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1. Ariz. Pub. Serv. Co. v. United States EPA, 562 F.3d 1116

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Ann Lyons
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Ariz. Pub. Serv. Co. v. United States EPA

United States Court of Appeals for the Tenth Circuit

April 14, 2009, Filed

No. 07-9546, No. 07-9547

Reporter: 562 F.3d 1116; 2009 U.S. App. LEXIS 8109; 68 ERC (BNA) 1737; 39 ELR 20082

ARIZONA PUBLIC SERVICE COMPANY,

Petitioner, v. UNITED STATES

ENVIRONMENTAL PROTECTION AGENCY,

Respondent. SIERRA CLUB, DINE CARE,

DINE FOR THE C-AQUIFER, and SAN JUAN

CITIZENS ALLIANCE, Intervenors. SIERRA

CLUB, DINE CARE, DINE FOR THE

C-AQUIFER, and SAN JUAN CITIZENS

ALLIANCE, Petitioners, v. UNITED STATES

ENVIRONMENTAL PROTECTION AGENCY,

Respondent. ARIZONAPUBLICSERVICE

COMPANY, Intevenor.

Prior History: [**1] On Petitions For Review

of a Final Action of the United States

Environmental Protection Agency.

Core Terms

air, emission, opacity, tribe, air quality,

malfunction, plant, tar, implementation plan,

promulgate, affirmative defense, pollutant,

tribal, state plan, startup, shutdown,

environmentalist, pollution control, agency’s

action, attainment, capricious, longstanding,

deference, tribal authority rule, stringent,

fugitive, saturate, stack, dust, rulemaking

Case Summary

Procedural Posture

Petitioner, an owner of a power plant on an

Indian reservation, sued respondent, the U.S.

Environmental Protection Agency (EPA), to

challenge a regulation promulgated by the EPA

which was known as a source-specific, federal

implementation plan and was enacted pursuant

to §§ 301(a) and (d)(4) (42 U.S.C.S. §§ 7601(a)

and (d)(4)) of the Clean Air Act. Intervenor

environmentalists also challenged the regulation.

The EPA sought a remand.

Overview

No party opposed the EPA’s motion for

voluntary remand of the fugitive dust limit under

40 C.F.R. § 49.23(d)(3), and the limit was

severable; therefore, a remand was appropriate.

As for the plan itself, petitioner argued that it

was overly restrictive, while intervenors

contended it was not sufficiently stringent.

Intervenors asserted that the EPA had to conduct

the same modeling and analysis as required for

states and tribes. The tribal authority rule (TAR)

did not treat tribes as states for all matters under

the Clean Air Act. 40 C.F.R. § 49.11(a) did not

impose upon the EPA the duty intervenors

proposed. The plan was adequate because it was

but a stricter version of the satisfactory

emissions limits already applied under a state

plan. As for petitioner’s challenges, it waived

any challenge to the particulate matter limit

because it did not contest the rationality of the

limit during the comment period, and its other

arguments lacked merit. The EPA provided a

reasoned basis for the 20% opacity limit. The

EPA’s inclusion of emissions during

malfunctions was consistent with longstanding

EPA policy, and it established an adequate

rationale for providing the affirmative defense.

Outcome

The court granted the EPA’s motion for

voluntary remand and vacated and remanded the

federal implementation plan insofar as it

pertained to the fugitive dust limit. The court

Ann Lyons
denied both petitions for review and affirmed the

remainder of the federal implementation plan.

LexisNexis® Headnotes

Environmental Law > Air Quality > National Ambient

Air Quality Standards

HN1 The Clean Air Act charges the U.S.

Environmental Protection Agency with

implementing and overseeing national ambient

air quality standards (′′national air standards′′)

for air pollutants that cause or contribute to air

pollution which may reasonably be anticipated

to endanger public health or welfare. 42 U.S.C.S.

§§ 7408(a)(1)(A), 7409.

Environmental Law > Air Quality > Enforcement >

General Overview

Environmental Law > Air Quality > State

Implementation Plans

HN2 Under § 110 (42 U.S.C.S. § 7410(a)(2)(A))

of the Clean Air Act, States must enact state

implementation plans (state plan) as may be

necessary or appropriate to meet the applicable

national air standards, subject to U.S.

Environmental Protection Agency (EPA)

approval. State plans approved by the EPA are

federally enforceable. If a state fails to submit an

adequate plan within the applicable time frame,

the EPA must promulgate a federal plan for the

state within two years of the failure.

Environmental Law > Air Quality > Enforcement >

General Overview

Governments > Native Americans > General Overview

HN3 Section 301(d) (42 U.S.C.S. § 7601(d)(2))

of the Clean Air Act addresses the role of

Native-American tribes and authorizes the U.S.

Environmental Protection Agency (EPA) to

specify those provisions of the Act for which it is

appropriate to treat Indian tribes as States.

Where the EPA determines that the treatment of

Indian tribes as States is inappropriate or

administratively infeasible, the EPA may

provide, by regulation, other means by which the

EPA will directly administer such provisions so

as to achieve the appropriate purpose. 42

U.S.C.S. § 7601(d)(4). In 1998, the EPA adopted

what is known as the tribal authority rule to

implement its § 301 authority under the Act.

Environmental Law > Air Quality > General Overview

Governments > Native Americans > General Overview

HN4 The tribal authority rule (TAR) treats tribes

as states for most provisions of the Clean Air Act

and implementing regulations. The TAR does

not treat tribes as states, however, for the

mandatory plan submission deadlines, funding

restrictions, and related federal oversight

mechanisms triggered by a state’s failure to

submit an adequate plan. Tribes may choose, but

are not required, to adopt tribal implementation

plans (tribal plan) for their reservations. Because

tribes are not required to adopt tribal plans, the

TAR authorizes the U.S. Environmental

Protection Agency to promulgate federal plans to

fill any regulatory gaps.

Environmental Law > Air Quality > Enforcement >

General Overview

Governments > Native Americans > General Overview

HN5 The tribal authority rule under the Clean

Air Act provides that the U.S. Environmental

Protection Agency (EPA), pursuant to its explicit

′′discretionary authority′′ under § 301(a) and

(d)(4) of the Act, shall promulgate without

unreasonable delay such Federal implementation

plan provisions as are necessary or appropriate

to protect air quality, consistent with the

provisions of §§ 304(a) and 301(d)(4), if a tribe

does not submit a tribal implementation plan

meeting the completeness criteria of 40 CFR

part 51, Appendix V, or does not receive EPA

approval of a submitted tribal implementation

plan. 40 C.F.R. § 49.11(a).

Administrative Law > Judicial Review > Standards of

Review > Rule Interpretation

HN6 A court may partially set aside a regulation

if the invalid portion is severable. A regulation is

severable if the severed parts operate entirely

independently of one another, and the

circumstances indicate the agency would have

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Ann Lyons
adopted the regulation even without the faulty

provision.

Administrative Law > Judicial Review > Standards of

Review > Clearly Erroneous Standard of Review

HN7 The function of a reviewing court ends

when an error of law is laid bare.

Administrative Law > Judicial Review > Remedies >

Mandamus

HN8 Mandamus may afford a remedy for undue

delay.

Administrative Law > Judicial Review > Remedies >

Mandamus

HN9 See 5 U.S.C.S. § 706(a).

Administrative Law > Judicial Review > Standards of

Review > Arbitrary & Capricious Standard of Review

Administrative Law > Judicial Review > Standards of

Review > Exceeding Statutory Authority

Administrative Law > Judicial Review > Standards of

Review > Unlawful Procedures

HN10 A reviewing court will not set aside

agency action unless it is procedurally defective,

arbitrary or capricious in substance, or

manifestly contrary to the statute.

Administrative Law > Judicial Review > Standards of

Review > Arbitrary & Capricious Standard of Review

HN11 Under the arbitrary or capricious

standard, a reviewing court must determine

whether an agency considered the relevant data

and rationally explained its decision.

