Opposition Brief — PPG Industries, Inc. v. United States Environmental Protection Agency

Supreme Court, U.S.

EILED

APR 2 1990

No. 89-1079

. POSEPH F. — IR

a eel

Jn the Supreme Court of the United States

OcTOBER TERM, 1989

PPG INDUSTRIES. INC... PETITIONER

V.

UNITED STATES ENVIRONMENTAL PROTE¢

AGENCY, ET Al

TiN

NV PLIITION FOR A WRIT OF Cl

; ED STATES COURT OF APP i

LAIE FIFTH CIRC!

BRIEF FOR THE FEDERAL RESPONDENT IN OPPOSITION

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OLESTIONS PRESENTED

1. Whether EPA acted arbitrarily in basing certain effluent

limitation standards under the Clean Water Act, 33 U.S.¢

1251 ef seg., on the average of actual data from two plants,

where the reviewing court found that the limitations are

achievable through use of the model pollution control

technology

2. Whether EPA acted arbitrarily in establishing variability

limitations for those standards by using statistical model

ing techniques that account for the full range of variability

that can reasonably be expected at plants that properly

operate the model technology, where the reviewing court

found that discharges that exceed the variability limits eithes

would result from correctable problems or would be excused

by the regulatory upset defense contained in 40 C.F.R

}22.41(n)

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Argument

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PMC Corp. vs. EPA, 539 F.2d 979 (4th Cir

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Hooker Chemicals & Pl Cory Train, 33

fF Jd 620 (2d Cir. 1976) }4

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VI

Miscellaneous — Continued: Page

pp. 42,564-42,565 20

p. 42,565 20

pp 4? 565-42 .5$66 ]

p. 42,580 5

p. 42,581 .

H.R. Rep. No. 189, 99th Cong., Ist Ses

(1985) j

> Rep No. 414, 92d Cong st Sess. (1971)

Hn the Supreme Court of the Cited States

: 2 1 (ER | RA] 199

BRIEF FOR THR FEDERAL RESPONDENT IN OPPOSTTION

OPINIONS BELOW

IL RISDIC TION

STATEMENT

\

discharges in two, Increasingly stringent, stages. First, EPA

o establish etfluent limitations based on the “best prac-

ticable control technology currently available” (BPT). 33

U.S.C. 1311(0b)(1)(A), 1314(b)(1)(B). These limitations are

(oO represent the “average of the best” treatment technology

available in the industrial category involved. Pet. App. 45a;

EPA v. National Crushed Sione Ass’n, 449 U.S. 64, 76 n.15

(1980). The OCPSF regulations establish limitations on

discharges of conventional pollutants based on the BPI

standard.°

[he second, more stringent, set of effluent limitations ts

to be based on the “best available technology economically

achievable” (BAT). The BAT effluent limitations are to be

set at a level that “will result in reasonable further progress

toward the national goal ot eliminating the discharge of all

pollutants.” 33 U.S.C. 1311(b)(2)(A). Thus, “[t}]he distine-

tion between ‘best practicable’ [BPT] and ‘best available’

[BAT] is intended to reflect the need to press toward in-

creasingly higher levels of control.” Congressional Research

Service, 4 Legislative History of the Water Pollution Con-

trol Act Amendments of 1972, 93d Cong., Ist Sess. 170

(1972) {hereinatter Leg. Hist.|. BAT effluent limitations

“should at a minimum be reterenced to the best performer

In any industrial category.” Leg. Hist. 1468-1469; S. Rep.

No. 414, 92d Cong., Ist Sess. 50 (1971); see, e.g., Amnerican

Paper Inst. v. Train, 543 F.2d 328, 346 (D.C. Cir.), cert.

dismissed, 429 U.S. 967 (1976). The OCPSF regulations

Conventional pollutants are measured, iter alia, by biochemical

enh demand (BOD)—-which measures the oxygen required by

Heal organisms to assimilate the biodegradable portion of a waste

inder deroble conditions — and by totai suspended nontilterable solids

(ESS) —which measures the dispersed insoluble inorganic and organic

ompounds in the NASTCWaAEel 33 4 1314(a)(4); 1() ¢ | R 40] 16

4

establish effluent limitations for toxic pollutants based on

the BAT standard.?

For direct dischargers, the effluent limitations are im-

plemented and enforced through individual “national pollu-

tant discharge elimination system” (NPDES) permits issued

pursuant to the Act. 33 U.S.C. 1342. Each NPDES permit

contains numerical discharge limits and other specific terms

and conditions governing the activities of the discharger to

which it applies.4

2. The Regulatory History. The OCPSF regulations,

codified at 40 C.F_LR. Pt. 414, apply to approximately 1000

plants that produce a wide variety of organic chemicals,

plastics and synthetic fibers. 52 Fed. Reg. 42,522, 42,525

(1987). In these regulations, EPA promulgated effluent

limitations guidelines and standards for 3 conventional

pollutants and 63 toxic pollutants for new and existing plants

’ foxte pollutants are those listed in accordame with 33 U.S.C.

