MEMORANDUM: From Chloe Kolman, Attorney

TO: Section 111 (b) Docket

RE: EPAct05

DATE: July 29, 2015

MEMORANDUM

Pursuant to its authority under section 111(b) of the Clean Air Act, 42 U.S.C. § 7411(b), the EPA 

proposed carbon pollution standards for new power plants on September 20, 2013.

1 When establishing

new source performance standards for a source category, the EPA sets the standard based on what it 

determines to be the “best system of emission reduction,” or BSER, that is “adequately demonstrated”

(also taking into account additional factors enumerated in section 111). The EPA’s determination of the 

BSER for new sources is based in part on an assessment of technology in use or in development within 

the industry, including at pilot and demonstration projects, but need not be limited to technology that is in 

“actual routine use.” In establishing standards for new plants, the EPA may also consider the technology 

that “may fairly be projected for the regulated future.”2

In 2005, Congress passed the Energy and Policy Act of 2005, or EPAct05,3 which included three similar 

provisions bearing on the EPA’s execution of its rulemaking powers under section 111 and two other 

sections of the Clean Air Act. These provisions, found in EPAct05 sections 402(i), 421(a), and 1307(b) 

(adding 26 U.S.C. § 48A(g) to the Internal Revenue Code),4bound the EPA’s ability to consider

information from facilities receiving assistance under EPAct05 when assessing whether a particular 

technology, or emission reduction, has been “adequately demonstrated.” In the 111(b) proposed rule for 

new power plants, the EPA proposed that the BSER for fossil-fuel fired steam EGUs requires the partial 

implementation of carbon capture and storage (“CCS”). Since 2005, a number of projects employing 

CCS, or components of CCS, have received support under EPAct05. Consequently, in assessing the 

evidence for its determination of the BSER, the EPA has been compelled to interpret the scope of the 

limitation in the three EPAct05 provisions. As these provisions relate to grant programs and a tax credit 

administered by the Department of Energy and the Internal Revenue Service, the EPA solicits your views 

on the EPA’s interpretation of this language.

Interpretation of Sections 402(i) and 421(a) of EPAct05, and of Section 48A(g) of the IRC

In considering sections 402(i), 421(a), and 48A(g), the EPA has concluded that each of the three 

provisions prevents the EPA, in determining the BSER, from finding that a technology or emission limit 

is adequately demonstrated based exclusively on evidence from facilities supported under EPAct05. 

However, the EPA interprets all three provisions to allow the EPA to consider and rely upon information 

from EPAct05-supported facilities in combination with information from other facilities.5 The EPA’s 

interpretation is based on the plain language of the three provisions and Congressional intent that 

EPAct05 support the advancement and commercialization of CCS technology.

 

1 The proposed rule was published in the Federal Register on January 8, 2014. 79 Fed. Reg. 1430.

2

See Portland Cement Ass’n v. Ruckelshaus, 486 F.2d 375, 391 (D.C. Cir. 1973).

3

Pub. L. 109-58 (Aug. 8, 2005).

4

See 42 U.S.C. §§ 15962(i), § 13573(e); 26 U.S.C. § 48A(g).

5 EPA solicited comment on this interpretation in its Notice of Data Availability and accompanying 

Technical Support Document, published in the Federal Register on February 26, 2014. 79 Fed. Reg. 

10750.
A. Sections 402(i) and 421(a)

Sections 402 and 421 of EPAct05 establish two Department of Energy grant programs for projects

advancing clean coal technologies—the Clean Coal Power Initiative (“CCPI”) and the Clean Air Coal 

Program (“CACP”). The language of the two limiting provisions bearing on the EPA’s consideration of 

projects receiving CCPI or CACP assistance, found in sections 402(i) and 421(a) respectively, is nearly 

identical.

Section 402(i) reads:

No technology, or level of emission reduction, solely by reason of the use of the technology, or the 

achievement of the emission reduction, by 1 or more facilities receiving assistance under this Act, shall be 

considered to be—(1) adequately demonstrated for purposes of section 7411 of this title; (2) achievable 

for purposes of section 7479 of this title; or (3) achievable in practice for purposes of section 7501 of this 

title.

42 U.S.C. § 15962(i).

Section 421(a) reads:

No technology, or level of emission reduction, shall be treated as adequately demonstrated for purpose 

[sic] of section 7411 of this title, achievable for purposes of section 7479 of this title, or achievable in 

practice for purposes of section 7501 of this title solely by reason of the use of such technology, or the 

achievement of such emission reduction, by one or more facilities receiving assistance under section 

13572(a)(1) of this title.

