West Virginia v. EPA

West Virginia v. EPA

Opinion

 [*864]  [**422]   SENTELLE, Circuit Judge: This is a petition for review of the Environmental Protection Agency's ("EPA" or "Agency") response to this Court's remands in Appalachian Power Co. v. EPA, 346 U.S. App. D.C. 38, 249 F.3d 1032 (D.C. Cir. 2001) ("Appalachian I"), and Appalachian Power Co. v. EPA, 346 U.S. App. D.C. 211, 251 F.3d 1026 (D.C. Cir. 2001) ("Appalachian II"). In those cases, we remanded the EPA's electric generating unit ("EGU") growth-factor determinations, which are used to develop Nitrogen Oxide ("NOx") emission limits for regulated states and EGUs. Petitioners - two states and several business and energy policy entities - raise multiple challenges to the Agency's Order on remand. Several states intervene in support of the EPA.

We hold that the EPA satisfied its obligation on remand [***4]  to engage in reasoned decisionmaking and explain its choice of methodology. The remaining claims are  [*865]   [**423]  not properly before this Court, as they were not raised at the time of the rulemaking or in the initial proceedings, and the EPA did not reopen these issues on remand. For these reasons, we deny the petitions.

I. Background

A. Regulatory Background

The Clean Air Act, 42 U.S.C. § 7401 et seq. (1994) ("CAA"), ] requires the EPA to identify air pollutants that endanger the public health, and to formulate National Ambient Air Quality Standards ("NAAQS") that specify the maximum permissible concentrations of those pollutants in the ambient air. Once the EPA has established NAAQS, each state must adopt a "state implementation plan" ("SIP") "providing for the implementation, maintenance, and enforcement of the NAAQS." Michigan v. EPA, 341 U.S. App. D.C. 306, 213 F.3d 663, 669 (D.C. Cir. 2000). Pursuant to the statute, the EPA has promulgated NAAQS for ozone, which is linked to multiple adverse health effects. See 40 C.F.R. pt. 50 (2003). Ozone, itself, is not emitted directly into the air; rather, it is formed from chemical reactions between NOx and volatile organic [***5]  compounds in the presence of sunlight. NOx is, therefore, a "precursor" of ozone. NOx is emitted primarily from fossil fuel combustion sources, including motor vehicles and power plants. Owing to the ability of NOx to move through the atmosphere, emissions of NOx in one area can result in ozone non-attainment in a distant area. Evidence in the record demonstrates that states in the eastern United States have difficulty attaining ozone standards because of ozone, or ozone precursor, emissions in upwind states. 64 Fed. Reg. 28,250, 28,253 (May 25, 1999). The two rules at issue in this petition deal with NOx exhaust limitations on upwind states and EGUs within their borders.

The first rule was based on the work of the Ozone Transport Assessment Group ("OTAG"). The OTAG was a national work group comprising 37 states, along with representatives of EPA, industry, and environmental groups, formed "to study and devise solutions to the interstate ozone transport problem." Michigan v. EPA, 213 F.3d at 672; see also 62 Fed. Reg. 60,296, 60,318 at 60,319. Based on OTAG's findings, EPA determined that NOx emissions from 23 jurisdictions were "contributing significantly"  [***6]  to non-attainment in downwind states in violation of the CAA. 42 U.S.C. § 7410(a)(2)(D)(i)(I). Accordingly, in October 1998, the EPA issued the NOx State Implementation Plans Call, which required 22 states and the District of Columbia to revise their SIPs to impose controls on NOx emissions. 63 Fed Reg. 57,356 (Oct. 27, 1998) ("NOx SIP Call"). Under the NOx SIP Call, each upwind state must limit its summertime NOx emissions to a statewide emissions "budget." "The budgets represent the amount of allowable NOx emissions remaining after a covered state prohibits the NOx amount contributing significantly to downwind non-attainment." Michigan v. EPA, 341 U.S. App. D.C. 306, 213 F.3d 663, 686 (D.C. Cir. 2000). Specifically, the NOx state budgets represent the EPA's projection for NOx emissions in 2007 for each state if highly cost-effective controls were implemented. "Highly cost-effective" is defined as those controls capable of removing NOx at a cost of $ 2,000 or less per ton. See Appalachian Power Co. v. EPA, 346 U.S. App. D.C. 211, 251 F.3d 1026, 1030 (D.C. Cir. 2001).

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