Revisions to Air Plan; Arizona; Stationary Sources; New Source Review, 14044-14062 [2015-06143]
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Federal Register / Vol. 80, No. 52 / Wednesday, March 18, 2015 / Proposed Rules
List of Subjects in 40 CFR Part 52
Environmental protection, Air
pollution control, Intergovernmental
relations, Incorporation by reference,
Ozone, Reporting and recordkeeping
requirements.
Authority: 42 U.S.C. 7401 et seq.
Dated: March 6, 2015.
William C. Early,
Acting Regional Administrator, Region III.
[FR Doc. 2015–06220 Filed 3–17–15; 8:45 am]
BILLING CODE 6560–50–P
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR part 52
[EPA–R09–OAR–2015–0187; FRL–9924–48–
Region 9]
Revisions to Air Plan; Arizona;
Stationary Sources; New Source
Review
Environmental Protection
Agency (EPA).
ACTION: Proposed rule.
AGENCY:
The Environmental Protection
Agency (EPA) is proposing a limited
approval and limited disapproval of
revisions to the Arizona Department of
Environmental Quality (ADEQ) portion
of the applicable state implementation
plan (SIP) for the State of Arizona.
These revisions are primarily intended
to serve as a replacement of ADEQ’s
existing SIP-approved rules for the
issuance of New Source Review (NSR)
permits for stationary sources, including
but not limited to review and permitting
of major sources and major
modifications under the Clean Air Act
(CAA or Act). After a lengthy
stakeholder process, the State of
Arizona developed and submitted a
NSR program for SIP approval that
satisfies most of the applicable Clean
Air Act and NSR regulatory
requirements, and will significantly
update ADEQ’s existing SIP-approved
NSR program. It also represents an
overall strengthening of ADEQ’s SIPapproved NSR program by clarifying
and enhancing the NSR permitting
requirements for major and minor
stationary sources. This proposed action
will update the applicable plan and set
the stage for remedying certain
deficiencies in these rules. We are
seeking comment on our proposed
action and plan to follow with a final
action.
DATES: Any comments must arrive by
April 17, 2015.
ADDRESSES: Submit comments,
identified by docket number EPA–R09–
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SUMMARY:
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OAR–2015–0187, by one of the
following methods:
1. Federal eRulemaking Portal:
www.regulations.gov. Follow the online
instructions.
2. Email: R9airpermits@epa.gov.
3. Mail or deliver: Gerardo Rios (Air3), U.S. Environmental Protection
Agency, Region 9, 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.
Electronic files should avoid the use of
special characters, any form of
encryption, and be free of any defects or
viruses.
Docket: Generally, documents in the
docket for this action are available
electronically at www.regulations.gov
and in hard copy at EPA Region 9, 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: Lisa
Beckham, EPA Region 9, (415) 972–
3811, beckham.lisa@epa.gov.
SUPPLEMENTARY INFORMATION:
Throughout this document, the terms
‘‘we,’’ ‘‘us,’’ and ‘‘our’’ refer to EPA.
Table of Contents
I. The State’s Submittals
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A. Which rules or statutory provisions did
the State submit?
B. Are there previous versions of the
statutory provisions or rules in the
Arizona SIP?
C. What is the purpose of this proposed
rule?
II. EPA’s Evaluation
A. How is EPA evaluating the rules and
statutory provisions?
B. Do the rules meet the evaluation criteria
for Minor New Source Review?
1. Legally Enforceable Procedures
2. ADEQ’s Program Under 40 CFR
51.160(e)
3. Public Availability of Information
4. Administrative Procedures
5. Stack Height Procedures
C. Do the rules meet the evaluation criteria
for Prevention of Significant
Deterioration (PSD)?
1. General PSD Program Requirements
2. Restrictions on Area Classifications
3. Redesignations
4. Impacts on Class I Areas
5. Public Participation
6. Plantwide Applicability Limits
7. Definitions
8. PM2.5 Significant Monitoring
Concentration
9. Definition for Basic Design Parameter
D. Do the rules meet the evaluation criteria
for Nonattainment New Source Review?
1. General Nonattainment NSR Program
Requirements
2. Plantwide Applicability Limits
3. Definitions
4. Definition for Basic Design Parameter
5. Additional Provisions for Particulate
Matter Nonattainment Areas
E. Review of Non-NSR Related Rules and
Statutory Provisions
F. Review of Rules and Statutory
Provisions Requested To Be Removed
From the SIP
G. Do the rules meet the evaluation criteria
under Sections 110(l) and 193 of the Act?
H. Conclusion
III. Public Comment and Proposed Action
IV. Incorporation by Reference
V. Statutory and Executive Order Reviews
Definitions
For the purpose of this document, we
are giving meaning to certain words or
initials as follows:
(i) The words or initials Act or CAA mean
or refer to the Clean Air Act, unless the
context indicates otherwise.
(ii) The initials ADEQ mean or refer to the
Arizona Department of Environmental
Quality.
(iii) The initials A.R.S. mean or refer to the
Arizona Revised Statutes.
(iv) The initials BACT mean or refer to Best
Available Control Technology.
(v) The initials CFR mean or refer to Code
of Federal Regulations.
(vi) The initials CO means or refer to
carbon monoxide.
(vii) The words EPA, we, us or our mean
or refer to the United States Environmental
Protection Agency.
(viii) The initials FIP mean or refer to
Federal Implementation Plan.
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(ix) The initials GHG mean or refer to
greenhouse gas.
(x) The initials IBR mean or refer to
incorporation by reference.
(xi) The initials LAER mean or refer to
Lowest Achievable Emissions Rate.
(xii) The initials NAAQS mean or refer to
National Ambient Air Quality Standards.
(xiii) The initials NA–NSR mean or refer to
Nonattainment New Source Review.
(xiv) The initials NOX mean or refer to
nitrogen oxides.
(xv) The initials NSR mean or refer to New
Source Review.
(xvi) The initials PAL mean or refer to
Plantwide Applicability Limits.
(xvii) The initials PM10 mean or refer to
particulate matter with an aerodynamic
diameter of less than or equal to 10
micrometers (coarse particulate matter).
(xviii) The initials PM2.5 mean or refer to
particulate matter with an aerodynamic
diameter of less than or equal to 2.5
micrometers (fine particulate matter).
(xix) The initials PSD mean or refer to
Prevention of Significant Deterioration.
(xx) The initials PTE mean or refer to
potential to emit.
(xxi) The initials RACT mean or refer to
reasonable available control technology.
(xxii) The initials SIP mean or refer to State
Implementation Plan.
(xxiii) The initials SMC mean or refer to
significant monitoring concentration.
(xxiv) The initials SO2 mean or refer to
sulfur dioxide.
(xxv) The words State or Arizona mean the
State of Arizona, unless the context indicates
otherwise.
(xxvi) The initials TSD mean or refer to the
technical support document for this action.
(xxvii) The initials VOC mean or refer to
volatile organic compound.
I. The State’s Submittals
A. Which rules or statutory provisions
did the State submit?
On July 28, 2011 and October 29,
2012, ADEQ submitted revisions to the
ADEQ portion of the Arizona SIP. On
May 16, 2014, ADEQ supplemented the
July 28, 2011 submittal. On September
6, 2013, July 2, 2014, and February 16,
2015, ADEQ supplemented the October
29, 2012 submittal. Collectively, these
submittals generally comprise ADEQ’s
current program for preconstruction
review and permitting of new or
modified stationary sources under
ADEQ’s jurisdiction in Arizona (as
described below).1 The NSR SIP
revisions that are the subject of this
action, 2 referred to herein as the ‘‘NSR
SIP submittal’’ represent a
comprehensive revision to ADEQ’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 under section
110(a)(2)(C) of the Act.3 The
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preconstruction review and permitting
programs are often collectively referred
to as ‘‘New Source Review’’ (NSR).
