Court Opinion

ID: 4194078
Source: CourtListenerOpinion
Date Created: 2017-08-08 15:01:38.288113+00
Date Added: 2024-06-11T14:39:54.430546
License: Public Domain

United States Court of Appeals
         FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 17, 2017             Decided August 8, 2017

                       No. 15-1328

                  MEXICHEM FLUOR, INC.,
                       PETITIONER

                             v.

          ENVIRONMENTAL PROTECTION AGENCY,
                    RESPONDENT

        THE CHEMOURS COMPANY FC, LLC, ET AL.,
                   INTERVENORS

                Consolidated with 15-1329

      On Petitions for Review of Final Action by the
      United States Environmental Protection Agency

    Dan Himmelfarb argued the cause for petitioners. With
him on the joint briefs were John S. Hahn, Roger W. Patrick,
Matthew A. Waring, William J. Hamel, W. Caffey Norman, T.
Michael Guiffré, and Kristina V. Foehrkolb.

     Dustin J. Maghamfar, Attorney, U.S. Department of
Justice, argued the cause for respondent. On the brief were
John C. Cruden, Assistant Attorney General, Elizabeth B.
Dawson, Attorney, U.S. Department of Justice, and Jan
                               2
Tierney and Diane McConkey, Attorneys, U.S. Environmental
Protection Agency.

     Thomas A. Lorenzen argued the cause for intervenors The
Chemours Company FC, LLC, and Honeywell International
Inc. in support of respondent. With him on the brief were
Robert J. Meyers, Sherrie A. Armstrong, Jonathan S. Martel,
and Eric A. Rey.

    David Doniger, Benjamin Longstreth, Melissa J. Lynch,
and Emily K. Davis were on the brief for intervenor Natural
Resources Defense Council in support of respondent.

    Before: BROWN, KAVANAUGH, and WILKINS, Circuit
Judges.

    Opinion for the Court filed by Circuit Judge KAVANAUGH,
with whom Circuit Judge BROWN joins, and with whom Circuit
Judge WILKINS joins as to Part I and Part III.

    Opinion concurring in part and dissenting in part filed by
Circuit Judge WILKINS.

     KAVANAUGH, Circuit Judge: The separation of powers
and statutory interpretation issue that arises again and again in
this Court is whether an executive or independent agency has
statutory authority from Congress to issue a particular
regulation. In this case, we consider whether EPA had
statutory authority to issue a 2015 Rule regulating the use of
hydrofluorocarbons, known as HFCs.

     According to EPA, emissions of HFCs contribute to
climate change. In 2015, EPA therefore issued a rule that
restricted manufacturers from making certain products that
contain HFCs. HFCs have long been used in a variety of
                               3
familiar products – in particular, in aerosol spray cans, motor
vehicle air conditioners, commercial refrigerators, and foams.
But as a result of the 2015 Rule, some of the manufacturers that
previously used HFCs in their products no longer may do so.
Instead, those manufacturers must use other EPA-approved
substances in their products.

    As statutory authority for the 2015 Rule, EPA has relied
on Section 612 of the Clean Air Act. 42 U.S.C. § 7671k.
Section 612 requires manufacturers to replace ozone-depleting
substances with safe substitutes.

    The fundamental problem for EPA is that HFCs are not
ozone-depleting substances, as all parties agree. Because
HFCs are not ozone-depleting substances, Section 612 would
not seem to grant EPA authority to require replacement of
HFCs. Indeed, before 2015, EPA itself maintained that Section
612 did not grant authority to require replacement of non-
ozone-depleting substances such as HFCs. But in the 2015
Rule, for the first time since Section 612 was enacted in 1990,
EPA required manufacturers to replace non-ozone-depleting
substances (HFCs) that had previously been deemed acceptable
by the agency. In particular, EPA concluded that some HFCs
could no longer be used by manufacturers in certain products,
even if the manufacturers had long since replaced ozone-
depleting substances with HFCs.

     EPA’s novel reading of Section 612 is inconsistent with
the statute as written. Section 612 does not require (or give
EPA authority to require) manufacturers to replace non-ozone-
depleting substances such as HFCs. We therefore vacate the
2015 Rule to the extent it requires manufacturers to replace
HFCs, and we remand to EPA for further proceedings
consistent with this opinion.
                               4
                               I

                               A

     In the 1980s, an international movement developed to
combat depletion of the ozone layer. Depletion of the ozone
layer exposes people to more of the sun’s harmful ultraviolet
light, thereby increasing the incidence of skin cancer, among
other harms. The international efforts to address ozone
depletion culminated in the Montreal Protocol, an international
agreement signed in 1987 by the United States and
subsequently ratified by every nation in the United Nations.
The Protocol requires signatory nations to regulate the
production and use of a variety of ozone-depleting substances.
Montreal Protocol on Substances that Deplete the Ozone
Layer, opened for signature Sept. 16, 1987, S. Treaty Doc. No.
100-10, 1522 U.N.T.S. 29.

     Congress implemented U.S. obligations under the
Montreal Protocol by enacting, with President George H.W.
Bush’s signature, the 1990 Amendments to the Clean Air Act.
Those amendments added a new Title VI to the Clean Air Act.
Title VI regulates ozone-depleting substances.

     Title VI identifies two classes of ozone-depleting
substances: “class I” and “class II” substances. 42 U.S.C.
§ 7671a(a), (b). Section 612(a), one of the key provisions of
Title VI, requires manufacturers to replace those ozone-
depleting substances: “To the maximum extent practicable,
class I and class II substances shall be replaced by chemicals,
product substitutes, or alternative manufacturing processes that
reduce overall risks to human health and the environment.” Id.
§ 7671k(a). With a few exceptions, Title VI requires
manufacturers to phase out their use of some ozone-depleting
                               5
substances by 2000, and to phase out their use of other ozone-
depleting substances by 2015. Id. §§ 7671c(b)-(c), 7671d(a).

     When manufacturers stop using ozone-depleting
substances in their products, manufacturers may need to
replace those substances with a substitute substance. Under
Section 612(a), EPA may require manufacturers to use safe
substitutes when the manufacturers replace ozone-depleting
substances. Id. § 7671k(a).

    To implement the Section 612(a) requirement that ozone-
depleting substances be replaced with safe substitutes, Section
612(c) requires EPA to publish a list of both safe and prohibited
substitutes:

    Within 2 years after November 15, 1990, the
    Administrator shall promulgate rules under this section
    providing that it shall be unlawful to replace any class I or
    class II substance with any substitute substance which the
    Administrator determines may present adverse effects to
    human health or the environment, where the Administrator
    has identified an alternative to such replacement that –

         (1) reduces the overall risk to human health and the
             environment; and
         (2) is currently or potentially available.

    The Administrator shall publish a list of (A) the substitutes
    prohibited under this subsection for specific uses and
    (B) the safe alternatives identified under this subsection
    for specific uses.

Id. § 7671k(c). In short, Section 612(c) requires EPA to issue
a list of both authorized and prohibited substitute substances
based on the safety and availability of the substances.
                               6

     Importantly, the lists of safe substitutes and prohibited
substitutes are not set in stone. Section 612(d) provides: “Any
person may petition the Administrator to add a substance to the
lists under subsection (c) of this section or to remove a
substance from either of such lists.” Id. § 7671k(d). In other
words, if EPA places a substance on the list of safe substitutes,
EPA may later change its classification and move the substance
to the list of prohibited substitutes (or vice versa).

     In 1994, EPA promulgated regulations to implement
Section 612(c). See Protection of Stratospheric Ozone, 59 Fed.
Reg. 13,044 (Mar. 18, 1994). At the time, EPA indicated that
once a manufacturer has replaced its ozone-depleting
substances with a non-ozone-depleting substitute, Section
612(c) does not give EPA authority to require the manufacturer
to later replace that substitute with a different substitute. EPA
explained that Section 612(c) “does not authorize EPA to
review substitutes for substances that are not themselves”
ozone-depleting substances covered under Title VI. EPA
Response to Comments on 1994 Significant New Alternatives
Policy Rule, J.A. 50.

                               B

    Hydrofluorocarbons, known as HFCs, are substances that
contain hydrogen, fluorine, and carbon. When HFCs are
emitted, they trap heat in the atmosphere. They are therefore
“greenhouse gases.” But HFCs do not deplete the ozone layer.
As a result, HFCs are not ozone-depleting substances covered
by Title VI of the Clean Air Act. Instead, HFCs are potential
substitutes for ozone-depleting substances in certain products.

