United States Steel Corporation v. Russell E. Train, Administrator, United States Environmental Protection Agency Francis T. Mayo, Regional Administrator, Region V, United States Environmental Protection Agency James O. McDonald Director of Enforcement, Region V, United States Environmental Protection Agency and Marvin E. Jones, Administrative Law Judge, United States Environmental Protection Agency, United States Steel Corporation v. United States Environmental Protection Agency

These consolidated cases bring before us an Environmental Protection Agency (EPA) order granting a discharge permit under the Federal Water Pollution Control Act Amendments of 1972 and a related District Court judgment. In No. 76-1616, United States Steel Corporation's petition for review of EPA's order granting a National Pollutant Discharge Elimination System (NPDES) permit for the company's Gary Works pursuant to § 402 of the Act, 33 U.S.C. § 1342, 86 Stat. 880,1 the company challenges the conditions imposed by the permit. No. 76-1425 is an appeal from a District Court's dismissal of a complaint which the company filed while the administrative permit proceeding was still in progress, seeking review of the administrative law judge's refusal to consider certain issues in that proceeding.

The cornerstone of the Act's scheme for cleaning up the nation's waters is § 301(a)'s prohibition against "the discharge of any pollutant by any person" except as specifically permitted by administrative action taken pursuant to specified sections of the Act. An existing source such as the Gary Works may obtain permission to discharge pollutants by applying for an NPDES permit under § 402.3 EPA4 administers the permit program in each state unless and until the state takes over that function, which Indiana did not do in time to process the Gary Works application. A permit, which is issued upon application and after opportunity for a public hearing, states the pollutants and amounts thereof that may be discharged at each of the plant's outfalls, and imposes conditions upon those discharges. A permit thus transforms "generally applicable effluent limitations and other standards including those based on water quality into obligations (including a timetable for compliance) of the individual discharger." EPA v. California ex rel. State Water Resources Control Board, 426 U.S. 200, 205, 96 S.Ct. 2022, 2025, 48 L.Ed.2d 578 (1976).

The Act provides for two kinds of restrictions on the discharge of pollutants. First, federal, technology-based effluent limitations are to be established in two stages, one set to be met by July 1, 1977, and to be based upon "the best practicable control technology currently available" (which we sometimes refer to as "1977 technology" or "BPT"), and the other to be met by July 1, 1983, and to be based on "the best available technology economically achievable." Section 301(b). Second, the states are allowed to impose more stringent limitations, including water quality standards, treatment standards, or schedules of compliance. Sections 301(b)(1)(C) and 510. See also EPA v. California ex rel. State Water Resources Control Board, supra, 426 U.S. at 219, 96 S.Ct. 2022. Congress thus has chosen not to preempt state regulation when the state has decided to force its industry to create new and more effective pollution-control technology.5 These state limitations must also be met by July 1, 1977, § 301(b)(1)(C), and, like the federal limitations, are implemented by conditions which are included in NPDES permits.

In reviewing the U.S. Steel permit we are primarily concerned with the 1977 state and federal limitations. Except with respect to a final limitation on blast-furnace discharges, the additional federal limitations that become effective July 1, 1983 are not involved in this proceeding.

U.S. Steel's Gary Works occupies 3700 acres on the southern shore of Lake Michigan. An integrated steel mill, Gary Works produces coke, iron, steel, and primary and finished steel shapes. The plant draws water from Lake Michigan and each day discharges up to 775 million gallons of polluted water into the lake and into the Grand Calumet River, which flows into the lake. The discharges are made through five outfalls into the lake and 14 into the river.6 Each day the 500 million gallons discharged into the river include an average of 180 pounds of phosphorus, 325 pounds of phenol, 3100 pounds of cyanide, 3400 pounds of flourides, 5100 pounds of ammonia, 82,000 pounds of chlorides, and 180,000 pounds of sulphates. These pollutants eventually flow into lower Lake Michigan.

