Petition — Alabama Power Co. v. Sierra Club

B38 = 1429 Otis Supreme Court US.

FEB 28 1984

No. 83-

TEVAS,

CLERK

IN THE

Supreme Court of the United States

OCTOBER TERM, 1983

ALABAMA POWER Co., et al.,

Petitioners,

Vv.

SIERRA CLUB, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

HENRY V. NICKEL

(Counsel of Record)

F. WILLIAM BROWNELL

MICHELE POLLAK

HUNTON & WILLIAMS

P.O. Box 19230

2000 Pennsylvania Ave., N.W.

Washington, D.C. 20036

(202/955-1500)

Counsel for Petitioners

Alabama Power Co., et al.

February 28, 1984

Witson - Eras Prinrine Co.. Inc. - 769-0096 - Wasnincron, D.C. 20001

QUESTIONS PRESENTED

1. Whether, instead of independently construing tech-

nical statutory terms—terms that will determine if a

State must use contrary-to-fact “stack height” assump-

tions in revising its State Implementation Plan under

§110 of the Clean Air Act—the Court of Appeals

was required to give “legislative effect” to EPA’s rule

making application of those terms when § 123 of the

Clean Air Act specifically directs that their meaning

be determined by EPA through rulemaking?

2. Whether the Court of Appeals was correct in order-

ing EPA to disregard historical engineering practice and

to develop “Good Engineering Practice” (GEP) rules

that will require comprehensive State Implementation

Plan revisions, when the legislative history of § 123 in-

dicates that EPA could rely on historical practice in

defining GEP and when such State Implementation Plan

revisions

(a) are not needed to assure compliance with the

public health and welfare-based ambient air

quality standards;

(b) will impose great complexities on the already

complex air pollution control programs being ad-

ministered by the States; and

(ce) could require fuel switching, new control tech-

nologies or both, costing hundreds of millions of

dollars?

8. Whether the Court of Appeals (which clearly mis-

understood the effect of EPA’s “plume impaction” rule)

was correct in ordering EPA to require the States to use

contrary-to-fact assumptions that only apply to sources

located in hilly or mountainous parts of the country, when

the consequences of using such contrary-to-fact assump-

tions were never considered by Congress in enacting § 123

and when the use of these assumptions will result in State

Implementation Plan revisions which will

(a) in the words of the Court of Appeals, “harshly

discriminate” against both existing facilities and

(i)

ii

new development in hilly or mountainous regions

of the country; and

(b) impose pollution control costs that are billions of

dollars more than the costs associated with the

emission limitations that would be required for

identical, or even more polluting, sources located

in flat terrain?

PARTIES TO THE PROCEEDING

This case involves challenges to final regulations pro-

mulgated by EPA under § 123 of the Clean Air Act, 42

U.S.C. § 7423. Sierra Club and Natural Resources De-

fense Council (NRDC) were petitioners in Case Nos. 82-

1384 and 82-1845. The Commonwealth of Pennsylvania

was petitioner in Case Nos. 82-1412 and 82-1889. These

cases were consolidated on August 18, 1982. The U.S.

Environmental Protection Agency was the Respondent in

all of these proceedings. Petitioners, Alabama Power Co.,

66 other individual electric utilities,* the Edison Elec-

tric Institute, the National Rural Electric Cooperative

Association, and the American Public Power Association

intervened on behalf of Respondent EPA in all of these

proceedings. The American Petroleum Institute, Gulf

Oil Co., Shell Oil Co., Standard Oil Co. (Indiana) and

Texaco Co. also intervened on behalf of Respondent in

all of these proceedings. Kennecott Minerals Co. and

Tennessee Valley Authority intervened on behalf of Re-

spondent EPA in Case No. 82-1384. The State of Ver-

mont, the State of New York, the Commonwealth of

Massachusetts, the State of Rhode Island and the State

of New Hampshire intervened jointly on behalf of Pe-

titioners Sierra Club and NRDC in Case No. 82-1354.

These states also intervened on behalf of the Common-

wealth of Pennsylvania in Case No. 82-1412.

* A liet including the names of the individual companies that

comprise Petitioners Alabama Power Co., et al., and all parent

companies, subsidiaries, and affiliates is contained in the supple

mental appendix attached to this Petition pursuant to Rule 28 of

this Court.

TABLE OF CONTENTS

QUESTIONS PRESENTED ..................00.0.ssssessesssesesseveese

PARTIES TO THE PROCEEDING ...... hiseteneeesnasatalinaaai

ee ee

OPINIONS BELOW ...................... jeansligesiaegiinidicnpinaaaiaan

JURISDICTION ......... higulitansneiatenlian asscenaevivddsainpabibaoet

STATUTORY AND REGULATORY PROVISIONS

II cxicinisictecicchnctehsicsbeientiencsesninecaneciablettauicibaidy caitaniaiiah

STATEMENT OF THE CASE....................... shaekotuiiitiiean

i EE ie eee Omen

A. The Long-Standing Staidiiee: and Regula-

II.

III,

tory Practice ............ sa dahnielitidceabsasddeesiaaiiediie

THE EPA RULEMAKING 000000... eeeceeeeeeee

A.

af ep

The 1979 Proposals and the Subsequent Re-

ID "ica doctendbesticcemntincesnassnbinissnidacotancideec

1

2. “Excessive Concentrations”

3

Se BN Sittcohcetiesiccntstttnciocaeennn

TAUNTON adiailtnctansterathdnstasdoalvdbbebiaddninuitaeadd

PEED CITE scocsinithiniciiccinsttetiinasatihdlehiitiabes

Requirements on Remand ..000000000..0..-.ccccceeeeees

(iii)

iv

TABLE OF CONTENTS—Continued

REASONS FOR GRANTING THE WRIT ....................

I, THE D.C. CIRCUIT’S REJECTION OF EPA’S

II.

ITI.

IV.

RULEMAKING IMPLEMENTATION OF

“GOOD ENGINEERING PRACTICE” VIO-

LATES THE DECISION OF THIS COURT IN

HERWEG v. RAY THAT AN AGENCY’S

DEFINITION OF TECHNICAL TERMS IN

ITS ENABLING LEGISLATION MUST BE

GIVEN “LEGISLATIVE EFFECT” ..................

EPA’S INTERPRETATION OF TECHNICAL

STATUTORY TERMS WAS “SUFFICIENTLY

REASONABLE” TO PRECLUDE THE D.C.

CIRCUIT FROM SUBSTITUTING ITS JUDG-

MENT FOR THAT OF THE AGENCY .............

THE D.C. CIRCUIT EXCEEDED ITS AU-

THORITY AS A REVIEWING COURT BY

REQUIRING EPA TO APPLY ITS GEP

RULES TO SOURCES IN RUGGED TERRAIN

IN A MANNER NEVER CONSIDERED BY

CPD wietinssicssovicisisiciiacineissnnjiiiedntesimaniaaiessniiatan

THE D.C. CIRCUIT’S DECISION WILL SERI-

OUSLY RESTRICT ECONOMIC GROWTH IN

MANY AREAS OF THE COUNTRY AND

WILL GREATLY COMPLICATE ADMINIS-

TRATION OF THIS NATION’S SYSTEM OF

AIR QUALITY REGULATION .................

ICG ssseneniieensraicictncsieniiin siibiiateiliiesiiiniiainans —

Page

16

18

20

v

TABLE OF AUTHORITIES

CASES: Page

American Tobacco Co. v. Patterson, 456 U.S. 68

Ee MLS IOS le: 26

Batterton v. Francis, 482 U.S. 416 (1977) .............. 19

Beal v. Doe, 482 U.S. 488 (1977) .........-....--c0ccec-eeeeee 22

Big Rivers Electric Corp. v. EPA, 528 F.2d 16 (6th

Cir. 1975), cert. denied, 425 U.S. 984 (1976)........ 7

Black Citizens for a Fair Media v. FCC, 719 F.2d

dS Re 17

Chevron U.S.A., Inc. v. NRDC, Noa. 81-1005, et al.,

cert. granted, 108 S.Ct. 2427 (1988) .................... 8,4

Citizens to Save Spencer County v. EPA, 600 F.2d

UE 26

Corning Glass Works v. Brennan, 417 U.S. 188

EST at gt AA El 21

Democratic Senatorial Campaign Comm. v. FEC,

660 F.2d 773 (D.C. Cir. 1980), rev’d, 454 U.S.

RE ERED Ean 5 17

FCC v. Pottsville Broadcasting Co., 309 U.S. 184

EE Se 26

FEC v. Democratic Senatorial Campaign Comm.,

BETES SE 19

Fri v. Sierra Club, 412 U.S. 541 (1978) —......00....... 8

Herweg v. Ray, 455 U.S. 265 (1982)... 17, 19, 20

INS v. Wang, 450 U.S. 189 (1981) ...........................+- 22

Investment Company Institute v. Camp, 401 U.S.

RNG LSet a a eR 22

Kennecott Copper Corp. v. EPA, 526 F.2d 1149 (9th

Cir. 1975), cert. denied, 425 U.S. 935 (1976)...... 7

Montana Power Co. v. EPA, Nos. 76-529, et al.,

cert. granted, 480 U.S. 958 (1977), vacated and

remanded, 434 U.S. 809 (1977). 8

National Wildlife Federation v. Gorsuch, 698 F.2d

I ees 18

NRDC v. EPA, No. 81-2001 (D.C. Cir. January 17,

ST Sn ene 16

NRDC v. EPA, 529 F.2d 755 (5th Cir. ET 6, 7

NRDC v. EPA, 489 F.2d 890 (5th Cir. 1974) ......... 7

Public Service Comm'n v. Mid-Louisiana Gas Co.,

108 S. Ct. 3024 (1988) ... ; 18, 26

vi

TABLE OF AUTHORITIES—Continued

Page

Rose v. Lundy, 455 U.S. 509 (1982) .........0......0 25

Schweiker v. Gray Panthers, 458 U.S. 34 (1981)... 19

Sea-Land Service, Inc. v. Kreps, 566 F.2d 768 (D.C.

