The Long and Winding Road: EPA Moves Closer to Regulating Greenhouse Gas Emissions Under the Clean Air Act

In a widely expected move, on Friday, April 17th the Environmental Protection Agency ("EPA") issued a proposed determination that Greenhouse Gases ("GHGs") contribute to air pollution to such an extent that they may endanger public health or welfare.  EPA's "endangerment finding", which initiates a 60-day public comment process, represents a step closer to possible federal regulation of GHGs under the Clean Air Act.  EPA's finding comes two years after the Supreme Court issued its Massachusetts v. EPA decision which opened the door to such a finding, and also comes at a time of marked activity in the States, and especially at the federal level, for a possible legislative approach to management of GHGs and their now acknowledged effect on climate change. 

Under Section 202 of the Clean Air Act, EPA is required to regulate any air pollutant which it determines "cause[s], or contribute[s] to, air pollution which may reasonably be anticipated to endanger public health or welfare."  After years of inactivity by EPA with respect to GHGs (which include carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF6)) numerous organizations petitioned EPA in 1999 to regulate GHG emissions from new motor vehicles under section 202.  EPA denied the rulemaking petition in 2003, issuing a finding that the Clean Air Act did not authorize regulation of GHGs.  EPA's denial was appealed to the Supreme Court by numerous States and organizations, and in its landmark decision in Mass. v. EPA, the Supreme Court overturned EPA's finding, and concluded that carbon dioxide and the other GHGs fit the definition of a "pollutant" under the Act.  Thus, the Court held that if GHGs endangered public health and welfare, then GHGs were subject to regulation under the Clean Air Act.  

The Obama Administration has moved ahead quickly in responding to the Supreme Court's order that the EPA determine whether GHGs endanger human health or welfare.  In a widely expected move, the Obama Administration preliminarily determined on Friday that concentrations of the six most common GHGs in the atmosphere threaten the public health and welfare of current and future generations, and that the emissions of these pollutants from new motor vehicles contribute to the atmospheric concentrations of these key GHGs and hence to the very real threat of global climate change.  The public comment period on the proposed finding will start 60 days after publication in the Federal Register, with two public hearings scheduled to take place on the subject. 

If made final, the endangerment finding could be used by EPA as the basis for proposed regulations later this year, particularly if Congressional efforts to pass comprehensive climate change legislation are delayed or stymied.   While the EPA could regulate a wide range of different entities through its power under the Clean Air Act, it is most likely that any regulatory effort would focus initially on new motor vehicles and major stationary sources such as power plants, cement factories, and other significant emitters of GHGs. 

Against the backdrop of EPA's endangerment finding, the debate continues within the environmental and regulated community as to whether the Clean Air Act is the appropriate tool for regulating GHG emissions.  The Obama Administration has made it clear that its preference is for Congress to pass "energy security legislation that includes a cap on greenhouse gas emissions" to combat climate change, and that it will use this endangerment finding to engage stakeholders and the public as that debate moves forward.  That debate will next take place in the U.S. House of Representatives with four days of climate change-related hearings set for next week - leading to an expected mark-up of climate change legislation recently introduced by Representatives Markey and Waxman.

As this process evolves and legislative and/or regulatory approaches emerge in response to climate change Farella Braun + Martel LLP will continue to follow new developments and will provide continuing updates and analysis.

For more information on EPA's endangerment finding and for information on how to comment on it see: http://www.epa.gov/climatechange/endangerment/

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Farella Braun + Martel advises clients on carbon management strategies, reporting obligations and the treatment of GHG emissions in CEQA documents and is closely monitoring the development of climate change-related statutes and regulations. For more information, please contact Buzz Hines at 415.954.4400.