LEVENTHAL, Circuit Judge:
These consolidated petitions of International Harvester and the three major auto companies, Ford, General Motors and Chrysler, seek review
I. STATEMENT OF THE CASE
The tension of forces presented by the controversy over automobile emission standards may be focused by two central observations:
(1) The automobile is an essential pillar of the American economy. Some 28 per cent of the nonfarm workforce draws its livelihood from the automobile industry and its products.
(2) The automobile has had a devastating impact on the American environment. As of 1970, authoritative voices stated that "[a]utomotive pollution constitutes in excess of 60% of our national air pollution problem" and more than 80 per cent of the air pollutants in concentrated urban areas.
A. Statutory Framework
Congressional concern over the problem of automotive emissions dates back to the 1950's,
The development of emission control technology proceeded haltingly. The Secretary of HEW testified in 1967 that
The legislative background must also take into account the fact that in 1969 the Department of Justice brought suit against the four largest automobile manufacturers on grounds that they had conspired to delay the development of emission control devices.
On December 31, 1970, Congress grasped the nettle and amended the Clean Air Act to set a statutory standard for required reductions in levels of hydrocarbons (HC) and carbon monoxide. (CO) which must be achieved for 1975 models of light duty vehicles. Section 202(b) of the Act added by the Clean Air Amendments of 1970, provides that, beginning with the 1975 model year, exhaust emission of hydrocarbons and carbon monoxide from "light duty vehicles" must be reduced at least 90 per cent from the permissible emission levels in the 1970 model year.
Congress was aware that these 1975 standards were "drastic medicine,"
The statute provides that an application for suspension may be filed any time after January 1, 1972, and that the Administrator must issue a decision thereon within 60 days. On March 13, 1972, Volvo, Inc., filed an application for suspension and thereby triggered the running of the 60 day period for a decision. 37 Fed.Reg. 5766 (March 21, 1972.)
The Decision began with the statement of the grounds for denial: ". . . I am unable, on the basis of the information submitted by the applicants or otherwise available to me, to make the determinations required, by section 202 (b) (5) (D) (i), (iii), or (iv) of the Act."
A Technical Appendix, containing the analysis and methodology used by the Administrator in arriving at his decision, was subsequently issued on July 27, 1972.
B. Initial Decision of the Administrator
The data available from the concerned parties related to 384 test vehicles run by the five applicants and the eight other vehicle manufacturers subpoenaed by the Administrator. In addition, 116 test vehicles were run by catalyst and reactor manufacturers subpoenaed by the Administrator. These 500 vehicles were used to test five principal types of control systems: noble metal monolithic catalysts, base metal pellet catalysts, noble metal pellet catalysts, reactor systems, and various reactor/catalyst combinations.
At the outset of his Decision, the Administrator determined that the most effective system so far developed was the noble metal oxidizing catalyst.
The problem the Administrator faced in making a determination that technology was available, on the basis of these data, was that actual tests showed only one car with actual emissions which conformed to the standard prescribing a maximum of .41 grams, per mile, of HC and 3.4 grams per mile of CO.
Instead, certain data of the auto companies were used as a starting point for making a prediction, but remolded into a more useable form for this purpose. As the Administrator put it:
In light of these difficulties, the Administrator "adjusted" the data of the auto companies by use of several critical assumptions.
First, he made an adjustment to reflect the assumption that fuel used in 1975 model year cars would either contain an average of .03 grams per gallon or .05 grams per gallon of lead.
Second, the Administrator found that the attempt of some companies to reduce emissions of nitrogen oxides below the 1975 Federal standard of 3.0 grams per vehicle mile
Third, the Administrator took into account the effect the "durability" of the preferred systems would have on the emission control obtainable. This required that observed readings at one point of usage be increased by a deterioration factor (DF) to project emissions at a later moment of use. The critical methodological choice was to make this adjustment from a base of emissions observed at 4000 miles. Thus, even if a car had actually been tested over 4000 miles, predicted emissions at 50,000 miles would be determined by multiplying 4000 mile emissions by the DF factor.
Fourth, the Administrator adjusted for "prototype-to-production slippage." This was an upward adjustment made necessary by the possibility that prototype cars might have features which reduced HC and CO emissions, but were not capable of being used in actual production vehicles.
Finally, in accord with a regulation assumed, as to substance, in the text of the Decision, but proposed after the suspension hearing,
With the data submitted and the above assumptions, the Administrator concluded that no showing had been made that requisite technology was not available. The EPA noted that this did not mean that the variety of vehicles produced in 1975 would be as extensive as before. According to EPA, "Congress clearly intended to require major changes in the kinds of automobiles produced for sale in the United States after 1974" and there "is no basis, therefore, for construing the Act to authorizing suspension of the standards simply because the range of performance of cars with effective emission control may be restricted as compared to present cars." As long as "basic demand" for new light duty motor vehicles was satisfied, the applicants could not establish that technology was not available.
For purposes of judicial review, the initial EPA decision rests on the technology determination. The Administrator did state:
The statute apparently contemplates the possibility of an EPA denial of suspension for failure to meet criterion (i) of § 202 (b) (5) (D) ("essential to the public interest") even though criterion (iii) has been satisfied ("applicant has established that effective control technology . . [is] not available").
The Administrator also offered some "comments" on issues pertinent to the required "good faith" determination under standard (ii), as guidance to applications who might seek a one year suspension next year of the 1976 oxides of nitrogen standard. But he explictly disclaimed reaching that question in this proceeding. The thrust of his comment was to call into question the rigid "arms length" relationship structure which vehicle manufacturers imposed on their suppliers, as a source of a halter on progress in developing the required technology.
