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EPA v. EME Homer City Generation, L.P. | 188 L.Ed.2d. 775, 572 U.S. 489, 134 S. Ct. 1584 (2014)

Regulating air pollution isn’t always a breeze. In EPA versus EME Homer City Generation, we’ll see if the Environmental Protection Agency, or EPA, reasonably interpreted the Clean Air Act’s Good Neighbor Provision when it created a new rule on downwind pollution.

Air pollution from upwind states that travels downwind can prevent downwind states from meeting National Ambient Air Quality Standards, or NAAQS. The EPA requires that states address downwind pollution in their state implementation plan, or SIP, as part of the Good Neighbor Provision. Every state must submit a SIP, and if a state fails to submit an adequate SIP, the EPA must create a federal implementation plan, or FIP, within two years. In twenty eleven, the EPA created the Cross-State Air Pollution Rule, or Transport Rule, which limited emissions in twenty-seven upwind states. Under the Transport Rule, an upwind state contributes significantly to a downwind state’s nonattainment of NAAQS if, first, the state produced one percent or more of NAAQs in at least one downwind state. And second, if the pollution could be eliminated in a cost-effective manner as determined by the EPA. Upwind states were then obligated to eliminate all the emissions that met both criteria. A state would also violate the Transport Rule if it failed to submit an adequate SIP that addressed downwind pollution, in which case the EPA would create a FIP for the state. Multiple industry groups and state and local governments petitioned the DC Circuit to review the Transport Rule.

The court of appeals vacated the Transport Rule, finding that the rule exceeded the EPA’s authority in two ways. First, the EPA would create FIPs before giving states a meaningful opportunity to adopt their own SIPs. Second, unlike NAAQS, which give states a clear numerical target, the value of the Good Neighbor Provision was unknown until the EPA calculated the state’s emission budget. The United States Supreme Court granted cert.

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