Amicus Curiae Brief — Environmental Defense v. Duke Energy Corporation

5

calculation called for by the verb ‘emit’ [to] lose all signifi-

cance”).

The Fourth Circuit’s “modification” test would ignore

that clear intent by focusing on whether a change in-

creases a source’s maximum “hourly emissions rate” —

which is a measure of whether a change would increase a

source’s emissions capacity, not of whether the change

would cause actual emissions to increase. Specifically, the

Fourth Circuit’s maximum hourly test unlawfully ignores

large actual emission increases from increased hours of

operation made possible by a plant renovation. Indeed,

increased hours of operation could cause a source’s overall

emissions to increase dramatically without increasing its

hourly emissions rate. Congress expressly sought to avoid

such an outcome by framing the CAA in terms of

“amount(s] . . . emitted,” 42 U.S.C. § 7411(a).

A straightforward analysis of the CAA’s language

demonstrates the difference between regulating amounts

of emissions and regulating emissions rates. As defined by

the Merriam-Webster’s Collegiate Dictionary, “amount” is

the “total number or quantity,” and “emit” is “to throw or

give off or out.” Merriam-Webster’s Collegiate Dictionary

39, 378 (10th ed. 1998). A program that regulates station-

ary sources by their hourly emissions rates alone would

fail to regulate changes that cause a stationary source to

“give off” increased quantities of pollutants. In sharp

contrast, a program that regulates statutory sources by

amounts of emissions, as does the actual annual emissions

increase test in EPA’s 1980 PSD regulations, would evalu-

ate the actual quantity of pollutants given off by the

stationary sources. Cf. Alabama Power, 636 F.2d at 353.

6

Unlike the Fourth Circuit’s hourly emission rate test,

the annual emissions increase test required under EPA’s

PSD regulations gives force to Congress’s intent to regu-

late those changes that cause actual emission increases.”

Accordingly, the Fourth Circuit’s refusal to apply the

regulatory annual emissions test — and its insistence that

EPA must instead utilize a capacity-based hourly emis-

sions rate test — should be rejected by the Court.

B. The Structure of the PSD Compliance Re-

quirements Further Demonstrates Con-

gress’s Intent to Regulate Actual Emissions

Increases.

Moreover, for the sake of the purpose of the PSD New

Source Review (NSR),‘ Section 111(a)(4) must be held to

require compliance for those changes to a stationary

source that increase actual emissions. Under Section

165(a) of the Act, Congress set forth specific compliance

procedures for “major emitting facilitlies] constructed in

any area to which this part applies....” 42 U.S.C.

§ 7475(a). Section 165 requires that a facility seeking to

undergo construction must obtain from EPA a permit

“setting forth emissions limitations for such facility which

* See 45 Fed. Reg. 52,675, 52,701 (seeking “as close a correspon-

dence as possible” between the regulatory coverage of new and modified

sources and their actual impacts on air quality and available PSD

increment).

* The PSD program, along with the Nonattainment New Source

Review (NNSR) program, collectively make up a broader program

referred to as the New Source Review (NSR). While the NNSR program

pertains to regions that fail to satisfy their National Ambient Air

Quality Standards (NAAQS), 42 U.S.C. §§ 7505-7515, the PSD program

pertains primarily to regions where the air quality levels satisfy the

NAAQS.

conform to the requirements of this part.” Jd. § 7475(a)(1).

In turn, Section 169(2)(C) of the PSD provisions states

that the “term ‘construction’ when used in connection with

any source or facility, includes the modification (as defined

in Section 111l(a)) of any source or facility.” 42 U.S.C.

§ 7479(2\(C) (emphasis added). Section 165 also requires

the owner or operator of such a facility to demonstrate

that emissions from construction or operation of

such facility will not cause, or contribute to, air

pollution excess of any (A) maximum allowable

increase or maximum allowable concentration for

any pollutant in any area to which this part ap-

plies more than one time per year, (B) national

ambient air quality standard in any air quality

control region, or (C) any other applicable emis-

sion standard or standard of performance under

this chapter;

Id. § 7475(a)(3).