Administrative Law > Judicial Review > Standards of

Review > Arbitrary & Capricious Standard of Review

HN12 Agency action is arbitrary or capricious if

the agency has relied on factors which Congress

has not intended it to consider, entirely failed to

consider an important aspect of the problem,

offered an explanation for its decision that runs

counter to the evidence before the agency, or is

so implausible that it could not be ascribed to a

difference in view or the product of agency

expertise.

Administrative Law > Judicial Review > Standards of

Review > General Overview

HN13 While a reviewing court’s inquiry into the

basis of an agency’s action is searching and

careful, the court’s review is ultimately a narrow

one. A court will not set aside agency action on

account of a less-than-ideal explanation as long

as the agency’s decisionmaking process may

reasonably be discerned.

Administrative Law > Judicial Review > Standards of

Review > Deference to Agency Statutory Interpretation

Environmental Law > Air Quality > Emission

Standards > General Overview

HN14 A court reviews the U.S. Environmental

Protection Agency’s interpretation of the Clean

Air Act, a statute it administers, under the

standard set forth in Chevron U.S.A. , Inc. v.

Natural Resources Defense Council, Inc. If the

statute is clear, the court applies its plain

meaning and the inquiry ends. If the statute is

silent or ambiguous about the question at issue,

the court defers to the authorized agency and

applies the agency’s construction so long as it is

a reasonable interpretation of the statute.

Administrative Law > Judicial Review > Standards of

Review > Rule Interpretation

HN15 An agency is entitled to substantial

deference when it acts pursuant to an

interpretation of its own regulation. The

agency’s interpretation is controlling unless

plainly erroneous or inconsistent with the

regulation.

Administrative Law > Judicial Review > Standards of

Review > Rule Interpretation

Administrative Law > Judicial Review > Standards of

Review > Deference to Agency Statutory Interpretation

Environmental Law > Air Quality > Enforcement >

General Overview

HN16 Congress delegated to the U.S.

Environmental Protection Agency (EPA) the

authority to promulgate regulations as necessary

to carry out the objectives of the Clean Air Act.

42 U.S.C.S. § 7601(a). Congress also granted the

EPA discretion to treat Native American tribes

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Ann Lyons
as states and provide, by regulation, other means

of protecting air quality in the absence of

approved tribal plans. § 7601(d). The EPA

exercised this authority in promulgating the

tribal authority rule (TAR), which led to the

source-specific federal plan at issue. Thus, the

EPA’s actions are entitled to Chevron deference,

and the EPA’s interpretation of the TAR, its own

regulation, is controlling unless plainly

erroneous or inconsistent with the plain meaning

of the regulation.

Environmental Law > Air Quality > Enforcement >

General Overview

HN17 The Clean Air Act requires the U.S.

Environmental Protection Agency (EPA) to

protect public health and welfare from any

actual or potential adverse effect which in the

EPA’s judgment may reasonably be anticipated

to occur from air pollution, notwithstanding

attainment and maintenance of all national air

standards, 42 U.S.C.S. § 7470.

Environmental Law > Air Quality > Emission

Standards > General Overview

Environmental Law > Air Quality > State

Implementation Plans

Governments > Native Americans > General Overview

HN18 The tribal authority rule treats tribes as

states for most provisions of the Clean Air Act

and implementing regulations. 40 C.F.R. § 49.3.

But it does not treat tribes as states for the

mandatory plan submission deadlines, funding

restrictions, and related federal oversight

mechanisms triggered by a state’s failure to

submit an adequate plan. 40 C.F.R. § 49.4(a), (d)

and (q). Tribes may choose, but are not required,

to adopt plans for their reservations.

Environmental Law > Air Quality > Enforcement >

General Overview

Governments > Native Americans > General Overview

HN19 Section 301(a)(1) (42 U.S.C. §

7601(a)(1)) of the Clean Air Act authorizes the

U.S. Environmental Protection Agency (EPA) to

prescribe such regulations as are necessary to

carry out the Act, and § 301(d)(4) (42 U.S.C. §

7601(d)(4)) authorizes the EPA to administer

directly the Act’s provisions for which the

agency has determined it is inappropriate or

infeasible to treat tribes as states.

Administrative Law > Agency Rulemaking > General

Overview

Environmental Law > Air Quality > State

Implementation Plans

HN20 40 C.F.R. pt. 51, app. V, requires, inter

alia, that state plans submitted to the U.S.

Environmental Protection Agency include

modeling information required to support the

proposed revision, including input data, output

data, models used, justification of model

selections, ambient monitoring data used,

meteorological data used, assumptions, and

other information relevant to the determination

of adequacy of the modeling analysis.

Administrative Law > Agency Rulemaking > General

Overview

Environmental Law > Air Quality > Enforcement >

General Overview

Governments > Native Americans > General Overview

HN21 40 C.F.R. § 49.11(a) provides the U.S.

Environmental Protection Agency (EPA)

discretion to determine what rulemaking is

necessary or appropriate to protect air quality

and requires the EPA to promulgate such

rulemaking. Nothing in 40 C.F.R. § 49.11(a)

requires the EPA -- as opposed to a tribe -- to

submit a plan meeting the completeness criteria

of Appendix V. Similarly, 40 C.F.R. § 49.11(a)

does not prevent the EPA from relying on

current air quality monitoring data which shows

the region is well within national air standards.

Environmental Law > Air Quality > Enforcement >

General Overview

Governments > Native Americans > General Overview

HN22 That another section of the Clean Air Act

requires states to regulate emissions as may be

necessary or appropriate to meet national air

standards does not negate the U.S.

Environmental Protection Agency’s explicit

intent in promulgating the tribal authority rule.

42 U.S.C.S. § 7410(a).

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Ann Lyons
Environmental Law > Air Quality > Emission

Standards > General Overview

Environmental Law > Air Quality > National Ambient

Air Quality Standards

HN23 The key criterion in determining the

adequacy of any plan is attainment and

maintenance of the national air standards. 42

U.S.C.S. §§ 7410(a) and 7602(y).

Administrative Law > Judicial Review >

Reviewability > Exhaustion of Remedies

Administrative Law > Judicial Review >

Reviewability > Preservation for Review

HN24 A court will not entertain arguments

which should have properly been made before

the agency in the first instance.

Administrative Law > Judicial Review >

Reviewability > Preservation for Review

HN25 Generalized objections to agency action

will not do. An objection to the agency must be

made with sufficient specificity reasonably to

alert the agency in order to preserve the issue for

appeal.

Administrative Law > Judicial Review >

Reviewability > Preservation for Review

HN26 An agency must respond only to relevant

comments about agency action, which cast doubt

on the reasonableness of a position taken by the

agency.

Administrative Law > Judicial Review >

Reviewability > Exhaustion of Remedies

HN27 A longstanding policy of the U.S.

Environmental Protection Agency makes clear

that excess emissions resulting from

malfunctions are violations of the Clean Air Act,

for such emissions can interfere with attainment

of the national air standards. 72 Fed. Reg.

25,702, 25,705 (Feb. 15, 1983). The

longstanding policy grants a limited affirmative

defense where interference with national air

standards will not occur and injunctive relief is

still available as an enforcement mechanism.

Environmental Law > Air Quality > Emission

Standards > General Overview

Environmental Law > Air Quality > Enforcement >

General Overview

HN28 The U.S. Environmental Protection

Agency’s (EPA’s) treatment of malfunction

events is not inconsistent with its treatment of

startup and shutdown episodes. The EPA’s

longstanding policy applies ′′alternate limits′′ to

excess emissions resulting from these

infrequent, reasonably foreseeable episodes,

where a source’s pollution control equipment is

technically incapable of meeting the emissions

limits for a defined period of time. 72 Fed. Reg.

25,702 (Feb. 15, 1983). The EPA has reiterated

that bypassing the pollution control equipment

during startup and shutdown episodes may be

necessary to avoid loss of life, personal injury, or

severe property damage.