C. This Court's December 1972 Remand
After oral argument to this court on December 18, 1972, in a per curiam order issued December 19, 1972, we remanded the record to the Administrator, directing him to supplement his May 12, 1972 decision by setting forth:
Our remand order was not intended to indicate that we had concluded that an EPA conclusion was required as to clause (iv) — concerning the evaluation based on the NAS study and other information (from sources other than applicants) — when the Administrator had determined under (iii) that the auto companies had not shown technology was not available. We were nevertheless troubled by arguments advanced by petitioners that the methodology used by the Administrator in reaching his conclusion, and indeed the conclusion itself, was inconsistent with that of the Academy. It was our view that if and to the extent such differences existed they should be explained by EPA, in order to aid us in determining whether the Administrator's conclusion under (iii) rested on a reasoned basis.
D. Supplement to the Decision of the Administrator
Our remand of the record resulted in a "Supplement to Decision of the Administrator" issued December 30, 1972. The Administrator in his Supplement stated that "In general I consider the factual findings and technical conclusions set forth in the NAS report and in the subsequent Interim Standards Report dated April 26, 1972 . . to be consistent with my decision of May 12, 1972."
The Report made by the NAS, pursuant to its obligation under 202 (b) (5) (D) of the Clean Air Act, had concluded: "The Committee finds that the technology necessary to meet the requirements of the Clean Air Act Amendments for 1975 model year light-duty motor vehicles is not available at this time."
The Administrator apparently relied, however, on the NAS Report to bolster his conclusion that the applicants had not established that technology was unavailable.
The Administrator pointed out that two of NAS's provisos — catalytic converter replacement and low lead levels — had been accounted for in his analysis of the auto company data, and provision therefor had been insured through regulation.
The Administrator also claimed that he had employed the same methodology as the NAS used in its Interim Standards Report, evidently referring to the use of 4000 mile emissions as a base point, and correction for a deterioration factor and a prototype-production slippage factor.
The Administrator did refer to the "severe driveability problems" underscored by the NAS Report, which in the judgment of NAS "could have significant safety implications,"
II. REJECTION OF MANUFACTURERS' GENERAL CONTENTIONS
We begin with consideration, and rejection, of the broad objections leveled by petitioners against EPA's over-all approach.
A. Future Technological Developments
We cannot accept petitioners' arguments that the Administrator's determination whether technology was "available," within the meaning of section 202 (b) (5) (D) of the Act, must be based solely on technology in being as of the time of the application, and that the requirement that this be "available" precludes any consideration by the Administrator of what he determines to be the "probable" or likely sequence of the technology already experienced. Congress recognized that approximately two years' time was required before the start of production for a given model year, for the preparation of tooling and manufacturing processes.
The petitioners' references to the legislative history are unconvincing. None of the statements quoted in their briefs specifically states that "available" as used in the statute means "available in 1972." There is even comment that points to a contrary interpretation.
While we reject the contention as broadly stated, principally by General Motors, we hasten to add that the Administrator's latitude for projection is subject to the restraints of reasonableness, and does not open the door to "`crystal ball' inquiry."
B. Claimed Right of Cross-Examination
Chrysler has advanced a due process claim based upon two principal features of the proceeding, the inability to engage in cross-examination and the inability to present arguments against the methodology used in the Technical Appendix of the Administrator, which served as a basis for his decision.
The suspension provision of Section 202 (b) (5) (D) does not require a trial type hearing. It provides:
First, this provision for a "public hearing" contrasts significantly with other provisions that specifically require an adjudicatory hearing.
As to legislative history of this provision, the starting point is the provision in Senate Bill 4358:
This was dropped in conference, along with a provision permitting six months for a suspension decision. The resulting legislation both expedited the decision-making, and contemplated EPA solicitation of a wide range of views, from sources other than the auto companies, though the companies' applications and presentation would surely be the focus of consideration. Underlying this approach of both shortening time for decision and enlarging input lies, we think, an assumption of an informative but efficient procedure without mandate for oral cross examination.
In context, the "public hearing" provision amounts to an assurance by Congress that the issues would not be disposed of merely on written comments, the minimum protection assured by the Administrative Procedure Act for rulemaking, but would also comprehend oral submissions of a legislative nature. These are required even for rule-making when "controversial regulations governing competitive practices" are involved. American Airlines, Inc. v. CAB, 123 U.S. App.D.C. 310, 317, 359 F.2d 624, 631 (en banc 1966), cert. denied, 385 U.S. 843, 87 S.Ct. 73, 17 L.Ed.2d 75 (1966); Walter Holm & Co. v. Hardin, 145 U.S.App. D.C. 347, 449 F.2d 1009 (1971). Even assuming oral submission, in a situation where "general policy" is the focal question, a legislative-type hearing is appropriate.
