• 

o 

JUt 1 8 2013 

Is Board 

(Slip Opinion) 

NOTICE: This opinion is subject to formal revision before 

publication in the Environmental AdrninistrativeDecisions (E.A.D.). 

Readers are requested to notify the Environmental Appeals Board, 

U.S. Environmental Protection Agency, Washington, D.C. 20460, of 

any typographical or other formal errors, in order that corrections 

may be made before pUblication. 

BEFORE THE ENVIRONMENTAL APPEALS BOARD 


UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 


WASHINGTON, D.C. 


) 

) 

In re: ) 

) 

Sierra Pacific Industries ) PSDAppealNos.13-01, 

(Anderson Processing Facility) ) 13-02, 13-03 & 13-04 

) 

PSD Permit No. SAC 12-01 ) 

------------------------ ) 

[Decided July 18,2013] 

ORDER REMANDING IN PART AND 

DENYING REVIEW IN PART 

Before Environmental Appeals Judges Leslye M. Fraser, 

Randolph L. Hill, and Kathie A. Stein. 
IN RE SIERRA PACIFIC INDUSTRIES

(ANDERSON PROCESSING FACILITY)

PSD Appeal Nos. 13-01, 13-02, 13-03 & 13-04

ORDER REMANDING IN PART AND

DENYING REVIEW IN PART

Decided July 18, 2013

Syllabus

Ms. Celeste Draisner, Mr. Rob Simpson, Ms. Heidi Strand, and Mr. Ed W.

Coleman (“Petitioners”) each petition the Environmental Appeals Board (“Board”) to

review a Clean Air Act prevention of significant deterioration (“PSD”) permit, PSD

Permit No. SAC 12-01, that the United States Environmental Protection Agency

(“EPA” or “Agency”) Region 9 (“Region”) issued to Sierra Pacific Industries (“Sierra

Pacific”) on February 22, 2013. The permit authorizes Sierra Pacific to construct and

operate a new biomass and natural gas boiler in the City of Anderson in Shasta

County, California. Both the Region and Sierra Pacific filed responses to the

Petitions, and the parties subsequently submitted supplemental briefs in response to a

Board order. 

All of the Petitioners challenge the Region’s decision not to hold a public

hearing on the draft permit under 40 C.F.R. § 124.12(a). Collectively, Petitioners also

assert that the Region made several other procedural and substantive errors in

approving the permit, including: exempting the proposed facility from carbon dioxide

limits; improperly paraphrasing submitted comments in the Region’s response to

comments document; failing to consider comments submitted directly to the permit

writer instead of to the address indicated in the Region’s public notice; treating Sierra

Pacific’s proposed new boiler as a modification to its current PSD permit instead of a

new PSD source; improperly evaluating the air quality impacts of fine particulate

matter emissions; relying on outdated air models; and failing to consider solar energy

and variations of the new boiler’s fuel mix when determining the best available

control technology (“BACT”).

Held: The Board grants review of the petitions in part and orders the

Region to hold a public hearing. The Board denies review of the various other

procedural and substantive challenges that Petitioners raised.

(1) Public Hearing Issue.

The Board holds that the Region clearly erred in failing to grant the requests

for a mandatory public hearing under 40 C.F.R. § 124.12(a)(1). Specifically, the
2 SIERRA PACIFIC INDUSTRIES

Board holds that the Region abused its discretion in determining whether there was a

“significant degree of public interest” in the draft permit, the trigger under

section 124.12(a)(1) for when a public hearing must be held. The Board concludes

that there is no bright-line test for defining this standard but that the requirement for a

“significant degree” of public interest means that there must be a showing of more

than just “any public interest” to satisfy the standard. The Board examined the degree

of public interest in the draft Sierra Pacific permit by considering the following

factors identified in EPA rule preambles, prior EPA Administrator and Board

decisions, and the Region’s Response to the Petition and Supplemental Brief: the

materiality of the issues raised in commenters’ requests for a public hearing; the

number of hearing requests and comments; the degree of public interest in related

State or local proceedings; the amount of media coverage; the significance of the

permit action; whether any substitute process was provided; and demographic

information. The Board concludes that several of these factors indicate that there was

a significant degree of public interest in the Sierra Pacific permit proceedings and

none of the factors suggest otherwise.

(2) Other Issues.

The Board holds further that the Petitioners failed to demonstrate that

review is warranted on any of the other issues they challenged. Specifically, the

Board rules that:

(a) The Region did not clearly err or abuse its discretion in

paraphrasing or summarizing public comments;

(b) The Region did not clearly err or abuse its discretion in excluding

improperly submitted public comments;

(c) The Region did not clearly err or abuse its discretion in

categorizing Sierra Pacific’s proposed boiler as a “major

modification” rather than as a “major stationary source”;

(d) The Region did not clearly err or abuse its discretion in its

treatment of fine particulate matter emissions issues; and

(e) The Region did not clearly err or abuse its discretion in

determining that the addition of a solar energy component or the

alteration of the 90% biomass-10% natural gas fuel mix would

“redefine the source.”

Finally, the Board declines to reach the challenge to the Region’s decision

to rely on the Agency’s carbon dioxide “Deferral Rule,” pursuant to which the Region

deferred consideration of Sierra Pacific’s biogenic carbon dioxide emissions. Instead,

the Board expects that the Region will consider this challenge consistent with EPA’s

decisions on how to proceed in the wake of the United States Court of Appeals for the

District of Columbia Circuit’s recent vacatur of this rule.
SIERRA PACIFIC INDUSTRIES 3

Before Environmental Appeals Judges Leslye M. Fraser,

Randolph L. Hill, and Kathie A. Stein.

Opinion of the Board by Judge Fraser:

I. STATEMENT OF THE CASE

Ms. Celeste Draisner, Mr. Rob Simpson, Ms. Heidi Strand,

and Mr. Ed W. Coleman (“Petitioners”) each petition the

Environmental Appeals Board (“Board”) to review a Clean Air Act

(“CAA”) prevention of significant deterioration (“PSD”) permit, PSD

Permit No. SAC 12-01, that the United States Environmental

Protection Agency (“EPA” or “Agency”) Region 9 (“Region”) issued

to Sierra Pacific Industries (“Sierra Pacific”) on February 22, 2013.

The permit authorizes Sierra Pacific to construct and operate a new

biomass and natural gas boiler in the City of Anderson in Shasta

County, California. Both the Region and Sierra Pacific have filed

responses to the Petitions. For the reasons discussed below, the Board

is granting the petitions in part so that a public hearing may be held.

The Board also is denying the petitions in part on various procedural

and substantive challenges that Petitioners have raised. 

II. ISSUES

This appeal presents the following issues for resolution by this

Board:

(A) Did the Region clearly err or abuse its discretion in declining

to hold a public hearing?

(B) Did the Region clearly err or abuse its discretion in choosing

to paraphrase or summarize certain public comments in the

course of responding to those comments?

(C) Did the Region clearly err or abuse its discretion by declining

to include in the administrative record public comments that

were mailed to an address other than the ones specified in the

public notice?
4 SIERRA PACIFIC INDUSTRIES

 A “major stationary source” is any of a list of specific types of stationary 1

sources that emit, or have the potential to emit, 100 tons per year or more of any

“regulated NSR [(New Source Review)] pollutant,” as defined in 40 C.F.R.

§ 52.21(b)(50). 40 C.F.R. § 52.21(b)(1)(i). A “major modification” is “any physical

change in or change in the method of operation of a major stationary source” that would

result in: (1) a “significant emissions increase,” as defined in 40 C.F.R. § 52.21(b)(40)

(continued...)

(D) Did the Region clearly err or abuse its discretion in

categorizing the proposed facility as a new “major

modification” rather than as a new “major stationary source”?

(E) Did the Region clearly err or abuse its discretion in analyzing

and treating fine particulate matter emissions from the

proposed facility?

(F) Did the Region clearly err or abuse its discretion in

determining that the addition of a solar energy component or

alteration of the 90% biomass-10% natural gas fuel mix would

“redefine the source” and therefore need not be considered in

the best available control technology analyses for the project?

(G) Did the Region clearly err or abuse its discretion in deferring

consideration of carbon dioxide emissions from the proposed

facility, in accordance with an Agency rule that had been

appealed to the United States Court of Appeals for the District

of Columbia Circuit?

III. OVERVIEW OF PSD LEGAL REQUIREMENTS

Petitioners challenge a PSD permit issued under the CAA.

The PSD provisions govern air pollution in certain areas, called

“attainment” areas, where the air quality meets or is cleaner than the

national ambient air quality standards, as well as in unclassifiable

areas that are neither attainment nor “nonattainment.” CAA

§§ 160-169, 42 U.S.C. §§ 7470-7479; accord In re RockGen Energy

Ctr., 8 E.A.D. 536, 541 (EAB 1999). The statutory PSD provisions

are largely carried out through a regulatory process that requires new

major stationary sources, or modifications of such sources, in 1
SIERRA PACIFIC INDUSTRIES 5

(...continued) 1

and (b)(23), of a regulated NSR pollutant; and (2) a “significant net emissions increase

of that pollutant from the major stationary source.” Id. § 52.21(b)(2)(i).

attainment (or unclassifiable) areas, such as Sierra Pacific’s biomass

boiler, to obtain preconstruction permits pursuant to CAA § 165,

42 U.S.C. § 7475. See 40 C.F.R. § 52.21; RockGen, 8 E.A.D. at 541;

In re Knauf Fiber Glass, GmbH (“Knauf I”), 8 E.A.D. 121, 123 (EAB

1999).

To obtain a permit, new major stationary sources or

modifications of such sources must employ the “best available control

technology,” or “BACT,” to minimize emissions of regulated

pollutants. CAA § 165(a)(4), 42 U.S.C. § 7475(a)(4); 40 C.F.R.

§ 52.21(j)(2). The statute defines the BACT requirements as follows:

The term “best available control technology” means

an emission limitation based on the maximum degree

of reduction of each pollutant subject to regulation

under this chapter emitted from or which results from

any major emitting facility, which the permitting

authority, on a case-by-case basis, taking into account

energy, environmental, and economic impacts and

other costs, determines is achievable for such facility

through application of production processes and

available methods, systems, and techniques, including

fuel cleaning, clean fuels, or treatment or innovative

fuel combustion techniques for control of each such

pollutant.

CAA § 169(3), 42 U.S.C. § 7479(3); accord 40 C.F.R. § 52.21(b)(12)

(similar regulatory definition). As the Board explained in In re

Northern Michigan University (“NMU”), the BACT definition

requires permit issuers to “proceed[] on a case-by-case basis, taking a

careful and detailed look, attentive to the technology or methods

appropriate for the particular facility, [] to seek the result tailor-made

for that facility and that pollutant.” PSD Appeal No. 08-02, slip op.

at 12 (EAB Feb. 18, 2009), 14 E.A.D. ___ (citations and quotations
6 SIERRA PACIFIC INDUSTRIES

 The consolidated permit regulations also apply to National Pollutant 2

Discharge Elimination System (“NPDES”) permits issued under sections 318, 402, and

405 of the Clean Water Act, 33 U.S.C. §§ 1328, 1342, and 1345; Underground Injection

Control (“UIC”) permits issued under Part C of the Safe Drinking Water Act (“SDWA”),

42 U.S.C. §§ 300h to 300h-8; and hazardous waste management permits issued under

section 3005 of the Resource Conservation and Recovery Act (“RCRA”), 42 U.S.C.

§ 6925. 40 C.F.R. § 124.1(a). 

omitted). BACT is therefore a site-specific determination that results

in the selection of an emission limitation representing application of

control technology or methods appropriate for the particular facility.

In re Prairie State Generating Co., 13 E.A.D. 1, 12 (EAB 2006), aff’d

sub nom. Sierra Club v. EPA, 499 F.3d 653 (7th Cir. 2007); In re

Three Mountain Power, LLC, 10 E.A.D. 39, 47 (EAB 2001); Knauf I,

8 E.A.D. at 128-29.

Section 165(a) of the CAA provides that a PSD permit may

not be issued unless “a public hearing has been held with opportunity

for interested persons including representatives of the Administrator to

appear and submit written or oral presentations on the air quality

impact of such source, alternatives thereto, control technology

requirements, and other appropriate considerations.” 42 U.S.C.

§ 7475(a)(2). CAA section 160(5) specifies that one purpose of the

PSD program is to “assure that any decision to permit increased air

pollution * * * is made only after * * * adequate procedural

opportunities for informed public participation in the decisionmaking

process.” 42 U.S.C. § 7470(5). EPA’s consolidated permit

regulations, which in part implement CAA § 160(5), state that the

permit issuer “shall hold a public hearing whenever he or she finds, on

the basis of requests, a significant degree of public interest in a draft

permit(s).” 40 C.F.R. § 124.12(a)(1). The consolidated permit 2

regulations also give the permit issuer the discretion to hold a public

hearing “whenever, for instance, such a hearing might clarify one or

more issues involved in the permit decision.” Id. § 124.12(a)(2).

IV. PROCEDURAL AND FACTUAL HISTORY

Currently, Sierra Pacific operates a wood-fired boiler with

associated air pollution control equipment and conveyance systems at
SIERRA PACIFIC INDUSTRIES 7

 A bone-dry ton is 2,000 pounds of wood pulp or residue at zero percent 3

moisture content.

 On March 3, 2003, EPArevoked and rescinded SCAQMD’s authority to issue 4

and modify federal PSD permits for new and modified major sources of attainment

pollutants in Shasta County, and now EPA issues such permits. See AAQIR at 3-4.

its lumber manufacturing facility in Anderson, California. Region 9’s

Resp. to the Petitions for Review (“Reg. 9 Resp.”) attach. 1, excerpt

(“exc.”) 1, at 1 (EPA Region 9, Prevention of Significant

Deterioration Permit for Sierra Pacific Industries, Anderson Facility,

PSD Permit No. SAC-01, at 1 (Feb. 19, 2013)) (“Permit”). The Shasta

County Air Quality Management District (“SCAQMD”) issued a PSD

permit for this boiler in 1994. See Reg. 9 Resp. at 2 n.3. On

March 29, 2010, Sierra Pacific requested the Region’s approval to

construct and operate at this same location a new cogeneration unit

burning clean cellulosic biomass during normal operations and natural

gas for startup and shutdown. Id. attach. 1, exc. 2, at 3-4 (EPA

Region 9, Statement of Basis and Ambient Air Quality Impact Report,

Sierra Pacific Industries-Anderson, PSD Permit No. SAC 12-01 (Sept.

2013)) (“AAQIR”). Sierra Pacific’s proposed new cogeneration unit

is to be used for producing steam to heat its existing kilns for drying

lumber, and to generate electricity both for use at the Sierra Pacific

facility in Anderson and for sale to the electrical grid. Permit at 1;

AAQIR at 4. Specifically, Sierra Pacific indicated that the new

proposed boiler will have the capacity to consume a maximum of

219,000 bone-dry tons (“BDT”) of biomass per year. Approximately 3

80,000 BDT will be generated by the facility’s existing lumber

operations at its current output, and additional wood fuel will be

transported by truck to the facility from Sierra Pacific’s other lumber

operations in California. AAQIR at 4.

Although the Region has replaced the SCAQMD as the

delegated decisionmaker on PSD permits, Shasta County, under the 4

California Environmental Quality Act (“CEQA”), Cal. Pub. Res. Code

§§ 21001-21117, is required to evaluate the environmental

consequences of certain PSD projects, such as the proposed

cogeneration unit at the Sierra Pacific facility. The CEQA required
8 SIERRA PACIFIC INDUSTRIES

the Shasta County Department of Resource Management to prepare an

Environmental Impact Report (“EIR”) that considered potential

impacts of the Sierra Pacific project on “aesthetics, air quality and

greenhouse gases, biological resources, cultural resources, geology

and soils, hazards, hydrology and water quality, noise, public

services/recreation/utilities, and transportation/circulation.” Shasta

County Department of Resource Management, Final EIR for the

Sierra Pacific Cogeneration Power Project (May 2012) (available at

http://www.co.shasta.ca.us/index/drm_index/planning_index/eirs/spi/

Final_EIR.aspx); see Cal. Pub. Res. Code § 21100(a).

Following submission of its March 29, 2010 application,

Sierra Pacific updated its application on July 1, 2010, and

September 8, 2010. See Reg. 9 Resp. attach. 1, exc. 6 (Letter from

Gerardo C. Rios, Chief, Air Div. Permits Office, EPA Reg. 9, to Eric

Albright, Senior Mgr., ENVIRON Int’l Corp. (Oct. 4, 2010)). On

October 4, 2010, the Region issued a letter to Sierra Pacific

determining that its application was administratively complete, id.;

however, the Region, on several occasions, later requested information

from Sierra Pacific to complete its assessment of the permit

application. In response, Sierra Pacific submitted additional data

related to air quality modeling on May 30, 2012, and additional

information regarding air quality impacts in July 2012. See Reg. 9

Resp. at 2 & attach. 1, exc. 5 (Letter from Eric Albright, Senior Mgr.,

ENVIRON Int’l Corp., to Gerardo Rios, EPA Reg. 9 (May 30, 2012)).

On September 14, 2012, the Region proposed to issue a PSD permit

for Sierra Pacific’s new cogeneration unit. Id. attach. 1, exc. 3, at 3

(EPA Region 9, Responses to Public Comments on the Proposed PSD

Permit Major Modification for Sierra Pacific Industries - Anderson

Division 3 (Feb. 2013)) (“RTC”). The Region initiated a public

comment period on the proposed permit through a public notice

published in a local newspaper and a notice on the Region’s website.

Id. Included in the notice was a brief description of the cogeneration

unit covered by the proposed permit, and information concerning

comment procedures and where documents related to the Region’s

permit decision could be accessed. The notice also stated:

Pursuant to 40 CFR 124.12, EPA has discretion to

hold a Public Hearing if we determine there is a
SIERRA PACIFIC INDUSTRIES 9

significant amount of public interest in the proposed

permit. Requests for a Public Hearing must state the

nature of the issues proposed to be raised in the

hearing. If a Public Hearing is to be held, a public

notice stating the date, time and place of the hearing

will be made at least 30 days prior to the hearing.

