IN RE NEWARK ENERGY CENTER PROPOSED AIR POLLUTION CONTROLOPERATING PERMIT MODIFICATION(NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
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Although it is posted on the internet, this opinion is binding only on the
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SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-5794-14T1
IN RE NEWARK ENERGY CENTER
PROPOSED AIR POLLUTION CONTROL
OPERATING PERMIT MODIFICATION.
Argued October 31, 2017 – Decided December 1, 2017
Before Judges Yannotti, Carroll and Mawla.
On appeal from New Jersey Department of
Environmental Protection, Program Interest
No. 08857.
Raghu Murthy argued the cause for appellants
Ironbound Community Corporation and New Jersey
Environmental Justice Alliance (Eastern
Environmental Law Center, attorneys; Mr.
Murthy and Aaron Kleinbaum, on the briefs).
John G. Valeri, Jr. argued the cause for
respondent Newark Energy Center (Chiesa
Shahinian & Giantomasi, PC, attorneys; Mr.
Valeri, on the brief).
Jung Kim, Deputy Attorney General, argued the
cause for respondent New Jersey Department of
Environmental Protection (Christopher S.
Porrino, Attorney General, attorney; Melissa
H. Raksa, Assistant Attorney General, of
counsel; Ms. Kim, on the brief).
PER CURIAM
Appellants are the Ironbound Community Corporation and the
New Jersey Environmental Justice Alliance. They appeal from a
decision of the New Jersey Department of Environmental Protection
(DEP) granting an application by Newark Energy Center (NEC) to
modify its 2012 Air Pollution Control Operating Permit.
Appellants contend the DEP issued the modification permit
without first requiring NEC to provide a public emergency response
plan, a public emergency notification plan, and detailed public
reports. As a consequence, appellants argue the modification
permit violates the federal Emergency Planning and Community
Right-to-Know Act of 1986 (EPCRA), 42 U.S.C.A. §§ 11001 to 11050,
the federal Clean Air Act (CAA), 42 U.S.C.A. §§ 7401 to 7671(q),
and the New Jersey Spill Compensation and Control Act (Spill Act),
N.J.S.A. 58:10-23.11 to -23.24, and thus must be vacated. After
reviewing the record and the applicable statutory and regulatory
provisions, we affirm the DEP's decision to grant the modification
permit.
I.
We summarize the pertinent facts. NEC owns and operates a
natural gas-powered electrical generating facility in the
Ironbound section of Newark. On November 1, 2012, the DEP issued
NEC's initial air control operating permit pursuant to the CAA,
as implemented in New Jersey by the Air Pollution Control Act
2 A-5794-14T1
(APCA), N.J.S.A. 26:2C-1 to -25.2, and the regulations promulgated
thereunder, N.J.A.C. 7:27-1.1 to -34.5. The 2012 permit allows
NEC to use contaminated water (gray water) obtained from the
Passaic Valley Sewerage Commission (PVSC) in NEC's cooling tower.
It also permits NEC to use sulfuric acid to lower the gray water's
pH level.1 The 2012 permit limits NEC's sulfuric acid emissions
to 10.57 tons per year.
Pertinent to this appeal, on August 27, 2014, NEC filed an
application for a significant modification to its 2012 operating
permit, pursuant to N.J.A.C. 7:27-22.24. NEC requested permission
to increase the amount of sulfuric acid used in its cooling tower
to sufficiently treat the gray water. NEC indicated in its
application that the increased use of sulfuric acid would not
increase the facility's allowable sulfuric acid emission rate.
In support of its application, NEC submitted information
explaining that proper chemical treatment of the cooling water is
essential to keep system surfaces at the facility free of
microbiological growth and mineral scales, and to maintain overall
system cleanliness and efficiency. NEC's application also advised
that, in accordance with design specifications, the pH level of
1
The pH scale measures how acidic or basic a substance is. The
pH scale ranges from 0 to 14. A pH of 7 is neutral. A pH less
than 7 is acidic. A pH greater than 7 is basic.