U.S. Steel's initial application for a discharge permit for its Gary Works was made in 1971, before the adoption of the Federal Water Pollution Control Act Amendments of 1972. That application was submitted to the Army Corps of Engineers, which was charged with the responsibility of issuing permits under the Refuse Act.7 The FWPCA transferred permit authority from the Corps of Engineers to the Administrator of EPA. As provided in § 402(a)(5) of that Act, U.S. Steel's application was treated as an NPDES permit application.

EPA initially issued a permit for the Gary Works in October 1974, after having published notice of its proposed action. The permit contained effluent limitations, monitoring requirements, and additional conditions, together with a compliance schedule. U.S. Steel did not accept the permit but requested an administrative hearing pursuant to EPA regulations, 40 C.F.R. § 125.36. In its request, the company proposed permit conditions which it contended satisfied the Act, some of which would have allowed it to increase the amount of pollutants in its discharges.

After the hearing and a limited remand ordered by EPA, the Regional Administrator substantially approved the conditions contained in the permit, which had been formulated by the Regional Enforcement Division. U.S. Steel appealed, pursuant to 40 C.F.R. § 125.36(n)(1), to the Administrator, who denied review. The permit was reissued by EPA on June 25, 1976, with a modified compliance schedule. U.S. Steel then filed its petition for review in this court.

The permit imposes technology-based limitations governing pH, total suspended solids (TSS), and oil and grease at each individual outfall.8 These limitations are designed to reflect the level of pollutant discharges remaining despite installation of 1977, or best practicable, technology. Throughout the course of the permit proceeding, the parties have agreed that BPT is currently being used by U.S. Steel at all but one outfall. Therefore, the only dispute as to the technology-based limitations on those outfalls is whether the effluent limits established by EPA properly reflect BPT operations.

The one outfall that the parties do not agree on is the iron-making blast-furnace outfall, # 017, which is U.S. Steel's major process-water outfall and the largest single source of pollution at the plant. The permit limitations on TSS at that outfall can be met only by installing a blast-furnace recycling system, which EPA asserts, and U.S. Steel denies, is BPT.

Other permit limitations, imposed because they are required by Indiana regulations, govern six chemicals, viz., ammonia, cyanide, phenol, chloride, sulphate, and fluoride. These limitations apply to the plant's river outfalls as a group and not to individual outfalls. There are also thermal limitations based on state water quality standards.

For all but the blast-furnace outfall, there are only "initial" limitations, which are effective until June 30, 1977, and "final" limitations, which apply from July 1, 1977 until the expiration of the permit on October 31, 1979. The initial limitations govern only pH, TSS, and oil and grease, except that at two outfalls, # 007 and # 017, ammonia, cyanide, and phenol are also covered. The final limitations govern temperature, pH, TSS, and oil and grease for all 19 outfalls and ammonia and other chemicals for the 14 river outfalls, including the blast-furnace outfall. For that outfall the permit also contains an intermediate step, "interim" limitations on total suspended solids, which are effective between July 1, 1977 and June 30, 1979, with the final limitations on TSS becoming effective July 1, 1979. Schedules of compliance are established to enforce these deadlines, and U.S. Steel is required to monitor its discharges in order to present proof of its compliance.

The permit also restricts U.S. Steel's discharges of acid wastes to a deep waste-injection well to their present level. The company is required to monitor these discharges also and to submit data relating to the deep well and the performance of treatability studies of the deep-well wastes.

At the EPA administrative hearing, U.S. Steel attempted to challenge the validity and application of (1) the state water quality standards set out in Indiana regulations SPC 4R and SPC 7R-2; and (2) certain NPDES regulations contained in 40 C.F.R. part 125. The administrative law judge determined that he lacked jurisdiction to decide these matters and therefore refused to consider them at the hearing.

U.S. Steel then filed an action in the United States District Court for the Northern District of Illinois, seeking declaratory and injunctive relief with respect to the issues the administrative law judge had declined to hear. Basing jurisdiction on 28 U.S.C. §§ 1331, 2201, 2202 and the Administrative Procedure Act, 5 U.S.C. § 500, et seq., U.S. Steel asked for the following relief:

(1) An order requiring EPA to determine the validity and applicability of Indiana's water quality standards or, in the alternative, review of those issues by the District Court.

