United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued December 10, 2013 Decided April 15, 2014

No. 12-1100

WHITE STALLION ENERGY CENTER, LLC,

PETITIONER

v.

ENVIRONMENTAL PROTECTION AGENCY,

RESPONDENT

AMERICAN ACADEMY OF PEDIATRICS, ET AL.,

INTERVENORS

Consolidated with 12-1101, 12-1102, 12-1147, 12-1172,

12-1173, 12-1174, 12-1175, 12-1176, 12-1177, 12-1178,

12-1180, 12-1181, 12-1182, 12-1183, 12-1184, 12-1185,

12-1186, 12-1187, 12-1188, 12-1189, 12-1190, 12-1191,

12-1192, 12-1193, 12-1194, 12-1195, 12-1196

On Petitions for Review of Final Rule of the 

United States Environmental Protection Agency

Lee B. Zeugin and Neil D. Gordon, Assistant Attorney

General, Office of the Attorney General for the State of

Michigan, argued the causes for State, Industry, and Labor

Petitioners. With them on the joint briefs were F. William

Brownell, Lauren E. Freeman, Elizabeth L. Horner, Bill

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 1 of 90
2

Schuette, Attorney General, Office of the Attorney General for

the State of Michigan, John J. Bursch, Solicitor General, S.

Peter Manning, Assistant Attorney General, Luther Strange,

Attorney General, Office of the Attorney General for the State

of Alabama, Michael C. Geraghty, Attorney General, Office of

the Attorney General for the State of Alaska, Steven E. Mulder,

Attorney, Peter S. Glaser, George Y. Sugiyama, Michael H.

Higgins, David B. Rifkin, Jr., Lee A. Casey, Mark W. DeLaquil,

Andrew M. Grossman, David Flannery, Gale Lea Rubrecht,

Kathy G. Beckett, Edward L. Kropp, Leslie Sue Ritts, Thomas

Horne, Attorney General, Office of the Attorney General for the

State of Arizona, Joseph P. Mikitish and James T. Skardon,

Assistant Attorneys General, Dustin McDaniel, Attorney

General, Office of the Attorney General for the State of

Arkansas, Kendra Akin Jones, Assistant Attorney General,

Charles L. Moulton, Senior Assistant Attorney General, Pamela

Jo Bondi, Attorney General, Office of the Attorney General for

the State of Florida, Jonathan A. Glogau, Attorney, Lawrence G.

Wasden, Attorney General, Office of the Attorney General for

the State of Idaho, Grant Crandall, Arthur Traynor, III, Eugene

M. Trisko, Gregory F. Zoeller, Attorney General, Office of the

Attorney General for the State of Indiana, Valerie Tachtiris,

Deputy Attorney General, Dennis Lane, Derek Schmidt,

Attorney General, Office of the Attorney General for the State

of Kansas, Jeffrey A. Chanay, Deputy Attorney General, Henry

V. Nickel, George P. Sibley III, Eric A. Groten, Jeremy C.

Marwell, John A. Riley, Christopher C. Thiele, Harold E.

Pizzetta III, Assistant Attorney General, Office of the Attorney

General for the State of Mississippi, Chris Koster, Attorney

General, Office of the Attorney General for the State of

Missouri, James R. Layton and John J. McManus, Attorneys,

Paul D. Clement, Nathan A. Sales, Lisa Marie Jaeger, Jon

Bruning, Attorney General, Office of the Attorney General for

the State of Nebraska, Katherine J. Spohn, Special Counsel to

the Attorney General, Wayne Stenehjem, Attorney General,

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 2 of 90
3

Office of the Attorney General for the State of North Dakota,

Margaret I. Olson, Steven C. Kohl, Eugene E. Smary, Sarah C.

Lindsey, E. Scott Pruitt, Attorney General, Office of the

Attorney General for the State of Oklahoma, P. Clayton

Eubanks, Assistant Attorney General, Michael DeWine,

Attorney General, Office of the Attorney General for the State

of Ohio, Dale T. Vitale and Gregg H. Bachmann, Assistant

Attorneys General, Robert M. Wolff, Special Counsel, Alan

Wilson, Attorney General, Office of the Attorney General for the

State of South Carolina, James Emory Smith, Jr., Assistant

Deputy Attorney General, Mark L. Shurtleff, Attorney General,

Office of the Attorney General for the State of Utah, Greg

Abbott, Attorney General, Office of the Attorney General for the

State of Texas, Jon Niermann, Chief, Mark Walters and Mary E.

Smith, Assistant Attorneys General, Kenneth T. Cuccinelli, II,

Attorney General, Office of the Attorney General for the

Commonwealth of Virginia, Patrick Morrisey, Attorney

General, Office of the Attorney General for the State of West

Virginia, Silas B. Taylor, Senior Deputy Attorney General,

Jeffrey R. Holmstead, Sandra Y. Snyder, Gregory A. Phillips,

Attorney General, Office of the Attorney General for the State

of Wyoming, Jay A. Jerde, Deputy Attorney General, Jack

Conway, Attorney General, Office of the Attorney General for

the State of Kentucky, Bart E. Cassidy, and Katherine L.

Vaccaro.

Bill Cobb argued the cause for Industry Petitioners’ Specific

Issues. With him on the briefs were Michael Nasi, Leslie Sue

Ritts, Jeffrey R. Holmstead, Sandra Y. Snyder, Paul D. Clement,

Nathan A. Sales, Steven C. Kohl, Eugene E. Smary, Sarah C.

Lindsay, Bart E. Cassidy, Katherine L. Vaccaro, John C. Hayes,

Jr., Dennis Lane, John A. Riley,Christopher C. Thiele,C. Grady

Moore, III, P. Stephen Gidiere, III, and Thomas Lee Casey, III.

Sanjay Narayan and Eric Schaeffer argued the causes for

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 3 of 90
4

Environmental Petitioners. With them on the briefs were

Whitney Farrell, James S. Pew, Neil Gormley, Ann Brewster

Weeks, and Darin Schroeder.

David Bookbinder argued the cause and filed the briefs for

petitioner Julander Energy Company. 

Michael B. Wigmore, Sandra P. Franco, Robin S. Conrad,

Rachel Brand, and Sheldon Gilbert were on the brief for amicus

curiae The Chamber of Commerce of the United States of

America in support of Industry Petitioners. 

Eric G. Hostetler, Matthew R. Oakes, and Amanda S.

Berman, Attorneys, U.S. Department of Justice, argued the

causes for respondent. With them on the brief was Wendy L.

Blake, Attorney, U.S. Environmental Protection Agency. 

Melissa Hoffer, Assistant Attorney General, Office of the

Attorney General for the Commonwealth of Massachusetts,

argued the cause for State and Local Government Intervenors in

support of Respondent. With her on the brief were Martha

Coakley, Attorney General, Office of the Attorney General for

the State of Massachusetts, Tracy Triplett and Carol A. Iancu,

Assistant Attorneys General, Kamala D. Harris, Attorney

General, Office of the Attorney General for the State of

California, Janill L. Richards, Supervising Deputy Attorney

General, Susan L. Durbin, Deputy Attorney General, Joseph R.

Biden, III, Attorney General, Office of the Attorney General for

the State of Delaware, Valerie M. Satterfield, Deputy Attorney

General, Thomas L. Miller, Attorney General, Office of the

Attorney General for the State of Iowa, David R. Sheridan,

Assistant Attorney General, George Jepsen, Attorney General,

Office of the Attorney General for the State of Connecticut,

Kimberly P. Massicotte and Matthew I. Levine, Assistant

Attorneys General, Lisa Madigan, Attorney General, Office of

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 4 of 90
5

the Attorney General for the State of Illinois, Matthew J. Dunn

and Gerald T. Karr, Assistant Attorneys General, Douglas F.

Gansler, Attorney General, Office of the Attorney General for

the State of Maryland, Roberta R. James, Assistant Attorney

General, Michael A. Delaney, Attorney General, Office of the

Attorney General for the State of New Hampshire, K. Allen

Brooks, Senior Assistant Attorney General, Janet T. Mills,

Attorney General, Office of the Attorney General for the State

of Maine, Gerald D. Reid, Assistant Attorney General, Lori

Swanson, Attorney General, Office of the Attorney General for

the State of Minnesota, Max Kieley, Assistant Attorney General,

Eric T. Schneiderman, Attorney General, Office of the Attorney

General for the State of New York, Michael J. Myers and Kevin

P. Donovan, Assistant Attorneys General, Ellen F. Rosenbaum,

Attorney General, Office of the Attorney General for the State

of Oregon, Paul A. Garrahan, Assistant Attorney-in-Charge,

Gary K. King, Attorney General, Office of the Attorney General

for the State of New Mexico, Stephen R. Farris, Assistant

Attorney General, Roy Cooper, Attorney General, Office of the

Attorney General for the State of North Carolina, James C.

Gulick, Senior Deputy Attorney General, J. Allen Jernigan,

Marc Bernstein, and Amy L. Bircher, Special Deputy Attorneys

General, William H. Sorrell, Attorney General, Office of the

Attorney General for the State of Vermont, Thea J. Schwartz,

Assistant Attorney General, George A. Nilson, William R.

Phelan, Jr., Peter F. Kilmartin, Attorney General, Office of the

Attorney General for the State of Rhode Island, George S.

Schultz, Special Assistant Attorney General, Irvin B. Nathan,

Attorney General, Office of the Attorney General for the District

of Columbia, Amy E. McDonnell, Deputy General Counsel,

Christopher King, Benna Ruth Solomon, and Jeremy Toth.

Sean H. Donahue argued the cause for Public Health,

Environmental, and Environmental Justice Group Respondent

Intervenors. With him on the brief were Pamela A. Campos,

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 5 of 90
6

Tomás Carbonell, Ann Brewster Weeks, Darin T. Schroeder,

James S. Pew, Neil E. Gormley, Sanjay Narayan, John D.

Walke, and John Suttles. Vickie L. Patton entered an

appearance.

Brendan K. Collins argued the cause for Industry

Respondent Intervenors. With him on the brief were Robert B.

McKinstry Jr., Lorene L. Boudreau, and Erik S. Jaffe. 

Peter S. Glaser, George Y. Sugiyama, F. William Brownell,

Lauren E. Freeman, Lee B. Zeugin, Elizabeth L. Horner, David

B. Rivkin Jr., Lee A. Casey, Mark W. DeLaquil, Andrew M.

Grossman, Jeremy C. Marwell, Eric A. Groton, Jeffrey R.

Holmstead, and Sandra Y. Snyder were on the brief for Industry

Intervenors in response to Environmental Petitioners. Henry V.

Nickel entered an appearance.

Peter S. Glaser, George Y. Sugiyama, Hahnah Williams, F.

William Brownell, Lauren E. Freeman, Lee B. Zeugin, Elizabeth

L. Horner, Jeremy C. Marwell, Eric A. Groton, Jeffrey R.

Holmstead, Sandra Y. Snyder, Bill Cobb, Michael Nasi, David

B. Rivkin Jr., Lee A. Casey, Mark W. DeLaquil, and Andrew M.

Grossman were on the brief for Intervenor Respondents in

Opposition to Brief of Petitioner Julander Energy Company. 

Wendy B. Jacobs, Adam Babich, and Michael A. Livermore

were on the brief for amici curiae Institute for Policy Integrity,

et al. in support of respondent.

Before: GARLAND, Chief Judge, and ROGERS and

KAVANAUGH, Circuit Judges.

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 6 of 90
7

PER CURIAM:*1

 In 2012, the Environmental Protection

Agency promulgated emission standards for a number of listed

hazardous air pollutants emitted by coal- and oil-fired electric

utility steam generating units. See National Emission Standards

for Hazardous Air Pollutants From Coal- and Oil-Fired Electric

Utility Steam Generating Units and Standards of Performance

for Fossil-Fuel-Fired Electric Utility, Industrial-CommercialInstitutional, and Small Industrial-Commercial-Institutional

Steam Generating Units, Final Rule, 77 Fed. Reg. 9304 (Feb.

16, 2012). In this complex case, we address the challenges to

the Final Rule by State, Industry, and Labor petitioners, by

Industry petitioners to specific aspects of the Final Rule, by

Environmental petitioners, and by Julander Energy Company. 

For the following reasons, we deny the petitions challenging the

Final Rule.

I.

In 1970, Congress enacted § 112 of the Clean Air Act, Pub.

L. No. 91-604, § 4(a), 84 Stat. 1676, 1685 (1970), to reduce

hazardous air pollutants (“HAPs”). See Sierra Club v. EPA, 353

F.3d 976, 979 (D.C. Cir. 2004); H. R. REP. NO. 101-490, at 150

(1990). The statute defined HAPs as “air pollutant[s] . . . which

in the judgment of the Administrator [of the Environmental

Protection Agency (“EPA”)] cause, or contribute to, air

pollution which may reasonably be anticipated to result in an

increase in mortality or an increase in serious irreversible, or

incapacitating reversible, illness.” § 112(a)(1), 84 Stat. at 1685. 

In its original form, § 112 required EPA to publish a list

containing “each hazardous air pollutant for which [it] intends

to establish an emission standard.” § 112(b)(1)(A), 84 Stat. at

* Parts I, II, and IV are written by Judge Rogers. Part III is

written by Judge Kavanaugh, as are his dissenting opinion in Part

II.B.2 and his concurring opinion in Part IV. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 7 of 90
8

1685. EPA then was to promulgate, within 360 days, emission

standards “provid[ing] an ample margin of safety to protect the

public health” for each listed HAP, unless EPA found that a

particular listed substance was in fact not hazardous. 

§ 112(b)(1)(B), 84 Stat. at 1685. Over the next eighteen years,

EPA listed only eight HAPs, established standards for only

seven, and as to these seven addressed only a limited selection

of possible pollution sources. See New Jersey v. EPA, 517 F.3d

574, 578 (D.C. Cir. 2008); S. REP. NO. 101-228, at 131 (1989). 

To remedy the slow pace of EPA’s regulation of HAPs,

Congress amended the Clean Air Act in 1990, see Pub. L. No.

101-549, 104 Stat. 2531 (1990) (“CAA”), by eliminating much

of EPA’s discretion in the process. See New Jersey, 517 F.3d at

578. In the amended § 112, Congress itself listed 189 HAPs that

were to be regulated, see CAA § 112(b), 42 U.S.C. § 7412(b),

and directed EPA to publish a list of “categories and

subcategories” of “major sources” and certain “area sources”

that emit these pollutants, CAA § 112(c), 42 U.S.C. § 7412(c). 

Once listed, a source category may only be delisted (with one

exception not relevant here) if EPA determines that “no source”

in that category emits HAPs in quantities exceeding specified

thresholds. CAA § 112(c)(9)(B), 42 U.S.C. § 7412(c)(9)(B). 

For each listed “category or subcategory of major sources and

area sources” of HAPs, EPA must promulgate emission

standards. CAA § 112(d)(1), 42 U.S.C. § 7412(d)(1). Section

112(d) provides, as relevant, that emission standards 

shall require the maximum degree of reduction in

emissions of the hazardous air pollutants subject to this

section (including a prohibition on such emissions,

where achievable) that the Administrator, taking into

consideration the cost of achieving such emission

reduction, and any non-air quality health and

environmental impacts and energy requirements,

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 8 of 90
9

determines is achievable[.]

CAA § 112(d)(2), 42 U.S.C. § 7412(d)(2) (emphasis added). 

For existing sources, these “maximum achievable control

technology” (“MACT”) standards may not be less stringent —

regardless of cost or other considerations — “than [] the average

emission limitation achieved by the best performing [] sources”

in the relevant category or subcategory. CAA

§ 112(d)(3)(A)–(B), 42 U.S.C. § 7412(d)(3)(A)–(B); see Nat’l

Lime Ass’n v. EPA, 233 F.3d 625, 629 (D.C. Cir. 2000). EPA

refers to minimum-stringency MACT standards as “floors.” 

Standards more stringent than the floors, determined pursuant to

§ 112(d)(2), are called “beyond-the-floor” limits. 

For electric utility steam generating units (“EGUs”),

however, Congress directed that prior to any listing EPA

conduct a study of “the hazards to public health reasonably

anticipated to occur as a result of [EGU HAP emissions] after

imposition of the requirements of this Chapter [i.e., Chapter 85

Air Pollution Prevention and Control].” CAA § 112(n)(1)(A),

42 U.S.C. § 7412(n)(1)(A) (emphasis added). The results of this

“Utility Study” were to be reported to Congress within three

years. Id. Further, Congress directed that:

The Administrator shall regulate [EGUs] under this

section, if the Administrator finds such regulation is

appropriate and necessary after considering the results

of the study required by this subparagraph.

Id. (emphasis added). Congress also directed EPA to conduct

two other studies on mercury emissions: the “Mercury Study”

on “the rate and mass of such emissions, the health and

environmental effects of such emissions, technologies which are

available to control such emissions, and the costs of such

technologies,” to be reported to Congress in four years, and the

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 9 of 90
10

National Institute of Environmental Health Sciences “study to

determine the threshold level of mercury exposure below which

adverse human health effects are not expected to occur,” to be

reported to Congress in three years. See CAA

§ 112(n)(1)(A)–(C), 42 U.S.C. § 7412(n)(1)(A)–(C). 

In December 2000, on the basis of the Utility Study and

other data subsequently gathered, EPA issued a notice of

regulatory finding “that regulation of HAP emissions from coaland oil-fired electric utility steam generating units under section

112 of the CAA is appropriate and necessary.” Regulatory

Finding on the Emissions of Hazardous Air Pollutants From

Electric Utility Steam Generating Units, 65 Fed. Reg. 79,825,

79,826 (Dec. 20, 2000) (“2000 Finding”). EPA found that

EGUs “are the largest source of mercury emissions in the U.S.”

and that “[m]ercury is highly toxic, persistent, and

bioaccumulates in food chains.” 65 Fed. Reg. at 79,827. 

Specifically, “[m]ercury emitted from [EGUs] . . . is transported

through the atmosphere and eventually deposits onto land or

water bodies” where it then changes into “a highly toxic”

substance called methylmercury. Id. Methylmercury

“biomagnifies in the aquatic food chain,” id., meaning that it

becomes concentrated in the bodies of predatory fish which

absorb the methylmercury their food sources contained. When

humans eat these contaminated fish, they also are exposed; the

methylmercury from the fish is absorbed into the bloodstream

and “distributed to all tissues including the brain.” Id. at 79,829. 

The risks are greatest for women of childbearing age, EPA

explained, because methylmercury “readily passes . . . to the

fetus and fetal brain,” id., and “the developing fetus is most

sensitive to the effects of methylmercury,” id. at 79,827. 

Children born to women who were exposed to methylmercury

during pregnancy have exhibited neurological abnormalities and

developmental delays. Id. at 79,829. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 10 of 90
11

EPA concluded that “the available information indicate[d]

that mercury emissions from [EGUs] . . . are a threat to public

health and the environment,” notwithstanding “uncertainties

regarding the extent of the risks due to electric utility mercury

emissions.” Id. (emphasis added). EPA also identified several

other metal and acid gas emissions from EGUs that were “of

potential concern,” namely arsenic, chromium, nickel, cadmium,

dioxins, hydrogen chloride, and hydrogen fluoride. Id. EPA

therefore determined that it was “appropriate” to regulate coaland oil-fired EGUs under § 112 because of the health and

environmental hazards posed by mercury emissions from EGUs,

and the availability of a number of control options to effectively

reduce such emissions. Id. at 79,830. EPA further determined

that it was “necessary” to regulate EGUs under § 112 because

implementation of other provisions of the CAA would “not

adequately address” the public health and environmental hazards

found. Id. Therefore, EPA added “coal- and oil-fired electric

utility steam generating units to the list of source categories

under section 112(c) of the CAA.” Id.

