Legal Consequences of EPA’s Endangerment Finding for New Motor Vehicle Greenhouse Gas Emissions

Legal Consequences of EPA’s Endangerment

Finding for New Motor Vehicle Greenhouse

Gas Emissions

(name redacted)

Legislative Attorney

December 15, 2009

Congressional Research Service

7-....

www.crs.gov

R40984

CRS Report for Congress

Prepared for Members and Committees of Congress

Endangerment Finding for New Motor Vehicle Greenhouse Gas Emissions

Summary

On December 15, 2009, the Environmental Protection Agency (EPA) took its most important

action to date related to climate change. EPA published its final determination that the combined

greenhouse gas (GHG) emissions from new motor vehicles in the United States contribute to an

“endangerment” from climate change. More precisely, EPA found that such emissions, in the

words of Clean Air Act (CAA) section 202(a), “cause or contribute to air pollution that may

reasonably be anticipated to endanger public health or welfare.” Under section 202(a), this

finding requires that EPA promulgate “standards” to control such emissions—as the agency

proposed to do for light-duty motor vehicles in advance of its endangerment determination.

Some groups have objected to the endangerment determination and the emission standards to

follow, arguing they will trigger a “cascade” of unacceptable regulatory consequences under other

CAA provisions. These regulatory consequences, they say, would impose unattainable GHGconcentration goals on EPA and the states, and/or economically and administratively

unreasonable burdens. This report examines the CAA provisions that have figured in this debate

to see whether this alleged cascade of legal consequences likely would occur.

First, the report examines CAA sections that, like section 202(a), are triggered by endangerment

findings. Of these, the one most likely to require EPA regulatory action after the 202(a)

endangerment finding is section 111, authorizing new source performance standards—but only as

to stationary source categories emitting the largest amounts of GHGs. Section 111, however,

affords EPA wide discretion in setting new source performance standards. Two other sections that

arguably might be triggered are 108, requiring national ambient air quality standards, and 115,

which requires states to revise their implementation plans to prevent or eliminate the

endangerment of public health or welfare in a foreign country. As to these sections, however, the

arguable infeasibility of the regulatory goals—even if GHG emissions in the United States are

significantly reduced, atmospheric concentrations would decline little—will give EPA room to

argue that regulatory action is not mandatory. Other endangerment-triggered sections of the CAA

can be distinguished from section 202(a) by their explicit terms, and thus would likely not be

triggered by the 202(a) endangerment finding.

Second, the report looks at CAA provisions having no endangerment trigger. Of these, EPA has

conceded that two require the agency to act after it promulgates the required emission standards

following the 202(a) endangerment finding. One provision would require EPA to impose “best

available control technology” (BACT) on GHG emissions from any major emitting facility

proposed to be constructed in a Prevention of Significant Deterioration area. The other, Title V,

creates an operating permit program for stationary sources of emissions, and would require

stationary sources subject to BACT under the first provision to also apply for Title V permits. As

to each of these requirements, EPA has proposed a “tailoring rule” setting emission thresholds far

higher than in the CAA, at least for a few years. EPA justifies the departure from statutory

language under the case law doctrines of “absurd results” and “administrative necessity.”

A caveat: the issue analyzed in this report is important primarily if Congress does not enact

climate change legislation that puts regulation of GHGs beyond the reach of some of the CAA

provisions discussed here. In particular, the House-passed climate change bill, H.R. 2454 (the

American Clean Energy and Security Act of 2009), states that three of the CAA sections treated

in this report, and one CAA title, may not be used to address air pollutants based on their climate

change impacts.

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Endangerment Finding for New Motor Vehicle Greenhouse Gas Emissions

Contents

Part One: Introduction.................................................................................................................1

Part Two: The Path to Now .........................................................................................................2

Part Three: CAA Sections with Endangerment Triggers Other Than Section 202(a) .....................4

Fuels and Fuel Additives .......................................................................................................5

National Ambient Air Quality Standards................................................................................6

New or Modified Stationary Sources .....................................................................................8

Non-202(a) Mobile Sources of Air Pollution ....................................................................... 10

Non-road Engines and Non-road Vehicles ..................................................................... 10

Aircraft Engines............................................................................................................ 10

Air Pollutants from the Loading and Unloading of Tank Vessels.................................... 11

Stratospheric Ozone Protection ........................................................................................... 11

Pollution in a Foreign Country Caused by Emission Sources in the United States ................ 12

Part Four: CAA Sections Having No Endangerment Trigger...................................................... 14

New Source Review in PSD Areas ...................................................................................... 14

Title V Permitting ............................................................................................................... 17

“Absurd Results” and “Administrative Necessity”............................................................... 18

Part Five: Final Thoughts .......................................................................................................... 20

Contacts

Author Contact Information ...................................................................................................... 21

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Endangerment Finding for New Motor Vehicle Greenhouse Gas Emissions

Part One: Introduction

On December 15, 2009, the Environmental Protection Agency (EPA) published its most

important action to date related to climate change. It found that the combined greenhouse gas

(GHG) emissions from new motor vehicles in the United States contribute to an “endangerment”

from climate change. 1 More precisely, EPA found that such emissions, in the words of Clean Air

Act (CAA) section 202(a),2 “cause or contribute to air pollution that may reasonably be

anticipated to endanger public health or welfare.”3 Under section 202(a), this final determination

requires that EPA promulgate “standards” to control such emissions from new motor vehicles.

It is not, however, the likelihood of standards for new motor vehicle GHG emissions that has

sparked controversy. Indeed, EPA’s proposed standards for emissions of carbon dioxide (CO2, the

principal GHG) from new light-duty vehicles were set so as to align with the Department of

Transportation’s simultaneously proposed fuel economy standards, and are reported to be

achievable with presently available technology. 4 Rather, objection has been raised to the section

202 endangerment finding for GHGs and the upcoming motor vehicle GHG emission standards

because of the argument they will trigger a cascade of unacceptable regulatory consequences

under other CAA provisions. These regulatory consequences, objectors say, would impose

unattainable air quality goals on EPA and the states, and/or economically and administratively

unreasonable burdens on both EPA and regulated entities.

This report examines the CAA provisions that have figured in this debate to assess whether this

alleged “cascade” of legal consequences would likely occur as the result of EPA’s endangerment

finding under 202(a) and resulting emission standards. Looked at another way, the report assesses

the legal leeway EPA has should it wish to limit its expansion of GHG regulation beyond new

motor vehicles under section 202(a).5 The reader also may wish to consult EPA’s own analysis of

this issue in an Advance Notice of Proposed Rulemaking (ANPR) issued in 2008,6 and the

analyses submitted to EPA in response to the ANPR. The policy pros and cons of using CAA

provisions other than 202(a) to address GHGs are treated in CRS Report R40585, Climate

Change: Potential Regulation of Stationary Greenhouse Gas Sources Under the Clean Air Act, by

(name redacted) and (name redacted).

1

74 Fed. Reg. 66,496 (December 15, 2009). EPA announced its determination and posted it on its website a week

earlier, on December 7, 2009, but it is publication in the Federal Register that starts the 30-day period before the

determination takes effect.

2

42 U.S.C. § 7521(a).

3

The term “welfare” is defined by the CAA to include, but not be limited to, effects on “soils, water, crops, vegetation,

manmade materials, animals, wildlife, weather, visibility, and climate, damage to or deterioration of property, and

hazards to transportation, as well as effects on economic values and on personal comfort and well-being….” 42 U.S.C.

§ 7602(h). In the preamble to the endangerment finding, EPA clarifies that its focus was on “public health and welfare”

in the United States. 74 Fed. Reg. at 66,497.

4

See Proposed Rulemaking to Establish Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate

Average Fuel Economy Standards, 74 Fed. Reg. 49,454 (September 28, 2009) (proposed jointly by EPA and the

Department of Transportation’s National Highway Traffic Safety Administration).

5

See, e.g., EPA chief signals opposition to Clean Air Act curbs on GHGs, in GREENWIRE (December 8, 2009).

(reporting the EPA Administrator’s position that the agency opposes the use of national ambient air quality standards to

reduce atmospheric concentrations of GHGs).

6

73 Fed. Reg. 44,354 (July 30, 2008). EPA concludes in the ANPR that “[a]n endangerment finding for GHGs under

one provision of the Act could thus have ramifications under other sections of the Act.” Id. at 44,418.

