Opinion ID: 362872
Heading Depth: 1
Heading Rank: 6

Heading: the agency's exercise of discretion

Text: 128 Petitioners' remaining challenges to the effluent limitations involve attacks solely on the rationality of the Agency's discretionary decisionmaking in various areas. Although we have examined all of petitioners' attacks on the Agency's exercise of discretion and found them wanting, several of them deserve further discussion. Those challenges fall into two major categories: whether EPA has responded adequately to the diversity of the industry in its subcategorization and limit-setting decisions, and whether it has identified practicable technology capable of achieving those limitations.
129 In setting effluent limitations, EPA had to take into account the great diversity among the almost 300 mills subject to Phase II regulation. It did so by two methods: subdivision and averaging. EPA began by subcategorizing the industry on the basis of the major differences in industrial processes and other factors. Further distinctions were made within many subcategories. Industry commented on the earlier subdivision proposals, and EPA accommodated many of industry's concerns, eventually identifying 16 subcategories, divided into 66 subdivisions. On average, that is, EPA tailored one set of limitations to every five mills. This extensive subdivision safeguarded against overzealous standards, increased the confidence that can be placed in the practicability of the regulations, and diminished the need to handle variation through the variance process. 130 Of course, differences still exist among mills within the same subcategories and subdivisions. EPA took these differences into account by basing its limitations on BPCTCA, I. e., the pollution control achieved at the Average of the best mills. For its averages, EPA drew on the best available data base. 70 That the limitations still impose greater burdens on some mills than others, I. e., on those with below average treatment facilities, is an unavoidable consequence of Congress' goal of uniformity in effluent limitations rather than in treatment expenditures. 131 Petitioners' specific challenges to EPA's treatment of variability focus on four sources of variability: cold climate, 71 the profitability of SSL recovery, upset conditions, and hydraulic flow. At the outset, we note that petitioners have a heavy burden in challenging EPA's treatment of variability. That treatment involves a host of administrative, technical, and statistical considerations as to which we lack the mandate to second-guess the Agency. For the reasons discussed below, we uphold EPA's limitations against all four challenges.
132 Petitioners argue that EPA inadequately accounted for temperature differences in setting effluent limitations. As all parties agree, cold climates affect biological waste treatment. Bacteria break waste down more slowly at low temperatures, and different populations of bacteria predominate at different temperatures, 72 so that mills in cold regions have greater difficulty in using biological treatment. See Tanners' Council v. Train, 540 F.2d 1188, 1194 (4th Cir. 1976); American Meat Inst., supra, 526 F.2d at 455. 133 EPA considered the climate problem and concluded that northern paper mills could practicably use activated sludge systems as their method of biological treatment. Under this method, waste is treated before it can cool significantly even in cold climates. 73 Although petitioners counter that activated sludge has many drawbacks, including a susceptibility to shocks and higher cost, 74 EPA took those drawbacks into account in its deliberations. Thus, it included equalization basins in activated sludge BPCTCA to insulate against shocks and, more importantly, it determined that the effluent benefits were worth the extra cost. In light of this latter determination, subcategorization on the basis of climate would be a fruitless act, since the subcategory incurring the higher cost (mills in colder areas) could justifiably be held to the same effluent limitations as the one incurring the lower cost (those in warmer climes). Nor is disapproval of the regulations mandated by prior cases that have discussed temperature subcategorization. The critical issue in those cases has been whether EPA compiled a full record on which it based its decision, and here we find adequate record support for EPA's determination. 75 2. 