213 F.3d 663 (D.C. Cir. 2000), 98-1497, St. of Michigan v. United States Envt'l Protection Agency

Docket Nº:98-1497, 98-1499, 98-1500, 98-1501, 98-1502, 98-1504, 98-1518,98-1556, 98-1567, 98-1573, 98-1585, 98-1588, 98-1590,98-1596, 98-1598, 98-1601, 98-1602, 98-1608, 98-1609,98-1611, 98-1615, 98-1616, 98-1617, 98-1618, 98-1619,98-1621, 99-1070, 99-1093
Citation:213 F.3d 663
Party Name:State of Michigan, Michigan Department of Environmental Quality and State of West Virginia, Division of Environmental Protection, Petitioners v. U.S. Environmental Protection Agency, Respondent New England Council, Inc., et al., Intervenors
Case Date:March 03, 2000
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit
 
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213 F.3d 663 (D.C. Cir. 2000)

State of Michigan, Michigan Department of Environmental Quality and State of West Virginia, Division of Environmental Protection, Petitioners

v.

U.S. Environmental Protection Agency, Respondent

New England Council, Inc., et al., Intervenors

Nos. 98-1497, 98-1499, 98-1500, 98-1501, 98-1502, 98-1504, 98-1518,98-1556, 98-1567, 98-1573, 98-1585, 98-1588, 98-1590,98-1596, 98-1598, 98-1601, 98-1602, 98-1608, 98-1609,98-1611, 98-1615, 98-1616, 98-1617, 98-1618, 98-1619,98-1621, 99-1070, 99-1093

United States Court of Appeals, District of Columbia Circuit

March 3, 2000

Argued November 9, 1999

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On Petitions for Review of an Order of the Environmental Protection Agency

Susan E. Ashbrook, Assistant Attorney General, State of Ohio, James C. Gulick, Special Deputy Attorney, State of North Carolina, Andrea B. Field, Theodore L. Garrett, Todd Palmer, Jonathan S. Martel, William F. Pedersen and Scott H. Segal argued the causes for petitioners. With them on the briefs were Betty D. Montgomery, Attorney General, State of Ohio, Andrew S. Bergman, Assistant Attorney General, Michael F. Easley, Attorney General, State of North Carolina, J. Allen

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Jernigan, Special Deputy Attorney General, James P. Longest, Jr., and Amy R. Gillespie, Assistant Attorneys General, Bill Pryor, Attorney General, State of Alabama, Tommy E. Bryan, Assitant Attorney General, Jeffrey Modisett, Attorney General, State of Indiana, Daniel B. Dovenbarger, Chief Counsel, Jennifer M. Granholm, Attorney General, State of Michigan, Thomas Casey, Solicitor General, Alan F. Hoffman, Assistant Attorney General, Charles M. Condon, Attorney General, State of South Carolina, Mark E. Earley, Attorney General, State of Virginia, Roger L. Chaffe, Senior Assistant Attorney General, Stewart T. Leeth, Assistant Attorney General, Thomas H. Zerbe, Senior Counsel, State of West Virginia, Samuel L. Finklea, III, Grant Crandall, Eugene M. Trisko, Norman W. Fichthorn, Mel S. Schulze, David M. Flannery, Kathy Beckett, Harold P. Quinn, Jr., Michael D. Hockley, J. Lister Hubbard, R. Brooke Lawson, III, Robert E. Lannan, II, Terry J. Satterlee, Alok Ahuja, Mark E. Shere, Bryan G. Tabler, Jeffrey L. Landsman, Jennifer S. McGinnity, Howard E. Shapiro, Margaret Claiborne Campbell, Thomas E. Knauer, David R. Straus, Deborah E. Jennings, Julie R. Domike, Patricia T. Barmeyer, Lisa G. Dowden, Brian J. Renaud, Rhonda L. Ross, Jeffrey F. Cherry, Katherine L. Rhyne, John M. Koeppl, Henry J. Handzel, Jeffrey A. Knight, Joan Dreskin, Kevin B. Belford, Pamela A. Lacey, Gene E. Godley, Michael H. Levin and Edmund B. Frost. Earle D. Getchell, Jr., Neal J. Cabral, Christopher D. Man, Jacqueline H. Fine, Jon S. Faletto and John P. Proctor entered appearances.

James E. Doyle, Attorney General, State of Wisconsin, and Philip Peterson and Thomas L. Dosch, Assistant Attorneys General, were on the brief for intervenor State of Wisconsin.

Louis E. Tosi and William L. Patberg were on the brief for amicus curiae Toledo Metropolitan Area Council of Governments.

Charles S. Carter and Deborah Ann Hottel were on the brief of amici curiae South Carolina Chamber of Commerce, Environmental Management Association of South Carolina, South Carolina Manufacturers Alliance, and South Carolina Farm Bureau Federation.

Jon M. Lipshultz and Patricia R. McCubbin, Attorneys, U.S. Department of Justice, argued the causes for respondent. With them on the brief were Lois J. Schiffer, Assistant Attorney General, and Jan Tierney, Howard Hoffman, Amey W. Marrella and Dwight C. Alpern, Attorneys, U.S. Environmental Protection Agency.

