Shell Offshore, Inc. (Board decision, March 30, 2012)
In re Shell Offshore, Inc. (EAB OCS Appeal Nos. 11-05, 11-06, and 11-07): review denied
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Plain-English summary
EPA Region 10 issued Shell Offshore, Inc. a permit to construct and operate the Kulluk exploratory drilling unit and associated emission units in Alaska's Beaufort Sea, along with a Title V air-quality operating permit. Several conservation organizations, the Inupiat Community of the Arctic Slope, and an individual petitioner challenged the permit's emissions limits, PSD increment analysis, ambient-air determinations, environmental-justice analysis, comment period, and public-hearing procedures. The EAB denied review on every issue, finding that the petitioners had not shown clear error or abuse of discretion, and that one ambient-air argument had not been preserved during the comment period. The permits remained in effect.
Decision snapshot
- Cited authorities: Clean Air Act section 328, Title V, and 40 C.F.R. parts 55, 71, 52, and 124, as cited in the official order.
- Outcome: All three petitions for review were denied, and Permit No. R10 OCS030000 remained in effect.
- Key point: Petitioners must show a specific clear error, abuse of discretion, or preserved procedural issue to obtain EAB review of a complex OCS permit.
Full text (EPA EAB public release)
536 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
IN RE SHELL OFFSHORE, INC.
OCS Appeal Nos. 11-05, 11-06 & 11-07
ORDER DENYING PETITIONS FOR REVIEW
Decided March 30, 2012
Syllabus
This decision addresses petitions for review that challenge an Outer Continental
Shelf (“OCS”) Permit to Construct and Title V Air Quality Operating Permit (“Permit”) Region 10 (“Region”) of the U.S. Environmental Protection Agency (“EPA” or “Agency”) issued to Shell Offshore, Inc. (“Shell”). The Region issued the Permit on October 21, 2011, pursuant to Clean Air Act (“CAA or ”Act“) section 328, 42 U.S.C. § 7627, and applicable regulations governing air emissions from OCS sources at 40 C.F.R. part 55, and pursuant to Title V of the CAA, 42 U.S.C. § 7661, and implementing regulations at 40 C.F.R. part 71, as well as applicable Alaska code and regulatory provisions. The Permit authorizes Shell to ”construct and operate the Conical Drilling Unit Kulluk and associated air emission units and to conduct other air pollutant emitting activities“ within Shell’s lease blocks in the Beaufort Sea off the North Slope of Alaska. The Permit also provides for the use of an associated fleet of support ships, including icebreakers, supply ships, and oil spill response vessels in addition to the Kulluk.
The Board received three petitions for review of the Permit. One petition was filed
by Resisting Environmental Destruction of Indigenous Lands (“REDOIL”), Alaska Wilder- ness League, Center for Biological Diversity, Natural Resources Defense Council, North- ern Alaska Environmental Center, Oceana, Pacific Environment, Sierra Club, and the Wil- derness Society (collectively, “REDOIL Petitioners”). A second petition was filed by the In~upiat Community of the Arctic Slope (“ICAS”). The third petition was filed by Mr. Daniel Lum.
The three petitions collectively raise seven issues for review: (1) Have Petitioners
demonstrated that the Region clearly erred in establishing limitations to restrict the Kulluk drilling unit’s potential to emit? (2) Have REDOIL Petitioners demonstrated that the Re- gion clearly erred in declining to require prevention of significant deterioration (“PSD”) increment consumption analyses for the Kulluk’s proposed emissions as part of the Title V permitting process? (3) Did REDOIL Petitioners raise below their contention that Shell’s ambient air quality analysis was flawed in that it failed to conform to applicable Agency guidance? (4) Have REDOIL Petitioners demonstrated that the Region clearly erred in its ambient air exemption determination? (5) Have Petitioners demonstrated that the Region failed to satisfy its obligation to consider environmental justice under Executive Or- der 12898 and comply with applicable Board precedent? (6) Has ICAS demonstrated that the Region clearly erred or abused its discretion in providing forty-six days to comment on the draft permit and in denying ICAS’s request for non-overlapping comment periods? (7) Has ICAS demonstrated that the Region clearly erred in its public hearing procedures or that any alleged procedural deficiencies otherwise warrant review?
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Held: The Board denies review of the Permit. Petitioners have not met their burden
of demonstrating that review is warranted on any of the grounds presented.
(1) Limitations on Potential to Emit. The Board concludes that Petitioners have failed to demonstrate that the Region erred in establishing limitations to restrict the potential to emit nitrogen dioxide (“NO2”), carbon monoxide (“CO”), sulfur dioxide (“SO2”), and greenhouse gases (“GHGs”) for emission units located on the Kulluk and on the Associated Fleet when operating within twenty-five miles of the Kulluk while it is an OCS source. The Region exercised its discretion and applied its technical expertise to establish practically enforcea- ble source-wide emission limits that accommodate the substantial and unpredictable varia- tions in emissions based on the atypical nature of Shell’s operations. The Region explained in the record its rationale, based on the Region’s technical expertise and applied in certain limited circumstances, for supplementing source-specific emission factors derived for most of the emission units or groups of emission units with either AP-42 emission factors, or emission factors derived from source test data Shell submitted to the Region in support of two separate, previously issued OCS PSD permits authorizing Shell to conduct exploratory activities in the Chukchi and Beaufort Seas using the Discoverer drillship.
(2) PSD Increment Consumption Analyses. The Board concludes that REDOIL Petitioners failed to demonstrate clear error in the Region’s decision not to require PSD increment consumption analyses for the Kulluk’s proposed emissions as part of the Title V permitting process. The Board holds that the Region provided a reasonable interpretation of CAA section 504(e), which imposes permitting requirements on “temporary” stationary sources, in its Response to Comments document. The Region determined that “PSD major sources are subject to NAAQS and increment in the permitting process, whereas non-PSD sources are subject only to the NAAQS unless the applicable minor source program also includes the [PSD] increment[s].” The Region concluded that the State of Alaska’s minor source preconstruction program does not require permanent minor sources to demonstrate compli- ance with PSD increments as a condition of construction, so neither would it require such compliance of temporary minor sources. The Board finds REDOIL Petitioners’ series of challenges to this basic analysis to be deficient in a variety of ways and therefore upholds the Region’s decision.
(3) Ambient Air Quality Analysis. REDOIL Petitioners contend that Shell’s ambient air quality analysis was flawed in that it failed to conform to applicable Agency guidance. Upon examination of the administrative record, the Board concludes that REDOIL Peti- tioners failed to raise this issue during the comment period. This issue, therefore, was not preserved for review.
(4) Ambient Air Exemption Determination. The Board concludes that REDOIL Petitioners have not shown that the Region clearly erred in its decision to exempt the area within a 500 meter radius from the Kulluk – the area within the U.S. Coast Guard safety zone – from the definition of “ambient air.” The Region, in its Response to Comments, provided a reasonable interpretation of the ambient air regulation and the Agency’s longstanding inter- pretation of that regulation as applied in the OCS context.
(5) Environmental Justice Analysis. The Board concludes that ICAS and Mr. Lum have not demonstrated that the Region failed to satisfy its obligations to comply with Executive Order 12898 and applicable Board precedent. The Region conducted an environmental jus- tice analysis that demonstrated compliance with the NAAQS and endeavored to include and analyze data that is germane to the environmental justice issues raised during the com- ment period. The Region appropriately determined that it was not required to analyze the mobile source emissions from vessels that operate outside of twenty-five miles from the Kulluk while it is an OCS source where, as here, the Title V permit did not address these
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mobile source emissions, and the record lacked sufficient data for such an analysis. In addition, in the remaining arguments they put forth in their petitions, ICAS and Mr. Lum do not demonstrate how the Region’s responses to comments are inadequate, overcome the particularly heavy burden a petitioner must meet to demonstrate that review of the Region’s technical decisions is warranted, or raise issues within the Board’s jurisdiction.
(6) Public Comment Period. The Board concludes that ICAS has failed to show that the Region clearly erred or abused its discretion in either selecting a 46-day comment period or in denying ICAS’s request for nonconcurrent comment periods. The length of time the Region provided for comment on this permit was 16 days more than the 30-day regulatory minimum and 1 day more than the amount of time ICAS had specifically requested. ICAS’s attempt to recalculate the length of the comment period based on an unexplained mathematical formula involving the number and lengths of other comment periods is un- convincing. Furthermore, ICAS has not pointed to any regulations that prohibit the Agency from issuing concurrent permits or that require – or even specify – a different comment period length when the Agency does issue concurrent permits. Finally, it is clear from the administrative record that the Region appropriately balanced conflicting considerations in deciding on the length of the comment period for this permit and in denying the request for nonoverlapping periods, and ICAS has failed to demonstrate otherwise.
(7) Public Hearing. The Board concludes that ICAS has failed to demonstrate that the Re- gion clearly erred in its public hearing procedures or that any alleged procedural deficien- cies otherwise warrant review. ICAS has not shown that the Region violated any part 71 or 124 procedural regulation. Moreover, the alleged problems ICAS has identified do not, even if the Board were to find them to constitute a deficiency in some way, warrant Board review.
Before Environmental Appeals Judges Charles J. Sheehan,
Kathie A. Stein, and Anna L. Wolgast.
Opinion of the Board by Judge Stein:
Table of Contents
I. STATEMENT OF THE CASE...................................................................540 II. ISSUES..................................................................................................... ...541 III. STANDARD OF REVIEW.........................................................................541 IV. SUMMARY OF DECISION.......................................................................543 V. RELEVANT PROCEDURAL AND FACTUAL HISTORY....................544 VI. ANALYSIS .............................................................................................. ...546
A. ICAS and REDOIL Petitioners Have Not Demonstrated That the
Region Clearly Erred in Establishing Limitations to Restrict the
Kulluk Drilling Unit’s PTE...................................................................546
1. Statutory and Regulatory Context .................................................547
2. The Region Did Not Clearly Err in Establishing Source-Wide
Emission Limits to Restrict PTE for NOx and CO ......................552
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3. ICAS Has Failed to Demonstrate That the Region Clearly
Erred in Restricting the Kulluk and the Associated Fleet’s
Potential to Emit GHGs ..................................................................562
4. The Region Did Not Clearly Err in Restricting OCS Source’s
Potential to Emit SO2 ......................................................................567
5. Shell’s Minor Source Permit Is Not a “Sham” Permit...................568
B. REDOIL Petitioners Have Not Demonstrated That the Region
Clearly Erred in Declining to Require PSD Increment Consump- tion Analyses for the Kulluk’s Proposed Emissions as Part of the Title V Permitting Process ....................................................................571
1. Section 504(e) of CAA Title V Imposes Permitting Require-
ments on “Temporary” Stationary Sources .....................................571
2. Under the Region’s Interpretation, PSD Increment Compli-
ance Demonstrations Are Not Mandatory for Temporary Mi-
nor Sources but May Be Required by States .................................573
3. REDOIL Petitioners Have Not Demonstrated That the Re-
gion’s Interpretation Is Clearly Erroneous .....................................575
4. Increment Section Conclusion.........................................................581
C. REDOIL Petitioners Failed to Raise Below Their Contention That Shell’s Ambient Air Quality Analysis Was Flawed in That It Failed to Conform to Applicable Agency Guidance........................581 D. REDOIL Petitioners Have Not Demonstrated That the Region Clearly Erred in Its Ambient Air Exemption Determination ..............585 E. ICAS and Mr. Lum Have Not Demonstrated That the Region Failed to Satisfy Its Obligation to Comply with Executive Order 12898 and Applicable Board Precedent ...............................................589
1. Region’s Environmental Justice Analysis.......................................591
2. One-Hour NO2 NAAQS Analysis...................................................594
3. Ozone NAAQS Analysis.................................................................597
4. Oil Spill Response Capabilities.......................................................600
5. Impacts of Air Emissions on Traditional Subsistence Food
Sources .............................................................................................602
F. ICAS Has Failed to Demonstrate That the Region Clearly Erred or Abused Its Discretion in Providing 46 Days for Comment on the Draft Permit and in Denying ICAS’s Request for No- noverlapping Comment Periods ............................................................603 G. ICAS Has Failed to Demonstrate That the Region Clearly Erred in Its Public Hearing Procedures or That Any of the Alleged Procedural Deficiencies Otherwise Warrant Review ...........................607
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VII. CONCLUSION AND ORDER ...................................................................610
I. STATEMENT OF THE CASE
A group of conservation petitioners (“REDOIL Petitioners”),1 the In~upiat
Community of the Arctic Slope (“ICAS”), and Mr. Daniel Lum each petitioned2 the Environmental Appeals Board (“Board”) to review an Outer Continental Shelf (“OCS”) Permit to Construct and Title V Air Quality Operating Permit (“Permit”) that U.S. Environmental Protection Agency (“EPA” or “Agency”) Region 10 (“Re- gion”) had issued to Shell Offshore, Inc. (“Shell”). See generally OCS Permit to Construct and Title V Air Quality Operating Permit, Permit No. R10 OCS030000 (Oct. 21, 2011) (Administrative Record (“A.R.”) J-2). The Region issued the Per- mit pursuant to Clean Air Act (“CAA” or “Act”) section 328, 42 U.S.C. § 7627, and applicable regulations governing air emissions from OCS sources at 40 C.F.R. part 55, and pursuant to Title V of the CAA, 42 U.S.C. § 7661, and implementing regulations at 40 C.F.R. part 71, as well as applicable Alaska code and regulatory provisions.3 See Permit at 6 (citing all relevant provisions).
The Permit authorizes Shell to construct and operate the Kulluk drilling unit
and associated air emission drilling units in certain lease blocks within the Beaufort Sea. Id. at 1. The Region and Shell each filed a response to the petitions. Thereafter, both REDOIL Petitioners and ICAS filed motions requesting leave to file reply briefs. These motions are currently pending before the Board and are addressed below in Part V. The Board did not hold oral argument in this case. For the reasons discussed below, the Board denies review of the Permit.
1 REDOIL Petitioners include Resisting Environmental Destruction of Indigenous Lands
(“REDOIL”), Alaska Wilderness League, Center for Biological Diversity, Natural Resources Defense Council, Northern Alaska Environmental Center, Oceana, Pacific Environment, Sierra Club, and The Wilderness Society.
2 Mr. Lum’s petition was designated as OCS Appeal No. 11-05, REDOIL Petitioners’ petition
was designated as OCS Appeal No. 11-06, and ICAS’s petition was designated as OCS Appeal No. 11-07.
3 The Permit was issued under multiple CAA and Alaska air pollution provisions because it is
a consolidation of three air permits. According to the Region, it consolidated “an OCS/Title V permit under 40 CFR Parts 55 and 71 for operations beyond 25 miles of Alaska’s seaward boundary; an OCS/minor permit for air quality protection under 40 CFR Part 55 and 18 Alaska Administrative Code (AAC) 50.502 and for owner requested limitations under 40 CFR Part 55 and 18 AAC 50.508 for operations within 25 miles of Alaska’s seaward boundary; and an OCS/Title V permit under 40 CFR Part 55 and 18 AAC 50.326 for operations within 25 miles of Alaska’s seaward boundary.” Response to Comments for OCS Permit to Construct and Title V Air Quality Operating Permit Conical Drilling Unit Kulluk at 1 (A.R. J-3).
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II. ISSUES
The Board has determined that the three petitions filed in this case, collec-
tively, present the following seven issues for review:
A. Have Petitioners demonstrated that the Region clearly erred in estab-
lishing limitations to restrict the Kulluk drilling unit’s potential to
emit?
B. Have REDOIL Petitioners demonstrated that the Region clearly erred
in declining to require PSD increment consumption analyses for the
Kulluk’s proposed emissions as part of the Title V permitting process?
C. Did REDOIL Petitioners raise below their contention that Shell’s am-
bient air quality analysis was flawed in that it failed to conform to
applicable Agency guidance?
D. Have REDOIL Petitioners demonstrated that the Region clearly erred
in its ambient air exemption determination?
E. Have Petitioners demonstrated that the Region failed to satisfy its ob-
ligation to consider environmental justice under Executive Or-
der 12898 and comply with applicable Board precedent?
F. Has ICAS demonstrated that the Region clearly erred or abused its
discretion in providing 46 days to comment on the draft permit and in
denying ICAS’s request for nonoverlapping comment periods?
G. Has ICAS demonstrated that the Region clearly erred in its public
hearing procedures or that any alleged procedural deficiencies other-
wise warrant review?
III. STANDARD OF REVIEW
Under the part 124 procedural regulations, which apply to OCS permits,4
the Board will not ordinarily review a permit unless it is based on a clearly erro- neous finding of fact or conclusion of law, or involves a matter of policy or exer- cise of discretion that warrants review. 40 C.F.R. § 124.19(a); Consolidated Per-
4 The OCS regulations direct the Agency to follow the applicable part 124 permit regulations
in processing OCS permits. 40 C.F.R. § 55.6(a)(3). Accordingly, the part 124 permit appeal provision, 40 C.F.R. § 124.19, applies here. See In re Shell Gulf of Mex., Inc., 15 E.A.D. 470, 476 (EAD 2012)
[hereinafter Shell Discoverer 2012].
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mit Regulations, 45 Fed. Reg. 33,290, 33,412 (May 19, 1980). The Board also applies this standard in reviewing Title V permits issued under part 71.5 See 40 C.F.R. § 71.11(l)(1); In re Peabody W. Coal Co., 12 E.A.D. 22, 32-33 (EAB 2005). When analyzing permits, the Board is cognizant of the preamble to section 124.19, in which the Agency states that the Board’s power of review “should be only sparingly exercised” and that “most permit conditions should be finally determined at the [permit issuer’s] level.” Consolidated Permit Regula- tions, 45 Fed. Reg. at 33,412; accord In re Cardinal FG Co., 12 E.A.D. 153, 160 (EAB 2005); see also Peabody, 12 E.A.D. at 33 (applying these same principles in the context of a part 71 permit appeal).
The petitioner bears the burden of demonstrating that review is warranted.
See 40 C.F.R. § 124.19; id. § 71.11(l)(1). To meet this burden, the petitioner must satisfy threshold pleading requirements including timeliness, standing, and issue preservation. See 40 C.F.R. § 124.19; id. § 71.11(l)(1); In re Russell City Energy Ctr., LLC (“Russell City II”), 15 E.A.D. 1, 10 (EAB 2010), appeal docketed sub nom. Chabot-Las Positas Cmty. Coll. Dist. v. EPA, No. 10-73870 (9th Cir. Dec. 20, 2010); In re BP Cherry Point, 12 E.A.D. 209, 216 (EAB 2005). For example, a petitioner seeking review must file an appeal of the permit decision within 30 days of service of the decision, and must have filed comments on the draft permit or participated in the public hearing. 40 C.F.R. § 124.19(a); accord Russell City II, 15 E.A.D. at 10. In addition, a petitioner must not only specify objections to the permit, but also explain why the permit issuer’s previous re- sponse to those objections is clearly erroneous or otherwise warrants review. See 40 C.F.R. § 124.13 (requiring that all persons who believe a condition of a draft permit is inappropriate “must raise all reasonably ascertainable issues and submit all reasonably available arguments supporting their position by the close of the public comment period”); id. § 124.19(a) (stating that a petition for review to the Board “shall include * * * a demonstration that any issues being raised were raised during the public comment period”); see also In re Avenal Power Ctr., LLC, 15 E.A.D. 384, 387 (EAB 2011), appeals docketed sub nom. Sierra Club v. EPA, No. 11-73342 (9th Cir. Nov. 3, 2011), El Pueblo Para el Aire y Agua Limpio v. EPA, No. 11-73356 (9th Cir. Nov. 4, 2011); BP Cherry Point, 12 E.A.D. at 216-17. The petitioner’s burden is particularly heavy in cases where a petitioner seeks review of an issue that is fundamentally technical or scientific in nature, as the Board will typically defer to a permit issuer’s technical expertise and experience on such matters if the permit issuer adequately explains its ratio- nale and supports its reasoning in the administrative record. See, e.g., In re Do- minion Energy Brayton Point, LLC, 12 E.A.D. 490, 510 (EAB 2006); Peabody, 12 E.A.D. at 33-34; In re NE Hub Partners, L.P., 7 E.A.D. 561, 567-68 (EAB
5 The part 71 regulatory language governing Title V permit appeals is nearly identical to the
part 124 regulatory language governing review of other types of permits. Compare 40 C.F.R.
§ 71.11(l)(1) with 40 C.F.R. § 124.19; see also Peabody, 12 E.A.D. at 33 n.26.
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1998), review denied sub nom. Penn Fuel Gas, Inc. v. EPA, 185 F.3d 862 (3rd Cir. 1999); see also In re Ash Grove Cement Co., 7 E.A.D. 387, 404 (EAB 1997).
When evaluating a permit appeal, the Board examines the administrative
record prepared in support of the permit to determine whether the permit issuer exercised his or her “considered judgment.” Ash Grove Cement, 7 E.A.D. at 417-18; accord In re Cape Wind Assocs., LLC, 15 E.A.D. 327, 330 (EAB 2011); In re GSX Servs. of S.C., Inc., 4 E.A.D. 451, 454 (EAB 1992). The permit issuer must articulate with reasonable clarity the reasons supporting its conclusion and the significance of the crucial facts it relied upon when reaching its conclu- sion. E.g., In re Shell Offshore, Inc. (“Shell 2007”), 13 E.A.D. 357, 386 (EAB 2007) (citing In re Carolina Light & Power Co., 1 E.A.D. 448, 451 (Act’g Adm’r 1978)); Ash Grove Cement, 7 E.A.D. at 417 (same). As a whole, the record must demonstrate that the permit issuer “duly considered the issues raised in the comments and [that] the approach ultimately adopted by the [permit issuer] is rational in light of all information in the record.” In re Gov’t of D.C. Mun. Sepa- rate Storm Sewer Sys., 10 E.A.D. 323, 342 (EAB 2005); accord In re City of Moscow, 10 E.A.D. 135, 142 (EAB 2001); NE Hub, 7 E.A.D. at 568.
Finally, the Board endeavors to construe liberally objections raised by par-
ties unrepresented by counsel (i.e., those proceeding pro se), so as to fairly iden- tify the substance of the arguments being raised. In re Sutter Power Plant, 8 E.A.D. 680, 687 & n.9 (EAB 1999); accord In re Shell Gulf of Mex., Inc. (“Shell Discoverer 2012”), 15 E.A.D. 470, 478 (EAB 2012); Russell City II, 15 E.A.D. at
-
While the Board does not expect such petitions to contain sophisticated legal
arguments or to utilize precise technical or legal terms, the Board nonetheless expects such petitions “to articulate some supportable reason or reasons as to why the permitting authority erred or why review is otherwise warranted.” Sutter, 8 E.A.D. at 687-88 (citing In re Beckman Prod. Servs., 5 E.A.D. 10, 19 (EAB 1994)).IV. SUMMARY OF DECISIONFor all of the reasons stated below, the Board concludes that: (a) Petitioners
failed to demonstrate that the Region clearly erred in establishing limits to restrict the Kulluk’s potential to emit; (b) REDOIL Petitioners failed to demonstrate that the Region clearly erred in declining to require PSD increment consumption anal- yses for the Kulluk’s proposed emissions as part of the Title V permitting process; (c) REDOIL Petitioners failed to raise below their contention that Shell’s ambient air quality analysis was flawed in that it failed to conform to applicable Agency guidance; (d) REDOIL Petitioners failed to demonstrate that the Region clearly erred in its ambient air exemption determination; (e) Petitioners have not demon- strated that the Region’s environmental justice analysis and related conclusionsVOLUME 15544 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
failed to satisfy its obligation to comply with Executive Order 12898 and applica- ble Board precedent; (f) ICAS failed to demonstrate that the Region clearly erred or abused its discretion in providing 46 days to comment on the draft permit and in denying ICAS’s request for nonoverlapping comment periods; and (g) ICAS failed to demonstrate that the Region clearly erred in its public hearing procedures or that any alleged procedural deficiencies otherwise warrant review. Accord- ingly, the Board denies review of the Permit.
V. RELEVANT PROCEDURAL AND FACTUAL HISTORY
On July 22, 2011, the Region issued a draft permit consolidating three per-
mits that regulated air pollution from Shell’s proposed exploratory drilling opera- tions on OCS lease blocks in the Beaufort Sea off the North Slope of Alaska, as authorized by the United States Bureau of Ocean Energy Management, Regula- tion and Enforcement (“BOEMRE”).6 The Region solicited public comment on the draft permit from July 22, 2011, through September 6, 2011. See Statement of Basis for Draft OCS Permit to Construct and Title V Air Quality Operating Per- mit (“Statement of Basis”) at 10 (A.R. H-4). In addition, the Region held an infor- mational meeting and public hearing on the draft permit on August 23, 2011, in Barrow, Alaska, and a separate public hearing on August 26, 2011, in Anchorage, Alaska. Id. at 11. All of the petitioners submitted comments on the draft permit. See E-mail from Daniel Lum to EPA Region 10 (Aug. 10, 2011) (A.R. I-31)
[hereinafter Lum Comments]; E-mail from Alaska Wilderness League, Audubon Alaska, Center for Biological Diversity, Defenders of Wildlife, Earthjustice, Eyak Preservation Council, Greenpeace, National Wildlife Federation, Natural Re- sources Defense Council, Northern Alaska Environmental Center, Ocean Conser- vancy, Oceana, Pacific Environment, REDOIL, Sierra Club, The Wilderness So- ciety, and World Wildlife Fund to EPA Region 10 (Sept. 6, 2011) (A.R. I-53)
[hereinafter REDOIL Comments]; Letter from North Slope Borough, AEWC, and ICAS to Doug Hardesty, Air Permits Project Manager, EPA Region 10 (Sept. 6, 2011) (A.R. I-54) [hereinafter ICAS Comments]; see also Lum Petition at 1 (not- ing that he also provided comments at the public hearing).
On October 21, 2011, the Region issued the Permit. See Permit at 1. At the
same time, the Region issued a response to both the written comments it had re- ceived on the draft permit and the oral comments that had been presented at the public hearings. See generally Response to Comments for OCS Permit to Con- struct and Title V Air Quality Operating Permit Conical Drilling Unit Kulluk (“RTC”) (A.R. J-3); see id. at 2 (describing comments to which the document responded). The Permit authorizes Shell to conduct air pollutant emitting activi- ties for the purpose of oil exploration with the conical drilling unit Kulluk on lease
6 For a description of the three permits, see supra note 3.
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blocks in the Beaufort Sea. The Permit provides for the use of an associated fleet of support vessels (“Associated Fleet”), such as icebreakers, oil spill response ves- sels (“OSRVs”), and a supply ship, in addition to the Kulluk.
