Mercury Regulation Overturned

A cap-and-trade program for controlling mercury emissions from power plants violates the Clean Air Act, a federal appeals court said on Feb. 8, striking down a regulation favored by electric utilities.

At issue was a key Bush Administration effort under the Clean Air Act to control mercury emitted from coal-burning power plants. The regulation, issued in March 2005, was designed to give electricity generators credits allowing them to emit a specified amount of mercury. Plants that curbed their releases below this amount could then sell excess allowances to facilities that needed more.

To put this cap-and-trade program in place, the Environmental Protection Agency removed utilities from a list of sources whose emissions must be tightly controlled under the Clean Air Act.

Fourteen states, backed by environmental activists, argued that this move by EPA went afoul of the Clean Air Act. According to that law, they said, the agency must require each coal-fired power plant to install equipment to reduce emissions of mercury.

The U.S. Court of Appeals for the District of Columbia Circuit agreed. EPA failed to make a sound legal case for removing coal-fired power plants from the category of air polluters that are stringently regulated, a three-judge panel ruled. Thus, the cap-and-trade regulation is unlawful, the court determined.