Arizona ex rel. Darwin v. U.S. Envtl. Prot. Agency

Decision Date24 February 2016
Docket Number13–70410.,Nos. 13–70366,s. 13–70366
Parties State of ARIZONA, ex rel. Henry R. DARWIN, Director, Arizona Department of Environmental Quality, Petitioner, v. U.S. ENVIRONMENTAL PROTECTION AGENCY; Lisa P. Jackson, Administrator, United States Environmental Protection Agency, Respondents, National Parks Conservation Association; Sierra Club, Respondent–Intervenor. Salt River Project Agricultural Improvement and Power District, Petitioner, v. U.S. Environmental Protection Agency, Respondent, National Parks Conservation Association; Sierra Club, Respondent–Intervenors.
CourtU.S. Court of Appeals — Ninth Circuit

Peter Glaser (argued), Troutman Sanders LLP, Washington, D.C.; Paul L. Gale, Troutman Sanders LLP, Irvine, California; Carroll W. McGuffey III, Troutman Sanders LLP, Atlanta, Georgia; Thomas C. Horne, Arizona Attorney General, and James T. Skardon, Assistant Attorney General, Phoenix, Arizona, for Petitioner State of Arizona.

Norman W. Fichthorn (argued) and Aaron M. Flynn, Hunton & Williams LLP, Washington, D.C., for Petitioners Arizona Public Service Company and Salt River Project Agricultural Improvement and Power District.

Angeline Purdy (argued), United States Department of Justice; Robert G. Dreher, Acting Assistant Attorney General, Washington, D.C., for Respondent United States Environmental Protection Agency.

Michael A. Hiatt (argued), Earthjustice, Denver, Colorado; Suma Peesapati, Earthjustice, San Francisco, California, for RespondentIntervenors National Parks Conservation Association and Sierra Club.

Maureen A. Scott, Matthew Laudone, and Janice M. Alward, Phoenix, Arizona, for Amicus Curiae Arizona Corporation Commission.

Michelle L. Wood, Phoenix, Arizona, for Amicus Curiae Arizona Residential Utility Consumer Office.

Gordon A. Coffee, John M. Holloway III, and Stephanie B. Sebor, Winston & Strawn LLP, Washington, D.C.; Rae Cronmiller, Environmental Counsel, National Rural Electric Cooperative Association, Arlington, Virginia, for Amicus Curiae National Rural Electric Cooperative Association.

On Petition for Review of an Order of the Environmental Protection Agency.

Before: MARSHA S. BERZON, JAY S. BYBEE, and JOHN B. OWENS, Circuit Judges.

OPINION

BERZON

, Circuit Judge:

Congress initially enacted the Clean Air Act ("the Act" or "CAA") in 1963 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)

. Later, in the Clean Air Act Amendments of 1977, Pub. L. No. 95–95, § 128, 91 Stat. 685, 742 (current version at 42 U.S.C. § 7491 ), Section 169A was added "in response to a growing awareness that visibility was rapidly deteriorating in many places, such as wilderness areas and national parks." Am. Corn Growers Ass'n v. EPA, 291 F.3d 1, 3 (D.C.Cir.2002) (internal quotation marks omitted) (quoting Chevron U.S.A., Inc. v. EPA, 658 F.2d 271, 272 (5th Cir.1981) ).

To improve outdoor visibility, the Act as amended "invites each State to submit to EPA a State Implementation Plan (‘SIP’) setting forth emission limits and other measures necessary to make reasonable progress toward the national visibility goal." Nat'l Parks Conservation Ass'n v. EPA, 788 F.3d 1134, 1138 (9th Cir.2015)

("NPCA ") (citing 42 U.S.C. §§ 7410(a), 7491(b)(2) ). SIPs must include determinations of the "best available retrofit technology" ("BART") to reduce emissions from certain major emission sources, including large fossil-fuel power plants. 42 U.S.C. § 7491(b)(2). If a state chooses not to submit a SIP, or if EPA disapproves a SIP in whole or in part, "the Act requires EPA to produce a ‘Federal Implementation Plan’ (‘FIP’) for that State." NPCA, 788 F.3d at 1138–39 (citing 42 U.S.C. § 7410(c)(1)(A) ).

Arizona and the Salt River Project Agricultural Improvement and Power District ("the State" and "SRP," respectively, and, collectively, "Petitioners") petition for review of a Final Rule ("Rule") promulgated by EPA. The Rule partially disapproved Arizona's regional haze SIP submission and promulgated a FIP in place of the disapproved SIP elements. Approval, Disapproval and Promulgation of Air Quality Implementation Plans, 77 Fed. Reg. 72,512 (Dec. 5, 2012)

(the "Final Rule"). In what remains of this case,1 Petitioners challenge (1) EPA's disapproval of Arizona's BART determinations, and (2) the FIP's replacement determinations, concerning nitrogen oxides (NOX) emission limits at Coronado Generating Station ("Coronado"), a two-unit, 733–megawatt coal-fueled power plant located in Eastern Arizona.

