted to shape the bill to their advantage.
Experience with Other Cap-and-Trade Systems
Although now disparaged by opponents of climate legislation, cap-and-trade programs have had
an enviable reputation over most of the last two decades, largely based on the success of the
Clean Air Act’s acid rain program. That program imposed a cap on sulfur dioxide emissions for a
limited number of electric power plants in 1995, and in 2000 lowered the cap and expanded
coverage to more plants. It met its emission reduction goals at low cost, with virtually 100%
compliance, and with minimal administrative oversight.
The success of the program was at least partly the result of the favorable circumstances in which
it was implemented: the reduction targets were easily met because of an abundant supply of cheap
low-sulfur coal; there were only about 1,000 entities (power plants) covered by the trading
program, making it simple and inexpensive to monitor and administer; and most of the regulated
entities were allowed 10 years to achieve compliance, by which time early reductions had
generated an enormous number of extra allowances that helped lubricate the trading system.
Some other trading programs have not been as successful. Southern California’s Regional Clean
Air Incentives Market (RECLAIM), for example, which was implemented in 1994 to reduce
emissions of NOx and SO2 in the Los Angeles area, saw a 50-fold increase in NOx allowance
prices during the 2000-2001 California energy crisis. To permit its continued functioning and
allow utilities to use backup power generators, electric utilities were removed from the
RECLAIM system, charged a flat fee of $15,000 per ton for excess emissions, and subjected to
new command and control requirements (i.e., the type of regulation the trading system was
designed to avoid). The European GHG trading system (EU-ETS), established to help European
Union countries meet their Kyoto Protocol targets, saw wild swings in short-term allowance
prices during its start-up years, making planning and decision-making difficult for participating
entities. 27
Both supporters and opponents have cited previous experience with cap-and-trade systems to
buttress their arguments, and the House bill’s GHG cap-and-trade system was designed to deal
with several of the problems experienced by previous systems. Among the most notable of the
26
Letter of Douglas W. Elmendorf, Director, CBO, to Hon. Henry A. Waxman, Chairman, Committee on Energy and
Commerce, June 26, 2009, p. 1.
27
For additional information on the EU trading system, see CRS Report RL34150, Climate Change and the EU
Emissions Trading Scheme (ETS): Kyoto and Beyond, by (name redacted).
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design features were mechanisms to address potential volatility of allowance prices. The bill
addressed cost control through five main mechanisms: (1) unlimited banking and limited
borrowing of allowances, (2) a two-year compliance period, (3) a strategic auction with a reserve
price to increase the availability of allowances in the early years of the program, (4) periodic
auctions with a reserve price, and (5) generous limits on the use of offsets.28
Emissions from Power Plants
In addition to climate change, other clean air issues with a shorter time horizon are being
addressed by EPA. Many of these have to do with emissions from electric power plants.
Coal-fired power plants are among the largest sources of air pollution in the United States. Under
the Clean Air Act, however, they are not necessarily subject to stringent requirements: emissions
and the required control equipment can vary depending on the location of the plant, when it was
constructed, whether it has undergone major modifications, the specific type of fuel it burns, and,
to some extent, the vagaries of EPA enforcement policies. More than half a dozen separate Clean
Air Act programs could potentially be used to control emissions, which makes compliance
strategy complicated for utilities and difficult for regulators. Because the cost of the most
stringent available controls, for the entire industry, could range into the tens of billions of dollars,
utilities have fought hard and rather successfully to limit or delay regulations affecting them,
particularly with respect to plants constructed before the Clean Air Act of 1970 was passed.
As a result, emissions from power plants have not been reduced as much as those from some
other sources. Many plants built in the 1950s and 1960s (generally referred to as “grandfathered”
plants) have little emission control equipment.
Collectively, power plants are large sources of pollution. In 2005, they accounted for 10.2 million
tons of sulfur dioxide (SO2) emissions (70% of the U.S. total), 52 tons of mercury emissions
(46% of the U.S. total), and 3.6 million tons of nitrogen oxides (19% of the U.S. total). Power
plants are also considered major sources of fine particles (PM2.5), many of which form in the
atmosphere from emissions from a wide range of stationary and mobile sources. In addition,
power plants account for about 40% of U.S. anthropogenic emissions of the greenhouse gas
carbon dioxide.
With new ambient air quality standards for ozone, fine particles, and SO2 taking effect, emissions
of NOx and SO2 will necessarily have to be reduced to meet standards.29 (These standards are
discussed below under “Air Quality Standards.”) For more than a decade, mercury emissions
have also been a focus of concern: 48 states have issued fish consumption advisories due to
mercury pollution, covering 14 million acres of lakes, 882,000 river miles, and the coastal waters
of 13 entire states. The continuing controversy over the interpretation of New Source Review
requirements for existing power plants (also discussed below) has exerted pressure for a more
predictable regulatory structure, as well.
28
For more information, see CRS Report R40643, Greenhouse Gas Legislation: Summary and Analysis of H.R. 2454
as Passed by the House of Representatives, coordinated by (name redacted) and (name redacted).
29
NOx contributes to the formation of ozone and fine particles; SO2, besides being a regulated pollutant in its own
right, is also among the sources of fine particles.
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Thus, some in industry, environmental groups, Congress, and the last two Administrations have
said that legislation addressing power plant pollution in a comprehensive (multi-pollutant)
fashion would be desirable. Such legislation would address the major pollutants on a coordinated
schedule and would rely, to a large extent, on a system such as the one used in the acid rain
program, where national or regional caps on emissions are implemented through a system of
tradable allowances. The key questions have been how stringent the caps should be and whether
carbon dioxide (CO2), the major gas of concern with regard to climate change, would be among
the emissions subject to a cap.
