Petition for Writ of Certiorari — Nat'l Mining Ass'n v. Envtl. Prot. Agency, 135 S. Ct. 703 (2014) (No. 14-49)
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14-49
No. 14-___
at. S-
IN THE
Supreme Court of the United States
NATIONAL MINING ASSOCIATION, PETITIONER
Vv.
ENVIRONMENTAL PROTECTION AGENCY, RESPONDENT
ON PETITION FOR WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS FOR THE DISTRICT
OF COLUMBIA CIRCUIT
PETITION FOR A WRIT OF CERTIORARI
VOLUME 1 of 4
Caknoi. W. McGurrey III PETER S. GLASER
SUSTIN WONG (Counsel of Record)
TRoutTMan SANDERS LLP TROUTMAN SANDERS LLP
$00 PEACHTREE STREET, NE 401 NINTH STREET N.W.
Surrs 5200 SUITE 1000
ATLANTA, GA 30308-2216 WASHINGTON, D.C. 20004
202-274-2998
Peter.glaser
@troutmansanders.com
duly 34, 2014 Counsel of Petitioner
Belew eres Prerec Co. ne ~ (202) 789-0096 — WasHinGTON, D C. 20002
QUESTION PRESENTED
Whether an administrative agency, when
authorized by Congress to regulate only if
“appropriate,” can deem the cost of the regulation
irrelevant, with the result that, by the agency's own
estimate, regulatory costs outweigh benefits by
almost two thousand to one.
‘i
PARTIES TO THE PROCEEDING
The following were parties to the proceedings
in the U.S. Court of Appeals for the District of
Columbia Circuit:
The National Mining Association, the
petitioner on review, was a petitioner and a
respondent-intervenor below.
The respondent herein, which was the
respondent below, is the United States
Environmental! Protection Agency.
Additional petitioners below were White
Stallion Energy Center, LLC; American Public Power
Association; ARIPPA; Chase Power Development,
LLC; Edgecombe Genco, LLC; FirstEnergy
Generation Corporation; Gulf Coast Lignite Coalition;
Institute for Liberty; Julander Energy Company;
Kansas City Board of Public Utilities; Midwest Ozone
Group; National Black Chamber of Commerce; the
Utility Air Regulatory Group; Oak Grove
Management Company, LLC; Peabody Energy
Corporation; Puerto Rico Electric Power Authority;
Spruance Genco, LLC; State of Alabama; State of
Alaska; State of Arizona; State of Arkansas, ex rel.
Dustin McDaniel, Attorney General; State of Florida;
State of Idaho; State of Indiana; State of Kansas;
State of Michigan; State of Mississippi; State of
Missouri; State of Nebraska; State of North Dakota;
State of Ohio; State of Oklahoma; Commonwealth of
Pennsylvania; State of South Carolina; State of
Texas; Texas Commission on Environmental Quality;
Texas Public Utility Commission; Railroad
Commission of Texas; State of Utah; Commonwealth
ill
of Virginia; State of West Virginia; State of Wyoming;
Terry E. Branstad, Governor of the State of Iowa on
behalf of the People of Iowa; Jack Conway, Attorney
General of Kentucky; Tri-State Generation and
Transmission Association, Inc.; United Mine Workers
of America; West Virginia Chamber of Commerce,
Inc.; Georgia Association of Manufacturers, Inc.:
Indiana Chamber of Commerce, Inc.; Indiana Coa]
Council, Inc.; Kentucky Chamber of Commerce, Inc.;
Kentucky Coal Association, Inc.; North Carolina
Chamber; Ohio Chamber of Commerce; Pennsylvania
Coal Association; South Carolina Chamber of
Commerce; The Virginia Chamber of Commerce; The
Virginia Coal Association, Incorporated; West
Virginia Coal Association, Inc.; Wisconsin Industria]
Energy Group, Inc.; Wolverine Power Supply
Cooperative, Inc.; Chesapeake Climate Action
Network; Conservation Law Foundation;
Environmental Integrity Project; and Sierra Club.
Respondent-intervenors below (with respect to
certain petitions for review) were Commonwealth of
Massachusetts; State of California; State of
Connecticut; State of Delaware; State of Illinois;
State of Iowa; State of Maine; State of Maryland;
State of Minnesota; State of New Hampshire; State of
New Mexico; State of New York; State of North
Carolina; State of Oregon; State of Rhode Island:
State of Vermont; City of Baltimore; City of Chicago;
City of New York; District of Columbia; County of
Erie, New York; Calpine Corporation; Chase Power
Development, LLC; Exelon Corporation; National
Grid Generation LLC; Public Service Enterprise
Group, Inc.; Gulf Coast Lignite Coalition; Institute
for Liberty; Lignite Energy Council; National Black
Chamber of Commerce; National Mining Association:
lV
Oak Grove Management Company, LLC; Peabody
Energy Corporation; Sunflower Electric Power
Corporation; Tri-State Generation and Transmission
Association, Inc.; Utility Air Regulatory Group; White
Stallion Energy Center, LLC; 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.
A respondent below (with respect to certain
petitions for review) was Lisa Perez Jackson,
Administrator, United States Environmental
Protection Agency. Ms. Jackson ceased to hold the
office of Administrator, United States Environmental!
Protection Agency, on February 15, 2013; that office
is currently held by Gina McCarthy, Administrator,
United States Environmental Protection Agency.
Vv
RULE 29.6 DISCLOSURE STATEMENT
The National Mining Association is a non-
profit, incorporated national trade association whose
members include the producers of most of America’s
coal, metals, and industrial and _ agricultural
minerals; manufacturers of mining and mineral
processing machinery, equipment, and supplies; and
engineering and consulting firms that serve the
mining industry. NMA has no parent companies,
subsidiaries, or affiliates that have issued shares or
debt securities to the public, although NMA’s
individual members have done so.
vi
TABLE OF CONTENTS
Page
RNS BIE TIED cinivacevninicteovncecncescessucestanbiene i
PARTIES TO THE PROCEEDING............................ il
RULE 29.6 DISCLOSURE STATEMENT ................. Vv
og, REI SS EE ere RO vi
pe Pde ose, 5 yy: eee viii
PETITION FOR A WRIT OF CERTIORARI ............. 1
TERRES IIA IIIA RE ANOLE © PH PEOMEE DNS 1
(kIT HG Ds ioncist ae Me Seen asa APR RES 1
STATUTORY AND REGULATORY
RRR SOs STAI Aer en ts LPs l
REET Sa AIRED A are eae Semen ea Ro PA 1
ij 75) os @ i ge 8 SESE emienes 7
REASONS FOR GRANTING THE PETITION ....... 15
I. EPA UNREASONABLY FAILED TO
+ RE eT ata eset penne eras a 16
II. EPA’S REGULATION OF ACID GASES
DEMONSTRATES THE
IRRATIONALITY OF EPA’S
Re REDE Se i Nts PBS! REUSE SS Rye 22
RST ESE ESAS PEO SO RR AP Ne 29
APPENDIX A: In the United States Court of
Appeals for the District of Columbia
Circuit — Opinion (Apr. 15, 2014) ................. la
APPENDIX B: In the United States Court of
Appeals for the District of Columbia
Circuit — Judgment (Apr. 15, 2014) ............ 99a
TABLE NTENTS
(continued)
Page
APPENDIX C: 42 U.S.C.S. § 7422..................00000 10la
APPENDIX D: National Emission Standards
for Hazardous Air Pollutants From Coal}-
and Oil-Fired Electric Utility Steam
Generating Units and Standards of
Performance for Fossil-Fuel-Fired
Electric Utility, Industrial-Commercial-
Institutional, and Small Industrial-
Commercial-Institutional Steam
Generating Units, 77 Fed. Reg. 9,305
I, SIE au cencieu peeetdetetaiplatcriaerscgiemamaneean aude 196a
APPENDIX E: National Emission Standards
for Hazardous Air Pollutants From Coal-
and Oil-Fired Electric Utility Steam
Generating Units and Standards of
Performance for Fossil-Fuel-Fired
Electric Utility, Industrial-Commercial-
Institutional, and Small Industrial-
Commercial-Institutional Steam
Generating Units, Proposed Rule 76
Fed. Reg. 24,976 (May 3, 2011)................ 116la
APPENDIX F: Study of Hazardous Air
Pollutant Emissions from Electric
Utility Steam Generating Units
SE icatetisnincebniiktuadcbsentuvinnetiianiaseupied 1937a
Page(s)
CASES
Ali v. Federal Bureau of Prisons,
ee CE eoiincccncntncivcvcerseasweeneneans 19, 27
Am. Tobacco Co. v. Patterson,
IIE ea icancruniesnciubnasiisetaesatuabapanaiens 22
Central Bank of Denver v. First Interstate Bank,
ee ee ee EE icsiidicrenccesenssanssentonadatdentaceenn 21
Chevron, U.S.A., Inc. v. Natural Resources Defense
Council, Inc.,
a ee IE Secistntednkencontadieinssreninitcapnees 4,5
Christopher v. SmithKline Beecham Corp.,
Se le i Fe IID rectectectccenenescstndessccereseseans 17
Coal. For Responsible Regulation v. EPA,
684 F.3d 102 (D.C. Cir. 2012) .................0000000.. 28
Entergy Corp. v. Riverkeeper, Inc.,
ST MIE onc: cohecsaskeeraccucsavedaunenesntonaanas 6
FDA v. Brown & Williamson Tobacco Corp.,
Es ID sited daicerstececveesnstassinesess 18, 22
FDIC v. Meyer,
ey ee ee Ce deresitrteccercheitcccinds dis cttadenicien 17
Harrison v. PPG Industries, Inc.,
ks Ot ED eithikeiiv a seiecndcensaccdinasasccvcasersedecs 17
Hibbs v. Winn,
542 U.S. 88 (2004)
Massachusetts v. EPA,
WEED, GOT II anche sda ee cence hcecees 16
Massachusetts v. United States DOT,
93 F.3d 890 (D.C. Cir. 1996)
ix
TABLE OF AUTHORITIES
(Continued)
Page(s)
MCI Telcoms. Corp. v. AT&T,
ey MI sais ci ccdecccscdecicasedeudoctmnasioisienn 17
Michigan v. EPA,
sr ae Tf fii tee Se eee 18
Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto.
Ins. Co.,
ee i I gs sacha aacecsavicccnctoeiioneCoasacees 5, 25
Nat? Lime Ass’n v. EPA,
233 F.3d 626 (D.C. Cir. 2000) ............000222.. 24, 25
Nat? Envtl. Dev. Ass’n Clean Air Project v. EPA,
— 9 eT. Gites > . SRE 24
Nat’ Ass’n of Mfrs. v. EPA,
BE re ee ie te PD anbaSedivcseccedcccvenentcs 4
New Jersey v. EPA,
617 F.346 674 (D.C. Cir. 2006) .....0...00cc0000.2.-. 7,10
Norwest Bank Minn. Natl Ass'n v. FDIC,
ED Fe re Cs I, BD sided ccisedcdecinccnnss 27
Utility Air Regulatory Grp.,
a esate: 6, 15, 16
White Stallion Energy Center v. EPA, 748 F.3d
OR: WII: PNUD sidctiicccenciscnndecneionianse passim
Whitman v. Am. Trucking Ass'n,
Oe I Ne CN ii acacsdccaseeaeitachinioal 6, 18
STATUTES
Be I, Oe iii occa aaidecsheeiisetnnecnbaabesiclmnsaloaiiios l
ee a Oe IE eta iielichhicsccenistuiubibentlandy acces Soatalbians 18
ee on aes 24
x
TABLE OF AUTHORITIES
(Continued)
Page(s)
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ON gdh ag aslo RRR AI A cabaret Lelnnsreitarm Renae ane 7, 20
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Oe ee idiadtimadvesinins 20
Se ees Oe FIED ei deccnevesskanesendsartcncsneusnnes passim
ee Ss ee ee HI sodnkicascbiccevensescizalncwcctinansnain 8, 25
FEDERAL REGISTER NOTICES:
65 Fed. Reg. 79,825 (Dec. 20, 2000).................cesccesecsees 9
7. & F&F ay * ep near ermmrerennerrre 9
OP Bree, Tie, GD Ge BB vcs cssnccccsccessccsccssicccess 9
70 Fed. Reg. 15,994 (Mar. 29, 2005)....................... 8, 10
ee rs Ce Fe i aeranescsnenadcctenistcassisetaanses 9
Fe ie IS Gictineissisinecinakageimeaatababeialides 10
BP athntianccnsinsinissbinnacevnetonmmennibuiike 10
Se Oe NS ieruntaniccnmiedauenaieensneceniniade 10
ee ee I i eT iiiceiadnesceinticincesetabneianicteondins 10, 23
Be PU, BE, BE re I Gy ORI) vsvcssvestncecnscivedeseavccess 3
Fe ee le i scciecicastidekicsboniencecbectiereerneetnil 17
Be i Oe EG oiiieniceccpanseteiccaunenpiiacastatsinnsteninedion 11
ey ee re sie nsineccicsacttintnisetsadonpsacenindinltesin 11
Be se I ih ccictesndcendhnisintiinenniasidabnnnbiaaiiedieds 12
ee ee ee eiiccensstncntentncedncebnsdibhinensis 3, 12
xi
TABLE OF AUTHORITIES
(Continued)
Page(s)
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Be I BN Oe I siniitacdececizccnecdelesatemantebvaiien 3, 23
Be Be ee i iciintisicsstcamatpcctinereindeeniseieiuntsinasal 23
oy 2 8 7; SKE ener meee 13
77 Fed. Reg. 9,304 (Feb. 16, 2012)......................ce000 1,2
cf, & % 4 | — Saeugurmscceracess 2, 3, 4, 13, 14, 15
Te ee BE TO A raicicicceiccibaisantsentincianemicionininiannitiini 13
ch, 5 4 ene 4,11, 14, 22
re es Ne HIE I sicctidnccnackiccavepscinnileniecuncnienncednis 15
OT SE, OO FP icetiinctsntisiciieeickstimcctieien 4
Oe i Ne Be IE siitnicideseniiinisibderinentnebetentomissiiiedinnts 14
FE ee BEN OE De icc tencccceseneisncvivntinicconecnsniions 11
cf, 3 4 | ERENCE naan een soon an meer 11
Oe Be, OG Fe wih is acct eksssienicivescettenniensinione 12
ge & Ly 1 SRE ce esrtee ore mcomemies Ornee = 12
Be Be Oe ei ciite cinkesvinninronccheneismiienteieonaons 25
Be Se I etiniiinsdencssiscnsetincnseuniacmanininubie 13
a i So ai aloiiatnaceneenisoncudhs 3, 12, 24
Fe ee Ne siniisciciphinincereiicitiindencsrimenionlns 11
Be Oe a aia icthiniitciichionsviduntintinSinadcianiienaindins 3
OTHER AUTHORITIES
136 Cong. Rec. H12911 (daily ed. Oct. 26, 1990)
PETITION FOR A WRIT OF CERTIORARI
The National Mining Association respectfully
petitions for a writ of certiorari to review the
judgment of the United States Court of Appeals for
the D.C. Circuit.
OPINION BELOW
The opinion of the D.C. Circuit is reported at
White Stallion Energy Center v. EPA, 748 F.3d 1222
(D.C. Cir 2014) and is reproduced at Petition
Appendix (“Pet. App.”) 1a.
JURISDICTION
The D.C. Circuit entered judgment on April 15,
2014. White Stallion, 748 F.3d 1222; Pet. App. 99a.
This Court has jurisdiction under 28 U.S.C. § 1254(1).
STATUTORY AND REGULATORY PROVISIONS
This case was decided under 42 U.S.C. § 7412,
which is reproduced at Pet. App. 10la. The relevant
agency regulation is National Emissions Standards
for Hazardous Air Pollutants from Coal- and Oil-
Fired Electric Utility Steam Generating Units and
Standards of Performance for Fossil-Fuel-Fired
Electric Utility, Industrial-Commercial-Institutional,
and Small Industrial-Commercial-Institutional
Steam Generating Units, 77 Fed. Reg. 9,304 (Feb. 16,
2012), which is reproduced at Pet. App. 196a.
INTRODUCTION
The divided Panel below affirmed regulations
of the Environmental Protection Agency (EPA or
2
Agency) setting standards for the emission of
hazardous air pollutants (HAPs) from electric utility
steam generating units (hereafter electric generators)
under the Clean Air Act (CAA). See 77 Fed. Reg.
9,304, Pet. App. 196a-20la. EPA acted under 42
U.S.C. § 7412(m)(1)(A), Pet. App. 156a, which
authorizes EPA to regulate electric generator HAP
emissions but only if EPA finds that regulation is
“appropriate and necessary.”
EPA projected that these regulations will
inflict $9.6 billion in costs on the American people
annually but will create only $4-6 million in annual
benefit in reduced HAP emissions. 77 Fed. Reg. at
9,306, Table 2, Pet. App. 208a. EPA contends that
this result is “appropriate and necessary,” and the
Panel affirmed. White Stallion, 748 F.3d at 1236-41,
Pet. App. 20a-33a. But there is no possible
interpretation of the words “appropriate and
necessary’ that could lead to such an unbalanced
outcome. No rational person would see spending $9.6
billion for $4-6 million in return as an appropriate
exchange.
EPA and the Panel contend that the Agency is
free to ignore the costs of these regulations in
determining that regulation is “appropriate and
necessary.” White Stallion, 748 F.3d at 1236-41, Pet.
App. 20a-33a. But as Judge Kavanaugh argued in
his dissenting opinion, where, as here, Congress
authorizes regulation only where “appropriate and
necessary,” it is presumptively unreasonable for an
agency not to consider costs and to choose to regulate
despite such absurdly mismatched costs and benefits.
Id. at 1260-66, Pet. App. 71a-85a.
3
The irrationality of EPA’s action is starkly
illuminated by EPA’s conclusion that it is
“appropriate and necessary” to regulate electric
generator acid gas emissions, one of several forms of
hazardous pollutants emitted by electric generators.
77 Fed. Reg. at 9,363, Pet. App. 461a-465a. EPA was
unable to calculate any benefit from regulating
electric generator acid gas emissions, 77 Fed. Reg. at
9,306, Table 2, Pet. App. 208a, and it conceded that
acid gases, in the small quantities emitted by electric
generators, do not pose any risk to public health,
National Emission Standards for Hazardous Air
Pollutants from Coal- and Oi-Fired Electric Utility
Steam Generating Units, Proposed Rule, 76 Fed. Reg.
24,976, 25,016 (May 3, 2011), Pet. App. 1161a, 1342a
(“our case studies did not identify significant chronic
non-cancer risks from acid gas emissions”) and id. at
25,011-12, Pet. App. 1317a-1323a (generator HAP
emissions that may pose a cancer risk do not include
acid gases). The Agency claimed that electric
generator acid gas emissions pose a risk to the
environment, but the only concrete evidence it could
marshal in support is a single study from the United
Kingdom that does not even address. electric
generator acid gas emissions, much less the acid gas
emissions that EPA will now regulate from domestic
generators. 77 Fed. Reg. at 9,362, Pet. App. 457a-
46la. Yet the pollution controls needed to reduce
acid gas emissions under EPA’s regulation drive
much of the $9.6 billion annual overall cost of the
regulation. 76 Fed. Reg. at 25,014, Pet. App. 1327a-
1331a.