42 U.S.C. § 13573(e). The EPA believes the meaning of these two provisions, particularly when read 

together, is plain: no technology, or level of emission reduction, can be deemed to be adequately 

demonstrated where the exclusive—sole—basis for that conclusion is the evidence provided by EPAct05-

supported facilities. These provision thus limit the EPA from making a BSER determination where the 

only available evidence comes from the technology’s use (or the emission reduction’s achievement) at 

EPAct05 facilities. However, the limitation does not prevent the EPA from relying on information from 

EPAct05 facilities as part of a broader array of support that also includes information from non-EPAct05 

facilities; in that case, the EPAct05 information would not be the “sole” basis for the EPA’s conclusion.

EPA received several public comments disputing this interpretation. Some commenters suggest that the 

EPA misreads the relevance of the phrase “solely by reason of,” which should be read as a narrow 

qualification on the “level of emission reduction.” Other commenters agree with the EPA’s parsing of the 

two provisions’ clauses, but read the provisions to mean that the EPA may reference information from 

EPAct05 facilities but may not rely on that information where the EPA could not reach the same

determination without it. Still others suggest that the EPA cannot consider EPAct05 facility information 

at all. Considering the grammar and syntax of sections 402(i) and 421(a), the EPA believes these 

commenters are incorrect.

1. What does the clause beginning “solely by reason of” refer to?

No technology, or level of emission reduction, solely by reason of the use of the 

technology, or the achievement of the emission reduction, by 1 or more facilities 

receiving assistance under this Act, shall be considered to be—(1) adequately 

demonstrated for purposes of section 7411 of this title . . . (Section 402(i).)
EPA reads the language “solely by reason of the use of the technology, or the achievement of the emission 

reduction,” which appears in both provisions, as a single clause that informs the evidentiary basis for the

EPA’s determination: the EPA may make a determination based on a technology or level of emission 

reduction at EPAct05 facilities, so long as the determination is not “solely by reason of” the use or 

achievement demonstrated at those facilities. However, some commenters believe this language should 

not be read as a single clause. Looking only at section 402(i), these commenters suggest that the language

should be split so that “solely” only modifies the phrase “level of emission reduction,” while “the 

achievement of the emission reduction” becomes an additional list item like “technology” or “level of 

emission reduction.” These commenters would read section 402(i) to establish three categories that the 

EPA cannot consider to be adequately demonstrated based on information from EPAct05 facilities: (1) 

“technology”; (2) “level of emission reduction, solely by reason of the use of the technology”; and (3) “the 

achievement of the emission reduction.”

This interpretation is contrary to the plain language of these provisions. The whole clause “solely by 

reason of the use of the technology, or the achievement of the emission reduction”

6

appears in both 

sections 402(i) and 421(a). In section 402(i), it follows directly after “no technology, or level of emission 

reduction”—giving rise to commenters’ suggested interpretation:

No technology, or level of emission reduction, solely by reason of the use of the 

technology, or the achievement of the emission reduction . . . shall be considered to be []

adequately demonstrated . . .

But in section 421(a), the clauses are rearranged and “solely by reason of” appears after the enumeration 

of the three Clean Air Act sections:

No technology, or level of emission reduction, shall be treated as adequately 

demonstrated . . . solely by reason of the use of such technology, or the achievement of 

such emission reduction . . .

In section 421(a), it is impossible to regroup the language so that “solely” only modifies “level of 

emission reduction,” which appears much earlier in the provision.7

Even ignoring the clear structure of section 421(a), the grammar and syntax of 402(i) alone cannot 

support the commenters’ reading. Unlike “technology” and “level of emission reduction,” which lack 

articles, “the achievement of the emission reduction” begins with an article, “the.” If commenters were 

correct that “the achievement of the emission reduction” should be read as a third category that the EPA is 

barred from considering, the statute would read “No technology, or [no] level of emission reduction, . . . 

or [no] the achievement of the emission reduction . . . shall be considered to be [] adequately 

demonstrated . . . .” This reading is unsound. By contrast, the EPA’s reading maintains the coherence of 

the provision by creating two parallel clauses: 

 

6

Section 421(a) replaces “the technology” and “the emission reduction” with “such technology” and 

“such emission reduction.” Otherwise the language is identical.

