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Alaska v. EPA

Citation: 32 ELR 20793
No. Nos. 00-70166 et al., 298 F.3d 814/(9th Cir., 07/30/2002)

The court holds that the U.S. Environmental Protection Agency (EPA) did not abuse its discretion or act arbitrarily or capriciously in invalidating a state-granted prevention of significant deterioration (PSD) permit and finding that a state environmental agency's best available control technology (BACT) determination did not comply with the Clean Air Act (CAA). A mine operator in a remote location submitted an application to the state environmental agency requesting permission to increase the amount of nitrogen oxides (NOx) emitted from one of its generators and specifying the technology it intended to use. The state agency found that a different, more costly technology was BACT for the generator. The mine operator then amended its application, offering to implement the less costly technology on all six of its generators, including those not subject to BACT standards, and on a proposed seventh generator. The state agency accepted the operator's proposal because it would reduce total NOx output from the mine to a level comparable to that which would result if the more costly technology were installed on one existing generator and the proposed new generator. In a letter to the state agency, EPA stated that the more costly technology was BACT for the two generators at issue and that the PSD program does not allow the imposition of a limit that is less stringent than BACT even if the equivalent emission reductions are obtained by imposing new controls on other emission units. EPA then issued three enforcement orders stating that the state's authorization of the mine's construction and installation of new equipment was not in compliance with the CAA and the state's state implementation plan.

The court first holds that the plain text, structure, and history of the CAA compel the conclusion that the administrative orders fell within EPA's enforcement and oversight authority. Because EPA based its orders on the finding that the state agency had not complied with the BACT requirement, the orders were authorized by the plain language of CAA §§ 113(a)(5) and 167. The legislative history of the Act further supports EPA's authority to issue the enforcement orders. Although the state has discretion to make BACT determinations as the permitting authority, the CAA provides for EPA enforcement when the state issues a permit based on an improper determination. And while CAA § 169(3) gives the state discretion to determine BACT, nothing in § 169(3)'s definition of BACT limits EPA's authority. Thus, the state's BACT determination is not insulated from the oversight and enforcement authority assigned to EPA in other sections of the CAA. The court next holds that EPA was not arbitrary or capricious in determining that the state agency's BACT determination did not fulfill all requirements of the CAA. A state agency report shows that the mine failed to meet its burden of demonstrating that the more costly technology was economically infeasible, and the state agency failed to provide a reasoned justification for its elimination of the more costly technology as a control option.

Counsel for Petitioner
Cameron M. Leonard, Ass't Attorney General
Attorney General's Office
1031 W. 4th Ave., Ste. 200, Anchorage AK 99501
(907) 451-8211

Counsel for Respondent
Andrew J. Doyle
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000

Wardlaw, J. Before Reinhardt and Gould, JJ.