RRR AERP a aaa ae A pC 25

Sierra Club v. Costle, 719 F.2d 486 (D.C. Cir.

END SRT PEC eee eae ee EIT passim

Sierra Club v. Gorsuch, C.A. No. 81-0094 (D.D.C.

ial A REST et OBR 11

South Prairie Construction Co. v. Operating Engi-

00076, 4B5 U.B. GOO (176) .....crcccccccccccccccsccccsoceceses 26

Train v. NRDC, 421 U.S. 60 (1975) ............. 8, 4, 17, 20, 29

Union Electric Co. v. EPA, 427 U.S. 246 (1976).... 3,4,

20, 29

STATUTES:

pL ES Ce eae 17

os Ta es | Sanne 2

f ‘eg aa Ce 17

The Clean Air Act, 42 U.S.C, § 7401, et seq. (Supp.

V 1981)

§ 101(b) (1), 42 U.S.C. § 7401(b) (1) (Supp.

ch

§ 108, 42 U.S.C. § 7408 (Supp. V 1981) ....... 4

§ 109, 42 U.S.C. § 7409 (Supp. V 1981) ....... 4

§ 110, 42 U.S.C. § 7410 (Supp. V 1981) ....... passim

§ 128, 42 U.S.C. § 7428 (Supp. V 1981) ....... passim

§ 128(a) (1), 42 U.S. C. § 7423(a) (1) (Supp.

i RP ae. Pe a 8, 18

§128(c), 42 U.S.C. §7428(c) (Supp. V

BED heecehetiedblashcetllteeciesiinhnoeietadntehatechdietidssamananed 8, 20, 24

§ 163, 42 U.S.C. § 7478 (Supp. V 1981) ......... 4, 27

§ 165 (d) (2) (D) (iii)-(iv), 42 U.S.C. § 7475

(d) (2) (D) (iii)-(iv) Supp. V 1981).......... 26

§ 169, 42 U.S.C. § 7479 (Supp. V 1981) .......... 18

§807(b), 42 U.S.C. §7607(b) (Supp. V

RIES re ee IY 17

§ 807(b) (1), 42 U.S.C. § 7607(b) (1) (Supp.

1 <PEEOD bdicsisdeedeadiebteciiasott np tnildcececiitialetadlons adlboddoels 1

§820(a), 42 U.S.C. §7620(a) (Supp. V

1981) 28

47 U.S.C. § 402(b) (1976) 17

vii

TABLE OF AUTHORITIES—Continued

REGULATIONS: Page

40 C.F.R. §51.1(z), (ff)-(mm) (1988) ................. passim

40 C.F.R. § 61.12(j)-(1) (1988) .............000 passim

— Bok TB). | a Cee passim

Cie ND SCD casectctsevenscrvecnsereccesscerese 9

FEDERAL REGISTER:

88 Fed. Reg. 25697, et seq. (1978) ....ccccccccccccccceee 6,7

41 Fed. Reg. 7450, et seg. (1976) ...............00.. 6

42 Fed. Reg. 57459, 57460 (1977) ........0.............. 9

44 Fed. Reg. 2608, et seq. (1979) 0.0... 9

46 Fed. Reg. 49814, et seq. (1981) ......000000000.... 11, 28

47 Fed. Reg. 5864, et seg. (1982) ...........000.000000 passim

MISCELLANEOUS:

H.R. Rep. No, 294, 95th Cong., Ist Sess. (1977),

reprinted in, The Environmental Policy Division

of the Congressional Research Service of the

Library of Congress, A Legislative History of

the Clean Air Act Amendments of 1977 (1978) ..passim

8.768, 98th Cong., lst Sess. (1983) 0.000... 8

Washington Post, February 3, 1984, A17, col. 1...... 8

IN THE

Supreme Court of the United States

OCTOBER TERM, 1983

No. 83-

ALABAMA POWER Co., et al.,

Petitioners,

Vv.

SIERRA CLUB, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Alabama Power Co., 66 other individual electric utili-

ties,’ the Edison Electric Institute, the National Rural

Electric Cooperative Association, and the American Pub-

lic Power Association, respectfully petition for a writ of

certiorari to review the judgment of the United States

Court of Appeals for the District of Columbia Circuit en-

tered in this proceeding on October 11, 1983.?

1 The 67 individual utility petitioners and their parent companies,

subsidiaries, and affiliates are set forth in the supplemental appendix

attached to the petition pursuant to Rule 28 of this Court.

2 The court below had jurisdiction of these cases under § 307

(b) (1) of the Clean Air Act, 42 U.S.C. § 7607(b)(1) (Supp. V

1981), which provides the District of Columbia Circuit with ex-

clusive jurisdiction to review any “nationally applicable regulations

. +» promulgated by the Administrator... .”

2

OPINIONS BELOW

The opinion in the Court of Appeals in Sierra Club,

et al. v. EPA, Nos. 82-1884, 82-1412, 82-1845, 82-1889

(D.C. Cir. October 11, 1983), is reported at 719 F.2d

436. A copy of the opinion appears in the Appendix

hereto (hereinafter referred to as “App. ——’’) at la-

69a.

JURISDICTION

The judgment of the Court of Appeals for the D.C.

Circuit was entered on October 11, 1983. A timely Peti-

tion for Rehearing and Suggestion for Rehearing En

Banc were denied on December 13, 1983, App. 70a, 72a,

and this petition for certiorari is being filed within 90

days of that date. This Court’s jurisdiction is invoked

under 28 U.S.C. § 1254(1) (1976).

STATUTORY AND REGULATORY

PROVISIONS INVOLVED

The following statutory and regulatory provisions are

set forth in the Appendix:

1. Clean Air Act §§101, 110(a) (1)-(a) (2) (J),

123, 42 U.S.C. §§ 7401, 7410(a) (1)-(a) (2) (J),

7423 (Supp. V 1981), App. 106a-111a.

2. 88 Fed. Reg. 25697, et seq. (1973) (Initial Guid-

ance on Use of Supplementary Control Systems),

App. 103a-105a.

8. 47 Fed. Reg. 5864, et seg. (1982) (Final Stack

Height Rules), 40 C.F.R. § 51.1(z), (ff)-(mm),

§ 51.12(j)-(1), §51.18(1) (1988), App. 80a-102a.

STATEMENT OF THE CASE

Section 110 of the Clean Air Act establishes a federal-

state partnership to implement federal ambient air qual-

ity requirements. Since the Clean Air Act was amended

in 1970 to initiate this exercise in federalism, this Court

has been requested on five occasions to review decisions

of the Courts of Appeals that have called upon EPA to

redirect aspects of the federal-state clean air program.

Each of these cases involved one or more decisions by the

Courts of Appeals rejecting EPA’s interpretation of its

obligations under $110. Reflecting the importance of

such cases to the federal government and to each of the

50 states which are bound by EPA guidance, certiorari

was granted in each instance.*

The decision of the Court of Appeals for the District

of Columbia Circuit in this case, like the other five cases

in which this Court has granted certiorari, calls into

question the continuation of the current federal-state

system of implementing ambient air quality require

ments. In the exercise of its exclusive jurisdiction under

the Clean Air Act, the court below has required EPA to

rewrite very technical regulations dealing with the

amount of “stack height” that can be assumed by the

states in setting emission limitations in the “implemen-

tation plans” required under § 110 of the Act. While the

subject matter may be arcane, the social and economic

consequences that flow from the court’s decision are

staggering, equaling or surpassing those presented in

previous cases reviewed by this Court.

If the decision of the court below is allowed to stand,

air quality regulation in the fifty states will undergo a

dramatic redirection as the states are required to sub-

stitute false stack height assumptions for actual stack

height. As a result, abatement of real pollution prob-

lems will no longer be the primary focus of state air

pollution programs. Instead, the states will be required

* One case resulted in affirmance by an equally divided court.

Fri v. Sierra Club, 412 U.S. 541 (1978). One never reached deci-

sion. Montana Power Co. v. EPA, Nos. 76-529, et al., cert. granted,

430 U.S. 953 (1977), vacated and remanded, 434 U.S. 809 (1977).

One is awaiting decision. Chevron U.S.A., Inc. v. NRDC, Nos. 81-

1005, et al., cert. granted, 108 S.Ct. 2427 (1983). The remaining

two resulted in opinions rejecting Circuit Court decisions that failed

to defer to EPA’s construction of the Act. Train v. NRDC, 421 U.S.

60 (1975); Union Electric Co. v. EPA, 427 U.S. 246 (1976).

4

to develop emission limitations for existing sources and

to regulate new source growth on the basis of theoretical,

not actual, ambient pollution concentrations predicted by

falsely assuming that emissions are released from a short

smokestack. Not only will this judicially-imposed shift

in focus entail the imposition of substantial economic

costs, but it will make administration of ambient air

quality programs of the states infinitely more complex.

See infra pp. 27-29.

The District of Columbia Circuit’s decision in this case

thus calls for a more fundamental revision of § 110

regulatory programs than is involved in the Chevron

case that is currently pending before this Court (Nos.

82-1005, et al.). It presents as extreme a restriction on

the discretion of the states to revise emission limitations

as was involved in Train v. NRDC, 412 U.S. 60 (1975).

It calls for the imposition of emission controls without

regard to costs, as required by Union Electric, but in a

setting which lacks the public health justifications under-

lying this Court’s holding in Union Electric, 427 US.

