Mexichem Specialty Resins, Inc. v. Environmental Protection Agency

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 19, 2014 Decided May 29, 2015

No. 12-1260

MEXICHEM SPECIALTY RESINS, INC.,

PETITIONER

v.

ENVIRONMENTAL PROTECTION AGENCY AND GINA

MCCARTHY,

RESPONDENTS

AIR ALLIANCE HOUSTON, ET AL.,

INTERVENORS

Consolidated with 12-1265, 12-1266, 12-1267

On Petitions for Review of Final Actions

of the United States Environmental Protection Agency

Douglas J. Behr and Jean-Cyril Walker argued the causes

for Industry Petitioners. With them on the briefs were David

M. Friedland, Kristen H. Gladd, Marc D. Machlin, and

Christopher D. Jensen. Eric P. Gotting and Peter L. de la

Cruz entered appearances.

Angeline Purdy, Attorney, U.S. Department of Justice,

argued the cause for respondent. With her on the brief were

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Sam Hirsch, Acting Assistant Attorney General, and Mark

Kataoka, Counsel, U.S. Environmental Protection Agency.

Emma C. Cheuse argued the cause for respondent-

intervenors. With her on the brief was James S. Pew.

Before: ROGERS, KAVANAUGH and PILLARD, Circuit

Judges.

Opinion for the Court filed by Circuit Judge PILLARD.

Opinion dissenting in part filed by Circuit Judge

KAVANAUGH.

PILLARD, Circuit Judge: This case concerns the

production of polyvinyl chloride (PVC), one of the world’s

most common and versatile plastics, used in everything from

water pipes to credit cards. As is true of the making of so

many good things, however, the less one knows, the better

one sleeps. PVC production results in the emission of more

than a dozen known or suspected carcinogens and other

hazardous air pollutants, a miasma that includes the known

carcinogens 1,3-butadiene, benzene, and vinyl chloride. See

Proposed PVC Rule, 76 Fed. Reg. 29,528, 29,532 (May 20,

2011). Congress has charged the Environmental Protection

Agency with the difficult task of protecting the health of the

American public by ensuring that industry reduce to the

greatest extent it can emissions into the atmosphere of

carcinogens and similarly dangerous chemicals.

In 2012, EPA promulgated a Rule setting first-time-ever

limits on the emission of most hazardous air pollutants from

PVC production. Petitioners, PVC manufacturers, challenge

the Rule. They contend that many of the Rule’s emissions

limits should be vacated on the grounds that EPA did not

3

follow required rulemaking procedures, used faulty data in

setting some of the limits, and poorly designed certain aspects

of the regulation. They also ask the court to set aside some of

the Rule’s monitoring and compliance requirements.

Petitioners raised many of these objections for the first time in

petitions for reconsideration with EPA that are awaiting

resolution. The Clean Air Act therefore precludes the court

from reviewing them now, and we decline Petitioners’ request

that we stay EPA’s Rule pending the agency’s completion of

its reconsideration. As to those challenges to the Rule that are

ready for our review, we hold that EPA acted reasonably and

in accordance with the Clean Air Act. We therefore deny the

petitions.

I.

The Clean Air Act requires EPA to promulgate

regulations limiting the emission of hazardous air pollutants

from “major sources” and “area sources.”

42 U.S.C. § 7412(d)(1). Those pollutants are specified on a

list of hazardous air pollutants Congress established in 1990

in an amendment to the Act.1 42 U.S.C. § 7412(b)(1); see

Nat’l Lime Ass’n v. EPA, 233 F.3d 625, 628-29, 633-34 (D.C.

Cir. 2000). For listed pollutants, EPA must set emissions

standards in two steps: First EPA sets a baseline, or “MACT

floor,” derived from data about the cleanest-performing

similar sources already in the market; and, second, EPA

investigates methods that may not already be in use to discern

1

The difference between major sources and area sources is size: A

“major source” is a stationary source that has the potential to emit

10 tons per year of any single hazardous air pollutant or 25 tons per

year of any combination of hazardous air pollutants,

42 U.S.C. § 7412(a)(1); any smaller stationary source is an “area

source,” id. § 7412(a)(2).

4

whether even more stringent, “beyond-the-floor” standards

are achievable to further reduce emissions.2 See

42 U.S.C. §§ 7412(d)(2), (d)(3); Nat’l Lime, 233 F.3d at 629,

634.

The Rule under review establishes limits on hazardous air

pollutant emissions from major and area sources at various

points in the PVC production process. See PVC Rule, 77 Fed.

Reg. 22,848, 22,851-55 (Apr. 17, 2012); id. at 22,857-59

(summarizing major source emissions standards); id. at

22,862-63 (summarizing area source emissions standards).

The Rule limits the concentration of hazardous air pollutants

that may remain in PVC resins (the “stripped resins” limits),

the concentration of hazardous air pollutants that can be

present in exhaust vented into the atmosphere (the “process

vent” limits), and the concentration of hazardous air

pollutants that may be dissolved in wastewater (the “process

wastewater” limits). Proposed PVC Rule, 76 Fed. Reg. at

29,531-35; see also 40 C.F.R. § 63.12005. The Rule also

requires the installation of monitoring equipment and the

implementation of testing policies and workplace practices,

all of which are designed to ensure initial and continuous

compliance with EPA’s emissions limits. See PVC Rule, 77

Fed. Reg. at 22,859-62 (summarizing compliance

requirements).

The Rule stems from Congress’s 1990 amendments to the

Clean Air Act. In those amendments, Congress (1) mandated

that EPA regulate over one hundred specified hazardous air

2

“MACT” is short for “Maximum Achievable Control

Technology.” Nat’l Lime, 233 F.3d at 630. MACT floors are

“floors” because they represent the least stringent emissions limits

EPA may impose, “even though they in fact establish maximum

emission levels” for manufacturers. Id. at 629.

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pollutants, Nat’l Lime, 233 F.3d at 633, and (2) required EPA

to review within ten years of the Act’s amendment all of its

preexisting emissions standards to ensure that they cover

listed pollutants. 42 U.S.C. § 7412(q)(1); see Mossville Envtl.

