Chapter 1. History and Structure of the Clean Air Act

Theodore L. Garrett and Sonya D. Winner

Editors' Summary: On November 15, 1990, President Bush signed into law the Clean Air Act Amendments of 1990, the first comprehensive changes to the Act in 13 years. During the intervening months since its enactment, EPA has geared up, streamlined, and commenced its rulemaking processes to accommodate the regulatory burden the new law places on the Agency. As amended by the 1990 amendments, the Clean Air Act instructs EPA to promulgate 27 rules during each of the first two years. However, EPA must do much of its interpretation and rulemaking of the new Act's mandates without the aid of a comprehensive legislative history, because Congress rushed to get the 1990 amendments passed before the end of the 101st Congress. The minimal conference report and other reports related to passage of the amendments have already proved troublesome where the language Congress used is ambiguous. For example, litigation and political pressure have embroiled EPA's WEPCo rulemaking, which addresses how the amended Act's new source performance standards and new source review programs are to be applied to electric utilities' plans to renovate existing facilities. This may be only the tip of the struggles that EPA will face in implementing the new law.

In this three part series of Articles, the authors provide a comprehensive analysis of the Clean Air Act, from its origins through the 1990 amendments and their impacts. In Part I, the authors discuss the history of the Clean Air Act and provide a section-by-section overview of its provisions. In addition, they explain the Act's focus on national air quality standards, provisions for state implementation plans, and the goal of bringing areas with dirty air into attainment of the standards.

Parts II and III, planned for publication in the next two to three months, will address the 1977 amendments, EPA's post-1987 attainment policy, comprehensive analysis of the 1990 amendments, and impacts of the 1990 amendments on regulatory agencies and industry.

Theodore L. Garrett is a partner in the law firm of Covington and Burling in Washington, D.C. Mr. Garrett has coordinated the firm's environmental practice and has been extensively involved in litigation and administrative proceedings. A former U.S. Supreme Court law clerk to Chief Justice Burger, Mr. Garrett has served as a featured speaker at numerous environmental law and litigation programs, and has written widely in the environmental area. He is a coauthor of the ALI-ABA book A Practical Guide to Environmental Law and the ABA book Environmental Litigation. Mr. Garrett is vice-chairman of the Solid and Hazardous Waste Committee of the ABA Section of Natural Resources, Energy, and Environmental Law; a member of the Steering Committee of the Environment, Energy, and Natural Resources Section of the District of Columbia Bar; a member of the Editorial Board of the Environmental Law Reporter; and a member of the Advisory Committee on Hazardous Waste of the Center for Public Resources.

Sonya D. Winner is a partner in the law firm of Covington and Burling, where she practices in the areas of environmental law, international trade, and antitrust. She is a graduate of Michigan State University (B.A. 1979) and Harvard Law School (J.D., magna cum laude, 1982). After graduation, she served as a law clerk to Judge Louis F. Oberdorfer of the U.S. District Court for the District of Columbia. She is a member of the adjunct faculty at the American University Washington College of Law, where she has taught courses in international commercial arbitration and legal ethics.

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The Clean Air Act¹ establishes a framework for the attainment and maintenance of air quality standards. It sets emission standards for motor vehicles and fuels, regulates hazardous air pollutants, protects stratospheric ozone, and deals with acid rain. The modern Clean Air Act was enacted in 1970 and has served as a model for other federal environmental legislation. As amended in 1990, the statute is sweeping in scope, affecting thousands of businesses across many industries.

The Clean Air Act presents a considerable challenge to industry to understand the requirements of the law, to prepare and participate in federal and state activities implementing the statute, and to consider how to plan for compliance. Under the 1990 amendments, the U.S. Environmental Protection Agency (EPA) and the states will develop hundreds of new regulations, informal policies, guidance documents, and agency opinions.

This chapter reviews the history of the Clean Air Act. It then discusses the basic structure of the Clean Air Act in broad terms, setting the stage for more detailed discussion of particular provisions in subsequent chapters.

I. History of the Clean Air Act

Air pollution was first controlled locally, then later became predominantly a state responsibility. The first federal initiative, the Air Pollution Control Act of 1955, focused on research and on financial and technical support for state programs.² The Department of Health, Education, and Welfare (HEW) was responsible for these efforts. The Clean Air Act of 1963 expanded the federal role, authorizing HEW to establishment air quality criteria.³ However, these criteria were not mandatory: states could use them as they saw fit.

