A federal appeals court granted the U.S. Environmental Protection Agency's request for more time to reconsider a rulemaking that extended the lives of unlined coal ash ponds, accepting utilities' assertions that vacating the extension would threaten the reliability of the nation's electric grid.

In doing so, a three-judge panel for the U.S. Court of Appeals for the District of Columbia Circuit denied a request from environmental groups to stay or vacate the EPA's move to let unlined coal ash ponds continue operating until October 2020.

The legal challenge revolves around the EPA's 2015 Coal Combustion Residuals, or CCR, rule, which set the first-ever national standards for the safe handling and storage of ash and other residuals generated from burning coal for electricity.

Under that rule, wet surface impoundments known as ash ponds were required to demonstrate compliance by Oct. 17, 2018. Among its many provisions, the CCR rule specifically prohibited certain levels of toxic coal ash constituents in groundwater and required ash ponds to be located at least five feet from the uppermost aquifer. Ponds that violated those provisions were required to initiate closure within six months — or as early as April 2019.

In July 2018, however, the Trump administration extended the closure deadline to October 31, 2020, to give utilities more time to develop alternative coal ash disposal capacity.

The issue gained complexity in August 2018 when the D.C. Circuit, citing public health and environmental concerns, struck down a provision of the Obama-era CCR rule that allowed unlined ponds to continue operating unless a leak was detected. The ruling effectively required all unlined ash ponds to close, but the court did not set a deadline for those closures.

Environmental groups, led by the Waterkeeper Alliance, challenged the EPA's deadline extension the following October, arguing that the move was inconsistent with the D.C. Circuit's opinion that all unlined ash ponds should cease operating. The groups also alleged that the extension was unlawful because it was issued without prior notice and without giving the public an opportunity to comment.

Meanwhile, the EPA asked the court to remand its July 2018 rulemaking for further consideration and allow it to finalize further revisions consistent with the D.C. Circuit's August 2018 decision.

In December 2018, environmental petitioners moved to stay or partially vacate the deadline extension, arguing that their members would be "irreparably harmed" by allowing unlined ash ponds to continue receiving coal residuals. In response, the Utilities Solid Waste Activities Group, a trade organization that represents companies with significant amounts of coal-fired generation, argued in a Jan. 22 filing that doing so "would cause regulatory uncertainty and significant disruption to the nation's power supply."

The EPA echoed the group's warning in its own Jan. 29 filing, arguing that unlined coal ash ponds would be required to initiate closure immediately if the July 2018 rulemaking were set aside. Environmental groups, meanwhile, contended that the EPA's own submissions to the court indicate that alternative disposal arrangements are readily available.

The D.C. Circuit on March 13 sided with the EPA after considering both arguments, finding that the agency and industry intervenors demonstrated that "the consequences of vacatur would be disruptive." In its motion for remand, the EPA estimated that it could conclude a notice-and-comment rulemaking to revise its July 2018 changes to the CCR rule "no sooner than nine months from the date that remand is granted."

The D.C. Circuit case is Waterkeeper Alliance et al. v. EPA et al. (No. 18-1289).