Clean Air Interstate Rule (CAIR)
The Senate Environment and Public Works Committee has voted twice on a multi-pollutant bill
(in 2002 and 2005), but neither of the bills progressed to the Senate floor. In the House, similar
bills have been introduced, but none has progressed to markup. On March 10, 2005, therefore,
EPA announced that it would use existing Clean Air Act authority to promulgate final regulations
similar to the Bush Administration’s multi-pollutant bill (the “Clear Skies” bill30) for utility
emissions of SO2 and NOx in 28 eastern states and the District of Columbia.31
The Clean Air Interstate Rule (CAIR) established cap-and-trade provisions for SO2 and NOx.32
CAIR covered only the eastern half of the country, but since most of the grandfathered generation
capacity is located in the East and South, EPA projected that nationwide emissions of SO2 would
decline 53% by 2015 and NOx emissions 56%.33 The agency also projected that the rule would
result in $85-$100 billion in health benefits annually by 2015, including the annual prevention of
17,000 premature deaths. CAIR’s health and environmental benefits would be more than 25 times
greater than its costs, according to EPA.
North Carolina v. EPA
CAIR was one of the few Bush Administration environmental initiatives that was generally
supported by environmentalists. It also had broad support among the regulated community. But a
variety of petitioners, including the state of North Carolina, which argued that the rule was not
strong enough to address pollution from upwind sources, and some individual utilities that felt
they were unfairly treated by the rule’s emission budgets, challenged the rule in the D.C. Circuit,
and the court vacated it July 11, 2008. A unanimous court found that EPA had established a
significant contribution made by power plants to nonattainment of standards and failure to
maintain standards in downwind states, as required by Section 110 of the Clean Air Act, but the
30
President Bush first proposed the Clear Skies Act on February 14, 2002, and the bill was introduced by request in the
107th Congress as H.R. 5266/S. 2815. In the 109th Congress, a somewhat modified Clear Skies bill, introduced as S.
131, was considered by the Environment and Public Works Committee, but failed to advance, on a 9-9 vote. Clear
Skies was not introduced in the 110th Congress.
31
The rule appeared in the Federal Register two months later. See U.S. EPA, “Ambient air quality standards,
national—Fine particulate matter and ozone; interstate transport control measures,” 70 Federal Register 25162, May
12, 2005.
32
A separate regulation, the Clean Air Mercury Rule (CAMR), promulgated at the same time, established a ClearSkies-like cap-and-trade system for mercury emissions. It is described in a separate section below.
33
As compared to nationwide emissions from electric generating units in 2001. Some of the projected reduction would
be due to pre-existing regulations. See U.S. EPA, Office of Air and Radiation, Regulatory Impact Analysis for the Final
Clean Air Interstate Rule, March 2005, pp. 3-3 and 3-4, at http://www.epa.gov/cair/pdfs/finaltech08.pdf.
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court concluded that the agency’s methodology for establishing emission budgets for each state
was unrelated to that link. 34 The court also found that the choice of 2015 for a second phase
compliance deadline, based on technological and economic feasibility, ignored EPA’s statutory
mandate. It found the fuel adjustment factors in the rule (which set more stringent requirements
for natural gas- and oil-fired plants than for coal-fired ones) to be arbitrary and capricious. It
concluded: “CAIR’s flaws are deep. No amount of tinkering ... will transform CAIR, as written,
into an acceptable rule.”35
Despite the seemingly high hurdle set by the language the court used, EPA, environmental
groups, and the utility and mining industries asked the court to review its decision. On December
23, 2008, the court modified its decision, allowing CAIR to remain in effect until a new rule is
promulgated by EPA. 36 The court was not specific about how long this process would be allowed
to take, but stated:
Though we do not impose a particular schedule by which EPA must alter CAIR, we remind
EPA that we do not intend to grant an indefinite stay of the effectiveness of this court’s
decision. Our opinion revealed CAIR’s fundamental flaws, which EPA must still remedy.37
Effects of the Decision
From a policy standpoint, the court’s vacatur of CAIR would remove the lynchpin of the Bush
Administration’s approach to clean air. CAIR was a principal means by which EPA projected that
nonattainment areas in the eastern half of the country would attain the ozone and fine particulate
National Ambient Air Quality Standards (NAAQS); in the agency’s analysis, it would also have
been responsible for achieving the lion’s share of reductions in mercury emissions from coal-fired
power plants (as discussed further below); it would have addressed regional haze impacts from
power plants; and it would have addressed state petitions to control upwind sources of ozone and
fine particulate pollution, making controls on individual power plants under Section 126 of the
Clean Air Act unnecessary, according to EPA. Thus, EPA asked the court to reconsider its
decision, which led the court to announce that it would delay issuing its mandate.
There is general agreement among the states, electric utilities, and environmental groups that
something like CAIR should be salvaged.
•
Without CAIR, most eastern states would have huge gaps in their emission
control programs, which would have to be filled by other regulatory measures if
the states are to attain the NAAQS by the statutory deadlines. The states could be
subject to sanctions, including a suspension of federal highway funding for new
projects, if they fail to adopt such measures.
•
For the utilities, CAIR was designed to build on the existing regulatory
framework of cap-and-trade programs under the acid rain program and the “NOx
SIP Call.”38 Anticipating the ability to bank and trade emission allowances under
34
North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008).
Id. at 930.
36
North Carolina v. EPA, 2008 Westlaw 5335481 (D.C. Cir. Dec. 23, 2008).
37
Id. at *1.
35
38
The acid rain program is described above on p. 11. The NOx SIP Call, implemented in 2004, is a cap-and-trade
program for control of nitrogen oxide emissions in the eastern half of the country.
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CAIR, numerous utilities have already invested in equipment to meet or exceed
CAIR’s requirements, the first phase of which are now being implemented.
•
For environmental groups, which found little to their liking in the Bush
Administration, CAIR was the major exception. They argued for a stronger
version of CAIR—particularly its second phase, to be implemented in 2015—but
they generally supported the basic approach.
EPA’s CAIR Replacement: The Clean Air Transport Rule
On July 6, 2010, EPA proposed a replacement for CAIR, the Clean Air Transport Rule.39 The
transport rule would leave the CAIR Phase 1 limits in place and would set new limits replacing
CAIR’s second phase in 2012 and 2014, up to three years earlier than CAIR would have.