Why then did EPA adopt regulations with such
high costs and so little benefit? Not because
Congress commanded that result. The Panel read the
4
term “appropriate” in Section 7412(n)(1)(A) as giving
EPA Chevron step two discretion to either consider or
not consider potential compliance costs. White
Stallion, 748 F.3d at 1238, Pet. App. 25a-26a (EPA’s
interpretation that the term “appropriate” does not
“compel/]” it to consider costs “is clearly permissible”)
(emphasis added). See Chevron, U.SA., Inc. v.
Natural Resources Defense Council, Inc., 467 U-S.
837, 843 (1984). EPA chose to ignore compliance
costs in deeming it “appropriate” to regulate,
claiming this was a “reasonable” interpretation of the
discretion Congress gave it. 77 Fed. Reg. at 9,326-27;
Pet. App. 294a-302a. The decision to adopt
regulations with such unbalanced costs and benefits,
therefore, was EPA’s, not Congress’.
The reason why EPA chose such a seemingly
irrational outcome is obvious but largely ignored by
the Panel decision. The pollution-control equipment
that electric generators must install to control acid
gases also reduces emissions of sulfur dioxide (SOz2), a
non-hazardous pollutant that is not subject to
regulation under Section 7412. 76 Fed. Reg. at
25,014, Pet. App. 1327a-133la. Sulfur dioxide can
convert in the atmosphere to fine particles (PMz2>5),
and EPA believes that reducing atmospheric fine
particle concentrations will produce tens of billions of
dollars in annual benefit in reduced mortality and
disease. 77 Fed. Reg. at 9,306, Table 2, n. b, Pet.
App. 208a. However, even EPA was forced to concede
that reducing fine particle concentrations is not a
valid objective under Section 7412, id. at 9,320, Pet.
App. 268a-272a, and, in any event, EPA is already
required under the CAA Title I National Ambient Air
Quality Standards program to control fine particle
5
concentrations to safe levels. See Nat? Ass’n of Mfrs.
v. EPA, 750 F.3d 921 (D.C. Cir. 2014).
EPA’s “appropriate and necessary”
determination thus is a textbook case of the
administrative misuse of statutory authority. The
Agency has adopted a regulation that no rational
person would adopt in order to achieve an objective
that the statutory program under which it is acting
does not authorize. Motor Vehicle Mfrs. Ass'n v. State
Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)
(“Normally, an agency rule would be arbitrary and
capricious if the agency has relied on factors which
Congress has not intended it to consider.”). See also
Chevron, 467 U.S. at 8444 (under step two, agency
statutory interpretation must be “reasonable’).
The Panel’s decision thus raises issues of
exceptional importance that warrant granting this
Petition under Rule 10(a). In the first place, EPA’s
regulations are “among the most expensive rules that
EPA has ever promulgated.” JAMES E. MCCARTHY,
CONG. RESEARCH SERV., R42144, EPA’s U
MACT: WILL THE LIGHTS GO OUT? 1 (2012), as cited in
Judge Kavanuagh’s dissenting opinion, White
Stallion, 748 F.3d at 1263, Pet. App. 78a. In his
opinion, Judge Kavanaugh provided some context for
the $9.6 billion annual cost of the rule:
To put it in perspective, that amount
would pay the annual health insurance
premiums of about two million
Americans. It would pay the annual
salaries of about 200,000 members of the
U.S. Military. It would cover the annual
6
budget of the National Park Service
three times over.
Id. at 1263, Pet. App. at 77a-78a.
The decision also has enormous precedential
importance for administrative law. Regulatory
decisionmaking in the modern state inevitably
involves trade-offs. “[E]very real choice requires a
decisionmaker to weigh advantages against
disadvantages, and disadvantages can be seen in
terms of (often quantifiable) costs.” Entergy Corp. v.
Riverkeeper, Inc. 556 U.S. 208, 232 (2009). Of course,
Congress is free to command regulation no matter the
cost. Whitman v. American Trucking Associations,
531 U.S. 457, 466 (2001) (finding that Congress did
not intend EPA to consider compliance costs in
setting ambient air quality standards). But Congress
issued no such command here. It mandated
regulation only if “appropriate and necessary.” To
hold that such a standard can be interpreted as
authorizing the Agency to ignore the costs of its
regulations, where the Agency itself finds that the
costs and benefits are so disproportionate, is to
undermine one of the key pillars on which judicial
review of agency action is based—that agencies must
act “within the bounds of reasonable interpretation.”
Utility Air Regulatory Grp., 573 U.S. at ___ (June 23,
2014), slip op. at 16, citing Arlington v. FCC, 569 U.S.
(2013) (slip op. at 5)). Recently, this Court
reiterated that it expects Congress to speak clearly if
it wishes to authorize an agency to make decisions of
vast “economic and political significance.” Utility Air
Regulatory Grp., 573 U.S. at __., slip op. at 19 (citing
cases). Little remains of that principle if an agency
can convert a Congressional command to regulate
7
only as “appropriate” into a green light for imposing
massive costs for little benefit, while disclaiming the
responsibility to consider costs at all.
STATEMENT OF THE CASE
1. As part of the comprehensive 1990 CAA
Amendments, Congress rewrote how EPA should
regulate HAPs. 42 U.S.C. § 7412. See New Jersey v.
EPA, 517 F.3d 574, 581-83 (D.C. Cir. 2008). Congress
listed more than 100 HAPs, 42 U.S.C. § 7412(b), and
directed EPA to create a list of categories of sources
that emit those HAPs above statutorily-defined
thresholds, 42 U.S.C. § 7412(c). Congress further
directed EPA to establish HAP control standards for
each of the source categories that EPA listed. 42
U.S.C. § 7412(b).
Congress, however, adopted a_e different
regulatory scheme for the emission of HAPs from
electric generators. In 42 U.S.C. § 7412(n)(1)(A),
Congress required EPA to perform a study of the
“hazards to public health” from electric generator
HAP emissions “after imposition of [other]
requirements of’ the CAA. Congress directed that
the study also include a report on “alternative contro]
strategies for emissions which may warrant
regulation under this section.” Jd. Congress further
required EPA to regulate electric generator HAP
emissions under Sectiomu 7412 but only if it “finds
such regulation is appropriate and necessary after
considering the results of the study required by this
subparagraph.” Jd. (emphasis added).
Congress treated electric generators differently
from other source categories of HAP emissions
8
because the 1990 CAA Amendments contained a
number of other programs which would have the
effect of reducing electric generator HAP emissions.
Revision of December 2000 Regulatory Finding on the
Emissions of Hazardous Air Pollutants from Electric
Utility Steam Generating Units and the Removal of
Coal- and Oil-Fired Electric Utility Steam Generating
Units from the Section 112(c) List, 70 Fed. Reg.
15,994, 15,999 (Mar. 29, 2005). These programs
included the Title IV Acid Deposition Control)
program, which established a cap-and-trade system
for electric generator emissions of SO2 and nitrogen
oxides (NO,) in. order to reduce the effect these
pollutants have on the acidification of aquatic and
other ecosystems. 42 U.S.C. §§ 7651-7651o.
Congress believed that electric generator HAP
standards might not be necessary in light of these
other programs, and it was also concerned that the
electric utility industry might become overburdened
with air pollution control costs. See 136 Cong. Rec.
H12911, 12934 (daily ed. Oct. 26, 1990) (statement of
Congressman Oxley) (stating that the conferees
adopted section 7412(n)(1)(A) “because of the logic of
basing any decision to regulate on the results of
scientific study and because of the emission
reductions that will be achieved and the extremely
high costs that electric utilities will face under other
provisions of the new Clean Air Act amendments.”).
2. EPA completed the study called for by
sae HEA seersed Study) in 1998. See
; That study did not 9 any finding om that
section. It concluded that “mercury from coal-fired
utilities is the HAP of greatest potential concern.”
Utility Study at ES-27, Pet. App. 1940a. The study
9
found no health impacts from electric generator
emissions of acid gases (hydrogen chloride and
fluoride). Jd. at ES-23, Pet. App. 1937a-1939a. EPA
noted that acid gas emissions “may” possibly
contribute to environmental harms but recognized
that these impacts could also be addressed through
other provisions of the Act. Jd.
Based on the Utility Study, EPA in 2000 issued
a non-final “notice of regulatory finding” that it was
“appropriate and necessary” to regulate electric
generators. Regulatory Finding on the Emissions of
Hazardous Air Pollutants from Electric Utility Steam
Generating Units, 65 Fed. Reg. 79,825 (Dec. 20,
2000). EPA’s finding was based on the hazards to
public health that EPA perceived from mercury
emissions from coal-fired electric generators and, to a
lesser extent, the effects of nickel emissions from oil-
fired electric generators. Jd. at 79,827, 79,828, Table
1. EPA made no findings as to acid gas emissions
other than to briefly note that these emissions are of
“potential concern and may be evaluated further
during the regulatory development process.” Jd. at
79,827. EPA then listed electric generators for
regulation under Section 7412(c) but deferred
establishing control standards. National Emission
Standards for Hazardous Air Pollutants: Revision of
Source Category List Under Section 112 of the Clean
Air Act, 67 Fed. Reg. 6,521 (Feb. 12, 2002).
In 2005, based on new information, EPA
undertook rulemaking for the first time to evaluate
whether regulating electric generator HAP emissions
under Section 7412(n)(1)(A) was “appropriate and
necessary.” Unlike its non-final 2000 finding, which
contained very little discussion of Congressional
10
intent, the Agency’s 2005 finding provided a lengthy
discussion of the reasons why Congress chose to
uniquely authorize the regulation of electric
generators only if “appropriate and necessary.” 70
Fed. Reg. at 15,997-16,002. Based on its analysis,
EPA concluded that costs should be considered in
determining whether regulation is “appropriate” and
that, as a result, “it might not be appropriate” to
regulate electric generator HAP emissions “if the
health benefits expected as the result of such
regulation are marginal and the cost of such
regulation is significant and therefore substantially
outweighs the benefits.” Jd. at 16,000-01.
EPA did not reach the merits of that
question—whether the benefits of Section
7412(n)(1)(A) regulation of electric generator HAP
emissions was worth the | cost—because EPA
determined that, given other CAA programs, electric
generator HAP emissions did not pose a meaningful
health risk. 70 Fed. Reg. at 16,002. Because EPA
had decided to regulate electric generator mercury
emissions under another CAA program, it concluded
that any remaining impacts from those emissions
would be insignificant. Jd. EPA further concluded
that non-mercury HAPs emitted by electric
generators should not be regulated under Section
7412, id. at 16,006-07, noting that further research
on acid gas emissions confirmed the absence of any
health impact, id. at 16,007. EPA therefore
determined that it was not “appropriate and
necessary” to regulate electric generator HAP
emissions and removed electric generators from the
Section 7412(c) list. Jd. at 15,994.
11
EPA’s 2008 “delisting” decision, however, was
reversed and vacated by the D.C. Circuit in New
Jersey v. EPA, 517 F.3d at 581-83, on the ground that
EPA had not made the delisting findings required by
Section 7412(c)(9).
3. On remand of New Jersey, EPA
promulgated the rule at issue here. EPA again
reversed course and determined that its original 2000
“appropriate and necessary” finding was valid when
made. 77 Fed. Reg. at 9,320, Pet. App. 268a-272a.
EPA also asserted that new information further and
independently justified the appropriateness and
necessity of regulating electric generator emissions of
mercury, non-mercury trace metals, and acid gases.
Id. at 9,362-64, Pet. App. 457a-470a.
a. Mercury Emissions.
The additional mercury information that EPA
examined in its 2012 rulemaking involved an
analysis of the watersheds in the United States
where mercury concentrations were high enough to
present a risk to a hypothetical high-risk individual,
based on the threshold risk level identified in an
earlier National Academy of Sciences report. See
generally 76 Fed. Reg. at 25,007-10, Pet. App. 1298a-
1314a, 77 Fed. Reg. at 9,344-56, Pet. App. 374a-434a.
EPA defined the hypothetical high-risk individual as
an unborn child of a pregnant woman who primarily
subsists on self-caught fish from local waters. 76
Fed. Reg. at 25,007, Pet. App. 1299a-1300a. EPA
then assumed that this individual consumes 13
ounces of locally caught fish every day during her
pregnancy, 77 Fed. Reg. at 9,349, Pet. App. 397a, and
that the mercury levels in the fish represent some of
12
the highest levels measured in each of the fresh
water rivers and lakes for which EPA could find data,
id., Pet. App. 397a-401a. Although data are available
for only four percent of the watersheds in the country,
EPA applied its findings equally across all 88,000
watersheds in the United States. 76 Fed. Reg. at
25,007, Pet. App. 1302a. Based on this analysis, EPA
claimed that at least one hypothetical high-risk
individual may be present in 10 percent of all
watersheds (when considering utility emissions
alone) and 24 percent of all watersheds (when
considering all global emissions). 77 Fed. Reg. at
9,362, Pet. App. 459a.
b. Non-Mercury Trace Metals.
As noted above, EPA’s 2000 “appropriate and
necessary” finding indicated that nickel emissions
from oil-fired units was the only non-mercury trace
metal that presented a potential risk. To support its
2012 finding, EPA modeled the emissions of nickel
and a number of other trace metals from 16 facilities
to determine the exact location of the highest impact
from the emissions for each facility. 76 Fed. Reg. at
25,011-12, Pet. App. 1317a-1323a, 77 Fed. Reg. at
9,357-62, Pet. App. 434a-461a. EPA then assumed
that a hypothetical individual would remain at that
exact location 24 hours a day, 365 days a year, for 70
years to determine whether the increased cancer risk
for that individual would exceed one-in-one-million.
77 Fed. Reg. at 9,358, Pet. App. 442a.
Using that framework, EPA determined that
four electric generation facilities—three coal-fired
facilities and one oil-fired facility—could potentially
increase the cancer risk to a hypothetical high-risk
13
individual by greater than one-in-one-million. 76
Fed. Reg. at 25,011, Pet. App. 1317a. However, the
only pollutants driving those increased risks were
chromium+6 (for the coal-fired facility) and nickel (for
the oil-fired facility). Jd. EPA determined that no
other pollutant resulted in a significant cancer risk,
and EPA determined that all non-cancer risks were
also insignificant. Jd.
Cc. Acid Gas Emissions.
As speculative as EPA’s analyses of mercury
and non-mercury trace metals were, EPA did not
even try to conduct any further analysis of any
impacts of electric generator acid gas emissions that
might remain after other CAA regulation. EPA
conceded that electric generator acid gas emissions do
not pose a health risk, but claimed that “acid gas
HAP pose a hazard to the environment because they
contribute to aquatic acidification.” 77 Fed. Reg. at
9,310, Pet. App. 228a. The Agency, however, did not
provide any analysis of why acid gas emissions, in the
amount emitted by electric generators’ given
compliance with the CAA Title IV Acid Deposition
Control] program, pose an acidification risk. The only
empirical evidence that EPA cited was a study of acid
deposition in the United Kingdom, which obviously
did not examine whether the electric generators that
will be subject to the rule here emit acid gases in
sufficient quantity to cause a regulatory concern. 77
Fed. Reg. at 9,361-62, Pet. App. 452a-461a. Indeed,
the study did not examine electric generator acid gas
emissions at all. Jd.
A. EPA proceeded to promulgate stringent
control requirements to minimize emission of all
14
HAPs emitted by electric generators. 76 Fed. Reg. at
25,102-47, Pet. App. 898a-1936a. EPA estimated that
the annual compliance cost of these regulations
would be $9.6 billion. 77 Fed. Reg. at 9,306, Table 2,
Pet. App. 208a. In contrast, EPA estimated that the
benefit of regulating these substances was only $4-$6
million annually. Jd. A substantial part of the
control costs results from the need for numerous
generators to install expensive SO:2 control equipment
as a means of controlling acid gas emissions. 76 Fed.
Reg. at 25,014, Pet. App. 1327a-1331a. None of the
EPA-estimated $4-6 million in annual regulatory
benefits, however, comes from reducing acid gas
emissions. 77 Fed. Reg. at 9,306, Table 2, Pet. App.
208a.
EPA claims that, overall, the regulation will
create $33-$90 billion in benefits. Jd., n. b, Pet. App.
208a. But virtually all of this amount consists of
what EPA describes as a “co-benefit” of reducing SO2
emissions, because SO2 converts in the atmosphere to
fine particles which, according to EPA, cause
increased mortality and morbidity. Jd. However,
because SO2 and fine particles are not HAPs, EPA
recognizes, as it must, that it cannot rely on these
asserted co-benefits in deeming it to be “appropriate
and necessary” to regulate electric generator HAPs.
77 Fed. Reg. at 9,320, Pet. App. 268a-272a.
Aware of the yawning disparity between the
costs and benefits of its regulations, EPA decided to
change its previous interpretation that regulatory
costs should be considered in making the
“appropriate and necessary” determination. 77 Fed.
Reg. at 9,327, Pet. App. 298a-302a. EPA now decided
that it could ignore control costs. Jd. The Agency
15
asserted that ignoring costs was reasonable given
what it viewed as Congress’ overriding concern to
regulate the public health and environmental
hazards of electric generator HAP emissions as
quickly as possible and no matter the costs involved.
Id. And EPA sought to further immunize its decision
to regulate acid gas emissions by interpreting Section
7412 as requiring EPA to regulate acid gas
emissions—even if those emissions do not pose a
health or environmental danger—so long as EPA
could find that electric generator emissions of
another hazardous pollutant do pose a danger. /d. at
9,325-26, Pet. App. 290a-298a.
REASONS FOR GRANTING THE PETITION
Certiorari should be granted to review the
Panel’s decision. The regulation at issue indisputably
entails massively high compliance costs for virtually
no benefit from reducing HAP emissions. 77 Fed.
Reg. at 9,306, Table 2, Pet. App. 208a. The Panel
sanctioned this result on the ground that an
ambiguous statutory term—authorizing EPA to
regulate if “appropriate”’—could reasonably be
construed as a congressional authorization of
regulation regardless of the cost. White Stallion, 748
F.3d 1236-41, Pet. App. 20a-33a. But this Court has
consistently held, most recently this past term, that it
will not read into a statute the authority for an
agency to engage in highly consequential regulation
unless Congress has “spfoken] clearly.” Utility Air
Regulatory Grp., 573 U.S. at __, slip op. at 19.
That principle is at issue in this case.
Although Congress could, of course, authorize
regulation without regard to the cost, it did not do so
16
here. It only authorized “appropriate” regulation. As
Judge Kavanaugh wrote, it is presumptively
unreasonable for an agency, given authority to
regulate where “appropriate,” to ignore costs and to
thereby produce regulation with costs that are nearly
2,000 times higher than its benefits. White Stallion,
748 F.3d at 1266, Pet. App. 83a-85a. The
irrationality of EPA’s decisionmaking is made even
worse by the fact that the Panel sanctioned EPA's
view that it can regulate all electric generator HAPs,
even those that do not pose a health or environmental!
risk, so long as some electric generator HAPs do pose
such-a risk. Jd. at 1244, Pet. App. 37a-39a. The
regulatory scheme the Panel has approved thus
would not only entail massively high regulatory costs
for little health or welfare benefit; in addition, much
of those costs could be expended for no benefit. Given
the far-reaching precedential impact this decision
could have for all forms of government regulation,
this Court should not let the Panel’s decision stand.
