Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-93-01335/USCOURTS-caDC-93-01335-0/pdf.json

Parties Involved:
Environmental Protection Agency
Respondent
Wyandotte Municipal Service Commission
Petitioner

Document Text:

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued April 25, 1996 Decided July 23, 1996

No. 93-1325

TEXAS MUNICIPAL POWER AGENCY,

PETITIONER

v.

ENVIRONMENTAL PROTECTION AGENCY,

RESPONDENT

Consolidated with

93-1334, 93-1335, 93-1336, 93-1349

-

On Petitions for Review of Orders of the

Environmental Protection Agency

Lambeth Townsend argued the cause and filed the briefs for petitioner Texas Municipal Power

Agency.

David R. Straus argued the cause for petitioners American Municipal Power Ohio, Inc., et al. With

him on the briefs were Daniel I. Davidson and Scott H. Straus.

William F. Hanrahan argued the cause and filed the briefs for petitioners Nebraska Public Power

District, et al.

Alice L. Mattice and Ronald M. Spritzer, Attorneys, United States Department ofJustice, argued the

causes for respondent. With them on the brief was Lois J. Schiffer, Assistant Attorney General.

Cannon M. Tolbert, pro hac vice, entered an appearance.

Before: SILBERMAN, WILLIAMS and SENTELLE, Circuit Judges.

Opinion for the Court filed PER CURIAM.

PER CURIAM:

I. Introduction

With its 1990 amendments to the Clean Air Act (the "Act"), Congress established a program

for addressing acid rain, for the first time seeking to cut air pollution bymeans ofmarketable permits.

See 42 U.S.C. §§ 7651-7651o; see generally Indianapolis Power & Light Co. v. U.S. EPA, 58 F.3d

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643 (D.C. Cir. 1995). The basic idea of such a regulatory device is that if polluters for which

cutbacks are relatively costly can buy pollution entitlements from ones for which cutbacks are

relatively cheap, the nation can achieve a much greater overall cutback for a given expenditure of

resources (or achieve a given cutback for a lower expenditure).

We deal here with a necessary aspect of any such programthe allocation of initial

entitlements. Congress intended that for "Phase II" of the general emissions trading scheme (Phase

I targeted specific heavy polluters), entitlements would add up to emissions of 8.95 million tons of

sulphur dioxide (SO2) per year by affected utilities, 10 million tons below 1980 levels. See 42 U.S.C.

§ 7651b(a)(1) (basic allowances of 8.9 million tons); id. at § 7651d(a)(3) (providing for an additional

50,000 tons). It charged the Environmental Protection Agency ("EPA") with allocating these

entitlements among 2,200 electricity plants throughout the country. In most cases, the EPA was to

calculate the allowance by multiplying the unit's "baseline"i.e., the average of the annual amount

offossilfuelit consumed during 1985, 1986, and 1987by the lesser of(1) a plant's actual emissions

rate (usually for 1985), or (2) the regulatory ceiling on that rate. 41 U.S.C. §§ 7651a, 7651d. To

accomplish this, the EPA wasto construct what it calls a "NationalAllowance Database" or "NADB"

of fuel consumption ("baseline") data and emissions data using existing government data sources.

The "baseline" data was to be drawn from reports by plants on a standard Department of Energy

form, known as Energy Information Administration ("EIA") Form 767. 42 U.S.C. § 7651a(4)(A).

If a unit did not file an EIA form during the relevant period, the baseline fuel consumption was to be

the level specified for the unit in the 1985 National Acid Precipitation Assessment Program

("NAPAP") Emissions Inventory, Version 2, National Utility Reference File ("NURF") or in a

corrected database established by EPA. Id.; Brief of Respondent at 8-9 & n.5. Actual 1985

emissions ratesdistinct from "baseline" or fuel consumption rateswere to be the emissions rates

reported in NURF. 42 U.S.C. § 7651a(16). Once the allowances determined by the formula were

aggregated for the 2,200 units in question, they could then be reduced across the board so that they

would add up to only the permissible 8.95 million tons per year.

The petitioners here are utilities asserting that they were shortchanged in the allocation

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processin the following ways. (1) American Municipal Power-Ohio, Inc. ("AMP-Ohio") asserts that

EPA was unjustified in using the average sulphur content of fuel burned by Ohio utilities in 1985 in

calculating the actual 1985 SO2 emission rates for AMP-Ohio's Gorsuch plant. EPA says that in

doing so it was bending over backwards on AMP-Ohio's behalf, as the latter had failed to provide

proper data for the Gorsuch plant and could have been denied any allocation for the plant. (2)

Indiana Municipal Power Association ("IMPA") and Wyandotte Municipal Service Commission

("Wyandotte") own units that started operation between October 1, 1990 and December 31, 1992.

Because they failed to submit data about these plantsin accordance with statutory and administrative

deadlines (as read by the EPA), the EPA denied the owners any entitlements for these plants. (3)

Texas Municipal Power Authority ("TMPA") contends that the EPA misinterpreted § 402(4)(A) of

the Act, 42 U.S.C. § 7651a(4)(A), which tells the EPA how to treat plant outages, and as a result

wrongly denied TMPA an adjustment in its fuel consumption in the measuring period for a 33-day

shutdowncaused bymechanicaldifficulties. (4) Nebraska Public Power District, Southwestern Public

Service Company and Arco Coal Company (collectively, "NPPD") say that the EPA misconstrued

§ 402(18) of the Act, 42 U.S.C. § 7651a(18), which governs the conversion of disparate emissions

limitationsratesinto annualized limits on emissions of pounds of SO2 per millionBritish thermal units

("mmBtu") (a measure of the heat content of the fossil fuel consumed). According to NPPD, the

statute calls for no conversion at all when the pre-existing limitation is expressed in pounds per

million Btu, without an express statement of the time period over which it is to be measured.

Before we reach the merits, we must consider two preliminary issues. First, we raised on our

own the question whether 42 U.S.C. § 7607(b)(1), which allocates petitions for review of certain

"locally or regionally applicable" actions of the EPA to "the appropriate circuit" (conceived in

geographic terms), is jurisdictional or merely a matter of venue. Second, the EPA asserts that §

402(4)(C) ofthe Act, 42 U.S.C. § 7651a(4)(C), barring judicialreview of certain "corrections" in the

process bywhich the EPAtransformsmaterialfromvarious databasesinto final allocations, precludes

our consideration of the first three claims.

We conclude that § 7601(b)(1) is a matter of venue, not jurisdiction; since EPA raised no

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1 Section 402(4)(A) provides that

[t]he Administrator, in the Administrator's sole discretion, may exclude [from the

baseline calculation] periods during which a unit is shutdown for a continuous

period of four calendar months or longer, and make appropriate adjustments under

this paragraph. Upon petition of the owner or operator of any unit, the

Administrator may make appropriate baseline adjustments for accidents that

objection, the provision is no bar to our review. We also find that § 402(4)(C) does not preclude

review of any of the petitioners' claims. Finally, on the merits, we reject each of those claims.

II. Reviewability

EPA contendsthat we cannot review the so-called database challenges of AMP-Ohio, IMPA

and Wyandotte, and TMPA under § 402(4)(C)'s preclusion of judicial review clause. Section

402(4)(C) provides:

The Administrator shall, upon application or on his own motion, by December 31,

1991, supplement data needed in support of this subchapter and correct any factual

errors in data from which affected ... units' baselines or actual 1985 emission rates

have been calculated. Corrected data shall be used for purposes of issuing allowances

under the subchapter. Such corrections shall not be subject to judicial review, nor

shall the failure ofthe Administrator to correct an alleged factual error in such reports

be subject to judicial review.

42 U.S.C. § 7651a(4)(C) (1994). It is argued that this language, read in light of the statutory scheme

and objectives and the legislative history, overcomes the presumption in favor of reviewability of

agency action and precludes any challenge to a database allocation. See Block v. Community

Nutrition Inst., 467 U.S. 340, 345, 349 (1984).

