NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Lumber Co., 200 U. S. 321, 337.

SUPREME COURT OF THE UNITED STATES

                 Syllabus

ARKANSAS et al. v. OKLAHOMA et al.
certiorari to the united states court of appeals for
the tenth circuit
No. 90-1262.  Argued December 11, 1991-Decided February 26, 1992

The Clean Water Act provides for two sets of water quality measures:
 effluent limitations, which are promulgated by the Environmental
 Protection Agency (EPA or Agency), and water quality standards,
 which are promulgated by the States.  The Act generally prohibits
 the discharge of effluent into a navigable body of water unless the
 point source obtains a National Pollution Discharge Elimination
 System (NPDES) permit from a State with an EPA-approved permit
 program or from the EPA itself.  A Fayetteville, Arkansas, sewage
 treatment plant received an EPA-issued permit, authorizing it to
 discharge effluent into a stream that ultimately reaches the Illinois
 River upstream from the Oklahoma border.  Respondents, Oklahoma
 and other Oklahoma parties, challenged the permit before the EPA,
 alleging, inter alia, that the discharge violated Oklahoma water
 quality standards, which allow no degradation of water quality in the
 upper Illinois River.  The EPA's Chief Judicial Officer remanded the
 initial affirmance of the permit by the Administrative Law Judge
 (ALJ), ruling that the Act requires an NPDES permit to impose any
 effluent limitations necessary to comply with applicable state water
 quality standards, and that those standards would be violated only
 if the record shows by a preponderance of the evidence that the
 discharge would cause an actual detectable violation of Oklahoma's
 water quality standards.  The ALJ then made detailed findings of
 fact, concluding that Fayetteville had satisfied the Chief Judicial
 Officer's standard, and the Chief Judicial Of sustained the
 permit's issuance.  The Court of Appeals reversed, ruling that the Act
 does not allow a permit to be issued where a proposed source would
 discharge effluent that would contribute to conditions currently
 constituting a violation of applicable water quality standards.  It
 concluded that the Illinois River was already degraded, that the
 Fayetteville effluent would reach the River in Oklahoma, and that
 the effluent would contribute to the River's deterioration even though
 it would not detectably affect the River's water quality.
Held:The EPA's action was authorized by the Clean Water Act.
 Pp.5-22.
   (a)Where interstate discharge is involved, both federal common
 law of nuisance, Milwaukee v. Illinois, 451 U.S. 304, and an affected
 State's common law, International Paper Co. v. Ouellette, 479 U.S.
 481, 493, are pre-empted.  Affected States may not block a permit,
 but must apply to the EPA Administrator, who may disapprove a
 plan if he concludes that the discharge will have an undue impact on
 interstate waters.  Id., at 490-491.  Pp.5-8.
   (b)The EPA has construed the Act as requiring that EPA-issued
 permits comply with the requirements for a permit issued under an
 approved state plan and with 401(a) of the Act, which appears to
 prohibit the issuance of a federal permit over the objection of an
 affected State unless compliance with the affected State's water
 quality requirements can be insured.  Pp.8-11.
   (c)The EPA's requirement that the Fayetteville discharge comply
 with Oklahoma's water quality standards is a reasonable exercise of
 the substantial statutory discretion Congress has vested in the
 Agency.  There is no need to address the question whether the Act
 requires compliance with affected States' standards, for it clearly does
 not limit the EPA's authority to mandate such compliance.  EPA
 regulations, which since 1973 have required that an NPDES permit
 not be issued when compliance with affected States' water quality
 standards cannot be insured, are a reasonable exercise of the Agen-
 cy's discretion and are a well-tailored means of reaching the Act's
 goal of achieving state water quality standards.  The EPA's authority
 is not constrained by the limits in Ouellette, supra, concerning an
 affected State's direct input into the permit process, does not conflict
 with the Act's legislative history and statutory scheme, and is not
 incompatible with the balance among competing policies and interests
 that Congress struck in the Act.  Pp.11-15.
   (d)Contrary to the Court of Appeals' interpretation, nothing in the
 Act mandates a complete ban on discharges into a waterway that is
 in violation of existing water quality standards.  Instead, the Act
 vests in the EPA and the States broad authority to develop long-
 range, area-wide programs to alleviate and eliminate existing pollu-
 tion.  Pp.15-16.
