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Case number 22-1271 et al.

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United States Sugar Corporation petitioner versus environmental protection agency.

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May it please the court, I have Tim Bishop representing US Sugar Corporation.

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At council table with me is Shannon Broom, who represents the other industrial petitioners in the case.

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The first issue here is whether EPA may impose new source emission standards that are proposed in 2020 and finalized in 2022 on boilers that were designed and built years earlier going back to 2010.

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And section 7412A4 of the Clean Air Act defines a new source as one that began construction, quote, after EPA first proposes regulations,

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establishing animation standard applicable to such source.

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Now, EPA says that that definition is ambiguous.

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It can mean the first time that EPA proposes any standard for the source category, the first time it proposes a standard under a particular rulemaking record, the first time it

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poses a particular standard.

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And it says that ambiguity leaves it with discretion to pick and choose among those meanings in a particular rulemaking.

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We don't think EPA has that discretion.

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And we think that because other provisions of the statute, the structure of the statute, and EPA's own prior explanations of the purpose of the new source rule show that new source emission standards are not intended to apply

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already constructed sources.

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And let me begin by telling you what EPA has said previously about why the statute should be read to mean only a particular regulation.

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New sources come normally by a particular regulation.

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Before you get to EPA's positions, can we just start with text?

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Yes.

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And one feature of the text that might cut against you is we have this scheme which contemplates regulations being promulgated and re-promulgated and getting stricter over time.

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And we have the verb establish running throughout the statute, which has some connotation of doing something on the front end of things.

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And then we have the verb revise used to denote the amendments as the regulations grow increasingly stringent.

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So in the context of that sort of scheme,

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Can't you read established to mean the first regulation and then everything after it is a revision?

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Well, I don't think the structure of the statute, I've got a number of points to take off, but I don't think the structure of the statute lends itself to that reading.

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Once a

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Once a standard is established, the revision process is governed by D6 and F2, these regular risk reviews that occur at a minimum every eight years.

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When those are conducted, there's no question for either existing orphan use forces, there's no question

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that those rules are perspective only.

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That's all EPA has ever done.

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Those are perspective only.

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They're perspective, but they're revisions and therefore they might not be

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Well, you know, what EPA is trying to do here is to use the fact of the remand, and not even the remand in U.S.

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sugar, but a remand that they asked for in U.S.

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sugar that went back to NACWA that was three years ago.

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They're using the remand here to really contort

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the process which is that you have a standard and then it's revised and that standard applies to new sources after the proposal but all the revisions after that apply prospectively only.

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It's really extraordinary to use the remand in this case that

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It's nothing to do with US sugar, but NACWA is something that they threw in at the end of that litigation to say, well, three years ago, this court required in a different rule setting, required that we approach these issues this way.

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We haven't done that yet.

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So we'd like you and sugar to remand on the NACWA issue.

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And now, 10 years later,

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They're saying, well, we're going to apply these new source standards back based on that remand.

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That's an extraordinary use of the remand process in a way that we think contradicts the entire structure of the statute, which is about revisions being prospective.

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And that's in section 111-2.

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In section 111, the parallel provision that deals with existing sources

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Those standards are prospective only.

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And the RTR revisions that come under B6 and F3 are prospective only.

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So really, EPA is just using the rebound here to push back 10 years after all of these folks have invested huge amounts of money complying with the 2013 standards to say, no, you've got to retrofit.

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And what EPA said in the Portland cement

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case we think makes very good sense.

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And I think the strength of EPA's reasoning is more important these days than Chevron, which may be about to disappear.

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So if you look at the strength of EPA's reasoning... Can I give you a hypothetical?

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Imagine there had been no history, no previous proposals, no previous rules.

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And in 2020, EPA had proposed a standard.

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Notice and comment happens.

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In 2021, you build a boiler.

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And then in 2022, the final promulgated rule is slightly stricter than what was proposed.

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Would you be a new boiler subject to the slightly stricter proposal?

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Is this where the three-year kind of like leeway would kick in?

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Yeah, Judge Walker.

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And we do think that that provision that deals with that, which is 741 to I2, is important here.

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It's telling, because that's a special rule.

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But if you build after a proposal, then

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the standard becomes more stringent in the final, Congress said that you have time to comply.

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You have the three years to comply.

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We think that if Congress had envisaged that that would not just be a one-off situation from the proposal and then the final getting more stringent.

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But if that, as EPA says, was gonna be continuous, they were gonna keep looking back to

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at the very first proposal that it would have said so.

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It would have given Boiler's time to comply.

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It didn't.

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It only gave them time to comply when there is a proposal, a final rule that's more stringent.

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And everyone agrees that that provision does not apply in this case.

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So we think that that's one of the

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one of the textual and structural issues here that is very telling.

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So is your position that even if the statute is ambiguous and even if we're still bound by Chevron, this is an unreasonable interpretation and so we owe no deference to it and we should vacate the rule based on that?

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Yes, it's an unreasonable interpretation.

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We think that when you look at it, when you look at the language of the definition that EPA has said is ambiguous, when you look at it in the context that's text and the structure of the statute and provisions like I2, it's clear that Congress was only talking about the particular rule and not, as EPA says, being able to look back to prior proposals.

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And here is what

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as EPA said in the 2006 Port Enforcement Rule, it said, quote, the whole premise of new source standards being more strict than for existing sources is that newly constructed sources can immediately install the best pollution controls without the time or expense of retrofitting.

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And it went on, if we were to require new sources to retroactively install controls because we have changed the rule requirements,

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they would have to bear retrofit costs.

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And US sugar here will face more than $20 million in retrofit costs.

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And EPA said, we do not believe that those retrofit costs were intended by the Clean Air Act.

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And it said that we cite a litany of rules in our brief where EPA is likewise.

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If we agree with you about issue one, do we need to rule on issue two?

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That's a good question, Judge Walker.

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I think if you rule for us on issue one, that will reinstate the 2013 standards and so the HCL standard that they're relying on would be gone.

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So strictly you don't.

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But on the other hand, EPA has, I don't think there's any reason

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at the moment to think that they would change their mind.

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We've commented on how they came up with the HCL standard.

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They have... You have... Assuming everything you just said is correct, and the only boilers that you've told us you have, boiler number nine and the biomass boilers... Yes, the 10 boilers in total were affected.

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Right.

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And they were all begun to be built.

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before 2020, right?

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Yes.

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So I'm not sure, there's a question, not a statement, but would you have standing to challenge the prospective application of the rule proposed in 2020 and promulgated in 2022?

[00:11:32] Speaker 04:
On the HCL, I don't think have initial we would have standing.

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Given where we are in the litigation, I don't think it would be improper for this court to offer some guidance to EPA.

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We think there's clear, what EPA should have done on the HCL is to explain itself.

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And it hasn't done that.

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This court, although it gives a great deal of deference,

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to EPA on statistical issues.

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Do you want us to give the guidance if the guidance says we think EPA was fine?

[00:12:09] Speaker 04:
No, but that's, you know, EPA has to explain itself and it hasn't done that.

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It clearly has not done that.

[00:12:16] Speaker 06:
Related question.

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If you were to prevail on the new source definition, but nothing else, then wouldn't a proper

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remedy be a partial vacature of just that part of the rule?

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As to the, I believe it's, yes, the part of the rules that apply going back to 2010, which affects just these 10 boilers.

[00:12:49] Speaker 06:
That's just a definition.

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That's just what you contend to be the erroneous definition of a new source.

[00:12:56] Speaker 04:
Yes, yes, because those are the only affected boilers here.

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I'd like to...

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The definition is what you're suggesting?

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I think vacate the definition.

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Why not just prohibit enforcement as applied to your clients?

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Or you could prohibit enforcement.

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I think that would be an alternative to reach the same result.

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I mean, everyone who built after 2020 knows that they have to comply with the 2022

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rule I mean that's that's unproblematic so the only affected part is here the 10 boilers the bill between 2010 and um and 2020 the petition is here I can reserve the rest of my what if the remedy was this um we vacate the any part of the rule that apply the 2022 standard

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to boilers that had begun to be built before 2020.

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Yes.

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Now, that would be, rather than just your clients, that would be universal vacator, which I think is our practice.

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So I'm curious to hear if DOJ will push back against that, as they have been in some recent cases.

[00:14:25] Speaker 00:
Thank you.

[00:14:35] Speaker 01:
Good morning, Harry Rosen for the United States.

[00:14:38] Speaker 01:
Let's look at this, the key statute here, this key statutory provision, Section 7412A-4, which is the definition of a new source.

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Applying it to the facts of this case, EPA first proposed regulations under this section establishing an emission standard for boilers in 2010.

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That's a reasonable interpretation of that provision.

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There may be other interpretations of that provision.

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But that's reasonable.

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And it's consistent with the way Congress wrote the statute.

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First of all, this definition differs from the definition of new source and other provisions, such as Section 7411, the new source performance standards.

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There, a new source is one described or defined as one created after the publication of regulations.

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That's very different than the definition here.

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Secondly, the Congress changed the definition

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This is a very purposeful definition.

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Before 1990, the statute applied to the administrator proposes regulation under this section establishing an emission standard.

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In 1990, they put in the word first.

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It had to be a very purposeful change.

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when EPA first proposes an emission standard.

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That's how you define a new source.

[00:16:03] Speaker 06:
And that's- So how does it work if EPA revises these standards in 2028?

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And there's a boiler that's already been constructed, a new source.

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because this standard is applicable to that source?

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The 2028 standard is applicable to that source?

[00:16:30] Speaker 01:
It would depend on the context of the revisions.

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If the revisions to the standards that EPA has made are subject to a technology review, for instance, or vacature, where EPA collects all new data and creates all new emissions standards.

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What does that have to do with the language in the statute?

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I mean, this qualification that you're putting on it, I don't see how that's connected to the statutory text at all.

[00:17:01] Speaker 01:
I think EPA's interpretation of first proposes is when it is based in large part on the collection of data and the creation of a whole set of standards.

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In that case, as EPA has done in the past, it's interpreted first proposed there as a new date.

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So new sources would be defined differently.

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What if in this case, everything were the same?

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The whole history was the same.

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But I'm going to change one thing.

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EPA had used a new data set when it came up with the 2020 proposal.

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then would you still be arguing what you're arguing here that the boiler number nine is a new boiler?

[00:17:52] Speaker 01:
I'm not going to avoid that question.

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It would depend on all of the circumstances, but as a general matter, no.

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If it was a whole new data set, at least consistent with EPA's practice in the past, it has then redefined the date for a new source.

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I mean, this is Judge Wilkins' question again, but I just don't see how

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Whether there's a new data set or an old data set, that turns an existing boiler into a new boiler or a new boiler into an existing boiler.