The proposed revisions to the SIP that
are subject to this action cover those
areas of Arizona where ADEQ has
jurisdiction. Currently, ADEQ has
permitting jurisdiction for the following
stationary source categories in all areas
of Arizona: Smelting of metal ores, coalfired electric generating stations,
petroleum refineries, Portland cement
plants, and portable sources. ADEQ also
has permitting jurisdiction for major
and minor sources in the following
counties: Apache, Cochise, Coconino,
Gila, Graham, Greenlee, La Paz,
Mohave, Navajo, Santa Cruz, Yavapai,
and Yuma. Finally, ADEQ has
permitting jurisdiction over major
sources in Pinal County 4 and the
Rosemont Copper Mine in Pima County.
Table 1 lists the rules we are
proposing for approval in today’s action
with the corresponding effective dates
and submittal dates. The submitted
rules are from the Arizona
Administrative Code, Title 18—
Environmental Quality, Chapter 2—
Department of Environmental Quality—
Air Pollution Control, Articles 1, 2, 3,
and 4. The submitted statutory
provision is from Title 49 of the Arizona
Revised Statutes, Chapter 1, Article 1.
TABLE 1—SUBMITTED STATUTES AND RULES PROPOSED FOR APPROVAL IN THIS ACTION
State
effective
date
Rule or statute
Title
A.R.S § 49–107 ...........................................................
R18–2–101 [only definitions (2), (32), (87), (109),
and (122)].
R18–2–217 ..................................................................
R18–2–218 ..................................................................
Local delegation of state authority ............................
Definitions ..................................................................
08/18/1987
08/07/2012
07/2/2014
10/29/2014
Designation and Classification of Attainment Areas
Limitation of Pollutants in Classified Attainment
Areas.
Definitions ..................................................................
Applicability; Registration; Classes of Permits ..........
Source Registration Requirements ............................
Transition from Installation and Operating Permit
Program to Unitary Permit Program; Registration
transition; Minor NSR transition.
Permit Application Processing Procedures ...............
Permit Contents .........................................................
Permits Containing Voluntarily Accepted Emission
Limitations and Standards.
Establishment of an Emissions Cap ..........................
Test Methods and Procedures ..................................
11/15/1993
08/07/2012
10/29/2014
10/29/2014
08/07/2012
08/07/2012
08/07/2012
08/07/2012
10/29/2014
10/29/2014
10/29/2014
10/29/2014
08/07/2012
12/20/1999
01/01/2007
10/29/2014
10/29/2014
10/29/2014
09/22/1999
11/15/1993
10/29/2014
07/28/2011
R18–2–301 ..................................................................
R18–2–302 ..................................................................
R18–2–302.01 .............................................................
R18–2–303 ..................................................................
R18–2–304 ..................................................................
R18–2–306 ..................................................................
R18–2–306.01 .............................................................
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R18–2–306.02 .............................................................
R18–2–311 ..................................................................
1 In addition, these submittals and our current
action also address two rules and one statutory
provision that are not directly related to NSR.
2 We note that portions of ADEQ’s SIP-approved
rule R18–2–310, which provides affirmative
defenses for excess emissions during malfunctions
(R18–2–310(B)) and for excess emissions during
startup or shutdown (R18–2–310(C)), are currently
the subject of a separate rulemaking action by EPA.
In a 2013 notice of proposed rulemaking, and a
2014 supplemental notice of proposed rulemaking
that revised certain of the findings described in the
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2013 notice, EPA proposed to find R18–2–310(B)
and R18–2–310(C) substantially inadequate to meet
CAA requirements and proposed to issue a SIP call
with respect to these provisions. See 78 FR 12460,
12533–34, Feb. 22, 2013; 79 FR 55920, 55946–47,
Sept. 17, 2014. ADEQ’s R18–2–310 is not part of the
ADEQ SIP submittal that is under consideration in
this action, and this rule is not being evaluated or
otherwise addressed by EPA as part of our current
action on ADEQ’s SIP submittal.
3 Rules R18–2–301 through R18–2–334 (Article 3
rules) also contain requirements to address the CAA
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Submitted
title V requirements for operating permit programs,
but we are not evaluating these rules for title V
purposes at this time. We will evaluate the Article
3 rules 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 revision submittal from ADEQ.
4 ADEQ has delegated implementation of the
major source program to the Pinal County Air
Quality Control District.
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TABLE 1—SUBMITTED STATUTES AND RULES PROPOSED FOR APPROVAL IN THIS ACTION—Continued
Rule or statute
R18–2–312
R18–2–315
R18–2–316
R18–2–319
R18–2–320
R18–2–321
R18–2–323
R18–2–330
R18–2–332
R18–2–334
R18–2–401
R18–2–402
R18–2–403
State
effective
date
Title
..................................................................
..................................................................
..................................................................
..................................................................
..................................................................
..................................................................
..................................................................
..................................................................
..................................................................
..................................................................
[excluding definition (3)] ..........................
..................................................................
..................................................................
R18–2–404 ..................................................................
R18–2–405 ..................................................................
R18–2–406 ..................................................................
R18–2–407 [excluding subsection (H)(1)(c)] ..............
R18–2–409 ..................................................................
R18–2–412 ..................................................................
On December 28, 2012, April 29,
2013, and December 2, 2014, ADEQ’s
July 28, 2011, October 29, 2012, and
July 2, 2014 submittals, respectively,
were deemed complete by operation of
law to meet the completeness criteria in
40 CFR part 51, appendix V, which
must be met before formal EPA review.
Each of these submittals includes
evidence of public notice and adoption
of the regulation. Our technical support
document (TSD) provides additional
background information on each of the
submitted rules.
Performance Tests ....................................................
Posting of Permit .......................................................
Notice by Building Permit Agencies ..........................
Minor Permit Revisions ..............................................
Significant Permit Revisions ......................................
Permit Reopenings; Revocation and Reissuance .....
Permit Transfers ........................................................
Public Participation ....................................................
Stack Height Limitation ..............................................
Minor New Source Review ........................................
Definitions ..................................................................
General ......................................................................
Permits for Sources Located in Nonattainment
Areas.
Offset Standards ........................................................
Special Rule for Major Sources of VOC or Nitrogen
Oxides in Ozone Nonattainment Areas Classified
as Serious or Severe.
Permit Requirements for Sources Located in Attainment and Unclassifiable Areas.
Air Quality Impact Analysis and Monitoring Requirements.
Air Quality Models .....................................................
PALs ..........................................................................
B. Are there previous versions of the
statutory provisions or rules in the
Arizona SIP?
EPA has not approved significant
revisions or updates to ADEQ’s SIPapproved NSR program since the 1980s.
The existing SIP-approved NSR program
for new or modified stationary sources
under ADEQ’s jurisdiction generally
consists of the rules identified below in
Table 2 that we are proposing to
supersede in or delete from the Arizona
SIP. Collectively, these regulations
established the NSR requirements for
both major and minor stationary sources
under ADEQ jurisdiction in Arizona,
including requirements for the
generation and use of emission
Submitted
11/15/1993
11/15/1993
05/14/1979
08/07/2012
08/07/2012
08/07/2012
02/03/2007
08/07/2012
11/15/1993
08/07/2012
08/07/2012
08/07/2012
08/07/2012
07/28/2011
10/29/2014
10/29/2014
10/29/2014
10/29/2014
10/29/2014
10/29/2014
10/29/2014
10/29/2014
10/29/2014
10/29/2014
10/29/2014
10/29/2014
08/07/2012
08/07/2012
10/29/2014
10/29/2014
08/07/2012
10/29/2014
08/07/2012
10/29/2014
11/15/1993
08/07/2012
10/29/2014
10/29/2014
reduction credits in nonattainment
areas.