   (e)The Court of Appeals exceeded the legitimate scope of judicial
 review of an agency adjudication when it invalidated the EPA's
 issuance of the permit on the ground that the Agency misinterpreted
 Oklahoma's water quality standards.  It substituted its own reading
 of the law for the EPA's.  Thus, it failed to give substantial deference
 to the Agency's reasonable, consistently held interpretation of its own
 regulations, which incorporate the Oklahoma standards.  It also
 disregarded well-established standards for reviewing factual findings
 of agencies by making its own factual findings when the ALJ's
 findings were supported by substantial evidence.  See generally
 Universal Camera Corp. v. NLRB, 340 U.S. 474.  As a result, the
 court's conclusion that the River's degradation was an important and
 relevant factor which the EPA failed to consider was based on its
 own erroneous interpretation of the controlling law.  Had it been
 properly respectful of the EPA's permissible reading of the Act-that
 what matters is not the River's current status, but whether the
 proposed discharge will have a detectable effect on that status-it
 would not have adjudged the Agency's decision arbitrary and capri-
 cious.  Pp.16-21.
908 F.2d 595, reversed.

 Stevens, J., delivered the opinion for a unanimous Court.
-------------------------------

NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports.  Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash-
ington, D.C. 20543, of any typographical or other formal errors, in order that
corrections may be made before the preliminary print goes to press.

SUPREME COURT OF THE UNITED STATES
                 --------
         Nos. 90-1262 and 90-1266
                 --------
       ARKANSAS, et al., PETITIONERS
90-1262             v.
              OKLAHOMA et al.

     ENVIRONMENTAL PROTECTION AGENCY,
                PETITIONER
90-1266             v.
              OKLAHOMA et al.
on writs of certiorari to the united states court of
       appeals for the tenth circuit
            [February 26, 1992]

  Justice Stevens delivered the opinion of the Court.
  Pursuant to the Clean Water Act, 86 Stat. 816, as
amended, 33  U. S. C. 1251, et seq., the Environmental
Protection Agency (EPA) issued a discharge permit to a new
point source in Arkansas, about 39 miles upstream from the
Oklahoma state line.  The question presented in this
litigation is whether the EPA's finding that discharges from
the new source would not cause a detectable violation of
Oklahoma's water quality standards satisfied the EPA's
duty to protect the interests of the downstream State.
Disagreeing with the Court of Appeals, we hold that the
Agency's action was authorized by the statute.
                     I
  In 1985, the City of Fayetteville, Arkansas, applied to the
EPA, seeking a permit for the City's new sewage treatment
plant under the National Pollution Discharge Elimination
System (NPDES).  After the appropriate procedures, the
EPA, pursuant to 402(a)(1) of the Act, 33 U. S. C.
1342(a)(1), issued a permit authorizing the plant to
discharge up to half of its effluent (to a limit of 6.1 million
gallons per day) into an unnamed stream in northwestern
Arkansas.  That flow passes through a series of three
creeks for about 17 miles, and then enters the Illinois River
at a point 22 miles upstream from the Arkansas-Oklahoma
border.
  The permit imposed specific limitations on the quantity,
content, and character of the discharge and also included a
number of special conditions, including a provision that if
a study then underway indicated that more stringent
limitations were necessary to ensure compliance with
Oklahoma's water quality standards, the permit would be
modified to incorporate those limits.  App. 84.
  Respondents challenged this permit before the EPA,
alleging, inter alia, that the discharge violated the Okla-
homa water quality standards.  Those standards provide
that ``no degradation [of water quality] shall be allowed'' in
the upper Illinois River, including the portion of the River
immediately downstream from the state line.

  Following a hearing, the Administrative Law Judge (ALJ)
concluded that the Oklahoma standards would not be
implicated unless the contested discharge had ``something
more than a mere de minimis impact'' on the State's waters.
He found that the discharge would not have an ``undue
impact'' on Oklahoma's waters and, accordingly, affirmed
the issuance of the permit.  App. to Pet. for Cert. in
No.90-1262, pp. 101a-103a (emphasis deleted).