1317(and). See 40 CLELR. 401.15.

* Because the discharge limitations are established through national

wWemaking and are unitormly applicable throughout an entire industrial

category, EPA has established a system for addressing claims that a

particular plant should not be held to the national effluent limitation

guidelines and standards. See Chemical Manufacturers Ass'n. NRDC,

470 US. 116, 134-133 (1985); EPA 8. National Crushed Stone Ass'n,

449 US. at 80. Under that system, EPA may grant a “fundamentally

different factor” (PDE) sanance, and establish for a particular facility

an alternative to the otherwise appheable nauonal effluent limuation

guideline. 40 C FR. Pt. 125, Subpt. D

Congress codified this approach in the 1987 amendments to the Ac,

rccogmzing the EDE procedure as the appropriate way to consider

unique factors applicable to a particular taciity, thus asoning undue

comphcation and delay in establishing national etflucmt eumdelines and

vandards HER Rep No 189, 99th Cong, Ist Sess. 26 (1985) An EDI

variance Will be vranted if the applicant “demonstrates to the satistac

fon of [EPAY” that the crtena set tomhin JEU SO PEO

and (8) are met

that discharge directly and indirectly into the national

waters.’ /d. at 42,580, 42,581. Implementation of these

regulations will remove more than 100 million pounds of

pollutants annually trom those waters. /d. at 42,537, 42,539,

42,548.

a. EPA selected different model pollution control

technologies to establish effluent limitations for the different

types of pollutants discharged by plants within the OCPSF

category. See, e.g., 52 Fed. Reg. 42,536-42,544 (1987). These

model technologies were used to establish the particulars level

of control required by the Act through the use of actual

data and various analytical and statistical modeling techni-

ques. EPA collected raw data trom certain OCPSF plants

that had used a selected model technology in the past, and

edited the data based upon various general criteria to

eliminate plants or sets of data that were unusable, or that

represented inadequate performance. See, e.g., id. at

42,533-42,536, 42,539-42,540.° A “long-term average” con-

centration of the discharge levels for each pollutant

achievable by the data base plants over time was then

calculated trom the edited data base.

EPA expects that facilities will design and operate their

ircalment systems to achieve pollution release levels below

or al the appropriate long-term average; however, EPA

> The desclopment of these limitations required a very technical and

comples rulemaking process. Over an eleven-year period, EPA relied

upon more than 59,000 data pomts reflecting actual discharges from

esting plants sce R.114,686-R. 115,047 and R.15,316-R.115,563), per-

formed numerous studies, received more than 15,000 pages of public

comments on agency proposals, and produced 2,500 responses to these

comments. The process resulted in an administrative record comprised

of approximately 600,000 pages. Pet) App Ja, 234; 52 bed. Reg.

42526-42531, 42,554 (1987)

© This editing ensured, to the extemt practicable, that the selected

plants represented an adequate level of Control tor use in establishing

thie Usnsatatsennis

establishes limitations at substantially higher levels to allow

for tluctuations in discharge levels that may reasonably oc

cur above and below the long-term average. Therefore, EPA

routinely establishes two variability factors for each pollu

tant to reflect the maximum expected deviations that may

occur during One-day and monthly periods if the mode!

technology ts operated properly. This factor, which ts always

greater than one, ts then multiplied by the long-term average

for each pollutant to obtain the actual limitations: the “max

imum for any one day” and “maximum tor monthly aver

age” limitations and standards tor each pollutant in 40

C.F.R. Pt. 414. Pet. App. 87a.

EPA calculates variability factors by using statistical

modeling techniques that extrapolate from the edited data

base to estimate the probability of every theoretically poss

ble discharge. The daily maximum and monthly maximum

average variability factors are calculated from statistical

distribution curves developed for each pollutant. These

distribution curves are generated by various mathematical

equations using values calculated trom the actual data. C.A

App. 3877, 3907-3911, 4438-4441, 4448-4461. The distribu

tion curves are thus hypothetical constructs that describe

the probability that any given discharge level —trom just

above Zero to infinity — will occur; although any discharge

level is theoretically possible, extremely high levels are ex

ceedingly improbable, and often actually impossible. See

thid

Variability tactors are intended to provide meaningtul

levels of control. They are thus calculated to retlect only

the reasonable variations in pollution discharge levels in et

fluent from a properly operated tacility, and not merels

[he pot ont urse below which all of the statistical distribu

balls, tf (ih percentile, represents an infinite discharve level

i‘ \ Vp 994) il iad inie. I f caduifse phaol jr? sibl iti

theoretically possible discharge levels, or Ones resulting trom

poor operation. See 52 Fed. Reg. 42,564-42,565 (1987). Ac-

cordingly, EPA consistently establishes the daily and month-

ly variability factors at the 99th and 95th percentiles —/.e.,

the points on the curve of hypothetically possible discharges

below which 99 and 95% of the daily and monthly average

distributions fall, respectively.

in the OCPSF industry, EPA calculated variability tac-

tors that range from 1.22 to 15.7 for the daily maximum

and maximum monthly average limitations (C.A. App.

