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Court Blocks Bush Administration From Applying Weakened New Source Review Rules

A federal court on December 24, 2005 dealt a major blow to the Bush administration's plan to gut a key provision of the Clean Air Act. The U.S. Court of Appeals granted a coalition of environmental groups' motion to stay implementation of a loophole in the law's new source review program that would allow thousands of aging power plants and other industrial facilities to emit more air pollution, threatening the health of millions of Americans. The court will not lift the stay unless it ultimately decides the administration's rule change is legal.

To obtain a stay, the environmental groups had to demonstrate that they were likely to prevail in their legal challenge to the rule. In addition, they had to show that their members would suffer irreparable harm if the court allowed the rules to go into effect. The court rarely grants requests to stay regulations pending judicial review.

If the court had not issued a stay, the new rules would have gone into effect on December 26 in at least 17 states and territories, including California, Illinois, Massachusetts, Michigan, Minnesota, New Jersey, New York, Nevada and Pennsylvania. Industrial facilities in those states would have been able to take advantage of the new air pollution loophole immediately.

The new source review program was designed to curb air pollution from industrial facilities by requiring them to install up-to-date pollution controls whenever they made physical or operational changes that increased air pollution. Many of the nation's older power plants have operated long beyond their expected lifespan, polluting at excessively high levels, largely because utilities have rebuilt these grandfathered plants over time. Often they modified these facilities in ways that increased air pollution without complying with Clean Air Act requirements to install modern emissions controls. The Environmental Protection Agency launched enforcement lawsuits against utility and refinery violators during the latter part of the Clinton administration for pollution increases that had resulted in millions of tons of air pollution.

The Bush administration tried to derail these enforcement suits and eliminate future actions by changing the rules to allow companies to virtually rebuild their facilities and boost pollution levels without having to meet new source review program requirements. The loophole created by the EPA rule would allow more than 20,000 power plants, refineries and other industrial facilities to replace existing equipment with "functionally equivalent" equipment without undergoing the clean air reviews required by the new source review program if the cost of the replacement does not exceed 20 percent of that of the entire "process unit." This exemption would apply even if a facility's air pollution increased by thousands or tens of thousands of tons as a result of the replacement.