  On a petition for review, the EPA's Chief Judicial Officer
first ruled that 301(b)(1)(C) of the Clean Water Act
``requires an NPDES permit to impose any effluent limita-
tions necessary to comply with applicable state water
quality standards.''  Id., at 116a-117a.  He then held that
the Act and EPA regulations offered greater protection for
the downstream State than the ALJ's ``undue impact''
standard suggested.  He explained the proper standard as
follows:
     ``[A] mere theoretical impairment of Oklahoma's
   water quality standards-i.e., an infinitesimal impair-
   ment predicted through modeling but not expected to
   be actually detectable or measurable-should not by
   itself block the issuance of the permit.  In this case, the
   permit should be upheld if the record shows by a
   preponderance of the evidence that the authorized
   discharges would not cause an actual detectable viola-
   tion of Oklahoma's water quality standards.''  Id., at
   117a (emphasis in original).
  On remand, the ALJ made detailed findings of fact and
concluded that the City had satisfied the standard set forth
by the Chief Judicial Officer.  Specifically, the ALJ found
that there would be no detectable violation of any of the
components of Oklahoma's water quality standards.  Id., at
127a-143a.  The Chief Judicial Officer sustained the
issuance of the permit.  Id., at 145a-153a.
  Both the petitioners in No. 90-1262 (collectively Arkan-
sas) and the respondents in this litigation sought judicial
review.  Arkansas argued that the Clean Water Act did
not require an Arkansas point source to comply with
Oklahoma's water quality standards.  Oklahoma challenged
the EPA's determination that the Fayetteville discharge
would not produce a detectable violation of the Oklahoma
standards.
  The Court of Appeals did not accept either of these
arguments.  The court agreed with the EPA that the statute
required compliance with Oklahoma's water quality
standards, see 908 F.2d 595, 602-615 (CA10 1990), and did
not disagree with the Agency's determination that the
discharges from the Fayetteville plant would not produce a
detectable violation of the those standards.  Id., at 631-633.
Nevertheless, relying on a theory that neither party had ad-
vanced, the Court of Appeals reversed the Agency's issuance
of the Fayetteville permit.  The court first ruled that the
statute requires that ``where a proposed source would
discharge effluents that would contribute to conditions
currently constituting a violation of applicable water quality
standards, such [aposed source may not be permitted.''
Id., at 620.  Then the court found that the Illinois River in
Oklahoma was ``already degraded,'' that the Fayetteville
effluent would reach the Illinois River in Oklahoma, and
that that effluent could ``be expected to contribute to the
ongoing deterioration of the scenic [Illinois R]iver'' in
Oklahoma even though it would not detectably affect the
River's water quality.  Id., at 621-629.
  The importance and the novelty of the Court of Appeals'
decision persuaded us to grant certiorari.  499 U.S. ___
(1991).  We now reverse.
                    II
  Interstate waters have been a font of controversy since
the founding of the Nation.  E. g., Gibbons v. Ogden, 9
Wheat. 1 (1824).  This Court has frequently resolved
disputes between States that are separated by a common
river, see, e. g., Ohio v. Kentucky, 444 U. S. 335 (1980), that
border the same body of water, see, e. g., New York v. New
Jersey, 256 U. S. 296 (1921), or that are fed by the same
river basin, see, e. g., New Jersey v. New York, 283 U. S.
336 (1931).
  Among these cases are controversies between a State that
introduces pollutants to a waterway and a downstream
State that objects.  See, e. g., Missouri v. Illinois, 200 U. S.
496 (1906). In such cases, this Court has applied principles
of common law tempered by a respect for the sovereignty of
the States.  Compare id., at 521, with Georgia v. Tennessee
Copper Co., 206 U. S. 230, 237 (1907).  In forging what
``may not improperly be called interstate common law,''
Illinois v. Milwaukee, 406 U. S. 91, 105-106 (1972) (Mil-
waukee I), however, we remained aware ``that new federal
laws and new federal regulations may in time pre-empt the
field of federal common law of nuisance.''  Id., at 107.