The Board received three timely petitions for review of the Permit: one
from Mr. Lum, one from REDOIL Petitioners, and one from ICAS. The Region and Shell each filed a single response to those petitions. ICAS and REDOIL Peti- tioners each filed motions requesting leave to file reply briefs and attached their proposed reply briefs. Shell filed an opposition to the motions for leave to file replies. Before addressing the issues raised by the petitions, the Board first con- siders whether it is appropriate to grant Petitioners’ motions.
A petitioner seeking leave to file a reply brief in an appeal of a new source
review (“NSR”) permit issued pursuant to the CAA, such as the OCS Permit at issue here, must state “with particularity the arguments to which the Petitioner seeks to respond and the reasons the Petitioner believes it is both necessary to file a reply to those arguments * * * and how those reasons overcome the presump- tion in the Standing Order.”7 Shell Discoverer 2012, 15 E.A.D. at 481 (citing Or- der Governing Petitions for Review of Clean Air Act New Source Review Permits 3 (Apr. 19, 2011) (“Standing Order”), available at http://www.epa.gov/eab (click on Standing Orders)).
Upon consideration of Petitioners’ motions to file reply briefs and proposed
reply briefs, the Board finds that only two select issues within REDOIL Petition- ers’ and ICAS’s reply briefs meet the high threshold required to overcome the presumption against reply briefs that the Board applies in NSR appeals. See Standing Order at 3. In particular, in its reply brief, ICAS responds to arguments concerning ICAS’s challenge to the public hearing procedures that the Region ad- vances for the first time in the response brief. ICAS could not have responded to these particular arguments prior to the Region’s response because a portion of the Region’s rationale in its response brief does not appear in the administrative re- cord. In addition, both ICAS and REDOIL Petitioners assert that the Region refer- enced for the first time in its response a decision by the Administrator as support for the Region’s rationale that the Agency has previously concluded that rolling emission limits accompanied by prescribed emission factors and appropriate mon- itoring and recordkeeping sufficiently restrict a source’s potential to emit. See Re- gion Response at 17 (citing In re Pope & Talbot, Inc., Petition No. VIII-2006-04 (Adm’r 2007) (A.R. B-24)). ICAS and REDOIL Petitioners did not have an op-
7 In April 2011, the Board issued a standing order in which it adopted certain procedures in-
tended to facilitate expeditious resolution of petitions requesting review of permits issued under the CAA NSR program, including OCS permits. See Standing Order at 1 n.2; see also 40 C.F.R. § 124.19. Among other things, the Board will apply a presumption against the filing of reply briefs and sur-replies in NSR appeals. See Standing Order at 3. However, the Board maintains discretion to mod- ify these procedures as appropriate on a case-specific basis. Id. at 6.
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portunity to review the Administrator’s decision in the context of this appeal or to analyze its relevance to the Region’s stated rationale until the Region cited it for support in its response brief. Accordingly, the Board grants, in part, ICAS’s and REDOIL Petitioners’ motions for leave to file a reply brief. Thus the Board, in reaching its conclusions set forth in this order, has considered the portions of ICAS’s reply brief and REDOIL Petitioners’ reply brief that address the public process for the permit and the Region’s inclusion of the Pope & Talbot decision as support for the Region’s PTE decisions. See ICAS Reply at 3, 6-7; REDOIL Peti- tion at 9-10. The Board denies REDOIL Petitioners’ and ICAS’s motions for leave to file a reply brief with respect to all other issues.8
The Board analyzes the parties’ arguments and sets forth its determinations
below.
VI. ANALYSIS
A. ICAS and REDOIL Petitioners Have Not Demonstrated That the Region Clearly Erred in Establishing Limitations to Restrict the Kulluk Drilling Unit’s PTE
ICAS and REDOIL Petitioners both challenge the Region’s determination
of the Kulluk’s potential to emit (“PTE”) and argue that the Region should require Shell to obtain a preconstruction prevention of significant deterioration (“PSD”) permit. They complain that the PTE restrictions Shell requested and the Region included in the permit to ensure that the Kulluk remains a synthetic minor source for nitrogen oxides (“NOx”), carbon monoxide (“CO”), greenhouse gases (“GHGs”), and sulfur dioxide (“SO2”) are practically unenforceable.9 The Region counters that the restrictions it imposed in the permit that reduce Shell’s emissions below the PSD threshold levels for all criteria pollutants are practically enforcea- ble and constitute fundamentally technical decisions that are consistent with CAA statutory and regulatory authority as well as Agency guidance and past practice. This PTE question is central to the Board’s analysis because the Region uses the potential to emit to determine which provisions of the CAA, including both the Title V permit requirements and the PSD preconstruction permit requirements, apply to the Kulluk. The question the Board must resolve, then, is whether the restrictions the Region included in the permit to limit the Kulluk’s PTE are both
8 The Board notes that Mr. Lum attempted to file by e-mail a request to file a reply brief and a
request for oral argument. See E-mail from Daniel Lum to Eurika Durr, Clerk of the Board, Environ- mental Appeals Board, U.S. EPA (Nov. 4, 2011 6:18 pm EDT). The Board denies Mr. Lum’s requests.
9 While ICAS challenges the Region’s PTE limitations for all of these pollutants, REDOIL
Petitioners only challenge the Region’s PTE limitations with respect to NOx and CO. See ICAS Peti- tion at 10-28; REDOIL Petition at 9-14.
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practically enforceable and reasonable in light of the applicable statutory and reg- ulatory authorities as well as Agency guidance and practice, and whether the Re- gion provided adequate support for its decisions in the administrative record.
Before addressing the parties’ arguments, a brief review of the relevant stat-
utory and regulatory authorities is warranted.
1. Statutory and Regulatory Context
a. CAA Section 328 and OCS Air Regulations
Section 328 of the CAA, 42 U.S.C. § 7627, establishes air pollution controls
for OCS sources10 and requires OCS sources to “attain and maintain Federal and State ambient air quality standards” and to comply with the PSD provisions con- tained in CAA Title I, part C. EPA promulgated the Outer Continental Shelf Air Regulations, 40 C.F.R. part 55, to implement CAA section 328 and established within part 55 “the air pollution control requirements for OCS sources and the procedures for implementation and enforcement of the requirements.” 40 C.F.R.
§ 55.1.
Section 328(a)(1), 42 U.S.C. § 7627(a)(1), also requires that, for OCS
sources located within 25 miles of a state’s seaward boundary, the requirements shall be the same as would apply if the source were located in the corresponding onshore area (“COA”), including, but not limited to, state and local requirements for emission controls, emission limitations, offsets, permitting, monitoring, test- ing, and reporting. As the Board has explained before, “OCS sources must obtain
10 Section 328 defines an OCS source as follows:
The terms “Outer Continental Shelf source” and “OCS source” include
any equipment, activity, or facility which –
(i) emits or has the potential to emit any air pollutant,
(ii) is regulated or authorized under the Outer Continental Shelf Lands
Act [43 U.S.C. § 1331 et seq.], and
(iii) is located on the Outer Continental Shelf or in or on waters above
the Outer Continental Shelf.
Such activities include, but are not limited to, platform and drill ship
exploration, construction, development, production, processing, and
transportation. For purposes of this subsection, emissions from any ves-
sel servicing or associated with an OCS source, including emissions
while at the OCS source or en route to or from the OCS source within 25
miles of the OCS source, shall be considered direct emissions from the
OCS source.
CAA § 328(a)(4)(C), 42 U.S.C. § 7627(a)(4)(c).
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a preconstruction permit from either EPA or an EPA-delegated agency if the OCS source is located within twenty-five miles of a state’s seaward boundary and is subject to either federal or state requirements listed in 40 C.F.R. §§ 55.13 or 55.14.”11 Shell 2007, 13 E.A.D. at 365 (citing 40 C.F.R. §§ 55.6(b)(1), 55.11 and CAA § 328(a)(3), 42 U.S.C. § 7627(a)(3)). The Agency has retained the authority to implement and enforce section 328 in the OCS off the coast of Alaska as op- posed to delegating that authority to the state. Accordingly, as mentioned above, Shell submitted its permit applications to the Region, and the procedural rules contained at 40 C.F.R. part 124 apply. 40 C.F.R. § 55.6(a)(3).
Because requirements for these OCS sources are based on onshore require-
ments, which may change, section 328(a)(1) and the corresponding regulations in part 55 require EPA to update the OCS requirements as necessary to maintain consistency with onshore requirements. See CAA § 328(a)(1), 42 U.S.C.
§ 7627(a)(1); 40 C.F.R. §§ 55.6(b)(2), 55.12; see also Shell 2007, 13 E.A.D. at 364 & n.6. In response to Shell’s December 10, 2010, notice of intent submitted to the Agency pursuant to 40 C.F.R. § 55.4, the Agency first proposed in the Fed- eral Register a consistency update on February 10, 2011, and later published the final consistency update on June 27, 2011, subsequent to a public notice and com- ment period. See Outer Continental Shelf Air Regulations Consistency Update for Alaska, 76 Fed. Reg. 37,274 (June 27, 2011) (codified at 40 C.F.R. § 55.14(e) & appx. A); Statement of Basis at 17. This most recent consistency update incorpo- rated, except where specifically noted, Alaska Administrative Code title 18, arti- cles 1 through 5 and article 9, into part 55. 76 Fed. Reg. at 37,279-80; Statement of Basis at 17. In particular, articles 3 and 5 establish the minor source and major source permitting requirements with which the Kulluk must comply. See Shell 2007, 13 E.A.D. at 364 & n.6.
In addition, because the permit authorizes the Kulluk to operate on a group
of lease blocks located both within 25 miles and beyond 25 miles of the state’s seaward boundary, the permit conditions that refer to lease blocks wholly or par- tially located beyond 25 miles of the seaward boundary are designated as “outer
11 Section 55.13 states, among other things, that the PSD program applies to OCS sources
located within 25 miles of a state’s seaward boundary whenever the OCS source requires construction of a new major stationary source or a modification at an existing major source and the COA is classi- fied under the PSD program as in attainment or unclassifiable. 40 C.F.R. § 55.13(d)(1) (“40 C.F.R.
[§ ] 52.21 shall apply to OCS sources [l]ocated within 25 miles of a state’s seaward boundary if the requirements of 40 C.F.R. [§ ] 52.21 are in effect in the COA.”); see also Shell 2007, 13 E.A.D. at 364.
Section 55.14 incorporates by reference regulatory requirements that states which border the
OCS in the Pacific, Atlantic, and Arctic Oceans and the Gulf of Mexico have promulgated to meet the national ambient air quality standards (“NAAQS”). 40 C.F.R. § 55.14(d); CAA § 328(a)(1), 42 U.S.C.
§ 7627(a)(1) (defining the geographic scope of EPA authority to regulate air pollution from OCS sources). These state regulations are known as state implementation plans (“SIPs”) and are created pursuant to CAA § 110, 42 U.S.C. § 7410.
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OCS,” and conditions that refer to lease blocks wholly or partially located within 25 miles of the seaward boundary are designated as “COA.” Permit at 9 (noting that conditions identified with “COA” are those that apply on the “inner OCS,” within 25 miles of the state’s seaward boundary, and that all other conditions not identified as “COA” or “outer OCS” apply to lease blocks on both the inner and outer OCS); see also Statement of Basis at 7.
b. The PSD Program and PTE
The PSD program is a preconstruction NSR program that applies to areas
designated as either in attainment with the national ambient air quality standards (“NAAQS”)12 or unclassifiable and requires new major stationary sources13 to limit their impact on ambient air quality by obtaining a PSD permit before con- struction begins. CAA §§ 160-169, 42 U.S.C. §§ 7470-7479; 40 C.F.R.
§ 52.21(a)(2).
A source’s PTE relates to its inherent ability to emit air pollutants.
Shell 2007, 13 E.A.D. at 365; Peabody, 12 E.A.D. at 30. Under the PSD program, a permitting authority must determine a source’s PTE to identify which sources are “major sources” subject to regulation under the applicable PSD requirements, making PTE a technical determination that “is jurisdictional in nature.” Ala. Power Co. v. Costle, 636 F.3d 323, 352 (D.C. Cir. 1979), quoted in Peabody, 12 E.A.D. at 30; see also CAA § 165(a), 42 U.S.C. § 7475(a) (requiring a PSD permit for any “major emitting facility”); Shell Discoverer 2012, 15 E.A.D. at 515 n.58. The regulations that implement the PSD program define PTE as:
12 The NAAQS are maximum ambient air concentrations for specific pollutants that EPA has
determined are necessary to protect public health and welfare. See CAA §§ 108(a)(1)(A), 109, 42 U.S.C. §§ 7408(a)(1)(A), 7409; 40 C.F.R. § 50.4-.12.
13 EPA regulations define a major stationary source as any of certain specifically listed station-
ary sources that emit or have a potential to emit 100 tons per year (“tpy”) or more of any regulated NSR pollutant, see 40 C.F.R. § 52.21(b)(50), or any other stationary source that emits, or has the potential to emit, 250 tpy or more of a regulated NSR pollutant. 40 C.F.R. § 52.21(b)(1)(i)(a)-(b); accord CAA § 169(1), 42 U.S.C. § 7479(1) (defining a “major emitting facility” in the same way).
Alaska regulations, which incorporate large parts of the federal PSD regulations into title 18 of
the Alaska Administrative Code, provide that a new PSD permit is required prior to actual construc- tion of a new major stationary source. Alaska Admin. Code tit. 18, § 50.040 (adopting federal stan- dards by reference); id. §§ 50.302(a)(1), 50.306. The Alaska regulations also define a major stationary source as any of certain specifically listed stationary sources that emit or have a potential to emit 100 tpy or more of any regulated NSR pollutant, or any other stationary source that emits, or has the potential to emit, 250 tpy or more of a regulated NSR pollutant. Id. § 50.990(52) (incorporating by reference definition of major stationary source from 40 C.F.R. § 51.166(b)(1)); accord Alaska Stat.
§ 46.14.990 (same).
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550 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
[T]he maximum capacity of a stationary source to emit a
pollutant under its physical and operational design. Any
physical or operational limitation on the capacity of the
source to emit a pollutant, including air pollution control
equipment and restrictions on hours of operation or on the
type or amount of material combusted, stored, or
processed, shall be treated as part of its design if the limi-
tation or the effect it would have on emissions is federally
enforceable.
40 C.F.R. § 52.21(b)(4).14 In sum, PTE reflects a source’s maximum emissions capacity considering the application of any emission control equipment, or other capacity-limiting restrictions, that effectively and enforceably limit emissions ca- pacity. Shell 2007, 13 E.A.D. at 366; Peabody, 12 E.A.D. at 31 (citing Part 71 Rulemaking, 61 Fed.Reg. 34,202, 34,212 (July 1, 1996)).
Alaska regulations require that, under certain circumstances, a stationary
source with a PTE of less than 250 tons per year (“tpy”) obtain a minor source permit. Alaska Admin. Code tit. 18, § 50.502. Specifically in terms of the Kulluk’s operations, Alaska regulations require a minor source permit prior to the construc- tion of a new stationary source with the potential to emit more than 40 tpy of NOx. Id. § 50.502(c)(1)(B). Thus, as the Board noted in Shell 2007, under the Alaska PSD program, a new stationary source that has a PTE between 40 and 250 tpy of NOx must obtain a minor source permit before commencing construction, and a stationary source with a PTE greater than 250 tpy of NOx must obtain a major source permit. 13 E.A.D. at 366.
A source that would otherwise exceed the applicable PSD major source
threshold of 250 tpy of any regulated NSR pollutant may, as in this instance, seek to avoid regulation as a major source under the PSD program by requesting that the permitting authority impose enforceable permit restrictions on the source’s PTE. Shell 2007, 13 E.A.D. at 366, cited in RTC at 20; see also Peabody, 12 E.A.D. at 26 & n.11, 31. A Title V permit may function as a vehicle for a permitting authority to establish enforceable permit limits that restrict the source’s potential to emit air pollutants to a level below the PSD major source threshold, in this instance 250 tpy, allowing the source to qualify instead as a “synthetic minor” source.15 Peabody, 12 E.A.D. at 31 & n.21.
14 The OCS regulations define the term “potential emissions” almost identically to the PTE
definition in part 52, with the exception of first sentence, which instead states that “[p]otential emis- sions means the maximum emissions of a pollutant from an OCS source.” 40 C.F.R. § 55.2.
15 EPA guidance defines the term “synthetic minor” as “air pollution sources whose maximum
capacity to emit air pollution under their physical and operational design is large enough to exceed the
Continued
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If a source accepts limitations that restrict its potential to emit air pollutants
to a level below the PSD threshold, that source will be a synthetic minor source for purposes of the PSD program and will therefore not be subject to PSD permit- ting requirements “unless future facility modifications increase emission capacity enough to exceed the PSD major source threshold.” Id. at 31-32. As the Board noted in Peabody, in order for a capacity restriction to be cognizable as a PTE limit, it must be practically enforceable, which Agency guidance has interpreted to mean that:
[T]he permit’s provisions must specify: (1) a technically
accurate limitation and the portions of the source subject
to the limitation; (2) the time period for the limitation
(hourly, daily, monthly, and annual limits such as rolling
annual limits); and (3) the method to determine compli-
ance including appropriate monitoring, recordkeeping,
and reporting.
12 E.A.D. at 32 (quoting Memorandum from John Seitz, Dir., Office of Air Qual- ity Planning & Standards, U.S. EPA, to EPA Reg’l Air Div. Dirs., Options for Limiting the Potential to Emit (PTE) of a Stationary Source Under Section 112 and Title V of the Clean Air Act 5-6 (Jan. 25, 1995) [hereinafter Options for Limit- ing PTE] (A.R. B-9)).
In this instance, the pre-permit PTE for units located on the Kulluk, and on
the Associated Fleet when operating within 25 miles of the Kulluk while it is an OCS source,16 exceeded applicable PSD thresholds for NOx, CO, SO2, and GHGs. Statement of Basis at 24-25 & tbl. 2-1.17 To avoid exceeding the PSD major
(continued)
major source threshold but [is] limited by an enforceable emissions restriction that prevents this physi- cal potential from being realized.” Memorandum from John Seitz, Dir., Office of Air Quality Planning
& Standards, U.S. EPA, & Eric Schaeffer, Dir., Office of Regulatory Enforcement, U.S. EPA, Poten- tial to Emit Transition Policy for Part 71 Implementation in Indian Country 2 n.2 (Mar. 7, 1999), quoted in Shell Discoverer 2012, 15 E.A.D. at 515-16 n.59, and Peabody, 12 E.A.D. at 31 n.21.
Alaska regulations refer to such a limitation as an owner requested limit (“ORL”), which can be
used to “avoid one or more permit classifications * * * at a stationary source that will still be subject to at least one permit classification; a limitation approved under an ORL is an enforceable limitation for the purpose of determining * * * a stationary source’s potential to emit.” Alaska Admin. Code tit. 18, § 50.508(5).
16 The permit states that the Kulluk will be an OCS source at any time it is attached to the
seabed at a drill site by at least one anchor. Permit at 8; Statement of Basis at 17, 19-20 (A.R. H-4).
17 The primary emission sources on the Kulluk and the Associated Fleet are internal combus-
tion engines that consume diesel fuel. Statement of Basis at 9, 12-14. Incinerators, heaters, boilers, and seldom used sources on the Kulluk and the Associated Fleet also emit pollution but to a far lesser extent. Id.
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552 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
source thresholds, Shell requested that the Region include in the permit practically enforceable restrictions that will reduce the Kulluk’s PTE below PSD threshold levels for each of the four pollutants. See Letter from Susan Childs, Alaska Ven- ture Support Integrator Manager, Shell Offshore Inc., to Doug Hardesty, EPA Re- gion 10, attach. 2 (Apr. 29, 2011) (describing Shell’s proposed restrictions and how they would affect emissions) (A.R. E-17). The final permit authorizing the Kulluk to operate within the Beaufort Sea contains source-wide emission limits, operational restrictions, and monitoring, recordkeeping and reporting require- ments intended to ensure that the Kulluk can operate as a synthetic minor source. Permit Conditions D.1-D.4.
With this framework in mind, the Board now turns its attention to Petition-
ers’ arguments presented in these appeals.
2. The Region Did Not Clearly Err in Establishing Source-Wide
Emission Limits to Restrict PTE for NOx and CO
The Permit restricts emissions from the Kulluk and the Associated Fleet to
no more than 240 tpy of NOx and no more than 200 tpy of CO.18 Permit Condi- tions D.4.1, D.4.2. For both pollutants, the PTE limits are determined on a rolling 365-day basis by calculating emissions for each day and adding the emissions calculated for the previous 364 days. Id. For both NOx and CO, daily emissions from each emission unit or group of emission units “shall be determined by multi- plying the appropriate emission factor (lb/unit) specified in Tables D.2.1 – D.2.2 (until a test-derived emission factor has been determined according to Permit Condition E.2) by the recorded daily operation rate (units/day) and dividing by 2000 lb/ton.” Id. The Region further explained that “[c]ompliance with the emis- sions limits for NOx and CO is determined by applying the relevant emission fac- tor to the amount of fuel combusted by each emission unit (or hours of operation for incinerators).” RTC at 29. The Permit also includes conditions that require source-wide recordkeeping and monitoring to ensure that Shell complies with the source-wide limits. Permit at 56-61 (including operations and fuel monitoring in Permit Condition F.2 as well as selective catalytic reduction (“SCR”) and oxida-
18 ICAS asserts that the Region should include a 5-10% buffer zone between the PSD thresh-
old emissions level of 250 tpy and the Kulluk’s restricted PTE, and that the NOx emission limit of 240 tpy does not provide this. ICAS Petition at 15 (citing a comment letter from Region 9 to the Nevada Division of Environmental Protection in which Region 9 “encourage[d] a 5-10% buffer be- tween the permitted emission limits and the federal threshold” for a permit that established a CO syn- thetic minor limit of 249 tpy). However, the 240 tpy emission limit for NOx contained in the current Permit represents a 4% buffer between the synthetic minor limit and the PSD threshold emission level of 250 tpy, which is ten times larger than the 0.4% buffer between a 249 tpy emission limit and the PSD threshold of 250 tpy contained in the Nevada permit. The Board agrees with the Region that Congress established specific thresholds to determine when a source would be considered major for purposes of PSD review. See RTC at 30. The buffer that ICAS requests is neither a legal requirement nor an established Agency policy, and thus the Region appropriately declined ICAS’s request.
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tion catalyst (“OxyCat”) control device monitoring in Permit Conditions F.3 – F.4).
REDOIL Petitioners and ICAS make several challenges to the Region’s de-
cision to restrict the Kulluk’s PTE for NOx and CO using source-wide emission limits. Both petitioners assert that the Region’s decision to limit CO and NOx emissions using source-wide limits in effect applies blanket emission limits, which Agency guidance expressly prohibits because they are practically unen- forceable, and that the limited exception in the Agency guidance that allows for source-wide limits is inapplicable to the Kulluk’s operations. REDOIL Petition at 10-11; ICAS Petition at 11. Both petitioners also object to the Region’s use of generic emission factors19 to calculate source-wide emission limits. In particular, both petitioners assert that (1) the Region should have developed source-specific emission factors for all units of the OCS source; (2) the AP-42 emission factors applied to the emergency generator, the OSRVs, and heaters and boilers lead to inaccurate and underestimated emissions for those sources; and (3) the Region did not require Shell to conduct enough stack tests to accurately calculate source-specific emission factors. ICAS Petition at 15-20; REDOIL Petition at 11-14.
The Region responds that Agency guidance documents generally “illustrate
that the Clean Air Act and the implementing regulations allow for a flexible, case-by-case evaluation of appropriate methods for ensuring practical enforceabil- ity of PTE limits.” Region Response at 14-15 (quoting In re Orange Recycling & Ethanol Prod. Facility, Pet. No. II-2001-05, at 5 (Adm’r Apr. 8, 2002) (A.R. B-17)). Specifically, the Region asserts that source-wide emission limits for NOx and CO are indeed practically enforceable and are most appropriate given the uncertainty of a number of factors that otherwise preclude the Region from estab- lishing PTE restrictions based on operational limits. Id. at 18; RTC at 26-27, 29-30. In addition, the Region asserts that the emission factors used to calculate NOx and CO emissions provide reliable emission calculations. Region Response at 19-23. In particular, the Region asserts that it made an appropriate technical determination to apply AP-42 emission factors or emission factors derived from Discoverer20 data rather than source-specific emission factors for certain emission units. Id. The Region adds that the permit conditions that apply to source-specific
19 See infra Part VI.A.2.b.
20 The Region issued Shell two OCS PSD permits to conduct exploratory drilling activities in
the Chukchi and Beaufort Seas utilizing the drillship Discoverer that were twice appealed to the Board, first in 2010, and then again in 2011 subsequent to a Board remand of the permits to the Region. See Shell Discoverer 2012, 15 E.A.D. at 474-75 (describing history of Discoverer permit proceedings). In preparing the permit applications for the Discoverer’s operations, Shell conducted source-specific emission tests for various emission units on the Discoverer and an associated fleet of support ships, including icebreakers, supply ships, and oil spill response vessels. See id., 15 E.A.D. at 479-80 (describing associated fleet).
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emission factors require source tests that are inadequate in frequency and unrepre- sentative of the variation in Shell’s proposed operations to allow the Region to derive accurate emission factors. Id.
a. Blanket Emission Limits and Practical Enforceability
ICAS and REDOIL Petitioners correctly assert that the use of blanket emis-
sion limits alone, essentially statements that actual emissions of a pollutant will not exceed a particular quantity, is generally prohibited to restrict PTE because such limits are not enforceable as a practical matter. See United States v. La.-Pac. Corp., 682 F. Supp. 1122, 1133 (D. Colo. 1987) (“[C]ompliance with blanket re- strictions on actual emissions would be virtually impossible to verify or en- force.”), quoted in REDOIL Petition at 11; see also Office of Air Quality Planning
& Standards, U.S. EPA, New Source Review Workshop Manual at C.4 (draft Oct. 1990) [hereinafter NSR Manual] (“Blanket emissions limits alone (e.g., tons/[year], lb/[hour]) are virtually impossible to verify or enforce, and are there- fore not enforceable as a practical matter.”), quoted in ICAS Petition at 13; Mem- orandum from Terrell Hunt, Assoc. Enforcement Counsel, U.S. EPA, & John Seitz, Dir., Stationary Source Compliance Div., U.S. EPA, Guidance on Limiting Potential to Emit in New Source Permitting 7 (June 13, 1989) (A.R. B-4) [herein- after 1989 Guidance on Limiting PTE].21 However, the Petitioners’ characteriza- tion of the source-wide emission limits for NOx and CO contained in the Permit as blanket emission limits must fail. ICAS and REDOIL Petitioners do not acknowl- edge the Region’s explanation in the Response to Comments for why it chose to apply source-wide emission limits in the Permit, nor do they establish that the Region’s fundamentally technical determinations contravene Agency guidance.