Action Now v. EPA, 370 F.3d 1232, 1236-37 (D.C. Cir. 2004).

As of 1990, EPA already had a longstanding regulation

limiting the emission of vinyl chloride, one of the hazardous

air pollutants from PVC sources. 41 Fed. Reg. 46,560 (Oct.

21, 1976). Congress’s amendments required EPA to revisit

its pre-1990 vinyl chloride emissions standard and expand it

to regulate all the newly listed hazardous air pollutants from

PVC sources.

EPA got part of the way there. It promulgated a rule in

1992, the “HON Rule,” that regulated emissions from the

production of ethylene dichloride and vinyl chloride

monomer, two inputs to PVC production.3 Mossville, 370

F.3d at 1237. The HON Rule did not, however, regulate

emissions arising from the production of PVC itself. Id.

Because the HON Rule did not cover PVC production, EPA

still needed to undertake another rulemaking to comply with

Congress’s mandate that it revisit and expand its earlier vinyl

chloride regulation. Id. That second Rule is at issue here.

EPA began development in 1998 of a version of the Rule

that it promulgated in 2002. See 67 Fed. Reg. 45,886, 45,889

(July 10, 2002). In that Rule, EPA readopted its pre-1990

limits for vinyl chloride emissions from PVC production,

determining that those limits were a good estimate of the

MACT floors for vinyl chloride. Mossville, 370 F.3d at 1237.

In a challenge to the 2002 rule’s lawfulness and rationality

3

“HON” is short for “Hazardous Organic NESHAP.” See

Mossville, 370 F.3d at 1237. “NESHAP” is short for “National

Emission Standards for Hazardous Air Pollutants.” Id. at 1235.

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under the Clean Air Act, we sustained EPA’s judgment. Id. at

1234, 1237, 1242. We found the Rule flawed in part,

however, for its failure to set limits on all of the remaining

hazardous air pollutants the Act requires EPA to regulate. Id.

at 1242-43. EPA argued that the same technologies that

remove vinyl chloride from PVC emissions—“stripping,

scrubbing, incineration”—reduce the emission of all

hazardous air pollutants to a similar degree and that the

emissions limit for vinyl chloride therefore could stand in as a

“surrogate” for setting individual limits on the emission of

other hazardous air pollutants. Id. at 1237. We found EPA’s

judgment on that point unsupported by the record and vacated

and remanded the Rule for further explanation and

reconsideration, as appropriate. Id. at 1243.

In 2009, EPA began issuing information requests to PVC

manufacturers and otherwise gathering the data necessary to

set MACT floors for non-vinyl chloride hazardous air

pollutants from PVC production. EPA issued a proposed rule

in 2011 and accepted comments for a period of two and a half

months. See Proposed PVC Rule, 76 Fed. Reg. at 29,528; 76

Fed. Reg. 42,613 (July 19, 2011). After the close of the

public comment period, PVC manufacturers continued to

submit data to EPA, including data the manufacturers

recorded from sampling and testing independently of what

EPA’s data requests required. In response to some of that

new information, submitted after the comment period closed,

EPA revised its Rule. EPA promulgated the Rule in April

2012. See PVC Rule, 77 Fed. Reg. 22,848. Industry

Petitioners promptly petitioned EPA for reconsideration and

sought judicial review, arguing that EPA had given

Petitioners inadequate notice and opportunity to comment on

EPA’s post comment period revisions. EPA granted

reconsideration on several of Petitioners’ claims.

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II.

Petitioners challenge three aspects of EPA’s Rule. First,

Petitioners challenge the Rule’s limit on the concentration of

organic hazardous air pollutants in process wastewater from

existing major sources. Petitioners argue that EPA

established that limit without providing adequate notice or

opportunity to comment. They also argue that the limit is not

a logical outgrowth of the proposed rule and that EPA based

the limit on data that was incorrect and incomplete.4

4

On the eve of oral argument, EPA and Petitioners reached a

settlement on EPA’s Rule setting wastewater limits for area

sources. They filed a joint unopposed motion to sever their

challenge to that Rule and hold it in abeyance, which this court

granted. See Mexichem Specialty Resins, Inc. v. EPA, No. 12-1260

(D.C. Cir. Dec. 17, 2014) (order granting joint unopposed motion to

sever and hold in abeyance the challenge to the area source

wastewater limit). The same emissions limit that governs

wastewater from area sources also governs new major sources.

That limit was based on a single data point that EPA acknowledges

to be erroneous. See Resp. Br. 21, 35; PVC Rule, 77 Fed. Reg. at

22,854, 22,863. Neither EPA nor Intervenors oppose vacatur of

that emissions limit. See Resp. Br. 35-36; Int. Br. 20, 33. The

parties did not, however, move to sever and hold in abeyance the

new major source wastewater emissions limit when they made their

motion with respect to the area source emissions limit.

The court, however, is barred from vacating or staying the new

major source wastewater limit. Petitioners failed to preserve their

challenges to the wastewater emissions limits, including the new

major source wastewater limit, and EPA did not waive its

exhaustion defense. Petitioners were therefore required to show

irreparable harm from the existence of the new major source

wastewater limit to obtain a right to a stay or vacatur. Petitioners

8

Second, Petitioners challenge the Rule’s limits on

hazardous air pollutants emitted through process vents.

EPA’s proposed rule set limits applicable to all PVC process

vents. During the rulemaking, however, PVC manufacturers

notified EPA that some PVC manufacturers also discharge

exhaust generated by other (non-PVC) processes through

PVC process vents. See PVC Rule, 77 Fed. Reg. at 22,851.

In response, EPA created a hybrid category in the final

Rule—“PVC-combined” process vents—setting distinct

emissions limits for process vents that comingle fumes from

PVC and non-PVC sources. 40 C.F.R. § 63.12005; see PVC

Rule, 77 Fed. Reg. at 22,865, 22,869. Petitioners raise a spate

of objections to EPA’s process vent limits and its decision to

create the separate PVC-combined process vent category.