  In Milwaukee v. Illinois, 451 U. S. 304 (1981) (Milwaukee
II), we held that the 1972 Amendments to the Federal
Water Pollution Control Act did just that.  In addressing
Illinois' claim that Milwaukee's discharges into Lake
Michigan constituted a nuisance, we held that the compre-
hensive regulatory regime created by the 1972 Amendments
pre-empted Illinois' federal common law remedy.  We
observed that Congress had addressed many of the prob-
lems we had identified in Milwaukee I by providing a down-
stream State with an opportunity for a hearing before the
source State's permitting agency, by requiring the latter to
explain its failure to accept any recommendations offered by
the downstream State, and by authorizing the EPA, in its
discretion, to veto a source State's issuance of any permit if
the waters of another State may be affected.  Milwaukee II,
451 U. S., 325-326.
  In Milwaukee II, the Court did not address whether the
1972 Amendments had supplanted state common law
remedies as well as the federal common law remedy.  See
id., at 310, n. 4.  On remand, Illinois argued that 510 of
the Clean Water Act, 33 U. S. C. 1370, expressly pre-
served the State's right to adopt and enforce rules that are
more stringent than federal standards.  The Court of
Appeals accepted Illinois' reading of 510, but held that
that section did ``no more than to save the right and
jurisdiction of a state to regulate activity occurring within
the confines of its boundary waters.''  Illinois v. Milwaukee,
731 F.2d 403, 413 (CA7 1984), cert. denied, 469 U. S. 1196
(1985).
  This Court subsequently endorsed that analysis in
International Paper Co. v. Ouellette, 479 U. S. 481 (1987),
in which Vermont property owners claimed that the
pollution discharged into Lake Champlain by a paper
company located in New York constituted a nuisance under
Vermont law.  The Court held the Clean Water Act taken
``as a whole, its purposes and its history'' pre-empted an
action based on the law of the affected State and that the
only state law applicable to an interstate discharge is ``the
law of the State in which the point source is located.''  Id.,
at 493, 487.  Moreover, in reviewing 402(b) of the Act, the
Court pointed out that when a new permit is being issued
by the source State's permit-granting agency, the down-
stream state
   ``does not have the authority to block the issuance of
   the permit if it is dissatisfied with the proposed
   standards.  An affected State's only recourse is to apply
   to the EPA Administrator, who then has the discretion
   to disapprove the permit if he concludes that the
   discharges will have an undue impact on interstate
   waters.  1342(d)(2). . . . Thus the Act makes it clear
   that affected States occupy a subordinate position to
   source States in the federal regulatory program.''  Id.,
   at 490-491.
  Unlike the foregoing cases, this litigation involves not a
State-issued permit, but a federally issued permit.  To
explain the significance of this distinction, we comment
further on the statutory scheme before addressing the
specific issues raised by the parties.
                    III
  The Clean Water Act anticipates a partnership between
the States and the Federal Government, animated by a
shared objective:  ``to restore and maintain the chemical,
physical, and biological integrity of the Nation's waters.''  33
U. S. C. 1251(a).  Toward this end, the Act provides for
two sets of water quality measures.  ``Effluent limitations''
are promulgated by the EPA and restrict the quantities,
rates, and concentrations of specified substances which are
discharged from point sources.  See 33 U. S. C. 1311,
1314.  ``[W]ater quality standards'' are, in general, promul-
gated by the States and establish the desired condition of
a waterway.  See 33 U. S. C. 1313.  These standards
supplement effluent limitations ``so that numerous point
sources, despite individual compliance with effluent
limitations, may be further regulated to prevent water
quality from falling below acceptable levels.''  EPA v.
California ex rel. State Water Resources Control Board, 426
U. S. 200, 205, n. 12 (1976).
  The EPA provides States with substantial guidance in the
drafting of water quality standards.  See generally 40 CFR
pt. 131 (1991) (setting forth model water quality standards).
Moreover, 303 of the Act requires, inter alia, that state
authorities periodically review water quality standards and
secure the EPA's approval of any revisions in the standards.
If the EPA recommends changes to the standards and the
State fails to comply with that recommendation, the Act
authorizes the EPA to promulgate water quality standards
for the State.  33 U. S. C. 1313(c).
