Respondents Brief — Michigan v. Envtl. Prot. Agency, 135 S. Ct. 702 (2014) (No. 14-46)

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Nos. 14-46; 14-47; 14-49

IN THE

Supreme Court of the United States

STATE OF MICHIGAN, et al.,

Petitioners,

and

UTILITY AIR REGULATORY GROUP

Petitioner,

and

NATIONAL MINING ASSOCIATION,

Petitioner,

ENVIRONMENTAL PROTECTION AGENCY, et al,

Respondents.

On Waits or CERTIORARI TO THE Unrrep States Courr

OF APPEALS FOR THE District oF CoLumBia CiRcurr

BRIEF OF RESPONDENTS AMERICAN

ACADEMY OF PEDIATRICS, ET AL.

Sanjay NARAYAN SEAN H. DonaHUE

Srerra CLuB Counsel of Record

85 Second St., 2nd Floor Davip T. GOLDBERG

San Francisco, CA 94105 DoNAHUE & Go_pBERG, LLP

1130 Connecticut Avenue, NW

JAMES S. PEw Suite 950

Ne. E. GoRMLEY Washington, D.C. 20036

EARTHJUSTICE (202) 277-7085

1625 Massachusetts Ave. NW sean@donahuegoldberg.com

Suite 702

Washington, D.C. 20036 Counsel for Respondents

’ American Academy of

Pediatrics, et al.

‘tion: ; ‘nm si of Congress

(Additional counsel listed in signature bloclybrary inom

QUESTION PRESENTED

Whether the Environmental Protection Agency

unreasonably refused to consider costs in determining

whether it is appropriate to regulate hazardous air

pollutants emitted by electric utilities.

RULE 29.6 STATEMENT

Respondents American Academy of Pediatrics,

American Lung Association, American Nurses

Association, American Public Health Association,

Chesapeake Bay Foundation, Citizens for

Pennsylvania’s Future, Clean Air Council,

Conservation Law Foundation, Environment

America, Environmental Defense Fund, Izaak Walton

League of America, National Association for the

Advancement of Colored People, Natural Resources

Council of Maine, Natural Resources Defense

Council, Ohio Environmental Council, Physicians for

Social Responsibility, Sierra Club, and Waterkeeper

Alliance, all of which were respondent-intervenors in

the court of appeals, are nonprofit public interest

organizations. None of them has any corporate

parent, and no publicly held corporation owns an

interest in any of them.

TABLE OF CONTENTS

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RULE 29.6 DISCLOSURE STATEMENT ................ ii

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Ts one anancelnaidnenemaninionniaeaiiintelonns 3

A. The History of Section 7412.....................0.... 4

B. Section 7412’s Regulatory Process ................ 5

C. Subparagraph 7412(n)(1)(A) and

RARE RE ETE eek eee eRe 6

D. EPA’s Appropriate and Necessary

ENE SREI EEE ISR LL DOE Pe 7

E. The Rule’s Public Health Benefits ............... 12

F. Court of Appeals Proceedings ....................... 13

SUMMARY OF ARGUMENT...................cccccccseeeeesees 14

EIU itchasessiciicakccmnmepatonedstendennseoniiseervsionessiveaied 16

I. The Statute Provides Overwhelming Support

for EPA’s Conclusion That, Under Subparagraph

7412(n)(1)(A), Costs Should Not Be Considered

in Determining Whether to Regulate

I I cicense nc pnnqeieiitinmenesannndeadonunnidiae 16

A. The Text of Paragraph 7412(n)(1) Strongly

Supports EPA’s Reading...........................6+. 16

B. Section 7412 as a Whole Confirms That

EPA’s Interpretation is Reasonable ............ 21

lil

1. Subsection 7412(b) Reflects Congress’s

Determination That Hazards From

Listed Pollutants Warrant Regulation

RY III FI iccestcamesitacicocisncsceniccn 21

2. Subsection 7412(c)’s Provisions For

Listing and Delisting Source Categories

Further Support the Reasonableness of

EPA’s Statutory Interpretation............. 22

3. In Subsection 7412(d), Congress

Specified When and How EPA Is to

Consider Costs When Regulating Under

I PI iicceiasussitanitscutestchnembidannnoseniods 24

a. Subsection 7412(d) Provides for

Consideration of Costs, Expressly

and in a Particular Manner............ 24

b. Subsection 7412(d)’s Achievement-

Based Criteria Represent a

Deliberate Congressional Choice to

Constrain the Role of Costs............. 26

c. Section 7412(d)’s Limitations on

EPA’s Discretion Reflect Congress’s

Judgment Regarding the Severity of

the Health Risks Posed by Air

MIE cra sccudcadacamisunananchen tanmannaneics 28

4. EPA’s Interpretation Is Consistent

with Subsection 7412(f) ..................000000 29

C. The Clean Air Act as a Whole Confirms that

EPA’s Interpretation is Reasonable ............ 31

II. EPA Has Given Full Effect to Subparagraph

PI gsaosdscpecescecaecnssscdeiaausennceneseenens 33

Ill. EPA’s Interpretation Does Not Lead to

Unreasonable or Absurd Results .......................

A. EPA’s Interpretation Does Not Permit

I ia

B. The Rule Is Not Evidence of an

Unreasonable Interpretation.......................

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TABLE OF AUTHORITIES

Cases:

Am. Textile Mfrs. Inst. v. Donovan,

I ee Se Ro veiintacecdiedseiitahecenstectoiccs 18, 26

Caraco Pharm. Labs., Ltd. v. Novo Nordisk A/S,

I es Gees i I iiviscinicacisinsssnesxeninseiersnsianci 20

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

Oe din siccishesnsibinasanainbenasenbunateinnnn 43

Entergy Corp. v. Riverkeeper, Inc.,

556 U.S. 208 (2009) ................ccccsccocseeeees 17, 18, 42

EPA v. EME Homer City Generation, L.P.,

ee ie I cirstetitansnaseciccovncivsmmvennncnnee 32

Lead Indus. Ass'n, Inc. v. EPA,

647 F.2d 1130 (D.C. Cir. 1980) ...................000... 19

Massachusetts v. EPA, 549 U.S. 497 (2007)......... 19

Mississippi ex rel. Hood v. AU Optronics Corp.,

re ee i 19

NRDC v. EPA, 824 F.2d 1146 (D.C. Cir. 1987)..... 30

New Jersey v. EPA, 517 F.3d 574 (D.C. Cir. 2008),

cert. denied sub nom. Util. Air Reg. Grp. v.

New Jersey, 555 U.S. 1169 (2009) ...........0000000.. fe)

RadLAX Gateway Hotel v. Amalgamated Bank,

rn Os a 25

Sierra Club v. EPA,

479 F.3d 875 (D.C. Cir. 2007) ........0.0.00.ccceeeeeees 42

Sossamon v. Texas,

a TR a rey ee 17

Whitman v. Am. Trucking Ass'ns, Inc.,

Re Ry I iii eisecilaceensazends passim

Statutes:

42 U.S.C.

42U S.C.

42 U.S.C.

42 US.C.

42 U.S.C.

42. U.S.C.

42 U.S.C.

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vii

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OE eh 7

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Administrative Materials:

65 Fed. Reg. 79,825 (Dec. 20, 2000)................ passim

70 Fed. Reg. 15,994 (March 29, 2005)...................- 8

76 Fed. Reg. 24,976 (May 3, 2011) ................. passim

77 Fed. Reg. 9304 (Feb. 12, 2012)................... passim

Vill

Legislative History:

House Rep. No. 101-490 (1990) ...................000085 4, 28

eS BG: 1). ee passim

Legislative. History of the Clean Air Act

Amendments ...... of 1990 (Cong. Research Serv.

BOI vce ccc cisvssiensvscsncnitteninelichcinnmadanecaeaee passim

Miscellaneous:

Executive Order 12,866, 58 Fed. Reg. 51,735

Ree 12

Executive Order 13,563, 76 Fed. Reg. 3821

A ) tr a he 12

Office of Management and Budget,

Circular A-4 (Sep. 17, 2003) ..................ccescce0s. 40

New Oxford American Dictionary

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Webster’s Third New International

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INTRODUCTION

EPA’s Air Toxics Rule limits emissions of

hazardous air pollutants from coal- and oil-fired

electric generating units (“EGUs” or, colloquially,

power plants). These units annually emit large

amounts of many different pollutants designated by

Congress as “hazardous” under the Clean Air Act,

including arsenic, cadmium, chromium, hydrochloric

acid gas, hydrogen cyanide gas, mercury, nickel, and

selenium. Power plants’ emissions of mercury and

several other toxics dwarf those of the next-largest

source categories (and, in some cases, far exceed

emissions from all other sources combined). The

respondent public health, medical professional,

environmental, civil rights, and conservation

organizations intervened below to support the Rule

because it will greatly reduce overal/ nationa/

emissions of mercury and other dangerous air toxics,

thereby securing major, long-delayed gains for

public health.

Based on a voluminous record assembled over two

decades, EPA concluded that regulation of power

plants’ toxic pollution was “appropriate and

necessary within the meaning of 42 U.S.C.