Petitioners claim, however, that § 402(4)(C)'sscope is narrow. Its language precludes review

only of changes to the NURF-NAPAP data, not the NADB. Since the language refers to "data from

which" baselines or actualemissionrates are calculatedtheNURF-NAPAPand allows corrections

"in such reports," it does not extend to the NADB or the emissions allowances. And it only bars

review of "corrections" of data, not "additions" to data. Here, there were no data in the historical

data sets for EPA to correct. In a similar vein, TMPA argues that § 402(4)(C) bars review only of

the original determination of the baseline emission rates, not of subsequent "adjustments" to

established baselines pursuant to § 402(4)(A), under which it requested a change; the two actions

are distinct, as are the statutory sections.1 And if subsection (C)'s preclusion of review already

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caused prolonged outages.

42 U.S.C. § 7651a(4)(A) (1994). 

applied, subsection (A)'s language giving the Administrator "sole discretion" to exclude shutdown

periods from the baseline calculation would be superfluous.

EPA argues, instead, that § 402(4)(C) includes changes to both the previously-filed NURFNAPAP data and the NADB. The section refers to "[c]orrected data ... used for purposes of issuing

allowances," which must mean, according to EPA, the NADB. Moreover, the "data" referred to

logically must include the NADB; since the NADB is composed of and calculated from the NURFNAPAP data, a change in the latter necessarily requires a change in the former. The provision's

subsequent reference to "such reports" therefore includes the NADB. EPA also claims that an

"addition" to an incomplete data set is a "correction" of that data set. Or, at minimum, it is a

"supplement" to that data, and § 402(4)(C) expressly includes any "supplement [to] data needed in

support of this subchapter." It would be anomalous for Congress to allow review of such changes

while precluding review of any change to existing data. As to TMPA's § 402(4)(A) argument, EPA

contends that "adjustments" under subsection (A) are simply another type of "correction" that is

unreviewable under § 402(4)(C). The data adjustments that subsection (A) addresses are part of the

NADBsubsection (A) refersto the baseline specified in "a corrected data base as established by the

Administrator" under subsection (C). And subsection (C) refers broadly to all supplements and

correctionsto the NADBand expresslyincludes correctionsto data used to calculate baselines, which

would seem to include adjustments to that data.

Petitioners also contend that their claims are presumptively reviewable, even under §

402(4)(C)'s preclusion language, because they raise statutory interpretation issues. See Bowen v.

Michigan Academy of Family Physicians, 476 U.S. 667, 670-72 (1986). And EPA has failed to

point to any language that would overcome this presumption. The statutory language precludes

review only of "factual errors," which are then narrowlydefined bythe reference to the historical data

sets, so legal and procedural challenges remain reviewable. Lindahl v. Office of Personnel Mgmt.,

470 U.S. 768, 779-80 (1985). Thus, AMP-Ohio characterizes its challenge as whether EPA's

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decision to use a statewide average for fuelsulfur content is a permissible construction ofthe statute.

And TMPAemphasizesthat its challenge to EPA'sinterpretation of "accidentsthat caused prolonged

outages" does not turn on a factual dispute (although the parties argue over whether this was an

"explosion") or on EPA's application of its rule, but rather on whether EPA's definitions of

"prolonged" and "accident" are reasonable statutory interpretations.

EPA objects that this reading eviscerates § 402(4)(C). Since almost any "alleged factual

error" can, to some extent, be characterized as an issue of statutory interpretation, allowing review

on that basis would undermine significantly § 402(4)(C)'s preclusion. In the case of AMP-Ohio and

IMPA and Wyandotte, the gravamen of their claims is that they submitted data to EPA which EPA

improperly failed to include in the NADB: AMP-Ohio challenges the use of a statewide average fuel

sulfur content instead of AMP-Ohio's submitted figure, and IMPA and Wyandotte contest the

straightforward exclusion of all data pertaining to their units because not timely submitted. TMPA

similarly seeks a change in its baseline emission rate. EPA asserts that these are precisely the type

of factual claimsturning on the application of statutory and regulatory criteriathat § 402(4)(C)

is intended to preclude, regardless of the source of the error.

Finally, both EPA and petitioners argue that the legislative history and congressional purpose

favor their interpretation. Thus, petitioners assert that their more restricted view of § 402(4)(C)

accords with Congress' purpose. The legislative history is claimed to show that the provision was

intended to allow EPA to correct onlyministerial, book-keeping mistakesin the previously-filed data.

See 136 Cong. Rec. S2,988 (daily ed. March 22, 1990) (statement by sponsor Senator Levin). And

since Congress precluded review of these corrections based on their straightforward nature, there is

no indication that allowing review of other data claims will undermine the statutory objectives. EPA,

by contrast, argues that its reading of § 402(4)(C) is proper because the statutory scheme and

legislative history show that Congressintended to preclude judicialreview of all changesto the data.

Congress imposed short statutory deadlinesrequiring EPA rapidly to compile enormous amounts

of data and allocate allowancesto 2,200 utilitiesin order to allow utilitiesto know their allowances

and to be able to trade well in advance of the allowance market's effective date. Such advance

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2 AMP-Ohio claims, erroneously, that courts have already determined that review is available

for allowance determinations under the Clean Air Act. But the cases it cites are inapposite. 

Indianapolis Power & Light Co. v. EPA, 58 F.3d 643, 646 (D.C. Cir. 1994), determined that the

Act was silent on adjustments to emissions data for "extension allowances"under a Phase I

provision not at issue hereand that EPA's interpretation was permissible. The opinion did not

address § 402(4)(C) preclusion and gave no indication the issue was even raised. Similarly,

Madison Gas & Elec. Co. v. EPA, 4 F.3d 521, 530-31 (7th Cir. 1993), did not address this issue,

but instead focused on § 307(b)(1)'s choice of circuit provision (discussed infra). 

3 We say "appears to provide" because it is not even clear to us that this distinction is coherent. 

Section 402(4)(C) does not provide any substantive standards, so it is improbable that a party will

petition for review "under" § 402(4). EPA does not indicate how we are to determine which

challenges are "§ 402(4) challenges," unless they are simply challenges that by default fail to

mention another section of the statute. But in this regard, AMP-Ohio contested the definition of

"actual emission rate" in § 405(c)(2), and IMPA and Wyandotte challenged EPA's interpretation

of the several statutory and regulatory provisions governing the timely submission of data,

including the July 1991 Notice and 42 U.S.C. § 7651d(b)(1) (1994) (defining units "eligible" for

knowledge and minimal changes were thought necessary to the market's proper functioning. Judicial

review, including review of outage adjustments under § 402(4)(A), would undermine this goal by

introducing uncertainty and delay into the allocation process. H.R. REP. NO. 490, 101st Cong., 2d

Sess. 371 (1990).

We agree with EPA that "additions" are "corrections" within the meaning of § 402(4)(C) and

that the section covers changesin the NADB as well as changesin the NURF-NAPAP data. But this

does not resolve the issue of what type of claim is reviewable, i.e., what is a "correction[ to] ... an

alleged factual error."

2

It became clear at oral argument that EPA is defining such a correction as

the subject of any challenge made under § 402(4)what it calls a "database challenge." The

distinction EPA is drawing therefore is not between "factual" corrections and "legal" issues, but

between the various sections of the statute. EPA in effect is asserting that any challenge under §

402(4), regardless of its primary thrust, necessarily implicates a factual correction, while any other

challenge does not. Accordingly, EPA claims that TMPA's petition challenging the definition of

"accidents causing prolonged outages" under § 402(4)(A) cannot be reviewed, while it concedes

NPPD's claimthat EPA erred in determining its allowable emission rate when it annualized the permit

limit under § 402(18) can be.

EPA's construction appears to provide a clear demarcation between reviewable and

unreviewable claims.3 But it may preclude review of claims that, although they will inevitably affect

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allowances). If the dividing line instead is whether a petition seeks a change in the NADB, we

have come full circle. 

NADB figures and allowance allocations, focus primarilyon an interpretive issue. On the other hand,

confining the scope of preclusion to mere correction ofministerial errors, as petitionerssuggest, does

not accord with the provision's languagee.g., its references to "supplement" as well as

"correct"or Congress' apparent purpose in enacting it; and such a narrow interpretation certainly

is not compelled by legislative history. We are uncomfortable with both positions.

