Opposition Brief — National-Southwire Aluminum Co. v. United States Environmental Protection Agency

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No. 88-315

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Iu the Supreme Court of the United States

OCTOBER TERM, 1988

NATIONAL-SOUTHWIRE ALUMINUM CO., PETITIONER

Vv.

UNITED STATES ENVIRONMENTAL

PROTECTION AGENCY, ET AL.

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

BRIEF FOR THE RESPONDENTS IN OPPOSITION

CHARLES FRIED

Solicitor General

ROGER J. MARZULLA

Assistant Attorney General

BRIAN FALLER

Attorney

Department of Justice

Washington, D.C. 20530

(202) 633-2217

QUESTION PRESENTED

Whether the Environmental Protection Agency

(EPA) correctly determined that turning off air

pollution control equipment at petitioner’s aluminum

reduction plant, which would increase fluoride emis-

sions by more than 1,000 tons annually, would con-

stitute a modification of a stationary source within

the meaning of Section 111(a)(4) of the Clean Air

Amendments of 1970, 42 U.S.C. 7411(a) (4).

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TABLE OF CONTENTS

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TABLE OF AUTHORITIES

Cases:

Chevron U.S.A. Inc. v. NRDC, Inc., 467 U.S. 837

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National Asphalt Pavement Ass’n Vv. Train, 539

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Train V. NRDC, Inc., 421 U.S. 60 (1975) .............. 3

Statutes:

Clean Air Amendments of 1970, 42 U.S.C. (&

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§ 111 (a) (2), 42 U.S.C. 7411(a) (2) ....20000 2,8

§ 111(a) (4), 42 U.S.C. 7411(a) (4) ....0000202.. 2, 7-8

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Statutes—Continued:

39 Fed. Reg. (1974) :

Miscellaneous:

H.R. Rep. 91-1146, 91st Cong., 2d Sess. (1970)...

S. Rep. 91-1196, 91st Cong., 2d Sess. (1970) ........

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Iu the Supreme Court of the United States

OCTOBER TERM, 1988

No. 88-315

NATIONAL-SOUTHWIRE ALUMINUM CO., PETITIONER

Vv.

UNITED STATES ENVIRONMENTAL

PROTECTION AGENCY, ET AL.

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

BRIEF FOR THE RESPONDENTS IN OPPOSITION

OPINION BELOW

The opinion of the court of appeals (Pet. App. la-

18a) is reported at 838 F.2d 835.

JURISDICTION

The judgment of the court of appeals (Pet. App.

26a-27a) was entered on February 1, 1988, and a

petifiiton for rehearing was denied on March 25, 1988.

The petition for a writ of certiorari was filed on June

23, 1988. The jurisdiction of this Court is invoked

under 28 U.S.C. 1254(1).

(1)

2

STATEMENT

1. In the Clean Air Amendments of 1970, 42

U.S.C. (& Supp. IV) 7401 et seg., Congress adopted a

two-pronged strategy for improving air quality to

protect human health and welfare. The first prong

is to prevent or minimize any increases in existing

levels of pollution. This policy is embodied :in Sec-

tion 111(b) of the Act, 42 U.S.C. 7411(b), which au-

thorizes a system of rigorous, nationally uniform

emission standards that apply to new sources of pol-

lution and to existing sources from which emissions

are increased. These standards, known as new source

performance standards (NSPS), specify the maxi-

mum permissible amounts of various pollutants that

may be emitted from newly constructed sources and

from existing sources that have undergone a “modi-

fication.” § 111(a)(2), 42 U.S.C. 7411(a)(2). The

term “modification” is defined in Section 111(a) (4),

42 U.S.C. 7411(a) (4), as follows:

The term “modification” means any physical

change in, or change in the method of operation

of, a stationary source which increases the

amount of any air pollutant emitted by such

source or which results in the emission of any

air pollutant not previously emitted.