7412(n)(1)(A) and promulgated emissions standards

at levels that scores of such plants were already

meeting. That decision was lawful. EPA reasonably

concluded that the term “appropriate” in

subparagraph 7412(n)(1)(A) did not implicitly require

consideration of the costs of complying with emissions

standards as part of the Agency’s threshold decision

whether to regulate power plants.

The term “appropriate” is context-dependent, and

EPA reasonably read it here to respect, rather than

override, the statute of which it is a part, including its

explicit constraints on when, where, and how costs fit

in the regulatory process. Subparagraph

7412()(1)(A), with its direction to EPA to prepare

and consider a scientific study of “hazards to public

health,” as ‘well as its context in section 7412,

powerfully support EPA’s decision not to address

costs at the threshold stage of deciding whether to

regulate, but *ingtead to address costs within the

feasibility- based jandard- -setting framework that

embodies Crnd s judgment as to how much of a

regulatory burden to impose.

The 1990 Congress that enacted the provision,

intent on reducing toxic emissions after decades of

regulatory paralysis, manifestly believed it

inappropriate to consider costs at the threshold stage;

it provided, for source categories spanning the

entirety of the industrial economy, for costs to be

instead considered, in a carefully described manner,

in the setting of emissions standards. Petitioners’

unguided standard would be entirely alien to

the Act—which consistently requires EPA to take

costs into account when setting standards, but not

when determining whether to regulate particular

sources.

EPA did just what subparagraph 7412(n)(1)(A)

told it to do (albeit far more slowly than Congress

directed): The Agency conducted an exhaustive study

of power plants’ emissions of hazardous air

pollutants, and identified numerous hazards that

were attributable specifically to those emissions and

that persisted, contrary to some predictions in 1990,

despite implementation of other statutory

requirements. Power plants remain huge emitters of

numerous congressionally designated toxics,

including ones that cause permanent neurological

impairment, birth defects, and cancer. EPA afforded

power plants the special, pre-listing evidentiary

inquiries that subparagraph 7412(n)(1)(A) called for,

and the Agency properly followed the record evidence

in deciding to regulate power plant emissions.

STATEMENT

The Clean Air Act provides for the control of

“hazardous air pollutants” (“HAPs”): airborne toxics,

such as mercury, arsenic, cadmium, hydrochloric

acid, and hydrogen cyanide. 42 U.S.C. 7412.

Congress singled out these pollutants for their

“potent” and “especially serious health risks,” even in

relatively small quantities, Legis. History of the

Clean Air Act Amendments of 1990 (Cong. Research

Serv. 1993) (“Leg. Hist.”) at 2,522 (explaining

difference between “hazardous air pollutants” and

“criteria pollutants” addressed elsewhere in the Act)

(House Debate). 42 U.S.C. 7412(b)(1) (list of

pollutants). Those risks include “birth defects,

damage to the brain or other parts of the nervous

system, reproductive disorders, and _ genetic

mutations,” as well as cancer. Leg. Hist. at 2,524

(House Debate). See 42 U.S.C. 7412(b)(2) (air toxics

may be, inter alia, “carcinogenic, mutagenic,

teratogenic, neurotoxic,” “cause reproductive

dysfunction,” or “acutely or chronically toxic”).

A. The History of Section 7412

Congress first sought to address air toxics by

charging EPA to identify which substances posed

harms worthy of regulation, and the level of

regulation that would address those risks. See 42

U.S.C. 7412(a)(1), 7412(b)(1) (1970). That regime

“worked poorly,” largely because EPA was unable to

adequately balance the health risks of air toxics

against the regulatory burdens of reducing them.

Leg. Hist. at 8,468 (S. Rep. No. 101-228 (“Senate

Report”)). Over nearly 20 years, EPA “regulated only

some sources of seven chemicals.” Jd. See id. at 3,175

(“No decision—is the history of this program”) (H.

Rep. 101-490 (“House Report”)).

As a result, in 1990, Congress completely revised

section 7412. Noting EPA’s two-decade failure to

promulgate sufficiently protective standards,

Congress rejected proposals that would have

entrusted EPA with the discretion to balance “health

and economic considerations” against each other.

Leg. Hist at 8,746-47 (EPA would “faill] to protect

public health” in such balancing) (Sen. Lautenberg).

That rejection reflected the special regulatory

difficulties Congress saw as particular to the nature

of air toxics: “[t]he public health consequences of

substances which express their toxic potential only

after long periods of chronic exposure will not be given

sufficient weight in [a] regulatory process when they

must be balanced against the present day costs of

pollution control and its other economic

consequences.” Leg. Hist. at 8,522 (Senate Report).

B. Section 7412’s Regulatory Process

Congress consequently enacted a highly

structured regulatory framework, with strict, non-

discretionary standards, meant to avoid the

“simultaneous balancing of costs and benefits” of

which EPA had proved incapable. /d. at 8,518 (Senate

Report).

First, Congress no longer relied on EPA to identify

pollutants whose harms justified regulation. Instead,

Congress itself created an initial list of 189 hazardous

air pollutants. 42 U.S.C. 7412(b). EPA must review

the list periodically and revise it where “appropriate.”

Id. 7412(b){2). Whether such revisions are

“appropriate” depends entirely on whether emissions

of a given pollutant “may reasonably be anticipated to

cause adverse effects to human health or adverse

environmental effects,” without regard to the costs of

controlling the pollutants. Jd. 7412(b)(3)(B)-(C).

Second, Congress added provisions requiring EPA

to regulate specific sources of the congressionally

identified hazardous pollutants. Congress directed

EPA to list for regulation all categories of sources

whose emissions exceeded specific numeric

thresholds, without consideration of costs. 42

U.S.C. 7412(c)(1) (requiring EPA to list “all categories

and subcategories of major sources”); id. 7412(a){1)

(providing thresholds for major sources). Congress

further provided that source categories may only be

removed from the list based upon a demonstration

that the health or environmental harms resulting

from their emissions fall below a specific threshold, or

are absent altogether. See id. 7412(c)(9).

The third step of the regulatory process requires

EPA to promptly promulgate, for each listed category,

emission standards reflecting the “maximum degree

of reduction in emissions” of air toxics that is

“achievable,” considering—among other factors—

costs. 42 U.S.C. 7412(d)(2). See also id. 7412(c)(2) &

7412(c)(5) (requiring standards within two years of

listing a source category).

Fourth, after those technology-based standards

are in place, EPA must promulgate “residual risk”

standards, to ensure “an ample margin of safety to

protect public health.” 42 U.S.C. 7412(f)(2)(A). Once

it ensures public health is thus protected, EPA may

issue “more stringent” standards, considering

compliance costs and other factors. /d.

C. Subparagraph 7412(n)(1)(A) and Power Plants

Some legislators (and industry representatives)

disputed that power plants’ emissions of air toxics

posed a hazard to public health. £E.g., Leg. Hist. at

1,416 (Rep. Oxley). Alternatively, they suggested

that any such problems might be cured by the Title IV

Acid Rain Program—a market-based system, also

adopted in the 1990 Amendments, intended to reduce

emissions of sulfur dioxide and nitrogen oxides.

Others urged that power plants’ emissions threatened

public health and that it would be “inequitable to

impose a regulatory regime on every industry in

America and then exempt ... a category like power

plants which are a significant part of the air toxics

problem.” Jd. at 871 (Sen. Durenberger).

The result was a compromise provision instructing

EPA, within three years, to “perform a study of the

hazards to public health reasonably anticipated to

occur as a result of emissions by [power plants] of”

listed hazardous air pollutants “after imposition of

the requirements of this chapter.” 42 U.S.C.

7412(n)(1)(A). EPA was also required to “develop and

describe” in a report to Congress “alternative control

strategies for emissions which may warrant

regulation under this _ section.” Id. Finally,

subparagraph 7412(n)(1)(A) states that:

[t]he Administrator shall regulate [power

plants} under this section, if the Administrator

finds such regulation is appropriate and

necessary after considering the results of the

study required by this subparagraph.

The statute’s ensuing subparagraphs require EPA

to transmit to Congress, within four years, another

study—of mercury emissions from power plants,

waste incinerators, and other sources, including

available control technologies and the “costs of such

technologies”—and direct the National Institute of

Environmental Health Sciences to provide Congress a

study of the “threshold level of mercury exposure

below which adverse human health effects are not

expected to occur,” paying special attention to

“sensitive populations.” Jd. 7412(n)(1)(B)-(C).

D. EPA’s Appropriate and Necessary Determination

EPA completed the required Utility Study in 1998

(nearly five years after Congress’s deadline and three

years after initial compliance with Phase I of the Acid

Rain Program). The Utility Study assessed, inter

alia, the hazards remaining after implementation of

the Acid Rain Program, and it found that controls

resulting from that program were “not expected to

significantly impact on HAP emissions due to their

limited numbers, and limited HAP control efficiency

improvement.” JA 106-07.

Considering that study and an extensive record

that also included the two other congressionally-

mandated and peer-reviewed scientific studies, as

well as congressionally-required National Academy of

Sciences research on the toxicological effects of

methylmercury, EPA concluded in 2000 that

regulation of hazardous air pollutant emissions from

coal- and oil-fired power plants “is appropriate and

necessary.” 65 Fed. Reg. 79,829 (Dec. 20, 2000).