Reasonable attempts will be made to notify directly

any person who has commented on this proposal of

any pending Public Hearing, provided contact

information has been given to the EPA contact person

listed below.

Any interested person may submit written comments

or request a Public Hearing regarding EPA’s proposed

PSD permit for this modification. All written

comments and requests on EPA’s proposed action

must be received by EPA via e-mail by October 17,

2012, or postmarked by October 17, 2012. Comments

or requests must be sent or delivered in writing to

Omer Shalev at one of the following addresses: 

E-mail: R9airpermits@epa.gov

U.S. Mail: Omer Shalev (AIR-3)

U.S. EPA Region 9

75 Hawthorne Street

San Francisco, CA 94105-3901

Phone: (415) 972-3538

Reg. 9 Resp. attach. 1, exc. 8, at 1-2 (EPA Region 9, Public Notice:

Announcement of Proposed Permit Modification and Request for

Public Comment on Proposed [PSD] Permit for Sierra Pacific

Industries - Anderson Division 1-2 (Sept. 12, 2012)).

The Region distributed the notice to the parties specified in

40 C.F.R. § 124.10(c), which identifies the parties that must be

notified in permit proceedings. It sent approximately 800 notices by

U.S. mail and another 650 by electronic mail, although the Region

acknowledges that this does not amount to notification of 1,450 parties
10 SIERRA PACIFIC INDUSTRIES

See Federal Actions to Address Environmental Justice in Minority Populations 5

and Low-Income Populations, Exec. Order 12,898, 59 Fed. Reg. 7629 (Feb. 16, 1994)

(continued...)

because there is some overlap between the parties receiving U.S. mail

and electronic mail notification. Reg. 9 Resp. at 3. Notified

organizations and individuals included state and local government

agencies, and parties who had requested to be put on lists created by

the Region of parties interested in permit actions in California, or

within Shasta County, as well as parties “known to EPA that may have

an interest in this action.” Id. The Region also published the notice in

the local paper for Redding, California, the Record Searchlight, and on

Region 9’s website. The Region provided only an English version of

the notice because its review of the demographics of Shasta County

indicated that only a very small percentage of residents were

“linguistically isolated.” RTC at 10. In addition to distributing the

notice, the Region made available other documents relating to the

proposed permit at the Region’s office, the SCAQMD’s offices in

Redd in g, the Redd in g Public Library, and online at

www.regulations.gov. See Reg. 9 Resp. attach. 1, exc. 8. The Region

also published the proposed permit and other major documents related

to the permit on its website. See id.

In response to the notice, the Region received requests for a

public hearing from two individuals on their own behalf, Ms. Patricia

Lawrence and Mr. Rob Simpson, and one request from an individual

representing a community organization, Ms. Heidi Strand. On

September 16, 2012, two days after the notice was published,

Ms. Strand made the first of several hearing requests. Reg. 9 Resp.

attach. 2, app. A, at 1 (E-mail from Heidi Strand to Omar Shalev,

Envtl. Eng’r, EPA Reg. 9 (Sept. 16, 2012)). This request stated it was

her “official request for a hearing regarding the PSD change for the

proposed Sierra Pacific Cogeneration plant” and included a letter Ms.

Strand had sent to Sierra Pacific. Id. That letter, sent by Ms. Strand in

her capacity as co-chair of an organization named “Citizens for Clean

Air,” or “CCA,” highlighted an EPA policy stressing the need for

vigorous public outreach by permitting authorities in “environmental

justice” communities and argued that a new permit, not just a permit 5
SIERRA PACIFIC INDUSTRIES 11

(...continued) 5

(directing federal agencies to “make achieving environmental justice part of its mission

by identifying and addressing, as appropriate, disproportionately high and adverse human

health or environmental effects of its programs, policies, and activities on minority

populations and low-income populations in the United States and its territories and

possessions, the District of Columbia, the Commonwealth of Puerto Rico, and the

Commonwealth of the Mariana Islands”).

modification, was needed for Sierra Pacific’s proposed new

cogeneration unit. Id. at 2. The Region responded to this hearing

request on October 1, 2012, informing Ms. Strand that it “does not

currently plan to hold a public hearing for this proposed action” as the

Region had “not received a significant amount of public interest in this

project or additional requests for a public hearing.” Reg. 9 Resp.

attach. 2, app. 1, at 3 (E-mail from Omer Shalev, Envtl. Eng’r, Air

Permits Div., EPA Reg. 9, to Heidi Strand (Oct. 1, 2012)).

Mr. Shalev’s response also noted that, if Ms. Strand still desired a

public hearing, she “must state the nature of the issues proposed to be

raised at the hearing * * * and [the Region] must receive indications

that there is a significant amount of public interest.” Id.

On the same day that she received this e-mail from

Mr. Shalev, Ms. Strand made her second request for a public hearing.

Reg. 9 Resp. attach. 2, app. A, at 4 (E-mail from Heidi Strand, CoCoordinator, CCA, to Omar Shalev, Envtl. Eng’r, EPA Reg. 9 (Oct. 1,

2012, 20:04 PDT)). Ms. Strand identified herself as the cocoordinator for CCA. She stated that her organization had “only heard

about this project on the day I originally wrote to you.” She argued

that the “threshold for public interest is lower in Environmental Justice

Communities” and listed five issues her “community” intended to raise

at the public hearing, including questions regarding the BACT

methods to be used by Sierra Pacific and cumulative impacts on air,

water, and waste disposal from the cogeneration unit. Id. One of the

issues identified by Ms. Strand specifically addressed the question of

the showing that was necessary to obtain a public hearing: “What are

your agenc[y’]s procedures for determining the threshold required to

hold a public hearing?” Id. Ms. Strand’s phrasing of her issues for a

hearing suggested that she was seeking further information from the
12 SIERRA PACIFIC INDUSTRIES

 The other four issues listed by Ms. Strand were: “(1) What methods of BACT 6

(Best Available Control Technology) are being utilized by Sierra Pacific in the new

construction of this Cogeneration plant? (2) Can you provide us with a discussion of the

cumulative impacts of air, water and waste disposal methods proposed for this new

project? (3) Can you provide any information regarding Sierra Pacific’s environmental

violations at their pre-existing Shasta County facilities and operations? * * * (5) Why

doesn’t EPA Region 9 require Sierra Pacific to secure a new PSD Permit for this new

facility?” 

Region at a hearing rather than indicating that she had information to

present. Id.

6

On October 4, 2013, Mr. Shalev responded to Ms. Strand’s

second hearing request. Reg. 9 Resp. attach 2, app. A, at 5 (E-mail

from Omer Shalev, Envtl. Eng’r, Air Permits Div., EPA Reg. 9, to

Heidi Strand (Oct. 4, 2012, 17:08 PDT)). He referred Ms. Strand to a

Fact Sheet on the proposed permit, “which explains the basis for the

proposed permit * * * and discusses many of the concerns that you

raise in your e-mail regarding the project,” and encouraged her to

submit written comments by the October 17, 2013 deadline. However,

he did not respond to her question about the threshold showing needed

for obtaining a public hearing. See id.

Later that same day, Ms. Strand filed her third request for a

hearing. Reg. 9 Resp. attach. 2, app. A, at 6 (E-mail from Heidi

Strand, Co-Coordinator, CCA, to Omar Shalev, EPA Reg. 9 (Oct. 4,

2012, 21:52 PDT)). Ms. Strand indicated that the Fact Sheet did not

satisfy her organization’s concern that a new permit, not a

modification, should be required for the Sierra Pacific project. She

closed by stating, “Again I am requesting a public hearing.” Id. The

next day, Mr. Shalev responded to Ms. Strand’s third e-mail. He

explained that Region was proposing “a PSD permit modification [for]

an additional cogeneration unit at an existing facility.” Reg. 9 Resp.

attach. 2, app. A, at 7 (E-mail from Omer Shalev, Envtl. Eng’r, Air

Permits Div., EPA Reg. 9, to Heidi Strand (Oct. 5, 2012, 10:06 PDT)).

He also referenced an existing cogeneration unit adjacent to the new

unit that was being regulated by SCAQMD and he referred her to

SCAQMD for more information on this facility. Mr. Shalev did not

address Ms. Strand’s renewed hearing request. See id.
SIERRA PACIFIC INDUSTRIES 13

 Petitioner also asserted that “since Shasta County is an Environmental Justice 7

community, the standard for review under Environmental Justice Guidelines in such

communities is exceptionally low. Region 9 is the lead as well as advisory agency for

Executive Orders #12898 and #13563. It is reasonable to expect the highest standards

from the Region.” Resp. to Order to Show Cause at 3, In re Sierra Pac. Indus., PSD

Appeal No. 12-03 (EAB Dec. 21, 2012). Mr. Coleman submitted the petition on behalf

of CCA; Ms. Strand and Ms. Draisner also are members of CCA. Reg. 9 Resp. attach. 2,

app. A, at 2; Draisner Pet. for Review at 1.

Additional e-mails followed, in which Ms. Strand contended

that the new facility was not undergoing the full PSD permitting

process. Reg. 9 Resp. attach. 2, app. A, at 8 (E-mail from Heidi

Strand, Co-Coordinator, CCA, to Omar Shalev, EPA Reg. 9 (Oct. 5,

2012, 10:39 PDT)). In a final e-mail on October 5, 2012, Mr. Shalev

stated: “Thank you again for your interest. Please be sure to submit

written comments regarding your concerns by the end of the public

comment period on October 17, 2012.” Reg. 9 Resp. attach. 2, app. A,

at 9 (E-mail from Omer Shalev, Envtl. Eng’r, Air Permits Div., EPA

Reg. 9, to Heidi Strand (Oct. 5, 2012, 14:27 PDT)).

Dissatisfied with the Region’s preliminary decision not to hold

a public hearing, CCA petitioned the Board, on October 16, 2012,

seeking review of the Region’s “hearing denial.” The petition alleged

that the Region erred by: (1) asserting [the Region] “had discretion to

hold a Public Hearing if [the Region] determined there is a significant

amount of public interest,” but at the same time not providing any

significant details on what the threshold for the public to obtain a

public hearing might be; and (2) determining that no significant

amount of public interest existed. Resp. to Order to Show Cause at 3, 7

In re Sierra Pac. Indus., PSD Appeal No. 12-03 (EAB Dec. 21, 2012).

Noting that 40 C.F.R. § 124.19 does not allow a challenge to a hearing

denial until a final permit decision has been issued, the Board

dismissed this appeal as premature. In re Sierra Pac. Indus., PSD

Appeal No. 12-03, at 5 (EAB Dec. 21, 2012) (Order Dismissing

Petition for Review Without Prejudice as Prematurely Filed). The

Board pointed out that “the Region still could decide in response to

public comments to hold a public hearing before issuing a final permit

decision.” Id. In dismissing the appeal, the Board expressed no

opinion on the merits of CCA’s claim but did indicate that the Region
14 SIERRA PACIFIC INDUSTRIES

should “[i]n its response to comments document, * * * provide a wellreasoned explanation of why it declined the citizen group’s request for

a public hearing in light of the statute and regulations and how it took

the environmental justice Executive Order into account. In particular,

see CAA § 165(a)(2), 42 U.S.C. § 7475(a)(2).” Id. at 6 n.3.

Ms. Patricia Lawrence also submitted a written request for a

public hearing. Reg. 9 Resp. attach. 1, exc. 9 (E-mail from Patricia

Lawrence to EPA Reg. 9 (Oct. 17, 2012)). On October 17, 2012, she

requested that the Region hold a public hearing on a number of broad

issues raised by Sierra Pacific’s proposed cogeneration facility.

Specifically, Ms. Lawrence suggested that a hearing should be held to

address: (1) the adequacy of the evaluation of the cumulative impacts

of total air pollution in California’s upper central valley; (2) whether a

biomass plant should be given preference over a solar panel

manufacturer in allocating the clean air in the upper central valley;

(3) whether BACT would remove dioxins from household and

industrial wastes that can be burned at the facility; and (4) whether

burning wood waste would release a huge carbon sink affecting global

warming. Id. Similar to Ms. Strand’s requests, as worded,

Ms. Lawrence’s hearing request suggested that she also was seeking

information on these points from the Region rather than expressing an

intent to present information to the Region. 

The third requestor was Mr. Simpson, who submitted a request

for a public hearing with his written comments. Reg. 9 Resp.

attach. 1, exc. 9, at 5. Unlike the other two requestors, Mr. Simpson

submitted comments in some detail, including comments on the BACT

and air quality impact analyses. Id. at 5-8. For example, Mr. Simpson

argued that the proposed facility’s “fuel mix” (i.e., the ratio of biomass

to natural gas burned in the new boiler) should be evaluated as part of

the BACT analysis because a higher gas component would burn

cleaner and reduce facility emissions. He also stated that a solar

energy component and energy efficiency options should be

incorporated into the BACT analysis. Mr. Simpson presented a

number of other challenges to technical and procedural aspects of

Sierra Pacific’s permit. In so doing, he did not explicitly list the

matters he intended to question at a public hearing, but a fair reading
SIERRA PACIFIC INDUSTRIES 15

of his comments indicates that he sought further information on and

consideration of each of those issues by the Region.

After reviewing these requests, the Region decided not to hold

a public hearing. In its Response to Comments document, the Region

stated that “[n]one of the requests for a public hearing demonstrated

that there was significant public interest in the Project.” RTC at 10,

11, 38. Other than mentioning the extent of its efforts to provide

notice of the proposed permit and that there had been fifteen

comments on the proposed permit, the Region provided no other

explanation for its denial of the hearing and also failed to address the

“threshold for holding a public hearing” question that Ms. Strand had

raised in her October 1, 2012 e-mail to Mr. Shalev, or the arguments

CCA had made challenging the preliminary hearing denial in its

premature petition. Id. at 10.

As stated above, Ms. Strand, Mr. Simpson, Ms. Draisner, and

Mr. Coleman filed petitions appealing the Region’s final permit

decision to the Board. All four Petitioners challenge the Region’s

denial of the requests for a public hearing. Petitioners assert that the

“significant degree of public interest” standard in 40 C.F.R.

§ 124.12(a)(1) is “nebulous” and the Region has failed to give “an

accurate explanation of its threshold requirements.” Simpson Pet. at 5;

Coleman 1st Am. Pet. at 4. Petitioners also argue that the Region’s

Response to Comments document failed to provide an adequate

explanation of why the Region denied their hearing requests. Simpson

Pet. at 5; Draisner Pet. at 3; Coleman 1st Am. Pet. at 7. Mr. Coleman

specifically claims that the Region did not explain the hearing denial

“in light of the statute” and references CAA section 165(a)(2), while

Mr. Simpson cites CAA section 160(5). Coleman 1st Am. Pet. at 7;

Simpson Pet. at 4. Finally, Mr. Coleman asserts that the hearing

denial violated Executive Order 12,898 on Environmental Justice and

EPA’s environmental justice guidelines and policies. Coleman 1st

Am. Pet. at 5-6.

In its response brief, the Region argues that it was not required

to hold a public hearing under 40 C.F.R. § 124.12(a)(1) because it had

“reasonably determined that * * * the Project did not meet the

threshold of ‘significant’ that would mandate a public hearing.” 
16 SIERRA PACIFIC INDUSTRIES

Reg. 9 Resp. at 8. The Region judged the public interest in the draft

permit to be insignificant because “only a few individuals requested a

public hearing, out of literally hundreds of persons who were directly

contacted about the Project by Region 9.” Id. at 8-9. Further, the

Region defended not granting a hearing “to clarify the issues” under

its discretionary authority in 40 C.F.R. § 124.12(a)(2). The Region

argued that because the issues raised by requestors involved “inquiries

related to topics already included in the administrative record” or

could be addressed by a written response, a hearing was not necessary

to clarify the issues. Id. at 9-10. As to Mr. Coleman’s environmental

justice claims, the Region asserts that it adequately took demographic

information on the community into account in designing outreach

materials. Id. at 11-12.

Because neither the Region’s Response to Comments

document nor its response to the petitions discussed the relevance of

CAA section 165 to the hearing denial issue that two of the Petitioners

had raised, the Board directed the Region to submit a supplemental

brief addressing two questions concerning section 165. See Order

Directing Supplemental Briefing (May 16, 2013). First, the Board

asked how the “significant degree of public interest” standard in

40 C.F.R. § 124.12(a)(1) should be interpreted in light of the

requirements on public hearings in CAA section 165. Second, noting

that the hearing requestors had, in part, sought a hearing for the

purpose of obtaining clarification of certain issues from the Region,

the Board asked what weight this fact should be given in light of the

public participation policy enunciated in the CAA, and the language in

section 165(a)(2) indicating that public hearings presented the

“opportunity for interested persons including representatives of the

Administrator to appear and submit written or oral presentations” on

considerations relevant to the permit. The Board gave Sierra Pacific

and the Petitioners the option of responding to the Region’s

supplemental brief. The Region, Sierra Pacific, Ms. Strand, and Ms.

Draisner submitted briefs addressing the Board’s questions.

Petitioners also have raised a variety of other procedural

issues, as well as substantive issues, in their appeals. To promote

efficiency in the permit appeal process, the Board has decided a

number of these issues in Part VII.C below. Additionally, in Part VI
SIERRA PACIFIC INDUSTRIES 17

below, the Board addresses motions filed by three of the petitioners –

Mr. Coleman, Ms. Strand, and Ms. Draisner – requesting that the

Board accept late filings.

V. PRINCIPLES GOVERNING BOARD REVIEW

Section 124.19 of Title 40 of the Code of Federal Regulations

governs Board review of a PSD permit. In any appeal from a permit

decision issued under part 124, the petitioner bears the burden of

demonstrating that review is warranted. See 40 C.F.R. § 124.19(a)(4). 

A. Standard of Review

The Board has discretion whether to review a PSD permit. In

re Avenal Power Ctr., LLC, PSD Appeal Nos. 11-02 to 11-05, slip op.

at 14-15 (EAB Aug. 18), 15 E.A.D. ___, appeal docketed sub nom.

Sierra Club v. EPA, No. 11-73342 (9th Cir. Nov. 3, 2011). Ordinarily,

the Board will not review a PSD permit unless the permit decision

either is based on a clearly erroneous finding of fact or conclusion of

law, or involves a matter of policy or exercise of discretion that

warrants review. 40 C.F.R. § 124.19(a)(4)(A)-(B); accord, e.g., In re

Prairie State Generating Co., 13 E.A.D. 1, 10 (EAB 2006), aff’d sub

nom. Sierra Club v. EPA, 499 F.3d 653 (7th Cir. 2007).

