Control of Emissions From New Marine Compression-Ignition Engines at or Above 30 Liters per Cylinder, 22896-23065 [2010-2534]

Agencies

• ENVIRONMENTAL PROTECTION AGENCY

[Federal Register Volume 75, Number 83 (Friday, April 30, 2010)]
[Rules and Regulations]
[Pages 22896-23065]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-2534]



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Part II





Environmental Protection Agency





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40 CFR Parts 80, 85, 86, et al.



Control of Emissions From New Marine Compression-Ignition Engines at or 
Above 30 Liters per Cylinder; Final Rule

Federal Register / Vol. 75, No. 83 / Friday, April 30, 2010 / Rules 
and Regulations

[[Page 22896]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 80, 85, 86, 94, 1027, 1033, 1039, 1042, 1043, 1045, 
1048, 1051, 1054, 1060, 1065, and 1068

[EPA-HQ-OAR-2007-0121; FRL-9097-4]
RIN 2060-AO38


Control of Emissions From New Marine Compression-Ignition Engines 
at or Above 30 Liters per Cylinder

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is finalizing emission standards for new marine diesel 
engines with per-cylinder displacement at or above 30 liters (called 
Category 3 marine diesel engines) installed on U.S. vessels. These 
emission standards are equivalent to those adopted in the amendments to 
Annex VI to the International Convention for the Prevention of 
Pollution from Ships (MARPOL Annex VI). The emission standards apply in 
two stages--near-term standards for newly built engines will apply 
beginning in 2011; long-term standards requiring an 80 percent 
reduction in NOX emissions will begin in 2016. We are also 
finalizing a change to our diesel fuel program that will allow for the 
production and sale of 1,000 ppm sulfur fuel for use in Category 3 
marine vessels. In addition, the new fuel requirements will generally 
forbid the production and sale of other fuels above 1,000 ppm sulfur 
for use in most U.S. waters, unless alternative devices, procedures, or 
compliance methods are used to achieve equivalent emissions reductions. 
We are adopting further provisions under the Act to Prevent Pollution 
from Ships, especially to apply the emission standards to engines 
covered by MARPOL Annex VI that are not covered by the Clean Air Act, 
and to require that these additional engines use the specified fuels 
(or equivalents).
    The final regulations also include technical amendments to our 
motor vehicle and nonroad engine regulations; many of these changes 
involve minor adjustments or corrections to our recently finalized rule 
for new nonroad spark-ignition engines, or adjustment to other 
regulatory provisions to align with this recent final rule.

DATES: This final rule is effective on June 29, 2010. The incorporation 
by reference of certain publications listed in this regulation is 
approved by the Director of the Federal Register as of June 29, 2010.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. EPA-HQ-OAR-2007-0121. All documents in the docket are listed on the 
https://www.regulations.gov Web site. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, is not placed on the Internet and will be 
publicly available only in hard copy form. Publicly available docket 
materials are available either electronically in https://www.regulations.gov or in hard copy at the EPA-HQ-OAR-2007-0121 Docket, 
EPA/DC, EPA West, Room 3334, 1301 Constitution Ave., NW., Washington, 
DC. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday 
through Friday, excluding legal holidays. The telephone number for the 
Public Reading Room is (202) 566-1744, and the telephone number for the 
EPA-HQ-OAR-2007-0121 is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: Amy Kopin, U.S. EPA, Office of 
Transportation and Air Quality, Assessment and Standards Division 
(ASD), Environmental Protection Agency, 2000 Traverwood Drive, Ann 
Arbor, MI 48105; telephone number: (734) 214-4417; fax number: (734) 
214-4050; e-mail address: Kopin.Amy@epa.gov, or Assessment and 
Standards Division Hotline; telephone number: (734) 214-4636.

SUPPLEMENTARY INFORMATION:

General Information

Does This Action Apply to Me?

    This action affects companies that manufacture, sell, or import 
into the United States new marine compression-ignition engines with per 
cylinder displacement at or above 30 liters for use on vessels flagged 
or registered in the United States; companies and persons that make 
vessels that will be flagged or registered in the United States and 
that use such engines; and the owners or operators of such U.S. 
vessels. Additionally, this action may affect companies and persons 
that rebuild or maintain these engines. Finally, this action may also 
affect those that manufacture, import, distribute, sell, and dispense 
fuel for use by Category 3 marine vessels. Affected categories and 
entities include the following:

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                   Category                     NAICS Code \a\      Examples of potentially affected entities
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Industry.....................................            333618  Manufacturers of new marine diesel engines.
Industry.....................................            336611  Manufacturers of marine vessels.
Industry.....................................            811310  Engine repair and maintenance.
Industry.....................................               483  Water transportation, freight and passenger.
Industry.....................................            324110  Petroleum Refineries.
Industry.....................................    424710, 424720  Petroleum Bulk Stations and Terminals;
                                                                  Petroleum and Petroleum Products Wholesalers.
Industry.....................................            483113  Coastal and Great Lakes Freight Transportation
Industry.....................................            483114  Coastal and Great Lakes Passenger
                                                                  Transportation
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Note:
\a\ North American Industry Classification System (NAICS).

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be regulated by this 
action. This table lists the types of entities that EPA is now aware 
will be regulated by this action. Other types of entities not listed in 
the table may also be regulated. To determine whether your company is 
regulated by this action, you should carefully examine the 
applicability criteria in 40 CFR 80.501, 94.1, 1042.1, and 1065.1, and 
the final regulations. If you have questions, consult the person listed 
in the preceding FOR FURTHER INFORMATION CONTACT section.

Table of Contents

I. Overview
    A. What Are the Elements of EPA's Coordinated Strategy for 
Ships?
    B. Why Is EPA Making This Rule?
    C. Statutory Basis for Action
II. Air Quality, Health and Welfare Impacts
    A. Public Health Impacts
    B. Environmental Impacts
    C. Air Quality Modeling Results
    D. Emissions From Ships With Category 3 Engines
III. Engine Standards
    A. What Category 3 Marine Engines Are Covered?