The CAIR Phase 1 rules already appear to be having substantial effects. On August 11, 2010, EPA
reported that emissions of SO2 had declined sharply in both 2008 and 2009: in the latter year,
emissions from fossil-fueled power plants in the lower 48 states (at 5.7 million tons) were 44%
below 2005 levels. NOx emissions from the same sources declined to 1.8 million tons in 2009, a
decline of 45% compared to 2005.40 Further reductions of both SO2 and NOx can be expected as
Phase 1 takes effect.
The proposed transport rule would build on these reductions. It would establish a second and third
phase of reductions in 2012 and 2014, with particular emphasis on SO2—emissions of which
would decline to 3.8 million tons (62% below 2005 levels) in 2014. The proposed rule would
cover 31 Eastern, Midwestern, and Southern states and the District of Columbia, adding three
new states (Oklahoma, Kansas, and Nebraska) to the 28 covered by CAIR. The rule would allow
unlimited trading of allowances within individual states, but it would limit interstate trading in
order to comply with the D.C. Circuit’s ruling. In order to insure that the rule is implemented
quickly, EPA proposed a Federal Implementation Plan (FIP) for each of the states: the FIP
specifies budgets for each state based on controlling emissions from electric power plants. States
may develop their own State Implementation Plans and choose to control other types of sources if
they wish, but the federal plan will take effect unless the state acts.
EPA estimates that the rule will cost the power sector $2.8 billion annually in 2014, but it expects
the benefits to be 40 to 100 times as great—an estimated $120 billion to $290 billion annually.
The most important benefit would be 14,000 to 36,000 fewer premature deaths annually. Avoided
deaths and other benefits occur throughout the East, Midwest, and South, according to EPA, with
Ohio, Pennsylvania, and New York benefitting the most.41
Because the agency is near finalizing more stringent ambient air quality standards for ozone, it
stated its intention to propose another transport rule in 2011 to address any additional emission
reductions needed to meet those new standards. It also stated an “ongoing commitment” to
consider upwind contributions of pollution to nonattainment when implementing any future
39
The proposal appeared in the Federal Register August 2, 2010. The rule, a Fact Sheet, a Regulatory Impact Analysis,
and an overview presentation can be found on EPA’s website at http://www.epa.gov/airtransport/actions.html#jul10.
40
Data are from EPA’s “2009 Acid Rain Program Emission and Compliance Data Report,” August 11, 2010, at
http://www.epa.gov/airmarkets/progress/ARP09.html.
41
U.S. EPA, Office of Air and Radiation, “Proposed Air Pollution Transport Rule,” Overview Presentation, July 26,
2010, pp. 13-15, at http://www.epa.gov/airtransport/pdfs/TRPresentationfinal_7-26_webversion.pdf.
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NAAQS revisions. With revisions of the fine particulate (PM2.5) standard expected in 2011,
additional transport rules might be expected.
State air pollution control agencies, through the National Association of Clean Air Agencies
(NACAA), have argued that substantial further reductions will be necessary if the states are to
attain the new ozone standards. Ozone forms through chemical reactions in the atmosphere
between volatile organic compounds and NOx; thus, NOx reductions are key to attaining a more
stringent ozone standard. For NOx, the Phase 1 cap is 45% below baseline, with Phase 2
providing an additional 7%. The technology is clearly available to do more: EPA modeling
projects 34% of coal-fired electric generating units in the transport region to be without the best
available NOx control in 2014.42 Assuming that modeling shows that more reductions are needed
for the states to attain the new ozone NAAQS, the pressure will be on EPA to strengthen the
regulations further.
Judicial and Legislative Options
The courts might be the venue for further consideration of the issues if any of the parties find
themselves unhappy with the pace or substance of EPA’s regulatory decisions.
Congress might also act: in order to shorten the regulatory process and avoid further litigation,
some have argued that Congress needs to resolve the issues posed by the D.C. Circuit’s 2008
CAIR decision. Over the past decade, several dozen multi-pollutant bills would have addressed
SO2 and NOx emissions from power plants through a cap-and-trade system, most of them in
conjunction with controls on mercury and CO2. If legislation is to be considered now, the issues
might, therefore, include not only the stringency and timing of SO2 and NOx controls, but also
whether to include mercury and CO2 controls in the bill.
On February 4, 2010, Senators Carper and Alexander, with a bipartisan group of cosponsors,
introduced S. 2995 to address the issues posed by the CAIR decision and to set standards for
power plant mercury emissions. The bill would establish cap-and-trade systems for SO2 and NOx
with more stringent caps than those of the CAIR rule or EPA’s proposed replacement. The SO2
cap would be 78% below the 2001 baseline in 2015, and 83% below in 2018. The EPA
Administrator would be authorized to reduce the cap further for 2021 and later years. The NOx
cap would also be more stringent than provided by CAIR or the proposed transport rule and it
would cover 32 states (seven more than CAIR, four more than the proposed EPA rule). In 2012,
its cap would be 24% below CAIR’s emissions level (in addition to covering more states within
that cap). In 2015, its cap would be identical to CAIR’s, but because it would cover seven more
states, would still be substantially more stringent. The bill would also establish a NOx cap in the
rest of the lower 48 states for the first time, which would decline 37% by 2020.
At a Senate hearing, March 4, 2010, there was general support for S. 2995, although some
concern was expressed that the reductions would still not be sufficient to bring Eastern states into
attainment of the ozone NAAQS.43
42
U.S. EPA, Office of Air and Radiation, Regulatory Impact Analysis for the Proposed Federal Transport Rule, June
2010, Table 7-11, p. 259, http://www.epa.gov/ttn/ecas/regdata/RIAs/proposaltrria_final.pdf. The technology referred to
is selective catalytic reduction (SCR).
43
“Legislative Hearing: S. 2995, The Clean Air Act Amendments of 2010,” U.S. Senate Committee on Environment
and Public Works, March 4, 2010. See especially the testimony of Colin P. O’Mara, Secretary, Delaware Department
(continued...)