In 2005, EPA reversed its 2000 Finding and removed coaland oil-fired EGUs from the list of source categories under

§ 112(c). See Revision of December 2000 Regulatory Finding

on the Emissions of Hazardous Air Pollutants From Electric

Utility Steam Generating Units and the Removal of Coal- and

Oil-Fired Electric Utility Steam Generating Units From the

Section 112(c) List, 70 Fed. Reg. 15,994, 15,994 (Mar. 29, 2005)

(“2005 Delisting Decision”). This change was based on EPA’s

revised interpretation of § 112(n)(1)(A) and, to some extent, on

a revised assessment of the results of the Utility Study. EPA

concluded that it lacked authority under § 112(n)(1)(A) to

regulate on the basis of non-health hazards (e.g., environmental

harms), and should “focus solely” on the health effects directly

attributable to EGU emissions, rather than on EGUs’

contribution to overall pollutant levels. Id. at 15,998. Further,

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 11 of 90
12

EPA decided it could consider other relevant, “situation-specific

factors, including cost” that may affect whether regulation under

§ 112 is “appropriate.” Id. at 16,000–01. Critically, EPA

determined that it must make its “appropriate and necessary”

finding by reference to health hazards that will remain “after

imposition of the requirements of” the CAA. Id. at 15,998

(emphasis added) (quoting CAA § 112(n)(1)(A), 42 U.S.C.

§ 7412(n)(1)(A)). EPA interpreted these other “requirements”

to include “not only those requirements already imposed and in

effect, but also those requirements that EPA reasonably

anticipates will be implemented” and which “could either

directly or indirectly result in reductions of utility HAP

emissions.” Id. at 15,999. Concluding that regulation under

other provisions of the CAA would adequately address EGU

emissions of mercury and other HAPs, EPA determined that

regulation under § 112 was neither “appropriate” nor

“necessary.” Id. at 16,002–08. In responding to comments,

EPA stated that if it were to regulate EGU emissions, then it

would regulate only those substances for which it had made a

specific “appropriate and necessary” determination. States and

other groups petitioned for review and this court vacated the

2005 Listing Decision, New Jersey, 517 F.3d at 583, holding

that EPA’s attempt to reverse its December 2000 listing decision

was unlawful because Congress had “unambiguously limit[ed]

EPA’s discretion to remove sources, including EGUs, from the

section 112(c)(1) list once they have been added to it.”

In 2012, after notice and comment, EPA “confirm[ed]” its

2000 Finding that regulation of EGU emissions under § 112 is

“appropriate and necessary.” Final Rule, 77 Fed. Reg. 9304,

9310–11. In the proposed rule, EPA stated that “the December

2000 Finding was valid at the time it was made based on the

information available to the Agency at that time.” Proposed

Rule, 76 Fed. Reg. 24,976, 24,986, 24,994–97 (May 3, 2011) 

(“NPRM”). Although of the view that no further evidence was

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 12 of 90
13

required to affirm the 2000 Finding, EPA had conducted

additional quantitative and qualitative analyses “confirm[ing]

that it remains appropriate and necessary today to regulate

EGUs under CAA section 112.” Id. at 24,986; see id. at

24,999–25,020. With respect to the term “appropriate,” EPA

explained that it was “chang[ing] the position taken in 2005 that

the appropriate finding could not be based on environmental

effects alone”; “revisiting the 2005 interpretation that required

the Agency to consider HAP emissions from EGUs without

considering the cumulative impacts of all sources of HAP

emissions”; “revising the 2005 interpretation that required the

Agency to evaluate the hazards to public health after imposition

of the requirements of the CAA”; and “rejecting the 2005

interpretation that authorizes the Agency to consider other

factors (e.g., cost), even if the agency determines that HAP

emitted by EGUs pose a hazard to public health (or the

environment).” Id. at 24,989. With respect to the term

“necessary,” EPA rejected as “unreasonable” its interpretation

in 2005 that regulation under § 112 was “necessary” only if no

other provision in the CAA — whether implemented or only

anticipated — could “directly or indirectly” reduce HAP

emissions to acceptable levels. Id. at 24,992.

EPA explained that it interpreted § 112(n)(1)(A)

to require the Agency to find it appropriate to regulate

EGUs under CAA section 112 if the Agency

determines that the emissions of one or more HAP

emitted from EGUs pose an identified or potential

hazard to public health or the environment at the time

the finding is made. If the Agency finds that it is

appropriate to regulate, it must find it necessary to

regulate EGUs under section 112 if the identified or

potential hazards to public health or the environment

will not be adequately addressed by the imposition of

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 13 of 90
14

the requirements of the CAA. Moreover, it may be

necessary to regulate utilities under section 112 for a

number of other reasons, including, for example, that

section 112 standards will assure permanent reductions

in EGU HAP emissions, which cannot be assured

based on other requirements of the CAA.

Id. at 24,987–88. EPA also affirmed that coal- and oil-fired

EGUs were properly listed as a source category under § 112(c). 

See id. at 24,986. EPA adhered to these interpretations in the

Final Rule, 77 Fed. Reg. at 9311. Accordingly, on February 16,

2012, EPA promulgated emission standards for a number of

listed HAPs emitted by coal- and oil-fired EGUs. See id. at

9487–93.

Several petitions for review challenge the Final Rule. We

first address, in Part II, the challenges of the State, Industry, and

Labor petitioners. In Part III, we address Industry petitioners’

specific issues. In Part IV.A, we address the challenges by the

Environmental petitioners, and in Part IV.B, Julander Energy

Company’s standing. In addressing the substantive challenges

to the Final Rule, this court must determine under the CAA

whether the Final Rule was promulgated in a manner that was

arbitrary or capricious, an abuse of discretion, or otherwise not

in accordance with law. See CAA § 307(d)(9)(A), 42 U.S.C.

§ 7607(d)(9)(A). “The ‘arbitrary and capricious’ standard

deems the agency action presumptively valid provided the action

meets a minimum rationality standard.” Sierra Club, 353 F.3d

at 978–79 (quoting Natural Res. Def. Council v. EPA, 194 F.3d

130, 136 (D.C. Cir. 1999)). That is, “[i]f EPA acted within its

delegated statutory authority, considered all of the relevant

factors, and demonstrated a reasonable connection between the

facts on the record and its decision, we will uphold its

determination.” Ethyl Corp. v. EPA, 51 F.3d 1053, 1064 (D.C.

Cir. 1995). The court will show particular deference “where the

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 14 of 90
15

agency’s decision rests on an evaluation of complex scientific

data within the agency’s technical expertise.” Troy Corp. v.

Browner, 120 F.3d 277, 283 (D.C. Cir. 1997); see also Marsh v.

Or. Natural Res. Council, 490 U.S. 360, 377 (1989).

II.

State, Industry, and Labor petitioners challenge EPA’s

interpretation and application of the “appropriate and necessary”

requirement in § 112(n)(1)(A).

A.

As a threshold matter, petitioners contend that the 2000

Finding was unlawful because EPA did not allow notice and

comment on the finding, did not quantify the relevant mercury

emissions and associated health risks, and did not describe

“alternative control strategies” as required under § 112(n)(1)(A). 

Because the December 2000 notice was “fundamentally

flawed,” they contend it “could have no legal consequences” and

“could not provide the basis for a § 112(c) listing decision.” 

State, Industry & Labor Pet’rs’ Br. (hereinafter “SIL Br.”)

27–28. Without a proper listing under § 112(c), they contend,

EPA has no authority to regulate EGUs under § 112(d).

The court need not decide whether EPA’s December 2000

“appropriate and necessary” finding was procedurally or

substantively valid because EPA reconsidered and

“confirm[ed]” that determination in the Final Rule. See NPRM,

76 Fed. Reg. at 24,977; Final Rule, 77 Fed. Reg. at 9310–11,

9320. For the reasons we will discuss, we hold that EPA’s

finding in the Final Rule was substantively and procedurally

valid, and consequently any purported defects in the 2000

Finding have been cured, rendering petitioners’ challenge to

December 2000 “appropriate and necessary” finding moot. Cf.

Fund for Animals, Inc. v. Hogan, 428 F.3d 1059, 1063–64 (D.C.

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 15 of 90
16

Cir. 2005).

B.

The crux of petitioners’ challenge to the Final Rule focuses

on EPA’s interpretation of the phrase “appropriate and

necessary” in § 112(n)(1)(A), 42 U.S.C. § 7412(n)(1)(A). The

context of this phrase is as follows. In a special subsection on

EGUs, Congress first directed: “The Administrator shall perform

a study of the hazards to public health reasonably anticipated to

occur as a result of emissions by electric utility steam generating

units of pollutants listed under subsection (f) after imposition of

the requirements of this Act.” CAA § 112(n)(1)(A), 42 U.S.C.

§ 7412(n)(1)(A) (emphasis added). Congress then directed: 

“The Administrator shall regulate electric utility steam

generating units under this section, if the Administrator finds

such regulation is appropriate and necessary after considering

the results of the study required by this subparagraph.” Id.

(emphasis added). Apart from the instruction to “consider[] the

results of the [Utility Study]” on public health hazards from

EGU emissions, the statute offers no express guidance regarding

what factors EPA is required or permitted to consider in

deciding whether regulation under § 112 is “appropriate and

necessary.” Neither does it define the words “appropriate” or

“necessary.” See NPRM, 76 Fed. Reg. at 24,986; 2005 Listing

Decision, 70 Fed. Reg. at 15,997. Petitioners object to how EPA

chose to fill these gaps.

In matters of statutory interpretation, the court applies the

familiar two part test under Chevron U.S.A., Inc. v. Natural

Resources Defense Council, Inc., 467 U.S. 837, 842–43 (1984). 

First, the court employs traditional tools of statutory

construction to determine de novo “whether Congress has

directly spoken to the precise question at issue.” Id. at 842, 843

n.9. If the court “ascertains that Congress had an intention on

the precise question at issue,” id. at 843 n.9, “that is the end of

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 16 of 90
17

the matter” and the court “must give effect to the unambiguously

expressed intent of Congress,” id. at 842–43. If, however, “the

statute is silent or ambiguous with respect to the specific issue,”

the court will uphold the agency’s interpretation so long as it

constitutes “a permissible construction of the statute.” Id. at

843. “In such case, a court may not substitute its own

construction of a statutory provision for a reasonable

interpretation made by the administrator of an agency.” Id. at

844.

To the extent petitioners’ challenge concerns EPA’s change

in interpretation from that in 2005, our approach is the same

because “[a]gency inconsistency is not a basis for declining to

analyze the agency’s interpretation under the Chevron

framework.” Nat’l Cable & Telecomms. Ass’n v. Brand X

Internet Servs., 545 U.S. 967, 981 (2005). That is, “if the

agency adequately explains the reasons for a reversal of policy,

change is not invalidating, since the whole point of Chevron is

to leave the discretion provided by the ambiguities of a statute

with the implementing agency.” Id. (internal quotation marks

omitted). And while “[u]nexplained inconsistency” may be “a

reason for holding an interpretation to be an arbitrary and

capricious change from agency practice,” id., our review of a

change in agency policy is no stricter than our review of an

initial agency action, see FCC v. Fox Television Stations, Inc.,

556 U.S. 502, 514–16 (2009). Thus, although an agency may

not “depart from a prior policy sub silentio or simply disregard

rules that are still on the books,” the agency “need not

demonstrate to a court’s satisfaction that the reasons for the new

policy are better than the reasons for the old one.” Id. at 515. 

Rather, “it suffices that the new policy is permissible under the

statute, that there are good reasons for it, and that the agency

believes it to be better.” Id.

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 17 of 90
18

1. Reliance on delisting criteria. In the Final Rule, EPA

concluded that it is “appropriate and necessary” to regulate HAP

emissions on the basis, inter alia, that EGU emissions of certain

HAPs pose a cancer risk higher than the standard set forth in the

§ 112(c)(9) delisting criteria (i.e., greater than one in a million

for the most exposed individual). See Final Rule, 77 Fed. Reg.

at 9311; NPRM, 76 Fed. Reg. at 24,998. Petitioners contend

that by so doing EPA wrongly conflated the delisting criteria

with the “appropriate and necessary” determination. “By

applying the delisting provisions of § 112(c)(9) in making the

initial, pre-listing determination whether it is ‘appropriate and

necessary’ to regulate EGUs, EPA has unlawfully imposed

requirements on itself the Congress chose not to impose at the

listing stage.” SIL Br. 35. They maintain that EPA’s approach

“would treat EGUs the same as all other major source categories

— as a category that must be listed unless the delisting criteria

are met.” Id.

EPA explained that it was relying upon the delisting criteria

to interpret an ambiguous term in § 112(n)(1)(A), namely,

“hazards to public health,” see Final Rule, 77 Fed. Reg. at

9333–34; NPRM, 76 Fed. Reg. at 24,992–93, because the

phrase “hazards to public health” is nowhere defined in the

CAA. EPA looked to the delisting criteria, which specify the

risk thresholds below which a source category need not be

regulated, as evidence of congressional judgment as to what

degree of risk constitutes a health hazard. See id. EPA

explained:

Although Congress provided no definition of hazard to

public health, section 112(c)(9)(B) is instructive. In

that section, Congress set forth a test for removing

source categories from the section 112(c) source

category list. That test is relevant because it reflects

Congress’ view as to the level of health effects

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 18 of 90
19

associated with HAP emissions that Congress thought

warranted continued regulation under section 112.

NPRM, 76 Fed. Reg. at 24,993 (emphasis added); see Final

Rule, 77 Fed. Reg. at 9333–34. EPA concluded that it had

discretion also to consider various other factors in evaluating

hazards to public health, including

the nature and severity of the health effects associated

with exposure to HAP emissions; the degree of

confidence in our knowledge of those health effects;

the size and characteristics of the populations affected

by exposures to HAP emissions; [and] the magnitude

and breadth of the exposures and risks posed by HAP

emissions from a particular source category, including

how those exposures contribute to risk in populations

with additional exposures to HAP from other sources[.]

NPRM, 76 Fed. Reg. at 24,992; see Final Rule, 77 Fed. Reg. at

9334.

EPA reasonably relied on the § 112(c)(9) delisting criteria

to inform its interpretation of the undefined statutory term

“hazard to public health.” Congress did not specify what types

or levels of public health risks should be deemed a “hazard” for

purposes of § 112(n)(1)(A). By leaving this gap in the statute,

Congress delegated to EPA the authority to give reasonable

meaning to the term. Cf. Chevron, 467 U.S. at 843–44. EPA’s

approach does not, as petitioners contend, “treat EGUs the same

as all other major source categories.” SIL Br. 35. Other major

source categories must be listed unless the delisting criteria are

satisfied; EPA’s approach treats EGUs quite differently. For

EGUs, EPA reasonably determined that it may look at a broad

range of factors — only one of which concerned the § 112(c)(9)

benchmark levels — in assessing the health hazards posed by

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 19 of 90
20

EGU HAPs. Nowhere does EPA state or imply that the delisting

criteria provide the sole basis for determining whether it is

“appropriate and necessary” to regulate EGUs under § 112. 

Because EPA’s approach is based on a permissible construction

of § 112(n)(1)(A), it is entitled to deference and must be upheld.

2. Costs of regulation. Noting that in 2005 EPA construed

§ 112(n)(1)(A) to allow consideration of costs in determining

whether regulation of EGU HAP emissions is “appropriate,”

petitioners contend that EPA’s new interpretation to “preclude

consideration of costs,” SIL Br. 42, “unreasonably constrains the

language of § 112(n)(1)(A),” SIL Br. 39. They point to the

dictionary definition of “appropriate” and to the differences

between regulation of EGUs under § 112(n)(1)(A) and

regulating other sources under § 112(c), and to this court’s

precedent that “only where there is ‘clear congressional intent to

preclude consideration of cost’ [do] we find agencies barred

from considering costs.” SIL Br. 40 (quoting Michigan v. EPA,

213 F.3d 663, 678 (D.C. Cir. 2000), cert. denied, 532 U.S. 904

(2001)). They contend that EPA’s new interpretation “is also

unlawful because it eliminates the discretion that Congress

intended EPA to exercise after completing the Utility Study.”

SIL Br. 41. As they see it, if the statutory term “appropriate”

imposes any limit whatsoever, it must at least limit regulation to

“risks [that] are worth the cost of elimination.” SIL Reply Br.

14 (quoting Michigan v. EPA, 213 F.3d at 667 (addressing the

term “significant”)). 

In the Final Rule, EPA stated that “it is reasonable to make

the listing decision, including the appropriate determination,

without considering costs.” Final Rule, 77 Fed. Reg. at 9327. 

EPA reasoned that § 112(n)(1)(A) would have included an

“express statutory requirement that the Agency consider costs in

making the appropriate determination” if Congress wanted to

require EPA to do so. Id. EPA also noted that “[t]o the extent

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 20 of 90
21

[its] interpretation differs from the one set forth in 2005,” it had

“fully explained the basis for such changes.” Id. at 9323 (citing

NPRM, 76 Fed. Reg. at 24,986–93). (Even in 2005, EPA noted

only that “[n]othing precludes EPA from considering costs in

assessing whether regulation of [EGUs] under section 112 is

appropriate in light of all the facts and circumstances presented.” 

2005 Delisting Decision, 70 Fed. Reg. at 16,001 n.19.) In

responding to comments reacting to its position that “the better

reading of the term ‘appropriate’ is that it does not allow for the

consideration of costs in assessing whether hazards to public

health or the environment are reasonably anticipated to occur

based on EGU emissions,” NPRM, 76 Fed. Reg. at 24,989, EPA

observed that the dictionary definition of “appropriate” does not

require consideration of costs and that commenters had failed to

identify an express statutory requirement to that effect. EPA

also stated that it was reasonable to decline to consider costs in

the absence of an express statutory requirement to do so because

Congress, in enacting § 112, was principally concerned with

mitigating hazards to public health and the environment from

HAP emissions. See Final Rule, 77 Fed. Reg. at 9327. 

Inasmuch as Congress had treated the regulation of HAP

emissions differently in the 1990 Amendments because EPA

was not acting quickly enough, EPA concluded it was

reasonable to make a listing decision without considering costs. 

See id.

On its face, § 112(n)(1)(A) neither requires EPA to consider

costs nor prohibits EPA from doing so. Indeed, the word

“costs” appears nowhere in subparagraph A. In the absence of

any express statutory instruction regarding costs, petitioners rely

on the dictionary definition of “appropriate” — meaning

“especially suitable or compatible” or “suitable or proper in the

circumstances” — to argue that EPA was required “to take into

account costs to the nation’s electricity generators when

deciding whether to regulate EGUs.” SIL Br. 39 (citing

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 21 of 90
22

MERRIAM-WEBSTER’S ONLINE DICTIONARY; NEW OXFORD

AMERICAN DICTIONARY (2d ed. 2005)). Yet these definitions,

which do not mention costs, merely underscore that the term

“appropriate” is “open-ended,” “ambiguous,” and “inherently

context-dependent.” Sossamon v. Texas, 131 S. Ct. 1651, 1659

(2011); cf. Nat’l Ass’n of Clean Air Agencies v. EPA, 489 F.3d

1221, 1229 (D.C. Cir. 2007). 

Even if the word “appropriate” might require cost

consideration in some contexts, such a reading of “appropriate”

is unwarranted here, where Congress directed EPA’s attention

to the conclusions of the study regarding public health hazards

from EGU emissions. Throughout § 112, Congress mentioned

costs explicitly where it intended EPA to consider them. Cf.

CAA § 112(d)(2), 112(d)(8)(A)(i), 112(f)(1)(B), 112(f)(2)(A),

112(n)(1)(B), 112(s)(2), 42 U.S.C. § 7412(d)(2),

7412(d)(8)(A)(i), 7412(f)(1)(B), 7412(f)(2)(A), 7412(n)(1)(B),

7412(s)(2). Indeed, in the immediately following subparagraph

of § 112(n), Congress expressly required costs to be considered. 