[00:18:23] Speaker 02:
And the statute doesn't talk about data sets at all with regard to what's new and what's old.

[00:18:28] Speaker 01:
The statute doesn't.

[00:18:30] Speaker 01:
But again, in 2013, EPA explained how the first proposed can apply to different situations.

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And those situations included your hypothetical here.

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You're trying to get some mileage out of the remand without vacatur aspect of this case.

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Because, I mean, if you say that

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You want to apply this definition to 2028 rulemaking or the 2035 rulemaking or the 2042 rulemaking.

[00:19:09] Speaker 05:
I mean, it just gets ridiculous.

[00:19:11] Speaker 05:
So what's different about remand without vector?

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It's still a different standard.

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formulated through notice and comment rulemaking prospectively applied.

[00:19:33] Speaker 05:
You've made a choice not to reopen the data set, but what does that have to do with anything?

[00:19:39] Speaker 01:
We agree it can get or suddenly appear ridiculous as the years go on.

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But in our view here, we're acting pursuant to a very limited remit here.

[00:19:51] Speaker 05:
The rulemaking is 50 pages long.

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It changes dozens of standards.

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It accounts for NACWA as well as the instructions here.

[00:20:06] Speaker 05:
It does all sorts of things besides just adjusting the numbers.

[00:20:13] Speaker 01:
Yes, it does.

[00:20:15] Speaker 01:
But if we, again,

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It was limited to just the errors identified by this court.

[00:20:23] Speaker 01:
It's based on, again, the same data set, which petitioners in their inter-reina brief in the next case argue it should be based on.

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What if instead of happening in 2020, the proposal, for whatever reason, maybe losing court a few more times, and maybe there's some delays, and now all these things take time, maybe whatever.

[00:20:48] Speaker 02:
Imagine we're a court and we're considering a proposal that's made in 2110, 100 years after the 2010 proposal.

[00:21:02] Speaker 02:
Would you still be saying that this spoiler number nine is forever young, still new, even though 100 years have passed?

[00:21:15] Speaker 01:
We'd be hard-pressed to say that in that situation.

[00:21:18] Speaker 01:
We'd certainly agree with that.

[00:21:20] Speaker 02:
OK.

[00:21:21] Speaker 02:
So where in the statute is that line drawn?

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And my next question is going to be, where is the line that you're drawing?

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Is it 50 years?

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Is it 40 years?

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Is it 30 years?

[00:21:34] Speaker 01:
There's nothing explicitly in the statute.

[00:21:37] Speaker 01:
We'd agree with that.

[00:21:39] Speaker 01:
Our view, as EPA stated in 2013, is that the statute is ambiguous.

[00:21:44] Speaker 01:
And in different situations, it would be applied differently.

[00:21:49] Speaker 01:
The way EPA views this and the way it has viewed it over the years, including in the 2013 Portland cement rule, which is that if it's a limited situation, remand reconsideration limited to just a specific issue or a couple of specific issues.

[00:22:08] Speaker 02:
So is there a scenario where the boiler number nine would

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be a new boiler relative to a 2110 proposed standard?

[00:22:20] Speaker 01:
Again, to try and predict the future.

[00:22:24] Speaker 01:
If EPA is possible.

[00:22:25] Speaker 01:
Yes, it's possible.

[00:22:27] Speaker 01:
But in our view, that would typically occur.

[00:22:29] Speaker 02:
I think that's quite a hard argument to agree to.

[00:22:36] Speaker 06:
Fair enough.

[00:22:38] Speaker 06:
How do you harmonize your

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interpretation of new source with 112 I in the stuff compliance deadlines in the way that that works.

[00:22:55] Speaker 01:
Our view is that that provision is limited to it's a compliance or reporting type of provision.

[00:23:02] Speaker 01:
And that is different than defining a new source.

[00:23:05] Speaker 01:
It includes the term new source there and reports, for instance, that if you're building a new source, you have to comply with existing regulations.

[00:23:14] Speaker 01:
Well, that makes sense.

[00:23:15] Speaker 01:
To get approval to move forward, you have to comply.

[00:23:18] Speaker 01:
But that is not a license that says you will not be subject to change requirements.

[00:23:24] Speaker 01:
EPA and federal agencies change requirements all the time.

[00:23:28] Speaker 01:
That's why this provision is not, as petitioners assert, impermissibly retroactive.

[00:23:34] Speaker 01:
It doesn't punish the past behavior.

[00:23:37] Speaker 01:
It just says you're in the future you'll be subject to.

[00:23:40] Speaker 06:
Then what work does the definition of existing source do?

[00:23:45] Speaker 01:
I'm sorry?

[00:23:45] Speaker 06:
Then what work does the definition of existing source do?

[00:23:52] Speaker 01:
It continues to apply to

[00:23:54] Speaker 01:
existing sources that the existing source standard is a different standard.

[00:23:59] Speaker 06:
It applies to the top 12% instead of what I'm saying is is that how does anything ever become an existing source?

[00:24:13] Speaker 01:
Or in I would say in two ways that in Congress originally set down its marker and said once you

[00:24:24] Speaker 01:
that it defined new sources and existing sources, and it basically said that once EPA sets out the standards for a particular subcategory and anything constructed after that is a new source, as EPA said in 2010, in 2013, and again in 2022, it could become a new source if EPA makes the determination through a technology review, a vacatur, or something else, that it has to start all over again.

[00:24:55] Speaker 01:
new data and create new emission standards.

[00:24:58] Speaker 01:
Just as it did in this case because EPA originally generated the requirements in 2004 and that was vacated by this court in 2007.

[00:25:09] Speaker 01:
Vacature basically wipes things off the slate and you start all over again.

[00:25:15] Speaker 02:
Can I see if I'm understanding one part of your argument?

[00:25:18] Speaker 02:
You tell me if I've got it wrong or not.

[00:25:21] Speaker 02:
It seems like you're saying that a new source built after a proposal gets, in that case, it gets extra time to comply under I-2.

[00:25:31] Speaker 02:
But a new source built before a proposal does not get extra time to comply, at least not by statute.

[00:25:44] Speaker 01:
I would not say that it would depend on what the proposal is.

[00:25:48] Speaker 01:
If the proposal is a proposed rule to respond to a limited directed remand of this court, then that would be the case.

[00:25:57] Speaker 01:
Right.

[00:25:57] Speaker 02:
And why are you giving boiler number nine the extra three years?

[00:26:03] Speaker 02:
I know you say the statute doesn't require it.

[00:26:06] Speaker 02:
You're kind of doing it out of the goodness of your heart.

[00:26:10] Speaker 02:
But your argument on the equities

[00:26:14] Speaker 02:
I think is, look, after 2010, they were on notice.

[00:26:20] Speaker 02:
So they rolled the dice.

[00:26:22] Speaker 02:
They took a risk.

[00:26:24] Speaker 02:
They knew that they might be building a boiler that would not comply with the standard that was coming down the road.

[00:26:31] Speaker 02:
And so to the extent they're saying that calling them a new boiler is unfair, I mean, they made their bed.

[00:26:37] Speaker 02:
Too bad, so sad.

[00:26:38] Speaker 02:
If all that's true, then why are you giving them the extra three years?

[00:26:42] Speaker 01:
I think that's consistent with the Weld County case, where the court explained that if something is imposed but gives the entity no time to comply with the requirements, then it becomes unfair.

[00:27:01] Speaker 01:
So EPA gave the same time period it generally gives under the statute in other situations of three years.

[00:27:08] Speaker 01:
I guess.

[00:27:08] Speaker 02:
I'm glad that you're giving them the extra three years.

[00:27:13] Speaker 02:
I think the logic of your argument is they really shouldn't have built the boiler in the first place, because they were on notice there might be a stricter standard.

[00:27:25] Speaker 01:
That is correct.

[00:27:28] Speaker 01:
They were on notice in 2013 that EPA took the view, took this view.

[00:27:34] Speaker 01:
They were on notice that things would change in 2016 decision, and they proceeded at their own risk

[00:27:42] Speaker 02:
Now you're sort of rewarding them for doing what you say they shouldn't have done, giving them the extra three years that you don't by law.

[00:27:51] Speaker 01:
I'm not sure it's a reward, but EPA was trying to be reasonable, at least on the compliance.

[00:27:56] Speaker 01:
If I could just go ahead.

[00:27:59] Speaker 05:
They were on notice about the

[00:28:02] Speaker 05:
2010 standard proposed standard that became the major boiler rule in 2013.

[00:28:10] Speaker 05:
They weren't on notice that seven years later the standard would become a hundred times more stringent.

[00:28:18] Speaker 01:
They they were they were not on notice about what this court would rule in 2016 and how it would direct EPA to change this.

[00:28:26] Speaker 05:
What future standards you would promulgate whether

[00:28:30] Speaker 05:
directed through a remand without vacatur or on the next eight-year iteration?

[00:28:39] Speaker 01:
That's correct, but standards get changed all the time under the various environmental statutes.

[00:28:45] Speaker 01:
and has explained the retroactivity cases.

[00:28:48] Speaker 05:
They do, and I mean, I don't think there's a primary retroactivity problem for reasons you lay out in your brief, but there is this scheme which on an ongoing basis just bakes in this distinction between new and existing.

[00:29:07] Speaker 01:
We believe it goes back to Congress's intent.

[00:29:09] Speaker 01:
This statute has a long history.

[00:29:12] Speaker 01:
EPA spent years trying to regulate this area, and Congress threw up its hands and said, we have to get serious and strict about this.

[00:29:20] Speaker 01:
And it set out the standards.

[00:29:22] Speaker 01:
It defined a new source.

[00:29:24] Speaker 01:
And under that definition of new source, we think it meets that.

[00:29:28] Speaker 06:
Can I ask you a question?

[00:29:32] Speaker 06:
Incinerators are governed by 7429.

[00:29:34] Speaker 06:
Correct.

[00:29:35] Speaker 06:
And there's a provision there that says,

[00:29:41] Speaker 06:
that those standards are to be reviewed every five years.

[00:29:47] Speaker 06:
How does it work there when those standards are revised five years later with respect to compliance for incinerators that had already been constructed or were in the process of being constructed previously?

[00:30:11] Speaker 01:
I can't say exactly to that, but I believe that 7429 does not include the same first proposed language that 7412.

[00:30:20] Speaker 06:
I think that's right.

[00:30:21] Speaker 06:
It doesn't say first proposed, right?

[00:30:25] Speaker 01:
And I think that's the difference here.

[00:30:32] Speaker 06:
I guess.

[00:30:34] Speaker 06:
But if we take first proposed literally.

[00:30:39] Speaker 06:
I just don't know how.

