Limited Approval and Disapproval of Air Quality Implementation Plans; Nevada; Clark County; Stationary Source Permits, 43206-43216 [2012-18077]

Agencies

• ENVIRONMENTAL PROTECTION AGENCY

[Federal Register Volume 77, Number 142 (Tuesday, July 24, 2012)]
[Proposed Rules]
[Pages 43206-43216]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-18077]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2012-0566; FRL-9703-8]


Limited Approval and Disapproval of Air Quality Implementation 
Plans; Nevada; Clark County; Stationary Source Permits

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing a limited approval and limited disapproval of 
revisions to the Clark County portion of the applicable state 
implementation plan (SIP) for the State of Nevada. The submitted 
revisions include new and amended rules governing the issuance of 
permits for stationary sources, including review and permitting of 
major sources and major modifications under parts C and D of title I of 
the Clean Air Act (CAA). The intended effect of this proposed limited 
approval and limited disapproval action is to update the applicable SIP 
with current Clark County permitting rules and to set the stage for 
remedying certain deficiencies in these rules. If finalized as 
proposed, this limited disapproval action would trigger an obligation 
on EPA to promulgate a Federal

[[Page 43207]]

Implementation Plan unless Nevada submits and we approve SIP revisions 
that correct the deficiencies within two years of the final action, and 
for certain deficiencies the limited disapproval would also trigger 
sanctions under section 179 of the CAA unless Nevada submits and we 
approve SIP revisions that correct the deficiencies within 18 months of 
final action.

DATES: Written comments must be received on or before August 23, 2012.

ADDRESSES: Submit comments, identified by Docket ID Number EPA-R09-OAR-
2012-0566, by one of the following methods:
    1. Federal eRulemaking Portal: www.regulations.gov. Follow the on-
line instructions.
    2. Email: R9airpermits@epa.gov.
    3. Mail or deliver: Gerardo Rios (AIR-3), U.S. Environmental 
Protection Agency, Region IX, 75 Hawthorne Street, San Francisco, CA 
94105-3901. Deliveries are only accepted during the Regional Office's 
normal hours of operation.
    Instructions: All comments will be included in the public docket 
without change and may be made available online at www.regulations.gov, 
including any personal information provided, unless the comment 
includes Confidential Business Information (CBI) or other information 
whose disclosure is restricted by statute. Information that you 
consider CBI or otherwise protected should be clearly identified as 
such and should not be submitted through www.regulations.gov or email. 
www.regulations.gov is an anonymous access system, and EPA will not 
know your identity or contact information unless you provide it in the 
body of your comment. If you send email directly to EPA, your email 
address will be automatically captured and included as part of the 
public comment. If EPA cannot read your comment due to technical 
difficulties and cannot contact you for clarification, EPA may not be 
able to consider your comment.
    Docket: Generally, documents in the docket for this action are 
available electronically at www.regulations.gov and in hard copy at EPA 
Region IX, 75 Hawthorne Street, San Francisco, California. While all 
documents in the docket are listed at www.regulations.gov, some 
information may be publicly available only at the hard copy location 
(e.g., copyrighted material, large maps), and some may not be publicly 
available in either location (e.g., CBI). To inspect the hard copy 
materials, please schedule an appointment during normal business hours 
with the contact listed in the FOR FURTHER INFORMATION CONTACT section.

FOR FURTHER INFORMATION CONTACT: Laura Yannayon, by phone: (415) 972-
3534 or by email at yannayon.laura@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document, the terms ``we,'' 
``us,'' and ``our'' refer to EPA.

Table of Contents

I. The State's Submittals
    A. Which rules did the State submit?
    B. What are the existing Clark County rules governing stationary 
source permits in the Nevada SIP?
    C. What is the purpose of this proposed rule?
II. EPA's Evaluation
    A. How is EPA evaluating the rules?
    B. Do the rules meet the evaluation criteria?
    1. Minor Source Permits
    2. Prevention of Significant Deterioration
    3. Nonattainment New Source Review
    4. Section 110(l) of the Act
    5. Conclusion
III. Public Comment and Proposed Action
IV. Statutory and Executive Order Reviews

I. The State's Submittals

A. Which rules did the State submit?

    On February 11, 2010, September 1, 2010, and May 22, 2012, the 
Clark County Department of Air Quality (Clark or DAQ) submitted new and 
amended regulations to EPA for approval as revisions to the Clark 
County portion of the Nevada SIP under the Clean Air Act (CAA or Act). 
Collectively, the submitted regulations (referred to as ``Sections'') 
comprise DAQ's current program for preconstruction review and 
permitting of new or modified stationary sources under DAQ jurisdiction 
in Clark County, including related definitions.\1\ These SIP revision 
submittals, referred to herein as the ``NSR SIP submittal'' or 
``submitted NSR rules,'' represent a comprehensive revision to Clark 
County's preconstruction review and permitting program and are intended 
to satisfy the requirements under both part C (prevention of 
significant deterioration) (PSD) and part D (nonattainment new source 
review) of title I of the Act as well as the general preconstruction 
review requirements for minor sources under section 110(a)(2)(C) of the 
Act. These preconstruction review and permitting programs are often 
collectively referred to as ``New Source Review'' (NSR).
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    \1\ The submitted program relies upon certain definitions 
contained in submitted Section 0 as well as the definition of 
``ambient air quality standards'' in DAQ Section 11, which EPA 
previously approved into the Nevada SIP (69 FR 54006, September 7, 
2004) and is not included in this submittal.
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    It should be noted that pursuant to State law, the State of Nevada, 
not a local air district, has jurisdiction over plants which generate 
electricity by using steam produced by the burning of fossil fuel 
within the State of Nevada. The applicable State law, now codified in 
Nevada Revised Statutes (NRS) 445B.500, was approved by EPA in 1980 as 
NRS 445.546(4). See 45 FR 46384 (July 10, 1980) (now codified at 40 CFR 
52.1470(e)). Thus, the State, not DAQ, has jurisdiction over such 
plants that are located or that will be constructed within Clark 
County. The submitted NSR rules therefore apply to stationary sources 
located in Clark County, except for plants which generate electricity 
by using steam produced by the burning of fossil fuel, which are 
subject to the Nevada Division of Environmental Protection's (NDEP) 
jurisdiction.
    Table 1 lists the rules addressed by this proposal with the dates 
that they were adopted by DAQ and submitted to EPA by NDEP, which is 
the governor's designee for  Nevada SIP submittals.
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    \2\ DAQ also included a permitting regulation called ``Section 
12.11 (General Permits For Minor Stationary Sources)'' as part of 
its NSR SIP Submittal but we are not proposing action on this 
regulation at this time.

                    Table 1--Submitted NSR Rules \2\
------------------------------------------------------------------------
      Section No.         Section title       Adopted        Submitted
------------------------------------------------------------------------
0.....................  Definitions.....          3/6/12         5/22/12
12.0..................  Applicability,           11/3/09         2/11/10
                         General
                         Requirements
                         and Transition
                         Procedures.
12.1..................  Permit                   11/3/09         2/11/10
                         Requirements
                         for Minor
                         Sources.
12.2..................  Permit                    3/6/12         5/22/12
                         Requirements
                         for Major
                         Sources in
                         Attainment
                         Areas
                         (Prevention of
                         Significant
                         Deterioration).
12.3..................  Permit                   5/18/10         9/01/10
                         Requirements
                         for Major
                         Sources in
                         Nonattainment
                         Areas.