They argue that EPA established the PVC-combined process

vent limits without providing adequate notice or opportunity

to comment. Petitioners claim they were denied an

opportunity to provide EPA with supplemental data they

believe is necessary to develop accurate PVC-combined

process vent limits. Petitioners also maintain that the PVC-

combined process vent emissions limits as applied to non-

PVC source emissions when they discharge through a

common vent with PVC source emissions unlawfully conflict

with the limits that already apply to the non-PVC sources.

have not, however, alleged or shown any harm arising from the

existence of the limit. Indeed, the record contains no evidence that

Petitioners have any plans to build new major sources. The Clean

Air Act therefore prevents the court from staying or vacating the

new major source wastewater limit.

Because the limits for area sources have been severed and the

limits for new major sources are not properly before us, we limit

our discussion in the text to the challenge to the existing major

source limits.

9

Petitioners further contend that EPA’s Rule irrationally fails

to subcategorize process vents on the basis of their emissions

control technology.

Third and finally, Petitioners challenge some of the

Rule’s continuous compliance and monitoring provisions.

They argue that EPA’s regulations governing when

manufacturers may open “bypasses” and mandating the

installation of monitoring equipment on “pressure relief

devices” are arbitrary and capricious.5 Petitioners also

contend that regulations requiring that all bypasses be

equipped with devices that detect when they are opened are

“beyond-the-floor” MACT requirements that EPA unlawfully

imposed without engaging in cost-benefit analysis as required

by the Clean Air Act.

We deny the petitions. Petitioners did not raise

procedural or merits objections to the wastewater limit during

the notice and comment period. Petitioners also did not raise

procedural objections to the PVC-combined process limit

during the notice and comment period or challenge the

5

Bypasses, as their names suggest, allow fumes to bypass

emissions controls and discharge directly into the atmosphere.

See 40 C.F.R. § 63.12005 (“Bypass means diverting a process vent

or closed vent system stream to the atmosphere such that it does not

first pass through an emission control device.”).

Pressure relief devices are safety devices that, in the process of

relieving pressure, can release fumes directly into the atmosphere.

See 40 C.F.R. § 63.12005 (“Pressure relief device means a safety

device used to prevent operating pressures from exceeding the

maximum allowable working pressure of the process component.

A common pressure relief device is a spring-loaded pressure relief

valve.”).

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rationality of the limit itself. The Clean Air Act prevents the

court from considering those objections because Petitioners

did not initially preserve them in the administrative process,

and EPA is still considering them in a pending

reconsideration proceeding. Given the absence of any

showing of a likelihood of irreparable harm, we also decline

to stay the effectiveness of the Rule until EPA completes its

reconsideration.

We also reject each of Petitioners’ claims that we are

now able to review on its merits. EPA’s PVC-combined

process vent limits do not conflict with emissions limits

applicable to other sources that discharge through PVC-

combined process vents. EPA reasonably chose not to

subcategorize process vents on the basis of their control

technology. EPA’s bypass and pressure relief device

regulations are reasonable compliance and monitoring

requirements, and Petitioners’ argument that the bypass-

detection regulation is a “beyond-the-floor” MACT

requirement lacks merit.

III.

Several of Petitioners’ challenges to the Rule are barred

because they were not raised during the notice and comment

period. See 42 U.S.C. § 7607(d)(7)(B). Under the Clean Air

Act, “the only objections that may immediately be raised

upon judicial review are those that were raised during the

public comment period. Objections raised for the first time in

a petition for reconsideration must await EPA’s action on that

petition.” Util. Air Regulatory Grp. v. EPA (UARG), 744

F.3d 741, 747 (D.C. Cir. 2014). That bar extends both to

substantive and procedural challenges and applies even if the

objections could not have been raised during the comment

period. See 42 U.S.C. § 7607(d)(9)(D)(ii); UARG, 744 F.3d

11

at 747; Am. Petroleum Inst. v. Costle, 665 F.2d 1176, 1192

(D.C. Cir. 1981). That requirement serves the important

function of assuring that the agency has had an opportunity to

explicate and evaluate objections before we review them. See

generally Appalachian Power Co. v. EPA, 249 F.3d 1032,

1065 (D.C. Cir. 2001); Appalachian Power Co. v. EPA, 135

F.3d 791, 799 n.14 (D.C. Cir. 1998).

Petitioners (1) did not raise their objections to the

adequacy of notice and comment during the notice and

comment period, (2) did not object that the final rule was not

a logical outgrowth of the proposed rule, (3) did not object to

the reasonableness of the PVC-combined process vent

emissions limits, and (4) did not object to the wastewater

limits. See Pet. Br. at 37, 48 (conceding failure to raise the

foregoing objections during the notice and comment period).

Those claims are therefore barred.

Petitioners assert that the court should reach the merits of

their challenges to the Rule despite their failure to raise them

during the notice and comment period. The Clean Air Act’s

otherwise categorical bar on judicial review of objections first

raised in a petition for reconsideration may be excused only in

limited circumstances. Our precedents recognize certain

narrow exceptions to the exhaustion requirement, including

where the agency completes reconsideration but refuses to

acknowledge that it has done so, or where it unreasonably

delays the completion of reconsideration. See Sierra Club v.

Thomas, 828 F.2d 783, 792-96 (D.C. Cir. 1987); see generally

Randolph-Sheppard Vendors of Am. v. Weinberger, 795 F.2d

90, 104-09 (D.C. Cir. 1986).6

6

Congress has partly abrogated Sierra Club v. Thomas, but its

analytical framework for determining whether EPA’s delay was

12

Petitioners suggest that EPA has functionally denied

their petitions for reconsideration. EPA granted the petitions

for reconsideration in September 2012 and does not anticipate

completing its review of those petitions until April 2016.

Petitioners also cite EPA’s data collection demands during the

reconsideration proceeding. EPA has issued several requests

for new data from PVC manufacturers, and EPA anticipates

opening a new notice and comment period on its proposed

modifications to the Rule before completing reconsideration.

