National Parks & Conservation v. Tennessee Valley

• Citation: 502 F.3d 1316
• Decision Date: 04 October 2007
• Docket Number: No. 06-10729.,06-10729.
• Parties: NATIONAL PARKS AND CONSERVATION ASSOCIATION, INC., Sierra Club, Plaintiffs-Appellants, v. TENNESSEE VALLEY AUTHORITY, Defendant-Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (11th Circuit)

502 F.3d 1316

NATIONAL PARKS AND CONSERVATION ASSOCIATION, INC., Sierra Club, Plaintiffs-Appellants, v. TENNESSEE VALLEY AUTHORITY, Defendant-Appellee.

No. 06-10729.

United States Court of Appeals, Eleventh Circuit.

October 4, 2007.

George E. Hays, San Francisco, CA, Reed Zars, Laramie, WY, William J. Moore, III, Jacksonville, FL, for Plaintiffs-Appellants.

Maria Victoria Gillen, Frank H. Lancaster, Harriet A. Cooper, TVA, Knoxville, TN, for TVA.

Michael James Grode, Jr., Turner Environmental Law Clinic, Atlanta, GA, Michael J. Myers, Albany, NY, Robert D. Tambling, Montgomery, AL, F. William Brownell, Henry V. Nickel, Makram B. Jaber, Hunton & Williams, LLP, Washington, DC, P. Stephen Gidiere, III, Michael D. Freeman, Steven G. McKinney, Balch & Bingham, LLP, Birmingham, AL, for Amici Curiae.

Appeal from the United States District Court for the Northern District of Alabama.

Before EDMONDSON, Chief Judge, and TJOFLAT and GIBSON,^* Circuit Judges.

GIBSON, Circuit Judge:

National Parks Conservation Association, Inc., and the Sierra Club appeal from the district court's orders dismissing with prejudice their action against the Tennessee Valley Authority brought under the citizen suit provision of the Clean Air Act, 42 U.S.C. § 7604(a). National Parks and the Sierra Club claim that TVA violated the Act in connection with work it performed in 1982-83 on a coal-fired boiler at its power plant in Colbert County, Alabama. National Parks and the Sierra Club assert three claims against TVA; the district court denied their motion for partial summary judgment and granted TVA's motion to dismiss two of the claims as barred by the statute of limitations and the remaining claim for failure to provide proper pre-suit notice. We affirm.

I.

The Tennessee Valley Authority is a federal agency that operates over forty electricity generating facilities, including the Colbert Plant in Tuscumbia, Alabama. The Colbert Plant uses five coal-fired boiler units to generate electricity. The process involves burning coal to create steam and passing the steam through a turbine, which drives a generator that produces electricity. National Parks and the Sierra Club claim that the Colbert Plant's operations emit harmful quantities of pollutants, specifically nitrogen oxide, particulate matter, and sulfur dioxide. Although not the subject of this suit, they have similar complaints about TVA's operations at several other power plants located throughout Tennessee, Alabama, and Kentucky.

The allegations in this lawsuit are limited to only one of the Colbert Plant's boilers, Unit 5. Colbert Unit 5 has been in operation since 1965. In a project that began in 1982 and was completed in 1983, TVA overhauled Unit 5 to restore its lost capacity, extend its life, and reduce or eliminate forced outages. The project cost over $50 million and took three years from planning to implementation. At all relevant times, TVA has operated Unit 5 under an operating permit issued by the Alabama Department of Environmental Management pursuant to its EPA-approved State Implementation Plan; the permit prescribes emission limitations, and the Department monitors and tests the Unit's emissions to ensure compliance. TVA did not obtain construction permits before undertaking the project, however, and National Parks and the Sierra Club claim that this omission, among others, violates the Clean Air Act.

The goal of the Clean Air Act is "to protect and enhance the quality of the Nation's air resources so as to promote the public health and welfare and the productive capacity of its population." 42 U.S.C. § 7401(b)(1). To achieve this goal, the Act employs a program of "cooperative federalism" under which the EPA develops "National Ambient Air Quality Standards" for various pollutants. Sierra Club v. United States EPA, 315 F.3d 1295, 1300, 1296 (11th Cir.2002). Each state then formulates a "State Implementation Plan," which limits emissions for specific sources of pollution and which must be approved by the EPA, to attain and maintain those standards. Id.; see also 42 U.S.C. §§ 7409, 7410. The Act differentiates between "existing sources" of pollution and "new sources," and these two types of sources are regulated differently. New York v. United States EPA, 413 F.3d 3, 13 (D.C.Cir.2005). Thus, TVA's obligations with respect to the project and its subsequent operation of Unit 5 depend on how Unit 5 is classified under the Act.