Environmental Law > Air Quality > Emission

Standards > General Overview

Environmental Law > Air Quality > Enforcement >

General Overview

HN29 The U.S. Environmental Policy Agency’s

(EPA) longstanding policy explicitly states that a

limited affirmative defense to penalties for

malfunctions may be available where

interference with the national air standards will

not occur. Thus, the EPA interprets the Clean Air

Act as allowing a limited affirmative defense

only in situations where attainment will not be

detrimentally affected.

Environmental Law > Air Quality > Emission

Standards > General Overview

Environmental Law > Air Quality > State

Implementation Plans

Governments > Native Americans > General Overview

HN30 There is no requirement that a gap-filling

federal plan can be only as strict as necessary to

meet national air standards. The Clean Air Act

and the tribal authority rule certainly do not

include such a mandate. States, and presumably

tribes, may surpass national air standards as long

as their plans satisfy all of the minimal Clean Air

Act requirements.

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Ann Lyons
Counsel: Thomas Sayre Llewellyn of

Washington, D.C. (07-9546), for Petitioner

ArizonaPublicService Company.

David A. Carson (Ronald J. Tenpas, Assistant

Attorney General (07-9546); John C. Cruden,

Deputy Assistant Attorney General, with him on

the consolidated brief), United States

Department of Justice, Environment and Natural

Resources Division, Denver, Colorado, for

Respondent Environmental Protection Agency.

Matt Kenna (07-9546), Western Environmental

Law Center, Durango, Colorado, for Intervenors

Sierra Club, Dine Care, Dine for the C-Aquifer,

and San Juan Citizens Alliance.

Matt Kenna (07-9547), Western Environmental

Law Center, Durango, Colorado, for Petitioners

Sierra Club, Dine Care, Dine for the C-Aquifer,

and San Juan Citizens Alliance.

David A. Carson (Ronald J. Tenpas, Assistant

Attorney General (07-9547); John C. Cruden,

Deputy Assistant Attorney General, with him on

the consolidated brief), United States

Department of Justice, Environment and Natural

Resources Division, Denver, Colorado, for

Respondent Environmental Protection Agency.

Thomas Sayre Llewellyn of Washington, D.C.

(07-9547), [**2] for Intervenor

ArizonaPublicService Company.

Judges: Before MCCONNELL, SEYMOUR

and HOLMES, Circuit Judges.

Opinion by: SEYMOUR

Opinion

[*1118] SEYMOUR, Circuit Judge.

ArizonaPublicService Company (′′APS′′),

operator and majority owner of the Four Corners

Power Plant (′′Plant′′), and Sierra Club, Dine

CARE, Dine for the C-Aquifer, and San Juan

Citizens Alliance (collectively

′′Environmentalists′′) challenge a regulation

promulgated by the U.S. Environmental

Protection Agency (′′EPA′′). The regulation at

issue is known as a source-specific, federal

implementation plan (′′federal plan′′) and was

enacted pursuant to sections 301(a) and (d)(4) of

the Clean Air Act, 42 U.S.C. §§ 7601(a) and

(d)(4). The federal plan limits particular air

emissions from the Plant. We have jurisdiction

pursuant to section 307(b)(1) of the Act, 42

U.S.C. § 7607(b)(1). Because all parties agree

that the federal plan provision pertaining to

fugitive dust should be remanded, see infra Part

II, we do not address this emissions limit in our

discussion of the facts. We grant the EPA’s

motion for voluntary remand and grant in part

and deny in part the petitions for review.

I.

The purpose of the Clean Air Act is to control

and improve the nation’s air quality through

[**3] a combination of state and federal

regulation. HN1 The Clean Air Act charges the

EPA with implementing and overseeing national

ambient air quality standards (′′national air

standards′′) for air pollutants that ′′cause or

contribute to air pollution which may reasonably

be anticipated to endanger public health or

welfare.′′ 42 U.S.C. § 7408(a)(1)(A); see id. §

7409.

[*1119] The Plant, a coal-fired power facility

located on the Navajo reservation in northwest

New Mexico, emits regulated or ′′criteria′′

pollutants. These criteria pollutants include

sulfur dioxide (′′SO[2]′′), particulate matter

(′′PM′′), and nitrogen oxides (′′NO[x]′′). To

control emissions of these pollutants, the Plant’s

five steam generating units employ air pollution

control equipment. The Plant also uses

federally-mandated continuous opacity

monitoring systems (′′COMS′′), which monitor

the opacity levels of emissions. Opacity, i.e.,

[**4] the opaqueness or cloudiness of

emissions, is not a criteria pollutant but,

according to the EPA, can indicate whether

pollution control equipment is properly

functioning and whether an emissions limit is

being maintained. Data shows that air quality in

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Ann Lyons
the area of the Plant is better than the national air

standards.

HN2 Under section 110 of the Act, states must

enact state implementation plans (′′state plan′′)

′′as may be necessary or appropriate to meet the

applicable′′ national air standards, subject to

EPA approval. 42 U.S.C. § 7410(a)(2)(A). State

plans approved by the EPA are federally

enforceable. If a state fails to submit an adequate

plan within the applicable time frame, the EPA

must promulgate a federal plan for the state

within two years of the failure. The EPA had

previously approved New Mexico’s state plan,

which limits emissions of criteria pollutants

from coal-burning power plants. The EPA

determined the New Mexico plan does not apply

to the Plant because of its location on Navajo

land. The Plant nonetheless has complied,

continuously and voluntarily, with the New

Mexico plan. The New Mexico plan does not

limit opacity and exempts excess emissions

during startup, shutdown, and

[**5] malfunction.

HN3 Section 301(d) of the Act addresses the role

of Native-American tribes and authorizes the

EPA to ′′specify[] those provisions of [the Act]

for which it is appropriate to treat Indian tribes

as States.′′ 42 U.S.C. § 7601(d)(2). Where the

EPA ′′determines that the treatment of Indian

tribes as . . . States is inappropriate or

administratively infeasible, the [EPA] may

provide, by regulation, other means by which the

[EPA] will directly administer such provisions

so as to achieve the appropriate purpose.′′ Id. §

7601(d)(4). In 1998, the EPA adopted what is

known as the tribal authority rule (′′TAR′′) to

implement its section 301 authority under the

Act. HN4 The TAR treats tribes as states for

most provisions of the Clean Air Act and

implementing regulations. The TAR does not

treat tribes as states, however, for the mandatory

plan submission deadlines, funding restrictions,

and related federal oversight mechanisms

triggered by a state’s failure to submit an

adequate plan. Tribes may choose, but are not

required, to adopt tribal implementation plans

(′′tribal plan′′) for their reservations. Because

tribes are not required to adopt tribal plans, the

TAR authorizes the EPA to promulgate federal

[**6] plans to fill any regulatory gaps. HN5 The

TAR provides that the EPA, pursuant to its

explicit ′′discretionary authority′′ under sections

301(a) and (d)(4) of the Act,

[s]hall promulgate without

unreasonable delay such Federal

implementation plan provisions as are

necessary or appropriate to protect air

quality, consistent with the provisions

of sections 304(a) 1

and 301(d)(4), if a

tribe does not submit a tribal

implementation plan meeting the

completeness criteria of 40 CFR part

51, Appendix V, or does not [*1120]

receive EPA approval of a submitted

tribal implementation plan.

40 C.F.R. § 49.11(a).

Here, the Navajo Nation did not submit a tribal

plan, and the Plant’s emissions remained

officially unregulated, although the Plant

voluntarily complied with the New Mexico plan.

To remedy the regulatory gap, the EPA proposed

a source-specific federal plan for the Plant. The

EPA initially consulted with the Navajo Nation,

APS, and the State of New Mexico. The EPA

planned to adopt a federal plan that essentially

would federalize the requirements of the New

Mexico plan historically followed by the Plant

and, in some instances, modify the state plan to

ensure comprehensive emissions control and

federal consistency. [**7] The EPA published

the proposed federal plan in 1999 and solicited

public comment.

In 2006, the EPA published a revised proposed

plan and again solicited public comment. The

EPA believed regional air quality would ′′be

positively impacted′′ by the proposed action, as

1

Section 49.11(a) mistakenly refers to section 304(a), instead of 301(a).