The second prong of Congress’s strategy for attain-

ing clean air is the reduction of emissions from exist-

ing, unmodified sources. One of several provisions in-

tended to achieve this goal is Section 111(d) of the

Act, 42 U.S.C. 7411(d), which provides for the

States, with EPA approval, to adopt plans that in-

clude measures for reduction of emissions from ex-

isting sources of pollutants for which EPA has not

3

promulgated national ambient air quality standards

or national emission standards for hazardous air

pollutants.’ Fluoride, which is involved in this case,

is one such pollutant. In the case of these pollutants,

Section 111(d) requires the States to establish stand-

ards of performance for existing, unmodified sources

that would be subject to the NSPS if they were new

or modified.

2. Petitioner National-Southwire Aluminum Com-

pany owns and operates a primary aluminum reduc-

tion plant in Hawesville, Kentucky, that emits fluor-

ide in both gaseous and particulate forms. When the

plant was constructed in 1969, before passage of the

Clean Air Amendments of 1970, petitioner equipped

the plant with wet scrubbers to control emissions of

gaseous fluoride. After passage of the Clean Air

Amendments, EPA determined that fluoride air pollu-

tion presents a serious threat to public welfare be-

cause it damages natural vegetation, herbivorous ani-

mals, and agricultural crops. On October 23, 1974,

EPA promulgated NSPS for fluoride emissions from

new and modified primary aluminum reduction

plants. See 39 Fed. Reg. 37730. Kentucky was then

required by Section 111(d) of the Act to adopt state

standards limiting fluoride emissions from existing,

1 EPA has set national ambient air quality standards for

six pollutants: lead, ozone, carbon monoxide, sulfur dioxide,

nitrogen dioxide, and particulate matter. See 40 C.F.R. Pt.

50. For these pollutants, the States are required by Section

110 of the Act to set emission standards for individual sources

that are sufficiently stringent to prevent the combined pollu-

tion from all sources from exceeding the ambient air quality

standards. See generally Train v. NRDC, Inc., 421 U.S. 60,

63-67 (1975). EPA’s national emission standards for hazard-

ous air pollutants are listed in 40 C.F.R. Pt. 61, and do not

apply to fluorides.

4

unmodified plants. Kentucky first adopted such

standards in 1981, and they were approved by EPA

in 1982. These standards had the effect of preventing

any increase in the emission of gaseous fluorides from

petitioner’s Hawesville plant, but did not require

petitioner to reduce those emissions. Pet. App. 3a-

4a.

Thereafter, petitioner proposed to shut down the

wet scrubbers at the Hawesville plant. According to

data supplied to EPA by petitioner, that action would

increase fluoride emissions from the plant by 1,174

tons per year.’ Petitioner sought and obtained from

Kentucky a relaxation of the State’s Section 111(d)

gaseous fluoride emission standard to the extent nec-

essary to permit that increase. The relaxation, how-

ever, is not effective unless and until it is approved

by EPA. See 40 C.F.R. 60.23, 60.27. Kentucky sub-

mitted a proposed form of its relaxed Section 111(d)

standard to EPA for comment on March 22, 1985.

The proposal included a stipulation that if petitioner

turned off the wet scrubbers at its plant to take ad-

vantage of the relaxed standard, such a change in its

method of operation would not be considered a ‘“‘modi-

fication” that would render the plant subject to the

NSPS. EPA informed Kentucky that the latter pro-

vision would not be approved. Nevertheless, on April

3, 1986, Kentucky submitted for EPA’s final ap-

proval a relaxed Section 111(d) standard that in-

cludes the same stipulation. Pet. App. 4a-5a. That

submission is pending before EPA.

? EPA has determined that the de minimis level for fluoride

emissions is three tons per year and that emissions in excess

of that amount could cause damage to vegetation. 45 Fed. Reg.

52676, 52709 (1980); 40 C.F.R. 52.21(b) (23) (i). Thus, the

proposed 1,174-ton annual increase is nearly 400 times the

level that EPA has found to be significant. Pet. App. 12a n.8.