EPA determined that it was “appropriate” to

regulate coal- and oil-fired power plants because,

among other reasons, their mercury emissions create

a hazard to public health and the environment and

because several other hazardous metals they emit

pose cancer risks. /d. at 79,827. EPA concluded that

regulation was “necessary” because imposition of

other requirements of the Act had not addressed, and

would not sufficiently address, these hazards. /d. at

79,830. EPA also found that existing technologies

made it “feasible” to control power plants’ air toxics.

Id. at 79,830. Accordingly, EPA added coal- and oil-

fired power plants to the subsection 7412(c) list of

source categories to be regulated. Jd. at 79,830. See

also 76 Fed. Reg. 24,976, 24,997 (May 3, 2011).:

In 2005, EPA finalized a rule that purported to

remove power plants from that list. 70 Fed. Reg.

15,994 (Mar. 29, 2005). That rule determined that

1 EPA determined that regulation of gas-fired power

plants was “not appropriate or necessary” because of the

“negligible” impacts of their hazardous emissions. 65 Fed.

Reg. 79,831.

dangers to public health from power plants’ air toxics

were best addressed through an allowance-trading

system under 42 U.S.C. 7411, for mercury alone, id.

at 16,005; it was vacated in New Jersey v. EPA, 517

F.3d 574 (D.C. Cir. 2008), cert. denied sub nom.

UARG v. EPA, 555 U.S. 1169 (2009).

In 2012, the Agency reaffirmed its “appropriate

and necessary’ determination and promulgated

regulations for power plant hazardous air pollutants.

76 Fed. Reg. 24,976. Significant new scientific studies

and data confirmed “serious health risks from HAP

exposure” despite implementation of other Clean Air

Act programs, and that power plants’ toxic emissions

“pose a hazard to the environment as well.” 77 Fed.

Reg. 9,304, 9,310-11, 9,336, 9,363 (Feb. 16, 2012); 76

Fed. Reg. 24,999, 25,016.

For example, EPA found, based on a peer-reviewed

risk assessment, that power plant emissions of

mercury in 2016 would cause or significantly

contribute to human exposures exceeding safe levels

in nearly a quarter of modeled watersheds “with

populations at-risk,” 77 Fed. Reg. 9,355; and that

power plants were responsible for significantly higher

mercury pollution in the areas nearest to them, 76

Fed. Reg. 25,013. EPA also found that non-mercury

metals like chromium and nickel, emitted by power

plants as particulates, pose cancer risks, jd. at 24,978,

25,011; 77 Fed. Reg. 9,319, and that power plants

continue to be a significant source of these and other

toxic metals, such as arsenic and cadmium, which

have serious health effects, 76 Fed. Reg. 25,003-4,

25,006 tbl. 5. See also 77 Fed. Reg. 9,380 (most non-

mercury metallic toxics are emitted, and best

controlled, as particulates). Recognizing that powe:

plants account for an overwhelming share of the

hydrogen chloride and hydrogen fluoride emitted in

the U.S. (and are significant sources of hydrogen

cyanide), and that these acid gases have serious acute

and chronic health effects, 76 Fed. Reg. 25,004-5, EPA

expressed its concern “about the potential for [power

plant] acid gas emissions to add to already high

atmospheric levels of other chronic respiratory

toxicants,” id. at 25,016. See also77 Fed. Reg. 9,363,

9,405-06.

EPA explained that power plants account for very

large proportions of total U.S. emissions of numerous

hazardous air pollutants listed in 42

U.S.C. 7412(b)(1):

Mercury — 50 percent;

Arsenic — 62 percent;

Cadmium — 39 percent:

Chromium — 22 percent;

Hydrochloric Acid — 82 percent;

Hydrogen Fluoride — 62 percent:

Nickel — 28 percent; and

Selenium — 83 percent.

77 Fed. Reg. 9,310 (percentages of total U.S.

emissions in 2005 inventory). See also id. at 9,337

(noting that power plants remain the “predominant

source” of anthropogenic U.S. mercury emissions,

particularly the oxidized and particulate forms that

are of “primary concern” for public health). EPA

determined that power plants remained in 2012, by a

wide margin, the largest emitters of numerous

hazardous air pollutants. Jd. at 9,335. EPA also

reaffirmed its 2000 finding that “effective controls are

available to reduce” emissions of mercury and other

hazardous pollutants from power plants. Jd. at 9,310-

Ei.

EPA interpreted subparagraph 7412(n)(1)(A) as

requiring the Agency to assess the hazards posed by

power plants’ emissions of air toxics, and to decide

whether other programs would adequately address

any such hazard, in order to determine whether it was

“appropriate and necessary” to regulate power plants’

hazardous air pollution. The Agency concluded that

subparagraph 7412(n)(1)(A) is best read not to

predicate the threshold finding upon _ cost

considerations. 77 Fed. Reg. 9,326-27. It relied, in

part, upon the “overall structure” of the Act and of

section 7412, which does “not authorize the

consideration of costs in listing any source categories

for regulation.” 76 Fed. Reg. 24,989. EPA therefore

rested its decision on identified health and

environmental hazards; the large volume of

hazardous emissions from power plants; the ready

availability of controls to reduce those emissions; and

the confirmed need for their contro] notwithstanding

implementation of the Acid Rain Program and other

Clean Air Act programs. E.g., 77 Fed. Reg. 9,323-24,

9,362-64.

EPA proceeded to promulgate emissions

standards for power plants pursuant to subsection

7412(d), based upon reductions that a substantial

number of existing power plants were already

achieving. 76 Fed. Reg. 25,041-46.

E. The Rule’s Public Health Benefits

EPA explained that the Rule “will reduce

emissions of all the listed HAP that come from EGUs.”

Id. at 9,444. See id. at 9,306 (noting that emissions of

non-mercury hazardous air pollutants will “decrease

dramatically” under the Rule). EPA also found that

the Rule would reduce harm to those currently

exposed to the highest risks, id. at 9,445-46, and

produce “substantial health improvements for

children,” id. at 9,441.

EPA projected that the Rule will yield deep

reductions in aggregate nationwide emissions of

many of the toxics Congress listed in 42 U.S.C.

7412(b)(1), 76 Fed. Reg. 25,013-14, including a 49

percent reduction in all anthropogenic emissions of

hydrochloric acid gas and a 38 percent reduction in

non-mercury metal hazardous air pollutants such as

arsenic, chromium, and nickel, jd. at 25,013-15. The

Rule will reduce power plant mercury emissions by 75

percent, 77 Fed. Reg. 9,424, thereby eliminating over

a third of total national anthropogenic mercury

emissions. 76 Fed Reg. 25,015.

EPA did not conduct a cost-benefit analysis as part

of its appropriate and necessary determination, but it

did examine the Rule’s costs and benefits in a

“Regulatory Impact Analysis,” pursuant to Executive

Orders 12,866 and 13,563.

EPA explained that most of the identified benefits

of the rule—such as most benefits of reducing

mercury pollution, and all benefits of reducing the

other hazardous pollutants—could not be assigned

monetary values, due to methodological and data

limitations. See 77 Fed. Reg. 9306 (noting

“limitations and uncertainties” of monetary figures,

and that “EPA could not monetize some costs and

important benefits”). See also JA 913-23, 940-53.

EPA qualitatively described many of these

“important” non-monetized benefits, 77 Fed. Reg.

9,306 tbl. 2. See 76 Fed. Reg. at 25,050-51 (discussing

health benefits from reductions in acid gases); JA 918

(unquantified health benefits of methylmercury

reductions relating to “cancer, reproductive and

genotoxicity” and “other neurological delays—

developmental delays, memory, behavior”); JA 914-23

(enumerating categories of benefits); D.C. Cir. JA

2368-79 (discussing health harms attributable to non-

mercury metal and acid gas pollutants controlled by

the Rule).

EPA nonetheless concluded that even the subset of

the Rule’s benefits that could be monetized would

many times exceed the Rule’s costs, estimating total

annual benefits of $33-90 billion, and costs of $9.6

billion, 77 Fed. Reg. 9305-06. Most of these

“monetizable” benefits were associated with

reductions in particulate matter, which contains

metal hazardous air pollutants, but has health

impacts extending beyond the discrete harms of those

toxic metals. The Rule is expected to prevent between

4,200 and 11,000 premature deaths, 4,700 non-fatal

heart attacks, and 540,000 days of work lost to

asthma and other respiratory illnesses, each year. /d.

at 9,429.

F. Court of Appeals Proceedings

Upon petitions for review filed by industry, States,

and environmental groups, the court of appeals

upheld the Rule in its entirety, with one judge

dissenting in part. Pet. App. 1a.

SUMMARY OF ARGUMENT

Petitioners argue that EPA erred by not weighing

estimated compliance costs as part of the threshold

inquiry into whether it was “appropriate and

necessary” to regulate power plants. Faced with the

absence of any direct instruction that EPA consider

costs during that inquiry, petitioners resort to a

variety of ostensibly “contextual” arguments,

claiming variously that paragraph 7412(n)(1), section

7412 as a whole, or the Act in its entirety, contain an

implicit mandate that EPA undertake a cost-benefit

assessment before finding it “appropriate and

necessary to regulate power plants. Those

arguments are meritless.

