Nos. 12-3084, 12-3085 UNITED STATES COURT OF APPEALS FOR THE EIGHTH CIRCUIT

________________ __________________ _____________ STATE OF NEBRASKA, et al. Petitioners,

v. UNITED STATES ENVIRONMENTAL PR OTECTION AGENCY, and GINA McCARTHY, Administrator, United Stat es Environmental Protection Agency, Respondents.

___________________ _____________________ _____________________ ___________ EPA’S MOTION FOR PART IAL VOLUNTARY REMAND

___________________ __________________ __________________ _________________ Respondents United States Environmenta l Protection Agency, et al. (“EPA”) hereby move the Court for an order remanding, without vacatur, a portion of the final action under review in these consolidated petitions, to allow EPA to provide a more detailed and complete explanation of its decision. A remand will also allow EPA to provide stakeholders with noti ce and an opportunity to comment if EPA determines that it is necessary to introduc e new evidence into the record, or to change its final decision. EPA has conferred with counsel for all other parties, and is informed that Petitioners State of Nebraska in No . 12-3084 (“State”) and National Parks2 Conservation Association, et al., in No. 12-3085 (“Environmental Petitioners”) reserve their positions pending re view of EPA’s Motion for Remand. INTRODUCTION The petitions for review challenge a final rule issued by EPA under the Clean Air Act (“Act”) partially approvi ng and partially disapproving a State Implementation Plan (“SIP”) submitted by the State of Nebraska and promulgating a Federal Implementation Plan (“FIP”) to replace the disapproved portions of the SIP. See Approval, Disapproval and Promu lgation of Implementation Plans; State of Nebraska; Regional Haze State Impl ementation Plan; Federal Implementation Plan for Best Available Retrofit Technol ogy Determination, 77 Fed. Reg. 40,150 (July 6, 2012) (“Rule”). The State challenges EPA’s partial SIP disapproval, while Environmental Petitioners challenge EPA’s FIP. As discussed in greater detail infra at 4-7, Congress has established a national goal of preventing and remedying vi sibility impairment in certain national parks, wildernesses, and simi lar areas (known as “Class I areas”). For states that contain Class I areas, state or federa l implementation plans developed under the Act must include (among other provisions) “reasonable progress goals” directed at achieving natural visibility conditions at th ese areas. See 40 C.F.R. § 51.308(d)(1). States that do not contain any Class I ar eas are not required to adopt reasonable progress goals; however, their implementati on plans must still include a long-term3 strategy that incorporates “measures as necessary to achieve the reasonable progress goals established by” states th at do contain such areas. 40 C.F.R. § 51.308(d)(3). Environmental Petitioners argue that th e long-term strategy in the partial FIP that EPA issued for Nebraska does not satisfy these requirements, in that it allegedly does not include measures ne cessary to achieve reasonable progress goals established by South Dakota and Co lorado. See Opening Brief of National Parks Conservation Association and Sie rra Club, ECF No. 4220088 (“Env. Pet. Br.”) at 32-39. As explained in more detail below, in the c ourse of reviewing Environmental Petitioners’ merits brief, EPA has come to the conclusion that it did not fully explain its reasoning or fully respond to public comments regarding the FIP’s alleged deficiency in this regard. EPA therefore seeks a remand without v acatur of this aspect of the FIP, in order to provide EPA with the opportunity to revisit its rationale and, at a minimum, explain it more fully. If EPA determines that it is necessary to introduce new evidence into the record or change its final decision on remand, EPA will provide stakeholders with noti ce and an opportunity to comment before any final decision is reache d. Because the FIP does not require the installation of any additional control technology at the so le facility to which it applies, EPA believes that vacatur of th e remanded aspect of the Rule is unnecessary. Nor4 would a remand affect briefing or argument as to any other aspect of the State’s or Environmental Petitioners’ claims, which are legally and factually distinct from the issue on which EPA seeks remand. BACKGROUND I. STATUTORY AND REGULA TORY BACKGROUND. A. Clean Air Act Overview. The Act controls air pollution through a system of shared federal and state responsibility. See Gen. Mo tors Corp. v. United Stat es, 496 U.S. 530, 532 (1990). In general, EPA establishes standards that protect air quality, and states implement those standards through SIPs. States must submit SIPs and SIP revisions to EPA for approval, and EPA is required to re view each submission to determine if it “meets all of the applicable requirements of [the Act] .” 42 U.S.C. § 7410(k)(3); see also North Dakota v. EPA, 730 F.3d 750, 766 (8 th Cir. 2013), cert. denied, 134 S. Ct. 2662 (2014). If a state fails to fulfill its obligation to submit a SIP that meets applicable statutory and regulat ory requirements, the Act provides a backstop of federal controls. Thus, if EPA disapproves a SIP in whole or in part, EPA must promulgate a FIP in place of a ny disapproved portion of the SIP within two years (unless EPA first approves a state’ s correction of the deficiencies in its SIP). See 42 U.S.C. § 7410(c)(1)(B).5 B. Visibility Protection Under the Act. Congress enacted Section 169A of the Act, 42 U.S.C. § 7491, in 1977 “[i]n response to a growing awareness that visi bility was rapidly deteriorating in many places . . . set aside for special protection in their natural states . . . .” Chevron U.S.A., Inc. v. EPA, 658 F.2d 271, 272 (5 th Cir. 1981). At that time Congress declared as a national goal “the preventio n of any future, and the remedying of any existing, impairment of visibility in mandatory class I Federal areas which impairment results from man-made air pollution. ” 42 U.S.C. § 7491(a)(1). 1 In the 1990 Amendments to the Act, Congress a dded Section 169B, 42 U.S.C. § 7492, to focus attention on regional haze – that is, visibility impairment caused by emissions from multiple sources and activ ities located across a broad geographic area. See 40 C.F.R. § 51.301 ; see also 77 Fed. Reg. 12, 770, 12,771 (Mar. 2, 2012). C. BART and BART Alternatives. The Act’s visibility protection provisions state that SIPs must require certain “major stationary sources” that “emit[] an y air pollutant which may reasonably be anticipated to cause or contribute to a ny impairment of visibility” to “procure, install, and operate, as e xpeditiously as practicable (and maintain thereafter) the best available retrofit technology [“BART ”]. . . . ” 42 U.S.C. § 7491(b)(2)(A); 40

