United States Court of Appeals, District of Columbia Circuit
November 16, 2017
Petitions for Review of Final Action of the United States
Environmental Protection Agency
Charles McPhedran argued the cause for Conservation Group
petitioners. With him on the briefs were David S. Baron and
Timothy D. Ballo. Thomas Cmar and Abigail M. Dillen entered
W. Fichthorn, Aaron M. Flynn, Ken Paxton, Attorney General,
Office of the Attorney General for the State of Texas,
Priscilla M. Hubenak, Assistant Attorney General, Herman
Robinson, Donald Trahan, Dwana King, Jackie Marve, Spencer
Bowman, P. Stephen Gidiere, III, Thomas L. Casey, III, David
W. Mitchell, C. Frederick Beckner, III, Stephanie Z. Moore,
and Daniel J. Kelly were on the joint briefs for State and
Industry petitioners. Courtney Burdette, Charlotte Goudeau,
Peter D. Keisler, Elliott B. Vega, Mark L. Walters, Timothy
K. Webster, and Kathy M. Wright entered appearances.
L. Rave, Jr., Attorney, U.S. Department of Justice, argued
the cause and filed the brief for respondent. David A.
Carson, Senior Counsel, Jessica O'Donnell and Martin F.
McDermott, Attorneys, entered appearances.
Charles McPhedran argued the cause for Conservation Group
intervenor-respondents. With him on the briefs were David S.
Baron and Timothy D. Ballo. Thomas Cmar and Abigail M. Dillen
W. Fichthorn, Aaron M. Flynn, Curtis T. Hill, Jr., Attorney
General, Office of the Attorney General for the State of
Indiana, Thomas M. Fisher, Solicitor General, Margaret
Claiborne Campbell, Hahnah Williams, Renee Cipriano, J.
Michael Showalter, David M. Flannery, Kathy G. Beckett,
Edward L. Kropp, P. Stephen Gidiere, III, Thomas L. Casey,
III, David W. Mitchell, C. Frederick Beckner, III, Stephanie
Z. Moore, and Daniel J. Kelly were on the brief for State and
Industry intervenor-respondents. Peter D. Keisler, Byron W.
Kirkpatrick, and Timothy K. Webster entered appearances.
Before: Griffith and Pillard, Circuit Judges, and Williams,
Senior Circuit Judge.
WILLIAMS SENIOR CIRCUIT JUDGE.
7, 2012 the Environmental Protection Agency issued another
rule in a long succession of actions implementing
Congress's effort to restore air quality and visibility
in certain national parks and wilderness areas ("Class I
areas") to what they would be under natural conditions.
Regional Haze: Revisions to Provisions Governing Alternatives
to Source-Specific Best Available Retrofit Technology (BART)
Determinations, Limited SIP Disapprovals, and Federal
Implementation Plans, 77 Fed. Reg. 33, 642 (June 7, 2012)
("Final Rule"). In the rule, EPA took a
step in the implementation of its Cross-State Air Pollution
Rule, 76 Fed. Reg. 48, 208 (Aug. 8, 2011) ("CSAPR")
(pronounced by counsel as if the S and the A were reversed,
making it approximately "CASPER"). Specifically it
amended its Regional Haze Regulations and Guidelines for Best
Available Retrofit Technology (BART) Determinations, 70 Fed.
Reg. 39, 104 (July 6, 2005) ("Regional Haze Rule"),
to specify that CSAPR's requirements were stringent and
effective enough for it to serve as a better-than-BART
alternative for states participating in CSAPR, thus excusing
states from compliance with BART itself. 40 C.F.R. §
51.308(e)(2), (e)(4). In the Final Rule EPA also
disapproved portions of certain State Implementation Plans
("SIPs") designed to achieve reasonable progress
under the Regional Haze Rule because those plans relied on a
soon-to-be-defunct predecessor of CSAPR, the Clean Air
Interstate Rule, 70 Fed. Reg. 25, 162 (May 12, 2005)
("CAIR"). Instead, EPA promulgated Federal
Implementation Plans to address haze levels in the
disapproved states until those states could submit approvable
SIPs that relied on CSAPR (if those states were among those
eligible to rely on CSAPR) or otherwise demonstrated a local
alternative better than BART. 77 Fed. Reg. at 33, 653-54.