(2) An order requiring EPA to determine the validity of certain "substantive" NPDES regulations or, in the alternative, District Court review of those regulations.

(3) Review by the District Court of certain NPDES regulations pertaining to permit procedures.

U.S. Steel moved for a preliminary injunction to stay the administrative hearing pending the District Court's decision on the merits. Following denial of the motion, an appeal was taken to this court. An application for stay of the administrative proceeding was denied, and after the administrative hearing was completed the appeal was dismissed as moot.

Thereafter the District Court, on EPA's motion, dismissed the complaint as failing to state a claim on which relief could be granted. The court explained its decision in an unreported memorandum, pointing out the inappropriateness of judicial interruption of an ongoing administrative process in the absence of irreparable injury or plain deprivation of constitutional right, the availability of judicial review of the administrative process in accordance with a specific statutory provision, and the general policy of avoiding piecemeal judicial review. U.S. Steel appeals from that judgment of dismissal.III.

There are several procedural issues to be considered in each appeal before reaching the validity of the permit conditions.

(1) Applicability of Administrative Procedure Act

The FWPCA requires the Administrator to provide an "opportunity for public hearing" before issuing a permit, § 402(a)(1). The agency has issued regulations providing for public hearings, held at the discretion of the Regional Administrator, 40 C.F.R. § 125.34, and separate adjudicatory hearings, held at the request of "any interested person" if the Regional Administrator approves, 40 C.F.R. § 125.36. Only an adjudicatory hearing was held on the permit now before us.

The FWPCA does not prescribe the procedures to be followed by the agency at these hearings. The parties disagree as to the applicability of the Administrative Procedure Act.9 EPA has submitted a supplemental brief arguing at length that the adjudication provisions of that Act do not apply and that the only constraint on the agency's procedure is the due process clause.10 The argument is that these sections, 5 U.S.C. § 554, and also 5 U.S.C. §§ 556 and 557, both of which are triggered by § 554,11 apply only to an "adjudication required by statute to be determined on the record after opportunity for agency hearing"; and § 402 of the FWPCA requires only "opportunity for public hearing" and does not contain the words "on the record."

The absence of the words "on the record" is not conclusive, however. See Phillips Petroleum Co. v. FPC, 475 F.2d 842, 851 (10th Cir. 1973), cert. denied, 414 U.S. 1146, 94 S.Ct. 901, 39 L.Ed.2d 102 (1974). Section 509(b)(1) of the FWPCA subjects proceedings under specified sections of the Act to judicial review in a court of appeals. Of the enumerated sections, only § 307, providing for toxic and pretreatment effluent standards, contains the words "on the record." Section 307(a)(2). The presence of these words in one section and their absence from the others is outweighed, however, by other considerations. It seems improbable that Congress would have contemplated that judicial review of proceedings under all the other sections enumerated in § 509(b)(1) would be conducted without a written record. Also pertinent is the language chosen by Congress in § 509(c) making that subsection applicable to "any judicial proceeding" under § 509(b) in which the determination under review is "required to be made on the record after notice and opportunity for hearing." This would have been an unusual way of singling out § 307 from all the sections listed in § 509(b).12 U.S. Steel thus seems to have the better of the argument when it contends that §§ 554, 556, and 557 of the APA are applicable to NPDES permit proceedings.

Sections 556 and 557 are applicable for another reason: § 558(c) of the APA provides, independently of § 554 of that Act, that "(w)hen application is made for a license required by law" the agency shall hold proceedings which shall be "conducted in accordance with sections 556 and 557." Because this is a license application proceeding, §§ 556 and 557 apply whether or not § 554 does.13 In addition, § 706(2)(E) of the APA makes the case subject to the "substantial evidence" standard of judicial review.