While the statutory language does make a distinction between challengesto factual errors and

legal/statutory interpretation issues, that distinctionat least as shown in these casesis not easily

applied, and, in any event, EPA's interpretation or application of that concept does not accord with

traditional understandings of the distinction. Many factual corrections to the NADB would seem to

depend on a process and a choice of a particular methodology, allowing it plausibly to be

characterized as a legal issuean interpretation of what processthe statute requires or permits. For

example, AMP-Ohio challengesthe inclusion of a particular data element in the NADB, representing

the actual amount ofsulfur dioxide its unit emitted, yet EPA's decision to include that number rather

than AMP-Ohio'sfigure likely involves an interpretation of what the statutory requirement of "actual

emission rate" entails. Similarly, TMPA seeks a correction (or adjustment) of the data representing

its unit's emissionsfor the baseline years to reflect an outage, but the requested change seemsto turn

on the definition of "accidents causing prolonged outages." As these examples show, attempting to

distinguish claims that are factual versus legal appears difficult, without any obvious standards or

principles.

EPA implicitly recognizesthis difficulty in trying to draw the reviewability line in accordance

with sections of the statute. It emphasizes, quite correctly, § 402(4)(C)'s importance in minimizing

challenges to the database and the clear congressional intent to preclude at least some challenges.

But the distinction EPA suggests is simply not supported by the statutory reference to "factual

errors." Its practical effect is equally untenable: it would preclude review of claims, such as TMPA's,

that appear primarily legal, but allow those brought under other statutory sections, such as NPPD's

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4 Our resolution of this issue makes it unnecessary for us to consider TMPA's alternative claim

that § 402(4)(C)'s preclusion does not extend to adjustments made pursuant to § 402(4)(A). 

petition challenging the annualization of its permit emissions limit, even if the goal of the suit were

to change the NADB data in order to obtain more allowances. Congress clearly could preclude any

challenge to the NADB, but we cannot fairly conclude that it has done so on the terms EPA suggests.

Thus, while we are highly sympathetic to EPA's claim, we are presented with no principled way to

implement § 402(4)(C)'s preclusion language in these cases. We are therefore obliged to reach the

merits of these petitions.4

We reach a similar conclusion with regard to EPA's contention that under § 402(4)(C)

petitioners' procedural claimsrelating to changes in the database are also unreviewable. EPA argues

that this follows logically from the preclusion of review of corrections; allowing review of the lack

of a response to a comment on a correction would provide backdoor review of EPA's decision,

undermining the statutoryscheme in precisely the same manner by causing delay and disruption. This

is said to accord with congressional intent to limit procedural review. See § 307(d)(8). Petitioners

note, however, thatstatutoryprovisions precluding judicialreview offactualdeterminations generally

do not extend to procedural or legal questions unless expressly stated. Lindahl, 470 U.S. at 778-81.

That EPA has discretion in deciding whether to correct factual errors does not, therefore, bar review

of EPA's compliance with procedural requirements. And compliance would not, as EPA implicitly

suggests, be futile; having to articulate an explanation may lead the agency to reach a different result,

even if there is no review of the substance of that result. We think petitioners likely correct, and

having determined that EPA's premisethat § 402(4)(C) bars any database challengeis faulty, we

can hardly apply § 402(4)(C)'s preclusion to procedural claims.

We were also troubledalthough the issue was not raised by the partiesby the potential

application of § 307(b)(1) to these petitions. We asked the parties to address its application at oral

argument. Both parties agree that the case is properly before us, but disagree on the effect of §

307(b)(1). That section provides that

[a] petition for review of ... any other nationally applicable regulations promulgated,

or final action taken, by the Administrator under this chapter may be filed only in the

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5

It is worth noting that this argument is in considerable tension with EPA's assertion that all

challenges under § 402(4) necessarily involve corrections of "factual errors" rather than legal

challenges. It seems likely that a nationally applicable action or one having nationwide scope and

effect, that therefore had to be challenged in D.C., would be a "legal" challenge reviewable under

§ 402(4)(C)rather than a factual claim not subject to review, as EPA claims here. Conversely,

database allocation challenges barred from review under § 402(4)(C) as "factual" seem likely to

be "locally applicable" under § 307(b)(1). 

United States Court of Appeals for the District of Columbia. A petition for review

of ... any other final action of the Administrator under this chapter ... which is locally

or regionally applicable may be filed only in the United States Court of Appeals for

the appropriate circuit.

42 U.S.C. § 7607(b)(1) (1994). EPA contends that § 307(b)(1) determines subject matter

jurisdictionnot venueand therefore we should consider it sua sponte. Nevertheless, we have

jurisdiction over these petitions, it is argued, since the NADB and the allocation of emissions

allowances are nationally applicable, or at minimum have nationwide scope and effect. Since there

is a national cap on the number of allowances, a change for one unit or for a category of units, even

though it may appear local or regional in character, affects the overall allocation.5 And treating the

NADB as a nationally applicable rule does not undermine § 307(b)(1)'s "locally applicable" clause,

which is relevant to other EPA actions, such as state implementation plans.

The national scope of the NADB, EPA asserts, is similar to that of the regulation at issue in

NRDC v. Thomas, 838 F.2d 1224, 1249 (D.C. Cir. 1988). There, we determined that a challenge

brought by industry petitioners to the EPA's refusal to exempt previously compliant sources from

demonstrating compliance with new source requirements was to a nationally applicable action that

could only be brought in the D.C. Circuit. We noted that "the clearly nationwide scope of the

regulation is controlling.... If the jurisdictional provision turns on the de facto scope of the regulation,

choice of the correct forum might raise complex factual and line-drawing problems." Id. In other

words, the nationwide scope of the database allocation rule should control, rather than the local

incidence of any one allowance allocation.

However, the case most directly on point, Madison Gas & Electric Co. v. EPA, 4 F.3d 529,

530 (7th Cir. 1993), reached the opposite conclusion. In Madison Gas, the petitioner challenged its

allocation of emission allowances in the Seventh Circuit, claiming its allowances were based on an

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6 We think it likely that the analytic differences between Madison Gas and Thomas can be

explained by the subsequent proviso in § 307(b)(1):

Notwithstanding the preceding sentence [on locally applicable actions] a petition

for review of any action referred to in such sentence may be filed only in [the D.C.

Circuit] if such action is based on a determination of nationwide scope or effect

and if in taking such action the Administrator finds and publishes that such action

is based on such a determination. 

This caveat allows an otherwise local action to be treated as national if it has nationwide scope

and effectprecisely what was at stake in both cases. We do not know why neither case

discussed this proviso. In any event, the proviso would raise additional issuesit seems to

require both a court determination of scope and effect, and a similar published determination by

the Administrator, the mechanics of which are not obviousthat we are not prepared to address. 

incorrect determination of its generating capacity. EPA moved for dismissal under § 307(b)(1),

claiming this was a challenge of national application that must be brought in D.C. The court noted

that the challenge was neither to "a national feature of the acid-rain program" nor to "a state

implementation plan or some other regulation avowedly local or regional," but rather was an

"intermediate case": a challenge to an element of a national program, based on an entirely local

factor. This did not require petitioner to file in the D.C. Circuit, the court determined, because the

only potentially national effectthe concern with piercing the national ceiling of allowanceswas

too speculative.

EPA does not ask us to disagree with Madison Gas, but would have us confine its holding

to the facts of the case. Petitioners agree, asserting that if § 307(b)(1) is a jurisdictional provision,

jurisdiction in the D.C. Circuit is appropriate since their claims are not based on entirely localfactors.

Both parties, then, believe that Thomas is distinguishable from Madison Gas. (Madison Gas

characterized Thomas as dealing with a "national feature" of the acid rain program.)6 But we think

this distinction between "entirely local" and "local but having national effect," like the one between

fact and law under § 402(4)(C), rather elusive. The petitions heree.g., the dispute over the actual

emissions at one of AMP-Ohio's unitsappear no more "national" than the one at issue in Madison

Gas.

We do not have to resolve this issue, however, since we agree with petitioners' alternative

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7

In Thomas, we appeared to assume that § 307(b)(1) was jurisdictional. Our reference to the

provision as jurisdictional was dictum, however, because our holding rested on the determination

that the regulation in question had national application. 838 F.2d at 1249. 

contention that § 307(b)(1) is a venue provision, the application of which can be waived.7 Section

307(b)(1) can be read as prescribing the choice among circuits and not the power of a particular

federal circuit court to hear a claim. This reading is supported by the provision's reference to where

a petitioner may "file," and by its unequivocal characterization in the legislative history as a venue

provision. See H.R.REP. NO. 294, 95th Cong., 1st Sess. 323-24 (1977). Since parties may normally

consent to be sued in a court that would otherwise be an improper venue, EPA's failure to object

waivesthe issue. See FED. R. CIV. P. 12(h)(1); C.A.WRIGHT, FEDERALCOURTS 257 (1994) (citing

Neirbo Co. v. Bethlehem Shipbuilding Corp., 308 U.S. 165 (1939)).

