Maryland v. Envtl. Prot. Agency

• Decision Date: 19 May 2020
• Docket Number: No. 18-1285,C/w 18-1287, 18-1301,18-1285
• Citation: 958 F.3d 1185
• Parties: State of MARYLAND, Petitioner v. ENVIRONMENTAL PROTECTION AGENCY, Respondent City of New York, et al., Intervenors
• Court: U.S. Court of Appeals — District of Columbia Circuit

958 F.3d 1185

State of MARYLAND, Petitioner

v. ENVIRONMENTAL PROTECTION AGENCY, RespondentCity of New York, et al., Intervenors

No. 18-1285

C/w 18-1287, 18-1301

United States Court of Appeals, District of Columbia Circuit.

Argued January 16, 2020

Decided May 19, 2020

William J. Kassab, Deputy Attorney General, Office of the Attorney General for the State of Delaware, argued the cause and filed the briefs for petitioner State of Delaware.

Joshua Berman, Washington, DC, argued the cause for Citizen Petitioners. With him on the briefs were Ariel Solaski, Jon A. Mueller, Washington, DC, Leah Kelly, Ann Brewster Weeks, Graham McCahan, Sean H. Donahue, and Susannah L. Weaver, Washington, DC. Hayden W. Hashimoto entered an appearance.

Michael F. Strande, Assistant Attorney General, Office of the Attorney General for the State of Maryland, argued the cause for petitioner State of Maryland. With him on the briefs were Brian E. Frosh, Attorney General, and Joshua M. Segal, Special Assistant Attorney General.

Letitia James, Attorney General, Office of the Attorney General for the State of New York, Morgan A. Costello and Claiborne E. Walthall, Assistant Attorneys General, Barbara D. Underwood, Solicitor General, Steven Wu, Deputy Solicitor General, David S. Frankel, Assistant Solicitor General, Gurbir S. Grewal, Attorney General, Office of the Attorney General for the State of New Jersey, Aaron A. Love, Deputy Attorney General, and Christopher G. King, Houston, TX, were on the brief for petitioner-intervenors State of New York, et al.

Richard L. Revesz and Jack Lienke were on the brief for amicus curiae Institute for Policy Integrity at New York University School of Law in support of petitioners.

Samara M. Spence, Attorney, U.S. Department of Justice, argued the cause for respondent. With her on the brief were Jeffrey Bossert Clark Sr., Assistant Attorney General, Jonathan Brightbill, Principal Deputy Assistant Attorney General, and Abirami Vijayan and Stephanie L. Hogan, Counsel, U.S. Environmental Protection Agency.

Norman W. Fichthorn, E. Carter Chandler Clements, Washington, DC, Garry S. Rice, Rae E. Cronmiller, Arlington, VA, and Janet J. Henry, Columbus, OH, were on the brief for respondent-intervenors.

Before: Henderson, Garland, and Katsas, Circuit Judges.

Per Curiam:

The Clean Air Act, 42 U.S.C. §§ 7401 et seq. , charges the United States Environmental Protection Agency (EPA) with regulating air pollution, including ozone. Clean Air Act section 110 requires individual states to adopt plans for the implementation and enforcement of EPA-mandated national air quality standards. Id. § 7410. But because pollutants are readily transported across large areas, without regard to state boundaries, upwind emissions can impede downwind states’ attainment of the national standards. To address this unequal burden, section 110 includes a "Good Neighbor Provision," which requires state plans to prohibit emissions that will "contribute significantly" to nonattainment in any other state. Id. § 7410(a)(2)(D)(i)(I). The EPA has developed a four-step framework to address Good Neighbor obligations in this context. At Step One, it identifies downwind areas projected to have trouble attaining the relevant air quality standard. At Step Two, the EPA determines which upwind states are "linked" to the downwind nonattainment sites. At Step Three, it calculates the optimal level of pollution control, considering the marginal cost of emission reductions and anticipated downwind air quality improvements. The EPA then formulates an emissions budget for each state, accounting for achievable reductions. Finally, at Step Four, the EPA typically promulgates federal implementation plans that require upwind states’ participation in a regional cap-and-trade program to bring about compliance with their Good Neighbor obligations.

Separately, Clean Air Act section 126(b) authorizes "[a]ny State" to petition the EPA for a finding that an upwind source "emits or would emit" in violation of the Good Neighbor Provision’s prohibition. Id. § 7426(b). If the EPA makes the requested finding, the offending source must cease operations unless it complies with federally enforceable emission limitations. In 2016 Maryland and Delaware filed section 126(b) petitions requesting that the EPA impose additional limitations on certain upwind sources that were purportedly contributing to the two States’ nonattainment of the national ozone standards. Both States sought to require the optimization of existing selective catalytic reduction controls; Maryland also addressed the operation of selective non-catalytic reduction controls at two facilities and Delaware requested that one facility burn only natural gas.