3 A-5794-14T1
the cooling tower water would be controlled by adding sulfuric
acid.
The DEP notified appellants of the proposed modification.
Additionally, NEC provided appellants with information concerning
its facility and the chemicals used there, and responded to
appellants' questions at an October 16, 2014 meeting. The DEP
also invited appellants to a meeting to discuss any issues raised
by NEC's pending application.
On December 16, 2014, the DEP published notice on its website
of its intent to approve the proposed significant modification to
NEC's permit. The notice stated that a public hearing was
scheduled for February 3, 2015, and public comments were due by
February 6, 2015. The DEP directly notified petitioners, the
United States Environmental Protection Agency (EPA), and
neighboring states about the pending permit application and public
comment period.
The DEP held the public hearing as scheduled, pursuant to
N.J.A.C. 7:27-22.11(a)(2) and -22.11(f). At the hearing, the DEP
explained its purpose was to "seek public comments on proposed
departmental actions modifying the [NEC] air pollution control
operating permit." The DEP further stated it was proposing to
approve the modification based on NEC's "compliance with all
applicable state and federal air pollution control laws and rules."
4 A-5794-14T1
Public comments spanned a wide variety of topics, including
emission increases; air quality modeling and monitoring; discharge
prevention and containment in the event of an explosion or spill;
and the potential danger to the Ironbound community and the
surrounding environment. Appellants participated in the hearing
and submitted written comments to the DEP and EPA expressing their
concerns about the proposed increase in the amount of chemicals
transported, stored, and added as part of NEC's water treatment
process.
On July 2, 2015, the DEP issued a report responding to the
public comments. The DEP proposed to approve NEC's application
to increase the annual permitted water tower chemical use limit
and storage based on its calculations showing that emissions would
remain unchanged even with the additional chemical use. The DEP
determined the additional chemicals were needed to raise the pH
of the cooling tower water and this would not cause any increase
to sulfuric acid emissions. It further noted the proposed
modifications would require NEC to continuously monitor the
cooling tower water pH level; perform monthly calculations of the
sulfuric acid emissions from the storage tank, turbines, duct
burners, and auxiliary boiler; and monitor the total sulfuric acid
emissions from the facility to ensure they comply with the annual
emission cap. In short, the DEP concluded the proposed increased
5 A-5794-14T1
use of chemicals/sulfuric acid at NEC's facility would not result
in any permitted emissions increase.
The DEP also addressed the public comments expressing
concerns about public safety. It noted "[t]here are many [s]tate
and [f]ederal laws and regulations designed to protect people and
the environment from incidents at facilities storing, handling,
or processing hazardous chemicals," including the Spill Act and
EPCRA. The report explained that NEC has an approved Discharge
Cleanup and Removal plan (DCR plan) and an approved Discharge
Prevention, Containment and Countermeasures Plan (DPCC plan), as
required by the Discharges of Petroleum and other Hazardous
Substances Rules, N.J.A.C. 7:1E-1.1 to -10.4, and specifically
N.J.A.C. 7:1E-4.2 and -4.3 (DPHS rules). The report further noted
that NEC attempted to contact the Local Emergency Planning
Committee (LEPC) to provide the DCR and DPCC plans as required by
EPCRA. The DEP explained, however, that the plans contain
security-sensitive information and are not generally available to
the public, pursuant to N.J.A.C. 7:1D-3.2(b)(7). It noted that,
under EPCRA, "the LEPC for Newark is responsible for establishing
an emergency plan covering community response and possible
evacuations in the case of releases and explosions."
The DEP issued a proposed permit action on July 7, 2015,
signaling its intention to approve the requested modification to
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NEC's air pollution control operating permit. As mandated by the
CAA and APCA, the DEP sent the proposed permit to the EPA for its
review and comment. 42 U.S.C.A § 7661d; N.J.A.C. 7:27-22.12. The
EPA had no comments, and, after the forty-five day review period
expired, the DEP issued the modification permit on August 24,
2015.