A complication is presented by the case before us in that the general policy questions became interfused with relatively specific technical issues. Yet within the context of a quasi-legislative hearing and the time constraints of the statute, we do not think the absence of a general right of cross-examination on the part of the companies was a departure from "basic considerations of fairness." Walter Holm & Co. v. Hardin, supra, 145 U.S.App.D.C. at 354, 449 F. 2d at 1016. Hearings ran for two weeks and a wide range of participants was included within the proceeding: manufacturers, vendors of the control devices and public interest groups. The auto companies were allowed to submit written questions to the Hearing Panel to be asked to various witnesses. Opportunity to prepare written questions is not as satisfactory to counsel as the opportunity to proceed on oral cross-examination, with questions that develop from previous answers. But examination on interrogatories has long been used in the law when necessary, albeit second best. And
We distinguish between the assertion of a broad right of cross-examination, such as that argued to this court, and a claim of a need for cross-examination of live witnesses on a subject of critical importance which could not be adequately ventilated under the general procedures. This is the kind of distinction that this court made in its en banc opinion in American Airlines v. CAB, supra, 123 U.S.App.D.C. at 318-319, 359 F.2d at 632-633. We see no principled manner in which firm time limits can be scheduled for cross-examination consistent with its unique potential as an "engine of truth" — the capacity given a diligent and resourceful counsel to expose subdued premises, to pursue evasive witnesses, to "explore" the whole witness, often traveling unexpected avenues.
Given the variances in counsel, the reality that seasoning and experience are required even for trial judges who seek to avoid repetitive and undue cross-examination, the enhancement of difficulties encountered with the breadth of issues involved in a "public interest" proceeding, the fairly-anticipated problem of provision for redirect (and recross) and the interplay of different cross-examinations, there is not insignificant potential for havoc. What is most significant is that these complications are likely to be disproportionate to the values achieved, in a proceeding focusing on technical matters where other techniques generally are sufficient to adduce the pertinent information as to both what is known and unknown.
In context, we consider that the technique, adopted by EPA, of pre-screening written questions submitted in advance is reasonable and comports with basic fairness as the general procedure. This approach permits screening by the hearing officer so as to avoid irrelevance and repetition, permits a reasonable estimate of the time required for the questioning, and aids scheduling and allocation of available time among various participants and interests.
We revert to our observation that a right of cross-examination, consistent with time limitations, might well extend to particular cases of need, on critical points where the general procedure proved inadequate to probe "soft" and sensitive subjects and witnesses. No such circumscribed and justified requests were made in this proceeding.
C. Right To Comment on EPA Methodology
A more serious problem, at least from the point of an informed decision-making process, is posed by the
While the statute makes no express provision therefor, we assume that Congress contemplated a flexibility in the administrative process permitting the manufacturers to present to EPA any comments as to its methodology, in a petition for reconsideration or modification. However, this opportunity does not permit invocation of the doctrine of failure to exhaust administrative remedies as a bar to these appeals, for those petitions could not have affected or deferred the finality of the EPA decision or the time for seeking judicial review. The opportunity is noted to obviate any possibility that the law, or our comments, may be misunderstood to require a rigid procedure of prompt and unshakeable decision-making. Our own December remand requesting clarification of the Decision illustrates that while this statute imposes some unusual time restraints it does not jettison the flexibility and capacity of reexamination that is rooted in the administrative process. American Airlines v. CAB, supra, 123 U.S. App.D.C. at 319; 359 F.2d at 633.
As matters have shaped up, the central technical issue on this appeal concerns the reliability of EPA's methodology. While we do not say that the failure to provide reasonable opportunity to comment on EPA methodology invalidates the EPA Decision for lack of procedural due process, or similar contention, we must in all candor accompany that ruling with the comment that the lack of such opportunity has had serious implications for the court given the role of judicial review.
We shall subsequently develop the legal questions, primarily questions of EPA's burden of proof, that arise with respect to EPA methodology. We preface these with admission of our doubts and diffidence. We are beset with contentions of petitioners that bear indicia of substantiality. Yet we have no EPA comment on the specific questions raised, apart from some discussion by counsel which is not an adequate or appropriate substitute.
The EPA might have indicated that it desired to take a fresh look at its methodology on the basis of petitioners' criticisms, in which case, on an adaptation of the Smith v. Pollin,
Indeed, the fact that the Administrator issued the Technical Appendix almost three months after his Decision, at a time when judicial review had already begun to run its course, indicates that the agency did not believe that agency consideration was frozen from the moment that the suspension decision was rendered, a view we approve. The EPA had latitude to continue further consideration even without requesting a court remand (under Smith v. Pollin) that would suspend judicial consideration.
III. OVERALL PERSPECTIVE OF SUSPENSION ISSUE
This case ultimately involves difficult issues of statutory interpretation, as to the showing required for applicants to sustain their burden that technology is not available. It also taxes our ability to understand and evaluate technical issues upon which that showing, however it is to be defined, must rest. At the same time, however, larger questions are at stake. As Senator Baker put it, "This may be the biggest industrial judgment that has been made in the United States in this century." 116 Cong.Rec. 33,085 (1970). This task of reviewing the suspension decision was not assigned to us lightly. It was the judgment of Congress that this court, isolated as it is from political pressures, and able to partake of calm and judicious reflection would be a more suitable forum for review than even the Congress.
Two principal considerations compete for our attention. On the one hand, if suspension is not granted, and the prediction of the EPA Administrator that effective technology will be available is proven incorrect, grave economic consequences could ensue. This is the problem Senator Griffin described as the "dangerous game of economic roulette." 116 Cong.Rec. 33,081 (1970). On the other hand, if suspension is granted, and it later be shown that the Administrator's prediction of feasibility was achievable in 1975 there may be irretrievable ecological costs. It is to this second possibility we first turn.
