Prevention of Significant Deterioration and Title V Greenhouse Gas Tailoring Rule Step 3, GHG Plantwide Applicability Limitations and GHG Synthetic Minor Limitations, 14226-14264 [2012-5431]
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Federal Register / Vol. 77, No. 46 / Thursday, March 8, 2012 / Proposed Rules
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR Parts 51, 52, 70 and 71
[EPA–HQ–OAR–2009–0517; FRL–9643–8]
RIN 2060–AR10
Prevention of Significant Deterioration
and Title V Greenhouse Gas Tailoring
Rule Step 3, GHG Plantwide
Applicability Limitations and GHG
Synthetic Minor Limitations
Environmental Protection
Agency (EPA).
ACTION: Proposed rule.
AGENCY:
This proposal concerns the
third step (Step 3) in the EPA’s
Tailoring Rule. We are proposing to
maintain the applicability thresholds for
greenhouse gas (GHG)-emitting sources
at the current levels. We are also
proposing two streamlining approaches,
which will improve the administration
of GHG Prevention of Significant
Deterioration (PSD) and title V
permitting programs. The first proposal
addresses the implementation of GHG
plantwide applicability limitations
(PALs). We propose to allow permitting
authorities to issue GHG PALs on either
a mass-basis (tpy) or a carbon dioxide
equivalent (CO2e)-basis and to allow
PALs to be used as an alternative
approach for determining whether a
project is a major modification and
whether GHG emissions are subject to
regulation. The second proposal would
create the regulatory authority for the
EPA to issue synthetic minor limitations
for GHGs in areas subject to a GHG PSD
Federal Implementation Plan (FIP). We
also discuss our progress in evaluating
the suitability of other streamlining
approaches and solicit further comment.
DATES: Comments must be received on
or before April 20, 2012.
Public Hearing. One public hearing
will be held on March 20, 2012. For
additional instructions on the public
hearing, go to the SUPPLEMENTARY
INFORMATION section of this document.
ADDRESSES: Submit your comments,
identified by Docket ID No. EPA–HQ–
OAR–2009–0517, by one of the
following methods:
• https://www.regulations.gov: Follow
the online instructions for submitting
comments.
• Email: a-and-r-docket@epa.gov.
Attention Docket ID No. EPA–HQ–
OAR–2009–0517.
• Fax: (202) 566–9744.
• Mail: Attention Docket ID No. EPA–
HQ–OAR–2009–0517, Air and Radiation
Docket and Information Center,
Mailcode: 2822T, U.S. Environmental
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SUMMARY:
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Protection Agency, 1200 Pennsylvania
Avenue NW., Washington, DC 20460.
Please include a total of two copies. In
addition, please mail a copy of your
comments on the information collection
provisions to the Office of Information
and Regulatory Affairs, Office of
Management and Budget, Attn: Desk
Officer for EPA, 725 17th Street NW.,
Washington, DC 20503.
• Hand Delivery: Air and Radiation
Docket and Information Center, EPA/
DC, EPA West, Room 3334, 1301
Constitution Avenue NW., Washington,
DC 20004, Attention Docket ID No.
EPA–HQ–OAR–2009–0517. Such
deliveries are only accepted during the
Docket Center’s normal hours of
operation, and special arrangements
should be made for deliveries of boxed
information.
Instructions: Direct your comments to
Docket ID No. EPA–HQ–OAR–2009–
0517. The EPA’s policy is that all
comments received will be included in
the public docket without change and
may be made available online at www.
regulations.gov, including any personal
information provided, unless the
comment includes information claimed
to be Confidential Business Information
(CBI) or other information whose
disclosure is restricted by statute. Do
not submit information that you
consider to be CBI or otherwise
protected through www.regulations.gov
or email. The www.regulations.gov Web
site is an ‘‘anonymous access’’ system,
which means the EPA will not know
your identity or contact information
unless you provide it in the body of
your comment. If you send an email
comment directly to the EPA without
going through www.regulations.gov your
email address will be automatically
captured and included as part of the
comment that is placed in the public
docket and made available on the
Internet. If you submit an electronic
comment, the EPA recommends that
you include your name and other
contact information in the body of your
comment and with any disk or CD–ROM
you submit. If the EPA cannot read your
comment due to technical difficulties
and cannot contact you for clarification,
the EPA may not be able to consider
your comment. Electronic files should
avoid the use of special characters, any
form of encryption, and be free of any
defects or viruses. For additional
instructions on submitting comments,
go to section I.C of the SUPPLEMENTARY
INFORMATION section of this document.
Docket: All documents in the docket
are listed in the www.regulations.gov
index. Although listed in the index,
some information is not publicly
available, e.g., CBI or other information
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whose disclosure is restricted by statute.
Certain other material, such as
copyrighted material, will be publicly
available only in hard copy. Publicly
available docket materials are available
either electronically in www.regulations.
gov or in hard copy at the Air and
Radiation Docket and Information
Center, EPA/DC, EPA West, Room 3334,
1301 Constitution Avenue 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 Air and Radiation Docket and
Information Center is (202) 566–1742.
Public Hearing: One public hearing
will be held on this proposed rule. The
hearing will be held on March 20, 2012,
at the DoubleTree Hotel—Crystal City,
300 Army Navy Drive, Arlington,
Virginia 22202; phone number (703)
416–4100. The public hearing will
convene at 10 a.m. and continue until
7 p.m. (local time) or later, if necessary,
depending on the number of speakers
wishing to participate. The EPA will
make every effort to accommodate all
speakers that are registered and arrive
before 7 p.m. A lunch break is
scheduled from 1 p.m. until 2 p.m. and
a thirty minute break is scheduled from
4:30 p.m. until 5 p.m. during the
hearing. The EPA Web site for the
rulemaking, which includes the
proposal and information about the
public hearing, can be found at: www.
epa.gov/nsr.
FOR FURTHER INFORMATION CONTACT:
Michael S. Brooks, Air Quality Policy
Division, Office of Air Quality Planning
and Standards (C504–05),
Environmental Protection Agency,
Research Triangle Park, North Carolina
27711; telephone number (919) 541–
3539; fax number (919) 541–5509; email
address: brooks.michaels@epa.gov. The
public hearing will provide interested
parties the opportunity to present data,
views, or arguments concerning these
proposed rules. Persons interested in
presenting oral testimony should notify
Ms. Long at least 1 day in advance of the
public hearing. To register to speak,
attend or for information pertaining to
the public hearing on this document,
contact Ms. Pamela S. Long, Air Quality
Policy Division, Office of Air Quality
Planning and Standards (C504–01),
Environmental Protection Agency,
Research Triangle Park, North Carolina
27711; telephone number (919) 541–
0641; fax number (919) 541–5509; email
address: long.pam@epa.gov.
SUPPLEMENTARY INFORMATION: The
information in this SUPPLEMENTARY
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INFORMATION section of this preamble is
organized as follows:
I. General Information
A. Executive Summary
1. Purpose of the Regulatory Action
2. Summary of Major Provisions
B. Does this action apply to me?
C. Where can I get a copy of this document
and other related information?
D. What should I consider as I prepare my
comments for the EPA?
1. Submitting CBI
2. Tips for Preparing Your Comments
E. How can I find information about the
public hearing?
F. What acronyms, abbreviations and units
are used in this preamble?
II. Overview of the Proposed Rule
III. Background
A. Statutory and Regulatory Background
for PSD and Title V
B. How does the Tailoring Rule address
GHG emissions under PSD and Title V?
C. In the Tailoring Rule, what
commitments did the EPA make for Step
3?
D. In the Tailoring Rule, what plan did the
EPA announce for developing
streamlining measures?
E. In the Tailoring Rule, what
commitments did the EPA make for
subsequent action?
IV. Available Information on GHG Permitting
A. GHG Permitting Activity to Date
B. Consultations With States
C. Additional Technical Support for the
Step 3 Rule
V. Proposed Step 3 Rule
A. Overview
B. Have states had adequate time to ramp
up their resources?
C. What is the ability of permitting
authorities to issue timely permits?
D. Has the EPA developed streamlining
methods?
E. Limited Benefit From Lowering
Thresholds in Step 3
F. Conclusion
VI. Streamlining for PSD and Title V
Permitting of GHGs
A. Plantwide Applicability Limitations for
GHGs
1. What is the EPA proposing?
2. What is a PAL?
3. Why are we proposing to amend the
regulations?
4. Options for Allowing GHG-Only Sources
To Obtain a GHG PAL
5. Extending PALs to GHGs on a CO2e
Basis and Using PALs To Determine
Whether GHG Emissions Are ‘‘Subject to
Regulation’’
6. Can a GHG source that already has a
mass-based GHG PAL obtain a CO2ebased PAL once we issue final changes
to the PAL rules?
7. How would we change the regulatory
provisions to implement PALs for GHGonly major sources?
B. Synthetic Minor Source Permitting
Authority for GHGs
1. What is the EPA proposing?
2. What is synthetic minor limitation, and
what is its function?
3. What is a ‘‘subject to regulation’’
limitation?
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4. Why does the EPA need authority to
issue synthetic minor source permits?
5. What are the benefits to a federal GHG
synthetic minor permit program?
6. What is the legal rationale for EPA’s
GHG synthetic minor source permitting
authority?
7. What changes would EPA make to the
PSD regulations to allow EPA to issue
GHG synthetic minor permits?
C. Redefining Potential To Emit and Source
Category Specific PTE
D. General Permitting for GHGs
1. What is a general permit?
2. What is the legal authority for general
permits?
3. Have the states used general permits?
4. What steps has the EPA made toward
developing general permits?
5. General Permits and Title V
E. Presumptive BACT for GHGs
1. Definition of BACT
2. What is presumptive BACT?
3. How the EPA Could Consider
Implementing Presumptive BACT
4. Possible Impediments to Presumptive
BACT
F. Title V Empty Permits
VII. Request for Comment
A. Solicitation of Comment on Proposed
Step 3
1. General
2. Call for Additional Information
Concerning State Burdens
B. Solicitation of Comment on
Streamlining Techniques
1. Plantwide Applicability Limitations for
GHGs
2. Synthetic Minor Source Permitting
Authority for GHGs
3. Redefining PTE and Source Category
Specific PTE
4. General Permits for GHGs
5. Presumptive BACT for GHGs
VIII. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory
Planning and Review and Executive
Order 13563: Improving Regulation and
Regulatory 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 and
Advancement Act
J. Executive Order 12898: Federal Actions
To Address Environmental Justice in
Minority Populations and Low-Income
Populations
K. Determination Under Section 307(d)
IX. Statutory Authority
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I. General Information
A. Executive Summary
1. Purpose of the Regulatory Action
The purpose of this ‘‘Step 3’’ rule is
to continue the process of phasing in
GHG permitting requirements under the
PSD and title V programs begun in Steps
1 and 2 of the Tailoring Rule.1 As a
result of actions to regulate GHGs under
other Clean Air Act (CAA or ‘‘the Act’’)
programs, GHGs are required to be
addressed under the major source
permitting requirements of the Act’s
PSD and title V programs. The Tailoring
Rule is necessary because the statutory
definitions that have been used for other
air pollutants to determine which
sources are ‘‘major sources’’ subject to
permitting under these programs are
based on annual emission rates of 100
or 250 tpy which, if implemented
immediately for GHGs, would bring so
many sources into the programs as to
overwhelm the capabilities of state
permitting authorities to issue permits
and potentially impede the ability of
sources to construct or modify their
facilities.
To prevent this outcome, the EPA
promulgated the Tailoring Rule to create
a higher major source threshold for
GHGs. In the Tailoring Rule, we
explained that ‘‘[t]hese impacts * * *
are so severe that they bring the judicial
doctrines of ‘absurd results,’
‘administrative necessity,’ and ‘onestep-at-a-time’ into the Chevron twostep analytical framework for statutes
administered by agencies.’’ Tailoring
Rule, 75 FR at 31517. We further
explained that on the basis of this legal
interpretation, we would phase-in the
applicability of PSD and title V to GHGemitting sources so that those
requirements would apply ‘‘at least to
the largest sources initially, at least to as
many more sources as possible and as
promptly as possible over time * * *
and at least to a certain point.’’ Id. In the
Tailoring Rule, we went on to
promulgate the first two steps of the
phase-in program, which we call Steps
1 and 2, and we made commitments for
subsequent action.
Under Step 1 of the Tailoring Rule,
which began on January 2, 2011, sources
above the GHG threshold that are
required to obtain a PSD or title V
permit anyway due to emissions of
other pollutants (referred to as
‘‘anyway’’ sources) are required also to
address their GHG emissions in the
permit. Under Step 2, which became
effective on July 1, 2011, sources with
1 ‘‘Prevention of Significant Deterioration and
Title V Greenhouse Gas Tailoring Rule; Final Rule,’’
75 FR 31,514 (June 3, 2010) (the Tailoring Rule).
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GHG emissions above the Tailoring Rule
threshold also are required to obtain a
PSD or title V permit, even if they
would not be subject to these programs
based on emissions of other pollutants.
In the Tailoring Rule, the EPA also
committed to this Step 3 rulemaking.
For this rulemaking we have evaluated
whether it is now possible to lower the
GHG major source threshold to bring
additional sources into the CAA
permitting programs without
overwhelming state permitting
authorities. In addition, we have
continued our identification and
evaluation of potential approaches to
streamline permitting so as to enable
permitting authorities to permit more
GHG-emitting sources without undue
burden. The specific actions being
proposed today are briefly described in
the following paragraphs.
2. Summary of Major Provisions
The EPA is proposing to leave the
GHG major source thresholds
unchanged from the Step 2 level at this
time. We have found that the
capabilities of the state permitting
authorities have not improved to the
extent necessary for additional sources
to be brought into the system. This
proposal is discussed further in section
V of this preamble.
We are also proposing to revise the
PSD regulations to provide for GHG
PALs. A PAL establishes a site-specific
plantwide emission level for a pollutant
that allows the source to make changes
at the facility without a PSD permit,
provided that emissions to not exceed
the PAL level. Such PALs are already
available under PSD for other
pollutants, and we are proposing to
create provisions to allow for GHG PALs
as well. We believe that this action will
streamline PSD permitting programs by
allowing sources and permitting
authorities to address GHGs one time for
a source and avoid repeated subsequent
permitting actions. This action is
discussed further in section VI.A of this
preamble.
We are proposing regulatory
provisions as well to allow for
‘‘synthetic minor’’ permits for GHGs
under the federal PSD program.
Applicability under PSD and title V is
triggered when a source ‘‘emits, or has
the potential to emit’’ a pollutant at a
level greater than the major source
threshold. Under this system, there are
some sources that have the potential to
emit a pollutant above the threshold
(e.g., if the source were to operate 24
hours per day, 7 days per week), but do
not have actual emissions above the
threshold, due to physical or
operational limitations, and do not plan
to ever have emissions that great. The
EPA has long allowed for such sources
to voluntarily accept enforceable limits
on their emissions to keep them below
the major source threshold; such
sources are referred to as ‘‘synthetic
minor’’ sources. However, synthetic
minor permits are typically issued by
states under their minor source NSR
programs, and there is no generally
applicable federal minor NSR program.
To allow for issuance of synthetic minor
permits for GHGs in all areas subject to
the federal PSD program, we are
proposing to add GHG synthetic minor
provisions to the federal PSD program.
We believe that permitting synthetic
minor GHG sources under these
provisions will reduce the number of
sources subject to PSD and title V,
reducing the burden on state permitting
authorities and the sources. This action
is discussed further in section VI.B of
this preamble.
B. Does this action apply to me?
Entities affected by this action include
sources in all sectors of the economy,
including commercial and residential
sources. Entities potentially affected by
this action also include states, local
permitting authorities and tribal
authorities. The majority of categories
and entities potentially affected by this
action are expected to be in the
following groups:
Industry group
NAICS a
Agriculture, fishing, and hunting ...................................................................................
Mining ...........................................................................................................................
Utilities (electric, natural gas, other systems) ..............................................................
Manufacturing (food, beverages, tobacco, textiles, leather) ........................................
Wood product, paper manufacturing ............................................................................
Petroleum and coal products manufacturing ...............................................................
Chemical manufacturing ...............................................................................................
Rubber product manufacturing .....................................................................................
Miscellaneous chemical products ................................................................................
Nonmetallic mineral product manufacturing .................................................................
Primary and fabricated metal manufacturing ...............................................................
11
21
2211, 2212, 2213
311, 312, 313, 314, 315, 316
321, 322
32411, 32412, 32419
3251, 3252, 3253, 3254, 3255, 3256, 3259
3261, 3262
32552, 32592, 32591, 325182, 32551
3271, 3272, 3273, 3274, 3279
3311, 3312, 3313, 3314, 3315, 3321, 3322, 3323, 3324,
3325, 3326, 3327, 3328, 3329
3331, 3332, 3333, 3334, 3335, 3336, 3339
3341, 3342, 3343, 3344, 3345, 4446
3351, 3352, 3353, 3359
3361, 3362, 3363, 3364, 3365, 3366, 3366, 3369
3371, 3372, 3379
3391, 3399
5622, 5629
6221, 6231, 6232, 6233, 6239
8122, 8123
8141
Not available. Codes only exist for private households,
construction and leasing/sales industries.
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Machinery manufacturing .............................................................................................
Computer and electronic products manufacturing .......................................................
Electrical equipment, appliance, and component manufacturing ................................
Transportation equipment manufacturing ....................................................................
Furniture and related product manufacturing ...............................................................
Miscellaneous manufacturing .......................................................................................
Waste management and remediation ..........................................................................
Hospitals/Nursing and residential care facilities ..........................................................
Personal and laundry services .....................................................................................
Residential/private households ....................................................................................
Non-Residential (Commercial) .....................................................................................
a North
American Industry Classification System.
C. Where can I get a copy of this
document and other related
information?
In addition to being available in the
docket, an electronic copy of this
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proposed rule will also be available on
the World Wide Web. Following
signature by the EPA Administrator, a
copy of this proposed rule will be
posted in the regulations and standards
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section of our New Source Review
(NSR) Web site, under Regulations &
Standards, at https://www.epa.gov/nsr.
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D. What should I consider as I prepare
my comments for the EPA?
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1. Submitting CBI
Do not submit this information to the
EPA through www.regulations.gov or
email. Clearly mark the part or all of the
information that you claim to be CBI.
For CBI information in a disk or CD–
ROM that you mail to the EPA, mark the
outside of the disk or CD–ROM as CBI
and then identify electronically within
the disk or CD–ROM the specific
information that is claimed as CBI. In
addition to one complete version of the
comment that includes information
claimed as CBI, a copy of the comment
that does not contain the information
claimed as CBI must be submitted for
inclusion in the public docket.
Information so marked will not be
disclosed except in accordance with
procedures set forth in 40 CFR Part 2.
Send or deliver information identified
as CBI only to the following address:
Roberto Morales, OAQPS Document
Control Officer (C404–02),
Environmental Protection Agency,
Research Triangle Park, NC 27711,
Attention Docket ID No. EPA–HQ–
OAR–2009–0517.
2. Tips for Preparing Your Comments
When submitting comments,
remember to:
• Identify the rulemaking by docket
number and other identifying
information (subject heading, Federal
Register date and page number).
• Follow directions—The agency may
ask you to respond to specific questions
or organize comments by referencing a
Code of Federal Regulations (CFR) part
or section number.
• Explain why you agree or disagree;
suggest alternatives and substitute
language for your requested changes.
• Describe any assumptions and
provide any technical information
and/or data that you used.
• If you estimate potential costs or
burdens, explain how you arrived at
your estimate in sufficient detail to
allow for it to be reproduced.
• Provide specific examples to
illustrate your concerns, and suggest
alternatives.
• Explain your views as clearly as
possible, avoiding the use of profanity
or personal threats.
• Make sure to submit your
comments by the comment period
deadline identified.
E. How can I find information about the
public hearing?
Persons interested in presenting oral
testimony should contact Ms. Pamela
Long, Air Quality Policy Division
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(C504–01), Environmental Protection
Agency, Research Triangle Park, NC
27711; telephone number (919) 541–
0641 or email long.pam@epa.gov at least
1 day in advance of the public hearing.
Persons interested in attending the
public hearing should also contact Ms.
Long to verify the time, date and
location of the hearing. The public
hearing will provide interested parties
the opportunity to present data, views
or arguments concerning these proposed
rules.
14229
tailoring, the applicability thresholds at
which GHG emission sources are subject
to the CAA PSD and title V permitting
requirements. We also stated in that rule
that we would lower the Tailoring Rule
thresholds only after we determined
that the states have had enough time to
develop the necessary infrastructure and
increase their GHG permitting expertise
and capacity to efficiently manage the
expected increase in administrative
burden, and only after we had the
opportunity to expedite GHG permit
issuance through streamlining
F. What acronyms, abbreviations and
measures. In addition, in the Tailoring
units are used in this preamble?
Rule, we committed to complete action
The following acronyms,
on the Step 3 rulemaking by July 1,
abbreviations and units are used in this
2012, and to make the Step 3 rule
preamble:
effective on July 1, 2013. In the short
AFUE .. Annual Fuel Utilization Effi- period of time since the EPA
promulgated the Tailoring Rule, the
ciency
BACT .. Best Available Control Tech- states and we have made progress in
nology
GHG permitting capacity and
CAA or Clean Air Act
streamlining in some areas, but not
Act.
enough to justify lowering the
CFR ..... Code of Federal Regulations
thresholds at this time. As a result, in
CH4 ...... Methane
this rulemaking, we propose to maintain
CO2 ...... Carbon Dioxide
Step 3 of the Tailoring Rule at current
CO2e .... Carbon Dioxide Equivalent
levels.
DOE ..... U.S. Department of Energy
In section III of this proposal, we
EPA ..... U.S. Environmental Protection
Agency
discuss background information,
ECOS ... Environmental Council of the including the potential numbers of
States
permit actions, amounts of GHG
FIP ....... Federal Implementation Plan
emissions, and administrative costs of
FR ........ Federal Register
permit actions for the sources that are
GHG .... Greenhouse Gas
potentially subject to GHG permitting
GP ........ General Permit
for Step 3.
GWP .... Global Warming Potential
In section IV, we discuss the available
HFCs ... Hydrofluorocarbons
information regarding the impact that
ICR ...... Information Collection Request
LDVR ... Light-Duty Vehicle Rule
GHG permitting is having on permitting
N2O ..... Nitrous Oxide
authorities. In section V, we discuss our
NAAQS National Ambient Air Quality proposal to maintain the current
Standard
applicability requirements for GHG PSD
NACAA National Association of Clean Air
and title V permitting at the levels
Agencies
NRDC .. Natural Resources Defense Coun- established under Steps 1 and 2 of the
Tailoring Rule—which are the first two
cil
steps in the Tailoring Rule’s phase-in
NSR ..... New Source Review
NTTAA National Technology Transfer and program for PSD and title V
Advancement Act
applicability—which we generally refer
OMB .... Office of Management and Budget to as the 100,000/75,000 levels. Our
PAL ..... Plantwide Applicability Limita- basis for maintaining the current
tion
applicability requirements stems from
PFCs .... Perfluorocarbons
PSD ..... Prevention of Significant Deterio- the Tailoring Rule itself, in which we
determined that with the Step 1 and 2
ration
thresholds, permitting authorities would
PTE ...... Potential to Emit
be required to handle a large number of
RFA ..... Regulatory Flexibility Act
SBA ..... Small Business Administration
GHG permitting actions that would
SF6 ....... Sulfur Hexafluoride
impose significant administrative
SIP ....... State Implementation Plan
burdens on the permitting authorities,
SNPR ... Supplemental Notice of Proposed
and that lowering those thresholds in
Rulemaking
Step 3 would bring in more permitting
TSD ..... Technical Support Document
actions that in turn would add more
tpy ....... Tons Per Year
burden. Accordingly, we stated we
UMRA
Unfunded Mandates Reform Act
would lower the GHG thresholds only if
II. Overview of the Proposed Rule
certain criteria are met. The criteria are:
In the Tailoring Rule, we included an (i) The development of what we call
streamlining measures that would make
enforceable commitment to propose or
GHG permitting more efficient, (ii)
solicit comment on what we call Step 3
whether permitting authorities had the
of the process for phasing in, or
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time needed to ramp up their resources,
and (iii) the ability of sources to meet
the requirements of the PSD program
and the permitting authorities’ ability to
issue timely permits.2 Information
currently available indicates that the
permitting authorities are not
significantly better positioned now to
process more GHG permits than they
were at the time we promulgated Steps
1 and 2 in the Tailoring Rule. We also
note that lowering the thresholds to
include the relatively low-emitting
sources currently under consideration
for Step 3 would result in a very small
addition to the amount of GHG
emissions subject to permitting
requirements while potentially adding
thousands of sources to the permitting
process. For these reasons, we propose
in Step 3 to maintain, and not lower, the
current applicability thresholds.
As we committed to do in the
Tailoring Rule, we have been exploring
a variety of approaches that could be
used to streamline PSD and title V
permitting for sources of GHGs. In
section VI, we discuss streamlining
techniques with the potential to make
the PSD and title V permitting programs
more efficient to administer for GHGemitting sources, and propose two
streamlining techniques. In section
VI.A, we propose to add provisions to
the PSD regulations at 40 CFR 51.166
and 52.21 to better address PALs for
GHGs. More specifically, we propose
regulatory changes to implement GHG
PALs on either a mass-basis (tpy) or a
CO2e-basis, including for existing
sources that are not yet currently major
for any regulated NSR pollutants and
are not major sources because of their
GHG emissions, and we also propose
allowing PALs to be used as an
alternative approach for determining
both whether a project is a major
modification and whether GHG
emissions are subject to regulation. In
section VI.B, we propose to add
provisions to the PSD regulations at 40
CFR 52.21 to create GHG synthetic
minor source permitting authority, in
areas subject to a GHG PSD FIP. In
doing so, we propose changes to create
the regulatory authority for the EPA to
issue synthetic minor limitations for
GHG emissions to allow sources to
restrict emissions below the PSD
applicability thresholds. A synthetic
minor limit may also allow sources to
restrict emissions below the title V
permitting applicability threshold on a
source-wide basis. We also request
comment on whether any states with
approved SIPs lack authority to issue
GHG synthetic minor limitations.
2 75
FR 31559.
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In the rest of section VI, we discuss
our progress in evaluating the suitability
of other streamlining options and
request further comment, for the
purposes of both PSD and title V
permitting, on potential-to-emit
calculations and the use of general
permits; and for PSD permitting, on the
use of presumptive best available
control technology (BACT).
In section VII, we solicit comment on
the full range of topics discussed in this
proposal. In addition, we call for
additional information from states as to
their current and expected air permit
budgets as well as their current and
expected future levels of permitting
based on the current thresholds and the
possibility of lower thresholds in the
future.
III. Background
This section describes key aspects of
the background for this rulemaking. For
other background information, such as a
description of GHGs and their sources,
the regulatory backdrop to the Tailoring
Rule, and the EPA’s GHG PSD and title
V programs, see the Tailoring Rule, the
related actions that the EPA took shortly
before finalizing the Tailoring Rule,3
and the GHG PSD and title V
implementation rules that we call the
GHG PSD SIP Call and GHG FIP,4 as
3 ‘‘Endangerment and Cause or Contribute
Findings for Greenhouse Gases Under Section
202(a) of the Clean Air Act,’’ 74 FR 66,496
(December 15, 2009) (the Endangerment and Causeor-Contribute Findings); ‘‘Light-Duty Vehicle
Greenhouse Gas Emission Standards and Corporate
Average Fuel Economy Standards; Final Rule,’’ 75
FR 25,324 (May 7, 2010) (the Light-duty Vehicle
Rule); ‘‘Interpretation of Regulations that Determine
Pollutants Covered by Clean Air Act Permitting
Programs,’’ 75 FR 17,004 (April 2, 2010) (the
Timing Decision or the Johnson Memo
Reconsideration). In the ‘‘Endangerment Finding,’’
which is governed by CAA section 202(a) in
December 2009 the Administrator exercised her
judgment to conclude that ‘‘six greenhouse gases
taken in combination endanger both the public
health and the public welfare of current and future
generations.’’ The Administrator also found ‘‘that
the combined emissions of these greenhouse gases
from new motor vehicles and new motor vehicle
engines contribute to the greenhouse gas air
pollution that endangers public health and welfare
under CAA section 202(a).’’ 74 FR 66496. This
Endangerment Finding led directly to promulgation
of what we call the ‘‘Light-duty Vehicle Rule’’ or
the ‘‘LDVR,’’ also governed by CAA section 202(a),
in which EPA set standards for the emission of
greenhouse gases for new motor vehicles built for
model years 2012–2016. The Johnson Memo
Reconsideration provided EPA’s interpretation of a
pre-existing definition in its PSD regulations
delineating the ‘‘pollutants’’ that are taken into
account in determining whether a source must
obtain a PSD permit and the pollutants each permit
must control. Regarding the Vehicle Rule, the
Johnson Memo Reconsideration stated that such
regulations, when they take effect on January 2,
2011, will, by operation of the applicable CAA
requirements, subject GHG-emitting sources to PSD
requirements.
4 ‘‘Action to Ensure Authority to Issue Permits
under the Prevention of Significant Deterioration
PO 00000
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well as the GHG PSD and title V
Narrowing Rules.5 For purposes of this
proposal, we assume that the reader is
familiar with the above-referenced
materials. In the following paragraphs
we provide a brief summary of key
statutory and regulatory background for
the PSD permit and title V programs.
A. Statutory and Regulatory Background
for PSD and Title V
Under the CAA, new major stationary
sources of certain air pollutants, defined
as ‘‘regulated NSR pollutants,’’ and
major modifications to existing major
sources are required to, among other
things, obtain a PSD permit prior to
construction or major modification. We
refer to the set of requirements that
determine which sources and
modifications are subject to PSD as the
‘‘applicability’’ requirements. Once
major sources become subject to PSD,
these sources must, in order to obtain a
PSD permit, meet the various PSD
requirements. For example, they must
apply BACT, demonstrate compliance
with air quality related values and PSD
increments, address impacts on special
Class I areas (e.g., some national parks
and wilderness areas), and assess
impacts on soils, vegetation, and
visibility. These PSD requirements are
the subject of Sections III and IV of this
document.
In this section, we discuss how the
CAA and relevant EPA regulations
describe the PSD applicability
requirements. The CAA applies the PSD
requirements to any ‘‘major emitting
facility’’ that constructs (if the facility is
new) or undertakes a modification (if
the facility is an existing source).6 The
term ‘‘major emitting facility’’ is defined
as a stationary source that emits, or has
a PTE of, at least 100 TPY, if the source
is in one of 28 listed source categories,
or, if the source is not, then at least 250
TPY, of ‘‘any air pollutant.’’ 42 U.S.C.
7479(1). For existing facilities, the CAA
adds a definition of modification,
which, in general, is any physical or
Program to Sources of Greenhouse Gas Emissions:
Finding of Substantial Inadequacy and SIP Call—
Final Rule,’’ 75 FR 77,698 (December 13, 2010) (the
GHG PSD SIP Call); ‘‘Action to Ensure Authority to
Issue Permits Under the Prevention of Significant
Deterioration Program to Sources of Greenhouse
Gas Emissions: Federal Implementation Plan; Final
Rule,’’ 75 FR 82246 (December 30, 2010) (the GHG
PSD SIP Call FIP).
5 ‘‘Limitation of Approval of Prevention of
Significant Deterioration Provisions Concerning
Greenhouse Gas Emitting Sources in State
Implementation Plans; Final Rule,’’ 75 FR 82535
(December 30, 2010) (the PSD Narrowing Rule);
‘‘Action to Ensure Authority to Implement Title V
Permitting Programs Under the Greenhouse Gas
Tailoring Rule; Final Rule,’’ 75 FR 82254 (December
30, 2010) (the Title V Narrowing Rule).
6 42 U.S.C. 7475(a), 7479(1).
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operational change that ‘‘increases the
amount’’ of any air pollutant emitted by
the source.7
The EPA’s regulations implement
these PSD applicability requirements
through use of different terminology,
and, in the case of GHGs, with
additional limitations. Specifically, the
regulations apply the PSD requirements
to any major stationary source that
begins actual construction 8 (if the
source is new) or that undertakes a
major modification (if the source is
existing).9 The term major stationary
source is defined as a stationary source
that emits, or has a PTE of, at least 100
TPY if the source is in one of 28 listed
source categories, or, if the source is not,
then at least 250 TPY, of regulated NSR
pollutants.10 We refer to these 100- or
250-TPY amounts as the major source
limits or thresholds. A major
modification is defined as ‘‘any physical
change in or change in the method of
operation of a major stationary source
that would result in: a significant
emissions increase [ ] of a regulated NSR
pollutant [ ]; and a significant net
emissions increase of that pollutant
from the major stationary source.’’ 11
EPA rules specify what amount of
emissions increase is ‘‘significant’’ for
listed regulated NSR pollutants (e.g., 40
TPY for sulfur dioxide, 100 TPY for
carbon monoxide), but for any regulated
NSR pollutant that is not listed in the
regulations, any increase is
significant.12
A pollutant is a ‘‘regulated NSR
pollutant’’ if it meets at least one of four
requirements, which are, in general, any
pollutant for which EPA has
promulgated a NAAQS or a new source
performance standard (NSPS), certain
ozone depleting substances, and ‘‘[a]ny
pollutant that otherwise is subject to
regulation under the Act.’’ 13 PSD
applies on a regulated-NSR-pollutantby-regulated-NSR-pollutant basis. The
PSD requirements do not apply to
regulated NSR pollutants for which the
area is designated as nonattainment.
Further, some modifications are exempt
from PSD review (e.g., routine
maintenance, repair and replacement).14
Under the CAA, title V applies to a
‘‘major source,’’ which is defined to
include any stationary source that is a
‘‘major stationary source’’ under section
7 42
U.S.C. 7479(1), 7411(a)(4).
CFR 52.21(b)(11).
9 40 CFR 52.21(a)(2).
10 40 CFR 52.21(b)(1)(i).
11 40 CFR 52.21(b)(2)(i) and the term ‘‘net
emissions increase’’ as defined at 40 CFR
52.21(b)(3).
12 40 CFR 52.21(b)(23)(i)–(ii).
13 40 CFR 52.21(b)(50).
14 40 CFR 52.21(b)(2)(iii).
8 40
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302 of the Act.15 CAA § 501(2). Under
section 302, a ‘‘major stationary source’’
is defined as any stationary facility or
source of air pollutants which directly
emits, or has the potential to emit, 100
tpy or more of any air pollutant.16 The
title V regulations define a ‘‘major
source’’ in 40 CFR 70.2.
In the Tailoring Rule, the EPA
promulgated, for the first time, a
regulatory definition of the term
‘‘subject to regulation’’ for purposes of
the PSD regulations, and included that
term, as defined, in the title V
regulations. Under the Tailoring Rule
regulations, a pollutant is ‘‘subject to
regulation’’ if, in general, the pollutant
is subject to actual control of the
quantity of emissions (as opposed to, for
example, being subject only to
monitoring requirements). E.g., 40 CFR
51.166(b)(48), 40 CFR 70.2. In addition,
the Tailoring Rule also provides a
special rule for GHGs, which provides
that GHGs become pollutants ‘‘subject to
regulation,’’ and therefore subject to
PSD and title V, if they meet the
following two-step phase-in thresholds.
Step 1 applies the applicable
requirements of PSD, including the
BACT requirement to projects that
increase net GHG emissions by the
applicable threshold (75,000 tpy CO2e)
provided these projects would be
subject to PSD anyway by significantly
increasing emissions of at least one nonGHG pollutant. Under Step 1, for the
title V program, only sources with
current title V permits for non-GHG
pollutants will have to address GHGs.
Step 2 then expands the program by
phasing in additional large sources of
GHG emissions that are not already
subject to PSD or title V permitting
requirements due to non-GHG
emissions. In Step 2, PSD and title V
requirements will apply to new sources
that emit, or have the potential to emit,
at least 100,000 tpy CO2e. For existing
sources, Step 2 applies title V
requirements to existing sources that
emit, or have the potential to emit,
100,000 tpy CO2e and that are not
already subject to title V requirements,
and also applies PSD requirements to
those sources that emit, or have the
potential to emit, 100,000 tpy CO2e and
undertake a modification that increases
net emissions by at least 75,000 tpy
CO2e. See 75 FR 31516.
In the Tailoring Rule, the EPA
explained that ‘‘we selected the ‘subject
to regulation’ mechanism’’ as the legal
mechanism for establishing the phase-in
thresholds because we had received
information that states could more
15 CAA
16 CAA
PO 00000
§ 501(2).
§ 302(j).
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expeditiously adopt those thresholds
through that mechanism. The EPA
added that ‘‘our action in this
rulemaking [in establishing the phase-in
thresholds] should be interpreted to rely
on any of several legal mechanisms to
accomplish this result * * * [including]
revising the meaning of several terms in
the [PSD] definition [ provisions].’’ 75
FR 31582. In this manner, EPA
identified several legal bases within the
definitional previsions of the PSD
regulations to support the phase-in
approach.
B. How does the Tailoring Rule address
GHG emissions under PSD and Title
V? 17
In the Tailoring Rule, the EPA
explained that the rulemaking was
necessary because without it, the CAA
PSD preconstruction review permitting
program and the title V operating permit
program would, under a literal reading
of those provisions, apply to all
stationary sources that emit or have the
potential to emit more than 100 or 250
tpy of GHGs beginning on January 2,
2011. This was the date when the EPA’s
recently promulgated Light Duty
Vehicle Rule (LDVR) took effect,
imposing control requirements for the
first time on carbon dioxide (CO2) and
other GHGs, thereby making them
subject to regulation and triggering the
PSD and title V permitting
requirements. Therefore, a source owner
proposing to construct any new major
source that would emit or have the
potential to emit at or higher than the
100/250 tpy applicability levels (and
which therefore may be referred to as a
‘‘major’’ source) or modify any existing
major source in a way that would
increase GHG emissions, would need to
obtain a permit under the PSD program
that addresses these emissions before
construction or modification could
begin. Similarly, title V would apply to
a new or existing GHG source exceeding
the 100 tpy applicability threshold in
the Act.
In the Tailoring Rule, we further
explained that under these
circumstances, and in the absence of
streamlining methods, state and local
permitting authorities would be
burdened by the need to issue PSD
permits to tens of thousands of small
sources (including, for example, many
commercial sources and small industrial
sources) and to issue title V permits to
millions of small sources (including, for
example, many residential sources).
17 We include this discussion of the Tailoring
Rule for background purposes only. We do not
reopen for comment any of the determinations
made in the Tailoring Rule or our rationale for
them.
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These extraordinary numbers of permit
applications are orders of magnitude
greater than the current inventory of
annual applications and would vastly
exceed the current administrative
resources of the permitting authorities.
Permit gridlock would result with the
permitting authorities able to issue only
a tiny fraction of the permits requested.
In the Tailoring Rule, we further
explained that ‘‘[t]hese impacts * * *
are so severe that they bring the judicial
doctrines of ‘absurd results,’
‘administrative necessity,’ and ‘onestep-at-a-time’ into the Chevron twostep analytical framework for statutes
administered by agencies.’’ Tailoring
Rule, 75 FR at 31517. We further
explained that on the basis of this legal
interpretation, we would phase-in the
applicability of PSD and title V to GHGemitting sources so that those
requirements would apply ‘‘at least to
the largest sources initially, at least to as
many more sources as possible and as
promptly as possible over time * * *
and at least to a certain point.’’ Id. In the
Tailoring Rule, we went on to
promulgate the first two steps of the
phase-in program, which we call Steps
1 and 2, and we made commitments for
subsequent action.
In the Tailoring Rule, we closely
reviewed the numbers of additional
permitting actions for GHG-emitting
sources, and the resulting
administrative burdens, that would
occur at various permitting thresholds.
For example, we estimated the
following permitting burdens associated
with the Step 1 and Step 2 thresholds,
compared to the administrative burdens
of the then-current PSD and title V
programs (that is, before applicability to
GHG-emitting sources):
Step 1:
Number of sources subject to PSD and
title V permitting: The same as prior
to Step 1
Additional workload hours PSD
program: 34,000 at a cost of $3
million
Additional workload hours title V
program: 27,468 at a cost of $1
million
Step 2:
Number of additional sources subject
to PSD permitting: 2 new sources,
915 modified sources
Additional workload hours PSD
program: 310,655 at a cost of $24
million
Number of additional sources subject
to title V permitting: 190 sources for
each of the first 3 years
Additional workload hours title V
program: 141,322 at a cost of $7
million
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75 FR 31541.
We further estimated that the
combined additional PSD and title V
permitting burdens after
implementation of Steps 1 and 2 would,
on an annual basis, mean a 42 percent
increase in costs over the then-current
PSD and title V program. 75 FR 31540,
Table V–1.
C. In the Tailoring Rule, what
commitments did the EPA make for
Step 3?
In the Tailoring Rule, we noted that
‘‘following implementation of the first
phase of PSD and title V applicability to
GHG sources, generally at the
[proposed] threshold, additional action
would be required over time to assure
full compliance with the statute.’’ 75 FR
31571. Accordingly, we included in the
Tailoring Rule an enforceable
commitment to issue a notice of
proposed rulemaking in which we
would propose or solicit comment on a
third step of the phase-in, which we call
Step 3. We committed to complete Step
3 by July 1, 2012, and to make Step 3
effective by July 1, 2013. We committed
to solicit comment on lowering the
thresholds, so that more sources would
be subject to PSD and title V
requirements, 40 CFR 52.22(b)(1), 40
CFR 70.12(b)(1), but we did not commit
to either propose or finalize lower
thresholds. We further stated that in
light of the administrative burdens, we
would not, in Step 3, lower the
thresholds below the 50,000/50,000 tpy
CO2e levels.
In the Tailoring Rule, we recognized
that lowering the thresholds in Step 3,
and thereby bringing more sources into
PSD and title V permitting, would mean
that the permitting authorities would
confront even greater administrative
burdens. For example, we estimated that
lowering the thresholds to the 50,000/
50,000 level would increase
administrative costs by 40 percent above
administrative costs associated with
Step 2.18 Accordingly, we explained
that whether we could lower the
thresholds in Step 3 depended on (i)
whether the EPA could develop
streamlining measures, (ii) the time that
permitting authorities need to ramp up
their resources, and (iii) sources’
abilities to meet the requirements of the
PSD program and permitting authorities’
ability to issue timely permits. 75 FR
31524. We elaborated:
(2) Criteria for Establishing Phase-in
Schedule
The specific phase-in schedule under the
tailoring approach will depend on several
things. The first is our progress in developing
18 75
PO 00000
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streamlining methods that will render the
permitting authority workload more
manageable by taking some sources off the
table (through regulations or guidance
interpreting ‘‘potential to emit’’), and by
allowing for more efficient permit processing
(through general permits and presumptive
BACT). At the same time, streamlining
techniques will lower permitting costs to
sources or even eliminate some sources’
obligations to obtain permits altogether. The
second is the time that permitting authorities
need to ramp up their resources in an orderly
and efficient manner to manage the
additional workload. The third is information
we have as to the sources’ abilities to meet
the requirements of the PSD program and the
permitting authorities’ ability to process
permits in a timely fashion. That information
will be based on the real-world experience
the permitting authorities will accumulate as
they proceed to process permit application
for the larger GHG sources.
Thus, under our present approach, we will
develop streamlining techniques, we expect
the permitting authorities to ramp up
resources in response to the additional
demands placed upon them in the first two
steps, and we will gather real worldinformation about the GHG permitting
process; and based on all that, we will
address expanding the PSD program in a
step-by-step fashion to include more sources
over time. We intend to follow this process
to establish * * * the PSD applicability
thresholds * * *.
75 FR 31559. With respect to the third
criterion, we note that in the Tailoring
Rule, we made clear that sources’
abilities to meet the requirements of the
PSD and title V programs depend at
least in part on the ability of the states
to develop, as part of the state programs,
outreach and educational efforts to
facilitate source compliance.
Accordingly, for present purposes, we
think this component concerning
sources may be examined by a review of
the states’ progress in developing state
GHG permitting programs. We also note
that permitting authorities’ abilities to
issue timely GHG permits may be
measured by the extent of any
permitting backlog, and depend in large
part on the permitting authorities’
development of expertise. In this
rulemaking, we seek information from
the states as to their ability to issue
timely permits, including data
concerning their backlog, but we also
are examining, more broadly, the states’
progress in developing expertise in GHG
permitting.
D. In the Tailoring Rule, what plan did
the EPA announce for developing
streamlining measures?
In the Tailoring Rule, we announced
a plan to explore streamlining
techniques that could make the
permitting programs more efficient to
administer for GHGs, and that therefore
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could allow expanding those programs
to smaller sources. Streamlining
techniques to be evaluated include:
(1) Defining PTE for various source
categories, (2) establishing source
category emission limits for
presumptive BACT, (3) establishing
general permits and permits-by-rule, (4)
establishing a process for electronic
permitting, and (5) establishing a
process for lean techniques for more
efficient permitting processes. We
believe that these techniques have the
potential to streamline the PSD and title
V permitting programs for GHGs to
‘‘allow the expeditious expansion of
PSD and title V applicability to more
GHG-emitting sources while protecting
those sources and the permitting
authorities from undue expenses.’’ 75
FR 31526.
While we intend to move forward and
develop streamlining approaches, we
also stated in the Tailoring Rule that we
did not expect to develop and
implement any of these prior to Step 2.
We also stated in the rule that several
of these streamlining approaches will
take several years to develop, requiring
separate rulemaking both at the federal
level, and then through state and local
processes. We, nonetheless, committed
to explore a number of possible
streamlining actions prior to the Step 3
rulemaking.
In addition, with respect to title V, in
the Tailoring Rule we noted that
commenters on the proposal for that
rule stated that the EPA should apply
the title V program only to sources that
are subject to applicable requirements,
so that sources should not be required
to hold ‘‘empty permits’’ (e.g., permits
issued to a source that is not subject to
any applicable requirement for any
pollutant). In the Tailoring Rule, we
recognized that not requiring sources to
hold such ‘‘empty permits’’ is a
potential means for relieving title V
permitting burdens. [75 FR 31566.] We
also stated that—
We need to gather more information
concerning the potential number and utility
of ‘‘empty permits’’ for GHG sources, in light
of the fact that the need for requirements in
title V permits will vary based on the
requirements of each SIP, and the fact that
some SIPs contain broadly applicable
requirements.
75 FR 31566. We added that in the Step
3 rulemaking, ‘‘we may consider
whether to limit title V applicability to
GHG sources in order to minimize the
number of GHG sources with ‘empty’
permits.’’ Tailoring Rule, 75 FR 31567.
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E. In the Tailoring Rule, what
commitments did the EPA make for
subsequent action?
In addition, in the Tailoring Rule, we
established an enforceable commitment
that we will (i) complete a study by
April 30, 2015, to evaluate the status of
PSD and title V permitting for GHGemitting sources, including progress in
developing streamlining techniques;
and (ii) complete further rulemaking
(which we refer to as Step 4), based on
that study by April 30, 2016, to address
the permitting of smaller sources. That
rulemaking may also consider
additional permanent exclusions based
on the ‘‘absurd results’’ doctrine, where
applicable.
In the Tailoring Rule, we also
included a provision assuring that no
source with emissions or potential to
emit below 50,000 tpy CO2e, and no
modification resulting in an increase
and a net GHG increases of less than
50,000 tpy CO2e, would be subject to
PSD or title V permitting before April
30, 2016. We included this provision on
the basis of our conclusion that the
administrative burdens that would
accompany permitting sources below
the 50,000 tpy threshold would be so
great that it would be impossible to
administer the permit programs for
these sources until at least 2016, even
with the streamlining actions that the
EPA may be able to develop, and the
increases in permitting resources that
we reasonably expect the permitting
authorities to acquire.
IV. Available Information on GHG
Permitting
To support this Step 3 rulemaking,
the EPA has gathered additional
information on the impact that GHG
permitting is having on permitting
authorities at the current threshold
levels and the potential impact that
would result from a reduction in the
GHG permitting thresholds to levels as
low as 50,000 tpy CO2e. Section IV.A
discusses the actual permitting that has
occurred since January 1, 2011. Section
IV.B discusses information gathered
through preliminary consultations with
eight state PSD permitting authorities,
as well as, experience garnered from the
EPA regional offices that are the PSD
permitting authorities for certain
states.19 Section IV.C presents
information from an analysis of the
number of existing and new sources that
would be potentially major sources of
19 In the title V program, the responsible
permitting agency is referred to as the ‘‘permitting
authority,’’ while in the PSD program, this entity is
referred to as the ‘‘reviewing authority.’’ We use the
two terms interchangeably in this preamble.
PO 00000
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14233
GHGs at a range of thresholds between
the current level of 100,000 tpy CO2e
and 50,000 tpy CO2e.
A. GHG Permitting Activity to Date
As of December 1, 2011, the EPA and
state permitting authorities had issued
18 PSD permits with GHG requirements.
We also estimate that as of that date, the
EPA and state permitting authorities
had received an additional 50 GHG PSD
permit applications. The types of source
categories for which permitting
authorities have issued GHG permits
include: biofuel production, cement
plants, electric generating units, lime
production facilities, outer continental
shelf exploration, pulp and paper mills,
and refineries. Eleven states and three
EPA regions issued these permits. In
most cases, no permitting authority
issued a permit for the same source
category more than once. We discuss in
section V the extent to which these
permitting actions have provided
information relevant to Step 3.
B. Consultations With States
To obtain additional information on
the current status of GHG permitting
based on the implementation of Step 1
and Step 2 and the potential impact of
reducing the GHG thresholds in Step 3,
we consulted with eight state permitting
authorities—Iowa, Louisiana, Michigan,
New Jersey, North Carolina,
Pennsylvania, South Dakota and Utah—
all of which have experience with GHG
permitting, and which represent a crosssection of state programs geographically
and in terms of population and types of
sources. In addition, we reviewed the
experience of the EPA regional offices
that act as PSD permitting authorities in
state jurisdictions: Region 4, which
issues PSD permits for GHG emissions
in Florida and for all regulated pollutant
emissions from outer continental shelf
sources in the eastern portion of the
Gulf of Mexico; Region 6, which issues
PSD permits for GHG emissions in
Arkansas and Texas; and Region 9,
which issues PSD permits for all
regulated pollutants in many of the local
air quality management districts in
California. For additional information
concerning responses to the survey,
please refer to the Docket ID No. EPA–
HQ–OAR–2009–0517.
These states and regional offices
confirm that they have not yet
experienced the increase in the number
of major source permitting actions that
was predicted to result from the
implementation of Step 1 and Step 2.
They generally do not believe that 2011
has been representative of the
permitting burdens that they expect will
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ultimately occur under the current
Tailoring Rule.
In addition, the states confirmed that
to this point, they have not been able to
build up their GHG permitting
infrastructure. For example the
permitting activity to date has provided
limited, if any, opportunity to build
internal capacity to handle GHG
permitting for a diverse set of sources or
more efficiency for any particular source
category. Similarly, the lack of
permitting experience greatly
diminished the opportunity to develop
meaningful streamlining approaches to
address GHG permitting. As a result,
states indicated that they have made
little or no progress in implementing
streamlining measures, and have not
adopted any such measures specifically
to address GHGs.
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C. Additional Technical Support for the
Step 3 Rule
To support the decision-making
process for this Step 3 rule, the EPA
carried out an analysis to estimate the
number of facilities that would exceed
different GHG emissions threshold
levels.20 This analysis built upon
analysis the EPA included in the
Tailoring Rule to support the threshold
decisions in that action.21 In the
Tailoring Rule analysis, the EPA
evaluated eight different PTE thresholds
between 100 and 100,000 tpy CO2e,
including 50,000 tons per year. For this
Step 3 analysis, the EPA evaluated nine
additional thresholds between 50,000
and 100,000 tpy CO2e in 5,000 tpy
increments (that is, 55,000 through
95,000 tpy CO2e). The EPA considered
stationary sources in the following
sectors:
• Electricity Generation (facilities
with fossil fuel-fired electric generating
units);
• Industrial sources (14 subcategories
of industries with process and
combustion GHG emissions);
• Energy (oil and gas extraction,
transport, and processing; underground
coal mining);
• Waste Treatment (landfills and
municipal solid waste incinerators);
• Agriculture (stationary fuel
combustion);
• Commercial (stationary fuel
combustion); and
• Residential (stationary fuel
combustion).
20 See Technical Support Document ‘‘Summary of
Methodology and Data Used to Evaluate Resource
Requirements at Alternative Greenhouse Gas (GHG)
Permitting Thresholds’’ (December 2011).
21 See ‘‘Technical Support Document for
Greenhouse Gas Emissions Thresholds Evaluation,’’
March 29, 2010, Docket No. EPA–HQ–OAR–2009–
0517–19158.
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For each sector, the analysis estimated
the number of sources that would
become major sources for GHGs at each
of the different threshold levels and the
number of new major sources projected
to be added each year. The study found
that at a Step 3 major source threshold
of 50,000 tpy CO2e, approximately 4,650
additional sources would become major
sources of GHGs (increasing from 5,326
at 100,000 tpy CO2e, to 9,980 at 50,000
tpy). About half of these would be in the
‘‘unspecified industrial stationary
combustion’’ subcategory of industrial
facilities; 16 percent in the waste
treatment sector, landfill subcategory;
14 percent in the energy sector, oil and
gas subcategory; 12 percent in the
commercial/stationary fuel combustion
sector; 4 percent in the electricity
generation sector and the remaining 4
percent scattered among the remaining
sectors and industrial subcategories. At
a threshold of 80,000 tpy CO2e the
number of commercial sources that
become major sources of GHGs
significantly increases (compared to
100,000 tpy CO2e) and at a threshold of
55,000 tpy CO2e, some multi-family
residential sources become major
sources. The analysis found that no
sources in the agricultural or single
family residential categories would
become major sources of GHGs at a
threshold of 50,000 tpy CO2e. Note that
this analysis did not differentiate
between sources that become major only
because of the source’s GHGs emissions
from sources that are already major for
one or more other pollutants.
The EPA’s analysis identified sources
that would become subject to permitting
requirements because of GHG emissions
alone.22 Based on this analysis, we
estimate that a reduction from the
current Step 2 threshold to 50,000 tpy
CO2e would result in nearly 3,000
sources becoming major sources due to
their GHG emissions alone (increasing
from 552 sources at 100,000 tpy CO2e,
to 3,539 at 50,000 tpy). In addition, we
estimate that 1,014 additional
modifications would be subject to PSD
permitting based on GHG emissions at
50,000/50,000 tpy CO2e versus the Step
2 thresholds of 100,000/75,000
(increasing from 917 per year to 1,931).
In addition to determining the amount
of potential additional permit actions
associated with the various thresholds,
the EPA also determined the
administrative burdens associated with
those actions. To do so, the EPA relied
on the same per-permit administrative
22 See ‘‘Summary of Methodology and Data Used
to Evaluate Resource Requirements at Alternative
Greenhouse Gas (GHG) Permitting Thresholds,’’
December 2011.
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cost figures used in the Tailoring Rule
for both PSD and title V permitting, for
both commercial/residential sources
and industrial sources, as well as for
both new construction and
modifications.23 The EPA also
determined the amount of GHG
stationary source emissions associated
with the sources potentially affected by
the various thresholds.