3879-3882, 3920-3924). When multiplied by the long-term

averages, the variability factors result in generous effluent

limitations and guidelines, which provide facilities in the

OCPSF category with very wide operating margins, permit-

ting them to discharge at levels ranging up to 15 times the

long-term average performances of the model facilities.

In response to concerns that similar limitations previously

calculated under the Act failed to account for variations

that might occasionally occur despite exemplary operating

and quality control procedures, EPA promulgated a

regulatory “upset” defense in 1979. 44 Fed. Reg 32,854,

32. 863.* Accordingly, each NPDES permit issued by EPA

now provides dischargers with an affirmative defense to

prosecution tor any violation of the applicable limitations

wherd the excess discharge is uncontrollable, provided that

the criteria set forth in 40 C.F.R. 122.41(n) are satisticd

See 52 Fed. Rev. 42,565-42,566 (1987)

see Pl 1-2.

‘JOC FR. 122. 410001) specifies that on “uy

an cxeephional incident in which there

porary noncompliance with technology Based |

lunitations because Of factors beyond the feasonadic rit

ihe perimiitier \n upsel i snot include nom ipl

fet caused by operational crror, improperly desixzt

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all the PPG plant 913 data points tell below that limitation

In the case of chloroform, the average of PPG plant 913

lata points was above the monthly average limitation,

though the average of the Dow plant 415 data points fell

below that limitation.

3 The Opinions Below. Twenty-eight industry peti-

tioners (including individual companies and industry trade

associations) and the Natural Resources Detense ¢ ouncil

raised numerous challenges to the OCPSF regulations. The

Court Ol appeals carefully reviewed these challenges, well

aware that “judicial review ‘must be based on something

more than trust and faith in EPA’s experience[;]’ a court

may not respond to claims of technical expertise by ‘rub-

ber stamping’ an agency decision as correct.” Pet: App. 28a

(footnote omitted).'? The court then rejected all of the in-

dustry petitioners’ arguments and the majority of those

raised by NRDC, remanding a portion of the rule for

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913 tor chlorotorm was 129.2 micrograms per liter (ug/1), slightly above

pecitically, the overall average discharge level trom PPG plant

the promulgated monthly average chloroform limitation of 111 ug/|

(The plant 913 averave figure is somewhat misleading, ‘ince it is based

on one month during which the plant achieved the monthly average

limitation, one month when it did not achieve that limitation, and a

iiwle data point trom a third month that was above that limitation.)

[he overall average discharge level tor chloroform at Dow plant 415,

howeser, was 10.5 ug b. R. 115,500

Dow plant 415 had one daily TCE discharge of 85 ug 1, which ex

ceeded the maximum daily limitation of 69 ug/L. Nevertheless, The Dow

pant » lomz-tenn dverdave discharge level tor [TCE was only 16.1 ux a

and PPG plant 913 had no daily TCE discharge level greater than the

minimum detection level of 10 ug 1. R. 115,508; Pet. App. 112a

190a-1Y1a. (The court of appeals uses the term ppb, tor parts per billion

Which os CQUIS ale nt to ue | )

\ considerable body of case law has evolved establishing the stand

ards for judicial review of the methodology employed by EPA in pro

mulvating ettlucnt limitations under the Act. Pet. App. 254-264 nn. 3s

xY (CItIne Cases)

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the one, unusually high discharge value for TCE in the Dow

plant 415 data base does not make the limitation

unachievable. The court suggested that the atypical value

resulted either trom an upset that was unlikely to recur or

from quality-control problems within Dow’s control. Pet.

App. 112a-113a, 190a-191la.'? Second, the court of appeals

rejected petitioner’s premise that unless one plant can be

shown to have achieved all the limitations for TCE and

chloroform, the limitations are necessarily unachievable

under the Act. The court thus upheld EPA’s interpretation

of the statute that it is responsible for administering, con-

cluding that the Act permits EPA to determine the “best”

plant tor establishing limitations on a pollutant-by-pollutant

basis. /d. at 112a-113a. For this reason, “an exceedance by

one of the data-base plants ts irrelevant so long as another

data-base plant demonstrates that the limitations are

achievable.” /d. at 113a. Accord id. at 191a.