Consistent with ADEQ’s stated intent
to have the submitted NSR rules replace
the existing NSR program in the SIP,
EPA’s approval of the regulations
identified above in Table 1 generally
would have the effect of superseding
our prior approval of the current SIPapproved NSR program.5 Table 2 lists
the existing rules in the Arizona SIP that
would be superseded or removed from
the Arizona SIP as a result of our
proposed action. If EPA were to take
final action as proposed herein, these
rules generally would be replaced in, or
otherwise deleted from, the SIP by the
submitted set of rules listed in Table 1.
TABLE 2—SIP RULES SUPERSEDED OR REMOVED FROM ARIZONA SIP IN THIS ACTION
EPA Approval
date
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Rule or statute
Title
R9–3–101 ....................................................................
R9–3–217(B) ...............................................................
R9–3–301, [excluding subsections (I), (K)] .................
R9–3–302 ....................................................................
R9–3–303 ....................................................................
R9–3–304, [excluding subsection (H)] ........................
R9–3–305 ....................................................................
R9–3–306 ....................................................................
R9–3–307 ....................................................................
R9–3–308 ....................................................................
R9–3–311 ....................................................................
R9–3–314 ....................................................................
R9–3–315 ....................................................................
Definitions ..................................................................
Attainment Areas: Classification and Standards .......
Installation Permits: General .....................................
Installation Permits in Nonattainment Areas .............
Offset Standards ........................................................
Installation Permits in Attainment Areas ...................
Air Quality Analysis and Monitoring Requirements ...
Source Registration Requirements ............................
Replacement ..............................................................
Permit Conditions ......................................................
Air Quality Models .....................................................
Excess Emissions Reporting .....................................
Posting of Permits .....................................................
5 Except for certain sections that ADEQ requested
that we not remove from the SIP at this time.
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Various
04/23/1982
05/03/1983
08/10/1988
08/10/1988
05/03/1983
05/03/1983
05/03/1983
05/05/1982
04/23/1982
04/23/1982
04/23/1982
04/23/1982
Federal
Register
citation
Various
47 FR 17486
48 FR 198879
53 FR 30220
53 FR 30220
48 FR 19879
48 FR 19879
48 FR 19879
47 FR 19328
47 FR 17485
47 FR 17485
47 FR 17485
47 FR 17485
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TABLE 2—SIP RULES SUPERSEDED OR REMOVED FROM ARIZONA SIP IN THIS ACTION—Continued
EPA Approval
date
Rule or statute
Title
R9–3–316 ....................................................................
R9–3–317 ....................................................................
R9–3–318 ....................................................................
Notice by Building Permit Agencies ..........................
Permit Non-transferrable; Exception .........................
Denial or Revocation of Installation or Operating
Permit.
Permit Fees ...............................................................
Temporary Conditional Permits .................................
Jurisdiction .................................................................
Fee Schedule for Installation and Operating Permits
Fee Schedule for Conditional Permits .......................
R8–3–319 ....................................................................
R9–3–322 ....................................................................
R9–3–1101 ..................................................................
Appendix 4 ..................................................................
Appendix 5 ..................................................................
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 rules and
statutory provisions submitted by ADEQ
on July 28, 2011, October 29, 2012, and
July 2, 2014, which are identified in
Table 1. We provide our reasoning in
general terms below, and include our
more detailed analysis in the TSD,
which is available in the docket for this
proposed rulemaking.
II. EPA’s Evaluation
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A. How is EPA evaluating the rules and
statutory provisions?
EPA has reviewed the provisions
submitted by ADEQ that are the subject
of this action, including those governing
NSR for stationary sources under ADEQ
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 51.166, and the
CAA requirements for SIP revisions in
CAA section 110(l) and 193.6
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
6 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. CAA section 193, which
was added by the CAA Amendments of 1990,
includes a savings clause that provides, in pertinent
part: ‘‘No control requirement in effect, or required
to be adopted by an order, settlement agreement, or
plan in effect before November 15, 1990, in any area
which is a nonattainment area for any air pollutant
may be modified after November 15, 1990, in any
manner unless the modification insures equivalent
or greater emission reductions of such air
pollutant.’’
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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
July 28, 2011, October 29, 2012 and July
2, 2014 submittals, we find that ADEQ
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 generally
reviewed the ADEQ provisions that are
the subject of our current action in
accordance with the CAA and
applicable regulatory requirements,
focusing primarily on those that apply
to: (1) General preconstruction review
programs, including 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 (NA–NSR). For the most
part, ADEQ’s submittal satisfies
applicable CAA requirements,
specifically including the applicable
requirements for these three
preconstruction review programs and
would strengthen the applicable SIP by
updating the regulations and adding
requirements to address new or revised
NSR permitting and other requirements
promulgated by EPA, but the submitted
rules also contain specific deficiencies
that prevent full approval. Below, we
discuss generally our evaluation of
ADEQ’s submittal and the deficiencies
that are the basis for our proposed
action on these rules. Our TSD contains
a more detailed evaluation as well as
additional recommendations for
program improvements.
B. Do the rules meet the evaluation
criteria for Minor New Source Review?
Section 110(a)(2)(C) requires each SIP
to include a program for the regulation
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Federal
Register
citation
04/23/1982
04/23/1982
04/23/1982
47 FR 17485
47 FR 17485
47 FR 17485
04/23/1982
10/19/1984
05/03/1983
09/19/1977
09/19/1977
47
49
48
42
42
FR
FR
FR
FR
FR
17485
41026
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of the modification and construction of
any stationary source within the areas
covered by the plan as necessary to
assure attainment and maintenance of
the National Ambient Air Quality
Standards (NAAQS). In addition to the
permit programs required under parts C
and D of the CAA for PSD sources and
nonattainment NSR sources,
respectively, which are discussed
below, EPA’s regulations at 40 CFR
51.160–51.164 provide general
programmatic requirements to
implement this statutory mandate
commonly referred to as the ‘‘minor
NSR program.’’ These minor NSR
program regulations impose
requirements for SIP approval of State
and local programs that are more
general in nature as compared with the
specific statutory and regulatory
requirements for PSD and NA–NSR
permitting programs. Under EPA’s
regulations governing the minor NSR
program, States and local air agencies
retain a level of discretion to define the
types and sizes of sources subject to the
program, whereas under the PSD and
nonattainment NSR permitting
programs, the sources subject to
regulation are specified by EPA
regulations. The substantive
requirements for the preconstruction
review and permitting of minor
stationary sources under ADEQ
jurisdiction are ADEQ rules R18–2–
302.01 and R18–2–334. These rules, and
other administrative rules included in
the minor NSR portion of the SIP
submittal, satisfy most of the statutory
and regulatory requirements for minor
NSR programs, but these rules also
contain several deficiencies that form
the basis for our proposed limited
disapproval, as discussed below.
We are proposing a limited approval
and limited disapproval of ADEQ’s
minor NSR program because it is not
fully consistent with the requirements
of 40 CFR 51.160, 40 CFR 51.161, 40
CFR 51.163 and 40 CFR 51.164, as
described below. We find that approval
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of ADEQ’s updated minor NSR program
will substantially strengthen the SIP
overall, as the submitted minor NSR
program generally has more extensive
requirements for minor sources and
non-major modifications than ADEQ’s
current SIP-approved program and
lower permitting thresholds that will
provide additional mechanisms for
protecting the NAAQS, as well as
updating the SIP with current State
regulations for minor sources and nonmajor modifications. However, specific
provisions of the minor NSR program
submittal are inconsistent with federal
minor NSR program requirements, and
these deficiencies must be addressed
before we can fully approve ADEQ’s
minor NSR program into the SIP. The
deficiencies that we have identified
with ADEQ’s minor NSR program that
provide the basis for our limited
approval and limited disapproval are
described below.