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    B. What Standards Are We Finalizing for Newly Manufactured 
Engines?
    C. Are the Standards Feasible?
IV. Fuel Standards
    A. Background
    B. Diesel Fuel Standards Prior to This Final Rule
    C. Applicability
    D. Fuel Sulfur Standards
    E. Technical Amendments to the Current Diesel Fuel Sulfur 
Program Regulations
V. Emission Control Areas for U.S. Coasts
    A. What Is an ECA?
    B. U.S. Emission Control Area Designation
    C. Technological Approaches To Comply With Fuel Standards
    D. ECA Designation and Foreign-Flagged Vessels
VI. Certification and Compliance Program
    A. Compliance Provisions for Category 3 Engines
    B. Compliance Provisions To Implement Annex VI NOX 
Regulation and the NOX Technical Code
    C. Changes to the Requirements Specific to Engines Below 30 
Liters per Cylinder
    D. Other Regulatory Issues
    E. U.S. Vessels Enrolled in the Maritime Security Program
VII. Costs and Economic Impacts
    A. Estimated Fuel Costs
    B. Estimated Engine Costs
    C. Cost Effectiveness
    D. Economic Impact Analysis
VIII. Benefits
    A. Overview
    B. Quantified Human Health Impacts
    C. Monetized Benefits
    D. What Are the Limitations of the Benefits Analysis?
    E. Comparison of Costs and Benefits
IX. Public Participation
X. Statutory and Executive Order Reviews
    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: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health and Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect 
Energy Supply, Distribution, or Use
    I. National Technology Transfer Advancement Act
    J. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Congressional Review Act
XI. Statutory Provisions and Legal Authority

I. Overview

    This final rule is part of a coordinated strategy to address 
emissions from ocean-going vessels and is an important step in EPA's 
ongoing National Clean Diesel Campaign. In recent years, we have 
adopted major new programs designed to reduce emissions from new diesel 
engines, including those used in highway (66 FR 5001, January 18, 
2001), nonroad (69 FR 38957, June 29, 2004), locomotive, and marine 
applications (73 FR 25098, May 6, 2008). When fully phased in, these 
programs will significantly reduce emissions of harmful pollutants from 
these categories of engines and vehicles. This final rule sets out the 
next step in this ambitious effort by addressing emissions from the 
largest marine diesel engines, called Category 3 marine diesel engines. 
These are engines with per-cylinder displacement at or above 30 liters 
per cylinder, which are used primarily for propulsion power on ocean-
going vessels (OGV).\1\
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    \1\ This final rule generally applies to vessels with the 
largest marine diesel engines, which are called Category 3 engines 
in our regulations. In this preamble, we often refer to vessels 
using these engines as Category 3 vessels. We also refer to them as 
ocean-going vessels although this intended to be only a descriptive 
term. While the large majority of these vessels operate in the 
oceans, some operate solely in our internal waters such as in the 
Great Lakes. Therefore, we do not use the term ocean-going vessels 
to exclude the few vessels with Category 3 engines that operate only 
in fresh-water lakes or rivers or to exclude ocean-going vessels 
with Category 2 or Category 1 engines, but rather to reflect the way 
the vessels being regulated are more commonly known to the general 
public. Note also that, pursuant to 40 CFR 1043 which implements 
APPS, the fuel requirements described in this rule, unless otherwise 
specified, generally apply also to fuel used in gas turbines and 
steam boilers on marine vessels.
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    Emissions from Category 3 engines remain at high levels. These 
engines use emission control technology that is comparable to that used 
by nonroad engines in the early 1990s, and use fuel that can have a 
sulfur content of 30,000 ppm or more. As a result, these engines emit 
high levels of pollutants that contribute to unhealthy air in many 
areas of the U.S. Nationally, in 2009, emissions from Category 3 
engines account for about 10 percent of mobile source emissions of 
nitrogen oxides (NOX), about 24 percent of mobile source 
diesel PM2.5 emissions (with PM2.5 referring to 
particles with a nominal mean aerodynamic diameter less than or equal 
to 2.5 [mu]m), and about 80 percent of mobile source emissions of 
sulfur oxides (SOX). As we look into the future, however, 
emissions from Category 3 engines are expected to become an even more 
dominant inventory source. This will be due to both emission reductions 
from other mobile sources as new emission controls go into effect and 
to the anticipated activity growth for ocean transportation. Without 
new controls, we anticipate the contribution of Category 3 engines to 
national emission inventories to increase to about 24 percent, 34 
percent, and 93 percent of mobile source NOX, 
PM2.5, and SOX emissions, respectively in 2020, 
growing to 40 percent, 48 percent, and 95 percent respectively in 2030. 
The coordinated emission control strategy will lead to significant 
reductions in these emissions and important benefits to public health.
    The evolution of EPA's strategy to control mobile source diesel 
emissions has followed a technology progression, beginning with the 
application of high-efficiency advanced aftertreatment approaches and 
lower sulfur fuel requirements first to highway vehicles, then to 
nonroad engines and equipment, followed by locomotives and smaller 
marine diesel engines. The benefits of this approach include maximizing 
air quality benefits by focusing on the largest populations of sources 
with the shortest service lives, allowing engine manufacturers to 
spread initial research and development costs over a larger population 
of engines, and allowing manufacturers to address the challenges of 
applying advanced emission controls on smaller engines first.
    This approach also allowed us and the shipping community sufficient 
lead time to resolve technical issues with the use of advanced emission 
control technology and lower-sulfur fuel on the largest of these 
engines on vessels engaged in international trade. To that end, EPA has 
been working with engine manufacturers and other industry stakeholders 
for many years to identify and resolve challenges associated with 
applying advanced diesel engine technology to Category 3 engines to 
achieve significant NOX emission reductions and using lower-
sulfur fuels to achieve significant PM and SOX emission 
reductions. This work was fundamental in developing the emission limits 
for Category 3 engines that we are finalizing in this action and 
informed the position advocated by the United States in the 
international negotiations for more stringent tiers of international 
engine emission limits.
    Our coordinated strategy to control emissions from ocean-going 
vessels consists of actions at both the national and international 
levels. It includes: (1) The engine and fuel controls we are finalizing 
in this action under our Clean Air Act authority; (2) the proposal \2\ 
submitted by the U.S. Government to the International Maritime 
Organization (IMO) to amend Annex VI of the

