Home » Case Summaries » 2005 » Great Basin Mine Watch v. E.P.A.


Great Basin Mine Watch v. E.P.A.


Great Basin Mine Watch (Mine Watch) petitioned for review of a final rule[1] of the Environmental Protection Agency (EPA), which allowed Nevada to divide one of its air quality planning areas under the Clean Air Act (CAA).[2] The Ninth Circuit denied the petition because EPA did not act arbitrarily, capriciously, or contrary to law when it approved the division while relying on the determination that the Barrick Goldstrike Mine (Goldstrike), although a major emitter, was not subject to restrictions under the CAA’s program for the prevention of significant deterioration of air quality (PSD).

Under the CAA, states are divided into air quality planning areas (AQPAs) and under the EPA regulations for implementing the Act a state may request EPA to divide an AQPA.[3] EPA may grant the state’s request “on the basis of air quality data, planning and control considerations, or any other air quality-related considerations the Administrator deems appropriate,”[4] so long as the AQPA in question is not subject to restrictions under the PSD program.

The PSD program is designed to maintain relatively clean air where possible by limiting emissions in AQPAs that already have or possibly have low enough levels of air pollution to meet national air quality standards.[5] The PSD program operates by limiting the annual aggregate increase in emissions from all emitters major and minor within a single AQPA. However, the PSD program’s restrictions are only activated in an AQPA if an emitter within the AQPA submits an application for a permit to either build a new emissions source or make major modifications to a present source that would result in a major increase in emissions.[6] Upon the filing of such an application, EPA determines the baseline concentration of emissions in the AQPA and begins applying PSD restrictions to all emitters therein.[7]

EPA has broad discretion to divide an AQPA that is not already subject to PSD restrictions. EPA has much more limited discretion to divide an AQPA where PSD restrictions are in place and EPA hesitates to do so because such a division may result in more rapid deterioration of air quality.[8]

Nevada requested EPA to divide area 61 containing 550 square miles into two lesser AQPAs under the primary rationale that the two AQPAs would be more appropriate to local air transport processes, regional topography, and industrial development. Nevada claimed that any PSD restrictions that might interfere with the division had never been activated in area 61 even though area 61 included Goldstrike, a major emitter. Nevada explained that Goldstrike had not applied for a permit to either construct a new facility or to undertake major modifications to an existing facility and so never triggered the PSD program in area 61.[9]

EPA responded to Nevada’s request by issuing a proposed rule to grant the division on the basis of several justifications.[10] EPA determined that the change met the CAA’s statutory and regulatory requirements and that the change would not “interfere with Nevada’s management of air quality in the area. EPA also cited the agency’s policy of providing “states a fair degree of autonomy to balance air quality management with economic planning.”[11] EPA additionally noted that Goldstrike was a major source but was not subject to PSD restrictions so the AQPA division would neither interfere with a predetermined emissions baseline nor create a new AQPA limited to the area of impact around the PSD triggering major source. After soliciting public comment on the proposed rule and receiving criticism of the plan from several commentators including Mine Watch, EPA split area 61 in a final rule.[12]

The Ninth Circuit applied an arbitrary and capricious standard of review to EPA’s final agency action, stating that it would only overturn EPA’s final rule if it was arbitrary, capricious, contrary to law or beyond EPA’s statutory jurisdiction, authority or limitations.[13] The court first acknowledged that it would be possible for a major emitter to have never triggered the PSD program if either the major source was a major source before the PSD program became law or the major source had begun as a minor source that made permitless incremental modifications over time to become a major source. The court then reiterated that EPA had broad discretion to approve Nevada’s division of area 61 so long as Goldstrike had not activated the PSD program in area 61. The court concluded that Goldstrike had never done so even though it was a major emitter.

The court emphasized that the PSD program does not go into effect until the filing of a permit application to either construct a new major emitting facility or to modify a facility in such a way that its emissions of regulated pollutants increase significantly.[14] Mine Watch made four different arguments to support its claim that the PSD program did apply to Goldstrike. First Mine Watch argued that simply because Goldstrike was a major source the PSD program was active in area 61. This argument failed because there was no evidence in the record to indicate that Goldstrike was built as a major emitting facility after the date on which the PSD program became law, August 7, 1977.[15]

Mine Watch next argued that Goldstrike made a modification in 2001 that activated the PSD program in area 61 because it resulted in a significant increase of more than 40 tons-per-year (tpy), in nitrogen oxide emissions.[16] Mine Watch indicated that Goldstrike had initially reported its pre-modification nitrogen oxide emissions as 374.6 tpy and the post-modification level as 423.1 meaning that the modification resulted in an increase of 48.5 tpy and therefore triggered the PSD program. Goldstrike however contended that the initial 374.6 tpy figure was “a scrivener’s error” and that the true quantity of pre-modification emissions was 383.3 tpy, so that the modification only increased emissions by 39.8 tpy. EPA accepted the pre-modification emissions figure of 383.3 tpy and determined that the increase in nitrogen oxide emissions was therefore only 39.8 tpy, 0.2 tpy below the 40 tpy threshold that would trigger the federal permit requirement and subsequently the PSD restrictions. The court concluded that EPA’s reliance on these emissions figures was reasonable and supported by the record.

