[Federal Register Volume 76, Number 9 (Thursday, January 13, 2011)]
[Proposed Rules]
[Pages 2294-2297]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-647]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52
[EPA-R09-OAR-2010-1078; FRL-9252-7]
Revision to the South Coast Portion of the California State
Implementation Plan, CPV Sentinel Energy Project AB 1318 Tracking
System
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed Rule.
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SUMMARY: The Environmental Protection Agency (EPA) is proposing to
approve a source-specific State Implementation Plan (SIP) revision for
the South Coast Air Quality Management District (District) portion of
the California SIP. This source-specific SIP revision is known as the
CPV Sentinel Energy Project AB 1318 Tracking System. The submitted SIP
revision, which consists of enabling language and the AB 1318 Tracking
System, supplements the District's SIP approved New Source Review (NSR)
program to allow the District to transfer offsetting emission
reductions for particulate matter less than 10 microns in diameter
(PM10) and one of its precursors, sulfur oxides
(SOX), to the CPV Sentinel Energy Project. The District's
SIP approved NSR program currently allows the District to provide
offsetting emission reductions for certain exempt sources and sources
that qualify as essential public services. The Sentinel Energy Project,
which will be a natural gas fired power plant, does not qualify under
either of these SIP approved exceptions. This proposed action
supplements the District's SIP to allow the District to transfer
offsetting emission reductions to the Sentinel Energy Project. In this
action, EPA is proposing to incorporate the District's enabling
language, which in turn incorporates the AB 1318 Tracking System by
reference into the SIP. EPA's proposal to approve this source-specific
SIP revision is based on finding that the offsetting emission
reductions the District has transferred to the AB 1318 Tracking System
meet the requirements of the Clean Air Act (CAA).
DATES: Comments on this Notice of Proposed Rulemaking (NPR) must be
submitted no later than February 14, 2011.
ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2010-1078, by one of the following methods:
1. Federal eRulemaking Portal: http://www.regulations.gov. Follow
the on-line instructions.
2. E-mail: [email protected].
3. Mail or deliver: Gerardo Rios (Air-3), U.S. Environmental
Protection Agency Region IX, 75 Hawthorne Street, San Francisco, CA
94105-3901.
Instructions: All comments will be included in the public docket
without change and may be made available online at www.regulations.gov,
including any personal information provided, unless the comment
includes Confidential Business Information (CBI) or other information
whose disclosure is restricted by statute. Information that you
consider CBI or otherwise protected should be clearly identified as
such and should not be submitted through http://www.regulations.gov or
e-mail. http://www.regulations.gov is an ``anonymous access'' system,
and EPA will not know your identity or contact information unless you
provide it in the body of your comment. If you send e-mail directly to
EPA, your e-mail address will be automatically captured and included as
part of the public comment. 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.
Docket: The index to the docket for this action is available
electronically at http://www.regulations.gov and in hard copy at EPA
Region IX, 75 Hawthorne Street, San Francisco, California. While all
documents in the docket are listed in the index, some information may
be publicly available only at the hard copy location (e.g., copyrighted
material), and some may not be publicly available in either location
(e.g., CBI). To inspect the hard copy materials, please schedule an
appointment during normal business hours with the contact listed in the
FOR FURTHER INFORMATION CONTACT section.
FOR FURTHER INFORMATION CONTACT: Laura Yannayon, EPA Region IX, (415)
972-3524, [email protected].
SUPPLEMENTARY INFORMATION: Throughout this document, ``we'', ``us'',
and ``our'' refer to EPA.
Table of Contents
I. Background
A. Facility Description and Background
B. Emission Offsets
C. Procedural History of Source Specific SIP Revision
II. Evaluation of Source Specific SIP Revision
A. What is in the SIP revision?
B. What are the Federal Clean Air Act requirements?
C. SIP Relaxation
D. Public Comment and Final Action
III. Administrative Requirements
A. Executive Order 12866, Regulatory Planning and Review
B. Paperwork Reduction Act
C. Regulatory Flexibility Act
D. Unfunded Mandates Reform Act
E. Executive Order 13132, Federalism
F. Executive Order 13175, Coordination With Indian Tribal
Governments
G. Executive Order 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. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Population
I. Background
A. Facility Description and Background
The proposed Sentinel Energy Project is designed to be a nominally
rated 850 megawatt electrical generating facility covering
approximately 37 acres within Riverside County, adjacent to Palm
Springs, California. The Sentinel Energy Project will emit air
pollutants from eight General Electric LMS100 combustion turbine
generators equipped with oxidation catalyst and selective catalytic
reduction equipment, eight single cell mechanical draft cooling towers,
and a 240 brake horsepower Tier III diesel emergency fire pump engine.