    In 1994, acting pursuant to its authority under Section
612(c), EPA concluded that certain HFCs were safe substitutes
                               7
for ozone-depleting substances when used in aerosols, motor
vehicle air conditioners, commercial refrigerators, and foams,
among other things. See Protection of Stratospheric Ozone, 59
Fed. Reg. at 13,122-46. Over the next decade, EPA added
HFCs to the list of safe substitutes for a number of other
products. See, e.g., Protection of Stratospheric Ozone: Listing
of Substitutes for Ozone-Depleting Substances, 68 Fed. Reg.
4004, 4005 (Jan. 27, 2003); Protection of Stratospheric Ozone;
Listing of Substitutes for Ozone-Depleting Substances, 64 Fed.
Reg. 22,982, 22,984 (Apr. 28, 1999).

     As a result, in the 1990s and 2000s, many businesses
stopped using ozone-depleting substances in their products.
Many businesses replaced those ozone-depleting substances
with HFCs. HFCs became prevalent in many products. HFCs
have served as propellants in aerosol spray cans, as refrigerants
in air conditioners and refrigerators, and as blowing agents that
create bubbles in foams.

    Over time, EPA learned more about the effects of
greenhouse gases such as HFCs. In 2009, EPA concluded that
greenhouse gases may contribute to climate change, increasing
the incidence of mortality and the likelihood of extreme
weather events such as floods and hurricanes.             See
Endangerment and Cause or Contribute Findings for
Greenhouse Gases Under Section 202(a) of the Clean Air Act,
74 Fed. Reg. 66,496, 66,497-98 (Dec. 15, 2009).

    In 2013, President Obama announced that EPA would seek
to reduce emissions of HFCs because HFCs contribute to
climate change. EXECUTIVE OFFICE OF THE PRESIDENT, THE
PRESIDENT’S CLIMATE ACTION PLAN 10 (2013).             The
President’s Climate Action Plan indicated that “the
Environmental Protection Agency will use its authority
                              8
through the Significant New Alternatives Policy Program” of
Section 612 to reduce HFC emissions. Id.

     Consistent with the Climate Action Plan, EPA
promulgated a Final Rule in 2015 that moved certain HFCs
from the list of safe substitutes to the list of prohibited
substitutes. Protection of Stratospheric Ozone: Change of
Listing Status for Certain Substitutes Under the Significant
New Alternatives Policy Program, 80 Fed. Reg. 42,870 (July
20, 2015) [hereinafter Final Rule]. In doing so, EPA prohibited
the use of certain HFCs in aerosols, motor vehicle air
conditioners, commercial refrigerators, and foams – even if
manufacturers of those products had long since replaced ozone-
depleting substances with HFCs. Id. at 42,872-73.

    Therefore, under the 2015 Rule, manufacturers that used
those HFCs in their products are no longer allowed to do so.
Those manufacturers must replace the HFCs with other
substances that are on the revised list of safe substitutes.

     In the 2015 Rule, EPA relied on Section 612 of the Clean
Air Act as its source of statutory authority. EPA said that
Section 612 allows EPA to “change the listing status of a
particular substitute” based on “new information.” Id. at
42,876. EPA indicated that it had new information about
HFCs: Emerging research demonstrated that HFCs were
greenhouse gases that contribute to climate change. See id. at
42,879. EPA therefore concluded that it had statutory authority
to move HFCs from the list of safe substitutes to the list of
prohibited substitutes. Because HFCs are now prohibited
substitutes, EPA claimed that it could also require the
replacement of HFCs under Section 612(c) of the Clean Air Act
even though HFCs are not ozone-depleting substances.
                              9
     Mexichem Fluor and Arkema are businesses that make
HFC-134a for use in a variety of products. The 2015 Rule
prohibits the use of HFC-134a in certain products. The
companies have petitioned for review of the 2015 Rule. They
raise two main arguments. First, they argue that the 2015 Rule
exceeds EPA’s statutory authority under Section 612 of the
Clean Air Act. In particular, they contend that EPA does not
have statutory authority to require manufacturers to replace
HFCs, which are non-ozone-depleting substances, with
alternative substances. Second, they allege that EPA’s decision
in the 2015 Rule to remove HFCs from the list of safe
substitutes was arbitrary and capricious because EPA failed to
adequately explain its decision and failed to consider several
important aspects of the problem. We address those arguments
in turn.

                              II

                              A

    We first consider whether Section 612 of the Clean Air Act
authorizes the 2015 Rule.

    In 1987, the United States signed the Montreal Protocol.
The Montreal Protocol is an international agreement that has
been ratified by every nation that is a member of the United
Nations. The Protocol requires nations to regulate the
production and use of certain ozone-depleting substances. See
Montreal Protocol on Substances that Deplete the Ozone
Layer, opened for signature Sept. 16, 1987, S. Treaty Doc. No.
100-10, 1522 U.N.T.S. 29.

    In 1990, in part to implement U.S. obligations under the
Protocol and to regulate the production and use of ozone-
                                 10
depleting substances, Congress added a new Title to the Clean
Air Act: Title VI. Among Title VI’s provisions is Section 612.

    Section 612(a) of the Act provides: “To the maximum
extent practicable,” ozone-depleting substances that are
covered under Title VI “shall be replaced by chemicals,
product substitutes, or alternative manufacturing processes that
reduce overall risks to human health and the environment.” 42
U.S.C. § 7671k(a). Title VI sets phase-out dates for those
ozone-depleting substances. Id. §§ 7671c, 7671d.

     To implement Section 612(a), EPA maintains lists of both
safe substitutes and prohibited substitutes for ozone-depleting
substances. The provision governing those lists, Section
612(c), provides: It “shall be unlawful to replace any” ozone-
depleting substance that is covered under Title VI “with any
substitute substance” that is on EPA’s list of “prohibited”
substitutes. Id. § 7671k(c). A manufacturer that violates
Section 612(c) can be subject to substantial civil and criminal
penalties. See id. § 7413(b), (c).1

    In the years since 1990, many manufacturers of the
products relevant here – aerosols, motor vehicle air
conditioners, commercial refrigerators, and foams – have
stopped using ozone-depleting substances in those products.
Manufacturers have often replaced those ozone-depleting
substances with HFCs that have long been on the list of safe
substitutes.

     1
       Although we focus primarily on product manufacturers in this
case, our interpretation of Section 612(c) applies to any regulated
parties that must replace ozone-depleting substances within the
timelines specified by Title VI. See, e.g., 42 U.S.C. §§ 7671c, 7671d.
                                 11
     In the 2015 Rule, acting under the authority of Section
612(c), EPA moved some HFCs from the list of safe substitutes
to the list of prohibited substitutes. As a result, manufacturers
replacing ozone-depleting substances can no longer use those
HFCs as a safe substitute. Even more importantly for present
purposes, under the Rule, manufacturers that have already
replaced ozone-depleting substances with HFCs can no longer
use those HFCs in their products.

     In this case, all parties agree that EPA possesses statutory
authority to require manufacturers to replace ozone-depleting
substances within the timelines specified by Title VI –
generally by 2000 for some ozone-depleting substances, and by
2015 for other ozone-depleting substances. See, e.g., 42 U.S.C.
§§ 7671c, 7671d. If a substance on the safe substitutes list is
later found to be an ozone-depleting substance, EPA possesses
direct statutory authority to order the replacement of that
ozone-depleting substance in accordance with those statutory
timelines.

      All parties in this case also agree that EPA may change the
lists of safe and prohibited substitutes based on EPA’s
assessment of the risks that those substitutes pose for “human
health and the environment.” Id. § 7671k(c); see id.
§ 7671k(d). It follows that Section 612(c) allows EPA to move
a substitute from the list of safe substitutes to the list of
prohibited substitutes. Therefore, assuming that all other
statutory criteria are satisfied, EPA may move HFCs from the
list of safe substitutes to the list of prohibited substitutes, as it
did in the 2015 Rule.

    In addition, all parties agree that, under Section 612(c),
EPA may prohibit a manufacturer from replacing an ozone-
depleting substance that is covered under Title VI with a
prohibited substitute. It follows that EPA may bar any
                                  12
manufacturers that still make products that contain ozone-
depleting substances from replacing those ozone-depleting
substances with HFCs. Of course, that aspect of the 2015 Rule
is not a big deal as of now because there are few (if any)
manufacturers that still make products that use ozone-depleting
substances.2

     The key dispute in this case is whether EPA has authority
under Section 612(c) to prohibit manufacturers from making
products that contain HFCs if those manufacturers already
replaced ozone-depleting substances with HFCs at a time when
HFCs were listed as safe substitutes. In those circumstances,
does EPA have authority to require a manufacturer to now
replace HFCs, which are non-ozone-depleting substances, with
another substitute?