National Parks Conservation Association and the Sierra Club
("conservation petitioners") challenge the portion
of the Final Rule allowing states to treat CSAPR
compliance as a better-than-BART alternative. Multiple power
companies and the Utility Air Regulatory Group, as well as
the State of Texas and the Louisiana Department of
Environmental Quality ("state and industry
petitioners") challenge EPA's disapproval of SIPs
relying on CAIR as a better-than-BART alternative. Except to
the extent that the challenges are moot, we affirm EPA's
Regional Haze Rule requires states to impose best available
retrofit technology ("BART") on certain stationary
pollution sources-usually electric generation plants-
installed before August 1977. 40 C.F.R. §§ 51.301,
51.308(e)(1)(ii). The Rule allows states to pursue
alternative approaches, including EPA-approved regional
approaches to capping and trading emissions, to reduce haze
if those approaches meet EPA's regulatory definition of
being "better-than-BART." 40 C.F.R. §
51.308(e)(2); see Center for Energy and Economic
Development v. EPA, 398 F.3d 653, 660 (D.C. Cir. 2005)
("CEED") (affirming EPA's discretion
to approve regional alternatives to BART so long as the
discretion is "rationally exercise[d]"). In
Utility Air Regulatory Group v. EPA, 471 F.3d 1333,
1335 (D.C. Cir. 2006) ("UARG I"), we
affirmed EPA's finding that states could rely on CAIR as
a better-than-BART alternative against certain challenges
raised by industry and environmental petitioners. But in
response to a set of separate petitions by several states and
electric utilities we later found "more than several
fatal flaws" in CAIR itself, and because EPA had
"adopted the rule as one, integral action, " we
vacated and remanded the rule in its entirety. North
Carolina v. EPA, 531 F.3d 896, 901 (D.C. Cir. 2008)
("North Carolina I"). On rehearing, we
remanded CAIR to EPA without vacatur, convinced that,
"notwithstanding the relative flaws of CAIR, allowing
CAIR to remain in effect until it is replaced by a rule
consistent with our opinion would at least temporarily
preserve the environmental values covered by CAIR."
North Carolina v. EPA, 550 F.3d 1176, 1178 (D.C.
Cir. 2008) ("North Carolina II"). To
replace CAIR, EPA crafted and promulgated CSAPR, a revised
regional sulfur dioxide and nitrogen oxide emissions cap and
trading program. 76 Fed. Reg. at 48, 208. In a later
rulemaking, EPA determined, as it had for CAIR, that CSAPR is
an adequate better-than-BART alternative for participating
states. Final Rule, 77 Fed. Reg. at 33, 642.
review EPA's action to determine if it was
"arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with law, " or "in
excess of statutory jurisdiction, authority, or limitations,
or short of statutory right." The standard we apply is
the same under the judicial review provision of the Clean Air
Act, 42 U.S.C. § 7607(d)(9), as under the Administrative
Procedure Act, 5 U.S.C. § 706(2). Motor Vehicle
Manufacturers Ass'n v. EPA, 768 F.2d 385, 389 n.6
(D.C. Cir. 1985).
the conservation petitioners' arguments first. The
parties now agree that their first main challenge-that our
remand invalidating certain state emissions budges in EME
Homer City Generation, L.P. v. EPA, 795 F.3d 118 (D.C.
Cir. 2015), undercut the factual basis for EPA's finding
that CSAPR is better than BART-is moot. EPA has conducted a
fresh analysis of the better-than-BART issue in light of
EME Homer City and concluded that its changes to
CSAPR in response to the remand do not affect its
determination that CSAPR is a better-than-BART regional
alternative. See 82 Fed. Reg. 45, 481, ...