Mine Watch next argued that, over the course of 2001, Goldstrike had undertaken not only the modifications that resulted in a 39.8 tpy increase in nitrogen oxide emissions but also two other modifications that when combined with the first modification caused a significant increase in emissions of 42.9 tpy, thus triggering the PSD program. Mine Watch asserted that by submitting an operating permit application to Nevada in 2001, which grouped the three modifications together, Goldstrike effectively submitted a PSD permit application that combined the modifications. The court rejected this argument because the CAA “does not require the EPA to treat PSD permits and operating permits interchangeably.”[17] The court indicated that operating permits pertain to Title V of the CAA, which is completely separate from the PSD program and an operating permit therefore, does not necessarily double as a permit that triggers the PSD program.[18]

Lastly Mine Watch argued that the EPA practice of accumulation applied to the 2001 modifications so that the nitrogen oxide emissions caused by all of the modifications would be considered cumulatively. In 2001 EPA’s final rules provided that a major source’s increases in emissions be calculated cumulatively for the period “contemporaneous” with a modification.[19] “Contemporaneous” in this context was taken to mean within the preceding five years.[20] Mine Watch reasoned that the emissions of all three modifications made within the year 2001 should therefore be calculated in the aggregate.

The Ninth Circuit dismissed this argument however, first because Mine Watch did not raise the argument until submitting its reply brief, and second because EPA has since clarified its accumulation rule to say that emissions are not netted unless the contemporaneous modification is significant (i.e. resulted, in this case, to at least an increase of 40 tpy in nitrogen oxide emissions).[21] The court explained that even if the accumulation rule as it stood in 2001, applied to Goldstrike’s 2001 modifications and therefore provided cause to vacate EPA’s final rule dividing area 61, doing so would “serve no purpose.”[22] The court indicated that vacating and remanding to EPA because it did not apply the practice of accumulation would only lead to EPA applying the practice as it understands it now. That is to say that EPA would simply conclude that accumulation would not be appropriate because no single modification was in and of itself significant.

After determining that Goldstrike had never triggered the PSD restrictions in area 61 the court concluded that the EPA had acted within its broad discretion to approve the division of an AQPA where the PSD program was not in effect. The court reiterated that the record supported EPA’s determination that the division would better accommodate the region’s local air transport processes, industrial development and topography. The court closed by restating that EPA did not act arbitrarily or exceed its authority in issuing a final rule granting Nevada’s request to divide area 61.

In summary, the Ninth Circuit denied Mine Watch’s petition for review of EPA’s final rule dividing Nevada’s air quality protection area 61 because the rule was not arbitrary and capricious or contrary to law since to write the rule, EPA had acted within its broad discretion to divide AQPAs in which the PSD program has never been activated. The court determined that the record supported EPA’s understanding that the PSD program had never been activated in area 61 since the major source sitting in area 61, Goldstrike, had never triggered the PSD program by filing a permit application to construct a new facility or to undertake major modifications.

   [1] See 42 U.S.C. § 7607(b)(1) (2000).

[2] 42 U.S.C. §§ 7401-7671q (2000).

[3] 40 C.F.R. § 52.21(b)(14)(ii) (2005).

[4] 42 U.S.C. § 7407(d)(3)(A) (2000).

[5] Each AQPA is assigned a label based on air quality: nonattainment, meaning the air quality is below national standards; attainment, meaning the air quality meets national standards; and unclassifiable meaning it is unclear whether the air quality meets national standards. The PSD program only applies in AQPAs designated as nonattainment or unclassifiable. 42 U.S.C. §§ 7408-7409 (2000).

[6] 40 C.F.R. § 52.21(b)(14)(ii) (2000).

   [7] Id. § 52.21(b)(13), (14)(ii).

[8] EPA’s discretion to divide an AQPA is limited where the PSD program has been activated because a division raises questions of whether, for example, the PSD restrictions continue to apply in a newly designated AQPA if the major source that triggered the PSD in the old AQPA does not lie in that new AQPA. Other concerns are that the newly designated AQPA might “intersect or be smaller than the area of impact of any major stationary source or major modification.” 40 C.F.R §§ 51.166(b)(15)(ii), 52.21(b)(15)(ii) (2005).

[9] Designation of Areas for Air Quality Planning Purposes, 67 Fed. Reg. 21,194, 21,197 (Apr. 30, 2002).

[10] Id.

[11] Id.

[12] Designation of Areas for Air Quality Planning Purposes, 67 Fed. Reg. 68,769, 68,771, 68,776 (Nov. 13, 2002) (to be codified at 40 C.F.R. pt. 81).

[13] Exxon Mobil Corp. v. U.S. Envtl. Prot. Agency, 217 F.3d 1246, 1248 (9th Cir. 2000).

[14] Alaska Dep’t of Envtl. Conservation v. U.S. Envtl. Prot. Agency, 540 U.S. 461, 472 (2004).

[15] 42 U.S.C. § 7457(a)(1) (2000).

[16] 40 C.F.R. § 51.21(b)(23), (40) (2005).

[17] Great Basin Mine Watch v. U.S. Envtl. Prot. Agency, 401 F.3d 1094, 1099 (9th Cir. 2005).

[18] 42 U.S.C. §§ 7661-7661f (2000).

[19] The regulations in 2001 stated that a “‘major modification’ means any physical change in . . . a major stationary source that would result in a significant net emissions increase of [nitrogen oxides].” 40 C.F.R. § 52.21 (b(2)(I) (2002).

[20] Requirements for Preparation, Adoption, and Submittal of Implementation Plans, 45 Fed. Reg. 52676, 52701-02 (Aug. 7, 1980).

[21] The regulations now state that a “‘major modification’ means any physical change . . . that would result in: a significant emissions increase [of nitrogen oxides]; and a significant net emissions increase of that pollutant from the major stationary source.” 40 C.F.R. § 52.21(b)(2)(I) (2005).

[22] Great Basin Mine Watch, 401 F.3d at 1100..

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