To determine the impacts of lowering
the thresholds in Step 3, the EPA
compared the amounts of administrative
costs and GHG inventory covered at the
various cut-points to the amounts at the
100,000/75,000 Step 2 levels.24 For
example, with respect to the PSD
administrative costs, as we stated in the
Tailoring Rule, 75 FR 31540 (Table V–
1), at the 100,000/75,000 Step 2 levels,
we expect annual PSD permitting
actions for GHG-emitting sources to
include 242 newly constructed sources
and 1,365 modifications (917 for GHG
emissions alone plus 448 for anyway
sources) and we expect that these PSD
GHG permitting actions would increase
permitting authority administrative
burdens by 42 percent above existing
total air permitting burdens (including
permitting for conventional (i.e., nonGHG pollutants under Tailoring Rule
Step 1), because these actions would
trigger permitting requirements for both
PSD and title V. In total, we estimate the
facilities meeting the Step 2 major
source applicability thresholds account
for approximately 67 percent of the total
national stationary source GHG
emissions. At the 50,000/50,000 levels,
the EPA estimates annual PSD
permitting actions involving GHGemitting sources to include 243 newly
constructed sources and 2,379
modifications (1 more newly
constructed source and 1,014 more
modifications than at the 100,000/
75,000 level). While the EPA estimates
these GHG permitting actions to
increase permitting authority
administrative burdens by 40 percent
above the total burdens at Step 2 levels
(and 99% above the administrative
burdens without GHG permitting), we
estimate the facilities meeting these
major source applicability thresholds to
account for approximately 70 percent of
23 We note that none of the challenges to the
Tailoring Rule have addressed these burden
estimates; we have not revisited them for purposes
of this rule, nor are we are re-opening them for
comment.
24 This level refers to new sources as well as
existing sources that are not ‘‘anyway’’ sources and
that emit, or have the potential to emit, at least
100,000 tpy CO2e, as well as existing sources that
emit or have the potential to emit at least 100,000
tpy CO2e and that undertake a modification that
increases net emissions of GHGs by at least 75,000
tpy CO2e.
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total national stationary source GHG
emissions, just three percent more than
currently covered under Step 2. For a
more complete description of the EPA’s
analysis and an explanation, see the
Technical Support Document titled,
‘‘Summary of Methodology and Data
Used to Evaluate Resource
Requirements at Alternative Greenhouse
Gas (GHG) Permitting Thresholds’’
(December 2011).
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V. Proposed Step 3 Rule
A. Overview
The Tailoring Rule’s phase-in
approach is based on data concerning
the numbers of GHG permitting actions
the permitting authorities would have to
undertake and the costs of those
actions—both absolute and in
comparison to their current budgets—at
various different thresholds for the
applicability of PSD and title V to GHGemitting sources. In the Tailoring Rule,
we began the phase-in by establishing
Steps 1 and 2, which applied PSD and
title V to ‘‘anyway’’ sources 25 and
sources emitting GHGs at the 100,000/
75,000 tpy CO2e level. To do so, we
determined that permitting authorities
could handle the hundreds of additional
permitting actions that would occur
under Steps 1 and 2, even though the
authorities’ administrative costs would
increase by 42 percent over their thencurrent administrative costs for both
PSD and title V programs.
The present rulemaking represents the
fulfillment of our commitment in the
Tailoring Rule to undertake Step 3 of
the GHG PSD and title V phase-in
process. At this time, because of the
limited amount of new construction and
modifications that sources have
undertaken in the past year, we believe
state permitting authorities have not had
sufficient time and opportunity to
develop the necessary infrastructure and
increase their GHG permitting expertise
and capacity, which makes it
administratively infeasible to apply PSD
and title V permitting requirements to
additional sources. Accordingly, we are
proposing to leave the applicability
thresholds for GHGs unchanged.
In the Tailoring Rule, we committed
to undertake future rulemaking,
including this Step 3 rulemaking, to
examine whether we could lower the
thresholds to, potentially, as low as
25 We refer to these sources as ‘‘anyway’’ sources
because they will become subject to PSD for their
GHG emissions if they undergo PSD permitting
anyway, either for new construction or for
modification projects, based on emissions of nonGHG pollutants; and, by the same token, the will
become subject to title V for their GHG emissions
if they are subject to title V anyway due to their
non-GHG emissions.
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50,000/50,000, and thereby apply PSD
and title V to more sources. We
recognized that lowering the thresholds
would add more administrative costs on
top of those added by Steps 1 and 2, and
as a result, we stated that whether and
when we would lower the thresholds
would depend on the pace at which the
EPA and permitting authorities could
develop streamlining measures to
expedite permit program administration
and permitting authorities could hire
and train staff, as well as gain
experience with GHG permitting.
Specifically, we indicated that further
phase-in of GHG applicability would
depend on three criteria: (i) Whether the
EPA could develop streamlining
measures, (ii) the time that permitting
authorities need to ramp up their
resources, and (iii) sources’ abilities to
meet the requirements of the PSD
program and permitting authorities’
abilities to issue timely permits.
As described in the following, the
states and the EPA have made some
progress in these areas. For example, the
states have issued some GHG permits
and we are proposing streamlining
measures in this rulemaking. However,
neither the states nor the EPA have had
the opportunity to make significant
progress in these areas. First, the states
have had only limited experience in
GHG permitting and therefore have not
had the opportunity to develop
significant expertise. The main reasons
for this are the unexpectedly low
number of PSD permit applications
submitted to date and the short amount
of time since GHG permitting began. As
the volume of PSD permit applications
increases, EPA expects that more
permitting authorities will further
develop the necessary specialized
expertise required for case-by-case
review of GHG permit applications,
including the establishment of a robust
GHG BACT record. Second, the states
have not been able to develop their GHG
permitting infrastructure—e.g., hiring
additional personnel, establishing
policies and conducting outreach
programs to sources unfamiliar with the
permitting process—largely because
their permitting resources have not
increased and, in fact, in some cases
have decreased and may decrease
further in the near future. Similarly, for
title V, applications for title V permits
are not generally due until a year after
title V becomes applicable to a source.
Thus, for Step 2 title V sources, permit
applications are generally not due until
July 1, 2012, and states have not gained
title V permitting experience. Third, we
have not had the opportunity to develop
significant streamlining approaches,
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14235
largely because, as we stated in the
Tailoring Rule, certain streamlining
approaches require a longer process.
Because of these reasons and following
the criteria, described in the Tailoring
Rule, we are establishing Step 3 at the
current levels.
The following discusses these criteria,
beginning with the ability of states to
ramp up and build infrastructure, and
notes the states’ and our experience
with GHG permitting to date under the
current Step 1 and Step 2 applicability
thresholds. We also address the
additional two criteria noted above and
the environmental benefits potentially
associated with any further reduction in
the GHG PSD permitting thresholds.
B. Have states had adequate time to
ramp up their resources?
A criterion that we described in the
Tailoring Rule for whether to lower the
thresholds in Step 3 was whether the
permitting authorities could increase
their resources. As discussed previously
in the background section, we stated in
the Tailoring Rule that we expected
Steps 1 and 2 to result in an increase in
PSD permits for new construction and
modifications and in title V permits. We
estimated that Steps 1 and 2 would
result in a 42 percent increase in
administrative burdens for permitting
authorities. We expected that some
increase in state permitting resources
would be needed to accommodate, at
least in part, those new demands.
As noted, to this point states have not
been confronted with the amount of
GHG permit applications that we had
expected in the Tailoring Rule for Steps
1 and 2. EPA estimates that the
unexpected small number of permit
applications to this point reflect the
economic downturn, which has
depressed new construction and
modifications. The number of permit
applications in a given year is based on
individual business decisions which we
believe are directly linked to the
economic situation. The Agency expects
that this situation will be short-lived,
and that the pace of permitting will pick
up as economic conditions improve and
as GHG permitting becomes better
established. Thus, it is prudent for states
to continue to plan on confronting
additional administrative demands
expected as part of Steps 1 and 2. As
discussed in the following, they have
confronted other administrative burdens
as well and if the thresholds are lowered
in Step 3, they will confront still more
administrative burdens. Importantly,
based on our consultations with a
limited number of states, we do not
believe that states have had the
opportunity to obtain the necessary
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resources and to develop their
infrastructure to accommodate the level
of permitting expected in Steps 1 and 2.
In addition, an August 2011 report by
the Environmental Council of the States
(ECOS) 26 emphasizes the continued
need for additional resources before full
implementation of the program can
begin. It also notes that permitting
authorities expect workloads to double
or triple as a result of applications for
synthetic minor limits to sources who
wish to avoid GHG permitting.
Further, as quantified in the Tailoring
Rule, lowering the thresholds would
increase those burdens. We have
estimated that lowering the thresholds
to 60,000/60,000 would increase
administrative burdens by 20 percent
above the total burdens at Step 2 levels
(and 40 percent above the pre-GHG
permitting burdens). As noted above,
lowering them to 50,000/50,000 would
increase administrative burdens by 40
percent above the total burdens at Step
2 levels (and 99 percent above the preGHG permitting burdens). As we
discussed in the Tailoring Rule,
lowering applicability thresholds would
trigger requirements for more sources
that never before have been regulated
under the PSD and title V permitting
programs. As a result, permitting
agencies will need to conduct an
education and outreach program to raise
awareness and understanding of the
regulatory requirements for these
smaller sources. Absent this outreach
effort, we believe that many sources will
not understand, and perhaps may not
even be aware of, their new regulatory
obligations.
Finally, we note that certain
procedural aspects of the GHG
permitting process have proved to be
more resource- and time-intensive for
states than anticipated at the time of the
Tailoring Rule. In the final Tailoring
Rule, we finalized the applicability
thresholds within the definition of
‘‘subject to regulation,’’ instead of
within the ‘‘major stationary source’’
definition. We made this change in
regulatory approach because we
received information indicating that
many states could adopt the applicable
thresholds through a regulatory
interpretation of the term ‘‘subject to
regulation,’’ instead of a SIP revision.27
26 S. Brown, A. Fishman, ‘‘The Status of State
Environmental Agency Budgets, 2009–2011,’’
Steven Brown, Executive Director, and Adam
Fishman, Intern.
27 As discussed in the preamble to the final
Tailoring Rule (75 FR 31581), we participated in
teleconferences with 1 local and 6 state agency
permitting authorities on this topic, and they
generally agreed that this approach would better
facilitate state incorporation of the limitations in
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Since finalizing the Tailoring Rule, we
discovered that in fact, very few states
were able to adopt the applicable
thresholds by interpretation alone, and
instead needed SIP revisions to be able
to regulate GHGs under their approved
PSD programs at the levels of the final
Tailoring Rule. Moreover, some states
were obliged to invoke emergency
procedures to expedite revision of their
state laws. This unexpected, additional
state process required for adopting the
Tailoring Rule thresholds may have
delayed some states in developing their
permitting program infrastructure.
By the same token, for title V
programs, we believed that many states
could adopt the Tailoring Rule
thresholds through a regulatory
interpretation of the term ‘‘subject to
regulation,’’ and that this approach
would allow permitting authorities to
implement title V for GHGs quickly
with little rulemaking burden. However,
as it has happened, most states need to
change the state laws and/or regulations
governing their title V programs to be
able to permit GHGs at the Tailoring
Rule threshold levels. In fact, it turned
out that only 5 state programs and
numerous local districts in California,
did not need to enact program revisions.
In the Tailoring Rule, we expected
that over time, permitting authorities
would have the opportunity to increase
their resources to allow them to process
more GHG permit applications in a
timely fashion. To this point, we see
little evidence that permitting
authorities could increase resources
and, in fact, permitting authorities
generally are facing fewer resources.
Reductions in state environmental
agency budgets are fully consistent with
the overall reductions in state budgets
recently seen in the United States.
The August 2010 ECOS report, noted
previously,28 concluded that state
budgets decreased by an average of
approximately $21 million per state
from 2009 to 2011. On June 28, 2011,
the National Association of Clean Air
Agencies (NACAA) sent a letter to the
U.S. House of Representatives detailing
the status of 40 state and local air
quality agencies.29 The NACAA letter
indicates that 80 percent of air agencies
the final rule. We therefore concluded that it was
likely that the state rules were sufficiently openended to apply EPA’s approach by interpretation
(although some states might elect to pursue
rulemaking in addition to or instead of
interpretation).
28 ‘‘The Status of State Environmental Agency
Budgets, 2009–2011,’’ p. 3.
29 S. William Becker to Honorable Michael
Simpson, Chairman Subcommittee on Interior,
Environment, and Related Agencies, and Honorable
James Moran Ranking Member, Subcommittee on
Interior, Environment, and Related Agencies.
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experienced a decline in staffing levels
in the last 4 years. Over the years 2008–
2010, the average loss of staff per agency
was 16.7 percent. In addition to staffing
losses, 48 percent of air agencies
experienced furloughs, and the majority
faced significant declines in budgets.
These cutbacks resulted in curtailing
core air program activities including
permit issuance, and education and
outreach programs. In our recent
consultations with states most
confirmed that they have seen their
budgets and staffs reduced in recent
years as the states have responded to the
economic downturn and budget
shortfalls. For the previously described
reasons, states have not had the
opportunity to build capacity and
resources to handle GHG permitting.
Accordingly, this criterion of state
resources supports maintaining the
current thresholds.
C. What is the ability of permitting
authorities to issue timely permits?
The second criterion we address is
whether permitting authorities have the
ability to issue timely permits based on
efficiencies resulting from GHG
permitting implementation
experience.30 In describing this criterion
in the Tailoring Rule, we expected that
permitting authorities, by acting on the
anticipated volume of GHG PSD permit
actions, would have the opportunity to
establish efficient methods for resolving
issues and processing permits,
including developing expertise within
their staff. This would allow them to
achieve efficiencies that, in turn, would
create capacity for processing more GHG
permit applications. Thus, with this
criterion, we based our commitment to
complete the Step 3 rulemaking in part
on the assumption that Steps 1 and 2
would provide us with the necessary
information to determine whether and
when it has become possible for states
to administer GHG permitting programs
for additional sources. This has not yet
happened.
While we recognize that we have not
yet completed a full year of
implementation for Steps 1 and 2, GHG
permit applications are fewer than we
had expected. As of December 1, 2011,
the EPA and state permitting authorities
have issued only 18 GHG PSD permits.
As noted, these 18 permit actions have
been spread among 11 states and the
EPA. Almost all of the states have
issued only one GHG permit, and only
Michigan has issued as many as three
30 As noted above, this criterion may be measured
by the period of time permitting authorities need to
issue permits, and it also encompasses the sources’
ability to meet GHG permitting requirements.
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permits. This activity has simply been
too limited to allow States to build
internal capacity to handle GHG
permitting for a diverse set of sources,
to develop more efficient techniques for
permitting any particular source
category, or to develop streamlining
approaches to address GHG permitting.
In our consultations with the states,
some have confirmed that they have not
been able to build up their GHG
permitting infrastructure. However, they
generally have added that they do not
believe that 2011 has been
representative of the permitting burdens
that they expect will ultimately occur
under the current Tailoring Rule. In
sum, the states’ experiences to date do
not provide a basis for us to conclude
that permitting authorities in fact have
the ability to issue timely permits based
on GHG permitting experience thus far.
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D. Has the EPA developed streamlining
methods?
In the final Tailoring Rule, we
indicated that implementation of permit
streamlining approaches would assist
permitting authorities by removing
some sources from the permit program,
or allowing more efficient processing of
applications. As we indicated in the
final Tailoring Rule, however, we
expected it would take several years for
the EPA to develop and for States to
gain authority to implement effective
streamlining methods. We did not
anticipate that streamlining approaches
would be available by the time of the
Step 3 rulemaking. We also note that in
the previously described consultations,
the states reported that they have made
little progress in implementing
streamlining measures, and none have
adopted measures specifically to
address GHGs. This information is
consistent with EPA’s estimate, in
general, that it would take at least 3
years for EPA to develop, and for states
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to adopt and implement streamlining
methods, so that sufficient progress on
streamlining would likely not occur
before the Step 3 rulemaking deadline.
We are proposing requirements for
PALs and synthetic minor limitations
for sources, and these also constitute
streamlining methods that can be
expected to free up administrative
resources. However, these methods will
not be available in time to enhance the
state’s ability to manage the GHG
permitting programs during Step 3. The
benefits of a PAL will not be seen until
the States adopt these requirements into
their SIPs and sources apply for and
receive permits that reflect PALs. For
the previously-described reasons,
although we are making progress in
developing streamlining measures, the
current status of streamlining measures
supports maintaining the thresholds for
Step 3.
In addition, as noted, we are
continuing to consider other
streamlining approaches, including
limits on potential-to-emit, general
permits, and presumptive BACT. For
the most part, these other streamlining
methods even if further developed,
would have limited benefit for
improving permitting administration for
the source categories currently subject
to GHG PSD permitting or that are under
consideration for Step 3. We discuss our
progress in developing these other
streamlining methods, and their limited
utility for Step 3, in section VI. This
rulemaking provides a good opportunity
to provide the EPA with input on
additional streamlining ideas for
implementation of the GHG permitting
programs. More specifically, in section
VII.B we request comment on other
potential streamlining techniques that
may hold promise to reduce PSD and/
or title V permitting burden for sources
of GHGs and permitting authorities.
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E. Limited Benefit From Lowering
Thresholds in Step 3
The fact that PSD would apply to the
great bulk of GHG emissions at the
Tailoring Rule thresholds was a factor in
our decision to establish the thresholds
at the 100,000/75,000 levels. For the
current rulemaking, we have conducted
further analysis, which shows that
reducing the thresholds in Step 3 to as
low as 60,000/60,000 would bring
within the potential ambit of the PSD
program less than an additional 1
percent of all GHG emissions from all
stationary sources above the statutory
thresholds while potentially adding a
significant number of sources into the
permitting programs. This is because of
the large amount of GHG emissions that
come from very large sources, coupled
with the relatively small number of
additional sources that emit between the
100,000/75,000 and the 60,000/60,000
levels. Lowering the thresholds to
50,000/50,000 would bring within the
ambit an additional 3 percent, above the
100,000/75,000 levels, of all GHG
emissions from all stationary sources
above the statutory thresholds. Please
refer to the following Chart. Of course,
in any year, only a fraction of those
emissions would actually become
subject to PSD controls, which would be
the fraction emitted by sources that
undertake modifications or new
construction. Thus, the additional
reductions in GHG emissions from
lowering the thresholds in Step 3 would
be small under any circumstances even
if the thresholds were lowered to
50,000/50,000. This small amount of
environmental benefit is an additional
factor that, along with the additional
burden associated with permitting these
sources supports not lowering the
thresholds in Step 3.
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F. Conclusion
In the Tailoring Rule, we recognized
that the Step 1 and 2 thresholds we
promulgated would create significant
administrative burdens on permitting
authorities. We stated that we would
lower the thresholds, and thereby create
additional administrative burdens, only
after: (i) We had the opportunity to
develop efficiencies in GHG permitting
through streamlining measures; (ii) the
states had the opportunity to build up
their GHG permitting infrastructure and
to develop GHG permitting expertise;
and (iii) sources have the ability to meet
the requirements of the PSD program
and permitting authorities have the
ability to issue timely permits. These
things have not happened, as the
preceding discussion has made clear. As
a result, consistent with the
commitment we made in the Tailoring
Rule, lowering the thresholds is not
feasible at this time.
Importantly, because, as noted above,
permit activity is linked to macroeconomic conditions, we consider the
relative lull in permit activity due
largely to the recent economic downturn
to be temporary, and we expect that the
pace of permit applications will
increase. In fact, because of the link to
macro-economic conditions, it is
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difficult to predict whether the increase
in permit activity under Step 2 will
occur incrementally or rapidly. If it
occurs rapidly, it would be particularly
burdensome for states. As a result, even
a modest increase in permitting burden
that could result from lowering
thresholds in Step 3 could overwhelm
state permitting capacity and result in
substantial delays in processing permit
applications.
All told, these considerations support
maintaining the Tailoring Rule
thresholds through Step 3. Additional
time is required to develop streamlining
measures to expedite permit program
administration, and permitting
authorities need additional time to
secure resources, hire and train staff,
and gain experience with GHG
permitting before we move toward full
implementation of the program.
Accordingly and consistent with our
Tailoring Rule commitment, we propose
to maintain the thresholds of 100,000/
75,000 tpy CO2e.
We note that maintaining PSD and
title V applicability for GHG sources at
the current thresholds for Step 3 does
not have implications for whether we
will lower the thresholds in Step 4,
which we describe above, or afterwards.
Our actions in Step 4 will depend on
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our evaluation of the criteria and other
factors described above. If those criteria
and other factors point in the direction
of lowering the thresholds, we will do
so, and we will lower them to whatever
level indicated. A decision not to lower
the thresholds in Step 3 does not
foreclose a decision to lower them in
Step 4.
VI. Streamlining for PSD and Title V
Permitting of GHGs
In the Tailoring Rule, the EPA
committed to explore streamlining
measures as an integral part of the
phase-in approach to permitting
requirements for GHG emissions under
PSD and title V. Streamlining
techniques would allow permitting
authorities to be more efficient in
administering their GHG permit
programs by reducing the overall
resources required to administer the
PSD permitting program now and in the
future. By implementing effective
streamlining techniques permitting
authorities could move more rapidly
toward regulating a larger set of GHG
sources. In the Tailoring Rule, we
identified potential streamlining
options. We also acknowledged that it
will take us several years to develop,
and for states to gain authority to
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implement effective streamlining
methods. We committed to continue to
explore the identified options, and to
request comment on these and any
additional streamlining approaches in
the Step 3 rulemaking.
Today, we propose to adopt two
regulations: One that streamlines the
PSD permit program, and one that
potentially streamlines both the PSD
and the title V permit program. As
explained more fully below, the first
regulation expands the existing PAL
provisions to allow reviewing
authorities to establish GHG PALs on
either a mass-basis (tpy) or a CO2e-basis,
including for existing sources that are
not yet GHG major sources, and allows
PALs to be used as an alternative
approach for determining both whether
a project is a major modification and
whether GHG emissions are subject to
regulation. As discussed below, the
second regulation establishes a
mechanism that allows individual
sources to obtain synthetic minor
limitations (potential to emit (PTE)
limitations) for GHG emissions in areas
subject to a GHG PSD FIP, which would
allow certain sources or projects that
might otherwise be required to obtain a
GHG PSD permit to obtain a permit with
an emissions limitation that would
restrict the source’s GHG emissions
below the GHG PSD permitting
threshold.
We previously had not identified
PALs as a viable streamlining technique.
Since we finalized the Tailoring Rule,
we recognized that the existing PAL
regulation has limited value for GHG
sources, and that revising the current
PAL regulations to address the unique
applicability aspects associated with
GHGs could streamline PSD permitting
for more sources and make PALs for
GHGs more useful for all source
categories. Specifically, by amending
the regulations, we hope to encourage
greater use of GHG PALs, which in turn
would encourage sources to reduce
existing GHG emissions through
efficiency improvements and other
measures to maximize the operational
flexibility provided by the PAL.
In contrast, our proposed Tailoring
Rule discussed the synthetic minor—
PTE mechanism we now propose, but
expressed concerns that this approach
might overwhelm permitting authorities
based on the sheer number of sources
that could apply for individual
synthetic minor permits. Since
finalizing the Tailoring Rule, we have
continued to evaluate this. We have
concluded that offering a mechanism to
establish PTE limits for individual
sources provides environmental benefit,
and helps streamline the PSD and title
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V permit programs, at least in the short
term.
Accordingly, today we propose to
amend the federal PSD regulations to
create authority for (i) reviewing and
permitting authorities to issue PALs to
major and potentially-major GHG
stationary sources on either a mass-basis
or a CO2e basis and also to allow such
PALs to be used as an alternative
approach for determining whether a
project is a major modification and
subject to regulation for GHGs by
amending regulations in 40 CFR 51.166
and 52.21, and (ii) federal reviewing
authorities to issue GHG synthetic
minor permits by amending regulations
in 40 CFR 52.21. We also discuss our
progress in evaluating the suitability of
other streamlining options that we
identified in the final Tailoring Rule
including:
(1) Defining PTE for various source
categories,
(2) Establishing emission limits for
various source categories that constitute
presumptive BACT,
(3) Establishing procedures for use of
general permits.
Although we propose two
streamlining regulations on a more
rapid schedule than we originally
envisioned, we do not project that these
approaches will provide a sufficient
reduction in the immediate permit
workload to justify a decrease from the
Step 1 and Step 2 applicability levels.
The PAL rule, in fact, may increase the
immediate short term workload by
requiring development of PAL
provisions and potential SIP revisions,
as well as gaining experience in issuing
PALs, but will reduce the long term
workload on reviewing authorities and
sources. The GHG synthetic minor
permit program will reduce the short
term workload by providing a less
burdensome permitting process, and it
may allow some sources to avoid PSD
and title V permitting at the current
Step 1 and Step 2 applicability levels.
We believe that these streamlining
regulations will offer advantages to
industry, permitting authorities and the
environment. They will provide
operational flexibility to sources and
will also provide incentives for sources
to install good emission control systems
to maximize operational flexibility.
These streamlining regulations also help
build GHG permitting capacity, because
both regulations still require the
reviewing authority to gain an
understanding of GHG emissions for the
individual source in context of
establishing appropriate emission
limitations and monitoring,
recordkeeping and reporting
requirements. Accordingly, we believe
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implementation of both regulations
should decrease overall administrative
burdens and thus could enable us to
reduce the GHG applicability thresholds
at some time in the future.
The following discussion outlines our
two streamlining proposals, and then
discusses the viability of other
streamlining options.
A. Plantwide Applicability Limitations
for GHGs
1. What is the EPA proposing?
Our proposal intends to provide
permitting authorities with the authority
to issue GHG PALs to sources at which
GHG emissions could become subject to
regulation, and which then must
undertake a major modification NSR
applicability determination. We provide
a summary of several approaches for
amending the regulatory language to
implement a GHG PALs program, and
request comment on possible changes to
the regulations, any of which we may
finalize.
We propose three changes to the
existing PSD regulations in 40 CFR
51.166 and 52.21. These changes allow
reviewing authorities to issue PALs to
both existing major and potentially
major GHG stationary sources on either
a mass-basis or a CO2e basis and to
allow GHG PALs to be used as an
alternative approach for determining
whether a project is a major
modification and subject to regulation
for GHGs. The proposed changes would
continue to protect the environment
from adverse impacts from projects that
would increase emissions. The changes
would also streamline GHG
preconstruction permitting as part of
our overall efforts to tailor the PSD
applicability provisions to include
regulation of GHG emissions.
Specifically, we propose to amend the
regulations to allow reviewing
authorities to (1) issue PALs to GHGonly sources 31; (2) issue either a massbased (tpy) or a CO2e-based PAL to a
particular source; and (3) allow
compliance with a GHG PAL to be used
as an alternative applicability approach
for determining whether a project is a
major modification and subject to
regulation 32 for GHGs. We believe these
changes are appropriate to enable the
use of PALs for GHG, given the unique
31 A GHG-only source is a source that emits or has
the potential to emit 100/250 tpy GHG on a massbasis, and emits or has the potential to emit 100,000
tons per year of CO2e or more, but does not emit
or have the potential to emit any other regulated
NSR pollutant at or above the applicable major
source threshold.
32 For an explanation of ‘‘subject to regulation,’’
see the background section in the Tailoring Rule at
75 FR 31516.
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characteristics of GHGs and the subject
to regulation applicability approach
adopted for GHGs in the Tailoring Rule.
We request comment on each aspect of
this proposal.
2. What is a PAL?
Under the EPA’s regulations, a PAL is
an emissions limitation expressed in
tons per year for a pollutant that is
enforceable as a practical matter and is
established source-wide in accordance
with specific criteria.33 PALs are
voluntary in the sense that sources may,
but are not required, to apply for a PAL,
and whether to issue a PAL to particular
source is at the discretion of the
reviewing authority. PALs offer an
alternative method for determining
major NSR applicability. If the overall
emissions at a source remain below the
PAL level, the source can make changes
at the source that do not trigger major
NSR. This allows sources to respond
rapidly to market conditions, while
assuring there is no adverse impact to
the environment from the change. A
PAL also results in significant
environmental benefit, by providing the
community with an understanding of
the long-term emissions impact from a
facility, preventing emissions creep (i.e.,
a series of unrelated individual
emissions increases that are below
major NSR applicability thresholds),
and requiring enhanced monitoring,
recordkeeping and reporting to
demonstrate compliance with the PAL.
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3. Why are we proposing to amend the
regulations?
The EPA reads its current PAL and
PSD regulations as restricting permitting
authorities from issuing certain kinds of
GHG PALs. We interpret our current
regulations to restrict sources that can
obtain GHG PALs to existing major
stationary sources, 34 and to not allow
sources to rely on the PALs emissions
limitation in determining whether GHG
emissions are ‘‘subject to regulation.’’
The PSD provisions generally define a
‘‘major stationary source’’ as a stationary
source which emits or has the potential
to emit 100 or 250 tpy or more of a
regulated NSR pollutant, depending on
the type of source.35 A GHG-only source
is a source that emits or has the
potential to emit 100/250 tpy GHG on a
mass-basis, and emits or has the
potential to emit 100,000 tons per year
of CO2e or more, but does not emit or
have the potential to emit any other
regulated NSR pollutant at or above the
33 40
CFR 52.21(aa)(2)(v).
CFR 52.21(aa)(1).
35 40 CFR 52.21(b)(1)(i)(a)–(b).
34 40
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applicable major source threshold.36
Regardless of the amount of GHGs
currently emitted, a GHG-only source is
a minor source for purposes of PSD, and
only becomes major for PSD when it
proposes to undertake a change that
increases GHG emissions by at least
75,000 tpy CO2e. Currently, reviewing
authorities using the federal PAL
provisions 37 can only issue a PAL to a
GHG-only source when the source
proposes to undertake such a change,
thus becoming a major stationary
source.38 As a result, GHG-only sources
may not currently use the alternate
major NSR applicability provisions
provided by a PAL in the same way that
existing major stationary source of other
regulated NSR pollutants may. Instead,
GHG-only sources must wait to obtain a
PAL until they actually propose to make
a change that qualifies the source as a
major stationary source under the PSD
program.39
Moreover, under current regulations
any EPA-issued PAL can only be massbased. This requirement is due to the
fact that PALs are an alternative for
NSR, which is triggered by mass-based
changes in emissions. Consequently,
GHG sources use tpy CO2e to determine
whether a change causes GHG emissions
to be subject to regulation, but tpy of
mass emissions of the pollutant to
determine whether a change results in a
major modification. Thus, under the
current regulations, sources using the
PAL provisions must still monitor both
metrics to ultimately determine whether
a change triggers major NSR review.
We believe changing the regulations
to remove these mass-based restrictions
will provide sources with additional
operational flexibility, and reduce GHG
workload burdens on reviewing
authorities by decreasing the number of
PSD permit applications reviewing
authorities must process for these
sources over the long term. Providing an
option that allows a source to use a GHG
PAL will help streamline the major NSR
permitting program and provide more
operational flexibility to sources. Being
able to establish a PAL would provide
planning certainty to sources, and
would relieve the current time pressure
to issue a PAL permit concurrent with
36 For the purpose of this rule, we term such
sources ‘‘GHG-only sources.’’
37 There can be alternative state PAL provisions
or they may simply adopt EPA’s regulations.
38 40 CFR 52.21(b)(49)(v)(b).
39 Because an anyway source emits or has the
potential to emit another regulated NSR pollutant
in amounts at or above the major source thresholds,
it is a major stationary source, and it may apply for
a PAL for its GHG emissions on a mass basis at any
time under the current regulations as long as it
otherwise qualifies (e.g., has sufficient emissions
data to establish a PAL).
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authorization for a planned major
modification which could potentially
delay that project. We also believe that
compliance with a GHG PAL generally
assures that the environment remains
protected from adverse air impacts
resulting from changes a source
undertakes in compliance with such a
PAL, regardless of which metric is
specified to measure GHG emissions in
that PAL, because emissions cannot
exceed this pre-established level
without further review. PALs also
provide an incentive for a source to
minimize GHG emissions increases from
future projects.
A significant rate is a threshold for
applying NSR to modifications. Only
emissions rate increases above the
significant rate trigger major NSR
requirements. Currently, a reviewing
authority may establish the PAL level
for a pollutant by adding its significant
rate to baseline actual emissions. Unless
a significant emissions rate has been
established, the significant rate is
effectively zero, i.e., any increase in
emissions would trigger NSR.
The EPA did not promulgate a massbased significant emissions rate for GHG
emissions in the final Tailoring Rule.
Thus, if a reviewing authority
establishes a mass-based GHG PAL,
under our current interpretation of the
regulations, the PAL may not include
any margin above the baseline actual
emissions for emissions growth. Absent
this margin, a GHG PAL provides less
flexibility to a source when compared to
PALs for other regulated NSR
pollutants.
The proposed rules provides GHG
PAL sources with the same kind of
flexibility sources currently have for
other regulated NSR pollutants by
allowing sources to establish a CO2ebased PAL using the 75,000 tpy CO2e
applicability threshold for GHGs. A
reviewing authority could add the
75,000 tpy CO2e to a source’s CO2e
baseline actual emissions to establish
the PAL level, because the Tailoring
Rule established 75,000 tpy CO2e as the
appropriate rate of emissions increase
for the GHG applicability threshold for
existing sources. Changing the
regulations will also have the effect of
streamlining future major NSR
applicability determinations for sources
that choose a CO2e PAL, by eliminating
the need to evaluate GHG emissions on
a mass basis for major NSR applicability
as long as the source is complying with
the CO2e PAL, because a CO2e PAL can
function to assure both that GHG
emissions are not subject to regulation,
and that a change does not trigger a
major modification.
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In sum, we believe that the current
PAL regulations are inconsistent with
the outcome achieved when the PAL
rules are applied to regulated NSR
pollutants other than GHGs, and
therefore are overly restrictive with
respect to GHG-only sources.
Accordingly, we are proposing to amend
the major NSR regulations and PAL
rules to allow reviewing authorities to
(1) issue PALs to GHG-only sources; 40
(2) issue either a mass-based (tpy) or a
CO2e-based PAL to a particular source;
(3) allow CO2e-based PALs to include
the 75,000 tpy CO2e rate of emissions
increase applicability threshold; and (4)
allow compliance with a GHG PAL to be
used as an alternative applicability
approach for determining both whether
a project is a major modification and
whether GHG emissions are subject to
regulation. Provided a source complies
with a GHG PAL, GHG emissions at the
source will not be ‘‘subject to
regulation,’’ and a project at the source
will not result in a major modification.
We request comment on each one of
these proposals.
In the Tailoring Rule the EPA
amended the definition of ‘‘subject to
regulation’’ to establish a threshold level
of GHG emissions that a source must
meet, on both a source and project basis,
before GHGs to be considered an NSR
regulated pollutant for PSD permitting
purposes. However, the EPA also made
clear that its action had the same
substantive effect, and should be treated
as if the EPA had revised other
components of the definition of ‘‘major
stationary source’’ to achieve the same
effect. Thus, in addressing PALs for
GHGs in this rule the EPA is continuing
to focus on the thresholds incorporated
into the ‘‘subject to regulation’’
provision, consistent with the approach
in the Tailoring Rule.
4. Options for Allowing GHG-Only
Sources To Obtain a GHG PAL
We request comment on two
approaches for regulating GHG-only
sources under a PAL. We call the first
approach the Major Source Opt-in
Approach. This approach is consistent
with the current restriction that only
allows reviewing authorities to issue
PALs to existing major stationary
sources, but the approach would
provide GHG-only sources the ability to
become existing major stationary
sources, and thus receive PALs for
40 A GHG-only source is a source that emits or has
the potential to emit 100/250 tpy GHG on a massbasis, and emits or has the potential to emit 100,000
tons per year of CO2e or more, but does not emit
or have the potential to emit any other regulated
NSR pollutant at or above the applicable major
source threshold.
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GHGs and any other pollutant emitted
by the source. A GHG-only source could
become a major stationary source by
agreeing to be considered an existing
major stationary source, without having
a specific qualifying project that
increases CO2e emissions at the source
by at least 75,000 tpy CO2e.
We call the second approach the
Minor Source Approach. In contrast to
the Major Source Opt-in approach,
under the Minor Source Approach a
GHG-only source would remain a minor
source. A reviewing authority could
issue GHG PALs to the GHG-only
sources without requiring the source to
become an existing major stationary
source, and thus could not include PAL
limits for non-GHG pollutants.
Under the Major Source Opt-in
Approach, we would amend the
regulations to allow any existing
stationary source that emits or has the
potential to emit GHGs in amounts
above the first part of the ‘‘subject to
regulation’’ applicability threshold
(currently 100,000 tpy CO2e) and above
the 100/250 tpy major stationary source
threshold, to submit an application for
a PAL, in which the source agrees to be
considered an existing major stationary
source for GHG emissions. As long as
the source complies with the GHG PAL,
it would not trigger the PSD permitting
requirements for GHGs for any project,
but the regulations would continue to
require the source to evaluate whether
the change triggers PSD applicability for
other regulated NSR pollutants in the
attainment or unclassifiable area. This is
because PSD applies whenever a major
stationary source undertakes a project
that results in a significant net
emissions increase of any regulated NSR
pollutant.
The EPA believes that allowing GHGonly sources to opt into major stationary
source status is consistent with the Act.
But for the Tailoring Rule, GHG-only
sources qualify as ‘‘major emitting
facilities,’’ because such sources emit or
have the potential to emit 100 or 250 tpy
GHG. Thus, these sources fall within the
statutory scope of sources that, absent
the Tailoring Rule, we would have
authority to regulate for purposes of
PSD. Although we took a limited
interpretation of how to exercise this
authority through the Tailoring Rule, we
believe that the Major Source Opt-in
Approach is consistent with the
Tailoring Rule’s schedule for further
phasing-in additional GHG sources into
the PSD permitting program.
In the final Tailoring Rule, we
indicated that we would base our
decision to include additional sources
in the GHG permitting programs on an
assessment of three criteria. These
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criteria are: (i) Whether the EPA could
develop streamlining measures, (ii) the
time that permitting authorities need to
ramp up their resources, and (iii)
sources’ abilities to meet the
requirements of the PSD program and
permitting authorities’ ability to issue
timely permits. Each of these criteria
supports expanding the PSD permit
program to include a source that opts
into the GHG PAL regulatory structure.
First, while the Major Source Opt-in
Approach has the potential to increase
the total number of GHG major
stationary sources, it does so in a
manner that decreases the long-term
permitting burden for both the source
and the reviewing authority. This is
because the source would likely require
fewer permit actions over the life of a
PAL. Thus, the Major Source Opt-in
approach streamlines the PSD
permitting program, which will assist
permitting authorities when the EPA
regulates additional GHG sources under
the PSD program. Second, permitting
authorities can gain valuable experience
in issuing PAL permits that can build
staff expertise. This, in turn, helps
permitting authorities’ efforts to ramp
up their PSD permitting programs in a
more timely and efficient manner.
Third, sources demonstrate an ability to
comply with major stationary source
permitting requirements by voluntarily
seeking a PAL under the Major Source
Opt-in provisions. If a source could not
comply, then it would not seek a GHG
PAL. Moreover, reviewing authorities
likely would only agree to issue a PAL
if they believe they have the necessary
resources to issue the PAL(s), and doing
so would not detrimentally affect their
obligations to otherwise issue timely
permits. In sum, if a source opts-into the
program, and a reviewing authority
agrees to permit the source, then we
believe these sources are properly
brought within the PSD permitting
program.
Under the Major Source Opt-in
Approach, a source could also choose to
establish PALs for its non-GHG
regulated NSR pollutants to better
manage applicability for all pollutants at
the source, including those regulated
NSR pollutants for which the source is
not major. Under this approach, the
source will continue to be considered a
major source under PSD and title V at
the expiration of the PAL (generally 10
years after issuance). If the source is
subject to the federal PSD program for
GHG emissions, and to a state SIPapproved PSD program for its non-GHG
regulated NSR pollutants, then whether
a source can apply for, and receive, a
PAL for its non-GHG regulated NSR
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pollutants will be governed by the
applicable SIP-approved regulations and
the state reviewing authority. Neither
the EPA, nor its delegated authority,
would issue PALs for non-GHG
regulated NSR pollutants under 40 CFR
52.21, unless a FIP would govern PSD
applicability for that non-GHG
pollutant. As with the current PAL
regulations, the ultimate decision to
issue a PAL remains with the reviewing
authority, and individual permitting
authorities will have to determine
whether they will issue PALs for nonGHG pollutants also emitted from a
source that receives a GHG PAL through
the Major Source Opt-in Approach.
We are concerned, however, about the
potential impact on reviewing
authorities of allowing GHG-only
sources to obtain PALs for all their
regulated NSR pollutants, as this could
cause a short-term increase in regulatory
burden on permitting authorities at a
time when they are ramping up their
programs to address other GHG major
stationary sources. We request comment
on this aspect of the Major Source Optin Approach and welcome suggestions
for refining the approach to address
concerns with short-term workload
burdens for permitting authorities.
Under the Minor Source Approach,
we would amend the regulations to
allow a GHG-only source to submit an
application for a GHG PAL, and would
also allow the source to maintain its
minor source status. A GHG-only source
that complies with its GHG PAL will not
trigger PSD permitting requirements for
GHGs, but could trigger PSD for other
regulated NSR pollutant if it undertakes
a change that increases emissions by a
‘‘major’’ amount for any non-GHG
regulated pollutant. See 40 CFR
51.166(b)(1)(i)(c). That is, this approach
would authorize permitting authorities
to use the PAL program for minor
sources only to regulate GHG emissions.
Moreover, under the Tailoring Rule
existing minor sources that emit only
GHGs, but no other regulated pollutants
in major amounts, must determine
whether any project will result in GHG
emissions that are subject to regulation
(on a CO2e basis), and correspondingly
will also result in a major modification
(on a mass basis). Because GHG-only
sources must undertake these
determinations for any change, even
those that would not make the source
major for GHGs, we believe that
extension of the PAL program to these
sources through the Minor Source
Approach is consistent with the
purposes and design of the PAL
program—to allow use of a PAL as an
alternate major modification
applicability approach.
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Issuing PALs to GHG-only sources
that remain minor sources does not
conflict with the basis for the current
PAL rules. When we promulgated the
PAL rules in 2002 (67 FR 80186), we
limited the application of the PAL
provisions to existing major stationary
sources only. We included this
provision based on our decision to limit
PALs to sources that had historical
emissions through which the reviewing
authority could establish a baseline
actual emissions level. New major
stationary sources do not have historical
actual emissions from which a
reviewing authority can establish an
actuals PAL, and so we declined to
include these sources in the actuals PAL
program.
When we originally promulgated the
PAL rules, we also chose not to extend
the PAL program to minor (source) NSR
permit programs, because PALs are an
alternate major NSR applicability
provision to determine whether a
project results in a major modification,
and we did not believe the program
would be useful to minor sources. At
that time, the rules generally required
only existing major stationary sources to
undertake a major modification
applicability analysis to determine
whether a change triggers PSD review.41
Given the unique ‘‘subject to regulation’’
PSD applicability requirement for
GHGs, wherein an existing source that
emits major amounts of GHGs is a major
stationary source only at the time it
proposes to undertake a project that will
result in an emissions increase of 75,000
tpy CO2e or more, we do not believe that
extending the PAL provisions to GHGonly sources runs afoul of the reasoning
we provided when initially limiting the
PAL program to existing major
stationary sources.
As explained previously, we propose
to limit the Minor Source approach to
allow reviewing authorities to establish
PALs only for GHG emissions, and not
for other regulated NSR pollutants for
which the source remains a minor
source. Because the GHG-only source
remains a minor source (absent any
other PSD-triggering change) and,
generally, will not trigger a major
modification applicability analysis for
increases in other regulated NSR
pollutants, we believe it unnecessary to
extend the PAL authority under this
approach to other pollutants. Moreover
we recognize that extending the PAL
program in that way could place a
burden on permitting authorities and
41 The provisions in 40 CFR 51.166(b)(3)(iii)
illustrate an exception to this general rule but we
did not contemplate that exception in creating the
PAL rules in 2002.
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redirect resources needed to issue
permits to other GHG major stationary
sources.
The Minor Source Approach is
consistent with the CAA in that it
regulates sources that but for the
Tailoring Rule would be major
stationary sources based on the mass of
their GHG emissions. This approach is
also consistent with our Tailoring Rule
principles. But unlike the Major Source
Opt-in Approach, which defines the
scope of pollutants included in the PAL
based on an individual permitting
authority’s discretion and ability to
regulate a given source, under the Minor
Source Approach, the EPA has
determined that the scope of the
program is limited only to a source’s
GHG emissions and could not include
PAL limits for non-GHG pollutants
emitted in amounts below the major
source levels. Again, as with the Major
Source Opt-in Approach, the Minor
Source Approach fulfills our
streamlining goals by bringing more
sources into the major NSR permitting
provisions, in a manner that best
manages reviewing authorities’ longterm permit burden.
We request comment on both the
Major Source Opt-in Approach and the
Minor Source Approach. We also
request comment on whether we should
finalize both approaches. That is,
sources would have the ability,
consistent with the ultimate decision of
its reviewing authority, either to opt
into major stationary source status and
establish PALs for all pollutants, or to
maintain minor source status and obtain
a PAL for GHG emissions only.
5. Extending PALs to GHGs on a CO2e
Basis and Using PALs To Determine
Whether GHG Emissions Are ‘‘Subject
to Regulation’’
Currently, the EPA reads the PAL
regulations to allow reviewing
authorities to establish a GHG PAL only
on a mass basis. Today we propose to
allow reviewing authorities to establish
GHG PALs on either a mass basis or a
CO2e basis. More specifically, we
propose to allow reviewing authorities
to establish a CO2e-based GHG PAL by
adding up to an amount equal to the
emissions increase contained in the
‘‘subject to regulation’’ applicability
threshold (e.g., 75,000 CO2e) to the
source’s baseline actual emissions. We
also propose to allow GHG PALs, either
on a mass basis or a CO2e basis, to serve
as an alternate applicability approach
for determining whether GHG emissions
are subject to regulation. That is, rather
than applying the emissions increase
tests (significant emissions increase and
significant net emissions increase)
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currently contained in the ‘‘subject to
regulation’’ definition, a source could
demonstrate that GHG emissions are not
‘‘subject to regulation’’ by complying
with a GHG PAL. Compliance with a
GHG PAL would be used as an
alternative applicability approach for
determining that the source neither
causes GHG emissions to be subject to
regulation, nor causes the GHG source
to have a major modification.
We further believe that it is necessary
to allow the alternative applicability
provision to be included in ‘‘subject to
regulation’’ determinations for GHG
PALs, because failing to do so would
negate the flexibility gained by creating
a GHG PAL. This is because without the
changes EPA is proposing, sources
would still be required to monitor
individual emissions changes using the
procedures in 40 CFR 52.21(a)(2)(iv) to
determine whether a source triggers the
subject to regulation definition. The
determination of whether GHGs are
‘‘subject to regulation’’ uses procedures
that rely on an emissions-unit-byemissions-unit analysis, and a shorter
contemporaneous period to measure
emissions changes, neither of which are
required under a PAL. We believe that
the enhanced recordkeeping, reporting
and monitoring burdens of a PAL, and
the environmental benefits resulting
from a PAL, warrant extension of the
alternate applicability provisions to
subject to regulation determinations to
assure that the PAL provides the
intended flexibility to sources.
When we proposed the Tailoring
Rule, we proposed to include
applicability thresholds within the
definitions of major stationary source
and major modification, based on tpy
emissions of CO2e. We also proposed to
establish a CO2e-based significant
emissions rate. In the final rule, we
changed our regulatory approach and
instead included these applicability
thresholds within the ‘‘subject to
regulation’’ definition, and we did not
revise the definition of significant to
include a CO2e-based emissions rate.
We did so, in part, because we intended
this change in regulatory structure to
facilitate more rapid adoption of the
rules by reviewing authorities.
Nonetheless, we intended the definition
of ‘‘subject to regulation’’ to function in
tandem with the definitions of ‘‘major
stationary source’’ and ‘‘major
modification’’ to determine whether a
given project triggers PSD
preconstruction permit requirements.
That is, if a source emits GHG emissions
at a level that causes the emissions to
become ‘‘subject to regulation,’’ that
same level of emissions increase will
likely cause the source to be a major
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stationary source and trigger PSD
requirements as a major modification.
Accordingly, since the 75,000 CO2e
applicability threshold contained in the
second part of the ‘‘subject to
regulation’’ definition works in tandem
with the ‘‘major modification’’ provision
to determine whether major NSR
applies we are proposing that a CO2ebased GHG PAL can be established by
adding up to an amount equal to 75,000
CO2e to the source’s baseline actual
emissions as this is the appropriate
applicability threshold for CO2e tpy
GHG.
In our proposed Tailoring Rule, we
noted that, in rare instances, there may
be an exception to this general
principle, if a source emits very small
amounts of a particular non-CO2 GHG
that carries a very large GWP. 74 FR
55330. We noted our concern that the
proposed rule could cause sources,
whose mass emissions do not meet the
major stationary source tpy threshold, to
nonetheless be regulated under the
permit programs. When we finalized the
Tailoring Rule using the subject to
regulation approach, we resolved this
concern by retaining both a mass-based
threshold and a CO2e-based threshold.
Our intent in retaining both thresholds
was to assure that no source was subject
to PSD that would not otherwise meet
the statutory criteria for treatment as a
major stationary source.
This same regulatory structure creates
the opposite effect for sources operating
under a GHG PAL. Instead of providing
GHG PAL sources with the ability to use
either threshold to show that they are
not a major stationary sources and that
major NSR does not apply, sources must
monitor both thresholds to prove this
outcome under the current rules. This is
because a mass-based GHG PAL cannot
assure that there is no increase in CO2e
tpy GHG. Expanding the GHG PAL
program to allow GHG PALs to be used
as an alternative applicability provision
for both the major modification and
‘‘subject to regulation’’ determinations
resolves this dual threshold issue. We
also believe that we may properly allow
GHG PALs to be expressed on either a
mass or CO2e-basis, because, in essence,
we intended the subject to regulation
determination to be functionally
equivalent to making a major
modification applicability
determination for GHG sources. We
resolve our previous concern that
relying on a single metric might lead to
over-inclusion of sources that do not
meet the statutory threshold for the PSD
program by limiting the GHG PALs
program to GHG-only sources, which
are defined as those sources that, by
definition, meet the 100/250 tpy major
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stationary source threshold. We request
comment on all aspects of this proposal.
6. Can a GHG source that already has a
mass-based GHG PAL obtain a CO2ebased PAL once we issue final changes
to the PAL rules?
We are proposing to add transition
provisions to the PAL regulations that
would allow a GHG source that has a
mass-based GHG PAL to convert to a
CO2e-based GHG PAL once, at the
source’s option, and if agreed to by the
reviewing authority. We intended these
provisions to provide integrity to the
PAL provisions, and assure that sources
avoid casually opting out of the PAL
program, rather than go through the
rigorous procedures for increasing the
level of the PAL.
The current PAL regulations do not
contain specific provisions for
dissolving an established PAL during
the PAL term, but contain provisions for
when a PAL expires. It is inappropriate
to apply these rigorous procedures to
sources that would have elected to seek
a CO2e-based PAL in lieu of a massbased PAL, had such an option been
available. We propose to include
regulatory language that the expiration
of PAL provisions do not apply when a
source elects to convert from a massbased GHG PAL to a CO2e-based PAL.
Instead, a source could transition to a
CO2e-based PAL and the permitting
authority could dissolve the mass-based
PAL without retaining the mass-based
PAL level as a restriction on allowable
emissions.
We also propose to include provisions
that allow the mass-based GHG PAL to
be converted to a CO2e-based GHG PAL
in the middle of the PAL effective
period. Under the transition provision,
the reviewing authority would propose
to dissolve the existing mass-based PAL
permit at the time it proposes the new
CO2e-based PAL permit for public
comment. The reviewing authority
would establish the new CO2e-based
GHG PAL following the standard
procedures (10-year lookback for
baseline actual emissions, 10-year PAL
effective period, etc.) in the current PAL
regulations. Once a final CO2e-based
PAL permit is issued, the permitting
authority may also finalize its proposed
action to dissolve the mass-based PAL
permit and remove any applicable
requirements from the title V permit
following the appropriate title V
procedures. This would, in essence,
create a new PAL and establish a new
10 year term.
We also propose to allow a reviewing
authority to use a slightly different
procedure for this conversion from the
standard PAL procedures. If the baseline
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actual emissions period the reviewing
authority used to establish the massbased GHG PAL is no longer within the
10 year lookback period currently
available to the source, then the
transition provisions would allow that
source a one-time conversion of a massbased GHG PAL to a CO2e-based GHG
PAL using the same baseline actual
emissions period used to establish the
mass-based GHG PAL. The new PAL
effective period would be the remainder
of the mass-based GHG PAL’s effective
period. For example, if a reviewing
authority issued a mass-based GHG PAL
to a source that became effective in
2011, that PAL’s effective period runs
for 10 years through 2021. If the same
source converts that mass-based GHG
PAL to a CO2e-based PAL in 2014, and
elects to use the expired, mass-based
GHG PALs baseline actual emissions
years, then the CO2e-based GHG PAL
would be effective for the remaining 7
years of the mass-based GHG’s PAL
effective period.
We request comment on these
procedures for converting a mass-based
GHG PAL to a CO2e-based GHG PAL.
Specifically, we request comment on
whether there are existing mass-based
GHG PALs for which transition
provisions are needed. More
specifically, should we allow such a
transition, or should we decline to
provide transition provisions? If we
decline to provide a transition should
we instead require sources either to
maintain both PALs, or require the
sources to comply with a source wide
emissions cap equal to the PAL level
that functions as a synthetic minor
limitation? We also request comment on
whether we should provide a temporary
transition provision to allow sources to
convert from the mass-based GHG PAL
to the CO2e-based GHG PAL only for a
limited time after the effective date of
the regulatory changes, or whether the
procedures should remain available for
the duration of the PAL provisions.
Specifically, we request comment on
whether there are implications for major
NSR compliance if sources are allowed
to switch from a mass-based PAL to
CO2e-based PAL at any time, or whether
providing the option for the duration of
the program could encourage certain
types of environmentally preferable
projects.
7. How would we change the regulatory
provisions to implement PALs for GHGonly major sources?
To implement our proposed changes,
we would revise a number of existing
regulatory provisions, depending on the
specific approach selected. Under the
Major Source Opt-in Approach, we
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propose to change the definition of
major stationary source at 40 CFR
52.21(b)(1) to add a paragraph that
defines Major Source Opt-in GHG-only
sources as major stationary sources.
Under the Minor Source Approach, we
propose to revise the applicability
paragraph for the PAL provisions at 40
CFR 52.21(aa)(1) to include GHG-only
sources.
In addition, under the Major Source
Opt-in Approach, we propose to revise
the PAL Permit Application
Requirements provisions at 40 CFR
52.21(aa)(3) and (4) and Contents of the
PAL Permit provisions at 40 CFR
52.21(aa)(7) to include provisions for
opting into existing major stationary
source status.
Under either approach, we would: (1)
Revise the PAL rules to add transition
provisions to 40 CFR 52.21(aa) for
converting from a mass-based PAL to a
CO2e-based PAL including revisions to
the PAL expiration provisions; (2) add
a paragraph to the ‘‘subject to
regulation’’ definition at 40 CFR
52.21(b)(49) and the PAL applicability
section at 40 CFR 52.21(aa)(1) to
indicate that a source that complies
with a GHG PAL is not subject to
regulation for GHG emissions; (3) revise
the PAL rules at 40 CFR 52.21(aa)(6) to
allow CO2e-based PALs to include the
75,000 tpy CO2e rate of emissions
increase applicability threshold by
adding this amount to a source’s
baseline actual emissions; and (4) revise
the definition of PAL and PAL pollutant
at 40 CFR 52.21(aa)(2)(v) and (x) to
include CO2e as a metric of GHG
emissions.