As a result of this action, NEC's 2012 permit was modified
to: (1) include the sulfuric acid storage tank in the existing
facility-wide sulfuric acid limit and include storage tank
emissions in the calculation to demonstrate compliance with this
limit; (2) raise the permitted water tower chemical use limit from
470 tons per year to 2267 tons per year; (3) add monitoring and
record keeping requirements to the cooling tower flow rate
limitation; and (4) add a new permit condition to regulate the pH
of the cooling tower water. This appeal followed.
II.
Appellants' primary contention on appeal is that the DEP was
required to obtain a complete public emergency response plan,
emergency notification plan, and detailed public reports before
approving the modification to NEC's air control operating permit.
They assert that such emergency planning documents are
prerequisites to approval of the modification permit pursuant to
the Spill Act, EPCRA, and Section 112(r) of the CAA. Consequently,
7 A-5794-14T1
appellants contend the lack of compliance with these statutory
provisions renders issuance of the modification permit void. In
response, NEC and the DEP argue that the modification permit
complies with all applicable statutes and the DEP did not abuse
its discretion in issuing the permit.
Appellate review of an administrative agency's final
determination is limited and deferential. In re Herrmann, 192
N.J. 19, 27 (2007). We accord "a 'strong presumption of
reasonableness' to an administrative agency's exercise of its
statutorily delegated responsibilities." Lavezzi v. State, 219
N.J. 163, 171 (2014) (citation omitted). A reviewing court may
"not substitute its judgment . . . for that of [the] administrative
agency." In re Young, 202 N.J. 50, 70 (2010).
Unless an agency's decision is "arbitrary, capricious, or
unreasonable, or [] not supported by substantial credible evidence
in the record as a whole[,]" it will be affirmed. Barrick v.
State, 218 N.J. 247, 259 (2014) (quoting In re Stallworth, 208
N.J. 182, 194 (2011)). In making this determination, a reviewing
court must examine:
(1) whether the agency's action violated the
legislative policies expressed or implied in
the act governing the agency; (2) whether the
evidence in the record substantially supports
the findings on which the agency's actions
were premised; and (3) "whether in applying
the legislative policies to the facts, the
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agency clearly erred in reaching a conclusion
that could not reasonably have been made on a
showing of the relevant factors."
[Id. at 260 (quoting In re Carter, 191 N.J.
474, 482 (2007)).]
The burden of proving arbitrary, capricious or unreasonable action
is upon the challenger. See Bueno v. Bd. of Trs., 422 N.J. Super.
227, 234 (App. Div. 2011).
An agency's "interpretation of statutes and regulations
within its implementing and enforcing responsibility" is entitled
to deference. Ibid. (citation omitted); see also Barry v. Arrow
Pontiac, Inc., 100 N.J. 57, 70 (1985) ("[T]he grant of authority
to an administrative agency is to be liberally construed to enable
the agency to accomplish the Legislature's goals." (citation
omitted)). Still, an agency's interpretation of the operative law
must not be "plainly unreasonable." Waksal v. Dir., Div. of
Taxation, 215 N.J. 224, 231 (2013) (citation omitted); see also
In re Agric., Aquacultural, & Horticultural Water Usage
Certification Rules, 410 N.J. Super. 209, 223 (App. Div. 2009)
("[A]dministrative agencies derive their authority from
legislation, the terms of which they cannot alter, nor are they
permitted to frustrate the legislative purpose."). Although
"deference is generally given to an administrative agency charged
with interpretation of the law, we are not bound by the agency's
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legal opinions." Bueno, supra, 422 N.J. Super. at 234 (citation
omitted); see also A.B. v. Div. of Med. Assistance & Health Servs.,
407 N.J. Super. 330, 340 (App. Div.), certif. denied, 200 N.J. 210
(2009).