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1. Legally Enforceable Procedures
40 CFR 51.160 requires that each NSR
program contain certain legally
enforceable procedures. We have
identified several deficiencies with
ADEQ’s program as it pertains to these
requirements.
First, as required by 40 CFR 51.160(a),
ADEQ’s permitting procedures are not
enforceable in all instances. ADEQ’s
program allows certain sources to begin
construction when a ‘‘proposed final
permit’’ is issued by ADEQ, rather than
preventing construction until a final
permit has been issued. See R18–2–
101(114), R18–2–302(G), R18–2–334(B),
R18–2–402(C). The definition for
‘‘proposed final permit’’ in R18–2–101
does not specify that such an action is
a final decision for NSR purposes. As a
result, the program does not provide
ADEQ with clear authority to prevent
construction or modification before it
issues a final decision on the request for
authority to construct as is required per
40 CFR 51.160(a) and (b). ADEQ has
clarified that, in effect, under ADEQ’s
rules, a proposed final permit is treated
as a final authorization to construct, and
that it will treat proposed final permit
as a final, appealable agency action
under Arizona law.7 Nevertheless, a
revision to ADEQ’s NSR program is
necessary to ensure that these types of
permit actions clearly serve as a final
authority to construct in order to satisfy
the federal NSR program requirement
that the agency be able to prevent
construction until and unless it has
7 ADEQ Memo—Proposed Final Permits to be
Treated as Appealable Agency Actions, dated
February 10, 2015 and ADEQ’s February 23, 20157
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issued a final decision on the request for
authority to construct.
Second, ADEQ’s program does not
contain adequate enforceable
procedures to ensure compliance by
sources subject to review under its NSR
program with the NAAQS as required
by 40 CFR 51.160(a)(2) and (b)(2).
Although NAAQS is a defined term in
ADEQ’s regulations, see R18–2–101(85),
ADEQ’s NSR program generally does
not refer to the NAAQS and instead
generally references the State’s ambient
air standards in Article 2 of ADEQ’s air
program. See R18–2–302.01, R18–2–
334, and R18–2–406.8 Also, in some
instances, ADEQ’s NSR regulations
simply refer to Arizona ambient air
quality standards with no specific
reference to Article 2, which makes the
applicable standards ambiguous.9 See
R18–2–218, R18–2–406, and R18–2–
407. In some instances, ADEQ’s NSR
program does not ensure that a source
would not interfere with attainment or
maintenance of the NAAQS in
neighboring areas outside ADEQ’s
permitting jurisdiction, as is required
under 40 CFR 51.160(a) and (b), as the
State air standards are not generally
applicable in neighboring States,10 and
the NSR Program submittal does not
demonstrate that they are applicable in
neighboring States for purposes of
ADEQ’s NSR program. See R18–2–
302.01(C); R18–2–334(C)(2), (F), and (G);
and R18–2–406(A)(5)(a) and (b). Also,
for minor sources subject to permitting
under R18–2–334, the rule does not
meet these federal requirements as it
does not require ADEQ to evaluate
whether the project under review will
interfere with attainment or
maintenance of the NAAQS in all cases,
and instead allows sources to apply
reasonably available control technology
(RACT) in lieu of such an evaluation
and, in some cases, appears to allow
sources with lower levels of emissions
to avoid both substantive NAAQS
review and RACT requirements. See
8 ADEQ’s list of state air standards does not
contain the current PM2.5 annual NAAQS of 12 m g/
m3 PM2.5. See 78 FR 3086, Jan. 13, 2013. This is
not a disapproval issue for ADEQ’s minor NSR and
NA–NSR programs, which have three years to adopt
programs implementing the new NAAQS. However,
the new NAAQS is applied immediately upon its
effective date to sources subject to the PSD program.
9 For example, R18–2–407(B) contains ‘‘any such
pollutant for which no Arizona ambient air quality
standard exists.’’ ‘‘Arizona ambient air quality
standard’’ is not a defined term in ADEQ’s
regulations.
10 See, for example, the definition of ‘‘attainment
area’’ in R18–2–101, limiting attainment areas to
those in Arizona. A.R.S. § 49–106 provides, in
relevant part: ‘‘The rules adopted by the department
apply and shall be observed throughout this state,
or as provided by their terms, and the appropriate
local officer, council or board shall enforce them.’’
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R18–2–334(C)(1)(a)–(b). ADEQ has not
demonstrated that this approach ensures
that all sources subject to review under
its NSR program will not interfere with
attainment or maintenance of the
NAAQS. While R18–2–334(G) allows
Director’s discretion to require a
NAAQS analysis on a case-by-case
basis, we find this discretion too great
to ensure compliance with this
requirement. Finally, R18–2–
302.01(C)(4) needs to include a
reference to ‘‘or maintenance’’ of a
standard, instead of just ‘‘attainment of
a standard.’’
Third, for sources subject to ADEQ’s
registration program at R18–2–302.01,
ADEQ has not demonstrated that its
NSR program meets the requirement to
ensure that sources subject to NSR
review comply with the applicable
portions of the control strategy as
required by 40 CFR 51.160(b)(1).
Fourth, ADEQ’s registration program
in R18–2–302.01 does not contain
enforceable procedures for the owner or
operator to submit the necessary
information for ADEQ to determine
whether a source will violate the
applicable control strategy or interfere
with attainment or maintenance of the
NAAQS as required by 40 CFR
51.160(c). R18–2–302.01(A)(3) requires
applicants to calculate a source’s
uncontrolled potential to emit, but then
references provisions in another rule,
R18–2–327(C), that are used to calculate
‘‘actual’’ emissions. As such, ADEQ’s
program contains conflicting procedures
for calculating potential emissions. In
addition, rule R18–2–327, is not in the
Arizona SIP, and has not been
submitted to EPA for SIP approval.
Fifth, ADEQ’s program does not meet
the requirement that the applicant
submit information related to the nature
and amounts of emissions, for certain
kinds of emissions units as required by
40 CFR 51.160(c)(1). For Class I and
Class II permits, R18–2–304(E)(9) allows
sources to avoid providing emission
information for ‘‘insignificant
activities,’’ as defined in R18–2–101(68).
The term ‘‘insignificant activities’’ is
generally associated with the title V
program. Many of the activities listed in
ADEQ’s definition of insignificant
activity are activities that would not be
expected to emit regulated NSR
pollutants. However, this is not true for
all activities, such as those listed under
R18–2–101(68)(a–c) that include liquid
storage tanks, combustion engines, and
‘‘low-emitting processes.’’
Sixth, for sources subject to R18–2–
302.01, ADEQ’s program does not meet
the requirement in 40 CFR 51.160(d)
that its procedures provide that
approval of construction or modification
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will not affect the responsibility of the
owner or operator to comply with
applicable portions of the control
strategy.
Finally, for sources subject to ADEQ’s
registration program under R18–2–
302.01, ADEQ’s program does not meet
the requirement to use Appendix W to
40 CFR part 51 for air quality modeling
as required by 40 CFR 51.160(f)(1).
2. ADEQ’s Program Under 40 CFR
51.160(e)
40 CFR 51.160(e) requires ADEQ’s
submittal to provide a basis for the types
and sizes of facilities, buildings,
structures, or installations that will be
subject to review under 40 CFR 51.160.
