JURIST Guest Columnist Janet McCabe, Professor of Practice at the Indiana University McKinney School of Law, discusses the EPA’s proposed revision of MATS and its consequences…
Mercury is one of the most toxic substances on earth. When inhaled or ingested by humans, mercury can cause severe neurological damage, cardiovascular harm, endocrine disruption, kidney damage and muscle coordination issues. When pregnant women are exposed, their babies can suffer IQ and motor skills impairments that will last their lifetime.
Through rain, snow or dry deposition, mercury can deposit either directly into waterbodies or indirectly into waterbodies via groundwater seepage through plants and soil. Mercury is emitted by sources around the world; some of it travels long distances around the globe, while other sources deposit relatively close to where it has been emitted. Once in water, mercury chemically transforms into methylmercury, which is readily taken up first by plant and then by animal life and moves up the food chain to ultimately be consumed by people. People are primarily exposed to mercury through the consumption of freshwater or marine fish, either self-caught or, more commonly, purchased at the grocery store or a restaurant.
There have been mercury poisoning events of devastating proportion, including in Minamata, Japan where in 1956 a chemical plant released massive amounts of wastes containing mercury into Minamata Bay, ultimately killing 900 people and injuring more than two thousand. Later, in 1971, seed grain treated with a methylmercury fungicide was mistakenly consumed by people in rural Iraq. Hundreds, perhaps thousands, of people died or were seriously sickened as a result. These were extreme events, but they highlight the point that a very small amount of mercury can cause significant contamination. According to the Minnesota Pollution Control Agency, “approximately one gram of mercury enters a 20-acre lake each year. Over time, just this small amount can contaminate the fish in that lake, making them unfit to eat on a regular basis.”
Anthropogenic sources of mercury include fossil-fuel burning, gold mining, municipal and medical waste incinerators, as well as cement and brick production. Until three years ago, when the EPA’s Mercury and Air Toxics Standards (MATS) for power plants went into full compliance, the burning of coal and oil in power plants had been the most significant source of industrial mercury emissions in the United States because other US industrial sectors had already been subject to Clean Air Act rules that limited their emissions. MATS put in place similar reduction requirements for power plants. In December 2018, however, the EPA issued a proposal that could prove to be a first step in unraveling MATS.
MATS has deep regulatory roots, and the rule signed in 2011 was the result of significant development over time. In 1970, Congress passed the Clean Air Act, the aim of which was to protect Americans’ health and our environment from the adverse impacts of air pollution. Congress directed the EPA to identify pollutants that posed the most risk and to develop regulations to reduce that risk. The original risk- and exposure-based approach proved extremely difficult for the EPA to implement. In 1990, Congress changed the approach to one that required the EPA to set technology-based standards for the most significant sources of air toxics, based on what the best performers in the industry were achieving. With tight standards for sources and follow-up risk and technology reviews, the program would assure continued reductions of air toxics emissions. Because coal-fired power plants were already regulated through other Clean Air Act programs, such as the Acid Rain program, Congress gave the EPA the extra step of evaluating whether existing programs were sufficient to reduce mercury emissions or whether, in the parlance of the Act, it was still “appropriate and necessary” to develop an air toxics rule for these sources.
The path of mercury regulation at the EPA was a long and winding one. After making a positive Appropriate and Necessary (A&N) Finding in 2000, the EPA reversed that Finding in 2005, took coal-fired power plants off the list of sources to be regulated for mercury, and issued the Clean Air Mercury Rule (CAMR), which switched to a cap and trade program. In 2008, the DC Circuit Court of Appeals overturned CAMR, so when the Obama Administration arrived in 2009, moving this issue forward was one of EPA Administrator Jackson’s highest priorities. Without CAMR, coal-fired power plants were the cheese standing alone, responsible for nearly half of US mercury emissions.
In 2011, Administrator Jackson signed the Mercury and Air Toxics Standards. The rule itself was accompanied by a new A&N Finding and an analysis of the costs and benefits of the rule. Using the best information available at that time, the EPA projected that the rule would cost industry $9.8 billion annually, and generate $37-90 billion in benefits through improved public health. These are big numbers, but the control technologies the EPA expected utilities would use to control mercury —particularly scrubbers — would also reduce other harmful air pollutants, including fine particles, sulfur dioxide and nitrogen oxides. The health effects of these pollutants are well-studied and costly; reducing these pollutants has been demonstrated to save lives.
As with all modern EPA rules, the next stop was the courthouse. In the first level of review, the DC Circuit Court of Appeals fully upheld MATS. The US Supreme Court agreed, with one exception: it held that the EPA should have considered cost as part of the A&N Finding, and it directed the EPA to do so, leaving the rule in place in the meantime. The Court stated that the law did not require the EPA to conduct a “formal cost-benefit analysis in which each advantage and disadvantage is assigned a monetary value. It will be up to the Agency to decide (as always, within the limits of reasonable interpretation) how to account for cost.” The EPA moved quickly to propose and finalize a Supplemental A&N Finding, again concluding that MATS was appropriate and necessary, using several approaches to evaluate the costs and the impact those costs would have on the utility industry and consumers.