[he court of appeals also rejected petitioner's claim that

the wastestream matrices of the data base plants made the

limitations unachievable. Pet. App. 113a-l14a. The court

Ot appeals relied upon EPA’s determination that steam-

stripper technology can be modified to account for a par-

ticular plant’s wastestream matrix and that through the use

of such properly designed technology all the OCPSF plants

would be able to achieve the limitations for volatile

pollutants. /bid

b. Petitioner also argued below that EPA’s use of the

99th and 95th percentiles to establish variability factors will

result in excess discharges that cannot be controlled by well-

The court did not discuss whether the tailure of PPG plant 913

lo quite satisty the monthly average limitation tor chlorotorm meant

that that plant could not achieve all the limitations. Nevertheless, the

court's conclusion that there was no showing that Dow plant 415 could

not meet the limitations tor all pollutants necessarily indicated that pets

(ioners objections to those limitations were without 1

12

designed, well-operated facilities that employ model

technology. It further contended that the regulatory upset

defense (40 C.F.R. 122.41(n)) does not provide adequate

relief Where uncontrollable exceedances occur because EPA

allegedly edited, /.e., deleted, all data that would satisty that

regulatory defense.

The court of appeals rejected these arguments. It ex

plained that the discharges represented in EPA’s model that

exceeded the 99th and 95th percentiles of the average

statistical distribution curves were reasonably excluded in

[EPA’s variability tactor calculation, because EPA could

reasonably assume that these points were isolated and ex

treme departures trom normal pertormance that were due

to quality-control problems. Pet. App. 90a-93a, 188a

Where discharges exceed the 99th and 95th percentiles, the

court reasoned that, it they result from quality control pro

blems, they can be controlled, and if they cannot be con

trolled, the regulatory upset detense ts available. /d. at 93a,

189a. Finally, the court reyected petiuioner’s contention that

all individual data points that may have resulted trom upsets

vere deleted trom the data base. /d. at 189a

\

ARGUMENT

Phe decision below ts correct and does not conthict with

any decision of this Court or of any other court of appeals.

Nloreover, the issues raised by petitioner are extremely nal

row and technical, and turn on the precise record in this

rulemaking. Thus, they do not merit review by this Court

la [hic iVamen Of petuoner’s first argument Is that

monthly-average chlorotorm and daily maximum [Ct

nitations are not “achievable” within the meaning of 33

U.S.C. 1311M(b)(2)(A) and 1314(b)(2)(B) because no one

the EPA data base comphed pertectly with the

ations tor both pollutants. See note 11, supra. The court

13

of appeals, however, correctly held that the Dow plant’s

single TCE discharge above the daily maximum limitation

did not mean that the limitation was not achievable by that

plant.'+ Therefore, petitioner’s argument, which is based

on the claim that no one plant can meet all the limitations,

amounts at bottom to an attack on this determination of

the court below, a determination that is fully supported by

the record. Petitioner’s objections to that narrow fact-based

determination do not warrant review by this Court.'?

b. There is, in any event, no merit to petitioner’s asser-

tion that it was inappropriate for EPA to base the limita-

tions for chloroform and TCE on an average of the data

from two plants with good records in using the steam strip-

per technology, rather than from a single best plant. It is

natural that the data from two different plants will differ

to some extent, and in such instances averaging of the two

to develop technology-based limits is entirely reasonable.

BASF Wyandotte Corp. v. Costle, 598 F.2d 637, 655 (ist

‘+ The court below explained (Pet. App. 112a-113a, 190a-191a) that

EPA could reasonably conclude that the sole Dow TCE discharge that

exceeded the TCE limitation resulted trom an upset or a correctable

quality control problem, in light of the plant’s long-term average TCE

discharge level and “because on all other occasions the Dow plant was

able to perform within the limitations.” /d. at Il2a.

(> The court’s reliance on EPA’s expertise when interpreting sampl-

ing data (Pet. App. 190a-191a) is unexceptional. See, e.g., United States

Steel Corp. v. Train, 556 F.2d 822, 842 (7th Cir. 1977) (“EPA * * *

is entitled to use its expertise in pollution-control technology in judg-

ing the reliability or representative quality of particular data” (citing

cases)). Moreover, the court’s decision ts entirely consistent with other

cases. See, e.g., American Petroleum Inst. v. EPA, 540 F.2d 1023, 1034

(10th Cir. 1976) (limitations upheld where compliance 90, 80 and 70%

of the time), cert. denied, 430 U.S. 922 (1977); American Meat Inst

v. EPA, $526 F.2d 442, 458-459 (7th Cir. 1975) (limitations upheld where

one plant met them during 15 months out of a two-year period and

the other did so for three-quarters of a two-year period)

14

Cir. 1979), cert. denied, 444 U.S. 1096 (1980).'® Nor was

that approach really detrimental to petitioner; petitioner’s

argument Overlooks the tact that averaging the PPG and

Dow plant data necessarily increased the chlorotorm limita-

tions above those that would have resulted were the Dow

plant alone, with its lower chlorotorm discharge levels,

utilized as the single “best” plant tor developing those limits.

