### SETTLEMENT AGREEMENT

This Settlement Agreement-is made by and between the following groups of Petitioners:

(1) the States of 

### New York, Californa, Connecticut, Delaware, Maine, New Mexico, Oregon, Rhode Island, Vermont, and Washington, the Commonwealth of Massachusetts, the District of

Columbia, and the City of 

### New York (collectively "State Petitioners"); and (2) Natual 

### Resources Defense Council (NRDC), Sierra Club, and Environmental Defense Fund (EDF) 

### (collectively "Environmental Petitioners"), and Respondent, the u.S. Environmental Protection Agency ("EP A") (collectively "the Paries"). 

### WHREAS, EP A published a final action entitled "Standards of Performance for Electric Utilty Steam Generating Units, In(tustrial-Commercial-Institutional Steam Generating Units, 

### and Small Industral-Commercial-Institutional Steam Generating Units," 71 Fed. Reg. 9,866 (Feb. 27, 2006) (the "Final Rule"); WHEREAS, the Final Rule included amendments to the stadards of performance for 

### electric utilty steam generating unts subject to 40 C.F.R. par 60, subpar Da ("EGUs"); WHEREAS, in connection with this Final Rule, EP A declined to establish standards of 

### performance for greenhouse gas ("GRG") emissions;

WHEREAS, State and Environmenta Petitioners filed petitions for judicial review of 

### the 

### . Final Rule under the Clean Air Act ("CAA") Section 111, 42 U.S.c. § 7411, contending, inter alia, that the Final Rule was required to include stadards of performance for GRG emissions from EGU s;

WHEREAS, the portions of 

### State and Environmental Petitioners' petitions for review of
. the Final Rule that related to GRG emissions were severed from other petitions for review of 

### the 

### Final Rule, and were formerly pending before the United States Cour of Appeals for the District Page i of 11

### of Columbia Circuit (the "Cour") under the caption State of New York, et al. v. EP A, No. 06-

1322;

### WHEREAS, following the Supreme Cour's decision in Massachusetts v. EPA, 549 U.S.

497 (2007), EPA requested remand of the Final Rule to EPA for fuher consideration of 

### the
issues related to GRG emissions in light of that decision; 

### WHEREAS, the Cour remanded the Final Rule to EPA for fuer proceedings on GRG 

### emissions in light of Massachusetts v. EP A, by its Order of September 24, 2007 (the "Remand Order");

WHEREAS, as of the date of 

### this Settlement Agreement, EPA has not taen any publicly noticed action to respond to the Remand Order; WHEREAS, the State Petitioners submitted letters to EP A dated June 16, 2008 and 

### August 4,2009 inquiring as to the status ofEPA's action on the remand and stating their position that EP A had a legal obligation to act promptly to comply with the requirements of Section 111, and Environmenta Petitioners submitted a letter to EP A on August 20, 2010 seeking 

### commitments to ruemakng on GRG emissions from EGUs as a means of avoiding fuher litigation; 

### WHEREAS, EGUs are, collectively, the largest source category of GRG emissions in the 

### United States, according to a recent EPA analysis. See 74 Fed. Reg. 56,260, 56,363 (Oct. 30, 2009);

WHEREAS, EPA's initial evaluation of 

### available GRG control strategies indicates that there are cost-effective control strategies for reducing GRGs from EGUs;

, WHEREAS, EP A believes it would be appropriate for it to concurently propose 

### performance standards for GRG emissions from new and modified EGUs under CAA section
Page 2 of 11

### 111(b), 42 U.S.C. § 7411(b), and emissions guidelines for GHG emissions from existing affected

EGUs pursuant to CAA section 111(d), 42 U.S.C. § 7411(d), and 40 C.F.R. § 60.22; 

### WHREAS, the Paries wish to enter into this Settlement Agreement to resolve the State and Environmental Petitioners' request for performance stadards and emission guidelines for 

### . GHG emissions under CAA sectionslll(b) änd 111(d) and to avoid fuher litigation on this issue, without any admission or adjudications of fact or law; 

