Opinion ID: 4020089
Heading Depth: 1
Heading Rank: 4

Heading: environmental petitioners’

Text: CHALLENGES
As explained at supra §§ I.B.1 and III.F, the EPA used carbon monoxide (CO) as a surrogate for several nondioxin/furan organic HAPs when the Agency set the MACT floors for major boilers. In support of this approach, the EPA found that both CO and these HAPs were the products of “incomplete combustion.” 2010 Proposed Major Boilers Rule, 75 Fed. Reg. at 32,018. The Agency concluded as a result that CO was a reasonable surrogate because: (1) minimizing CO emissions would minimize these HAPs; (2) methods used for the control of these HAP emissions would be the same methods used to control CO emissions (i.e., good combustion or using an oxidation catalyst); (3) standards limiting CO emissions would result in decreases in these HAP emissions; and (4) establishing emission limits for individual organic HAPs would be impractical and costly. Id. Although several commenters challenged aspects of this reasoning, the EPA ultimately stuck with its decision to use CO as a surrogate for non-dioxin/furan organic HAP emissions, without further explanation, in the final Major Boilers Rule. See 2013 Major Boilers Rule, 78 Fed. Reg. at 7,145 (explaining the EPA was denying Sierra Club’s petition to reconsider the suitability of CO as a surrogate for nonorganic HAPs based on the reasoning provided by the Agency in the 2010 proposed rule). changed its position, the fact that the EPA may have acted outside its authority in a rule is not at issue here. “[P]revious statutory violations,” of course, “cannot excuse” new ones. New Jersey v. EPA, 517 F.3d 574, 583 (D.C. Cir. 2008). 77 The Environmental Petitioners challenge this decision, arguing that the EPA has not adequately explained how setting emission standards for CO will accomplish what the statute plainly requires: that the EPA set emission standards for organic HAPs at the average level achieved by the best performers with regard to those HAPs. We agree and remand to the EPA to adequately explain how CO acts as a reasonable surrogate for non-dioxin/furan organic HAPs. We do not, however, vacate the current emission standards because we conclude that the Agency will likely be able to adequately explain its decision on remand and that vacatur would prove substantially disruptive. The EPA may use a surrogate to regulate HAPs under section 7412 where “reasonable.” See, e.g., Nat’l Lime Ass’n, 233 F.3d at 637. To be reasonable, the emission standard set for the surrogate must reflect what the best source or best 12 per cent of sources in the relevant subcategory achieved with regard to the HAP. See Sierra Club I, 353 F.3d at 984. This requires the surrogate’s emissions to share a close relationship with the emissions of the HAP. Id. One crucial factor we have identified for determining whether that close relationship exists is the availability of alternative control technologies. See id. at 985. These technologies regulate the HAP without impacting a surrogate’s emissions, or regulate the surrogate without impacting the HAP. Id. As we have explained, the importance of this factor to our reasonableness analysis “is clear: if EPA looks only to [the surrogate], but HAPs are reduced [in another] way that does not reduce [the surrogate], the best achieving sources, and what they can achieve with respect to HAPs, might not be properly identified.” Id. In the Major Boilers Rule, the EPA proposed using CO as a surrogate because, as relevant here: (1) the lowest possible 78 CO emissions resulted in the lowest possible HAP emissions, and (2) the same combustion and oxidation control methods reduce both types of emissions. See 2010 Proposed Major Boilers Rule, 75 Fed. Reg. at 32,018. But, during notice and comment, the EPA failed to directly consider and respond to several comments that introduced evidence suggesting that other control technologies and methods could be effectively used to reduce HAP emissions without also impacting CO emissions, or vice versa. See, e.g., Inst. of Clean Air Cos., Comments on National Emission Standards for Hazardous Air Pollutants for Major Sources, EPA-HQ-OAR-2002-0058 (Aug. 23, 2010), at 20-21 (No. 11-1108 J.A. 822-23); Responses to Public Comments on EPA’s National Emission Standards for Hazardous Air Pollutants for Major Sources, vol. 2, EPA-HQ-OAR-2002-0058 (Feb. 2011) (No. 11-1108 J.A. 1033, 1035-36, 1049-52). The EPA ultimately decided to use CO as a surrogate for all non-dioxin/furan organic HAPs in its final rule without ever addressing whether such alternative control technologies and methods might be used to lower organic HAP emissions further. See 2011 Major Boilers Rule, 76 Fed. Reg. at 15,654; 2013 Major Boilers Rule, 78 Fed. Reg. at 7,138. Instead, the Agency responded by doubling down on its assertion that both CO and organic HAP emissions were the product of poor combustion and, as a result, optimal combustion would minimize the emissions of both CO and non-dioxin/furan organic HAPs. 2013 Major Boilers Rule, 78 Fed. Reg. at 7,145. But this response was no response at all to the substantial concerns raised in the comments that other variables might also affect emissions. Although we afford an agency’s scientific decision “an extreme degree of deference,” see Kennecott Greens, 476 F.3d at 954-55 (quoting Hüls Am., Inc. v. Browner, 83 F.3d 445, 452 (D.C. Cir. 1996)), we cannot uphold an agency 79 decision that does not consider all relevant factors or fails to establish a reasonable connection to the facts in the record. Cf. Ethyl Corp. v. EPA, 51 F.3d 1053, 1064 (D.C. Cir. 1995). The EPA could not conclude that CO acts as a reasonable surrogate in this statutory context without at least considering a key factor: whether the best performing boilers might be using alternative control technologies and methods that reduce organic HAP emissions beyond what they achieve by regulating CO alone. See Sierra Club I, 353 F.3d at 985. We therefore reject the EPA’s contention that its reason for using CO as a surrogate—that good combustion would minimize both CO and non-dioxin/furan organic HAP emissions—was alone sufficient to support its decision. We recognize that there might be a context where a surrogate’s use is reasonable despite the presence of alternative control methods or technologies, but the Agency does not explain why it did not need to even consider whether such methods might further reduce HAPs here. For example, if the EPA used a surrogate that was closely correlated to the HAP and set surrogacy emission standards at a level that would eliminate HAP emissions altogether, the Agency might not need to account for alternative control technologies in its final rule. In that case, the use of the surrogate would not call into question whether the Agency had regulated the HAP as required by the statute because, after all, nothing is better than eliminating HAP emissions entirely. But the Agency offers us no analogous explanation or supportive data here. Although it is possible that all of the challenged CO emission standards are in fact set at such a level, the Agency has not defended the rule on such reasoning. Indeed, the Agency failed to consider or even comment directly on this issue, including whether certain post-combustion processes might increase organic HAP emissions without a corresponding 80 increase in CO emissions. We cannot ignore such an oversight in this context. We reject, however, the Environmental Petitioners’ other argument that combustion-related issues preclude the EPA from using CO as a surrogate for non-dioxin/furan organic HAPs. The Petitioners contend that the EPA’s decision to use CO was arbitrary because record evidence demonstrated a breakdown in the correlation between CO and organic HAP emissions at CO emission levels below 130 parts per million (ppm). But the EPA explained that this apparent breakdown was most likely caused by the difficulty of measuring the regulated HAP at such extremely low emission levels, rather than by a flaw in the correlation between CO and organic HAPs. 2013 Major Boilers Rule, 78 Fed. Reg. at 7,144-45; Memorandum from Eastern Research Group, Inc. to Jim Eddinger, EPA, Revised MACT Floor Analysis for the Industrial, Commerical, and Institutional Boilers and Process Heaters National Emission Standards for Hazardous Air Pollutants—Major Source (2012 MACT Floor Memorandum) (Aug. 2012), at 11-12 (No. 11-1108 J.A. 1462-63). This is precisely the sort of scientific judgment to which we must defer and accordingly, we do so on this point. See Kennecott Greens, 476 F.3d at 954-55. The Environmental Petitioners fail to provide any reason to believe that organic HAP emissions can, in fact, be accurately measured at such low levels. And the Agency’s explanation also addresses why the EPA discounted record evidence regarding extremely high burn temperatures that demonstrated a potential breakdown in the CO and organic HAP relationship as HAP emissions approached zero. Still, the EPA’s failure to address substantial record evidence on the potential availability of alternative control 81 technologies or methods rendered the Agency’s use of CO as a surrogate for certain organic HAPs arbitrary and capricious. We thus remand the portion of the Major Boilers Rule providing for CO’s use as a surrogate for non-dioxin/furan organic HAPs to the Agency for further consideration. We do not, however, vacate the current emission standards based on CO’s use as a surrogate. We may remand without vacatur where there is a likelihood of (1) cure on remand, and (2) a substantial disruptive effect that would result from vacatur. See Heartland Reg’l Med. Ctr. v. Sebelius, 566 F.3d 193, 19798 (D.C. Cir. 2009). Here, vacatur would cause substantial disruptive effects by removing emission limits for the regulated HAPs. And it is likely that the EPA will be able to adequately explain its use of CO on remand after properly considering the matter. As a result, we decline to vacate the current standards in the interim.
