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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 20, 2004 Decided June 22, 2004

No. 03-1120

BLUEWATER NETWORK,

PETITIONER

v.

ENVIRONMENTAL PROTECTION AGENCY AND

MICHAEL O. LEAVITT, ADMINISTRATOR,

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

RESPONDENTS

On Petition for Review of an Order of the

Environmental Protection Agency

J. Martin Wagner argued the cause for the petitioner.

Barbara B. Baird and Frances L. Keeler were on brief for

amicus curiae, South Coast Air Quality Management District.

Eileen T. McDonough, Attorney, United States Department of Justice, argued the cause for the respondents. John

 Bills of costs must be filed within 14 days after entry of judgment.

The court looks with disfavor upon motions to file bills of costs out

of time.
2

C. Cruden, Deputy Assistant Attorney General, United States

Department of Justice, was on brief.

Janice K. Raburn, for American Petroleum Institute, John

Longstreth, for The Transportation Institute, C. Jonathan

Benner, for International Association of Independent Tanker

Owners and Chamber of Shipping of America, and Marc J.

Fink for World Shipping Council, were on joint brief for

amici curiae, American Petroleum Institute et al. Sean T.

Connaughton, for International Association of Independent

Tanker Owners and Chamber of Shipping of America, entered an appearance.

Before: GINSBURG, Chief Judge, HENDERSON, Circuit Judge,

and WILLIAMS, Senior Circuit Judge.

Opinion for the court filed by Circuit Judge HENDERSON.

KAREN LECRAFT HENDERSON, Circuit Judge: Petitioner

Bluewater Network (Bluewater) challenges the Environmental Protection Agency’s (EPA or Agency) final rule adopting a

two-tiered approach to setting emissions standards for ‘‘Category 3’’ marine diesel engines which are ‘‘very large marine

engines used primarily for propulsion power on ocean-going

vessels such as container ships, tankers, bulk carriers, and

cruise ships.’’ Control of Emissions from New Marine Compression-Ignition Engines at or Above 30 Liters Per Cylinder,

68 Fed. Reg. 9746, 9747 (Feb. 28, 2003) (to be codified at 40

C.F.R. pts. 9 & 94). Bluewater claims that the rule fails to

reduce emissions from those engines and entirely omits to

regulate the emissions from foreign-flagged ships’ engines, as

required by section 213(a)(3) of the Clean Air Act (CAA). 42

U.S.C. § 7547(a)(3); see also id. § 7607(d)(9)(A). We conclude that the EPA reasonably interpreted and implemented

the CAA and therefore deny Bluewater’s petition for review.

I.

In 1970, the Congress enacted the CAA ‘‘to protect and

enhance the quality of the Nation’s air resources so as to

promote the public health and welfare and the productive

capacity of its population.’’ Id. § 7401(b)(1). In 1990, it
3

added section 213, which authorizes the EPA to establish

emissions standards for ‘‘nonroad engines and nonroad vehicles.’’ Id. § 7547(a)(1); see Husqvarna AB v. EPA, 254 F.3d

195, 197 (D.C. Cir. 2001); see also Engine Mfrs. Ass’n v.

EPA, 88 F.3d 1075, 1080-81 (D.C. Cir. 1996). Section

213(a)(1) and (2) requires the EPA to determine whether the

emissions from ‘‘new and existing nonroad engines or nonroad

vehicles’’ are ‘‘significant contributors’’ to air pollution in

areas with air quality problems. 42 U.S.C. § 7547(a)(1) & (2).

Section 213(a)(3) in turn requires the EPA to promulgate

emissions standards for all ‘‘new nonroad engines TTT which

in the Administrator’s judgment cause, or contribute to, such

air pollution.’’ Id. § 7547(a)(3) (emphasis added). The standards must:

achieve the greatest degree of emission reduction

achievable through the application of technology

which the [EPA] Administrator determines will be

available for the engines or vehicles to which such

standards apply, giving appropriate consideration to

the cost of applying such technology within the

period of time available to manufacturers and to

noise, energy, and safety factors associated with the

application of such technology.

