Scuttling a high-profile “public nuisance” lawsuit, a federal appeals court has reversed a lower court ruling that required the Tennessee Valley Authority to accelerate plans to install pollution controls at four TVA coal-fired power plants to reduce the amount of pollution blowing into western North Carolina, saying the lower court decision could lead to other public nuisance suits that would wreak havoc on federal and state regulatory regimes for combating air pollution.

The ruling, handed down July 26 by a three-judge panel of the U.S. Court of Appeals for the Fourth Circuit, said the lower-court opinion finding that pollution from the four TVA plants constitutes a “public nuisance” is impermissible because it would result in “a balkanization of clean air regulations and a confused patchwork of standards, to the detriment of industry and the environment alike.”

The January 2006 lawsuit at issue in the ruling is one of several brought by North Carolina Attorney General Roy Cooper (D) targeting polluters in upwind states whose emissions he said contributed to North Carolina’s failure to attain federal air quality standards.

The suit stems in part from provisions in the North Carolina Clean Smokestacks Act, a 2002 law that imposed stringent emission reductions for the state’s coal-fired power plant fleet and also authorized the attorney general to sue neighboring states to force them to impose similarly stringent reductions on power plants within their borders.

But the suit also reflects Cooper’s frustration with regulatory initiatives implemented by the Environmental Protection Agency under former President George W. Bush, including the Clean Air Interstate Rule (CAIR), a regional air quality program affecting 28 states and the District of Columbia and aimed at helping these states meet 1997 ambient air quality standards for smog and soot.

While CAIR was being implemented, Cooper filed a petition under Section 126 of the federal Clean Air Act asking the agency to order Tennessee and other states to reduce its pollution, alleging their failure to do so was preventing North Carolina from attaining the air quality standards.

EPA ultimately rejected the North Carolina petition, saying it believed that the emissions reductions expected to result from the full implementation of CAIR would solve the state’s air quality problems.

However, North Carolina and a host of other states, utilities and environmental organizations challenged CAIR, and the U.S. Court of Appeals for the District of Columbia Circuit ultimately vacated that rule, saying that among other glaring faults CAIR failed to develop state air pollution limits that ensured upwind states would not contribute to the failure of downwind states to achieve the 1997 standards.

The D.C. Circuit later allowed the first phase of CAIR emission limits to remain in force, saying a variety of petitioners said they were needed to preserve air quality benefits. Last month, EPA unveiled the Air Transport Rule, a proposed regulation aimed at reducing pollution across 31 states while meeting the objections raised by the D.C. Circuit in striking down CAIR.

Cooper’s 2006 TVA lawsuit asked U.S. District Court Judge Lacy Thornburg to issue an injunction requiring TVA to meet specific emissions caps and install specific emissions control technologies at the four plants by 2013. TVA was already planning to install the controls, but on a longer time frame, and said the court-imposed deadline would raise the costs of its efforts by $1 billion.

After Thornburg agreed with North Carolina and ordered TVA to comply with the accelerated schedule, TVA appealed to the Fourth Circuit, which responded by striking down Thornburg’s injunction.

At the crux of the decision was a clear agreement among the three members of the panel that allowing nuisance suits such as Cooper’s would open the floodgates for other, similar constructed legal challenges that could threaten the intricate statutory and regulatory framework for reducing air pollution hammered out by Congress and the states over the past three decades.

“It ill behooves the judiciary to set aside a congressionally sanctioned scheme of many years’ duration—a scheme, moreover, that reflects the extensive application of scientific expertise and that has set in motion reliance interests and expectations on the part of those states and enterprises that have complied with its requirements,” Judge J. Harvie Wilkinson wrote for the three-judge panel.

“To replace duly promulgated ambient air quality standards with standards whose content must await the uncertain twists and turns of litigation will leave whole states and industries at sea and potentially expose them to a welter of conflicting court orders across the country.”

Wilkinson said that allowing Cooper’s and other nuisance suits to go forward could actually exacerbate air pollution.

“Differing standards could create perverse incentives for power companies to increase utilization of plants in regions subject to less stringent judicial decrees. Similarly, rushed plant alterations triggered by injunctions are likely inferior to system-wide analysis of where changes will do the most good.

“This ruling is disappointing but the fight for clean air is far from over,” Cooper said in a July 26 press release.

Cooper did not indicate whether he would seek an en banc review of the panel’s decision by the full appellate court or whether he would appeal the decision to the U.S. Supreme Court

Chris Holly is a reporter for COAL POWER’s sister publication, The Energy Daily.