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Hooker Chemicals & Plastics Corp. v. Train

decided: April 28, 1976.

HOOKER CHEMICALS & PLASTICS CORP., STAUFFER CHEMICAL COMPANY, MONSANTO COMPANY, PETITIONERS,
v.
RUSSELL E. TRAIN, AS ADMINISTRATOR, ENVIRONMENTAL PROTECTION AGENCY, RESPONDENT



Petition to review and set aside regulations establishing "new source" limitations for the phosphate manufacturing industry promulgated by the Environmental Protection Agency pursuant to the Federal Water Pollution Control Act Amendments, 33 U.S.C. §§ 1251 et seq. Regulations set aside to the extent indicated and remanded to the Environmental Protection Agency for further proceedings consistent with this opinion.

Moore, Circuit Judge, and Frederick van Pelt Bryan and Kevin T. Duffy,*fn* District Judges.

Author: Moore

MOORE, Circuit Judge:

This case is a companion to our accompanying decision Hooker Chemicals & Plastics Corp. v. Train, 537 F.2d 620 (2d Cir. 1976) ("74-1687") in which we considered the validity of regulations limiting effluent discharges by existing manufacturers of phosphorus and related chemical compounds. Petitioners in this case seek to have this Court review and set aside regulations affecting "new source" manufacturers in the same industry. A "new source" is any source of liquid effluent, the construction of which is commenced after the publication of applicable regulations.*fn1 The regulations establish a level of zero discharge of process waste water for all "new source" manufacturers of elemental phosphorus,*fn2 phosphoric acid, phosphorus pentoxide, phosphorus pentasulfide, phosphorus trichloride, phosphorus oxychloride,*fn3 sodium tripolyphosphate, and feed and food grade calcium phosphate.*fn4

These regulations were promulgated pursuant to § 306*fn5 of the Federal Water Pollution Control Act Amendments, 33 U.S.C. §§ 1251 et seq. ("Act"). Section 306 requires that the regulations reflect

"the greatest degree of effluent reduction which the Administrator determines to be achievable through application of the best available demonstrated control technology, processes, operating methods, or other alternatives including, where practicable, a standard permitting no discharge of pollutants."

Unlike the contested regulations in 74-1687 which applied to existing dischargers of liquid effluent, the regulations in this case apply only to facilities the construction of which is commenced after the regulations were published.*fn6 But both sets of regulations concern the same general industrial category of effluent dischargers, the phosphate and related chemical manufacturers, and both were promulgated by the Environmental Protection Agency ("EPA") simultaneously.

Since § 509(b)(1)(A)*fn7 of the Act explicitly confers jurisdiction on this Court to review regulations promulgated pursuant to § 306, we indisputably have subject matter jurisdiction and may proceed immediately to a discussion of Petitioners' arguments.

Petitioners divide their arguments into two categories: those addressed to the regulations as a whole, and those confined to regulations affecting the new source manufacturers of a particular chemical compound. But the nature of Petitioners' arguments does not alter the standard of review. As is true of the regulations for existing sources discussed in 74-1687, our inquiry is confined to the question of whether they are arbitrary, capricious or not otherwise in accordance in law.

We may summarily dispose of Petitioners' generic complaints. The Act requires the EPA in formulating "new source" regulations to consider (1) the cost of achieving compliance with the new source regulations; (2) the regulations' non-water quality environmental impact; and (3) energy requirements.*fn8 Without mentioning specific examples, Petitioners claim that the EPA sidestepped this methodological imperative. While we agree that the EPA is obligated to consider such factors during the rulemaking process, whether in fact it did do so, is a question which is best resolved in the less abstract context of a specific regulation. Thus, we turn to specific regulations governing "new source" manufacturers of particular phosphorus-related chemicals.

Our task is considerably lightened by the EPA's concession that "new source performance standards for phosphorus trichloride, phosphorus oxychloride, food grade sodium tripolyphosphate, and food grade calcium phosphate will be reconsidered."*fn9 All regulations relating to the aforementioned chemical compounds are remanded to the EPA for their desired reconsideration. Only the "new source" regulations for phosphorus and phosphorus pentasulfide require further consideration.

The Act mandates a regulatory standard for "new source" which resembles the standard prescribed for post-1983 regulations for existing sources. The latter are based on the "best available technology economically achievable" while the former must reflect the "best available demonstrated control technology." Presumably because of the similarity, the EPA merged the promulgation of regulations for new and existing sources into one procedure using the same data base. And in its briefs, the EPA advances the same arguments to support both its "new source" regulations and its 1983 regulations for existing sources.

Although Petitioners intimate a contrary view, we believe that the assimilation was not objectionable per se. American Iron & Steel Institute v. EPA, 526 F.2d 1027, at 1058 (3rd Cir. 1975). The two standards may not be identical (for example, the technology relied upon to formulate "new source" regulations must be "demonstrated"), but the distinctions do not require that the two types of regulation be promulgated independently. However, because of the assimilation, a rationale which is unpersuasive in the context of existing source regulations for 1983 will fare no better in the context of "new source" regulations. Tanners' Council of America, Inc. v. Train, 540 F.2d 1188, slip op. at 12 (4th Cir. 1976). Consequently, the reasons which led us to set aside the 1983 effluent limitation guidelines for phosphorus producers in 74-1687 require invalidation of the "new source" ...


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