EPA objects to characterizing this as a venue provision. It notes that § 307(b) is entitled

"Judicialreview," that the language is mandatoryrather than providing a "choice" of circuits, and that

the provision also includes a clearly jurisdictional 60-day limit for filing petitions for review. While

there is some "jurisdictional" language, as EPA asserts, that is not determinative; we think it more

significant that federal court power to entertain petitions is clear, that the provision refers to where

a petitioner must file, and that the apparent congressional purpose wasto place nationally significant

decisions in the D.C. Circuit. Given the less than clear language, the structure of the

sectiondividing cases among the circuitsand the legislative history indicate that § 307(b)(1) is

framed more as a venue provision. Therefore, EPA's failure to object waives § 307(b)(1)'s venue

requirements, and the petitions are appropriately before us.

III. Substantive Claims

Turning to the merits, we reject all substantive claims of these petitioners. Specifically, we

hold that it was within EPA's authority to rely on an emission rate calculated from a state-wide

average in determining the allowances to be received by a utility unit whose emission rate was not

included in the relied-upon database, to deny Wyandotte's and IMPA's efforts to request allowances

after the published deadline for such requests, and to define "prolonged," as used in 42 U.S.C. §

7651a(4)(a), asmeaning at least three monthsin duration. We also reject NPPD's argument that EPA

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improperly annualized its relevant allowable emission rate. Finally, we deny all procedural claims

raised by these petitioners because they have not first presented their claims before the agency, 42

U.S.C. § 7607(d)(7)(B), because they have not demonstrated an error on the part of the EPA, or

because they have not demonstrated sufficient prejudice from the alleged procedural deficiencies to

justify reversal. 42 U.S.C. § 7607(d)(8).

A. AMP-Ohio

1. Background Specific to AMP-Ohio's Claims

Section 405(c)(2) of the 1990 Amendments to the Clean Air Act directs the EPA to grant

certain fossil-fueled utility units a number of emission allowances equal to "the product of the unit's

baseline multiplied by the lesser ofits actual 1985 emissionsrate or its allowable 1985 emissionsrate,

divided by 2,000." 42 U.S.C. § 7651d(c)(2). Section 402(16) of these amendments defines the term

"actual 1985 emission rate" for an electric utility unit to mean "the annualsulfur dioxide ... emission

rate in pounds per million Btu as reported in the NAPAP Emissions Inventory, Version 2, National

Utility Reference File." 42 U.S.C. § 7651a(16). No statutory provision, however, suggests how the

EPA should define an existing unit's actual emission rate should the unit not appear in the NURFNAPAP database named in § 402(16).

The EPA addressed this gap in the statutory scheme through a notice published along with

the second version of the National Allowance Data Base ("NADB"), the national database that

catalogs the number of allowances granted to a particular unit. See Acid Rain Provisions, 56 Fed.

Reg. 33,278 (July 19, 1991). This "July 1991 Notice" allowed a utility to submit a claim for

allowancesfor a unit that was not listed in the NURF-NAPAP database, but it required that the utility

also submit certain information, including the unit's "actual emission rate" and some supporting data,

including the sulfur content and ash retention of the fuel burned at the unit, that could be used to

verify the submitted rate. See id. at 33,283-85.

In response to this July 1991 Notice, AMP-Ohio submitted to the EPA a request for

allowancesfor one ofitsfacilitiestheRichardGorsuchgenerating stationaccompanied byvarious

information about that unit. This information included an "actual emission rate" for the facility, but

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did not include the other data required by the July Notice. Though AMP-Ohio later supplemented

itssubmission with additional information, it again omitted the criticalsupporting data. Nonetheless,

EPA included the Gorsuch facility in its third proposed version of the NADB. See Acid Rain

Allowance Allocations and Reserves, 57 Fed. Reg. 29,940, 30,000 (July 7, 1992). In this version,

the EPA granted some allowances to the Gorsuch facility, but far fewer than AMP-Ohio had

expected.

AMP-Ohio protested thisresult during the appropriate comment period, and alleged a number

of errorsthat the EPA made in calculating its allowances. The EPA corrected several computational

and other errors. AMP-Ohio, however, still did not submit the supporting data that was necessary

to confirm the emission rate it had asserted in its application, and the EPA did not specifically

encourage AMP-Ohio to submit this information.

In its final version of the NADB, the EPA granted the Gorsuch facility a total of almost

20,000 allowances,see Acid Rain Allowance Allocations and Reserves, 58 Fed. Reg. 15,634, 15,684

(Mar. 23, 1993), which wasroughly half of the number of allowances AMP-Ohio expected from the

data it had submitted. EPA subsequently informed AMP-Ohio that it had received fewer allowances

because the EPA had based the allowances, not on the emission rate submitted by AMP-Ohio, but

on an emission rate calculated using the average sulfur content of the fuel burned by utilities in Ohio

in 1985. The EPA stated that it used this calculated rate because it did not have the supporting data

necessary to verify the accuracy of AMP-Ohio's claimed emission rate. The EPA has since explained

that this rate was calculated according to a technique used to compute emission rates for other

databases, including the NURF-NAPAP database that § 402(16)specified wasto be used for defining

a unit's actual emission rate. See 42 U.S.C. § 7651a(16).

AMP-Ohio challenges this result on both substantive and procedural grounds.

2. Substantive Claims

Substantively, AMP-Ohio protests the EPA's decision to use an emission rate that the EPA

calculated in part from the statewide average of sulfur content in utility fuel instead of the emission

rate that AMP-Ohio submitted (albeit without the necessary supporting data). AMP-Ohio contends

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that this substitution of a calculated emission rate for the submitted rate was an impermissible

construction of the applicable statutory sections, or, alternatively, was unlawfully arbitrary and

capricious. See 5 U.S.C. § 706.

a. Did the EPA'sinterpretation of the term "actual emission rate" run contrary to the

statute or to reason under Chevron?

Because the EPA is the agency that administers the relevant elements of the Clean Air Act,

we review itsinterpretation of § 402(16) under the familiartwo-step analysis ofChevron, U.S.A., Inc.

v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-44 (1984). Under Chevron, we first

must determine " "whether Congress has directly spoken to the precise question at issue.' " Nuclear

Information Resource Serv. v. NRC, 969 F.2d 1169, 1173 (D.C. Cir. 1992) (in banc) (quoting

Chevron, 467 U.S. at 842.) If Congress has unambiguously expressed its intent in the statute, our

inquiry ends. See id. If the statute is instead silent or ambiguous, we must then " "defer to the

agency's interpretation of the statute if it is reasonable and consistent with the statute's purpose.' "

Id. (quoting Chemical Mfrs. Ass'n v. EPA, 919 F.2d 158, 162-63 (D.C. Cir. 1990)).

In this case, we have little difficulty concluding that the statute does not address the "precise

question" at issue. The statute makes no mention of how the EPA should treat a utility unit whose

emission rates were not included in the NURF-NAPAP database. Although courts have, on rare

occasion, managed to divine some meaning fromsilence,see, e.g., Chisom v. Roemer, 501 U.S. 380,

396 & n.23 (1991) (rejecting an interpretation of a statute because "if Congress had such an

[unorthodox] intent, congress would have made it explicit in the statute"), a silent statute cannot

preclude its reasonable interpretation by the agency that administers it. See Nuclear Information

Resource Serv., 969 F.2d at 1173 (quoting Chevron, 467 U.S. at 843). In view of its silence on the

point at issue, we must hold the statute ambiguous.

Having held the statute ambiguous, we must examine whether the agency'sinterpretation was

reasonable. In its July 1991 Notice, the EPA announced that it understood the statute to permit the

EPA to allocate allowances to a utility unit missing from the NURF-NAPAP database specified in §

402(16). In this Notice, the EPA also declared that it would not necessarily allocate allowances to

these units unless a utility submitted a "missing" unit's 1985 emission rate and certain information so

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that the EPA might verify this rate. See 56 Fed. Reg. at 33,283-85. The Notice, however, did not

describe the EPA's proposed methodologyfor determining the emission rate in case all ofthe required

information was not submitted.