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International Convention for the Prevention of Pollution from Ships 
(MARPOL Annex VI) to designate U.S. coasts as an Emission Control Area 
(ECA) \3\ in which all vessels, regardless of flag, would be required 
to meet the most stringent engine and marine fuel sulfur requirements 
in Annex VI; and (3) the new engine emission and fuel sulfur limits 
contained in the amendments to Annex VI that are applicable to all 
vessels regardless of flag through the Act to Prevent Pollution from 
Ships (APPS), as well as clarification on implementation of those 
standards, application to domestic and foreign-flagged vessels in 
internal waters, and application to nonparty foreign-flagged vessels.
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    \2\ Proposal to Designate an Emission Control Area for Nitrogen 
Oxides, Sulphur Oxides and Particulate Matter, Submitted by the 
United States and Canada. IMO Document MEPC59/6/5, 27 March, 2009. A 
copy of this document can be found at https://www.epa.gov/otaq/regs/nonroad/marine/ci/mepc-59-eca-proposal.pdf.
    \3\ For the purpose of this final rule, the term ``ECA'' refers 
to both the ECA and internal U.S. waters. Refer to Section VI.B. for 
a discussion of the application of the fuel sulfur and engine 
emission limits to U.S. internal waters through APPS.
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    The amendments to APPS to incorporate Annex VI require compliance 
with MARPOL Annex VI by U.S. and foreign vessels that enter U.S. ports 
or operate in U.S. waters. In light of this, we are deciding not to 
revisit our existing approach with respect to foreign vessels in this 
rule. However, the MARPOL Annex VI Tier III NOX and 
stringent fuel sulfur limits are geographically based and would not 
become effective absent designation of U.S. coasts as an ECA. As noted 
above, the United States forwarded a proposal to IMO to amend Annex VI 
to designate U.S. coasts as an ECA. This proposal to amend Annex VI was 
approved in principle and circulated for adoption. We expect the 
proposed ECA amendment will be adopted at MEPC 60, in March 2010. If 
this amendment is not adopted in a timely manner by IMO, we intend to 
take supplemental action to control emissions from vessels that affect 
U.S. air quality.
    Our coordinated strategy for ocean-going vessels will significantly 
reduce emissions from foreign and domestic vessels that affect U.S. air 
quality, and the impacts on human health and welfare will be 
substantial. We project that by 2030 this program will reduce annual 
emissions of NOX, SOX, and particulate matter 
(PM) by 1.2 million, 1.3 million, and 143,000 tons, respectively, and 
the magnitude of these reductions would continue to grow well beyond 
2030.\4\ These reductions are estimated to annually prevent between 
12,000 and 30,000 PM-related premature deaths, between 210 and 920 
ozone-related premature deaths, 1,400,000 work days lost, and 9,600,000 
minor restricted-activity days. The estimated annual monetized health 
benefits of this coordinated strategy in 2030 would be between $110 and 
$270 billion, assuming a 3-percent discount rate (or between $99 and 
$240 billion assuming a 7-percent discount rate). The annual cost of 
the overall program in 2030 would be significantly less, at 
approximately $3.1 billion.
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    \4\ These emission inventory reductions include reductions from 
ships operating within the 24 nautical mile regulatory zone off the 
California Coastline, beginning with the effective date of the 
Coordinated Strategy program elements. The California regulation 
contains a provision that would sunset the requirements of the rule 
if the Federal program achieves equivalent emission reductions. See 
https://www.arb.ca.gov/regact/2008/fuelogv08/fro13.pdf at 13 CCR 
2299.2(j)(1).
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A. What Are the Elements of EPA's Coordinated Strategy for Ships?

    Our coordinated strategy for ocean-going vessels, including the 
emission standards finalized in this action under the Clean Air Act, 
continues EPA's program to progressively apply advanced aftertreatment 
emission control standards to diesel engines and reflects the evolution 
of this technology from the largest inventory source (highway engines), 
to land-based nonroad engines, to locomotives and marine diesel engines 
up to 30 liters per cylinder. The results of these forerunner programs 
are dramatic reductions in NOX and PM2.5 
emissions on the order of 80 to 90 percent, which will lead to 
significant improvements in national air quality.
    The combination of controls in the coordinated strategy for ocean-
going vessels will provide significant reductions in PM2.5, 
NOX, SOX, and toxic compounds, both in the near 
term (as early as 2011) and in the long term. These reductions will be 
achieved in a manner that: (1) Is very cost effective compared to 
additional controls on portside vehicles and equipment and other land-
based mobile sources that are already subject to stringent technology-
forcing emission standards; (2) leverages the international program 
adopted by IMO to ensure that all ships that operate in areas that 
affect U.S. air quality are required to use stringent emission control 
technology; and (3) provides the lead time needed to deal with the 
engineering design workload that is involved in applying advanced high-
efficiency aftertreatment technology to these very large engines. 
Overall, the coordinated strategy constitutes a comprehensive program 
that addresses the problems caused by ocean-going vessel emissions from 
both a near-term and long-term perspective. It does this while 
providing for an orderly and cost-effective implementation schedule for 
the vessel owners and manufacturers, and in a way that is consistent 
with the international requirements for these vessels.
    The human health and welfare impacts of emissions from Category 3 
vessels, along with estimates of their contribution to national 
emission inventories, are described in Section II. The new tiers of 
engine emission standards under the Clean Air Act for addressing these 
emissions, and our justifications for them, are discussed in Section 
III. Section IV contains changes to our existing marine diesel fuel 
program. In Section V, we describe a key component of the coordinated 
strategy: The recently-submitted proposal to amend MARPOL Annex VI to 
designate U.S. coasts as an ECA, as well as the IMO amendment process.
    In addition to the new emission limits, we are finalizing several 
revisions to our Clean Air Act testing, certification, and compliance 
provisions to better ensure emission control in use. We are also 
finalizing regulations for the purpose of implementing MARPOL Annex VI 
pursuant to the Act to Prevent Pollution from Ships (33 U.S.C. 1901 et 
seq.). These revisions are described in Section VI. Sections VII and 
VIII present the estimated costs and benefits of our coordinated 
program to address OGV emissions.
(1) What CAA Standards Is EPA Finalizing?
    We are finalizing new tiers of Category 3 marine diesel engine 
standards under our Clean Air Act authority, as well as certain 
revisions to our marine fuel program.
    Category 3 Engine Standards. Previous standards for Category 3 
engines were adopted in 2003. These Tier 1 standards are equivalent to 
the first tier of MARPOL Annex VI NOX limits and require the 
use of control technology comparable to that used by nonroad engines in 
the early 1990s. We did not adopt PM standards at that time because the 
vast majority of PM emissions from Category 3 engines are the result of 
the sulfur content of the residual fuel they use and because of 
measurement issues.\5\ The combination of the engine and fuel standards 
we are finalizing and the U.S. Government proposal for ECA designation 
will