1 Class I federal areas include certain na tional wilderness areas, national memorial parks, and national parks. 42 U.S.C. § 7 472. “Impairment of visibility” means “reduction in visual range and atmospheric discoloration.” Id

. § 7491(g)(6).6 C.F.R. § 51.301. BART is “an emi ssion limitation based on the degree of reduction achievable through the applicati on of the best system of continuous emission reduction” for visibility-impairi ng pollutants emitted by certain stationary facilities. 40 C.F.R. § 51. 301. This emission limit must be established case-bycase, taking five statutory factors into consideration. 2 EPA’s Regional Haze Rule, which implem ents the Act’s visibility protection provisions, provides states with an alte rnative to requiring source-specific BART controls. Specifically, a state need not requi re sources to install BART controls if that state “demonstrates that an emissions trading program or other alternative will achieve greater reasonable progress towa rd natural visibility conditions.” 40 C.F.R. § 51.308(e). In June 2012, EP A determined that the emission trading programs in EPA’s Cross-State Air Polluti on Rule (the “Transport Rule”) “achieve greater reasonable progress towards the na tional goal of achieving natural visibility conditions in Class I areas th an source-specific [BART]” in Transport Rule states. 77 Fed. Reg. 33,642, 33,643 (June 7, 2012); see also 76 Fed. Reg. 82,219, 82,224- 29 (Dec. 30, 2011). EPA thus amended the Regional Haze Rule, which now provides in pertinent part that states th at participate in Transport Rule trading

2 The BART factors are (a) the costs of compliance; (b) the energy and non-air quality environmental impacts of compliance; (c) any existing pollution controls in use at the source; (d) the re maining useful life of the source; and (e) the predicted visibility improvements from use of controls. 42 U.S.C. § 7491(g)(2).7 programs “need not require BART-eligible fossil fuel-fired steam electric plants in the State to install, operate , and maintain BART for th e pollutant covered by such trading program in the State.” 40 C. F.R. § 51.308(e)(4). This nationwide provision is known as the “better-than-BART” rule. 3 D. Reasonable Progress Goals and the Long-Term Strategy. States that contain Class I areas must include in their SIPs “goals . . . that provide for reasonable progress towards achieving natural visibility conditions” (“reasonable progress goals”) at each Class I area with in a state. 40 C.F.R. § 51.308(d)(1). At a minimum, reasonabl e progress goals “must provide for an improvement in visibility for the most im paired days over the period of the [SIP] and ensure no degradation in visibility fo r the least impaired days over the same period.” Id. States that do not contain Class I areas are not required to adopt reasonable progress goals. See id. In rec ognition of the fact that air pollution does not respect state boundaries, however, such st ates must still include in their SIPs “a long-term strategy that addre sses regional haze visibility impairment for . . . each mandatory Class I Federal area located out side the State which may be affected by emissions from the State.” 40 C.F.R. § 51.308(d)(3).