Congress amended the Clean Air Act in 1967, adding several new features.⁴ It now required the states, in consultation with HEW, to designate air quality control regions. The states were also required to adopt ambient air quality standards and to develop implementation plans to achieve those standards. These implementation plans consisted of state regulations setting forth emission limitations and other provisions. Finally, the 1967 Act required HEW to develop reports on pollution and control techniques, making available information on current technology.

The federal air quality program was considered flawed in several ways. First, the statute did not clearly define its goals. There were no federal air pollution standards. Second, the statute did not provide for effective federal enforcement. Federal officials could only encourage the states to develop enforcement programs.

The Clean Air Act Amendments of 1970 addressed the perceived flaws, establishing a model for later environmental legislation.⁵ One senator called the 1970 amendments the most fundamental piece of legislation ever enacted by Congress.⁶ The amendments introduced the command-and-control approach to federal environmental legislation. They established the basic structure and policies still present in the current Clean Air Act. The legislation authorized the newly created EPA to carry out the Act's provisions.

The 1970 Act contained a number of important provisions, including several key features. First, Congress envisioned a new kind of federal and state partnership. The federal government gained greater influence, with EPA directed to establish national air quality standards. However, Congress preserved the primary role of the states, allowing them to adopt measures needed to attain air quality standards. States were required to develop implementation plans, which consisted of regulations establishing emission limits for individual sources.

Second, the 1970 amendments contained deadlines and strengthened enforcement. The statute mandated attainment by 1975, with some exceptions to 1977. Congress provided for enforcement of emission limitations and state plans with measures involving both the states and the federal government. To provide a fallback mechanism, the law also allowed EPA to establish a federal plan in a particular area if the state failed to act.

Third, the 1970 amendments sought to stimulate the development of new technology. New sources were required to meet standards based on the best available technology. In § 111 of the Act, EPA was authorized to set new source performance standards for various industries.

Finally, the Act addressed hazardous pollutants and automobile exhausts. Section 112 authorized EPA to set emission limits for hazardous air pollutants at levels providing an ample margin of safety. Title II of the Act allowed EPA to regulate emissions from mobile sources, giving the Agency authority to control both tailpipe emissions and the composition of fuels and fuel additives.

Later amendments sought to resolve other shortcomings and address new issues. The energy crisis of 1973-74 brought about the Energy Supply and Environmental Coordination Act of 1974.⁷ It amended the Clean Air Act to increase the use of domestic fuels through temporary waivers of the emission control requirements.

The deadlines of the 1970 Act proved too ambitious, and many areas of the country remained out of compliance with the national air quality standards. The Clean Air Act Amendments of 1977 added to Title I of the Act a new Part D, which established a new schedule for compliance by 1982, with extensions until 1987 in nonattainment areas.⁸

The amendments also required state plans to provide for "reasonably available control technology" (RACT) for existing major stationary sources (generally defined as those over 100 tons per year). States were also required to adopt permit programs for the construction of new or modified [22 ELR 10162] major stationary sources. Emissions from these sources would be controlled with technology to meet the "lowest achievable emission rate" (LAER). The permit-issuing agency would determine the LAER requirement on a case-by-case basis, and permits could be issued only if emissions from the new or modified source were offset by reductions from other sources in the area.

The 1977 amendments also imposed new requirements on clean areas already in attainment. The prevention of significant deterioration (PSD) program arose out of the Sierra Club's successful suit to stop EPA approval of plans that allowed deterioration of clean air up to the national standards. The 1977 amendments established specific increments for maximum allowable increases in ambient concentrations for three classes of PSD areas. The PSD program also included a permit program for new major sources and modifications. It required sources to apply best available control technology (BACT), which is again determined on a case-by-case basis.

As time passed, some of the old problems under the Clean Air Act persisted, and new problems developed. Despite significant reductions in emissions from automobiles and large industrial sources, many areas of the country continued to be out of compliance. Air pollution in some areas, such as Los Angeles, was quite serious. Air pollution problems also became more complex and intractable. The Air Toxics Program under § 112 was considered inadequate, setting standards for only seven substances, many subject to years of litigation. In addition, the acid rain issue came to the forefront, causing extensive debate on the nature of the problem and an appropriate federal response.

