When Janet Reno and former EPA chief Carol Browner began suing coal-burning power companies in the final months of the Clinton administration, they sparked a legal battle that still rages today in the federal courts.
The most recent skirmish was decided in the U.S. Supreme Court in April when the court unanimously rejected a 4th Circuit ruling in Environmental Defense v. Duke Energy. The decision was a setback for Duke and other power companies that hoped the court would affirm the 4th Circuit's decision to invalidate the EPA's net-annual emissions test, used to determine whether a physical change to an existing power plant subjects that plant to the Clean Air Act's (CAA) standards for new sources of pollution.
EPA sued Duke in December 2000, alleging 58 ongoing violations of PSD permit requirements, and argued the company must stop operating the affected plants until it installs the latest pollution-control technology--at a cost likely to force many of the 1950s-vintage plants into retirement. Additionally, EPA said Duke is liable for hundreds of millions of dollars in possible penalties.
"The case illuminates the problem EPA's new-source review program presents," says Lewis Putman, a partner at Milbank, Tweed, Hadley & McCloy. "It's a complicated, confusing, very difficult program for utilities to deal with."