Voices v. State Air Pollution Control Bd., Record No. 2199-09-2.

Citation693 S.E.2d 295,56 Va.App. 282
Decision Date25 May 2010
Docket NumberRecord No. 2199-09-2.
PartiesAPPALACHIAN VOICES, Chesapeake Climate Action Network, Sierra Club and Southern Appalachian Mountain Stewardsv.STATE AIR POLLUTION CONTROL BOARD and Virginia Electric and Power Company.
CourtCourt of Appeals of Virginia

COPYRIGHT MATERIAL OMITTED

Caleb A. Jaffe (John T. Suttles; Southern Environmental Law Center, Charlottesville, on briefs), for appellants.

Kerri L. Nicholas, Assistant Attorney General (Kenneth T. Cuccinelli, II, Attorney General; Roger L. Chaffe, Senior Assistant Attorney General, on brief), for appellee State Air Pollution Control Board.

Timothy G. Hayes (Kevin J. Finto; Miranda R. Yost; Andrea W. Wortzel; Hunton & Williams LLP, on brief), Richmond, for appellee Virginia Electric and Power Company.

Present: FELTON, C.J., HUMPHREYS, J., and CLEMENTS, S.J.

CLEMENTS, Judge.

Appalachian Voices, Chesapeake Climate Action Network, Sierra Club, and Southern Appalachian Mountain Stewards (collectively “the Coalition”) appeal a decision of the circuit court affirming a decision of the State Air Pollution Control Board (the Board) to issue a permit pursuant to the Prevention of Significant Deterioration Program (PSD permit) to Virginia Electric and Power Company (Dominion) to build and operate a coal-fired electric generating plant in Wise County, Virginia. On appeal, the Coalition contends the circuit court erred by: (1) concluding that carbon dioxide (CO2) is not a pollutant “subject to regulation” by the Board and under the federal Clean Air Act (CAA); and (2) approving the Board's use of the more coarse particulate matter pollutant, PM10, as a surrogate for the regulation and control of the more fine particulate matter pollutant, PM2.5, without demonstrating that it was reasonable to do so. We affirm the decision of the circuit court.

BACKGROUND

In accordance with familiar principles of appellate review, we review the facts in the light most favorable to sustaining the Board's action.” Crutchfield v. State Water Control Bd., 45 Va.App. 546, 553-54, 612 S.E.2d 249, 253 (2005) (citing Atkinson v. Virginia Alcohol Beverage Control Comm'n, 1 Va.App. 172, 176, 336 S.E.2d 527, 530 (1985)).

The CAA, 42 U.S.C. § 7401 et seq., requires applicants seeking to construct major sources of air pollution in attainment areas, such as Dominion's proposed coal-fired facility, to undergo New Source Review (NSR) and obtain a PSD permit prior to construction. 42 U.S.C. § 7475. The PSD permit includes limitations or conditions to ensure that emissions from the permitted facility: (1) will not cause or contribute to violations of the National Ambient Air Quality Standards (NAAQS) established by the CAA; and (2) will be controlled sufficiently to maintain existing air quality in the surrounding region. Although the PSD program is federal law, the Department of Environmental Quality (DEQ) and the Board have authority to issue PSD permits because Virginia has an EPA approved “State Implementation Plan” (SIP), giving the Commonwealth primary responsibility to administer the PSD program. See Code § 10.1-1322 et seq.

As part of the permitting process, DEQ must conduct an air quality analysis and control technology review. PSD permits also contain emissions limits for certain pollutants that represent those obtainable by the use of best available control technology (BACT) as determined for the source. 42 U.S.C. § 7475(a)(4). BACT means, in pertinent part: [a]n emissions limitation ... based on the maximum degree of reduction for each regulated NSR pollutant that would be emitted from any proposed major stationary source....” 9 VAC 5-80-1615 (emphasis added).

In July 2006, Dominion filed its application for the PSD permit to build and operate a coal-fired electric generating facility, the Virginia City Hybrid Energy Center (VCHEC), in order to meet current and projected electricity demand. DEQ published the first draft of the permit in January 2008 with supporting engineering analysis. Prior to the issuance of the final permit, Dominion also undertook studies, modeling, analysis and technology, review. During the public comment period, the Coalition raised several concerns about the draft permit. On June 25, 2008, the Board approved the PSD permit, which was issued on June 30, 2008.

The Coalition filed a petition for appeal in the circuit court in August 2008, raising several challenges to the Board's approval of the PSD permit. The Coalition argued that the PSD permit should have included emission limits for CO2 and the Board erred by failing to require BACT analysis for CO2. DEQ and Dominion responded that neither state nor federal law requires regulation of CO2 and, at the time of the permitting process, there was no guidance for the development of CO2 emissions standards. The circuit court agreed with DEQ and Dominion, finding there was no legal requirement that the Board conduct a BACT analysis for CO2 because CO2 is not subject to regulation under either federal or state law.