[[Page 43208]]

 
12.4..................  Authority to             5/18/10         9/01/10
                         Construct
                         Application and
                         Permit
                         Requirements
                         For Part 70
                         Sources \3\.
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    On August 11, 2010  and March 1, 2011, DAQ's February 11, 2010 and 
September 1, 2010 submittals were deemed by operation of law to meet 
the completeness criteria in 40 CFR part 51, appendix V, which must be 
met before formal EPA review. We find that DAQ's May 22, 2012 submittal 
also meets the appendix V completeness criteria. Each of these 
submittals includes evidence of public notice and adoption of the 
regulation. While we can act only on the most recently submitted 
version of each regulation (which supersedes earlier submitted 
versions), we have reviewed materials provided with previous 
submittals. Our technical support document (TSD) provides additional 
background information on each of the submitted rules.
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    \3\ Section 12.4 also contains requirements to address the CAA 
title V requirements for operating permit programs, but we are not 
evaluating the rule for title V purposes at this time. We will 
evaluate Section 12.4 for compliance with the requirements of title 
V of the Act and EPA's implementing regulations in 40 CFR part 70 
following receipt of an official part 70 program submittal from 
Clark County containing this rule.
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B. What are the existing Clark County rules governing stationary source 
permits in the Nevada SIP?

    The existing SIP-approved NSR program for new or modified 
stationary sources in Clark County consists of one State regulation and 
seven Clark County regulations (``Sections''), or portions thereof, 
which EPA approved on April 14, 1981, June 18, 1982, June 21, 1981, and 
September 7, 2004. See 46 FR 21758 (April 14, 1981) (final rule 
approving DAQ Section 1); 47 FR 26620 (June 21, 1982) (final rule 
approving revisions to DAQ Section 1); 47 FR 26386 (June 18, 1982) 
(final rule approving DAQ Section 16); and 69 FR 54006 (September 7, 
2004) (final rule approving, in whole or in part, DAQ Sections 0, 11, 
12, 58, and 59, and Nevada Administrative Code (NAC) 445B.22083). 
Collectively, these regulations established the NSR requirements for 
both major and minor stationary sources under DAQ jurisdiction in Clark 
County, including requirements for the generation and use of emission 
reduction credits in nonattainment areas.
    Consistent with Clark's stated intent to have the submitted NSR 
rules replace the existing SIP NSR program in its entirety, EPA's 
approval of the regulations identified above in table 1 would have the 
effect of entirely superseding, or rescinding our prior approval of, 
all but two of the rules in the current SIP-approved program. Table 2 
lists the existing rules in the Nevada SIP governing NSR for stationary 
sources under DAQ jurisdiction. All of these rules except for Section 
11 and NAC section 445B.22083 would be replaced in, or otherwise 
deleted from, the SIP by the submitted set of rules listed in table 1 
if EPA were to take final action as proposed herein. Section 11 is a 
rule that defines DAQ's ``ambient air quality standards.'' NAC 
445B.22083 is a regulation adopted by the Nevada State Environmental 
Commission (SEC) that prohibits the construction of new power plants or 
major modifications to existing power plants under State jurisdiction 
within specified areas designated nonattainment for certain NAAQS 
within Clark County.\4\ Our proposed action would have no effect on 
Section 11 or NAC 445B.22083, both of which remain part of the 
applicable Nevada SIP.
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    \4\ As explained further in the TSD, EPA's approval of NAC 
445B.22083 in 2004 resolved a regulatory gap that would otherwise 
exist in connection with NSR for major stationary sources and major 
modification under NDEP jurisdiction (i.e., major new or modified 
plants which generate electricity by using steam produced by the 
burning of fossil fuel, see NRS 445B.500) within the nonattainment 
portions of Clark County.

 Table 2--Existing SIP Rules Governing NSR for Stationary Sources Under
                            DAQ Jurisdiction
------------------------------------------------------------------------
                                                      Fed. Reg. citation
       Section No.               Section title         and EPA approval
                                                             date
------------------------------------------------------------------------
0........................  Definitions.............  69 FR 54006, 9/7/
                                                      04.
1........................  Definitions (33 terms     46 FR 21758, 4/14/
                            retained in SIP in 69     81 and 47 FR
                            FR 54006, 9/7/04).        26620, 6/21/82.
11.......................  Ambient Air Quality       69 FR 54006, 9/7/
                            Standards.                04.
12.......................  Preconstruction Review    69 FR 54006, 9/7/
                            for New or Modified       04.
                            Stationary Sources.
16.......................  Operating Permits.......  47 FR 26386, 6/18/
                                                      82.
58.......................  Emission Reduction        69 FR 54006, 9/7/
                            Credits.                  04.
59.......................  Emission Offsets........  69 FR 54006, 9/7/
                                                      04.
NAC 445B.22083...........  Construction, major       69 FR 54006, 9/7/
                            modification or           04.
                            relocation of plants to
                            generate electricity
                            using steam produced by
                            burning of fossil fuels.
------------------------------------------------------------------------

C. What is the purpose of this proposed rule?

    The purpose of this proposed rule is to present our evaluation 
under the CAA and EPA's regulations of the new and amended NSR rules 
submitted by DAQ on February 11, 2010, September 1, 2010, and May 22, 
2012, as identified in table 1. We provide our reasoning in general 
terms below but provide more detailed analysis in our technical support 
document (TSD), which is available in the docket for this proposed 
rulemaking.

II. EPA's Evaluation

A. How is EPA evaluating the rules?

    EPA has reviewed the rules submitted by DAQ governing NSR for 
stationary sources under DAQ jurisdiction for compliance with the CAA's 
general requirements for SIPs in CAA section 110(a)(2), EPA's 
regulations for stationary source permitting programs in 40 CFR part 
51, sections 51.160 through 51.164, and the CAA requirements for SIP 
revisions in CAA section 110(l).\5\ As described below,

[[Page 43209]]

EPA is proposing a limited approval and limited disapproval of the 
submitted NSR rules.
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    \5\ CAA section 110(l) requires SIP revisions to be subject to 
reasonable notice and public hearing prior to adoption and submittal 
by States to EPA and prohibits EPA from approving any SIP revision 
that would interfere with any applicable requirement concerning 
attainment and reasonable further progress, or any other applicable 
requirement of the CAA.
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B. Do the rules meet the evaluation criteria?