Id. The standards must also ‘‘take effect at the earliest

possible date considering the lead time necessary to permit

the development and application of the requisite technology,

giving appropriate consideration to the cost of compliance

within such period and energy and safety.’’ Id. § 7547(b).

Finally, the EPA must revise the standards from ‘‘time to

time.’’ Id. § 7547(a)(3).

In 1994, the EPA determined that nonroad engines and

vehicles contribute significantly to air pollution in problem

areas throughout the country and set about the process of

setting emissions standards for various categories of engines,

including marine diesel engines. See Control of Air Pollution;

Determination of Significance for Nonroad Sources and Emission Standards for New Nonroad Compression-Ignition Engines at or Above 37 Kilowatts, 59 Fed. Reg. 31, 306 (June 17,
4

1994) (to be codified at 40 C.F.R. pts. 9 & 89); Control of Air

Pollution; Emission Standards for New Gasoline SparkIgnition and Diesel Compression-Ignition Marine Engines, 59

Fed. Reg. 55,930 (notice of proposed rulemaking) (Nov. 9,

1994). As noted above, the Category 3 marine diesel engines

that are the subject of this rulemaking are some of the

largest engines in the world, with greater than 30 liters

displacement per cylinder. See 68 Fed. Reg. at 9747. The

engines burn residual fuel oil – a byproduct of refining crude

oil into higher-grade products – which tends to have higher

ash, sulfur and nitrogen content than other fuels. See id. at

9767. Residual fuel oil also has a higher variability than

other fuels, which makes engine emissions more difficult to

control. See id. at 9763. The engines thus contribute to

national ozone, carbon monoxide, nitrous oxide (NOx) and

particulate matter levels, especially near commercial ports

like New Orleans, LA and along coastal areas like Santa

Barbara, CA. See id. at 9751. Existing diesel engine technologies, such as turbo- and super-charging, in-cylinder injection improvements and engine cooling, are used to increase

the efficiency and reduce emissions from these engines. See

id. at 9749. There are also new, advanced technologies,

including systems that introduce water into the combustion

process, selective catalytic reduction systems that add a

reducing agent like ammonia into the engine’s exhaust and

the use of fuel cells. See id. at 9764-67.

The EPA’s effort to set emissions standards for Category 3

engines coincided with similar action taken by the International Marine Organization (IMO).1

 See, e.g., Control of Air

Pollution; Emission Standards for New Gasoline SparkIgnition and Diesel Compression-Ignition Marine Engines;

Exemptions for New Nonroad Compression-Ignition Engines

at or Above 37 Kilowatts and New Nonroad Spark-Ignition

Engines at or Below 19 Kilowatts, 61 Fed. Reg. 4600, 4618

1 The IMO is an agency of the United Nations set up to improve

the safety of international shipping and to control marine pollution.

See International Marine Organization, at www.imo.org (‘‘Safer

Shipping, Cleaner Oceans’’). It consists of 163 member countries,

including the United States. Id.
5

(supplemental notice of proposed rulemaking; proposed revisions) (Feb. 7, 1996); 59 Fed. Reg at 55,934. In 1997, the

IMO formally adopted Annex VI to the International Convention on the Prevention of Pollution from Ships, 1973, as

Modified by the Protocol of 1978 Relating Thereto (MARPOL). Annex VI prescribes a NOx emissions limit for diesel

engines on ships constructed on or after January 1, 2000 and

for engines undergoing ‘‘major conversion’’ on or after that

date. Regulation 13 to Annex VI of MARPOL. Annex VI

has recently been ratified by the requisite number of IMO

member countries and will take effect in May 2005. See

http://www.imo.org/home.asp (last visited June 2, 2004).