[00:30:42] Speaker 06:
You know, once there is a standard that is applicable to, you know, a class of boilers, how it ever becomes not new, because when you revise in the future, whatever this new standard is, is going to be applicable

[00:31:07] Speaker 06:
And if first proposed just relates back to the first standard that was applicable to that boiler, then it just seems that every, your boiler is always gonna be a new boiler for every subsequent standard that is applicable to that boiler, regardless of whether it's a new notice and comment or new data or whatever.

[00:31:34] Speaker 06:
I mean, it just seems like if we just,

[00:31:37] Speaker 06:
If we just look at the plain text, it supports you, but it creates, I think, an absurd result.

[00:31:49] Speaker 01:
Well, as a general matter, until the absurd result part, we agree with you because that's the Congress took that purposeful step to put in the first proposed language to basically say anything built after the date of

[00:32:06] Speaker 01:
first proposal for a given subcategory, you're on notice that you'd be considered a new facility, a new regulated entity.

[00:32:17] Speaker 02:
Well, now I'm not sure I understand, because let's say you win this case, and then in 10 years or 20 years, you do a post new standard with a new data set, notice and comment, and you finalize it, you promulgate that new standard.

[00:32:36] Speaker 02:
Is boiler number nine a new boiler?

[00:32:39] Speaker 01:
Under the history of how EPA has acted in other situations and other rulemakings, probably not, no.

[00:32:46] Speaker 02:
And is that history consistent with your argument in this case?

[00:32:49] Speaker 02:
We believe it is, yes.

[00:32:51] Speaker 02:
OK, so under your argument in this case, why is boiler number nine not a new boiler with respect to a new standard 20 years from now?

[00:33:04] Speaker 01:
Because in the scenario you gave me, it was a new collection of data processed.

[00:33:11] Speaker 01:
We think that's a key distinction here.

[00:33:13] Speaker 02:
I thought your discussion with Judge Wilkins suggested that the first proposed, the first time that a standard was proposed was 2010.

[00:33:24] Speaker 02:
I actually think it was actually 2003.

[00:33:29] Speaker 02:
If first proposed is much if first proposed means what you say first proposed means then.

[00:33:37] Speaker 02:
Why?

[00:33:39] Speaker 02:
Wouldn't.

[00:33:42] Speaker 02:
Boiler number 9 BA news boiler.

[00:33:47] Speaker 02:
Relative to a 2030.

[00:33:50] Speaker 02:
New proposal.

[00:33:52] Speaker 02:
new data sets, new notice and comment, final promulgation.

[00:33:57] Speaker 01:
As EPA explained, the term first proposed is ambiguous, and it's ambiguous depending on the situation in which it's applied.

[00:34:06] Speaker 01:
And consistent with how it's acted on other rule makers, in your scenario, it would be treated, the first proposed would not date back to two months.

[00:34:18] Speaker 02:
OK, and I think there's a line in your brief that says, although you think you win under Chevron, you don't need Chevron.

[00:34:25] Speaker 02:
So if the Supreme Court overrules Chevron this term, then is the argument you just made no longer an argument that can work?

[00:34:38] Speaker 01:
Well, it would obviously depend on how the Supreme Court overrules Chevron.

[00:34:44] Speaker 06:
Your position would be either that we would say it's unambiguous in your favor or that it's the best interpretation, even if we give you no definite.

[00:34:55] Speaker 01:
Probably the latter.

[00:34:58] Speaker 02:
Because you just said it was ambiguous.

[00:34:59] Speaker 01:
Yes.

[00:34:59] Speaker 01:
And EPA has said that.

[00:35:03] Speaker 02:
Your opposing counsel

[00:35:04] Speaker 02:
kind of walked through the EPA statement in 2006.

[00:35:07] Speaker 02:
And I know you don't agree entirely with how that statement applies today.

[00:35:13] Speaker 02:
But I thought I'd give you a chance.

[00:35:15] Speaker 02:
I think it has three sentences.

[00:35:16] Speaker 02:
And after each sentence, it lets you say whether that was correct when they said it or whether it was correct when they said it but doesn't apply here for some reason.

[00:35:29] Speaker 02:
You can give the reason.

[00:35:30] Speaker 02:
Or whether it was incorrect when they said it.

[00:35:32] Speaker 02:
The first thing EPA said in 2006

[00:35:35] Speaker 02:
The whole premise of new source standards being potentially more strict than for existing sources is that these sources are being newly constructed and hence can immediately install the best pollution control without incurring the time or expense of retrofitting.

[00:35:50] Speaker 02:
So was that a correct statement?

[00:35:52] Speaker 01:
That was a correct statement.

[00:35:54] Speaker 02:
And then put another way, new sources know from the beginning of the construction effort what controls will be required and do not have to incur the higher costs and the time consuming disruptions normally associated with control retrofits.

[00:36:08] Speaker 02:
That's great.

[00:36:09] Speaker 02:
If we were to require new sources that commenced construction prior to, in bracket, 2005, to retroactively install controls because we have changed the rule requirements, then these particular sources would have to bear retrofit costs that we do not believe were intended by the Clean Air Act.

[00:36:29] Speaker 02:
Also correct?

[00:36:30] Speaker 01:
It's also correct.

[00:36:31] Speaker 02:
So doesn't that describe the exact situation that confronts the source owners?

[00:36:36] Speaker 02:
I'll give you a chance.

[00:36:37] Speaker 02:
What's the difference?

[00:36:38] Speaker 01:
Again, it goes back to how a new source is defined.

[00:36:43] Speaker 01:
And if in the context of just correcting the errors that EPA made, according to this court, in existing regulations, based on the original set of data, which again, petitioners say is what should be applied.

[00:37:00] Speaker 01:
I mean, petitioners wanted both

[00:37:03] Speaker 01:
They want all of the standards to be revised based on the 2013 data set, but they don't want to be defined as the new source.

[00:37:14] Speaker 02:
Just to take one phrase from what you said is still correct.

[00:37:18] Speaker 02:
New sources know from the beginning of the construction effort what controls would be required.

[00:37:22] Speaker 02:
Do you think that boiler number nine's owners knew what controls would be required when they built it?

[00:37:30] Speaker 02:
They knew the existing controls.

[00:37:31] Speaker 02:
They didn't know the 2022 revisions.

[00:37:34] Speaker 02:
And you said that the 2022 revisions control, right?

[00:37:39] Speaker 02:
Yes.

[00:37:40] Speaker 02:
So they did not know what controls would be required.

[00:37:48] Speaker 02:
They did not know at that time.

[00:37:52] Speaker 02:
That seems very inconsistent with EPA's 2006 statement, which you endorsed a few minutes ago saying,

[00:37:59] Speaker 02:
new sources know from the beginning of the construction effort what controls will be required.

[00:38:06] Speaker 01:
That is consistent.

[00:38:07] Speaker 01:
But again, it goes back to what you consider a new source.

[00:38:11] Speaker 01:
I mean, all those statements do apply to a new source as you define it coming later in time.

[00:38:25] Speaker ?:
Okay.

[00:38:27] Speaker 00:
All right.

[00:38:27] Speaker 01:
Thank you.

[00:38:28] Speaker 01:
Thank you.

[00:38:42] Speaker 06:
Mr. Pugh.

[00:38:43] Speaker 03:
Good morning.

[00:38:45] Speaker 03:
Contrary to industry's claim, the special definition of new source that Congress enacted for Section 112 cannot be read to mean something different than it says.

[00:38:55] Speaker 03:
And contrary to EPA's claim, it is not ambiguous.

[00:39:00] Speaker 03:
Section 112A4

[00:39:01] Speaker 03:
Expressly defines a new source as one for which construction commences after EPA first proposes an emission standard that is applicable to the source.

[00:39:10] Speaker 03:
EPA can propose a standard and emission standard for the first time only once.

[00:39:17] Speaker 03:
this court.

[00:39:18] Speaker 02:
EPA's answer to well what about a standard on a boiler that's proposed 100 years from now and whether boiler number nine would be new relative to it.

[00:39:28] Speaker 02:
EPA said possibly but I think you would say definitely.

[00:39:33] Speaker 03:
Well, I would say yes.

[00:39:34] Speaker 03:
I realize it's hypothetical.

[00:39:37] Speaker 03:
The boiler wouldn't exist 100 years from now.

[00:39:38] Speaker 03:
I mean, the useful life of the boiler is a lot shorter than that.

[00:39:41] Speaker 03:
But yeah, under the law, yes, that's the right answer.

[00:39:44] Speaker 03:
As to your question about the absurd results possibility, I don't think there's anything absurd about this.

[00:39:50] Speaker 03:
Congress wanted very strict standards.

[00:39:52] Speaker 03:
And the only difference between new source standards and existing source standards are that new source standards are more stringent.

[00:39:58] Speaker 03:
No one, not even the industry petitioners, is claiming that they are impossible to meet.

[00:40:03] Speaker 03:
In fact, as EPA pointed out in the record, more than 70% of the new sources are meeting the standard in question.

[00:40:10] Speaker 02:
Petitioners say it'll cost them $20 million just to fix boiler number nine.

[00:40:16] Speaker 03:
Their cost complaints are irrelevant under the statute.

[00:40:18] Speaker 03:
This is under the statutory floor provision, which doesn't consider costs.

[00:40:21] Speaker 03:
I know they don't like it, but it doesn't change what Congress defined a new source as.

[00:40:26] Speaker 03:
But you said it's feasible, and I guess... It certainly is feasible.

[00:40:30] Speaker 03:
$20 million a lot of things feasible.

[00:40:33] Speaker 03:
It wouldn't be feasible for me, but it is certainly feasible for US sugar.

[00:40:38] Speaker 05:
What's wrong with, there's a statutory definition here, right?

[00:40:46] Speaker 05:
The 2010 rule established a standard for hydrogen chloride.

[00:40:54] Speaker 05:
I don't know what it is.

[00:40:55] Speaker 05:
Let's just call it X, okay?

[00:40:58] Speaker 05:
But in 2020, EPA proposes a standard

[00:41:06] Speaker 05:
different standard for hydrogen chloride, which is 100 X right.

[00:41:11] Speaker 05:
So you go to the statute and ask what is the when did EPA first propose regulations.

[00:41:21] Speaker 05:
Establishing the 100 X standard.

[00:41:25] Speaker 05:
Your honor, that's like a perfectly natural way of describing what's going on here.

[00:41:33] Speaker 05:
The revised standard, it's a revision, but it still establishes a new standard first proposed whenever that NPRM goes out.

[00:41:44] Speaker 03:
Your honor, I think if the statute referred to the standard, that interpretation might be correct, but it refers to an omission standard.

