848 F.3d 1185
9th Cir.2016Background
- Sierra Pacific applied for a PSD permit to construct a new cogeneration boiler at its Anderson, CA lumber mill to burn primarily on‑site wood waste (biomass) to produce steam and 31 MW of electricity; limited natural gas use (capped at 10%) for startup/shutdown/flame stabilization.
- EPA issued a PSD permit after a two‑phase review: initial permitting (not addressing GHG BACT), Board remand for a public hearing, then a supplemental BACT analysis for greenhouse gases following D.C. Circuit decisions vacating EPA’s prior deferral rule.
- Helping Hand Tools and Center for Biological Diversity petitioned for review, challenging (1) EPA’s refusal to treat solar power or a higher natural‑gas share as BACT control alternatives (alleged "redefining the source") and (2) EPA’s application of its Bioenergy BACT Guidance for GHGs, including treating burning biomass alone as a Step 1 option and deferring biomass‑stock comparisons to Step 4.
- The record included an EIR prepared for Shasta County (consultant) modeling a conservative fuel mix; EPA and Sierra Pacific negotiated fuel restrictions limiting permitted biomass to mill residue, certain forest residues, agricultural and urban wood wastes, and disallowing logging solely to supply fuel.
- The Ninth Circuit reviewed EPA’s decision under the APA; it applied Chevron/agency‑deference principles and substantial deference on scientific matters at the frontiers of knowledge.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether EPA had to consider solar power as a BACT fuel alternative (i.e., whether doing so would properly be a control option or would redefine the source) | Helping Hand: EPA must consider cleaner fuels like solar; excluding them improperly narrows BACT | EPA/Sierra Pacific: solar would require redesign and thus would redefine the project (not a control technology) | Court: EPA reasonably concluded solar would redefine the source; exclusion upheld |
| Whether EPA had to consider a greater percentage of natural gas as a control alternative | Helping Hand: natural gas is available on‑site and should be analyzed as a cleaner fuel option | EPA/Sierra Pacific: natural gas use is incidental/capped for startup and would disrupt the project’s primary purpose to consume on‑site biomass waste | Court: EPA reasonably concluded greater natural‑gas use would redefine/disrupt the basic business purpose; exclusion not arbitrary |
| Whether EPA permissibly listed "burn biomass alone" as a Step 1 control option in the Bioenergy BACT analysis | Center: Burning biomass cannot be a ‘‘control’’ and should not be a Step 1 option; EPA must compare alternative biomass stocks quantitatively at Step 1 | EPA: biomass‑only option serves as a baseline; indirect differences among biomass stocks are better addressed at Step 4 given scientific uncertainty | Court: EPA’s approach was reasonable and deferable; listing biomass baseline and addressing stock differences at Step 4 was not arbitrary |
| Whether EPA’s Bioenergy BACT Guidance (GHG BACT framework for biomass) is entitled to deference | Petitioners: Guidance is flawed and inconsistent with statute | EPA: Guidance is reasonable, grounded in science, and refines the top‑down BACT method for biomass GHGs | Court: Guidance is rational, consistent with prior practice, and entitled to deference; EPA did not act arbitrarily |
Key Cases Cited
- Chevron U.S.A. Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (agency interpretation entitled to deference when statute ambiguous)
- Utility Air Regulatory Group v. EPA, 134 S. Ct. 2427 (Supreme Court upheld EPA authority to apply BACT to GHGs from PSD sources)
- Sierra Club v. EPA, 499 F.3d 653 (7th Cir. 2007) (deference to EPA in drawing line between control technology and redesign)
- Center for Biological Diversity v. EPA, 722 F.3d 401 (D.C. Cir. 2013) (vacatur of EPA’s biogenic carbon deferral rule prompting supplemental BACT analysis)
- Baltimore Gas & Electric Co. v. Natural Res. Def. Council, Inc., 462 U.S. 87 (courts should be highly deferential to agencies on technical/scientific matters)
- Wilderness Soc’y v. U.S. Fish & Wildlife Serv., 353 F.3d 1051 (weight given to nonbinding agency interpretations depends on thoroughness and consistency)
- EPA v. EME Homer City Generation, L.P., 134 S. Ct. 1584 (deference to EPA interpretations under the Clean Air Act)