In the present case, the DEP issued the air pollution control
operating permit to NEC pursuant to the APCA and the CAA. The
APCA authorizes the DEP to promulgate rules preventing,
controlling and prohibiting air pollution throughout the State.
N.J.S.A. 26:2C-8. Under the APCA, "[n]o person shall construct,
reconstruct, install, or modify equipment or control apparatus"
except in accordance with the APCA and implementing rules.
N.J.S.A. 26:2C-9.2(a). Additionally, the DEP may not issue an
operating permit or operating permit revision unless the applicant
shows that the equipment or control apparatus will operate as the
APCA and implementing rules intend. N.J.S.A. 26:2C-9.2(b).
The goal of the CAA is to "protect and enhance the quality
of the Nation's air resources[.]" 42 U.S.C.A. § 7401(b)(1). Title
V of the CAA requires certain stationary sources of air pollution
to obtain operating permits. 42 U.S.C.A. §§ 7661 to 7661(f);
Ocean Cty. Landfill Corp. v. USEPA, 631 F.3d 652, 654 (3d Cir.
2011). Title V does not impose "substantive pollution-control
requirements . . . [i]nstead, it is designed to facilitate
compliance and enforcement by consolidating into a single document
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all of [a] facility's obligations under the [CAA]." Util. Air
Regulatory Grp. v. EPA, __ U.S. __, ___, 134 S. Ct. 2427, 2436,
189 L. Ed. 2d 372, 385 (2014).
The Title V operating permit program is primarily implemented
and enforced by the states, with federal oversight by the EPA. In
New Jersey, the DEP is the Title V permitting authority. Ocean
Cty. Landfill, supra, 631 F.3d at 654. The operating permit
program includes public notice and comment requirements. N.J.A.C.
7:27-22.11. After the public comment period closes and the DEP
considers comments on the draft operating permit, it then sends
the EPA a copy of the proposed permit, the comments received, and
its response to those comments for the EPA's review. N.J.A.C.
7:27-22.12. If the EPA does not object to the proposed permit
within forty-five days, the DEP is then authorized to take final
action on the application for the operating permit. Ibid.
Under the CAA/Title V/APCA framework, all "major" facilities,
meaning those with the potential to emit certain threshold amounts
of various pollutants, are required to obtain an operating permit.
42 U.S.C.A. §§ 7661 to 7661(f). NEC's facility constitutes a
major facility, and, therefore, NEC was required to apply for a
permit modification. As noted, NEC sought a significant
modification of its permit to allow it to use an increased amount
of sulfuric acid in the water cooling process.
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The DEP issued the modification permit after determining that
the added chemicals presented no increase in emissions pollution.
Before the public comment period began, the DEP issued a notice
of its intent to approve the modified permit based on NEC's
certification that it "meets all applicable requirements of the
Federal [CAA] and the New Jersey [APCA]." Following DEP's
"evaluation of the information included in [NEC's] application,
and a review of [NEC's] compliance status, [the DEP] concluded
that this [modified] permit should be approved." After the
required public notice and comment period ended, the DEP submitted
the proposed permit for EPA review. The EPA offered no comments
or concerns, and the DEP issued the modification permit upon
determining it complied with the APCA.
Based on our review, we conclude there is sufficient credible
evidence in the record to support the agency's determination. NEC
explained why it needed to increase the amount of sulfuric acid
used in the treatment process, how the sulfuric acid would be used
to raise the pH level of the gray water, and that this would not
result in any additional acid emissions. The modified air permit
maintained the same allowable emission limits as the initial
operating permit and imposed additional monitoring and record
keeping conditions to ensure compliance. The permit application
process comported with all procedural and notice requirements, and
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appellants do not contend otherwise. Since NEC's application for
the modification permit complied with the APCA and its implementing
regulations, the DEP's decision to grant the permit was not
arbitrary, capricious, or unreasonable.
We reject appellants' contention that the DEP was also
required to determine whether NEC was in compliance with the Spill
Act, EPCRA, and the CAA before approving the modification permit.
