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Third Circuit Confirms EPA’s Approval of Pennsylvania’s Air Pollution Plan

On July 25, 2023, a Third Circuit panel rejected an environmental group’s challenge of federally approved changes to Pennsylvania’s State Implementation Plan (“SIP”),  holding that the Environmental Protection Agency (“EPA”) emissions-based analysis did not violate the Clean Air Act (“CAA”). Ctr. for Biological Diversity v. U.S. Env’t Prot. Agency, 2023 WL 471884, at *6 (3d Cir. 2023). The panel’s reasoning focused on a close statutory reading of §7410 of the CAA, which prevents EPA from approving any SIP revision that would “interfere with any applicable requirement for attainment and reasonable further progress” in reaching the National Ambient Air Quality Standards (“NAAQS”). Id. at *4. NAAQS are air quality benchmarks that each state must work toward by reducing their air pollution levels. Id. at *1. Ultimately, the Third Circuit held that Pennsylvania’s revisions did not interfere with NAAQS attainment because Pennsylvania reasonably concluded that emissions would likely decrease under the source specific requirements imposed by the revised plan. Id. at *4.

The CAA directs EPA to set standards and periodically revise the NAAQS for certain pollutants. Id. at *1. Although EPA sets the NAAQS, each state is afforded discretion in the development of its SIP to achieve EPA’s targets for the reduction of air pollutants. Id. EPA will only approve the SIP or a revision to a SIP after ensuring that it meets CAA requirements. Id. In 2016, Pennsylvania submitted a SIP to satisfy the state’s Reasonably Available Control Technology (“RACT”) planning requirements for VOC and NOx.  Id. The SIP included a presumptive provision, which is a default emission limitation for certain types of stationary emission sources, and a source-specific RACT provision available to sources unable to achieve the presumptive RACT limits. Id. EPA approved the default RACT requirements, but only conditionally approved the source-specific RACT provisions, requiring  Pennsylvania to submit further information on specific sources. Id. Pennsylvania then proposed RACT variances to seventeen major VOC and NOx  emitting facilities and submitted them as revisions to the SIP. Id. As Pennsylvania’s SIP awaited final approval, the Center for Biological Diversity (“Plaintiff”) submitted several comments objecting to the variances. Id.  

Despite the Plaintiff’s objections, EPA approved the revisions in two separate rules. Id.  The first rule approved the facility-specific RACT determinations at eight major VOC and NOx  emitting facilities. Id. The second rule contained facility-specific RACT determinations for nine additional facilities. Id. EPA approved both rules noting that none of the seventeen variances in the revised SIP would increase emissions when compared to the emissions in the prior SIP. Id. The Plaintiff’s submitted a petition for reconsideration for the first rule arguing that the EPA erred when it concluded that certain of the source-specific RACT requirements did not increase emissions, ultimately in violation of the CAA. Id. at *3.The reconsideration remains pending before EPA, and the Plaintiff’s brought suit to review both rules included in Pennsylvania’s SIP revisions. Id.

The Third Circuit panel began its opinion by stating that it must uphold EPA’s SIP approval unless it is arbitrary, capricious or an abuse of discretion. Id. The Plaintiff’s objected to EPA’s approval on two specific grounds:  (1) EPA’s decision to approve the SIP  was inappropriately based on an emission-only analysis instead of an examination of air quality more generally; and (2) in the alternative, that even if the CAA allowed EPA to focus exclusively on emissions, EPA wrongly concluded that Pennsylvania’s SIP revisions would not increase emissions. Id. In evaluating these arguments, the court reasoned that the language of §7410 restricts its reach to SIP revisions that “interfere with” NAAQS attainment, an analysis that will differ depending on the scope of the specific changes to the SIP. Id. Here, EPA’s approval of the source-specific RACT provisions that limit the emissions from certain pollution sources did not “interfere with” NAAQS attainment, but instead aided those efforts. Id. Therefore, the court concluded that  EPA was not required to conduct a comprehensive air quality analysis, as argued by the Plaintiff, if there is no evidence that other non-emissions factors will be changed by a particular SIP revision. Id.

The Third Circuit also rejected the Plaintiff’s second argument that EPA acted arbitrarily and capriciously by concluding that the SIP revisions did not increase emissions. Id. Specifically, the Plaintiff’s argued that EPA should have compared the RACT facility-specific source emissions in the revised SIP to the RACT default standards, and that the control technologies approved in the revised SIP emit NOx pollutants leading to increased emissions. Id. The court rejected the first argument, holding that the clear language of the RACT provisions explicitly state that a source can only propose facility-specific RACT standards if it cannot meet the default standards. Id. at *6. Thus, it would make little sense to compare RACT facility-specific standards to default RACT standards. Id. The Plaintiff’s second argument that EPA approved Pennsylvania's SIP even though it actually increases NOx pollution in some cases, was rejected by the panel on procedural grounds. Id. Specifically, the Plaintiff’s failed to raise this argument with “reasonable specificity” in earlier comments as mandated by Section 307(d) of the CAA. Id. Thus, the Third Circuit Court held that EPA rightfully approved Pennsylvania’s air pollution plan with the emissions-based analysis. Id. at *7. This holding reaffirms that courts will closely read the language of the CAA to determine if SIP revisions truly interfere with NAAQS attainment in each state. See id. at *4.