According to Petitioners, EPA’s slow pace and ambitious data

unreasonable remains applicable to whether Petitioners may be

excused for their failure to exhaust their administrative remedies.

Thomas addressed the circumstances in which courts may compel

EPA to take action under the Clean Air Act, and, in that context,

held that this court had exclusive jurisdiction over claims to compel

agency action “unreasonably delayed.” Thomas, 828 F.2d at 792-

96. Congress in the 1990 Amendments to the Clean Air Act

abrogated Thomas’s jurisdictional holding and shifted to the district

court the power to compel EPA to act. See Clean Air Act

Amendments, Pub. L. No. 101-549, § 707(f), 104 Stat. 2399, 2683

(1990); see also 42 U.S.C. § 7604(a) (explaining that “the district

courts of the United States shall have jurisdiction to compel . . .

agency action unreasonably delayed”); S. Rep. No. 101-228, at 374

(1989). Those Amendments do not affect our jurisdiction here,

however, nor the aspect of Thomas on which we rely. This is not a

case seeking to compel EPA to take action, but a challenge to

existing EPA PVC emissions rules. Petitioners raise their

unreasonable-delay allegation in an effort to rebut EPA’s

contention that Petitioners must await completion of EPA’s

pending reconsideration of the challenged Rule. When it amended

the Clean Air Act, Congress anticipated this very type of case,

“where a complaint about agency inaction is ‘embedded’ in a

challenge to agency action,” and did not withdraw our jurisdiction.

See S. Rep. No. 101-228, at 374 (citing Ind. & Mich. Electric Co. v.

EPA, 733 F. 2d 489, 490 (7th Cir. 1984)).

13

collection effort show it is not reconsidering the Rule but has

embarked on a new rulemaking in the guise of

reconsideration.

EPA counters that the Clean Air Act requires EPA to

afford on reconsideration “the same procedural rights as

would have been afforded” at the time of the original

rulemaking, 42 U.S.C. § 7607(d)(7)(B), and that, in this case,

affording the parties those “same procedural rights” requires

additional data collection and new notice and opportunity for

comment. The agency is actively gathering additional data to

inform its action on reconsideration, anticipates holding open

a new notice and comment period, and predicts that it will

complete reconsideration by a date certain (April 2016).

There is thus neither a functional denial nor any suggestion in

this record that the Agency has finished reconsideration but

refused to acknowledge it.

Petitioners also have failed to make the requisite showing

that EPA has engaged in unreasonable delay. To establish a

claim of unreasonable delay, petitioners must show that they

have “a right the denial of which we would have jurisdiction

to review upon final agency action but the integrity of which

might be irreversibly compromised by the time such review

would occur.” Thomas, 828 F.2d at 796. To qualify as

unreasonable, the agency’s delay would have to be “so

egregious as to warrant mandamus.” Id. at 797 (internal

quotation marks omitted). We have identified two avenues to

establishing an unreasonable delay claim: (1) showing that an

agency violated a statutory “right to timely decisionmaking”

implicit in the agency’s regulatory scheme, or (2) showing

that some other interest—financial, aesthetic, or related to

human health and welfare, for example—“will be irreparably

harmed through delay.” Id. at 796-97.

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Petitioners have failed to establish that EPA has deprived

them of a statutory right to timely decisionmaking. In

evaluating such a claim, we will (a) determine “whether

Congress has imposed any applicable deadlines,” “exhorted

swift deliberation concerning the matter,” or otherwise

“implicitly contemplate[d] timely final action;” (b) determine

“whether interests other than that of timely decisionmaking

will be prejudiced by delay;” and (c) determine “whether an

order expediting the proceedings will adversely affect the

agency in addressing matters of a competing or higher

priority.” Id. at 797. In assessing those factors, we are

mindful that, “[a]bsent a precise statutory timetable or other

factors counseling expeditious action, an agency’s control

over the timetable” of its proceedings “is entitled to

considerable deference,” id. (alteration in original) (internal

quotation marks omitted) (quoting Sierra Club v. Gorsuch,

715 F.2d 653, 658 (D.C. Cir. 1983)), and that “[e]ven where a

statutory timetable exists, noncompliance with it has

sometimes been excused as long as the agency has acted

rationally and in good faith,” Gorsuch, 715 F.2d at 658 n.35.

The text and structure of the Act suggest that judgments

about the permissible duration of a Clean Air Act

reconsideration proceeding are fact bound and case specific.

The Clean Air Act does not specify limits on the permissible

duration of a reconsideration proceeding, and its provisions

generally grant the agency broad discretion to correct its own

mistakes before its rules are subjected to judicial review. See

42 U.S.C. §§ 7607(d)(7)(B), (d)(8).

EPA’s forecasted duration of the reconsideration of the

wastewater limit and the PVC-combined process vent limit is

reasonably proportionate to the gravity and complexity of the

rulemaking. EPA has attempted to promulgate a PVC Rule

multiple times, and, each time, the attempt has taken several

15

years. EPA’s first attempt began data collection in 1998, and

the Rule issued in 2002. See 67 Fed. Reg. 45,886, 45,889

(July 10, 2002). This rulemaking began data collection in

2009 for a Rule that issued in 2012. See PVC Rule, 77 Fed.

Reg. at 22,852, 22,854. The scope of EPA’s reconsideration

in this case is proportional to the scope of the alleged

shortcomings in the 2012 rulemaking, and EPA estimates that

its current reconsideration proceeding will take about four

years, a duration commensurate with that of EPA’s prior

efforts to set emissions limits for PVC production.

Petitioners also have failed to establish unreasonable

delay in completing reconsideration through the second route

our cases have identified: they have not shown that their

interests (in this case, financial) will be irreparably harmed if

the court awaits the outcome of EPA’s reconsideration

proceeding. See Thomas, 828 F.2d at 794-96; Randolph-

Sheppard Vendors, 795 F.2d at 107. As we have previously

explained in the cognate context of preliminary injunctions,

“[t]his court has set a high standard for irreparable injury.”

