Approval and Promulgation of Implementation Plans; Alabama; Clean Air Interstate Rule, 55659-55664 [E7-19352]

Download as PDF Federal Register / Vol. 72, No. 189 / Monday, October 1, 2007 / Rules and Regulations this action is not economically significant. The corrections are not subject to Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use (66 FR 28355, May 22, 2001) because this action is not a significant regulatory action under Executive Order 12866. The corrections do not involve changes to technical standards related to test methods or monitoring methods; thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272) do not apply. The corrections also do not involve special consideration of environmental justice-related issues as required by Executive Order 12898, Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations (59 FR 7629, February 16, 1994). The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), 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. The EPA will submit a report containing this final action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the U.S. prior to publication of this action in the Federal Register. This action is not a ‘‘major rule’’ as defined by 5 U.S.C. 804(2). The final rule will be effective on October 1, 2007. The EPA’s compliance with the above statutes and Executive Orders for the underlying rules is discussed in Section X of the CAIR at 70 FR 25305 and in Section IX of the CAIR FIPs at 71 FR 25365. List of Subjects jlentini on PROD1PC65 with RULES 40 CFR Part 51 Environmental protection, Administrative practice and procedure, Air pollution control, Electric utilities, Intergovernmental relations, Nitrogen oxides, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur dioxide. 40 CFR Part 97 Environmental protection, Administrative practice and procedure, Air pollution control, Electric utilities, Intergovernmental relations, Nitrogen oxides, Reporting and recordkeeping requirements, Sulfur dioxide. VerDate Aug<31>2005 17:12 Sep 28, 2007 Jkt 214001 Dated: September 25, 2007. Stephen L. Johnson, Administrator. For the reasons set forth in the preamble, parts 51 and 97 of title 40, chapter I of the Code of Federal Regulations are amended as follows: I PART 51—[AMENDED] 1. The authority citation for part 51 continues to read as follows: I Authority: 23 U.S.C. 101; 42 U.S.C. 7401– 7671q. § 51.125 [Amended] 2. Section 51.125 is amended as follows: I a. In paragraph (a)(1), by removing the word ‘‘Columbia’’ and adding in its place the words ‘‘Columbia must report annual (12 months) emissions of SO2 and NOX’’. I b. In paragraph (a)(2), by removing the word ‘‘Deleware’’ and adding in its place the word ‘‘Delaware’’, by removing the word ‘‘Indinia’’ and adding in its place ‘‘Indiana’’, and by removing the word ‘‘Lousianna’’ and adding in its place ‘‘Louisiana’’. I PART 97—[AMENDED] 3. The authority citation for part 97 continues to read as follows: I Authority: 42 U.S.C. 7401, 7403, 7410, 7426, 7601, and 7651, et seq. Appendix A to Subpart EEEE of Part 97 [Amended] 4. Appendix A to Subpart EEEE is amended by revising the citation ‘‘97.344(a)’’ to read ‘‘97.343(a)’’. I [FR Doc. E7–19323 Filed 9–28–07; 8:45 am] BILLING CODE 6560–50–P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA–R04–OAR–2007–0359–200736; FRL– 8475–9] Approval and Promulgation of Implementation Plans; Alabama; Clean Air Interstate Rule Environmental Protection Agency (EPA). ACTION: Final rule. AGENCY: SUMMARY: EPA is taking final action to approve a revision to the Alabama State Implementation Plan (SIP) submitted on March 7, 2007. The Alabama Department of Environmental Management (ADEM) also previously submitted a final submittal dated June PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 55659 16, 2006, which was subsequently updated in a prehearing request for parallel processing on November 16, 2006, to comply with EPA’s revisions to the model rule. Alabama’s final March 7, 2007, submittal replaces the State’s June 16, 2006, and November 16, 2006, submittals. This revision addresses the requirements of EPA’s Clean Air Interstate Rule (CAIR) promulgated on May 12, 2005, and subsequently revised on April 28, 2006, and December 13, 2006. EPA has determined that the SIP revision fully implements the CAIR requirements for Alabama. As a result of this action, EPA will also withdraw, through a separate rulemaking, the CAIR Federal Implementation Plans (FIPs) concerning sulfur dioxide (SO2), nitrogen oxides (NOX) annual, and NOX ozone season emissions for Alabama. The CAIR FIPs for all States in the CAIR region were promulgated on April 28, 2006, and subsequently revised on December 13, 2006. CAIR requires States to reduce emissions of SO2 and NOX that significantly contribute to, and interfere with maintenance of, the National Ambient Air Quality Standards (NAAQS) for fine particulates (PM2.5) and/or ozone in any downwind state. CAIR establishes State budgets for SO2 and NOX and requires States to submit SIP revisions that implement these budgets in States that EPA concluded did contribute to nonattainment in downwind states. States have the flexibility to choose which control measures to adopt to achieve the budgets, including participating in the EPA-administered cap-and-trade programs. In the SIP revision that EPA is approving, Alabama has met the CAIR requirements by electing to participate in the EPA-administered cap-and-trade programs addressing SO2, NOX annual, and NOX ozone season emissions. DATES: This rule is effective on October 31, 2007. ADDRESSES: EPA has established a docket for this action under Docket ID No. EPA–R04–OAR–2007–0359. 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 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 Regulatory Development Section, E:\FR\FM\01OCR1.SGM 01OCR1 55660 Federal Register / Vol. 72, No. 189 / Monday, October 1, 2007 / Rules and Regulations Air Planning Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street, SW., Atlanta, Georgia 30303–8960. EPA requests that if at all possible, you contact the person listed in the FOR FURTHER INFORMATION CONTACT section to schedule your inspection. The Regional Office’s official hours of business are Monday through Friday, 8:30 to 4:30 excluding federal holidays. FOR FURTHER INFORMATION CONTACT: Stacy Harder, Regulatory Development Section, Air Planning Branch, Air, Pesticides and Toxics Management Division, Region 4, U.S. Environmental Protection Agency, 61 Forsyth Street, SW., Atlanta, Georgia 30303–8960. The telephone number is (404) 562–9042. Ms. Harder can also be reached via electronic mail at harder.stacy@epa.gov. SUPPLEMENTARY INFORMATION: Throughout this document whenever ‘‘we,’’ ‘‘us,’’ or ‘‘our’’ is used, we mean EPA. jlentini on PROD1PC65 with RULES Table of Contents I. What Action Is EPA Taking? II. What Is the Regulatory History of CAIR and the CAIR FIPs? III. What Are the General Requirements of CAIR and the CAIR FIPs? IV. Analysis of Alabama’s CAIR SIP Submittal A. State Budgets for Allowance Allocations B. CAIR Cap-and-Trade Programs C. NOX Allowance Allocations D. Allocation of NOX Allowances From the Compliance Supplement Pool E. Individual Opt-in Units V. Final Action VI. Statutory and Executive Order Reviews I. What Action Is EPA Taking? EPA is taking final action to approve a revision to Alabama’s SIP submitted on March 7, 2007. In its SIP revision, Alabama has met the CAIR requirements by requiring certain electric generating units (EGUs) to participate in the EPAadministered State CAIR cap-and-trade programs addressing SO2, NOX annual, and NOX ozone season emissions. Alabama’s regulations adopt by reference most of the provisions of EPA’s SO2, NOX annual, and NOX ozone season model trading rules, with certain changes discussed below. EPA has determined that the SIP as revised will meet the applicable requirements of CAIR. As a result of this action, the Administrator of EPA will also issue a final rule to withdraw the FIPs concerning SO2, NOX annual, and NOX ozone season emissions for Alabama. The Administrator’s action will delete and reserve 40 CFR 52.54 and 40 CFR 52.55, relating to the CAIR FIP obligations for Alabama. The VerDate Aug<31>2005 17:12 Sep 28, 2007 Jkt 214001 withdrawal of the CAIR FIPs for Alabama is a conforming amendment that must be made once the SIP is approved because EPA’s authority to issue the FIPs was premised on a deficiency in the SIP for Alabama. Once a SIP is fully approved, EPA no longer has authority for the FIPs. Thus, EPA does not have the option of maintaining the FIPs following full SIP approval. Accordingly, EPA does not intend to offer an opportunity for a public hearing or an additional opportunity for written public comment on the withdrawal of the FIPs. EPA proposed to approve Alabama’s request to amend the SIP on July 12, 2007 (72 FR 38045). In that proposal, EPA also stated its intent to withdraw the FIP, as described above. The