Alaska Wilderness League v. EPA

Where the Clean Air Act, 42 U.S.C. § 7661c(e), is ambiguous as to whether “increment” requirements are “applicable” to a temporary source, such as a drilling vessel, the Ninth Circuit will defer to the Environmental Protection Agency Environmental Appeals Board’s reasonable interpretation of the statute.

In 2011, Shell Offshore, Inc. (“Shell”) secured a permit to comply with Title V of the Clean Air Act (“the Act”). The permit allowed Shell to operate “pollutant emitting activities” with the drilling vessel called the Kulluk in the Beaufort Sea off Alaska’s North Slope. Before awarding Shell the permit, the Environmental Protection Agency (“EPA”) released a Statement of Basis, which established that the EPA would not require Shell “to analyze the effect its emissions would have on the increment for the Kulluk’s area of operation.” The EPA explained this controversial decision by concluding that, with respect to increment analysis under § 7661c(e) of the Act, no increment requirements applied to the Kulluk. The EPA’s permit also granted Shell an exemption of 500 meters surrounding the Kulluk from “ambient air” regulation. The Alaska Wilderness League (“AWL”) challenged the permit on multiple grounds before the EPA Environmental Appeals Board (“EAB”). The EAB rejected the AWL’s challenges, and AWL timely petitioned for review of the EAB decision. The Ninth Circuit first analyzed whether the EAB should be awarded deference under Chevron U.S.A. Inc. v. Natural Res. Def. Council, Inc. Finding that § 7661c(e) of the Act is ambiguous as to whether “increment” requirements are “applicable” to a temporary source, in this case, the Kulluk, the panel deferred to the EAB’s reasonable interpretation of § 7661c(e), which did not require a preconstruction increment analysis. The panel then denied AWL’s petition for review of the 500-meter “ambient air” regulation exemption that the EPA granted to Shell because the EPA decision was “a permissible application of the EPA’s regulations.” PETITION DENIED.