### NOW THEREFORE, the Paries, intending to be bound by this Settlement Agreement, hereby stipulate and agree as follows:

1. EPA will sign by July 26,2011, and will transmit to the Offce of the Federal Register within five business days, a proposed rule under section 111 (b) that includes stadards of performance for GHGs for new and modified EGUs that are subject to 40 C.F.R. par 60, subpar Da. EP A shall provide the State and Environmental Petitioners a copy of the 

### proposed rue with five business days of signatue.

2. EPA will also sign by July 26, 2011, and will transmit to the Offce of the Federal Register within five business days, a proposed rue under section 111 (d) that includes 

### emissions guidelines for GHGs from existing EGUs that would have been subject to 40

C.F.R. par 60, subpar Da if 

### they were new sources. EPA shall provide the State and

Environmental Petitioners a copy of 

### the proposed rule within five business days of 

### signatue. 3. After considering any public comments received concernng the proposed rule described 

### in Paragraph 1, EP A will sign no later than May 26, 2012,. and will transmit to the Offce

of

### the Federal Register withn five business days, a final rule that takes final action with respect to the proposed rue described in Paragraph 1. . EP A shall provide the
Page 3 of 11

### Environmental and State Petitioners with a copy of its final action within five business



### days of signatue.

4. IfEPA finalizes standards of 

### performance for GHGs pursuant to Paragraph 3, then based

on consideration of 

### the public comments received concernng the proposed rule described in Paragraph 2, EP A will sign no later than May 26, 2012, and will transmit to the Offce

ofthe Federal Register within five business days, a final rule that taes final action with respect to the proposed rue describe in Paragraph 2. EP A shall provide the State and 

### Environmenta Petitioners with a copy of its final action within five business days of 

### signatue. 5. EP A agrees that it wil make staff available by telephone at least every 60 days to update 

### State and Environmental Petitioners on EPA's progress in completing the actions 

### described in Paragraphs (1) through (4). In addition, EPA will provide State and Environmental Petitioners with a status letter every 60 days, which shall include an affirmative statement of whether EP A believes it will timely complete all actions described in Paragraphs 1 through 4.
6. Upon EPA's fulfillment of each of 

### the obligations stated in Paragraphs 1 through 4 above, this Settlement Agreement shall constitute a full and final release of any claims that State and Environmental Petitioners may have under any provision of law to compel 

### EP A to respond to the Cour's Remand Order with respect to GHG emissions from EGUs. 

### 7. State and Environmenta Petitioners shall not file any motion or petition seeking to 

### compel EP A action in response to the Remand Order with respect to GHG emissions 

### from EGUs uness EPA has first failed to meet an obligation stated in Paragraphs 1
Page 4 of 11

### through 4 above. If EP A fails to meet such an obligation, or if an EP A status letter



### described in Paragraph 5 does not afrm that EP A believes it will timely complete all actions described in Paragraphs 1 through 4, or if EP A fails to send a status letter as 

### described in Paragraph 5 and does not promptly cure that failure upon receiving notice, State and Environmental Petitioners' sole remedy shall be to file an appropriate motion or 

### petition with the Cour or other civil action seeking to compel EP A to take action 

### responding to the Remand Order. In that event, all Paries reserve any claims or defenses they may have in such an action, and the dates stated in Paragraphs 1 through 4 shall be constred to represent only the paries' attempt to compromise claims in litigation, and 

### not to represent agreement that any paricular schedule for fuher agency action is reasonable or otherwse required by law. State and Environmental Petitioners reserve all rights under the law to file petitions for review of final agency actions under ths 

### Settlement Agreement, pursuant to section 307(b), 42 U.S.C. § 7607(b). 8. This Settlement Agreement constitutes the sole and entire understanding ofEPA and the 

### Environmental and State Petitioners and no statement, promise or inducement made by any Par to this Settlement Agreement, or any agent of such Paries, that is not set forth 

### in ths Settlement Agreement shall be valid or binding.

9. Except as expressly provided in this Settlement Agreement, none of the Paries waives or 

### relinquishes any legal rights, claims or defenses it may have. State and Environmental Petitioners reserve the right to seek attorneys' fees and costs relating to this litigation, and EP A reserves any defenses it may have relating to such claims.

