[Federal Register: November 24, 2004 (Volume 69, Number 226)]
[Proposed Rules]
[Page 68443-68565]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr24no04-25]
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Part II
Environmental Protection Agency
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40 CFR Parts 9, 122 et al.
National Pollutant Discharge Elimination System--Proposed Regulations
To Establish Requirements for Cooling Water Intake Structures at Phase
III Facilities; Proposed Rule
[[Page 68444]]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Parts 9, 122, 123, 124, and 125
[OW-2004-0002, FRL-7834-7]
RIN 2040-AD70
National Pollutant Discharge Elimination System--Proposed
Regulations To Establish Requirements for Cooling Water Intake
Structures at Phase III Facilities
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed rule.
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SUMMARY: Today's proposed rule would establish national categorical
requirements under section 316(b) of the Clean Water Act for certain
existing facilities that employ a cooling water intake structure and
are designed to withdraw water above a certain design intake flow from
certain waters of the United States for cooling purposes. Today's
notice proposes three possible options for defining which existing
facilities would be subject to uniform national requirements, based on
design intake flow threshold and source waterbody type: The facility
has a total design intake flow of 50 million gallons per day (MGD) or
more, and withdraws from any waterbody; the facility has a total design
intake flow of 200 MGD or more, and withdraws from any waterbody; or
the facility has a total design intake flow of 100 MGD or more and
withdraws water specifically from an ocean, estuary, tidal river, or
one of the Great Lakes. Because the lowest co-proposed flow threshold
option is 50 MGD, the proposed requirements would only apply to
manufacturing facilities--as power producers with a flow greater than
50 MGD are regulated under the Phase II rule. This proposed rule would
constitute Phase III of EPA's section 316(b) regulation development and
would establish national requirements, and procedures for implementing
those requirements, applicable to the location, design, construction,
and capacity of cooling water intake structures at Phase III
facilities. Today's proposed rule would also establish categorical
section 316(b) requirements for new offshore oil and gas extraction
facilities, which were specifically excluded from the scope of the
Phase I new facility rule so that EPA could gather additional data on
these facilities. The proposed rule would apply to both existing
manufacturers and new offshore oil and gas extraction facilities that
withdraw at least 25 percent of the water exclusively for cooling
purposes.
The proposed national requirements, which would be implemented
through National Pollutant Discharge Elimination System (NPDES)
permits, are based on the best technology available to minimize the
adverse environmental impact associated with the use of cooling water
intake structures. For covered existing facilities, today's proposed
rule would establish performance standards for reducing impingement
mortality by 80 to 95 percent, or impingement mortality by 80 to 95
percent and entrainment by 60 to 90 percent. Today's proposal would
allow existing facilities to select from five compliance alternatives
consistent with those provided in the final Phase II rule for existing
large flow electric power generators. Once finalized and implemented,
the rule would minimize the adverse environmental impact of cooling
water intake structures by reducing the number of aquatic organisms
lost as a result of water withdrawals associated with these structures.
Today's proposed rule does not propose to alter the regulatory
requirements for facilities subject to the Phase I or Phase II
regulations, and EPA is not soliciting comment on those regulations.
EPA is only seeking comment on the proposed regulations for Phase III
existing facilities and new offshore oil and gas facilities, as
reflected in the proposed regulatory text for subparts K and N.
Depending on the options selected in the final section 316(b)
regulation for Phase III facilities, EPA may decide to integrate the
regulatory text for subparts K and N proposed today into the existing
subparts I and J, for purposes of streamlining the number of pages for
publication.
DATES: Comments must be received on or before March 24, 2005.
ADDRESSES: Submit your comments, identified by Docket ID No. OW-2004-
0002, by one of the following methods:
I. Federal eRulemaking Portal: http://www.regulations.gov. Follow
the on-line instructions for submitting comments.
II. Agency Web site: http://www.epa.gov/edocket. EDOCKET, EPA's
electronic public docket and comment system, is EPA's preferred method
for receiving comments. Follow the on-line instructions for submitting
comments.
III. E-mail: OW-Docket@epa.gov.
IV. Mail: Water Docket, Environmental Protection Agency, Mailcode:
4101T, 1200 Pennsylvania Ave., NW., Washington, DC 20460, Attention
Docket ID No. OW-2004-0002. Please include a total of 3 copies. In
addition, please mail a copy of your comments on the information
collection provisions to the Office of Information and Regulatory
Affairs, Office of Management and Budget (OMB), Attn: Desk Officer for
EPA, 725 17th St. NW., Washington, DC 20503.
V. Hand Delivery: Water Docket, EPA Docket Center, EPA West, Room
B102, 1301 Constitution Ave., NW., Washington, DC, Attention Docket ID
No. OW-2004-0002. Such deliveries are only accepted during the Docket's
normal hours of operation, and special arrangements should be made for
deliveries of boxed information.
Instructions: Direct your comments to Docket ID No. OW-2004-0002.
EPA's policy is that all comments received will be included in the
public docket without change and may be made available online at http://www.epa.gov/edocket
, including any personal information provided,
unless the comment includes information claimed to be Confidential
Business Information (CBI) or other information whose disclosure is
restricted by statute. Do not submit information that you consider to
be CBI or otherwise protected through EDOCKET, regulations.gov, or e-
mail. The EPA EDOCKET and the regulations.gov websites are ``anonymous
access'' systems, which means EPA will not know your identity or
contact information unless you provide it in the body of your comment.
If you send an e-mail comment directly to EPA without going through
EDOCKET or regulations.gov, your e-mail address will be automatically
captured and included as part of the comment that is placed in the
public docket and made available on the Internet. If you submit an
electronic comment, EPA recommends that you include your name and other
contact information in the body of your comment and with any disk or
CD-ROM you submit. If EPA cannot read your comment due to technical
difficulties and cannot contact you for clarification, EPA may not be
able to consider your comment. Electronic files should avoid the use of
special characters, any form of encryption, and be free of any defects
or viruses. For additional information about EPA's public docket visit
EDOCKET on-line or see the Federal Register of May 31, 2002 (67 FR
38102). For additional instructions on submitting comments, go to
section B of the SUPPLEMENTARY INFORMATION section of this document.
Docket: All documents in the docket are listed in the EDOCKET index
at http://www.epa.gov/edocket. Although listed in the index, some
information is not publicly available, i.e., CBI or other
[[Page 68445]]
information whose disclosure is restricted by statute. Certain other
material, such as copyrighted material, is not placed on the Internet
and will be publicly available only in hard copy form. Publicly
available docket materials are available either electronically in
EDOCKET or in hard copy at the Water Docket, EPA/DC, EPA West, Room
B102, 1301 Constitution Ave., NW., Washington, DC. The Public Reading
Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday,
excluding legal holidays. The telephone number for the Public Reading
Room is (202) 566-1744, and the telephone number for the Water Docket
is (202) 566-2426.
FOR FURTHER INFORMATION CONTACT: For additional technical information
contact Martha Segall at (202) 566-1041 or Paul Shriner at (202) 566-
1076. For economic information, contact Erik Helm at (202) 566-1066.
For biological information contact Ashley Allen at (202) 566-1012. The
address for the above contacts is: Office of Science and Technology,
Engineering Analysis Division (Mailcode 4303T), Environmental
Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460;
fax number: (202) 566-1053; e-mail address: rule.316b@epa.gov.
SUPPLEMENTARY INFORMATION:
General Information
A. What Entities Are Regulated by This Action?
This proposed rule would apply to ``Phase III existing
facilities''--i.e., certain existing manufacturing and industrial
facilities that are: (1) Point sources; (2) use or propose to use one
or more cooling water intake structures; (3) are designed to withdraw
water above a certain threshold from certain waters of the U.S. (the
flow threshold would differ depending on the regulatory option selected
in the final rule); and (4) use at least 25 percent of water withdrawn
exclusively for cooling purposes. Depending on the regulatory option
selected, the facility would be subject to these national requirements
if it had a design intake flow of: (1) 50 MGD or more from any
waterbody; (2) 200 MGD or more from any waterbody; or (3) 100 MGD or
more from an ocean, estuary, tidal river, or one of the Great Lakes.
This proposed rule would define ``existing facility'' as any
manufacturing or industrial facility that commenced construction on or
before January 17, 2002 (or [60 days from publication of the final
rule] for an offshore oil and gas extraction facility), and any
modification of, or any addition of a unit at such a facility that does
not meet the definition of a new facility at Sec. 125.83.
This proposed rule would also apply to new offshore and coastal oil
and gas extraction facilities, which were specifically excluded from
the Phase I new facility rule. An offshore and coastal oil and gas
extraction facility is new if construction commenced after 60 days from
publication of the final rule. Exhibit 1 provides examples of
industrial facility types potentially regulated by this proposed rule.
Exhibit 1.--Examples of Industrial Facility Types Potentially Regulated by This Proposed Rule
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Examples of potentially regulated Standard industrial North American
Category entities classification codes industry codes (NAIC)
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Federal, State and local Operators of steam electric 4911 and 493.......... 221111, 221112,
government. generating point source 221113, 221119,
dischargers that employ cooling 221121, 221122
water intake structures.
Industry..................... Operators of industrial point See below............. See below
source dischargers that employ
cooling water intake structures..
Agricultural production.......... 0133.................. 111991, 11193
Metal mining..................... 1011.................. 21221
Oil and gas extraction........... 1311, 1321............ 211111, 211112
Mining and quarrying of 1474.................. 212391
nonmetallic minerals.
Food and kindred products........ 2046, 2061, 2062, 311221, 311311,
2063, 2075, 2085. 311312, 311313,
311222, 311225, 31214
Tobacco products................. 2141.................. 312229, 31221
Textile mill products............ 2211.................. 31321
Lumber and wood products, except 2415, 2421, 2436, 2493 321912,321113, 321918,
furniture. 321999, 321212,
321219
Paper and allied products........ 2611, 2621, 2631, 2676 3221, 322121, 32213,
322121, 322122,
32213, 322291
Chemical and allied products..... 28 (except 2895, 2893, 325 (except 325182,
2851, and 2879). 32591, 32551, 32532)
Petroleum refining and related 2911, 2999............ 32411, 324199
industries.
Rubber and miscellaneous plastics 3011, 3069............ 326211, 31332, 326192,
products. 326299
Stone, clay, glass, and concrete 3241.................. 32731
products.
Primary metal industries......... 3312, 3313, 3315, 324199, 331111,
3316, 3317, 3334, 331112, 331492,
3339, 3353, 3363, 331222, 332618,
3365, 3366. 331221, 22121,
331312, 331419,
331315, 331521,
331524, 331525
Fabricated metal products, except 3421, 3499............ 332211, 337215,
machinery and transportation 332117, 332439,
equipment. 33251, 332919,
339914, 332999
Industrial and commercial 3523, 3531............ 333111, 332323,
machinery and computer equipment. 332212, 333922,
22651, 333923, 33312
Transportation equipment......... 3724, 3743, 3764...... 336412, 333911, 33651,
336416
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Measuring, analyzing, and 3861.................. 333315, 325992
controlling instruments;
photographic, medical, and
optical goods; watches and
clocks.
Electric, gas, and sanitary 4911, 4931, 4939, 4961 221111, 221112,
services. 221113, 221119,
221121, 221122,
22121, 22133
Educational services............. 8221.................. 61131
Engineering, accounting, 8731.................. 54171
research, management and related
services.
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This exhibit is not intended to be exhaustive, but rather provides
a guide for readers regarding entities that may be regulated by this
action if they satisfy the final flow threshold and waterbody type
criteria. This exhibit lists the types of entities that EPA is now
aware could potentially be regulated by this action. Other types of
entities not listed in the exhibit could also be regulated. To
determine whether your facility is regulated by this action, you should
carefully examine the applicability criteria in Sec. 125.101 and Sec.
125.131 of this proposal. If you have questions regarding the
applicability of this action to a particular entity, consult the
persons listed for technical information in the FOR FURTHER INFORMATION
CONTACT section.