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Ann Lyons
the proposal was ′′more stringent than, or at least

as stringent as, the emissions limitations with

which [the Plant] ha[d] historically complied.′′

Source-Specific Federal Implementation Plan

for Four Corners Plant; Navajo Nation, 71 Fed.

Reg. 53,631, at 53,631 (Sept. 12, 2006) (to be

codified at 40 C.F.R. pt. 49). The proposal

limited the Plant’s emissions of particular

criteria pollutants and, relevant to the instant

matter, included a 20% opacity limit for two of

the Plant’s steam generating units, Units 4 and 5.

The opacity limit allowed ′′for one six-minute

period per hour of not more than 27 percent

opacity, excluding water vapor.′′ Id. at 53,633.

The opacity and other emissions limits generally

did not apply during startup, shutdown, or

saturated stack conditions, but did apply during

periods of malfunction. The proposal gave APS

a limited affirmative defense to claims for

penalties brought for excess emissions caused

[**8] by malfunctions.

APS filed comments on the proposed federal

plan, two of which are relevant. First, APS

commented that the Plant’s emissions during

malfunctions should be exempt rather than

subject to an affirmative defense. APS argued

the law does not require limiting emissions

during malfunctions, particularly when no

specific justification for the limits existed. APS

claimed the definition of malfunction was unfair

and irrational, and the affirmative defense

improperly shifted the burden of proof. Second,

APS objected to the 20% opacity limit as

written. It claimed the limit was not achievable,

even during periods of best operating practices

and proper equipment operation. Based on

APS’s statistical analysis of data from its

monitoring systems, APS contended the opacity

limit had to include a .2% allowance for

′′periodic exceedances.′′ J.A. at 292. The Plant,

APS asserted, could meet the proposed limit

only 99.8% of the time. APS noted the EPA had

approved an exceedance of up to .8% in a

revision to a North Carolina state plan. APS

added, ′′[t]here is no air quality analysis

establishing that [] a [20% opacity] [**9] limit

is necessary to attainment and maintenance of

any air quality standard, nor is there any other

legal basis for such a requirement.′′ Id.

The Environmentalists also commented on the

proposal. They contended, inter alia, that the

proposed federal plan must satisfy the state plan

completeness criteria. The proposal was

′′unacceptable′′ because the EPA did not justify

its chosen emissions limits with ′′state-of-the-art

dispersion modeling to guarantee, at a minimum,

the maintenance and attainment of national and

state ambient air quality standards and the

prevention of significant deterioration

increments.′′ Id. at 201-02. [*1121] According

to the Environmentalists, the EPA could not rely

on the New Mexico plan alone in formulating a

new federal plan for the Plant. More stringent

emissions limits were required.

The EPA promulgated the finalized federal plan

in May 2007. The plan limits the Plant’s

emissions of specific criteria pollutants, as well

as opacity. The EPA’s basis for the plan is: (i) to

make federally enforceable the emissions limits

the Plant has historically followed, (ii) to ensure

the Plant continues to reduce its emissions of

criteria pollutants, (iii) to guarantee continued

maintenance [**10] of air quality standards and

protection of visibility in the area, and (iv) to

maintain consistent standards between the

Navajo Nation and its neighboring states.

Opacity for Units 4 and 5 is limited to 20%,

averaged over any six-minute period, excluding

uncombined water droplets and one six-minute

period per hour of not more than 27% opacity.

However, if pollution control equipment is

operating normally and not fully closed and a

high opacity reading occurs, the EPA presumes

saturated stack conditions caused the occurrence

and will not consider it a violation. Although the

EPA did not explicitly address APS’s .2%

requested allowance, it did explain that

′′[o]pacity limits are generally applied to ensure

a source is meeting its [criteria pollutant]

emissions limit.′′ Source-Specific Federal

Implementation Plan for Four Corners Power

Plant; Navajo Nation, 72 Fed. Reg. 25,698, at

25,701 (May 7, 2007) (to be codified at 40

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Ann Lyons
C.F.R. pt. 49). The EPA added, ′′The opacity

limit for this facility is set to assure proper

operation of [pollution control equipment].′′ Id.

As in the 2006 proposal, the emissions limits

generally do not apply during startup, shut down,

or saturated stack conditions, [**11] but do

apply during periods of malfunction. 2 The EPA

contends its treatment of malfunction events is

consistent with its ′′longstanding position, as

reflected in numerous policy documents and

rulemakings.′′ Id. at 25,702. The plan also

includes the affirmative defense to claims for

penalties brought for excess emissions caused by

malfunctions.

In these consolidated appeals, APS contends that

the federal plan is overly restrictive, and the

Environmentalists contend it is not sufficiently

stringent. APS argues the plan is arbitrary and

capricious because, among other things, the EPA

did not explain why it chose the particular

opacity limit that it did. According to APS, the

Plant cannot meet the 20% opacity limit with its

existing pollution control equipment, and the

EPA has identified no exigency or logical reason

[**12] to justify its rejection of APS’s proposed

modifications to the limit. The

Environmentalists argue, by contrast, that the

plan is arbitrary and capricious because the EPA

did not conduct modeling and air quality

analysis as required by the Clean Air Act. The

Environmentalists want the EPA to enact a new

plan on remand that places greater restrictions on

the pollution emitted by the Plant. 3

II.

Before turning to the parties’ arguments, we first

address the EPA’s motion [*1122] for

voluntary remand of the fugitive dust limit, 40

C.F.R. § 49.23(d)(3). The EPA and APS ask us to

remand and vacate this provision, which does

not affect the validity of the remainder of the

federal plan, because the EPA did not adequately

explain its rationale for imposing the limit. The

Environmentalists appear to support remand and

do not appear to oppose vacation of the

provision. They ask only that we order the EPA

to reconsider [**13] the fugitive dust limit

′′within a time certain′′ following remand.

Environmentalists’ Response to EPA’s Motion

for Voluntary Remand at 3.

HN6 We may partially set aside a regulation if

the invalid portion is severable. A regulation is

severable if the severed parts ′′operate entirely

independently of one another,′′ and the

circumstances indicate the agency would have

adopted the regulation even without the faulty

provision. Davis County Solid Waste Mgmt. v.

EPA, 323 U.S. App. D.C. 425, 108 F.3d 1454,

1459 (D.C. Cir. 1997). Here, the fugitive dust

limit and the remaining provisions of the plan

operate independently of one another; the

functionality of the plan does not depend on

enforcement of the fugitive dust limit. The plan

went into effect on November 13, 2008, but

enforcement of the fugitive dust limit has been

stayed pending our decision. That the EPA

requested voluntary remand of the limit, as well

as implemented the stay, suggests the agency

would have promulgated the plan even without

the limit. We conclude the fugitive dust limit is

severable and should be remanded and vacated,

as no party opposes the narrow scope of this

remedy.

We decline to set a time limit on the EPA’s

course of action on remand. The

[**14] Environmentalists point to no authority

permitting entry of such an order, and we cannot

ignore the general principle that HN7 ′′[t]he

2

′′Malfunction means any sudden and unavoidable failure of air pollution control equipment or process equipment or of a

process to operate in a normal or usual manner. Failures that are caused entirely or in part by poor maintenance, careless operation,

or any other preventable upset condition or preventable equipment breakdown shall not be considered malfunctions.′′ Id. at

25,705.

3 APS questions our jurisdiction over the Environmentalists’ challenge because of the wording of the relief they requested. We

reject this argument: the Environmentalists’ challenge necessarily includes a remand request for reconsideration of the rulemaking,

which is within our jurisdiction.

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function of the reviewing court ends when an

error of law is laid bare.′′ Fed. Power Comm’n v.

Idaho Power Co., 344 U.S. 17, 20, 73 S. Ct. 85,

97 L. Ed. 15 (1952). To the extent concern exists

about the EPA’s diligence on remand, HN8

mandamus may afford a remedy for undue delay.