CAA § 112(n)(1)(B), 42 U.S.C. § 7412(n)(1)(B). The contrast

with subparagraph A could not be more stark. “Where Congress

includes particular language in one section of a statute but omits

it in another section of the same Act, it is generally presumed

that Congress acts intentionally . . . in the disparate inclusion or

exclusion.” Russello v. United States, 464 U.S. 16, 23 (1983)

(alterations omitted); cf. Catawba Cnty., N.C. v. EPA, 571 F.3d

20, 36 (D.C. Cir. 2009). Petitioners offer no compelling reason

why Congress, by using only the broad term “appropriate,”

would have intended the same result — that costs be considered

— in § 112(n)(1)(A). The legislative history the dissent claims

“establishes” the point, Dissent at 13, consists of a Floor

statement by a single Congressman that at best is ambiguous.1

1 See 1 A LEGISLATIVE HISTORY OF THE CLEAN AIR ACT

AMENDMENTS OF 1990, at 1416–17 (1993) (statement by Rep. Oxley)

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 22 of 90
23

For these reasons, we conclude that the statute does not evince

unambiguous congressional intent on the specific issue of

whether EPA was required to consider costs in making its

“appropriate and necessary” determination under

§ 112(n)(1)(A).

Turning to EPA’s approach, its position that “nothing about

the definition of [‘appropriate’] compels a consideration of

costs,” Final Rule, 77 Fed. Reg. at 9327, is clearly permissible. 

In Whitman v. American Trucking Ass’ns, 531 U.S. 457 (2001),

Justice Scalia, writing for a unanimous Court, noted that the

Supreme Court has “refused to find implicit in ambiguous

sections of the CAA an authorization to consider costs that has

elsewhere, and so often, been expressly granted.” Id. at 467; see

also Natural Res. Def. Council v. U.S. EPA, 824 F.2d 1146,

1163–65 (D.C. Cir. 1987) (en banc). EPA’s interpretation is

consistent with that instruction. Just as in Whitman, EPA

declines to find in an ambiguous section what in so many other

CAA sections Congress has mentioned expressly. And even

assuming Whitman might be distinguished on grounds it

concerned a different provision of the CAA, the question

remains only whether EPA’s interpretation is permissible.

Petitioners cannot point to a single case in which this court has

required EPA to consider costs where the CAA does not

expressly so instruct. In Michigan v. EPA, this court merely

held that “the agency was free to consider . . . costs” under CAA

§ 110(a)(2)(D), 42 U.S.C. § 7410(a)(2)(D), as EPA had urged in

that case. 213 F.3d at 679 (emphasis added).

(indicating that the provision authorizing regulation of EGUs would

“avoid[] the imposition of excessive and unnecessary costs” by

ensuring that EPA can regulate “only if the studies described in

section 112(n) clearly establish that emissions . . . from such units

cause a significant risk of serious adverse effects on public health”). 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 23 of 90
24

EPA’s interpretation is also consistent with the purpose of

the 1990 Amendments, which were aimed at remedying “the

slow pace of EPA’s regulation of HAPs” following the initial

passage of the CAA. New Jersey, 517 F.3d at 578. To ensure

that HAP emissions would be reduced to at least minimallyacceptable levels, Congress, among other things, listed 189 HAP

substances for regulation and “restrict[ed] the opportunities for

EPA and others to intervene in the regulation of HAP sources.” 

Id. The overall purpose of the 1990 Amendments was to spur

EPA to action. Although Congress gave EGUs a three-year pass

when it instructed EPA to conduct a further study before

regulating EGUs, see CAA § 112(n)(1)(A), 42 U.S.C.

§ 7412(n)(1)(A), there is no indication that Congress did not

intend EPA to regulate EGUs if and when their public health

hazards were confirmed by the study, as they were here. 

Petitioners, and our dissenting colleague, suggest that

EPA’s interpretation is unreasonable because the notion that

Congress would have authorized EPA to regulate without any

consideration of regulatory costs is implausible. But this

argument rests on a false premise. Here, as in Whitman,

interpreting one isolated provision not to require cost

consideration does not indicate that Congress was unconcerned

with costs altogether, because Congress accounted for costs

elsewhere in the statute. Section 112(d)(2) expressly requires

EPA to “tak[e] into consideration the cost of achieving . . .

emission reduction[s]” when setting the level of regulation under

§ 112. CAA § 112(d)(2), 42 U.S.C. § 7412(d)(2). It is true that

this cost consideration requirement does not apply with respect

to MACT floors. Yet even for MACT floors, costs are reflected

to some extent because the floors correspond (by definition) to

standards that better-performing EGUs have already achieved,

presumably in a cost efficient manner. See CAA

§ 112(d)(3)(A), 42 U.S.C. § 7412(d)(3)(A). Moreover, Industry

respondent intervenors point out that petitioners’ proposed

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 24 of 90
25

approach would lead to an improbable “all-or-nothing” scheme

in which EPA could “choose not to regulate EGUs at all under

Section 112 based on cost, even though EPA could not consider

cost to justify a less stringent emission standard than the MACT

floor.” Indus. Resp’t Intvn’rs’ Br. 8.

Contrary to petitioners’ claims, the word “appropriate” is

not rendered meaningless unless interpreted to include cost

consideration. Petitioners contend that § 112(n)(1)(A) mandates

a two-step inquiry: EPA must “first identify ‘a health hazard’

from HAPs emitted from EGUs, and then determine whether

regulation of that health hazard is ‘appropriate and necessary.’” 

SIL Br. 41 (emphasis added). If the existence of a health hazard

automatically means regulation is appropriate, they contend,

then EPA has unlawfully abdicated the exercise of discretion

Congress delegated to it. This argument, too, is unpersuasive. 

First, the rulemaking record reflects that EPA did not focus

exclusively on health hazards in considering whether regulation

would be “appropriate”; EPA also considered “the availability

of controls to address HAP emissions from EGUs.” NPRM, 76

Fed. Reg. at 24,989; see id. at 24,997; see also Final Rule, 77

Fed. Reg. at 9311. The factual premise of petitioners’ argument

is therefore incorrect. Second, even if EPA had focused

exclusively on health hazards, the word “appropriate” would

still have meaning in § 112(n)(1)(A) because the provision does

not assume, as petitioners seem to suggest, that EPA would in

fact “identify ‘a health hazard’” from EGUs. SIL Br. 41. 

Rather, the statute directs EPA to “perform a study of the

hazards to public health reasonably anticipated to occur” and

then to “regulate [EGUs] . . . if the Administrator finds such

regulation is appropriate and necessary after considering the

results of the study.” CAA § 112(n)(1)(A), 42 U.S.C.

§ 7412(n)(1)(A) (emphasis added). At the time Congress

enacted the 1990 Amendments, it was possible that the Utility

Study would fail to identify significant health hazards from

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 25 of 90
26

EGU HAP emissions. (Indeed, petitioners argue that it did fail

to do so. See SIL Br. 13, 48–54.) Therefore, EPA had to

“consider[] the results of the study” in order to determine

whether regulation would be “appropriate” based on its

assessment of the existence and severity of such health hazards. 

The term “appropriate” plainly plays a role: it requires EPA to

apply its judgment in evaluating the results of the study.

Basically, petitioners and our dissenting colleague seek to

impose a requirement that Congress did not. What they ignore

is that Congress sought, as a threshold matter, to have EPA

confirm the nature of public health hazards from EGU

emissions. That is the clear focus of § 112(n)(1)(A). After that,

Congress left it to the expertise and judgment of EPA whether

or not to regulate. For EPA to focus its “appropriate and

necessary” determination on factors relating to public health

hazards, and not industry’s objections that emission controls are

costly, properly puts the horse before the cart, and not the other

way around as petitioners and our dissenting colleague urge. 

Given Congress’s efforts in the 1990 Amendments to promote

regulation of hazardous pollutants, EPA’s interpretation of

§ 112(n)(1)(A) appears consistent with Congress’s intent. 

Recall that only EGUs’ hazardous emissions were relieved of

regulation until completion of a study, and once the study

confirmed the serious public health effects of hazardous

pollutants from EGUs, Congress gave no signal that the matter

should end if remediation would be costly.

Our dissenting colleague has written a powerful-sounding

dissent. It sounds powerful, however, only because it elides the

distinction between EPA’s initial decision regarding whether to

list EGUs as sources of hazardous air pollutants, and its

subsequent decision regarding whether to issue stringent

beyond-the-floor standards for such sources. The dissent refers

to both together as the MACT “program.” Dissent at 3. But the

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 26 of 90
27

“program” in fact proceeds in two stages, as the dissent

acknowledges. It is only as to the first, listing stage that EPA

has determined it should not consider costs. That stage leads

only to the setting of the statutory MACT floor which, as the

dissent notes, is a “minimum stringency level.” Id. The second

stage leads to beyond-the-floor standards, which are more

restrictive. When setting those, EPA does consider costs.

The dissent contends that “[m]eeting that [MACT] floor

will be prohibitively expensive, particularly for many coal-fired

utilities,” forcing them “out of business.” Dissent at 10–11. But

in the Final Rule EPA rejected this contention, concluding that

“the estimated number of early retirements,” of EGUs “that may

result from this rule is . . . less than 2 percent of all U.S. coalfired capacity” in 2015. Final Rule, 77 Fed. Reg. at 9416; see

also id. at 9408 (rejecting the claim that the Final Rule “will

result in substantial power plant retirements”). Petitioners have

not challenged that conclusion. Industry respondent intervenors

further observe that continuing to exempt EGUs from HAP

regulation penalizes those plants that have made investments in

clean air technology, and that “[t]he Rule merely requires

owners of uncontrolled plants to install and operate control

technology already operating at their competitors’ plants, both

leveling the playing field and improving health and the

environment.” Indus. Resp’t Intv’nrs’ Br. 7. The Final Rule,

which, as the dissent notes, EPA has calculated will cost $9.6

billion a year, includes the cost of both stages. EPA also has

concluded under Executive Order 13563 that the annualized

benefits are $37 to $90 billion. See Final Rule, 77 Fed. Reg. at

9306. (The dissent questions this conclusion, notwithstanding

its promise that agency cost-benefit analyses should be reviewed

deferentially.) That’s “billion with a b,” in the dissent’s catchy

phrase. Dissent at 1. In short, “the benefits of this rule

outweigh its costs by between 3 to 1 or 9 to 1.” Final Rule, 77

Fed. Reg. at 9306.

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 27 of 90
28

As the agency noted, “[u]nder section 112(n)(1)(A), EPA is

evaluating whether to regulate HAP emissions from EGUs at

all.” NPRM, 76 Fed. Reg. at 24,989 (emphasis added). And

there was nothing unreasonable about its conclusion that costs

should not be considered in determining “whether HAP

emissions from EGUs pose a hazard to public health or the

environment.” Id. at 24,988; see id. at 24,990. That is

especially so when “Congress did not authorize the

consideration of costs in listing any [other] source categories for

regulation under section 112 . . . [and] did not permit the

consideration of costs in evaluating whether a source category

could be delisted pursuant to the provisions of section

112(c)(9).” Id. at 24,989. And while the dissent insists on “the

centrality of cost consideration to proper regulatory

decisionmaking,” Dissent at 6, Whitman makes clear the

Supreme Court believes that Congress does not necessarily

agree. Nor is Whitman the only case in which courts have found

that Congress legislated in a way the dissent would find

irrational.2

2 See Am. Textile Mfrs. Inst. v. Donovan, 452 U.S. 490,

511–12 (1981) (holding that OSHA is not required to conduct a costbenefit analysis in promulgating a standard under section 6(b)(5) of

the Occupational Safety and Health Act because “Congress uses

specific language when intending that an agency engage in costbenefit analysis”); Tenn. Valley Auth. v. Hill, 437 U.S. 153, 184

(1978) (“The plain intent of Congress in enacting [the Endangered

Species Act] was to halt and reverse the trend towards species

extinction, whatever the cost.”); Union Elec. Co. v. EPA, 427 U.S.

246, 257–58 (1976) (holding that EPA may not consider claims of

economic infeasibility in evaluating a state requirement that primary

ambient air quality standards be met by a certain deadline); Lead

Indus. Ass’n v. EPA, 647 F.2d 1130, 1150 (D.C. Cir. 1980) (“We are

unable to discern here any congressional intent to require, or even

permit, [EPA] to consider economic . . . factors in promulgating air

quality standards [under the CAA].”).

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 28 of 90
29

Academic generalities, see Dissent at 6–8, do not

demonstrate that EPA could not reasonably proceed as it did in

interpreting congressional intent — especially not generalities

by academics who are criticizing the Supreme Court for failing

to read congressional statutes as they do.3

 The same is true of

utterances by single Justices — especially a separate statement

by one Justice concurring in Whitman and a question by another

during oral argument about a different statutory section. See

Dissent at 6–7. Nor do the different approaches of the Bush and

Obama Administrations on the role of costs in implementing the

CAA do more than demonstrate that administrations may differ

and can change positions without legal jeopardy, so long as an

adequate explanation is provided as was done here. See

Chevron, 467 U.S. at 865–66. The question before the court is

not “Should EPA have considered costs in making its threshold

determination under § 112(n)(1)(A)?” but rather “Was EPA

required to do so at that point in its regulatory evaluation?” 

EPA has explained why it concluded costs were not part of the

“appropriate and necessary” determination, and given

Congress’s choice to leave the factors entering into that

determination to EPA, petitioners, and our dissenting colleague,

fail to demonstrate that EPA’s considered judgment about the

factors to be considered was unlawful as an impermissible and

unreasonable interpretation of § 112(n)(1)(A). Congress left to

3 See Cass R. Sunstein, Interpreting Statutes in the Regulatory

State, 103 HARV. L. REV. 405, 492–93 (1989) (criticizing American

Textile Manufacturers Institute, 452 U.S. 490, for “contributing to the

irrationality of the Occupational Safety and Health Act” by “refusing

to read the statute” as the author would); Cass R. Sunstein, CostBenefit Default Principles, 99 MICH. L. REV. 1651, 1671 (2001)

(same); Richard J. Pierce, Jr., The Appropriate Role of Costs in

Environmental Regulation, 54 ADMIN L. REV. 1237, 1253 (2002)

(criticizing the Whitman Court for relying on an “anti-cost canon”). 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 29 of 90
30

EPA “the accommodation of manifestly competing interests,”

id. at 865, and EPA did all that Congress required of it. Exactly

how and when EGU emissions are to be regulated is a different

question.

For these reasons, we hold that EPA reasonably concluded

it need not consider costs in making its “appropriate and

necessary” determination under § 112(n)(1)(A).

3. Environmental harms. Petitioners also contend that EPA

was constrained to consider only public health hazards, not

environmental or other harms, in making its “appropriate and

necessary” determination. In their view, § 112(n)(1)(A)

unambiguously forecloses the consideration of non-health

effects because the statute requires EPA to make its “appropriate

and necessary” determination after considering the results of the

Utility Study, which is focused exclusively on identifying

“hazards to public health” caused by EGU HAP emissions. See

SIL Br. 44. Petitioners insist that in 2005 EPA followed the

health-only approach. 

EPA reasoned that “nothing in the statute suggests that the

[EPA] should ignore adverse environmental effects in

determining whether to regulate EGUs under section 112.” 

NPRM, 76 Fed. Reg. at 24,988; see Final Rule, 77 Fed. Reg. at

9325. To the contrary, EPA concluded that the purpose of the

CAA and the statute’s express instruction to assess

environmental effects in the Mercury Study suggest “it is

reasonable to consider environmental effects in evaluating the

hazards posed by HAP emitted from EGUs.” NPRM, 76 Fed.

Reg. at 24,988; see Final Rule, 77 Fed. Reg. at 9325. EPA

explained in response to comments that restricting it from

considering environmental harms would “incorrectly conflate[]

the requirements for the Utility Study with the requirement to

regulate EGUs under CAA section 112 if EPA determines it is

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 30 of 90
31

appropriate and necessary to do so.” Final Rule, 77 Fed. Reg. at

9325.

EPA did not err in considering environmental effects

alongside health effects for purposes of the “appropriate and

necessary” determination. Although petitioners’ interpretation

of § 112(n)(1)(A) is plausible, the statute could also be read to

treat consideration of the Utility Study as a mere condition

precedent to the “appropriate and necessary” determination. 

EPA has consistently adopted this latter interpretation, including

in 2005. See 2005 Delisting Decision, 70 Fed. Reg. at 16,002. 

In the absence of any limiting text, and considering the context

(including § 112(n)(1)(B)) and purpose of the CAA, EPA

reasonably concluded that it could consider environmental

harms in making its “appropriate and necessary” determination. 

The court need not decide whether environmental effects alone

would allow EPA to regulate EGUs under § 112, because EPA

did not base its determination solely on environmental effects. 

As we explain, infra Part II.B.5, EPA’s decision to list EGUs

can be sustained on the basis of its findings regarding health

hazards posed by EGU HAP emissions. 

4. Cumulative impacts of HAP emissions. On the grounds

that § 112(n)(1)(A) directs EPA to study hazards reasonably

anticipated to occur “as a result of” EGU HAP emissions,

petitioners contend that EPA was required to base its

“appropriate and necessary” determination on public health

hazards that occur exclusively due to EGU HAPs. Thus, they

contend, EPA erred in considering EGU HAP emissions that

merely “contribute to” or exacerbate otherwise-occurring health

hazards. Petitioners point out that EPA’s interpretation conflicts

with its approach in 2005, when it read § 112(n)(1)(A) to

authorize regulation only upon a showing that EGU emissions

alone would cause harm. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 31 of 90
32

EPA explained that it could reasonably consider the

cumulative impacts of HAP emissions because

focusing on HAP emissions from EGUs alone when

making the appropriate finding ignores the manner in

which public health and the environment are affected

by air pollution. An individual that suffers adverse

health effects as the result of the combined HAP

emissions from EGUs and other sources is harmed,

irrespective of whether HAP emissions from EGUs

alone would cause the harm.

NPRM, 76 Fed. Reg. at 24,988; see Final Rule, 77 Fed. Reg. at

9325. EPA acknowledged it was departing from its 2005

approach, see NPRM, 76 Fed. Reg. at 24,989, but justified the

departure on grounds that the 2005 approach had been “flawed”

and “non-scientific” to the extent that “EPA [had] incorrectly

determined that U.S. EGU emissions of [mercury] did not

constitute a hazard to public health,” id. at 25,019; cf. Final

Rule, 77 Fed. Reg. at 9322–23. 

EPA’s interpretation in the Final Rule is entitled to

deference. Section 112(n)(1)(A)’s reference to hazards

occurring “as a result of” EGU HAP emissions could connote

hazards caused solely by EGU emissions, but it could also

connote hazards exacerbated by EGU emissions. EPA’s

commonsense approach to this statutory ambiguity was well

within the bounds of its discretion, and it adequately explained

its reversal from 2005. Petitioners’ contention that EPA erred

in considering the effects of HAPs emitted by non-EGU sources

is therefore unavailing. In any event, EPA concluded in the

Mercury Study that “even if there were no other sources of

[mercury] exposure, exposures associated with deposition

attributable to U.S. EGUs” would place the most susceptible

populations above the methylmercury reference dose. NPRM,

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 32 of 90
33

76 Fed. Reg. at 25,010. Thus, EPA did find, as petitioners

contend it was required to do, that EGU emissions alone would

cause health hazards.

5. Regulation under § 112(d). Petitioners contend that even

if it is “appropriate and necessary” to regulate EGU HAP

emissions, such regulation should be effected under

§ 112(n)(1)(A) to the degree appropriate and necessary — not

under § 112(d) through the imposition of MACT standards. 