A. Potential Environmental Costs
The most authoritative estimate in the record of the ecological costs of a one-year suspension is that of the NAS Report. Taking into account such "factors as the vehicle-age distribution among all automobiles, the decrease in vehicle miles driven per year, per car as vehicle age increases, the predicted nationwide growth in vehicle miles driven each year" and the effect of emission standards on exhaust control, NAS concluded that:
The question in this context is not whether these are costs the consumer should rightly bear if ecological damage is to be minimized, but rather the general effect on consumer purchasing of 1975 model year cars in anticipation of lower performance. A drop-off in purchase of 1975 cars will result in a prolonged usage of older cars with less efficient pollution control devices. If the adverse performance effect deterred purchasing significantly enough, resulting in greater retention of "older" cars in the "mix" of cars in use, it might even come to pass that total actual emissions (of all cars in use) would be greater under the 1975 than the 1974 standards.
Many of the anticipated performance problems are traceable to the systems introduced to conform cars to control of nitrogen oxides to achieve prescribed 1975 standards, by use of exhaust-gas recycle (EGR). Such systems affect vehicle-acceleration capability because the power output for a given engine displacement, engine speed, and throttle setting is reduced.
The NAS Report states that the effects of emission controls on vehicle driveability are difficult to quantify, but nevertheless makes the following qualitative evaluation:
The willingness of the consumer to buy 1975 model year cars may also be affected, to some degree, by the anticipated significant costs of pollution control devices. The problem is further bedeviled by the possibility that consumers albeit rightly assigned the cost burden of pollution devices, may seek to avoid that burden, however modest,
We may also note that it is the belief of many experts — both in and out of the automobile industry — that air pollution cannot be effectively checked until the industry finds a substitute for the conventional automotive power plant — the reciprocating internal combustion (i. e.,
The NAS estimated that there would be a small environmental cost to suspension of 1975 standards even if 1974 standards were retained, but further recommended intermediate standards that would dilute even such modest environmental cost.
Maximum emissions (grams per mile) HC CO 1974 standards ............... 3.4 39.0 Ford proposal ................ 1.6 19.0 NAS recommendation for Intermediate standards: No catalyst change ....... 1.1 8.2 One catalyst change ...... 0.8 6.3 1975 Standards ............... .41 3.4
Our concern that the 1975 standards may possibly be counter-productive, due to decreased driveability and increased cost, is not to be extrapolated into a caution against any improvement, and concomitant reduction in permitted emissions. In such matters, as the NAS recommendation for interim standards implicitly suggests, a difference in degree may be critical, and the insistence on absolute 1975 standards, without suspension or intermediate level, may stretch for the increment that is essentially counter-productive.
On balance the record indicates the environmental costs of a one-year suspension are likely to be relatively modest. This must be balanced against the potential economic costs — and ecological costs — if the Administrator's prediction on the availability of effective technology is incorrect.
B. Potential Economic Costs
Theoretical possibility of industry shutdown
If in 1974, when model year 1975 cars start to come off the production line, the automobiles of Ford, General Motors and Chrysler cannot meet the 1975 standards and do not qualify for certification, the Administrator of EPA has the theoretical authority, under the Clean Air Act, to shut down the auto industry, as was clearly recognized in Congressional debate.
The economic consequence of an approach geared to stringency, relying on relaxation as a safety valve
A more likely forecast, and one which enlightens what influenced the EPA decision to deny the suspension, was articulated by George Allen, Deputy Assistant Administrator for General Enforcement and a member of EPA's Hearing Panel:
Certain techniques available to the Administrator, through changes in the certification procedure, can be used in an even handed manner for all three auto companies to facilitate compliance with the 1975 standards. Already lower lead levels in fuel available for 1975 model year cars have been prescribed to increase the efficiency of the catalytic converter. Similarly certain changes in the regulatory system, through allowable maintenance and permitted change in the catalytic converter, have been made by EPA. These techniques work with reasonable impartiality as to the various auto companies.
However, a relaxation of standards, and promulgation of an interim standard, at a later hour — after the base hour for "lead time" has been passed, and the production sequence set in motion — forebodes quite different consequences. The record before us suggests that there already exists a technological gap between Ford and General Motors,
The case is haunted by the irony that what seems to be Ford's technological lead
In some contexts high achievement bestows the advantage that rightly belongs to the leader, of high quality. In this context before us, however, the high achievement in emission control results, under systems presently available, in lessened car performance — an inverse correlation. The competitive disadvantage to the ecological leader presents a forbidding outcome — if the initial assumption of feasibility is not validated, and there is subsequent relaxation — for which we see no remedy.
C. Light Weight Trucks
We now take up the serious contention of International Harvester (IH) that the EPA decision effectively rules out the production of 1975 model year IH light weight trucks and multi-purpose passenger vehicles (MPVs). This requires us to focus on the Administrator's conception that the 1970 Clean Air Act envisioned restricting production of vehicles to that necessary to fill "basic demand."
The Administrator does not dispute International Harvester's claim that it will not be able to produce the vehicles in question, and indeed the limited testing of one of its MPVs showed, even as evaluated by EPA methodology, that such standards could not be achieved.
The Administrator, nonetheless, takes the position that International Harvester can be denied a suspension because he has found that "new car demand" will be satisfied by the production of the major auto companies, and thus apparently posits that the absence from the 1975 market of all light weight trucks and MPVs is fully consistent with the Act. We cannot agree.
Section 202 (b) (1) of the Act applies its drastic standards to 1975 models of "light duty vehicles." It is our view that the legislative history reveals this term to mean "passenger cars." In the Report of the Senate Committee on Public Works on S.4358,
References abound in Congressional debate to the same effect.