comment period closed on August 13, 2007. No comments were received. EPA is finalizing the approval as proposed based on the rationale stated in the proposal and in this final action. II. What is the Regulatory History of CAIR and the CAIR FIPs? The CAIR was published by EPA on May 12, 2005 (70 FR 25162). In this rule, EPA determined that 28 States and the District of Columbia contribute significantly to nonattainment and interfere with maintenance of the NAAQS for PM2.5 and/or 8-hour ozone in downwind States in the eastern part of the country. As a result, EPA required those upwind States to revise their SIPs to include control measures that reduce emissions of SO2, which is a precursor to PM2.5 formation, and/or NOX, which is a precursor to both ozone and PM2.5 formation. For jurisdictions that contribute significantly to downwind PM2.5 nonattainment, CAIR sets annual State-wide emission reduction requirements (i.e., budgets) for SO2 and annual State-wide emission reduction requirements for NOX. Similarly, for jurisdictions that contribute significantly to 8-hour ozone nonattainment, CAIR sets State-wide emission reduction requirements for NOX for the ozone season (May 1 to September 30). Under CAIR, States may implement these reduction requirements by participating in the EPA-administered cap-and-trade programs or by adopting any other control measures. CAIR explains to subject States what must be included in SIPs to address the requirements of section 110(a)(2)(D) of the Clean Air Act (CAA) with regard to interstate transport with respect to the 8-hour ozone and PM2.5 NAAQS. EPA made national findings, effective on May 25, 2005, that the States had failed to submit SIPs meeting the requirements PO 00000 Frm 00006 Fmt 4700 Sfmt 4700 of section 110(a)(2)(D). The SIPs were due in July 2000, three years after the promulgation of the 8-hour ozone and PM2.5 NAAQS. III. What Are the General Requirements of CAIR and the CAIR FIPs? CAIR establishes State-wide emission budgets for SO2 and NOX and is to be implemented in two phases. The first phase of NOX reductions starts in 2009 and continues through 2014, while the first phase of SO2 reductions starts in 2010 and continues through 2014. The second phase of reductions for both NOX and SO2 starts in 2015 and continues thereafter. CAIR requires States to implement the budgets by either: (1) Requiring EGUs to participate in the EPA-administered cap-and-trade programs; or (2) adopting other control measures of the State’s choosing and demonstrating that such control measures will result in compliance with the applicable State SO2 and NOX budgets. The May 12, 2005, and April 28, 2006, CAIR rules provide model rules that States must adopt (with certain limited changes, if desired) if they want to participate in the EPA-administered trading programs. With two exceptions, only States that choose to meet the requirements of CAIR through methods that exclusively regulate EGUs are allowed to participate in the EPA-administered trading programs. One exception is for States that adopt the opt-in provisions of the model rules to allow non-EGUs individually to opt into the EPAadministered trading programs. The other exception is for States that include all non-EGUs from their NOX SIP Call trading programs in their CAIR NOX ozone season trading programs. IV. Analysis of Alabama’s CAIR SIP Submittal A. State Budgets for Allowance Allocations In this action, EPA is taking final action to approve Alabama’s SIP revision that adopts the following budgets for the State, i.e., 69,020 (2009– 2014) and 57,517 (2015–thereafter) tons for NOX annual emissions, 34,510 (2009–2014) and 29,146 (2015– thereafter) tons for NOX ozone season emissions, and 157,582 (2010–2014) and 110,307 (2015–thereafter) tons for SO2 emissions. The NOX ozone season budget properly reflects the inclusion of NOX SIP Call trading program units in the CAIR NOX ozone season trading program, as discussed below. Alabama’s SIP revision sets these budgets as the total amounts of allowances available E:\FR\FM\01OCR1.SGM 01OCR1 Federal Register / Vol. 72, No. 189 / Monday, October 1, 2007 / Rules and Regulations jlentini on PROD1PC65 with RULES for allocation for each year under the EPA-administered cap-and-trade programs. B. CAIR Cap-and-Trade Programs The CAIR NOX annual and ozone season model trading rules both largely mirror the structure of the NOX SIP Call model trading rule in 40 CFR part 96, subparts A through I. While the provisions of the NOX annual and ozone season model rules are similar, there are some differences. For example, the NOX annual model rule (but not the NOX ozone season model rule) provides for a compliance supplement pool (CSP), which is discussed below and under which allowances may be awarded for early reductions of NOX annual emissions. As a further example, the NOX ozone season model rule reflects the fact that the CAIR NOX ozone season trading program replaces the NOX SIP Call trading program after the 2008 ozone season and is coordinated with the NOX SIP Call program. The NOX ozone season model rule provides incentives for early emissions reductions by allowing banked, pre2009 NOX SIP Call allowances to be used for compliance in the CAIR NOX ozone season trading program. In addition, States have the option of continuing to meet their NOX SIP Call requirement by participating in the CAIR NOX ozone season trading program and including all their NOX SIP Call trading sources in that program. The provisions of the CAIR SO2 model rule are also similar to the provisions of the NOX annual and ozone season model rules. However, the SO2 model rule is coordinated with the ongoing Acid Rain SO2 cap-and-trade program under CAA title IV. The SO2 model rule uses the title IV allowances for compliance, with each allowance allocated for 2010–2014 authorizing only 0.50 ton of emissions and each allowance allocated for 2015 and thereafter authorizing only 0.35 ton of emissions. Banked title IV allowances allocated for years before 2010 can be used at any time in the CAIR SO2 capand-trade program, with each such allowance authorizing one ton of emissions. Title IV allowances are to be freely transferable among sources covered by the Acid Rain Program and sources covered by the CAIR SO2 capand-trade program. EPA also used the CAIR model trading rules as the basis for the trading programs in the CAIR FIPs. The CAIR FIP trading rules are virtually identical to the CAIR model trading rules, with changes made to account for Federal rather than State implementation. The CAIR model SO2, NOX annual, and NOX VerDate Aug<31>2005 17:12 Sep 28, 2007 Jkt 214001 ozone season trading rules and the respective CAIR FIP trading rules are designed to work together as integrated SO2, NOX annual, and NOX ozone season trading programs. In the SIP revision, Alabama has chosen to implement its CAIR budgets by requiring EGUs to participate in EPAadministered cap-and-trade programs for SO2, NOX annual, and NOX ozone season emissions. Alabama has adopted a full SIP revision (with the revisions discussed above) that adopts, with certain allowed changes discussed below, the CAIR model cap-and-trade rules for SO2, NOX annual, and NOX ozone season emissions. C. Applicability Provisions for Non-EGU NOX SIP Call Sources In general, the CAIR model trading rules apply to any stationary, fossil-fuelfired boiler or stationary, fossil-fuelfired combustion turbine serving at any time, since the later of November 15, 1990 or the start-up of the unit’s combustion chamber, a generator with nameplate capacity of more than 25 MWe producing electricity for sale. States have the option of bringing in, for the CAIR NOX ozone season program only, those units in the State’s NOX SIP Call trading program that are not EGUs as defined under CAIR. States exercising this option need to add the applicability provisions in the State’s NOX SIP Call trading rule for non-EGUs to the applicability provisions in 40 CFR 96.304 in order to include in the CAIR NOX ozone season trading program all units required to be in the State’s NOX SIP Call trading program that are not already included under 40 CFR 96.304. Under this option, the CAIR NOX ozone season program must cover all large industrial boilers and combustion turbines, as well as any small EGUs (i.e. units serving a generator with a nameplate capacity of 25 MWe or less) that the State currently requires to be in the NOX SIP Call trading program. Alabama has chosen to expand the applicability provisions of the CAIR NOX ozone season trading program to include all non-EGUs in the State’s NOX SIP Call trading program. D. NOX Allowance Allocations Under the NOX allowance allocation methodology in the CAIR model trading rules and in the CAIR FIP, NOX annual and ozone season allowances are allocated to units that have operated for five years, based on heat input data from a three-year period that are adjusted for fuel type by using fuel