See NRDC v. EPA, 376 U.S. App. D.C. 528, 489

F.3d 1364, 1375 (D.C. Cir. 2007); see5 U.S.C. §

706(1) (HN9 ′′The reviewing court shall . . .

compel agency action unlawfully withheld or

unreasonably delayed . . . .′′).

III.

Our review of the federal plan is governed by the

Administrative Procedure Act, 5 U.S.C. § 706.

4HN10 We will not set aside agency action

unless it is ′′procedurally defective, arbitrary or

capricious in substance, or manifestly contrary

to the statute.′′ United States v. Mead Corp., 533

U.S. 218, 227, 121 S. Ct. 2164, 150 L. Ed. 2d 292

(2001); see Olenhouse v. Commodity Credit

Corp., 42 F.3d 1560, 1574 (10th Cir. 1994).

HN11 Under the arbitrary or capricious

standard, we must determine whether the agency

considered the relevant data and rationally

explained its decision. Olenhouse, [*1123] 42

F.3d at 1574. HN12 Agency action is arbitrary or

capricious ′′if the agency [**15] has relied on

factors which Congress has not intended it to

consider, entirely failed to consider an important

aspect of the problem, offered an explanation for

its decision that runs counter to the evidence

before the agency, or is so implausible that it

could not be ascribed to a difference in view or

the product of agency expertise.′′ Motor Vehicle

Mfrs. Ass’n v. State Farm Mut., 463 U.S. 29, 43,

103 S. Ct. 2856, 77 L. Ed. 2d 443 (1983). HN13

While our inquiry into the basis of the agency’s

action is ′′searching and careful, our review is

ultimately a narrow one.′′ Maier v. EPA, 114

F.3d 1032, 1039 (10th Cir. 1997). We will not set

aside agency action on account of a

less-than-ideal explanation as long as the

agency’s decisionmaking process may

reasonably be discerned. Alaska Dep’t of Envtl.

Conservation, 540 U.S. at 497.

HN14 We review the EPA’s interpretation of the

Clean Air Act, a statute it administers, under the

standard set forth in Chevron U.S.A., Inc. v.

Natural Resources Defense Council, Inc., 467

U.S. 837 (1984). ′′If the statute is clear, we apply

its plain meaning′′ and the inquiry ends. Qwest

Corp. v. FCC, 258 F.3d 1191, 1199 (10th Cir.

2001) (citing Chevron, 467 U.S. at 843). If the

statute is silent or ambiguous about the question

at issue, as here, we defer to the authorized

agency and ′′apply the agency’s construction so

long as it is a reasonable interpretation of the

statute.′′ Id. (citing Chevron, 467 U.S. at

843-44). HN15 An agency is entitled to

substantial deference when it acts pursuant to an

interpretation [**17] of its own regulation.

Culbertson v. U.S. Dep’t of Agric., 69 F.3d 465,

467 (10th Cir. 1995); see Gonzales v. Oregon,

546 U.S. 243, 255, 126 S. Ct. 904, 163 L. Ed. 2d

748 (2006) (′′An administrative rule may receive

substantial deference if it interprets the issuing

agency’s own ambiguous regulation.′′). The

agency’s interpretation is ′′controlling unless

plainly erroneous or inconsistent with the

regulation.′′ Gonzales, 546 U.S. at 256 (quoting

Auer v. Robbins, 519 U.S. 452, 461, 117 S. Ct.

905, 137 L. Ed. 2d 79 (1997)); see Thomas

Jefferson Univ. v. Shalala, 512 U.S. 504, 512,

114 S. Ct. 2381, 129 L. Ed. 2d 405 (1994)

(applying ′′plainly erroneous or inconsistent with

the regulation′′ standard); Bowles v. Seminole

Rock & Sand Co., 325 U.S. 410, 414, 65 S. Ct.

1215, 89 L. Ed. 1700 (1945) (same); Excel Corp.

4 APS claims we should review the federal plan under section 307(d)(9) of the Clean Air Act, 42 U.S.C. § 7607(d)(9). APS is

incorrect. Section 307(d) applies only to certain EPA rulemakings, and does not include the EPA’s promulgation of the plan here.

See42 U.S.C. § 7607(d) (listing the promulgations to which section 307(d) applies); see also Alaska Dep’t of Envtl. Conservation

v. EPA, 540 U.S. 461, 497 n.18, 124 S. Ct. 983, 157 L. Ed. 2d 967 (2004); [**16] Am. Forest & Paper Ass’n Inc. v. EPA,

352 U.S. App. D.C. 315, 294 F.3d 113, 116 n.3 (D.C. Cir. 2002). This is not a case, moreover, where the EPA has determined

section 307(d) applies. Cf. North Carolina v. EPA, 382 U.S. App. D.C. 167, 531 F.3d 896, 906 (D.C. Cir. 2008) (reviewing the EPA’s

action under the Clean Air Act instead of the Administrative Procedure Act, because the EPA specified section 307(d) applied

to ′′all components′′ of its rulemaking). In any event, APS concedes the two standards are ′′essentially the same.′′ Aplt. Br. at 23.

Page 10 of 17

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Ann Lyons
v. U.S. Dep’t of Agric., 397 F.3d 1285, 1295

(10th Cir. 2005) (same). 5

HN16 Congress delegated to the EPA the

authority to promulgate regulations as necessary

to carry out the objectives of the Clean Air Act.

See42 U.S.C. § 7601(a). Congress also granted

the EPA discretion to treat Native American

tribes as states [*1124] and provide, by

regulation, other means of protecting air quality

in the absence of approved tribal plans. Id. §

7601(d). The EPA exercised this authority in

promulgating the TAR, which led to the

source-specific federal plan at issue. Thus, the

EPA’s [**19] actions are entitled to Chevron

deference, and the EPA’s interpretation of the

TAR, its own regulation, is controlling unless

plainly erroneous or inconsistent with the plain

meaning of the regulation.

The EPA argues we should affirm the federal

plan. The TAR, the EPA asserts, allows a federal

plan to be a codification of a

previously-approved state plan. Contrary to the

Environmentalists, the EPA interprets the TAR

as permitting the agency to take limited action to

fill a regulatory gap without having to conduct

extensive, area-wide modeling and analysis. The

EPA also maintains that it provided a reasoned

explanation for its decision to apply the 20%

opacity limit to Units 4 and 5. The opacity limit

ensures that pollution control equipment is

properly functioning and that the Units

continuously comply with emissions limits. The

EPA further claims it reasonably rejected APS’s

recommendations for a .2% allowance and

exemption for malfunction exceedances.

We address first the EPA’s gap-filling authority

under the Clean Air Act and TAR. We then turn

to the 20% opacity limit and the EPA’s rejection

of APS’s proposed modifications.

A.

The underlying theme in the Environmentalists’

challenge [**20] is that the federal plan is

unlawful because it fails to improve sufficiently

the air quality in the area surrounding the Plant.

The Environmentalists note HN17 the Clean Air

Act requires the EPA ′′to protect public health

and welfare from any actual or potential adverse

effect which in the [EPA]’s judgment may

reasonably be anticipate[d] to occur from air

pollution . . ., notwithstanding attainment and

maintenance of all [national air standards],′′ 42

U.S.C. § 7470. The Environmentalists argue the

′′whole point′′ of an implementation plan is to

analyze air quality problems, identify their

sources, and minimize those problems.

According to the Environmentalists, (i) the

TAR’s preamble, (ii) its plain language and use

of the conjunctive phrase ′′necessary or

appropriate,′′ and (iii) a similar provision of the

Clean Air Act regarding state plans make clear

that the TAR does not allow the EPA simply to

codify the status quo with no new assessment of

air quality. They also contend that because

almost all of the substantive requirements of

state plans apply to tribal plans, any gap-filling

federal plan must also have the ′′same

substantive requirements applicable to [state

plans], which require monitoring,

[**21] modeling and air quality assessments

necessary to determine the emissions limitations

needed to protect regional air quality.′′ Reply Br.

at 2.