10. The provisions of 

### this Settlement Agreement can be modified at any time by written mutual consent of the Paries.
Page 5 of 1111. Except as expressly provided herein, nothing in the terms of ths Settlement Agreement



### shall be constred to limit or modify the discretion accorded EP A by the CAA or by general principles.of administrative law. 12. The commitments by EP A in this Settlement Agreement are subject to the availability of

appropriated fuds. No provision of 

### this Settlement Agreement shall be interpreted as or 

### constitute a commitment or requirement that EP A obligate, expend or pay fuds in

contravention of 

### the Anti-Deficiency Act, 31 U.S.C. 1341, or any other applicable appropriations law or regulation, or otherwise take any action in contravention of those laws or regulations.

13. Nothing in the terms of 

### ths Settlement Agreement shall be constred to limit EPA's authority to alter, amend or revise any final rue EPA may issue pursuant to Paragraphs 3 or 4, or to promulgate superseding regulations. 14. The Paries agree and acknowledge that before this Settlement Agreement is final, EP A 

### must provide notice in the Federal Register and an opportty for public comment pursuant to CAA Section 113(g), 42 U.S.C. 7413(g). After this Settlement Agreement has undergone an opportty for notice and comment, the Administrator and/or the 

### Attorney General, as appropriate, shall promptly consider any such wrtten comments in 

### determining whether to withdraw or withhold her/hs consent to the Settlement

Agreement, in accordance with section 113(g) of the CAA. Withi 30 days of 

### the close of the public comment period, EP A shall provide written notice to State and 

### Environmental Petitioners of any decision to withdraw or withold consent or shall 

### provide wrtten notice of finality. This Settlement Agreement shall become final on the

Page 6 of 11

### date that EP A provides written notice of such finality to the State and Environmental

Petitioners. 15. The undersigned representatives of each Pary certify that they are fully authorized by the Par that they represent to bind that respective Par to the terms of this Settlement 

### Agreement. This Settlement Agreement will be deemed to be executed when it has been signed by the representatives of the Paries set forth below, subject to final approvals pursuant to Paragraph 14. 

## . DATE: iz./,,,hD 

# I I JJ~ ~~~~ /~-

DA VID GUNTER / U.S. Deparment of Justice Environment and Natual Resources Division Environmental. Defense Section 

### P.O. Box 23986 

### Washington, D.C. 20026-3986 

### Counsel for us. Environmental Protection Agency DATE: 

### MICHAL J. MYERS MORGAN A. COSTELLO Assistat Attorneys General 

### Environmental Protection Bureau .... Offce of

### the Attorney General, The Capitol Albany, New York 12224 Counsel for State of New York DATE: 

### KENNETH P. ALEX SUSAN DURBIN 

### Offce of the Attorney General, State of Californa 1515 Clay Street, 20th Floor, P.O. Box 70550 

### Oakand, CA 94612 Counsel for State of California Page 7 of 11date that EP A provides written notice of such finality to the State and Environmental Petitioners. 15. The undersigned representatives of each Pary certify that they are fully authorized by the

Party that theyrepresent to bind that respective Party to the terms of 

### this Settlement 

### Agreement. This Settlement Agreement will be deemed to be executed when it has been
signed by the representatives of 

### the Parties set forth below, subject to final approvals pursuant to Paragraph 14.
DATE: 

### DAVID GUNTER U.S. Department of Justice 

### Environment and Natural Resources Division Environmental Defense Section P.O. Box 23986 

### Washington, D.C. 20026-3986 

### Counsel for us. Environmental Protection Agency 

# DATE:~

# J:Q!J MORGAN A. COSTELLO Assistant Attorneys General 

### Environmental Protection Bureau Offce of 

### the Attorney General, The Capitol Albany, New York 12224 Counsel for State of New York DATE: 

### KENNTH P. ALEX 

### SUSAN DURIN Offce of the Attorney General, State of 

### California 1515 Clay Street, 20th Floor, P.O. Box 70550 

### Oakland, CA 94612 Counsel for State of California Page 7 of11date that EP A provides wrtten notice of such finality to the State and Environmental Petitioners. 15. The undersigned representatives of each Par certify that they are fully authorized by the