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require all vessels that operate in coastal areas that affect U.S. air 
quality to control emissions of NOX, SOX, and PM.
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    \5\ As explained in the proposed rule leading to the 2003 final 
rule, there were concerns about measuring PM from Category 3 marine 
engines (67 FR 37569, May 29, 2002). Specifically, established PM 
test methods showed unacceptable variability when sulfur levels 
exceed 0.8 weight percent. However, as described in Section VI, we 
now believe these measurement issues have been resolved.
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    We are revising our engine requirements under the Clean Air Act to 
include two additional tiers of NOX standards for new 
Category 3 marine diesel engines installed on vessels flagged or 
registered in the United States. The near-term Tier 2 standards will 
apply beginning in 2011 and will require more efficient use of engine 
technologies being used today, including engine timing, engine cooling, 
and advanced computer controls. The long-term Tier 3 standards will 
apply beginning in 2016 and will require the use of more advanced 
technology such as selective catalytic reduction.
    Because much of the operation of U.S. vessels occurs in areas that 
will have little, if any, impact on U.S. air quality, our Clean Air Act 
program will allow the use of alternative emission control devices 
(AECDs) that will permit a ship to meet less stringent requirements on 
the open sea. The use of these devices will be subject to certain 
restrictions, including a requirement that the AECD not disable 
emission controls while operating in areas where emissions can 
reasonably be expected to adversely affect U.S. air quality, and that 
the engine is equipped with a NOX emission monitoring 
device. In addition, the engine will be required to meet the Tier 2 
NOX limits when the AECD is implemented, and an AECD will 
not be allowed on any Tier 2 or earlier engine.
    In addition to the NOX emission limits, we are 
finalizing standards for emissions of hydrocarbons (HC) and carbon 
monoxide (CO) from new Category 3 engines. As explained in Section 
III.B.1, below, we are not setting a standard for PM emissions for 
Category 3 engines. However, significant PM emissions control will be 
achieved through the ECA fuel sulfur requirements that will apply 
through APPS to ships that operate in areas that affect U.S. air 
quality. We are also requiring engine manufacturers to measure and 
report PM emissions pursuant to our authority in section 208 of the 
Clean Air Act.
    Fuel Sulfur Limits. We are finalizing fuel sulfur limits under 
section 211(c) of the Clean Air Act that match the limits that apply 
under Annex VI in ECAs. First, we are revising our existing diesel fuel 
program to allow for the production and sale of 1,000 ppm sulfur fuel 
for use in Category 3 marine vessels. This will allow production and 
distribution of fuel consistent with the new sulfur limits that will 
become applicable, under Annex VI, in ECAs beginning in 2015. Our 
current diesel fuel program sets a sulfur limit of 15 ppm that will be 
fully phased-in by December 1, 2014 for land-based nonroad, locomotive, 
and marine (NRLM) diesel fuel produced for distribution, sale and use 
in the United States. Without this change to our existing diesel fuel 
regulations, fuel with a sulfur content of up to 1,000 ppm could be 
used in Category 3 marine vessels, but it could not be legally produced 
in the U.S. after June 1, 2014. Second, we are generally forbidding the 
production and sale of fuel oil with a sulfur content above 1,000 ppm 
for use in the waters within the proposed ECA (see Note 3, supra). The 
exception to this is if the vessel uses alternative devices, 
procedures, or compliance methods that achieve equivalent emission 
control as operating on 1,000 ppm sulfur fuel.
(2) What Is the U.S. Government Proposal for Designation of an Emission 
Control Area?
    MARPOL Annex VI contains international standards for air emissions 
from ships, including NOX, SOX, and PM emissions. 
The Annex VI NOX and SOX/PM limits are set out in 
Table I-1. Annex VI was adopted by the Parties in 1997 but did not go 
into force until 2005, after it was ratified by fifteen countries 
representing at least 50 percent of the world's merchant shipping 
tonnage. These Annex VI NOX standards currently apply to all 
engines above 130 kW installed on a ship constructed on or after 
January 1, 2000 and reduce NOX emissions by about 30 percent 
from uncontrolled levels. As originally adopted, Annex VI included two 
fuel sulfur limits: A global limit of 45,000 ppm and a more stringent 
15,000 ppm limit for SOX Emission Control Areas (SECAs). 
This approach ensures that the cleanest fuel is used in areas that 
demonstrate a need for additional SOX reductions, while 
retaining the ability of ships to use higher-sulfur residual fuel on 
the open ocean.
    Annex VI was amended in October 2008, adding two tiers of 
NOX limits (Tier II and Tier III) and two sets of fuel 
sulfur standards.\6\ These amendments will enter into force on July 1, 
2010. The most stringent NOX and fuel sulfur limits are 
regionally based and will apply only in designated ECAs.
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    \6\ Note that the MARPOL Annex VI standards are referred to as 
Tiers I, II, and III; EPA's Category 3 emission standards are 
referred to as Tiers 1, 2, and 3.

                                            Table I-1--Annex VI NOX Emission Standards and Fuel Sulfur Limits
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                                                                                                      Less than 130    130-2,000  RPM
                                                                                                           RPM               \a\         Over 2,000  RPM
--------------------------------------------------------------------------------------------------------------------------------------------------------
NOX g/kW-hr...................................  Tier I..........................          \b\ 2004              17.0   45.0[middot]n(-               9.8
                                                                                                                                 0.20)
                                                Tier II.........................              2011              14.4   44.0[middot]n(-               7.7
                                                                                                                                 0.23)
                                                Tier III........................              2016               3.4    9.0[middot]n(-               2.0
                                                                                                                                 0.23)
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                                                        Global
                                                          ECA
----------------------------------------------------------------------------------------------------------------
Fuel Sulfur.............................              2004      c 45,000 ppm              2005      c 15,000 ppm
                                                      2012      c 35,000 ppm              2010      c 10,000 ppm
                                                      2020     c d 5,000 ppm              2015       c 1,000 ppm
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Notes:
\a\ Applicable standards are calculated from n (maximum in-use engine speed in revolutions per minute (rpm)),
  rounded to one decimal place.
\b\ Tier 1 NOX standards apply for engines originally manufactured after 2004, and proposed also to certain
  earlier engines.
\c\ Annex VI standards are in terms of percent sulfur. Global sulfur limits are 4.5%; 3.5%; 0.5%. ECA sulfur
  limits are 1.5%; 1.0%; 0.1%.
\d\ Subject to a feasibility review in 2018; may be delayed to 2025.

    To realize the benefits from the MARPOL Annex VI Tier III NOX and 
most stringent fuel sulfur controls, areas must be designated as 
Emission Control Areas. On July 17, 2009, the IMO approved in principle 
a U.S.-Canada proposal to amend MARPOL Annex VI to designate North 
American coastal waters as an ECA (referred to as the

[[Page 22900]]