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Endangerment Finding for New Motor Vehicle Greenhouse Gas Emissions

A caveat: the issue analyzed here is important primarily if Congress does not enact climate

change legislation that puts regulation of emissions based on their climate change impacts beyond

the reach of some of the CAA provisions discussed here. In particular, the House-passed climate

change bill, H.R. 2454, states that sections 108 (national ambient air quality standards) and 115

(international air pollution) may not be used to address air pollutants based on their climate

change impacts. The bill also would prohibit the use of section 165 (requiring preconstruction

“new source review” in Prevention of Significant Deterioration areas) to regulate GHG

emissions, and specifies that no stationary source of GHGs could be required to obtain a permit

under Title V of the CAA solely because of its GHG emissions.

Part Two of this report offers some history as to how EPA came to issue its endangerment

determination for new motor vehicle GHGs on December 15, 2009. Part Three assesses EPA’s

leeway, following its endangerment determination, in deciding whether to regulate GHG

emissions from other sources—where those sources are covered by CAA provisions that, like

section 202(a), have an “endangerment” finding as the trigger. Part Four gauges the effect of the

same endangerment determination, or more accurately the standards that must follow, under CAA

provisions that lack an endangerment determination trigger. Part Five offers a summary and

comment.

Part Two: The Path to Now

The events leading up to EPA’s endangerment finding for new motor vehicle GHGs in 2009

began a decade earlier. In 1999, 19 organizations and 13 states petitioned EPA to regulate the four

GHGs emitted by new motor vehicles (carbon dioxide, methane, nitrous oxide, and

hydrofluorocarbons). Petitioners invoked CAA section 202(a):

The [EPA] Administrator shall by regulation prescribe … standards applicable to the

emission of any air pollutant from any class or classes of new motor vehicles … which in his

judgment cause, or contribute to, air pollution which may reasonably be anticipated to

endanger public health or welfare.

Petitioners argued that GHGs are “air pollutants” under the term’s definition in CAA section

302(g), 7 and that GHGs “endanger public health and welfare” because of their impact on global

climate. Thus, petitioners concluded, EPA must regulate such emissions through standards under

section 202(a).

EPA rejected the petition in 2003, concluding that GHGs are not “air pollutants” under the CAA

so the agency lacked authority to regulate GHG emissions from new motor vehicles based on

their climate change effects.8 Moreover, said EPA, even if it did have the authority, it would be

imprudent for the agency to exercise it at that time because of political opposition in Congress

and various Bush Administration policies opposing mandatory controls on GHGs. EPA’s rejection

7

The term “air pollutant” means any air pollution agent or combination of such agents, including any physical,

chemical, biological, radioactive (including source material, special nuclear material, and byproduct material)

substance or matter which is emitted into or otherwise enters the ambient air. Such term includes any precursors to

the formation of any air pollutant, to the extent the Administrator has identified such precursor or precursors for

the particular purpose for which the term “air pollutant” is used. CAA § 302(g); 42 U.S.C. § 7602(g).

8

68 Fed. Reg. 52,922 (September 8, 2003).

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of the petition was appealed to the federal appeals court in Washington, DC, which upheld the

agency’s decision 2-1.9

In 2007, the Supreme Court in Massachusetts v. EPA reversed the appeals court 5-4, finding for

Massachusetts.10 The Court held that for CAA purposes, GHGs are “air pollutants” and hence that

EPA has the power under the act to regulate GHG emissions from new motor vehicles. Moreover,

said the Court, the phrase “in his judgment” in section 202(a) does not permit EPA to avoid

regulation of air pollutants such as GHGs based on policy considerations. That is, an EPA

decision not to grant a section 202 petition must relate not to administration policy, but to whether

an air pollutant causes, or contributes to, air pollution which may reasonably be anticipated to

endanger public health or welfare.11 That being so, the EPA can avoid regulating GHGs under

202(a) only if it finds that GHGs “do not contribute to climate change or if it provides some

reasonable explanation as to why it cannot or will not exercise its discretion to determine whether

they do.”12 The Supreme Court decision did not order EPA to make a positive endangerment

finding, only to resolve the petition asking it to regulate vehicle GHGs on a correct understanding

of the CAA.

In response to Massachusetts v. EPA, the EPA under the Bush Administration moved toward an

endangerment determination in 2007 but ultimately backed off. On April 24, 2009, under the

newly arrived Obama Administration, EPA issued a proposed positive endangerment

determination for GHGs from new motor vehicles.13 In response, it received 380,000 comments.

On September 28, 2009, EPA also proposed the aforementioned emission standards for GHGs

from new light-duty motor vehicles—the standards required by CAA section 202(a) and referred

to in this report’s title. 14 (September 2009 was a busy month for EPA on the climate change front.

Besides proposing vehicle emission standards, the agency went final with its GHG monitoring

rule for large stationary sources,15 and proposed a “tailoring rule” discussed in Part Four of this

report.) Most recently, EPA published its final endangerment determination for GHGs from new

motor vehicles on December 15, 2009.

Actually, EPA’s endangerment determination consists of two findings, one addressing each

component of the section 202(a) endangerment provision. First, EPA found that current

atmospheric levels of the six major GHGs—from all emission sources—constitute in combination

“air pollution which may reasonably be anticipated to endanger public health and welfare.” This

is a generic determination, not tied to any particular source category. Second, EPA found that

emissions of GHGs by new motor vehicles (comprising four of the aforementioned six GHGs)

will in combination “cause or contribute to” those atmospheric levels. In contrast to the generic

determination, this finding is plainly linked to one source category. This bifurcation of the 202(a)

endangerment language is important in Part Three of this report. In Part Three, a reference to a

CAA endangerment provision being satisfied or simply to a “positive endangerment finding”

9

415 F.3d 50 (D.C. Cir. 2005).

549 U.S. 497 (2007).

11

Id. at 532-533 (quotations marks and brackets omitted).

12

Id. at 533.

13

74 Fed. Reg. 18,886 (April 24, 2009).

14

74 Fed. Reg. 49,454 (September 28, 2009).

15

Though announced on September 22, 2009, this rule was not published until many weeks later: 74 Fed. Reg. 56,260

(October 30, 2009).

10

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means that both the “may reasonably be anticipated to endanger” component finding and the

“contributes to” component finding are satisfied.

Part Three: CAA Sections with Endangerment

Triggers Other Than Section 202(a)

To what extent will the endangerment finding under section 202(a) narrow EPA’s discretion to

deal, or not deal, with GHGs under other CAA provisions with endangerment preconditions? The

CAA contains about a dozen such “endangerment” preconditions. Each one, like section 202(a),

establishes a precondition for EPA action against an air pollutant: EPA first must find that

emissions of that air pollutant (or group of pollutants) from a particular source category “cause or

contribute to air pollution which may reasonably be anticipated to endanger public health or

welfare.” Some endangerment provisions, not section 202(a), add the qualifier “significantly”

after “contribute,” and there are slight variations in singular/plural and punctuation; otherwise the

quoted language repeats throughout the statute. Depending on the CAA section, if EPA finds an

endangerment, it is required or at least authorized, usually without other preconditions, to take

action addressing the endangerment by the source category.

At the outset, an administrative law question arises. Since this report’s topic is whether EPA

might be forced to regulate GHG emissions under CAA provisions outside 202(a), one must ask:

Does EPA have to respond at all to petitions it receives for endangerment findings and standard

setting under those provisions? (At least 10 such petitions seeking EPA control of GHG emissions

from this or that source category have been filed with the agency since Massachusetts v. EPA.16)

Can the agency simply ignore requests to regulate GHG emissions, or inform a petitioner that

EPA is studying the matter without ever reaching a decision? None of the CAA endangerment

provisions expressly authorizes petitions to the agency, in contrast with other provisions in the

CAA and elsewhere that do establish petition mechanisms with agency deadlines for response.17

16

A summary of seven of these petitions is in the ANPR mentioned on page 1 of this report. 73 Fed. Reg. at 44,45844,462. Of the seven petitions, three address GHGs from ocean-going vessels, two from aircraft, and two from nonroad

engines and vehicles. On July 29, 2009, the Institute for Policy Integrity at the New York University School of Law

submitted a petition addressing fuels used in motor and nonroad vehicles and engines, and aircraft. On September 21,

2009, a coalition of environmental, animal welfare, and environmental justice groups submitted a petition requesting

EPA to promulgate new source performance standards for several air pollutants, including greenhouse gases, from new

concentrated animal feeding operations. Finally, on December 2, 2009, the Center for Biological Diversity and 350.org

submitted a petition requesting EPA to issue national ambient air quality standards for seven GHGs.

Each of these petitions asks EPA to make the requisite endangerment finding under the appropriate CAA section—

section 108, 111, 211, 213, or 231. These provisions are discussed further on in this part of the report. To date, EPA has

not responded to any of the petitions. Finally, EPA has received petitions under section 115, dealing with

endangerments in Canada owing to emissions in the United States. Because EPA does not recognize a petition process

under section 115, it has characterized these self-described petitions as “submittals.” The petitions/submittals under

section 115 of which CRS is aware have been rejected.