Subparagraph 7412(n)(1)(A) expressly requires

the Administrator to consider one factor, prior to

determining the ‘appropriateness’ of regulation:

“hazards to public health” from EGU emissions,

following imposition of the Act’s other requirements.

The broader context of section 7412 also supports

EPA’s decision. It evinces Congress’s central concern

with public health and environmental effects, as well

as congressional direction as to how, and when, costs

should be considered by the Agency—not in the

threshold determination whether particular sources

should be subjected to regulation, but in the setting of

emissions standards, subject to defined constraints.

EPA decision to address costs when setting

emission standards, rather than when determining

whether a category of sources should be regulated at

all, is congruent with the structure of the Clean Air

Act’s other regulatory programs. In each of those

programs, costs are not a consideration at the

threshold when EPA decides whether to regulate

sources, but are considered during standard-setting,

when the Agency decides how much to regulate.

EPA’s interpretation gives full effect to the

“appropriate and necessary” provision, emphasizing

the key legislative concerns underlying subparagraph

7412()(1)(A): claims that EGUs’ emissions did not

present a health hazard, and that the Acid Rain

Program established by the 1990 Amendments might

eliminate any such hazard. Based on an exhaustive

review, EPA found that power plants’ emissions of

hazardous pollutants remain an important public

health hazard which would not be remedied by other

provisions in the Act. That is exactly what Congress,

in subparagraph 7412(n)(1)(A), asked the

Administrator to address.

Finally, petitioners’ claims that EPA's

interpretation leads to irrational or absurd results are

groundless. EPA considered costs under the

standard-setting regime that Congress required for

dozens of other industries, big and small. That

regime does not reflect a disregard of costs, but rather

the balance struck by Congress between the benefits

of protecting the public from harm, and the costs to

industry such protection entails. Petitioners’ claims

that the Air Toxics Rule itself is excessively and

unreasonably costly mischaracterize the record.

By causing major overall reductions in numerous

air toxics, the Rule will importantly reduce serious

hazards to the public. Those hazards, the record

demonstrates, are particularly acute for vulnerable

groups, including children who can _ suffer

debilitating, lifelong effects as the result of

unconsented-to exposure to hazardous pollutants like

mercury. See 76 Fed. Reg. 25,018-19. Despite

petitioners’ creative efforts to define them away, the

Rule’s benefits to the public health are substantial,

and include exactly the benefits Congress enacted the

hazardous air pollution provisions to secure.

ARGUMENT

I. The Statute Provides Overwhelming Support for

EPA’s Conclusion That, Under Subparagraph

7412(n)(1)(A), Costs Should Not Be Considered in

Determining Whether to Regulate Power Plants.

A. The Text of Paragraph 7412(n)(1) Strongly

Supports EPA’s Reading.

Subparagraph 7412(n)(1)(A) does not mention

costs. It provides that EPA “shall” regulate power

plants under section 7412 if the Administrator finds

such regulation “appropriate and necessary” after

considering the results of a study assessing “the

hazards to public health reasonably anticipated to

occur as a result of emissions by [power plants) of

[listed pollutants) ... after imposition of the

requirements of this chapter.”

This language strongly supports EPA’s view that

costs should not be considered during the threshold

decision whether to regulate power plants. Congress

specified one factor that EPA must consider in

deciding whether regulation of power plants is

“appropriate and necessary.” That factor is not costs,

but “hazards to public health” from power plants’

emissions of listed pollutants. Had Congress meant

to mandate consideration of another factor, it very

likely would have said so. See Whitman v. American

Trucking Ass’n, 531 U.S. 457, 465 (2001) (because

“(nlowhere are the costs of achieving [a] standard

made part of [an] initial calculation,” natural reading

does not compel consideration of costs); see also

Entergy Corp. v. Riverkeeper, 556 U.S. 208, 222

(2009) (construing Clean Water Act provision’s

silence concerning cost “to convey ... a refusal to tie

the agency’s hands as to whether cost-benefit analysis

should be used”).

Without any statutory text directing EPA’s

attention to costs, petitioners are relegated to arguing

that a cost-consideration mandate is imposed by the

term “appropriate.” They assert that, by use of that

term, Congress meant to obligate EPA to consider at

the initial stage “all possibly relevant factors,” NMA

Br. 22, which they claim necessarily include “both the

costs and benefits of regulating,” Michigan Br. 21.

See also UARG Br. 32.

But the term “appropriate” has no such rigidly

fixed meaning; it is “inherently context-dependent.”

Sossamon v. Texas, 131 S. Ct. 1651, 1659 (2011). See

id. (“specially suitable: fit, proper”) (quoting

Webster’s Third New International Dictionary 106

(1993)). See also 77 Fed. Reg. 9326 (“The term

‘appropriate’ carries with it the connotation of

something that is ‘suitable or proper in the

circumstances.”) (citing New Oxford American

Dictionary (2d Ed. 2005)). When one asks whether a

book is appropriate for a fourth grader, or whether a

black dress is appropriate for a wedding, context

shows what the operative criteria are. And when we

tell someone—as Congress here directed the EPA

Administrator—to take some action if she “finds it

appropriate,” we are plainly calling on that person to

identify and apply those criteria.

Because the term: “inherently” compels attention

to context, Sossamon, 131 S. Ct. at 1659, the common

understanding of “appropriate” does not always, or

even usually, require consideration of “ali possibly

relevant factors,” NMA Br. 22, including “both the

costs and benefits.” Michigan Br. 21. As used in

subparagraph 7412(n)(1)(A), “appropriate” is best—

and, a fortiori, permissibly—read as not extending to

cost. Entergy, 556 U.S. at 222. Indeed, section 7412

itself elsewhere uses the word “appropriate” in a

manner that clearly does not contemplate

consideration of costs: Paragraph 7412(b)(2) instructs

EPA to make “appropriate” revisions to the list of

hazardous air pollutants, considering health and

environmental effects, but not costs. Congress’s use

of “appropriate” elsewhere in the Act further

demonstrates that costs are not always a relevant

concern. See, e.g., 42 U.S.C. 7513(b)(1) Gnstructing

EPA to reclassify “appropriate areas,” if they “cannot

practicably attain lan air quality standard) by the

attainment date”); id. 7607(b) (suits must be brought

in the “Court of Appeals for the appropriate Circuit”).

This Court has emphasized that broad terms,

including “appropriate,” should not be construed so as

to do override more specific prescriptions in carefully

wrought regulatory statutes. Indeed, this Court

refused to read the phrase “reasonable and

appropriate” to impose an “additional and overriding

requirement of cost-benefit analysis” on a statute

mandating control “to the extent feasible,” because

such a reading would “eviscerate” the statutory

feasibility standard. American Textile Mfrs. Inst.,

Inc. v. Donovan 452 U.S. 490, 513 (1981). See also

American Trucking, 531 U.S. at 468.

Further, Congress directed that EPA “shall”—not

may—regulate, and specified a single

“consideration”"—the health effects revealed by the

study—to inform “appropriateness” (and “necessity”).

That suggests a command to answer a scientific

question, not, as petitioners’ would have it, a grant of

virtually unbounded ‘policy’ discretion not to regulate.

Cf NMA Br. 23 (asserting that statute calls for a

“policy judgment,” not a “scientific” determination).?

The statute confirms that focus on science, by

directing EPA’s attention solely to its “study” of

health hazards—not the “report [on] alternative

control strategies” that subparagraph 7412(n)(1)(A)

instructs EPA to provide to Congress.

The immediately following subparagraph,

7412(n)(1)(B), expressly mentions cost, describing a

separate study directed to Congress covering, inter

alia, available technologies for controlling mercury

emitted from EGUs, as well as the “costs of such

technologies.” Congress did not instruct EPA to

consider that cost-inclusive study before making the

threshold decision under subparagraph (n)(1)(A)—

further evidence that Congress did not require

consideration of costs as a prerequisite to the

threshold listing. See Mississippi ex rel. Hood v. AU

Optronics Corp., 134 S. Ct. 736, 742 (2014) (noting

2 Subparagraph 7412(n)(1)(A) employs language—

“hazards to public health reasonably anticipated to

occur’—Congress has repeatedly employed to describe

“precautionary and preventive” predictive judgments

(emphasis added). See Lead Indus. Ass'n, Inc. v. EPA, 647

F.2d 1130, 1152-55 (D.C. Cir. 1980); Massachusetts v.

EPA, 549 U.S. 497, 506 n.7 (2007). See also 42 U.S.C

7412(b)(2), 7412(b)(3)(B), 7412(b)(3(C), 7412(e)(2)(B).

significance of “disparate inclusion or exclusion” of

“particular language” in the same section of the

statute) (citation omitted); Caraco Pharm. Labs., Ltd.

v. Novo Nordisk A/S, 132 S. Ct. 1670, 1682 (2012)

(adverse inference created when statute used key

term in “the very next subclause, enacted at the very

same time”). The inclusion of costs in a separate

review of mercury-controls technology, and the

longer, four-year deadline for completing that study,

support EPA’s understanding that, for power plants,

costs are relevant to the stringency of emission

standards, under subsection 7412(d)—but not to the

prior decision whether to regulate at all.3

3 NMA contends (Br. 32) that because EPA considered

environmental effects as an alternative basis for its

“appropriate and necessary” finding, the Agency should

also have considered costs, because both are part of the

study required by subparagraph 7412(n)(1)(B). But rather

than simply “borrowling] from Section 7412(n)(1)(B),”

NMA Br. 32, EPA based its inclusion of environmental

effects on the statutory context, noting, inter alia, that

paragraph 7412(c)(9) directs EPA “to consider adverse

environmental effects when delisting source categories,”

strongly implying that such effects are relevant to

threshold listing determinations. 77 Fed. Reg. 9,325. See

also 42 U.S.C. 7412(aX(7) & 7412(b)(2) (requiring listing as

hazardous any pollutant found to have “significant and

widespread adverse effect” on wildlife or other to natural

resources).

