EFO 2019 Air Quality Regulatory Updates Robert D. Singletary - PowerPoint PPT Presentation

EFO 2019 – Air Quality Regulatory Updates Robert D. Singletary robert.singletary@crowedunlevy.com October 9, 2019

EF EFO 20 2019 9 – Air Air Qua Quality R lity Regul egulat ator ory y Updat pdate Upd pdat ates es on on three t three top opics ics: • CEMS Regulatory Interpretation • Clean Power Plan/Affordable Clean Energy Rule • California Fuel Standard »

CEM CEMS REG REGULA ULATOR ORY Y IN INTER TERPRET PRETATION TION Timeline Ti meline: • Ap April ril 18, 8, 20 2017 7 - DEQ’s Tulsa office requested clarification from EPA R6 on: - Reporting of CMS Downtime - Calculation of Hourly Average • Ju June ne 26 26, 20 , 2017 7 - EPA R6 responded to DEQ and issued a Regulatory Interpretation • Su Summ mmer/F er/Fall all 20 2018 - DEQ requested EPA R6 to withdraw the Regulatory Interpretation

CEM CEMS REG REGULA ULATOR ORY Y IN INTER TERPRET PRETATION TION Timeline Ti meline (C (Cont.) ont.): • Sp Spring ring 20 2019 9 - DEQ continued working with EPA R6 to get the Regulatory Interpretation withdrawn • Ma March ch 18, 8, 20 2019 9 - Regulatory Interpretation was published in the Federal Register - Regulatory Interpretation for Continuous Monitoring System Downtime and Emission Reporting, Control No. 1700037, 84 Fed.Reg. 9783 »

CEM CEMS REG REGULA ULATOR ORY Y IN INTER TERPRET PRETATION TION Timeline Ti meline (C (Cont.) ont.): • Ma May 17, 7, 20 2019 9 - Petition for Review challenging the Regulatory Interpretation filed in D.C. Circuit - American Forest & Paper Association, Inc. and American Wood Council v. EPA , Case No. 19-1108 (D.C. Cir.) • Ju June ne 13, 3, 20 2019 9 - EPA withdrew the Regulatory Interpretation - EPA letter to DEQ - EPA agreed to “post disclaimer” to ADI »

CEM CEMS REG REGULA ULATOR ORY Y IN INTER TERPRET PRETATION TION Lesso Les sons ns: • Need to monitor regulatory developments • Example of how Regulators and Regulated Industry can work together to resolve common concerns »

CL CLEAN EAN PO POWE WER PLAN R PLAN/AFF /AFFORD ORDABLE CLEA ABLE CLEAN N EN ENER ERGY Y RULE ULE Cl Clean ean Power er Pl Plan an: • Published in the Federal Register on October 23, 2015 • Purpose was to reduce CO 2 emissions from existing power plants - BSER considered on-site and off-site measures (3 building blocks) to set National CO 2 emission standards - State specific reduction targets • BSER based (in part) on “Outside the fenceline ” measures »

CL CLEAN EAN PO POWE WER PLAN R PLAN/AFF /AFFORD ORDABLE CLEA ABLE CLEAN N EN ENER ERGY Y RULE ULE Clea lean n Power er Plan lan: • La Laws wsuits uits - - State of West Virginia, et al. v. EPA , Case No. 15-1363 (consolidated with 38 other cases)(D.C. Cir.) - State of North Dakota v. EPA , Case Nos. 15-1363 and 17- 1014 (consolidated with 16 other cases)(D.C. Cir.) »

States Participating in Clean Power States Participating in Litigation Consolidated Petitions: West Virginia et al. v. EPA et al., D.C. Circuit No. 15-1363

CL CLEAN EAN PO POWE WER PLAN R PLAN/AFF /AFFORD ORDABLE CLEA ABLE CLEAN N EN ENER ERGY Y RULE ULE Clean Cl ean Power er Pl Plan an (C (Cont.) ont.): • Feb ebruar ruary y 9, 9, 20 2016 6 - SCOTUS stay - Stayed implementation/enforcement of CPP until legality resolved - First time SCOTUS stayed a matter pending before the D.C. Circuit - Considerations - “likelihood of success on the merits” and “irreparable harm” • Se Sept ptemb ember er 27, 7, 20 2016 6 - D.C. Circuit held en banc oral argument

CL CLEAN EAN PO POWE WER PLAN R PLAN/AFF /AFFORD ORDABLE CLEA ABLE CLEAN N EN ENER ERGY Y RULE ULE Clea lean n Power er Plan lan (C (Cont.) ont.): • D.C D.C. . Circuit cuit st stay y – Court of Appeals stayed the case on April 28, 2017, based on current administration’s intent to replace CPP - Exec Ex ecutiv utive e Or Order der 1378 783 3 – March 28, 2017 Specifically directed EPA to review and initiate reconsideration proceedings to “suspend, revise , or rescind” the CPP “as appropriate and consistent with law.” - Fede ederal ral Regi egist ster er Noti tice ce – March 28, 2017 Initiating review of CPP