I. EPA Unreasonably Failed to Consider
Costs.
Both the Panel and EPA asserted that because
the term “appropriate” is ambiguous, the Agency had
discretion to interpret the term under Chevron step
two. White Stallion, 748 F.3d at 1237, Pet. App. 23a-
25a. But statutory ambiguity does not mean that an
agency's discretion is uncabined. As this Court has
consistently held, “[e]ven under Chevron’s deferential
framework, agencies must operate ‘within the bounds
of ‘reasonable interpretation.” Utility Air Regulatory
Grp., 573 U.S. at __., slip op. at 16 (citing Arlington
v. FCC, 569 U.S.__, ___ (2013) (slip op. at 5)).
17
Moreover, as the D.C. Circuit has noted, “the
range of permissible interpretations of a statute is
limited by the extent of its ambiguity;” an agency
cannot “put forth a reading that diverges from any
realistic meaning of the statute.” Massachusetts v.
United States DOT, 93 F.3d 890, 893 (D.C. Cir. 1996);
see also Massachusetts v. EPA, 549 U.S. 497, 533
(2007) (agency must “exercise discretion within
defined statutory limits”). Contrary to the Panel’s
reading, there is no “realistic meaning” of the term
“appropriate” that encompasses the mismatch of costs
and benefits that EPA’s regulation creates. See MCI
Telcomms. Corp. v. AT&T, 512 U.S. 218, 231 (1994)
(disapproving agency statutory interpretation as
leading to “highly unlikely” result). The dictionary
defines “appropriate” as “especially suitable or
compatible” or “fitting.” MERRIAM-WEBSTER ONLINE
DICTIONARY, http://www.merriam-webster,com/
dictionary/appropriate (last visited July 8, 2014). A
regulatory scheme that produces costs almost 2,000
times its benefits is not one that is “especially
suitable,” “compatible” or “fitting” under any common
understanding of those terms. See FDIC v. Meyer,
510 U.S. 471, 476 (1994) (“we construe a statutory
term in accordance with its ordinary or natural
meaning” unless Congress has otherwise specified).
Indeed, EPA conceded that the term
appropriate is “extremely broad,” 76 Fed. Reg. at
24,988, Pet. App. 1216a, and the Panel similarly
characterized the term as “broad,” White Stallion, 748
F.3d at 1237, Pet. App. 25a. Congress’ use of such a
broad term contradicts EPA’s and the Panel’s
conclusion that Congress was narrowly focused on
regulation no matter the cost. Christopher uv.
SmithKline Beecham Corp., 132 S. Ct. 2156, 2171
18
(2012) (“broad” statutory term should not be given an
unreasonably limited construction); Harrison v. PPG
Industries, Inc., 446 U.S. 578, 588-89 (1980)
(Congress’ use of “expansive language” contradicts a
more limited reading of a statutory term). “It is the
settled law of this circuit,” the D.C. Circuit has said,
that “[i]t is only where there is a ‘clear congressional
intent to preclude consideration of cost’ that we find
agencies barred from considering costs.” Michigan v.
EPA, 213 F.3d 663, 678 (D.C. Cir. 2000) (quoting
NRDC v. EPA, 824 F.2d 1146, 1163 (D.C. Cir. 1987).
The use of a “broad” term like “appropriate” is hardly
consistent with a “clear congressional” intent to
exclude costs. !
The Panel properly recognized that the
meaning of facially ambiguous terms must be
discerned through their “context” in the statute.
White Stallion, 748 F.3d at 1237, Pet. App. 24a (citing
Sossamon v. Texas, 131 S. Ct. 1651, 1659 (2011) for
the proposition that the term “appropriate” is
“inherently context-dependent”). But, as noted above,
this Cour! has said, “[wje expect Congress to speak
! The Panel contended that Michigan may have authorized EPA
to consider costs here but did not command it. White Stallion,
748 F.3d at 1236, Pet. App. 20a-23a. But EPA's discretion to
either consider or not consider costs must be exercised
reasonably; as Judge Kavanuagh wrote, failing to consider costs
in deeming regulation “appropriate” is unreasonable. Id. at
1266, Pet. App. 83a-85a. Whitman is not to the contrary. In
Whitman, 551 U.S. at 466-68, this Court ruled that EPA may
not consider costs in setting ambient air quality standards
under 42 U.S.C. § 7409(b)(1) because the statutory command to
establish standards that are “requisite to protect the public
health” does not “leave room” to consider costs. In contrast, the
broad phrase “appropriate and necessary” leaves ample room for
consideration of costs.
19
clearly if it wishes to assign to an agency decisions of
vast ‘economic and political significance.” Utility Air
Regulatory Grp., 573 U.S. __, slip op at 19 (citing
FDA v. Brown & Williamson Tobacco Corp., 529 U.S.
120, 133 (2000)). The Panel’s contextual analysis
reveals no such clear intent.
The Panel gave controlling weight to the fact
that other subsections of Section 7412 provide for the
consideration of costs, while Section 7412(m)(1)(A)
supposedly does not. White Stallion, 748 F.3d at
1237-38, Pet. App. 23a-27a. But the Panel
continually mischaracterizes the Section
7412(n)(1)(A) study as being limited to an
examination of the health effects of electric generator
HAP emissions, with Congress giving “no signal” that
regulatory compliance costs would be relevant. White
Stallion, 748 F.3d at 1240, Pet. App. 29a. Section
7412(n)(1)(A), however, requires that EPA study both
health effects and “alternative control strategies for
emissions which may warrant regulation.” The
mandate for EPA to consider compliance options is
not consistent with a congressional intent to
authorize EPA to deem the cost of those compliance
options irrelevant. Ali v. Federal Bureau of Prisons,
552 U.S. 214, 222 (2008) (statutory terms should be
construed to be “coherent and consistent”).
The Panel also concluded that EPA’s decision
not to consider costs was consistent with Congress’
overall purpose in Section 7412 to “spur EPA to
action” in regulating HAPs. White Stallion, 748 F.3d
at 1238, Pet. App. 26a. Given this purpose, the Panel
read Section 7412(n)(1)(A) as doing nothing more
than providing EPA with a “three-year pass” to
“confirm the nature of public health hazards from
20
EGU [electric generator] emissions,” after which
regulation becomes mandatory. Jd. at 1238-39, Pet.
App. 26a-29a.
Petitioners do not dispute that the Section
7412 technology-based regulatory structure, for non-
electric-generator source categories, limits EPA's
discretion as compared with the previous statutory
HAP program. Thus, in contrast to the pre-1990
version of Section 7412, White Stallion, 748 F.2d at
1230 Pet. App. 9a, the provision now establishes a
simple two-step regulatory process that limits EPA’s
discretion in deciding whether and how to impose
new emission standards. First, EPA must determine
whether a source category emits one of the many
HAPs that Congress specified in 42 U.S.C. § 7412(b)
in quantities that exceed the statutorily-defined
threshold. 42 U.S.C. § 7412(c). EPA must then
establish emissions-control standards that are at
least as stringent as the standards that would result
from the application of a statutory formula. 42
U.S.C. § 7412(d).
It is also true, however, that Congress
established a separate procedure for determining
whether electric generator HAP emissions should be
regulated. Although electric generators emit HAPs
that are included on the Section 7412(b) list in
amounts that exceed the statutory threshold,
Congress did not automatically require EPA to
regulate under Section 7412(d). Not only did
Congress mandate a study of both health hazards
and potential compliance options, Congress also
authorized regulation only if it was “appropriate and
necessary.” Had Congress intended that the normal
statutory procedure would be triggered if EPA found
21
that electric generator HAPs create a health hazard,
it would have been a simple matter to direct EPA,
upon making a health hazard finding, to conform to
the statutory procedure for regulating every other
source category of HAPs—to list generators under
Section 7412(c) and then set standards under Section
7412(d). Instead, Congress chose to granted EPA
much broader to choose to regulate—or not—within
the broad confines encompassed by the phrase
“appropriate and necessary.” See Central Bank of
Denver v. First Interstate Bank of Denver, 51) U.S.
164, 176-77 (1994) (failure of Congress to include a
specific provision in one part of statute, where it
included that provision in another, is evidence of
Congress’ differing intent for the two provisions).
Indeed, the Panel itself implicitly recognized
that the broad phrase “appropriate and necessary”
gave EPA the authority to decline to regulate even if
the Utility Study found that electric generator HAPs
create a health hazard. Under the logic of the Panel’s
Chevron step two analysis, since EPA could have
made the choice to consider costs, it could also have
decided that regulatory costs so exceeded regulatory
benefits as to make regulation inappropriate.?
2 Moreover, both EPA and the Panel conclude that EPA can
regulate electric generator HAP emissions if it finds that these
emissions cause environmental impacts, even through the
Section 7412(n)(1)A) study that Congress mandated was limited
to health effects. White Stallion, 748 F.3d at 1241-42, Pet. App.
31a-35a. Neither the Panel nor EPA explain why it is consistent
to use the “appropriate and necessary” finding to expand
regulation to environmental! impacts while limiting that finding
to exclude costs.
22
Of course, as discussed, even if EPA’s Section
7412(n)(1)(A) discretion is broad, EPA must still
exercise that discretion reasonably. In the end, then,
the issue before the D.C. Circuit was whether EPA
reasonably exercised its discretion by determining
not to consider costs and that it was therefore
“appropriate” to adopt massively costly regulations
for virtually no return. The Panel attempted to
dismiss this irrational result by citing EPA’s claim of
$37-$90 billion in annual benefits. White Stallion,
748 F.3d at 1240, Pet. App. 30a. But the Panel failed
to note that these benefits do not result from
regulating hazardous pollutants or that even EPA
itself said it could not rely on these benefits to justify
the rule. 77 Fed. Reg. at 9,320, Pet. App. 268a-272a.
As a result, the rationality of EPA’s decision must be
judged based on the stark contrast between $4-6
million in annual benefits and $9.6 billion in annual
costs. That Congress would have intended such an
outcome is improbable, to say the least. Brown &
Williamson, 529 U.S. at 133 (in construing statutes,
“we must be guided to a degree by common sense as
to the manner in which Congress is likely to delegate
a policy decision of such economic and political
magnitude to an administrative agency.”); Am.
Tobacco Co. v. Patterson, 456 U.S. 63, 71 (1982)
(“Statutes should be interpreted to avoid
unreasonable results whenever possible.”).
Il. EPA’s Regulation of Acid Gases
Demonstrates the Irrationality of EPA’s
Approach.
EPA's regulation of electric generator acid gas
emissions is the definition of unreasonable agency
decisionmaking, EPA is attempting to regulate
23
emissions that it cannot show are a risk to the public
health or welfare in order to accomplish an objective
that Congress did not authorize, while asserting a
legal theory that would justify regulation for no
reason.
A. As noted above, the Panel said that
Section 7412(n)(1)(a)’s purpose was to allow EPA to
“confirm the nature of public health hazards from
EGU [electric generator] emissions.” White Stallion,
748 F.3d at 1239, Pet. App. 29a. But neither the
Utility Study, Utility Study, ES-23, Pet. App. 1937a,
nor the only study that EPA performed thereafter of
the health risks of electric generator acid gas
emissions, 70 Fed. Reg. at 16,007, found any such
risks. Indeed, EPA conceded in the regulatory
preamble that acid gases do not create a cancer risk,
76 Fed. Reg. at 25,016, Pet. App. 1339a, and that
“fojur case studies did not identify significant chronic
non-cancer risks from acid gas emissions,” id. The
best EPA could do in the regulation was to express
“concern{]” that acid gases in general are known to
“contribute to chronic non-cancer toxicity,” without
making any finding that acid gases in the quantities
emitted by generators pose a meaningful risk of doing
so. Id., Pet. App. 1339a.
Even EPA’s findings as _ to _ possible
environmental impacts of electric generator acid gas
emissions lacked a_ substantive base. EPA’s
“evidence” of the environmental impacts of these
emissions consists of EPA’s general claim that “[iJn
areas where the deposition of acids derived from
emissions of sulfur and NO, are causing aquatic
and/or terrestrial acidification, with accompanying
ecological impacts, the deposition of hydrochloric acid
24
could exacerbate these impacts.” 76 Fed. Reg. at
25,050, Pet. App. 1482a-1483a (emphasis added).
That may be true, but it does not prove—or even lead
to an inference—that electric generators emit acid
gases in sufficient amounts, given EPA’s other
regulations, to create a material environmental
concern. The Utility Study did not conclude that
electric generator acid gas emissions resulted in
environmental harm, Utility Study at ES-23, Pet.
App. 1937a-1939a, and EPA did not conduct any
further study of possible environmental impacts of
electric generator acid gas emissions.
The only further acid gas study that EPA
relied on was one study of hydrochloric acid
deposition in the United Kingdom, which EPA cites
for the proposition that (a) hydrochloric acid is highly
mobile in the environment, (b) hydrochloric acid can
transport longer distances than previously thought,
and (c) hydrochloric acid can be a larger driver of
acidification than previously thought. 77 Fed. Reg. at
9,362, Pet. App. 457a-458a. EPA, however, did not
even try to analyze the impact, if any, of electric
generator emissions of hydrochloric acid in the United
States and, as a result, could not point to even a
single instance in which electric generator
hydrochloric acid emissions have affected acid
deposition anywhere or otherwise created an
environmental impact.
Indeed, EPA simply ignored the requirement of
Section 7412(n)(1)(A) that EPA determine whether it
is “appropriate and necessary” to regulate electric
generator acid gas emissions based on a study of the
public health risk that these emissions pose “after
imposition of the requirements of this Act.” Sulfur
25
dioxide is stringently regulated under the NAAQS
program. Nat? Envtl. Dev. Ass'n Clean Air Project v.
EPA, 686 F.3d 803 (D.C. Cir. 2012). EPA is required
to set a secondary standard for SOz2 that protects the
public welfare, 42 U.S.C. § 7409(b)(2), which includes
protection against environmental harm, 42 U.S.C. §
7602(h). Moreover, the 1990 CAA Amendments
specifically establish a program to control electric
generator SOz emissions for the purpose of
minimizing acid deposition. 42 U.S.C. §§ 7651-7651«
But EPA never determined that regulating electric
generator acid gas emissions remains necessary in
light of these programs. Indeed, EPA never
examined in the rulemaking whether any areas of the
United States are in nonattainment of EPA’s
secondary SOz NAAQS and, if so, whether electric
generators were responsible.
EPA’s failure to examine whether acid gas
emissions actually pose a meaningful environmental
risk given other regulation highlights the ultimate
arbitrariness of EPA’s approach here. Much of the
cost of the regulation is driven by the need to control
acid gases. 76 Fed. Reg. at 25,014, Pet. App. 1327a-
133la. Yet the only benefit that EPA can show from
the expenditure of these costs (a reduction in
atmospheric fine particle levels) is one that EPA
cannot lawfully consider in this case. State Farm,
463 U.S. at 43 (“Normally, an agency rule would be
arbitrary and capricious if the agency has relied on
factors which Congress has not intended it to
consider.”).
B. EPA alternatively justified its regulation
of electric generator acid gas emissions by claiming
that the Act does not require it to find that those
26
emissions endanger the public health or environment
in order for EPA to regulate them. 77 Fed. Reg. at
9,361, Pet. App. 452a-453a. Instead, EPA says it can
piggyback on a public health or 2nvironmental
hazard finding that it makes for another electric
generator HAP. Id. Citing Nat7 Lime Ass’n v. EPA,
233 F.3d 625 (D.C. Cir. 2000), EPA stated that once it
regulates any hazardous air pollutant emitted by
electric generators under Section 7412, it must
regulate all such pollutants. Jd. The Panel agreed.
White Stallion, 748 F.3d at 1244-45, Pet. App. 37a-
4la,
Both EPA and the Panel, however, misread
National Lime. In that case, the Court held that
because EPA had a “clear statutory obligation to set
emission standards for each listed HAP{,] ... the
absence of technology-based pollution control devices
for HCl, mercury, and total hydrocarbons did not
excuse EPA from setting emission standards for those
pollutants.” National Lime, 233 F.3d at 634. But the
issue in the present case for acid gases is not whether
EPA can decline to adopt technology-based standards
given the unavailability of control technology. The
issue is the potential for hugely costly regulation of a
substance that has not been appropriately found to
pose a health or environmental danger.
More fundamentally, the court failed to
account for the different regulatory structure in
National Lime as compared with the present case. In
National Lime, the court relied on the fact that
Congress had listed all the hazardous pollutants that
EPA regulated. National Lime, 233 F.3d at 634 (EPA
must set emission standards “for each listed HAP’).
Congress had thus predetermined that lime plant
27
HAP emissions presented a health danger, so long as
EPA determined under Section 7412(c) that lime
plants emitted HAPs in amounts exceeding the
Congressionally-set thresholds, which it did. Jd. at
629-30.
Congress cannot be said to have made that
predetermination here. Although Congress listed all
the pollutants that EPA regulated, it did not direct
EPA to list electric generators under Section 7412(c),
and to regulate them under Section 7412(d), if the
Agency determined that generators emitted HAPs in
amounts exceeding the statutory threshold. Instead,
Congress specifically tasked EPA with undertaking
the “Utility Study” to determine whether HAPs, as
emitted by electric generators after compliance with
other CAA regulation, posed a health hazard. Thus,
Congress delegated to EPA the task of determining
whether electric generator emissions of the listed
pollutants were indeed hazardous and it directed
EPA to regulate only if “appropriate and necessary.”
Norwest Bank Minn. Natl Ass’n v. FDIC, 312 F.3d
447, 451 (D.C. Cir. 2002) (“When both specific and
general provisions cover the same subject, the specific
provision will control.”).
Moreover, regulation under Section
7412(n)(1)(A) is pollutant-specific. The study that
Section 7412(n)(1)(A) requires as a precondition to
regulation includes reporting on control strategies
“for emissions which may warrant regulation under
this section.” Since Congress directed EPA to
regulate based on the results of the study, Congress
must have intended that EPA regulate emissions that
warrant regulation and, logically enough, not
regulate emissions that do not warrant regulation.
28
Hibbs v. Winn, 542 U.S. 88, 101 (2004) (statutory
term must be given meaning in the context of the
words around it); Ali, 552 U.S. at 222 (statutory
terms should be construed to be “coherent and
consistent”).
Thus, the Panel is wrong in saying that “[t]he
notion that EPA must ‘pick and choose’ among HAPs
in order to regulate only those substances it deems
most harmful is at odds with the court’s precedent.”
White Stallion, 748 F.3d at 1245, Pet. App. 39a
(emphasis added). It is not a question of some
substances being more harmful! than others; it is a
question of whether EPA may regulate electric
generator acid gas emissions without having to show
that it is “appropriate” to regulate them by
identifying a meaningful harm. Surely, given that
Congress did not predetermine that these emissions
create public health or environmental impacts and
instead left that determination to EPA, the Agency
cannot regulate unless it can show a meaningful
impact. See Coal. For Responsible Regulation v. EPA,
684 F.3d 102, 135 (D.C. Cir. 2012) (“[i]t is absurd to
think that Congress intended to subject stationary
sources to the PSD permitting requirements due to
emissions of substances that do not ‘endanger the
public health or welfare.”).