B. Section 7412 as a Whole Confirms That EPA’s

Interpretation Is Reasonable.

1. Subsection 7412(b) Reflects Congress’s

Determination That Hazards From Listed

Pollutants Warrant Regulation.

In 1990, Congress chose to list specific

pollutants—including those controlled by the Rule—

because Congress itself concluded that harms from

those pollutants merited regulation under subsection

7412(d)’s stringent standard-setting criteria. 42

U.S.C. 7412(b)(1). Petitioners’ position is that rather

than merely ascertain whether power plants’ toxic

emissions posed the kinds of health hazards (such as,

in the case of mercury, permanent neurological

damage to infants) Congress thought worthy of

regulation, EPA should have undertaken its own

analysis, under the guise of its “appropriate”

determination, of whether regulating those hazards

was good “policy.” NMA Br. 23. See UARG Br. 26.

However, it was at least reasonable for EPA to

conclude that paragraph 7412(n)(1), through the word

“appropriate,” directed EPA not to second-guess

Congress’s judgment that the hazards created by air

toxics are worth regulating—but, rather, merely to

determine that power plants create such significant

hazards (as EPA found they did in 2000, and

reaffirmed in 2011). 77 Fed. Reg. 9,334 (refusing to

interpret subparagraph 7412(n)(1)(A) as “license to

ignore risks that Congress determined warranted

regulation for all other source categories”). Congress,

in 1990, legislated a list of pollutants precisely

because EPA’s efforts to weigh the costs and benefits

of regulating specific hazardous air pollutants had

resulted in paralysis. Leg. Hist. 8,496 (Senate

Report). Congress further recognized that the unique

harms posed by toxie‘air pollution were not easy for

an administrative agency to calculate. /d. at 8,521

(rejecting proposals “urgling] discretion for [EPA] to

weigh a series of factors determining the level at

which acceptable risks might be set”). See also

American Trucking, 531 U.S. at 493 (Breyer, J.,

concurring) (“Congress could have thought such

efforts not worth the delays and uncertainties that

would accompany them”).

Some petitioners assert that subparagraph

7412(n)(1)(A) rested upon a congressional judgment

that hazardous pollutants from power plants “are not

like HAP emissions from other source categories.”

UARG Br. 10. But there is no basis in the statute, the

record, or physical reality, for the notion that

hazardous emissions from power p!ants are somehow

less poisonous, or less worthy of abatement, than

emissions of the same compounds from other large

sources. The administrative record shows that, in

both 2000 and 2011, power plants’ emissions of air

toxics were distinctive, if at all, only because their

volumes vastly exceeded those from other source

categories. Supra, pp. 9-12.

2. Subsection 7412(c)’s Provisions for Listing and

Delisting Source Categories Further Support

the Reasonableness of EPA’s Statutory

Interpretation.

The statutory structure Congress enacted to

define the categories of sources appropriately

regulated under section 7412 is centrally focused on

human health and the environment. Congress

directed EPA to list all categories of sources whose

emissions tonnages exceeded specific thresholds. 42

U.S.C. 7412(c)(1) (requiring EPA to list “all categories

and subcategories of major sources”). It gave EPA

authority to remove source categories from the

subsection 7412(c) list, based solely on criteria of

“adverse health effects” and “adverse environmental

effects.” Jd. 7412(c9)(B). See 77 Fed. Reg. 9,327

(noting that EPA “does not consider costs in any

[section 7412] listing or delisting determinations”).

Subsection 7412(c), like subsection 7412(b),

indicates that Congress meant the decision whether

to regulate sources of hazardous air pollution to turn

on health and environmental harm—not costs. Given

those central concerns, Congress would not have

demanded _ cost-consideration sub_ silentio in

subparagraph 7412(n)(1)(A); the cost “factor is both so

indirectly related to public health and so full of

potential for canceling the conclusions drawn from

direct health effects that it would surely have been

expressly mentioned ... had Congress meant it to be

considered.” American Trucking, 531 U.S. at 469.

That congressional design is further confirmed, as

detailed below, in Congress’s express instructions as

to when, and how, costs should be considered, in

subsection 7412(d).

3. In Subsection 7412(d), Congress Specified

When and How EPA Is to Consider Costs When

Regulating Under Section 7412.

a. Subsection 7412(d) Provides for

Consideration of Costs, Expressly and in a

Particular Manner.

Subsection 7412(d) includes—exactly as

petitioners suggest it should—costs as a consideration

when EPA sets “emissions standards.” UARG Br. 27

(emphasis added). See also Michigan Br. 30-31

(suggesting “common-sense principle” that costs be

considered “when setting standards”). That provision

sets out the specific role for cost Congress deemed

proper in the context of controlling toxics known or

suspected to cause serious, irreversible health harms

to unconsenting members of the public, as well as

extensive environmental damage. An additional,

unbounded inquiry into “appropriate” costs would

flout the constraints Congress placed on EPA’s

consideration of costs during the standard-setting

process “under this section,” 42 U.S.C. 7412(n)(1)(A).

Paragraph 7412(d)(2) sets the over-arching

criteria governing EPA’s standard-setting, which

include “the cost of achieving” emissions reductions.

It does not give EPA unconstrained authority to

weigh costs; rather, it carefully defines the role costs

play. Standards must reflect the “maximum

reduction ... achievable,” through a variety of

“measures, processes, methods, systems, [and]

techniques.” 42 U.S.C. 7412(d)(2). And EPA must

consider not only costs, but also “non-air quality

health and environmental impacts and energy

requirements.” Jd. This accords with how Congress

has addressed costs in other standards across the Act.

Id. 7411(a)(1) “cost” taken into account in identifying

standards reflecting “the degree of emission

limitation achievable through the application of the

best system of emission reduction ... adequately

demonstrated”); id. 7479(3) (standards to reflect the

“maximum degree of reduction of each pollutant ...

achievable” taking into account “costs” as well as

other factors).

Paragraph 7412(d)(3) further places bounds,

drawn from actual experience, on EPA’s discretion,

by requiring that standards for existing sources be no

“less stringent” than the “average emission limitation

achieved by the best performing 12 percent of the

existing sources,” id. 7412(d)(3)(A), of the same

“classll, typel], or sizel],”id. 7412(d)(1). That, too, is

consistent with Congress’s treatment of standard-

setting for severe pollution problems. See id. 7501(3)

& 7503(a)(2) (instructing EPA to base standards on

reductions “achieved in practice,” without any

additional consideration of costs, in areas not

attaining air quality standards).

Subsection 7412(d) thus instructs EPA to address

costs as part of a broader analysis, subject to a clear

standard of “achievable” emissions reductions.

Rather than rendering section 7412 cost-blind, that

treatment of costs suggests that Congress has

carefully and “specifically dealt” with the role of costs

in EPA’s regulatory process, in a manner that EPA

suitably refused to override through the broad,

“general” term ‘appropriate.’ RadLAX Gateway Hote/

v. Amalgamated Bank, 132 S. Ct. 2065, 2071 (2012)

(citation omitted). See id. at 2070 (rejecting

interpretation under which one clause would

“permit[] precisely’ what other, more specific

provision “proscribes”) (citation omitted).

b. Subsection 7412(d)’s Achievement-Based

Criteria Represent § Deliberate

Congressional Choice to Constrain the Role of

Costs.

Petitioners ask this Court to disregard the

presence of costs among subsection 7412(d)’s

standard:setting criteria, because that section

prevents EPA from setting standards “less stringent

than the emissions limitation achieved by the best

performing 12 percent of the existing sources” of the

same type, 42 U.S.C. 7412(d)(3)(A). See Michigan Br.

15-16.

But a limit on Aow EPA utilizes costs does not

transform subsection 7412(d) into one that ignores

costs. To the contrary, it demonstrates that Congress

considered costs, and knowingly instructed EPA as to

how costs should factor into the regulatory process—

within a specific, evidence-based feasibility regime.

See Am. Textile Mfrs. Inst., 452 U.S. at 513 (broad

reading of “appropriate” would defeat statute’s

specific “feasibility” standard). That minimum

stringency requirement represented a deliberate

congressional choice to limit EPA’s “power to

determine that implementation costs should

moderate” air-quality standards, American Trucking,

531 U.S. at 468.

Subsection 7412(d)’s emphasis on reductions

achieved by existing plants of the same type hardly

evidences an irrational or cost-negligent regime. This

very regime governs every other major industrial

source of air toxics, from dry cleaners to petroleum

refineries, 40 C.F.R. 63 Subpts. M, CC. Petitioners’

charge that this regulatory regime is “irrational” is an

attack on the statute itself. Michigan Br. 32. See also

UARG Br. 40.

