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Federal District Court Orders Compliance with EPA Requests for Information Concerning Future Capital Projects Under the Clean Air Act

Beveridge & Diamond, P.C., October 6, 2010

On September 27, 2010, the U.S. District Court for the District of Minnesota granted a preliminary injunction ordering the owner and operator of a major source regulated under the Clean Air Act (“CAA”) to provide to EPA documents relating to capital projects planned to begin within the next two years.  See United States v. Xcel Energy, Inc., No. 10-2275 (D. Minn. Sept. 27, 2010).  The decision gives some credence to EPA’s recent efforts to request information related to planned projects that have not yet been implemented.  At the same time, the limited legal basis for the court’s opinion may limit the circumstances under which EPA may request such information.   

Section 114 of the CAA provides EPA broad authority to request information, as long as the requested information is for one of three approved purposes: (1) to assist the Agency in developing rules or regulations; (2) to determine whether “any person is in violation” of any CAA requirement; or (3) to carry out “any provision of this chapter[.]”  CAA § 114(a), 42 U.S.C. § 7411(a).  During the summer of 2009, EPA issued information requests to Xcel Energy, Inc (a public utility), ostensibly to assess Xcel’s compliance with the CAA’s Prevention of Significant Deterioration (“PSD”) program, which requires preconstruction permitting for certain large projects.  While the bulk of the requests sought information regarding past projects, two requests focused on potential future projects that had not yet been initiated.  Slip Op. at 2.  Xcel refused to provide any information about future projects.  In March, 2010, after Xcel rebuffed multiple EPA offers to narrow the range of documents sought, EPA sued, seeking both injunctive relief and penalties.  Id. 

In support of its request for a preliminary injunction, EPA argued that § 114(a) allows it to obtain any information that it “may reasonably require” to “determin[e] whether any person is in violation” of a CAA standard. 42 U.S.C. § 7414(a).  The court disagreed.  While the court recognized EPA’s “broad discretion” under § 114, it noted that § 114 is written in the present tense.  Therefore, because “Xcel cannot violate [PSD preconstruction permitting requirements] until it ‘commences construction,’” the court concluded that EPA’s authority under this provision did not extend to future projects.  Slip Op. at 9.   

Nevertheless, the court found support for EPA’s request under the third prong of § 114: EPA’s authority to seek information to carry out “any provision of this chapter[.]”  The court pointed out that § 167 of the CAA specifically empowers EPA to seek injunctive relief to “prevent the construction or modification of a major emitting facility” in violation of PSD requirements.  42 U.S.C. § 7477.  Here, the court noted that the permitting process typically takes up to two years; therefore, EPA could reasonably seek information for projects planned within that period, so that EPA would have the opportunity to analyze the projects’ potential emissions and, if necessary, take action under § 167 to prevent a project requiring a permit from proceeding without a permit.  Id. at 10-11; 13-14.  

The Xcel decision attempts to strike a balance between EPA’s reasonable need for information to implement the CAA requirements and companies’ reasonable desire to, as the court put it, keep EPA from gaining a seat at the “planning and approval table.”  Id. at 14.  While the court ordered compliance with EPA’s request for information regarding future projects, the court also suggested that EPA’s authority to issue such a request is limited in several ways: 

  • The court limited the scope of the request to a period that it concluded was reasonably necessary to allow EPA to prevent a pending PSD violation.  Here, the court suggested that EPA’s initial five-year request was overly broad, as was the Agency’s follow-up request for two years of data followed by annual updates.  The court accepted the two-year period because both parties agreed that this timeframe reflected the length of the PSD permitting process. 
  • The court rejected EPA’s argument that it needed information on future projects to assess Xcel’s compliance with the CAA under § 114(a)(ii).  Instead, the court upheld the request only because § 167 specifically authorizes EPA to enjoin future violations, and the court concluded that EPA reasonably needed information on future projects to carry out that provision under § 114(a)(iii). Section 167, however, is limited to PSD permitting issues.  Accordingly, the  opinion suggests that requests for information on future projects will not be allowed unless the information involves potential PSD compliance issues.

As a practical matter, the decision reinforces the old maxim that “bad facts make bad law.”  The court repeatedly noted two facts: (1) EPA had information that several major unpermitted projects were imminent (if not already under construction); and (2) Xcel nevertheless refused to provide any information on these imminent projects.  Given that § 167 specifically orders EPA to take action to prevent future PSD violations, the court simply could not have refused to give the Agency access to the very information it needed to carry out that statutory obligation.

For further information about the District Court’s opinion and its implications, including questions regarding how to respond to an agency-issued information request, please contact Laura Mcafee (, (410) 230-1330), David Friedland (, (202) 789-6047), or Graham St. Michel (, (202) 789-6039).   




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