In sum, Congress directed EPA to regulate
where “appropriate and necessary.” Regulating
substances that do not pose a health or
environmental danger is neither appropriate nor
necessary even if that regulation is inexpensive. But
spending billions of dollars annually to regulate
substances that have not been shown to be harmful is
beyond inappropriate. It is irrational.
29
CONCLUSION
For the foregoing reason, the Court should
grant this Petition for a Writ of Certiorari.
Respectfully submitted,
CARROLL W. MCGUFFEY ITI PETER S. GLASER
JUSTIN WONG (Counsel of Record)
TROUTMAN SANDERS LLP TROUTMAN SANDERS LLP
600 PEACHTREE STREET, NE 401 NINTH STREET N.W.
SUITE 5200 SUITE 1000
ATLANTA, GA 30308-2216 WASHINGTON, D.C. 20004
202-274-2998
Peter.glaser@
troutmansanders.com
July 14, 2014 Counsel for Petitioner
APPENDIX
la
APPENDIX A
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
No. 12-1100
WHITE STALLION ENERGY CENTER, LLC,
Petitioner,
Vv.
ENVIRONMENTAL PROTECTION AGENCY,
Respondent;
AMERICAN ACADEMY OF PEDIATRICS, et ai.,
Intervenors.
Consolidated with 12-1101, 12-1102, 12-1147,
12-1172, 12-1173, 12-1174, 12-1175, 12-1176,
12-1177, 12-1178, 12-1180, 12-1181, 12-1182,
12-1183, 12-1184, 12-1185, 12-1186, 12-1187,
12-1188, 12-1189, 12-1190, 12-1191, 12-1192,
12-1193, 12-1194, 12-1195, 12-1196
December 10, 2013, Argued
April 15, 2014, Decided
On Petitions for Review of Final Rule of the
United States Environmental Protection Agency
COUNSEL: Lee B. Zeugin and Neil D. Gordon,
Assistant Attorney General, Office of the Attorney
2a
General for the State of Michigan, argued the causes
for State, Industry, and Labor Petitioners. With them
on the joint briefs were F. William Brownell, Lauren
E. Freeman, Elizabeth L. Horner, Bill Schuette,
Attorney General, Office of the Attorney General for
the State of Michigan, John J. Bursch, Solicitor
General, S. Peter Manning, Assistant Attorney
General, Luther Strange, Attorney General, Office of
the Attorney General for the State of Alabama,
Michael C. Geraghty, Attorney General, Office of
the Attorney General for the State of Alaska, Steven
E. Mulder, Attorney, Peter S. Glaser, George Y.
Sugiyama, Michael H. Higgins, David B. Rifkin, Jr.,
Lee A. Casey, Mark W. DeLaquil, Andrew M.
Grossman, David Flannery, Gale Lea Rubrecht,
Kathy G. Beckett, Edward L. Kropp, Leslie Sue Ritts,
Thomas Horne, Attorney General, Office of the
Attorney General for the State of Arizona, Joseph P.
Mikitish and James T. Skardon, Assistant Attorneys
General, Dustin McDaniel, Attorney General, Office
of the Attorney General for the State of Arkansas,
Kendra Akin Jones, Assistant Attorney General,
Charles L. Moulton, Senior Assistant Attorney
General, Pamela Jo Bondi, Attorney General, Office
of the Attorney General for the State of Florida,
Jonathan A. Glogau, Attorney, Lawrence G. Wasden,
Attorney General, Office of the Attorney General for
the State of Idaho, Grant Crandall, Arthur Traynor,
Ill, Eugene M. Trisko, Gregory F. Zoeller, Attorney
General, Office of the Attorney General for the State
of Indiana, Valerie Tachtiris, Deputy Attorney
General, Dennis Lane, Derek Schmidt, Attorney
General, Office of the Attorney General for the
State of Kansas, Jeffrey A. Chanay, Deputy Attorney
General, Henry V. Nickel, George P. Sibley III,
Eric A. Groten, Jeremy C. Marwell, John A. Riley,
3a
Christopher C. Thiele, Harold E. Pizzetta Il,
Assistant Attorney General, Office of the Attorney
General for the State of Mississippi, Chris Koster,
Attorney General, Office of the Attorney General for
the State of Missouri, James R. Layton and John J.
McManus, Attorneys, Paul D. Clement, Nathan A.
Sales, Lisa Marie Jaeger, Jon Bruning, Attorney
General, Office of the Attorney General for the State
of North Dakota, Margaret I. Olson, Steven C. Kohl,
Eugene E. Smary, Sarah C. Lindsey, E. Scott Pruitt,
Attorney General, Office of the Attorney General
for the State of Oklahoma, P. Clayton Eubanks,
Assistant Attorney General, Michael DeWine,
Attorney General, Office of the Attorney General for
the State of Ohio, Dale T. Vitale and Gregg H.
Bachmann, Assistant Attorneys General, Robert M.
for the Commonwealth of Virginia, Patrick Morrisey,
Attorney General, Office of the Attorney General for
the State of West Virginia, Silas B. Taylor, Senior
Deputy Attorney General, Jeffrey R. Holmstead,
Sandra Y. Snyder, Gregory A. Phillips, Attorney
General, Office of the Attorney General for the State
of Wyoming, Jay A. Jerde, Deputy Attorney General,
4a
Jack Conway, Attorney General, Office of the
Attorney General for the State of Kentucky, Bart E.
Cassidy, and Katherine L. Vaccaro.
Bill Cobb argued the cause for Industry Petitioners’
Specific Issues. With him on the briefs were Michael
Nasi, Leslie Sue Ritts, Jeffrey R. Holmstead, Sandra
Y. Snyder, Paul D. Clement, Nathan A. Sales, Steven
C. Koh!, Eugene E. Smary, Sarah C. Lindsay, Bart E.
Cassidy, Katherine L. Vaccaro, John C. Hayes, Jr.,
Dennis Lane, John A. Riley, Christopher C. Thiele, C.
Grady Moore, III, P. Stephen Gidiere, III, and
Thomas Lee Casey, III.
Sanjay Narayan and Eric Schaeffer argued the
causes for Environmental Petitioners. With them on
the briefs were Whitney Farrell, James S. Pew, Neil
Gormley, Ann Brewster Weeks, and Darin Schroeder.
David Bookbinder argued the cause and filed the
briefs for petitioner Julander Energy Company.
Michael B. Wigmore, Sandra P. Franco, Robin S.
Conrad, Rachel Brand, and Sheldon Gilbert were
on the brief for amicus curiae The Chamber of
Commerce of the United States of America in support
of Industry Petitioners.
Eric G. Hostetler, Matthew R. Oakes, and Amanda
S. Berman, Attorneys, U.S. Department of Justice,
argued the causes for respondent. With them on
the brief was Wendy L. Blake, Attorney, U.S.
Environmental Protection Agency.
Melissa Hoffer, Assistant Attorney General, Office
of the Attorney General for the Commonwealth of
Massachusetts, argued the cause for State and Local
Government Intervenors in support of Respondent.
With her on the brief were Martha Coakley, Attorney
5a
General, Office of the Attorney General for the State
of Massachusetts, Tracy Triplett and Carol A. Iancu,
Assistant Attorneys General, Kamala D. Harris,
Attorney General, Office of the Attorney General for
the State of California, Janill L. Richards, Supervis-
ing Deputy Attorney General, Susan L. Durbin,
Deputy Attorney General, Joseph R. Biden, [II],
Attorney General, Office of the Attorney General for
the State of Delaware, Valerie M. Satterfield, Deputy
Attorney General, Thomas L. Miller, Attorney
General, Office of the Attorney General for the State
of Iowa, David R. Sheridan, Assistant Attorney
General, George Jepsen, Attorney General, Office of
the Attorney General for the State of Connecticut,
Kimberly P. Massicotte and Matthew I. Levine,
Assistant Attorneys General, Lisa Madigan, Attorney
General, Office of the Attorney General for the State
of Illinois, Matthew J. Dunn and Gerald T. Karr,
Assistant Attorneys General, Douglas F. Gansler,
Attorney General, Office of the Attorney General for
the State of Maryland, Roberta R. James, Assistant
Attorney General, Michael A. Delaney, Attorney
General, Office of the Attorney General for the State
of New Hampshire, K. Allen Brooks, Senior Assistant
Attorney General, Janet T. Mills, Attorney General,
Office of the Attorney General for the State of Maine,
Gerald D. Reid, Assistant Attorney General, Lori
Swanson, Attorney General, Office of the Attorney
General for the State of Minnesota, Max Kieley,
Assistant Attorney General, Eric T. Schneiderman,
Attorney General, Office of the Attorney General for
the State of New York, Michael J. Myers and Kevin
P. Donovan, Assistant Attorneys General, Ellen F.
Rosenbaum, Attorney General, Office of the Attorney
General for the State of Oregon, Paul A. Garrahan,
Assistant Attorney-in-Charge, Gary K. King, Attorney
6a
General, Office of the Attorney General for the State
of New Mexico, Stephen R. Farris, Assistant Attorney
General, Roy Cooper, Attorney General, Office of the
Attorney General for the State of North Carolina,
James C. Gulick, Senior Deputy Attorney General, J.
Allen Jernigan, Marc Bernstein, and Amy L. Bircher,
Special Deputy Attorneys General, William H.
Sorrell, Attorney General, Office of the Attorney
General for the State of Vermont, Thea J. Schwartz,
Assistant Attorney General, George A. Nilson,
William R. Phelan, Jr., Peter F. Kilmartin, Attorney
General, Office of the Attorney General for the State
of Rhode Island, George S. Schultz, Special Assistant
Attorney General, Irvin B. Nathan, Attorney Gen-
eral, Office of the Attorney General for the District of
Columbia, Amy E. McDonnell, Deputy General
Counsel, Christopher King, Benna Ruth Solomon,
and Jeremy Toth.
Sean H. Donahue argued the cause for Public
Health, Environmental, and Environmental] Justice
Group Respondent Intervenors. With him on the brief
were Pamela A. Campos, Tomas Carbonell, Ann
Brewster Weeks, Darin T. Schroeder, James S. Pew,
Neil E. Gormley, Sanjay Narayan, John D. Walke,
and John Suttles. Vickie L. Patton entered an
appearance.
Brendan K. Collins argued the cause for Industry
Respondent Intervenors. With him on the brief were
Robert B. McKinstry Jr., Lorene L. Boudreau, and
Erik S. Jaffe.
Peter S. Glaser, George Y. Sugiyama, F. William
Brownell, Lauren E. Freeman, Lee B. Zeugin,
Elizabeth L. Horner, David B. Rivkin Jr., Lee A.
Casey, Mark W. DeLaquil, Andrew M. Grossman,
Jeremy C. Marwell, Eric A. Groton, Jeffrey R.
7a
Holmstead, and Sandra Y. Snyder were on the brief
for Industry Intervenors in response to Environ-
mental Petitioners. Henry V. Nickel entered an
appearance.
Peter S. Glaser, George Y. Sugiyama, Hahnah
Williams, F. William Brownell, Lauren E. Freeman,
Lee B. Zeugin, Elizabeth L. Horner, Jeremy C.
Marwell, Eric A. Groton, Jeffrey R. Holmstead,
Sandra Y. Snyder, Bill Cobb, Michael Nasi, David B.
Rivkin Jr., Lee A. Casey, Mark W. DeLaquil, and.
Andrew M. Grossman were on the brief for
Intervenor Respondents in Opposition to Brief of
Petitioner Julander Energy Company.
Wendy B. Jacobs, Adam Babich, and Michael A.
Livermore were on the brief for amici curiae Institute
for Policy Integrity, et al. in support of respondent.
JUDGES: Before: GARLAND, Chief Judge, and
ROGERS and KAVANAUGH, Circuit Judges.
KAVANAUGH, Circuit Judge, concurring in part and
dissenting in part.
OPINION
PER CURIAM: In 2012, the Environmental Protec-
tion Agency promulgated emission standards for a
number of listed hazardous air pollutants emitted by
coal- and oil-fired electric utility steam generating
units. See National Emission Standards for Hazard-
ous Air Pollutants From Coal- and Ojil-Fired Electric
Utility Steam Generating Units and Standards of
Performance for Fossil-Fuel-Fired Electric Utility,
Industrial-Commercial-Institutional, and Small In-
dustrial-Commercial-Institutional Steam Generating
* Parts I, I, and IV are written by Judge Rogers. Part ITI is
written by Judge Kavanaugh, as are his dissenting opinion in
Part 11.B.2 and his concurring opinion in Part IV.
8a
Units, Final Rule, 77 Fed. Reg. 9304 (Feb. 16, 2012).
In this complex case, we addre 3s the challenges to the
Final Rule by State, Industry, and Labor petitioners,
by Industry petitioners to specific aspects of the Final
Rule, by Environmental petitioners, and by Julander
Energy Company. For the following reasons, we deny
the petitions challenging the Final Rule.
I.
In 1970, Congress enacted § 112 of the Clean Air
Act, Pub. L. No. 91-604, § 4(a), 84 Stat. 1676, 1685
(1970), to reduce hazardous air pollutants (“HAPs”).
See Sierra Club v. EPA, 353 F.3d 976, 979, 359 U.S.
App. D.C. 251 (D.C. Cir. 2004); H. R. REP. No. 101-
490, at 150 (1990). The statute defined HAPs as “air
pollutant([s] . . . which in the judgment of the Admin-
istrator fof the Environmental Protection Agency
(“EPA”)] cause, or contribute to, air pollution which
may reasonably be anticipated to result in an
increase in mortality or an increase in serious irre-
versible, or incapacitating reversible, illness.”
§ 112(aX1), 84 Stat. at 1685. In its original form,
§ 112 required EPA to publish a list containing “each
hazardous air pollutant for which [it] intends to
establish an emission standard.” § 112(bX1)XA), 84
Stat. at 1685. EPA then was to promulgate, within
360 days, emission standards “provid[ing] an ample
margin of safety to protect the public health” for each
listed HAP, unless EPA found that a particular listed
substance was in fact not hazardous. § 112(bX1XB),
84 Stat. at 1685. Over the next eighteen years, EPA
listed only eight HAPs, established standards for only
seven, and as to these seven addressed only a limited
selection of possible pollution sources. See New Jersey
v. EPA, 517 F.3d 574, 578, 380 U.S. App. D.C. 134
(D.C. Cir. 2008); S. REP. NO. 101-228, at 131 (1989).
9a
To remedy the slow pace of EPA’s regulation of
HAPs, Congress amended the Clean Air Act in 1990,
see Pub. L. No. 101-549, 104 Stat. 2531 (1990)
(“CAA”), by eliminating much of EPA’s discretion in
the process. See New Jersey, 517 F.3d at 578. In the
amended § 112, Congress itself listed 189 HAPs that
were to be regulated, see CAA § 112(b), 42 U.S.C.
§ 7412(b), and directed EPA to publish a list of
“categories and subcategories” of “major sources” and
certain “area sources” that emit these pollutants,
CAA § 112(c), 42 U.S.C. $ 7412(c). Once listed, a
source category may only be delisted (with one
exception not relevant here) if EPA determines that
“no source” in that category emits HAPs in quantities
exceeding specified thresholds. CAA § 112(cX9\B), 42
U.S.C. § 7412(c)(9)(B). For each listed “category or
subcategory of major sources and area sources” of
HAPs, EPA must promulgate emission standards.
CAA § 112(dX1), 42 U.S.C. § 7412(d)(1). Section
112(d) provides, as relevant, that emission standards
shall require the maximum degree of reduction in
emissions of the hazardous air pollutants subject
to this section (including a prohibition on such
emissions, where achievable) that the Admin-
istrator, taking into consideration the cost of
achieving such emission reduction, and any non-
air quality health and environmental impacts
and energy requirements, determines is
achievable[.]
CAA § 112(d)(2), 42 U.S.C. § 7412(d)(2) (emphasis
added). For existing sources, these “maximum
achievable control technology” (“MACT”) standards
may not be less stringent — regardless of cost or oth-
er considerations — “than [] the average emission
limitation achieved by the best performing [] sources”
10a
in the relevant category or subcategory. CAA
§ 112(d)(3XA)(B), 42 U.S.C. § 7412(dX3)A)-(B); see
Nat'l Lime Ass’n v. EPA, 233 F.3d 625, 629, 344 U.S.
App. D.C. 97 (D.C. Cir. 2000). EPA refers to
minimum-stringency MACT standards as “floors.”
Standards more stringent than the floors, determined
pursuant to § 112(dX2), are called “beyond-the-floor”
limits.
For electric utility steam generating units
(“EGUs”), however, Congress directed that prior to
any listing EPA conduct a study of “the hazards to
public health reasonably anticipated to occur as a
result of [EGU HAP emissions) after imposition of
the requirements of this Chapter [i.e., Chapter 85 Air
Pollution Prevention and Control].” CAA § 112(nX1XA),
42 U.S.C. $ 7412(n)(I)(A) (emphasis added). The
results of this “Utility Study” were to be reported to
Congress within three years. Jd. Further, Congress
directed that:
The Administrator shall regulate [EGUs] under
this section, if the Administrator finds such
regulation is appropriate and necessary after
considering the results of the study required by
this subparagraph.
Id. (emphasis added). Congress also directed EPA to
conduct two other studies on mercury emissions: the
“Mercury Study” on “the rate and mass of such
emissions, the health and environmental effects of
such emissions, technologies which are available to
control such emissions, and the costs of such
technologies,” to be reported to Congress in four
years, and the National Institute of Environmental
Health Sciences “study to determine the threshold
level of mercury exposure below which adverse
human health effects are not expected to occur,” to be
lla
reported to Congress in three years. See CAA
§ 112(nX 1X A)-(C), 42 U.S.C. § 7412(mX1)A)-(C).
In December 2000, on the basis of the Utility Study
and other data subsequently gathered, EPA issued a
notice of regulatory finding “that regulation of HAP
emissions from coal-and oil-fired electric utility steam
generating units under section 112 of the CAA is
appropriate and necessary.” Regulatory Finding on
the Emissions of Hazardous Air Pollutants From
Electric Utility Steam Generating Units, 65 Fed. Reg.
79,825, 79,826 (Dec. 20, 2000) (“2000 Finding”). EPA
found that EGUs “are the largest source of mercury
emissions in the U.S.” and that “[mJercury is highly
toxic, persistent, and bioaccumulates in fo ‘1 chains.”
65 Fed. Reg. at 79,827. Specifically, “[mJercury emit-
ted from [EGUs]) .. . is transported through the
atmosphere and eventually deposits onto land or
water bodies” where it then changes into “a highly
toxic” substance called methylmercury. Jd. Methy]l-
mercury “biomagnifies in the aquatic food chain,” id..,
meaning that it becomes concentrated in the bodies of
predatory fish which absorb the methylmercury their
food sources contained. When humans eat these
contaminated fish, they also are exposed; the
methylmercury from the fish is absorbed into the
bloodstream and “distributed to all tissues including
the brain.” Jd. at 79,829. The risks are greatest for
women of childbearing age, EPA explained, because
methylmercury “readily passes .. . to the fetus and
fetal brain,” id., and “the developing fetus is most
sensitive to the effects of methylmercury,” id. at
79,827. Children born to women who were exposed to
methylmercury during pregnancy have exhibited
neurological abnormalities and developmental delays.