B. What Should I Consider as I Prepare My Comments for EPA?
1. Submitting Confidential Business Information (CBI). Do not
submit information that you consider to be CBI electronically through
EPA's electronic public docket or by e-mail. Send information claimed
as CBI by mail only to the following address, Office of Science and
Technology, Mailcode 4303T, U.S. Environmental Protection Agency, 1200
Pennsylvania Ave., NW., Washington, DC 20460, Attention: Ahmar Siddiqui
/Docket ID No. OW-2004-0002. You may claim information that you submit
to EPA as CBI by marking any part or all of that information as CBI (if
you submit CBI on disk or CD ROM, mark the outside of the disk or CD
ROM as CBI and then identify electronically within the disk or CD ROM
the specific information that is CBI). Information so marked will not
be disclosed except in accordance with procedures set forth in 40 CFR
Part 2. In addition to one complete version of the comment that
includes any information claimed as CBI, a copy of the comment that
does not contain the information claimed as CBI must be submitted for
inclusion in the public docket and EPA's electronic public docket. If
you submit the copy that does not contain CBI on disk or CD ROM, mark
the outside of the disk or CD ROM clearly that it does not contain CBI.
Information not marked as CBI will be included in the public docket and
EPA's electronic public docket without prior notice. If you have any
questions about CBI or the procedures for claiming CBI, please consult
the person identified in the FOR FURTHER INFORMATION CONTACT section.
2. Tips for Preparing Your Comments. When submitting comments,
remember to:
I. Identify the rulemaking by docket number and other identifying
information (subject heading, Federal Register date and page number).
II. Follow directions--The agency may ask you to respond to
specific questions or organize comments by referencing a Code of
Federal Regulations (CFR) part or section number.
III. Explain why you agree or disagree; suggest alternatives and
substitute language for your requested changes.
IV. Describe any assumptions and provide any technical information
and/or data that you used.
IV. If you estimate potential costs or burdens, explain how you
arrived at your estimate in sufficient detail to allow for it to be
reproduced.
V. Provide specific examples to illustrate your concerns, and
suggest alternatives.
VI. Explain your views as clearly as possible, avoiding the use of
profanity or personal threats.
VII. Make sure to submit your comments by the comment period
deadline identified.
C. Supporting Documentation
The proposed regulation is supported by three major documents:
1. Economic Analysis for the Proposed Section 316(b) Rule for Phase
III Facilities (EPA-821-R-04-016), hereafter referred to as the
Economic Analysis (EA). This document presents the analysis of
compliance costs, closures, energy supply effects, and benefits
associated with the final rule.
2. Regional Benefits Assessment for the Proposed Section 316(b)
Rule for Phase III Facilities (EPA-821-R-04-017), hereafter referred to
as the Regional Analysis Document or the Regional Study(ies) Document.
This document examines cooling water intake structure impacts and
regulatory benefits at the regional level.
3. Technical Development Document for the Proposed Section 316(b)
Rule for Phase III Facilities (EPA-821-R-04-015), hereafter referred to
as the Technical Development Document. This document presents detailed
information on the methods used to develop unit costs and describes the
set of technologies that may be used to meet the final rule's
requirements.
D. Table of Contents
General Information
A. What Entities Are Regulated By This Action?
B. What Should I Consider as I Prepare My Comments for EPA?
C. Supporting Documentation
D. Table of Contents
I. Legal Authority, Purpose, and Background of Today's Regulation
A. Legal Authority
B. Purpose of Today's Proposed Regulation
C. Background
II. Scope and Applicability of the Proposed Rule
A. What is a ``New'' Offshore Oil and Gas Extraction Facility
for Purposes of the Section 316(b) Proposed Phase III Rule?
B. What is an ``Existing Facility'' for Purposes of the Section
316(b) Proposed Phase III Rule?
C. What is ``Cooling Water'' and What is a ``Cooling Water
Intake Structure?''
D. Would My Facility Be Covered if It Withdraws from Waters of
the United States?
E. Would My Facility Be Covered if It is a Point Source
Discharger?
F. What are the Cooling Water Use and Design Intake Flow
Thresholds in this Proposed Rule?
G. When Would a Phase III Existing Facility and New Offshore Oil
and Gas Extraction Facility Be Required to Comply With Any New
316(b) Requirements?
H. What Special Definitions Apply to This Proposal?
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III. Summary of Data Collection Activities
A. Survey Questionnaires
B. Existing Data Sources
C. Data Provided to EPA by Industrial, Trade, Consulting,
Scientific or Environmental Organizations or by the General Public
IV. Overview of Facility Characteristics (Cooling Water Systems &
Intake Structures) for Industries Potentially Subject to Proposed
Rule
A. Overview of Potentially Regulated Phase III Universe
B. Existing Manufacturers and Industrial Facilities Potentially
Subject to Proposed National Requirements
C. New Offshore Oil and Gas Facilities Subject to Proposed
National Requirements
V. Environmental Impacts Associated With Cooling Water Intake
Structures
VI. Basis for the Proposed Requirements
A. What is the Best Technology Available for Minimizing Adverse
Environmental Impact at Phase III Existing Facilities?
B. Economic Practicability
C. What is the Proposed Role of Restoration and Trading?
VII. Implementation
A. When Would the Proposed Rule Become Effective?
B. What General Information Would I Be Required to Submit to the
Director When I Apply for My Reissued NPDES Permit?
C. Phase III Existing Facility Implementation
D. New Offshore Oil and Gas Extraction Facilities
E. What Are the Respective Federal, State, and Tribal Roles?
F. Are Permits for Phase III Facilities Subject to Requirements
Under Other Federal Statutes?
VIII. Economic Impact Analysis
A. Existing Phase III Facilities: Manufacturers and Electric
Power Producers
B. New Offshore Oil and Gas Extraction Facilities
C. Summary of Total Social Costs and Impacts
IX. Benefits Analysis
A. Introduction
B. Study Design and Methods
C. Impingement and Entrainment
D. National Benefits
X. Comparison of Benefits and Costs
A. Benefit-Cost Analysis
B. Break-even Analysis
XI. Statutory and Executive Order Reviews
A. E.O. 12866: Regulatory Planning and Review
B. Paperwork Reduction Act
C. Regulatory Flexibility Act
D. Unfunded Mandates Reform Act
E. Executive Order 13132: Federalism
F. E.O. 13175: Consultation and Coordination With Indian Tribal
Governments
G. E.O. 13045: Protection of Children From Environmental Health
Risks and Safety Risks
H. Executive Order 13211: Actions that Significantly Affect
Energy Supply, Distribution, or Use
I. National Technology Transfer and Advancement Act
J. E.O. 12898: Federal Actions to Address Environmental Justice
in Minority Populations and Low-Income Populations
K. E.O. 13158: Marine Protected Areas
L. Plain Language Directive
I. Legal Authority, Purpose, and Background of Today's Regulation
A. Legal Authority
Today's proposed rule is issued under the authority of sections
101, 301, 304, 306, 308, 316, 401, 402, 501, and 510 of the Clean Water
Act, 33 U.S.C. 1251, 1311, 1314, 1316, 1318, 1326, 1341, 1342, 1361,
and 1370. Publication of this proposed rule fulfills an obligation of
the U.S. Environmental Protection Agency (EPA) under a consent decree
in Riverkeeper, Inc. v. Leavitt, No. 93 Civ. 0314, (S.D.N.Y).
B. Purpose of Today's Proposed Regulation
Section 316(b) of the Clean Water Act provides that any standard
established pursuant to section 301 or 306 of the Clean Water Act and
applicable to a point source must require that the location, design,
construction, and capacity of cooling water intake structures reflect
the best technology available for minimizing adverse environmental
impact. Today's proposed rule would establish requirements reflecting
the best technology available for minimizing adverse environmental
impact, applicable to the location, design, construction, and capacity
of cooling water intake structures at Phase III facilities (Phase I and
Phase II are described in section I. C of today's preamble). Today's
notice proposes the following three possible options for defining which
existing facilities would be subject to categorical national
requirements based on the design intake flow of cooling water intake
structures at a facility and waterbody type: (1) The facility has a
total design intake flow of 50 million gallons per day (MGD) or more
and withdraws from any waterbody; (2) the facility has a total design
intake flow of 200 MGD or more and withdraws from any waterbody; or (3)
the facility has a total design intake flow of 100 MGD or more and
withdraws water specifically from an ocean, estuary, tidal river, or
one of the Great Lakes. Today's notice also proposes a design intake
flow threshold of greater than 2 MGD for new offshore oil and gas
extraction facilities consistent with the design intake flow threshold
for new facilities in the Phase I rule. Under each of these co-proposed
regulatory options, a Phase III facility must use at least 25 percent
of the water withdrawn exclusively for cooling purposes and meet other
specified criteria in order to be within the scope of the rule (see
Section II--Scope and Applicability of Proposed Rule).
C. Background
1. The Clean Water Act
The Federal Water Pollution Control Act, also known as the Clean
Water Act (CWA), 33 U.S.C. 1251 et seq., seeks to ``restore and
maintain the chemical, physical, and biological integrity of the
nation's waters.'' 33 U.S.C. 1251(a). The Clean Water Act establishes a
comprehensive regulatory program, key elements of which are: (1) A
prohibition on the discharge of pollutants from point sources to waters
of the United States, except as authorized by the statute; (2)
authority for EPA or authorized States or Tribes to issue National
Pollutant Discharge Elimination System (NPDES) permits that regulate
the discharge of pollutants; and, (3) requirements for limitations in
NPDES permits based on effluent limitations guidelines and standards
and water quality standards.
Section 316(b) addresses the adverse environmental impact caused by
the intake of cooling water, not discharges into water. Despite this
special focus, the requirements of section 316(b) are closely linked to
several of the core elements of the NPDES permit program established
under section 402 of the Clean Water Act to control discharges of
pollutants into navigable waters. For example, while effluent
limitations apply to the discharge of pollutants by NPDES-permitted
point sources to waters of the United States, section 316(b) applies to
facilities subject to NPDES requirements that withdraw water from
waters of the United States for cooling and that use a cooling water
intake structure to do so.
Section 402 of the Clean Water Act provides authority for EPA or an
authorized State or Tribe to issue an NPDES permit to any person
discharging any pollutant or combination of pollutants from a point
source into waters of the United States. Forty-five States and one U.S.
territory are currently authorized under section 402(b) to administer
the NPDES permitting program. NPDES permits restrict the types and
amounts of pollutants, including heat, that may be discharged from
various industrial, commercial, and other sources of wastewater. These
permits control the discharge of pollutants primarily by requiring
dischargers to meet effluent limitations established pursuant to
section 301 or section 306. Effluent
[[Page 68448]]
limitations may be based on Federal effluent limitations guidelines,
new source performance standards, or the best professional judgment of
the permit writer. Limitations based on these guidelines, standards, or
best professional judgment are known as technology-based effluent
limits. Where technology-based effluent limits are inadequate to ensure
attainment of water quality standards applicable to the receiving
water, section 301(b)(1)(C) of the Clean Water Act requires permits to
include more stringent limits based on applicable water quality
standards. NPDES permits also routinely include monitoring and
reporting requirements, standard conditions, and special conditions. In
addition, NPDES permits contain conditions to implement the
requirements of section 316(b). Section 301 of the Clean Water Act
prohibits the discharge of any pollutant by any person, except in
compliance with specified statutory requirements, including section
402.
Section 510 of the Clean Water Act provides that, except as
provided in the Clean Water Act, nothing in the Act shall preclude or
deny the right of any State or political subdivision thereof to adopt
or enforce any requirement respecting control or abatement of
pollution; except that if a limitation, prohibition or standard of
performance is in effect under the Clean Water Act, such State or
political subdivision may not adopt or enforce any other limitation,
prohibition or standard of performance which is less stringent than the
limitation, prohibition or standard of performance under the Act. EPA
interprets this to reserve for the States authority to implement
requirements that are more stringent than the Federal requirements
under State law. PUD No. 1 of Jefferson County. Washington Dep't of
Ecology, 511 U.S. 700, 705 (1994).
Sections 301, 304, and 306 of the Clean Water Act require that EPA
develop technology-based effluent limitations guidelines and new source
performance standards that are used as the basis for technology-based
minimum discharge requirements in wastewater discharge permits. EPA
issues these effluent limitations guidelines and standards for
categories of industrial dischargers based on the pollutants of concern
discharged by the industry, the degree of control that can be attained
using various levels of pollution control technology, consideration of
economics, as appropriate to each level of control, and other factors
identified in sections 304 and 306 of the Clean Water Act (such as non-
water quality environmental impacts including energy impacts). EPA has
promulgated regulations setting effluent limitations guidelines and
standards under sections 301, 304, and 306 of the Clean Water Act for
more than 50 industries. See 40 CFR 405 through 471. EPA has
established effluent limitations guidelines and standards that apply to
most of the industry categories that use cooling water intake
structures (e.g., steam electric power generation, iron and steel
manufacturing, pulp and paper manufacturing, petroleum refining, and
chemical manufacturing).
