The D.C. Circuit has upheld a 2012 EPA rule limiting air toxics emissions from coal- and oil-fired power plants. The rule, commonly known as the Mercury and Air Toxics Standards, or “MATS,” requires new and existing coal- and oil-fired power plants to reduce emissions of mercury, arsenic, chromium, and other toxic air pollutants.
In a 2-1 decision, the D.C. Circuit rejected a variety of challenges from industry and environmental groups, including a challenge to EPA’s conclusion that it was not required to consider costs in determining whether regulation of electric utilities is “appropriate and necessary” under Clean Air Act § 112(n)(1)(A). While acknowledging that cost of compliance plays an explicit role in setting “beyond-the-floor” MACT standards and indirectly influences the determination of MACT floors, the majority deferred to the EPA’s determination that it is reasonable to make the initial decision to list the utilities as sources of hazardous air pollutants without taking cost into consideration.
In his dissenting opinion, Judge Kavanaugh argued that the term “appropriate” necessarily implied that costs should be taken into account in making the listing decision, citing EPA’s own regulatory impact analysis, which estimated the cost of implementing the rule at $9.6 billion.
The lead case is White Stallion Energy Center, LLC v. U.S. Environmental Protection Agency, D.C. Circuit Case No. 12-1100.