803 F.3d 151
3rd Cir.2015Background
- Pennsylvania submitted a 2010 Regional Haze SIP identifying 34 BART-eligible sources and concluded additional controls were not warranted because visibility benefits were minimal relative to costs; EPA approved the SIP in 2014.
- The Regional Haze program under 42 U.S.C. § 7491 requires states to identify BART-eligible sources and conduct source-specific BART analyses (or adopt a better-than-BART program) to protect Class I areas.
- Pennsylvania treated all 34 sources as subject to BART, used the EPA BART Guidelines five-step process for most sources, but relied on EPA’s cap-and-trade programs (CAIR/Transport Rule) as better-than-BART for certain large EGUs.
- The Conservation Groups challenged EPA’s limited approval, arguing (1) Transport Rule reliance was improper and (2) Pennsylvania’s source-specific BART analyses were legally defective in multiple respects.
- The Third Circuit declined to hear challenges that properly belong in the D.C. Circuit (e.g., Transport Rule merits), but found EPA’s approval of Pennsylvania’s source-specific BART analysis arbitrary and capricious due to multiple acknowledged defects and insufficient EPA explanation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Transport Rule / EPA finding that the Transport Rule is better-than-BART may be reviewed here | Challenge Transport Rule and Pennsylvania’s reliance on it as not better-than-BART and subject to delay | EPA: merits of Transport Rule were decided in separate national rulemaking; review lies in D.C. Circuit | Denied as to Transport Rule — challenge must be pursued in D.C. Circuit; court lacks record to review it here |
| Whether Pennsylvania identified and evaluated available retrofit controls (e.g., ESP upgrades, control permutations) | Pennsylvania failed to identify/describe considered upgrades and explain rejections | EPA: SIP states that upgrades/combinations were considered; exhaustive permutations not required | Court: EPA approval arbitrary — record lacks specifics and EPA did not explain why conclusory listings suffice |
| Whether Pennsylvania used proper baselines and limits for PM BART (e.g., 0.1 lb/MMBtu) | 0.1 lb/MMBtu was unsupported; states used stricter limits elsewhere | EPA: state should have examined but error was harmless/moot because many units retired or MATS would impose stricter limits | Court: EPA’s harmless-error and mootness rationales insufficient; failure to justify baseline is not excused |
| Whether Pennsylvania properly considered other program limits (BACT/LAER/MACT) | These more stringent limits show achievable reductions and should inform BART | EPA: Guidelines require considering technologies behind BACT/LAER/MACT, not exact limits; MACT reliance is presumptive, not mandatory | Held: EPA interpretation accepted — state not required to adopt BACT/LAER/MACT limits as BART limits |
| Whether Pennsylvania appropriately evaluated cost-effectiveness (thresholds and metrics) | State lacked a cost-effectiveness threshold and used $/deciview instead of $/ton mandated by Guidelines | EPA: no statutory requirement for a bright-line threshold; $/dv may be considered alongside $/ton; many sources used both metrics | Court: No requirement for fixed threshold — that argument rejected; but EPA’s unexplained characterization of $/dv use as merely "flawed" is inadequate and approval was arbitrary |
| Whether Pennsylvania considered cumulative visibility impacts across all affected Class I areas | State only assessed impact at the most-impacted Class I area, understating total benefits | EPA: agrees state should have considered cumulative impacts but claims error harmless given minimal impacts | Court: EPA’s reliance on flawed visibility calculations is inconsistent; admitting the error but still approving the SIP without adequate explanation is arbitrary |
Key Cases Cited
- Bell v. Cheswick Generating Station, 734 F.3d 188 (3d Cir.) (discussing cooperative federalism under the Clean Air Act)
- Chevron U.S.A., Inc. v. EPA, 658 F.2d 271 (5th Cir. 1981) (background on visibility provisions added to the Clean Air Act)
- Am. Corn Growers Ass’n v. EPA, 291 F.3d 1 (D.C. Cir.) (describing § 169A national visibility goal)
- North Dakota v. EPA, 730 F.3d 750 (8th Cir.) (BART identification and SIP/FIP framework)
- WildEarth Guardians v. EPA, 759 F.3d 1064 (9th Cir.) (BART Guidelines five-step process and advisory nature for smaller sources)
- Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (administrative review standard — arbitrary and capricious)
- Prometheus Radio Project v. FCC, 373 F.3d 372 (3d Cir.) (agency must articulate satisfactory explanation and rational connection between facts and choice)
- EME Homer City Generation, L.P. v. EPA, 696 F.3d 7 (D.C. Cir.) (challenge to Transport Rule/FIP)
- EPA v. EME Homer City Generation, L.P., 134 S. Ct. 1584 (U.S.) (Supreme Court decision addressing Transport Rule)
Court disposition: Vacated the 2014 Final Rule to the extent it approved Pennsylvania’s source-specific BART analysis and remanded to EPA for further proceedings consistent with the opinion.