Communities for a Better Environment v. United States Environmental Protection Agency

MEMORANDUM

1. EPA reasonably determined that the District was not obligated to track the credits transferred to the Sentinel project using Rule 1315 of Regulation XIII. Rule 1315 is merely one way in which the District chooses to demonstrate compliance with the Clean Air Act’s requirements that emission credits be quantifiable and surplus. See 42 U.S.C. § 7503 (c); 40 C.F.R. § 51.165 (a)(3)(ii)(C)(l)(I). The District is free to use another method of showing compliance with those requirements if that other method is written into an amended State Implementation Plan (SIP), as was the case here. See Natural Res. Def. Council, Inc. v. S. Coast Air Quality Mgmt. Dist., 651 F.3d 1066, 1073 (9th Cir.2011).

2. EPA was neither arbitrary nor capricious in determining that the credits transferred to Sentinel were quantifiable and surplus.

First, contrary to petitioners’ assertion, EPA did not extrapolate emission savings from shut down sources based on the emission limits those sources were permitted to have, but instead relied on the amount they were actually emitting. Nor was it arbitrary or capricious for EPA to accept credits from sources for which only one year of data was available.…