See note 11, supra; ct. Pet. App. 90a.'’

c¢. Petitioner also contends that the decision of the court

below is wrong as a matter of law, on the theory that the

Act prohibits EPA trom. selecting the best plant tor

estabiishing BAT ettluent limitations on a pollutant-by-

pollutant basis. But the plain language of the relevant

Statutory provisions (33 U.S.C. 1311(b)(2)(A),

1314(b)(2)(B)) contains no such prohibition, which would

be illogical and inconsistent with the statutory purpose.

© Because the data obtained trom each plant was averaged to develop

| |

the chloroform and TCE limitations, it was inevitable that some of that

data would he above the average. It is accordingly scarcely surprising

that some of ihe data trom either plant may exceed the limitations that

are based upon the average of the data

'” The Second Circuit in Alooker Chenmucals & Plastics Corp. \. Trav

337 F.2d 620, 633 (1976), addressing the use of averaving to devel |

BPT limitations, identified the central tlaw in the type of argumei

peuuioner makes here

Phe fallacy of Pethhboners’ argument ts the assumption thal

sion of an industrial plant within the category “best existin

stitutes an implied determination that the plant’s techno!

“best practicable” and that the plants’ ettluent discha

the maximum achievable [within the relevan. time trame]

See also American Meat Inst. \. EPA, 526 F.2d at 457. Sim

petitionel here areues that Decause Its plant is among the be |

formers, is performance is the maximum achievable | BAI

technology. This argument, reyected in Flooker Chenucals in the BP I

content, Is even less persuasive in the context of BAT

“should at a minimum be referenced to the best pertorme lev ll

1468-1459)

iia a

15

Moreover, none of the cases on which petitioner relies sup-

ports its contention or conflicts with the decision below.

i. Arequirement that a single best plant be selected for

establishing the limitations for all the pollutants regulated

under BAT would be illogical and inconsistent with the

structure and goals of the Act. This is particularly evident

when different pollutants have to be treated by different

technologies. See 52 Fed. Reg. 42,539-42,544 (1987). In this

situation, a plant may utilize entirely separate technologies

(oO treat two different pollutants, with the treatment of one

pollutant having no bearing on the treatment of the other.

There is no reason, in such a situation, why EPA should

be required to identify a single best performer for both

pollutants if no one plant’s treatment is exemplary for both.

The analysis is no different where, as here, the treat-

ment technology is the same for two pollutants.'® There is

sull no reason why EPA should be required to identify a

single plant as the best performer for both pollutants, unless

the treatment or presence of one pollutant somehow im-

pairs the treatment of the other, /.e., wastestream

characteristics interfere with the proper treatment of both

pollutants. See, e.g., 52 Fed. Reg. 42,540-42,544 (1987).

EPA properly considered these technical concerns (/bid.;

C.A. App. 3732),'% and its conclusion that wastewater

between treatment of multiple

* The Act does not distinguish

pollutants by a single technology and by separate technologies, and there

is NO basis tO Maintain, as petioner does, that the Act requires that

a single plant meet all of the imitations in the former situation. The

statutory ianvuage simply does not support such a restriction on EPA’s

e\pert judgment

‘EPA also considered the costs tor various types of steam-strippelr

upevrades in its determination that the BAT limitauions are achievable.

Surreply CoA. Addendum Exh. 14

16

matrices do not preclude compliance with the limitations

was properly upheld. Pet. App. lida. Throughout the

rulemaking proceedings, petitioner has provided absolute

ly no technical information to rebut these tindings

Pherefore, this issue does not warrant review by this

Court.*!

li. Petitioner’s claim of a contlict in the decisions ts in

correct. In making this claim, petitioner places principal

reliance on a brief observation in Janners’ Council of

tynerica Vv. Train, 540 F.2d 1188 (4th Cir. 1976). But that

case is readily distinguishable trom this one. In the first

place, that court was interpreting the less stringent BP |

limitations; the court itself emphasized that the statutory

standards tor the two limitations are quite different. /d. al

‘

1195. Moreover, the COUTL 1D launners’ ( ouncil address ul

an entirely ditterent issue trom the ones involved in the

17

present case — whether EPA, in establishing limitations for

a given industrial category had sufficiently substantiated its

decision to rely on technology from a different category with

dissimilar wastes. The court’s observation that “[a] few

plants [in the regulated industrial category] are presently

capable of meeting the limitations for some, but not all of

the pollution parameters” (/d. at 1193) was made in the con-

text of its consideration of whether EPA had satisfied the

established technology transfer requirement—that EPA

“make a reasonable prediction that the technology, if used

in the industry, will be capable of” meeting the limitations.