     For many years, EPA itself stated that it did not possess
authority under Section 612(c) to require the replacement of
non-ozone-depleting substances. For example, in 1994, EPA
explained that Section 612(c) “does not authorize EPA to
review substitutes for substances that are not themselves”
ozone-depleting substances. EPA Response to Comments on
1994 Significant New Alternatives Policy Rule, J.A. 50. Two
years later, EPA reiterated that interpretation: EPA explained
that it “does not regulate the legitimate substitution” of one
substance for another “first generation non-ozone-depleting”
substance. EPA Response to OZ Technology’s Section 612(d)
Petition, J.A. 145.

     2
       The parties disagree over whether, as a factual matter, any
manufacturers still make products that use ozone-depleting
substances. EPA says yes. Mexichem and Arkema say no. We need
not resolve that factual dispute here, as it has no bearing on our legal
analysis of the meaning of Section 612(c).
                                   13
     EPA now argues that it actually possesses such authority
under the statute. For the first time, EPA has sought to order
the replacement of a non-ozone-depleting substitute that had
previously been deemed acceptable by the agency.3

     EPA’s new interpretation of Section 612(c) depends on the
word “replace.” As noted above, Section 612(c) makes it
unlawful to “replace” an ozone-depleting substance that is
covered under Title VI with a substitute substance that is on the
list of prohibited substitutes. 42 U.S.C. § 7671k(c). EPA
recognizes that manufacturers “replace” an ozone-depleting
substance when the manufacturers initially replace that ozone-
depleting substance with a safe substitute. But EPA argues that
the initial substitution is not the only time when manufacturers
“replace” an ozone-depleting substance. EPA claims that a
manufacturer continues to “replace” the ozone-depleting
substance every time the manufacturer uses the substitute
substance, indefinitely into the future. According to EPA,
replacement is not a one-time occurrence but a never-ending
process. In EPA’s view, because manufacturers continue to
“replace” ozone-depleting substances with HFCs every time
they use HFCs in their products, EPA continues to have
authority to require manufacturers to stop using HFCs and to
use a different substitute.

    EPA’s current reading stretches the word “replace”
beyond its ordinary meaning. As relevant here, the word

     3
        During oral argument, EPA conceded that it had never
previously moved a non-ozone-depleting substance from the list of
safe substitutes to the list of prohibited substitutes. Counsel for EPA
stated: “I believe it is correct that the prior de-listings have involved
ozone depleting substitutes, and I may not be correct for that, but we
can assume for this morning that that is correct.” Tr. of Oral Arg. at
14. Since the time of oral argument, EPA has not made any filings
to this Court to retract that concession.
                                 14
“replace” means to “take the place of.” THE AMERICAN
HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE (5th ed.
2017 online); WEBSTER’S THIRD NEW INTERNATIONAL
DICTIONARY 1925 (1993); THE OXFORD ENGLISH DICTIONARY
642 (2d ed. 1989). In common parlance, the word “replace”
refers to a new thing taking the place of the old. For example,
President Obama replaced President Bush at a specific moment
in time: January 20, 2009, at 12 p.m. President Obama did not
“replace” President Bush every time President Obama
thereafter walked into the Oval Office. By the same token,
manufacturers “replace” an ozone-depleting substance when
they transition to making the same product with a substitute
substance. After that transition has occurred, the replacement
has been effectuated, and the manufacturer no longer makes a
product that uses an ozone-depleting substance. At that point,
there is no ozone-depleting substance to “replace,” as EPA
itself long recognized.4

    Under EPA’s current interpretation of the word “replace,”
manufacturers would continue to “replace” an ozone-depleting
substance with a substitute even 100 years or more from now.
EPA would thereby have indefinite authority to regulate a

    4
       The dissenting opinion says that the word “replace” may mean
“to provide a substitute for,” rather than “to take the place of.”
Dissenting Op. at 4, 6. But the dissenting opinion’s alternative
interpretation of the word “replace” suffers from the same flaw as
EPA’s interpretation. A manufacturer “provides a substitute for” an
ozone-depleting substance in a product when the manufacturer
transitions to making that product with a substitute substance. After
that transition takes place, the manufacturer can no longer “provide
a substitute for” an ozone-depleting substance. At that point, there
is no ozone-depleting substance to “provide a substitute for.”
Therefore, even under the dissenting opinion’s interpretation, a
manufacturer cannot “replace” an ozone-depleting substance after
the manufacturer stops using that substance.
                               15
manufacturer’s use of that substitute.        That boundless
interpretation of EPA’s authority under Section 612(c) borders
on the absurd.

     Because the text is sufficiently clear, we need not consider
the legislative history. See NLRB v. SW General, Inc., 137 S.
Ct. 929, 942, slip op. at 14 (2017). In any event, the legislative
history strongly supports our conclusion that Section 612(c)
does not grant EPA continuing authority to require replacement
of non-ozone-depleting substitutes. The Senate’s version of
Title VI applied to “Stratospheric Ozone and Global Climate
Protection.” S. 1630, 101st Cong. tit. VII (as passed by Senate,
Apr. 3, 1990) (emphasis added). The Senate’s version of the
safe alternatives policy would have required the replacement
not just of ozone-depleting substances, but also of substances
that contribute to climate change. Id. sec. 702, §§ 503(8),
514(a). In other words, the Senate bill would have granted
EPA authority to require the replacement of non-ozone-
depleting substances such as HFCs. But the Conference
Committee did not accept the Senate’s version of Title VI. See
H.R. Rep. No. 101-952, at 262 (1990) (Conf. Rep.). Instead,
the Conference Committee adopted the House’s narrower
focus on ozone-depleting substances. Id.; see S. 1630, 101st
Cong. sec. 711, § 156(b) (as passed by House, May 23, 1990).
In short, although Congress contemplated giving EPA broad
authority under Title VI to regulate the replacement of
substances that contribute to climate change, Congress
ultimately declined.

    Put simply, EPA’s strained reading of the term “replace”
contravenes the statute and thus fails at Chevron step 1. And
even if we reach Chevron step 2, EPA’s interpretation is
unreasonable. See Chevron U.S.A. Inc. v. Natural Resources
Defense Council, Inc., 467 U.S. 837, 843 & n.9 (1984); see also
                                16
Global Tel*Link v. FCC, 859 F.3d 39, 59-60 (D.C. Cir. 2017)
(Silberman, J., concurring).

   Notwithstanding our conclusion regarding Section 612,
EPA still possesses several statutory authorities to regulate
HFCs.

    For one thing, EPA has statutory authority under Section
612(c) to prohibit any manufacturers that still use ozone-
depleting substances that are covered under Title VI from
deciding in the future to replace those substances with HFCs.
Those manufacturers have yet to “replace” ozone-depleting
substances with a substitute. When they ultimately do replace
ozone-depleting substances, EPA may prohibit them from
using HFCs as substitutes.5

     For another thing, EPA possesses other statutory
authorities, including the Toxic Substances Control Act, to
directly regulate non-ozone-depleting substances that are
causing harm to the environment. See 15 U.S.C. §§ 2601-2629
(Toxic Substances Control Act); see also 42 U.S.C. § 7408
(National Ambient Air Quality Standards program); id. § 7412
(Hazardous Air Pollutants program); id. §§ 7470-7492
(Prevention of Significant Deterioration program); id. § 7521
(Section 202 of Clean Air Act). Our decision today does not in
any way cabin those expansive EPA authorities.

     In addition, EPA still has statutory authority to require
product manufacturers to replace substitutes that (unlike HFCs)
are themselves ozone depleting. See, e.g., 42 U.S.C. §§ 7671c,
    5
       To be sure, Mexichem and Arkema argue that EPA acted
arbitrarily and capriciously in removing HFCs from the list of safe
substitutes. As explained in Part III below, however, we reject that
argument. We conclude that EPA acted lawfully in removing HFCs
from the list of safe substitutes.
                              17
7671d. Suppose, for example, that EPA determines that a
substance is a safe substitute for ozone-depleting substances,
but EPA later concludes that the substitute is itself an ozone-
depleting substance that is covered under Title VI. In that
circumstance, EPA possesses statutory authority to order the
replacement of that ozone-depleting substance in accordance
with the timelines prescribed by Title VI.

     However, EPA’s authority to regulate ozone-depleting
substances under Section 612 and other statutes does not give
EPA authority to order the replacement of substances that are
not ozone depleting but that contribute to climate change.
Congress has not yet enacted general climate change
legislation. Although we understand and respect EPA’s
overarching effort to fill that legislative void and regulate
HFCs, EPA may act only as authorized by Congress. Here,
EPA has tried to jam a square peg (regulating non-ozone-
depleting substances that may contribute to climate change)
into a round hole (the existing statutory landscape).

