[Federal Register: December 17, 2008 (Volume 73, Number 243)]
[Rules and Regulations]
[Page 76560-76567]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17de08-10]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52
[EPA-R05-OAR-2006-0609; FRL-8748-9]
Approval and Promulgation of Air Quality Implementation Plans;
Wisconsin; NSR Reform Regulations, Rule AM-06-04
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final rule.
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SUMMARY: EPA is approving certain revisions to Wisconsin's prevention
of significant deterioration (PSD) and non-attainment new source review
(NANSR) construction permit programs, which Wisconsin submitted on May
25, 2006. The Wisconsin Department of Natural Resources (WDNR) is
seeking approval of rule AM-06-04 to implement the
[[Page 76561]]
NSR Reform provisions that were not vacated by the United States Court
of Appeals for the District of Columbia (D.C. Circuit) in New York v.
EPA. EPA proposed approval of these rules on April 20, 2007 and
received adverse comments. In this action, EPA responds to these
comments and announces EPA's final rulemaking action. This action
affects major stationary sources in Wisconsin that are subject to or
potentially subject to the PSD and NANSR construction permit programs.
DATES: This final rule is effective on January 16, 2009.
ADDRESSES: EPA has established a docket for this action under Docket ID
No. EPA-R05-OAR-2006-0609. All documents in the docket are listed on
the www.regulations.gov Web site. Although listed in the index, some
information is not publicly available, i.e., Confidential Business
Information (CBI) or other 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 through www.regulations.gov or in hard copy at the
Environmental Protection Agency, Region 5, Air and Radiation Division,
77 West Jackson Boulevard, Chicago, Illinois 60604. This facility is
open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding
Federal holidays. We recommend that you telephone Danny Marcus,
Environmental Engineer, at (312) 353-8781 before visiting the Region 5
office.
FOR FURTHER INFORMATION CONTACT: Danny Marcus, Environmental Engineer,
Air Permits Section, Air Programs Branch (AR-18J), EPA Region 5, 77
West Jackson Boulevard, Chicago, Illinois 60604, (312) 353-8781,
marcus.danny@epa.gov.
SUPPLEMENTARY INFORMATION:
I. What is being addressed by this document?
II. What sections of Wisconsin's rules are we approving in this
action?
III. How has this rulemaking been affected by the December 21, 2007
rulemaking which clarifies the ``reasonable possibility'' provision?
IV. What are EPA's responses to adverse comments?
V. What action is EPA taking?
VI. Statutory and Executive Order Reviews
I. What is being addressed by this document?
We are approving rule AM-06-04 as a revision to the PSD and NANSR
construction permit programs for the State of Wisconsin. EPA granted
final approval to Wisconsin's NANSR program on January 18, 1995 (60 FR
3538) and the approval became effective on February 17, 1995. EPA
granted final approval to Wisconsin's PSD program on May 27, 1999 (64
FR 28745), which became effective on June 28, 1999.
On December 31, 2002, EPA published revisions to the Federal PSD
and NANSR regulations in 40 CFR Parts 51 and 52 (67 FR 80186). These
revisions are commonly referred to as the New Source Review (NSR)
Reform Rule and became effective on March 3, 2003. These regulatory
revisions included provisions for establishing Plant-wide Applicability
Limits (PALs), Clean Units and Pollution Control Projects (PCPs), for
determining baseline actual emissions, and for promulgating the actual-
to-future-actual methodology. As stated in the December 31, 2002, EPA
rulemaking, state and local permitting agencies were required to adopt
and submit revisions to their part 51 permitting programs implementing
the minimum program elements of that rulemaking no later than January
2, 2006 (67 FR 80240). With this action, we are approving WDNR's
program revisions that satisfy this requirement.
WDNR originally prepared rule changes to adopt a version of the
Federal rule revisions, which were subsequently authorized by the
Wisconsin Natural Resources Board for public hearing in December 2003.
On June 24, 2005, the DC Circuit issued its ruling on challenges to the
December 2002 NSR Reform Rule. New York v. EPA, 413 F.3d 3 (DC. Cir
2005). Although the court upheld most of EPA's rules, it vacated both
the Clean Unit and the PCP provisions. In addition, the court remanded
to EPA the ``reasonable possibility'' provision for reporting and
recordkeeping. In response, on December 21, 2007, EPA published a rule
that clarifies the recordkeeping and reporting standards of the 2002
rule.
After the DC Circuit ruled on the challenges to the Federal NSR
Reform Rule, WDNR adopted those portions of the Reform Rule that the
court upheld, and modified the portion that the court remanded to EPA
in accordance with the court's instructions. WDNR submitted the
revisions to EPA on May 25, 2006. These revisions are consistent with
the current provisions of the NSR Reform Rule following the ruling of
the DC Circuit.