J. Jared Snyder, Assistant Attorney General, State of New York, argued the cause for state intervenors. With him on the brief were Elliot Spitzer, Attorney General, Peter H. Schiff, Deputy Attorney General, Thomas F. Reilly, Attorney General, State of Massachusetts, William L. Pardee, Assistant Attorney General, M. Dukes Pepper, Jr., Assistant Counsel, State of Pennsylvania, Sheldon Whitehouse, Attorney General, State of Rhode Island, Michael Rubin, Environmental Advocate, William H. Sorrell, Attorney General, State of Vermont, Ronald A. Shems, Assistant Attorney General, Jennifer L. Wurzbacher, Assistant Attorney General, State of Maryland, Richard Blumenthal, Attorney General, State of Connecticut, Richard F. Webb, Assistant Attorney General, Andrew Ketterer, Attorney General, State of Maine, Paul Stern, Deputy Attorney General, Philip McLaughlin, Attorney General, State of New Hampshire, and Maureen D. Smith, Assistant Attorney General.

Kathleen L. Millian argued the cause for intervenor Her Majesty the Queen in Right of Ontario (Province of Ontario, Canada). With her on the brief was Bruce J. Terris.

David Hawkins and Raissa Griffin were on the brief for intervenor Natural Resources Defense Council, et al. Andrew P. Caputo entered an appearance.

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Patrick M. Raher, John G. Roberts, Jr., Catherine E. Stetson, Michael R. Barr, Michael A. Conley, Theresa Fenelon Falk, John H. Sharp, Paul G. Wallach and Kenneth R. Meade were on the brief for industry intervenors.

Richard A. Wegman was on the brief for intervenor the Government of Canada.

Before: Williams, Sentelle and Rogers, Circuit Judges.

Opinion Per Curiam.[*].

Dissenting opinion filed by Circuit Judge Sentelle.

Introduction

Under the Clean Air Act the Environmental Protection Agency promulgates national ambient air quality standards ("NAAQS") for air pollutants, and states must then adopt state implementation plans ("SIPs") providing for the implementation, maintenance, and enforcement of the NAAQS;such plans are then submitted to EPA for approval. See Clean Air Act ("CAA") S 110(a)(1), 42 U.S.C. S 7410(a)(1) (1994). Even after a SIP is approved, EPA may at a later time call for SIP revisions if the Administrator finds a SIP inadequate to attain or maintain the NAAQS, to meet the dictates of pollutant transport commissions, or "to otherwise comply with any requirement of this chapter." CAA S 110(k)(5), 42 U.S.C. S 7410(k)(5).

In October 1998 EPA issued a final rule mandating that 22 states and the District of Columbia revise their SIPs to mitigate the interstate transport of ozone.1 See Finding of Significant Contribution and Rulemaking for Certain States in the Ozone Transport Assessment Group Region for Purposes of Reducing Regional Transport of Ozone ("Final Rule"), 63 Fed. Reg. 57,356 (1998). The statutory hook for EPA's action was a 1990 amendment to the Clean Air Act which requires that SIPs contain "adequate provisions" prohibiting

any source or other type of emissions activity within the State from emitting any air pollutant in amounts which will ... contribute significantly to non attainment in, or interfere with maintenance by, any other State with respect to any such national primary or secondary am-bient air quality standard.

CAA S 110(a)(2)(D)(i)(I), 42 U.S.C. S 7410(a)(2)(D)(i)(I) (1994). EPA uniformly required that each state reduce nitrogen oxides (NOx--an ozone precursor) by the amount accomplishable by what EPA dubbed "highly cost-effective controls," namely, those controls EPA found capable of removing NOX at a cost of $2000 or less per ton. Numerous petitions for review challenge various aspects of EPA's decision.

In Part I we reject the following claims: that EPA could not call for the SIP revisions without convening a transport commission; that EPA failed to undertake a sufficiently state-specific determination of ozone contribution; that EPA unlawfully overrode past precedent regarding "significant" contribution; that EPA's consideration of the cost of NOx reduction violated the statute; that EPA's scheme of uniform controls is arbitrary and capricious; that CAA S 110(a)(2)(D)(i)(I) as construed by EPA violates the nondelegation doctrine.

In Part II we hold that the record does not support including Wisconsin in the SIP call, nor does it support creating NOx budgets based on the entire emissions of Missouri or Georgia. We reject the claim that

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South Carolina was improperly included in the SIP call.

In Part III we reject the claim that EPA impermissibly intruded on the statutory rights of states to fashion their SIPs. We also reject the claim that EPA violated the Regulatory Flexibility Act.

In Part IV we reject the claim that EPA arbitrarily revised the definition of a "NOx budget unit." We reject all of the claims raised by the Council of Industrial Boilers save one: we hold that EPA failed to provide adequate notice of a change in the definition of an electric generating unit. We also hold that EPA did not provide adequate notice of a change in the control level assumed for large, stationary internal combustion engines, but we reject the claim that EPA failed to follow its own standards in defining such engines. Finally, we uphold EPA's limits on early reduction credits, and EPA's use of a 15% multiplier for calculating emissions from low mass emission units.

We note at the outset that one challenge has been stayed. In 1979, EPA set the acceptable level for ozone in the ambient air at 0.12 parts per million ("ppm"), averaged over intervals of one hour. This standard is commonly known as the "1-hour standard." By 1997, EPA had concluded that the 1-hour standard no longer adequately protected public health. See National Ambient Air Quality Standards for Ozone, 62 Fed. Reg. 38,856 (1997). Pursuant to the agency's statutory mandate to review and revise NAAQS as appropriate, 42 U.S.C. S 7409(d)(1), EPA promulgated a new, more stringent "8-hour standard" which limits ozone...

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