factors of 1.0 for coal, 0.6 for oil, and 0.4 for other fuels. The CAIR model trading rules and the CAIR FIP also provide a new unit set- PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 55661 aside from which units without five years of operation are allocated allowances based on the units’ prior year emissions. States may establish in their SIP submissions a different NOX allowance allocation methodology that will be used to allocate allowances to sources in the States if certain requirements are met concerning the timing of submission of units’ allocations to the Administrator for recordation and the total amount of allowances allocated for each control period. In adopting alternative NOX allowance allocation methodologies, States have flexibility with regard to: (1) The cost to recipients of the allowances, which may be distributed for free or auctioned; (2) the frequency of allocations; (3) the basis for allocating allowances, which may be distributed, for example, based on historical heat input or electric and thermal output; and (4) the use of allowance set-asides and, if used, their size. Alabama has chosen to replace the provisions of the CAIR NOX annual and CAIR NOX ozone season model trading rules concerning the allocation of allowances with its own methodology. Alabama has chosen to distribute NOX annual allowances based upon allocation methods for existing, replacement, and new units. As explained in the proposed approval, EPA understands that the language is intended to mean that allocations will be determined by the dates and only for the years identified or described in 40 CFR 96.141 and 40 CFR 96.341. EPA did not receive any comments on this issue, and concludes that this understanding is a correct interpretation of Alabama’s rules. Additionally, Alabama’s CAIR NOX Annual and CAIR NOX ozone season rules establish permanent allocations for specified units designated as ‘‘existing units’’ or ‘‘new units’’ and do not include provisions of the EPA’s model rules that call for adjusting the allocations for existing units to provide allocations for future, new units. Finally, Alabama’s CAIR NOX ozone season rule includes special provisions concerning the allocation of allowances for the 2009 control period. As discussed above, Alabama’s rule expanded the applicability provisions of the model rule to include—as CAIR NOX ozone season units—those units in Alabama’s NOX SIP Call program (i.e., Alabama’s NOX Budget Trading Program) that are not covered by model rule applicability provisions. Alabama already issued NOX allowances to some of those units for 2009 under the NOX Budget Trading Program. Alabama’s rule E:\FR\FM\01OCR1.SGM 01OCR1 55662 Federal Register / Vol. 72, No. 189 / Monday, October 1, 2007 / Rules and Regulations jlentini on PROD1PC65 with RULES (in Rule 335–3.8–.29(3)(d)1.(i)) states that, if a unit was allocated more allowances under the NOX Budget Trading Program for 2009 than it would otherwise be allocated under Alabama’s allocation provisions generally applicable to CAIR NOX ozone season units, then the Department ‘‘will allocate the same number of CAIR Ozone Season allowances’’ to that unit. The allocations to other units under the generally applicable allocation provisions will be reduced for 2009 in order to take account of this adjustment of the NOX Budget Trading Program unit’s 2009 allocation. Further, Alabama’s rule (in Rule 335–3.8– .29(2)(a)1.) states that, for the 2009 control period, the Department will submit to the Administrator, for the purpose of recording allocations, ‘‘only the difference between the CAIR NOX Ozone Season allowance allocations and the 2009 NOX Budget Trading Program allowance allocations.’’ In short, Alabama’s rule treats each unit’s 2009 NOX Budget Trading Program allocation as a 2009 CAIR NOX ozone season allocation for that unit that has been previously recorded by the Administrator. EPA therefore interprets Alabama’s rule to provide that each 2009 NOX Budget Trading Program allowance is a 2009 CAIR NOX ozone season allowance, whether the NOX Budget Trading Program allowance is still held by the owners and operators of the unit or has been transferred to other parties. Consistent with this interpretation of Alabama’s rule, the Administrator—in operating the CAIR NOX Ozone Season Tracking System— will treat each such allowance as usable for compliance with the allowanceholding requirements of the CAIR NOX Ozone Season Trading Program by any CAIR NOX ozone season source that holds the allowances in the source’s compliance account as of the allowance transfer deadline, regardless of the State in which the source is located. EPA is taking final action to approve the above-described variations in Alabama’s rule from the model rule provisions because the changes are consistent with the flexibility that CAIR provides States with regard to allocation methodologies. E. Allocation of NOX Allowances From the Compliance Supplement Pool The CAIR establishes a compliance supplement pool to provide an incentive for early reductions in NOX annual emissions. The CSP consists of 200,000 CAIR NOX annual allowances of vintage 2009 for the entire CAIR region, and a State’s share of the CSP is based upon the projected magnitude of VerDate Aug<31>2005 17:12 Sep 28, 2007 Jkt 214001 the emission reductions required by CAIR in that State. States may distribute CSP allowances, one allowance for each ton of early reduction, to sources that make NOX reductions during 2007 or 2008 beyond what is required by any applicable State or Federal emission limitation. States also may distribute CSP allowances based upon a demonstration of need for an extension of the 2009 deadline for implementing emission controls. The CAIR annual NOX model trading rule establishes specific methodologies for allocations of CSP allowances. States may choose an allowed, alternative CSP allocation methodology to be used to allocate CSP allowances to sources in the States. Alabama has chosen to modify the provisions from the CAIR NOX annual model trading rule concerning the allocation of allowances from the CSP. Alabama has chosen to distribute CSP allowances using an allocation methodology that allows the Department to allocate up to 10,166 additional CAIR NOX allowances for the control period in 2009. CAIR NOX units that achieve emissions reductions in 2007 and 2008, that are not necessary to comply with applicable emissions limitations during those years, may request early reduction credits. The units requesting CSP allocations must submit a request by May 1, 2009, to ADEM. Sources are eligible to receive CSP allowances only to the extent that that the total number of allowances issued does not exceed 15 percent of the total number of NOX allowances issued to that unit from the initial allowance allocation. Any remaining CSP allowances after the initial distribution will be allocated to eligible units on a pro rata basis, provided that no unit is issued more allowances than the early reduction credits requested by that unit in accordance with ADEM’s CSP provisions. F. Individual Opt-In Units The opt-in provisions of the CAIR SIP model trading rules allow certain nonEGUs (i.e., boilers, combustion turbines, and other stationary fossil-fuel-fired devices) that do not meet the applicability criteria for a CAIR trading program to participate voluntarily in (i.e., opt into) the CAIR trading program. A non-EGU may opt into one or more of the CAIR trading programs. In order to qualify to opt into a CAIR trading program, a unit must vent all emissions through a stack and be able to meet monitoring, recordkeeping, and recording requirements of 40 CFR part 75. The owners and operators seeking to opt a unit into a CAIR trading program PO 00000 Frm 00008 Fmt 4700 Sfmt 4700 must apply for a CAIR opt-in permit. If the unit is issued a CAIR opt-in permit, the unit becomes a CAIR unit, is allocated allowances, and must meet the same allowance-holding and emissions monitoring and reporting requirements as other units subject to the CAIR trading program. The opt-in provisions provide for two methodologies for allocating allowances for opt-in units, one methodology that applies to opt-in units in general and a second methodology that allocates allowances only to opt-in units that the owners and operators intend to repower before January 1, 2015. States have several options concerning the opt-in provisions. States may adopt the CAIR opt-in provisions entirely or may adopt them but exclude one of the methodologies for allocating allowances. States may also decline to adopt the opt-in provisions at all. Alabama has chosen to allow nonEGUs meeting certain requirements to opt into the CAIR trading programs by adopting by reference the entirety of EPA’s model rule provisions for opt-in units in the CAIR SO2, CAIR NOX annual, and CAIR NOX ozone season trading programs. V. Final Action EPA is taking final action to approve Alabama’s full