Following the IMO’s adoption of Annex VI, the EPA

noticed its intent to set the CAA emissions standards for

Category 3 engines at the same level set by Annex VI. See

Control of Emissions of Air Pollution from New CI Marine

Engines at or Above 37 Kilowatts, 63 Fed. Reg 28,309, 28,313

(advance notice of proposed rulemaking) (May 22, 1998). It

reasoned that Category 3 engines ‘‘have only a minimal

impact on U.S. air quality’’ because they operate in U.S.

waters for ‘‘only a limited amount of time’’ and that any

stricter standards could be applied to U.S. ships only, potentially compromising their competitiveness in the world shipping market. Id. Several months later, the EPA decided to

postpone adopting emissions standards for these engines.

Control of Emissions of Air Pollution from New CI Marine

Engines at or Above 37 kW, 63 Fed. Reg. 68,508, 68,541-42

(notice of proposed rulemaking) (Dec. 11, 1998). Because it

believed Annex VI’s standards to be appropriate for Category

3 engines under the CAA based on its analysis of available

control technologies, the EPA concluded that adopting those

standards ‘‘would be unnecessary and redundant’’ because it

expected U.S. vessels to comply with the Annex VI standards.

Id. at 68,542. In the same notice, the EPA also proposed

excluding smaller (categories 1 and 2) diesel engines on

foreign-flagged vessels in U.S. waters from any emissions

standards, id. at 68,516-17, because, relying in part on United

States Treasury Department rulings and tariff schedules, it

deemed foreign-flagged ships engaged in international trade
6

not to have been imported into the United States. Id. The

EPA’s final rule adopted both positions: it did not set emissions standards for Category 3 engines and it defined the

Category 1 and Category 2 engines to which its rule applied

so as to exempt those aboard foreign-flagged ships. Control

of Emissions of Air Pollution From New Marine Compression-Ignition Engines at or Above 37 kW, 64 Fed. Reg.

73,300, 73,302, 73,306 (Dec. 29, 1999) (codified at 40 C.F.R.

pts. 89, 92, 94).

In 2000, Earth Island Institute, an environmental group,

originally petitioned for review of that rule; Bluewater became the petitioner in 2002. As part of a settlement agreement in that matter, the EPA agreed to initiate the rulemaking that resulted in the rule now under review. Thus, in May

2002, the EPA proposed, among other things, to formally

adopt the Annex VI emissions standards as the CAA standards for Category 3 engines. Control of Emissions of Air

Pollution from New Marine Compression-Ignition Engines at

or Above 30 Liters/Cylinder, 67 Fed. Reg. 37,548 (proposed

rule) (May 29, 2002). It also invited comment on whether it

should adopt stricter emissions standards in the future and

expand those standards to cover Category 3 engines on

foreign-flagged vessels entering U.S. territory. Id.

On February 28, 2003, the EPA issued the rule under

review. Control of Emissions from New Marine Compression

Ignition Engines at or Above 30 Liters Per Cylinder, 68 Fed.

Reg. 9746 (Feb. 28, 2003) (to be codified at 40 C.F.R. pts. 9 &

94). The rule provides a two-step approach for setting emissions standards for Category 3 engines under the CAA. Id.

at 9748-49. The first step, which the EPA referred to as its

‘‘near term Tier 1’’ standard, tracks Annex VI’s emissions

standards and took effect on January 1, 2004. Id. at 9749.

The standards, the EPA explained, apply only to U.S.-flagged

ships and are intended to ‘‘achieve a 20-percent reduction in

the national Category 3 NOx inventory by 2030.’’ Id. at 9757,

9762. The EPA also committed to a second step, imposing

longer term ‘‘Tier 2 standards’’ in a rulemaking to be completed ‘‘no later than April 27, 2007.’’ Id. at 9749-50. In the

future rulemaking, the EPA promised to ‘‘consider the state
7

of technology that may permit deeper emission reductions

and the status of international action for more stringent

standards’’ as well as ‘‘application of [these] standards to

engines on foreign vessels that enter U.S. ports.’’ Id. at 9746.