For the above reasons we cannot sustain the definition of "Light duty vehicle" as:
to the extent that it includes light weight trucks in the category that must meet the drastic emission reduction standards
This is not to say that the modification of the "light duty vehicles" definition must exclude MPVs, which largely overlap in their usage with passenger cars. We merely hold the present regulation contrary to legislative intent. We have jurisdiction to decide this issue, even though the reasonableness of the regulation could be challenged in a separate proceeding in the District Court,
We decline the proposal of International Harvester, therefore, that only its vehicles be granted a suspension. Light weight trucks of other manufacturers, such as Ford, equally demonstrated an inability to comply with the 1975 standards.
Assuming light duty vehicles are defined by EPA to include MPVs a question may arise whether they are entitled to a one-year suspension, for lack of feasibility, even though passenger vehicles generally should be denied a suspension. We shall not consider this question unless and until EPA has had an opportunity to address itself to the problems in the light of our opinion herein.
D. The Issue of Feasibility Sufficient for Basic Auto Demand
The foregoing conclusion is not to be misunderstood as amounting to an acceptance of another "basic demand" contention raised by the auto manufacturers. We are inclined to agree with the Administrator that as long as feasible technology permits the demand for new passenger automobiles to be generally met, the basic requirements of the Act would be satisfied, even though this might occasion fewer models and a more limited choice of engine types. The driving preferences of hot rodders are not to outweigh the goal of a clean environment.
A difficult problem is posed by the companies' contention that the production and major retooling capacity does not exist to shift production from a large number of previous models and engine types to those capable of complying with the 1975 standards and meeting the demand for new cars. The Administrator made no finding as to this problem. We believe the statute requires such a finding, explaining how the Administrator estimates "basic demand" and how his definition conforms to the statutory objective. The emission standards set for 1976 cannot be breached, since they
A significant decrease in auto production will have a major economic impact on labor and suppliers to the companies. We have no reason to believe that "effective technology" did not comport within its meaning sufficient technology to meet a basic level of consumer demand.
E. Balancing of Risks
This case inevitably presents, to the court as to the Administrator, the need for a perspective on the suspension that is informed by an analysis which balances the costs of a "wrong decision" on feasibility against the gains of a correct one. These costs include the risks of grave maladjustments for the technological leader from the eleventh-hour grant of a suspension, and the impact on jobs and the economy from a decision which is only partially accurate, allowing companies to produce cars but at a significantly reduced level of output. Against this must be weighed the environmental savings from denial of suspension. The record indicates that these will be relatively modest. There is also the possibility that failure to grant a suspension may be counter-productive to the environment, if there is significant decline in performance characteristics.
Another consideration is present, that the real cost to granting a suspension arises from the symbolic compromise with the goal of a clean environment. We emphasize that our view of a one year suspension, and the intent of Congress as to a one year suspension, is in no sense to be taken as any support for further suspensions. This would plainly be contrary to the intent of Congress to set an absolute standard in 1976. On the contrary, we view the imperative of the Congressional requirement as to the significant improvement that must be wrought no later than 1976, as inter-related with the provision for one-year suspension. The flexibility in the statute provided by the availability of a one-year suspension only strengthens the impact of the absolute standard. Considerations of fairness will support comprehensive and firm, even drastic, regulations, provided a "safety valve" is also provided — ordinarily a provision for waiver, exception or adjustment, in this case a provision for suspension.
We approach the question of the burden of proof on the auto companies with the previous considerations before us.
IV. THE REQUIRED SHOWING ON "AVAILABLE TECHNOLOGY"
It is with utmost diffidence that we approach our assignment to review the Administrator's decision on "available technology." The legal issues are intermeshed with technical matters, and as yet judges have no scientific aides. Our diffidence is rooted in the underlying technical complexities, and remains even when we take into account that ours is a judicial review, and not a technical or policy redetermination, our review is channeled by a salutary restraint, and deference to the expertise of an agency that provides reasoned analysis. Nevertheless we must proceed to the task of judicial review assigned by Congress.
A. Requirement of Observed Data From Manufacturers
Clearly this requires that the applicants come forward with data which showed that they could not comply with the contemplated standards. The normal rules place such a burden on the party in control of the relevant information.
The submission of the auto companies unquestionably showed that no car had actually been driven 50,000 miles and achieved conformity of emissions to the 1975 standards. The Administrator's position is that on the basis of the methodology outlined, he can predict that the auto companies can meet the standards, and that the ability to make a prediction saying the companies can comply means that the petitioners have failed to sustain their burden of proof that they cannot comply.
B. Requisite Reliability of Methodology Relied on by EPA To Predict Feasibility Notwithstanding Lack of Actual Experience
We agree with the Administrator's proposition in general. Its validity as applied to this case rests on the reliability of his prediction, and the nature of his assumptions. One must distinguish between prediction and prophecy. See EDF v. Ruckelshaus, 142 U.S. App.D.C. 74, 89, 439 F.2d 584, 597 (1971). In a matter of this importance, the predictor must make a showing of reliability of the methodology of prediction, when that is being relied on to overcome this "adverse" actual test data of the auto companies. The statute does not contemplate use of a "crystal ball." See National Resources Defense Council, Inc. v. Morton, 148 U.S.App.D.C. 5, 15, 458 F.2d 827, 837 (1972).