Id. at 79,829.
12a
EPA concluded that “the available information
indicate[d] that mercury emissions from {[EGUs].. .
are a threat to public health and the environment,”
notwithstanding “uncertainties regarding the extent
of the risks due to electric utility mercury emissions.”
Id. (emphasis added). EPA also identified several
other metal and acid gas emissions from EGUs that
were “of potential concern,” namely arsenic, chromium,
nickel, cadmium, dioxins, hydrogen chloride, and
hydrogen fluoride. Jd. EPA therefore determined that
it was “appropriate” to regulate coal-and oil-fired
EGUs under § 112 because of the health and
environmental hazards posed by mercury emissiuns
from EGUs, and the availability of a number of
control options to effectively reduce such emissions.
Id. at 79,830. EPA further determined that it was
“necessary” to regulate EGUs under § 112 because
implementation of other provisions of the CAA would
“not adequately address” the public health and
environmental hazards found. Jd. Therefore, EPA
added “coal- and oil-fired electric utility steam
generating units to the list of source categories under
section 112(c) of the CAA.” Id.
In 2005, EPA reversed its 2000 Finding and
removed coal-and oil-fired EGUs from the list of
source categories under § 112(c). See Revision of
December 2000 Regulatory Finding on the Emissions
of Hazardous Air Pollutants From Electric Utility
Steam Generating Units and the Removal of Coal-
and Oil-Fired Electric Utility Steam Generating Units
From the Section 112(c) List, 70 Fed. Reg. 15,994,
15,994 (Mar. 29, 2005) (“2005 Delisting Decision”).
This change was based on EPA’s revised interpreta-
tion of § 112(mX1XA) and, to some extent, on a
revised assessment of the results of the Utility Study.
EPA concluded that it lacked authority under
13a
§ 112(n)(1)(A) to regulate on the basis of non-health
hazards (e.g., environmental harms), and should
“focus solely” on the health effects directly attributa-
ble to EGU emissions, rather than on EGUs’
contribution to overall pollutant levels. Jd. at 15,998.
Further, EPA decided it could consider other relevant,
“situation-specific factors, including cost” that may
affect whether regulation under § 112 is “appropri-
ate.” Id. at 16,000-01. Critically, EPA determined
that it must make its “appropriate and necessary”
finding by reference to health hazards that will
remain “after imposition of the requirements of” the
CAA. Id. at 15,998 (emphasis added) (quoting CAA
§ 112(n)(1MA), 42 U.S.C. § 7412(n)(1XA)). EPA
interpreted these other “requirements” to include
“not only those requirements already imposed 4nd in
effect, but also those requirements that EPA
reasonably anticipates will be implemented” and
which “could either directly or indirectly result in
reductions of utility HAP emissions.” Jd. at 15,999.
Concluding that regulation under other provisions of
the CAA would adequately address EGU emissions of
mercury and other HAPs, EPA determined that
regulation under § 112 was neither “appropriate” nor
“necessary.” Id. at 16,002-08. In responding to
comments, EPA stated that if it were to regulate
EGU emissions, then it would regulate only those
substances for which it had made a _ specific
“appropriate and necessary” determination. States
and other groups petitioned for review and this court
vacated the 2005 Listing Decision, New Jersey, 517
F.3d at 583, holding that EPA’s attempt to reverse its
December 2000 listing decision was unlawful because
Congress had “unambiguously limit[ed] EPA’s discre-
tion to remove sources, including EGUs, from the
section 112(c)(1) list once they have been added to it.”
14a
In 2012, after notice and comment, EPA “con-
firm[ed]” its 2000 Finding that regulation of EGU
emissions under § 112 is “appropriate and necessary.”
Final Rule, 77 Fed. Reg. 9304, 9310-11. In the
proposed rule, EPA stated that “the December 2000
Finding was valid at the time it was made based on
the information available to the Agency at that time.”
Proposed Rule, 76 Fed. Reg. 24,976, 24,986, 24,994-
97 (May 3, 2011) (“NPRM”). Although of the view
that no further evidence was required to affirm the
2000 Finding, EPA had conducted additional quan-
titative and qualitative analyses “confirml[ing] that it
remains appropriate and necessary today to regulate
EGUs under CAA section 112.” Id. at 24,986; see id.
at 24,999-25,020. With respect to the term “appropri-
ate,” EPA explained that it was “changling}) the
position taken in 2005 that the appropriate fiu.ding
could not be based on environmental effects alone’;
“revisiting the 2005 interpretation that required the
Agency to consider HAP emissions from EGUs
without considering the cumulative impacts of all
sources of HAP emissions”; “revising the 2005
interpretation that required the Agency to evaluate
the hazards to public health after imposition of the
requirements of the CAA”; and “rejecting the 2005
interpretation that authorizes the Agency to consider
other factors (e.g., cost), even if the agency
determines that HAP emitted by EGUs pose a hazard
to public health (or the environment).” Jd. at 24,989.
With respect to the term “necessary,” EPA rejected as
“unreasonable” its interpretation in 2005 that
regulation under § 112 was “necessary” only if no
other provision in the CAA — whether implemented
or only anticipated — could “directly or indirectly”
reduce HAP emissions to acceptable levels. Id. at
24,992.
15a
EPA explained that it interpreted § 112(n)(1)A)
to require the Agency to find it appropriate to
regulate EGUs under CAA section 112 if the
Agency determines that the emissions of one or
more HAP emitted from EGUs pose an identified
or potential hazard to public health or the envi-
ronment at the time the finding is made. If the
Agency finds that it is appropriate to regulate, it
must find it necessary to regulate EGUs under
section 112 if the identified or potential hazards
to public health or the environment will not be
adequately addressed by the imposition of the
requirements of the CAA. Moreover, it may be
necessary to regulate utilities under section 112
for a number of other reasons, including, for
example, that section 112 standards will assure
permanent reductions in EGU HAP emissions,
which cannot be assured based on other
requirements of the CAA.
Id. at 24,987-88. EPA also affirmed that coal- and oil-
fired EGUs were properly listed as a source category
under § 112(c). See id. at 24,986. EPA adhered to
these interpretations in the Final Rule, 77 Fed. Reg.
at 9311. Accordingly, on February 16, 2012, EPA
promulgated emission standards for a number of
listed HAPs emitted by coal- and oil-fired EGUs. See
id. at 9487-93.
Several petitions for review challenge the Final
Rule. We first address, in Part II, the challenges of
the State, Industry, and Labor petitioners. In Part
Ill, we address Industry petitioners’ specific issues.
In Part IV.A, we address the challenges by the
Environmental petitioners, and in Part IV.B, Julander
Energy Company’s standing. In addressing the sub-
stantive challenges to the Final Rule, this court must
16a
determine under the CAA whether the Final Rule
was promulgated in a manner that was arbitrary or
capricious, an abuse of discretion, or otherwise not in
accordance with law. See CAA § 307(dxX9XA), 42
U.S.C. § 7607(dX9XA). “The ‘arbitrary and capricious’
standard deems the agency action presumptively
valid provided the action meets a minimum rational-
ity standard.” Sierra Club, 353 F.3d at 978-79
(quoting Natural Res. Def. Council v. EPA, 194 F.3d
130, 136, 338 U.S. App. D.C. 340 (D.C. Cir. 1999)).
That is, “{iJf EPA acted within its delegated stetutory
authority, considered all of the relevant factors, and
demonstrated a reasonable connection between the
facts on the record and its decision, we will uphold its
determination.” Ethyl Corp. v. EPA, 51 F.3d 1053,
1064, 311 U.S. App. D.C. 163 (D.C. Cir. 1995). The
court will show particular deference “where the
agencys decision rests on an evaluation of complex
scientific data within the agency’s technical expertise.”
Troy Corp. v. Browner, 120 F.3d 277, 283, 326 U.S.
App. D.C. 249 (D.C. Cir. 1997); see also Marsh v. Or.
Natural Res. Council, 490 U.S. 360, 377, 109 S. Ct.
1851, 104 L. Ed. 2d 377 (1989).
Il.
State, Industry, and Labor petitioners challenge
EPA’s interpretation and application of the “appro-
priate and necessary” requirement in § 112(n\1)(A).
A.
As a threshold matter, petitioners contend that the
2000 Finding was unlawful because EPA did not
allow notice and comment on the finding, did not
quantify the relevant mercury emissions and associ-
ated health risks, and did not describe “alternative
control strategies” as required under § 112(n\1)A).
17a
Because the December 2000 notice was “fundamen-
tally flawed,” they contend it “could have no legal
consequences” and “could not provide the basis for a
§ 112(c) listing decision.” State, Industry & Labor
Pet’rs’ Br. (hereinafter “SIL Br.”) 27-28. Without a
proper listing under § 112(c), they contend, EPA has
no authority to regulate EGUs under § 112(d).
The court need not decide whether EPA’s December
2000 “appropriate and necessary” finding was pro-
cedurally or substantively valid because EPA
reconsidered and “confirm[ed]” that determination in
the Final Rule. See NPRM, 76 Fed. Reg. at 24,977;
Final Rule, 77 Fed. Reg. at 9310-11, 9320. For the
reasons we will discuss, we hold that EPA’s finding in
the Final Rule was substantively and procedurally
valid, and consequently any purported defects in the
2000 Finding have been cured, rendering petitioners’
challenge to December 2000 “appropriate and
necessary” finding moot. Cf. Fund for Animals, Inc. v.
Hogan, 428 F.3d 1059, 1063-64, 368 U.S. App. D.C.
238 (D.C. Cir. 2005).
B.
s
The crux of petitioners’ challenge to the Final Rule
focuses on EPA’s interpretation of the phrase
“appropriate and necessary” in § 112(mX1XA), 42
U.S.C. § 7412(nX1XA). The context of this phrase is
as follows. In a special subsection on EGUs, Congress
first directed: “The Administrator shall perform a
study of the hazards to public health reasonably
anticipated to occur as a result of emissions by
electric utility steam generating units of pollutants
listed under subsection (f) after imposition of the
requirements of this Act.” CAA § 112(nX1XA), 42
U.S.C. § 7412(mX1A) (emphasis added). Congress
then directed: “The Administrator shall regulate
18a
electric utility steam generating units under this
section, if the Administrator finds such regulation is
appropriate and necessary after considering the
results of the study required by this subparagraph.”
Id. (emphasis added). Apart from the instruction to
“consider[] the results of the [Utility Study]” on
public health hazards from EGU emissions, the
statute offers no express guidance regarding what
factors EPA is required or permitted to consider in
deciding whether regulation under § 112 is
“appropriate and necessary.” Neither does it define
the words “appropriate” or “necessary.” See NPRM,
76 Fed. Reg. at 24,986; 2005 Listing Decision, 70 Fed.
Reg. at 15,997. Petitioners object to how EPA chose to
fill these gaps.
In matters of statutory interpretation, the court
applies the familiar two part test under Chevron
U.S.A., Inc. v. Natural Resources Defense Council,
Inc., 467 U.S. 837, 842-43, 104 S. Ct. 2778, 81 L. Ed.
2d 694 (1984). First, the court employs traditional
tools of statutory construction to determine de novo
“whether Congress has directly spoken to the precise
question at issue.” Jd. at 842, 843 n.9. If the court
“ascertains that Congress had an intention on the
precise question at issue,” id. at 843 n.9, “that is the
end of the matter” and the court “must give effect to
the unambiguously expressed intent of Congress,” id.
at 842-43. If, however, “the statute is silent or
ambiguous with respect to the specific issue,” the
court will uphold the agency’s interpretation so long
as it constitutes “a permissible construction of the
statute.” Jd. at 843. “In such case, a court may not
substitute its own construction of a statutory
provision for a reasonable interpretation made by the
administrator of an agency.” Id. at 844.
19a
To the extent petitioners’ challenge concerns EPA’s
change in interpretation from that in 2005, our
approach is the same because “[a]gency inconsistency
is not a basis for declining to analyze the agency’s
interpretation under the Chevron framework.” Nat’!
Cable & Telecomms. Ass’n v. Brand X Internet Servs.,
545 U.S. 967, 981, 125 S. Ct. 2688, 162 L. Ed. 2d 820
(2005). That is, “if the agency adequately explains the
reasons for a reversal of policy, change is not
invalidating, since the whole point of Chevron is to
leave the discretion provided by the ambiguities of a
statute with the implementing agency.” Id. (internal
quotation marks omitted). And while “[u] nexplained
inconsistency” may be “a reason for holding an inter-
pretation to be an arbitrary and capricious change
from agency practice,” id., our review of a change in
agency policy is no stricter than our review of an
initial agency action, see FCC v. Fox Television
Stations, Inc., 556 U.S. 502, 514-16, 129 S. Ct. 1800,
173 L. Ed. 2d 738 (2009). Thus, although an agency
may not “depart from a prior policy sub silentio or
simply disregard rules that are still on the books,”
the agency “need not demonstrate to a court’s
satisfaction that the reasons for the new policy are
better than the reasons for the old one.” Id. at 515.
Rather, “it suffices that the new policy is permissible
under the statute, that there are good reasons for it,
and that the agency believes it to be better.” Id.
1. Reliance on delisting criteria. In the Final Rule,
EPA concluded that it is “appropriate and necessary”
to regulate HAP emissions on the basis, inter alia,
that EGU emissions of certain HAPs pose a cancer
risk higher than the standard set forth in the
§ 112(c\(9) delisting criteria (i.e., greater than one in
a million for the most exposed individual). See Final
Rule, 77 Fed. Reg. at 9311: NPRM, 76 Fed. Reg. at
20a
24,998. Petitioners contend that by so doing EPA
wrongly conflated the delisting criteria with the
“appropriate and necessary” determination. “By
applying the delisting provisions of § 112(cX9) in
making the initial, pre-listing determination whether
it is ‘appropriate and necessary’ to regulate EGUs,
EPA has unlawfully imposed requirements on itself
the Congress chose not to impose at the listing stage.”
SIL Br. 35. They maintain that EPA’s approach
“would treat EGUs the same as all other major
source categories — as a category that must be listed
unless the delisting criteria are met.” Id.
EPA explained that it was relying upon the
delisting criteria to interpret an ambiguous term in
§ 112(n 1A), namely, “hazards to public health,” see
Final Rule, 77 Fed. Reg. at 9333-34; NPRM, 76 Fed.
Reg. at 24,992-93, because the phrase “hazards to
public health” is nowhere defined in the CAA. EPA
looked to the delisting criteria, which specify the risk
thresholds below which a source category need not be
regulated, as evidence of congressional judgment as
to what degree of risk constitutes a health hazard.
See id. EPA explained:
Although Congress provided no definition of
hazard to public health, section 112(cX9)(B) is
instructive. In that section, Congress set forth a
test for removing source categories from the
section 112(c) source category list. That test is
relevant because it reflects Congress’ view as to
the level of health effects associated with HAP
emissions that Congress thought warranted
continued regulation under section 112.
NPRM, 76 Fed. Reg. at 24,993 (emphasis added); see
Final Rule, 77 Fed. Reg. at 9333-34. EPA concluded
that it had discretion also to consider various other
2la
factors in evaluating hazards to public health,
including
the nature and severity of the health effects
associated with exposure to HAP emissions; the
degree of confidence in our knowledge of those
health effects; the size and characteristics of the
populations affected by exposures to HAP
emissions; [and] the magnitude and breadth of
the exposures and risks posed by HAP emissions
from a particular source category, including how
those exposures contribute to risk in populations
with additional exposures to HAP from other
sources[.]
NPRM, 76 Fed. Reg. at 24,992; see Final Rule, 77
Fed. Reg. at 9334.
EPA reasonably relied on the § 112(cX9) delisting
criteria to inform its interpretation of the undefined
statutory term “hazard to public health.” Congress
did not specify what types or levels of public health
risks should be deemed a “hazard” for purposes of
§ 112(nX1XA). By leaving this gap in the statute,
Congress delegated to EPA the authority to give
reasonable meaning to the term. Cf. Chevron, 467
U.S. at 843-44. EPA’s approach does not, as
petitioners contend, “treat EGUs the same as all
other major source categories.” SIL Br. 35. Other
major source categories must be listed unless the
delisting criteria are satisfied; EPA’s approach treats
EGUs quite differently. For EGUs, EPA reasonably
determined that it may look at a broad range of
factors — only one of which concerned the § 112(c)(9)
benchmark levels — in assessing the health hazards
posed by EGU HAPs. Nowhere does EPA state or
imply that the delisting criteria provide the sole basis
for determining whether it is “appropriate and
22a
necessary” to regulate EGUs under § 112. Because
EPA’s approach is based on a permissible construc-
tion of § 112(n\1)(A), it is entitled to deference and
must be upheld.
2. Costs of regulation. Noting that in 2005 EPA
construed § 112(nX1XA) to allow consideration of
costs in determining whether regulation of EGU HAP
emissions is “appropriate,” petitioners contend that
EPA’s new interpretation to “preclude consideration
of costs,” SIL Br. 42, “unreasonably constrains the
language of § 112(n)(1XA),” SIL Br. 39. They point to
the dictionary definition of “appropriate” and to the
differences between regulation of EGUs under
§ 112(n1)(A) and regulating other sources under
§ 112(c), and to this court’s precedent that “only
where there is ‘clear congressional intent to preclude
consideration of cost’ [do] we find agencies barred
from considering costs.” SIL Br. 40 (quoting Michigan
vp. EPA, 213 F.3d 663, 678, 341 U.S. App. D.C. 306
(D.C. Cir. 2000), cert. denied, 532 U.S. 904, 121 5. Ct.
1225, 149 L. Ed. 2d 135 (2001)). They contend that
EPA’s new interpretation “is also unlawful because it
eliminates the discretion that Congress intended
EPA to exercise after completing the Utility Study.”
SIL Br. 41. As they see it, if the statutory term
“appropriate” imposes any limit whatsoever, it must
at least limit regulation to “risks [that] are worth the
cost of elimination.” SIL Reply Br. 14 (quoting
Michigan v. EPA, 213 F.3d at 667 (addressing the
term “significant”)).