Section 316(b) states, in full:
Any standard established pursuant to section 301 or section 306
of [the Clean Water] Act and applicable to a point source shall
require that the location, design, construction, and capacity of
cooling water intake structures reflect the best technology
available for minimizing adverse environmental impact.
The phrase ``best technology available'' in Clean Water Act section
316(b) is not defined in the statute, but its meaning can be understood
in light of similar phrases used elsewhere in the Clean Water Act. See
Riverkeeper v. EPA, slip op. at 11 (2nd Cir. Feb. 3, 2004) (noting that
the cross-reference in Clean Water Act section 316(b) to Clean Water
Act section 306 ``is an invitation to look at section 306 for guidance
in determining what factors Congress intended the EPA to consider in
determining `best technology available' for new sources.'').
In sections 301 and 306, Congress directed EPA to set effluent
discharge standards for new sources based on the ``best available
demonstrated control technology'' and for existing sources based on the
``best available technology economically achievable.'' For new sources,
section 306(b)(1)(B) directs EPA to establish ``standards of
performance.'' The phrase ``standards of performance'' under section
306(a)(1) is defined as being the effluent reduction that is
``achievable through application of the best available demonstrated
control technology, processes, operating methods or other alternatives.
* * *'' This is commonly referred to as ``best available demonstrated
technology'' or ``BADT.'' For existing dischargers, section
301(b)(1)(A) requires the establishment of effluent limitations based
on ``the application of best practicable control technology currently
available.'' This is commonly referred to as ``best practicable
technology'' or ``BPT.'' Further, section 301(b)(2)(A) directs EPA to
establish effluent limitations for certain classes of pollutants
``which shall require the application of the best available technology
economically achievable.'' This is commonly referred to as ``best
available technology'' or ``BAT.'' Section 301 specifies that both BPT
and BAT limitations must reflect determinations made by EPA under Clean
Water Act section 304. Under these provisions, the limitations on the
discharge of pollutants from point sources are based upon the
capabilities of the equipment or ``control technologies'' available to
control those discharges.
The phrases ``best available demonstrated technology'' and ``best
available technology''--like ``best technology available'' in Clean
Water Act section 316(b)--are not defined in the statute. However,
section 304 of the Clean Water Act specifies factors to be considered
in establishing the best practicable control technology currently
available and best available technology.
For best practicable control technology currently available, the
Clean Water Act directs EPA to consider:
the total cost of application of technology in relation to the
effluent reduction benefits to be achieved from such application,
and shall also take into account the age of the equipment and
facilities involved, the process employed, the engineering aspects
of the application of various types of control techniques, process
changes, non-water quality environmental impact (including energy
requirements), and such other factors as [EPA] deems appropriate.
33 U.S.C. 1314(b)(1)(b).
For ``best available technology,'' the Clean Water Act directs EPA
to consider:
the age of equipment and facilities involved, the process employed,
the engineering aspects * * * of various types of control
techniques, process changes, the cost of achieving such effluent
reduction, non-water quality environmental impacts (including energy
requirements), and such other factors as [EPA] deems appropriate.
33 U.S.C. 1314(b)(2)(B).
Section 316(b) expressly refers to section 301, and the phrase
``best technology available'' is very similar to ``best available
technology'' in that section. These facts, coupled with the brevity of
section 316(b) itself, prompted EPA to look to section 301 and,
ultimately, section 304 for guidance in determining the ``best
technology available to minimize adverse environmental impact'' of
cooling water intake structures for existing Phase II facilities.
By the same token, however, there are significant differences
between section 316(b) and sections 301 and 304. See Riverkeeper, Inc.
v. United States Environmental Protection Agency, slip op. at 13 (2nd
Cir. Feb. 3, 2004) (``not every statutory directive contained [in
[[Page 68449]]
sections 301 and 306] is applicable'' to a section 316(b) rulemaking).
Section 316(b) requires that cooling water intake structures reflect
the best technology available for minimizing adverse environmental
impact. In contrast to the effluent limitations provisions, the object
of the ``best technology available'' is explicitly articulated by
reference to the receiving water: To minimize adverse environmental
impact in the waters from which cooling water is withdrawn. This
difference is reflected in EPA's past practices in implementing
sections 301, 304, and 316(b). While EPA has established effluent
limitations guidelines based on the efficacy of one or more
technologies to reduce pollutants in wastewater, considering costs, but
without necessarily considering the impact on the receiving waters, EPA
has previously considered the costs of technologies in relation to the
benefits of minimizing adverse environmental impact in establishing
section 316(b) limits. In Re Public Service Co. of New Hampshire, 10
ERC 1257 (June 17, 1977); In Re Public Service Co. of New Hampshire, 1
EAD 455 (Aug. 4, 1978); Seacoast Anti-Pollution League v. Costle, 597
F. 2d 306 (1st Cir. 1979).
For this Phase III rulemaking, EPA therefore interprets Clean Water
Act section 316(b) as authorizing EPA to consider not only technologies
but also their effects on and benefits to the water from which the
cooling water is withdrawn. Based on these two considerations, today's
proposed rule establishes national requirements for facilities to
install technology, as appropriate, that is technically available,
economically practicable, cost-effective, and justified by the benefits
to the source waterbody.
At this time, EPA is co-proposing all three options discussed above
because it sees advantages to each. EPA is also considering an
alternative under which EPA would not promulgate, at this time,
categorical requirements under section 316(b) for cooling water intake
structures unregulated by Phase I and Phase II. Rather, EPA would
continue to rely on the best professional judgment of the permitting
authority to determine the best technology available to minimize
adverse environmental impact, in order to allow these requirements to
be better tailored to local conditions.
2. Consent Decree
Publication of this proposal fulfills one of EPA's obligations to
comply with a consent decree, as amended. The Second Amended Consent
Decree, which is relevant to today's proposed rule, was filed on
November 25, 2002, in the United States District Court, Southern
District of New York, in Riverkeeper, Inc. v. Leavitt, No. 93 Civ 0314
(AGS). That case was brought against EPA by a coalition of individuals
and environmental groups. The original Consent Decree, filed on October
10, 1995, provided that EPA was to propose regulations implementing
section 316(b) by July 2, 1999, and take final action with respect to
those regulations by August 13, 2001. Under subsequent interim orders,
the Amended Consent Decree filed on November 22, 2000, and the Second
Amended Consent Decree, EPA divided the rulemaking into three phases.
EPA took final action on a rule governing cooling water intake
structures used by new facilities (Phase I) on November 9, 2001 (66 FR
65255, December 18, 2001). EPA took final action on a rule governing
cooling water intake structures used by large existing power producers
(Phase II) on February 16, 2004 (69 FR 41576, July 9, 2004). The
consent decree further requires that EPA propose regulations applicable
to, at a minimum, existing facilities using cooling water intake
structures with intake flows above a minimum threshold to be determined
by EPA, in the following categories: power producers not covered by the
Phase II regulations, pulp and paper manufacturing, petroleum and coal
products manufacturing, chemical and allied products manufacturing, and
primary metal manufacturing (Phase III). EPA is required to propose
regulations for Phase III facilities by November 1, 2004, and take
final action by June 1, 2006.
3. What Other EPA Rulemakings and Guidance Address Cooling Water Intake
Structures?
In April 1976, EPA published a final rule under section 316(b) that
addressed cooling water intake structures. 41 FR 17387 (April 26,
1976), see also the proposed rule at 38 FR 34410 (December 13, 1973).
The rule added a new Sec. 401.14 to 40 CFR Chapter I that reiterated
the requirements of Clean Water Act section 316(b). It also added a new
part 402, which included three sections: (1) Section 402.10
(Applicability), (2) Sec. 402.11 (Specialized definitions), and (3)
Sec. 402.12 (Best technology available for cooling water intake
structures). Section 402.10 stated that the provisions of part 402
applied to ``cooling water intake structures for point sources for
which effluent limitations are established pursuant to section 301 or
standards of performance are established pursuant to section 306 of the
Act.'' Section 402.11 defined the terms ``cooling water intake
structure,'' ``location,'' ``design,'' ``construction,'' ``capacity,''
and ``Development Document.'' Section 402.12 included the following
language:
The information contained in the Development Document shall be
considered in determining whether the location, design,
construction, and capacity of a cooling water intake structure of a
point source subject to standards established under section 301 or
306 reflect the best technology available for minimizing adverse
environmental impact.
In 1977, fifty-eight electric utility companies challenged those
regulations, arguing that EPA had failed to comply with the
requirements of the Administrative Procedure Act (APA) in promulgating
the rule. Specifically, the utilities argued that EPA had neither
published the Development Document in the Federal Register nor properly
incorporated the document into the rule by reference. The United States
Court of Appeals for the Fourth Circuit agreed and, without reaching
the merits of the regulations themselves, remanded the rule.
Appalachian Power Co. v. Train, 566 F.2d 451 (4th Cir. 1977). EPA later
withdrew part 402. 44 FR 32956 (June 7, 1979). The regulation at 40 CFR
401.14, which reiterates the statutory requirement, remains in effect.
Since the Fourth Circuit remanded EPA's section 316(b) regulations
in 1977, NPDES permit authorities have made decisions implementing
section 316(b) on a case-by-case, site-specific basis. EPA published
draft guidance addressing section 316(b) implementation in 1977. See
Draft Guidance for Evaluating the Adverse Impact of Cooling Water
Intake Structures on the Aquatic Environment: Section 316(b) Pub. L.
92-500 (U.S. EPA, 1977). This draft guidance described the studies
recommended for evaluating the impact of cooling water intake
structures on the aquatic environment and recommended a basis for
determining the best technology available for minimizing adverse
environmental impact. The 1977 section 316(b) draft guidance states,
``The environmental-intake interactions in question are highly site-
specific and the decision as to best technology available for intake
design, location, construction, and capacity must be made on a case-by-
case basis.'' (Section 316(b) Draft Guidance, U.S. EPA, 1977, p. 4).
This case-by-case approach was also consistent with the approach
described in the 1976 Development Document referenced in the remanded
regulation.
The 1977 section 316(b) draft guidance suggested a general process
for developing information needed to
[[Page 68450]]
support section 316(b) decisions and presenting that information to the
permitting authority. The process involved the development of a site-
specific study of the environmental effects associated with each
facility that uses one or more cooling water intake structures, as well
as consideration of that study by the permitting authority in
determining whether the facility must make any changes for minimizing
adverse environmental impact. Where adverse environmental impact is
present, the 1977 draft guidance suggested a stepwise approach that
considers screening systems, size, location, capacity, and other
factors.
Although the draft guidance described the information that should
be developed, key factors that should be considered, and a process for
supporting section 316(b) determinations, it did not establish uniform
technology-based national standards for best technology available for
minimizing adverse environmental impact. Rather, the guidance left the
decisions on the appropriate location, design, capacity, and
construction of cooling water intake structures to the permitting
authority. Under this framework, the Director determined whether
appropriate studies have been performed, whether a given facility has
minimized adverse environmental impact, and what, if any, technologies
may be required.