Congress acted deliberately by embedding cost-

consideration within an overall standard-setting

regime that aims at securing the “maximum degree of

reduction” in toxic pollution that is “achievable.” 42

U.S.C. 7412(d)(2). See Leg. Hist. 8,509 (“Cost

considerations are reflected in the selection of

emissions limitations which have been achieved in

practice,” rather than a “cost-effectiveness or cost-

benefit test”) (Senate Report). Congress’s decision to

deem ‘achievable’ at least the average reductions

being achieved by the best-performing twelve percent

of existing plants—a group comprising nearly one out

of eight currently operating plants—was also

carefully considered. 42 U.S.C. 7412(d)(3). Congress

reasonably concluded that reductions actually

achieved by a significant portion of a source-category

are unlikely to be cost-prohibitive for other plants of

the same “class[],typel], and size[],” id. 7412(d), and

that the better performers should not suffer

competitive harm from investing in controls.

Finally, to the extent subsection 7412(d) raises

any concerns regarding irrational expenditures,

Congress “specifically dealt” with those concerns

within that subsection—precluding petitioners’

efforts to read those concerns into the general

language of subparagraph 7412(n)(1)(A). RadLAX,

132 S. Ct. at 2071. Congress guarded against the

possibility of “expenditures by regulated entities

which secure no public health or environmental

benefit,” Leg. Hist. at 8,511 (Senate Report), and did

so expressly, providing that EPA “may consider [a

health] threshold, with an ample margin of safety,

when establishing emissions standards under this

section.” 42 U.S.C. 7412(d)(4) (emphasis added).

c. Section 7412(d)’s Limitations on EPA’s

Discretion Reflect Congress’s Judgment

Regarding the Severity of the Health Risks

Posed by Air Toxics.

By placing costs within a broader framework that

gives a central role to the reductions achieved in

practice, Congress understood that it was creating a

standard that would be among the Act’s most

stringent. See Leg. Hist. at 8,507 (Senate Report).

That does not reflect disregard of costs; it reflects

Congress’s judgment that a substantial regulatory

burden was “appropriate, as this program is for the

control of extremely harmful air pollutants.” /d.

(emphasis added).

Petitioners may find standards that value public

health so highly to be “silly” or “irrational.” Michigan

Br. 4, 40. But the text, structure, and legislative

history of section 7412 demonstrate that Congress did

not. See, e.g., supra, pp. 16-28; see also Leg. Hist at

3,177 (observing that toxic emissions result in “an

exceptionally high level[] of risk,” and that “EPA’s

goal is to protect the greatest number of people

possible” from such risks); jd. at 3,178 (noting that air

toxics cause “serious” harm, including “birth defects,

damage to the brain or other parts of the nervous

system, reproductive disorders, and _ genetic

mutations”) (House Report).

In judging “appropriateness,” EPA correctly hewed

to the balance struck by Congress between the harms

of air toxics and the regulatory burdens of redressing

those harms. Far from being blind to costs, the

standard-setting process under subsection 7412‘d)

reflects a carefully crafted congressional judgment #s

to harms of air toxics, and the costs that should be

incurred to remedy them.

It was at least reasonable for EPA to interpret the

words “appropriate and necessary” in subparagraph

7412(n)(1)(A) congruently with, rather than in

opposition to, the above-described constraints 6n

EPA’s discretion. Subparagraph 7412(n)(1)(A)

indicates that power plants are to be regulated “under

this section,” demonstrating that Congress

understood that the section 7412 framework—

including the time and manner of cost-consideration

specified by subsection 7412(d)—would govern power

plants if EPA determined regulation is appropriate

and necessary.

4. EPA’s Interpretation is Consistent With

Subsection 74120.

Contrary to some petitioners’ contention (UARG

Br. 30-31), subsection 7412(f) does not suggest that

Congress meant, by use of the word “appropriate” in

42 U.S.C. 7412(n)(1)(A), to demand that EPA address

costs within its threshold listing for power plants.

First, subsection 7412(f)’s residual risk

requirements by their terms apply only to sources

that already are subject to subsection 7412(d)

standards; they do not support bypassing the

structured cost-consideration provided by subsection

7412(d). See 42 U.S.C. 7412(f)(2)(A), 7412(m)(6).

Congress could readily have instructed EPA, in

subparagraph 7412(n)(1)(A), to forego section

7412(d)’s technology-based standards in favor of a

residual risk analysis similar to that required by 42

U.S.C. 7412(. Instead it pointedly instructed EPA to

regulate power plants “under this section,” 42 U.S.C.

7412(n)(1)(A)—ie, the entirety of section 7412—

rather than under subsection (f).

Second, the residual risk standards further

demonstrate Congress’s decision to give public health

considerations primacy over cost concerns.

Subparagraph 7412(f)(2)(A) allows EPA to consider

costs, only in determining whether to set standards

more stringent than those “necessary” to “provide an

ample margin of safety to protect public health.”* See

Leg. Hist. at 8,518 (EPA is to address “questions of

cost and feasibility only after a protective health and

environmental standard has been defined”) (Senate

Report). Congress imposed that public-health

standard specifically to avoid empowering EPA to

“balancle] ... the adverse health effects ... against the

costs that would be imposed,” in recognition of EPA’s

4‘ NRDC v. EPA, 824 F.2d 1146, 1163 (D.C. Cir. 1987)

(en banc) (cited in Michigan Br. 28-29), addressed the pre-

1990 provision similarly requiring EPA to regulate air

toxics with an “ample margin of safety to protect the public

health,” 42 U.S.C. 7412(b)(1)(B) (1982). The court held

that, under that provision, EPA “cannot under any

circumstances consider cost and technological feasibility

... [during] the preliminary determination of what is safe,”

824 F.2d at 1165, and recognized that, even in setting

standards beyond that health-based standard, EPA could

adopt an approach in which costs would not be considered,

id. at 1165-66 & n.11. If relevant here, NRDC thus

supports EPA’s decision not to base its threshold listing

decision on costs.

demonstrated inability to effectively accomplish such

balancing. /d. at 8,517-8.

C. The Clean Air Act as a Whole Confirms That

EPA’s Interpretation is Reasonable.

Subparagraph 7412(n)(1)(A)’s treatment of costs,

as understood by EPA, is congruent with Congress’s

treatment of costs elsewhere in the Clean Air Act.

When the Act calls upon EPA to decide whether to

regulate either a particular pollutant, or particular

sources of pollution, it invariably directs the Agency’s

attention to public health and welfare—not costs.

Rather, the Act uniformly introduces costs as a

consideration only during the standard-setting

process, when EPA decides show stringently

to regulate.

The Act does not, for example, make costs a

permissible—let alone mandatory—consideration

when EPA decides whether to regulate a given

pollutant. See, eg, 42 U.S.C. 7408(a)(1)(A) (air

quality criteria, based on danger to public health or

welfare); id. 7545(c) (fuel additives: “endanger[ment)”

standards). Likewise, the Act does not instruct EPA

to consider costs when it decides whether to regulate

particular sources of pollution. Rather, it provides

that sources are to be regulated based upon the harms

they pose to public health and the environment. See,

e.g., id. 7411(b)(1)(A) (requiring EPA to regulate any

source category causing “air pollution which may

reasonably be anticipated to endanger public health

or welfare”); id. 7475(a) & 7479(1) (requiring EPA to

regulate all sources emitting more than specified

quantities of pollutants); id. 7503(a) (subjecting

sources to non-attainment permitting program

without consideration of cost); id. 7521 (threshold

decision to regulate motor vehicles based on “public

health or welfare,” not costs); jd. 7571 (threshold

decision to regulate aircraft engines depends upon

“public health and welfare,” not costs).

Where the Act directs EPA to consider costs, it

does so with respect to the standard-setting process,

when the Agency decides Aow stringently to regulate

pollution sources. Eg, 42 US.C. 7411(a)(1)

(including “cost of achieving such reduction” as part

of standard-setting for new stationary sources);

7479(3) (including “economic impacts and other costs”

as part of standard-setting under Prevention of

Significant Deterioration regime). And even when

setting source-specific standards, the Act does not

free EPA to decide what costs might be “appropriate”;

rather, it imposes feasibility or other constraints to

guide EPA’s decision-making. See, e.g., 7411(a)(1)

(standards to reflect “best system of emission

reduction ... adequately demonstrated”); 7479(3)

(standards to reflect the “maximum degree of

reduction of each pollutant ... achievable”).®

When UARG asserts (Br. 27) that “every provision

of the act that authorizes EPA to address the

establishing of emissions standards for specific

sources includes costs as a _ standard-setting

consideration,” it conflates two different decisions: (a)

5 EPA’s understanding of the Act’s “good neighbor”

provision, upheld in EPA v. EME Homer City Generation

Co., 134 S. Ct. 1584 (2014), is consistent with this Act-wide

pattern. In Homer City EPA considered costs in

“allocatling]) among multiple contributing upwind States,”

so as to more efficiently meet (not to weaken) health-based

air quality standards, id. at 1604, 1606-7.

threshold decisions about whether to subject “specific

sources” to regulation, analogous to subparagraph

7412(n)(1)(A); and (b) standard-setting decisions to

establish emissions limitations applicable to those

sources, such as decisions under subsection 7412(d)

(which does include costs).