In the Final Rule, EPA stated that “it is reasonable
to make the listing decision, including the appropri-
ate determination, without considering costs.” Final
Rule, 77 Fed. Reg. at 9327. EPA reasoned that
§ 112(nX1XA) would have included an “express
23a
statutory requirement that the Agency consider costs
in making the appropriate determination” if Congress
wanted to require EPA to do so. Jd. EPA also noted
that “[tlo the extent [its] interpretation differs from
the one set forth in 2005,” it had “fully explained the
basis for such changes.” Jd. at 9323 (citing NPRM, 76
Fed. Reg. at 24,986-93). (Even in 2005, EPA noted
only that “[njothing precludes EPA from considering
costs in assessing whether regulation of [EGUs]
under section 112 is appropriate in light of all the
facts and circumstances presented.” 2005 Delisting
Decision, 70 Fed. Reg. at 16,001 n.19.) In responding
to comments reacting to its position that “the better
reading of the term ‘appropriate’ is that it does not
allow for the consideration of costs in assessing
whether hazards to public health or the environment
are reasonably anticipated to occur based on EGU
emissions,” NPRM, 76 Fed. Reg. at 24,989, EPA
observed that the dictionary definition of “appropri-
ate” does not require consideration of costs and that
commenters had failed to identify an express
statutory requirement to that effect. EPA also stated
that it was reasonable to decline to consider costs in
the absence of an express statutory requirement to do
so because Congress, in enacting § 112, was princi-
pally concerned with mitigating hazards to public
health and the environment from HAP emissions. See
Final Rule, 77 Fed. Reg. at 9327. Inasmuch as Congress
had treated the regulation of HAP emissions
differently in the 1990 Amendments because EPA
was not acting quickly enough, EPA concluded it was
reasonable to make a listing decision without
considering costs. See id.
On its face, § 112(nX1XA) neither requires EPA
to consider costs nor prohibits EPA from doing
so. Indeed, the word “costs” appears nowhere in
24a
subparagraph A. In the absence of any express
statutory instruction regarding costs, petitioners rely
on the dictionary definition of “appropriate” —
meaning “especially suitable or compatible” or
“suitable or proper in the circumstances” — to argue
that EPA was required “to take into account costs to
the nation’s electricity generators when deciding
whether to regulate EGUs.” SIL Br. 39 (citing
MERRIAM-WEBSTER’S ONLINE DICTIONARY; NEW
OXFORD AMERICAN DICTIONARY (2d ed. 2005)). Yet
these definitions, which do not mention costs, merely
underscore that the term “appropriate” is “open-ended,”
“ambiguous, and “inherently context-dependent.”
Sossamon v. Texas, 131 S. Ct. 1651, 1659, 179 L. Ed.
2d 700 (2011); cf: Nat7 Ass’n of Clean Air Agencies v.
EPA, 489 F.3d 1221, 1229, 376 U.S. App. D.C. 385
(D.C. Cir. 2007).
Even if the word “appropriate” might require cost
consideration in some contexts, such a reading of
“appropriate” is unwarranted here, where Congress
directed EPA’s attention to the conclusions of the
study regarding public health hazards from EGU
emissions. Throughout § 112, Congress mentioned
costs explicitly where it intended EPA to consider
them. Cf. CAA § 112(dX2), 112(dX8XAXi), 112(fK1XB),
112(fX2KA), 112(nX1\B), 112(sX2), 42 U.S.C.
§ 7412(d)(2), 7412(dX8XAMi), 7412(f(1)(B), 7412(f(2)
(A), 7412(nX 1B), 7412(sX2). Indeed, in the immedi-
ately following subparagraph of § 112(n), Congress
expressly required costs to be considered. CAA
§ 112(nX 1B), 42 U.S.C. § 7412(nX1\B). The contrast
with subparagraph A could not be more stark.
“Where Congress includes particular language in one
section of a statute but omits it in another section of
the same Act, it is generally presumed that Congress
acts intentionally . . . in the disparate inclusion or
25a
exclusion.” Russello v. United States, 464 U.S. 16, 23,
104 S. Ct. 296, 78 L. Ed. 2d 17 (1983) (alterations
omitted); cf. Catawba Cnty., N.C. v. EPA, 571 F.3d
20, 36, 387 U.S. App. D.C. 20 (D.C. Cir. 2009).
Petitioners offer no compelling reason why Congress,
by using only the broad term “appropriate,” would
have intended the same result — that costs be
considered — in § 112(nX1XA). The legislative history
the dissent claims “establishes” the point, Dissent at
13, consists of a Floor statement by a single
Congressman that at best is ambiguous.’ For these
reasons, we conclude that the statute does not evince
unambiguous congressional intent on the specific
issue of whether EPA was required to consider costs
in making its “appropriate and necessary” determina-
tion under § 112(n)(1)(A).
Turning to EPA’s approach, its position that
“nothing about the definition of [‘appropriate’]
compels a consideration of costs,” Final Rule, 77 Fed.
Reg. at 9327, is clearly permissible. In Whitman v.
American Trucking Ass’ns, 531 U.S. 457, 121 S. Ct.
903, 149 L. Ed. 2d 1 (2001), Justice Scalia, writing for
a unanimous Court, noted that the Supreme Court
has “refused to find implicit in ambiguous sections of
the CAA an authorization to consider costs that has
elsewhere, and so often, been expressly granted.” Jd.
at 467; see also Natural Res. Def. Council v. U.S.
EPA, 824 F.2d 1146, 1163-65, 263 U.S. App. D.C. 166
» See 1 A LEGISLATIVE HISTORY OF THE CLEAN AIR ACT
AMENDMENTS OF 1990, at 1416-17 (1993) (statement by Rep.
Oxley) (indicating that the provision authorizing regulation of
EGUs would “avoid{) the imposition of excessive and unneces-
sary costs” by ensuring that EPA can regulate “only if the stud-
ies described in section 112(n) clearly establish that emissions...
from such units cause a significant risk of serious adverse ef-
fects on public health”).
26a
(D.C. Cir. 1987) (en banc). EPA’s interpretation is
consistent with that instruction. Just as in Whitman,
EPA declines to find in an ambiguous section what in
so many other CAA sections Congress has mentioned
expressly. And even assuming Whitman might be
distinguished on grounds it concerned a different
provision of the CAA, the question remains only
whether EPA’s interpretation is permissible.
Petitioners cannot point to a single case in which this
court has required EPA to consider costs where the
CAA does not expressly so instruct. In Michigan v.
EPA, this court merely held that “the agency was free
to consider .. . costs” under CAA § 110(aX2XKD), 42
U.S.C. § 7410(aX2XD), as EPA had urged in that
case. 213 F.3d at 679 (emphasis added).
EPA’s interpretation is also consistent with the
purpose of the 1990 Amendments, which were aimed
at remedying “the slow pace of EPA’s regulation of
HAPs” following the initial passage of the CAA. New
Jersey, 517 F.3d at 578. To ensure that HAP
emissions would be reduced to at least minimally-
acceptable levels, Congress, among other things,
listed 189 HAP substances for regulation and
“restrict[ed] the opportunities for EPA and others to
intervene in the regulation of HAP sources.” Jd. The
overall purpose of the 1990 Amendments was to spur
EPA to action. Although Congress gave EGUs a
three-year pass when it instructed EPA to conduct a
further study before regulating EGUs, see CAA
§ 112(nX 1A), 42 U.S.C. § 7412(n\1XA), there is no
indication that Congress did not intend EPA to
regulate EGUs if and when their public health
hazards were confirmed by the study, as they were
here.
27a
Petitioners, and our dissenting colleague, suggest
that EPA’s interpretation is unreasonable because
the notion that Congress would have authorized EPA
to regulate without any consideration of regulatory
costs is implausible. But this argument rests on a
false premise. Here, as in Whitman, interpreting one
isolated provision not to require cost consideration
does not indicate that Congress was unconcerned
with costs altogether, because Congress accounted for
costs elsewhere in the statute. Section 112(d)(2)
expressly requires EPA to “tak[le] into consideration
the cost of achieving . . . emission reduction[s]” when
setting the level of regulation under § 112. CAA
§ 112(dX2), 42 U.S.C. § 7412(d\2). It is true that this
cost consideration requirement does not apply with
respect to MACT floors. Yet even for MACT floors,
costs are reflected to some extent because the floors
correspond (by definition) to standards that better-
performing EGUs have already achieved, presumably
in a cost efficient manner. See CAA § 112(dK3)AY, 42
U.S.C. § 7412(dX3A). Moreover, Industry respondent
intervenors point out that petitioners’ proposed
approach would lead to an improbable “all-or-
nothing” scheme in which EPA could “choose not to
regulate EGUs at all under Section 112 based on
cost, even though EPA could not consider cost to
justify a less stringent emission standard than the
MACT floor.” Indus. Resp’t Intvn’rs’ Br. 8.
Contrary to petitioners’ claims, the word “appropri-
ate” is not rendered meaningless unless interpreted
to include cost consideration. Petitioners contend that
§ 112(nX1XA) mandates a two-step inquiry: EPA
must “first identify ‘a health hazard’ from HAPs
emitted from EGUs, and then determine whether
regulation of that health hazard is ‘appropriate and
necessary.” SIL Br. 41 (emphasis added). If the
28a
existence of a health hazard automatically means
regulation is appropriate, they contend, then EPA
has unlawfully abdicated the exercise of discretion
Congress delegated to it. This argument, too, is
unpersuasive. First, the rulemaking record reflects
that EPA did not focus exclusively on health hazards
in considering whether regulation would be “appro-
priate”; EPA also considered “the availability of
controls to address HAP emissions from EGUs.”
NPRM, 76 Fed. Reg. at 24,989; see id. at 24,997; see
also Final Rule, 77 Fed. Reg. at 9311. The factual
premise of petitioners’ argument is therefore incorrect.
Second, even if EPA had focused exclusively on
health hazards, the word “appropriate” would still
have meaning in § 112(n\1A) because the provision
does not assume, as petitioners seem to suggest, that
EPA would in fact “identify ‘a health hazard” from
EGUs. SIL Br. 41. Rather, the statute directs EPA to
“perform a study of the hazards to public health
reasonably anticipated to occur” and then to “regulate
[EGUs] . . . if the Administrator finds such regulation
is appropriate and necessary after considering the
results of the study.” CAA § 112(mX1)A), 42 U.S.C.
§ 7412(nX1)(A) (emphasis added). At the time
Congress enacted the 1990 Amendments, it was
possible that the Utility Study would fail to identify
significant health hazards from EGU HAP emissions.
(Indeed, petitioner argue that it did fail to do so. See
SIL Br. 13, 48-54.) Therefore, EPA had to “consider]|]
the results of the study” in order to determine
whether regulation would be “appropriate” based on
its assessment of the existence and severity of such
health hazards. The term “appropriate” plainly plays
a role: it requires EPA to apply its judgment in
evaluating the results of the study.
29a
Basically, petitioners and our dissenting colleague
seek to impose a requirement that Congress did not.
What they ignore is that Congress sought, as a
threshold matter, to have EPA confirm the nature of
public health hazards from EGU emissions. That is
the clear focus of § 112(n)(1XA). After that, Congress
left it to the expertise and judgment of EPA whether
or not to regulate. For EPA to focus its “appropriate
and necessary” determination on factors relating to
public health hazards, and not industry’s objections
that emission controls are costly, properly puts the
horse before the cart, and not the other way around
as petitioners and our dissenting colleague urge.
Given Congress’s efforts in the 1990 Amendments to
promote regulation of hazardous pollutants, EPA’s
interpretation of § 112(nX1MA) appears consistent
with Congress’s intent. Recall that only EGUs’
hazardous emissions were relieved of regulation until
completion of a study, and once the study confirmed
the serious public health effects of hazardous pollu-
tants from EGUs, Congress gave no signal that the
matter should end if remediation would be costly.
Our dissenting colleague has written a powerful-
sounding dissent. It sounds powerful, however, only
because it elides the distinction between EPA’s initial
decision regarding whether to list EGUs as sources of
hazardous air pollutants, and its subsequent decision
regarding whether to issue stringent beyond-the-floor
standards for such sources. The dissent refers to both
together as the MACT “program.” Dissent at 3. But
the “program” in fact proceeds in two stages, as the
dissent acknowledges. It is only as to the first, listing
stage that EPA has determined it should not consider
costs. That stage leads only to the setting of the
statutory MACT floor which, as the dissent notes, is a
“minimum stringency level.” Jd. The second stage
30a
leads to beyond-the-floor standards, which are mor?
restrictive. When setting those, EPA does consider
costs.
The dissent contends that “(mleeting that [MACT]
floor will be prohibitively expensive, particularly for
many coal-fired utilities,” forcing them “out of
business.” Dissent at 10-11. But in the Final Rule
EPA rejected this contention, concluding that “the
estimated number of early retirements,” of EGUs
“that may result from this rule is .. . less than 2
percent of all U.S. coal-fired capacity” in 2015. Final
Rule, 77 Fed. Reg. at 9416; see also id. at 9408
(rejecting the claim that the Final Rule “will result in
substantial power plant retirements”). Petitioners
have not challenged that conclusion. Industry
respondent intervenors further observe _ that
continuing to exempt EGUs from HAP regulation
penalizes those plants that have made investments in
clean air technology, and that “[tJhe Rule merely
requires cwners of uncontrolled plants to install and
operate control technology already operating at their
competitors’ plants, both leveling the playing field
and improving health and the environment.” Indus.
Resp’t Intv’nrs’ Br. 7. The Final Rule, which, as the
dissent notes, EPA has calculated will cost $9.6
billion a year, includes the cost of both stages. EPA
also has concluded under Executive Order 13563 that
the annualized benefits are $37 to $90 billion. See
Final Rule, 77 Fed. Reg. at 9306. (The dissent questions
this conclusion, notwithstanding its promise that
agency cost-benefit analyses should be reviewed
deferentially.) That’s “billion with a b,” in the
dissent’s catchy phrase. Dissent at 1. In short, “the
benefits of this rule outweigh its costs by between 3
to l or 9 to 1.” Final Rule, 77 Fed. Reg. at 9306.
3la
As the agency noted, “[u]nder section 112(n)(1XA),
EPA is evaluating whether to regulate HAP
emissions from EGUs at all.” NPRM, 76 Fed. Reg. at
24,989 (emphasis added). And there was nothing
unreasonable about its conclusion that costs should
not be considered in determining “whether HAP
emissions from EGUs pose a hazard to public health
or the environment.” Jd. at 24,988; see id. at 24,990.
That is especially so when “Congress did not
authorize the consideration of costs in listing any
[other] source categories for regulation under section
112... [and] did not permit the consideration of costs
in evaluating whether a source category could be
delisted pursuant to the provisions of section
112(cX9).” Id. at 24,989. And while the dissent insists
on “the centrality of cost consideration to proper
regulatory decisionmaking,” Dissent at 6, Whitman
makes clear the Supreme Court believes that
Congress does not necessarily agree. Nor is Whitman
the only case in which courts have found that
Congress legislated in a way the dissent would find
irrational.”
2 See Am. Textile Mfrs. Inst. v. Donovan, 452 U.S. 490, 511-12,
101 S. Ct. 2478, 69 L. Ed. 2d 185 (1981) (holding that OSHA is
not required to conduct a cost-benefit analysis in promulgating a
standard under section 6(b)(5) of the Occupational Safety and
Health Act because “Congress uses specific language when
intending that an agency engage in cost-benefit analysis”);
Tenn. Valley Auth. v. Hill, 437 U.S. 153, 184, 98 S. Ct. 2279, 57
L. Ed. 2d 117 (1978) (“The plain intent of Congress in enacting
[the Endangered Species Act] was to halt and reverse the trend
towards species extinction, whatever the cost.”); Union Elec. Co.
v. EPA, 427 U.S. 246, 257-58, 96 S. Ct. 2518, 49 L. Ed. 2d 474
(1976) (holding that EPA may not consider claims of economic
infeasibility in evaluating a state requirement that primary
ambient air quality standards be met by a certain deadline);
Lead Indus. Ass’n v. EPA, 647 F.2d 1130, 1150, 208 U.S. App.
32a
Academic generalities, see Dissent at 6-8, do not
demonstrate that EPA could not reasonably proceed
as it did in interpreting congressional intent —
especially not generalities by academics who are
criticizing the Supreme Court for failing to read
congressional statutes as they do.* The same is true
of utterances by single Justices — especially a
separate statement by one Justice concurring in
Whitman and a question by another during oral
argument about a different statutory section. See
Dissent at 6-7. Nor do the different approaches of the
Bush and Obama Administrations on the role of costs
in implementing the CAA do more than demonstrate
that administrations may differ and can change
positions without legal jeopardy, so long as an
adequate explanation is provided as was done here.
See Chevron, 467 U.S. at 865-66. The question before
the court is not “Should EPA have considered costs
in making its threshold determination under
§ 112(n)(1XA)?” but rather “Was EPA required to do
so at that point in its regulatory evaluation?” EPA
has explained why it concluded costs were not part of
the “appropriate and necessary” determination, and
D.C. 1 (D.C. Cir. 1980) (“We are unable to discern here any con-
gressional intent to require, or even permit, [EPA] to consider
economic . . factors in promulgating air quality standards
funder the CAA].”).
3 See Cass R. Sunstein, Interpreting Statutes in the Regulato-
ry State, 103 HARV. L. REV. 405, 492-93 (1989) (criticizing Amer-
ican Textile Manufacturers Institute, 452 U.S. 490, 101 S. Ct.
2478, 69 L. Ed. 2d 185, for “contributing to the irrationality of
the Occupational Safety and Health Act” by “refusing to read
the statute” as the author would); Cass R. Sunstein, Cost-
Benefit Default Principles, 99 MICH. L. REV. 1651, 1671 (2001)
(same); Richard J. Pierce, Jr., The Appropriate Role of Costs in
Environmental Regulation, 54 ADMIN L. REV. 1237, 1253 (2002)
(criticizing the Whitman Court for relying on an “anti-cost canon”).
33a
given Congress’s choice to leave the factors entering
into that determination to EPA, petitioners, and our
dissenting colleague, fail to demonstrate that EPA’s
considered judgment about the factors to be
considered was unlawful as an impermissible and
unreasonable interpretation of § 112(n 1A). Congress
left to EPA “the accommodation of manifestly com-
peting interests,” id. at 865, and EPA did all that
Congress required of it. Exactly how and when EGU
emissions are to be regulated is a different question.
For these reasons, we hold that EPA reasonably
concluded it need not consider costs in making
its “appropriate and necessary” determination under
§ 112(nX 1A).
3. Environmental harms. Petitioners also contend
that EPA was constrained to consider only public
health hazards, not environmental or other harms, in
making its “appropriate and necessary” determina-
tion. In their view, § 112(n)(1MA) unambiguously
forecloses the consideration of non-health effects
because the statute requires EPA to make its “appro-
priate and necessary” determination after consider-
ing the results of the Utility Study, which is focused
exclusively on identifying “hazards to public health”
caused by EGU HAP emissions. See SIL Br. 44. Peti-
tioners insist that in 2005 EPA followed the health-
only approach.
EPA reasoned that “nothing in the statute suggests
that the [EPA] should ignore adverse environmental!
effects in determining whether to regulate EGUs
under section 112.” NPRM, 76 Fed. Reg. at 24,988;
see Final Rule, 77 Fed. Reg. at 9325. To the contrary,
EPA concluded that the purpose of the CAA and the
statute’s express instruction to assess environmental
effects in the Mercury Study suggest “it is reasonable
34a
to consider environmental effects in evaluating the
hazards posed by HAP emitted from EGUs.” NPRM,
76 Fed. Reg. at 24,988; see Final Rule, 77 Fed. Reg. at
9325. EPA explained in response to comments that
restricting it from considering environmental harms
would “incorrectly conflate{] the requirements for the
Utility Study with the requirement to regulate EGUs
under CAA section 112 if EPA determines it is
appropriate and necessary to do so.” Fina! Rule, 77
Fed. Reg. at 9325.