4. Phase I New Facility Rule
On November 9, 2001, EPA took final action on regulations governing
cooling water intake structures at new facilities. 66 FR 65255
(December 18, 2001). On December 26, 2002, EPA made minor changes to
the Phase I regulations. 67 FR 78947. The final Phase I new facility
rule (40 CFR 125, Subpart I) establishes requirements applicable to the
location, design, construction, and capacity of cooling water intake
structures at new facilities that withdraw greater than two (2) million
gallons per day (MGD) and use at least twenty-five (25) percent of the
water they withdraw solely for cooling purposes. In the new facility
rule, EPA adopted a two-track approach. Under Track I, for facilities
with a design intake flow more than 10 MGD, the intake flow of the
cooling water intake structure is restricted, at a minimum, to a level
commensurate with that which could be attained by use of a closed-
cycle, recirculating cooling system. For facilities with a design
intake flow greater than 2 MGD, the design through-screen intake
velocity is restricted to 0.5 feet per second and the total quantity of
intake is restricted to a proportion of the mean annual flow of a
freshwater river or stream, or to maintain the natural thermal
stratification or turnover patterns (where present) of a lake or
reservoir except in cases where the disruption is beneficial, or to a
percentage of the tidal excursions of a tidal river or estuary. If
certain environmental conditions exist, an applicant with intake
capacity greater than 10 MGD must select and implement appropriate
design and construction technologies for minimizing impingement
mortality and entrainment. (Applicants with 2 to 10 MGD flows are not
required to reduce intake flow to a level commensurate with a closed-
cycle, recirculating cooling system, but must install technologies for
reducing entrainment at all locations.) Under Track II, the applicant
has the opportunity to demonstrate to the Director that the
technologies he employs will reduce the level of adverse environmental
impact to a comparable level to what would be achieved by meeting the
Track I requirements for restricting intake flow and velocity. As part
of this demonstration, EPA initially had allowed the applicant to
employ control measures other than reducing impingement mortality and
entrainment, including restoration measures that would result in
increases in fish and shellfish, comparable to the reduction in
impingement mortality and entrainment it would achieve were it to
implement the Track I intake flow and velocity requirements. However,
in February 2004, the 2nd Circuit Court of Appeals issued a decision in
response to several petitions challenging the final Phase I rule. The
Court found that EPA exceeded its authority by allowing new facilities
to comply with section 316(b) through restoration methods, and remanded
that aspect of the rule to EPA. Riverkeeper, Inc. v. EPA, 358 F.3d 174,
191 (2nd Cir., 2004).
Directors may establish less stringent alternative requirements for
a facility if compliance with the Phase I standards would result in
compliance costs wholly out of proportion to those EPA considered in
establishing the requirements at issue or would result in significant
adverse impacts on local air quality, water resources, or local energy
markets.
With the new facility rule, EPA promulgated national minimum
requirements for the location, design, capacity, and construction of
cooling water intake structures at new facilities. The final new
facility rule establishes a reasonable framework that creates certainty
for permitting of new facilities, while providing significant
flexibility to take site-specific factors into account.
EPA specifically excluded new offshore oil and gas extraction
facilities from the Phase I new facility rule, but committed to
consider establishing requirements for such facilities in the Phase III
rulemaking. 66 FR 65338 (December 18, 2001).
5. Phase II Existing Facility Rule
On February 16, 2004, EPA took final action on regulations
governing cooling water intake structures at certain existing power
producing facilities. 69 FR 41576 (July 9, 2004). The final Phase II
rule applies to existing facilities that are point sources; that, as
their primary activity, both generate and transmit electric power or
generate electric power for sale or transmission; that use or propose
to use a cooling water intake structure with a total design intake flow
of 50 MGD or more to withdraw water from waters of the United States;
and that use at least 25 percent of the withdrawn water exclusively for
cooling purposes.
Under the Phase II rule, EPA established performance standards for
the reduction of impingement mortality and, when appropriate,
entrainment (see 40 CFR 125.94). The performance standards consist of
ranges of reductions in impingement mortality and/or entrainment (e.g.,
reduce impingement mortality by 80 to 95 percent and/or entrainment by
60 to 90 percent). These performance standards reflect the best
technology available for minimizing adverse environmental impacts. The
type of performance standard applicable to a particular facility (i.e.,
reductions in impingement mortality only or impingement mortality and
entrainment) is based on several factors, including the facility's
location (i.e., source waterbody), rate of use (capacity utilization
rate), and the proportion of the waterbody withdrawn. In most cases,
EPA believes that these performance standards can be met using design
and construction technologies or operational measures. The performance
standards also can be met, in whole or in part, by using restoration
measures, following consideration of design and construction
technologies or operational measures, and provided such measures meet
certain specified requirements. (See 40 CFR 125.94(c)).
The Phase II rule identifies five alternatives to achieve
compliance with the requirements for best technology available for
minimizing adverse environmental impacts associated with cooling water
intake structures. A facility must demonstrate to the Director one of
the following: (1) That it has already reduced its flow commensurate
with a closed-cycle recirculating system
[[Page 68451]]
(to meet performance standards for impingement and entrainment), or
that it has already reduced its design intake velocity to 0.5 feet per
second or less (to meet the impingement performance standard only); (2)
that its current cooling water intake structure configuration meets the
applicable performance standards; (3) that it has selected design and
construction technologies, operational measures, and/or restoration
measures that, in combination with any existing design and construction
technologies, operational measures, and/or restoration measures, meet
the applicable performance standards; (4) that it meets the
applicability criteria and has installed and is properly operating and
maintaining a rule-specified and/or State-specified approved design and
construction technology (i.e., submerged cylindrical wedgewire screen)
in accordance with 40 CFR 125.99(a) or an alternative technology that
meets the appropriate performance standards and is approved by the
Director in accordance with 40 CFR 125.99(b); or (5) that its costs of
compliance would be significantly greater than the costs considered by
the Administrator for a like facility to meet the applicable
performance standards, or than the benefits of meeting the applicable
performance standards at the facility. A discussion of the legal
authority and basis for the use of the cost test is found in section VI
of this preamble.
During the first permit term and subsequent permit terms, a
facility that chooses compliance alternatives two (2) through five (5),
as described above, may request that compliance with the requirements
of the rule be determined based on the implementation of a Technology
Installation and Operation Plan (TIOP), indicating how the facility
will install and ensure the efficacy, to the extent practicable, of
design and construction technologies and/or operational measures, and/
or a Restoration Plan. Adaptive management practices must be employed
to ensure compliance during subsequent permit terms. The TIOP must be
developed and submitted to the Director in accordance with 40 CFR
125.95(b)(4)(ii). The Restoration Plan must be developed in accordance
with 40 CFR 125.95(b)(5).
6. Public Participation
EPA worked extensively with stakeholders from the industry, public
interest groups, State agencies, and other Federal agencies in the
development of this proposed rule. EPA included industry groups,
environmental groups, and other government entities in the development,
testing, refinement, and completion of the section 316(b) survey, which
was used as a primary source of data for the Phase III proposed rule.
As discussed in section III of today's preamble, the survey,
``Information Collection Request, Detailed Industry Questionnaires:
Phase II Cooling Water Intake Structures & Watershed Case Study Short
Questionnaire,'' was initiated in 1997, and was used to collect data
during 1998. EPA conducted two public meetings on section 316(b)
issues. In June of 1998, EPA conducted a public meeting focused on a
draft regulatory framework for assessing potential adverse
environmental impact from impingement mortality and entrainment. 63 FR
27958 (May 21, 1998). A second public meeting was held in September of
1998, and focused on technology, cost, and mitigation issues. 63 FR
40683 (July 30, 1998). In addition, in September of 1998, and April of
1999, EPA participated in technical workshops sponsored by the Electric
Power Research Institute on issues relating to the definition and
assessment of adverse environmental impact. EPA also participated in
other industry conferences, and has met with representatives of
industry and environmental groups.
In the months leading up to publication of the proposed Phase I
rule, EPA conducted a series of stakeholder meetings to review the
draft regulatory framework for the proposed rule and invited
stakeholders to provide their recommendations. Participants included
representatives of the electric power industry, as well as the
petroleum refining, pulp and paper, and iron and steel industries. EPA
also met with environmental groups, States, and interstate groups.
After publication of the proposed Phase I rule, EPA continued to meet
with stakeholders. Summaries of these meetings are in the docket. EPA
also received many comments on the Phase I proposed rule (65 FR 49059,
August 10, 2000) and Notice of Data Availability (NODA). (66 FR 28853,
May 25, 2001). These comments informed the development of the Phase II
rule and this Phase III proposed rule.
In January 2001, EPA attended technical workshops organized by the
Electric Power Research Institute and the Utilities Water Act Group.
These workshops focused on key issues associated with different
regulatory approaches considered under the Phase I proposed rule and
alternatives for addressing section 316(b) requirements.
On May 23, 2001, EPA held a day-long forum to discuss specific
issues associated with the development of regulations under section
316(b) of the Clean Water Act. 66 FR 20658 (April 24, 2001). At the
meeting, 17 experts from industry, public interest groups, States, and
academia reviewed and discussed the Agency's preliminary data on
cooling water intake structure technologies that are in place at
existing facilities and the costs associated with the use of available
technologies for reducing impingement mortality and entrainment. Over
120 people attended the meeting.
On August 21, 2001, EPA participated in a technical symposium
sponsored by the Electric Power Research Institute in association with
the American Fisheries Society on issues relating to the definition and
assessment of adverse environmental impact under section 316(b) of the
Clean Water Act.
During development of the Phase I and Phase II rules, EPA
coordinated with the Nuclear Regulatory Commission (NRC) to ensure that
there would not be a conflict with NRC safety requirements. NRC
reviewed the proposed Phase II rule and did not identify any apparent
conflict with nuclear plant safety. NRC licensees would continue to be
obligated to meet NRC requirements for design and reliable operation of
cooling systems. NRC recommended that EPA consider adding language
which states that in cases of conflict between an EPA requirement and
an NRC safety requirement, the NRC safety requirement takes precedence.
EPA added language to address this concern in the Phase II final rule
and this proposed rule.
EPA sponsored a Symposium on Cooling Water Intake Technologies to
Protect Aquatic Organisms, on May 6-7, 2003. This symposium brought
together professionals from Federal, State, and Tribal regulatory
agencies; industry; environmental organizations; engineering consulting
firms; science and research organizations; academia; and others
concerned with mitigating harm to the aquatic environment by cooling
water intake structures. Efficacy and costs of various technologies to
mitigate impacts to aquatic organisms from cooling water intake
structures, as well as research and other future needs, were discussed.
During the development of this proposed regulation, EPA met several
times with trade associations whose members would be subject to the
Phase III requirements. EPA also conducted Phase III-specific data
collection activities, including a study of entrainment at
manufacturing facilities, contacting Phase III facilities to request
[[Page 68452]]
biological studies and conducted an industry survey of offshore oil and
gas extraction facilities and seafood processing vessels.
Finally, EPA convened a Small Business Advocacy Review (SBAR) panel
(in accordance with the Regulatory Flexibility Act section 609(b) as
amended by the Small Business Regulatory and Enforcement Fairness Act)
to provide information to small entities and receive feedback during
the Phase III rulemaking process. EPA hosted a pre-panel outreach
meeting for small entities potentially subject to Phase III on January
22, 2004. The SBAR panel held an outreach meeting with small entity
representatives (SERs) on March 16, 2004. Based on the information
gathered from the participating small entities during these outreach
meetings and subsequent correspondence, the SBAR panel produced a final
report to the EPA Administrator on April 27, 2004. Results of the final
report were considered in the development of this proposed Phase III
rule.
These coordination efforts and all of the meetings described in
this section, as well as the comments submitted on the Phase I and II
section 316(b) rules and EPA's response to these comments, are
documented or summarized in the dockets for these three rules. The
Administrative Record for today's proposal includes all materials from
the Phase I, Phase II, and Phase III section 316(b) rule dockets.
II. Scope and Applicability of the Proposed Rule
Based on the co-proposed flow thresholds based options in today's
proposed rule, the proposed national categorical requirements would
apply to two groups of facilities: (1) Existing manufacturing
facilities (including but not limited to chemical, metal, pulp and
paper, and petroleum refining facilities), and (2) new offshore oil and
gas extraction facilities. In today's proposed rule, the term ``new
offshore oil and gas extraction facility'' is defined to include
facilities in both the offshore and the coastal subcategories of EPA's
Oil and Gas Extraction Point Source Category for which effluent
limitations are established at 40 CFR part 435. Although the term
``offshore'' denotes only one of these two subcategories for purposes
of the effluent guidelines, EPA decided that it was more efficient to
use the term ``offshore'' to denote facilities in either subcategory
for purposes of today's rule because the proposed requirements are the
same for both offshore and coastal facilities and the term ``offshore''
is commonly understood to include any facilities not located on land.
EPA requests comment on whether this definition is likely to cause
confusion over the scope of covered facilities. In order to be covered
by today's proposed rule, these facilities would need to use cooling
water intake structures to withdraw water from waters of the U.S. and
meet all other applicability criteria, described below.
Existing facilities that meet all of the following criteria would
be subject to today's proposed rule, if promulgated as proposed (see
Sec. 125.101).
