Revised MATS rule coming; states ask Supreme Court to intervene

The Environmental Protection Agency on March 22 sent a revised justification for its Mercury and Air Toxic Standards — or MATS — rule to the federal Office of Management and Budget for its review and plans to release the final rule to the public by mid-April.

Meanwhile, Michigan and 19 other states have asked the Supreme Court to force the EPA to start from scratch on a new mercury rule, given the high court's ruling last June saying that the agency should have considered the issue of cost when it first decided to regulate power plants under what later became the MATS rule. The rule is designed to curb emissions of mercury and other hazardous pollutants from power plants.

In a 5-4 decision last summer, the Supreme Court said that when the EPA determined that it was "appropriate and necessary" under the Clean Air Act for it to regulate mercury and other air toxics, the agency should have given at least some consideration to the costs that such a rule would impose.

Last November, the EPA proposed a new justification that found that the expected benefits were large enough to warrant the costs of the rule. The agency predicts that the rule will cost $9.6 billion annually, but yield between $37 billion and $90 billion a year in benefits when fully implemented.

The high court's 2015 decision overturned a 2014 ruling by the U.S. Court of Appeals for the District of Columbia Circuit that upheld the EPA's MATS rule, and remanded the case back to the lower court. In December 2015, the D.C. Circuit Court of Appeals specifically directed the EPA to consider cost as part of the rule's "appropriate and necessary" finding, in keeping with the Supreme Court's June 2015 ruling.

The EPA has said it "will issue a final supplemental finding that details how the agency explicitly considered cost and that such consideration of cost does not alter the EPA's previous determination that it is appropriate to regulate hazardous air pollutant emissions from coal- and oil-fired electric utility steam generating units."

The Utility Air Regulatory Group, the National Mining Association, and more than 20 states had appealed the D.C. Circuit's 2014 decision, arguing that the EPA should have considered the costs that its rule would cause, including the costs that power plants would incur in order to comply with the rule. The American Public Power Association is a member of UARG.

20 states argue that MATS rule is illegal

On March 18, a 20-state coalition led by Michigan asked the Supreme Court to throw out the MATS rule, saying that the EPA still had not considered costs and arguing that the lower court's decision to keep the rule in place while the agency was revising it was illegal.

In its petition to the Supreme Court, the coalition said that the EPA "refused to retract and the D.C. Circuit refused to vacate EPA's regulation, even after this Court held that EPA had overstepped its authority."

In June 2015, "this Court held that EPA must consider costs before it can regulate, yet EPA continues to regulate even though it still has not considered costs," said the 20 states.

Early this year, the same coalition had asked the Supreme Court to issue a stay of the MATS rule. Chief Justice John Roberts rejected that request on March 3.