EPA Proposes Regulating Greenhouse Gases under Clean Air Act

The U.S. Environmental Protection Agency (EPA) has released a proposed finding that current concentrations of greenhouse gas (GHG) emissions in the atmosphere endanger public health and welfare and that new motor vehicles (and engines) contribute to this endangerment. The proposal does not include any specific rules, yet it opens the door for EPA to control these emissions under the Clean Air Act (CAA).  Such regulations would be developed in a subsequent rulemaking proceeding unless U.S. Congress moves ahead with legislation addressing climate change. EPA's so-called "endangerment finding" implements the U.S. Supreme Court's landmark 2007 decision, which held that EPA has the authority to regulate GHGs. EPA published on April 24 a proposed endangerment finding that current and projected future concentrations of six key greenhouse gases - carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF6) - in the atmosphere threaten the public health and welfare of current and future generations. To this end, EPA proposed to cumulatively define these six GHGs as a single "air pollutant." EPA also determined that combined emissions of certain GHGs from new motor vehicles and motor vehicle engines contribute to the atmospheric concentrations of these key GHGs and hence endanger public health and welfare.  See 47 FR 18886. (EPA's analysis is presented in the context of emissions from new cars and trucks because the proposal was issued under the authority of section 202 of the Clean Air Act, which applies only to motor vehicles - see "Background" section below.) Where Endangerment Leads At this time, EPA has chosen to issue the proposed endangerment finding without proposing emission control standards. Following the finalization of the endangerment finding, if Congress does not act, EPA will be forced by timelines under the Clean Air Act to propose GHG emission standards for new motor vehicles under the CAA Section 202(a). AGC of America does not support the regulation of GHG emissions from motor vehicles under the CAA as it could spark a whole host of unmanageable regulations that would impede the construction and/or expansion of most buildings (i.e., new source performance standards, construction permits and operating permits). In fact, EPA Administrator Lisa Jackson agrees that the Clean Air Act is the wrong instrument for regulating GHGs, stating in a press release EPA's preference that Congress act so the agency won't have to. If Congress does not act, EPA will have to use the regulatory tool it has -- the Clean Air Act -- and hundreds of thousands of sources of CO2 not currently regulated could come within the air permit programs set up under the Act. Even excluding any future EPA regulation, the endangerment finding alone may contribute to greater complexity in the NEPA process. Several sources are indicating that the endangerment finding would support efforts to have federal agencies account for the GHG emissions that result from their projects in their environmental impact statements. The analysis of potential future GHG emissions from a given federal action could add considerable time to a process that often already takes years to perform - further delaying critical infrastructure projects. Public comment on the proposed endangerment finding is due on or before June 23, 2009. For more information and to submit comments, go to www.regulations.gov and access the rulemaking docket for EPA-HQ-OAR-2009-0171. Additional information is available on EPA's Web site at http://www.epa.gov/climatechange/endangerment/index.html. Congressional Action Congressional action could preempt regulation of GHG emissions under the CAA. The proposed Waxman-Markey bill, titled the "American Clean Energy and Security Act of 2009," contains four titles that address (1) "clean" energy sources; (2) energy efficiency; (3) a federal GHG cap-and-trade program, and (4) measures offering some protection to consumers/industries that many be hurt by a U.S. transition to carbon controls.  The bill would direct EPA not to establish federal air standards for GHGs and it includes provisions to exempt GHG emissions from certain sections of the CAA.  See related article in this issue of the Observer. Background A 2007 U.S. Supreme Court decision (Massachusetts v. EPA, 549 U.S. 497 (2007)) directed EPA to determine whether or not emissions of GHGs from new motor vehicles cause or contribute to air pollution which may reasonably be anticipated to endanger public health or welfare. In making these decisions, EPA must follow the language of section 202(a) of the CAA. In response, EPA issued the proposed endangerment finding on April 24, 2009. In July 2008, and also in response to the Supreme Court decision, EPA issued an advanced notice of proposed rulemaking on regulating GHG emissions from new motor vehicles under the CAA. The stated purpose of the ANPR was to take comment on the potential implications of an endangerment finding.  AGC of America, several industry and government agencies responded with comments that regulating GHG emissions under any section of the CAA would likely trigger a cascade of regulatory programs under the other sections of the Act. The effect could be disastrous for the economy, as EPA would need to issue hundreds of thousands of permits for building construction and major renovation, develop and implement new source performance standards, and require states to address GHG emissions in their state implementation plans (which could jeopardize highway funding). It would also trigger Title V operating permits that would impact several small businesses by requiring permits for minor emissions of GHGs. Title V also includes a citizen suit provision that could have severe consequences because each permit application could be challenged by any citizen. For additional information, contact Melinda Tomaino at (703) 837-5415 or tomainom@agc.org.