II. What sections of Wisconsin's rules are we approving in this action?
We are approving amendments to provisions of the PSD and NANSR
construction permit programs in the Wisconsin State Implementation Plan
(SIP). Please refer to the proposed rule of this action which includes
a detailed explanation of the provisions that are being approved. This
final action amends the following provisions within NR 405, NR 408, and
NR 484: NR 405.01(1) and (2), NR 405.02(1), NR 405.02(1)(d), NR
405.02(2m), NR 405.02(8) and (11), NR 405.02(11c), (11e) and (11j), NR
405.02(12), NR 405.02(20m), NR 405.02(21) and (24), NR 405.02(24j), NR
405.02(24m), NR 405.02(25b), (25d), (25e), (25f) and (25i), NR
405.02(27)(a)8., 17., and 18., NR 405.02(27m), NR 405.025, NR 405.16(3)
and (4), NR 405.18(1) to (15), NR 408.02(1), NR 408.02(2m), NR
408.02(4), (5), and (11), NR 408.02(11e), (11m) and (11s), NR
408.02(13), NR 408.02(13m), NR 408.02(20), NR 408.02(21)(a)1.(intro),
NR 408.02(23), NR 408.02(24m) and (25s), NR 408.02(27), NR 408.02(28e),
(28j), (28m), (28s), (29m), and (32m), NR 408.025, NR 408.06(10), NR
408.10(5) and (6), NR 408.11(1) to (15), NR 484.04(21), and NR
484.04(27m).
III. How has this rulemaking been affected by the December 21, 2007
rulemaking which clarifies the ``reasonable possibility'' provision?
As part of its ruling on challenges to the December 2002 NSR Reform
Rule, the DC Circuit remanded to EPA the ``reasonable possibility''
provision regarding reporting and recordkeeping. New York v. EPA, 413
F.3d at 35-36. In response, on December 21, 2007, EPA published a rule
(72 FR 72607) that clarifies the recordkeeping and reporting standards
of the 2002 rule. The rule adds further clarification to the criteria
determining whether a source experiencing a physical change or change
in the method of operation that does not trigger major NSR permitting
requirements must keep records. The standard also specifies the
recordkeeping requirements for such sources.
WDNR requires any facility that chooses to use the ``past-actual-
to-future-actual'' provision to satisfy the recordkeeping and reporting
standards. NR 405.16(3) and NR 408.10(5) are more stringent than the
criteria established by EPA to determine whether a facility is subject
to the recordkeeping and reporting requirements. See 40 CFR
51.165(a)(6) and 40 CFR 51.166(r)(6).
The preamble to the December 21, 2007, rule states that state and
local authorities have the option of making their regulations more
stringent than these rules. The preamble also states that state and
local authorities that have regulations within their SIP, which they
[[Page 76562]]
believe fulfills the minimum criteria of the December 21, 2007,
rulemaking, must submit notice acknowledging that their rules are at
least as stringent as the Federal rules within three years of December
21, 2007. We have concluded that the revisions that we are approving
today into Wisconsin's SIP are consistent with the December 21, 2007
rulemaking.
IV. What are EPA's responses to adverse comments?
EPA received comments both in support of and in opposition to
Wisconsin's rules. The Sierra Club provided adverse comments on EPA's
April 20, 2007, proposed rule approval. EPA responded to these adverse
comments in a document that can be found in the official docket for
this action. The document is titled, ``Response to Comments by the
Sierra Club on NSR Reform Regulations.'' Below are EPA's responses to
each of the Sierra Club's comments, which are set forth in full in the
aforementioned document:
Comment I: The Proposed Modifications to Wisconsin's SIP are an
Impermissible Backslide.
Response: The Federal NSR Reform Rule was upheld by the DC Circuit
in New York v. EPA, 413 F.3d 3 (DC Cir. 2005), with the exception of
the Pollution Control Project, Clean Unit, and ``reasonable
possibility'' provisions. Therefore, with the exceptions noted, the
revisions to Wisconsin's NSR rules, which are based on the Federal NSR
Reform Rule, have already withstood judicial scrutiny and are lawful.
EPA addresses the commenter's specific points as follows:
a. As addressed in the national Rulemaking, the proposed NSR Reform
Rule of 1996, 61 FR 38250 (July 23, 1996) addressed the provision for
the actual-to-future-actual method of determining whether or not a
source is subject to major NSR. Thus, the appropriate time to have
commented on this provision was prior to October 21, 1996, the close of
the public comment period. EPA has found that while the actual-to-
projected-actual test would reduce the number of sources that would
need to take permit limits, the environmental benefit of these permit
limits is preserved, because any source projecting no significant net
emissions increase must stay within that projection or comply with NSR.
Furthermore, in Wisconsin, a minor increase in emissions, even if small
enough not to trigger major NSR, is still required to meet the criteria
of NR 406.04(1k) of WDNR's SIP. Facilities that are able to net out of
permit review under the actual-to-actual provision are still required
to ensure that the modifications do not cause or exacerbate an air
quality increment or air quality standard.
b. The test developed in Wisconsin Electric Power Company v.
Reilly, 893 F.2d 901, 904 (7th Cir. 1990), as a result of the NSR
Reform Rule, applies to all facilities and not just power plants. EPA
found that the ten-year look back period promotes economic growth and
administrative efficiency by affording sources the flexibility to
respond rapidly to market changes, focusing limited regulatory
resources on changes most likely to harm the environment. The DC
Circuit upheld the ten-year look back period, stating, ``* * * we
conclude that petitioner's challenges to the ten-year look back period
fail to overcome the presumption of validity afforded to EPA
regulations under the [Clean Air Act (CAA or Act)].'' New York v. EPA,
413 F.3d at 22. The court found that EPA's decision regarding this
provision was supported with ``detailed and reasoned'' analysis based
on EPA's own experience and expertise. New York v. EPA, 413 F.3d at 24.