B. Synthetic Minor Source Permitting
Authority for GHGs
1. What is the EPA proposing?
We are proposing to create synthetic
minor permit authority, within the
existing federal PSD regulations in 40
CFR 52.21, for the purpose of issuing
‘‘subject to regulation’’ synthetic minor
permit limitations on a CO2e basis for
GHGs. We are also proposing to amend
the federal minor NSR program in
Indian country for the purpose of
issuing synthetic minor permit
limitations for GHGs. These regulatory
changes would allow certain sources or
projects that might otherwise be
required to obtain a GHG PSD permit,
pursuant to 40 CFR 52.21, to obtain a
‘‘subject to regulation’’ limitation that
restricts the source’s GHG emissions
below the ‘‘subject to regulation’’
threshold(s). That is, for sources located
in a jurisdiction in which the federal
PSD permitting program applies, we
propose a mechanism that would allow
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the EPA, or its delegated agent, to issue
a permit containing synthetic minor
limitations for GHGs to any source that
emits or has the potential to emit GHGs
above the applicable subject to
regulation thresholds and that
voluntarily requests a restriction on its
PTE. Although we would establish this
program using our PSD permitting
authority, a synthetic minor permit
limitation issued under this authority
could also effectively limit the source’s
GHG PTE for purposes of title V
applicability. As a general matter, we
believe that synthetic minor limits for
GHGs should be available as an option
for sources that would prefer to take a
legally and practicably enforceable
limitation on GHG emissions in order to
avoid major source permitting
requirements. We believe that many
state and local permitting authorities
will already have mechanisms in place
to issue such GHG synthetic minor
limits to sources that request them,
including title V permitting programs,
state minor source permitting programs,
or federally enforceable state operating
permit programs. Nonetheless, we
request comment on whether permitting
authorities implementing SIP-approved
PSD permitting programs lack
mechanisms to create synthetic minor
limitations for GHGs, and if so, how that
gap in permitting authority or
mechanism could best be filled.
It is important to note that we only
propose to issue synthetic minor
permits for GHG emissions, not for other
regulated NSR pollutants, and we will
only do so for sources located in areas
where the EPA is the GHG permitting
authority (including areas subject to a
GHG FIP). These synthetic minor
permits would also be available where
the federal PSD program is implemented
by a state permitting authority under a
delegation agreement because delegated
states issue PSD permits on behalf of the
EPA in those areas under 40 CFR 52.21.
We, however, are not proposing to issue
synthetic minor source limits for nonGHG pollutants under this rule. States
and some tribes operate minor source
permitting programs that cover these
other pollutants, and the EPA also
operates a minor source permitting
program in Indian country. If a source
wishes to obtain a synthetic minor limit
for any other pollutant, it should seek
that limit under the applicable minor
source program.
The EPA has long recognized
synthetic minor permits as a way to
restrict a source’s PTE and thus avoid
major source NSR and title V permitting
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requirements.42 While we discussed the
use of synthetic minor permits for
establishing PTE restrictions on GHG
emissions in our proposed Tailoring
Rule, we expressed concerns that
establishing GHG synthetic minor
limitations in individual permits could
overwhelm reviewing and permitting
authorities based on the sheer number
of sources that we anticipated would
apply for PSD permits. Thus, we
proposed to focus our attention on
developing category specific approaches
for limiting PTE.
Since finalizing the Tailoring Rule,
we reconsidered this conclusion, and
now believe that establishing synthetic
minor limitations for individual sources
could increase permitting authorities’
capacity to regulate GHG emissions by
providing experience in addressing
emissions limitations, and monitoring,
recordkeeping and reporting
requirements specific to GHG emissions.
We also believe that it would lead to an
overall reduction of permitting burden
in that synthetic minor permits
generally require fewer administrative
resources than full PSD permitting and
title V permitting, to which these
sources could otherwise be subject.
Moreover, streamlining ideas often
result from repeat experiences. After
issuing permits that share common
features, a reviewing or permitting
authority might formulate new ideas for
effective streamlining techniques. We
now believe that issuing synthetic
minor permits is a key component of
our overall efforts to gain experience in
permitting GHG sources to phase
additional sources into the GHG
program, because it can help manage
sources currently subject to the program
and help identify opportunities for
further streamlining the GHG permitting
programs. Moreover, allowing sources to
obtain a synthetic minor limitation, in
lieu of triggering major NSR
requirements, encourages sources to
effectively minimize project emissions
through efficiency improvements or
other measures such that the total GHG
emissions to the environment from the
project are lower than might otherwise
occur.
We acknowledge that other
mechanisms may currently exist to
establish synthetic minor limitations for
GHGs. We do not intend today’s
proposal to supplant or supersede other
42 See, e.g., Guidance on Limiting Potential to
Emit in New Source Permitting (June 13, 1989);
Guidance and Enforceability Requirements for
Limiting Potential to Emit through SIP and § 112
Rules and General Permits (Jan. 25, 1995). The rules
proposed here for limiting potential to emit should
be read in light of our extensive prior guidance on
this issue.
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available mechanisms for creating
synthetic minor limitations. Rather, our
intent is to ensure that we are able to
issue GHG synthetic minor limits in the
areas subject to the federal PSD
permitting program for GHGs to avoid a
potential gap in synthetic minor
permitting authority and to ensure that
we are able to efficiently manage our
administrative resources for the federal
PSD program. Notwithstanding today’s
proposal, we encourage states to use
appropriate existing mechanisms, or to
create new authority if needed, to issue
synthetic minor limitations for GHGs.
2. What is synthetic minor limitation,
and what is its function?
A synthetic minor limitation is a
legally and practicably enforceable
restriction that a source voluntarily
seeks to avoid major stationary source
requirements, such as the PSD or title V
permitting programs. Synthetic minor
limitations allow sources to avoid these
permit programs in two ways. First, a
reviewing or permitting authority can
issue a synthetic minor limitation to
assure that a stationary source does not
emit above the major stationary source
threshold, and therefore, that the
stationary source remains a minor
source for either one or both permit
programs. Second, a reviewing or
permitting authority can issue a
synthetic minor limitation to assure that
emissions increases from a project
remain below the relevant significant
rate for a specific regulated NSR
pollutant.
As we explained in the Background
Section, our regulations define a ‘‘major
stationary source’’ for purposes of PSD
as a stationary source that emits, or has
a potential to emit, at least 100 tpy, if
the source is in one of 28 listed source
categories, or, if the source is not, then
at least 250 tpy, of a regulated NSR
pollutant. CAA section 169. A ‘‘major
stationary source’’ for title V includes
sources that emit or have the potential
to emit above 100 tpy or more of any air
pollutant subject to regulation. CAA
sections 501, 302.43 We refer to these
100 or 250 tpy amounts as the major
source applicability thresholds. These
thresholds are computed on a massbasis for each regulated NSR pollutant
or title V air pollutant.
Because the definition of major
stationary source relies, in large part on,
a source’s ‘‘potential to emit,’’ the
definition of ‘‘potential to emit’’ is
extremely important in determining the
43 As explained in the Tailoring Rule, while the
statutory provision addresses any air pollutant, we
have historically applied the PSD and title V
programs only to pollutants subject to regulation.
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applicability of PSD and title V for a
particular source. The PSD regulations
define PTE as:
The maximum capacity of a stationary
source to emit a pollutant under its physical
and operational design. Any physical or
operational limitation on the capacity of the
source to emit a pollutant, including air
pollution control equipment and restrictions
on hours of operation or on the type or
amount of fuel combusted, stored or
processed, shall be treated as part of its
design if the limitation or the effect it would
have on emissions is federally enforceable.44
40 CFR 52.21(b)(4), 51.165(a)(1)(iii),
51.166(b)(4). The title V regulations are
similar. 40 CFR 70.2.
If a source has no practicably
enforceable emissions limitations that
restrict the amount of a pollutant the
source may emit, and the source has no
restrictions on its capacity utilization or
hours of operation, we require the
source to use its highest expected
emissions rate and ‘‘assume operation at
maximum design or achievable capacity
(whichever is higher) and continuous
operation (8760 hours per year)’’ to
compute its potential to emit.45 Thus, if
a source will actually emit below its
maximum capacity to emit, a synthetic
minor limitation can play an integral
role in limiting the source’s PTE to a
level below this maximum level. If the
source accepts legally and practicably
enforceable limits and requirements
sufficient to limit its PTE, that source
can be treated as a minor source, rather
than a major source, for purposes of our
regulations.
Synthetic minor limitations are also
important for determining whether a
project will result in an emissions
increase that exceeds the significant rate
for a regulated NSR pollutant, thus
triggering PSD permitting requirements.
While the significant rate for GHGs is
currently zero tpy, thus making this
type of synthetic minor limit less
practical for GHG sources, the methods
used to determine such emission
increases are applicable to GHGs
because they are also used to determine
whether GHGs are ‘‘subject to
44 40 CFR 52.21(b)(4). Following two court
decisions, National Mining Association v. EPA, 59
F.3d 1351 (DC Cir.1995) and Chemical
Manufacturers Ass’n v. EPA, No. 89–1514 (DC
Cir.1995), we clarified that the term ‘‘federally
enforceable’’ should be read to mean ‘‘federally
enforceable or legally and practicably enforceable
by a state or local air pollution control agency.’’
Release of Interim Policy on Federal Enforceability
of Limitations on Potential to Emit, at 3 (Jan. 22,
1996).
45 See Memo from Terrell E. Hunt, Associate
Enforcement Counsel Air Enforcement Division
Office of Enforcement and Compliance Monitoring,
and John S. Seitz, Director Stationary Source
Compliance Division Office of Air Quality Planning
and Standards, June 13, 1989.
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regulation.’’ To compute whether a
project will result in a ‘‘significant
emissions increase’’ under the federal
PSD regulations, a source has the option
of using either ‘‘projected actual
emissions,’’ or PTE to estimate postchange emissions. A source opting to
use PTE can reduce the amount of its
PTE by accepting legally and practicably
enforceable limitations on its
operations. To compute whether a
project will result in a ‘‘significant net
emissions increase,’’ a source must
compute emissions increases from
projects that occur during the
contemporaneous period. A creditable
emissions increase is computed by
comparing ‘‘baseline actual emissions’’
to the unit’s post-change PTE. A
permitting authority can use a synthetic
minor limitation to limit an emissions
unit’s post-change PTE to reduce the
amount of emissions increase that is
creditable in a net emissions increase
analysis. In computing a creditable
emissions decrease, a source may only
take credit for an emissions decrease
that is legally and practicably
enforceable. Thus a reviewing authority
can use a synthetic minor limitation to
create a creditable emissions reduction.
40 CFR 52.21(b)(3)(vi)(b).
We call any permit used to restrict a
source’s PTE below either the major
stationary source threshold or below the
significant rate a ‘‘synthetic minor
permit.’’ We call a source that accepts
limitations on its operations a
‘‘synthetic minor source.’’ This is in
contrast to a ‘‘true’’ or ‘‘natural minor’’
source, which is a source whose PTE
remains below the threshold without
any additional restrictions on the
source. Again, because the major
stationary source threshold and
significant rate are mass-based for all
non-GHG regulated NSR pollutants and
title V air pollutants, synthetic minor
limitations, historically, have reduced a
source’s mass emissions.
3. What is a ‘‘subject to regulation’’
limitation?
A ‘‘subject to regulation’’ synthetic
minor limitation is unique to the GHG
permitting programs. Instead of
allowing a source to avoid the PSD or
title V permit programs by establishing
PTE limitations that reduce tpy mass
emissions, a ‘‘subject to regulation’’
limitation reduces CO2e-based GHG
emissions. This unique type of limit is
specific to GHGs, because of the unique
way in which the EPA regulated GHG
emissions through the Tailoring Rule.
As we explained in the Background
Section, a source must meet two
applicability requirements to trigger
PSD permitting requirements for GHGs:
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(1) It must emit GHGs in amounts—
calculated on a CO2e basis—that make
GHGs ‘‘subject to regulation,’’ 46 and (2)
it must also emit GHGs in amounts—
calculated on a mass basis—that qualify
as a major stationary source (e.g., 100 or
250 tpy) and, if relevant, qualify as a
major modification (e.g., net emissions
increase of more than 0 tpy). For title V,
GHGs are ‘‘subject to regulation’’ at a
stationary source that emits or has the
potential to emit 100,000 tpy CO2e. A
‘‘subject to regulation’’ limitation
prevents a source from emitting GHGs
in amounts that exceed the relevant
‘‘subject to regulation’’ applicability
threshold that we established in the
final Tailoring Rule. Accordingly, just
like other synthetic minor limitations, a
source that complies with a ‘‘subject to
regulation’’ limitation can avoid
triggering PSD or title V GHG permitting
requirements.
As noted previously, in the Tailoring
Rule, although the EPA amended the
definition of ‘‘subject to regulation’’ to
establish a level of GHG emissions that
a source must meet, on both a source
and project basis, before GHGs will be
considered an NSR regulated pollutant
for PSD permitting purposes, the EPA
also made clear that its action had the
same substantive effect, and should be
treated, as having revised other
components of the definition of ‘‘major
stationary source’’ to achieve the same
effect. Even so, because in the Tailoring
Rule it was the ‘‘subject to regulation’’
provision that the EPA chose to
incorporate the phase-in thresholds, in
this proposal concerning PALs, the EPA
is continuing to focus on the ‘‘subject to
regulation’’ provision as the codification
of the Tailoring Rule requirements, to be
consistent with the approach in
Tailoring Rule.
Like the major stationary source
applicability threshold, the ‘‘subject to
regulation’’ threshold relies on the
concept of PTE. And like the major
modification significant rate, the subject
to regulation threshold also relies on
PTE to compute changes in GHG
emissions at the source. Accordingly,
the EPA proposes to create new
regulatory language to affirm the EPA’s
and other reviewing and permitting
authorities’ ability to establish
limitations on a source that prevent a
source from emitting GHG emissions
above subject to regulation thresholds
on a source-wide basis or for individual
modifications.
Because we are not proposing to
amend the regulatory definition of PTE,
consistent with the EPA’s current
46 Previously in this preamble we refer to the twostep phase-in thresholds 75 FR 31516.
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policy, we will recognize legally and
practicably enforceable restrictions for
determining whether a source’s PTE is
below the subject to regulation
threshold and for determining whether
an individual modification is below the
subject to regulation threshold. As with
limitations on ‘‘potential to emit’’ in
traditional synthetic minor permits
under our current policy, these
restrictions need not be federally
enforceable as long as they are
enforceable by the permitting
authority.47
4. Why does the EPA need authority to
issue synthetic minor source permits?
In general, the EPA does not have a
federal permitting program for minor
sources. Although the EPA recently
finalized a minor NSR permitting
program for Indian country, that
program did not affect permitting
outside of Indian country or include
regulation of GHG emissions.48 The EPA
is now the GHG permitting authority in
areas subject to a PSD FIP, including
Indian country, but does not have a
generally applicable minor source
permitting program that the EPA can
use to restrict GHG PTE for sources that
might want to request voluntary
limitations to avoid PSD permitting for
GHGs.49 In these areas it is not clear
whether sources will be able to obtain
synthetic minor limits for GHGs from
states or local permitting authorities
through other permitting mechanisms,
or through any other cognizable
mechanisms for establishing a synthetic
minor limit. Without a federal synthetic
minor permitting program for GHGs, a
source that would be subject to PSD
permitting requirements because of a
project’s potential GHG emissions, but
that would be willing to reduce
emissions from the source or project to
avoid those requirements, might not
47 We may alter this policy in final response to
address the Courts’ decisions in National Mining
Association v. EPA, 59 F.3d 1351 (D.C. Cir.1995)
and Chemical Manufacturers Ass’n v. EPA, No. 89–
1514 (D.C. Cir.1995).
48 See 76 FR 38748 (2011) (promulgating Tribal
minor source rule).
49 The EPA recently increased the number of
areas in which it is the PSD permitting authority.
On December 30, 2010, the EPA imposed a partial
PSD FIP for GHGs in some jurisdictions in the
Action to Ensure Authority to Issue Permits Under
the Prevention of Significant Deterioration Program
to Sources of Greenhouse Gas Emissions: Federal
Implementation Plan. Once that FIP became
effective, the EPA became the GHG PSD permitting
authority for seven states: Arizona: Both Pinal
County and Rest of State (excluding Maricopa
County, Pima County, and Indian Country),
Arkansas, Florida, Idaho, Kansas, Oregon, and
Wyoming. In addition, the EPA has long been the
PSD permitting authority in a few other states, in
Indian country, and in some areas of the Outer
Continental Shelf.
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have a viable permit mechanism for
committing to these emissions
reductions and making them
enforceable. Thus, we are proposing to
fill this gap in federal regulatory
authority, because we believe doing so
is important to our GHG phase-in efforts
and permitting authorities’ ability to
manage their GHG permit workload
(including our ability to efficiently issue
GHG permits), and because we believe
that synthetic minor limitations for
GHGs can result in increased
environmental benefit.
We believe that synthetic minor limits
for GHGs provide a valuable mechanism
to help manage GHG permitting burden
and potentially reduce GHG emissions,
and that such limits should generally be
available as an option for sources that
would prefer to take a legally and
practicably enforceable limitation on
GHG emissions in order to avoid major
source permitting requirements. Before
the Tailoring Rule, state and local
reviewing authorities predominantly
issued synthetic minor permits to
sources, even when the EPA was the
permitting authority for the PSD
permits. State and local agencies used
their SIP-approved minor NSR permit
authority, or in some instances their
Part 70 permit authority or their
federally enforceable state operating
permit program, to issue permits to a
source that requested synthetic minor
permit restrictions. Recently, the EPA
assumed GHG PSD permitting authority
for a number of jurisdictions.50 In many
of these jurisdictions, as well as
jurisdictions in which the EPA has long
been the PSD permitting authority, state,
local and tribal agencies may lack
mechanisms to create restrictions on a
source’s potential to emit GHG
emissions. This could occur if their
minor NSR program regulations do not
include GHG emissions or perhaps if it
only includes GHG emissions on a mass
basis, and if they do not have any other
legal mechanism under which they
could issue a synthetic minor limit for
GHGs. As we noted in the proposed
Tailoring Rule, states may but are not
required to regulate GHG emissions
through their minor NSR programs.
Accordingly, if a gap in minor NSR
permitting authority exists it may
continue to exist. On the other hand,
these states may have other viable
mechanisms for issuing synthetic minor
limits for GHGs, which might alleviate
the potential synthetic minor permitting
gap.
To better understand the extent of
state, local and tribal authorities’
synthetic minor GHG permitting
50 See
FN 33 above.
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authority, we request comment on
whether there is a minor source
permitting gap in areas subject to EPA
permitting authority for PSD permits for
GHG. For each state in which the EPA
is the GHG PSD permitting authority,
we request information on the states’
current efforts to interpret or amend
their minor NSR permit authority to
include GHG emissions, and on other
mechanisms that may be available to
create synthetic minor limitations on a
source’s GHG emissions. If there is a gap
in either permitting authority or
available mechanisms for issuing
synthetic minor permits for GHGs, we
request input on how that gap could
best be filled. We are also requesting
comment on whether there are sufficient
permitting mechanisms and permitting
authority to create GHG synthetic minor
limitations in areas subject to a SIPapproved PSD permit program for
GHGs. If a gap exists outside of federal
GHG PSD permitting areas, we request
suggestions for ways to address that gap.
5. What are the benefits to a federal
GHG synthetic minor permit program?
A federal GHG synthetic minor permit
program will increase EPA’s GHG
permitting capacity and provide
valuable knowledge and experience that
the EPA can use to develop effective
streamlining methods that assist in the
EPA’s phase-in of the GHG PSD and title
V permit programs to statutory levels. It
will also assist the EPA in managing the
GHG permit workload for sources
already potentially subject to permitting
at existing applicability thresholds, and
may result in enhanced environmental
protection compared to permitting a
source as a major source through PSD
and/or title V.
We believe that creating federal
authority to issue synthetic minor
permits to restrict a source’s GHG PTE
will decrease the long term permit
burden on the EPA (and eventually
reviewing and permitting authorities if
they assume the role for PSD and/or title
V permit issuance) by allowing sources
to avoid PSD permitting when their
actual emissions will not exceed the
major source applicability threshold and
the subject to regulation thresholds. In
addition, such federal authority could
reduce state and federal title V
permitting burdens, because a PTE limit
may be structured in such a way that it
also allows a source to avoid the need
to undergo title V permitting. We
believe that the cost and level of burden
for sources applying for a synthetic
minor permit, and for permitting
authorities to issue the permit, are
generally far lower than issuing either a
PSD permit or a title V permit. We
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request information about permitting
authorities’ and sources’ experiences in
this regard.
Moreover, the ability to apply for
synthetic minor permits can result in
greater environmental benefits than
those obtained through a PSD permit,
because it creates an incentive for
sources to reduce emissions to levels
below the applicability thresholds. For
example, to accommodate a need for an
increase in capacity, suppose a source
has the option of either modifying an
old, inefficient existing emissions unit
to increase its capacity, or adding a new,
high efficiency, lower emitting
emissions unit. Under the federal PSD
regulations, the post-change emissions
for a new emissions unit are equal to
that unit’s PTE, while the source may
use the projected actual emissions to
estimate post-change emissions for the
existing emissions unit. Suppose the
source only operates 16 hours a day. If
the source modifies an existing
emissions unit, it may project its
emissions using the anticipated 16
hours of operation. In contrast, unless
the source can obtain a legally and
practicably enforceable restriction on its
hours of operation, to determine its PTE,
it must calculate emissions for the new
emissions unit assuming a full day (24
hours) of operation. As a result, PSD
may be triggered for the addition of the
new emissions unit, while PSD may not
be triggered for the modification of the
existing unit. Depending on the cost of
emissions controls, and the delay in
obtaining the preconstruction permit,
the source may choose to modify its
existing emissions unit, rather than
install the environmentally preferable
new emissions unit if it cannot obtain
a PTE limit. Providing the EPA the
ability to issue synthetic minor permits
for GHG emissions gives the EPA a tool
to avoid this outcome.
Finally, because we believe that
synthetic minor permits generally
require fewer administrative resources
than full PSD permitting, establishing
this synthetic minor program allows
permitting authorities to focus greater
resources on larger sources that, for
whatever reason, cannot or do not want
to restrict the emissions to lower levels.
Accordingly, for all the reasons
described here, as part of the EPA’s
effort to phase-in the permitting
requirements for GHGs, the EPA
proposes to add authority to issue
synthetic minor permits to sources for
which the EPA, or its delegated agent,
is the GHG PSD permitting authority.
We propose to add the authority to issue
CO2e-based synthetic minor permits to
sources whose potential emissions are
above the statutory major source
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threshold (i.e., 100 or 250 tpy GHG) on
a mass basis or the subject to regulation
thresholds on a CO2e basis.
We request comment on our
conclusion that a federal synthetic
minor permit program will assist in the
EPA’s efforts to phase-in the GHG
permit program and efficiently manage
its GHG permitting resources. We also
request comment on our conclusion that
synthetic minor permits can achieve
enhanced environmental protection.
We also note that a synthetic minor
limit on GHG emissions could further
reduce administrative burdens under
the title V permitting program for two
reasons. First, as long as the title V GHG
applicability threshold is equal to or
higher than the PSD threshold, any
synthetic minor limit that establishes
GHG emissions below the PSD
threshold would also prevent such
sources from becoming title V sources
based on their PSD major source status
and/or applicable PSD requirements for
GHGs. Second, if the synthetic minor
permit restricts GHGs below the subject
to regulation threshold for title V, such
sources would not qualify as title V
sources because of their GHG emissions
alone. Of course, if such a source
qualifies as a title V source based on
their emissions of a non-GHG pollutant
or based on title V applicable
requirements, that source would still be
required to comply with those title V
obligations, regardless of the synthetic
minor limit for GHGs.
6. What is the legal rationale for EPA’s
GHG synthetic minor source permitting
authority?
Our authority to issue GHG synthetic
minor permits arises from the fact that,
but for the Tailoring Rule, the sources
eligible for this type of permit would
qualify as ‘‘major emitting facilities’’
under CAA section 169 because they
emit or have the potential to emit more
than 100 or 250 tpy GHGs on a mass
basis, depending on the source category.
As a result, we interpret CAA section
165 to convey to PSD permitting
authorities, including the EPA, the legal
authority to issue preconstruction
permits to these sources. We note that
we do not expect that sources at or near
the 100/250 tpy levels would seek such
permits at this time, since such sources
are unlikely to trigger PSD under the
current applicability tests. Instead, we
expect that larger sources would avail
themselves of this option.
Although CAA section 165 by its
terms authorizes the EPA to issue
permits to major sources, and sources to
whom we issue a GHG synthetic minor
source permit are, in many instances,
not major sources, we propose that
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under the present circumstances, CAA
section 165 authorizes the EPA to issue
these permits. As noted, these sources
would be major sources but for the
Tailoring Rule, and as explained in that
rule, the administrative burden
associated with immediately
implementing the PSD program at
statutory levels for GHGs would have
crippled the program. Thus, we decided
to tailor the program and phase-in the
permitting requirements to ensure that
the PSD permitting program would be
administrable for GHGs. Similar to the
approach in the Tailoring Rule, we view
the GHG synthetic minor program as
another tool to help ensure that the PSD
program for GHGs can be administered
in an effective and efficient manner.
Because the GHG synthetic minor
program will have those effects, CAA
section 165 may be read to authorize it.
CAA section 301(a)(1), which authorizes
the Administrator ‘‘to prescribe such
regulations as are necessary to carry out
his functions under [the CAA],’’
provides additional authority.
7. What changes would EPA make to the
PSD regulations to allow EPA to issue
GHG synthetic minor permits?
We are proposing to change both the
federal PSD permitting program in 40
CFR 52.21 and the federal minor NSR
program in Indian country in 40 CFR
Part 49. For the federal PSD permitting
program, we propose to add a new
§ 52.21(dd) to the existing PSD
regulations. The proposed regulatory
provisions are similar to the
requirements we established in Indian
country in 40 CFR Part 49, most
particularly at 40 CFR 49.158. The
proposed provisions address permit
application and permit content
requirements, as well as requirements
for monitoring, recordkeeping and
reporting, and public participation. We
request comment on any additional
provisions that may be needed to
establish a GHG synthetic minor
permitting program in 40 CFR 52.21,
and on any additional changes to the
proposed regulatory text that might be
required. In addition, we request
comment on a number of specific
provisions of the proposed regulatory
language relating to the definition and
use of an emissions limitation (using the
phrase ‘‘which has the effect of
limiting’’ instead of the terms limit(s) or
limitation(s) in proposed provisions
52.21(dd)(2)(i), (5)(ii)(b), and (5)(v)(a));
two options for addressing the
determination of application
completeness (see different deadlines
and processes for finding completeness
in proposed provisions 52.21(dd)(4)(ii)
and (iii)); and the appropriate
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procedures, if any, to include for
administrative review (see proposed
provisions 52.21(dd)(4)(vii) and (7)(iv)).
Finally, we would also amend the
existing regulations in Part 49 to ensure
that we have synthetic minor permitting
authority for GHG sources located in
Indian country. Amending our existing
minor source authority for Indian
country to add GHG synthetic minor
authority would retain all synthetic
minor authorities for Indian country
within one rule. We believe this would
be easier for sources in Indian country
to implement, but we request comment
on whether we should instead limit the
proposed changes to only 40 CFR 52.21.
C. Redefining Potential To Emit and
Source Category Specific PTE
This section discusses our current
thinking on developing category specific
PTE rules or guidance and requests
comment on the appropriate categories
and requirements. In addition we are
also exploring a novel approach that
would provide an individual source, in
any of multiple source categories, a way
to obtain streamlined, as well as legally
and practicably enforceable restrictions,
on the source’s hours of operation. We
outline and request comment on a
potential approach for creating such a
rule; however, we do not intend to
finalize this approach in this
rulemaking.
As explained in the Tailoring Rule,
because the PSD and title V
applicability are based on PTE, rather
than on actual emissions, they could
sweep enormous numbers of sources
into the PSD and title V programs even
though those sources’ actual emissions
are far below the applicability
thresholds. For example, sources that
operate for only part of the year, but that
have no legally and practicably
enforceable limitation on their operating
hours, must calculate their PTE on the
basis of the amount of emissions that
would result if those sources did
operate, and therefore emit, on a yearround basis (8760 hours per year). Our
proposed synthetic minor rule would
give sources the option to accept legally
and practicably enforceable limits on
their operations by, for example,
agreeing to limit the hours the sources
operate and complying with
recordkeeping, monitoring, and
reporting requirements to ensure that
these limits are enforceable as a
practical matter. As we have explained,
the issuance of synthetic minor permits
to individual sources benefits the GHG
phase-in program, but we would like to
continue to explore methods that can
reduce the number of individual
permits a reviewing or permitting
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authority need to issue. Therefore, in
addition to individual minor source
permitting, we continue to explore
adopting, or encouraging state
permitting authorities to adopt, rules for
source categories that we expect include
large numbers of sources whose actual
GHG emissions are well below
applicability thresholds, but which,
absent legally and practicably
enforceable limitations, have PTE above
those thresholds.
As we noted in our proposed
Tailoring Rule, the first step necessary
to develop a source specific PTE
regulation or guidance is to identify
source categories that are generally
conducive to a streamlined PTE
approach. 74 FR 55321. In selecting one
or more source categories, one
consideration is how to address the
possibility that the GHG applicability
thresholds could change in the future.
Today, we have more information on
sources with a potential to emit 100,000
tpy or more CO2e, and may be better
situated to propose a source category
specific PTE rule for a one of these
source categories, in the nearer term. We
have less information about smaller
sources, and developing a PTE rule will
require significant additional
information collection, and technical
analysis.
Source category PTE rules or guidance
continue to offer the opportunity for
reducing administrative and permitting
burden related to sources of all sizes.
We are broadly soliciting information on
source categories with sources at all
levels of emissions, ranging from
sources with actual emissions below the
PSD and title V statutory thresholds to
those that are just below the Steps 1 and
2 thresholds or the thresholds under
consideration for this rulemaking.
Therefore, we request comment on all
source categories that would be
candidates for creation of a PTE-specific
rule or guidance. Candidates include
source categories that currently have
PTE substantially higher than their
actual emissions, so that, if we were to
revise the thresholds to fall below their
PTE but remain above their actual
emissions, a rule or guidance that
adjusted how sources in those source
categories calculate PTE could allow
them to fall below the revised
thresholds. For instance, we request
comment on the usefulness of a PTE
regulation for natural gas fired boilers
that use a limited amount of fuel. As
another example, we solicit comment on
whether this approach might be useful
for sources whose only emissions units
are metered, natural-gas fired units with
actual GHG emissions below the
relevant applicability thresholds, which
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because of their metering are able to
track and determine their GHG
emissions on a continuous basis. This
option would essentially allow sources
to determine PTE with reference to their
actual emissions based on actual fuel
use. Conceptually, this option would
likely be available for such metered
sources that have historically always
had emissions below the applicability
thresholds and that will maintain and
operate their meters on a going-forward
basis. For such sources, actual GHG
emissions can be continuously
determined by monitoring their fuel use
so that they remain below the
applicability thresholds, as well as
comply with recordkeeping and
reporting requirements.
For any source category identified in
comments, we specifically solicit
information on how the source category
should be defined, typical hours of
operation over a year and whether those
vary by, for example, season, production
cycle, or over a day, and information on
typical emissions. We specifically
request input on what sorts of GHGemitting source categories may only
operate seasonally or otherwise have a
limited production time—e.g., limited
number of shifts, operate only during
day-time hours, operate only in the
evenings, or emit emissions only from
heating during winter months—or have
physical restrictions on their operations
that might make them well suited for a
PTE rule or guidance. We request
comment on the time period that
reflects these sources’ maximum
historical operations, which we could
use to establish, whether through
guidance or rulemaking, the PTE for
sources in those source categories. We
also solicit comment on what type of
documentation would be necessary to
demonstrate that sources in a source
category have a history of limited
operations. For example, would it
suffice for sources to demonstrate a 5 or
10 year history of limited actual hours
of operation? Suppose a representative
set of sources in a source category has
records documenting that they operated
only two, 8-hour shifts at their facilities
for the past 10 years, and that when
workers are not working, emissions
units are not running. Alternatively,
suppose a representative set of sources
in a source category has records that
show that they only operate during
summer months, and that the longest
they have operated in the summer is for
4 months. In such circumstances, could
the EPA interpret, through guidance or
rulemaking, PTE for sources in that
source category to reflect that maximum
level of actual operation?
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We are also exploring the
development of a streamlined method
that reduces the permitting burden for
sources that have historically operated
with reduced hours of operations and
are willing to accept an hourly limit at
or below the maximum level of
historical operation. The purpose of
such a rule would be to create a legal
mechanism by which sources in at least
certain types of source categories could
take legally and practicably enforceable
limits on hours of operation without
having to go through the more
burdensome process of obtaining
individual synthetic minor permits.
Rather, we contemplate that under such
an approach, a source would report and
document its historical maximum hours
of operation to EPA in some way, and
accept a legally and practicably
enforceable limit to operate at or below
that level, along with obligations
designed to ensure enforceability, such
as recordkeeping, reporting, and
monitoring requirements.
In order to develop our thinking on
this new approach, we are asking for
comment on several specific issues. We
request comment on whether such a
rule would be helpful to permitting
authorities in reducing GHG permit
burden. In addition, we request
comment on whether hours of operation
is an operating parameter that does not
need source specific limitations to
assure compliance. Have permitting
authorities included hours of operation
restrictions in numerous synthetic
minor permits? What success or
difficulties have permitting authorities
experienced in enforcing hours of
operation restrictions through synthetic
minor permits? Have terms and
conditions of such permits been
uniform within or between source
categories?
Additionally, we are requesting input
on whether such a rule should target
specific source categories, or be made
broadly available to all source
categories, and on what types of GHGemitting source categories may only
operate seasonally or have a limited
production time. We request comment
on the appropriate structure and
requirements for such a rule. What sorts
of application requirements, permit
limits, and recordkeeping, monitoring,
and reporting have permitting
authorities required for such hourly
limits? What time period adequately
reflects maximum historical operations,
for purposes of determining a restriction
on future operations?
We also request comment on
mechanisms the rule should provide to
ensure that the source does not exceed
any limitation on hours of operations
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that it agrees to accept. Finally, we
request comment on whether such a
process can be rigorous enough to
maintain the necessary integrity in PTE
calculations, and made legally and
practicably enforceable through
reporting, monitoring, and ongoing
recordkeeping requirements, but
streamlined when compared to the
burden of issuing and obtaining an
individual synthetic minor permit.
Again, we are just requesting
comment in this action on the idea of
developing a rule to voluntarily restrict
hours of operation across multiple
source categories and we are not
proposing a specific rule at this time. If,
after reviewing comments, we
determine that this is a viable approach
for streamlining GHG permitting, we
may proceed to propose a specific rule
in the future.
D. General Permitting for GHGs
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1. What is a general permit?
A general permit is a permit that the
permitting authority adopts once and
then applies identically to each source
that requests coverage and meets the
specific eligibility requirements.
General permits are best suited for the
regulation of sources that perform the
same or similar operations, emit similar
air pollutants and are subject to the
same limitations, standards and
requirements. General permits are a
mechanism that provides for greater
efficiency in issuing required permits,
thereby saving costs to both the source
and the permitting authority.
As noted in the following, some states
have programs that authorize general
permits. These programs show very
clearly that there are benefits to using
general permits. The issuance process
for the permit is relatively simple and
streamlined. The applicable
requirements for these sources have
already been identified for the applicant
in both the application and the permit.
The applicant knows, prior to
application submittal, what conditions
the permit will contain. In addition,
public review is simplified. The public
review process for general permits
occurs before the general permit is
finalized, rather than on a permit by
permit basis.
In the context of GHG, the issuance of
PSD or title V general permits would
promote more efficient treatment of
GHG-emitting sources that would be
subject to permitting, and allow the
expeditious expansion to more GHGemitting sources while protecting those
sources and the permitting authorities
from undue burden.
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2. What is the Legal Authority for
General Permits?
The CAA gives the EPA the authority
in section 504(d) to issue general
permits for title V sources, and the EPA
has regulations in place to create general
permits for title V sources. Although
there is no provision in the CAA that
expressly authorizes the use of general
permits in the PSD program, the DC
Circuit, in the Alabama Power case,
recognized that ‘‘[c]onsiderations of
administrative necessity may be a basis
for finding implied authority for an
administrative approach not explicitly
provided in the statute’’ and expressly
identified general permits as an
alternative to the exemptions that were
at issue in that case. See 636 F.2d at 360.
Further, courts have recognized the
EPA’s authority to use general permits
under section 402 of the Clean Water
Act without an express provision
authorizing such general permits.
Environmental Defense Center v. EPA,
344 F.3d 832, 853 (9th Cir. 2003)
(‘‘General permitting has long been
recognized as a lawful means of
authorizing discharges.’’) (citing NRDC.
v. Costle., 568 F.2d 1369, 1381 (DC Cir.
1977)); NRDC. v. Train., 396 F. Supp.
1393, 1402 (D.D.C. 1975) (The EPA has
‘‘substantial discretion to use
administrative devices, such as area
permits, to make EPA’s burden
manageable.’’).
3. Have the states used general permits?
Many states have taken advantage of
the ability to use general permits. In
reviewing state programs, we have
found that though the concepts are
similar, the structure and content of the
various programs is quite diverse. For
example, the New Jersey Department of
Environmental Protection (NJDEP) has
developed a general permit program
(GP–017) 51 that allows for the
construction, installation,
reconstruction, modification and
operation of boilers and heaters less
than 5 MMBTU/hour. NJDEP defines a
general permit as a pre-approved permit
and certificate which applies to a
specific class of significant sources. By
issuing a general permit, NJDEP
indicates that it approves the activities
authorized by the general permit,
provided that the owner or operator of
the source registers with the Department
and meets the requirements of the
general permit. If a source belongs to a
class of sources which qualify for a
general permit and the owner or
operator of the source registers for the
general permit, the registration satisfies
51 https://www.state.nj.us/dep/aqpp/downloads/
gp17.pdf.
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the requirements of NJAC 7:27–8.3 52 for
a permit and certificate.
Ohio’s Division of Air Pollution
Control (DAPC) also has developed
model general permits-to-intall and
model general permits-to-install and
operate for select sources in Ohio. The
regulations for general permits can be
found in OAC Rule 3745–31–29. Ohio
states that a general permit is the same
as any permit-to-install or permits-toinstall and to operate that DAPC issues;
the only difference is that all the terms
and conditions of the permit have been
developed in advance. This is referred
to as the ‘‘model general permit.’’
Potential applicants can review the
model general permit qualifying criteria,
terms and conditions, and if they
believe they qualify, they can complete
the application and sign the qualifying
criteria document. The DAPC will
review the applicants’ information to
confirm that they meet the
qualifications, and then issue the
general permit to the applicants.
4. What steps has the EPA made toward
developing general permits?
In the context of streamlining the
permitting process for GHGs, the EPA is
considering various methods for
developing general permits. As a
procedural matter, the EPA is evaluating
the possibility of proposing an enabling
rule to enable the development of PSD
general permits for GHG emitting
sources. This rule would enable the EPA
to create and implement PSD general
permits for GHG emissions only for
selected source or emissions unit
categories. The enabling rule would lay
out the basic foundation for general
permits. It would identify the general
provisions that would be found in all
EPA-issued general permits, the criteria
and process for establishing a general
permit, and discuss the rationale and
legal basis for a PSD general permit for
GHGs. The enabling rule would also
establish the process for the creation of
general permits for the EPA’s use where
the EPA is the GHG permitting authority
and define mechanisms by which states
could leverage federal general permits to
streamline the permitting processes for
sources that would trigger PSD for only
their emissions of GHGs.
We are also considering the overall
criteria for determining the source or
52 The permittee shall not construct, reconstruct,
install, or modify a significant source or control
apparatus serving the significant source without
first obtaining a preconstruction permit under
N.J.A.C. 7:27–8. [N.J.A.C. 7:27–8.3(a)].
The permittee shall not operate (nor cause to be
operated) a significant source or control apparatus
serving the significant source without a valid
operating certificate. [N.J.A.C. 7:27–8.3(b)].
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emissions unit categories for which we
may develop the first general permits.
Our initial inclination, on which we
solicit comment, is that we should focus
first on GHG-only sources, that is, GHGemitting sources that do not emit nonGHGs in amounts that would be subject
to PSD requirements. This is because
complying with PSD for non-GHG
pollutants involves analyses and
demonstrations, such as a requirement
that the source demonstrate that the
proposed project will not cause or
contribute to a violation of any NAAQS,
which inherently are facility and
location specific. For GHGs, BACT is
the primary substantive PSD permitting
requirement, and we believe that BACT
can more readily be established for a
source or emissions unit category, thus
making the general permit approach
feasible for sources and modifications
that are major only due to GHG
emissions.
We are considering what source and/
or emissions unit categories would be
good candidates for the first general
permits. Even though natural gas-fired
boilers range from large high
performance boilers for industrial
applications to small commercial and
residential units for space heating and
hot water, sources for which the only or
predominant source of GHG emissions
are boilers may be good candidates for
PSD GHG general permits. Because
boilers are widely used throughout
industrial and commercial source
categories, and can readily be
categorized by design, purpose,
efficiency and emissions, they present
opportunities for significant
streamlining through the use of general
permits and thereby reductions in
administrative burden from PSD
permitting. Because the controls for
GHGs on natural gas-fired boilers are
sufficiently uniform, it seems possible
to identify standardized control
requirements to include in a general
permit without significantly
compromising environmental
protection.
Even so, it is unclear whether a
general permit rule, for boilers or other
emissions units, would be a productive
streamlining method for the source
categories and projects affected by this
Step 3 rulemaking. In many cases,
boilers or other equipment located at a
source or involved in a project will emit
non-GHG pollutants in amounts great
enough to trigger other significant CAA
requirements such as minor NSR,
NESHAP and/or NSPS, diminishing the
streamlining utility of a PSD general
permit for GHG only. We are also
mindful that implementation of a
general permit program would likely
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involve regulatory action and a SIP
revision at the state or local permitting
authority level, which in and of itself
imposes administrative costs, and the
limited benefits of a general permit
program for the source categories and
projects potentially covered in this Step
3 rulemaking could be offset by the
administrative costs of the SIP revision
process. Although we are concerned
that GHG general permits for boilers and
other common emissions unit categories
may not provide enough streamlining
value for the source categories affected
by this Step 3 rulemaking, we believe
such permits may have significant value
when we consider smaller sources,
especially those with no other emissions
units or non-GHG pollutants emitted at
significant levels. We are also
considering how to incorporate a
general permit for GHGs into existing
state permitting programs. We are
mindful that reviewing agencies
generally have construction permitting
processes that address all applicable
requirements, including minor NSR and
major NSR/PSD in an integrated
fashion. It would be important to
structure the general permit program so
as to avoid complicating or conflicting
with established permitting processes.
We are also considering further
questions, including: (1) Should general
permits be available to greenfield
sources?; (2) When issuing a general
permit for a project/modification what
do we do with pollutants other than
GHGs?; (3) Can general permits be
utilized for projects at any major source
or only at sources major only for GHGs?;
(4) Are general permits available to both
new and modified units?’’ (5) ‘‘Are
general permits mandatory or optional
for states?; (6) What is the process for
establishing general permits?; (7)
Should states or the public be able to
request that the EPA propose general
permits for source categories and
emissions units, and if so, what is the
process for this type of request?; (8)
What should the public participation
procedures be?; (9) What is the approval
or denial process for sources to use a
general permit?; (10) What would BACT
for a general permit look like?; (11) How
would BACT be established?; (12) How
would BACT be updated?; (13) What are
the Endangered Species Act and
environmental justice implications of
the general permit?; (14) Should there
be a periodic review of the general
permit’s provisions, and if so, what
would it look like?, and (15) Could we
develop a process for states to
incorporate a general permit program
into their SIPs in a way that minimizes
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the administrative costs of the SIP
revision process?
We commit to continue to explore the
possibility of general permits by
reviewing information that we expect to
receive in response to this proposal and
the information gathered by permitting
authorities through the implementation
of GHG permitting. We believe that
establishing general permits will require
collection of significant categoryspecific data for various source and
emission unit types as well as those that
have heretofore generally not been
regulated by the CAA (e.g., small
furnaces, water heaters, etc.), which
could take a significant amount of
resources and time.
We request comment on, in addition
to the issues described previously,
possible sources and source categories
that may benefit from general permits, if
such permits were only created for
addressing GHG emissions, as a
streamlining method to assist in the
phase-in of GHG permitting. We request
comment on the appropriate approach
for public review, in particular whether
public review of individual uses of a
PSD general permit can be satisfied
through public participation in the
development of the general permit itself
or whether each individual use of the
PSD general permit requires public
participation. We also request comment
on whether such a program should be a
required minimum element for SIP
approved PSD programs, as relevant.
5. General Permits and Title V
We expect many of the issues related
to PSD general permits would also be
relevant for title V general permits. For
example, we would expect title V
general permits to be most useful for
GHG sources that trigger title V
applicability due to boilers, but where
sources are subject to other
requirements, such as NSR, NESHAP
and/or NSPS, the utility of general
permits may be limited.
We request comment on experience
with title V general permits issued by
state and local permitting authorities,
including whether permitting
authorities have altered application
requirements pursuant to 40 CFR
70.6(d)(2), and other means of ensuring
that general permits met the goals of
title V for streamlined procedures and
assuring compliance. Finally, we
request comment on whether such a
program should be a required minimum
element for state Part 70 title V
programs, as relevant.
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E. Presumptive BACT for GHGs
1. Definition of BACT
The Act defines BACT as:
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* * * an emission limitation based on the
maximum degree of reduction of each
pollutant subject to regulation under this Act
emitted from or which results from any major
emitting facility, which the permitting
authority, on a case-by-case basis, taking into
account energy, environmental, and
economic impacts and other costs,
determines is achievable for such facility
through application of production processes
and available methods, systems, and
techniques, including fuel cleaning, clean
fuels, or treatment or innovative fuel
combustion techniques for control of each
such pollutant. In no event shall application
of ‘‘best available control technology’’ result
in emissions of any pollutant which will
exceed the emissions allowed by any
applicable standard established pursuant to
section 111 or 112 or this Act. Emissions
from any source utilizing clean fuels, or any
other means, to comply with this paragraph
shall not be allowed to increase above levels
that would have been required under this
paragraph as it existed prior to enactment of
the Clean Air Act Amendments of 1990.
CAA section 169(3).
Performing case-by-case BACT
determinations can be complicated,
resource-intensive and time-consuming.
In brief, the top-down BACT process
calls for all available control
technologies for a given pollutant to be
identified and ranked in descending
order of control effectiveness. The
highest-ranked (‘‘top’’) option(s) should
be established as BACT unless the
permit applicant demonstrates to the
satisfaction of the permitting authority
that technical considerations, or energy,
environmental, or economic impacts
justify a conclusion that the top-ranked
technology is not ‘‘achievable’’ in that
case. If the most effective control
strategy is eliminated in this fashion,
then the next most effective alternative
should be evaluated, and so on, until an
option is selected as BACT. This
analysis should be conducted for each
regulated NSR pollutant that is subject
to the BACT requirement in a given
case. The EPA has broken down this
analytical process into the following
five steps.
Step 1: Identify all available control
technologies.
Step 2: Eliminate technically
infeasible options.
Step 3: Rank remaining control
technologies.
Step 4: Evaluate most effective
controls and document results.
Step 5: Select BACT.
2. What is presumptive BACT?
Presumptive BACT is a potential
streamlining approach that involves the
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development of a standardized BACT
for certain emissions units. Presumptive
BACT would create ways for specific
categories of permitted emissions units
to move from a system under which
determinations are made on individual
permits on a case-by-case basis, to one
where BACT is determined for common
types of equipment, which could be
applied to individual permits with little
to no additional revision or analysis. In
general, the EPA believes that
presumptive BACT could be
implemented on a broad basis for
specific emissions units where there are
well defined and similar types of
emissions units, uniformity in process/
emissions unit design and function, and
well defined GHG control technologies.
Reviewing agencies could adopt
presumptive BACT, possibly including
model permit language and monitoring,
reporting and recordkeeping
requirements, to streamline the BACT
analysis for GHGs within their own
established permitting process.
The EPA has previously introduced
the concept of presumptive BACT to
streamline permitting for
desulfurization projects at refineries as
well as in other instances,53 and some
state permitting authorities have
adopted similar approaches.54 Based on
our understanding of the types of
sources that will become subject to PSD
if GHG emissions are regulated at levels
below the thresholds currently
contained in the Tailoring Rule, we
believe the presumptive BACT process
could offer significant streamlining
benefits. Such streamlining benefits
would arise because many of the
sources that would become subject to
BACT at lower GHG emission levels
will likely have very similar emissions
producing equipment, and we believe
there would be little variation across
sources with respect to the cost, energy
and environmental considerations in the
BACT decision.
As discussed in the following, the
EPA has expressed interest in soliciting
comments on the potential use of
presumptive BACT for GHG permitting.
It should be understood that
53 See Memorandum, ‘‘BACT and LAER for
Emissions of Nitrogen Oxides and Volatile Organic
Compounds at Tier 2/Gasoline Sulfur Refinery
Projects,’’ from John S. Seitz, Director, Office of Air
Quality Planning and Standards, to Regional Air
Division Directors (January 19, 2001).
54 For example, Wyoming has a minor source
permitting program that includes a BACT analysis,
and they use a presumptive BACT process for
issuing minor source permits to a particular source
category—oil and gas production facilities. See
Permitting Guidance for Oil and Gas Production
Facilities, Wyoming Dept. of Environmental
Quality, Air Quality Division (August 2007
revision).
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presumptive BACT would be only an
optional means to streamline the topdown BACT process by pre-evaluating
what could constitute BACT for specific
categories of similarly-situated
emissions units. It should also be
understood that this would only be
available to address the GHG emissions
from those units, and that the preconstruction permitting process would
not be affected in any other way.
Presumptive BACT would add
another option for sources to achieve
BACT requirements and provides
additional benefits for the source and
the permitting authority through
streamlining of the permit process. In
actual implementation, the choice of a
presumptive BACT option would
reduce burdens currently associated
with conducting individualized, topdown BACT analyses for each source
requiring a PSD permit. Nonetheless,
there are several considerations to
explore before we can implement a
presumptive BACT approach including
the role of presumptive BACT in a caseby-case decision framework, the role
and timing of public review, and
preserving BACT’s technology-forcing
role within a presumptive BACT
framework.
3. How the EPA Could Consider
Implementing Presumptive BACT
As noted previously, the CAA
requirement for BACT, found in section
165(a)(4), mandates that BACT
determinations be made for each
regulated pollutant on a ‘‘case-by-case
basis.’’ Accordingly, the EPA would like
to develop a process that benefits from
the efficiencies that presumptive BACT
would provide while allowing for
issuance of individual PSD permits. In
the proposed Tailoring Rule, the EPA
discussed potential options to explore
presumptive BACT as an alternative to
the current case-by-case nature of
conventional BACT. In that discussion
and in subsequent consideration by the
agency, two potential ways in which to
implement a presumptive BACT
program have emerged: As an
alternative method of completing a
BACT analysis in an individual
permitting action or as a way to
eliminate the need for an individualized
BACT analysis for all permits in a
particular category.
The first approach would develop,
through notice-and-comment
rulemaking or through permitting
guidance, a presumptive BACT level for
sources in a particular source category
that subsequently could be applied and
assessed in individual permitting
actions. Under such an approach, while
the top-down analysis for an individual
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permit would be fulfilled by a request
to include the presumptive BACT limit,
there would still be an opportunity for
permitting authorities and the public to
examine individual permits to assess
whether there are significant casespecific energy, economic, and/or
environmental impacts that would
require adjustment of the presumed
limit for that particular source. This
form of presumptive BACT would create
a rebuttable presumption that the
emissions covered by the particular
source’s BACT limit will, in fact, be
controlled to the maximum degree that
can be achieved. This presumption
shifts the burden to the permitting
authority or other interested parties to
produce credible evidence that the
application of presumptive BACT to
that particular source would not comply
with BACT requirements. If credible
evidence were produced, then the
source would either be required to
produce evidence sufficient to show
that the presumption is the best
achievable control technology or to
conduct an individualized top-down
BACT analysis. Whatever mechanism
the EPA may ultimately choose to
implement presumptive BACT, if any,
the critical and essential component of
a successful BACT analysis will
continue to be a strong record
supporting the decisions reached by the
permitting authority, as explained in the
PSD and Title V Permitting Guidance
for Greenhouse Gases (March 2011).
While such an approach could
streamline the BACT determination
process to some extent, we are
concerned that those streamlining
benefits could be negated given the
prospect that such presumptive BACT
determinations would, as a result of
permitting authority review and public
comment, still have to be reviewed for
numerous individual sources.
Accordingly, the EPA has also
considered a system in which
presumptive BACT levels for a specific
category of emissions units would be
developed through notice-and-comment
rulemaking but then applied to
individual sources in that category
without requiring permitting authorities
to individualize the BACT
determination or allowing for public
comment on whether presumptive
BACT levels should apply to an
individual source. While, as noted in
the following, some have argued that
such an approach would not strictly
adhere to the individual case-by-case
BACT determinations envisioned in the
CAA, even if that is the case,
maintaining case-specific BACT
determinations may well be impractical
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given the significant increase in new
sources that would likely be brought
into the PSD program when GHG
permitting thresholds are reduced.
Moreover, the DC Circuit, in the
Alabama Power case previously
discussed, stated that courts ‘‘frequently
uphold streamlined agency [regulatory]
approaches or procedures where the
conventional course, typically case-bycase determinations, would, as a
practical matter, prevent the agency
from carrying out the mission assigned
to it by Congress.’’ 636 F.2d at 358. The
Court recognized that such nonindividualized streamlining measures
may be needed when time or personnel
constraints or other practical
considerations ‘‘would make it
impossible for the agency to carry out its
mandate.’’ See id. at 359. A presumptive
BACT approach that does not require
individualized, source-specific
determinations could well be an
important tool to allow the EPA, state
and local permitting authorities to carry
out the PSD program in as timely and
efficient manner as necessary to
promote (rather than hinder) control of
GHG emissions from the many new,
small source categories that would be
required to have PSD permits based on
their GHG emissions. This approach
would preserve opportunities for public
participation by taking comment during
the determination of presumptive BACT
levels for a source category. Although
here too, some have argued that this
type of presumptive BACT approach,
one that does not require
individualized, source-specific
determinations, would depart from a
literal application of the statutory
requirements for BACT, even if that is
the case, it may nevertheless remain
closer to the congressional intent for the
PSD program in so far as it would
reduce administrative burdens in each
permitting action, thus allowing more
overall sources to become subject to a
PSD permitting program that moves
applicability thresholds closer to the
statutory levels.
We received many comments on
presumptive BACT during the public
comment period for the Tailoring Rule.
Many commenters supported the
concept of presumptive BACT as a
means to streamline PSD permitting.
Some noted that it would promote
consistency in BACT determinations as
various permitting authorities gain
experience with GHG permitting. Some
suggested that it would be useful for
common combustion sources, and at
least one indicated that it would be
particularly justified for natural gasfired equipment. Several included
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recommendations for specific industrial
sectors. A number of the supportive
commenters also recommended that the
source have the option to use
presumptive BACT or to conduct a caseby-case BACT determination.
