Company: NC
Filing Date: 2025-04-07
Form Type: ARS
Source: 0000789933-25-000013
Chunk: 36

Company: NACCO INDUSTRIES INC
Filing Date: 2025-04-07
Form: ARS
Chunk 36
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 of Appeals (the Fifth Circuit). The Fifth Circuit issued a stay of the SIP rejection in Texas, Louisiana, and Mississippi which prevents the federal implementation plan (FIP) from going into effect pending the outcome of the litigation challenges. On June 5, 2023, the EPA published the FIP in the Federal Register. The FIP decreases, over time, the ozone-season NOx allowances allocated to generators in the states not affected by the judicial stay beginning in 2024 by assuming that participants in this cap-and-trade program had or would optimize existing NOx controls and later install additional NOx controls. On July 31, 2023, the EPA promulgated an interim rule (Interim FIP) that addresses the various judicial orders where the SIP rejection has been stayed. The Interim FIP requires these states to return to the previously approved NOx trading program and emission caps. The Interim FIP maintains the state emissions budgets, unit level allowance allocation provisions, and banked allowance holdings reflecting the status quo for the power plants in these states under the Group 2 trading program. In June 2024, the SCOTUS decided to stay the rule pending further review on the merits because the EPA's justifications were flawed. The Ozone Transport Rule was premised on its applicability to 23 states, but litigation resulted in the removal of 12 of those states that accounted for over 70 percent of the emissions the EPA had planned to address. The EPA purported to select control measures that would maximize cost effectiveness in achieving downwind ozone air quality improvements, but it did so based on an assumption that all 23 states would apply the uniform levels of controls required by the FIP. The case was remanded to the D.C. Circuit where the parties fully briefed the case. Subsequent to briefing, the EPA asked to partially remand the rule to "take a supplemental final action addressing the record deficiency preliminarily identified by the Supreme Court." The EPA finalized the supplemental response in December 2024. On February 6, 2025, the EPA filed a motion requesting abeyance of litigation for 60 days to allow a transition to the new administration. On February 21, 2025, the D.C. Circuit denied the EPA's request to hold the litigation in abeyance and extending the briefing schedule through March 27, 2025. Should the FIP be fully implemented in states where a stay has been issued, the rule could influence the closure of some coal- fired