7 Commenters ignore this feature of section 421(a) and instead compare section 402(i) to the sentence 

structure of section 48A(g), which puts “or level of emission reduction solely by reason of the use of the 

technology” in parentheses, as noted infra. While EPA acknowledges that the use of “solely” has a 

different effect in section 48A(g), commenters’ reading of “solely” in that provision cannot be imported 

to sections 402(i) and 421(a) because it is precluded by the use of the articles in section 402(i), described 

infra, and is plainly contrary to the clause structure of 421(a). Accordingly, commenters’ observations 

about section 48A(g) on this point do not override the plain meaning of these two provisions.
Clause 1: “No [(A)] technology, or [(B)] level of emission reduction,” 

Clause 2: “solely by reason of [(A)] the use of the technology, or [(B)] the achievement of the 

emission reduction . . .”

With this reading, the EPA gives effect to all of the language in section 402(i).

2. What is the scope of the limitation created by the term “solely”?

No technology, or level of emission reduction, solely by reason of the use of the 

technology, or the achievement of the emission reduction, by 1 or more facilities 

receiving assistance under this Act, shall be considered to be—(1) adequately 

demonstrated for purposes of section 7411 of this title . . . (Section 402(i).)

EPA believes the meaning of the term “solely” in sections 402(i) and 421(a) is clear. The dictionary 

defines “solely” as “involving nothing except the person or thing mentioned”; its synonyms include 

“only” and “exclusively.”

8 Accordingly, the EPA believes that it may rely on information from EPAct05 

facilities so long as this information is not the only support for its determination. The EPA does not 

believe that the use of “solely” here can be read to imply a “but for” test as commenters suggest, whereby 

the EPA could not use EPAct05 facility information in any circumstance where, “but for” that 

information, it would not have made the same determination. The EPA believes that commenters have 

confused a “necessary” cause (the EPA’s determination would fail “but for” the EPAct05 information) 

with a “sufficient” cause (the EPAct05 information is the “sole” basis for the EPA’s determination). For 

example, the assent of each Supreme Court Justice in the majority may be necessary to a Court’s 5-4

decision (a “but for” cause), but the assent of a single Justice in the majority is not sufficient for the 

outcome (the “sole” basis). For that reason, the EPA interprets sections 402(i) and 421(a) to allow it to 

rely on information from EPAct05 facilities even where that information is a necessary component of its 

determination, so long as the information from these facilities is not the sole support for the 

determination. 

3. Is EPA barred from all consideration of EPAct05 facilities?

No technology, or level of emission reduction, solely by reason of the use of the 

technology, or the achievement of the emission reduction, by 1 or more facilities 

receiving assistance under this Act, shall be considered to be—(1) adequately 

demonstrated for purposes of section 7411 of this title . . . (Section 402(i).)

The EPA does not agree that it is barred from all consideration of EPAct05 facilities because section 

402(i) specifies that no technology or emission reduction “shall be considered to be [] adequately 

demonstrated” on the basis of EPAct05 information. Commenters attempt to read “shall be considered” as 

barring all “consideration,” but this confuses two meanings of the verb “to consider.” Here, the use of the 

phrase “considered to be [] adequately demonstrated” makes clear that the language means “shall be 

deemed to be” or “shall be adjudged to be.” The provision does not use “consider” in the sense of “think 

about” or “contemplate.”9 The EPA’s interpretation is supported by the text of section 421(a), where 

 

8

See MacMillan English Dictionary online, 

http://www.macmillandictionary.com/dictionary/american/solely.

9

See MacMillan English Dictionary online, 

http://www.macmillandictionary.com/dictionary/american/consider (definition includes both “to think 
Congress instead used the phrase “shall be treated as [] adequately demonstrated.” Both sections 402(i) 

and 421(a) can thus be read naturally to mean that the EPA shall not “deem” these technologies to be 

adequately demonstrated on the basis of EPAct05 facilities, but neither provision can be read to prohibit 

the EPA from “thinking about” these facilities.