At bottom, the Environmentalists argue the TAR

requires the EPA to implement a more stringent

5 We note some of our decisions apply a slightly different standard, asking whether the agency’s interpretation is ′′unreasonable,

plainly erroneous, or inconsistent with the regulation’s plain meaning.′′ See, e.g., Via Christi Reg. Med. Ctr., Inc. v. Leavitt, 509

F.3d 1259, 1272-73 (10th Cir. 2007) (emphasis added); Utah Envtl. Congress v. Richmond, 483 F.3d 1127, 1134 (10th Cir. 2007);

Utah Envtl. Congress v. Bosworth, 443 F.3d 732, 739 (10th Cir. 2006). [**18] It appears this standard is a combination of the

plainly erroneous and reasonableness inquiries. See Bar MK Ranches v. Yuetter, 994 F.2d 735, 738 (10th Cir. 1993) (citing Downtown

Med. Ctr. v. Bowen, 944 F.2d 756, 768 (10th Cir. 1991) (′′Such an administrative interpretation is ordinarily entitled to considerable

deference unless it is plainly inconsistent with the clear meaning of the statute and regulations or unreasonable.′′). The

′′reasonableness′′ standard is applicable to an agency’s interpretation of a statute. See Chevron, 467 U.S. at 843-44. Here, we

apply the more concise ′′plainly erroneous or inconsistent with the regulation′′ standard in light of the Supreme Court’s

pronouncement in Gonzales.

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Ann Lyons
federal plan in order to address adequately all of

the current air problems in the area of the Plant.

Accordingly, they assert, the EPA must satisfy

the same criteria, i.e., conduct the same

modeling and analysis, as required for states and

tribes. The EPA’s only discretion is in choosing

the measures to protect air quality. Because the

EPA failed to address the area’s air problems

and did not examine the relevant data or

articulate a rational basis for its decision, the

federal plan is arbitrary and capricious and fails

to comply with the TAR.

We disagree. HN18 The TAR treats tribes as

states for most provisions of the Clean Air Act

and implementing regulations. See40 C.F.R. §

49.3. But it does not treat tribes [*1125] as

states for the mandatory plan submission

deadlines, funding restrictions, and related

federal oversight mechanisms triggered by a

state’s failure to submit an adequate plan. See40

C.F.R. § 49.4(a), (d) and (q). Tribes may choose,

but are not required, [**22] to adopt plans for

their reservations. The TAR provides that the

EPA, pursuant to its explicit ′′discretionary

authority′′ under sections 301(a) and (d)(4) of the

Clean Air Act,

6

[s]hall promulgate without

unreasonable delay such Federal

implementation plan provisions as are

necessary or appropriate to protect air

quality, consistent with the provisions

of sections 304(a) and 301(d)(4), if a

tribe does not submit a tribal

implementation plan meeting the

completeness criteria of 40 CFR part

51, Appendix V,

7

or does not receive

EPA approval of a submitted tribal

implementation plan.

40 C.F.R. § 49.11(a).

This language does not impose upon the EPA the

duty the Environmentalists propose. HN21 It

provides the EPA discretion to determine what

rulemaking is necessary or appropriate to protect

air quality and requires the EPA to promulgate

such rulemaking. Nothing in section 49.11(a)

requires the EPA -- as opposed to a tribe -- to

submit a plan meeting the completeness criteria

of Appendix V. Similarly, section 49.11(a) does

not prevent the EPA from relying, at it has here,

on current air quality monitoring data which

shows the region is well within national air

standards.

The Environmentalists’ construction is contrary

to the plain language of section 49.11(a). Their

construction would prevent the EPA from

implementing any plan ′′as necessary or

appropriate′′ to protect air quality, absent a

comprehensive analysis of all air quality

problems in an area. Moreover, such a

construction would conflict with the Act’s

definition of a federal plan: ′′The term ’Federal

implementation plan’ means a plan (or portion

thereof) [**24] promulgated by the [EPA] to fill

all or a portion of a gap or otherwise correct all

or a portion of an inadequacy in a State

implementation plan, and which includes

enforceable emission limitations or other control

measures, . . . and provides for attainment of the

relevant national ambient air quality standard.′′

42 U.S.C. § 7602(y). In this instance, some

6 HN19 Section 301(a)(1) of the Clean Air Act, 42 U.S.C. § 7601(a)(1), authorizes the EPA to prescribe such regulations as are

necessary to carry out the Act, and section 301(d)(4), 42 U.S.C. § 7601(d)(4), authorizes the EPA to administer directly the

Act’s provisions for which the agency has determined it is inappropriate or infeasible to treat tribes as states.

7 HN20 Appendix V requires, inter alia, that state plans submitted to the EPA include ′′[m]odeling information required to

support the proposed revision, including input data, output data, models used, justification of model selections, ambient

[**23] monitoring data used, meteorological data used, . . . assumptions, and other information relevant to the determination of

adequacy of the modeling analysis.′′ 40 C.F.R. pt. 51, app. V.

Page 12 of 17

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Ann Lyons
regulation of the Plant is better than none at all.

8

HN22 That another section of the Act requires

states to regulate emissions ′′as may be

necessary or appropriate′′ to meet national air

standards does not negate the EPA’s explicit

intent in promulgating the TAR. 42 U.S.C. §

7410(a). As stated in the preamble of the TAR,

the EPA recognizes that, as compared to states,

tribes are generally in the early stages of

developing air planning [*1126] expertise and

need sufficient time to develop air quality

programs. The EPA’s strategy for implementing

the Clean Air Act on Native [**25] American

reservations is a ′′multi-pronged approach.′′ 63

Fed. Reg. at 7,264. In some cases the EPA takes

a ′′grass-roots′′ approach and works with tribes

to assess air quality problems and to develop

′′either tribal or federal strategies for addressing

the problems.′′ Id. In other cases, the EPA

gap-fills by adopting ′′an average′′ federal plan

based on existing state plan rules. 9

Id. The

preamble emphasizes that federal plans ′′will be

analogous to, but not the same in all respects, as

the types of rules generally approved into [state

plans]. For example, EPA’s [federal plans] are

likely to represent an average program,

potentially more stringent than some [state plan]

rules and less stringent than others.′′ Id. at

7,263-64 (emphasis added). The EPA hoped

′′any additional regulations c[ould] be

promulgated and implemented relatively

quickly′′ under the ′′very broad statutory

authority′′ granted by the Act. Id. at 7,263. The

EPA did not intend to self-impose a duty to

implement all measures otherwise required for

states and tribes.

In sum, HN23 the key criterion in determining

the adequacy of any plan is attainment and

maintenance of the national air standards. See42

U.S.C. §§ 7410(a) and 7602(y); see also Union

Elec. Co. v. EPA, 427 U.S. 246, 265, 96 S. Ct.

2518, 49 L. Ed. 2d 474 (1976) (′′States may

submit implementation plans more stringent than

federal law requires and [] the [EPA] must

approve such plans if they meet the minimum

[Clean Air Act] requirements of § 110(a)(2).′′);

Train v. Natural Res. Def. Council, 421 U.S. 60,

79, 95 S. Ct. 1470, 43 L. Ed. 2d 731 (1975)

(explaining that EPA’s primary responsibility in

approving plans is to determine whether ′′the

ultimate effect of a State’s choice of emission

limitations is compliance with the national

standards for ambient air′′). The federal plan at

issue codifies in part the New Mexico plan --

previously studied, analyzed, approved, and in

place -- and [**27] relies on current data

demonstrating that the air quality in the area of

the Plant is better than the national air standards

for criteria pollutants. Therefore, the EPA had no

need to conduct additional modeling and

analysis to demonstrate the adequacy of the plan,

a fact the EPA already knew. The federal plan,

by necessity, is adequate because the plan is but

a stricter version of the satisfactory emissions

limits already applied by the Plant and

implemented throughout the State of New

Mexico. Because the EPA’s interpretation of its

own regulation is not ′′plainly erroneous or

inconsistent with the regulation,′′ we must defer

to the EPA. Gonzales v. Oregon, 546 U.S. at 256.

We conclude the Environmentalists’ petition

should be denied.

