Sierra Club v. EPA

Feb 25: In the U.S. Court of Appeals, Sixth Circuit, Case No. 07-4485. According to the summary provided by the Sixth Circuit in its opinion, the Clean Air Act requires the U.S. EPA to object to an air-pollution permit if any person “demonstrates” to the EPA “that the permit is not in compliance” with the Act’s requirements. 42 U.S.C. § 7661d(b)(2). In August 2006, the Sierra Club petitioned the EPA Administrator to object to a permit issued by the Kentucky Division of Air Quality to the East Kentucky Power Cooperative, claiming it had “demonstrate[d]” non-compliance because the EPA previously had issued a notice of violation to the same company (about the same plant) in January 2003 and had filed a federal-court complaint against the same company (about the same plant) in January 2004.

The Appeals Court said, "The EPA declined to object. Because it reasonably interpreted § 7661d(b)(2) to mean that the agency may alter its position about a power plant’s compliance with the Act based on intervening events and because the Sierra Club does not challenge the impact of these intervening events on the power plant’s compliance with the Act, we deny the petition for review."

This case arises from the power company’s request for a renewal of its Title V permit for one of the coal-powered steam generators, known (not so descriptively) as Unit 2, at the Spurlock Station power plant in Maysville, Kentucky. The Kentucky agency granted the permit in 1999. In 2003, apparently after discovering these changes to the plant, the EPA issued a notice of violation, informing the company that its Unit 2 permit failed to address the PSD requirements stemming from these modifications.

In August 2006, the Sierra Club petitioned the EPA to object to the permit, arguing (as it did in its comments to the state agency) that the proposed permit was deficient because it failed to address the PSD requirements. In support, the Sierra Club relied solely on the fact that the EPA previously had issued a notice of violation and had filed a civil-enforcement action based on the same allegations.

In August 2007, while the parties waited for the district court to approve the consent decree, the EPA reached a decision on the Sierra Club’s petition. Although it granted the petition in part (on an unrelated issue), it declined to object to the power company’s failure to address the PSD requirements. Acknowledging its prior notice of violation and enforcement action, the EPA explained that they were “initial steps” in the enforcement process and did not reflect the agency’s final position as to whether the Title V permit for Unit 2 needed to include a PSD compliance schedule.

The Appeals Court said, "The question is this: Does the Act require the EPA to object to a permit request when the agency previously has filed a notice of violation and enforcement action regarding the same allegations about the same plant? The answer turns on the meaning of a statute that the EPA administers and thus turns on an application of the familiar Chevron framework. Unless the statute’s terms “directly address[] the precise question at issue,” Chevron says that we must defer to the EPA’s “reasonable” interpretation of the provision. Chevron, USA, Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 843–44 (1984). . .

"Under these circumstances, the EPA acted within its authority in addressing the Sierra Club’s objection. Consistent with Chevron, the EPA reasonably construed § 7661d(b)(2) to mean that a prior notice of violation and enforcement action did not by themselves require it to object to a permit request. And consistent with the APA, the EPA did not arbitrarily or capriciously deny the Sierra Club’s request, after accounting not only for the agency’s prior actions but also for developments in that litigation."

Access the complete opinion (click here).