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Clean Air Issues in the 111th Congress
Clean Air Mercury Rule (CAMR)
Background
Regulation of mercury emissions from coal-fired power plants has a complicated legislative and
regulatory history, dating back to the 1990 Clean Air Act Amendments. EPA was required by that
legislation and a 1998 consent agreement to determine whether regulation of mercury from power
plants under Section 112 of the Clean Air Act was appropriate and necessary. Section 112 is the
section that regulates emissions of hazardous air pollutants. In general, it requires EPA to set
standards based on the Maximum Achievable Control Technology (a term defined with great
precision in the act), and to impose the MACT standards at each individual emissions source. In a
December 2000 regulatory finding, EPA concluded that regulation of mercury from power plants
under Section 112 was appropriate and necessary. The finding added coal- and oil-fired electric
generating units to the list of sources of hazardous air pollutants, and triggered other provisions of
the 1998 consent agreement: that the agency propose MACT standards for them by December 15,
2003, and finalize the standards by March 15, 2005.
Rather than promulgate MACT standards, however, EPA reversed its December 2000 finding in
March 2005, and established through regulations a national cap-and-trade system for power plant
emissions of mercury, the Clean Air Mercury Rule (CAMR). Under CAMR, the final cap would
have been 15 tons of emissions nationwide in 2018 (about a 70% reduction from 1999 levels,
when achieved). There would also have been an intermediate cap of 38 tons in 2010, well above
EPA’s projection of emissions in that year.44
Under the cap-and-trade system, utilities could either control the pollutant directly or purchase
excess allowances from other plants that instituted controls more stringently or sooner than
required. As with the acid rain and CAIR cap-and-trade programs, early reductions under CAMR
could have been banked for later use, which the agency itself said would result in utilities
delaying compliance with the full 70% reduction until well beyond 2018, as they used up banked
allowances rather than installing further controls. The agency’s analysis projected actual
emissions to be 24.3 tons (less than a 50% reduction) as late as 2020. Full compliance with the
70% reduction would have been delayed until after 2025.45 (For additional information on the
mercury rule, see CRS Report RL32868, Mercury Emissions from Electric Power Plants: An
Analysis of EPA’s Cap-and-Trade Regulations, by (name redacted).)
New Jersey v. EPA
The CAMR rule was immediately challenged in petitions for review filed by New Jersey and 16
other states as well as other petitioners.46 The D.C. Circuit, in a 3-0 decision handed down
February 8, 2008,47 vacated the rule. The court found that once the agency had listed electric
(...continued)
of Natural Resources and Environmental Control.
44
The agency projected emissions at 31 tons in 2010 even if 99% of the generating units installed no mercury control
equipment.
45
U.S. EPA, Mercury RIA, previously cited, Table 7-3, p. 7-5.
46
Seven other states joined EPA in defending the rule.
47
New Jersey v. EPA, 517 F.3d 574 (D.C. Cir. 2008).
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Clean Air Issues in the 111th Congress
generating units (EGUs) as a source of hazardous air pollutants, it had to proceed with MACT
regulations under Section 112 of the act unless it “delisted” the source category, under procedures
the act sets forth in Section 112(c)(9). Delisting would have required the agency to find that no
EGU’s emissions exceeded a level adequate to protect public health with an ample margin of
safety, and that no adverse environmental effect would result from any source—a difficult test to
meet, given the agency’s estimate that EGUs are responsible for 46% of mercury emissions from
all U.S. sources. Rather than delist the EGU source category, the agency had maintained that it
could simply reverse its December 2000 “appropriate and necessary” finding, a decision that was
much simpler because there were no statutory criteria to meet. The court found this approach
unlawful. “This explanation deploys the logic of the Queen of Hearts, substituting EPA’s desires
for the plain text of Section 112(c)(9),” the court said in its opinion.48
Other Mercury Issues
Besides the question of whether EPA complied with the law’s requirements, critics found other
reasons to oppose EPA’s cap-and-trade approach to controlling mercury. One of the main
criticisms has been that it would not address “hot spots,” areas where mercury emissions and/or
concentrations in water bodies are greater than elsewhere. In fact, under a cap-and-trade system,
nothing would prevent emissions from increasing at hot spots. Many also argued that the mercury
regulations should have been more stringent or implemented more quickly than the cap-and-trade
regulations would have required. These arguments found a receptive audience in the states: about
20 states have promulgated requirements stricter than the federal program, with several requiring
80% to 90% mercury reductions before 2010. (For additional information, see archived CRS
Report RL33535, Mercury Emissions from Electric Power Plants: States Are Setting Stricter
Limits, by (name redacted).)
Next Steps
Under the D.C. Circuit’s ruling, unless EPA delists the power plant category, it does not have the
legislative authority to establish a cap-and-trade program for their mercury emissions: it must
impose MACT standards on each individual plant once it has listed the category. The agency
could have appealed the court’s ruling: under the Bush Administration, on October 17, 2008, it
petitioned for certiorari to the Supreme Court.49 But the Obama Administration withdrew the
petition in early February 2009 and announced that it will proceed with the development of
MACT standards.50 Proposed standards are expected, under a consent agreement, by March 2011,
with final standards to be promulgated in November of that year.
While the agency develops new regulations in response to the court’s remand, new coal-fired
electric generating units and modifications of existing units will be required to obtain permits
under a provision of the law known as the “MACT hammer” (Section 112(g)(2)). Under this
provision, if no applicable emission limits have been established, no person may construct a new
major source or modify an existing major source in the category unless the Administrator or the
state determine on a case-by-case basis that they meet MACT emission limits. On February 28,
48
Id. at 582.
77 U.S.LW 3253 (No. 08-512).
50
Withdrawal of EPA’s petition for certiorari left a separate petition filed by the Utility Air Regulatory Group before
the Court. The Court denied that petition, February 23, 2009.