134 Petitioners next contend that EPA acted arbitrarily in refusing to create a separate subcategory for sulfite mills lacking a profitable process for SSL recovery. As previously noted, the cooking of wood with chemicals in the sulfite process leaves behind a waste-laden solution called spent sulfite liquor (SSL). See pp. ---- - ---- of 191 U.S.App.D.C., pp. 1022-1024 of 590 F.2d Supra. SSL can be recovered by collecting, evaporating, and/or burning it. When sodium and magnesium are used in the cooking solution, SSL recovery is profitable because those expensive chemicals may be economically recovered for reuse rather than discharged. When two less expensive chemicals, ammonia and calcium, are used, SSL recovery is less profitable or unprofitable, and SSL recovery is simply useful as a waste treatment method for disposing of SSL without water pollution. See note 10 Supra. Petitioners assert that the difference between mills at which SSL is profitable, and those at which it is not, is a more basic process difference than some other such differences that Were used as the basis for EPA subcategorization. As such, they assert, the Agency acted arbitrarily in refusing to establish separate subcategories in this instance. 135 We believe that EPA acted within its broad discretion in regulating all sulfite mills without regard to the profitability of SSL recovery. Process is only one of several factors relevant to subcategorization. Other factors may be influential or decisive. Here, subcategorization would have had a negative effect on the cost and effluent benefit balance, because, then, SSL recovery a highly cost-efficient pollution-control technique could have been foregone. 76 By contrast, the other process differences pointed to by petitioners as less drastic but nonetheless the basis for EPA subcategorization do not require that techniques as cost-efficient as SSL recovery be abandoned as BPCTCA. 77 3. 136 Waste treatment facilities occasionally release excess pollutants due to such unusual events as plant start-up and shut-down, equipment failures, human mistakes, and natural disasters. EPA accounted for this type of performance variability by using a careful statistical approach. In setting daily and monthly effluent limitations based on performance data from many plants, it made allowance for more than 99% Of all the variability in performance. Petitioners contend that this degree of accuracy is insufficient in that the statute's civil and criminal penalties are based on an absolute liability standard. They note that the 99% Figure shows that, in the past, fully adequate mill treatment systems have occasionally exceeded the proposed effluent limitations, and they ask the Agency to promulgate an excursion or upset regulation specifying circumstances in which exceeding the limitations will be excused. 137 The excursion issue has troubled EPA and the courts. 78 On the one hand, denying such provisions seemingly asks plants to do the impossible to handle the most unusual upsets in plant conditions. On the other hand, there are strong policy reasons for denying such provisions and leaving the handling of upsets to EPA's enforcement discretion. Last year, EPA reviewed and elaborated its position on the matter. NPDES Decision of the General Counsel No. 57 (March 16, 1977). Henceforth, EPA will identify upset conditions and allow excursion provisions in some industries. In other industries, it will not promulgate such provisions. Instead, it will take variability into account by setting generous daily and monthly effluent limitations and by exercising its discretion not to enforce when appropriate. The proceeding involved in the present case was one of the latter kind. EPA refused to promulgate an excursion provision, stating that it expects that the performance of the worst cases (I. e., plants that exceed limitations) will be improved by proper controls and that the effluent limitations can be achieved by properly operated and maintained plants. 42 Fed.Reg. 1420 (1977) (final regulations). 138 We believe that EPA's position in Decision No. 57 is sound, and we uphold its denial of excursion provisions in this case. A contrary decision might hamper the Agency's ability to force technology and hence could impede enforcement. Congress intended effluent limitations to compel plants to improve their performance, even when innovation was required. See pp. ---- - ---- of 191 U.S.App.D.C., pp. 1061-1062 of 590 F.2d Infra. In this technology forcing context, denial of an excursion provision justifiably compels plants to develop monitoring, repair, and back-up capabilities to avoid excessive discharges. 79 139 Moreover, depriving EPA of discretion to refuse excursions would interfere with the congressional goal of swift and direct enforcement. 80 Excursion provisions cannot be framed in simple numerical terms, as, say, an allowance of four excessive discharges per year, without giving mills a license to dump wastes at will on several occasions annually. American Petroleum Inst. v. EPA, 540 F.2d 1023, 1036 (10th Cir. 1976) (denying excursions). Thus, such provisions must be stated in complex terms, E. g., by specifying plant incidents justifying excessive discharges. 