CAIR SIP revision submitted on March 7, 2007. Under this SIP revision, Alabama is choosing to participate in the EPA-administered cap-and-trade programs for SO2, NOX annual, and NOX ozone season emissions. EPA has determined that the SIP revision meets the applicable requirements in 40 CFR 51.123(o) and (aa), with regard to NOX annual and NOX ozone season emissions, and 40 CFR 51.124(o), with regard to SO2 emissions. EPA has determined that the SIP as revised will meet the requirements of CAIR. The Administrator of EPA will also issue, without providing an opportunity for a public hearing or an additional opportunity for written public comment, a final rule to withdraw the CAIR FIPs concerning SO2, NOX annual, and NOX ozone season emissions for Alabama. The Administrator’s action will delete and reserve 40 CFR 52.54 and 40 CFR 52.55. EPA will take final action to withdraw the CAIR FIPs for Alabama in a separate rulemaking. VI. Statutory and Executive Order Reviews Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a ‘‘significant regulatory action’’ and therefore is not subject to review by the Office of Management and Budget. For E:\FR\FM\01OCR1.SGM 01OCR1 55663 Federal Register / Vol. 72, No. 189 / Monday, October 1, 2007 / Rules and Regulations this reason, this action is also not subject to Executive Order 13211, ‘‘Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use’’ (66 FR 28355, May 22, 2001). This action merely approves State law as meeting Federal requirements and would impose no additional requirements beyond those imposed by State law. Accordingly, the Administrator certifies that this rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). Because this action approves pre-existing requirements under State law and does not impose any additional enforceable duty beyond that required by State law, it 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). This rule also does not have tribal implications because it will not have a substantial direct effect on one or more Indian tribes, 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, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This action also does not have Federalism implications because it does 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 (64 FR 43255, August 10, 1999). This action 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 CAA. This rule also is not subject to Executive Order 13045 ‘‘Protection of Children from Environmental Health Risks and Safety Risks’’ (62 FR 19885, April 23, 1997), because it approves a State rule implementing a Federal standard. In reviewing SIP submissions, EPA’s role is to approve State choices, provided that they meet the criteria of the CAA. In this context, in the absence of a prior existing requirement for the State to use voluntary consensus standards (VCS), EPA has no authority to disapprove a SIP submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews a SIP submission, to use VCS in place of a SIP submission that otherwise satisfies the provisions of the CAA. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). 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 rule 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 November 30, 2007. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule 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, Intergovernmental relations, Nitrogen oxides, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds. Dated: September 21, 2007. J.I. Palmer, Jr., Regional Administrator, Region 4. I 40 CFR part 52 is amended as follows: PART 52—[AMENDED] 1. The authority citation for part 52 continues to read as follows: I Authority: 42.U.S.C. 7401 et seq. Subpart B—Alabama 2. Section 52.50(c) is amended by: a. Under Chapter 335–3–5 add in numerical order new entries for ‘‘335– 3–5–.06,’’ ‘‘335–3–5–.07,’’ ‘‘335–3–5– .08,’’ ‘‘335–3–5–.11,’’ ‘‘335–3–5–.12,’’ ‘‘335–3–5–.13,’’ and ‘‘335–3–5–.14,’’ I b. Under Chapter 335–3–8 revise entries for ‘‘335–3–8–.05,’’ and ‘‘335–3– 8–.10,’’ I c. Under Chapter 335–3–8 add in numerical order new entries for ‘‘335– 3–8–.16,’’ ‘‘335–3–8–.17,’’ 335–3–8– .18,’’ 335–3–8–.20,’’ 335–3–8–.21,’’ ‘‘335–3–8–.23,’’ ‘‘335–3–8–.24,’’ ‘‘335– 8–.25,’’ 335–3–8–.26,’’ ‘‘335–3–8–.27,’’ ‘‘335–3–8–.29,’’ ‘‘335–3–8–.30,’’ ‘‘335– 3–8–.32,’’ and ‘‘335–3–8–.33.’’ I I § 52.50 * Identification of plan. * * (c) * * * * * EPA-APPROVED ALABAMA REGULATIONS State citation State effective date Title/subject EPA approval date Explanation Chapter 335–3–5—Control of Sulfur Compound Emissions * * 335–3–5–.06 ................................ jlentini on PROD1PC65 with RULES 335–3–5–.07 ................................ 335–3–5–.08 ................................ 335–3–5–.11 ................................ VerDate Aug<31>2005 18:24 Sep 28, 2007 * * State Clean Air Interstate Rule (CAIR) SO2 Trading Program Provisions. CAIR Designated Representative for CAIR SO2 Sources. Permits ......................................... CAIR SO2 Allowance Tracking System. Jkt 214001 PO 00000 Frm 00009 Fmt 4700 04/03/07 04/03/07 04/03/07 04/03/07 Sfmt 4700 * * 10/01/07 [Insert citation of publication]. 10/01/07 [Insert citation of publication]. 10/01/07 [Insert citation of publication]. 10/01/07 [Insert citation of publication]. E:\FR\FM\01OCR1.SGM 01OCR1 * 55664 Federal Register / Vol. 72, No. 189 / Monday, October 1, 2007 / Rules and Regulations EPA-APPROVED ALABAMA REGULATIONS—Continued State effective date State citation Title/subject 335–3–5–.12 ................................ CAIR SO2 Allowance Transfers .. 04/03/07 335–3–5–.13 ................................ Monitoring and Reporting ............ 04/03/07 335–3–5–.14 ................................ CAIR SO2 Opt-In Units ................ 04/03/07 * * * * EPA approval date Explanation 10/01/07 [Insert citation of publication]. 10/01/07 [Insert citation of publication]. 10/01/07 [Insert citation of publication]. * * * Chapter 335–3–8—Control of Nitrogen Oxide Emissions * * 335–3–8–.05 ................................ * * NOX Budget Trading Program .... * * 10/01/07 [Insert citation of publication]. * 04/03/07 * * 335–3–8–.10 ................................ * * NOX Allowance Tracking System * * 10/01/07 [Insert citation of publication]. * 04/03/07 * * 335–3–8–.16 ................................ 335–3–8–.20 ................................ CAIR NOX Allowance Allocations 04/03/07 335–3–8–.21 ................................ 04/03/07 335–3–8–.23 ................................ CAIR NOX Allowance Tracking System. CAIR Monitoring and Reporting .. 335–3–8–.24 ................................ CAIR NOX Opt-In Units ............... 04/03/07 335–3–8–.25 ................................ CAIR NOX Ozone Season Trading Program. CAIR Designated Representative for CAIR NOX Ozone Season Sources. CAIR NOX Ozone Season Permits. CAIR NOX Ozone Season Allowance Allocations. CAIR NOX Ozone Season Allowance Tracking System. CAIR NOX Ozone Season Monitoring and Reporting. CAIR NOX Ozone Season Opt-In Units. 04/03/07 * 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. * 335–3–8–.18 ................................ * * CAIR NOX Annual Budget Trading Program. CAIR Designated Representative for CAIR NOX Sources. CAIR Permits ............................... 335–3–8–.17 ................................ 335–3–8–.26 ................................ 335–3–8–.27 ................................ 335–3–8–.29 ................................ 335–3–8–.30 ................................ 335–3–8–.32 ................................ 335–3–8–.33 ................................ * * * * * * * * [FR Doc. E7–19352 Filed 9–28–07; 8:45 am] BILLING CODE 6560–50–P 04/03/07 04/03/07 04/03/07 04/03/07 04/03/07 04/03/07 04/03/07 04/03/07 04/03/07 04/03/07 * 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. 10/01/07 [Insert publication]. * ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 jlentini on PROD1PC65 with RULES [EPA–R05–OAR–2006–0540; FRL–8472–4] Approval and Promulgation of Air Quality Implementation Plans; Indiana; Oxides of Nitrogen Regulations, Phase II Environmental Protection Agency (EPA). ACTION: Final rule. AGENCY: VerDate Aug<31>2005 17:12 Sep 28, 2007 Jkt 214001 PO 00000 Frm 00010 Fmt 4700 Sfmt 4700 * citation of citation of citation of citation of citation of citation of citation of citation of citation of citation of citation of citation of citation of citation of * * SUMMARY: The EPA is approving Indiana’s oxides of nitrogen (NOX) rules which satisfy the requirements of EPA’s NOX SIP Call Phase II Rule (the Phase II Rule). EPA is approving these regulations based on Indiana’s demonstration that they will result in the achievement of the Phase II budget through source compliance with rules affecting stationary internal combustion (IC) engines which are identified in the NOX plan submittal. Limiting NOX emissions from IC engines will enable the State to meet the Phase II incremental difference of 4,244 tons E:\FR\FM\01OCR1.SGM 01OCR1