Some commenters opposed
presumptive BACT. A few indicated
that it would not be flexible enough to
take into account source-specific factors.
Others asserted that it is contrary to the
requirements of the Act for a case-bycase BACT determination and
opportunity for public review. Some
noted that it would dampen the
technology-forcing role of BACT, and at
least one suggested a periodic update
not less than every 5 years.
The EPA requests comment on the
possible approaches to presumptive
BACT discussed previously. We request
comment on whether the first approach,
where each use of presumptive BACT
would be subject to permitting authority
review and public comment, would
offer significant streamlining value. We
also request comment on our legal
authority to implement each approach,
particularly on the applicability of
Alabama Power principles to the second
approach, which does not authorize
individualized, source-specific
determinations.
4. Possible Impediments to Presumptive
BACT
a. Public Comment Processes for
Presumptive BACT
The provision of effective and
meaningful opportunities for public
comment on BACT determinations is an
important element of air permitting
process provided for in the CAA. In the
context of the two presumptive BACT
approaches explained previously, the
EPA or a state agency could provide
opportunity for public participation
either in individual permitting actions
to allow the public to rebut the
presumption that a pre-determined
BACT limit applies to the specific
source under consideration, or in
determining the presumptive BACT
levels for a source category. The EPA
requests comment on the public
participation approaches that would be
appropriate to support presumptive
BACT determinations. For example, is it
sufficient to provide for public review
and comment only during the
rulemaking to establish a presumptive
BACT level or does the case-by-case
nature of BACT require comment for
individual permitting actions? Even if
we follow the approach of establishing
a presumptive BACT limit through
notice-and-comment rulemaking and
limiting public input on individual
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permitting actions, are there
circumstances in which public
comment might also be warranted for
those individual permitting actions the
presumptive BACT limit? If so, what are
they? If we follow the approach of
allowing public input on individual
permitting actions that use presumptive
BACT, are there ways in which the
public comment might be limited to
recognize more streamlining benefits?
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b. General Permits
The EPA is particularly interested to
consider pursuing presumptive BACT as
a streamlining approach in cases where
there would be similar BACT outcomes
in multiple permits due to similar
source characteristics and available
control options. General permits, which
are discussed in the previous section,
provide one context to implement this.
General permits are particularly useful
in situations where source operations
are highly consistent and relatively
simple across a source category. General
permits typically work best where
sources in the category are subject to the
same applicable air regulatory
requirements, including those
associated with criteria pollutant and air
toxics regulatory programs.
We are particularly interested to
consider opportunities to develop
presumptive BACT options to
complement potential general
permitting approaches addressing
GHGs. In the absence of a presumptive
BACT approach, general permits
addressing GHGs may have limited
streamlining value in light of case-bycase conventional BACT determination
needs. Accordingly, we request
comment on opportunities for using
presumptive BACT approaches in the
context of general permits. In addition,
we request comment on potential source
categories or types of emission units
that may be particularly well-suited for
a general permit and presumptive BACT
approach due to similarities in source
characteristics and available GHG
control options. We also request
comment on whether presumptive
BACT approaches for GHGs should be
considered for source categories and
types of emission units that may not be
feasible to address using a general
permit approach.
c. Updating of Presumptive BACT
In general, case-by-case BACT
determinations allow for the continual
evolution of BACT requirements over
time and are generally referred to as
‘‘technology forcing,’’ in so much as
available controls identified in prior
permits are considered in each
subsequent BACT determination and
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the specific facts of subsequent actions
may support application of a top-ranked
control technology that was eliminated
in prior actions. However, the EPA
recognizes that application of
presumptive BACT to a category of
sources over many permitting decisions
may diminish the technology forcing
effects of PSD. Updating of BACT is an
important concept to consider in the
context of developing a presumptive
BACT option, and the EPA is interested
in options that would help maintain
advances in control technologies.
As previously explained, the
conventional top-down BACT process
incorporates continual updating of the
BACT for each type of emission unit
through the analysis that occurs to
ensure that the most current BACT is
used. To provide streamlining
opportunities, the presumptive BACT
process would likely need to
incorporate some form of updating
mechanism to ensure that the BACT
remains current over time. We have
identified several different approaches
by which such updating could be
accomplished. One approach would be
for the EPA or a state agency to
periodically review and consider
updates to the presumptive BACT
option established for a certain source
category or type of emission unit. For
example, there could be a requirement
to update presumptive BACT on a set
time interval (such as every 3 or 5
years).
Another approach could be to link a
presumptive BACT determination to a
standard established through some
respected standard-setting programs so
that the presumptive BACT level would
automatically update periodically in
conjunction with updating process
already used in established standardsetting programs, as discussed in the
following examples. One option would
be for the EPA or a state agency to set
presumptive BACT at the same levels
used in equipment energy efficiency
standards established by government
agencies or other respected standardsetting bodies. For example, the U.S.
Department of Energy (DOE), pursuant
to the Energy Policy and Conservation
Act, promulgates energy efficiency
standards for industrial and commercial
boilers.55 These periodically-updated
equipment energy efficiency standards
could be used as the basis for
presumptive BACT in cases where such
standards exist. Similarly, it may be
appropriate to use ENERGY STAR
equipment certification as a basis for
55 https://www1.eere.energy.gov/buildings/
appliance_standards/residential/furnaces_
boilers.html.
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presumptive BACT. Whereas appliance
and equipment energy efficiency
standards usually provide the ‘‘ground
floor’’ requirements for performance of
new energy consuming equipment,
ENERGY STAR certification
specifications establish minimum
performance requirements for highefficiency, lower emissions equipment
within selected product categories. The
ENERGY STAR program, administered
by the EPA in partnership with the
DOE, establishes voluntary product and
equipment energy efficiency
specifications for certain products and
equipment in an effort to transform the
market for manufactured goods by
expanding the availability and visibility
of energy-efficient products.
Commercial and residential products
can earn the ENERGY STAR label by
meeting the energy efficiency
requirements set forth in ENERGY
STAR product specifications.
Accordingly, ENERGY STAR
equipment specifications include energy
efficiency performance requirements
that exceed DOE appliance and
equipment standards. For example, to
qualify for ENERGY STAR certification,
residential boilers must have annual
fuel utilization efficiency (AFUE)
ratings of 85 percent or greater.56 This
compares with DOE boiler energy
efficiency standards established in 2007
that range from 80 to 83 percent.57
The EPA requests comment on
approaches for ensuring that
presumptive BACT options are
periodically reviewed and refreshed. We
also request comments on the feasibility
and potential configuration of
approaches that connect presumptive
BACT to equipment energy efficiency
standards or certifications or other
external factors. In particular, it would
be helpful to receive comments on the
role DOE industrial equipment and
appliance energy efficiency standards
and/or ENERGY STAR certification for
industrial and commercial equipment
play in the context of presumptive
BACT. In addition to the specific
comments requested previously, the
EPA seeks overall comments on the use
of presumptive BACT, including
suggestions for how such limits could
be established, updated and used
consistently within the requirements of
the CAA, including requirements for a
top-down, case-by-case BACT
determination process. The EPA invites
comments on whether presumptive
56 https://www.energystar.gov/
index.cfm?fuseaction=find_a_product.showProduct
Group&pgw_code=BO.
57 https://www1.eere.energy.gov/buildings/
appliance_standards/residential/pdfs/furnaces_
boilers/furnaces_fr_111907.pdf.
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BACT options should be advanced
through rulemaking or through
guidance. Comments would also be
useful regarding considerations that
should affect whether presumptive
BACT approaches could be used to
address only existing units or new units.
The EPA also encourages comments on
the respective roles of state, local and
tribal air agencies relative to that of the
EPA in establishing presumptive BACT
options.
F. Title V Empty Permits
In the Tailoring Rule, we identified a
possible exclusion for ‘‘empty permits’’
(which are, as noted, permits issued to
a source that is not subject to any
applicable requirement for any
pollutant) as a potential means for
alleviating the potential burden of title
V permitting for GHG sources. In the
Tailoring Rule we described an ‘‘empty
permit’’ as ‘‘a permit issued to a source
that is not subject to any applicable
requirement for any pollutant.’’ 58
Empty permits may occur because the
applicability for title V is in part based
on major source status, yet there may
not be any applicable requirements that
apply. Since the principal purpose of
title V is to collect the requirements
applicable to the source and assure
compliance with those requirements it
is unclear whether Congress intended
sources, particularly smaller sources, to
be subject to title V permitting if there
are no applicable requirements for the
source. The EPA solicits comments on
whether we may, and should, interpret
title V as not requiring permits for
sources that are not subject to any
applicable requirements (as defined in
40 CFR 70.2). The EPA also solicits
comments on whether the EPA could
adopt such an interpretation through
guidance, an interpretative rule (without
notice and comment), or only through
notice and comment rulemaking, and
whether states would, or should, be
required to submit program revisions to
the EPA for approval in order to exclude
such sources from title V permitting.
In the Tailoring Rule, the EPA noted
that we anticipated very few if any
‘‘empty permits’’ as a result of Step 2.
However, there remains significant
uncertainty as to the number of ‘‘empty
permits’’ that would exist if the
Tailoring Rule thresholds were
significantly lowered. The EPA believes
that several SIPs contain generally
applicable requirements for sources that
58 Empty permits are different from ‘‘hollow
permits.’’ A ‘‘hollow permit’’ is a permit for a GHG
major source that does not contain requirements for
GHG emissions, but which contains other
applicable requirements for pollutants for which
the source is not major.
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would constitute ‘‘applicable
requirements’’ for many sources that
would become subject to title V solely
as a result of GHG emissions if the
thresholds were significantly lowered.
We noted in the final Tailoring Rule
that:
We need to gather more information
concerning the potential number and utility
of ‘‘empty permits’’ for GHG sources, in light
of the fact that the need for requirements in
title V permits will vary based on the
requirements of each SIP, and the fact that
some SIPs contain broadly applicable
requirements.
Tailoring Rule, 75 FR 31566. Thus, we
solicit comments, particularly from
states on these issues. For example:
What, if any, SIP requirements would
be applicable to sources that would
become subject to title V permitting
solely as a result of emitting GHG in
excess of a lower threshold?
What number (or proportion) of
sources potentially subject to title V
would be expected to have no
applicable requirements under the SIP
or other CAA programs?
Is there a threshold below which the
number of empty permits would
increase significantly, as a result of a
corresponding threshold in applicability
of SIP requirements?
VII. Request for Comment
We have requested comment
throughout this preamble on many
aspects of the GHG permitting program
and our proposed rulemaking. In this
section, we provide a summary of the
issues on which we are requesting
comment and refer the reader to the
preceding sections for our requests on
more specific points.
A. Solicitation of Comment on Proposed
Step 3
1. General
We solicit comment on all issues
described previously in section V of this
preamble. In particular we solicit
comment from the states as to their
current and expected air permit budgets
as well as their current and expected
future levels of permitting.
In addition, we solicit comment on
promulgating lower GHGs thresholds for
PSD applicability and on promulgating
lower GHGs thresholds at any levels we
have analyzed in this rulemaking for
PSD and title V applicability.
Commenters advocating lower
thresholds should support their position
with data demonstrating that the
permitting authorities have developed
the capacity to handle the current and
future permitting volume under the
existing thresholds, and will be able to
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handle the additional permitting
volume, in a timely manner, that would
be required at reduced thresholds.
Commenters should also be able to
support their positions with data
demonstrating that sources have the
ability to meet the requirements of the
PSD program.
We note that in this rulemaking, we
are not re-opening or soliciting
comment on the Tailoring Rule’s
decision to phase in the thresholds, to
begin with the Steps 1 and 2 levels, or
the legal or policy basis for the Tailoring
Rule. By the same token, as noted
previously in section V, in this
rulemaking, we are relying on the same
methodology used in the Tailoring Rule
to calculate administrative burdens, and
we are not re-opening that methodology
or soliciting comment on it.59 We are
simply proposing action and soliciting
comment on Step 3 of the phase-in
approach.
2. Call for Additional Information
Concerning State Burdens
As stated in the Tailoring Rule, the
EPA is committed to tailoring the
applicability criteria that determine
which GHG emission sources become
subject to the PSD and title V programs
of the CAA. The following questions are
structured to help the EPA best assess
the status of GHG permitting programs
based on the three criteria outlined in
the Tailoring Rule, which forms the
basis for this action. We request states
submit responses to the following
questions to the appropriate EPA
Regional Administrator within 45 days
after the date of publication of this
proposal in the Federal Register.
General Permitting Burden/Resources
1. Does your state currently have the
necessary resources (funding and staff)
to run the PSD and title V permitting
program as they exist today?
a. If your state is strained for
resources please describe the reasons for
it? Please list all that apply and provide
a short description of the problem
providing specific information where
possible (i.e., budget cuts of 10 percent
during the last year; hiring freeze; loss
3 FTE in last two years).
i. GHG Permitting
ii. Other Permitting Issues (SO2, NO2,
etc)
iii. Budget cuts
iv. Lack of personnel
v. Other (please specify)
2. If permitting activity were to
increase to levels closer to those
59 Although the Tailoring Rule has been
challenged in the U.S. Court of Appeals for the DC
Circuit, no party has challenged this methodology.
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originally anticipated in the Tailoring
Rule,60 would your state have the
necessary resources to manage the
increased workload?
a. If not, please estimate the level of
additional resources (funding and staff)
your state would require to handle the
increased burden.
3. In providing perspective on the
PSD program, consider the following
scenarios where your annual number of
PSD permitting activity were to increase
by 10, 20, 30, 50, 100, and 200 permit
actions per year (both new permit
applications and modifications
included) due to the potential lowering
of the current GHG applicability
thresholds. When assessing the
resources to permit these sources,
consider that many of the newly
permitted GHG sources under this
scenario would likely consist of
commercial and small industrial sources
whose primary GHG emissions units are
small, similarly configured combustion
units:
a. How many more full-time
employees (FTEs) would your program
need to address each of these potential
permitting activity increases (i.e., 10, 20,
30, 50, 100, and 200 permit actions per
year) in PSD due to GHGs and still meet
current PSD permit processing times?
b. How many additional dollars
annually to your staffing budget would
these additional FTEs equate to?
4. How has GHG permitting affected
the permitting process in your state?
Please consider the areas listed below
and provide specific estimates of the
impact GHG permitting has had on your
program where possible (i.e., responded
to 10 percent more permitting questions
than usual).
a. Number of source meetings.
b. Number of daily permitting
questions.
c. Number of incomplete permit
applications.
d. Training for permitting staff to
understand the GHG permitting process.
e. Is your staff unsure of how and
when to permit GHG sources?
5. For states where PSD permits for
GHG have been issued, how was the
burden (monetary and man-hours)
compared to a typical non-GHG permit?
Please provide an estimate where
possible (i.e., an additional 20 hours).
6. In providing perspective on the title
V program, consider the following
scenarios where your annual number of
title V permitting activity were to
increase by 10, 20, 30, 50, 100, and 200
permit actions per year (both new
permit applications and modifications
included) due to the potential lowering
60 See
75 FR 31540.
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of the current GHG applicability
thresholds. When assessing the
resources to permit these sources,
consider that many of the newly
permitted GHG sources under this
scenario would likely consist of
commercial and small industrial sources
whose primary GHG emissions units are
small, similarly configured combustion
units:
a. How many more full-time
employees (FTEs) would your program
need to address each of these potential
permitting activity increases (i.e., 10, 20,
30, 50, 100, and 200 permit actions per
year) in title V due to GHGs and still
meet current title V permit processing
times?
b. How many additional dollars
annually to your staffing budget would
these additional FTEs equate to?
7. Does your state have an active
outreach initiative and the resources
necessary to reach out to smaller
sources that may not be aware of their
obligation to apply for title V or PSD
permits due to GHGs?
a. If the GHG permitting thresholds
were lowered resulting in additional
sources being subject to the PSD and
title V permitting programs, how would
this affect such initiative? Please be
specific about the level of resources
necessary where possible.
8. Have the GHG requirements created
or added to a backlog of unissued
permits?
a. If so, by what amount?
9. Has your state modified its title V
fees to cover GHG permitting needs? If
not, would your state need to do so if
additional sources (i.e., 10, 20, 30, 50,
100, and 200 actions per year) were
added to the permitting programs as a
result of lowered thresholds?
Streamlining Specific Questions
1. Is your state processing
applications through any electronic
permitting measures? If not do you plan
on implementing an type of electronic
permitting?
2. Has your state implemented LEAN
techniques to streamline the permitting
process? If so, how has this improved
the efficiency for permitting actions? If
not, do you plan on doing this in the
future?
3. Is your state considering any other
permitting streamlining technique to
help improve the efficiency and reduce
the burden associated with permitting of
GHG sources? Please list all
streamlining techniques under
consideration and the expected
implementation timelines.
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B. Solicitation of Comment on
Streamlining Techniques
In section VI of this preamble, we
discuss a range of streamlining
techniques for GHG permitting. In this
action we propose rulemaking to
implement two of these techniques at
this time concerning PALs for GHGs and
creation of federal synthetic minor
source permits for GHGs. For the other
techniques, we present information on
the techniques but propose no
rulemaking at this time. We request
comment on all these potential
streamlining techniques, as discussed in
section VII and in the following
sections. More broadly, we request
comment on other approaches to
streamlining that may hold promise to
reduce PSD and/or title V permitting
burden for sources of GHGs and
permitting authorities. Please include as
much detail as possible on how such an
approach would work, the amount of
burden reduction that could be
achieved, the specific legal authority the
EPA should rely upon for implementing
the approach, and whether EPA
rulemaking would be required for
implementation.
1. Plantwide Applicability Limitations
for GHGs
We request comment on our proposal
to undertake rulemaking at this time to
provide a more flexible approach for
GHG PALs. We further request comment
on which option we should pursue for
this rulemaking, the Major Source Optin Approach or the Minor Source
Approach, and on how, specifically, we
should revise our rules to implement
the preferred approach. In our
discussion of, and rationale for, GHG
PALs in section VI.A of this preamble,
we requested comment on many
specific, related issues. We again
request comment on those issues here.
2. Synthetic Minor Source Permitting
Authority for GHGs
We request comment on our proposal
to create synthetic minor permit
authority, within the existing federal
PSD regulations, for the purpose of
issuing synthetic minor permit
limitations for GHGs. In addition, we
request comment on our legal authority
for implementing such a program.
Finally, we again request comment on
other specific, related issues on which
we requested comment in the
discussion of synthetic minor permit
authority in section VI.B of this
preamble.
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3. Redefining PTE and Source Category
Specific PTE
We request comment on the
discussion in this proposal of our
current thinking on developing category
specific PTE rules or guidance, and on
categories for which such a rule or
guidance would be appropriate. We also
request comment on creating a rule that
would allow a source to use historical
hours of operation in determining an
emissions unit’s PTE. In addition, we
request comment on the other specific,
related issues that we discussed and on
which we requested comment in the
discussion of approaches to PTE in
section VI.C of this preamble.
4. General Permits for GHGs
We request comment on the idea of
developing a rule that would allow use
of general permits for GHG sources, and
on possible sources and source
categories that may benefit from general
permits. We also request information on
the experience of state and local
permitting authorities with the use of
general permits and their potential
applicability to GHG sources. In
addition, we request comment on the
other specific, related issues that we
discussed and on which we requested
comment in the discussion of general
permits in section VI.D of this preamble.
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5. Presumptive BACT for GHGs
We request comment on the concept
of developing presumptive BACT for
sources of GHGs, and on possible source
categories and emissions units that may
be promising candidates for this
approach. We request comment on how
and when to update presumptive BACT
determinations, on the use of
presumptive BACT for general permits,
and on the appropriate public
participation for the development and
application of presumptive BACT. In
addition, we request comment on the
other specific, related issues that we
discussed and on which we requested
comment in the discussion of
presumptive BACT in section VI.E of
this preamble.
6. Title V Empty Permits
We request comment on the extent to
which SIPs contain requirements that
would be applicable to sources that
would be subject to title V solely as a
result of emissions of GHGs below the
current thresholds established by the
Tailoring Rule, and whether a
significant number of sources would
have empty permits at different
thresholds. We also solicit comment on
whether the EPA can, and should,
interpret the title V as not requiring
‘‘empty permits,’’ and if so whether
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state program revisions, approved by the
EPA, would, or should, be necessary to
exclude such sources from title V permit
requirements. In addition, we request
comment on the other specific, related
issues that we discussed and on which
we requested comment in the
discussion of empty permits in section
VI.F of this preamble.
VIII. Statutory and Executive Order
Reviews
A. Executive Order 12866: Regulatory
Planning and Review and Executive
Order 13563: Improving Regulation and
Regulatory Review
Under Executive Order 12866 (58 FR
51735, October 4, 1993), this action is a
‘‘significant regulatory action’’ because
it raises novel legal or policy issues.
Accordingly, the EPA submitted this
action to the OMB for review under
Executive Orders 12866 and 13563 (76
FR 3821, January 21, 2011) and any
changes made in response to OMB
recommendations have been
documented in the docket for this
action.
This proposed Step 3 of the Tailoring
Rule would continue the phased-in
approach begun in Steps 1 and 2.
However, we have determined that it
would not be appropriate at this time to
expand the universe of large sources of
GHG emissions that must comply with
permitting requirements under the Act,
and the proposed rule would not reduce
the GHG applicability thresholds or
bring more sources into the PSD or title
V programs. Thus, the proposed rule
would not impose any costs on sources
of GHGs to obtain permits or on
permitting authorities to issue permits.
B. Paperwork Reduction Act
This action does not impose any new
information collection burden. The
proposed rule would not change the
existing GHG permitting thresholds, and
therefore would not impose any
additional burden on sources to obtain
PSD or title V permits or on permitting
authorities to issue such permits. The
proposed provisions for GHG PALs and
synthetic minor source permitting
authority would have the effect of
reducing permitting burden in that the
burden associated with obtaining or
issuing a PAL permit or synthetic minor
permit would be more than offset
through avoiding subsequent PSD
permitting actions with greater
associated burden. However, if in the
context of the final rule we determine
that the provisions for PALs and
synthetic minors impose new
information collection burden, we will
adjust the information collection
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requirements accordingly. The OMB has
previously approved the information
collection requirements contained in the
existing regulations for the NSR and
title V programs under the provisions of
the Paperwork Reduction Act, 44 U.S.C.
3501 et seq. and has assigned OMB
control number 2060–0003 to the NSR
program and OMB control numbers
2060–0243 and 2060–0336 to the title V
program (40 CFR Part 70 and Part 71
components, respectively). The OMB
control numbers for EPA’s regulations
in 40 CFR are listed in 40 CFR Part 9.
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA)
generally requires an agency to prepare
a regulatory flexibility analysis of any
rule subject to notice and comment
rulemaking requirements under the
Administrative Procedures Act or any
other statute unless the agency certifies
that the rule will not have a significant
economic impact on a substantial
number of small entities. Small entities
include small businesses, small
organizations and small governmental
jurisdictions.
For purposes of assessing the impacts
of this proposed action on small
entities, small entity is defined as: (1) A
small business that is a small industrial
entity as defined in the U.S. Small
Business Administration (SBA) size
standards (see 13 CFR 121.201); (2) a
small governmental jurisdiction that is a
government of a city, county, town,
school district or special district with a
population of less than 50,000; or (3) a
small organization that is any not-forprofit enterprise that is independently
owned and operated and is not
dominant in its field.
After considering the economic
impacts of this proposed action on small
entities, I certify that this proposed
action will not have a significant
economic impact on a substantial
number of small entities. In determining
whether a rule has a significant
economic impact on a substantial
number of small entities, the impact of
concern is any significant adverse
economic impact on small entities,
since the primary purpose of the
regulatory flexibility analysis is to
identify and address regulatory
alternatives ‘‘which minimize any
significant economic impact of the rule
on small entities.’’ 5 U.S.C. 603 and 604.
Thus, an agency may certify that a rule
will not have a significant economic
impact on a substantial number of small
entities if the rule relieves regulatory
burden, or otherwise has a positive
economic effect, on all of the small
entities subject to the rule.
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The proposed rule would not change
the existing GHG permitting thresholds,
and therefore would not impose any
additional burden on any sources
(including small entities) to obtain PSD
or title V permits or on any permitting
authorities (including small entities, if
any) to issue such permits. The
proposed provisions for GHG PALs and
synthetic minor source permitting
authority would have the effect of
reducing permitting burden on all
entities, including small entities, in that
the burden associated with obtaining or
issuing a PAL permit or synthetic minor
permit would be more than offset
through avoiding subsequent PSD
permitting actions with greater
associated burden. We have therefore
concluded that this proposed rule will
be neutral or relieve the regulatory
burden for all affected small entities. We
continue to be interested in the
potential impacts of the proposed rule
on small entities and welcome
comments on issues related to such
impacts. In addition while we propose
to maintain the current thresholds in
this rulemaking, we also solicit
comment on lowering the thresholds. If
we receive information that persuades
us that we should take action to lower
the thresholds, we will at that time
reassess the applicability of the
requirements of the Regulatory
Flexibility Act.
D. Unfunded Mandates Reform Act
This rule does not contain a federal
mandate that may result in expenditures
of $100 million or more for state, local
and tribal governments, in the aggregate,
or the private sector in any 1 year. The
proposed rule would not change the
existing GHG permitting thresholds, and
therefore would not impose any
additional burden on sources to obtain
PSD or title V permits or on permitting
authorities to issue such permits. The
proposed provisions for GHG PALs and
synthetic minor source permitting
authority would have the effect of
reducing permitting burden in that the
burden associated with obtaining or
issuing a PAL permit or synthetic minor
permit would be more than offset
through avoiding subsequent PSD
permitting actions with greater
associated burden. Thus, this rule is not
subject to the requirements of sections
202 or 205 of UMRA.
This rule is also not subject to the
requirements of section 203 of UMRA
because it contains no regulatory
requirements that might significantly or
uniquely affect small governments. As
noted previously, the effect of the
proposed rule would be neutral or
relieve regulatory burden.
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E. Executive Order 13132: Federalism
This proposed rule does not have
federalism implications. It will not have
substantial direct effects on the states,
on the relationship between the national
government and the states or on the
distribution of power and
responsibilities among the various
levels of government, as specified in
Executive Order 13132. This proposed
rule would maintain the existing
structure of the PSD and title V
programs and would not, therefore,
affect the relationship between the
national government and the states or
the distribution of power and
responsibilities among the various
levels of government. In addition, the
proposed rule would not change the
existing GHG permitting thresholds, and
therefore would not impose any
additional burden on state permitting
authorities to issue PSD or title V
permits or such permits. The proposed
provisions for GHG PALs and synthetic
minor source permitting authority
would have the effect of reducing
permitting burden in that the burden
associated with issuing a PAL permit or
synthetic minor permit would be more
than offset through avoiding subsequent
PSD permitting actions with greater
associated burden.
In the spirit of Executive Order 13132,
and consistent with EPA policy to
promote communications between the
EPA and state and local governments,
the EPA specifically solicits comment
on this proposed rule from state and
local officials.
F. Executive Order 13175: Consultation
and Coordination With Indian Tribal
Governments
This action does not have tribal
implications. There are no tribal
authorities currently issuing major NSR
permits, one tribe is implementing a
title V program based on a delegation
agreement under 40 CFR Part 71 and
one tribe has recently obtained approval
of title V program under 40 CFR Part 70.
However, the proposed rule would not
change the existing GHG permitting
thresholds, and therefore would not
impose any additional burden on
sources to obtain PSD or title V permits
or on permitting authorities to issue
such permits. The proposed provisions
for GHG PALs and synthetic minor
source permitting authority would have
the effect of reducing permitting burden
in that the burden associated with
obtaining or issuing a PAL permit or
synthetic minor permit would be more
than offset through avoiding subsequent
PSD permitting actions with greater
associated burden.
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Although Executive Order 13175 does
not apply to this proposed rule, the EPA
specifically solicits additional comment
on this proposed action from tribal
officials.
G. Executive Order 13045: Protection of
Children From Environmental Health
and Safety Risks
The EPA interprets Executive Order
13045 (62 FR 19885, April 23, 1997) as
applying only to those regulatory
actions that concern health or safety
risks, such that the analysis required
under section 5–501 of the Executive
Order has the potential to influence the
regulation. This action is not subject to
Executive Order 13045 because it does
not establish an environmental standard
intended to mitigate health or safety
risks.
H. Executive Order 13211: Actions That
Significantly Affect Energy Supply,
Distribution or Use
This action is not a ‘‘significant
energy action’’ as defined in Executive
Order 13211 (66 FR 28355, May 22,
2001), because it is not likely to have a
significant adverse effect on the supply,
distribution or use of energy. Further,
we have concluded that this rule is not
likely to have any adverse energy effects
because this action would not create any
new requirements for sources in the
energy supply, distribution or use
sectors.
I. National Technology Transfer and
Advancement Act
Section 12(d) of the National
Technology Transfer and Advancement
Act of 1995 (NTTAA), Public Law 104–
113, 12(d) (15 U.S.C. 272 note) directs
the EPA to use voluntary consensus
standards in its regulatory activities
unless to do so would be inconsistent
with applicable law or otherwise
impractical. Voluntary consensus
standards are technical standards (e.g.,
materials specifications, test methods,
sampling procedures and business
practices) that are developed or adopted
by voluntary consensus standards
bodies. The NTTAA directs the EPA to
provide Congress, through the OMB,
explanations when the agency decides
not to use available and applicable
voluntary consensus standards.
This proposed rulemaking does not
involve technical standards. Therefore,
the EPA did not consider the use of any
voluntary consensus standards.
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Air pollution control, Carbon dioxide,
Carbon dioxide equivalents, Greenhouse
gases, Hydrofluorocarbons,
Intergovernmental relations, Methane,
Nitrous oxide, Perfluorocarbons,
Reporting and recordkeeping
requirements, Sulfur hexafluoride.
K. Determination Under Section 307(d)
Pursuant to sections 307(d)(1)(J) and
307(d)(1)(V) of the CAA, the
Administrator determines that this
action is subject to the provisions of
section 307(d). Section 307(d)(1)(J)
specifies that the provisions of section
307(d) apply to ‘‘promulgation or
revision of regulations under [part] C of
title I (pertaining to prevention of
significant deterioration of air quality
and protection of visibility).’’ This
section clearly subjects the portions of
this action that pertain to PSD to the
provisions of section 307(d). Section
307(d)(1)(V) provides that the
provisions of section 307(d) apply to
‘‘such other actions as the Administrator
may determine.’’ Pursuant to this
section, the Administrator determines
that the portions of this action that
pertain to title V are subject to the
provisions of section 307(d). This
determination allows for uniform
treatment for all aspects of this action.
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J. Executive Order 12898: Federal
Actions To Address Environmental
Justice in Minority Populations and
Low-Income Populations
Executive Order 12898 (59 FR 7629,
February 16, 1994) establishes federal
executive policy on environmental
justice. Its main provision directs
federal agencies, to the greatest extent
practicable and permitted by law, to
make environmental justice part of their
mission by identifying and addressing,
as appropriate, disproportionately high
and adverse human health or
environmental effects of their programs,
policies and activities on minority
populations and low-income
populations in the United States.
The EPA has determined that this
proposed rule will not have
disproportionately high and adverse
human health or environmental effects
on minority or low-income populations
because it does not affect the level of
protection provided to human health or
the environment. The proposed rule
would not change the existing GHG
permitting thresholds, and therefore
would not affect the universe of sources
subject to permitting.
Environmental protection,
Administrative practice and procedure,
Air pollution control, Carbon dioxide,
Carbon dioxide equivalents, Greenhouse
gases, Hydrofluorocarbons,
Intergovernmental relations, Methane,
Nitrous oxide, Perfluorocarbons,
Reporting and recordkeeping
requirements, Sulfur hexafluoride.
IX. Statutory Authority
The statutory authority for this action
is provided by sections 101, 111, 114,
116 and 301 of the CAA as amended (42
U.S.C. 7401, 7411, 7414, 7416 and
7601).
List of Subjects
40 CFR Part 49
Environmental protection,
Administrative practice and procedure,
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40 CFR Part 51
Environmental protection,
Administrative practice and procedure,
Air pollution control, Carbon dioxide,
Carbon dioxide equivalents, Greenhouse
gases, Hydrofluorocarbons,
Intergovernmental relations, Methane,
Nitrous oxide, Perfluorocarbons,
Reporting and recordkeeping
requirements, Sulfur hexafluoride.
40 CFR Part 52
Environmental protection,
Administrative practice and procedure,
Air pollution control, Carbon dioxide,
Carbon dioxide equivalents, Greenhouse
gases, Hydrofluorocarbons,
Intergovernmental relations, Methane,
Nitrous oxide, Perfluorocarbons,
Reporting and recordkeeping
requirements, Sulfur hexafluoride.
40 CFR Part 70
40 CFR Part 71
Environmental protection,
Administrative practice and procedure,
Air pollution control, Carbon dioxide,
Carbon dioxide equivalents, Greenhouse
gases, Hydrofluorocarbons, Methane,
Nitrous oxide, Perfluorocarbons,
Reporting and recordkeeping
requirements, Sulfur hexafluoride.
Dated: February 24, 2012.
Lisa P. Jackson,
Administrator.
For the reasons stated in the
preamble, title 40, chapter I of the Code
of Federal Regulations is proposed to be
amended as set forth below.
PART 52—[AMENDED]
1. The authority citation for part 52
continues to read as follows:
Authority: 42 U.S.C. 7401, et seq.
Subpart A—[Amended]
2. In § 52.21, add paragraph (dd) to
read as follows:
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§ 52.21 Prevention of significant
deterioration of air quality.
*
*
*
*
*
(dd) Synthetic minor permits. The
provisions in paragraphs (dd)(1) through
(dd)(7) of this section govern issuance
of, and compliance with, synthetic
minor permits that the Administrator
may issue to owners or operators of
GHG-emitting sources.
(1) Authority to issue GHG synthetic
minor permits. (i) The Administrator
may issue a GHG synthetic minor
permit, when requested by the owner or
operator of a GHG-emitting source that
contains one or more emissions
limitations that have the effect of
reducing the potential to emit GHGs to:
(a) Below a level of GHG emissions
(expressed as CO2e and computed in
accordance with paragraph (b)(49)(ii) of
this section) specified in the ‘‘subject to
regulation’’ definition contained in
paragraph (b)(49)(iv) of this section;
(b) Below the major stationary source
applicability thresholds contained in
paragraph (b)(1) of this section; and/or
(c) Below the significant rate
contained in paragraph (b)(23)(i) of this
section, or when no significant rate for
GHG is contained in that paragraph, to
a level of no net emissions increase as
specified in paragraph (b)(23)(ii) of this
section.
(ii) The Administrator may issue a
GHG synthetic minor permit for
purposes of:
(a) Allowing the GHG-emitting source
to avoid applicability of paragraphs (j)
through (r)(5) of this section, for that
source’s GHG emissions, or
(b) Establishing a creditable GHG
emissions reduction on either a tpy
mass basis, or on a CO2e basis (as
computed in accordance with paragraph
(b)(49)(ii) of this section).
(iii) Such permits shall contain
restrictions that are legally enforceable
and enforceable as practical matter.
(iv) Nothing in this paragraph relieves
an owner or operator of a GHG-emitting
source from complying with any federal
or state requirements that otherwise
apply to the source.
(2) Definitions. For purposes of
paragraph (dd) of this section, the
definitions in paragraphs (dd)(2)(i)
through (iv) of this section apply. When
a term is not defined in these
paragraphs, it shall have the meaning
given in paragraph (b) of this section or
in the Act.
(i) Emissions limitation means a
requirement established by the
Administrator which limits the
quantity, rate, or concentration of GHG
emissions on a continuous basis,
including any requirement relating to
the operation or maintenance of one or
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more emissions units to assure
continuous emissions reduction, and
any design standard, equipment
standard, work practice, operational
standard, or pollution prevention
technique when the Administrator can
compute the effect of such requirements
on the potential to emit GHGs of the
emission unit(s)o and such requirement
is legally enforceable and enforceable as
a practical matter.
(ii) GHG-emitting source means any
stationary source that emits or has the
potential to emit GHGs in amounts that
are at or above the major stationary
source thresholds contained in
paragraph (b)(1) of this section, and is
also:
(a) A major stationary source for any
other regulated NSR pollutant;
(b) A new major stationary that will
emit or have the potential to emit
100,000 tpy CO2e; or
(c) A stationary source that emits or
has the potential to emit 100,000 tpy
CO2e.
(iii) GHG synthetic minor permit
means a permit that the Administrator
issues to a GHG-emitting source that
contains one or more emissions
limitations that allows the source to
become a GHG synthetic minor source;
reduces potential to emit GHGs to a
level below the significant rate
contained in paragraph (b)(23) of this
paragraph; reduces potential to emit
GHGs to a level that assures that there
is no net emissions increase from the
GHG-emitting source, and/or creates a
creditable emissions reduction for GHGs
under paragraph (b)(3) of this section.
(iv) GHG synthetic minor source
means a GHG-emitting source that, in
absence of the Administrator’s issuance
of a synthetic minor permit, would have
the potential to emit GHGs in amounts
that are at or above the subject to
regulation thresholds contained in
paragraph (b)(49) of this section, and the
major stationary source thresholds
contained in paragraph (b)(1) of this
section, but has obtained a synthetic
minor permit to limit the potential to
emit GHGs to below either of these
amounts.
(3) Permit application requirements.
As part of a permit application
requesting a GHG synthetic minor
permit, the owner or operator of a GHGemitting source shall submit the
following information to the
Administrator for approval:
(i) Identifying information, including
the name and address of the owner or
operator (and plant name and address if
different), and the name and telephone
number of the plant manager/contact.
(ii) A description of any ongoing or
future planned construction activity that
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involves or affects emission units
identified in paragraph (dd)(3)(iii) of
this section, or involves construction of
new emissions unit(s); and the
commencement date of construction,
the anticipated completion date, and the
anticipated date each emissions unit
will resume or begin regular operations.
(iii) A list of all emissions units that
are located at the GHG-emitting source
that emit GHGs; and any new emissions
units identified in paragraph (dd)(3)(ii)
of this section.
(iv) For each emissions unit identified
in paragraph (dd)(3)(iii) of this section,
the unit’s potential to emit GHGs along
with supporting calculations.
(a) For purposes of this application,
the potential to emit of each emissions
unit shall be computed without
considering any emissions limitations
that might be established through the
Administrator’s issuance of a GHG
synthetic minor permit.
(b) Such calculations shall include
fugitive emissions, to the extent that
they are quantifiable, if the emissions
unit or GHG-emitting source belongs to
one of the source categories listed in
paragraph (b)(1)(iii) of this section.
(v) An identification of each
emissions unit for which the permit
applicant requests that the
Administrator establish an emissions
limitation, along with the following
information:
(a) The proposed emissions limitation
for each emissions unit and a
description of its effect on the potential
to emit of the emissions unit. The
proposed emission limitations must be
expressed over the shortest practicable
time period, taking into consideration
the operation of the source and the
methods to be used for demonstrating
compliance.
(b) Proposed testing, monitoring,
recordkeeping, and reporting
requirements to be used to demonstrate
and assure compliance with the
proposed emissions limitation.
(c) A description of the production
processes.
(d) Identification of the emissions
units.
(e) Type and quantity of fuels and/or
raw materials used, if applicable.
(f) Description and estimated
efficiency of air pollution control
equipment under present and
anticipated operating conditions.
(g) Estimates of the current actual
emissions, including all calculations for
the estimates.
(h) Estimates of the potential to emit
that would result from compliance with
the proposed emissions limitation,
including all calculations for the
estimates.
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(i) An identification of other federal
requirements with which the emissions
unit must comply.
(vi) Any other information
specifically requested by the
Administrator.
(4) Procedures for obtaining a
synthetic minor permit. (i) The owner or
operator of the GHG-emitting source
must submit a permit application to the
Administrator. The application must
contain the information specified in
paragraph (dd)(3) of this section.
Option 1 for paragraphs (dd)(4)(ii) and
(iii):
(ii) Within 60 days after receipt of an
application, the Administrator will
determine if it contains the information
specified in paragraph (dd)(3) of this
section.
(iii) If the Administrator determines
that the application is not complete, the
Administrator will request additional
information from the owner or operator
as necessary to process the application.
If the Administrator determines that the
application is complete, the
Administrator will notify the owner or
operator in writing. The Administrator
should postmark the completeness
determination or request for additional
information within 60 days of receipt of
the permit application. The application
is deemed complete if the Administrator
does not request additional information,
or send a notice of complete application
postmarked within 60 days of receipt of
the permit application.
Option 2 for paragraphs (dd)(4)(ii) and
(iii):
(ii) Within 30 days after receipt of an
application, the Administrator will
determine if it contains the information
specified in paragraph (dd)(3) of this
section.
(iii) If the Administrator determines
that the application is not complete, the
Administrator will request additional
information from the owner or operator
as necessary to process the application.
If the Administrator determines that the
application is complete, the
Administrator will notify owner or
operator in writing. The Administrator
should postmark the completeness
determination or request for additional
information within 30 days of receipt of
the permit application by the
Administrator.
(iv) The Administrator will prepare a
draft synthetic minor permit that
describes the proposed emissions
limitation(s) and the effect of such
emissions limitation(s) on the potential
emissions from any projects identified
in paragraph (dd)(3)(ii) of this section,
and the potential to emit GHGs of both
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the emissions units identified in
paragraph (dd)(3)(iii) of this section and
the GHG-emitting source.
(v) The Administrator must provide
an opportunity for public comment and
public participation on the draft
synthetic minor permit as set out in
paragraphs (dd)(6) of this section.
(vi) After the close of the public
comment period, the Administrator will
review all comments received and either
prepare a final synthetic minor permit
or a written explanation of the reasons
for a decision to deny the application
for the synthetic minor permit.
(vii) The final synthetic minor permit
is subject to administrative and judicial
review as set out in paragraph (dd)(7) of
this section.
(5) Permit Content. The permit must
include the requirements in paragraphs
(dd)(5)(i) through (vii) of this section.
(i) General Requirements. The
following elements must be included in
the permit:
(a) The effective date of the permit,
and an effective date for any terms and
conditions of the permit, if such date
differs from the effective date of the
permit; and
(b) An identification of the emissions
units subject to the permit and each
emissions unit’s associated emissions
limitations.
(ii) Emissions limitations. The permit
must contain one or more emissions
limitations. Each emissions limitation
must meet the requirements of
paragraphs (dd)(5)(ii)(a) through (d) of
this section.
(a) To effectively reduce the potential
to emit of one or more emissions units
at the GHG-emitting source, the permit
must include an emissions limitation
that is legally enforceable and
enforceable as a practical matter, and is
expressed over the shortest practicable
time period, generally not to exceed a
12-month rolling total.
(b) Such emissions limitation must
consist of one or more numerical
limitations on the quantity, rate, or
concentration of GHG emissions on
either a mass or CO2e basis that is
expressed over the shortest practical
time period and that is legally
enforceable and enforceable as a
practical matter. If it is impracticable to
impose a numerical limitation, then the
Administrator may establish pollution
prevention requirements, design
standards, equipment standards, work
practices, operational standards, or
maintenance standards, when the
Administrator can compute the effect of
such restrictions on the emissions unit’s
or GHG-emitting source’s potential to
emit GHG and the requirements are
legally enforceable and enforceable as a
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practical matter. The Administrator may
also establish any combination of the
above requirements.
(c) A statement that the emissions
limitation applies at all times including
startup, shutdown, and malfunction
unless a separate emissions limitation
applies to these emissions, and such
emissions are expressly excluded from
an emissions limitations, or the
Administrator directs otherwise in the
permit.
(d) The calculation procedure the
owner or operator will use to convert
the monitoring system data to emissions
data to demonstrate compliance with
the emissions limitation.
(iii) Monitoring requirements. The
permit must include monitoring
requirements sufficient to assure
compliance with the emissions
limitations. The Administrator must
require, as appropriate, any of the
requirements in paragraphs
(dd)(5)(iii)(a) and (b) of this section.
(a) A requirement to monitor,
including analysis procedures, test
methods, periodic testing, instrumental
monitoring, and non-instrumental
monitoring. Such monitoring
requirements shall assure use of test
methods, units, averaging periods, and
other statistical conventions consistent
with the required emissions limitations.
(b) As necessary, requirements
concerning the use, maintenance, and
installation of monitoring equipment or
methods.
(iv) Recordkeeping requirements. The
permit must include recordkeeping
requirements sufficient to assure
compliance with the emissions
limitations and monitoring
requirements, and must require the
elements in paragraphs (dd)(5)(iv)(a)
through (c) of this section.
(a) Records of required monitoring
information that include the
information in paragraphs
(dd)(5)(iv)(a)(1) through (6) of this
section, as appropriate.
(1) The location, date, and time of
sampling or measurements.
(2) The date(s) analyses were
performed.
(3) The company or entity, and the
name of the specific individuals that
performed the analyses.
(4) The analytical techniques or
methods used.
(5) The results of such analyses.
(6) The operating conditions existing
at the time of sampling or measurement.
(b) Retention for 5 years of records of
all required monitoring data and
support information for the monitoring
sample, measurement, report, or
application. Support information may
include all calibration and maintenance
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records, all original strip-chart
recordings or digital records for
continuous monitoring instrumentation,
and copies of all reports required by the
permit.
(c) A copy of the synthetic minor
permit application and any additional
information requested by the
Administrator to support the
application.
(v) Reporting requirements. The
permit must include the reporting
requirements in paragraphs (dd)(5)(v)(a)
through (d) of this section.
(a) Annual submittal of total GHG
emissions and calculations for each
emissions unit subject to an emissions
limitation in the synthetic minor permit.
Such calculations shall be based on the
terms and conditions in the permit that
limit GHG emissions. Where necessary
for a calculation of annual GHG
emissions, the permit must require
reporting of actual hours of operation,
material used, and other relevant
metrics.
(b) Prompt reporting of deviations
from permit requirements, including
those attributable to upset conditions as
defined in the permit, the probable
cause of such deviations, and any
corrective actions or preventive
measures taken. Within the permit, the
Administrator must define ‘‘prompt’’ in
relation to the degree and type of
deviation likely to occur and the
applicable emissions limitations.
(c) For each requirement in the
permit, an annual submission of a
compliance certification signed by the
owner or operator, attesting to the GHGemitting source’s compliance with such
requirement, or a statement that the
GHG-emitting source failed to comply
with the requirement and an
explanation of such non-compliance.
For purposes of complying with this
reporting requirement, the owner or
operator may concurrently attest to all
requirements with which it complied,
but must address each requirement with
which it failed to comply separately.
(d) A requirement to notify the
Administrator in writing within 30 days
from the date the operator begins actual
construction, and any construction
activity completes, and when regular
operations begin, for any project
involving or affecting any emissions
unit that is subject to a requirement in
the synthetic minor permit.
(e) A requirement to provide all
reports electronically, unless the
Administrator has not provided a
system for such electronic reporting.
(1) For projects involving or affecting
multiple emissions units, the
notification must be submitted within
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30 days from when such activities first
occur for any emissions unit.
(2) If such activity was not already
described in the permit application as
required by paragraph (dd)(3) of this
section, the notification shall identify
the emissions units involved in or
affected by the project, and describe the
nature of the construction activity and
any affect such activity will have on the
potential to emit of an emissions unit,
or on the GHG-emitting source,
otherwise the notification should
reference the permit application.
(vi) Severability clause. A statement
stating that the provisions of this
synthetic minor permit are severable,
and if any provision of the permit is
held invalid, the remainder of the
permit shall not be affected.
(vii) Additional provisions. The
permit must also contain provisions
stating the requirements in paragraphs
(dd)(5)(vii)(a) through (g) of this section.
(a) You, as the permittee, must
comply with all conditions of your
permit, including emissions limitations
that apply to the emissions units at your
source. Noncompliance with any permit
term or condition is a violation of the
permit and may constitute a violation of
the Act and is grounds for enforcement
action and for a permit termination or
revocation.
(b) It is not a defense for you, as the
permittee, in an enforcement action that
it would have been necessary to halt or
reduce the permitted activity in order to
maintain compliance with the
conditions of this permit.
(c) The Administrator may reopen,
revise, terminate or revoke the permit.
The filing of a request by you, as the
permittee, for a permit revision,
revocation, or termination, or of a
notification of planned changes or
anticipated noncompliance does not
stay any permit condition.
(d) The permit does not relieve the
permittee from complying with any
federal or state requirements that
otherwise apply to the source.
(e) The permit does not convey any
property rights of any sort or any
exclusive privilege.
(f) You, as the permittee, shall furnish
to the Administrator, within a
reasonable time, any information that
the Administrator may request in
writing to determine whether cause
exists for reopening, revising, revoking,
or terminating the permit or to
determine compliance with the permit.
For any such information claimed to be
confidential, you must also submit a
claim of confidentiality in accordance
with part 2, subpart B of this chapter.
(g) You, as the permittee, must allow
a representative of the Administrator
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(who must comply with the safety
requirements of the permittee) to:
(1) Enter upon your premises where
the source is located or emissionsrelated activity is conducted, or where
records are required to be kept under
the conditions of the permit;
(2) Have access to and copy, at
reasonable times, any records that are
required to be kept under the conditions
of the permit;
(3) Inspect, during normal business
hours or while the source is in
operation, any facilities, equipment
(including monitoring and air pollution
control equipment), practices, or
operations regulated or required under
the permit;
(4) Sample or monitor, at reasonable
times, substances or parameters for the
purpose of determining compliance
with the permit or other applicable
requirements; and
(5) Record any inspection by use of
written, electronic, magnetic, and
photographic media.
(6) Public participation requirements.
This paragraph applies to the issuance
of synthetic minor permits.
(i) Public availability of documents.
With the exception of any confidential
information as defined in part 2, subpart
B of this chapter, the Administrator
must make available for public
inspection the documents listed in
paragraphs (dd)(6)(i)(a) through (d) of
this section. The Administrator must
make such information available for
public inspection at the appropriate
EPA Regional Office.
(a) All information submitted as part
of an application for a permit.
(b) Any additional information
requested by the Administrator.
(c) The Administrator’s analysis of the
application and any relevant, additional
information submitted by the source.
(d) A copy of the draft permit or the
decision to deny the permit with the
justification for denial.
(ii) Public notice requirements. (a)
Before issuing a synthetic minor permit,
the Administrator must prepare a draft
permit and must provide adequate
public notice to ensure that the area
affected has reasonable access to the
application and draft permit
information, as set out in paragraphs
(dd)(6)(ii)(a)(1) and (2) of this section.
The public notice must provide an
opportunity for public comment, and
may provide notice of a public hearing
on the draft permit.
(1) The Administrator must mail a
copy of the notice to the GHG-emitting
source, and the state, and local air
pollution authorities having jurisdiction
in the area in which the GHG-emitting
source is located.
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(2) The Administrator will use
appropriate means of notification,
depending on such factors as the nature
and size of your source, local air quality
considerations, and the characteristics
of the population in the affected area.
Appropriate means include those listed
in paragraphs (dd)(6)(ii)(a)(2)(i) through
(v) of this section.
(i) The Administrator may mail or
email a copy of the notice to persons on
a mailing list developed by the
Administrator consisting of those
persons who have requested to be
placed on such a mailing list.
(ii) The Administrator may post the
notice on its Web site.
(iii) The Administrator may publish
the notice in a newspaper of general
circulation in the area affected by the
source.
(iv) The Administrator may provide
copies of the notice for posting at one
or more locations in the area affected by
the source, such as post offices, trading
posts, libraries, tribal environmental
offices, community centers, or other
gathering places in the community.
(v) The Administrator may employ
other means of notification as
appropriate.
(b) The notice required pursuant to
paragraph (dd)(6)(ii)(a) of this section
must include the following information
at a minimum:
(1) Identifying information, including
the name and address of the owner and
operator of the GHG-emitting source
(and plant name and address if
different) and the name and telephone
number of the plant manager/contact;
(2) The name and address of the
reviewing authority processing the
permit action;
(3) An explanation of any emissions
changes that will result from the permit
action;
(4) A description of the proposed
emissions limitation(s) and its effect on
the potential to emit of a project, one or
more emissions units, or the GHGemitting source;
(5) Instructions for requesting a public
hearing;
(6) The name, address, and telephone
number of a contact person in the
reviewing authority’s office from whom
additional information may be obtained;
(7) Locations and times of availability
of the information (listed in paragraph
(dd)(6)(i) of this section) for public
inspection; and
(8) A statement that any person may
submit written comments, a written
request for a public hearing, or both, on
the draft permit action and the time
frames by which any person must take
such action(s).
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(iii) Public comment. (a) The
Administrator must provide at least 30
days from the date of public notice
provided under paragraph (dd)(6)(ii) of
this section for the public to submit
comments on the draft permit. The
Administrator may extend this period if
he or she determines it is appropriate to
do so.
(b) Any person may submit written
comments on the draft permit during
the public comment period. These
comments must raise any reasonably
ascertainable issue with supporting
arguments by the close of the public
comment period.
(c) The public comment period under
paragraph (dd)(6)(iii)(a) of this section
will not close before the date of any
public hearing held in accordance with
paragraph (dd)(6)(iv) of this section. The
hearing officer may also extend the
comment period by so stating at the
hearing.
(iv) Public Hearing. (a) Any person
may request a public hearing on a
permit, but such request must be
submitted to the Administrator, in
writing, and must state the nature of the
issues proposed to be raised at the
hearing, and must be postmarked no
later than 15 days after the
Administrator provides public notice of
the draft permit under paragraph
(dd)(6)(ii) of this section.
(b) The Administrator must hold a
hearing whenever there is, on the basis
of requests and the issues raised therein,
a significant degree of public interest in
a draft permit. The Administrator may
also hold a public hearing at the
Administrator’s discretion whenever,
for instance, such a hearing might
clarify one or more issues involved in
the permit decision.
(c) The Administrator must provide
notice, consistent with the requirements
in paragraph (dd)(6)(ii) of this section,
that the Administrator will hold a
public hearing. Such notice must be
provided at least 15 days before the date
of the hearing. Public notice of the
hearing may be concurrent with that of
the draft permit, and the two notices
may be combined.
(d) The Administrator may set
reasonable limits on the time allowed
for oral statements at the hearing.
(e) The Administrator must make a
tape recording or written transcript of
any hearing available to the public as
part of the final administrative record
for the permit under paragraph
(dd)(7)(iii) of this section.
(7) Final permit issuance and
administrative and judicial review—(i)
Notification of the final permit decision.
The Administrator must notify the GHGemitting source of the final permit
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17:13 Mar 07, 2012
Jkt 226001
decision, in writing, and if the permit is
denied, of the reasons for such denial.
The Administrator must also provide
adequate public notice of the final
permit decision, consistent with the
provisions in paragraph (dd)(6)(ii) of
this section.
(ii) Effective date of the permit. A
final permit becomes effective 30 days
after the Administrator issues the
permit, unless:
(a) A later effective date is specified
in the permit; or
(b) Review of the final permit is
request under paragraph (dd)(7)(iv), in
which case the effective date of the
permit is stayed until the Administrator
issues a notice of final agency action
under paragraph (dd)(7)(iv)(b), unless
the Administrator notifies the
Environmental Appeals Board, and the
applicant, and all of the interested
parties, that the permit contains
uncontested and severable conditions,
in which case, these conditions shall
become fully effective enforceable
obligations of the permit as specified in
paragraph (dd)(7)(ii)(a) of this section,
but the remainder of the permit
conditions will be stayed as specified in
this paragraph; or
(c) The Administrator may make the
permit effective immediately upon
issuance if no comments requested a
significant change in the draft permit or
provided a technical justification for
why the Administrator should deny the
permit.