When evaluating a challenged permit decision for clear error,

the Board examines the administrative record that serves as the basis

for the permit to determine whether the permit issuer exercised his or

her “considered judgment.” See In re Steel Dynamics, Inc., 8 E.A.D.

165, 191, 224-25 (EAB 2000); In re Ash Grove Cement Co., 7 E.A.D.

387, 417-18 (EAB 1997). The permit issuer must articulate with

reasonable clarity the reasons supporting its conclusion and the

significance of the crucial facts it relied upon when reaching its

conclusion. E.g., In re Shell Offshore, Inc., 13 E.A.D. 357, 386 (EAB

2007). As a whole, the record must demonstrate that the permit issuer

“duly considered the issues raised in the comments” and ultimately

adopted an approach that “is rational in light of all information in the

record.” In re Gov’t of D.C. Mun. Separate Storm Sewer Sys.,

10 E.A.D. 323, 342 (EAB 2002); accord In re City of Moscow,

10 E.A.D. 135, 142 (EAB 2001); In re NE Hub Partners, LP, 7 E.A.D.
18 SIERRA PACIFIC INDUSTRIES

 For example, a petition for review ordinarily must be filed with the Board 8

within 30 days of service of notice of the final permit decision by the permitting

authority. 40 C.F.R. § 124.19(a)(3). The 30-day period within which a person may

request review begins with the service of notice unless the permitting authority specifies

a later date. Id. In cases where the filing date falls on a weekend or legal holiday, a

petitioner has until the next working day to file the petition. Id. § 124.20(c).

561, 567-68 (EAB 1998), review denied sub nom. Penn Fuel Gas, Inc.

v. EPA, 185 F.3d 862 (3rd Cir. 1999). On matters that are

fundamentally technical or scientific in nature, the Board typically will

defer to a permit issuer’s technical expertise and experience, as long as

the permit issuer adequately explains its rationale and supports its

reasoning in the administrative record. See In re Dominion Energy

Brayton Point, LLC, 12 E.A.D. 490, 510 (EAB 2006); see also, e.g., In

re Russell City Energy Ctr., PSD Appeal Nos. 10-01 to 10-05, slip op.

at 88 (EAB Nov. 18, 2010), 15 E.A.D. ___, petition denied sub nom.

Chabot-Las Positas Cmty. Coll. Dist. v. EPA, No. 10-73870 (9th Cir.

May 4, 2012); In re Peabody W. Coal Co., 12 E.A.D. 22, 40-41, 46,

51 (EAB 2005); NE Hub, 7 E.A.D. at 570-71.

In reviewing an exercise of discretion by the permitting

authority, the Board applies an abuse of discretion standard. See In re

Guam Waterworks Auth., NPDES Appeal Nos. 9-15 & 9-16, slip op.

at 9 n.7 (EAB 2011), 15 E.A.D. ___. The Board will uphold a

permitting authority’s reasonable exercise of discretion if that decision

is cogently explained and supported in the record. See Ash Grove,

7 E.A.D. at 397 (“[A]cts of discretion must be adequately explained

and justified.”); see also Motor Vehicles Mfrs. Ass’n v. State Farm

Mut. Auto. Ins. Co., 463 U.S. 29, 48 (1983) (“We have frequently

reiterated that an agency must cogently explain why it has exercised its

discretion in a given manner * * *.”).

B. Petitioner’s Burden on Appeal, Including Threshold Requirements

In determining whether to review a petition filed under

40 C.F.R. § 124.19(a), the Board first considers whether the petitioner

has met threshold procedural requirements such as timeliness,8
SIERRA PACIFIC INDUSTRIES 19

 In general, a petitioner must establish standing to appeal by demonstrating 9

prior involvement in the public review process, either by filing written comments on the

draft permit or by participating in a public hearing. 40 C.F.R. § 124.19(a)(2). 

 For example, a petitioner must demonstrate that any issues and arguments it 10

raises on appeal have been preserved for Board review (i.e., were raised during the public

comment period or public hearing on the draft permit), unless the issues or arguments

were not reasonably ascertainable at the time. 40 C.F.R. §§ 124.13, .19(a)(4)(ii); see,

e.g., In re City of Attleboro, NPDES Appeal No. 08-08, slip op. at 10, 58-59 (EAB

Sept. 15, 2009), 14 E.A.D. __; In re City of Moscow, 10 E.A.D. 135, 141, 149-50 (EAB

2001).

 For example, a petitioner must not only generally object to the permit, but 11

also must “clearly set forth, with legal and factual support, petitioner’s contentions for

why the permit decision should be reviewed.” 40 C.F.R. § 124.19(a)(4). Thus, a petition

must be specific and contain, at a minimum, two essential components: (1) clear

identification of the conditions in the permit that are at issue, and (2) an argument that

the conditions warrant review. 40 C.F.R. § 124.19(a)(4)(i); In re Puna Geothermal

Venture, 9 E.A.D. 243, 274 (EAB 2000) (citing In re Beckman Prod. Servs., 5 E.A.D. 10,

18 (EAB 1994)).

 Federal circuit courts of appeal have upheld this Board requirement that a 12

petitioner must substantively confront the permit issuer’s response to the petitioner’s

previous objections. City of Pittsfield v. EPA, 614 F.3d 7, 11-13 (1st Cir. 2010), aff’g

In re City of Pittsfield, NPDES Appeal No. 08-19 (EAB Mar. 4, 2009) (Order Denying

Review); Mich. Dep’t of Envtl. Quality v. EPA, 318 F.3d 705, 708 (6th Cir. 2003)

(continued...)

standing, issue preservation, and specificity. See 40 C.F.R. 9 10 11

§ 124.19; In re Indeck-Elwood, LLC, 13 E.A.D. 126, 143 (EAB 2006).

Assuming that a petitioner satisfies all threshold procedural

obligations, the Board then evaluates the petition to determine if it

warrants review. Indeck, 13 E.A.D. at 143.

As noted above, in any appeal from a permit under part 124,

the petitioner bears the burden of demonstrating that review is

warranted. See 40 C.F.R. § 124.19(a)(4). Thus to the extent a

petitioner challenges an issue the permit issuer addressed in its

response to comments, the petitioner must provide a record citation to

the comment and response and also must explain why the permit

issuer’s previous response to those comments was clearly erroneous or

otherwise warrants review. Id. § 124.19(a)(4)(ii); see, e.g., In re

12
20 SIERRA PACIFIC INDUSTRIES

(...continued) 12

(“[Petitioner] simply repackag[ing] its comments and the EPA’s response as unmediated

appendices to its Petition to the Board * * * does not satisfy the burden of showing

entitlement to review.”), aff’g In re Wastewater Treatment Fac. of Union Twp., NPDES

Appeal Nos. 00-26 & 00-28 (EAB Jan. 23, 2001) (Order Denying Petitions for Review);

LeBlanc v. EPA, No. 08-3049, at 9 (6th Cir. Feb. 12, 2009) (concluding that the Board

correctly found petitioners to have procedurally defaulted where petitioners merely

restated “grievances” without offering reasons why the Region’s responses were clearly

erroneous or otherwise warranted review), aff’g In re Core Energy, LLC, UIC Appeal

No. 07-02 (EAB Dec. 19, 2007) (Order Denying Review). 

Teck Cominco Alaska, Inc., 11 E.A.D. 457, 494-95 (EAB 2004); In re

Westborough, 10 E.A.D. 297, 305, 311-12 (EAB 2002); In re City of

Irving, 10 E.A.D. 111, 129-30 (EAB 2001), review denied sub nom.

City of Abilene v. EPA, 325 F.3d 657 (5th Cir. 2003). The Board

consistently has denied review of petitions that merely cite, attach,

incorporate, or reiterate comments previously submitted on the draft

permit. E.g., In re City of Pittsfield, NPDES Appeal No. 08-19 (EAB

Mar. 4, 2009) (Order Denying Review), aff’d, 614 F.3d 7, 11-13 (1st

Cir. 2010); In re Knauf Fiber Glass, GmbH (“Knauf II”), 9 E.A.D. 1,

5 (EAB 2000) (“Petitions for review may not simply repeat objections

made during the comment period; instead they must demonstrate why

the permitting authority’s response to those objections warrants

review.”); In re Hadson Power 14, 4 E.A.D. 258, 294-95 (EAB 1992)

(denying review where petitioners merely reiterated comments on

draft permit and attached a copy of their comments without addressing

permit issuer’s responses to comments).

When petitions are filed by persons who are unrepresented by

legal counsel, like the petitions here, the Board endeavors to liberally

construe the petitions to fairly identify the substance of the arguments

being raised. In re Sutter Power Plant, 8 E.A.D. 680, 687 (EAB

1999); see also In re Envtl. Disposal Sys., Inc., 12 E.A.D. 254, 292

n.26 (EAB 2005); In re Envotech, LP, 6 E.A.D. 260, 268 (EAB 1996).

While the Board “does not expect such petitions to contain

sophisticated legal arguments or to employ precise technical or legal

terms,” the Board nevertheless “does expect such petitions to provide

sufficient specificity to apprise the Board of the issues being raised.”

Sutter, 8 E.A.D. at 687-88; accord In re P.R. Elec. Power Auth.,
SIERRA PACIFIC INDUSTRIES 21

6 E.A.D. 253, 255 (EAB 1995). “The Board also expects the petitions

to articulate some supportable reason or reasons as to why the

permitting authority erred or why review is otherwise warranted.”

Sutter, 8 E.A.D. at 688; accord In re Beckman Prod. Servs., 5 E.A.D.

10, 19 (EAB 1994). Thus, the burden of demonstrating that review is

warranted still rests with the petitioner challenging the permit

decision. In re New Eng. Plating Co., 9 E.A.D. 726, 730 (EAB 2001);

Encogen, 8 E.A.D. at 249-50.

VI. PENDING PROCEDURAL MOTIONS

Three of the Petitioners, Mr. Coleman, Ms. Strand, and

Ms. Draisner, have filed motions requesting that the Board accept late

filings. Mr. Coleman’s motion asks the Board to accept a late petition

for review. Mr. Coleman submitted three petitions for review. He

filed his original petition and a first amended petition before the filing

deadline of March 26, 2013, and his second amended petition four

days after the filing deadline, on March 30, 2013. On April 9, 2013,

the Board issued an order indicating, among other things, that

Mr. Coleman’s second amended petition was late and that it “was not

accompanied by a motion, did not identify the changes made from the

previous two petitions, and did not provide any justification for the

Board’s acceptance of this amended petition after the deadline

passed.” Order Concerning Board Procedures 1-2 (Apr. 9, 2013). In

response to this Order, Mr. Coleman filed the motion now before the

Board requesting that the Board accept his second amended petition.

Mr. Coleman states that the “main purpose of Ed W. Coleman’s ‘2nd

Amended Petition’ is to present a clean and professional document for

EPA review” and argues that acceptance of this late petition would not

be an “undue burden” on the Board or the Region.

The Board denies Mr. Coleman’s motion. Mr. Coleman’s

second amended petition contains a substantive argument not included

in his first two petitions (that the Region had erroneously treated

Sierra Pacific’s proposal as a permit modification), and Mr. Coleman

has not justified why that argument could not have been included in a

timely petition. Although the Board has permitted late filings in

“special circumstances,” Mr. Coleman has not offered any special

circumstances as a reason for the late filing. See In re AES P.R. LP,
22 SIERRA PACIFIC INDUSTRIES

 Despite the Board’s admonition to Petitioners not to file a document with the 13

Board absent “a proper motion seeking leave of the board to file such document,” Order

Concerning Board Procedures at 1-2, Mr. Coleman and Ms. Strand have continued to file

documents with the Board without requesting permission by motion. The Board has not

considered these documents.

8 E.A.D. 324, 328-29 (EAB 1999) (late filing allowed when aircraft

problems experienced by overnight delivery service resulting in oneday delay); In re Kawaihae Cogeneration Project, 7 E.A.D. 107, 123-

24 (EAB 1997) (late filing allowed when delay was attributable to

permitting authority as it mistakenly instructed petitioners to file

appeals with EPA Headquarters Hearing Clerk).

The Board’s April 9, 2013 Order also noted that Ms. Strand

had submitted supplemental documents after the filing deadline

without a motion justifying the late filing. Order Concerning Board

Procedures at 2. On April 22, 2013, Ms. Strand filed a motion

requesting that the Board accept her late filing. On the same day,

Ms. Draisner also filed a motion requesting that the Board accept

documents that were not timely submitted. Both Ms. Strand and

Ms. Draisner argue that the Board should accept the documents

because they would “assist the Board” and considering them would

not be an “undue burden.” The Board denies both motions. Neither

Petitioner has advanced any explanation as to why these documents

could not have been filed in a timely manner. That the documents

may be relevant and not time consuming to review does not justify

filing them late.13
SIERRA PACIFIC INDUSTRIES 23

VII. ANALYSIS

A. The Region Abused Its Discretion in Determining That There Was

Not a Significant Degree of Public Interest in the Sierra Pacific

Draft Permit and Thus Clearly Erred in Failing to Hold a

Mandatory Public Hearing Under 40 C.F.R. § 124.12(a)(1)

1. The Specific Issue Presented Under 40 C.F.R.

§ 124.12(a)(1) 

Under 40 C.F.R. § 124.12(a), the Region is required to hold a

public hearing on draft PSD, NPDES, and UIC permits if the Region

finds there is a “significant degree of public interest,” and, in its

discretion, also may decide to hold a public hearing “if such a hearing

might clarify one or more issues involved in the permit decision.”

Thus, the regulations provide both a mandatory duty to hold a hearing

in certain circumstances, and a discretionary option to hold a hearing

should the permitting authority deem one appropriate. Petitioners

primarily have focused their challenge to the Region’s hearing denial

on the mandatory requirement to hold a hearing under

section 124.12(a)(1) if the Region finds there is a “significant degree

of public interest.” Mr. Coleman, however, also appears to argue that

the Region erred by not exercising its discretion to grant a public

hearing under section 124.12(a)(2). Accordingly, the Board first turns

to the question of whether the Region clearly erred in determining

there was not a “significant degree of public interest” in a public

hearing on the draft PSD permit for Sierra Pacific. In Part VII.B

below, the Board addresses Mr. Coleman’s argument concerning a

discretionary public hearing under section 124.12(a)(2).

2. The “Significant Degree of Public Interest” Standard

a. Regulatory Clarification

EPA’s regulations do not define the “significant degree of

public interest” standard in 40 C.F.R. § 124.12(a)(1), nor does the

preamble to the final rule provide much clarification. In the preamble,

the Agency responded to a commenter’s description of the standard as

“vague” by noting that “[o]ne of the purposes of having a public
24 SIERRA PACIFIC INDUSTRIES

 To take into account “the permit applicant’s interest (or someone else’s

14

interest) in using the hearing to explore issues further,” 45 Fed. Reg. at 33,409, EPA did,

however, add the discretionary authority to hold hearings to “clarify one or more issues.”

40 C.F.R. § 124.12(a)(2).

hearing is to respond to public interest, which is not subject to precise

measurement.” 45 Fed. Reg. 33,290, 33,409 (May 19, 1980). Later 14

repromulgations of this standard provide more definition. In 1984, in

amendments to its regulations governing state programs administering

section 404 of the Clean Water Act, EPA explained that under the

“significant degree of public interest” standard, “[i]f the issues sought

to be raised are immaterial, the [permit issuer] may conclude that the

degree of public interest is not ‘significant.’” 49 Fed. Reg. 39,012,

39,015 (Oct. 2, 1984) (“404 Program Regulation”). Five years later, in

explaining its choice of the “significant degree of public interest”

standard in the NPDES Sewage Sludge Permit Regulations, EPA

noted that EPA “strongly encourages public hearings whenever public

interest has been shown.” 54 Fed. Reg. 18,716, 18,776 (May 2, 1989).

Nonetheless, EPA made clear it disfavored “automatic triggers,” such

as a “single request,” and preferred “to give the Regional

Administrator flexibility to exercise judgment in this regard.” Id. 

b. Interpretations of the “Significant Degree of

Public Interest” Standard by the EPA

Administrator and the Board

Prior decisions by the EPA Administrator and the Board

recognize that the permit issuer has a degree of discretion in

determining whether to hold a hearing under section 124.12(a)(1)’s

“significant degree of public interest” standard. For example, in In re

Noranda Alumina, LLC, the Administrator recently opined that “the

EPA has recognized some discretion in the permitting authority to not

hold a public hearing for every PSD permit proceeding.” Title V Pet.

No. VI-2011-04, at 24 (Adm’r Dec. 14, 2012) (Order Denying Petition

for Objection to Permit). Other cases have described the

determination as to whether to hold a public hearing as “largely

discretionary.” In re City of Fort Worth, 6 E.A.D. 392, 407 (EAB

1996) (“The decision to hold a public hearing under
SIERRA PACIFIC INDUSTRIES 25

40 C.F.R.§ 124.12(a) is ‘largely discretionary.’” (quoting In re Avery

Lake Prop. Owners Assoc., 4 E.A.D. 251, 252 (EAB 1992))); see In re

Weber #4-8, 11 E.A.D. 241, 246 (EAB 2003) (Agency is afforded

“broad discretion” in deciding whether to hold a public hearing).

Taking into account the discretion accorded permit issuers on

the finding of whether there is a “significant degree of public interest”

in the draft permit, the Administrator and the Board generally have

upheld decisions by permit issuers to deny requests for public

hearings. Two of these cases concerned a PSD permit, Noranda and

In re Spokane Regional Waste-to-Energy Project, 3 E.A.D. 68 (Adm’r

1990). In Noranda, a petition had been filed with EPA requesting that

the Administrator object to a Title V permit granted by the State of

Louisiana that included a modification to an existing PSD permit. One

of the reasons the petitioners claimed the permit was objectionable

was that Louisiana had denied their request for a public hearing.