That omission, however, does not make the EPA's subsequent conduct irrational. In the

absence of a rule or stated policy on point, the EPA must possess a reasonable amount of discretion

to implement its own regulations. See, e.g., NRDC, Inc. v. EPA, 22 F.3d 1125, 1148 (D.C. Cir.

1994); cf., Pension Benefit Guaranty Corp. v. LTV Corp., 496 U.S. 633, 653-56 (1990) (holding

that agency must have discretion to adopt procedures to execute tasks left to it). In this case, it

would have made little sense for the EPA to allow AMP-Ohio, which failed to submit the supporting

data, to benefit fromitssin of omission and simply receive all the allowancesthat AMP-Ohio claimed

the Gorsuch units should receive. On the other hand, it may have seemed unduly harsh for the EPA

to deny all allowancesto the Gorsuch facility, given that the statutoryscheme probablyintended units

like Gorsuch to receive some fair number of allowances. Instead, navigating between these extremes,

the EPA calculated an emission rate for the Gorsuch facility that it could confirm had at least some

basis in a verifiable fact: the statewide average of the sulfur content of fuel burned by Ohio utilities.

This approach was not unprecedentedthe EPA had previously relied on such calculated rates in

compiling other databases, including the NURF-NAPAP database that § 402(16) explicitly indicates

should be used to determine the "actual emission rate" of a facility included in that database. And

though the EPA did not explain its precise method for calculating a rate based on a statewide average

that was used in this case until after the close of general proceedings before the agency, the failure

of an agency to identify every detail of a process before it is used does not automatically require

judicial interference in matters that must be thought to lie within the agency's expertise. See

American Meat Institute v. EPA, 526 F.2d 442, 457 & n.28 (7th Cir. 1975). In light of these

considerations, we conclude that the EPA's decision to use the calculated rate for determining the

allowances allotted to the Gorsuch unit was reasonable and consistent with the statute.

b. Did the EPA otherwise act in an arbitrary or capricious manner?

Similarly, applying the Administrative Procedures Act, we cannot find that the EPA acted

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arbitrarily in substituting an emission rate based on statewide averages for the emission rate

submitted, without the necessary supporting data, by AMP-Ohio. The EPA may, within reasonable

bounds, specify what data is necessary for it to determine how many allowances a facility should

receive. See, e.g., Alabama Power Co. v. Costle, 636 F.2d 323, 351-52 (D.C. Cir. 1979) (permitting

the EPA to specify the data necessary for a PSD application under the Clean Air Act). The EPA may

then refuse to act if the data submitted is of uncertain authenticity. See Kennecott v. EPA, 780 F.2d

445, 458 (4thCir. 1985), cert. denied, Secondary Lead Smelters Ass'n, Inc. v. Thomas, 479 U.S. 814

(1986).

In this case, the EPA published a general notice asto the information it needed to allocate any

allowances to a utility unit missing from the then-current version of the NADB, and AMP-Ohio's

submission did not complywith these requirements. That AMP-Ohio may not have understood what

was required does not excuse its omissions. It is the duty of a party seeking agency action to press

its claim, see, e.g., Northside Sanitary Landfill, Inc. v. Thomas, 849 F.2d 1516, 1519-20 (D.C. Cir.

1988), cert. denied, 489 U.S. 1078 (1989), the agency need not repeatedly warn the party that its

submission did not satisfy publicly announced guidelines. Nor, as previously discussed, did the EPA

improperly substitute an emission rate calculated according to its established method for determining

unknown rates in lieu of the unverifiable rate submitted by AMP-Ohio. Because EPA acted within

its discretion in specifying what information a utility had to submit to receive allowances and in

determining how the EPA should handle a submission that did not fulfill these requirements, the EPA

was neither unreasonable nor impermissibly arbitrary in using a rate based on a statewide average in

order to calculate the appropriate emission level of AMP-Ohio's Gorsuch facility.

3. Procedural Claims

In addition to its substantive challenges, AMP-Ohio makes a number of procedural attacks.

The only three that require some discussion are that the EPA failed to respond to significant

comments asrequired by statute, to request additionalsupporting data fromAMP-Ohio soon enough

for AMP-Ohio to provide such information, and to explain how it arrived at the emission rate it used

to calculate Gorsuch's final allowances. None of these concerns merit reversal.

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a. Did EPA err when it did not affirmatively act to correct AMP-Ohio's deficient

submission as to the emission rate? 

The first two of these significant challenges may be considered together. After the third

proposed version of the NADB was published, AMP-Ohio commented that that version did not

appear to use the emission rate it had submitted. EPA, however, neither explained its decision not

to use the submitted rate nor promptly notified AMP-Ohio of the utility's failure to include the

necessary supporting data in its submission. AMP-Ohio argues that the EPA erred when it did not

indicate why it chose not to use the submitted emission rate and when it did not more quickly request

the necessary supporting information.

Neither claim establishes error. Precedent has established that an agency need not respond

to comments if that response would mainly restate "what had already been set forth" in some

published notice. See NRDC, Inc. v. EPA, 859 F.2d 156, 188-89 (D.C. Cir. 1988). As the EPA had

already declared what information was necessary for a submitted emission rate to be considered, see

56 Fed. Reg. at 33,283-85, it did not have to take additionalsteps to inform AMP-Ohio individually

of these requirements. Similarly, the EPA, as noted, does not bear some general duty to seek out

information that an applicant has omitted in a submission, especially when the applicant has some

notice that the data was essential. Thus, the EPA did not err when it did not remind AMP-Ohio that

it should submit all the data required by the July 1991 Notice.

b. Did the EPA err when it did not explain its method of substituting a calculated

emission rate for a submitted rate that was not verifiable?

AMP-Ohio's third set of procedural complaints must also be denied. AMP-Ohio argues that

the EPA did not explain how it determined the emission rate eventually used to calculate the Gorsuch

unit's final allowances. According to the applicable review provision in the Clean Air Act, however,

we have no jurisdiction to hear a claim until it has been "raised with reasonable specificity" before the

EPA, either "during the period for public comment" or in a separate petition for reconsideration. 42

U.S.C. § 7607(d)(7)(B). AMP-Ohio has not demonstrated that it ever brought this specific complaint

to the attention of the agency during an appropriate comment period. Nor did AMP-Ohio ever

demonstrate that it was impracticable for it to do so in a petition for reconsideration. In accordance

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with § 7607(d)(7)(B), then, we must dismissreview ofthis procedural challenge. For similar reasons,

we must also decline review as to whether the EPA's failure to include the statewide average on

which it relied in the record violated 42 U.S.C. § 7607(d)(6)(C).

B. IMPA and Wyandotte

1. Background Specific to IMPA's and Wyandotte's Claims

Section 405(g)(3) of the 1990 Amendmentsto the Clean Air Act permitsthe EPA to allocate

allowances to utility units that commence operation between October 1, 1990, and December 31,

1992 ("1992 units"). 42 U.S.C. § 7651d(g)(3). Because these units did not have an actual or

allowable 1985 emission rate used to calculate allowances for units operating in 1985, however, the

section instructed the EPA to determine the unit's allowances based on the unit's "annual fuel

consumption" and "allowable sulfur dioxide emission rate." Id. Of course, as these units had not

previously existed, the EPA was largely unaware of the proper number of allowances they should

receive.

In a notice published along with the second version of the NADB ("July 1991 Notice"), the

EPA established guidelines by which utilities could seek allowances for any units that were not

included in the EPA's second version of that database. See Acid Rain Provisions, 56 Fed. Reg.

33,278, 33,279 (July 19, 1991). This July 1991 Notice warned all applicants that:

In order to finalize the database in a timely manner, EPA will not accept

requestsfor data correctionsfollowing the comment period [which ended September

3, 1991], except when the utility can demonstrate that the correct data were

unavailable during the comment period. No data will be changed or added after

publication of the final database in December, 1991.... Units eligible for allowances

will not be allocated allowancesif the final database does not include the information

necessary.