The Administrator, however, raises a different issue by contending that the companies, wholly aside from his methodology, did not submit sufficient evidence to enable him to make the required determination as to "available technology." This goes to the standard rather than the burden of proof, and comes close to adoption of "beyond a reasonable doubt" as the required showing. Aside from a possible finding of bad faith, which the Administrator specifically eschews making, this position cannot stand. The companies came forward with all the data that there was to be had, and the Administrator did not specifically ask for more. Additionally, our perspective on the interests furthered by a sound EPA decision, and jeopardized by a "wrong decision," are material to the issue of standard of proof. This is a situation where, as we have stated, the risks of an erroneous denial of suspension outweigh the risks of an erroneous grant. On the issue of burden of proof, the standard adopted must take into account the nature and consequences of risk of error. See In re Winship, 397 U.S. 358, 371-372, 90 S.Ct. 1068, 25 L.Ed.2d 368 (1970) (Mr. Justice Harlan, concurring); U. S. v. Brown, 155 U.S.App.D.C. ___, 478 F.2d 606 (1973). This view of the standard of proof dictates the standard normally adopted in civil matters, a preponderance of the evidence.
The underlying issue is the reasonableness and reliability of the Administrator's methodology, for it alone offsets the data adduced by petitioners in support of suspension. It is the Administrator who must bear the burden on this matter, because the development and use of the methodology are attributable to his knowledge and expertise. When certain material "lies particularly within the knowledge" of a party he is ordinarily assigned the burden of adducing the pertinent information.
C. Analysis of EPA Assumptions
The multiple assumptions used by the Administrator in making his prediction are subject to serious doubts.
The basic formula used to make the prediction that each of the manufacturers could meet the 1975 standards was based on 1975 certification requirements, so that in part it paralleled testing procedures which would be used in 1975 to certify automobiles for sale. The formula is:
Four kinds of assumptions were used in making the 50,000 mile emission prediction: (1) regulatory, (2) engineering or scientific, (3) techniques of application of basic formula to particular companies, and (4) statistical reliability of the final prediction.
1. Regulatory assumptions
First, EPA assumed that certain types of maintenance would have to be performed on 1975 model year cars, if its 50,000 miles emission predictions were to be meaningful. Subsequent to the issue of its Technical Appendix, a Proposed Rule Making formulated these requirements as part of 1975 certification procedure.
Secondly, the predicted emission level assumes that there will be one total replacement of the catalytic converter at some time after 25,000 miles. This entered into the formula as an adjustment to the predicted deterioration factor.
The third regulatory assumption relates to the average lead level which will exist in gasoline available for 1975 model year cars. Lead levels in gasoline contribute to the levels of HC and CO both in terms of normal emission control achievable (the 4000 mile emission) and to the deterioration in emissions over time (deterioration factor). Thus, in the case of the Chrysler car used to predict conformity with the 1975 standards, a .03 lead in gasoline produced 4000 mile emissions of .27 grams HC and 1.51 CO, whereas a .05 level of lead resulted in .29 and 1.66 grams respectively. Similarly .03 lead produced a corrected deterioration factor of .67 HC and 1.5 CO, whereas a .05 level produced .73 HC and 1.65 CO.
On December 27, 1972, a regulation was promulgated "designed to assure general availability by July 1, 1974, of suitable gasolines containing no more than .05 grams per gallon of lead. . . ."
2. Engineering and scientific assumptions
Engineering or scientific assumptions are made in predicting 4000 mile emissions and deterioration factors, and we shall give separate consideration to each independent variable.
a. The 4000 mile emission factor
The use of 4000 mile emissions as a starting point is based on certification procedures.
Lead adjustment factor
This Lead Adjustment Factor was calculated using only Ford cars, but the value of the factor was assumed to be the same in adjusting Chrysler 4000 mile emissions with this factor.
EPA assumed that 200 hours on the dynamometer corresponded to 4000 miles usage, based on a critical and contested EPA assumption that the tests were conducted at 1000 RPM. Petitioners claim that the high temperature readings on the dynamometer reflect a higher RPM, and hence that a testing below 200 hours corresponded to 4000 miles of use. EPA disputes the steps in that chain of reasoning, and argues that a higher temperature may be attributable not to a RPM in excess of 1000, but to a heavy load on the vehicle, and in the alternative contends that even if there was a RPM greater than 1000, the speed may not have increased, due to a shift in gear.
The cause of higher than expected temperature readings cannot be ascertained from the record, and we are left with the alternative contentions of the parties. It is up to EPA, however, to support its methodology as reliable, and this requires more than reliance on the unknown, either by speculation, or mere shifting back of the burden of proof.
b. Deterioration factor
Methodological problems also existed with the calculation of the deterioration factor, which took account of possible deterioration in emission quality from 4000 miles to 50,000 miles. Different questions arose as to the calculation of this factor for Ford and Chrysler.
In the case of Ford, the Administrator predicted that emissions would improve from 4000 to 50,000 miles, and arrived at a deterioration factor of less than 1.
In the case of Chrysler, the deterioration factor was also calculated to be less than 1, but this figure was only arrived at after eliminating some data points from the emission measurement on the tested car #333, due to what EPA claimed were unrepresentative points resulting from non-catalyst malfunctions.
Lead adjustment factor
A lead adjustment factor is applied to the deterioration factor, as well as to 4000 mile emissions. EPA estimated on the basis of the questionable Ford dynamometer data, that lead levels had no observable effect, which was contrary to industry testimony on the subject.
3. EPA methodology for General Motors
In the case of General Motors an entirely different methodology from that used for Ford and Chrysler was employed. This was adopted due to limited testing by GM of noble metal catalysts.
The methodology was to take the raw emission values produced by a GM car prior to catalyst treatment of any kind multiplied by a factor representing the efficiency of the catalyst, i. e., the percentage of a given pollutant that the catalyst converts to harmless vapor, in order to obtain the projected overall emission performance at 50,000 miles.