17

See, e.g., CAA § 126(b), 42 U.S.C. § 7426(b). The text paragraph restates a point made by Justice Scalia in his fourjustice dissent in Massachusetts. As he put it: “Where does the CAA say that the EPA Administrator is required to

[make a ‘judgment’ under 202(a)] whenever a rulemaking petition is filed? The Court points to no such provision

because none exists.” 549 U.S. at 550. The majority does not address the question, probably because EPA did in fact

render a formal decision on the petition in Massachusetts, denying it.

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The answer is that while courts afford federal agencies wide discretion as to whether to initiate a

rulemaking,18 the discretion is not without limit. The Administrative Procedure Act is the

touchstone: under section 553(e), each agency must give interested persons “the right to petition

for the issuance … of a rule,”19 which petition is subject to section 555(b)’s command that an

agency “within a reasonable time … proceed to conclude a matter presented to it.”20 If an agency

fails to heed these directives, section 706(1) empowers courts to “compel agency action

unlawfully withheld or unreasonably delayed.”21 The Supreme Court recently explained that an

APA section 706(1) claim can proceed only when an agency failed to take a discrete agency

action that it is required to take22—but petitions seeking EPA regulation of GHG emissions would

presumably argue that this is exactly what they are alleging. Moreover, these APA provisions

have been applied not only where an agency responds to a rulemaking petition by denying it, but

to instances such as those hypothesized here, where the agency refuses to respond at all.23 In sum,

a reviewing court likely would require EPA to respond—up or down—to a well-supported

petition for GHG regulation within a generous, but finite, period of time.

Given that EPA responds to the petition (or acts without petition), one issue that arises under

every non-202(a) endangerment provision is the effect of the generic component of the agency’s

202(a) finding. Recall that the generic component declared that GHGs already in the atmosphere

from all sources may, in combination, reasonably be anticipated to endanger public health or

welfare. Because non-202(a) endangerment provisions use identical language, arguably at least

the generic component of those provisions also must be deemed satisfied. This is an important

preliminary step in understanding the legal relevance of EPA’s 202(a) endangerment finding to

other endangerment-triggered sections of the CAA—but it is only a preliminary step. Beyond

this, as the following discussion shows, there are differences in the language surrounding the

endangerment provisions, and lower levels of GHG emissions from most non-section-202 source

categories. These differences, it would appear, generally give EPA leeway in deciding whether to

regulate GHGs from sources other than new motor vehicles, notwithstanding the 202(a) finding.

Following are the CAA endangerment provisions being debated as possibly authorizing, or even

mandating, EPA regulation of GHG emissions now that EPA has issued its 202(a) endangerment

determination.

Fuels and Fuel Additives

CAA section 211(c)(1)24 empowers EPA to regulate the manufacture, sale, or offering for sale, of

fuels and fuel additives for use in motor vehicles or nonroad engines or vehicles. The authority

comes into being when, in EPA’s judgment, any emission product of such fuel or fuel additive

triggers an endangerment provision identical to that in 202(a). Unlike section 202, which

18

As a leading commentator observes: “… courts have traditionally applied a highly deferential standard of review in

reviewing cases of agency inaction.” Jeffrey S. Lubbers, A GUIDE TO FEDERAL AGENCY RULEMAKING 542 (4th ed.

2006).

19

5 U.S.C. § 553(e).

20

Id. at § 555(b).

21

Id. at § 706(1).

22

Norton v. Southern Utah Wilderness Alliance, 542 U.S. 55, 63 (2004).

23

See, e.g., In re: American Rivers and Idaho Rivers United, 372 F.3d 413, 418 (D.C. Cir. 2004).

24

42 U.S.C. § 7545(c)(1).

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authorizes standards for emissions, section 211 speaks of standards for the composition of the fuel

that produces the emissions. Presumably because section 202 specifies only a final result, rather

than dictating how manufacturers are to achieve that result, it is “the preferred—although not the

mandatory—alternative under the statutory scheme.”25

Section 211(c)(1) arguably allows EPA to implement low-carbon fuel standards.26 However,

section 211(c)(1) states only that EPA “may” regulate if an endangerment finding is made—

unlike section 202(a), which directs that EPA “shall” regulate on such a finding. 27 Assuming that

“may” is used in the traditional sense of allowing full discretion, a 211(c)(1) endangerment

finding would not compel agency action against fuels and fuel additives. That being so, it is

unnecessary to address whether a “contributes to” component finding under 211(c)(1) would be

compelled by a comparable finding under 202(a).

National Ambient Air Quality Standards

CAA section 108(a)(1)28 contains endangerment language identical to that of 202(a) and might

provide a basis for regulating stationary sources of GHGs through national ambient air quality

standards (NAAQSs).

By way of background, NAAQSs are nationwide standards set by EPA that fix the maximum

concentration of a pollutant (or group of pollutants) allowed in ambient air.29 There are two types

of NAAQSs: primary NAAQSs to protect public health, and secondary NAAQSs to protect

public welfare. 30 Under the CAA, the path to establishing primary and secondary NAAQSs for an

air pollutant consists of three steps: (1) listing of the pollutant by EPA, which requires (2)

issuance by the agency of “air quality criteria” (documents summarizing the scientific

information about a pollutant’s effects—not, as “criteria” implies, standards), which, in turn,

requires (3) promulgation of the NAAQSs. States then are required to submit “implementation

plans” to EPA within three years to achieve and/or maintain the NAAQSs. 31 As a practical matter,

any concern that EPA may be forced by the 202(a) endangerment finding to promulgate NAAQSs

arises chiefly from primary, not secondary, NAAQSs. The reason: areas designated nonattainment

for a primary NAAQS must attain the NAAQS within five years from such designation; in

contrast, no fixed deadline is set for attainment of secondary NAAQSs.32

25

Ethyl Corp. v. EPA, 541 F.2d 1, 11 (D.C. Cir. 1976) (en banc).

Jameel Alsalam, Ctr. For Clean Air Policy, A Pragmatic Approach to Regulating Greenhouse Gases Under the

Clean Air Act 14 (2009), http://www.ccap.org/docs/resources/614/

Clean%20Air%20Act%20and%20GHGs_CCAP_March%202009.pdf.

27

Generally, unless the context indicates otherwise, the words “shall” and “may” in statutes are to be read in their

everyday sense of mandatory and permissive, respectively. See, e.g., Rastelli v. Warden, Metro. Correctional Center,

782 F.2d 17, 23 (2d Cir. 1986) (“The use of a permissive verb—‘may review’ instead of ‘shall review’—suggests a

discretionary rather than mandatory review process.”).

28

42 U.S.C. § 7408(a)(1).

29

Id. at § 7409(a). “Ambient air” is “that portion of the atmosphere external to buildings, to which the general public

has access.” 40 C.F.R. § 50.1(e).

30

See footnote 3 supra.

31

42 U.S.C. § 7410(a)(1).

32

Id. at § 7502(a)(2)(A)-(B).

26

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As the above shows, listing the pollutant is the critical first step—listing compels criteria, which

compel NAAQSs. So when is listing required? Section 108(a)(1) states that “for the purpose of

establishing NAAQSs,” the EPA Administrator “shall” publish a list of air pollutants (A) which

“cause or contribute to air pollution which may reasonably be anticipated to endanger public

health or welfare”; (B) which are emitted from “numerous or diverse mobile or stationary

sources”; and (C) “for which air quality criteria had not been issued before the date of enactment

of the Clean Air amendments of 1970, but for which he plans to issue air quality criteria under

this section.”33 The endangerment finding under section 202(a) arguably forces EPA at some point

to find condition (A) satisfied—the precise phrase “cause or contribute to air pollution which may

reasonably be anticipated to endanger public health or welfare” is found in both 108(a)(1) and

202(a), and 108(a)(1)’s reference to “contribute to air pollution” presumably includes the same

new motor vehicle emissions EPA just found to do so under 202(a). As for condition (B), that CO2

is emitted by “numerous and diverse mobile or stationary sources” seems hard to deny. But based

on the literal language, EPA could be expected to argue that condition (C) gives it discretion

whether to “plan[] to issue air quality criteria”—hence discretion not to promulgate a NAAQS.34

There is contrary authority denying such discretion, however. In NRDC v. Train,35 the Second

Circuit held that EPA could not use condition (C) to avoid setting a NAAQS for lead, once the

agency had recognized lead as satisfying conditions (A) and (B). To hold otherwise, said the

court, would render the 108(a)(1) language that EPA “shall” publish a list “mere surplusage,” and

allow EPA to bypass the rigid CAA deadlines for attaining air quality standards.36 Moreover, said

the court, “it is to the initial list alone [the one required to be published soon after enactment of

the 1970 CAA amendments] that the phrase ‘but for which he plans to issue air quality criteria’ is

directed.”37 Plainly, Train might be invoked by any party seeking to compel EPA to set NAAQSs

for GHGs following a positive endangerment finding for GHGs under section 202(a).