Chaplaincy of Full Gospel Churches v. England, 454 F.3d

290, 297 (D.C. Cir. 2006). Such injury must be “both certain

and great,” “actual and not theoretical,” “beyond

remediation,” and “of such imminence that there is a clear and

present need for equitable relief to prevent irreparable harm.”

Id. (internal quotation marks and citations omitted). Where

the injuries alleged are purely financial or economic, the

barrier to proving irreparable injury is higher still, for it is

“well settled that economic loss does not, in and of itself,

constitute irreparable harm.” Wisconsin Gas Co. v. FERC,

758 F.2d 669, 674 (D.C. Cir. 1985). Financial injury is only

irreparable where no “adequate compensatory or other

corrective relief will be available at a later date, in the

ordinary course of litigation.” Id.

16

Petitioners have failed to show any specific, identifiable

cost they will incur because of the Rule’s emissions limits.

They acknowledged at oral argument that the record contains

no evidence of their cost of compliance, and they did not then

articulate any. See Oral Arg. Rec. at 72:55-75:26. For its

part, EPA has estimated that “the overall economic impact of

this final rule on the affected industries and their consumers

should be low,” amounting to approximately 0.7 percent of

PVC manufacturers’ revenues. PVC Rule, 77 Fed. Reg. at

22,900. EPA has also estimated that much of the cost of

meeting the new emissions standards will arise from verifying

compliance with the standard (measuring hazardous air

pollutant concentrations from process vents, for example), not

purchasing new control technology. See id. at 22,899-900.

Because costs of measuring emissions in order to monitor

compliance must be incurred under any emissions limit, they

are not specific to the emissions limits’ asserted irrationality

and thus not a source of prejudice arising from delay as such.

Petitioners also have failed to establish that EPA’s post-

reconsideration emissions limits will differ materially from

the current limits. That showing matters because, if

Petitioners will have to make the same investments and incur

the same costs to comply with EPA’s ultimate Rule as they

have to make under the current Rule, then any delay in

shifting from the current limits to (presumptively materially

equivalent) final ones is harmless. The court’s assessment of

the post-reconsideration rule’s likely modest impact on

existing emissions limits shows that delay in replacing EPA’s

current emissions limits is in fact likely to be harmless.

In particular, with respect to the existing major source

wastewater limit, Petitioners have failed to show any

likelihood that the limit will materially change. Petitioners

argue the court should vacate EPA’s limit because EPA relied

17

on a faulty data point in setting the limit. But because EPA

set the limit through a methodology designed to protect

against variability of data, the distorting effect of a single,

erroneous data point was minimized; omitting the faulty data

point would make the wastewater limit 112 parts per million,

rather than 110 parts per million.7 See J.A. 317-18, 326-28.

Given that minimal difference, it is probable that Petitioners

would have incurred the same costs to comply with either

limit.

That conclusion is bolstered by Petitioners’ own

evidence. Petitioners asserted by post-argument letter to this

court that their claim of irreparable harm from the Rule’s

wastewater limit is substantiated by a document they

submitted to EPA in the ongoing reconsideration proceeding

measuring emissions from selected PVC production facilities.

See Letter from Counsel to Petitioners to the Panel (Nov. 21,

2014). The document (assuming its accuracy) cuts against

Petitioners’ position, however, for it reveals that Petitioners’

plants would be unable to comply even with a 1000 parts per

million wastewater limit, a limit ten times greater than the 110

parts per million limit in the current Rule. See Letter from

Richard Krock, Vinyl Institute to Andrea Siefers, USEPA,

EPA-HQ-OAR-2002-0037-0561, at 28 (Aug. 16, 2013) (“It is

important to note that even with a 1,000 ppm limit, the facility

would be in non-compliance at least three times during the

sampling period.”). Petitioners’ admission that they could not

comply even with a 1000 parts per million wastewater limit

shows that, whether EPA had set the limit at 112 parts per

7

Intervenors’ expert re-conducted EPA’s analysis without using the

data point that Petitioners contend is faulty, and the fresh

calculation produced a new limit of 112 parts per million. See

Intervenors’ Addendum, Sahu Dec. ¶¶ 9-12, Ex. B.

18

million or 110 parts per million, the different limit’s impact

on Petitioners likely would have been de minimis or zero.

Petitioners have not attempted to articulate how the

court’s failure to enjoin the Rule based on their other

unpreserved objections would result in irreparable harm.

They have not established that their procedural objections

mean that the Rule is likely to change after reconsideration.

Nor have they established that the PVC-combined process

vent emissions limits will differ so dramatically after

reconsideration that attempting to comply in the meantime

with the existing Rule will result in wasteful investments in

unnecessarily stringent control technologies.

Because Petitioners have not shown that EPA’s delay

violates a statutory right to timely decision making or will

otherwise cause them irreparable harm, they are not entitled to

immediate judicial review of their unpreserved claims.

Petitioners’ challenges stemming from the inadequacy of

notice and comment, to the PVC-combined process vent

limits, and to the wastewater limits—all first raised in

petitions for reconsideration before EPA—are barred from

review at this time.

IV.

Petitioners argue that, if the court cannot immediately

review their unpreserved claims, it should stay the

effectiveness of the challenged aspects of the Rule pending

the outcome of EPA’s reconsideration proceeding. For the

reasons outlined in the preceding Part, they have failed to

show that awaiting the completion of EPA’s reconsideration

will cause them irreparable harm. See Part III, supra; Nken v.

Holder, 556 U.S. 418, 434 (2009) (outlining the requirements

for obtaining a stay); D.C. Circuit Rule 18(a)(1). Petitioners

are accordingly not entitled to a stay.

19

The dissent contends that the Court should stay the major

source wastewater limit because “EPA itself does not oppose

a stay in this case.” Dissent at 1. But that oversimplifies

EPA’s position and does not account for the interests of other

stakeholders who supported the rule and who themselves

stand to suffer harm from EPA inaction.

