Puerto Rican Cement Co., Inc. v. U.S. E.P.A., 89-1070
| Decision Date | 15 September 1989 |
| Docket Number | No. 89-1070,89-1070 |
| Citation | 889 F.2d 292 |
| Parties | , 58 USLW 2292, 20 Envtl. L. Rep. 20,259 PUERTO RICAN CEMENT COMPANY, INC., Petitioner, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, Respondent. . Heard |
| Court | U.S. Court of Appeals — First Circuit |
Grant S. Lewis, with whom Daniel R. Dominguez, Dominguez & Totti, G.S. Peter Bergen, Ronald J. Gizzi and LeBoeuf, Lamb, Leiby & MacRae were on brief for petitioner.
Michael A. McCord, Atty., Dept. of Justice, Land and Natural Resources Div., with whom Donald A. Carr, Acting Asst. Atty. Gen., Land and Natural Resources Div., Michael S. Winer, Jeffrey B. Renton Attys., Office of Gen. Counsel, and Joseph A. Siegel, Office of Regional Counsel, U.S.E.P.A., were on brief for respondent.
Before BOWNES and BREYER, Circuit Judges, and FAIRCHILD, * Senior Circuit Judge.
The Puerto Rican Cement Co. (the "Company") wishes to build a new cement kiln, replacing older kilns that it now operates at about 60 percent of their capacity. If operated to achieve about the same level of production, the new kiln will pollute far less than the older kilns; but, if the Company operates the new kiln at significantly higher production levels, it will emit more pollutants than did the older kilns. The Environmental Protection Agency, noting that it is possible that the new kiln will produce more pollution, has held that the Company cannot build it without obtaining a special kind of EPA approval, required when one wishes to "construct" a "major emitting facility" in a place where the air is particularly clean. The Company appeals. We find that EPA's determination is lawful.
1. Factual: The Company's cement plant contains six kilns, which produce a fine powder called "clinker." In 1987 the Company decided to convert Kiln No. 6 from a "wet," to a "dry," cement-making process, and to combine that kiln with Kiln No. 3. At that time, Kilns 3 and 6 were operating at about 60 percent of their combined capacity, producing about 424,000 tons of clinker per year. The converted kiln would have a total capacity of 961,000 tons of clinker per year, or about 35 percent more than the 705,000 ton capacity of Kilns 3 and 6. At any given level of production, the new kiln would emit less air polluting substance than the two older kilns combined, and would use less fuel to boot. However, if the Company decided to operate the new kiln close to its capacity, it might produce both more clinker and more pollution than the old kilns produced when operated at 60 percent of their capacity. In particular, information submitted by the Company suggests the following:
Pounds of Emissions per Ton of Clinker Produced
NO subx SO sub2 PM
Old (Wet) Process 4.9 6.32 0.234
New (Dry) Process 2.6 4.01 0.133
Fig. 1: Comparative Emissions Rates
Tons of Emissions Per Year
NO subx SO sub2 PM
Old (Wet) Process
/Actual (operated at 1100 1340 49.6
about 60% of capacity)
/Potential 1745 2230 82.6
New (Dry) Process
/Actual 578 850 28.2
/Potential (operated 1250 1927 64.0
at full capacity)
Fig. 2: Comparative Emissions Amounts These charts show the rate and amount of emissions of three pollutants: nitrogen oxides, sulfur dioxide, and particulate matter. The "Actual" rate of production is the average rate for Kilns 3 and 6 for the years 1985-86, or 424,000 tons; the "Potential" rate equals 705,000 tons of clinker per year for the old wet process and 911,000 tons of clinker per year for the new dry process. The emboldened numbers are those used by EPA in comparing actual emissions of the old kilns with potential emissions of the proposed new kiln. The charts make clear that emissions will increase only if the company operates the new kiln at significantly higher production levels.
2. Legal: Since the cement plant is located near Ponce, Puerto Rico, where the air quality is better than national ambient air quality standards, new construction is subject to PSD provisions contained in Part C of Title I of the Clean Air Act. See 42 U.S.C. Secs. 7470-7479. That part of the Act says that "[n]o major emitting facility ... may be constructed in any [such] area" without various specified studies, reviews, demonstrations of compliance with certain substantive standards, and the issuance of a permit. See 42 U.S.C. Sec. 7475 (emphasis added). The Act defines "major emitting facility" as a "stationary source[ ] of air pollutants," including Portland Cement plants that "emit, or have the potential to emit, one hundred tons per year or more of any air pollutant" (such as the facilities at issue here). 42 U.S.C. Sec. 7479(1). It defines "construction" to include "modification," which it says
means any physical change in, or change in the method of operation of, a stationary source which increases the amount of any air pollutant emitted by such source or which results in the emission of any air pollutant not previously emitted.
