*fn1,UTILITY AIR REGULATORY GROUP, PETITIONER v. ENVIRONMENTAL PROTECTION AGENCY, ET AL.; AMERICAN CHEMISTRY COUNCIL, ET AL., PETITIONERS v. ENVIRONMENTAL PROTECTION AGENCY, ET AL.; ENERGY-INTENSIVE MANUFACTURERS WORKING GROUP ON GREENHOUSE GAS REGULATION, ET AL., PETITIONERS v. ENVIRONMENTAL PROTECTION AGENCY, ET AL.; SOUTHEASTERN LEGAL FOUNDATION, INC., ET AL., PETITIONERS v. ENVIRONMENTAL PROTECTION AGENCY, ET AL.; TEXAS, ET AL., PETITIONERS v. ENVIRONMENTAL PROTECTION AGENCY, ET AL.; AND CHAMBER OF COMMERCE OF THE UNITED STATES, ET AL., PETITIONERS v. ENVIRONMENTAL PROTECTION AGENCY, ET AL." />

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Utility Air Regulatory Group v. Environmental Protection Agency

United States Supreme Court

June 23, 2014

UTILITY AIR REGULATORY GROUP, PETITIONER
v.
ENVIRONMENTAL PROTECTION AGENCY, ET AL.; AMERICAN CHEMISTRY COUNCIL, ET AL., PETITIONERS
v.
ENVIRONMENTAL PROTECTION AGENCY, ET AL.; ENERGY-INTENSIVE MANUFACTURERS WORKING GROUP ON GREENHOUSE GAS REGULATION, ET AL., PETITIONERS
v.
ENVIRONMENTAL PROTECTION AGENCY, ET AL.; SOUTHEASTERN LEGAL FOUNDATION, INC., ET AL., PETITIONERS
v.
ENVIRONMENTAL PROTECTION AGENCY, ET AL.; TEXAS, ET AL., PETITIONERS
v.
ENVIRONMENTAL PROTECTION AGENCY, ET AL.; AND CHAMBER OF COMMERCE OF THE UNITED STATES, ET AL., PETITIONERS
v.
ENVIRONMENTAL PROTECTION AGENCY, ET AL

Argued February 24, 2014.[*]

[134 S.Ct. 2433] ON WRITS OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

Affirmed in part and reversed in part.

SYLLABUS

The Clean Air Act imposes permitting requirements on stationary sources, such as factories and powerplants. The Act's " Prevention of Significant Deterioration" (PSD) provisions make it unlawful to construct or modify a " major emitting facility" in " any area to which [the PSD program] applies" without a permit. § § 7475(a)(1), 7479(2)(C). A " major emitting facility" is a stationary source with the potential to emit 250 tons per year of " any air pollutant" (or 100 tons per year for certain types of sources). § 7479(1). Facilities seeking to qualify for a PSD permit must, inter alia, comply with emissions limitations that reflect the " best available control technology" (BACT) for " each pollutant subject to regulation under" the Act. § 7475(a)(4). In addition, Title V of the Act makes it unlawful to operate any " major source," wherever located, without a permit. § 7661a(a). A " major source" is a stationary source with the potential to emit 100 tons per year of " any air pollutant." § § 7661(2)(B), 7602(j).

In response to Massachusetts v. EPA, 549 U.S. 497, 127 S.Ct. 1438, 167 L.Ed.2d 248, EPA promulgated greenhouse-gas emission standards for new motor vehicles, and made stationary sources subject to the PSD program and Title V on the basis of their potential to emit greenhouse gases. It recognized, however, that requiring permits for all sources with greenhouse-gas emissions above the statutory thresholds would radically expand those programs and render them unadministrable. So EPA purported to " tailor" the programs to accommodate greenhouse gases by providing, among other things, that sources would not become newly subject to PSD or Title V permitting on the basis of their potential to emit greenhouse gases in amounts less than 100,000 tons per year.

Numerous parties, including several States, challenged EPA's actions in the D. C. Circuit, which dismissed some of the petitions for lack of jurisdiction and denied the remainder.

Held : The judgment is affirmed in part and reversed in part.

684 F.3d 102, 401 U.S.App. D.C. 306, affirmed in part and reversed in part.

JUSTICE SCALIA delivered the opinion of the Court with respect to Parts I and II, concluding:

1. The Act neither compels nor permits EPA to adopt an interpretation of the Act requiring a source to obtain a PSD or Title V permit on the sole basis of its potential greenhouse-gas emissions. Pp. 10-24.