Id. at 1192 (citing cases). Because the court found that the

record betore it contained “no evidence” to support EPA’s

conclusion that the affected industry could consistently meet

the promulgated limits by the use of the designated

technology, it remanded the case to EPA for further pro-

ceedings. /d. at 1193-1194. In sum, the dictum in 7anners’

Council does not establish the general principle urged by

petitioner, even in the BPT context; it is plainly not in con-

flict with the conclusion of the court below regarding the

BAT limitations at issue here.

Phere is likewise no merit to petitioner’s additional claim

(Pet. 12) that the decision below is “at odds with” Associa-

tion of Pacific Fisheries v. EPA, 615 F.2d 794 (9th Cir.

L980); CPC Intl, Inc. v. Train,’ 540 F.2d 1329 (8th Cir.

1976), cert. denied, 430 U.S. 966 (1977); and National Lime

iss’n Vv. FPA, 627 F.2d 416 (D.C. Cir. 1980). As the court

below observed (Pet. App. 191a), neither Pacific Fisheries

nor CPC Inrl, Inc. is inconsistent with the instant case.

‘Here, in contrast [to those decisions], at least one plant can

meet every BAT limitation.” /bid. In addition, in Pacific

Fisheries the court remanded one part of the regulation

under consideration there to the agency simply because the

study on which EPA had relied in establishing the relevant

limitation was insufficient: “[t}he study measured the

OO

18

BOD; and TSS contained in the wastewater before entry

to the lagoon * * * , but the record reveals only the reduc-

tion in BODs in the effluent leaving the lagoon. * * *

{T]here is no indication as to whether the TSS andO & G

levels would be sufficiently reduced” to comply with the

limitations on those pollutants. 615 F.2d at 819. Similarly,

in CPC Int'l, Inc., the court analyzed the data upon which

EPA relied, and found that “the TSS standard proposed

by the EPA finds no support from [those data]” 540 F.2d

at 1339,?

2. Petitioner’s second principal challenge concerns

EPA’s determination of the variability factors for use in

calculating the OCPSF effluent limitations guidelines and

standards. Petitioner contends that EPA’s use of the 99th

and 95th percentile approach to establish variability factors

will result in exceedances that cannot be controlled by well-

designed, well-operated facilities that employ model

technology. It further contends that the regulatory upset

defense (40 C.F.R. 122.41(n)) does not provide adequate

relief where uncontrollable exceedances Occur because EPA ©

allegedly edited, /.e., deleted, all data that would satisfy that

defense.

22 National Lime Ass'n involved regulations based on a different

methodology to account for variability under a quite dissimilar statutory

provision: Section 111 of the Clean Air Act (42 U.S.C. 7411). In con

trast to the Clean Water Act, the Clean Air Act contains no general

Variance provision (see note 4, supra), so Section 111 standards must

account for “all variations of operating conditions being considered

aryWhere in the country” 627 F.2d at 433 (italics omitted). According-

ly, the court in Navional Lime Ass'n criticized EPA’s exclusion trom

its data base of the data trom a plant that did not achieve the stand-

ards selected, although it held that this alone did not necessarily make

the standard unachievable. /d. at 444. Moreover, three plants in the

data base upon which EPA relied did achieve all those standards. /bid

Even under petitioner’s interpretation of the Clean Water Act, that tact

would have justitied BAT-based limitations under that Act.

19

The decision below is correct. It does not conflict with

any decision of this Court or any of the many court of ap-

peals decisions that have already addressed this issue.?3 Peti-

tioner essentially disputes the highly specific fact-based fin-

dings that were made by EPA and upheld by the court of

appeals, based upon a thorough analysis of EPA’s editing

criteria contained in the rulemaking record. There is no need

for further review by this Court.

Each court of appeals that has reviewed EPA’s

methodology in establishing variability factors has recog-

nized that EPA’s use of the percentile approach is designed

(oO result in meaningful controls on daily maximum and max-

imum monthly average releases, while accounting for only

reasonable fluctuations in treatment. The limitations are not

designed to reflect extreme hypothetical discharge levels,

Or even to permit poor performance that can be controlled

by quality control measures. See, e.g., Weyerhaeuser Co.

V. Costle, 590 F.2d at 1057. EPA’s percentile approach im-

plements the important goal of ensuring that vigilant at-

tenuion is paid to the reduction of controllable variations

in treatment levels on a daily and monthly basis through

the use of proper maintenance and quality control measures.