The facility is a point source that has or is required to
have an NPDES permit under section 402 of the Clean Water Act;
The facility is an existing facility not subject to the
Phase II regulation;
The facility uses at least 25 percent of water withdrawn
exclusively for cooling purposes, measured on an average annual basis;
and
The facility uses, or proposes to use, cooling water
intake structures, including a cooling water intake structure operated
by an independent supplier (other than a public water system), with a
total design intake flow equal to or greater than a certain threshold
to withdraw cooling water from waters of the United States.
Today's proposed rule co-proposes three options based on design
intake flow and source waterbody type for defining which existing
facilities are Phase III existing facilities subject to categorical
national requirements:
The facility has a total design intake flow of 50 MGD or
more, and withdraws from any waterbody type (``50 MGD All
Waterbodies'');
The facility has a total design intake flow of 200 MGD or
more, and withdraws from any waterbody type (``200 MGD All
Waterbodies'');
The facility has a total design intake flow of 100 MGD or
more and withdraws water from an ocean, estuary, tidal river, or one of
the Great Lakes (``100 MGD Certain Waterbodies'').
A facility meeting the above criteria, including any flow threshold
EPA adopts after considering comments on the three co-proposed options,
would be referred to as a ``Phase III existing facility.'' If an
existing facility does not meet the relevant Phase II or Phase III
cooling water use and intake flow thresholds by itself, and is co-
located with an existing facility that is not subject to the Phase II
regulation (e.g., a power producing facility below the Phase II flow
threshold, or a manufacturing facility), both facilities would still be
subject to Phase III requirements if the cooling water used
collectively by the co-located facilities meets the applicable
thresholds (and the facilities meet the other requisite Phase III
criteria). Co-located facilities adjoin each other and are under common
ownership, operation, or management. If a facility is a point source
that uses a cooling water intake structure and has, or is required to
have, an NPDES permit, but does not meet the proposed applicable design
intake flow/source waterbody threshold or the 25 percent cooling water
use threshold, it would continue to be subject to permit conditions
implementing CWA section 316(b) set by the permit director on a case-
by-case, best professional judgment basis.
Today's notice also proposes requirements for new offshore oil and
gas extraction facilities, which were specifically excluded from the
Phase I new facility rule. (40 CFR 125 Subpart I). Section II.B of the
preamble discusses what constitutes a ``new'' offshore oil and gas
extraction facility for purposes of the section 316(b) proposed Phase
III rule. Requirements for new offshore oil and gas extraction
facilities are proposed in 40 CFR Subpart N. EPA is seeking comment on
the requirements contained in this subpart. EPA is not seeking comment
on the Phase I rule that EPA promulgated in 2001.
Finally, under today's proposed rule a seafood processing vessel or
an offshore liquefied natural gas import terminal would not be subject
to national categorical requirements. Such a facility could be subject
to permit conditions implementing CWA section 316(b) set by the permit
director on a case-by-case, best professional judgment basis where the
facility is a point source that uses a cooling water intake structure
and has, or is required to have, an NPDES permit.
A. What Is a ``New'' Offshore Oil and Gas Extraction Facility for
Purposes of the Section 316(b) Proposed Phase III Rule?
For purposes of this proposed rule, new offshore oil and gas
extraction facilities are those facilities that are subject to the Oil
and Gas Extraction Point Source Category Effluent Guidelines (i.e., 40
CFR 435.10 Offshore Subcategory or 40 CFR 435.40 Coastal Subcategory);
that commence construction more than 60 days after publication of the
final rule; and that meet all other aspects of the ``new facility''
definition in Sec. 125.83 (other than the date for commencing
construction). In other words, in order to be covered by today's
proposed rule, a new offshore oil and gas extraction facility would
have to be a new source or new discharger per 40 CFR 122.2 and 122.29,
a greenfield or stand-alone
[[Page 68453]]
facility, and use either a newly constructed cooling water intake
structure, or an existing cooling water intake structure whose design
capacity is increased to accommodate the intake of additional cooling
water.
B. What Is an ``Existing Facility'' for Purposes of the Section 316(b)
Proposed Phase III Rule?
In today's proposed rule, the definition of ``existing facility''
is the same as in the Phase II rule except for additional language
addressing new offshore oil and gas extraction facilities: any facility
that commenced construction on or before January 17, 2002 (or 60 days
after publication of the final rule for an offshore oil and gas
extraction facility), as described in 40 CFR 122.29(b)(4).\1\ January
17, 2002 is the effective date of the Phase I new facility rule and,
therefore, the date for distinguishing new facilities from existing
ones. However, offshore oil and gas extraction facilities were not
subject to the Phase I new facility rule, but rather, would be subject
to requirements under this proposed Phase III rule. Therefore, the
effective date of the final Phase III rule would be the date for
distinguishing new offshore oil and gas extraction facilities from
existing ones. An ``existing facility'' under this proposed rule would
include modifications and additions to existing facilities, that do not
meet the definition of a new facility under the Phase I rule (40 CFR
125.83). That definition states:
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\1\ Construction is commenced if the owner or operator has
undertaken certain installation and site preparation activities that
are part of a continuous on-site construction program, and it
includes entering into certain specified binding contractual
obligations as one criterion (40 CFR 122.29(b)(4)).
New facility means any building, structure, facility, or
installation that meets the definition of a ``new source'' or ``new
discharger'' in [other NPDES regulations] and is a greenfield or
stand-alone facility; commences construction after January 17, 2002;
and uses either a newly constructed cooling water intake structure,
or an existing cooling water intake structure whose design capacity
is increased to accommodate the intake of additional cooling water.
New facilities include only ``greenfield'' and ``stand-alone''
facilities. A greenfield facility is a facility that is constructed
at a site at which no other source is located or that totally
replaces the process or production equipment at an existing facility
(see 40 CFR 122.29(b)(1)(i) and (ii)). A stand-alone facility is a
new, separate facility that is constructed on property where an
existing facility is located and whose processes are substantially
independent of the existing facility at the same site (see 40 CFR
122.29(b)(1)(iii). New facility does not include new units that are
added to a facility for purposes of the same general industrial
operation (for example, a new peaking unit at an electrical
generating station).\2\
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\2\ The Phase I rule also listed examples of facilities that
would be ``new'' facilities and facilities that would ``not be
considered a `new facility' '' in two numbered paragraphs. These
read as follows:
``(1) Examples of `new facilities' include, but are not limited
to: the following scenarios:
``(i) A new facility is constructed on a site that has never
been used for industrial or commercial activity. It has a new
cooling water intake structure for its own use.
``(ii) A facility is demolished and another facility is
constructed in its place. The newly-constructed facility uses the
original facility's cooling water intake structure, but modifies it
to increase the design capacity to accommodate the intake of
additional cooling water.
``(iii) A facility is constructed on the same property as an
existing facility, but is a separate and independent industrial
operation. The cooling water intake structure used by the original
facility is modified by constructing a new intake bay for the use of
the newly constructed facility or is otherwise modified to increase
the intake capacity for the new facility.
``(2) Examples of facilities that would not be considered a `new
facility' include, but are not limited to, the following scenarios:
``(i) A facility in commercial or industrial operation is
modified and either continues to use its original cooling water
intake structure or uses a new or modified cooling water intake
structure.
``(ii) A facility has an existing intake structure. Another
facility (a separate and independent industrial operation), is
constructed on the same property and connects to the facility's
cooling water intake structure behind the intake pumps, and the
design capacity of the cooling water intake structure has not been
increased. This facility would not be considered a `new facility'
even if routine maintenance or repairs that do not increase the
design capacity were performed on the intake structure.''
The definition in today's proposed regulation is intended to be
consistent with EPA's definition of new facility in the Phase I rule
(Sec. 125.83) and to ensure that sources excluded from the definition
of new facility in the Phase I rule are captured by the definition of
existing facility.
The determination of whether a facility is ``new'' or ``existing''
is focused on the point source discharger--not on the cooling water
intake structure. In other words, modifications or additions to the
cooling water intake structure (or even the total replacement of an
existing cooling water intake structure with a new one) does not
convert an otherwise unchanged existing facility into a new facility,
regardless of the purpose of such changes. Rather, the determination as
to whether a facility is new or existing focuses on the point source
itself, i.e., whether it is a greenfield facility or a stand-alone
facility.
Under this proposed rule, an existing manufacturing facility that
replaces or modifies an existing generating or manufacturing unit would
remain subject to regulation as a Phase III existing facility, unless
(1) the existing facility were completely demolished and another
facility constructed in its place (a ``greenfield'' facility), or a
separate facility with substantially independent processes were
constructed on the property (a ``stand-alone'' facility) and (2) the
new facility used either a new intake structure or the existing
structure with an increased design capacity. To illustrate, an existing
facility that undertook the following facility modifications or
additions would continue to be characterized as an existing facility--
not a new facility--under today's proposed rule:
An existing manufacturing facility undergoes a
modification of its process short of total replacement of the process
and concurrently increases the design capacity of its existing cooling
water intake structures;
An existing manufacturing facility builds a new process at
its site for purposes of the same industrial operation and concurrently
increases the design capacity of its existing cooling water intake
structures;
An existing manufacturing facility completely rebuilds its
process but uses the existing cooling water intake structure with no
increase in design capacity.
Phase III existing facilities subject to today's proposed rule
would also include point sources that are new users of cooling water
intake structures, but do not meet the definition of new facility under
Sec. 125.83. For example, an existing facility may have historically
withdrawn its cooling water from a municipal or other source, but then
begins to withdraw cooling water from a water of the United States.
This facility would be considered an existing facility because it is
not a ``greenfield'' or ``stand alone'' facility within the meaning of
the new facility rule. Similarly, a facility that previously relied on
unit processes that do not require cooling water, and then adds or
modifies a unit process for purposes of the same industrial operation
such that cooling water is subsequently required, would also be
regulated as an existing facility, not a new facility, under 316(b).
C. What Is ``Cooling Water'' and What Is a ``Cooling Water Intake
Structure?'
Today's proposed rule would adopt for Phase III facilities the same
definition of a ``cooling water intake structure'' that applies to new
facilities under the final Phase I rule and existing facilities under
the final Phase II rule. A cooling water intake structure would be
defined as the total physical structure and any associated constructed
waterways used to withdraw cooling
[[Page 68454]]
water from waters of the Unites States. Under this definition, the
cooling water intake structure extends from the point at which water is
withdrawn from the surface water source up to and including the intake
pumps. Today's proposed rule also would adopt the definition of
``cooling water'' used in the Phase I and Phase II rules: water used
for contact or noncontact cooling, including water used for equipment
cooling, evaporative cooling tower makeup, and dilution of effluent
heat content. The definition specifies that the intended use of cooling
water is to absorb waste heat rejected from the processes used or
auxiliary operations on the facility's premises. The definition also
indicates that water used in a manufacturing process either before or
after it is used for cooling is process water and would not be
considered cooling water for purposes of determining whether the
facility was using 25 percent or more of the water withdrawn for
cooling purposes. This clarification is necessary because cooling water
intake structures typically bring water into a facility for numerous
purposes, including use in industrial processes; use as circulating
water, service water, or evaporative cooling tower makeup water;
dilution of effluent heat content; equipment cooling; and air
conditioning. This is particularly true for manufacturers addressed
under this proposed rule, who often seek to reduce water use and
increase efficiency through water reuse. EPA does not wish to create a
disincentive to such improved efficiency and recognizes that to do so
could result in other forms of environmental impacts. Consequently, and
consistent with the Phase I and Phase II rules, only the water used
exclusively for cooling purposes would be counted when determining
whether the 25 percent threshold in Sec. 125.101(a)(4) or Sec.
125.131(a)(2) is met.
This proposed definition of ``cooling water intake structure''
differs from the definition provided in the 1977 Draft Guidance for
Evaluating the Adverse Impact of Cooling Water Intake Structures on the
Aquatic Environment: Section 316(b) Pub. L. 92-500 (U.S. EPA, 1977).