Par that they represent to bind that respective Par to the terms of ths Settlement Agreement. This Settlement Agreement wil be deemed to be executed when it has been
signed by the representatives of the Paries set forth below, subject to final approvals pursuant to Paragraph 14.
DATE: DAVID GUNTER U.S. Deparent of Justice Environment and Natual Resources Division Environmenta Defense Section P.O. Box 23986 Washington, D.C. 20026-3986 Counsel for us. Environmental Protection Agency DATE: MICHAEL J. MYERS MORGAN A. COSTELLO Assistat Attorneys General Environmental Protection Bureau Offce of the Attorney Genera, The Capitol Albany, New York 12224 Counsel for State of New York DATE: l"llZ I/o

# ~A~ ETHP. ALEX. SUSAN DURBIN Offce of the Attorney Genei:al, State of California 1515 Clay Street, 20th Floor, P.O. Box 70550 Oakand, CA 94612

Counselfor State of California

Page 7 of 11DATE:

DATE:

DATE:

DATE:

Page 8 of 11 

# øø~ KIMBERL Y MASSICOTTE MATTHEW i. LEVINE Assistant Attorneys General Offce of the Attorney General P.O. Box 120,55 Elm Street Hartford, ConnecticlIt 06141-0 t 20 Coimselfor State o/Connecticut VALERIE M. SATTRFIELD Deputy Attomey General Depaitment of Justice i 02 W. Water Street Dovel', DE 19904 Counsel for State of Delaware

GERALD D. REID Assistant Attorney General Department of the Atto1'ey General State Hoiise Station #6 Augusta, Maine 04333-0006

Counsel for Stelte ofMaine
SETH COHEN STEPHEN R. FARRIS JUDITH ANN MOORE Assistant Attorneys General P.O. Drawer 1508 Santa Fe, New Mexico 87504-1508

Coiinselfor State of New MexicoDATE:


# DATE:~IO

DATE:

DATE:

Page 8 of 11 " l
I l l i KIMBERLY MASSICOTTE MATTHEW i. LEVINE Assistant Attorneys General Offce of the Attorney General P.O. Box 120,55 Elm Street Harford, Connecticut 06141-0120 I. I. i ¡¡ .

~ I ø Counsellor State olConnecticut 

## V ~ SAITERIELD Deputy Attorney General Deparent of Justice 102 W. Water Street Dover, DE 19904 Counsel lor State 01 Delaware

GERALD D. REID Assistat Attorney General Deparent of the Attorney Genera State House Station #6 Augusta, Maine 04333-0006 Counsel lor State 01 Maine
SETH COHEN STEPHEN R. FARRS 

### JUDITH AN MOORE Assistat Attorneys General P.O. Drawer 1508 Santa Fe, New Mexico 87504- 1508 Counsel lor State of New MexicoDATE: 

### KIMBERLY MASSICOTTE MATTHEW 1. LEVINE Assistant Attorneys General 

### Office of the Attorney General 

### P.O. Box 120, 55 Elm Street 

### Harford, Connecticut 06141-0120 Counsel for State of Connecticut DATE: 

### VALERIE M. SATTERFIELD Deputy Attorney General 

### Deparment of Justice 102 W. Water Street 

### Dover, DE 19904 Counsel for State of Delaware 

# f~~ GEm D. REID Assistant Attorney General 

### Deparment of the Attorney General State House Station #6 

### Augusta, Maine 04333-0006 

### DATE: l'J ( 'Y Ii c

Counsel for State of Maine DATE: SETH COHEN STEPHEN R. FARRIS 

### JUDITH ANN MOORE Assistant Attorneys General P.O. Drawer 1508 

### Santa Fe, New Mexico 87504-1508

Counselfor State of New Mexico
Page 8 of 11DATE:

DATE:

DATE:

DATE:

Page 8 of 11 

### KIMBERLY MASSICOTTE 

### MATTHEW i. LEVINE Assistant Attorneys General Office of the Attorney General 

### P.O. Box 120, 55 Elm Street Hartford, Connecticut 06141-0120 Counsel for State of Connecticut


### VALERIE M. SATTERFIELD Deputy Attorney General 

### Deparment of Justice 102 W. Water Street 

### Dover, DE 19904 Counsel for State of Delaware

GERALD D. REID 

### Assistant Attorney General 

### Deparment of the Attorney General State House Station #6 Augusta, Maine 04333-0006 

### 12-/ ej ~.:0 

# i l COHEN

STEPHEN R. FARRIS 

### JUDITH ANN MOORE Assistant Attorneys General P.O. Drawer 1508 

### Santa Fe, New Mexico 87504-1508 Counsel for State of New MexicoDATE: 1 z¡iq¡;o-lC/

DATE:

DATE:

DATE:

Page 9 of 11 

# ~ Assistant Attorney General Deparment of Justice 1162 Cour Street, N.E. Salem, Oregon 97301

Counselfor State of Oregon
GREGORY S. SCHULTZ 

### MICHAEL RUBIN . Special Assistant Attorneys General Rhode Island Deparent of the Attorney General 150 South Main Street Providence, Rhode Island 02903 Counsel for State of Rhode Island
THEAJ. SCHWARTZ Assistant Attorney General Environmental Division Offce of the Attorney General 109 State Street Montpelier, VT 05609-100 i

Counsel for State of Vermont

LESLIE R. SEPFERN Assistant Attorney General Offce of the Attorney General P.O. Box 40117 Olympia, Washington 98504

Counsel for State of WashingtonDATE: 

### PAUL S. LOGAN Assistant Attorney General 

### Deparment of Justice 1162 Cour Street, N.E. Salem, Oregon 97301 Counsel for State of. Oregon DA TE:-l t~ I '2c"iO 

# G OR . C MICHAEL R IN Special Assistant Attorneys General Rhode Island Deparent ofthe Attorney General 150 South Main Street 

### Providence, Rhode Island 02903 

### Counsel for State of Rhode Island
DATE: 

### THEA J. SCHWARTZ Assistant Attorney General 

### Environmental Division Office of the Attorney General 109 State Street Montpelier, VT 05609-1001 Counsel for State of Vermont
DATE: 

### LESLIE R. SEFFERN 

### Assistant Attorney General Office of the Attorney General P.O. Box 40117 

### Olympia, Washington 98504

Counselfor State of Washington

Page 9 of 12DATE:

DATE: PAUL S. LOGAN Assistant Attorney General Department of Justice 1162 Court Street, N .E. Salem, Oregon 9730 I 

### Counsel/Ór State o/Ore!?on

-_. _. _..-- _. .._--. - - . - . 

### GREGOR Y S. SCHULlZ MICHAEL RUBIN Special Assistant Attorneys General Rhode Island Department of the Attorney General 

## 150 South Main Street . Providence. Rhode Island 02903 Counsel/Ór ,,,'tate (~/Rhode Is/and 

# -1L ~. ~i- - THEAJ. SCH 1\RT ~ Assistant Attorney General Environmental Division Of1ce of the Attorney General 109 State Strect Montpelier. VT 05609-1001 DATE: \ i- / 10 lio 

# , I

DATE:

Page 9 of i i Counsel/Ór State 0/ Vermont 

# . .

LESLIE R. SEFFERN Assistant Attorney General Ofice of the Attorney (Jenera1 P.O. Box 40117 

