Sierra Club v. Union Oil Co.

No. C-84-3435-SC (N.D. Cal. November 5, 1985)

The court rules that a state-issued national pollutant discharge elimination system permit that does not excuse violations caused by "upsets" is nonetheless governed by Environmental Protection Agency (EPA) rules excusing such violations where state law bars state requirements more stringent than those of the federal government. The court first rules that the upset defense in EPA regulations is available to defendant, because California law bars enforcement of state provisions more demanding than those of federal law unless required to ensure compliance with state water quality standards. Since there was no finding that the allowance of upsets by defendant would jeopardize water quality limits, the upset exception must be read into defendant's permit. The court then rules that most of defendant's alleged violations were caused by upsets, unintended conditions reasonably beyond defendant's control. Plaintiffs' evidence indicates that 13 of the alleged 75 violations were not really exceedances of defendant's permit limits. Over 50 exceedances were due to unusually heavy rainfall that in two consecutive winters exceeded the 100-year maximum. Such incidents of excess pollution, the court rules, are beyond defendant's control and qualify as upsets. The court also rules that the few exceedances due to equipment malfunctions were also excused as upsets. Since the violations alleged by plaintiffs were virtually all excusable as upsets, the court grants defendant's motion for summary judgment.

[Other opinions in this case appear at 15 ELR 20890 and 16 ELR 20005.]

Counsel are listed at 16 ELR 20005.

[16 ELR 20007]

Conti, J:

Findings of Fact and Conclusions of Law

This action came on regularly for court trial, without a jury, on October 28, 1985, and lasted for five days. The issues as to liability and damages were bifurcated, with the trial period being concerned with liability only.

The parties herein are: plaintiff Sierra Club, and defendant Union Oil Company of California.

Evidence, both oral and documentary, was introduced on behalf of the parties, and the cause having been submitted for decision on the bifurcated issue of liability, the court, having considered the evidence and pleadings of record, and being fully advised of the premises, makes the following Findings of Fact and Conclusions of Law.

This action is a citizen suit brought under Section 505 of the Clean Water Act, 33 U.S.C. § 1365(a). Plaintiff Sierra Club seeks an injunction and civil penalties against defendant Union Oil for alleged violations of Sections 301 and 402 of the Act, 33 U.S.C. §§ 1311, 1342. Plaintiff alleges that defendant discharged pollutants into San Pablo Bay in violation of effluent limitations established for such pollutants in the National Pollutant Discharge Elimination System (NPDES) permit which covers such discharges.

The violations claimed allegedly occurred during the period June, 1979 through December, 1983, and were allegedly disclosed in Self-Monitoring Reports (SMR's) filed by Union Oil with the San Francisco Bay Regional Water Quality Control Board ("RWQCB").

Union Oil's defense is that the certain alleged violations were not even permit exceedances, much less violations of the permit, that others were excusable as upsets due to two exceptional winter storm years.

Union Oil operates its San Francisco Refinery in Contra Costa County, California, near Rodeo. Pursuant to a National Pollutant Discharge Elimination System ("NPDES") permit issued by the California Regional Water Quality Control Board, Union Oil discharges wastewaters, including process wastewater and storm water runoff, to San Pablo Bay, a navigable waterway.

The initial NPDES permit was adopted on November 19, 1974, as Order No. 74-152. Changes were made to that permit by Order No. 77-148 adopted on December 20, 1977, and by Order No. 79-125 adopted on October 16, 1979. With the exception of the changes made by Order No. 77-148 and Order No. 79-125, Order No. 74-152 remained in effect until March 1, 1980. A revised NPDES permit was adopted on February 19, 1980, as Order No. 80-5. That permit was modified by Order No. 80-45 adopted on September 16, 1980. Order No. 80-5, or Order No. 80-5 as amended by Order No. 80-45, was effective from March 1, 1980, until March 3, 1985. The current NPDES permit was adopted on February 20, 1985, as Order No. 85-29. That permit became effective on March 3, 1985. Union Oil was the sole named permittee from 1974 to March 1, 1980, and from March 3, 1985, to the present.

At all relevant times, the NPDES permit in effect established effluent limitations on the wastewater discharged by Union Oil. The NPDES permit also required Union Oil to perform sampling and analysis of its wastewater, and to report any exceedances of effluent limitations.

At issue in this lawsuit are 75 incidents which Sierra Club alleges represent violations of permit limitations or conditions. A few of the said 75 are termed monthly exceedances, in certain of the instances; an exceedant in one month can affect the monthly average which would amount to an additional exceedant charge; however, the "actual exceedant" violations were less than 75.