``U.S./Canada ECA'' or the ``North American ECA'').\7\ In addition, 
France has joined the ECA proposal on behalf of the Saint Pierre and 
Miquelon archipelago. A description of this proposal and the IMO ECA 
designation process is set out in Section V. ECA designation would 
ensure that ships that affect U.S. air quality meet stringent 
NOX and fuel sulfur requirements while operating within 200 
nautical miles of U.S. coasts. We expect the North American proposal 
will be adopted by the Parties to MARPOL Annex VI in March 2010, 
entering into force as early as 2012. If, however, the proposed 
amendment is not adopted in a timely manner, we intend to take 
supplemental action to control harmful emissions from vessels that 
affect U.S. air quality.
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    \7\ Proposal to Designate an Emission Control Area for Nitrogen 
Oxides, Sulphur Oxides and Particulate Matter, Submitted by the 
United States and Canada. IMO Document MEPC59/6/5, 27 March 2009. A 
copy of this document can be found at https://www.epa.gov/otaq/regs/nonroad/marine/ci/mepc-59-eca-proposal.pdf.
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(3) Regulations To Implement Annex VI
    The United States became a party to MARPOL Annex VI by depositing 
its instrument of ratification with IMO on October 8, 2008. This was 
preceded by the President signing into law the Maritime Pollution 
Prevention Act of 2008 (Pub. L. 110-280) on July 21, 2008, that 
contains amendments to the Act to Prevent Pollution from Ships (33 
U.S.C. 1901 et seq.). These APPS amendments require compliance with 
Annex VI by all persons subject to the engine and vessel requirements 
of Annex VI. The amendments also authorize the U.S. Coast Guard and EPA 
to enforce the provisions of Annex VI against domestic and foreign 
vessels and to develop implementing regulations, as necessary. In 
addition, APPS gives EPA sole authority to certify engines installed on 
U.S. vessels to the Annex VI requirements. This final rule contains 
regulations codifying the Annex VI requirements and regulations to 
implement several aspects of the Annex VI engine and fuel regulations, 
which we are finalizing under that APPS authority. Our cost and benefit 
analyses for the coordinated strategy include the costs for U.S. 
vessels to implement the requirements of this MARPOL Annex VI program, 
including requirements that will apply upon entry into force of the 
North American ECA.
(4) Technical Amendments
    The finalized regulations also include technical amendments to our 
motor vehicle and nonroad engine regulations. Many of these changes 
involve minor adjustments or corrections to our recently finalized rule 
for new nonroad spark-ignition engines, or adjustment to other 
regulatory provisions to align with this recent final rule.
(5) Summary
    The emission control requirements in our coordinated strategy are 
the MARPOL Annex VI global Tier II NOX standards included in 
the amendments to Annex VI and the ECA Tier III NOX limits 
and fuel sulfur limits that will apply when the U.S. coasts are 
designated as an ECA through an additional amendment to Annex VI. The 
Annex VI requirements, including the future ECA requirements, will be 
enforceable for U.S. and foreign vessels operating in U.S. waters 
through the Act to Prevent Pollution from Ships.
    We are also adopting the NOX emission standards for 
Category 3 engines on U.S. vessels under section 213 of the Clean Air 
Act.
    Finally, we are adopting additional requirements that are not part 
of the Annex VI program or the ECA. These are (1) limits on hydrocarbon 
and carbon monoxide emissions for Category 3 engines; (2) a PM 
measurement requirement to obtain data on PM emissions from engines 
operating on distillate fuel; and (3) changes to our diesel fuel 
program under the Clean Air Act to allow production and sale of ECA-
compliant fuel. We are also changing our emission control program for 
smaller marine diesel engines to harmonize with the Annex VI 
NOX requirements for U.S. vessels that operate 
internationally.

B. Why Is EPA Making This Rule?

(1) Category 3 Engines Contribute to Serious Air Quality Problems
    Category 3 engines generate significant emissions of 
PM2.5, SOX, and NOX that contribute to 
nonattainment of the National Ambient Air Quality Standards (NAAQS) for 
PM2.5 and ground-level ozone (smog). NOX and 
SOX are both precursors to secondary PM2.5 
formation. Both PM2.5 and NOX adversely affect 
human health. NOX is a key precursor to ozone as well. 
NOX, SOX and PM2.5 emissions from 
ocean-going vessels also cause harm to public welfare, including 
contributing to deposition of nitrogen and sulfur, visibility 
impairment and other harmful environmental impacts across the U.S.
    The health and environmental effects associated with these 
emissions are a classic example of a negative externality (an activity 
that imposes uncompensated costs on others). With a negative 
externality, an activity's social cost (the costs borne to society 
imposed as a result of the activity taking place) is not taken into 
account in the total cost of producing goods and services. In this 
case, as described in this section below and in Section II, emissions 
from ocean-going vessels impose public health and environmental costs 
on society, and these added costs to society are not reflected in the 
costs of providing the transportation services. The market system 
itself cannot correct this externality because firms in the market are 
rewarded for minimizing their production costs, including the costs of 
pollution control. In addition, firms that may take steps to use 
equipment that reduces air pollution may find themselves at a 
competitive disadvantage compared to firms that do not. To correct this 
market failure and reduce the negative externality from these 
emissions, we are setting a cap on the rate of emission production from 
these sources. EPA's coordinated strategy for ocean-going vessels will 
accomplish this since both domestic and foreign ocean-going vessels 
will be required to reduce their emissions to a technologically 
feasible limit.
    Emissions from ocean-going vessels account for substantial portions 
of the country's ambient PM2.5, SOX and 
NOX levels. We estimate that in 2009 these engines account 
for about 80 percent of mobile source sulfur dioxide (SO2) 
emissions, 10 percent of mobile source NOX emissions and 
about 24 percent of mobile source diesel PM2.5 emissions. 
Emissions from ocean-going vessels are expected to dominate the mobile 
source inventory in the future, due to both the expected emission 
reductions from other mobile sources as a result of more stringent 
emission controls and due to growth in the demand for ocean 
transportation services. By 2030, the coordinated strategy will reduce 
annual SO2 emissions from these diesel engines by 1.3 
million tons, annual NOX emissions by 1.2 million tons, and 
PM2.5 emissions by 143,000 tons, and those reductions will 
continue to grow beyond 2030 as fleet turnover to the clean engines 
continues. While a share of these emissions occur at sea, our air 
quality modeling results described in Section II show they have a 
significant impact on ambient air quality far inland.
    Both ozone and PM2.5 are associated with serious public 
health problems, including premature mortality, aggravation of 
respiratory and cardiovascular disease (as indicated by increased 
hospital admissions and emergency room visits, school absences, lost 
work days, and restricted activity days), changes in lung function and 
increased respiratory symptoms, altered