We conclude that EPA did not act arbitrarily and capriciously when it disapproved in part the SIP's BART determinations for Coronado and issued a replacement FIP as to the disapproved portions. We therefore deny the consolidated petitions for review.

I. STATUTORY AND REGULATORY BACKGROUND
A. The Clean Air Act's Visibility Protections

In enacting Section 169A2 Congress "declare[d] as a national goal the prevention of any future, and the remedying of any existing, impairment of visibility in mandatory class I Federal areas which impairment results from manmade air pollution." § 7491(a)(1)

. "Class I" Federal areas include certain national wilderness areas and national parks. Arizona contains twelve Class I areas, the largest of which is Grand Canyon National Park.

Section 169A seeks to reduce "regional haze," that is, "visibility impairment caused by geographically dispersed sources emitting fine particles and their precursors into the air." Am. Corn Growers, 291 F.3d at 3

(internal quotation marks omitted). In service of this goal, Section 169A requires that certain sources contributing to visibility impairment install BART—which, again, is an acronym for "best available retrofit technology."3 States must review all major stationary emissions sources built between 1962 and 1977 to determine whether the source "emits any air pollutant which may reasonably be anticipated to cause or contribute to any impairment of visibility in" any Class I area. § 7491(b)(2)(A). The states are then responsible for determining the appropriate BART controls for each source. See 42 U.S.C. § 7491(b)(2)(A), (g)(2).

EPA reviews the states' SIP submissions, if any, for consistency with the statute and regulations. See 42 U.S.C. § 7410(c)(1)(A)

; Oklahoma v. EPA, 723 F.3d 1201, 1204 (10th Cir.2013). If EPA determines that a SIP does not meet the Act's requirements, the federal agency may itself determine BART and impose a FIP. See 42 U.S.C. § 7491(b)(2)(A). More specifically, if EPA finds that a state has not submitted a required SIP, determines that a submitted SIP is incomplete, or disapproves a SIP in whole or in part, it "shall promulgate a[FIP] at any time within 2 years." 42 U.S.C. § 7410(c)(1). EPA must promulgate a FIP "unless the State corrects the deficiency, and [EPA] approves the plan or plan revision, before [EPA] promulgates [the FIP]." Id.

When determining BART, states or EPA must consider five factors: "[1] the costs of compliance, [2] the energy and nonair quality environmental impacts of compliance, [3] any existing pollution control technology in use at the source, [4] the remaining useful life of the source, and [5] the degree of improvement in visibility which may reasonably be anticipated to result from the use of such technology." 42 U.S.C. § 7491(g)(2)

. Each source subject to the BART requirement must install and operate BART "as expeditiously as practicable but in no event later than five years after the date of approval of a[SIP] ... or the date of promulgation of [a FIP]." 42 U.S.C. §§ 7491(g)(4).

B. EPA Regional Haze Regulations

Section 169A directed EPA to issue regulations requiring states with Class I areas within their borders to submit SIPs containing "emission limits, schedules of compliance and other measures as may be necessary to make reasonable progress toward meeting the national goal." 42 U.S.C. § 7491(b)(2)

. EPA was also required to develop guidelines for the states "on appropriate techniques and methods for implementing" Section 169A. Id. § 7491(b)(1)

. In 1990, Congress added Section 169B to expand the CAA's focus to include regional haze, see 42 U.S.C. § 7492 —that is, "visibility impairment that is caused by the emission of air pollutants from numerous sources located over a wide geographic area," 40 C.F.R. § 51.301. "Section 169B requires, among other things, that EPA undertake research to identify ‘sources' and ‘source regions' of visibility impairment in Class I areas, consider designating transport commissions to study the interstate movement of pollutants, and establish a transport commission for the Grand Canyon National Park." Am. Corn Growers, 291 F.3d at 4.

Pursuant to Sections 169A and 169B, EPA in 1999 promulgated regional haze regulations. 64 Fed. Reg. 35,714 (July 1, 1999)

(codified at 40 C.F.R. § 51.300 –.309 ). The D.C. Circuit partially vacated those regulations in American Corn Growers Ass'n v. EPA, 291 F.3d at 6.4 Thereafter, the agency in 2005 promulgated new regulations, the Regional Haze Regulations and Guidelines for Best Available Retrofit Technology (BART) Determinations, 70 Fed. Reg. 39,104 (July 6, 2005) ("Haze Regulations"). At the same time, EPA issued Guidelines to help states identify "BART-eligible" sources and determine the appropriate BART for each source. Id. at 39,156 (codified at 40 C.F.R. pt. 51, app. Y ) ("Guidelines"); see also 42 U.S.C. § 7491(b).

The Haze Regulations set a goal of achieving natural visibility at all Class I areas by 2064. 40 C.F.R. § 51.308

. Toward that end, the Regulations direct states to submit SIPs to EPA containing "goals (expressed in deciviews) that provide for reasonable progress towards achieving natural visibility conditions." 40 C.F.R. § 51.308(d)(1). A "deciview" is a measurement of visibility impairment. More specifically, it "is a haze index derived from calculated light extinction, such that uniform...

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