In establishing the Tier 1 emissions standards at the Annex

VI level and postponing Tier 2 standards to the 2007 rulemaking, the EPA recognized that ‘‘manufacturers are generally already meeting the internationally negotiated standards’’

and thus ‘‘[t]he near term standards will require no additional

development, design, or testing beyond what manufacturers

are already doing to meet the TTT Annex VI TTT standards.’’

Id. at 9761; see id. at 9749. The EPA explained, however,

that the Tier 1 standards are ‘‘designed to be achievable

immediately without additional research and development’’

and are thus ‘‘based on readily available emission-control

technolog[ies]’’ – like ‘‘optimized turbocharging, higher compression ratios, and optimized fuel injection.’’ Id. at 9748-49,

9761. Most importantly, the EPA explained, these standards

will be almost immediately (i.e., on January 1, 2004) ‘‘enforceable under U.S. law TTT regardless of whether Annex VI has

entered into force or whether the United States has deposited

its instruments of ratification to TTT Annex VI.’’ Id. at 9761.

The EPA understood that ‘‘manufacturers [could] achieve

additional [emission] reductions with more lead time’’ by

‘‘expanding the use and optimization of in-cylinder controls’’

and by utilizing one or more of the ‘‘advanced technologies

such as selective catalytic reduction or water injection,’’ and

thus that it could have established stricter Tier 1 as well as

specific Tier 2 standards. Id. at 9748-49, 9761-62. It noted,

however, several problems with both approaches. Stricter

Tier 1 standards would require ‘‘more lead time’’ for manufacturers as opposed to the readily-achievable Annex VI standards. Id. at 9749, 9761. Furthermore, there were ‘‘several

outstanding technical issues concerning the widespread commercial use’’ of the current, in-cylinder and advanced emission control technologies. Id. at 9748; see id. at 9749, 9761-

63. Postponing the adoption of specific, and stricter, standards until the Tier 2 rulemaking allowed the industry and

the EPA to ‘‘obtain important additional information on the
8

use of these advanced technologies.’’ Id. at 9478, 9763.

Additionally, mandating greater reductions via current, incylinder controls alone – which might reduce emissions by 10

or even 30 per cent – risked sacrificing potentially greater

future reductions from the combination of in-cylinder controls

and the new technologies, which the EPA expected to ‘‘be

greater than 30 percent below Tier 1 levels.’’ Id. at 9749.

Setting specific and stricter Tier 2 standards based on the

available and emerging control technologies at the same time

that engine manufacturers were investigating other controls

could have the perverse effect of encouraging manufacturers

to conduct ‘‘two separate and possibly conflicting design

steps, potentially delaying introduction of advanced emissioncontrol technologies and their anticipated emission reductions.’’ Id.; see id. at 9761. By providing manufacturers

additional time to test and study the results of those technologies, the EPA would be better positioned in 2007 ‘‘to make a

technology-based decision that maximizes emission reductions.’’ Id. at 9749. Finally, the EPA noted that postponing

the adoption of stricter standards allowed the United States

‘‘to pursue further negotiations in the international arena to

achieve more stringent global emission standards for marine

diesel engines’’ inasmuch as, in the EPA’s view, ‘‘adopting

appropriate international standards has the potential to maximize the control of emissions from U.S. and foreign vessels.’’

Id. In sum, the EPA decided to adopt the Annex VI emissions standards as the Tier 1 standards in order to ‘‘ensure

that Category 3 engines achieve the greatest reductions

achievable in this [short] time frame, until the more stringent

long-term standards [the EPA] adopt[s] [at the Tier 2 rulemaking] go into effect.’’ Id. at 9761.

The EPA also postponed imposing emissions standards on

Category 3 engines on foreign-flagged vessels. Id. at 9759.