Because this was a state-issued permit, 40 C.F.R. § 124.12(a) did not

govern Louisiana’s decision on the hearing request; however,

Louisiana applied a “significant degree of public interest” test in

determining whether to grant a public hearing under its regulations

implementing the PSD requirements. The Administrator upheld

Louisiana’s denial of two public hearing requests under this standard,

focusing primarily on the insignificance of the PSD permit

modification. Title V Pet. No. VI-2001-04, at 25-26. Specifically, the

Administrator concluded that it was not “unreasonable” to deny a

hearing given that:

[T]he 2011 PSD permit was a revision of a previously

issued PSD permit and not an authorization for a

major modification of the source. Furthermore, based

on the stack tests, the maximum allowable NO[x]

emissions from the five emissions units tested

decreased, while increases in NO[x] emissions due to

the Yield Improvement Project were only 23.33 tpy

NO[x].

Id. at 26.
26 SIERRA PACIFIC INDUSTRIES

 This case involved application of 40 C.F.R. § 147.2929(f), which contains 15

identical language to 40 C.F.R. § 124.12(a)(1).

 In the Spokane decision, the Administrator upheld a hearing

denial emphasizing both the narrowness of the matter at issue and the

failure of the hearing requestors to address that narrow issue. There,

the Administrator reviewed the Washington State Department of

Ecology’s (“WSDE”) denial of a public hearing on WSDE’s proposed

revisions to a PSD permit. The Administrator previously had

remanded the permit to WSDE specifically for a determination of the

x

appropriate nitrogen oxide (“NO ”) limitation for the permitted

facility’s control technology. In denying a hearing request of its

x

revisions to the NO limitation, WSDE acknowledged that there was

public interest in the permit but “found there was little expression of

interest in the specific issue raised by the remand.” Spokane, 3 E.A.D.

at 69. The Administrator found these facts to be critical and upheld

WSDE’s denial of a public hearing because “the scope of the permit

revision was narrow” and there was no significant public interest in the

subject of the revision. Id. at 70. Another factor that appeared to play

a role in the Administrator’s decision was that although a public

hearing fulfilling all the requirements of 40 C.F.R. § 124.12 was not

held, the WSDE did actually meet with interested parties concerning

the permit revision. Id. at 69 & n.1. 

The Board also has upheld hearing denials in several cases

involving NPDES or UIC permits. Invariably, these cases involved a

single hearing request and, in most cases, no more than two public

comments. In re City of Attleboro, NPDES Appeal No. 08-08, slip op.

at 90-91 (EAB Sept. 15, 2009), 14 E.A.D. ___ (one hearing request,

“limited comments”); In re Sunoco Partners Mktg. & Terminals, LP,

UIC Appeal No. 05-01, at 13 (EAB June 1, 2006) (one hearing

request, two public comments); Fort Worth, 6 E.A.D. at 407 (one

hearing request, no other public comments); In re Osage (Pawhuska,

Okla.), 4 E.A.D. 395, 399 (one hearing request, one adverse public

comment); see also In re Core Energy, LLC, UIC Appeal No. 07-02, 15

slip op. at 7 n.7 (Dec. 19, 2007) (noting in dicta that Board sees no

error in denial of public hearing in UIC permit proceeding where there

was a single hearing request and only one adverse comment).
SIERRA PACIFIC INDUSTRIES 27

c. The PSD Statutory Public Participation

Requirements and the “Significant Degree of

Public Interest” Standard

An additional potential reference point for interpreting

40 C.F.R. § 124.12(a) is the CAA, particularly the portion establishing

the Prevention of Significant Deterioration of Air Quality program,

42 U.S.C. §§ 7470-7479. Just as a regulation must be consistent with

the underlying statute to be upheld, interpretation of the regulation

must be faithful to the statutory text. See United States v. Larionoff,

431 U.S. 864, 873 (1977) (“[R]egulations, in order to be valid, must be

consistent with the statute under which they are promulgated.”). Thus,

courts have emphasized that “a regulation must be interpreted so as to

harmonize with and further and not to conflict with the objective of the

statute it implements.’” Emery Mining Corp. v. Sec’y of Labor,

744 F.2d 1411, 1414 (10th Cir. 1984) (quoting Trustees of Ind. Univ.

v. United States, 618 F.2d 736, 739 (Ct. Cl. 1980)); accord

Carmichael v. The Payment Ctr., Inc., 336 F.3d 636, 640 (7th Cir.

2003) (“A statute and its implementing regulations should be read as a

whole and, where possible, afforded a harmonious interpretation.”);

Powell v. Heckler, 789 F.2d 176, 179 (3rd Cir. 1986) (“[S]tatutes and

regulations should be read and construed as a whole and, wherever

possible, given a harmonious, comprehensive meaning.”). But see

Envtl. Def. v. Duke Energy Corp., 549 U.S. 561, 573 (2007)

(observing that the obligation to construe a regulation consistent with

its authorizing statute does not confer the power to rewrite the

regulation). In fact, the Board previously has relied on public

participation provisions in the CAA to guide its application of the

procedural requirements in 40 C.F.R. part 124 to PSD permit

proceedings. In re RockGen Energy Ctr., 8 E.A.D. 536, 557 (EAB

1999) (“The failure of [a permit issuer] to comply fully with the public

participation requirements of the regulations implementing this

statutory requirement * * * undermines the statutory objective and

should be rectified.”).

The PSD program not only provides a broad instruction

regarding public participation in permit decisions, but specifically

addresses public hearings. The importance of adequate public

participation is emphasized in one of the five enumerated purposes of
28 SIERRA PACIFIC INDUSTRIES

the PSD program in section 160. 42 U.S.C. §7470. That purpose

statement reads:

[T]o assure that any decision to permit increased air

pollution in any area to which this section applies is

made only after careful evaluation of all consequences

of such a decision and after adequate procedural

opportunities for informed public participation in the

decisionmaking process.

42 U.S.C. § 7470(5). As to public hearings on permits, section 165

bars construction on major emitting facilities unless:

(1) a permit has been issued for such proposed facility

* * *; [and] (2) the proposed permit has been subject

to a review in accordance with this section * * * and a

public hearing has been held with opportunity for

interested persons including representatives of the

Administrator to appear and submit written or oral

presentations on the air quality impact of such source,

alternatives thereto, control technology requirements,

and other appropriate considerations.

Id. § 7475(a). The public hearing is well-integrated into the PSD

permit process with requirements for the collection of monitoring data

being coordinated with the timing of the public hearing on the permit.

See id. § 7475(e)(2) (requiring results of air quality monitoring data

and analysis to be “available at the time of the public hearing”); id.

§ 7475(e)(3)(C) (same).

Because the Region did not address the relevance of

sections 160 and 165 to the interpretation of 40 C.F.R. § 124.12(a)(1)

in its Response to the Petitions, the Board requested supplemental

briefing on the issue. In response, the Region, in conjunction with

EPA’s Office of General Counsel, Office of Air and Radiation, and

Office of Environmental Justice, argues that these provisions should

not be relied upon “to establish a reading of section 124.12 that is

unique to PSD permits.” Reg. 9 Suppl. Br. at 17. The Region

explains that EPA, in promulgating 40 C.F.R. § 124.12, had
SIERRA PACIFIC INDUSTRIES 29

interpreted sections 160 and 165 as requiring no more than “an

opportunity for a hearing,” and EPA had determined that the statutory

requirements of the PSD provisions did not require a PSD-specific

approach to the “significant degree of public interest” standard for

instances in which section 124.12(a) was applied to PSD permits. Id.

at 18. According to the Region, “[t]here is no indication that EPA

intended to apply different interpretations of the same language in

section 124.12(a)(1) under different statutory contexts and different

permitting programs.” Id. at 18-19. Further, the Region argues that

appeal of a permit decision is not the appropriate venue for

reconsideration of a prior rulemaking. Id. at 17-18.

Sierra Pacific’s supplemental response largely tracks the

arguments made in the Region’s brief. Sierra Pacific Reply to Reg. 9

Suppl. Br. at 1-4. In addition, Sierra Pacific emphasizes that

reconsidering section 124.12(a)’s validity is inappropriate because it

would delay a project that has positive environmental and economic

benefits. Id. at 5-6. Ms. Draisner, in her response, disputes the

Region’s and Sierra Pacific’s claims that it is not appropriate to

evaluate whether the “significant degree of public interest” standard is

consistent with the CAA. Draisner Reply to Sierra Pacific Reply to

Reg. 9 Suppl. Br. at 1. In her response to the Region’s Supplemental

Brief, Ms. Draisner asks: “If permit proceedings before the Board are

not the place for a challenge to an unlawfully promulgated regulatory

standard, then which environmental court would be the correct one?”

Id. As to Sierra Pacific’s concern with delays in the PSD permitting

process for its proposed cogeneration boiler, Ms. Draisner asserts the

fault for that delay lies with the Region and does not justify denying

the public’s right to a public hearing. Id. at 2. Finally, Ms. Draisner

also argues that the history of Shasta County’s preparation of its EIR

shows there was a significant degree of public interest. Id. Ms. Strand

uses her supplemental response to reiterate her claims regarding Shasta

County as an environmental justice community and to dispute the

adequacy of the notice the Region provided on the draft permit.

Strand Resp. to Reg. 9 Suppl. Br. at 1-2.

The Board generally will not entertain a challenge to the

validity of a regulation in a permit appeal. In re City of Irving,

10 E.A.D. 111, 123-25 (EAB 2001), review denied sub nom. City of
30 SIERRA PACIFIC INDUSTRIES

Abilene v. EPA, 325 F.23 657 (5th Cir. 2003); In re Tondu Energy Co.,

9 E.A.D. 710, 715-16 (EAB 2001). In fact, the “presumption of

nonreviewability in the administrative context is especially appropriate

when Congress * * * has set precise limits on the availability of a

judicial forum for challenging particular kinds of regulations.” In re

Woodkiln, Inc., 7 E.A.D. 254, 269 (EAB 1997) (citing In re

Echevarria, 5 E.A.D. 626, 634-35 (EAB 1994)). In this instance,

section 307(b) of the CAA expressly limited challenges to this

regulation to within sixty days of promulgation, 42 U.S.C. § 7607(b),

which was decades ago. As the Board has made clear, “[o]nce [a] rule

is no longer subject to court challenge by reason of the statutory

preclusive review provision, the Agency is entitled to close the book

on the rule insofar as its validity is concerned.” Echevarria, 5 E.A.D.

at 635. The Board only will entertain a challenge to a regulation

subject to a preclusive judicial review provision in “exceptional”

circumstances where an “extremely compelling argument” is made in

support of review. In re USGen New Eng., Inc. Brayton Point Station,

11 E.A.D. 525, 557 (EAB 2004). The only circumstance identified by

the Board to date as possibly meriting the extraordinary step of

entertaining a challenge to a regulation precluded from judicial review

is if the regulation “has been effectively invalidated by a court but has

yet to be formally repealed by the Agency.” Id.

As discussed in Part VII.A.2.g below, the Board has

concluded that the Region clearly erred under the plain language of

40 C.F.R. § 124.12(a)(1) – the regulation implementing CAA

sections 160(5) and 165(a)(2) – in denying the requested public

hearing. Because the Board is ordering the Region to hold a public

hearing consistent with the regulation, there is no reason for the Board

to address Ms. Draisner’s request that the Board examine whether the

regulation itself is consistent with the CAA, particularly given the

preclusive judicial review provision in 42 U.S.C. § 7607(b). Further,

given that no party advocates that the CAA provisions support even

greater discretion for the permit issuer in denying a hearing, the Board

has determined it need not resolve in this case whether the PSD

statutory public participation provisions provide a gloss on the

interpretation of the “significant degree of public interest” test in the

context of PSD permit proceedings.
SIERRA PACIFIC INDUSTRIES 31

 Mr. Coleman also cites Executive Order 13,563, 76 Fed. Reg. 3821 (Jan. 21, 16

2011), which addresses, among other things, public participation in rulemaking. Because

this case involves a permit proceeding and not a rulemaking, that Executive Order is

inapposite.

d. Environmental Justice and the “Significant

Degree of Public Interest” Standard

Three of the Petitioners cite the President’s Executive Order

on Environmental Justice and EPA policies on this subject as

supporting their request for a public hearing. Although Ms. Strand 16

and Ms. Draisner do not explain what role environmental justice

precepts should have under the regulatory requirements pertaining to

hearing requests on permits, Mr. Coleman appears to argue that these

orders and guidelines lower the standard for granting a public hearing

under 40 C.F.R. § 124.12(a)(1). Coleman Pet. at 3. The Board

disagrees.

Executive Order 12,898, entitled “Federal Actions to Address

Environmental Justice in Minority and Low-Income Populations,” is a

directive to each federal agency to “make achieving environmental

justice part of its mission by identifying and addressing, as

appropriate, disproportionately high and adverse human health or

environmental effects of its programs, policies, and activities on

minority populations and low-income populations.” Exec.

Order 12,898 § 1-101, 59 Fed. Reg. 7629 (Feb. 16, 1994). To

implement the Executive Order, EPA has issued policy statements

such as “Plan EJ 2014,” U.S. EPA, Plan EJ 2014 (Sept. 2011)

( avail abl e a t http ://w w w . epa. gov/ envir o n m ent a ljusti ce/

resources/policy/plan-ej-2014/plan-ej-2011-09.pdf), and “EPA

Activities to Promote Environmental Justice in the Permit Application

Process,” 78 Fed. Reg. 27,220 (May 9, 2013).

Neither the Executive Order nor EPA policy statements,

however, amend EPA’s statutory or regulatory requirements and

obligations. The Executive Order emphasizes that all of its directives

to agencies are to be implemented “[t]o the greatest extent practicable

and permitted by law.” Exec. Order 12,898 § 1-101. Further, the
32 SIERRA PACIFIC INDUSTRIES

 The Board addresses the applicability of Executive Order 12,898 to the 17

Region’s determination of when to hold a public hearing under 40 C.F.R. § 124.12(a)(1)

and (a)(2) in Parts VII.A.2.g and VII.B below, respectively.

Order concludes by stating that “[t]his order is intended only to

improve the internal management of the executive branch and is not

intended to, nor does it create any right, benefit, or trust responsibility,

substantive or procedural, enforceable at law or equity by a party

against the United States, its agencies, its officers, or any person.” Id.

§ 6-609. EPA also recently explained that its environmental justice

policies are discretionary actions that do not amend substantive law:

EPA [policies] are not an interpretation of

environmental statutes, nor do they add to or change

interpretations of statutory obligations regarding

permitting contained in existing regulations. They

create no legal obligations and in no way change the

legal landscape of the EPA permitting process. To the

contrary, the only legal requirements applicable to

EPA regional offices and permit applicants throughout

the permitting process are those contained in the

EPA’s environmental statutes, implementing

regulations, the Administrative Procedure Act,

applicable anti-discrimination laws and other

applicable statutes and regulations.

78 Fed. Reg. at 27,221. Further, EPA has noted that its “ability to

perform outreach [to promote environmental justice] is constrained by

its resources.” Id. Accordingly, the Board does not agree with

Mr. Coleman’s assertion that the Executive Order and EPA

environmental justice policies amend the standard for granting a public

hearing under 40 C.F.R. § 124.12(a)(1).17
SIERRA PACIFIC INDUSTRIES 33

e. The Region’s Contentions as to the Meaning of

the “Significant Degree of Public Interest”

Standard

The Region contends that the “significant degree of public

interest” standard requires a “qualitative judgment” taking into

consideration “multiple factors,” including the number of hearing

requests, the number of comments, media reports on the project, and

other information that indicates the level of public interest. Reg. 9

Suppl. Br. at 19-20. These other factors, the Region states, include

“considerations of environmental justice, demographic and

socioeconomic information, as well as additional factors, including

those raised by stakeholders, that indicate whether there is significant

interest in a PSD permitting decision within potentially affected

communities.” Id. at 20. More specifically, the Region indicates that

it has considered, in appropriate instances, “public participation and

engagement in the area regarding air/environmental issues, interest in

local public meeting and/or publications regarding to the proposed

project, socioeconomic status, linguistic isolation, education levels,

minority population, and other factors as a particular case may

warrant.” Id. at 12-13. The Region emphasizes that “[n]o one factor

is dispositive, and there is no exclusive list of factors that can or must

be considered.” Id. at 20. In particular, the Region makes clear that

the decision “should not be based simply on the number of requests for

hearing received or any other mechanical criteria.” Id.

f. Relevant Considerations

The Board agrees with the Region that the “significant degree

of public interest” standard “suggests that more than any public

interest at all is needed to trigger a mandatory requirement to hold a

permit hearing on a PSD permit application,” and that there is “no

‘bright line’ test” for defining” this standard. Reg. 9 Suppl. Br. at 19.

The Board further agrees with the Region that multiple factors should

be considered in determining if there is a significant degree of public

interest in a draft permit. The Region, with the concurrence of the

Office of General Counsel, the Office of Air and Radiation, and the

Office of Environmental Justice, has identified in its Supplemental

Brief many appropriate factors for consideration. Other considerations
34 SIERRA PACIFIC INDUSTRIES

are discussed in prior Board and Administrator decisions and EPA

rulemakings. Relevant considerations include:

Materiality of Issues. Both EPA’s interpretative statements in

the preamble to the 404 Permit Regulation and the Spokane decision

indicate that if requestors raise only immaterial issues, they have not

demonstrated a significant degree of public interest in the draft permit.

By implication, a requestor that identifies material issues to be raised

at a public hearing has provided an indication that there is a significant

degree of interest in the draft permit. Thus, the materiality or

relevance of the issues identified for the hearing is a key consideration

in determining if a hearing is required. 

Number of Hearing Requests and Comments. Although

gauging the degree of public interest is not simply a numbers game,

consideration of the number of hearing requests and comments

obviously is relevant. The Board frequently has upheld the denial of

public hearing requests where there has been a single hearing request

and only one or two comments. However, the quantitative exercise of

counting hearing requests and comments cannot be separated from the

qualitative examination of the substance of the requests and

comments. Further, it is also important to evaluate the number of

requests and comments in the context of the size of the affected

community.

Degree of Public Interest in Related State or Local

Proceedings. The Region in its Supplemental Brief proposes that

“public participation and engagement in the area regarding

air/environmental issues [and] interest in local public meeting and/or

publications regarding the proposed project” are relevant when

assessing the degree of public interest. Reg. 9 Suppl. Br. at 12-13.

