Opinion ID: 4020089
Heading Depth: 2
Heading Rank: 4

Heading: beyond-the-floor standards for ciswi units

Text: 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.