Union Oil discharges wastewater at two points — at a point located near monitoring station E-001 and at a point located near monitoring station E-004. The wastewater discharged through monitoring station E-001 typically consists solely of once-through non-contact cooling water which is taken from San Pablo Bay and then returned to San Pablo Bay after being used for cooling purposes. Waste discharged through monitoring station E-004 also includes non-contact cooling water. In addition, the E-004 wastewater includes wastewater treated in the wastewater treatment plan (which is known as Unit 100) and storm water runoff from some areas of the refinery property and from areas surrounding the refinery property.

Union Oil's wastewater treatment plant — Unit 100 — receives water in two separate waste streams. The first waste stream is a segregated process wastewater stream containing relatively high concentrations of organic constituents, including phenols. After cooling, the segregated waste stream is initially routed to a trickling filter at Unit 100 where it receives initial biological treatment. Prior to late December, 1982, the segregated stream was then routed to the primary activated sludge tank where it received further biological treatment. Since late December, 1982, this segregated stream has been routed from the trickling filter to a secondary activated sludge tank. At all time, wastewater from the primary activated sludge tank has been routed to a clarifier, and eventually through E-004 to San Pablo Bay.

The second waste stream is an unsegregated waste stream which consists of process water combined with storm water runoff. The unsegregated waste stream is routed to Unit 100 in the refinery combined sewer system. The unsegregated waste stream first enters an API separator at Unit 100 which relies on gravity separation to remove oil and solids from the wastewater. Union Oil contends that the API separator has a design capacity of at least 7,000 gallons per minute. After treatment in the API, the unsegregated stream is routed to a dissolved air flotation ("DAF") unit. The DAF removes additional oil and solids by a chemical coagulation and [16 ELR 20008] flotation process. Water from the DAF outlet is channelled to feed pumps for the primary activated sludge tank where it is combined with the treated segregated wastewater stream and pumped to the primary activated sludge tank. Union Oil has established that the primary activated sludge clarifier system ("bioplant") was designed normally to treat combined segregated-unsegregated wastewater streams of up to 2,500 gallons per minute. During periods when stormwater runoff or unsegregated wastewater causes the capacity of the bioplant to be exceeded, the excess unsegregated wastewater is designed to be routed around the bioplant after receiving treatment in the API Separator and DAF. The entire segregated wastewater stream normally is treated in the bioplant, even when excess unsegregated wastewater is being routed around the bioplant. When design routing of excess wastewater occurs, the excess wastewater is combined with wastewater treated in the bioplant before entering monitoring station E-002, the principal location where water is sampled to determine whether effluent limitations are being met.

The wastewater treatment plant is designed so that the wastewater streams may be diverted from various locations upstream, within, and downstream of the wastewater treatment plant to two storm basins, the main storm basin and the primary storm basin. The storm basins are also used to store excess wastewater generated during rainstorms for treatment after the rainstorm has abated. The two storm basins have a combined capacity of approximately 9.5 million gallons. The wastewater in the storm basins may then be pumped back into the wastewater treatment plant for treatment.

This case is not the situation where a refiner has been charged with exceedants of its permit that it did not report, either deliberately or through negligence, but, rather, it is a case where the refiner did report its exceedants and complied with the regulations pursuant to reporting the incidents and the giving of its reasons therefor. Here the plaintiff maintained that even though the defendants reported the exceedants, they are still in fact violations for which defendant is liable, and that defendant has no defenses to said violations. The defendant countered with the fact that it did report and comply, and that is has valid reasons and explanations to said exceedants; therefore, its "upset" defenses and explanations are valid defenses and prove no liability on the part of the defendant.

"Upset" means an exceptional incident in which there is unintentional and temporary noncompliance with technology based permit effluent limitations because of factors beyond the reasonable control of the permittee. (40 C.F.R. § 122.41(n)).

In reviewing the evidence, the court finds and concludes that the upset defense is available to defendant in this case, and further finds that the evidence proves that the exceedants alleged by plaintiff are excusable as upsets.

The period in question covers 52 months from June, 1979, through December, 1983, and during said period defendant was required to submit to the Regional Water Quality Control Board approximately 300 separate testing and observations reports per month, or a total of approximately 16,000 reportings. The reports are submitted on a self-monitoring program. Of said 16,000 reporting items that could cause exceedants (violations), the plaintiff claims 75 exceedants during said 52 month period. (The actual number of exceedants is less than 75, because one weekly violation can generate a monthly violation (as aforesaid); therefore, one reported violation can count for two violations.

