Chamber of Commerce of The U.S. v. Envtl. Prot. Agency

642 F.3d 192

395 U.S.App.D.C. 193

CHAMBER OF COMMERCE OF the UNITED STATES of America and National Automobile Dealers Association, Petitioners

v.ENVIRONMENTAL PROTECTION AGENCY, RespondentCommonwealth of Massachusetts, et al., Intervenors.

No. 09–1237.

United States Court of Appeals, District of Columbia Circuit.

Argued Jan. 18, 2011.Decided April 29, 2011.

On Petition for Review of an Order of the Environmental Protection Agency.Paul D. Clement argued the cause for petitioners. On the briefs were Robin S. Conrad, Andrew D. Koblenz, Douglas I. Greenhaus, Matthew G. Paulson, Alexandra M. Walsh, and Adam J. White. Jeffrey A. Lamken and Amar D. Sarwal entered appearances.Damien M. Schiff was on the brief for amicus curiae Pacific Legal Foundation in support of petitioners.Norman L. Rave Jr., Attorney, U.S. Department of Justice, argued the cause for respondent. With him on the brief was Michael Horowitz, Attorney, U.S. Environmental Protection Agency. John C. Cruden, Assistant Attorney General, U.S. Department of Justice, entered an appearance.Edmund G. Brown, Jr., Attorney General, Office of the Attorney General for the State of California, Kathleen A. Kenealy, Senior Assistant Attorney General, Marc N. Melnick, Deputy Attorney General; Andrew M. Cuomo, Attorney General, Office of the Attorney General for the State of New York, Michael J. Myers, Assistant Attorney General; Gary K. King, Attorney General, Office of the Attorney General for the State of New Mexico; Joseph R. Biden III, Attorney General, Office of the Attorney General for the State of Delaware, Valerie M. Satterfield, Deputy Attorney General; Richard Blumenthal, Attorney General, Office of the Attorney General for the State of Connecticut, Kimberly P. Massicotte and Matthew I. Levine, Assistant Attorneys General; Lisa Madigan, Attorney General, Office of the Attorney General for the State of Illinois, Gerald T. Karr, Assistant Attorney General; Martha Coakley, Attorney General, Office of the Attorney General for the Commonwealth of Massachusetts, William L. Pardee and Carol Iancu, Assistant Attorneys General; Thomas J. Miller, Attorney General, Office of the Attorney General for the State of Iowa, David R. Sheridan, Assistant Attorney General; Roberta James, Assistant Attorney General, Office of the Attorney General for the State of Maryland; Lori Swanson, Attorney General, Office of the Attorney General for the State of Minnesota, Jocelyn F. Olson, Assistant Attorney General; Janet T. Mills, Attorney General, Office of the Attorney General for the State of Maine, Gerald D. Reid, Assistant Attorney General; John Kroger, Attorney General, Office of the Attorney General for the State of Oregon, Paul Logan, Assistant Attorney General; William H. Sorrell, Attorney General, Office of the Attorney General for the State of Vermont, Thea J. Schwartz, Assistant Attorney General; Kevin Auerbacher, Jon Martin, and Jung Kim, Deputy Attorneys General, Office of the Attorney General for the State of New Jersey; Patrick C. Lynch, Attorney General, Office of the Attorney General for the State of Rhode Island, Gregory S. Schultz, Special Assistant Attorney General; Robert M. McKenna, Attorney General, Office of the Attorney General for the State of Washington, Leslie R. Seffern, Assistant Attorney General; Susan Shinkman, Chief Counsel, Commonwealth of Pennsylvania Department of Environmental Protection, Robert A. Reiley and Kristen M. Furlan, Assistant Counsel; Kurt R. Wiese, Barbara B. Baird, David Doniger, Joanne Spalding, Sean H. Donahue, Vickie Patton, and Pamela Campos were on the intervenors' brief in support of respondent. Frederick D. Augenstern I, Assistant Attorney General, Office of the Attorney General for the Commonwealth of Massachusetts, David G. Bookbinder, Beverly M. Conerton, Assistant Attorney General, Office of the Attorney General for the State of Minnesota, and Stephen R. Farris, Assistant Attorney General, Office of the Attorney General for the State of New Mexico, entered appearances.Deborah A. Sivas and Robb W. Kapla were on the brief for amici curiae Former U.S. EPA Administrators William K. Reilly and Russell E. Train in support of respondent.John W. Busterud was on the joint brief for amici curiae Pacific Gas and Electric Corporation and Sempra Energy. Mark D. Patrizio entered an appearance.Stephen F. Hinchman and Matthew F. Pawa were on the brief for amici curiae Car Dealers Adam D. Lee and Charles E. Frank in support of respondent.Helen Kang was on the brief for amici curiae Climate Scientists in support of respondent.Before: HENDERSON, GARLAND, and BROWN, Circuit Judges.Opinion for the Court filed by Circuit Judge GARLAND.GARLAND, Circuit Judge:

The Chamber of Commerce and the National Automobile Dealers Association petition for review of a decision by the Environmental Protection Agency (EPA) granting California a waiver from federal preemption under the Clean Air Act. The waiver allows California to implement its own regulations requiring automobile manufacturers to reduce fleet-average greenhouse gas emissions from new motor vehicles sold in the state. Because we lack jurisdiction to decide this case at this time in a suit brought by these petitioners, we dismiss the petition for review without reaching its merits.

I

The Clean Air Act (CAA) generally bars states from adopting their own emissions standards for new motor vehicles, leaving such regulations to federal control. See 42 U.S.C. § 7543(a) (“No State ... shall adopt or attempt to enforce any standard relating to the control of emissions from new motor vehicles or new motor vehicle engines”). Section 7543(b)(1) provides the following exception to federal preemption:

(b)(1) The Administrator [of EPA] shall, after notice and opportunity for public hearing, waive application of this section to any State which has adopted standards ... for the control of emissions from new motor vehicles or new motor vehicle engines prior to March 30, 1966, if the State determines that the State standards will be, in the aggregate, at least as protective of public health and welfare as applicable Federal standards. No such waiver shall be granted if the Administrator finds that—

(A) the determination of the State is arbitrary and capricious,

(B) such State does not need such State standards to meet compelling and extraordinary conditions, or

(C) such State standards and accompanying enforcement procedures are not consistent with section 7521(a) of this title.

42 U.S.C. § 7543(b)(1). As California is the only state that had adopted emissions standards prior to March 30, 1966, it is the only state eligible for a waiver of federal preemption under this provision. See Ford Motor Co. v. EPA, 606 F.2d 1293, 1296 (D.C.Cir.1979). In 1977, however, Congress amended the CAA to permit other states to adopt and enforce standards “identical to the California standards for which a waiver has been granted,” without obtaining a separate waiver, provided that both California and the other state have given manufacturers a two-year lead time. 42 U.S.C. § 7507. States that adopt California's motor vehicle emissions program are referred to as “Section 177 states,” after the section of the CAA that authorizes them to do so. See Ford Motor Co., 606 F.2d at 1298, 1301 n. 54.

In September 2004, the California Air Resources Board (CARB) adopted regulations setting fleet-average greenhouse gas ¹ emissions standards for new motor vehicles beginning in Model Year (MY) 2009. See Cal.Code Reg. tit. 13, § 1961.1. Under those regulations, manufacturers receive credits for meeting the standards before MY 2009, for exceeding the standards in subsequent model years, and for selling alternative fuel vehicles. These credits may be banked for later use or sold to another manufacturer. Id. § 1961.1(b). If a manufacturer fails to comply in a particular model year, it begins to accrue debits. A manufacturer may incur a debit in any model year without penalty so long as it makes up the debit within five years, either by generating credits or purchasing credits from another manufacturer. Id. The standards become stricter as the model years progress. Id. § 1961.1(a).

On December 21, 2005, CARB asked EPA to waive federal preemption of California's greenhouse gas emissions standards pursuant to § 7543(b)(1). EPA denied the request. Its decision, published in March 2008, stated that “California does not need its motor vehicle [greenhouse gas] standards to meet compelling and extraordinary conditions,” as § 7543(b)(1)(B) requires. Decision Denying a Waiver of Clean Air Act Preemption, 73 Fed.Reg. 12,156, 12,159 (Mar. 6, 2008). The agency recognized that it had previously interpreted § 7543(b)(1)(B) to ask only whether California continued to need its own motor vehicle program as a whole to address compelling and extraordinary conditions. Id. at 12,159–61. But it concluded that § 7543(b)(1)(B) was subject to multiple interpretations, and when applied to emissions standards designed to address global as opposed to local or regional air pollution problems, it was best understood to require that EPA assess California's need for the newly proposed standards by themselves. Id. California could not satisfy this requirement, EPA reasoned, because California-specific conditions are not “the fundamental causal factors for the air pollution problem of elevated concentrations of greenhouse gases,” and, alternatively, because the effects of global climate change in California “are not sufficiently different from conditions in the nation as a whole to justify separate state standards.” Id. at 12,162, 12,168. Thereafter, California, several other states, and several environmental groups petitioned this court for review.²

On January 21, 2009, CARB asked EPA to reconsider its previous denial. EPA agreed to reconsider and, on July 8, 2009, after a public hearing and comment period, issued a decision granting the waiver. Decision...