They maintain that regulation of EGU HAPs that do not pose

health hazards, or regulation at a level higher than needed to

eliminate such hazards, is not regulation that is “appropriate and

necessary.” Petitioners contend that § 112(n)(1)(A)’s instruction

to “regulate electric steam generating units under this section”

(emphasis added) — rather than “under § 112(d)” — evinces

congressional intent that EGU HAPs should be regulated

differently than other sources. SIL Br. 36. 

EPA expressly considered and dismissed petitioners’

proposed interpretation. EPA concluded that the phrase “under

this section” presumptively refers to regulation under section

112, not to regulation under subparagraph 112(n)(1)(A). See

Final Rule, 77 Fed. Reg. at 9330; NPRM, 76 Fed. Reg. at

24,993. Thus, the plain statutory language suggests “EGUs

should be regulated in the same manner as other categories for

which the statute requires regulation.” Final Rule, 77 Fed. Reg.

at 9330. EPA explained:

CAA section 112 establishes a mechanism to list and

regulate stationary sources of HAP emissions. 

Regulation under CAA section 112 generally requires

listing under CAA section 112(c)[] [and] regulation

under CAA section 112(d)[.] . . . A determination that

EGUs should be listed once the prerequisite

appropriate and necessary finding is made is wholly

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 33 of 90
34

consistent with the language of section 112(n)(1)(A),

and listed sources must be regulated under CAA

section 112(d).

Id.; see also id. at 9326. 

EPA acted properly in regulating EGUs under § 112(d). 

Section 112(n)(1)(A) directs the Administrator to “regulate

electric steam generating units under this section, if the

Administrator finds such regulation is appropriate and

necessary.” CAA § 112(n)(1)(A), 42 U.S.C. § 7412(n)(1)(A). 

EPA reasonably interprets the phrase “under this section” to

refer to the entirety of section 112. See Desert Citizens Against

Pollution v. EPA, 66 F.3d 524, 527 (D.C. Cir. 2012). Under

section 112, the statutory framework for regulating HAP sources

appears in § 112(c), which covers listing, and § 112(d), which

covers standard-setting. See CAA § 112(c), 112(d), 42 U.S.C.

§ 7412(c), 7412(d). This court has previously noted that “where

Congress wished to exempt EGUs from specific requirements of

section 112, it said so explicitly.” New Jersey, 517 F.3d at 583. 

EPA reasonably concluded that the framework set forth in

§ 112(c) and § 112(d) — rather than another, hypothetical

framework not elaborated in the statute — provided the

appropriate mechanism for regulating EGUs under § 112 after

the “appropriate and necessary” determination was made. 

Therefore, EPA’s interpretation is entitled to deference and must

be upheld.

6. Regulation of all HAP emissions. In the Final Rule, EPA

claimed authority to promulgate standards for all listed HAPs

emitted by EGUs, not merely for those HAPs it has expressly

determined to cause health or environmental hazards. See, e.g.,

77 Fed. Reg. at 9325–26. Petitioners challenge this approach, 

maintaining that § 112(n)(1)(A) limits regulation to those

individual HAPs that are “appropriate and necessary” to

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 34 of 90
35

regulate. Petitioners also object that EPA’s interpretation

contradicts its 2005 rulemaking when it supported a substanceby-substance approach to regulation. 

EPA explained its disagreement with petitioners’ proposed

approach. First, EPA reiterated its view that once an

“appropriate and necessary” determination is properly made,

“EGUs should be regulated under section 112 in the same

manner as other categories for which the statute requires

regulation.” Final Rule, 77 Fed. Reg. at 9326. EPA then

reasoned that this court’s decision in National Lime, 233 F.3d at

633, “requires [EPA] to regulate all HAP from major sources of

HAP emissions once a source category is added to the list of

categories under CAA section 112(c).” Id. (emphasis added). 

In other words, EPA concluded that if EGUs are to be regulated

in the same manner as other source categories, then all HAPs

emitted by EGUs should be subject to regulation. See id.

EPA did not err by concluding that it may regulate all HAP

substances emitted by EGUs. In National Lime, 233 F.3d at

633, this court considered whether § 112(d)(1) permitted EPA

“to set emission levels only for those listed HAPs” that could be

controlled with existing technology. Concluding that EPA had

a “clear statutory obligation to set emission standards for each

listed HAP,” the court held that “the absence of technologybased pollution control devices for HCl, mercury, and total

hydrocarbons did not excuse EPA from setting emission

standards for those pollutants.” Id. at 634. Although petitioners

attempt to distinguish National Lime on grounds that it

concerned “major sources” rather than EGUs, they have not

provided any compelling reason why EGUs should not be

regulated the same way as other sources once EPA has

determined that regulation under § 112 is “appropriate and

necessary.” It also bears emphasis that the plain text of

§ 112(n)(1)(A) directs the Administrator to “regulate electric

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 35 of 90
36

utility steam generating units”—not to regulate their emissions,

as petitionerssuggest. This source-based approach to regulating

EGU HAPs was affirmed in New Jersey, 517 F.3d at 582, which

held that EGUs could not be delisted without demonstrating that

EGUs, as a category, satisfied the delisting criteria set forth in

§ 112(c)(9). The notion that EPA must “pick and choose”

among HAPs in order to regulate only those substances it deems

most harmful is at odds with the court’s precedent.

To the extent EPA’s interpretation differs from its 2005

approach, it adequately explained its decision. See Final Rule,

77 Fed. Reg. at 9325–26. Although petitioners suggest

otherwise, the 2005 Delisting Decision did not address whether

EPA could regulate all listed EGU HAPs following an

“appropriate and necessary” determination. Here, EPA offered

a reasoned explanation for its approach; no more is required. 

See Fox Television Stations, 556 U.S. at 515; Nat’l Cable &

Telecomms. Ass’n, 545 U.S. at 981. 

In view of the above, EPA’s conclusion that it may regulate

all HAP emissions from EGUs must be upheld.

III.

A.

Petitioners assert that even if EPA has correctly interpreted

§ 112(n)(1)(A), the emission standards that EPA promulgated in

the Final Rule are flawed in several respects.

1. Appropriate and necessary determination. Petitioners

first contend that the agency’s determination that it was

“appropriate and necessary” to regulate EGUs is arbitrary and

capricious. Consistent with their position on the proper

interpretation of § 112(n)(1)(A), petitioners take a HAP-by-HAP

approach to criticizing EPA’s Finding. But, as we explained

above, EPA reasonably interprets the CAA as allowing it to

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 36 of 90
37

regulate all EGU HAP emissions pursuant to the usual MACT

program once it makes the threshold “appropriate and

necessary” determination. The question then is whether EPA

reasonably found it appropriate and necessary to regulate EGUs

based on all the record evidence before it.

EPA’s “appropriate and necessary” determination in 2000,

and its reaffirmation of that determination in 2012, are amply

supported by EPA’s findings regarding the health effects of

mercury exposure. Mercury exposure has adverse effects on

human health, primarily through consumption of fish in which

mercury has bioaccumulated. See Final Rule, 77 Fed. Reg. at

9310. And EGUs are the largest domestic source of mercury

emissions. Id. Petitioners do not dispute these basic facts, but

instead take issue with whether EPA has sufficiently quantified

the contribution of EGU mercury emissions to overall mercury

exposure. Our case law makes clear, however, that EPA is not

obligated to conclusively resolve every scientific uncertainty

before it issues regulation. See Coal. for Responsible

Regulation v. EPA, 684 F.3d 102, 121 (D.C. Cir. 2012) (“If a

statute is precautionary in nature and designed to protect the

public health, and the relevant evidence is difficult to come by,

uncertain, or conflicting because it is on the frontiers of

scientific knowledge, EPA need not provide rigorous step-bystep proof of cause and effect to support an endangerment

finding.”) (internal quotation marks omitted). Instead, “[w]hen

EPA evaluates scientific evidence in its bailiwick, we ask only

that it take the scientific record into account in a rational

manner.” Id. at 122 (internal quotation marks omitted). 

EPA did so here. As explained in the technical support

document (TSD) accompanying the Final Rule, EPA determined

that mercury emissions posed a significant threat to public

health based on an analysis of women of child-bearing age who

consumed large amounts of freshwater fish. See Mercury TSD;

NPRM, 76 Fed. Reg. at 25,007; Final Rule, 77 Fed. Reg. at

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 37 of 90
38

9311–17. The design of EPA’s TSD was neither arbitrary nor

capricious; the study was reviewed by EPA’s independent

Science Advisory Board, which stated that it “support[ed] the

overall design of and approach to the risk assessment” and found

“that it should provide an objective, reasonable, and credible

determination of the potential for a public health hazard from

mercury emitted from U.S. EGUs.” SAB Letter to EPA

Administrator Jackson at 2 (Sept. 29, 2011), EPA-SAB-11-017. 

In addition, EPA revised the final TSD to address SAB’s

remaining concerns regarding EPA’s data collection practices. 

See Final Rule, 77 Fed. Reg. at 9313–16.4

Petitioners’ remaining objections center on the change in

EPA’s position between 2005 and 2012. Although petitioners

are correct that EPA weighed certain pieces of evidence

differently at different times, the agency reasonably and

adequately explained its basis for changing its position on

whether mercury emissions posed a sufficient risk to constitute

a public health hazard. See EPA Br. 40; NPRM, 76 Fed. Reg. at

25,019–20. EPA identified and analyzed what it viewed as

technical flaws in the scientific analysis supporting the 2005

Delisting Decision, including a failure to evaluate the

4

 For the reasons explained in UARG v. EPA, Nos. 12-1166,

12-1366, 12-1420, 2014 WL 928230 (D.C. Cir. Mar. 11, 2014), we do

not address petitioners’ claims that SAB’s final report on the Mercury

TSD was submitted too late to allow public comment and that EPA

unreasonably refused SAB’s request to review the final TSD. 

Petitioners did not raise those issues in comments, and reconsideration

is still pending before the agency. Even if these arguments had been

properly presented to the agency, petitioners would have forfeited

them by raising them only in a cursory footnote in their opening brief

before this court. See Hutchins v. Dist. of Columbia, 188 F.3d 531,

539 n.3 (D.C. Cir. 1999) (en banc) (“We need not consider cursory

arguments made only in a footnote”).

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 38 of 90
39

cumulative health hazard from EGU emissions when combined

with other sources of mercury, NPRM, 76 Fed. Reg. at 25,019,

and health hazards from methylmercury exposure above the

reference dose, id. at 25,020. Those explanations are sufficient

to meet the agency’s burden. See Fox Television Stations, 556

U.S. at 514–16.

2. Major source classification. Petitioners contend that in

setting emission standards for EGUs, EPA was required to

distinguish between “major sources” and “area sources.” As

relevant here, major sources are automatically subject to MACT

controls, while area sources may, in EPA’s discretion, be

regulated under alternative standards. See CAA § 112(a)(1),

112(a)(2), 112(d)(5), 42 U.S.C. § 7412(a)(1), 7412(a)(2),

7412(d)(5). Petitioners assert that EPA’s failure to segregate the

different types of sources fatally compromises the Final Rule

because the EGU emission standards should have been based

exclusively on data from major source EGUs. But § 112(d) does

not require EPA to regulate EGUs as “major sources” and “area

sources”; it merely says that, if EPA lists major and area

sources, it must then regulate them according to the separate

provisions. See CAA § 112(d)(1), 42 U.S.C. § 7412(d)(1).

EPA’s decision not to draw such a distinction here is a

reasonable one. As EPA emphasizes, distinguishing between

major source and area source EGUs runs counter to the separate

statutory provisions governing EGUs. While other sources are

classified as major or area sources depending on the quantity of

emissions they emit, § 112 specifically defines EGUs in terms

of their electrical output. Compare CAA § 112(a)(8), with CAA

§ 112(a)(1)–(2). Consistent with ordinary rules of statutory

construction, EPA reasonably relied on the more specific

definition in § 112(a)(8) rather than the general definitions

applicable to all other sources. See RadLAX Gateway Hotel,

LLC v. Amalgamated Bank, 132 S. Ct. 2065, 2070–72 (2012). 

Requiring EPA to classify EGUs as major or area sources would

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 39 of 90
40

also create redundancy in the source-category listing criteria. 

Section 112(c)(3) of the CAA requires EPA to list area sources

for regulation if EPA determines that they “warrant[]

regulation.” CAA § 112(c)(3), 42 U.S.C. § 7412(c)(3). That

finding is arguably unnecessary as applied to EGUs given the

requirement in § 112(n)(1)(A) that EPA make a finding that

regulation of all EGUs is “appropriate and necessary.”

EPA also did not err in declining to exercise its

discretionary authority to require less stringent “generally

available control technology,” or GACT, standards, rather than

MACT standards. Id. § 112(d)(5), 42 U.S.C. § 7412(d)(5). In

the Final Rule, EPA expressly and reasonably determined that

setting separate GACT standards for area source EGUs was

unnecessary. See Final Rule, 77 Fed. Reg. at 9404, 9438

(“[S]imilar HAP emissions and control technologies are found

on both major and area sources” such that “there is no essential

difference between area source and major source EGUs with

respect to emissions of HAP.”).

For these reasons, EPA reasonably declined to interpret

§ 112 as mandating classification of EGUs as major sources and

area sources.

3. Mercury MACT floor. Petitioners next challenge EPA’s

standards for mercury emissions from existing coal-fired EGUs. 

Petitioners maintain that in calculating the MACT floor for

those units, EPA collected emissions data from only those EGUs

that were best-performing for mercury emissions. 

Consequently, petitioners insist, the mercury MACT standard

reflects the results achieved by the “best of the best” EGUs, and

not the results of the best 12% of all EGUs, as required by

statute.

Petitioners’ assertions of a biased or irrational data

collection process are not supported by a review of the record. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 40 of 90
41

“EPA typically has wide latitude in determining the extent of

data-gathering necessary to solve a problem.” Sierra Club v.

EPA, 167 F.3d 658, 662 (D.C. Cir. 1999). Here, EPA

determined that a three-pronged approach was appropriate for

developing the mercury MACT standard. First, EPA asked all

EGUs for all of their data from 2005–10; it received data from

168 units. Information Collection Request (“ICR”) Supporting

Statement Part A at 9; see generally MACT Floor Analysis

Spreadsheets. Second, EPA requested and received data from

50 randomly selected EGUs. ICR Supporting Statement Part B

at 2, 7–8. Finally, EPA requested and received data from 170 of

the best-performing units for non-mercury emissions. Id. EPA

initially thought that third group would also be the bestperforming for mercury emissions, but it discovered that was not

the case after examining the data. See Responses to Comments,

Dec. 2011, v.1, at 573–76 (“RTC”).

Based on the results of its ICR, covering a total of 388

EGUs, EPA chose “the average emission limitation achieved by

the best performing 12 percent” of all existing sources “for

which [it] ha[d] emissions information,” as authorized by CAA

§ 112(d)(3)(A). See NPRM, 76 Fed. Reg. at 25,022–23. 

Although, as EPA acknowledges, it would be arbitrary and

capricious for EPA to set a MACT floor based on intentionally

skewed data, the facts indicate that EPA did not do so here. Nor

does the record suggest that EPA’s data collection efforts

resulted in unintentional bias. As previously noted, EPA

collected data from a wide range of EGUs because the agency

concluded that it could not identify units representing the bestperforming 12 percent of mercury emitters. That conclusion is

borne out by the data in the record, which showed that some of

the best-performing units for particulate matter control were

among the worst performing units for mercury control. See

generally MACT Floor Analysis Spreadsheets. Similarly, many

of the mercury best performers (32 of the best performing 126

units) were not drawn from the pool of units that EPA targeted

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 41 of 90
42

as best performers for particulate matter. See RTC v. 1 at 575. 

In short, EPA’s data-collection process was reasonable, even if

it may not have resulted in a perfect dataset. 

4. Acid gas HAP. EPA did not conclusively determine that

emissions of acid gases such as hydrogen chloride from EGUs

pose a health hazard. See NPRM, 76 Fed. Reg. at 25,016 (“our

case studies did not identify significant chronic non-cancer risks

from acid gas emissions”). Petitioners say that given that

conclusion, EPA should have established a less stringent, healthbased emission standard for acid gases under § 112(d)(4). That

provision states: “With respect to pollutants for which a health

threshold has been established, the Administrator may consider

such threshold level, with an ample margin of safety, when

establishing emission standards under this subsection.” CAA

§ 112(d)(4), 42 U.S.C. § 7412(d)(4). Section 112(d)(4) makes

clear, however, that EPA’s authority to set alternate standards is

discretionary. See id. (“the Administrator may consider such

threshold level”) (emphasis added). Here, EPA concluded that

it lacked enough evidence to determine whether an alternative

standard would protect health “with an ample margin of safety.” 

See Final Rule, 77 Fed. Reg. at 9405–06. Petitioners dispute

EPA’s weighing of the evidence, but petitioners offer no

compelling basis for second-guessing EPA’s analysis.

Petitioners also suggest that regulation of EGU acid gas

emissions to address ecosystem acidification conflicts with

Congress’s decision in the 1990 CAA amendments to address

such acidification in Title IV of the CAA. See SIL Reply Br. 5. 

But petitioners failed to raise that argument before the agency,

and did not raise it in this court until their reply brief. We

therefore deem the argument forfeited. See Bd. of Regents of

Univ. of Washington v. EPA, 86 F.3d 1214, 1221 (D.C. Cir.

1996).

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 42 of 90
43

5. UARG delisting petition. The Utility Air Regulatory

Group (UARG) filed a petition with EPA seeking to remove

coal-fired EGUs from the list of sources regulated under § 112. 

EPA denied the petition. Petitioners now argue that that denial

was arbitrary and capricious for the same reasons they assert that

the agency’s determination that it is “appropriate and necessary”

to regulate EGUs was incorrect. Assuming, without deciding,

that EPA can delist only a subset of the EGU source category,

we reject petitioners’ argument on this point. As EPA explained

in the Final Rule, UARG’s delisting petition did not demonstrate

that EPA could make either of the two predicate findings

required for delisting under § 112(c)(9)(B): (1) that no source in

the category emits HAP “in quantities which may cause a

lifetime risk of cancer greater than one in one million to the

individual in the population who is most exposed” and (2) that

emissions from no source in the category “exceed a level which

is adequate to protect public health with an ample margin of

safety.” CAA § 112(c)(9)(B), 42 U.S.C. § 7412(c)(9)(B); see

also Final Rule, 77 Fed. Reg. at 9364–65 (discussing technical

flaws in UARG’s risk analysis).

6. Chromium emissions data. Finally, petitioners question

the validity of EPA’s case study regarding risks from nonmercury EGU emissions. As relevant here, that study found that

at 6 of 16 tested facilities, emissions of HAP posed a lifetime

cancer risk of more than one in a million to the most exposed

individuals. See Final Rule, 77 Fed. Reg. at 9319. Petitioners

contend that EPA’s cancer-risk finding was the product of

contaminated emissions samples, and that EPA has refused to

correct the emissions data it used. In making this argument,

they rely on their own independent “subsequent resampling” of

the facilities that EPA examined in conducting its inhalation risk

assessment. SIL Br. 52 n.58; UARG, Petition for

Reconsideration of MATS Rule at 6–7 (Apr. 16, 2012), EPAHQ-OAR-2009-0234-20179 (J.A. 2493–94).

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 43 of 90
44

EPA did not act arbitrarily or capriciously in relying on the

chromium emissions data to which petitioners object. As EPA

explained in its responses to comments, the data came from

source representatives themselves. RTC v.1 at 187. EPA

reasonably believed that these representatives — given their

“concern[] about data accuracy” — would review “all data

before certifying their accuracy and submitting them to the

EPA.” Id. EPA did not err in relying on this certified data. We

cannot consider the data from petitioners’ independent

resampling, which was conducted after the Final Rule issued and

was not part of the administrative record. See CAA

§ 307(d)(7)(A), 42 U.S.C. § 7607(d)(7)(A). 