The EPA denied the petitions on October 5, 2018. Because a section 126(b) petition seeks a finding that the upwind source has violated the Good Neighbor provision, the EPA applies the same four-step framework it developed in the implementation of section 110. The EPA denied Delaware’s petitions at Step One, finding that Delaware had not demonstrated a current or future in-state air quality problem and that, under the EPA’s own modeling, no such problem would exist under either the 2008 or 2015 ozone standards. Alternatively, the EPA concluded that denial was warranted under Step Three because Delaware failed to identify any available cost-effective controls at the named sources. Although Maryland survived Steps One and Two, the EPA denied its petition at Step Three. Like Delaware, Maryland failed to identify further cost-effective emission reductions at sources operating with catalytic controls. For the remaining sources named in Maryland’s petition, the EPA explained that non-catalytic controls were not cost-effective in this context. Maryland, Delaware and a coalition of environmental groups (Citizen Petitioners) petition for review of the EPA’s denials. Although we reject some of the EPA’s Step One determinations, we find, with one exception, that it reasonably denied the petitions at Step Three. We conclude, however, that the EPA’s explanation was inadequate with respect to non-catalytic controls. We therefore grant Maryland’s petition for review in part and remand this issue to the EPA. We deny all other petitions for review.

I. Background

A. Statutory Framework

The Clean Air Act instructs the EPA to establish a primary and secondary National Ambient Air Quality Standard (NAAQS), see 42 U.S.C. § 7409, for each air pollutant "which may reasonably be anticipated to endanger public health or welfare," id. § 7408(a)(1)(A).¹ Once established by the EPA, these standards "become the centerpiece of a complex statutory regime aimed at reducing the pollutant’s atmospheric concentration." Am. Trucking Ass’ns, Inc. v. EPA , 283 F.3d 355, 358–59 (D.C. Cir. 2002). The EPA first promulgated the NAAQS for ground-level ozone, i.e., smog, in 1979. See Revisions to the National Ambient Air Quality Standards for Photochemical Oxidants, 44 Fed. Reg. 8202 (Feb. 8, 1979). In 1997 it set the ozone NAAQS at a level of 80 parts per billion (ppb), measured over an eight-hour period. See National Ambient Air Quality Standards for Ozone, 62 Fed. Reg. 38,856 (July 18, 1997). The EPA subsequently reduced the ozone NAAQS to 75 ppb in 2008, see National Ambient Air Quality Standards for Ozone, 73 Fed. Reg. 16,436 (Mar. 27, 2008), and, in 2015, to 70 ppb, see National Ambient Air Quality Standards for Ozone, 80 Fed. Reg. 65,292 (Oct. 26, 2015).

To promote attainment and maintenance of the NAAQS, the "EPA, in coordination with state governments, divides the country geographically into ‘[a]ir quality control region[s].’ " NRDC v. EPA , 777 F.3d 456, 458 (D.C. Cir. 2014) (alterations in original) (quoting 42 U.S.C. § 7407 ). "Some areas lie within a single state while others encompass portions of two or more states." Del. Dep’t of Nat. Res. & Envtl. Control v. EPA , 895 F.3d 90, 94 (D.C. Cir. 2018). Once the EPA issues a new or revised NAAQS, it "designates each area as ‘attainment,’ ‘nonattainment,’ or ‘unclassifiable’ with respect to the NAAQS." Id. (citing 42 U.S.C. § 7407(d)(1)(A), (B) ). An "attainment" area meets the NAAQS, that is, the atmospheric concentration of the regulated pollutant is less than the allowable level; an "unclassifiable" area, as the name suggests, cannot be classified due to the absence of available information; and a "nonattainment" area exceeds the NAAQS or contributes to a violation in a nearby area. 42 U.S.C. § 7407(d)(1)(A)(i)–(iii). Ozone nonattainment areas are further classified by operation of law, according to the severity of their air quality problems, as marginal, moderate, serious, severe, or extreme. Id. § 7511(a)(1). These classifications determine how long the area has in order to attain the primary NAAQS. Id. An ozone nonattainment area that misses its attainment deadline is generally bumped up to the next highest classification, id. § 7511(b)(2)(A), which "impose[s] additional regulatory responsibilities on the states composing that area," Del. Dep’t of Nat. Res. , 895 F.3d at 94.

Following the promulgation of a NAAQS, each state must submit a state implementation plan (SIP) that "provides for implementation, maintenance, and enforcement" of the NAAQS within that state. 42 U.S.C. § 7410(a)(1). For states in nonattainment areas, "SIPs must show how the areas will achieve and maintain the relevant NAAQS." S. Coast Air Quality Mgmt. Dist. v. EPA , 882 F.3d 1138, 1143 (D.C. Cir. 2018). In particular, SIPs for ozone nonattainment areas must adopt certain measures, see, e.g. , id. at 1143–44, intended to bring about attainment "as expeditiously as practicable" and not later than specific statutory deadlines, 42 U.S.C. § 7511(a)(1). If a state fails to submit a SIP, or if its submission is incomplete or disapproved, the EPA must issue a federal implementation plan (FIP) that requires the state to correct the identified deficiency. Id. § 7410(c)(1).

State-level air quality...