But Train does not settle the matter. Most significantly, the consequences of listing GHGs under

section 108(a), leading to NAAQSs for GHGs, are so awkward—some would say absurd—that

an argument arises that Congress could not have intended this result (assuming NAAQSs for

GHGs were set below current atmospheric concentrations38). For one thing, the state

implementation plans (SIPs) that would be required to achieve these NAAQSs would have an

impossible goal, since even a substantial reduction of GHG emissions in an air quality control

region likely would have little effect on ambient concentrations of GHGs. For this reason, a court

might well take seriously an argument that an endangerment finding under section 202(a) does

not force EPA to promulgate NAAQSs for GHGs. Courts tend to resist interpretations of statutes

that lead to impractical or absurd results.39

33

Emphasis added.

See ANPR, 73 Fed. Reg. at 44, 477.

35

545 F.2d 320 (2d Cir. 1976).

36

Id. at 325.

37

Id. at 325.

34

38

In particular, CAA section 109(b)(2) requires the “secondary” NAAQS to be set at a level that “protect[s] the public

welfare from any known or anticipated adverse effects.” (Emphasis added.) Since current atmospheric levels of GHGs

are already believed to be producing welfare effects, it would seem that the plain meaning of the CAA language

requires that a secondary NAAQS for GHGs be set lower than current concentrations. Under Whitman v. American

Trucking Ass’n, 531 U.S. 457 (2001), EPA may not consider costs of compliance in setting a NAAQS.

39

See, e.g., United States v. Turkette, 452 U.S. 576, 580 (1981) (in construing a statute, “absurd results are to be

avoided”). In Public Citizen v. U.S. Dep’t of Justice, 491 U.S. 440, 470 (1989), Justice Kennedy, writing in

(continued...)

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Other arguments undermining the present-day viability of NRDC v. Train can be conceived,

though each is debatable. First, Train dealt specifically with lead, which the Senate committee

report for the 1970 CAA explicitly expected would be the subject of a NAAQS.40 The Second

Circuit twice noted this explicit mention of lead in the Senate report. In contrast, there is no

legislative history indicating a congressional expectation of a NAAQS for GHGs, suggesting that

Train would have less force in this context.

Second, EPA notes in the ANPR that NRDC v. Train was decided before the Supreme Court’s

decision in Chevron U.S.A. Inc. v. NRDC.41 Chevron sets out the canonical statement of a key

judicial review principle: courts should defer to an agency’s interpretation of a statute it is

charged with administering.42 According to Chevron, if the statute is ambiguous or silent on a

point, a court is to ask only whether the agency’s interpretation is a “permissible” construction

thereof. 43 The reviewing court is not to substitute its own judgment for a permissible agency

construction, even if the agency’s interpretation is not the only reasonable one. EPA’s argument in

the ANPR, it appears, is that the Second Circuit might have deferred to EPA’s we-have-discretion

argument had the court written its decision post-Chevron. However, this argument overlooks the

fact that the deference principle was well established long before Chevron, and certainly by the

time of NRDC v. Train.44

Finally, one might ask why, if Congress always intended NAAQSs to be required once conditions

(A) and (B) are met, no new NAAQSs for a new criteria pollutant have been set since the 1970s.45

New or Modified Stationary Sources

CAA section 111(b)(1) commands EPA to issue new source performance standards (NSPSs) for

new or newly modified stationary sources of air pollution (principally, factories and power plants)

once it determines that a stationary source category “causes, or contributes significantly to, air

pollution which may reasonably be anticipated to endanger public health or welfare.” After EPA

establishes an NSPS for a pollutant from a new-source category, section 111(d) then requires each

state to submit to EPA a plan establishing standards of performance for existing sources of that

pollutant within the same source category—a major air pollution program in its own right. Note,

(...continued)

concurrence for himself and two other justices, noted that “[w]here the plain language of the statute would lead to

patently absurd consequences, that Congress could not possibly have intended, we need not apply the language in such

a fashion. When used in a proper manner, this narrow exception to our normal rule of statutory construction does not

intrude upon the lawmaking powers of Congress, but rather demonstrates a respect for the coequal Legislative Branch,

which we assume would not act in an absurd way.” (citations omitted; emphasis in original)

40

S Rep. No. 91-1196, at 11 (1970).

41

467 U.S. 837 (1984). See ANPR, 73 Fed. Reg. at 44,477 n.229.

42

Such deference has been held to be particularly appropriate in the case of “a statutory scheme as unwieldy and

science-driven as the Clean Air Act.” Appalachian Power Co. v. EPA, 135 F.3d 791, 801-802 (D.C. Cir. 1998).

43

467 U.S. at 843.

44

Indeed, in the same year as NRDC v. Train, the Supreme Court explicitly deferred to EPA’s interpretation of another

one of its statutes, the Clean Water Act. EPA v. California, 426 U.S. 200, 227 (1976).

45

The wording of the text sentence—“no new NAAQSs for a new criteria pollutant”—is meant to exclude revisions of

existing NAAQSs (see CAA § 109(d)(1)), the replacement of the “total suspended particulates” NAAQS with a PM10

NAAQS in 1987, and the promulgation of the PM2.5 NAAQS as a companion to the PM10 NAAQS in 1997.

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however, that section 111(d) state plans are not required for pollutants listed under section 108 for

eventual development of NAAQSs (see previous section).

Immediately plain is one reason why a 202(a) endangerment finding may not force EPA to

promulgate a GHG NSPS for most new source categories: the term “significantly” in 111(b)(1)

distinguishes that provision from 202(a). “Significantly” is not defined in the CAA, so EPA likely

has broad discretion to define it to exclude many stationary source categories. But while such

discretion is broad, it is not unlimited. EPA’s discussion accompanying its 202(a) endangerment

finding extensively documents the harm GHGs may have on the environment, and notes that even

GHG source categories that appear too small to matter in fact could be very significant

contributors in terms of both absolute emissions or in comparison to other similar source

categories. Such statements may limit EPA’s ability to define “significantly” so as to eliminate

entirely any obligation to deal with GHGs through NSPSs, especially for the higher-emitting

source categories. In particular, coal-fired power plants emitted 27.6% of total U.S. GHG

emissions in 200846—by most any measure a “significant” contribution. Thus, the generic

component of EPA’s 202(a) endangerment finding, in combination with a new source category

that is a “significant” contributor of GHGs, would seem to trigger an EPA duty to promulgate

NSPSs for that source category.

In the case of section 111, however, the bare duty to promulgate an NSPS for a new source

category’s GHGs is the minor part of the story. More important is the considerable discretion EPA

would have as to the precise content and applicability of that NSPS. For this reason, the agency is

likely to favor NSPSs for dealing with GHGs—that is, as long as it has to address GHGs under

the existing CAA. The discretion inheres first in the definition of NSPS, which directs EPA to

factor in the feasibility of reducing emissions with current technology, and the cost.47 In the

statute’s words, NSPSs must reflect the degree of emission reduction achievable through

the best system of emission reduction which (taking into account the costs of achieving such

reduction and any nonair quality health and environmental impact and energy requirements),

the [EPA] Administrator determines has been adequately demonstrated.48

The D.C. Circuit has interpreted this standard to mean that EPA should “identify the emission

levels that are ‘achievable’ with ‘adequately demonstrated technology’” (an undefined phrase

allowing EPA broad discretion) and then use its discretion “to choose an achievable emission

level which represents the best balance of economic, environmental, and energy

considerations.”49 Also, section 111(b)(2) allows EPA to “distinguish among classes, types, and

sizes within categories of new sources” in setting NSPSs, adding yet another layer of agency

discretion. In sum, even if the 202(a) endangerment finding leads to an NSPS being required for

GHGs emitted by some new source category, EPA’s latitude in formulating that standard makes it

unlikely the standard will be overly burdensome.

46

U.S. Energy Information Admin. (Department of Energy), EMISSIONS OF GREENHOUSE GASES IN THE UNITED STATES

2008 (2009). The 27.6% figure in the text was calculated by CRS from 2008 figures in Table 1 of the report, showing

total U.S. GHG emissions as 5,839.3 million metric tons of CO2 equivalent, and Table 11, showing coal-fired power

plant emissions as 1,945.9 million metric tons of CO2.