These issues set the stage for the 1990 amendments. Congress had considered amendments to the Act for most of the 1980s, but the debate was protracted and frequently acrimonious. In June 1989, President Bush announced the administration's Clean Air Act proposals, and in July the administration's bill was sent to Congress. This legislation was widely viewed as a solid, middle-of-the-road proposal that would break the previously existing logjam. The Senate and the House passed bills in April and May 1990. Both houses passed a conference agreement on October 26, 1990, and the President signed the bill on November 15, 1990.⁹

With respect to nonattainment, Congress adopted a more detailed and graduated program, reflecting the fact that problems in some areas are more difficult and complex than in others. There are now six categories of nonattainment areas for ozone, ranging from marginal to extreme. The amendments give the states more time to meet these national standards, ranging from three years for marginal areas to 20 years for Los Angeles. Sources in these areas will have to implement different control measures, depending on the area's classification. The new Act requires controls on much smaller sources.

Congress also dealt with the subject of air toxics. The 1990 amendments completely revise § 112, establishing a list of 189 regulated hazardous air pollutants. EPA is required to establish standards for major sources, which are defined as those with the potential to emit 10 tons per year of any hazardous pollutant or 25 tons of any combination of them. These sources must meet emission limits based on the use of maximum achievable emission control technology (MACT).

Perhaps the biggest regulatory change in the Act is the new permit program, which is modeled on the Clean Water Act's program. Under Title V of the Act, all major sources are now required to obtain an operating permit. States with approved permitting programs issue permits, but EPA has the ability to veto state permits. Citizens also have certain rights to challenge state permits. This program is funded by a new system of permit fees.

With respect to acid rain, the Act contains new provisions designed to reduce emissions of sulfur dioxide. It establishes a novel allowance system, based on a nationwide limit of 8.9 million tons of sulfur dioxide per year. Allowances can be sold on the open market. This market-based mechanism is being touted as a model for other regulatory programs. For mobile sources, the amendments revise tailpipe emission and gasoline formulation standards.

Finally, the amendments considerably strengthen enforcement provisions of the Clean Air Act. EPA is given new power to issue administrative penalties of up to $ 25,000 per day for each violation. The law also allows EPA to issue administrative field citations of up to $ 5,000. Criminal penalties are upgraded from misdemeanors to felonies in a number of situations. Finally, the role of citizens is enhanced. Citizens can now bring suits as well as obtain penalties and attorneys fees. The act also includes a $ 10,000 "bounty hunter" award for providing information leading to a civil or criminal penalty.

In summary, the 1990 amendments are a comprehensive and detailed set of measures. The amended Act regulates more sources and smaller sources than before. There is now a series of technology-based requirements applicable to existing and new sources and modifications. A given plant may well be subject to several of these requirements, which will be developed over a period of years. This will make planning for compliance a considerable challenge.

II. Overview of the Clean Air Act

The following is a brief overview of the statute, organized by section.

A. National Ambient Air Quality Standards/Section 109

The principal regulatory program established under the Clean Air Act has two basic elements: nationwide air quality goals and individual state plans designed to meet those goals. Under § 109, EPA is required to promulgate health-based primary and secondary national ambient air quality standards (NAAQS) for "criteria" pollutants.¹⁰ Pursuant to § 109, EPA has promulgated the NAAQS for six criteria [22 ELR 10163] pollutants: sulfur dioxide, particulate matter, nitrogen dioxide, carbon monoxide, ozone, and lead.¹¹

B. State Implementation Plans/Section 110

Once the NAAQS are established, the Act requires each state to submit a plan for the implementation, maintenance, and enforcement of the national standards within its jurisdiction. State implementation plans (SIPs) are based on emission inventories and computer models that attempt to predict whether air quality violations will occur. The Act gives each state the freedom to design its SIP as it chooses, selecting whatever mix of regulatory requirements it believes will attain the national standards and be consistent with the state's political, economic, and social policy concerns. EPA reviews each SIP and may approve or disapprove the SIP, in whole or in part.¹² Once a SIP receives EPA approval, it becomes an element of federal and state law and may be enforced by both federal and state authorities. If a state fails to gain approval of its SIP, EPA may promulgate a plan of its own: a federal implementation plan (FIP).