Such exclusions are appropriate so long
as such sources and modifications are
not environmentally significant,
consistent with the de minimis
exemption criteria set forth in Ala.
Power Co. v. Costle, 636 F.2d 323, at
360–361 (D.C. Cir. 1979). Here, we
discuss our evaluation of the basis
provided by ADEQ for the types and
sizes of facilities, buildings, structures
or installations it will subject to review
under its minor NSR program.
Historically, ADEQ’s minor NSR
program required permitting of minor
sources and non-major modifications
causing an increase in potential
emissions of a criteria pollutant at or
above the significant emission rates
under the PSD program in 40 CFR
51.166(b)(23)(i). In a May 22, 1996 letter
to ADEQ, EPA Region 9 indicated that
the significant emission rates used by
ADEQ for its minor NSR permitting
program did not represent an acceptable
threshold for applying the basic
preconstruction requirements for minor
NSR purposes. To address EPA’s
concerns, ADEQ assessed other
potential permitting thresholds for its
minor NSR program and selected
revised thresholds for its minor NSR
program following this assessment. A
detailed analysis of ADEQ’s assessment
is provided in our TSD. ADEQ’s new
minor NSR program established a
minimum preconstruction review
threshold for new or modified stationary
sources with potential emissions or
emissions increases of: 50 tons per year
(tpy) of carbon monoxide; 20 tpy of
NOX, SO2, and VOC; 7.5 tpy for PM10;
5 tpy for PM2.5; and 0.3 tpy for lead. We
find ADEQ’s general approach to
meeting 40 CFR 51.160(e) acceptable.
We are proposing a limited disapproval
of ADEQ’s minor NSR program based in
part on the following issues concerning
the approach:
First, ADEQ’s submittal does not
provide a clear basis for concluding that
the exemption thresholds selected by
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ADEQ will ensure a sufficient
percentage of minor sources are subject
to review in nonattainment areas. As
ADEQ points out in its submittal,
ADEQ’s analysis is based on data for
Maricopa County 11, which has lower
NSR permitting thresholds than the
exemption thresholds adopted by ADEQ
due to Maricopa County’s local air
quality problems. In addition, (1) some
of the other permitting programs in
Table 3 above have lower permitting
thresholds in nonattainment areas than
those applicable in attainment areas
under their jurisdiction; (2) in looking at
a similar analysis of minor source
emissions for another permitting
program in Region 9, which has local air
quality problems, the permitting agency
generally set thresholds that include a
larger percentage of emissions in the
NSR program than the percentage
included in ADEQ’s program 12; and (3)
typically, nonattainment areas have
more control requirements that apply to
smaller minor sources, as compared to
attainment areas. As such, ADEQ’s basis
does not clearly address how its
adopted preconstruction review
exemption thresholds adequately
address nonattainment areas.13
Second, while EPA agrees that, in
general, certain types of equipment may
be exempted from the minor NSR
program, ADEQ must provide a basis
under 40 CFR 51.160(e) to demonstrate
that regulation of the equipment
exempted in R18–2–302(C) and A.R.S.
§ 49–426(B) is not needed for ADEQ’s
program to meet federal NSR
requirements for attainment and
maintenance of the NAAQS or review
for compliance with the control strategy.
Such demonstration must address: (1)
An explanation of whether the
regulatory exemption in R18–2–302(C)
for ‘‘agricultural equipment used in
normal farm operations’’ constitutes an
interpretation or refinement of the
exemption for such sources in A.R.S.
11 ADEQ does not have jurisdiction for permitting
of minor sources in Maricopa County, AZ.
12 See EPA’s Technical Support Document for
Revision of Air Quality Implementation Plan;
California; Sacramento Metropolitan Air Quality
Management District; Stationary Source Permits, 78
FR10589, Feb. 2, 2014, at 6–7, describing the
thresholds applicable in Sacramento as generally
excluding less than 5% of the emissions inventory
except for SO2.
13 In addressing this deficiency, ADEQ does not
necessarily have to consider lower permitting
exemption thresholds in nonattainment areas. For
example, ADEQ could provide further analysis to
demonstrate that the adopted thresholds are
appropriate for nonattainment areas or consider a
different approach, such as requiring minor sources
in nonattainment areas subject to a SIP requirement
for the nonattainment pollutant, or its precursors,
to obtain a registration, if ADEQ can demonstrate
that such an approach would serve to satisfy the
requirements of 40 CFR 51.160.
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§ 49–426(B), and how the two
provisions apply to ADEQ’s NSR
program; (2) Identification of the types
of equipment ADEQ considers to be
‘‘agricultural equipment used in normal
farm operations’’ and whether this type
of equipment could potentially be
expected to occur at a stationary source
subject to title V of the Act, 40 CFR
parts 60, 61, or 63, or major NSR, and,
if so, whether such equipment is subject
to NSR review at such sources; (3)
ADEQ’s basis for determining that
‘‘agricultural equipment used in normal
farm operations’’ does not need to be
regulated as part of ADEQ’s minor NSR
program under 40 CFR 51.160(e); and
(4) ADEQ’s interpretation of the
exemption for fuel burning equipment
in A.R.S. § 49–426(B) and how it does,
or does not, apply in the context of its
major and minor NSR programs, and, to
the extent such equipment is not subject
to NSR review, ADEQ’s basis for
determining that equipment exempted
under this provision does not need to be
reviewed as part of ADEQ’s minor NSR
program under 40 CFR 51.160(e).
Finally, ADEQ’s minor NSR program
sets a permitting exemption threshold
for PM2.5 of 5 tons per year, but ADEQ’s
analysis does not provide a basis for this
threshold.
3. Public Availability of Information
40 CFR 51.161 requires that each NSR
program contain certain procedures
related to public participation. We have
identified several deficiencies with
ADEQ’s program as it pertains to these
requirements.
First, ADEQ’s program does not
ensure that NSR review for all minor
sources regulated under ADEQ’s NSR
program, as ADEQ defines it pursuant to
40 CFR 51.160(e), is subject to public
notice and comment consistent with 40
CFR 51.161(a). 40 CFR 51.161(a)
requires that the program under 51.160
provide for public comment on the
information submitted by owners or
operators. In addition, the public
information must include ADEQ’s
analysis of the effects of construction or
modification on ambient air, including
ADEQ’s proposed approval or
disapproval. ADEQ’s program does not
meet this requirement because: (1)
‘‘modification’’ of existing sources that
become subject to the registration
program under R18–2–302.01 (currently
only ‘‘construction’’ of a source) are not
subject to public notice (see R18–2–
302.01(B)(3)); (2) R18–2–334(G) exempts
most modifications from public notice;
(3) R18–2–330 does not clearly define
which public notice requirements apply
to registrations; and (4) public
participation does not appear to be
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required for a proposed disapproval of
an application for any portion of
ADEQ’s NSR program (registration,
minor NSR, or major NSR).
Second, ADEQ’s registration program
at R18–2–302.01(F) does not contain the
necessary enforceable procedures for
sources taking ‘‘elective limits’’ to limit
their potential to emit in a manner that
allows the source to avoid the public
participation requirements in 40 CFR
51.161(a), while otherwise being subject
to the registration program. See R18–2–
302.01(B)(3)(b) and R18–2–302(E)(1).