The agency also argues that Congress must not have intended the APA to apply to NPDES permit proceedings under the FWPCA because the sheer number of those proceedings would make it impossible to observe the adjudicatory hearing requirements of the APA. On their face, §§ 556 and 557 apply to NPDES permit proceedings. We are not free to ignore the statutory words, which Congress has left unaltered, on grounds of expediency. And while the applicability of § 554 may not be as clear, the impossibility argument is not persuasive in any event. EPA has demonstrated in this case that in the relatively small percentage of cases in which applicants for NPDES permits demand hearings,14 it is not unduly burdensome for the agency to conduct those hearings in compliance with the adjudication provisions of the APA.

(2) Challenges to EPA Procedural Regulations

(a) Burden of Proof

U.S. Steel argues that the EPA regulation which puts the burden of proof on the applicant, 40 C.F.R. § 125.36(i)(1), violates 5 U.S.C. § 556(d), which requires "the proponent of a rule or order" to bear the burden of proof. The short answer to this contention is that U.S. Steel, as the applicant for a permit without which it would be forbidden by law to discharge pollutants, is the proponent. See Appalachian Power Co. v. Train, 545 F.2d 1351, 1358 (4th Cir. 1976).

A related argument is that because the parties were required to submit their evidence simultaneously in writing prior to the hearing, U.S. Steel was "unable to properly prepare to respond to the Government's evidence." Inasmuch as U.S. Steel properly bore the burden of proof, it seems to us that, if anything, it benefited by this procedure. In any event, § 556(d) expressly provides "for the submission of all or part of the evidence in written form" when an agency is considering an application for an initial license, as it was here, and the company neither showed that it was denied the right to offer evidence in rebuttal nor pointed to any prejudice that it suffered.

(b) Failure To Require Hearing Officer To Make Initial Decision

U.S. Steel attacks the EPA regulation which requires the Regional Administrator rather than the hearing officer to render the initial decision. 40 C.F.R. § 125.36(l )(1). This provision is said to violate 5 U.S.C. §§ 554(d) and 557(b). Section 554(d)(A), however, specifically exempts "applications for initial licenses" from the requirement that an agency employee who presides at the hearing make the recommended or initial decision. And § 557(b) states that the hearing officer shall decide the case "unless the agency requires, either in specific cases or by general rule, the entire record to be certified to it for decision." The challenged regulation is such a general rule and is thus authorized by the statute. Moreover, § 557(b)(1) specifically provides that, in "determining applications for initial licenses," the agency itself may issue a tentative decision.

(c) Considerations Outside the Record

U.S. Steel asserts that the following EPA regulation violates 5 U.S.C. § 556(e):

"The Administrator shall decide the matters under review on the basis of the record presented and any other consideration he deems relevant."15

Section 556(e) provides that the "transcript of testimony and exhibits, together with all papers and requests filed in the proceeding, constitutes the exclusive record for decision . . . ." While the regulation might have been more artfully worded, we believe it simply permits the Administrator to use his expertise in making decisions. We do not read it as authorizing him to base his decision on evidence outside the record. In any event, the Administrator did not state in this case that he was basing his decision to deny review on any matter outside the record, and we will not presume that he did so. Cf. 40 C.F.R. § 125.36(n)(9)(ii).

(3) Agency Refusal To Consider Validity of Procedural Regulations

U.S. Steel complains that it should have been allowed, at the administrative hearing, to challenge the EPA procedural regulations governing the permit proceeding. EPA responds that the agency was not required to consider these questions, inasmuch as it had already indicated its view of the matter by adopting the regulations. We think U.S. Steel cannot complain, so long as the validity of the regulations is subject to review by this court.

We have already considered and rejected U.S. Steel's challenges to specific regulations. U.S. Steel also asserts that the regulations in their entirety "are unlawful in that said regulations were improperly promulgated without notice or opportunity for comment. 5 U.S.C. § 553; 'Notice of Proposed Rulemaking,' 30 Fed.Reg.No. 7, January 11, 1973." Without more, we are hardly in a position to evaluate this conclusory argument, to which EPA has not responded. Moreover, U.S. Steel's failure to show that it was prejudiced by the regulations makes further consideration of this argument unnecessary.

