ELR Citation: ELR 20762
No(s). s. 81-2276, -2279 (D.C. Cir. Jul 26, 1985)

The court holds that the Environmental Protection Agency (EPA) Administrator acted arbitrarily and capriciously and abused her discretion in granting a waiver to American Methyl Corporation under §211(f)(4) of the Clean Air Act for a methanol fuel additive. In a footnote the court rules that, although waivers are automatic under the section if EPA does not act on applications within 180 days, the applicant still must bear the burden of demonstrating that the additive will not cause or contribute to the failure of a motor vehicle emission control device to meet emission control standards over the useful life of the vehicle. The court then rules that §211(f)(4) does not bar waivers for additives that will result in some increase in emissions short of an amount causing or contributing to a violation. Whether to issue a waiver is committed to the discretion of the Administrator; the language of the statute, as illuminated by the legislative history, bars waivers only where the additive will lead to violations.

The court also notes that §211(f)(4) requires a demonstration that the additive will not cause or contribute to violations over the full (5-year or 50,000-mile) useful life of vehicles, but rules that costly 50,000-mile durability tests are not required in all cases to make this demonstration EPA must, however, have a clear basis for concluding that durability tests are not required. The court holds that EPA arbitrarily relied solely on tests evaluating the instantaneous effect of petitioner's additive in lieu of the durability test. EPA's rationale for not conducting durability tests was based on earlier decisions on three additives in which the agency concluded that such tests were unnecessary. Only one of the three additives involved in those tests included methanol, the main ingredient in petitioner's additive, and in much lower concentrations. In all three cases, EPA relied on evaluation of data on the compatibility of the chemicals in the additives with the materials in emission control devices and on information about the chemical composition of the specific additive; in this case EPA had no such data. The reduced standard of proof is particularly inappropriate since EPA had a report indicating that methanol additives can cause emission increases that worsen over time; and EPA had in two earlier instances denied waiver applications for methanol additives.

The court holds that EPA violated §211(f)(4) when it initially approved the waiver. EPA concedes that it appears on the record that the fuel-additive mixes tested did not include the maximum methanol concentration and the methanol-to-four-carbon-alcohol ratio for which the waiver was sought. The court accepts EPA's concession, noting that although EPA may not revoke a waiver based on new evidence, it may declare void a waiver that was improperly granted. The court next rules EPA's approval of the waiver even though petitioner's additive failed one of the instantaneous emission violation tests was arbitrary. The additive failed one of EPA's tests for nitrogen oxide emissions, and EPA gave no reasoned explanation for ignoring that failure in issuing the waiver.

Finally, the court upholds the Administrator's conclusions concerning evaporative emissions, despite the support for the conclusions in the record and contrary evidence outside the record, and expresses doubts about the adequacy of EPA's consideration of the additive's effects on materials compatibility and driveability.

Counsel for Petitioners
Gary B. Toth, William H. Crabtree, Mark Slywynsky
Office of General Counsel
General Motors Corporation
General Motors Bldg, 3044 W. Grand Blvd, Detroit MI 48202
(313) 556-5000

Robert G. Seasonwein
Vice President & General Counsel
Motor Vehicle Manufacturers Association
300 New Center Bldg, Detroit MI 48202
(313) 872-4311

Counsel for Respondents
David E. Dearing, Samuel I. Gutter, Robert A. Weissman, Gerald K. Gleason
Land and Natural Resources Division
Department of Justice, Washington DC 20530
(202) 633-2741

Counsel for Intervenor
James W. Moorman
Cadwalader, Wickersham & Taft
1333 New Hampshire Ave. NW, Washington DC 20036
(202) 293-6300

Before: TAMM, WALD, and MIKVA, Circuit Judges.