    With respect to procedures, CAA sections 110(a) and 110(l) require 
that revisions to a SIP be adopted by the State after reasonable notice 
and public hearing. EPA has promulgated specific procedural 
requirements for SIP revisions in 40 CFR part 51, subpart F. These 
requirements include publication of notices, by prominent advertisement 
in the relevant geographic area, of a public hearing on the proposed 
revisions, a public comment period of at least 30 days, and an 
opportunity for a public hearing.
    Based on our review of the public process documentation included in 
the February 11, 2010, September 1, 2010, and May 22, 2012 submittals, 
we find that DAQ has provided sufficient evidence of public notice and 
opportunity for comment and public hearings prior to adoption and 
submittal of these rules to EPA.
    With respect to substantive requirements, we have evaluated each 
``Section'' of DAQ's submitted NSR rules in accordance with the CAA and 
regulatory requirements that apply to: (1) General preconstruction 
review programs for minor sources under section 110(a)(2)(C) of the 
Act, (2) PSD permit programs under part C of title I of the Act, and 
(3) Nonattainment NSR permit programs under part D of title I of the 
Act. For the most part, the submitted NSR rules satisfy the applicable 
requirements for these three permit programs and would strengthen the 
applicable SIP by updating the regulations and adding requirements to 
address new or revised NSR permitting requirements promulgated by EPA 
in the last several years, but the submitted NSR rules also contain 
specific deficiencies which prevent full approval. Below, we discuss 
generally our evaluation of DAQ's submitted NSR rules and the 
deficiencies that are the basis for our proposed limited disapproval of 
these rules. Our TSD contains a more detailed evaluation and 
recommendations for program improvements.
1. Minor Source Permits
    Section 110(a)(2)(C) of the Act requires that each SIP include a 
program to provide for ``regulation of the modification and 
construction of any stationary source within the areas covered by the 
plan as necessary to assure that national ambient air quality standards 
are achieved, including a permit program as required in parts C and D'' 
of title I of the Act. Thus, in addition to the permit programs 
required in parts C and D of title I of the Act, which apply to new or 
modified ``major'' stationary sources of pollutants, each SIP must 
include a program to provide for the regulation of the construction and 
modification of any stationary source within the areas covered by the 
plan as necessary to assure that the NAAQS are achieved. These general 
pre-construction requirements are commonly referred to as ``minor NSR'' 
and are subject to EPA's implementing regulations in 40 CFR 51.160-
51.164.
    Section 12.1 contains the requirements for review and permitting of 
individual minor stationary sources under DAQ jurisdiction in Clark 
County, and Section 12.4 contains the requirements for review and 
permitting of modifications at major stationary sources that are not 
``major modifications'' and therefore not subject to PSD or 
Nonattainment NSR. These regulations satisfy most of the statutory and 
regulatory requirements for minor NSR programs, but Section 12.1 also 
contains several deficiencies that form the basis for our proposed 
limited disapproval, as discussed below.
    First, one of the key control requirements in Section 12.1 appears 
to depend upon a definition of ``ambient air quality standards'' that 
is not consistent with the NAAQS. Specifically, subsection 12.1.4.1(c) 
requires that each minor source permit issued by Clark include emission 
limitations that ensure that ``[t]he ambient air quality standards will 
be attained or maintained'' (12.1.4.1(c)) and appears to depend upon 
DAQ's definition of ``ambient air quality standards'' in Section 11, 
which does not include the 2006 24-hour PM2.5 NAAQS of 35 
ug/m3 or the 2008 Lead (Pb) NAAQS of 15 ug/m3 (rolling 3-month 
average). See 40 CFR 50.13 and 50.16. EPA approved Section 11 into the 
Clark County portion of the Nevada SIP on September 7, 2004 (69 FR 
54006), and at the time this definition was consistent with the Federal 
NAAQS, but given EPA's promulgation of revised NAAQS for 
PM2.5 and Lead (Pb) in 2006 and 2008, respectively, Section 
11 is no longer consistent with the NAAQS. As such, with respect to the 
2006 24-hour PM2.5 NAAQS and the 2008 Lead NAAQS, Section 
12.1 does not provide a means for determining whether the construction 
or modification of a stationary source will result in a violation of 
applicable portions of the control strategy or interference with 
attainment or maintenance of the NAAQS, as required by 40 CFR 51.160.
    Second, subsection 12.1.3.6(a)(5) provides that an applicant may 
identify specific portions of a permit that it wants to be Federally 
enforceable. This is not consistent with CAA requirements, as all 
conditions of a permit issued pursuant to a SIP-approved permit program 
are Federally enforceable. See CAA 113, 304; see also 40 CFR 52.23. As 
a general matter, we note that any statement contained in a permit 
application regarding Federal enforceability has no effect on EPA's or 
citizens' enforcement authorities under sections 113 and 304 of the 
Act.
    Third, neither Section 12.1 nor Section 12.4 contain a provision 
addressing, for minor stationary sources, the requirement in 40 CFR 
51.160(d) to ``provide that approval of any construction or 
modification must not affect the responsibility on the owner or 
operator to comply with applicable portions of the control strategy.''
    Fourth, Section 12.1 provides (in subsection 12.1.2(a)) an 
exemption from permitting requirements for ``[c]onstruction and 
operation of any emission units or performance of any of the activities 
listed in'' a separate rule called Section 12.5, which addresses the 
operating permit requirements of title V of the CAA. Because Section 
12.5 is neither approved into the SIP nor included in the NSR SIP 
submittal, we cannot conclude that this exemption is appropriate for 
minor NSR purposes.
    Fifth, the applicability provisions in Section 12.1 (in particular 
the definition of ``minor source'' in subsection 12.1.1(c)) are 
deficient as they do not address sources of PM2.5 or 
PM2.5 precursor emissions. Pursuant to CAA section 
110(a)(2)(C), States were required to amend their minor source programs 
to include direct PM2.5 emissions and precursor emissions in 
the same manner as included for purposes of PM2.5 major NSR. 
See 73 FR 28321, 28344 (May 16, 2008). In the absence of applicability 
provisions that appropriately capture minor sources of PM2.5 
or their precursors, Section 12.1 does not provide for protection of 
the PM2.5 NAAQS in the issuance of permits for new or 
modified minor sources as required by 40 CFR 51.160-51.164.
    Finally, Section 12.1 does not contain any provisions designed to 
ensure that the air quality impacts of stationary sources are not 
underestimated due to stack heights that exceed good

[[Page 43210]]