42 U.S.C. Secs. 7411(a)(4), 7479(2)(C). The Act also provides that EPA itself must review the construction proposal and provide the necessary approvals where, as here, no EPA-approved "state implementation plan" is in effect. See 42 U.S.C. Sec. 7478; 40 C.F.R. 52.21(a).
Because the permitting process is costly and time-consuming, EPA has developed an informal system for determining whether or not a particular construction proposal does, or does not, fall within the scope of the PSD permit law. If EPA decides that PSD review is unnecessary, it issues a "non-applicability determination" (known as a "NAD").
3. Proceedings: On July 9, 1987, the Company asked EPA for a NAD. It submitted information to EPA over an eight-month period. On August 30, 1988, EPA denied the Company the NAD. The Company has appealed EPA's determination to this court. Subsequent to the docketing of this appeal the Company and EPA agreed that, if the Company loses this appeal, it will operate its new facility at a sufficiently low capacity to prevent any actual increase in emissions levels. EPA will then issue a NAD, see 40 C.F.R. 52.21(b)(4) (), but the Company will lose its right to ask for a PSD permit, thereby giving up the possibility of obtaining EPA's approval for an increase of emissions.
The Company can appeal the EPA's decision denying a NAD only if that decision is a "final action of the administrator." 42 U.S.C. Sec. 7607(b)(1); cf. 5 U.S.C. Sec. 704 (). As other courts have recognized, see Hawaiian Elec. Co. v. EPA, 723 F.2d 1440, 1442-44 (9th Cir.1984), one might question the "finality" of such a decision either 1) because the agency must take further action to obtain an enforceable order (a problem of "ripeness"), or 2) because the Company can take further administrative steps (i.e., it can invoke the PSD review process) and thereby perhaps obtain the permission to build that it seeks (a problem of "exhaustion of administrative remedies").
The first of these problems--that of "ripeness"--is not particularly serious here. Even though the NAD denial does not, by itself, order the Company to refrain from building (EPA would have to bring an enforcement action to stop the Company from building, see 42 U.S.C. Sec. 7477), it is well established that "ripeness" turns not upon such formal considerations, but rather upon such functional considerations as "the fitness of the issues for judicial decision and the hardship to the parties of withholding court consideration." Abbott Laboratories v. Gardner, 387 U.S. 136, 149, 87 S.Ct. 1507, 1515, 18 L.Ed.2d 681 (1967). (But compare Justice Brandeis' now-outdated description of finality in United States v. Los Angeles & Salt Lake R.R. Co., 273 U.S. 299, 309-310, 47 S.Ct. 413, 414, 71 L.Ed. 651 (1927)). Here, the EPA's position on the legal question (of PSD applicability) is final and authoritative; court review will not "deprive the agency of the opportunity to refine, revise or clarify the ... matter at issue." Roosevelt Campobello Int'l Park Comm'n v. EPA, 684 F.2d 1034, 1040 (1st Cir.1982). Moreover, the fact-based record makes the legal issue "sufficiently concrete" to permit a court's focused attention. Id. At the same time, to withhold review would work considerable hardship on the Company, forcing it either to abandon its building plans, to compromise them by agreeing to emissions limitations, or to engage in a long, costly PSD review process. Under these circumstances, we consider the issue sufficiently "ripe." See Abbott Laboratories, 387 U.S. at 148-49, 87 S.Ct. at 1515-16; Hawaiian Elec. Co., 723 F.2d at 1443. Cf. Roosevelt, 684 F.2d at 1040 ().
The second problem is more serious. The Company, in a sense, may not yet have "exhausted" its agency remedies; in principle it could, by following the PSD review procedures, possibly obtain from EPA permission to build the new kiln and to operate it at whatever levels it wishes. Of course, it is most unlikely that EPA, in the process, will reverse its determination that PSD review applies to the kiln. But, that fact does not end the matter, both because the Company may obtain a form of building permission and because the Supreme Court has...
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