ELR Citation: ELR 20259
No(s). 89-1070 (1st Cir. Oct 31, 1989)

The court holds that the Environmental Protection Agency (EPA) properly required a cement company to obtain approvals for prevention of significant deterioration (PSD) under the Clean Air Act before constructing a replacement kiln in an area with particularly clean air. The replacement kiln would pollute far less than the old kilns at the same production level, but at capacity, the new kiln would produce more pollutants. The court initially holds that EPA's determination is final agency action ripe for judicial review, and then waives any exhaustion requirements to prevent substantial hardship. The record supports EPA's method of measurement, and to withhold review would work considerable hardship on the company by forcing it to abandon its building plans, compromise them by agreeing to emissions limitations, or engage in a long, costly PSD review process. Moreover, EPA waived exhaustion requirements by allowing the company to promise not to increase emissions levels for the replacement kiln above those of the old kilns and by not objecting to the court's review. The court next holds that EPA's comparison between the old kilns' past pollution emissions and the replacement kiln's future capacity emissions was a reasonable interpretation of its PSD permit regulations. The regulations require calculation of the new or modified source's potential to emit, and EPA recognized that new, more efficient machinery will likely lead to increased pollution. The company's argument that EPA's interpretation arbitrarily discourages more efficient machinery that produces less pollution at any capacity is meritless. Nor is it contradictory that the regulations permit an increase in output using existing capacity as well as allow calculations of increased emissions based on new capacity. Further, EPA has not inconsistently included new and modified units in the emissions increase calculation. In one instance, internal memoranda written by different regional administrators were ambiguous about the inclusion of modified units, but EPA materials written both before, and after, the deviant letter are consistent. Moreover, no large agency can guarantee that all its administrators throughout the United States will interpret regulations identically. Finally, the court holds that EPA correctly refused to credit the company's new kiln project with contemporaneous reduction credits from an earlier project that occurred more than five years before construction on the new kiln. Additionally, the court holds that the company's challenge to the lawfulness of the regulations is untimely and should have been brought in the D.C. Circuit.

Counsel for Petitioner
Grant S. Lewis, Daniel R. Dominguez
Dominguez & Totti
Chase 416, Ste. 801, Ponce de Leon Bldg., P.O. Box 1732 Hato Rey PR 00918
(809) 753-7910

Counsel for Respondent
Michael A. McCord
Land and Natural Resources Division
U.S. Department of Justice, P.O. Box 7611, Ben Franklin Station, Washington DC 20044
(202) 633-2219

Before BOWNES and BREYER, Circuit Judges, and FAIRCHILD,^* Senior Circuit Judge.