The Region made clear in the Response to Comments that its decision to
employ source-wide emission limits calculated as rolling 365-day limits to restrict NOx and CO was based in large part on the substantial and unpredictable varia- tions in emissions based on the atypical nature of Shell’s operations. RTC at 26-27; Region Response at 18. Variability in Shell’s exploratory operations, multiple engines and generators located on both the Kulluk and numerous vessels in the Associated Fleet, the state of the weather and the sea, ice thickness, and the changing nature of the activities that Shell may need to conduct all influenced the Region’s conclusion that the need for operational flexibility made it impractical to establish unit-specific limits or operating parameters for some pollutants, such as NOx and CO, that might typically be applied to limit a stationary source’s PTE. RTC at 27; see Statement of Basis at 38. The Region continued that, in its judg- ment, the choice to restrict the Kulluk’s PTE for NOx and CO using source-wide emissions limits “accounts for variability in operations and emissions, yet still
21 Appendix C of the NSR Manual is based largely on the 1989 Guidance on Limiting PTE.
NSR Manual at C.1 n.1.
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provides assurance that limits on potential to emit can be enforced as a practical matter.” RTC at 28.
Although the restrictions to limit the PTE of emission units located on the
Kulluk and the Associated Fleet utilize a rolling 365-day limit, a longer time pe- riod than generally recommended in Agency guidance,22 as the Region points out, the continuous monitoring and recording of fuel usage and the application of source-test derived or specified emission factors have the practical effect of con- straining Shell’s fuel use, thus ensuring compliance with the PTE limits. Region Response at 15, 17 (citing In re Pope & Talbot, Inc., Petition No. VIII-2006-04 (Adm’r 2007) (A.R. B-24), in which rolling emission limits in addition to pre- scribed emission factors and appropriate monitoring and recordkeeping were suf- ficient to restrict PTE).23 In essence, although the Region could not incorporate more traditional operational limits into the Permit based on the atypical nature of the permitted activities, the daily calculation of NOx and CO emissions in con- junction with continuous monitoring and recording of fuel usage ensure that the NOx and CO PTE restrictions can be practically enforced.
Despite the Region’s explanation in the Response to Comments regarding
the need to consider the facts unique to this Permit, neither ICAS nor REDOIL Petitioners explain why, especially in light of the Kulluk’s atypical operations as
22 The 1989 Guidance on Limiting PTE recommends that the time limit over which production
or operational limits extend should be “as short term as possible” in order for such limitations to be enforceable as a practical matter, and generally not exceeding one month, but the Guidance also recog- nizes that in rare circumstances a limit spanning a longer time may be appropriate. 1989 Guidance on Limiting PTE at 9. The Guidance specifies that a limit spanning a longer time is appropriate if it is rolling and that it should not exceed an annual limit rolled on a monthly basis. Id. The Guidance also notes that:
[P]ermits where longer rolling limits are used to restrict production
should be issued only to sources with substantial and unpredictable an-
nual variation in production[] * * * Rolling limits could be used as well
for sources which shut down or curtail operation during part of a year on
a regular seasonal cycle, but the permitting authority should first explore
the possibility of imposing a month-by-month limit.
Id. at 9-10. In this instance, although the Guidance was written prior to Congress authorizing EPA to regulate air emissions from sources located on certain areas of the OCS, see Region Response at 17, including the Arctic, the circumstances the Guidance anticipates that would make a longer time limit appropriate apply in this instance to the Kulluk permit, where the operations are seasonal and thus variation in production would be substantial. See 1989 Guidance on Limiting PTE at 9-10.
23 Although the Board agrees with Petitioners that the Region did not cite this decision until it
submitted its response to the petitions for review, and thus accepts their reply briefs with respect to this point, see supra Part V, the Board nonetheless disagrees that this publicly available decision of the Administrator is inapposite to the current appeal. The Pope & Talbot decision underscores the Agency’s ability to exercise its discretion and its technical expertise in order to craft practically en- forceable synthetic minor limits.
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compared to other stationary sources, the Permit’s PTE limits are not practically enforceable. See Region Response at 17. Rather, Petitioners hew closely to the language in the 1989 Guidance on Limiting PTE prohibiting blanket emissions, asserting instead that because the Permit does not contain production or opera- tional limits to restrict PTE, the NOx and CO emission limits constitute blanket emission limits that contravene Agency guidance. ICAS Petition at 11-14; REDOIL Petition at 9-11. The 1989 Guidance on Limiting PTE sets forth the types of limitations that will restrict a source’s PTE and states in relevant part:
To appropriately limit potential to emit * * * permits
* * * must contain a production or operational limitation
in addition to the emission limitation in cases where the
emission limitation does not reflect the maximum emis-
sions of the source operating at full design capacity with-
out pollution control equipment. Restrictions on produc-
tion or operation that will limit potential to emit include
limitations on quantities of raw materials consumed, fuel
combusted, hours of operation, or conditions which spec-
ify that the source must install and maintain controls that
reduce emissions to a specified emission rate or to a spec-
ified efficiency level.
1989 Guidance on Limiting PTE at 5-6.24 In addition, neither ICAS nor REDOIL Petitioners address the operational limits included in the Permit and discussed in
24 The Guidance also acknowledges that the “particular circumstances of some individual
sources make it difficult to state operating parameters for control equipment limits in a manner that is easily enforceable as a practical matter” and lists two exceptions. 1989 Guidance on Limiting PTE at 7. Although the Guidance preceded EPA’s authority to regulate air emissions on parts of the OCS, see Region Response at 17, and thus could not have anticipated the circumstances of the permit at issue in these appeals, the Region nonetheless asserts that the circumstances surrounding the current permit are sufficiently analogous to the second exception for volatile organic compound (“VOC”) surface coating operations, which contemplates no add-on controls but allows for the restriction of PTE by limiting the VOC contents and quantities of coatings used. Id. at 17-19 (referring to 1989 Guidance on Limiting PTE at 8).
The VOC exception focuses on circumstances where operating and production parameters
could not be readily set due to the wide variety of coatings and products and due to the unpredictable nature of the operations. 1989 Guidance on Limiting PTE at 8. The Region asserted that the rationale informing the VOC surface coating operation exception is sufficiently similar to the present circum- stances and analogized that an effective way to restrict NOx and CO was through source-wide emis- sions limits supported by test-derived or specified emission factors, similar to the VOC content of coatings, continuous monitoring and recording of operational parameters, and tracking the quantity of VOC coating used. RTC at 30; Region Response at 18. REDOIL Petitioners and ICAS assert that the VOC exception should be construed quite narrowly and that the VOC surface coating operation excep- tion within the 1989 Guidance on Limiting PTE could not apply to the Kulluk and the Associated Fleet. See ICAS Petition at 20; REDOIL Petition at 13-14. Petitioners do not state more than a differ-
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the Response to Comments. See RTC at 29 (discussing hourly operational limits on mudline cellar drilling and overall drilling activity and the installation of SCR and OcyCat controls to limit NOx emissions).
Finally, ICAS challenges the Region’s inclusion of requirements in the Per-
mit to calculate daily emissions for NOx and CO on a weekly basis, arguing that it is a “critical flaw to enforceability of the permit because it means that Shell will only know where it stands vis-a-vie [sic] its NOx and CO permit limits once a week.” ICAS Petition at 14 (citing Permit Conditions D.1.1, D.1.2). The Board finds ICAS’s argument here unavailing in light of the Region’s thorough explana- tion in the Response to Comments. See RTC at 44; Region Response at 19, 23. The Region explained that although the calculations of emission limits will be conducted weekly, data is continuously collected and recorded and will eventually be generated in the same terms as the emission limits. See RTC at 44; Region Response at 23. Moreover, the Region points out that Shell is required to process data from numerous emission units across multiple vessels for 168 individual hours (24 hours x 7 days). RTC at 44. The permit requirements to continuously monitor and record data necessary to conduct daily emissions calculations en- sures, as ICAS raises, the ability to assess and verify compliance immediately should an inspector, the Region, or Shell require it. RTC at 44; Region Response at 23. In this instance, ICAS does not acknowledge the Region’s response or ad- dress why that response is inadequate and thus warrants review. As this Board has previously stated, “[p]etitions for review may not simply repeat objections made during the comment period; instead they must demonstrate why the permitting authority’s response to those objections warrants review.” Peabody, 12 E.A.D. at 46 n.58; accord In re Knauf Fiber Glass GmbH, (“Knauf II”), 9 E.A.D. 1, 5 (EAB 2000); see also standard of review discussion supra Part III.
In addition, as the Board noted above in Part VI.A.1.b, the determination of
a source’s PTE is inherently an exercise that requires technical expertise. Neither REDOIL Petitioners nor ICAS have met the particularly heavy burden of demon- strating that review of the Region’s decisions to employ source-wide emission limits to restrict the Kulluk’s PTE is warranted. See, e.g., Peabody, 12 E.A.D. at 33; NE Hub, 7 E.A.D. at 567 (“When issues raised on appeal challenge a Re- gion’s technical judgments, clear error or a reviewable exercise of discretion is not
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ence of opinion or alternative view on a technical issue. See NE Hub, 7 E.A.D. at 567. Without more, petitioners cannot sustain the burden of demonstrating that review of the Region’s exercise of its tech- nical judgment is warranted. See Peabody, 12 E.A.D. at 33; In re Teck Cominco Alaska Inc., 11 E.A.D. 457, 473 (EAB 2004).
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established simply because petitioners document a difference in opinion or an al- ternative theory regarding a technical matter.”).
b. Emission Factors
An emission factor is a representative value used to relate the quantity of a
pollutant released to the atmosphere with an activity associated with the release of that pollutant. U.S. EPA, AP-42, Compilation of Air Pollutant Emission Factors, Volume 1: Stationary Point and Area Sources 1 (Jan. 1995) (5th ed.) (“AP-42 Guidance”). Emission factors essentially represent an average of a range of emis- sion rates of the subject sources. Id. at 2. As stated above in Part VI.A.2, in this instance compliance with the PTE restrictions for NOx and CO are determined by calculating daily emissions of each pollutant, which requires multiplying the ap- propriate emission factor by the recorded daily operation rate and dividing by 2000 lb/ton. Permit Conditions D.4.1, D.4.2.
REDOIL Petitioners and ICAS challenge several aspects of the Region’s
use of emission factors to assist in calculating compliance with the restricted PTE for both NOx and CO. Both petitioners challenge the Region’s decision to forgo source-specific emission testing to establish emission factors for all emission units on the Kulluk and the Associated Fleet and further assert that this will cause the Region and Shell to underestimate the quantities of NOx and CO emitted by the OCS source. ICAS Petition at 15-19; REDOIL Petition at 11-13. REDOIL Peti- tioners and ICAS assert that the use of AP-42 emission factors and emission fac- tors derived from Discoverer test results for those emission units that will not undergo source-specific testing constitutes clear error because these more generic emission factors will likely lead to an underestimation of emissions from the units to which they are applied. ICAS Petition at 16-18; REDOIL Petition at 11-12 (referring to AP-42 emission factors as “notoriously inaccurate default factors”). Finally, ICAS challenges the frequency and number of stack tests used to develop source-specific emission factors for emission units and further asserts that by Shell’s own admission there is a 15% variability in stack test data that results in a less conservative emission factor than the Region claims. ICAS Petition at 16-17.
The Board notes at the outset that the development of emission factors for
use in calculating daily emissions to determine compliance with PTE restrictions requires the sort of quintessential technical expertise the permit issuer possesses, here the Region, to which the Board will defer if “the record demonstrates that the Region duly considered the issues raised in the comments and if the approach ultimately selected by the Region is rational in light all of the information in the record.” NE Hub, 7 E.A.D. at 567-68, quoted in Peabody, 12 E.A.D. at 34; see also Avenal Energy Ctr., 15 E.A.D. at 387. As explained more fully below, for each challenge regarding the derivation and use of emission factors set forth in the Permit, REDOIL Petitioners and ICAS have failed to sustain the particularly heavy burden petitioners must overcome to demonstrate that review of a funda-
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mentally technical decision is warranted. See, e.g., Peabody, 12 E.A.D. at 33; NE Hub, 7 E.A.D. at 567-68.
The Region fully explained in the Response to Comments its rationale for
supplementing source-specific emission factors derived for most of the emission units or groups of emission units located on the Kulluk or the Associated Fleet with either AP-42 emission factors25 or emission factors derived from Discoverer source test data for a minority of units. RTC at 32-33; see also Region Response at 20-21. In support of its decision to utilize a mix of source-specific testing for emission factors in addition to using AP-42 and Discoverer test data emission factors, the Region stated that it “believes the permit strikes an appropriate bal- ance between the need for accurate emission factors to reliably calculate emis-
25 ICAS’s attempt to analogize the situation the Board confronted in Peabody to the current
permit appeal falls short. Although Peabody discusses the use of AP-42 emission factors in a PTE calculation where the source was seeking synthetic minor status, ICAS fails to acknowledge critical factual elements that distinguish Peabody from the current appeal.
In Peabody, the permittee was a large coal-processing plant built prior to the effective date of
the PSD program that requested a PTE limit for particulate matter with a diameter of 10 microns or less (“PM10”) in the permittee’s Title V permit so that the facility could remain a synthetic minor source for PM10 emissions should it conduct any major modifications in the future. See Peabody, 12 E.A.D. at 24-34. Of critical importance, the facility’s emissions were primarily fugitive, and thus, emission testing to directly measure PM10 emissions was not feasible. Id. at 34. The permittee consequently submitted a request for a PTE limit based on a quantitative estimate of the facility’s capacity to emit PM10, which in turn relied on estimates of uncontrolled emissions from each unit based on the applica- tion of AP-42 emission factors that were then used to estimate net emissions by applying assumed emission control efficiencies for the emission control equipment in use. Id. at 34-35 & n.31. Peabody’s proposed compliance regimen did not include direct measurement of PM10 emissions. As the Board stated, “[b]ecause Peabody’s approach would rely entirely on the application of emission factors and assumed control efficiencies, for purposes of both estimating maximum emissions capacity and moni- toring ongoing compliance, the accuracy and appropriateness of the emission factors and the control efficiency assumptions were the focal point of Region IX’s analysis of Peabody’s proposal.” Id. at 35-36.
Contrary to the facility in Peabody, in this instance the use of AP-42 factors to calculate com-
pliance with restricted PTE for NOx and CO was essentially a last resort method for calculating com- pliance, whereas the emission units that accounted for at least 90% of the NOx and CO emissions were subject to source-specific emission testing. See id. at 32-33. The Region made clear that in the rela- tively small number of instances where an AP-42 emission factor was employed to calculate compli- ance with PTE, the Region chose conservatively higher emission factors. In Peabody, the Region made a technical determination and “concluded that Peabody had not sufficiently demonstrated that it met the central criteria for establishing [PTE] – technical accuracy and a reliable method of determin- ing compliance.” Id. at 39. In this instance, the Region made a technical determination that Shell has sufficiently demonstrated that the Kulluk could demonstrate compliance with the NOx and CO PTE limits included in the permit in a manner that is technically accurate, and that the compliance of the emission units can be verified based on source-specific testing. The Region’s exercise of its technical expertise to conclude that in limited circumstances AP-42 emission factors were appropriate to demon- strate compliance with the restricted PTE is rational in light of all of the information in the record. Thus, ICAS’s contention that Peabody governs the appeal currently before the Board is unpersuasive.
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sions for comparison to permit limits and the complexity of testing numerous emission units in a short period of time.” RTC at 33. The Region also noted that, in response to comments received, it decided to require source-specific emission testing for incinerators and that, after that change, the permit will require source testing of emission units that constitute 91% of NOx and 97% of CO emissions. Id. at 32. Of the remaining units that were not required to undergo source testing to develop an emission factor, the Region set forth in detail why it had chosen emission factors derived from Discoverer source test data or the AP-42 emission factors, in many instances raising the value of an emission factor to provide a more conservative estimate of emissions.26 Id. at 32-33; see also Region Response at 20; Statement of Basis at 38 (noting that testing for source-specific emission factors (Permit Condition E.2) uses a protocol that results in conservatively high unit-specific emission factors that in turn help to ensure compliance with PTE).
26 The Region explained in the Statement of Basis that an important element of Permit Condi-
tion E.2, which catalogues the procedures for conducting tests to determine equipment-specific emis- sion factors, “is the selection of worst[-]case emission factors for each emission unit or group of emis- sion units tested.” Statement of Basis at 43; see also Permit at 52-56. The record demonstrates that the Region thoughtfully and judiciously employed emission factors derived from Discoverer test data and AP-42 emission factors, and consistently chose higher, more conservative emission factors when there was any question or discrepancy. For example, for those NOx emission units for which the Permit does not require source testing and that rely on emission factors based on Discoverer test data, the Region adjusted the emission factor to reflect the conservative 90th percentile (or higher) values from the test data. RTC at 32. The Region further explained that for heaters and boilers – the only remaining group of NOx emission units that rely on AP-42 for emission factors – the Region expects the AP-42 emis- sion factor to be a conservative representation of actual emissions. Id. (noting that while AP-42 pre- dicted an NOx emission factor for heaters and boilers of 0.02 lb/gal, Shell testing of Discoverer boilers shows a range of values between 0.011 lb/gal and 0.015 lb/gal); see also RTC at 46 (noting that the boiler and heater NOx emission factor used in the Kulluk permit is “lower than the Discoverer BACT limit for similar equipment, but is higher than available test data for a similar source”). ICAS chal- lenged the Region’s use of an NOx emission factor in the Permit that is lower than the one in the Discoverer permits, see ICAS Petition at 18-19, but ICAS failed in its petition to even acknowledge the Region’s response to its comment regarding the NOx emission factor for heaters and boilers, let alone “substantively confront the permit issuer’s subsequent explanation.” Peabody, 12 E.A.D. at 33 (citing In re Zion Energy, LLC, 9 E.A.D. 701, 705 (EAB 2011)).
With respect to emission units that will not undergo source testing to verify CO emission fac-
tors, the Region similarly explained that it believed emission factors are reasonable for use in the permit given that AP-42 emission factors will represent only 3% of the total CO emissions. RTC at 32. In addition, the Region notes that the CO emissions from tests conducted for two boilers on the Dis- coverer were nearly identical to the AP-42 emission factor. Id. at 33 (explaining that the Region chose the highest, most conservative emission factor of the three). Finally, the Region notes that one of the potential oil spill and response boats has an actual CO emission factor for its propulsion engine that is based on the manufacturer’s data and is one tenth of what the AP-42 factor predicts. Id.; see also Permit Table D.2.2 (demonstrating that the Region chose to include the much higher AP-42 emission factor for the OSRV propulsion engine).
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While REDOIL Petitioners27 and ICAS may disagree with the Region’s approach, Petitioners do not demonstrate that the Region’s choices in deriving emission fac- tors for emission units will result in an underestimation of pollutants emitted by the Kulluk and the Associated Fleet. The Region has demonstrated that it balanced its primary task of accurately calculating NOx and CO emission factors to ensure that the Kulluk and the Associated Fleet will not exceed the restricted PTE with the practical need to calculate emission factors for numerous and varied emission units aboard both the Kulluk and the Associated Fleet. The Board has frequently stated that it will not grant review where, as here, the record demonstrates a bona fide difference of opinion or alternative theory regarding a technical matter but the approach the Region ultimately selected is rational in light of all the informa- tion in the record. Peabody, 12 E.A.D. at 34 (quoting NE Hub, 7 E.A.D. at 567).
Finally, ICAS asserts that the Discoverer source test data is not sufficient to
accurately generate worst-case scenario emission factors for Kulluk emission units because similar sources tested on the Discoverer were subject to BACT, and fur- ther, that in using stack test results from the Discoverer to develop emission fac- tors for the Kulluk permit, the Region never accounted for “15% variability in Shell’s stack tests,” resulting in inadequate emission factors. ICAS Petition at 17-19. The Region points out, however, that the Discoverer stack tests on which the Region relied to calculate the 90th percentile value and assess the appro- priateness of AP-42 factors were not subject to post-combustion controls limiting NOx or CO and thus provided an appropriate comparison for purposes of deriving emission factors for the Kulluk. Region Response at 21 (citing Discoverer stack test results and communications discussing them in the administrative record, spe- cifically A.R. B-55, B-63, C-406, and C-489). With respect to the 15% variability in stack test results28 that ICAS alleges, the Region points to the technical litera-
27 REDOIL Petitioners contend that the Region’s recognition that Shell’s approach involves
“inherent uncertainty” regarding what equipment will be aboard the Kulluk and the Associated Fleet, which in turn requires “thorough source testing,” coupled with the Region’s refusal to require source testing for all equipment, is “internally inconsistent and thus arbitrary and unlawful.” REDOIL Petition at 12. However, the Region responded that it used its technical expertise to determine that in this instance, a mix of both source-specific testing to derive emission factors, in addition to using AP-42 factors and emission factors derived from Discoverer test data where appropriate, was reasonable and not inconsistent. Region Response at 20-21. The Board agrees with the Region that the decision to use source-specific testing to derive emission factors, in conjunction with the emission factors developed from Discoverer data and from AP-42, is inherently technical. In order to effectively exercise its ex- pertise, the Region should not, as REDOIL Petitioners suggest, be cabined by a rigid interpretation of how emission factors should be determined. REDOIL Petitioners have failed to meet the particularly high threshold for demonstrating that Board review of the Region’s fundamentally technical decision is warranted. Peabody, 12 E.A.D. at 33-34.
28 ICAS also asserts that stack tests are “conducted once a year for one or two years depending
on the source,” at three different loads, and even when the worst-case emissions are used, the stack tests fail to account for Shell’s varying emissions. ICAS Petition at 16. The Region explained in re-
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562 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
ture Shell referenced in Shell’s comments, which addresses “uncertainty in deter- mining front-half PM [particulate matter] emission rates” and does not directly address procedures for deriving NOX and CO emission factors. Id. at 22-23; see also Permit Conditions E.1.2, E.1.7, E.1.14 (requiring Shell to submit a testing plan and follow EPA-approved test methods, and establishing Region’s authority to require additional stack tests if necessary). As the Region correctly points out, ICAS has not demonstrated that the worst-case stack test results, which embody the Region’s fundamentally technical determinations, will be biased low and underreport emissions. Region Response at 22-23; see, e.g., Teck Cominco, 11 E.A.D. at 473 (discussing heavy burden assigned to petitioners seeking review of issues that are essentially technical in nature).
3. ICAS Has Failed to Demonstrate That the Region Clearly Erred
in Restricting the Kulluk and the Associated Fleet’s Potential to
Emit GHGs
ICAS also challenges the Permit’s GHG emission limit, which restricts
Shell’s annual GHG emissions to 80,000 tpy of carbon dioxide equivalent (“CO2e”).29 See ICAS Petition at 21-26; see also Permit Condition D.4.4; RTC at 28. EPA promulgated regulations, commonly referred to as the “Tailoring Rule,” that set forth applicability criteria to determine which GHG emission sources become subject to the PSD and Title V programs under the Act.30 Preven- tion of Significant Deterioration and Title V Greenhouse Gas Tailoring Rule, 75 Fed. Reg. 31,514, 31,516 (June 3, 2010). In this instance, despite the fact that
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sponse that Permit Condition E.2.1 requires each source-tested unit to be tested prior to each of the first two drilling seasons and subsequently every two or five years depending on any variability ob- served in the results of the two initial tests. Region Response at 22; see also Statement of Basis at 44 (frequency of source-specific emission factor testing after first two years based on variability of re- sults). Further, each test requires three 1-hour runs at each of the three tested operating loads, which results in nine results total for each aggregate source test. Region Response at 22. Without more than its bare assertion that the current source tests do not adequately address Shell’s varying emissions when the data is used to derive emission factors, ICAS cannot demonstrate that the permit conditions that dictate the frequency and parameters of source tests warrant Board review.
29 GHGs are defined as “the aggregate group of six greenhouse gases: carbon dioxide, nitrous
oxide, methane, hydroflourocarbons, perflourocarbons, and sulfur hexaflouride.” 40 C.F.R.
§ 52.21(b)(49)(i). CO2e represents the amount of GHGs emitted and is computed by “[m]ultiplying the mass amount of emissions (tpy), for each of the six greenhouse gases in the pollutant GHGs, by the gas’s associated global warming potential published at Table A-1 subpart A of [40 C.F.R.] part 98 of this chapter – Global Warming Potentials.” Id. § 52.21(b)(49)(ii)(a).
30 The regulations provide that any source that is considered a new major source for a regu-
lated NSR pollutant other than GHGs will also be subject to regulation for GHGs if it emits or has the potential to emit 75,000 tpy or more of CO2e. 40 C.F.R. § 52.21(b)(49)(iv). New stationary sources that emit or have the potential to emit more than 100,000 tpy or more of CO2e are also subject to regulation for GHGs. Id. § 52.21(b)(49)(v).
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the OCS source’s pre-permitted potential to emit exceeded 100,000 tpy of CO2e, see Statement of Basis at 24, the Permit restricts the potential to emit GHGs to 80,000 tpy of CO2e and thus prevents Shell from being subject to regulation for GHGs under the PSD program. See RTC at 24.