In the Major Boilers Rule, the EPA created subcategories based primarily on the fuel combusted. See 2013 Major Boilers Rule, 78 Fed. Reg. at 7,142. To qualify for certain subcategories, the EPA required that a source burn a fuel mixture comprised of only 10 per cent of the subcategorydefining fuel. See, e.g., id. at 7,193 (“Unit designed to burn solid fuel subcategory means any boiler . . . that burns . . . at least 10 percent solid fuel . . . in combination with liquid fuels or gaseous fuels.” (emphasis added)). Notwithstanding the low bar for inclusion, we conclude, and discuss at greater length below, see infra § IV.J, that the EPA reasonably exercised its discretion when it subcategorized boilers this way. 82 We cannot say the same about the EPA’s exclusion of certain high-performing units from its MACT-floor calculation. Although the EPA allowed sources that combust only 10 per cent of a subcategory-defining fuel to join that subcategory, it declined to consider emissions from any source that burned less than 90 per cent of the subcategorydefining fuel when determining the average emissions level of the best performing sources in setting MACT floors for existing sources. And when it set a subcategory’s MACT floors for new sources, the Agency declined to consider the emissions levels from any source that did not burn 100 per cent of the fuel. This disparate treatment makes a difference; several sources excluded from the MACT-floor determination were among the best performing sources (or, in some cases, the single best performing source) in that fuelbased subcategory. The CAA, however, demands that source subcategories take the bitter with the sweet. Section 7412 mandates, without ambiguity, that the EPA set the MACT floor at the level achieved by the best performing source, or the average of the best performing sources, in a subcategory. See 42 U.S.C. § 7412(d)(3)(A), (B). It thus follows that if the EPA includes a source in a subcategory, it must take into account that source’s emissions levels in setting the MACT floor. The Agency, however, claims discretion to omit from MACT-floor computation sources it considers dissimilar. In support, it cites section 7412(d)(3), which provides that MACT standards must be no less stringent than “the best controlled similar source, as determined by the [EPA].” Id. § 7412(d)(3) (emphases added). Our decision in Sierra Club II, 479 F.3d 875, however, forecloses this argument. In Sierra Club II, the EPA set MACT standards for brick and 83 ceramic kilns. Id. at 879. For some subcategories, the EPA based its MACT-floor determination on “the pollution control devices used by the second-best performers,” not the best performers. Id. (emphasis added). Although the EPA argued that it “reasonably construe[d] the term ‘best performing’ . . . to allow it to consider whether retrofitting kilns with a particular pollution control technology is technically feasible,” id. at 880 (alterations in original), we held that the EPA could not circumvent the requirement that it base the MACT floor “on the emission level actually achieved by the best performers (those with the lowest emission levels).” Id. at 880-81 (citing Cement Kiln, 255 F.3d at 861) (emphasis in original). We reach the same conclusion here. The EPA tries to distinguish Sierra Club II, arguing that the issue in that case “was whether [the] EPA could exclude all units using the most-effective emission control technique because it might not be applicable to all existing units”; however, “[h]ere, [the] EPA is excluding a test result that is unrepresentative of typical operations of units in the subcategory, and thus is inappropriate to use in establishing the MACT floor.” No. 11-1108 EPA Br. 81. But it makes no difference whether the EPA exempts from consideration units with certain highly effective technology or units with impressive test results driven by the fuel combination it combusts. Either approach contravenes our holding in Sierra Club II that the EPA cannot ignore “the emission level actually achieved by the best performers (those with the lowest emission levels)” in the subcategory. 479 F.3d at 880 (emphasis omitted). In any event, the EPA has not simply excluded aberrant test results; it has excluded an entire class of units—those burning less than 90 per cent of the subcategory’s fuel—even though every one of those units fits 84 the subcategory’s parameters. This is no different from what we rejected in Sierra Club II. The EPA insists that if a source is “unrepresentative of typical operations of units in the subcategory,” it is “inappropriate to use [it] in establishing the MACT floor.” No. 11-1108 EPA Br. 81. Not so. “The idea is to set limits that, as an initial matter, require all sources in a category to at least clean up their emissions to the level that their best performing peers have shown can be achieved.” Sierra Club I, 353 F.3d at 980 (citing 42 U.S.C. § 7412(d)(3)). For this reason, an unusually high-performing source should be considered; indeed its performance suggests that a more stringent MACT standard is appropriate. Accordingly, we vacate the MACT standards for all major boiler subcategories that would have been affected had the EPA considered all sources included in the subcategories.20
Sections 7412 and 7429 create MACT-floor criteria that, for our purpose, are materially the same. Compare 42 U.S.C. 20 In its brief, the EPA argued that the Environmental Petitioners’ challenge was moot either because the challenged MACT standards had been remanded for other reasons or because inclusion of the allegedly dissimilar sources would not have affected the MACT standard. During oral argument, however, it conceded that it misunderstood the scope of the Petitioners’ argument, which argument challenges unremanded MACT standards that have in fact been affected by the EPA’s decision to omit certain high-performing sources from its MACT-floor analysis. See Oral Arg. Recording pt. B at 48:28-49:22. We believe that the Environmental Petitioners’ challenge is not moot and has not been waived. 85 § 7412(d), with id. § 7429(a)(2). In both provisions, the CAA mandates that MACT floors have maximum stringency but also be continuously achievable. See id. § 7412(d)(2), (k); id. § 7429(a)(2); id. § 7602(k). Satisfying the statutory criteria is no easy task, especially because no source emits any HAPs at a constant level. See Page Mem. 6. Rather, emissions levels fluctuate over time and for many reasons. See id. at 3.21 We have held, see Mossville Envtl. Action Now v. EPA, 370 F.3d 1232, 1242 (D.C. Cir. 2004), and recently reaffirmed, see NACWA, 734 F.3d at 1133-34, that the EPA can consider this variability when setting MACT floors. Further complicating the task is the way in which sources typically measure emissions. Virtually all of the data the EPA collects to set MACT floors come from the three-run stack test. Page Mem. 6. The three-run stack test, as the name suggests, involves three measurements of the source’s emissions taken over a short time period (i.e., no more than a few days) with each of the three test “runs” lasting from one hour to four hours. Id. at 3. Because the tests provide three “snapshots” of a source’s emissions performance, they cannot accurately represent the source’s full range of emissions over all times and under all conditions. Id. at 3-4. Because stack testing typically involves “three separate runs,” however, it “will in most cases show some of a particular source’s 21 See also Page Mem. 2-3 (“This variability occurs due to a number of factors, including measurement variability (both sampling and analysis) and short term fluctuations in the emission levels that result from short-term changes in fuels, processes, combustion conditions, and controls.”). 86 variability over the short period of time during which testing was conducted.” Id. at 6 (emphasis added).22
Based on the limitations inherent in stack testing, the EPA concluded that it could not set MACT floors based on that testing alone. It began using the UPL to account for the HAPs-emissions variety that stack-testing data do not reflect. See NACWA, 734 F.3d at 1122. The Agency did so in several rules promulgated in 2011, including not only the Major Boilers Rule and the CISWI Rule but also the Sewage Sludge Incinerator Rule addressed in NACWA. See id. In that case, the petitioners challenged the EPA’s UPL use, arguing that the Agency failed to establish that the UPL fairly represented the “average emissions limitation achieved” by the best performing sources to set the Sewage Sludge Incinerator MACT floors and, accordingly, was “unlawful and arbitrary.” Id. at 1130. We agreed in part. See id. at 1119. Specifically, we struggled to pin down the EPA’s precise interpretation of the phrase “average emissions limitation achieved by the best performing 12 percent of units.” Id. at 1142-43 (quoting 42 U.S.C. § 7429(a)(2)).23 As best we could tell, the EPA defended its use of the UPL as follows: “[b]ecause the [UPL] represents the value which [the EPA] 22 See also Page Mem. 5 (“[E]ven single three run tests, which are performed over a short period of time, typically show different emissions levels during each individual test run.”). 23 See also NACWA, 734 F.3d at 1142 (“[I]t seems EPA has adopted yet another interpretation of the phrase ‘average emissions limitation achieved by the best performing 12 percent of units.’” (emphasis added)). 87 can expect the mean (i.e., average) of three future observations (3-run average) to fall below, based upon the results of the independent sample size from the same population, the [UPL] reflects average emissions.” Id. at 1142 (quoting Standards of Performance for New Stationary Sources and Emission Guidelines for Existing Sources: Sewage Sludge Incineration Units, 76 Fed. Reg. 15,372, 15,389 (Mar. 21, 2011)) (emphasis added) (some alteration in original). In our view, however, “the word ‘average’ . . . seems to mean the average emissions limitation that the existing population of the best-performing 12 percent of incinerators has achieved.” Id. (emphases added). Despite these doubts, we reasoned that the EPA could have “plausibl[y]” concluded that the UPL represents the “average emissions limitation achieved” by the best performing sources. Id. at 1143. That said, we were not willing to assume the EPA’s responsibility of “supply[ing] a reasoned basis” for its UPL use. Id. (quoting Bowman Transp., Inc. v. Ark.-Best Freight Sys., Inc., 419 U.S. 281 (1974)). For that reason, we remanded—but did not vacate, see id. at 1161—the UPL portion of the Sewage Sludge Incinerator Rule and ordered the EPA to “clarify how the [UPL] represents the average emissions limitation achieved by the best performing 12 percent.” Id. at 1143 (internal quotation marks omitted).24 24 See also NACWA, 734 F.3d at 1151 (“[W]hile we determine that [the] EPA’s use of the [UPL] may be lawful, we are remanding this portion of its rulemaking for further explanation on the issue[] of how the upper prediction limit represents the average emissions limitation achieved . . . .” (internal quotation marks omitted)). 88 Because the EPA also used the UPL in the Major Boilers Rule and the CISWI Rule, the Agency moved for a limited remand of the current petitions so that it could include its revised UPL explanation in the administrative records of these two regulations.25 See Page Mem. 2. On July 14, 2014, the EPA published a fifteen-page memorandum authored by Stephen D. Page, the EPA Director of Air Quality Planning and Standards (Page Memorandum), in response to NACWA. See id. at 1. The EPA’s current explication of the UPL is now before us.26 25 In NACWA, we had other problems with the EPA’s use of the UPL. Specifically, the EPA had explained that “a smaller dataset may have greater variability, and thus a higher [UPL].” NACWA, 734 F.3d at 1144. We instructed the EPA not only to explain its use of the UPL in general but also to “explain why the [UPL] could still be considered accurate given a small dataset” in particular. Id. at 1144-45 (emphasis added). In its remand motion, the EPA represented that it could “adequately explain why [its] use of the UPL in general is consistent with Clean Air Act requirements through a remand of the record for a limited time” but that “the question of whether the UPL is an appropriate statistical method for small data sets requires more analysis . . . [along with] additional notice and comment rulemaking.” No. 11-1108 Mot. for Remand 9, 13 (Feb. 28, 2014). We agreed and, for this reason, the only issue we decide today is whether the EPA carried its burden of establishing, as a general matter, that the UPL reasonably estimates the average emissions level achieved by the best performing source or sources to set MACT floors. 26 The Environmental Petitioners urge us to ignore the Page Memorandum, insisting that it “provide[s] a series of new interpretations and assertions that, rather than ‘explaining’ the prior record, instead contradict and revise the agency’s earlier position,” in contravention of NACWA and the scope of the remand the Agency requested regarding the Major Boilers Rule and the CISWI 89