     The Supreme Court cases that have dealt with EPA’s
efforts to address climate change have taught us two lessons
that are worth repeating here. See, e.g., Utility Air Regulatory
Group v. EPA, 134 S. Ct. 2427 (2014). First, EPA’s well-
intentioned policy objectives with respect to climate change do
not on their own authorize the agency to regulate. The agency
must have statutory authority for the regulations it wants to
issue. Second, Congress’s failure to enact general climate
change legislation does not authorize EPA to act. Under the
Constitution, congressional inaction does not license an agency
to take matters into its own hands, even to solve a pressing
policy issue such as climate change. Justice Breyer has
summarized that separation of powers point in another
context – there, the war against al Qaeda. See Hamdan v.
Rumsfeld, 548 U.S. 557, 636 (2006) (Breyer, J., concurring).
                               18
Justice Breyer stated in Hamdan that war is not a blank check
for the President. Id.; see also Youngstown Sheet & Tube Co.
v. Sawyer, 343 U.S. 579, 637 (1952) (Jackson, J., concurring).
So too, climate change is not a blank check for the President.

    Those bedrock separation of powers principles undergird
our decision in this case. However much we might sympathize
or agree with EPA’s policy objectives, EPA may act only
within the boundaries of its statutory authority. Here, EPA
exceeded that authority.

                               B

     EPA’s reliance on the statutory term “replace” does not
justify the 2015 Rule. But that is not necessarily the end of the
matter. EPA suggests that it may be able to require
manufacturers to replace HFCs under an alternative theory.
The question under that alternative theory is this: May EPA
retroactively conclude that a manufacturer’s past decision to
“replace” an ozone-depleting substance with HFCs is no longer
lawful, even though the original replacement with HFCs was
lawful at the time it was made? Under such a “retroactive
disapproval” approach, EPA could prohibit manufacturers
from making products that use HFCs even though those HFCs
were deemed safe substitutes at the time the manufacturers
decided to initially replace an ozone-depleting substance with
HFCs.

     EPA’s brief to this Court advanced such an argument only
in passing. In its brief, EPA stated: An “agency’s inherent
authority to revise an earlier administrative determination
where faced with new developments or in light of
reconsideration of the relevant facts is an essential part of the
office of a regulatory agency.” EPA Br. 27 (internal quotation
marks omitted).
                               19

     The problem for present purposes is that EPA did not
squarely articulate a “retroactive disapproval” rationale in the
2015 Rule. Instead, EPA relied on its expansive interpretation
of the word “replace” in the Rule. Therefore, we may not
uphold the Rule based on the “retroactive disapproval” theory.
See SEC v. Chenery Corp., 332 U.S. 194, 196 (1947);
Pasternack v. National Transportation Safety Board, 596 F.3d
836, 838 (D.C. Cir. 2010).

    Rather, we must remand to EPA. On remand, if EPA
decides to pursue this “retroactive disapproval” approach, the
agency would have to address at least three issues.

     First, for this “retroactive disapproval” theory to hold up,
EPA would have to reasonably conclude either (i) that Section
612(c) provides EPA with statutory authority to employ a
“retroactive disapproval” approach or (ii) that EPA has
inherent authority to retroactively disapprove a prior
replacement, even a replacement that occurred many years ago.
See generally Vartelas v. Holder, 566 U.S. 257, 266 (2012)
(retroactivity principles in statutory interpretation); Ivy Sports
Medicine, LLC v. Burwell, 767 F.3d 81, 86 (D.C. Cir. 2014)
(scope of agencies’ inherent reconsideration authority).

     Second, if EPA concludes that it has authority for
“retroactive disapprovals,” EPA must explain the basis for its
conclusion and explain its change in interpretation of Section
612(c). See FCC v. Fox Television Stations, Inc., 556 U.S. 502,
515 (2009). As noted above, before the 2015 Rule, EPA
indicated that Section 612(c) “does not authorize EPA to
review substitutes for substances that are not themselves”
covered ozone-depleting substances. EPA Response to
Comments on 1994 Significant New Alternatives Policy Rule,
J.A. 50; see Protection of Stratospheric Ozone, 59 Fed. Reg.
                                20
13,044, 13,052 (Mar. 18, 1994); EPA Response to OZ
Technology’s Section 612(d) Petition, J.A. 145. But under the
retroactive disapproval approach, EPA would in effect require
manufacturers to replace their HFCs, which are not ozone-
depleting substances, with other substitutes. Such a change in
EPA’s approach would require an explanation. Moreover, to
the extent that EPA’s prior approach had “engendered serious
reliance interests,” EPA would need to provide a “more
detailed justification” for its change. Fox, 556 U.S. at 515.

     Third, even if EPA has authority for a “retroactive
disapproval” approach, EPA must comply with applicable due
process constraints on retroactive decisionmaking. The Due
Process Clause limits the Government’s authority to
retroactively alter the legal consequences of an entity’s or
person’s past conduct. To satisfy the Due Process Clause, EPA
must at a minimum “provide regulated parties fair warning of
the conduct a regulation prohibits or requires.” Christopher v.
SmithKline Beecham Corp., 567 U.S. 142, 156 (2012) (internal
quotation marks and alteration omitted). In this case, for
example, even if EPA has statutory authority to retroactively
disapprove the replacement of an ozone-depleting substance
with HFCs, EPA plainly may not impose civil or criminal
penalties on a manufacturer based on the manufacturer’s past
use of HFCs at the time when EPA said it was lawful to use
HFCs. See id. We do not understand EPA to disagree with that
proposition.

     Unless and until EPA concludes on remand that it has
cleared those three hurdles,6 EPA may not apply the 2015 Rule

    6
       We take no position now on whether EPA can meet those
requirements. Moreover, we note that those three requirements
would be necessary for EPA to prevail on a “retroactive disapproval”
theory. We do not opine here on whether they would be sufficient.
                               21
to require manufacturers to replace one non-ozone-depleting
substitute with another substitute, so long as the initial
substitute was listed as safe at the time the substitution was
effectuated. Of course, even if EPA concludes that it has
cleared those hurdles, EPA’s conclusions may be subject to
review in this Court in another case.

     In short, we vacate the 2015 Rule to the extent the Rule
requires manufacturers to replace HFCs with a substitute
substance. We remand to EPA. On remand, if it chooses, EPA
may determine whether it has “retroactive disapproval”
authority – whether, in other words, it has authority to conclude
that a manufacturer’s past decision to replace an ozone-
depleting substance with HFCs is no longer lawful.

                               III

     Our conclusion that the 2015 Rule must be vacated to the
extent it requires manufacturers to replace HFCs does not
answer the question whether EPA reasonably removed HFCs
from the list of safe substitutes in the first place. Mexichem
and Arkema assert that EPA’s decision to remove HFCs from
the list of safe substitutes was arbitrary and capricious. In
support, they advance a number of arguments.

     The arbitrary and capricious standard requires that a rule
be “reasonable and reasonably explained.” Communities for a
Better Environment v. EPA, 748 F.3d 333, 335 (D.C. Cir. 2014)
(internal quotation marks omitted). EPA must “examine the
relevant data and articulate a satisfactory explanation for its
action.” Motor Vehicle Manufacturers Association of United
States, Inc. v. State Farm Mutual Automobile Insurance Co.,
463 U.S. 29, 43 (1983). Applying that deferential standard, we
reject all of Mexichem and Arkema’s arbitrary and capricious
challenges.
                                 22

     First, Mexichem and Arkema assert that EPA ignored a
key “requirement” in the 1994 Rule implementing Section
612(c) – namely, that EPA may “restrict only those substitutes
that are significantly worse” than the available alternatives.
Reply Br. 21; Protection of Stratospheric Ozone, 59 Fed. Reg.
13,044, 13,046 (Mar. 18, 1994) (capitalization altered). They
claim that EPA did not demonstrate that HFCs are significantly
worse than the available alternatives. In fact, however, the
1994 Rule said that restricting significantly worse substitutes
was just one of seven “guiding principles” for EPA – not a
hard-and-fast requirement. Protection of Stratospheric Ozone,
59 Fed. Reg. at 13,046. Moreover, based on data regarding the
environmental effects of the relevant substances, EPA
repeatedly concluded that the substances EPA added to the list
of prohibited substitutes posed a “significantly greater risk”
than the available alternatives. See, e.g., Final Rule, 80 Fed.
Reg. at 42,904, 42,905, 42,912, 42,915, 42,917, 42,919. So
that challenge fails.7

     Second, Mexichem and Arkema argue that EPA should not
have relied so heavily on the numeric Global Warming
Potential score to assess the “Atmospheric effects and related
health and environmental impacts” of HFCs and other
substitutes. 40 C.F.R. § 82.180(a)(7)(i). But as EPA has
explained, that is the tool preferred by leading scientists for
analyzing the effects of greenhouse gases. EPA Response to

    7
       Mexichem and Arkema also assert that EPA’s decision to
change the listing status of HFCs violated EPA’s regulations because
EPA did not compare HFCs to the proper comparator substances.
See 40 C.F.R. §§ 82.170(a), 82.172. That is not accurate. In the 2015
Rule, EPA compared HFCs with other substances that are on EPA’s
list of safe substitutes, as EPA is permitted to do under its
regulations. See id. § 82.170(a); Final Rule, 80 Fed. Reg. at 42,937.
                              23
Comments on Proposed Rule at 162, J.A. 727. EPA reasonably
relied on the Global Warming Potential score.

