Earlier this week, the 10th Circuit Court of Appeals vacated EPA's disapproval of Montana's regional haze plan for the PacifiCorp's Wyodak power plant. The basis for the disapproval was an issue near and dear to my heart. In rejecting Montana's SIP, EPA repeatedly pointed to Montana's failure to comply with EPA's guidelines for determining Best Available Retrofit Technology, even though the guidelines were not enforceable regulations.
The role of the BART guidelines is a curious one. Congress required in the Clean Air Act that EPA develop guidelines for determining BART. Moreover, the CAA provides that, with respect to powerplants with a total capacity great than 750 megawatts, the BART guidelines are binding. However, Congress did not make the BART guidelines mandatory for facilities below the 750 MW threshold.
To me, that Congress made the BART guidelines binding for large facilities, but not for small facilities, makes it obvious that EPA cannot enforce the guidelines against small facilities. It's actually a weaker situation for the enforcement of guidance than if Congress had said nothing at all and EPA had just developed the BART guidelines on its own.
However, EPA did not see it that way, and the 10th Circuit opinion is replete with citations to EPA's rule that reflect a conclusion by EPA that the failure to "comply" with the BART guidelines was a fatal flaw in Montana's regional haze SIP. For example:
In the final rule, the EPA noted that it had "proposed to disapprove the State's [Wyodak] determination because the State neglected to reasonably assess the costs of compliance and visibility improvement in accordance with the BART Guidelines."
It is important to note that the decision was not some radical repudiation of EPA authority. The opinion is in fact quite measured both in its tone and its conclusion:
Certainly, the guidelines are helpful while not binding, and ordinarily no problem presents itself when the EPA references them in reviewing Wyoming's SIP. The problem arises, however, when the EPA's rejection of the state's BART determination—supposedly for unreasonable cost and visibility analyses—is grounded in a strict application of the nonbinding guidelines. The EPA's final rule confirms that the agency treated the guidelines as binding for Wyodak and disregarded the state's broad discretion under the Clean Air Act.
Moreover, the Court did not rule that EPA had to accept the Wyoming SIP. It merely remanded with an order the EPA reconsider the Wyoming SIP, "giving proper deference to the state and without treating the guidelines as binding."
Sounds reasonable to me.
The case is clearly further grist for my anti-guidance mill. The evidence is inescapable that, when agencies promulgate guidance – even when with the best intentions – it is inevitable that they will ultimately come to treat the guidance as though it were a binding regulation. And that's not how the administrative process is supposed to work.
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