3 The Transport Rule and th e better-than-BART rule are more fully discussed in EPA’s concurrently-filed brie f on the merits, at 9-11.8 II. FACTUAL BACKGROUND. Nebraska submitted a regional haze SIP revision to EPA on July 13, 2011. 77 Fed. Reg. at 12,775. Included in this SIP revision was a BART determination for sulfur dioxide (“SO 2 ”) emissions from the Gera ld Gentleman Station (the “Station,” or “GGS”), a Nebraska electric power plant. See Nebraska Department of Environmental Quality State Implem entation Plan for Regional Haze and [BART], State of Nebraska’s Appendi x at 513, 519. In July 2012, EPA disapproved this determination, finding signi ficant flaws in several aspects of the State’s analysis of potential emission cont rol technologies. Se e generally 77 Fed. Reg. at 12,779-80; 77 Fed. Reg. at 40, 160-63; Brief of Respondent EPA (filed concurrently on Feb. 6, 2015) at 13-15, 25 -33. EPA also disapproved the State’s long-term strategy to the exte nt that it relied on this flaw ed BART determination. 77 Fed. Reg. at 40,155. EPA promulgated a FIP in place of those elements of the SIP that it disapproved. See 77 Fed. Reg. at 40,151. EPA invoked the better-than-BART rule, opting to “rely[] on the Transport Ru le as an alternative to BART for SO 2 emissions from the [Station].” 77 Fed. Reg. at 12,781; see also 77 Fed. Reg. 40,163-64. EPA further found that the gaps left in the State’s long-term strategy by EPA’s partial disapproval were “addr essed [in EPA’s FIP] through reliance on9 the Transport Rule as an alternative to BART for SO 2 emissions from the [Station].” 77 Fed. Reg. at 12,776; s ee also 77 Fed. Reg. at 40,151. The State and Environmenta l Petitioners filed petitions for review of various aspects of the Rule. In general, the St ate challenges EPA’s pa rtial SIP disapproval, while Environmental Petitioners challenge elements of the FIP. 4 As is relevant here, Environmental Petitioners argue that the FIP’s long-term strategy is deficient because it does not include measures – specifically, the requirement that the Station install certain emission controls – that are allegedly required to achieve reasonable progress goals established fo r Class I areas in South Dakota and Colorado. See Env. Pe t. Br. at 32-39. ARGUMENT I. STANDARD FOR GRANTING VO LUNTARY REMAND WITHOUT VACATUR. “A reviewing court has inherent power to remand a matter to the administrative agency.” Loma Linda Univ. v. Schw eiker, 705 F.2d 1123, 1127 (9 th Cir. 1983); see also Ramirez-Peyr o v. Gonzales, 477 F.3d 637, 642 (8 th Cir. 2007) (“‘Generally speaking, a court of appeal s should remand a case to an agency for

