The U.S. Court of Appeals for the Sixth Circuit, citing Richard Revesz’s work with co-author Jonathan Nash on “grandfathering” power plants, recently reversed a district court order and sided with the EPA in its case against DTE Energy Corp. The court ruled that the Clean Air Act grants the EPA the power to review projections of future emissions resulting from a facility modification without having to wait for data from the completed project.
Although the court ruled in the EPA’s favor, it took issue with the agency’s argument that New Source Review is a program designed to force every source to eventually adopt modern emissions control technology. Judges John Rogers and Martha Craig Daughtrey cited Revesz’s Northwestern University Law Journal article on grandfathering in the majority opinion, stating that current regulations actually allow plants to “replace parts indefinitely without losing their grandfathered status so long as none of those changes cause an emissions increase.”
The case and the court’s decision bring to light the contradictory nature of the EPA’s new source regulations and the ways in which they can distort the economic considerations that companies face when deciding whether to construct new plants or invest in cleaner technologies.