49
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2008, the Natural Resources Defense Council (NRDC) released a list of 32 new coal-fired power
plants in 13 states that it believed must adopt MACT mercury controls under this provision. 51
New Source Review
A related issue that has driven some of the debate over the regulation of power plant emissions is
whether EPA has adequately enforced existing regulations, using a process called New Source
Review (NSR). The New Source Review debate has occurred largely in the courts. EPA took a
more aggressive stance on NSR late in the Clinton Administration, filing lawsuits against 13
utilities for violations at 51 plants in 13 states. The Bush and Obama Administrations have taken
action against an additional dozen or so utilities and, after years of negotiation, settled many of
the original suits.52 In the interim, however, the Bush Administration proposed major changes in
the NSR regulations that critics argued would have weakened or eliminated New Source Review
as it pertained to modifications of existing plants. Under the Obama Administration, some
additional NSR cases have been filed against electric utilities, and six cases have been settled.
The controversy over the NSR process stems from EPA’s use of it to require the installation of
best available pollution controls on existing stationary sources of air pollution that have been
modified. The Clean Air Act requires that plants undergoing modifications meet these NSR
requirements, but industry has often avoided the NSR process by claiming that changes to
existing sources were “routine maintenance” rather than modifications. In the 1990s, EPA began
reviewing records of electric utilities, petroleum refineries, and other industries to determine
whether the changes were, in fact, routine. As a result of these reviews, since late 1999, EPA and
the Department of Justice have filed suit or administrative actions against numerous large sources
of pollution, alleging that they made major modifications to their plants, extending plant life and
increasing output, without undergoing required New Source Reviews and without installing best
available pollution controls.
Of the utilities charged with NSR violations, 21 have settled with the EPA, generally without
going to trial. Under the settlements, they have agreed to spend about $10 billion on pollution
controls or fuel switching to reduce emissions at their affected units. Combined, these companies
will reduce pollution by at least 1.65 million tons annually. 53 Since March 2000, the agency has
also reached 24 agreements with petroleum refiners representing 88% of industry capacity. The
refiners agreed to settle potential charges of NSR violations by paying fines and installing
equipment to eliminate 337,000 tons of pollution.
The courts have generally sided with the Clinton Administration’s interpretation of NSR. In the
first case to go to trial, the U.S. District Court for the Southern District of Ohio found that Ohio
Edison had violated the Clean Air Act 11 times in modifying its W. H. Sammis power plant.54 The
company subsequently settled the case, agreeing to spend $1.1 billion to install controls that are
expected to reduce pollution by 212,000 tons annually. A second case, involving Duke Energy,
51
NRDC, “32 Coal-Fired Power Plants in 13 States Now Up in the Air After Major Court Ruling on Mercury,” Press
Release, February 28, 2008, at http://www.nrdc.org/media/2008/080228.asp.
52
For the current status of the NSR lawsuits under EPA’s Coal-Fired Power Plant Enforcement Initiative, see
http://www.epa.gov/compliance/resources/cases/civil/caa/coal/index.html.
53
Total emissions of SO2 and NOx from all sources nationwide were 37 million tons in 2003. Thus, settlements with
the 21 utilities will eliminate about 5% of total emissions of the two pollutants.
54
United States v. Ohio Edison Co., 276 F. Supp. 2d 829 (S.D. Ohio 2003).
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Clean Air Issues in the 111th Congress
was initially decided in the utility’s favor, but on appeal to the Supreme Court, the utility lost. The
issue in that case involved whether EPA should consider the hourly emissions rate or the annual
total of emissions in deciding whether to apply NSR. The U.S. District Court for the Middle
District of North Carolina, in a decision upheld by the Fourth Circuit Court of Appeals, held that
the company was not required to undergo NSR and install more stringent pollution controls since
the maximum hourly emissions rate did not increase as a result of the modifications, even if
annual emissions did increase.55 On April 2, 2007, the Supreme Court overturned the lower court
rulings in a unanimous decision, finding that EPA’s regulations, promulgated in 1980, clearly
specified an increase in actual annual emissions as the measure of whether a permit for a
modification was required.56
The Bush Administration promulgated a number of changes to the NSR regulations that would
have made future enforcement of NSR less likely. In December 2002 and October 2003, the
agency promulgated five sets of changes to the NSR rules. The most controversial were new
regulations defining what constitutes routine maintenance.57 The new regulations would have
exempted industrial facilities from undergoing NSR (and thus from installing new emission
controls) if the cost of the replacement components was less than 20% of the replacement value
of the process unit. Using this benchmark, few, if any, plant modifications would trigger new
pollution controls. Fifteen states, three municipalities, and several environmental groups filed suit
to block this “equipment replacement / routine maintenance” rule. The rule was stayed by the
U.S. Court of Appeals for the D.C. Circuit on December 24, 2003, and on March 17, 2006, a
three-judge panel of the court unanimously struck the rule down.58 In its decision, the court held
that EPA’s attempt to change the NSR regulations was “contrary to the plain language” of the
Clean Air Act.59
EPA proposed further changes to the NSR regulations on October 20, 2005, and September 14,
2006.60 For the most part, these regulations have not been promulgated. Under the October 2005
proposal, power plants could have modified existing facilities without triggering NSR, provided
that the facility’s “maximum hourly emissions achievable” after the changes were no greater than
the same measure at any point during the past five years. The new rule would have effectively
allowed increases in annual emissions without an NSR permit, if a modification led to an increase
in the hours of operation of a facility. The agency’s proposal stated that this change would
establish a uniform national emissions test, in conformance with the Fourth Circuit’s decision in
the Duke Energy case, and it downplayed the significance of the change in light of “substantial
55
United States v. Duke Energy Corp., 278 F.Supp. 2d 619 (M.D.N.C. 2003), affirmed, 411 F. 3d 539 (4th Cir., 2005).
Environmental Defense v. Duke Energy Corp., 549 U.S. 561 (2007).
57
U.S. EPA, “Prevention of significant deterioration and nonattainment new source review; routine maintenance,
repair and replacement,” 68 Federal Register 61247, October 7, 2003.
58
New York v. EPA, 443 F.3d 880 (D.C. Cir. 2006) cert. denied, 127 S.Ct. 2127 (2007).
59
Id. at 883.