81 140 As the Supreme Court has recognized recently, however, there is a major difference in pollution regulation enforcement between simple numerical standards and complex requirements. 82 Once excursion provisions are promulgated, an enforcement case no longer turns on the sharply defined issue of whether the plant discharged more pollutant than it was allowed to, but instead depends on murky determinations concerning the sequence of events in the plant, whether those events would have been avoidable if other equipment had been installed, and whether the discharge was within the intent of the excursion provision. Consequently, what Congress planned as a simple proceeding suitable for summary judgments would become a form of inquest into the nature of system malfunction. 141 We consequently reject the argument that EPA must promulgate excursion provisions so that the effluent limitations will reflect BPCTCA technology that is effective 100 percent of the time. But see Marathon Oil Co., supra, 564 F.2d at 1273-74. In the nature of things, no general limit, individual permit, or even any upset provision can anticipate all upset situations. After a certain point, the transgression of regulatory limits caused by uncontrollable acts of third parties, such as strikes, sabotage, operator intoxication or insanity, and a variety of other eventualities, must be a matter for the administrative exercise of case-by-case enforcement discretion, not for specification in advance by regulation. See CPC Int'l, Inc., supra, 540 F.2d at 1338 (denying excursions). A line must be drawn as to what is treated in the general rule and what is handled case-by-case, and we believe it appropriate to defer when EPA, in the interest of preserving an enforcement system based on straightforward numbers, establishes a general rule with better than 99 percent accuracy and leaves the rest to prosecutorial discretion. 142 We are likewise unpersuaded by an analogy to excursions under the Clean Air Act, 83 and by the threat of citizen suits, 84 and/or of a lack of good faith on the part of government prosecutors. Accordingly, we uphold EPA's decision to deny excursion provisions. 85 4. 143 The Agency typically expresses its effluent limitations in terms of pounds of pollutants per ton of goods produced. That figure, in turn, is arrived at by multiplying water flow times pollution concentration that is to say, by deriving the product of (1) the gallons of water used per ton of goods and (2) the pounds of pollutant per gallon of water: 144 This approach is designed with the commendable purpose of avoiding limitations expressed in terms, such as pounds of pollution per gallon of water, that would allow mills to avoid the regulatory impact by diluting their effluent. See Marathon Oil Co., supra, 564 F.2d at 1269. Nonetheless, it places the Agency partially in the position of regulating water flow, which tends to vary from mill to mill. That is, in promulgating its limitations, the Agency first reached a conclusion about the normal flow in given segments of the industry and then directed its technology search at finding means to extract the likely pollution from that amount of water. It is true that if a mill has a higher than average flow, it will probably have a lower than average concentration of pollutants. Nonetheless, to treat that higher amount of water, despite its lower concentration of pollutants, might take more facilities or more time, and hence might cost more. As such, those mills that utilize higher levels of flows than those deemed normal by EPA may be at some disadvantage in achieving the effluent limitations. 145 It is important to note, however, that EPA does not Require operators to achieve any specific level of flow, but only that the pollution content in that flow as a whole be below a constant level set relative to tons of product. Hence, EPA does leave industry the option of utilizing a somewhat higher flow but building pollution control technology capable of accommodating it. In light of the nonmandatory nature of the flow determinations made by EPA, we may easily dispose of one of petitioners' contentions. The industry appears to argue that by setting limitations and identifying practicable technology with a given flow in mind, EPA has failed adequately to identify the cost of the required pollution control (or, stated differently, to identify practicable technology) for those plants with higher than average flows. 86 The simple answer to this argument is that EPA studied mills with varying levels of flow and set limitations that it deemed within reach of all of those mills, so long as they installed practicable (I. e., in part, not overly costly) technology. Having found none of the limitations themselves or the practicable technology determinations unreasonable, therefore, the fact that some mills use flows different from those considered normal for the purposes of some of EPA's calculations seems irrelevant. 