     Third, Mexichem and Arkema suggest that EPA failed to
provide objective benchmarks for determining which
substances’ Global Warming Potential scores were too high to
be acceptable. But EPA was not assessing the score of each
individual substance in isolation. Instead, EPA was comparing
substances with one another. EPA reasonably concluded that
substances with higher scores posed a greater global warming
risk than substances with lower scores. See, e.g., Final Rule,
80 Fed. Reg. at 42,882. That is a “comprehensible” and
objective method for assessing environmental risks. Postal
Service v. Postal Regulatory Commission, 785 F.3d 740, 753
(D.C. Cir. 2015).

     Fourth, according to Mexichem and Arkema, EPA failed
to consider data regarding the overall amount of each substitute
that would be emitted into the atmosphere. Not so. EPA
considered whether there were “substantial differences”
between HFCs and other substitutes that “might affect total
atmospheric emissions.” Final Rule, 80 Fed. Reg. at 42,938.
EPA also looked at other factors related to atmospheric
emissions, “such as charge size of refrigeration equipment and
total estimates of production,” as part of “its assessment of
environmental and health risks of new alternatives.” Id.
Because EPA accounted for factors that affect the quantity of
emissions, EPA did not entirely fail to “consider an important
aspect of the problem.” State Farm, 463 U.S. at 43.

     Fifth, Mexichem and Arkema assert that EPA should have
accounted for energy efficiency when assessing the
atmospheric effects of HFCs. But as EPA explained, the
energy efficiency of a substance often is not informative in
isolation. Final Rule, 80 Fed. Reg. at 42,921-22. The
                               24
efficiency of the substance depends on the efficiency of the
equipment in which the substance is used. In part because EPA
cannot control the efficiency of equipment under Section
612(c), EPA decided not to evaluate the energy efficiency of
substitutes in its analysis. Id. Under those circumstances,
EPA’s approach was reasonable and reasonably explained.

     Sixth, Mexichem and Arkema argue that EPA should have
placed conditions on how HFCs could be used, rather than
entirely prohibiting certain uses of HFCs. But EPA adequately
explained that use controls are typically appropriate when a
particular use of a substance carries an especially high risk that
can be mitigated by placing conditions on that use. Id. at
42,899. Use controls would not be appropriate for HFCs, EPA
stated, because the hazards of HFCs are not unique to particular
uses. Instead, “the environmental risks” from HFCs “are due
to the collective global impact of refrigerant emissions released
over time.” Id. EPA also explained that use controls for HFCs
did not make sense because other substitutes are readily
available. Id. That conclusion is reasonable and reasonably
explained for purposes of arbitrary and capricious review under
the Administrative Procedure Act.

     Seventh, Mexichem and Arkema claim that EPA failed to
consider transition costs – that is, the costs of transitioning
from prohibited HFCs to approved substitutes. But EPA did
take transition costs into account when it decided to give
certain product manufacturers extra time to comply with the
Rule. See, e.g., id. at 42,933. EPA acted reasonably for
purposes of arbitrary and capricious review.

                           *    *    *

    In sum, we grant the petitions and vacate the 2015 Rule to
the extent it requires manufacturers to replace HFCs with a
                              25
substitute substance.     We remand to EPA for further
proceedings consistent with this opinion. We reject all of
Mexichem and Arkema’s other challenges to the 2015 Rule.
The petitions are therefore granted in part and denied in part.

                                                   So ordered.
     WILKINS, Circuit Judge, concurring in part and dissenting
in part: I must depart from the Court’s opinion concluding that
Section 612 of the Clean Air Act unambiguously prohibits EPA
from requiring the replacement of HFCs. The majority claims
that “EPA’s novel reading of Section 612 is inconsistent with
the statute as written,” because Section 612 does not provide
EPA with the authority to require “manufacturers to replace
non-ozone-depleting substances such as HFCs.” Maj. Op. 3.
Accordingly, the majority disposes of the issue in a Chevron
step-one analysis through an interpretation of the word
“replace.” See id. at 9-15. I disagree. The bar for deciding a
case at Chevron step one is high, requiring clear and
unambiguous congressional intent. See Chevron, U.S.A., Inc.
v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 843 (1984).
Because the term “replace” is susceptible of multiple
interpretations in this context, it cannot serve as the basis for
discerning clear congressional intent. See, e.g., U.S. Postal
Serv. v. Postal Regulatory Comm’n, 640 F.3d 1263, 1267 n.4
(D.C. Cir. 2011) (“Our second inquiry will require us to
proceed to Chevron step 2 because the phrase ‘due to’ has an
additional—and ambiguous—meaning, which the Commission
did not address.”). Thus, the Court must proceed to Chevron
step two and decide whether EPA’s interpretation of the
statutory scheme is reasonable. Because I find that it is, I
would deny the petition on all grounds.

                              I.

    We review EPA’s interpretation of the Clean Air Act
under the two-step framework established in Chevron. See
Catawba Cnty., N.C. v. EPA, 571 F.3d 20, 35 (D.C. Cir. 2009).
Pursuant to step one of the Chevron analysis, “both the agency
and the courts [must] give effect to Congress’s unambiguously
expressed intent if the underlying statute speaks directly to the
precise question at issue.” Citizens of Coal Council v. Norton,
300 F.3d 478, 481 (D.C. Cir. 2003). In other words, “if the
                               2
intent of Congress is clear and unambiguously expressed by the
statutory language at issue, that would be the end of our
analysis.” Zuni Pub. Sch. Dist. No. 89 v. Dep’t of Educ., 550
U.S. 81, 93 (2007). When making this determination, we may
rely on the traditional tools of statutory interpretation,
including the statute’s text, structure, purpose, and legislative
history. Citizens of Coal Council, 300 F.3d at 481.

     I respectfully disagree with the majority that the relevant
language in Section 612 meets the Chevron step one standard.
This is simply not a case where Congress has clearly and
directly spoken to the issue in a manner that “unambiguously
foreclosed the agency's statutory interpretation.” Catawba
Cnty., 571 F.3d at 35.

     The majority focuses primarily upon two provisions of
Section 612 as clearly and unambiguously demonstrating that
the 2015 Rule was not authorized by Congress. Here are the
two provisions:

       To the maximum extent practicable, class I and
       class II substances shall be replaced by
       chemicals, product substitutes, or alternative
       manufacturing processes that reduce overall
       risks to human health and the environment.

42 U.S.C. § 7671k(a) (emphasis added).

       Within 2 years after November 15, 1990, the
       Administrator shall promulgate rules under this
       section providing that it shall be unlawful to
       replace any class I or class II substance with
       any     substitute   substance    which     the
       Administrator determines may present adverse
       effects to human health or the environment,
                                3
        where the Administrator has identified an
        alternative to such replacement that—
             (1) reduces the overall risk to human health
        and the environment; and
             (2) is currently or potentially available.
        The Administrator shall publish a list of (A) the
        substitutes prohibited under this subsection for
        specific uses and (B) the safe alternatives
        identified under this subsection for specific
        uses.

Id. § 7671k(c) (emphasis added).

      The majority contends that the word “replace,” when used
in these two provisions, can have only one meaning: to “take
the place of.” Maj. Op. 13-14; see id. at 14 (“In common
parlance, the word ‘replace’ refers to a new thing taking the
place of the old.”). Under this definition, a substitute can only
“replace” an ozone-depleting substance once. After the
manufacturer has transitioned from an ozone-depleting
substance to a non-ozone-depleting substitute, there is nothing
left to “replace.” Id. While the majority’s definition may be
one way to interpret the statute, for several different reasons, it
is by no means the only way to construe the text.

