The Fifth Circuit Court of Appeals has vacated the U.S. Environmental Protection Agency’s (EPA’s) disapproval of aspects of Texas’s flexible air permitting program. Texas v. EPA, No. 10-60614 (5th Cir. 8/13/12). Texas submitted the program, which allowed changes that increased emissions as long as they stayed below a level set in the permit, as part of its State Implementation Program (SI P) under the Clean Air Act (CAA) in 1994. EPA issued its final disapproval of the provisions in 2010.  

The court focused in part on the delay between the submittal and EPA’s disapproval, but also found EPA’s three articulated bases for disapproval inadequate. The court held that because the SI P was Texas law, it owed EPA’s interpretation of the Texas rule no deference. The court found that, contrary to EPA’s assertions, (i) express Texas rule provisions ensured that flexible permits would not be a vehicle to avoid new source review (NSR ) for major modifications under the CAA; (ii) monitoring, record keeping and recording (MRR ) provisions were not inadequate, since the Texas rule required individualized MRR provisions in each permit; and (iii) the methodology for calculating emissions caps was sufficiently clear and replicable.  

According to the court, the “CAA does not make the replicability the EPA desires a standard for disapproving a SI P revision, and the EPA has not explained how the method for calculating emissions caps otherwise relates to a CAA standard.”