While ADEQ’s rule contains
requirements for monitoring,
recordkeeping, and reporting of elective
limits, these requirements are not
sufficiently enforceable for purposes of
limiting the source’s potential to emit,
and thereby avoiding public notice, as
well other substantive requirements of
ADEQ’s minor NSR program when
issuing a registration. In order to meet
practical enforceability requirements for
limiting the potential to emit (PTE),
R18–2–302.01(F) must also contain (1) a
technically accurate limitation and the
portions of the source subject to the
limitation and (2) the time period for the
limitations (hourly, daily, monthly,
etc.). Further, if the limitation is over a
period longer than daily, R18–2–
302.01(F) must specify when to compile
daily records to show compliance with
the elected limit. Additional detail on
this issue is provided in our TSD.
Third, ADEQ’s NSR program does not
ensure, for all sources subject to NSR
review, the availability for public
inspection, in at least one location in
the area affected, of the information
submitted by the owner or operator and
of ADEQ’s analysis on the effect on air
quality as required by this federal
regulation. R18–2–330(D)(11) requires
the public notice to identify the nearest
ADEQ office where documents can be
inspected, but there are only two
department offices for ADEQ. See 40
CFR 51.161(b)(1). We do not interpret
this provision as meeting the
requirement to make information
available in the ‘‘area affected.’’ In
addition, the public notice requirements
do not make reference to providing
ADEQ’s analysis for public inspection.
Potentially, this is covered by ‘‘all other
materials available to the Director that
are relevant to the permit decision’’.14
But it is not clear that ADEQ would
interpret this to mean the Director’s own
analysis.
Finally, ADEQ’s NSR program does
provide notice to the necessary parties
in 40 CFR 51.161(d) for sources required
14 This requirement is met for ADEQ’s registration
program at R18–2–302.01(B)(3)(a).
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to obtain registrations under R18–2–
302.01.
4. Administrative Procedures
40 CFR 51.163 requires each NSR
program to include administrative
procedures that will be followed in
making the determinations specified in
40 CFR 51.160(a). While ADEQ’s
program generally meets the
requirements of this provision, ADEQ’s
submittal contains references to other
ADEQ rules, R18–2–317 and R18–2–
317.02, which are not in the SIP and
have not been submitted for SIP
approval. See R18–2–306.02(D), R18–2–
319(I), R18–2–304(J), R18–2–306(A),
and R18–2–306.02(D).
5. Stack Height Procedures
40 CFR 51.164 requires that each NSR
program contain certain provisions
related to good engineering practice for
stack heights. In addition to reviewing
ADEQ’s submittal as compared with the
NSR program requirements of 40 CFR
51.164, we also reviewed ADEQ’s
submittal as it relates to certain general
SIP program requirements in 40 CFR
51.100 and 51.118. The stack height
provisions in the NSR program rely on
the general stack height provisions in 40
CFR 51.118(b), which in turn references
the definitions in 40 CFR 51.100(hh)
through (kk). We have identified several
deficiencies with ADEQ’s program as it
pertains to these requirements.
First, ADEQ’s submittal does not meet
the public hearing requirements in 40
CFR 51.164 and 51.118(a). While R18–
2–332(E) contains a reference to holding
a public hearing, when required, the
provision references ADEQ’s public
hearing provision in R18–1–402. R18–
1–402 is not in the SIP and has not been
submitted for SIP approval.
Second, ADEQ’s submittal does not
contain language that meets the
exception in 40 CFR 51.118(b): ‘‘except
where pollutants are being emitted from
such stacks or using such dispersion
techniques by sources, as defined in
section 111(a)(3) of the Clean Air Act,
which were constructed, or
reconstructed, or for which major
modifications, as defined in
§§ 51.165(a)(1)(v)(A), 51.166(b)(2)(i) and
52.21(b)(2)(i), were carried out after
December 31, 1970.’’ In addition, R18–
2–332(A)(3) incorrectly references July
1, 1975 instead of July 1, 1957 as that
date appears in 40 CFR 51.118(b).
Third, ADEQ’s submittal does not
contain a requirement that owners or
operators seeking to rely on the equation
in 40 CFR 51.100(ii)(2)(i) produce
evidence that the equation was actually
relied on in establishing an emission
limitation. See R18–2–332(B)(2).
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Finally, ADEQ’s submittal contains a
provision at R18–2–332(D) that provides
additional provisions for sources
‘‘seeking credit because of plume
impaction which results in
concentrations in violation of national
ambient air quality standards or
applicable maximum allowable
increases.’’ This provision is not
contained in the federal regulations and
appears to allow for the use of stack
heights beyond GEP stack height, as
defined in 40 CFR 51.100(ii).
In sum, while we have identified
several disapproval issues with ADEQ’s
minor NSR program requirements as
they correspond to federal minor NSR
program requirements, compared to the
existing SIP, approving ADEQ’s minor
NSR program into the Arizona SIP
nonetheless represents a significant
overall strengthening of ADEQ’s NSR
program, as discussed above. Thus, we
are proposing a limited approval and
limited approval of ADEQ’s minor NSR
program submittal.
C. Do the rules meet the evaluation
criteria for Prevention of Significant
Deterioration (PSD)?
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 SIP-approved PSD
permit programs are found in 40 CFR
51.166.
ADEQ rules R18–2–402 and R18–2–
406 contain the substantive
requirements for review and permitting
of PSD sources under ADEQ’s
jurisdiction. These regulations satisfy
most of the statutory and regulatory
requirements for PSD permit programs,
but these and other rules in the NSR SIP
submittal contain several deficiencies
that form the basis for our proposed
limited disapproval, or proposed
disapprovals as discussed below.
Although ADEQ’s submittal meets
most PSD program requirements, we are
proposing to disapprove two specific
aspects of ADEQ’s PSD program. The
ADEQ rule provisions that we are
proposing to disapprove are directly
comparable to federal PSD rule
provisions that have been vacated by
federal courts, and we find that they are
separable from the remainder of ADEQ’s
PSD program. Accordingly, we find
these provisions suitable for disapproval
at this time. These provisions are
described below in Sections II.C.8 and
9.
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For the remainder of ADEQ’s PSD
program submittal, we are proposing
limited approval and limited
disapproval. We find that approval of
ADEQ’s updated PSD program, aside
from the two aspects that are separable
and will be disapproved as mentioned
above, will substantially strengthen the
SIP overall, particularly as the current
SIP-approved PSD program is
significantly out of date when compared
with current federal PSD regulatory
requirements as well as current State
regulations. See our discussion in
Section G below. However, specific
provisions of the PSD SIP program
submittal are inconsistent with PSD
program requirements, and these
deficiencies must be addressed before
we can fully approve ADEQ’s PSD
program. The deficiencies that we have
identified with ADEQ’s PSD program
that provide the basis for our limited
disapproval are described below in
Sections II.C.1 through 7.
1. General PSD Program Requirements
First, ADEQ’s submittal often refers to
Articles 9 and/or 11 of ADEQ’s
regulations where the federal
regulations refer to 40 CFR parts 60, 61,
or 63; or, similarly, sections 111 or 112
of the Act. See R18–2–101(53)(a),
(122)(b); R18–2–401(10); R18–2–
402(G)(2); and R18–2–406(A)(4).
Articles 9 and 11 are where ADEQ
incorporates by reference the federal
regulations in 40 CFR part 60, 61, and
63 (which EPA implements under
sections 111 and 112 of the Act).
However, these Articles are not in the
SIP, have not been submitted for SIP
approval, and do not contain provisions
equivalent to all of the subparts in parts
60, 61, and 63. See 40 CFR
51.166(b)(1)(iii)(aa), (b)(12), (b)(16)(i),
(b)(17), (b)(47)(ii)(c), (b)(49)(ii),
(i)(1)(ii)(aa), and (j).