As noted previously, the vast majority of emissions, including GHG emis-
sions, from both the Kulluk and the Associated Fleet result from internal combus- tion sources such as engines and boilers, along with incinerators. Statement of Basis at 12, 14, 39; RTC at 35. The Permit contains operational restrictions on the amount of time a source can operate, the amount of fuel and waste combusted, and the type of fuel combusted to ensure compliance with the Permit’s GHG emission limit.31 See Statement of Basis at 37-39; RTC at 33-36; id. at 34-35 (not- ing that in response to comments the Region adjusted the methane emission factor upward by a factor of four to represent a reasonable upper-bound estimate of the number of wells that could be drilled in a single season, which in turn required a small reduction to the total amount of fuel that may be combusted in engines and boilers during any rolling 12-month period). In addition to the combustion sources and the incinerators, a relatively small amount of GHG emissions in the form of methane results from the drilling mud system (“DMS”).32 See RTC at 35. GHG emissions from the DMS, calculated at 85 tpy of CO2e, represent only 0.11% of the total GHG emissions allowed under the permit, 80,000 tpy of CO2e. Id. The Region calculated an unrestricted PTE for methane emissions of 1,596 lbs/month,
31 The Permit imposes annual limits of 120 days of operation as an OCS source during a drill-
ing season, which spans from July 1 through November 30, and 1,632 hours of total drilling activity in a drilling season, of which only 480 hours may be used to conduct mudline cellar drilling activity, which is expected to generate the most air pollution. See Permit Conditions D.3.1-D.3.5. The Permit also limits the total aggregate combustion of fuel over a 12-month rolling period, the type of fuel combusted, and the total aggregate daily waste-combusting capacity of incinerators. See Permit Condi- tions D.4.6-.7, .9; see also RTC at 34-35. In addition, the Permit includes various monitoring and recordkeeping requirements to document when emissions should be counted toward emission limits, testing requirements for the derivation of source-specific emission factors, tracking and documentation requirements for the fuel and waste combusted, and maintenance requirements to ensure that emission units are properly operated and maintained. See Permit Conditions D.1-.4, D.8, F.2.1-.7; see also RTC at 36-37, 43.
32 The Region explained methane emissions from the DMS as follows:
When wells are drilled through porous, hydrocarbon[-]bearing rock,
drilling fluids (mud) circulated through the drill bit can carry gaseous
hydrocarbons from the well back to [the] Kulluk. These gases are typi-
cally released as fugitive emissions when the mud is processed for reuse
on the Kulluk or stored and shipped away; however, some of the emis-
sions pass through a vent.
Statement of Basis at 38.
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the equivalent of 17 tons per month (“tpm”) of CO2e.33 Id. The Permit accounts in Condition 4.4.2 for methane emissions encompassing the source’s full unrestricted PTE of 17 tpm of CO2e, which are added to GHG emissions from combustion sources when calculating total GHG emissions. See Statement of Basis at 39; Shell Discoverer 2012, 15 E.A.D. at 516.
ICAS raises several challenges to the Permit’s GHG emission limit. Similar
to its challenges of the Permit’s synthetic minor limits for NOx, CO, and SO2, ICAS contends that the Permit contains a blanket emission limit for GHGs that is practically unenforceable and further asserts that the requirement that GHG emis- sions only be calculated monthly to determine compliance with the established rolling 12-month limit is inadequate to verify compliance “in a given moment.” ICAS Petition at 21-22 (citing NSR Manual at C.3, C.5, H.5); see Permit Condi- tions D.1.3-.4. In addition, ICAS asserts that the Region clearly erred by ac- cepting an owner-requested limit for methane attributable to mud off-gassing from the DMS that is not only unenforceable, but also less than the “maximum expected capacity” or “upper-bound projection” ConocoPhillips submitted in an- other Arctic OCS permit proceeding. Id. at 22-26.
Based on the foregoing information, ICAS’s general assertion that the GHG
emission limit is practically unenforceable must fail. The Region has demon- strated in both the Permit and the documentation in the record supporting the Per- mit that it crafted a synthetic minor limit that would not only prevent Shell from being subject to regulation under the PSD program for GHG emissions, but also
33 In calculating the unrestricted PTE for DMS methane emissions, the Region included sev-
eral conservative assumptions to ensure a wide margin of safety for total methane emissions over Shell’s five-month period of operation. See RTC at 34; Options for Limiting PTE at 8 (noting that for sources with inherent physical limitations that restrict the potential emissions of an emissions unit, if such limitations can be documented and confirmed, the permitting authority may factor them into estimates of a stationary source’s PTE). For example, the Region assumed that the total unrestricted PTE for DMS methane emissions for the entire five months of drilling operations would be emitted during each of the five months. RTC at 35.
In addition, despite much of the methane emissions being fugitive emissions that are not
counted towards PSD applicability for exploratory drill rigs, see 40 C.F.R. § 52.21(b)(1)(iii), Shell agreed to consider all of the methane emissions from the DMS as point source emissions that would count towards Shell’s potential to emit GHGs. See RTC at 35; see also Statement of Basis at 38-39. In its petition, ICAS disputes the Region’s claim that counting such fugitive emissions towards PTE rep- resents a conservative approach that lends a “measure of safety” and asserts that the part 71 regulations governing Title V permits require such fugitive emissions to be included. ICAS Petition at 24 (citing 40 C.F.R. § 71.3(d), which states that fugitive emissions from a part 71 source “shall be included in the permit application and the part 71 permit in the same manner as stack emissions”). However, as the Region correctly points out in its response, the definitions of major source in both 40 C.F.R.
§ 52.21(b)(1)(iii) and 40 C.F.R. § 71.2 make clear that fugitive emissions are not considered when determining whether a source is a major source. Region’s Response at 26 n.21 (citing the Tailoring Rule and noting that it retained this approach of determining whether a source becomes subject to regulation for GHGs).
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would be practically enforceable as a result of the numerous operational restric- tions in combination with monitoring, recordkeeping, and reporting requirements contained in the Permit. While ICAS acknowledges the operational limits con- tained in the Permit, ICAS simultaneously disputes their efficacy without explain- ing why such operational limits will not have their intended effect of restricting Shell’s potential to emit GHGs.34 See ICAS Petition at 21-22. Without stating more than mere disagreement, ICAS cannot meet the especially high threshold of demonstrating that the Region’s inherently technical decisions regarding the GHG emission limit warrant Board review. See, e.g., NE Hub Partners, 7 E.A.D. at 567; Shell Discoverer 2012, 15 E.A.D. at 501.
ICAS’s more specific contention that the Region clearly erred by accepting
an owner requested restriction for methane from mud off-gassing that is practi- cally unenforceable is unavailing. See ICAS Petition at 22-26. ICAS raised this same argument in previous appeals of two OCS PSD permits the Region issued to Shell for operations in the Chukchi Sea of the Arctic OCS. See Shell Discoverer 2012, 15 E.A.D. at 514-19; see also supra note 20. In brief, the monthly calcula- tion of methane to be released in mud off-gassing in both Shell Discoverer 2012 and the current appeal are not only the same amount, 17 tpm, they also both re- flect the unrestricted PTE for methane emissions from DMS operations. See RTC at 34-35; Shell Discoverer 2012, 15 E.A.D. at 517-18. The Board rejects ICAS’s assertion in this instance, relying on the same reasons it gave in Shell Discoverer 2012:
[T]he Permit[] in this case do[es] not include owner re-
quested limits on PTE for methane emissions. Rather,
* * * methane emissions were assumed to occur at the
source[’s] full PTE for the five-month drilling season
34 Similarly, ICAS’s contention that the Region clearly erred by not requiring more frequent
calculations of GHG emissions than the monthly calculations the Permit requires, see Conditions D.1.3-.4, falls short. The Region explained that its decision to calculate emissions on a monthly basis stemmed from “good confidence in the overall [GHG emission] compliance technique and therefore ‘yearly’ emissions are required to be summed only monthly.” Statement of Basis at 38. Although GHG emission calculations will be calculated once a month based on the Region’s stated confidence in its compliance method, the data required to make such calculations is collected continuously through fuel usage monitoring. RTC at 43-44 (“Shell is generally required to continuously measure and record, on an hourly basis, the fuel consumed by each emission unit or group of emission units.”); see also Re- gion Response at 24 (citing 1989 Guidance on Limiting PTE and noting that “in light of annual varia- tions in operations and the fact that the source operates during only part of the year” the Region deter- mined that a 12-month rolling limit for CO2e was appropriate as stated). Again, ICAS has failed to meet its burden of demonstrating that review is warranted, where, as here, it has not addressed the Region’s stated rationale for requiring only monthly calculation of GHG emissions and has not demon- strated that monthly calculation of GHG emission would inhibit verification of compliance with the GHG emission limit. See supra Part III.
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(0.798 tons per month),35 and the Permit[] count[s] these
emissions towards the total GHG limitation * * * . The
Region determined that because these unrestricted emis-
sions of methane (when combined with GHG emissions
from combustion sources) would not result in an ex-
ceedance of the Permit[’s] total GHG emissions limit, ad-
ditional permitting restriction limits were not required.
Under these circumstances, ICAS’s reliance on the re-
quirement that permits include conditions ensuring the en-
forceability of limitations on a source’s PTE is misplaced,
as the Permits do not contain owner requested limits on
methane emissions or otherwise limit the source[’s] PTE
from DMS operations.
Shell Discoverer 2012, 15 E.A.D. at 517-18 (citations omitted).
In addition, ICAS has not demonstrated that the Region’s calculation of
methane emissions from the DMS underestimated the “upper-limit” projection that is in turn used to identify the “maximum capacity” of a source based on an “inher- ent physical limitation.” RTC at 34 (citing Options for Limiting PTE at 8 and Memorandum from John Seitz, Dir., Office of Air Quality Planning & Standards, to Reg’l Air Dirs., U.S. EPA, Calculating Potential to Emit (PTE) and Other Gui- dance for Grain Handling Facilities at 4-5 (Nov. 14, 1995) (A.R. B-10) [hereinaf- ter Grain Handling Guidance]). ICAS’s assertion is premised on ConocoPhillips’ higher estimate of DMS methane emissions submitted to the Region in another permit proceeding concerning exploratory drilling in the Arctic OCS. ICAS Peti- tion at 23-26. However, ICAS simply states that the discrepancy between Shell’s and ConocoPhillips’ calculations of DMS methane emissions means that the Re- gion clearly erred in accepting Shell’s methane calculations, but it does not ac- knowledge or evaluate the record information Shell submitted that explains in depth the causes for the divergent methane calculations.36 Upon considering this
35 This is the same unrestricted PTE for methane emissions as in the Kulluk permit (1596 lb /
2000 lb = 0.798 tons).
36 In Shell Discoverer 2012, ICAS asserted that it was unable to evaluate the basis for Shell’s
estimates of DMS methane emissions that the Region had relied on to calculate PTE because Shell did not release its estimates until after the close of the comment period. 15 E.A.D. at 517 n.63. In that instance, the Board concluded that the Region was authorized to supplement the record with previ- ously unavailable information confirming that Shell’s estimate of methane PTE was a reasonable up- per-bound estimation, and “[t]hus, ICAS had the opportunity to evaluate the basis for Shell’s PTE estimates and the Region’s assessment of those estimates in preparing its appeal to this Board.” Id. (citing In re Cape Wind Assoc., LLC, 15 E.A.D. 327, 332-33, 335 (EAB 2011), and 40 C.F.R.
§§ 124.17(a)-(b), .18(b)).
Continued
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information, the Region exercised its technical expertise in concluding that Shell’s estimates of methane emissions from the DMS were permissible, especially given the conservative assumptions the Region incorporated when calculating PTE. ICAS does not address either the record information that supports the Region’s decision to accept Shell’s methane estimate or the Region’s stated rationale for concluding that methane monitoring is not required. See RTC at 35-36 (explaining that, based on the inherent limitations that exist and the relatively small contribu- tion of the DMS to overall GHG emissions, the Region does not believe monitor- ing of DMS emissions or operations is necessary in addition to the monitoring already required in the permit). As this Board has often stated, a petitioner cannot demonstrate that review is warranted if the petitioner fails to substantively con- front a permit issuer’s response. Peabody, 12 E.A.D. at 33 (noting that to obtain review a petitioner must “explain why, in light of the permit issuer’s rationale, the permit is clearly erroneous or otherwise deserving of review”); see also In re BP Cherry Point, 12 E.A.D. 209, 217 (EAB 2005). Moreover, as stated above, the Region’s decision regarding the GHG emission limit is inherently technical in na- ture, and ICAS has fallen short of the particularly high threshold it must meet to demonstrate that review of the Region’s technical determination is warranted. See Peabody, 12 E.A.D. at 33-34; see also NE Hub, 7 E.A.D. at 567-68.
4. The Region Did Not Clearly Err in Restricting OCS Source’s
Potential to Emit SO2
The Permit restricts SO2 emissions from the Kulluk and the Associated Fleet
to no more than 10 tpy, well below the 250 tpy PSD threshold level. See Permit Condition D.4.3. Compliance with this limit is determined on a rolling 12-month basis and is achieved by requiring that Shell not combust any liquid fuel with sulfur content greater than 0.01 percent by weight in any emission unit on the Kulluk or the Associated Fleet and that all fuel purchased for use in emission units on the Kulluk and Associated Fleet have a maximum sulfur content of 0.0015 percent by weight. Permit Conditions D.4.5, D.4.9. Shell is required to keep diesel
(continued)
The material in question is not only in the record submitted with the Discoverer appeals, it also
appears in the record for the instant appeal. See E-mail from Susan Childs, Shell, to Doug Hardesty, EPA Region 10 (Sept. 16, 2011 14:31 pm PDT) (A.R. CCC-438 in Shell Discoverer 2012 and A.R. C-575 in the current appeal). Thus in the current appeal there is no question that the information from Shell clarifying and explaining its estimate of DMS methane emissions, including the highly conservative assumptions Shell included in its estimate, was at ICAS’s disposal. In addition, Shell submitted further clarification of its DMS methane estimates as compared to ConocoPhillips’ in order to “explain how different assumptions led to different results, and why Shell believes that ConocoPhil- lips’ estimate is unrealistically high.” E-mail from Susan Childs, Shell, to EPA Region 10 (Sept. 20, 2011 17:57 pm PDT) (A.R. C-577). ICAS’s petition does not address either of these record submis- sions or the Region’s reliance on this information to determine that the Region’s calculation of meth- ane emissions from the DMS represents “a reasonable upper-bound projection for Shell’s operations
[that] is not expected to be exceeded under any reasonably anticipated operating scenario.” RTC at 35.
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fuel purchase records documenting sulfur content for each batch of fuel pur- chased. Permit Condition D.4.9.2. In addition, the total amount of fuel combusted in engines and boilers must not exceed 7,004,428 gallons during any rolling 12-month period. Permit Condition D.4.6; see also Permit Condition F.2.4 (re- quiring Shell to (1) obtain representative fuel samples and determine fuel sulfur content in parts per million from fuel storage tanks on the Kulluk and the Associ- ated Fleet prior to their mobilization, (2) determine the sulfur content of each delivery of fuel to the Kulluk and the Associated Fleet once the vessels are mobil- ized, and (3) maintain records of all sampling and analysis).
ICAS asserts that the Region justifies its blanket SO2 emissions limits by
including “purported ‘operational limits’” that restrict fuel content and usage and concludes that compliance with the restricted PTE for SO2 is practically unen- forceable because these operational limits are not unit-specific and because the overall limit is based on a 12-month rolling limit. ICAS Petition at 26-27. ICAS offers no explanation as to why the operational limits and averaging time the Re- gion chose to include in the Permit, both of which are clearly considered legiti- mate in Agency guidance, nonetheless constitute clear error. See Region Response at 28; Options on Limiting PTE attach. 1 at 5 (“[L]imitations on sulfur dioxide emissions could be based on specified sulfur content of fuel and the source’s obli- gation to limit usage to certain maximum amounts.”); 1989 Guidance on Limiting PTE at 9-10 (noting that in certain situations a rolling limit of up to a year may be appropriate for sources with “substantial and unpredictable annual variation in production,” including “source which shut down or curtail operation during part of the year on a regular seasonal cycle”).
ICAS also challenges the monitoring provisions for small and/or infre-
quently used emission units that are not required to have fuel flow monitors. ICAS Petition at 27. As the Region correctly points out, however, ICAS makes no attempt to explain why the specified fuel measurement alternatives, together with the requirement to measure and record fuel usage before and after operation, do not allow for a reliable and accurate assessment of fuel usage. Region Response at 28 (citing Permit Condition F.2.2.2). Here again, ICAS offers nothing more than a bald assertion of clear error without any analysis of why the Region erred. Where, as here, the Region’s decision was technical in nature, ICAS has failed to meet the particularly high threshold for establishing that review of the Region’s technical determination is warranted.
5. Shell’s Minor Source Permit Is Not a “Sham” Permit
ICAS asserts that in order to ensure the Kulluk’s status as a minor source,
Shell has agreed to operational limitations in its OCS/Title V permit that are not represented in other authorizations and permit applications for Shell’s exploratory activities in the Beaufort Sea. ICAS Petition at 28. ICAS alleges that Shell’s inci- dental hazard assessment, required under the Marine Mammal Protection Act,
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16 U.S.C. § 1371(a)(5)(A), (D), authorizes 78 days of drilling whereas the OCS/Title V permit only authorizes 68 days of drilling. Id. Based on this single discrepancy, ICAS categorically concludes that “Shell is submitting permit appli- cations and seeking authorization from other agencies with different plans than are provided for in its air permit.” ICAS Petition at 28-29. ICAS also asserts that the Region did not adequately respond to its concern that Shell’s application for a minor source permit is a sham.37 Id.
At the outset, the Board notes that ICAS’s assertion that Shell has secured a
sham minor source permit with the intention to avoid preconstruction review as a major source under the PSD program is wholly unsupported in the record.38 As the Region noted in the Response to Comments, there is nothing to indicate that Shell intends to later apply to the Region to remove the synthetic limits contained in the Permit. RTC at 22. The Region continued that, regardless of what the inci- dental hazard assessment says regarding the number of days Shell may drill, Shell nonetheless “must comply with all requirements of the Kulluk Permit and failure to do so is a violation of the CAA.” Id. (citing Permit Condition A.3). Finally, the Region made clear that whether an original request for a minor source permit is a “sham” may be evaluated when the Region receives a request to remove the syn- thetic limits. Id.
ICAS rejects the Region’s statement that there is nothing to suggest that
Shell intends to obtain a minor source permit now and then apply for a major source permit down the road, and baldly asserts that “this is not the proper test.” ICAS Petition at 28. ICAS ignores the element of intent to obtain a minor source
37 The NSR Manual defines a sham permit as follows:
A sham permit is a federally enforceable permit with operating restric-
tions limiting a source’s potential to emit such that potential emissions
do not exceed the major or de minimis levels for the purpose of allowing
construction to commence prior to applying for a major source permit.
Permits with conditions that do not reflect a source’s planned mode of
operation may be considered void and cannot shield the source from the
requirement to undergo major source preconstruction review. In other
words, if a source accepts operational limits to obtain a minor source
construction permit but intends to operate the source in excess of those
limitations once the unit is built, the permit is considered a sham.
NSR Manual at C.6.
38 ICAS asserts that its concern with the potential for Shell to obtain a minor source sham
permit arose because “Region 10 has provided no assurance that reporting mechanisms in the permit will provide sufficient time for Shell to halt drilling with enough of an emissions buffer remaining to secure a partially drilled well for the entire winter season * * * .” ICAS Petition at 29. ICAS also acknowledges that any exceedance of an emission limit would allow the Agency to exercise its en- forcement powers. Id. Without more, ICAS cannot demonstrate that the Region clearly erred in deter- mining that Shell’s minor source permit is not a sham.
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sham permit that both the Region in the Response to Comments and the 1989 Guidance on Limiting PTE discuss and instead quotes the NSR Manual language for the proposition that the “proper test” is a permit that does not reflect a source’s “planned mode of operation.” ICAS Petition at 28 (citing NSR Manual at C.6) (emphasis in original); see also 1989 Guidance on Limiting PTE at 12. However, the 1989 Guidance on Limiting PTE contains guidelines for determining, based on an evaluation of specific facts and evidence in each individual case, when mi- nor source construction permits are shams and includes two of four criteria that discuss the intent of the source to circumvent the PSD preconstruction review process. 1989 Guidance on Limiting PTE at 14-15.39
ICAS has not identified any information in the record that supports its as-
sertion that Shell is seeking to avoid preconstruction review. Moreover, minor source sham permits are generally discovered when a source seeks another air emissions permit that requests the permit issuer to relax the synthetic limits in the minor permit, see 1989 Guidance on Limiting PTE at 12-14, rather than when the source seeks another authorization under a different statute such as the Marine Mammals Protection Act. Finally, ICAS has not demonstrated any deficiency in the Region’s response to its comment regarding sham permits. See, e.g., Russell City II, 15 E.A.D. at 24 (noting that the part 124 regulations require a response to comments document to “demonstrate that all significant comments were consid- ered but does not require a permit issuer to respond to each comment in an indi- vidualized manner or require the permit issuer’s response to be of the same length or level of detail as comment”) (citation omitted).
For all of the reasons stated above, the Board denies review of this issue.
39 Specifically, the guidelines for determining when minor source construction permits are
shams state in relevant part:
1. Filing a PSD or nonattainment NSR permit application
If a major source or major modification permit application is filed simul-
taneously with or at the same time as the minor source construction per-
mit, this is strong evidence of an intent to circumvent the requirements
of preconstruction review.
* * *
4. Statement of authorized representatives of the source regarding plans
for operation
Statements by representatives of the source to EPA or to state or local
permitting agencies about the source’s plans for operation can be evi-
dence to show intent to circumvent preconstruction review requirements.
1989 Guidance on Limiting PTE at 14-15 (emphasis added).
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B. REDOIL Petitioners Have Not Demonstrated That the Region Clearly Erred in Declining to Require PSD Increment Consumption Analyses for the Kulluk’s Proposed Emissions as Part of the Title V Permitting Process
1. Section 504(e) of CAA Title V Imposes Permitting Requirements
on “Temporary” Stationary Sources
The CAA’s PSD program requires permit applicants to demonstrate compli-
ance with ambient air quality “increments” (also called “PSD increments”) for spe- cific air pollutants. See CAA §§ 161, 163, 165(a)(3)(A), 42 U.S.C. §§ 7471, 7473, 7475(a)(3)(A); 40 C.F.R. § 52.21(c), (k). Such increments are maximum allowable increases in pollutant concentrations that may occur in particular ar- eas.40 They are designed to “prevent significant deterioration” of air quality in lo- cations that already have relatively clean air by ensuring that contaminants con- tributed by proposed new sources, combined with levels of contamination already present in the ambient air as of a specific baseline date, fall within bounds estab- lished by the Agency. See generally NSR Manual ch. C.
As noted in Part VI.A.1.b above, Congress designed the PSD program to
regulate “major” sources of air pollution, which have potential to emit certain spe- cific pollutants in amounts exceeding major source threshold levels. “Minor” sources, which have projected emissions that fall below the PSD major source thresholds, generally are not regulated under the PSD program. The Board deter- mined above that the Kulluk qualifies as a minor source for PSD purposes, and so it is not required to obtain a PSD permit. The Kulluk nonetheless is still subject to permitting under the CAA’s Title V program. The question presented is whether section 504(e) of Title V imposes PSD increment requirements in this circumstance.
In section 504(e) of Title V Congress set out permitting requirements for
“temporary” stationary sources of air pollution as follows:
The permitting authority may issue a single [Title V] per-
mit authorizing emissions from similar operations at mul-
tiple temporary locations. No such permit shall be issued
unless it includes conditions that will assure compliance
with all the requirements of this chapter [i.e., the CAA] at
40 To date, EPA has established PSD increments for four pollutants – SO , NO , PM , and
2 2 10
PM2.5. The increments consist of numeric concentrations, measured in micrograms of pollutant per cubic meter of air, that vary according to averaging period (3-hour, 24-hour, or annual averages) and geographic location (areas designated as “Class I,” “Class II,” or “Class III”). See 40 C.F.R. § 52.21(c) (table of increment levels).
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all authorized locations, including, but not limited to, am-
bient standards and compliance with any applicable incre-
ment or visibility requirements under part C of sub-
chapter I of this chapter [i.e., the PSD program].
CAA § 504(e), 42 U.S.C. § 7661c(e). In allowing for a streamlined permitting process in which a single permit could authorize emissions at multiple temporary locations, Congress explained:
Some sources requiring [Title V] permits do not operate
at fixed locations. These might include asbestos demoli-
tion contractors and certain asphalt plants. Subsection (e)
allows the permittee to receive a permit allowing opera-
tions, after notification to the permitting authority, at nu-
merous fixed locations without requiring a new permit at
each site. Any such permit must assure compliance at all
locations of operation with all applicable requirements of
the Act, including visibility protection and PSD require-
ments and ambient standards.
H.R. Rep. No. 101-490, pt. 1, at 350 (1990).
The parties’ dispute centers on competing interpretations of section 504(e)
and whether, in providing for a streamlined permitting process for temporary sources, Congress intended temporary minor sources to have increment provisions in their Title V permits where the state implementation plans do not otherwise impose increment provisions on such sources.
Section 504(e) is an unusual provision, not only because it addresses tempo-
rary rather than permanent stationary sources of air pollution (which comprise the majority of Title V sources), but also because it imposes substantive air require- ments on temporary sources. As a general matter, Title V is a procedural rather than a substantive statute. It serves as a vehicle for collecting diverse CAA re- quirements otherwise applicable to a source into one all-encompassing air permit for that source. See, e.g., Ohio Pub. Interest Research Grp., Inc. v. Whitman, 386 F.3d 792, 794 (6th Cir. 2004) (“Title V does not impose new obligations; rather, it consolidates pre-existing requirements into a single, comprehensive doc- ument for each source”); Operating Permit Program, 57 Fed. Reg. 32,250, 32,251 (July 21, 1992) (explaining that Title V “generally does not impose substantive new requirements” on sources but instead attempts to “clarify, in a single docu- ment, which requirements apply to a source,” thereby enabling all parties to better understand and track that source’s CAA compliance). For the most part, require- ments that are “applicable” to a source’s emissions units under a Title V permit are directly imposed not by Title V itself but, rather, by state or federal implementa- tion plans, preconstruction permits, the air toxics or acid rain programs, and other
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substantive CAA provisions. See 40 C.F.R. §§ 70.2, 71.2 (definitions of “applica- ble requirements” under state and federal operating permit program regulations, respectively).