EPA’s interpretation of subparagraph

7412(n)(1)(A), as designating a threshold decision in

which costs are not a proper factor, is congruent with

the whole Clean Air Act. Petitioners’ interpretation

would, in contrast, result in an aberrant regime,

requiring EPA to assess costs at a stage at which the

Act uniformly excludes costs from consideration, and

according to a standard found nowhere in the Act

(nor, for that matter, anywhere in petitioners’ briefs).

Ul. EPA Has Given Full Effect to Subparagraph

7412(a)(1)(A).

Petitioners complain that EPA’s reading of

subparagraph 7412(n)(1)(A) fails to respect “the

fundamental differences in the respective regulatory

regimes” governing power plants and other sources,

NMA Br. 35, and that, if Congress had regarded the

identification of health hazards as sufficient to

warrant regulation, “there would have been no need”

to enact subparagraph 7412(n)(1)(A), Michigan Br.

39. These arguments are meritless.

Subparagraph 7412(n)(1)(A) embodied a

compromise. Some legislators were moved by

industry arguments that power plants’ emissions of

hazardous air pollution either did not pose health

problems, Leg. Hist. 872 (“(Industry] argued that

mercury isn’t much of an environmental problem.”)

(Sen. Durenberger); id. at 779 (regulating power

plants’ mercury emissions “could not be sustained by

the scientific facts”) (Sen. Burdick); id. 1,416 (“health

risks from emissions of hazardous air pollutants from

powerplants is vanishingly small”) (Rep. Oxley); or

that any such dangers might be eliminated as an

incidental benefit of other pollution control programs,

especially the new Title IV Acid Rain Program, id. at

1,415-16 (Rep. Oxley). See 77 Fed. Reg. 9,321-22; 76

Fed. Reg. 24,978. Others insisted that the harms

from power plant emissions warranted mandatory

and expeditious control. £.g., Leg. Hist. at 871-872

(Sen. Durenberger). See 77 Fed. Reg. 9,322.

The text of subparagraph 7412(n)(1)(A) reflects

that compromise. EPA -vas to study the “hazards to

public health reasonably anticipated to occur as a

result of emissions by [power plants]” of hazardous air

pollutants “after imposition of the requirements of

this chapter.” But after considering the results of this

study, EPA was compelled to regulate power plants

under section 7412, if the Administrator “flound]”

such regulation “appropriate and necessary.” Jd. See

also 77 Fed. Reg. 9,335. Notably, even opponents of

immediate regulation understood that EPA’s decision

would be based on “the scientificevidence.” Leg. Hist.

at 1,416 (Rep. Oxley) (emphasis added). See also id.

at 8,820 (The President's proposal “wisely

incorporated a thorough scientific review of the

possible health benefit from the utility powerplant

regulation for air toxics prior to the imposition of any

regulations.”) (Sen. Symms).®

6 Judge Kavanaugh’s dissent relied heavily upon

Representative Oxley’s reference to subparagraph

7412(n)(1)(A) as intended to provide “protection of the

public health while avoiding excessive and unnecessary

EPA followed the path Congress laid out in

subparagraph 7412(n)(1)(A). EPA determined

whether power plants’ hazardous emissions harm

public health after (and despite) the pollution

reductions required under other provisions of the Act.

76 Fed. Reg. 24,990-92. EPA’s interpretation of

subparagraph 7412(n)(1)(A) afforded power plants a

special, industry-specific threshold examination,

provided to no other source category, as to: (1)

whether emissions from this particular source

category posed a public health hazard, id. at 24,999-

25,017, and (2) whether other programs would

adequately abate that hazard, jd. at 25,017. The

multiple peer-reviewed studies in the _ record

painstakingly connecting power plants’ emissions to

particular health harms testify to the singular status

accorded power plants by EPA’s reading of

subparagraph 7412(n)(1)(A). See id. at 24,999-25,017.

But after exhaustive study, EPA found that

significant hazards to public health do remain. See

supra, pp. 7-13. Indeed, in 2000, EPA estimated that

power plants’ emissions of mercury and many other

hazardous air pollutants would be Aigher in 2010

costs.” Pet. App. 81a (citing Leg. Hist. 1,417). But even

that statement of a sole legislator (see 77 Fed. Reg. 9,322)

is consistent with understanding subparagraph

7412(n)(1)(A) as providing a regulatory reprieve while EPA

conducted a scientific review of projected emissions levels

and their health effects, without altering the ways costs

are treated under section 7412. Indeed, in the same

passage, Rep. Oxley characterized subparagraph

7412(n)(1)(A) as predicating regulation on whether EPA

found a “significant risk of serious adverse effects on public

health.” Leg. Hist. 1,416-17.

than in 1990. 65 Fed. Reg. 79,829 tbl. 1. EPA

estimated that mercury emissions would increase

from 46 to 60 tons per year, and that arsenic,

chromium and hydrogen chloride emissions would

also increase. /d. The Agency found that power

plants were “the largest source of mercury emissions

in the U.S.,” and that their mercury emissions “are a

threat to public health and the environment.” Jd. at

79,827. See also 76 Fed. Reg. 24,994.

EPA also found that neither the Acid Rain

Program nor other statutcry requirements had

sufficed to abate those hazards. FE.g., 65 Fed. Reg.

79,827; JA106-07. Some suggested, in 1990, that

controls for sulfur dioxide and nitrogen oxides might

reduce emissions of some air toxics. See 76 Fed. Reg.

24,990. But as events unfolded, the dominant Title

IV compliance strategy for many coal-burning

facilities was switching to low-sulfur coal or

purchasing emissions allowances, rather than

installing such controls. See JA 117-18 (Utility

Study’s finding that 80 percent of units surveyed had

complied with Acid Rain Program by switching to

lower-sulfur coal (53%) or purchasing additional

allowances (27%)); David Spence, Coal-Fired Power in

a Restructured Electricity Market, 15 Duke Envtl. L.

& Pol'y F. 187, 197 (2005). And what controls were

installed proved ineffective to reduce mercury and

other hazardous pollutants, JA 106-7. Furthermore,

in the decades after subparagraph 7412(n)(1)(A)’s

enactment, a more robust scientific understanding

developed demonstrating that toxic emissions from

power plants pose serious health harms. 76 Fed. Reg.

24,999-25,016.

Had EPA concluded that power plants’ emissions

were not ‘reasonably anticipated” to present “hazards

to public health” following imposition of other

statutory requirements—a possibility contemplated

by some legislators in 1990—the Agency would have

determined that regulating power plants under

section 7412 was not “appropriate and necessary.”

(As noted, EPA did so conclude as to gas-fired units,

supra,n.1). EPA in fact carried out, and heeded the

results of, the special, source category-specific fact-

finding exercises that the provision requires. That

the results of EPA’s extensive inquiries pointed in

favor of regulating power plants does not mean that

EPA failed to give plant-owners the full benefit of the

legislative compromise that subparagraph

7412(n)(1)(A) represents.

Michigan’s complaint that EPA read the statute to

require regulation “no matter how slight the hazard,”

Michigan Br. 13, is not remotely accurate. In

exercising its judgment under _— subsection

7412(n)(1)(A) EPA considered: “the nature and

severity of the health effects associated with

exposure”; “the degree of confidence in our knowledge

of those health effects”; “the size and characteristics

of the populations affected by exposures”; “the

magnitude and breadth of the exposures”; and how

exposures to emissions from a “particular source

category ... contribute to risk in populations with

additional exposures ... from other sources.” 76 Fed.

Reg. 24,992. See also 77 Fed. Reg. 9,334-36

(summarizing EPA’s detailed analysis of harms from

power plant emissions).

After an exhaustive review of the science, EPA

affirmed that it had identified substantta/ risks to the

public. 77 Fed. Reg. 9,323. Cf American Trucking,

531 U.S. at 495-96 (Breyer, J., concurring). Based

upon this extensive evidence on health effects, as well

the enormous “magnitude” of toxic emissions from

coal- and oil-fired power plants, 77 Fed. Reg. 9,363,

EPA determined that those emissions “pose a hazard

to public health,” sd. at 9,366, and that this hazard is

“serious,” id. at 9,304, 9,310-11.

IIT. EPA’s Interpretation Does Not Lead to

Unreasonable or Absurd Results.

A. EPA’s Interpretation Does Not Permit Absurd

Results.

Petitioners are notably reticent about how EPA

Should have performed the unique, novel, and

statutorily unguided analysis of costs they claim was

required; rather, their briefs are largely directed at a

hypothetical pollution rule with little or no public

benefits, but exorbitant costs. Petitioners

hypothesize that EPA might, under its interpretation

of the statute, impose regulations “if the costs were

$9.6 billion per year and the benefits were only $1.”

Michigan Br. 47. But EPA’s interpretation leads to

no such absurdly unbalanced results.