Agencies

ENVIRONMENTAL PROTECTION AGENCY

[Federal Register Volume 72, Number 189 (Monday, October 1, 2007)]
[Rules and Regulations]
[Pages 55659-55664]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-19352]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2007-0359-200736; FRL-8475-9]

Approval and Promulgation of Implementation Plans; Alabama; Clean
Air Interstate Rule

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: EPA is taking final action to approve a revision to the
Alabama State Implementation Plan (SIP) submitted on March 7, 2007. The
Alabama Department of Environmental Management (ADEM) also previously
submitted a final submittal dated June 16, 2006, which was subsequently
updated in a prehearing request for parallel processing on November 16,
2006, to comply with EPA's revisions to the model rule. Alabama's final
March 7, 2007, submittal replaces the State's June 16, 2006, and
November 16, 2006, submittals. This revision addresses the requirements
of EPA's Clean Air Interstate Rule (CAIR) promulgated on May 12, 2005,
and subsequently revised on April 28, 2006, and December 13, 2006. EPA
has determined that the SIP revision fully implements the CAIR
requirements for Alabama. As a result of this action, EPA will also
withdraw, through a separate rulemaking, the CAIR Federal
Implementation Plans (FIPs) concerning sulfur dioxide (SO2),
nitrogen oxides (NOX) annual, and NOX ozone
season emissions for Alabama. The CAIR FIPs for all States in the CAIR
region were promulgated on April 28, 2006, and subsequently revised on
December 13, 2006.
CAIR requires States to reduce emissions of SO2 and
NOX that significantly contribute to, and interfere with
maintenance of, the National Ambient Air Quality Standards (NAAQS) for
fine particulates (PM2.5) and/or ozone in any downwind
state. CAIR establishes State budgets for SO2 and
NOX and requires States to submit SIP revisions that
implement these budgets in States that EPA concluded did contribute to
nonattainment in downwind states. States have the flexibility to choose
which control measures to adopt to achieve the budgets, including
participating in the EPA-administered cap-and-trade programs. In the
SIP revision that EPA is approving, Alabama has met the CAIR
requirements by electing to participate in the EPA-administered cap-
and-trade programs addressing SO2, NOX annual,
and NOX ozone season emissions.

DATES: This rule is effective on October 31, 2007.

ADDRESSES: EPA has established a docket for this action under Docket ID
No. EPA-R04-OAR-2007-0359. 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 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
Regulatory Development Section,

[[Page 55660]]

Air Planning Branch, Air, Pesticides and Toxics Management Division,
U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street, SW.,
Atlanta, Georgia 30303-8960. EPA requests that if at all possible, you
contact the person listed in the FOR FURTHER INFORMATION CONTACT
section to schedule your inspection. The Regional Office's official
hours of business are Monday through Friday, 8:30 to 4:30 excluding
federal holidays.

FOR FURTHER INFORMATION CONTACT: Stacy Harder, Regulatory Development
Section, Air Planning Branch, Air, Pesticides and Toxics Management
Division, Region 4, U.S. Environmental Protection Agency, 61 Forsyth
Street, SW., Atlanta, Georgia 30303-8960. The telephone number is (404)
562-9042. Ms. Harder can also be reached via electronic mail at
harder.stacy@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document whenever ``we,''
``us,'' or ``our'' is used, we mean EPA.

Table of Contents

I. What Action Is EPA Taking?
II. What Is the Regulatory History of CAIR and the CAIR FIPs?
III. What Are the General Requirements of CAIR and the CAIR FIPs?
IV. Analysis of Alabama's CAIR SIP Submittal
A. State Budgets for Allowance Allocations
B. CAIR Cap-and-Trade Programs
C. NOX Allowance Allocations
D. Allocation of NOX Allowances From the Compliance
Supplement Pool
E. Individual Opt-in Units
V. Final Action
VI. Statutory and Executive Order Reviews

I. What Action Is EPA Taking?

EPA is taking final action to approve a revision to Alabama's SIP
submitted on March 7, 2007. In its SIP revision, Alabama has met the
CAIR requirements by requiring certain electric generating units (EGUs)
to participate in the EPA-administered State CAIR cap-and-trade
programs addressing SO2, NOX annual, and
NOX ozone season emissions. Alabama's regulations adopt by
reference most of the provisions of EPA's SO2,
NOX annual, and NOX ozone season model trading
rules, with certain changes discussed below. EPA has determined that
the SIP as revised will meet the applicable requirements of CAIR. As a
result of this action, the Administrator of EPA will also issue a final
rule to withdraw the FIPs concerning SO2, NOX
annual, and NOX ozone season emissions for Alabama. The
Administrator's action will delete and reserve 40 CFR 52.54 and 40 CFR
52.55, relating to the CAIR FIP obligations for Alabama. The withdrawal
of the CAIR FIPs for Alabama is a conforming amendment that must be
made once the SIP is approved because EPA's authority to issue the FIPs
was premised on a deficiency in the SIP for Alabama. Once a SIP is
fully approved, EPA no longer has authority for the FIPs. Thus, EPA
does not have the option of maintaining the FIPs following full SIP
approval. Accordingly, EPA does not intend to offer an opportunity for
a public hearing or an additional opportunity for written public
comment on the withdrawal of the FIPs.
EPA proposed to approve Alabama's request to amend the SIP on July
12, 2007 (72 FR 38045). In that proposal, EPA also stated its intent to
withdraw the FIP, as described above. The comment period closed on
August 13, 2007. No comments were received. EPA is finalizing the
approval as proposed based on the rationale stated in the proposal and
in this final action.