146 Petitioners further claim, however, that even if reasonable under the normal analysis, the limitations are unsatisfactory because they force any plant with higher than average flows to add Internal controls to reduce water usage. In support of their position, petitioners point to the legislative history suggesting that Congress expected most pollution controls to require end-of-pipe, or external, technology, and they repeat the well established rule derived therefrom that internal controls that are not in common use in the regulated industry may not be required by EPA in the 1977 standards. See American Paper Inst., supra, 177 U.S.App.D.C. at 194, 543 F.2d at 341 (citing cases); American Iron & Steel Inst., supra, 526 F.2d at 1060-61. Although this rule requires the Agency to make a common use, rather than practicability finding whenever the control technology it identifies is internal, we review its decision for abuse of discretion exactly as we review its other findings. 147 In this instance, as in most others, EPA has fully explained its methodology so that the bases for its decision on average flow for each subcategory are visible. App. 2073-177, 2478-81 (Development Document). The Agency achieved this series of figures by a careful process. Initially many of its subcategorization divisions were based on characteristic flows within segments of the industry, so that the mills to be compared with each other were fairly uniform to begin with. Next, the Agency measured the average flow within each subcategory discarding unusually high and, more often unusually low ones. Notably, the Agency based its decision on the average of All mills rather than on the average of the best, which is its usual and unchallenged method of determining practicability. Hence, EPA made a conscious effort to distinguish internal flow controls, which require a common usage finding, from other technological requirements, which may be less industrially prevalent so long as they are practicable. 148 Moreover, beyond these measurements, the Agency also undertook a detailed study of flow control methods and the cost thereof for each subcategory and found them available and used to one degree or another in all subcategories. App. 2195-242, 2364-97 (Development Document). In fact, it showed, as in American Paper Inst., supra, 177 U.S.App.D.C. 194, 543 F.2d at 341, that some of all internal pollution control measures identified as useful by the Agency are used by no less than 75% Of the mills studied within any given subcategory. App. 2214 (Development Document). And, although not all of these controls are aimed at reducing flow, the Agency determined that, overall, more than 50% Of all of the mills studied achieved the subcategory flow rate utilized by EPA in setting the limits, which we find sufficiently indicative of the normality of internal flow controls. 87 Accordingly, the Agency's determination of common flow is within the authorized bounds of discretion.

149 Some of the petitioners have strongly challenged EPA's choice of BPCTCA for the dissolving sulfite subcategory. As discussed above, the intense cooking process used in the dissolved sulfite process dissolves most of the wood's cellulose in waste solutions. See pp. ---- - ---- of 191 U.S.App.D.C., pp. 1022-1024 of 590 F.2d Supra. During biological treatment this dissolved matter is taken up by bacteria. Disposing of the watery mass of these bacteria, I. e., sludge, is a serious problem, for their tough cell walls make it difficult to drain the water from, I. e., dewater, them. Moreover, without draining, sludge is difficult to incinerate or use as landfill. 88 150 It has long been recognized that the dewatering problem is difficult and that all the available approaches have certain drawbacks. See App. 1515-30 (1969 study). EPA began its consideration of the problem in 1973 with a state of the art review of treatment technology, which devoted much attention to alternative dewatering approaches. App. 3693-711. It has since amassed considerable other material on the problem, including the industry's own data and criticism of EPA's dewatering proposals, culminating in discussions in its final Development Document of dewatering technology and the estimated cost and environmental impact thereof. App. 2262-64, 2346-59, 2382-83, 2406-08. 