Bloomberg News

EPA Cement Factory Rules Are Flawed, Industry Tells U.S. Court

October 11, 2011

Oct. 11 (Bloomberg) -- U.S. rules meant to cut mercury emissions and other air pollutants at cement plants are too restrictive and based on flawed data, a lawyer for the industry told a federal appeals court.

A three-judge panel in Washington heard arguments today in challenges to Environmental Protection Agency regulations set to be enforced in 2013. The cement industry predicts the rules may cost $3.4 billion and shutter 18 of 100 plants.

“No existing plant can achieve any of these in combination,” said Carter Phillips, a partner at Sidley Austin LLP in Washington who represents the Portland Cement Association, an industry trade group. He told the panel that the EPA rules are “unreasonable” because they are based on “pollutant-by-pollutant” analyses instead of the sources of pollution as a whole.

The EPA says the cost would be no more than $950 million.

The Portland Cement Association, based in Skokie, Illinois, is also lobbying Congress to block the EPA rules on behalf of companies such as Cemex SAB, the largest producer of cement in the U.S., and Holcim Ltd.

Last week, the U.S. House of Representatives passed legislation that would force the EPA to scrap and rewrite the cement plant regulations. The bill hasn’t been taken up by the Senate. President Barack Obama’s administration issued veto threats on Oct. 3.

Limestone, Minerals

Cement plants melt limestone and other minerals to go into concrete, used in roads, bridges and buildings, at temperatures that can exceed 3,000 degrees Fahrenheit (1,649 degrees Celsius), generating mercury pollution that ranks second behind that from coal-fired power plants, according to the EPA.

Mercury, which can harm development of children’s brains, is released when cement components such as clay, limestone and shale are heated in a kiln, according to EPA documents.

The EPA rules also mandate cuts in acid gases, sulfur dioxide and particulate matter.

The trade group claims that the EPA double-counted kilns while classifying them under the rule and the agency didn’t give proper notice to let the industry protest the proposed rules before they became final. After that, Phillips said, the EPA indicated it was reconsidering its standards related to plant modifications.

Justice Department

At today’s hearing, judges David Tatel and Janice Rogers Brown asked Justice Department lawyers whether EPA’s rulemaking put the cement industry in a position of making investments that it may learn later it didn’t have to make.

Justice Department attorney Daniel Dertke said the agency was required to issue regulations based upon the information it had at the time.

“There has to be an end point for the EPA to issue enforceable emission standards,” he said, adding that the rules were “a long time coming.”

Tashiba Peoples, another department lawyer, told the judges that Portland Cement Association commented on every proposal before the agency and that some of those comments influenced its decision-making.

The cases are Portland Cement Association v. EPA, 11-1358 and 11-1359, U.S. Court of Appeals for the District of Columbia (Washington).

--With assistance from Mark Drajem in Washington. Editors: Peter Blumberg, Charles Carter

To contact the reporter on this story: Tom Schoenberg in Washington at tschoenberg@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.


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