C. New Source Performance Standards/Section 111

Under § 111, EPA is authorized to establish new source performance standards (NSPS), which impose federal technology-based requirements on emissions from new or modified major stationary sources of pollution. EPA is directed to establish standards for new sources that will

reflect the degree of emission limitation and the percentage reduction achievable through application of the best technological system of continuous emission reduction which (taking into consideration the cost of achieving such emission reduction, any nonair quality health and environmental impact and energy requirements) the Administrator determines has been adequately demonstrated.¹³

EPA has developed NSPS standards for a number of industry categories.¹⁴ Initial responsibility for implementing and enforcing regulations under § 111 is lodged with EPA, but § 111(c) allows such responsibility to be delegated to any state that develops appropriate procedures for doing so.¹⁵

D. National Emission Standards for Hazardous Air Pollutants/Section 112

The Act authorizes EPA to establish health-based national emission standards for hazardous air pollutants (NESHAP) to protect the public from these pollutants.¹⁶ Since 1970, EPA has listed only eight hazardous air pollutants and has established standards for only seven.¹⁷ The 1990 amendments direct EPA to establish technology-based standards for 189 hazardous substances based on the use of "maximum achievable control technology" or MACT. The amendments also authorize EPA to establish a program for the prevention of accidental releases.¹⁸

E. Prevention of Significant Deterioration/Sections 160-169A

Section 161 of the Act requires each SIP to "contain emission limitations and such other measures as may be necessary, as determined under regulations promulgated under this part, to prevent significant deterioration of air quality" in each region of the state in which the air quality exceeds national standards. Section 165(a) establishes preconstruction permitting requirements for new major emitting facilities in attainment areas.¹⁹ Such facilities must achieve emission limits based on the BACT for each regulated pollutant.²⁰

F. Nonattainment Areas/Sections 171-178

Regions that have failed to meet the NAAQS for one or more criteria pollutants are designated as "nonattainment" areas. The original deadline for attainment was 1975, but this date has been extended several times by Congress. In the meantime, states were required to make "reasonable further progress" toward achievement of the standards, and existing sources were required to meet emission limits based on RACT.²¹ New or modified major stationary sources proposed for nonattainment areas are required to comply with stringent permitting requirements, including a showing that offsetting reductions from other sources will produce a net decrease in total emissions in the area, and achievement of the "lowest achievable emission rate" (LAER).²²

Under the 1990 amendments, Congress divided nonattainment areas into several categories and set more realistic deadlines based on the effort needed to achieve compliance. The deadlines range from 1993 in marginal areas to 2010 for Los Angeles. Offsets for new or modified sources will be more difficult to obtain. The amendments also authorize EPA to issue control-technique guidance documents for various industry categories, and to control VOC emissions from consumer and commercial products.

G. Emission Standards for Mobile Sources/Sections 201-234

Believing that motor vehicle pollutants constitute a difficult air pollution problem, Congress in 1970 established allowable levels of auto emissions and authorized EPA to control fuels and fuel additives. The 1990 amendments establish lower emission standards for automobiles and other vehicles. The amendments also contain new provisions for alternative fuels and for the use of "clean fuel" vehicles.

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H. General Provisions/Sections 301-327

Title III of the Act contains general provisions including definitions, reports to Congress, and appropriations. Section 307 contains procedures for EPA rulemaking and judicial review, which are significant for virtually all of EPA's regulatory activities under the Act.²³ Judicial review generally is available in the U.S. Courts of Appeals. Section 304 authorizes citizen suits against EPA for failure to perform a nondiscretionary duty or against other persons alleged to be in violation of an emission limitation, standard, or order.²⁴

I. Acid Deposition/Sections 401-413

Title IV of the Act, added in 1990, contains new requirements for electric utilities to address acid rain issues. The amendments include stringent sulfur dioxide controls on existing and new plants. They also create a system of market-based allowances, which is regarded as an important test of the success of market-based environmental solutions.²⁵