Again, a plain language analysis demonstrates that

Congress intended to allow the PSD program to regulate

the actual emitted amount of air pollution resulting from a

construction, rather than limit regulation to the hourly

emissions rate desired by the industry respondents. As

defined by the Merriam-Webster’s Collegiate Dictionary,

“emissions” is the “act of” “throwling] or giv[ing] off or

out.” Merriam-Webster’s Collegiate Dictionary 378 (10th

ed. 1998). “Cause,” in turn, is defined as “to serve as a

cause or occasion of,” id. at 182, and “contribute” is defined

as “to give or supply in common with others,” id. at 252.

Accordingly, a program that regulates statutory sources

based on emissions caused by facility construction, as do

EPA’s 1980 PSD regulations, must be able to evaluate

whether the proposed modification would give off or

8

supply excess actual pollutants in violation of 42 U.S.C.

§ 7503(a)(3).

In contrast, a program that is limited to regulating

stationary source modifications solely by their hourly

emissions rates, without also allowing regulation of actual

emissions, would fail to control modifications from giving

off increased quantities of pollutants. The PSD provisions

account for emissions rates, but not without regard to

other factors. For example, a proposed modification could

operate for an increased number of hours each day in a

manner that it could not absent the construction, thereby

increasing its overall emissions under this regime without

increasing its emissions rate. But Section 165 expressly

seeks to avoid such loopholes by addressing “emissions”

that would “cause, or contribute to,” excess air pollution in

violation of the PSD provisions, 42 U.S.C. § 7503(a)(3).

Any attempt to restrict the PSD program from regulating

actual increased quantities of pollutants should be rejected

as contrary to the language of the CAA.

C. The Overall Structure of the Statute Also

Emphasizes the Critical Role Of Actual

Emissions in the New Source Review Proc-

ess.

The emphasis that the statutory language places on

actual emissions, as opposed to a source’s emissions

capacity (i.e., its maximum hourly emissions rate), is

crucial to the larger context and purpose of the CAA’s New

Source Review (NSR) provisions, of which the PSD re-

quirements are one part. Congress intended these NSR

provisions to guard against increases that threaten to

worsen ambient air quality. Indeed, Section 165 must be

read in the context of other statutory provisions and the

9

purpose of the NSR program. See Raygor v. Regents of the

Univ. of Minn., 534 U.S. 533, 545-46 (2002) (“[I]t is a

fundamental canon of statutory construction that the

words of a statute must be read in their context and with a

view to their place in the overall statutory scheme” (cita-

tion and internal quotations omitted); see also Gen

Dynamics Land Sys. v. Cline, 540 U.S. 581, 596 (2004)

(applying “the cardinal rule that statutory language must

be read in context since a phrase gathers meaning from

the words around it”) (internal quotations, brackets, and

citation omitted); Koons Buick Pontiac GMC v. Nigh, 543

U.S. 50, 60 (2004) (stating that statutes are to be read in a

“holistic” manner); Chao v. Mallard Bay Drilling, 534 U.S.

235, 245 n.9 (2002) (holding an interpretation that would

leave “large gaps in the regulation of occupational health

and safety” would be “plainly inconsistent with the pur-

pose of the [Occupational Safety and Health] Act”).

In addition to the plain language of CAA § 111(a)(4),

as well as CAA § 165, numerous other statutory provisions

demonstrate Congress’s intent that the PSD program

regulate any physical change that causes a facility to

increase its actual emissions air pollution, regardless of

whether the change also increases the facility's hourly

emissions rates. See 42 U.S.C. §§ 7479(1), 7475(b),

751. ..c)(6). These provisions all address changes in terms

of either actual amounts per year or total emissions,

rather than the hourly emission rates measured by the

Fourth Circuit’s required test. For example, the CAA

requires NSR under its PSD provisions prior to construc-

tion of any new source that emits, or has the potential to

emit, more than the “tons per year” threshold applicable to

that source category. See 42 U.S.C. § 7479(1). Specifically,

the statute establishes a 100 ton per year threshold for

10

certain specified sources (including “fossil-fuel fired steam

electric plants of more than two hundred and fifty million

British thermal units per hour heat input”), and a 250 ton

per year threshold for all other sources. Jd. In contrast, the

respondents’ hourly rates would authorize sources to

proceed without review even when making changes that

cause annual emission increases many times the amount

that would have triggered NSR if the source were being

built from scratch. Such an absurd result plainly contra-

venes Congress’s intent.