B.

A group of electric utilities and industry groups have filed

a separate petition raising issues specific to industry. Many of

industry petitioners’ arguments concern circulating fluidized bed

EGUs, or CFBs. As relevant here, CFBs differ from

conventional pulverized coal units in that CFBs inject air and

additional materials, such as limestone, into the combustion

zone in order to achieve lower-temperature combustion. At that

lower temperature, fuel breaks down to a lesser degree, thus

enabling CFBs to control emissions without using add-on

controls.

Industry petitioners argue that these design differences

required EPA to create a separately regulated subcategory for

CFBs. They emphasize that EPA recognized the need for a CFB

subcategory in a different rulemaking proceeding, the “Boiler

MACT” Rule.

Industry petitioners’ CFB-related arguments are unavailing. 

Contrary to industry petitioners’ assertions, nothing in the Clean

Air Act “requires” EPA to create a CFB subcategory. Rather,

the statute gives EPA substantial discretion in determining

whether subcategorization is appropriate. See CAA § 112(d)(1),

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 44 of 90
45

42 U.S.C. § 7412(d)(1) (EPA “may distinguish among classes,

types, and sizes of sources”) (emphasis added); see also Nat’l

Ass’n of Clean Water Agencies v. EPA, 734 F.3d 1115, 1159

(D.C. Cir. 2013) (“EPA’s subcategorization authority under

§ 112 involves an expert determination, placing a heavy burden

on a challenger to overcome deference to EPA’s articulated

rational connection between the facts found and the choice

made.”) (internal quotation marks omitted). EPA’s decision not

to create a CFB subcategory in the Final Rule is reasonable and

well-supported by the record. Among other things, EPA noted

that CFBs were among the best and worst performers for various

pollutants, indicating that CFBs have emissions profiles similar

to other coal-fired units despite their operational differences. 

See Final Rule, 77 Fed. Reg. at 9397.

The record similarly supports EPA’s determination that the

0.002 lb/MMBtu hydrogen chloride limit for CFBs is

achievable. As noted above, some CFB units were among the

top performers for each of the regulated pollutants, including

hydrogen chloride. See id. The record thus demonstrates that at

least some CFB units are in fact able to achieve the hydrogen

chloride limit. In any event, the fact that the Final Rule may not

be cost effective for all CFBs does not necessarily mean EPA

erred in declining to create a CFB subcategory or in setting

emission standards applicable to those units.

EPA’s decision to subcategorize CFBs in the Boiler MACT

Rule is not to the contrary. There, EPA concluded that CFBs

presented relevant differences with respect to carbon monoxide

— not mercury, acid gases, or particulates (the pollutants at

issue in this rulemaking). See National Emission Standards for

Hazardous Air Pollutants for Major Sources: Industrial,

Commercial, and Institutional Boilers and Process Heaters, 76

Fed. Reg. 15,608, 15,617–18 (Mar. 21, 2011).

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 45 of 90
46

Industry petitioners further argue that at a minimum, EPA

should have set separate acid gas standards for coal-refuse-fired

CFBs. Those units burn waste coal from other coal-mining

operations and use the resulting ashes in mine reclamation

projects. Industry petitioners maintain that these fuel-ash reuse

efforts would be imperiled by the stringency of the acid gas

standards in the Final Rule.

We conclude that EPA reasonably decided that separate

standards for coal-refuse-fired CFBs were not warranted. 

Industry petitioners’ assertion that the hydrogen chloride

standards are unattainable for coal-refuse-fired CFBs is

undermined by the fact that some of those units were among the

best performers for hydrogen chloride. See RTC v.1 at 587. 

EPA also suggested alternative compliance methods that it says

would permit coal-refuse-fired CFBs to continue participating

in reclamation efforts. See Final Rule, 77 Fed. Reg. at 9412. 

Regardless, nothing in the CAA obligates EPA to set standards

in a way that always allows the re-use of fuel ash, even if doing

so might be a more desirable outcome for some EGU operators. 

C.

In contrast to its decision on CFBs, EPA did create a

subcategory for lignite-fired EGUs. (Lignite coal is also

referred to as “low rank” coal due to its low heat content.) 

Industry petitioners argue that the emission standard for the

lignite subcategory is based on an improperly calculated

minimum stringency level, or MACT floor. Industry petitioners

also contend that the emission standard set by EPA is not

achievable. We consider these arguments in turn. 

1. MACT floor. Industry petitioners insist that EPA

incorrectly calculated the MACT floor for lignite units,

rendering that standard arbitrary and capricious. They assert

that EPA used “cherry picked” data from the top 6% of units,

instead of the top 12% as required by § 112(d)(3)(A). Finally,

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 46 of 90
47

industry petitioners argue that EPA did not properly account for

variability in lignite coal.

Industry petitioners’ data-bias argument is similar to the

argument made by the State, Industry & Labor petitioners

regarding the mercury MACT floor, supra Part III.A.3. And, as

with that argument, petitioners’ assertions regarding the lignite

MACT floor find no support in the record. EPA has offered a

reasonable, non-biased explanation of its data-collection and

analysis process. See MACT Floor Memo at 10; RTC v.1 at

559–60.

Industry petitioners’ objections regarding the variability of

lignite coal likewise fail. EPA accounted for variability due to

differing chemical compositions of coal by applying its Upper

Prediction Limit analysis. See NPRM, 76 Fed. Reg. at 25,041. 

Industry petitioners do not challenge that analysis itself. They

do suggest in passing that EPA’s results are flawed, see Industry

Pet’rs’ Br. 10, but offer no explanation as to why that is so. 

Such cursory treatment is inadequate to place their challenge to

EPA’s variability analysis before the court, because “it is not

enough merely to mention a possible argument in the most

skeletal way, leaving the court to do counsel’s work, create the

ossature for the argument, and put flesh on its bones.” Davis v.

Pension Benefit Guar. Corp., 734 F.3d 1161, 1166–67 (D.C. Cir.

2013) (internal quotation marks and alterations omitted). While

EPA acknowledged that it could not account for all operational

variability, it concluded that its variability analysis “is an

appropriate method of addressing the concern that these

standards must be met at all times.” RTC v.1 at 458. EPA’s

explanation is sufficient to withstand our “extremely

deferential” review of this kind of technical judgment. New

York v. Reilly, 969 F.2d 1147, 1152 (D.C. Cir. 1992).

2. Beyond-the-floor limit. EPA is permitted to set a more

restrictive, “beyond-the-floor” emission standard if the agency

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 47 of 90
48

determines that such a standard is “achievable” considering

costs, energy requirements, and applicable control technologies. 

CAA § 112(d)(2), 42 U.S.C. § 7412(d)(2). To be “achievable,”

a standard “must be capable of being met under most adverse

conditions which can reasonably be expected to recur.” Nat’l

Lime Ass’n v. EPA, 627 F.2d 416, 431 n.46 (D.C. Cir. 1980). In

this case, industry petitioners argue that EPA failed to consider

the limitations of applicable control technologies. As a result,

petitioners contend, EPA’s beyond-the-floor standard for lignitefired EGUs is not achievable because the standard mandates

unrealistically high levels of mercury reduction.

We reject petitioners’ challenge to the beyond-the-floor

standard. EPA concluded during the rulemaking process that the

standard for lignite units is achievable if sources increase their

use of a particular control technology, activated carbon

injection. See Beyond-the-Floor Memo at 1–4. According to

EPA, increased carbon injection can reduce emissions by up to

90%, well in excess of the reductions necessary to reach

beyond-the-floor levels. Id. at 1–2. Ultimately, the dispute on

this issue amounts to a factual disagreement between EPA and

petitioners over the effectiveness of activated carbon injection. 

Because the record contains no data inconsistent with EPA’s

position on the efficacy of activated carbon injection, we defer

to the agency’s determination that the beyond-the-floor emission

standard for lignite-fired EGUs is achievable.

D.

Public utility companies are subject to certain state-law

contracting requirements that may lengthen the process of

installing upgraded controls. That added time, industry

petitioners argue, requires EPA to grant a blanket, one-year

extension of the compliance deadline to public power

companies. We disagree. Once again, petitioners’ argument

amounts to a claim that a decision the Clean Air Act leaves to

EPA’s discretion should instead be mandatory. See CAA

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 48 of 90
49

§ 112(i)(3)(B), 42 U.S.C. § 7412(i)(3)(B) (EPA “may issue” an

extension under certain circumstances). EPA explained at

length why such a blanket extension was inappropriate. See

Final Rule, 77 Fed. Reg. at 9407, 9409–11. Most importantly,

industry petitioners did not show — and likely could not show

— that an extension is necessary for the installation of controls

at every public power company. On the contrary, EPA’s data

indicated that “most units will be able to fully comply” within

the three-year period established by EPA. Final Rule, 77 Fed.

Reg. at 9410. EPA’s decision not to issue a blanket extension

therefore was not arbitrary or capricious.5

IV.

 We turn to the challenges by Environmental petitioners and

Julander Energy Company.

A.

Environmental petitioners challenge the provisions of the

Final Rule that allow compliance with emission standards to be

demonstrated through (1) emissions averaging and (2) options

for non-mercury metal HAP emissions monitoring. Chesapeake

Climate Action Network, Conservation Law Foundation,

Environmental Integrity Project, and Sierra Club object to

5

 To the extent that petitioners object to EPA’s alleged failure

to respond to comments on this issue made by public power

companies on the ground that this failure violates CAA

§ 307(d)(6)(B), 42 U.S.C. § 7607(d)(6)(B), we do not address that

objection because it was first raised in a pending petition for

reconsideration. See UARG, 2014 WL 928230, at *4. We also do not

address industry petitioners’ arguments concerning the standards for

petroleum-coke-fired EGUs and liquid oil-fired non-continental EGUs

because those arguments were likewise first raised in a pending

petition for reconsideration.

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 49 of 90
50

averaging as unlawful; Chesapeake Climate Action Network and

Environmental Integrity Project object to the monitoring options

as failing to provide reasonable assurance of compliance. They

presented their objections (save one) during the comment period

and EPA has responded to them. Although the challenges to

emissions averaging are also pending before EPA in a petition

for reconsideration, and usually would be incurably premature,

see, e.g., Clifton Power Corp. v. FERC, 294 F.3d 108, 112 (D.C.

Cir. 2002), the text and legislative history of the Clean Air Act

make clear this usual approach is inapplicable, see UARG v.

EPA, Nos. 12-1166, 12-1366, 12-1420, 2014 WL 928230, at *3

(D.C. Cir. Mar. 11, 2014); CAA § 307(b)(1), 42 U.S.C.

§ 7607(b)(1); S. REP. NO. 101-228, at 3755 (1989).

1. Averaging. Under the Final Rule, existing contiguous,

commonly-controlled EGUs in the same subcategory can

demonstrate compliance by averaging their emissions as an

alternative to meeting certain requirements on an individual

basis. Final Rule, 77 Fed. Reg. at 9384, 9473–76 (codified at 40

C.F.R. § 63.10009). Averaging is permissible only between the

same types of pollutants, individual EGUs that are part of the

same affected source, EGUs subject to the same emission

standard, and existing (not new) EGUs. Id. at 9385. Each

facility intending to use emissions averaging must develop an

emissions averaging plan identifying “(1) [a]ll units in the

averaging group; (2) the control technology installed; (3) the

process parameter that will be monitored; (4) the specific control

technology or pollution prevention measure to be used; (5) the

test plan for the measurement of the HAP being averaged; and

(6) the operating parameters to be monitored.” Id. at 9385–86.

Environmental petitioners contend the averaging alternative

is unlawful because it relaxes the stringency of the MACT floor

standards. With one exception, EPA set the MACT floor

standards based on a thirty-boiler operating day averaging

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 50 of 90
51

period. Id. at 9385, 9479–80. Allowing multiple EGUs to

average their emissions data effectively extends, petitioners

maintain, the standards’ averaging period to sixty days (for two

units), ninety days (for three units), or more. In their view, a

longer averaging period permits longer and larger pollution

spikes because high measurements can be averaged over more

hours of normal, lower-pollution operations.

Section 112(d)(3), 42 U.S.C. § 7412(d)(3), provides that

emission standards for existing sources “shall not be less

stringent” than “the average emission limitation achieved by the

best performing 12 percent” of such sources. The subsection

(d)(2) “beyond-the-floor” requirement provides that emission

standards for new or existing sources “shall require the

maximum degree of reduction in emissions of the hazardous air

pollutants subject to this section . . . that the Administrator . . .

determines is achievable.” CAA § 112(d)(2), 42 U.S.C.

§ 7412(d)(2).

EPA permissibly interpreted § 112(d) to allow emissions

averaging as provided for in the Final Rule. See Chevron, 467

U.S. at 843. That section neither expressly allows nor disallows

emissions averaging among multiple units. In the Final Rule,

EPA stated: 

Averaging across affected units is permitted only if it

can be demonstrated that the total quantity of any

particular HAP that may be emitted by that portion of

a contiguous major source that is subject to the same

standards in the [Final Rule] will not be greater under

the averaging mechanism than it could be if each

individual affected EGU in the subcategory complied

separately with the applicable standard. Under this

test, the practical outcome of averaging is equivalent to

compliance with the MACT floor limits by each

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 51 of 90
52

discrete EGU, and the statutory requirement that the

MACT standard reflect the maximum achievable

emissions reductions is, therefore, fully effectuated.

77 Fed. Reg. at 9385. Viewing averaging as “an equivalent,

more flexible, and less costly alternative” to requiring units to

demonstrate compliance individually, EPA explained that

permitting averaging is part of its “general policy of

encouraging the use of flexible compliance approaches where

they can be properly monitored and enforced.” Id.

Environmental petitioners concede the averaging alternative

will not result in an increase in a source’s total emissions

beyond the level permitted under the applicable standard, see

Envtl. Pet’rs’ Br. 18, and while theoretically averaging could

allow an individual unit’s emissions to exceed the standard,

under the Final Rule that exceedance must be offset by other,

better-performing units to demonstrate compliance. They have

not challenged EPA’s interpretation of the ambiguous term

“source,” which EPA defined as referring to “the collection of

coal- or oil-fired EGUs . . . within a single contiguous area and

under common control,” Final Rule, 77 Fed. Reg. at 9366, rather

than a single EGU. Because § 112(d)(3), 42 U.S.C.

§ 7412(d)(3), requires EPA to prescribe emissions limitations

for “sources,” not units, EPA could permissibly establish a

standard that allows averaging within a single source. Cf.

Chevron, 467 U.S. at 866. Although this may allow individual

units to exceed the emissions limitation, the statute does not

require EPA to regulate emissions on a unit level.

As EPA has observed, Environmental petitioners’ main

objection appears to be that the Final Rule does not include a

“discount factor” whereby emission rates are reduced for

sources using an averaging alternative. Petitioners point, for

example, to the discount factor included in the Hazardous

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 52 of 90
53

Organic NESHAP rule, Envtl. Pet’rs’ Br. 9–10, in which EPA

determined that “to carry out the mandate of section 112(d)(2),

some portion of these cost savings [from averaging] should be

shared with the environment by requiring sources using

averaging to achieve more emission reductions than they would

otherwise.”6

To the extent petitioners’ objection is that EPA failed to

explain why it did not include a discount factor, EPA, in fact,

offered a reasonable and adequate explanation. In the Final

Rule, EPA explained that “[g]iven the homogeneity of fuels

within the rules subcategories, along with other emissions

averaging criteria, the Agency believes use of a discount factor

to be unwarranted for this rule.” Final Rule, 77 Fed. Reg. at

9386. Further, in responding to comments, EPA explained that

unlike the Hazardous Organic rule, “which covers a broad

number of unit types, products, and processes,” EGUs subject to

the Final Rule “differ generally only in the fuel used to produce

electricity,” a difference, EPA concluded, “accounted for . . . by

prohibiting units from differing subcategories — which are fuel

based — from participating in emissions averaging.” RTC v.2

at 361–62. EPA noted as well its agreement that “other safety

factors in the rule obviate the need for a discount factor,” id. at

363, including the requirement averaging start within three years

of promulgation of the Final Rule.

The suggestion by Environmental petitioners that EPA

improperly relied on its Upper Prediction Limit (“UPL”)

6 National Emission Standards for Hazardous Air Pollutants

for Source Categories; Organic Hazardous Air Pollutants from the

Synthetic Organic Chemical Manufacturing Industry and Other

Processes Subject to the Negotiated Regulation for Equipment Leaks,

59 Fed. Reg. 19,402, 19,430 (Apr. 22, 1994).

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 53 of 90
54

analysis to mitigate the effect of averaging on the stringency of

emission standards fares no better. The UPL analysis in the

MACT floor calculation is designed to “assess variability of the

best performers.” NPRM, 76 Fed. Reg. at 25,041. To the extent

petitioners point to EPA’s statement in responding to comments,

they ignore its context. EPA stated that it “disagrees with the

suggestion that another variability component need be

considered for those EGU owners or operators who choose to

engage in emissions averaging; the current UPL analyses was

[sic] developed to take factors such as those mentioned by the

commenter into account.” RTC v.2 at 363. According to

Environmental petitioners, “the UPL analyses contain nothing

that would eliminate (or even mitigate) the Averaging

Alternative’s additional relaxation of the standards,” and it was

therefore inappropriate for EPA to rely on this analysis in

support of the Final Rule’s emissions averaging provisions. 

Envtl. Pet’rs’ Br. 20. But there is nothing to indicate this is what

EPA did. In its statement, EPA was responding to industry

comments arguing that because EPA had accounted for

individual-unit variability in the UPL analysis in setting MACT

floors, it was inappropriate to allow a multi-unit facility to

further reduce variability by averaging, without applying a

discount factor. It is far too great a stretch to read EPA’s

response as an admission that EPA relied on its UPL analysis to

support emissions averaging. 

2. Monitoring. The Final Rule provides three alternatives

to continuous emissions monitoring to demonstrate compliance

with the non-mercury metal HAP standards. They are: (1) use

of a continuous parametric monitoring system (“CPMS”), (2)

quarterly performance testing, and (3) performance testing once

every three years for qualifying low emitting EGUs. See Final

Rule, 77 Fed. Reg. at 9466 (codified at 40 C.F.R.

§ 63.10000(c)(1)(iii-iv)). Environmental petitioners first

challenged CPMS in a pending petition for reconsideration, and

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 54 of 90
55

therefore that challenge is not properly before the court for

decision now. See UARG, 2014 WL 928230, at *4, *5 n.4.

Any EGU may demonstrate compliance with the nonmercury metal standards through quarterly performance tests. 

Final Rule, 77 Fed. Reg. at 9372, 9384, 9466. If a unit’s

emission results for all required tests are less than 50 percent of

the applicable emission limit for a three-year period, the EGU

may qualify as a low emitting EGU for non-mercury metal

HAPs and is then required to conduct performance testing only

once every three years, so long as it maintains compliance. Id.

at 9371, 9466, 9471.

Environmental petitioners maintain that stack testing

conducted quarterly or once every three years cannot provide

reasonable assurance of compliance with a standard set as a

thirty-day emissions rate, given EPA’s determination that stack

test results are highly variable, and that EPA has failed to

explain how compliance options involving long intervals

between performance tests and lacking any control of operating

conditions between tests can provide sufficiently timely or

reliable information to assure compliance. EPA has provided a

reasonable explanation for its determination that each of these

monitoring options complies with the statutory requirements of

CAA §§ 114 and 504.

Section 504(b), 42 U.S.C. § 7661c(b), provides that 

“continuous emissions monitoring need not be required if

alternative methods are available that provide sufficiently

reliable and timely information for determining compliance.” 

Although § 114(a)(3), 42 U.S.C. § 7414(a)(3), “require[s]

enhanced monitoring” for major stationary sources, there is “no

presumption in favor of any particular type of monitoring.” 