(4) Agency Refusal To Consider Validity of Indiana Water Quality Standards

The administrative law judge held that he was without jurisdiction to consider the validity of the Indiana water quality standards upon which certain limitations in the permit were based, a position the Administrator sustained. U.S. Steel contends that Indiana provides no judicial review of the validity of the standards and that due process therefore required the Administrator to determine the validity of those standards.

Under § 402(a)(1) of the FWPCA, the Administrator must condition the NPDES permit upon the discharger's meeting "all applicable requirements under sections 301," et al. Section 301(b)(1)(C) requires compliance by July 1, 1977 with

"any more stringent limitation, including those necessary to meet water quality standards, treatment standards, or schedules of compliance, established pursuant to any State law or regulations (under authority preserved by section 510) . . . ."

Section 510 preserves the right of any state to impose limitations more stringent than the federal limitations under the Act. Because the Administrator is required by the Act to include in the permit any more stringent state limitations, including those necessary to meet state water quality standards, and is given no authority to set aside or modify those limitations in a permit proceeding, he correctly ruled that he had no authority to consider challenges to the validity of the state water quality standards in such a proceeding.

The Administrator's only authority to pass on state water quality standards is conferred by § 303 of the Act, which empowers him to determine whether the standard "meets" or is "consistent with the applicable requirements of this Act." In accordance with that provision he has, in a separate proceeding, considered and approved the applicable Indiana water quality standards. 40 C.F.R. § 120.10. Authority to approve or disapprove a state's identification of polluted waters and calculation of total maximum daily loads is conferred on the Administrator by § 303(d)(2). These determinations are reviewable in an action in the district court under the judicial review provisions of the APA. See note 18, infra.

Assuming that the state standards are consistent with the Act and are not reviewable in the state courts, as U.S. Steel contends they are not,16 the only remaining possible challenge is a federal action against the state officers responsible for their enforcement alleging deprivation of a federal constitutional right. See Part III, B(1), infra.

U.S. Steel relies on Consolidation Coal Co. v. EPA, 537 F.2d 1236 (4th Cir. 1976), which held that when there was no available state procedure for obtaining a hearing on the appropriateness of a state-originated durational limit which was to be included in an NPDES permit pursuant to a § 401(d) certification, due process required that EPA hold such a hearing prior to taking any final administrative action.17 To the extent that Consolidation Coal may be inconsistent with the views we have expressed, we decline to follow it.* As we have already noted, however, a hearing on the validity of the state standards under the United States Constitution would be available in an action against the state officers in the federal district court. That hearing may encompass the issue of whether the procedure by which the state adopted its regulations offended due process.

(5) Procedural and Evidentiary Rulings

We cannot consider vague contentions that there were unspecified " individual errors in procedure which violated either the Administrative Procedure Act . . . or the . . . regulations . . . or both." U.S. Steel's complaint regarding the Regional Administrator's alleged "wholesale verbatim adoption of most of the Staff's proposed findings" is not enough to permit us to conclude that he did not independently review the evidence, nor is its charge that he "complete(ly) fail(ed) to acknowledge contrary evidence." Nor can we review unspecified "clearly erroneous findings of fact and conclusions of law, and the deprivation of Petitioner's right to due process of law." Equally vague is the allegation of

"a course of procedure wherein one party is held strictly accountable to the rules while its opponents are given great leeway and where procedural rules are waived for one side but strictly enforced for the other."

Similarly unspecific are the attacks upon the testimony of the agency's experts as containing opinions they "were either not qualified to give or which were without foundation," or as "unsworn in large part," hearsay, or "legal conclusions." Even apart from the wide latitude allowed an administrative agency in the receipt of evidence, it is impossible for a court to consider general allegations such as these. Challenges to specific conditions of the permit are considered below.