EPA did not err in considering environmental
effects alongside health effects for purposes of the
“appropriate and necessary” determination. Although
petitioners’ interpretation of § 112(nX1)A) is plausible,
the statute could also be read to treat consideration
of the Utility Study as a mere condition precedent to
the “appropriate and necessary” determination. EPA
has consistently adopted this latter interpretation,
including in 2005. See 2005 Delisting Decision, 70
Fed. Reg. at 16,002. In the absence of any limiting
text, and considering the context (including
§ 112(nX1XB)) and purpose of the CAA, EPA
reasonably concluded that it could consider environ-
mental harms in making its “appropriate and
necessary” determination. The court need not decide
whether environmental effects alone would allow
EPA to regulate EGUs under § 112, because EPA did
not base its determination solely on environmental
effects. As we explain, infra Part II.B.5, EPA’s
decision to list EGUs can be sustained on the basis of
its findings regarding health hazards posed by EGU
HAP emissions.
4. Cumulative impacts of HAP emissions. On the
grounds that § 112(n)(1XA) directs EPA to study
hazards reasonably anticipated to occur “as a result
35a
of EGU HAP emissions, petitioners contend that
EPA was required to base its “appropriate and
necessary’ determination on public health hazards
that occur exclusively due to EGU HAPs. Thus, they
contend, EPA erred in considering EGU HAP
emissions that merely “contribute to” or exacerbate
otherwise-occurring health hazards. Petitioners point
out that EPA’s interpretation conflicts with its
approach in 2005, when it read § 112(nX1)(A) to
authorize regulation only upon a showing that EGU
emissions alone would cause harm.
EPA explained that it could reasonably consider
the cumulative impacts of HAP emissions because
focusing on HAP emissions from EGUs alone
when making the appropriate finding ignores the
manner in which public health and _ the
environment are affected by air pollution. An
individual that suffers adverse health effects as
the result of the combined HAP emissions from
EGUs and other sources is harmed, irrespective
of whether HAP emissions from EGUs alone
would cause the harm.
NPRM, 76 Fed. Reg. at 24,988: see Final Rule, 77
Fed. Reg. at 9325. EPA acknowledged it was
departing from its 2005 approach, see NPRM, 76 Fed.
Reg. at 24,989, but justified the departure on grounds
that the 2005 approach had been “flawed” and “non-
scientific” to the extent that “EPA [had] incorrectly
determined that U.S. EGU emissions of [mercury] did
mot constitute a hazard to public health,” id. at
25,019; cf. Final Rule, 77 Fed. Reg. at 9322-23.
EPA’s interpretation in the Final Rule is entitled to
deference. Section 112(n1)(A)’s reference to hazards
occurring “as a result of’ EGU HAP emissions could
36a
connote hazards caused solely by EGU emissions, but
it could also connote hazards exacerbated by EGU
emissions. EPA’s commonsense approach to this
statutory ambiguity was well within the bounds of its
discretion, and it adequately explained its reversal
from 2005. Petitioners’ contention that EPA erred in
considering the effects of HAPs emitted by non-EGU
sources is therefore unavailing. In any event, EPA
concluded in the Mercury Study that “even if there
were no other sources of [mercury] exposure,
exposures associated with deposition attributable to
U.S. EGUs” would place the most susceptible popula-
tions above the methylmercury reference dose.
NPRM, 76 Fed. Reg. at 25,010. Thus, EPA did find,
as petitioners contend it was required to do, that
EGU emissions alone would cause health hazards.
5. Regulation under § 112(d). Petitioners contend
that even if it is “appropriate and necessary” to
regulate EGU HAP emissions, such regulation should
be effected under § 112(nX1XA) to the degree
appropriate and necessary — not under § 112(d)
through the imposition of MACT standards. They
maintain that regulation of EGU HAPs that do not
pose health hazards, or regulation at a level higher
than needed to eliminate such hazards, is not
regulation that is “appropriate and necessary.”
Petitioners contend that § 112(n\1)(A)’s instruction
to “regulate electric steam generating units under
this section” (emphasis added) — rather than “under
§ 112(d)” — evinces congressional intent that EGU
HAPs should be regulated differently than other
sources. SIL Br. 36.
EPA expressly considered and dismissed petitioners’
proposed interpretation. EPA concluded that the
phrase “under this section” presumptively refers to
37a
regulation under section 112, not to regulation under
subparagraph 112(n)(1MA). See Final Rule, 77 Fed.
Reg. at 9330; NPRM, 76 Fed. Reg. at 24,993. Thus,
the plain statutory language suggests “EGUs should
be regulated in the same manner as other categories
for which the statute requires regulation.” Final
Rule, 77 Fed. Reg. at 9330. EPA explained:
CAA section 112 establishes a mechanism to list
and regulate stationar; sources of HAP
emissions. Regulation under CAA section 112
generally requires listing under CAA section
112(c)f} [and] regulation under CAA section
112(d)[.] . . . A determination that EGUs should
be listed once the prerequisite appropriate and
necessary finding is made is wholly consistent
with the language of section 112(nX1XA), and
listed sources must be regulated under CAA
section 112(d).
Id.; see also id. at 9326.
EPA acted properly in regulating EGUs under
§ 112(d). Section 112(nX1\A) directs the Administrator
to “regulate electric steam generating units under
this section, if the Administrator finds such regulation
is appropriate and necessary.” CAA § 112(n)(1)(A), 42
U.S.C. § 7412(n1XA). EPA reasonably interprets the
phrase “under this section” to refer to the entirety of
section 112. See Desert Citizens Against Pollution v.
EPA, 699 F.3d 524, 527, 403 U.S. App. D.C. 55 (D.C.
Cir. 2012). Under section 112, the statutory
framework for regulating HAP sources appears in
§ 112(c), which covers listing, and § 112(d), which
covers standard-setting. See CAA § 112(c), 112(d), 42
U.S.C. § 7412(c), 7412(d). This court has previously
noted that “where Congress wished to exempt EGUs
from specific requirements of section 112, it said so
38a
explicitly.” New Jersey, 517 F.3d at 583. EPA
reasonably concluded that the framework set forth in
§ 112(c) and § 112(d) — rather than another, hypo-
thetical framework not elaborated in the statute —
provided the appropriate mechanism for regulating
EGUs under § 112 after the “appropriate and
necessary’ determination was made. Therefore,
EPA’s interpretation is entitled to deference and
must be upheld.
6. Regulation of all HAP emissions. In the Final
Rule, EPA claimed authority to promulgate standards
for all listed HAPs emitted by EGUs, not merely for
those HAPs it has expressly determined to cause
health or environmental hazards. See, e.g., 77 Fed.
Reg. at 9325-26. Petitioners challenge this approach,
maintaining that § 112(n\1XA) limits regulation to
those individual HAPs that are “appropriate and
necessary” to regulate. Petitioners also object that
EPA’s interpretation contradicts its 2005 rulemaking
when it supported a substance-by-substance approach
to regulation.
EPA explained its disagreement with petitioners’
proposed approach. First, EPA reiterated its view
that once an “appropriate and necessary” determina-
tion is properly made, “EGUs should be regulated
under section 112 in the same manner as other
categories for which the statute requires regulation.”
Final Rule, 77 Fed. Reg. at 9326. EPA then reasoned
that this court’s decision in National Lime, 233 F.3d
at 633, “requires [EPA] to regulate all HAP from
major sources of HAP emissions once a source
category is added to the list of categories under CAA
section 112(c).” Jd. (emphasis added). In other words,
EPA concluded that if EGUs are to be regulated in
the same manner as other source categories, then all
39a
HAPs emitted by EGUs should be subject to
regulation. See id.
EPA did not err by concluding that it may regulate
all HAP substances emitted by EGUs. In National
Lime, 233 F.3d at 633, this court considered whether
$ 112(dX1) permitted EPA “to set emission levels only
for those listed HAPs” that could be controlled with
existing technology. Concluding that EPA had a
“clear statutory obligation to set emission standards
for each listed HAP,” the court held that “the absence
of technology-based pollution control devices for HCl,
mercury, and total hydrocarbons did not excuse EPA
from setting emission standards for those pollutants.”
Id. at 634. Although petitioners attempt to distin-
guish National Lime on grounds that it concerned
“major sources” rather than EGUs, they have not
provided any compelling resson why EGUs should
hot be regulated the same way as other sources once
EPA has determined that regulation under § 112 is
“appropriate and necessary.” It also bears emphasis
that the plain text of § 112(n\1XA) directs the
Administrator to “regulate electric utility steam
generating units”—not to regulate their emissions, as
petitioners suggest. This source-based approach to
regulating EGU HAPs was affirmed in New Jersey,
517 F.3d at 582, which held that EGUs could not be
delisted without demonstrating that EGUs, as a
category, satisfied the delisting criteria set forth in
§ 112(cX9). The notion that EPA must “pick and
choose” among HAPs in order to regulate only those
substances it deems most harmful is at odds with the
court’s precedent.
' To the extent EPA’s interpretation differs from its
2005 approach, it adequately explained its decision.
See Final Rule, 77 Fed. Reg. at 9325-26. Although
40a
petitioners suggest otherwise, the 2005 Delisting
Decision did not address whether EPA could regulate
all listed EGU HAPs following an “appropriate and
necessary’ determination. Here, EPA offered a
reasoned explanation for its approach; no more is
required. See Fox Television Stations, 556 U.S. at
515; Nat? Cable & Telecomms. Ass’n, 545 U.S. at 981.
In view of the above, EPA’s conclusion that it may
regulate ail HAP emissions from EGUs must be
upheld.
Ii.
A.
Petitioners assert that even if EPA has correctly
interpreted § 112(nX1XA), the emission standards
that EPA promulgated in the Final Rule are flawed
in several respects.
1. Appropriate and necessary determination. Peti-
tioners first contend that the agency’s determination
that it was “appropriate and necessary” to regulate
EGUs is arbitrary and capricious. Consistent with
their position on the proper interpretation of
§ 112(mn\1XMA), petitioners take a HAP-by-HAP
approach to criticizing EPA’s Finding. But, as we
explained above, EPA reasonably interprets the CAA
as allowing it to regulate all EGU HAP emissions
pursuant to the usual MACT program once it makes
the threshold “appropriate and necessary” determina-
tion. The question then is whether EPA reasonably
found it appropriate and necessary to regulate EGUs
based on all the record evidence before it.
EPA’s “appropriate and necessary” determination
in 2000, and its reaffirmation of that determination
in 2012, are amply supported by EPA’s findings
4la
regarding the health effects of mercury exposure.
Mercury exposure has adverse effects on human
health, primarily through consumption of fish in
which mercury has bioaccumulated. See Final Rule,
77 Fed. Reg. at 9310. And EGUs are the largest
domestic source of mercury emissions. Jd. Petitioners
do not dispute these basic facts, but instead take
issue with whether EPA has sufficiently quantified
the contribution of EGU mercury emissions to overall
mercury exposure. Our case law makes clear,
however, that EPA is not obligated to conclusively
resolve every scientific uncertainty before it issues
regulation. See Coal. for Responsible Regulation v.
EPA, 684 F.3d 102, 121, 401 U.S. App. D.C. 306 (D.C.
Cir. 2012) (“If a statute is precautionary in nature
and designed to protect the public health, and the
relevant evidence is difficult to come by, uncertain, or
conflicting because it is on the frontiers of scientific
knowledge, EPA need not provide rigorous step-by-
step proof of cause and effect to support an endanger-
ment finding.”) (internal quotation marks omitted).
Instead, “[w]hen EPA evaluates scientific evidence in
its bailiwick, we ask only that it take the scientific
record into account in a rational manner.” Jd. at 122
(internal quotation marks omitted).
EPA did so here. As explained in the technical
support document (TSD) accompanying the Final
Rule, EPA determined that mercury emissions posed
a significant threat to public health based on an
analysis of women of child-bearing age who consumed
large amounts of freshwater fish. See Mercury TSD;
NPRM, 76 Fed. Reg. at 25,007; Final Rule, 77 Fed.
Reg. at 9311-17. The design of EPA’s TSD was
neither arbitrary nor capricious; the study was
reviewed by EPA’s independent Science Advisory
Board, which stated that it “support[ed] the overall
42a
design of and approach to the risk assessment” and
found “that it should provide an objective, reasonable,
and credible determination of the potential for a
public health hazard from mercury emitted from U.S.
EGUs.” SAB Letter to EPA Administrator Jackson at
2 (Sept. 29, 2011), EPA-SAB-11-017. In addition,
EPA revised the final TSD to address SAB’s remain-
ing concerns regarding EPA’s data collection practices.
See Final Rule, 77 Fed. Reg. at 9313-16.‘
Petitioners’ remaining objections center on the
change in EPA’s position between 2005 and 2012.
Although petitioners are correct that EPA weighed
certain pieces of evidence differently at different
times, the agency reasonably and adequately
explained its basis for changing its position on
whether mercury emissions posed a sufficient risk to
constitute a public health hazard. See EPA Br. 40;
NPRM, 76 Fed. Reg. at 25,019-20. EPA identified and
analyzed what it viewed as technical flaws in the sci-
entific analysis supporting the 2005 Delisting Deci-
sion, including a failure to evaluate the cumulative
health hazard from EGU emissions when combined
with other sources of mercury, NPRM, 76 Fed. Reg.
* For the reasons explained in UARG v. EPA, Nos. 12-1166,
12-1366, 12-1420, 744 F.3d 741, 2014 U.S. App. LEXIS 4468,
2014 WL 928230 (D.C. Cir. Mar. 11, 2014), we do not address
petitioners’ claims that SAB’s final report on the Mercury TSD
was submitted too late to allow public comment and that EPA
unreasonably refused SAB’s request to review the final TSD.
Petitioners did not raise those issues in comments, and recon-
sideration is still pending before the agency. Even if these
arguments had been properly presented to the agency, petition-
ers would have forfeited them by raising them only in a cursory
footnote in their opening brief before this court. See Hutchins v.
Dist. of Columbia, 188 F.3d 531, 539 n.3, 338 U.S. App. D.C. 11
(D.C. Cir. 1999) (en banc) (“We need not consider cursory argu-
ments made only in a footnote”).
43a
at 25,019, and health hazards from methylmercury
exposure above the reference dose, id. at 25,020.
Those explanations are sufficient to meet the agen-
cy’s burden. See Fox Television Stations, 556 U.S. at
514-16.
2. Major source classification. Petitioners contend
that in setting emission standards for EGUs, EPA
was required to distinguish between “major sources”
and “area sources.” As relevant here, major sources
are automatically subject to MACT controls, while
area sources may, in EPA’s discretion, be regulated
under alternative standards. See CAA § 112(a}1),
112(aX2), 112(dX5), 42 U.S.C. § 7412(aX1), 7412(aX2),
7412(d\5). Petitioners assert that EPA’s failure to
segregate the different types of sources fatally
compromises the Final Rule because the EGU
emission standards should have been based exclu-
sively on data from major source EGUs. But § 112(d)
does not require EPA to regulate EGUs as “major
sources” and “area sources”; it merely says that, if
EPA lists major and area sources, it must then regu-
late them according to the separate provisions. See
CAA § 112(dX1), 42 U.S.C. § 7412(d)(1).
EPA’s decision not to draw such a distinction here
is a reasonable one. As EPA emphasizes, distinguish-
ing between major source and area source EGUs runs
counter to the separate statutory provisions governing
EGUs. While other sources are classified as major or
area sources depending on the quantity of emissions
they emit, § 112 specifically defines EGUs in terms of
their electrical output. Compare CAA § 112(aX8),
with CAA § 112(a)(i)(2). Consistent with ordinary
rules of statutory construction, EPA reasonably
relied on the more specific definition im § 112(aX8)
rather than the general definitions applicable to all
44a
other sources. See RadLAX Gateway Hotel, LLC uv.
Amalgamated Bank, 132 S. Ct. 2065, 2070-72, 182 L.
Ed. 2d 967 (2012). Requiring EPA to classify EGUs as
major or area sources would also create redundancy
in the source-category listing criteria. Section
112(c\3) of the CAA requires EPA to list area sources
for regulation if EPA determines that they “warrant|]
regulation.” CAA § 112(cX3), 42 U.S.C. § 7412(cX3).
That finding is arguably unnecessary as applied to
EGUs given the requirement in § 112(n\1)(A) that
EPA make a finding that regulation of all EGUs is
“appropriate and necessary.”
EPA also did not err in declining to exercise its
discretionary authority to require less stringent
“generally available control technology,” or GACT,
standards, rather than MACT standards. /d.
§ 112(dX5), 42 U.S.C. § 7412(d)(5). In the Final Rule,
EPA expressly and reasonably determined that
setting separate GACT standards for area source
EGUs was unnecessary. See Final Rule, 77 Fed. Reg.
at 9404, 9438 (“[S]imilar HAP emissions and contro!
technologies are found on both major and area
sources” such that “there is no essential difference
between area source and major source EGUs with
respect to emissions of HAP.”).
For these reasons, EPA reasonably declined to
interpret § 112 as mandating classification of EGUs
as major sources and area sources.
3. Mercury MACT floor. Petitioners next challenge
EPA’s standards for mercury emissions from existing
coal-fired EGUs. Petitioners maintain that in calcu-
lating the MACT floor for those units, EPA collected
emissions data from only those EGUs that were best-
performing for mercury emissions. Consequently,
petitioners insist, the mercury MACT standard
45a
reflects the results achieved by the “best of the best”
EGUs, and not the results of the best 12% of all
EGUs, as required by statute.
Petitioners’ assertions of a biased or irrational data
collection process are not supported by a review of
the record. “EPA typically has wide latitude in
determining the extent of data-gathering necessary
to solve a problem.” Sierra Club v. EPA, 167 F.3d
658, 662, 334 U.S. App. D.C. 421 (D.C. Cir. 1999).
Here, EPA determined that a three-pronged approach
was appropriate for developing the mercury MACT
standard. First, EPA asked all EGUs for ali of their
data from 2005-10; it received data from 168 units.
Information Collection Request (“ICR”) Supporting
Statement Part A at 9; see generally MACT Floor
Analysis Spreadsheets. Second, EPA requested and
received data from 50 randomly selected EGUs. ICR
Supporting Statement Part B at 2, 7-8. Finally, EPA
requested and received data from 170 of the best-
performing units for non-mercury emissions. Jd. EPA
initially thought that third group would also be the
best-performing for mercury emissions, but it
discovered that was not the case after examining the
data. See Responses to Comments, Dec. 2011, v.1, at
573-76 (“RTC”).
Based on the results of its ICR, covering a total of
388 EGUs, EPA chose “the average emission limita-
tion achieved by the best performing 12 percent” of
all existing sources “for which [it) hald) emissions
information,” as authorized by CAA § 112(dK3)A).