246, 258-59 (1976). As explained below, the need for

review here is as compelling as it was in any of the prior

cases accepted by this Court.

I. THE STATUTE

The Clean Air Act‘ establishes a system of air qual-

ity regulation that is based upon “National Ambient Air

Quality Standards” (“ambient standards”) and Preven-

tion of Significant Deterioration (“PSD”) “increments”.*

* 42 U.S.C. $§ 7401, et seg. (Supp. V 1981) (hereinafter referred

to as “CAA” or “the Act”). (For convenience, all further citations

will be to the Act. Parallel citations to the U.S. Code are given in

the Table of Authorities.)

5 The ambient standards define maximum ground level concentra-

tions of pollution which, if attained, will assure protection of public

health and welfare. CAA $§ 108, 109. The PSD increments define

the maximum increases in ground level concentrations that are

allowed to occur as a result of new consiruction in areas where the

ambient standards are met. CAA § 163.

5

Under $110 of the Act, the states must set emission

limitations for individual sources to ensure that their

emissions will not cause or contribute to ground level

pollution concentrations that exceed the ambient stand-

ards or PSD increments.

Dispersion of pollution after release from a source

and before it reaches ground level is essential to the

operation of the § 110 federal-state programs. If there

were no dispersion, it would not be possible to operate

any industrial fuel burning facility without creating

pollution concentrations that exceed ambient air quality

standards and PSD increments by factors of many

thousand.* In other words, industrial activity and pro-

tection of the public health could not co-exist without

dispersion. Dispersion, therefore, will determine the type

of fuel a source can use, what control technologies it

must install, and where it can be built.

Section 123 of the Act was added in 1977 and ad-

dresses a question which goes to the heart of the § 110

system of air quality regulation—when must the states

assume that a source’s emissions will reach the ground

in a less dispersed (i.e., more concentrated) condition

than is happening in fact? If this false dispersion as-

sumption is broadly applied, state air quaiity regulation

will shift its focus from actual pollutant concentrations

to wholly theoretical ones.

A. The Long-Standing Engineering and Regulatory

Practice

Engineering standards have traditionally required that

industrial facilities build stacks tall enough to avoid

*For example, if the emissions from a well-controlled source

(e.g., a power plant meeting the stringent EPA new source stand-

ards) were released at ground level, they would create ambient

concentrations of sulfur dioxide (SO,) in the range of 900,000

micrograms per cubic meter. By comparison, the primary (public

health) ambient standard for SO, is 365 micrograms per cubic

meter (24-hour calendar day average), and the Class [I PSD incre-

ment is 91 micrograms per cubic meter (24-hour calendar day

average).

6

atmospheric turbulence which could drive the concen-

trated emissions plume directly to the ground (a phe

nomenon called “downwash’’). As early as the 1930s,

sources built stacks based upon a conservative “good en-

gineering practice” (GEP) formula that required stacks

in flat terrain to be built to a height equal to at least 2.5

times the height of the source in order to avoid excessive

ground level concentrations caused by downwash.” In

mountainous terrain, additional stack height was often

necessary to avoid excessive concentrations due to down-

wash caused by terrain obstacles.* Although most sources

followed these engineering principles in designing stacks,

larger-than-GEP smokestacks were built by certain

sources in order to obtain more dispersion and hence re-

laxed emission limitations.

To eliminate the pollution control advantages that

might be associated with building stacks taller than

GEP height, EPA adopted the traditional GEP concept

in regulatory guidance issued in response to litigation in

1973,° and revised in 1976."° Under the 1973 guidance,

a source could automatically increase stack height up to

2.5 times source height and the states could use that

stack height in determining emission limitations under

$110. The guidelines further noted that a source in

rugged terrain might need stack height greater than 2.5

7 See, e.g., Briggs, Gary A., Plume Rise, Oak Ridge: U.S. Atomic

Energy Commission (1969) ; U.S. Environmental Protection Agency,

Guideline for the Determination of Good Engineering Practice

Stack Height (Technical Support Document for the Stack Height

Regulations) (July 1981, with addendum of December 15, 1981)

(hereinafter referred to as “GEP Guidelines”) at 7-9, Appendix A.

See also EPA 1978 Stack Height Guidelines, 88 Fed. Reg. 25697,

25700 (1978), App. 108a-104a.

® GEP Guidelines at 24-26, Appendix A.

*38 Fed. Reg. 25697, et seg. (1978), App. 108a-105a.

10 41 Fed. Reg. 7450, et seq. (1976) ; see NRDC v. EPA, 529 F.2d

766, 760 (Sth Cir. 1976).

7

times source height to prevent problems associated with

reduced dispersion caused by rugged terrain."

B. The Clean Air Act Amendments

Congress added § 123 to the Clean Air Act in 1977 in

order to codify the court decisions * and pre-existing

regulatory guidance on GEP stack height."* Under § 123,

a state must assume that a source’s emissions are re-

leased from a stack that is no higher than GEP height

whenever actual stack height exceeds GEP height. Thus,

if an actual stack is found to be taller than GEP, emis-

sion limitations for that source and surrounding sources

must be based upon the theoretical, more concentrated

ground level pollution that would result from assuming

the shorter GEP stack height.

Congress’ objectives in adding § 123 to the Act were

two-fold. On the one hand, Congress wanted to provide a

clear statutory basis for the principle that sources that

had built stacks higher than GEP height could not

obtain relaxed emission limitations based upon the

greater dispersion to ground level associated with such

tall stacks.“ On the other hand, Congress wanted to

11 88 Fed. Reg. 25700 (1973), App. 104a.

12 NRDC v. EPA, 529 F.2d 755 (5th Cir. 1976) ; Big Rivers Elec-

tric Corp. v. EPA, 528 F.2d 16 (6th Cir. 1975), cert. denied, 425

U.S. 984 (1976); Kennecott Copper Corp. v. EPA, 526 F.2d 1149

(9th Cir. 1975), cert. denied, 425 U.S. 985 (1976); NRDC v. EPA,

489 F.2d 390 (5th Cir. 1974).

18 See H.R. Rep. No. 294, 95th Cong., 1st Sess. 93 (1977),

reprinted in, The Environmental Policy Division of the Congres-

sional Research Service of the Library of Congress, A Legislative

History of the Clean Air Act Amendments of 1977 2560 (1978)

(hereinafter referred to as “1977 Legis. Hist.’’)

14 Jd. Congress, as reflected in the House Report, was concerned

that if it allowed sources to use greater-than-GEP stack height

(i.e., tall stacks) as an alternative to emission controls, a number of

adverse consequences might ensue. Congress discussed “long range

transport” and “acid rain” in this regard. It should be emphasized

make it clear in § 123 that the amount of dispersion to

ground level associated with GEP stack height should

be credited in setting emission limitations."° In other

words, § 123 reflects Congress’ understanding that the

amount of dispersion associated with GEP stack height

was integral to any proper emissions control program."*

In $123, Congress directed that GEP be “deter-

mined under regulations promulgated by the Adminis-

trator.” CAA 3 123(a)(1), App. 110a. Three general

criteria were set forth by Congress to guide the Agency in

its exercise of this broad grant of rulemaking authority.

First, Congress directed that GEP be defined in a

manner “to insure” that “nearby” structures or terrain

will not create downwash that “result/s] in excessive con-

centrations of any air pollutant.” CAA §128(c) (em-

phasis added), App. llla. The meaning of technical

terms underlying the GEP concept (such as “excessive

concentrations” and “nearby”) were to be “determined

by the Administrator,” subject to the conservative “to

insure” standard. Id. Second, Congress specified that GEP

that these “adverse effects” cited in the House Report were those

that would, it was believed, flow from abandoning emission controls

in favor of increased tall stack dispersion. In other words, this

legislative history explained why Congress was codifying past pruc-

tice in § 128 rather than repealing it. See H.R. Rep. No. 95-294 at

84-88, 98, 1977 Legis. Hist. at 2551-555, 2560. It should also be

emphasized that § 123 is not written to require the development of

any kind of rational “long range transport” or “acid rain” control

measures. Rather, § 123 requires that emission limitations be set in

terms of theoretical, local concentrations, and not the far-field down-

wind deposition that is asserted to have a public health or welfare

significance. Indeed, the Administration and Congress are presently

in the throes of addressing the need for acid rain legislation. See

8.768, 98th Cong., 1st Sess. (1983) ; Washington Post, February 38,

1984, at A17, col. 1.

18 H.R. Rep. No. 95-294 at 98, 1977 Legis. Hist. at 2560.

16 Jd.; see supra note 6 and accompanying text.

9

rules may not allow stack height credit in excess of “two

and a half times the height of such source [the “histori-

cal” GEP formula] unless the owner or operator...

demonstrates ... that a greater height is necessary” to

avoid excessive concentrations due to downwash. /d. (em-

phasis added). Third, Congress ordered that “[i]n no

event may the Administrator prohibit any increase in

any stack height or restrict in any manner the stack

height of any source.” Id.

Il. THE EPA RULEMAKING

After enactment of the 1977 Amendments, EPA an-

nounced in November 1977 that the traditional “good

engineering practice” standard of 2.5 times source height

would be applied to new and existing sources pending the

development of regulations under §123 of the Act.”

The rulemaking to implement § 123 was initiated in

January 1979. At that time, EPA proposed a radical

change in the definition of “good engineering practice.”

A. The 1979 Proposals and the Subsequent Reevaluation

EPA’s January 1979 proposals would have required

many sources that had made commitments based upon

the traditional 2.5 rule to recalculate stack height credit

based upon costly case-specific demonstrations.’* The

proposals would also have severely restricted the in-

stances in which sources in mountainous terrain could

demonstrate that terrain obstacles caused unacceptable

downwash."* These and other aspects of the proposals

would have vastly increased the number of instances in

which false stack height assumptions would have had to

1142 Fed. Reg. 57459, 57460 (1977); see 40 C.F.R. § 51.24(h)

(1988).