engineering practice or air dispersion modeling techniques that do not 
satisfy the criteria in 40 CFR 51.118(b), as required by 40 CFR 51.164.
    Compared to the existing SIP minor NSR program in Section 12 (as 
adopted October 7, 2003), however, submitted Section 12.1 and Section 
12.4 represent an overall strengthening of DAQ's minor NSR program. For 
example, the new rules establish more detailed monitoring, 
recordkeeping, and reporting requirements, more specific criteria for 
permit applications and conditions for permit issuance, and well-
defined criteria for the determination of emission limits and standards 
that represent ``reasonably available control technology,'' which we 
expect will allow for more effective implementation and enforcement of 
the requirements applicable to minor stationary sources in Clark 
County. See, e.g., Section 12.1, subsections 12.1.4.1. and 12.1.5.1, 
compared with SIP Section 12 (as adopted October 7, 2003), subsections 
12.1.1. and 12.8.2.
2. Prevention of Significant Deterioration
    Part C of title I of the Act contains the provisions for the 
prevention of significant deterioration (PSD) of air quality in areas 
designated ``attainment'' or ``unclassifiable'' for the NAAQS, 
including preconstruction permit requirements for new major sources or 
major modifications proposing to construct in such areas. EPA's 
regulations for PSD permit programs are found in 40 CFR 51.166 and 40 
CFR 52.21. Clark County is currently designated as ``attainment'' or 
``unclassifiable/attainment'' for all NAAQS pollutants, except for the 
PM10 standard in Las Vegas Valley (hydrographic area 
212) and for the 1997 8-hour ozone standard in Las Vegas 
Valley and additional portions of the county. See 40 CFR 81.329.
    Section 12.2 and Section 12.4 contain the requirements for review 
and permitting of PSD sources under DAQ jurisdiction in Clark County. 
These regulations satisfy most of the statutory and regulatory 
requirements for PSD permit programs, but Section 12.2 also contains 
several deficiencies that form the basis for our proposed limited 
disapproval, as discussed below.
    First, the definition of ``allowable emissions'' in subsection 
12.2.2(b) provides for calculation of emissions rates based on 
``practically enforceable'' permit limits, in lieu of federally 
enforceable limits, but it does not provide criteria by which a limit 
will be judged to be ``practically enforceable'' by DAQ. This 
definition also allows for permit conditions with ``future compliance 
dates'' to be used to determine allowable emissions, which is not 
consistent with EPA's definition of the term in 40 CFR 51.166(b)(16).
    Second, the definition of ``baseline actual emissions'' (BAE) in 
subsection 12.2.2(c), paragraph (1)(B)(i), includes a requirement to 
adjust the BAE downward to ``exclude any emissions that would have 
exceeded an emission limitation with which the major stationary source 
must comply as of the particular date, had such major stationary source 
been required to comply with such limitations during the consecutive 
24-month period'' (emphasis added). EPA's definition of BAE in 40 CFR 
51.166(b)(47)(ii)(c) includes a similar provision but requires a 
downward adjustment in BAE ``to exclude any emissions that would have 
exceeded an emission limitation with which the major stationary source 
must currently comply. * * *'' The reference in subsection 12.2.2(c) to 
an emission limitation that applied ``as of the particular date'' 
instead of an emission limitation with which the source must 
``currently comply'' is problematic, as it is not clear which 
``particular date'' the definition refers to.
    Third, the definition of ``net emissions increase'' (NEI) in 
subsection 12.2.2(ii) contains several provisions in subparagraph 
(1)(C) for calculating ``actual emissions after the contemporaneous 
project'' which are not consistent with EPA's definition of NEI in 40 
CFR 51.166(b)(3). EPA's definition of NEI allows for consideration of 
those emission increases and decreases that are ``contemporaneous'' 
with the project under review but does not call for any assessment of 
actual emissions after a contemporaneous project. 40 CFR 51.166(b)(3). 
Additionally, subparagraph (1)(C)(ii) allows for the calculation of NEI 
to be based on ``projected actual emissions'' in certain cases, which 
is not allowed under EPA's definition of NEI in 40 CFR 51.166(b)(3).
    Fourth, the definition of ``major modification'' in subsection 
12.2.2(dd) is not consistent with EPA's current approach to the 
treatment of fugitive emissions in applicability determinations for 
major modifications. Specifically, subsection 12.2.2(dd) requires, in 
subparagraph (4), that fugitive emissions be excluded from the 
determination of whether a particular physical or operational change is 
a major modification ``unless the major stationary source is a 
categorical stationary source or belongs to any other stationary source 
category which, as of August 7, 1980, is being regulated under Section 
111 or 112 of the Act.'' Although this language is consistent with the 
text of 40 CFR 51.166(b)(2)(v) as of July 1, 2010, EPA has 
administratively stayed this paragraph indefinitely, effective March 
30, 2011. See 76 FR 17548 (final rule effectuating and extending stay 
of the final rule entitled ``Prevention of Significant Deterioration 
(PSD) and Nonattainment New Source Review (NSR): Reconsideration of 
Inclusion of Fugitive Emissions'' (``Fugitive Emissions Rule'') 
published December 19, 2008). The effect of this administrative stay 
was to revert the treatment of fugitive emissions in applicability 
determinations to the approach that applied prior to the Fugitive 
Emissions Rule, thus requiring that fugitive emissions be included in 
``major modification'' applicability determinations for all source 
categories. 76 FR at 17550, 17551.
    Fifth, the definition of ``regulated NSR pollutant'' in subsection 
12.2.2(pp) does not satisfy current requirements regarding 
identification of precursors and treatment of ``condensable particular 
matter'' in PSD applicability determinations. EPA's definition of 
``regulated NSR pollutant'' in 40 CFR 51.166(b)(49)(i) requires 
identification of specific precursors for ozone and PM2.5 
purposes. Additionally, EPA's definition of ``regulated NSR pollutant'' 
in 40 CFR 51.166(b)(49) includes a paragraph (vi) stating that on or 
after January 1, 2011, ``gaseous emissions from a source or activity 
which condense to form particulate matter at ambient temperatures'' 
(i.e., condensable particular matter) must be accounted for in 
applicability determinations and in establishing emissions limitations 
for particulate matter (PM), PM2.5 and PM10 in 
PSD permits. See 73 FR 28321 (May 16, 2008) (final rule to implement 
NSR and PSD requirements for PM2.5).
    Sixth, one provision governing ``Plantwide Applicability Limits'' 
(PALs) in subsection 12.2.19 is not entirely consistent with EPA's 
requirement regarding the timeframe for adjustment of a PAL to address 
compliance dates that occur during the PAL effective period. 
Specifically, where the compliance date for a State or Federal 
requirement that applies to the PAL source occurs during the PAL 
effective period, subsection 12.2.9 allows for a PAL to be adjusted 
``at the time the affected Part 70 Operating Permit is renewed,'' 
rather than ``at the time of PAL permit renewal or title V permit 
renewal, whichever occurs first,'' as required by 40 CFR 
51.166(w)(10)(v) (emphases added). This is a deficiency

[[Page 43211]]

