NSR Enforcement Staggers On: A Split Decision in Missouri

Given EPA’s recent run of defeats in its NSR enforcement initiative, it’s probably breathing a sigh of relief over last week’s decision in United States v. Ameren Missouri, regarding Ameren’s Rush Island coal-fired power plant.  Rush IslandTrue, the court denied EPA’s motions for summary judgment.  However, it also denied Ameren’s motions and on balance probably left EPA feeling better than Ameren about its prospects at trial.  Fifteen years ago, this decision would probably have disappointed EPA.  Today, it is probably Ameren that is feeling disappointed.

It’s a long decision, covering a lot of the key issues in NSR cases, so if you’re an “air head”, you’re going to spend some time on this one.  Here are some of the highlights:

  • The Court agreed with EPA that the routine maintenance exclusion should be construed narrowly.
  • The Court did not accept either EPA’s “routine at the facility” approach or Ameren’s “routine in the industry” approach, but on balance seemed to be closer to EPA’s position.
  • Ameren has the burden of proving that the routine maintenance exclusion applies.
  • All of the various elements of Ameren’s projects will be aggregated for purposes of determining what is the “project” under review.
  • The Court adopted EPA’s interpretation of the demand growth exclusion, narrowing the availability of this defense.
  • After the fact, EPA can prove an NSR violation either by demonstrating that actual emissions increased or that Ameren’s projected increases, if properly performed, should have shown an increase subject to NSR.
  • The Court appears to have rejected the 6th Circuit and D. Michigan decisions in the DTE NSR litigation which held that EPA may not “second guess” the facility operators emissions projections.  Going forward, this is the most significant aspect of the decision, and one that EPA is certain to push in related cases.

On balance, EPA has to be feeling pretty good, even if Ameren lives to fight another day.  The possibility that it has found a court to reject the approach in the DTE decisions regarding how to review predictions of future emissions could be very significant.

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