ELR Citation: ELR 21363
No(s). 92-1569 (D.C. Cir. Aug 12, 1994)

The court holds that U.S. Environmental Protection Agency (EPA) regulations establishing federal offset requirements for outer continental shelf (OCS) sources of air pollution violate Clean Air Act (CAA) §328's requirement that such regulations be identical to those in the corresponding onshore area. Section 328 allows the relevant air pollution control authority to permit the creation of a new source of emissions only if the new source is able to secure an offsetting reduction in emissions from preexisting sources at least equal to the amount of pollution the new source could potentially generate. OCS offset regulations at issue detail the amount of offsetting reductions a new OCS source must obtain from a preexisting source, depending on where the preexisting source is located, and establish three geographic zones for application of offset "penalties" that compensate for the distance between the new OCS source and the preexisting source. Zone one includes preexisting sources located in the area seaward of 25 miles offshore; zone two covers preexisting sources in the area between 3 and 25 miles offshore; and zone three includes preexisting sources located in the area from three miles offshore extending inland.

The court first holds that EPA's interpretation of the statutory language defining OCS sources as excluding marine vessels in transit is entitled to deference. Thus, the rule does not violate §328 by failing to regulate such vessels. The court next holds that EPA's failure to subject offsets obtained from preexisting sources in zone two to the distance penalties applicable in the corresponding onshore area violates §328's requirement that offset regulations for new OCS sources located within 25 miles offshore be identical to the regulations in the corresponding onshore area. The court next holds that the regulation's treatment of all preexisting sources in zone three as if they were located three miles offshore also violates §328's requirement of identical regulations.

Counsel for Petitioner
William M. Dillon
1415 Laguna St., Santa Barbara CA 93101
(805) 564-8894

Counsel for Respondents
Jon M. Lipshultz
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000

Before BUCKLEY, WILLIAMS, and GINSBURG, Circuit Judges.