Opinion ID: 2465274
Heading Depth: 1
Heading Rank: 5

Heading: Sulfur Dioxide Emissions

Text: [¶ 6] An application for an air quality permit must provide information on the proposed source's Potential to Emit, or PTE, which is defined by regulation as: the maximum capacity of a stationary source to emit a pollutant under its physical and operational design. Any physical or operational limitation on the capacity of the source to emit a pollutant, including air pollution control equipment and restrictions on hours of operations or the type or amount of material combusted, stored, or processed, shall be treated as part of its design if the limitation or the [e]ffect it would have on emissions is enforceable. WAQSR ch. 6, § 4(a). [¶ 7] Based on information provided by Medicine Bow during the permitting process, DEQ determined that the proposed facility's PTE for sulfur dioxide is approximately 37 tons per year. The Sierra Club claims that the facility's PTE should be much larger, arguing that the DEQ improperly excluded from Medicine Bow's PTE emissions that will occur during malfunctions of the facility, and emissions resulting from cold starts. [1] Cold starts are necessary after the facility has been shut down long enough that the equipment has cooled to ambient air temperature. [¶ 8] The facts underlying this issue are not in dispute. Medicine Bow will perform a cold start when the facility first begins operations. Additional cold starts will be necessary to restart operations if the facility is shut down for major maintenance or repairs. Cold starts are estimated to occur once every three or four years. Medicine Bow also acknowledges that malfunctions will occur on occasion. The parties do not dispute the estimated emissions rates associated with cold starts and malfunctions. They disagree over whether, as a matter of law, these emissions must be included in Medicine Bow's PTE. [¶ 9] When it issued the permit, DEQ explained that it has been the agency's consistent practice to make PTE determinations based on consideration of a facility's routine operations. DEQ determined that emissions from malfunctions and cold starts did not result from the facility's routine operations, and so excluded them from Medicine Bow's PTE. This appears consistent with the regulatory definition of PTE. As explained in United States v. Louisiana-Pacific Corp., 682 F.Supp. 1141, 1158 (D.Colo.1988), PTE is meant to represent the maximum emissions that can be generated while operating the source as it is intended to be operated and as it is normally operated. Malfunctions and cold starts do not represent the way the Medicine Bow facility is intended to be operated, or the way it will normally be operated. [¶ 10] Significantly, DEQ drew a distinction between cold starts and warm starts. Warm starts occur after planned regular maintenance activities, and will take place approximately once every 60 days. Because warm starts are planned and relatively frequent, DEQ considered them to be part of the facility's normal operations, and included those emissions in the facility's PTE. Cold starts, in contrast, are unplanned and irregular, and are estimated to occur only once every three to four years. DEQ did not consider cold starts to be part of the facility's normal operations, and excluded those emissions from Medicine Bow's PTE. Medicine Bow agrees with DEQ's position, emphasizing that the exclusion of emissions from cold starts and malfunctions is consistent with DEQ's long-standing interpretation of the PTE regulation. [¶ 11] The Sierra Club's argument that DEQ failed to consider the emissions from cold starts and malfunctions suggests that DEQ ignored these emissions. The record demonstrates otherwise. The permit limits Medicine Bow's sulfur dioxide emissions to the 37 tons per year, the same as its PTE. If emissions from malfunctions and cold starts exceed the limit of 37 tons per year, DEQ and Medicine Bow have recognized that these emissions will be considered excess emissions, and could subject Medicine Bow to enforcement action. See Wyo. Stat. Ann. §§ 35-11-201, -701, -801. As will be discussed in detail below, the permit issued by DEQ included several conditions intended to control and limit emissions from cold starts and malfunctions. As a practical matter, the Sierra Club has not pointed out any way in which emissions from cold starts and malfunctions would be regulated differently if they had been included in Medicine Bow's PTE. [¶ 12] In addition, we note that the emissions from cold starts and malfunctions were included in computer models used to predict the air quality impacts of Medicine Bow's facility. DEQ reported that [r]esults of the modeling were below the 3-hour and 24-hour WAAQS and NAAQS. [2] DEQ's inclusion of sulfur dioxide emissions in modeling is not determinative of whether such emissions must also be included in the facility's PTE. However, DEQ's inclusion of these emissions in the modeling demonstrates that DEQ did not overlook these emissions. [¶ 13] The Sierra Club maintains that there is a mountain of authorities demonstrating