c. Other than the change that applies the ten-year look back period
to all sources, EPA's policy of determining ``actual'' emissions from
two years of operating data has not changed. EPA's policy is to have
all of the appropriate operating data that can prove what a facility's
emissions were during that particular time period to identify the
``actual'' emissions.
d. A source's ability to use the full ten-year look back period
will depend upon the availability of relevant data for the consecutive
24-month period that a source chooses. The data must adequately
describe the operation and associated pollution levels for the
emissions units being changed. In the event that a source does not have
the data necessary to determine the unit's actual emission factors,
utilization rate, and other relevant information needed to accurately
calculate its average annual emissions rate during that period of time,
the source must chose another consecutive 24-month period within the
ten-year look back period for which it has adequate data. ``Non-
compliant emissions'' are not allowed to be considered as part of the
baseline actual emissions. This is to be determined by the permitting
authority after reviewing adequate files and working with the source to
determine the true baseline actual emissions based on the available
data and considering all applicable regulations and emission
limitations.
e. EPA received comments both in favor of and in opposition to
making the demand growth exclusion available to all source categories.
EPA decided to extend the demand growth exclusion because it captures
periods of time where increased operations respond to independent
factors, such as system-wide demand growth, which would have occurred
and affected the unit's operations even in the absence of a physical or
operational change. The ten-year look back period allows a facility to
identify a consecutive 24-month time frame when the facility was
operating at its true capacity, and calculate the emissions that
resulted during that period. Instead of duplication, the provisions
serve distinct purposes. In cases where the source experiences full
capacity utilization, the source will not have a basis for attributing
part of its post-change emissions increase to market demand. However,
if the source still has the ability to increase production to meet
projected market demand without making a physical or operational
change, the source may consider product demand growth.
f. EPA has taken the position that replacement units may be
considered to be modified units, since the replacement unit is
replacing a similar emissions unit with a record of historical
operational data. Since the replacement unit is very similar to the
unit that is being replaced, a source replacing a unit should be able
to adequately project and track emissions for the replacement unit
based on the operating history of the replaced unit. Therefore, the
projection of future actual emissions can be sufficiently reliable and
an up-front emissions cap based on Potential to Emit (PTE) is
unnecessary. See revised definition of ``emissions unit,'' 68 FR 63021
(November 7, 2003), clarifying that a replacement unit is considered an
existing emissions unit and, therefore, is eligible for the actual-to-
projected-actual test for major NSR applicability determinations.
g. In New York v. EPA, 413 F.3d at 36-38, the DC Circuit held that
the environmental petitioners had failed to demonstrate that PALs are
based on an impermissible statutory interpretation or are otherwise
arbitrary and capricious. As part of an Environmental Impact Analysis,
EPA examined six pilot projects that implemented flexible permits
similar to PALs. The participants in these pilot projects reduced their
emissions by 27% to 83% below their PAL levels, and, based on these
results, EPA concluded that PALs encourage sources to reduce their
emissions voluntarily in order to ``create enough headroom for future
expansions'' during the PAL term. See New York v. EPA, 413 F.3d at 37.
[[Page 76563]]
h. In New York v. EPA, the DC Circuit addressed the environmental
petitioners' comment that a ten-year look back period allows facilities
to set their PALs high enough to accommodate future increases without
any initial decreases. It examined EPA's conclusion that the ten-year
look back period affects only a small percentage of sources, and that
most sources would set their PALs equal to recent baseline actual
emissions, thereby reducing emissions by 10% to 33% below their PAL
levels. The court found that state intervenors' experience confirmed
EPA's conclusions. See New York v. EPA, 413 F.3d at 38.
i. PALs are designed to cap a facility's emissions for a criteria
pollutant, and thus allow facilities to operate within a cap without
triggering NSR. Additional necessary recordkeeping, monitoring, and
reporting are required for facilities to obtain a PAL, and compliance
must be demonstrated through the additional monitoring activities
required. The commenter asserts that PALs replace operational
limitations that are never restored after a PAL limit expires. We
disagree. Once a PAL expires, the facility loses the ability to operate
particular emission units unrestricted within the facility-wide cap.
Sources that have existing permits with limitations that are subject to
state or Federal requirements such as Best Available Control Technology
(BACT), Reasonably Available Control Technology (RACT), and New Source
Performance Standards (NSPS), and they must still comply with those
particular requirements throughout the use of the PAL, as well as after
the expiration of a PAL. The reviewing authority maintains the
discretion to determine how to distribute any remaining allowable
emissions after a PAL's expiration. This may require a source to take
emission limits even more stringent than the original emission/
operating limits that originally applied to an emission unit, or
require that unit to undergo a PSD/NANSR analysis.
The commenter points to a 2003 WDNR prepared analysis, which they
describe as concluding that specific emissions increases would result
if the elements of NSR Reform were approved into Wisconsin's SIP.
Unfortunately, the commenter did not include the 2003 analysis with the
comments. The analysis that the commenter attached to the comments is a
presentation file that does not contain an explanation describing how
WDNR arrived at the increases that the commenter references in the
comments.