Sierra Club, 353 F.3d at 991. EPA has “broad discretion in

selecting a monitoring regime that ensures compliance,” and as

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 55 of 90
56

long as it “reasonably articulate[s] the basis for its decision,” id.,

the court will “defer to the informed discretion of the Agency,”

recognizing that “analysis of this issue requires a high level of

expertise,” id. (quoting Nat’l Lime, 233 F.3d at 635).

EPA explained that, in its judgment, “[t]he quarterly stack

testing period, coupled with underlying monitoring of control

devices or the additional monitoring for liquid oil-fired units, is

expected to be frequent enough to ensure that a unit’s emissions

control devices and processes continue to operate in the same

manner as during the previous stack test.” RTC v.2 at 93. “If

there are significant changes to the operation of the unit or the

fuel, then a retest is required to reconfirm that the source

remains in compliance under the new operating circumstances.” 

Id. EPA acknowledged, with respect to the low emitting EGU

option, that the available data “shows an EGU’s potential

variability,” but reasoned that “well-operated EGUs — such as

those qualifying for [low emitting EGU] status — are expected

to have much less variable emissions” and that “the requirement

to revert to the original monitoring frequency should subsequent

emissions testing show the EGUs no longer meet [low emitting

EGU] status will keep source owners or operators interested in

maintaining [that] status.” Id. at 244. EPA has provided a

reasonable explanation for its determinations that these two

monitoring options provide sufficient assurance of compliance

with the applicable emission standards. 

B.

Julander Energy Company, an oil and natural gas

development, exploration, and production company, challenges

EPA’s decision not to adopt stricter emission standards by

requiring “fuel switching” by EGUs from coal to natural gas. It

contends that EPA unlawfully relied on a non-statutory factor

(prohibition of construction of new coal-fired EGUs), failed to

consider a required statutory factor (§ 112’s requirement that

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 56 of 90
57

EPA consider collateral benefits of control options), and reached

arbitrary and capricious conclusions about natural gas supply

and infrastructure and costs.

As a threshold matter, the court must address Julander’s

standing. Industry intervenor-respondents contend Julander

lacks standing under Article III of the Constitution. In fact,

Julander’s “injury in fact,” causation, and redressability under

Article III, see Lujan v. Defenders of Wildlife, 504 U.S. 555,

560–61 (1992), are self-evident, see Sierra Club v. EPA, 292

F.3d 895, 899–900 (D.C. Cir. 2002), insofar as the Final Rule

does not require EGUs to switch to natural gas, to the detriment

of Julander’s stated interests, and on remand EPA could require

fuel switching. EPA, however, contends Julander lacks

“prudential standing” because its interests do not come within

the zone-of-interests test articulated in Association of Data

Processing Service Organizations, Inc. v. Camp, 397 U.S. 150

(1970). The Supreme Court recently clarified that “‘prudential

standing is a misnomer’ as applied to the zone-of-interests

analysis,” Lexmark Int’l, Inc. v. Static Control Components,

Inc., No. 12-873, 2014 WL 1168967, at *6 (U.S. Mar. 25, 2014)

(quoting Ass’n of Battery Recyclers, Inc. v. EPA, 716 F.3d 667,

675–76 (D.C. Cir. 2013) (Silberman, J., concurring)). The

question remains whether Julander’s interest is “arguably within

the zone of interests to be protected or regulated by the statute.” 

Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians v.

Patchak, 132 S. Ct. 2199, 2210 (2012) (quoting Ass’n of Data

Processing, 397 U.S. at 153).

Although the zone-of-interests test “is not meant to be

especially demanding,” Clarke v. Secs. Indus. Ass’n, 479 U.S.

388, 399 (1987), we conclude that Julander falls outside the

zone of interests protected by § 112 of the CAA. 

Notwithstanding our concurring colleague’s suggestion, this

conclusion is not the result of a “coin flip” to decide which of

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 57 of 90
58

our precedents to follow. Concurring Op. at 17, 29. The

Supreme Court has instructed that “the breadth of the zone of

interests varies according to the provisions of law at issue.”

Lexmark, 2014 WL 1168967, at *8 (citation omitted). 

Accordingly, this court must be guided by those of our

precedents that have interpreted § 112, and not those applying

other statutory provisions, including the APA. Those cases hold

in the context of challenges to emission standards that

competitors of regulated parties fall outside the zone of interests

protected by § 112.

In Association of Battery Recyclers, 716 F.3d at 674, the

court held that a corporation could not challenge EPA’s failure

to impose more stringent emission standards on its competitors

because that interest fell outside the zone of interests protected

by § 112. In Cement Kiln Recycling Coalition v. EPA, 255 F.3d

855, 871 (D.C. Cir. 2001), the court similarly held that the

purely commercial interests of manufacturers of pollution

control equipment seeking more rigorous regulation of their

competitors under § 112 were not within the zone of interests

that Congress intended to be relied upon to challenge EPA’s

claimed disregard of the CAA. This was so even though their

pecuniary interests in increasing demand for their products were

aligned with the goals of the CAA. The court explained that

Congress’s evident purpose in enacting the CAA was not to

compel those sources with less-than-best pollution control to

invest in upgraded equipment, but only to meet the standards, as

distinct from adopting the methods of emission control, of the

best performing sources. Id. This court has not read the

Supreme Court’s decision in Match-E-Be-Nash-She-Wish Band

of Pottawatomi Indians, 132 S. Ct. 2199, to change the zone-ofinterests standard, and the court is bound to follow its own

precedent. See Grocery Mfrs. Ass’n v. EPA, 693 F.3d 169, 179

(D.C. Cir. 2012); id. at 180 (Tatel, J., concurring).

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 58 of 90
59

Julander disputes that it is seeking a competitive advantage

by increasing the regulatory burden on its competitors, pointing

out that as an oil and natural gas development company it is not

a direct competitor of the regulated coal- and oil-fired EGUs. It

maintains that it is properly characterized as a vendor to, and not

a competitor of, the regulated entities. Nonetheless, the

reasoning of our binding precedent encompasses Julander’s

situation. As the court observed in Hazardous Waste Treatment

Council v. EPA, 861 F.2d 277, 282 (D.C. Cir. 1988), where the

Treatment Council, much like Julander, claimed its interests,

although pecuniary, were “in sync” with those sought to be

served by the Resource Conservation and Recovery Act, the

Supreme Court’s standard in Clarke “leaves the status of this

sort of incidental benefit somewhat unclear.” In “find[ing]

operational meaning for a test that demands less than a showing

of congressional intent to benefit but more than a ‘marginal[]

rela[tionship]’ to the statutory purposes,” id. at 283 (quoting

Clarke, 479 U.S. at 399), this court acknowledged that even

absent an apparent congressional intent to benefit there may still

be “some indicator that the plaintiff is a peculiarly suitable

challenger of administrative neglect [to] support[] an inference

that Congress would have intended eligibility,” id. But the court

rejected the notion that the petitioner’s “in sync” interests were

more than “marginally related” to Congress’s environmental

purposes. Id.

Whenever Congress pursues some goal, it is inevitable

that firms capable of advancing that goal may benefit. 

If Congress authorized bank regulators to mandate

physical security measures for banks, for example, a

shoal of security services firms might enjoy a profit

potential — detective and guard agencies,

manufacturers of safes, detection devices and small

arms, experts on entrance control, etc. But in the

absence of either some explicit evidence of an intent to

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 59 of 90
60

benefit such firms, or some reason to believe that such

firms would be unusually suitable champions of

Congress’s ultimate goals, no one would suppose them

to have standing to attack regulatory laxity. And of

course a rule that gave any such plaintiff standing

merely because it happened to be disadvantaged by a

particular agency decision would destroy the

requirement of prudential standing; any party with

constitutional standing could sue.

Id. (emphasis added). In Cement Kiln, 255 F.3d at 871, the court

embraced this analysis as no less applicable to the CAA. The

court has further observed that “judicial intervention may defeat

statutory goals if it proceeds at the behest of interests that

coincide only accidentally with those goals,” Hazardous Waste,

861 F.2d at 283, and that “open-ended emissions standards” are

particularly susceptible to such “manipulation,” Honeywell Int’l

Inc. v. EPA, 374 F.3d 1363, 1371 (D.C. Cir. 2004).

Ethyl Corp. v. EPA, 306 F.3d 1144 (D.C. Cir. 2002), is of

no aid to Julander. In that case, the court held that a

manufacturer of fuel additives seeking information (through an

open process for testing emissions control systems) in order to

comply with its own regulatory obligations fell within the zone

of interests protected or regulated by the CAA. See id. at 1148. 

Ethyl had an interest that “appear[ed] congruent with those of

the [CAA], i.e., the development of products that will reduce

harmful air pollutants,” id., without the potential for distortion

of the regulatory process of concern to the court in Hazardous

Waste, 861 F.2d at 285, and Cement Kiln, 255 F.3d at 871. 

Unlike petitioners seeking to increase the regulatory burden on

others in order to advance their own commercial interests, Ethyl

sought access to information to “improve its products with an

eye to conformity to emissions needs” and to “secur[e] EPA

approval for its own fuel additive products under the [Clean Air]

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 60 of 90
61

Act.” Ethyl Corp., 306 F.3d at 1147–48. The court emphasized

“the interdependence between motor vehicle certification under

the Act (the process at stake here) and fuel regulations (under

which Ethyl is a direct regulatee).” Id. at 1148. Julander, in

contrast, seeks stricter regulation of coal- and oil-fired EGUs,

not information that would enable it to comply with its own

regulatory obligations. 

Julander’s suggestion that its interests are properly

characterized as those of a vendor, not a competitor, is

unavailing. It cannot rely on its existing relationship with

natural gas-fired EGUs because they are not subject to the Final

Rule, 77 Fed. Reg. at 9309. And claiming that it has standing as

a potential vendor to coal- and oil-fired EGUs, in the event they

were forced to switch to natural gas, is at odds with the

reasoning underlying the vendor-vendee line of cases. A vendor

has standing “to assert the interest of [regulated] vendees.” 

Nat’l Cottonseed Products Ass’n v. Brock, 825 F.2d 482, 490

(D.C. Cir. 1987) (citing FAIC Secs., Inc. v. United States, 768

F.2d 352, 360–61 (D.C. Cir. 1985)). Julander is not standing in

for the interests of its potential vendees, which, in fact, here

challenge Julander’s petition. Consequently, the interests of

Julander and the regulated industry petitioners are not “two sides

of the same coin.” FAIC Secs., 768 F.2d at 359. 

Julander had the opportunity to submit its views on fuel

switching to EPA during the rulemaking proceedings. And it

did. See Julander Comments Aug. 4, 2011. It could also have

sought permission to appear as amicus in this court, which it did

not. Absent any reason to conclude that it is an “unusually

suitable champion[]” of Congress’ goals in the CAA, we hold,

consistent with this court’s precedent, that Julander’s interest in

increasing the regulatory burden on others falls outside the zone

of interests protected by the CAA and therefore Julander may

not proceed as a petitioner in this court. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 61 of 90
KAVANAUGH, Circuit Judge, concurring in part and 

dissenting in part: Suppose you were the EPA Administrator. 

You have to decide whether to go forward with a proposed air 

quality regulation. Your only statutory direction is to decide 

whether it is “appropriate” to go forward with the regulation. 

Before making that decision, what information would you 

want to know? You would certainly want to understand the 

benefits from the regulations. And you would surely ask how 

much the regulations would cost. You would no doubt take 

both of those considerations – benefits and costs – into 

account in making your decision. That’s just common sense 

and sound government practice. 

So it comes as a surprise in this case that EPA excluded 

any consideration of costs when deciding whether it is 

“appropriate” – the key statutory term – to impose significant 

new air quality regulations on the Nation’s electric utilities. 

In my view, it is unreasonable for EPA to exclude 

consideration of costs in determining whether it is 

“appropriate” to impose significant new regulations on 

electric utilities. To be sure, EPA could conclude that the 

benefits outweigh the costs. But the problem here is that EPA 

did not even consider the costs. And the costs are huge, about 

$9.6 billion a year – that’s billion with a b – by EPA’s own 

calculation. 

In Part I of this opinion, I explain my respectful 

disagreement with the majority opinion’s decision to uphold 

EPA’s exclusion of cost from its decisionmaking under this 

statutory provision. 

In Part II of this opinion, I write to address this Court’s 

case law applying the “zone of interests” test under the 

Administrative Procedure Act. I accept the majority 

opinion’s conclusion that petitioner Julander Energy 

Corporation – a natural gas company challenging EPA’s 

allegedly unlawful under-regulation of Julander’s competitor 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 62 of 90
2 

coal and oil companies – does not fall within the “zone of 

interests” of the Clean Air Act, at least as the zone of interests 

test has been applied by some decisions of this Court. But 

those decisions are inconsistent with other decisions of this 

Court and, more importantly, are incompatible with a 40-year 

string of Supreme Court decisions applying the “zone of 

interests” test. Put simply, our case law applying the zone of 

interests test is in a state of disorder and needs to be cleaned 

up in the near future. 

I 

These consolidated cases concern EPA’s Final Rule, 

“National Emission Standards for Hazardous Air Pollutants 

From Coal- and Oil-Fired Electric Utility Steam Generating 

Units,” 77 Fed. Reg. 9304 (Feb. 16, 2012). The Rule 

implements provisions of the Clean Air Act, 42 U.S.C. § 7401 

et seq., regarding emissions of hazardous air pollutants. 

As the majority opinion recounts, the Clean Air Act 

originally provided EPA substantial discretion to identify and 

regulate pollution from sources emitting hazardous air 

pollutants. That approach proved to be time-consuming and 

largely unworkable, so in 1990 Congress amended the Act to 

cabin much of EPA’s discretion. The 1990 amendments 

required EPA to identify stationary sources of 189 

enumerated hazardous air pollutants and to adopt standards 

for limiting emissions of those pollutants from those sources. 

See 42 U.S.C. § 7412.1

 Those technology-based standards are 

 1

 Six other common pollutants emitted by stationary sources 

are regulated under a different section of the Clean Air Act. The 

National Ambient Air Quality Standards, or NAAQS, prescribe the 

maximum permissible levels of those six pollutants in the ambient 

air. See 42 U.S.C. § 7409(a)-(b). Under that NAAQS program, 

EPA must choose levels for emissions of those pollutants which, 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 63 of 90
3 

commonly referred to as the “maximum achievable control 

technology,” or MACT, standards. 

EPA uses a two-step process for setting MACT 

standards. It begins by setting a minimum stringency level, or 

“floor,” based on the performance of the best-performing 

units in a particular source category. See id. § 7412(d)(3). At 

that first step, EPA may not consider costs. Once the agency 

sets the statutory floor, it then determines, considering cost 

and the other factors listed in Section 112(d)(2), whether an 

even more restrictive standard is “achievable.” Id. § 

7412(d)(2). EPA refers to these stricter requirements as 

“beyond-the-floor” standards.

The two-step process outlined in Section 112(d) – what I 

will call the MACT program – applies automatically to most 

sources of hazardous air pollutants. 

But for one category of sources – electric utilities –

Congress devised an alternative system as set forth in Section 

112(n)(1)(A) of the Act.2

 That alternative system erects two 

threshold hurdles before EPA may regulate electric utilities 

under the MACT program. First, Congress required EPA to 

“perform a study of the hazards to public health reasonably 

anticipated to occur as a result of emissions by” electric 

utilities and report the results of the study to Congress within 

three years of the enactment of the amendments. Id.

§ 7412(n)(1)(A). Second, Congress provided that after the 

study was completed, EPA could regulate electric utilities 

under the MACT program only “if the Administrator finds 

 

“allowing an adequate margin of safety, are requisite to protect the 

public health.” Id. § 7409(b)(1). 

2

 The electric utilities included in this alternative system are 

coal- and oil-fired electric utility steam generating units. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 64 of 90
4 

such regulation is appropriate and necessary after considering 

the results of the study.” Id. (emphasis added).3

 

The meaning of Section 112(n)(1)(A) – particularly the 

term “appropriate” – is a critical question in this litigation. 

Industry petitioners and EPA dispute whether EPA, when 

determining whether regulation of electric utilities under the 

MACT program is “appropriate,” must consider the cost to 

industry and the public from regulating electric utilities under 

that program.4

 

EPA thinks not. EPA acknowledges that, in the past, it 

has interpreted and applied the word “appropriate” in this 

statute to provide for the consideration of costs. See 70 Fed. 

Reg. 15,994, 16,001 & n.19 (Mar. 29, 2005). But the agency 

has changed its interpretation. EPA’s position now is that 

 3

 In full, the relevant section of the statute reads: “The 

Administrator shall perform a study of the hazards to public health 

reasonably anticipated to occur as a result of emissions by electric 

utility steam generating units of pollutants listed under subsection 

(b) of this section after imposition of the requirements of this 

chapter. The Administrator shall report the results of this study to 

the Congress within 3 years after November 15, 1990. The 

Administrator shall develop and describe in the Administrator’s 

report to Congress alternative control strategies for emissions which 

may warrant regulation under this section. The Administrator shall 

regulate electric utility steam generating units under this section, if 

the Administrator finds such regulation is appropriate and necessary 

after considering the results of the study required by this 

subparagraph.” 42 U.S.C. § 7412(n)(1)(A). 

4

 The other key statutory term in Section 112(n)(1)(A) –

“necessary” – is not in dispute. EPA states that regulation of 

electric utilities is necessary “if the identified or potential hazards to 

public health or the environment will not be adequately addressed 

by the imposition of the requirements of” the Clean Air Act. 76 

Fed. Reg. 24,976, 24,987 (May 3, 2011). 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 65 of 90
5 

EPA may reasonably exclude consideration of costs in 

determining whether it is “appropriate” to regulate electric 

utilities under the MACT program. The majority opinion 

upholds EPA’s interpretation. 

I respectfully disagree with the majority opinion. It is 

certainly true, as the majority opinion states, that the word 

“appropriate” is ambiguous in isolation, and that an agency’s 

reasonable interpretation of an ambiguous statutory term is 

permissible. See Chevron U.S.A. Inc. v. NRDC, 467 U.S. 837 

(1984). But the agency’s answer must be “a permissible 

construction of the statute” – or put another way, the agency’s 

interpretation of the ambiguity must be reasonable. Id. at 843. 

Moreover, under the APA, an agency must consider the 

relevant factors when exercising its discretion under the 

governing statute. See Motor Vehicle Manufacturers 

Association of the United States, Inc. v. State Farm Mutual 

Automobile Insurance Co., 463 U.S. 29, 42-43 (1983). 

In this case, whether one calls it an impermissible 

interpretation of the term “appropriate” at Chevron step one, 

or an unreasonable interpretation or application of the term 

“appropriate” at Chevron step two, or an unreasonable 

exercise of agency discretion under State Farm, the key point 

is the same: It is entirely unreasonable for EPA to exclude 

consideration of costs in determining whether it is 

“appropriate” to regulate electric utilities under the MACT 

program. 

To begin with, consideration of cost is commonly 

understood to be a central component of ordinary regulatory 

analysis, particularly in the context of health, safety, and 

environmental regulation. And Congress legislated against 

the backdrop of that common understanding when it enacted 

this statute in 1990. Put simply, as a matter of common sense, 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 66 of 90
6 

common parlance, and common practice, determining 

whether it is “appropriate” to regulate requires consideration 

of costs. 

Drawing on his extensive administrative law and 

regulatory experience, not to mention his experience as a 

jurist, Justice Breyer has perhaps best explained the centrality 

of cost consideration to proper regulatory decisionmaking. In 

order “better to achieve regulatory goals – for example, to 

allocate resources so that they save more lives or produce a 

cleaner environment – regulators must often take account of 

all of a proposed regulation’s adverse effects.” Whitman v. 