The Page Memorandum recognized our “concern about the interpretation [we] believed [the] EPA was taking” of the word “average.” Page Mem. 3. It clarified that the Agency “does not interpret the term ‘average’” to mean “the average of a future 3-run compliance test.” Id. (emphasis added) (quoting NACWA, 734 F.3d at 1143). Rather, it explained that the “EPA interprets the average to mean the average emissions over time,” based not only on the “average of all emissions test data from the best performing source or sources” but also on “information regarding the variability of emissions.” Id. (emphasis added). In the EPA’s judgment, “variability is a key factor in establishing” MACT standards because “[e]ach MACT standard is based on limited data from sources whose emissions are expected to vary over their long term Rule. No. 11-1108 Envtl. Pet’rs’ Br. 41. But our NACWA decision did not, as the Petitioners would have it, require the EPA to adopt our belief that the Agency construed “average” to mean “the average of a future 3-run compliance test.” See NACWA, 734 F.3d at 1143. Rather, we asked the EPA to clarify how, in its view, the UPL “represents the ‘average emissions limitation achieved by the best performing 12 percent.’” Id. (emphasis added). Nor do we think that the EPA altered its initial basis for using the UPL, which the EPA has consistently held out as “a statistical formula designed to estimate a MACT floor level that is equivalent to the average of the best performing sources based on future compliance tests.” 2011 Major Boilers Rule, 76 Fed. Reg. at 15,630 (emphasis added). What the EPA failed to do before NACWA was to explain how the UPL functions and why it is a reasonable way to calculate “average” emissions levels. The Page Memorandum does precisely that. 90 performance.” Id. Specifically, “[t]he available emissions data are generally in the form of short term, three-run stack tests, with each test run lasting for between 1 and 4 hours.” Id. For this reason, the EPA concluded that it did not have information “encompass[ing] the emissions performance of a source over time.” Id. (emphasis added). And because the “EPA interprets ‘emissions performance’ . . . to mean the emissions of a source over the long term, rather than just during a short-term stack test,” the EPA found it necessary to “appl[y] a methodology that predicts the actual emissions levels the source is achieving at times other than when stack testing was conducted.” Id. at 3-4 (emphases added). The UPL is the methodology the EPA selected to account for these limitations. Id. at 4. “[A] value derived from widely accepted and commonly used statistical principles,” the UPL “represents the upper end of a prediction interval.” Id. In layman’s terms, the UPL uses an equation that considers (1) the average of the best performing source or sources’ stack-test results (i.e., the mean); (2) the pattern the stack-test results create (i.e., the distribution); (3) the variability in the best performing source or sources’ stack-test results (i.e., the variance); and (4) the total number of stack tests conducted for the best performing source or sources (i.e., the sample size). Id. at 4-5. The UPL, however, cannot demonstrate with absolute certainty the average emissions levels achieved by the best performing sources at all times (indeed, certainty is impossible without continuous monitoring). See id. Instead, the UPL equation produces a range of values that is expected, given the variance in the relevant stack-test data, to encompass the average emissions levels achieved by the best performing sources a specified percentage of the time. Id. at 91 4. To establish the MACT floor, the EPA calibrated the UPL equation to produce a range in which the average emissions levels of the best performing source or sources would be expected to fall 99 per cent of the time, which is referred to as a 99 per cent confidence interval. Id. Once the EPA had this range, it set the MACT floor at the top level of that range— hence, the “upper” in “upper prediction limit”—to arrive at a figure that, 99 out of 100 times, it expected the average emissions levels of the best performing sources to “achieve.” Id. Or, in the EPA’s words, “the 99 percent UPL is the level of emissions that” the EPA is “99 percent confident is achieved by the average source represented in a dataset over a long-term period based on its previous, measured performance history as reflected in short term stack-test data.” Id. One of the equations the EPA used to calculate the UPL is as follows:27 27 The EPA used “one of several equations” to calculate the UPL depending on “certain characteristics of [the] dataset,” including the distribution of data within the dataset. Page Mem. 4. Here, we set out the equation the EPA used for a dataset with a “normal distribution.” Id. at 10. For our review, we need not recount the other, somewhat more complicated equations the EPA used in determining the UPL for datasets with, e.g., a “lognormal distribution.” See id. (“Even though they differ due to separate mathematical properties associated with each distribution, the UPL equations share a common format . . . .”); see generally id. at 11 (describing lognormal distribution equation). 92 NACWA, 734 F.3d at 1139. In this equation:  “x̄ ” is the mean;  “t(0.99, n-1)” is a value called the “t-statistic,” the statistical tool used to set the confidence interval (here, 99 per cent);  “n” is the sample size;  “m” is the number of stack tests that were run to calculate the mean (“x̄ ”); because most stack tests involve 3 “runs,” m usually equals 3;  “s” represents the “standard deviation.” See id.; see also Page Mem. 10-11.
After the EPA issued the Page Memorandum, the Environmental Petitioners renewed their argument that the UPL represents neither (1) the “average” emissions limit of the best performing source or sources in a subcategory, nor (2) the emissions levels “achieved” by the best performing sources in a subcategory. We believe that the EPA has carried its burden of demonstrating that the UPL “reflect[s] a reasonable estimate of the emissions achieved in practice by 93 the best performing sources.” Cement Kiln, 255 F.3d at 87172 (internal quotation marks omitted); see also NACWA, 734 F.3d at 1148 (“[H]aving decided to account for variability, and having decided to estimate that variability, EPA bears the burden of demonstrating with substantial evidence that its estimate is reasonable.”). Our conclusion is driven, in large part, by the deference we owe the EPA when it determines how best to meet the technical challenges in its area of expertise. Indeed, the EPA “typically has wide latitude in determining the extent of datagathering necessary to solve a problem” and, for that reason, we have “accorded Chevron deference to [its] interpretation of [the CAA] as allowing it to estimate MACT floors.” NACWA, 734 F.3d at 1131. Moreover, “the requirement that the existing unit floors not be less stringent than the average emissions limitation achieved by the best performing 12 percent of units does not, on its own, dictate how the performance of the best units is to be calculated,” id. (internal quotation marks omitted)—“[f]loors need not be perfect mirrors of the best-performers’ emissions,” Cement Kiln, 255 F.3d at 871. So long as the EPA “demonstrate[s] with substantial evidence—not mere assertions”—that the UPL “allows a reasonable inference as to the performance of the top 12 percent of units,” NACWA, 734 F.3d at 1131 (quotations omitted) (emphasis added), the EPA has conducted reasoned decision making. The Agency has done so here. The Page Memorandum explains the limitations of stack-test data—i.e., the “snapshots” cannot reflect the best performing source’s or sources’ average emissions levels at all times and under all operating conditions. Page Mem. 6. The Page Memorandum also explains that the Agency chose the UPL as a tool 94 “derived from widely accepted and commonly used statistical principles,” id. at 4, that “reasonably account[s] for variability in the emissions of . . . sources,” id. at 2. Finally, the Page Memorandum plugs the analytical gap we identified in NACWA—it thoroughly explains how and why the UPL accounts for the variance and therefore how and why it reasonably represents the emissions level “achieved by the average source” or sources. Id. at 3-5. In so doing, the EPA has “clarif[ied],” to our satisfaction, “how the upper prediction limit represents the average emissions limitation achieved.” NACWA, 734 F.3d at 1143 (internal quotation marks omitted). The Environmental Petitioners’ arguments to the contrary are unavailing. Their primary objection is that the UPL cannot reasonably estimate the “average” emissions level achieved by the best performing source or sources because the UPL represents “a level [the] EPA expects any future compliance test by any [source] in the top 12 percent to fall below.” No. 11-1108 Envtl. Pet’rs’ Br. 35 (emphases added) (internal quotation marks omitted).28 But the Page Memorandum counters the Environmental Petitioners’ mistaken understanding of what the UPL represents.29 According to the EPA, “the UPL does not represent the worst emissions performance of the best performing units at any 28 See also No. 11-1108 Envtl. Pet’rs’ Reply Br. 15 (“It is, as its name indicates, an upper limit—the emissions limitation that every member of the best-performing 12 percent will fall below . . . .” (emphasis in original) (quotation marks omitted)). 29 The Environmental Petitioners’ argument rests, at least in part, on their contention that we should not consider the Page Memorandum at all. We decline their invitation to ignore the explanation we ordered the EPA to provide. 95 time.” Page Mem. 4 (emphasis in original).30 It is instead “the average level expected to have been achieved over time” by the best performing source or sources. Id. (emphasis in original). “In other words, the 99 percent UPL is the level of emissions that [the EPA is] 99 percent confident is achieved by the average source . . . over a long-term period based on its previous, measured performance history as reflected in short term stack test data.” Id. (emphasis added). Next, the Environmental Petitioners criticize the Page Memorandum’s explanation that the UPL represents the longterm average emissions levels achieved because “the first element of the UPL equation is the average of the short-term emissions test data from the best-performing sources.” Id. In their view, the UPL is no different from “saying that, over time, the average of 1, 2, and 3 = 2 + 500 because the first element in the equation (2) is the average of 1, 2, and 3.” No. 11-1108 Envtl. Pet’rs’ Br. 48. But the UPL does not simply tack an arbitrary increase on top of the stack-test average of the best performing sources. Rather, the UPL “allows [the] EPA to use emissions test data and the data characteristics,” which include “the distribution and sample size, along with the intrinsic variability associated with those data,” to estimate “an emissions limit based on a specified level of confidence such that an average best performing existing 30 See also Page Mem. 5 (It is “generally . . . reasonable to establish a [MACT floor] standard that all the best performing 12 percent of existing sources can meet without any modification because the statute requires the Agency to establish the standard at the average level of performance of the best 12 percent of sources.” (emphasis in original)); id. at 14 (“[T]he MACT floor represents the average emission level achieved by the best performing sources, not the worst emission level achieved by those sources.” (emphases in original)). 