    First, with respect to the plain text of the statute, the
meaning of the word “replace” is ambiguous. Nowhere in
Section 612 is the term “replace” statutorily defined. See 42
U.S.C. § 7671 (definitions). The majority does not disagree,
and instead relies on dictionary definitions to conclude that
“replace” means to “take the place of.” Maj. Op. 13-14.
However, each of the dictionaries cited by the majority also
defines “replace” to mean to “substitute for.” See THE
AMERICAN HERITAGE DICTIONARY OF THE ENGLISH
LANGUAGE (5th ed. 2017 online) (“To fill the place of; provide
                                4
a substitute for”); WEBSTER’S THIRD NEW INTERNATIONAL
DICTIONARY 1925 (1993) (“[T]o take the place of: serve as a
substitute for or successor of”); THE OXFORD ENGLISH
DICTIONARY 642 (2d ed. 1989) (“To take the place of, become
a substitute for (a person or thing).”).

     The difference in meaning between “to take the place of”
and “to provide a substitute for” may be subtle, but it is rather
significant in the context of this statute. Section 612 pertains
to replacing a category, or class, of chemical substances;
indeed the substances are defined in the statute as “class I” and
“class II” substances. 42 U.S.C. § 7671(3), (4). Thus, this
statute is not directed to a specific individual or position, and
the majority’s example noting that “President Obama replaced
President Bush at a specific moment in time,” Maj. Op. 14, is
therefore inapposite. A more pertinent example would be:
“Hybrid electric engines, fully electric engines, hydrogen fuel
cell power, and other alternatives are replacing the internal
combustion engines in passenger cars.” The Oxford Dictionary
provides a similar example sentence: “This is required to
replace older medicines that will eventually face competition
from generic substitutes.” Replace, OXFORD DICTIONARY,
https://en.oxforddictionaries.com/definition/replace         (last
accessed July 14, 2017). In both examples, the ubiquitous
product that has become the industry standard is “replaced” by
a number of substitutes, and the replacement takes place not at
a specific point in time, not just once, and not by a single
substitute. Instead, the ubiquitous item is “replaced” by any
number of substitutes over the course of years, and it may be
the case that one substitute is succeeded by a better substitute
at some point in time. As one dictionary puts it, “Replace
applies both to substituting something new or workable for that
which is lost, depleted or won out and to placing another in the
stead of one who leaves or is dismissed from a position.”
American Heritage Dictionary (2d Coll. ed. 1982).
                                  5
     Second, the structure of the statutory text also contradicts
the clear meaning proffered by the majority. The two key
provisions of Section 612 are not directed to any particular
group of individuals or class of companies. They provide that
“class I and class II substances shall be replaced by chemicals,
product substitutes, or alternative manufacturing processes,”
42 U.S.C. § 7671k(a), and that “it shall be unlawful to replace
any class I or class II substance with any substitute substance,”
id. § 7671k(c). These Congressional mandates, written in the
passive voice and without identifying a particular target of the
regulation, appear to apply to anyone and everyone, including
retailers, product manufacturers and chemical manufacturers.1
The majority focuses on product manufacturers, contending
that once the manufacturer replaces the class I or class II
substance in its product with a non-ozone-depleting substitute,
“the replacement has been effectuated.” Maj. Op. 14.

     However, this point of view ignores the retailer. Suppose
a retailer needs to refurbish an air conditioner manufactured in
the early 1990s that uses a class I substance as a refrigerant. If
the retailer chooses to have the air conditioner serviced by
recharging it with new refrigerant, she is prohibited from

1
  In other provisions of Section 612, Congress identified the target of
the regulation as chemical manufacturers, like the petitioners in this
case. See, e.g., 42 U.S.C. § 7671(e) (“The Administrator shall
require any person who produces a chemical substitute for a class I
substance to provide the Administrator with such person's
unpublished health and safety studies on such substitute and require
producers to notify the Administrator not less than 90 days before
new or existing chemicals are introduced into interstate commerce
for significant new uses as substitutes for a class I substance.”
(emphasis added)); see also id. § 7671(11) (defining “produce” as
“the manufacture of a substance from any raw material or feedstock
chemical . . . .”).
                                6
“replacing” the class I substance with a chemical substitute
“which the Administrator determines may present adverse
effects to human health or the environment[,]” 42 U.S.C.
§ 7671k(a). If the retailer chooses to purchase a new air
conditioner instead, she is still “replacing” a class I substance,
and the new air conditioner cannot contain an unsafe substitute.
Id. Either way, the retailer’s action falls within the scope of the
mandates in Section 612. And if the retailer purchases a new
air conditioner, the fact that the manufacturer may have
previously “replaced” a class I substance with an HFC as the
refrigerant in its air conditioners does not mean that “the
replacement has [already] been effectuated” with respect to that
retailer. See Maj. Op. 14. By the express terms of the statute,
if the EPA determines as of 2017 that HFCs are no longer safe
substitutes for class I substances given available refrigerant
alternatives, it would appear that Congress has given EPA the
authority to prohibit the further use of HFCs in air conditioners
so that the retailer in our example cannot “replace” her class I
substance-utilizing air conditioner with a new air conditioner
utilizing an unsafe substitute. The majority holds otherwise.
Alternatively, the express terms of the statute appear to give
EPA the authority to prohibit the retailer from recharging her
old air conditioner with an HFC as the refrigerant, which the
agency could implement by restricting the manufacture,
marketing, and use of HFCs. Given its focus on product
manufacturers, the majority opinion is curiously silent about
how its statutory interpretation affects retailers and other end
users who have products utilizing class I and class II
substances, despite the obvious importance of the issue.

     In my view, the connotation of “replace” as “to provide a
substitute for” more accurately reflects the intent of Congress
given the use of the term and sentence structure in the key
statutory provisions. This interpretation is further supported by
the fact that Congress used the word “substitute” ten separate
                                7
times in Section 612, and the word “alternative” a dozen times
more, including in the title of the section. See 42 U.S.C.
§ 7671k (“Safe Alternatives Policy”).           In that context,
“replacing” the class I or class II substance is not necessarily a
one-time event and alternatives or substitutes can be deemed
replacements or successors, even if they are not the first-
generation successor. At a minimum, the definition of
“replace” is ambiguous, and “to provide a substitute for” just
as likely manifests Congress’s intent as the definition proffered
by the majority. “Confronted by two plausible readings of the
statute, we cannot declare Congress’ intent unambiguous.”
Adirondack Med. Ctr. v. Sebelius, 740 F.3d 692, 698 (D.C. Cir.
2014).

     Third, the majority’s interpretation also undermines the
purpose of Section 612, which is, “[t]o the maximum extent
practicable,” to carry out the replacement of class I and class II
substances with “chemicals, product substitutes, or alternative
manufacturing processes that reduce overall risks to human
health and the environment.”           42 U.S.C. § 7671k(a).
Significantly, Congress authorized EPA to develop a list of
unsafe alternatives and a list of safe alternatives, but Congress
chose, for whatever reason, only to bar the use of alternatives
on the “unsafe list,” rather than mandating the use of only those
alternatives appearing on the “safe list.” See id. § 7671k(c) (“it
shall be unlawful to replace any class I or class II substance
with any substitute substance which the Administrator
determines may present adverse effects to human health or the
environment”). By writing the statute in this manner, Congress
allowed manufacturers to replace class I and II substances with
alternatives that have not been specifically approved by the
EPA, so long as the substitute has not been specifically deemed
unsafe by the EPA. The majority’s interpretation of “replace”
makes a mockery of the statutory purpose, because a product
manufacturer could “replace” a class I substance with a
                                8
substitute before the EPA has a chance to evaluate it
completely, and if the agency later determines that a different
substitute “reduce[s] overall risks to human health and the
environment,” id. § 7671k(a), the agency would be powerless
to tell that product manufacturer that it could no longer use the
more risky substitute.        In the majority’s view, the
“replacement” is a fait accompli, and EPA is powerless to act
under Section 612. Such an interpretation undermines
Congress’s intent to “reduce overall risks to human health and
the environment” in a manner “to the maximum extent
practicable.” Id.

     In doing so, the majority takes an even more extreme
position than petitioners, who conceded that “if ozone-
depleting substances are in use, EPA can list and de-list” to and
from the lists of acceptable and unacceptable alternatives. Oral
Arg. at 11:07, Mexichem Fluor, Inc. v. EPA (Feb. 17, 2017)
(No. 15-1328). According to petitioners, EPA “can list or de-
list ozone-depleting substances and non-ozone-depleting
substances because the list at that point is consisting of things
that will replace the things that are in use, which are ozone-
depleting substances . . . .” Id. at 11:14 (emphasis added). The
petitioners are at least trying to interpret “replace” in a manner
consistent with the statutory purpose – but as explained infra
in part II, they are simply wrong on the facts, because ozone-
depleting substances are still in use. The majority’s definition
of “replace,” on the other hand, has no semblance of
consistency with this aspect of Congress’s purpose.

