posted on Monday, June 18, 2007 10:15 AM by Gunnar Birgisson

D.C. Circuit Strikes Down Rule Favorable to Waste-to-Energy Facilities

Dealing a blow to the waste-to-energy industry, a U.S. Appeals Court recently vacated a rule promulgated in 2004 by the Environmental Protection Agency (EPA) that implemented limits on emissions of hazardous air pollutants (HAP) from certain commercial and industrial boilers (the CISWI Rule). 

In 2005, a number of environmental organizations challenged the rule.  At particular issue was EPA's regulatory definition of "commercial and or industrial waste."  In short, EPA's definition limited solid waste incinerators, as a class, to those facilities (1) that operated without energy recovery or (2) whose design did not provide for energy recovery.  This interpretation effectively exempted waste-to-energy facilities from the HAP limitations contained within Section 129 of the Clean Air Act and allowed waste-to-energy facilities to be regulated by Section 112 of the Clean Air Act.  This distinction is significant because, among other things, the standards in Section 112 only apply to "major" sources of HAP emissions whereas Section 129 applies to all sources of HAP emissions. 

In rejecting the definition and vacating the rule, the court found that EPA's definition impermissibly "reduce[d] the number of commercial or industrial waste combustors subject to Section 129's standards by exempting from coverage any commercial or industrial incinerator combusting 'solid waste' if the combustion unit's design permits thermal recovery…."  Natural Resources Defense Council, et al. v. United States Environmental Protection Agency, No. 04-1385, slip op. at 14 (D.C. Cir. June 8, 2007).  Applying the traditional Chevron standard of review to EPA's regulatory definition, the court found that (1) Section 129 was intended unambiguously to cover any incineration facility that combusts any commercial or industrial solid waste and that (2) EPA's definition wrongly cabined the scope of this plain, broad language.  Barring an unlikely appeal, EPA will now need to craft a new definition that brings waste-to-energy facilities within the reach of Section 129.  The result will likely be regulatory uncertainty in the short term and more investment in HAP control technologies in the longer term