Griffin Bell

“ To summarize, petitioners and the EPA differ as to the model which determines how great a reduction in hydrocarbon emissions is necessary, and also as to how effective in achieving the required reductions particular measures will be. In general, the state's calculations indicate that the ambient air quality standards can be attained in each AQCR through its Regulation V, imposing extensive controls on stationary sources, such as factories and refineries. ”

“ That it would be inappropriate to require such approval as an absolute rule is suggested by the fact that even an approved implementation plan as contemplated in subsection (e) provides only for theoretical attainment of the standard, not attainment in fact. Second, to require another submittal from Texas would be pointless, for Texas' original plan, its request for an extension, and its brief all make it abundantly clear that in meeting the standard Texas wishes to rely as heavily as it can on the effects of federal control of automotive emissions. ”

“ These pollutants, which can cause breathing difficulties and eye irritation, derive their name from the process by which they are formed, to wit, oxidation reactions triggered by sunlight and involving nitrogen oxide, hydrocarbons and atmospheric oxygen. Since sunlight and oxygen can't be controlled, and nitrogen oxide is difficult to control, strategies aimed at photochemical oxidants rely on control of hydrocarbon emissions. These emissions occur during the production, storage, transportation and use of a variety of petroleum products. ”

“ Petitioner Exxon has pressed arguments based upon three facts related to the agency's ozone measurement procedures: (1) that different techniques for measuring photo -chemical oxidant pollution yield, in certain circumstances, widely varying results; (2) that the standard of.08 ppm is not altered for areas which record high background levels of ozone; and (3) that reduction requirements are based on oxidant pollution levels which occur during air stagnation episodes. While the parties present arguments on the merits of these attacks, we need not reach them. ”

“ The Petroleum Refining Reactive Inventory As in the case of chemical processing the EPA derived its refining reactive inventory by applying a reactivity factor to an original, presumably total, hydrocarbon inventory. However, we need only deal with the first element of this procedure to determine that the agency must reconsider this portion of its Texas calculations, for we have concluded that the agency's choice of reactivity factors was arbitrary and capricious. ”

“ The agency denies that there is any inconsistency by explaining that Texas refinery emissions include little gasoline, and that most are low-reactivity emissions from refinery feed stock and products other than gasoline. According to the EPA, the low gasoline content is due to the fact that in Texas gasoline evaporation is already kept at a minimum by the use of storage tanks with floating roofs which raise or lower to accommodate the expansion or contraction of gasoline vapors. ”

“ This model is essentially a method of coping with inadequate information by assuming that reductions in oxidant pollutants will be proportional to reductions in reactive hydrocarbon emissions. The agency does not contend that the model is an accurate representation of reality, but it does contend that there is no information to support divergences from it, either in the direction of higher reduction requirements, as with Appendix J and part of the Texas curve, see note 14 infra, or in the direction of lower reduction requirements, as in the case of most of the Texas curve. ”

“ The problem arises in determining the reactive component of total hydrocarbon emissions from each emission category. In general, the agency has determined that reactive hydrocarbons constitute a smaller percentage of total stationary source emissions than has the state, and thus that stationary sources are responsible for a smaller percentage of overall reactive emissions. For example, in Region 7 the EPA calculates that 294,000 tons per year of reactive hydrocarbons are emitted from stationary sources, and 106,000 tons per year from mobile sources. ”

“ For one, we take judicial notice of the facts that this is a period in which investment capital is scarce and inflationary pressures are severe. In addition, not only are we currently experiencing a variety of raw material shortages, but the particular control devices necessary to comply with the vapor recovery regulations are themselves in short supply -- indeed, other Texas regions have for this reason been granted an extension until 1976 for implementing vapor recovery. ”

“ Since it is only reactive hydrocarbons which contribute to oxidant pollution, the Texas approach is theoretically attractive. However, reactive hydrocarbons have not yet been the subject of extensive pollution control study, and the resulting lack of knowledge restricts the usefulness of reactive hydrocarbon pollution control plans. One important unknown is the configuration of the appropriate reduction model. ”

“ The automobile refueling vapor recovery regulation requires, for Region 7, 90 per cent recovery of hydrocarbon vapors. While the regulation itself does not specify, the agency has stated that this goal must be attained for each and every vehicle filled (save for certain types of vehicles which are not compatible with standard control equipment) . ”

“ Deviations from this assumption are to be permitted or required only when supported by empirical data or sound theory. Such a stance is not arbitrary and capricious, and is readily accepted by Texas for maximum oxidant concentrations above about.28 ppm (as discussed in note 14 supra, for these high pollution levels the EPA permits states to abandon Appendix J and use the much less stringent straight rollback model; it does so not only to avoid disruptive reduction requirements, but also because no solid data relates oxidants and hydrocarbon emissions for these high levels) . ”

“ Second, in the instance of two carbon black plants total hydrocarbon data was eliminated because it was known to be methane. These reductions, which amount to only 11,000 tons, are offered in the second memo as the explanation for the statement in Document 30 that a 0.6 reactivity factor was used because the inventory "was adjusted to eliminate obvious methane sources." Since our review is for the purpose of determining whether an agency determination is arbitrary or capricious, we are constrained to consider the EPA's post hoc statements. ”