The California Energy Commission (CEC) approved the application for
certification for Sentinel on December 1, 2010. The District issued a
Final Determination of Compliance (FDOC) and an Addendum to the FDOC,
known as Appendix N, on March 2, 2010. Appendix N to the FDOC has
evolved into the AB 1318 Tracking System submitted as part of this SIP
revision. The CEC certification and the District's FDOC require the
Sentinel Energy Project to install and operate stringent emissions
controls to reduce emissions of NOX, VOC, CO and
PM10 to the lowest achievable emissions rates.
B. Emission Offsets
Pursuant to section 173 of the CAA, new major stationary sources
are required to provide offsetting emission reductions for any non-
attainment pollutants that continue to be emitted after operation of
the most stringent emissions controls, if those levels exceed certain
thresholds. 42 U.S.C. 7503(a)(1)(A). The District implements these
requirements through its NSR program in Regulation XIII, which EPA
approved into the SIP in 1996 as
[[Page 2295]]
meeting the requirements for CAA Section 110, Part D. 61 FR 64291.
The District estimated the amount of offsetting emission reductions
that Sentinel must provide to comply with District Rule 1303 and CAA
Sec. 173 for all non-attainment pollutants. For all pollutants other
than PM10 and SOX, Sentinel has purchased
Emission Reduction Credits (ERCs) on the open market. Those ERCs comply
with Rule 1309.
For PM10 and SOX emissions, the California
Legislature enacted California Assembly Bill (AB) 1318, which went into
effect on January 1, 2010. AB 1318 requires the District, upon making a
specified finding, to transfer SOX and PM10
emission offsets from its internal bank to eligible electric generating
facilities. The District determined that the Sentinel Energy Project
met all of the requirements of an eligible electric generating facility
and made the required finding.
AB 1318 also establishes requirements for the District's
implementation of transferring the offsetting emission reductions from
its internal bank to an eligible electric generating facility and for
tracking the transfer of offsetting emissions reductions. The District
completed those requirements as documented in Appendix N to the FDOC,
which has evolved into the AB 1318 Tracking System for this SIP
revision. The offsetting emission reductions transferred to the AB 1318
Tracking System from the District's internal bank were created by
permitted equipment that permanently ceased or reduced operations in
District. The District examined each of these offsetting emission
reductions and determined that they met the ``integrity criteria''
established in CAA Sec. 173(c). Specifically, the District determined
that the offsetting emission reductions were real, permanent,
quantifiable, enforceable and surplus. The District then transferred
those specific PM10 and SOX offsetting emission
reductions out of its internal bank and into the AB 1318 Tracking
System. These offsetting emission reductions are no longer available
for use in any other action.
The amounts of offsetting emission reductions the District
transferred from its internal bank to the AB 1318 Tracking System are
based on estimated actual PM10 and SOX emissions
reported to the District according to its Annual Emissions Reporting
Program. For each source of offsetting emission reductions from a
permanent shutdown of equipment, the District has inactivated that
source's permit. For each offsetting emission reduction created by a
source reducing emissions, the District has revised the source's
federally enforceable permit to ensure the reduction is permanent. The
complete list of PM10 and SOX offsetting emission
reductions is provided in the AB 1318 Tracking System which is attached
to EPA's Technical Support Document (TSD). Documentation for each of
these offsetting emission reductions is included in the docket for this
proposal.
C. Procedural History of Source Specific SIP Revision
The District adopted the CPV Sentinel Energy Project AB 1318
Tracking System on July 9, 2010. The California Air Resources Board
(CARB) submitted the CPV Sentinel Energy Project AB 1318 Tracking
System to EPA as a source specific SIP revision on September 10, 2010.