EPA has made several attempts to obtain any existing supporting
documentation for the analysis the commenter describes. WDNR has not
been able to provide us with any documentation in support of the 2003
conclusions to which the commenter refers. However, as a result of our
efforts to obtain this documentation, we did obtain from WDNR a
document entitled ``Report to Legislature,'' (hand-dated March 10,
2006, and received by EPA on October 7, 2008). This 2006 report
contains, among other things, a description of WDNR's 2003 position
regarding the analysis. In the report, WDNR states that its 2003
conclusion was that the NSR reform rules would lead to emissions
increases because fewer projects would be required to undergo major
source NSR, but that this conclusion was flawed because WDNR did not
examine other changes at a facility that would reduce allowable
emissions. Further, the 2006 report acknowledges that the State of
Michigan has been implementing the elements of the Federal NSR Reform
Rule since March 3, 2003, and that Michigan has not seen a decrease in
PSD permit applications. According to the 2006 report, Michigan and
Wisconsin have issued a similar number of PSD permits annually and have
a comparable number of sources subject to the major source NSR program.
Because WDNR has, itself, disavowed its own former predictions, and EPA
never received supporting documentation for the predictions, EPA does
not find the comments based on WDNR's 2003 analysis to be persuasive.
Finally, any analysis done in 2003 would have been done prior to
New York v. EPA, the 2005 DC Circuit decision that vacated the Clean
Unit and Pollution Control Projects provisions of the rule. Such
analysis would be based on the NSR Reform Rule prior to the changes
made as a result of the decision, and so the analysis could not have
considered the rules that are in effect today.
The commenter also points to a report entitled, ``Reform or
Rollback? How EPA's Changes to New Source Review Affect Air Pollution
in 12 States.'' The report was prepared by the Environmental Integrity
Project (EIP) and the Council of State Governments/Eastern Regional
Conference. The draft report claims that the change to a ``two-in-ten''
baseline could allow emissions from 1,273 major sources to increase
emissions in 12 states. However, EPA disagrees that the EIP report
supports this conclusion. EPA has found the analysis to be overly
simplistic and erroneous in its interpretation of NSR. These failures
undermine the plausibility of the report's conclusions, including its
emissions estimates. EPA notes, in particular, the following problems
with the report:
The approach EIP used looks at plant-wide emissions
inventories at facilities where emissions have been lower in the recent
two years than in the past. The plant-wide inventory approach
completely avoids consideration of why these emissions went down.
The report incorrectly used plant-wide emissions inventory
changes as a crude estimate of emissions increases allowed under the
rule.
The EIP analysis did not consider the fact that major
source NSR is only triggered when a physical change or change in the
method of operation of a source results in a significant net emissions
increase.
The EIP analysis ignored netting. Even if a project
results in a significant increase, it does not trigger major source NSR
if there are decreases during the contemporaneous period that offset
the increases during that period (including the project increase).
The EIP analysis purported to measure the ``potential''
for increases under the rule revisions. Notwithstanding all the other
flaws of the analysis, EIP made no assessment of whether this
``potential'' will actually be realized.
Industry has complained that it is often expected to surrender
capacity under the current approach, because it is not being utilized
in the two-year period immediately preceding the change. The purpose of
the new baseline provision is to enable sources with an existing unit
undergoing modification to select as a baseline a level of operation
that more accurately represents that unit's actual operating history.
EPA has determined that it is reasonable for a source to determine its
baseline emissions in this manner, so long as it is done in compliance
with the applicable regulations. First, a source must have adequate
information to calculate an average annual emissions rate, in tons per
year, for the specific 24-month period selected to represent the unit's
representative operation. Second, a source will be required to make
downward adjustments in the baseline emissions calculations to account
for any enforceable emissions factors and operating restrictions that
have been imposed since the representative baseline period and are more
stringent than the original limits. This adjustment ensures that the
source cannot take credit for an emissions level that is no longer
allowed for the unit if it were
[[Page 76564]]
operating at its representative level today. Third, the new rule for
determining baseline emissions does not affect new sources and new
units at existing sources, nor does it affect electric utility steam
generating units, for which the five-year look back period is still
required. There will be no change in baseline for sources with recent
high levels of emissions or consistent emissions levels over ten-year
periods. Finally, under the existing regulations, states have always
had the flexibility to define a different contemporaneous period under
SIP-approved NSR programs. The new rules will help simplify the process
of determining the appropriate baseline period, and eliminate the
delays associated with the previous approach.
Section 110(l)
The commenter contends that the requested rule revisions would
relax the existing safeguards in the current NSR rules, and thereby
violate section 110(l) of the CAA. Section 110(l) states that ``[t]he
Administrator shall not approve a revision of a plan if the revision
would interfere with any applicable requirement concerning attainment
and reasonable further progress * * * or any other applicable
requirement of this chapter.'' 42 U.S.C. 7410(l).
In ``Approval and Promulgation of Implementation Plans; New Source
Review; State of Nevada, Clark County Department of Air Quality and
Environmental Management,'' 69 FR 54006 (Sept. 7, 2004), the EPA stated
that section 110(l) does not preclude SIP relaxations. The Agency
stated that section 110(l) only requires that the ``relaxations not
interfere with specified requirements of the Act including requirements
for attainment and reasonable further progress,'' and that, therefore,
a state can relax its SIP provisions if it is able to show that it can
``attain or maintain the [National Ambient Air Quality Standards
(NAAQS)] and meet any applicable reasonable further progress goals or
other specific requirements.'' 69 FR 54011-54012.
