Sierra Club v. U.S. EPA

Jan 22: In the U.S. Court of Appeals, D.C. Circuit, Case No. 10-1413. On Petition for Review of Final Actions of the United States Environmental Protection Agency.

 

    The Appeals Court explains that in October 2010, U.S. EPA issued a final rule establishing regulations for particulate matter less than 2.5 micrometers (PM2.5) under § 166 of the Clean Air Act (the Act), 42 U.S.C. § 7476. See Prevention of Significant Deterioration (PSD) for Particulate Matter Less Than 2.5 Micrometers (PM2.5) -- Increments, Significant Impact Levels (SILs) and Significant Monitoring Concentration (SMC), 75 Fed. Reg. 64,864 (Oct. 20, 2010). In this rule, the EPA established Significant Impact Levels (SILs) and a Significant Monitoring Concentration (SMC) for PM2.5, screening tools the EPA uses to determine whether a new source may be exempted from certain requirements under § 165 of the Act, 42 U.S.C. § 7475. 75 Fed. Reg. at 64,890– 91, 64,895. Petitioner Sierra Club seeks review of this regulation.

 

    After the Sierra Club filed its petition, the EPA acknowledged that portions of the rule establishing SILs did not reflect its intent in promulgating the SILs, and now requests that we vacate and remand some (but not all) parts of its PM2.5 SIL regulations. The Appeals Court indicated that, "Notwithstanding the EPA's concession, the Sierra Club maintains that the EPA lacks authority to establish SILs and requests that we rule accordingly. The Intervenor, Utility Air Regulatory Group (UARG), on the other hand, urges us to uphold the SIL provisions EPA established, or alternatively, to remand the SIL provisions without ordering that they be vacated."

 

    The Appeals Court said, "Although the EPA conceded that it needs to revise some of the SIL provisions, it continues to assert that the portions of its rule establishing the SMC were valid. For the reasons stated below, we accept the EPA's concession on the SILs, and vacate and remand some portions of the EPA's rule establishing SILs. We further conclude that the EPA exceeded its authority in establishing the SMC, and grant the Sierra Club's petition as to those portions of the EPA's rule."

 

    The Appeals Court explains further that, "After the Sierra Club filed its petition, the EPA acknowledged that portions of the rule establishing SILs did not reflect its intent in promulgating the SILs, and now requests that we vacate and remand some (but not all) parts of its PM2.5 SIL regulations. Notwithstanding the EPA's concession, the Sierra Club maintains that the EPA lacks authority to establish SILs and requests that we rule accordingly. . .

 

    "Despite the EPA's concession, the Sierra Club asserts that vacatur and remand, while warranted, does not fully resolve its challenge, and asks that we determine whether the EPA has authority to promulgate SILs. We disagree with the Sierra Club that it is necessary to decide the EPA's authority to promulgate SILs at this point. To do so would require that we answer a question not prudentially ripe for determination. On remand the EPA may promulgate regulations that do not include SILs or do include SILs that do not allow the construction or modification of a source to evade the requirements of the Act as do the SILs in the current rule. In such an event, we would not need to address the universal disallowance of all de minimis authority. If the EPA promulgates new SIL provisions for PM2.5 and those provisions are challenged, we can then consider the lawfulness of those SIL provisions."

 

    Further, the Appeals Court rules, "We are not now ruling on the methodology the EPA used to determine the SILs. Instead, we are vacating and remanding §§ 51.166(k)(2) and 52.21(k)(2) based on the EPA's lack of authority to exempt sources from the requirements of the Act. Therefore, vacatur and remand of § 51.165(b)(2) is not necessary at this point. Accordingly, we vacate and remand the portions of the EPA's rule regarding SILs, with the exception of those portions codified in 40 C.F.R. § 51.165(b)(2). . .

 

    "We disagree with the EPA that the Sierra Club's petition is time-barred, and we agree with the Sierra Club that the EPA did not have de minimis authority to promulgate the SMC because we hold Congress was "extraordinarily rigid" in mandating preconstruction air quality monitoring. . ."

 

    Finally, the Appeals Court concludes, ". . .we vacate and remand to the agency for further consideration the portions of the EPA's rule addressing SILs, except for the parts of its rule codifying PM2.5 SILs in 40 C.F.R. § 51.165(b)(2). We grant the Sierra Club's petition as to the parts of the EPA's rule establishing a PM2.5 SMC, and vacate them because these parts of the rule exceed the EPA's statutory authority. See 42 U.S.C. § 7607(d)(9)(3)."

 

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Honeywell International, Inc. v. U.S. EPA

Jan 22: In the U.S. Court of Appeals, D.C. Circuit, Case No. 10-1347, consolidated with 10-1348, 10-1349, 10-1350. On Petitions for Review of Rules of the Environmental Protection Agency. The Appeals Court explains that under the Clean Air Act, U.S. EPA administers a cap-and-trade program regulating the production and consumption of hydrochlorofluorocarbons, a class of ozone-depleting pollutants. (It is noted parenthetically: "We frown on excessive use of acronyms, but in a case involving a 24-letter word, we think it appropriate to use HCFCs for hydrochlorofluorocarbons.") This cap-and-trade program entails overall caps on production and consumption of various HCFCs for each year, as well as EPA-administered baseline allowances of HCFCs for each participating company. Companies are then permitted to transfer their

allowances, subject to certain statutory and regulatory restrictions.

 

    The Appeals Court said, "Honeywell and DuPont, whom we refer to collectively as Honeywell, complain that certain 2008 transfers made by their competitors Arkema and Solvay were deemed to permanently increase those competitors' future baseline

allowances of HCFC-22. Because there is an overall cap on HCFC-22 production, this is a zero-sum system: The increased allowances to Arkema and Solvay in turn reduced Honeywell's market share and allowances of HCFC-22. The problem for Honeywell here is that this Court concluded in Arkema Inc. v. EPA that those permanent transfers were valid under the Clean Air Act. 618 F.3d 1, 6-9 (D.C. Cir. 2010). Honeywell believes that Arkema was incorrectly decided. Absent en banc review, we must adhere to circuit precedent. And because Honeywell's other challenges to the 2008 transfers are meritless, we deny the petitions for review."

 

    The Appeals Court said further and concluded, "Honeywell disagrees strongly with this Court's decision in Arkema. For that matter, EPA says that it too disagrees with Arkema. (Intervenors Arkema and Solvay are of course happy with Arkema.) Absent en banc review, we are bound by the Arkema decision. In a roundabout attempt to undermine the now-permanent 2008 transfers, Honeywell also raises longshot procedural challenges to the 2008 transfers themselves. The basic answer to those various arguments is that Honeywell had notice and an opportunity to present its views during EPA's pre-Arkema regulatory proceedings, during the Arkema litigation, and during EPA's subsequent post-Arkema proceedings. Because Honeywell had notice and an opportunity to comment, and EPA's reasonable interpretation of its regulation controls, see Auer v. Robbins, 519 U.S. 452, 461 (1997), its procedural objections to the 2008 transfers are unavailing. As is apparent from the briefing, Honeywell's real problem here is the permanence of the 2008 interpollutant transfers by Arkema and Solvay and the altered HCFC-22 allowances for the 2010-2014 period. In other words, Honeywell's real problem is Arkema. But a panel cannot remedy that problem."

 

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