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Friends of Buckingham v. State Air Pollution Control Board

United States Court of Appeals, Fourth Circuit

January 7, 2020

FRIENDS OF BUCKINGHAM; CHESAPEAKE BAY FOUNDATION, INCORPORATED, Petitioners,
v.
STATE AIR POLLUTION CONTROL BOARD; RICHARD D. LANGFORD, Chair of the State Air Pollution Control Board; VIRGINIA DEPARTMENT OF ENVIRONMENTAL QUALITY; DAVID K. PAYLOR, Director, Virginia Department of Environmental Quality, Respondents, ATLANTIC COAST PIPELINE LLC, Intervenor. LAWYERS' COMMITTEE FOR CIVIL RIGHTS UNDER LAW; DELEGATE DAWN ADAMS; DELEGATE LASHRECSE AIRD; DELEGATE HALA ALAYA; DELEGATE JOHN BELL; SENATOR JENNIFER BOYSKO; DELEGATE JENNIFER CARROLL FOY; DELEGATE LEE CARTER; DELEGATE KELLY CONVIRS-FOWLER; SENATOR CREIGH DEEDS; DELEGATE KARRIE DELANEY; DELEGATE WENDY GOODITIS; DELEGATE ELIZABETH GUZMAN; DELEGATE PATRICK ALAN HOPE; DELEGATE CHRIS HURST; DELEGATE JAY JONES; DELEGATE MARK KEAM; DELEGATE KAYE KORY; DELEGATE PAUL KRIZEK; DELEGATE MARK LEVINE; DELEGATE ALFONSO LOPEZ; DELEGATE KENNETH R. PLUM; DELEGATE SAM RASOUL; DELEGATE MARCUS SIMON; DELEGATE KATHY TRAN; DELEGATE CHERYL TURPIN; DELEGATE DEBRA RODMAN; DELEGATE IBRAHEEM SAMIRAH; DELEGATE LIONELL SPRUILL; VIRGINIA CONFERENCE NAACP; THE CENTER FOR EARTH ETHICS; VIRGINIA STATE CONFERENCE OF NAACP BRANCHES; UNION GROVE MISSIONARY BAPTIST CHURCH; SIERRA CLUB; VIRGINIA INTERFAITH POWER AND LIGHT; KAIROS CENTER FOR RELIGIONS, RIGHTS, AND SOCIAL JUSTICE, Amici Supporting Petitioners. JOSEPH SCRUGGS; GERALD WASHINGTON; CRAIG WHITE, Amici Supporting Respondents/Intervenor.

          Argued: October 29, 2019

          On Petition for Review of a Decision of the State Air Pollution Control Board and the Virginia Department of Environmental Quality. (Permit No. 21599)

         ARGUED:

          David L. Neal, SOUTHERN ENVIRONMENTAL LAW CENTER, Chapel Hill, North Carolina; Jon Alan Mueller, CHESAPEAKE BAY FOUNDATION, INC., Annapolis, Maryland, for Petitioners.

          Martine Elizabeth Cicconi, OFFICE OF THE ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for Respondents. Elbert Lin, HUNTON ANDREWS KURTH LLP, Richmond, Virginia, for Intervenor.

         ON BRIEF:

          Gregory Buppert, Charmayne G. Staloff, SOUTHERN ENVIRONMENTAL LAW CENTER, Charlottesville, Virginia, for Petitioner Friends of Buckingham. Margaret L. Sanner, CHESAPEAKE BAY FOUNDATION, INC., Annapolis, Maryland, for Petitioner Chesapeake Bay Foundation, Inc. Mark R. Herring, Attorney General, Donald D. Anderson, Deputy Attorney General, Paul Kugelman, Senior Assistant Attorney General, Toby J. Heytens, Solicitor General, Michelle S. Kallen, Deputy Solicitor General, Brittany M. Jones, John Marshall Fellow, OFFICE OF THE ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for Respondents.