First, such results are precluded by EPA’s

interpretation of subparagraph 7412(n)(1)(A), as

triggering regulation only when the Agency finds a

public health ‘hazard’-—a term EPA understood to

demand inquiry into “severity” and “magnitude.” 76

Fed. Reg. 24,992. EPA’s threshold inquiry found

substantial public health harms, including “about

580,000 women” of child-bearing age with blood

mercury levels sufficient to endanger a developing

fetus. 76 Fed. Reg. 24,995. See id. at 25,007-11

(finding that power plants were substantial

contributors to these levels). Congress saw no

absurdity in regulating based upon such harms. Leg.

Hist. 3,178 (noting need for action against toxics

damaging “the brain or other parts of the nervous

system”). See also 42 U.S.C. 7412(a)(1), (c)(9).

Second, EPA applied the normal subsection

7412(d) standard-setting criteria to power plants,

criteria Congress crafted to avoid “wildly out of

balance” outcomes, UARG Br. 42. Petitioners’

hypothetical assumes the unlikely scenario that 12

percent or more of sources are already achieving

emissions reductions that would be cost-prohibitive

for other units of the same class, type, and size to

achieve. See 42 U.S.C. 7412(d)(3). Petitioners fail to

show that this standard-setting regime, which has

now been applied across the length and breadth of the

industrial economy—from steel mills to lead smelters,

refineries to rubber plants, chemical factories to

industrial boilers—has, in fact, resulted in irrational

or wildly unbalanced costs. See 77 Fed. Reg. 9,335

(noting that EPA has promulgated standards for more

than 170 source categories under section 7412).

B. The Rule Is Not Evidence of an Unreasonable

Interpretation.

The only concrete example petitioners offer is their

oft-repeated assertion that the Air Toxics Rule itself

creates benefits totaling a mere “$4-$6 million,” while

imposing costs of “$9.6 billion annually.” UARG Br.

42. That is a gross mischaracterization of the Rule’s

consequences. The record squarely indicates that the

Rule produces massive reductions in air toxics,

providing correspondingly large health benefits. See

supra, pp. 9-13.

Petitioners perform two sleights of hand in trying

to make those enormous public health benefits

disappear. First, although EPA found in its

Regulatory Impact Analysis that the subset of

pollution-control benefits to which it could affix a

dollar figure were worth between $33 and 90 billion—

dwarfing the expense of compliance, 77 Fed. Reg.

9,432 tbl. 10—petitioners dismiss most of these

benefits as “irrelevant” on the basis that they are “co-

benefits,” ie., benefits not directly tied to hazardous

air pollutants (such as some benefits of reducing toxic-

metal-bearing particulates), Michigan Br. 47-48. But

taking account of co-benefits is the standard and

sensible practice in cost-benefit analysis. E.g., Office

of Management and Budget, Circular A-4 26 (2003).

Petitioners fail to show why “common-sense”

(Michigan Br. 30) would ignore real-world benefits

like avoiding thousands of premature deaths and

hundreds of thousands of sick days. See 77 Fed. Reg.

9,429 tbl. 9.

Equally baseless is petitioners’ effort to dismiss all

public health benefits to which EPA could not assign

monetary value. Claims that the Rule yields only

“minimal” public health benefits (Michigan Br. 46)

depend upon treating the extremely limited extent to

which EPA could monetize benefits from mercury

reductions as the Rule’s sole cognizable value, and

assigning no value at al/ to vast reductions in overall

national emissions of numerous other toxics that

Congress enacted Section 7412 to abate. See supra,

pp. 9-13.

The “mere $4-$6 million per year” (NMA Br. 1)

was, again, part of EPA’s Regulatory Impact Analysis

under Executive Branch guidance, and, as EPA

explained, reflects only a single narrow dimension of

the harms caused by just one of the pollutants

(mercury)—the “foregone future earnings” for

someone who suffers a reduction in intelligence

quotient (IQ) from mercury poisoning as a child. D.C.

Cir. JA 2346. EPA, however, explained that this

estimate greatly underrepresented mercury’s true

harms. 77 Fed. Reg. 9,313, 9,353 (noting that IQ loss

fails to capture all effects of mercury poisoning). See

also JA 813 (Science Advisory Board’s observation

that IQ loss is an “insensitive indicator of

methylmercury neurobehavioral impacts,” one that

“could underestimate risk”).

And even as to IQ loss, the monetized benefits did

not remotely purport to describe the full harm. An

estimate of lost income ($893 to $11,859 per IQ point,

D.C. Cir. JA 2347-48) does not capture the

consequences of permanent, lifelong intelligence loss

damage starting in early childhood or in utero—just

one example of the sort of profound methodological

limitations that led Congress to relieve EPA of the

responsibility of a threshold weighing of costs against

benefits. See supra, pp. 4, 16-29; see also, e.g. JA

951-52 (discussing “methodology and _ data

limitations” that led EPA to employ “qualitative

analysis” rather than “monetization of reductions in

cancer incidences”).

EPA explained that benefits to the public from

reductions in hazardous air pollutants “could be

substantial,” JA 914, though EPA could not assign

most of them a monetary value. Nothing in the Act

requires EPA to perform the often impossible task of

“monetizing the public benefits from reducing

hazardous air pollutants. EPA’s extensive and

detailed qualitative assessment of the harms

resulting from power plants’ toxic emissions, e.g., 76

Fed. Reg. 24,988-25,020—especially combined with

its identification of “successfully demonstrated”

technologies to reduce that harm, id. at 25,014—

reasonably ensured that the regulatory process would

serve the ends identified by Congress. See Entergy,

556 U.S. at 235 (Breyer, concurring) (agency may

“describe environmental benefits in non-monetized

terms” and thereby “avoid lengthy formal cost-benefit

proceedings and futile attempts at comprehensive

monetization”).7

The public health gains this rule will achieve—

and in particular those from its dramatic reduction in

overall national emissions of pollutants such as

mercury, chromium, cadmium, nickel and

hydrochloric acid gas—place it among the most

important air pollution regulations this country has

adopted. A “reasonable person” (Michigan Br. 47)

would choose to spend significant sums to achieve,

large, otherwise unattainable reductions in emissions

of a variety of dangerous, congressionally-designated

contaminants, as the Air Toxics Rule does. And the

7 The Court did not grant certiorari on whether EPA

should have exempted acid gases like hydro-

chloric acid and hydrogen cyanide, see NMA Br.

42-44. In any event, that contention lacks merit.

Subparagraph 7412(n)(1)(A) specifies that regulation

proceed “under this section,” and paragraphs 7412(d)(1) &

(2) require that EPA set emissions standards for each

listed hazardous pollutant. See Sierra Club v. EPA, 479

F.3d 875, 883 (D.C. Cir. 2007). Contrary to petitioner's

suggestion, acid gases pose acute and chronic threats to

public health. See 76 Fed Reg. 25,050-51.

1990 Congress made that choice, mandating

regulation of sources spanning the whole economy

without requiring any prior tally of “monetized

benefits,” or any threshold assessment of compliance

costs.

The most reasonable reading of subparagraph

7412(n)(1)(A)—certainly a permissible one under

Chevron U.S.A. Inc. v. Natural Resources Defense

Council, Inc., 467 U.S. 837 (1984) —is that Congress

wanted the Administrator to decide, based on careful

review of the evidence, whether power plant

emissions pose a hazard to the public, and, if so, to

regulate them “under [section 7412],” with its

carefully crafted provisions for securing “achievable”

reductions in light of costs and existing industry

practice.

CONCLUSION

The judgment of the court of appeals should be

affirmed.

Respectfully submitted.

Sanjay Narayan

Sierra Club

85 Second St., 2™ Floor

San Francisco, CA 94105

Counsel for Sierra Club

James S. Pew

Neil E. Gormley

Earthjustice

1625 Massachusetts Ave.,

NW, Suite 702

Washington, D.C. 20036

Counsel for Chesapeake

Bay Foundation, Clean

Air Council, National

Association for the

Advancement of Colored

People, Sierra Club, and

Waterkeeper Alliance

Sean H. Donahue

Counsel of Record

David T. Goldberg

Donahue & Goldberg, LLP

1130 Connecticut Ave., NW

Suite 950

Washington, D.C. 20036

(202) 277-7085

sean@donahuegoldberg.com

Vickie L. Patton

Graham McCahan

Tomas Carbonell

Environmental Defense

Fund

2060 Broadway

Boulder, CO 80302

(303) 447-7216

Counsel for Environmental!

Defense Fund

John Suttles

Southern Environmental

Law Center

601 W. Rosemary St.

Suite 220

Chapel Hill, NC 27516

(919) 967-1450

jsuttles@selc.org

Counsel for American

Academy of Pediatrics,

American Lung

Association, American

Nurses Association,

American Public Health

Association, and

Physicians for Social

Responsibility

February 25, 2015

Ann Brewster Weeks

Darin T. Schroeder

Clean Air Task Force

18 Tremont St., Ste. 530

Boston, MA 02108

Counsel for Citizens for

Pennsylvania's Future,

Conservation Law

Foundation, Environment

America, Izaak Walton

League of America, Natura!

Resources Council of Maine,

and Ohio Environmental

Council

John D. Waike

Natural Resources

Defense Council

1152 15% St. NW

Suite 300

Washington, D.C. 20005

Counsel for Natural

Resource Defense Council

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