The Coalition also argued to the circuit court that the Board improperly relied on guidance from the Environmental Protection Agency (EPA) relating to the use of PM10 as a surrogate for PM2.5.

EPA has established NAAQS for both PM10 and PM2.5. These are standards for particulate matter (soot) less than 10 micrometers in diameter, PM10, and less than 2.5 micrometers in diameter, PM2.5. The Coalition asserted to the circuit court that the PM2.5 limit in the PSD permit was unlawful because the Board relied upon antiquated EPA guidance relating to the use of PM10 as a surrogate for PM2.5. The Coalition argued that the Board should have applied a BACT analysis to determine whether the surrogacy was appropriate in this particular case.

In response, DEQ and Dominion asserted that DEQ and the Board consistently followed EPA's recommended procedure and DEQ's own guidance for implementing the procedure for using PM10 as a surrogate for PM2.5. In addition, Dominion provided modeling that demonstrated compliance with the PM2.5 NAAQS. Moreover, the Board included a provision in the PSD permit requiring review of the existing permit emission limit for PM2.5 when the final PM2.5 implementation guidance is promulgated by EPA. The PSD permit also requires PM2.5 ambient air quality monitoring to begin upon commercial start up of the facility.

The circuit court ruled that there was substantial evidence in the record to support the Board's approach to controlling PM2.5 emissions “for the reasons stated in the briefs and oral arguments” of the Board and Dominion.

By order entered on September 2, 2009, the circuit court affirmed the decision of the Board to issue the PSD permit. The Coalition appealed the circuit court's decision to this Court.

STANDARD OF REVIEW FOR CARBON DIOXIDE ISSUE

Judicial review of the Board's decision to issue the permit is governed by the Virginia Administrative Process Act.Code § 2.2-4000 et seq. The burden is on the Coalition to designate and demonstrate an error of law for the court to review. Code § 2.2-4027.

Questions of law are reviewed de novo. See Clark v. Marine Res. Comm'n, 55 Va.App. 328, 334-35, 685 S.E.2d 863, 866 (2009) (citing Moreau v. Fuller, 276 Va. 127, 133, 661 S.E.2d 841, 845 (2008)). [J]udicial review of a ‘legal issue’ requires ‘little deference,’ unless it ... ‘falls within an agency's area of particular expertise.’ Envtl. Defense Fund, Inc. v. State Water Control Bd., 15 Va.App. 271, 278, 422 S.E.2d 608, 612 (1992) (quoting Johnston-Willis v. Kenley, 6 Va.App. 231, 243-46, 369 S.E.2d 1, 8 (1988)). “Whether the issue is one of law or fact or substantial evidence, we are directed to ‘take account of the role for which agencies are created and public policy as evidenced by the basic laws under which they operate.’ Johnston-Willis, 6 Va.App. at 244, 369 S.E.2d at 8 (citing Revisor's Note to former Code § 9-6.14:17). “Thus, the degree of deference afforded an agency decision depends upon not only the nature of the issue, legal or factual, but also upon whether the issue falls within the area of ‘experience and specialized competence of the agency.’ Id. at 243, 369 S.E.2d at 8 (citing former Code § 9-6.14:17, recodified as Code § 2.2-4027).

“The basic law under which the Commissioner acts and the purposes of the law are crucial to the determination of a reviewing court.” Id. (citing Virginia Alcoholic Beverage Control Comm'n v. York Street Inn, Inc., 220 Va. 310, 313, 257 S.E.2d 851, 853 (1979)). The General Assembly has authorized the Board and DEQ to grant and enforce permits for the construction and operation of major sources of air pollution within the Commonwealth “to protect all aspects of Virginia's environment.” Code § 10.1-1183. See also Code § 10.1-1322. In addition, the General Assembly has authorized the Board to promulgate regulations abating, controlling, and prohibiting pollution throughout the Commonwealth. Code § 10.1-1308.

We conclude that the CO2 question involves a question of law, however, we also take into account that the issue falls within the area of “experience and specialized competence” of the Board as the agency authorized by the General Assembly to issue PSD permits.

CARBON DIOXIDE ISSUE

The CAA requires permitting agencies to undertake a BACT analysis for each pollutant that “is subject to regulation” under the CAA. 42 U.S.C. § 7475(a). The term “subject to regulation” is not defined in the CAA. Since 1993, EPA has implemented only monitoring, reporting, and record keeping requirements concerning CO2. See 40 C.F.R. § 75.1.

The Coalition concedes that there are no federal or state standards or emission limitations for CO2. However, they contend that CO2 is a pollutant “subject to regulation” under the CAA based on EPA's monitoring, reporting, and record keeping regulations for CO2. Thus, the Coalition asserts that the PSD permit should have included emission limits for CO2. The Coalition also argues the Board...

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