Columbia Falls Aluminum Co. v. E.P.A.

Decision Date17 June 1998
Docket Number97-1558 and 97-1724,97-1044,Nos. 96-1234,s. 96-1234
Citation139 F.3d 914
Parties, 329 U.S.App.D.C. 221, 28 Envtl. L. Rep. 21,106 COLUMBIA FALLS ALUMINUM COMPANY, et al., Petitioners, v. ENVIRONMENTAL PROTECTION AGENCY and Carol M. Browner, Administrator, Respondents, Reynolds Metals Company, et al., Intervenors.
CourtU.S. Court of Appeals — District of Columbia Circuit

On Petitions for Review of Orders of the Environmental Protection Agency.

Lester Sotsky argued the cause for petitioners. With him on the briefs was Jonathan S. Martel, Washington, DC. Andrew S. Ratzkin, New York City, entered an appearance.

Steven E. Silverman, Attorney, Environmental Protection Agency, argued the cause for respondents. With him on the brief were Lois J. Schiffer, Assistant Attorney General, U.S. Department of Justice, and Daniel R. Dertke, Washington, DC, Attorney.

Michael W. Steinberg argued the cause for intervenors Reynolds Metals Company, et al. With him on the brief were Joshua D. Sarnoff, Washington, DC, Loren R. Dunn, Seattle, WA, and David R. Case, Washington, DC. Lowell F. Martin and Michael A. McCord, Washington, DC, entered appearances.

Before: GINSBURG, HENDERSON, and RANDOLPH, Circuit Judges.

Opinion for the Court filed by Circuit Judge RANDOLPH.

RANDOLPH, Circuit Judge:

These consolidated petitions, brought by small manufacturers of aluminum, challenge three rules of the Environmental Protection Agency, promulgated pursuant to § 3004 of the Resource Conservation and Recovery Act of 1976 ("RCRA"), Pub.L. No. 94-580, 90 Stat. 2795. The rules establish a treatment standard for "spent potliner"--a byproduct of primary aluminum reduction--and prohibit its land disposal if it is untreated. Because EPA's test for determining compliance with its spent potliner treatment standard is arbitrary and capricious, we vacate and remand. In all other respects, we deny the petitions for review.

I. BACKGROUND
A. Statute and Regulations

Subtitle C of RCRA establishes a comprehensive regulatory scheme governing the treatment, storage, and disposal of hazardous wastes. Wastes are considered hazardous if they possess one of four characteristics (ignitability, corrosivity, reactivity, and toxicity) or if EPA lists them as hazardous following a rulemaking. See 42 U.S.C. § 6921(a); 40 C.F.R. pt. 261. Once a waste is listed or identified as hazardous, every aspect of its existence is regulated under Subtitle C. See Chemical Waste Management, Inc. v. EPA, 976 F.2d 2, 8 (D.C.Cir.1992).

In 1984 Congress adopted the Hazardous and Solid Waste Amendments ("Amendments"), Pub.L. No. 98-616, 98 Stat. 3221, shifting "the focus of hazardous waste management away from land disposal to treatment alternatives." American Petroleum Inst. v. EPA, 906 F.2d 729, 733 (D.C.Cir.1990). The Amendments prohibit land disposal of hazardous wastes unless one of two conditions is satisfied: either the waste is treated to comply with standards promulgated under RCRA § 3004(m), or EPA determines that hazardous constituents will not "migrate" from the disposal unit. RCRA § 3004(g)(5), 42 U.S.C. § 6924(g)(5). Section 3004(m) provides that EPA must specify "those levels or methods of treatment, if any, which substantially diminish the toxicity of the waste or substantially reduce the likelihood of migration of hazardous constituents from the waste so that short-term and long-term threats to human health and the environment are minimized." 42 U.S.C. § 6924(m)(1). 1 If hazardous wastes are treated to the level or by the method specified under § 3004(m), they are not subject to the land disposal prohibitions. 42 U.S.C. § 6924(m)(2).

The 1984 Amendments did not ban all land disposal outright. With the exception of two categories of hazardous wastes for which Congress imposed earlier restrictions, 2 EPA had to implement the land disposal prohibition in three phases for all wastes identified or listed as hazardous as of the time of the 1984 Amendments. See generally Hazardous Waste Treatment Council v. EPA, 886 F.2d 355, 357 & n. 1 (D.C.Cir.1989). To guarantee promptness, a statutory "hard hammer" fell on May 8, 1990. 42 U.S.C. § 6924(g)(6)(C). Hazardous wastes for which EPA failed to issue regulations by that date were subject to an absolute ban on land disposal. For newly identified or listed hazardous wastes, the statute required EPA to promulgate prohibitions and treatment standards within six months of the date of listing or identification. RCRA § 3004(g)(4), 42 U.S.C. § 6924(g)(4). EPA may delay the effective date of the land disposal prohibition until the earliest date that "adequate alternative treatment, recovery, or disposal capacity which protects human health and the environment" is available, but in any event no longer than two years. RCRA § 3004(h)(2), 42 U.S.C. § 6924(h)(2). This is known as a "national capacity variance." Applicants may request an extension of the effective date for up to one year, renewable once for no more than one additional year. RCRA § 3004(h)(3), 42 U.S.C. § 6924(h)(3).