[bid.; see, e.g., United States Steel Corp. v. Train, 556 F.2d

‘See American Petrolewn Inst. \. EPA, 661 &.2d 340, 350-353 (Sth

Cur. IYS1); Corn Refiners Ass'n v. Costle, 594 b.2d 1223, 1224-1226

(Sth Cir. 1979); Weverkaeuser Co. s. Costle, 890 b.2d 1011, 1056-1058

(D.C. Cir. 1978); Onited States Steel Corp. \. EPA, 556 F.2d 822,

841-842 (7th Cir. 1977); Marathon Oil Co. v. EPA, 564 F.2d 1253,

1266-1274 (Yth Cir. 1977); CPC Inv, Inc. \. Train, 540 &.2d 1329,

1336-1338 (sth Cir. 1976), cert. demed, 430 U.S. 966 (1977); American

Petrolewn Insts. EPA, 540 &.2d 1023, 1035-1036 (LOth Cir. 1976), cert.

denied, 430 US. 922 (1977); EMC Corp. \. EPA, 539 F.2d 973, 985-986

(4th Car. 1976).

20

at 842; American Petroleum Inst. v. EPA, 540 F.2d at 1036;

52 Fed. Reg. 42,564-42,565 (1987); C.A. App. 2987-3004.

The court of appeals recognized that even “well-operated

plants occasionally will experience quality control prob-

lems.” Pet. App. 190a. As the court concluded, it is

reasonable to expect that the extreme discharges represented

by one percent and five percent of the statistical distribu-

tions will either be controllable by better quality control

practices and plant operations, or will be subject to the upset

detense. /bid.; see 52 Fed. Reg. 42,564, 42,565 (1987). This

fact-based determination does not warrant review by this

Court.

Contrary to petitioner’s claim, EPA’s use of variability

factors is consistent with each of the court of appeals deci-

sions that has considered this issue. As the courts have

recognized, given EPA’s statistical methodology “[t}here is

always a theoretical chance that a plant achieving the limita-

tions on a long-term basis will exceed the monthly and daily

limits.” American Petroleum Inst. , 540 F.2d at 1035-1036.?7

74 The Ninth Circuit explained in Merathon Oil Co. \. EPA, 564

F.2d 1253, 1272 (1977), that establishing a limitation that assured 100%%

comphance “would probably be so liberal as to be worthless as a con-

trol standard.” See pp. 6-7 & note 7, supru.

Petitioner makes much of the contention that EPA’s percentile

method of establishing variability factors results in a predictable non-

compliance rate, citing, wiler alia, a“ Training Manual tor NPDES Per-

mit Writers.” Pet. Br. 17; Pet. App. 26la. That document, developed

by an outside contractor in May 1987, states on its title page that “[t}he

material in this manual is for instructional purposes only{;] [jt * * *

does not necessarily represent official policy of the U.S. EPA.” In any

event, the manual, which ts not part of the administrative record below

and was accordingly struck trom the record by the court of appeals,

is a general document for permit writers; if was not intended to ad-

dress the specific practices employed in the OCPSF rulemaking.

It is, however, irrelevant whether EPA’s methodology is construed

to result in a predicted noncompliance rate, or, as the court below

21

~

Most of the cases on which petitioner relies were decided

prior to 1979, when EPA promulgated the regulatory upset

defense. At that time, EPA addressed this matter through

the exercise of its enforcement discretion alone. Most of

the courts of appeals upheld EPA’s approach, approving

its policy of not bringing enforcement actions where rare

exceedances that could not be controlled occur, and

recognizing that limitations should be adequately stringent

to require facilities to control extremes in variability.>

The Ninth and the Fourth Circuits, however, in the cases

upon which petitioner relies (Pet. 17, 19), remanded cer-

tain technology-based limitations because EPA had not for-

mally provided relief to offset the possibility of an uncon-

trollable exceedance.?° In Marathon Oil, 564 F.2d at 1272,

the court required that EPA provide relief for “ ‘excursions’

when they actually occur, by determining whether exemplary

use of [the model technology] could have avoided the ex-

cursion.” Similarly, in FMC Corp., $39 F.2d at 985-986,

the Fourth Circuit required EPA to provide relief for possi-

ble exceedances. In 1979, EPA promulgated the upset

concluded (Pet. App. 190a), simply to reflect the possibility of uncon-

trollable exceedances or Occasional quality control problems. See, e.g.,

American Petroleum Inst., 540 F.2d at 1036. Under either approach,

the availability of the upset defense affords adequate relief for uncon-

trollable exceedances.

>> See Weverhueuser, 590 F.2d at 1056-1058; United States Steel

Corp., 556 F.2d at 841-842; Corn Refiners Ass'n, 594 F.2d at 1224-1226;

CPC Intl, Inc., 540 F.2d at 1336-1339; American Petroleum Inst., 540

F.2d at 1035-1036.

