Opposition — Alabama Power Co. v. Sierra Club

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Office - Supreme Court, U

FILED

MAR

No. 83-1429 19 104

tile STEW AS,

CLERK

IN THE —

Supreme Court of the Anited States

OCTOBER TERM, 1983

ALABAMA Power Co., ef al.,

Petitioners,

SIERRA CLUB, et al.,

Respondents.

RESPONSE OF KENNECOTT IN SUPPORT OF

PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

ALFRED V. J. PRATHER

(Counsel of Record)

Kurt E. BLASE

Prather Seeger Doolittle & Farrner

1101 Sixteenth Street, N.W.

Washington, D.C. 20036

(202) 296-0500

Counsel for Respondent

March 19, 1984 Kennecott

PP AS 0

PRESS OF BYRON 8S. ADAMS PRINTING, INC., WASHINGTON, D.C. (202) 347-8203

TABLE OF AUTHORITIES

CASES: Page

Bunker Hill Co. v. EPA, 572 F.2d 1286 (9th Cir. 1977) 2

ennees Copper Corp. v. Costle, 572 F.2d 1349 (9th Cir.

Kennecott C Corp. v. Train, 526 F.2d 1149 (9th Cir.

1975), cert. denied, 425 U.S. 395 (1976) ..........

Kennecott Corp. v. EPA, 684 F.2d 1007 (D.C. Cir. 1982) 2

Sierra Club v. EPA, 719 F.2d 436 (D.C. Cir. 1983)... 4

STATUTES:

The wen Air Act, 42 U.S.C. § 7401, et seg. (Supp. V

ee SS EE ns co vosncchecectebeqecesed 2,3

88 ys Sea 2

I ars on cian us gu 06 ka'seWdeess wee 5

REGULATIONS:

Nevada Administrative Code § 445.7657 ............. 3

Utah Air Conservation Regulations § 4.3.2 .......... 3

FEDERAL REGISTER:

38 Fed. Reg. 25698, 25700 (1973) ............cceeeee 2

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Oe EID gp casa tn ccccagwdavevessiachs 2

By BOs Bi DUD obese ci cvccsccvccascsccees 3

48 Fed. Reg. 1717, 1719 (1983) .......... cc eeeeeeees 3, 4

49 Fed. Reg. 6460-61 (1984) ........... cc cece eee eee 3

LEGISLATIVE MATERIALS:

H.R. Rep. No. 95-294, 95th Cong., Ist Sess. 61-63(1977) 3

S. Rep. No. 97-666, 97th Cong., 2d Sess. 19-21 (1982) . 3

ie st

IN THE

Supreme Court of the Gnited States

OCTOBER TERM, 1983

No. 83-1429

ALABAMA PowWER Co., et al.,

Petitioners,

Vv.

SIERRA CLUB, et al.,

Respondents.

RESPONSE OF KENNECOTT IN SUPPORT OF

PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Kennecott' operates copper smelters in four western

states—Arizona, Nevada, New Mexico and Utah. The regula-

tions at issue in this case, which were invalidated by the court

below, directly affect three of Kennecott’s four smelters. For

this reason, Kennecott intervened in the proceeding below,

and files this Response pursuant to Supreme Court Rule 19.6.

Kennecott supports the Petition for a Writ of Certiorari filed

by Alabama Power Co. and other electric utilities, and joins in

' Kennecott, formerly Kennecott Minerals Co., is an operating company of

the arguments presented therein. In particular, Kennecott

agrees that in rejecting certain of the stack height regulations,

the court below impermissibly substituted its judgment for

that of the Environmental Protection Agency (EPA). For Ken-

necott and other smelter companies, the result may be destruc-

tion of a compliance strategy that has been over a decade in the

making at a cost of over a billion dollars.

The unique economic and technological problems facing the

smelting industry in its quest for control of sulfur dioxide (SO,)

emissions under the Clean Air Act are well known, having

been the subject of numerous cases in the courts of appeal and

special statutory relief.* Prior to 1977, EPA encouraged smel-

ters to use tall stacks, in conjunction with supplementary

control systems (SCS), where other feasible control measures

could not produce compliance with SO, emission require-

ments.’ In 1977, Congress enacted Section 119 of the Act (42

U.S.C. § 7419), which extends this policy through 1987 for

smelters meeting an economic eligibility test.‘ Beginning in

1988, all smelters must meet SO, emission limitations set ac-

cording to Section 123 (42 U.S.C. § 7423), which forbids credit

for SCS and stacks exceeding heights required by “good engi-

neering practice” (GEP).

The copper smelting industry is now well on its way toward

meeting this goal. Since 1970, the industry has reduced SO,

emissions by 57 percent and by 1988 these emissions will be

* See 42 U.S.C. § 7419 (Supp. V 1981) (permitting issuance of nonferrous

smelter orders containing extended compliance schedules); see, ¢.¢., Kenne-

cott Copper Corp. v. Costle, 572 F.2d 1349 (9th Cir. 1978) (Kennecott II);

Bunker Hill Co. v. EPA, 572 F.2d 1286 (9th Cir. 1977); Kennecott Copper

rg v. Train, 526 F.2d 1149 (9th Cir. 1976) (Kennecott I), cert. denied, 425

S. 396 (1976).

* See 41 Fed. Reg. 7452 (July 18, 1976) (1976 stack height policy); 38 Fed.

Reg. 25698, 25700 (Sept. 14, 1973) (1973 stack height policy); see also 40 Fed.