Likewise, the statute exempts certain modifications

from NSR’s required air quality analysis under limited

circumstances that include where a source limits its post-

modification burden on air quality to “less than fifty tons

per year” (emphasis added), 42 U.S.C. § 7475(b). Again,

this statutory approach plainly demonstrates that Con-

gress did not intend for EPA to utilize hourly emissions

rates as a trigger for PSD.

The 1990 CAA amendments further emphasize Con-

gress’s long-standing understanding of NSR applicability

as turning on whether a change will increase a source’s

actual annual emissions. For example, Section 182(c)(6),

added to the Act in 1990, specifies a special de minimis

rule for sources that emit volatile organic compounds, and

couched that rule in terms of tons per year increases.

Specifically, this new statutory provision states:

The new source review provisions under this part

shall ensure that increased emissions of volatile

organic compounds resulting from any physical

change in, or change in the method of operation

of, a stationary source located in the [serious

nonattainment] area shall not be considered de

11

minimis for purposes of determining the applica-

bility of the permit requirements established by

this chapter unless the increase in net emissions

of such air pollutant from such source does not

exceed 25 tons when aggregated with all other

net increases in emissions from the source over

any period of 5 consecutive calendar years which

includes the calendar year in which such in-

crease occurred.

42 U.S.C. § 751la(c)(6). Immediately following that provi-

sion, another provision creates a “special rule for modifica-

tions of sources emitting less than 100 tons,” which applies

whenever such a source makes a change “except for a de

minimis increase” as established in Section 182(c)(6). See

42 U.S.C. § 751la(c)4)(C\(7). Thus, the applicability of

this provision depends on whether a change would lead to

more than a de minimis increase, which Section 182(c)(6)

defines in terms of the annual tonnage increase resulting

from a planned change. See 42 U.S.C. § 7511la(c)(4)(C)(6).

The same is true for Section 182(c)(8), which establishes a

“special rule for modifications of sources emitting 100 tons

or more.” See 42 U.S.C. § 751la(c)(4)(C\(8). These provi-

sions are part of the statutory context and thus are rele-

vant to interpretation of congressional intent, and confirm

that the CAA focuses the NSR on annual actual emissions,

not a source’s hourly emissions rate.

II. The Purpose of the PSD Amendments Would Be

Frustrated If the Act Is Interpreted to Limit

PSD Review to Those Changes that Increase a

Facility’s Hourly Emissions Rate.

Congress’s declaration of purposes for the PSD pro-

gram — included in the statute itself — state that the

program was designed “to protect public health and

12

welfare from any actual or potential adverse effect which in

the Administrator’s judgment may reasonably be antici-

pated) to occur from air pollution....” See 42 U.S.C.

§ 7470(1) (emphasis added). It also states that the pro-

gram is intended to “assure that any decision to permit

increased air pollution in any area to which this section

applies is made only after careful evaluation of all the

consequences of such a decision and after adequate proce-

dural opportunities for informed public participation in

the decisionmaking process.” See 42 U.S.C. § 7470(5)

(emphasis added).

These statutory goals, which speak in terms of con-

trolling “actual” air pollution, and “increases” in the same,

are inconsistent with an hourly rate test that would ignore

actual emission increases that threaten public health and

the environment and degrade air quality.

Furthermore, the 1977 legislative history makes it

clear that Congress did not intend to permit aging sources,

whatever their hourly emissions rate, to take up all the

allowable amounts of pollution available to clean air areas,

limiting the ability to develop new industrial plants. As

the Senate explained in 1977, “|t}he chief tool to be used in

implementing the no significant deterioration require-

ments is the permit that must be issued by the State for

any major emitting facility to be located in any clean-air

area, including Federal lands.” S. Rep. No. 95-127, at 32

(1977). See also H.R. Rep. No. 95-294, at 9 (1977) (“The

purpose of the [PSD] permit is to assure that the allowable

increments and allowable ceilings will not be exceeded as

a result of emissions from any new or modified major

‘stationary source.”). Use of the legislative history to

discern Congressional intent is particularly appropriate in

the case of the complex Clean Air Act, as this Court has

13

recognized. It has looked to the legislative history to

determine Congressional intent under the Act in, by our

count, in fourteen of the twenty most recent cases in which

the Court has interpreted the Act. See, e.g., Pennsylvania

v. Del. Valley Citizens’ Council for Clean Air, i°3 U.S. 711,

723 (1987) (considering factors endorsed ty Congress);