In its briefing and at oral argument EPA was emphatic: it

did not waive its non-merits, threshold defense that

Petitioners are barred from challenging the wastewater limits

because they failed to object to them during the notice and

comment period. Resp. Br. 33-35; Oral Arg. Rec. at 30:00-

32:00; 40:30-45:00. EPA contended that, if the court found

the issue to be properly before the court, then and only then

would EPA “not oppose” a stay or vacatur of the wastewater

limits. Resp. Br. 35.

EPA’s consent is not alone a sufficient basis for us to stay

or vacate a rule. The court is not bound to accept, and indeed

generally should not uncritically accept, an agency’s

concession of a significant merits issue. Cf. Bowen v.

Georgetown Univ. Hosp., 488 U.S. 204, 212-13 (1988)

(holding that courts will not defer to an agency’s litigating

position where it contradicts the agency’s prior “regulations,

rulings, or administrative practice”). The risk is that an

agency could circumvent the rulemaking process through

litigation concessions, thereby denying interested parties the

opportunity to oppose or otherwise comment on significant

changes in regulatory policy. If an agency could engage in

rescission by concession, the doctrine requiring agencies to

give reasons before they rescind rules would be a dead letter.

See Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm

Mut. Auto. Ins. Co., 463 U.S. 29, 52 (1983).

20

We note, moreover, that the Clean Air Act provides that

“the effectiveness of [a] rule may be stayed during . . .

reconsideration . . . by the Administrator [of the EPA] or the

court for a period not to exceed three months.”

42 U.S.C. § 7607(d)(7)(B). The partial dissent contends that

the Court may stay a Clean Air Act rule indefinitely,

notwithstanding that language, pointing to the more general

stay provisions of the Administrative Procedure Act, 5 U.S.C.

§ 705, and our decision in Portland Cement Assoc. v. EPA,

665 F.3d 177, 189 (D.C. Cir. 2011) (per curiam), which

granted a stay pending reconsideration without explicitly

squaring it with the Clean Air Act’s three-month limitation.

We need not reconcile the divergent authorities on the stay

question however, because, even assuming the court’s power

to grant them one, Petitioners have failed to show irreparable

harm warranting a stay.

V.

Petitioners’ preserved challenges to the substance of

EPA’s Rule fail on their merits. EPA’s PVC-combined

process vent limits do not conflict with other emissions limits,

and EPA’s decision not to subcategorize process vents on the

basis of their emissions control technology was reasonable.

EPA’s bypass opening requirements are not arbitrary and

capricious, and its requirement that PVC manufacturers install

monitoring equipment on pressure relief devices is not

irrational. Finally, Petitioners’ argument that some of EPA’s

bypass regulations are unlawful beyond-the-floor MACT

requirements stems from misapprehension of the Clean Air

Act and is without merit.

First, the Rule’s PVC-combined process vent limits do

not create a regulatory conflict with other emissions limits.

Petitioners insist that because PVC-combined process vent

21

limits, by their very nature, incidentally limit emissions from

sources outside the PVC source category, the Rule creates a

conflict with the emissions limits applicable to those other

sources. But, as EPA explained in the preamble to the present

Rule, overlapping limits are not necessarily “conflicting” or

“inconsistent.” PVC Rule, 77 Fed. Reg. at 22,865 (internal

quotation marks omitted). If a PVC manufacturer chooses to

discharge combined emissions from PVC and non-PVC

processes through a single vent, that manufacturer must

comply with limits applicable to both and, where they differ,

comply with the more stringent of the two. Id. If the two

limits rely on different methods of measurement, both

methods must be used. See id. That may be burdensome, but

it is neither unachievable nor unreasonable. Manufacturers

hold the keys to this particular regulatory box. They can

avoid the overlap, as EPA explained, by separating PVC-

production emissions from those emanating from other

sources. Id. If they do so, the PVC-only process vent limits

will apply to the emissions from PVC production, and the

other source’s relevant emissions limits will apply to its

emissions, eliminating the requirement that the other source

comply with the PVC-combined emissions limits. Id.

Second, EPA reasonably decided not to subcategorize

process vents on the basis of which particular emissions

control technology PVC manufacturers choose. The

conclusion that EPA need not—indeed should not—relax its

emissions limits when polluters use insufficiently effective

control technology is inherent in the very idea of technology-

forcing regulation. Petitioners contend, however, that the

superior effectiveness of their emissions control technology is

not accurately measured by EPA’s approach.

The thrust of Petitioners’ argument is as follows: Most

PVC production facilities use “thermal oxidizers” to reduce

22

their emissions into the atmosphere of hazardous air

pollutants. Some, however, use “vent gas absorbers,” a

control technology with a “radically different” emissions

profile from that of a thermal oxidizer. Pet. Br. 52. Thermal

oxidizers vent continuously and at high flow rates; vent gas

absorbers vent intermittently and at very low flow rates.

EPA’s method of determining compliance with the

Rule’s process vent limits relies on measuring the

concentration of hazardous air pollutants in a process vent’s

effluent stream. A difference in how the two technologies

operate means a vent gas absorber’s effluent stream has a

higher maximum concentration of hazardous air pollutants

than does the relatively consistent effluent stream from a

thermal oxidizer. Petitioners contend that EPA inaccurately

rates vent gas absorbers as less effective than thermal

oxidizers at controlling emissions because of the higher

concentration of pollutants that vent gas absorbers emit. Vent

gas absorbers may nonetheless be a better emissions control

technology than thermal oxidizers, Petitioners claim, because

they emit their relatively concentrated pollutants only

intermittently and at lower rates. The Rule’s focus on the

concentration of hazardous air pollutants means that vent gas

absorbers rate poorly even though they may in fact be more

effective.