EPA issued a completeness letter on October 27, 2010, finding that the
submittal had met the completeness criteria in 40 CFR Part 51 Appendix
V.
II. Evaluation of Source Specific SIP Revision
A. What is in the SIP revision?
The package that the District, through CARB, submitted to EPA
consists of text to be included as a revision to the District's portion
of the California SIP, and the Sentinel Energy Project AB 1318 Tracking
System created to implement this new SIP provision. The District's SIP
text incorporates the Sentinel Energy Project AB 1318 Tracking System
by reference. The AB 1318 Tracking System includes specific offsetting
emission reductions that were identified from reductions of
SOX and PM10 occurring between 1999 and 2008 from
permitted equipment that has either permanently ceased operations in
the District or became subject to federally enforceable conditions that
reduced actual emissions. The District has not issued any Rule 1309
ERCs for these specific emissions reductions and has inactivated the
permits for the equipment that has been shut down. These SOX
and PM10 offsetting emission reductions were transferred out
of the District's internal bank and into the AB 1318 Tracking System.
These reductions have not been used by any other source and cannot be
used for any other source in the future if they are used to construct
the CPV Sentinel Energy Project. A copy of the AB 1318 Tracking System
for CPV Sentinel is included as an attachment to the TSD for this
action.
The text of the proposed source-specific SIP revision, in relevant
part, is:
The Executive Officer of the South Coast Air Quality Management
District shall transfer sulfur oxides and particulate emission
credits from the CPV Sentinel Energy Project AB 1318 Tracking
System, attached hereto and incorporated by reference herein, to
eligible electrical generating facilities pursuant to Health and
Safety Code section 40440.14, as in effect January 1, 2010, (i.e.
the CPV Sentinel Power Plant to be located in Desert Hot Springs,
CA) in the full amounts needed to issue permits to construct and to
meet requirements for sulfur oxides and particulate matter
emissions. Notwithstanding District Rule 1303, this SIP revision
provides a federally enforceable mechanism for transferring offsets
from the AQMD's internal accounts to the CPV Sentinel Project.
The SIP revision is intended to provide a federally approved and
enforceable mechanism for the District to transfer PM10 and
SOX offsetting emissions reductions from the District's
internal bank to the Sentinel Energy Project and to track those
emissions credits through the AB 1318 Tracking System.
B. What are the Federal Clean Air Act requirements?
The South Coast Air Basin is an extreme non-attainment area for
ozone and a serious non-attainment area for PM10. Sulfur
oxide emissions are PM10 precursors and are therefore also
treated as a PM10 non-attainment pollutant. As required by
CAA Sec. 110(a)(2)(C), SIPs are required to include provisions to
comply with CAA Part D for non-attainment pollutants. Among the Part D
requirements, Sec. 173(a)(1)(A) requires offsetting emission
reductions for new and modified major stationary sources. Section
173(c) requires the offsetting emission reductions to be real,
quantifiable, surplus, permanent, and enforceable.
The District's NSR permitting program is contained in District
Regulation XIII, which was approved into the South Coast portion of the
California SIP on December 4, 1996, for purposes of complying with the
CAA Part D. (61 FR 64291). District Rule 1303(b)(2) requires the
District to deny a permit to construct a new source or modify an
existing source unless it is exempt from offset requirements pursuant
to Rule 1304, emissions increases are offset by ERCs approved pursuant
to Rule 1309, or the source obtains allocations from the District's
Priority Reserve accounts in accordance with the provisions of Rule
1309.1. For PM10 and SOX emissions, Sentinel is
not exempt pursuant to Rule 1304 and does not qualify for allocations
from the Priority Reserve.\1\
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\1\ When sources are exempt from offsets pursuant to Rule 1304
or entitled to allocations pursuant to Rule 1309.1, the District
deducts sufficient emission credits from its internal bank of
credits to offset any emissions that would be subject to Federal
offset requirements. The District prepares annual reports to show
that it has adequate emissions credits in its internal bank.