18 See 44 Fed. Reg. 2608, 2610-11 (1979); see Comments of the

Utility Air Regulatory Group (April 8, 1979) at 15-22.

19 44 Fed. Reg. at 2611, 2614.

10

be used in setting emission limitations under state im-

plementation plans.”

Industry and states strongly criticized these initial

proposals. Their rulemaking comments showed that

EPA’s departure from established engineering principles

would cost industry and consumers billions of dollars to

meet new emission limitations based upon false stack

height assumptions.*' Furthermore, these comments

showed that the proposals would economically discrimi-

nate against sources in mountainous and hilly terrain

by requiring them to meet emission limitations ten times

more stringent than emission limitations for identical

sources in flat terrain.” Finally, these cominents showed

that these rules would have imposed substantial admin-

istrative burdens on the states. See infra pp. 27-29.

Based upon these comments, the schedule for promul-

gation of final rules was suspended while EPA con-

ducted additional analyses of the impacts of its § 123

proposal. EPA’s consultant issued a report in August

1980 that found that the 1979 proposals would have re-

sulted in increased capital costs of up to $2.8 billion and

20 See ICF, Inc., Economic Impact of Tall Stack Regulations

(June 1981) (appended to Comments of the Utility Air Regulatory

Group (June 16, 1981)); EEA, Inc., Cost and Economic Impact

Analysis of the Proposed Stack Heights Regulation (August 15,

1980) at 10-17, App. 182a-129a (hereinafter referred to as “1980

Impact Assessment”); Comments of the Utility Air Regulatory

Group (April 8, 1979) at 6-29.

21 See, e.g., Comments of Monsanto Co. (March 9, 1979) at 2;

Comments of Gulf States Utilities Co. (March 8, 1979) at 1-2;

Comments of the State of New Jersey Department of Environmen-

tal Protection (March 12, 1979) at 1-2; Comments of the State of

Maryland Department of Environmental Health Administration

(February 28, 1979) at 1.

22 See, e.g., Environmental Research and Technology, Analysis of

EPA Proposed Regulations on Stack Height Limitation (March

1979) (submitted as Appendix C to Comments of the Utility Air

Regulatory Group (March 1979)) at 14-20, App. 116a-122a; see

infra notes 52 & 53.

11

increased annual costs of up to $794 million for utilities

alone, and in rate increases of up to 26% for individual

utilities. Additional costs would have been imposed on

utilities in mountainous terrain. See infra note 52.

In light of the rulemaking comments and its own addi-

tional analyses, EPA reproposed new rules in October

1981,% pursuant to a court order that required promulga-

tion of final rules by January 1982.% The reproposed

rules more closely paralleled the traditional engineering

and regulatory concept of “GEP” stack height.

B. The Final Rules

In February 1982, EPA promulgated final rules that,

like the reproposed ;ules, are consistent with traditional

engineering and reguiatory practice.

1. The “GEP Formula”—EPA’s final rules adopt the

traditional GEP formula to govern dispersion credits for

stacks in existence before January 12, 1979 (the date of

the initial EPA proposals), and adopt a refinement of the

traditional 2.5 times source height rule (called the

“141.5” rule) for stacks that are built after this date.

EPA concluded, based upon the extensive record it had

compiled,”* that these formulas would yield a stack of

sufficient height “to insure” that excessive concentrations

due to downwash would be avoided.?’

23 1980 Impact Assessment at 10-18, App. 128a-129a.

24 46 Fed. Reg. 49814, et seq. (1981).

25 Sierra Club v. Gorsuch, C.A. No. 81-0094 (D.D.C. Aug. 20,

1981).

2* During § 123 rulemaking, EPA developed thousands of pages

of documents in analyzing various aspects of the proposed and final

rules. Over 100 commentators filed comments discussing various

portions of the proposed rules. Public hearings were held that

produced hundreds of additional pages of transcript and testimony.

27GEP Guidelines at 2, Appendix A; 47 Fed. Reg. 5864, 5865

(1982), App. 84a.

12

2. “Excessive Concentrations”—The final rules provide

that credit above GEP formula height may be obtained

only if the affected source makes a specific showing that

the formulas fail to allow enough stack height credit “to

insure” against “excessive concentrations” due to down-

wash.”* “Excessive concentrations,” a statutory term, is

defined as a substantial “percentage increase” (i.e., 40

percent) in ambient concentrations caused by downwash.

This definition reflects the historical engineering and reg-

ulatory notion of a maximum acceptable downwash condi-

tion.”

8. “Nearby’”—The statute provides that “excessive con-

centrations” must result from downwash caused by “near-

by structures” or “nearby terrain obstacles.” In accord-

ance with the common understanding of the term, EPA

defined “nearby” as a relative concept that is dependent

upon the size of the object. Since larger objects will cause

severe downwash at greater distances, EPA compiled an

extensive record on the relationship between downwash

and the obstacles that might produce it.” In the case of

buildings and other manmade structures which are char-

acterized by regular shapes and sizes, EPA was able to

define “nearby structures” by a formula: “5 times” the

height or width of the structure, up to % mile.” Since

terrain obstacles are much larger than buildings and have

irregular shapes, EPA found that unacceptable downwash

could extend for much greater distances. EPA could not

determine a precise fyrmula, however, and therefore de-

28 See GEP Guidelines at 20-28; 47 Fed. Reg. at 5865, App. 84a-

87a (1982).

2% See GEP Guidelines at 20-23; J.E. Cermak and R.L. Petersen,

Comments on the Proposed Regulations of 7 October 1981 to Imple-

ment Section 123 of the Clean Air Act (November 1981) at 1-8 (Ap-

pended to Comments of the Utility Air Regulatory Group (Novem-

ber 18, 1981)).

% See GEP Guidelines at 5-15, 24-26.

81 47 Fed. Reg. at 5869, App. 100a.

18

fined a “nearby terrain obstacle” as one that is demon-

strated through a fluid modeling study to be close enough

to the source to cause at least a 40 percent increase in

local ambient concentrations due to downwash.”™

4. “Plume Impaction”—EPA included in these rules

a provision that governs development of GEP emission

limitations in mountainous or hilly terrain. This pro-

vision—called the “plume impaction” rule—requires emis-

sion limitations for rugged terrain sources to be set using

GEP stack height assumptions. It permits such sources,

however, to adjust the terrain height assumption in the

atmospheric dispersion model that must be used to estab-

lish a GEP emission limitation. See infra note 60. This

adjustment is necessary to avoid predictions showing

plume impaction (i.e., a concentrated plume drifting into

elevated terrain rather than reaching ground level after

dispersion) that could never occur in reality." Under

this rule, the GEP-based emission limitation governs un-

less the use of actual terrain height and actual stack

height would require a more restrictive emission limita-

tion. See infra pp. 22-23.

Ill. THE D.C. CIRCUIT’S DECISION

On October 11, 1983, the D.C. Circuit set aside virtually

every significant portion of EPA’s § 123 regulatory pro-

gram. The court found that since “Congress appears to

have taken the main elements of [the 1973 EPA guid-

ance] statement in its definition of good engineering prac-

tice height,” App. 9a, 10a, EPA’s construction of § 128

seemed to reflect what Congress “probably had in mind.”

App. 42a-48a. Nonetheless, the court rejected EPA’s re-

liance upon historical practice because such reliance would

not carry out what the court asserted was the “pre-

52 Id. at 5865, 5868-69, App. 86a, 100a; GEP Guidelines at 47-48.

%3 See GEP Guidelines at 4, 560-51, addendum of December 15,

1981; 47 Fed. Reg. at 5866-67, App. 90a-94a.

14

dominant purpose” of § 123—to force emission reductions

through the use of false stack height assumptions.™

As enunciated by the court, “two precepts are the heart

of [its] holding” on GEP stack height. App. 28a. First,

in defining GEP, the court held that EPA was wrong in

adopting “a conservative [GEP] rule that was absolutely

sure to eliminate health hazards.” Instead, the court held

that EPA must justify its GEP rules “independent of”

historical engineering practice. Jd. Second, where there

is a choice between definitions of a term, the court di-

rected EPA always to “err on the side of reducing stack

height.” Jd.

1. The “GEP” Formula—Based upon its independent

reading of § 123, the court set aside EPA’s rule estab-

lishing a “GEP formula” on which sources could rely in

building stacks and the states could rely in setting emis-

sion limitations. It held that since EPA’s regulation de-

fining a GEP formula might, in some cases, provide more

protection against downwash than is needed, “[r]ation-

ality demands” that EPA require case-specific showings

that its rule does not provide too much protection against

unacceptable downwash. Alternatively, EPA must estab-

lish a GEP formula that never provides for too much

protection. App. 46a-47a.

2. “Excessive Concentrations”—The court set aside

EPA’s definition of “excessive concentrations,” finding

that although it was “likely . . . that Congress thought

* App. 18a. The court also characterized § 123 generally “as

something of a concession from the strict command that dispersion

not be used to meet air quality standards.” Jd. (emphasis added).

No support is cited in the statute or the legislative history for

either this characterization or the court’s conclusion regarding

§123’s “predominant purpose.” Indeed, the “strict command”

against dispersion discovered by the court reflects a fundamental

misunderstanding of the principles underlying good air quality

management since without dispersion there could be no industrial

activity. See supra note 6 and accompanying text.

15

traditional engineering practice” would be followed,

EPA’s definition had not been justified “independent of”

historical notions of adverse downwash conditions. App.

18a-28a.

