In the latest legal defeat for the coal industry, a federal judge has issued a ruling that effectively closes an alleged loophole in air quality regulations created by Bush Administration efforts to undermine the Clean Air Act. The ruling also hands environmental groups a victory in the ongoing battle to derail the infamous Cliffside coal-fired power plant in western North Carolina.

Yesterday, Judge Lacy H. Thornburg of the U.S. District Court for the Western District of North Carolina ruled that Duke Energy must comply with provisions in Section 112 of the Clean Air Act that call for the Maximum Achievable Control Technology (MACT) for certain hazardous air pollutants emitted from power plants. The court found that the proposed 800-MW expansion to the Cliffside coal-fired power plant qualifies as a “major source” of hazardous air pollutants subject to Section 112, and that Duke Energy must therefore, within 10 days, initiate proceedings with the North Carolina Department of Environmental and Natural Resources to comply with the Act’s MACT provisions. The challenge was brought by the Southern Alliance for Clean Energy, EDF, the National Parks Conservation Association, NRDC, and the Sierra Club.

As the plaintiffs’ original complaint explains, in 2000, in the waning days of the Clinton Administration, the EPA added “electric utility steam generating units” (such as coal-fired power plants) to the list of potential sources of hazardous air pollutants subject to MACT provisions under Section 112. However, in 2005, under President Bush, the EPA attempted to delist these units, a move that was aggressively challenged by “numerous states, tribes, and environmental organizations,” and was ultimately vacated by the United States Court of Appeals for the D.C. Circuit earlier this year.

Ten days before the Circuit Court’s ruling, Duke Energy obtained an Air Quality Permit from the State of North Carolina to build the Cliffside plant without complying with MACT provisions, audaciously referring to them later as “a pre-construction requirement that did not exist when the North Carolina Division of Air Quality issued a Clean Air Act permit to construct Cliffside Unit 6 and Duke Energy commenced construction.”

As the NRDC explains in its press release:

[Yesterday’s] decision clearly rejected Duke Energy’s arguments that their plant had slipped through a loophole allowing them to avoid federal pollution controls. Additionally, the court rejected assertions that Duke could substitute voluntary efforts for the mandatory requirements of the Clean Air Act and Duke’s last-minute claims that the plant’s emissions were too small to require additional controls.

The ruling is the most recent instance of a court or other reviewing body effectively informing the Bush EPA that its assorted efforts to circumnavigate, gut, or simply ignore provisions of the Clean Air Act are patently unlawful. Two weeks ago, the EPA’s Environmental Appeals Board remanded a permit issued for the “Bonanza” power plant in Utah because the EPA had failed to demonstrate why it should not, pursuant to the Clean Air Act, establish BACT requirements for CO2 for new coal-fired power plants. The Cliffside ruling stands as yet another reminder of how the Bush EPA has targeted a wide range of well-established environmental regulations, such as those seeking to limit long-recognized toxic air pollutants, in addition to its efforts to thwart meaningful regulation of greenhouse gas emissions.

The case is Southern Alliance for Clean Energy et. al. v. Duke Energy Carolinas, LLC (No. 08-00318, filed 07/16/2008 in the U.S. District Court for the Western District of North Carolina).