To ensure adequate regulation of temporary sources, Congress directed that
Title V permits for such sources must include, as noted above, “conditions that will assure compliance with all the requirements of [the CAA] at all authorized locations, including, but not limited to, ambient standards and compliance with any applicable increment or visibility requirements under [the PSD program].” CAA § 504(e), 42 U.S.C. § 7661c(e). The parties do not dispute that this language serves to impose, through Title V itself, substantive CAA requirements on tempo- rary sources. See REDOIL Petition at 19-25; Region Response at 5-6. Indeed, they agree that, because of section 504(e), the Kulluk’s Title V permit “must con- tain terms and conditions that ensure compliance with the NAAQS at all relevant locations.” Statement of Basis at 26, quoted in Region Response at 5; see REDOIL Petition at 21. The parties strongly dispute, however, whether PSD in- crements should also be included in the complement of substantive requirements for the Kulluk.
2. Under the Region’s Interpretation, PSD Increment Compliance
Demonstrations Are Not Mandatory for Temporary Minor
Sources but May Be Required by States
The Region’s basic position is that section 504(e) uniformly imposes ambi-
ent standards (i.e., NAAQS) compliance requirements on all temporary sources, but that it does not uniformly so impose PSD increment requirements. The Region initially based this distinction on the language of section 504(e) and the imple- menting regulations, as well as on a prior Agency interpretation of these authori- ties. See Statement of Basis at 25-27. The distinction hinged primarily on Con- gress’ insertion of the adjective “applicable” in section 504(e) to modify not “ambient standards” but only “increment or visibility requirements under [the PSD program].” Id. at 26; see CAA § 504(e), 42 U.S.C. § 7661c(e). PSD increments are only “applicable” to a temporary source, the Region reasoned, if the source also qualifies as a PSD major source, obligated to obtain a PSD permit. Statement of Basis at 26 (“applicable” increment requirements are those applicable “under
[the PSD program]” (i.e., part C of subchapter I of the CAA), which covers only PSD major sources). By this logic, the Kulluk, a PSD minor source, would not have to demonstrate compliance with PSD increments at any of its authorized locations. Id.
Commentors on the Kulluk’s draft permit pressed the Region on this point,
which prompted it to take a closer look at the entire issue. The Region prepared a lengthy, detailed Response to Comments document, in which it repeated the above points, but also added a far more robust discussion of the preconstruction permitting programs for major and minor sources. The Region explained that,
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under the statute and implementing regulations, states have discretion to impose PSD increment requirements on PSD minor sources as part of their minor source construction permitting programs, if the states deem such requirements necessary to prevent significant deterioration of air quality. See RTC at 102-09 (citing and discussing, e.g., CAA §§ 110(a)(2)(C), 161, 163, 165(a)(3)(A), 504(e), 42 U.S.C.
§§ 7410(a)(2)(C), 7471, 7473, 7475(a)(3)(A), 7661c(e); 40 C.F.R.
§§ 51.160(a)(2), (b)(2), .166(a)(1), (3), 70.2, 71.2, 71.6(e)). The Region empha- sized that states are not obliged to do this but have discretionary authority to pur- sue this course if they deem it necessary to fulfill their obligations under CAA sections 161 and 163(a). See id. at 103-06.
These clarifications led the Region to encapsulate its understanding of sec-
tion 504(e) and the preconstruction programs in the following way: “PSD major sources are subject to NAAQS and increment in the permitting process, whereas non-PSD sources are subject only to the NAAQS unless the applicable minor source program also includes the [PSD] increment[s].” Id. at 107. The Region concluded that the State of Alaska’s minor source preconstruction program does not require permanent minor sources to demonstrate compliance with PSD incre- ments as a condition of construction, so neither would it require such compliance of temporary minor sources. See id. at 103-04, 107-08; see also Region Response at 12, 11 n.7. For this reason, the Region declined to require that Shell conduct PSD increment compliance analyses for Kulluk emissions at any of its authorized locations in the Beaufort Sea.
The Region’s statutory and regulatory interpretation of the Title V tempo-
rary source program finds support in Board case law that recognizes the states’ primary role in using PSD increments to manage economic growth. In In re West Suburban Recycling & Energy Center, LP, 8 E.A.D. 192 (EAB 1999), the Board observed the following:
From the beginning of the PSD program, EPA has ac-
knowledged that decisions about how increment should
be used or allocated are primarily within the province of
the states. For example, in the preamble to the original
PSD regulations, EPA noted that allocation of PSD incre-
ment could affect economic development and that EPA
should endeavor to preserve the states’ authority on issues
of economic development and growth:
“EPA should not make decisions [that] would
have a significant impact upon future growth
options of the [s]tates.”
8 E.A.D. at 196 (quoting Approval and Promulgation of State Implementation Plans, 43 Fed. Reg. 26,388, 26,401 (June 19, 1978)); accord In re Commonwealth
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Chesapeake Corp., 6 E.A.D. 764, 768 (EAB 1997) (“‘The PSD requirements pro- vide for a system of area classifications [that] affords [s]tates an opportunity to identify local land use goals. * * * Each classification differs in terms of the amount of [industrial or other] growth it will permit before significant air quality deterioration would be deemed to occur.’” (quoting NSR Manual at C.4-.5)).
3. REDOIL Petitioners Have Not Demonstrated That the Region’s
Interpretation Is Clearly Erroneous
On appeal, REDOIL Petitioners claim on a number of grounds that the Re-
gion’s interpretation is clearly erroneous and thus a basis for remand of this per- mit. REDOIL Petition at 19-37. REDOIL Petitioners’ central contention is that the plain language, structure, and purpose of section 504(e) reveal Congress’ “unam- biguously expressed intent” to tie increment requirement applicability to the incre- ment status of the geographic area or areas in which a temporary source will emit pollutants. See id. at 20-32. REDOIL Petitioners also contend that the Agency’s implementing regulations confirm the plain meaning of the statutory language and, additionally, contain provisions that “at least imply” independent obligations to ensure PSD increment compliance. Id. at 33-35.
REDOIL Petitioners observe that section 504(e) distinguishes between am-
bient standards (i.e., NAAQS), which apply to all temporary sources “at all times and in all locations,” id. at 21, and PSD increment standards, which do not apply at all times and in all locations because they “are not universally applicable to all areas.” Id. Rather, as designed by Congress, PSD increments “apply” only in areas where they specifically have been triggered, by means of the submission of an initial, complete PSD permit application to emit in a particular area. Id.; see CAA
§§ 163, 169(4), 42 U.S.C. §§ 7473, 7479(4); 40 C.F.R. § 52.21(b)(14)(ii), (15)(i). The concentration of pollutants in such an area’s ambient air is measured at the time the initial application is submitted (the “baseline date”) and then fixed as the “baseline concentration” for that area. See NSR Manual at C.6-.8, .12-.15. From that point forward, PSD increments serve as the maximum allowable increases that pollutant concentrations may rise above the established baseline levels. CAA
§ 163, 42 U.S.C. § 7473; 40 C.F.R. § 52.21(c).
REDOIL Petitioners reason from this basic design that Congress intended
“applicable increment * * * requirements” in section 504(e) to be area-dependent rather than source-dependent. See REDOIL Petition at 21-22, 25-27, 29. By this logic, any new source, including any new temporary minor source, that proposes to emit in geographic areas where increments previously have been triggered would be obligated to demonstrate compliance with such increments as “applica- ble” requirements under section 504(e). Only in areas where increments have not yet been triggered would PSD increments be inapplicable to temporary minor sources. See id. REDOIL Petitioners claim the Agency’s implementing regula-
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tions are fully in accord with this interpretation and thus do not bar increment compliance demonstrations prior to issuance of Title V permits. Id. at 33-35.
As described below, the Region did not clearly err in its own interpretation
of these authorities. The Board agrees with the Region that its interpretation more fully comports with the structure and language of the CAA and the implementing regulations, and rejects REDOIL Petitioners’ assertion that the statutory language is so plain that there is no ambiguity about whether Congress intended to impose increment provisions on temporary minor sources where the state implementation plan does not otherwise impose increment requirements on such sources. REDOIL Petitioners misapprehend or fail to grapple with several key points that formed the basis for the Region’s interpretation in its final permitting decision and Response to Comments.
a. REDOIL Petitioners Misunderstand Portions of the
Region’s Response to Comments
In several of its points of advocacy before this Board, REDOIL Petitioners
reveal a misunderstanding of the explanations the Region set forth in the Re- sponse to Comments. In the most significant example, REDOIL Petitioners argue that the Region erroneously construes “any applicable increment * * * require- ments under Part C” in section 504(e) to mean that only those temporary sources that are also PSD major sources must demonstrate PSD increment compliance. REDOIL Petition at 29, 33-34. While this description reflects the position the Region advanced in the Statement of Basis,41 it fails to acknowledge the very substantial further interpretive exegesis the Region developed and presented in its Response to Comments on the draft permitting record (which included the State- ment of Basis). In that later and more comprehensive analysis, the Region made clear that, in its view, states have discretionary authority in their minor source preconstruction programs to impose PSD increment requirements on temporary minor sources, either as implementation plan requirements or on a case-by-case basis, as they deem necessary to protect the NAAQS. See RTC at 103-06. REDOIL Petitioners fail to address or demonstrate why the Region’s position, as more fully articulated in the Response to Comments, is clearly erroneous. Be- cause REDOIL Petitioners have failed to substantively confront the Region’s Re- sponse to Comments, they cannot prevail on this ground. See, e.g., In re Guam Waterworks Auth., 15 E.A.D. 437, 450 (EAB 2011) (petitioners “must substan- tively confront the permit issuer’s explanations in its response to comments docu- ment”); In re Peabody W. Coal Co., 12 E.A.D. 22, 33 (EAB 2005) (same).
41 The Region acknowledges that statements in the Statement of Basis could be read to suggest
such an approach. Region Response at 8.
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REDOIL Petitioners also misunderstand the interplay of sections 161, 165,
and 504(e) of the Act, as those provisions are discussed by the Region in the Response to Comments. See RTC at 103-06. REDOIL Petitioners point out that section 163, not section 165, is the source of increment requirements within the PSD program and contends that the Region “ignore[d]” this provision in interpret- ing section 504(e). REDOIL Petition at 30. In so arguing, REDOIL Petitioners take the position that section 504(e) makes the section 163 increments directly applicable to temporary sources. See id. at 30-31. The plain language of sec- tion 163, however, is to the contrary. It provides that “each applicable implemen- tation plan shall contain measures assuring that maximum allowable increases over baseline concentrations [i.e., increments] * * * shall not be exceeded.” CAA
§ 163(a), 42 U.S.C. § 7473(a). Moreover, the text of section 161, which estab- lishes implementation plan requirements, provides that such plans “shall contain emission limitations and such other measures as may be necessary * * * to pre- vent significant deterioration of air quality.” CAA § 161, 42 U.S.C. § 7471.
Increments, in other words, are not directly imposed by section 504(e). In-
stead, they must be implemented (i.e., applied to a source) through either of two means: (1) a state implementation plan, per section 161 and 40 C.F.R.
§ 51.166(a)(1); or (2) the PSD major source permitting program, per sec- tion 165(a)(3)(A) and 40 C.F.R. § 52.21. See RTC at 103-04. Thus, while sec- tion 504(e) can serve as the direct source of NAAQS compliance requirements and other CAA requirements for temporary sources (see infra note 44 and accom- panying text), it only imposes PSD increment requirements to the extent such re- quirements are “applicable” to the source.
Finally, REDOIL Petitioners also suggest that the State of Alaska’s operat-
ing permit regulations are “more lenient” than the federal regulations because they do not require PSD minor sources to demonstrate compliance with PSD incre- ments as a preconstruction condition. REDOIL Petition at 27-28. Noting that the Alaska rules apply to sources on the inner OCS only, and not on the outer OCS, REDOIL Petitioners suggest that the purportedly more stringent federal operating permit rules in effect on the outer OCS require temporary sources situated on the outer OCS to demonstrate compliance with PSD increments. Id. at 28 (citing 40 C.F.R. §§ 71.2, 71.6(e)). REDOIL Petitioners claim, therefore, that Shell must conduct, at the very least, a PSD increment analysis for the Kulluk’s authorized locations on the outer OCS. Id.
This argument reveals a misunderstanding of the Region’s discussion of rel-
evant legal requirements on the inner versus outer OCS. In the Response to Com- ments, the Region explained:
In this case, the requirements for Title V temporary
sources in the inner OCS and outer OCS off of Alaska are
the same because Alaska has adopted EPA’s Part 71 rules
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with respect to Title V temporary sources by reference for
application onshore and Region 10 has in turn adopted
these requirements into the [Corresponding Onshore
Area] regulations for application in the inner OCS.
RTC at 109. As the Region explained, PSD increments are not applicable to any temporary minor sources, wherever they might be located on the OCS, unless a state exercises its discretion to require minor source compliance with such incre- ments. A state, of course, has limited jurisdiction, and its authority does not ex- tend beyond its borders. E.g., CAA § 107(a), 42 U.S.C. § 7407(a) (“[e]ach [s]tate shall have the primary responsibility for assuring air quality within the entire geo- graphic area comprising such [s]tate”). That would mean, therefore, that in the outer OCS or other places where only federal operating permit rules apply, PSD increments would not be applicable to temporary minor sources, unless federal OCS regulations required it or EPA chose to add increment compliance obliga- tions under 40 C.F.R. § 55.13(h)42 once the source becomes operational. See RTC at 109. REDOIL Petitioners fail to squarely confront this legal landscape, which results in a failure to demonstrate how the Region’s interpretation is clearly erro- neous. See, e.g., In re Teck Cominco Alaska, Inc., 11 E.A.D. 457, 494-95 (EAB 2004) (burden of demonstrating review is warranted rests with the peti- tioner, who must raise objections to the permit and explain why the permit issuer’s previous response to those objections is clearly erroneous or otherwise warrants review); In re Westborough, 10 E.A.D. 297, 305, 311-12 (EAB 2002) (same).
b. REDOIL Petitioners Mischaracterize the Title V
Regulatory Scheme
REDOIL Petitioners’ notion that “applicable increment requirements” in
section 504(e) mean “applicable to the area” rather than “applicable to the source” is not supported by the Title V regulatory model as a whole. A Title V permit for a temporary source to operate at multiple locations must include, among other things, “[c]onditions that will assure compliance with all applicable requirements at all authorized locations.” 40 C.F.R. §§ 70.6(e)(1), 71.6(e)(1). Broadly speaking, the Board has recognized that “‘[a]pplicable requirement’ is a term of art in the Title V program that, in general, refers to any substantive requirement that applies to an emissions source under any CAA regulatory provisions.” Peabody,
42 This OCS-specific regulation provides:
If the Administrator determines that additional requirements are neces-
sary to protect [f]ederal and [s]tate ambient air quality standards or to
comply with part C of title I, such requirements will be incorporated in
this part.
40 C.F.R. § 55.13(h).
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12 E.A.D. at 28 n.14 (emphasis added) (citing 40 C.F.R. § 71.2). Further, the reg- ulations implementing the federal Title V program provide that “[a]pplicable re- quirement means all of the following as they apply to emissions units in a part 71 source.” 40 C.F.R. § 71.2 (emphasis added). In turn, the term “emissions unit” means “any part or activity of a stationary source that emits or has the potential to emit any regulated air pollutant.” Id. (emphasis added).
Accordingly, the Region’s interpretation of the term “applicable” in sec-
tion 504(e) as meaning “applicable to the source” is consistent with the Agency’s Title V regulations, in which applicability is determined by reference to the source, not the area. REDOIL Petitioners fail to present legal authorities support- ing their own novel view of applicability in a way sufficient to demonstrate that the Region’s different approach is clearly erroneous.
c. REDOIL Petitioners Confuse Air Quality Management
Obligations with Permitting Obligations
REDOIL Petitioners argue that the Region’s interpretation of section 504(e)
should be rejected because it is inherently inconsistent. REDOIL Petition at 31-32. On the one hand, REDOIL Petitioners note, the Region explicitly recog- nized that the Kulluk will consume a portion of the available PSD increments in its authorized drilling areas, but the Region nonetheless refused to impose precon- struction increment compliance requirements in the Title V permit, finding them “inapplicable.” RTC at 102, 105-06. On the other hand, the Region acknowledged that after the Kulluk becomes operational, it might be necessary to impose incre- ment-related restrictions; i.e., increments would be “applicable.” In the Response to Comments, the Region stated:
If, at any time after the Kulluk begins operation under its
Title V/OCS permit, Region 10 determines that the actual
emissions increases from the permitted OCS source cause
or contribute to an increment violation, Region 10 has au-
thority to adopt additional requirements to ensure that in-
crements are not violated.
Id. at 106 (footnote omitted). REDOIL Petitioners argue that the Region cannot have it both ways, contending on this basis that the Region’s interpretation should not be sustained. REDOIL Petition at 32.
The Board perceives no conflict between the Region’s purportedly “incon-
sistent” positions on increment applicability. As the Region noted in its Response to Comments, EPA has authority, separate and apart from section 504(e) and the preconstruction programs, to address violations of increment standards that might arise once sources become operational. See RTC at 106 (citing CAA §§ 301, 328, 42 U.S.C. §§ 7601, 7627; 40 C.F.R. § 55.13(h)). Moreover, states have authority
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to revise their implementation plans to adopt emission limits and other remedial control measures in cases where existing controls are not adequately protecting air quality increments. 40 C.F.R. § 51.166(a)(3), cited in RTC at 106.43 REDOIL Pe- titioners confuse permitting obligations with ongoing air quality management ob- ligations, but the two are distinct. See RTC at 105-06. Simply positing that the Region’s view of “applicable” increments is inconsistent is not sufficient to over- come the specific statutory and regulatory authority the Region references in sup- port of its position. The Board therefore finds no showing of clear error justifying a remand on this ground.
d. REDOIL Petitioners Misconstrue the Regulations
The Agency’s Title V implementing regulations for state and federal operat-
ing permit programs closely parallel the language of section 504(e). Compare CAA § 504(e), 42 U.S.C. § 7661c(e), with 40 C.F.R. §§ 70.6(e), 71.6(e). The reg- ulations define “applicable requirement” for Title V purposes as (among other things): “(2) [a]ny term or condition of any preconstruction permits” issued under parts C or D of title I; and “(13) [a]ny [NAAQS] or increment or visibility require- ment under part C of title I of the Act, but only as it would apply to temporary sources permitted pursuant to section 504(e) of the Act.” 40 C.F.R. §§ 70.2, 71.2. REDOIL Petitioners argue on appeal, as commentors did on the draft permit, that the Region’s interpretation of “applicable requirement” improperly reads the thir- teenth requirement out of the regulations by subsuming it within the second re- quirement. REDOIL Petition at 33-34.
The Region explained in the Response to Comments why this was not so.
See RTC at 107-08. The Region stated that “the intent of the Title V temporary source provisions is to relieve sources of the burden of applying for Title V per- mits for each new location, while at the same time[] assuring compliance with all requirements to which the source would be subject if it were a new [permanent] source at each such new location.” Id. at 108. For a temporary source that is also a PSD major source, this would include ensuring that the NAAQS and increment standards are met at each future location – a requirement that, the Region pointed out, would exceed the requirements otherwise applicable to the source under the
43 This state implementation plan regulation provides, in relevant part:
If the [s]tate or the Administrator determines that a[n implementation]
plan is substantially inadequate to prevent significant deterioration or
that an applicable increment is being violated, the plan shall be revised
to correct the inadequacy or the violation.
40 C.F.R. § 51.166(a)(3). The regulations also provide, in the next subsection, that the state “shall review the adequacy of a[n implementation] plan on a periodic basis and within 60 days of such time as information becomes available that an applicable increment is being violated.” Id. § 51.166(a)(4).
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PSD program alone.44 Id. at 107. For a temporary source that is also a PSD minor source, this would include ensuring that the NAAQS and, if required under the implementation plan for minor permanent sources, PSD increment standards are met at each future location, even if the implementation plan did not require such a demonstration for temporary minor sources. See id. at 107-08; Region Response at 12.
REDOIL Petitioners fail to meaningfully confront the Region’s reasoning
on this issue or demonstrate why it is clearly erroneous. Instead, REDOIL Peti- tioners reference an irrelevant minor permit modification provision (40 C.F.R.
§ 71.7(e)(1)(i)(A)(3)), rather than a minor source provision, as support for their position. REDOIL Petition at 34. REDOIL Petitioners also suggest that the Ti- tle V permitting regulations in sections 70.6(e) and 71.6(e) establish a more ex- pansive regulatory program than the one the Region finds present in sec- tion 504(e); indeed, one that would even be broad enough to require the Kulluk to demonstrate PSD increment compliance. Id. at 33. The Board finds otherwise, in light of the fact that sections 70.6(e) and 71.6(e) are expressly limited by a refer- ence to section 504(e) itself and therefore cannot expand the meaning of the stat- ute. See RTC at 107-08.
4. Increment Section Conclusion
The Board has carefully examined each of REDOIL Petitioners’ incre-
ment-related arguments and determined that none have merit. Petitioners’ burden is to show clear error, but REDOIL Petitioners have failed in all instances to achieve this standard. The Board therefore denies review of the Permit on this ground.45
C. REDOIL Petitioners Failed to Raise Below Their Contention That Shell’s Ambient Air Quality Analysis Was Flawed in That It Failed to Conform to Applicable Agency Guidance
On February 9, 2010, EPA published in the Federal Register a final rule
(effective April 12, 2010) revising the primary NO2 NAAQS “in order to provide requisite protection of public health as appropriate under section 109 of the Clean Air Act.” Primary NAAQS for NO2, 75 Fed. Reg. 6474, 6475 (Feb. 9, 2010); see also Shell 2010, 15 E.A.D. at 149-50 & n.74. This rule set the new 1-hour NO2
44 As such, the NAAQS and PSD increment requirements for future locations would be “addi-
tional” requirements imposed on the temporary source by section 504(e). RTC at 107-08.
45 In light of the Board’s decision to uphold the Region’s interpretation of section 504(e) and
the implementing regulations, the Board need not reach REDOIL Petitioners’ final argument, which challenges the Region’s finding that air quality modeling establishes the Kulluk’s emissions will not violate the PSD increments.
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NAAQS standard (hereinafter “the 1-hour NO2 NAAQS”) at 100 parts per billion (“ppb”) to supplement the existing annual standard, set at 53 ppb. 75 Fed. Reg. at 6475. EPA regulations specify how attainment of the standard is to be calcu- lated, providing that the 100 ppb standard is met “when the annual 98th percentile of the daily maximum 1-hour average concentration is less than or equal to 100 ppb, as determined in accordance with Appendix S of this part for the 1-hour standard.” 40 C.F.R. § 50.11(f). This calculation is sometimes referred to as “the form.”46 See 75 Fed. Reg. at 6477 n.5, 6492-93. The 100 ppb standard reflects the maximum allowable NO2 concentrations anywhere in an area. Id. at 6493, 6502. EPA has issued guidance clarifying procedures for demonstrating compliance with the new 1-hour NO2 NAAQS. See REDOIL Petition Ex. 16 (Memorandum from Stephen D. Page, Dir., Office of Air Quality Planning & Standards, U.S. EPA, to Reg’l Air Dirs., U.S. EPA, Guidance Concerning the Implementation of the 1-Hour NO2 NAAQS for the Prevention of Significant Deterioration (June 29, 2010) (“Page Memo”));47 Memorandum from Tyler Fox, Leader, Air Quality Monitoring Grp., Office of Air Quality Planning & Standards, U.S. EPA, to Reg’l Air Dirs., U.S. EPA, Additional Clarification Regarding Application of Appen- dix W Modeling Guidance for the 1-Hour NO2 National Ambient Air Quality Standard (Mar. 1, 2011) (“Fox Memo”) (A.R. BB-83).
REDOIL Petitioners assert that Shell’s ambient air quality analysis was
flawed.48 In particular, REDOIL Petitioners state that in “identifying the Kulluk’s
46 The 98th percentile form corresponds approximately to the 7th or 8th highest daily maxi-
mum concentration in a year. 75 Fed. Reg. at 6492.
47 According to the Page Memo, the guidance was issued in response to reports that sources
were modeling potential violations of the 1-hour NO2 NAAQS. Page Memo at 1. The Memo states that “[t]o respond to these reports and facilitate the PSD permitting of new and modified major stationary sources, we are issuing the attached guidance in the form of two memoranda.” Id. The attached mem- oranda are titled “General Guidance for Implementing the 1-hour NO2 National Ambient Quality Stan- dard in Prevention of Significant Deterioration Permits, Including an Interim 1-hour NO2 Significant Impact Level” and “Applicability of Appendix W Modeling Guidance for the 1-hour NO2 National Ambient Air Quality Standard.” Id. at 1-2. Although the Page Memo attaches these two memoranda, the Memo is consecutively numbered as a single document.
48 In order to establish compliance with the NAAQS and PSD increments, permit applicants
must conduct an “ambient air quality analysis,” which applicants must prepare under the permitting rules for each regulated pollutant their proposed facilities will emit in “significant” amounts. 40 C.F.R.
§ 52.21(b)(23)(i), (m)(1)(i). This analysis predicts a pollutant’s future concentration in the ambient air by modeling a proposed facility’s expected emissions of the pollutant against the backdrop of existing ambient conditions. To conduct an air quality analysis, a permit applicant compiles data on the pro- posed facility’s physical specifications and anticipated emission rates, local topography, existing ambi- ent air quality, meteorology, and related factors. See, e.g., id. § 52.21(l), (m); id. pt. 51 app. W (Guide- line on Air Quality Models); In re Knauf Fiber Glass, GmbH, 8 E.A.D. 121, 145-48 (EAB 1999); NSR Manual at C.16-.23, .31-.50. These data are then processed using mathematical models that calculate the rates at which pollutants are likely to disperse into the atmosphere under various climatological conditions, with the goals of determining whether emissions from the proposed source will cause or
Continued
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98th percentile cumulative impact – i.e., the Kulluk’s impact added to background levels of pollutants – for comparison to the 1-hour NO2 standard, Shell used an approach that the Region admits is ‘less conservative.’ More specifically, Shell used background values that were already adjusted to the 98th percentile, instead of basing its calculations on the full distribution of background values.” REDOIL Petition at 38 (footnote omitted). According to REDOIL Petitioners, this method for demonstrating compliance with the 1-hour NAAQS was rejected in the Page Memo as “not being protective of the [NAAQS].” Id. at 38-39 (quoting Page Memo at 18). REDOIL Petitioners then cite to a portion of the more recent Fox Memo which, according to them, allows for the method Shell used to calculate background values. Id. at 39. That is, the Fox Memo states that the approach used in the Page Memo was overly conservative and should not be used in certain cases. Id. (citing Fox Memo at 17-20). REDOIL Petitioners assert that the Region allowed Shell to demonstrate compliance with the form of the 1-hour NAAQS using the approach permitted in the Fox Memo without providing an explanation as to why the determination in the Page Memo was incorrect. Id. at 40. REDOIL Petitioners argue that “[b]ecause neither EPA nor the Region provided any expla- nation about whether and, if so, how, its earlier conclusion [in the Page Memo] that the use of the 98th percentile background values is ‘not protective’ of the national ambient air quality standard was incorrect, EPA’s new guidance and the approach taken by the Region here in reliance on it are arbitrary.” Id. (quoting Page Memo at 17-20). REDOIL Petitioners contend that the Region had an obli- gation to explain this “departure from its prior analysis.” Id. at 40-41.