[00:41:52] Speaker 03:
And as this court and the Supreme Court have both held, Congress's use of articles is- 100X is an omission standard.

[00:42:00] Speaker 03:
Well, it was first proposed in 2020.

[00:42:03] Speaker 03:
But an emission standard was first proposed in 2010.

[00:42:07] Speaker 03:
If it were that particular standard, the 100x emission standard, it would be different.

[00:42:11] Speaker 03:
But the statute speaks about an emission standard.

[00:42:14] Speaker 03:
In Otonio, the case this court just decided, Otonio versus the United States, this court just decided last year in 2023.

[00:42:25] Speaker 03:
held, and this is not controversial, that when Congress uses the indefinite article, an, it's referring to any one.

[00:42:31] Speaker 03:
And that's in contrast to Congress's, I'm sorry, yeah, to the legislature's use of the definite article, the.

[00:42:38] Speaker 03:
Industry would like to interpret the, this language is referring to the particular standard, but that's not what the statute says.

[00:42:46] Speaker 03:
In fact, I would say that Congress's amendment of this provision in the 1990 amendments to

[00:42:53] Speaker 03:
refer to first proposes and emissions standard, would have no effect whatsoever given the reading that industry wants.

[00:43:03] Speaker 03:
And as the Supreme Court dealt in the Intel case in 2020, when a legislature amends a statute, courts presume that it intends to change to have a real and substantial effect.

[00:43:14] Speaker 03:
Under industry's interpretation of this statute, adding the word first before proposes would accomplish nothing.

[00:43:23] Speaker 06:
So let's suppose you're right.

[00:43:28] Speaker 06:
So the way that the existing source standard or statute is written, you look at the, I guess, the best performing 12% of existing sources.

[00:43:48] Speaker 06:
And so over time, these boilers are gonna become more efficient, et cetera, at least that's the hope, so that the best performing 12% today is gonna be different than the best performing 12% 10 years from now.

[00:44:12] Speaker 06:
Right.

[00:44:13] Speaker 06:
So that if EPA gathers new data 10 years from now and then promulgates a new standard there, then existing sources are going to have to improve and maybe have to do some retrofitting, et cetera, to meet this new existing source.

[00:44:37] Speaker 06:
standard.

[00:44:39] Speaker 06:
And that's part of the other thing that's going on here is that you want new data to be used wherever it's available.

[00:44:55] Speaker 06:
But if your definition of new source is correct, then when would we ever need an existing source standard?

[00:45:07] Speaker 06:
Or when would having that standard have any sort of effect?

[00:45:13] Speaker 03:
Well, the statute defines an existing source as one that's not new.

[00:45:16] Speaker 03:
And it defines one that's new as one that's built after first proposal.

[00:45:20] Speaker 03:
So an existing source is one that's built for the first proposal.

[00:45:23] Speaker 06:
So what I'm saying is that once there is a proposed regulation that is applicable to a class of boilers,

[00:45:39] Speaker 06:
then it would seem that any under your definition and your construction of this definition, any boiler that is constructed at any time in the future that fits within that class is considered to be a new source, right?

[00:46:03] Speaker 06:
Yes.

[00:46:06] Speaker 06:
So once you have

[00:46:09] Speaker 06:
Once EPA has kind of established or first proposed something that ends up getting promulgated and approved and withstands all the court challenges, et cetera, that is applicable to a class of boilers, every new revised regulation that applies to that same class of boiler,

[00:46:39] Speaker 06:
um gets um gets treated to you know the boilers that have already been constructed as if they are new sources right yes rather than existing sources yes and i just don't understand how um so basically the existing source regulation and definition only does any work um for

[00:47:09] Speaker 06:
the boilers that were constructed before the very first regulation is proposed for that class of boilers?

[00:47:22] Speaker 03:
Yes, that's our interpretation.

[00:47:25] Speaker 03:
There is a universe of boilers that are built before that first proposal.

[00:47:31] Speaker 03:
They're existing.

[00:47:32] Speaker 03:
They'll always be existing.

[00:47:34] Speaker 03:
Other sources that are built after that proposal are new, and they'll always be new.

[00:47:39] Speaker 03:
This is not a, I mean.

[00:47:41] Speaker 06:
How does that, how does that comport with just ordinary understanding of the word do?

[00:47:47] Speaker 03:
I'm glad you asked that.

[00:47:48] Speaker 06:
Because I'd love to become new.

[00:47:52] Speaker 03:
Your honor, I don't think it accords with the ordinary understanding, but as the Supreme Court held intense and where there is an explicit statutory definition, courts follow that definition, even if it varies from the terms ordinary meaning.

[00:48:04] Speaker 03:
We're not claiming this is the ordinary meaning that is the divine meaning.

[00:48:09] Speaker 03:
This court is at a very high bar for overriding the plain text of a statute.

[00:48:15] Speaker 05:
The party that wants to overwrite... The court's also said you can look to the plain meaning of the defined term if the definition is ambiguous.

[00:48:24] Speaker 03:
But the definition is not ambiguous.

[00:48:25] Speaker 03:
I'm glad you asked that, Your Honor, because we disagree... Well, then we're back to...

[00:48:29] Speaker 05:
We're back to the question I asked you at the beginning of how you understand an emission standard.

[00:48:35] Speaker 05:
You say it means any old emission standard that's ever applied to the source.

[00:48:43] Speaker 05:
That's right.

[00:48:44] Speaker 05:
I get that, but that leads me to think, you know, any old emission standard includes the 2020 one.

[00:48:51] Speaker 05:
Oh, no, Your Honor.

[00:48:52] Speaker 05:
I asked that question about 2020, no less than 2020.

[00:48:57] Speaker 03:
23 sorry 2010 your honor what I what I'm trying to say is that that and has to be read together with first the first time EPA proposes and just means the first notice proposing 100 X as opposed to X I have said respectfully disagreed there's the first time that EPA poses an emission standard is the first time EPA proposes any emission standard what what word does first body what word does first proposes and what word does and

[00:49:27] Speaker 03:
emission standard.

[00:49:29] Speaker 02:
So it seems like you need an end first to modify the same thing in order to make the argument you're making.

[00:49:36] Speaker 03:
No, the first proposal of an emission standard is the first time any emission standard is proposed.

[00:49:43] Speaker 02:
Maybe if it said commenced after the EPA, I'm going to scratch first, proposes regulations under this section establishing a first emission standard.

[00:49:58] Speaker 03:
Well, Your Honor, I don't think EPA, I don't think Congress would have had to write this differently to make it clear.

[00:50:03] Speaker 03:
It is clear by referring to the first time EPA proposes an emission standard.

[00:50:08] Speaker 02:
If we agree with you and we're going to write a sentence of the opinion, I'm going to leave a blank and ask for your help to fill in the blank.

[00:50:22] Speaker 02:
Putting aside that boilers don't last 100 years, a 100-year-old boiler is still new.

[00:50:29] Speaker 02:
just as a hundred-year-old blank is new.

[00:50:34] Speaker 03:
A hundred-year-old, I mean, we're talking about it being new only because it was built after the first proposal, right?

[00:50:44] Speaker 03:
So just as a hundred-year-old cement plant built after first proposal is new.

[00:50:52] Speaker 06:
So EPA proposed

[00:50:56] Speaker 06:
regulations for boilers back in 2003, right?

[00:51:04] Speaker 06:
Yes.

[00:51:05] Speaker 06:
Were those regulations, would they have been applicable to the boilers at issue here?

[00:51:13] Speaker 06:
Yes, they were.

[00:51:15] Speaker 06:
So any of those boilers are also new sources under your definition?

[00:51:25] Speaker 03:
Well, we don't take a position on that because it's not a statutory matter.

[00:51:29] Speaker 03:
It's a matter of construing the case law on the effect of vacature.

[00:51:34] Speaker 03:
This court vacated the 2007 standards and the court has held that the effective vacature is to restore the status quo before

[00:51:44] Speaker 03:
the vacated rule was promulgated.

[00:51:46] Speaker 05:
That sure doesn't undo the fact of proposal.

[00:51:50] Speaker 03:
Well, that issue hasn't been decided.

[00:51:54] Speaker 03:
If that's the conclusion the court reaches, then the first proposal wouldn't back in 2003.

[00:51:58] Speaker 05:
I mean, I think that's the clear implication of your position.

[00:52:04] Speaker 03:
Again, we're not taking a position on it because

[00:52:09] Speaker 03:
Our position is that EPA's definition should get held.

[00:52:13] Speaker 03:
We just disagree with EPA that the statute is ambiguous.

[00:52:15] Speaker 03:
And the last point I'd like to make on that is it is understandable that EPA would like to have the discretion to interpret this provision differently from one rulemaking to the next so that it can achieve the policy outcome that it wants to accomplish.

[00:52:30] Speaker 03:
But that doesn't make the statute ambiguous.

[00:52:34] Speaker 03:
There is no evidence apart from the fact that EPA would prefer to be able to interpret it a different way at different times.

[00:52:43] Speaker 03:
And there is no evidence in the text or the structure of the statute that actually shows this statute is ambiguous.

[00:52:51] Speaker ?:
Thank you.

[00:52:52] Speaker 06:
Thank you.

[00:52:58] Speaker 04:
Very briefly, Your Honours, it's worth thinking about

[00:53:02] Speaker 04:
the effect of what we've heard on the statutory scheme here.

[00:53:08] Speaker 04:
You know, as you recognize, new source defines by elimination what an existing source is.

[00:53:14] Speaker 04:
And there's this whole structure about existing sources and how you regulate them and how you revise those regulations.

[00:53:22] Speaker 04:
But that's a disappearing set under what we've heard from the government and the environmental groups.

[00:53:29] Speaker 04:
There won't be any existing sources down the road because everything will be a new source.

[00:53:37] Speaker 04:
And it's worth thinking too about the incentives here, which I think are inconsistent with the Clean Air Act goals.

[00:53:45] Speaker 04:
We didn't have to build a new state-of-the-art boiler number nine when we did.

[00:53:52] Speaker 04:
It replaced three boilers.

[00:53:54] Speaker 04:
that were older and dirtier that last 40 years.

[00:53:56] Speaker 04:
Typically, a boiler will last 40 years.

[00:53:59] Speaker 04:
And if we had thought that these 100 times more stringent rules were coming, it would have been totally uneconomic to build this boiler when we did.

[00:54:12] Speaker 04:
And in general, if the government's position were upheld here, why would anyone build a new boiler before they had to?

[00:54:20] Speaker 04:
you'll always be at risk of being labeled a new source subject to much more stringent standards and more expensive retrofits.

[00:54:34] Speaker 06:
But you're still subject to retrofits as an existing source if the best performing 12%

[00:54:43] Speaker 06:
Yes, absolutely.