B. Section 48A(g)

A similar, but more varied limitation appears in section 1307(b) of EPAct05, as codified at 26 U.S.C. § 

48A(g). Unlike sections 402(i) and 421(a), which concern DOE grant programs, this provision concerns

tax incentives for facilities that employ clean coal technology. However, section 48A(g) includes some of 

the same language that appears in the two DOE grant provisions. It reads:

No use of technology (or level of emission reduction solely by reason of the use of the technology), and no 

achievement of any emission reduction by the demonstration of any technology or performance level, by 

or at one or more facilities with respect to which a credit is allowed under this section, shall be 

considered to indicate that the technology or performance level is—(1) adequately demonstrated for 

purposes of section 111 of the Clean Air Act (42 U.S.C. 7411); (2) achievable for purposes of section 169 

of that Act (42 U.S.C. 7479); or achievable in practice for purposes of section 171 of such Act (42 U.S.C. 

7501).

26 U.S.C. § 48A(g). Although this provision has some notable differences from sections 402(i) and 

421(a), the EPA believes that it creates a similar limitation. The EPA acknowledges that the addition of 

parentheses changes the meaning of the phrase “solely” in section 48A(g) (a deviation that, the EPA 

notes, accompanies several other small deviations in the language of section 48A(g) as compared to 

sections 402(i) and 421(a)). However, the remaining language prescribes that the demonstration of a 

technology or performance level at an EPAct05-supported facility cannot “be considered to indicate that 

the technology or performance level is [] adequately demonstrated.” This phrase is best interpreted to 

mean that the EPA shall not deem a technology or emission level to be adequately demonstrated based

exclusively on information from EPAct05 facilities. 

As in section 402(i), the use of the verb “to consider” in section 48A(g) plainly means “to deem” or “to 

adjudge” rather than “to think about” or “to contemplate.” Comparing the two possibilities, only the first 

definition (“to deem”) is intelligible in context:

(1) “No use of technology . . . shall be [deemed] to indicate that the technology . . . is adequately 

demonstrated . . .”

(2) “No use of technology . . . shall be [contemplated] to indicate that the technology . . . is 

adequately demonstrated . . .”

Meanwhile, the verb “to indicate (that)” is defined as meaning “to show that something will happen, is 

true, or exists,” as in the sentence, “A survey indicated that 89 percent of people recycle paper.”10 Under 

this definition, synonyms include “to show” or “to prove.” Accordingly, the limitation that “[n]o use of 

technology . . . by or at one or more [EPAct05-supported facilities] . . . shall be considered to indicate 

that the technology . . . is [] adequately demonstrated” prevents the EPA from concluding that the use of 

a technology at an EPAct05 facility can be deemed to prove that the technology is adequately 

 

about something carefully before making a decision of developing an opinion” and, when used with “to 

be,” “to have a particular opinion about someone or something”).

10 See MacMillan English Dictionary online, 

http://www.macmillandictionary.com/dictionary/american/indicate.
demonstrated. This limitation thus prevents the EPA from making a BSER determination on EPAct05 

evidence alone (which would require that the EPA believe the EPAct05 evidence, in itself, could be 

deemed to prove the EPA’s conclusion), but does not prevent the EPA from relying on that evidence in 

tandem with information from non-EPAct05 facilities (where the EPAct05 information would not prove, 

but only support, the EPA’s conclusion). Section 48A(g) thus establishes a “sole basis” limitation, like 

that in sections 402(i) and 421(a), even where the broader language of the provision deviates from the 

construction in the other two sections.11

While it is not necessary to conclude that section 48A(g), concerning IRS tax credits, be read to create 

similar limitation to those appearing in sections 402(i) and 421(a), concerning DOE grant programs, the 

EPA believes the natural reading of all three provisions warrants this outcome, as does the broader 

purpose of the subsidies established in these sections. Congress intended these programs to advance the 

development of clean coal technologies, and to serve as a bridge to their commercialization. Although 

Congress set reasonable limitations to ensure that EPAct05-supported facilities did not form the exclusive 

basis for technological determinations under the Clean Air Act before such technology appeared 

elsewhere in the industry, it would be contrary to the intent of the legislation to preclude the EPA from 

recognizing advances in CCS technology when projecting the future availability of clean coal 

technologies for new sources. Allowing the EPA to rely on information from these demonstration 

projects, provided the EPA can show—with other evidence—that these technologies are beginning to take 

root in the broader market, is most consistent with Congressional intent and with the plain language of 

these provisions.

 

11 Although in its proposed rule the EPA took comment on several other aspects of the limitation in 

section 48A(g)—for example, when a tax credit under section 48A(g) is “allowed” for purposes of 

triggering the limitation—the EPA is not finalizing any further interpretations at this time, as none is 

relevant to the particular facilities EPA has relied upon in reaching its determination.