Business, Trade Groups Unite to Oppose Court Order Spiking Power Plant

Carbon dioxide emissions from coal-fired plants are at the crux of the debate
More than 100 businesses, trade groups, chambers of commerce and elected officials are asking Georgia's Court of Appeals to look at a ruling that scuttled the permit for a power plant because it didn't limit the plant's carbon dioxide emissions. The decision received nationwide attention, as it's said to be the first U.S. court ruling that says CO2 emissions must be considered when building a power plant. The decision could influence the permits for all coal-fired power plants, not just those in Georgia.

Alyson M. Palmer

Daily Report

2008-08-04 12:00:00 AM

More than 100 businesses, trade groups, local chambers of commerce and elected officials have joined the Georgia Chamber of Commerce in asking the state Court of Appeals to look at a Fulton County judge's recent ruling that scuttles the permit for a proposed South Georgia power plant.

The Georgia Chamber files amicus curiae briefs in court cases from time to time, last year filing in defense of a fee-shifting rule that was part of the 2005 tort reform legislation. But it's unusual to see the organization announcing its amicus brief in a press release and previewing it with an op-ed piece in the Atlanta Journal-Constitution, as it did July 16 in the power plant case.

"I don't know of anything that has happened that has gotten our members ... more concerned," explained George Israel, Georgia Chamber president and CEO.

Superior Court Judge Thelma Wyatt Cummings Moore effectively stopped Houston-based Dynegy Energy from building a coal-fired plant in Early County in a June 30 order, ruling that an administrative law judge should not have approved the plant's permit because it didn't limit the plant's carbon dioxide emissions.

The decision received nationwide attention, as it's said to be the first U.S. court ruling that says CO2 emissions must be considered when building a power plant. The Sierra Club trumpeted the decision's potential to influence permitting for all coal-fired power plants, not just those in Georgia.

Moore's decision turned on her interpretation of a 2007 U.S. Supreme Court decision that says the Environmental Protection Agency has the authority to regulate CO2.

The Early County plant, which would produce power that could be sold outside Georgia, would be developed by Longleaf Energy Associates, a subsidiary of a New Jersey company that was acquired in 2007 by Dynegy Energy, according to a court filing by environmental groups that challenge the permit.

While the Chamber is represented in the matter by Vidalia, Ga., lawyer Hugh B. McNatt and attorneys at Troutman Sanders, a bevy of high-powered attorneys, including former state Attorney General Michael J. Bowers and former state Supreme Court Chief Justice Norman S. Fletcher, have signed the amicus brief.

The amicus brief filed Wednesday says that Moore's ruling would result in an "effective moratorium" on new construction, subjecting even hospitals and small farms to environmental permitting requirements. The Chamber says its main beef with Moore's ruling is that it requires the state to regulate CO2 emissions based on her view that federal regulators consider it a pollutant. But the Chamber says the EPA has not decided to regulate CO2, and is only now seeking input on whether it should do so.

A lawyer for Friends of the Chattahoochee and the Sierra Club, which challenged the permit, said the business groups overstate the ruling's potential to create regulation of businesses outside the power sector. The lawyer, George E. Hays of San Francisco, called it "disingenuous" to raise questions about permitting for schoolhouses when environmental groups are fighting over a large power plant.

The plant on the banks of the Chattahoochee River would be the first coal-fired plant to be built in Georgia in more than 20 years. Israel said it also would be the cleanest coal-fired plant ever built in the state and pointed to the 100 or more jobs it would bring to Early County, which he said is one of the poorest in the state. Environmental groups have said the plant would emit as much as 9 million tons of CO2 annually, a figure equivalent to the emissions of 1.4 million to 1.6 million cars traveling 12,000 miles a year.

Administrative Law Judge Stephanie M. Howells gave her approval for the plant in January in a 108-page decision that followed a 21-day hearing. The environmental groups took the matter to Moore, convincing her to reverse.

Moore said in her order that the Longleaf power plant must incorporate what is called a "best available control technology," or BACT, emissions limit for any pollutant subject to regulation under the federal Clean Air Act. That's because it falls under the "major emitting facility" definition of the federal statute.

Moore found several problems with Howells' analysis of the permit, but the business amici are focusing on Moore's analysis of the CO2 issue. She said the permit was invalid because it included no CO2 emission limit based on a BACT analysis.

In her order, Moore wrote that the U.S. Supreme Court said in Massachusetts v. EPA 127 S.Ct. 1438 (2007) that CO2 is an air pollutant under the Clean Air Act. She also said the notion that CO2 is subject to regulation under the federal statute is further underscored by federal regulations that require monitoring of CO2 emissions.

Both Longleaf's lawyers at King & Spalding and state Attorney General Thurbert E. Baker, who represents state Environmental Protection Division Director Carol Couch, have filed applications asking the Court of Appeals to take up the ruling. They attack Moore's ruling on a host of points, not just the CO2 issue.

"This is as difficult and as complicated technically and legally as anything in environmental law," said Patricia T. Barmeyer, head of King & Spalding's environmental practice. "The superior court judge just with only a limited amount of information and a limited understanding reversed all the hard work by the ALJ and all the determinations of the agency."

On the CO2 issue, the defenders of the permit say that the Massachusetts v. EPA Supreme Court ruling said that the EPA had the statutory authority to regulate CO2 but left it to the EPA to decide whether and how to regulate. Last month the EPA issued a notice soliciting comment regarding regulation of greenhouse gases.

The permit's defenders say that even facilities that never have been regulated under the Clean Air Act before, such as office buildings, could fall under the definition of a "major emitting facility" -- and thus be subject to permitting requirements -- if CO2 is considered an air pollutant under the statute. "CO2 is so ubiquitous," said Barmeyer, "and everything emits CO2 in large quantities."

The Georgia Chamber and Longleaf's lawyers argue that schools and hospitals could be subject to permitting regulations under Moore's ruling, as well. The Clean Air Act says states can exempt nonprofit schools and hospitals from the definition of "major emitting facility," but Barmeyer explained that Georgia has not done so yet.

Israel said it's "a given" that some regulation of CO2 is coming -- "when they get a handle on the science" -- and explained that industries that use coal are doing their research. But, he said, CO2 cannot be scrubbed out of the air and instead must be captured and compressed at significant cost. He said the geology of the Southeast allows for potential sequestration sites only in southwest Alabama and Mississippi.

The technology and science are "just not there" to justify Moore's ruling, Israel said. "We feel very strongly that the judge attempted to legislate or make policy from the bench."

But Hays, the San Francisco lawyer who has worked with GreenLaw on the case, said that a BACT emissions limit is supposed to be based only on the technology that's available at the time.

"So in some sense I don't understand why everybody is getting so hysterical about this," he said. "It's not like facilities would be stopped in their tracks from constructing here. ... They just have to control it to the best of our ability right now. Over time, the controls get better and better and better."

Possible improvements for the Longleaf plant could involve better thermal efficiency or a requirement that it burn some percentage of renewable fuel, according to Hays. He acknowledged that office buildings might be subject to permitting but said that might be "a very perfunctory exercise."

"In trying to deal with a source that's going to emit millions of tons of CO2, the focus is on that," said Hays. "We're not trying to get down to the level of a schoolhouse right now and address that problem, so I think we need to keep our eye on the ball here."

The Court of Appeals has until Aug. 29 to decide whether to hear the case.

The cases are Longleaf Energy Associates v. Friends of the Chattahoochee, No. A08D0472, and Couch v. Friends of the Chattahoochee, No. A08D0473.