The proposed rule definition would clarify that the cooling water
intake structure includes the physical structure that extends from the
point at which water is withdrawn from the surface water up to and
including the intake pumps. Inclusion of the term ``associated
constructed waterways'' in today's proposed rule is intended to clarify
that the definition includes those canals, channels, connecting
waterways, and similar structures that may be built or modified to
facilitate the withdrawal of cooling water. The explicit inclusion of
the intake pumps in the definition reflects the key role pumps play in
determining the capacity (i.e., dynamic capacity) of the intake. These
pumps, which bring in water, are an essential component of the cooling
water intake structure since without them the intake structure could
not work as designed.
D. Would My Facility Be Covered if It Withdraws From Waters of the
United States?
The requirements proposed today would apply to cooling water intake
structures that have the design capacity to withdraw amounts of water
equal to or greater than the specified proposed intake flow thresholds
from ``waters of the United States.'' Waters of the United States
include the broad range of surface waters that meet the regulatory
definition at 40 CFR 122.2, which includes lakes, ponds, reservoirs,
nontidal rivers or streams, tidal rivers, estuaries, fjords, oceans,
bays, and coves. These potential sources of cooling water may be
adversely affected by impingement mortality and entrainment.
Some facilities discharge heated water to cooling ponds, then
withdraw water from the ponds for cooling purposes. EPA recognizes that
cooling ponds may, in certain circumstances, constitute part of a
closed-cycled cooling system. See, e.g., Sec. 125.102. However, EPA
does not intend that this proposed rule would change the regulatory
status of cooling ponds. Cooling ponds are neither categorically
included nor categorically excluded from the definition of ``waters of
the United States'' at 40 CFR 122.2. EPA interprets 40 CFR 122.2 to
give permit writers discretion to regulate cooling ponds as ``waters of
the United States'' where cooling ponds meet the definition of ``waters
of the United States.'' The determination of whether a particular
cooling pond is a water of the United States is to be made by the
permit writer on a case-by-case basis, informed by the discussions in
Solid Waste Agency of Northern Cook County (SWANCC) v. U.S. Army Corps
of Engineers, 531 U.S. 159 (2001), and subsequent case law. Therefore,
facilities that withdraw cooling water from cooling ponds that are
waters of the United States and that would meet today's other proposed
criteria for coverage (including the requirement that the facility has
or will be required to obtain an NPDES permit) would be subject to
today's proposed rule. The EPA and the U.S. Army Corps of Engineers
have jointly issued jurisdictional guidance concerning the term
``waters of the United States'' in light of the Supreme Court's
decision in Solid Waste Agency of Northern Cook County v. U.S. Army
Corps of Engineers, 531 U.S. 159 (2001) (SWANCC). A copy of that
guidance was published as an Appendix to an Advanced Notice of Proposed
Rulemaking on the definition of the phrase ``waters of the U.S.,'' see
68 FR 1991 (January 15, 2003), and may be obtained at http://www.epa.gov/owow/wetlands/ANPRM-FR.pdf.
Proposed Sec. 125.101(d) also
provides, similar to the Phase I and Phase II rules, that facilities
that obtain cooling water from a public water system or use treated
effluent are not deemed to be using a cooling water intake structure
for purposes of this proposed rule.
E. Would My Facility Be Covered if It Is a Point Source Discharger?
Today's proposed rule would apply only to facilities that are point
sources (i.e., have an NPDES permit or are required to obtain one)
because they discharge or might discharge pollutants, including storm
water, from a point source to waters of the United States. This is the
same requirement EPA included in the Phase I and Phase II final rules
(see, 40 CFR 125.81(a)(1), and 40 CFR 125.91(a)(1), respectively).
Requirements for complying with section 316(b) will continue to be
applied through NPDES permits.
Based on the Agency's review of potential Phase III facilities that
employ cooling water intake structures, the Agency anticipates that
most Phase III facilities that would be subject to this proposed rule
control the intake structure that supplies them with cooling water, and
discharge some combination of their cooling water, wastewater, and
storm water to a water of the United States through a point source
regulated by an NPDES permit. In this scenario, the requirements for
the cooling water intake structure would be specified in the facility's
NPDES permit. In the event that a Phase III facility's only NPDES
permit is a general permit (e.g., for oil and gas production) or a
general permit for storm water discharges, the Agency anticipates that
the Director may want to write an individual NPDES permit containing
requirements for the facility's cooling water intake structure.
Alternatively, requirements applicable to cooling water intake
structures could be incorporated into general permits. If requirements
are placed into a general permit, they must meet the criteria set out
at 40 CFR 122.28.
The Agency also recognizes that some facilities that have or are
required to have an NPDES permit might not own
[[Page 68455]]
and operate the intake structure that supplies their facility with
cooling water. For example, manufacturing facilities operated by
separate entities might be located on the same, adjacent, or nearby
property(ies); one of these facilities might take in cooling water and
then transfer it to other facilities prior to discharge of the cooling
water to a water of the United States. Proposed Sec. 125.101(c) of
today's proposed rule would address such a situation. It provides that
use of a cooling water intake structure includes obtaining cooling
water by any sort of contract or arrangement with one or more
independent suppliers of cooling water if the supplier withdraws water
from waters of the United States but is not itself subject to
regulations under 316(b). This provision is intended to prevent
facilities from circumventing the requirements of today's proposed rule
by creating arrangements to receive cooling water from an entity that
is not itself subject to national categorical requirements (e.g., a
facility that is not a point source).
For facilities that have or are required to have NPDES permits that
do not directly control the intake structures that supply their
facilities with cooling water, proposed Sec. 125.101(d) also provides,
similar to the Phase I and II rules, that facilities that obtain
cooling water from a public water system or use treated effluent are
not deemed to be using a cooling water intake structure for purposes of
this proposed rule.
As stated in the preamble to the final Phase I rule (66 FR 65256,
December 18, 2001), the Agency would encourage the Director to closely
examine scenarios in which a facility withdraws significant amounts of
cooling water from waters of the United States but is not required to
obtain an NPDES permit. As appropriate, under this proposed rule, the
Director would apply other legal requirements, such as section 404 or
401 of the Clean Water Act, the Coastal Zone Management Act, the
National Environmental Policy Act, the Endangered Species Act, or
similar State or Tribal authorities to address adverse environmental
impact caused by cooling water intake structures at those facilities.
F. What Are the Cooling Water Use and Design Intake Flow Thresholds in
This Proposed Rule?
This proposed rule would apply to existing facilities that meet the
following thresholds: (1) Use at least twenty-five (25) percent of the
water withdrawn exclusively for cooling purposes (measured on an
average annual basis), and (2) have a total design intake flow equal to
or greater than one of the three proposed thresholds , but are not
subject to the Phase II rule. As previously discussed, EPA is proposing
three possible flow threshold-based options in today's proposed rule
(i.e., 50 MGD, 200 MGD, and 100 MGD \3\). The facility would also have
to meet the other applicability criteria defined in Sec. 125.101.
---------------------------------------------------------------------------
\3\ Note: the 100 MGD flow threshold also specifies withdrawal
from certain source waterbody types. The other proposed flow
thresholds are not linked to source waterbody types.
---------------------------------------------------------------------------
The 25 percent exclusive cooling use threshold is the same as
employed in the Phase I and II regulations. As in the Phase I and Phase
II rules, water used for both cooling and non-cooling purposes would
not count towards the 25 percent threshold. Thus, the proposed rule
would not discourage the reuse of cooling water as process water or
vice versa. Water that serves as cooling water but is either previously
or subsequently used as process water would not be considered cooling
water for purposes of determining whether the 25 percent threshold is
met. Water withdrawn for non-cooling purposes would include water
withdrawn for warming by liquified natural gas facilities, water used
to power hydro-electric plants, and water withdrawn for public water
systems by desalinization facilities.
Today's notice proposes three different options for defining which
existing facilities are Phase III existing facilities subject to
categorical national requirements. These options include existing
facilities having a total design intake flow of: 50 MGD or more; 200
MGD or more; or 100 MGD or more if the facility withdraws water from an
ocean, tidal river, estuary, or Great Lake. EPA is co-proposing these
options because EPA believes that all three reflect potentially viable
alternatives for balancing the many factors EPA considers in
establishing best technology available for minimizing adverse
environmental impact. These factors include the percentage of cooling
water flow subject to national requirements, costs, benefits, cost-
effectiveness, permitting burden and the need for flexibility in
implementation, projected closures, and potential impacts on small
businesses. Each of these factors are permissible for consideration
under the CWA and each of these co-proposed options will fulfill CWA
requirements. For example, considerations of costs, benefits,
economically practicability and cost-effectiveness are appropriate
factors under CWA sections 301 and 304 (e.g., see discussion of Agency
authority in section I). In addition, EPA is required to consider small
business impacts under the Regulatory Flexibility Act as amended by the
Small Business Regulatory Enforcement Fairness Act. Accordingly, the
discussion below focuses on the relative advantages and disadvantages
of these co-proposed options and the proposed regulatory language
reflects all three options.
i. Total Design Intake Flow of 50 MGD or More
Under this co-proposed option, facilities with a design intake flow
of 50 MGD or greater, and that meet the other criteria in Sec.
125.101, would be subject to the performance standards and compliance
alternatives proposed in today's rule discussed below. Under this
option, section 316(b) permit conditions for existing facilities with a
design intake flow of less than 50 MGD would continue to be established
on a case-by-case, best professional judgment basis.
EPA is co-proposing the 50 MGD threshold based on several factors.
With a 50 MGD flow threshold, the proposed rule would regulate 75
percent of the design intake capacity, and 23 percent of the facilities
(155 facilities) potentially covered by the Phase III rule,\4\ thus
subjecting the majority of design intake flows potentially included
within the scope of the Phase III existing facility rule to national
performance requirements. Use of a 50 MGD threshold would focus
national section 316(b) requirements on those Phase III existing
facilities with moderate to large design intake flows. These facilities
pose a greater potential for causing significant adverse environmental
impacts than those withdrawing less than 50 MGD. Assuming full
implementation of the Phase II rule and today's proposed rule, at the
co-proposed 50 MGD threshold, section 316(b) program requirements would
regulate more than 97 percent of the total cooling water withdrawals
associated with existing facilities. In addition, EPA estimates that
use of a 50 MGD threshold would avoid facility closures under this
proposed rule, and would reduce the cost of the proposed rule to
permittees compared with the costs of a lower threshold.
---------------------------------------------------------------------------
\4\ Facilities ``potentially covered by the Phase III rule''
include all existing manufacturing and power producing facilities
greater than 2 MGD that were not covered by the Phase II rule. There
are an estimated 683 manufacturing and electric generating
facilities (survey weighted) potentially covered by the Phase III
rule, with a total design intake flow of 40,441 MGD.
---------------------------------------------------------------------------
[[Page 68456]]
EPA estimates this option would cost $47.3 to $50.1 million \5\ or
$348,000 to $368,000 on average annually per facility. Quantified
benefits are $1.5 million to $1.9 million (annualized use value).
Because this option covers the most facilities, it may also have the
greatest ecological protection benefits, which EPA was not able to
quantify. EPA estimates that this option would provide the highest
quantified and monetized benefits of the co-proposed options but would
also have the highest annualized costs, resulting in the lowest
quantified benefits-to-cost ratio and the lowest (greatest negative)
quantified net benefits among these options. See section X of this
preamble for further discussion of benefits and costs.
---------------------------------------------------------------------------
\5\ Unless otherwise noted, cost and benefit ranges reflect the
use of alternative discount rates (3% and 7%) in annualized 2003
dollars.
---------------------------------------------------------------------------
Finally, the co-proposed 50 MGD threshold would exclude small
businesses from national rule requirements. This is consistent with the
recommendations of the Small Business Advocacy Review Panel final
report that EPA analyze a range of potential thresholds, particularly
those between 20 MGD and 50 MGD, as a means of reducing potential
economic impacts on small businesses while still achieving desired
environmental benefits under the rule. See section XI.C for additional
information. EPA estimates that setting an applicability threshold at
50 MGD would exclude all existing small entities potentially subject to
the Phase III rule.
ii. Total Design Intake Flow of 200 MGD or More
Under this co-proposed option, facilities with a design intake flow
of 200 MGD or greater and that meet the other criteria in Sec.
125.101, would be subject to the performance standards and compliance
alternatives proposed in today's notice and discussed above. Under this
option, section 316(b) permit conditions for existing facilities not
covered under the Phase II rule, with a design intake flow of less than
200 MGD, would continue to be established on a case-by-case, best
professional judgment basis.