8. “Nearby”—The court affirmed EPA’s definition of

‘nearby structures” but set aside EPA’s definition of

“nearby terrain obstacles,” holding that regardless of the

factual record on the downwash effects of very large ter-

rain obstacles, a rigid distance definition (e.g., “4% mile’’)

was both in keeping with the “strict command [of § 123]

that dispersion not be used to meet air quality standards,”

and would further the court’s assumed § 123 objective of

“reducing emissions.” App. 13a-18a. Although the lower

court noted that this interpretation reflected “an element

of arbitrariness,” App. 18a, it justified its reading of the

statute as not “‘utterly nonsensical.” App. 16a.

4. “Plume Impaction”—The lower court set aside

EPA’s plume impaction rule. While the court admitted

that its holding would “discriminate[] harshly against

utilities located in mountainous terrain” and that Con-

gress did not “focus on, and resolve” the problem re-

dressed by EPA in the rule, App. 37a, 38a, the court

concluded that its holding was “not utterly irrational”

because elimination of the plume impaction rule would

once again reduce dispersion credit. App. 39a; infra

pp. 24-25.

5. Requirements on Remand—Having dismantled

EPA’s § 123 regulatory program, the D.C. Circuit imposed

upon EPA, without briefing and argument, a six month

deadline ™ to promulgate a new § 123 program, and im-

posed upon the states a nine month deadline to implement

fully EPA’s revised program. In imposing the six month

deadline upon EPA, the court suggested that the rulemak-

%§ This schedule begins upon issuance of the mandate (App. 68a),

which has been stayed by the court pending the filing of this

Petition.

16

ing could be completed within this time by reverting to

the 1979 proposals, since “the flaws we have found in

EPA’s regulations were reversals of positions taken in the

1979 proposed regulations.” App. 68a-69a.

On November 25, 1983, Petitioners filed a timely Peti-

tion for Rehearing and Suggestion for Rehearing En

Bane. These were both denied on December 13, 1983.

App. 70a-78a.

REASONS FOR GRANTING THE WRIT

Section 123 of the Clean Air Act calls upon the states

to use “good engineering practice stack height” assump-

tions when establishing emission limitations under § 110

of the Act, and expressly delegates to EPA the authority

to adopt rules that define GEP for the states. After

lengthy rulemaking, EPA adopted GEP rules which de-

fine technical statutory terms in light of historical engi-

neering and regulatory practice. The court below re-

jected EPA’s rules without giving any deference what-

soever to the Agency’s construction of the statute, and

ordered EPA to require the states to adopt costly imple-

mentation plan revisions that will substantially compli-

cate the administration of the § 110 federal-state clean

air programs. In the process, the court transformed a

minor statutory provision designed to codify past engi-

neering practice into a comprehensive mandate for “re-

ducing emissions” based upon false air quality predictions.

This case, like other recent decisions of the court below,

exhibits the D.C. Circuit’s view that it is free to decide

whether or not any deference should be given to an agen-

cy’s interpretations of its enabling legislation. As Judge

Mikva asserted in a recent opinion, “the case law...

has not crystalized around a single doctrinal formulation

which captures the extent to which courts should defer to

agency interpretations of law.”** Judge Wright attrib-

%*NRDC v. EPA, No. 81-2001, slip op. at 18 (D.C. Cir. Janu-

ary 17, 1984).

17

utes this perceived lack of clarity to what he terms the

countervailing “gravational pulls of two opposing plati-

tudes,” one counseling deference to reasonable agency in-

terpretations and the other stating that the courts are

the final authorities on matters of statutory construction.”

Where technical terms are involved and the agency is

directed to define them through rulemaking, as is the case

here, decisions of this Court require that the agency’s

interpretations be given “legislative effect.”** If these

interpretations are not given legislative effect, they must

at least be deferred to if they are within the spectrum

of “reasonable” interpretations of the act.** In this case,

rather than giving “legislative effect,” or even “defer-

ence,” to EPA’s reasonable definitions of technical terms

used in § 123 of the Clean Air Act, the D.C. Circuit chose

a third standard of review and appointed itself the “final

authority” on the meaning and application of technical

statutory terms such as “GEP,” “excessive concentra-

tions,” and “nearby terrain obstacles.”

In sum, the D.C. Circuit, a court which is vested with

exclusive or concurrent jurisdiction to review the actions

of virtually every federal agency,* does not view itself as

being bound in any given case to apply the “deference”

standard of review; rather, the choice of “opposing plati-

tudes” is entirely for the court.“

87 Black Citizens for a Fair Media v. FCC, 719 F.2d 407, 428

(D.C. Cir. 1988) (Wright, J., dissenting).

58 Herweg v. Ray, 455 U.S. 265, 274-75 (1982); infra note 48

and accompanying text.

% Train v. NRDC, 421 U.S. 60, 75 (1975); infra note 49 and

accompanying text.

# See, e.g., CAA § 307(b) ; 28 U.S.C. § 2848 (1976) (Hobbs Act) ;

47 U.S.C. § 402(b) (1976) (Federal Communications Commission) ;

26 U.S.C. §9011(a) (1976) (Federal Election Commission).

41 See also Democratic Senatorial Campaign Comm. v. FEC, 660

F.2d 778, 776-77 (D.C. Cir. 1980) (“special deference to an agency’s

18

Certiorari should be granted in this case in order to

avoid substantial and unwarranted changes in the air

quality programs administered by the states under § 110

of the Clean Air Act, and to bring to a halt the un-

certainty created by the D.C. Circuit’s case-by-case ap-

proach to determining the standard it will apply when

reviewing agency interpretations of enabling legislation.

I. THE D.C. CIRCUIT’S REJECTION OF EPA’S RULE-

MAKING IMPLEMENTATION OF “GOOD ENGI-

NEERING PRACTICE” VIOLATES THE DECISION

OF THIS COURT IN HERWEG v. RAY THAT AN

AGENCY’S DEFINITION OF TECHNICAL TERMS

IN ITS ENABLING LEGISLATION MUST BE

GIVEN “LEGISLATIVE EFFECT”

Congress directed EPA in § 123 to “determine under

regulations promulgated by the Administrator” the mean-

ing of “GEP” stack height. CAA § 123(a) (1), (c), App.

110a, 1lla. Unlike other provisions of the Clean Air Act,

Congress made no attempt in § 128 to define key technical

terms such as “excessive concentrations” and “nearby

terrain obstacles.” Compare CAA § 169 (definitions of

terms used in “PSD” provisions). Rather, it simply re-

quired that EPA apply a precautionary standard (i.e.,

“to insure” against unacceptable downwash) when imple

menting the term “GEP.”

Pursuant to this specific delegation of authority to give

content to technical terms in § 123, EPA defined “GEP,”

interpretation of its governing statute is often appropriate...

[this agency interpretation] fails to merit the court’s substantial

deference”), rev'd, 454 U.S. 27, 81-82 (1981) (D.C. Circuit im-

properly addressed “deference” issue); National Wildlife Federa-

tion v. Gorsuch, 698 F.2d 156, 166-70 (D.C. Cir. 1982) (“the stand-

ard for deference to an agency’s interpretation of its governing

statute ‘defies generalized application’). Cf. Public Service Comm’n

v. Mid-Louisiana Gas Co., 108 S.Ct. 3024, 3088 (1988) (White,

Brennan, Marshall, and Blackmun, JJ., dissenting) (dispute as to

deference standard).

19

“excessive concentrations,” and “nearby terrain obstacles”

in a manner that both fulfills the statutory command “to

insure” against the occurrence of unacceptable down-

wash, and reconciles them with longstanding regulatory

and engineering experience. See supra pp. 5-7. To as-

sure that implementation of its definition of GEP would

not produce mindless discrimination against mountainous

or hilly terrain regions of the country, EPA adopted the

“plume impaction” rule. See infra pp. 22-23.

In similar cases in which Congress has made an “ex-

plicit delegation of authority [to an administrative

agency] to give substance to the meaning of” a statutory

term, this Court has applied a standard of review en-

titling the agency’s definition

“to more than mere deference or weight.” [Citations

omitted.] Because Congress has entrusted the pri-

mary responsibility of interpreting a statutory term

to the [agency] rather than to the courts, [t]his defi-

nition is entitled to “legislative effect.” *

Instead of giving EPA’s application of these technical

terms “legislative effect,” the D.C. Circuit, in each in-

stance, rejected EPA’s reasonable interpretation of the

statute and substituted different interpretations based

upon the court’s independent evaluation of congressional

intent. See supra pp. 14-15, infra p. 21. Certiorari is

necessary to clarify for the D.C. Circuit that this Court’s

decision in Herweg v. Ray, 455 U.S. 265 (1982), pro-

vides the appropriate standard of review in this case,

and to correct this intrusion by the court below into

EPA’s delegated powers.

42 See 47 Fed. Reg. at 5865, 5868-69, App. 84a, 99a-100a; GEP

Guidelines at 1-4, 20-23, 47-48, Appendix A.

48 Herweg v. Ray, 455 U.S. 265, 274-75 (1982) (emphasis added).

See also Schweiker v. Gray Panthers, 458 U.S. 34, 48-46 (1981);

Batterton v. Francis, 482 U.S. 416, 424-29 (1977); FEC v. Demo-

cratic Senatorial Campaign Comm., 454 U.S. 27, 87-89 (1981).