### Olympia, Washington 98504 Counselfor State of WashingtonDATE: PAUL S. LOGAN 

### Assistant Attorney General 

### Deparment of Justice 1162 Cour Street, N .E. 

### Salem, Oregon 97301 ."

Counselfor State of 

### Oregon DATE: 

### GREGORY S. SCHULTZ MICHAEL RUBIN 

### Special Assistant Attorneys General Rhode Island Deparment of 

### the Attorney General 150 South Main Street Providence, Rhode Island 02903 

### Counsel for State of Rhode Island
DATE: 

### THEA J. SCHWARTZ Assistant Attorney General 

### Environmental Division Office of the Attorney General 109 State Street Montpelier, VT 05609-1001 Counsel for State of Vermont 

### DATE: / ;i.- /J' - /tJ 

# ~ ~~/'

/ ß~~\ - ZLifu R. SEFFERN . -- Assistant Attorney General Offce of 

### the Attorney General P.O. Box 40117 

### Olympia, Washington 98504

Counsel for State of Washington

Page 9 of 11

# DATE~~,/¿?,./d ~ 5~_~~

. .. '/ ONNAM.MU Y Deputy Solicitor General . Offce ofthe D.C. Attrney General . 441 Four Stret. N.W. Wasgton, D.C. 2001)1 i i 1 I t Counsel for District of Columbia
DATE: 

### WILLIA L. PAREE Assistt Attorney Genera Envionmenta Protection Division One Ashburn Plac Boston, Massahusetts 02108 Counsel for Commonwealth of Massachusetts
DATE: 

### CHRSTOPHER G. KIG New York City Law Deparent 100 Churh Slleet New York, NY 10007
Counselfor City of New York \ iDATE:



## DATE:'Yu '9,,2010

:QA'r;

Page 10 of 11 

### DONNA M. MUSKY Deputy Solicitor General Office' ofthe D.C. Attorney General 44.1 Fourh S1reet, N. W. Washington, D..c.. 2aQQ1 Çtmn~s,1 jQr Pi~triP f)f Çç!lymki(l 

## GJ,ml~~ (.,'~,~ WILLIA L. ~AREE CAROL IACU As.sistant Attorneys General EnvIromnentai Protection Ðivisíon Offce of the Attorney Generål . Une Ashburon Place Baston, Massachusett Q21Q8 Caunïfe.l far Cammanwei¡lth of Mas.s.aahufJtHts.


### CHRSTOPHER G. KIG 

### CARll NOTEBOOM New York City Law Deparent 100 Church Street l'ew York, NY 10007 , Counsel for City of New. YorkDATE: 

### DONNA M. MURASKY Deputy Solicitor General Office of 

### the D.C. Attorney General 441 Fourth Street, N.W. Washington, D.C. 20001

Counselfor District of Columbia
DATE: 

### WILLIAM L. PARDEE CAROL IANCU 

### Assistant Attorneys General 

### Environmental Protection Division 

### Offce of the Attorney General One Ashburton Place 

### Boston, Massachusetts 02108

DATE:lJ.. /0- /D 

### or Commonwealth of Massachusetts

Counselfor City of New York

Page 10 of 11

### DATE: 12/16/2010

DATE: 12/16/2010



### DATE: 12/20/2010

Page 11 of 11 í \ 

## I I ;j \,l ! 'Kl.í fV tit..vA 

## () ~

l/tlvl.t-1Ø1 

# o DAVID D. DONIGER Natural Resources Defense Council 1200 New York Avenue NW, Suite 400 Washington, DC 20005 

### Counsel for Natural Resources Defense Council 

### /..;;;?~Il (.....-...... 

# /~;/. -''). /7'/ r.,.;,ii!:.._ .....;':l"., -- ..t;_~".._ .r" ".--..... / ...~...."'___,::: 

# /' JOANNE SPALDING Sierra Club 

### 85 Second Street 

### San Francisco, CA 94105 Counsel for Sierra Club 

# tJ~ ?~-/1J kJ~(/ VICKIE PATTON 

### Environmental Defense Fund 2334 N. Broadway 

### Boulder, CO 80304 Counsel for Environmental Defense Fund