EPA is co-proposing the 200 MGD threshold based on several factors.
With a 200 MGD flow threshold, the proposed rule would regulate 45
percent of the design intake capacity and approximately 5% of the
facilities potentially covered by the Phase III rule. Assuming full
implementation of the Phase II rule and today's proposed rule, at the
co-proposed 200 MGD threshold, section 316(b) program requirements
would regulate more than 94 percent of the total cooling water
withdrawals associated with existing facilities withdrawing greater
than 2 MGD.
EPA estimates this option would cost $22.8 to $24.1 million or
$912,000 to $964,000 on average annually per facility. Quantified
benefits are $0.98 to $1.26 million (annualized use value). The option
would have a higher benefit-to-cost ratio yielding 66 percent of the
quantified benefits at 48% of the costs and greater (lower negative)
quantified net benefits compared to the 50 MGD option.
EPA estimates that use of a 200 MGD threshold would avoid facility
closures under this proposed rule and would exclude all existing small
entities.
iii. Facility Has a Total Design Intake Flow of 100 MGD or More and
Withdraws Water From an Ocean, Tidal River, Estuary, or Great Lake
Under this co-proposed option, facilities located on estuaries,
oceans, tidal rivers or streams, or one of the Great Lakes, with a
design intake flow of 100 MGD or greater, and that meet the other
criteria in Sec. 125.101, would be subject to the performance
standards and compliance alternatives proposed in today's rule and
discussed below. Under this regulatory option, section 316(b) permit
conditions for all existing facilities not covered under the Phase II
rule, and located on freshwater rivers and streams or lakes and
reservoirs, or with a design intake flow of less than 100 MGD would
continue to be established on a case-by-case, best professional
judgment basis.
Under this co-proposed option, 4 percent of the facilities
potentially subject to regulation under Phase III would be subject to
national requirements, and 18 percent of total design intake capacity
associated with potential Phase III facilities would be addressed by
such national requirements. Assuming full implementation of the Phase
II rule and today's proposed rule, at the co-proposed 100 MGD
threshold, section 316(b) program requirements would regulate more than
91 percent of the total cooling water withdrawals associated with
existing facilities.
EPA estimates this option would cost $17.6 to $18.2 million or
$926,000 to $958,000 on average annually per facility. Quantified
benefits are $1.1 to 1.4 million (annualized use value). EPA estimates
that this option would provide the second highest quantified benefits
of the co-proposed options, and would have the lowest annualized costs
when compared with the other two options, resulting in the highest
quantified benefits-to-costs ratio and highest (least negative)
quantified net benefits among the three options. This option would
provide about 75 percent of the quantified benefits of the 50 MGD flow
threshold option at about 36 percent of the cost by focusing the rule
requirements on the most sensitive waterbodies.
EPA estimates that use of a 100 MGD threshold would avoid facility
closures under this proposed rule and would exclude all existing small
entities.
EPA requests comment on all aspects of each of these co-proposed
options, including whether lower (e.g., 20 MGD) or higher (e.g., 250
MGD) thresholds should be considered, as well as whether different
conditions (e.g., related to waterbody type) should be combined with
these or other thresholds. EPA also solicits comment on the resource
implications for State permitting agencies associated with each of
these options.
G. When Would a Phase III Existing Facility and New Offshore Oil and
Gas Extraction Facility Be Required To Comply With Any New 316(b)
Requirements?
If EPA were to promulgate today's proposed rule, the final rule
would become effective sixty (60) days after the date of publication in
the Federal Register. After the effective date of any such final
regulation, existing manufacturers and new offshore oil and gas
extraction Phase III facilities, including existing facilities not
currently subject to cooling water intake requirements under 40 CFR
125, would need to comply when an NPDES permit containing requirements
consistent with the final rule is issued to the facility (see Sec.
125.100 and Sec. 125.132). Under current NPDES program regulations,
this will occur when a new NPDES permit is issued or when an existing
NPDES permit is issued, reissued, or modified or revoked and reissued.
As in Phase II, the proposed rule for Phase III existing facilities
includes special provisions to allow sufficient time to complete a
Comprehensive Demonstration Study during the first permit renewal
following promulgation of the Phase III rule (see Sec.
125.104(a)(2)(ii)).
A discussion of the timing of implementation of this proposed rule,
if promulgated, is provided in section VII.
H. What Special Definitions Apply to This Proposal?
EPA is proposing specialized definitions to clarify which
facilities are subject to national categorical requirements. For the
new oil and gas extraction facility requirements in
[[Page 68457]]
Subpart N, EPA is proposing five new definitions to clarify those
facilities subject to the requirements. These definitions are set forth
in the proposed regulations at Sec. 125.133 and include ``new offshore
oil and gas extraction facilities,'' ``offshore liquified natural gas
import terminals,'' ``seafood processing vessels,'' ``sea chest'' and
``fixed facility''). The remainder of the proposed definitions are the
same as those found in the final Phase I regulations; however, not all
of the definitions from Phase I regulations have been used as they are
not all applicable to these proposed Subpart N regulations.
EPA is also proposing definitions for Phase III existing facilities
in Subpart K at Sec. 125.102. All of these definitions are borrowed
from both Phase I and Phase II and remain unchanged, except for the
cutoff date in the definition of ``existing facility'' for new versus
existing offshore oil and gas extraction facilities. Similar to the
definitions for subpart N described above, not all of the definitions
from Phase II regulations have been used as they are not all applicable
to these proposed Subpart K regulations.
EPA solicits comment on these regulatory definitions.
III. Summary of Data Collection Activities
For the Phase III proposed rule, EPA focused its data collection
activities on section 316(b) survey data supplemented by available
existing data sources including the data developed for the Phase I and
Phase II rules.
A. Survey Questionnaires
As discussed in the preamble to the Phase II final rule (69 FR
41576), EPA's industry survey effort consisted of a two-phase process.
EPA administered a screener questionnaire focused on nonutility and
manufacturing facilities as the first phase of this data collection
process. The screener questionnaire provides information on cooling
water intake capacity, sources of the water, intake structure types,
and technologies used to minimize adverse environmental impacts. It
also provides data on facility and parent firm employee numbers and
revenues. This information was used to design a sampling plan for the
subsequent detailed questionnaire. Following the screener survey, the
Agency administered either a short technical or a detailed
questionnaire to utility, nonutility, and manufacturing facilities, as
described below. The two-phase survey was designed to collect
representative data from a sample group of those categories of
facilities potentially subject to section 316(b) regulation for use in
rule development.
In 1997, EPA estimated that over 400,000 facilities could
potentially be subject to a cooling water intake regulation. Given the
large number of facilities potentially subject to regulation, EPA
decided to focus its data collection efforts on six industrial
categories that, as a whole, were estimated to account for over 99
percent of all cooling water withdrawals. These six sectors were:
Utility Steam Electric, Nonutility Steam Electric, Chemicals & Allied
Products, Primary Metals Industries, Petroleum & Coal Products, and
Paper & Allied Products. At the time of the survey, there were about
48,500 facilities in these six categories. EPA believes that this
approach provided a sound basis for assessing best technologies
available for minimizing adverse environmental impacts.
The screener survey focused on nonutility and manufacturing
facilities. EPA developed the sample frame (list of facilities) for the
screener questionnaire using public data sources as described in the
Information Collection Request (DCN 3-3084-R2 in Docket W-00-03).
Facilities chosen for the screener questionnaire represented a
statistical sample of the entire universe of nonutility and
manufacturing facilities potentially subject to cooling water intake
regulations. EPA did not conduct a census of all facilities (i.e. send
a survey to all facilities) for the screener questionnaire because of
the burden associated with surveying a large number of facilities.
Rather, EPA refined the industry data using industry-specific sources
to develop sample frames and mailing lists. EPA believes the sample
frame was sufficient to characterize the operations of each industrial
category. EPA sent the screener questionnaire to 2600 facilities
identified in the sample frame as follows: (1) All identified steam
electric nonutility power producers, both industrial self-generators
and nonindustrial generators (1050 facilities, of which 853 responded);
and (2) a sample of manufacturers from the four non-steam electric
industrial categories: paper and allied products, chemical and allied
products, petroleum and coal products, and primary metals (1550
facilities, of which 1217 responded). EPA adjusted the sample frame for
the screener questionnaire to account for several categories of non-
respondents, including facilities with incorrect address information,
facilities no longer in operation, and duplicate mailings. Through
follow-up phone calls and mailings, EPA increased the response rate for
the screener questionnaire to 95 percent. The screener questionnaire
was not sent to utilities, all of which were believed to be identified
accurately using the publicly-available data described above.
A sample of manufacturing and nonutility facilities identified as
in-scope (subject to regulation) by the screener questionnaire and all
utilities then were sent either a short technical or a detailed
questionnaire. A total of 878 utility facilities, 343 nonutility
facilities and 191 manufacturing facilities received one of the two
questionnaires (short technical or detailed) during the second phase of
the survey. For utilities, nonutilities, and other manufacturing
facilities, EPA selected a random sample of these eligible facilities
to receive a detailed questionnaire. The sample included 282 utility
facilities and 181 nonutility facilities. All 191 manufacturing
facilities received a detailed questionnaire. For nonutilities and
utilities, those facilities not selected to receive a detailed
questionnaire were sent a Short Technical Questionnaire. EPA's approach
in selecting a sample involved the identification of population strata,
the calculation of sample sizes based on desired levels of precision,
and the random selection of sites given the sample size calculations
within each stratum. More detail is provided in the report entitled
``Statistical Summary for Cooling Water Intakes Structures Surveys''
(See DCN 3-3077 in Docket W-00-03).
Five questionnaires were distributed to different industrial
groups. They were: (1) Detailed Industry Questionnaire: Phase II
Cooling Water Intake Structures--Traditional Steam Electric Utilities;
(2) Short Technical Industry Questionnaire: Phase II Cooling Water
Intake Structures--Traditional Steam Electric Utilities (sent to both
utilities and nonutilities); (3) Detailed Industry Questionnaire: Phase
II Cooling Water Intake Structures--Steam Electric Nonutility Power
Producers; (4) Detailed Industry Questionnaire: Phase III Cooling Water
Intake Structures--Manufacturers; and, (5) Watershed Case Study Short
Questionnaire. The questionnaires provided EPA with technical and
financial data necessary for developing this proposed regulation.
Specific details about the questions may be found in EPA's Information
Collection Request (DCN 3-3084-R2 in Docket W-00-03) and in the
questionnaires (see DCN 3-0030 and 3-0031 in Docket W-00-03 and Docket
for today's proposal); these documents are also available on EPA's Web
site
[[Page 68458]]
(http://www.epa.gov/waterscience/316b/question/).
EPA also conducted outreach to industry groups, environmental
groups, and other government entities in the development, testing, and
refinement of a second round of surveys, the section 316(b) Phase III
Industry Technical and Economic Questionnaires, which have been used as
an additional source of data for the Phase III rule. The Phase III
surveys, published in September 2003, were sent to offshore oil and gas
extraction facilities and seafood processing vessels. Specific details
about the questions may be found in EPA's Information Collection
Request (DCN 7-0007) and in the questionnaires (see DCN 7-0008) in the
Docket for today's proposal); these documents are also available on
EPA's Web site (http://www.epa.gov/waterscience/316b/question/). In
addition, EPA utilized a survey conducted by the International
Association of Drilling Contractors (IADC) in 2003 to access technical
data on cooling water use by offshore oil and gas extraction
facilities, including fixed platforms and mobile units.
B. Existing Data Sources
EPA collected data from multiple sources, both public and
proprietary, in order to compile an accurate profile of the potentially
regulated community. EPA reviewed information collected by other
Federal agencies, as well as data compiled by private companies. In
those instances where databases are considered confidential, or where
raw data was unavailable for review, EPA did not consider the
information. Summaries of the reviewed data sources are listed below.
1. Electric Generators
EPA collected a substantial amount of data on the electric power
generating industry in the course of the Phase I, II, and III
rulemakings. For example, EPA used data from the Federal Energy
Regulatory Commission (FERC) (Forms 1 and 1-F), the Energy Information
Administration (EIA) (Forms EIA-412, -767, -860, -861, -867), the Rural
Utility Service (RUS) (Form 12), as well as information from the U.S.