The EPA noted that in its 1999 rulemaking for categories 1

and 2 marine diesel engines, it had interpreted the term ‘‘new

nonroad engine’’ to exclude such engines on foreign-flagged

vessels. Id.; see supra. Even assuming it had the authority

under the CAA to regulate Category 3 engines on foreignflagged ships, the EPA nevertheless opted to postpone the
9

matter until the Tier 2 rulemaking. 68 Fed. Reg. at 9759.

Employing the same rationale used to postpone rulemaking

for Category 3 engines for U.S. vessels, the EPA concluded

that the delay would not ‘‘lead to any significant loss in

emission reductions’’ because it expected all foreign-flagged

vessels, like U.S. vessels, to comply with the Annex VI

standards (as manufacturers had been doing since 2000). Id.

It also noted that the delay could ‘‘help facilitate the adoption

of more stringent consensus international standards,’’ id., and

stated elsewhere that it would ‘‘continue to promote more

stringent standards at [the] IMO’’ and that it ‘‘now believe[d]

that TTT the IMO should consider further reductions of

significantly more than 30 percent from the [current Annex

VI] NOx limits.’’ Id. at 9767.

On April 23, 2003, Bluewater petitioned this court for

review of the EPA’s Category 3 engine rule. It raises two

claims. First, it asserts that the Agency acted arbitrarily and

capriciously in failing to adopt standards that reduce emissions from Category 3 engines to the greatest degree achievable through available control technologies. See 42 U.S.C.

§ 7607(d)(9)(A) (reviewing court may reverse emissions standards promulgated under 42 U.S.C. § 7547 if ‘‘arbitrary,

capricious, an abuse of discretion, or otherwise not in accordance with law’’). Second, Bluewater contends that the EPA

violated the command of section 213(a)(3) of the CAA by

failing to regulate emissions from engines on foreign-flagged

vessels. See id. § 7547(a)(3).

II.

We give particular deference to the EPA when it acts

under ‘‘ ‘unwieldy and science-driven’ ’’ statutory schemes like

the Clean Air Act. Husqvarna, 254 F.3d at 199 (quoting

Appalachian Power Co. v. EPA, 135 F.3d 791, 801-02 (D.C.

Cir. 1998)); see Baltimore Gas & Elec. Co. v. NRDC, 462 U.S.

87, 103 (1983) (court is ‘‘at its most deferential’’ if agency is

‘‘making predictions, within its area of special expertise, at

the frontiers of science’’). We will therefore affirm the EPA’s

action unless it is ‘‘arbitrary, capricious, an abuse of discre-
10

tion, or otherwise not in accordance with law.’’ 42 U.S.C.

§ 7607(d)(9)(A). Our review of the EPA’s interpretation of

the CAA is governed by the familiar two-step from Chevron,

U.S.A., Inc. v. NRDC, 467 U.S. 837, 842-43 (1984). We first

ask ‘‘whether Congress has directly spoken to the precise

question at issue,’’ in which case we ‘‘must give effect to the

unambiguously expressed intent of Congress.’’ Id. If the

‘‘statute is silent or ambiguous with respect to the specific

issue,’’ however, we move to the second step and defer to the

agency’s interpretation as long as it is ‘‘based on a permissible construction of the statute.’’ Id. at 843.

1. EPA’s Two-Tiered Emissions Standards for Category 3

Engines

Bluewater first contends that the EPA’s rule adopting twotiered emissions standards for Category 3 engines is arbitrary and capricious because it fails to reduce NOx emissions

as required by the CAA. It argues that, because manufacturers are already complying with the Annex VI standards, the

Tier 1 standards are simply an iteration of the status quo and

effect no reduction in emissions. The contemplated Tier 2

standards, meanwhile, cannot save the rule, Bluewater says,

because the EPA has not even committed to stricter Tier 2

standards. Relying on this court’s decision in Husqvarna,

254 F.3d at 201, Bluewater contends that section 213(a)(3) of

the CAA is a ‘‘technology-forcing standard’’ that requires the

EPA to adopt stricter emissions standards based on the

technologies available to manufacturers, including both incylinder and advanced technologies. We disagree.