  The primary means for enforcing these limitations and
standards is the National Pollution Discharge Elimination
System (NPDES), enacted in 1972 as a critical part of
Congress' ``complete rewriting'' of federal water pollution
law.  Milwaukee II, 451 U. S., at 317.  Section 301(a) of the
Act, 33 U. S. C. 1311(a), generally prohibits the discharge
of any effluent into a navigable body of water unless the
point source has obtained an NPDES permit.  Section 402
establishes the NPDES permitting regime, and describes
two types of permitting systems:  state permit programs
that must satisfy federal requirements and be approved
by the EPA, and a federal program administered by the
EPA.
  Section 402(b) authorizes each State to establish ``its own
permit program for discharges into navigable waters within
its jurisdiction.''  33 U. S. C. 1342(b).  Among the require-
ments the state program must satisfy are the procedural
protections for downstream States discussed in Ouellette
and Milwaukee II.  See 33 U. S. C. 1342(b)(3), (5).
Although these provisions do not authorize the downstream
State to veto the issuance of a permit for a new point source
in another State, the Administrator retains authority to
block the issuance of any state-issued permit that ``is
outside the guidelines and requirements'' of the Act.  33
U. S. C. 1342(d)(2).
  In the absence of an approved state program, the EPA
may issue an NPDES permit under 402(a) of the Act.  (In
this case, for example, because Arkansas had not been
authorized to issue NPDES permits when the Fayetteville
plant was completed, the permit was issued by the EPA
itself.)  The EPA's permit program is subject to the ``same
terms, conditions, and requirements'' as a state permit
program.  33 U. S. C. 1342(a)(3).  Notwithstanding this
general symmetry, the EPA has construed the Act as
requiring that EPA-issued NPDES permits also comply
with 401(a).  That section, which predates 402 and the
NPDES, applies to a broad category of federal licenses, and
sets forth requirements for ``[a]ny applicant for a Federal
license or permit to conduct any activity including, but not
limited to, the construction or operation of facilities, which
may result in any discharge into the navigable waters.''  33
U. S. C. 1341(a).  Section 401(a)(2) appears to prohibit the
issuance of any federal license or permit over the objection
of an affected State unless compliance with the affected
State's water quality requirements can be insured.
                    IV
  The parties have argued three analytically distinct
questions concerning the interpretation of the Clean Water
Act.  First, does the Act require the EPA, in crafting and
issuing a permit to a point source in one State, to apply the
water quality standards of downstream States?  Second,
even if the Act does not require as much, does the Agency
have the statutory authority to mandate such compliance?
Third, does the Act provide, as the Court of Appeals held,
that once a body of water fails to meet water quality
standards no discharge that yields effluent that reach the
degraded waters will be permitted?
  In this case, it is neither necessary nor prudent for us to
resolve the first of these questions.  In issuing the
Fayetteville permit, the EPA assumed it was obligated by
both the Act and its own regulations to ensure that the
Fayetteville discharge would not violate Oklahoma's
standards.  See App. to Pet. for Cert. in No. 90-1262,
pp.116a-117a, and n.14.  As we discuss below, this
assumption was permissible and reasonable and therefore
there is no need for us to address whether the Act requires
as much.  Moreover, much of the analysis and argument in
the briefs of the parties relies on statutory provisions that
govern not only federal permits issued pursuant to 401(a)
and 402(a), but also state permits issued under 402(b).  It
seems unwise to evaluate those arguments in a case such
as this one, which only involves a federal permit.
  Our decision not to determine at this time the scope of
the Agency's statutory obligations does not affect our
resolution of the second question, which concerns the
Agency's statutory authority.  Even if the Clean Water Act
itself does not require the Fayetteville discharge to comply
with Oklahoma's water quality standards, the statute
clearly does not limit the EPA's authority to mandate such
compliance.
  Since 1973, EPA regulations have provided that an
NPDES permit shall not be issued ``[w]hen the imposition
of conditions cannot ensure compliance with the applicable
water quality requirements of all affected States.''  40
CFR 122.4(d) (1991); see also 38 Fed. Reg. 13533 (1973);
40 CFR 122.44(d) (1991).  Those regulations-relied upon
by the EPA in the issuance of the Fayetteville permit--
constitute a reasonable exercise of the Agency's statutory
authority.