Similarly, in its Response to the Petitions for Review, Sierra Pacific

argues that the Board should consider the public interest in its

proposed cogeneration unit by examining public participation in

proceedings conducted by Shasta County under California law on the

proposed unit. Sierra Pacific Resp. at 7. The Board agrees that where

state and local proceedings involve related issues, they may provide

relevant information concerning the degree of public interest in the

draft federal permit. 
SIERRA PACIFIC INDUSTRIES 35

 As a general matter, public meetings are more informal gatherings than 18

nonadjudicatory public hearings. Part 25 of Title 40 of the Code of Federal Regulations

describes the way a “public meeting” differs from a “public hearing,” for the purposes

of public participation requirements in CWA, SDWA, and RCRA administrative

proceedings, as that public meetings “do not require formal presentations, scheduling of

presentations and a record of proceedings.” 40 C.F.R. § 25.6.

Media Reports. The Region has suggested that media

coverage of a project that is the subject of a draft permit is an

appropriate consideration in measuring the degree of public interest.

Reg. 9 Suppl. Br. at 20. The Board agrees that this is a factor that can

be given some weight in examining the importance or significance of

the issue to the affected community.

Significance of the Permit Action. In the Noranda decision,

the Administrator relied on the minor nature of the permit

modification as weighing against a determination that there was a

significant degree of public interest in a draft permit. In Spokane, the

narrowness of the issue involved in the remanded permit proceeding

played a similar role. Conversely, new permits or major modifications

to existing permits may carry the opposite implication.

Substitute Process Provided. The provision of a substitute for

a “full-dress” public hearing may act to satisfy public interest in a draft

permit and thus make that interest less significant for purposes of

deciding whether to hold a hearing. This factor was cited by the

Administrator in Spokane (the Region held a public “meeting” rather

than a public “hearing”) and the Board in Osage (the Region met in 18

person with the hearing requestor and allowed the requestor to make

oral comments for the record).

Demographic Information. The Region argues that

environmental justice considerations, and demographic and

socioeconomic information, are important factors to consider when

determining whether to grant a hearing under 40 C.F.R.

§ 124.12(a)(1). Petitioners similarly argue that permitting authorities

should consider environmental justice when deciding whether to hold

a public hearing. The Board agrees that, when applicable, these are

factors that permitting authorities should consider when determining
36 SIERRA PACIFIC INDUSTRIES

the degree of public interest in a given permit proceeding. Further, as

the Board makes clear in Part VII.B below, environmental justice

considerations also are plainly relevant to a permit issuer’s decision as

to whether to exercise its discretion to hold a public hearing under

40 C.F.R. § 124.12(a)(2).

g. The Degree of Public Interest in the Draft Sierra

Pacific Permit

As stated above, the decision whether to hold a public hearing

to “clarify one or more issues involved in the permit decision” is

within the permit issuer’s discretion, 40 C.F.R. § 124.12(a)(2);

however, the permit issuer must hold a hearing whenever there is a

“significant degree of public interest” in the draft permit, id.

§ 124.12(a)(1). Even so, a permit issuer has “some discretion” in

making the factual finding of whether the standard mandating a

hearing under section 124.12(a)(1) has been met. That discretion,

however, is not limitless. Even where the Board has granted a permit

issuer broad discretion in resolving factual issues, the Board has

placed limits on that discretion. See In re Russell City Energy Ctr.,

LLC, PSD Appeal Nos. 10-01 to 10-05, slip op. at 97 (Nov. 18, 2010),

15 E.A.D. ___ (noting that although “the permit issuer has broad

discretion in determining whether a control option would redefine the

source, * * * [s]uch discretion * * * is not unlimited”); In re Haw.

Elec. Light Co., 8 E.A.D. 66, 98 (EAB 1998) (“Generally, the choice

of appropriate data sets for the air quality analysis is an issue largely

left to the discretion of the permitting authority. * * * However, that

discretion is not unlimited.”) (citation omitted). The Board has

reviewed the Region’s discretionary determination regarding the

degree of public interest in the draft Sierra Pacific permit under the

factors suggested in the Region’s Supplemental Response, Agency

rulemakings, and prior decisions by the EPA Administrator and the

Board. That review leads the Board to two conclusions: first, the

Region did not follow such a multifactor approach in denying the

hearing requests in this case; and second, the Region abused its

discretion in determining that there was not a significant degree of

public interest in the Sierra Pacific draft permit.
SIERRA PACIFIC INDUSTRIES 37

 In the same section of the Response to Comments document, the Region 19

mentioned that it examined demographic data on Shasta County. RTC at 10. However,

this discussion came in response to a comment that the Region was “violating the intent

of Executive Order #12,898 with regard to Environmental Justice by circumventing the

entire PSD permitting process,” id. at 9, and the Region’s discussion of the demographic

data was directed at justifying the Region’s determination “that outreach materials would

not be translated into another language,” id. at 10. 

 To the extent the Region’s Response suggests that a public hearing can be 20

denied “[b]ecause Region 9 could provide a detailed and thorough response to all public

comments,” Reg. 9 Resp. at 10, the Board must disagree. If that was an appropriate

consideration, it is difficult to imagine when the permit issuer could not use such a factor

to deny a public hearing. The Region is obligated to provide a response to comments by

(continued...)

Notwithstanding the Region’s statements in its Supplemental

Brief that there is no “bright line” for defining the “significant degree

of public interest” standard, and that application of this standard

“should not be based simply on the number of requests for hearing

received,” Reg. 9 Suppl. Br. at 19-20, the Region appears to have

followed precisely that approach. In the Response to Comments

document, the Region simply cited to the hundreds of persons notified

of the draft permit, related that it had received three hearing requests

and fifteen comments, and then concluded that “[n]one of the requests

for a public hearing demonstrated that there was a significant degree of

public interest in the project” as the justification for its decision not to

hold a public hearing. RTC at 10. The Region followed a similar 19

approach in its Response to the Petitions for Review. There, the

Region noted that it “disseminated the public notice for our proposed

action to over 800 groups and individuals using U.S. mail and to

approximately 650 individuals and groups using electronic mail; we

also published notices in the local paper, the Record Searchlight, and

on the Region 9 Web site.” Reg. 9 Resp. at 8. The Region then

contrasted these numbers with the numbers of hearing requests

(requests from three individuals, one of whom represented a group)

and comments (twelve adverse comments) and concluded “we

received very little indication that the public at large was interested in

this permit decision.” Id. The Board agrees with the Region’s

position in its Supplemental Response that a more nuanced and

multifactored approach is necessary.20
38 SIERRA PACIFIC INDUSTRIES

(...continued) 20

regulation, irrespective of whether the comments are received orally or in writing. See

40 C.F.R. § 124.17(a)(2).

The Board’s examination of the factors relevant to assessing

the degree of public interest in the Sierra Pacific draft permit satisfy

the Board that the public interest was significant. First, each of the

requests raised issues that were material to the permit proceeding.

Mr. Simpson supplied comments in some detail in his hearing request

addressing the question of BACT. Reg. 9 Resp. attach. 2, app. B, at 3

(E-mail from Rob Simpson to Reg. 9 Air Permits Docket (Oct. 17,

2012)). Although the issues described in Ms. Lawrence’s and

Ms. Strand’s hearing requests were more broadly framed, they clearly

raised concerns regarding the cumulative air quality impacts of the

Sierra Pacific facility, suggested alternatives to a cogeneration facility,

and argued for consideration of environmental justice issues. See

Reg. 9 Resp. attach. 1, exc. 9 & attach. 2, app. A. Thus, each of the

hearing requests put forward issues well within the considerations the

statute has denoted as appropriate for a PSD public hearing – namely,

“the air quality impact of such source, alternatives thereto, control

technology requirements, and other appropriate considerations.”

42 U.S.C. § 7475(a)(2). The Region’s Response and Supplemental

Response concede this issue. Reg. 9 Suppl. Br. at 15; Reg. 9 Resp.

at 9-10. Where, as here, there are several hearing requests, each

raising issues the statute has defined as material to the hearing, the

Region has an obligation to consider them as a factor in deciding that

there may be a significant degree of public interest, not just

determining that commenters can submit those concerns in writing in

lieu of having a public hearing under 40 C.F.R. § 124.12(a)(1).

Second, although the number of hearing requests was not

overwhelming, neither was it insubstantial. Here, as noted above, each

of the individuals filing hearing requests identified issues relevant to

the draft permit. One of the requestors, Mr. Simpson, raised issues in

some detail. Another requestor, Ms. Strand, was particularly insistent.

Ms. Strand did not merely file one hearing request, she filed three.

When the Region indicated it was not inclined to grant her requests,

Ms. Strand would not take “no” for an answer and challenged the
SIERRA PACIFIC INDUSTRIES 39

 For comparison, Los Angeles County and San Diego County, two more 21

urban/suburban California counties of roughly comparable area to Shasta County, have

populations of 9,818,000 and 3,095,000, respectively. U.S. Census Bureau, State and

County Quick Facts (June 6, 2013). The population per square mile for Los Angeles

County, San Diego County, and Shasta County is 2,419.6, 735.8, and 46.9, respectively.

(continued...)

Region to explain the basis for its denial. Further, the Region’s

preliminary denial of Ms. Strand’s hearing request led CCA, an

organization to which Ms. Strand and two of the other Petitioners

belong, to immediately petition the Board for review of that “denial.”

Finally, given that Ms. Strand had signed her requests as the co-chair

of CCA and CCA had challenged the Region’s denial of Ms. Strand’s

hearing request, it would be unfair to characterize Ms. Strand’s

hearing request as only representing a single individual. Collectively,

these circumstances strike the Board as distinctly different than the

several instances in which the Board has upheld a hearing denial in the

face of a single hearing request. See Attleboro, slip op. at 90-91,

14 E.A.D. at ___ (one hearing request); Sunoco, UIC Appeal No. 05-

01, at 13 (one hearing request); City of Fort Worth, 6 E.A.D. at 407

(one hearing request); Osage, 4 E.A.D. at 399 (one hearing request).

Turning to the number of public comments, the distinction

between the present case and prior decisions upholding hearing denials

becomes even more clear. The Region received fifteen comments on

the Sierra Pacific draft permit, twelve of which were adverse. In

comparison, in the prior permit cases in which the Administrator or the

Board upheld hearing denials, there generally were only one or two

public comments filed. See Sunoco, UIC Appeal No. 05-01, at 13

(two public comments); City of Fort Worth, 6 E.A.D. at 407 (one

public comment); Osage, 4 E.A.D. at 399 (one adverse public

comment); see also Attleboro, slip op. at 90-91, 14 E.A.D. at ___

(“limited comments”). Moreover, it is important to not just focus on

the raw numbers. Context is relevant. The Sierra Pacific facility is not

located in a major urban or suburban area. The City of Anderson has a

population of approximately 10,000. U.S. Census Bureau, State and

County Quick Facts (June 6, 2013). Shasta County itself is relatively

sparsely settled, having a population of approximately 177,000 spread

over nearly four million square miles. Id. The Region, however, 21
40 SIERRA PACIFIC INDUSTRIES

(...continued) 21

Id.

 In its Supplemental Response, the Region describes the number of notices 22

that went to residents of Shasta County as “many.” Reg. 9 Suppl. Resp. at 13. No

citation to the record is provided to support this assertion.

failed to provide any metric to evaluate the level of the response to the

Sierra Pacific draft permit, such as examples of the level of the public

response seen in other communities of comparable size when

presented with a notice of draft PSD permits. Instead, the Region

simply compared the number of responses to the permit notice (fifteen

comments including three hearing requests) to the number of notices

sent (over 1,000). Even as to these numbers, the Region presented no

comparative analysis data to support its conclusion that this response

rate was insignificant. 

Additionally, the Board finds this comparison of limited value

because the Region did not identify, with any specificity, the

geographic distribution of the notices. The Region’s Response merely

states that the notices were mailed and e-mailed to “agencies,

organizations, and public members for whom contact information was

obtained through a number of different methods, including requests

made directly to EPA through Region 9’s website (or through other

means) from parties seeking notification regarding permit actions in

California, within the SCAQMD, and other parties known to EPA that

may have an interest in this action.” Reg. 9 Resp. at 3. Given that

parties receiving notices included not just individuals in the most

directly affected community, but also persons throughout California

who have expressed interest in PSD permits, it is possible that the

majority of these notices went to individuals or organizations outside

of Shasta County. 

22

In sum, absent some contextual analysis of the response rate to

the Sierra Pacific draft permit notice, it is hard for the Board to

determine what basis the Region had for its conclusion that “we

received very little indication that the public at large was interested in

this permit decision.” Reg. 9 Resp. at 8. Notably, as discussed below,

Shasta County reached precisely the opposite conclusion on the degree
SIERRA PACIFIC INDUSTRIES 41

 The Region claims in its Supplemental Response that it consulted with the 23

SCAQMD “about the level of public interest.” The Region, however, has not cited to any

documentation of this consultation in the administrative record nor provided any

information regarding what was learned. 

of public interest in the Sierra Pacific project in its EIR proceeding,

where it received a similar number of comments. 

Third, the level of public participation in local proceedings on

the Sierra Pacific project indicates that the degree of public interest in

the project was significant. Pursuant to the CEQA, the Shasta County

Department of Resource Management (“SCDRM”) prepared an EIR

on the proposed Sierra Pacific cogeneration unit. The public

participation process for production of the EIR involved circulation of

a draft EIR for comment on August 6, 2010, two subsequent

circulations of a revised draft EIR in response to public comments and

new information pertaining to the potential greenhouse gas impacts of

the project, and release of the final EIR in May 2012. The SCDRM

received fourteen comments on the first draft report and four

additional comments on each of the recirculated draft EIRs. In total,

the SCDRM received comments from sixteen different parties (three

of the commenters commented on each of the drafts). In its final EIR,

the SCDRM explained that it had released a revised EIR for comment

(the first revised EIR) because of “the relatively high public interest in

the [greenhouse gas] topic.” Final EIR § 1.0-3. In other words, the

SCDRM concluded that fourteen public comments on the Sierra

Pacific project showed “relatively high public interest.” Id.

23

Although the Region is charged with making its own assessment as to

the degree of public interest under section 124.12(a)(1), the Region

fails to explain why it reached a different conclusion than the SCDRM

when faced with a similar number of commenters.

Sierra Pacific argues that “the administrative record shows

there was little public interest in the Project throughout the permitting

process, including during the CEQA review.” Sierra Pacific Resp.

at 7. As support, Sierra Pacific cites to a June 15, 2012 e-mail that a

Sierra Pacific executive sent to the Region describing a public hearing
42 SIERRA PACIFIC INDUSTRIES

before the Shasta County Planning Commission on the Final EIR.

That e-mail reads:

The SPI Anderson EIR and Special Use Permit was

approved at the Planning Commission yesterday with

a 4-0 vote. The audience had two citizens that spoke

against the project and had received two letters prior

to the meeting: one from [the Center for Biological

Diversity (“CBD”)], another from Caltrans [State of

California, Department of Transportation]. One of the

citizens was suggesting that the project look into solar

“cones” as the latest nano-technology for energy

production; the other citizen was concerned that the

project showed 330,000 tons of [carbon dioxide] left

unmitigated and compared this to 63,000 cars. I’ll

forward the CBD letter – it was primarily focused and

reiterated the same prior comments on [greenhouse

gases] and carbon neutrality towards biomass.

Overall, it was very positive with the local support on

the project and lack of attendees. * * *

As this relates to the PSD permit, having no public

meeting still looks appropriate and we should focus on

completing the draft of the permit * * *.

E-mail from David C. Brown, Envtl. Affairs & Compliance Mgr.,

Sierra Pac. Indus., to Omer Shalev & Gerardo Rios, EPA Reg. 9

(June 15, 2012) (Admin. Rec. I.32). Sierra Pacific argues that the fact

that there were only two speakers at the hearing (neither of whom are

petitioners in this appeal) and two opposition letters received

demonstrates a lack of significant public interest. Sierra Pacific Resp.

at 6. In the Board’s view, this evidence shows the contrary. It

demonstrates that, even prior to the initiation of the Region’s public

participation procedures on the federal permit, citizens attending a

public hearing, a public interest group, and a state government agency

were raising issues – issues on air quality impacts and alternative

power technologies – that are relevant to a PSD permit hearing.

Further, while, as discussed below, it was up to the Region to make its
SIERRA PACIFIC INDUSTRIES 43

 Alayna Shulman, Activists Lose Bid to Stop Plant, Sierra Pacific Gets OK 24

from Shasta County, Rec. Searchlight (Redding, Cal.), July 18, 2012, at A001; Alayna

Shulman,Group Objects to New Power Plant, Sierra Pacific’s Burn Plan Contested, Rec.

Searchlight (Redding, Cal.), July 15, 2012, at B001; Damon Arthur, Power Plant Near

Anderson OK’d, Facility Would Emit 330,000 Tons of Gases, Report Says, Rec.

Searchlight (Redding, Cal.), June 15, 2012, at A001; Damon Arthur, Plant to Have Minor

Impact, New Report Calls Facility “Carbon Neutral,” Rec. Searchlight (Redding, Cal.),

Feb. 19, 2012, at A001.

 Editorial, When Convenient, Environmentalists Ignore the Long Run, Rec. 25

Searchlight (Redding, Cal.), July 18, 2012, at A006; Editorial, Renewable Power Isn’t

(continued...)

own independent judgment on the degree of public interest, the Board

places greater weight on SCDRM’s judgment on the degree of public

interest as expressed in its published EIR than on the judgment of the

permit applicant as expressed in an e-mail, which, on its face,

advocates a certain position (“having no public meeting still looks

appropriate”). 