60
U.S. EPA, “Air pollution; standards of performance for new stationary sources: Electric generating units; emissions
test,” 70 Federal Register 61081, October 20, 2005, and “Prevention of significant deterioration and nonattainment
new source review; debottlenecking, aggregation, and project netting,” 71 Federal Register 54235, September 14,
2005. The September 2006 proposal, parts of which were finalized January 13, 2008, would limit application of NSR
by allowing plants to consider emissions only from the unit undergoing modification, rather than the entire plant, in
determining whether NSR applies.
56
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Clean Air Issues in the 111th Congress
emissions reductions from other CAA [Clean Air Act] requirements that are more efficient,”61 an
allusion to CAIR.
Since that time, both of these justifications have disappeared—the Fourth Circuit decision being
overturned by the Supreme Court, and the “more efficient” reduction requirements (CAIR)
having been vacated by the D.C. Circuit. Thus, the rule has not been promulgated.
At Congress’s direction, the National Academy of Sciences began a review of the NSR program
in May 2004. An interim report, released in January 2005, said the committee had not reached
final conclusions, but it also said, “In general, NSR provides more stringent emission limits for
new and modified major sources than EPA provides in other existing programs” and “It is ...
unlikely that Clear Skies [the Bush Administration’s proposed multi-pollutant legislation] would
result in emission limits at individual sources that are tighter than those achieved when NSR is
triggered at the same sources.”62 The final report, issued July 21, 2006, was ambivalent in many
of its conclusions, but it found that
[m]ore than 60% of all coal-fired electricity-generation capacity in the United States
currently lacks the kinds of controls for SO2 and NOx emissions that have been required
under NSR. Also, the older facilities are more likely than newer facilities to undergo
maintenance, repair, and replacement of key components, so a substantial portion of
emissions from the electricity-generating sector is potentially affected by the NSR rule
changes.63
Besides the NAS study, on April 21, 2003, the National Academy of Public Administration
(NAPA) released a report commissioned by Congress that made sweeping recommendations to
modify NSR. The study panel recommended that Congress end the “grandfathering” of major air
emission sources by requiring all major sources that have not obtained an NSR permit since 1977
to install Best Available Control Technology or Lowest Achievable Emissions Rate control
equipment. In the interim, the NAPA panel concluded, the EPA and the Department of Justice
should continue to enforce NSR vigorously, especially for changes at existing facilities.64
The continuing controversy over NSR, the court decisions involving CAIR and CAMR, and the
prominence of the electric power industry’s CO2 emissions might all be addressed through multipollutant legislation. On the other hand, legislation addressing emissions from utilities found
itself competing with economy-wide climate change cap-and-trade legislation which had priority
both in the 111th Congress and the Administration.
61
70 Federal Register 61083, October 20, 2005.
62
National Research Council of the National Academies, Interim Report of the Committee on Changes in New Source
Review Programs for Stationary Sources of Air Pollutants (Washington, DC: The National Academies Press, 2005), p.
27.
63
National Research Council of the National Academies, New Source Review for Stationary Sources of Air Pollutants
(Washington, DC: The National Academies Press, 2006), Prepublication Copy, p. 3.
64
National Academy of Public Administration, A Breath of Fresh Air: Reviving the New Source Review Program,
Summary Report, April 2003, p. 3.
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Clean Air Issues in the 111th Congress
Air Quality Standards
Background
Air quality has improved substantially since the passage of the Clean Air Act in 1970: annual
emissions of the six most widespread (“criteria”) air pollutants have declined nearly 180 million
tons (59%), despite major increases in population, motor vehicle miles traveled, and economic
activity. 65 Nevertheless, the goal of clean air continues to elude many areas, in part because
scientific understanding of the health effects of air pollution has caused EPA to tighten standards
for most of the criteria pollutants.
The most widespread problems involve ozone and fine particles. As of September 2010, 119
million people lived in areas classified “nonattainment” for the ozone National Ambient Air
Quality Standard (NAAQS);66 70 million lived in areas that were nonattainment for the fine
particle (PM2.5) NAAQS.67 EPA attributes at least 33,000 premature deaths and millions of lost
work days annually to exceedances of the PM2.5 standard. Recent research has tied ozone
pollution to premature mortality as well.
Violations of the ambient air quality standards for the other four criteria pollutants are not as
widespread, but EPA is engaged in (or has recently completed) reviews indicating that health
effects of most of these pollutants are more serious than previously thought. At present, for
example, no areas exceed the NAAQS for sulfur dioxide (SO2), but in a recent review, EPA
determined that between 2,300 and 5,900 premature deaths can be avoided annually by
strengthening that standard. Thus, the agency has promulgated a new SO2 standard under which
as many as 59 counties could be designated nonattainment, based on the most recent monitoring
data.68
Table 1 summarizes EPA’s recent efforts to review the NAAQS and implement revisions,
including the next steps for each of the six criteria pollutants. Revisions for five of the six
pollutants (ozone, PM, lead, NO2, and SO2) have been completed since 2006, with the standards
being made more stringent in each case (three of the five were subsequently challenged in court
and two of these three were remanded to the agency for further revisions). Reviews of the
NAAQS for carbon monoxide and the two remanded standards (ozone and PM) are to be
completed in 2010 or 2011.69
65
See U.S. EPA, “Air Emissions Summary Through 2005,” at http://www.epa.gov/air/airtrends/2006/
emissions_summary_2005.html, updated with data from 2008 in U.S. EPA, “Air Quality Trends,” at
http://www.epa.gov/airtrends/aqtrends.html#comparison. The six criteria pollutants are ozone, particulate matter,
carbon monoxide, sulfur dioxide, nitrogen oxides, and lead.
66
Data for ozone nonattainment areas are from the U.S. EPA “Green Book,” at http://www.epa.gov/oar/oaqps/greenbk/
gntc.html.
67
Fine particles, as defined by EPA, consist of particulate matter 2.5 micrometers or less in diameter, abbreviated as
PM2.5. Data for PM2.5 nonattainment areas are also from the U.S. EPA “Green Book,” at http://www.epa.gov/oar/oaqps/
greenbk/qntc.html.
68
http://www.epa.gov/air/sulfurdioxide/pdfs/20100602map0709.pdf. The 59 potential nonattainment counties were
identified using the most recent available monitoring data (2007-2009). EPA is likely to use 2009-2011 or later data
when it comes time to actually designate the areas. Additional monitors will also be sited.