96 source would not be expected to exceed the limit a specified number of times.” Page Mem. 6 (emphases added). In other words, the UPL does not simply add an arbitrarily chosen value but instead turns entirely on the features inherent in the stack-test data and how those features reflect the natural variance in emissions experienced by the best performing sources over time. See id. at 4 (“[T]he MACT floor calculation takes into account the inherent variability in emissions performance to more accurately reflect the range of the best performing sources’ emissions over time.” (emphasis added)).31 Thus, as the Page Memorandum amply demonstrates, see id., the EPA’s use of the UPL is not arbitrary. The Environmental Petitioners also attack the results produced by the UPL. They provide a series of charts that, in their view, demonstrate that the UPL sets MACT floors far too high to comport with the CAA’s mandate that floors represent “the maximum degree of reduction in emissions.” See 42 U.S.C. § 7412(d)(2). True, some of the charts show that the EPA has set a MACT floor above the highest emissions level recorded by the best performing sources’ stack testing. See No. 11-1108 Envtl. Pet’rs’ Br. 14-15; No. 11-1108 Envtl. Pet’rs’ Reply Br. 23. But this does not mean that the UPL is an arbitrary “average” proxy—for at least two reasons. 31 See also Page Mem. 6-7 (“[T]he UPL equation that is used to account for variability and [to] calculate the MACT floor standard depends on the distribution of the data.”); id. at 11 (“The UPL . . . is directly related to the confidence level and to the variance, meaning that as either of these values go up or down, so does the UPL value.”). 97 First, the charts selectively included are generated from data sets with considerable variance between the highest recorded stack test and the lowest. Unsurprisingly, if a handful of “snapshots” in a data set demonstrate that emissions levels experience high spikes and low plummets at discrete times, it is more likely that the average emissions level achieved by the best performing sources at all times might be high. This is because a data set with high variability will produce a higher UPL than a data set with low variability, even if the two sets share the same average. In other words, the UPL takes large variance into account and therefore naturally goes higher to arrive at the 99 per cent certainty the EPA thinks is appropriate.32 Second, where the UPL suggested a MACT floor higher than the results of the stack tests, it often did so by insubstantial amounts. Indeed, for at least one chart, “the limit is a mere 4 millionths of a pound per million Btu above the emissions test results of best performers, an unalarming amount given that the methodology is supposed to account for variable results.” No. 11-1108 Indus. Intervenors’ Br. 10 (emphases in original). For these reasons, the Environmental Petitioners have not convinced us that the EPA failed to satisfy the 32 The EPA “selected the 99 percent level in order to provide reasonable assurance that the limit can be met at all times by a source with emissions at the average level achieved by the best performing source or sources.” Page Mem. 10. The Environmental Petitioners have not challenged the EPA’s choice of a 99 per cent confidence level, as opposed to a lower level of certainty, and we express no opinion on that choice. And we reiterate that the more specific concerns we had with the UPL when we decided NACWA—in particular, the UPL’s accuracy “given a small dataset”—are not before us. 734 F.3d at 1144-45. 98 “minimal standard[] of rationality” that we require. Ethyl Corp. v. EPA, 541 F.2d 1, 36 (D.C. Cir. 1976) (en banc). Finally, the Environmental Petitioners insist that “[t]he UPL predicts a level that hypothetical future tests will fall below, rather than estimating what boilers actually achieved,” in contravention of the requirement that MACT floors “reflect what the best-performing sources achieved.” No. 11-1108 Envtl. Pet’rs’ Reply Br. 24 (internal quotation marks omitted). But the Environmental Petitioners ignore the Page Memorandum’s explanation that, because the UPL is not time-dependent, it “not only is a prediction of the emissions performance of those sources in tests conducted in the future, but is also an indication of the range of current average emissions performance of those units.” Page Mem. 3;33 see also No. 11-1108 Indus. Intervenors’ Br. 9 (“Because this statistical method is not time-dependent, it is equally valid for predicting past performance (i.e., the range of emissions levels expected to have been experienced in the past by the best performers during periods when actual emissions testing was not underway) and future performance.”). We believe that the UPL “reflect[s] a reasonable estimate of the emissions achieved in practice by the best-performing sources,” Cement Kiln, 255 F.3d at 871-72 (internal quotation marks omitted), and, accordingly, we reject the Environmental Petitioners’ challenge to it. 33 See also Page Mem. 4 (“[T]he 99 percent UPL is the emissions level that the source would be predicted to be below 99 out of 100 performance tests, including emissions tests conducted in the past, present, and future.”); id. at 10 (“The confidence level, in this case 99 percent, is the percentage of measurements (past, present, and future) that are predicted to fall at or below the UPL value.”). 99
The EPA declined to set beyond-the-floor standards for CISWI units. The Environmental Petitioners challenge that determination in three primary respects, each of which we reject.34 Section 7429 of the CAA directs the EPA to set MACT standards in two steps. It first sets a floor level based on the best performing sources. See 42 U.S.C. § 7429(a)(2). Next, it determines “whether a more restrictive standard is ‘achievable,’” NRDC III, 749 F.3d at 1057, “taking into consideration the cost of achieving such emission reduction, and any non-air quality health and environmental impacts and 34 Although the EPA does not argue that the court lacks jurisdiction to consider this argument, Environmental Petitioners raise the issue defensively, contending that they satisfied the CAA’s administrative exhaustion provision. We agree. During the rulemaking process, the Petitioners comprehensively critiqued the EPA’s proposed rationale for rejecting beyond-the-floor standards. See, e.g., Natural Resources Defense Council, Comments on Standards of Performance for New Stationary Sources and Emission Guidelines for Existing Sources, EPA-HQ-OAR-20030119 (Aug. 23, 2010), at 11-16 (No. 11-1125 J.A. 668-73). Many of those comments challenged the EPA’s consideration of costs and other factors—the same types of issues Petitioners now ask the Panel to resolve. Because the Environmental Petitioners raised the relevant issues “with reasonable specificity” during the period for public comment, our jurisdiction is not in question. 42 U.S.C. § 7607(d)(7)(B); see Portland Cement Ass’n v. EPA, 665 F.3d 177, 186 (D.C. Cir. 2011) (“While we certainly require some degree of foresight on the part of commenters, we do not require telepathy. We should be especially reluctant to require advocates for affected industries and groups to anticipate every contingency.”). 100 energy requirements,”35 42 U.S.C. § 7429(a)(2). The “EPA calls these stricter requirements ‘beyond-the-floor’ standards.” NRDC III, 749 F.3d at 1057. In section 7429, the “Congress gave EPA broad discretion in considering whether to go beyond-the-floor.” NACWA, 734 F.3d at 1157. The Congress required the EPA to consider a variety of factors without telling the EPA how to weigh them. That calculus belongs to the EPA’s discretion. See 42 U.S.C. § 7429(a)(2) (delegating to the EPA Administrator the responsibility to “tak[e] into consideration” the statutory factors). Against that backdrop, challenges to the EPA’s beyond-the-floor determinations “must clear a high bar, as we are at our most deferential when an agency is ‘making predictions, within its area of special expertise, at the frontiers of science.’” NACWA, 734 F.3d at 1156 (quoting Husqvarna, 254 F.3d at 199). When establishing MACT standards for CISWI, the EPA declined to establish beyond-the-floor standards in the proposed rule, see 2010 Proposed CISWI Rule, 75 Fed. Reg. at 31,956-59, and the final rule, see 2011 CISWI Rule, 76 Fed. Reg. at 15,729-32. The EPA also declined requests to reconsider that decision. See Memorandum from Eastern Research Group, Inc., to Amy Hambrick, U.S. Environmental Protection Agency, Revised Draft CISWI Reconsideration Issues (Dec. 20, 2012), at 22-23 (No. 11-1125 J.A. 1219-20). 35 EPA interprets the statutory factor of “cost” to permit consideration of cost-effectiveness, NRDC III, 749 F.3d at 1060-61, which is often calculated “on [a] per ton of emissions removed basis,” Husqvarna AB v. EPA, 254 F.3d 195, 200 (D.C. Cir. 2001). We have previously upheld that interpretation. See, e.g., NRDC III, 749 F.3d at 1060-61. 101 The first challenge targets several instances in which the EPA refused to require sources to adopt, as a beyond-the-floor measure, controls that most sources would employ to meet the MACT floor standard. In each instance, the EPA determined that the relative costs outweighed the expected emissions gains. In the first such case, the EPA decided not to require liquid-fired energy recovery units to install dry sorbent injection and fabric filters as a beyond-the-floor measure, despite the fact that “four of the six” units would need to install those systems to meet the floor standard. 2011 CISWI Rule, 76 Fed. Reg. at 15,731. That decision satisfied the statute. Had the EPA mandated the control measures, the remaining two units would have needed to expend “$1.1 million per year” to achieve only a small emissions reduction, “which translates into an incremental cost-effectiveness of about $230,000 per ton” of emission. Id. Nothing in section 7429(a)(2) requires the Agency to impose a cost so disproportionate to the expected emissions gains. The Environmental Petitioners take issue with two other decisions along these lines. In the first, the EPA declined to set beyond-the-floor mercury control measures for kilns, citing a cost-effectiveness of roughly $351 million per ton. See Memorandum from Eastern Research Group, Inc., to Toni Jones, U.S. Environmental Protection Agency, Final Reconsideration Beyond-the-Floor Analysis for CISWI Units (Reconsideration Mem.) (Dec. 20, 2012), at ¶ 3.4.2 (No. 111125 J.A. 1232). In the second, a $26,000 per-ton implementation cost led the Agency not to establish stricter carbon monoxide control measures for calciner kilns. See id. ¶ 3.4.3. Energy use—a factor mandated in section 7429(a)(2)—also entered the equation. With respect to calciner kilns, the technology used to reduce carbon 102 monoxide would also increase energy requirements, and therefore increase energy costs. See id. In each of these decisions, the EPA reasonably applied the statutory factors. That Petitioners would have weighed the costs differently provides no grounds to displace the EPA’s otherwise reasonable determination. In the second challenge to the decision not to set beyondthe-floor standards, the Environmental Petitioners contend the Agency arbitrarily failed to set emission levels lower than the MACT floor for categories likely to adopt technology capable of meeting those lower levels. Specifically, according to the Environmental Petitioners, the EPA knew waste-burning kilns and energy recovery units would adopt fabric filters that “achieve particulate matter emissions levels dramatically lower than the floor, but refused to set the standard at that lower level.” See No. 11-1125 Envtl. Pet’rs’ Br. 50. That is incorrect. The Environmental Petitioners spin this yarn based on a line in the proposed rulemaking. There, the Agency speculated that kilns and energy recovery units would adopt fabric filters to comply with the MACT floor limit, and would “likely achieve a level of performance” below the floor. 