II. What is the Regulatory History of CAIR and the CAIR FIPs?

The CAIR was published by EPA on May 12, 2005 (70 FR 25162). In
this rule, EPA determined that 28 States and the District of Columbia
contribute significantly to nonattainment and interfere with
maintenance of the NAAQS for PM2.5 and/or 8-hour ozone in
downwind States in the eastern part of the country. As a result, EPA
required those upwind States to revise their SIPs to include control
measures that reduce emissions of SO2, which is a precursor
to PM2.5 formation, and/or NOX, which is a
precursor to both ozone and PM2.5 formation. For
jurisdictions that contribute significantly to downwind
PM2.5 nonattainment, CAIR sets annual State-wide emission
reduction requirements (i.e., budgets) for SO2 and annual
State-wide emission reduction requirements for NOX.
Similarly, for jurisdictions that contribute significantly to 8-hour
ozone nonattainment, CAIR sets State-wide emission reduction
requirements for NOX for the ozone season (May 1 to
September 30). Under CAIR, States may implement these reduction
requirements by participating in the EPA-administered cap-and-trade
programs or by adopting any other control measures.
CAIR explains to subject States what must be included in SIPs to
address the requirements of section 110(a)(2)(D) of the Clean Air Act
(CAA) with regard to interstate transport with respect to the 8-hour
ozone and PM2.5 NAAQS. EPA made national findings, effective
on May 25, 2005, that the States had failed to submit SIPs meeting the
requirements of section 110(a)(2)(D). The SIPs were due in July 2000,
three years after the promulgation of the 8-hour ozone and
PM2.5 NAAQS.

III. What Are the General Requirements of CAIR and the CAIR FIPs?

CAIR establishes State-wide emission budgets for SO2 and
NOX and is to be implemented in two phases. The first phase
of NOX reductions starts in 2009 and continues through 2014,
while the first phase of SO2 reductions starts in 2010 and
continues through 2014. The second phase of reductions for both
NOX and SO2 starts in 2015 and continues
thereafter. CAIR requires States to implement the budgets by either:
(1) Requiring EGUs to participate in the EPA-administered cap-and-trade
programs; or (2) adopting other control measures of the State's
choosing and demonstrating that such control measures will result in
compliance with the applicable State SO2 and NOX
budgets.
The May 12, 2005, and April 28, 2006, CAIR rules provide model
rules that States must adopt (with certain limited changes, if desired)
if they want to participate in the EPA-administered trading programs.
With two exceptions, only States that choose to meet the
requirements of CAIR through methods that exclusively regulate EGUs are
allowed to participate in the EPA-administered trading programs. One
exception is for States that adopt the opt-in provisions of the model
rules to allow non-EGUs individually to opt into the EPA-administered
trading programs. The other exception is for States that include all
non-EGUs from their NOX SIP Call trading programs in their
CAIR NOX ozone season trading programs.

IV. Analysis of Alabama's CAIR SIP Submittal

A. State Budgets for Allowance Allocations

In this action, EPA is taking final action to approve Alabama's SIP
revision that adopts the following budgets for the State, i.e., 69,020
(2009-2014) and 57,517 (2015-thereafter) tons for NOX annual
emissions, 34,510 (2009-2014) and 29,146 (2015-thereafter) tons for
NOX ozone season emissions, and 157,582 (2010-2014) and
110,307 (2015-thereafter) tons for SO2 emissions. The
NOX ozone season budget properly reflects the inclusion of
NOX SIP Call trading program units in the CAIR
NOX ozone season trading program, as discussed below.
Alabama's SIP revision sets these budgets as the total amounts of
allowances available

[[Page 55661]]

for allocation for each year under the EPA-administered cap-and-trade
programs.

B. CAIR Cap-and-Trade Programs

The CAIR NOX annual and ozone season model trading rules
both largely mirror the structure of the NOX SIP Call model
trading rule in 40 CFR part 96, subparts A through I. While the
provisions of the NOX annual and ozone season model rules
are similar, there are some differences. For example, the
NOX annual model rule (but not the NOX ozone
season model rule) provides for a compliance supplement pool (CSP),
which is discussed below and under which allowances may be awarded for
early reductions of NOX annual emissions. As a further
example, the NOX ozone season model rule reflects the fact
that the CAIR NOX ozone season trading program replaces the
NOX SIP Call trading program after the 2008 ozone season and
is coordinated with the NOX SIP Call program. The
NOX ozone season model rule provides incentives for early
emissions reductions by allowing banked, pre-2009 NOX SIP
Call allowances to be used for compliance in the CAIR NOX
ozone season trading program. In addition, States have the option of
continuing to meet their NOX SIP Call requirement by
participating in the CAIR NOX ozone season trading program
and including all their NOX SIP Call trading sources in that
program.
The provisions of the CAIR SO2 model rule are also
similar to the provisions of the NOX annual and ozone season
model rules. However, the SO2 model rule is coordinated with
the ongoing Acid Rain SO2 cap-and-trade program under CAA
title IV. The SO2 model rule uses the title IV allowances
for compliance, with each allowance allocated for 2010-2014 authorizing
only 0.50 ton of emissions and each allowance allocated for 2015 and
thereafter authorizing only 0.35 ton of emissions. Banked title IV
allowances allocated for years before 2010 can be used at any time in
the CAIR SO2 cap-and-trade program, with each such allowance
authorizing one ton of emissions. Title IV allowances are to be freely
transferable among sources covered by the Acid Rain Program and sources
covered by the CAIR SO2 cap-and-trade program.
EPA also used the CAIR model trading rules as the basis for the
trading programs in the CAIR FIPs. The CAIR FIP trading rules are
virtually identical to the CAIR model trading rules, with changes made
to account for Federal rather than State implementation. The CAIR model
SO2, NOX annual, and NOX ozone season
trading rules and the respective CAIR FIP trading rules are designed to
work together as integrated SO2, NOX annual, and
NOX ozone season trading programs.
In the SIP revision, Alabama has chosen to implement its CAIR
budgets by requiring EGUs to participate in EPA-administered cap-and-
trade programs for SO2, NOX annual, and
NOX ozone season emissions. Alabama has adopted a full SIP
revision (with the revisions discussed above) that adopts, with certain
allowed changes discussed below, the CAIR model cap-and-trade rules for
SO2, NOX annual, and NOX ozone season
emissions.

C. Applicability Provisions for Non-EGU NOX SIP Call Sources

In general, the CAIR model trading rules apply to any stationary,
fossil-fuel-fired boiler or stationary, fossil-fuel-fired combustion
turbine serving at any time, since the later of November 15, 1990 or
the start-up of the unit's combustion chamber, a generator with
nameplate capacity of more than 25 MWe producing electricity for sale.
States have the option of bringing in, for the CAIR NOX
ozone season program only, those units in the State's NOX
SIP Call trading program that are not EGUs as defined under CAIR.
States exercising this option need to add the applicability provisions
in the State's NOX SIP Call trading rule for non-EGUs to the
applicability provisions in 40 CFR 96.304 in order to include in the
CAIR NOX ozone season trading program all units required to
be in the State's NOX SIP Call trading program that are not
already included under 40 CFR 96.304. Under this option, the CAIR
NOX ozone season program must cover all large industrial
boilers and combustion turbines, as well as any small EGUs (i.e. units
serving a generator with a nameplate capacity of 25 MWe or less) that
the State currently requires to be in the NOX SIP Call
trading program.
Alabama has chosen to expand the applicability provisions of the
CAIR NOX ozone season trading program to include all non-
EGUs in the State's NOX SIP Call trading program.