that DEQ's interpretation is inconsistent with that of the federal Environmental Protection Agency (EPA). We have previously recognized that Wyoming's air quality regulatory program is intended to be compatible with, and at least as stringent as, the federal Clean Air Act, and accordingly, federal precedent and regulatory guidance is persuasive authority in Wyoming air quality cases. Powder River Basin Resource Council, ¶ 7, 226 P.3d at 813. Having reviewed the federal authorities cited by the Sierra Club, however, we find little support for its position. [¶ 14] The Sierra Club quotes from Louisiana-Pacific, 682 F.Supp. at 1157, for the concept [that] potential to emit refers to the maximum emissions a source can generate when being operated within the constraints of its design. But as we have already discussed, Louisiana-Pacific establishes that PTE includes only emissions that occur during normal operations: Any analysis of the definition of potential to emit must include a reference to the case of Alabama Power Co. v. Costle, 204 U.S.App. D.C. 51, 636 F.2d 323 (D.C.Cir. 1979) because the current definition above was promulgated in response to the D.C. Circuit's holding in that case. . . . The broad holding of Alabama Power is that potential to emit does not refer to the maximum emissions that can be generated by a source hypothesizing the worst conceivable operation. Rather, the concept contemplates the maximum emissions that can be generated while operating the source as it is intended to be operated and as it is normally operated. . . . Alabama Power stands for the proposition that hypothesizing the worst possible emissions from the worst possible operation is the wrong way to calculate potential to emit. Louisiana-Pacific, 682 F.Supp. at 1157-58 (emphasis added). This discussion is more supportive of DEQ's interpretation than the Sierra Club's. [¶ 15] The Sierra Club also relies on various EPA documents, but close reading of these documents reveals that they are distinguishable or, when put in context, do not further the Sierra Club's argument. For example, the Sierra Club quotes from an EPA guidance letter explaining that, to determine PTE, a source must estimate its emissions based on the worst-case scenario taking into account startups, shutdowns and malfunctions. Letter from Steven C. Riva, EPA, to William O'Sullivan, New Jersey Dep't of Environmental Protection, February 14, 2006. On first reading, the quoted sentence would appear to support the Sierra Club's assertion that emissions from malfunctions and cold starts should be included in Medicine Bow's PTE. We note, however, that the letter's indication that PTE is based on a worst-case scenario seems inconsistent with the court's holding in Louisiana-Pacific, 682 F.Supp. at 1158, that PTE does not refer to the maximum emissions that can be generated by a source hypothesizing the worst conceivable operation. Moreover, when the quoted sentence is read in context, it does not support the Sierra Club's position. [¶ 16] In the quoted guidance letter, the EPA was answering a question from the New Jersey Department of Environmental Protection about how to deal with emissions from emergency generators when determining PTE. The answer given was that EPA has no policy that specifically requires exclusion of `emergency' (or malfunction) emissions. Letter from Steven C. Riva, supra. (Emphasis added.) By the same token, the letter did not set forth any policy that specifically requires inclusion of emergency or malfunction emissions in PTE. Rather, the EPA said, to determine PTE, a source must estimate its emissions based on the worst-case scenario taking into account startups, shutdowns and malfunctions. Id. (Emphasis added.) Following this discussion, the EPA advised that New Jersey should continue as they have and permit emergency units at some amount of operation sufficiently large to cover emergencies (i.e. 500 hours a year). Malfunctions that may require the operation of the emergency units and that may exceed the 500 hours/year limit could be handled through enforcement discretion on a case-by-case basis, as appropriate. Id. We read this guidance letter to say that emissions from startups, shutdowns, and malfunctions are not automatically excluded from PTE, nor are they automatically included. They must be taken into account by including them in PTE if they fit within the regulatory definition, or excluding them if they do not. [¶ 17] The Sierra Club's position that emissions from cold starts and malfunctions must be included in PTE is, therefore, inconsistent with the EPA's guidance that such emissions are not automatically included or excluded from PTE. In contrast, DEQ's decision in this case appears in accord with the guidance letter. As noted above, DEQ took into account emissions from cold starts, warm starts, and malfunctions. It determined that emissions from warm starts should be included in PTE, while emissions from cold starts and malfunctions should be excluded. With regard to the emissions excluded from Medicine Bow's PTE, DEQ also noted that excess