Opinion ID: 796659
Heading Depth: 4
Heading Rank: 2

Heading: Cost Analysis Pursuant to Section 316(b)

Text: 53 As already noted, section 316(b) does not itself set forth the factors that the Agency can consider in determining the best technology available for minimizing adverse environmental impact. The BTA standard of section 316(b), however, is linguistically similar to the BAT standard of section 301 and the standard that applies to new sources under section 306, and to the extent that cost-benefit analysis is precluded under those statutes, one might reasonably conclude that it is similarly not permitted under section 316(b). We conclude in any event that the language of section 316(b) itself plainly indicates that facilities must adopt the best technology available and that cost-benefit analysis cannot be justified in light of Congress's directive. 54 We stated in Riverkeeper I that the EPA can consider cost in establishing BTA, but only in a limited fashion and not as a primary consideration. Indeed, [w]ith respect to costs, `the Administrator must inquire into the initial and annual costs of applying the technology and make an affirmative determination that those costs can be reasonably borne by the industry.' Riverkeeper I, 358 F.3d at 195 (quoting Chem. Mfrs. Ass'n v. EPA, 870 F.2d 177, 262 (5th Cir.1989)) (emphasis added). While the statutory language suggests that the EPA may consider costs in determining BTA, in that a technology that cannot be reasonably borne by the industry is not available in any meaningful sense, cost-benefit analysis is not similarly supported by the language or purpose of the statute. Section 316(b) expressly requires a technology-driven result, cf. Natural Res. Def. Council, Inc. v. EPA, 822 F.2d 104, 123 (D.C.Cir.1987) ([T]he most salient characteristic of [the CWA's] statutory scheme, articulated time and again by its architects and embedded in the statutory language, is that it is technology-forcing.), not one driven by cost considerations or an assessment of the desirability of reducing adverse environmental impacts in light of the cost of doing so. A selection of BTA based on cost-benefit considerations is thus impermissibly cost-driven, but a selection based in part on cost-effectiveness considerations, while taking cost into account, remains technology-driven. The statute therefore precludes cost-benefit analysis because Congress itself defined the basic relationship between costs and benefits. Am. Textile Mfrs. Inst., Inc. v. Donovan, 452 U.S. 490, 509, 101 S.Ct. 2478, 69 L.Ed.2d 185 (1981). Moreover, this conclusion is further supported by the fact that Congress in establishing BTA did not expressly permit the Agency to consider the relationship of a technology's cost to the level of reduction of adverse environmental impact it produces. 11 When Congress has intended that an agency engage in cost-benefit analysis, it has clearly indicated such intent on the face of the statute. Id. at 510, 101 S.Ct. 2478. 55 Given the above, the EPA may permissibly consider cost in two ways: (1) to determine what technology can be reasonably borne by the industry and (2) to engage in cost-effectiveness analysis in determining BTA. Thus, the EPA must first determine what is the most effective technology that may reasonably be borne by the industry. In making this initial determination, the most effective technology must be based not on the average Phase II facility but on the optimally best performing Phase II facilities, see, e.g., Kennecott v. United States EPA, 780 F.2d 445, 448 (4th Cir.1985) (In setting BAT, EPA uses not the average plant, but the optimally operating plant, the pilot plant which acts as a beacon to show what is possible.), although, of course, the EPA must still ascertain whether the industry as a whole can reasonably bear the cost of the adoption of the technology, bearing in mind the aspirational and technology-forcing character of the CWA. This technology constitutes the benchmark for performance. Once this determination has been made, the EPA may then consider other factors, including cost-effectiveness, to choose a less expensive technology that achieves essentially the same results as the benchmark. 12 For example, assuming the EPA has determined that power plants governed by the Phase II Rule can reasonably bear the price of technology that saves between 100-105 fish, the EPA, given a choice between a technology that costs $100 to save 99-101 fish and one that costs $150 to save 100-103 fish (with all other considerations, like energy production or efficiency, being equal), could appropriately choose the cheaper technology on cost-effectiveness grounds. Cost-benefit analysis, however, is not permitted under the statute because, as noted, Congress has already specified the relationship between cost and benefits in requiring that the technology designated by the EPA be the best available. 13 Cf. Am. Textile Mfrs. Inst., 452 U.S. at 509-10, 101 S.Ct. 2478. The Agency accordingly could not make the policy decision, in the face of Congress's determination that facilities use the best technology available, that an economically feasible level of reduction of impingement mortality and entrainment is not desirable in light of its cost. Indeed, in the example above, the EPA could not choose the cheaper technology on cost considerations under section 316(b) if the EPA had first determined that the power plants could reasonably bear the cost of technology that could save at least 102 fish. 56 We nevertheless acknowledge that the comparable technologies considered by the Agency need not be identically effective for the Agency to engage in cost-effectiveness analysis. Were that the case, all that would be required would be the simple determination of which among competing technologies that achieved the same degree of reduction of adverse environmental impacts is the cheapest. Instead, the specified level of benefit is more properly understood as a narrowly bounded range, within which the EPA may permissibly choose between two (or more) technologies that produce essentially the same benefits but have markedly different costs. With these considerations in mind, we turn to the Rule as promulgated. 57