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Real Property & Development Review

EPA to Regulate Greenhouse Gas Emissions

Posted in Environmental

Authored by:  Lauren Giles, Kerry Shea, and Clayton Graham

Findings recently issued by the Environmental Protection Agency (EPA) could be the first step in national regulation of greenhouse gas (GHG) emissions under the Clean Air Act. Although the findings apply only to new motor vehicles and engines for the time being, they lay the groundwork for regulating GHGs emitted by power plants and manufacturing facilities.

Background

In 2007, the U.S. Supreme Court, in Massachusetts v. EPA, 549 U.S. 497, held that greenhouse gases constitute pollutants under the Clean Air Act and ordered the EPA Administrator to determine whether or not such gases cause or contribute to pollution that may endanger human health. In response to this order, the EPA, on December 7th, 2008, issued formal findings that six greenhouse gases (carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and sulfur hexafluoride) present a health and safety issue such that they should be regulated under the Clean Air Act. EPA found that the six listed gases threaten human health (the “endangerment” finding), and that motor vehicle emissions contribute to the concentration of the gases in the atmosphere (the “cause or contribute” finding).

What are the impacts of the findings? Who will be affected?

These findings legally obligate EPA to regulate the gases under section 202(a) of the Clean Air Act, which requires that the Administrator set standards for emissions of pollutants from new motor vehicles and new motor vehicle engines. While the finding does not directly regulate emissions, it does allow the EPA Administrator and the Administrator of the National Highway Traffic Safety Administration to finalize proposed standards for GHG emissions from new cars and light-duty trucks, which were released on September 15, 2009 (see this announcement).  However, these standards will apply only to new motor vehicles and engines–existing vehicles and engines will not be affected.

Stationary Source Regulation

Because Massachusetts v. EPA specifically addressed regulation under section 202(a), the new findings are focused on vehicle emissions only. Down the road, however, it is also possible that the findings could lay the groundwork for regulating these gases under other provisions of the Clean Air Act, such as those applying to emissions from power plants and manufacturing facilities. Having found that GHG emissions from motor vehicles endanger human health, it would be difficult for EPA to assert that emissions of GHGs from other sources did not.

This is one of numerous regulatory and legislative developments that will likely affect emitters of GHGs over the coming year. For example, EPA’s greenhouse gas reporting rule imposes reporting requirements on certain stationary sources, as well as some mobile sources.  Further, some federal courts have interpreted existing causes of action, such as common law nuisance, to assess possible liability for property damage indirectly caused by the emission of greenhouse gases. Finally, Congress is still considering new laws to address greenhouse gas emissions. Thus, owners of facilities that emit GHGs should be aware that the regulatory and legislative landscape in 2010 and beyond is likely to be much more restrictive and should begin preparing for potential restrictions on emissions.