47

42 U.S.C. §§ 7411(a)(1) and (h).

48

Id. at § 7411(a)(1).

49

Sierra Club v. Costle, 657 F.2d 298, 330 (D.C. Cir 1981).

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At present, there are several active suits seeking to compel EPA promulgation of NSPSs for GHG

emissions from one or another stationary source category.50 Petitioners’ prospects in such suits

likely will be improved by EPA’s 202(a) endangerment finding.

Non-202(a) Mobile Sources of Air Pollution

Non-road Engines and Non-road Vehicles

CAA section 21351 applies to non-road engines and non-road vehicles, which include ocean-going

vessels, construction equipment, farm tractors, forklifts, and lawn and garden equipment. Under

213(a)(4), if EPA determines that any emissions from new non-road engines or vehicles

“significantly contribute to air pollution which may reasonably be anticipated to endanger public

health or welfare, the Administrator may promulgate ... such regulations as the Administrator

deems appropriate ... taking into account costs, noise, safety, and energy factors.” This contrasts

in three ways with section 202(a), which (1) requires, rather than merely allows,52 EPA to issue

regulations for (2) emissions that merely “contribute,” rather than “significantly contribute,” to air

pollution, and (3) lacks the discretion-enhancing phrase “as the Administrator deems

appropriate.” Thus EPA has great discretion in responding (or not responding) to GHG emissions

from the non-road category.

Aircraft Engines

CAA section 23153 authorizes EPA to establish emissions standards for aircraft engines. The

agency “shall, from time to time” propose such standards, once a 202(a)-identical endangerment

provision is satisfied. Plainly, a “contributes to” finding for new motor vehicles under 202(a) has

limited relevance to whether EPA must make a counterpart finding for a different source category,

like aircraft, that emits far less GHGs. The pivotal question is whether a “contributes to”

component finding may have to be made for aircraft anyway, independent of section 202(a), in

that whatever the quantity of GHG emissions from aircraft, it is not insignificant. A “contributes

to” component finding for aircraft GHGs combined with a “may reasonably be anticipated to

endanger” component finding carried over from section 202(a) will force EPA to make an overall

endangerment finding for aircraft. This argument may turn on the breadth of EPA’s authority to

set a de minimis threshold for the quantity of aircraft GHG emissions that is deemed to

“contribute to.”

What if an endangerment finding is made for aircraft GHG emissions? Unlike with 202(a), such a

finding under 231 does not automatically require regulations. Section 231(a)(2)(B)(ii) states that

EPA “shall not change the aircraft engine emissions standards” if doing so would “significantly

increase noise and adversely affect safety.”54 Section 231(c) states further that no regulation shall

apply if disapproved by the President following the Secretary of Transportation’s finding that EPA

50

See generally CRS Report RL32764, Climate Change Litigation: A Survey, by (name redacted).

42 U.S.C. § 7547.

52

See supra footnote 27 and accompanying text.

53

42 U.S.C. § 7571.

54

Id. at § 7571(a)(2)(B).

51

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regulations would create a hazard to aircraft safety.55 Also, “any regulation prescribed under

[section 231] ... shall take effect after such period as the Administrator finds necessary ... to

permit the development and application of the requisite technology, giving appropriate

consideration to the cost of compliance within such period.”56 Finally, even should standards be

compelled, section 231 is silent as to their form and stringency level (as under section 202(a)).

Noting these features, the D.C. Circuit has held that EPA enjoys broad discretion under section

231 in determining appropriate regulations for aircraft emissions in light of cost, technology, and

safety, and can subordinate emissions reduction to these other concerns. 57

Air Pollutants from the Loading and Unloading of Tank Vessels

CAA section 183(f)(1)(A)58 requires EPA to regulate “the emission of [volatile organic

compounds] and any other air pollutant from the loading and unloading of tank vessels”59 that

EPA finds “causes, or contributes to, air pollution that may be reasonably anticipated to endanger

public health or welfare.”60 Volatile organic compounds are not GHGs, but the phrase “any other

air pollutant” presumably includes methane, which is a GHG and may be released during the

loading and unloading of tank vessels. The same point made above under section 231 applies

here. To reiterate, a key question is whether a “may reasonably be anticipated to endanger”

component finding under 202(a) will force EPA to make an endangerment finding for loading and

unloading tank vessels given the argument that, however low relative to motor vehicles the GHG

emissions from such operations, they nonetheless demand a “contributes to” component finding.

The answer to this question, to reiterate, may turn on EPA’s discretion in setting a de minimis

threshold for the loading and unloading of tank vessels. Query whether the absence of the phrase

“in his judgment” in 183(f)(1)(A), if contrasted with the presence of the same phrase in section

202(a), may be read by a court to constrain the agency’s discretion under 183(f)(1)(A).

Even when promulgation of standards is compelled, EPA has discretion in other regards: section

183(f)(1)(A) does not explicitly specify the form and stringency of the required standards, and the

standards are to reflect broad parameters (reasonably available technology, environmental

impacts, energy requirements, and safety), as to which latitude of interpretation is inevitable.

Stratospheric Ozone Protection

CAA section 61561 chiefly seeks to protect stratospheric ozone, but its broad language extends to

all threats to the stratosphere. The section is included here because there are several scenarios

under which GHGs might affect the stratosphere.62

55

Id. at § 7571(3)(c).

Id. at § 7571(2)(b).

57

National Association of Clean Air Agencies v. EPA, 489 F.3d 1221, 1230 (D.C. Cir. 2007).

58

42 U.S.C. § 7511b(f)(1)(A).

56

59

CAA section 183(f)(1)(A) incorporates the definition of “tank vessel” in 46 U.S.C. § 2101(39). A tank vessel is a

vessel that carries hazardous material or oil in bulk, or is adapted to do so, and is (A) a vessel of the United States, (B)

operates in U.S. waters, or (C) transfers its good in a U.S. port or any other place subject to U.S. jurisdiction.

60

This endangerment provision lacks the “in his judgment” phrase found in CAA section 202(a).

61

42 U.S.C. § 7671n.

62

See CRS Report R40585, Climate Change: Potential Regulation of Stationary Greenhouse Gas Sources Under the

Clean Air Act, supra page 1, at 14.

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The wording of section 615 is a bit different from the foregoing endangerment provisions:

If, in the Administrator’s judgment, any substance, process, practice, or activity may

reasonably be anticipated to affect the stratosphere, especially ozone in the stratosphere, and

such effect may reasonably be anticipated to endanger public health or welfare, the

Administrator shall promptly promulgate regulations respecting the control of such

substance, process, practice, or activity.

This language presents several distinctions from section 202(a), indicating that a positive

endangerment finding under 202(a) would almost certainly not be found to compel EPA action

under section 615. In particular, section 615 speaks of an effect on the stratosphere that may

endanger public health or welfare, not, as does section 202(a), “air pollution” in the atmosphere

generally that may do so. Thus, the generic component finding under section 202(a) does not

dictate the comparable component finding here. For another thing, section 615 demands that the

“substance” may itself be expected to affect the stratosphere in a way that endangers public health

or welfare; section 202(a) sets a lower threshold, insisting only that the emissions “contribute to”

existing air pollution levels that, without regard to the contributing source, may be expected to

endanger. And as with some other endangerment provisions discussed in this memorandum,

section 615, should it be deemed to require regulations, says nothing explicit as to their form or

stringency.

Pollution in a Foreign Country Caused by Emission Sources in the

United States

Under CAA section 115, “[w]henever the [EPA] Administrator, upon receipt of reports … from

any duly constituted international agency has reason to believe that any air pollutant or pollutants

emitted in the United States cause or contribute to air pollution which may reasonably be

anticipated to endanger public health or welfare in a foreign country,” it must notify the

governors of the states where the emission originates.63 The same result, EPA notification of

states, is required when the U.S. Secretary of State “alleges” such an endangerment and requests

EPA to so notify. The notified states must then revise their state implementation plans “to prevent

or eliminate” the endangerment being caused in the foreign country, but only if EPA finds that the

same rights are granted to the United States by the country affected. 64

Unlike other CAA provisions, section 115’s endangerment provision imposes no requirement that

EPA determine whether the air pollutant endangers public health or welfare in the United States.