[[Page 22901]]

respiratory defense mechanisms, and chronic bronchitis. Diesel exhaust 
is of special public health concern, and since 2002 EPA has classified 
it as likely to be carcinogenic to humans by inhalation at 
environmental exposures. Recent studies are showing that populations 
living near large diesel emission sources such as major roadways, rail 
yards, and marine ports are likely to experience greater diesel exhaust 
exposure levels than the overall U.S. population, putting them at 
greater health risks.8 9 10 
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    \8\ U. S. EPA (2004). Final Regulatory Impact Analysis: Control 
of Emissions from Nonroad Diesel Engines, Chapter 3. Report No. 
EPA420-R-04-007. https://www.epa.gov/nonroad-diesel/2004fr.htm#ria.
    \9\ State of California Air Resources Board. (2004). Roseville 
Rail Yard Study. Sacramento, CA: California EPA, California Air 
Resources Board (CARB). Stationary Source Division. This document is 
available electronically at: https://www.arb.ca.gov/diesel/documents/rrstudy.htm.
    \10\ Di, P., Servin, A., Rosenkranz, K., Schwehr, B., Tran, H., 
(2006). Diesel Particulate Matter Exposure Assessment Study for the 
Ports of Los Angeles and Long Beach. Sacramento, CA: California EPA, 
California Air Resources Board (CARB). Retrieved March 19, 2009 from 
https://www.arb.ca.gov/regact/marine2005/portstudy0406.pdf.
---------------------------------------------------------------------------

    EPA recently updated its initial screening-level analysis \11\ of 
selected marine port areas to better understand the populations that 
are exposed to diesel particulate matter emissions from these 
facilities.12 13 14 15 This screening-level analysis focused 
on a representative selection of national marine ports.\16\ Of the 45 
marine ports selected, the results indicate that at least 18 million 
people, including a disproportionate number of low-income households, 
African-Americans, and Hispanics, live in the vicinity of these 
facilities and are being exposed to ambient diesel PM levels that are 
2.0 [micro]g/m\3\ and 0.2 [micro]g/m\3\ above levels found in areas 
further from these facilities. Considering only ocean-going marine 
engine diesel PM emissions, the results indicate that 6.5 million 
people are exposed to ambient diesel particulate matter (DPM) levels 
that are 2.0 [micro]g/m\3\ and 0.2 [micro]g/m\3\ above levels found in 
areas further from these facilities. Because those populations exposed 
to diesel PM emissions from marine ports are more likely to be low-
income and minority residents, these populations would benefit from the 
controls being proposed in this action. The detailed findings of this 
study are available in the public docket for this rulemaking.
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    \11\ This type of screening-level analysis is an inexact tool 
and not appropriate for regulatory decision-making; it is useful in 
beginning to understand potential impacts and for illustrative 
purposes. Additionally, the emissions inventories used as inputs for 
the analyses are not official estimates and likely underestimate 
overall emissions because they are not inclusive of all emission 
sources at the individual ports in the sample.
    \12\ ICF International. September 28, 2007. Estimation of diesel 
particulate matter concentration isopleths for marine harbor areas 
and rail yards. Memorandum to EPA under Work Assignment Number 0-3, 
Contract Number EP-C-06-094. This memo is available in Docket EPA-
HQ-OAR-2007-0121.
    \13\ ICF International. September 28, 2007. Estimation of diesel 
particulate matter population exposure near selected harbor areas 
and rail yards. Memorandum to EPA under Work Assignment Number 0-3, 
Contract Number EP-C-06-094. This memo is available in Docket EPA-
HQ-OAR-2007-0121.
    \14\ ICF International, December 10, 2008. Estimation of diesel 
particulate matter population exposure near selected harbor areas 
with revised harbor emissions. Memorandum to EPA under Work 
Assignment Number 2-9. Contract Number EP-C-06-094. This memo is 
available in Docket EPA-HQ-OAR-2007-0121.
    \15\ ICF International. December 1, 2008. Estimation of diesel 
particulate matter concentration isopleths near selected harbor 
areas with revised emissions. Memorandum to EPA under Work 
Assignment Number 1-9. Contract Number EP-C-06-094. This memo is 
available in Docket EPA-HQ-OAR-2007-0121.
    \16\ The Agency selected a representative sample from the top 
150 U.S. ports including coastal and Great Lake ports.
---------------------------------------------------------------------------

    Even outside port areas, millions of Americans continue to live in 
areas that do not meet existing air quality standards today. With 
regard to PM2.5 nonattainment, in 2005 EPA designated 39 
nonattainment areas for the 1997 PM2.5 NAAQS (70 FR 943, 
January 5, 2005). These areas are composed of 208 full or partial 
counties with a total population exceeding 88 million. The 1997 
PM2.5 NAAQS was recently revised and the 2006 
PM2.5 NAAQS became effective on December 18, 2006. As of 
December 22, 2008, there are 58 2006 PM2.5 nonattainment 
areas composed of 211 full or partial counties. These numbers do not 
include individuals living in areas that may fail to maintain or 
achieve the PM2.5 NAAQS in the future. Currently, ozone 
concentrations exceeding the 8-hour ozone NAAQS occur over wide 
geographic areas, including most of the nation's major population 
centers. As of December 2008, there are approximately 132 million 
people living in 57 areas (293 full or partial counties) designated as 
not in attainment with the 8-hour ozone NAAQS. These numbers do not 
include people living in areas where there is a potential that the area 
may fail to maintain or achieve the 8-hour ozone NAAQS.
    In addition to public health impacts, there are serious public 
welfare and environmental impacts associated with PM2.5 and 
ozone emissions. Specifically, NOX and SOX 
emissions from diesel engines contribute to the acidification, 
nitrification, and eutrophication of water bodies. NOX, 
SOX and direct emissions of PM2.5 can contribute 
to the substantial impairment of visibility in many parts of the U.S. 
where people live, work, and recreate, including national parks, 
wilderness areas, and mandatory class I Federal areas.\17\ The 
deposition of airborne particles can also reduce the aesthetic appeal 
of buildings and culturally important articles through soiling, and can 
contribute directly (or in conjunction with other pollutants) to 
structural damage by means of corrosion or erosion. Finally, ozone 
causes damage to vegetation which leads to crop and forestry economic 
losses, as well as harm to national parks, wilderness areas, and other 
natural systems.
---------------------------------------------------------------------------

    \17\ These areas are defined in section 162 of the Act as those 
national parks exceeding 6,000 acres, wilderness areas and memorial 
parks exceeding 5,000 acres, and all international parks which were 
in existence on August 7, 1977. Section 169 of the Clean Air Act 
provides additional authority to address existing visibility 
impairment and prevent future visibility impairment in the 156 
national parks, forests and wilderness areas categorized as 
mandatory class I Federal areas.
---------------------------------------------------------------------------