D. NOX Allowance Allocations

Under the NOX allowance allocation methodology in the
CAIR model trading rules and in the CAIR FIP, NOX annual and
ozone season allowances are allocated to units that have operated for
five years, based on heat input data from a three-year period that are
adjusted for fuel type by using fuel factors of 1.0 for coal, 0.6 for
oil, and 0.4 for other fuels. The CAIR model trading rules and the CAIR
FIP also provide a new unit set-aside from which units without five
years of operation are allocated allowances based on the units' prior
year emissions.
States may establish in their SIP submissions a different
NOX allowance allocation methodology that will be used to
allocate allowances to sources in the States if certain requirements
are met concerning the timing of submission of units' allocations to
the Administrator for recordation and the total amount of allowances
allocated for each control period. In adopting alternative
NOX allowance allocation methodologies, States have
flexibility with regard to: (1) The cost to recipients of the
allowances, which may be distributed for free or auctioned; (2) the
frequency of allocations; (3) the basis for allocating allowances,
which may be distributed, for example, based on historical heat input
or electric and thermal output; and (4) the use of allowance set-asides
and, if used, their size.
Alabama has chosen to replace the provisions of the CAIR
NOX annual and CAIR NOX ozone season model
trading rules concerning the allocation of allowances with its own
methodology. Alabama has chosen to distribute NOX annual
allowances based upon allocation methods for existing, replacement, and
new units. As explained in the proposed approval, EPA understands that
the language is intended to mean that allocations will be determined by
the dates and only for the years identified or described in 40 CFR
96.141 and 40 CFR 96.341. EPA did not receive any comments on this
issue, and concludes that this understanding is a correct
interpretation of Alabama's rules. Additionally, Alabama's CAIR
NOX Annual and CAIR NOX ozone season rules
establish permanent allocations for specified units designated as
``existing units'' or ``new units'' and do not include provisions of
the EPA's model rules that call for adjusting the allocations for
existing units to provide allocations for future, new units.
Finally, Alabama's CAIR NOX ozone season rule includes
special provisions concerning the allocation of allowances for the 2009
control period. As discussed above, Alabama's rule expanded the
applicability provisions of the model rule to include--as CAIR
NOX ozone season units--those units in Alabama's
NOX SIP Call program (i.e., Alabama's NOX Budget
Trading Program) that are not covered by model rule applicability
provisions. Alabama already issued NOX allowances to some of
those units for 2009 under the NOX Budget Trading Program.
Alabama's rule

[[Page 55662]]

(in Rule 335-3.8-.29(3)(d)1.(i)) states that, if a unit was allocated
more allowances under the NOX Budget Trading Program for
2009 than it would otherwise be allocated under Alabama's allocation
provisions generally applicable to CAIR NOX ozone season
units, then the Department ``will allocate the same number of CAIR
Ozone Season allowances'' to that unit. The allocations to other units
under the generally applicable allocation provisions will be reduced
for 2009 in order to take account of this adjustment of the
NOX Budget Trading Program unit's 2009 allocation. Further,
Alabama's rule (in Rule 335-3.8-.29(2)(a)1.) states that, for the 2009
control period, the Department will submit to the Administrator, for
the purpose of recording allocations, ``only the difference between the
CAIR NOX Ozone Season allowance allocations and the 2009
NOX Budget Trading Program allowance allocations.'' In
short, Alabama's rule treats each unit's 2009 NOX Budget
Trading Program allocation as a 2009 CAIR NOX ozone season
allocation for that unit that has been previously recorded by the
Administrator. EPA therefore interprets Alabama's rule to provide that
each 2009 NOX Budget Trading Program allowance is a 2009
CAIR NOX ozone season allowance, whether the NOX
Budget Trading Program allowance is still held by the owners and
operators of the unit or has been transferred to other parties.
Consistent with this interpretation of Alabama's rule, the
Administrator--in operating the CAIR NOX Ozone Season
Tracking System--will treat each such allowance as usable for
compliance with the allowance-holding requirements of the CAIR
NOX Ozone Season Trading Program by any CAIR NOX
ozone season source that holds the allowances in the source's
compliance account as of the allowance transfer deadline, regardless of
the State in which the source is located.
EPA is taking final action to approve the above-described
variations in Alabama's rule from the model rule provisions because the
changes are consistent with the flexibility that CAIR provides States
with regard to allocation methodologies.

E. Allocation of NOX Allowances From the Compliance Supplement Pool

The CAIR establishes a compliance supplement pool to provide an
incentive for early reductions in NOX annual emissions. The
CSP consists of 200,000 CAIR NOX annual allowances of
vintage 2009 for the entire CAIR region, and a State's share of the CSP
is based upon the projected magnitude of the emission reductions
required by CAIR in that State. States may distribute CSP allowances,
one allowance for each ton of early reduction, to sources that make
NOX reductions during 2007 or 2008 beyond what is required
by any applicable State or Federal emission limitation. States also may
distribute CSP allowances based upon a demonstration of need for an
extension of the 2009 deadline for implementing emission controls.
The CAIR annual NOX model trading rule establishes
specific methodologies for allocations of CSP allowances. States may
choose an allowed, alternative CSP allocation methodology to be used to
allocate CSP allowances to sources in the States.
Alabama has chosen to modify the provisions from the CAIR
NOX annual model trading rule concerning the allocation of
allowances from the CSP. Alabama has chosen to distribute CSP
allowances using an allocation methodology that allows the Department
to allocate up to 10,166 additional CAIR NOX allowances for
the control period in 2009. CAIR NOX units that achieve
emissions reductions in 2007 and 2008, that are not necessary to comply
with applicable emissions limitations during those years, may request
early reduction credits. The units requesting CSP allocations must
submit a request by May 1, 2009, to ADEM. Sources are eligible to
receive CSP allowances only to the extent that that the total number of
allowances issued does not exceed 15 percent of the total number of
NOX allowances issued to that unit from the initial
allowance allocation. Any remaining CSP allowances after the initial
distribution will be allocated to eligible units on a pro rata basis,
provided that no unit is issued more allowances than the early
reduction credits requested by that unit in accordance with ADEM's CSP
provisions.

F. Individual Opt-In Units

The opt-in provisions of the CAIR SIP model trading rules allow
certain non-EGUs (i.e., boilers, combustion turbines, and other
stationary fossil-fuel-fired devices) that do not meet the
applicability criteria for a CAIR trading program to participate
voluntarily in (i.e., opt into) the CAIR trading program. A non-EGU may
opt into one or more of the CAIR trading programs. In order to qualify
to opt into a CAIR trading program, a unit must vent all emissions
through a stack and be able to meet monitoring, recordkeeping, and
recording requirements of 40 CFR part 75. The owners and operators
seeking to opt a unit into a CAIR trading program must apply for a CAIR
opt-in permit. If the unit is issued a CAIR opt-in permit, the unit
becomes a CAIR unit, is allocated allowances, and must meet the same
allowance-holding and emissions monitoring and reporting requirements
as other units subject to the CAIR trading program. The opt-in
provisions provide for two methodologies for allocating allowances for
opt-in units, one methodology that applies to opt-in units in general
and a second methodology that allocates allowances only to opt-in units
that the owners and operators intend to repower before January 1, 2015.
States have several options concerning the opt-in provisions.
States may adopt the CAIR opt-in provisions entirely or may adopt them
but exclude one of the methodologies for allocating allowances. States
may also decline to adopt the opt-in provisions at all.
Alabama has chosen to allow non-EGUs meeting certain requirements
to opt into the CAIR trading programs by adopting by reference the
entirety of EPA's model rule provisions for opt-in units in the CAIR
SO2, CAIR NOX annual, and CAIR NOX
ozone season trading programs.

V. Final Action

EPA is taking final action to approve Alabama's full CAIR SIP
revision submitted on March 7, 2007. Under this SIP revision, Alabama
is choosing to participate in the EPA-administered cap-and-trade
programs for SO2, NOX annual, and NOX
ozone season emissions. EPA has determined that the SIP revision meets
the applicable requirements in 40 CFR 51.123(o) and (aa), with regard
to NOX annual and NOX ozone season emissions, and
40 CFR 51.124(o), with regard to SO2 emissions. EPA has
determined that the SIP as revised will meet the requirements of CAIR.
The Administrator of EPA will also issue, without providing an
opportunity for a public hearing or an additional opportunity for
written public comment, a final rule to withdraw the CAIR FIPs
concerning SO2, NOX annual, and NOX
ozone season emissions for Alabama. The Administrator's action will
delete and reserve 40 CFR 52.54 and 40 CFR 52.55. EPA will take final
action to withdraw the CAIR FIPs for Alabama in a separate rulemaking.