69
There are CRS reports on three of the NAAQS revisions: CRS Report R41062, Ozone Air Quality Standards: EPA’s
Proposed January 2010 Revisions, CRS Report RL34762, The National Ambient Air Quality Standards (NAAQS) for
(continued...)
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Clean Air Issues in the 111th Congress
Table 1. Status of NAAQS Reviews
Monitoring
Issues?
Pollutant
Last Revision
Court Action?
Next Steps
ozone
March 27, 2008;
revised
standards were
proposed
January 19, 2010.
In response to
suits filed by 15
states (Mississippi
v. EPA), EPA
agreed to
reconsider the
March 2008
standards.
Final standards
are expected to
be promulgated
by the end of
December,
2010.
Implementation
of the 2008
NAAQS is
stayed pending
review.
Only 675 of the
nation’s 3,000
counties have
ozone monitors:
Between 515
and 650 of these
counties
exceeded the
proposed
standard based
on the most
recent
monitoring data.
Ozone is
increasingly seen
as a regional
pollutant that
affects rural as
well as urban
areas, so more
counties may
need monitors.
On July 14, 2009,
EPA proposed to
require that
states monitor
ozone
concentrations
in rural as well
as urban areas.
March 2008
primary (healthbased) standards
were set at a
level less
stringent than
recommended
by EPA’s science
advisers. The
revision also did
not act on
proposed
changes to the
form of the
secondary
(welfare)
standard that
would have
more accurately
addressed
impacts on crops
and forests. The
January 2010
proposal
addresses both
of these issues.
particulate
matter (PM2.5
and PM10)
October 17,
2006
The D.C. Circuit
remanded the
2006 PM2.5
standards to EPA
in February 2009
(American Farm
Bureau Federation
v. EPA).
EPA expects to
propose a PM2.5
NAAQS by
February 2011,
with promulgation of final
standards by
October 2011.
Environmental
groups would
like to see
additional
monitoring in
areas with
expected high
concentrations
(e.g., along
highways, near
ports, etc.).
October 2006
primary
standards for
PM2.5 were set at
levels less
stringent than
recommended
by EPA’s science
advisers.
In an agency
document
released July 2,
2010, staff
recommended
substantially
more stringent
standards.
Comments
(...continued)
Particulate Matter (PM): EPA’s 2006 Revisions and Associated Issues, and CRS Report RL34479, Revising the
National Ambient Air Quality Standard for Lead.
Congressional Research Service
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Clean Air Issues in the 111th Congress
Monitoring
Issues?
Pollutant
Last Revision
Court Action?
Next Steps
sulfur dioxide
(SO2)
On June
22,2010, EPA
revised the
NAAQS,
focusing on
shorter-term
(1-hour)
exposures. The
prior standards
(for 24-hour and
annual
concentrations),
which were
revoked as part
of the revision,
were set in
1971. The new
short-term
standard is
substantially
more stringent,
replacing a 24hour standard of
140 parts per
billion (ppb) with
a 1-hour
maximum of 75
ppb.
The D.C. Circuit
remanded the
SO2 standard to
EPA in 1998,
following an
agency review
that left the
standard
unchanged. The
court found the
Administrator
had failed
adequately to
explain her
conclusion that
no public health
threat existed
from short term
exposures to
SO2. (American
Lung Association
v. EPA)
EPA intends to
designate
nonattainment
areas by June
2012.
The current SO2
monitoring
network is not
primarily
configured to
monitor
locations of
maximum shortterm
concentrations.
The network
needs 41 new
monitoring sites,
according to
EPA. In a change
from the
agency’s
December 2009
proposal, EPA
will rely
primarily on
dispersion
modeling to
assess
compliance with
the standard.
Since 1971, EPA
had conducted
three reviews of
the SO2 standard
without changing
it.
carbon
monoxide (CO)
Current primary
standard was set
in 1971. EPA
revoked a
secondary
standard in 1985.
The U.S. District
Court for the
Northern
District of
California has
ordered EPA to
review the CO
NAAQS by May
13, 2011.
(Communities for
a Better
Environment v.
EPA)
EPA must
propose any
revision to the
CO NAAQS by
January 28, 2011,
with final action
by August 12,
2011.
Uncertain.
Emissions of
CO, largely from
motor vehicles,
have declined
56% since 1980,
and few areas
violate the
existing CO
NAAQS.
nitrogen dioxide
(NO2)
EPA completed a
review and
promulgated a
new 1-hour
standard
February 9,
2010. The new
standard is in
addition to the
previous annual
average
standard, which
was set in 1971.
A suit filed in
2005 charged
that EPA had
failed to review
the NO2
standard in the
last 5 years, as
required by the
Clean Air Act
(Center for
Biological Diversity
v. Johnson).
Under a 2007
consent decree,
EPA proposed
EPA expects to
identify
nonattainment
areas by January
2012. However,
the agency
believes most
areas will be
“unclassifiable,”
due to the lack
of adequate
monitoring.
Once an
expanded
network of NO2
Under EPA’s
new monitoring
network, a
monitor will be
required near a
major road in
any urban area
with a
population of
350,000 or
more. (The
majority of NO2
emissions come
from motor
vehicles.)
There are no
nonattainment
areas for the
annual standard,
and only Cook
County, IL
(Chicago)
violates the new
1-hour standard
using current
monitoring data.
NO2 emissions
have been more
stringently
controlled even
Congressional Research Service
Comments
25
Clean Air Issues in the 111th Congress
Pollutant
lead
Last Revision
November 12,
2008
Congressional Research Service
Monitoring
Issues?
Court Action?
Next Steps
revisions to the
primary standard
July 15, 2009,
and promulgated
the revisions in
February 2010.
monitors is fully
deployed and
three years of air
quality data have
been collected,
the agency will
redesignate
areas (in 2016 or
2017) based on
air quality data
from the new
monitoring
network.