Fourth, as suggested by the Region, the Board has evaluated

media reports on the project as an indicator of the degree of public

interest. Although the Region did not include any analysis of the

media coverage of the Sierra Pacific cogeneration unit, the Board can

take official notice of items appearing in the public press to show what

information is in the public realm. In re Stonehaven Energy Mgmt.,

LLC, UIC Appeal No. 12-02, slip op. at 18 n.11 (EAB Mar. 28, 2013),

15 E.A.D. ___; cf. Von Saher v. Norton Simon Museum of Art at

Pasadena, 578 F.3d 1016, 1022 (9th Cir. 2009) (“Courts may take

judicial notice of publications introduced to ‘indicate what was in the

public realm at the time, not whether the contents of those articles

were in fact true.’” (quoting Benak v. Alliance Capital Mgmt., LP,

435 F.3d 396, 401 n.15 (3d Cir. 2006))). A search of a commercial

database disclosed nearly a dozen articles in local papers about the

Sierra Pacific project in the months leading up to and following the

comment period. The Record Searchlight carried four news articles

chronicling the dispute over the CEQA review process for the Sierra

Pacific project before the Shasta County Supervisors and the Shasta

County Planning Board and three opinion pieces on the merits of the 24

project. In one instance, a Record Searchlight news article on the 25
44 SIERRA PACIFIC INDUSTRIES

(...continued) 25

Green Enough for Enviro Group, Rec. Searchlight (Redding, Cal.), June 14, 2012,

at A006; Editorial, Without Clarity, Greenhouse-Gas Crusade Is Futile, Rec. Searchlight

(Redding, Cal.), Feb. 23, 2012, at A004.

 Damon Arthur, Use Permit Approved for Anderson Cogeneration Plant,

26

Chico Enter.-Rec. (Cal.), June 15, 2012; Damon Arthur, Use Permit Approved for

Anderson Cogeneration Plant, Oroville Mercury Reg. (Cal.), June 15, 2012.

 Damon Arthur, Biomass Plant’s Environmental Benefits Up for Debate, Rec. 27

Searchlight (Redding, Cal.), Apr. 27, 2013; Damon Arthur, EPA Seeking Public

Comment on SPI Plant Near Anderson, Rec. Searchlight (Redding, Cal.), Sept. 22, 2012.

Sierra Pacific project was picked up by other newspapers in the region,

the Chico Enterprise-Record and the Oroville Mercury Register. The 26

Record Searchlight also published a news article on the Region’s

request for comments on the federal PSD permit and, on April 27,

2013, ran an article on biomass power plants that discussed the

proposed Sierra Pacific cogeneration boiler. This level of media 27

coverage suggests that, in fact, there was a fair amount of public

interest in the draft permit.

The fifth factor mentioned above is the significance of the

proposed action. Unlike in Noranda, the permit at issue here is not a

minor modification to the existing PSD permit resulting in little-to-no

change in emissions, but a major modification to a permit involving

construction of a new boiler. Similarly, inapposite to Spokane, the

permit review does not concern a single, narrow issue. Thus, there is

no reason to discount the degree of public interest due to the

insignificance of the action covered by the permit.

Finally, the Board considered whether the Region provided a

substitute opportunity to the hearing requestors to participate in the

proceeding as occurred in Spokane and Osage. The Region did

communicate by e-mail with Ms. Strand and Mr. Simpson. These

communications did serve a public participation purpose by providing

information relevant to some of their stated inquiries. However, for

two reasons, the Board concludes that these communications have, at

best, a marginal impact on determining the degree of public interest.
SIERRA PACIFIC INDUSTRIES 45

First, the interaction here falls far short of what occurred in

Spokane (public meeting) and Osage (face-to-face meeting with

hearing requestor in which the requestor was permitted to submit oral

comments for the record). Mr. Simpson’s questions were of a nonsubstantive nature (e.g., what is the contact information for the

applicant; what are the most relevant portions of the record to

consider) and thus the Region’s response to them cannot, in any way,

be described as providing a substitute process for an interested party to

have its views heard. With regard to the communications with Ms.

Strand, the Region did not provide a full response to the questions of

Ms. Strand that the Region did address; rather, it mainly directed her

to documents in the record. Although this interchange did permit

Ms. Strand to identify documents relevant to some of the questions she

had raised, the limited nature of the communications from the Region

makes it difficult to conclude that the communications provided a

substitute participation process qualitatively different than a standard

request for written comments. 

Second, and more important, the Region failed to respond to

Ms. Strand’s demand that the Region spell out how it would determine

whether the “significant degree of public interest” standard was met.

See Reg. 9 Resp. attach. 2, app. A, at 4 (“What are your agenc[y’]s

procedures for determining the threshold requirement to hold a public

hearing?”). Ms. Strand’s query was made early enough in the

comment period that a prompt response from the Region could have

made a difference in how Ms. Strand framed her subsequent requests.

Yet, instead of providing further information on how the Region

evaluated the degree of public interest in a hearing, the Region simply

referred Ms. Strand to the AAQIR on the draft permit and repeatedly

urged her to submit written comments. The AAQIR mentions the

regulatory test of “significant degree of public interest” but does not

further explain that standard. AAQIR at 46.

The Board concludes that this factor supports no greater than a

negligible reduction in characterization of the degree of public interest
46 SIERRA PACIFIC INDUSTRIES

 The Board also considered the parties’s contentions about the demographic 28

factors bearing on environmental justice. However, because none of the parties have

clearly articulated the manner in which such information should be relied upon in

determining whether any particular set of facts amounts to a significant degree of public

interest, the Board has given demographic information and environmental justice

considerations no weight in determiningwhetherthe Region erred in denying the hearing

requests in this case.

The Board also istroubled by variousstatements in the administrative record

29

that raise questions as to whether the Region approached the public hearing issue with

an open mind. In an e-mail sent months before the comment period opened on the draft

federal permit, a Sierra Pacific executive reports to the Region on the public hearing

before local governmental officials and states that “having no public meeting still looks

appropriate.” E-mail from David C. Brown, Envtl. Affairs & Compliance Mgr., Sierra

Pac. Indus., to Omer Shalev & Gerardo Rios, EPA Reg. 9 (June 15, 2012) (Admin.

Rec. I.32) (emphasis added). Viewed even in the best light, this highlighted phrase could

be construed as part of Sierra Pacific’s on-going suggestions to the Region that a public

hearing was not needed. Alternatively, the highlighted phrase could be read as

suggesting that the Region already had made this determination at least three months

before the public comment period opened on the draft permit – and before some citizens

had notice of the project – and communicated with Sierra Pacific at some point before

or after making this decision. Later, the Region responded to Ms. Strand’s request, early

in the comment period, for a public hearing by advising her that “EPA does not currently

(continued...)

in a hearing on the draft permit. Although the Board is willing to 28

consider the impact of forms of substitute process different than were

used in Spokane and Osage, the truncated and selective e-mail

communications in this case do not rise to the level of a substitute

means of public participation.

After weighing each of these factors, the Board holds that the

Region abused its discretion in determining the degree of public

interest. Most of the factors support the conclusion that there is a

significant degree of public interest in a public hearing and none of the

factors support the opposite conclusion in a meaningful manner. Most

influential in this weighing process is that three parties identified

multiple issues relevant to the PSD permit to be raised at a public

hearing, a total of fifteen comments were received on the draft permit

for a facility in a relatively sparsely populated county, and the local

government has described the public interest in the Sierra Pacific

project as “relatively high.”29
SIERRA PACIFIC INDUSTRIES 47

(...continued) 29

plan to hold a public hearing for this proposed action,” Reg. 9 Resp. attach. 2, app. A,

at 3, and pointedly ignored her request for an explanation of what threshold showing she

needed to make to obtain a hearing. This failure to respond to Ms. Strand’s request for

clarification is particularly glaring in light of Ms. Strand’s prompt attempt to rectify the

deficiency in her hearing request that the Region had identified (i.e., failure to specify a

list of issues for the hearing), and her insistent and repeated demands for a public hearing.

Rather than respond to Ms. Strand’s request for clarification on the threshold for

obtaining a hearing, the Region repeatedly urged her to submit written comments.

Although when viewed independently these statements may be of no moment, in

combination, they create the appearance that the Region had prejudged the need for a

hearing and refused to reconsider this position in light of later circumstances with an

open mind. 

The Board’s holding in this case is not intended to turn the

“significant degree of public interest” standard into an evaluation of

whether there is any public interest. Neither is it intended to reduce a

permit issuer’s discretion in making the “significant degree of public

interest” determination. As this decision recognizes, the factors the

Region put forward in this case in its Supplemental Brief are relevant

to that determination. Additionally, the Board is not suggesting that

the factors considered in this case are preclusive of the consideration

of other factors bearing on the degree of public interest that may be

identified under a different set of circumstances. Nonetheless, there

are limits to the permit issuer’s exercise of its discretion in evaluating

the degree of public interest. If a permit issuer decides not to hold a

public hearing under 40 C.F.R. § 124.12(a)(1), it must clearly

articulate its reason for that decision based on the type of factors

discussed in this opinion in light of the circumstances of that case.

The remand for a public hearing in this case is consistent with

the Board’s repeated emphasis on “the importance of ensuring that

Agency decisionmakers adhere fully to the public participation

requirement of [the Part 124] regulations.” In re Chevron Mich., LLC,

UIC Appeal No. 12-01, slip op. at 14 (EAB Mar. 5, 2013),

15 E.A.D. ___. The Board repeatedly has remanded permit decisions

for failure to comply fully with these requirements. E.g., id. at 14,

15 E.A.D. at ___ (considering and remanding permit because it was

unclear in the administrative record whether the Region had completed

responding to comments prior to issuance of the final permit decision);
48 SIERRA PACIFIC INDUSTRIES

In re Weber #4-8, 11 E.A.D. 241, 244-46 (EAB 2003) (considering

and remanding permit because the permit issuer signed and mailed the

response to comments letter three days after signing the final permit);

In Russell City Energy Ctr., PSD Appeal No. 08-01, slip op. at 34-39

(EAB July 29, 2008), 14 E.A.D. ___ (considering and remanding

permit because of procedural problems with the public notice of the

draft permit); see also In re Shell Offshore, Inc., OCS Appeal Nos. 11-

05 to 11-07, slip op. at 89-100 (EAB Mar. 30, 2012), 15 E.A.D. __

(considering alleged irregularities at the public hearing and in the

length of public comment period). Moreover, as noted above, the

Board specifically has taken into account the statutory objectives

behind the public participation provisions of the CAA in remanding a

PSD permit for failure to comply with part 124 regulations. In re

RockGen Energy Ctr., 8 E.A.D. 536, 557 (EAB 1999). The Board’s

view is that adherence to procedural requirements is critical to

upholding the “integrity” of the permit review process. In re

ConocoPhillips Co., 13 E.A.D. 768, 776 (EAB 2008); see Weber,

11 E.A.D. at 246 (“Although this remand may not result in any change

in the Region’s ultimate permit decision, remand is nonetheless

appropriate to ensure that the permit issuer fully complies with the

requirement to give adequate and timely consideration to public

comments at the time of issuing a final permit decision.”). A remand

for a public hearing on the Sierra Pacific permit will both support the

integrity of that permit proceeding and further the CAA’s statutory

objective of adequate public participation in permit decisionmaking.

B. The Board Need Not Resolve Whether the Region Abused Its

Discretion in Denying a Public Hearing Under 40 C.F.R.

§ 124.12(a)(2)

Mr. Coleman argues that the Region also abused its discretion

by not granting a public hearing under its discretionary authority under

40 C.F.R. § 124.12(a)(2). Coleman 1st Am. Pet. at 7. Mr. Coleman’s

claim here is that the Region should have exercised its discretion to

hold a public hearing because Shasta County is an environmental
SIERRA PACIFIC INDUSTRIES 49

 Ms. Strand and Ms. Draisner appear to make the same argument, although 30

not with explicit references to the regulatory provision.

 EPA stated that “Plan EJ 2014 uses the term ‘overburdened’ to describe the 31

minority, low-income, tribal and indigenous populations or communities in the United

States that potentially experience disproportionate environmental harms and risks due to

exposures or cumulative impacts or greater vulnerability to environmental hazards.”

78 Fed. Reg. 27,220, 27,220 (May 9, 2013).

justice community. Environmental justice considerations may be a 30

factor that a permit issuer considers when deciding whether to hold a

discretionary public hearing under 40 C.F.R. § 124.12(a)(2) or

conduct some other form of public outreach to overburdened

communities. In its recent environmental justice notice, EPA stated 31

that it “does not intend for its regional offices to enhance engagement

opportunities in every instance” where a permit may affect an

overburdened community; however, among the examples of the types

of permits that may lead a permit issuer to decide to hold enhanced

outreach were “[c]onstruction permits under the [CAA], especially

new major sources (or major modification of sources) of criteria

pollutants” if the permits involve significant public health or

environmental impacts and the community already was overburdened.

EPA Activities to Promote Environmental Justice in the Permit

Application Process, 78 Fed. Reg. 27,220, 27,223 (May 9, 2013).

EPA further noted that:

EPA regional offices have the discretion to use other

considerations to prioritize EPA-issued permits for

enhanced outreach that do not meet either or both of

those criteria. One important consideration would be

whether a community has expressed concerns over a

permit application or renewal. * * * EPA expects that

it will only infrequently provide enhanced outreach

for permitted activities in response to public concerns

in the absence of information about potential

significant public health or environmental impacts.
50 SIERRA PACIFIC INDUSTRIES

 Moreover, under 40 C.F.R. § 124.12(a)(2), the Region has broad latitude 32

when deciding whether to hold a public hearing to “clarify one or more issues involved

in the permit decision,” because the regulation explicitly commits such a decision to the

permit issuer’s “discretion.” Petitioners would have a high bar to succeed on a challenge

to a permit issuer’s decision not to hold a discretionary hearing. See 6 Jacob A. Stein

et al., Admin. Law § 51-03, at 51-243 (2013) (“The narrowest scope of judicial review

of an agency fact finding is afforded by the arbitrary, capricious, or abuse of discretion

test.”).

Id. at 27,224.32

For two reasons, however, the Board does not need to reach

this question. First, the Board has concluded above that the Region

should have held a public hearing under the mandatory hearing

provision in 40 C.F.R. § 124.12(a)(1). Second, Petitioners have not

credibly alleged that Shasta County is an environmental justice

community. Their comments on the draft permit contained only

unsupported assertions that Shasta County is an environmental justice

community or elliptical references to environmental justice. Reg. 9

Resp. attach. 1, exc. 9, at 2 (Mr. Coleman: “If the US EPA uses the

proper pollution scale, we feel that Environmental Justice is served.”);

id. at 7 (Mr. Simpson: “The EPA failed to identify the Environmental

Justice community in the vicinity of the proposed project.”); id. at 13

(Ms. Strand: “This [project] is clearly in violation of the intent of

Environmental Justice in which your agency is the lead federal

agency.”). These statements do not raise the question of whether

Shasta County is an environmental justice community with sufficient

specificity to preserve that issue for review by the Board. 40 C.F.R.

§ 124.19(a)(4)(ii); see RockGen, 8 E.A.D. at 548 (concluding that the

issue “was not raised with sufficient specificity during the comment

period and thus was not preserved for review by the Board”); see also

In re EcoEléctrica, LP, 7 E.A.D. 56, 69 & n.17 (EAB 1997) (noting

that the Region should “examine any ‘superficially plausible’ claim

that a minority or low-income population may be disproportionately

affected by a particular facility,” but rejecting a claim of

noncompliance with the Executive Order on environmental justice

because the party made no “showing” of a disproportionate impact on

a minority or low-income community or “even explain[ed] how or
SIERRA PACIFIC INDUSTRIES 51

 One of Ms. Draisner’s supplemental responses contains undocumented 33

allegations to the effect that Shasta County is a low-income community. E-mail from

Celeste Draisner, CCA, to Victoria Robinson, Office of Envtl. Justice, EPA (June 13,

2013). However, the failure to present these factual allegations to the Region cannot be

cured by including them in a petition for review, and certainly not by including them for

the first time in supplemental briefing on a legal question. See, e.g., In re City of

Palmdale, PSD Appeal No. 11-07, slip op. at 31 (EAB Sept. 17, 2012), 15 E.A.D. at ___

(“The Board frequently has rejected appeals where issues that were reasonably

ascertainable during the comment period were not raised at that time, but instead were

presented for the first time on appeal.”), appeal docketed sub nom. Simpson v. EPA,

No. 12-74124 (9th Cir. Dec. 18, 2012); RockGen, 8 E.A.D. at 546-48.

why an examination of additional data would be expected to reveal

such an impact”). 

33

In his Petition, however, Mr. Coleman asserts that Shasta

County already has been identified as an environmental justice

community by the Board in its decision in Knauf I. Coleman 1st Am.

Pet. at 6. Mr. Coleman is mistaken; he has misread the Board’s

decision in Knauf I. In that case, the Board remanded a PSD permit

because there was not a sufficient response in the record to

environmental justice concerns raised by a commenter. Knauf I,

8 E.A.D. 121, 175 (EAB 1999). The Board did not make a finding

regarding whether an environmental justice community in Shasta

County was affected by the permit in that case. When the case later

returned to the Board, the Board again did not reach the factual issue

of whether an environmental justice community was affected by the

permit. See Knauf II, 9 E.A.D. 1 (EAB 2000). Rather, the Board

upheld the Region’s conclusion that no one in Shasta County,

including anyone in any environmental justice communities, would be

adversely affected by the permit because “the additional [particulate

matter] from the proposed Knauf facility will not exceed the federal

NAAQS [National Ambient Air Quality Standards] or PSD increment

for [particulate matter].” Id. at 16. The Board expressly refused to

consider the petitioners’ challenge to the Region’s demographic

analysis of Shasta County. Id. at 17.

Accordingly, the Board has not considered whether the Region

abused its discretion in not holding a public hearing under 40 C.F.R.

§ 124.12(a)(2).
52 SIERRA PACIFIC INDUSTRIES

C. The Board Denies Review of a Number of Petitioners’ Challenges

as a Matter of Law

A number of issues raised by the Petitioners do not, as a

matter of law, meet the threshold requirements for review by the

Board and/or fail to demonstrate that the Region erred. The Board

addresses these challenges in the following pages, with the hope and

intent that their inclusion in this Order will assist in clarifying and

streamlining future proceedings for this PSD permit.

1. The Region Did Not Clearly Err or Abuse Its Discretion in

Paraphrasing or Summarizing Public Comments

Mr. Simpson and Ms. Strand each suggest that in responding

to public comments on the draft permit, the Region improperly

paraphrased or incompletely summarized their comments or the

comments of others. See Simpson Pet. at 7-8; Strand Pet. at 1. They

imply that this action, by itself, supplies a basis for remanding Sierra

Pacific’s permit.