    EPA has already adopted many emission control programs that are 
expected to reduce ambient PM2.5 and ozone levels, including 
the Nonroad Spark Ignition Engine rule (73 FR 59034, Oct 8, 2008), the 
Locomotive and Marine Diesel Engine Rule (73 FR 25098, May 6, 2008), 
the Clean Air Interstate Rule (CAIR) (70 FR 25162, May 12, 2005), the 
Clean Air Nonroad Diesel Rule (69 FR 38957, June 29, 2004), the Heavy 
Duty Engine and Vehicle Standards and Highway Diesel Fuel Sulfur 
Control Requirements (66 FR 5002, Jan. 18, 2001), and the Tier 2 
Vehicle and Gasoline Sulfur Program (65 FR 6698, Feb. 10, 2000). The 
additional PM2.5, SOX, and NOX 
emission reductions resulting from the coordinated approach described 
in this action will assist States in attaining and maintaining the 
PM2.5 and ozone NAAQS near term and in the decades to come.
    Our air quality modeling projects that in 2020 at least 13 counties 
with about 30 million people may violate the 1997 standards for 
PM2.5 and 50 counties with about 50 million people may 
violate the 2008 standards for ozone. These numbers likely 
underestimate the impacted population since they do not include the 
people who live in areas which do not meet the 2006 PM2.5 
NAAQS. In addition, these numbers do not include the additional 13 
million people in 12 counties who live in areas that have air quality 
measurements within 10 percent of the 1997 PM2.5 NAAQS and 
the additional 80 million people in 135 counties who live in areas

[[Page 22902]]

that have air quality measurements within 10% of the 2008 ozone NAAQS. 
The emission reductions resulting from this coordinated strategy will 
assist these and other States to both attain and maintain the 
PM2.5 and ozone NAAQS.
    State and local governments are working to protect the health of 
their citizens and comply with requirements of the Clean Air Act. As 
part of this effort, they recognize the need to secure additional major 
reductions in diesel PM2.5, SOX and 
NOX emissions by undertaking numerous State level actions, 
while also seeking Agency action, including the Category 3 engine 
standards being finalized in this final rule and the U.S. proposal to 
IMO to amend Annex VI to designate U.S. coastal areas as an ECA, and 
related certification and fuel provisions under the Clean Air Act to 
complement that ECA proposal. EPA's coordinated strategy to reduce OGV 
emissions through engine emission controls and fuel sulfur limits will 
play a critical part in State efforts to attain and maintain the NAAQS 
through the next two decades.
    In addition to regulatory programs, the Agency has a number of 
innovative programs that partner government, industry, and local 
communities together to help address challenging air quality problems. 
Under the National Clean Diesel Campaign, EPA promotes a variety of 
emission reduction strategies such as retrofitting, repairing, 
replacing and repowering engines, reducing idling and switching to 
cleaner fuels.
    In 2008, Congress appropriated funding for the Diesel Emission 
Reduction Program under the Energy Policy Act of 2005 (EPAct 2005) to 
reduce emissions from heavy-duty diesel engines in the existing fleet. 
The EPAct 2005 directs EPA to break the funding into two different 
components: a National competition and a State allocation program. The 
National Program, with 70 percent of the funding, consists of three 
separate competitions: (1) The National Clean Diesel Funding Assistance 
Program; (2) the National Clean Diesel Emerging Technologies Program; 
and (3) the SmartWay Clean Diesel Finance Program. The State Clean 
Diesel Grant and Loan Program utilizes the remaining 30 percent of the 
funding. In the first year of the program, EPA awarded 119 grants 
totaling $49.2 million for diesel emission reduction projects and 
programs across the country for cleaner fuels, verified technologies, 
and certified engine configurations.
    Through $300 million in funding provided to the Diesel Emission 
Reduction Program under the American Reinvestment and Recovery Act of 
2009, EPA will promote and preserve jobs while improving public health 
and achieving significant reductions in diesel emissions.
    Furthermore, EPA's National Clean Diesel Campaign, through its 
Clean Ports USA program, is working with port authorities, terminal 
operators, shipping, truck, and rail companies to promote cleaner 
diesel technologies and strategies through education, incentives, and 
financial assistance for diesel emission reductions at ports. Part of 
these efforts involves clean diesel programs that can further reduce 
emissions from the existing fleet of diesel engines. Finally, many of 
the companies operating in States and communities suffering from poor 
air quality have voluntarily entered into Memoranda of Understanding 
(MOUs) designed to ensure that the cleanest technologies are used first 
in regions with the most challenging air quality issues.
    Taken together, these voluntary approaches can augment the 
coordinated strategy and help States and communities achieve larger 
reductions sooner in the areas of our country that need them the most. 
The Agency remains committed to furthering these programs and others so 
that all of our citizens can breathe clean healthy air.
(2) Advanced Emission Technology Solutions Are Available
    Air pollution from marine diesel exhaust is a challenging problem. 
However, we believe manufacturers can apply a combination of existing 
and new technologies to meet the emission standards we are adopting in 
this final rule. Optimizing air intake fuel injection systems can 
substantially reduce engine-out emissions. Further NOX 
control can be achieved with advanced technology such as aftertreatment 
devices with high-efficiency catalysts. As discussed in greater detail 
in Section III.C, the development of these aftertreatment technologies 
for highway and nonroad diesel applications has advanced rapidly in 
recent years, so that very large emission reductions in NOX 
emissions can be achieved. Manufacturers might also deploy other 
advanced technologies such as water-based in-cylinder controls to 
reduce NOX emissions.
    While aftertreatment technologies can be sensitive to sulfur, their 
use will be required only in ECAs designated under MARPOL Annex VI, and 
they are expected to be able to operate on ECA fuel meeting a 1,000 ppm 
fuel sulfur. With the lead time available and the assurance of 1,000 
ppm fuel for ocean-going vessels in 2015, as would be required through 
ECA designation for U.S. coasts, we are confident the application of 
advanced NOX technology to Category 3 marine engines will 
proceed at a reasonable rate of progress and will result in systems 
capable of achieving the finalized standards on schedule. Use of this 
lower sulfur fuel will also result in substantial PM emission 
reductions, since PM emissions from Category 3 engines come mostly from 
the use of high sulfur residual fuel. Note that vessels may be equipped 
with alternative devices, procedures, or compliance methods provided 
they achieve equivalent emissions reductions.