4. Statistical reliability of assumptions
In this case the Administrator is necessarily making a prediction. No tests exist on whether this prediction is or is not reliable. It would, therefore, seem incumbent on the Administrator to estimate the possible degree of error in his prediction. The NAS, for example, said that the data of the manufacturers were subject to ± 20-30% margin of error,
The possibility of error must take into account that only 1 Ford car, 1 Chrysler car, and 1 hypothetical General Motors car form the foundation for predicted conformity with the 1975 standard.
V. CONCLUSION AND DISPOSITION
We may sensibly begin our conclusion with a statement of diffidence.
In this case technical issues permeate the "available technology" determination which the Administrator made the focal point of his decision. In approaching our judicial task we conclude that the requirement of a "reasoned decision" by the Environmental Protection Agency means, in present context, a reasoned presentation of the reliability of a prediction and methodology that is relied upon to overcome a conclusion, of lack of available technology, supported prima faciely by the only actual and observed data available, the manufacturers' testing.
The number of unexplained assumptions used by the Administrator, the variance in methodology from that of the Report of the National Academy of Sciences, and the absence of an indication of the statistical reliability of the prediction, combine to generate grave doubts as to whether technology is available to meet the 1975 statutory standards. We say this, incidentally, without implying or intending any acceptance of petitioners' substitute assumptions. These grave doubts have a legal consequence. This is customarily couched, by legal convention, in terms of "burden of proof." We visualize the problem in less structured terms although the underlying considerations, relating to risk of error, are related. As we see it the issue must be viewed as one of legislative intent. And since there is neither express wording or legislative history on the precise issue, the intent must be imputed. The court must seek to discern and reconstruct what the legislature that enacted the statute would have contemplated for the court's action if it could have been able to foresee the precise situation.
EPA's diligence in this proceeding, fraught with questions of statutory interpretation, technical difficulties and burdensome time constraints placed on the decision-making process, has been commendable. The agency was presented with a prickly task, but has acted expeditiously to carry out what it perceived to be a drastic mandate from Congress. This statute was, indeed, deliberately designed as "shock treatment" to the industry. Our central difference with the Administrator, simply put, stems from our view concerning the Congressional intent underlying the one year suspension provision.
Our decision is also responsive to the differences between the EPA decision and the NAS Report. Although in some instances "the factual findings and technical conclusions"
These factors combine to convince us that, under our view of Congressional intent, we cannot affirm the EPA's denial of suspension as stated. That is not necessarily to assume, as at least some petitioners do, that the EPA's process must be brought to nullity.
The procedures followed in this case, whether or not based on rulings that were "mistaken" when made, have resulted in a record that leaves this court uncertain, at a minimum, whether the essentials of the intention of Congress were achieved. This requires a remand whereby the record as made will be supplemented by further proceedings. In the interest of justice, see 28 U.S.C. § 2106, and mutual regard for Congressional objective, the parties should have opportunity on remand to address themselves to matters not previously put before them by EPA for comment, including material contained in the Technical Appendix filed by EPA in 1972 subsequent to its Decision.
It is contemplated that, in the interest of providing a reasoned decision, the remand proceeding will involve some opportunity for cross-examination. In the remand proceeding — not governed by the same time congestion as the initial Decision process — we require reasonable cross-examination as to new lines of testimony, and as to submissions previously made to EPA in the hearing on a proffer that critical questions could not be satisfactorily pursued by procedures previously in effect. There is, however, still need for expedition, both by virtue of our order and the "lead time" problem, and the EPA may properly confine cross-examination to the essentials, avoiding discursive or repetitive questioning.
Following our suggestion in Environmental Defense Fund, Inc. v. EPA, 150 U.S.App.D.C. 348, 465 F.2d 528 (1972), the Administrator may consider possible use of interim standards short of complete suspension. The statute permits conditioning of suspension on the adoption, by virtue of the information adduced in the suspension proceeding, of
We cannot grant petitioners' request that this court order a suspension since determinations which Congress made necessary conditions of suspension, as to the public interest and good faith, have not been made by the Administrator. The Administrator's decision did not reach these questions and accordingly we must remand for further consideration. The initial requirement that an EPA decision on the suspension, aye or nay, be made within 60 days of the application, obviously does not preclude further consideration following remand by the court. In the interest of justice, 28 U.S.C. § 2106, and the Congressional intention that decisions be made timely in the light of considerations of "lead time" for 1975 model year production, we require the suspension deliberations by EPA to be completed within 60 days. The Administrator's decision on remand must, of course, be consistent with our legal rulings herein — including the need for redefinition of light duty vehicles, and promulgation of an appropriate regulation.
In conformance to the Congressional contemplation of expedition, and our responsibilities as an appellate court, we further require that the Administrator render a decision, on the basis of the best information available, which extends to all the determinations which the statute requires as a condition of suspension.
The case is remanded for further proceedings not inconsistent with this opinion.
BAZELON, Chief Judge (concurring in result):
Socrates said that wisdom is the recognition of how much one does not know.
The court's opinion today centers on a substantive evaluation of the Administrator's assumptions and methodology. I do not have the technical know-how to agree or disagree with that evaluation— at least on the basis of the present record. My grounds for remanding the case rest upon the Administrator's failure to employ a reasonable decision-making process for so critical and complex a matter. At this time I cannot say to what extent I could undertake an evaluation of the Administrator's findings if they were based on an adequate decisional process.