5

On August 27, 1986, petitioner requested a formal

determination from EPA, pursuant to 40 C.F.R. 60.5,

whether turning off the wet scrubbers at its plant

would be a “modification” of a stationary source that

would trigger application of the NSPS for flouride

emissions. On September 22, 1986, EPA rendered a

decision rejecting petitioner’s contention that pollu-

tion control equipment is not part of the stationary

source and concluding that turning off the scrubbers

at petitioner’s plant would be a modification (Pet.

App. 19a-26a). EPA reasoned that the exclusion of

pollution control equipment from the definition of

“stationary source” would be “contrary to the plain

words of the definition” and that “inclusion of air

pollution control equipment as part of a stationary

source is essential if the Administrator is to imple-

ment Section 111(b)” (id. at 21a).

3. Petitioner then sought review in the United

States Court of Appeals for the Sixth Circuit, which

sustained EPA’s decision (Pet. App. la-lda). The

court first rejected petitioner’s contention that a

“stationary source” encompasses only pollution gen-

erating equipment and therefore does not encompass

an emission control system (id. at 8a-10a). The

court reasoned that although the statutory definition

of the term “stationary source’’ does not specifically

mention pre-existing pollution control equipment, such

equipment is not excluded from the definition’s sweep

(id. at 8a). Moreover, the court noted that EPA con-

cluded when it amended the applicable regulations in

1975 that pollution control equipment is included as

part of a stationary source.’ The court found this in-

*On that occasion, EPA determined that if increases in

pollution resulting from an operational change are offset by

improvements in an existing pollution control system, the

6

terpretation “1easonable and not inconsistent with the

statutory language,” and therefore entitled to defer-

ence (id. at 9a-10a).

The court of appeals next held that turning off the

wet scrubbers at petitioner’s plant would not fall

within a regulatory exception stating that the term

“modification” shall not be considered to include

“Tt]he addition or use of any system or device whose

primary function is the reduction of air pollutants,

except when an emission control system is removed or

is replaced by a system which the Administrator

determines to be less environmentally beneficial” (40

C.F.R. 60.14(e)(5)). The court stressed that the

exception does not apply to the “removal” of a pollu-

tion control system, and it explained that even the

replacement of one pollution control system with an-

other constitutes a modification if the Administrator

determines that the replacement would be less en-

vironmentally beneficial, which would be the result

in this case because petitioner’s proposal ‘‘would leave

gaseous fluorides virtually uncontrolled” (Pet. App.

10a-lla).

Finally, the court found no inconsistency between

EPA’s interpretation of the terms “stationary

source” and “modification” and the primary role of

the States in developing plans under Section 111(d)

for the control of pollutants emitted from existing,

unmodified plants. In the court’s view, Section 111

(b) “was ‘designed to prevent new [air] pollution

problems’ by regulating both newly-constructed

sources of pollution and sources that increase their

emissions,” and “[t]he effect of including modified

as well as newly-constructed sources under its pro-

change would not be regarded as a modification (Pet. App. 9a,

citing 30 Fed. Reg. 36946 (1974) ).

7

visions is to establish existing levels of emissions as

a baseline above which an existing source may not

pollute without becoming subject to the NSPS” (Pet.

App. 13a, quoting National Asphalt Pavement Ass’n

v. Train, 539 F.2d 775, 783 (D.C. Cir. 1976) ). “[I]t

is clear,” the court concluded, “that Congress in-

tended that federal enforcement of federal air pollu-

tion standards governing new or modified stationary

sources not be controlled by the states’ (Pet. App.

14a).*

ARGUMENT

The decision of the court of appeals is correct and

does not conflict with any decision of this Court or

of another court of appeals. The petition for a writ

of certiorari therefore should be denied.

1. EPA’s determination that turning off the scrub-

bers at petitioner’s plant would constitute a “modi-

fication” is based on a straightforward application

of the statutory definition of that term. Section 111

(a) (4) of the Act, 42 U.S.C. 7411(a) (4) (emphasis

added), provides:

The term “modification” means any physical

change in, or change in the method of operation

of, a stationary source which increases the

amount of any air pollutant emitted by such

source or which results in the emission of any

air pollutant not previously emitted.