American Trucking Associations, 531 U.S. 457, 490 (2001) 

(Breyer, J., concurring). That is so because “every real choice 

requires a decisionmaker to weigh advantages against 

disadvantages, and disadvantages can be seen in terms of 

(often quantifiable) costs.” Entergy Corp. v. Riverkeeper, 

Inc., 556 U.S. 208, 232 (2009) (opinion of Breyer, J.). Cost is 

a particularly salient consideration for administrative agencies 

today, “in an age of limited resources available to deal with 

grave environmental problems, where too much wasteful 

expenditure devoted to one problem may well mean 

considerably fewer resources available to deal effectively 

with other (perhaps more serious) problems.” Id. at 233. An 

“absolute prohibition” on considering costs “would bring 

about irrational results. . . . [I]t would make no sense to 

require plants to spend billions to save one more fish or 

plankton. That is so even if the industry might somehow 

afford those billions.” Id. at 232-33 (internal citation and 

quotation marks omitted). 

In addition to Justice Breyer, many other leading jurists 

and scholars on administrative law have likewise recognized 

that cost generally has to be a relevant factor in the overall 

regulatory mix. Consider the following: 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 67 of 90
7 

Justice Kagan: “[W]hat does it take in a statute to 

make us say, look, Congress has demanded that the 

regulation here occur without any attention to costs? 

In other words, essentially, Congress has demanded 

that the regulation has occurred in a fundamentally 

silly way.” Transcript of Oral Argument at 13, EPA v. 

EME Homer City Generation, L.P., No. 12-1182 (U.S. 

Dec. 10, 2013).5

Professor Sunstein: “Without some sense of both costs 

and benefits – both nonmonetized and monetized –

regulators will be making a stab in the dark.” Cass R. 

Sunstein, Cost-Benefit Analysis and the Environment, 

ETHICS 351, 354 (2005). 

Professor Sunstein: “A rational system of regulation 

looks not at the magnitude of the risk alone, but 

assesses the risk in comparison to the costs.” Cass R. 

Sunstein, Interpreting Statutes in the Regulatory State, 

103 HARV. L. REV. 405, 493 (1989). 

Professor Sunstein: “[A]ny reasonable judgment will 

ordinarily be based on some kind of weighing of costs 

and benefits, not on an inquiry into benefits alone. . . . 

If the costs would be high and the benefits low, on 

what rationale should . . . the EPA refuse even to 

consider the former? There appears to be no good 

answer. If there is not, the agency’s interpretations 

should be declared unreasonable.” Cass R. Sunstein, 

 5

 To be clear, I do not read the statutory text at issue in the 

EME Homer case as encompassing costs, at least not in the way 

EPA argued there. But regardless of how that particular case turns 

out, the background principle succinctly articulated by Justice 

Kagan at oral argument reflects the commonsense and well-settled 

understanding that cost is an essential factor in determining whether 

it is “appropriate” to regulate. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 68 of 90
8 

Cost-Benefit Default Principles, 99 MICH. L. REV. 

1651, 1694 (2001). 

Professors Revesz and Livermore: “For certain kinds 

of governmental programs, the use of cost-benefit 

analysis is a requirement of basic rationality.” 

RICHARD L. REVESZ & MICHAEL A. LIVERMORE, 

RETAKING RATIONALITY 12 (2008). 

Professor Pierce: “All individuals and institutions 

naturally and instinctively consider costs in making 

any important decision. . . . [I]t is often impossible for 

a regulatory agency to make a rational decision 

without considering costs in some way.” Richard J. 

Pierce, Jr., The Appropriate Role of Costs in 

Environmental Regulation, 54 ADMIN. L. REV. 1237, 

1247 (2002). 

Every presidential administration for more than three 

decades has likewise made analysis of costs an integral part of 

the internal Executive Branch regulatory process. See

generally Helen G. Boutrous, Regulatory Review in the 

Obama Administration: Cost-Benefit Analysis for Everyone, 

62 ADMIN. L. REV. 243, 246-48 (2010). Most recently, in 

2011, President Obama issued Executive Order 13,563, which 

follows an earlier Order issued by President Clinton and 

followed by President George W. Bush. The Order directs 

each agency “to use the best available techniques to quantify 

anticipated present and future benefits and costs as accurately 

as possible.” 76 Fed. Reg. 3821, 3821 (Jan. 21, 2011). Under 

President Obama’s Executive Order, agencies may proceed 

with proposed regulations only if the benefits justify the costs. 

Id. 

To be clear, Congress may itself weigh the costs of a 

particular kind of regulation, or otherwise take costs out of the 

equation, when assigning authority to executive and 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 69 of 90
9 

independent agencies to regulate a particular industry or in a 

particular area. See Whitman v. American Trucking 

Associations, 531 U.S. 457 (2001) (statutory provision does 

not include consideration of costs). And even when an 

agency has to take costs into account, it of course may 

conclude that the benefits of a proposed regulation outweigh 

the costs. Moreover, different agency heads, and different 

Presidents, may assess and weigh certain benefits and costs 

differently depending on their overarching philosophies. 

But when considering just as a general matter whether it 

is “appropriate” to regulate, it is well-accepted that 

consideration of costs is a central and well-established part of 

the regulatory decisionmaking process. 

But EPA did not consider costs here. And EPA’s failure 

to do so is no trivial matter. The estimated cost of compliance 

with EPA’s Final Rule is approximately $9.6 billion per year, 

by EPA’s own calculation. 77 Fed. Reg. at 9306, Table 2. To 

put it in perspective, that amount would pay the annual health 

insurance premiums of about two million Americans. It 

would pay the annual salaries of about 200,000 members of 

the U.S. Military. It would cover the annual budget of the 

entire National Park Service three times over. Put simply, the 

Rule is “among the most expensive rules that EPA has ever 

promulgated.” JAMES E. MCCARTHY, CONGRESSIONAL 

RESEARCH SERVICE, R42144, EPA’S UTILITY MACT: WILL 

THE LIGHTS GO OUT? 1 (2012). 

EPA calculated the $9.6 billion cost figure as part of its 

Regulatory Impact Analysis accompanying the Rule. That 

Regulatory Impact Analysis was required by President 

Obama’s Executive Order. Yet EPA’s official position in this 

Court is that the costs identified in the Regulatory Impact 

Analysis should have “no bearing on” the determination of 

whether regulation is appropriate. EPA Br. 55. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 70 of 90
10 

On the other side of the ledger, the benefits of this Rule 

are disputed: Industry petitioners focus on the reduction in 

hazardous air pollutant emissions attributable to the 

regulations, which amount to only $4 to $6 million dollars 

each year. See 77 Fed. Reg. at 9428; State, Industry & Labor 

Br. 21. If those figures are right, the Rule costs nearly $1,500 

for every $1 of health and environmental benefit produced. 

For its part, EPA says it would estimate the benefits at $37 to 

$90 billion dollars based on what it says are the indirect 

benefits of reducing PM2.5, a type of fine particulate matter 

that is not itself regulated as a hazardous air pollutant. See 77 

Fed. Reg. at 9428. 

To be sure, as I have said, EPA may be able to conclude 

that the benefits outweigh the costs in determining whether it 

is “appropriate” to regulate electric utilities under the MACT 

program. But to reiterate, that’s not what EPA has done in 

this Rule. Rather, according to EPA, it is irrelevant how 

large the costs are or whether the benefits outweigh the costs 

in determining whether it is “appropriate” to regulate 

electric utilities under the MACT program. 

In response to petitioners’ claim that the legal issue here 

has huge real-world consequences, the majority opinion 

suggests that it may not matter all that much that EPA refused 

to consider costs in deciding whether it is “appropriate” to 

regulate electric utilities under the MACT program, because 

EPA does account for costs in the second step of the MACT 

program, when EPA sets “beyond-the-floor” standards. Maj. 

Op. at 24. I respectfully find that to be a red herring. After 

all, once EPA determines that it is appropriate to regulate 

electric utilities under the MACT program, costs are not 

relevant at the first, “setting the floor” stage of the MACT 

program. And meeting that floor will be prohibitively 

expensive, particularly for many coal-fired electric utilities, 

regardless of whether EPA decides to go further and set a 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 71 of 90
11 

“beyond-the-floor” standard. So in the real world in which 

electric utilities operate, the financial burden of complying 

with that first “setting the floor” step of the MACT program –

where costs are not considered – will likely knock a bunch of 

coal-fired electric utilities out of business and require 

enormous expenditures by other coal and oil-fired electric 

utilities. Telling someone that costs will be considered in a 

regulatory step that occurs after they have already had to pay 

an exorbitant amount and may already have been put out of 

business is not especially reassuring. The majority opinion’s 

attempt to downplay the effects of its decision thus rings a bit 

hollow. 

In downplaying the issue here, the majority opinion also 

says that the result of this case is that electric utilities will just 

be treated like other sources. In saying that, the majority 

opinion, in my respectful view, does not sufficiently account 

for the fact that treating electric utilities differently from 

standard sources was the intent of Section 112(n)(1)(A), as 

revealed by the statutory text. If Congress had intended EPA 

to consider the costs of regulating electric utilities only when 

deciding whether to adopt beyond-the-floor standards, and not 

as a threshold decision in deciding whether to regulate electric 

utilities under the MACT program to begin with, it would 

have done one of two things: It would have either 

automatically regulated electric utilities under the MACT 

program, as it did with other sources, or provided that 

regulation under the MACT program would be automatic if 

the three-year study found that these sources indeed emitted 

hazardous air pollutants. That Congress declined to choose 

either of those options, and instead directed EPA to regulate 

electric utilities under the MACT program only if 

“appropriate,” reinforces the conclusion that Congress 

intended EPA to consider costs in deciding whether to 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 72 of 90
12 

regulate electric utilities at the threshold, and not simply at the 

second beyond-the-floor stage of the MACT program. 

Not only does EPA’s approach depart from the clear 

statutory scheme, standard agency decisionmaking, and the 

common understanding of the term “appropriate” in this 

regulatory context, it also effectively negates the 

congressional compromise that was ultimately embodied in 

the statutory text of the 1990 Act. Under the initial Senate 

proposal, electric utilities would been have listed as sources 

under Section 112(c) and therefore automatically regulated 

under Section 112(d), the MACT program. See 3 A

LEGISLATIVE HISTORY OF THE CLEAN AIR ACT AMENDMENTS 

OF 1990, at 4119, 4418-28 (1993). But the House 

subsequently modified the Senate bill to make regulation of 

electric utilities under the MACT program dependent on the 

results of a study and the Administrator’s subsequent 

determination that regulation was “appropriate” and 

necessary. See 2 id. at 2148-49. In the words of the House 

bill’s legislative sponsor, Congressman Oxley, the goal of the 

counter-proposal was to provide “protection of the public 

health while avoiding the imposition of excessive and 

unnecessary costs on residential, industrial, and commercial 

consumers of electricity.” See 1 id. at 1417 (emphasis added). 

The House’s proposal ultimately prevailed with the 

Conference Committee “because of . . . the extremely high 

costs that electric utilities will face under other provisions of 

the new Clean Air Act amendments.” Id. at 1416. That 

Conference Committee view – that EPA should avoid 

imposing unwarranted financial burdens when deciding to 

regulate electric utilities – is encapsulated in the textual 

directive that EPA regulate electric utilities under the MACT 

program only if “appropriate.” 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 73 of 90
13 

The majority opinion here says that the term 

“appropriate” is ambiguous. But the Supreme Court often 

looks to legislative history to help inform interpretation of 

otherwise ambiguous statutes, including in Chevron cases. 

See Chevron 467 U.S. at 843 n.9. And here, the legislative 

history should resolve any lingering ambiguity on the key 

point of what “appropriate” encompasses. It establishes that 

Congress in 1990 chose to impose these threshold 

requirements on EPA specifically because it wanted EPA to 

consider costs before regulating electric utilities under the 

MACT program. EPA’s interpretation of Section 

112(n)(1)(A) in this case upsets Congress’s careful balance 

and stacks the deck in favor of regulation of electric utilities 

under the MACT program. In effect, EPA’s reading of the 

statute replaces its authority to regulate electric utilities if 

“appropriate” with a command to regulate electric utilities 

under the MACT program regardless of costs. That is not 

what Congress intended or permitted and thus is beyond 

EPA’s authority. See Chevron, 467 U.S. at 843 n.9. 

In upholding EPA’s cost-blind approach, the majority 

opinion points to other statutory provisions that expressly 

reference cost and invokes the familiar interpretive canon that 

“[w]here Congress includes particular language in one section 

of a statute but omits it in another section of the same Act, it 

is generally presumed that Congress acts intentionally and 

purposely in the disparate inclusion or exclusion.” Russello v. 

United States, 464 U.S. 16, 23 (1983). The majority opinion 

assigns particular weight to the Supreme Court’s decision in 

Whitman v. American Trucking Associations, 531 U.S. 457 

(2001), which referenced that canon when construing a 

different section of the Clean Air Act. See Whitman, 531 U.S. 

at 467 (“We have therefore refused to find implicit in 

ambiguous sections of the CAA an authorization to consider 

costs that has elsewhere, and so often, been expressly 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 74 of 90
14 

granted.”). As in Whitman, according to the majority opinion, 

Congress’s decision not to explicitly mention cost in Section 

112(n)(1)(A), despite doing so in other parts of the Act, 

creates a negative implication that costs are an unnecessary 

consideration. 

But I respectfully believe the majority opinion is 

misreading – or at least over-reading – Whitman. Whitman

was a textualist decision written for a unanimous Court by 

Justice Scalia. It stands for the basic proposition that 

consideration of costs cannot be jammed into a statutory 

factor that, by its terms, otherwise would not encompass 

“costs,” particularly when other provisions of the Act 

expressly reference costs. See Entergy, 556 U.S. at 223 

(Whitman “stands for the rather unremarkable proposition that 

sometimes statutory silence, when viewed in context, is best 

interpreted as limiting agency discretion.”). 

In Whitman itself, the statutory factor was a provision of 

the Clean Air Act, Section 109(b)(1), that directed EPA to set 

ambient air quality standards at levels “requisite to protect the 

public health” with “an adequate margin of safety.” 42 

U.S.C. § 7409(b)(1). The dispute concerned whether those 

“modest words” granted EPA “the power to determine 

whether implementation costs should moderate national air 

quality standards.” 531 U.S. at 468. Concluding that EPA 

had not been granted such power, the Court speaking through 

Justice Scalia observed that cost “is both so indirectly related 

to public health and so full of potential for canceling the 

conclusions drawn from direct health effects that it would 

surely have been expressly mentioned in §§ 108 and 109 had 

Congress meant it to be considered.” Id. at 469. 

The statutory provision at issue in Whitman differs 

significantly from the statute at issue here. The statutory 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 75 of 90
15 

provision in Whitman tied regulation solely to “public health,”

which is typically a critical factor on the other side of the 

balance from costs, not a factor that includes costs. Here, by 

contrast, the key statutory term is “appropriate” – the classic 

broad and all-encompassing term that naturally and 

traditionally includes consideration of all the relevant factors, 

health and safety benefits on the one hand and costs on the 

other. To unblinkingly rely on Whitman here is to overlook 

the distinct language of the relevant statutes. Cf. Michigan v. 

EPA, 213 F.3d 663, 677-79 (D.C. Cir. 2000) (the term 

“significant” “does not in itself convey a thought that 

significance should be measured in only one dimension,” and 

in “some contexts, ‘significant’ begs a consideration of 

costs”). 

To sum up: All significant regulations involve tradeoffs, 

and I am very mindful that Congress has assigned EPA, not 

the courts, to make many discretionary calls to protect both 

our country’s environment and its productive capacity. In this 

case, if EPA had decided, in an exercise of its judgment, that 

it was “appropriate” to regulate electric utilities under the 

MACT program because the benefits outweigh the costs, that 

decision would be reviewed under a deferential arbitrary and 

capricious standard of review. See American Radio Relay 

League, Inc. v. FCC, 524 F.3d 227, 247-48 (D.C. Cir. 2008) 

(separate opinion of Kavanaugh, J.). But before we assess the 

merits of any cost-benefit balancing, this statutory scheme 

requires that we first ensure that EPA has actually considered 

the costs. See State Farm, 463 U.S. at 42-43. In my view, 

whether we call it a Chevron problem or a State Farm

problem, it is unreasonable for EPA to exclude consideration 

of costs when deciding whether it is “appropriate” to regulate 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 76 of 90
16 

electric utilities under the MACT program. I respectfully 

dissent from the majority opinion’s contrary conclusion.6

II 

 This case implicates another important administrative law 

issue, the “zone of interests” test under the Administrative 

Procedure Act.7

 The Court holds that petitioner Julander 

Energy Company falls outside the “zone of interests” the 

Clean Air Act is designed to protect and thus cannot challenge 

the Final Rule. The Court reasons that the concerns raised by 

 6

 On the Chevron point, I add one further comment. When the 

Government wins a Chevron case, it may prevail at Chevron step 

one (because the agency’s interpretation of the statute is mandated 

by the statutory language) or at Chevron step two (because the 

agency’s interpretation of an ambiguous statute is at least 

reasonable). In those cases, the step one or step two label may have 

practical significance, as it may determine whether the agency 

could try to adopt a contrary interpretation in the future. On the 

other hand, when the agency loses a Chevron case because the 

agency has adopted an interpretation outside the permissible bounds 

of the statute, even after reading relevant ambiguities in the 

agency’s favor, there is not much if any practical difference for 

purposes of future agency action whether we label our decision as 

Chevron step one or Chevron step two. See generally City of 

Arlington v. FCC, 133 S. Ct. 1863, 1868, 1874 (2013). So it is 

here, in my view. 

7

 This Court has traditionally referred to the zone of interests 

test as a component of “prudential standing.” As the Supreme 

Court has recently explained, however, the test does not belong 

under the “prudential” rubric. Lexmark International, Inc. v. Static 

Control Components, Inc., No. 12-873 (U.S. Mar. 25, 2014). 

Instead, whether a plaintiff comes with the “zone of interests” is a 

statutory question “that requires us to determine, using traditional 

tools of statutory interpretation, whether a legislatively conferred 

cause of action encompasses a particular plaintiff’s claim.” Id., slip 

op. at 8. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 77 of 90
17 

Julander, a natural gas production company, are merely to 

seek more stringent regulation of its coal and oil company 

competitors. See Maj. Op. at 57-58. 

 I reluctantly join that portion of the Court’s opinion 

because it is consistent with some of this Court’s previous 

decisions applying the zone of interests test. I hasten to add 

that the decisions on which the Court today relies are 

inconsistent with other of this Court’s precedents. Given that 

our case law makes this issue a de facto coin flip, I cannot 

fault an opinion that lands on heads rather than tails. 

I am concerned, however, about the erratic inconsistency 

in our case law. I am even more concerned that our cases 

holding that competitors are outside the zone of interests –

including today’s decision – are inconsistent with the 

governing Supreme Court precedents. I write separately to 

explain my concerns. 

 The Supreme Court first announced the APA “zone of 

interests” test in Association of Data Processing Service 

Organizations, Inc. v. Camp, 397 U.S. 150 (1970) (Data 

Processing). In that case, vendors of data processing services 

challenged the Comptroller of the Currency’s decision to 

allow competitor national banks to sell the same services. 

The data processing vendors alleged that the agency decision 

violated a provision of the National Bank Act. The district 

court dismissed the case for lack of standing, and the court of 

appeals affirmed the dismissal. The Supreme Court reversed. 

For purposes of Article III standing, the Court first said that 

there was “no doubt” that the petitioners had alleged a 

sufficient “injury in fact.” Id. at 152. In reaching that 

conclusion, the Court rejected the then-prevailing requirement 

that plaintiffs show that a defendant’s actions invaded a “legal 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 78 of 90
18 

interest” belonging to the plaintiff. Id. at 153. The Court 

instead adopted the now-familiar “injury in fact” test. 