Upon examination of the record, the Board concludes that this issue was not
adequately raised during the comment period and was therefore not preserved for review. As stated above, the regulations require any person who believes that a permit condition is inappropriate to raise “all reasonably ascertainable issues and
-
-
- all reasonably available arguments supporting [petitioner’s] position” dur-
ing the comment period on the draft permit. 40 C.F.R. § 124.13. That requirement is made a prerequisite to appeal by 40 C.F.R. § 124.19(a), which requires any petitioner to “demonstrat[e] that any issue[] being raised [was] raised during the public comment period * * * to the extent required[.]”. In re ConocoPhillips Co., 13 E.A.D. 768, 800-01 (EAB 2008); accord In re Christian Cnty. Genera- tion, LLC, 13 E.A.D. 449, 457 (EAB 2008); Shell 2007, 13 E.A.D. at 394 n.55.
- all reasonably available arguments supporting [petitioner’s] position” dur-
The requirement that an issue must have been raised during the public com-
ment period in order to preserve it for review is not an arbitrary hurdle placed in the path of potential petitioners. Russell City II, 15 E.A.D. at 10; In re City of Marlborough, 12 E.A.D. 235, 244 n.13 (EAB 2005), appeal dismissed for lack of -
(continued)
contribute to a violation of either the NAAQS or the PSD increments. See 40 C.F.R. § 52.21(f); id. pt. 51 app. W; NSR Manual at C.24-.27, .51-.70.
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584 ENVIRONMENTAL ADMINISTRATIVE DECISIONS
juris., No. 05-2022 (1st Cir. Sept. 30, 2005); In re BP Cherry Point, 12 E.A.D. 209, 219 (EAB 2005). Rather, the requirement serves an important function related to the efficiency and integrity of the overall administrative per- mitting scheme. Marlborough, 12 E.A.D. at 244 n.13. The intent of the rule is to ensure that the permitting authority first has the opportunity to address permit objections and to give some finality to the permitting process. Id.; In re Sutter Power Plant, 8 E.A.D. 680, 687 (EAB 1999). As the Board has explained, “[t]he effective, efficient and predictable administration of the permitting process de- mands that the permit issuer be given the opportunity to address potential problems with draft permits before they become final.” In re Teck Cominco, 11 E.A.D. 457, 481 (EAB 2004) (quoting In re Encogen Cogeneration Facility, 8 E.A.D. 244, 250 (EAB 1999)). “In this manner, the permit issuer can make timely and appropriate adjustments to the permit determination, or, if no adjust- ments are made, the permit issuer can include an explanation of why none are necessary.” In re Essex Cnty. (N.J.) Res. Recovery Facility, 5 E.A.D. 218, 224 (EAB 1994).
Although REDOIL Petitioners’ comments on the draft permit asserted that
Shell had used background ambient air data in a manner that understated the im- pact of its operations, see REDOIL Comments at 9-11, nowhere in these com- ments did Petitioners assert that Shell’s approach conflicted with the Page Memo or that the Region had any obligation to provide an explanation for its alleged departure from the Page Memo. Indeed, REDOIL Petitioners’ comments recog- nized that, according to the Fox Memo, Shell’s approach is appropriate in some circumstances. Id. at 11. The comments, however, did not assert any conflict be- tween the Page Memo and the Fox Memo nor is it clear to this Board that any such conflict exists. Thus, this “battle of the memos” issue was not preserved for review.49 See Shell Discoverer 2012, 15 E.A.D. at 507.
49 See Teck Cominco, 11 E.A.D. at 481-82 (denying review where issue was not specifically
raised during the comment period). The Board notes that the issue REDOIL Petitioners did raise dur- ing the comment period was fully and adequately addressed in the Region’s Response to Comments. Specifically, in commenting on the draft permit, REDOIL Petitioners raised the argument that Shell had failed to demonstrate compliance with the 1-hour NO2 NAAQS because, according to REDOIL Petitioners, Shell used background ambient air data in a manner that understated the impact of its operations. REDOIL Comments at 10-11. As stated above, REDOIL Petitioners’ comments recognized that Shell’s approach to analyzing background data was consistent with the Fox Memo, but argued that Shell’s approach was inconsistent with the 1-hour NO2 NAAQS standard itself. Id. at 11. The Region provided a detailed response to this assertion in the Response to Comments. RTC at 74-78. Nothing in the REDOIL Petition indicates why the Region’s response on this issue was erroneous or otherwise warrants Board review, nor does the Board find anything erroneous in the Region’s response. Thus, even if Petitioners had preserved this issue, the Board would deny review. See, e.g., In re Guam Wa- terworks Auth., 15 E.A.D. 437, 450 (EAB 2011) (stating that “a petitioner may not simply reiterate comments made during the public comment period, but must substantively confront the permit issuer’s explanations in its response to comments document”); In re Peabody W. Coal Co., 12 E.A.D. 22, 33 (EAB 2005) (same).
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D. REDOIL Petitioners Have Not Demonstrated That the Region Clearly Erred in Its Ambient Air Exemption Determination
REDOIL Petitioners allege that the Region clearly erred in exempting the
area within a 500 meter radius from the Kulluk from the definition of “ambient air.”50 REDOIL Petition at 15. This area is also referred to throughout the record as the United States Coast Guard (“USCG”) “safety zone.” See, e.g., RTC at 52-54. REDOIL Petitioners claim that the Region’s decision “contravenes both EPA’s definition of ‘ambient air’ as well as EPA’s longstanding interpretation of that reg- ulation.” REDOIL Petition at 16. In particular, they assert that the Region’s 500 meter ambient air boundary fails to meet either of the two criteria the Agency has previously used in evaluating the appropriateness of an exemption. Id. at 16-18. According to REDOIL Petitioners, the Region’s decision essentially al- lows Shell to emit more pollution, and possibly with fewer controls, than would otherwise be lawful.51 Id. at 15-16.
The CAA regulations define “ambient air” as “that portion of the atmos-
phere, external to buildings, to which the general public has access.” 40 C.F.R.
§ 50.1(e). Based on this definition, the Agency has, on occasion, exempted certain areas from the definition of ambient air. E.g., Letter from Steven C. Riva, Chief, Permitting Sec., U.S. EPA Region 2, to Leon Sedefian, Air Pollution Meteorolo- gist, N.Y. State Dep’t of Env’t Conservation, at 1-2 (Oct. 9, 2007) (A.R. BB-19)
[hereinafter Broadwater Letter]; Letter from Douglas M. Costle, Adm’r, U.S. EPA, to Sen. Jennings Randolf, Chairman, Env’t & Pub. Works Comm., at 1 (Dec. 19, 1980) (A.R. BB-1) [hereinafter Costle Letter]; see also Letter from Nancy Helm, Fed. & Delegated Air Programs, U.S. EPA, to John Kuterbach, Alaska Dep’t of Envtl. Quality, at 2 (Sept. 11, 2007) (area exempt if certain condi- tions met) [hereinafter Helm Letter]. The parties agree that the Agency’s “long- standing interpretation” of this exemption is set forth in a letter signed by former EPA Administrator Douglas Costle, which states that “the exemption from ambi-
50 For an area that is not considered within the definition of “ambient air,” Shell would not
have to demonstrate compliance with the NAAQS. See CAA §§ 109(b), 160, 163, 42 U.S.C.
§§ 7409(b), 7470,7473 (NAAQS apply to areas meeting the definition of ambient air); 40 C.F.R.
§ 50.1(e) (definition of “ambient air”); In re Hibbing Taconite Co., 2 E.A.D. 838, 848 & nn.23-24 (Adm’r 1989); RTC at 53.
51 REDOIL Petitioners additionally argue that, should the Region’s response contain a “natural
physical feature” argument similar to an argument the Region raised in its response brief in Shell Discoverer 2012, the Board should consider such an argument a “post hoc rationalization” and should disallow it. REDOIL Petition at 19; see also Shell Discoverer 2012, 15 E.A.D. at 510 n.52 (discussing this issue). REDOIL Petitioners also reserve the right to request leave to file a reply brief addressing this issue. REDOIL Petition at 19. Unlike the situation in Shell Discoverer 2012, the Board does not find that the Region’s response brief contains an explanation that is clearly different than the rationale set forth in the Response to Comments. Moreover, REDOIL Petitioners do not raise this particular issue in their reply brief. Consequently, the Board does not consider REDOIL Petitioners’ “post hoc rationalization” argument further.
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ent air is available only for the atmosphere over land owned or controlled by the source and to which the public access is precluded by a fence or other physical barriers.” Costle Letter at 1; REDOIL Petition at 16 (quoting same letter); Region Response at 29-30 (referring to same letter); Shell Response at 26-27 & n.27 (same); see also RTC at 51 (same). The Costle Letter also indicates that, in deter- mining whether the exemption applies, the Agency reviews “individual situations on a case-by-case basis.” Costle Letter at 1; see also Approval and Promulgation of State Implementation Plans, 50 Fed. Reg. 7056, 7057 (Feb. 20, 1985) (noting that, in considering ambient air exemptions, “individual variations in the type of land and nature of the limitation on access necessitate a case-by-case evaluation of the facts, and application of the principles involved in this determination”).
Here, in its permitting decisions, the Region determined that, as long as cer-
tain permit conditions were being met, it was appropriate to set the ambient air boundary at a 500 meter radius from the Kulluk, or, in other words, the 500 meter radius “safety zone” was exempt from the ambient air definition. RTC at 51-52; see also Statement of Basis at 40. The terms and conditions upon which the Re- gion relied to exempt this area prohibit the operation of vessels and emissions units unless (1) the USCG establishes a safety zone within at least 500 meters from the center of the Kulluk, (2) members of the public are precluded from enter- ing the safety zone, and (3) Shell develops and implements a “public access con- trol program.”52 Permit at 42-43. The Region determined that, as long as these safety zone and public access restriction permit conditions are complied with, ex-
52 The precise terms and conditions of the Permit are as follows:
The permit does not authorize operation unless:
5.1.1. The Kulluk is subject to a currently effective safety zone estab-
lished by the [USCG] which encompasses an area within at least
500 meters from the hull of the Kulluk and which prohibits members of
the public from entering this area except for attending vessels or vessels
authorized by the USCG (such area shall be referred to as the “Safety
Zone”); and
5.1.2. The permittee has developed in writing and is implementing a
public access control program to:
5.1.2.1. Locate, identify, and intercept the general public by radio, physi-
cal contact, or other reasonable measures to inform the public that they
are prohibited by Coast Guard regulations from entering the Safety
Zone; and
5.1.2.2. Communicate to the North Slope communities on the Beaufort
Sea on a periodic basis when exploration activities are expected to begin
and end at a drill site, the location of the drill site, and any restrictions on
activities in the vicinity of the Kulluk’s exploration operations.
Permit at 42-43.
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empting the area within the safety zone from the ambient air definition would generally be consistent with previous Agency interpretations. RTC at 51-52. In so finding, the Region noted that “[g]iven that the permitted activities occur over open water in the Arctic, the[] criteria [for exemption included in the Costle Let- ter] must be adapted to some extent when applied to this environment.” Id. In specifically considering the applicability of the two exemption criteria, the Region stated:
Region 10 recognizes that Shell does not “own” the areas
of the Beaufort Sea on which the Kulluk will be operating
as might be the case for a stationary source on land. Shell
has a lease authorizing the company to use these areas for
the activities covered by the permits. A Coast Guard
safety zone establishes legal authority for excluding the
general public from the area inside the zone. EPA has pre-
viously recognized a safety zone established by the Coast
Guard as evidence of sufficient ownership or control by a
source over areas over water so as to qualify as a bound-
ary for defining ambient air where that safety zone is
monitored to pose a barrier to public access. Letter from
Steven C. Riva, EPA Region 2, to Leon Sedefian, New
York State Department of Conservation, re: Ambient Air
for the Offshore LNG Broadwater Project, dated Octo-
ber 9, 2007 (Broadwater Letter).
To meet the second of the criteria applied by EPA and
ensure the source actually takes steps to preclude public
access, Shell proposed and Region 10 required as a condi-
tion of operation under the permits that Shell develop in
writing and implement a public access control program to
locate, identify, and intercept the general public by radio,
physical contact, or other reasonable measures to inform
the public that they are prohibited by Coast Guard regula-
tions from entering the area within 500 meters of the hull
of the Kulluk. Region 10 believes that, for the overwater
locations in the arctic environment at issue in these per-
mitting actions, such a program of monitoring and notifi-
cation is sufficiently similar to a fence or physical barrier
on land such that the area within the Coast Guard safety
zone qualifies for exclusion from ambient air. See Broad-
water Letter at 2.
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RTC at 52.53
Upon consideration of the administrative record and the parties’ arguments,
the Board concludes that Petitioners have not shown that the Region clearly erred in its decision to exempt the area within the USCG safety zone from the definition of “ambient air.” The Region, in its Response to Comments, provided a reasonable interpretation of the ambient air regulation and the Agency’s “longstanding inter- pretation” of that regulation as applied in the OCS context.54 Furthermore, the Re- gion’s analysis was entirely consistent with a similar analysis undertaken by Re- gion 2 in which that Region determined that it was appropriate for a permittee to use the USCG safety zone to define an ambient air boundary around a proposed offshore liquefied natural gas facility. See Broadwater Letter at 2. The Broadwater Letter, moreover, suggests that Region 2’s analysis, as well as Region 10’s, is not unique, stating that “[i]n previous permitting decisions involving * * * drilling operations, EPA Regional offices have used the USCG’s safety zone as the bound- ary for defining ambient air.” Id. at 2 (emphasis added). The letter explains that the Agency has found that “[t]he ‘safety zone’ approach represents a reasonable surrogate for a source’s fence or physical barrier and thus could act as an ambient air boundary.” Id.
Thus, while it is true, as Petitioners allege, that the Agency has generally
required the source to own or control access over the area in question for that area to meet the first criterion, REDOIL Petition at 16-17, this requirement has been limited to sources located on land.55 See, e.g., Helm Letter at 1 (referring to possi-
53 REDOIL Petitioners also seem to suggest that the Region’s approach is flawed because it “is
based upon an assumption that Shell will request, and the [USCG] will establish, a safety zone restrict- ing the passage of other vessels.” REDOIL Petition at 15 & n.45. This argument is unpersuasive be- cause it fails to recognize that, as the permit conditions quoted in note 52 state, operation is prohibited unless these two conditions are met. See Permit at 42-43.
54 As the Region rightly noted, see RTC at 51-52, the regulation and the Costle Letter, by their
very terms, were clearly written with overland situations in mind. See 40 C.F.R. § 50.1(e) (referring to “buildings”); Costle Letter at 1 (referring to “land” and “fences”).
55 In support of their contention, REDOIL Petitioners rely on a previous Agency determination
that leased property could not be exempted from the definition of ambient air because the lessee did not have control over access to its leased property (only the landlord did). REDOIL Petition at 17 & n.52 (citing Helm Letter). Petitioners assert that this onshore interpretation must apply equally to an OCS lease BOEMRE issued. Id. As the Petitioners themselves note, federal courts have found agency action to be arbitrary when the agency’s “explanation ‘runs counter to the evidence,’” id. at 17 (quoting Motor Vehicle Mfrs. Ass’n of the U.S., Inc. v. State Farm Mut. Auto Ins. Co., 463 U.S. 29, 43 (1983)), and “‘the agency offer[s] insufficient reasons for treating similar situations differently,’” id. (quoting Transactive Corp. v. United States, 91 F.3d 232, 237 (D.C. Cir. 1996)); see also FCC v. Fox Televi- sion Stations, Inc., 556 U.S. 502, 514-15, 129 S.Ct. 1800, 1810-11 (2009) (discussing standard of review of an agency’s policy change). Here, not only are the situations dissimilar enough to arguably not be governed by these cases, but the Agency did offer persuasive reasons for treating the two situa- tions differently.
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ble exemption near coal-fired power plant); Memorandum from Steven D. Page, Director, Office of Air Quality Planning & Standards, U.S. EPA, to Reg’l Air Div. Dirs., U.S. EPA, Interpretation of “Ambient Air” in Situations Involving Leased Land Under the Regulations for the Prevention of Significant Deterioration (PSD) (June 22, 2007) (A.R. B-26) (discussing the applicability of the exemption where a source is located on “land” leased to them by another source). The Region (and the Agency before it) reasonably determined that application of the regulation and the interpretive letter to an “overwater” situation requires some leeway. REDOIL Petitioners’ reliance solely on land-based exemption decisions is thus unpersua- sive.56 Finally, as mentioned above, the Agency has consistently taken the posi- tion that ambient air exemption determinations are analyzed on a case-by-case basis.
For all the reasons stated above, REDOIL Petitioners have not shown that
the Region clearly erred in its ambient air exemption determination.57 Conse- quently, review of the Permit based on this issue is denied.
E. ICAS and Mr. Lum Have Not Demonstrated That the Region Failed to Satisfy Its Obligation to Comply with Executive Order 12898 and Applicable Board Precedent
ICAS and Mr. Lum argue that the Region’s environmental justice analysis
lacked a valid basis on which to conclude that Shell’s oil exploration activities in the Beaufort Sea will not have a disproportionately high and adverse effect on the health of the Alaska Native population living on the North Slope. ICAS alleges that the Region’s environmental justice analysis fails to account for the impacts of short-term NO2 and ozone exposures on the Alaska Native population residing on the North Slope, and also asserts that the opportunities for public participation were inadequate. Mr. Lum challenges the lack of analysis regarding the impacts
56 REDOIL Petitioners’ arguments that the Region’s determination fails to meet the second
criteria because the safety zone “fails to effectuate a barrier that ‘precludes’ public access” are equally unpersuasive. REDOIL Petition at 17. REDOIL Petitioners focus on the fact that the USCG will limit access to the area based on safety concerns rather than for air quality considerations. Id. at 17-18. The important fact is that access within the zone will be strictly limited, not the reason behind it. Moreover, REDOIL Petitioners do not address the other condition of the permit that the Region relied upon for its ambient air boundary determination: the public access control program Shell is required to implement. The Board does not find clear error in the Region’s conclusion that, based on the USCG limiting access to the safety zone and the permittee implementing a public access control program, the latter of which will include notification to the local residents of the location of the drilling and the fact that the public is restricted from the safety zone, the general public will be denied access to the area inside the safety zone.
57 The Board came to the same conclusion in Shell Discoverer 2012. See 15 E.A.D. at 513-14.
In that case, the Region had adopted and followed the same or a very similar interpretation as de- scribed in the text above. See id. 15 E.A.D. at 511-13. Nothing REDOIL Petitioners offer in the pre- sent case convinces the Board that anything in the prior analysis – and reiterated here – was in error.
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emissions from Shell’s activities in the Beaufort Sea could have on traditional subsistence food sources and also challenges Shell’s oil spill response capabilities. The Region counters that its environmental justice analysis and resulting conclu- sions comply with Executive Order 12898, “Federal Actions to Address Environ- mental Justice in Minority Populations and Low Income Populations” (“Executive Order”). The issue the Board must resolve is: did the Region satisfy its obligation to comply with the Executive Order and applicable Board precedent?
The Executive Order states in relevant part:
Agency Responsibilities. To the greatest extent practica-
ble and permitted by law, and consistent with principles
set forth in the report on the National Performance Re-
view, each Federal agency shall make achieving environ-
mental justice a part of its mission by identifying and ad-
dressing, as appropriate, disproportionately high and
adverse human health or environmental effects of its pro-
grams, policies, and activities on minority and
low-income populations * * * .
Exec. Order 12898, 59 Fed. Reg. 7629, 7629 (Feb. 11, 1994) (A.R. FF-1). Federal agencies are required to implement the Executive Order “consistent with, and to the extent permitted by, existing law.” Id. at 7632. The Board has held that a permit issuer should exercise its discretion to examine any “superficially plausi- ble” claim that a minority or low-income population58 may be disproportionately affected by a particular facility seeking a PSD permit. In re EcoEléctrica, LP, 7 E.A.D. 56, 69 n.17 (EAB 1997); accord Shell 2010, 15 E.A.D. at 148-49 & n.71 (citing PSD cases).
At the outset, the Board notes that both ICAS and Mr. Lum recently chal-
lenged the Region’s environmental justice analysis in Shell Discoverer 2012. See 15 E.A.D. at 493-501. In addition, the environmental justice analysis the Re- gion prepared in the current matter is reminiscent of the environmental justice analysis prepared for the Discoverer permits that were the subject of the Board’s Shell Discoverer 2012 decision. Moreover, while their petitions for review in Shell Discoverer 2012 and the current appeal are not identical, both ICAS and Mr. Lum raise substantially similar arguments in their current appeals as they did in their appeals of the Discoverer permits.59 Compare Lum Petition with Eskimo
58 Under the Executive Order, the Alaska Native population residing on the North Slope quali-
fies as a minority population. See Statement of Basis at 55; ICAS Petition at 30.
59 ICAS’s remaining challenges to the amount and quality of public participation opportunities
available pertaining to the environmental justice analysis appear to mirror its more general arguments
Continued
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Whaler Petition for Review, Shell Discoverer 2012 (Doc. No. 24), and ICAS Peti- tion with ICAS and AEWC Petition for Review, Shell Discoverer 2012 (Doc. No. 7).
1. Region’s Environmental Justice Analysis
The Region included a fifteen-page environmental justice analysis in the
administrative record to accompany the Permit and to allow for public comment on the analysis. Environmental Justice Analysis for Proposed OCS Permit No. R10 OCS030000 Kulluk Drilling Unit (undated) (“EJ Analysis”) (A.R. F-1). The Region’s analysis begins with a discussion of environmental justice in the permitting context and notes that “[t]he Title V operating permit program does not generally impose new substantive air quality control requirements.”60 EJ Analysis at 2. In addition, the analysis includes a discussion of how the national ambient air quality standards (“NAAQS”) are crafted by integrating scientific information and evidence from rigorously reviewed studies, and a summary of the Board’s case law stating that the Board views compliance with the NAAQS as “emblematic of achieving a level of public health protection that, based on the level of protection afforded by the NAAQS, demonstrates that minority or low-income populations will not experience disproportionately high and adverse human health or environ- mental effects due to exposure to relevant criteria pollutants.” Id. (quoting Shell 2010, 15 E.A.D. at 156) (citations omitted); see also Statement of Basis at 54-55.
(continued)
regarding the public participation process. See ICAS Petition at 6-10, 38-39. Accordingly, the Board addresses ICAS’s challenges to the adequacy of the public participation process, both generally and with respect to the environmental justice analysis, in Parts VI.F and VI.G below.
60 The Region further explained that:
[T]he Title V operating permit program is generally a vehicle for ensur-
ing that existing air quality control requirements are appropriately ap-
plied to facility emission units and that compliance with these require-
ments is assured. Accordingly, the primary means of addressing
environmental justice issues in the Title V program is through increased
public participation and review by permitting agencies, and conditions to
assure compliance with applicable requirements. As discussed above,
the Title V permit at issue in this case is unusual in that it requires the
source, as a Title V temporary source, to meet the NAAQS and also
establishes limits on the potential to emit. Region 10 has considered en-
vironmental justice concerns in this permitting action where possible in
the context of assuring compliance with applicable requirements for the
source, in particular assuring compliance with the NAAQS as a Title V
temporary source and establishing PSD avoidance limits.
EJ Analysis at 2; see also Statement of Basis at 54.
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The analysis goes on to catalogue the distances between In~upiat communi-
ties on the coast of the North Slope that are closest to Shell’s lease blocks in the Beaufort Sea, and discusses the importance of subsistence foods obtained through hunting, fishing, and whaling to the In~upiat diet, and more generally the nexus between subsistence activities and In~upiat culture. EJ Analysis at 3, 5. The Re- gion also included an illustration that juxtaposes the location of Shell’s lease blocks, including proposed exploration sites, with onshore and offshore subsis- tence use areas for the northern In~upiat communities.61 Id. at 4; see also State- ment of Basis at 56.
The Region then proceeded to analyze demographic, health-related, and air
quality data.62 The demographic analysis indicates that 68% of residents living in the North Slope Borough classify themselves as Alaska Natives. EJ Analysis at 7. In addition, nearly half of North Slope residents speak a language other than En- glish at home. Id. at 8. The analysis of health data revealed, among other things, that from 1990 to 2007 there has been a 158% rate of increase in the prevalence of diabetes for Alaska Natives residing on the Arctic Slope, whereas during the same time period there has been a 117% rate of increase in the prevalence in diabetes for Alaska Natives statewide.63 Id. at 9. In addition, there is a higher incidence of outpatient visits for respiratory problems ranging from the common cold to pneu- monia in the Arctic Slope than in the rest of Alaska. Id.
In the air impacts analysis, the Region first noted that the North Slope Bor-
ough is currently designated as attainment/unclassifiable for all of the NAAQS, meaning that the North Slope has sufficient data to determine that the area is meeting the NAAQS or that, due to no data or insufficient data, EPA cannot make a determination. Id. at 11 & n.15 (citing CAA § 107(d), 42 U.S.C. § 7407(d)). The
61 The analysis also includes, for some of the northern In~upiat communities, the distances re-
sidents have reported traveling offshore to hunt for traditional subsistence food sources. See EJ Analy- sis at 6 (noting that Nuiqsut residents have traveled up to 60 miles offshore to the north and as far east as Camden Bay to hunt for bowhead whale and that Kaktovik residents have traveled as far as 35 miles offshore to hunt for bowhead whale and walrus); Statement of Basis at 55; see also Shell 2010, 15 E.A.D. at 155 n.80 (noting that subsistence activities, which can take In~upiat residents living on the North Slope far from their local communities and closer to emissions sources, are a potential environmental justice consideration that may be unique to the OCS PSD permitting context); Shell Discoverer 2012, 15 E.A.D. at 496 n.32 (same).
