MATS Litigation Rolls On

Original article by Katherine L. Vaccaro of Manko Gold Katcher & Fox

In 2017, the District of Columbia Circuit Court of Appeals will hear the latest round of challenges to EPA's Mercury and Air Toxics Standards ("MATS"), a regulation that has attracted considerable attention for being one of the most expensive air pollution control regulations in history. MATS, which regulates emissions of hazardous air pollutants ("HAPs") from electric generating units used at power plants ("EGUs"), was initially challenged in 2012 by a host of industry representatives and environmental groups. The DC Circuit determined that regulation of EGUs by the U.S. Environmental Protection Agency ("EPA") under MATS was reasonable and upheld the rule. Opponents of MATS next appealed to the U.S. Supreme Court, which reached the opposite conclusion that EPA had acted unreasonably by failing to consider the costs of compliance in determining that it is appropriate and necessary to regulate HAPs from EGUs. The Supreme Court therefore directed EPA to fulfill its obligation to consider costs in justifying the regulation, but the Court did not vacate MATS during the interim. Michigan v. EPA, 135 S. Ct. 2699 (2015). In response to the Supreme Court's decision, EPA issued its "Supplemental Finding" in April 2016, in which EPA affirmed its earlier determination of the appropriateness of the rule. The Supplemental Finding is now the subject of new challenges before the DC Circuit. Final briefs in this case are due in late March 2017, and the Court is expected to hear oral argument shortly thereafter.
Because MATS remained in effect while EPA undertook to respond to the Supreme Court's directive, certain of the rule's key compliance deadlines have already passed. Therefore, a majority of the sources subject to MATS have had to take action to transition toward compliance, including by making material operational changes and installing significant control system upgrades to satisfy MATS's stringent emission standards. Accordingly, for most sources, it may not matter if MATS is ultimately invalidated. Yet, other facilities continue to seek relief from MATS. The DC Circuit's forthcoming ruling will bring us one step closer to determining MATS's ultimate fate.