Petitioner’s aluminum reduction plant is a “station-

ary source” of fluoride emissions, and operating the

plant without the wet scrubbers is unquestionably a

“change in the method of operation” of that source.

Furthermore, it is undisputed that turning off the

scrubbers would “increase[] the amount of [fluoride]

‘Judge Boggs filed a dissenting opinion (Pet. App. 15a-

18a).

8

air pollutant emitted” by approximately 1,174 tons

per year. Thus, by the express terms of Section 111

(a) (4), turning off the scrubbers would constitute

a “modification” of an existing source that, in turn,

would trigger the application of the nationally uni-

form NSPS for fluoride emissions. As the court of

appeals observed (Pet. App. 8a-9a), EPA has inter-

preted the statutory provisions in this manner since

1975, when it amended the implementing regulations.

At the very least, this longstanding administrative

position “tis based on a permissible construction of

the statute,” and it therefore is binding on the courts.

Chevron U.S.A. Inc. v. NRDC, Inc., 467 U.S. 837,

843 (1984)

2. Petitioner makes no attempt to answer this

analysis of the text and administrative interpretation

of the relevant statutory provisions, Petitioner ar-

gues (Pet. 11-14), however, that EPA’s decision in

this case is contrary to the legislative intent under-

lying Section 111, because that section allows the

States to regulate emissions from existing sources of

pollution. This argument rests on an erroneous view

of the ambit of the States’ regulatory authority.

Although Congress did not intend to require that all

existing sources be retrofitted to comply with the

NSPS, Congress expressly provided in Section 111

(a)(2) that those existing sources that undergo a

“modification” must comply with the NSPS. Section

111 thus was intended “to prevent new air pollution

problems” that might result from new sources or the

modification of existing sources. S. Rep. 91-1196,

M1st Cong., 2d Sess. 16 (1970). For this reason,

>See also H.R. Rep. 91-1146, J1st Cong., 2d Sess. 10 (1970)

(“new sources may take the form either of entirely new

facilities or expanded or modified facilities, or of expanded or

a

9

EPA’s determination that the proposed change in the

operation of petitioner’s plant would constitute a

modification because it would substantially increase

fluoride emissions is fully consistent with the pur-

poses of Section 111.

3. Petitioner’s contention (Pet. 12-13) that EPA’s

interpretation, sustained by the court of appeals,

would “prevent a State from correcting overly strict

non-health-related emission standards” is both erro-

neous and irrelevant. EPA’s determination in this

case does not invalidate Kentucky’s amendment of its

Section 111(d) standard for the emission of gaseous

fluorides from existing sources. Once approved by

EPA, the state standard will have the force and

effect of law. However, the effect of the relaxed

standard is only that the state plan will not prohibit

increased emissions. Such an amendment of a state

plan does not serve to exempt an existing source from

the overriding federal standards in the NSPS if in-

creased emissions permitted by the state plan result

from a “modification” of the source—as the iricreased

emission of 1,174 tons of fluoride annually from peti-

tioner’s plant clearly do.

In addition, although EPA’s determination regard-

ing petitioner’s proposal to shut down its pollution

control equipment does have the effect in this case of

preventing petitioner from taking full advantage of

the State’s relaxation of its Section 111(d) standard,

and to that extent limits the practical impact of the

State’s action, that incidental effect at most impli-

cates secondary policy considerations concerning the

role of the States under the Clean Air Amendments;

those considerations furnish no basis for ignoring the

modified operations which result in substantially increased

pollution’).

10

“unambiguously expressed intent of Congress” (Chev-

ron, 467 U.S. at 842-843) to require modified sources

to comply with the NSPS.° There is no evidence of a

congressional intent to exempt from the NSPS a

modification of an existing facility that causes

substantial increase in emissions, simply in order to

enable a discharger of pollutants to take advantage

of a relaxed Section 111(d) standard.