B. The Appeal from the District Court: No. 76-1425

The appeal from the judgment of the District Court dismissing U.S. Steel's action also raises a series of procedural questions, some of which are related to those presented in the petition for review. We deal with these questions in the order in which they are alleged in the three counts of the complaint.

(1) Validity of Indiana Water Quality Standards (Count I)

U.S. Steel argues that the District Court should have required EPA to consider the constitutionality of the Indiana water quality standards. For the reasons stated above, the agency had no authority to consider the validity of those standards, and this relief was therefore properly denied by the District Court.

Nor could the District Court have properly granted U.S. Steel's alternative request that the court itself review the validity of those standards under the United States Constitution. As we have seen, the standards are state, not federal, regulations, and the Administrator was required by the Act to include in the permit any discharge limitations necessary to meet them. While these state regulations, like any other state regulation or statute, can be challenged on federal constitutional grounds in a federal action against the appropriate state officials in a district in which jurisdiction and venue are proper, this was not such an action.

The District Court in this case, however, did have authority to review the Administrator's approval, prior to the permit proceeding, of the Indiana water quality standards as consistent with the FWPCA.18 EPA argues that the complaint did not seek this relief, and we agree. Apart from the mere conclusory assertion that the Indiana standards are contrary to the purposes and provisions of the FWPCA, the complaint did not allege any incompatibility between the state standards and the Act. This claim was therefore insufficient in law.

(2) Validity of EPA Regulations (Counts II and III)

Also properly dismissed was U.S. Steel's claim that the District Court should either have itself held invalid the NPDES substantive and procedural regulations, or ordered EPA to consider their validity in the permit proceeding. As we have already held, this court is the proper forum for challenging those regulations on review of EPA's permit order. We have considered the challenges asserted and found them to be without merit.

We therefore affirm the judgment of the District Court in No. 76-1425, dismissing U.S. Steel's complaint. We now return to the petition for review, No. 76-1616, and consider U.S. Steel's challenges to specific conditions of the permit.

A. Limitations Required by State Law or Regulation

The limitations on the six chemicals, ammonia, cyanide, phenol, chloride, sulphate and fluoride, and the thermal limitations are, as we have seen, state limitations adopted by Indiana pursuant to its plenary power preserved by § 510. They were included in the permit because § 402(a)(1) required the Administrator to condition the discharge permit on compliance with "all applicable requirements" of, inter alia, § 301, and § 301(b)(1)(C) requires dischargers to achieve, in addition to the technology-based effluent limitations determined by EPA, "any more stringent limitation, including those necessary to meet water quality standards . . . established pursuant to any State law or regulation (under authority preserved by Section 510) . . . ."

(1) Chemical Limitations

The limitations for the six chemicals are aggregate weight limits on the total discharges that may be made from all the outfalls at which those chemicals are discharged, which are the river outfalls. The allowable discharges are not allocated among the individual outfalls.19 Compliance, however, is determined by monitoring at each outfall.

In challenging these limitations, U.S. Steel argues that the water quality standards on which certain limitations are based are invalid. As we have held in Parts III, A(4) and III, B(1), supra, however, those standards are not subject to review in either of the appeals presently before us. The company also argues that the limitations on the six chemicals are impossible to achieve with present technology. Even if this is true,20 it does not follow that they are invalid. It is clear from §§ 301 and 510 of the Act, and the legislative history, that the states are free to force technology.21 Although the Indiana Board considered technology in setting some of these limitations, it was not required to do so. Only the federal effluent limitations must be technology-based, and they represent the minimum level of pollution reduction required by the Act. See Leg. Hist., at 1468. If the states wish to achieve better water quality, they may, even at the cost of economic and social dislocations caused by plant closings. See Leg. Hist., at 231, 1282. Cf. Union Electric Co. v. EPA, 427 U.S. 246, 96 S.Ct. 2518, 49 L.Ed.2d 474 (1976). Thus we reject this argument as well.

