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Environmental lawyers use a variety of sources to determine how the law is interpreted for a particular legal issue including the statute (in this case the Clean Air Act), the regulations written by the Environmental Protection Agency, and prior cases to see how the courts have ruled on similar issues in the past. The Legal Issue In 1970, the Clean Air Act set strict pollution standards for new pollution sources and more lenient standards for older ones. Under this "grandfather" clause, the old companies could continue to operate without updating pollution controls. The question is: under what conditions can an old pollution source become a new one? For example, if all the parts of an old source are replaced, can the pollution source still be considered old? The particular issue for this case concerns whether the "modification" that Energy One made to its plant causes it to be considered a new source thus making it in violation of the Clean Air Act. The Statute - The Clean Air Act The act defines a modification as any "physical change" to the source that increases the amount of any air pollutant emitted by that source. The Regulations - The Environmental Protection Agency The Environmental Protection Agency (EPA) is the federal agency in charge of administering the Clean Air Act. In these regulations, the EPA has specified that a "modification" does not include "routine maintenance, repair, and replacement." Prior Cases from Lexus Research Chevron v. National Resources Defense Council, 467 U.S. 837 (1984): The National Resources Defense Council sued the EPA for its ruling that stated a company would not be in violation of the Clean Air Act as long as the net pollution for the entire plant remained the same. Thus, the pollution from one source at the plant could increase as long as the pollution emitted from another source at that plant decreased by at least that amount. The National Resource Defense Council argued that each individual pollution source within a plant should be treated separately. Thus, if the emissions at one smokestack within a plant increased, the company would have to pay a fine regardless of how much pollution they reduced elsewhere in the plant. Chevron, which agreed with the EPA ruling, joined the case on the side of the EPA. The U.S. Supreme Court ruled in favor of Chevron and EPA's regulations. This case set a precedent that the U.S. Supreme Court will rule in favor of the EPA (or any other federal agency) as long as the EPA has a "reasonable" interpretation of the law. In future cases, it is up to the courts to determine whether the EPA's interpretation is reasonable or not. Wisconsin Elec. Power Co. v. EPA, 893 F.2d 901 (7th Cir. 1990): The EPA sued WEBCO, the power company, for violating the Clean Air Act. WEBCO replaced deteriorating air heaters and steam drums in five of its units. This extended the life expectancy of the units from 1992 to 2010. WEBCO argued that these replacements did not constitute a "modification" because (1) they were simply replacing component parts with other, identical parts, so there was no net "physical change"; and (2) these replacements were "routine." The EPA argued that these changes were not "routine" because of the nature, extent, purpose, frequency, and cost of the changes. They found the nature and extent of the changes were substantial because the plant had to shut down the unit for 9 months in order to make the replacement. In addition, the EPA could not find another project at an electric company that approached the nature and scope of this change. They found the purpose of the replacement was for life extention and is not a change that needs to be made frequently (typically these types of replacements only need to be made once or twice during the lifetime of the plant). In addition, the cost of these replacements was substantial and totaled $70.5 million. Because the court determined that the EPA's interpretation of the modification was reasonable, it ruled in favor of the EPA. Note: A circuit court decision applies only to the states within that circuit. The states within the 7th Circuit are Illinois, Indiana, and Wisconsin. However, judges in other states will heavily weigh another circuit court's decision when making their ruling. General Power Elec. Co. v. Sierra Club, 915 F.2d 231 (4th Cir. 1994): The Sierra Club sued General Power Electric Company for violating the Clean Air Act. The Seirra Club argued that GPE's pollution emissions increased as a result of its repair of regenerator cyclones and pulverizers. GPE argued that these repairs were routine because they needed to be made frequently and the cost was under $1 million. The Circuit Court ruled in favor of GPE. Note: The states within the 4th Circuit are Maryland, Virginia, West Virginia, North Carolina, and South Carolina. Important Note: The GPE case is fictionalized whereas the Chevron and WEBCO cases are re-written summaries of actual cases.
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