(iii) Administrative record. (a) The
Administrator must base final permit
decisions on an administrative record
consisting of:
(1) The application and any
supporting data furnished by the
applicant;
(2) The draft permit or notice of intent
to deny the application;
(3) Other documents in the supporting
files for the draft permit that the
Administrator considered in the
decisionmaking;
(4) All significant comments received
during the public comment period;
(5) The tape or transcript or other
electronic record of any hearing(s) held;
(6) Any written material submitted at
such hearing(s);
(7) Any new materials placed in the
record as a result of the Administrator’s
evaluation of public comments;
(8) The final permit; and
(9) Other documents in the supporting
files for the final permit that the
Administrator considered in the final
decisionmaking.
(b) The Administrator must add the
additional documents required under
paragraph (dd)(7)(iii)(a) of this
paragraph to the record as soon as
PO 00000
Frm 00039
Fmt 4701
Sfmt 4702
14263
possible after their receipt or
preparation by the Administrator. The
record is complete on the date the
Administrator issues the final permit.
(c) Material readily available or
published materials that are generally
available and that are included in the
administrative record under the
standards of paragraph (dd)(7)(iii)(a) of
this paragraph need not be physically
included in the same file as the rest of
the record as long as it is specifically
referred to in the that file.
(iv) Appealing a permit decision.
Permit decisions may be appealed
according to the following provisions:
(a) The Administrator delegates
authority to the Environmental Appeals
Board (the Board) to issue final
decisions in permit appeals filed under
this program. An appeal directed to the
Administrator, rather than to the Board,
will be forwarded to the Board for
consideration. This delegation does not
preclude the Board from referring an
appeal or a motion under this program
to the Administrator when the Board, in
its discretion, deems it appropriate to do
so. When an appeal or motion is
referred to the Administrator by the
Board, all parties shall be so notified
and the provisions of this program
referring to the Board shall be
interpreted as referring to the
Administrator.
(b) Any person seeking to appeal a
permit decision must follow the
provisions for PSD permits in § 124.19
of this chapter.
(c) The final synthetic minor permit is
subject to administrative and judicial
review as set out in § 124.19 of this
chapter.
(v) Permit Revisions. (a) The
Administrator may reopen, revise,
terminate, or revoke requirements
within the synthetic minor permit, or
may take such action on the entirety of
the synthetic minor permit. Such
actions may be taken by the
Administrator for cause on its own
initiative, or at the request of the
permittee.
(b) Except for administrative permit
revisions identified in paragraph
(dd)(7)(vi) of this section, the
Administrator shall follow all of the
public participation requirements in
paragraphs (dd)(6) of this section before
revising, revoking, or terminating
requirements in the synthetic minor
permit.
(c) All changes to a permit are subject
to the effective date, and administrative
review requirements contained in
paragraph (dd)(7)(i) through (iv) of this
section.
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(vi) Administrative permit revision.
The following provisions govern
administrative permit revisions.
(a) An administrative permit revision
is a permit revision that makes any of
the following changes:
(1) Corrects typographical, calculation
or other errors.
(2) Identifies a change in the name,
address, or phone number of any person
identified in the permit, or provides a
similar minor administrative change at
the source.
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Jkt 226001
(3) Requires more frequent monitoring
or reporting by the permittee.
(4) Allows for a change in ownership
or operational control of a GHG-emitting
source when the Administrator
determines that no other change in the
permit is necessary, provided that a
written agreement containing a specific
date for transfer of permit responsibility,
coverage, and liability between the
current and new permittee has been
submitted to the Administrator.
PO 00000
Frm 00040
Fmt 4701
Sfmt 9990
(5) Incorporates any other type of
change that the Administrator
determines is similar to those in
paragraphs (dd)(7)(vi)(a)(1) through (5)
of this section.
(b) An administrative permit revision
is not subject to the permit application,
issuance, public participation or
administrative requirements of this
program.
[FR Doc. 2012–5431 Filed 3–7–12; 8:45 am]
BILLING CODE 6560–50–P
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[Federal Register Volume 77, Number 46 (Thursday, March 8, 2012)]
[Proposed Rules]
[Pages 14226-14264]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-5431]
[[Page 14225]]
Vol. 77
Thursday,
No. 46
March 8, 2012
Part V
Environmental Protection Agency
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40 CFR Parts 51, 52, 70 and 71
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Prevention of Significant Deterioration and Title V Greenhouse Gas
Tailoring Rule Step 3, GHG Plantwide Applicability Limitations and GHG
Synthetic Minor Limitations; Proposed Rule
Federal Register / Vol. 77 , No. 46 / Thursday, March 8, 2012 /
Proposed Rules
[[Page 14226]]
-----------------------------------------------------------------------
ENVIRONMENTAL PROTECTION AGENCY
40 CFR Parts 51, 52, 70 and 71
[EPA-HQ-OAR-2009-0517; FRL-9643-8]
RIN 2060-AR10
Prevention of Significant Deterioration and Title V Greenhouse
Gas Tailoring Rule Step 3, GHG Plantwide Applicability Limitations and
GHG Synthetic Minor Limitations
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: This proposal concerns the third step (Step 3) in the EPA's
Tailoring Rule. We are proposing to maintain the applicability
thresholds for greenhouse gas (GHG)-emitting sources at the current
levels. We are also proposing two streamlining approaches, which will
improve the administration of GHG Prevention of Significant
Deterioration (PSD) and title V permitting programs. The first proposal
addresses the implementation of GHG plantwide applicability limitations
(PALs). We propose to allow permitting authorities to issue GHG PALs on
either a mass-basis (tpy) or a carbon dioxide equivalent
(CO2e)-basis and to allow PALs to be used as an alternative
approach for determining whether a project is a major modification and
whether GHG emissions are subject to regulation. The second proposal
would create the regulatory authority for the EPA to issue synthetic
minor limitations for GHGs in areas subject to a GHG PSD Federal
Implementation Plan (FIP). We also discuss our progress in evaluating
the suitability of other streamlining approaches and solicit further
comment.
DATES: Comments must be received on or before April 20, 2012.
Public Hearing. One public hearing will be held on March 20, 2012.
For additional instructions on the public hearing, go to the
SUPPLEMENTARY INFORMATION section of this document.
ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2009-0517, by one of the following methods:
https://www.regulations.gov: Follow the online instructions
for submitting comments.
Email: a-and-r-docket@epa.gov. Attention Docket ID No.
EPA-HQ-OAR-2009-0517.
Fax: (202) 566-9744.
Mail: Attention Docket ID No. EPA-HQ-OAR-2009-0517, Air
and Radiation Docket and Information Center, Mailcode: 2822T, U.S.
Environmental Protection Agency, 1200 Pennsylvania Avenue NW.,
Washington, DC 20460. Please include a total of two copies. In
addition, please mail a copy of your comments on the information
collection provisions to the Office of Information and Regulatory
Affairs, Office of Management and Budget, Attn: Desk Officer for EPA,
725 17th Street NW., Washington, DC 20503.
Hand Delivery: Air and Radiation Docket and Information
Center, EPA/DC, EPA West, Room 3334, 1301 Constitution Avenue NW.,
Washington, DC 20004, Attention Docket ID No. EPA-HQ-OAR-2009-0517.
Such deliveries are only accepted during the Docket Center's normal
hours of operation, and special arrangements should be made for
deliveries of boxed information.
Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2009-0517. The EPA's policy is that all comments received will be
included in the public docket without change and may be made available
online at www.regulations.gov, including any personal information
provided, unless the comment includes information claimed to be
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute. Do not submit information that you
consider to be CBI or otherwise protected through www.regulations.gov
or email. The www.regulations.gov Web site is an ``anonymous access''
system, which means the EPA will not know your identity or contact
information unless you provide it in the body of your comment. If you
send an email comment directly to the EPA without going through
www.regulations.gov your email address will be automatically captured
and included as part of the comment that is placed in the public docket
and made available on the Internet. If you submit an electronic
comment, the EPA recommends that you include your name and other
contact information in the body of your comment and with any disk or
CD-ROM you submit. If the EPA cannot read your comment due to technical
difficulties and cannot contact you for clarification, the EPA may not
be able to consider your comment. Electronic files should avoid the use
of special characters, any form of encryption, and be free of any
defects or viruses. For additional instructions on submitting comments,
go to section I.C of the SUPPLEMENTARY INFORMATION section of this
document.
Docket: All documents in the docket are listed in the
www.regulations.gov index. 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, will be publicly available only in hard copy.
Publicly available docket materials are available either electronically
in www.regulations.gov or in hard copy at the Air and Radiation Docket
and Information Center, EPA/DC, EPA West, Room 3334, 1301 Constitution
Avenue 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 Air and Radiation Docket and Information
Center is (202) 566-1742.
Public Hearing: One public hearing will be held on this proposed
rule. The hearing will be held on March 20, 2012, at the DoubleTree
Hotel--Crystal City, 300 Army Navy Drive, Arlington, Virginia 22202;
phone number (703) 416-4100. The public hearing will convene at 10 a.m.
and continue until 7 p.m. (local time) or later, if necessary,
depending on the number of speakers wishing to participate. The EPA
will make every effort to accommodate all speakers that are registered
and arrive before 7 p.m. A lunch break is scheduled from 1 p.m. until 2
p.m. and a thirty minute break is scheduled from 4:30 p.m. until 5 p.m.
during the hearing. The EPA Web site for the rulemaking, which includes
the proposal and information about the public hearing, can be found at:
www.epa.gov/nsr.
FOR FURTHER INFORMATION CONTACT: Michael S. Brooks, Air Quality Policy
Division, Office of Air Quality Planning and Standards (C504-05),
Environmental Protection Agency, Research Triangle Park, North Carolina
27711; telephone number (919) 541-3539; fax number (919) 541-5509;
email address: brooks.michaels@epa.gov. The public hearing will provide
interested parties the opportunity to present data, views, or arguments
concerning these proposed rules. Persons interested in presenting oral
testimony should notify Ms. Long at least 1 day in advance of the
public hearing. To register to speak, attend or for information
pertaining to the public hearing on this document, contact Ms. Pamela
S. Long, Air Quality Policy Division, Office of Air Quality Planning
and Standards (C504-01), Environmental Protection Agency, Research
Triangle Park, North Carolina 27711; telephone number (919) 541-0641;
fax number (919) 541-5509; email address: long.pam@epa.gov.
SUPPLEMENTARY INFORMATION: The information in this SUPPLEMENTARY
[[Page 14227]]
INFORMATION section of this preamble is organized as follows:
I. General Information
A. Executive Summary
1. Purpose of the Regulatory Action
2. Summary of Major Provisions
B. Does this action apply to me?
C. Where can I get a copy of this document and other related
information?
D. What should I consider as I prepare my comments for the EPA?
1. Submitting CBI
2. Tips for Preparing Your Comments
E. How can I find information about the public hearing?
F. What acronyms, abbreviations and units are used in this
preamble?
II. Overview of the Proposed Rule
III. Background
A. Statutory and Regulatory Background for PSD and Title V
B. How does the Tailoring Rule address GHG emissions under PSD
and Title V?
C. In the Tailoring Rule, what commitments did the EPA make for
Step 3?
D. In the Tailoring Rule, what plan did the EPA announce for
developing streamlining measures?
E. In the Tailoring Rule, what commitments did the EPA make for
subsequent action?
IV. Available Information on GHG Permitting
A. GHG Permitting Activity to Date
B. Consultations With States
C. Additional Technical Support for the Step 3 Rule
V. Proposed Step 3 Rule
A. Overview
B. Have states had adequate time to ramp up their resources?
C. What is the ability of permitting authorities to issue timely
permits?
D. Has the EPA developed streamlining methods?
E. Limited Benefit From Lowering Thresholds in Step 3
F. Conclusion
VI. Streamlining for PSD and Title V Permitting of GHGs
A. Plantwide Applicability Limitations for GHGs
1. What is the EPA proposing?
2. What is a PAL?
3. Why are we proposing to amend the regulations?
4. Options for Allowing GHG-Only Sources To Obtain a GHG PAL
5. Extending PALs to GHGs on a CO2e Basis and Using
PALs To Determine Whether GHG Emissions Are ``Subject to
Regulation''
6. Can a GHG source that already has a mass-based GHG PAL obtain
a CO2e-based PAL once we issue final changes to the PAL
rules?
7. How would we change the regulatory provisions to implement
PALs for GHG-only major sources?
B. Synthetic Minor Source Permitting Authority for GHGs
1. What is the EPA proposing?
2. What is synthetic minor limitation, and what is its function?
3. What is a ``subject to regulation'' limitation?
4. Why does the EPA need authority to issue synthetic minor
source permits?
5. What are the benefits to a federal GHG synthetic minor permit
program?
6. What is the legal rationale for EPA's GHG synthetic minor
source permitting authority?
7. What changes would EPA make to the PSD regulations to allow
EPA to issue GHG synthetic minor permits?
C. Redefining Potential To Emit and Source Category Specific PTE
D. General Permitting for GHGs
1. What is a general permit?
2. What is the legal authority for general permits?
3. Have the states used general permits?
4. What steps has the EPA made toward developing general
permits?
5. General Permits and Title V
E. Presumptive BACT for GHGs
1. Definition of BACT
2. What is presumptive BACT?
3. How the EPA Could Consider Implementing Presumptive BACT
4. Possible Impediments to Presumptive BACT
F. Title V Empty Permits
VII. Request for Comment
A. Solicitation of Comment on Proposed Step 3
1. General
2. Call for Additional Information Concerning State Burdens
B. Solicitation of Comment on Streamlining Techniques
1. Plantwide Applicability Limitations for GHGs
2. Synthetic Minor Source Permitting Authority for GHGs
3. Redefining PTE and Source Category Specific PTE
4. General Permits for GHGs
5. Presumptive BACT for GHGs
VIII. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review and
Executive Order 13563: Improving Regulation and Regulatory 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 and Advancement Act
J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations
K. Determination Under Section 307(d)
IX. Statutory Authority
I. General Information
A. Executive Summary
1. Purpose of the Regulatory Action
The purpose of this ``Step 3'' rule is to continue the process of
phasing in GHG permitting requirements under the PSD and title V
programs begun in Steps 1 and 2 of the Tailoring Rule.\1\ As a result
of actions to regulate GHGs under other Clean Air Act (CAA or ``the
Act'') programs, GHGs are required to be addressed under the major
source permitting requirements of the Act's PSD and title V programs.
The Tailoring Rule is necessary because the statutory definitions that
have been used for other air pollutants to determine which sources are
``major sources'' subject to permitting under these programs are based
on annual emission rates of 100 or 250 tpy which, if implemented
immediately for GHGs, would bring so many sources into the programs as
to overwhelm the capabilities of state permitting authorities to issue
permits and potentially impede the ability of sources to construct or
modify their facilities.
---------------------------------------------------------------------------
\1\ ``Prevention of Significant Deterioration and Title V
Greenhouse Gas Tailoring Rule; Final Rule,'' 75 FR 31,514 (June 3,
2010) (the Tailoring Rule).
---------------------------------------------------------------------------
To prevent this outcome, the EPA promulgated the Tailoring Rule to
create a higher major source threshold for GHGs. In the Tailoring Rule,
we explained that ``[t]hese impacts * * * are so severe that they bring
the judicial doctrines of `absurd results,' `administrative necessity,'
and `one-step-at-a-time' into the Chevron two-step analytical framework
for statutes administered by agencies.'' Tailoring Rule, 75 FR at
31517. We further explained that on the basis of this legal
interpretation, we would phase-in the applicability of PSD and title V
to GHG-emitting sources so that those requirements would apply ``at
least to the largest sources initially, at least to as many more
sources as possible and as promptly as possible over time * * * and at
least to a certain point.'' Id. In the Tailoring Rule, we went on to
promulgate the first two steps of the phase-in program, which we call
Steps 1 and 2, and we made commitments for subsequent action.
Under Step 1 of the Tailoring Rule, which began on January 2, 2011,
sources above the GHG threshold that are required to obtain a PSD or
title V permit anyway due to emissions of other pollutants (referred to
as ``anyway'' sources) are required also to address their GHG emissions
in the permit. Under Step 2, which became effective on July 1, 2011,
sources with
[[Page 14228]]
GHG emissions above the Tailoring Rule threshold also are required to
obtain a PSD or title V permit, even if they would not be subject to
these programs based on emissions of other pollutants.
In the Tailoring Rule, the EPA also committed to this Step 3
rulemaking. For this rulemaking we have evaluated whether it is now
possible to lower the GHG major source threshold to bring additional
sources into the CAA permitting programs without overwhelming state
permitting authorities. In addition, we have continued our
identification and evaluation of potential approaches to streamline
permitting so as to enable permitting authorities to permit more GHG-
emitting sources without undue burden. The specific actions being
proposed today are briefly described in the following paragraphs.
2. Summary of Major Provisions
The EPA is proposing to leave the GHG major source thresholds
unchanged from the Step 2 level at this time. We have found that the
capabilities of the state permitting authorities have not improved to
the extent necessary for additional sources to be brought into the
system. This proposal is discussed further in section V of this
preamble.
We are also proposing to revise the PSD regulations to provide for
GHG PALs. A PAL establishes a site-specific plantwide emission level
for a pollutant that allows the source to make changes at the facility
without a PSD permit, provided that emissions to not exceed the PAL
level. Such PALs are already available under PSD for other pollutants,
and we are proposing to create provisions to allow for GHG PALs as
well. We believe that this action will streamline PSD permitting
programs by allowing sources and permitting authorities to address GHGs
one time for a source and avoid repeated subsequent permitting actions.
This action is discussed further in section VI.A of this preamble.
We are proposing regulatory provisions as well to allow for
``synthetic minor'' permits for GHGs under the federal PSD program.
Applicability under PSD and title V is triggered when a source ``emits,
or has the potential to emit'' a pollutant at a level greater than the
major source threshold. Under this system, there are some sources that
have the potential to emit a pollutant above the threshold (e.g., if
the source were to operate 24 hours per day, 7 days per week), but do
not have actual emissions above the threshold, due to physical or
operational limitations, and do not plan to ever have emissions that
great. The EPA has long allowed for such sources to voluntarily accept
enforceable limits on their emissions to keep them below the major
source threshold; such sources are referred to as ``synthetic minor''
sources. However, synthetic minor permits are typically issued by
states under their minor source NSR programs, and there is no generally
applicable federal minor NSR program. To allow for issuance of
synthetic minor permits for GHGs in all areas subject to the federal
PSD program, we are proposing to add GHG synthetic minor provisions to
the federal PSD program. We believe that permitting synthetic minor GHG
sources under these provisions will reduce the number of sources
subject to PSD and title V, reducing the burden on state permitting
authorities and the sources. This action is discussed further in
section VI.B of this preamble.
B. Does this action apply to me?
Entities affected by this action include sources in all sectors of
the economy, including commercial and residential sources. Entities
potentially affected by this action also include states, local
permitting authorities and tribal authorities. The majority of
categories and entities potentially affected by this action are
expected to be in the following groups:
----------------------------------------------------------------------------------------------------------------
Industry group NAICS \a\
----------------------------------------------------------------------------------------------------------------
Agriculture, fishing, and hunting. 11
Mining............................ 21
Utilities (electric, natural gas, 2211, 2212, 2213
other systems).
Manufacturing (food, beverages, 311, 312, 313, 314, 315, 316
tobacco, textiles, leather).
Wood product, paper manufacturing. 321, 322
Petroleum and coal products 32411, 32412, 32419
manufacturing.
Chemical manufacturing............ 3251, 3252, 3253, 3254, 3255, 3256, 3259
Rubber product manufacturing...... 3261, 3262
Miscellaneous chemical products... 32552, 32592, 32591, 325182, 32551
Nonmetallic mineral product 3271, 3272, 3273, 3274, 3279
manufacturing.
Primary and fabricated metal 3311, 3312, 3313, 3314, 3315, 3321, 3322, 3323, 3324, 3325, 3326, 3327,
manufacturing. 3328, 3329
Machinery manufacturing........... 3331, 3332, 3333, 3334, 3335, 3336, 3339
Computer and electronic products 3341, 3342, 3343, 3344, 3345, 4446
manufacturing.
Electrical equipment, appliance, 3351, 3352, 3353, 3359
and component manufacturing.
Transportation equipment 3361, 3362, 3363, 3364, 3365, 3366, 3366, 3369
manufacturing.
Furniture and related product 3371, 3372, 3379
manufacturing.
Miscellaneous manufacturing....... 3391, 3399
Waste management and remediation.. 5622, 5629
Hospitals/Nursing and residential 6221, 6231, 6232, 6233, 6239
care facilities.
Personal and laundry services..... 8122, 8123
Residential/private households.... 8141
Non-Residential (Commercial)...... Not available. Codes only exist for private households, construction and
leasing/sales industries.
----------------------------------------------------------------------------------------------------------------
\a\ North American Industry Classification System.
C. Where can I get a copy of this document and other related
information?
In addition to being available in the docket, an electronic copy of
this proposed rule will also be available on the World Wide Web.
Following signature by the EPA Administrator, a copy of this proposed
rule will be posted in the regulations and standards section of our New
Source Review (NSR) Web site, under Regulations & Standards, at https://www.epa.gov/nsr.
[[Page 14229]]
D. What should I consider as I prepare my comments for the EPA?
1. Submitting CBI
Do not submit this information to the EPA through
www.regulations.gov or email. Clearly mark the part or all of the
information that you claim to be CBI. For CBI information in a disk or
CD-ROM that you mail to the EPA, mark the outside of the disk or CD-ROM
as CBI and then identify electronically within the disk or CD-ROM the
specific information that is claimed as CBI. In addition to one
complete version of the comment that includes information claimed as
CBI, a copy of the comment that does not contain the information
claimed as CBI must be submitted for inclusion in the public docket.
Information so marked will not be disclosed except in accordance with
procedures set forth in 40 CFR Part 2. Send or deliver information
identified as CBI only to the following address: Roberto Morales, OAQPS
Document Control Officer (C404-02), Environmental Protection Agency,
Research Triangle Park, NC 27711, Attention Docket ID No. EPA-HQ-OAR-
2009-0517.
2. Tips for Preparing Your Comments
When submitting comments, remember to:
Identify the rulemaking by docket number and other
identifying information (subject heading, Federal Register date and
page number).
Follow directions--The agency may ask you to respond to
specific questions or organize comments by referencing a Code of
Federal Regulations (CFR) part or section number.
Explain why you agree or disagree; suggest alternatives
and substitute language for your requested changes.
Describe any assumptions and provide any technical
information and/or data that you used.
If you estimate potential costs or burdens, explain how
you arrived at your estimate in sufficient detail to allow for it to be
reproduced.
Provide specific examples to illustrate your concerns, and
suggest alternatives.
Explain your views as clearly as possible, avoiding the
use of profanity or personal threats.
Make sure to submit your comments by the comment period
deadline identified.
E. How can I find information about the public hearing?
Persons interested in presenting oral testimony should contact Ms.
Pamela Long, Air Quality Policy Division (C504-01), Environmental
Protection Agency, Research Triangle Park, NC 27711; telephone number
(919) 541-0641 or email long.pam@epa.gov at least 1 day in advance of
the public hearing. Persons interested in attending the public hearing
should also contact Ms. Long to verify the time, date and location of
the hearing. The public hearing will provide interested parties the
opportunity to present data, views or arguments concerning these
proposed rules.
F. What acronyms, abbreviations and units are used in this preamble?
The following acronyms, abbreviations and units are used in this
preamble:
AFUE.......................... Annual Fuel Utilization Efficiency
BACT.......................... Best Available Control Technology
CAA or Act.................... Clean Air Act
CFR........................... Code of Federal Regulations
CH4........................... Methane
CO2........................... Carbon Dioxide
CO2e.......................... Carbon Dioxide Equivalent
DOE........................... U.S. Department of Energy
EPA........................... U.S. Environmental Protection Agency
ECOS.......................... Environmental Council of the States
FIP........................... Federal Implementation Plan
FR............................ Federal Register
GHG........................... Greenhouse Gas
GP............................ General Permit
GWP........................... Global Warming Potential
HFCs.......................... Hydrofluorocarbons
ICR........................... Information Collection Request
LDVR.......................... Light-Duty Vehicle Rule
N2O........................... Nitrous Oxide
NAAQS......................... National Ambient Air Quality Standard
NACAA......................... National Association of Clean Air
Agencies
NRDC.......................... Natural Resources Defense Council
NSR........................... New Source Review
NTTAA......................... National Technology Transfer and
Advancement Act
OMB........................... Office of Management and Budget
PAL........................... Plantwide Applicability Limitation
PFCs.......................... Perfluorocarbons
PSD........................... Prevention of Significant Deterioration
PTE........................... Potential to Emit
RFA........................... Regulatory Flexibility Act
SBA........................... Small Business Administration
SF6........................... Sulfur Hexafluoride
SIP........................... State Implementation Plan
SNPR.......................... Supplemental Notice of Proposed
Rulemaking
TSD........................... Technical Support Document
tpy........................... Tons Per Year
UMRA.......................... Unfunded Mandates Reform Act
II. Overview of the Proposed Rule
In the Tailoring Rule, we included an enforceable commitment to
propose or solicit comment on what we call Step 3 of the process for
phasing in, or tailoring, the applicability thresholds at which GHG
emission sources are subject to the CAA PSD and title V permitting
requirements. We also stated in that rule that we would lower the
Tailoring Rule thresholds only after we determined that the states have
had enough time to develop the necessary infrastructure and increase
their GHG permitting expertise and capacity to efficiently manage the
expected increase in administrative burden, and only after we had the
opportunity to expedite GHG permit issuance through streamlining
measures. In addition, in the Tailoring Rule, we committed to complete
action on the Step 3 rulemaking by July 1, 2012, and to make the Step 3
rule effective on July 1, 2013. In the short period of time since the
EPA promulgated the Tailoring Rule, the states and we have made
progress in GHG permitting capacity and streamlining in some areas, but
not enough to justify lowering the thresholds at this time. As a
result, in this rulemaking, we propose to maintain Step 3 of the
Tailoring Rule at current levels.
In section III of this proposal, we discuss background information,
including the potential numbers of permit actions, amounts of GHG
emissions, and administrative costs of permit actions for the sources
that are potentially subject to GHG permitting for Step 3.
In section IV, we discuss the available information regarding the
impact that GHG permitting is having on permitting authorities. In
section V, we discuss our proposal to maintain the current
applicability requirements for GHG PSD and title V permitting at the
levels established under Steps 1 and 2 of the Tailoring Rule--which are
the first two steps in the Tailoring Rule's phase-in program for PSD
and title V applicability--which we generally refer to as the 100,000/
75,000 levels. Our basis for maintaining the current applicability
requirements stems from the Tailoring Rule itself, in which we
determined that with the Step 1 and 2 thresholds, permitting
authorities would be required to handle a large number of GHG
permitting actions that would impose significant administrative burdens
on the permitting authorities, and that lowering those thresholds in
Step 3 would bring in more permitting actions that in turn would add
more burden. Accordingly, we stated we would lower the GHG thresholds
only if certain criteria are met. The criteria are: (i) The development
of what we call streamlining measures that would make GHG permitting
more efficient, (ii) whether permitting authorities had the
[[Page 14230]]
time needed to ramp up their resources, and (iii) the ability of
sources to meet the requirements of the PSD program and the permitting
authorities' ability to issue timely permits.\2\ Information currently
available indicates that the permitting authorities are not
significantly better positioned now to process more GHG permits than
they were at the time we promulgated Steps 1 and 2 in the Tailoring
Rule. We also note that lowering the thresholds to include the
relatively low-emitting sources currently under consideration for Step
3 would result in a very small addition to the amount of GHG emissions
subject to permitting requirements while potentially adding thousands
of sources to the permitting process. For these reasons, we propose in
Step 3 to maintain, and not lower, the current applicability
thresholds.
---------------------------------------------------------------------------
\2\ 75 FR 31559.
---------------------------------------------------------------------------
As we committed to do in the Tailoring Rule, we have been exploring
a variety of approaches that could be used to streamline PSD and title
V permitting for sources of GHGs. In section VI, we discuss
streamlining techniques with the potential to make the PSD and title V
permitting programs more efficient to administer for GHG-emitting
sources, and propose two streamlining techniques. In section VI.A, we
propose to add provisions to the PSD regulations at 40 CFR 51.166 and
52.21 to better address PALs for GHGs. More specifically, we propose
regulatory changes to implement GHG PALs on either a mass-basis (tpy)
or a CO2e-basis, including for existing sources that are not
yet currently major for any regulated NSR pollutants and are not major
sources because of their GHG emissions, and we also propose allowing
PALs to be used as an alternative approach for determining both whether
a project is a major modification and whether GHG emissions are subject
to regulation. In section VI.B, we propose to add provisions to the PSD
regulations at 40 CFR 52.21 to create GHG synthetic minor source
permitting authority, in areas subject to a GHG PSD FIP. In doing so,
we propose changes to create the regulatory authority for the EPA to
issue synthetic minor limitations for GHG emissions to allow sources to
restrict emissions below the PSD applicability thresholds. A synthetic
minor limit may also allow sources to restrict emissions below the
title V permitting applicability threshold on a source-wide basis. We
also request comment on whether any states with approved SIPs lack
authority to issue GHG synthetic minor limitations.
In the rest of section VI, we discuss our progress in evaluating
the suitability of other streamlining options and request further
comment, for the purposes of both PSD and title V permitting, on
potential-to-emit calculations and the use of general permits; and for
PSD permitting, on the use of presumptive best available control
technology (BACT).
In section VII, we solicit comment on the full range of topics
discussed in this proposal. In addition, we call for additional
information from states as to their current and expected air permit
budgets as well as their current and expected future levels of
permitting based on the current thresholds and the possibility of lower
thresholds in the future.
III. Background
This section describes key aspects of the background for this
rulemaking. For other background information, such as a description of
GHGs and their sources, the regulatory backdrop to the Tailoring Rule,
and the EPA's GHG PSD and title V programs, see the Tailoring Rule, the
related actions that the EPA took shortly before finalizing the
Tailoring Rule,\3\ and the GHG PSD and title V implementation rules
that we call the GHG PSD SIP Call and GHG FIP,\4\ as well as the GHG
PSD and title V Narrowing Rules.\5\ For purposes of this proposal, we
assume that the reader is familiar with the above-referenced materials.
In the following paragraphs we provide a brief summary of key statutory
and regulatory background for the PSD permit and title V programs.
---------------------------------------------------------------------------
\3\ ``Endangerment and Cause or Contribute Findings for
Greenhouse Gases Under Section 202(a) of the Clean Air Act,'' 74 FR
66,496 (December 15, 2009) (the Endangerment and Cause-or-Contribute
Findings); ``Light-Duty Vehicle Greenhouse Gas Emission Standards
and Corporate Average Fuel Economy Standards; Final Rule,'' 75 FR
25,324 (May 7, 2010) (the Light-duty Vehicle Rule); ``Interpretation
of Regulations that Determine Pollutants Covered by Clean Air Act
Permitting Programs,'' 75 FR 17,004 (April 2, 2010) (the Timing
Decision or the Johnson Memo Reconsideration). In the ``Endangerment
Finding,'' which is governed by CAA section 202(a) in December 2009
the Administrator exercised her judgment to conclude that ``six
greenhouse gases taken in combination endanger both the public
health and the public welfare of current and future generations.''
The Administrator also found ``that the combined emissions of these
greenhouse gases from new motor vehicles and new motor vehicle
engines contribute to the greenhouse gas air pollution that
endangers public health and welfare under CAA section 202(a).'' 74
FR 66496. This Endangerment Finding led directly to promulgation of
what we call the ``Light-duty Vehicle Rule'' or the ``LDVR,'' also
governed by CAA section 202(a), in which EPA set standards for the
emission of greenhouse gases for new motor vehicles built for model
years 2012-2016. The Johnson Memo Reconsideration provided EPA's
interpretation of a pre-existing definition in its PSD regulations
delineating the ``pollutants'' that are taken into account in
determining whether a source must obtain a PSD permit and the
pollutants each permit must control. Regarding the Vehicle Rule, the
Johnson Memo Reconsideration stated that such regulations, when they
take effect on January 2, 2011, will, by operation of the applicable
CAA requirements, subject GHG-emitting sources to PSD requirements.
\4\ ``Action to Ensure Authority to Issue Permits under the
Prevention of Significant Deterioration Program to Sources of
Greenhouse Gas Emissions: Finding of Substantial Inadequacy and SIP
Call--Final Rule,'' 75 FR 77,698 (December 13, 2010) (the GHG PSD
SIP Call); ``Action to Ensure Authority to Issue Permits Under the
Prevention of Significant Deterioration Program to Sources of
Greenhouse Gas Emissions: Federal Implementation Plan; Final Rule,''
75 FR 82246 (December 30, 2010) (the GHG PSD SIP Call FIP).
\5\ ``Limitation of Approval of Prevention of Significant
Deterioration Provisions Concerning Greenhouse Gas Emitting Sources
in State Implementation Plans; Final Rule,'' 75 FR 82535 (December
30, 2010) (the PSD Narrowing Rule); ``Action to Ensure Authority to
Implement Title V Permitting Programs Under the Greenhouse Gas
Tailoring Rule; Final Rule,'' 75 FR 82254 (December 30, 2010) (the
Title V Narrowing Rule).
---------------------------------------------------------------------------
A. Statutory and Regulatory Background for PSD and Title V
Under the CAA, new major stationary sources of certain air
pollutants, defined as ``regulated NSR pollutants,'' and major
modifications to existing major sources are required to, among other
things, obtain a PSD permit prior to construction or major
modification. We refer to the set of requirements that determine which
sources and modifications are subject to PSD as the ``applicability''
requirements. Once major sources become subject to PSD, these sources
must, in order to obtain a PSD permit, meet the various PSD
requirements. For example, they must apply BACT, demonstrate compliance
with air quality related values and PSD increments, address impacts on
special Class I areas (e.g., some national parks and wilderness areas),
and assess impacts on soils, vegetation, and visibility. These PSD
requirements are the subject of Sections III and IV of this document.
In this section, we discuss how the CAA and relevant EPA
regulations describe the PSD applicability requirements. The CAA
applies the PSD requirements to any ``major emitting facility'' that
constructs (if the facility is new) or undertakes a modification (if
the facility is an existing source).\6\ The term ``major emitting
facility'' is defined as a stationary source that emits, or has a PTE
of, at least 100 TPY, if the source is in one of 28 listed source
categories, or, if the source is not, then at least 250 TPY, of ``any
air pollutant.'' 42 U.S.C. 7479(1). For existing facilities, the CAA
adds a definition of modification, which, in general, is any physical
or
[[Page 14231]]
operational change that ``increases the amount'' of any air pollutant
emitted by the source.\7\
---------------------------------------------------------------------------
\6\ 42 U.S.C. 7475(a), 7479(1).
\7\ 42 U.S.C. 7479(1), 7411(a)(4).
---------------------------------------------------------------------------
The EPA's regulations implement these PSD applicability
requirements through use of different terminology, and, in the case of
GHGs, with additional limitations. Specifically, the regulations apply
the PSD requirements to any major stationary source that begins actual
construction \8\ (if the source is new) or that undertakes a major
modification (if the source is existing).\9\ The term major stationary
source is defined as a stationary source that emits, or has a PTE of,
at least 100 TPY if the source is in one of 28 listed source
categories, or, if the source is not, then at least 250 TPY, of
regulated NSR pollutants.\10\ We refer to these 100- or 250-TPY amounts
as the major source limits or thresholds. A major modification is
defined as ``any physical change in or change in the method of
operation of a major stationary source that would result in: a
significant emissions increase [ ] of a regulated NSR pollutant [ ];
and a significant net emissions increase of that pollutant from the
major stationary source.'' \11\ EPA rules specify what amount of
emissions increase is ``significant'' for listed regulated NSR
pollutants (e.g., 40 TPY for sulfur dioxide, 100 TPY for carbon
monoxide), but for any regulated NSR pollutant that is not listed in
the regulations, any increase is significant.\12\
---------------------------------------------------------------------------
\8\ 40 CFR 52.21(b)(11).
\9\ 40 CFR 52.21(a)(2).
\10\ 40 CFR 52.21(b)(1)(i).
\11\ 40 CFR 52.21(b)(2)(i) and the term ``net emissions
increase'' as defined at 40 CFR 52.21(b)(3).
\12\ 40 CFR 52.21(b)(23)(i)-(ii).
---------------------------------------------------------------------------
A pollutant is a ``regulated NSR pollutant'' if it meets at least
one of four requirements, which are, in general, any pollutant for
which EPA has promulgated a NAAQS or a new source performance standard
(NSPS), certain ozone depleting substances, and ``[a]ny pollutant that
otherwise is subject to regulation under the Act.'' \13\ PSD applies on
a regulated-NSR-pollutant-by-regulated-NSR-pollutant basis. The PSD
requirements do not apply to regulated NSR pollutants for which the
area is designated as nonattainment. Further, some modifications are
exempt from PSD review (e.g., routine maintenance, repair and
replacement).\14\
---------------------------------------------------------------------------
\13\ 40 CFR 52.21(b)(50).
\14\ 40 CFR 52.21(b)(2)(iii).
---------------------------------------------------------------------------
Under the CAA, title V applies to a ``major source,'' which is
defined to include any stationary source that is a ``major stationary
source'' under section 302 of the Act.\15\ CAA Sec. 501(2). Under
section 302, a ``major stationary source'' is defined as any stationary
facility or source of air pollutants which directly emits, or has the
potential to emit, 100 tpy or more of any air pollutant.\16\ The title
V regulations define a ``major source'' in 40 CFR 70.2.
---------------------------------------------------------------------------
\15\ CAA Sec. 501(2).
\16\ CAA Sec. 302(j).
---------------------------------------------------------------------------
In the Tailoring Rule, the EPA promulgated, for the first time, a
regulatory definition of the term ``subject to regulation'' for
purposes of the PSD regulations, and included that term, as defined, in
the title V regulations. Under the Tailoring Rule regulations, a
pollutant is ``subject to regulation'' if, in general, the pollutant is
subject to actual control of the quantity of emissions (as opposed to,
for example, being subject only to monitoring requirements). E.g., 40
CFR 51.166(b)(48), 40 CFR 70.2. In addition, the Tailoring Rule also
provides a special rule for GHGs, which provides that GHGs become
pollutants ``subject to regulation,'' and therefore subject to PSD and
title V, if they meet the following two-step phase-in thresholds. Step
1 applies the applicable requirements of PSD, including the BACT
requirement to projects that increase net GHG emissions by the
applicable threshold (75,000 tpy CO2e) provided these
projects would be subject to PSD anyway by significantly increasing
emissions of at least one non-GHG pollutant. Under Step 1, for the
title V program, only sources with current title V permits for non-GHG
pollutants will have to address GHGs.
Step 2 then expands the program by phasing in additional large
sources of GHG emissions that are not already subject to PSD or title V
permitting requirements due to non-GHG emissions. In Step 2, PSD and
title V requirements will apply to new sources that emit, or have the
potential to emit, at least 100,000 tpy CO2e. For existing
sources, Step 2 applies title V requirements to existing sources that
emit, or have the potential to emit, 100,000 tpy CO2e and
that are not already subject to title V requirements, and also applies
PSD requirements to those sources that emit, or have the potential to
emit, 100,000 tpy CO2e and undertake a modification that
increases net emissions by at least 75,000 tpy CO2e. See 75
FR 31516.
In the Tailoring Rule, the EPA explained that ``we selected the
`subject to regulation' mechanism'' as the legal mechanism for
establishing the phase-in thresholds because we had received
information that states could more expeditiously adopt those thresholds
through that mechanism. The EPA added that ``our action in this
rulemaking [in establishing the phase-in thresholds] should be
interpreted to rely on any of several legal mechanisms to accomplish
this result * * * [including] revising the meaning of several terms in
the [PSD] definition [ provisions].'' 75 FR 31582. In this manner, EPA
identified several legal bases within the definitional previsions of
the PSD regulations to support the phase-in approach.
B. How does the Tailoring Rule address GHG emissions under PSD and
Title V? \17\
---------------------------------------------------------------------------
\17\ We include this discussion of the Tailoring Rule for
background purposes only. We do not reopen for comment any of the
determinations made in the Tailoring Rule or our rationale for them.
---------------------------------------------------------------------------
In the Tailoring Rule, the EPA explained that the rulemaking was
necessary because without it, the CAA PSD preconstruction review
permitting program and the title V operating permit program would,
under a literal reading of those provisions, apply to all stationary
sources that emit or have the potential to emit more than 100 or 250
tpy of GHGs beginning on January 2, 2011. This was the date when the
EPA's recently promulgated Light Duty Vehicle Rule (LDVR) took effect,
imposing control requirements for the first time on carbon dioxide
(CO2) and other GHGs, thereby making them subject to
regulation and triggering the PSD and title V permitting requirements.
Therefore, a source owner proposing to construct any new major source
that would emit or have the potential to emit at or higher than the
100/250 tpy applicability levels (and which therefore may be referred
to as a ``major'' source) or modify any existing major source in a way
that would increase GHG emissions, would need to obtain a permit under
the PSD program that addresses these emissions before construction or
modification could begin. Similarly, title V would apply to a new or
existing GHG source exceeding the 100 tpy applicability threshold in
the Act.
In the Tailoring Rule, we further explained that under these
circumstances, and in the absence of streamlining methods, state and
local permitting authorities would be burdened by the need to issue PSD
permits to tens of thousands of small sources (including, for example,
many commercial sources and small industrial sources) and to issue
title V permits to millions of small sources (including, for example,
many residential sources).
[[Page 14232]]
These extraordinary numbers of permit applications are orders of
magnitude greater than the current inventory of annual applications and
would vastly exceed the current administrative resources of the
permitting authorities. Permit gridlock would result with the
permitting authorities able to issue only a tiny fraction of the
permits requested.
In the Tailoring Rule, we further explained that ``[t]hese impacts
* * * are so severe that they bring the judicial doctrines of `absurd
results,' `administrative necessity,' and `one-step-at-a-time' into the
Chevron two-step analytical framework for statutes administered by
agencies.'' Tailoring Rule, 75 FR at 31517. We further explained that
on the basis of this legal interpretation, we would phase-in the
applicability of PSD and title V to GHG-emitting sources so that those
requirements would apply ``at least to the largest sources initially,
at least to as many more sources as possible and as promptly as
possible over time * * * and at least to a certain point.'' Id. In the
Tailoring Rule, we went on to promulgate the first two steps of the
phase-in program, which we call Steps 1 and 2, and we made commitments
for subsequent action.
In the Tailoring Rule, we closely reviewed the numbers of
additional permitting actions for GHG-emitting sources, and the
resulting administrative burdens, that would occur at various
permitting thresholds. For example, we estimated the following
permitting burdens associated with the Step 1 and Step 2 thresholds,
compared to the administrative burdens of the then-current PSD and
title V programs (that is, before applicability to GHG-emitting
sources):
Step 1:
Number of sources subject to PSD and title V permitting: The same
as prior to Step 1
Additional workload hours PSD program: 34,000 at a cost of $3
million
Additional workload hours title V program: 27,468 at a cost of $1
million
Step 2:
Number of additional sources subject to PSD permitting: 2 new
sources, 915 modified sources
Additional workload hours PSD program: 310,655 at a cost of $24
million
Number of additional sources subject to title V permitting: 190
sources for each of the first 3 years
Additional workload hours title V program: 141,322 at a cost of $7
million
75 FR 31541.
We further estimated that the combined additional PSD and title V
permitting burdens after implementation of Steps 1 and 2 would, on an
annual basis, mean a 42 percent increase in costs over the then-current
PSD and title V program. 75 FR 31540, Table V-1.
C. In the Tailoring Rule, what commitments did the EPA make for Step 3?
In the Tailoring Rule, we noted that ``following implementation of
the first phase of PSD and title V applicability to GHG sources,
generally at the [proposed] threshold, additional action would be
required over time to assure full compliance with the statute.'' 75 FR
31571. Accordingly, we included in the Tailoring Rule an enforceable
commitment to issue a notice of proposed rulemaking in which we would
propose or solicit comment on a third step of the phase-in, which we
call Step 3. We committed to complete Step 3 by July 1, 2012, and to
make Step 3 effective by July 1, 2013. We committed to solicit comment
on lowering the thresholds, so that more sources would be subject to
PSD and title V requirements, 40 CFR 52.22(b)(1), 40 CFR 70.12(b)(1),
but we did not commit to either propose or finalize lower thresholds.
We further stated that in light of the administrative burdens, we would
not, in Step 3, lower the thresholds below the 50,000/50,000 tpy
CO2e levels.
In the Tailoring Rule, we recognized that lowering the thresholds
in Step 3, and thereby bringing more sources into PSD and title V
permitting, would mean that the permitting authorities would confront
even greater administrative burdens. For example, we estimated that
lowering the thresholds to the 50,000/50,000 level would increase
administrative costs by 40 percent above administrative costs
associated with Step 2.\18\ Accordingly, we explained that whether we
could lower the thresholds in Step 3 depended on (i) whether the EPA
could develop streamlining measures, (ii) the time that permitting
authorities need to ramp up their resources, and (iii) sources'
abilities to meet the requirements of the PSD program and permitting
authorities' ability to issue timely permits. 75 FR 31524. We
elaborated:
---------------------------------------------------------------------------
\18\ 75 FR 31540 (Table V-1).
---------------------------------------------------------------------------
(2) Criteria for Establishing Phase-in Schedule
The specific phase-in schedule under the tailoring approach will
depend on several things. The first is our progress in developing
streamlining methods that will render the permitting authority
workload more manageable by taking some sources off the table
(through regulations or guidance interpreting ``potential to
emit''), and by allowing for more efficient permit processing
(through general permits and presumptive BACT). At the same time,
streamlining techniques will lower permitting costs to sources or
even eliminate some sources' obligations to obtain permits
altogether. The second is the time that permitting authorities need
to ramp up their resources in an orderly and efficient manner to
manage the additional workload. The third is information we have as
to the sources' abilities to meet the requirements of the PSD
program and the permitting authorities' ability to process permits
in a timely fashion. That information will be based on the real-
world experience the permitting authorities will accumulate as they
proceed to process permit application for the larger GHG sources.
Thus, under our present approach, we will develop streamlining
techniques, we expect the permitting authorities to ramp up
resources in response to the additional demands placed upon them in
the first two steps, and we will gather real world- information
about the GHG permitting process; and based on all that, we will
address expanding the PSD program in a step-by-step fashion to
include more sources over time. We intend to follow this process to
establish * * * the PSD applicability thresholds * * *.
75 FR 31559. With respect to the third criterion, we note that in the
Tailoring Rule, we made clear that sources' abilities to meet the
requirements of the PSD and title V programs depend at least in part on
the ability of the states to develop, as part of the state programs,
outreach and educational efforts to facilitate source compliance.
Accordingly, for present purposes, we think this component concerning
sources may be examined by a review of the states' progress in
developing state GHG permitting programs. We also note that permitting
authorities' abilities to issue timely GHG permits may be measured by
the extent of any permitting backlog, and depend in large part on the
permitting authorities' development of expertise. In this rulemaking,
we seek information from the states as to their ability to issue timely
permits, including data concerning their backlog, but we also are
examining, more broadly, the states' progress in developing expertise
in GHG permitting.
D. In the Tailoring Rule, what plan did the EPA announce for developing
streamlining measures?
In the Tailoring Rule, we announced a plan to explore streamlining
techniques that could make the permitting programs more efficient to
administer for GHGs, and that therefore
[[Page 14233]]
could allow expanding those programs to smaller sources. Streamlining
techniques to be evaluated include: (1) Defining PTE for various source
categories, (2) establishing source category emission limits for
presumptive BACT, (3) establishing general permits and permits-by-rule,
(4) establishing a process for electronic permitting, and (5)
establishing a process for lean techniques for more efficient
permitting processes. We believe that these techniques have the
potential to streamline the PSD and title V permitting programs for
GHGs to ``allow the expeditious expansion of PSD and title V
applicability to more GHG-emitting sources while protecting those
sources and the permitting authorities from undue expenses.'' 75 FR
31526.
While we intend to move forward and develop streamlining
approaches, we also stated in the Tailoring Rule that we did not expect
to develop and implement any of these prior to Step 2. We also stated
in the rule that several of these streamlining approaches will take
several years to develop, requiring separate rulemaking both at the
federal level, and then through state and local processes. We,
nonetheless, committed to explore a number of possible streamlining
actions prior to the Step 3 rulemaking.
In addition, with respect to title V, in the Tailoring Rule we
noted that commenters on the proposal for that rule stated that the EPA
should apply the title V program only to sources that are subject to
applicable requirements, so that sources should not be required to hold
``empty permits'' (e.g., permits issued to a source that is not subject
to any applicable requirement for any pollutant). In the Tailoring
Rule, we recognized that not requiring sources to hold such ``empty
permits'' is a potential means for relieving title V permitting
burdens. [75 FR 31566.] We also stated that--
We need to gather more information concerning the potential
number and utility of ``empty permits'' for GHG sources, in light of
the fact that the need for requirements in title V permits will vary
based on the requirements of each SIP, and the fact that some SIPs
contain broadly applicable requirements.
75 FR 31566. We added that in the Step 3 rulemaking, ``we may consider
whether to limit title V applicability to GHG sources in order to
minimize the number of GHG sources with `empty' permits.'' Tailoring
Rule, 75 FR 31567.
E. In the Tailoring Rule, what commitments did the EPA make for
subsequent action?
In addition, in the Tailoring Rule, we established an enforceable
commitment that we will (i) complete a study by April 30, 2015, to
evaluate the status of PSD and title V permitting for GHG-emitting
sources, including progress in developing streamlining techniques; and
(ii) complete further rulemaking (which we refer to as Step 4), based
on that study by April 30, 2016, to address the permitting of smaller
sources. That rulemaking may also consider additional permanent
exclusions based on the ``absurd results'' doctrine, where applicable.
In the Tailoring Rule, we also included a provision assuring that
no source with emissions or potential to emit below 50,000 tpy
CO2e, and no modification resulting in an increase and a net
GHG increases of less than 50,000 tpy CO2e, would be subject
to PSD or title V permitting before April 30, 2016. We included this
provision on the basis of our conclusion that the administrative
burdens that would accompany permitting sources below the 50,000 tpy
threshold would be so great that it would be impossible to administer
the permit programs for these sources until at least 2016, even with
the streamlining actions that the EPA may be able to develop, and the
increases in permitting resources that we reasonably expect the
permitting authorities to acquire.
IV. Available Information on GHG Permitting
To support this Step 3 rulemaking, the EPA has gathered additional
information on the impact that GHG permitting is having on permitting
authorities at the current threshold levels and the potential impact
that would result from a reduction in the GHG permitting thresholds to
levels as low as 50,000 tpy CO2e. Section IV.A discusses the
actual permitting that has occurred since January 1, 2011. Section IV.B
discusses information gathered through preliminary consultations with
eight state PSD permitting authorities, as well as, experience garnered
from the EPA regional offices that are the PSD permitting authorities
for certain states.\19\ Section IV.C presents information from an
analysis of the number of existing and new sources that would be
potentially major sources of GHGs at a range of thresholds between the
current level of 100,000 tpy CO2e and 50,000 tpy
CO2e.
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\19\ In the title V program, the responsible permitting agency
is referred to as the ``permitting authority,'' while in the PSD
program, this entity is referred to as the ``reviewing authority.''
We use the two terms interchangeably in this preamble.
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A. GHG Permitting Activity to Date
As of December 1, 2011, the EPA and state permitting authorities
had issued 18 PSD permits with GHG requirements. We also estimate that
as of that date, the EPA and state permitting authorities had received
an additional 50 GHG PSD permit applications. The types of source
categories for which permitting authorities have issued GHG permits
include: biofuel production, cement plants, electric generating units,
lime production facilities, outer continental shelf exploration, pulp
and paper mills, and refineries. Eleven states and three EPA regions
issued these permits. In most cases, no permitting authority issued a
permit for the same source category more than once. We discuss in
section V the extent to which these permitting actions have provided
information relevant to Step 3.
B. Consultations With States
To obtain additional information on the current status of GHG
permitting based on the implementation of Step 1 and Step 2 and the
potential impact of reducing the GHG thresholds in Step 3, we consulted
with eight state permitting authorities--Iowa, Louisiana, Michigan, New
Jersey, North Carolina, Pennsylvania, South Dakota and Utah--all of
which have experience with GHG permitting, and which represent a cross-
section of state programs geographically and in terms of population and
types of sources. In addition, we reviewed the experience of the EPA
regional offices that act as PSD permitting authorities in state
jurisdictions: Region 4, which issues PSD permits for GHG emissions in
Florida and for all regulated pollutant emissions from outer
continental shelf sources in the eastern portion of the Gulf of Mexico;
Region 6, which issues PSD permits for GHG emissions in Arkansas and
Texas; and Region 9, which issues PSD permits for all regulated
pollutants in many of the local air quality management districts in
California. For additional information concerning responses to the
survey, please refer to the Docket ID No. EPA-HQ-OAR-2009-0517.
These states and regional offices confirm that they have not yet
experienced the increase in the number of major source permitting
actions that was predicted to result from the implementation of Step 1
and Step 2. They generally do not believe that 2011 has been
representative of the permitting burdens that they expect will
[[Page 14234]]
ultimately occur under the current Tailoring Rule.
In addition, the states confirmed that to this point, they have not
been able to build up their GHG permitting infrastructure. For example
the permitting activity to date has provided limited, if any,
opportunity to build internal capacity to handle GHG permitting for a
diverse set of sources or more efficiency for any particular source
category. Similarly, the lack of permitting experience greatly
diminished the opportunity to develop meaningful streamlining
approaches to address GHG permitting. As a result, states indicated
that they have made little or no progress in implementing streamlining
measures, and have not adopted any such measures specifically to
address GHGs.
C. Additional Technical Support for the Step 3 Rule
To support the decision-making process for this Step 3 rule, the
EPA carried out an analysis to estimate the number of facilities that
would exceed different GHG emissions threshold levels.\20\ This
analysis built upon analysis the EPA included in the Tailoring Rule to
support the threshold decisions in that action.\21\ In the Tailoring
Rule analysis, the EPA evaluated eight different PTE thresholds between
100 and 100,000 tpy CO2e, including 50,000 tons per year.
For this Step 3 analysis, the EPA evaluated nine additional thresholds
between 50,000 and 100,000 tpy CO2e in 5,000 tpy increments
(that is, 55,000 through 95,000 tpy CO2e). The EPA
considered stationary sources in the following sectors:
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\20\ See Technical Support Document ``Summary of Methodology and
Data Used to Evaluate Resource Requirements at Alternative
Greenhouse Gas (GHG) Permitting Thresholds'' (December 2011).
\21\ See ``Technical Support Document for Greenhouse Gas
Emissions Thresholds Evaluation,'' March 29, 2010, Docket No. EPA-
HQ-OAR-2009-0517-19158.
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Electricity Generation (facilities with fossil fuel-fired
electric generating units);
Industrial sources (14 subcategories of industries with
process and combustion GHG emissions);
Energy (oil and gas extraction, transport, and processing;
underground coal mining);
Waste Treatment (landfills and municipal solid waste
incinerators);
Agriculture (stationary fuel combustion);
Commercial (stationary fuel combustion); and
Residential (stationary fuel combustion).