     Indeed, Section 612 is aimed at regulating which
substitutes can be used as replacements for class I and class II
substances, rather than regulating those ozone-depleting
substances themselves. Congress phased out the production
and manufacture of ozone-depleting substances in other
statutory provisions. See 42 U.S.C. §§ 7671c, 7671d. Section
                                9
612, on the other hand, is focused solely on substituting class I
and class II substances with safe alternatives. See id. § 7671k.
Because Section 612 promotes the use of safe substitutes, it
necessarily requires a reading of the word “replace” that
comports with this congressional intent. The majority’s
cramped reading of the statute contradicts Congress’s intent
that the EPA prohibit the use of “any substitute substance” that
may “present adverse effects to human health and the
environment” where a less risky substitute is available. Id. §
7671k(c) (emphasis added).

      Moreover, the majority’s interpretation also runs counter
to the purpose of the petition process contained in Section 612.
Congress provided that “[a]ny person may petition the
Administrator to add a substance to the [safe or unsafe
alternatives] lists . . . or to remove a substance from either of
such lists.” Id. § 7671k(d). The petition process becomes a
half-measure if EPA is only allowed to “replace” an ozone-
depleting substance once and only once. The majority’s
interpretation grants EPA one bite at the apple, prohibiting
additions to the unsafe substitutes list or removals from the safe
substitutes list if the product manufacturer has already begun
using a non-ozone-depleting substitute for the class I or class II
substance. By creating this petition process, it is evident that
Congress desired the safe alternatives list to be a fluid and
evolving concept that promotes those alternatives that pose the
least overall risk to human health and the environment.
Congress undoubtedly knew how to instruct EPA to develop a
list of acceptable and unacceptable substitutes by a certain date
and then stop there. The fact that Congress did not do so is
telling. See City of Arlington, Tex. v. FCC, 133 S. Ct. 1863,
1868 (2013) (“Congress knows to speak in plain terms when it
wishes to circumscribe, and in capacious terms when it wishes
to enlarge, agency discretion.”). Congress chose a starkly
different path, and the majority has taken the power that
                               10
Congress granted individuals to request the addition of more
risky substitutes to the unsafe list and rendered it largely
impotent.     When interpreting two interrelated statutory
provisions, “[a]bsent clearly expressed congressional intent to
the contrary, it is our duty to harmonize the provisions and
render each effective.” Adirondack Med. Ctr., 740 F.3d at
698–99.

      Fourth, the majority’s references to EPA’s prior
interpretations of its statutory authority cannot change the
Chevron step one analysis. See Maj. Op. 12. I agree with the
majority that we must reject any EPA interpretation of
“replace” if we determine that Congress has clearly and
directly spoken to the contrary, because “[t]he judiciary is the
final authority on issues of statutory construction and must
reject administrative constructions which are contrary to clear
congressional intent.” Chevron, 467 U.S. at 843 n.9. But the
EPA’s interpretations of the statute are not themselves suitable
evidence of Congress’s clear intent. See Village of Barrington,
Ill. v. Surface Transp. Bd., 636 F.3d 650, 660 (D.C. Cir. 2011);
see also Kentuckians for Commonwealth Inc. v. Rivenburgh,
317 F.3d 425, 443 (4th Cir. 2003) (“Agency interpretations of
statutory provisions only come into play if Congress has not
spoken clearly. Relying on agency interpretations as evidence
of a clear congressional intent is therefore misguided.”
(emphasis in original)).

     Finally, an examination of Section 612’s legislative
history does not change the outcome. Where “a statute is silent
or ambiguous with respect to the question at issue,” we must
“defer to the ‘executive department’s construction of a
statutory scheme it is entrusted to administer,’ unless the
legislative history of the enactment shows with sufficient clarity
that the agency construction is contrary to the will of
Congress.” Japan Whaling Ass'n v. Am. Cetacean Soc., 478
                                11
U.S. 221, 233 (1986) (quoting Chevron, 467 U.S. at 844
(emphasis added, citation omitted)).           In other words,
“conflicting [legislative history] cannot clarify ambiguous
statutory language,” Am. Bankers Ass'n v. Nat'l Credit Union
Admin., 271 F.3d 262, 269 (D.C. Cir. 2001), and “[w]hile
[legislative] history can be used to clarify congressional intent
even when a statute is superficially unambiguous, the bar is
high,” Williams Companies v. FERC, 345 F.3d 910, 914 (D.C.
Cir. 2003).

     Here, the legislative history cited by the majority cannot
meet the required high bar to show clear Congressional intent,
particularly since the legislative activity “was not . . . addressed
to the precise issue raised by th[is] case[].” Chevron, 467 U.S.
at 853. The precise question presented here is whether
“Section 612 unambiguously covers only replacements of
ozone-depleting substances and does not authorize
‘replacements of replacements’.” Pet’rs’ Br. 29. The Senate
bill cited by the majority had no provisions whatsoever
regarding how replacements of covered substances were to be
carried out. Instead, the Senate bill would have phased out
production entirely of not only ozone-depleting substances, but
also certain substances which were known or reasonably
suspected to contribute to “atmospheric or climatic
modification.” S. 1630, 101st Cong. §§ 504, 506 (as passed by
Senate, Apr. 3, 1990). But the Senate bill had no provisions for
creating a list of acceptable substitutes or for prohibiting
unacceptable substitutes; nor did it have any provisions for
adding substitutes to, or removing substitutes from, the
“acceptable” and “unacceptable” lists. Instead, the Senate bill
directed EPA to support programs to identify and promote the
development of safe alternatives and to maintain a public
clearinghouse of “available” alternatives. Id. § 514. All of the
statutory provisions in Section 612 concerning acceptable and
banned alternatives originated in the House bill. S. 1630, 101st
                               12
Cong. § 156 (1990) (as passed by House, May 23, 1990). At
best, this legislative history shows that Congress rejected a
proposal to ban and phase out the production of substances that
contribute to climate change. However, the history is silent on
the much different question of whether Congress intended to
allow EPA to make “replacements of replacements” of the
substitutes for banned ozone-depleting substances. Because
“the legislative history as a whole is silent on the precise issue
before us,” Chevron, 467 U.S. at 862, it cannot demonstrate
clear congressional intent on that question.

                              ***

     Given my interpretation of Section 612’s plain language,
purpose, and legislative history, I cannot agree with my
colleagues that the word “replace” clearly and unambiguously
means to “take the place of,” and only permits a one-time
replacement of ozone-depleting substances. Rather, at a
minimum, sufficient ambiguity exists to proceed to Chevron
step two. See, e.g., NRDC v. EPA, 22 F.3d 1125, 1138 (D.C.
Cir. 1994) (“Because the phrase ‘take effect’ is itself
ambiguous, its meaning must be discerned according to
Chevron’s second step.”).

                               II.

     The second step in the Chevron framework requires courts
to grant deference to an administrative agency’s construction
of an ambiguous statute if that interpretation is reasonable.
Chevron, 467 U.S. at 843. “[A] court may not substitute its
own construction of a statutory provision for a reasonable
interpretation made by the administrator of an agency.” Id.
Where the interpretation would be one Congress could have
sanctioned, the administrative agency is entitled to deference
and its construction should be afforded “considerable weight.”
Id.
                               13
     For the reasons discussed in Part I, I find EPA’s
interpretation of Section 612 to be reasonable. EPA’s
interpretation comports with a common definition of the word
“replace,” which is to “[p]rovide a substitute for.” See, e.g.,
Replace, OXFORD DICTIONARY, supra. This meaning of
“replace” is consistent with Section 612’s statutory purpose,
which is, “to the maximum extent practicable,” to replace
ozone-depleting substances with “chemicals, product
substitutes, or alternative manufacturing processes that reduce
overall risks to human health and the environment.” 42 U.S.C.
§ 7671k(a)(emphasis added). Comparing alternatives to each
other and selecting the alternative that creates the lowest level
of overall risk to human health and the environment accords
nicely with the policy choice explicitly stated by Congress.
EPA’s interpretation further avoids the majority’s
manufacturer-by-manufacturer structure, which does not fully
comport with the statutory framework.

     Finally, I do not read the administrative record in the same
manner as the majority. EPA never stated that regulation of
non-ozone-depleting substitutes was completely off limits, nor
clearly acted in a manner to foreclose its present interpretation.