4 The Nebraska Public Power District (“District”) also filed a petition for review. See Nebraska Public Power District v. EPA, No. 12-3061. The District has since dismissed its petition, but remains as an in tervenor in No. 12-3085. See October 4, 2014, Motion for Voluntary Dismissal of Petition for Review in No. 12-3061, ECF No. 4205810, at 3; November 4, 2014, Judgment in No. 12-3061, ECF No. 4213133;10 decision of a matter that statutes place pr imarily in agency hands.’” (citing INS v. Ventura, 537 U.S. 12, 16 (2002)). It is, moreover “generally accepted that in the absence of a specific statutory limitation, an administrative agency has the inherent authority to reconsider its decisions.” Macktal v. Chao, 286 F.3d 822, 825-26 (5 th Cir. 2002); see also Trujillo v. Gen. Elec. Co., 621 F.2d 1084, 1086 (10 th Cir. 1980) (noting that “the power to decide in the first instance carries with it the power to reconsider”). This authority includes the right to seek voluntary remand of a challenged agency decision, without confessing error. SKF USA Inc. v. United States, 254 F.3d 1022, 1029 (Fed. Cir. 2001). For example, an agency may seek remand because it wishes to recons ider its interpretation of the governing statute, the procedures it followed in reaching its decision, or the decision’s relationship to other agency policies. Id . In addition, if an agency has not provided a “reasoned explanation” for its acti on, “it is appropriate to remand to the agency for further proceedings.” Qwes t Corp. v. F.C.C., 258 F.3d 1191, 1201 (10 th Cir. 2001). While the reviewing court has discre tion over whether to remand, voluntary remand is appropriate where the request is reasonable and timely. See Macktal, 286 F.3d at 826. “‘Administrative recons ideration is a more expeditious and efficient means of achieving an adjustment of agency policy than is resort to the federal courts.’” B.J. Alan Co. v. ICC, 897 F.2d 561, 562 n.1 (D.C. Cir. 1990)11 (quoting Commonwealth of Pennsylvania v. ICC, 590 F.2d 1187, 1194 (D.C. Cir. 1978)). As the D.C. Circuit has stat ed, “[w]e commonly gr ant such motions, preferring to allow agencies to cure thei r own mistakes rather than wasting the courts’ and the parties’ resources review ing a record that both sides acknowledge to be incorrect or incomplete.” Ethyl Corp. v. Browner, 989 F.2d 522, 524 (D.C. Cir. 1993). In sum, “‘if the agency’s concern is substantial and legitimate, a remand is usually appropriate.’” C itizens Against the Pellissippi Parkway Extension, Inc. v. Mineta, 375 F.3d 412, 417 (6 th Cir. 2004) (citing SKF USA Inc., 254 F.3d at 1029). In determining whether to remand without vacating the agency’s decision, the court considers “the seriousness of the . . . deficiencies (and thus the extent of doubt whether the agency chose correctly) and the disruptive consequences of an interim change that may its elf be changed.” Allied Si gnal, Inc. v. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 150-51 ( D.C. Cir. 1993) (citation omitted). II. REMAND WITHOUT VACAT UR IS APPROPRIATE. EPA asks the Court to remand the FIP’s long-term strategy for Nebraska, and the cases cited above indicate that such a request should ordinarily be granted. To be clear, EPA does not concede that this aspect of EPA’s final action was erroneous. However, EPA has come to the conclusion that EPA did not fully explain its reasoning on the specific issues raised by Environmental Petitioners at12 the time that EPA promulgated the FIP, and may not have fully responded to comments on this issue. Among other thi ngs, EPA is concerned that its present explanation could potentially be construed in a manner th at is inconsistent with EPA’s interpretation of the relevant st atutory and regulatory requirements. Remand is therefore appropr iate so that EPA has the opportunity to amend or further explain its rationale for declining to require additional c ontrols as part of the FIP’s long-term strategy, to more fully respond to comments submitted by the public, and to take further action if necessary. EPA’s requested remand would not prejud ice any party. If EPA determines that it is necessary to intr oduce new evidence into the record or change its final decision, EPA will provide stakeholders with notice and an opportunity to comment before any final decision following the remand is reached. Any final action on remand would be subject to judicial review pursuant to 42 U.S.C. § 7607(b)(1). The Environmental Petitione rs’ challenge to the FIP’s long-term strategy is, moreover, fact ually and legally distinct from the State’s and Environmental Petitioners’ rema ining challenges to the Rule in this matter, all of which may proceed independently. Nor is vacatur necessary with this voluntary remand. The FIP’s long-term strategy does not require installation of add itional controls at the Station, or any13 other actions that might ultimately prove unnecessary if the remand resulted in a different decision. CONCLUSION For the foregoing reasons, EPA’s final act ion with regard to the long-term strategy for Nebraska should be remanded to EPA without vacatur.

Respectfully submitted,
JOHN C. CRUDEN Assistant Attorney General /s Angeline Purdy

___________________________ ANGELINE PURDY United States Department of Justice Environment and Natural Resources Division 601 D Street, N.W. Suite 8000 Washington, D.C. 20044 (202) 514-0996

OF COUNSEL MATTHEW MARKS M. LEA ANDERSON Office of General Counsel U.S. Environmental Protection Agency Washington, D.C.

SARA HERTZ WU Office of Regional Counsel U.S. Environmental Protection Agency, Region VII14 Lenexa, KS Date: February 6, 201515 CERTIFICATE OF SERVICE I hereby certify that on February 6, 2015, copies of the foregoing Motion for Remand were filed with the Court’s CM /ECF system, which will electronically serve all counsel of record. /s Angeline Purdy

____________________________ Angeline Purdy