CL CLEAN EAN PO POWE WER PLAN R PLAN/AFF /AFFORD ORDABLE CLEA ABLE CLEAN N EN ENER ERGY Y RULE ULE Affor Af ordable dable Clea lean n En Energy ergy Rul ule: • Pub ublished lished - Federal Register on July 8, 2019 (84 Fed.Reg. 32520) • Ef Effectiv ective - September 6, 2019 • Allows States to establish GHG emission standards using BSER measures limited to on-site heat-rate improvements for existing coal- fired power plants - No off-site measures required or considered

CL CLEAN EAN PO POWE WER PLAN R PLAN/AFF /AFFORD ORDABLE CLEA ABLE CLEAN N EN ENER ERGY Y RULE ULE Affor Af ordable dable Cl Clean ean En Energy ergy Rul ule e (C (Cont.) ont.): • CPP PP Lawsuits wsuits Di Dism smisse issed d - D.C. Circuit dismissed CPP challenges as moot on September 17, 2019 • ACE E Rul ule e la lawsuits wsuits st status atus - - Deadline to Challenge – September 6, 2019 - Numerous lawsuits filed • Leg egal al debat ebate e – Legal challenges for both CPP and ACE Rule center on interpretation of BSER - Precedent on scope of EPA authority under § 111(d)? • 2020 2020 Pr Presidential esidential El Election ection • Continued ntinued Reg egulat ulator ory y Uncer ncertaint tainty

CAL CALIF IFORNIA ORNIA FU FUEL EL STAND ANDARD ARD One Na One Natio tional nal Pr Program ogram Rul ule - • Promul omulgat gated ed - EPA/NHTSA - September 19, 2019 • Pu Purpos pose – Provide nationwide uniform fuel economy and GHG emission standards for automobile and light duty trucks Fede ederal ral Preem reempti ption on - • When State law and Federal law conflict, Federal law preempts state law due to the Supremacy Clause (U.S. Const. art. VI., § 2)

CAL CALIF IFORNIA ORNIA FU FUEL EL STAND ANDARD ARD Statu St atutor ory y Provisions visions – • Clea lean n Ai Air r Act ct § 20 209( 9(a) a) provides: No State . . . shall adopt or attempt to enforce any standard relating to the control of emissions from new motor vehicles or new motor vehicle engines . . . . • Statute authorizing DOT to establish average fuel economy standards (49 U.S.C. § 32919(a)) provides: When an average fuel economy standard prescribed under this chapter is in effect, ... a State may not adopt or enforce a law or regulation related to fuel economy standards or average fuel economy standards for automobiles . . . .

CALIFORNIA FUEL STANDARD Aut utho hority rity to G o Gra rant nt Wai aiver er – • Clean Air Act § 209(b)(1) provides: The Administrator shall . . . waive application of this section to any State which has adopted standards . . . for the control of emissions from new motor vehicles or new motor vehicle engines prior to March 30, 1966, if the State determines that the State standards will be, in the aggregate, at least as protective of public health and welfare as applicable Federal standards. . No No suc uch h wai aiver er shal all l be granted if the Administrator finds that – A. the determination of the State is arbitrary and capricious, B. B. such h Sta State e do does es no not nee t need su d such h Sta State e sta tandar ndards ds to o meet eet com ompellin pelling g an and d ext xtra raor ordina dinary y cond onditions itions, or C. such State standards and accompanying enforcement procedures are not consistent with section 7521(a) of this title.

CAL CALIF IFORNIA ORNIA FU FUEL S EL STAND ANDARD ARD EPA A Act ction ion on on Cal alif ifor ornia nia Req equests uests for or Wai aiver ers s (G (GHG HGs) s) – • Ma March ch 6, 6, 20 2008 08 – Request DENIED - Bush EPA denied California’s request for a waiver of CAA preemption for California’s GHG emission standards for MY 2009 -2016 vehicles ▪ Basis – California did not meet standard regarding co compelli pelling ng and d extraor traordinar dinary y conditions co ditions • Ju July ly 8, 8, 20 2009 09 – Previous denial reversed, request GRANTED - Obama EPA withdrew previous administration’s denial • Ja Janu nuar ary 9, y 9, 20 2013 3 – Request GRANTED - Obama EPA granted CARB’s request for waiver to enforce its Advanced Clean Car program regulations (GHG/ZEV standards for MY 2021-2025).

CAL CALIF IFORNIA ORNIA FU FUEL S EL STAND ANDARD ARD EPA EP A Actio ction n on on Cali alifornia ornia Req equests uests for or Wai aiver ers s (GHGs GHGs)( )(cont.) cont.) – • Sep September ember 19, 9, 20 2019 9 – Previous approval withdrawn, request DENIED - Trump EPA withdrew waiver granted by Obama EPA for MY 2021-2025 GHG/ZEV standards ▪ Avoid patchwork fuel economy requirements ▪ Not t compe pelling lling and nd ext xtrao raordin dinar ary y conditi nditions ons - Two Actions ▪ Withdrew California’s existing waiver for GHG emission standards; and ▪ Finalized NHTSA’s determination that EPCA preempts State GHG and ZEV programs, because they rela elated ed to fuel economy standards. - No Action on Standard ▪ Effectively locks in MY 2020 levels until the Safer Affordable Fuel Efficient (“SAFE”) Vehicle Rule is released