“ The agency's principal counter to petitioners' cost objections is the carbon adsorption system. It considers this system to be only somewhat more expensive than the simple, but less effective, displacement [p316] system. [47] The agency's technical support document does bolster the proposition that initial capital outlay is not a great deal more ($5,065 versus $6,900 per station for existing stations) . Document 30, Part II, pp. 5-6 through 5-9. However, at page 5-9 we are told that the cost effectiveness for the simple system is $0.19 per lb. of vapor recovered and 0.14 cents per gal. ”

“ Especially is this relevant when we recognize that at several key points in developing the promulgated regulations the agency accounted for the uncertain quality of its data by imposing less stringent requirements than the data might support. For example, the reactivity factor used for chemical processing emissions was.6 rather than.47 or.52, and the agency is satisfied with a 75 per cent target in Houston rather than the much higher target that is suggested by the nonmethane data on which Appendix J is based. ”

“ They also contend that control technology is not available and will not be during the short time allotted for implementation of the requirement. Finally, they allege discrimination in that the Houston-Galveston area has been singled out among all American ports for these emission controls and their possible adverse effect on the use of ports in the region. ”

“ Region 9 (San Antonio) Calculations based on a.65 reactivity factor increase the Texas plan's 1977 reductions by 2.6 per cent. The EPA's transportation regulations (52.2293-94, 52.2296-97) are designed to obtain a 4.1 per cent reduction. [41] We thus defer the effective date of these controls pending agency reconsideration. The remaining regulations, all of which deal with direct emission sources, need not be deferred. ”

“ A. In rejecting Texas' reduction model the agency pointed out defects which have not adequately been answered on this appeal. Initially, for all practical purposes the state supplied no theoretical or empirical support for its novel model. [11] Upon further inquiry, the EPA learned that the state had modified Appendix J [12] by grasping upon the fact [p299] that no reliable data exists connecting hydrocarbon emissions and relatively low maximum levels of oxidant pollution (below.13 ppm but above the national standard of.08 ppm) . ”

“ Certain petitioners have submitted a motion to strike various portions of the record. In particular, their motion is directed at the agency's technical support Documents 30 and 31, which were compiled and made available only after the regulations were promulgated. If these documents contained new data which was not available when the agency made its determinations, the motion would have merit. However, these documents are statements of agency methodology and compilations of information which was in the record when the determinations were made. ”

“ This latter requirement precludes reliance on techniques which could meet the 90 per cent goal on an average basis, but not for every vehicle. According to petitioners the effect is to require the use of more complex, expensive and hazardous equipment.
The agency has not contested that its regulation will likely require the more complex techniques. It does contend that a complex system exists which (1) is virtually ready for on-line use, (2) is safe, and (3) is not excessively expensive. ”

“ THE DISPUTE IN OUTLINE Determining the measures required to meet air quality standards for photochemical oxidants involves a multi-step analytical process. Initially, of course, it is necessary to set the standards. ”

“ Overton Park similarly dealt with review of agency action which was based upon neither an adjudicatory hearing nor the rulemaking provision of the Administrative Procedure Act, 5 U.S.C.A. § 553. [7] Likewise, the statute authorizing review did not specify the scope of review. In these circumstances the Court turned to the generally applicable paragraphs of section 706 of the Administrative Procedure Act, 5 U.S.C.A. § 706, characterizing these as requiring "the reviewing court to engage in a substantial inquiry." 401 U.S. at 415, 91 S.C.t. ”

“ The twelfth region was included in Texas' plan, but was not dealt with in the agency action here under review. The omission occurred because that AQCR also encompasses southern Louisiana, and actions concerning it were delayed until the EPA could consider Louisiana's plan.↑ The national ambient air standard for photochemical oxidants is expressed as 0.08 parts per million (ppm) of ozone, this being a maximum one-hour concentration not to be exceeded in more than one hour a year. ”

“ The record reveals that at least the following objections to the.12 factor were made before the agency: (1) that the Los Angeles study was outdated, being based on 1955-58 data and preceding both significant changes in refinery [p309] technology and considerable additional emissions inventory research; (2) that Texas refineries have a product mix different from those on the west coast, and are more heavily oriented toward highly reactive substances ”

“ While subsection (e) is principally aimed at cushioning states against unreasonable measures when the controls they impose cannot be fully effective until after 1975, we think it properly applicable to the kindred situation presented here -- that in which the post-1975 reductions are accomplished by control measures or other factors independent of the state's own plan.↑ 38 Fed. Reg. 30635, 30638, 30640 (Nov. 6, 1973) .↑ Both systems are designed to capture vapors displaced from vehicle tanks during refilling. ”

“ I. THE SCOPE OF REVIEW While the parties do not seriously dispute the basic standard of review, we think it wise for us to state that standard before applying it to the issues before us. The statute provides for review by the appellate courts of the agency's actions with respect to a state's implementation plan, 42 U.S.C.A. § 1857h-5 (b) (1) (1974 Supp.) , but does not specify the standard of review. In this situation courts have been applying the standard set forth in Citizens to Preserve Overton Park v. ”