North Dakota v. EPA

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On April 24, 2020, the U.S. Department of Justice (DOJ) filed a status report in the proceedings challenging the Obama administration’s new source performance standards for greenhouse gas emissions from new, modified, and reconstructed power plants. The proceedings have been held in abeyance since August 2017 while EPA considers whether and how to amend the regulations. In the status report, DOJ said EPA’s work had been slowed by the COVID-19 pandemic, but that EPA intended and expected to be in a position to take final action on its proposed amendments to in the summer of 2020.

EPA reported to the D.C. Circuit in a status report that it was continuing to review the new source performance standards and that it believed the cases should remain in abeyance pending the conclusion of EPA's review and any resulting forthcoming rulemaking.

The D.C. Circuit ordered—on its own motion—that the cases challenging the carbon dioxide standards for new, modified, and reconstructed power plants (NSPS) remain held in abeyance pending further order of the court, with status reports to be filed at 90-day intervals.

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On April 28, 2017, the D.C. Circuit Court of Appeals granted the U.S. Environmental Protection Agency’s (EPA’s) motion to hold the cases challenging the greenhouse gas standards for new power plants in abeyance while EPA undertakes its review of the regulations. The court ordered that the cases be put on hold for 60 days and that EPA file status reports every 30 days. The court further ordered the parties to file supplemental briefs addressing whether the cases should be remanded to EPA rather than held in abeyance. Those briefs were to be submitted by May 15. In Executive Order No. 13783 issued on March 28, 2017, President Trump ordered EPA to review the standards and, if appropriate, to suspend, revise, or rescind them.

Two days after President Trump signed the Promoting Energy Independence and Economic Growth executive order on March 28, the D.C. Circuit cancelled oral arguments scheduled for April 17 in the proceedings challenging EPA’s new source performance standards (NSPS) for carbon dioxide emissions from new, modified, and reconstructed power plants. The executive order directed EPA to review both the NSPS and the Clean Power Plan (CPP), which established carbon dioxide emission limits for existing power plants, and also indicated that the attorney general should request stays in the proceedings challenging the NSPS and CPP. On the same day that the president signed the order, the Department of Justice filed notices of the executive order, EPA’s review of the regulations, and potential forthcoming rulemaking, and moved to hold the NSPS and CPP cases in abeyance. Respondent-intervenors indicated they would oppose the motions to hold the cases in abeyance. Earlier in the month, the D.C. Circuit assigned Judges Sri Srinivasan, Cornelia Pillard, and Karen Lecraft Henderson to hear the NSPS case.

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Opponents of EPA’s new source performance standards (NSPS) for greenhouse gas emissions from fossil fuel-fired power plants filed their reply briefs in the D.C. Circuit Court of Appeals. Oral argument was scheduled for April 17, 2017. The group of 24 states opposing the NSPS argued that EPA had misstated the legal standard for determining whether the “best system of emissions reduction” (BSER) was adequately demonstrated and that the record did not support EPA’s determination that the BSER was adequately demonstrated when the correct legal standard was applied. The states also said that any ambiguity should be resolved in the states’ favor because energy policy was an area of traditional state concern and that EPA had failed to reasonably consider costs and benefits had failed to make required findings.

Non-state petitioners argued in their reply brief that the BSER was not adequately demonstrated, that the BSER improperly relied on off-site unregulated parties, and that EPA’s “achievability” analysis was flawed because it did not examine what coal-fired steam units could achieve. The non-state petitioners also argued that requiring coal-fired plants but not gas-fired plants to use carbon capture and sequestration constituted unlawful disparate treatment.

In a separate reply brief, North Dakota reiterated its argument that EPA’s failure to separately regulate power plants fired by lignite coal made the standards invalid.

The D.C. Circuit denied a request by petitioners and petitioner-intervenors for extension of the briefing schedule. The extension was sought to allow the parties to determine whether an alternative resolution of the proceedings could be achieved with the incoming Trump administration, in which case there might be no need for reply briefs. Oral argument was currently scheduled for April 17, 2017.