Chevron, 467 U.S. at 851 (looking to the legislative history

to determine Congressional intent); Ruckelshaus v. Sierra

Club, 463 U.S. 680, 683 (1983) (using legislative history to

establish Congress’s designation of discretionary author-

ity); Harrison v. PPG Indus., 446 U.S. 578, 589-590 (1980)

(declining to adopt a statutory interpretation based on a

lack of support in the legislative history); see generally

League of United Latin American Citizens v. Perry __

S.Ct. __, 2006 WL 1749637 (June 28, 2006) (Kennedy, J.)

(turning to “the legislative history [of the Voting Rights

Act] identifies factors that courts can use . . . in interpret-

ing” the meaning of a section of the statute).°

* The D.C. Circuit has acted similarly. Between 1995 and the

present, the D.C. Circuit has turned to the legislative history to

understand Congressional intent in ten out of fourteen cases (71.4%)

involving Clean Air Act rulemaking. See New York, 443 F.3d at 885

(finding that legislative history did not support an expansive meaning

of the word “any”); Cir. for Energy & Econ. Dev. v. Envtl. Prot. Agency,

398 F.3d 653, 660 (D.C. Cir. 2005) (finding that all the legislative

history references pertain to § 169A and Congress's addition of § 169B

clarified that the focus of the Clean Air Act was to achieve “actual

progress and improvement in visibility.”); Nat? Wildlife Fed’n v.

Browner, 237 F.3d 670, 675 (D.C. Cir. 2001) (finding that the legislative

history suggested that Clean Air Act § 509(b)(1) was a venue provision,

not jurisdiction provision); George E. Warren Corp. v. U.S. Envt'l. Prot.

Agency, 159 F.3d 616, 623 (D.C. Cir. 1998) (using the congressional

record to establish that the Clean Air Act “reflects a legislative com-

promise between two potentially conflicting goals — avoiding degrada-

tion of air quality and not disrupting the market for conventional

gasoline.”); Clean Air Implementation Project v. Envt'l. Prot. Agency,

(Continued on following page)

14

The legislative history further demonstrates that

Congress intended for the PSD program to promote

economic growth by ensuring that existing sources, if

modified, would not consume all available PSD increment,

thereby preventing new sources from constructing in an

area. As the Senate explained:

In the long run, the growth potential of these

clean-air areas may be quickly filled without a

reasonable policy to prevent significant deterio-

ration. The first new source built in an area

would often absorb the entire available air re-

source, leaving no capacity for future expansion

or growth. Under the policy to prevent significant

deterioration in this bill, the growth options

should be enlarged. This is because the provision

requires that any major source be constructed to

utilize the best available control technology. This

should usually leave room for additional growth.

150 F.3d 1200, 1202 (D.C. Cir. 1998) (“Section 113 deals with federal

enforcement of emission standards and, according to its legislative

history, was amended to enhance EPA’s enforcement powers.”); Motor &

Equip. Mfrs. Ass'n v. Nichols, 142 F.3d 449, 463 (D.C. Cir. 1998) (finding

that the House Report shows that Congress intended to give California

the broadest possible discretion to select the best means to protect its

citizens); Texas Mun. Power Agency v. EPA, 89 F.3d 858, 867 (D.C. Cir.

1996) (noting House Report No. 294 described Clean Air Act § 307(b\ 1)

as a venue provision); EDF, Inc. v. EPA, 82 F.3d 451, 463 (D.C. Cir.

1996) (looking to see if the legislative history of the statute could

provide guidance on general conformity rule, on finding it didn’t,

turning to the language of the statute) Nat? Res. Def. Council v.

Browner, 57 F.3d 1122, 1128 n.8 (D.C. Cir. 1995) (finding the legislative

history contrary to the NRDC statutory interpretation.).