  Congress has vested in the Administrator broad discre-
tion to establish conditions for NPDES permits.  Section
402(a)(2) provides that for EPA-issued permits ``[t]he
Administrator shall prescribe conditions for such permits to
assure compliance with the requirements of [402(a)(1)]
and such other requirements as he deems appropriate.''  33
U. S. C. 1342(a)(2) (emphasis supplied).  Similarly, Con-
gress preserved for the Administrator broad authority to
oversee state permit programs:
     ``No permit shall issue . . . if the Administrator . . .
   objects in writing to the issuance of such permit as
   being outside the guidelines and requirements of this
   chapter.''  33 U. S. C. 1342(d)(2).
  The regulations relied on by the EPA were a perfectly
reasonable exercise of the Agency's statutory discretion.
The application of state water quality standards in the
interstate context is wholly consistent with the Act's broad
purpose, ``to restore and maintain the chemical, physical,
and biological integrity of the Nation's waters.''  33 U. S. C.
1251(a).  Moreover, as noted above, 301(b)(1)(C) express-
ly identifies the achievement of state water quality stan-
dards as one of the Act's central objectives.  The Agency's
regulations conditioning NPDES permits are a well-tailored
means of achieving this goal.
  Notwithstanding this apparent reasonableness, Arkansas
argues that our description in Ouellette of the role of
affected States in the permit process and our characteriza-
tion of the affected States' position as ``subordinate,'' see 479
U. S., at 490-491, indicates that the EPA's application of
the Oklahoma standards was error.  We disagree.  Our
statement in Ouellette concerned only an affected State's
input into the permit process; that input is clearly limited
by the plain language of 402(b).  Limits on an affected
State's direct participation in permitting decisions, however,
do not in any way constrain the EPA's authority to require
a point source to comply with downstream water quality
standards.
  Arkansas also argues that regulations requiring compli-
ance with downstream standards are at odds with the
legislative history of the Act and with the statutory scheme
established by the Act.  Although we agree with Arkansas
that the Act's legislative history indicates that Congress
intended to grant the Administrator discretion in his
oversight of the issuance of NPDES permits, we find
nothing in that history to indicate that Congress intended
to preclude the EPA from establishing a general require-
ment that such permits be conditioned to ensure compliance
with downstream water quality standards.
  Similarly, we agree with Arkansas that in the Clean
Water Act Congress struck a careful balance among
competing policies and interests, but do not find the EPA
regulationcerning the application of downstream water
quality standards at all incompatible with that balance.
Congress, in crafting the Act, protected certain sovereign
interest of the States; for example, 510 allows States to
adopt more demanding pollution-control standards than
those established under the Act.  Arkansas emphasizes
that 510 preserves such state authority only as it is
applied to the waters of the regulating State.  Even
assuming Arkansas's construction of 510 is correct, cf.
id., at 493, that section only concerns state authority and
does not constrain the EPA's authority to promulgate
reasonable regulations requiring point sources in one State
to comply with water quality standards in downstream
States.
  For these reasons, we find the EPA's requirement that
the Fayetteville discharge comply with Oklahoma's water
quality standards to be a reasonable exercise of the
Agency's substantial statutory discretion.  Cf. Chevron
U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467
U. S. 837, 842-845 (1984).
                     V
  The Court of Appeals construed the Clean Water Act to
prohibit any discharge of effluent that would reach waters
already in violation of existing water quality standards.
We find nothing in the Act to support this reading.
  The interpretation of the statute adopted by the court had
not been advanced by any party during the agency or court
proceedings.  Moreover, the Court of Appeals candidly
acknowledged that its theory ``has apparently never before
been addressed by a federal court.''  908 F.2d, at 620, n.39.
The only statutory provision the court cited to support its
legal analysis was 402(h), see id., at 633, which merely
authorizes the EPA (or a state permit program) to prohibit
a publicly owned treatment plant that is violating a
condition of its NPDES permit from accepting any addition-
al pollutants for treatment until the ongoing violation has
been corrected.  See 33 U. S. C. 1342(h).