Id. at 33,283. The Notice also stated that any unit seeking to add data must submit a data change

request form and necessary supporting documentation. See id. The form itself listed 36 items of

information that a utility had to supply, ranging from the name and location of the plant, general

design specifications of the plant, to the allowable emission rate of the plant. See id. at 33,283-86.

The Notice, however, did not explicitly state that it intended to govern allocation requests for 1992

units, though a number of such units were absent from the second version of the database.

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On May 13, 1992, IMPA first contacted the EPA about four utility unitsthat were to become

"imminently" operational. Though none of the units were in the second version of the NADB, IMPA

had not previously notified the EPA about these units. IMPA explained that it had not submitted

information earlier, despite the July 1991 Notice's statement that the EPA would not make

corrections after the end of that year, because IMPA did not think the July 1991 Notice applied to

1992 units, assome data required by the Notice may not have been available until a unit commenced

operations. IMPA thus had not submitted any data about these units, even though IMPA's own

correspondence made clear that IMPA had known much basic information about the units prior to

the end of 1991.

Another utility that was constructing a new unit slated to become operational in 1992, the

Wyandotte Municipal Services Commission ("Wyandotte"), also notified the EPA later than any

deadline named in the July Notice, in August 1992. Like IMPA, Wyandotte did not show that the

data on its 1992 unit was unavailable in 1991. In fact, Wyandotte's own late submission, like IMPA's,

indicated that much information was known before the close of the July 1991 Notice's comment

period. Wyandotte, however, explained that the utility had not sent information on its new boiler

earlier because it had interpreted the local instructionsfor data correction as not allowing submissions

for units under construction.

In a document published in March 1993, the EPA denied both IMPA's and Wyandotte's

requests for allowances for these 1992 units because they did not comply with the submission

deadlines in the July 1991 Notice. Neither IMPA nor Wyandotte had submitted information clearly

available to each utility on their respective 1992 units prior to September 3, 1991, as, according to

the EPA, the July Notice required, and neither had submitted all necessary data by the end of

December 1991. IMPA and Wyandotte now protest their exclusions.

2. IMPA's Substantive Claim

IMPA contends that the EPA was arbitrary and capricious in denying IMPA's new facility

allowances simply because IMPA did not comply with the deadlines established in the July 1991

Notice. IMPA does not challenge the EPA's authority to define when and how a utility must request

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allowances for its units under the Clean Air Act. Instead, IMPA argues that we should not interpret

the July 1991 Notice to have applied to units, like the ones at issue, that were still under construction

in 1991.

Although we normally extend great deference to an agency's interpretation of its own

regulations, see, e.g., Consarc Corp. v. Office of Foreign Assets Control, 71 F.3d 909, 914 (D.C.

Cir. 1995), IMPA observes that our precedent has refused to extend this deference to an unclear

agency policy that would, if applied, result in a "drastic" penalty to the private party. See General

Elec. Co. v. EPA, 53 F.3d 1324, 1328-29 (D.C. Cir. 1995); Radio Athens, Inc. v. FCC, 401 F.2d

398, 404 (D.C. Cir. 1968). Instead, in these "drastic" cases, we have generally accepted the

threatened petitioner's reasonable interpretation of the agency's policy, see, e.g., Satellite

Broadcasting Co., Inc., v. FCC, 824 F.2d 1, 3-4 (D.C. Cir. 1987); Gates &Fox Co., Inc. v. OSHRC,

790 F.2d 154, 156 (D.C. Cir. 1986), unless the petitioner, through a good-faith review of the

statements issued by the agency, should have been able to determine, "with ascertainable certainty,"

the criteria that the agency expected the petitioner to satisfy. General Elec. Co., 53 F.3d at 1329

(citation and internal quotations omitted). Consequently, IMPA contends that we should accept its

interpretation that the Notice did not apply to its units because a decision to deny all allowances to

its 1992 units would constitute an unfairly severe penalty, because the Notice was not clear, and

because IMPA's interpretation, that the Notice did not apply to units not yet in operation, was

reasonable.

Assuming that the loss of all allowances would be a drastic penalty, and that the scope of the

July 1991 Notice was not clear, we still cannot conclude that IMPA's interpretation of the July 1991

Notice was reasonable in light of the contents and context of that Notice. The text of the Notice

specified that the EPA would complete the final version of the allowance database by December 31,

1991. See, e.g., 56 Fed. Reg. at 33,279. The Notice, however, also implied that it contained the last

directions the EPA would issue prior to the publication of this final database. See id. A party

interpreting the July 1991 Notice at the time of the Notice thus could either conclude that the Notice

applied to 1992 units, or that the EPA had decided to offer no guidance at all as to how these units

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should seek allocations prior to the imminent publication of the finalized database.

The latter reading was not reasonable. No sensible party could have thought that the EPA

would specify 36 types of information necessary for an existing unit to add to or correct the data to

be used for calculating its allowance without saying one word about what a 1992 unit had to submit.

Yet, that is what IMPA claims. Accordingly, we conclude that, given these facts, IMPA was

unreasonable to think the July Notice did not apply to 1992 units.

Having concluded that IMPA could not have reasonably thought that the July 1991 Notice

did not apply to 1992 units, we must deny IMPA's claim. IMPA clearly did not meet the standards

of the July Notice. IMPA did not submit available information on the unitsuch as the plant name

or certain technical or design databy September 3, 1991. Nor did IMPA demonstrate that this or

other data was unavailable as of September 3, 1991, which, under the July 1991 Notice, would have

allowed IMPA to submit the data until December 1991. Nor did IMPA even submit any data to the

EPA byDecember 1991. In short, IMPA did not comply with any aspect or reasonable interpretation

of the July 1991 Notice. As that Notice must have applied to IMPA's 1992 units, we cannot overrule

the agency's decision not to award these units any allowances.

3. Wyandotte's Claims

Having determined that any reasonable interpretation of the July 1991 Notice would apply

to 1992 units, we must also reject Wyandotte's claim for allowances for its 1992 unit. Wyandotte,

like IMPA, did not submit any information until well after the deadlines specified in the July Notice,

even though at least some information on its 1992 units was available well before that date. That

Wyandotte wrongly interpreted local instructions on whether and when a utility should submit

information on 1992 units also does not excuse the tardiness of its allocation request. The July

Notice repeatedlyforbade utilitiesfromsubmitting entirely new claimsfor allowances after 1991. We

thus also conclude that the EPA may deny allowances to Wyandotte's 1992 unit.

C. TMPA

1. Background Specific to TMPA's Claims

Section 402(4)(A) of the Clean Air Act Amendments specifies that the Administrator may

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adjust a unit's emission allowances for "accidents that caused prolonged outages." 42 U.S.C. §

7651a(4)(A). That provision reads, in pertinent part:

For each utility unit that was in commercial operation prior to January 1, 1985, the

baseline shall be the annual average quantity of mmBtu's [heat energy] consumed in

fuel during calendar years 1985, 1986 and 1987.... The Administrator, in the

Administrator'ssole discretion, may exclude periods during which a unit isshutdown

for continuous period of four calendar months or longer, and make appropriate

adjustments under this paragraph. Upon petition of ... any unit, the Administrator

may make appropriate baseline adjustments for accidents that caused prolonged

outages.

Id. (emphasis added).

As a response to EPA's general request for applications for outage adjustments in the July

1991 Notice, see 56 Fed. Reg. 33,282 (July 19, 1991), but prior to any establishment of standards

guiding EPA review of these applications, TMPA submitted an application for an adjustment to its

baseline for a 33-day outage during the "calendar years 1985, 1986 [or] 1987" that was caused by

the failure of the plant's cooling bars. Having received several applications for similar adjustments,

EPA proposed to dispense with these applications by distributing them among several categories

based on the statutory requirements. One proposed category would have allowed adjustments for

applications that demonstrated that an outage was "prolonged"tentatively defined as being "four

months or longer"and caused by an "accident"that is, "the occurrence of a natural phenomenon

... or an incident unrelated to the operation of the unit that is unpreventable, unforeseeable, and not

caused by worker error." Acid Rain Provisions, 57 Fed. Reg. 30,034, 30,036-38 (July 7, 1992).