15

S. Rep. No. 95-127, at 31 (1977). The Senate Committee

explained that it should be up to the community where a

source proposed to construct to decide whether to allow the

source to increase emissions such that increment is con-

sumed. Specifically, the Senate Report states:

This directive enables the State to consider the

size of the plant, the increment of air quality

which will be absorbed by any particular major

emitting facility, and such other considerations

as anticipated and desired economic growth for

the area. This allows the States and local com-

munities to judge how much of the defined in-

crement of significant deterioration will be

devoted to any major emitting facility. If, under

the design which a major facility proposes, the.

percentage of the increment would effectively

prevent growth after the proposed major facility

was completed, the State or community could re-

fuse to permit construction, or limit its size. This

is strictly a State or local decision: this legisla-

tion provides the parameters for that decision.

S. Rep. No. 95-127, at 31 (1977).

But under the Fourth Circuit’s rule, these sorts of

determinations by the states would be impossible in

jurisdictions where emissions-increasing changes to old

sources proceed without NSR review, thus using up all the

states’ available increment, and preventing new, economi-

cally desirable and environmentally efficient sources from

coming on line. Congress plainly did not intend such an

outcome.

16

Related statutory provisions detailing what a source

must demonstrate as a prerequisite to obtaining a PSD

permit further emphasize the ambient air quality focus of

the NSR program.

For example, the statute elsewhere requires permit

applicants to measure their air pollution from their source

on an annual basis. It requires the owner or operator of a

proposed new source or modification to demonstrate that

emissions will not “cause, or contribute to” a significant

increase in air pollution beyond the “baseline concentra-

tion of such pollutants.” See 42 U.S.C. § 7474(a)(2)(B).

“Baseline concentration” is defined as “the ambient con-

centration levels which exist at the time of the first appli-

cation for a permit in an area subject to this part.” 42

U.S.C. § 7479(4) (emphasis added).

The statute further provides that issuance of a permit

“shall be preceded by an analysis ... of the ambient air

quality at the proposed site and in areas which may be

affected by emissions from such facility for each pollutant

subject to regulation under this chapter which will be

emitted from such facility.” 42 U.S.C. § 7475(e1) (empha-

sis added). That analysis “shall include continuous air

quality monitoring data gathered for purposes of deter-

mining whether emissions from such facility will exceed

the maximum allowable increases or the maximum allow-

able concentration permitted under this part.” 42 U.S.C.

§ 7475(e)(2) (emphasis added). The Act specifies that the

monitoring data should be “gathered over a period of one

calendar year preceding the date of application for a

permit.” Id. (emphasis added).

17

III. The Respondents’ Reading of “Modification”

Would Frustrate the Policies of the Clean Air

Act.

A. The Actual Annual Emissions Test in EPA’s

PSD Regulations is Needed to Effectuate

the Objective of the PSD Program.

Regulation of those changes that cause a stationary

source to increase its actual annual emissions, rather than

only those changes that incease hourly emissions rates, is

necessary to accomplish the objectives of the PSD program

set forth by Congress. Statutes should not be interpreted

in ways that would thwart their objectives. See U.S.

Airways v. Barnett, 535 U.S. 391, 397 (2002) (rejecting a

reading under which statutory provision “could not accom-

plish its intended objective”); Barnhart v. Peabody Coal

Co., 537 U.S. 149, 159 n.6 (2003) (rejecting an interpreta-

tion that would “thwart the statute’s object”); United

States v. Navajo Nation, 537 U.S. 488, 508 (2003) (reject-

ing a reading that was “out of line with one of the statute’s

principal purposes”). Congress focused Section 111(a) on

whether a modification would cause increases in the

amount of air pollution emitted by a source and Section

165 on whether new construction on a major emitting

facility would lead the facility to cause, or contribute to

excess air pollution. 42 U.S.C. §§ 7411(a), 7503(a)(3).

Moreover, Congress created the PSD program to prevent

such increases from significantly deteriorating air quality.

See 42 U.S.C. § 7470 (listing five statutory purposes of the

PSD program, each of which includes air quality, see infra

Section III.B.). But under the Fourth Circuit’s test, a

source could greatly increase its actual emissions of

harmful air pollutants through construction that would

allow increased hours of operation, so long as that

18

construction does not change the emitting unit’s capacity

to emit.

These Congressional objectives for the PSD program

cannot be accomplished through the hourly emissions rate

test desired by the industry respondents. As lower courts

faced with applying the PSD provisions have noted, the

PSD program “focuses on where the plant will be located

and its potential effect on the environs,” Citizens for Clean

Air v. Envtl. Prot. Agency, 959 F.3d 839, 849 (9th Cir.