emissions from cold starts and malfunctions may be handled through enforcement discretion, which is also consistent with the EPA's guidance letter. [¶ 18] We conclude that DEQ's decision to exclude emissions from malfunctions and cold starts from Medicine Bow's PTE was not contrary to applicable Wyoming statutes and regulations. The Sierra Club has not demonstrated that it was inconsistent with federal authority or EPA guidance. The Council did not err in upholding DEQ's decision on Medicine Bow's PTE. [¶ 19] As the second part of its sulfur dioxide issue, the Sierra Club asserts that DEQ did not require Medicine Bow to adopt the Best Available Control Technology (BACT) to control sulfur dioxide emissions from flares during cold starts and malfunctions. As discussed above, DEQ did not include these emissions within Medicine Bow's PTE. Nevertheless, Wyoming regulations provide that these emissions are still subject to BACT requirements. WAQSR ch. 6, § 2(c)(v). BACT is a term of art, and because different portions of the definition become significant in the discussion to follow, we set forth here the entire regulatory definition:  Best available control technology  means an emission limitation (including a visible emission standard) based on the maximum degree of reduction of each pollutant subject to regulation under these Standards and Regulations or regulation under the Federal Clean Air Act, which would be emitted from or which results [from] any proposed major stationary source or major modification which the Administrator, on a case-by-case basis, taking into account energy, environmental, and economic impacts and other costs, determines is achievable for such source or modification through application [of] production processes and available methods, systems, and techniques, including fuel cleaning or treatment or innovative fuel combustion techniques for control of such pollutant. If the Administrator determines that technological or economic limitations on the application of measurement methodology to a particular emissions unit would make the imposition of an emission standard infeasible, he may instead prescribe a design, equipment, work practice or operational standard or combination thereof to satisfy the requirement of Best Available Control Technology. Such standard shall, to the degree possible, set forth the emission reduction achievable by implementation of such design, equipment, work practice, or operation and shall provide for compliance by means which achieve equivalent results. Application of BACT shall not result in emissions in excess of those allowed under Chapter 5, Section 2 or Section 3 of these regulations and any other new source performance standard of national emission standards for hazardous air pollutants promulgated by the EPA but not yet adopted by the State of Wyoming. WAQSR ch. 6, § 4(a). The federal Clean Air Act includes an essentially identical definition of BACT. 42 U.S.C. § 7479(3). In simplified terms, this regulation requires the DEQ to consider a broad range of available pollution control and reduction options, determine which can be achieved reasonably, and impose those as permit requirements. Powder River Basin Resource Council, ¶ 40, 226 P.3d at 821. [¶ 20] The permit issued to Medicine Bow contains several conditions relating to emissions from the flares: 22. [Medicine Bow] shall monitor SO2 emissions from the HP [heavy liquid] and LP [light liquid] flares. Monitoring of SO2 emissions shall consist of installing flow monitoring equipment to the flares, and by either direct sampling of the flow to the flares or sampling of the coal. Records shall be kept for a period of at least 5 years and shall be made available to [DEQ] upon request. 23. That the HP and LP flares shall be designed, constructed, operated and maintained to be smokeless, per Chapter 5, Section 2(m) of the WAQSR, with no visible emissions except for periods not to exceed a total of five (5) minutes during any two (2) consecutive hours as determined by Method 22 of 40 CFR part 60, Appendix A. 24. [Medicine Bow] shall maintain and operate the HP and LP flares during all period[s] of active operation such that the controls remain effective as viable emission control devices. 25. That the presence of a pilot flame shall be monitored using a thermocouple and continuous recording device or any other equivalent device to detect the presence of a flame on the HP and LP flares. [Medicine Bow] shall maintain records noting the date and duration of time during active operation when the pilot flame is not present in the HP and LP flares. Records shall be kept for a period of at least 5 years and shall be made available to [DEQ] upon request. . . . 