because, although Part 70 permits are renewed more frequently than PAL 
permits, at any given time it is possible that the expiration date for 
a PAL permit will occur before the expiration date for a Part 70 
permit.
    Finally, neither Section 12.2 nor Section 12.4 contains a provision 
addressing, for new or modified major stationary sources, the 
requirement in 40 CFR 51.160(d) to ``provide that approval of any 
construction or modification must not affect the responsibility on the 
owner or operator to comply with applicable portions of the control 
strategy.''
    Compared to the existing SIP PSD program in Section 12 (as adopted 
October 7, 2003), however, submitted Section 12.2 and Section 12.4 
represent an overall strengthening of DAQ's PSD program, in large part 
because Section 12.2 includes updated PSD provisions to regulate new or 
modified major stationary sources of greenhouse gases (GHGs) and 
PM2.5, both of which are unregulated under the existing SIP 
PSD program. Section 12.2 also satisfies the requirements of EPA's 2002 
regulations to revise the NSR programs (67 FR 80186, December 31, 2002) 
(``NSR Reform'' rules), with limited exceptions.
3. Nonattainment New Source Review
    Part D of title I of the Act contains the general requirements for 
areas designated ``nonattainment'' for the NAAQS, including 
preconstruction permit requirements for new major sources or major 
modifications proposing to construct in such nonattainment areas, 
commonly referred to as ``Nonattainment New Source Review'' or ``NSR.'' 
EPA's regulations for NSR permit programs are found in 40 CFR 51.165. 
Clark County is currently designated as ``attainment'' or 
``unclassifiable/attainment'' for all NAAQS pollutants, with two 
exceptions: certain portions of Clark County are designated and 
classified as ``marginal'' nonattainment for the 1997 8-hour ozone 
NAAQS, and the Las Vegas planning area within Clark County is 
designated and classified as ``serious'' nonattainment for the 
PM10 NAAQS. 40 CFR 81.329.
    Section 12.3 and Section 12.4 contain the NSR requirements for 
review and permitting of major sources and major modifications under 
DAQ jurisdiction in Clark County. These regulations satisfy most of the 
statutory and regulatory requirements for NSR permit programs, but 
Section 12.3 also contains several deficiencies that form the basis for 
our proposed limited disapproval, as discussed below.
    First, the requirements for offsets in Section 12.3, subsection 
12.3.6 do not contain adequate provisions to assure that emission 
offset calculations are based on the same emissions baseline used in 
the demonstration of reasonable further progress for the relevant NAAQS 
pollutant (where applicable) and to satisfy EPA's NSR criteria for 
offset calculations, as required by CAA section 173(a)(1)(A) and 40 CFR 
51.165(a)(3).
    Second, Section 12.3 does not contain provisions to assure that 
emissions increases from new or modified major stationary sources are 
offset by real reductions in ``actual emissions'' as required by CAA 
173(c)(1) because it does not contain adequate criteria for determining 
whether certain emission reductions may qualify for use as offsets. 
Subsection 12.3.6 references a separate rule (Section 12.7) for 
important criteria related to this determination, but Section 12.7 is 
neither approved into the SIP nor included in the NSR SIP submittal and 
therefore cannot provide an appropriate basis for evaluating emission 
reductions for purposes of satisfying the requirements in CAA section 
173(c)(1).
    Third, Section 12.3 does not adequately address the requirement in 
CAA section 173(c)(2) to prevent emissions reductions ``otherwise 
required by [the Act]'' from being credited for purposes of satisfying 
the part D offset requirements. Specifically, although subsection 
12.3.6.6(a) states that ``[e]mission reductions used to satisfy offset 
requirements must be real, surplus, permanent, quantifiable, and 
federally enforceable'' (emphasis added), the definition of the term 
``surplus'' in subsection 12.3.2 is not adequate to ensure that 
emission reductions required by standards promulgated under CAA section 
111 (New Source Performance Standards) or under CAA section 112 
(National Emission Standards for Hazardous Air Pollutants) are not 
credited for purposes of satisfying part D offset requirements.
    Fourth, the definition of ``baseline actual emissions'' (BAE) in 
subsection 12.3.2(c), paragraph (1)(C), includes a requirement to 
adjust the BAE downward to ``exclude any emissions that would have 
exceeded an emission limitation with which the major stationary source 
must comply as of the particular date, had such major stationary source 
been required to comply with such limitations during the consecutive 
24-month period'' (emphasis added). EPA's definition of BAE in 40 CFR 
51.165(a)(1)(xxxv)(B)(3) includes a similar provision but requires a 
downward adjustment in BAE ``to exclude any emissions that would have 
exceeded an emission limitation with which the major stationary source 
must currently comply. * * *'' The reference in subsection 12.3.2(c) to 
an emission limitation that applied ``as of the particular date'' 
instead of an emission limitation with which the source must 
``currently comply'' is problematic, as it is not clear which 
``particular date'' the definition refers to.
    Fifth, the definition of ``major modification'' in subsection 
12.3.2(x) requires exclusion of two specific types of physical or 
operational changes that EPA's definition of ``major modification'' in 
40 CFR 51.165(a)(1)(v) does not exclude: (1) the installation or 
operation of a permanent Clean Coal Technology Demonstration Project 
that constitutes repowering; and (2) the reactivation of a very clean 
coal-fired electric utility steam generating unit. Although such 
exemptions are acceptable for purposes of PSD review (see 40 CFR 
51.166(b)(2)(iii) and (b)(36)), such exemptions are not permissible for 
Nonattainment NSR purposes. See CAA 415.
    Additionally, the definition of ``major modification'' in 
subsection 12.3.2(x) is not consistent with EPA's current approach to 
the treatment of fugitive emissions in applicability determinations for 
major modifications. As discussed above with respect to the definition 
of this same term in Section 12.2, EPA has administratively stayed 40 
CFR 51.165(a)(1)(v)(G), effective March 30, 2011 (see 76 FR 17548), 
which had the effect of reverting the treatment of fugitive emissions 
in applicability determinations to the approach that applied prior to 
the Fugitive Emissions Rule, thus requiring that fugitive emissions be 
included in ``major modification'' applicability determinations for all 
source categories. 76 FR at 17550, 17551.
    Sixth, the definition of ``regulated NSR pollutant'' in subsection 
12.3.2(ii) does not satisfy current requirements regarding 
``condensable particular matter'' in NSR applicability determinations. 
EPA's definition of ``regulated NSR pollutant'' in 40 CFR 
51.165(a)(xxxvii) includes a paragraph stating that on or after January 
1, 2011, ``gaseous emissions from a source or activity which condense 
to form particulate matter at ambient temperatures'' (i.e., condensable 
particular matter) must be accounted for in applicability 
determinations and in establishing emissions limitations for 
particulate matter (PM), PM2.5 and PM10 in NSR 
permits. See 73 FR 28321.
    Seventh, Section 12.3 allows for interpollutant trades between VOC 
and NOX emission reductions for purposes

[[Page 43212]]