62 The Region used demographic information gathered from the 2000 U.S. Census to compare
the population of the North Slope Borough to the populations of both the State of Alaska and the entire United States, which served as reference populations for the demographic analysis. EJ Analysis at 6-8
& n.6. The North Slope Borough consists of the following eight incorporated villages: Point Hope, Point Lay, Wainwright, Atqasuk, Barrow, Nuiqsut, Kaktovik, and Anaktuvuk Pass. See Statement of Basis at 55.
63 The Region utilized data from the Alaska Native Health Status Report 2009, which the
Alaska Native Epidemiology Center and the Alaska Native Tribal Health Consortium had prepared to analyze health conditions in the North Slope Borough. See EJ Analysis at 8-10 & n.11.
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Region then examined the total modeled concentrations of NO2, particulate matter with a diameter of 10 micrometers or less (“PM10”), particulate matter with a di- ameter of 2.5 micrometers or less (“PM2.5”), SO2, and CO,64 including background concentrations and maximum concentrations from the Kulluk and the Associated Fleet.65 Id. at 13-14 & tbl.6. The Region compared the total modeled concentra- tions for each of the three nearest communities while the source is in operation and found that the total maximum modeled concentrations demonstrate that the NAAQS will be attained at all locations beyond the 500-meter boundary, and that the modeled concentrations in the North Slope communities and in areas where the communities conduct subsistence activities will be below the relevant stan- dard.66 Id. at 14. Finally, the Region noted that a majority of the total impacts result from background concentrations. Id.
64 The Board notes that the information included in table 5 of the air quality analysis includes
modeled impacts in the nearest onshore communities from operation of the Kulluk alone, without im- pacts from the Associated Fleet or background concentrations. EJ Analysis at 12 & tbl.5. The Region explains that the maximum modeled concentrations in Nuiqsut, Deadhorse, and Kaktovik listed in table 5 are all below the significant impact levels (“SILs”) established for each criteria pollutant. Id. at 12. In the PSD program, SILs function as threshold levels for ambient concentrations of a given pollutant; for a given pollutant and averaging period, any source that has a measured concentration that is below the SIL is considered too small to cause or contribute to a violation of the NAAQS. Id.
The Region made clear earlier in the environmental justice analysis that emissions from the
Associated Fleet while operating within 25 miles of the Kulluk, together with emissions from the Kulluk, are considered in conducting an ambient air quality analysis to determine whether emissions from the project will cause or contribute to a violation of the NAAQS. Id. at 4. The Region’s analysis repeatedly emphasized that compliance with the NAAQS is “emblematic of achieving a level of public health protection” that demonstrates that minority or low-income populations will not experience dis- proportionately high and adverse human health or environmental impacts due to exposure to relevant criteria pollutants. Id. at 4-5 (quoting Shell 2010, 15 E.A.D. at 156). While the inclusion of informa- tion on modeled impacts of emissions from the Kulluk alone on the nearest onshore communities is illustrative regarding the Kulluk’s contribution to the overall emissions profile, it is the information that encompasses both background concentrations and emissions from the Kulluk and the Associated Fleet when it is within 25 miles of the Kulluk that establishes the Region has satisfied its obligation to comply with the Executive Order.
65 Monitoring data from Prudhoe Bay, Deadhorse, and Endicott were used for background val-
ues. EJ Analysis at 13. The Region also noted that the modeled impacts are based on conservative assumptions, including that all four wells are drilled at the same location to account for overlapping plumes, even though the drilling of four wells at a fixed location and the overlap of plumes will not occur. Id.
66 Specifically, the Region noted that in Kaktovik, located 8 miles from Shell’s closest lease
block in the Beaufort Sea, the total maximum modeled concentrations, assuming Shell’s Discoverer is in operation and considering background concentrations, are measured at the following percentages of the NAAQS: 11% for the 1-hour NO2 NAAQS; 20% for the 24-hour PM2.5 NAAQS; 35% for the 24-hour PM10 NAAQS, and; 20% for the annual PM2.5 NAAQS. EJ Analysis at 13-14 & tbl.6. Simi- larly, in Nuiqsut, located 33 miles from Shell’s closest lease block in the Beaufort Sea, and applying the same assumptions, the total maximum modeled concentrations are measured at the following per- centages of the NAAQS: 50% for the 1-hour NO2 NAAQS; 48% for the 24-hour PM2.5 NAAQS, 35% for the 24-hour PM10 NAAQS, and 26% for the annual PM2.5 NAAQS. Id.
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Overall, the Region concluded that Shell’s proposed OCS activities in the
Beaufort Sea will not result in disproportionately high and adverse human health or environmental effects with respect to Alaska Natives residing on the North Slope, and further, in reaching this conclusion the Region considered the impact on these communities while engaging in subsistence activities in the areas where such activities are regularly conducted. Id. at 15. With this background in mind, the Board now turns to the specific assertions both ICAS and Mr. Lum make in support of their arguments that the Region has not complied with its obligation under the Executive Order.
2. One-Hour NO2 NAAQS Analysis
ICAS challenges the Region’s consideration of 1-hour NO2 NAAQS67 com-
pliance in the environmental justice analysis on several grounds, arguing that it is “insufficient and ignores salient record evidence.” ICAS Petition at 34. ICAS as- serts that in addition to NO2 emissions from the Kulluk when it is an OCS source and from the Associated Fleet when it is within 25 miles of the Kulluk, the Region must also account for mobile source NO2 emissions that remain unregulated by the Permit when assessing potentially adverse health impacts of NO2 emissions on North Slope communities. Id. at 35-38. In addition, ICAS challenges the Region’s “fatal flaw of the environmental justice analysis,” namely the failure to analyze the impacts of Shell’s emissions on residents of the North Slope conducting subsis- tence activities offshore. Id. at 36-37 (emphasis in original). Finally, ICAS chal- lenges the Region’s analysis of Shell’s 1-hour NO2 NAAQS compliance based on several technical decisions the Region made. Id. at 37-38.
ICAS asserts that the Region’s environmental justice analysis is inadequate
because it does not account for emissions from mobile sources that are not in- cluded in the air quality impact analysis conducted to determine whether emis- sions from the project will cause or contribute to a violation of the NAAQS. See id. at 34 & n.30; EJ Analysis at 4. The Board disagrees.
The Region appropriately determined that it was not required to analyze
these mobile source emissions where, as here, the Title V permit did not address mobile source emissions, and the record lacked sufficient data for such an analy-
67 NAAQS are health based-standards, designed to protect public health with an adequate mar-
gin of safety, including sensitive populations such as children, the elderly, and asthmatics. See In re AES Puerto Rico, L.P., 8 E.A.D. 324, 351 (EAB 1999), aff’d sub nom. Sur Contra La Contaminación v. EPA, 202 F.3d 443 (1st Cir. 2000), cited in Shell 2010, 15 E.A.D. at 149 n.72. The Administrator is required to carry out periodic reviews of the air quality criteria published under section 108 of the CAA, 42 U.S.C. § 7408, as well as the NAAQS, and to revise the criteria and standards as appropriate. CAA § 109(d)(1), 42 U.S.C. § 7409(d)(1). The Board outlined the history of the NO2 NAAQS reviews in its December 2010 remand order. See Shell 2010, 15 E.A.D at 150 nn.73-74.
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sis.68 RTC at 114; Statement of Basis at 54; see also EJ Analysis at 2; Region Response at 36 n.34. The Region acknowledged that the Title V permit at issue in this case is unusual in that it requires a temporary Title V source to meet the NAAQS, and the permit also establishes limits on PTE. EJ Analysis at 2; State- ment of Basis at 54; RTC at 114. However, the Title V permit does not regulate mobile source emissions.69
ICAS asserts that the Board should remand the Kulluk permit so that the Region can assess
68
mobile source emissions included in Shell’s emissions inventory submitted to BOEMRE as part of Shell’s Exploration Plan, both because it “shows that the additional emissions estimates are not as hard to obtain as Region 10 implies,” and because once the Region assesses the accuracy of the inventory it can “use the information to conduct an EJ analysis that accounts for all of Shell’s emissions.” ICAS Petition at 35 (emphasis in original).
Nowhere in its petition does ICAS acknowledge the Region’s statement, in the Response to
Comments, that “[t]he Exploration Plan * * * does not include estimates of air emissions from these other vessels during the time they are more than 25 miles from the Kulluk or before the Kulluk be- comes an OCS source.” RTC at 15. The Board has consistently stated that, in order to sustain its burden of demonstrating that review is warranted, the petitioner must address the permit issuer’s re- sponses to relevant comments made during the permit proceeding. See, e.g., Peabody, 12 E.A.D. at 33 (“[T]he petitioner may not simply reiterate comments made during the public comment period, but must substantively confront the permit issuer’s subsequent explanations.”).
Furthermore, ICAS’s suggestion that the Region should “compile rough estimates” of these
mobile source emissions because “[s]ome additional steps are particularly necessary here” is similarly unavailing. ICAS Petition at 36. ICAS has acknowledged its ongoing concern regarding emissions that are not included in the PTE analysis, along with its efforts to compel Region 10 to consider non-PTE emissions as OCS source emissions in prior appeals to this Board. ICAS Petition at 34. Despite its concerns, ICAS cannot demonstrate that review is warranted where, as here, ICAS offers a generalized objection to the Region’s consideration of mobile sources in the environmental justice analysis, and the Region has demonstrated that it lacks sufficient data to reach a determinative conclusion regarding these mobile source emissions in the environmental justice context. See Avenal, 15 E.A.D. at 401-02; see also In re Cape Wind Assocs., LLC, 15 E.A.D. 327, 330 (EAB 2011) (noting that petitioners “must raise specific objections to the permit”); In re BP Cherry Point, 12 E.A.D. 209, 217 (EAB 2005) (same).
69 In a memorandum addressing environmental justice in the permitting context, the Agency
stated:
Unlike PSD/[New Source Review] permitting, Title V generally does
not impose substantive emission control requirements, but rather re-
quires all applicable requirements to be included in a Title V operating
permit. * * * Because Title V does not directly impose substantive
emissions control requirements, it is not clear whether or how EPA
could take environmental justice issues into account in Title V permit-
ting – other than to allow public participation to serve as a motivating
factor for applying closer scrutiny to a Title V permit’s compliance with
applicable CAA requirements.
Memorandum from Gary Guzy, General Counsel, U.S. EPA, to Assistant Administrators, U.S. EPA, EPA Statutory and Regulatory Authorities Under Which Environmental Justice Issues May Be Ad- dressed in Permitting 13 (Dec. 1, 2000) (A.R. FF-7).
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Despite the fact that mobile source emissions are not regulated under the
Title V permit, the Region did go beyond its required review to consider mobile source emissions with respect to environmental justice in the Response to Com- ments. See RTC at 114-15. The Region was unable to reach a determinative con- clusion with respect to these emissions due to insufficient information.
ICAS’s attempt to construe the Executive Order and Board precedent to re-
quire in this instance the analysis of emissions from mobile sources that the Re- gion may not have accurate or sufficient data to complete in the context of a Ti- tle V permit is unpersuasive. Notably, the Board has held that it will decline to review a permit issuer’s environmental justice analysis that cannot reach a deter- minative conclusion due to the insufficiency of available valid data. See RTC at 115; Avenal, 15 E.A.D. at 401-02 (stating that where a permit issuer conducts a substantive environmental justice analysis that endeavors to include and analyze data that is germane to the environmental justice issue raised during the comment period, and the permit issuer demonstrated it exercised its considered judgment when determining that it cannot reach a determinative conclusion due to the insuf- ficiency of available data, the Board will decline to grant review of the environ- mental justice analysis). Moreover, “[t]he plain language of the Executive Order imparts considerable leeway to federal agencies in determining how to comply with the spirit and letter of the Executive Order.” Avenal, 15 E.A.D. at 401. ICAS overreads Avenal when it suggests that Avenal compels the analysis of these mo- bile source emissions in the context of this permit. See ICAS Petition at 35 (“The Agency has considered mobile emissions previously in its EJ analyses and should be required to do so here.” (citing Avenal, 15 E.A.D. at 399)).70
ICAS’s challenge also fails because ICAS never responded to the Region’s
stated rationale in the administrative record that Title V permits generally do not impose new substantive air quality control requirements. A petitioner cannot sim-
70 ICAS includes a citation to Avenal for the proposition that “motor vehicle emissions are by
far the greatest concern,” in support of its contention that mobile source emissions should be included in the short-term NO2 NAAQS assessment included in the environmental justice analysis, but the quote is taken out of context and does not support ICAS’s position. See ICAS Petition at 35. The circumstances in Avenal are markedly different than those in the present case. In Avenal, the Agency conducted an environmental justice analysis that focused in particular on short-term NO2 impacts in support of a PSD permit to build a 600-megawatt power plant. 15 E.A.D. at 399. The Agency noted that in the area surrounding the proposed site for the new source, motor vehicles accounted for 91% of NO2 emissions locally, as compared to 61% of NO2 emissions nationwide. Id. In addition, the environ- mental justice analysis in Avenal noted that the area surrounding the proposed facility was designated as extreme nonattainment for ozone, and NO2 is a precursor emission. Id. Finally, the Agency further explained that NO2 concentrations on or near major roadways have appreciably higher emissions than those measured at monitors in the Agency-approved network. Id. ICAS has not demonstrated that the need to assess NO2 impacts from mobile sources in Avenal, where NO2 emissions near roadways were known to be much higher, translates into a requirement that the Agency account for these mobile emissions on the Arctic OCS to demonstrate that its environmental justice analysis is sufficient.
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ply repeat comments made during the comment period, but must substantively confront the permit issuer’s substantive explanations in order to demonstrate that review of a particular issue is warranted. Peabody, 12 E.A.D. at 33.
Further, ICAS’s assertion that the Region failed “to analyze the impacts of
Shell’s emissions on subsistence hunters and fishers while offshore,” is unsup- ported by the record. ICAS Petition at 36-37 (emphasis in original); see also Shell Discoverer 2012, 15 E.A.D. at 500. The environmental justice analysis stated that mobile source emissions will dissipate while vessels are in transit, RTC at 115, and the environmental justice analysis analyzed how the subsistence areas located in close proximity to Shell’s lease blocks might be affected by Shell’s OCS activities. EJ Analysis at 5; id. at 6 (discussing distances subsistence hunters, whalers, and fishermen have traveled offshore in search of subsistence foods); id. at 4 (depicting subsistence use areas mapped over Shell exploration plan well sites). In addition to demonstrating compliance with the applicable NAAQS, the Region conducted an environmental justice analysis that included and analyzed data that is germane to the environmental justice issues raised during the comment period. See Shell 2010, 15 E.A.D. at 160-61 n.87. Although ICAS may disagree with the contents or conclusions of the Region’s environmental justice analysis, ICAS has not demonstrated that this difference in opinion equates to an insuffi- cient effort on the Region’s part regarding environmental justice, or that the Re- gion failed to analyze impacts. See Shell Discoverer 2012, 15 E.A.D. at 500.
Finally, ICAS enumerates several problems with the Region’s environmen-
tal justice analysis that amount to challenges to the Region’s technical expertise. See ICAS Petition at 37; Region Response at 43-44; see also Shell 2012, 15 E.A.D. at 500-01. Without elaborating any further, ICAS expresses “significant concerns” with, among other things, installed NO2 controls and their ability to function properly in cold weather, the use of generic NOx/NO2 ratios in lieu of actual source tests, the use of “diurnal pairing” of NO2 data, and the need for addi- tional “tracer experiments” to supply data for the AERMOD model. ICAS Petition at 37. It is axiomatic that a challenge to the fundamental technical expertise of a permit issuer requires a petitioner to overcome a particularly heavy burden, and that a successful challenge to a permit issuer’s technical expertise must consist of more than just a difference of opinion. Shell 2012, 15 E.A.D. at 501; accord In re NE Hub Partners, L.P., 7 E.A.D. 561, 567 (EAB 1998), review denied sub nom. Penn Fuel Gas, Inc. v. EPA, 185 F.3d 862 (3rd Cir. 1999). Here, ICAS has failed to overcome this particularly heavy burden because it does nothing more than list its broad objections to the Region’s environmental justice analysis.
3. Ozone NAAQS Analysis
ICAS also challenges the Region’s compliance with its obligation under the
Executive Order based on the Region’s alleged failure to adequately address both the latest scientific findings regarding ozone and the potential impacts of ozone on
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local communities. ICAS Petition at 31. ICAS’s assertions focus in large part on the Region’s decision to demonstrate compliance with the current 8-hour ozone NAAQS, which is set at 0.75 parts per million (“ppm”), as opposed to the range of 0.60 to 0.70 ppm for the 8-hour ozone NAAQS that EPA’s Administrator pro- posed in January 2010 but never finalized. See id. at 30-34; Region Response at 40-42; RTC at 96-98, 119-20. On September 2, 2011, four days before the close of the public comment period and prior to the Region issuing the Permit, the Pres- ident requested that the Administrator withdraw the proposed 8-hour ozone NAAQS standard and instead enforce the current 8-hour ozone standard of 0.75 ppm until the ozone standard is reconsidered again in 2013. Statement on the Ozone National Ambient Air Quality Standards, 2011 Daily Comp. Pres. Doc. 607, at 1 (Sept. 2, 2011), available at http://www.gpo.gov/fdsys/ (click on Compilation of Presidential Documents). ICAS also asserts that the Region’s con- clusion not to model emissions from ozone precursors based on available back- ground data that does not account for the cumulative impacts of proposed activi- ties on the Arctic OCS was in error, and that the Region’s response to its comments regarding ozone were inadequate. ICAS Petition at 33.
The Region responds that ICAS’s petition raises issues that are largely tech-
nical, and that the Region appropriately relied on the Agency’s current legal stan- dard of 0.75 ppm when assessing Shell’s compliance with the 8-hour ozone NAAQS. Region Response at 40. The Region further asserts that it exercised its technical expertise to determine that ozone levels in the area were not expected to exceed even the lowest level of 0.60 ppm that EPA included in its proposed 8-hour ozone NAAQS. Id. at 42. Finally, the Region asserts that it appropriately responded to comments received, including comments specifically raising con- cerns about the cumulative impacts of proposed OCS operations with respect to attaining the ozone NAAQS. Id.
Although ICAS argues to the contrary, the current, enforceable 8-hour
ozone NAAQS that Shell must demonstrate compliance with is 0.75 ppm. As this Board has stated previously, “[a] permit issuer must apply the statutes and imple- menting regulations in effect at the time the final permit decision is made.” Rus- sell City II, 15 E.A.D. at 81 n.98 (quoting In re Phelps Dodge Corp., 10 E.A.D. 460, 478 n.10 (EAB 2002)). The Region’s decision to require Shell to comply with the 0.75 ppm 8-hour ozone NAAQS is consistent with applicable law and the corresponding regulations in effect at the time the Region issued the Permit.
In addition, ICAS does not demonstrate that the Region’s analysis of the
impacts the 8-hour ozone NAAQS may have on Alaska Natives residing on the North Slope would result in a disproportionately high or adverse impact on the
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health of Alaska Natives.71 In the Response to Comments supporting the Permit, the Region stated that it “stands by its decision” to forego regional photochemical modeling and further explained that “Region 10 reviewed ozone monitoring data along with existing precursor emissions that will impact ozone formation. Based on this review, Region 10 determined further analysis of ozone was not war- ranted.” RTC at 97. In addition, the Region explained that the most recent ozone data indicates that current ozone levels in the Beaufort Sea are well below 0.60 ppm, which represents the low end of the range of the proposed 8-hour ozone NAAQS.72 Id. at 97-98, 120.
Finally, ICAS’s assertion that the Region failed to consider the cumulative
impacts of emissions from proposed Arctic OCS operations is unavailing. See ICAS Petition at 33. ICAS’s petition for review not only lacks any further support for this statement, it also fails to substantively confront the Region’s explanation in the Response to Comments. See Peabody, 12 E.A.D. at 33 (petitioner must
71 ICAS’s assertion that in the context of an environmental justice analysis the Region’s treat-
ment of the 8-hour ozone standard in the current appeal is analogous to the Region’s treatment of the newly promulgated 1-hour NO2 NAAQS in Shell 2010 must also fail. See ICAS Petition at 32. As the Board recently explained, the context of the challenge to the environmental justice analysis in Shell 2010 was unusual in that the OCS PSD permits at issue were finalized in the interim between the Administrator’s publication of the final rule establishing the hourly NO2 NAAQS in the Federal Regis- ter on February 9, 2010, and the effective date of the new hourly NO2 standard, April 12, 2010. Avenal, 15 E.A.D. at 401. The Board emphasized that the environmental justice aspect of the Shell 2010 remand order turned on the Region’s scant environmental justice analysis, which provided no examination or analysis of short-term NO2 impacts whatsoever. Id.
Here, the Region not only analyzed impacts from ozone emissions, see RTC at 96-98, 119-20,
it further explained that current levels of ozone in the area are well below the low end of the range EPA had requested comment on in the proposed ozone NAAQS, and that emissions of ozone precur- sors would also not lead to an exceedance of the low range of the proposed ozone NAAQS. Id. at 120; see also Region Response at 41 n.37 (noting that the discussion of ozone in the Region’s environmen- tal justice analysis was brief, but that both the Response to Comments and the technical support docu- ment contained in the administrative record provide more detailed discussions of the Region’s determi- nation regarding ozone). Of equal importance, and unlike the events leading up to the Board’s remand order in Shell 2010, in this instance the Agency has not made a final determination or issued a final rule stating that the current 8-hour ozone standard is inadequate. See Region Response at 41. ICAS has not demonstrated that the Region’s consideration of the ozone NAAQS in the current appeal warrants Board review based on similarities to the Region’s treatment of the hourly NO2 NAAQS in Shell 2010.
72 ICAS challenges the Region’s conclusion not to model emissions of ozone and ozone pre-
cursors, and alleges that the “limited background data” that exists does not demonstrate that current ozone levels are well below the proposed ozone NAAQS. ICAS Petition at 33. ICAS does not provide any citation or reference as support for this statement, which amounts to a challenge to the Region’s technical expertise. This Board recently stated that “it is axiomatic that a challenge to the fundamental technical expertise of a permit issuer requires a petitioner to overcome a particularly heavy burden, and that a successful challenge to a permit issuer’s technical expertise must consist of more than just a difference of opinion.” Shell Discoverer 2012, 15 E.A.D. at 501 (citing Shell 2011, 15 E.A.D. at 203, and NE Hub, 7 E.A.D. at 567). ICAS’s bald assertion that background ozone data was limited and does not support the Region’s conclusions cannot overcome this particularly heavy burden.
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demonstrate why a permitting authority’s response to objections made during the public comment period warrants review). In this instance, the Region explained:
[T]he Clean Air Act permitting programs are essentially
‘first come, first served’ programs and each subsequent
permitting action needs to account for all of those that
went before but not any actions that will occur subsequent
to that action. The permits for the Discoverer drill ship in
the Chukchi Sea and Beaufort Sea are the first permits in
their respective vicinities and they only need to assess
their impacts on the existing air quality situation.
The Kulluk drill rig in the Beaufort Sea is the second per-
mit and EPA has addressed cumulative impacts by includ-
ing conditions in the permit that prevent Shell from oper-
ating the Kulluk drill rig and the Discoverer drill ship in
the Beaufort Sea during the same drilling season. Permit
Condition D.4.8. As such, only one of the two drill rigs
can operate in the Beaufort in any year so there will be no
overlapping impacts with respect to compliance with
short[]term NAAQS. * * *
As discussed above, ConocoPhillips has withdrawn its
permit application for operation of a jack-up drill rig in
the Chukchi Sea.
RTC at 101; see also EJ Analysis at 14 (reporting total maximum modeled con- centrations for criteria pollutants in Kaktovik and Nuiqsut, which account for both the Discoverer’s operation and background concentrations); Region Response at 42 n.39 (noting that “[p]otential OCS operations in the Chukchi Sea and the Beaufort Sea are over 200 miles apart at the closest point”). Aside from its plain statement that the Region did not consider the emissions from all proposed OCS operations, ICAS does not address the Region’s response to its comment, and thus cannot demonstrate that this issue warrants Board review. Peabody, 12 E.A.D. at 33.
4. Oil Spill Response Capabilities
Mr. Lum asserts that EPA has failed to require Shell to demonstrate its oil
spill response capabilities in “clear, windy, broken ice and sheet ice conditions.” Lum Petition at 1-2. The Region responds that this issue is outside the scope of these permit proceedings and thus is not properly subject to review. Region Re- sponse at 47.
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The Board has previously emphasized that “[t]he PSD review process is not
an open forum for consideration of every environmental aspect of a proposed pro- ject, or even every issue that bears on air quality.”73 In re Knauf Fiber Glass GmbH, 8 E.A.D. 121, 127 (EAB 1999) (“Knauf I”), quoted in In re Sutter Power Plant, 8 E.A.D. 680, 688 (EAB 1999); see also In re Encogen Cogeneration Fa- cility, 8 E.A.D. 244, 259-60 (EAB 1999). The Board has jurisdiction “to review issues directly related to permit conditions that implement the federal PSD pro- gram,” Sutter, 8 E.A.D. at 688, but will deny review of issues not governed by the PSD regulations because it lacks jurisdiction over them. Id.; see also Encogen, 8 E.A.D. at 259 (noting that petitioners had not shown how the issues they re- quested the Board to review fell within the Board’s PSD jurisdiction). Moreover, there are often other regulatory programs in place that may address environmental concerns that fall outside the Board’s scope of review. Knauf I, 8 E.A.D. at 162; see also Shell 2007, 13 E.A.D. at 405 n.66.
EPA’s jurisdiction over portions of the OCS applies to air emissions subject
to the CAA and its implementing regulations. In this instance, BOEMRE74 is re- sponsible for implementing regulations that address oil spill and response capabil- ities.75 The Board does not have jurisdiction to consider Shell’s oil spill and re-
73 As noted above, see Part VI.A.1.a, the OCS air regulations require that OCS permit proceed-
ings follow the procedures used to issue PSD permits contained in 40 C.F.R. part 124. 40 C.F.R.
§ 55.6(a)(3).