The following chart indicates the alleged number of violations by month and year:

Alleged Number of Violations By Month and Year

1979 1980 1981 1982 1983

January 2 4 1

February 1 3

March 6 3

April 2 1 15

May

June 1

July 1

August

September 2

October 1 2

November 2 1 2 9

December 1 1 5 8 1

TOTALS 3 5 12 42 13

The chart indicates three exceedants in 1979, five in 1980, then he heavy and extraordinary rains of the winters of 1981-1982 and 1982-1983, caused most of the exceedants at issue.

As aforesaid, during the 1979 through 1983 time frame, Union Oil performed more than 16,000 tests monitoring the constituents contained in its effluent. Less than one half of one percent of those monitoring results formed the subject of this trial. Of those 75 alleged violations, Union Oil presented evidence that thirteen were not even actual exceedances of permit limitations, because the applicable permit limitation either was not exceeded, or because the result was caused by error in wastewater sampling or analysis. Union Oil admitted that the remaining 62 alleged violations were, in fact, permit exceedances reported to the Regional Board by Union Oil. But Union Oil presented evidence that 50 of those exceedances were related to abnormally heavy rainfall occurring, for the most part, during the winters of 1981 to 1982, and 1982 to 1983. The remaining twelve exceedances were attributed by Union Oil to temporary malfunctions of treatment or process equipment or by an unusual operations failure.

The court finds that the winters of 1981 to 1982 and 1982 to 1983 produced exceptionally heavy rainfall, causing widespread flooding and property damage.

In the six month period between November 1981, and April 1982, the defendant experienced an exceptional rainfall of 33 inches, which represented a rainfall that occurs once in a hundred years. In the following rain season (1982-1983), defendant experienced another 33 inch rainfall, which represented a rainfall that occurs once in a hundred years. Therefore, there were two hundred-year rainfalls in sequence.

The above chart of incidents clearly pinpoints the reasonableness of defendant's contentions as to rainfall and overall compliance record. No incident was of such magnitude to justify an exceptional exceedance as to require liability. The reasons proved by defendant justified the non-liability of such exceedance.

The court finds that the rainfall related permit exceedances were caused by factors beyond the reasonable control of Union Oil and are, therefore, excusable as "upsets" within the meaning of 40 C.F.R. § 122.42(n).

Exceedances attributable to temporary malfunctions of equipment also qualify as "upsets" within the meaning of 40 C.F.R. § 122.42(n). Permit limitations are based on the availability of technology to remove the constituents identified in the permit. The evidence at trial revealed that the wastewater treatment plant at Union Oil consisted of equipment which met acceptable practicable control technology standards and which had sufficient capacity to meet permit limitations under all but the most severe circumstances. The evidence establishes that the few exceedances attributed to equipment malfunction were beyond the reasonable control of Union Oil.

Finally, a few exceedances (minor in magnitude), during the five-year period at issue, were caused by very unusual human errors that are excusable in light of time span and number of acceptable readings.

The sum of the credible evidence demonstrates that the 75 exceedances were caused by factors beyond the reasonable control of Union Oil, thereby qualifying as "upsets", and/or excusable reasons and establish no liability on the part of defendant.

Plaintiff has not sustained its burden of proof.

Conclusions of Law

1. This court has jurisdiction over the parties and the subject matter of this action under the Citizen Suit provision of the Clean Water Act, 33 U.S.C. § 1365, and venue is proper in this court.

2. Union Oil is obligated to comply with the terms, conditions, and effluent limitations contained in its NPDES permit, however, it is not responsible for "an exceptional incident in which there is unintentional and temporary non-compliance with technology-based permit effluent limitations because of factors beyond [its] reasonable control . . ." 40 C.F.R. § 122,41(n).

3. The "upset" defense is available to Union Oil, even though its NPDES permit itself contains no upset provision because federal law requires the inclusion of upsets in all federally-issued permits, Marathon Oil Co. v. EPA, 565 F.2d 1253 (9th Cir. 1977), and California law requires application of the federally-mandated provisions unless the state makes specific findings regarding the "water quality" necessity for imposing more stringent requirements. California Water Code Section 13377; Southern California Edison Co. v. State Water Resources Control Board, 116 Cal. App. 3d 751 [16 ELR 20009] (1981). The state has made no such "water quality" necessity findings with respect to the permit issued to Union Oil.

4. Since the exceedances alleged by plaintiff are excusable as upsets, defendant is entitled to a judgment in its favor dismissing this action with prejudice.

5. Judgment is rendered in favor of defendant Union Oil against plaintiff Sierra Club, and defendant is entitled to its costs.

Judgment

It is hereby ordered, adjudged and decreed that judgment shall be entered in favor of defendant Union Oil Company of California and against plaintiff Sierra Club, in accordance with the Findings of Fact and Conclusions of Law entered by the court herein. It is further ordered that defendant shall recover its costs of suit.