B. Spent Potliner

All aluminum in the United States is produced by dissolving alumina (aluminum oxide) in a molten cryolite bath and then introducing a direct electric current to reduce the alumina to aluminum metal. The reduction takes place in electrolytic cells, called pots, consisting of a steel shell lined with brick with an inner lining of carbon. The carbon lining is up to 15 inches thick and serves as the cathode for the electrolysis process. During a service life of four to seven years, the carbon lining absorbs the cryolite solution and degrades. Once a liner cracks, the pot is emptied and cooled. The steel shell is stripped away, leaving a large solid block of carbon--a "spent potliner." 3 An estimated 100,000 to 125,000 metric tons are produced each year. See 62 Fed.Reg. 1991, 1993 (1997).

The listing of spent potliner--assigned hazardous waste code K088--has a tangled history. EPA originally listed K088 in 1980 because it contained high concentrations of cyanide. See 45 Fed.Reg. 47,832 (1980). Before the regulations took effect, Congress enacted the Solid Waste Disposal Act of 1980, Pub.L. No. 96-482, 94 Stat. 2334, which included a provision named after its sponsor, Congressman Tom Bevill of Alabama. The Bevill Amendment excluded mining wastes from Subtitle C regulation until EPA had conducted a study of the "adverse effects" of such wastes. See RCRA § 8002(p), 42 U.S.C. § 6982(p). EPA interpreted the Bevill Amendment to include "solid wastes generated during the smelting and refining of ores and minerals" and suspended its listing of spent potliner. See 46 Fed.Reg. 4614, 4615 (1981). When litigation ensued, EPA announced a proposed reinterpretation narrowing the scope of the Bevill exclusion. See 50 Fed.Reg. 40,292 (1985). EPA then changed its mind, withdrew its proposed reinterpretation, and was sued again. In Environmental Defense Fund v. EPA, this court ordered the Agency to relist spent potliner by August 31, 1988. 852 F.2d 1316, 1331 (D.C.Cir.1988). The Agency complied, see 53 Fed.Reg. 35,412 (1988), but missed the six-month statutory deadline for promulgating land disposal restrictions and treatment standards. As the result of another suit filed by EDF, EPA signed a consent decree requiring it to promulgate a final rule establishing land disposal restrictions for spent potliner by June 30, 1996. See EDF v. Reilly, No. 89-0598 (D.D.C.).

In April 1996, EPA promulgated the first of three rules challenged here. The Rule prohibited land disposal of spent potliner unless the waste satisfied the § 3004(m) treatment standard established in the same rulemaking. See 61 Fed.Reg. 15,566 (Apr. 8, 1996). The April 1996 Rule also granted a nine-month national capacity variance pursuant to § 3004(h)(2) "to allow facilities generating K088 adequate time to work out logistics." 61 Fed.Reg. at 15,589.

At the time of the April 1996 rulemaking, only Reynolds Metals Company was engaged in full-scale treatment of spent potliner. Reynolds, an intervenor in this case, had begun treating spent potliner at its facility in Gum Springs, Arkansas several years before any rule was proposed. See Brief for Intervenors at 4. The Reynolds treatment process involves crushing spent potliner to particle size and adding roughly equal parts limestone and brown sand. 4 According to Reynolds, the brown sand prevents the mixture from clogging in the kiln and the limestone reacts with the fluoride in spent potliner to transform it into relatively insoluble calcium fluoride. See 56 Fed.Reg. 32,993, 33,003 (1991); see also 56 Fed.Reg. 55,160, 55,180 (1991) (discussing potential for slagging or clogging in thermal treatment of spent potliner). The mixture is fed into a thermal rotary kiln that is 250 feet in length and 9.5 feet in diameter. Natural gas heats the kiln to 1200 degrees Fahrenheit. When the material exits the kiln, it is cooled and then deposited in an on-site monofill.

Under its "derived from" rule, EPA listed the kiln residue as hazardous because it was generated from the treatment of a hazardous waste. See 40 C.F.R. § 261.3(c)(2)(i). In August 1989, Reynolds petitioned EPA to "delist" its kiln residue--exempt it from the list of hazardous wastes--maintaining that the treated residue was no longer hazardous. EPA granted Reynolds' delisting petition pursuant to RCRA § 3001(f), 42 U.S.C. § 6921(f). See 56 Fed.Reg. 67,197 (1991). The delisting allowed Reynolds to dispose of treated spent potliner in non-Subtitle C units. EPA recognized that although it was not specifying a particular technology, as a practical matter Reynolds would wind up treating most spent potliner because Reynolds provided "virtually all existing treatment capacity." 62 Fed.Reg. at 1993.

The April 1996 Rule for spent potliner established a treatment standard expressed as numerical concentration limits for various...

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