The law is to the contrary. Permit issuers are required to

“[b]riefly describe and respond to all significant comments” submitted

during the public comment period, including at any public hearing.

40 C.F.R. § 124.17(a)(2). In fulfilling this obligation, permit issuers

are not required to respond on an individualized basis to each discrete

comment submitted by members of the public, in the same length and

level of detail as the comment itself. See, e.g., In re Wash. Aqueduct

Water Supply Sys., 11 E.A.D. 565, 587 (EAB 2004); In re Hillman

Power Co., 10 E.A.D. 673, 695-97 & n.20 (EAB 2002); Knauf I,

8 E.A.D. at 134-42. Instead, permit issuers are allowed to paraphrase

or summarize public comments, group similar comments together, and

provide unified responses thereto. See, e.g., In re Envtl. Disp. Sys.,

Inc., 12 E.A.D. 254, 286-87 (EAB 2005) (combination and paraphrase

of public comments is acceptable where permit issuer’s responses

“give ‘thoughtful and full consideration’ to public comments * * * and

are ‘clear and thorough enough to adequately encompass the issues

raised’” (quoting RockGen, 8 E.A.D. at 557, and Wash. Aqueduct,

11 E.A.D. at 585)).
SIERRA PACIFIC INDUSTRIES 53

Accordingly, in a case where, as here, petitioners claim that a

permit issuer paraphrased or summarized a public comment, such

claims are not, by themselves, sufficient to trigger a remand. If, by

making this kind of claim, the petitioners intend to question the

adequacy of the permit issuer’s response to comments, the petitioners

must explain what the permit issuer overlooked, omitted,

misunderstood, or otherwise did wrong in its response, as required by

the permitting regulations. See 40 C.F.R. § 124.19(a)(4). Otherwise,

the mere fact that a permit issuer did not fully quote a party’s entire

comment does not, by itself, indicate that the permit issuer failed to

respond adequately to that comment. E.g., Envtl. Disp. Sys.,

12 E.A.D. at 286-87; Hillman, 10 E.A.D. at 696-97 & n.20. Because

neither Mr. Simpson nor Ms. Strand provided more than a bare

assertion of improper paraphrase, the Board denies review of the

petitions on this basis.

2. The Region Did Not Clearly Err or Abuse Its Discretion in

Excluding Improperly Submitted Public Comments

Ms. Draisner argues that the Region erred by failing to include

her comments in the administrative record for Sierra Pacific’s permit

decision. She is incorrect. The public notice documents clearly

instructed interested parties to send written comments to Mr. Omer

Shalev at one of two possible addresses: (1) the Region’s air permits

electronic mail address at R9airpermits@epa.gov; or (2) the Region’s

physical office on 75 Hawthorne Street in San Francisco, California.

See AAQIR at 46-47; Region 9, U.S. EPA, Public Notice of Proposed

Permit Modification and Request for Public Comment, Sierra Pacific

Industries – Anderson Division 2 (Sept. 2012). Instead of complying

with these clear instructions, Ms. Draisner sent her comments to

Mr. Shalev’s personal EPA electronic mail account. See Letter from

Deborah Jordan, Dir., Air Div., EPA Reg. 9, to Celeste Draisner 1

(Mar. 16, 2013) (“Jordan Letter”).

The Region explains that it has a long-standing practice of

using a distinct electronic mail account for receiving public comments

on official PSD permitting actions, precisely so that it can avoid the

situation that arose here – i.e., comments that should have been part of

the Agency’s decisionmaking process are overlooked amidst the
54 SIERRA PACIFIC INDUSTRIES

dozens of unrelated electronic mails an individual EPA employee

might receive on any given day. Reg. 9 Resp. at 15. Such a practice is

entirely reasonable, and the Region has no duty to accept misdirected

comments from any party. See 40 C.F.R. §§ 124.10(d), .11, .13. To

find otherwise would undermine the smooth and timely processing of

permit applications and inject needless confusion and uncertainty into

the public comment and response process.

The Region actually went to extra lengths in this case to track

down Ms. Draisner’s comments and provide a public response. See

Jordan Letter at 1 & encl. In so doing, the Region appropriately did

not include its response in the administrative record, since the permit

decision was not based on those comments. Instead, the Region

categorized the comments and Agency response in the public permit

record as “Post-Final Decision Material Not Included in the

Administrative Record.” See http://www.regulations.gov/#!document

Detail;D=EPA-R09-OAR-2012-0634-0014. The Board denies review

of the petition on this issue.

3. The Region Did Not Clearly Err or Abuse Its Discretion in

Categorizing Sierra Pacific’s Proposed Boiler as a

“Major Modification” Rather Than as a “Major

Stationary Source”

Ms. Strand suggests that the Region erred by categorizing

Sierra Pacific’s proposed facility as a new “major modification” rather

than as a new “major stationary source” of air pollution. See Strand

Pet. at 1 (citing community’s “great confusion” on this question); see

also Letter from Kevin P. Bundy, Senior Att’y, CBD, to Omar Shalev,

EPA Reg. 9, at 10 (Oct. 17, 2012) (“CBD Comments”); RTC at 34.

She implies that the Region’s decision to categorize the facility in this

way resulted in Sierra Pacific receiving a less rigorous, less protective

air emissions permit than otherwise would have been the case.

Section 165(a) of the CAA provides that “[n]o major emitting

facility * * * may be constructed in any area” subject to the PSD

program unless the proposed facility first undergoes an air quality

review process and obtains a PSD permit that imposes limits on air

pollution emissions from the facility. CAA § 165(a)(1), 42 U.S.C.
SIERRA PACIFIC INDUSTRIES 55

§ 7475(a)(1). Both new “major stationary sources” and new “major

modifications” of such sources can qualify as “major emitting

facilities.” See CAA § 169(1), 42 U.S.C. § 7479(1) (definition of

“major emitting facility”); 40 C.F.R. § 52.21(b)(1)(i) (definition of

“major stationary source”); 40 C.F.R. § 52.21(b)(1)(i) (definition of

“major modification”).

Accordingly, both types of sources must employ BACT to

minimize emissions of regulated pollutants, conduct source impacts

and air quality analyses, and comply with other preconstruction review

requirements. See CAA § 165, 42 U.S.C. § 7475; 40 C.F.R.

§ 52.21(a)(2), (j), (k), (m); see also NMU, slip op. at 8, 14 E.A.D.

at ___ (holding that a proposed new boiler at an existing heating plant

was a “major modification” that would result in “a significant net

increase” of certain air contaminants and thus required a PSD permit);

In re Deseret Power Elec. Coop., PSD Appeal No. 07-03, slip op.

at 10, 12 (EAB Nov. 13, 2008), 14 E.A.D. ___ (holding that a

proposed new waste-coal combustion unit qualified as a “major

modification” of an existing major stationary source and as such

required a PSD permit).

Ms. Strand did not provide any specific legal reasons to

explain why the chosen categorization is erroneous or otherwise

problematic. See Strand Pet. at 1-2. Ms. Strand similarly did not

identify any specific differences in outcome that resulted from the

allegedly erroneous categorization. See id. Because Ms. Strand’s

arguments on this topic lack sufficient specificity, the Board denies

review of the petition on this issue. See Knauf II, 9 E.A.D. at 5-6

(denying pro se petitions for lack of sufficient specificity).

4. The Region Did Not Clearly Err or Abuse Its Discretion in

Its Treatment of Fine Particulate Matter Emissions Issues

Mr. Simpson argues that the Region erred in evaluating the air

qu 2.5 ality impacts of fine particulate matter (“PM ”) emissions from

Sierra Pacific’s proposed facility. He claims the Region: (1) lacked

authority to waive a purported “on-site monitoring requirement” for

PM2.5 2.5 ; (2) used a “Significant Impact Level” (“SIL”) for PM

2.5 averaged on an annual basis (“PM (annual)”) to determine that a
56 SIERRA PACIFIC INDUSTRIES

 EPA historically has used SILs and SMCs to help determine whether facility 34

emissions are significant enough to trigger various PSD requirements. A SIL is a

numeric value, measured in micrograms per cubic meter (“μg/m ”), that represents the 3 

level of ambient impact below which the EPA considers a source to have an insignificant

effect on ambient air quality. See 72 Fed. Reg. 54,112, 54,138-39 (Sept. 21, 2007). An

SMC is an “‘air quality concentration de minimis level[] for each pollutant * * * for the

purpose of providing a possible exemption from monitoring requirements.’” Id. at 54,141

(quoting 45 Fed. Reg. 52,676, 52,707 (Aug. 7, 1980)).

2.5 cumulative air quality impacts analysis for PM (annual) was not

necessary; and (3) relied on outdated or inapplicable air quality

mode 2.5 ling programs to analyze PM impacts. Simpson Pet. at 1-3.

None of these arguments were raised in the public comment period,

but Mr. Simpson claims they were not “reasonably ascertainable” at

that time and therefore may properly be raised for the first time in this

appeal. See id. at 1-2.

M 2.5 r. Simpson points out that the Region augmented its PM

analysis after the close of public comment in this case, to ensure its

permit decision accorded with a January 2013 ruling in Sierra Club v.

EPA, 705 F.3d 458 (D.C. Cir. 2013). See Simpson Pet. at 1-2; RTC

at 3-5. In that ruling, the United States Court of Appeals for the

District of Columbia Circuit (“D.C. Circuit” or “Court”) vacated and

2.5 remanded final PSD regulations that governed the use of PM SILs.

705 F.3d at 463-66. The court also vacated PSD regulations that

2.5 established a PM “Significant Monitoring Concentration”

(“SMC”). Id. at 466-69. 34

2.5 a. The Region Did Not Waive the PM Monitoring

Requirements, as Mr. Simpson Alleges

Mr. Simpson cites the Sierra Club decision to support his

argument that the Region lacked authority to waive the monitoring

2.5 requirements for PM emissions. See Simpson Pet. at 2-3. This

argument fails because the Region did not, in fact, waive the

requirements. Instead, in keeping with the PSD regulations, Sierra

Pa 2.5 cific submitted ambient PM monitoring data collected in 2011

from a station at the Redding Department of Health, approximately

6.5 miles to the northeast of the proposed project site. See AAQIR
SIERRA PACIFIC INDUSTRIES 57

In addition, in striking down the SILs themselves, the D.C. Circuit declined 35

to rule on the deeper question whether EPA possesses authority to promulgate SILs in the

first instance. The court explicitly stated that that legal question was “not prudentially

ripe” and therefore was reserved for another day. Sierra Club, 705 F.3d at 464.

at 28 & tbl.8.2-1; see also 40 C.F.R. §§ 51.166(m)(1)(i), (ii), (iv),

52.21(m)(1)(i), (ii), (iv). As the Board explained in NMU, “EPA has

long implemented the PSD program pursuant to the understanding that

representative data may be substituted [for on-site data] where

circumstances warrant, * * * and the Board and its predecessors have

long upheld the Agency’s guidance to that effect.” Slip op. at 62,

14 E.A.D. at ___ (citing Agency guidance documents). The Board

denies review of the petition on this issue.

b. The Region Did Not Solely Rely on the Now-Vacated

SIL for 2.5 PM (Annual) Emissions as a Basis for

Excusing the Cumulative Impacts Analysis for That

Pollutant, as Mr. Simpson Alleges

Mr. Simpson also cites the Sierra Club decision to support his

argument that the Region erroneously relied on a SIL (now vacated) to

avoid analyzing the cumulative impacts of Sierra Pacific’s projected

PM2.5 (annual) emissions. Simpson Pet. at 1-2. This argument fails

b 2.5 ecause in excusing the PM (annual) cumulative impacts analysis,

the Agency did not merely compare Sierra Pacific’s projected average

2.5 annual PM emissions to the relevant SIL.35

Instead, in light of the Sierra Club decision, the Region

2.5 carefully examined the ambient air concentration of PM and

2.5 concluded that both the background PM levels and Sierra Pacific’s

pro 2.5 2.5 jected PM emissions were sufficiently low that neither the PM

(annual) NAAQS nor PSD increment was in any danger of being

exceeded. See RTC at 4 (observing that “[t]he AAQIR and further

analysis included here show that the Project does not present the type

of situation in which existing air quality in the affected area is already

close to the NAAQS or PSD increment, such that a source with an

2.5 impact below the PM SILs could nevertheless cause or contribute to
58 SIERRA PACIFIC INDUSTRIES

2.5 a violation of the PM NAAQS or increment”) (emphasis added).

Therefore, the Board denies review of the petition on this issue.

c. Mr. Simpson Did Not Preserve for Review Issues

Related to the Region’s Use of AERMOD and

CALPUFF Modeling Programs

Finally, Mr. Simpson argues that the Region erred by relying

on an “antiquated” version of “AERMOD,” an air quality modeling

program used to assess impacts within fifty kilometers of a proposed

stationary source. Simpson Pet. at 2; see 40 C.F.R. pt. 51, app. W,

§ 4.2.2.b. He argues further that the Region also erred by relying on

“CALPUFF,” another air quality modeling program used to assess

impacts at greater distances (i.e., fifty to 300 kilometers). Simpson

Pet. at 2-3; see 40 C.F.R. pt. 51, app. W, §§ 6.1, 6.2.3. Mr. Simpson

does not cite to anything new in Sierra Club in so arguing because that

decision does not address questions of appropriate use of these models.

Instead, he references Sierra Pacific’s 2010 permit application and

May 2012 air quality modeling correspondence. Both of these

documents were available for review during the original public

comment period; thus, under the permitting regulations, arguments

pertaining to them were reasonably ascertainable at that time and

should have been raised then. See 40 C.F.R. §§ 124.13, .19(a).

Accordingly, the Board denies review of the petition on this issue. See

In re Christian Cnty. Generation, LLC, 13 E.A.D. 449, 459 (EAB

2008) (“The regulatory requirement that a petitioner must raise issues

during the public comment period ‘is not an arbitrary hurdle, placed in

the path of potential petitioners simply to make the process of review

more difficult; rather, it serves an important function related to the

efficiency and integrity of the overall administrative scheme.” (quoting

In re BP Cherry Point, 12 E.A.D. 209, 219 (EAB 2005))).
SIERRA PACIFIC INDUSTRIES 59

5. The Region Did Not Clearly Err or Abuse Its Discretion in

Determining That the Addition of a Solar Energy

Component or the Alteration of the 90% Biomass-10%

Natural Gas Fuel Mix Would “Redefine the Source”

To establish appropriate air pollution emissions limits through

BACT analyses, permit issuers routinely consider the capabilities of

“inherently lower polluting” processes or practices and “add-on” air

pollution control technologies that are available for use at the proposed

facility. See Office of Air Quality Planning & Standards, U.S. EPA,

New Source Review Workshop Manual B.10 (draft Oct. 1990). As a

general matter, however, Agency policy provides that permit issuers

need not consider technology alternatives that would require

“redefining the design” of the source (or, as shorthand terminology,

“redefining the source”), as proposed by the permit applicant. See id.

at B.13; Knauf II, 8 E.A.D. at 136.

The Board has developed a body of case law on the concept of

“redefining the source,” which contains detailed explanations of the

history, basis, and functioning of the policy. See, e.g., In re City of

Palmdale, PSD Appeal No. 11-07, slip op. at 34-52 (EAB Sept. 17,

2012), 15 E.A.D. ___, appeal docketed sub nom. Simpson v. EPA,

No. 12-74124 (9th Cir. Dec. 18, 2012); In re Desert Rock Energy Co.,

PSD Appeal Nos. 08-03 to -06, slip op. at 56-65 (EAB Sept. 24,

2009), 14 E.A.D. ___; NMU, slip op. at 26-28, 14 E.A.D. at ___; In re

Prairie State Generating Co., 13 E.A.D. 1, 14-34 (EAB 2006), aff’d

sub nom. Sierra Club v. EPA, 499 F.3d 653 (7th Cir. 2007).

In a nutshell, these cases indicate that permit issuers should

begin their analyses of potentially available control technologies by

examining how the permit applicant defines the proposed facility’s

“purpose” or “basic design,” which typically is set forth in the permit

application and related documents. See, e.g., Palmdale, slip op. at 43,

45, 15 E.A.D. at ___; Desert Rock, slip op. at 64, 66-67, 14 E.A.D.

at ___; Prairie State, 13 E.A.D. at 21-23. The permit issuer then takes

a “hard look” at which design elements are “inherent” to the

applicant’s purpose and which design elements could possibly be

altered to achieve pollutant emissions reductions without disrupting

the applicant’s “basic business purpose” for the proposed facility. See,
60 SIERRA PACIFIC INDUSTRIES

e.g., Desert Rock, slip op. at 64, 69, 14 E.A.D. at ___; NMU, slip op.

at 26-28, 14 E.A.D. at ___; Prairie State, 13 E.A.D. at 27; Knauf I,

8 E.A.D. at 136-44. In taking this hard look, the permit issuer must

ensure that the proposed facility’s design has been “derived for

reasons independent of air quality permitting.” Palmdale, slip op.

at 43, 15 E.A.D. at ___ (citing cases). Finally, the permit issuer has

discretion under section 165(a)(2) of the CAA, 42 U.S.C.

§ 7475(a)(2), to consider “alternatives” to the proposed facility. See,

e.g., Desert Rock, slip op. at 56, 68-72, 14 E.A.D. at ___; Prairie

State, 13 E.A.D. at 28-34.

In the present case, Mr. Simpson argues that the Region

provided an inadequate response, unsupported by the administrative

record, to his comment suggesting that a solar energy component be

considered in the BACT analyses for the proposed facility. Simpson

Pet. at 5-7. Mr. Simpson had commented that “[a] solar component

would reduce all emissions by preheating the system or augmenting

the electrical output. Solar energy is an inherently lower emitting,

add-on control technology.” Simpson Comments at 2. Mr. Simpson

also argues on appeal that the Region erred by failing to include in the

BACT analyses different variations of the permitted fuel mix (10%

natural gas, 90% biomass). Simpson Pet. at 7-10. He states in his

comments that increased gas use would raise the total combustion

temperature, produce more complete combustion, and reduce

emissions, resulting in a cleaner facility. Simpson Comments at 1.