For purposes of the APA, the Court added that the 

separate question of being able to sue under the APA 

“concerns, apart from the ‘case’ or ‘controversy’ test, the 

question whether the interest sought to be protected by the 

complainant is arguably within the zone of interests to be 

protected or regulated by the statute or constitutional 

guarantee in question.” Id. And the Court said that the “zone 

of interests” requirement was satisfied by the plaintiffs in 

Data Processing, who were competitors of the national banks. 

The Court noted with approval the “trend . . . toward 

enlargement of the class of people who may protest 

administrative action.” Id. at 154. In keeping with that trend, 

the Court refused to take an overly restrictive view of “the 

generous review provisions” of the APA, which the Court 

noted should be construed “not grudgingly but as serving a 

broadly remedial purpose.” Id. at 156.8

The Supreme Court reaffirmed its broad understanding of 

the zone of interests test in Arnold Tours, Inc. v. Camp, 400 

U.S. 45 (1970) and Investment Company Institute v. Camp, 

401 U.S. 617 (1971). The plaintiffs in both cases were 

competitors of national banks. Both cases concerned 

decisions by the Comptroller of the Currency to authorize 

 8

 Although Data Processing referenced the Administrative 

Procedure Act, the opinion did not explicitly tie the zone of 

interests test to the text of the APA. The Court subsequently 

clarified that the zone of interests test is a “gloss” on Section 702 of 

the APA, which grants the right to judicial review of an agency 

action to any person “adversely affected or aggrieved” by that 

action. See Clarke v. Securities Industry Association, 479 U.S. 388, 

395, 400 n.16 (1987). 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 79 of 90
19 

national banks to offer new services to customers: travel 

services in Arnold Tours and investment services in 

Investment Company Institute. And in both cases, the Court 

held that plaintiffs who would have to compete with the banks 

under the new regulations satisfied the zone of interests test 

and could challenge the Comptroller’s decision. See Arnold 

Tours, 400 U.S. at 46; Investment Company Institute, 401 

U.S. at 620-21. 

Notably, Justice Harlan dissented in Investment Company 

Institute because there was no evidence of “any congressional 

concern for the interests of petitioners and others like them in 

freedom from competition.” Investment Company Institute, 

401 U.S. at 640 (Harlan, J., dissenting). But that fact, the 

Court held, was not fatal to the plaintiffs’ case; it was enough 

to satisfy the zone of interests test that Congress, for its own 

reasons, “did legislate against the competition that the 

petitioners challenge.” Id. at 621 (majority opinion). 

Thus, at the time of its inception, the zone of interests test 

was understood to be part of a broader trend toward 

expanding the class of persons able to bring suits under the 

APA challenging agency actions. See Copper & Brass 

Fabricators Council, Inc. v. Department of the Treasury, 679 

F.2d 951, 953 n.2 (D.C. Cir. 1982) (R.B. Ginsburg, J., 

concurring) (in each of the Supreme Court’s first four zone of 

interests decisions, the Court “utilized the ‘zone’ test to 

reverse lower court decisions which had held that the 

respective plaintiffs lacked standing”). Although the Supreme 

Court was cognizant of the dangers of freely permitting 

judicial review of agency decisions, it nonetheless “struck the 

balance in a manner favoring review,” as the Court later 

described it, excluding only “those would-be plaintiffs not 

even arguably within the zone of interests to be protected or 

regulated by the statute.” Clarke v. Securities Industry 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 80 of 90
20 

Association, 479 U.S. 388, 397 (1987) (internal quotation 

marks omitted). 

And importantly for present purposes, the Supreme Court 

in those early zone of interest cases specifically held that the 

class of persons who could sue specifically included plaintiffs 

who were complaining about what they alleged was 

unlawfully lax agency regulation of the plaintiffs’ 

competitors. The theory was simple: Competitors, almost by 

definition, are among the class of people “arguably” to be 

“protected” when Congress limited the activities of other 

competitors in the relevant industry. So absent a discernible 

congressional intent to preclude suit by the plaintiffs, the suit 

could proceed. 

In the years following Data Processing, however, this 

Court appeared to resist the Supreme Court’s direction on 

competitor suits under the zone of interests test. This Court’s 

cases still said, for example, that the zone of interests test 

required “some indicia – however slight – that the litigant 

before the court was intended to be protected” by the statute 

providing a cause of action. See, e.g., Copper & Brass 

Fabricators, 679 F.2d at 952 (majority opinion). 

In Clarke v. Securities Industry Association, 479 U.S. 

388 (1987), however, the Supreme Court reaffirmed that it 

meant what it said in Data Processing. And the Court in 

Clarke explicitly stated that D.C. Circuit cases had incorrectly 

departed from Data Processing. See id. at 400 n.15. 

Clarke was another case in which some plaintiffs argued 

that the Comptroller of the Currency’s regulation of the 

plaintiffs’ competitors was unduly lax. Specifically, 

securities brokers challenged the Comptroller’s decision to 

exempt certain bank offices that offered brokerage services 

from restrictions on branch banking. The Court began its 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 81 of 90
21 

analysis by clarifying that although the zone of interests test 

was “basically one of interpreting congressional intent,” the 

inquiry did not require a congressional intent to benefit the 

plaintiff class. Clarke, 479 U.S. at 394, 399-400. Rather, 

suits would be allowed unless a “congressional intent to 

preclude review” in suits by the plaintiffs was “fairly 

discernible.” Id. at 403 (citing Block v. Community Nutrition 

Institute, 467 U.S. 340, 351 (1984)) (internal quotation marks 

omitted). The zone of interests test “is a guide for deciding 

whether, in view of Congress’ evident intent to make agency 

action presumptively reviewable, a particular plaintiff should 

be heard to complain of a particular agency decision. In cases 

where the plaintiff is not itself the subject of the contested 

regulatory action, the test denies a right of review if the 

plaintiff’s interests are so marginally related to or inconsistent 

with the purposes implicit in the statute that it cannot 

reasonably be assumed that Congress intended to permit the 

suit. The test is not meant to be especially demanding.” Id. at 

399. 

In sum, Clarke confirmed the capacious view of the zone 

of interests requirement announced in Data Processing and 

similar cases. It reaffirmed the presumption in favor of 

allowing suit and made clear that the suit should be allowed 

unless the statute evinces discernible congressional intent to 

preclude review. See 3 RICHARD J. PIERCE, JR.,

ADMINISTRATIVE LAW TREATISE § 16.9, at 1521 (5th ed. 

2010) (“An injured plaintiff has standing under the APA 

unless Congress intended to preclude judicial review at the 

behest of parties in plaintiff’s class.”). 

And most importantly for our purposes, Clarke

confirmed that competitors were presumptively within the 

zone of interests under the APA when challenging allegedly 

lax regulation of other competitors in the relevant industry, 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 82 of 90
22 

absent discernible evidence of contrary congressional intent. 

See id. at 403 (“competitors who allege an injury that 

implicates the policies of the National Bank Act are very 

reasonable candidates to seek review of the Comptroller’s 

rulings”). 

As one respected commentator has summarized the 

Supreme Court’s case law: “It is hardly a caricature to say 

that the current law is this: Businesses desiring to complain 

that the government is regulating their competitors with 

insufficient stringency are invariably and automatically held 

to fall within the zone of interests of any allegedly violated 

statute . . . .” Jonathan R. Siegel, Zone of Interests, 92 GEO.

L.J. 317, 347 (2004) (emphasis added). 

Despite the apparent clarity of Clarke – and its explicit 

disapproval of this Court’s zone of interests cases – some of 

this Court’s post-Clarke decisions nonetheless still have 

barred competitors from suing because they are purportedly 

outside the zone of interests. For example, in Hazardous 

Waste Treatment Council v. EPA, 861 F.2d 277 (D.C. Cir. 

1988) – a case on which the Court today relies – we 

considered a claim by waste treatment companies that EPA’s 

waste disposal standards were unduly lax toward some 

competitors of the waste treatment companies. Id. at 283. As 

I read the cases, Clarke, Data Processing, Investment 

Company, and Arnold Tours had contemplated that the zone 

of interests test would be satisfied in such a scenario. 

Nevertheless, in Hazardous Waste, we held that the plaintiffs 

did not fall within the zone of interests “in the absence of 

either some explicit evidence of an intent to benefit such 

firms, or some reason to believe that such firms would be 

unusually suitable champions of Congress’s ultimate goals.” 

Hazardous Waste, 861 F.2d at 283. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 83 of 90
23 

In my view, that language in Hazardous Waste is difficult 

to square with what the Supreme Court said in Clarke and 

earlier cases.9

 In those cases, the Supreme Court had 

specifically said that there does not need to be evidence of an 

intent to benefit the plaintiff class. In fact, the Supreme Court 

said that suit should be allowed unless there was a discernible 

congressional intent to preclude suit by the plaintiff class. In 

other words, this Court’s cases seemingly flipped the 

presumption in favor of allowing suit by competitor plaintiffs 

to a presumption against allowing suit by competitor 

plaintiffs. 

The confusion in our case law has only grown in the 

years following Hazardous Waste. Sometimes we allow 

competitors to sue, opining, for example, that we “take from” 

cases like Clarke “the principle that a plaintiff who has a 

competitive interest in confining a regulated industry within 

certain congressionally imposed limitations may sue to 

prevent the alleged loosening of those restrictions.” First 

National Bank & Trust Co. v. National Credit Union 

Administration, 988 F.2d 1272, 1277 (D.C. Cir. 1993); see, 

e.g., Sherley v. Sebelius, 610 F.3d 69, 75 (D.C. Cir. 2010) 

(allowing doctors to sue because of allegedly illegal agency 

under-regulation of other doctors: “Because the Act can 

plausibly be interpreted to limit research involving” 

embryonic stem cells, “the Doctors’ interest in preventing the 

NIH from funding such research is not inconsistent with the 

purposes of the Amendment. . . . [T]hat is all that matters.”); 

Honeywell International Inc. v. EPA, 374 F.3d 1363, 1370 

(D.C. Cir. 2004) (allowing chemical manufacturer to sue 

because of allegedly illegal agency under-regulation of 

 9

 Chief Judge Wald stated as much at the time. See Hazardous 

Waste Treatment Council v. Thomas, 885 F.2d 918, 931 (D.C. Cir. 

1989) (Wald, C.J., dissenting). 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 84 of 90
24 

competing chemicals: “If there is reason to believe that a 

party’s interest in statutory enforcement will advance, rather 

than hinder, the operation of a statute, the court can 

reasonably assume that Congress intended to permit the 

suit.”); Ethyl Corp. v. EPA, 306 F.3d 1144, 1148 (D.C. Cir. 

2002) (allowing manufacturer of fuel additives to sue because 

of allegedly illegal under-regulation of automobile 

manufacturers: zone of interests “includes not only those 

challengers expressly mentioned by Congress, but also 

unmentioned potential challengers that Congress would have 

thought useful for the statute’s purpose”); Wabash Valley 

Power Association, Inc. v. FERC, 268 F.3d 1105, 1112 (D.C. 

Cir. 2001) (allowing power association to sue because of 

allegedly illegal under-regulation of merging utility 

companies: “In this case, as a competitor crying foul, Wabash 

satisfies prudential standing requirements.”); Mova 

Pharmaceutical Corp. v. Shalala, 140 F.3d 1060, 1076 (D.C. 

Cir. 1998) (allowing drug manufacturer to sue because of 

allegedly illegal agency under-regulation of other drug 

manufacturer: “Upjohn’s interest in limiting competition for 

its product is, by its very nature, linked with the statute’s goal 

of limiting competition between generic manufacturers.”) 

(internal citation and quotation marks omitted); see also

Amgen, Inc. v. Smith, 357 F.3d 103, 109 (D.C. Cir. 2004) 

(“Parties motivated by purely commercial interests routinely 

satisfy the zone of interests test under this court’s 

precedents.”). 

But other times, as in Hazardous Waste, we say exactly 

the opposite, that competitors are not within the zone of 

interests and are barred from suing. See, e.g., Association of 

Battery Recyclers, Inc. v. EPA, 716 F.3d 667, 674 (D.C. Cir. 

2013) (lead smelter could not object to lax regulation of other 

lead smelters: plaintiff objected “not to any regulatory burden 

imposed on it but instead to the absence of regulatory burdens 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 85 of 90
25 

imposed on its competitors”); Grocery Manufacturers 

Association v. EPA, 693 F.3d 169, 179 (D.C. Cir. 2012) (food 

producers could not object to lax regulation of ethanol 

producers who compete with food producers in market to 

purchase corn);10 Cement Kiln Recycling Coalition v. EPA, 

255 F.3d 855, 871 (D.C. Cir. 2001) (hazardous waste 

combustors could not object to lax regulation of competing 

combustors: “the Council’s interest lies only in increasing the 

regulatory burden on others”); ANR Pipeline Co. v. FERC, 

205 F.3d 403, 408 (D.C. Cir. 2000) (natural gas pipeline 

operator could not object to lax regulation of competitor’s 

pipeline: plaintiff’s “only concern is with suppressing 

competition from Nautilus, and that economic interest is not 

within the zone of interests protected by NEPA”); Liquid 

Carbonic Industries Corp. v. FERC, 29 F.3d 697, 705 (D.C. 

Cir. 1994) (industrial gas corporation could not object to lax 

regulation of competitor’s facilities: “There being no 

indication that Congress intended to benefit a second-tier 

competitor, Liquid Carbonic does not have standing as an 

intended beneficiary.”). 

Those competing lines of cases have developed without 

any apparent distinguishing principle. Having carefully 

reviewed all of them together in one sitting, I frankly cannot 

find a clear line to separate the cases where we have found 

competitors to be within the zone of interests from the cases 

where we have not. 

 10 In Grocery Manufacturers Association v. EPA, 693 F.3d 169 

(D.C. Cir. 2012), we addressed an additional question of whether 

the zone of interests test is a jurisdictional requirement. The 

Supreme Court has since made clear that the zone of interests test is 

not jurisdictional. See Lexmark International, Inc. v. Static Control 

Components, Inc., No. 12-873, slip op. at 9 n.4 (U.S. Mar. 25, 

2014). 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 86 of 90
26 

Moreover, there is nothing in the Clean Air Act that 

poses a stricter limit on competitor suits than in APA cases 

involving other statutes. The default rule set forth by the 

Supreme Court for APA cases is that competitors may sue, 

unless the substantive statute at issue excludes such suits. 

Nothing in the Clean Air Act indicates an intent to exclude 

competitor suits. And it is surely not incongruent with the 

Clean Air Act to allow competitor suits. By definition, a 

successful competitor suit would mean that the source would 

have to comply with stricter Clean Air Act limits. Put simply: 

Allowing competitor suits in Clean Air Act cases will mean 

cleaner air. Excluding competitor suits in Clean Air Act cases 

will mean dirtier air. 

Apart from our case law’s internal inconsistency, the 

larger problem, as I see it, is that the line of cases in this Court 

that have held that competitors are outside the zone of 

interests is out of step with the Supreme Court’s case law

from Data Processing to Clarke. What is more, the Supreme 

Court’s cases since Clarke have only reinforced the broad 

conception set forth in Data Processing and Clarke. See, e.g., 

National Credit Union Administration v. First National Bank 

& Trust Co., 522 U.S. 479, 493-94 (1998) (“As competitors 

of federal credit unions, respondents certainly have an interest 

in limiting the markets that federal credit unions can serve, 

and the NCUA’s interpretation has affected that interest by 

allowing federal credit unions to increase their customer 

base.”); see also Air Courier Conference of America v. 

American Postal Workers Union, AFL-CIO, 498 U.S. 517, 

529 (1991) (“Clarke is the most recent in a series of cases in 

which we have held that competitors of regulated entities 

have standing to challenge regulations.”); Lexmark 

International, Inc. v. Static Control Components, Inc., No. 12-

873, slip op. at 11 (U.S. Mar. 25, 2014) (a “lenient approach” 

to the zone of interests test “is an appropriate means of 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 87 of 90
27 

preserving the flexibility of the APA’s omnibus judicialreview provision, which permits suit for violations of 

numerous statutes of varying character that do not themselves 

include causes of action for judicial review”). 

Among the Supreme Court’s post-Clarke decisions is 

Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians v. 

Patchak, 132 S. Ct. 2199 (2012). Although not a competitor 

case, the reasoning of Match-E reinforces Data Processing

and Clarke, and reaffirms the Supreme Court’s broad 

conception of the zone of interests under the APA. 

Writing for the Court in Match-E, Justice Kagan 

reiterated that the zone of interests requirement is a low bar: 

The test “is not meant to be especially demanding. We apply 

the test in keeping with Congress’s evident intent when 

enacting the APA to make agency action presumptively 

reviewable. We do not require any indication of 

congressional purpose to benefit the would-be plaintiff. And 

we have always conspicuously included the word ‘arguably’ 

in the test to indicate that the benefit of any doubt goes to the 

plaintiff. The test forecloses suit only when a plaintiff’s 

interests are so marginally related to or inconsistent with the 

purposes implicit in the statute that it cannot reasonably be 

assumed that Congress intended to permit the suit.” Id. at 

2210 (emphasis added) (footnote, citation, and some internal 

quotation marks omitted). 

Match-E reaffirmed – in line with Data Processing and 

Clarke – that the plaintiff need not be among a class that 

Congress intended to benefit in the statute at hand. And 

Match-E further reaffirmed that a wide variety of interests, 

including economic interests related to the agency’s allegedly 

unlawful action with respect to someone else, fall within the 

zone of interests. There, a residential property owner claimed 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 88 of 90
28 

that the Interior Department violated federal law when it 

acquired a parcel of land for use by a nearby Indian tribe as a 

casino. See id. at 2202-03. All agreed that the federal statute 

was not designed to benefit a property owner who objects 

when the Federal Government acquires another property 

owner’s land in order to help Indians. See id. at 2210 n.7. 

The Supreme Court nonetheless concluded that the zone of 

interests test was satisfied. The Supreme Court said that 

“neighbors to the use (like Patchak) are reasonable – indeed, 

predictable – challengers of the Secretary’s decisions: Their 

interests, whether economic, environmental, or aesthetic, 

come within § 465’s regulatory ambit.” Id. at 2212 (emphasis 

added). 

Given its music and its words, Match-E should have put a 

final end to this Court’s crabbed approach to the zone of 

interests test. But our Court has still continued since Match-E

to hold – at least in some cases – that the zone of interests test 

prevents businesses from complaining about allegedly illegal 

agency under-regulation of their competitor businesses. See, 

e.g., Association of Battery Recyclers, 716 F.3d at 674; 

Grocery Manufacturers Association, 693 F.3d at 179. 

Put simply, our current zone of interests case law is 

inconsistent and unpredictable. Perhaps most troubling, our 

cases holding that competitors are outside the zone of 

interests are inconsistent with Supreme Court precedent, as I 

read it. In my respectful view, too much is at stake in the 

administrative process, for health, safety, and environmental 

regulation, and for the economic interests affected by these 

cases for us to continue muddling along in this way. This 

state of affairs should receive a careful examination at some 

point in the near future. Whether a party can sue in court to 

challenge illegal agency action on such important matters 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 89 of 90
29 

should not come down to the equivalent of a coin flip. We 

can do better. 

* * * 

I respectfully dissent from the majority opinion’s 

conclusion that EPA may reasonably exclude consideration of 

costs when deciding whether it is appropriate to regulate 

electric utilities under the MACT program. And on the zone 

of interests test, I accept the majority opinion’s conclusion 

that Julander falls outside the zone of interests, at least under 

some of our precedents. But in my view, those precedents are 

not consistent with other decisions of this Court or with the 

Supreme Court’s case law and should be corrected in due 

course. 

USCA Case #12-1100 Document #1488346 Filed: 04/15/2014 Page 90 of 90