31. During periods of startup, [Medicine Bow] shall adhere to their procedures in their Startup/Shutdown Emission Minimization Plan, attached as Appendix A. This plan may be modified as deemed necessary by [Medicine Bow] without amending the permit, but revisions to the plan shall be approved by [DEQ] prior to implementation. [3] As DEQ explains, in issuing the permit to Medicine Bow, it considered the available information regarding pollution control and reduction options for flares and, applying its engineering judgment and experience, determined which measures were reasonably available. Such measures were included as permit requirements meant to ensure that flare emissions would be minimized. [¶ 21] The Sierra Club's initial contention is that BACT is an emissions limitation  a numerical limit that a source cannot exceed. This is simply incorrect. BACT need not be expressed as a numerical emissions limit. The regulation, quoted above, explicitly provides that BACT requirements may be satisfied by a design, equipment, work practice or operational standard or combination thereof. WAQSR ch. 6, § 4(a). Corresponding EPA regulations also provide, in nearly identical language, that numerical emissions limitations are not the exclusive means of achieving BACT. 40 C.F.R. §§ 51.166(b)(12); 52.21(b)(12). [¶ 22] The Sierra Club nevertheless contends that a work practice plan like the SSEM plan can be used for BACT only in `limited circumstances' if a well-reasoned determination is made in the record that [a numerical] emission limit is technically infeasible and the plan is equivalent to BACT, citing a decision of the federal Environmental Appeals Board, In re Indeck-Elwood, LLC, PSD Appeal 03-04, 2006 WL 3073109 at  (E.A.B.2006). The Sierra Club's contention that the agency's decision to impose a substitute for numerical emissions limitations must be documented by a well reasoned determination . . . in the record is an accurate paraphrase of Indeck-Elwood, in which the Environmental Appeals Board stated that BACT determinations must be well documented in the administrative record. 2006 WL 3073109 at , n. 97. However, the procedures by which the Environmental Appeals Board reviews permit decisions differ from those by which Wyoming's Environmental Quality Council reviews DEQ decisions. Because of these procedural differences, the Sierra Club's view of how BACT decisions must be documented in the record is not applicable in Wyoming. [¶ 23] When the EPA reviews an application for an air quality permit, the agency must compile a record, as set forth in 40 C.F.R. § 124.9. The decision to issue or deny a permit is made by the Regional Administrator, and is based on the record compiled by the agency. 40 C.F.R. § 124.18. The Regional Administrator's decision may be appealed to the Environmental Appeals Board, which also bases its decision on the compiled record, and does not take new evidence from the parties. 40 C.F.R. § 124.19. See generally, Environmental Appeals Board website, available at www.epa.gov/eab. [¶ 24] Wyoming has an EPA-approved air quality regulatory program. 40 C.F.R. part 52, subpart ZZ. DEQ, rather than the EPA, issues air quality permits in Wyoming. See Wyo. Stat. Ann. § 35-11-801, 42 U.S.C. § 7410(a). DEQ's permit decisions are reviewed by the Wyoming Environmental Quality Council. Wyo. Stat. Ann. §§ 35-11-112, -208, -802. Unlike the federal Environmental Appeals Board, the Council is not limited to reviewing the record compiled by DEQ prior to issuing a permit. Instead, the Council conducts a contested case hearing at which all parties are afforded the opportunity to present new evidence. See generally, DEQ Rules of Practice and Procedure Applicable to Hearings in Contested Cases, Chapter II; Wyo. Stat. Ann. § 16-3-107(j) (In a contested case hearing, [o]pportunity shall be afforded all parties to respond and present evidence and argument on all issues involved.). Accordingly, the Council is allowed, even obligated, to consider new evidence presented to it on review. [¶ 25] When the Council considered the parties' cross-motions for summary judgment, it was not limited to considering only the record previously compiled by the DEQ. As the Council correctly recited in its order granting summary judgment to DEQ and Medicine Bow, pursuant to W.R.C.P. 56(c), it was required to consider the pleadings, depositions, affidavits, and other supporting material presented by the parties in conjunction with their cross-motions for summary judgment, and to grant summary judgment if there were no genuine issues of material fact and the moving party was entitled to judgment as a matter of law. The Council's conclusions of law also included this accurate explanation: 8. On a summary judgment motion, the movant has the burden of establishing a prima facie case based on admissible evidence. The burden then shifts to the opposing party to establish through specific facts that a material question of fact remains. Cornelius v. Powder River Energy, 2007 WY 30, ¶ 10, 152 P.3d 387, 390 (Wyo.2007). 