Communitywide
concentrations
would also be
monitored in
urban areas with
populations of
1,000,000 or
more.
though there
have not been
recent violations
of the NO2
standard,
because nitrogen
oxides
contribute to the
formation of
ozone, the
standard for
which has been
reviewed and
strengthened
several times.
Both
environmental
groups (which
challenged the
adequacy of the
monitoring
requirements)
and industry
(which
challenged the
standard itself)
have petitioned
for review
(Missouri Coalition
for the
Environment v.
EPA and Coalition
of Battery
Recyclers
Association v.
EPA). EPA
granted a
petition for
reconsideration
of the
monitoring
requirements in
July 2009.
Revised
monitoring rules
were proposed
December 23,
2009.
In July 2009, EPA
agreed to review
the monitoring
portions of its
November 2008
NAAQS. At
least 24 of the
50 states,
including some
with major
sources of lead
emissions, had
no lead monitors
at all. Under the
2008 regulations,
101 metro areas
(those with
populations
greater than
500,000) would
be required to
have monitors as
would an
estimated 135
areas that have
sources of lead
emissions
greater than or
equal to one ton
per year.
Proposed
regulations
would lower the
source threshold
to 0.5 tons.
EPA’s November
2008 action
reduced the
standard by 90%,
from 1.5
micrograms per
cubic meter
(μg/m3) to 0.15
μg/m3.
Environmental
groups, while
generally pleased
with the
NAAQS itself,
petitioned for
reconsideration
of the
monitoring
requirements,
arguing that EPA
should require
more locations
near emission
sources to have
monitors.
Industry groups
believe the
standard itself is
too stringent.
The lawsuit
challenging the
standard itself is
proceeding.
16
nonattainment
areas were
designated in
November 2010.
Comments
26
Clean Air Issues in the 111th Congress
Judicial Reviews
As the table indicates, court challenges have played a key role in bringing about the NAAQS
reviews, and in causing further review after the NAAQS have been promulgated. Reviews of
most of the standards were stimulated at least in part by court cases: EPA is statutorily required to
review the NAAQS every five years, and its failure to do so can be addressed by citizen suits.
At the other end of the process, once the agency’s review of a NAAQS is completed, the
standards are almost invariably challenged in court. In the case of both particulate matter and
ozone, judicial review has led to a remand of the standards that EPA promulgated in 2006 and
2008 respectively. The agency has now agreed to promulgate further revisions to these standards
in 2010 and 2011.
CASAC’s Role
As the table indicates, in at least two cases, EPA’s revised standards have been remanded at least
in part because the agency did not follow the advice of its independent science advisors, the
Clean Air Scientific Advisory Committee (CASAC). EPA is not required by statute to follow
CASAC’s recommendations; the act requires only that the Administrator set forth (in the Federal
Register notice in which she proposes a NAAQS) any pertinent findings, recommendations, and
comments made by CASAC and, if her proposal differs in an important respect from any of the
recommendations, provide an explanation of the reasons for such differences. 70 But the failure to
follow CASAC recommendations almost inevitably raises the question of whether the
Administrator’s decision will be judged arbitrary and capricious in a judicial review.
In the recent revisions of both the ozone and PM standards, CASAC made detailed objections to
the Administrator’s final decisions. The committee’s description of the process as having failed to
meet statutory and procedural requirements played an important role during judicial review. This
raises the question of whether Congress might opt to strengthen CASAC’s statutory role in the
review process, or limit the Administrator’s authority to reject CASAC’s advice.
Adequacy of Monitoring
A feature common to many of the recent NAAQS reviews has been EPA’s finding that the current
monitoring network is inadequate to determine whether or not many areas of the country are in
attainment of the standards. In several cases, such as for lead and sulfur dioxide, more extensive
monitoring networks had been partly dismantled by the time the standards were reviewed, after
years of indicating compliance with older, less stringent standards. In other cases, such as PM and
NO2, the monitoring network was not designed to measure the kinds of exposure that current
research identifies as a cause of concern (e.g., exposure to fine particles near highways). As a
result, EPA and the states will need to devote resources in the next few years to expanding and
refocusing the monitoring networks in order to identify areas where air quality does not meet new
standards.
70
The requirement is found in Section 307(d)(3) of the act.
Congressional Research Service
27
Clean Air Issues in the 111th Congress
NAAQS Implementation
Although most of the NAAQS standards are likely to have been revised by the end of 2011—
ultimately stimulating billions of dollars in expenditures on pollution control—the impact of the
new standards will be gradual. A NAAQS does not directly limit emissions; rather, a primary
NAAQS represents the Administrator’s formal judgment regarding the level of ambient pollution
below which public health will be protected with an adequate margin of safety; a secondary
standard reflects her judgment as to the level of ambient pollution necessary to protect public
welfare, including protection of the environment, water quality, building materials, etc.
Promulgation of a NAAQS sets in motion a lengthy process under which states and the EPA first
identify nonattainment areas. Those areas then undertake a complicated implementation process.
The first step, designation of nonattainment areas, generally takes at least two years after a
standard is promulgated, and in many cases longer, if a new monitoring network needs to be
established. After nonattainment areas are formally designated, the states generally have three
years to submit State Implementation Plans (SIPs) that identify the specific regulations and
emission control requirements that will bring the area into attainment.
Whether more stringent NAAQS will lead to stronger federal emission controls for the sources of
pollution—in addition to the controls contemplated by individual states or metropolitan areas—is
likely to be an important issue. Several of the criteria pollutants have impacts across state lines,
far from the source of emissions; others (notably ozone) form in the atmosphere as the result of
chemical reactions involving precursors that may have been emitted many miles upwind. Thus,
measures taken by individual states and nonattainment areas to control emissions within their
borders may be inadequate for the areas to attain a NAAQS. Federal standards for cars, trucks,
power plants, and other major pollution sources could need strengthening for many areas to be
able to attain the NAAQS.
Congress has given EPA the authority to strengthen such emission standards; but Congress may
still act to review the implementation of that authority.
Author Contact Information
(name redacted)
Specialist in Environmental Policy
[redacted]@crs.loc.gov, 7-....
Congressional Research Service
28
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