Yes, But Congress Might Want a More Tailored Fit

• Author: Doug Kendall
• Position: President of the Constitutional Accountability Center
• Pages: 53-54

MARCH/APRIL 2009 ❧ Page 53

Copyright © 2009, Environmental Law Institute®, Washington, D.C. www.eli.org.

Reprinted by permission from The Environmental Forum®, Match/April 2009

Th e fo r u m

of GHGs from automobiles and

large stationary sources will likely

automatically lead to GHG regula-

tion of a huge number of small sta-

tionary sources under the CAA’s Pre-

vention of Signif‌icant Deterioration

pre-construction permit program.

EPA’s recent Advance Notice of

Proposed Rulemaking recognizes the

very large number of small sources

that may require PSD permits if

GHGs are regulated under the

act, because a fuel-burning heat-

ing system for even a moderately

sized building emits more than 250

tons per year of carbon dioxide, the

threshold for PSD permitting.

One study estimated that 1.2 mil-

lion sources never regulated before

under the CAA emit more carbon

dioxide than the statutory threshold,

including of‌f‌ice, hotel and apart-

ment buildings as well as malls,

big box stores, sports arenas, large

houses of worship, and many other

categories. e ANPR discusses the

gridlock that could result from this

vast expansion of permitting author-

ity; I believe EPA underestimated

the problem and that recovery of the

construction industry in this coun-

try could be seriously impeded by

PSD permit delays.

Even worse, regulation of GHGs

could trigger a requirement for

establishment of National Ambi-

ent Air Quality Standards under

the CAA. Given the view of en-

vironmental organizations that

anthropogenic GHG emissions are

presently damaging both the public

health and welfare, we face the truly

frightening prospect that the entire

country will be declared to be a

carbon dioxide nonattainment area.

In that event, buildings that emit as

little as 100 tons per year of carbon

dioxide will be subject not to PSD,

but to rigid nonattainment New

Source Review requirements, includ-

ing installation of the most stringent

control technologies without regard

to cost and an obligation to obtain

GHG emission of‌fsets for any new

carbon dioxide emitted. It is dif‌f‌icult

to comprehend how there could be

meaningful economic growth in

such a regulatory environment.

When I raise these concerns, I

am often dismissed by proponents

of GHG regulation under the CAA

as a “fear-monger.” No one wants

GHG NAAQS, I am told, and so

we will never have them, and EPA

can easily f‌ind ways around the PSD

thresholds so that PSD will apply

only to the largest sources. Yet the

ANPR comments of at least three

environmental organizations took

the position that EPA should es-

tablish GHG NAAQS, with two of

them calling for the establishment of

NAAQS at levels that would make

the entire country a nonattainment

area. Similarly, at least two environ-

mental groups took the position that

the statutory PSD thresholds are

mandatory and must apply to small

sources. I agree. Some of the mecha-

nisms and theories discussed in the

ANPR for avoiding PSD applicabil-

ity to small sources sound more like

wishful thinking to me than serious

regulatory proposals.

In any event, I am greatly con-

cerned that the pressure for im-

mediate GHG regulation under

the CAA has caused proponents to

imprudently discount the cascading

ef‌fects such regulation will have. In

our rush to do something to reduce

GHG emissions, we should avoid a

regulatory policy of “ready, shoot,

aim.”

Peter S. Glaser is a Partner in the Wash-

ington, D.C., ofce of Troutman Sanders LLP.

Yes, But Congress

Might Want a

More Tailored Fit

D K

Previously, we’ve spelled

out specif‌ic steps Presi-

dent Barack Obama can

take to encourage Con-

gress to pass legislation

establishing a strong cap-and-trade

program. Yet there has been specu-

lation as to whether the president

already has the authority, under the

Clean Air Act, to establish a cap-

and-trade program without waiting

for Congress to act.

ere is no straightforward an-

swer to this question. For one thing,

EPA has never successfully imple-

mented a cap-and-trade program for

any pollutant without congressional

approval. e Bush administration

tried twice, once with the Clean Air

Mercury Rule and again with the

Clean Air Interstate Rule, and both

programs were ultimately struck

down by the D.C. Circuit for rea-

sons that should not be dispositive

for a CO2 cap-and-trade program.

e only time cap-and-trade

has been permitted to go forward

is when it was explicitly approved

in CAA provisions, as was the case

with EPA’s famous Acid Rain Pro-

gram. Georgetown Law professor

Lisa Heinzerling noted in testimony

before the House Committee on

Energy and Commerce that this by

itself might be grounds for prohibit-

ing cap-and-trade for CO2 under

other sections of the act, “because

[the acid rain] provisions explicitly

permit emissions trading, it might

be argued that the provisions that do

not mention trading do not allow

it.”

Precedent thus provides little

insight as to whether a full-f‌ledged

cap-and-trade program for CO2

emissions under the existing CAA

would withstand a court challenge.