U.S. Steel also asserts in conclusory terms that the limitations on the six chemicals are not based upon substantial evidence and are arbitrary. If this is intended as an argument that the allocations are more stringent than would be necessary to achieve the water quality standards, it fails for two reasons:

First, notwithstanding EPA's overgenerous concession to the contrary,22 this necessity argument is not available in this proceeding. Section 301(b)(1) (C), the ultimate source of the Administrator's obligation to put the state limitations in the permit, is not limited to restrictions based on water quality standards but extends to "any more stringent limitation" the state adopts pursuant to the authority preserved by § 510. As we read the Act, the Administrator had no more authority to inquire into whether the limitations adopted by the state were necessary to achieve the water quality standards than he did to inquire into the validity of those standards.

Second, even if a necessity argument could be entertained in this proceeding, U.S. Steel has presented its objections in such a general and conclusory way that we doubt such an argument was intended. Assertions that the limitations are "not based upon substantial evidence" and "not supported by accurate data and analysis and sound scientific principles," without elaboration or discussion of the information in the record which is pertinent to each limitation, cannot be considered.23 Ours is an adversary, not an inquisitorial, system. Neither time nor expertise is available to us for searching a voluminous record for error in response to such general assertions as these. The fact that the entire record has not even been brought before us,24 and we therefore could not exclude the possibility of record support for a given limitation in data which were not made available, leads us to believe that these arguments were included in the brief as rhetoric rather than as a serious challenge to the record support for each limitation.25

We accordingly overrule the objections to the limitations on the six chemicals.

(2) Thermal Limitations

The permit also establishes limitations, effective July 1, 1977, on the temperature of the adjacent receiving waters of Lake Michigan and the Grand Calumet River after admixture of the discharges.26 Monitoring requirements of the permit enable EPA to measure U.S. Steel's compliance with the thermal limitations. The limits are taken directly from the Indiana water quality standards applicable to the two bodies of water. The permit offers U.S. Steel an alternative to compliance with these limitations as authorized by § 316(a) of the Act. Under that section, the company may attempt to

"demonstrate to the satisfaction of the Administrator . . . that (the) effluent limitation(s) proposed for the control of the thermal component of (its) discharge . . . (are) more stringent than necessary to assure the projection (sic ) and propagation of a balanced, indigenous population of shellfish, fish, and wildlife in and on (Lake Michigan and/or the Grand Calumet River)."

If the company's showing is successful, EPA may set less stringent thermal limitations, provided they still meet the aquatic-life requirements. U.S. Steel challenges both the thermal limitations and the thermal demonstration provisions of the permit.

U.S. Steel argues that "the thermal limitations in this permit are vague, arbitrary and unreasonable." As effluent limitations based directly on state water quality standards²⁷ and included in the permit pursuant to § 301(b) (1)(C), however, the thermal limitations are not open to substantive challenge in this proceeding. The company's related claim that compliance with the limits cannot be reliably determined must be rejected insofar as it is an objection to the permit's use of temperature as the measurement scale for determining compliance with thermal water quality standards.28 We know of no alternative measurement scale. And, although thermal monitoring is necessarily imprecise, it is possible to determine whether a discharger is in substantial compliance with thermal effluent limitations. The thermal limitations in the permit are therefore upheld.29

U.S. Steel also objects to the "thermal discharge demonstration" provision of the permit, included pursuant to § 316(a), which offers the company an opportunity to demonstrate that the thermal limitations imposed by the permit are more stringent than necessary to protect aquatic life. First, U.S. Steel argues that it is unfair to make such a demonstration "the sole method by which a permittee can obtain relief from improper thermal limitations, (especially) . . . where the permittee is attacking the validity of the thermal limitations themselves." We have held, however, that U.S. Steel cannot challenge the validity of the thermal limitations in this proceeding. The fairness argument must be addressed to the Congress, not this court.

Second, the company argues that the permit improperly applied § 316(a) and its implementing regulations, 40 C.F.R. part 122. See Appalachian Power Co. v. Train, supra, 545 F.2d at 1371-1372