[00:54:45] Speaker 04:
And in fact, what has happened here, Judge Walken, is that since we built the boiler, the existing source standards for these sorts of boilers have gotten more stringent.

[00:54:57] Speaker 04:
We haven't had to do a significant retrofit, but we have had to meet those new standards.

[00:55:01] Speaker 04:
And that's how the statute is supposed to work.

[00:55:03] Speaker 04:
You know, you anticipate that under the RTR process, there will be for existing oilers new standards each year, but they're based on the 12% and not on the best performing.

[00:55:15] Speaker 04:
And so they tend not to be so stringent.

[00:55:20] Speaker 04:
So we think the whole scheme of the statute, which has both of these new sources and existing sources, ties in with our interpretation and not with the government's.

[00:55:29] Speaker 04:
If there are no questions, Your Honor, I'll leave it there.

[00:55:33] Speaker 06:
All right.

[00:55:34] Speaker 04:
Thank you.

[00:55:36] Speaker 06:
So now we'll turn to the other case.

[00:55:41] Speaker 06:
Um, we'll hear from Mr Pew, um, your petition.

[00:56:01] Speaker 03:
Morning again.

[00:56:03] Speaker 03:
The Clean Air Act expressly requires EPA to base floors on the best performing sources, quote, for which the administrator has emissions information, the best performing 12% of the existing sources for which EPA has emissions information.

[00:56:21] Speaker 03:
And for smaller categories and subcategories with fewer than 30 sources, it's the best performing five for which the administrator has or could reasonably

[00:56:31] Speaker 03:
obtain emissions information.

[00:56:35] Speaker 03:
EPA does not dispute that its rule did not base floors on the best performing sources for which it has emissions information.

[00:56:44] Speaker 03:
EPA chose to exclude the last decade of emissions information that it has from its floor calculations and doesn't disagree that by doing so, it also excluded the best performing sources for which it has emissions information.

[00:56:59] Speaker 02:
Do you think that emissions information implies usable emissions information?

[00:57:07] Speaker 03:
Yes, certainly it provides usable information.

[00:57:10] Speaker 03:
But in this case, there's no dispute.

[00:57:12] Speaker 03:
EPA is not rejecting those data because they're not usable or there's anything wrong with them.

[00:57:15] Speaker 02:
I think they're saying it's unusable emissions information that with some work by EPA, like verification, could become usable emissions

[00:57:29] Speaker 03:
I don't think EPA is saying that there's any serious hurdle to using the admissions information it has.

[00:57:35] Speaker 03:
It's compliance information that was generated.

[00:57:37] Speaker 02:
I don't have the page or the brief in front of me, but I think their brief goes into some depth about what they would need to do to verify and that it actually is quite a

[00:57:52] Speaker 02:
Difficult process might be a stretch, but it's not an easy, quick process to just take the raw data that they have received electronically and turn that into a usable data set.

[00:58:08] Speaker 02:
This may be not a great analogy, but there's raw Intel that comes from Curveball in Iraq, and there's usable, verifiable Intel.

[00:58:19] Speaker 02:
And I think this implies

[00:58:23] Speaker 02:
usable missions information, and EPA says that takes some work.

[00:58:27] Speaker 03:
It might take some work, Your Honor, but it doesn't change the fact that this is information they have.

[00:58:30] Speaker 03:
It's information under their own compliance system.

[00:58:34] Speaker 03:
This is not some information coming out of left field that somebody just sent them that they have to convert.

[00:58:40] Speaker 03:
This is their own missions information that they have.

[00:58:43] Speaker 02:
It's unbearable.

[00:58:45] Speaker 03:
I don't know that it's unverified.

[00:58:46] Speaker 03:
They say it's unverified.

[00:58:48] Speaker 03:
Well, they may make the claim that there is some workload, but that doesn't change.

[00:58:52] Speaker 03:
This is the mission's information they have.

[00:58:54] Speaker 03:
Perhaps they have to process it, but EPA has had since 2016 to get this rulemaking done.

[00:58:59] Speaker 03:
This is a 2016 remand.

[00:59:01] Speaker 03:
The notion that EPA can't verify its own information is simply not a plausible reason to refuse to use it.

[00:59:08] Speaker 02:
Is that what your argument

[00:59:09] Speaker 02:
kind of hangs its hat on that there was this electronic reporting.

[00:59:13] Speaker 02:
And so EPA has this information.

[00:59:17] Speaker 02:
And so they needed to use it.

[00:59:19] Speaker 02:
Would you be making the same argument if there was no electronic reporting and EPA had to go out and collect a full data set more recent than 2013?

[00:59:30] Speaker 03:
No, we would say that then EPA doesn't have the information.

[00:59:33] Speaker 03:
This is information that it undisputedly has.

[00:59:36] Speaker 03:
EPA has never argued that it does not have this information.

[00:59:39] Speaker 06:
So I take your argument, but it seems like to the extent that EPA is for compliance purposes is continually getting new data.

[00:59:52] Speaker 06:
EPA could be in a position where, okay, it starts commences the rulemaking, preparing for the rulemaking process, let's say in 2019.

[01:00:04] Speaker 06:
they gather all the data that they have and that they can verify and they do all the calculations etc on that data you know then you know staff proposes a rule it's got to make its way up the chain internally before it gets to the federal register as a proposed rule and that might take a year or two

[01:00:29] Speaker 06:
And then the rule is proposed.

[01:00:32] Speaker 06:
And then your clients in their comments say, well, this rule is based on data that you elected as of 2019.

[01:00:42] Speaker 06:
There is more data that was collected in 2020.

[01:00:46] Speaker 06:
So we want you to use that data.

[01:00:49] Speaker 06:
I mean, under your construction of the statute,

[01:00:53] Speaker 06:
Would an EPA then have to respond to your comment by saying, OK, let's gather that data.

[01:01:00] Speaker 06:
And essentially, this is a never-ending dog chasing its tail situation.

[01:01:09] Speaker 03:
Your Honor, I don't think it's never-ending.

[01:01:12] Speaker 03:
I mean, there's an end when the final rule comes out.

[01:01:15] Speaker 03:
And really, this statute was promulgated with the understanding that EPA would go through the normal notice and comment rulemaking

[01:01:22] Speaker 03:
I don't think it would be unreasonable for EPA to cut the data off at the terms of proposal.

[01:01:26] Speaker 03:
But in fact, EPA often does consider data that is new between proposal and final.

[01:01:31] Speaker 03:
So I don't think there's anything wrong with that.

[01:01:32] Speaker 06:
Well, they do.

[01:01:34] Speaker 06:
I guess that's the point is that they do.

[01:01:37] Speaker 06:
And maybe to the extent that they can and they want to exercise their discretion to do so certainly wouldn't be arbitrary and capricious for them to continue gathering data.

[01:01:49] Speaker 06:
But why is it arbitrary and capricious for them to say, look, you know, this is where we're going to put the endpoint.

[01:01:58] Speaker 06:
And even if we have more data, we're just

[01:02:02] Speaker 06:
not going to use it because we think that the data we have is sufficient.

[01:02:07] Speaker 06:
And the new data isn't really going to move the needle that much.

[01:02:13] Speaker 06:
And so we need to stop somewhere.

[01:02:16] Speaker 06:
And we're supposed to defer to their technical expertise in matters like this, right?

[01:02:22] Speaker 03:
Well, not on matters that are determined by Congress in the statute.

[01:02:26] Speaker 03:
And the statute said that EPA has to base floors on the best performing data sources for which it has data.

[01:02:32] Speaker 03:
EPA doesn't get any discretion on that.

[01:02:34] Speaker 06:
I understand that interpreting a statute isn't within their technical expertise, but I guess, I mean, you seem to be conceding that at some point, even if EPA literally has, like in my hypo, if they gather data in 2019 and then they propose a rulemaking in 2020,

[01:02:59] Speaker 06:
And then during that comment, someone says, well, we want you to use the most current data that you have since 2019 and revise this rule.

[01:03:14] Speaker 06:
I thought you were agreeing that EPA could say no to that and still be in compliance with the statute.

[01:03:22] Speaker 03:
It's possible that the agencies could say no to information gathered after proposal, but I don't think that the statute requires that.

[01:03:30] Speaker 03:
I think the proper endpoint and one that is certainly clear and doesn't lead to sort of never-ending consequences would be the final rule.

[01:03:39] Speaker 02:
Why can they say no to data gathered after the proposal?

[01:03:43] Speaker 03:
I think that the concept of a rulemaking generally conceives of all of the data coming in at the time of proposal.

[01:03:52] Speaker 03:
That's the point of Section 307D.

[01:03:55] Speaker 06:
Well, what if it takes you a year from gathering to kind of have a proposal ready?

[01:04:02] Speaker 06:
So you stop gathering in 2019, you do calculations, the policy makers, officials have to sign off, OMB has to review it, all of these things have to happen.

[01:04:21] Speaker 06:
before it gets formally proposed.

[01:04:25] Speaker 06:
So there's a year between gathering and proposed.

[01:04:30] Speaker 06:
And somebody says, well, a lot of good data came in during that time period between 2019 and 2020 when you proposed this.

[01:04:41] Speaker 06:
We want you to use, doesn't the statute under your reading require EPA to

[01:04:47] Speaker 06:
to go back and use that data before they officially proposed regulation?

[01:04:53] Speaker 03:
This would be before proposal?

[01:04:55] Speaker 03:
Yes.

[01:04:56] Speaker 03:
I just don't think there's anything in the record to say that EPA can't use the data it has in its possession for proposal.

[01:05:02] Speaker 03:
And again, especially given the scope of time that EPA's rule makings happen over.

[01:05:07] Speaker 02:
There's just no that could be never ending because Judge Wilkins just explained it.

[01:05:11] Speaker 02:
It's not like EPA can just gather, decide, and then propose the next day.

[01:05:16] Speaker 02:
EPA gathers, decides, and then there is an interagency process.

[01:05:20] Speaker 02:
There's all kinds of other things.

[01:05:21] Speaker 02:
Maybe that takes a year.

[01:05:23] Speaker 02:
And then if they take your literalist interpretation of the statute for which the administrator has present tense admissions information, then the day before they're about to propose that rule,

[01:05:38] Speaker 02:
Now they have new emissions information.

[01:05:41] Speaker 02:
It seems like if you're right about being literally this, then they would have to press pause, start all over again, incorporate the new data, and then begin the maybe one-year interagency process again, which, of course, would be a never-ending cycle.

[01:05:57] Speaker 03:
I see your point, but I don't think that really gets to the situation here where EPA is excluding data.

[01:06:02] Speaker 02:
Your argument here is a statutory interpretation argument, so it has to be a statutory interpretation that is sound, not just here, but always.