9. The evidence opposing a prima facie case on a motion for summary judgment must be competent and admissible, lest the rule permitting summary judgments be entirely eviscerated by plaintiffs proceeding to trial on the basis of mere conjecture or wishful speculation. Speculation, conjecture, the suggestion of a possibility, guesses, or even probability, are insufficient to establish an issue of material fact. Jones v. Schabron, 2005 WY 65, ¶ 11, 113 P.3d 34, 38 ([Wyo.] 2005). [¶ 26] Our review of the record reveals that DEQ and Medicine Bow provided sufficient evidence to the Council to establish a prima facie case on the question of whether DEQ's substitution of Medicine Bow's SSEM Plan was justified because of the infeasibility of measuring emissions from the flares. In its decision document, DEQ's response to comments from the public explained that DEQ did not establish emissions limits for the flares as emission limits would not be practically enforceable as these units cannot be tested using traditional EPA reference methods to determine compliance with emission limits. This information was presented to the Council as an exhibit to DEQ's motion for summary judgment. Medicine Bow provided additional support for the technical infeasibility of measuring emissions from the flares in the form of an affidavit from its expert witness confirming that numerical emissions limits for the flares could not be verified because there was no measurement methodology. This evidence was adequate to make the prima facie showing that, in the words of the regulation, technological or economic limitations on the application of measurement methodology rendered the imposition of a numeric emission standard infeasible. WAQSR ch. 6, § 4(a). [¶ 27] At this point, the burden shifted to the Sierra Club to establish through specific facts that a material question of fact remained to be answered. Cornelius, ¶ 10, 152 P.3d at 390. Because the Sierra Club was the party opposing summary judgment, the Council was required to view the evidence from the vantage point most favorable to the Sierra Club, and give the Sierra Club the benefit of all favorable inferences that could fairly be drawn from the evidence. On judicial review, we afford the Sierra Club the same favorable view of its evidence and the same benefit of fairly drawn favorable inferences. Loya v. Wyoming Partners of Jackson Hole, Inc., 2001 WY 124, ¶ 8, 35 P.3d 1246, 1251 (Wyo.2001). [¶ 28] The Sierra Club offered no such evidence, either in support of its own motion for summary judgment, or in response to the motions of DEQ and Medicine Bow. Rather than offering any evidence to refute that offered by DEQ and Medicine Bow, the Sierra Club insisted before the Council, as it continues to argue before this Court, that the evidence presented by DEQ and Medicine Bow was not in the record compiled by DEQ before issuing the permit. It characterized the report attached to the affidavit of Medicine Bow's expert as little more than classic post-hoc rationalization offered in an attempt to clean up after the lack of analysis done by DEQ. [¶ 29] As discussed above, however, the Council was not limited to considering only the record compiled by DEQ prior to issuing the permit. The Council did not err in considering the evidence offered by DEQ and Medicine Bow. Through that evidence, DEQ and Medicine Bow established their prima facie cases that there were no genuine issues of material fact regarding the infeasibility of measuring emissions from the flares. The Sierra Club presented no evidence to dispute the evidence offered by DEQ and Medicine Bow, and accordingly, it failed to establish that any genuine issue of material fact remained to be decided. [¶ 30] The Sierra Club's final contention with regard to the flares is that a work practices plan is acceptable as BACT only if it is demonstrated to be the equivalent of BACT, and that there was no determination in the record compiled by DEQ prior to issuing the permit that the SSEM Plan was equivalent to BACT. As previously discussed, the Council was not limited to the record compiled by DEQ prior to issuing the permit. Our review of the record on appeal indicates that DEQ supported its motion for summary judgment with factual evidence that it had reviewed the SSEM Plan using its engineering judgment and experience to ensure that flare emissions were minimized, and the result was a determination, supported by evidence, that the SSEM Plan was equivalent to BACT. Medicine Bow supported its motion for summary judgment with expert opinion that no feasible add-on emissions controls exist for flares, and that a work practices plan such as the SSEM Plan can result in dramatic emission reductions and pollution prevention. Upon this showing by DEQ and Medicine Bow, the burden shifted to the Sierra Club to present evidence raising a genuine issue of material fact. It provided one paragraph in the affidavit of its expert, who quoted selectively from the SSEM Plan but ignored other permitting conditions for the flares. His opinion that the SSEM Plan was not equivalent to BACT was unsupported by any specific facts. Even viewing this evidence in the light most favorable to the Sierra Club, it is speculative, unsupported, and insufficient to counter the showings by DEQ and Medicine Bow. [¶ 31] Considering all of the Sierra Club's sulfur dioxide claims, we conclude that the Council did not err in ruling against the Sierra Club and upholding DEQ's decision to grant Medicine Bow's air quality permit.