(a) The Act does not compel EPA's interpretation. Massachusetts held that the Act-wide definition of " air pollutant" includes greenhouse gases, 549 U.S., at 529, 127 S.Ct. 1438, 167 L.Ed.2d 248, but where the term " air pollutant" appears in the Act's operative provisions, including the PSD and Title V permitting provisions, EPA has routinely given it a narrower, context-appropriate meaning. Massachusetts did not invalidate those longstanding constructions. The Act-wide definition is not a command to regulate, but a description of the universe of substances EPA may consider regulating under the Act's operative provisions. Though Congress's profligate use of " air pollutant" is not conducive to clarity, the presumption of consistent usage " 'readily yields'" to context, and a statutory term " may take on distinct characters from association with distinct statutory objects calling for different implementation strategies." Environmental Defense v. Duke Energy Corp., 549 U.S. 561, 574, 127 S.Ct. 1423, 167 L.Ed.2d 295. Pp. 10-16.

(b) Nor does the Act permit EPA's interpretation. Agencies empowered to resolve statutory ambiguities must operate " within the bounds of reasonable interpretation," Arlington v. FCC, 569 U.S. ___, ___, 133 S.Ct. 1863, 185 L.Ed.2d 941, 950. EPA has repeatedly acknowledged that applying the PSD and Title V permitting requirements to greenhouse gases would be inconsistent with the Act's structure and design. A review of the relevant statutory provisions leaves no doubt that the PSD program and Title V are designed to apply to, and cannot rationally be extended beyond, a relative handful of large sources capable of shouldering heavy substantive and procedural burdens. EPA's interpretation would also bring about an enormous and transformative expansion in EPA's regulatory authority without clear congressional authorization. FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 160, 120 S.Ct. 1291, 146 L.Ed.2d 121. Pp. 16-20.

(c) EPA lacked authority to " tailor" the Act's unambiguous numerical thresholds of 100 or 250 tons per year to accommodate its greenhouse-gas-inclusive interpretation of the permitting triggers. Agencies must always " 'give effect to the unambiguously expressed intent of Congress.'" National Assn. of Home Builders v. Defenders of Wildlife, 551 U.S. 644, 665, 127 S.Ct. 2518, 168 L.Ed.2d 467. The power to execute the laws does not include a power to revise clear statutory terms that turn out not to work in practice. Pp. 20-24.

2. EPA reasonably interpreted the Act to require sources that would need permits based on their emission of conventional pollutants to comply with BACT for greenhouse gases. Pp. 24-29.

(a) Concerns that BACT, which has traditionally been about end-of-stack controls, is fundamentally unsuited to greenhouse-gas regulation, which is more about energy use, are not unfounded. But an EPA guidance document states that BACT analysis should consider options other than energy efficiency, including " carbon capture and storage," which EPA contends is reasonably comparable to more traditional, end-of-stack BACT technologies. Moreover, assuming that BACT may be used to force improvements in energy efficiency, important limitations on BACT may work to mitigate concerns about " unbounded" regulatory authority. Pp. 24-27.

(b) EPA's decision to require BACT for greenhouse gases emitted by sources otherwise subject to PSD review is, as a general matter, a permissible interpretation of the statute under Chevron U.S. A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694. The specific phrasing of the BACT provision--which requires BACT " for each pollutant subject to regulation under" the Act, § 7475(a)(4)--does not suggest that the provision can bear a narrowing construction. And even if the text were not clear, applying BACT to greenhouse gases is not so disastrously unworkable, and need not result in such a dramatic expansion of agency authority, as to make EPA's interpretation unreasonable. Pp. 27-29.

Peter Keisler argued the cause for petitioner.

Donald B. Verrilli, Jr. argued the cause for respondents.

SCALIA, J., announced the judgment of the Court and delivered an opinion, Parts I and II of which were for the Court. ROBERTS, C. J., and KENNEDY, J., joined that opinion in full; THOMAS and ALITO, JJ., joined as to Parts I, II-A, and II-B-1; and GINSBURG, BREYER, SOTOMAYOR, and KAGAN, JJ., joined as to Part II-B-2. BREYER J., filed an opinion concurring in part and dissenting in part, in which GINSBURG, SOTOMAYOR, and KAGAN, JJ., joined. ALITO, J., filed an opinion concurring in part and dissenting in part, in which THOMAS, J., joined.

OPINION

[134 S.Ct. 2434] Justice Scalia announced the judgment of the Court and delivered the opinion of the Court with respect to Parts I and II.

Acting pursuant to the Clean Air Act, 69 Stat. 322, as amended, 42 U.S.C. § § 7401-7671q, the Environmental Protection Agency recently set standards for emissions of " greenhouse gases" (substances it believes contribute to " global climate change" ) from new motor vehicles. We must decide whether it was permissible for EPA to determine that its motor-vehicle greenhouse-gas regulations automatically triggered ...


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