As TMPA's adjustment application stated that its outage lasted only 33 days in the relevant

period, it did not qualify for this proposed category (or any proposed category that would have

granted it an adjustment). See id. at 30,037 & 30,038 Table 2. Moreover, because the EPA refused

to accept any revised applications lest the EPA be unable to publish a corrected NADB by the

statutory deadline, see id., TMPA could not supplement its application to show that its outage might

qualifyforsuch a category. Instead, TMPA submitted comments about the suggested categories, and

it directed the attention of the EPA to a colloquy between two representatives during the floor

discussion of § 402(4)(A)the Barton-Lent colloquy, see 136 Cong. Rec. H12,876-77 (daily ed.

Oct. 26, 1990)that supported TMPA's position that its outage merited some adjustment.

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In March 1993, the EPA issued a final interpretation of § 7651a(4)(A). This final rule

generally maintained the proposed definition for "accident," but redefined a "prolonged outage" by

reducing the necessary minimum from four to three months. Notice of Availability of the National

Allowance Data Base, 58 Fed. Reg. 15,720, 15,723 (March 23, 1993). EPA explained this reduction

as necessaryinorder to avoid rendering the statutorylanguage governing accidentally-caused outages

mere surplus, as another segment of § 402(4)(A) already provided that a utility that suffered a

four-month outage, for whatever reason, could apply for an adjustment. See 42 U.S.C. §

7651a(4)(A). The EPA also concluded that, as three months was longer than the average outage

according to a NERC study added to the record by the EPA one day prior to the promulgation of the

final rule, three months could reasonably be deemed "prolonged." See id. At that time, the EPA

made a final list of applicants that would not receive adjustments, including TMPA.

TMPA challenges the EPA's decisions and its decision-making on several grounds.

2. TMPA's Substantive Claims

Substantively, TMPA challenges EPA's definitions of "prolonged" and "accident." EPA

ultimately interpreted "prolonged" to mean longer than three months, which is well longer than the

average outage, but shorter than the four months specified in another sentence of § 402(4)(A)

required for an adjustment for outages not caused by accidents. See 58 Fed. Reg. at 15,723. TMPA

argues that the unambiguous meaning of prolonged denies this definition, and that the term clearly

intends to encompass any outage longer than the mean or median outage. TMPA also protests the

narrowness of EPA's definition of accident.

a. Did the EPA reasonably interpret the term "prolonged? "

We reject TMPA's challenge to EPA'sstatutory interpretation ofwhat constitutes prolonged.

Again, we perform the "Chevron two-step" in reviewing EPA's interpretations of the Clean Air Act

and its amendments. See supra Section III.A.2.b.

Having reviewed § 402(4)(A), we conclude that the term"prolonged," as used in thatsection,

is ambiguous. The common meaning of "prolonged" denotes an extended duration. See, e.g.,

Webster's Third International Dictionary 1815 (1961). What qualifies as extended, however, is not

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fixed. At best, the context of the term as used in § 402(4)(A) may suggest that Congress intended

any definition of a "prolonged outage[ ]" to be less than a four-month outage, as a unit that suffered

an outage lasting four months or more may have been able to receive an adjustment whether or not

that outage was caused by an accident. This implication from the statutory context, however, hardly

clarifies the meaning of the term sufficiently for us to reach an "unmistakeable conclusion that

Congress had an intention on the ... question." Ohio v. Dep't of Interior, 880 F.2d 432, 441 (D.C.

Cir. 1989).

No other accepted form of statutory interpretation achieves some clearer understanding of

"prolonged" as used in the provision. In particular, the presence of the Barton-Lent colloquy does

not affect our result. As we have warned in the past, judges must " "exercise extreme caution before

concluding that a statement made in floor debate, or at a hearing, or printed in a committee document

may be taken as statutory gospel,' " in light of the " "endemic interplay, in Congress, of political and

legislative consideration[s]' " likely unrelated to the interpretive tasks of a court. Gersman v. Group

Health Ass'n, Inc., 975 F.2d 886, 892 (D.C. Cir. 1992) (quoting Antolok v. United States, 873 F.2d

369, 377 (D.C. Cir. 1987)), cert. denied, 114 S. Ct. 1642 (1994). This caution is especially

warranted when, as in this case, it appears that a colloquy was a direct result of "a single member ...

attempting to reassure his own constituency or even to create legislative history for citation by

courts." Id. In this case, the colloquy in question does not give reason for us to draw the

"unmistakeable conclusion" that Congress intended "prolonged," as used in § 402(4)(A), to have

some fixed meaning.

Undertaking the second step of the Chevron inquiry, we also conclude that EPA's definition

of a "prolonged" outage to mean an outage that lasts at least three months is reasonable. A baseline

of three months is substantially longer than the average outage, but it is still sufficiently short as not

to effectively write the "prolonged outage" language out of the statute. For instance, at least one

party described in the record, which actually received an adjustment under another provision, could

have sought an adjustment under the "prolonged outage" provision instead. See 58 Fed. Reg. at

15,724 (allowing adjustment for the George Neal plant). EPA thus acted within its authority when

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it denied TMPA's application for a baseline adjustment under § 402(4)(A). See id. (Table 3).

b. Did the EPA reasonably interpret the term "accident?"

As TMPA conceded at oral argument, a determination that EPA's definition of prolonged is

valid moots any claim by TMPA that EPA's interpretation of "accident" is also valid. We thus

conclude that TMPA cannot prevail on either of its substantive challenges to EPA's interpretation of

§ 402(4)(A).

3. Procedural Claims

In addition to itssubstantive challenges, TMPA also raisesseveral procedural arguments. Of

these, only three merit any discussion. TMPA contends that the EPA was arbitrary in universally

denying any re-application for adjustments after the final rule was issued and that the EPA failed to

give TMPA proper notice of the standardsit was expected to meet by acting on TMPA's application

before the finalrule was published. TMPA also claims that the EPA improperly relied on a statistical

study that was added to the record after the comment period had closed. Finally, TMPA argues that

the EPA was arbitrary because it did not sufficiently discuss TMPA's comments directing the EPA's

attention to the Barton-Lent colloquy. We dismiss the first two allegations because they are not

properly before us and the last because the EPA did not err in its lack of specific response to the

Barton-Lent colloquy.

As noted in the discussion of AMP-Ohio's procedural challenges, 42 U.S.C. § 7607(d)

specifies what a petitioner must demonstrate to prevail on a procedural challenge to an EPA action

pursuant to subchapterIV, which includes 42 U.S.C. § 7651a(4)(A). See 42 U.S.C. § 7607(d)(1)(T).

Under thatstatutoryprovision, we mayonlyreview claimsthat have been first raised "with reasonable

specificity" before the agency, 42 U.S.C. § 7607(d)(7)(B), and we mayreverse onlyprocedural errors

that are prejudicial. 42 U.S.C. § 7607(d)(8). Of course, the question of exhaustion precedes any

examination of whether any errors were prejudicial. See Cross-Sound Ferry Servs., Inc. v. ICC, 934

F.2d 327, 343-46 (D.C. Cir. 1991) (Thomas, J., concurring); cf. UDC Chairs Chapter, American

Ass'n of University Professors v. Board of Trustees, 56 F.3d 1469, 1475 (D.C. Cir. 1995) (noting

that exhaustion is a jurisdictional requirement).

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Here, no party suggests that TMPA has properly raised two of these three procedural

challenges before the agency. TMPA could haveand, under the statute, should haveaddressed

its complaintsto the agency about the alleged lack of notice and the agency's delayed inclusion of the

statisticalstudy either in a specific statement to the agency during an appropriate comment period or

in a suggestion for agency reconsideration. 42 U.S.C. § 7607(d)(7)(B). Because TMPA did not do

so, however, we cannot review these procedural claims. In particular, we explicitly decline TMPA's

invitation to read the "futility" exception present in common-law exhaustion doctrine, see UDC

ChairsChapter, American Ass'n of University Professors, 56 F.3d at 1475, into a statutoryprovision

that permits only objectionsraised before the agency to be "raised during judicialreview." 42 U.S.C.

§ 7607(d)(7)(B).

We must also reject TMPA's remaining procedural challenge. The EPA simply did not err

when it did not more extensively address TMPA's comments regarding the Barton-Lent colloquy.

According to our precedent, "[t]he failure to respond to comments is significant only insofar as it

demonstrates that the agency's decision was not based on a consideration of the relevant factors." 

Thompson v. Clark, 741 F.2d 401, 409 (D.C. Cir. 1984) (internal quotations and citations omitted).