1992). Indeed, the PSD program demands a site-specific

review of whether a proposed major source will! contribute

to a significant degradation of local air quality despite

compliance with the NSPS. See 42 U.S.C. § 7470(1).

Accordingly, the PSD program addresses changes to

stationary sources in terms of actual amounts rather than

hourly rates in order to prohibit changes to stationary

sources that will lead to larger potential effect on the

environs, through increased rates, longer hours of opera-

tions, or any other changes that may contribute to a

significant degradation of local air quality.

B. The Purpose of the Nonattainment New

Source Review Provisions of the Statute

Would Also Be Thwarted If the Act Was In-

terpreted to Permit Measurement of Pollu-

tion Through an Hourly, Instead of Actual

Annual Emissions Rates.

In addition to being inconsistent with the PSD pro-

gram, the hourly test embraced by the Fourth Circuit is

inconsistent with the statute’s nonattainment new source

19

review provisions.” The nonattainment portions of the Act

depend upon the ability of states to adopt pollution control

strategies that focus on annual emissions. The hourly

emissions rate test adopted by the Fourth Circuit threat-

ens to crowd these actual-emissions-based state plans out,

upsetting the balance in the federal-state relationship that

is crucial to the operation of the Act.

The Act requires each State to include a nonattain-

ment New Source Review permit program in its plan to

implement the NAAQS. See 42 U.S.C. § 7410(a)(C) (plans

must include “regulation of the modification and construc-

tion of any stationary source within the areas covered by

the plan as necessary to assure that national ambient air

quality standards are achieved, including a permit pro-

gram” including permitting requirements for sources in

nonattainment areas).

The adoption of these “State Implementation Plans”

requires the establishment of attainment inventories, with

enforceable plans approved to meet those inventories.

Attainment inventories catalogue criteria pollutants in

terms of actual emissions in tons per year. See 42 U.S.C.

§§ 7502(c\3)-(4) (SIPs must include a “comprehensive,

accurate, current inventory of actual emissions from all

sources”). Reliance on hourly capacity-based tests would

allow significant increases in actual, annual emissions to

escape NSR controls. As states have noted, these increases

under a potentials-based test will disrupt their attainment

and maintenance effort.

* Those provisions are applicable to areas that are violating the

National Ambient Air Quality Standards (NAAQS).

20

The balance between state and federal control struck

in the Act is an important one, and one that Congress

carefully struck in the 1977 Amendments. See Ronald H.

Rosenberg, Cooperative Failure: An Analysis Of Intergov-

ernmental Relationships And The Problem Of Air Quality

Non-Attainment, 1990 Ann. Surv. Am. L. 13, 25 (describing

the 1977 Amendments as consistent with a “general

pattern of state planning and federal supervision”). The

Act is founded on principles of cooperative federalism, and

the Fourth Circuit’s rule would upset that balance. See

Duke Energy Corp., 411 F.3d at 550 (finding that the EPA

must interpret the term “modification” congruently for use in

the NSPS and PSD programs); see also Stewart v. Abend, 495

U.S. 207, 230 (1990) (“[I]t is not our role to alter the delicate

balance Congress has labored to achieve.”).

Other aspects of the part of the Act designed to apply

to especially polluted states make clear that the 1977

Amendments were designed to curtail, rather than ignore,

those emission increases that could negatively impact

ambient air quality. Specifically, in addition to controlling

emissions te the “lowest achievable emissions rate,” 42

U.S.C. § 7503(a)(2), the permit applicant must, among

other things:

e obtain “sufficient offsetting emissions reductions

... such that total allowable emissions from existing

sources in the region . . . will be sufficiently less than

total emissions from existing sources ... prior to the

application for such permit ... so as to represent ...

reasonable further progress” in attaining NAAQS com-

pliance. 42 U.S.C. § 7503(a)(1)A). Such offsets “shall

assure that the total tonnage of increased emissions of

the air pollutant from the new or modified source shall

be offset by an equal or greater reduction, as applicable,

in the actual emissions of such air pollutant from the

21

same or other sources in the area.” 42 U.S.C.