     The past language of EPA that is relied upon by the
majority is far from conclusive on the meaning of “replace” in
this context. It is true that EPA stated in the course of the 1994
rulemaking that “Section 612(c) authorizes EPA to review all
substitutes to Class I and II substances, but does not authorize
EPA to review substitutes for substances that are not
themselves class I or II substances.” J.A. 50. But this excerpt
alone does not tell the whole story. At the time, several
commenters requested that “EPA clarify that SNAP should
only apply to substitutes for Class I or Class II compounds,”
while another commenter suggested “that SNAP should
aggressively reevaluate previously approved second-
                                14
generation alternatives as new and environmentally preferable
alternatives are developed.” Id. EPA began its response to
these comments as follows:

        A key issue is whether there exists a point at
        which an alternative should no longer be
        considered a class I or II substitute as defined
        by Section 612. The Agency believes that as
        long as class I or II chemicals are being used,
        any substitute designed to replace these
        chemicals is subject to review under Section
        612.

J.A. 50 (emphasis added). This statement by the agency is
consistent with how it has construed “replace” in the 2015
Rule.

     Furthermore, EPA’s seemingly contradictory statement
relied upon by the majority must be placed in context. In
Section 612, Congress specified that producers of chemical
substitutes for class I substances are required “to provide the
Administrator with such person's unpublished health and safety
studies on such substitute and require producers to notify the
Administrator not less than 90 days before new or existing
chemicals are introduced into interstate commerce for
significant new uses as substitutes for a class I substance.” 42
U.S.C. § 7671k(e). This advance reporting requirement gives
the agency a 90-day period to review the chemical substitute
and related data and make a determination as to whether it is a
safe alternative or unsafe alternative for a class I or class II
substance before the substitute hits the marketplace.2 The EPA

2
 During the 1994 rulemaking, EPA stated its intent to apply the 90-
day advance reporting requirement to new substitutes for class II
                                    15
and the National Resources Defense Council contend that
EPA’s 1994 comment only pertained to the 90-day advance
reporting – and concomitant – review requirements of the
SNAP program. Resp’t’s Br. 6; NRDC Intervenor’s Br. 13.
Thus, when the agency stated that “Section 612(c) authorizes
EPA to review all substitutes to Class I and II substances, but
does not authorize EPA to review substitutes for substances
that are not themselves class I or II substances,” J.A. 50, EPA
argues it meant only that 1) it could not require 90-day advance
reporting of intended use and health data for certain second-
generation substitutes by chemical manufacturers, and 2) the
agency was not required to conduct an advance review before
any such second-generation substitute hit the market. Thus,
EPA contends that it never said, or meant to say, that EPA had
no power whatsoever to review second-generation substitutes,
either in response to a petition or on the agency’s own accord.
While the back and forth in the commentary during the 1994
rulemaking is not crystal clear, it appears to support the
interpretation that EPA only intended to disclaim authority to
“review” second-generation substitutes in the 90-day advance
notification and review context, and only if the first-generation
substitute was a non-ozone-depleting substance. See id. (“For
example, if a hydrofluorocarbon (HFC) is introduced as a first-
generation refrigerant substitute for either a class I (e.g., CFC-
12) or class II chemical (e.g., HCFC-22), it is subject to review

substances, even though the statute only expressly mentions the
advance reporting requirement in the context of substitutes for class
I substances. J.A. 42. This deadline for review following advance
notice and reporting is the same as in the petition process, where
Congress required that EPA, within 90 days, to “grant or deny” a
petition to add a substitute to, or remove a substitute from, either the
safe alternatives list or the unsafe alternatives list for class I and class
II substances. 42 U.S.C. § 7671k(d).
                                16
and listing under section 612. Future substitutions to replace
the HFC would then be exempt from reporting under section
612 because the first-generation alternative did not deplete
stratospheric ozone.” (emphasis added)).3

     The majority also relies upon EPA’s statement in response
to a 1995 petition by OZ Technology, Maj. Op. 12, but there
the EPA appears to have disclaimed regulatory authority under
SNAP if the substance is being proffered as a “legitimate
substitut[e]” for a non-ozone-depleting substance, rather than
as a substitute for a class I or class II ozone-depleting
substance. J.A. 145, 412. EPA exerted regulatory authority
over the petition because it found that OZ Technology
submitted its proposed alternative as a substitute for CFC-12,
an ozone-depleting substance, rather than as a substitute to
HFC-134a, a non-ozone-depleting substitute. J.A. 412, 415.
This course of events seems to be consistent with the agency’s
position here. At any rate, petitioners concede that the HFCs
they manufacture are substitutes for CFCs, which are ozone-
depleting substances. Thus, petitioners do not stand in the
same shoes as OZ Technology and they have not identified any
statements where EPA has disclaimed authority to regulate
HFCs or other direct substitutes for ozone-depleting substances
such as CFCs.

    I understand (and share) the majority’s concern that the
Clean Air Act does not grant EPA the authority to take a

3
  Similarly, in this same passage, EPA also stated “[w]here second-
generation substitutes replace first-generation substitutes that are
themselves ozone-depleters (e.g., HCFCs), these second-generation
substitutes are bound by the same notification and review
requirements under section 612 as first-generation substitutes to
ozone-depleting chemicals.” Id. (emphasis added).
                               17
completely unbounded approach and thereby regulate
“substitutes” for class I and class II substances forever. In my
view, the regulation of substitutes under Section 612 requires
that the traditional and ubiquitous ozone-depleting substance
originally utilized for the specific end-use is still in service.
Without the prerequisite of an ozone-depleting substance, there
can be nothing for the substitute to “replace.” In other words,
where ozone-depleting chemicals are no longer in existence or
in use for a particular industry or end-use, then EPA cannot
regulate substitutes for those end-uses under Section 612.

     Here, petitioners claim that “class I and class II substances
have already been replaced” with respect to the 25 end-uses
addressed in the 2015 Rule. Pet’rs’ Br. 20. In support of this
assertion, Petitioners rely on two examples. First, Petitioners
state that in the motor-vehicle air conditioning sector, CFC-12,
which is an ozone-depleting substance, had historically been
used. Id. However, Petitioners claim that the record shows that
by the mid-1990s, use of CFC-12 in the manufacture of new
cars stopped in the United States, and manufacturers uniformly
adopted HFC-134a as a substitute. Id. This statement is true
as far as it goes, but it does not show that ozone-depleting
substances are not still in use in the motor-vehicle air
conditioning sector. Indeed, the record confirms “some older
vehicles may still be using CFC-12.” J.A. 815. Thus, we
cannot conclude that ozone-depleting substances are not still in
“use” in this sector.

     Second, Petitioners reference the commercial refrigeration
industry, arguing that because the commercial refrigeration
industry has “transitioned away” from ozone-depleting
substances, such substances are no longer in use in this sector.
See Pet’rs’ Br. 21; J.A. 528. This argument suffers from the
same flaw as the motor-vehicle air conditioning argument. The
fact that modern commercial refrigeration systems may not use
                              18
ozone-depleting chemicals does not mean that older
refrigeration systems do not continue to use such substances,
and the record indicates that ozone-depleting substances
remain in “use” in the commercial refrigeration industry. J.A.
535. With respect to the other 23 challenged end-uses,
Petitioners are silent and offer no support to prove that ozone-
depleting substances have been completely eliminated in those
sectors.

     EPA responds to Petitioners’ claim, arguing that “ozone-
depleting substances are still being directly ‘replaced’ by
approved alternatives,” Resp’t’s Br. 21 n.8, and that “as long
as ozone-depleting substances are being used, any substitute
designed to replace these chemicals is subject to review” under
Section 612, id. at 31 (alterations omitted). While EPA
acknowledges that “in some cases the use of ozone-depleting
substances has ceased,” it contends that ozone-depleting
substances have not been completely eliminated such that a
“second-generation substitute world” exists. Id. Petitioners
failed to respond to this argument in their reply brief. Given
that the burden is on Petitioners to demonstrate that EPA’s
interpretation of Section 612 is unreasonable or statutorily
impermissible with respect to these 25 end-uses, they have
failed to show that the agency’s policy choice “runs counter to
the evidence before the agency, or is so implausible that it
could not be ascribed to a difference in view or the product of
agency expertise.” Mtr. Vehicle Mfrs. Ass'n of the U.S., Inc. v.
State Farm Mut. Auto. Ins., 463 U.S. 29, 43 (1983).

                              ***

    In sum, I disagree with the majority’s holding in Part II,
and concur with all remaining parts. I would find the word
“replace” sufficiently ambiguous to require a Chevron step two
analysis. Because I find that EPA’s interpretation of Section
                             19
612 is reasonable, I would deny the petition for review on all
grounds.