The Wisconsin-requested NSR revisions track the Federal NSR Reform
Rule, and EPA has already determined that the implementation of the
Federal NSR Reform Rule will be environmentally beneficial. See 68 FR
44620 (July 30, 2003) and 68 FR 63021. EPA's Supplemental Analysis for
the Federal NSR Reform Rule estimated that there are likely to be
reductions in emissions of volatile organic compounds (VOC) due to the
use of PALs. A quantitative methodology was applied in the Supplemental
Analysis to three industrial categories, concluding that 3,400 to
17,000 tons of VOC emission reduction per year was likely nationwide in
just these categories. The three industrial categories selected were
Automobile Manufacturing (SIC 3711), Pharmaceutical Manufacturing (SIC
2834), and Semiconductor Manufacturing (SIC 3674). These were chosen
based on the Flexible Permit Pilot Evaluation Report.\1\ The report
concluded that facilities in these source categories were likely to
adopt a PAL because of frequent operational, time-sensitive changes,
and because of opportunities for economical air pollution control
measures. The Supplemental Analysis determined that 50% to 75% of the
facilities under these categories would seek a PAL and each facility
would reduce its emissions by 10% to 33%.
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\1\ The full reports, ``Evaluation of Implementation Experiences
with Innovative Air Permits,'' is included in the Supplemental
Analysis as Appendix A.
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We have found seven facilities that fall under these categories
within Wisconsin. Six are automobile manufacturing facilities and one
is a pharmaceutical manufacturing facility. These facilities may take
advantage of the PAL option under the Federal NSR Reform Rule. The
following tables evaluate the potential effects of PALs in Wisconsin
from these sources.\2\
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\2\ Emissions based on 2002 National Emission Inventory
Database.
------------------------------------------------------------------------
VOC (tons per
Facility name year (TPY)) \2\
------------------------------------------------------------------------
Oshkosh Truck Corp--West Plant........................ 123.8
Oshkosh Truck Corp--Main Plant........................ 78.97
FWD Corporation....................................... 16.28
Western Products...................................... 2.33
Scientific Protein Labs............................... 75.74
GM--NAO Janesville--Truck Platform.................... 1103.56
Oshkosh Truck Corp--South Plant....................... 0.50
------------------------------------------------------------------------
------------------------------------------------------------------------
------------------------------------------------------------------------
If 75% of the facilities above take a PAL
------------------------------------------------------------------------
10% VOC Reduction...................... 105.1 TPY of VOC.
33% VOC Reduction...................... 346.8 TPY of VOC.
いいいいいいいいいいいいいいいいいいいい
If 50% of sources take a PAL
------------------------------------------------------------------------
10% VOC Reduction...................... 70.1 TPY of VOC.
33% VOC Reduction...................... 231.2 TPY of VOC.
10% VOC reduction at largest single 110.3 TPY of VOC.
source.
33% VOC reduction at largest single 364.2 TPY of VOC.
source.
------------------------------------------------------------------------
Using the same methodology used in the Supplemental Analysis to
assess the emissions benefits of Wisconsin's NSR reform revisions in
Wisconsin as EPA used to assess the benefits nationally, we conclude
that the PAL option would result in a net reduction of between 70.1 and
364.2 tons of VOC per year.
EPA's Supplemental Analysis for the Federal NSR Reform Rule
mentions that, since PALs are voluntary, it is extremely difficult to
model how many and which particular sources will take PALs. It is
assumed that the source categories more likely to apply for a PAL are
those sources that are making frequent operational changes.
In Wisconsin, facilities, like the paper mills, frequently apply
for PSD permits in order to modify their mills, which result in
relatively large increases in emissions. An analysis of the National
Emissions Inventory found that Wisconsin has about 73 major sources
that belong to SIC group 26, paper and allied products. These sources
emit about 8,358 tons of VOC per year. Even if a conservative 10% of
these sources were to take a PAL for a conservative decrease in
emissions between 10% and 33%, that would result in a total decrease in
emissions between about 83.5 tons to 275.8 tons of VOC per year.
It is more difficult to assess the environmental impacts of the
actual-to-projected-actual test and the ``two-in-ten'' baseline
provisions. The Supplemental Analysis determined that there is a slight
national environmental benefit brought about by these NSR reform
provisions. Additionally, in Wisconsin, sources undergoing
construction, which are not subject to the best available control
technology or
[[Page 76565]]
lowest achievable emission reduction NSR requirements, will need to
assure WDNR that any increases will not cause or exacerbate an air
quality increment or air quality standard.
Overall, we expect changes in air quality as a result of
implementing PALs, the actual-to-projected-actual test and the ``two-
in-ten'' baseline provisions in Wisconsin to provide somewhere between
a neutral and modest contribution to reasonable further progress.
Accordingly, EPA determines that these changes will not interfere with
any applicable requirement concerning attainment and reasonable further
progress or any other applicable requirement of the CAA.
Section 193
The commenter contends that WDNR's NSR Reform revision does not
``demonstrate[] that the NAAQS/PSD Increment/RFP [reasonable further
progress] demonstration/visibility will be protected if the revision is
approved and implemented,'' and that WDNR did not ``quantify the
changes in SIP-allowable emissions and estimate or quantify the changes
in actual emissions from affected sources.'' This failure to
demonstrate protection of the NAAQS, the commenter argues, constitutes
backsliding, in violation of section 193 of the CAA.
As the commenter points out, section 193 of the CAA provides in
part that ``No control requirement in effect * * * before November 15,
1990, in any area which is a non-attainment area for any air pollutant
may be modified after November 15, 1990, in any manner unless the
modification insures equivalent or greater emission reductions of such
air pollutant.'' 42 U.S.C. 7515.
