Genon Rema, LLC v. U.S. Envtl. Prot. Agency

• Citation: 722 F.3d 513
• Decision Date: 12 July 2013
• Docket Number: No. 12–1022.,12–1022.
• Parties: GENON REMA, LLC, Petitioner v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, Respondent.
• Court: U.S. Court of Appeals — Third Circuit

722 F.3d 513

GENON REMA, LLC, Petitioner

v.UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, Respondent.

No. 12–1022.

United States Court of Appeals,Third Circuit.

Argued March 18, 2013.

Opinion Filed: July 12, 2013.

William M. Bumpers, Esq., [argued], Brook Detterman, Esq., Debra J. Jezouit, Esq., Baker Botts L.L.P., Walter Stone, Esq., GenOn Energy Inc., Washington, D.C., for Petitioner, GenOn REMA, LLC.

George P. Sibley, III, Esq., [argued], Hunton & Williams LLP Richmond, VA, Andrea B. Field, Esq., Elizabeth L. Horner, Esq., Hunton & Williams LLP Washington, D.C., for Petitioner–Intervenor, Utility Air Regulatory Group.

Thomas A. Lorenzen, Esq., U.S. Department of Justice, Environmental Enforcement Section, T. Monique Peoples, Esq., [argued], U.S. Department of Justice, Environmental Defense Section, Stephanie L. Hogan, Esq., Office of General Counsel, United States Environmental Protection Agency, Washington, D.C., for Respondent, United States Environmental Protection Agency.

Jon C. Martin, Esq., Ruth E. Musetto, Esq., [argued], Lisa J. Morelli, Esq., Office of Attorney General of New Jersey, Trenton, NJ, for Respondent–Intervenor, State of New Jersey.

Joseph O. Minort, Esq., Clean Air Council, Philadelphia, PA, Zachary M. Fabish, Esq., [argued], The Sierra Club, Washington, D.C., for Respondent–Intervenors, Greenpeace, Clean Air Council and The Sierra Club.

Before: FUENTES, CHAGARES, and BARRY, Circuit Judges.

OPINION OF THE COURT

FUENTES, Circuit Judge:

Portland Generating Station (“Portland”) is a 427–megawatt, coal-fired, electricity generating plant located in Upper Mount Bethel Township in Northampton County, Pennsylvania. Portland is directly across the Delaware River within 500 feet of Knowlton Township in Warren County, New Jersey. The EPA has found that Portland emits sulfur dioxide in amounts that significantly interfere with the control of air pollution across state borders. Sulfur dioxide is a toxic air pollutant that endangers life and health, causing burning of the nose and throat, difficulty breathing, and obstruction of the lungs and airways.¹ Because of its location, Portland's sulfur dioxide emissions travel directly across the river into areas of New Jersey. In response to a petition under the Clean Air Act, the EPA issued a rule imposing direct limits on Portland's emissions and a schedule of restrictions to reduce its contribution to air pollution within three years. GenOn REMA, LLC (“GenOn”), the owner and operator of Portland, challenges the EPA's rule as inconsistent with the agency's authority under the Clean Air Act and as arbitrary and capricious. We will uphold the rule and deny GenOn's petition for review.

I. BACKGROUNDA. Statutory Background

The Clean Air Act authorizes the Environmental Protection Agency (the “EPA”) to establish air quality standards and empowers the states to achieve those standards. Concerned Citizens of Bridesburg v. EPA, 836 F.2d 777, 779 (3d Cir.1987) (internal citations omitted). This “cooperative federalism” structure is a defining feature of the statute. Appalachian Power Co. v. EPA, 249 F.3d 1032, 1046 (D.C.Cir.2001). The Clean Air Act gives the EPA authority to establish national ambient air quality standards (“NAAQS”) for certain pervasive air pollutants to protect public health and welfare. 42 U.S.C. §§ 7408, 7409. Under Section 110 of the Clean Air Act, states are required to implement NAAQS through state implementation plans (“SIPs”) that specify how NAAQS will be achieved and maintained in the state. Id.§§ 7407, 7410. States must adopt and submit SIPs to the EPA that provide for the “implementation, maintenance, and enforcement” of NAAQS within their borders no later than three years after the EPA promulgates a particular NAAQS. ²Id. § 7410(a)(1).

If the EPA approves the SIPs, they become enforceable as federal law. Id. § 7413. If the EPA finds that a SIP is inadequate to attain or maintain a NAAQS or otherwise does not comply with the Clean Air Act, the EPA issues a “SIP call” requiring the state to submit a revised SIP to correct the inadequacies. Id. § 7410(k)(5). The EPA may also promulgate a Federal Implementation Plan (“FIP”) to establish direct federal controls on sources of air pollution if the EPA disapproves a SIP in whole or in part, or finds that a state has failed to submit either a SIP or SIP revision. Id. § 7410(c).