In this case, TMPA has not approached showing that the EPA did not consider the relevant factors

in denying TMPA's request for an outage adjustment. Moreover, the EPA's general statement that

it would consider allfloor colloquies asto specific utilitiesto the extent appropriate,see 56 Fed. Reg.

at 33,282, adequately demonstratesthat the agency did not improperly overlook this colloquy, which

would be of dubious value as a guide to agency conduct in any case. On this ground, then, we again

affirm the EPA.

D. NPPD

The acid rain emissionstrading systemclearly depends on some definition of what, in the end,

is to be limited. Congress chose to limit the annual production of tons of SO2. Recall from our

introduction that in referring to the initial allocations to be made by the EPA, Congress commonly

expressed them as the unit's "baseline"i.e., the average amount of fossil fuel it consumed in a

specified periodmultiplied by the lesser of the unit's actual emission rate for 1985 (or another

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calendar year) or of its "allowable 1985 emissions rate," i.e., the legal limit applicable to the unit.

See, e.g., 41 U.S.C. §§ 7651d(b)(3), (b)(4), (c)(2), (c)(3). Because emissions limitations had taken

different forms depending on such factors as when the plant was built, it was necessary, to make sure

that the EPA was not adding up apples and oranges, to state a rule for conversion into a single,

fungible unit. In defining "allowable 1985 emissions rate" Congress in § 402(18) of the Clean Air Act

Amendments of 1990 provided for such conversion:

Where the emissions limitation for a unit is not expressed in pounds of emissions per

million Btu, or the averaging period of that emissions limitation is not expressed on

an annual basis, the Administrator shall calculate the annual equivalent of that

emissions limitation in pounds per million Btu to establish the allowable 1985

emissions rate.

§ 402(18), 42 U.S.C. § 7651a(18) (emphasis added). The unit of lbs SO2/mmBtu derivesfromEPA's

regulations promulgated under the 1970 Amendments to the Clean Air Act, in which Congress

directed EPA to set performance standards limiting emissions from newly built or modified sources

of air pollution. Clean Air Act § 111, 42 U.S.C. § 1857c-6 (1970). EPA responded with a regulation

covering large generators whose construction began between 1971 and 1978, setting the limit at 1.2

lbs SO2/mmBtu for coal-burning generators.

The most obvious cases calling for conversion are limits "not expressed in pounds per million

Btu" at all, e.g., expressed as pounds per ton of coal on a weekly basis. But as the "or" linking that

case in § 402(18) with the next one suggests, the sentence appears also to address limits expressed

as pounds per million Btu but "not expressed on an annual basis."

Why so? The answer is that, because of variability in pollution output of a plant over a period

of time, a limit must, to be complete, include (implicitly or explicitly) some kind of averaging period.

To take a familiar example, a speed limit of 55 MPH means one thing if it is violated by exceeding

the limit at one instant (the way such limits are in fact applied), quite another if it were violated only

by a motorist who exceeded 55 MPH averaged over an hour. In the latter form, the long-distance

commuter could go at 75 where the roads would handle it, and use the crawling pace of center-city

traffic to bring his average down to the permitted maximum. Similarly, a plant that must average 1.0

lbs/mmBtu annually is a good deal less constricted than one that must satisfy that standard at every

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8 Although it appears that EPA regulations initially provided a two-hour averaging period, see

36 Fed. Reg. 24,879 (Dec. 23, 1971), codified at 40 C.F.R. § 60.43(b) (1972), the reference was

later removed, see 39 Fed. Reg. 20,792 (June 14, 1974), codified at 40 C.F.R. § 60.43(a)(2)

(current version). In the current rulemaking, the EPA took the view that "if a number [pounds

per unit of energy] is specified it may be considered to be applicable at any time a measurement

may be made." 57 Fed. Reg. 30,034, 30,039/2 (July 7, 1992) [J.A. 493]. Petitioners do not

contest this assertion. 

instant in time. Indeed, under the EPA's calculations, which are not contested, a limit of 1.0

lbs/mmBtu measured instantaneously turns into 0.89 lbs/mmBtu averaged annually. The petitioners

in this aspect of the case have plants subject to emissions limitations that are simply expressed in

pounds per million Btu; but, as they conceded at oral argument, those limitations were to be applied

on an instantaneous basis.8 Nonetheless, they object to the EPA's application of its 0.89 conversion

factor.

Before addressing petitioners' linguistic arguments, we note briefly a colloquy at oral

argument. One of the panel asked counsel "why in the world" Congress would notrequire conversion

for limitations expressed in lbs/mmBtu but not on an annual basis, and counsel could offer no theory.

We agree with the view implicit in his candid silence. A trading scheme requires fungible units, as

petitioners' brief points out: "[The] variations in the expression of emissions limitations meant that

a single, standard form of expression for the 1985 allowable emissions limitation had to be

established, and limitations expressed in other forms had to be converted to the standard form"and

there is no reason why the temporal component of the limitation should go unstandardized.

Accordingly, in examining the linguistic arguments we start from the unusual perspective that, for

petitioners' arguments to prevail, they must be powerful enough to justify a reading that is conceded

to make no sense.

To see petitioners' argument most clearly, we repeat the provision, emphasizing the words

that petitioners regard as pivotal:

Where the emissions limitation for a unit is not expressed in pounds of emissions per

million Btu, or the averaging period of that emissions limitation is not expressed on

an annual basis, the Administrator shall calculate the annual equivalent of that

emissions limitation in pounds per million Btu to establish the allowable 1985

emissions rate.

§ 402(18), 42 U.S.C. § 7651a(18) (emphasis added). The argument runs that "that emissions

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limitation" must refer back to the words ahead of the "or," under the so-called "last antecedent"

doctrine ofstatutoryconstruction. Under this view, Congressdespite the "or"addressed only the

problem of pre-existing limitations that were not expressed in pounds per million Btu at all. The

second clause, addressing the case where the averaging period "of that emissions limitation" is not

expressed on an annual basis,supposedly meansthat where a limit is not expressed in lbs/mmBtu and

has an averaging period of less than a year, the limit is not only converted to lbs/mmBtu but also

annualized. (According to the argument, this annualization would not be required at all were it not

for this second clause, even though other language expressly directs the Administrator to "calculate

the annual equivalent....")

The government responds that the "last antecedent" rule is not absolute, and, indeed, so we

have observed. United States v. Pritchett, 470 F.2d 455, 458-59 (D.C. Cir. 1972) ("[The] Rule of

the Last Antecedent is not an inflexible rule, and is not applied where the context indicates

otherwise.") (footnote omitted) (but finding no such indication in that case). Moreover, the

government offers a sensible explanation of the phrase "that emissions limitation," namely, that it is

a reference back to the phrase "the emissions limitation for a unit" in the opening words of the

sentence. The explanation is perhaps a little awkward, in the sense that the second "trigger" for

calculating emissions in terms of lbs SO2/mmBtu averaged over a year uses a referent to a phrase

embodied in the statement of the first trigger. But this minor awkwardness seems a peccadillo

compared to the effect of petitioners' reading, which is to give a windfall to plants whose limitations

were expressed as lbs/mmBtu but without a one-year averaging period (and to virtually deny the

second phrase any independent force).

Petitioners have anotherstring to their bow. The second clause, even under the government's

reading, is confined to lbs/mmBtu limitations "not expressed on an annual basis." Petitioners argue

that their limitations were not expressed on any temporal basis at all, so that they are completely

outside the scope of § 402(18)'s provision for annualization.

In its use of the 0.89 adjustment factor, the government evidently reasonedand petitioners

do not disputethat there are no material differences between limits applicable on a strictly

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instantaneous basis and ones averaged over a period equal to or less than one day. See National

Allowance Data Base, Version 2.11, Technical Support Document F-2. The government also

saysand again petitioners do not disputethat limits stated without averaging periods are, as a

practical matter under modern measuring technology, measurable over a period of a day or less.

Thus, EPA's uncontested assumptions are in full accord with what it did heretreat petitioners as

if their limits had expressly provided for averaging over a period of a day or less. See note 1 above.

Of course, if the understanding implicit in their limitations had been that they could average over a

longer period, they would have had a good case for use of a more favorable conversion factor. But

they assert no such implicit understanding. Accordingly, their claim is meritless.

* * *

For the above reasons, the petitions for review are 

denied.

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