Nuclear Regulatory Commission (NRC), the Utility Data Institute (UDI),
and the Edison Electric Institute (EEI). For detailed information about
these data sources, refer to the proposed rule for Phase II (67 FR
17131).
While electric power generators do not meet the proposed flow
thresholds and are therefore not subject to Phase III national
requirements (refer to section VI for further details), EPA did use the
aforementioned data on electric power generators in reaching this
decision. Data was used to assess, for example, the cooling water
intake flows and the amount of electricity generated, and as part of
the determination of economic impacts of the various compliance
alternatives that EPA considered in developing the proposed rule.
2. Manufacturers
In order to identify potential entrainment impacts at facilities
with a design intake flow below 50 MGD, EPA conducted a field study of
six manufacturers in the Spring of 2002. This study was conducted in
the mid-Atlantic region, with particular focus on the Delaware River
and its tributaries. Sampling sites were selected for three freshwater
and three tidal river facilities. EPA conducted two 4-day sampling
events at each facility and conducted measurements of the following
variables: site location and sampling point, facility intake flow rate,
sampling pump volume, sampling time and duration and sample chain of
custody. Additional physicochemical variables were measured, including
the following: temperature, dissolved oxygen (DO), pH, and
conductivity. Taxonomic identification was conducted for all organisms
collected and results are provided in the Data Report for Small
Facility Ichthyoplankton Entrainment Sampling for the Development of
the 316(b) Phase III Rule for Cooling Water Intake Structures (EPA,
2003) (DCN 7-0009).
In mid-June 2003, in order to supplement the biological data used
for estimating baseline impingement mortality and entrainment rates,
EPA compiled a list of facilities who had responded in their industry
questionnaire that they had conducted a biological study. Some of these
facilities were then requested to provide EPA with copies of these
studies. The first data collection effort focused on facilities that
are located on an inland waterbody and have a high average daily intake
flow. Preference was given to facilities located on Lake Michigan and
the Columbia River, as these waterbodies (and more broadly, these
regions of the country) were identified as having inadequate data for
future analysis of Phase III impingement mortality and entrainment
rates. The second data collection effort focused on facilities located
in particular U.S. Fish and Wildlife Service fish regions to be used by
EPA in calculation of benefits for the rule. The last data collection
effort focused specifically on Phase III facilities. In total, 90
facilities were contacted and these contacts resulted in collection of
63 biological studies (33 of which were from Phase III facilities) for
use in estimation of baseline impingement mortality and entrainment
rates.
3. Offshore Oil and Gas Extraction Facilities and Seafood Processing
Vessels
EPA conducted extensive research on the use of cooling water by
offshore oil and gas extraction facilities and seafood processing
vessels to determine whether these industry sectors would be subject to
regulation under the Phase III rule. Information sources included
industry surveys (one administered by EPA in conjunction with the
International Association of Drilling Contractors (IADC) and another
solely by EPA); industry databases and other publicly available
information, and meetings with government and industry representatives.
The survey efforts are described in section III.A above.
In April and May of 2003, EPA conducted site visits and field
interviews at offshore oil and gas extraction facilities and seafood
processing vessels to evaluate technologies in use for reducing
impingement mortality and/or entrainment at these facilities. EPA
employed the services of a specialized naval engineer to conduct these
site visits and field interviews. Site visits were conducted at
platforms and vessels. In addition, field interviews were conducted
with industry personnel. The data collected from these visits and
interviews included geographic data, intake design and impingement and
entrainment technologies in place, impingement and entrainment problems
encountered as well as any methods utilized in resolving such problems
(See DCN 7-0010).
Sources used by EPA to characterize the offshore seafood processing
industry included the following:
U.S. Food and Drug Administration (FDA), Center for Food
Safety and Applied Nutrition, January 2003, which included a list of
U.S. FDA-European Union (EU) Exporters, Processing Vessels.
Alaska Department of Fish and Game 2002 Intent to Operate
Listing.
Water Discharge Permits (PCS) database searches by SIC
codes 2091, 2092 and 2077.
Department of Transportation Maritime Administration
(MARAD) Web site: http://www.marad.dot.gov/publications/index.html and
http://www.marad.dot.gov/Marad_Statistics/index.html.
U.S. Coast Guard Merchant Vessels of the United States
database.
[[Page 68459]]
U.S. Coast Guard PSIX/MSIS databases.
National Transportation Safety Board database.
U.S. Army Corps of Engineers, Navigation Data Center,
Waterborne Commerce Statistics Center.
The Alaska Department of Fish and Game Division of
Commercial Fisheries Web site: http://www.cf.adfg.state.ak.us The At-Sea Processors Association Web site: http://www.atsea.org/.
EPA Region 10 Database of seafood processors permitted in
Alaska.
Technical Development Document (TDD) for the Uniform
National Discharge Standards (UNDS) program (found at http://unds.bah.com/TDD.pdf
) (Appendix A: Seawater Cooling Overboard Discharge
Report).
National Marine Fisheries Service Web site, Restricted
Access Management Program, http://www.fakr.noaa.gov/ram/default.htm.
National Marine Fisheries Services Web site, link to
American Fisheries Act (AFA) permits: http://www.fakr.noaa.gov/ram/afa.htm#list
.
Several vessel operators, naval architects, engineers and
regulators.
C. Data Provided to EPA by Industrial, Trade, Consulting, Scientific or
Environmental Organizations or by the General Public
Since 1993, EPA has been developing cooling water regulations as
part of a collaborative effort with industry and environmental
stakeholders, other Federal agencies, the academic and scientific
communities, and the general public. As a result, EPA has reviewed and
considered the many documents, demonstration studies, scientific
analyses, and historical perspectives offered in support of each phase
of the regulatory process. For example, during the early stages of data
gathering, EPA created an internal library of reference documents
addressing cooling water intake structure issues. This library
currently holds over 2,800 documents, many of which were referenced in
the rulemaking process and are contained in the record (see the
following paragraph for further information on the record). The library
contains a thorough collection of a wide variety of documents,
including over 80 section 316(b) demonstration documents, over 300
impingement and entrainment studies, over 100 population modeling
studies, over 500 fish biology and stock assessment documents, over 350
biological studies commissioned by power generators, over 80 NPDES
decisions and NPDES or SPDES-related documents, over 120 intake
technology reports, over 10 databases on the electric power industry,
and documents from interagency committees such as the Ohio River Valley
Water Sanitation Commission (ORSANCO).
In addition, the record for the Phase I new facility rule contains
nearly 1,000 documents (research articles, databases, legal references,
memorandums, meeting notes, and other documents), consisting of
approximately 47,000 pages of supporting material available for public
review. And the record for the Phase II existing facility rule contains
over 2600 additional documents, comprising approximately 125,000 pages
of supporting material.
Finally, EPA has worked extensively with stakeholders from
industry, public interest groups, State agencies, and other Federal
agencies in the development of this proposed rule. These public
participation activities have focused on various section 316(b) issues,
including general issues, as well as issues relevant to development of
the Phase II rule and issues relevant to this proposed Phase III rule.
See section I.C.6 of this preamble for a discussion of key public
participation activities.
IV. Overview of Facility Characteristics (Cooling Water Systems &
Intake Structures) for Industries Potentially Subject to Proposed Rule
Today's proposed rule would apply national categorical requirements
to two groups of facilities that use cooling water intake structures to
withdraw water from waters of the U.S.: existing manufacturing and
industrial facilities and new offshore oil and gas extraction
facilities.
A. Overview of Potentially Regulated Phase III Universe
EPA's data collection efforts largely focused on five industrial
sectors: small flow electric power generators (both utilities and
nonutilities withdrawing less than 50 MGD); chemicals and allied
products (SIC Major Group 28); primary metals industries (SIC Major
Group 33); paper and allied products (SIC Major Group 26); and
petroleum and coal products (SIC Major Group 29). The latter four
sectors use a significant portion of the cooling water withdrawn among
all manufacturing industries. EPA also identified other industry
sectors that use cooling water including: transportation equipment (SIC
Major Group 37); lumber and wood products (SIC Major Group 24); rubber
and plastics products (SIC Major Group 30); food and kindred products
(SIC Major Group 20); tobacco products (SIC Major Group 21); and
machinery (SIC Major Group 35) (see DCN 7-0011). A more comprehensive
list of industries that use cooling water and their NAICS and SIC Codes
can be found in section A of the Supplementary Information. Although
EPA's survey data collection efforts were not designed to collect data
from industries other than the five listed above, data were collected
from the following industries: food processing; aircraft engines and
engine parts; cutlery; sawmills and planing mills; finishers of broad
woven fabrics of cotton; potash, soda and borate minerals; iron ores;
and sugarcane and sugar beets. These data from other industries, while
not a statistically derived sample, confirm that the five primary
industry sectors discussed above account for the vast majority of Phase
III cooling water use. The data also suggest that the intake structure
design and construction at these industries were substantially similar
to the industries for which EPA did collect data.
Of the estimated 683 manufacturing and electric generator
facilities (survey weighted estimate, as described in the Technical
Development Document EPA-821-R-04-015, DCN 7-0004) within the Phase III
universe,\6\ approximately 225 (33 percent) belong to the pulp and
paper sector, 185 (27 percent) belong to the chemical sector, 88 (13
percent) belong to the metals sector, and 39 (6 percent) belong to the
petroleum sector. EPA also surveyed 29 facilities in other industry
sectors (discussed above, all of which are potentially subject to the
Phase III rule) in the detailed questionnaire, and those data are also
being considered in today's proposed rule. In addition, an estimated
117 (17 percent) electric generating facilities are included within the
Phase III universe.
---------------------------------------------------------------------------
\6\ The entire Phase III universe includes facilities with a
design intake flow greater than 2 MGD which use at least 25 percent
of the water withdrawn exclusively for cooling, and are not covered
by Phase II. Offshore oil and gas extraction facilities are not
included in this estimate.
---------------------------------------------------------------------------
The information below is generally based on data collected from the
Short Technical Industry Questionnaire, the Detailed Industry
Questionnaire, and the Phase III Industry Technical and Economic
Questionnaires. Additional detail discussing the entire Phase III
universe as well as facilities subject to the uniform national
standards and facilities subject to permitting based on best
professional judgment can be found in the Technical Development
Document.
As explained in section V of this preamble, there are five main
categories of surface water used as sources of cooling water. The
source of surface water withdrawn for cooling is an
[[Page 68460]]
important factor in determining potential environmental impacts. An
estimated 11 (2 percent) facilities withdraw cooling water from an
ocean; an estimated 39 (6 percent) facilities withdraw cooling water
from an estuary or tidal river; an estimated 496 (73 percent)
facilities withdraw cooling water from a freshwater stream or river; an
estimated 60 (9 percent) facilities withdraw cooling water from a lake
or reservoir; and an estimated 77 (11 percent) facilities withdraw
cooling water from one of the Great Lakes. EPA estimates a total design
intake flow of 40,441 MGD and total actual intake flow of 21,624 MGD
for the Phase III universe.
Of the facilities within the Phase III universe, 303 (44 percent)
employ once-through cooling systems, 198 (29 percent) use closed-cycle
recirculating cooling systems, 121 (18 percent) use ``combination''
systems, and 61 (9 percent) use an ``other'' type of system. An
estimated 286 (42 percent) facilities have installed a cooling tower.
Note that not all facilities that have installed a cooling tower are
classified as using closed-cycle recirculating cooling systems, as some
facilities with multiple cooling water systems may be ``combination''
systems that employ both closed-cycle and once-through cooling.
Facilities may also list ``helper'' cooling towers, which are generally
used to mitigate discharge temperatures and do not affect intake flows.
Since facilities may have more than one cooling water system, these
estimates are based on the predominant cooling water system at each
facility.
Facilities within this universe also may have more than one cooling
water intake structure configuration. Therefore, in providing the
information on intake structures, a facility may be counted multiple
times (as many times as it has distinct cooling water intake structure
configurations). Thus, of the facilities within the Phase III universe,
683 facilities represent an estimated 747 total cooling water intake
structure configurations. Of these, an estimated 359 (48 percent) have
a shoreline intake, 216 (29 percent) have a submerged offshore intake,
123 (16 percent) withdraw cooling water through a canal or channel, 49
(7 percent) have an intake situated in a bay or cove, and 47 (6
percent) are estimated to have some other type of intake or provided no
information.
B. Existing Manufacturers and Industrial Faciliti