In declining to consider solar energy in its BACT analysis, the

Region responded as follows:

A solar component for this Project presents a

significant departure from the existing facility’s

operations and the Project’s purpose. In this instance,

the existing lumber facility will add equipment within

its existing physical footprint and utilize the excess

biomass at this and other Sierra Pacific sawmill or

lumber operations.

RTC at 13. The Region similarly declined to augment the BACT

analyses by investigating different fuel mix proportions, claiming that
SIERRA PACIFIC INDUSTRIES 61

it was “unclear what mix the commenter is ultimately recommending

and where this should be incorporated into the analysis.” Id. The

Region further explained that “[a]ccording to Sierra Pacific’s 2010

Application, Sierra Pacific intends to use biomass from existing Sierra

Pacific facilities, as well as in-forest materials and various sources of

agricultural and urban wood waste. Therefore, an inherent aspect of

the project is that its fuel use be primarily biomass.” Id. (emphasis

added).

The Board finds no basis for a remand on these issues. The

Board’s review of the record as a whole makes clear that Sierra

Pacific’s “purpose” in proposing this project is to put to use the

hundreds of thousands of bone-dry tons of wood waste the lumber

company has in the Shasta County region, for the production of

lumber and electricity. See, e.g., ENVIRON Int’l Corp., BiomassFired Cogeneration Project Authority to Construct and [PSD] Permit

Application for Sierra Pacific Industries-Anderson Facility 3-4

(Mar. 2010) (AR I.01) (“Permit Appl.”); AAQIR at 3-4. These

productive uses of waste biomass are the core of the proposed project;

thus, the “inherent aspect” identified by the Region in the response to

comments as the burning of biomass is reasonable and supported by

the record. Indeed, the record establishes that Sierra Pacific has more

surplus biomass at its various facilities than its proposed Anderson

boiler can consume on an annual basis. Specifically, the Region’s

AAQIR states:

Currently, the Anderson lumber operation produces

approximately 160,000 BDT of wood waste per year.

Approximately 60,000 BDT are consumed by the

existing cogeneration unit, 20,000 BDT are trucked to

other biomass power plants, and the roughly

80,000 BDT balance is trucked to other markets (e.g.

wood chips to pulp mills). The new proposed boiler

will have the capacity to consume a maximum of

219,000 BDT per year. Roughly 80,000 BDT will be

generated by the facility’s existing lumber operations

at its current output, [and] additional wood fuel will

be transported by truck to the facility from [Sierra

Pacific’s] other lumber operations in California.
62 SIERRA PACIFIC INDUSTRIES

 The Board notes that in its responses to comments, the Region gave 36

somewhat different responses as to the basic “purpose” of the facility. Compare, e.g.,

RTC at 13 (stating that a solar component “presents a significant departure” from the

project’s “purpose,” and noting that “an inherent aspect of the project is that its fuel use

be primarily biomass”) with id. at 24 (explaining that Sierra Pacific’s “business purpose

in constructing the new boiler is two-fold: to [provide] process steam for its mill

operations and to provide a renewable energy source of grid power”). The Region should

take care in the future to ensure that its statements regarding a project’s “purpose” or

“basic design” are clear and precise, so as to avoid misunderstandings of the kind

presented by members of the public in this case.

AAQIR at 4 (emphasis added); see Permit Appl. at 3-4 (“the available

supply from [Sierra Pacific]-owned or [-]controlled facilities and

timberlands totals 400,000 [BDT] per year”). Given these facts,

requiring Sierra Pacific to burn fewer tons of wood waste so that it

could generate solar power or burn more natural gas instead would

plainly disrupt the project’s “basic business purpose” of using as much

surplus biomass as possible to generate steam to be “used to dry

lumber in existing kilns for the lumber operation, as well as feed a

turbine that will drive a generator to produce electricity for use on site

or for sale to the electrical grid.” AAQIR at 4. 36

Solar power in particular would displace the applicant’s

proposal with an alternative energy source that, even though

renewable like biomass, would play absolutely no role in putting to

beneficial use Sierra Pacific’s millions of tons of wood waste. Given

these facts, requiring Sierra Pacific to set aside some of its surplus

biomass so that a solar component could be constructed and operated

instead would impermissibly redefine the source. See, e.g., Prairie

State, 13 E.A.D. at 14-34 (rejecting arguments that a proposed “minemouth” coal facility be compelled to burn low-sulfur fuel or install

alternative power sources (such as wind or solar) because such

changes would “redefine the source”). Accordingly, the Region did

not err by refusing to consider this option further.

The question of fuel mix is a closer one, in light of the fact

that the Agency’s Greenhouse Gas Permitting Guidance acknowledges

that “when a permit applicant has incorporated a particular fuel into

one aspect of the project design (such as startup or auxiliary
SIERRA PACIFIC INDUSTRIES 63

applications), this suggests that a fuel is ‘available’ to a permit

applicant.” Office of Air Quality Planning & Standards, U.S. EPA,

Doc. No. EPA-457/B-11-001, PSD and Title V Permitting Guidance

for Greenhouse Gases 28 (Mar. 2011). “In such circumstances,” the

guidance continues, “greater utilization of a fuel that the applicant is

already proposing to use in some aspect of the project design should

be listed as an option in Step 1 [of the BACT analysis,] unless it can

be demonstrated that such an option would disrupt the applicant’s

basic business purpose for the proposed facility.” Id.

This guidance gives a straightforward answer to the Region’s

purported questions about where in the BACT analysis consideration

of differing fuel mixes should be incorporated. See RTC at 13.

However, though the Region readily could have evaluated higher

percentages of natural gas than the 10% proposed by Sierra Pacific, to

do so again would have undermined the company’s plan to use as

much of its waste biomass fuel as possible, particularly at the 49% gas

level Mr. Simpson suggests. Simpson Pet. at 9. It also would have

triggered the imposition of New Source Performance Standards

x

(“NSPS”) emissions limits for NO that apply on an on-going basis to

wood- and natural gas-fired boilers of the type proposed by Sierra

Pacific. See 40 C.F.R. § 60.44b(d). The Agency’s CAA regulations

provide that if such a boiler has an “annual capacity factor” for natural

gas that is less than or equal to 10% of the total fuel input per year,

and if the owner/operator of such a boiler agrees to accept a federally

enforceable permit condition that restricts the natural gas fuel capacity

factor to 10% or less annually, then the owner/operator is allowed to

x

combust natural gas without complying with the NO NSPS. Id.

Sierra Pacific opted to accept such a permit condition, see

Final Permit at 10 (cond. X.G.2), which is perfectly acceptable and

lawful. See, e.g., 40 C.F.R. § 52.21(b)(4) (providing, in the definition

of a facility’s “potential to emit,” that an operational limit, such as a

restriction on the amount of material combusted, “shall be treated as

part of [the facility’s] design” if the limit is federally enforceable); id.

§ 52.21(b)(17) (providing that PSD permit conditions are “federally

enforceable”). It is not evidence of a project design “derived for

reasons of air quality permitting,” as Mr. Simpson alleges. See

Simpson Pet. at 10; see also Desert Rock, slip op. at 64, 14 E.A.D.
64 SIERRA PACIFIC INDUSTRIES

 In its response to the petitions, Sierra Pacific asserts that “one of the 37

important business purposes of the biomass boiler is to take part in California’s

renewable portfolio standard (‘RPS’), and increasing natural gas usage beyond 10%

would disqualify the plant for the RPS.” Sierra Pacific Resp. at 18. Notably, this RPS

purpose does not appear in Sierra Pacific’s 2010 Application, nor in the public notice or

AAQIR the Region issued in September 2012, nor has any information been provided to

the Board by either the Region or Sierra Pacific during these proceedings regarding the

RPS program to support this business objective. Indeed, the only reference to the RPS

program that the Board has been able to locate is in a June 2012 report submitted to the

Shasta County Planning Commission. See Reg. 9 Resp. attach. 1, exc. 12, at 3 (noting

that “the facility would be eligible for procurement through the State of California’s

[RPS,] which requires electric corporations to increase procurement of electricity

generated from renewable energy sources”). In the absence of more relevant and timely

record references, the Board assigns little weight to this belated assertion of project

purpose.

at ___ (noting that factors such as the “cost savings” of choosing one

control technology over another, or the “avoidance of risks associated

with new, innovative, or transferable technologies,” would not be

considered “fundamental” to a facility’s “basic design”). Instead, the

record establishes that Sierra Pacific will fire natural gas during boiler

startup and shutdown because that fuel – rather than biomass – can

best be used to increase combustion temperatures in a controlled

fashion and to stabilize the boiler flame during transitional periods.

Biomass then can be burned safely and efficiently during steady-state

conditions. See, e.g., Permit Appl. at 3, 5; AAQIR at 1, 12-13, 22, 37.

This prudent use of natural gas does not obviate Sierra

Pacific’s basic goal of using its excess wood waste to produce new

wood products and electricity, and the company’s lawful acceptance of

a 10% gas cap is incidental to the project’s basic design. It also does

not, by itself, suggest that the project’s fuel mix can be readily

changed without disrupting Sierra Pacific’s fundamental business

purpose of using its surplus natural resources in a beneficial manner.37

In sum, requiring Sierra Pacific to reduce its surplus biomass fuel so

that it could increase its natural gas fuel would impermissibly redefine

this proposed source. Accordingly, this option need not be entertained

further. See Reg. 9 Resp. at 38 (arguing, correctly, that “[t]he use of a

federally enforceable permit condition to avoid a potentially applicable
SIERRA PACIFIC INDUSTRIES 65

2 2 “Biogenic CO emissions” are emissions of CO from stationary sources that 38

“directly result[] fromthe combustion or decomposition of biologically[ ]based materials

othe 2r than fossil fuels and mineral sources of carbon.” Deferral for CO Emissions from

Bioenergy and Other Biogenic Sources Under the [PSD] and Title V Programs, 76 Fed.

Reg. 43 2,490, 43,493 (July 20, 2011). “Examples of ‘biogenic CO emissions’ include,

bu 2t are not limited to: * * * CO derived from combustion of biological material,

including all types of wood and wood waste, forest residue, and agricultural material.”

Id.

requirement does not invalidate the facility design or related

determinations regarding basic business purpose”).

D. The Board Declines to Reach the Carbon Dioxide Deferral Rule

Issue

Finally, Mr. Simpson incorporates by reference CBD’s

comments on the draft PSD permit, which challenged, among other

things, the Region’s decision to defer consideration of “biogenic”

2

carbon dioxide (“CO ”) emissions from Sierra Pacific’s proposed 38

large-scale burning of wood and wood waste. See Simpson Pet. at 10-

11; CBD Comments at 10-12. According to Mr. Simpson, the

Region’s deferral decision is clearly erroneous because it is based on

“unlawful rules” whose application in this case results in Sierra Pacific

b 2eing exempted from BACT requirements for biogenic CO emissions.

Simpson Pet. at 10. Mr. Simpson writes, “By not relying on unlawful

rules[,] the Region would have fully evaluated the project and [would]

not have approved it as they did.” Id.

In its response to CBD’s comments on this issue, the Region

explained that EPA had issued a final rule in July 2011 that justified

the Region’s deferral choice. That final rule had established a threey 2

ear deferral period for regulatory decisions about CO emissions from

biogenic sources (such as Sierra Pacific’s proposed boiler), during

which time the Agency planned to conduct further scientific review of

b 2iogenic CO emissions before deciding whether and how to regulate

2

such emissions. See RTC at 34-35; see also Deferral for CO

Emissions from Bioenergy and Other Biogenic Sources Under the

[PSD] and Title V Programs, 76 Fed. Reg. 43,490 (July 20, 2011)

(“Deferral Rule”). The Region further stated that an appeal of this rule
66 SIERRA PACIFIC INDUSTRIES

 The Court’s mandate must issue seven days after the time to file a petition 39

for rehearing expires, or seven days after entry of an order denying a timely petition for

panel rehearing, petition for rehearing en banc, or motion for stay of mandate, whichever

is later, unless the Court shortens or extends the time. See Fed. R. App. P. 41(b);

D.C. Cir. R. 41(a)(1). Moreover, the timely filing of a petition for panel rehearing,

petition for rehearing en banc, or motion for stay of mandate, stays the mandate until

disposition of the petition or motion, unless the Court orders otherwise. See Fed. R.

App. P. 41(d)(1); D.C. Cir. R. 41(a)(2).

was pending in the D.C. Circuit; however, until such time (if ever) as

the rule was overturned by the federal court, the Region had

discretionary authority to proceed in accordance with the rule. RTC

at 34-35.

On July 12, 2013, the D.C. Circuit vacated the Deferral Rule.

Ctr. for Biological Diversity v. EPA, Nos. 11-1101, 11-1285, 11-1328,

11-1336 (D.C. Cir. July 12, 2013). The Court’s judgment will not

become final and effective until such time as it issues a “mandate.”39

See Fed. R. App. P. 41; D.C. Cir. R. 41. At this writing, the Court has

not yet issued such a mandate, and the Agency still has a window of

time in which to evaluate the Court’s decision and determine how to

proceed in light of it.

Given these developments, the Board declines to reach the

b 2iogenic CO issue raised by Mr. Simpson. See In re Avenal Power

Ctr., LLC, PSD Appeal Nos. 11-02 to 11-05, slip op. at 14-15 (EAB

Aug. 18), 15 E.A.D. ___ (Board has discretion to review PSD

permits), appeal docketed sub nom. Sierra Club v. EPA, No. 11-73342

(9th Cir. Nov. 3, 2011). However, the Board expects that the Region

will consider Mr. Simpson’s challenge to the permit on this issue in

light of the decisions the Agency makes regarding the Court’s ruling

on the Deferral Rule.
SIERRA PACIFIC INDUSTRIES 67

VIII. CONCLUSION

For the foregoing reasons, the permit is remanded to Region 9

to hold a public hearing in accordance with 40 C.F.R. § 124.12(a)(1).

The Region is directed to reopen the permit proceedings for this

purpose, and shall issue a final permit decision and a document that

responds to any new comments received during the public hearing.

The Board denies the pending motions to file a petition out of time and

to submit additional documents. The Board also denies various

procedural and substantive arguments raised by Petitioners, as

discussed above. The Board declines to reach the challenge to the

Region’s decision to rely on the Deferral Rule to defer consideration

o 2f Sierra Pacific’s biogenic CO emissions and instead expects the

Region to consider this challenge consistent with the Agency’s

decisions on how to proceed in the wake of the D.C. Circuit’s recent

vacatur of this rule.

Once the Region issues a final permit decision following the

public hearing required by this remand, that final permit decision and

the Board’s decision in this case become final agency action subject to

judicial review. 40 C.F.R. § 124.19(l). Although an appeal to the

Board is a prerequisite to judicial review of an initial final permit

decision, id. at § 124.19(l)(1), such an appeal is not a prerequisite to

judicial review of a final permit decision following a Board remand of

a permit decision unless the Board “specifically provides that appeal

of the remand decision will be required to exhaust administrative

remedies.” Id. at § 124.19(l)(2)(iii). The Board is not requiring, and

will not accept, an appeal to the Board on the final permit decision

following remand in this case.

So ordered.
• 

o 

JUt 1 8 2013 

Is Board 

(Slip Opinion) 

NOTICE: This opinion is subject to formal revision before 

publication in the Environmental AdrninistrativeDecisions (E.A.D.). 

Readers are requested to notify the Environmental Appeals Board, 

U.S. Environmental Protection Agency, Washington, D.C. 20460, of 

any typographical or other formal errors, in order that corrections 

may be made before pUblication. 

BEFORE THE ENVIRONMENTAL APPEALS BOARD 


UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 


WASHINGTON, D.C. 


) 

) 

In re: ) 

) 

Sierra Pacific Industries ) PSDAppealNos.13-01, 

(Anderson Processing Facility) ) 13-02, 13-03 & 13-04 

) 

PSD Permit No. SAC 12-01 ) 

------------------------ ) 

[Decided July 18,2013] 

ORDER REMANDING IN PART AND 

DENYING REVIEW IN PART 

Before Environmental Appeals Judges Leslye M. Fraser, 

Randolph L. Hill, and Kathie A. Stein. 
CERTIFICATE OF SERVICE 

I hereby certify that copies ofthe foregoing Order Remanding in Part and Denying 

Review in Part in the matter of Sierra Pacific Industries (Anderson Processing Facility), PSD 

Appeal Nos. 13-01, 13-02, 13-03, and 13-04, were sent to the following persons in the manner 

indicated: 

By First Class U.S. Mail, 

Return Receipt Reg uested: 

Ed W. Coleman 

Post Office Box 1544 

Shasta Lake City~ California 96019 

Celeste Draisner 

1000 Shepard Court 

Redding, California 96002 

Heidi Strand 

Post Office Box 1544 

Shasta Lake City, California 96019 

Rob Simpson 

27126 Grandview Avenue 

Hayward, California 94543 

David C. Brown, P.E. 

Envtl. Affairs & Compliance Man'ager 

Sierra Pacific Industries 

19794 Riverside Avenue 

Redding, California 96049-6028 

William M. Sloan, Esq. 

Morrison & Foerster LLP 

425 Market Street 

San Francisco, California 94105-2482 

By EPA Pouch Mail: 

Kara Christenson, Esq. 


Office of Regional Counsel, Region 9 


U.S. Environmental Protection Agency 

75 Hawthorne Street 

Mail Code ORC-2 

San Francisco, California 94105 
By EPA Interoffice Mail: 

Janet McCabe, Deputy Assistant Administrator 

Office of Air and Radiation 

U. S. Environmental Protection Agency 

1200 Pennsylvania Avenue, N.W. 

Mail Code 6101A 

Washington, D. C. 20460-0001 

Lorie J. Schmidt, Esq. 

Office of General Counsel 

Air and Radiation Law Office 

U.S. Environmental Protection Agency 

1200 Pennsylvania Avenue, N.W. 

Mail Code 2344A 

Washington, D.C. 20460-0001 

Matthew Tejada, Director 

Office ofEnvironmental Justice 

U.S. Environmental Protection Agency 

1200 Pennsylvania Avenue, N.W. 

Mail Code 2201A 

Washington, D.C. 20460-0001 

Secretary