Assuming that section 193 applies to NSR, section 193 does not
require additional emission reductions before this SIP revision is
approved. Wisconsin did not have a major source NANSR program
consistent with the requirements of the CAA. Although the program that
was in effect as of November 15, 1990, included a preconstruction
permitting program, that program did not require any offsets for any
sources. In the proposed rules, major sources are subject to permitting
requirements consistent with CAA requirements.
Thus, assuming that section 193 applies in some fashion to the
permitting program in the SIP, as of November 15, 1990, as it applied
to major sources, that program did not require any ``emission
reductions'' from major sources because it did not require offsets for
any sources. Absent offsets, a source subject to the permitting program
would not be required to reduce emissions. It follows that if there
were no emission reductions generated by the 1990 permitting program,
then the section 193 requirement to provide ``equivalent or greater
emission reductions'' of any air pollutant as part of this SIP revision
would be satisfied with no additional reductions. Furthermore, for the
reasons discussed above with respect to section 110(l), EPA has found
that the net effect of these changes will be neutral to environmentally
beneficial.
Comment II: The Proposed Modifications Violate the Anti-Backsliding
Provisions of Section 172(e).
Response: As discussed above, EPA has concluded that the NSR Reform
Rule is not a ``relaxation'' or weakening of the existing NSR rules.
EPA has assessed the impact of NSR Reform on the State of Wisconsin and
has concluded that approving these revisions into the Wisconsin SIP
will result in somewhere between a neutral effect on the environment
and a modest environmental benefit. Thus, approving the NSR Reform Rule
into the Wisconsin SIP will not result in controls that are ``less
stringent'' than the previous controls. In addition, the changes to the
existing NSR rules are not being undertaken in the context of a NAAQS
relaxation. Thus, section 172(e) does not apply on its face. Nor are
these changes undertaken in the context of strengthening a NAAQS.
Therefore, the decision of the DC Circuit in South Coast Air Quality
Management District v. Environmental Protection Agency, 472 F.3d 882
(D.C. Cir. 2006), does not apply in this context.
Comment III: The Proposed Modifications Cannot Be Adopted Unless
and Until EPA Consults with the Fish and Wildlife Service Pursuant to
the Endangered Species Act (ESA).
Response: Under relevant CAA provisions, states are entitled to
administer their own approved NSR programs, and EPA is required to
approve a state's program or revisions to its program that satisfy
applicable requirements of the CAA. The CAA SIP approval authority does
not provide the Agency with the discretion to refrain from approving
Wisconsin's SIP revisions if the revisions to its NSR program meet all
applicable CAA requirements. Accordingly, and as confirmed by recent
Supreme Court precedent, the ESA requirements cited in the comments do
not apply to EPA's decision to approve revisions to Wisconsin's NSR
program into the SIP. See 50 CFR 402.03; National Ass'n of Home
Builders v. Defenders of Wildlife, 127 S. Ct. 2518 (2007) (Defenders of
Wildlife).
Section 7(a)(2) of the ESA generally requires Federal agencies to
consult with the relevant Federal wildlife agencies to ensure that
actions they authorize, fund, or carry out are not likely to jeopardize
the continued existence of Federally-listed endangered or threatened
species, or result in the destruction or adverse modification of
designated critical habitat of such species. 16 U.S.C. 1536(a)(2). In
accordance with relevant ESA implementing regulations, this requirement
applies only to actions ``in which there is discretionary Federal
involvement or control.'' 50 CFR 402.03. In the Defenders of Wildlife
case, the Supreme Court examined these provisions in the context of
EPA's decision to approve a state permitting program under the Clean
Water Act (CWA). In that case, the Court held that when a Federal
agency is required by statute to undertake a particular action once
certain specified triggering events have occurred, there is no relevant
agency discretion, and thus the requirements of ESA section 7(a)(2) do
not apply. Defenders of Wildlife, 127 S.Ct. at 2536.
With regard to EPA's transfer of CWA permitting authority to a
state, the Court found that the relevant CWA provision mandated that
EPA ``shall approve'' a state permitting program if a list of CWA
statutory criteria is met. Therefore, EPA lacked the discretion to deny
a transfer application that satisfied those criteria. Id. at 2531-32.
The Court also found that the relevant CWA program approval criteria
did not include consideration of endangered or threatened species, and
stated that ``[n]othing in the text of [the relevant CWA provision]
authorizes EPA to consider the protection of threatened or endangered
species as an end in itself when evaluating [an] application'' to
transfer a permitting program to a state. Id. at 2537. Accordingly, the
Court held that the CWA required EPA to approve the state's permitting
program if the statutory criteria were met; those criteria did not
include the consideration of ESA-protected species; and thus,
consistent with 50 CFR 402.03, the non-discretionary action to transfer
CWA permitting authority to the state did not trigger relevant ESA
section 7 requirements.
Similar to the CWA program approval provision at issue in Defenders
of Wildlife, section 110(k)(3) of the CAA mandates that EPA ``shall
approve'' a SIP submittal that meets applicable CAA requirements. 42
U.S.C. 7410(k)(3).
[[Page 76566]]
The CAA provides a list of SIP submittal criteria in section 110. See
42 U.S.C. 7410(a)(2).
Section 110(l), governing SIP revisions, states that each revision
``shall be adopted'' after reasonable public notice and public hearing,
as long as the revision does not interfere with any applicable
requirement concerning attainment and reasonable further progress or
any other applicable requirement of the CAA.