7¢ Petitioner also relies on the D.C. Circuit’s decision in National

Lime. That decision, which reviewed regulations promulgated under

the Clean Air Act, is simply inapposite. See note 22, supra. Significantly,

the D.C. Circuitin Weverhaeuser, 590 F.2d at 1056-1058, upheld EPA’s

approach under the Clean Water Act before the upset defense was

promulgated.

Nm

i)

defense to address these concerns. 44 Fed. Reg. at 32,863.

Because the upset defense is available to offset uncon-

trollable exceedances in the OCPSF category, EPA’s ap-

proach in the rulemaking ts consistent with Marathon Oil

and FMC Corp.?’

Petitioner additionally contends that the regulatory upset

defense will not be available in case of an uncontrollable

exceedance of the OCPSF limitations by a properly designed

and operated facility, because EPA allegedly edited from

the data base every instance to which the upset defense

would apply before EPA selected variability factors. This

argument is based upon the erroneous assumption that one

of EPA’s “BAT technology performance” editing criteria,

which identifies “treatment system upsets” as an example

of unrepresentative performance (Pet. App. 189a (quoting

C.A. App. 3883, 3885)), means that EPA edited all data

points that would satisfy the highly taci-intensive regulatory

upset defense.?°

2” Petitioner also asserts (Pet. 19) that the decision below is “at odds

with” American Petroleum Inst., 661 F.2d at 347, decided atter the

regulatory upset defense was promulgated. In that decision, the court

reviewed challenges to technology-based wastewater regulations for the

petroleum refining industry that were developed using EPA’s percen-

tile approach. The court carefully reviewed the decisions in FIC Corp.

and Marathon Oil, and concluded, in the context of the issues before

it, that the regulatory upset defense satistied the concerns expressed

in those cases. /d. at 350-353. Because the upset defense applies to the

OCPSF regulations, the decision below and EPA’s regulations are con-

sistent with American Petroleum Inst.

75 EPA could searcely have applied the regulatory upset criteria set

forth in 40 C.F.R. 122.41(n)(3) to the thousands of data points it utilized

to establish the OCPSF limitations — even had it wished to do so, tt

lacked sufficient information to edit on such a basis. See, e.g., CA.

App. 3872 (BPT editing). The detailed daily operating conditions ot

the plants which submitted data were known only to the plant operators,

not to EPA. C.A. App. 2987. See Pet. App. 189a-191a. EPA’s criteria

for editing the plants and data setswere necessarily far more general

23

The court of appeals carefully reviewed EPA’s editing

criteria and properly rejected this argument. /bid.?°

In any event, the court below held that regardless of how

EPA edited its data base, the regulatory upset defense re-

mains available to PPG plant 913 (or any other facility) if

petitioner can show that any such exceedance, if and when

it Occurs, was beyond its control (Pet. App. 93a):

If these data points result from quality-control prob-

lems, the exceedances they represent are within the con-

trol of the plant. If, however, the data points repre-

sent exceedances beyond the control of the industry,

the upset defense is available.

In short, the appropriate time to make the factual inquiry

as tO Whether a particular exceedance is uncontrollable is

when the exceedance occurs and a specific factual record

exists. Petitioner’s speculative concerns about the possibility

of future reliance on the regulatory upset provision con-

stitute no proper basis for challenging the entire OCPSF

regulation in this Court.

than petitioner’s argument assumes, and did not include a regulatory

upset criterion. See, e.g., C.A. App. 3868-3873, 4428-4435; Surreply

C.A. Addendum Exh. 16 (possible spills, upsets, and mechanical failures

included in the edited BPT data base); 52 Fed. Reg. 42,540 (1987) (BAT

editing); Surreply C.A. Addendum Exh. 15 (same).

°¥ Petitioner seeks to contradict the court’s tindings by noting the

only instance in which EPA edited two specific data points from a single

plant’s data set. Pet. 19. EPA, however, edited these two data points

because they resulted from improper Operation, not because they

sauistied the regulatory upset provision. C.A. App. 3108, 3890.

Moreover, and contrary to petitioner’s assertion, the fact that the PPG

plant average tor chloroform and the single Dow plant data point for

ICE were not edited trom the data base does not render the upset

defense inapplicable to any future exceedances that may occur.

24

CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted.

KENNETH W. SEARR

Solicuior General

BARRY M. HARTMAN

Deputy Assistant Attorney General*

Davip J. KAPLAN

Alforney

E. DONALD ELLIOTI

General Counsel

SUSAN G. LEPOW

Associate General Counsel

RUTH G. BELI

Assistant General Counsel

BRIAN P. GRANI

Atforney

Environmental Protection Agency

APRIL 1990

* The Assistant: Attorney General is disqualitied in this case.