[01:06:12] Speaker 03:
I think it is a sound statutory interpretation.

[01:06:17] Speaker 03:
It's consistent with the text.

[01:06:20] Speaker 02:
And the possibility that EPA... Do you concede that if we applied it in the situation Judge Wilkins described, it would be a never-ending cycle that ultimately results in no rule being broken?

[01:06:35] Speaker 03:
If EPA had to consider new data on the day before the rule was due,

[01:06:42] Speaker 03:
And considering that new data postpone the rule, I don't think that would happen.

[01:06:46] Speaker 03:
I mean, there are statutory deadlines that require the rule to come out at a certain date.

[01:06:50] Speaker 03:
So I don't think that... EPA blows by those deadlines all the time.

[01:06:54] Speaker 03:
That's a problem with EPA's conduct, not a problem with the deadlines.

[01:06:57] Speaker 02:
Your argument here would make that problem worse.

[01:07:00] Speaker 03:
I think, Your Honor, that EPA can cut off data based on a consideration of that it's just not feasible to use the data because of time considerations, but that's not what happened here.

[01:07:12] Speaker 02:
And that means that has, present tense has, does not literally mean has.

[01:07:17] Speaker 03:
It could mean that has means has in the present, not has in the future, or hasn't got it available yet.

[01:07:27] Speaker 03:
But I don't think it means that EPA can exclude data for the last decade, which is what it's claiming, and use that to make the standards less stringent, which is what it candidly admits it's doing in this rulemaking.

[01:07:40] Speaker 03:
This is about as clear an example of EPA elevating its policy desires over the plain text of the statute as there can be.

[01:07:52] Speaker 03:
EPA says that it excluded these data not because of time problems, not because of quality problems, but because it wanted the standards not to be more stringent.

[01:08:02] Speaker 03:
If EPA can do this, if EPA can cherry pick the data that way, simply choose to ignore emissions data and draw the top performing sources, not from the sources for which it has data, but from some other, essentially from any category or vintage of data it likes, 2010 data,

[01:08:21] Speaker 03:
20, you know, 2003 data, any data it likes, if the statute doesn't tell it to base floors on the best sources for which it has data, it could make standards either impossibly stringent or meaningless.

[01:08:34] Speaker 06:
That seems like an arbitrary and capricious challenge as opposed to statutory.

[01:08:41] Speaker 03:
Instruction well, Your Honor, I'm just pointing out that EPA statutory construction leads to that result, and that's a that's a tool of statutory construction.

[01:08:50] Speaker 05:
I suppose we agree with you that you measure this duty at the time that notice the NPRM goes out.

[01:09:07] Speaker 05:
But suppose also we think that has emissions information

[01:09:14] Speaker 05:
That phrase means something like, has the information in a usable form to avoid this endless loop problem.

[01:09:27] Speaker 05:
What can you tell us about whether the data in question was usable?

[01:09:37] Speaker 05:
I didn't find anything in either your brief or their brief on this question because

[01:09:44] Speaker 05:
I think they're resting not on the theory that the data was too inchoate.

[01:09:51] Speaker 05:
They're resting on the Weld County theory that it's a remand without vacatur, so they want consistency over timeliness.

[01:10:02] Speaker 03:
Thanks, John.

[01:10:03] Speaker 03:
I'd like to get, I guess, both pieces of that argument.

[01:10:05] Speaker 03:
I mean, the best evidence that EPA can, in fact, use the data it has is that it did use it in the Beyond the Floor Standards.

[01:10:12] Speaker 05:
I'm sorry.

[01:10:13] Speaker 03:
In the Beyond the Floor Analysis.

[01:10:15] Speaker 03:
In a number of these, for a number of these standards, EPA's floor analysis made the standards less stringent than they were in 2013.

[01:10:25] Speaker 03:
And EPA then conducted Beyond the Floor Analysis to determine if it's

[01:10:30] Speaker 03:
you know, if the standards could be made more stringent and it used those very data for that purpose.

[01:10:35] Speaker 03:
So certainly in the 2020 rule, in the 2020 rule, these right, there's no question that these data were usable.

[01:10:42] Speaker 06:
The EPA does not have to promulgate beyond the floor standards, right?

[01:10:47] Speaker 06:
Right.

[01:10:48] Speaker 06:
The statute, Congress gives them the discretion to determine whether to promulgate beyond the floor standards.

[01:10:55] Speaker 03:
Well, the discretion doesn't go quite that far.

[01:10:57] Speaker 03:
It tells EPA to promulgate beyond the floor standards if they're achievable.

[01:11:01] Speaker 03:
But certainly, they have a lot more discretion over beyond the floor standards than they do floor standards.

[01:11:08] Speaker 02:
I have a couple more.

[01:11:10] Speaker 02:
One is, if we rule in your favor and remand on this issue, what data set should EPA use to craft the next rule?

[01:11:20] Speaker 03:
It should use the data set.

[01:11:21] Speaker 03:
It sort of depends on when EPA gets around to this rulemaking, Your Honor.

[01:11:28] Speaker 03:
We hope that EPA will respond promptly.

[01:11:31] Speaker 03:
to the court's remand, but there are remands pending from 2004 right now.

[01:11:36] Speaker 03:
And so I won't say that EPA should use these data, because I don't know when EPA is going to get around to the remand.

[01:11:43] Speaker 03:
But if EPA promptly promulgates the remand, which I think was the intent, then I think that this data set would be fine.

[01:11:51] Speaker 02:
I mean, this data set ends in 2020, right?

[01:11:54] Speaker 03:
why why under your okay assuming assuming that EPA promulgated in 2024 EPA should should use the additional data that it has when it when it comes out of proposal your honor there was one more question you piece of that question though I don't think I got to it wasn't just about the usability of the data yeah it's just their rationale seems unless I missed something their rationale and

[01:12:21] Speaker 05:
at the time was we're going to use old data.

[01:12:27] Speaker 05:
The same reason we used old data in Weld County.

[01:12:30] Speaker 05:
Limited partial remand.

[01:12:33] Speaker 05:
Most of the standards are going to be under 2013.

[01:12:38] Speaker 05:
There's an interest in consistency and there's an interest in moving extra quickly because our remand order was rattling the saber of mandamus already.

[01:12:49] Speaker 05:
That's their rationale.

[01:12:51] Speaker 05:
Right.

[01:12:52] Speaker 05:
So the first one is like to me, I'll just put my cards on the table.

[01:12:56] Speaker 05:
If we're just doing arbitrary and capricious review, that's good enough under Weld County.

[01:13:04] Speaker 05:
Right.

[01:13:04] Speaker 05:
And you have a statutory argument which might or might not overcome that.

[01:13:08] Speaker 03:
I would say that right, I would say that the difference between this case involved County is that that was dealing with statute doesn't have a for provision saying EPA has to base the force on on the emissions on the on the best sources for which it has data.

[01:13:20] Speaker 03:
And as to the limited nature of the remand.

[01:13:25] Speaker 03:
The court.

[01:13:27] Speaker 03:
didn't remand all the standards, that's true, but it found them flatly unlawful.

[01:13:31] Speaker 03:
It initially vacated the standards and it didn't expect EPA to do anything different on this remand than it would have done if it had vacated those standards.

[01:13:40] Speaker 03:
In fact, EPA stated in its rehearing petition that it was going to promulgate revised standards.

[01:13:46] Speaker 03:
As this court held in the Medical Waste Institute case back in 2010 on the remand of EPA's medical waste incinerator standards,

[01:13:56] Speaker 03:
Not all remands require EPA to promulgate revised standards, but where they do, they essentially have the same effect as a vacatur.

[01:14:03] Speaker 03:
They require EPA to start the process and regulate it, as though it's on a blank slate.

[01:14:09] Speaker 06:
So to the extent that, I mean, the rule of prejudicial error always applies even in these contexts.

[01:14:20] Speaker 06:
I mean, to the extent that EPA

[01:14:24] Speaker 06:
considered the newer data and promulgated beyond the floor standards?

[01:14:34] Speaker 06:
Where's the prejudice?

[01:14:36] Speaker 03:
You mean where are we harmed?

[01:14:38] Speaker 06:
Yeah.

[01:14:38] Speaker 03:
Well, there's two ways.

[01:14:41] Speaker 03:
Some of the standards EPA didn't do beyond the floor standards.

[01:14:45] Speaker 03:
And even where EPA did do beyond the floor standards, that doesn't mean that the standards are as stringent as properly calculated floor standards would be.

[01:14:54] Speaker 03:
It just meant that EPA chose to bring the standards back up to the level they were in 2013.

[01:15:01] Speaker 03:
Do we know that?

[01:15:03] Speaker 03:
Yes, that's exactly what EPA was doing.

[01:15:05] Speaker 03:
When it promulgated beyond the floor standards, it said, the question it asked was, well, do we know that our 2013 standards were achievable?

[01:15:13] Speaker 03:
We're going to look at the emissions data and show that they're achievable.

[01:15:15] Speaker 03:
And it did.

[01:15:16] Speaker 03:
And that was its rationale for leveling up the standards to the 2013 level.

[01:15:24] Speaker 06:
But we'll make sure we're understanding each other.

[01:15:30] Speaker 06:
You're saying that beyond the floor standards are less stringent than the MACD floor standards would have been if they had used the newer data.

[01:15:46] Speaker 03:
Well, we don't know exactly what the floors would be if EPA had calculated floors using the data it has.

[01:15:52] Speaker 06:
That's my point.

[01:15:54] Speaker 03:
We don't know whether they're prejudiced, so to speak.

[01:15:58] Speaker 03:
But what we do know is that EPA excluded best performing sources from its floor calculations and that it did so precisely to make sure that its standards were not more stringent.

[01:16:09] Speaker 03:
That's what EPA said in the record at page seven of the Joint Appendix.

[01:16:13] Speaker 03:
We don't want these standards to be more stringent and that's why we're excluding these data and these sources.

[01:16:19] Speaker 03:
So I don't think there's any question that it's led to the standards being less stringent.

[01:16:24] Speaker 03:
That's that's a point.

[01:16:27] Speaker 02:
It is.

[01:16:29] Speaker 02:
But EPA brief says.

[01:16:32] Speaker 02:
EPA has broad discretion in assessing the nature and timing of the data to be considered in establishing a mission standard.

[01:16:39] Speaker 02:
You agree with that?

[01:16:42] Speaker 03:
Not under this provision.

[01:16:45] Speaker 02:
So maybe as a general matter, they do.

[01:16:47] Speaker 02:
But the statutory text here takes that discretion away.

[01:16:51] Speaker 03:
Right.

[01:16:51] Speaker 03:
I can imagine another part of the statute where EPA might have more discretion.

