Jump to Navigation
Jump to Content

Alliance for Clean Coal v. Bayh

ELR Citation: 26 ELR 20557
Nos. No. 95-2065, 72 F.3d 556/41 ERC 2083/(7th Cir., 12/22/1995) aff'd

The court holds that provisions of Indiana's Environmental Compliance Plans Act (ECPA) that favor a utility's use of Indiana coal violate the Commerce Clause of the U.S. Constitution. The ECPA allows a utility to seek an early review by the Indiana Utility Regulatory Commission (IURC) of the utility's plan for complying with the Clean Air Act Amendments of 1990. Following the review, a utility may include the capital costs of facilities in its consumer rate base and recover the costs of development and implementation of its compliance plan. The challenged provisions require a utility that proposes a change in fuel type that would lead to a diminished use of Indiana coal to submit to the IURC an analysis of the effects of the fuel change on Indiana coal mining. Also, the provisions require the IURC, before it approves a plan, to find that the plan provides for continued or increased use of Indiana coal or that economic considerations justify the plan's failure to so provide. In addition, the provisions require annual reviews of plans that result in diminished use of Indiana coal. The court first notes that the ECPA contains provisions virtually identical to sections of the Illinois Coal Act that the court held unconstitutional in Alliance for Clean Coal v. Miller, 25 ELR 20510 (7th Cir. 1995). The court finds that the ECPA discriminates against interstate commerce based solely on geographic origin. The clear intent of the statute is to benefit Indiana coal at the expense of western coal. The fact that the Act does not explicitly forbid the use of out-of-state coal or require the use of Indiana coal, but "merely encourages" utilities to use high-sulfur coal by providing economic incentives does not make the ECPA any less discriminatory. The court finds specious the state's argument that the approval process under the ECPA is voluntary. Finally, the court holds that ensuring a regional market—the justification the state offers for the Act—is not a proper justification for discriminating against interstate commerce.

[The district court's opinion is published at 26 ELR 20546.]

Counsel for Plaintiff
R.R. McMahan
Lord, Bissell & Brook
115 S. La Salle St., Chicago IL 60603
(312) 443-0328

Counsel for Defendants
Daniel Kelley
Ice, Miller, Donadio & Ryan
One American Sq., Indianapolis IN 46282
(317) 236-2100

Before CUMMINGS, RIPPLE and MANION, Circuit Judges.