Section 126(b) of the Clean Air Act allows downwind states to petition the EPA for a finding that a source in an upwind state affects the petitioning state's attainment or maintenance of NAAQS due to air pollution emanating from the source in the upwind state. See id. § 7426(b). Section 126(b) of the Clean Air Act provides:

Any State or political subdivision may petition the [EPA] for a finding that any major source or group of stationary sources emits or would emit any air pollutant in violation of the prohibition of section 7410(a)(2)(D)(ii)³ of this title or this section. Within 60 days after receipt of any petition under this subsection and after public hearing, the [EPA] shall make such a finding or deny the petition.

Id.

In turn, Section 7410(a)(2)(D)(i), also known as the “good neighbor provision,” prohibits sources or emissions activity within a state from emitting air pollutants in amounts that will:

(I) contribute significantly to nonattainment in, or interfere with maintenance by, any other State with respect to any such national primary or secondary ambient air quality standard, or

(II) interfere with measures required to be included in the applicable implementation plan for any other State ... to prevent significant deterioration of air quality or to protect visibility.

Id. § 7410(a)(2)(D)(i).

If the EPA finds, pursuant to a Section 126(b) petition, that the upwind state is violating the good neighbor provision of the Clean Air Act, the polluting source must cease operations within three months of the EPA's finding. Id. § 7426(c). The EPA may, however, allow the source to continue operations beyond three months if the source “complies with such emission limitations and compliance schedules (containing increments of progress)” as the EPA deems necessary to reach the compliance requirements. Id.

B. NAAQS Regulating Sulfur Dioxide Emissions

Sulfur dioxide, or SO2, is a “highly reactive colorless gas” that derives mainly from fossil fuel combustion. Am. Lung Ass'n v. EPA, 134 F.3d 388, 389 (D.C.Cir.1998). It smells like rotten eggs and causes acid rain at elevated concentrations in the air. Id. The presence of sulfur dioxide in the air creates adverse health effects, especially for people with asthma. Id. On June 22, 2010, the EPA revised the NAAQS that had previously regulated sulfur dioxide emissions to enact stricter standards and ensure the continued protection of public health with an “adequate margin of safety.” Primary National Ambient Air Quality Standard for Sulfur Dioxide, 75 Fed.Reg. 35,520, 35,521 (June 22, 2010) (to be codified at 40 C.F.R. pts. 50, 53, 58) (“1–hour SO2 NAAQS”). Specifically, the EPA replaced the 24–hour and the annual standards that had been in place with a new short-term, more stringent standard that sets the level of sulfur dioxide emissions at 75 ppb (parts per billion) per the hour. Id. 1–hour SO2 NAAQS became effective on August 23, 2010. As part of the implementation process of the 1–hour SO2 NAAQS, states are required to submit their SIPs by June 2013 and to achieve attainment, implementation, maintenance, and enforcement of the NAAQS by August 2017. Id. at 35, 577.

C. The New Jersey Department of Environmental Protection's Section 126(b) Petition

On September 17, 2010, the State of New Jersey Department of Environmental Protection (the “NJ Department”) filed a petition under Section 126(b) of the Clean Air Act, 42 U.S.C. § 7426(b), (the “Section 126(b) petition”), requesting that the EPA issue an order restricting sulfur dioxide emissions from Portland. Specifically, the NJ Department requested that the EPA make a finding that the trans-boundary sulfur dioxide emissions from the nearby Portland plant significantly contribute to nonattainment and/or interfere with maintenance of the 1–hour SO2 NAAQS in New Jersey. In support of its petition, the NJ Department submitted air quality and aerial dispersion modeling analyses ⁴ to show that emissions from Portland cause violations of the 1–hour SO2 NAAQS in Warren, Sussex, Morris, and Hunterdon Counties in New Jersey.

On April 7, 2011, the EPA published a proposed response to the NJ Department's Section 126(b) petition, finding that sulfur dioxide emissions from Portland violate the interstate air pollution transport provisions of the Clean Air Act and suggesting emissions limitations and compliance schedules to remedy the problem. SeeResponse to Petition from New Jersey Regarding SO2 Emissions from the Portland Generating Station, 76 Fed.Reg. 19,662 (Apr. 7, 2011) (to be codified at 40 C.F.R. pt. 52) (“Proposed Rule”). The EPA invited public comments on the Proposed Rule and announced a public hearing to be held on April 27, 2011 in Warren County, New Jersey. The EPA received numerous public comments from inter alia, individuals, government officials, environmental groups, the Pennsylvania Department of Environmental Protection, the NJ Department, GenOn, and the American Lung Association of the Mid–Atlantic. Many of these comments favored the Proposed Rule. The Pennsylvania Department of Environmental Protection submitted a comment in which it acknowledged that residents of Pennsylvania would realize public health and environmental benefits from a reduction in sulfur dioxide emissions but suggested some alterations to the proposed compliance schedule.

On November 7, 2011, the EPA issued its final rule granting the NJ Department's Section 126(b) petition, which finds that Portland's sulfur dioxide emissions significantly contribute to nonattainment and interfere with maintenance of the 1–hour SO2 NAAQS in New...