Reg. 49864 (Oct. 22, 1975) (applying policy to Arizona smelters); 40 Fed.

Reg. 19212 (May 2, 1975) (Kennecott New Mexico smelter); 40 Fed. Reg.

5511 (Feb. 6, 1975) (Kennecott Nevada smelter).

* See Kennecott Corp. v. EPA, 684 F.2d 1007 (D.C. Cir. 1982).

reduced still further, a record unmatched by any other major

source of SO,. This reduction has been achieved at a cost of over

$1.5 billion, which represents devotion of a larger percentage

of available capital to clean air expenditures than that devoted

by any other major industry. All four Kennecott smelters now

meet ambient standards for SO,, and Kennecott’s ex-

penditures to reach this goal total approximately $750 million

in 1982 dollars. As Congress recognized in enacting Section

119, these expenditures have been made during a time of

severe economic distress in the copper industry.’

In conjunction with these industry efforts, smelter states

have spent over a decade developing acceptable smelter SO,

emission limitations. These efforts have recently culminated in

adoption by several states of emission limits based on the new

“multi-point rollback” (MPR) method, an advanced modeling

technique which has finally put an end to the search for feasible

and effective smelter SO, emission limits. EPA has already

approved smelter MPR regulations adopted by Arizona and

New Mexico, and similar regulations adopted by Nevada and

Utah are currently pending EPA approval.’ Upon EPA ap-

proval of the MPR regulation for Kennecott’s Utah smelter,

Kennecott has announced tentative plans to modernize related

mining and processing facilities at a cost of over one billion

dollars, which will produce still further environmental and

operational benefits.’

The decision below jeopardizes this entire compliance strat-

egy. The MPR regulations for Kennecott’s Arizona, Nevada

and Utah smelters depend on GEP demonstrations for tall

5 See H.R. Rep. No. 95-294, 95th Cong., Ist Sess. 61-63 (1977); see also S.

Rep. No. 97-666, 97th Cong., 2d Sess. 19-21 (1982) (economic concerns

remain in 1982).

* See 48 Fed. Reg. 1717 (Jan. 14, 1983) (Arizona approval); 47 Fed. Reg.

19832 (May 5, 1982) (New Mexico approval); Nevada Administrative Code

§ 445.7657; Utah Air Conservation Regulations § 4.3.2.

‘EPA has recognized that Kennecott’s Utah modernization plan would

greatly reduce particulate emissions. See 49 Fed. Reg. 6460-61 (Feb. 21,

1984) (discussing Kennecott comments on applicable new source perform-

ance standards).

‘

>}, *'

stacks originally built in compliance with EPA's smelter policy

and necessary to mitigate the effects of nearby mountain

ranges.’ The court’s rejection of EPA’s “plume impaction”

provision, and its restrictive definition of “nearby” as applied

to GEP demonstrations involving terrain obstacles, may ren-

der the MPR demonstrations invalid. This would waste over a

decade in compliance efforts, would add untold millions to

smelter compliance costs and would indefinitely prolong the

current closure of Kennecott’s Arizona and Nevada smelters.

The Utah modernization project could be abandoned or in-

definitely postponed and the smelter could be shut down, re-

sulting in additional shrinkage of a vital domestic industry

already operating well below its former production capacity.’

Such drastic consequences are in no way required by the

Clean Air Act. In remanding EPA’s regulation governing GEP

demonstrations based on “nearby” terrain obstacles, the court

below admitted that the regulation was rational and supported

by the legislative history. Sierra Club v. EPA, 719 F.2d 436,

444-45 (D.C. Cir. 1983). Nevertheless, the court rejected the

regulation based on speculation as to what Congress “may

have” intended, admitting that “an element of arbitrariness”

would result. 719 F.2d at 445. The court also relied on an

alleged congressional intent to discourage utilities from locat-

ing in mountainous terrain (id.), a consideration obviously

inapplicable to smelters which were located in the mountains

early in this century to be near related mining and crushing

facilities. This rationale also was used to invalidate EPA's

plume impaction provision, though the court recognized that

this would result in harsh discrimination against sources lo-

cated in mountainous terrain. 719 F.2d at 453-55.

* The Arizona regulation is based on GEP credit for the stack of a neighbor-

ing smelter with which Kennecott shares en airshed. See 48 Fed. Reg. 1719

(Jan. 14, 1983) (GEP demonstration for ASARCO smelter stack).

* The decision below already has delayed the Utah modernization

by delaying EPA approval of the Utah MPR regulation, without which the

project cannot proceed.

In short, the D.C. Circuit rejected EPA's interpretation of

an ambiguous and highly technical statute that reached

admittedly reasonable results, and substituted its own in-

terpretation which produces results admittedly arbitrary and

discriminatory. The consequences will likely include destruc-

tion of a smelter SO, compliance strategy that has been over a

decade in development. Despite Kennecott’s participation as

an intervenor, the impact of the court’s decision on the copper

smelting industry is not even mentioned in the opinion below.

And the court remains free to apply its convoluted canon of

statutory construction to all Clean Air Act regulations of na-

tional importance, because the Act requires review of such

regulations in the D.C. Circuit (see 42 U.S.C. § 7607(b)). For

these reasons, as well as those advanced in the utilities’ Peti-

tion, Kennecott urges this Court to grant certiorari and re-

verse the decision of the court of appeals.

Respectfully submitted,