Another Setback for the Ethanol Industry - Court Overturns Government’s Pollution Rule

August 20, 2008 | Roger McEowen

Earlier this year, the Environmental Protection Agency (EPA), pursuant to the Clean Air Act (CAA), announced it was adopting regulations designed to reduce the amount of ozone (smog) allowed in the air.  Just before the announcement, however, EPA agreed to weaken a key section of the new rules after being told at the last minute that President Bush preferred a less stringent approach.  We wrote about the issue here, and noted that the President’s move was designed to soften the EPA’s smog rules to protect the ethanol industry.  Now, the U.S. Circuit Court of Appeals for the D.C. Circuit has struck down an EPA rule which blocked state and local authorities from ramping up monitoring requirements for industrial polluters, such as ethanol plants.  The court ruled that the government violated the CAA by allowing ethanol plants and other industrial polluters to circumvent the monitoring and recording requirements of the 1990 amendments to the CAA.  Those amendments require stationary pollution sources to obtain permits from state and local authorities, which set emission limits and monitoring requirements.  When emission standards have inadequate monitoring requirements – for example, a daily emissions limit that requires only annual monitoring – permitting authorities had taken to supplementing the monitoring requirement “to assure compliance with the permit terms and conditions.”  But, the EPA issued a rule in 2006 to stop state and local authorities from patching the monitoring requirements.  Environmentalists challenged the EPA rule, claiming it violated the intent of the 1990 amendments, and the court agreed.  Sierra Club, et al. v. Environmental Protection Agency, et al., No. 04-1243 (D.C. Cir. Aug. 19, 2008).