of satisfying offset requirements for ozone, and interpollutant trades 
among PM2.5, SO2 and NOX emission 
reductions for purpose of satisfying offset requirements for 
PM2.5. These provisions do not satisfy EPA's regulatory and 
policy criteria for approval of such interpollutant trades or 
interprecursor trading hierarchies. See 40 CFR 51.165(a)(11) and 
``Improving Air Quality with Economic Incentive Programs,'' U.S. EPA 
Office of Air and Radiation, January 2001. Although Section 12.3 does 
not currently apply to PM2.5 sources because Clark County is 
designated attainment/unclassifiable for the 1997 and 2006 
p.m.2.5 NAAQS, we propose to disapprove this provision 
because it is contrary to applicable EPA regulations and policy for 
both ozone and PM2.5 purposes.
    Eighth, Section 12.3 does not contain any provisions designed to 
ensure that the air quality impacts of stationary sources are not 
underestimated due to stack heights that exceed good engineering 
practice or air dispersion modeling techniques that do not satisfy the 
criteria in 40 CFR 51.118(b), as required by 40 CFR 51.164.
    Finally, neither Section 12.3 nor Section 12.4 contain a provision 
addressing, for new or modified major stationary sources, the 
requirement in 40 CFR 51.160(d) to ``provide that approval of any 
construction or modification must not affect the responsibility on the 
owner or operator to comply with applicable portions of the control 
strategy.''
    Compared to the existing SIP NSR program in Section 12 (as adopted 
October 7, 2003), however, submitted Section 12.3 and Section 12.4 
represent an overall strengthening of DAQ's NSR program, in large part 
because Section 12.3 contains definitions of important NSR terms, such 
as ``potential to emit,'' that are more consistent with EPA's 
definitions in 40 CFR 51.165(a) than the definitions used in the SIP 
NSR program (see, e.g., definition of ``total potential to emit'' in 
SIP Section 12, subsection 12.1.6.1). Section 12.3 also satisfies the 
requirements of EPA's 2002 NSR Reform rules, with limited exceptions.
4. Section 110(l) of the Act
    Section 110(l) prohibits EPA from approving a revision of a plan if 
the revision would ``interfere with any applicable requirement 
concerning attainment and reasonable further progress * * * or any 
other applicable requirement of [the Act].''
    Our approval of the Clark County NSR SIP submittal (and replacement 
or supersession of the existing SIP NSR rules) would strengthen the 
applicable SIP in some specific respects and would relax the SIP in 
other specific respects. Taken in its entirety, we find that the SIP 
revision represents a strengthening of Clark County's minor NSR, PSD, 
and Nonattainment NSR programs compared to the existing SIP programs 
that we approved in 1982 and 2004, and that our approval of the NSR SIP 
submittal would not interfere with any applicable requirement 
concerning attainment and reasonable further progress (RFP) or any 
other applicable requirement of the Act.
    The most significant deficiencies that we have identified in the 
submitted NSR rules, as discussed in detail earlier in this TSD, are 
generally as follows: (1) The absence of minor NSR provisions that 
ensure protection of the 2006 PM2.5 NAAQS and 2008 Lead (Pb) 
NAAQS; (2) minor NSR applicability provisions that do not cover 
stationary sources of PM2.5; (3) deficiencies in the 
definitions of certain terms used in PSD and Nonattainment NSR (NNSR) 
applicability determinations; (4) definition of ``regulated NSR 
pollutant'' that does not adequately address PSD and NNSR requirements 
for regulation of condensable particulate matter; (5) deficiencies in 
the criteria for assessing the quality (or ``integrity'') of emission 
reduction credits used to satisfy NNSR offset requirements; and (6) the 
absence of minor NSR or NNSR provisions to ensure that the air quality 
impacts of stationary sources are not underestimated due to stack 
heights that exceed good engineering practice or unacceptable air 
dispersion modeling techniques. We identify these as the ``most 
significant'' deficiencies because these are the most likely to affect 
pollutant emissions within Clark County, compared to other deficiencies 
that we do not expect would significantly affect emissions levels 
(e.g., administrative requirements for permit issuance).
    Many of these deficiencies are related to requirements that came 
into effect after we last approved Clark County's NSR programs in 1982 
and 2004. For example, minor NSR SIP revisions to implement the 2006 
PM2.5 NAAQS and 2008 Lead (Pb) NAAQS were due in 2009 and 
2011, respectively. See CAA 110(a). Similarly, SIP revisions to 
implement EPA's PSD and NNSR requirements for condensable particular 
matter were due in 2011. See 73 FR 28321 (May 16, 2008). With respect 
to all of these post-2005 requirements, which the existing SIP NSR 
program does not address, we believe it is reasonable to conclude that 
our approval of the NSR SIP submittal as a revision to the Nevada SIP 
would not interfere with any applicable requirement concerning 
attainment and RFP or any other applicable requirement of the Act, 
because there is no applicable requirement in the existing SIP program 
that would be affected by the deficiencies in the submitted NSR rules.
    As to the remaining deficiencies, we have evaluated these together 
with the most significant differences between the two NSR programs 
(SIP-approved versus the NSR SIP submittal) to evaluate the overall 
effect that our approval of the NSR SIP submittal might have on the 
stringency of DAQ's permit programs and the potential air quality 
impacts of these program revisions. First, certain PSD and NNSR 
definitions governing applicability determinations in Section 12.2 and 
Section 12.3 are not as stringent as the corresponding Federal 
definitions in 40 CFR 51.166 and 51.165, respectively. Second, the 
offset ratio in Section 12.3 is 1:1, compared to a more stringent ratio 
of 2:1 in the existing SIP NSR program, and the criteria in Section 
12.3 for evaluating the integrity of emissions reduction credits used 
to satisfy NNSR offset requirements are not adequate to assure actual 
emission reductions. Third, the minor NSR program and NNSR program 
(Sections 12.1, 12.3, and 12.4 to some extent) both lack provisions to 
ensure that the air quality impacts of stationary sources are not 
underestimated due to stack heights that exceed good engineering 
practice or unacceptable air dispersion modeling techniques. Fourth, 
DAQ has established public notice thresholds for minor NSR (Section 
12.1) that exclude from public review the following types of less-
environmentally significant minor sources: (1) New minor sources with 
potential emissions of NAAQS pollutants below 50 tons per year (tpy) 
for CO; 40 tpy for VOCs, SO2, or NOX; 15 tpy for 
PM10; and 0.6 tpy for Lead (Pb) (see subsection 12.1.5.3), 
and (2) modifications at existing minor sources that result in PTE 
increases less than 40 tpy for SO2; 35 tpy for CO; 20 tpy 
for VOC or NOX; and 7.5 tpy for PM10 (see 
subsection 12.1.6(a)(7)). Compare with SIP Section 12, subsection 
12.1.1.1 (requiring preconstruction review for ``any new stationary 
source'' or ``modification'' without emissions-based applicability 
thresholds). Finally, the control standard for minor sources has been 
changed from ``Best Available Control Technology'' under the SIP minor 
NSR program to ``Reasonably Available Control Technology'' under 
submitted Section 12.1 (see subsection 12.1.3.6(b), (c)).
    With respect to the scope of the NSR program, the deficiencies in 
the

[[Page 43213]]

applicability-related definitions in Sections 12.2 and 12.3 and the new 
de minimis thresholds established in Section 12.1 could potentially 
reduce the number of new or modified stationary sources that are 
subject to preconstruction review under these programs and thereby 
relax the NSR program for new and modified sources compared to the SIP-
approved program. As to the minor NSR control standard, the NNSR offset 
requirements, and the absence of provisions related to stack heights, 
the submitted NSR rules may result in application of less-stringent 
control technologies on minor sources (from BACT to RACT), potential 
under estimations of the air quality impacts of stationary source 
operations and, with respect to ozone precursor and PM10 
emissions, offset transactions that may not achieve adequate emission 
reductions.
    Several significant improvements in the submitted NSR rules should 
be considered in assessing the overall impact of these potential 
program relaxations. First, the potential for reduced numbers of 
regulated sources is offset to at least some extent by new provisions 
in Section 12.1 that establish a five-year permit term, thereby 
mandating a regular review of all minor source permit conditions and 
source operations, and provisions providing that DAQ may re-open a 
minor NSR permit at any time for cause. See ``Proposed Revision to the 
Clark County Part of the Nevada State Implementation Plan: Minor Source 
New Source Review Program Rule Adoptions and Revisions,'' January 29, 
2009 (hereinafter ``Minor NSR SIP Submittal''), Appendix B: ``Technical 
Requirements.''
    Second, Section 12.1 requires that each minor NSR permit contain a 
number of important types of permit terms and conditions which are more 
specific than required under the SIP NSR program and that strengthen 
the enforceability of the program--for example, physical descriptions 
of each emission unit, emission limitations that ensure protection of 
ambient air quality standards, and more clearly defined monitoring, 
recordkeeping, and reporting requirements modeled on the CAA's title V 
operating permit program. Compare Section 12.1, subsection 12.1.4.1 
(Term and Conditions) with SIP Section 12, subsection 12.8.1.1 
(conditions of ATC).
    Third, Section 12.1 contains important new conditions for issuance 
of minor NSR permits, such as the requirement to assure compliance with 
all applicable SIP requirements. See Section 12.1, subsection 12.1.5.1 
(Action on Application) compared to SIP Section 12 (as adopted October 
7, 2003), subsection 12.8.2 (ATC issuance requirements).
    Fourth, both the minor source program in Section 12.1 and the major 
source programs in Sections 12.2 and 12.3 rely on several new or 
revised definitions of key terms that are more consistent with Federal 
definitions (in CAA 302 and 40 CFR part 51, subpart I) than 
corresponding definitions in the SIP NSR program. See, e.g., definition 
of ``potential to emit'' in Section 0 \6\ compared to definition of 
``total potential to emit'' in SIP Section 12 (as adopted October 7, 
2003), subsection 12.1.6.1; new definition of ``emission limit'' or 
``emission limitation'' in Section 0.
---------------------------------------------------------------------------

    \6\ Section 12.1 establishes emission-based applicability 
thresholds based on a definition of ``potential to emit'' in 
submitted Section 0 that is generally equivalent to EPA's definition 
of this term in 40 CFR 51.165 and 51.166. The SIP NSR program in 
Section 12 (as adopted October 7, 2003), contains applicability 
provisions based on a definition of ``total potential to emit'' that 
is generally more expansive but allows, on the other hand, for 
certain engines categorized as ``special mobile equipment'' to be 
inappropriately exempt from the calculation of PTE (see SIP Section 
12, subsection 12.1.6.1).
---------------------------------------------------------------------------