          Harry M. Johnson, III, Timothy L. McHugh, Aaron C. Alderman, Richmond, Virginia, Stuart A. Raphael, HUNTON ANDREWS KURTH LLP, Washington, D.C., for Intervenor Atlantic Coast Pipeline, LLC. Kristen Clarke, Jon Greenbaum, Dorian L. Spence, Maryum Jordan, LAWYERS' COMMITTEE FOR CIVIL RIGHTS UNDER LAW, Washington, D.C., for Amicus Lawyers' Committee for Civil Rights Under Law. Elizabeth F. Benson, SIERRA CLUB, Oakland, California, for Amici Virginia State Conference NAACP, Union Grove Missionary Baptist Church, Sierra Club, Virginia Interfaith Power & Light, and Kairos Center for Religions, Rights, and Social Justice. Aderson B. Francois, Taylor Blatz, Civil Rights Clinic, GEORGETOWN UNIVERSITY LAW CENTER, Washington, D.C., for Amici 28 Members of the Virginia General Assembly, Virginia State Conference NAACP, and the Center for Earth Ethics. Andrew P. Sherrod, Jaime B. Wisegarver, HIRSCHLER FLEISCHER, P.C., Richmond, Virginia, for Amici Joseph Scruggs, Gerald Washington, and Craig White.

          Before GREGORY, Chief Judge, and WYNN and THACKER, Circuit Judges.

          THACKER, CIRCUIT JUDGE:

         Friends of Buckingham and the Chesapeake Bay Foundation, Inc. (collectively, "Petitioners") challenge the Virginia Air Pollution Control Board ("Board")'s award of a permit for construction of a compressor station on behalf of Intervenor Atlantic Coast Pipeline, LLC ("ACP") in the historic community of Union Hill in Buckingham County, Virginia (the "Compressor Station"). The Compressor Station is one of three such stations planned to support the transmission of natural gas through the ACP's 600-mile pipeline (the "Pipeline"), which is projected to stretch from West Virginia to North Carolina.

         Petitioners filed this petition for review against the Board and its chairman, and the Virginia Department of Environmental Quality ("DEQ") and its director (collectively, "Respondents"), raising two assignments of error. First, Petitioners contend the Board erred in failing to consider electric turbines as zero-emission alternatives to gas-fired turbines in the Compressor Station. Second, they contend the Board erred in failing to assess the Compressor Station's potential for disproportionate health impacts on the predominantly African-American community of Union Hill, and in failing to independently evaluate the suitability of that site.

         As explained below, we agree with Petitioners and vacate and remand to the Board.

         I.

         A.

         Legal Background

         This petition for review is governed by a complex intertwining of local, state, and federal laws and regulations. Therefore, we first set forth the law at play before turning to the facts at hand. 1.

         The Clean Air Act

         a.

         National Air Quality Standards

         Pursuant to the Clean Air Act ("CAA"), 42 U.S.C. §§ 7401-7671q, the Environmental Protection Agency ("EPA") is tasked with establishing national ambient[1] air quality standards ("NAAQS") for certain "criteria" pollutants. 42 U.S.C. § 7409. Criteria pollutants are pollutants which EPA has determined may endanger the public health or welfare, and they include: sulfur dioxide, carbon monoxide, nitrogen dioxide (referred to herein as "NOx"), ozone, particulate matter, and lead. See generally 40 C.F.R. Part 50.

         There are both primary and secondary NAAQS. The primary NAAQS for a given pollutant are the acceptable concentrations of pollutants in the ambient air required to "protect the public health," allowing an "adequate margin for safety." 42 U.S.C. § 7409(b)(1). The secondary NAAQS are the levels set to "protect the public welfare," including environmental and economic interests such as "soils, water, crops," "manmade materials," "visibility," and "climate," in addition to "effects on economic values and on personal comfort." Id. § 7409(b)(2), 7602(h).

         Once set by the EPA, the NAAQS are then implemented by nationwide limitations on mobile sources like vehicles, and on new or modified stationary sources; and, relevant here, by state implementation plans ("SIP"s), which implement the NAAQS through emission limitations on stationary and mobile sources. See 42 U.S.C. §§ 7409-10.

         There are two types of stationary sources: major emitting sources and minor emitting sources. A major source is one that has the "potential to emit two hundred and fifty tons per year or more of any air pollutant," and a minor source is one that falls below that benchmark. 42 U.S.C. § 7479(1). The Compressor Station is indisputably a minor source, as it has the potential to emit 43 tons per year.

         b.

         Best Available Control Technology ("BACT")

         The CAA also requires major source facilities (but not minor ones) to be subject to "the best available control technology [BACT] for each pollutant subject to regulation under this chapter emitted from, or which results from, such facility." 42 U.S.C. § 7475(a)(4). BACT is a guarantee that the emitting source is using the best available technology to limit emissions of regulated pollutants. It is defined in the CAA as:

an emission limitation based on the maximum degree of reduction of each [regulated] pollutant . . . emitted from or which results from any major emitting facility, which the permitting authority, on a case-by-case basis, taking into account energy, environmental, and economic impacts and other costs, determines is achievable for such facility through application of production processes and available methods, systems, and techniques, including fuel cleaning, clean fuels, or treatment or innovative fuel combustion techniques for control of each such pollutant.