2010 Proposed CISWI Rule, 75 Fed. Reg. at 31,958. That statement represented a preliminary prediction, which was subject to change during the notice-and-comment process. And change it did. In the final rulemaking, the EPA further subcategorized the energy recovery unit subcategory and revised the MACT floor for waste-burning kilns. See 2013 CISWI Rule, 78 Fed. Reg. at 9,122 (explaining the changes). New information received during the rulemaking inspired those changes, which the EPA made after considering the statutory factors. See id.; Reconsideration Mem., ¶ 2.3-3.4.5. The evidence does not suggest that the 103 EPA refused to set beyond-the-floor emission levels it knew were reasonably achievable.36 In the third challenge, the Environmental Petitioners take issue with three determinations that rested on factors other than cost. First, the EPA declined to require coal-fired energy recovery units to adopt linkageless boiler management systems as a beyond-the-floor measure for carbon monoxide. See Reconsideration Mem., ¶ 2.3.1.1. While acknowledging that linkageless systems were available at “fairly low-cost,” the EPA concluded it had insufficient data to determine the “actual reductions this control option would achieve” relative to an alternative control system. Id. The EPA acted reasonably. The record suggests the EPA had scant evidence on the efficacy of linkageless control measures applied to coal-fired energy recovery units. See id. Had the Agency imposed a stricter standard based on controls for which it had precious little (if any) evidence, a reviewing court may well have concluded the decision lacked “a rational connection between the facts found and the choice made.” State Farm, 463 U.S. at 43 (internal quotation marks omitted). Second, the EPA rejected regenerative thermal oxidizers as a beyond-the-floor control for carbon monoxide in solid waste energy recovery units. See 2011 CISWI Rule, 76 Fed. Reg. at 15,732. Thermal oxidizers could do the job “but likely at a far greater energy requirement (specifically natural 36 This argument suffers from an additional flaw: the Environmental Petitioners appear to treat as interchangeable proposed emissions rules for new units with the final rules applicable to existing ones. That apples-and-oranges comparison underscores the weakness of the argument. 104 gas) [and] with comparable control efficiency” as carbon monoxide catalysts, which “some units will need to install to meet the MACT floor . . . limits.” Id. In other words, even though oxidizers work as well as carbon catalysts, oxidizers would be unsuitable because they use more energy. See id. (concluding that beyond-the-floor controls “would be unreasonable for this subcategory due to additional cost and energy impacts”). The Environmental Petitioners contend that the EPA failed to “suggest that these natural gas requirements are high in an absolute sense or relevant to achievability.” No. 111125 Envtl. Pet’rs’ Br. 51. We agree that the EPA’s analysis is less than fully satisfying. Among other reasons, nowhere did the Agency estimate the per-ton cost of mandating thermal oxidizers, or compare the energy costs relative to other control measures. Despite these imperfections, we reject the challenge. See Dist. Hosp. Partners, L.P. v. Burwell, 786 F.3d 46, 61 (D.C. Cir. 2015) (“[I]mperfection alone does not amount to arbitrary decision-making.”). The EPA’s somewhat sparse analysis on this issue reflects a somewhat sparse record. At bottom, the Agency rejected thermal oxidizers because it lacked sufficient evidence to support their utility, at least compared with control measures whose efficacy and costs were better known. The Agency’s determination should be read in context. Elsewhere in the final rule, the EPA expanded on the energy and environmental impacts of thermal oxidizers, concluding that “[t]he combustion of fuel needed to generate additional electricity and to operate [thermal oxidizer] controls would yield slight increases in emissions, including NOX, CO, PM, and SO2 and an increase in CO2 emissions.” 2011 CISWI 105 Rule, 76 Fed. Reg. at 15,744. The EPA addressed another statutory factor—cost—by reasonable implication. Energy— natural gas, in this case—is not free. A technology that demands “far greater energy requirement[s]” naturally comes at a cost. See id. at 15,732. Though courts are powerless to “supply a reasoned basis for the agency’s action that the agency itself has not given,” “[w]e will . . . uphold a decision of less than ideal clarity if the agency’s path may reasonably be discerned.” State Farm, 463 U.S. at 43 (internal quotation marks omitted). Here, the Agency’s path may reasonably be discerned: mandating thermal oxidizers was not achievable due to increased energy demands and a corollary increase in cost, see 2011 CISWI Rule, 76 Fed. Reg. at 15,732 (declining to set a beyond-thefloor limit “due to additional cost and energy impacts”). For those reasons, EPA did not act unreasonably. Third, and finally, the Environmental Petitioners challenge the rejection of dry sorbent injection and wet scrubbers as beyond-the-floor measures for waste-burning kilns. The EPA determined those measures would be costeffective (at only $5,000 per ton) but declined to require them due to “uncertainty” surrounding “the appropriate control system that some existing kilns would need to employ to meet” a stricter standard, “especially kilns that use ingredients with a high sulfur content.” See Reconsideration Mem., ¶ 3.4.5. Adding to that uncertainty, the EPA could not “account for potential costs at existing sources for additional scrubber water and spent sorbent.” Id. As before, the EPA reached a reasonable conclusion in the face of imperfect information. Had the EPA set a beyond-the-floor standard based on sorbent injection and wet scrubbers, the Agency 106 would have been flying blind. In avoiding that course, we conclude the EPA acted reasonably.
The final CISWI Rule did not contain emission standards for burn-off ovens, cyclonic burn barrels, foundry sand reclamation units, soil treatment units, and space heaters. The Environmental Petitioners claim that the EPA unlawfully exempted these units from regulation by creating subcategories that capture only a subset of the units that the Agency is required to regulate as CISWI. The EPA, however, protests that it did not exempt these five types of units from regulation. Rather, the Agency determined that it lacked sufficient data to regulate the units at this time, and, with respect to some, it received comments suggesting the units were not CISWI.37 37 The EPA asserts that it has not made a final decision with regard to the regulation of the five units at issue here—a claim that calls into question our jurisdiction, which under the CAA is limited to “final” actions. See Portland Cement, 665 F.3d at 193 (citing 42 U.S.C. § 7607(b)). We disagree with the Agency. Because the statutory deadline for the EPA to establish emission standards for all CISWI has passed, see 42 U.S.C. § 7429(a)(1)(D), “the promulgated regulations must be deemed the [A]gency’s complete response in compliance with the statutory requirement[].” Hercules Inc. v. EPA, 938 F.2d 276, 282 (D.C. Cir. 1991) (internal quotation marks omitted). Accordingly, “even if [the Agency] promulgates additional . . . rules sometime in the future, petitioners’ claim that the existing final regulations are unlawful remains reviewable by this court.” Id. (internal quotation marks omitted). Moreover, the EPA did not signal in the administrative record that it was “continu[ing] the rulemaking process” as to these five units. Portland Cement, 665 F.3d at 194 (holding that the EPA’s action 107 We agree with the Environmental Petitioners that the Agency has violated its nondiscretionary statutory duty (1) to promulgate standards with respect to cyclonic burn barrels, and (2) to determine whether the remaining four types of units fall within the statutory definition of CISWI. The CAA requires the EPA to “establish performance standards . . . for each category of solid waste incineration units” no later than November 15, 1994. See 42 U.S.C. § 7429(a)(1)(A), (D). The statute then defines “solid waste incineration unit” as a “distinct operating unit of any facility which combusts any solid waste material from commercial or industrial establishments or the general public.” Id. § 7429(g)(1) (emphasis added). That provision unambiguously requires the EPA to set emission standards for “any facility that combusts any commercial or industrial solid waste material at all,” subject only to the listed statutory exceptions. NRDC I, 489 F.3d at 1257-58. Because the statutory deadline to regulate these units has long passed, the EPA has “breached a nondiscretionary duty” if it has failed to promulgate standards for any facilities combusting solid waste from commercial or industrial establishments that do not fit into the listed exceptions. Sierra Club v. EPA, 992 F.2d 337, 346 (D.C. Cir. 1993); cf. id. (explaining that the “plain language” of a similar provision in RCRA “obligates the Agency to issue, by the deadline, revisions for all facilities” covered by the statute and therefore “does not contemplate partial compliance”). The Agency makes no effort to claim that cyclonic burn barrels fall outside the statutory definition for CISWI units. was not “final” under 42 U.S.C. § 7607(b) because the Agency expressly stated in its final rule that the rulemaking process remained underway). We therefore need not consider whether our conclusion regarding finality would change had it done so. 108 Nor could it—both the administrative record and the EPA’s brief make clear that cyclonic burn barrels “combust” solid waste. See 2011 Proposed CISWI Rule on Reconsideration, 76 Fed. Reg. at 80,460 (describing a cyclonic burn barrel as “a combustion device for waste materials”); No. 11-1125 EPA Br. 68 (same); see also 42 U.S.C. § 7429(g)(1) (defining “solid waste incineration unit” as a “distinct operating unit of any facility which combusts any solid waste material from commercial or industrial establishments or the general public”). Because they combust solid waste, cyclonic burn barrels clearly fall within the statutory definition of “solid waste incineration unit” and, as established above, the EPA had a nondiscretionary statutory duty to establish emission standards for all these units by 1994. We therefore conclude that the Agency violated that duty by failing to promulgate emission standards for cyclonic burn barrels. The EPA protests that it reasonably chose not to regulate cyclonic burn barrels at this time, given how little information it had on them. According to the EPA, comments revealed there were many more cyclonic burn barrels in use than originally thought, the Agency lacked data on these units, and it was “difficult, if not impossible, to test such units for the section 7429 pollutants.” No. 11-1125 EPA Br. 69. But this argument misses the point: in light of the unambiguous statutory command to promulgate numeric standards for all solid waste incineration units, the EPA had no discretion to avoid regulating any such units—even if its choice to avoid regulating these units would have been otherwise reasonable. The Agency was obligated to collect the data it needed, and Congress gave it the authority to do so. See 42 U.S.C. § 7414(a) (explaining that for the purpose of regulating solid waste combustion under section 7429, the EPA may, for example, require owners and operators of those units to 109 sample emissions, keep records, and offer other information that the Agency needs). Moreover, the Agency provides no evidence that it would be infeasible to set emission standards for these units. Instead, the EPA merely states that it “received information” that measuring emissions is difficult, “if not impossible,” but points to no comments or evidence supporting this assertion. 2011 Proposed CISWI Rule on Reconsideration, 76 Fed. Reg. at 80,460. The EPA also had a duty to determine whether the other challenged sources—burn-off ovens (including foundry sand reclamation units), soil treatment units, and space heaters— were units that “combust” solid waste. Several commenters told the Agency that these units fell within the statutory definition of CISWI, and the EPA itself initially viewed some of these units as combusting waste. See, e.g., CISWI Rule— Responses to Comments, at 74-76; 2010 Proposed CISWI Rule, 75 Fed. Reg. at 31,941. Under these circumstances, the Agency was obligated to determine whether the units in fact combust solid waste. Yet the EPA concedes it never made that determination. As we have explained, the EPA had a nondiscretionary duty to promulgate standards for all solid waste combustion units. This obligation includes the subsidiary duty to determine whether the units identified by the commenters in fact combust solid waste. Any other conclusion would allow the Agency to ignore its statutory mandate altogether by not taking the initial step of identifying such units. The CAA unambiguously requires that the Agency establish standards for all CISWI units. As a result, we grant the Environmental Petitioners’ petition for review on this issue and remand to the Agency to set emission standards for cyclonic burn barrels. The EPA must also determine whether 110 the remaining four types of units are CISWI units and, if it finds that they are, it must set standards for them as well.
