Ruling Blocks Thousands of Facilities from Increasing Pollution

WASHINGTON (March 17, 2006) -- A federal court today killed a Bush administration rule that would have sabotaged a key provision of the Clean Air Act. Agreeing with a coalition of public health and environmental groups, the U.S. Court of Appeals ruled that a loophole the Bush administration adopted for the law's new source review program would have allowed thousands of aging power plants and other industrial facilities to emit more air pollution, threatening the health of millions of Americans.

The U.S. Court of Appeals for the District of Columbia Circuit found that the administration's loophole contradicted the purposes of the Clean Air Act. "Indeed," the court stated, "EPA's interpretation would produce a 'strange,' if not an 'indeterminate,' result: a law intended to limit increases in air pollution would allow sources operating below applicable emission limits to increase significantly the pollution they emit without government review." The court refused to adopt what it called the Environmental Protection Agency's "Humpty Dumpty" upside-down world view. (Download a copy of the ruling.)

"This is a victory for public health," said Howard Fox, an attorney at Earthjustice, which represented six groups in the case. "It makes no sense to allow huge multi-million-dollar projects that drastically increase air pollution without installing up-to-date pollution controls or even notifying nearby residents."

The organizations in the lawsuit included Alabama Environmental Council, American Lung Association, Clean Air Council, Communities for a Better Environment, Delaware Nature Society, Environmental Defense, Group against Smog and Pollution, Michigan Environmental Council, Natural Resources Defense Council (NRDC), Ohio Environmental Council, Scenic Hudson, Sierra Club, Southern Alliance for Clean Energy, and U.S. PIRG.

"Irish eyes are surely smiling -- and we all will be breathing easier -- with this green court ruling on St. Patrick's Day," said John Walke, director of NRDC's Clean Air Program. "The court recognized the blarney in the administration's plan to gut a key part of the Clean Air Act and rejected it. Now thousands of dirty facilities will not be able to pollute more."

The Court of Appeals initially issued a stay in December 2003 blocking the loophole from taking effect. If the court had not issued the stay, the new rules would have gone into effect on December 26, 2003, in at least 17 states and territories, including California, Illinois, Massachusetts, Michigan, Minnesota, New Jersey, New York, Nevada and Pennsylvania. Industrial facilities in those states would have been able to take advantage of the new air pollution loophole immediately. The remaining states across the country would have been forced to adopt the loophole shortly thereafter.

Many of the nation's older power plants have operated long beyond their expected lifespans, polluting at excessively high levels, largely because utilities have rebuilt these grandfathered plants over time. Often they modified these facilities in ways that increased air pollution without complying with Clean Air Act requirements to install modern emissions controls.

The Clean Air Act's new source review program was designed to curb air pollution from these and other industrial facilities by requiring them to install up-to-date pollution controls whenever they made physical or operational changes that increased air pollution. The Environmental Protection Agency launched enforcement lawsuits against utility and refinery violators during the latter part of the Clinton administration for pollution increases that had resulted in millions of tons of air pollution.

The Bush administration wanted to derail these enforcement suits and eliminate future actions by changing the rules to allow companies to virtually rebuild their facilities and boost pollution levels without having to meet new source review program requirements.

The loophole created by the administration's new rule would have allowed more than 20,000 power plants, refineries and other industrial facilities to replace existing equipment with "functionally equivalent" equipment without undergoing the clean air reviews required by the new source review program if the cost of the replacement did not exceed 20 percent of that of the entire "process unit." This exemption would have applied even if a facility's air pollution increased by thousands or tens of thousands of tons as a result of the replacement.

"Today's victory means that thousands of Americans will not have their lives cut short because of the pollution that would have blown through this huge loophole," said Janice Nolen at the American Lung Association. "The court could not have told the EPA more clearly that they must follow the Clean Air Act as it is written, not as they wish it were written."

Emily Figdor, U.S. PIRG's clean air advocate, agreed. "Today's ruling is a tremendous victory for public health and the environment," she said. "The court slammed the door on the Bush administration's attempt to create a gaping loophole in the Clean Air Act for some of the nation's worst polluters."