For each sector, the analysis estimated the number of sources that
would become major sources for GHGs at each of the different threshold
levels and the number of new major sources projected to be added each
year. The study found that at a Step 3 major source threshold of 50,000
tpy CO2e, approximately 4,650 additional sources would
become major sources of GHGs (increasing from 5,326 at 100,000 tpy
CO2e, to 9,980 at 50,000 tpy). About half of these would be
in the ``unspecified industrial stationary combustion'' subcategory of
industrial facilities; 16 percent in the waste treatment sector,
landfill subcategory; 14 percent in the energy sector, oil and gas
subcategory; 12 percent in the commercial/stationary fuel combustion
sector; 4 percent in the electricity generation sector and the
remaining 4 percent scattered among the remaining sectors and
industrial subcategories. At a threshold of 80,000 tpy CO2e
the number of commercial sources that become major sources of GHGs
significantly increases (compared to 100,000 tpy CO2e) and
at a threshold of 55,000 tpy CO2e, some multi-family
residential sources become major sources. The analysis found that no
sources in the agricultural or single family residential categories
would become major sources of GHGs at a threshold of 50,000 tpy
CO2e. Note that this analysis did not differentiate between
sources that become major only because of the source's GHGs emissions
from sources that are already major for one or more other pollutants.
The EPA's analysis identified sources that would become subject to
permitting requirements because of GHG emissions alone.\22\ Based on
this analysis, we estimate that a reduction from the current Step 2
threshold to 50,000 tpy CO2e would result in nearly 3,000
sources becoming major sources due to their GHG emissions alone
(increasing from 552 sources at 100,000 tpy CO2e, to 3,539
at 50,000 tpy). In addition, we estimate that 1,014 additional
modifications would be subject to PSD permitting based on GHG emissions
at 50,000/50,000 tpy CO2e versus the Step 2 thresholds of
100,000/75,000 (increasing from 917 per year to 1,931).
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\22\ See ``Summary of Methodology and Data Used to Evaluate
Resource Requirements at Alternative Greenhouse Gas (GHG) Permitting
Thresholds,'' December 2011.
---------------------------------------------------------------------------
In addition to determining the amount of potential additional
permit actions associated with the various thresholds, the EPA also
determined the administrative burdens associated with those actions. To
do so, the EPA relied on the same per-permit administrative cost
figures used in the Tailoring Rule for both PSD and title V permitting,
for both commercial/residential sources and industrial sources, as well
as for both new construction and modifications.\23\ The EPA also
determined the amount of GHG stationary source emissions associated
with the sources potentially affected by the various thresholds.
---------------------------------------------------------------------------
\23\ We note that none of the challenges to the Tailoring Rule
have addressed these burden estimates; we have not revisited them
for purposes of this rule, nor are we are re-opening them for
comment.
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To determine the impacts of lowering the thresholds in Step 3, the
EPA compared the amounts of administrative costs and GHG inventory
covered at the various cut-points to the amounts at the 100,000/75,000
Step 2 levels.\24\ For example, with respect to the PSD administrative
costs, as we stated in the Tailoring Rule, 75 FR 31540 (Table V-1), at
the 100,000/75,000 Step 2 levels, we expect annual PSD permitting
actions for GHG-emitting sources to include 242 newly constructed
sources and 1,365 modifications (917 for GHG emissions alone plus 448
for anyway sources) and we expect that these PSD GHG permitting actions
would increase permitting authority administrative burdens by 42
percent above existing total air permitting burdens (including
permitting for conventional (i.e., non-GHG pollutants under Tailoring
Rule Step 1), because these actions would trigger permitting
requirements for both PSD and title V. In total, we estimate the
facilities meeting the Step 2 major source applicability thresholds
account for approximately 67 percent of the total national stationary
source GHG emissions. At the 50,000/50,000 levels, the EPA estimates
annual PSD permitting actions involving GHG-emitting sources to include
243 newly constructed sources and 2,379 modifications (1 more newly
constructed source and 1,014 more modifications than at the 100,000/
75,000 level). While the EPA estimates these GHG permitting actions to
increase permitting authority administrative burdens by 40 percent
above the total burdens at Step 2 levels (and 99% above the
administrative burdens without GHG permitting), we estimate the
facilities meeting these major source applicability thresholds to
account for approximately 70 percent of
[[Page 14235]]
total national stationary source GHG emissions, just three percent more
than currently covered under Step 2. For a more complete description of
the EPA's analysis and an explanation, see the Technical Support
Document titled, ``Summary of Methodology and Data Used to Evaluate
Resource Requirements at Alternative Greenhouse Gas (GHG) Permitting
Thresholds'' (December 2011).
---------------------------------------------------------------------------
\24\ This level refers to new sources as well as existing
sources that are not ``anyway'' sources and that emit, or have the
potential to emit, at least 100,000 tpy CO2e, as well as
existing sources that emit or have the potential to emit at least
100,000 tpy CO2e and that undertake a modification that
increases net emissions of GHGs by at least 75,000 tpy
CO2e.
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V. Proposed Step 3 Rule
A. Overview
The Tailoring Rule's phase-in approach is based on data concerning
the numbers of GHG permitting actions the permitting authorities would
have to undertake and the costs of those actions--both absolute and in
comparison to their current budgets--at various different thresholds
for the applicability of PSD and title V to GHG-emitting sources. In
the Tailoring Rule, we began the phase-in by establishing Steps 1 and
2, which applied PSD and title V to ``anyway'' sources \25\ and sources
emitting GHGs at the 100,000/75,000 tpy CO2e level. To do
so, we determined that permitting authorities could handle the hundreds
of additional permitting actions that would occur under Steps 1 and 2,
even though the authorities' administrative costs would increase by 42
percent over their then-current administrative costs for both PSD and
title V programs.
---------------------------------------------------------------------------
\25\ We refer to these sources as ``anyway'' sources because
they will become subject to PSD for their GHG emissions if they
undergo PSD permitting anyway, either for new construction or for
modification projects, based on emissions of non-GHG pollutants;
and, by the same token, the will become subject to title V for their
GHG emissions if they are subject to title V anyway due to their
non-GHG emissions.
---------------------------------------------------------------------------
The present rulemaking represents the fulfillment of our commitment
in the Tailoring Rule to undertake Step 3 of the GHG PSD and title V
phase-in process. At this time, because of the limited amount of new
construction and modifications that sources have undertaken in the past
year, we believe state permitting authorities have not had sufficient
time and opportunity to develop the necessary infrastructure and
increase their GHG permitting expertise and capacity, which makes it
administratively infeasible to apply PSD and title V permitting
requirements to additional sources. Accordingly, we are proposing to
leave the applicability thresholds for GHGs unchanged.
In the Tailoring Rule, we committed to undertake future rulemaking,
including this Step 3 rulemaking, to examine whether we could lower the
thresholds to, potentially, as low as 50,000/50,000, and thereby apply
PSD and title V to more sources. We recognized that lowering the
thresholds would add more administrative costs on top of those added by
Steps 1 and 2, and as a result, we stated that whether and when we
would lower the thresholds would depend on the pace at which the EPA
and permitting authorities could develop streamlining measures to
expedite permit program administration and permitting authorities could
hire and train staff, as well as gain experience with GHG permitting.
Specifically, we indicated that further phase-in of GHG applicability
would depend on three criteria: (i) Whether the EPA could develop
streamlining measures, (ii) the time that permitting authorities need
to ramp up their resources, and (iii) sources' abilities to meet the
requirements of the PSD program and permitting authorities' abilities
to issue timely permits.
As described in the following, the states and the EPA have made
some progress in these areas. For example, the states have issued some
GHG permits and we are proposing streamlining measures in this
rulemaking. However, neither the states nor the EPA have had the
opportunity to make significant progress in these areas. First, the
states have had only limited experience in GHG permitting and therefore
have not had the opportunity to develop significant expertise. The main
reasons for this are the unexpectedly low number of PSD permit
applications submitted to date and the short amount of time since GHG
permitting began. As the volume of PSD permit applications increases,
EPA expects that more permitting authorities will further develop the
necessary specialized expertise required for case-by-case review of GHG
permit applications, including the establishment of a robust GHG BACT
record. Second, the states have not been able to develop their GHG
permitting infrastructure--e.g., hiring additional personnel,
establishing policies and conducting outreach programs to sources
unfamiliar with the permitting process--largely because their
permitting resources have not increased and, in fact, in some cases
have decreased and may decrease further in the near future. Similarly,
for title V, applications for title V permits are not generally due
until a year after title V becomes applicable to a source. Thus, for
Step 2 title V sources, permit applications are generally not due until
July 1, 2012, and states have not gained title V permitting experience.
Third, we have not had the opportunity to develop significant
streamlining approaches, largely because, as we stated in the Tailoring
Rule, certain streamlining approaches require a longer process. Because
of these reasons and following the criteria, described in the Tailoring
Rule, we are establishing Step 3 at the current levels.
The following discusses these criteria, beginning with the ability
of states to ramp up and build infrastructure, and notes the states'
and our experience with GHG permitting to date under the current Step 1
and Step 2 applicability thresholds. We also address the additional two
criteria noted above and the environmental benefits potentially
associated with any further reduction in the GHG PSD permitting
thresholds.
B. Have states had adequate time to ramp up their resources?
A criterion that we described in the Tailoring Rule for whether to
lower the thresholds in Step 3 was whether the permitting authorities
could increase their resources. As discussed previously in the
background section, we stated in the Tailoring Rule that we expected
Steps 1 and 2 to result in an increase in PSD permits for new
construction and modifications and in title V permits. We estimated
that Steps 1 and 2 would result in a 42 percent increase in
administrative burdens for permitting authorities. We expected that
some increase in state permitting resources would be needed to
accommodate, at least in part, those new demands.
As noted, to this point states have not been confronted with the
amount of GHG permit applications that we had expected in the Tailoring
Rule for Steps 1 and 2. EPA estimates that the unexpected small number
of permit applications to this point reflect the economic downturn,
which has depressed new construction and modifications. The number of
permit applications in a given year is based on individual business
decisions which we believe are directly linked to the economic
situation. The Agency expects that this situation will be short-lived,
and that the pace of permitting will pick up as economic conditions
improve and as GHG permitting becomes better established. Thus, it is
prudent for states to continue to plan on confronting additional
administrative demands expected as part of Steps 1 and 2. As discussed
in the following, they have confronted other administrative burdens as
well and if the thresholds are lowered in Step 3, they will confront
still more administrative burdens. Importantly, based on our
consultations with a limited number of states, we do not believe that
states have had the opportunity to obtain the necessary
[[Page 14236]]
resources and to develop their infrastructure to accommodate the level
of permitting expected in Steps 1 and 2.
In addition, an August 2011 report by the Environmental Council of
the States (ECOS) \26\ emphasizes the continued need for additional
resources before full implementation of the program can begin. It also
notes that permitting authorities expect workloads to double or triple
as a result of applications for synthetic minor limits to sources who
wish to avoid GHG permitting.
---------------------------------------------------------------------------
\26\ S. Brown, A. Fishman, ``The Status of State Environmental
Agency Budgets, 2009-2011,'' Steven Brown, Executive Director, and
Adam Fishman, Intern.
---------------------------------------------------------------------------
Further, as quantified in the Tailoring Rule, lowering the
thresholds would increase those burdens. We have estimated that
lowering the thresholds to 60,000/60,000 would increase administrative
burdens by 20 percent above the total burdens at Step 2 levels (and 40
percent above the pre-GHG permitting burdens). As noted above, lowering
them to 50,000/50,000 would increase administrative burdens by 40
percent above the total burdens at Step 2 levels (and 99 percent above
the pre-GHG permitting burdens). As we discussed in the Tailoring Rule,
lowering applicability thresholds would trigger requirements for more
sources that never before have been regulated under the PSD and title V
permitting programs. As a result, permitting agencies will need to
conduct an education and outreach program to raise awareness and
understanding of the regulatory requirements for these smaller sources.
Absent this outreach effort, we believe that many sources will not
understand, and perhaps may not even be aware of, their new regulatory
obligations.
Finally, we note that certain procedural aspects of the GHG
permitting process have proved to be more resource- and time-intensive
for states than anticipated at the time of the Tailoring Rule. In the
final Tailoring Rule, we finalized the applicability thresholds within
the definition of ``subject to regulation,'' instead of within the
``major stationary source'' definition. We made this change in
regulatory approach because we received information indicating that
many states could adopt the applicable thresholds through a regulatory
interpretation of the term ``subject to regulation,'' instead of a SIP
revision.\27\ Since finalizing the Tailoring Rule, we discovered that
in fact, very few states were able to adopt the applicable thresholds
by interpretation alone, and instead needed SIP revisions to be able to
regulate GHGs under their approved PSD programs at the levels of the
final Tailoring Rule. Moreover, some states were obliged to invoke
emergency procedures to expedite revision of their state laws. This
unexpected, additional state process required for adopting the
Tailoring Rule thresholds may have delayed some states in developing
their permitting program infrastructure.
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\27\ As discussed in the preamble to the final Tailoring Rule
(75 FR 31581), we participated in teleconferences with 1 local and 6
state agency permitting authorities on this topic, and they
generally agreed that this approach would better facilitate state
incorporation of the limitations in the final rule. We therefore
concluded that it was likely that the state rules were sufficiently
open-ended to apply EPA's approach by interpretation (although some
states might elect to pursue rulemaking in addition to or instead of
interpretation).
---------------------------------------------------------------------------
By the same token, for title V programs, we believed that many
states could adopt the Tailoring Rule thresholds through a regulatory
interpretation of the term ``subject to regulation,'' and that this
approach would allow permitting authorities to implement title V for
GHGs quickly with little rulemaking burden. However, as it has
happened, most states need to change the state laws and/or regulations
governing their title V programs to be able to permit GHGs at the
Tailoring Rule threshold levels. In fact, it turned out that only 5
state programs and numerous local districts in California, did not need
to enact program revisions.
In the Tailoring Rule, we expected that over time, permitting
authorities would have the opportunity to increase their resources to
allow them to process more GHG permit applications in a timely fashion.
To this point, we see little evidence that permitting authorities could
increase resources and, in fact, permitting authorities generally are
facing fewer resources. Reductions in state environmental agency
budgets are fully consistent with the overall reductions in state
budgets recently seen in the United States.
The August 2010 ECOS report, noted previously,\28\ concluded that
state budgets decreased by an average of approximately $21 million per
state from 2009 to 2011. On June 28, 2011, the National Association of
Clean Air Agencies (NACAA) sent a letter to the U.S. House of
Representatives detailing the status of 40 state and local air quality
agencies.\29\ The NACAA letter indicates that 80 percent of air
agencies experienced a decline in staffing levels in the last 4 years.
Over the years 2008-2010, the average loss of staff per agency was 16.7
percent. In addition to staffing losses, 48 percent of air agencies
experienced furloughs, and the majority faced significant declines in
budgets. These cutbacks resulted in curtailing core air program
activities including permit issuance, and education and outreach
programs. In our recent consultations with states most confirmed that
they have seen their budgets and staffs reduced in recent years as the
states have responded to the economic downturn and budget shortfalls.
For the previously described reasons, states have not had the
opportunity to build capacity and resources to handle GHG permitting.
Accordingly, this criterion of state resources supports maintaining the
current thresholds.
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\28\ ``The Status of State Environmental Agency Budgets, 2009-
2011,'' p. 3.
\29\ S. William Becker to Honorable Michael Simpson, Chairman
Subcommittee on Interior, Environment, and Related Agencies, and
Honorable James Moran Ranking Member, Subcommittee on Interior,
Environment, and Related Agencies.
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C. What is the ability of permitting authorities to issue timely
permits?
The second criterion we address is whether permitting authorities
have the ability to issue timely permits based on efficiencies
resulting from GHG permitting implementation experience.\30\ In
describing this criterion in the Tailoring Rule, we expected that
permitting authorities, by acting on the anticipated volume of GHG PSD
permit actions, would have the opportunity to establish efficient
methods for resolving issues and processing permits, including
developing expertise within their staff. This would allow them to
achieve efficiencies that, in turn, would create capacity for
processing more GHG permit applications. Thus, with this criterion, we
based our commitment to complete the Step 3 rulemaking in part on the
assumption that Steps 1 and 2 would provide us with the necessary
information to determine whether and when it has become possible for
states to administer GHG permitting programs for additional sources.
This has not yet happened.
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\30\ As noted above, this criterion may be measured by the
period of time permitting authorities need to issue permits, and it
also encompasses the sources' ability to meet GHG permitting
requirements.
---------------------------------------------------------------------------
While we recognize that we have not yet completed a full year of
implementation for Steps 1 and 2, GHG permit applications are fewer
than we had expected. As of December 1, 2011, the EPA and state
permitting authorities have issued only 18 GHG PSD permits. As noted,
these 18 permit actions have been spread among 11 states and the EPA.
Almost all of the states have issued only one GHG permit, and only
Michigan has issued as many as three
[[Page 14237]]
permits. This activity has simply been too limited to allow States to
build internal capacity to handle GHG permitting for a diverse set of
sources, to develop more efficient techniques for permitting any
particular source category, or to develop streamlining approaches to
address GHG permitting. In our consultations with the states, some have
confirmed that they have not been able to build up their GHG permitting
infrastructure. However, they generally have added that they do not
believe that 2011 has been representative of the permitting burdens
that they expect will ultimately occur under the current Tailoring
Rule. In sum, the states' experiences to date do not provide a basis
for us to conclude that permitting authorities in fact have the ability
to issue timely permits based on GHG permitting experience thus far.
D. Has the EPA developed streamlining methods?
In the final Tailoring Rule, we indicated that implementation of
permit streamlining approaches would assist permitting authorities by
removing some sources from the permit program, or allowing more
efficient processing of applications. As we indicated in the final
Tailoring Rule, however, we expected it would take several years for
the EPA to develop and for States to gain authority to implement
effective streamlining methods. We did not anticipate that streamlining
approaches would be available by the time of the Step 3 rulemaking. We
also note that in the previously described consultations, the states
reported that they have made little progress in implementing
streamlining measures, and none have adopted measures specifically to
address GHGs. This information is consistent with EPA's estimate, in
general, that it would take at least 3 years for EPA to develop, and
for states to adopt and implement streamlining methods, so that
sufficient progress on streamlining would likely not occur before the
Step 3 rulemaking deadline.
We are proposing requirements for PALs and synthetic minor
limitations for sources, and these also constitute streamlining methods
that can be expected to free up administrative resources. However,
these methods will not be available in time to enhance the state's
ability to manage the GHG permitting programs during Step 3. The
benefits of a PAL will not be seen until the States adopt these
requirements into their SIPs and sources apply for and receive permits
that reflect PALs. For the previously-described reasons, although we
are making progress in developing streamlining measures, the current
status of streamlining measures supports maintaining the thresholds for
Step 3.
In addition, as noted, we are continuing to consider other
streamlining approaches, including limits on potential-to-emit, general
permits, and presumptive BACT. For the most part, these other
streamlining methods even if further developed, would have limited
benefit for improving permitting administration for the source
categories currently subject to GHG PSD permitting or that are under
consideration for Step 3. We discuss our progress in developing these
other streamlining methods, and their limited utility for Step 3, in
section VI. This rulemaking provides a good opportunity to provide the
EPA with input on additional streamlining ideas for implementation of
the GHG permitting programs. More specifically, in section VII.B we
request comment on other potential streamlining techniques that may
hold promise to reduce PSD and/or title V permitting burden for sources
of GHGs and permitting authorities.
E. Limited Benefit From Lowering Thresholds in Step 3
The fact that PSD would apply to the great bulk of GHG emissions at
the Tailoring Rule thresholds was a factor in our decision to establish
the thresholds at the 100,000/75,000 levels. For the current
rulemaking, we have conducted further analysis, which shows that
reducing the thresholds in Step 3 to as low as 60,000/60,000 would
bring within the potential ambit of the PSD program less than an
additional 1 percent of all GHG emissions from all stationary sources
above the statutory thresholds while potentially adding a significant
number of sources into the permitting programs. This is because of the
large amount of GHG emissions that come from very large sources,
coupled with the relatively small number of additional sources that
emit between the 100,000/75,000 and the 60,000/60,000 levels. Lowering
the thresholds to 50,000/50,000 would bring within the ambit an
additional 3 percent, above the 100,000/75,000 levels, of all GHG
emissions from all stationary sources above the statutory thresholds.
Please refer to the following Chart. Of course, in any year, only a
fraction of those emissions would actually become subject to PSD
controls, which would be the fraction emitted by sources that undertake
modifications or new construction. Thus, the additional reductions in
GHG emissions from lowering the thresholds in Step 3 would be small
under any circumstances even if the thresholds were lowered to 50,000/
50,000. This small amount of environmental benefit is an additional
factor that, along with the additional burden associated with
permitting these sources supports not lowering the thresholds in Step
3.
[[Page 14238]]
[GRAPHIC] [TIFF OMITTED] TP08MR12.025
F. Conclusion
In the Tailoring Rule, we recognized that the Step 1 and 2
thresholds we promulgated would create significant administrative
burdens on permitting authorities. We stated that we would lower the
thresholds, and thereby create additional administrative burdens, only
after: (i) We had the opportunity to develop efficiencies in GHG
permitting through streamlining measures; (ii) the states had the
opportunity to build up their GHG permitting infrastructure and to
develop GHG permitting expertise; and (iii) sources have the ability to
meet the requirements of the PSD program and permitting authorities
have the ability to issue timely permits. These things have not
happened, as the preceding discussion has made clear. As a result,
consistent with the commitment we made in the Tailoring Rule, lowering
the thresholds is not feasible at this time.
Importantly, because, as noted above, permit activity is linked to
macro-economic conditions, we consider the relative lull in permit
activity due largely to the recent economic downturn to be temporary,
and we expect that the pace of permit applications will increase. In
fact, because of the link to macro-economic conditions, it is difficult
to predict whether the increase in permit activity under Step 2 will
occur incrementally or rapidly. If it occurs rapidly, it would be
particularly burdensome for states. As a result, even a modest increase
in permitting burden that could result from lowering thresholds in Step
3 could overwhelm state permitting capacity and result in substantial
delays in processing permit applications.
All told, these considerations support maintaining the Tailoring
Rule thresholds through Step 3. Additional time is required to develop
streamlining measures to expedite permit program administration, and
permitting authorities need additional time to secure resources, hire
and train staff, and gain experience with GHG permitting before we move
toward full implementation of the program. Accordingly and consistent
with our Tailoring Rule commitment, we propose to maintain the
thresholds of 100,000/75,000 tpy CO2e.
We note that maintaining PSD and title V applicability for GHG
sources at the current thresholds for Step 3 does not have implications
for whether we will lower the thresholds in Step 4, which we describe
above, or afterwards. Our actions in Step 4 will depend on our
evaluation of the criteria and other factors described above. If those
criteria and other factors point in the direction of lowering the
thresholds, we will do so, and we will lower them to whatever level
indicated. A decision not to lower the thresholds in Step 3 does not
foreclose a decision to lower them in Step 4.
VI. Streamlining for PSD and Title V Permitting of GHGs
In the Tailoring Rule, the EPA committed to explore streamlining
measures as an integral part of the phase-in approach to permitting
requirements for GHG emissions under PSD and title V. Streamlining
techniques would allow permitting authorities to be more efficient in
administering their GHG permit programs by reducing the overall
resources required to administer the PSD permitting program now and in
the future. By implementing effective streamlining techniques
permitting authorities could move more rapidly toward regulating a
larger set of GHG sources. In the Tailoring Rule, we identified
potential streamlining options. We also acknowledged that it will take
us several years to develop, and for states to gain authority to
[[Page 14239]]
implement effective streamlining methods. We committed to continue to
explore the identified options, and to request comment on these and any
additional streamlining approaches in the Step 3 rulemaking.
Today, we propose to adopt two regulations: One that streamlines
the PSD permit program, and one that potentially streamlines both the
PSD and the title V permit program. As explained more fully below, the
first regulation expands the existing PAL provisions to allow reviewing
authorities to establish GHG PALs on either a mass-basis (tpy) or a
CO2e-basis, including for existing sources that are not yet
GHG major sources, and allows PALs to be used as an alternative
approach for determining both whether a project is a major modification
and whether GHG emissions are subject to regulation. As discussed
below, the second regulation establishes a mechanism that allows
individual sources to obtain synthetic minor limitations (potential to
emit (PTE) limitations) for GHG emissions in areas subject to a GHG PSD
FIP, which would allow certain sources or projects that might otherwise
be required to obtain a GHG PSD permit to obtain a permit with an
emissions limitation that would restrict the source's GHG emissions
below the GHG PSD permitting threshold.
We previously had not identified PALs as a viable streamlining
technique. Since we finalized the Tailoring Rule, we recognized that
the existing PAL regulation has limited value for GHG sources, and that
revising the current PAL regulations to address the unique
applicability aspects associated with GHGs could streamline PSD
permitting for more sources and make PALs for GHGs more useful for all
source categories. Specifically, by amending the regulations, we hope
to encourage greater use of GHG PALs, which in turn would encourage
sources to reduce existing GHG emissions through efficiency
improvements and other measures to maximize the operational flexibility
provided by the PAL.
In contrast, our proposed Tailoring Rule discussed the synthetic
minor--PTE mechanism we now propose, but expressed concerns that this
approach might overwhelm permitting authorities based on the sheer
number of sources that could apply for individual synthetic minor
permits. Since finalizing the Tailoring Rule, we have continued to
evaluate this. We have concluded that offering a mechanism to establish
PTE limits for individual sources provides environmental benefit, and
helps streamline the PSD and title V permit programs, at least in the
short term.
Accordingly, today we propose to amend the federal PSD regulations
to create authority for (i) reviewing and permitting authorities to
issue PALs to major and potentially-major GHG stationary sources on
either a mass-basis or a CO2e basis and also to allow such
PALs to be used as an alternative approach for determining whether a
project is a major modification and subject to regulation for GHGs by
amending regulations in 40 CFR 51.166 and 52.21, and (ii) federal
reviewing authorities to issue GHG synthetic minor permits by amending
regulations in 40 CFR 52.21. We also discuss our progress in evaluating
the suitability of other streamlining options that we identified in the
final Tailoring Rule including:
(1) Defining PTE for various source categories,
(2) Establishing emission limits for various source categories that
constitute presumptive BACT,
(3) Establishing procedures for use of general permits.
Although we propose two streamlining regulations on a more rapid
schedule than we originally envisioned, we do not project that these
approaches will provide a sufficient reduction in the immediate permit
workload to justify a decrease from the Step 1 and Step 2 applicability
levels. The PAL rule, in fact, may increase the immediate short term
workload by requiring development of PAL provisions and potential SIP
revisions, as well as gaining experience in issuing PALs, but will
reduce the long term workload on reviewing authorities and sources. The
GHG synthetic minor permit program will reduce the short term workload
by providing a less burdensome permitting process, and it may allow
some sources to avoid PSD and title V permitting at the current Step 1
and Step 2 applicability levels. We believe that these streamlining
regulations will offer advantages to industry, permitting authorities
and the environment. They will provide operational flexibility to
sources and will also provide incentives for sources to install good
emission control systems to maximize operational flexibility. These
streamlining regulations also help build GHG permitting capacity,
because both regulations still require the reviewing authority to gain
an understanding of GHG emissions for the individual source in context
of establishing appropriate emission limitations and monitoring,
recordkeeping and reporting requirements. Accordingly, we believe
implementation of both regulations should decrease overall
administrative burdens and thus could enable us to reduce the GHG
applicability thresholds at some time in the future.
The following discussion outlines our two streamlining proposals,
and then discusses the viability of other streamlining options.
A. Plantwide Applicability Limitations for GHGs
1. What is the EPA proposing?
Our proposal intends to provide permitting authorities with the
authority to issue GHG PALs to sources at which GHG emissions could
become subject to regulation, and which then must undertake a major
modification NSR applicability determination. We provide a summary of
several approaches for amending the regulatory language to implement a
GHG PALs program, and request comment on possible changes to the
regulations, any of which we may finalize.
We propose three changes to the existing PSD regulations in 40 CFR
51.166 and 52.21. These changes allow reviewing authorities to issue
PALs to both existing major and potentially major GHG stationary
sources on either a mass-basis or a CO2e basis and to allow
GHG PALs to be used as an alternative approach for determining whether
a project is a major modification and subject to regulation for GHGs.
The proposed changes would continue to protect the environment from
adverse impacts from projects that would increase emissions. The
changes would also streamline GHG preconstruction permitting as part of
our overall efforts to tailor the PSD applicability provisions to
include regulation of GHG emissions.
Specifically, we propose to amend the regulations to allow
reviewing authorities to (1) issue PALs to GHG-only sources \31\; (2)
issue either a mass-based (tpy) or a CO2e-based PAL to a
particular source; and (3) allow compliance with a GHG PAL to be used
as an alternative applicability approach for determining whether a
project is a major modification and subject to regulation \32\ for
GHGs. We believe these changes are appropriate to enable the use of
PALs for GHG, given the unique
[[Page 14240]]
characteristics of GHGs and the subject to regulation applicability
approach adopted for GHGs in the Tailoring Rule. We request comment on
each aspect of this proposal.
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\31\ A GHG-only source is a source that emits or has the
potential to emit 100/250 tpy GHG on a mass-basis, and emits or has
the potential to emit 100,000 tons per year of CO2e or
more, but does not emit or have the potential to emit any other
regulated NSR pollutant at or above the applicable major source
threshold.
\32\ For an explanation of ``subject to regulation,'' see the
background section in the Tailoring Rule at 75 FR 31516.
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2. What is a PAL?
Under the EPA's regulations, a PAL is an emissions limitation
expressed in tons per year for a pollutant that is enforceable as a
practical matter and is established source-wide in accordance with
specific criteria.\33\ PALs are voluntary in the sense that sources
may, but are not required, to apply for a PAL, and whether to issue a
PAL to particular source is at the discretion of the reviewing
authority. PALs offer an alternative method for determining major NSR
applicability. If the overall emissions at a source remain below the
PAL level, the source can make changes at the source that do not
trigger major NSR. This allows sources to respond rapidly to market
conditions, while assuring there is no adverse impact to the
environment from the change. A PAL also results in significant
environmental benefit, by providing the community with an understanding
of the long-term emissions impact from a facility, preventing emissions
creep (i.e., a series of unrelated individual emissions increases that
are below major NSR applicability thresholds), and requiring enhanced
monitoring, recordkeeping and reporting to demonstrate compliance with
the PAL.
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\33\ 40 CFR 52.21(aa)(2)(v).
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3. Why are we proposing to amend the regulations?
The EPA reads its current PAL and PSD regulations as restricting
permitting authorities from issuing certain kinds of GHG PALs. We
interpret our current regulations to restrict sources that can obtain
GHG PALs to existing major stationary sources, \34\ and to not allow
sources to rely on the PALs emissions limitation in determining whether
GHG emissions are ``subject to regulation.''
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\34\ 40 CFR 52.21(aa)(1).
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The PSD provisions generally define a ``major stationary source''
as a stationary source which emits or has the potential to emit 100 or
250 tpy or more of a regulated NSR pollutant, depending on the type of
source.\35\ A GHG-only source is a source that emits or has the
potential to emit 100/250 tpy GHG on a mass-basis, and emits or has the
potential to emit 100,000 tons per year of CO2e or more, but
does not emit or have the potential to emit any other regulated NSR
pollutant at or above the applicable major source threshold.\36\
Regardless of the amount of GHGs currently emitted, a GHG-only source
is a minor source for purposes of PSD, and only becomes major for PSD
when it proposes to undertake a change that increases GHG emissions by
at least 75,000 tpy CO2e. Currently, reviewing authorities
using the federal PAL provisions \37\ can only issue a PAL to a GHG-
only source when the source proposes to undertake such a change, thus
becoming a major stationary source.\38\ As a result, GHG-only sources
may not currently use the alternate major NSR applicability provisions
provided by a PAL in the same way that existing major stationary source
of other regulated NSR pollutants may. Instead, GHG-only sources must
wait to obtain a PAL until they actually propose to make a change that
qualifies the source as a major stationary source under the PSD
program.\39\
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\35\ 40 CFR 52.21(b)(1)(i)(a)-(b).
\36\ For the purpose of this rule, we term such sources ``GHG-
only sources.''
\37\ There can be alternative state PAL provisions or they may
simply adopt EPA's regulations.
\38\ 40 CFR 52.21(b)(49)(v)(b).
\39\ Because an anyway source emits or has the potential to emit
another regulated NSR pollutant in amounts at or above the major
source thresholds, it is a major stationary source, and it may apply
for a PAL for its GHG emissions on a mass basis at any time under
the current regulations as long as it otherwise qualifies (e.g., has
sufficient emissions data to establish a PAL).
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Moreover, under current regulations any EPA-issued PAL can only be
mass-based. This requirement is due to the fact that PALs are an
alternative for NSR, which is triggered by mass-based changes in
emissions. Consequently, GHG sources use tpy CO2e to
determine whether a change causes GHG emissions to be subject to
regulation, but tpy of mass emissions of the pollutant to determine
whether a change results in a major modification. Thus, under the
current regulations, sources using the PAL provisions must still
monitor both metrics to ultimately determine whether a change triggers
major NSR review.
We believe changing the regulations to remove these mass-based
restrictions will provide sources with additional operational
flexibility, and reduce GHG workload burdens on reviewing authorities
by decreasing the number of PSD permit applications reviewing
authorities must process for these sources over the long term.
Providing an option that allows a source to use a GHG PAL will help
streamline the major NSR permitting program and provide more
operational flexibility to sources. Being able to establish a PAL would
provide planning certainty to sources, and would relieve the current
time pressure to issue a PAL permit concurrent with authorization for a
planned major modification which could potentially delay that project.
We also believe that compliance with a GHG PAL generally assures that
the environment remains protected from adverse air impacts resulting
from changes a source undertakes in compliance with such a PAL,
regardless of which metric is specified to measure GHG emissions in
that PAL, because emissions cannot exceed this pre-established level
without further review. PALs also provide an incentive for a source to
minimize GHG emissions increases from future projects.
A significant rate is a threshold for applying NSR to
modifications. Only emissions rate increases above the significant rate
trigger major NSR requirements. Currently, a reviewing authority may
establish the PAL level for a pollutant by adding its significant rate
to baseline actual emissions. Unless a significant emissions rate has
been established, the significant rate is effectively zero, i.e., any
increase in emissions would trigger NSR.
The EPA did not promulgate a mass-based significant emissions rate
for GHG emissions in the final Tailoring Rule. Thus, if a reviewing
authority establishes a mass-based GHG PAL, under our current
interpretation of the regulations, the PAL may not include any margin
above the baseline actual emissions for emissions growth. Absent this
margin, a GHG PAL provides less flexibility to a source when compared
to PALs for other regulated NSR pollutants.
The proposed rules provides GHG PAL sources with the same kind of
flexibility sources currently have for other regulated NSR pollutants
by allowing sources to establish a CO2e-based PAL using the
75,000 tpy CO2e applicability threshold for GHGs. A
reviewing authority could add the 75,000 tpy CO2e to a
source's CO2e baseline actual emissions to establish the PAL
level, because the Tailoring Rule established 75,000 tpy
CO2e as the appropriate rate of emissions increase for the
GHG applicability threshold for existing sources. Changing the
regulations will also have the effect of streamlining future major NSR
applicability determinations for sources that choose a CO2e
PAL, by eliminating the need to evaluate GHG emissions on a mass basis
for major NSR applicability as long as the source is complying with the
CO2e PAL, because a CO2e PAL can function to
assure both that GHG emissions are not subject to regulation, and that
a change does not trigger a major modification.
[[Page 14241]]
In sum, we believe that the current PAL regulations are
inconsistent with the outcome achieved when the PAL rules are applied
to regulated NSR pollutants other than GHGs, and therefore are overly
restrictive with respect to GHG-only sources. Accordingly, we are
proposing to amend the major NSR regulations and PAL rules to allow
reviewing authorities to (1) issue PALs to GHG-only sources; \40\ (2)
issue either a mass-based (tpy) or a CO2e-based PAL to a
particular source; (3) allow CO2e-based PALs to include the
75,000 tpy CO2e rate of emissions increase applicability
threshold; and (4) allow compliance with a GHG PAL to be used as an
alternative applicability approach for determining both whether a
project is a major modification and whether GHG emissions are subject
to regulation. Provided a source complies with a GHG PAL, GHG emissions
at the source will not be ``subject to regulation,'' and a project at
the source will not result in a major modification. We request comment
on each one of these proposals.
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\40\ A GHG-only source is a source that emits or has the
potential to emit 100/250 tpy GHG on a mass-basis, and emits or has
the potential to emit 100,000 tons per year of CO2e or
more, but does not emit or have the potential to emit any other
regulated NSR pollutant at or above the applicable major source
threshold.
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In the Tailoring Rule the EPA amended the definition of ``subject
to regulation'' to establish a threshold level of GHG emissions that a
source must meet, on both a source and project basis, before GHGs to be
considered an NSR regulated pollutant for PSD permitting purposes.
However, the EPA also made clear that its action had the same
substantive effect, and should be treated as if the EPA had revised
other components of the definition of ``major stationary source'' to
achieve the same effect. Thus, in addressing PALs for GHGs in this rule
the EPA is continuing to focus on the thresholds incorporated into the
``subject to regulation'' provision, consistent with the approach in
the Tailoring Rule.
4. Options for Allowing GHG-Only Sources To Obtain a GHG PAL
We request comment on two approaches for regulating GHG-only
sources under a PAL. We call the first approach the Major Source Opt-in
Approach. This approach is consistent with the current restriction that
only allows reviewing authorities to issue PALs to existing major
stationary sources, but the approach would provide GHG-only sources the
ability to become existing major stationary sources, and thus receive
PALs for GHGs and any other pollutant emitted by the source. A GHG-only
source could become a major stationary source by agreeing to be
considered an existing major stationary source, without having a
specific qualifying project that increases CO2e emissions at
the source by at least 75,000 tpy CO2e.
We call the second approach the Minor Source Approach. In contrast
to the Major Source Opt-in approach, under the Minor Source Approach a
GHG-only source would remain a minor source. A reviewing authority
could issue GHG PALs to the GHG-only sources without requiring the
source to become an existing major stationary source, and thus could
not include PAL limits for non-GHG pollutants.
Under the Major Source Opt-in Approach, we would amend the
regulations to allow any existing stationary source that emits or has
the potential to emit GHGs in amounts above the first part of the
``subject to regulation'' applicability threshold (currently 100,000
tpy CO2e) and above the 100/250 tpy major stationary source
threshold, to submit an application for a PAL, in which the source
agrees to be considered an existing major stationary source for GHG
emissions. As long as the source complies with the GHG PAL, it would
not trigger the PSD permitting requirements for GHGs for any project,
but the regulations would continue to require the source to evaluate
whether the change triggers PSD applicability for other regulated NSR
pollutants in the attainment or unclassifiable area. This is because
PSD applies whenever a major stationary source undertakes a project
that results in a significant net emissions increase of any regulated
NSR pollutant.
The EPA believes that allowing GHG-only sources to opt into major
stationary source status is consistent with the Act. But for the
Tailoring Rule, GHG-only sources qualify as ``major emitting
facilities,'' because such sources emit or have the potential to emit
100 or 250 tpy GHG. Thus, these sources fall within the statutory scope
of sources that, absent the Tailoring Rule, we would have authority to
regulate for purposes of PSD. Although we took a limited interpretation
of how to exercise this authority through the Tailoring Rule, we
believe that the Major Source Opt-in Approach is consistent with the
Tailoring Rule's schedule for further phasing-in additional GHG sources
into the PSD permitting program.
In the final Tailoring Rule, we indicated that we would base our
decision to include additional sources in the GHG permitting programs
on an assessment of three criteria. These criteria are: (i) Whether the
EPA could develop streamlining measures, (ii) the time that permitting
authorities need to ramp up their resources, and (iii) sources'
abilities to meet the requirements of the PSD program and permitting
authorities' ability to issue timely permits. Each of these criteria
supports expanding the PSD permit program to include a source that opts
into the GHG PAL regulatory structure. First, while the Major Source
Opt-in Approach has the potential to increase the total number of GHG
major stationary sources, it does so in a manner that decreases the
long-term permitting burden for both the source and the reviewing
authority. This is because the source would likely require fewer permit
actions over the life of a PAL. Thus, the Major Source Opt-in approach
streamlines the PSD permitting program, which will assist permitting
authorities when the EPA regulates additional GHG sources under the PSD
program. Second, permitting authorities can gain valuable experience in
issuing PAL permits that can build staff expertise. This, in turn,
helps permitting authorities' efforts to ramp up their PSD permitting
programs in a more timely and efficient manner. Third, sources
demonstrate an ability to comply with major stationary source
permitting requirements by voluntarily seeking a PAL under the Major
Source Opt-in provisions. If a source could not comply, then it would
not seek a GHG PAL. Moreover, reviewing authorities likely would only
agree to issue a PAL if they believe they have the necessary resources
to issue the PAL(s), and doing so would not detrimentally affect their
obligations to otherwise issue timely permits. In sum, if a source
opts-into the program, and a reviewing authority agrees to permit the
source, then we believe these sources are properly brought within the
PSD permitting program.
Under the Major Source Opt-in Approach, a source could also choose
to establish PALs for its non-GHG regulated NSR pollutants to better
manage applicability for all pollutants at the source, including those
regulated NSR pollutants for which the source is not major. Under this
approach, the source will continue to be considered a major source
under PSD and title V at the expiration of the PAL (generally 10 years
after issuance). If the source is subject to the federal PSD program
for GHG emissions, and to a state SIP-approved PSD program for its non-
GHG regulated NSR pollutants, then whether a source can apply for, and
receive, a PAL for its non-GHG regulated NSR
[[Page 14242]]
pollutants will be governed by the applicable SIP-approved regulations
and the state reviewing authority. Neither the EPA, nor its delegated
authority, would issue PALs for non-GHG regulated NSR pollutants under
40 CFR 52.21, unless a FIP would govern PSD applicability for that non-
GHG pollutant. As with the current PAL regulations, the ultimate
decision to issue a PAL remains with the reviewing authority, and
individual permitting authorities will have to determine whether they
will issue PALs for non-GHG pollutants also emitted from a source that
receives a GHG PAL through the Major Source Opt-in Approach.
We are concerned, however, about the potential impact on reviewing
authorities of allowing GHG-only sources to obtain PALs for all their
regulated NSR pollutants, as this could cause a short-term increase in
regulatory burden on permitting authorities at a time when they are
ramping up their programs to address other GHG major stationary
sources. We request comment on this aspect of the Major Source Opt-in
Approach and welcome suggestions for refining the approach to address
concerns with short-term workload burdens for permitting authorities.
Under the Minor Source Approach, we would amend the regulations to
allow a GHG-only source to submit an application for a GHG PAL, and
would also allow the source to maintain its minor source status. A GHG-
only source that complies with its GHG PAL will not trigger PSD
permitting requirements for GHGs, but could trigger PSD for other
regulated NSR pollutant if it undertakes a change that increases
emissions by a ``major'' amount for any non-GHG regulated pollutant.
See 40 CFR 51.166(b)(1)(i)(c). That is, this approach would authorize
permitting authorities to use the PAL program for minor sources only to
regulate GHG emissions.
Moreover, under the Tailoring Rule existing minor sources that emit
only GHGs, but no other regulated pollutants in major amounts, must
determine whether any project will result in GHG emissions that are
subject to regulation (on a CO2e basis), and correspondingly
will also result in a major modification (on a mass basis). Because
GHG-only sources must undertake these determinations for any change,
even those that would not make the source major for GHGs, we believe
that extension of the PAL program to these sources through the Minor
Source Approach is consistent with the purposes and design of the PAL
program--to allow use of a PAL as an alternate major modification
applicability approach.
Issuing PALs to GHG-only sources that remain minor sources does not
conflict with the basis for the current PAL rules. When we promulgated
the PAL rules in 2002 (67 FR 80186), we limited the application of the
PAL provisions to existing major stationary sources only. We included
this provision based on our decision to limit PALs to sources that had
historical emissions through which the reviewing authority could
establish a baseline actual emissions level. New major stationary
sources do not have historical actual emissions from which a reviewing
authority can establish an actuals PAL, and so we declined to include
these sources in the actuals PAL program.
When we originally promulgated the PAL rules, we also chose not to
extend the PAL program to minor (source) NSR permit programs, because
PALs are an alternate major NSR applicability provision to determine
whether a project results in a major modification, and we did not
believe the program would be useful to minor sources. At that time, the
rules generally required only existing major stationary sources to
undertake a major modification applicability analysis to determine
whether a change triggers PSD review.\41\ Given the unique ``subject to
regulation'' PSD applicability requirement for GHGs, wherein an
existing source that emits major amounts of GHGs is a major stationary
source only at the time it proposes to undertake a project that will
result in an emissions increase of 75,000 tpy CO2e or more,
we do not believe that extending the PAL provisions to GHG-only sources
runs afoul of the reasoning we provided when initially limiting the PAL
program to existing major stationary sources.
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\41\ The provisions in 40 CFR 51.166(b)(3)(iii) illustrate an
exception to this general rule but we did not contemplate that
exception in creating the PAL rules in 2002.
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As explained previously, we propose to limit the Minor Source
approach to allow reviewing authorities to establish PALs only for GHG
emissions, and not for other regulated NSR pollutants for which the
source remains a minor source. Because the GHG-only source remains a
minor source (absent any other PSD-triggering change) and, generally,
will not trigger a major modification applicability analysis for
increases in other regulated NSR pollutants, we believe it unnecessary
to extend the PAL authority under this approach to other pollutants.
Moreover we recognize that extending the PAL program in that way could
place a burden on permitting authorities and redirect resources needed
to issue permits to other GHG major stationary sources.
The Minor Source Approach is consistent with the CAA in that it
regulates sources that but for the Tailoring Rule would be major
stationary sources based on the mass of their GHG emissions. This
approach is also consistent with our Tailoring Rule principles. But
unlike the Major Source Opt-in Approach, which defines the scope of
pollutants included in the PAL based on an individual permitting
authority's discretion and ability to regulate a given source, under
the Minor Source Approach, the EPA has determined that the scope of the
program is limited only to a source's GHG emissions and could not
include PAL limits for non-GHG pollutants emitted in amounts below the
major source levels. Again, as with the Major Source Opt-in Approach,
the Minor Source Approach fulfills our streamlining goals by bringing
more sources into the major NSR permitting provisions, in a manner that
best manages reviewing authorities' long-term permit burden.
We request comment on both the Major Source Opt-in Approach and the
Minor Source Approach. We also request comment on whether we should
finalize both approaches. That is, sources would have the ability,
consistent with the ultimate decision of its reviewing authority,
either to opt into major stationary source status and establish PALs
for all pollutants, or to maintain minor source status and obtain a PAL
for GHG emissions only.
5. Extending PALs to GHGs on a CO2e Basis and Using PALs To
Determine Whether GHG Emissions Are ``Subject to Regulation''
Currently, the EPA reads the PAL regulations to allow reviewing
authorities to establish a GHG PAL only on a mass basis. Today we
propose to allow reviewing authorities to establish GHG PALs on either
a mass basis or a CO2e basis. More specifically, we propose
to allow reviewing authorities to establish a CO2e-based GHG
PAL by adding up to an amount equal to the emissions increase contained
in the ``subject to regulation'' applicability threshold (e.g., 75,000
CO2e) to the source's baseline actual emissions. We also
propose to allow GHG PALs, either on a mass basis or a CO2e
basis, to serve as an alternate applicability approach for determining
whether GHG emissions are subject to regulation. That is, rather than
applying the emissions increase tests (significant emissions increase
and significant net emissions increase)
[[Page 14243]]
currently contained in the ``subject to regulation'' definition, a
source could demonstrate that GHG emissions are not ``subject to
regulation'' by complying with a GHG PAL. Compliance with a GHG PAL
would be used as an alternative applicability approach for determining
that the source neither causes GHG emissions to be subject to
regulation, nor causes the GHG source to have a major modification.
We further believe that it is necessary to allow the alternative
applicability provision to be included in ``subject to regulation''
determinations for GHG PALs, because failing to do so would negate the
flexibility gained by creating a GHG PAL. This is because without the
changes EPA is proposing, sources would still be required to monitor
individual emissions changes using the procedures in 40 CFR
52.21(a)(2)(iv) to determine whether a source triggers the subject to
regulation definition. The determination of whether GHGs are ``subject
to regulation'' uses procedures that rely on an emissions-unit-by-
emissions-unit analysis, and a shorter contemporaneous period to
measure emissions changes, neither of which are required under a PAL.
We believe that the enhanced recordkeeping, reporting and monitoring
burdens of a PAL, and the environmental benefits resulting from a PAL,
warrant extension of the alternate applicability provisions to subject
to regulation determinations to assure that the PAL provides the
intended flexibility to sources.
When we proposed the Tailoring Rule, we proposed to include
applicability thresholds within the definitions of major stationary
source and major modification, based on tpy emissions of
CO2e. We also proposed to establish a CO2e-based
significant emissions rate. In the final rule, we changed our
regulatory approach and instead included these applicability thresholds
within the ``subject to regulation'' definition, and we did not revise
the definition of significant to include a CO2e-based
emissions rate. We did so, in part, because we intended this change in
regulatory structure to facilitate more rapid adoption of the rules by
reviewing authorities. Nonetheless, we intended the definition of
``subject to regulation'' to function in tandem with the definitions of
``major stationary source'' and ``major modification'' to determine
whether a given project triggers PSD preconstruction permit
requirements. That is, if a source emits GHG emissions at a level that
causes the emissions to become ``subject to regulation,'' that same
level of emissions increase will likely cause the source to be a major
stationary source and trigger PSD requirements as a major modification.
Accordingly, since the 75,000 CO2e applicability threshold
contained in the second part of the ``subject to regulation''
definition works in tandem with the ``major modification'' provision to
determine whether major NSR applies we are proposing that a
CO2e-based GHG PAL can be established by adding up to an
amount equal to 75,000 CO2e to the source's baseline actual
emissions as this is the appropriate applicability threshold for
CO2e tpy GHG.
In our proposed Tailoring Rule, we noted that, in rare instances,
there may be an exception to this general principle, if a source emits
very small amounts of a particular non-CO2 GHG that carries
a very large GWP. 74 FR 55330. We noted our concern that the proposed
rule could cause sources, whose mass emissions do not meet the major
stationary source tpy threshold, to nonetheless be regulated under the
permit programs. When we finalized the Tailoring Rule using the subject
to regulation approach, we resolved this concern by retaining both a
mass-based threshold and a CO2e-based threshold. Our intent
in retaining both thresholds was to assure that no source was subject
to PSD that would not otherwise meet the statutory criteria for
treatment as a major stationary source.
This same regulatory structure creates the opposite effect for
sources operating under a GHG PAL. Instead of providing GHG PAL sources
with the ability to use either threshold to show that they are not a
major stationary sources and that major NSR does not apply, sources
must monitor both thresholds to prove this outcome under the current
rules. This is because a mass-based GHG PAL cannot assure that there is
no increase in CO2e tpy GHG. Expanding the GHG PAL program
to allow GHG PALs to be used as an alternative applicability provision
for both the major modification and ``subject to regulation''
determinations resolves this dual threshold issue. We also believe that
we may properly allow GHG PALs to be expressed on either a mass or
CO2e-basis, because, in essence, we intended the subject to
regulation determination to be functionally equivalent to making a
major modification applicability determination for GHG sources. We
resolve our previous concern that relying on a single metric might lead
to over-inclusion of sources that do not meet the statutory threshold
for the PSD program by limiting the GHG PALs program to GHG-only
sources, which are defined as those sources that, by definition, meet
the 100/250 tpy major stationary source threshold. We request comment
on all aspects of this proposal.
6. Can a GHG source that already has a mass-based GHG PAL obtain a
CO2e-based PAL once we issue final changes to the PAL rules?
We are proposing to add transition provisions to the PAL
regulations that would allow a GHG source that has a mass-based GHG PAL
to convert to a CO2e-based GHG PAL once, at the source's
option, and if agreed to by the reviewing authority. We intended these
provisions to provide integrity to the PAL provisions, and assure that
sources avoid casually opting out of the PAL program, rather than go
through the rigorous procedures for increasing the level of the PAL.
The current PAL regulations do not contain specific provisions for
dissolving an established PAL during the PAL term, but contain
provisions for when a PAL expires. It is inappropriate to apply these
rigorous procedures to sources that would have elected to seek a
CO2e-based PAL in lieu of a mass-based PAL, had such an
option been available. We propose to include regulatory language that
the expiration of PAL provisions do not apply when a source elects to
convert from a mass-based GHG PAL to a CO2e-based PAL.
Instead, a source could transition to a CO2e-based PAL and
the permitting authority could dissolve the mass-based PAL without
retaining the mass-based PAL level as a restriction on allowable
emissions.
We also propose to include provisions that allow the mass-based GHG
PAL to be converted to a CO2e-based GHG PAL in the middle of
the PAL effective period. Under the transition provision, the reviewing
authority would propose to dissolve the existing mass-based PAL permit
at the time it proposes the new CO2e-based PAL permit for
public comment. The reviewing authority would establish the new
CO2e-based GHG PAL following the standard procedures (10-
year lookback for baseline actual emissions, 10-year PAL effective
period, etc.) in the current PAL regulations. Once a final
CO2e-based PAL permit is issued, the permitting authority
may also finalize its proposed action to dissolve the mass-based PAL
permit and remove any applicable requirements from the title V permit
following the appropriate title V procedures. This would, in essence,
create a new PAL and establish a new 10 year term.
We also propose to allow a reviewing authority to use a slightly
different procedure for this conversion from the standard PAL
procedures. If the baseline
[[Page 14244]]
actual emissions period the reviewing authority used to establish the
mass-based GHG PAL is no longer within the 10 year lookback period
currently available to the source, then the transition provisions would
allow that source a one-time conversion of a mass-based GHG PAL to a
CO2e-based GHG PAL using the same baseline actual emissions
period used to establish the mass-based GHG PAL. The new PAL effective
period would be the remainder of the mass-based GHG PAL's effective
period. For example, if a reviewing authority issued a mass-based GHG
PAL to a source that became effective in 2011, that PAL's effective
period runs for 10 years through 2021. If the same source converts that
mass-based GHG PAL to a CO2e-based PAL in 2014, and elects
to use the expired, mass-based GHG PALs baseline actual emissions
years, then the CO2e-based GHG PAL would be effective for
the remaining 7 years of the mass-based GHG's PAL effective period.
We request comment on these procedures for converting a mass-based
GHG PAL to a CO2e-based GHG PAL. Specifically, we request
comment on whether there are existing mass-based GHG PALs for which
transition provisions are needed. More specifically, should we allow
such a transition, or should we decline to provide transition
provisions? If we decline to provide a transition should we instead
require sources either to maintain both PALs, or require the sources to
comply with a source wide emissions cap equal to the PAL level that
functions as a synthetic minor limitation? We also request comment on
whether we should provide a temporary transition provision to allow
sources to convert from the mass-based GHG PAL to the CO2e-
based GHG PAL only for a limited time after the effective date of the
regulatory changes, or whether the procedures should remain available
for the duration of the PAL provisions. Specifically, we request
comment on whether there are implications for major NSR compliance if
sources are allowed to switch from a mass-based PAL to CO2e-
based PAL at any time, or whether providing the option for the duration
of the program could encourage certain types of environmentally
preferable projects.
7. How would we change the regulatory provisions to implement PALs for
GHG-only major sources?
