Judges Grill EPA Over Trading Scheme to Meet Ozone Air Limits

Sept. 22, 2020, 6:01 PM

A trio of federal appeals court judges questioned the EPA on Tuesday about whether it gave undue flexibility to localities that are struggling to meet current air quality standards for ozone.

Judges David S. Tatel, Gregory G. Katsas, and Harry T. Edwards asked Justice Department attorney Perry S. Rosen to explain how the Environmental Protection Agency could justify its 2018 rule that allows states to use a trading program to offset sources of ozone-forming pollution in areas violating federal ozone limits.

Tuesday’s oral arguments at the U.S. Court of Appeals for the District of Columbia Circuit focused on a challenge from a coalition of environmental groups, led by the Sierra Club, to the 2018 rule. The groups say the EPA can’t allow localities to trade one ozone-forming pollutant, like nitrogen oxide, to offset increased emissions of volatile organic compounds, or VOCs, another ozone-forming pollutant.

Both volatile organic compounds and nitrogen oxides are byproducts of fossil fuel combustion and react in sunlight to form ground-level ozone, a chief component of smog linked with exacerbating respiratory and cardiac problems.

Katsas picked up on the coalition’s contention that the EPA’s rule departed from the plain language of the Clean Air Act, which requires cuts in volatile organic compounds to offset increases in emissions driven by expanding or constructing polluting sources such as power plants or refineries.

He asked Rosen to explain whether the EPA’s position is that “such air pollutant” in the Clean Air Act refers not to VOCs, but to ozone, “in a very complex statute where ten sections is probably twenty pages of text.”

Ozone, Not Precursors

The EPA has countered that the Clean Air Act’s goal is to limit ozone pollution, not its precursors, and said the law is referring to ozone, and not VOCs, when it talks about offsetting an increase in “such a pollutant.”

Rosen, the Justice Department attorney, said Tuesday that the relevant statute was written in two parts, but at different times. The second part of the law refers back to offsets, which states new facilities must offset emissions of “an air pollutant.” That language allows the EPA to define either nitrogen oxides or VOCs as a precursor of an air pollutant, he said.

But Tatel interrupted Rosen’s explanation to point out that EPA’s goal can only be achieved by “disregarding” the plain language of this statutory provision.

When Rosen began to disagree, Tatel delivered a lesson in English grammar: “Did you have to diagram sentences in school?” he asked.

No Excuses

Earthjustice attorney Seth Johnson, who represented the Sierra Club-led coalition of environmental groups, told the judges that the only excuse EPA could provide for overriding the text of the Clean Air Act is that the provisions in question were written at different times.

“From a textual matter it makes no difference, and from a factual matter it was wrong,” Johnson told Bloomberg Law after the arguments.

The judges also grilled Johnson about the coalition’s claim that the EPA was giving undue flexibility to localities in choosing a year as a baseline to measure emissions reductions. Edwards questioned why it was a problem that the EPA gave localities a choice of which year to use to use as a starting point.

“It’s a very hard argument for me to digest,” Edwards said.

The Sierra Club-led coalition also includes Downwinders at Risk, the Conservation Law Foundation, Physicians for Social Responsibility-Los Angeles, and the National Parks Conservation Association.

The Sierra Club has received funding from Bloomberg Philanthropies, the charitable organization founded by Michael Bloomberg. Bloomberg Law is operated by entities controlled by Michael Bloomberg.

The case is Sierra Club v. EPA, D.C. Cir., No. 15-01465, oral arguments 9/22/20.

To contact the reporter on this story: Amena H. Saiyid in Washington at asaiyid@bloombergindustry.com

To contact the editor responsible for this story: Anna Yukhananov at ayukhananov@bloombergindustry.com

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