U.S. v. Duke Energy Corp., 1:00CV1262.

• Decision Date: 06 September 2001
• Docket Number: No. 1:00CV1262.,1:00CV1262.
• Citation: 171 F.Supp.2d 560
• Court: U.S. District Court — Middle District of North Carolina
• Parties: UNITED STATES of America, Plaintiff, v. DUKE ENERGY CORPORATION, Defendant.

171 F.Supp.2d 560

UNITED STATES of America, Plaintiff, v. DUKE ENERGY CORPORATION, Defendant.

No. 1:00CV1262.

United States District Court, M.D. North Carolina.

September 6, 2001.

Gill P. Beck, Office of U.S. Attorney, Greensboro, NC, Lois J. Schiffer, U.S. Dept. of Justice, Environmental & Natural Resources Division, Washington, DC, Sonja Petersen, Jason Dunn, John C. Cruden, U.S. Dept. of Justice, Environmental Enforcement Sect., Washington, DC, Alan Dion, U.S. Environmental Protection Agency, Office of Regional Counsel, Atlanta, GA, for United States.

James Blanding Holman, IV, Southern Environmental Law Center, Chapel Hill NC, Jeffrey M. Gleason, Southern Environmental Law Center, Charlottesville, VA, for Environmental Defense, North Carolina Sierra Club, and North Carolina Public Interest Research Group Citizen Lobby/Education Fund.

Daniel W. Fouts, Robert Harper Heckman, Adams, Kleemeier, Hagan, Hannah & Fouts, Greensboro, NC, Albert Diaz, T. Thomas Cottingham, III, Nash E. Long, III, Hunton & Williams, Charlotte, NC, Garry Stephen Rice, Duke Energy Corp., Charlotte, NC, Mark B. Bierbower, Henry V. Nickel, William F. Brownell, Makram Jaber, Hunton & Williams, Washington, DC, for Defendant.

MEMORANDUM OPINION

BULLOCK, District Judge.

This matter is before the court on a motion to intervene as plaintiffs by various environmental groups. These groups are Environmental Defense, North Carolina Sierra Club, and North Carolina Public Interest Research Group Citizen Lobby/Education Fund (hereinafter collectively referred to as "Applicants"). Applicants' motion to intervene is made pursuant to Rules 24(a) and 24(b) of the Federal Rules of Civil Procedure. For the following reasons, the court finds that Applicants have an unconditional statutory right to intervene, and Applicants' motion will be granted pursuant to Federal Rule of Civil Procedure 24(a)(1).

FACTS

The Attorney General of the United States, acting at the request of the Administrator of the United States Environmental Protection Agency, filed this action against Defendant Duke Energy Corporation ("Duke Energy") on December 22, 2000. The suit alleges that Duke Energy made modifications to and operated eight coal-fired electrical generating plants in North Carolina and South Carolina in violation of the Clean Air Act (the "Act"), 42 U.S.C. § 7401 et seq.

The Prevention of Significant Deterioration ("PSD") provisions of the Clean Air Act, 42 U.S.C. §§ 7470-92, prohibit the modification and operation of any "major emitting facility," such as Duke Energy's electrical generating plants, unless a permit has been issued. The United States contends that Duke Energy modified and operated its electrical generating plants without first obtaining the permits required by the Act.

The State Implementation Plans for North Carolina and South Carolina, enacted pursuant to the Clean Air Act, require state permits prior to certain modifications to "major stationary sources." The Duke Energy plants at issue qualify as "major stationary sources." The United States alleges that Duke Energy failed to obtain the required state permits prior to the modification and operation of its electrical generating plants.

On May 8, 2001, Applicants moved to intervene as plaintiffs. Applicants are public-interest organizations focusing on environmental protection issues. Altogether these organizations claim over 26,000 members in North Carolina.

ANALYSIS

Federal Rule of Civil Procedure 24(a), entitled "Intervention of Right," provides in part that "[u]pon timely application anyone shall be permitted to intervene in an action ... when a statute of the United States confers an unconditional right to intervene." Fed.R.Civ.P. 24(a)(1). Applicants contend that their motion to intervene is timely and that Section 304 of the Clean Air Act, the Act's citizen suit provision, confers an unconditional right to intervene. Duke Energy does not dispute that the motion to intervene is timely. Duke Energy argues, however, that Section 304 provides no right to intervene in the type of lawsuit brought by the United States.