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[[Page 2296]]
However, the California legislature directed the District to
provide offsetting emission reductions from the District's internal
bank to the Sentinel Energy Project (providing it qualified) to offset
its PM10 and SOX emissions. This source-specific
SIP revision approves the Sentinel Energy Project AB 1318 Tracking
System to provide the federally enforceable mechanism allowing the
District to transfer PM10 and SOX offsetting
emission reductions to meet the requirements of Rule 1303(b).
EPA has reviewed the documents provided for each offsetting
emission reduction the District has transferred to the AB 1318 Tracking
System. We are proposing to find that the PM10 and
SOX offsetting emission reductions transferred to the AB
1318 Tracking System meet the CAA Section 173 requirements that
emission reductions used as offsets be real, quantifiable, surplus,
permanent, and enforceable prior to use. The TSD for this action
provides more detail regarding how the offsetting emission reductions
transferred to the AB 1318 Tracking System meet these requirements.
C. SIP Relaxation
Under section 110(l) of the CAA, EPA may not approve any SIP
revision that would interfere with attainment, reasonable further
progress (RFP) or any other CAA requirement.
We believe this revision will not interfere with attainment or RFP
because the emission credits in the AB 1318 Tracking System are not
relied on for attainment or RFP in the District's most recent
attainment demonstrations. We are also not aware of this revision
interfering with any other CAA requirement. For example, this source-
specific SIP revision provides a new but equivalent mechanism to
provisions in Regulation XIII for satisfying the offset requirements of
CAA Sec. 173 because the offsetting emission reductions the District
is transferring from its internal bank to the AB 1318 Tracking System
meet all Federal requirements. In addition, the District supplied a
copy of its air quality analysis for the CPV Sentinel Energy Project
which shows that operation of the facility will not interfere with the
ability of the District to reach attainment.\2\
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\2\ Air Quality Demonstration: SIP Revision for CPV Sentinel
Energy Project
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D. Public Comment and Final Action
Because EPA believes the submittal fulfills all relevant
requirements, we are proposing to fully approve it as described in
section 110(k)(3) of the Act. We will accept comments from the public
on this proposal for the next 30 days. Unless we receive convincing new
information during the comment period, we intend to publish a final
approval action that will incorporate this submittal into the federally
enforceable SIP.
III. Administrative Requirements
A. Executive Order 12866, Regulatory Planning and Review
The Office of Management and Budget (OMB) has exempted this
regulatory action from Executive Order 12866, entitled ``Regulatory
Planning and Review.''
B. Paperwork Reduction Act
This action does not impose an information collection burden under
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.
Burden is defined at 5 CFR 1320.3(b).
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency
to conduct a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements unless the agency certifies
that the rule will not have a significant economic impact on a
substantial number of small entities. Small entities include small
businesses, small not-for-profit enterprises, and small governmental
jurisdictions.
This rule will not have a significant impact on a substantial
number of small entities because SIP approvals under section 110 and
subchapter I, part D of the Clean Air Act do not create any new
requirements but simply approve requirements that the State is already
imposing. Therefore, because the Federal SIP approval does not create
any new requirements, I certify that this action will not have a
significant economic impact on a substantial number of small entities.
Moreover, due to the nature of the Federal-State relationship under
the Clean Air Act, preparation of flexibility analysis would constitute
Federal inquiry into the economic reasonableness of State action. The
Clean Air Act forbids EPA to base its actions concerning SIPs on such
grounds. Union Electric Co., v. U.S. EPA, 427 U.S. 246, 255-66 (1976);
42 U.S.C. 7410(a)(2).
D. Unfunded Mandates Reform Act
Under sections 202 of the Unfunded Mandates Reform Act of 1995
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA
must prepare a budgetary impact statement to accompany any proposed or
final rule that includes a Federal mandate that may result in estimated
costs to State, local, or tribal governments in the aggregate; or to
the private sector, of $100 million or more. Under section 205, EPA
must select the most cost-effective and least burdensome alternative
that achieves the objectives of the rule and is consistent with
statutory requirements. Section 203 requires EPA to establish a plan
for informing and advising any small governments that may be
significantly or uniquely impacted by the rule.