At first blush, therefore, one might conclude that a section 202(a) endangerment finding, based on

effects in the United States, has no relevance to section 115, based on foreign effects. However,

given the near uniformity of worldwide atmospheric concentrations of GHGs,65 a positive 202(a)

finding for the United States, which necessarily includes a “may reasonably be anticipated to

endanger” finding for the United States, seems to compel the same component finding for any

foreign country. As for the “contributes to” component finding, the question arises whether such

63

42 U.S.C. § 7415(a) (emphasis added). A comparable provision for abatement of water pollution in the United States

causing endangerment in a foreign country is found at Clean Water Act section 310, 33 U.S.C. § 1320.

64

See Peter Tsirigotis, Discussion of Clean Air Act Authorities and GHGs, available at http://www.epa.gov/air/caaac/

pdfs/2008_01tsirigotis.pdf (Jan. 31, 2008).

65

With respect to the principal GHG, CO2, see Japan Meteorological Society, Carbon dioxide (CO2) distribution

(updated May 20, 2009), available at http://ds.data.jma.go.jp/ghg/kanshi/info_kanshi_e.html.

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finding is to be made for the United States overall, or for individual states. The former seems the

better reading of section 115, given that the section speaks of pollutants emitted “in the United

States” and refers to supporting studies by a “duly constituted international agency.” In either

event, EPA, upon making an endangerment finding and reciprocity finding respecting a foreign

country, would be required to notify and demand implementation plan revisions from many,

probably most, states.

As with setting NAAQSs for GHGs, the consequences of a section 115 endangerment finding

(assuming reciprocity) are extremely awkward, and for the same reason. Again, the compelled

EPA action would be a demand that many or even most state implementation plans be revised “to

prevent or eliminate” the foreign endangerment. As discussed under the NAAQSs section of this

report, such an ambitious result is likely unattainable, even assuming substantial reductions of

GHG emissions in every plan-revising state, owing to the staggering number of GHG sources

worldwide that contribute to the endangerment in the foreign country. Thus, with section 115 as

with the CAA’s NAAQS sections, EPA may search for a plausible interpretation of the statutory

language that could avoid such consequences and the courts may be receptive.

Several such interpretations may be noted, though it must be stressed that they are of varying

degrees of legal persuasiveness and have mostly not been tested in court. The first, noted by EPA

in its ANPR, is that section 115 can only be used to require states to incorporate into their

implementation plans measures related to attainment and maintenance of NAAQSs.66 EPA’s

argument appears to be founded on section 115’s statement that following an endangerment

finding, EPA’s notice to a state “shall be deemed to be a finding under section 110(a)(2)(H)(ii) …

which requires a plan revision with respect to so much of the applicable implementation plan as is

inadequate to prevent or eliminate the endangerment.”67 Implementation plans are required to be

prepared by states under section 110 to achieve and maintain NAAQSs,68 and 110(a)(2)(H)(ii)

states one of the required elements in such plans. Thus, EPA apparently concludes, section 115,

being dependent on 110(a)(2)(H)(ii) for effectuation, likewise must be confined to measures

related to attainment and maintenance of NAAQSs. If this argument is upheld, EPA might be able

to avoid using section 115 if it can avoid setting a NAAQS for GHGs under section 110.

The vulnerability of EPA’s argument, however, is that contrary to EPA’s position, the text of

section 110(a)(2)(H)(ii) appears to reach beyond measures related to attainment and maintenance

of NAAQSs. Section 110(a)(2)(H)(ii) explicitly requires that implementation plans provide for

plan revision when EPA finds that “the plan is substantially inadequate to attain the [NAAQS]

which it implements or to otherwise comply with any additional requirements established under

this Act.”69 Section 115’s command that an EPA-notified state revise its plan to eliminate the

endangerment would seem to be precisely such an “additional requirement[].” Moreover, that

requirement applies under 115(a) to “any” air pollutant emitted in the United States, not just those

that affect attainment and maintenance of NAAQSs.

66

73 Fed. Reg. at 44,482-44,483. See also Letter from Brian J. McLean, Director of EPA Office of Atmospheric

Programs, to Albert Koehl, Ecojustice Canada, dated February 29, 2008 (rejecting petition for section 115

endangerment finding based on, among other U.S.-emitted pollutants, CO2).

67

42 U.S.C. § 7410(a)(2)(H)(ii). The complementary CAA provision is section 110(k)(5): “Whenever the

Administrator finds that the applicable implementation plan for an area is substantially inadequate to attain or maintain

the relevant [NAAQS] … or to otherwise comply with any requirement of this Act, the Administrator shall require the

state to revise the plan as necessary to correct such inadequacies.” (Emphasis added.)

68

Id. at § 110(a)(1).

69

Emphasis added.

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A corollary to EPA’s argument that 110(a)(2)(H)(ii) is limited to NAAQS-related measures is its

stance that owing to the unavailability for GHGs of state notification and plan revision under

110(a)(2)(H)(ii), it is inappropriate for EPA to make the endangerment finding that sets that

process in motion. This argument stems from the EPA view, endorsed by the D.C. Circuit, that

section 115 establishes a single, unitary procedure. 70 That is, either both endangerment finding

and notification/plan-revision occur, or neither does.

Still other arguments that would thwart judicial coercion of EPA action under section 115 are (1)

that in contrast with the CAA section on interstate pollution, section 115 says nothing about

allowing petitions and so they should be assumed unavailable, 71 and (2) that the text of section

115 (“Whenever” the Administrator “has reason to believe”) implies a degree of discretion as to

the endangerment finding.72

Part Four: CAA Sections Having No Endangerment

Trigger

New Source Review in PSD Areas

Possibly the strongest arguments that a positive endangerment finding for new motor vehicle

GHG emissions, and resulting standards, will compel EPA to act against other GHG sources is

based on new source review in Prevention of Significant Deterioration (PSD) areas and on Title V

permitting (discussed in the following section). EPA fully accepts this argument:

EPA expects soon to promulgate regulations under the CAA to control GHG emissions

[from new motor vehicles] and, as a result, trigger PSD and Title V applicability

requirements for GHG emissions.73

As background, an area of the country is PSD for a pollutant if that area is either attaining the

health-based NAAQS for that pollutant or there is insufficient information to determine whether

the area is attaining that standard (“unclassifiable areas”).74 The PSD portion of the CAA seeks to

ensure that air quality in such areas—air that is or may be “cleaner than clean”—not be allowed

to deteriorate down to the minimum acceptable level in the NAAQSs. To ensure this does not

happen, the PSD program acts preventively; it requires EPA or states with approved PSD

programs to review in advance of construction any new major emitting facilities, or major

modifications of existing facilities, proposed for the PSD area.75 This is termed “new source

review.” As part of this review, the owner or operator of the proposed facility must show, for

70

Her Majesty the Queen in Right of Ontario v. U.S. EPA, 912 F.2d 1525 (D.C. Cir. 1990).

71

EPA makes this argument in the McLean letter, supra footnote 66, where the agency pointedly referred to the section

115 petition as a “submittal.” The argument, however, seems to overlook the Administrative Procedure Act sections

noted earlier in this report. See text accompanying notes 19-21 supra. Presumably EPA thinks of submittals as not

triggering a duty to respond.

72

Ontario, 912 F.2d at 1533.

73

Prevention of Significant Deterioration and Title V Greenhouse Gas Tailoring Rule, 74 Fed. Reg. 55,292, 55,292

(October 27, 2009) (proposed rule). Emphasis added.

74

CAA § 161; 42 U.S.C. § 7471.

75

CAA§ 165; 42 U.S.C.§ 7475.

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example, that emissions from the facility will not cause or contribute to more than one

exceedance per year of the maximum allowable increase in concentration for any pollutant.76

“Major emitting facility” is statutorily defined as any facility on a long statutory list (including

large fossil-fuel-fired power plants) that has the potential to emit 100 tons/year of any air

pollutant, and any stationary source in an unlisted category with the potential to emit 250

tons/year of any air pollutant.77

Since the PSD program is triggered by an area’s being cleaner than a NAAQS requires, one might

suppose it has no relevance to any pollutant for which there is no NAAQS—such as, so far,

GHGs. But the CAA’s PSD provisions cast a wider net. To be sure, an area can be designated

PSD only in connection with a NAAQS air pollutant. But once so designated, the statute

stipulates that “the proposed facility is subject to the best available control technology for each

pollutant subject to regulation under this Act emitted from … such facility.”78 The Supreme Court

has held that GHGs are “air pollutants” under the CAA, but what does “subject to regulation

under this act” mean? Did CO2 become “subject to regulation” when EPA promulgated

regulations in 1993 to require monitoring and reporting of CO2 emissions,79 as required by section

821 of the 1990 CAA amendments? Or later, in 2007, when the Supreme Court held that GHGs

are “air pollutants”? Or still later, only when EPA promulgates an emission standard actually

regulating CO2 emissions from some source—such as the expected section 202 standard? In

short, what event triggers the requirement of best available control technology (BACT) in PSD

areas?