In contrast to major source subcategories (all of which the EPA must control), the CAA does not require the EPA to control emissions in every area source subcategory. See 42 U.S.C. § 7412(c)(1), (3). The Act does, however, mandate that the EPA control area source emissions if the area source subcategory meets certain criteria. Section 7412(c)(1), for instance, requires the EPA to control any area source subcategory upon the Agency’s finding that emissions from the sources in the subcategory jeopardize either the environment or human health. See id. § 7412(c)(3). If so, the EPA can establish either a MACT or a GACT standard. See id. § 7412(d)(5). Similarly, if the EPA finds that capping emissions from an area source subcategory is necessary to achieve a 90 per cent reduction in the aggregate emissions of one of seven CAA-enumerated HAPs, section 7412(c)(6) requires the Agency to impose caps in that subcategory as well. See id. § 7412(c)(6). Upon that finding, however, the EPA must impose a MACT standard. Id. In addition to prescribing requirements for inclusion of area source subcategories, the CAA provides a mechanism for removal of area source subcategories that, in the EPA’s view, no longer need to be controlled. Specifically, the EPA can “delete” any subcategory if it finds that no source or group of sources in it (1) emits cancer-causing HAPs at a volume sufficient to increase the lifetime risk of cancer in the population by more than one in one million and (2) emits noncancer-causing HAPs at a level in excess of that which is adequate “to protect public health with an ample margin of 111 safety” and to prevent against environmental harm. Id. § 7412(c)(9)(B). The section 7412(c)(9) process is known as “delisting.” In 1998, the EPA identified several area source boiler subcategories—including oil-fired, industrial wood, commercial oil-fired and commercial wood-combustion boilers—as contributors to the “90 per centum of the aggregate emissions” of Hg and POM under section 7412(c)(6). See Source Category Listing for Section 112(d)(2) Rulemaking Pursuant to Section 112(c)(6) Requirements, 63 Fed. Reg. 17,838, 17,839 (Apr. 10, 1998). When it decided to “list” these sources, however, the EPA included a caveat. It explained that it used the best emissions information it had at the time to conclude that these boiler subcategories produced enough Hg and POM emissions to justify section 7412(c)(6) control but it also admitted that it could not “assure that this calculation of the 90 percent will remain constant.” Id. at 17,840. The caveat proved prescient. When the EPA issued the 2010 Proposed Area Boilers Rule, it decided it needed to regulate only coal-fired boilers at the MACT level to control 90 per cent of Hg emissions. See 75 Fed. Reg. at 31,898. And when it finalized the 2011 Area Boilers Rule, the Agency similarly decided that it needed to regulate only coal-fired boilers at the MACT level to control 90 per cent of POM emissions. See 76 Fed. Reg. at 15,566. For this reason, the EPA established GACT, rather than MACT, standards for the oil-fired and biomass-fired area source subcategories regarding these two pollutants. See id. It did not, however, make any of the “delisting” findings required by section 7412(c)(9) when it removed these area 112 source subcategories from section 7412(c)(6)’s purview. See 2011 Area Boilers Rule, 76 Fed. Reg. at 15,566 (“[W]e have not removed or ‘delisted’ oil-fired and biomass-fired area source boilers by this action. We are not promulgating MACT-based regulations at this time because they are unnecessary to meet the requirements of CAA section 112(c)(6).”). The Environmental Petitioners challenge the EPA’s imposition of GACT standards, arguing that, because once the EPA “listed” these sources under section 7412(c)(6)’s MACT requirement, the CAA mandates that the EPA “delist” them under section 7412(c)(9) before putting them under the more lenient GACT standards. In their view, the EPA’s contrary approach fails at Chevron step 1. The EPA responds that section 7412(c)(9) applies only if it decides to “delist” a subcategory entirely from section 7412 regulation, resulting in neither MACT nor GACT restrictions. Because section 7412(c)(9) does not unambiguously apply to section 7412(c)(6) and because the EPA’s interpretation of section 7412(c)(9)’s delisting requirement is reasonable, we uphold the EPA’s decision as permissible under Chevron step 2. Section 7412(c)(9) provides that the EPA “may delete any source category from the list under this subsection” on its finding that the source category is not a threat to human health or the environment. 42 U.S.C. § 7412(c)(9)(B). The inclusion of a singular “list” to govern “this subsection” seems, most naturally, to refer to the list contemplated by section 7412(c)(1), which states that the EPA “shall publish, and shall from time to time . . . revise . . . a list of all categories and subcategories of . . . area sources (listed under paragraph (3)).” Id. § 7412(c)(1) (emphasis added). In other words, it appears that section 7412(c)(1) directs the EPA to create one “list” of source categories and subcategories to subject to emission controls and section 113 7412(c)(9) instructs how to remove source categories from that list. This conclusion finds support in section 7412(c)(1)’s cross reference to “paragraph (3)” of section 7412(c), which lays out the circumstances under which the EPA “shall list” area source categories for emissions control. Id. § 7412(c)(3). In the Environmental Petitioners’ view, section 7412(c)(9) also applies to a second, subsidiary list—that contemplated by section 7412(c)(6), requiring imposition of the MACT standard. Granted, section 7412(c)(6) mandates that the EPA “shall . . . list” source categories and subcategories if doing so is necessary to control 90 per cent of the aggregate emissions from seven enumerated pollutants. Id. § 7412(c)(6) (emphasis added). But the use of the verb “list” in section 7412(c)(6) does not unambiguously establish that 7412(c)(9), titled “[d]eletions from the list,” applies. Because section 7412(c)(9) is ambiguous, we defer to the EPA so long as its interpretation is “based on a permissible construction.” Chevron, 467 U.S. at 842-43. And the EPA’s reading of section 7412(c)(9)—that it applies only if the EPA wants to remove a category from all section 7412 regulation—is reasonable. First, the EPA’s approach harmonizes sections 7412(c)(1), 7412(c)(3), and 7412(c)(9). Because the EPA must find that an area source “presents a threat of adverse effects to human health or the environment” before it regulates the source category at all, id. § 7412(c)(3), it makes sense to require the EPA to find that “no source in the category or subcategory . . . exceed[s] a level which is adequate to protect public health . . . and no adverse environmental effect will result from emissions from any source” before it completely deregulates that category, id. § 7412(c)(9). It makes less sense to require the EPA to make 114 the same findings before it opts for GACT instead of MACT standards, which occurs when the EPA removes a source from section 7412(c)(6)’s purview but continues to regulate it under section 7412(c)(1). Second, the EPA’s approach is consistent with our decision in New Jersey, 517 F.3d 574. There, we held that “the only way EPA could remove [a source category] from the section [7412(c)(1)] list was by satisfying section [7412(c)(9)’s] requirements.” Id. at 582. In other words, New Jersey held that the EPA cannot remove a source category from all section 7412 regulation without delisting it; it said nothing about the process by which the EPA moves source categories from section 7412(c)(6). Finally, the Petitioners’ argument would freeze the EPA’s decision as to which sources need to be controlled to reach the requisite 90 per cent emissions reduction for the section 7412(c)(6) pollutants until it determines that “no source in the category or subcategory . . . exceed[s] a level which is adequate to protect public health . . . and no adverse environmental effect will result from emissions from any source.” 42 U.S.C. § 7412(c)(9). This, in turn, would hamper the EPA’s ability to respond to updated data, thereby substantially complicating its attempts to control the pollutants. Nothing in the CAA suggests that the Congress intended to so hamstring the Agency.