C. Statutory Basis for Action

    Authority for the actions proposed in this documents is granted to 
the Environmental Protections Agency by sections 114, 203, 205, 206, 
207, 208, 211, 213, 216, and 301(a) of the Clean Air Act as amended in 
1990 (42 U.S.C. 7414, 7522, 7524, 7525, 7541, 7542, 7545, 7547, 7550 
and 7601(a)), and by sections 1901-1915 of the Act to Prevent Pollution 
from Ships (33 U.S.C. 1909 et seq.).
(1) Clean Air Act Basis for Action
    EPA is proposing the fuel requirements pursuant to its authority in 
section 211(c) of the Clean Air Act, which allows EPA to regulate fuels 
that contribute to air pollution that endangers public health or 
welfare (42 U.S.C. 7545(c)). As discussed previously in EPA's Clean Air 
Nonroad Diesel rule (69 FR 38958) and in Section II, the combustion of 
high sulfur diesel fuel by nonroad, locomotive, and marine diesel 
engines contributes to air quality problems that endanger public health 
and welfare. Section II also discusses the significant contribution to 
these air quality problems by Category 3 marine vessels. Additional 
support for the procedural and enforcement-related aspects of the fuel 
controls in the final rule, including the recordkeeping requirements, 
comes from Clean Air Act sections 114(a) and 301(a) (42 U.S.C. sections 
7414(a) and 7601(a)).
    EPA is finalizing emission standards for new Category 3 marine 
diesel engines pursuant to its authority under section 213(a)(3) of the 
Clean Air Act, which directs the Administrator to set standards 
regulating emissions of NOX, volatile organic compounds 
(VOCs), or CO for classes or categories of engines, such as marine 
diesel engines, that contribute to ozone or carbon monoxide 
concentrations in more than one nonattainment area. These ``standards 
shall achieve the greatest degree of

[[Page 22903]]

emission reduction achievable through the application of technology 
which the Administrator determines will be available for the engines or 
vehicles, giving appropriate consideration to cost, lead time, noise, 
energy, and safety factors associated with the application of such 
technology.''
    EPA is finalizing a PM measurement requirement for new Category 3 
marine diesel engines pursuant to its authority under section 208, 
which requires manufacturers and other persons subject to Title II 
requirements to ``provide information the Administrator may reasonably 
require * * * to otherwise carry out the provisions of this part * * 
*''
    EPA is also acting under its authority to implement and enforce the 
Category 3 marine diesel emission standards. Section 213(d) provides 
that the standards EPA adopts for marine diesel engines ``shall be 
subject to Sections 206, 207, 208, and 209'' of the Clean Air Act, with 
such modifications that the Administrator deems appropriate to the 
regulations implementing these sections.'' In addition, the marine 
standards ``shall be enforced in the same manner as [motor vehicle] 
standards prescribed under section 202'' of the Act. Section 213(d) 
also grants EPA authority to promulgate or revise regulations as 
necessary to determine compliance with and enforce standards adopted 
under section 213.
    As required under section 213(a)(3), we believe the evidence 
provided in Section III.C and in Chapter 4 of Final Regulatory Impact 
Analysis (RIA) indicates that the stringent NOX emission 
standards finalized in this final rule for newly built Category 3 
marine diesel engines are feasible and reflect the greatest degree of 
emission reduction achievable through the use of technology that will 
be available in the model years to which they apply. We have given 
appropriate consideration to costs in finalizing these standards. Our 
review of the costs and cost-effectiveness of these standards indicate 
that they are reasonable and comparable to the cost-effectiveness of 
other mobile source emission reduction strategies that have been 
required. We have also reviewed and given appropriate consideration to 
the energy factors of this rule in terms of fuel efficiency as well as 
any safety and noise factors associated with these standards.
    The information in Section II and Chapter 2 of the Final Regulatory 
Impact Analysis regarding air quality and public health impacts 
provides strong evidence that emissions from Category 3 marine diesel 
engines significantly and adversely impact public health or welfare. 
EPA has already found in previous rules that emissions from new marine 
diesel engines contribute to ozone and CO concentrations in more than 
one area which has failed to attain the ozone and carbon monoxide NAAQS 
(64 FR 73300, December 29, 1999).
    The NOX and PM emission reductions achieved through the 
coordinated strategy will be important to States' efforts to attain and 
maintain the Ozone and the PM2.5 NAAQS in the near term and 
in the decades to come, and will significantly reduce the risk of 
adverse effects to human health and welfare.
(2) APPS Basis for Action
    EPA is finalizing regulations to implement MARPOL Annex VI pursuant 
to its authority in section 1903 of the Act to Prevent Pollution from 
Ships (APPS). Section 1903 gives the Administrator the authority to 
prescribe any necessary or desired regulations to carry out the 
provisions of Regulations 12 through 19 of Annex VI.
    The Act to Prevent Pollution from Ships implements Annex VI and 
makes those requirements enforceable domestically. However, certain 
clarifications are necessary for implementing Regulation 13 and the 
requirements of the NOX Technical Code with respect to 
issuance of Engine International Air Pollution Prevention (EIAPP) 
certificates and approval of alternative compliance methods. 
Clarification is also needed with respect to the application of the 
Annex VI requirements to certain U.S. and foreign vessels that operate 
in U.S. waters.

II. Air Quality, Health and Welfare Impacts

    The coordinated strategy will significantly reduce emissions of 
NOX, PM, and SOX from ocean-going vessels. 
Emissions of these compounds contribute to PM and ozone nonattainment 
and environmental effects including deposition, visibility impairment 
and harm to ecosystems from ozone. In addition diesel particulate 
matter is associated with a host of adverse health effects, including 
cancer.
    This section summarizes the general health and welfare effects of 
these emissions and the modeled projections of changes in air quality 
due to the coordinated strategy. Interested readers are encouraged to 
refer to the RIA for more in-depth discussions.

A. Public Health Impacts

(1) Particulate Matter
    Particulate matter is a generic term for a broad class of 
chemically and physically diverse substances. It can be principally 
characterized as discrete particles that exist in the condensed (liquid 
or solid) phase spanning several orders of magnitude in size. Since 
1987, EPA has delineated that subset of inhalable particles small 
enough to penetrate to the thoracic region (including the 
tracheobronchial and alveolar regions) of the respiratory tract 
(referred to as thoracic particles). Current NAAQS use PM2.5 
as the indicator for fine particles (with PM2.5 referring to 
particles with a nominal mean aerodynamic diameter less than or equal 
to 2.5 [mu]m), and use PM10 as the indicator for purposes of 
regulating the coarse fraction of PM10 (referred to as 
thoracic coarse particles or coarse-fraction particles; generally 
including particles with a nominal mean aerodynamic diameter greater 
than 2.5 [mu]m and less than or equal to 10 [mu]m, or 
PM10-2.5). Ultrafine particles are a subset of fine 
particles, generally less than 100 nanometers (0.1 [mu]m) in 
aerodynamic diameter.
    Fine particles are produced primarily by combustion processes and 
by transformations of gaseous emissions (e.g., SOX, 
NOX and VOC) in the atmosphere. The chemical and physical 
properties of PM2.5 may vary greatly with time, region, 
meteorology, and source category. Thus, PM2.5 may include a 
complex mixture of different pollutants including sulfates, nitrates, 
organic compounds, elemental carbon and metal compounds. These 
particles can remain in the atmosphere for days to weeks and travel 
hundreds to thousands of kilometers.
(a) Health Effects of PM
    Scientific studies show ambient PM is associated with a series of 
adverse health effects. These health effects are discussed i