“Winning by Losing”…or Some Such Thing

As previously discussed here by yours truly, on May 1, 2015, the U.S. Court of Appeals for the District of Columbia Circuit issued a decision to remand and vacate the so-called 100-hour “exemption” for RICE providing power to emergency or “back-up” electric generators that take part in a demand response program.  The decision was unanimous and was based on several shortcomings perceived by the D.C. Circuit panel on the part of U.S. EPA in its drafting and finalization of the Reciprocating Internal Combustion Engine (RICE) Rules.  One could say that U.S. EPA was on the losing end of that decision.

Presumably hoping to avoid another such loss, in the form of a similar remand and vacatur of the 50-hour exemption for RICE providing power to non-emergency electric generators that take part in a demand response program, U.S. EPA petitioned and won a voluntary remand without vacatur of the 50-hour exemption provision from the D.C. Circuit Court on September 23, 2015.  This voluntary remand without vacatur was won despite heavy opposition from the state of Delaware and regulated industry groups.

Arguing for the U.S. EPA, the Department of Justice (DOJ) stated that “the 50-hour exemption is less flawed than its 100-hour emergency counterpart.”  Summarizing their position with more than a little incredulity, the opposition stated, “In light of the decision in Delaware Department of Natural Resources (DNREC), et al. v. EPA, the 50-Hour Exemption is indefensible and would surely meet the same fate as the 100-Hour Exemption: vacatur.  By preemptively moving for remand without vacatur, U.S. EPA is hoping to win by losing.  Instead of returning to the status quo ante, U.S. EPA seeks to short-circuit the D.C. Circuit Court’s review and leave in place, for an unspecified but likely prolonged period, a Final Rule that it all but acknowledges is deeply flawed.”

What does this mean for your RICE?  It means that U.S. EPA will be going back to the drawing board and retooling those portions of the RICE Rules that pertain to the 50 and 100-hour exemptions.  It also means that the 100-hour exemption does not currently exist (remand with vacatur) and RICE operating as part of an emergency demand response program need to comply with all applicable requirements during such periods.  However, since 50-hour exemption does still technically exist (remand without vacatur), it means that RICE operating in a non-emergency demand response capacity can still do so for 50 hours per year while U.S. EPA retools the RICE Rules.

Have further questions?  Feel free to give me a call to discuss at (610) 933-5246 ext. 119 or email at rharding@all4inc.com.