Spelling out the objection makes it immediately clear that

Petitioners’ real dispute is not with inadequate

subcategorization. Petitioners concede that it was reasonable

for EPA to require vent gas absorbers and thermal oxidizers to

meet the same emissions limits. Instead, Petitioners’

grievance appears to be that the Rule’s method of measuring

the emission of hazardous air pollutants erroneously

concludes that vent gas absorbers are less effective emissions

controls than thermal oxidizers. Petitioners’ claim, in effect,

23

is that EPA acted arbitrarily and capriciously in failing to

create an alternate method of measuring output from a PVC

process vent on the basis of the total mass of hazardous air

pollutants it emits, rather than on the basis of the

concentration of hazardous air pollutants in its effluent

stream.

EPA, however, reasonably chose not to create an

alternative measurement format on the basis of total mass

emission rates. In the Rule, EPA explained that it “considered

setting alternative formats for the process vent emission

limits” but that, in its judgment, it “did not have sufficient

information provided from industry on process vent stream

flow rates and concentrations to develop or evaluate other

formats, such as mass emission rates.” PVC Rule, 77 Fed.

Reg. at 22,869. Petitioners counter that EPA’s explanation is

insufficiently specific and that its want of specificity alone

suffices to render it arbitrary and capricious. See Ne. Md.

Waste Disposal Auth. v. EPA, 358 F.3d 936, 949 (D.C. Cir.

2004). We disagree. EPA’s explanation, though short, fully

conveys the agency’s rationale in declining to set an

alternative measurement format and furnishes concrete

grounds for framing a challenge to the decision’s substantive

rationality. Petitioners have done so, arguing that EPA had

sufficient information to set alternative emissions formats.

Pet. Br. 53. On the merits, Petitioners have not carried their

burden of showing that, contrary to EPA’s explanation, it did

in fact have sufficient data to establish an alternative

emissions format. We defer to EPA’s judgments about data

insufficiency, at least in the absence of further information or

explanation from Petitioners regarding why deference is

inappropriate. Petitioners’ challenge to EPA’s decision not to

subcategorize process vents on the basis of their emissions

control technology therefore lacks merit.

24

Third, EPA’s bypass-opening requirements are not

arbitrary and capricious. Petitioners argue that EPA’s

regulations make opening a bypass unlawful without

exception, even if the opening occurs during routine

maintenance after performing the equipment opening steps

called for elsewhere under the Rule governing maintenance,

and that compliance with the Rule is therefore impossible.

Pet. Br. 55-56 (citing 40 C.F.R. §§ 63.11955, 63.11930(c)).

Petitioners misread EPA’s regulations. The regulations

anticipate that regulated entities will be allowed to open

bypasses during maintenance as long as they comply with the

opening provisions set forth therein.

40 C.F.R. §§ 63.11955(a)-(b). Otherwise, the very existence

of regulations setting forth instructions for opening bypasses

would be superfluous. In the preamble to the Rule, EPA

explained that it does not interpret 40 C.F.R. § 63.11930(c) as

categorically prohibiting all discharges through bypasses. See

PVC Rule, 77 Fed. Reg. at 22,885. EPA’s interpretation of its

own regulations is entitled to our deference. See Auer v.

Robbins, 519 U.S. 452, 462-63 (1997). In view of the text of

EPA’s regulations and the Agency’s repeated representations

about their meaning, Petitioners’ claims that EPA’s

regulations arbitrarily and capriciously prohibit opening

bypasses for purposes of routine maintenance are without

merit.

Fourth, EPA’s requirements for monitoring pressure

relief devices are not arbitrary and capricious. Pressure relief

devices are important safety equipment that, if not built to

route emissions through emissions controls, may, when

triggered, emit significant amounts of hazardous air pollutants

directly into the atmosphere. See PVC Rule, 77 Fed. Reg. at

22,881-82. EPA requires that all releases by pressure relief

devices meet the Rule’s process vent emissions limits. 40

C.F.R. § 63.11915(c)(1). EPA provides for two methods of

25

compliance: (1) PVC manufacturers may route discharges

from pressure relief devices through emissions control

equipment to ensure compliance with the Rule, or (2) equip

their pressure relief devices with release indicators to detect

uncontrolled discharges. 40 C.F.R. § 63.11915(c)(1)-(2).

EPA concluded that such monitoring is necessary to ensure

that uncontrolled emissions will be “identified and controlled

in a timely manner” and that “repeat problems” will be

corrected. PVC Rule, 77 Fed. Reg. at 22,882.

Petitioners contend the regulation is unreasonable,

however, because EPA did not have enough data about

hazardous air pollutant releases from pressure relief devices to

justify imposing a costly monitoring requirement. According

to Petitioners, releases from pressure relief devices may be so

rare, insignificant, and well prevented or well detected by

current industry monitoring methods that the regulation is

wasteful and unnecessary. EPA responded in the Rule by

explaining that, in its judgment based on the data in the

record, PVC facilities had not been effectively detecting and

recording releases from pressure relief devices. PVC Rule, 77

Fed. Reg. at 22,882.

EPA’s judgment was reasonable. The paucity of data

about the frequency and severity of discharges from pressure

relief devices could be because the PVC industry lacks

effective methods for detecting or recording releases. If EPA

were required to gather exhaustive data about a problem for

which gathering such data is not yet feasible, the agency

would be unable to act even if such inaction had potentially

significant consequences. We have consistently held that, in

situations in which an agency must make a judgment in the

face of a known risk of unknown degree, the “agency has

some leeway reasonably to resolve uncertainty, as a policy

matter, in favor of more regulation or less.” Ctr. for Auto

26

Safety v. Fed. Highway Admin., 956 F.2d 309, 316 (D.C. Cir.

1992). Here, the agency’s choices were to do nothing,

consistent with PVC manufacturers’ assertions that their

current efforts were adequate, or promulgate a regulation to

protect against risk. See PVC Rule, 77 Fed. Reg. at 22,881-

82. Petitioners point to some data EPA had on certain devices

and claim EPA ignored it. But, as EPA explained in the Rule,

that data did not give EPA reason to believe that all PVC

manufacturers have and use effective discharge detection and

recording technology. Id. EPA recognized the high stakes of

the decision to do nothing, explaining that releases from

pressure relief devices “have the potential to emit large

quantities of [hazardous air pollutants], and a large number of

these releases that may occur may not be identified and

controlled in a timely manner, and may be due to repeat

problems that have not been corrected.” Id. at 22,882. EPA

thus reasonably exercised its broad discretion to require

monitoring of pressure relief devices to ensure compliance

with the Rule’s emissions limits.