20

II. EPA’S INTERPRETATION OF TECHNICAL STATU-

TORY TERMS WAS “SUFFICIENTLY REASON-

ABLE” TO PRECLUDE THE D.C. CIRCUIT FROM

SUBSTITUTING ITS JUDGMENT FOR THAT OF

THE AGENCY

If for any reason this Court determines that the “leg-

islative effect” standard of Herweg v. Ray is not the ap-

plicable standard of review in this case, it is nonetheless

clear that under the decision of this Court in Union Elec-

tric Co. v. EPA, 427 U.S. 246, 256 (1976), the court

below was required to “accord[] great deference to the

Administrator’s construction of the... [Clean Air] Act,”

and that under Train v. NRDC, 421 U.S. 60, 75 (1975),

the court below should have accepted EPA constructions

of the Clean Air Act that were “reasonable.” For the

reasons discussed below, EPA’s rules were based on rea-

sonable constructions of the Act which should have been

given deference by the D.C. Circuit.

Section 123 gives EPA broad latitude to implement

“GEP” rules so long as its rules “insure” that unaccepta-

ble downwash will be avoided. See supra pp. 8-9. The

only other statutory constraint on the Agency’s rulemak-

ing authority to implement GEP is that credit for any

stack height above 2.5 times source height must be estab-

lished through case-by-case adjudication. CAA § 123(c),

App. illa. Thus, the “to insure” language of § 123 con-

templates a conservative rule which errs on the side of

sufficient credit but does not allow automatic credit

greater than 2.5 times source height.

EPA’s final rules were consistent with the commands

of the statute. In promulgating its rules, EPA con-

cluded, based upon statements in the legislative history,

that Congress in § 123 was generally codifying previous

judicial decisions and “affirming the 2% times standard

used by the Administrator.”** Therefore, EPA deter-

“H.R. Rep. No. 95-294 at 98, 91-92, 1977 Legis. Hist. 2560,

2558-59.

21

mined that both “GEP stack height” and “excessive con-

centrations” should be defined in terms of the traditional

2.5 rule, which had been shown through actual practice to

be a conservative measure of the minimum stack height

needed to avoid serious downwash.*

In holding that EPA is precluded frum adopting a

“conservative” GEP formula which provides absolute

protection against unacceptable downwash, App. 28a,

the court below failed to give any effect to the statutory

command that GEP “insure” against unacceptable down-

wash. Instead of looking at the language of the statute,

the court evaluated the acceptability of EPA’s interpre-

tation exclusively in reference to legislative history.

While the court itself described the legislative history as

sending out “sharply conflicting signals” regarding con-

gressional intent, App. 20a-21la, the court rejected EPA’s

construction of the Act on the basis of a single, am-

biguous passage in the Conference Report.“

In requiring EPA to abandon traditional historical

engineering practice and to adopt rules that “err on the

*. GEP Guidelines at 7, Appendix A; see App. 8a-10a. Cf. Corning

Glass Works v. Brennan, 417 U.S. 188, 201 (1974) (“where Congress

has used technical words or terms of art, ‘it [is] proper to explain

them by reference to the art or science to which they [are] appro-

priate’ ad | :

**In analyzing the legislative history, the court conceded that

there was evidence in the legislative history that Congress “probably

intended” to legislate the conservative, preexisting engineering

practice underlying terms such as “GEP” and “excessive concentra-

tions.” App. 8a-9a, 20a. However, the court gave controlling weight

to a single passage in the legislative history which the court charac-

terized as indicating “that the conference committee saw the possi-

bility of a distinction between its definition of the amount of down-

wash to be avoided and what engineers had been doing.” App. 23a

(emphasis added). As a result of this “possibility,” the lower court

concluded that Congress did in fact intend that the broad language

of § 123 would change radically the traditional GEP concept.

22

side of reducing stack height,” *’ the court below com-

pletely ignored the precautionary language of the statute

(“to insure’) and gave no weight whatsoever to EPA’s

reasoned but different view of the legislative history.** As

the decisions of this Court make clear, a reviewing court

is not free to overturn an agency’s interpretation of

technical statutory terms “simply because it may prefer

another interpretation of the statute,” or because “rea-

sonable men could differ as to their construction.” ”

Certiorari is necessary to correct the D.C. Circuit’s con-

fusion as to the appropriate standard of review, which

has led it to rewrite a complex, technical statutory

provision.

Ill. THE D.C. CIRCUIT EXCEEDED ITS AUTHORITY

AS A REVIEWING COURT BY REQUIRING EPA

TO APPLY ITS GEP RULES TO SOURCES IN

RUGGED TERRAIN IN A MANNER NEVER CON-

SIDERED BY CONGRESS

During the rulemaking, EPA interpreted § 123 to al-

low the development of a rule which could be used by

states with hilly or mountainous terrain to determine

GEP emission limitations. This rule makes clear that

such states are not required to revise their § 110 imple

mentation plans based upon GEP modeling results show-

ing “plume impaction” (a phenomenon that can only

occur in rugged terrain areas) when such plume impac-

tion cannot, and does not, occur in reality. Thus, while

Congress in § 123 had called for states to base emission

limitations upon false stack height assumptions, see

supra p. 7, EPA concluded that Congress had not or-

47 App. 28a.

4847 Fed. Reg. at 5865, App. 84a-87a; GEP Guidelines at 1-4.

** INS v. Wang, 450 U.S. 189, 144 (1981). See Beal v. Doe, 432

U.S. 488, 447 (1977); Investment Company Institute v. Camp, 401

U.S. 617, 626-27 (1971).

23

dered the states to apply a second false assumption—

i.e, assuming that stack height is lower than terrain

height when this is not the true relationship. It is the use

of this second false assumption which results in predic-

tions of theoretical “plume impaction.” ”

If this second false assumption were used in atmos-

pheric models developed for sources in rugged terrain,

states would be required to set GEP emission limitations

that would be more stringent by a factor of ten than

the GEP limits imposed upon identical sources in flat

terrain. See supra note 22 and accompanying text; App.

38a-39a. In order to bring GEP emission limits for

rugged terrain sources more into line with those calculated

in flat terrain, EPA developed a rule which, as the lower

court correctly observed, would require sources in moun-

tainous regions to meet GEP emission limitations that

are as restrictive or more restrictive than those cal-

culated in flat terrain." In construing the statute to

eliminate irrational discrimination against rugged ter-

rain areas while at the same time assuring enforcement

of stringent GEP-based emission limits, EPA furthered

the specific objectives of §123 and the general objec-

tives of the Act to protect the “public health and wel-

fare” in a way that also promotes the “productive ca-

pacity” of the nation.

50 See GEP Guidelines at 4; 47 Fed. Reg. at 5866-67, App. 9la-92a.

5! App. 32a n.4. Under the “plume impaction” rule adopted by EPA

to avoid the use of this second false assumption, sources in moun-

tainous terrain would be allowed to assume that terrain height was

equal to GEP stack height. In atmospheric modeling, this terrain

height adjustment would be the only adjustment made for such

sources. Emission limitations would then be calculated using GEP

formula stack height, and these GEP emission limitations would

govern unless the use of actual stack height above GEP height

would result in a more stringent emission limitation due to actual

plume impaction. GEP Guidelines at 4.

52 CAA § 101(b) (1), App. 106a. Requiring states to impose emis-

sion limitations based upon false plume impaction would require

24

In reviewing the “plume impaction” rule, the court

below conceded that Congress, in enacting § 123, did not

“focus on, and resolve” the question of whether GEP

emission limitations should be based upon false plume

impaction. App. 37a. Notwithstanding this congressional

silence and notwithstanding the fact that EPA’s plume

impaction rule would require equal or more stringent

GEP emission limitations for rugged terrain sources, the

court below reversed the rule. The court’s holding is

predicated on the assumption that emissions from sources

in mountainous regions would somehow be dispersed over

a wider territory, and that such “wider dispersion”

would violate congressional intent. App. 29a. These as-

sumptions are wrong.

Since both § 123 and the plume impaction rule affect

only assumed and not actual stack height, the plume im-

paction rule will have no effect whatsoever on the geo-

graphical extent of dispersion from existing stacks in

rugged terrain. See CAA §123(c), App. 1llla. With

respect to new stacks, the plume impaction rule ensures

that stacks in rugged terrain will always be assumed to

disperse pollution less widely than similar stacks in flat

terrain. As to congressional intent, the rule assures

that sources in rugged terrain will meet stringent GEP

sources located in rugged terrain to expend billions of dollars more

on controls than their flat terrain counterparts, even though these

sources emit at much lower levels than sources in flat terrain. Com-

ments of the Utility Air Regulatory Group (June 16, 1981) at 37-

88; Comments of the Southern Company (May 29, 1981) at 1-2.

These large costs would redirect further industrial growth towards

flat terrain areas, where population centers are typically located,

and where sources are able to emit at higher levels and obtain more

dispersion than if they were to locate in rugged terrain. See Com-

ments of the Utility Air Regulatory Group (June 16, 1981) at 46-47;

Comments of Sun Company (Nov. 2, 1981) at 1-2; Comments of

Gulf States Utilities (March 8, 1979) at 1-2.

53 Since emissions at terrain height (the atmospheric modeling

adjustment required by the plume impaction rule) reach the ground

more rapidly than emissions released above terrain (the assump-

25

limi , thus fulfilling the congressional objective that

sources with taller-than-GEP stacks gain no emissions

control advantage due to increased dispersion. See supra

pp. 7-8.

To justify its holding that EPA must apply § 123 in

a way which “discriminates harshly” against states with

mountains and hills, App. 38a, the court once again

resorted to the legislative history of the Act. This time

it focused on congressional testimony relating to the PSD

provisiuns of the Act which the court believed disclosed an

“indifference” by Congress to such discrimination.“ As

the court itself concedes, however, none of this legislative

history supports the conclusion that Congress actually

“focuse[d] on” or “resolve[d]” the question whether the

states must base § 123 emissions limitations on false

predictions of plume impaction. App. 37a.