In the meantime, the industry went about the business of complying with the rule.
Plants had three, four, or in a very few cases five years to come into compliance. In a letter to the EPA on July 10, 2018, the Edison Electric Institute, the American Public Power Association, the National Rural Electric Cooperative Association, the International Brotherhood of Electrical Workers and several other organizations, advised that “all covered plants have implemented the regulation and that pollution controls—where needed—are installed and operating.”
Reconsidering MATS was high on the incoming Trump Administration’s to do list. Stakeholders were anticipating a proposal long before it arrived on December 28, 2018, and groups made their views known through meetings with Administration officials, letters, and other forms of advocacy. Notably, the electric utility industry reported to the EPA that it had spent $18 billion to comply with MATS, facilities were in compliance, and asked that the EPA “allow the industry to continue full implementation of MATS.”
So, after all the speculation, what has the EPA proposed and, if utilities are already in compliance, why does it matter? The proposal takes the A&N Finding head-on. The EPA has looked yet again at the information it considered in 2011 and then again in 2015, and now proposes to rescind the A&N Finding solely because, it asserts, the costs outweigh the benefits. The proposal does not propose to rescind the standards themselves, though it invites comment on that option. The proposal also takes on the Residual Risk and Technology review required under §112(f)(2), proposing to find that “residual risks due to emissions of air toxics from this source category are acceptable and that the current standards provide an ample margin of safety to protect public health” and that “[n]o new developments in… emissions reductions were identified under the technology review,” thus concluding that no revisions to MATS are warranted.
There are several aspects of the proposal worth noting.
First, the EPA based its analysis on costs projected in the 2011 original rule, disregarding up-to-date information on how much utilities have actually spent. Moreover, although the latest science supports “the conclusion that the mercury-related benefits from MATS are orders of magnitude larger” than previously estimated in the MATS Regulatory Impact Analysis, the proposal relies on the 8-year-old Regulatory Impact Analysis for its benefits calculations. Thus, the EPA’s consideration of both costs and benefits in this proposal is out of date, inaccurate, and artificial.
Second, the EPA proposes to reverse itself on the strength of a single highly significant policy change: the agency now proposes to find that it is inappropriate to consider benefits associated with any pollution reductions other than mercury and other air toxics specifically targeted by MATS. This is really the crux of the proposal. The EPA proposes that the only correct way to follow the Court’s direction in Michigan is to “directly compare the cost of compliance with MATS with the benefits specifically associated with reducing emissions of HAP as the primary inquiry in this Finding, in order to satisfy our duty to consider cost in the context of CAA section 112(n)(1)(A).”
But this argument ignores the Court’s statement in Michigan that the consideration of cost is but one of multiple relevant factors, and it assumes that the value of health benefits associated with pollution other than the air toxics included in the analysis are not meaningful within the legal construct of the Clean Air Act. Furthermore, it ignores Guidance from the Office of Management and Budget that agencies are to consider both direct and indirect benefits of rules. It also ignores cause-and-effect realities. If you quit smoking to reduce your chances of getting lung cancer, you will also necessarily reduce your risk (and the risk of others around you) of other significant health impacts. Is it really good policy to discount or even ignore those kinds of facts when considering how the costs of quitting smoking measure up to the benefits?
Third, the EPA has injected uncertainty into a regulatory landscape where certainty is prized by regulated industry. In this case, the regulated industry has already complied and is seeking to recover its costs through rate cases. If the EPA reverses the A&N Finding, it will kick the legal legs out from under the standards themselves, leaving them vulnerable to an administrative petition or lawsuit by a third-party seeking rescission or vacatur of the entire rule. If the requirements go away, utilities may not be able to recover the costs they have already expended, and may operate controls less, if at all, to save operating costs.
There is much more to say, and people will say it all during the public comment period, which will start once the proposal is published in the Federal Register. In the meantime, mercury emissions from US coal plants have gone down 85% between 2006 and 2016, and mercury levels in water and fish have also decreased. That sounds like a successful program to me.
Janet McCabe was Acting Assistant Administrator for USEPA’s Office of Air and Radiation from 2009-2017 and was closely involved in the development of MATS. She is currently Director for Policy and Implementation at the Indiana University Environmental Resilience Institute and a Professor of Practice at the IU McKinney School of Law. She is also a Senior Law Fellow at the Environmental Law and Policy Center.
Suggested Citation: Janet McCabe, EPA Takes a Toxic Turn by Backing Away from Mercury Regulation, JURIST – Academic Commentary, February 3, 2019, http://www.jurist.org/commentary/2019/02/janet-mccabe-epa-mats-revision/
This article was prepared for publication by Stephanie Sundier, a JURIST Staff Editor. Please direct any questions or comments to her at firstname.lastname@example.org
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