[01:16:55] Speaker 02:
Just similar to what you and Judge Katz just wrote.

[01:16:57] Speaker 03:
Yes.

[01:16:57] Speaker 02:
OK.

[01:16:58] Speaker 02:
And then I think this is my last question.

[01:17:00] Speaker 02:
As you may know, in the Ohio v. EPA case at the Supreme Court, right now, one of the key arguments against EPA

[01:17:08] Speaker 02:
is that when you have a system of interrelated rules, they can't function properly when something happens to make the application of those rules not uniform.

[01:17:21] Speaker 02:
I wonder, do you think that sheds any light on this problem?

[01:17:25] Speaker 02:
I mean, this would cut against you.

[01:17:26] Speaker 02:
So maybe my question is why does this not shed light on our problem?

[01:17:32] Speaker 02:
If EPA loses that case and the Supreme Court says, you know, there's just something kind of not right about subjecting 83% to a strict data set.

[01:17:45] Speaker 02:
I'm going to now wedge into our case, but segue in our case.

[01:17:47] Speaker 02:
Subjecting 83% to a generous data set and 17% to a lenient data set for the very kind of arbitrary reason that, you know,

[01:17:59] Speaker 02:
In our case, some of them came later than others.

[01:18:05] Speaker 03:
Well, Your Honor, I have to say, and I'm not familiar with the details of the Ohio case, but I would say that it's not construing this particular statute.

[01:18:14] Speaker 03:
And the policy argument you're talking about is one EPA articulated in the record.

[01:18:18] Speaker 03:
It said that that's one reason it didn't want the standards to be more stringent.

[01:18:23] Speaker 03:
But it's just a policy argument.

[01:18:24] Speaker 03:
It doesn't override the statutory requirement to base floors.

[01:18:27] Speaker 02:
And it's only a loose.

[01:18:28] Speaker 02:
analogy, but the 10 second version of what's going on there is they did nationwide standards for different states and some of those courts have vacated the state, the rules for calls for some of those states.

[01:18:39] Speaker 02:
So some of the states are subject to the more rigorous.

[01:18:42] Speaker 02:
Some of the states have gotten relief at least temporary and the ones that are left say, hey, it's just, it's not right that it was supposed to be uniform.

[01:18:50] Speaker 02:
Now it's not uniform.

[01:18:51] Speaker 02:
Why should we be left with the extra strict stuff?

[01:18:54] Speaker 03:
The other point I would say, I don't think as a statutory matter it matters, but EPA agrees that if this is really a concern, if consistency across the board for every source in the category is truly an important concern for the agency, it can level up and make them all similarly stringent based on the same data.

[01:19:20] Speaker 03:
Thank you.

[01:19:29] Speaker 01:
Once again, we're here on a limited remand where EPA was directed to revise limited number of standards without examining all the new data.

[01:19:42] Speaker 01:
There was nothing in the court's opinion that even implied that EPA should go back and use all new data.

[01:19:49] Speaker 01:
As Judge Casas, you've pointed out, the Weld County case really applies on all fours.

[01:19:55] Speaker 05:
it was under a different statute but maybe yes maybe no right we have some statutory text here that wasn't present there that's best performing for which EPA has commissions information I mean suppose I asked you

[01:20:14] Speaker 05:
You're a football junkie and you follow all the statistics, right?

[01:20:20] Speaker 05:
And I ask you, what is the passer rating for the best performing quarterback in the NFL?

[01:20:29] Speaker 05:
And you answer by giving me Tom Brady's rating from eight years ago.

[01:20:35] Speaker 05:
Would that be a fair answer to the question I put to you?

[01:20:39] Speaker 01:
Not to not to that question.

[01:20:42] Speaker 01:
It probably would not be fair, but that's not the question that the US sugar.

[01:20:47] Speaker 01:
decision posed to EPA.

[01:20:50] Speaker 01:
It said, go back and figure out the correct sources that are in each category.

[01:20:55] Speaker 01:
And just as to the ones that you find, make any necessary corrections on that.

[01:21:00] Speaker 01:
It was not saying, look to the future and give me a whole new set of emissions.

[01:21:06] Speaker 01:
It said, you made some errors, correct the errors.

[01:21:09] Speaker 01:
And when you go back and correct the errors, you do that.

[01:21:12] Speaker 05:
I mean, do a new rulemaking, right?

[01:21:15] Speaker 05:
We didn't vacate the old standard.

[01:21:18] Speaker 05:
It continued to have the force and effect of law.

[01:21:22] Speaker 05:
And you have to do a new rulemaking.

[01:21:25] Speaker 05:
And look, there's a statutory standard for that.

[01:21:28] Speaker 05:
And it says, look at the best performing standards for which you have data.

[01:21:34] Speaker 01:
And it leaves to EPA the discretion

[01:21:38] Speaker 01:
to determine what data to look at.

[01:21:41] Speaker 01:
That's been stated by this court over and over again.

[01:21:44] Speaker 01:
That is in the two provisions that petitioners rely on, their statutory argument, an admissions limit that is deemed achievable for new sources, that's achieved in practice by the best controlled similar source as determined by the administrator.

[01:22:03] Speaker 01:
This is not merely reading numbers

[01:22:06] Speaker 01:
on a graph or a chart.

[01:22:08] Speaker 01:
EPA goes through a comprehensive process to do that.

[01:22:14] Speaker 01:
The provision uses the word deemed, not just what is laid out on a page in a report, and it's deemed in the judgment of the administrator.

[01:22:25] Speaker 01:
Court in U.S.

[01:22:25] Speaker 01:
Sugar said the Clean Air Act directs EPA to establish emission caps that result in the maximum degree

[01:22:32] Speaker 01:
reduction in emissions that the EPA determines is achievable.

[01:22:36] Speaker 01:
And the statute says nothing about when EPA is supposed to look at that.

[01:22:42] Speaker 01:
What temporal application they're supposed to look at in the data.

[01:22:46] Speaker 06:
But what about the fact that under, you know, this definition for new and existing sources and sub paragraph B, it talks about

[01:22:59] Speaker 06:
the best performing five sources for which the administrator has or could reasonably obtain admissions information.

[01:23:11] Speaker 06:
So there, doesn't the Congress require the administrator to seek to obtain information if it's reasonable

[01:23:27] Speaker 06:
to obtain it.

[01:23:32] Speaker 06:
So it's going beyond like what the administrator has in their possession, but they have to seek to obtain it.

[01:23:41] Speaker 06:
And how does that make sense if as does it mean that what you already kind of have in your possession

[01:23:53] Speaker 01:
So the process, the compliance reports are basically simple reports of emissions levels reached by the reporting entities.

[01:24:06] Speaker 01:
The process for establishing emission standards that everybody is subject to is a whole different process.

[01:24:13] Speaker 01:
It requires a collection of data from all of the sources.

[01:24:16] Speaker 01:
It requires that that data is carefully scrutinized, often tested, and EPA goes back to the source.

[01:24:25] Speaker 01:
It's based on an average of the emission standards that's reached.

[01:24:29] Speaker 01:
After that, the upper protection limit is applied to determine variability.

[01:24:36] Speaker 01:
It's based on a whole number of different factors that takes typically years to assess.

[01:24:44] Speaker 01:
Those are the efforts that EPA makes to collect the data to create standards.

[01:24:51] Speaker 01:
The simple reports of how a particular entity is doing should not form the basis for a set of standards.

[01:25:04] Speaker 01:
And it doesn't in practice.

[01:25:06] Speaker 01:
As far as the language in the statute about it,

[01:25:10] Speaker 01:
for which the administrator has emissions information, which petitioners hang their hats on.

[01:25:17] Speaker 01:
As this court said in Mississippi Commission on Environmental Quality, interpreting similar language, quote, the act calls for EPA to make designations on the basis of available information.

[01:25:29] Speaker 01:
That's similar to here.

[01:25:30] Speaker 01:
We have repeatedly found similar language to be ambiguous when assessing whether to defer to an agency's construction.

[01:25:37] Speaker 01:
EPA therefore may interpret the statutory language as it sees fit, so long as its interpretation is reasonable.

[01:25:45] Speaker 01:
We think that the interpretation here as to what information is possessed by the administrator is quite reasonable.

[01:25:52] Speaker 06:
So we need to, I take your point, but we need to interpret the statute so that

[01:26:01] Speaker 06:
You know, this subsection 3A makes sense and also so that the subsection 3B would also make sense.

[01:26:11] Speaker 06:
What does, what does, has or could reasonably obtain emissions information in 3B?

[01:26:18] Speaker 06:
What does that mean?

[01:26:20] Speaker 01:
We think that the reasonably obtained means conducting a whole, you know, review process of all of the, every one of the boilers subject to regulation of going through all of the stack tests that are required, applying the small data requirements that if you don't have enough stack tests, that certain formulas have to be.

[01:26:46] Speaker 01:
that EPA has to review and consider normal patterns versus log normal patterns and the distribution of the data and the timing of the data.

[01:26:59] Speaker 01:
Do you believe that's the difference here and that's the reasonable steps EPA makes, which are not reflected in simple compliance reports?

[01:27:10] Speaker 06:
So your position is that Congress gives EPA

[01:27:15] Speaker 06:
the choice to go with A or B, here 3A or 3B, and EPA chose 3A, and so they have some discretion there since it doesn't include the language or reasonably obtain emissions information to do what it did here.

[01:27:36] Speaker 01:
Yes, and as the court has said many times, EPA does have a lot of discretion in the data collection, the data consideration, the data analysis.

[01:27:46] Speaker 01:
portion, creating these standards.

[01:27:49] Speaker 05:
Your colleague said that the disputed data here were actually usable because EPA did in fact use them for other purposes.

[01:28:04] Speaker 01:
want to respond to that.

[01:28:05] Speaker 01:
Yeah, that's a different process.

[01:28:07] Speaker 01:
That's the beyond the floor process.

[01:28:09] Speaker 01:
And EPA did not create new standards based on beyond the floor process.

[01:28:15] Speaker 01:
All it did was look at the compliance reports, see that people were complying with the original 2013 standards, and said, well, part of the beyond the floor analysis looks at the costs.

[01:28:29] Speaker 01:
It has to look at the costs unlike the Mac floor.

[01:28:33] Speaker 01:
And it used that information to determine that these entities would not incur costs to comply with a stricter standard or beyond the floor standard, because they had already been doing it.

[01:28:45] Speaker 01:
And they had already had put in the equipment to do that.

[01:28:49] Speaker 01:
But it was limited.

[01:28:51] Speaker 05:
That suggests that this data is not, the problem here is not that that data is just a jumble.