As was the case with the CWA requirements in Defenders of Wildlife,
the SIP requirements contained in section 110 of the CAA do not include
protection of listed species. Further, Title I, Parts C and D, of the
CAA do not explicitly state that consideration of the impacts on listed
species is a required factor in SIP approval decisions. EPA has
interpreted sections 169(3) and 165(e)(3)(B) of the CAA as providing
EPA with the relevant discretion to carry out ESA section 7(a)(2)
obligations during its review of individual applications for Federally
issued PSD permits under section 165. See In re Indeck-Elwood, LLC, PSD
appeal No. 03-04 (EAB Sept. 27, 2006), slip op. at 108 (holding EPA has
discretion to consider impacts on listed species in BACT and soils and
vegetation analyses). However, this discretion in PSD permitting
decisions does not provide EPA similar discretion in its SIP approval
decisions under section 110.
In issuing individual PSD permits, EPA is required to complete an
environmental impacts analysis in the BACT determination of CAA section
169(3) and an additional impacts analysis, including impacts on soils
and vegetation, under section 165(e)(3)(B) of the CAA. In carrying out
these analyses, EPA has interpreted these provisions as affording the
Agency discretion to determine whether listed species are impacted by
individual Federal PSD permitting decisions. In contrast, EPA's action
on state SIP submittals is governed by section 110 of the CAA, which
unequivocally directs EPA to approve state plans meeting applicable CAA
requirements.
Section 110 does not provide for similar impact analyses in
reviewing SIP submittals. An ESA obligation triggered by one provision
of the statute-consideration of ESA in individual Federal PSD
permitting decisions cannot be bootstrapped to raise that obligation in
another provision-approval of the revision to a SIP that does not
provide EPA with similar discretion. See, generally, Defenders of
Wildlife (finding that while EPA undertakes ESA consultation when
issuing individual Federal National Pollutant Discharge Environmental
System (NPDES) permits, it was not required to do so in approving state
NPDES permitting programs).
Applying the reasoning of Defenders of Wildlife, the SIP approval
criteria contained in the CAA do not provide EPA with the discretionary
authority to consider whether approval of SIP revisions may affect any
listed species. EPA has determined that WDNR has submitted a SIP
revision to incorporate the NSR Reform Rule that satisfies all of the
applicable SIP requirements contained in section 110 of the CAA. Thus,
given the Supreme Court precedent and applicable regulations (see 50
CFR 402.03), EPA is without discretion to disapprove or conditionally
approve Wisconsin's SIP revision request based on concerns for listed
species, and the ESA requirements cited by the commenter are thus
inapplicable to this approval action.
Comment IV: The Proposed Rules do not Reference 40 CFR 52.21 in
Order to Encompass Permits Issued by EPA and/or WDNR Under a Delegated
Program.
Response: EPA has considered the comment regarding the differences
in citations used with respect to the fuel use prohibition that is part
of the definition of a major modification. This provision was part of
Wisconsin's SIP prior to the requested change and is unaffected by
Wisconsin's requested revisions. It is, therefore, not before EPA for
approval. Moreover, this issue was never brought to WDNR's attention
during the public comment period during which WDNR sought approval by
the Wisconsin Natural Resources Board. Nevertheless, EPA has considered
this comment and agrees with the commenter that certain permits that
have been issued to sources within Wisconsin, to the extent that they
exist, may not be covered by the language in NR 405.02(21)(b)(5) and NR
408.02(20)(e)(5), which refers to permits that have established fuel
prohibiting conditions. Wisconsin's PSD program was approved into its
SIP on May 27, 1999. The rules cited above failed to incorporate
language that would include sources with construction permits issued
prior to that approval, either directly by EPA or by WDNR under a
delegated agreement in accordance with 40 CFR 52.21.
We have been in contact with WDNR on this matter, and plan to work
with WDNR to revise the language as appropriate. However, this
amendment is not required for EPA's approval of Wisconsin's requested
revisions, which did not include the omission of language referencing
40 CFR 52.21 and 40 CFR 51.166.
With respect to the commenter's contention that ``WDNR has
sometimes taken the position that the Mandatory Operating Permits
(MOPs) are not federally enforceable,'' it is EPA's understanding that
WDNR does not consider its MOP program to be federally enforceable.
Although WDNR submitted the MOP program to EPA as a SIP revision on
April 22, 1985, by letter dated June 20, 1990, WDNR withdrew that
request for approval, prior to EPA approving the program.
V. What action is EPA taking?
EPA is approving revisions to the PSD and NANSR construction permit
programs for the State of Wisconsin which Wisconsin submitted to EPA on
May 25, 2006. These revisions meet the minimum program requirements of
the December 31, 2002, EPA NSR Reform rulemaking, consistent with
subsequent changes to that rule, as set forth in New York v. EPA, and
the resulting December 21, 2007 rule concerning recordkeeping and
reporting standards.