74 As the Board has noted in previous Shell decisions, in May 2010 the Secretary of the De-
partment of the Interior (“DOI”) signed a Secretarial Order reorganizing the former Minerals Manage- ment Service (“MMS”) into three independent entities to better carry out its three missions of: (1) im- proving the management, oversight, and accountability of activities on the OCS; (2) ensuring a fair return to the taxpayer from offshore royalty and revenue collection and disbursement activities; and (3) providing independent safety and environmental oversight and enforcement of offshore activities. Shell 2012, 15 E.A.D. at 492 n.29; see also Shell 2010, 15 E.A.D. at 112 n.7; U.S. DOI, Departmental Manual, pts. 118 & 119, ch. 1 (Sept. 30, 2011), available at http://elips.doi.gov/app_dm/dm.cfm (“De- partmental Manual”) (establishing the creation, authorities, objectives, and reporting relationships for the Bureau of Ocean Energy Management (“BOEM”) and Bureau of Safety and Environmental En- forcement (“BSEE”)). BOEMRE assumed all of MMS’s responsibilities in the interim until the full implementation of the reorganization into the three separate entities was complete. Shell 2012, 15 E.A.D. at 492 n.29; see Shell 2010, 15 E.A.D. at 112 n.7. The transfer of the revenue collection function to the Office of Natural Resources Revenue was completed on October 1, 2010. See Secretary of the Interior, U.S. DOI, Order No. 3306, Organizational Changes Under the Assistant Secretary – Policy, Management and Budget (Sept. 20, 2010), available at http://elips.doi.gov/app_SO/so.cfm; Departmental Manual, pt. 112, ch. 34 (Apr. 15, 2011). One year later, on October 1, 2011, the reorgan- ization was completed when BOEMRE was replaced by BOEM and BSEE. See Departmental Manual, pts. 118 & 119. For consistency the Board refers to BOEMRE because the Permit and the supporting documentation refer exclusively to BOEMRE.
75 On August 4, 2011, BOEMRE (now BOEM, see note 74 above) conditionally approved
Shell’s exploration plan for the Beaufort Sea. Letter from Jeff Walker, Regional Supervisor, Field Operations, Alaska OCS Region, BOEMRE, U.S. DOI, to Susan Childs, Shell Offshore, Inc. (Aug. 4,
Continued
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sponse capabilities in the Arctic OCS, and thus, the Board denies Mr. Lum’s petition for review on these grounds.
5. Impacts of Air Emissions on Traditional Subsistence Food
Sources
Mr. Lum asserts that the Kulluk’s operations in the Beaufort Sea will intro-
duce toxins into the ocean “via the exhaust [from the Kulluk] that settles down into it,” and contaminate the marine mammals and fish the coastal In~upiat con- sume as part of their indigenous diet. Lum Petition at 2-3. Mr. Lum continues that this will not only contaminate the food supply but also alter traditional In~upiat culture. Id. The Region responds that this issue is outside the scope of these per- mit proceedings and thus is not properly subject to Board review. Region Re- sponse at 47. The Board construes Mr. Lum’s assertions as a challenge to the adequacy of the Region’s compliance with the Executive Order.
Mr. Lum also raised this issue in the appeals that led to the Board’s
Shell Discoverer 2012 decision. See 15 E.A.D. at 502. In Shell Discoverer 2012, the Board denied review on procedural grounds because the impacts of air emis- sions on traditional subsistence food sources was not raised at the time of the first appeals.76 Id. In the current appeal, Mr. Lum timely submitted comments on this issue and thus his petition for review is procedurally sound. See Lum Comments at 1. The Board, however, has previously held that “[i]mpacts on subsistence hunt- ing and fishing are outside the scope of the PSD program and therefore the Board’s jurisdiction.” Shell 2007, 13 E.A.D. at 405 n.66 (citing Knauf I, 8 E.A.D. at 161-62), quoted in RTC at 125. The Board does not have jurisdiction to con- sider the impacts of air emissions on traditional subsistence food sources and In~upiat culture, and thus, the Board denies Mr. Lum’s petition for review on these grounds.
(continued)
2011) [hereinafter Beaufort EP Letter]. The approval of the Beaufort Sea exploration plan was condi- tioned, among other things, on Shell submitting to BOEMRE prior to the commencement of explora- tory drilling operations documentation regarding the subsea well capping and containment system Shell has committed to have at its disposal. Id. at 3. Specifically, Shell must “submit documentation on the procedures for deployment, installation, and operation of the system under anticipated environ- mental conditions, including the potential presence of sea ice for approval by BOEMRE. Shell will also be required to conduct a field exercise to demonstrate Shell’s ability to deploy the system.” Id.
76 As mentioned above, the Board remanded to the Region two OCS PSD permits in Decem-
ber 2010. See generally Shell 2010, 15 E.A.D. at 161-62. In the subsequent appeals of the permits issued upon completion of remand proceedings, the Board unequivocally stated that “in the current appeals, ‘[n]o new issues may be raised that could have been raised, but were not raised,’ in the previ- ous appeals.” Shell Discoverer 2012, 15 E.A.D. at 477 (quoting Shell 2010, 15 E.A.D. at 162).
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For all of the foregoing reasons, the Board declines to review the Region’s
compliance with the Executive Order and applicable Board precedent.
F. ICAS Has Failed to Demonstrate That the Region Clearly Erred or Abused Its Discretion in Providing 46 Days for Comment on the Draft Permit and in Denying ICAS’s Request for Nonoverlapping Comment Periods
ICAS claims that the Region “committed clear legal error by failing to pro-
vide the public an adequate opportunity to comment on” the draft permit.77 ICAS Petition at 6. More specifically, ICAS alleges that the Region failed to meet the parts 71 and 124 procedural requirements that require permit issuers to “allow at least 30 days for public comment” on draft permits. Id. at 7 (citing 40 C.F.R.
§§ 71.11(d)(2)(i), 124.1) (emphasis added by Petitioners). Although ICAS ac- knowledges that the comment periods for the Permit ran from July 22, 2011, to September 6, 2011, an interval of 46 days, ICAS contends that, because the Re- gion issued the draft Kulluk permit for comment at the same time it issued another draft minor source air permit for comment and in the middle of comment periods for two major source air permits for another Shell drillship,78 in reality, ICAS only “had 16 days to comment on each of the[] permits,” rather than the required mini- mum of 30. Id. at 7. This is because, according to ICAS, it “does not have the resources to comment on more than one air permit at a time.” Id. ICAS further claims that “the short and overlapping comment periods * * * deprived [them] of a meaningful opportunity to comment on Shell’s new air modeling results.” Id. at 8.
In a related argument, ICAS asserts that the Region clearly erred in denying
its request that the Region “hold nonoverlapping comment periods on the OCS permits and [] provide 45 days to comment on each permit.” Id. at 8-9. ICAS claims that it met the regulatory standard for demonstrating the need for addi- tional time to prepare comments. Id. (referring to the standard at 40 C.F.R.
§ 71.11(g)); see also id. attach. 8 (Letter from Harry Brower, Chairman, Alaska Eskimo Whaling Commission (“AEWC”), et al., to Doug Hardesty, Air Permits Project Manager, U.S. EPA Region 10 (June 15, 2011) (A.R. C-487)) (AEWC and ICAS request for nonoverlapping comment periods) [hereinafter ICAS Let-
77 The Board also considers ICAS’s claim under an abuse of discretion standard. See infra note
80.
78 The Region had issued two draft permits for Shell’s Discoverer drillship earlier in July of
- See Shell Discoverer 2012, 15 E.A.D. at 480. The comment period for those two permits ran from July 6 to August 5, 2011. Id.; ICAS Petition at 7. In addition, on the same date the Region had issued the Kulluk draft permit, it had also issued a draft permit for ConocoPhillips to operate a jackup drill rig in the Chukchi Sea. ICAS Petition at 7. The comment period for this permit originally ended at the same time as the Kulluk draft permit, but was later extended to September 21, 2011. ICAS Petition at 8-9; RTC at 7.
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ter]; id. attach. 9 (Letter from Richard Albright, Director, Office of Air, Waste, & Toxics, U.S. EPA Region 10, to Harry Brower, AEWC Chairman, et al. (July 21, 2011) (A.R. C-532)) (EPA response).
The part 71 procedural regulation governing public notices and public com-
ment periods specifically provides that “[p]ublic notice of the preparation of a draft permit * * * shall allow at least 30 days for public comment.” 40 C.F.R.
§ 71.11(d)(2)(i). The part 124 procedural regulations, which also apply to the Per- mit,79 contain the same language. See 40 C.F.R. § 124.10(b). The Board has tradi- tionally read these regulations to establish a minimum comment period length of 30 days, recognizing that the regulations clearly allow the permit issuer, in its discretion, to grant a longer comment period. Shell Discoverer 2012, 15 E.A.D. at 520-21 (discussing the applicable part 124 regulation); see also In re Genesee Power Station, 4 E.A.D. 832, 841 (EAB 1993) (noting that the part 124 regulation governing public comment periods “only require[s them] to last 30 days”). In ad- dition, as ICAS points out, part 71 contains a separate provision specifically au- thorizing a permit issuer to grant additional time. It states that “[a] comment pe- riod longer than 30 days may be necessary to give commenters a reasonable opportunity to comply with the requirements of this section. Additional time shall be granted to the extent that a commenter who requests additional time demon- strates the need for such time.”80 40 C.F.R. § 71.11(g)).
79 As the Region explained, the Permit is subject to the procedural requirements of both
part 55 (and consequently part 124) as well as part 71:
The portion of this permit that is a Part 71 permit (e.g., the portion of the
permit that applies on the Outer OCS) is issued under 40 CFR Part 55
and 40 CFR Part 71 and subject to the procedural requirements of
40 CFR Part 71 as provided in 40 CFR § 71.4(d). The portion of this
permit that is a COA Title V permit and a COA minor source permit
(e.g., the portion of the permit that applies on the Inner OCS) is issued
under 40 CFR Part 55 and, in the absence of other applicable proce-
dures, subject to the permit issuance procedures for PSD permits under
40 CFR Part 124, Subpart A and C. See 40 CFR §§ 55.6(a) (3) and
124.1.
RTC at 6 n.3.
80 Because the regulations authorize the permit issuer to grant a longer comment period upon
an adequate showing of need, the Board also considers ICAS’s challenge under an abuse of discretion even though ICAS did not clearly present its challenge as such, alleging instead only “clear error.” See Shell Discoverer 2012, 15 E.A.D. at 521 (considering similar argument as raising an abuse of discretion claim); In re Guam Waterworks Auth., 15 E.A.D. 437, 443 n.7 (EAB 2011) (explaining Board’s standard in reviewing claims involving a permit issuer’s exercise of discretion); In re Desert Rock Energy Co., 14 E.A.D. 484, 530 (EAB 2009) (using an abuse of discretion standard where the permit issuer had “broad discretion” in making the challenged determination). The Board similarly reads ICAS’s challenge to the Region’s denial of nonoverlapping comment periods as raising an abuse of discretion claim.
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In the present case, the Region provided a 46 day public comment period
for the Kulluk draft permit, albeit a comment period that partially overlapped with several other comment periods. The Region, in its Response to Comments, pro- vided a lengthy, well-reasoned explanation for its establishment of a 46 day com- ment period for the Kulluk permit and for its denial of ICAS’s request for noncon- current comment periods. See RTC at 5-8. In addressing comments on these topics, the Region pointed out that it had granted a period longer than the regula- tory minimum for this permit and had also extended the comment period for one of the other permits, the ConocoPhillips permit. Id. at 6; accord id. at 7. The Region further noted that the ConocoPhillips permit, for which it had extended the comment period to 60 days, was for a proposed 2013 operation, whereas Shell “intends to begin its exploratory drill operations with the Kulluk in July 2012.” Id. at 7. The Region also enumerated the many steps it had taken before and during the public comment period “to promote meaningful public involvement.” Id. at 6.
In addition, the Region observed that, while “it agree[d] with the com-
menters that some aspects of the Draft Permit are technically and legally com- plex,” on the other hand, “[t]he comments submitted * * * demonstrate[d] that the public was able to review, evaluate, and comment on many complex issues during the comment period provided.” RTC at 8. The Region noted that among the more than 14,500 public comments it had received, a number of them had contained “substantive comments on, among other issues, the definition of OCS Source, limits on the source’s potential to emit, choice of model, modeling data, ambient air boundary, source testing, emission factors, air quality analysis, appli- cability of increments and visibility, and cumulative impacts.” Id. Accordingly, the Region believed that “[t]he volume of comments received and the substantive issues addressing technically and legally complex issues demonstrate[d] that the public was able to meaningfully review and comment on the Draft Permit.” Id.
The Region also explained that “40 CFR § 71.7(a)(2) requires that it take a
final action on a Title V permit application within 18 months of receiving a com- plete application. In conducting the permitting process, Region 10 must strike a balance between its obligation to provide for meaningful public participation and its responsibility to make a final permitting decision in a timely manner.” Id. Based on all these factors, the Region had determined that “the commenters have not demonstrated that a period of more than 46 days is necessary to give the pub- lic a reasonable opportunity to comment.” Id. at 7 (citing 40 C.F.R. §§ 71.11(g) and 124.13).
In its petition, ICAS does not explain why the Region’s response to these
comments is clearly erroneous or an abuse of discretion. In fact, ICAS does not even address the Region’s response. ICAS’s failure to address the Region’s re- sponse is, in and of itself, sufficient to deny its claims of procedural error con-
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cerning the comment period.81
Nevertheless, even if the Board considered ICAS’s claim of procedural er-
ror, the Board would deny review of this claim for several reasons. First, the length of time the Region provided for comment on this permit – 46 days – is 16 days more than the regulatory minimum required by 40 C.F.R.
§§ 71.11(d)(2)(i) and 124.10(b). It is also one day more than the amount of time ICAS had specifically requested for each permit in its letter.82 See ICAS Letter at 2 (requesting nonconcurrent comment periods of 45 days). ICAS’s attempt to recalculate the length of the comment period as “16 days” based on an unex- plained mathematical formula involving the number and lengths of other com- ment periods is unconvincing and does not demonstrate clear error. See Shell Dis- coverer 2012, 15 E.A.D. at 521; see also Russell City II, 15 E.A.D. at 95-98 (denying review of a procedural error claim where petitioners fail to point to a part 124 procedural regulation that was violated); Knauf II, 9 E.A.D. at 17 (deny- ing review where the permit issuer fulfilled the applicable regulatory obligations, but did not go beyond those requirements).
Furthermore, while it is true that the Region did not grant ICAS’s request
for nonoverlapping comment periods, ICAS has not pointed to any regulations that prohibit the Agency from issuing concurrent permits or that require – or even specify – a different comment period length when the Agency does issue concur- rent permits. To the contrary, the relevant regulations authorize the Agency to issue a single public notice to “describe more than one permit or permit actions,” 40 C.F.R. §§ 71.11(d)(1)(iii), 124.10 (a)(3), without mentioning a different time frame for public comment when concurrent permits are issued. While sec- tion 71.11(g) authorizes the Agency to extend a particular comment period on a case-by-case basis where a commenter has demonstrated the need for additional time – which would thereby provide an avenue for commenters to obtain longer comment periods in situations where comment periods overlap83 – the provision does not prohibit, or even mention, overlapping comment periods.
81 As the Board discussed above in Part III, a petitioner must explain why the permit issuer’s
previous response to those objections is clearly erroneous or otherwise warrants review. “[A] peti- tioner’s failure to address the permit issuer’s response is fatal to its request for review.” In re In- deck-Elwood LLC, 13 E.A.D. 126, 143, 170 (EAB 2006); accord Russell City II, 15 E.A.D. at 10.
82 Notably, therefore, for this permit, by providing a longer comment period, the Region did in
essence partially grant ICAS’s request.
83 And, in this case, the Region did, provide additional time for comment on two of the permits
whose comment period overlapped. The Region increased the comment period for the Shell Kulluk permit to 46 days and the comment period for the ConocoPhillips permit to 60 days. See supra note 78.
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Finally, it is clear from the administrative record that the Region appropri-
ately balanced conflicting considerations in deciding on the length of the com- ment period for this permit and in denying the request for nonoverlapping periods. ICAS has not demonstrated otherwise84 and has therefore failed to show that the Region clearly erred or abused its discretion in either selecting a 46 day comment period or in denying ICAS’s request for nonconcurrent comment periods. See Shell Discoverer 2012, 15 E.A.D. at 523 (denying review of a similar claim based on similar facts). Review of the Permit is therefore denied on this issue.
G. ICAS Has Failed to Demonstrate That the Region Clearly Erred in Its Public Hearing Procedures or That Any of the Alleged Procedural Deficiencies Otherwise Warrant Review
As noted above in Part V, the Region held two public hearings on the draft
permit, one in Barrow, and a second in Anchorage. The Region also held an infor- mational meeting prior to the Barrow public hearing. See Statement of Basis at 11 (scheduling informational hearing from 5:00-6:30 pm, public hearing from 7:00-9:00 pm); RTC at 6-7.
ICAS claims that the Region “committed clear legal error by failing to pro-
vide the public an adequate opportunity” to participate in the Barrow public hear- ing. ICAS Petition at 6; see also id. at 9-10. ICAS alleges three procedural problems with the Barrow hearing. Id. at 9-10. ICAS first claims that the Region continued with the hearing despite difficulties with the teleconference phone sys- tem that allegedly impaired the ability of the Region to hear all comments. Id. at 9. ICAS next alleges that, “for a significant portion of the hearing,” the Region discussed a PowerPoint presentation that was not made available to the public attending the hearing. Id. at 9-10. Finally, ICAS contends that the Region failed to sufficiently inform those attending the public hearing that it had procured an
84 The Board is unpersuaded by ICAS’s argument that it had difficulty locating an expert to
review the air modeling. See ICAS Petition at 8. As the Region indicated in its Response to Com- ments, RTC at 8, other commenters provided substantive, technical comments on the air modeling, which suggests that the comment period was sufficient to allow opportunity for meaningful comment. See Fla. Power & Light Co. v. United States, 846 F.2d 765, 772 (D.C. Cir. 1988) (upholding a short comment period as sufficient where the agency had received numerous comments, some lengthy, and the comments had had a “measurable impact” on the final rule); Conference of State Bank Supervisors v. Office of Thrift Supervision, 792 F. Supp. 837, 844 (D.D.C. 1992) (holding length of comment period not unreasonable especially in light of the comments that plaintiffs and other parties submitted). Furthermore, as the Region points out, it notified ICAS in May that the comment periods would begin in July. See Letter from Doug Hardesty, EPA, to North Slope Borough et al. (May 25, 2011) (A.R. HH-1). The Region also conducted three separate informational meetings in Barrow and Kaktovik, Alaska, more than a month prior to the start of the public comment period for the Permit “to inform the North Slope community of the draft permit and to describe opportunities for public participation.” RTC at 6.
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In~upiat interpreter for the hearing.85 Id. at 10. ICAS asserts that making an inter- preter “available in this fashion is akin to not having [one] at all.” Id.
Part 71 and part 124 each contain a provision governing public hearings.
See 40 C.F.R. §§ 71.11(f), 124.12. Both public hearing regulations require the permitting authority to hold a public hearing when the permitting authority “finds, on the basis of requests, a significant degree of public interest in a draft permit.” Id. §§ 71.11(f)(1), 124.12(a)(1). The regulations also authorize the permitting au- thority to hold a public hearing “at its discretion, whenever, for instance, such a hearing might clarify one or more issues involved in the permit decision.” Id.
§§ 71.11(f)(2), 124.12(a)(2); accord In re Russell City Energy Ctr. (“Russell City I”), 14 E.A.D. 159, 164 n.6 (EAB 2008). The public hearing regulations also prescribe the method of giving public notice of the hearing, 40 C.F.R.
§§ 71.11(f)(3), 124.12 (a)(4), the procedure for designating a presiding officer to preside at the hearing, id. §§ 71.11(f)(4), 124.12 (b), and the procedures for the public to comment at the hearing, id. §§ 71.11(f)(5), 124.12 (c). Finally, both reg- ulations require that a tape recording or written transcript of the hearing be made publically available. Id. §§ 71.11(f)(6), 124.12 (d).
Parts 71 and 124 also both require the permit issuer, in making its final
decision, to consider all comments it receives during the public comment period and at any public hearings and to issue a “response to comments.” Id. §§ 71.11(j), 124.17(a); see also id. §§ 71.11(e), 124.11. More particularly, these provisions require the permit issuer to “[b]riefly describe and respond to all significant com- ments on the draft permit * * * raised during the public comment period, or dur- ing any hearing” in the response to comments document issued at the same time the final permit decision is issued. Id. §§ 77.11(j)(1)(ii), 124.17(a)(1). Impor- tantly, none of the aforementioned regulations refer to, or in any way mention, a requirement to provide an interpreter or a requirement to provide written materials at the hearing.
Upon review of the administrative record and the parties’ arguments, the
Board concludes that ICAS has not shown that the Region clearly erred in its handling of the Barrow public hearing for any of the three reasons ICAS ad- vances. Not only does ICAS fail to point to any specific regulatory provision that the Region violated, but none of the alleged problems otherwise warrant Board review. The Board addresses each alleged deficiency in more detail below.
ICAS’s first contention – that the Region committed clear error because it
was allegedly unable to adequately obtain input from the public due to telecom-
85 According to ICAS, although the Region may have noted that an interpreter was available at
the top of the hearing’s sign-in sheet, it did not make a public announcement of this fact at the outset of the hearing. ICAS Petition at 10; ICAS Reply at 6; see also infra note 89.
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munication problems during the hearing – is unpersuasive. The Region addressed this concern in its Response to Comments. See RTC at 9. There, the Region ex- plained that, because such telecommunication problems are common on the North Slope, it had “recorded the public hearing in addition to having the hearing tran- scribed by a court reporter. From these two sources, Region 10 was able to cap- ture the comments provided during the public hearing.” Id. (emphasis added); see also Public Hearing Transcript (“Pub. Hrg Tr.”) at 3 (explaining that the hearing was recorded on the teleconference line as a “safety net”). In response, ICAS merely asserts that “this does not change the fact that people were not able to be heard via phone.” ICAS Petition at 9. Significantly, however, ICAS does not iden- tify any comment that the Region failed to hear or for which the Region failed to provide a response.86 See id. at 9; ICAS Reply at 6. Nor has any commenter come forward alleging that the Region failed to respond to his or her public hearing comments. The fact that the call center experienced some telecommunications problems during the public hearing – which the Region appears to have ade- quately anticipated and addressed by utilizing two methods of note taking – does not, without more, constitute clear legal error. Speculative claims that a permitting authority may have failed to hear a comment are insufficient to warrant Board review.
ICAS’s contention that the Region committed clear procedural error by fail-
ing to provide pre-meeting copies of a Powerpoint presentation is inapposite. In its response to the petition, the Region explains that this presentation was given during the informational meeting, not during the public hearing. Region Response at 39; see also Statement of Basis at 11 (scheduling informational hearing prior to public hearing); RTC at 6-7 (mentioning informational meeting). ICAS does not dispute this.87 See ICAS Reply at 5-7. Furthermore, nowhere do the regulations require a permitting authority to provide informational handouts at an informa- tional meeting (or at a public hearing).88 Thus, while it may be useful for a permit
86 As discussed above, the regulatory requirement is for a permit issuer to respond to signifi-
cant comments. See 40 C.F.R. § 77.11(j)(1)(ii), 124.17(a)(1). Thus, had ICAS identified significant comments raised at the public hearing that the Region failed to address, ICAS’s arguments would have been more persuasive. See, e.g., In re Rockgen Energy Ctr., 8 E.A.D. 536, 557 (EAB 1999) (remand- ing so that permit issuer could demonstrate it had given thoughtful and full consideration to public comments); In re W. Suburban Recycling & Energy Ctr., L.P., 6 E.A.D. 692, 710-12 (EAB 1996) (remanding permit and requiring permit issuer to comply with procedures under part 124 including provision requiring a response to all significant comments received); see also In re N. Mich. Univ., 14 E.A.D. 283, 317-18 (EAB 2009) (discussing part 124 requirement to adequately respond to comments).
87 The Region’s explanation makes sense in light of the purpose of the two meetings. While the
permitting authority may present its analyses, findings, and conclusions about the draft permit at an informational meeting, the purpose of the public hearing is to obtain comments from the public.
88 The only document the public hearing regulations require a permit issuer make available to
the public is the transcript of the hearing. 40 C.F.R. §§ 71.11(f)(6), 124.12 (d).
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issuer to provide copies of a presentation to the audience attending an informa- tional meeting, failure to do so at the meeting – or at a subsequent public hearing
– does not constitute clear error or otherwise warrant Board review.
ICAS’s final contention – that the Region committed clear procedural error
by not adequately informing the public that an interpreter was available at the public hearing – is also unconvincing. Importantly, as noted above, there is no regulatory requirement for an interpreter in either part 71 or part 124, nor is there a provision specifying the method a permit issuer should use to inform the public of the availability of an interpreter at the public hearing.89 ICAS has not pointed to any other requirement, regulatory or otherwise, requiring an interpreter or pre- scribing the method for announcing one. Accordingly, while it may be preferable for the permit issuer to formally announce the availability of an interpreter at the beginning of the public hearing, and in both languages, failure to do so does not constitute clear error or otherwise warrant Board review.
In sum, ICAS has failed to demonstrate that the public hearing procedures
utilized by the Region constituted clear error. ICAS has not shown that the Region violated any part 71 or 124 procedural regulation. Moreover, the alleged problems ICAS has identified do not, even if the Board were to find them to constitute a deficiency in some way, warrant Board review. Consequently, the Board denies review of the Permit on this ground.
VII. CONCLUSION AND ORDER
For the foregoing reasons, the Board concludes that none of the petitioners
have demonstrated that review of Permit No. R10 OCS030000 is warranted on any of the grounds presented. The Board therefore denies review of the Permit.
So ordered.
89 The parties seemingly dispute the method in which the Region notified the public of the
availability of the interpreter. The Region stated in its Response to Comments that, “[p]rior to the Barrow public hearing, Region 10 contacted [ICAS] to arrange for an In~upiat speaker to be available to provide In~upiat interpretation at the hearing if requested by any participant. At the beginning of the hearing, participants were provided the opportunity to request In~upiat interpretation during the hear- ing. No participant requested translation and therefore an interpreter was not used.” RTC at 10-11. In response, ICAS claims that attendees only recall mention of an interpreter on the sign-up sheet, and only in English. ICAS Petition at 10. ICAS further asserts that the transcript of the public hearing does not indicate that an announcement was made. ICAS Reply at 6. In light of the Board’s conclusion on this issue, it is unnecessary to determine the precise methodology the Region used to notify the public of the interpreter’s availability.
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