B.

The remaining issue is whether the EPA’s

decision to enact a 20% opacity limit and to

reject APS’s proposed modifications was

8

In fact, the Navajo Nation advised the EPA that ′′it continues to support EPA’s efforts to impose such controls on [the Plant]

as are necessary to ensure continued compliance with the substantive requirements of the New Mexico [state plan] . . . .′′ 64

Fed. Reg. at 48,732-33.

9 An earlier proposed version of the TAR includes a similar edict: ′′Today’s action also does not require Tribes to develop

[Clean Air Act] programs wholly from scratch. [**26] For example, a Tribe may adopt or incorporate standards from an adjacent

or similarly situated State, with appropriate revisions that would adapt the State standards to reservation conditions or Tribal

policies.′′ Indian Tribes: Air Quality Planning and Management, 59 Fed. Reg. 43,956, at 43,961 (Aug. 25, 1994) (to be codified

at 40 C.F.R. pts. 35, 49, 50, and 81) (emphasis added).

Page 13 of 17

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Ann Lyons
arbitrary and capricious. APS claims the EPA

did not provide a reasoned basis for the 20%

opacity limit, arguing that it did not establish

why it chose that particular limit or how this

20% figure [*1127] ensures compliance with

national air standards. APS claims the EPA did

not, moreover, adequately explain its use of or

basis for the [**28] underlying PM emissions

limit that justifies the opacity limit. 10 APS

acknowledges it originally agreed to a 20%

opacity limit, albeit with an exemption for

periods of malfunction. Nevertheless, APS

claims that, without an allowance for periodic

exceedances, the opacity limit is unattainable

with current control equipment, contrary to

APS’s statistical analysis of the historical COMS

data, and unnecessary to maintain national air

standards.

APS further contends the EPA’s refusal to

exempt excess emissions caused by

malfunctions is inconsistent with its position on

excess emissions during other periods and is not

supported by any analysis showing this policy is

necessary for maintenance of the national air

standards. It notes the EPA altogether failed to

respond to APS’s proposed .2% allowance. APS

adds that the affirmative defense to civil

penalties does not cure the EPA’s error and does

not preclude a finding of violation or the

granting of injunctive relief. Similarly,

[**29] according to APS, the affirmative

defense is not justified by any underlying factual

basis.

We note first that APS may not challenge the PM

limit as arbitrary or capricious. APS did not

contest the rationality of the underlying PM limit

during the comment period and, therefore,

cannot raise the issue on appeal. See Silverton

Snowmobile Club v. U.S. Forest Serv., 433 F.3d

772, 783 (10th Cir. 2006) (refusing to consider

argument because, inter alia, it was not raised

with agency); Excel Corp., 397 F.3d at 1296-97

(deeming arguments waived if record does not

show presentation to agency); N.M. Envtl.

Improvement Div. v. Thomas, 789 F.2d 825, 836

(10th Cir. 1986) (HN24 ′′The court will not

entertain arguments which should have properly

been made before the agency in the first

instance.′′). APS implicitly defends its failure to

challenge the PM limit by noting that it

requested notice of, and the opportunity to

comment on, any rationale the EPA might

ultimately develop for the various emissions

limits. We acknowledge the 2006 proposal did

not state that the opacity limit ensures

compliance with the PM limit. See J.A. at 12, 15.

However, the EPA did provide this justification

in the 1999 proposed [**30] plan and in the

technical document supporting the 1999

proposal. See id. at 3, 54, 153. APS clearly

cannot claim it did not have notice of the EPA’s

basis for the opacity limit. APS knew of the

EPA’s justification since at least 1999 and likely

as early as 1994. 11 Yet APS never challenged the

opacity limit by attacking the rationality of the

underlying PM limit. See id. at 100-01, 171-84,

291-93, 296-300, 304. APS cannot rely on

general or vague commentary now to avoid the

established principles of waiver. See

Appalachian Power Co. v. EPA, 346 U.S. App.

D.C. 211, 251 F.3d 1026, 1036 (D.C. Cir. 2001)

(HN25 ′′Generalized objections to agency action

. . . will not do. An objection must be made with

sufficient specificity reasonably to alert the

agency.′′) (internal quotations omitted). Thus,

APS has waived any challenge to the PM limit.

APS’s remaining arguments lack merit. The

EPA provided a reasoned basis for the 20%

opacity limit. As the EPA [*1128] has

repeatedly [**31] explained, the opacity limit is

necessary to ensure Units 4 and 5 are in

continuous compliance with the PM limit and

10 PM is a criteria pollutant and stands for ′′particulate matter.′′ See supra Part I. PM ′′refers to all ’solid particles and liquid

droplets found in air.’′′ Am. Trucking Assoc., Inc. v. EPA, 350 U.S. App. D.C. 254, 283 F.3d 355, 359 (D.C. Cir. 2002).

11 In a 1994 letter to the EPA, APS stated ′′since there is no quantifiable relationship between opacity and [PM] emissions or

ambient concentrations of [PM], an opacity requirement is not necessary for [national air standards] attainment purposes.′′ J.A. at

100.

Page 14 of 17

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Ann Lyons
are properly operated and maintained. See J.A. at

3, 22. APS must perform annual testing to ensure

direct compliance with the PM limit. 40 C.F.R. §

49.23(e). The opacity limit helps to make certain

that the Units continuously comply with the PM

limit during the periods between annual tests.

The EPA did not need to explain or demonstrate

why it selected 20% as the opacity limit. APS

initially agreed to the 20% figure, fully

understood the EPA’s justification for the limit,

and never suggested that another number was

necessary. Prior to 2006, APS never claimed it

could not achieve the 20% limit, except during

startup, shutdown, malfunction, and saturated

stack conditions. See J.A. at 110, 127, 130,

174-76, 291-93, 297-300. In fact, in 1996, APS

informed the EPA that normal opacity levels

′′typically [were] less than 5 percent.′′ Id. at 115.

Moreover, the opacity limit is not counter to any

evidence in the record. APS did not submit data

or analysis to support its .2% proposal, although

it claimed to have such documentation. APS

waited twelve years before even mentioning the

[**32] matter. 12 APS did not explain then -- and

does not elucidate now -- what actually caused

the exceedances allegedly recorded in the

withheld COMS data. 13 We agree with our sister

circuit that HN26 an agency must respond only

to relevant comments, which ′′cast doubt on the

reasonableness of a position taken by the

agency.′′ National Mining Ass’n v. MSHA., 325

U.S. App. D.C. 176, 116 F.3d 520, 549 (D.C. Cir.

1997) (internal quotation marks omitted); see

Pub. Citizen, Inc. v. FAA, 300 U.S. App. D.C.

238, 988 F.2d 186, 197 (D.C. Cir. 1993) (′′We

reiterate that to require response by the agency,

comments must do more than simply state that

the agency’s premises or conclusions are wrong;

they must explain why and on what basis the

agency assertedly has erred.′′); see also

Kennecott Copper Corp. v. EPA, 612 F.2d 1232,

1236 (10th Cir. 1979) (′′[A]gencies need not

supply comprehensive explanations and record

citations for each and every conclusion. These

rules are to ensure satisfaction of due process

requirements and meaningful public

participation in rulemaking, not to straitjacket

agency proceedings.′′ (citation omitted)).