EPA has determined that the approval action proposed does not
include a Federal mandate that may result in estimated costs of $100
million or more to either State, local, or tribal governments in the
aggregate, or to the private sector. This Federal action proposes to
approve pre-existing requirements under State or local law, and imposes
no new requirements. Accordingly, no additional costs to State, local,
or tribal governments, or to the private sector, result from this
action.
E. Executive Order 13132, Federalism
Federalism (64 FR 43255, August 10, 1999) revokes and replaces
Executive Orders 12612 (Federalism) and 12875 (Enhancing the
Intergovernmental Partnership). Executive Order 13132 requires EPA to
develop an accountable process to ensure ``meaningful and timely input
by State and local officials in the development of regulatory policies
that have federalism implications.'' ``Policies that have federalism
implications'' is defined in the Executive Order to include regulations
that have ``substantial direct effects on the States, on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government.'' Under Executive Order 13132, EPA may not issue a
regulation that has federalism implications, that imposes substantial
direct compliance costs, and that is not required by statute, unless
the Federal Government provides the funds necessary to pay the direct
compliance costs incurred by State and local governments, or EPA
consults with State and local officials early in the process of
developing the proposed regulation. EPA also may not issue a
[[Page 2297]]
regulation that has federalism implications and that preempts State law
unless the Agency consults with State and local officials early in the
process of developing the proposed regulation.
This rule will not have substantial direct effects on the States,
on the relationship between the national government and the States, or
on the distribution of power and responsibilities among the various
levels of government, as specified in Executive Order 13132, because it
merely approves a State rule implementing a Federal standard, and does
not alter the relationship or the distribution of power and
responsibilities established in the Clean Air Act. Thus, the
requirements of section 6 of the Executive Order do not apply to this
rule.
F. Executive Order 13175, Coordination With Indian Tribal Governments
Executive Order 13175, entitled ``Consultation and Coordination
with Indian Tribal Governments'' (65 FR 67249, November 9, 2000),
requires EPA to develop an accountable process to ensure ``meaningful
and timely input by tribal officials in the development of regulatory
policies that have tribal implications.'' This proposed rule does not
have tribal implications, as specified in Executive Order 13175. It
will not have substantial direct effects on tribal governments, on the
relationship between the Federal Government and Indian tribes, or on
the distribution of power and responsibilities between the Federal
Government and Indian tribes. Thus, Executive Order 13175 does not
apply to this rule.
G. Executive Order 13045, Protection of Children From Environmental
Health Risks and Safety Risks
EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997)
as applying only to those regulatory actions that concern health or
safety risks, such that the analysis required under section 5-501 of
the Executive Order has the potential to influence the regulation. This
rule is not subject to Executive Order 13045, because it approves a
State rule implementing a Federal standard.
H. Executive Order 13211, Actions That Significantly Affect Energy
Supply, Distribution, or Use
This rule is not subject to Executive Order 13211, ``Actions
Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or Use'' (66 FR 28355, May 22, 2001) because it is not a
significant regulatory action under Executive Order 12866.
I. National Technology Transfer and Advancement Act
Section 12 of the National Technology Transfer and Advancement Act
(NTTAA) of 1995 requires Federal agencies to evaluate existing
technical standards when developing a new regulation. To comply with
NTTAA, EPA must consider and use ``voluntary consensus standards''
(VCS) if available and applicable when developing programs and policies
unless doing so would be inconsistent with applicable law or otherwise
impractical.
The EPA believes that VCS are inapplicable to this action. Today's
action does not require the public to perform activities conducive to
the use of VCS.
J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Population
Executive Order 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
Federal executive policy on environmental justice. Its main provision
directs Federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
EPA lacks the discretionary authority to address environmental
justice in this rulemaking.
List of Subjects in 40 CFR Part 52
Environmental protection, Air pollution control, Intergovernmental
relations, Particulate matter, Reporting and recordkeeping
requirements.
Authority: 42 U.S.C. 7401 et seq.
Dated: December 30, 2010.
Jared Blumenfeld,
Regional Administrator, Region IX.
[FR Doc. 2011-647 Filed 1-12-11; 8:45 am]
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