We find appellants' reliance on these additional statutory and
regulatory provisions misplaced because they lie outside the air
pollution control approval process.
The Spill Act requires that facilities submit a DPCC plan and
a DCR plan. N.J.S.A. 58:10-23.11d2 and -23.11d3. While the DEP
reviews these plans to prevent discharge and provide emergency
response plans, the Spill Act's controlling provisions fail to
mention permitting, and do not link the Spill Act's emergency
planning and reporting obligations to a facility's eligibility for
a permit to operate. Moreover, the Spill Act and its implementing
regulations contain distinct enforcement mechanisms that provide
for civil administrative penalties for violations, and do not
include forfeiture or denial of a permit application. N.J.A.C.
7:1E-6.1 to 6.9.
Similarly, EPCRA also fails to note a link between its
emergency planning and reporting strictures and a facility's
13 A-5794-14T1
eligibility for an operating permit. Rather, like the Spill Act,
EPCRA provides its own unique enforcement provisions allowing for
citizen suits and the imposition of mandatory civil penalties upon
entities that fail to comply with its reporting requirements. 42
U.S.C.A. §§ 11045 and 11046.
Finally, appellants contend the DEP erred by issuing the
modified permit without first requiring NEC to comply with Section
112(r) of the CAA, also known as the Chemical Accident Prevention
Provisions (CAPP Rules). 40 C.F.R. §§ 68.1 to .220. Specifically,
they assert that "the 2012 Permit . . . included a condition which
incorporated [CAA] Section 112(r) . . . [which] places the burden
upon NEC to complete a public emergency response plan, and a public
emergency notification plan."
While NEC's initial 2012 operating permit required the
creation of a risk management plan, pursuant to Section 112(r),
this requirement only applies if the facility is producing,
processing, handling, or storing a chemical specifically listed
in 40 C.F.R. 68.130 in an amount above a certain threshold
quantity. Contrary to appellants' assertion, sulfuric acid, which
is the basis of their concern, is not a regulated substance
14 A-5794-14T1
pursuant to Section 112(r) and is not included in the list of
regulated substances codified at 40 C.F.R. 68.130.2
In any event, even if sulfuric acid is a regulated substance
and the CAPP rules apply, as appellants contend, Section 112(r)
and the CAPP rules make no mention of their bearing on permitting
decisions. Simply stated, while separate, independent federal and
state laws may impose public emergency response and notification
planning requirements upon industrial facilities such as NEC, they
did not govern the DEP's decision to approve NEC's application to
modify its air permit.
Affirmed.
2
In their reply brief, appellants additionally argue that NEC
stores ammonia in two tanks onsite, and that Section 112(r)
similarly applies to ammonia. However, an issue that is not
addressed in a party's initial merits brief is deemed to be waived.
See Drinker Biddle & Reath LLP v. N.J. Dept. of Law & Pub. Safety,
421 N.J. Super. 489, 496 n.5 (App. Div. 2011); Liebling v. Garden
State Indem., 337 N.J. Super. 447, 465-66 (App. Div.), certif.
denied, 169 N.J. 606 (2001). It is improper for a party to use a
reply brief to raise an issue for the first time or enlarge the
main argument. State v. Smith, 55 N.J. 476, 488, cert. denied,
400 U.S. 949, 91 S. Ct. 232, 27 L. Ed. 2d 256 (1970); L.J. Zucca,
Inc. v. Allen Bros. Wholesale Distribs. Inc., 434 N.J. Super. 60,
87 (App. Div.), certif. denied, 218 N.J. 273 (2014); N.J. Citizens
Underwriting Reciprocal Exch. v. Kieran Collins, D.C., LLC, 399
N.J. Super. 40, 50 (App. Div.), certif. denied, 196 N.J. 344
(2008); Borough of Berlin v. Remington & Vernick Eng'rs, 337 N.J.
Super. 590, 595-96 (App. Div.), certif. denied, 168 N.J. 294
(2001).
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