4, Finally, petitioner contends (Pet. 15-16) that

the court of appeals erred in concluding that the

EPA regulation that exempts specific actions from

being considered “modifications” does not apply to

petitioner’s proposal to turn off its scrubbers. This

contention is without merit and does not warrant

review by this Court.

The regulation in question provides that the fol-

lowing does not constitute a modification (40 C.F.R.

60.14(e) (5)): |

The addition or use of any system or device

whose primary function is the reduction of air

pollutants, except when an emission control sys-

tem is removed or is replaced by a system which

the Administrator determines to be less environ-

mentally beneficial.

This regulation is inapplicable here for a number of

reasons. First, turning off the scrubbers is not the

“addition or use’ of a pollution control system; as

* The other policy consideration petitioner advances (Pet.

13-14)—that the court of appeals’ ruling “would discourage

voluntary pollution control”—likewise cannot override the

explicit statement of congressional] intent embodied in Section

111. Moreover, there is no reason to anticipate such a deter-

rent effect in the unusual circumstances of this case, which

involve pollution control equipment that was voluntarily in-

stalled before the Clean Air Amendments of 1970 were passed

and that remains functional and effective to this day.

11

the court of appeals observed, petitioner’s proposal

“contemplates the non-use, or subtraction of a pol-

lution control device” (Pet. App. lla (emphasis in

original) ). Second, the exception is expressly inap-

plicable to the “removal” of an emission control sys-

tem, which is essentially what petitioner seeks to ac-

complish. Third, the exception also is expressly in-

applicable to the replacement of one pollution control

system by another that the Administrator finds to

be “less environmentally beneficial”; here, petitioner

does not even seek to “replace” its scrubbers with

equally or more effective emission control equipment,

and turning off the scrubbers would in any event be

“less environmentally beneficial” because it would in-

crease fluoride emissions 400-fold and “leave gaseous

fluorides virtually uncontrolled” (Pet. App. 11a,

12a).’ Finally, petitioner’s interpretation of the stat-

utory term “modification” and the regulatory excep-

tion to that term would be inconsistent with Con-

7 Petitioner claims (Pet. 15-16) that the court of appeals

usurped the Administrator’s role by holding that petitioner’s

proposal would be “less environmentally beneficial.” Peti-

tioner relies on the language of the regulation stating that

the exception is inapplicable to a replacement of old equip-

ment by a new system “which the Administrator determines”

to be less beneficial (40 C.F.R. 60.14(e) (5)). The court below

should not be faulted on this ground, because petitioner did

not rely on the regulatory exception in proceedings before

the Administrator (Pet. App. 10a) and therefore did not give

the Administrator an opportunity to address the issue. More-

over, it is clear in this case that petitioner’s proposal would

be less environmentally beneficial, since it would result in a

substantial increase in fluoride emissions that would not be

offset by a decrease in emissions of another pollutant. See

note 8, infra.

12

gress’s overriding goal of achieving “maximum feasi-

ble control” of air pollutants (id. at 1la).*

CONCLUSION

The petition for a writ of certiorari should be

denied.

Respectfully submitted.

CHARLES FRIED

Solicitor General

ROGER J. MARZULLA

Assistant Attorney General

BRIAN FALLER

Attorney

OCTOBER 1988

* As the court of appeals explained, the regulation upon

which petitioner relies was intended to be a “de minimis

exception * * * to permit a source to install a pollution control

system that would bring about a major decrease in emissions

of one pollutant while causing a smaller, incidental increase in

emissions of another pollutant” (Pet. App. 10a, 11a, ciftfng 39

Fed. Reg. 36948 (1974)). In this case, the increase in fluoride

emissions would not be the “incidental” consequence of efforts

to control emissions of another pollutant; it would be the

direct consequence of the simple decontrol of the emission of

fluorides. Moreover, the 1,174-ton increase in fluoride emis-

sions that petitioner’s proposal would bring about each year

can scarcely be termed de minimis (Pet. App. 12a).

YY U.S. GOVERNMENT PRINTING OFFICE; 1988 202037 60727