The EPA has discretion to exempt one or more area source categories from Title V permitting requirements upon a finding “that compliance with such requirements is impracticable, infeasible, or unnecessarily burdensome on such categories.” 42 U.S.C. § 7661a(a). The EPA originally 115 proposed exempting some area source categories because existing “testing, monitoring, notification, and recordkeeping requirements” rendered Title V permitting cumulative. 2010 Proposed Area Boilers Rule, 75 Fed. Reg. at 31,910. At the time, however, the EPA elected not to exempt synthetic area sources as one of those categories. Id. at 31,913. Synthetic area sources are boilers that “naturally” emit pollutants at a major source level but which qualify as area sources due to the voluntary adoption of air pollution control technologies. Id. Despite its initial stance, the EPA ultimately decided to exempt all area sources—including synthetic area sources— from Title V’s permitting requirements. See 2011 Area Boilers Rule, 76 Fed. Reg. at 15,578. Environmental Petitioners argue the EPA’s decision to exclude synthetic boilers from Title V licensing requirements is arbitrary and capricious for two reasons. First, they say, the EPA arbitrarily concluded synthetic area sources would bear the same level of burden as other area sources in complying with Title V permitting requirements, rather than a lesser one. See No. 11-1141 Envtl. Pet’rs’ Br. 39-43. And second, they contend the EPA arbitrarily dismissed the additional compliance benefits of Title V licensing for these synthetic sources. See id. at 43-47. Under State Farm, “an agency rule [is] arbitrary and capricious if the agency . . . offered an explanation of its decision that runs counter to the evidence before the agency.” 463 U.S. at 43. A court may not accept an agency’s “post hoc rationalizations” for its decisionmaking. Id. at 49. The EPA has authority under the CAA to exempt sources from Title V permitting requirements if those requirements would be “impracticable, infeasible, or unnecessarily burdensome” on the area source. 42 U.S.C. § 7661a(a). The 116 EPA previously developed a four-factor balancing test to determine whether Title V’s requirements are “unnecessarily burdensome.” See Exemption of Certain Area Sources from Title V Operating Permit Programs, 70 Fed. Reg. 75,320, 75,323 (Dec. 19, 2005). Under this test, the EPA considers whether: (1) Title V permitting would result in significant improvements in compliance with emission standards; (2) whether Title V permitting would impose significant burdens on the area source category; (3) whether the costs are justified, taking into account potential gains; and (4) whether there are existing enforcement programs in place sufficient to ensure compliance. See id. at 75,323-26. The EPA also must consider, consistent with the legislative history of the CAA, whether exemption would “adversely affect public health, welfare, or the environment.” Id. at 75,333-34. These factors are considered in combination and not every factor must point in favor of exemption for the EPA to choose that course. See id. at 75,323. In its 2010 Proposed Area Boilers Rule, the EPA applied this balancing test and excluded almost all area source boilers except synthetic boilers that achieved “area” status via installation of a control technology (although it exempted those that achieved “area” status through operational changes). The EPA provided an extensive rationale for its decision to exclude these “natural” area sources from Title V’s permitting requirements. See 2010 Proposed Area Boilers Rule, 75 Fed. Reg. at 31,910-13. With respect to factor one, the EPA found its proposed rule already required “direct monitoring of emissions,” both continuously and periodically, recordkeeping that would allow for additional monitoring, and “semi-annual reporting to assure compliance.” Id. at 31,911. Moreover, under the proposed rule, “records are required to be maintained in a form suitable 117 and readily available for expeditious review” for up to five years. Id. The EPA acknowledged Title V permitting could provide some additional compliance benefits; specifically, that Title V has an every-six-month monitoring and reporting requirement. See id. But the EPA ultimately concluded the monitoring, recordkeeping, and reporting requirements of its proposed rule were sufficient to assure compliance: “Given the nature of the operations at most area sources and the types of requirements in this rule, Title V would not significantly improve those compliance requirements.” Id. As to the second factor, the EPA noted that subjecting most area sources to Title V would “impose[] certain burdens and costs that do not exist outside of the [t]itle V program.” Id. at 31,912. One of the EPA’s major concerns was that “requiring permits for the large number of area sources could, at least in the first few years of implementation, potentially adversely affect public health, welfare, or the environment by shifting [s]tate agencies[’] resources away from assuring compliance for major sources with existing permits to issuing new permits for these area sources, potentially reducing overall air program effectiveness.” Id. at 31,913. For the third factor, the EPA concluded the costs of compliance would “impose a significant burden on many of the approximately 137,000 facilities affected by this proposed rule” with only “low” potential gains in compliance. Id. at 31,912. Finally, for the fourth factor, the EPA determined that “[s]tate delegated programs are sufficient to assure compliance with this [rule],” and noted that the Agency retains authority to enforce this rule “anytime.” Id. The EPA therefore proposed exempting these area sources from the permitting requirements. See id. Environmental Petitioners are not currently challenging the exemption for non-synthetic area boilers. 118 However, in this 2010 rulemaking, the EPA also explained precisely why it declined to exempt synthetic area sources that installed air pollution controls from Title V requirements. First, the EPA noted these synthetic area sources “represent less than one percent of the total number of sources that will be subject to the final rule.” Id. at 31,913. The EPA also characterized these sources as “much more like the major sources” that are not exempt from Title V permitting requirements. Id. Further distinctions included that “many of these sources are located in cities, and often in close proximity to residential and commercial centers where large numbers of people live and work,” that they “have significantly higher emissions potential when uncontrolled” (even compared to synthetic boilers that adopted operational limits to attain area source status), and that many of these sources “are large facilities with comprehensive compliance programs in place” as opposed to small facilities, like schools or hospitals. Id. Given these distinctions, the EPA concluded additional public involvement and compliance oversight through Title V was “important to ensure that these sources are maintaining their emissions at the area source level.” Id. But the EPA shifted its position in the 2011 Area Boilers Rule by deciding to exempt all area sources, including synthetic sources. See 76 Fed. Reg. at 15,578. The EPA provided only a cursory explanation for this shift, noting how a further review of the record led it to conclude “observations and data we have relied upon in other rulemakings for distinguishing between sources that became synthetic area sources due to controls and other synthetic and natural area sources [do] not necessarily apply to this source category.” Id. (emphasis added). Because the EPA asserted it no longer had “sufficient information” to identify control-technologydependent synthetic sources, it decided to apply the same 119 rationale used to exempt “natural” sources to these synthetic sources. Id. (“[T]he rationale for exempting most area sources subject to this rule . . . is also now relevant for sources which we proposed to permit [under Title V].”). But—even if the EPA truly cannot distinguish between synthetic sources relying on control technologies and other sources—it does not invariably follow that the justifications the Agency relied on for exempting “natural” sources under the four-factor balancing test can be transposed onto these synthetic sources. Cf. Sierra Club II, 479 F.3d at 884 (“We agree with the Sierra Club that EPA’s use of work practice standards instead of emission floors violates section 7412(h). That provision allows EPA to substitute work practice standards for emission floors only if measuring emissions levels is technologically or economically impracticable. Here, EPA never determined that measuring emissions from ceramic kilns was impracticable; it determined only that it lacked emissions data from ceramics kilns. EPA thus had no basis under section 7412(h) for using work practice standards.”). In its next iteration of the rule, the EPA endeavored to further explain its exemption of synthetic sources. The EPA again stated it “lacked sufficient information” to distinguish these synthetic sources from other area sources. See 2011 Proposed Area Boilers Rule on Reconsideration, 76 Fed. Reg. at 80,538. The Sierra Club challenged this exemption in a comment, and the EPA responded with “additional analysis” of the synthetic exemption. Id. In this analysis, the EPA first reiterated the difference in number between the two types: estimating there to be at least 48 control-technologydependent synthetic sources versus 137,000 other area sources, most of which are located at small facilities like schools, hospitals, and churches. See id. The EPA then provided a new rationale for the exemption: that these 120 synthetic facilities “may already have a Title V permit for other reasons.” Id. The EPA also found that “synthetic area sources would likely be subject to more stringent permit and monitoring requirements than natural area sources” because they have a “legal duty to use the control equipment” to keep them at an “area” level. Id. (emphasis added). Finally, the EPA made several assertions about the similarities between synthetic and natural sources. Specifically, that synthetic sources are “similar in size and sophistication to those that are natural area sources,” that their “uncontrolled emissions are generally on the same order of magnitude as the emissions of natural sources,” and that “the facilities and owners are comparable in size.” Id. The EPA provided no data or examples in support of these assertions, which appear to directly contradict the distinctions the EPA listed in its earlier version of the rule. Compare id., with 2010 Proposed Area Boilers Rule, 75 Fed. Reg. at 31,913. In its final rule, the EPA declined to make any changes to its Title V exemptions—exempting all area sources including synthetic sources using a control technology. See 2013 Area Boilers Rule, 78 Fed. Reg. at 7,497. Based on this record, the EPA’s reasoning has several fatal flaws that render its exemption decision arbitrary. The EPA put forward two primary justifications for exempting synthetic sources: (1) that it could not necessarily rely on existing data for distinguishing the different type of sources, and (2) that these facilities are “similar in size and sophistication” to natural area sources. See 2011 Proposed Area Boilers Rule on Reconsideration, 76 Fed. Reg. at 80,538. The second justification flatly contradicts the EPA’s earlier, extensive discussion about how these synthetic sources have higher emissions potential and are often located on large sites with existing compliance programs, in addition 121 to being uniquely few in number and generally found near cities. 2010 Proposed Area Boilers Rule, 75 Fed. Reg. at 31,912-13. These factors all undercut the EPA’s assertion that synthetic sources are “similar”—in size, sophistication, or otherwise—to natural sources. With respect to the lack of data for distinguishing, the EPA was able to estimate in its proposed rule that 48 synthetic sources would have been affected by this rule—which suggests the EPA possesses some mechanism for distinguishing the types. See 2011 Proposed Area Boilers Rule on Reconsideration, 76 Fed. Reg. at 80,538. Moreover, the EPA does not explain why the data it used in prior rulemakings to distinguish these source types is not accurate in this context. Environmental Petitioners also point out that, “to qualify for area-source status, synthetic area sources must notify the EPA or the state permitting authority of the limits on their emissions,” such that the EPA “need only ask these authorities to identify the sources operating in their states.” No. 11-1141, Envtl. Pet’rs’ Br. 39-40. The EPA never endeavors to explain why that mechanism (or any other existing mechanism) is insufficient for identifying synthetic area sources. Because its justifications for the final rule contradict earlier findings, the EPA must provide some reasoning to explain why its final decision “runs counter to the evidence before the agency.” State Farm, 463 U.S. at 43. The EPA’s proffered explanation fails. This court has “often declined to affirm an agency decision if there are unexplained inconsistencies in the final rule.” See Dist. Hosp. Partners, 786 F.3d at 59; see also Gulf Power Co. v. FERC, 983 F.2d 1095, 1101 (D.C. Cir. 1993) (“[W]hen an agency takes inconsistent positions . . . it must explain its reasoning.”); Gen. Chem. Corp. v. United States, 817 F.2d 844, 846 (D.C. Cir. 1987) (holding agency action to be arbitrary because its 122 analysis was “internally inconsistent and inadequately explained”). The EPA had a duty here to examine and justify the “key assumptions” underlying its decision, and it failed to do so. See Appalachian Power Co. v. EPA, 135 F.3d 791, 818 (D.C. Cir. 1998) (“EPA retains a duty to examine key assumptions as part of its affirmative burden of promulgating and explaining a nonarbitrary, non-capricious rule.” (internal quotation marks omitted)). The EPA’s major oversight was its failure to explain why the rationale it used to exempt natural area sources from Title V could be identically applied to synthetic area sources. One of the Agency’s main justifications for exempting natural area sources was that their prolific numbers might overwhelm state and local regulatory agencies, diverting resources from other important environmental programs, thereby harming public health and welfare. The EPA never explained why requiring 48 synthetic area sources to comply with Title V would strain government resources to a comparable degree as would requiring the 137,000 natural area sources to comply. As discussed above, the EPA also did not explain how it suddenly determined these synthetic area sources were “similar in size and sophistication” to natural sources, when it had previously articulated several key differences. It is particularly unclear how these synthetic sources could have “uncontrolled emissions . . . generally on the same order of magnitude as the emissions of natural area sources.” 