Second, ADEQ’s submittal uses the
term ‘‘increment’’ or ‘‘incremental
ambient standard,’’ but does not
specifically define these terms or
otherwise identify what is meant by
these terms. While the PSD program
does not specifically define the term
‘‘increment’’ either, the term is
introduced at 40 CFR 51.166(c)—
Ambient air increments and other
measures. (emphasis added) 40 CFR
51.166(c) then goes on to identify the
specific increment values as ‘‘maximum
allowable increases.’’ ADEQ appears to
have taken the approach of using the
term ‘‘maximum allowable increase’’ to
refer to the increments, which is
acceptable. ADEQ adopted the
increments, or maximum allowable
increases, in R18–2–218—Limitation of
Pollutants in Classified Attainment
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Areas. However, in other rules ADEQ
uses ‘‘increment’’ or ‘‘incremental
ambient standard’’ where it appears the
intent is to refer to the increments
established in R18–2–218 and identified
in ADEQ’s rules as the ‘‘maximum
allowable increases.’’ See R18–2–406(E),
R18–2–412(G)(b), R18–2–101(51), R18–
2–319, R18–2–320.
Third, on January 15, 2013, EPA
issued a final rule revising the NAAQS
for PM2.5 for the annual averaging
period, lowering the level of the
NAAQS from 15.0 to 12.0 mg/m3,
effective March 18, 2013 (see 78 FR
3086). This new NAAQS is required to
be implemented for PSD sources (unless
otherwise grandfathered under
provisions at 40 CFR 51.166(i)(10))
beginning with the effective date of the
NAAQS. However, ADEQ’s PSD
program does not provide for the review
of new or modified sources for
compliance with this new NAAQS as
required in 40 CFR 51.166(b)(2)(iii)(i)(2),
(b)(35), (d), (g)(3)(iii), (k), and (m)(1).
Instead, ADEQ’s PSD program currently
references state ambient air quality
standards, which are set at levels that
are equivalent to all of the current
NAAQS, except for this newly adopted
PM2.5 NAAQS. See R18–2–218(F)(b)(ii),
R18–2–401(25), R18–2–406(A) and R18–
2–407(B). Because of the general
approach used in ADEQ’s NSR program
with respect to incorporating the
NAAQS, i.e., the program’s reference to
state air quality standards instead of the
NAAQS, any changes EPA makes to the
NAAQS will not be included in ADEQ’s
program until ADEQ revises its air
quality standards rules to adopt the
revised NAAQS as state air quality
standards. This does not relieve any
owner or operator from the requirement
to comply with all NAAQS at the time
a final PSD permit is issued, including
the recently revised new PM2.5 NAAQS
(unless otherwise grandfathered under
40 CFR 51.166). See CAA section
165(a)(3).
Fourth, R18–2–406(A) contains a
reference to R18–2–408, but R18–2–408
is not in the SIP and has not been
submitted for SIP approval.
Fifth, ADEQ’s submittal allows a
source at R18–2–302(G) and R18–2–
402(C) to begin actual construction
upon the issuance of a proposed final
permit. As previously discussed,
ADEQ’s program is ambiguous as to
whether a proposed final permit, as
defined in R18–2–101(114), constitutes
final action by the Director. While
ADEQ has issued guidance clarifying
that it treats ‘‘proposed final permits’’ as
final actions for purposes of
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preconstruction permitting 15, to obtain
full PSD program approval, ADEQ’s
regulations must make clear that a
source may not begin actual
construction before a final
determination on a PSD permit
application is made by the Director.
Sixth, ADEQ’s NSR submittal
contains provisions that allow for
exclusions from increment
consumption, for certain temporary
emissions, that do not conform to the
requirements in the analogous federal
rule. First, ADEQ’s rule at R18–2–
218(F)(5) requires only the ADEQ
Director’s approval for temporary
emissions beyond two years, but the
federal program requirements at 40 CFR
51.166(f)(i)(v) and 51.166(f)(4) require
the Administrator’s approval to allow
temporary emissions that exceed two
years. In addition, ADEQ’s program
language does not reference a specific
time period beyond two years that it
would allow for exclusions from
increment consumption, which is not
consistent with the federal regulation’s
requirement at 40 CFR 51.166(f)(4) that
the time for such exclusions be
specified in the plan. Finally, the
provision at R18–2–218(F)(5)(b)(ii),
which references the state ambient air
quality standards, must be applied to
‘‘any’’ air quality control region. As
currently written this provision does not
clearly apply to areas outside of Arizona
where Arizona’s standards would not
generally apply.
Seventh, ADEQ’s submittal contains a
provision at R18–2–406(E) providing an
exemption for certain portable
stationary sources with a prior permit
that contains requirements equivalent to
the PSD requirements in 40 CFR 51.166
(j) through (r), as allowed by 40 CFR
51.166(i)(1)(iii). However, ADEQ’s rule
at R18–2–406(E) is worded broadly to
also allow an exemption for portable
sources that have been permitted under
Article 4 of ADEQ’s regulations, which
also includes nonattainment NSR
permits and PAL permits. We do not
interpret this federal exemption as
generally applying to such permits, as it
is not clear that such permits contain
requirements ‘‘equivalent’’ to those in
40 CFR 51.166(j) through (r).
Eight, ADEQ’s submittal contains
conditions generally meeting the
requirements of 40 CFR 51.166(k)(1) in
rule R18–2–406(A)(5)(a). However, R18–
2–406(A)(5) contains an ‘‘or’’ between
subsections (a) and (b) that could be
interpreted as allowing a source to
demonstrate it will not contribute to an
15 See ADEQ memo dated February 10, 2015
related to proposed final permits, and ADEQ’s
February 23, 2015 Supplement at 2.
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increase above the significance levels in
an adjacent nonattainment area in lieu
of the demonstration required by R18–
2–406(A)(5)(a). The provisions of
subsection (b) relate to requirements
under a different portion of the NSR
program—specifically under 40 CFR
51.165. As such, it is likely ADEQ
would interpret subsections (a) and (b)
as separate requirements with which a
source must demonstrate compliance.
Nevertheless, the potential for
misinterpretation of this substantive
requirement of the PSD program
provides a basis for our limited
disapproval of the PSD program
submittal. In addition, R18–2–
406(A)(5)(a) requires that a person
applying for a PSD permit demonstrate
that the project would not cause a
violation of any maximum allowable
increase over the baseline concentration
in ‘‘any attainment or unclassifiable
area.’’ However, ADEQ’s definition for
‘‘attainment area’’ in the SIP at R18–2–
101(19) limits attainment areas to those
‘‘in the state.’’ In addition, as discussed
previously, it is not clear that ADEQ’s
references to the state’s ambient air
standards would apply in areas outside
of Arizona.
Ninth, ADEQ’s submittal includes
R18–2–406(A)(6)(b), which specifies
that the use of a modified or substituted
model must be subject to public notice
and the opportunity for public
comment, but neither the rule nor the
submittal makes clear the procedures
that would be used for notice and
comment for this purpose or
demonstrates that such procedures
would be consistent with 40 CFR
51.102, as required by 40 CFR
51.166(l)(2).
Tenth, ADEQ’s PSD SIP submittal
does not appear to specifically address
the requirements of 40 CFR 51.166(n)(1)
and (3), which require that the SIP must
require that (1) the owner or operator of
a proposed source or modification shall
submit all information necessary to
perform any analysis or make any
determination required under
procedures established in accordance
with 40 CFR 51.166, and (2) upon
request of the state, the owner or
operator shall also provide specified
information concerning air quality
impacts and growth. ADEQ’s submittal
at R18–2–304, R18–2–402(G) and R18–
2–407 identifies the information
necessary for a complete application
under this program and requires
applicants to respond to deficiencies in
the application, but these provisions do
not appear to fully address the
requirements of 40 CFR 51.166(n)(1) and
(3).