See NPRM, 76 Fed. Reg. at 25,022-23. Although, as
EPA acknowledges, it would be arbitrary and
capricious for EPA to set a MACT floor based on
intentionally skewed data, the facts indicate that
EPA did not do so here. Nor does the record suggest
46a
that EPA’s data collection efforts resulted in uninten-
tional bias. As previously noted, EPA collected data
from a wide range of EGUs because the agency
concluded that it could not identify units represent-
ing the best-performing 12 percent of mercury
emitters. That conclusion is borne out by the data in
the record, which showed that some of the best-
performing units for particulate matter control were
among the worst performing units for mercury
control. See generally MACT Floor Analysis
Spreadsheets. Similarly, many of the mercury best
performers (32 of the best performing 126 units) were
not drawn from the pool of units that EPA targeted
as best performers for particulate matter. See RTC v.
1 at 575. In short, EPA’s data-collection process was
reasonable, even if it may not have resulted in a
perfect dataset.
4. Acid gas HAP. EPA did not conclusively determine
that emissions of acid gases such as hydrogen
chloride from EGUs pose a health hazard. See
NPRM, 76 Fed. Reg. at 25,016 (“our case studies did
not identify significant chronic non-cancer risks from
acid gas emissions”). Petitioners say that given that
conclusion, EPA should have established a less
stringent, health-based emission standard for acid
gases under § 112(d)(4). That provision states: “With
respect to pollutants for which a health threshold has
been established, the Administrator may consider
such threshold level, with an ample margin of safety,
when establishing emission standards under this
subsection.” CAA § 112(d\4), 42 U.S.C. § 7412(d)(4).
Section 112(d\4) makes clear, however, that EPA’s
authority to set alternate standards is discretionary.
See id. (“the Administrator may consider such thresh-
old level”) (emphasis added). Here, EPA concluded
that it lacked enough evidence to determine whether
Alva
an alternative standard would protect health “with
an ample margin of safety.” See Final Rule, 77 Fed.
Reg. at 9405-06. Petitioners dispute EPA’s weighing
of the evidence, but petitioners offer no compelling
basis for second-guessing EPA’s analysis.
Petitioners also suggest that regulation of EGU
acid gas emissions to address ecosystem acidification
conflicts with Congress’s decision in the 1990 CAA
amendments to address such acidification in Title IV
of the CAA. See SIL Reply Br. 5. But petitioners
failed to raise that argument before the agency, and
did not raise it in this court until their reply brief. We
therefore deem the argument forfeited. See Bd. of
Regents of Univ. of Washington v. EPA, 86 F.3d 1214,
1221, 318 U.S. App. D.C. 220 (D.C. Cir. 1996).
5. UARG delisting petition. The Utility Air Regula-
tory Group (UARG) filed a petition with EPA seeking
to remove coal-fired EGUs from the list of sources
regulated under § 112. EPA denied the petition.
Petitioners now argue that that denial was arbitrary
and capricious for the same reasons they assert that
the agency’s determination that it is “appropriate and
necessary” to regulate EGUs was incorrect. Assum-
ing, without deciding, that EPA can delist only a sub-
set of the EGU source category, we reject petitioners’
argument on this point. As EPA explained in the
Final Rule, UARG’s delisting petition did not demon-
strate that EPA could make either of the two
predicate findings required for delisting under
§ 112(cX9XB): (1) that no source in the category emits
HAP “in quantities which may cause a lifetime risk of
cancer greater than one in one million to the
individual in the population who is most exposed”
and (2) that emissions from no source in the category
“exceed a level which is adequate to protect public
48a
health with an ample margin of safety.” CAA
§ 112(cX9\B), 42 U.S.C. § 7412(cX9XB); see also Final
Rule, 77 Fed. Reg. at 9364-65 (discussing technical
flaws in UARG’s risk analysis).
6. Chromium emissions data. Finally, petitioners
question the validity of EPA’s case study regarding
risks from non-mercury EGU emissions. As relevant
here, that study found that at 6 of 16 tested facilities,
emissions of HAP posed a lifetime cancer risk of more
than one in a million to the most exposed individuals.
See Final Rule, 77 Fed. Reg. at 9319. Petitioners
contend that EPA’s cancer-risk finding was the
product of contaminated emissions samples, and that
EPA has refused to correct the emissions data it
used. In making this argument, they rely on their
own independent “subsequent resampling” of the
facilities that EPA examined in conducting its
inhalation risk assessment. SIL Br. 52 n.58; UARG,
Petition for Reconsideration of MATS Rule at 6-7
(Apr. 16, 2012), EPA-HQ-OAR-2009-0234-20179 (J.A.
2493-94).
EPA did not act arbitrarily or capriciously in rely-
ing on the chromium emissions data to which peti-
tioners object. As EPA explained in its responses to
comments, the data came from source representa-
tives themselves. RTC v.1 at 187. EPA reasonably
believed that these representatives — given their
“concern{] about data accuracy” — would review “all
data before certifying their accuracy and submitting
them to the EPA.” Jd. EPA did not err in relying on
this certified data. We cannot consider the data from
petitioners’ independent resampling, which was con-
ducted after the Final Rule issued and was not part
of the administrative record. See CAA § 307(d)(7A),
42 U.S.C. § 7607(d)(7)(A).
49a
B.
A group of electric utilities and industry groups
nave filed a separate petition raising issues specific
to industry. Many of industry petitioners’ arguments
concern circulating fluidized bed EGUs, or CFBs. As
relevant here, CFBs differ from conventional pulver-
ized coal units in that CFBs inject air and additional
materials, such as limestone, into the combustion
zone in order to achieve lower-temperature combus-
tion. At that lower temperature, fuel breaks down to
& lesser degree, thus enabling CFBs to control emis-
sions without using add-on controls.
Industry petitioners argue that these design
differences required EPA to create a separately
regulated subcategory for CFBs. They emphasize
that EPA recognized the need for a CFB subcategory
in a different rulemaking proceeding, the “Boiler
MACT” Rule.
Industry petitioners’ CFB-related arguments are
unavailing. Contrary to industry petitioners’ asser-
tions, nothing in the Clean Air Act “requires” EPA to
create a CFB subcategory. Rather, the statute gives
EPA substantial discretion in determining whether
subcategorization is appropriate. See CAA § 112(d\ 1),
42 U.S.C. § 7412(d)(1) (EPA “may distinguish among
classes, types, and sizes of sources”) (emphasis
added); see also Nat'l Ass’n of Clean Water Agencies v.
EPA, 734 F.3d 1115, 1159 (D.C. Cir. 2013) (“EPA’s
subcategorization authority under § 112 involves an
expert determination, placing a heavy burden on a
challenger to overcome deference to EPA’s articulated
Tational connection between the facts found and the
thoice made.”) (internal quotation marks omitted).
EPA’s decision not to create a CFB subcategory in the
Final Rule is reasonable and well-supported by the
50a
record. Among other things, EPA noted that CFBs
were among the best and worst performers for
various pollutants, indicating that CFBs have
emissions profiles similar to other coal-fired units
despite their operational differences. See Final Rule,
77 Fed. Reg. at 9397.
The record similarly supports EPA’s determination
that the 0.002 Ib/MMBtu hydrogen chloride limit for
CFBs is achievable. As noted above, some CFB units
were among the top performers for each of the
regulated pollutants, including hydrogen chloride.
See id. The record thus demonstrates that at least
some CFB units are in fact able to achieve the
hydrogen chloride limit. In any event, the fact that
the Final Rule may not be cost effective for all CFBs
does not necessarily mean EPA erred in declining to
create a CFB subcategory or in setting emission
standards applicable to those units.
EPA’s decision to subcategorize CFBs in the Boiler
MACT Rule is not to the contrary. There, EPA
concluded that CFBs presented relevant differences
with respect to carbon monoxide — not mercury, acid
gases, or particulates (the pollutants at issue in this
rulemaking). See National Emission Standards for
Hazardous Air Pollutants for Major Sources: Indus-
trial, Commercial, and Institutional Boilers and
Process Heaters, 76 Fed. Reg. 15,608, 15,617-18 (Mar.
21, 2011).
Industry petitioners furthes argue that at a
minimum, EPA should have set separate acid gas
standards for coal-refuse-fired CFBs. Those units
burn waste coal from other coal-mining operations
and use the resulting ashes in mine reclamation
projects. Industry petitioners maintain that these
fuel-ash reuse efforts would be imperiled by the
5la
stringency of the acid gas standards in the Final
Rule.
We conclude that EPA reasonably decided that
separate standards for coal-refuse-fired CFBs were
not warranted. Industry petitioners’ assertion that
the hydrogen chloride standards are unattainable for
coal-refuse-fired CFBs is undermined by the fact that
some of those units were among the best performers
for hydrogen chloride. See RTC v.1 at 587. FPA also
suggested alternative compliance methods that it
says would permit coal-refuse-fired CFBs to continue
participating in reclamation efforts. See Final Rule,
77 Fed. Reg. at 9412. Regardless, nothing in the CAA
obligates EPA to set standards in a way that always
allows the re-use of fuel ash, even if doing so might
be a more desirable outcome for some EGU operators.
C.
In contrast to its decision on CFBs, EPA did create
a subcategory for lignite-fired EGUs. (Lignite coal is
also referred to as “low rank” coal due to its low heat
content.) Industry petitioners argue that the emission
standard for the lignite subcategory is based on an
improperly calculated minimum stringency level, or
MACT floor. Industry petitioners also contend that
the emission standard set by EPA is not achievable.
We consider these arguments in turn.
1. MACT floor. Industry petitioners insist that EPA
incorrectly calculated the MACT floor for lignite
units, rendering that standard arbitrary and capri-
cious. They assert that EPA used “cherry picked”
data from the top 6% of units, instead of the top 12%
as required by § 112(dX3A). Finally, industry peti-
tioners argue that EPA did not properly account for
variability in lignite coal.
52a
Industry petitioners’ data-bias argument is similar
to the argument made by the State, Industry & Labor
petitioners regarding the mercury MACT floor, supra
Part [J.A.3. And, as with that argument, petitioners’
assertions regarding the lignite MACT floor find no
support in the record. EPA has offered a reasonable,
non-biased explanation of its data-collection and
analysis process. See MACT Floor Memo at 10; RTC
v.1 at 559-60.
Industry petitioners’ objections regarding the vari-
ability of lignite coal likewise fail. EPA accounted for
variability due to differing chemical compositions of
coal by applying its Upper Prediction Limit analysis.
See NPRM, 76 Fed. Reg. at 25,041. Industry petition-
ers do not challenge that analysis itself. They do
suggest in passing that EPA’s results are flawed, see
Industry Pet’rs’ Br. 10, but offer no explanation as to
why that is so. Such cursory treatment is inadequate
to place their challenge to EPA’s variability analysis
before the court, because “it is not enough merely to
mention a possible argument in the most skeletal
way, leaving the court to do counsel’s work, create
the ossature for the argument, and put flesh on its
bones.” Davis v. Pension Benefit Guar. Corp., 734
F.3d 1161, 1166-67 (D.C. Cir. 2013) (internal quota-
tion marks and alterations omitted). While EPA
acknowledged that it could not account for all opera-
tional variability, it concluded that its variability
analysis “is an appropriate method of addressing the
concern that these standards must be met at all
times.” RTC v.1 at 458. EPA’s explanation is suffi-
cient to withstand our “extremely deferential” review
of this kind of technical judgment. New York v. Reilly,
969 F.2d 1147, 1152, 297 U.S. App. D.C. 147 (D.C.
Cir. 1992).
53a
2. Beyond-the-floor limit. EPA is permitted to set a
more restrictive, “beyond-the-floor” emission standard
if the agency determines that such a standard is
“achievable” considering costs, energy requirements,
and applicable control technologies. CAA § 112(dX2),
42 U.S.C. § 7412(dX2). To be “achievable,” a standard
“must be capable of being met under most adverse
conditions which can reasonably be expected to
recur.” Nat? Lime Ass’n v. EPA, 627 F.2d 416, 431
n.46, 200 U.S. App. D.C. 363 (D.C. Cir. 1980). In this
case, industry petitioners argue that EPA failed to
consider the limitations of applicable control technol-
ogies. As a result, petitioners contend, EPA’s beyond-
the-floor standard for lignite-fired EGUs is not
achievable because the standard mandates unreal-
istically high levels of mercury reduction.
We reject petitioners’ challenge to the beyond-the-
floor standard. EPA concluded during the rulemaking
process that the standard for lignite units is achieva-
ble if sources increase their use of a particular control
technology, activated carbon injection. See Beyond-
the-Floor Memo at 1-4. According to EPA, increased
carbon injection can reduce emissions by up to 90%,
well in excess of the reductions necessary to reach
beyond-the-floor levels. Jd. at 1-2. Ultimately, the
dispute on this issue amounts to a factual disagree-
ment between EPA and petitioners over the effec-
tiveness of activated carbon injection. Because the
record contains no data inconsistent with EPA’s posi-
tion on the efficacy of activated carbon injection, we
defer to the agency’s determination that the beyond-
the-floor emission standard for lignite-fired EGUs is
achievable.
54a
D.
Public utility companies are subject to certain
state-law contracting requirements that may
lengthen the process of installing upgraded controls.
That added time, industry petitioners argue, requires
EPA to grant a blanket, one-year extension of the
compliance deadline to public power companies. We
disagree. Once again, petitioners’ argument amounts
to a claim that a decision the Clean Air Act leaves to
EPA’s discretion should instead be mandatory. See
CAA § 112(iX3)(B), 42 U.S.C. § 7412GX3XB) (EPA
“may issue” an extension under certain circum-
stances). EPA explained at length why such a blanket
extension was inappropriate. See Final Rule, 77 Fed.
Reg. at 9407, 9409-11. Most importantly, industry
petitioners did not show — and likely could not
show — that an extension is necessary for the instal-
lation of controls at every public power company. On
the contrary, EPA’s data indicated that “most units
will be able to fully comply” within the three-year
period established by EPA. Final Rule, 77 Fed. Reg.
at 9410. EPA’s decision not to issue a blanket
extension therefore was not arbitrary or capricious.”
5 To the extent that petitioners object to EPA’s alleged failure
to respond to comments on this issue made by public power
companies on the ground that this failure violates CAA
§ 307(d6XB), 42 U.S.C. § 7607(dX6XB), we do not address that
objection because it was first raised in a pending petition for
reconsideration. See UARG, 2014 U.S. App. LEXIS 4468, 2014
WL 928230, at *4. We also do not address industry petitioners’
arguments concerning the standards for petroleum-coke-fired
EGUs and liquid oil-fired non-continental EGUs because those
arguments were likewise first raised in a pending petition for
reconsideration.
55a
IV.
We turn to the challenges by Environmental
petitioners and Julander Energy Company.
A.
Environmental petitioners challenge the provisions
of the Final Rule that allow compliance with emission
standards to be demonstrated through (1) emissions
averaging and (2) options for non-mercury metal HAP
emissions monitoring. Chesapeake Climate Action
Network, Conservation Law Foundation, Environ-
mental Integrity Project, and Sierra Club object to
averaging as unlawful; Chesapeake Climate Action
Network and Environmental Integrity Project object
to the monitoring options as failing to provide
reasonable assurance of compliance. They presented
their objections (save one) during the comment period
and EPA has responded to them. Although the
challenges to emissions averaging are also pending
before EPA in a petition for reconsideration, and
usually would be incurably premature, see, e.g.,
Clifton Power Corp. v. FERC, 294 F.3d 108, 112, 352
U.S. App. D.C. 310 (D.C. Cir. 2002), the text and
legislative history of the Clean Air Act make clear
this usual approach is inapplicable, see UARG v.
EPA, Nos. 12-1166, 12-1366, 12-1420, 744 F.3d 741,
2014 U.S. App. LEXIS 4468, 2014 WL 928230, at *3
(D.C. Cir. Mar. 11, 2014); CAA § 307(bX1), 42 U.S.C.
§ 7607(b)(1); S. REP. NO. 101-228, at 3755 (1989).
1. Averaging. Under the Final Rule, existing con-
tiguous, commonly-controlled EGUs in the same sub-
category can demonstrate compliance by averaging
their emissions as an alternative to meeting certain
requirements on an individual basis. Final Rule, 77
Fed. Reg. at 9384, 9473-76 (codified at 40 C.F.R.
56a
§ 63.10009). Averaging is permissible only between
the same types of pollutants, individual EGUs that
are part of the same affected source, EGUs subject to
the same emission standard, and existing (not new)
EGUs. Id. at 9385. Each facility intending to use
emissions averaging must develop an emissions
averaging plan identifying “(1) [ajll units in the aver-
aging group; (2) the control technology installed; (3)
the process parameter that will be monitored; (4) the
specific control technology or pollution prevention
measure to be used; (5) the test plan for the meas-
urement of the HAP being averaged; and (6) the
operating parameters to be monitored.” Jd. at 9385-
86.
Environmental petitioners contend the averaging
alternative is unlawful because it relaxes the
stringency of the MACT floor standards. With one
exception, EPA set the MACT floor standards based
on a thirty-boiler operating day averaging period. Id.
at 9385, 9479-80. Allowing multiple EGUs to average
their emissions data effectively extends, petitioners
maintain, the standards’ averaging period to sixty
days (for two units), ninety days (for three units), or
more. In their view, a longer averaging period
permits longer and larger pollution spikes because
high measurements can be averaged over more hours
of normal, lower-pollution operations.
Section 112(dX3), 42 U.S.C. § 7412(dX3), provides
that emission standards for existing sources “shall
not be less stringent” than “the average emission lim-
itation achieved by the best performing 12 percent” of
such sources. The subsection (d)(2) “beyond-the-floor”
requirement provides that emission standards for
new or existing sources “shall require the maximum
degree of reduction in emissions of the hazardous
57a
air pollutants subject to this section .. . that the
Administrator . . determines is achievable.” CAA
§ 112(dX2), 42 U.S.C. § 7412(d)(2).
EPA permissibly interpreted § 112(d) to allow
emissions averaging as provided for in the Final
Rule. See Chevron, 467 U.S. at 843. That section
fheither expressly allows nor disallows emissions
dveraging among multiple units. In the Final Rule,
EPA stated:
Averaging across affected units is permitted only
if it can be demonstrated that the total quantity
of any particular HAP that may be emitted by
that portion of a contiguous major source that is
subject to the same standards in the [Final Rule}
will not be greater under the averaging
mechanism than it could be if each individual
affected EGU in the subcategory complied
separately with the applicable standard. Under
this test, the practical outcome of averaging is
equivalent to compliance with the MACT floor
limits by each discrete EGU, and the statutory
requirement that the MACT standard reflect the
maximum achievable emissions reductions is,
therefore, fully effectuated.
77 Fed. Reg. at 9385. Viewing averaging as “an
equivalent, more flexible, and less costly alternative”
to requiring units to demonstrate compliance indi-
vidually, EPA explained that permitting averaging is
part of its “general policy of encouraging the use of
flexible compliance approaches where they can be
properly monitored and enforced.” Jd.
Environmental petitioners concede the averaging
alternative will not result in an increase in a source’s
total emissions beyond the level permitted under the
58a
applicable standard, see Envtl. Pet’rs’ Br. 18, and
while theoretically averaging could allow an
individual unit’s emissions to exceed the standard,
under the Final Rule that exceedance must be offset
by other, better-performing units to demonstrate
compliance. They have not challenged EPA’s inter-
pretation of the ambiguous term “so
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