In view of Congress’ silence, it was incumbent upon

EPA in exercising its § 123 rulemaking authority to re-

solve the regional discrimination problem posed by false

plume impaction predictions in a manner consistent with

the general and specific purposes of the Act. EPA

tion used for flat terrain souces), emissions of sources in rugged

terrain will always be assumed to be dispersed less widely than

comparable emissions from sources in flat terrain. Wher actual

stack height assumptions govern under the plume impaction rule,

the geographical extent of the dispersion will be even less, since

emission limitations will be based upon a concentrated plume inter-

acting with nearby terrain. See GEP Guidelines at 4, 51.

% The court cited legislative history counseling “more careful

siting” of new industrial facilities in rugged terrain as reflecting

this curious congressional bias against hills and mountains. App.

35a-36a, 38a. All of this legislative history, however, is irrelevant to

§ 128 since it concerns the siting of new sources which have flexi-

bility to choose whether or not to locate in rugged terrain. Section

128, by contrast, will immediately affect many existing sources

already located in rugged terrain.

55 See Rose v. Lundy, 455 U.S. 509, 517 (1982) (where it appears

that “Congress never thought of the problem .. . the policies under-

lying the statutory provision [must be analyzed] to determine its

proper scope”) ; Sea-Land Service, Inc. v. Kreps, 566 F.2d 768, 778

(D.C. Cir. 1977) (where there is “no direct statutory mandate, the

26

did this. See supra p. 23. Its decision was reasonable,

particularly in light of the very legislative history re-

lied upon by the court. That legislative history showed

that when regional discrimination was brought to Con-

gress’ attention in the context of problems created by

the PSD provisions of the Act, Congress responded, as

EPA did here, by fashioning a provision ameliorating

the discrimination.”

Certiorari is required in this case to confirm that, in

the face of Congressional silence, EPA had authority to

construe the Clean Air Act in a manner which avoids

absurd and irrational results,°’ while assuring that the

statutory objectives are attained. EPA’s plume impaction

rule was within EPA’s discretion under the statute and

the court below exceeded its authority in rejecting that

rule."*

agency charged with administering the statute muat.. . look to the

purposes underlying the particular provision and the Act in

general’’).

5¢ The court below incorrectly concluded that “[no] relief for

mountainous areas was enacted in response” to the statements it

cites. App. 36a. The PSD provisions, as enacted, include a variance

provision providing for more lenient PSD treatment of sources in

rugged terrain. See CAA § 165(d) (2) (D) (iii)-(iv); 1977 Legis.

Hist. 318, 351, 438, 533.

5? American Tobacco Co. v. Patterson, 456 U.S. 63, 71 (1982).

See also Citizens to Save Spencer County v. EPA, 600 F.2d 844, 891

(D.C. Cir. 1979) (Leventhal, J., concurring): “When an agency

shows good sense, ‘{[c]ourts are loathe to say that good sense is not

good law.’”

58 Even if the D.C. Circuit did not agree with the Agency’s

rationale for the plume impaction rule, it should have simply re-

manded the rule to the Agency for reconsideration rather than re-

versing it based upon the court’s independent factua! assumptions.

See Public Service Comm’n v. Mid-Louisiana Gas Co., 108 S.Ct. 3024,

8088 (1983); South Prairie Construction Co. v. Operating Engi-

neers, 425 U.S. 800, 805-06 (1976) ; FCC v. Pottsville Broadcasting

Co., 8309 U.S. 184, 145 (1940).

27

IV. THE D.C. CIRCUIT’S DECISION WILL SERIOUSLY

RESTRICT ECONOMIC GROWTH IN MANY AREAS

OF THE COUNTRY AND WILL GREATLY COMPLI-

CATE ADMINISTRATION OF THIS NATION’S SYS-

TEM OF AIR QUALITY REGULATION

In this case, the D.C. Circuit has overturned EPA’s

implementation of § 123 in favor of a different approach

advocated by environmental groups. The court’s decision

rejects the ground rules which, since 1978, have guided

the states in developing emission limitations under § 110

of the Act.

The new ground rules called for by the D.C. Circuit

will require all fifty states to adopt comprehensive revi-

sions to their state implementation plans. Emissions re-

ductions brought about by these revisions will not be

based upon real threats to the public health and welfare,

but rather upon theoretical local violations of ambient

requirements that are predicted to occur when false stack

height assumptions are used.

Under the required state implementation plan revi-

sions, existing industrial facilities face the prospect of

billions of dollars in additional costs. See supra pp. 10-

11, 23 n.52. As to new source construction, the decision

could require the states to develop costly emission offset

programs designed to avoid theoretical, not actual, viola-

tions of ambient standards.” If offsets could not be ob-

tained, no growth could take place.

°° Under CAA §§ 110 and 168, industrial growth can take place

only if it is demonstrated that no violations of ambient standards

and PSD increments will occur. Under the ambient standard defini-

tion of “excessive concentrations” suggested by the D.C. Circuit,

see App. 19a-20a, 24a, 27a, a source’s stack height credit would be

set to predict ambient concentretions just below the ambient stand-

ards. This definition of “excessive concentrations” would thus re-

quire emissions offsets before any further construction could take

place, in order to avoid theoretically predicting violations of ambient

standards or PSD increments.

28

Regarding the administration of § 110 by the states,

the court’s decision will further complicate already overly

complex state regulatory programs. By expanding the

use of false stack height assumptions, the states would

be forced to refocus their air pollution control on non-

existent pollution concentrations predicted using mathe-

matical models. Whenever mathematical models are

changed, new emission limitations would have to be es-

tablished.” Real air quality—i.e., the air that people

actually breathe—would cease to govern, or even affect,

the stringency of emission limitations and would be

largely irrelevant to administration of the Act.”

In sum, the D.C. Circuit in this case mandates EPA

regulatory changes that would transform the § 110 regu-

latory program from one that is largely directed at ac-

tual pollution concentrations to one directed at abating

wholly theoretical violations of public health and welfare

standards. The D.C. Circuit has thus set in motion a

* Since § 128 focuses on theoretical rather than actual ambient

concentrations, it can be implemented only through mathematical

dispersion models. Under § 320(a) of the Act, EPA is required to

conduct a proceeding at least every three years to revise air quality

models in light of the most recent scientific information. Every time

these models are revised they will predict different ambient concen-

trations. As a result, by making false stack height assumptions the

centerpiece of clean air regulation, the D.C. Circuit will require the

states to engage in a never-ending process of implementation plan

revisions.

*: The New York Department of Environmental Conservation

recently requested EPA to seek further review of the “excessive

concentrations” portion of the D.C. Circuit’s decision since it will

open a “Pandora’s box” of false regulatory assumptions, imposing

requirements which “most states do not have the expertise or the

resources to apply.” Letter from New York Department of Environ-

mental] Conservation to EPA at 2 (December 27, 1988). The cur-

rent rulemaking record shows that states would have had difficulty

coping with the reviews required under the 1979 proposal. See, ¢.g.,

46 Fed. Reg. 49821 (1981); Comments of New York Dep't of En-

vironmental Conservation (March 6, 1979) at 2; Comments of

Texas Air Control Board (March 18, 1979) at 2-3.

29

process that will lead EPA to require the states to im-

pose many emission limitations that are more stringent

than necessary to attain ambient standards, a result re-

jected in Train v. NRDC, 421 U.S. 60 (1975). Equally

important, the court below has required enormously

costly compliance measures even though the public health

is not in fact threatened, a result which, if allowed to

stand, should lead this Court to reconsider its decision in

Union Electric, 427 U.S. 246, 258-59 (1976). Certiorari

is necessary in this case to review this D.C. Circuit deci-

sion which threatens to restructure in a fundamental

way this nation’s system of air quality regulation.

CONCLUSION

For the reasons stated, this petition for certiorari

should be granted.

Respectfully submitted,

HENRY V. NICKEL

(Counsel of Record)

F. WILLIAM BROWNELL

MICHELE POLLAK

HUNTON & WILLIAMS

P.O. Box 19280

2000 Pennsylvania Ave., N.W.

Washington, D.C. 20086

(202/955-1500)

Counsel for Petitioners

Alabama Power Co., et al.

February 28, 1984

SUPPLEMENTAL

APPENDIX

A-1

PARENT COMPANIES, SUBSIDIARIES AND

AFFILIATES OF INDIVIDUAL ELECTRIC UTILITIES

Alabama Power Company

(subsidiary of The Southern Company)

subsidiary :

Alabama Property Company

affiliate :

Southern Electric Generating Company

Appalachian Power Company

(subsidiary of American Electric Power Company,

Inc. )

subsidiaries :

Central Appalachian Coal Company

Central Coal Company

Central Operating Company

Kanawha Valley Power Company

Southern Appalachian Coal Company

West Virginia Power Company

Cedar Coal Company

Baltimore Gas and Electric Company

subsidiaries :

Resource and Property Management, Inc.

Safe Harbor Water Power Corp.

Boston Edison Company

Carolina Power & Light Company

subsidiaries :

Capitan Corporation

Leslie Coal Mining Company

McInnes Coal Mining Company

Carolina Power & Light Finance N.V.

affiliate :

Carolinas-Virginia Nuclear Power Associates,

Inc.

A-2

Central and South West Corporation

subsidiaries :

Central Power and Light Company

Public Service Company of Oklahoma

subsidiary :

Ash Creek Mining Co.

Transok Pipe Line Co.

Southwestern Electric Power Company

subsidiary :

Southwest Arkansas Utilities Corp.

affiliate :

Arklahoma Corp.

West Texas Utilities Company

Central and South West Services, Inc.

Central and South West Fuels, Inc.

CSW Financial Inc.

Central Hudson Gas and Electric Corporation

subsidiaries :

Phoenix Development Company, Inc.

Greene Point Development Corporation

Central Hudson Enterprises Corp.