Fifth, EPA’s regulations designed to ensure the detection

of discharges through bypasses are not beyond-the-floor

MACT requirements. The Rule requires PVC manufacturers

to install a flow indicator, lock-and-key system, or “car seal”

on bypasses to detect when they are opened. 40 C.F.R. §§

63.11930(c)(1), (2).8 Petitioners contend that EPA failed to

determine whether its regulation would be “achievable” in

light of “cost, energy requirements, and other factors,” as

8

A car seal may be an inexpensive plastic fastener (e.g., a zip tie)

or a steel cable closed in a loop with a small block of aluminum or

steel. See 40 C.F.R. § 63.12005 (defining “Car-seal” as “a seal that

is placed on a device that is used to change the position of a valve .

. . in such a way that the position of the valve cannot be changed

without breaking the seal”).

27

EPA is required to do before imposing a beyond-the-floor

MACT limit under Section 112(d)(2) of the Clean Air Act.

Sierra Club v. EPA, 353 F.3d 976, 989 (D.C. Cir. 2004); see

42 U.S.C. § 7412(d)(2). Petitioners’ argument lacks merit

because EPA’s bypass Rule simply is not a beyond-the-floor

MACT requirement and so is not subject to Section 112(d)(2).

The requirement was enacted pursuant to EPA’s statutory

authority under Section 114(a)(1)(C), permitting the agency to

require the installation, use, and maintenance of monitoring

equipment to ensure compliance with a MACT emissions

limit. See 42 U.S.C. § 7414(a)(1)(C); PVC Rule, 77 Fed. Reg.

at 22,860. Bypass flow indicators, locks, and car seals are all

monitoring devices: they determine whether a PVC facility is

in violation of the Rule by identifying either mechanically (as

with a flow indicator) or visually (as with an open lock or

broken seal) an open bypass that may discharge pollutants.

EPA reasonably and lawfully required PVC manufacturers to

install, use, and maintain them pursuant to Section

114(a)(1)(C). We therefore reject Petitioners’ argument that

EPA’s bypass monitoring regulation somehow triggers

Section 112(d)(2)’s cost-benefit requirements.

***

For the foregoing reasons we deny the petitions for

review.

KAVANAUGH, Circuit Judge, dissenting in part: EPA

issued a rule that imposes limits on emissions of hazardous air

pollutants by manufacturers of polyvinyl chloride. But EPA

later concluded that one category of those limits – the so-

called wastewater limits on hazardous air pollutants that may

be dissolved in wastewater – was based on bad data. EPA is

therefore reconsidering the wastewater limits. EPA says that

it will complete the reconsideration process in 2016.

Petitioners, who are manufacturers of polyvinyl chloride,

contend that EPA’s flawed wastewater limits should be stayed

under 5 U.S.C. § 705, the general Administrative Procedure

Act provision authorizing stays pending judicial review.

Petitioners are correct. They obviously have demonstrated a

likelihood of success on the merits; after all, EPA concedes

that the wastewater limits are flawed. And petitioners also

have shown irreparable harm – namely, the high costs to

comply with the flawed wastewater limits. Moreover,

petitioners have precedent on their side: In a similar case in

which EPA was reconsidering a concededly flawed rule, we

readily granted a stay. See Portland Cement Association v.

EPA, 665 F.3d 177, 189 (D.C. Cir. 2011) (“We will, however,

enter a stay of the NESHAP standards applicable to clinker

storage piles. EPA has conceded that it ‘did not give

sufficient notice’ of those standards and has granted PCA’s

request for reconsideration . . . . Thus, industry should not

have to build expensive new containment structures until the

standard is finally determined.”).

Even EPA itself does not oppose a stay in this case.

EPA’s position is telling. Given the circumstances here, as

well as our Portland Cement precedent, I would stay the

wastewater limits pending judicial review.

To be sure, the Clean Air Act imposes a 3-month limit on

stays pending agency reconsideration. See 42 U.S.C.

§ 7607(d)(7)(B). But Section 705 of the APA authorizes

2

courts to stay agency rules pending judicial review without

any time limit on the duration of the stay. See 5 U.S.C. § 705

(reviewing court “may issue all necessary and appropriate

process to postpone the effective date of an agency action or

to preserve status or rights pending conclusion of the review

proceedings”); In re GTE Service Corp., 762 F.2d 1024, 1026

(D.C. Cir. 1985) (Section 705 provides “statutory authority to

stay agency orders pending review in this court.”). 1

Therefore, in this case, we should issue a stay that remains in

effect pending judicial review.

For those reasons, I respectfully dissent from the majority

opinion’s decision not to stay EPA’s wastewater limits. 2

1

The Clean Air Act does not displace Section 705, the general

APA provision governing stays pending judicial review. The Clean

Air Act expressly provides that several provisions of the APA – 5

U.S.C. §§ 553-557 and 706 – “shall not, except as expressly

provided in this subsection, apply to actions to which this

subsection applies.” 42 U.S.C. § 7607(d)(1). Section 705 is not on

that list. By contrast, Congress has displaced Section 705 in other

statutory regimes. Cf. 16 U.S.C. § 1855(f)(1) (fishery management

regulations subject to judicial review in accordance with

Administrative Procedure Act, but not with Section 705); id.

§ 3636(c) (Pacific salmon fishing regulations subject to judicial

review in accordance with Administrative Procedure Act, but not

with Section 705). Had Congress wanted to prevent courts in Clean

Air Act cases from issuing stays under Section 705, Congress could

have done so.

2

Petitioners also challenge EPA’s process vent emissions

limits and the compliance and monitoring provisions. I agree with

the majority opinion that those claims lack merit.