42 U.S.C. § 7479(3).

         c.

         "Redefining the Source"

         Control technologies "are those technologies that have 'a practical potential for application to the emissions unit and the regulated pollutant under evaluation.'" Helping Hand Tools v. U.S. Envtl. Prot. Agency, 848 F.3d 1185, 1190 (9th Cir. 2016) (quoting EPA, New Source Review Workshop Manual, at B.5 (1990)). Generally, under federal law the failure to consider available alternative control technologies (also referred to as "control alternatives") in BACT analysis "constitutes clear error." Id. at 1194. However, the EPA "does not have to consider [a] control alternative[]" -- even if it is effective at reducing emissions -- if it "redefines the source." Id. "[A] control alternative redefines the source if it requires a complete redesign of the facility. In a classic and simple example, a coal-burning power plant need not consider a nuclear fuel option as a 'cleaner' fuel because it would require a complete redesign of the coal-burning power-plant." Id.

         "Redefining the source" in the federal administrative world is applicable to projects certified under the prevention of significant deterioration ("PSD") program. The PSD provisions were added to the CAA in 1977 to focus on "facilities which, due to their size, are financially able to bear . . . substantial regulatory costs . . . and which, as a group, are primarily responsible for emissions of the deleterious pollutants that befoul our nation's air." Ala. Power Co. v. Costle, 636 F.2d 323, 353 (D.C. Cir. 1980). The purpose of the PSD program is to "protect public health and welfare from any actual or potential adverse effect which in [EPA's] judgment may reasonably be anticipate[d] to occur from air pollution . . . notwithstanding attainment and maintenance of all [NAAQS]." 42 U.S.C. § 7470(1). The PSD program was designed to "combat incumbency by ensuring that, in addition to new facilities, existing facilities will eventually have to satisfy stringent technology-based requirements when they make major modifications." Sage Ertman, Climate Change and the PSD Program: Using BACT to Combat the Incumbency of Fossil Fuels, 47 Envtl. L. 995, 1006 (2017).

         The "redefining the source" doctrine was developed by the EPA to resolve an ambiguity in the CAA. Specifically, some hearing officers and courts had recognized the "tension between" two CAA requirements in the PSD program. In re Prairie State Generating Co., 13 E.A.D. 1, 2006 WL 2847225, at *16 n.15 (Aug. 24, 2006), aff'd sub nom. Sierra Club v. Envtl. Prot. Agency, 499 F.3d 653 (7th Cir. 2007) (citing § 7475(a)(1)). First, there is an "obligation to conduct the BACT analysis on the 'proposed facility.'" Id. Second, there is a "concurrent obligation to consider as BACT 'application of production processes and available methods, systems, and techniques,' including lower-emitting fuels." Id. (citing § 7479(3)). According to the EPA's Office of Air and Radiation, the redefining the source doctrine "reasonably harmonizes" these competing obligations in that the entity issuing the permit "review[s] the project as proposed -- not something fundamentally different," but also "review[s] all elements of the proposed project's design and, in particular, consider[s] whether lower emissions are achievable through application of production processes and available methods, systems, and techniques." Id. at *16 (internal quotation marks omitted).

         The EPA has clarified that, under the redefining the source doctrine, BACT review depends on a company's proposed plans and purpose. Thus, for the PSD program, a permitting agency must consider all means of lowering emissions, as long as those means would not "regulate the applicant's objective or purpose for the proposed facility" or require a redesign of a proposed facility. Helping Hand, 848 F.3d at 1195; see also Sierra Club, 499 F.3d at 654 ("EPA's position is that [BACT] does not include redesigning the plant proposed by the permit applicant" (citing EPA, New Source Review Workshop Manual: Prevention of Significant Deterioration and Nonattainment Area Permitting B.13 (1990))); John-Mark Stensvaag, Preventing Significant Deterioration Under the Clean Air Act: The BACT Determination - Part I, 41 Envtl. L. Rep. News & Analysis 11101, 11112 (2011) ("EPA will not insist on a BACT technology that would redefine the permit applicant's facility."). For example, "[w]hen a fuel source is co-located with a facility, EPA need not consider in the BACT analysis fuel sources that are not readily available, because it would redefine the source." Helping Hand, 848 F.3d at 1195. Therefore, in the context of major source PSD permits, the EPA does not have to consider control alternatives that would "redefine the source" in a given project.

