Special Topics in Environmental Management

2015 Ozone Primary NAAQS Upheld by D.C. Circuit

Two challenges filed from opposite directions against the EPA’s 2015 primary or health-based National Ambient Air Quality Standards (NAAQS) for Ozone were denied by a panel of the U.S. Court of Appeals for the D.C. Circuit. At one end, environmental and health advocacy groups argued that the standard was insufficiently protective of children. At the other end, industry and state petitioners said the standard was too stringent and not adequately justified by the science the EPA presented.

Relying on recommendations the EPA’s Clean Air Scientific Advisory Committee (CASAC) made on revising the previous (2008) ozone NAAQS, the panel found that the Agency acted within those recommendations and reasonably amended the primary standard.

However, the court also agreed with environmental petitioners that the Agency’s 2015 amendments to the secondary or welfare ozone NAAQS veered without sufficient explanation from several CASAC recommendations; accordingly, the court remanded the secondary standard to the EPA for reconsideration. Also, the court agreed with environmental petitioners that a grandfathering provision the Agency included in the 2015 amendments had no basis in the Clean Air Act (CAA); the panel vacated that provision.

While neither side succeeded in forcing a revision of the 2015 primary standard, the outcome of the case (Murray Energy Corporation v. EPA)places a burden on states and industry, which will need to do more to attain the standard.

Following are highlights of the D.C. Circuit’s 50-page opinion.

Primary NAAQS

In the 2015 NAAQS, the EPA lowered the primary and secondary standards, both set in 2008 at 0.075 parts per million (ppm), to 0.70 ppm ozone. The Agency set the form—that is, how compliance is measured—based on the 3-year average of the fourth-highest daily maximum 8-hour concentration; this is the same form used in the 2008 NAAQS. In its report, the CASAC had recommended a primary level between 0.06 ppm and 0.07 ppm.

According to state and industry petitioners, the EPA did not provide sufficient justification to lower the 2008 NAAQS. For example, industry argued that the EPA made use of one study that did not support its finding of adverse effects.

Environmental petitioners claimed that the EPA’s use of a 3-year-average form impermissibly allows people to be exposed to concentrations above 0.70 ppm.

The court noted that the 0.70 ppm standard set by the Agency was within the recommended CASAC range. Also, responding to industry’s contention that the EPA had no cause to amend the standard because it relied on the same information it used to promulgate 2008 NAAQS, the court pointed out that the Agency referenced 400 scientific studies that were published after the 2008 NAAQS were issued.

Regarding environmental petitioners’ complaint about the 3-year average, the panel accepted the EPA explanation that this form would eliminate occasions on which school-age children experience two or more exposures of concern at ozone concentrations at and above 0.08 ppm and, even in the worst-case years and locations, would “virtually eliminate” the occasions on which such children experience two or more exposures of concern at 0.07 ppm.

Hence, all challenges to the primary ozone NAAQS and its form were denied.

Secondary NAAQS

According to environmental petitioners, in setting the secondary NAAQS, the EPA arbitrarily used a 3-year average rather than the single-year, cumulative measurement of ozone exposure the CASAC recommended as a benchmark to gauge the protectiveness of the standard. The petitioners also claimed that the EPA deviated without explanation from the CASAC’s recommendation on an acceptable level of tree loss resulting from ozone pollution. In addition, the petitioners claimed, the Agency unreasonably failed to identify a level of air quality requisite to set a standard that provided sufficient protection against visible leaf injury.

The court agreed that the EPA had not demonstrated how its chosen 3-year average benchmark protects against “unusually damaging years that will be obscured in the average.” But the court disagreed that the Agency deviated from the CASAC’s recommendation regarding tree loss, which environmental petitioners placed at 2 percent. However, that percentage was a recommendation by the CASAC, said the court, which added that the Agency adequately explained its reason for setting a standard that would keep tree loss under 6 percent. Also, the court agreed that the EPA erred by not explaining why it did not specify a level of air quality to protect against adverse welfare effects from ozone-induced visible leaf injury.

The court remanded the secondary standard to the Agency for “further explanation and reconsideration.”

Economic Impact and Background Ozone

Industry and state petitioners argued that the EPA was required by law but failed to consider the “overall adverse economic, social, and energy impacts” of the revised NAAQS. According to petitioners, the CAA instructs the Agency to evaluate the “appropriateness” of the new standards, and “appropriateness” must include economic considerations. Petitioners cited an important case (Michigan v. EPA, 2015) wherein the U.S. Supreme Court stated that it was appropriate that the regulation of hazardous air pollutants from power plants include some consideration of cost.

The D.C. Circuit panel responded that the CAA unambiguously bars cost considerations from the NAAQS-setting process. Furthermore, the panel wrote that Michigan involved a different provision of the CAA, and the Supreme Court was careful to emphasize that its reading of “appropriate” was dependent on the statutory context.

Petitioners noted that the CAA states that the NAAQS must be attainable. They argued that in some areas of the country, background ozone levels are so high, it will not be possible to come into attainment with the revised NAAQS.

“The text of the Act forecloses this argument,” responded the panel. “Section 109(b) directs EPA to set NAAQS ‘requisite to protect the public health’ and ‘the public welfare.’ Accepting Petitioners’ argument would mean that, if the level of background ozone in any part of the country exceeds the level of ozone that is ‘requisite to protect the public health,’ EPA must set the NAAQS at the higher, unhealthy level.”

In addition, the panel said the CAA gave the EPA the authority to relax enforcement of the NAAQS on a case-by-case basis when events beyond a state’s control resulted in nonattainment. Also, the Agency’s exceptional event regulations may allow a state to avoid a nonattainment designation.

Both industry and state petitions were denied.

Grandfathering

The EPA’s amendments allowed those who completed applications for Prevention of Significant Deterioration (PSD) preconstruction permits before the 2015 rule was adopted to demonstrate compliance with the previous NAAQS rather than the new, more stringent standards. The Agency explained that absent this grandfathering provision, permitting authorities would be unable to meet their CAA obligation to issue PSD permits within 1 year of the filing of a completed application.

Environmental petitioners argued that the CAA requires permit applicants to demonstrate compliance with any NAAQS, regardless of when their application was completed.

The panel said the EPA’s reasoning for allowing the provision was misplaced because the CAA does not require that a permit be issued within 1 year. It requires only that the permitting authority grant or deny completed permit applications within 1 year.

“If a permit applicant has not shown that it can meet the new NAAQS, EPA or a state permitting authority can comply with the timeliness requirement of section 165(c) by denying the application,” stated the panel.

Based on this interpretation, the court vacated the EPA’s grandfathering provision.