The EPA rule adopting the two-tiered approach to emissions standards is, we think, a reasonable one that satisfies

the requirements of section 213(a)(3) of the CAA. The

Agency expects the Tier 1 emissions standards to reduce

Category 3 NOx emissions by 20 per cent by 2030. 68 Fed.

Reg. at 9762, 9777. Furthermore, after surveying the available technologies and ‘‘consider[ing]’’ emissions reductions

beyond the Annex VI standards, the EPA concluded that it

could require the use of only those technologies manufacturers currently employed to meet Annex VI’s requirements
11

because the Tier 1 standards were scheduled to go into effect

less than one year from the date of publication. Id. at 9749;

see id. at 9761. The consideration of ‘‘lead time’’ in setting

emissions standards is specifically contemplated by the CAA.

42 U.S.C. § 7547(b) (standards must ‘‘take effect at the

earliest possible date considering the lead time necessary to

permit the development and application of the requisite technology’’); Husqvarna, 254 F.3d at 202 (EPA appropriately

determined that ‘‘schedule of declining emission standards

TTT provide[d] adequate time for manufacturers’ transition to

cleaner engine technologies’’); see Sierra Club v. EPA, 325

F.3d 374, 378 (D.C. Cir. 2003) (‘‘The statute TTT intends the

agency to consider many factors other than pure technological capability, such as costs, lead time, safety, noise and

energy.’’ (emphasis added)).

Bluewater does not allege that the EPA ignored the available in-cylinder and advanced technologies or improperly

evaluated their merit; it argues instead that the Agency

impermissibly postponed incorporating them into the emissions standards until the Tier 2 rulemaking in 2007. But the

lesson from Husqvarna – a challenge by engine manufacturers to an emissions standard mandating the use of costly

control technologies – is not that the EPA must adopt the

most stringent standards based on the most advanced control

technologies but that the EPA is to arrive at standards that

reduce emissions to the greatest degree possible after considering the spectrum of available technologies and the costs and

benefits associated with those technologies. See Husqvarna,

254 F.3d at 201 (‘‘The record shows that the EPA reasonably

arrived at what it determined was the best regulatory standard by ascertaining the greatest degree of emissions reduction achievable while giving appropriate consideration to cost,

noise, energy and safety factors.’’); see also 42 U.S.C.

§ 7547(a)(3) (standards must achieve greatest reduction available through technology ‘‘which the [EPA] Administrator

determines will be available TTT giving appropriate consideration to the cost of applying such technology’’). Indeed, this
12

Court – in interpreting section 202(l )(2) of the CAA,2

 a

provision in pari materia with section 213(a)(3) – has acknowledged that, while the CAA is ‘‘ ‘technology-forcing,’ ’’

‘‘[t]he statute also intends the [EPA] to consider many factors

other than pure technological capability, such as costs, lead

time, safety, noise and energy’’ and that ‘‘its language does

not resolve how the [EPA] should weigh all these factors in

the process of finding the ‘greatest emission reduction achievable.’ ’’ Sierra Club, 325 F.3d at 378 (quoting Husqvarna,

254 F.3d at 201 and 42 U.S.C. § 7521(l )(2)). Here the record

indicates that the EPA recognized the merits of the advanced

technologies but chose not to forestall their further development by either: (1) forcing the industry to ignore them and

instead pursue greater traditional in-cylinder reductions only,

or (2) mandating their use without complete information and

study, thereby potentially handicapping their future (and

greater) success. See, e.g., 68 Fed. Reg. at 9749. These

considerations are hardly unreasonable; indeed, for this court

to reject them would defeat the purpose of the statute by

forsaking, in the EPA’s determination, greater reductions in

air pollution.3

 Finally, and perhaps most importantly, the

EPA has committed to incorporating the new technologies

into stricter emissions standards in the 2007 rulemaking.