  Although the Act contains several provisions directing
compliance with state water quality standards, see, e. g., 33
U. S. C. 1311(b)(1)(C), the parties have pointed to nothing
that mandates a complete ban on discharges into a water-
way that is in violation of those standards.  The statute
does, however, contain provisions designed to remedy
existing water quality violations and to allocate the burden
of reducing undesirable discharges between existing sources
and new sources.  See, e. g., 33 U. S. C. 1313(d).  Thus,
rather than establishing the categorical ban announced by
the Court of Appeals-which might frustrate the construc-
tion of new plants that would improve existing condi-
tions-the Clean Water Act vests in the EPA and the States
broad authority to develop long-range, area-wide programs
to alleviate and eliminate existing pollution.  See, e. g., 33
U. S. C. 1288(b)(2).
  To the extent that the Court of Appeals relied on its
interpretation of the Act to reverse the EPA's permitting
decision, that reliance was misplaced.
                    VI
  The Court of Appeals also concluded that the EPA's
issuance of the Fayetteville permit was arbitrary and
capricious because the Agency misinterpreted Oklahoma's
water quality standards.  The primary difference be-
tween the court's and the Agency's interpretation of the
standards derives from the court's construction of the Act.
Contrary to the EPA's interpretation of the Oklahoma
standards, the Court of Appeals read those standards as
containing the same categorical ban on new discharges that
the court had found in the Clean Water Act itself.  Al-
though we do not believe the text of the Oklahoma stan-
dards supports the court's reading (indeed, we note that
Oklahoma itself had not advanced that interpretation in its
briefs in the Court of Appeals), we reject it for a more
fundamental reason-namely, that the Court of Appeals
exceeded the legitimate scope of judicial review of an agency
adjudication.  To emphasize the importance of this point,
we shall first briefly assess the soundness of the EPA's
interpretation and application of the Oklahoma standards
and then comment more specifically on the Court of
Appeals' approach.
  As discussed above, EPA regulations require an NPDES
permit to comply ``with the applicable water quality
requirements of all affected States.''  40 CFR 122.4(d)
(1991).  This regulation effectively incorporates into federal
law those state law standards the Agency reasonably
determines to be ``applicable.''  In such a situation, then,
state water quality standards-promulgated by the States
with substantial guidance from the EPA and approved by
the Agency-are part of the federal law of water pollution
control.
  Two features of the body of law governing water pollution
support this conclusion.  First, as discussed more thorough-
ly above, we have long recognized that interstate water
pollution is controlled by federal law.  See supra, at ___.
Recognizing that the system of federally approved state
standards as applied in the interstate context constitutes
federal law is wholly consistent with this principle.  Second,
treating state standards in interstate controversies as
federal law accords with the Act's purpose of authorizing
the EPA to create and manage a uniform system of inter-
state water pollution regulation.
  Because we recognize that, at least insofar as they affect
the issuance of a permit in another State, the Oklahoma
standards have a federal character, the EPA's reasonable,
consistently held interpretation of those standards is
entitled to substantial deference.  Cf. INS v. National
Center for Immigrants' Rights, 502 U. S. ___ (1991) (slip op.,
at 6); Chevron U.S.A. Inc. v. Natural Resources Defense
Council, Inc., 467 U. S. 837 (1984).  In this case, the Chief
Judicial Officer ruled that the Oklahoma standards-which
require that there be ``no degradation'' of the upper Illinois
River-would only be violated if the discharge effected an
``actually detectable or measurable'' change in water quality.
App. to Pet. for Cert. in No. 90-1262, p.117a.
  This interpretation of the Oklahoma standards is cer-
tainly reasonable and consistent with the purposes and
principles of the Clean Water Act.  As the Chief Judicial
Officer noted, ``unless there is some method for measuring
compliance, there is no way to ensure compliance.''  Id., at
118a, n.16 (internal quotation marks omitted; citation
omitted).  Moreover, this interpretation of the Oklahoma
standards makes eminent sense in the interstate context:
if every discharge that had some theoretical impact on a
downstream State were interpreted as ``degrading'' the
downstream waters, downstream States might wield an
effective veto over upstream discharges.