§ 7503(c)(1); and

e undertake “an analysis of alternative sites, sizes,

production processes, and environmental control tech-

niques for such proposed source [‘hat] demonstrates

that benefits of the proposed source significantly out-

weigh the environmental and social costs imposed as

a result of its location, construction, or modification.”

42 U.S.C. § 7503(a)(5).

The nonattainment NSR provisions in these ways

turn on actual emissions, instead of hourly rates. But the

Fourth Circuit’s rule would make hourly rates the cur-

rency in NSR. Such a conclusion is impossible to square

with the way the nonattainment NSR portions of the

statute address emissions — on an actual, annual basis.

C. The Fourth Circuit’s Rule Would Lengthen

the Lives of Old, High-Pollution Sov-rces

Contrary to Congress’s Intent.

The use of the hourly rate would encourage the

continued use vf outdated, older, “grandfathered” facilities

operating with little or no air pollution control well into

the future. As the Act’s legislative history demonstrates,

however, Congress’s decision to allow these sources to

continue operating without NSR controls was based on the

expectation that many “older units fac[e] retirement in 10-

15 years,” meaning that they would have to be refurbished

— and controlled — if they were to continue operating. See

H.R. Rep. No. 94-1175, at 159 (1976). In recognition of this

congressional intent, Alabama Power held that “(t]he

statutory scheme intends to ‘grandfather’ existing indus-

tries; but the provisions concerning modifications indicate

that this is not to constitute a perpetual immunity from all

22

standards under the PSD program.” 636 F.2d at 400; see

also New York I, 413 F.3d at 27 (same).

Perpetual immunity — the practical consequence of the

Fourth Circuit’s rule — is the opposite of what Congress

intended. For example, while the 1977 House report

acknowledged that for “some of the older and smaller

sources, it is not physically or economically feasible to

retrofit” pollution controls, it also noted that those sources

were exactly the sort of sources with limited useful lives

and short futures. See, e.g., H.R. Rep. No. 94-1175, at 159

(1976) (“[I]t is imprudent to backfit FGD [a control tech-

nology] into existing plants, especially older units facing

retirement within 10-15 years.”) See also S. Rep. No. 95-

127, at 128 (1977) (“There are in the United States ap-

proximately 200 old coal-fired power plants over 20 years

of age. ... Most will be totally phased out of operation in

the next 5 to 20 years.”) (additional views of Sen. Baker).

A perpetual immunity for old, high-emitting plants, is

unlikely to result in cleaner air. Indeed, permitting older

plants to be run harder and longer at the same generous

hourly emissions rates that they have been operating

under since the advent of the Act would circumvent its

purpose. Per megawatt hour (MWh) of electricity pro-

duced, coal-fired plants built before 1950 emitted an

average of 20.58 pounds of sulfur dioxide per MWh of

electricity produced, while coal-fired power plants built

after 1999 emitted only 3.88 pounds.’ The average nitro-

gen oxide emission rate for pre-1950 plants was 5.51

* National Research Council, Interim Report of the Committee on

Changes in New Source Review Programs for Statutory Sources of Air

Pollutants, tbl. 3-3(b) (Natl Academies Press 2005), available at

www.nap.edu/books/0309095786/html.

23

pounds per MWh, while for post-1990 plants the rate was

3.51.° Permitting these plants to operate forever at their

high emission rates retards capital turnover; 57% of all

power plants in the United States were built before 1972,

while 35% are more than 50 years old.’

Congress considered and rejected expanding the scope

of grandfathering in the 1990 Amendments to the Clean

Air Act. During the debate on what kind of emissions

controls to impose on older plants, Senator Chafee, the

Ranking Member of the Senate Environmental and Public

Works Committee and floor manager for the 1990 CAA

revisions, observed: “The rationale that is behind permit-

ting these old plants to emit is first of all, they are ineffi-

cient, and at some point they are so inefficient they are

going to be replaced. And there you come in with a new

plant and a clean plant.” 136 Cong. Rec. S. 3717, 3726

(1990), reprinted in Legislative History of the Clean Air

Act Amendments of 1990, at 6946, 6970 (1993) (statement

of Sen. Chaffee, Senate Debate on S. 1630). “A [floor]

statement of one of the legislation’s sponsors . . . deserves

to be accorded substantial weight in interpreting the

statute.” Fed. Energy Admin. v. Algonquin SNG, Inc., 426

U.S. 548, 564 (1976).”°

* Id. at 81, tbl. 3-3a. Accordingly, “a bias towards older capital is a

bias against better pollution control equipment and a perpetuation of

pollution externalities.” Shi-Ling Hsu, The Real Problem with New

Source Review, 26 Envt'l. L. Rep. 10098 (2006).