Much ink has been spilled over the meaning of “subject to regulation under this Act.” Indeed, the

phrase has been the topic of at least two EPA Environmental Appeals Board decisions and one

EPA Administrator memorandum. 80 While the appeals board decisions have remanded the

question to EPA regional offices for further consideration, the Administrator’s memorandum

adopts the narrowest possible reading of “subject to regulation.” According to the memorandum,

issued at the end of the Bush Administration, the phrase excludes pollutants for which EPA

regulations only require monitoring and reporting, and includes only pollutants covered by an

“actual control of emissions” of the pollutant under the CAA or its regulations. In 2009, EPA

granted reconsideration of the Administrator’s memorandum and has recently sought comment on

the memorandum’s interpretation and other interpretations of “subject to regulation.”81 But the

dispute is likely to be moot soon, at least as to GHGs. Even under the narrow EPA interpretation,

the agency’s expected GHG standard for new motor vehicles in early 2010 will make certain

GHGs “subject to regulation under this Act,” and so trigger PSD/BACT for significant new

sources of those pollutants.

A PSD/BACT requirement for CO2 raises a problem, however, owing to the low 100/250

tons/year thresholds for applicability of the PSD program—recall the definition of “major

76

CAA § 165(a)(3); 42 U.S.C. § 7475(a)(3).

CAA§ 169(1); 42 U.S.C. § 7479(1).

78

CAA § 165(a)(4); 42 U.S.C. § 7475(a)(4). Emphasis added. See also CAA § 169(3); 42 U.S.C. § 7479(3).

79

40 C.F.R. Part 75.

80

Memorandum from Stephen L. Johnson, EPA Administrator, to EPA Regional Administrators, regarding “EPA’s

Interpretation of Regulations that [sic] Determine Pollutants Covered By Federal Prevention of Significant

Deterioration (PSD) Permit Program,” Dec. 18, 2008.

81

74 Fed. Reg. 51,535 (October 7, 2009). EPA identifies the current interpretation of “subject to regulation,” from the

Bush Administration, as the “current and preferred interpretation.” 74 Fed. Reg. at 51,535.

77

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emitting facility” in the second paragraph of this section. Carbon dioxide is emitted in far greater

amounts than any other air pollutant, so based on the statutory 250 tons/year threshold, hospitals,

churches, schools, and other relatively minor sources may be covered. Besides the considerable

pollution-control costs for small entities, coverage of such a vast number of sources, with a caseby-case determination of BACT for each source,82 also raises questions of administrative

practicality for state permitting authorities. To alleviate these problems, EPA has recently

proposed a “tailoring rule” to tailor the tons/year thresholds of PSD new source review to federal

and state administrative realities—in particular, to raise them substantially and thereby greatly

reduce the number of covered sources.83 The rule would depart, at least temporarily, from the

explicit 100 or 250 tons/year threshold in the CAA. As described by EPA—

The first phase, which would last 6 years, would establish a temporary level for the PSD and

Title V applicability thresholds at 25,000 tons per year (tpy) on a “carbon dioxide

equivalent” (CO2e) basis, and a temporary PSD significance level for GHG emissions of

between 10,000 and 25,000 tpy CO2e. EPA would also take other streamlining actions during

this time. … EPA would conduct another rulemaking, to be completed by the end of the sixth

year, that would promulgate, as the second phase, revised applicability and significance level

thresholds and other streamlining techniques.84

Of course, an agency’s departure from the express and unequivocal language of a statute, as EPA

proposes here, is something courts do not condone lightly—though it is another question entirely

whether any group would want to file suit against the tailoring rule, and who would have standing

to sue. 85 In any event, EPA goes to some effort in the preamble to the proposed tailoring rule to

provide legal justification—citing two related, but independent, lines of analysis it terms the

doctrines of “absurd results” and “administrative necessity.” These lines of analysis apply both to

PSD/new source review and Title V permitting, and so are discussed in a separate section of this

report following the upcoming section on Title V.

BACT is defined in the CAA, but in a manner that leaves the permitting authority (EPA or the

state) wide latitude in applying the requirement to a specific emission source.86 That latitude is

82

The CAA requires that BACT for a source be determined by the permit-issuing authority (the state or EPA) on a

“case-by-case basis.” CAA § 169(3); 42 U.S.C. § 7479(3).

83

Prevention of Significant Deterioration and Title V Greenhouse Tailoring Rule, 74 Fed. Reg. 55,292 (October 27,

2009).

84

Id. at 55,292. The threshold of 25,000 tpy relates solely to new major emitting facilities. “PSD significance level,” on

the other hand, relates solely to modifications of existing sources. As noted, only those modifications that are “major”

trigger EPA new source review. (The qualifier “major” is not in the CAA; it was added by EPA regulation—see 40

C.F.R. § 52.21(a)(2)(ii)). To be major, a modification must increase the emissions from a source by at least an EPAdefined “PSD significance level.” 40 C.F.R. §§ 52.21(b)(2)(i), 52.21(b)(40), 52.21(b)(23).

85

It is likely that the additional GHGs emitted by virtue of the temporarily raised tons/year threshold in the tailoring

rule would be insufficient to constitute the “injury in fact” required for standing to sue in federal courts. Speculating,

however, it may be imagined that an environmental group might claim standing by arguing that its members were

injured by the non-GHG emissions that would not have occurred had the statutory 100/250 tons/year threshold been

applied. This argument is based on the fact that BACT for GHGs will also, at many sources, reduce non-GHGs as well.

A second group that might have standing are industries that emit more than the 25,000 tons/year threshold in the

tailoring rule, who could conceivably argue they are at an economic disadvantage to their competitors below the 25,000

tons/year threshold in the rule.

86

CAA § 169(3); 42 U.S.C. § 7479(3).

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less, however, if EPA has an NSPS for the pollutant in question, since BACT can never result in

emissions greater than allowed under an NSPS, if one exists.87

Title V Permitting

CAA title V, added by amendment in 1990, creates an operating permit program applicable to

every “major” stationary source (existing and new), and certain other stationary sources, of air

pollution. 88 However, the Title V permit program imposes no substantive requirements of its own.

Rather, the purpose of a Title V permit is to consolidate in one place the requirements imposed on

the source elsewhere in the CAA, thus simplifying the regulation of each source and the

enforcement of such regulations by EPA, states, and citizen suits.

While imposing no new emission controls, Title V does impose costs on the applicant. For

example, as part of the application process, covered facilities must identify all federally

enforceable emission regulations (plus monitoring and recordkeeping requirements), including

those in state implementation plans, and develop a compliance plan. Once the permit is received,

the facility must monitor compliance and report the results to federal and state authorities at least

every six months. Certain changes in facility operations require a formal Title V permit

modification, at times a burdensome process. Finally, payment of permit fees is required, such

fees to be not less than $25 per ton of regulated pollutant, with exceptions.89 On the other hand,

the act does seek to ameliorate these costs. For example, Title V authorizes states to issue

“general permits” covering “numerous similar sources.”90 Facilities can then submit a simple

application seeking coverage under the general permit.

The general threshold for coverage by Title V is that the facility directly emits, or has the

potential to emit, 100 tons per year or more of any air pollutant. Such a low threshold would

extend Title V permitting requirements to many stationary sources of GHGs that in addition fall

under CAA emission requirements. In particular, a BACT requirement for GHG emissions in

PSD areas, discussed above under New Source Review in PSD Areas, would require new major

emitting facilities and major modifications in such areas to seek Title V permits.

As noted in the preceding section, the arguments made by EPA as to absurd results and

administrative necessity are invoked as well by the agency for narrowing the application of Title

V permitting. However, if the only CAA restrictions on stationary source GHGs are those under

PSD new source review, the thresholds under that program will completely set the scope of Title

V permitting.

87

88

Id.

CAA §§ 501-507; 42 U.S.C. §§ 7661-7661f.

89

CAA § 502(b)(3)(B)(i); 42 U.S.C. § 7661a(b)(3)(B)(i). As pertinent to GHGs, “regulated pollutant” is defined to

include each pollutant regulated under section 111 (NSPSs) and each pollutant for which a primary NAAQS has been

promulgated.

90

CAA § 504(d); 42 U.S.C. § 7661c(d).