         To our knowledge, this federal redefining the source doctrine has never been applied to a non-PSD, minor source by a state pollution board, which is what we have here.[2]

         2.

         Virginia Law

         a.

         Virginia's State Implementation Plan

         The CAA "establishes a program of cooperative federalism that allows the [s]tates, within limits established by federal minimum standards, to enact and administer their own regulatory programs, structured to meet their own particular needs." Virginia v. Browner, 80 F.3d 869, 883 (4th Cir. 1996) (internal quotation marks omitted). The federal NAAQS are merely "[pollutant] concentration ceilings," In re Prairie, 2006 WL 2847225, at *5, that "allow[] an adequate margin of safety," 42 U.S.C. § 7409(b)(1), and "protect not only average healthy individuals, but also 'sensitive citizens' -- children, for example, or people with asthma, emphysema, or other conditions rendering them particularly vulnerable to air pollution," North Carolina v. TVA, 615 F.3d 291, 310 (4th Cir. 2010) (internal quotation marks omitted). However, the CAA makes clear that "air pollution control at its source is the primary responsibility of States and local governments." 42 U.S.C. § 7401(a)(3). Therefore, states are tasked with adopting a SIP "which provides for implementation, maintenance, and enforcement of [primary and secondary NAAQS] in each air quality control region (or portion thereof) within such State." Id. § 7410(a)(1).

         Virginia's SIP is set forth predominantly in Title 9 of the Virginia Administrative Code. New minor stationary sources with emissions above a certain level must receive an air permit issued pursuant to Article 6 of Chapter 80 of the Virginia Administrative Code ("Permit" or "Article 6 Permit") by DEQ or the Board. See 9 Va. Admin. Code § 5-80-1120(A). ACP applied for an Article 6 Permit on September 17, 2015. DEQ took ACP's application and elevated it to the Board for approval.

         Pursuant to Virginia's SIP, all new stationary sources, whether major or minor, are subject to BACT review. See 9 Va. Admin. Code § 5-50-260(B) ("A new stationary source shall apply best available control technology for each regulated pollutant for which there would be an uncontrolled emission rate equal to or greater than the levels in 9 Va. Admin. Code § 5-80-1105 [providing charts of exemption levels in tons per year for various pollutants]."). This is so even though federal law does not require a BACT analysis of minor sources.

         Virginia's BACT relies on emission reduction per emissions unit via production processes, methods, or techniques. See 9 Va. Admin. Code § 5-50-260(C) ("This [BACT] requirement applies to each affected emissions unit in the project." (emphasis supplied)). Specifically, Virginia's BACT analysis requires the development of "an emissions limitation . . . based on the maximum degree of emission reduction . . . which the [B]oard, on a case-by-case basis, . . . determines is achievable for the new stationary source . . . through the application of production processes or available methods, systems and techniques, including fuel cleaning or treatment or innovative fuel combustion techniques." Id. § 5-50-250(C). Of note, there is no reference to the "redefining the source" doctrine in Virginia law or regulations.

         b.

         The Commonwealth Energy Policy

         In addition to the SIP, Virginia law also contains a Commonwealth Energy Policy, which "[e]nsure[s] that development of new, or expansion of existing, energy resources or facilities does not have a disproportionate adverse impact on economically disadvantaged or minority communities." Va. Code Ann. § 67-102(A)(11). Likewise, one of the "[e]nergy objectives" of the Commonwealth Energy Policy is to "[d]evelop[] energy resources and facilities in a manner that does not impose a disproportionate adverse impact on economically disadvantaged or minority communities." Id. § 67-101(12).

         c. Virginia's Regulatory Structure

         The Board is a seven-member citizen board selected by the Governor "from the Commonwealth at large on the basis of merit without regard to political affiliation." Va. Code Ann. § 10.1-1302; see id. § 10.1-1301. The Board is empowered to "make, or cause to be made, such investigations and inspections and do such other things as are reasonably necessary" to discharge its duties. Id. § 10.1-1306. For example, the Board may "call upon any state department or agency for technical assistance" in performing its duties. Id. § 10.1-1303.