VI. Statutory and Executive Order Reviews

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this
action is not a ``significant regulatory action'' and therefore is not
subject to review by the Office of Management and Budget. For

[[Page 55663]]

this reason, this action is also not subject to Executive Order 13211,
``Actions Concerning Regulations That Significantly Affect Energy
Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001). This action
merely approves State law as meeting Federal requirements and would
impose no additional requirements beyond those imposed by State law.
Accordingly, the Administrator certifies that this rule will not have a
significant economic impact on a substantial number of small entities
under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). Because
this action approves pre-existing requirements under State law and does
not impose any additional enforceable duty beyond that required by
State law, it 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).
This rule also does not have tribal implications because it will
not have a substantial direct effect on one or more Indian tribes, 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, as specified by Executive Order 13175 (65
FR 67249, November 9, 2000). This action also does not have Federalism
implications because it does 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 (64
FR 43255, August 10, 1999). This action 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 CAA.
This rule also is not subject to Executive Order 13045 ``Protection of
Children from Environmental Health Risks and Safety Risks'' (62 FR
19885, April 23, 1997), because it approves a State rule implementing a
Federal standard.
In reviewing SIP submissions, EPA's role is to approve State
choices, provided that they meet the criteria of the CAA. In this
context, in the absence of a prior existing requirement for the State
to use voluntary consensus standards (VCS), EPA has no authority to
disapprove a SIP submission for failure to use VCS. It would thus be
inconsistent with applicable law for EPA, when it reviews a SIP
submission, to use VCS in place of a SIP submission that otherwise
satisfies the provisions of the CAA. Thus, the requirements of section
12(d) of the National Technology Transfer and Advancement Act of 1995
(15 U.S.C. 272 note) do not apply. This rule does not impose an
information collection burden under the provisions of the Paperwork
Reduction Act of 1995 (44 U.S.C. 3501 et seq.).
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 rule 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 November 30, 2007. Filing a petition for
reconsideration by the Administrator of this final rule does not affect
the finality of this rule 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, Intergovernmental
relations, Nitrogen oxides, Ozone, Particulate matter, Reporting and
recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

Dated: September 21, 2007.
J.I. Palmer, Jr.,
Regional Administrator, Region 4.

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 B--Alabama

0
2. Section 52.50(c) is amended by:
0
a. Under Chapter 335-3-5 add in numerical order new entries for ``335-
3-5-.06,'' ``335-3-5-.07,'' ``335-3-5-.08,'' ``335-3-5-.11,'' ``335-3-
5-.12,'' ``335-3-5-.13,'' and ``335-3-5-.14,''
0
b. Under Chapter 335-3-8 revise entries for ``335-3-8-.05,'' and ``335-
3-8-.10,''
0
c. Under Chapter 335-3-8 add in numerical order new entries for ``335-
3-8-.16,'' ``335-3-8-.17,'' 335-3-8-.18,'' 335-3-8-.20,'' 335-3-
8-.21,'' ``335-3-8-.23,'' ``335-3-8-.24,'' ``335-8-.25,'' 335-3-
8-.26,'' ``335-3-8-.27,'' ``335-3-8-.29,'' ``335-3-8-.30,'' ``335-3-
8-.32,'' and ``335-3-8-.33.''

Sec. 52.50 Identification of plan.

* * * * *
(c) * * *

EPA-Approved Alabama Regulations
--------------------------------------------------------------------------------------------------------------------------------------------------------
State
State citation Title/subject effective date EPA approval date Explanation
--------------------------------------------------------------------------------------------------------------------------------------------------------
Chapter 335-3-5--Control of Sulfur Compound Emissions
--------------------------------------------------------------------------------------------------------------------------------------------------------
* * * * * * *
335-3-5-.06....................... State Clean Air 04/03/07 10/01/07 [Insert citation of .....................................
Interstate Rule publication].
(CAIR) SO2 Trading
Program Provisions.
335-3-5-.07....................... CAIR Designated 04/03/07 10/01/07 [Insert citation of .....................................
Representative for publication].
CAIR SO2 Sources.
335-3-5-.08....................... Permits.............. 04/03/07 10/01/07 [Insert citation of .....................................
publication].
335-3-5-.11....................... CAIR SO2 Allowance 04/03/07 10/01/07 [Insert citation of .....................................
Tracking System. publication].

[[Page 55664]]

335-3-5-.12....................... CAIR SO2 Allowance 04/03/07 10/01/07 [Insert citation of .....................................
Transfers. publication].
335-3-5-.13....................... Monitoring and 04/03/07 10/01/07 [Insert citation of .....................................
Reporting. publication].
335-3-5-.14....................... CAIR SO2 Opt-In Units 04/03/07 10/01/07 [Insert citation of .....................................
publication].

* * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
Chapter 335-3-8--Control of Nitrogen Oxide Emissions
--------------------------------------------------------------------------------------------------------------------------------------------------------
* * * * * * *
335-3-8-.05....................... NOX Budget Trading 04/03/07 10/01/07 [Insert citation of .....................................
Program. publication].

* * * * * * *
335-3-8-.10....................... NOX Allowance 04/03/07 10/01/07 [Insert citation of .....................................
Tracking System. publication].

* * * * * * *
335-3-8-.16....................... CAIR NOX Annual 04/03/07 10/01/07 [Insert citation of .....................................
Budget Trading publication].
Program.
335-3-8-.17....................... CAIR Designated 04/03/07 10/01/07 [Insert citation of .....................................
Representative for publication].
CAIR NOX Sources.
335-3-8-.18....................... CAIR Permits......... 04/03/07 10/01/07 [Insert citation of .....................................
publication].
335-3-8-.20....................... CAIR NOX Allowance 04/03/07 10/01/07 [Insert citation of .....................................
Allocations. publication].
335-3-8-.21....................... CAIR NOX Allowance 04/03/07 10/01/07 [Insert citation of .....................................
Tracking System. publication].
335-3-8-.23....................... CAIR Monitoring and 04/03/07 10/01/07 [Insert citation of .....................................
Reporting. publication].
335-3-8-.24....................... CAIR NOX Opt-In Units 04/03/07 10/01/07 [Insert citation of .....................................
publication].
335-3-8-.25....................... CAIR NOX Ozone Season 04/03/07 10/01/07 [Insert citation of .....................................
Trading Program. publication].
335-3-8-.26....................... CAIR Designated 04/03/07 10/01/07 [Insert citation of
Representative for publication].
CAIR NOX Ozone
Season Sources.
335-3-8-.27....................... CAIR NOX Ozone Season 04/03/07 10/01/07 [Insert citation of .....................................
Permits. publication].
335-3-8-.29....................... CAIR NOX Ozone Season 04/03/07 10/01/07 [Insert citation of .....................................
Allowance publication].
Allocations.
335-3-8-.30....................... CAIR NOX Ozone Season 04/03/07 10/01/07 [Insert citation of .....................................
Allowance Tracking publication].
System.
335-3-8-.32....................... CAIR NOX Ozone Season 04/03/07 10/01/07 [Insert citation of .....................................
Monitoring and publication].
Reporting.
335-3-8-.33....................... CAIR NOX Ozone Season 04/03/07 10/01/07 [Insert citation of .....................................
Opt-In Units. publication].

* * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------

* * * * *
[FR Doc. E7-19352 Filed 9-28-07; 8:45 am]
BILLING CODE 6560-50-P

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