151 Recognizing the difficulty of the problem, EPA has not promoted a single dewatering technology, but instead has offered diverse approaches some sequential, some alternative indicating that each particular dissolving sulfite mill might choose a different approach. In its model, the bacterial solution is chemically prethickened and then mixed with nonbacterial waste, which is easier to dewater and further thickens the mass. The resulting mixture is chemically conditioned and subjected to vacuum filtration, a process in which rotating filters suck a soggy cake out of the prethickened waste. This cake, which may still be 20% Or less solid, can be used for landfill, either at this point or later after pressing to remove even more water. Alternatively, the sludge can be dried using special boilers, and then burned in those same boilers, with the heat of incineration used to dry more sludge. 152 Industry pointed out problems and drawbacks with all these proposed steps and alternatives. 89 The Agency responded by pointing to its record support, including the fact that one out of the six dissolving sulfite mills covered by the regulations has already implemented dewatering technology. 90 Although perhaps a closer question than the others reviewed herein, we do not find EPA's choice of BPCTCA in this instance to be an abuse of its broad discretion. EPA has clearly devoted much attention to the problem and has explained its conclusions. In major part it seems to have been motivated by a congressionally mandated policy concern: the determination to push pollution control technology rapidly and decisively forward to the limits of practicability after 1977 and to the limits of achievability after 1983. See Legislative History, at 1460 (Senate Report) (Administrator given 1977 mandate to press technology and economics to achieve those levels of effluent reduction which he believes to be practicable . . ..). Indeed, even in the earlier set of regulations, Congress expected EPA to press sometimes beyond the most advanced technology currently being used: In those industrial categories where present practices are uniformly inadequate, Congress has admonished the Administrator to interpret  'best practicable' to require higher levels of control than any currently in place if he determines that the technology to achieve those higher levels can be practically applied. Id. at 169-70 (statement of Sen. Muskie). 153 To force industry implementation of pollution control technology, EPA has used a number of approaches upheld by the courts. EPA has based its 1977 standards on exemplary facilities, including foreign ones, American Frozen Food Inst., supra, 176 U.S.App.D.C. at 138, 539 F.2d at 140, and has utilized transfer technology. See note 70 Supra. In this case, EPA has used yet another approach specification of a diverse technological array as BPCTCA 91 which we uphold in light of the lack of effluent treatment that has traditionally characterized sulfite mills. Under this diversified approach, the Agency has identified a number of Alternative dewatering techniques with the expectation that, if several techniques are available, one or another will work at all of the regulated mills. Even if each technique has some drawbacks, together all of them constitute a practicable technology suitable to BPCTCA. In sum, because we find that the dewatering methods identified by EPA have had some success in the past and because the judgment as to whether an array of diverse approaches is sufficient in this instance is best left in the hands of the Agency, Tanners' Council, supra, 540 F.2d at 1192, we accept the Agency's conclusions.
154 Petitioners also make a broad challenge to all the TSS limitations for the industry. They contend that there are certain non-settleable solids that will not be removed by BPCTCA, and the EPA failed to rely on actual treatment performance data in setting TSS limitations that require removing those solids. We considered and rejected a similar challenge in American Paper Inst., supra, 177 U.S.App.D.C. at 198, 543 F.2d at 345, and we are inclined to do likewise here. Petitioners admit that in the particular subcategory it chose as an example, the bleached kraft subcategory, 10 out of the 32 mills already meet all of EPA's effluent limitations, and even more meet just the TSS limitations. Nonetheless, they complain that these conforming mills, as well as others relied on by EPA, utilize advanced internal and external control technologies that were installed solely to meet stringent state and local water quality standards for particular receiving waters. App. 764. This observation is largely correct but it does not present a cognizable grievance. The mills on which EPA has modeled BPCTCA are without question capable of meeting EPA's effluent limitations, and the Agency accordingly is justified in insisting that all other mills come up to this undoubtedly practicable standard. 155 For all of the foregoing reasons, the 1977 effluent limitations for the bleached segment of the American paper industry are upheld, and the petitions denied, except that the BOD limitation for acetate grade dissolving sulfite mills is remanded to the Agency for further proceedings consistent herewith. 156 It is so ordered.