    Finally, with respect to the difference between BACT and LAER for 
minor stationary sources in Clark County, supporting information 
submitted by DAQ indicates that the shift away from the existing BACT 
standard in the SIP is not likely to affect emissions to any 
significant degree given the ambiguities in the SIP rule which 
undermined the practical enforceability of this standard, and that the 
RACT standard in submitted Section 12.1 is expected to be equally 
effective in controlling emissions at minor sources, if not more so 
given the enhanced compliance provisions. See Minor NSR SIP Submittal, 
Chapter 3: ``Technical Support Document for Sections 0, 12.0, 12.1, and 
12.11'' at 3-20 to 3-28 and Appendix B: ``Technical Requirements.''
    With respect to offset requirements, we note that the SIP NSR 
program did not require offsets for VOC or NOX because Clark 
County was not designated nonattainment for any ozone NAAQS at the time 
when we approved the SIP program in 2004. See Section 59 (Emission 
Offsets), as adopted October 7, 2003 at Table 59.1.2. The NSR control 
(LAER) and offset requirements in submitted Section 12.3 therefore 
ensure greater reductions of ozone precursor emissions compared to the 
SIP program, which required neither LAER nor offsets for NOX 
or VOC.
    For PM10 purposes, the SIP NSR program required that 
major stationary sources (i.e., sources with PTE of 70 tpy or more) 
obtain PM10 offsets at a ratio of 2:1, whereas the submitted 
Section 12.3 requires those same sources to obtain PM10 
offsets at a ratio of 1:1. See Section 59 (Emission Offsets) (as 
adopted October 7, 2003) at Table 59.1.2 and Section 12.3 (Permit 
Requirements for Major Sources in Nonattainment Areas) (as adopted May 
18, 2010) at Table 12.3-1. This relaxation in the offset ratio for 
PM10 sources applies only to stationary sources locating 
within the boundaries of the PM10 nonattainment area in the 
Las Vegas planning area (hydrographic area 212), and appears 
to be counterbalanced by the overall strengthening in the NSR program, 
as discussed above with respect to both major and minor sources 
throughout Clark County.
    Significantly, the submitted Section 12.2 includes new PSD 
provisions to regulate new or modified major stationary sources of 
greenhouse gases (GHGs) and PM2.5, both of which are 
unregulated under the existing SIP PSD program. In addition, both 
Section 12.2 and Section 12.3 satisfy the requirements of EPA's 2002 
NSR Reform rules, with limited exceptions.
    In sum, the new and revised provisions in the submitted NSR rules 
enable DAQ to review source operations on a more regular basis; require 
DAQ to make specific determinations related to air quality impacts and 
applicable SIP requirements as part of permit issuance; improve the 
enforceability of the NSR program through the establishment of more 
detailed compliance requirements and improved definitions of important 
terms; establish NNSR requirements for ozone precursor emissions that 
were not required under the existing SIP program; and establish new PSD 
provisions for the regulation of GHG and PM2.5 emission 
sources. We find that, on balance, these NSR program improvements 
outweigh the potential relaxations discussed above compared to the 
existing SIP program.
    In addition, Clark County is currently designated attainment or 
unclassifiable/attainment for all but two NAAQS pollutants 
(PM10 and 1997 8-hour ozone), and with respect to these two 
remaining pollutants, EPA has determined based on ambient air 
monitoring data that the nonattainment areas within Clark County are 
attaining both of these standards. See 75 FR 45485 (August 3, 2010) 
(Determination of Attainment for PM10 for the Las Vegas 
Valley Nonattainment Area) and 76 FR 17343 (March 29, 2011) 
(Determination of Attainment for the Clark County 1997 8-Hour Ozone 
Nonattainment Area). We are unaware of any reliance by DAQ on the 
continuation of any aspect of the

[[Page 43214]]

permit-related rules in the Clark County portion of the Nevada SIP for 
the purpose of continued attainment or maintenance of the NAAQS. Given 
all these considerations and in light of the air quality improvements 
in Clark County, we propose to conclude that our approval of these 
updated NSR regulations into the Nevada SIP would not interfere with 
any applicable requirement concerning attainment and RFP or any other 
applicable requirement of the Act.
5. Conclusion
    For the reasons stated above and explained further in our TSD, we 
find that the submitted NSR rules satisfy most of the applicable CAA 
and regulatory requirements for minor NSR, PSD, and Nonattainment NSR 
permit programs under CAA section 110(a)(2)(C) and parts C and D of 
title I of the Act but also contain certain deficiencies that prevent 
us from proposing a full approval of the rules. Therefore, we are 
proposing a limited approval and limited disapproval of the submitted 
NSR rules. We do so based also on our finding that, while the rules do 
not meet all of the applicable requirements, the rules would represent 
an overall strengthening of the SIP by clarifying and enhancing the NSR 
permitting requirements for major and minor stationary sources under 
DAQ jurisdiction in Clark County.
    We note that, pursuant to EPA's recent classification of the Clark 
County ozone nonattainment area as ``marginal'' nonattainment for the 
1997 8-hour ozone standard effective June 13, 2012 (77 FR 28424, May 
14, 2012), DAQ is now obligated to submit NSR SIP revisions meeting the 
applicable requirements of subpart 2 of part D, title I of the Act, 
including an offset ratio of 1.1 to 1 for NOX and VOC (see 
CAA 182(a)(4)) no later than June 13, 2013. Likewise, with respect to 
stationary sources under NDEP jurisdiction (i.e., major new or modified 
plants which generate electricity by using steam produced by the 
burning of fossil fuel) within portions of Clark County that are 
designated nonattainment for the 1997 8-hour ozone standard, NDEP is 
obligated to submit, no later than June 13, 2013, NSR SIP revisions 
meeting the applicable requirements of subpart 2 of part D, title I of 
the Act. Although EPA is not requiring NDEP to submit Nonattainment NSR 
rules for the Las Vegas PM10 nonattainment area (i.e., 
hydrographic area 212) in light of the construction prohibition in NAC 
section 445B.22083,\7\ for the 1997 8-hour ozone NAAQS the geographic 
boundaries of the nonattainment area within Clark County extend beyond 
the areas subject to the construction prohibition in NAC 445B.22083. 
See 40 CFR 81.329. NDEP is therefore obligated to address this 
regulatory gap in Nonattainment NSR permit requirements for new or 
modified major sources in these areas. In lieu of adopting and 
submitting a Nonattainment NSR program, NDEP may revise NAC section 
445B.22083 to extend its construction prohibitions to the entire ozone 
nonattainment area within Clark County (as defined in 40 CFR 81.329) 
and submit this revised rule to EPA for approval into the SIP. These 
are not current program deficiencies but upcoming obligations on both 
NDEP's and DAQ's part that we encourage the State to address at its 
earliest opportunity.
---------------------------------------------------------------------------

    \7\ This rule prohibits the construction of new power plants or 
major modifications to existing power plants under State 
jurisdiction within the following areas: (a) Las Vegas Valley, 
Hydrographic Area 212; (b) El Dorado Valley, Hydrographic Area 167; 
(c) Ivanpah Valley, Hydrographic Areas 164 a and 164 b; and (d) The 
city limits of Boulder City. See NAC section 445B.22083. EPA 
approved NAC section 445B.22083 into the Nevada SIP (69 FR 54006, 
54019 (September 7, 2004)), thereby resolving the regulatory gap 
that would otherwise currently exist in connection with NSR for 
PM10 sources under NDEP jurisdiction within the Las Vegas 
planning area.
---------------------------------------------------------------------------