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“Absurd Results” and “Administrative Necessity”

EPA has sought to legally justify its departure from the tons/year thresholds stated by the CAA for

PSD/new source review and Title V permitting by what it terms the “doctrines” of “absurd

results” and “administrative necessity.” These doctrines are discussed in detail in the preamble to

the proposed tailoring rule, noted in the New Source Review in PSD Areas section of this

report.91

The “absurd results” doctrine, supported by many court decisions, holds that even clear and

explicit statutory directives may on rare occasion have to be departed from when rigid adherence

would be inconsistent with other provisions of the statute or unambiguous legislative history, or

produce a result so contrary to sensible policy as to permit the inference that Congress could not

have intended that result. EPA asserts in the preamble to the proposed tailoring rule that

adherence to the 100/250 tons/year threshold for new source review in PSD areas would have

precisely this result:

the extraordinary increases in PSD and Title V permit applications that would result from a

literal application of the 100/250 tpy threshold requirements would, at least during the near

term—until EPA and the permitting authorities can develop streamlining methods and ramp

up resources—extensively disrupt the two permitting programs and impose undue regulatory

burdens in the aggregate on the sources newly subject to PSD and Title V permit

requirements.

As a concrete example, EPA asserts that during the initial period of literally applying the 100/250

tons/year threshold, permit applications would increase by 150-fold, “render[ing] it impossible

for permitting authorities to meet the requirement in CAA section 165(c) to process permit

applications within 12 months.”92

From EPA’s early years comes another example of courts endorsing an EPA effort to avoid a

seemingly senseless consequence of a literal statutory reading. During the 1970s, EPA adopted

the position that the National Environmental Policy Act (NEPA) does not require EPA to do

environmental impact statements, despite the fact that the act unequivocally makes its impactstatement directive applicable to “all agencies of the Federal Government.”93 The courts agreed

with EPA, affirming the agency’s rationale that it would be senseless to do environmental impact

statements per NEPA command when the decision-making processes followed by EPA under its

program statutes incorporate the very same environmental considerations and public participation

as NEPA.94 This may be regarded as an early and successful use of something akin to an absurd

results principle.

In sum, if courts agree with EPA that the burdens imposed by a literal reading of the PSD and

Title V thresholds would be crushing, it is quite plausible they would accept an EPA “absurd

results” defense in any litigation attacking the tailoring rule. This is particularly so because EPA is

91

74 Fed. Reg. at 53,303-53,311 (absurd results doctrine); 74 Fed. Reg. at 53,311-53,318 (administrative necessity

doctrine).

92

42 U.S.C. § 7475(c).

93

42 U.S.C. § 4332(2) (emphasis added).

94

See, e.g., State of Wyoming v. Hathaway, 525 F.2d 66, 71-72 (10th Cir. 1975). The question of NEPA’s application

to EPA was resolved, to some extent, by amendments to the Clean Air Act and Clean Water Act expressly exempting

the agency from NEPA’s impact statement requirement.

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Endangerment Finding for New Motor Vehicle Greenhouse Gas Emissions

not proposing a permanent exemption from the PSD and Title V thresholds, but rather a

temporary phase-in period (though courts may want to revisit the EPA threshold when the agency

makes its six-year adjustment in the threshold, as it promises to do). On the other hand, it must be

noted that in the sheer magnitude of its consequences, the statutory departure in the proposed

tailoring rule is greater than that in any of the “absurd results” cases with which CRS is familiar.95

The second, independent legal justification offered by EPA for its tailoring rule is the “doctrine”

of “administrative necessity.” This principle also has some support in the case law. As its name

suggests, it authorizes an agency to depart from statutory commands when literal compliance is

administratively impossible, or nearly so. To a considerable extent, administrative necessity and

absurd results overlap. EPA strenuously argues in the proposed tailoring rule’s preamble that the

statutory PSD threshold (together with a “zero” significance level threshold for modifications to

existing sources) “would result in a volume of permit applications that is so high that the PSD …

program[] would become impossible for State and Federal authorities to administer.” Only if EPA

can convince a court of such daunting burdens will the tailoring rule survive judicial review

(again, if review is sought).

In the leading case on administrative necessity, Alabama Power Co. v. Costle,96 the D.C. Circuit

was also dealing with EPA, and, by coincidence, the PSD requirements of the CAA. While

rejecting EPA’s expansion of a statutory exemption, the court conceded that

limited grounds for the creation of exemptions are inherent in the administrative process, and

their unavailability under a statutory scheme should not be presumed save in the face of the

most unambiguous demonstration of congressional intent to foreclose them.97

The court stressed, unsurprisingly, that “[c]ategorical exemptions from the clear commands of a

regulatory statute, though sometimes permitted, are not favored.”98 Yet, it added, “[t]his broad

principle that frowns upon categorical administrative exemptions is strict, but not absolute.”99 It is

possible that here, where EPA would have to apply the PSD program to a pollutant (CO2) emitted

in far larger quantities than the pollutants for which the CAA was designed, EPA may be able to

meet the demanding judicial prerequisites for invoking administrative necessity.

Finally, EPA has proposed that its phased approach to reaching the statutory thresholds may be

justified by case law for the proposition that agencies may proceed in an incremental fashion in

implementing a statutory mandate. EPA concedes that these cases are grounded on facts that are

distinguishable from the tailoring rule situation, and solicits comment as to whether the case law

is truly supportive of the proposed tailoring rule. 100

95

Some industry groups have argued that EPA should defer promulgating section 202 GHG emissions standards so as

to postpone triggering PSD/BACT for GHG emissions. This, of course, would avoid the problem of unrealistic

statutory thresholds entirely.

96

636 F.2d 323 (D.C. Cir. 1979).

97

Id. at 357.

98

Id. at 358.

99

Id. at 358.

100

74 Fed. Reg. at 55,319.

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Endangerment Finding for New Motor Vehicle Greenhouse Gas Emissions

Part Five: Final Thoughts

EPA’s endangerment finding for new motor vehicle GHG emissions, or the emission standards

that must follow, appears to force certain regulatory actions by EPA, leave the agency free to

resist certain other regulatory actions if it chooses, and leave two additional regulatory authorities

in a gray area in between.

Into the first category—forced regulatory action—appears to fall new source review of major

emitting facilities and major modifications of existing facilities in PSD areas. Final motor vehicle

GHG standards, expected by March, 2010, will necessarily mean that GHGs from new stationary

sources that emit more than some threshold amount of any pollutant (100 or 250 tons/year under

the CAA; 25,000 tons/year if the proposed tailoring rule is finalized), and GHGs from major

modifications of existing facilities, will be subject to BACT in such areas. BACT, however, is

loosely defined, particularly if there is no NSPS for the pollutant to set a floor on BACT. Title V

permitting requirements likely will be triggered as well. Further, stationary source categories that

emit large quantities of GHGs may have to be regulated by NSPSs, though the CAA gives EPA

wide latitude in shaping such regulations.

The second category—EPA retains discretionary latitude—appears to include almost all the

endangerment-triggered action authorities under the CAA. These can be distinguished in varying

degrees from section 202(a) on the grounds that, unlike section 202(a), some of them use the

discretionary “may,” some demand that the source category contribute “significantly” to the

endangerment, and some add additional preconditions. Most of these non-202(a) CAA authorities

involve source categories whose GHG emission levels are lower than from new motor vehicles,

meaning that a “contribute to” finding under section 202(a) may not dictate the same finding

under that other authority. Stationary source categories that do not emit large amounts of GHGs

will not have to be covered by NSPSs if EPA defines “significantly” at a high tons/year level.

The third category—the gray area between EPA being forced to act and not being forced to do

so—appears to comprise promulgation of NAAQSs for GHGs under section 108 and international

pollution abatement under section 115. These sections can be read to force EPA action, but there

would appear to be wiggle room for agency interpretation given the awkward consequences and

unattainable pollution-control goals such a reading could entail. The administrative necessity and

absurd results arguments presented so vigorously by EPA in connection with PSD new source

review and Title V permitting may be available to the agency here as well.

Ultimately whether EPA acts against GHG emissions under CAA provisions in the second and

third categories is likely to be a function of the agency’s (and Administration’s) political desires

more than anything else. The EPA under the Obama Administration has repeatedly stated that it is

willing to take on GHG emissions through CAA regulation if Congress does not soon enact

comprehensive climate change legislation reducing such emissions. There are several possible

motivations for the agency’s saying this: CAA regulation by the agency in the near future (1)

ensures that time is not lost in abating the causes of climate change while Congress debates; (2)

buttresses our credibility in international climate change negotiations (such as Copenhagen) by

showing that the United States is “serious” about tackling climate change; and (3) puts pressure

on Congress to enact climate change legislation.

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Endangerment Finding for New Motor Vehicle Greenhouse Gas Emissions

Author Contact Information

(name redacted)

Legislative Attorney

[redacted]@crs.loc.gov, 7-....

Congressional Research Service

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