         The Board often calls upon DEQ to provide technical support and help the Board to fulfill its obligations. In general, DEQ can review permit applications, prepare draft permits and related documents, review and respond to comments from the public, and hold public hearings. See Aegis Waste Sols., Inc. v. Concerned Taxpayers of Brunswick Cty., 544 S.E.2d 660, 663 (Va. 2001); see generally 9 Va. Admin. Code § 5-170-180 (delegating Board's administrative functions to DEQ). Either the Board or DEQ can issue minor source Article 6 Permits, but when the Board does so, as in this case, it must consider:

(i) the verbal and written comments received during the public comment period made part of the record, (ii) any explanation of comments previously received during the public comment period made at the Board meeting, (iii) the comments and recommendation of [DEQ], and (iv) the agency files.

Va. Code Ann. § 10.1-1322.01(P). If the Board adopts the recommendation of DEQ, it "shall provide in writing a clear and concise statement of the legal basis and justification for the decision reached." Va. Code Ann. § 10.1-1322.01(P). Likewise, if the Board's decision varies from DEQ's recommendation, the Board must "provide a clear and concise statement explaining the reason for the variation and how the Board's decision is in compliance with applicable laws and regulations." Id.

         3.

         Local Permitting

         Finally, before ACP can construct a compressor station in Buckingham County, it is required to obtain a separate special use permit ("SUP") from the Buckingham County Board of Supervisors. See Va. Code Ann. § 10.1-1321.1(A) ("No application for a permit for a new or major modified stationary air pollution source shall be considered complete unless the applicant has provided the Director [of DEQ] with notification from the governing body of the county . . . in which the source is to be located that the location and operation of the source are consistent with all [local] ordinances."). The Board of Supervisors issued the SUP in February 2017, and it contained 41 conditions for the Compressor Station. These conditions included emergency response requirements, a notification process for planned natural gas venting events, noise mitigation measures, light regulations, and zoning setbacks. Based on the SUP, Buckingham County certified to DEQ that the Compressor Station "is fully consistent with all applicable local ordinances." J.A. 323 (bolding omitted).[3]

         B. Factual and Procedural History

         Because natural gas transported through the Pipeline must remain pressurized, ACP sought to construct three compressor stations in different locations along the Pipeline --one in West Virginia, one in Virginia (the Buckingham County location at issue here), and one in North Carolina.

         ACP claims the Compressor Station site in Buckingham County is "the only feasible location" because: (1) "it allows the ACP to interconnect with the existing Transco pipeline";[4] (2) "it was available for [ACP] to purchase commercially"; and (3) "the Federal Energy Regulatory Commission ('FERC') ruled out the only other site that met the previous two criteria [the Midland Road Site, [5] which would require 1.1 miles of additional pipeline]." ACP Br. 10-11.

         As stated above, on September 17, 2015, ACP filed an application with DEQ for a Permit to construct and operate the Compressor Station. DEQ deemed the application complete in the summer of 2018.

         1.

         Public Comments and Hearings

         After the Permit application was complete, DEQ provided several comment periods. On August 16, 2018, at the beginning of the first 30-day comment period, DEQ held an informational session for the residents of Buckingham County. DEQ representatives stated that, before the Board would take final action on the permit application, it would consider all comments. They also assured all public commenters that they could address the Board at a public meeting. After the comment period closed, DEQ conducted a public hearing on September 11, 2018, and heard proposed comments. Almost 200 people attended, and 60 people made oral comments. DEQ extended the comment period by 10 days. Over the 40 day comment period, DEQ received more than 5, 300 comments. "Many comments" expressed "concerns about the potential for disproportionate impacts of the proposed facility on the African American population in Union Hill." J.A. 2174.

         On November 8, 2018, the seven-member Board held its first public hearing. DEQ presented its summary of public comments from the 40 day comment period for the Board's consideration. These comments included concerns such as whether the "[f]acility should use electric turbines" instead of natural gas turbines, criticism that EPA's "[a]ir quality standards [are] not adequately protective," and "[e]nvironmental [j]ustice" and "[s]ite suitability issues." J.A. 1584. More than 80 people spoke at the hearing, and the Board made the following statements to and inquiries of DEQ officials:

• "[W]hat can you tell me about the demographics of Union Hill? I'd like to know about the community. I'd like to know about the race, the age distribution, anything you know about the health status of the community." J.A. 2260.
• "I thought [DEQ presented] a very narrow construction of what environmental justice means, and the reason I feel it's important for me to point that out is because I do think that site suitability and environmental justice are wrapped up together." Id. at 2344.
• "[H]ow is it that DEQ interprets [the Commonwealth Energy Plan] with respect to its obligations to consider environmental ...

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