Section 304(a)(1) of the Clean Air Act states that "any person may commence a civil action on his own behalf against any person ... who is alleged to have violated (if there is evidence that the alleged violation has been repeated) or to be in violation of an emission standard or limitation under [Chapter 85 of the Clean Air Act]." 42 U.S.C. § 7604(a)(1) (emphasis added). This right to bring suit is limited by Section 304(b)(1)(B) of the Act, which provides in part:

No action may be commenced under subsection (a)(1) of this section [alleging the violation of an emission standard or limitation] ... if the Administrator [of the EPA] or State has commenced and is diligently prosecuting a civil action in a court of the United States or a State to require compliance with the standard, limitation, or order, but in any such action in a court of the United States any person may intervene as a matter of right.

42 U.S.C. § 7604(b)(1)(B) (emphasis added). Thus, Section 304(b)(1)(B) curtails the right to initiate a citizen suit under Section 304(a)(1), but permits intervention as a matter of right. Applicants contend that because the civil action commenced by the United States against Duke Energy alleges the violation of an "emission standard or limitation," as that term is defined in the Clean Air Act, Section 304(b)(1)(B) provides Applicants with an unconditional right to intervene.

Section 304(f)(4) of the Clean Air Act sets forth the definition of "emission standard or limitation" as the term is used in Chapter 85 of the Act (the chapter that includes the citizen suit and PSD provisions). Under that definition, "emission standard or limitation" includes "any permit term or condition, and any requirement to obtain a permit as a condition of operations which is in effect under [Chapter 85] ... or under an applicable implementation plan." 42 U.S.C. § 7604(f)(4) (emphasis added). The action brought by the United States against Duke Energy alleges that Duke Energy failed to obtain permits to modify eight coal-burning electrical generating plants as required by the PSD provisions of the Clean Air Act and the State Implementation Plans of North Carolina and South Carolina. Therefore, Applicants contend that the suit initiated by the United States alleges the violation of an "emission standard or limitation," and Section 304(b)(1)(B) provides an unconditional statutory right to intervene. See Illinois v. Commonwealth Edison Co., 490 F.Supp. 1145, 1150 (N.D.Ill.1980) (holding that the failure to obtain a permit as required by state regulation establishes a claim under Section 304(a)(1) of the Clean Air Act).

Duke Energy provides two responses to Applicants' assertion of an unconditional statutory right to intervene. First, Duke Energy contends that a permit authorizing the modification of a major emitting facility, which the Government alleges Duke Energy failed to obtain, is not a "permit as a condition of operations" and therefore does not come within the Section 304(f)(4) definition of "emission standard or limitation." Duke Energy contends that the permits it allegedly needed were "construction permits" rather than the permits required as "condition[s] of operations" referred to in Section 304(f)(4). As a result, Duke Energy concludes that the failure to obtain the purportedly required permits is not an alleged violation of an "emission standard or limitation," and Section 304(b)(1)(B) does not provide a statutory right to intervene.

The process of obtaining a permit to modify a major emitting facility involves the determination of best available control technology ("BACT") for pollutants emitted by the particular facility. See 42 U.S.C. § 7475(a)(4). This determination is done on a case-by-case basis, taking into account "energy, environmental, and economic impacts and other costs." 42 U.S.C. § 7479(3). The implementation of BACT is a condition of operation because the Administrator or State may bring an enforcement action seeking injunctive relief for the alleged failure to apply best available control technology. See 42 U.S.C. § 7477. Thus, the requirement of obtaining a construction permit amounts to a condition of operations. The permitting process involves the determination of BACT. Absent the proper implementation of BACT, an electrical generator may be enjoined from operating.

Duke Energy also argues that accepting Applicants' position that the failure to obtain a construction permit amounts to a violation of an "emission standard or limitation" renders Section 304(a)(3) of the Act superfluous. Section 304(a)(3) provides in pertinent part:

[A]ny person may commence a civil action on his own behalf ... against any person who proposes to construct or constructs any new or modified major emitting facility without a permit required under part C of subchapter I of this chapter (relating to significant deterioration of air quality) or part D of subchapter I (relating to nonattainment) or who is alleged to have violated (if there is evidence that the alleged violation has been repeated) or to be in violation of any condition of such permit.

42 U.S.C. § 7604(a)(3). Duke Energy contends that this is exactly the type of action that the government has brought, a suit alleging modification of major emitting facilities without the permits required by the PSD provisions of the Clean Air Act. Unlike an action brought by the government to enforce an emission standard or limitation, the Act does not provide an express statutory right to intervene in a government-initiated action alleging modification of a major emitting facility without a permit.

Applicants agree with Duke Energy that the action brought by the government alleges the type of conduct that could support an action under Section 304(a)(3) of the Act. Applicants contend, however, that Section 304(a)(3) is not the...