Environmental -- 2005



United States v. Duke Energy Corp.   (4th Circuit)

Permits for power plant repairs

This case is about whether permits are required when power plant repairs are made to allow boilers to continue in service and operate for more hours than before the renovations. The EPA argued that these repairs were modifications that allowed the boilers to produce more emissions (albeit at the same rate per hour) than authorized by existing permits. Duke Energy argued that the definition of a modification that would necessitate a new permit includes only changes that increase the hourly emission rate, since that is the definition the EPA uses under its New Source Performance Standards (NSPS). The Fourth Circuit ruled 6/15/05 that the EPA cannot interpret the word “modification” two different ways when the statutes in which the word appears define it identically. Consequently, since the definition of modification under the NSPS only applies to changes that increase the hourly emission rate, no permit is required.

This is a significant victory for any business that generates emissions regulated by the Clean Air Act. American industry would grind to a halt if it were required to scrutinize for potential permits thousands of renovation activities each year. For instance, if the activity is a necessary repair or replacement project, the result could be an extended shutdown of the facility until it could be undertaken.

The NAM and other business organizations filed a brief 10/15/04 supporting this result. The joint brief argued that New Source Review permit requirements are only triggered when facilities are physically changed or modified to create an increase in emissions over the level approved in the original permit process.

This case on appeal to the Supreme Court is Environmental Defense v. Duke Energy Corp.