[01:29:02] Speaker 05:
and you haven't had time to convert the numbers that are coming in through the compliance monitors or whatever into something that you can use to set standards, go with two things going forward.

[01:29:19] Speaker 01:
Well, again, through these technology reviews that are to occur every eight years, EPA does an analysis of whether the technology has advanced to a level that really would require a whole new establishment of a set of new emissions.

[01:29:35] Speaker 01:
And when it does that, it starts the extensive review process, which again, collects the data from every single source, scrutinizes that data.

[01:29:46] Speaker 05:
applies the the that review process different than for beyond the floor purposes yes okay so your your primary rationale here was that you in a in what you characterize as a limited remand without vacatur you don't have to the statute does not require you

[01:30:15] Speaker 05:
to reopen the rulemaking record.

[01:30:18] Speaker 05:
That's correct.

[01:30:19] Speaker 05:
Consider new data.

[01:30:20] Speaker 05:
OK, I get that.

[01:30:22] Speaker 05:
But are you pressing an alternative theory that the disputed data here, you didn't have it because it was just too much of a jumble.

[01:30:39] Speaker 05:
You hadn't had time to digest it.

[01:30:43] Speaker 01:
We didn't have it in a form that could support a whole new process of resetting.

[01:30:50] Speaker 05:
Okay, and where do I get that?

[01:30:52] Speaker 05:
Because I didn't see that in your explanation.

[01:31:00] Speaker 05:
It's five through seven of the rulemaking.

[01:31:05] Speaker 05:
It's all about the Art Weld County point of you just want a consistent data set.

[01:31:13] Speaker 01:
across all standards.

[01:31:16] Speaker 01:
That's true.

[01:31:17] Speaker 01:
That was, you know, some of some of the bases here.

[01:31:21] Speaker 01:
Um, but there were some explanations as I think Judge Walker referred to earlier about the process that you have to go through

[01:31:30] Speaker 01:
to create a whole new set of standards.

[01:31:33] Speaker 02:
But to clarify, I was talking about stuff you explained in the brief.

[01:31:37] Speaker 02:
OK.

[01:31:38] Speaker 02:
I don't know if Judge Katz is asking this or not, but I'll ask it.

[01:31:41] Speaker 02:
Where can we find that in the record?

[01:31:45] Speaker 01:
I don't have the references for you on that.

[01:31:48] Speaker 01:
I can't get those for you.

[01:31:49] Speaker 05:
I'll ask a slight variation, which is have the alternative that I've articulated there be a chennery problem with.

[01:31:57] Speaker 05:
considering that as a basis for affirming.

[01:32:01] Speaker 05:
What would there be?

[01:32:02] Speaker 05:
Could we affirm on the basis that the data, the late breaking data is just too messy to use?

[01:32:10] Speaker 05:
Is that doesn't seem to be the rationale that you've rested on in the administrative order?

[01:32:16] Speaker 01:
Probably you could.

[01:32:18] Speaker 01:
I'm not sure that messy was the right.

[01:32:21] Speaker 01:
It would be the correct word.

[01:32:22] Speaker 01:
Probably incomplete.

[01:32:24] Speaker ?:
Okay.

[01:32:26] Speaker 06:
I'm sorry, I didn't understand your answer to Judge Katz's question.

[01:32:30] Speaker 06:
You're saying that would be a Chenery problem?

[01:32:33] Speaker 01:
That it could be firm on that basis.

[01:32:41] Speaker 02:
We could deny the petition on the basis of this argument you're making that the data wasn't usable, even though

[01:32:51] Speaker 02:
Chenery says we can't consider an agency reason that wasn't part of the reason when they made the decision.

[01:33:01] Speaker 01:
We believe that, you know, it's basically in EPA's explanation, so it might not be explicit.

[01:33:08] Speaker 02:
And then there's the follow-up.

[01:33:10] Speaker 02:
And this is, I think, a friendly question.

[01:33:12] Speaker 02:
Where in EPA's explanation can I go to see that you preserved this argument?

[01:33:22] Speaker 01:
Again, I have to go back to the rulemaking and get you the exact pages for doing that.

[01:33:28] Speaker 01:
I'm assuming I can find it, but you're implying that I can't.

[01:33:35] Speaker 05:
I have it at five to seven.

[01:33:38] Speaker 05:
If there are other things of the JA, if there are other things we should look at, I'd be curious to know what they are.

[01:33:50] Speaker 02:
The petitioners say in their briefs, EPA does not dispute that it excluded best performing boilers for which it has emissions information from its floor calculation.

[01:34:06] Speaker 02:
Do you agree with that statement?

[01:34:10] Speaker 01:
No, we do not agree with that statement.

[01:34:11] Speaker 02:
Why is it inaccurate?

[01:34:13] Speaker 01:
Because again, you cannot just go on compliance

[01:34:17] Speaker 01:
reports, EPA would have to go back and go through its whole analysis to establish that.

[01:34:23] Speaker 01:
Okay.

[01:34:25] Speaker 02:
Um, well, hopefully that we'll see if that's, if we'll see if that is what EPA said, um, when it made its decision.

[01:34:34] Speaker 02:
Um, can I ask the presiding judge for permission to ask one question about the remedy in the earlier issue?

[01:34:40] Speaker 02:
Sure.

[01:34:42] Speaker 02:
Um, I talked with the petitioners on the earlier issue, the industrial petitioners.

[01:34:47] Speaker 02:
about whether if we agree with them on issue number one, the new versus existing rule, you know what I'm talking about?

[01:34:55] Speaker 02:
Yes.

[01:34:57] Speaker 02:
Should it be a universal vacator?

[01:34:58] Speaker 02:
Or should it be that would apply to any boilers built, begun to be built before 2020?

[01:35:07] Speaker 02:
Or should it be a more narrow remedy that only provides relief

[01:35:15] Speaker 02:
to boiler number nine and the nine other boilers.

[01:35:19] Speaker 01:
It should be limited to those boilers, those identified boilers.

[01:35:23] Speaker 01:
And did you argue that in your red brief?

[01:35:26] Speaker 01:
I don't believe we did, but that was the remedy that petitioners were seeking.

[01:35:30] Speaker 01:
They were not seeking, as far as I know, a global remedy here.

[01:35:35] Speaker 01:
In fact, I think they talked about the fact that this was limited to the usual practice, I think, for decades has been

[01:35:43] Speaker 02:
And as we remain without back at her, that aside, when we vacate, it's not a party specific back at her.

[01:35:50] Speaker 02:
It's a universal back.

[01:35:51] Speaker 02:
I think that's been our practice for decades.

[01:35:53] Speaker 01:
You want us to part from that?

[01:35:57] Speaker 01:
Yes, we think it's limited to the claims made in this case, which they limited to standards for certain pollutants, limited pollutants here in for a limited class of the 34 different subclasses that

[01:36:14] Speaker 06:
Can you just explain to me as a lay person trying to understand this, how is data good enough to be used for rulemaking standard for beyond the floor, but it's not good enough for the floor standard?

[01:36:42] Speaker 01:
So EPA can look at different factors when it goes beyond the floor.

[01:36:49] Speaker 01:
And it simply, really, with the focus on costs, use the limited data that it had to determine that this would not result in incurring costs at all, perhaps, but any kind of reasonable costs, monumental costs,

[01:37:10] Speaker 01:
in just requiring these entities to comply with the standards that were in place before the change was made.

[01:37:17] Speaker 06:
But the beyond the floor standards are universal, right?

[01:37:20] Speaker 06:
They're to all boilers that fit within that classification, right?

[01:37:25] Speaker 01:
That's correct.

[01:37:27] Speaker 06:
Just like floor standards apply to all boilers that fit within the classification.

[01:37:33] Speaker 06:
So I guess I'm just not understanding why new data is good enough

[01:37:40] Speaker 06:
to create a kind of across the board standard that goes beyond the floor.

[01:37:48] Speaker 06:
So it would seem like you need even better data to do that because you're exercising your agent, your client, the agency is exercising its discretion to kind of set a more stringent criteria.

[01:38:04] Speaker 06:
So it would seem like you need the best data to justify doing that.

[01:38:09] Speaker 06:
But you're saying somehow the data was good enough to do that, but it wasn't good enough to set a floor.

[01:38:15] Speaker 06:
That just, logically, that doesn't track.

[01:38:18] Speaker 01:
Well, it goes beyond the floor of the 2020 standards.

[01:38:24] Speaker 01:
But it doesn't go beyond the floor of the original 2013 standards, which the most entities were complying with.

[01:38:33] Speaker 01:
So that's the difference here.

[01:38:37] Speaker 01:
Some of the standards change.

[01:38:39] Speaker 01:
2020.

[01:38:40] Speaker 01:
But EPA made a determination that we can use the beyond the floor standard to make sure that at least people continue to comply with the 2013 standards.

[01:39:00] Speaker 01:
It did not use data collected through subsequent years to

[01:39:09] Speaker 01:
alter those standards and say, you know, we're raising the standards on that basis when it ended beyond the floor.

[01:39:15] Speaker 01:
It used it to ensure that whether the standard has changed, if the standard, for instance, has lowered, you could still be required to comply with the 2013 standard.

[01:39:25] Speaker 01:
Okay.

[01:39:26] Speaker 06:
I'm not completely sure that I understand, but I'll go back and review that

[01:39:39] Speaker 06:
Any other questions?

[01:39:41] Speaker 06:
Thank you.

[01:39:46] Speaker 06:
I think you were out of time, but we'll give you two minutes.

[01:39:48] Speaker 03:
Thank you.

[01:39:49] Speaker 03:
Very quickly, I'd like to come back to what EPA actually did say in the record.

[01:39:54] Speaker 03:
EPA has never disputed that it has emissions data and that it excluded best sources for which it has emissions data.

[01:40:00] Speaker 03:
It didn't dispute it in the record when we made this point in comments.

[01:40:04] Speaker 03:
It didn't dispute the point in its brief.

[01:40:06] Speaker 03:
and we made this point throughout our opening brief.

[01:40:11] Speaker 03:
What EPA's rationale was is that page six of the Joint Appendix, page 70 of its brief, EPA's rationale is a statutory interpretation

[01:40:19] Speaker 03:
that the statute does not mean what it says, that the only function of the requirement to base floors on the best sources for which it has emissions information is to relieve EPA from having to collect data for all the sources in a category and set standards based on all the sources in a category.

[01:40:39] Speaker 03:
The problem with that interpretation is that it's simply not what the statute says.

[01:40:43] Speaker 03:
The statute expressly directs EPA to base floors on the best sources for which it has emissions information.

[01:40:49] Speaker 03:
Thank you.

[01:40:54] Speaker 06:
Thank you.

[01:40:55] Speaker 06:
We'll take the matter under his vice.