CH Resources, Inc.

Central Illinois Light Company

subsidiaries :

CILCO Exploration and Dev. Co.

CILCO Energy Corporation

Central Illinois Public Service Co.

subsidiary :

Electric Energy, Inc.

A-3

The Cincinnati Gas and Electric Company

subsidiaries :

Union Light, Heat and Power Co.

West Harrison Gas & Electric Co.

Miami Power Corp.

Lawrenceburg Gas Co.

Lawrenceburg Gas Transmission Corp.

Tri-State Improvement Co.

YGK Ine.

The Cleveland Electric Illuminating Co.

subsidiaries :

The Ceico Co.

CCO Co.

Columbus and Southern Ohio Electric Company

(subsidiary of American Electric Power Company,

Inc. )

subsidiaries :

Colomet, Inc.

Simco, Inc.

Commonwealth Edison Company

subsidiaries :

Commonwealth Edison Co. of Indiana, Inc.

Chicago & Illinois Midland Railway Co.

Cotter Corp.

Commonwealth Research Corp.

Edison Development Canada Inc.

Edison Development Co.

Concomber, Ltd.

Consolidated Edison Company of New York, Inc.

Consumers Power Company

subsidiaries :

Michigan Gas Storage Company

Northern Michigan Exploration Company

A-4

Michigan Utility Collection Service Co., Inc.

Plateau Resources Limited

Utility Systems, Inc.

Consumers Power Finance N.V.

The Dayton Power and Light Company

subsidiaries :

DP&L Community Urban Redevelopment Corp.

Miami Valley Development Company

ZMS Ine.

Delmarva Power & Light Company

subsidiaries :

Delmarva Energy Co.

Delmarva Industries, Inc.

The Detroit Edison Company

subsidiaries :

Edison Illuminating Company

Midwest Energy Resources Company

St. Clair Energy Corp.

Washtenaw Energy Corp.

Utility Technical Services, Inc.

Duke Power Company

subsidiaries :

Mill-Power Supply Co.

Crescent Land & Timber Corp.

subsidiaries :

Millwood Co.

Wateree Power Co.

Eastover Land Co.

Eastover Mining Co.

Western Fuel, Inc.

Wateree Power Co.

Catawba Manufacturing and Electric Power Co.

A-5

Western Carolina Power Co.

Caldwell Power Co.

Southern Power Co.

Greenville Gas and Electric Light and Power

Co.

Duke Power Overseas Finance N.V.

Florida Power Corporation

(subsidiary of Florida Progress Corporation)

Florida Power & Light Company

subsidiaries:

Fuel Supply Service, Inc.

Land Resources Investment Company

W. Flagler Investment Corp.

Georgia Power Company

(subsidiary of The Southern Company)

subsidiary :

Piedmont Forrest Co.

affiliate :

Southern Electric Generating Company

Gulf Power Company

(subsidiary of The Southern Company)

Gulf States Utilities Company

subsidiary :

Varibus Corporation

Houston Lighting & Power Company

(controlled by Houston Industries, Inc.)

Illinois Power Company

subsidiaries :

IP Ine.

IPF Co. N.V.

Illinois Power Fuel Company

“*!

.

A-6

affiliate :

Electric Energy, Inc.

Indiana & Michigan Electric Company

(subsidiary of American Electric Power Company,

Inc. )

subsidiaries :

Price River Coal Company

Blackhawk Coal Company

Indianapolis Power & Light Company

Iowa-Illinois Gas and Electric Company

subsidiary :

Iowa-Illinois Energy Co.

Iowa Public Service Company

subsidiaries :

Cimmred, Inc.

Energy Development Company

Energy Reserves, Inc.

Centennial Coal, Inc.

Midwest Energy Co.

Midwest Energy Services Co.

Kansas City Power and Light Company

Kentucky Power Company

(subsidiary of American Electric Power Company,

Inc.)

Kentucky Utilities Company

subsidiary :

Old Dominion Power Company

Long Island Lighting Company

subsidiary :

LILCO Energy Systems, Inc.

A-7

Madison Gas and Electric Company

subsidiaries :

MG&E NUCLEAR FUEL INC.

MAGAEL INC.

MAGAEL Material Resources, Inc.

Arkansas Power & Light Company

(subsidiary of Middle South Utilities, Inc.)

subsidiary :

Associated Natural Gas Co.

affiliates:

System Fuels, Inc.

The Arklahoma Corp.

Louisiana Power & Light Company

(subsidiary of Middle South Utilities, Inc.)

Mississippi Power & Light Company

‘subsidiary of Middle South Utilities, Inc.)

subsidiaries :

The Light, Heat & Water Company of Jackson*

Jackson Gas Light Company*

Jackson Light & Traction Company*

affiliate:

Systems Fuels, Inc.

New Orleans Public Service, Inc.

(subsidiary of Middle South Utilities, Inc.)

subsidiary :

Systems Fuels, Inc.

Mississippi Power Company

(subsidiary of The Southern Company)

* Inactive

A-8

Monongahela Power Company

(subsidiary of Allegheny Power System, Inc.)

subsidiaries :

Allegheny Generating Co.

Allegheny Pittsburgh Coal Company*

New England Power Company

(subsidiary of New England Electric System)

New York State Electric & Gas Corporation

Northeast Utilities

subsidiaries :

Connecticut Light and Power Company

subsidiaries :

Shelton Canal Co.

Research Park, Inc.

Connecticut Gas Co.

Electric Power, Inc.*

Connecticut Transmission Corp.*

City & Suburban Electric Gas Co.

The Nutmeg Power Company

The Mohawk Gas Co.*

The Connecticut Steam Co.*

Northeast Nuclear Energy Company

Quinnehtuk Company

Rocky River Realty Company

Western Massachusetts Electric Co.

Northeast Utilities Service Co.

Northern Indiana Public Service Company

subsidiaries :

Shore Line Shops, Incorporated

NIPSCO Exploration Co.

NIPSCO Fuel Co., Inc.

Northern Indiana Public Service Finance N.V. |

* Inactive

Ohio Edison Company

subsidiaries :

Pennsylvania Power Company

Ohio Edison Finance N.A.

Ohio Power Company

(subsidiary of American Electric Power Company,

Inc. )

subsidiaries :

Central Coal Company

Central Ohio Coal Company

Central Operating Company

Southern Ohio Coal Company

Windsor Power House Coal Company

Beech Bottom Power Co., Inc.

Cardinal Operating Co.

Ohio Valley Electric Corporation

subsidiary :

Indiana-Kentucky Electric Corp.

Oklahoma Gas and Electric Company

subsidiary :

Arklahoma Corporation

Pennsylvania Power and Light Co.

subsidiaries :

Pennsylvania Mines Corp.

subsidiaries :

Tunnelton Mining Co.

Greene Manor Coal Co.

Rushton Mining Co.

Greene Hill Coal Co.

Service Development Company

Safe Harbor Water Power Corp.

Realty Company of Pennsylvania

A-10

subsidiaries :

BDW Corp.

LCA Leasing Corp.

Lady Jane Colleries, Inc.

Interstate Energy Co.

The Arcadia Company, Inc.

The Potomac Edison Company

(subsidiary of Allegheny Power System, Inc.)

subsidiaries :

Allegheny Generating Company

Allegheny Pittsburgh Coal Company *

Potomac Electric Power Company

Subsidiary :

Potomac Electric Finance N.V.

Public Service Company of Indiana, Inc.

Public Service Electric and Gas Company

subsidiaries :

Energy Development Corp.

subsidiary :

Gasdel Pipeline System, Inc.

PSE&G Research Corp.

Energy Terminal Services Corp.

Energy Pipeline Corp.

PSE&G Overseas Finance N.V.

Rochester Gas & Electric Corporation

Salt River Project

Southern California Edison Company

subsidiarizs :

Associated Southern Investment Co. (ASIC)

Electric Systems Company

* Inactive

A-11

Energy Services Inc.

Calabasas Park Company (CPC)

Calabasas Communications Company

Southern Surplus Realty Company

Mono Power Company

Bear Creek Uranium Company

Mono Green Mountain Company

Southern California Edison Finance Co. N.V.

Palo Verde Uranium Venture

Tampa Electric Company

(controlled by TECO Energy, Inc.)

Texas Utilities Generating Company

(subsidiary of Texas Utilities Company)

Toledo Edison Company

Tucson Electric Power Company

subsidiary :

Alamito Coal Co.

Escavada Leasing Co.

Valencia Energy Co.

Union Electric Company

subsidiaries :

Union Colliery Company

Missouri Power & Light Company

Missouri Edison Company

Missouri Utilities Company

affiliate :

Electric Energy, Inc.

Virginia Electric and Power Company

(controlled by Dominion Resources, Inc.)

subsidiaries :

Laurel Run Mining Company

Virginia Nuclear, Inc.

A-12

West Penn Power Company

(subsidiary of Allegheny Power System, Inc.)

subsidiaries :

Allegheny Generating Company

Allegheny Pittsburgh Coal Company*

Beech Bottom Power Company, Inc.

West Virginia Power & Transmission Co.

subsidiary :

West Penn West Virginia Water

Power Company

Wisconsin Electric Power Company

subsidiaries :

Wisconsin Natural Gas Company

Badger Service Company

Wisconsin Power and Light Company

subsidiaries :

South Beloit Water, Gas and Electric Co.

Wisconsin Power and Light Nuclear Fuel, Inc.

NUFUS Resources, Inc.

Windworks, Inc.

affiliate:

Wisconsin River Power Company

Wisconsin Public Service Corporation

affiliates :

Wisconsin River Power Company

Wisconsin Valley Improvement Company

Delores Bench General Partner, Inc.

* Inactive