* U.S. General Accounting Office, Emissions From Older Electricity

Generating Units 2 (2002).

* See also American Trucking Ass'n, Inc. v. ICC, 697 F.2d 1146, 1149

(D.C. Cir. 1983) (Scalia, J.) (relying on floor statements as part of the

relevant legislative history of a statute); Southeast Shipyard Ass'n v.

United States, 979 F.2d 1541, 1546 (D.C. Cir. 1992). Sponsor statements

(Continued on following page)

24

However, “[t]he flaw,” Chafee explained, is that “we

are not seeing the end of these plants. We are not seeing

them go either out or to be reused in a very reduced

fashion.” Jd. Congress accordingly rejected attempts to

relax the new source review process; now the Fourth

Circuit has done what Congress eschewed in 1990.

In fact, several Senators wrote to Conference Commit-

tee Chair Senator Baucus specifically urging the adoption

of a rule that would “[a]llow utilities to undertake needed

repairs at an existing unit without triggering an obligation

to meet stringent new source performance standards.” 136

Cong. Rec. S. 17429, 17429 (1990), reprinted in Legislative

History of the Clean Air Act Amendments of 1990, at 731,

1087 (1993). The Conference Agreement version of S. 1630,

however, omitted such a change. Senator Mitchell, speak-

ing during the Conference Report floor debate, explained

why:

In 1970, the Clean Air Act required that new

sources meet tight emission standards. At that

time, it was assumed that electric utility units

had an average lifetime of 30 years. But many

utilities are now choosing to extend the life of

their plants rather than meet the new source

“greatly aid in making the [statute’s] purpose apparent.” Max Radin, A

Short Way With Statutes, 56 Harv. L. Rev. 388, 411 (1942); see also Pub.

Employees Ret. Sys. v. Betts, 492 U.S. 158, 179 (1989) (giving weight to

Senator Yarborough’s views on the construction of the Age Discrimina-

tion in Employment Act because he was a sponsor). See also Pacific Gas

& Elec. Co. v. Energy Res. Conservation & Dev. Comm’n, 461 U.S. 190,

220 n.23 (1983) (relying on a 1965 explanation by “an important figure

in the drafting of the 1954 |Atomic Energy] Act”); Nat’? Endowment for

the Arts v. Finley, 524 U.S. 569, 582 (1998) (sponsors’ statements);

Conroy v. Aniskoff, 507 U.S. 511, 516-7 & n.12 (1993) (sponsors’

statements).

25

performance standards mandated under current

law. This development has exacerbated our pollu-

tion problems and made national acid rain con-

trols even more necessary. Some dpproaches ...

would again shield utilities from meeting new

source standards — and postponing needed emis-

sion reductions — even though such utilities may

in essence be rebuilding their units.

136 Cong. Rec. S. 16895, 16904 (1990), reprinted in Legis-

lative History of the Clean Air Act Amendments of 1990, at

731, 791 (1993).

The 1990 debate provides more evidence that Con-

gress knew that the older plants would provide more than

their share of pollution for the remainder of their lives.

However, Congress clearly expected that the end of those

lives would not be far away. Permitting plants to enjoy the

benefit of old-plant emissions standards with entirely new

plant equipment would not be consistent with Congress’s

intent in establishing the PSD and nonattainment NSR

programs.

26

CONCLUSION

For the foregoing reasons, the Court should reverse

the Fourth Circuit's decision.

Respectfully submitted,

DAVID ZARING

WASHINGTON AND LEE UNIVERSITY

SCHOOL OF LAW

Lewis Hall

Lexington, Virginia 24450

(540) 458-8301

STEPHANIE TAI

(Counsel of Record)

THE UNIVERSITY OF WISCONSIN

LAW SCHOOL OF LAW

975 Bascom Mall

Madison, Wisconsin 53706

(608) 890-1236