D.C. Circuit EPA decision has implications for natural gas

A three-judge panel for the U.S. Circuit Court of Appeals for the District of Columbia Circuit has thrown out the Environmental Protection Agency’s (EPA) so-called Summit Directive.

The Summit Directive stated that EPA could no longer consider interrelatedness in determining “adjacency” when making source determination decisions in its Title V or New Source Review permitting decisions in areas under the jurisdiction of the Sixth U.S. Circuit Court of Appeals.

The National Environmental Development Association’s Clean Air Project, which is a multi-sector coalition of manufacturing and resource extraction companies subject to Clean Air Act permits, said the Summit Directive put companies operating outside the Sixth Circuit’s jurisdiction at a competitive disadvantage.

The D.C. Circuit agreed with the petitioners and ruled in their favor. “On the merits, we hold that the Summit Directive is plainly contrary to EPA’s own regulations, which require EPA to maintain national uniformity” and to identify and fix any regional inconsistencies.

“This case is very important for oil and gas,” Bracewell & Giuliani partner Jeff Holmstead told GenerationHub.

“The Court said that EPA cannot claim that an oil and gas field is a single “source” of pollution and should therefore be permitted as a major source. The Court says that different emissions points may only be aggregated and treated as single source if they are physical adjacent to each other,” Holmstead said when asked about the case.

“This will help oil and gas operations quite a bit, and may therefore make it less expensive to produce natural gas. Since the power sector is increasing reliant on natural gas, it will benefit from having lower cost natural gas,” Holmstead added.

The decision in National Environmental Development Association’s Clean Air Project versus EPA No. 13-1035 was issued May 30. It had been argued Jan. 17.

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Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 22 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants.

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