2 Section 202(l )(2) requires the EPA to enact standards that

reduce emissions from motor vehicles and motor vehicle fuels that

‘‘reflect the greatest degree of emission reduction achievable

through the application of technology which will be available, taking

into consideration TTT the availability and costs of the technology,

and noise, energy, and safety factors, and lead time.’’ 42 U.S.C.

§ 7521(l )(2).

3 To the extent that Bluewater contends that ongoing treaty

negotiations over international emissions standards impermissibly

factored into the EPA’s decision under section 213(a)(3), that challenge is immaterial because the EPA gave other, independent (and

sufficient) reasons to support the two-tiered standards. See

Indiana Mun. Power Agency v. FERC, 56 F.3d 247, 256 (D.C. Cir.

1995) (upholding agency action resting on several independent

grounds if any are valid unless agency was influenced by their

combined force).
13

See, e.g., 68 Fed. Reg. at 9761 (‘‘The near-term Tier 1

standards are interim standards. They are intended to ensure that Category 3 engines achieve the greatest reductions

achievable in this time frame, until the more stringent longterm standards we adopt go into effect.’’).

The two-tiered approach and the Tier 1 standards themselves are best viewed as akin to the ‘‘anti-backsliding’’ provision this Court upheld in Sierra Club. 325 F.3d at 379. There

we permitted the EPA to utilize a near-term provision preventing fuel refineries and importers from increasing the

toxicity levels in their motor vehicle fuel rather than imposing

a ‘‘more aggressive emissions cap’’ because the provision was

to be in effect for a short period of time only and because it

allowed the EPA to ‘‘assess achievability on a longer term

basis’’ where ‘‘the agency didn’t know what technological fixes

TTT manufacturers would use to’’ best reduce emissions. Id.

at 378-80. Bluewater correctly points out that the Sierra

Club refineries and importers were operating under other

stringent emissions standards already imposed by the EPA,

id. at 380, but the Tier 1 standards effect a 20 per cent

reduction in NOx emissions and guarantee that the Annex VI

standards are ‘‘enforceable under U.S. law for engines on

vessels flagged or registered in the United States, regardless

of whether Annex VI TTT enter[s] into force.’’ 68 Fed. Reg.

at 9761. Based on the record before us, we conclude that the

EPA’s two-tiered approach reasonably implements section

213(a)(3) of the CAA.

2. EPA’s Decision to Defer Regulation of Engines on Foreign-Flagged Vessels

Bluewater further claims that the CAA requires the EPA

to adopt emissions standards for the Category 3 engines of

foreign-flagged vessels. Bluewater contends that, because

the term ‘‘new nonroad engine’’ does not expressly exclude

foreign-flagged vessels’ engines, the statute requires their

regulation. It further argues that, even if the definition of

‘‘new nonroad engine’’ is ambiguous, the EPA’s decision not

to regulate Category 3 engines on foreign-flagged vessels at
14

Tier 1 and instead postpone resolution of the matter until the

Tier 2 rulemaking is arbitrary and capricious. We disagree.

We have previously upheld the EPA’s determination that

‘‘new nonroad engine’’ in 213(a)(3) is ambiguous. See Engine

Mfrs. Ass’n, 88 F.3d at 1086-87. We have also decided that

the two-tiered rulemaking is reasonable and Bluewater offers

nothing in response to the EPA’s claim that delayed resolution of the issue until the 2007 Tier 2 rulemaking would not

‘‘lead to any significant loss in emission reductions’’ because it

expects foreign-flagged vessels to ‘‘comply with the [Annex

VI] standards whether or not they are also subject to the

equivalent Clean Air Act standards.’’ 68 Fed. Reg. at 9759.

We therefore conclude that Bluewater’s claim regarding the

EPA’s deferment of whether to regulate Category 3 engines

on foreign-flagged vessels is premature.

III.

For the foregoing reasons, the petition for review is denied.

So ordered.