VI. Statutory and Executive Order Reviews
Under the CAA, the Administrator is required to approve a SIP
submission that complies with the provisions of the CAA and applicable
Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in
reviewing SIP submissions, EPA's role is to approve state choices,
provided that they meet the criteria of the CAA. Accordingly, this
action merely approves state law as meeting Federal requirements and
does not impose additional requirements beyond those imposed by state
law. For that reason, this action:
Is not a ``significant regulatory action'' subject to
review by the Office of Management and Budget under Executive Order
12866 (58 FR 51735, October 4, 1993);
Does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
Is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
Does not contain any unfunded mandate or significantly or
uniquely affect small governments, as described in the Unfunded
Mandates Reform Act of 1995 (Pub. L. 104-4);
Does not have Federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
[[Page 76567]]
Is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
Is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);
Is not subject to requirements of section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the CAA; and
Does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human health or environmental
effects, using practicable and legally permissible methods, under
Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, this rule does not have tribal implications as
specified by Executive Order 13175 (65 FR 67249, November 9, 2000),
because the SIP is not approved to apply in Indian country located in
the state, and EPA notes that it will not impose substantial direct
costs on tribal governments or preempt tribal law.
The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this action and
other required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A major rule cannot
take effect until 60 days after it is published in the Federal
Register. This action is not a ``major rule'' as defined by 5 U.S.C.
804(2).
Under section 307(b)(1) of the CAA, petitions for judicial review
of this action must be filed in the United States Court of Appeals for
the appropriate circuit by February 17, 2009. Filing a petition for
reconsideration by the Administrator of this final rule does not affect
the finality of this action for the purposes of judicial review nor
does it extend the time within which a petition for judicial review may
be filed, and shall not postpone the effectiveness of such rule or
action. This action may not be challenged later in proceedings to
enforce its requirements. (See section 307(b)(2).)
List of Subjects in 40 CFR Part 52
Environmental protection, Air pollution control, Carbon monoxide,
Incorporation by reference, Intergovernmental relations, Lead, Nitrogen
dioxide, Ozone, Particulate matter, Reporting and recordkeeping
requirements, Sulfur oxides, Volatile organic compounds.
Dated: December 8, 2008.
Lynn Buhl,
Regional Administrator, Region 5.
0
40 CFR part 52 is amended as follows:
PART 52--[AMENDED]
0
1. The authority citation for part 52 continues to read as follows:
Authority: 42 U.S.C. 7401 et seq.
Subpart YY--Wisconsin
0
2. Section 52.2570 is amended by adding paragraph (c)(119) to read as
follows:
Sec. 52.2570 Identification of plan.
* * * * *
(c) * * *
(119) On May 25, 2006, Wisconsin submitted for EPA approval into
the Wisconsin SIP a revision relating to changes to chs. NR 405 and 408
for incorporation of Federal changes to the air permitting program. The
rule revision being approved in this action has been created to approve
rule AM-06-04, the NSR Reform provisions that were not vacated by the
DC Circuit Court in New York v. EPA, 413 F.3d 3 (DC Cir. 2005). The
rule revision also repeals NR 405.02(1)(d), (24m), (27)(a)8., 17 and 18
and 408.02(27). EPA has determined that this revision is approvable
under the Clean Air Act.
(i) Incorporation by reference. The following sections of the
Wisconsin Administrative Code are incorporated by reference:
(A) NR 405.01 Applicability; purpose. NR 405.01(1) and (2), as
published in the Wisconsin Administrative Register, June 30, 2007, No.
618, effective July 1, 2007.
(B) NR 405.02 Definitions. NR 405.02(1), (2m), (8), (11), (11c),
(11e), (11j), (12), (20m), (21), (24), (24j), (25b), (25d), (25e),
(25f), (25i), and (27m) as published in the Wisconsin Administrative
Register, June 30, 2007, No. 618, effective July 1, 2007.
(C) NR 405.025 Methods for calculation of increases in actual
emissions, as published in the Wisconsin Administrative Register, June
30, 2007, No. 618, effective July 1, 2007.
(D) NR 405.16 Source obligation. NR 405.16(3) and (4) as published
in the Wisconsin Administrative Register, June 30, 2007, No. 618,
effective July 1, 2007.
(E) NR 405.18 Plant-wide applicability limitations (PALs), as
published in the Wisconsin Administrative Register, June 30, 2007, No.
618, effective July 1, 2007.
(F) NR 408.02 Definitions. NR 408.02(1), (2m), (4), (5), (11),
(11e), (11m), (11s), (13), (13m), (20), (21)(a)1.(intro), (23), (24m),
(25s), (28e), (28j), (28m), (28s), (29m), and (32m) as published in the
Wisconsin Administrative Register, June 30, 2007, No. 618, effective
July 1, 2007.
(G) NR 408.025 Methods for calculation of increases in actual
emissions, as published in the Wisconsin Administrative Register, June
30, 2007, No. 618, effective July 1, 2007.
(H) NR 408.06 Emissions offsets. NR 408.06(10), as published in the
Wisconsin Administrative Register, June 30, 2007, No. 618, effective
July 1, 2007.
(I) NR 408.10 Source obligation. NR 408.10(5) and (6), as published
in the Wisconsin Administrative Register, June 30, 2007, No. 618,
effective July 1, 2007.
(J) NR 408.11 Plant-wide applicability limitations (PALs), as
published in the Wisconsin Administrative Register, June 30, 2007, No.
618, effective July 1, 2007.
(ii) Additional material.
(A) NR 484.04 Code of federal regulations appendices. NR
484.04(21), and (27m) as published in the Wisconsin Administrative
Register, June 30, 2007, No. 618, effective July 1, 2007.
* * * * *
[FR Doc. E8-29820 Filed 12-16-08; 8:45 am]
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