Supreme Court overturns Duke clean air law ruling

By Chris Baltimore

WASHINGTON (Reuters) - A unanimous U.S. Supreme Court on Monday overturned a lower court's ruling that would have allowed utility Duke Energy Corp. to modernize aging coal-fired power plants without reducing air pollutants.

The case had been closely watched by the industry because it could determine whether U.S. electric utilities must spend billions of dollars on emission-reduction equipment and whether similar lawsuits against other U.S. utilities for alleged noncompliance with the Clean Air Act will succeed.

About half of the nation's electricity comes from coal plants, many of which have been operating for decades and need to be overhauled to stay out of mothballs.

The justices set aside a ruling by the Fourth Circuit Court of Appeals that Duke did not need a permit from the U.S. Environmental Protection Agency because hourly emissions from Duke's plants in North and South Carolina would not increase.

Writing the high court's opinion, Justice David Souter said the appeals court's reading of 1980 regulations "was inconsistent with their terms and effectively invalidated them." The case was remanded to the lower court.

Environmental groups had argued that federal law requires utilities to install anti-pollution equipment if they make plant modifications that change their annual - not hourly - emissions of nitrogen oxides, sulfur dioxide, and other pollutants.

Those emissions are linked to heart disease, respiratory ailments and other health problems.

The Natural Resources Defense Council, an environmental group, called the ruling a victory and said it will lead to cleaner air in dozens of U.S. states where coal plants operate -- mostly in the Midwest and Southeast.