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GHG Regulation under PSD and Title V

On December 23, 2010, the Environmental Protection Agency (“EPA”) released six more rules designed to make sure that all areas of the country are, or will be, covered by a Clean Air Act program that includes permitting requirements for greenhouse gas (“GHG”) emissions in accordance with EPA’s Tailoring Rule.

On December 10, 2010, the United States Court of Appeals for the D.C. Circuit (“the Court”) denied motions by a broad swath of industry and several states to stay EPA’s greenhouse gas (“GHG”) regulatory program.  The motions asked the Court to stay the appeals pending the Court’s disposition of the numerous appeals of these regulations on the merits. 

On November 10, 2010, EPA issued its long-awaited Best Available Control Technology (“BACT”) guidance for the new greenhouse gas (“GHG”) permitting requirements scheduled to take effect on January 2, 2011, less than two months from now.  The information applies to two permitting programs— the “PSD” program, under which new and modified sources having the potential to emit air pollutants above a certain amount must obtain a preconstruction air quality permit, and the Title V program, under which sources having the potential to emit air pollutants above a certain amount must obtain an operating permit.　

On November 1, 2010, Exelon Corporation (“Exelon”), American Electric Power (“AEP”), and Electric Transmission American (“ETA”) announced the companies will partner to build a new transmission line dubbed the Reliability Interregional Transmission Extension (“RITE Line”).  The new project will construct 420 miles of extra high-voltage lines from Illinois to the border between Indiana and Ohio. 

On October 12, 2010, Google, Trans-Elect Development Company, LLC (“Trans-Elect”), Good Energies, and Marubeni Corporation (“Marubeni”) announced that the four entities are partnering to create the Atlantic Wind Connection project.  The Atlantic Wind Connection project will create an underwater transmission “backbone” to connect more than 6,000 MW of offshore wind through more than 350 miles of high voltage direct current (“HVDC”) lines. 

After over a decade of litigation, EPA’s original NSR enforcement attack on Cinergy for various projects completed in the late 1980’s and early 1990’s is finally over.  On October 12, 2010, the U.S. Court of Appeals for the Seventh Circuit threw out EPA’s only  victory in that original action – a jury verdict finding Cinergy in violation of the Clean Air Act’s preconstruction permit requirements for several pulverizer projects performed at its Wabash plant in Indiana.  While the decision represents a significant win for Cinergy and other utilities facing similar claims, it could have a ripple effect for other Clean Air Act programs, including EPA’s new greenhouse gas regulations.

On December 22, 2009, the California ballot initiative, Proposition 23 (“Prop 23”) was introduced by Thomas W. Hiltachk.  Prop 23 would suspend California’s Global Warming Solution Act of 2006 (“AB 32”), which requires the state to reduce greenhouse gas emissions 30 percent by 2020, until California’s unemployment rate is 5.5 percent or less for a calendar year. (see October 1, 2010 edition of the WER).