To implement our proposed changes, we would revise a number of
existing regulatory provisions, depending on the specific approach
selected. Under the Major Source Opt-in Approach, we propose to change
the definition of major stationary source at 40 CFR 52.21(b)(1) to add
a paragraph that defines Major Source Opt-in GHG-only sources as major
stationary sources. Under the Minor Source Approach, we propose to
revise the applicability paragraph for the PAL provisions at 40 CFR
52.21(aa)(1) to include GHG-only sources.
In addition, under the Major Source Opt-in Approach, we propose to
revise the PAL Permit Application Requirements provisions at 40 CFR
52.21(aa)(3) and (4) and Contents of the PAL Permit provisions at 40
CFR 52.21(aa)(7) to include provisions for opting into existing major
stationary source status.
Under either approach, we would: (1) Revise the PAL rules to add
transition provisions to 40 CFR 52.21(aa) for converting from a mass-
based PAL to a CO2e-based PAL including revisions to the PAL
expiration provisions; (2) add a paragraph to the ``subject to
regulation'' definition at 40 CFR 52.21(b)(49) and the PAL
applicability section at 40 CFR 52.21(aa)(1) to indicate that a source
that complies with a GHG PAL is not subject to regulation for GHG
emissions; (3) revise the PAL rules at 40 CFR 52.21(aa)(6) to allow
CO2e-based PALs to include the 75,000 tpy CO2e
rate of emissions increase applicability threshold by adding this
amount to a source's baseline actual emissions; and (4) revise the
definition of PAL and PAL pollutant at 40 CFR 52.21(aa)(2)(v) and (x)
to include CO2e as a metric of GHG emissions.
B. Synthetic Minor Source Permitting Authority for GHGs
1. What is the EPA proposing?
We are proposing to create synthetic minor permit authority,
within the existing federal PSD regulations in 40 CFR 52.21, for the
purpose of issuing ``subject to regulation'' synthetic minor permit
limitations on a CO2e basis for GHGs. We are also proposing
to amend the federal minor NSR program in Indian country for the
purpose of issuing synthetic minor permit limitations for GHGs. These
regulatory changes would allow certain sources or projects that might
otherwise be required to obtain a GHG PSD permit, pursuant to 40 CFR
52.21, to obtain a ``subject to regulation'' limitation that restricts
the source's GHG emissions below the ``subject to regulation''
threshold(s). That is, for sources located in a jurisdiction in which
the federal PSD permitting program applies, we propose a mechanism that
would allow the EPA, or its delegated agent, to issue a permit
containing synthetic minor limitations for GHGs to any source that
emits or has the potential to emit GHGs above the applicable subject to
regulation thresholds and that voluntarily requests a restriction on
its PTE. Although we would establish this program using our PSD
permitting authority, a synthetic minor permit limitation issued under
this authority could also effectively limit the source's GHG PTE for
purposes of title V applicability. As a general matter, we believe that
synthetic minor limits for GHGs should be available as an option for
sources that would prefer to take a legally and practicably enforceable
limitation on GHG emissions in order to avoid major source permitting
requirements. We believe that many state and local permitting
authorities will already have mechanisms in place to issue such GHG
synthetic minor limits to sources that request them, including title V
permitting programs, state minor source permitting programs, or
federally enforceable state operating permit programs. Nonetheless, we
request comment on whether permitting authorities implementing SIP-
approved PSD permitting programs lack mechanisms to create synthetic
minor limitations for GHGs, and if so, how that gap in permitting
authority or mechanism could best be filled.
It is important to note that we only propose to issue synthetic
minor permits for GHG emissions, not for other regulated NSR
pollutants, and we will only do so for sources located in areas where
the EPA is the GHG permitting authority (including areas subject to a
GHG FIP). These synthetic minor permits would also be available where
the federal PSD program is implemented by a state permitting authority
under a delegation agreement because delegated states issue PSD permits
on behalf of the EPA in those areas under 40 CFR 52.21. We, however,
are not proposing to issue synthetic minor source limits for non-GHG
pollutants under this rule. States and some tribes operate minor source
permitting programs that cover these other pollutants, and the EPA also
operates a minor source permitting program in Indian country. If a
source wishes to obtain a synthetic minor limit for any other
pollutant, it should seek that limit under the applicable minor source
program.
The EPA has long recognized synthetic minor permits as a way to
restrict a source's PTE and thus avoid major source NSR and title V
permitting
[[Page 14245]]
requirements.\42\ While we discussed the use of synthetic minor permits
for establishing PTE restrictions on GHG emissions in our proposed
Tailoring Rule, we expressed concerns that establishing GHG synthetic
minor limitations in individual permits could overwhelm reviewing and
permitting authorities based on the sheer number of sources that we
anticipated would apply for PSD permits. Thus, we proposed to focus our
attention on developing category specific approaches for limiting PTE.
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\42\ See, e.g., Guidance on Limiting Potential to Emit in New
Source Permitting (June 13, 1989); Guidance and Enforceability
Requirements for Limiting Potential to Emit through SIP and Sec.
112 Rules and General Permits (Jan. 25, 1995). The rules proposed
here for limiting potential to emit should be read in light of our
extensive prior guidance on this issue.
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Since finalizing the Tailoring Rule, we reconsidered this
conclusion, and now believe that establishing synthetic minor
limitations for individual sources could increase permitting
authorities' capacity to regulate GHG emissions by providing experience
in addressing emissions limitations, and monitoring, recordkeeping and
reporting requirements specific to GHG emissions. We also believe that
it would lead to an overall reduction of permitting burden in that
synthetic minor permits generally require fewer administrative
resources than full PSD permitting and title V permitting, to which
these sources could otherwise be subject.
Moreover, streamlining ideas often result from repeat experiences.
After issuing permits that share common features, a reviewing or
permitting authority might formulate new ideas for effective
streamlining techniques. We now believe that issuing synthetic minor
permits is a key component of our overall efforts to gain experience in
permitting GHG sources to phase additional sources into the GHG
program, because it can help manage sources currently subject to the
program and help identify opportunities for further streamlining the
GHG permitting programs. Moreover, allowing sources to obtain a
synthetic minor limitation, in lieu of triggering major NSR
requirements, encourages sources to effectively minimize project
emissions through efficiency improvements or other measures such that
the total GHG emissions to the environment from the project are lower
than might otherwise occur.
We acknowledge that other mechanisms may currently exist to
establish synthetic minor limitations for GHGs. We do not intend
today's proposal to supplant or supersede other available mechanisms
for creating synthetic minor limitations. Rather, our intent is to
ensure that we are able to issue GHG synthetic minor limits in the
areas subject to the federal PSD permitting program for GHGs to avoid a
potential gap in synthetic minor permitting authority and to ensure
that we are able to efficiently manage our administrative resources for
the federal PSD program. Notwithstanding today's proposal, we encourage
states to use appropriate existing mechanisms, or to create new
authority if needed, to issue synthetic minor limitations for GHGs.
2. What is synthetic minor limitation, and what is its function?
A synthetic minor limitation is a legally and practicably
enforceable restriction that a source voluntarily seeks to avoid major
stationary source requirements, such as the PSD or title V permitting
programs. Synthetic minor limitations allow sources to avoid these
permit programs in two ways. First, a reviewing or permitting authority
can issue a synthetic minor limitation to assure that a stationary
source does not emit above the major stationary source threshold, and
therefore, that the stationary source remains a minor source for either
one or both permit programs. Second, a reviewing or permitting
authority can issue a synthetic minor limitation to assure that
emissions increases from a project remain below the relevant
significant rate for a specific regulated NSR pollutant.
As we explained in the Background Section, our regulations define a
``major stationary source'' for purposes of PSD as a stationary source
that emits, or has a potential to emit, at least 100 tpy, if the source
is in one of 28 listed source categories, or, if the source is not,
then at least 250 tpy, of a regulated NSR pollutant. CAA section 169. A
``major stationary source'' for title V includes sources that emit or
have the potential to emit above 100 tpy or more of any air pollutant
subject to regulation. CAA sections 501, 302.\43\ We refer to these 100
or 250 tpy amounts as the major source applicability thresholds. These
thresholds are computed on a mass-basis for each regulated NSR
pollutant or title V air pollutant.
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\43\ As explained in the Tailoring Rule, while the statutory
provision addresses any air pollutant, we have historically applied
the PSD and title V programs only to pollutants subject to
regulation.
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Because the definition of major stationary source relies, in large
part on, a source's ``potential to emit,'' the definition of
``potential to emit'' is extremely important in determining the
applicability of PSD and title V for a particular source. The PSD
regulations define PTE as:
The maximum capacity of a stationary source to emit a pollutant
under its physical and operational design. Any physical or
operational limitation on the capacity of the source to emit a
pollutant, including air pollution control equipment and
restrictions on hours of operation or on the type or amount of fuel
combusted, stored or processed, shall be treated as part of its
design if the limitation or the effect it would have on emissions is
federally enforceable.\44\
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\44\ 40 CFR 52.21(b)(4). Following two court decisions, National
Mining Association v. EPA, 59 F.3d 1351 (DC Cir.1995) and Chemical
Manufacturers Ass'n v. EPA, No. 89-1514 (DC Cir.1995), we clarified
that the term ``federally enforceable'' should be read to mean
``federally enforceable or legally and practicably enforceable by a
state or local air pollution control agency.'' Release of Interim
Policy on Federal Enforceability of Limitations on Potential to
Emit, at 3 (Jan. 22, 1996).
40 CFR 52.21(b)(4), 51.165(a)(1)(iii), 51.166(b)(4). The title V
regulations are similar. 40 CFR 70.2.
If a source has no practicably enforceable emissions limitations
that restrict the amount of a pollutant the source may emit, and the
source has no restrictions on its capacity utilization or hours of
operation, we require the source to use its highest expected emissions
rate and ``assume operation at maximum design or achievable capacity
(whichever is higher) and continuous operation (8760 hours per year)''
to compute its potential to emit.\45\ Thus, if a source will actually
emit below its maximum capacity to emit, a synthetic minor limitation
can play an integral role in limiting the source's PTE to a level below
this maximum level. If the source accepts legally and practicably
enforceable limits and requirements sufficient to limit its PTE, that
source can be treated as a minor source, rather than a major source,
for purposes of our regulations.
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\45\ See Memo from Terrell E. Hunt, Associate Enforcement
Counsel Air Enforcement Division Office of Enforcement and
Compliance Monitoring, and John S. Seitz, Director Stationary Source
Compliance Division Office of Air Quality Planning and Standards,
June 13, 1989.
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Synthetic minor limitations are also important for determining
whether a project will result in an emissions increase that exceeds the
significant rate for a regulated NSR pollutant, thus triggering PSD
permitting requirements. While the significant rate for GHGs is
currently zero tpy, thus making this type of synthetic minor limit less
practical for GHG sources, the methods used to determine such emission
increases are applicable to GHGs because they are also used to
determine whether GHGs are ``subject to
[[Page 14246]]
regulation.'' To compute whether a project will result in a
``significant emissions increase'' under the federal PSD regulations, a
source has the option of using either ``projected actual emissions,''
or PTE to estimate post-change emissions. A source opting to use PTE
can reduce the amount of its PTE by accepting legally and practicably
enforceable limitations on its operations. To compute whether a project
will result in a ``significant net emissions increase,'' a source must
compute emissions increases from projects that occur during the
contemporaneous period. A creditable emissions increase is computed by
comparing ``baseline actual emissions'' to the unit's post-change PTE.
A permitting authority can use a synthetic minor limitation to limit an
emissions unit's post-change PTE to reduce the amount of emissions
increase that is creditable in a net emissions increase analysis. In
computing a creditable emissions decrease, a source may only take
credit for an emissions decrease that is legally and practicably
enforceable. Thus a reviewing authority can use a synthetic minor
limitation to create a creditable emissions reduction. 40 CFR
52.21(b)(3)(vi)(b).
We call any permit used to restrict a source's PTE below either the
major stationary source threshold or below the significant rate a
``synthetic minor permit.'' We call a source that accepts limitations
on its operations a ``synthetic minor source.'' This is in contrast to
a ``true'' or ``natural minor'' source, which is a source whose PTE
remains below the threshold without any additional restrictions on the
source. Again, because the major stationary source threshold and
significant rate are mass-based for all non-GHG regulated NSR
pollutants and title V air pollutants, synthetic minor limitations,
historically, have reduced a source's mass emissions.
3. What is a ``subject to regulation'' limitation?
A ``subject to regulation'' synthetic minor limitation is unique to
the GHG permitting programs. Instead of allowing a source to avoid the
PSD or title V permit programs by establishing PTE limitations that
reduce tpy mass emissions, a ``subject to regulation'' limitation
reduces CO2e-based GHG emissions. This unique type of limit
is specific to GHGs, because of the unique way in which the EPA
regulated GHG emissions through the Tailoring Rule.
As we explained in the Background Section, a source must meet two
applicability requirements to trigger PSD permitting requirements for
GHGs: (1) It must emit GHGs in amounts--calculated on a CO2e
basis--that make GHGs ``subject to regulation,'' \46\ and (2) it must
also emit GHGs in amounts--calculated on a mass basis--that qualify as
a major stationary source (e.g., 100 or 250 tpy) and, if relevant,
qualify as a major modification (e.g., net emissions increase of more
than 0 tpy). For title V, GHGs are ``subject to regulation'' at a
stationary source that emits or has the potential to emit 100,000 tpy
CO2e. A ``subject to regulation'' limitation prevents a
source from emitting GHGs in amounts that exceed the relevant ``subject
to regulation'' applicability threshold that we established in the
final Tailoring Rule. Accordingly, just like other synthetic minor
limitations, a source that complies with a ``subject to regulation''
limitation can avoid triggering PSD or title V GHG permitting
requirements.
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\46\ Previously in this preamble we refer to the two-step phase-
in thresholds 75 FR 31516.
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As noted previously, in the Tailoring Rule, although the EPA
amended the definition of ``subject to regulation'' to establish a
level of GHG emissions that a source must meet, on both a source and
project basis, before GHGs will be considered an NSR regulated
pollutant for PSD permitting purposes, the EPA also made clear that its
action had the same substantive effect, and should be treated, as
having revised other components of the definition of ``major stationary
source'' to achieve the same effect. Even so, because in the Tailoring
Rule it was the ``subject to regulation'' provision that the EPA chose
to incorporate the phase-in thresholds, in this proposal concerning
PALs, the EPA is continuing to focus on the ``subject to regulation''
provision as the codification of the Tailoring Rule requirements, to be
consistent with the approach in Tailoring Rule.
Like the major stationary source applicability threshold, the
``subject to regulation'' threshold relies on the concept of PTE. And
like the major modification significant rate, the subject to regulation
threshold also relies on PTE to compute changes in GHG emissions at the
source. Accordingly, the EPA proposes to create new regulatory language
to affirm the EPA's and other reviewing and permitting authorities'
ability to establish limitations on a source that prevent a source from
emitting GHG emissions above subject to regulation thresholds on a
source-wide basis or for individual modifications.
Because we are not proposing to amend the regulatory definition of
PTE, consistent with the EPA's current policy, we will recognize
legally and practicably enforceable restrictions for determining
whether a source's PTE is below the subject to regulation threshold and
for determining whether an individual modification is below the subject
to regulation threshold. As with limitations on ``potential to emit''
in traditional synthetic minor permits under our current policy, these
restrictions need not be federally enforceable as long as they are
enforceable by the permitting authority.\47\
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\47\ We may alter this policy in final response to address the
Courts' decisions in National Mining Association v. EPA, 59 F.3d
1351 (D.C. Cir.1995) and Chemical Manufacturers Ass'n v. EPA, No.
89-1514 (D.C. Cir.1995).
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4. Why does the EPA need authority to issue synthetic minor source
permits?
In general, the EPA does not have a federal permitting program for
minor sources. Although the EPA recently finalized a minor NSR
permitting program for Indian country, that program did not affect
permitting outside of Indian country or include regulation of GHG
emissions.\48\ The EPA is now the GHG permitting authority in areas
subject to a PSD FIP, including Indian country, but does not have a
generally applicable minor source permitting program that the EPA can
use to restrict GHG PTE for sources that might want to request
voluntary limitations to avoid PSD permitting for GHGs.\49\ In these
areas it is not clear whether sources will be able to obtain synthetic
minor limits for GHGs from states or local permitting authorities
through other permitting mechanisms, or through any other cognizable
mechanisms for establishing a synthetic minor limit. Without a federal
synthetic minor permitting program for GHGs, a source that would be
subject to PSD permitting requirements because of a project's potential
GHG emissions, but that would be willing to reduce emissions from the
source or project to avoid those requirements, might not
[[Page 14247]]
have a viable permit mechanism for committing to these emissions
reductions and making them enforceable. Thus, we are proposing to fill
this gap in federal regulatory authority, because we believe doing so
is important to our GHG phase-in efforts and permitting authorities'
ability to manage their GHG permit workload (including our ability to
efficiently issue GHG permits), and because we believe that synthetic
minor limitations for GHGs can result in increased environmental
benefit.
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\48\ See 76 FR 38748 (2011) (promulgating Tribal minor source
rule).
\49\ The EPA recently increased the number of areas in which it
is the PSD permitting authority. On December 30, 2010, the EPA
imposed a partial PSD FIP for GHGs in some jurisdictions in the
Action to Ensure Authority to Issue Permits Under the Prevention of
Significant Deterioration Program to Sources of Greenhouse Gas
Emissions: Federal Implementation Plan. Once that FIP became
effective, the EPA became the GHG PSD permitting authority for seven
states: Arizona: Both Pinal County and Rest of State (excluding
Maricopa County, Pima County, and Indian Country), Arkansas,
Florida, Idaho, Kansas, Oregon, and Wyoming. In addition, the EPA
has long been the PSD permitting authority in a few other states, in
Indian country, and in some areas of the Outer Continental Shelf.
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We believe that synthetic minor limits for GHGs provide a valuable
mechanism to help manage GHG permitting burden and potentially reduce
GHG emissions, and that such limits should generally be available as an
option for sources that would prefer to take a legally and practicably
enforceable limitation on GHG emissions in order to avoid major source
permitting requirements. Before the Tailoring Rule, state and local
reviewing authorities predominantly issued synthetic minor permits to
sources, even when the EPA was the permitting authority for the PSD
permits. State and local agencies used their SIP-approved minor NSR
permit authority, or in some instances their Part 70 permit authority
or their federally enforceable state operating permit program, to issue
permits to a source that requested synthetic minor permit restrictions.
Recently, the EPA assumed GHG PSD permitting authority for a number of
jurisdictions.\50\ In many of these jurisdictions, as well as
jurisdictions in which the EPA has long been the PSD permitting
authority, state, local and tribal agencies may lack mechanisms to
create restrictions on a source's potential to emit GHG emissions. This
could occur if their minor NSR program regulations do not include GHG
emissions or perhaps if it only includes GHG emissions on a mass basis,
and if they do not have any other legal mechanism under which they
could issue a synthetic minor limit for GHGs. As we noted in the
proposed Tailoring Rule, states may but are not required to regulate
GHG emissions through their minor NSR programs. Accordingly, if a gap
in minor NSR permitting authority exists it may continue to exist. On
the other hand, these states may have other viable mechanisms for
issuing synthetic minor limits for GHGs, which might alleviate the
potential synthetic minor permitting gap.
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\50\ See FN 33 above.
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To better understand the extent of state, local and tribal
authorities' synthetic minor GHG permitting authority, we request
comment on whether there is a minor source permitting gap in areas
subject to EPA permitting authority for PSD permits for GHG. For each
state in which the EPA is the GHG PSD permitting authority, we request
information on the states' current efforts to interpret or amend their
minor NSR permit authority to include GHG emissions, and on other
mechanisms that may be available to create synthetic minor limitations
on a source's GHG emissions. If there is a gap in either permitting
authority or available mechanisms for issuing synthetic minor permits
for GHGs, we request input on how that gap could best be filled. We are
also requesting comment on whether there are sufficient permitting
mechanisms and permitting authority to create GHG synthetic minor
limitations in areas subject to a SIP-approved PSD permit program for
GHGs. If a gap exists outside of federal GHG PSD permitting areas, we
request suggestions for ways to address that gap.
5. What are the benefits to a federal GHG synthetic minor permit
program?
A federal GHG synthetic minor permit program will increase EPA's
GHG permitting capacity and provide valuable knowledge and experience
that the EPA can use to develop effective streamlining methods that
assist in the EPA's phase-in of the GHG PSD and title V permit programs
to statutory levels. It will also assist the EPA in managing the GHG
permit workload for sources already potentially subject to permitting
at existing applicability thresholds, and may result in enhanced
environmental protection compared to permitting a source as a major
source through PSD and/or title V.
We believe that creating federal authority to issue synthetic minor
permits to restrict a source's GHG PTE will decrease the long term
permit burden on the EPA (and eventually reviewing and permitting
authorities if they assume the role for PSD and/or title V permit
issuance) by allowing sources to avoid PSD permitting when their actual
emissions will not exceed the major source applicability threshold and
the subject to regulation thresholds. In addition, such federal
authority could reduce state and federal title V permitting burdens,
because a PTE limit may be structured in such a way that it also allows
a source to avoid the need to undergo title V permitting. We believe
that the cost and level of burden for sources applying for a synthetic
minor permit, and for permitting authorities to issue the permit, are
generally far lower than issuing either a PSD permit or a title V
permit. We request information about permitting authorities' and
sources' experiences in this regard.
Moreover, the ability to apply for synthetic minor permits can
result in greater environmental benefits than those obtained through a
PSD permit, because it creates an incentive for sources to reduce
emissions to levels below the applicability thresholds. For example, to
accommodate a need for an increase in capacity, suppose a source has
the option of either modifying an old, inefficient existing emissions
unit to increase its capacity, or adding a new, high efficiency, lower
emitting emissions unit. Under the federal PSD regulations, the post-
change emissions for a new emissions unit are equal to that unit's PTE,
while the source may use the projected actual emissions to estimate
post-change emissions for the existing emissions unit. Suppose the
source only operates 16 hours a day. If the source modifies an existing
emissions unit, it may project its emissions using the anticipated 16
hours of operation. In contrast, unless the source can obtain a legally
and practicably enforceable restriction on its hours of operation, to
determine its PTE, it must calculate emissions for the new emissions
unit assuming a full day (24 hours) of operation. As a result, PSD may
be triggered for the addition of the new emissions unit, while PSD may
not be triggered for the modification of the existing unit. Depending
on the cost of emissions controls, and the delay in obtaining the
preconstruction permit, the source may choose to modify its existing
emissions unit, rather than install the environmentally preferable new
emissions unit if it cannot obtain a PTE limit. Providing the EPA the
ability to issue synthetic minor permits for GHG emissions gives the
EPA a tool to avoid this outcome.
Finally, because we believe that synthetic minor permits generally
require fewer administrative resources than full PSD permitting,
establishing this synthetic minor program allows permitting authorities
to focus greater resources on larger sources that, for whatever reason,
cannot or do not want to restrict the emissions to lower levels.
Accordingly, for all the reasons described here, as part of the
EPA's effort to phase-in the permitting requirements for GHGs, the EPA
proposes to add authority to issue synthetic minor permits to sources
for which the EPA, or its delegated agent, is the GHG PSD permitting
authority. We propose to add the authority to issue CO2e-
based synthetic minor permits to sources whose potential emissions are
above the statutory major source
[[Page 14248]]
threshold (i.e., 100 or 250 tpy GHG) on a mass basis or the subject to
regulation thresholds on a CO2e basis.
We request comment on our conclusion that a federal synthetic minor
permit program will assist in the EPA's efforts to phase-in the GHG
permit program and efficiently manage its GHG permitting resources. We
also request comment on our conclusion that synthetic minor permits can
achieve enhanced environmental protection.
We also note that a synthetic minor limit on GHG emissions could
further reduce administrative burdens under the title V permitting
program for two reasons. First, as long as the title V GHG
applicability threshold is equal to or higher than the PSD threshold,
any synthetic minor limit that establishes GHG emissions below the PSD
threshold would also prevent such sources from becoming title V sources
based on their PSD major source status and/or applicable PSD
requirements for GHGs. Second, if the synthetic minor permit restricts
GHGs below the subject to regulation threshold for title V, such
sources would not qualify as title V sources because of their GHG
emissions alone. Of course, if such a source qualifies as a title V
source based on their emissions of a non-GHG pollutant or based on
title V applicable requirements, that source would still be required to
comply with those title V obligations, regardless of the synthetic
minor limit for GHGs.
6. What is the legal rationale for EPA's GHG synthetic minor source
permitting authority?
Our authority to issue GHG synthetic minor permits arises from the
fact that, but for the Tailoring Rule, the sources eligible for this
type of permit would qualify as ``major emitting facilities'' under CAA
section 169 because they emit or have the potential to emit more than
100 or 250 tpy GHGs on a mass basis, depending on the source category.
As a result, we interpret CAA section 165 to convey to PSD permitting
authorities, including the EPA, the legal authority to issue
preconstruction permits to these sources. We note that we do not expect
that sources at or near the 100/250 tpy levels would seek such permits
at this time, since such sources are unlikely to trigger PSD under the
current applicability tests. Instead, we expect that larger sources
would avail themselves of this option.
Although CAA section 165 by its terms authorizes the EPA to issue
permits to major sources, and sources to whom we issue a GHG synthetic
minor source permit are, in many instances, not major sources, we
propose that under the present circumstances, CAA section 165
authorizes the EPA to issue these permits. As noted, these sources
would be major sources but for the Tailoring Rule, and as explained in
that rule, the administrative burden associated with immediately
implementing the PSD program at statutory levels for GHGs would have
crippled the program. Thus, we decided to tailor the program and phase-
in the permitting requirements to ensure that the PSD permitting
program would be administrable for GHGs. Similar to the approach in the
Tailoring Rule, we view the GHG synthetic minor program as another tool
to help ensure that the PSD program for GHGs can be administered in an
effective and efficient manner. Because the GHG synthetic minor program
will have those effects, CAA section 165 may be read to authorize it.
CAA section 301(a)(1), which authorizes the Administrator ``to
prescribe such regulations as are necessary to carry out his functions
under [the CAA],'' provides additional authority.
7. What changes would EPA make to the PSD regulations to allow EPA to
issue GHG synthetic minor permits?
We are proposing to change both the federal PSD permitting program
in 40 CFR 52.21 and the federal minor NSR program in Indian country in
40 CFR Part 49. For the federal PSD permitting program, we propose to
add a new Sec. 52.21(dd) to the existing PSD regulations. The proposed
regulatory provisions are similar to the requirements we established in
Indian country in 40 CFR Part 49, most particularly at 40 CFR 49.158.
The proposed provisions address permit application and permit content
requirements, as well as requirements for monitoring, recordkeeping and
reporting, and public participation. We request comment on any
additional provisions that may be needed to establish a GHG synthetic
minor permitting program in 40 CFR 52.21, and on any additional changes
to the proposed regulatory text that might be required. In addition, we
request comment on a number of specific provisions of the proposed
regulatory language relating to the definition and use of an emissions
limitation (using the phrase ``which has the effect of limiting''
instead of the terms limit(s) or limitation(s) in proposed provisions
52.21(dd)(2)(i), (5)(ii)(b), and (5)(v)(a)); two options for addressing
the determination of application completeness (see different deadlines
and processes for finding completeness in proposed provisions
52.21(dd)(4)(ii) and (iii)); and the appropriate procedures, if any, to
include for administrative review (see proposed provisions
52.21(dd)(4)(vii) and (7)(iv)). Finally, we would also amend the
existing regulations in Part 49 to ensure that we have synthetic minor
permitting authority for GHG sources located in Indian country.
Amending our existing minor source authority for Indian country to add
GHG synthetic minor authority would retain all synthetic minor
authorities for Indian country within one rule. We believe this would
be easier for sources in Indian country to implement, but we request
comment on whether we should instead limit the proposed changes to only
40 CFR 52.21.
C. Redefining Potential To Emit and Source Category Specific PTE
This section discusses our current thinking on developing category
specific PTE rules or guidance and requests comment on the appropriate
categories and requirements. In addition we are also exploring a novel
approach that would provide an individual source, in any of multiple
source categories, a way to obtain streamlined, as well as legally and
practicably enforceable restrictions, on the source's hours of
operation. We outline and request comment on a potential approach for
creating such a rule; however, we do not intend to finalize this
approach in this rulemaking.
As explained in the Tailoring Rule, because the PSD and title V
applicability are based on PTE, rather than on actual emissions, they
could sweep enormous numbers of sources into the PSD and title V
programs even though those sources' actual emissions are far below the
applicability thresholds. For example, sources that operate for only
part of the year, but that have no legally and practicably enforceable
limitation on their operating hours, must calculate their PTE on the
basis of the amount of emissions that would result if those sources did
operate, and therefore emit, on a year-round basis (8760 hours per
year). Our proposed synthetic minor rule would give sources the option
to accept legally and practicably enforceable limits on their
operations by, for example, agreeing to limit the hours the sources
operate and complying with recordkeeping, monitoring, and reporting
requirements to ensure that these limits are enforceable as a practical
matter. As we have explained, the issuance of synthetic minor permits
to individual sources benefits the GHG phase-in program, but we would
like to continue to explore methods that can reduce the number of
individual permits a reviewing or permitting
[[Page 14249]]
authority need to issue. Therefore, in addition to individual minor
source permitting, we continue to explore adopting, or encouraging
state permitting authorities to adopt, rules for source categories that
we expect include large numbers of sources whose actual GHG emissions
are well below applicability thresholds, but which, absent legally and
practicably enforceable limitations, have PTE above those thresholds.
As we noted in our proposed Tailoring Rule, the first step
necessary to develop a source specific PTE regulation or guidance is to
identify source categories that are generally conducive to a
streamlined PTE approach. 74 FR 55321. In selecting one or more source
categories, one consideration is how to address the possibility that
the GHG applicability thresholds could change in the future. Today, we
have more information on sources with a potential to emit 100,000 tpy
or more CO2e, and may be better situated to propose a source
category specific PTE rule for a one of these source categories, in the
nearer term. We have less information about smaller sources, and
developing a PTE rule will require significant additional information
collection, and technical analysis.
Source category PTE rules or guidance continue to offer the
opportunity for reducing administrative and permitting burden related
to sources of all sizes. We are broadly soliciting information on
source categories with sources at all levels of emissions, ranging from
sources with actual emissions below the PSD and title V statutory
thresholds to those that are just below the Steps 1 and 2 thresholds or
the thresholds under consideration for this rulemaking. Therefore, we
request comment on all source categories that would be candidates for
creation of a PTE-specific rule or guidance. Candidates include source
categories that currently have PTE substantially higher than their
actual emissions, so that, if we were to revise the thresholds to fall
below their PTE but remain above their actual emissions, a rule or
guidance that adjusted how sources in those source categories calculate
PTE could allow them to fall below the revised thresholds. For
instance, we request comment on the usefulness of a PTE regulation for
natural gas fired boilers that use a limited amount of fuel. As another
example, we solicit comment on whether this approach might be useful
for sources whose only emissions units are metered, natural-gas fired
units with actual GHG emissions below the relevant applicability
thresholds, which because of their metering are able to track and
determine their GHG emissions on a continuous basis. This option would
essentially allow sources to determine PTE with reference to their
actual emissions based on actual fuel use. Conceptually, this option
would likely be available for such metered sources that have
historically always had emissions below the applicability thresholds
and that will maintain and operate their meters on a going-forward
basis. For such sources, actual GHG emissions can be continuously
determined by monitoring their fuel use so that they remain below the
applicability thresholds, as well as comply with recordkeeping and
reporting requirements.
For any source category identified in comments, we specifically
solicit information on how the source category should be defined,
typical hours of operation over a year and whether those vary by, for
example, season, production cycle, or over a day, and information on
typical emissions. We specifically request input on what sorts of GHG-
emitting source categories may only operate seasonally or otherwise
have a limited production time--e.g., limited number of shifts, operate
only during day-time hours, operate only in the evenings, or emit
emissions only from heating during winter months--or have physical
restrictions on their operations that might make them well suited for a
PTE rule or guidance. We request comment on the time period that
reflects these sources' maximum historical operations, which we could
use to establish, whether through guidance or rulemaking, the PTE for
sources in those source categories. We also solicit comment on what
type of documentation would be necessary to demonstrate that sources in
a source category have a history of limited operations. For example,
would it suffice for sources to demonstrate a 5 or 10 year history of
limited actual hours of operation? Suppose a representative set of
sources in a source category has records documenting that they operated
only two, 8-hour shifts at their facilities for the past 10 years, and
that when workers are not working, emissions units are not running.
Alternatively, suppose a representative set of sources in a source
category has records that show that they only operate during summer
months, and that the longest they have operated in the summer is for 4
months. In such circumstances, could the EPA interpret, through
guidance or rulemaking, PTE for sources in that source category to
reflect that maximum level of actual operation?
We are also exploring the development of a streamlined method that
reduces the permitting burden for sources that have historically
operated with reduced hours of operations and are willing to accept an
hourly limit at or below the maximum level of historical operation. The
purpose of such a rule would be to create a legal mechanism by which
sources in at least certain types of source categories could take
legally and practicably enforceable limits on hours of operation
without having to go through the more burdensome process of obtaining
individual synthetic minor permits. Rather, we contemplate that under
such an approach, a source would report and document its historical
maximum hours of operation to EPA in some way, and accept a legally and
practicably enforceable limit to operate at or below that level, along
with obligations designed to ensure enforceability, such as
recordkeeping, reporting, and monitoring requirements.
In order to develop our thinking on this new approach, we are
asking for comment on several specific issues. We request comment on
whether such a rule would be helpful to permitting authorities in
reducing GHG permit burden. In addition, we request comment on whether
hours of operation is an operating parameter that does not need source
specific limitations to assure compliance. Have permitting authorities
included hours of operation restrictions in numerous synthetic minor
permits? What success or difficulties have permitting authorities
experienced in enforcing hours of operation restrictions through
synthetic minor permits? Have terms and conditions of such permits been
uniform within or between source categories?
Additionally, we are requesting input on whether such a rule should
target specific source categories, or be made broadly available to all
source categories, and on what types of GHG-emitting source categories
may only operate seasonally or have a limited production time. We
request comment on the appropriate structure and requirements for such
a rule. What sorts of application requirements, permit limits, and
recordkeeping, monitoring, and reporting have permitting authorities
required for such hourly limits? What time period adequately reflects
maximum historical operations, for purposes of determining a
restriction on future operations?
We also request comment on mechanisms the rule should provide to
ensure that the source does not exceed any limitation on hours of
operations
[[Page 14250]]
that it agrees to accept. Finally, we request comment on whether such a
process can be rigorous enough to maintain the necessary integrity in
PTE calculations, and made legally and practicably enforceable through
reporting, monitoring, and ongoing recordkeeping requirements, but
streamlined when compared to the burden of issuing and obtaining an
individual synthetic minor permit.
Again, we are just requesting comment in this action on the idea of
developing a rule to voluntarily restrict hours of operation across
multiple source categories and we are not proposing a specific rule at
this time. If, after reviewing comments, we determine that this is a
viable approach for streamlining GHG permitting, we may proceed to
propose a specific rule in the future.
D. General Permitting for GHGs
1. What is a general permit?
A general permit is a permit that the permitting authority adopts
once and then applies identically to each source that requests coverage
and meets the specific eligibility requirements. General permits are
best suited for the regulation of sources that perform the same or
similar operations, emit similar air pollutants and are subject to the
same limitations, standards and requirements. General permits are a
mechanism that provides for greater efficiency in issuing required
permits, thereby saving costs to both the source and the permitting
authority.
As noted in the following, some states have programs that authorize
general permits. These programs show very clearly that there are
benefits to using general permits. The issuance process for the permit
is relatively simple and streamlined. The applicable requirements for
these sources have already been identified for the applicant in both
the application and the permit. The applicant knows, prior to
application submittal, what conditions the permit will contain. In
addition, public review is simplified. The public review process for
general permits occurs before the general permit is finalized, rather
than on a permit by permit basis.
In the context of GHG, the issuance of PSD or title V general
permits would promote more efficient treatment of GHG-emitting sources
that would be subject to permitting, and allow the expeditious
expansion to more GHG-emitting sources while protecting those sources
and the permitting authorities from undue burden.
2. What is the Legal Authority for General Permits?
The CAA gives the EPA the authority in section 504(d) to issue
general permits for title V sources, and the EPA has regulations in
place to create general permits for title V sources. Although there is
no provision in the CAA that expressly authorizes the use of general
permits in the PSD program, the DC Circuit, in the Alabama Power case,
recognized that ``[c]onsiderations of administrative necessity may be a
basis for finding implied authority for an administrative approach not
explicitly provided in the statute'' and expressly identified general
permits as an alternative to the exemptions that were at issue in that
case. See 636 F.2d at 360. Further, courts have recognized the EPA's
authority to use general permits under section 402 of the Clean Water
Act without an express provision authorizing such general permits.
Environmental Defense Center v. EPA, 344 F.3d 832, 853 (9th Cir. 2003)
(``General permitting has long been recognized as a lawful means of
authorizing discharges.'') (citing NRDC. v. Costle., 568 F.2d 1369,
1381 (DC Cir. 1977)); NRDC. v. Train., 396 F. Supp. 1393, 1402 (D.D.C.
1975) (The EPA has ``substantial discretion to use administrative
devices, such as area permits, to make EPA's burden manageable.'').
3. Have the states used general permits?
Many states have taken advantage of the ability to use general
permits. In reviewing state programs, we have found that though the
concepts are similar, the structure and content of the various programs
is quite diverse. For example, the New Jersey Department of
Environmental Protection (NJDEP) has developed a general permit program
(GP-017) \51\ that allows for the construction, installation,
reconstruction, modification and operation of boilers and heaters less
than 5 MMBTU/hour. NJDEP defines a general permit as a pre-approved
permit and certificate which applies to a specific class of significant
sources. By issuing a general permit, NJDEP indicates that it approves
the activities authorized by the general permit, provided that the
owner or operator of the source registers with the Department and meets
the requirements of the general permit. If a source belongs to a class
of sources which qualify for a general permit and the owner or operator
of the source registers for the general permit, the registration
satisfies the requirements of NJAC 7:27-8.3 \52\ for a permit and
certificate.
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\51\ https://www.state.nj.us/dep/aqpp/downloads/gp17.pdf.
\52\ The permittee shall not construct, reconstruct, install, or
modify a significant source or control apparatus serving the
significant source without first obtaining a preconstruction permit
under N.J.A.C. 7:27-8. [N.J.A.C. 7:27-8.3(a)].
The permittee shall not operate (nor cause to be operated) a
significant source or control apparatus serving the significant
source without a valid operating certificate. [N.J.A.C. 7:27-
8.3(b)].
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Ohio's Division of Air Pollution Control (DAPC) also has developed
model general permits-to-intall and model general permits-to-install
and operate for select sources in Ohio. The regulations for general
permits can be found in OAC Rule 3745-31-29. Ohio states that a general
permit is the same as any permit-to-install or permits-to-install and
to operate that DAPC issues; the only difference is that all the terms
and conditions of the permit have been developed in advance. This is
referred to as the ``model general permit.'' Potential applicants can
review the model general permit qualifying criteria, terms and
conditions, and if they believe they qualify, they can complete the
application and sign the qualifying criteria document. The DAPC will
review the applicants' information to confirm that they meet the
qualifications, and then issue the general permit to the applicants.
4. What steps has the EPA made toward developing general permits?
In the context of streamlining the permitting process for GHGs, the
EPA is considering various methods for developing general permits. As a
procedural matter, the EPA is evaluating the possibility of proposing
an enabling rule to enable the development of PSD general permits for
GHG emitting sources. This rule would enable the EPA to create and
implement PSD general permits for GHG emissions only for selected
source or emissions unit categories. The enabling rule would lay out
the basic foundation for general permits. It would identify the general
provisions that would be found in all EPA-issued general permits, the
criteria and process for establishing a general permit, and discuss the
rationale and legal basis for a PSD general permit for GHGs. The
enabling rule would also establish the process for the creation of
general permits for the EPA's use where the EPA is the GHG permitting
authority and define mechanisms by which states could leverage federal
general permits to streamline the permitting processes for sources that
would trigger PSD for only their emissions of GHGs.
We are also considering the overall criteria for determining the
source or
[[Page 14251]]
emissions unit categories for which we may develop the first general
permits. Our initial inclination, on which we solicit comment, is that
we should focus first on GHG-only sources, that is, GHG-emitting
sources that do not emit non-GHGs in amounts that would be subject to
PSD requirements. This is because complying with PSD for non-GHG
pollutants involves analyses and demonstrations, such as a requirement
that the source demonstrate that the proposed project will not cause or
contribute to a violation of any NAAQS, which inherently are facility
and location specific. For GHGs, BACT is the primary substantive PSD
permitting requirement, and we believe that BACT can more readily be
established for a source or emissions unit category, thus making the
general permit approach feasible for sources and modifications that are
major only due to GHG emissions.
We are considering what source and/or emissions unit categories
would be good candidates for the first general permits. Even though
natural gas-fired boilers range from large high performance boilers for
industrial applications to small commercial and residential units for
space heating and hot water, sources for which the only or predominant
source of GHG emissions are boilers may be good candidates for PSD GHG
general permits. Because boilers are widely used throughout industrial
and commercial source categories, and can readily be categorized by
design, purpose, efficiency and emissions, they present opportunities
for significant streamlining through the use of general permits and
thereby reductions in administrative burden from PSD permitting.
Because the controls for GHGs on natural gas-fired boilers are
sufficiently uniform, it seems possible to identify standardized
control requirements to include in a general permit without
significantly compromising environmental protection.
Even so, it is unclear whether a general permit rule, for boilers
or other emissions units, would be a productive streamlining method for
the source categories and projects affected by this Step 3 rulemaking.
In many cases, boilers or other equipment located at a source or
involved in a project will emit non-GHG pollutants in amounts great
enough to trigger other significant CAA requirements such as minor NSR,
NESHAP and/or NSPS, diminishing the streamlining utility of a PSD
general permit for GHG only. We are also mindful that implementation of
a general permit program would likely involve regulatory action and a
SIP revision at the state or local permitting authority level, which in
and of itself imposes administrative costs, and the limited benefits of
a general permit program for the source categories and projects
potentially covered in this Step 3 rulemaking could be offset by the
administrative costs of the SIP revision process. Although we are
concerned that GHG general permits for boilers and other common
emissions unit categories may not provide enough streamlining value for
the source categories affected by this Step 3 rulemaking, we believe
such permits may have significant value when we consider smaller
sources, especially those with no other emissions units or non-GHG
pollutants emitted at significant levels. We are also considering how
to incorporate a general permit for GHGs into existing state permitting
programs. We are mindful that reviewing agencies generally have
construction permitting processes that address all applicable
requirements, including minor NSR and major NSR/PSD in an integrated
fashion. It would be important to structure the general permit program
so as to avoid complicating or conflicting with established permitting
processes.
We are also considering further questions, including: (1) Should
general permits be available to greenfield sources?; (2) When issuing a
general permit for a project/modification what do we do with pollutants
other than GHGs?; (3) Can general permits be utilized for projects at
any major source or only at sources major only for GHGs?; (4) Are
general permits available to both new and modified units?'' (5) ``Are
general permits mandatory or optional for states?; (6) What is the
process for establishing general permits?; (7) Should states or the
public be able to request that the EPA propose general permits for
source categories and emissions units, and if so, what is the process
for this type of request?; (8) What should the public participation
procedures be?; (9) What is the approval or denial process for sources
to use a general permit?; (10) What would BACT for a general permit
look like?; (11) How would BACT be established?; (12) How would BACT be
updated?; (13) What are the Endangered Species Act and environmental
justice implications of the general permit?; (14) Should there be a
periodic review of the general permit's provisions, and if so, what
would it look like?, and (15) Could we develop a process for states to
incorporate a general permit program into their SIPs in a way that
minimizes the administrative costs of the SIP revision process?
We commit to continue to explore the possibility of general permits
by reviewing information that we expect to receive in response to this
proposal and the information gathered by permitting authorities through
the implementation of GHG permitting. We believe that establishing
general permits will require collection of significant category-
specific data for various source and emission unit types as well as
those that have heretofore generally not been regulated by the CAA
(e.g., small furnaces, water heaters, etc.), which could take a
significant amount of resources and time.
We request comment on, in addition to the issues described
previously, possible sources and source categories that may benefit
from general permits, if such permits were only created for addressing
GHG emissions, as a streamlining method to assist in the phase-in of
GHG permitting. We request comment on the appropriate approach for
public review, in particular whether public review of individual uses
of a PSD general permit can be satisfied through public participation
in the development of the general permit itself or whether each
individual use of the PSD general permit requires public participation.
We also request comment on whether such a program should be a required
minimum element for SIP approved PSD programs, as relevant.
5. General Permits and Title V
We expect many of the issues related to PSD general permits would
also be relevant for title V general permits. For example, we would
expect title V general permits to be most useful for GHG sources that
trigger title V applicability due to boilers, but where sources are
subject to other requirements, such as NSR, NESHAP and/or NSPS, the
utility of general permits may be limited.
We request comment on experience with title V general permits
issued by state and local permitting authorities, including whether
permitting authorities have altered application requirements pursuant
to 40 CFR 70.6(d)(2), and other means of ensuring that general permits
met the goals of title V for streamlined procedures and assuring
compliance. Finally, we request comment on whether such a program
should be a required minimum element for state Part 70 title V
programs, as relevant.
[[Page 14252]]
E. Presumptive BACT for GHGs
1. Definition of BACT
The Act defines BACT as:
* * * an emission limitation based on the maximum degree of
reduction of each pollutant subject to regulation under this Act
emitted from or which results from any major emitting facility,
which the permitting authority, on a case-by-case basis, taking into
account energy, environmental, and economic impacts and other costs,
determines is achievable for such facility through application of
production processes and available methods, systems, and techniques,
including fuel cleaning, clean fuels, or treatment or innovative
fuel combustion techniques for control of each such pollutant. In no
event shall application of ``best available control technology''
result in emissions of any pollutant which will exceed the emissions
allowed by any applicable standard established pursuant to section
111 or 112 or this Act. Emissions from any source utilizing clean
fuels, or any other means, to comply with this paragraph shall not
be allowed to increase above levels that would have been required
under this paragraph as it existed prior to enactment of the Clean
Air Act Amendments of 1990.
CAA section 169(3).
Performing case-by-case BACT determinations can be complicated,
resource-intensive and time-consuming. In brief, the top-down BACT
process calls for all available control technologies for a given
pollutant to be identified and ranked in descending order of control
effectiveness. The highest-ranked (``top'') option(s) should be
established as BACT unless the permit applicant demonstrates to the
satisfaction of the permitting authority that technical considerations,
or energy, environmental, or economic impacts justify a conclusion that
the top-ranked technology is not ``achievable'' in that case. If the
most effective control strategy is eliminated in this fashion, then the
next most effective alternative should be evaluated, and so on, until
an option is selected as BACT. This analysis should be conducted for
each regulated NSR pollutant that is subject to the BACT requirement in
a given case. The EPA has broken down this analytical process into the
following five steps.
Step 1: Identify all available control technologies.
Step 2: Eliminate technically infeasible options.
Step 3: Rank remaining control technologies.
Step 4: Evaluate most effective controls and document results.
Step 5: Select BACT.
2. What is presumptive BACT?
Presumptive BACT is a potential streamlining approach that
involves the development of a standardized BACT for certain emissions
units. Presumptive BACT would create ways for specific categories of
permitted emissions units to move from a system under which
determinations are made on individual permits on a case-by-case basis,
to one where BACT is determined for common types of equipment, which
could be applied to individual permits with little to no additional
revision or analysis. In general, the EPA believes that presumptive
BACT could be implemented on a broad basis for specific emissions units
where there are well defined and similar types of emissions units,
uniformity in process/emissions unit design and function, and well
defined GHG control technologies. Reviewing agencies could adopt
presumptive BACT, possibly including model permit language and
monitoring, reporting and recordkeeping requirements, to streamline the
BACT analysis for GHGs within their own established permitting process.
The EPA has previously introduced the concept of presumptive BACT
to streamline permitting for desulfurization projects at refineries as
well as in other instances,\53\ and some state permitting authorities
have adopted similar approaches.\54\ Based on our understanding of the
types of sources that will become subject to PSD if GHG emissions are
regulated at levels below the thresholds currently contained in the
Tailoring Rule, we believe the presumptive BACT process could offer
significant streamlining benefits. Such streamlining benefits would
arise because many of the sources that would become subject to BACT at
lower GHG emission levels will likely have very similar emissions
producing equipment, and we believe there would be little variation
across sources with respect to the cost, energy and environmental
considerations in the BACT decision.
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\53\ See Memorandum, ``BACT and LAER for Emissions of Nitrogen
Oxides and Volatile Organic Compounds at Tier 2/Gasoline Sulfur
Refinery Projects,'' from John S. Seitz, Director, Office of Air
Quality Planning and Standards, to Regional Air Division Directors
(January 19, 2001).
\54\ For example, Wyoming has a minor source permitting program
that includes a BACT analysis, and they use a presumptive BACT
process for issuing minor source permits to a particular source
category--oil and gas production facilities. See Permitting Guidance
for Oil and Gas Production Facilities, Wyoming Dept. of
Environmental Quality, Air Quality Division (August 2007 revision).
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As discussed in the following, the EPA has expressed interest in
soliciting comments on the potential use of presumptive BACT for GHG
permitting. It should be understood that presumptive BACT would be only
an optional means to streamline the top-down BACT process by pre-
evaluating what could constitute BACT for specific categories of
similarly-situated emissions units. It should also be understood that
this would only be available to address the GHG emissions from those
units, and that the pre-construction permitting process would not be
affected in any other way.
Presumptive BACT would add another option for sources to achieve
BACT requirements and provides additional benefits for the source and
the permitting authority through streamlining of the permit process. In
actual implementation, the choice of a presumptive BACT option would
reduce burdens currently associated with conducting individualized,
top-down BACT analyses for each source requiring a PSD permit.
Nonetheless, there are several considerations to explore before we can
implement a presumptive BACT approach including the role of presumptive
BACT in a case-by-case decision framework, the role and timing of
public review, and preserving BACT's technology-forcing role within a
presumptive BACT framework.
3. How the EPA Could Consider Implementing Presumptive BACT
As noted previously, the CAA requirement for BACT, found in
section 165(a)(4), mandates that BACT determinations be made for each
regulated pollutant on a ``case-by-case basis.'' Accordingly, the EPA
would like to develop a process that benefits from the efficiencies
that presumptive BACT would provide while allowing for issuance of
individual PSD permits. In the proposed Tailoring Rule, the EPA
discussed potential options to explore presumptive BACT as an
alternative to the current case-by-case nature of conventional BACT. In
that discussion and in subsequent consideration by the agency, two
potential ways in which to implement a presumptive BACT program have
emerged: As an alternative method of completing a BACT analysis in an
individual permitting action or as a way to eliminate the need for an
individualized BACT analysis for all permits in a particular category.
The first approach would develop, through notice-and-comment
rulemaking or through permitting guidance, a presumptive BACT level for
sources in a particular source category that subsequently could be
applied and assessed in individual permitting actions. Under such an
approach, while the top-down analysis for an individual
[[Page 14253]]
permit would be fulfilled by a request to include the presumptive BACT
limit, there would still be an opportunity for permitting authorities
and the public to examine individual permits to assess whether there
are significant case-specific energy, economic, and/or environmental
impacts that would require adjustment of the presumed limit for that
particular source. This form of presumptive BACT would create a
rebuttable presumption that the emissions covered by the particular
source's BACT limit will, in fact, be controlled to the maximum degree
that can be achieved. This presumption shifts the burden to the
permitting authority or other interested parties to produce credible
evidence that the application of presumptive BACT to that particular
source would not comply with BACT requirements. If credible evidence
were produced, then the source would either be required to produce
evidence sufficient to show that the presumption is the best achievable
control technology or to conduct an individualized top-down BACT
analysis. Whatever mechanism the EPA may ultimately choose to implement
presumptive BACT, if any, the critical and essential component of a
successful BACT analysis will continue to be a strong record supporting
the decisions reached by the permitting authority, as explained in the
PSD and Title V Permitting Guidance for Greenhouse Gases (March 2011).
While such an approach could streamline the BACT determination
process to some extent, we are concerned that those streamlining
benefits could be negated given the prospect that such presumptive BACT
determinations would, as a result of permitting authority review and
public comment, still have to be reviewed for numerous individual
sources. Accordingly, the EPA has also considered a system in which
presumptive BACT levels for a specific category of emissions units
would be developed through notice-and-comment rulemaking but then
applied to individual sources in that category without requiring
permitting authorities to individualize the BACT determination or
allowing for public comment on whether presumptive BACT levels should
apply to an individual source. While, as noted in the following, some
have argued that such an approach would not strictly adhere to the
individual case-by-case BACT determinations envisioned in the CAA, even
if that is the case, maintaining case-specific BACT determinations may
well be impractical given the significant increase in new sources that
would likely be brought into the PSD program when GHG permitting
thresholds are reduced. Moreover, the DC Circuit, in the Alabama Power
case previously discussed, stated that courts ``frequently uphold
streamlined agency [regulatory] approaches or procedures where the
conventional course, typically case-by-case determinations, would, as a
practical matter, prevent the agency from carrying out the mission
assigned to it by Congress.'' 636 F.2d at 358. The Court recognized
that such non-individualized streamlining measures may be needed when
time or personnel constraints or other practical considerations ``would
make it impossible for the agency to carry out its mandate.'' See id.
at 359. A presumptive BACT approach that does not require
individualized, source-specific determinations could well be an
important tool to allow the EPA, state and local permitting authorities
to carry out the PSD program in as timely and efficient manner as
necessary to promote (rather than hinder) control of GHG emissions from
the many new, small source categories that would be required to have
PSD permits based on their GHG emissions. This approach would preserve
opportunities for public participation by taking comment during the
determination of presumptive BACT levels for a source category.
Although here too, some have argued that this type of presumptive BACT
approach, one that does not require individualized, source-specific
determinations, would depart from a literal application of the
statutory requirements for BACT, even if that is the case, it may
nevertheless remain closer to the congressional intent for the PSD
program in so far as it would reduce administrative burdens in each
permitting action, thus allowing more overall sources to become subject
to a PSD permitting program that moves applicability thresholds closer
to the statutory levels.
We received many comments on presumptive BACT during the public
comment period for the Tailoring Rule. Many commenters supported the
concept of presumptive BACT as a means to streamline PSD permitting.
Some noted that it would promote consistency in BACT determinations as
various permitting authorities gain experience with GHG permitting.
Some suggested that it would be useful for common combustion sources,
and at least one indicated that it would be particularly justified for
natural gas-fired equipment. Several included recommendations for
specific industrial sectors. A number of the supportive commenters also
recommended that the source have the option to use presumptive BACT or
to conduct a case-by-case BACT determination.
Some commenters opposed presumptive BACT. A few indicated that it
would not be flexible enough to take into account source-specific
factors. Others asserted that it is contrary to the requirements of the
Act for a case-by-case BACT determination and opportunity for public
review. Some noted that it would dampen the technology-forcing role of
BACT, and at least one suggested a periodic update not less than every
5 years.
The EPA requests comment on the possible approaches to presumptive
BACT discussed previously. We request comment on whether the first
approach, where each use of presumptive BACT would be subject to
permitting authority review and public comment, would offer significant
streamlining value. We also request comment on our legal authority to
implement each approach, particularly on the applicability of Alabama
Power principles to the second approach, which does not authorize
individualized, source-specific determinations.