III. Public Comment and Proposed Action

    Pursuant to section 110(k) of the CAA and for the reasons provided 
above, EPA is proposing a limited approval and limited disapproval of 
revisions to the Clark County portion of the Nevada SIP that govern the 
issuance of permits for stationary sources under the jurisdiction of 
the Clark County Department of Air Quality, including review and 
permitting of major sources and major modifications under parts C and D 
of title I of the CAA. Specifically, EPA is proposing a limited 
approval and limited disapproval of the new and amended Clark County 
regulations listed in table 1, above, as a revision to the Clark County 
portion of the Nevada SIP.
    EPA is proposing this action because, although we find that the new 
and amended rules meet most of the applicable requirements for such 
permit programs and that the SIP revisions improve the existing SIP, we 
have found certain deficiencies that prevent full approval, as 
explained further in this preamble and in the TSD for this rulemaking. 
The intended effect of this proposed limited approval and limited 
disapproval action is to update the applicable SIP with current Clark 
County permitting regulations \8\ and to set the stage for remedying 
deficiencies in these regulations.
---------------------------------------------------------------------------

    \8\ Final approval of the rules in table 1 would supersede all 
but two of the rules in the existing Nevada SIP as listed in table 
2. The two SIP rules that will remain in the SIP and are unaffected 
by today's proposed action are Section 11 and NAC 445B.22083.
---------------------------------------------------------------------------

    If finalized as proposed, this limited approval action would 
trigger an obligation on EPA to promulgate a Federal Implementation 
Plan unless the State of Nevada corrects the deficiencies, and EPA 
approves the related plan revisions, within two years of the final 
action. Additionally, for those deficiencies that relate to the 
Nonattainment NSR requirements under part D of title I of the Act, the 
offset sanction in CAA section 179(b)(2) would apply in the Clark 
County nonattainment areas 18 months after the effective date of a 
final limited disapproval, and the highway funding sanctions in CAA 
section 179(b)(1) would apply in these areas six months after the 
offset sanction is imposed. Neither sanction will be imposed under the 
CAA if Nevada submits and we approve prior to the implementation of the 
sanctions, SIP revisions that correct the deficiencies that we identify 
in our final action.
    We will accept comments from the public on this proposed limited 
approval and limited disapproval for the next 30 days.

IV. Statutory and Executive Order Reviews

A. Executive Order 12866, Regulatory Planning and Review

    This proposed action is not a ``significant regulatory action'' 
under the terms of Executive Order (EO) 12866 (58 FR 51735, October 4, 
1993) and is therefore not subject to review under the EO.

B. Paperwork Reduction Act

    This proposed action does not impose an information collection 
burden under the provisions of the Paperwork Reduction Act, 44 U.S.C. 
3501 et seq, because this proposed limited approval/disapproval under 
section 110 and subchapter I, part D of the Clean Air Act will not in-
and-of itself create any new information collection burdens but simply 
disapproves certain State requirements for inclusion into the SIP. 
Burden is defined at 5 CFR 1320.3(b).

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to conduct a regulatory flexibility analysis of any

[[Page 43215]]

rule subject to notice and comment rulemaking requirements unless the 
agency certifies that the rule will not have a significant economic 
impact on a substantial number of small entities. Small entities 
include small businesses, small not-for-profit enterprises, and small 
governmental jurisdictions. For purposes of assessing the impacts of 
today's proposed rule on small entities, small entity is defined as: 
(1) A small business as defined by the Small Business Administration's 
(SBA) regulations at 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; and 
(3) a small organization that is any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field.
    After considering the economic impacts of today's proposed rule on 
small entities, I certify that this action will not have a significant 
impact on a substantial number of small entities. This rule does not 
impose any requirements or create impacts on small entities. This 
proposed limited approval/disapproval under section 110 and subchapter 
I, part D of the Clean Air Act will not in-and-of itself create any new 
requirements but simply disapproves certain State requirements for 
inclusion into the SIP. Accordingly, it affords no opportunity for EPA 
to fashion for small entities less burdensome compliance or reporting 
requirements or timetables or exemptions from all or part of the rule. 
The fact that the Clean Air Act prescribes that various consequences 
(e.g., higher offset requirements) may or will flow from this proposed 
limited disapproval does not mean that EPA either can or must conduct a 
regulatory flexibility analysis for this action. Therefore, this action 
will not have a significant economic impact on a substantial number of 
small entities.
    We continue to be interested in the potential impacts of this 
proposed rule on small entities and welcome comments on issues related 
to such impacts.

D. Unfunded Mandates Reform Act

    This action contains no Federal mandates under the provisions of 
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 
1531-1538 for State, local, or tribal governments or the private 
sector. EPA has determined that the proposed limited disapproval action 
does not include a Federal mandate that may result in estimated costs 
of $100 million or more to either State, local, or tribal governments 
in the aggregate, or to the private sector. This action proposes to 
disapprove pre-existing requirements under State or local law, and 
imposes no new requirements. Accordingly, no additional costs to State, 
local, or tribal governments, or to the private sector, result from 
this action.

E. Executive Order 13132, Federalism

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August 
10, 1999), requires EPA to develop an accountable process to ensure 
``meaningful and timely input by State and local officials in the 
development of regulatory policies that have federalism implications.'' 
``Policies that have federalism implications'' is defined in the 
Executive Order to include regulations that have ``substantial direct 
effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government.''
    This proposed action 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, because it merely disapproves 
certain State requirements for inclusion into the SIP and does not 
alter the relationship or the distribution of power and 
responsibilities established in the Clean Air Act. Thus, Executive 
Order 13132 does not apply to this proposed action.

F. Executive Order 13175, Coordination With Indian Tribal Governments

    This proposed action does not have tribal implications, as 
specified in Executive Order 13175 (65 FR 67249, November 9, 2000), 
because the SIP EPA is proposing to disapprove would not apply in 
Indian country located in the state, and EPA notes that it will not 
impose substantial direct costs on tribal governments or preempt tribal 
law. Thus, Executive Order 13175 does not apply to this proposed 
action.

G. Executive Order 13045, Protection of Children From Environmental 
Health Risks and Safety Risks

    EPA interprets E.O. 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 E.O. has the 
potential to influence the regulation. This proposed action is not 
subject to EO 13045 because it is not an economically significant 
regulatory action based on health or safety risks subject to Executive 
Order 13045 (62 FR 19885, April 23, 1997). This proposed limited 
approval and disapproval under section 110 and subchapter I, part D of 
the Clean Air Act will not in-and-of itself create any new regulations 
but simply disapproves certain State requirements for inclusion into 
the SIP.

H. Executive Order 13211, Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This proposed rule is not subject to Executive Order 13211 (66 FR 
28355, May 22, 2001) because it is not a significant regulatory action 
under Executive Order 12866.

I. National Technology Transfer and Advancement Act

    Section 12(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 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. NTTAA directs EPA to provide 
Congress, through OMB, explanations when the Agency decides not to use 
available and applicable voluntary consensus standards.
    The EPA believes that this action is not subject to requirements of 
Section 12(d) of NTTAA because application of those requirements would 
be inconsistent with the Clean Air Act.

J. Executive Order 12898: Federal Actions to Address Environmental 
Justice in Minority Populations and Low-Income Population

    Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes 
federal executive policy on environmental justice. Its main provision 
directs federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States.
    EPA lacks the discretionary authority to address environmental 
justice in this rulemaking.

[[Page 43216]]

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Intergovernmental 
relations, Nitrogen dioxide, Ozone, Reporting and recordkeeping 
requirements, Volatile organic compounds.

    Authority:  42 U.S.C. 7401 et seq.

    Dated: July 13, 2012.
Jared Blumenfeld,
Regional Administrator, Region IX.
[FR Doc. 2012-18077 Filed 7-23-12; 8:45 am]
BILLING CODE 6560-50-P