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In early December, EPA submitted a brief defending its New Source Performance Standards for carbon dioxide emissions from new, modified, and reconstructed fossil fuel-fired power plants. EPA asserted that its selection of highly efficient supercritical pulverized coal boilers implementing partial carbon capture and sequestration (CCS) as the best system of emission reduction for new steam generating units was reasonable. EPA defended its decision not to create a subcategory for new power plants that burn lignite coal, for which some petitioners and intervenors had argued that partial CCS was not adequately demonstrated. EPA also said that it had reasonably considered the costs of partial CCS at an industry-wide level as well as for individual plants and that it appropriately declined to use a monetized cost-benefit analysis. EPA also argued that it had reasonably explained why the best system of emission reduction for new natural gas-fired combustion turbines did not include partial CCS, that it had established appropriate standards for modified and reconstructed steam units, that it was not required to issue a new endangerment finding for carbon dioxide emissions from fossil fuel-fired power plants (or, alternatively, that the record constituted such a finding), and that it had properly declined to docket emails that related to superseded proposals for emission standards . Later in December, a number of parties joined EPA in defending the standards: environmental and public health organizations; 18 states, Washington D.C., and New York City; power companies; CCS scientists; the operator of a CCS facility; experts on technology innovation and diffusion; and the Institute for Policy Integrity at the New York University School of Law.

A brief from petitioner-intervenors Lignite Energy Council and Gulf Coast Lignite Coalition focused on the rule’s application to lignite-fired facilities.

North Dakota filed its own opening brief focused on the application of the standards to power plants fueled by lignite coal. North Dakota argued that EPA had failed to establish that the best system of emission reduction for new steam generating units was adequately demonstrated for lignite or that the performance standard was achievable. North Dakota also contended that EPA’s failure to create a subcategory for lignite-fueled units was arbitrary and capricious.

The non-state petitioners also argued that the best system of emission reduction (BSER) was not adequately demonstrated and that EPA had not made the required endangerment and significant contribution findings. The non-state petitioners also asserted the performance standards for modified and reconstructed sources were unlawful, and that EPA’s inconsistent analysis of the availability of carbon capture and sequestration for coal-fired and gas-fired baseload units rendered the standards arbitrary and capricious. The non-state petitioners further argued that EPA had improperly rejected petitions for reconsideration that raised the issue of EPA’s ex parte contacts prior to the notice and comment period for the proposed rule.

Petitioners challenging EPA’s new source performance standards for carbon emissions from power plants filed their opening briefs in the D.C. Circuit Court of Appeals. The performance standard for new coal-fired electric utility steam generating units is based on a highly efficient supercritical pulverized coal unit with partial carbon capture and storage as the best system of emission reduction (BSER). A group of 23 states argued in an opening brief that EPA had not applied the correct legal standard to its determination that this BSER was adequately demonstrated; the states argued that EPA was required to show that “the entire selected system is commercially available for implementation at new, full-scale facilities.” The states also argued that EPA had failed to show that the BSER was adequately demonstrated, had failed to adequately consider costs and benefits, and not made the statutorily required endangerment and significant contribution findings required to set NSPS for a source category.

After the D.C. Circuit Court of Appeals consolidated appeals of EPA’s denial of reconsideration of its final performance standards for carbon emissions from new, modified, and reconstructed power plants with the challenges to the original rule, the parties submitted a proposed briefing schedule, which the D.C. Circuit approved on August 30. Briefing was scheduled to conclude on February 6, 2017.

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On June 24, 2016, the D.C. Circuit granted a motion to suspend the briefing schedule in pending challenges to the standards to allow parties to consolidate their challenges of the denial of reconsideration with their challenges to the original rule. Motions to consolidate must be filed by July 12, and motions for an amended briefing schedule must be filed by August 4.

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Petitioners challenging the United States Environmental Protection Agency’s (EPA’s) greenhouse gas emissions standards for new, modified, and reconstructed power plants asked the D.C. Circuit Court of Appeals to suspend briefing to permit the parties to add challenges to EPA’s denial of administrative petitions for reconsideration of the standards. EPA published notice of its denial of reconsideration in the May 6, 2016 issue of the Federal Register. The motion to suspend the briefing schedule said that three petitioners in the D.C. Circuit proceedings—Wisconsin, the Utility Air Regulatory Group, and Energy & Environment Legal Institute—would be challenging the denial of their petitions for reconsideration, and that the petitioners would seek to consolidate those challenges with the pending D.C. Circuit proceedings.

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