D.C. Circuit Stays New Source MATS Lawsuit

On September 12, 2012 the U.S. Court of Appeals for the D.C. Circuit granted EPA’s motion in White Stallion Energy Center v. EPA to stay the lawsuits challenging the new source MATS while EPA reconsiders the rule. On July 20, 2012, EPA granted partial reconsideration of the new source MATS, including measurement issues related to mercury and the data underlying the PM and HCl emissions standards. The EPA argued that proceeding in the case would “be a waste of the Court’s resources, and could create a risk of regulatory confusion if the [c]ourt were to rule on aspects of the MATS Rule that are actively under reconsideration by EPA.” In its motion, EPA indicated that it will consider the claims made by industry that the new source MATS are too stringent to be achieved in practice, and “may thereby obviate the need for the [c]ourt to adjudicate any challenge to the new source standards.” The petitioners had urged the court to deny EPA’s motion to hold the case in abeyance, arguing that the delay would worsen the regulatory dilemma created by EPA’s proposed GHG NSPS rule. The petitioners argued that a delay of several months while EPA reconsiders the rule would make it “even harder for petitioners to meet the April 2013 construction deadline” that the petitioners must meet to obtain an exemption from the GHG NSPS.

The petitioners had previously won a motion on June 28, 2012 to sever and expedite their challenges to the new source MATS from the consolidated case challenging the rule due to this “regulatory dilemma.” The petitioners alleged that because the new source MATS are too stringent to be met and violate the Clean Air Act, they cannot begin construction on their new coal-fired EGUs; however, if they do not begin construction prior to April 13, 2013, they will face an effective construction ban as a result of the proposed GHG NSPS. The new coal plant developers argued that they would face irreparable harm if their claims are not litigated on an expedited basis. Prior to being stayed, briefing had already begun in the case, with the petitioners opening brief filed on July 27, 2012.