Changes to Alabama Emissions Rule Upheld

(CN) - The Environmental Protection Agency's approval of a change to Alabama's visible emissions rule did not violate the Clean Air Act, the 11th Circuit ruled.

Under the Clean Air Act, the EPA identifies and regulates dangerous air pollutants and sets national air quality standards. State implementation plans, or SIPs required under the law, must comply with the federal legislation.

Enforcement of the states' plans hinges on EPA review and approval. Once approved, SIP modification requires a cooperative process that involves both the state and the federal agency. When a rule is inadequate, the EPA can initiate changes to a state plan by asking the state to revise the plan and submit changes that comply with federal laws. This procedure is known as a SIP call. The agency can also correct a rule approved or disapproved "in error" without requiring the state to get involved. States can initiate revisions as well through a process that requires EPA review after public hearings and comments.

In 2003, Alabama sought to change a state rule that regulated opacity, an indicator of the amount of visible particulate pollution that plants discharge. Under its state implementation plan, Alabama requires certain plants to operate a continuous opacity monitoring system, an electronic device that records opacity measurements every six minutes. Though most sources are prohibited from emitting at levels beyond 20 percent opacity, the state sought to broaden an exception that allows plants with continuous monitoring systems to exceed that threshold for up to 2 percent of their quarterly operating time.

Alabama submitted the proposed change, known as the 2 percent de minimis rule, to the EPA for review. Following the 11th Circuit's decision in a similar case against Tennessee Valley Authority, the EPA concluded it could not approve the proposed revision, and asked Alabama for additional evidence concerning the effects of the exception.

The EPA approved the proposed change in October 2008, after Alabama clarified it and addressed public comments from citizens and the utilities industry. Opponents, including the Alabama Environmental Council and Sierra Club, asked the EPA to reconsider the approval, but the agency declined, noting that the revision complied with the Clean Air Act.

After opponents asked the 11th Circuit to review the approval, the EPA agreed to reconsider it and asked the federal appeals court to remand the issue back to the EPA. An Atlanta-based three-judge panel stayed the appeal and remanded, despite opposition from Alabama Power, TVA and the state.

In April 2011, after accepting public comments from citizens, environmental groups, Alabama Power, and other interested parties, the EPA disapproved the revision to the visible emissions portion of Alabama's state plan. The agency concluded that the revision would likely allow higher emissions than the previous rule.

Alabama Power challenged the 2011 disapproval that citizens and environmental groups had supported. The 11th Circuit consolidated the competing 2008 and 2011 petitions and refused to stay the disapproval pending appeal.

In a split decision last week, the 11th Circuit upheld the 2008 approval, finding that the 2011 disapproval was not authorized by the Clean Air Act.

The court rejected Alabama Power's contention that the EPA could only revise Alabama's state emissions plan through a SIP call procedure, but it noted that the agency was required to point to a clear error in its 2008 approval to justify its subsequent disapproval.

"We are not holding that 'magic words' are required to invoke Section 110(k)(6) [of the Clean Air Act]," Judge Susan Black wrote for the majority. "But, Congress has demanded, at a minimum, that the EPA affirmatively articulate the error committed at the time of the initial action if it chooses to rely on its Section 110(k)(6) authority to later revise that action."

The EPA failed to clarify the alleged 2008 error despite opportunities to do so, and thus did not comply with the Clean Air Act, the 51-page ruling states.

The majority found that the EPA could not rely on any inherent authority, because Congress has provided specific statutory procedures for revising a state plan regulating emissions.

It also rejected the EPA's assertion that the 11th Circuit's 2009 remand authorized it to disapprove the rule.

"Nothing in the order explicitly authorized the EPA to act outside the statutory procedures set forth in the Clean Air Act," the ruling states. "The order simply permitted the EPA to conduct reconsideration proceedings on remand, and stayed the appeal pending completion of such reconsideration."

In affirming the 2008 revision, the court noted that opponents had failed to prove that Alabama would be incapable to detect violations and enforce visible emissions limits under the revised rule.

What's more, the opponents' challenge to the EPA approval of certain exemptions from the opacity rule is untimely because those exemptions won approval decades ago and have not changed in any way, according to the ruling.

The EPA is free to revise or correct the 2008 approval by following the procedures laid out in the Clean Air Act, the order adds.

U.S. District Judge Donald Molloy, sitting by designation from Montana, partially dissented. He said the EPA had clearly identified an error of judgment in its 2008 approval and that the agency had not complied with the Clean Air Act, which required it to ensure that the proposed revision would not interfere with any requirement concerning emissions limits.

Though the EPA did not use the specific words "error" or "correction," such omissions should not take away its right to reconsider the approval.

The agency properly concluded that an increase in opacity limits would interfere with standards for limiting emissions, Molloy added, saying the 2011 disapproval should stand.

What's more, the fact that the EPA reconsidered its decision after input from interested parties does not make its 2011 decision irrational or arbitrary, according to the dissent.

"As a result of the EPA's willingness to listen to these responses and consider additional data from interested parties before it made a final decision whether to change course, the majority concludes that the EPA exceeded its authority," Molloy wrote. "If this reasoning is correct, and I do not think it is, the lesson for the EPA is - declare errors first, and investigate whether they exist later. It has a 'verdict first, evidence later' feel to it."

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