While we agree the EPA did not address

explicitly APS’s request for a .2% allowance, we

note the EPA did address the substance of APS’s

proposal. Only five logical explanations exist for

periodic exceedances: saturated stack

[**34] conditions, startup, shutdown,

unavoidable malfunctions, and operator error or

neglect. The federal plan addresses each of these

possibilities. [*1129] Regarding saturated stack

conditions, the federal plan provides that ′′[i]f

the [pollution control equipment] is operating

within its normal operating parameters . . . [and]

not fully closed, and a high opacity reading

occurs, it will be presumed that the occurrence

was caused by saturated stack conditions and

shall not be considered a violation.′′ 40 C.F.R. §

49.23(e). Regarding startup and shutdown, ′′the

otherwise applicable emission limits . . . for

opacity and [PM] shall not apply′′ provided that

the Plant (i) operates to minimize emissions and

uses best efforts to meet the otherwise applicable

emission limit, (ii) minimizes to the extent

practicable the frequency and duration of

startups and shutdowns, and (iii) properly

documents startups and shutdowns. Id. §

49.23(h)(2). Regarding unavoidable malfunction

events, the federal plan states that ′′[e]missions

in excess of the level of the applicable emission

12 APS appears to justify this delay by explaining, ′′By the time EPA published the 2006 proposed [federal [**33] plan], APS

noticed that in other contexts, EPA appeared to be willing to deal reasonably with the issue of excess opacity emissions. APS had

also come to recognize that the definition of malfunction would not always be easy to apply.′′ Reply at 23. These justifications

do not suffice. The EPA’s treatment of opacity in separate rulemakings, with completely distinguishable facts and law, has nothing

to do with the reasonableness of the opacity limit at hand. Similarly, APS knew of the malfunction definition since at least

1994, see J.A. at 87, and yet did not seek the additional allowance until 2006.

13 Moreover, we know now that APS was not completely candid in requesting the .2% allowance. APS admits the .2% figure

′′include[s] a margin of safety so that if adopted, [the Plant] could be reasonably certain of full compliance.′′ Aplt. Br. at 19 n.6. APS

has yet to explain the percentage of or basis for the margin of error surreptitiously added to arrive at the .2% figure.

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limit . . . that occur due to a malfunction shall

constitute a violation of the applicable emission

limit.′′ Id. § 49.23(h)(3). APS has an

[**35] affirmative defense to claims for

penalties if it can show, inter alia, that a

malfunction resulted from a sudden and

unavoidable failure of process or equipment. Id.

The plan does not excuse excess emissions

resulting from operator error or neglect. Id. §

49.23(h)(3)(ii). That APS does not agree with the

EPA’s rejection of the substance of its proposed

.2% allowance is irrelevant; as long as the EPA’s

decisionmaking process may reasonably be

discerned, we will not set aside the federal plan

on account of a less-than-ideal explanation.

Alaska Dep’t of Envtl. Conservation, 540 U.S. at

497.

Nor are we persuaded by APS’s disagreement

with the EPA’s rejection of its proposed

malfunction exemption. As the EPA explained

during the rulemaking process, its treatment of

excess emissions resulting from malfunctions is

consistent with longstanding EPA policy set

forth in various memoranda in the record. HN27

The longstanding policy makes clear that excess

emissions resulting from malfunctions are

violations of the Clean Air Act, for such

emissions can interfere with attainment of the

national air standards. See72 Fed. Reg. at

25,702, 25,705; State Implementation Plans:

Policy Regarding Excessive Emissions

[**36] During Malfunctions, Startup, and

Shutdown (Sept. 20, 1999) (hereinafter Herman

Memorandum); Policy on Excess Emissions

During Startup, Shutdown, Maintenance, and

Malfunctions (Feb. 15, 1983) (hereinafter

Bennett Memorandum). The longstanding policy

grants a limited affirmative defense where

interference with national air standards will not

occur and injunctive relief is still available as an

enforcement mechanism.

Contrary to APS’s assertion, HN28 the EPA’s

treatment of malfunction events is not

inconsistent with its treatment of startup and

shutdown episodes. The EPA’s longstanding

policy applies ′′alternate limits′′ to excess

emissions resulting from these infrequent,

reasonably foreseeable episodes, where a

source’s pollution control equipment is

technically incapable of meeting the emissions

limits for a defined period of time. 72 Fed. Reg.

at 25,702; Herman Memorandum at 3, attach. at

4-5; Bennett Memorandum at 17-5. The EPA has

reiterated that bypassing the pollution control

equipment during startup and shutdown episodes

may be necessary to avoid ′′loss of life, personal

injury, or severe property damage.′′ Bennett

Memorandum at 17-5; see Herman

Memorandum at 3 (recognizing that for some

[**37] sources even the best available pollution

control equipment cannot be effective during

every startup and shutdown). We defer to the

EPA’s longstanding policy, for the policy is a

reasonable interpretation of the Clean Air Act.

[*1130] We acknowledge APS is correct that

exemption of the Plant’s excess emissions from

malfunction events logically would not lead to

interference with attainment of the national air

standards. Neither the New Mexico state plan

nor the Plant’s historical operations deem excess

emissions from malfunctions as violations.

APS’s point carries no weight, however. HN29

The EPA’s longstanding policy explicitly states

that a limited affirmative defense to penalties for

malfunctions may be available where

interference with the national air standards will

not occur. Thus, the EPA interprets the Act as

allowing a limited affirmative defense only in

situations where attainment will not be

detrimentally affected, and this is exactly what

the federal plan provides. Moreover, in response

to APS’s argument that the policy justification

lacks a ′′limiting standard against which to

measure [] reasonableness,′′ Reply Br. at 22, we

note HN30 there is no requirement that a

gap-filling federal plan [**38] can be only as

strict as necessary to meet national air standards.

The Clean Air Act and the TAR certainly do not

include such a mandate. States, and presumably

tribes, may surpass national air standards as long

as their plans satisfy all of the minimal Clean Air

Act requirements. See Union Elec. Co., 427 U.S.

at 263-65 (holding that the EPA cannot

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Ann Lyons
disapprove a state plan solely because it imposes

stricter limits than the national air standards or is

economically or technologically infeasible). We

have found no authority saying that we can

prevent the agency to which we owe substantial

deference from implementing the same type of

superior plan.

Finally, we reject APS’s challenge to the

justification for the affirmative defense. APS

argues, without citation to any authority, that the

EPA must justify inclusion of the affirmative

defense with ′′a factual basis for presuming that

excess emissions are the fault of APS, and

requiring APS to prove otherwise.′′ Reply at 28.

We need not address unsupported, conclusory

arguments. See Pignanelli v. Pueblo Sch. Dist.

No. 60, 540 F.3d 1213, 1217 (10th Cir. 2008)

(deeming argument waived for failure to cite any

supporting legal authority or record

[**39] evidence). APS adds that the EPA

offered no defense to this ′′burden-shifting′′

affirmative defense. See Reply at 27-28. We

disagree. The EPA did explain its inclusion of

the affirmative defense:

[E]ach party bears the appropriate

burden in any enforcement case. The

party seeking to enforce a claim bears

that burden of proving that excess

emissions occurred to establish a

violation. [APS] may raise as a

defense to penalties that the violation

was unavoidable and [the Plant] took

appropriate preventive and corrective

action. The court retains its function of

determining whether each party has

met its burden.

72 Fed. Reg. at 25,702. We hold the EPA

has established ′′an adequate rationale′′ for

the affirmative defense. National Tank

Truck v. EPA, 285 U.S. App. D.C. 107, 907

F.2d 177, 184 (D.C. Cir. 1990). This is all

that Chevron requires.

We conclude the EPA has not acted arbitrarily or

capriciously. The EPA identified a regulatory

need and enacted a source-specific federal plan

to fill this gap. The EPA has neither relied on

factors which Congress did not intend it to

consider nor failed to consider any important

aspect of the problem. See Motor Vehicle Mfrs.

Ass’n, 463 U.S. at 43. The EPA addressed all

substantive [**40] aspects of APS’s comments:

startup, shutdown, malfunction, and saturated

stack conditions. The EPA based its decision on

the evidence before it, i.e., current air quality

data for the area surrounding the Plant, and

incorporated its negotiations with APS, the

Navajo Nation, and the State of New Mexico

into its plan. We can ascribe [*1131] APS’s

disagreement with the EPA’s final action to a

difference in view. See id. Accordingly, APS’s

petition is denied.

IV.

For the reasons set forth above, we GRANT the

motion for voluntary remand and VACATE and

REMAND the federal implementation plan

insofar as it pertains to the fugitive dust limit.

We DENY APS’s petition for review, DENY the

Environmentalists’ petition for review, and

AFFIRM the remainder of the federal

implementation plan.

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