"New sources" of pollution include both newly built units and plants as well as existing ones that have been "modified" in a way that increases their emissions, according to the definitions set forth in the Act and EPA regulations. See, e.g., 42 U.S.C. § 7411(a)(2), (4). Unlike existing sources, new sources and modified sources are subject to the New Source Performance Standards, 42 U.S.C. § 7411, 40 C.F.R. Part 60, which impose stringent emission limitations and other requirements such as monitoring and testing. New sources and modified sources also are subject to New Source Review,¹ which requires the proponent of a proposed construction or modification to complete various requirements before the project can proceed, such as obtain construction permits and determine emission controls to be installed in the source. See 42 U.S.C. § 7475(a); Tenn. Valley Auth. v. Whitman, 336 F.3d 1236, 1244 nn.12-13 (11th Cir.2003). The New Source Performance Standards and New Source Review programs are implemented through EPA-approved State Implementation Plans. See New York v. EPA, 413 F.3d at 11-14.

"Existing sources," in contrast, are plants, units, and other sources that were built before the EPA proposed otherwise applicable standards. 42 U.S.C. § 7411(a)(6), (2). While they are subject to several sets of regulations including State Implementation Plans, they have "grandfathered" status and are not subject to New Source Review or the New Source Performance Standards. New York v. EPA, 413 F.3d at 13. This system is intended to achieve environmental controls without unduly hampering economic growth. Id.

In 1999, the EPA charged TVA with modifying several of its units in violation of the New Source Review programs; Colbert Unit 5 was among these units. The EPA found TVA guilty in administrative proceedings and ordered it to come into compliance with the Act, but this Court refused to enforce the order after concluding that the administrative proceedings were unconstitutional. Whitman, 336 F.3d at 1260. The EPA has not pursued prosecution of TVA for these alleged violations.

After the EPA's action failed, National Parks and the Sierra Club sent TVA notice of their intent to sue for Clean Air Act violations at the Colbert Plant and nine other power plants located throughout Tennessee, Alabama, and Kentucky. Various suits were filed against TVA under the Act's citizen suit provision, 42 U.S.C. § 7604(a). Two of these were filed in the district court below, the present suit and a separate a suit filed by the Sierra Club and the Alabama Environmental Council. That separate suit alleged that TVA's operations at the Colbert Plant repeatedly violated the 20% opacity limitation, an emission limitation for particulate air pollution established by Alabama's State Implementation Plan, during the five-year period from 1997 to 2002. Sierra Club v. Tenn. Valley Auth., 430 F.3d 1337, 1339-41 (11th Cir.2005). The district court granted summary judgment to TVA, holding that there could be no violations because, although the Plant's emissions exceeded the 20% opacity limitation, they were "within the forgiveness zone" of the Alabama Department of Environmental Management's 2% de minimis rule. Id. at 1339. This Court reversed in part, reasoning that the 2% de minimis rule had not been approved by the EPA and thus was not part of Alabama's State Implementation Plan. Id. at 1346-47. We affirmed the dismissal of the plaintiffs' claim for civil penalties as barred by TVA's sovereign immunity but remanded for reconsideration of whether the plaintiffs were entitled to injunctive and declaratory relief for claims arising from the Plant's violations of the opacity limitation. Id. at 1357.

Meanwhile, the instant suit was pending in the district court. National Parks and the Sierra Club allege three counts, all relating to the 1982-83 project and subsequent operation of Colbert Unit 5. The first two counts allege that TVA modified Unit 5 in violation of the New Source Review programs by failing to obtain construction permits, failing to perform air quality analysis and install emission controls, failing to obtain offsets, and operating the Unit as illegally modified. The third count alleges that the Unit's pollutant emissions after the modification exceeded EPA limitations and failed to comply with other requirements of the New Source Performance Standards. National Parks and the Sierra Club seek civil penalties and declaratory and injunctive relief on all counts. They do not dispute that Colbert Unit 5 at all relevant times had an operating permit issued by the Alabama Department of Environmental Management, which monitored compliance as required by Alabama's State Implementation Plan for existing sources. To be viable, all three counts require the 1982-83 project to be characterized as a "major modification," triggering the EPA's New Source Review preconstruction permitting requirements and the emission limitations established by the New Source Performance Standards described above. TVA contends that the 1982-83 project was not a major modification and, in any event, would fall under the exception for routine maintenance, repair, and replacement.

Without deciding this issue, the district court made a series of rulings against National Parks and the Sierra Club, each of which they now challenge on appeal. First, the district court denied National Parks' and the Sierra Club's motion for partial summary judgment on the issue of whether the 1982-83 project involving Colbert Unit...