I cannot believe that Congress intended this court to delve into the substance of the mechanical, statistical, and technological disputes in this case. Senator Cooper, the author of the judicial review provision, stated repeatedly that this court's role would be to "determine the question of due process."
The majority's interpretation of the present statute and the administrative precedents would give us no right to establish these procedural guidelines. Their opinion maintains that the strict deadlines in the Clean Air Act preclude any right to challenge the Administrator until after the decision has been made. It indicates that, since this hearing was "rule-making" rather than "adjudicatory", cross-examination and confrontation are not required under traditional rules of administrative law.
I understand this viewpoint, but I do not share it. I do not think the authors of the Clean Air Act intended to put such strict limits on our review of the Administrator's decision-making process. Further, the interests at stake in this case are too important to be resolved on the basis of traditional administrative labels. We recognized two years ago that environmental litigation represents a "new era" in administrative law.
This "new era" does not mean that courts will dig deeper into the technical intricacies of an agency's decision. It means instead that courts will go further in requiring the agency to establish a decision-making process adequate to protect the interests of all "consumers" of the natural environment.
The majority's approach permits the parties to challenge the Administrator's methodology only through the vehicle of judicial review. I do not think this is an adequate substitute for confrontation prior to the decision. I reach this position not only out of concern for fairness to the parties (". . . for if a party first learns of noticed facts through the final report . . . the burden of upsetting a decision announced as final is a heavy one."
It is true that courts occasionally find themselves in the thick of technological controversies—e. g., in patent cases. But those are different circumstances. We do not review patent disputes until they have been through a full panoply of procedures involving full rights of confrontation. Further, unlike our decision in a patent case, our decision on the Administrator's action here is sure to be tested by analysis and challenge in Congress, in the scientific community, and among the public.
My brethren and I are reaching for the same end—a "reasoned decision"— through different means. They would have us examine the substance of the decision before us. There are some areas of administrative law—involving issues of liberty and individual rights—where judges are on firm ground in undertaking a substantive review of agency action. But in cases of great technological complexity, the best way for courts to guard against unreasonable or erroneous administrative decisions is not for the judges themselves to scrutinize the technical merits of each decision. Rather, it is to establish a decision-making process which assures a reasoned decision that can be held up to the scrutiny of the scientific community and the public.
Candor requires the admission that the process of confrontation and challenge might not be possible within the statutory decision period of 60 days. My response would be to permit an extension of the time limit—perhaps 30 days more. This would put less strain on the overall statutory scheme—and on the manufacturers' lead time—than the months that have been expended in litigation, and now a remand, over the decision. Congress did not intend for us to enforce this relatively minor time restriction so strictly as to do major damage to the statute as a whole.
My brethren argue that the 60-day time limit in the statute precluded any opportunity for cross-examination or confrontation at the time of the original decision. But their opinion would apparently permit these procedural rights on the remand. This bit of judicial legerdemain confounds me. I can find nothing in the statute or common sense
Outside of the foregoing differences, I agree with much of the majority opinion. I would have preferred to make the "public interest" factor—the considerations set forth in Part III of that opinion—an independent ground for suspension. The court today deals with the public interest indirectly, through the device of burden of proof. I do not fully understand this approach, but I suspect it leads to essentially the same result I favor.
The words "on the record" are not incorporated into Section 202 (b) (5) (D). Only a "public hearing" is required. Moreover, subsection (iv) of that provision allows consideration by the Administrator of "other information available to him" in reaching a conclusion on "available technology."
As we have stated in an analogous context of rule-making proceedings before the Federal Communications Commission, where petitioners have argued that the Commission was "changing the rules in the middle of the game" when it took into consideration factors not specifically indicated in its Section 4(a) notice under the Administrative Procedure Act, 5 U.S.C. § 1001(a), "[s]urely every time the Commission decided to take account of some additional factor it was not required to start the proceedings all over again. If such were the rule the proceedings might never be terminated." Owensboro On the Air v. United States, 104 U.S.App.D.C. 391, 397, 262 F.2d 702, 708 (1958); Logansport Broadcasting Corp. v. United States, 93 U.S.App.D.C. 342, 346, 210 F.2d 24, 28 (1954).
No application has, however, been made by the Administrator, presumably because his methodology predicts all three manufacturers can meet the 1975 standards. Moreover, there is no evidence on the record to show that converters will perform equally well on different vehicles. This option may be effectively foreclosed as the lead time for production is approached, at which point the companies will be committed to their own individually developed systems.
Since our disposition on remand requires a public interest determination, it disposes of the claim of petitioner Chrysler that the National Environmental Policy Act, 42 U.S.C. § 4321 et seq., requires that an impact statement be filed by the Administrator pursuant to a suspension decision.
The purpose of NEPA is to assure presentation to Congress and the public of the environmental impact of executive action. Here Congress has already decided that the environmental dangers require the statutory standards. The only executive decision is of a one year deferral, and the very stuff of such a decision, at least with a public interest determination, is to assess, inter alia, the environmental consequences of action and inaction. NEPA's objective will be fully served. As we stated in National Resources Defense Council, Inc. v. Morton, 148 U.S.App.D.C. 5, 15, 458 F.2d 827, 837 (1972), the requirements of NEPA should be subject to a "construction of reasonableness." Although we do not reach the question whether EPA is automatically and completely exempt from NEPA, we see little need in requiring a NEPA statement from an agency whose raison d'être is the protection of the environment and whose decision on suspension is necessarily infused with the environmental considerations so pertinent to Congress in designing the statutory framework. To require a "statement," in addition to a decision setting forth the same considerations, would be a legalism carried to the extreme.