  The EPA's application of those standards in this case was
also sound.  On remand, the ALJ scrutinized the record and
made explicit factual findings regarding four primary
measures of water quality under the Oklahoma standards:
eutrophication, aesthetics, dissolved oxygen, and
metals.  In each case, the ALJ found that the Fayette-
ville discharge would not lead to a detectable change in
water quality.  He therefore concluded that the Fayetteville
discharge would not violate the Oklahoma water quality
standards.  Because we agree with the Agency's Chief
Judicial Officer that these findings are supported by
substantial evidence, we conclude that the Court of Appeals
should have affirmed both the EPA's construction of the
regulations and the issuance of the Fayetteville permit.
  In its review of the EPA's interpretation and application
of the Oklahoma standards, the Court of Appeals committed
three mutually compounding errors.
  First, the court failed to give due regard to the EPA's
interpretation of its own regulations, as those regulations
incorporate the Oklahoma standards.  Instead the court
voiced its own interpretation of the governing law and
concluded that ``where a proposed source would discharge
effluents that would contribute to conditions currently
constituting a violation of applicable water quality stan-
dards, such [a] proposed source may not be permitted.''  908
F.2d, at 620.  As we have already pointed out, that reading
of the law is not supported by the statute or by any EPA
regulation.  The Court of Appeals sat in review of an agency
action and should have afforded the EPA's interpretation of
the governing law an appropriate level of deference.  See
generally Chevron, supra, at 842-844.
  Second, the court disregarded well-established standards
for reviewing the factual findings of agencies and instead
made its own factual findings.  The troubling nature of the
court's analysis appears on the face of the opinion itself:  at
least four times, the court concluded that ``there was
substantial evidence before the ALJ to support'' particular
findings which the court thought appropriate, but which
were contrary to those actually made by the ALJ.  908 F.2d,
at 620, 625, 627, 629.  Although we have long recognized
the ``substantial evidence'' standard in administrative law,
the court below turned that analysis on its head.  A court
reviewing an agency's adjudicative action should accept the
agency's factual findings if those findings are supported by
substantial evidence on the record as a whole.  See general-
ly Universal Camera Corp. v. NLRB, 340 U. S. 474 (1951).
The court should not supplant the agency's findings merely
by identifying alternative findings that could be supported
by substantial evidence.
  Third, the court incorrectly concluded that the EPA's
decision was arbitrary and capricious.  This error is
derivative of the court's first two errors.  Having substitut-
ed its reading of the governing law for the Agency's, and
having made its own factual findings, the Court of Appeals
concluded that the EPA erred in not considering an impor-
tant and relevant fact-namely, that the upper Illinois
River was (by the court's assessment) already degraded.
  As we have often recognized, an agency ruling is ``arbi-
trary and capricious if the agency has . . . entirely failed to
consider an important aspect of the problem.''  Motor
Vehicle Mfrs. Assn. of United States, Inc. v. State Farm
Mutual Automobile Insurance Co., 463 U. S. 29, 43 (1983).
However, in this case, the degraded status of the River is
only an ``important aspect'' because of the Court of Appeals'
novel and erroneous interpretation of the controlling law.
Under the EPA's interpretation of that law, what matters
is not the River's current status, but rather whether the
proposed discharge will have a ``detectable effect'' on that
status.  If the Court of Appeals had been properly respectful
of the Agency's permissible reading of the Act and the
Oklahoma standards, the court would not have adjudged
the Agency's decision arbitrary and capricious for this
reason.
  In sum, the Court of Appeals made a policy choice that it
was not authorized to make.  Arguably, as that court
suggested, it might be wise to prohibit any discharge into
the Illinois River, even if that discharge would have no
adverse impact on water quality.  But it was surely not
arbitrary for the EPA to conclude-given the benefits to the
River from the increased flow of relatively clean water
and the benefits achieved in Arkansas by allowing the new
plant to operate as designed-that allowing the discharge
would be even wiser.  It is not our role, or that of the Court
of Appeals, to decide which policy choice is the better one,
for it is clear that Congress has entrusted such decisions to
the Environmental Protection Agency.
  Accordingly, the judgment of the Court of Appeals is

                                Reversed.
-------------------------------

