Company: NC
Filing Date: 2025-03-05
Form Type: 10-K
Source: 0000789933-25-000006
Chunk: 39

Company: NACCO INDUSTRIES INC
Filing Date: 2025-03-05
Form: 10-K
Item: Item 1
Chunk 39
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AAQS for sulfur oxides (SOx) without revision. On May 6, 2024, the EPA lowered the level for particulate matter by 25%. States are required to update their state implementation plans by February 2027. The rule is currently being challenged at the D.C. Circuit by a coalition of states led by Kentucky and West Virginia. Oral argument was held at the D.C. Circuit on December 16, 2024. 

In 2011, the EPA finalized the Cross-State Air Pollution Rule (CSAPR) to address interstate transport of pollutants. While the CSAPR affects states in the eastern half of the U.S. and Texas, it does not affect EGUs in North Dakota. This rule imposes

additional emission restrictions on coal-fired power plants to attain ozone and fine particulate NAAQS. The EPA began

implementation of the rule in 2015, when Phase I emission reductions in sulfur dioxide and nitrogen dioxide became effective.

In 2019, certain states submitted SIPs to the EPA in response to the 2015 ozone standard reduction. On February 13, 2023, the EPA rejected the SIPs. The EPA’s action to deny the SIPs was challenged in various courts, including the 5th Circuit Court 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