Environmental -- 2015

Solvay USA Inc. v. EPA   (D.C. Circuit)

Challenging EPA's Non-Hazardous Secondary Materials rule

On June 16, 2011, the NAM filed a petition for review of the EPA’s Non-Hazardous Secondary Materials (NHSM) rule under the suite of Boiler MACT rules. The NHSM rule will classify as solid waste certain “secondary” materials that are currently used as a source of energy, such as coal ash or biomass residues from lumber. Solid waste must be burned in boilers regulated under more onerous rules than apply to fuels. The NAM is concerned with several aspects of the rule, including its effect on the use of non-hazardous materials, its presumption that all non-hazardous secondary materials are solid waste, and other provisions.

A list of legal issues in the case was filed, including challenging EPA's presumption that all non-hazardous secondary materials are solid waste, and its definition of "contaminants," "traditional fuels," and "contained gaseous material." Also at issue, among other things, is whether EPA violated the Regulatory Flexibility Act by failing to consider the economic impacts of the rule on small businesses.

In 2013, National Ass'n of Clean Water Agencies v. EPA was consolidated with the NAM suit into Solvay USA Inc. v. EPA. Our main brief on the merits, filed 4/28/2014, raised 4 key challenges to EPA's rule: (1) that EPA improperly decided that transferring alternative fuels to third parties for combustion is a discard and therefore such fuels are solid wastes, (2) that EPA improperly classified as solid waste alternative fuels such as those made from construction and demolition wood, railroad ties, and other treated woods that have heating value, are managed as valuable fuel, and are processed to create new fuel products, (3) that EPA improperly classified as solid waste alternative fuels such as paper recycling residuals, even though the record demonstrates no discard has occurred and the combustion is an integral part of an industrial process or functionally equivalent to a traditional fuel, and (4) that EPA improperly classified as solid waste sewage sludge when combusted even though the Resource Conservation and Recovery Act (RCRA) prohibits such a classification.

The practical effect of EPA's rule is that alternative fuel that could have been productively combusted will be managed as a waste and can only be combusted in a solid waste incinerator under much more expensive rules, leading to an enormous increase in landfill disposal, which has its own set of environmental harms.

Our brief as intervenors was filed Aug. 29, 2014, and emphasized that EPA could find under RCRA that discarded material could be recovered and processed into a non-waste fuel product, and that it could properly classify as non-wastes scrap tires, used oil, pulp and paper residuals, construction and demolition debris and other traditional fuels.

On June 3, 2015, the Court of Appeals denied Solvay’s petition for review as well as those of the environmental groups that challenged the rule. The court reasoned that the argument regarding sewage sludge is foreclosed by RCRA’s plain language and that EPA’s distinction between material burned by the generator and material transferred to a third party is consistent with RCRA and reasonable. It allowed EPA to place the burden on regulated entities to show that its material should not be regulated, because Congress wanted EPA "to err on the side of caution."

The court also rejected an environmental challenge to EPA's treating materials that are indistinguishable from virgin materials as non-waste fuel.

Related Documents:
Joint Reply Brief of Industry Petitioners  (September 29, 2014)
Joint Brief of Industry Intervenor-Respondents (incl. NAM)  (August 29, 2014)
NAM brief on the merits  (April 28, 2014)
Statement of Issues  (July 8, 2011)
NAM petition  (June 16, 2011)


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