J. Permits/Sections 501-507

New Title V of the Act, enacted in 1990, establishes for the first time a universal federal permit program for existing stationary sources. Modeled after the Clean Water Act, the program is expected to be implemented by the states using a new system of permit fees to cover costs. Permit requirements will include emission limits and other appropriate conditions. EPA is authorized to review state permits and to veto those not in compliance with the Act.²⁶

K. Stratospheric Ozone/Sections 601-618

Title VI of the Act, added in 1990, deals with depletion of the ozone layer. The 1990 amendments phase out the production and consumption of ozone-depleting substances, authorize EPA to ban nonessential products containing those substances, require labeling of products manufactured with those products, and regulate the replacement of those products with substitutes.²⁷

The foregoing provisions are discussed in greater detail below.

1. Clean Air Act (CAA) §§ 101-618, 42 U.S.C. §§ 7401-7671q, ELR STAT. CAA 6-183.

2. Air Pollution Control Act of 1955, ch. 360, 69 Stat. 322.

3. Clean Air Act of 1963, Pub. L. No. 88-206, 77 Stat. 392.

4. Air Quality Act of 1967, Pub. L. No. 90-148, 81 Stat. 465.

5. Clean Air Act Amendments of 1970, Pub. L. No. 91-604, 84 Stat. 1676.

6. 116 CONG. REC. S20607 (Dec. 18, 1970) (statement of Sen. John Sherman Cooper).

7. Energy Supply and Environmental Coordination Act of 1974, Pub. L. No. 93-319, 88 Stat. 246.

8. Clean Air Act Amendments of 1977, Pub. L. No. 95-95, 91 Stat. 685.

9. Clean Air Act of 1990, Pub. L. No. 101-549, 104 Stat. 2399.

10. 42 U.S.C. § 7409, ELR STAT. CAA 18. Primary standards are defined in § 109(b)(1) of the Act "as ambient air quality standards the attainment and maintenance of which in the judgment of the Administrator, based on such criteria and allowing an adequate margin of safety, are requisite to protect the public health." Section 109(b)(2) requires secondary standards to "specify a level of air quality the attainment and maintenance of which in the judgment of the Administrator, based on such criteria, is requisite to protect the public welfare from any known or anticipated effects associated with the presence of such air pollutants in the ambient air."

11. 40 C.F.R. pt. 50 (1991).

12. CAA § 110(a)(2), 42 U.S.C. § 7410(a)(2), ELR STAT. CAA 20.

13. CAA § 111(a)(1), 42 U.S.C. § 7411(a)(1), ELR STAT. CAA 25.

14. EPA's regulations under § 111 are published at 40 C.F.R. part 60.

15. A list of states that have reviewed such delegated authority may be found at 40 C.F.R. § 60.4.

16. CAA § 112, 42 U.S.C. § 7412, ELR STAT. CAA 28.

17. EPA has established standards for asbestos, beryllium, mercury, vinyl chloride, radionuclides, inorganic arsenic, and benzene. No standard has been promulgated for coke oven emissions. EPA's regulations under § 112 are published at 40 C.F.R. part 61.

18. CAA § 112(r), 42 U.S.C. § 7412(r), ELR STAT. CAA 40.

19. 42 U.S.C. § 7475(a), ELR STAT. CAA 68.

20. 42 U.S.C. § 7475(a)(4), ELR STAT. CAA 68. EPA's PSD regulations, including its requirements for PSD provisions in SIPs, are set forth at 40 C.F.R. § 52.51.

21. CAA § 172(b)(1), (3), 42 U.S.C. § 7502(b)(1), (3), ELR STAT. CAA 74 (amended 1990).

22. CAA § 173, 42 U.S.C. § 7503, ELR STAT. CAA 76.

23. 42 U.S.C. § 7607, ELR STAT. CAA 134.

24. 42 U.S.C. § 7604, ELR STAT. CAA 134.

25. See CAA §§ 401-413, 42 U.S.C. §§ 7651-7651l, ELR STAT. CAA 148-164.

26. See CAA §§ 501-507, 42 U.S.C. §§ 7661-7661f, ELR STAT. CAA 168-173.

27. CAA §§ 601-618, 42 U.S.C. §§ 7671-7671q, ELR STAT. CAA 174-183.