2011 Proposed Area Boilers Rule on Reconsideration, 76 Fed. Reg. at 80,538. Given that synthetic sources are defined as “major” sources that have artificially reduced their emissions to an “area” level, it is difficult to understand how the uncontrolled emissions of these sources would be similar to natural area sources. Additionally, the EPA asserted that synthetic source “facilities and owners are comparable in 123 size” to natural sources. Id. This contradicts earlier findings that synthetic sources tend to be large, located on sites with existing compliance plans, and near population-dense areas. The EPA provides no data or explanation to support this shift. The EPA relies on another problematic premise when it claims the potential benefits of subjecting synthetic area sources to Title V requirements are low. Both the EPA and Industry Intervenors argue that the added benefits of Title V would be minimal for these synthetic sources, relying solely on the rationale given for natural sources. But the EPA originally asserted “additional public involvement and compliance assurance requirements through title V [are] important to ensure that these sources are maintaining their emissions at the area source level.” 2010 Proposed Area Boilers Rule, 75 Fed. Reg. at 31,913 (emphasis added). The EPA never explains why these additional benefits were considered “important” before but are now “not important” simply because it allegedly determined that synthetic sources may be hard to distinguish from natural sources. The difficulty in identifying synthetic sources says nothing about the benefits that may be gained by requiring Title V permits, assuming the sources can be identified. Synthetic sources retain the attributes which first motivated the EPA to subject them to Title V permitting: they tend to be near cities, specifically near large residential populations, and they have greater emission potential if their control technology is removed, turned off, or not kept up to standards. The EPA arguably finds Title V’s additional compliance benefits unnecessary because synthetic sources have “a legal duty to use the control equipment” and that use is “not optional.” 2011 Proposed Area Boilers Rule on Reconsideration, 76 Fed. Reg. at 80,538. But that observation does not speak to the need for public oversight; just because facilities are obligated 124 to use the control technology does not mean they will always do so. Title V’s process requires facilities to submit compliance documentation every six months—far more frequently than under the EPA’s current rule—which expands the opportunity for public oversight and compliance. Perhaps this “legal duty” provides a stronger incentive for compliance than public oversight but, if so, the EPA still fails to explain how. Similarly, for factor three’s balancing of costs and benefits, the EPA never justifies applying to natural sources— which tend to be small sites like schools, hospitals, and churches—the same rationale it applies to these larger synthetic sources, which tend to be located at refineries, chemical plants, and factories. Given these distinctions, it is at least possible this balancing would lead to a different outcome for synthetic sources. Taken as a whole, the EPA’s analysis fails to explain why several of the facts and characteristics it relied on for its initial assessment are no longer relevant—creating several glaring inconsistencies in the rulemaking record. The EPA offers no plausible reason for applying the results of the four-factor test for natural sources wholesale to these control-technology-dependent synthetic sources. We do not hold, however, that the EPA can never remove synthetic area sources from the ambit of Title V compliance. The outcome the EPA ultimately reached may be reasonable; however, “[n]ot only must an agency’s decreed result be within the scope of its lawful authority, but the process by which it reaches that result must be logical and rational.” Allentown Mack Sales & Serv., Inc. v. NLRB, 522 U.S. 359, 374 (1998). The EPA should have applied its fourfactor balancing test directly to synthetic sources or, at a minimum, provided an explanation for adopting the natural 125 source balancing test that is not premised on inconsistencies in the record. With respect to remedy, there is a strong possibility that the Agency can properly explain its decision to exclude synthetic boilers from the Title V permitting requirement; moreover, vacating the decision would be unnecessarily disruptive for synthetic boiler operators who, in the interim, would not know whether they needed to begin the expensive, time-consuming process of obtaining a Title V permit. See Allied-Signal, Inc. v. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 150-51 (D.C. Cir. 1993). We therefore remand this issue (without vacating) for further explanation by the EPA.
With few exceptions, the EPA has broad discretion to choose how to control area source emissions. For instance, the EPA has discretion to choose between GACT and MACT standards in the majority of cases. See 42 U.S.C. § 7412(d)(5). Even if the EPA chooses a MACT standard, it has discretion—although somewhat circumscribed—to set a work-practice standard instead of a numeric standard. Id. § 7412(h)(1). And the EPA has discretion when choosing among different GACT-standard options. See id. § 7412(d)(5). Accordingly, we must uphold the EPA’s GACT-standard determinations so long as it “has considered the relevant factors and articulated a rational connection between the facts found and the choice made, and has not relied on [improper] factors.” Nat’l Ass’n of Clean Air Agencies, 489 F.3d at 1228 (citations and internal quotation marks omitted). But for all of the discretion the EPA enjoys, it must nonetheless demonstrate that it exercised its judgment in a reasoned way. 126 The cases establishing this principle are legion. See, e.g., Transactive Corp. v. United States, 91 F.3d 232, 236 (D.C. Cir. 1996) (agency must “identif[y] and explain[] the reasoned basis for its decision”); Int’l Fabricare Inst., 972 F.2d at 389 (agency must “examine[] the relevant data and . . . articulate[] an adequate explanation for its action”). The EPA need not go to great lengths to meet its burden; indeed, we “uphold a decision of less than ideal clarity” so long as “the agency’s path may reasonably be discerned.” State Farm, 463 U.S. at 43 (quoting Ark.-Best Freight Sys., Inc., 419 U.S. at 286). With these principles in mind, we address the Environmental Petitioners’ two challenges to the EPA’s discretionary decisions regarding the Area Boilers Rule.
for Non-Hg Metals The Environmental Petitioners argue that the EPA failed to support its decision-making when it established MACT standards for Hg and POM emissions from some coal-fired boilers but declined to regulate non-Hg emissions under the MACT standard from the same boilers. We agree. Although the EPA thoroughly explained why it chose to impose one GACT standard instead of another, nothing in the record explains why the EPA decided to impose GACT standards instead of MACT standards in the first place. Despite the Agency’s broad discretion, we cannot sustain its action in the absence of some explanation for why GACT standards are more appropriate than MACT standards for these sources and types of pollutants. See Transactive Corp., 91 F.3d at 236. For this reason, we remand (but do not vacate) the EPA’s choice of GACT standards for non-Hg emissions from coal127 fired boilers. See Sierra Club, 167 F.3d at 664; Nat’l Lime Ass’n, 233 F.3d at 634-35.
The Environmental Petitioners also challenge several of the EPA’s choices among different GACT standards. As noted, see supra § I.A.1.c, the CAA provides virtually no instruction regarding GACT standards but the standards generally take the form of “methods, practices and techniques which are commercially available and appropriate for application by the sources in the category considering economic impacts and the technical capabilities of the firms to operate and maintain the emissions control systems.” S. REP. NO. 101-228, at 171 (1989). Because the EPA has ample discretion to choose the appropriate GACT standard, we will affirm its choices so long as we can discern reasoned decision-making from the record. State Farm, 463 U.S. at 43. For the reasons set forth below, we can do so here and, accordingly, we reject the Environmental Petitioners’ GACTfocused challenges. First, the Environmental Petitioners challenge the data set the EPA used to arrive at the numeric GACT standards for non-Hg-metal emissions from coal-fired boilers. Specifically, they contend that the EPA set the GACT limit based on boilers with no control technology, which resulted in a numeric standard of 0.42 lb/mmBtu. They insist that the EPA should instead have examined boilers outfitted with fabric filters, which would have resulted in a numeric standard of 0.03 lb/mmBtu. The EPA, however, thoroughly explained why it considered the uncontrolled boiler data set. Specifically, the controlled data set derives from the EPA’s “New Source Performance Standards” (NSPS) data, which, in 128 the Agency’s view, could be used to set the non-Hg-metal GACT standard for boilers with a heat input capacity of 30 mmBtu/hr or greater but did not suffice for boilers with a lower heat input capacity. For this reason, the EPA examined its original data set, found that none of the coal-fired boilers in that set used control technology and, accordingly, set the GACT numeric standard at the emissions level achieved by the best performing uncontrolled source in that data set (i.e., 0.42 lb/mmBtu). We are satisfied that the EPA exercised its discretion in a reasoned manner and, accordingly, we do not disturb it. See Transactive Corp., 91 F.3d at 236. Next, the Environmental Petitioners challenge the EPA’s decision to establish a tune-up requirement as a GACT management-practice standard for Hg and POM emissions from large biomass-fired and oil-fired boilers. In their view, other, more restrictive control technologies, including multiclones,38 are “generally available” and their availability mandates that the EPA set numeric standards based on boilers that use those controls. But the EPA explained its approach: A boiler tune-up requirement would potentially result in the same non-mercury metallic HAP reduction as a PM emission limit based on performance of multiclones but would also reduce emissions of organic HAP. In addition the cost of a boiler tune-up appears minimal compared to the cost for testing and 38 A multiclone is a PM “mechanical separator[].” See 2010 Proposed Area Boilers Rule, 75 Fed. Reg. at 31,908. It diverts particles from the exhaust stream by creating a circular air flow. See id. 129 monitoring to demonstrate compliance with an emission limit. See 2010 Proposed Area Boilers Rule, 75 Fed. Reg. at 31,908. The EPA also explained that multiclones were “minimally effective” for controlling non-Hg metals, ineffective for POM and Hg, and expensive. Id. Because the EPA’s decision to impose a tune-up requirement fits within its “technical expertise,” we owe the Agency an “extreme degree of deference” so long as its explanation is rational. Catawba Cty., N.C. v. EPA, 571 F.3d 20, 41 (D.C. Cir. 2009) (quoting City of Waukesha v. EPA, 320 F.3d 228, 247 (D.C. Cir. 2003)). And because its explanation was rational, we reject the Petitioners’ challenge thereto. Finally, the Petitioners challenge the EPA’s decision to set a tune-up requirement as a management-practice standard for small biomass-fired and oil-fired area boilers. The EPA adopted this approach because measuring PM emissions for smaller boilers is “not feasible.” 2010 Proposed Area Boilers Rule, 75 Fed. Reg. at 31,906. When the EPA explained its decision regarding small biomass-fired and oil-fired area boilers, it provided the same reasons it gave for its use of a tune-up requirement for small coal-fired area boilers, which we address (and uphold), infra, § IV.M. For those reasons, we reject the challenge to the EPA’s tune-up requirement for small biomass-fired and oil-fired area boilers.