4. Possible Impediments to Presumptive BACT
a. Public Comment Processes for Presumptive BACT
The provision of effective and meaningful opportunities for public
comment on BACT determinations is an important element of air
permitting process provided for in the CAA. In the context of the two
presumptive BACT approaches explained previously, the EPA or a state
agency could provide opportunity for public participation either in
individual permitting actions to allow the public to rebut the
presumption that a pre-determined BACT limit applies to the specific
source under consideration, or in determining the presumptive BACT
levels for a source category. The EPA requests comment on the public
participation approaches that would be appropriate to support
presumptive BACT determinations. For example, is it sufficient to
provide for public review and comment only during the rulemaking to
establish a presumptive BACT level or does the case-by-case nature of
BACT require comment for individual permitting actions? Even if we
follow the approach of establishing a presumptive BACT limit through
notice-and-comment rulemaking and limiting public input on individual
[[Page 14254]]
permitting actions, are there circumstances in which public comment
might also be warranted for those individual permitting actions the
presumptive BACT limit? If so, what are they? If we follow the approach
of allowing public input on individual permitting actions that use
presumptive BACT, are there ways in which the public comment might be
limited to recognize more streamlining benefits?
b. General Permits
The EPA is particularly interested to consider pursuing
presumptive BACT as a streamlining approach in cases where there would
be similar BACT outcomes in multiple permits due to similar source
characteristics and available control options. General permits, which
are discussed in the previous section, provide one context to implement
this. General permits are particularly useful in situations where
source operations are highly consistent and relatively simple across a
source category. General permits typically work best where sources in
the category are subject to the same applicable air regulatory
requirements, including those associated with criteria pollutant and
air toxics regulatory programs.
We are particularly interested to consider opportunities to
develop presumptive BACT options to complement potential general
permitting approaches addressing GHGs. In the absence of a presumptive
BACT approach, general permits addressing GHGs may have limited
streamlining value in light of case-by-case conventional BACT
determination needs. Accordingly, we request comment on opportunities
for using presumptive BACT approaches in the context of general
permits. In addition, we request comment on potential source categories
or types of emission units that may be particularly well-suited for a
general permit and presumptive BACT approach due to similarities in
source characteristics and available GHG control options. We also
request comment on whether presumptive BACT approaches for GHGs should
be considered for source categories and types of emission units that
may not be feasible to address using a general permit approach.
c. Updating of Presumptive BACT
In general, case-by-case BACT determinations allow for the
continual evolution of BACT requirements over time and are generally
referred to as ``technology forcing,'' in so much as available controls
identified in prior permits are considered in each subsequent BACT
determination and the specific facts of subsequent actions may support
application of a top-ranked control technology that was eliminated in
prior actions. However, the EPA recognizes that application of
presumptive BACT to a category of sources over many permitting
decisions may diminish the technology forcing effects of PSD. Updating
of BACT is an important concept to consider in the context of
developing a presumptive BACT option, and the EPA is interested in
options that would help maintain advances in control technologies.
As previously explained, the conventional top-down BACT process
incorporates continual updating of the BACT for each type of emission
unit through the analysis that occurs to ensure that the most current
BACT is used. To provide streamlining opportunities, the presumptive
BACT process would likely need to incorporate some form of updating
mechanism to ensure that the BACT remains current over time. We have
identified several different approaches by which such updating could be
accomplished. One approach would be for the EPA or a state agency to
periodically review and consider updates to the presumptive BACT option
established for a certain source category or type of emission unit. For
example, there could be a requirement to update presumptive BACT on a
set time interval (such as every 3 or 5 years).
Another approach could be to link a presumptive BACT determination
to a standard established through some respected standard-setting
programs so that the presumptive BACT level would automatically update
periodically in conjunction with updating process already used in
established standard-setting programs, as discussed in the following
examples. One option would be for the EPA or a state agency to set
presumptive BACT at the same levels used in equipment energy efficiency
standards established by government agencies or other respected
standard-setting bodies. For example, the U.S. Department of Energy
(DOE), pursuant to the Energy Policy and Conservation Act, promulgates
energy efficiency standards for industrial and commercial boilers.\55\
These periodically-updated equipment energy efficiency standards could
be used as the basis for presumptive BACT in cases where such standards
exist. Similarly, it may be appropriate to use ENERGY STAR equipment
certification as a basis for presumptive BACT. Whereas appliance and
equipment energy efficiency standards usually provide the ``ground
floor'' requirements for performance of new energy consuming equipment,
ENERGY STAR certification specifications establish minimum performance
requirements for high-efficiency, lower emissions equipment within
selected product categories. The ENERGY STAR program, administered by
the EPA in partnership with the DOE, establishes voluntary product and
equipment energy efficiency specifications for certain products and
equipment in an effort to transform the market for manufactured goods
by expanding the availability and visibility of energy-efficient
products. Commercial and residential products can earn the ENERGY STAR
label by meeting the energy efficiency requirements set forth in ENERGY
STAR product specifications.
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\55\ https://www1.eere.energy.gov/buildings/appliance_standards/residential/furnaces_boilers.html.
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Accordingly, ENERGY STAR equipment specifications include energy
efficiency performance requirements that exceed DOE appliance and
equipment standards. For example, to qualify for ENERGY STAR
certification, residential boilers must have annual fuel utilization
efficiency (AFUE) ratings of 85 percent or greater.\56\ This compares
with DOE boiler energy efficiency standards established in 2007 that
range from 80 to 83 percent.\57\
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\56\ https://www.energystar.gov/index.cfm?fuseaction=find_a_product.showProductGroup&pgw_code=BO.
\57\ https://www1.eere.energy.gov/buildings/appliance_standards/residential/pdfs/furnaces_boilers/furnaces_fr_111907.pdf.
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The EPA requests comment on approaches for ensuring that
presumptive BACT options are periodically reviewed and refreshed. We
also request comments on the feasibility and potential configuration of
approaches that connect presumptive BACT to equipment energy efficiency
standards or certifications or other external factors. In particular,
it would be helpful to receive comments on the role DOE industrial
equipment and appliance energy efficiency standards and/or ENERGY STAR
certification for industrial and commercial equipment play in the
context of presumptive BACT. In addition to the specific comments
requested previously, the EPA seeks overall comments on the use of
presumptive BACT, including suggestions for how such limits could be
established, updated and used consistently within the requirements of
the CAA, including requirements for a top-down, case-by-case BACT
determination process. The EPA invites comments on whether presumptive
[[Page 14255]]
BACT options should be advanced through rulemaking or through guidance.
Comments would also be useful regarding considerations that should
affect whether presumptive BACT approaches could be used to address
only existing units or new units. The EPA also encourages comments on
the respective roles of state, local and tribal air agencies relative
to that of the EPA in establishing presumptive BACT options.
F. Title V Empty Permits
In the Tailoring Rule, we identified a possible exclusion for
``empty permits'' (which are, as noted, permits issued to a source that
is not subject to any applicable requirement for any pollutant) as a
potential means for alleviating the potential burden of title V
permitting for GHG sources. In the Tailoring Rule we described an
``empty permit'' as ``a permit issued to a source that is not subject
to any applicable requirement for any pollutant.'' \58\ Empty permits
may occur because the applicability for title V is in part based on
major source status, yet there may not be any applicable requirements
that apply. Since the principal purpose of title V is to collect the
requirements applicable to the source and assure compliance with those
requirements it is unclear whether Congress intended sources,
particularly smaller sources, to be subject to title V permitting if
there are no applicable requirements for the source. The EPA solicits
comments on whether we may, and should, interpret title V as not
requiring permits for sources that are not subject to any applicable
requirements (as defined in 40 CFR 70.2). The EPA also solicits
comments on whether the EPA could adopt such an interpretation through
guidance, an interpretative rule (without notice and comment), or only
through notice and comment rulemaking, and whether states would, or
should, be required to submit program revisions to the EPA for approval
in order to exclude such sources from title V permitting.
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\58\ Empty permits are different from ``hollow permits.'' A
``hollow permit'' is a permit for a GHG major source that does not
contain requirements for GHG emissions, but which contains other
applicable requirements for pollutants for which the source is not
major.
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In the Tailoring Rule, the EPA noted that we anticipated very few
if any ``empty permits'' as a result of Step 2. However, there remains
significant uncertainty as to the number of ``empty permits'' that
would exist if the Tailoring Rule thresholds were significantly
lowered. The EPA believes that several SIPs contain generally
applicable requirements for sources that would constitute ``applicable
requirements'' for many sources that would become subject to title V
solely as a result of GHG emissions if the thresholds were
significantly lowered. We noted in the final Tailoring Rule that:
We need to gather more information concerning the potential
number and utility of ``empty permits'' for GHG sources, in light of
the fact that the need for requirements in title V permits will vary
based on the requirements of each SIP, and the fact that some SIPs
contain broadly applicable requirements.
Tailoring Rule, 75 FR 31566. Thus, we solicit comments, particularly
from states on these issues. For example:
What, if any, SIP requirements would be applicable to sources that
would become subject to title V permitting solely as a result of
emitting GHG in excess of a lower threshold?
What number (or proportion) of sources potentially subject to
title V would be expected to have no applicable requirements under the
SIP or other CAA programs?
Is there a threshold below which the number of empty permits would
increase significantly, as a result of a corresponding threshold in
applicability of SIP requirements?
VII. Request for Comment
We have requested comment throughout this preamble on many aspects
of the GHG permitting program and our proposed rulemaking. In this
section, we provide a summary of the issues on which we are requesting
comment and refer the reader to the preceding sections for our requests
on more specific points.
A. Solicitation of Comment on Proposed Step 3
1. General
We solicit comment on all issues described previously in section V
of this preamble. In particular we solicit comment from the states as
to their current and expected air permit budgets as well as their
current and expected future levels of permitting.
In addition, we solicit comment on promulgating lower GHGs
thresholds for PSD applicability and on promulgating lower GHGs
thresholds at any levels we have analyzed in this rulemaking for PSD
and title V applicability. Commenters advocating lower thresholds
should support their position with data demonstrating that the
permitting authorities have developed the capacity to handle the
current and future permitting volume under the existing thresholds, and
will be able to handle the additional permitting volume, in a timely
manner, that would be required at reduced thresholds. Commenters should
also be able to support their positions with data demonstrating that
sources have the ability to meet the requirements of the PSD program.
We note that in this rulemaking, we are not re-opening or
soliciting comment on the Tailoring Rule's decision to phase in the
thresholds, to begin with the Steps 1 and 2 levels, or the legal or
policy basis for the Tailoring Rule. By the same token, as noted
previously in section V, in this rulemaking, we are relying on the same
methodology used in the Tailoring Rule to calculate administrative
burdens, and we are not re-opening that methodology or soliciting
comment on it.\59\ We are simply proposing action and soliciting
comment on Step 3 of the phase-in approach.
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\59\ Although the Tailoring Rule has been challenged in the U.S.
Court of Appeals for the DC Circuit, no party has challenged this
methodology.
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2. Call for Additional Information Concerning State Burdens
As stated in the Tailoring Rule, the EPA is committed to tailoring
the applicability criteria that determine which GHG emission sources
become subject to the PSD and title V programs of the CAA. The
following questions are structured to help the EPA best assess the
status of GHG permitting programs based on the three criteria outlined
in the Tailoring Rule, which forms the basis for this action. We
request states submit responses to the following questions to the
appropriate EPA Regional Administrator within 45 days after the date of
publication of this proposal in the Federal Register.
General Permitting Burden/Resources
1. Does your state currently have the necessary resources (funding
and staff) to run the PSD and title V permitting program as they exist
today?
a. If your state is strained for resources please describe the
reasons for it? Please list all that apply and provide a short
description of the problem providing specific information where
possible (i.e., budget cuts of 10 percent during the last year; hiring
freeze; loss 3 FTE in last two years).
i. GHG Permitting
ii. Other Permitting Issues (SO2, NO2, etc)
iii. Budget cuts
iv. Lack of personnel
v. Other (please specify)
2. If permitting activity were to increase to levels closer to
those
[[Page 14256]]
originally anticipated in the Tailoring Rule,\60\ would your state have
the necessary resources to manage the increased workload?
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\60\ See 75 FR 31540.
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a. If not, please estimate the level of additional resources
(funding and staff) your state would require to handle the increased
burden.
3. In providing perspective on the PSD program, consider the
following scenarios where your annual number of PSD permitting activity
were to increase by 10, 20, 30, 50, 100, and 200 permit actions per
year (both new permit applications and modifications included) due to
the potential lowering of the current GHG applicability thresholds.
When assessing the resources to permit these sources, consider that
many of the newly permitted GHG sources under this scenario would
likely consist of commercial and small industrial sources whose primary
GHG emissions units are small, similarly configured combustion units:
a. How many more full-time employees (FTEs) would your program need
to address each of these potential permitting activity increases (i.e.,
10, 20, 30, 50, 100, and 200 permit actions per year) in PSD due to
GHGs and still meet current PSD permit processing times?
b. How many additional dollars annually to your staffing budget
would these additional FTEs equate to?
4. How has GHG permitting affected the permitting process in your
state? Please consider the areas listed below and provide specific
estimates of the impact GHG permitting has had on your program where
possible (i.e., responded to 10 percent more permitting questions than
usual).
a. Number of source meetings.
b. Number of daily permitting questions.
c. Number of incomplete permit applications.
d. Training for permitting staff to understand the GHG permitting
process.
e. Is your staff unsure of how and when to permit GHG sources?
5. For states where PSD permits for GHG have been issued, how was
the burden (monetary and man-hours) compared to a typical non-GHG
permit? Please provide an estimate where possible (i.e., an additional
20 hours).
6. In providing perspective on the title V program, consider the
following scenarios where your annual number of title V permitting
activity were to increase by 10, 20, 30, 50, 100, and 200 permit
actions per year (both new permit applications and modifications
included) due to the potential lowering of the current GHG
applicability thresholds. When assessing the resources to permit these
sources, consider that many of the newly permitted GHG sources under
this scenario would likely consist of commercial and small industrial
sources whose primary GHG emissions units are small, similarly
configured combustion units:
a. How many more full-time employees (FTEs) would your program need
to address each of these potential permitting activity increases (i.e.,
10, 20, 30, 50, 100, and 200 permit actions per year) in title V due to
GHGs and still meet current title V permit processing times?
b. How many additional dollars annually to your staffing budget
would these additional FTEs equate to?
7. Does your state have an active outreach initiative and the
resources necessary to reach out to smaller sources that may not be
aware of their obligation to apply for title V or PSD permits due to
GHGs?
a. If the GHG permitting thresholds were lowered resulting in
additional sources being subject to the PSD and title V permitting
programs, how would this affect such initiative? Please be specific
about the level of resources necessary where possible.
8. Have the GHG requirements created or added to a backlog of
unissued permits?
a. If so, by what amount?
9. Has your state modified its title V fees to cover GHG permitting
needs? If not, would your state need to do so if additional sources
(i.e., 10, 20, 30, 50, 100, and 200 actions per year) were added to the
permitting programs as a result of lowered thresholds?
Streamlining Specific Questions
1. Is your state processing applications through any electronic
permitting measures? If not do you plan on implementing an type of
electronic permitting?
2. Has your state implemented LEAN techniques to streamline the
permitting process? If so, how has this improved the efficiency for
permitting actions? If not, do you plan on doing this in the future?
3. Is your state considering any other permitting streamlining
technique to help improve the efficiency and reduce the burden
associated with permitting of GHG sources? Please list all streamlining
techniques under consideration and the expected implementation
timelines.
B. Solicitation of Comment on Streamlining Techniques
In section VI of this preamble, we discuss a range of streamlining
techniques for GHG permitting. In this action we propose rulemaking to
implement two of these techniques at this time concerning PALs for GHGs
and creation of federal synthetic minor source permits for GHGs. For
the other techniques, we present information on the techniques but
propose no rulemaking at this time. We request comment on all these
potential streamlining techniques, as discussed in section VII and in
the following sections. More broadly, we request comment on other
approaches to streamlining that may hold promise to reduce PSD and/or
title V permitting burden for sources of GHGs and permitting
authorities. Please include as much detail as possible on how such an
approach would work, the amount of burden reduction that could be
achieved, the specific legal authority the EPA should rely upon for
implementing the approach, and whether EPA rulemaking would be required
for implementation.
1. Plantwide Applicability Limitations for GHGs
We request comment on our proposal to undertake rulemaking at this
time to provide a more flexible approach for GHG PALs. We further
request comment on which option we should pursue for this rulemaking,
the Major Source Opt-in Approach or the Minor Source Approach, and on
how, specifically, we should revise our rules to implement the
preferred approach. In our discussion of, and rationale for, GHG PALs
in section VI.A of this preamble, we requested comment on many
specific, related issues. We again request comment on those issues
here.
2. Synthetic Minor Source Permitting Authority for GHGs
We request comment on our proposal to create synthetic minor permit
authority, within the existing federal PSD regulations, for the purpose
of issuing synthetic minor permit limitations for GHGs. In addition, we
request comment on our legal authority for implementing such a program.
Finally, we again request comment on other specific, related issues on
which we requested comment in the discussion of synthetic minor permit
authority in section VI.B of this preamble.
[[Page 14257]]
3. Redefining PTE and Source Category Specific PTE
We request comment on the discussion in this proposal of our
current thinking on developing category specific PTE rules or guidance,
and on categories for which such a rule or guidance would be
appropriate. We also request comment on creating a rule that would
allow a source to use historical hours of operation in determining an
emissions unit's PTE. In addition, we request comment on the other
specific, related issues that we discussed and on which we requested
comment in the discussion of approaches to PTE in section VI.C of this
preamble.
4. General Permits for GHGs
We request comment on the idea of developing a rule that would
allow use of general permits for GHG sources, and on possible sources
and source categories that may benefit from general permits. We also
request information on the experience of state and local permitting
authorities with the use of general permits and their potential
applicability to GHG sources. In addition, we request comment on the
other specific, related issues that we discussed and on which we
requested comment in the discussion of general permits in section VI.D
of this preamble.
5. Presumptive BACT for GHGs
We request comment on the concept of developing presumptive BACT
for sources of GHGs, and on possible source categories and emissions
units that may be promising candidates for this approach. We request
comment on how and when to update presumptive BACT determinations, on
the use of presumptive BACT for general permits, and on the appropriate
public participation for the development and application of presumptive
BACT. In addition, we request comment on the other specific, related
issues that we discussed and on which we requested comment in the
discussion of presumptive BACT in section VI.E of this preamble.
6. Title V Empty Permits
We request comment on the extent to which SIPs contain requirements
that would be applicable to sources that would be subject to title V
solely as a result of emissions of GHGs below the current thresholds
established by the Tailoring Rule, and whether a significant number of
sources would have empty permits at different thresholds. We also
solicit comment on whether the EPA can, and should, interpret the title
V as not requiring ``empty permits,'' and if so whether state program
revisions, approved by the EPA, would, or should, be necessary to
exclude such sources from title V permit requirements. In addition, we
request comment on the other specific, related issues that we discussed
and on which we requested comment in the discussion of empty permits in
section VI.F of this preamble.
VIII. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review
Under Executive Order 12866 (58 FR 51735, October 4, 1993), this
action is a ``significant regulatory action'' because it raises novel
legal or policy issues. Accordingly, the EPA submitted this action to
the OMB for review under Executive Orders 12866 and 13563 (76 FR 3821,
January 21, 2011) and any changes made in response to OMB
recommendations have been documented in the docket for this action.
This proposed Step 3 of the Tailoring Rule would continue the
phased-in approach begun in Steps 1 and 2. However, we have determined
that it would not be appropriate at this time to expand the universe of
large sources of GHG emissions that must comply with permitting
requirements under the Act, and the proposed rule would not reduce the
GHG applicability thresholds or bring more sources into the PSD or
title V programs. Thus, the proposed rule would not impose any costs on
sources of GHGs to obtain permits or on permitting authorities to issue
permits.
B. Paperwork Reduction Act
This action does not impose any new information collection burden.
The proposed rule would not change the existing GHG permitting
thresholds, and therefore would not impose any additional burden on
sources to obtain PSD or title V permits or on permitting authorities
to issue such permits. The proposed provisions for GHG PALs and
synthetic minor source permitting authority would have the effect of
reducing permitting burden in that the burden associated with obtaining
or issuing a PAL permit or synthetic minor permit would be more than
offset through avoiding subsequent PSD permitting actions with greater
associated burden. However, if in the context of the final rule we
determine that the provisions for PALs and synthetic minors impose new
information collection burden, we will adjust the information
collection requirements accordingly. The OMB has previously approved
the information collection requirements contained in the existing
regulations for the NSR and title V programs under the provisions of
the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned
OMB control number 2060-0003 to the NSR program and OMB control numbers
2060-0243 and 2060-0336 to the title V program (40 CFR Part 70 and Part
71 components, respectively). The OMB control numbers for EPA's
regulations in 40 CFR are listed in 40 CFR Part 9.
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency
to prepare a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements under the Administrative
Procedures Act or any other statute unless the agency certifies that
the rule will not have a significant economic impact on a substantial
number of small entities. Small entities include small businesses,
small organizations and small governmental jurisdictions.
For purposes of assessing the impacts of this proposed action on
small entities, small entity is defined as: (1) A small business that
is a small industrial entity as defined in the U.S. Small Business
Administration (SBA) size standards (see 13 CFR 121.201); (2) a small
governmental jurisdiction that is a government of a city, county, town,
school district or special district with a population of less than
50,000; or (3) a small organization that is any not-for-profit
enterprise that is independently owned and operated and is not dominant
in its field.
After considering the economic impacts of this proposed action on
small entities, I certify that this proposed action will not have a
significant economic impact on a substantial number of small entities.
In determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analysis is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the rule on small entities.'' 5 U.S.C. 603 and 604.
Thus, an agency may certify that a rule will not have a significant
economic impact on a substantial number of small entities if the rule
relieves regulatory burden, or otherwise has a positive economic
effect, on all of the small entities subject to the rule.
[[Page 14258]]
The proposed rule would not change the existing GHG permitting
thresholds, and therefore would not impose any additional burden on any
sources (including small entities) to obtain PSD or title V permits or
on any permitting authorities (including small entities, if any) to
issue such permits. The proposed provisions for GHG PALs and synthetic
minor source permitting authority would have the effect of reducing
permitting burden on all entities, including small entities, in that
the burden associated with obtaining or issuing a PAL permit or
synthetic minor permit would be more than offset through avoiding
subsequent PSD permitting actions with greater associated burden. We
have therefore concluded that this proposed rule will be neutral or
relieve the regulatory burden for all affected small entities. We
continue to be interested in the potential impacts of the proposed rule
on small entities and welcome comments on issues related to such
impacts. In addition while we propose to maintain the current
thresholds in this rulemaking, we also solicit comment on lowering the
thresholds. If we receive information that persuades us that we should
take action to lower the thresholds, we will at that time reassess the
applicability of the requirements of the Regulatory Flexibility Act.
D. Unfunded Mandates Reform Act
This rule does not contain a federal mandate that may result in
expenditures of $100 million or more for state, local and tribal
governments, in the aggregate, or the private sector in any 1 year. The
proposed rule would not change the existing GHG permitting thresholds,
and therefore would not impose any additional burden on sources to
obtain PSD or title V permits or on permitting authorities to issue
such permits. The proposed provisions for GHG PALs and synthetic minor
source permitting authority would have the effect of reducing
permitting burden in that the burden associated with obtaining or
issuing a PAL permit or synthetic minor permit would be more than
offset through avoiding subsequent PSD permitting actions with greater
associated burden. Thus, this rule is not subject to the requirements
of sections 202 or 205 of UMRA.
This rule is also not subject to the requirements of section 203 of
UMRA because it contains no regulatory requirements that might
significantly or uniquely affect small governments. As noted
previously, the effect of the proposed rule would be neutral or relieve
regulatory burden.
E. Executive Order 13132: Federalism
This proposed rule does not have federalism implications. It will
not have substantial direct effects on the states, on the relationship
between the national government and the states or on the distribution
of power and responsibilities among the various levels of government,
as specified in Executive Order 13132. This proposed rule would
maintain the existing structure of the PSD and title V programs and
would not, therefore, affect the relationship between the national
government and the states or the distribution of power and
responsibilities among the various levels of government. In addition,
the proposed rule would not change the existing GHG permitting
thresholds, and therefore would not impose any additional burden on
state permitting authorities to issue PSD or title V permits or such
permits. The proposed provisions for GHG PALs and synthetic minor
source permitting authority would have the effect of reducing
permitting burden in that the burden associated with issuing a PAL
permit or synthetic minor permit would be more than offset through
avoiding subsequent PSD permitting actions with greater associated
burden.
In the spirit of Executive Order 13132, and consistent with EPA
policy to promote communications between the EPA and state and local
governments, the EPA specifically solicits comment on this proposed
rule from state and local officials.
F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
This action does not have tribal implications. There are no tribal
authorities currently issuing major NSR permits, one tribe is
implementing a title V program based on a delegation agreement under 40
CFR Part 71 and one tribe has recently obtained approval of title V
program under 40 CFR Part 70. However, the proposed rule would not
change the existing GHG permitting thresholds, and therefore would not
impose any additional burden on sources to obtain PSD or title V
permits or on permitting authorities to issue such permits. The
proposed provisions for GHG PALs and synthetic minor source permitting
authority would have the effect of reducing permitting burden in that
the burden associated with obtaining or issuing a PAL permit or
synthetic minor permit would be more than offset through avoiding
subsequent PSD permitting actions with greater associated burden.
Although Executive Order 13175 does not apply to this proposed
rule, the EPA specifically solicits additional comment on this proposed
action from tribal officials.
G. Executive Order 13045: Protection of Children From Environmental
Health and Safety Risks
The EPA interprets Executive Order 13045 (62 FR 19885, April 23,
1997) as applying only to those regulatory actions that concern health
or safety risks, such that the analysis required under section 5-501 of
the Executive Order has the potential to influence the regulation. This
action is not subject to Executive Order 13045 because it does not
establish an environmental standard intended to mitigate health or
safety risks.
H. Executive Order 13211: Actions That Significantly Affect Energy
Supply, Distribution or Use
This action is not a ``significant energy action'' as defined in
Executive Order 13211 (66 FR 28355, May 22, 2001), because it is not
likely to have a significant adverse effect on the supply, distribution
or use of energy. Further, we have concluded that this rule is not
likely to have any adverse energy effects because this action would not
create any new requirements for sources in the energy supply,
distribution or use sectors.
I. National Technology Transfer and Advancement Act
Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (NTTAA), Public Law 104-113, 12(d) (15 U.S.C. 272 note)
directs the EPA to use voluntary consensus standards in its regulatory
activities unless to do so would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., materials specifications, test methods, sampling
procedures and business practices) that are developed or adopted by
voluntary consensus standards bodies. The NTTAA directs the EPA to
provide Congress, through the OMB, explanations when the agency decides
not to use available and applicable voluntary consensus standards.
This proposed rulemaking does not involve technical standards.
Therefore, the EPA did not consider the use of any voluntary consensus
standards.
[[Page 14259]]
J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations
Executive Order 12898 (59 FR 7629, February 16, 1994) establishes
federal executive policy on environmental justice. Its main provision
directs federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies and activities on minority populations and low-income
populations in the United States.
The EPA has determined that this proposed rule will not have
disproportionately high and adverse human health or environmental
effects on minority or low-income populations because it does not
affect the level of protection provided to human health or the
environment. The proposed rule would not change the existing GHG
permitting thresholds, and therefore would not affect the universe of
sources subject to permitting.
K. Determination Under Section 307(d)
Pursuant to sections 307(d)(1)(J) and 307(d)(1)(V) of the CAA, the
Administrator determines that this action is subject to the provisions
of section 307(d). Section 307(d)(1)(J) specifies that the provisions
of section 307(d) apply to ``promulgation or revision of regulations
under [part] C of title I (pertaining to prevention of significant
deterioration of air quality and protection of visibility).'' This
section clearly subjects the portions of this action that pertain to
PSD to the provisions of section 307(d). Section 307(d)(1)(V) provides
that the provisions of section 307(d) apply to ``such other actions as
the Administrator may determine.'' Pursuant to this section, the
Administrator determines that the portions of this action that pertain
to title V are subject to the provisions of section 307(d). This
determination allows for uniform treatment for all aspects of this
action.
IX. Statutory Authority
The statutory authority for this action is provided by sections
101, 111, 114, 116 and 301 of the CAA as amended (42 U.S.C. 7401, 7411,
7414, 7416 and 7601).
List of Subjects
40 CFR Part 49
Environmental protection, Administrative practice and procedure,
Air pollution control, Carbon dioxide, Carbon dioxide equivalents,
Greenhouse gases, Hydrofluorocarbons, Intergovernmental relations,
Methane, Nitrous oxide, Perfluorocarbons, Reporting and recordkeeping
requirements, Sulfur hexafluoride.
40 CFR Part 51
Environmental protection, Administrative practice and procedure,
Air pollution control, Carbon dioxide, Carbon dioxide equivalents,
Greenhouse gases, Hydrofluorocarbons, Intergovernmental relations,
Methane, Nitrous oxide, Perfluorocarbons, Reporting and recordkeeping
requirements, Sulfur hexafluoride.
40 CFR Part 52
Environmental protection, Administrative practice and procedure,
Air pollution control, Carbon dioxide, Carbon dioxide equivalents,
Greenhouse gases, Hydrofluorocarbons, Intergovernmental relations,
Methane, Nitrous oxide, Perfluorocarbons, Reporting and recordkeeping
requirements, Sulfur hexafluoride.
40 CFR Part 70
Environmental protection, Administrative practice and procedure,
Air pollution control, Carbon dioxide, Carbon dioxide equivalents,
Greenhouse gases, Hydrofluorocarbons, Intergovernmental relations,
Methane, Nitrous oxide, Perfluorocarbons, Reporting and recordkeeping
requirements, Sulfur hexafluoride.
40 CFR Part 71
Environmental protection, Administrative practice and procedure,
Air pollution control, Carbon dioxide, Carbon dioxide equivalents,
Greenhouse gases, Hydrofluorocarbons, Methane, Nitrous oxide,
Perfluorocarbons, Reporting and recordkeeping requirements, Sulfur
hexafluoride.
Dated: February 24, 2012.
Lisa P. Jackson,
Administrator.
For the reasons stated in the preamble, title 40, chapter I of the
Code of Federal Regulations is proposed to be amended as set forth
below.
PART 52--[AMENDED]
1. The authority citation for part 52 continues to read as follows:
Authority: 42 U.S.C. 7401, et seq.
Subpart A--[Amended]
2. In Sec. 52.21, add paragraph (dd) to read as follows:
Sec. 52.21 Prevention of significant deterioration of air quality.
* * * * *
(dd) Synthetic minor permits. The provisions in paragraphs (dd)(1)
through (dd)(7) of this section govern issuance of, and compliance
with, synthetic minor permits that the Administrator may issue to
owners or operators of GHG-emitting sources.
(1) Authority to issue GHG synthetic minor permits. (i) The
Administrator may issue a GHG synthetic minor permit, when requested by
the owner or operator of a GHG-emitting source that contains one or
more emissions limitations that have the effect of reducing the
potential to emit GHGs to:
(a) Below a level of GHG emissions (expressed as CO2e
and computed in accordance with paragraph (b)(49)(ii) of this section)
specified in the ``subject to regulation'' definition contained in
paragraph (b)(49)(iv) of this section;
(b) Below the major stationary source applicability thresholds
contained in paragraph (b)(1) of this section; and/or
(c) Below the significant rate contained in paragraph (b)(23)(i) of
this section, or when no significant rate for GHG is contained in that
paragraph, to a level of no net emissions increase as specified in
paragraph (b)(23)(ii) of this section.
(ii) The Administrator may issue a GHG synthetic minor permit for
purposes of:
(a) Allowing the GHG-emitting source to avoid applicability of
paragraphs (j) through (r)(5) of this section, for that source's GHG
emissions, or
(b) Establishing a creditable GHG emissions reduction on either a
tpy mass basis, or on a CO2e basis (as computed in
accordance with paragraph (b)(49)(ii) of this section).
(iii) Such permits shall contain restrictions that are legally
enforceable and enforceable as practical matter.
(iv) Nothing in this paragraph relieves an owner or operator of a
GHG-emitting source from complying with any federal or state
requirements that otherwise apply to the source.
(2) Definitions. For purposes of paragraph (dd) of this section,
the definitions in paragraphs (dd)(2)(i) through (iv) of this section
apply. When a term is not defined in these paragraphs, it shall have
the meaning given in paragraph (b) of this section or in the Act.
(i) Emissions limitation means a requirement established by the
Administrator which limits the quantity, rate, or concentration of GHG
emissions on a continuous basis, including any requirement relating to
the operation or maintenance of one or
[[Page 14260]]
more emissions units to assure continuous emissions reduction, and any
design standard, equipment standard, work practice, operational
standard, or pollution prevention technique when the Administrator can
compute the effect of such requirements on the potential to emit GHGs
of the emission unit(s)o and such requirement is legally enforceable
and enforceable as a practical matter.
(ii) GHG-emitting source means any stationary source that emits or
has the potential to emit GHGs in amounts that are at or above the
major stationary source thresholds contained in paragraph (b)(1) of
this section, and is also:
(a) A major stationary source for any other regulated NSR
pollutant;
(b) A new major stationary that will emit or have the potential to
emit 100,000 tpy CO2e; or
(c) A stationary source that emits or has the potential to emit
100,000 tpy CO2e.
(iii) GHG synthetic minor permit means a permit that the
Administrator issues to a GHG-emitting source that contains one or more
emissions limitations that allows the source to become a GHG synthetic
minor source; reduces potential to emit GHGs to a level below the
significant rate contained in paragraph (b)(23) of this paragraph;
reduces potential to emit GHGs to a level that assures that there is no
net emissions increase from the GHG-emitting source, and/or creates a
creditable emissions reduction for GHGs under paragraph (b)(3) of this
section.
(iv) GHG synthetic minor source means a GHG-emitting source that,
in absence of the Administrator's issuance of a synthetic minor permit,
would have the potential to emit GHGs in amounts that are at or above
the subject to regulation thresholds contained in paragraph (b)(49) of
this section, and the major stationary source thresholds contained in
paragraph (b)(1) of this section, but has obtained a synthetic minor
permit to limit the potential to emit GHGs to below either of these
amounts.
(3) Permit application requirements. As part of a permit
application requesting a GHG synthetic minor permit, the owner or
operator of a GHG-emitting source shall submit the following
information to the Administrator for approval:
(i) Identifying information, including the name and address of the
owner or operator (and plant name and address if different), and the
name and telephone number of the plant manager/contact.
(ii) A description of any ongoing or future planned construction
activity that involves or affects emission units identified in
paragraph (dd)(3)(iii) of this section, or involves construction of new
emissions unit(s); and the commencement date of construction, the
anticipated completion date, and the anticipated date each emissions
unit will resume or begin regular operations.
(iii) A list of all emissions units that are located at the GHG-
emitting source that emit GHGs; and any new emissions units identified
in paragraph (dd)(3)(ii) of this section.
(iv) For each emissions unit identified in paragraph (dd)(3)(iii)
of this section, the unit's potential to emit GHGs along with
supporting calculations.
(a) For purposes of this application, the potential to emit of each
emissions unit shall be computed without considering any emissions
limitations that might be established through the Administrator's
issuance of a GHG synthetic minor permit.
(b) Such calculations shall include fugitive emissions, to the
extent that they are quantifiable, if the emissions unit or GHG-
emitting source belongs to one of the source categories listed in
paragraph (b)(1)(iii) of this section.
(v) An identification of each emissions unit for which the permit
applicant requests that the Administrator establish an emissions
limitation, along with the following information:
(a) The proposed emissions limitation for each emissions unit and a
description of its effect on the potential to emit of the emissions
unit. The proposed emission limitations must be expressed over the
shortest practicable time period, taking into consideration the
operation of the source and the methods to be used for demonstrating
compliance.
(b) Proposed testing, monitoring, recordkeeping, and reporting
requirements to be used to demonstrate and assure compliance with the
proposed emissions limitation.
(c) A description of the production processes.
(d) Identification of the emissions units.
(e) Type and quantity of fuels and/or raw materials used, if
applicable.
(f) Description and estimated efficiency of air pollution control
equipment under present and anticipated operating conditions.
(g) Estimates of the current actual emissions, including all
calculations for the estimates.
(h) Estimates of the potential to emit that would result from
compliance with the proposed emissions limitation, including all
calculations for the estimates.
(i) An identification of other federal requirements with which the
emissions unit must comply.
(vi) Any other information specifically requested by the
Administrator.
(4) Procedures for obtaining a synthetic minor permit. (i) The
owner or operator of the GHG-emitting source must submit a permit
application to the Administrator. The application must contain the
information specified in paragraph (dd)(3) of this section.
Option 1 for paragraphs (dd)(4)(ii) and (iii):
(ii) Within 60 days after receipt of an application, the
Administrator will determine if it contains the information specified
in paragraph (dd)(3) of this section.
(iii) If the Administrator determines that the application is not
complete, the Administrator will request additional information from
the owner or operator as necessary to process the application. If the
Administrator determines that the application is complete, the
Administrator will notify the owner or operator in writing. The
Administrator should postmark the completeness determination or request
for additional information within 60 days of receipt of the permit
application. The application is deemed complete if the Administrator
does not request additional information, or send a notice of complete
application postmarked within 60 days of receipt of the permit
application.
Option 2 for paragraphs (dd)(4)(ii) and (iii):
(ii) Within 30 days after receipt of an application, the
Administrator will determine if it contains the information specified
in paragraph (dd)(3) of this section.
(iii) If the Administrator determines that the application is not
complete, the Administrator will request additional information from
the owner or operator as necessary to process the application. If the
Administrator determines that the application is complete, the
Administrator will notify owner or operator in writing. The
Administrator should postmark the completeness determination or request
for additional information within 30 days of receipt of the permit
application by the Administrator.
(iv) The Administrator will prepare a draft synthetic minor permit
that describes the proposed emissions limitation(s) and the effect of
such emissions limitation(s) on the potential emissions from any
projects identified in paragraph (dd)(3)(ii) of this section, and the
potential to emit GHGs of both
[[Page 14261]]
the emissions units identified in paragraph (dd)(3)(iii) of this
section and the GHG-emitting source.
(v) The Administrator must provide an opportunity for public
comment and public participation on the draft synthetic minor permit as
set out in paragraphs (dd)(6) of this section.
(vi) After the close of the public comment period, the
Administrator will review all comments received and either prepare a
final synthetic minor permit or a written explanation of the reasons
for a decision to deny the application for the synthetic minor permit.
(vii) The final synthetic minor permit is subject to administrative
and judicial review as set out in paragraph (dd)(7) of this section.
(5) Permit Content. The permit must include the requirements in
paragraphs (dd)(5)(i) through (vii) of this section.
(i) General Requirements. The following elements must be included
in the permit:
(a) The effective date of the permit, and an effective date for any
terms and conditions of the permit, if such date differs from the
effective date of the permit; and
(b) An identification of the emissions units subject to the permit
and each emissions unit's associated emissions limitations.
(ii) Emissions limitations. The permit must contain one or more
emissions limitations. Each emissions limitation must meet the
requirements of paragraphs (dd)(5)(ii)(a) through (d) of this section.
(a) To effectively reduce the potential to emit of one or more
emissions units at the GHG-emitting source, the permit must include an
emissions limitation that is legally enforceable and enforceable as a
practical matter, and is expressed over the shortest practicable time
period, generally not to exceed a 12-month rolling total.
(b) Such emissions limitation must consist of one or more numerical
limitations on the quantity, rate, or concentration of GHG emissions on
either a mass or CO2e basis that is expressed over the
shortest practical time period and that is legally enforceable and
enforceable as a practical matter. If it is impracticable to impose a
numerical limitation, then the Administrator may establish pollution
prevention requirements, design standards, equipment standards, work
practices, operational standards, or maintenance standards, when the
Administrator can compute the effect of such restrictions on the
emissions unit's or GHG-emitting source's potential to emit GHG and the
requirements are legally enforceable and enforceable as a practical
matter. The Administrator may also establish any combination of the
above requirements.
(c) A statement that the emissions limitation applies at all times
including startup, shutdown, and malfunction unless a separate
emissions limitation applies to these emissions, and such emissions are
expressly excluded from an emissions limitations, or the Administrator
directs otherwise in the permit.
(d) The calculation procedure the owner or operator will use to
convert the monitoring system data to emissions data to demonstrate
compliance with the emissions limitation.
(iii) Monitoring requirements. The permit must include monitoring
requirements sufficient to assure compliance with the emissions
limitations. The Administrator must require, as appropriate, any of the
requirements in paragraphs (dd)(5)(iii)(a) and (b) of this section.
(a) A requirement to monitor, including analysis procedures, test
methods, periodic testing, instrumental monitoring, and non-
instrumental monitoring. Such monitoring requirements shall assure use
of test methods, units, averaging periods, and other statistical
conventions consistent with the required emissions limitations.
(b) As necessary, requirements concerning the use, maintenance, and
installation of monitoring equipment or methods.
(iv) Recordkeeping requirements. The permit must include
recordkeeping requirements sufficient to assure compliance with the
emissions limitations and monitoring requirements, and must require the
elements in paragraphs (dd)(5)(iv)(a) through (c) of this section.
(a) Records of required monitoring information that include the
information in paragraphs (dd)(5)(iv)(a)(1) through (6) of this
section, as appropriate.
(1) The location, date, and time of sampling or measurements.
(2) The date(s) analyses were performed.
(3) The company or entity, and the name of the specific individuals
that performed the analyses.
(4) The analytical techniques or methods used.
(5) The results of such analyses.
(6) The operating conditions existing at the time of sampling or
measurement.
(b) Retention for 5 years of records of all required monitoring
data and support information for the monitoring sample, measurement,
report, or application. Support information may include all calibration
and maintenance records, all original strip-chart recordings or digital
records for continuous monitoring instrumentation, and copies of all
reports required by the permit.
(c) A copy of the synthetic minor permit application and any
additional information requested by the Administrator to support the
application.
(v) Reporting requirements. The permit must include the reporting
requirements in paragraphs (dd)(5)(v)(a) through (d) of this section.
(a) Annual submittal of total GHG emissions and calculations for
each emissions unit subject to an emissions limitation in the synthetic
minor permit. Such calculations shall be based on the terms and
conditions in the permit that limit GHG emissions. Where necessary for
a calculation of annual GHG emissions, the permit must require
reporting of actual hours of operation, material used, and other
relevant metrics.
(b) Prompt reporting of deviations from permit requirements,
including those attributable to upset conditions as defined in the
permit, the probable cause of such deviations, and any corrective
actions or preventive measures taken. Within the permit, the
Administrator must define ``prompt'' in relation to the degree and type
of deviation likely to occur and the applicable emissions limitations.
(c) For each requirement in the permit, an annual submission of a
compliance certification signed by the owner or operator, attesting to
the GHG-emitting source's compliance with such requirement, or a
statement that the GHG-emitting source failed to comply with the
requirement and an explanation of such non-compliance. For purposes of
complying with this reporting requirement, the owner or operator may
concurrently attest to all requirements with which it complied, but
must address each requirement with which it failed to comply
separately.
(d) A requirement to notify the Administrator in writing within 30
days from the date the operator begins actual construction, and any
construction activity completes, and when regular operations begin, for
any project involving or affecting any emissions unit that is subject
to a requirement in the synthetic minor permit.
(e) A requirement to provide all reports electronically, unless the
Administrator has not provided a system for such electronic reporting.
(1) For projects involving or affecting multiple emissions units,
the notification must be submitted within
[[Page 14262]]
30 days from when such activities first occur for any emissions unit.
(2) If such activity was not already described in the permit
application as required by paragraph (dd)(3) of this section, the
notification shall identify the emissions units involved in or affected
by the project, and describe the nature of the construction activity
and any affect such activity will have on the potential to emit of an
emissions unit, or on the GHG-emitting source, otherwise the
notification should reference the permit application.
(vi) Severability clause. A statement stating that the provisions
of this synthetic minor permit are severable, and if any provision of
the permit is held invalid, the remainder of the permit shall not be
affected.
(vii) Additional provisions. The permit must also contain
provisions stating the requirements in paragraphs (dd)(5)(vii)(a)
through (g) of this section.
(a) You, as the permittee, must comply with all conditions of your
permit, including emissions limitations that apply to the emissions
units at your source. Noncompliance with any permit term or condition
is a violation of the permit and may constitute a violation of the Act
and is grounds for enforcement action and for a permit termination or
revocation.
(b) It is not a defense for you, as the permittee, in an
enforcement action that it would have been necessary to halt or reduce
the permitted activity in order to maintain compliance with the
conditions of this permit.
(c) The Administrator may reopen, revise, terminate or revoke the
permit. The filing of a request by you, as the permittee, for a permit
revision, revocation, or termination, or of a notification of planned
changes or anticipated noncompliance does not stay any permit
condition.
(d) The permit does not relieve the permittee from complying with
any federal or state requirements that otherwise apply to the source.
(e) The permit does not convey any property rights of any sort or
any exclusive privilege.
(f) You, as the permittee, shall furnish to the Administrator,
within a reasonable time, any information that the Administrator may
request in writing to determine whether cause exists for reopening,
revising, revoking, or terminating the permit or to determine
compliance with the permit. For any such information claimed to be
confidential, you must also submit a claim of confidentiality in
accordance with part 2, subpart B of this chapter.
(g) You, as the permittee, must allow a representative of the
Administrator (who must comply with the safety requirements of the
permittee) to:
(1) Enter upon your premises where the source is located or
emissions-related activity is conducted, or where records are required
to be kept under the conditions of the permit;
(2) Have access to and copy, at reasonable times, any records that
are required to be kept under the conditions of the permit;
(3) Inspect, during normal business hours or while the source is in
operation, any facilities, equipment (including monitoring and air
pollution control equipment), practices, or operations regulated or
required under the permit;
(4) Sample or monitor, at reasonable times, substances or
parameters for the purpose of determining compliance with the permit or
other applicable requirements; and
(5) Record any inspection by use of written, electronic, magnetic,
and photographic media.
(6) Public participation requirements. This paragraph applies to
the issuance of synthetic minor permits.
(i) Public availability of documents. With the exception of any
confidential information as defined in part 2, subpart B of this
chapter, the Administrator must make available for public inspection
the documents listed in paragraphs (dd)(6)(i)(a) through (d) of this
section. The Administrator must make such information available for
public inspection at the appropriate EPA Regional Office.
(a) All information submitted as part of an application for a
permit.
(b) Any additional information requested by the Administrator.
(c) The Administrator's analysis of the application and any
relevant, additional information submitted by the source.
(d) A copy of the draft permit or the decision to deny the permit
with the justification for denial.
(ii) Public notice requirements. (a) Before issuing a synthetic
minor permit, the Administrator must prepare a draft permit and must
provide adequate public notice to ensure that the area affected has
reasonable access to the application and draft permit information, as
set out in paragraphs (dd)(6)(ii)(a)(1) and (2) of this section. The
public notice must provide an opportunity for public comment, and may
provide notice of a public hearing on the draft permit.
(1) The Administrator must mail a copy of the notice to the GHG-
emitting source, and the state, and local air pollution authorities
having jurisdiction in the area in which the GHG-emitting source is
located.
(2) The Administrator will use appropriate means of notification,
depending on such factors as the nature and size of your source, local
air quality considerations, and the characteristics of the population
in the affected area. Appropriate means include those listed in
paragraphs (dd)(6)(ii)(a)(2)(i) through (v) of this section.
(i) The Administrator may mail or email a copy of the notice to
persons on a mailing list developed by the Administrator consisting of
those persons who have requested to be placed on such a mailing list.
(ii) The Administrator may post the notice on its Web site.
(iii) The Administrator may publish the notice in a newspaper of
general circulation in the area affected by the source.
(iv) The Administrator may provide copies of the notice for posting
at one or more locations in the area affected by the source, such as
post offices, trading posts, libraries, tribal environmental offices,
community centers, or other gathering places in the community.
(v) The Administrator may employ other means of notification as
appropriate.
(b) The notice required pursuant to paragraph (dd)(6)(ii)(a) of
this section must include the following information at a minimum:
(1) Identifying information, including the name and address of the
owner and operator of the GHG-emitting source (and plant name and
address if different) and the name and telephone number of the plant
manager/contact;
(2) The name and address of the reviewing authority processing the
permit action;
(3) An explanation of any emissions changes that will result from
the permit action;
(4) A description of the proposed emissions limitation(s) and its
effect on the potential to emit of a project, one or more emissions
units, or the GHG-emitting source;
(5) Instructions for requesting a public hearing;
(6) The name, address, and telephone number of a contact person in
the reviewing authority's office from whom additional information may
be obtained;
(7) Locations and times of availability of the information (listed
in paragraph (dd)(6)(i) of this section) for public inspection; and
(8) A statement that any person may submit written comments, a
written request for a public hearing, or both, on the draft permit
action and the time frames by which any person must take such
action(s).
[[Page 14263]]
(iii) Public comment. (a) The Administrator must provide at least
30 days from the date of public notice provided under paragraph
(dd)(6)(ii) of this section for the public to submit comments on the
draft permit. The Administrator may extend this period if he or she
determines it is appropriate to do so.
(b) Any person may submit written comments on the draft permit
during the public comment period. These comments must raise any
reasonably ascertainable issue with supporting arguments by the close
of the public comment period.
(c) The public comment period under paragraph (dd)(6)(iii)(a) of
this section will not close before the date of any public hearing held
in accordance with paragraph (dd)(6)(iv) of this section. The hearing
officer may also extend the comment period by so stating at the
hearing.
(iv) Public Hearing. (a) Any person may request a public hearing on
a permit, but such request must be submitted to the Administrator, in
writing, and must state the nature of the issues proposed to be raised
at the hearing, and must be postmarked no later than 15 days after the
Administrator provides public notice of the draft permit under
paragraph (dd)(6)(ii) of this section.
(b) The Administrator must hold a hearing whenever there is, on the
basis of requests and the issues raised therein, a significant degree
of public interest in a draft permit. The Administrator may also hold a
public hearing at the Administrator's discretion whenever, for
instance, such a hearing might clarify one or more issues involved in
the permit decision.
(c) The Administrator must provide notice, consistent with the
requirements in paragraph (dd)(6)(ii) of this section, that the
Administrator will hold a public hearing. Such notice must be provided
at least 15 days before the date of the hearing. Public notice of the
hearing may be concurrent with that of the draft permit, and the two
notices may be combined.
(d) The Administrator may set reasonable limits on the time allowed
for oral statements at the hearing.
(e) The Administrator must make a tape recording or written
transcript of any hearing available to the public as part of the final
administrative record for the permit under paragraph (dd)(7)(iii) of
this section.
(7) Final permit issuance and administrative and judicial review--
(i) Notification of the final permit decision. The Administrator must
notify the GHG-emitting source of the final permit decision, in
writing, and if the permit is denied, of the reasons for such denial.
The Administrator must also provide adequate public notice of the final
permit decision, consistent with the provisions in paragraph
(dd)(6)(ii) of this section.
(ii) Effective date of the permit. A final permit becomes effective
30 days after the Administrator issues the permit, unless:
(a) A later effective date is specified in the permit; or
(b) Review of the final permit is request under paragraph
(dd)(7)(iv), in which case the effective date of the permit is stayed
until the Administrator issues a notice of final agency action under
paragraph (dd)(7)(iv)(b), unless the Administrator notifies the
Environmental Appeals Board, and the applicant, and all of the
interested parties, that the permit contains uncontested and severable
conditions, in which case, these conditions shall become fully
effective enforceable obligations of the permit as specified in
paragraph (dd)(7)(ii)(a) of this section, but the remainder of the
permit conditions will be stayed as specified in this paragraph; or
(c) The Administrator may make the permit effective immediately
upon issuance if no comments requested a significant change in the
draft permit or provided a technical justification for why the
Administrator should deny the permit.
(iii) Administrative record. (a) The Administrator must base final
permit decisions on an administrative record consisting of:
(1) The application and any supporting data furnished by the
applicant;
(2) The draft permit or notice of intent to deny the application;
(3) Other documents in the supporting files for the draft permit
that the Administrator considered in the decisionmaking;
(4) All significant comments received during the public comment
period;
(5) The tape or transcript or other electronic record of any
hearing(s) held;
(6) Any written material submitted at such hearing(s);
(7) Any new materials placed in the record as a result of the
Administrator's evaluation of public comments;
(8) The final permit; and
(9) Other documents in the supporting files for the final permit
that the Administrator considered in the final decisionmaking.
(b) The Administrator must add the additional documents required
under paragraph (dd)(7)(iii)(a) of this paragraph to the record as soon
as possible after their receipt or preparation by the Administrator.
The record is complete on the date the Administrator issues the final
permit.
(c) Material readily available or published materials that are
generally available and that are included in the administrative record
under the standards of paragraph (dd)(7)(iii)(a) of this paragraph need
not be physically included in the same file as the rest of the record
as long as it is specifically referred to in the that file.
(iv) Appealing a permit decision. Permit decisions may be appealed
according to the following provisions:
(a) The Administrator delegates authority to the Environmental
Appeals Board (the Board) to issue final decisions in permit appeals
filed under this program. An appeal directed to the Administrator,
rather than to the Board, will be forwarded to the Board for
consideration. This delegation does not preclude the Board from
referring an appeal or a motion under this program to the Administrator
when the Board, in its discretion, deems it appropriate to do so. When
an appeal or motion is referred to the Administrator by the Board, all
parties shall be so notified and the provisions of this program
referring to the Board shall be interpreted as referring to the
Administrator.
(b) Any person seeking to appeal a permit decision must follow the
provisions for PSD permits in Sec. 124.19 of this chapter.
(c) The final synthetic minor permit is subject to administrative
and judicial review as set out in Sec. 124.19 of this chapter.
(v) Permit Revisions. (a) The Administrator may reopen, revise,
terminate, or revoke requirements within the synthetic minor permit, or
may take such action on the entirety of the synthetic minor permit.
Such actions may be taken by the Administrator for cause on its own
initiative, or at the request of the permittee.
(b) Except for administrative permit revisions identified in
paragraph (dd)(7)(vi) of this section, the Administrator shall follow
all of the public participation requirements in paragraphs (dd)(6) of
this section before revising, revoking, or terminating requirements in
the synthetic minor permit.
(c) All changes to a permit are subject to the effective date, and
administrative review requirements contained in paragraph (dd)(7)(i)
through (iv) of this section.
[[Page 14264]]
(vi) Administrative permit revision. The following provisions
govern administrative permit revisions.
(a) An administrative permit revision is a permit revision that
makes any of the following changes:
(1) Corrects typographical, calculation or other errors.
(2) Identifies a change in the name, address, or phone number of
any person identified in the permit, or provides a similar minor
administrative change at the source.
(3) Requires more frequent monitoring or reporting by the
permittee.
(4) Allows for a change in ownership or operational control of a
GHG-emitting source when the Administrator determines that no other
change in the permit is necessary, provided that a written agreement
containing a specific date for transfer of permit responsibility,
coverage, and liability between the current and new permittee has been
submitted to the Administrator.
(5) Incorporates any other type of change that the Administrator
determines is similar to those in paragraphs (dd)(7)(vi)(a)(1) through
(5) of this section.
(b) An administrative permit revision is not subject to the permit
application, issuance, public participation or administrative
requirements of this program.
[FR Doc. 2012-5431 Filed 3-7-12; 8:45 am]
BILLING CODE 6560-50-P