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Eleventh, ADEQ’s submittal contains
an apparent typographical error in R18–
2–402(F)(1)(c), which includes a crossreference to R18–2–401(20)(b)(iii) rather
than R18–2–401(20)(b)(iv). See 40 CFR
51.166(r)(6).
Finally, ADEQ’s submittal does not
require owners or operators to make
information required under 40 CFR
51.166(r)(6) available for review upon
request by the Director or the general
public pursuant to the requirements in
40 CFR 70.4(b)(3)(viii) as is required by
40 CFR 51.166(r)(7).
2. Restrictions on Area Classifications
40 CFR 51.166(e) contains provisions
related to restrictions on area
classifications (Class I, II, or II). We have
identified several deficiencies in
ADEQ’s program with respect to these
provisions.
First, ADEQ’s submittal contains
requirements for area classifications in
R18–2–217. However, ADEQ’s submittal
does not completely meet the
requirements of 40 CFR 51.166(e) and
section 162(a) of the Act, which require
certain areas in existence on August 7,
1977 to be designated as Class I areas.
Such designations apply to any
boundary changes made to those Class
I areas after August 7, 1977. While
ADEQ generally includes this
requirement at R18–2–217(B), its rule
limits such boundary changes to those
made prior to March 12, 1993.
Second, ADEQ’s NSR submittal at
R18–2–217 does not contain a provision
consistent with the federal regulatory
requirement for Class I area
redesignations prior to August 7, 1977
in rule R18–2–217 or elsewhere as
required by 40 CFR 51.166(e)(2). Even if
it is the case that there are no areas in
Arizona that were redesignated Class I
prior to August 7, 1977, ADEQ’s
program must recognize Class I area
designations under this provision that
may have been made in other states for
which sources within ADEQ may have
an impact. See 40 CFR 51.166(e)(2).
Finally, ADEQ’s NSR submittal does
not include a provision that is fully
consistent with 40 CFR 51.166(e)(3).
While ADEQ’s rules generally meet this
requirement at R18–2–217(D), this rule
does not fully meet the requirements of
40 CFR 51.166(e)(3) because (1) it is not
clear what is meant in ADEQ’s rule by
‘‘all other areas’’ and (2) it does not
contain a provision that ensures that
ADEQ recognizes federal legislation that
specified the area classification of a
particular area.
3. Redesignations
40 CFR 51.166(g) contains provisions
allowing certain areas classified as Class
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I, II, or III to be redesignated to another
classification. We have identified
several deficiencies in ADEQ’s program
with these provisions.
First, ADEQ’s submittal contains
provisions at R18–2–217(A) identifying
that attainment and unclassifiable areas
in the State shall be designated as Class
I, II, or III. However, this portion of the
PSD program applies to all areas of the
State. That is, all areas of the State must
be designated as Class I, II, or III
irrespective of their attainment
designation under Section 107 of the
Act. See 40 CFR 51.166(g)(1).
Second, ADEQ’s submittal contains
provisions at R18–2–217(E) for allowing
the state to redesignate certain areas, but
the submittal does not adequately meet
the public participation requirements
specified in the federal regulation at 40
CFR 51.166(g)(2)(i), which requires a
public hearing consistent with the
procedures in 40 CFR 51.102. ADEQ’s
redesignation provisions do not specify
the public hearing procedures that will
be used. See 40 CFR 51.166(g)(2)(i).
Third, ADEQ’s provisions for
redesignating areas to Class III do not
clearly identify which areas may be
designated as Class III as specified in 40
CFR 51.166(g)(3).
Fourth, R18–2–217(E) allows for the
redesignation to be approved by the
Governor or the Governor’s designee.
However, the federal program at 40 CFR
51.166(g)(3)(ii) specifically requires the
Governor’s approval and does not allow
for this approval to be delegated. See 40
CFR 51.166(g)(3)(ii).
Fifth, R18–2–217(F)(4) contains a
reference to ‘‘maximum allowable
concentration’’ which appears to refer to
R18–2–218(E). However, R18–2–218(E)
references the ‘‘ambient air quality
standards in this Article.’’ The state’s
ambient air quality standards do not
generally apply in areas outside of
Arizona, and ADEQ’s NSR submittal
does not demonstrate that they would
apply outside of Arizona for purposes of
R18–2–217(F)(4). See 40 CFR
51.166(g)(3)(iii).
Finally, ADEQ’s provisions do not
clearly require that a permit application
that can only be approved if an area is
redesignated to Class III, and material
submitted as part of that application,
must be available for public inspection
prior to the public hearing on the
redesignation to Class III. See 40 CFR
51.166(g)(3)(iv).
4. Impacts on Class I Areas
40 CFR 51.166(p) contains additional
requirements related to protection of
Federal Class I areas. We have identified
several deficiencies in ADEQ’s program
with these provisions.
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First, ADEQ’s submittal does not
address the requirements of 40 CFR
51.166(p)(1), but they are generally
addressed by existing SIP requirements
in R9–3–304(H). However, the existing
SIP only requires application
information to be submitted to the
Federal Land Manager, and does not
require that this information be
provided to EPA as required by this
provision. Consistent with 40 CFR
51.166(p)(2), the Federal Land Manager
works in consultation with EPA on the
protection of Class I lands.
Second, ADEQ’s submittal does not
address the requirement under 40 CFR
51.166(p)(3), but it is addressed by the
existing SIP requirement in R9–3–
304(H)(1). However, the existing SIP
contains outdated maximum allowable
increases that must be updated. See 40
CFR 51.166(p)(3).
Finally, ADEQ’s submittal generally
includes the provisions of 40 CFR
51.166(p)(4) at R18–2–406(F)(2), but
contains the phrase ‘‘no significant
adverse impacts,’’ which is inconsistent
with the federal regulation which
requires a demonstration of ‘‘no adverse
impacts.’’ The addition of the word
‘‘significant’’ is somewhat ambiguous in
this context, but appears to allow
variances under circumstances not
allowed under the analogous federal
regulation.
5. Public Participation
40 CFR 51.166(q) contains several
specific public participation
requirements for issuing PSD permits.
We have identified several public
participation deficiencies in ADEQ’s
program.
First, ADEQ’s submittal does not
ensure that materials available during
the public comment period are available
in each region in which the proposed
source would be constructed as required
by 40 CFR 51.166(q)(2)(ii). While
ADEQ’s program at R18–2–330(D)(11)
requires these materials to be available
at the nearest Department office, ADEQ
only has two Department offices. As
such, it is not clear that in all instances
the public affected by a proposed
project would have reasonable access in
their region to the materials specified in
40 CFR 51.166(q)(2)(ii).
Second, ADEQ’s submittal does not
require ADEQ to notify the public of (1)
the degree of increment consumption
that is expected from the source or
modification, or (2) the Director’s
preliminary determination, as required
by 40 CFR 51.166(q)(2)(iii).
Third, ADEQ’s submittal does not
require ADEQ to make the public
comments and the written notification
of its final determination available in
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the same location as the preliminary
documents as required by 40 CFR
51.166(q)(2)(vi) and (viii).
Finally, ADEQ’s submittal requires
the Director to take final action on an
application within one year of receipt of
a complete application—R18–2–
402(I)(3). See 40 CFR 51.166(q)(2)(vii).
However, ADEQ’s program also
indicates that a source may begin actual
construction once a ‘‘proposed final
permit’’ is obtained. See R18–2–402(C)
and R18–2–302(G). ADEQ’s regulations
are ambiguous as to whether a proposed
final permit, as defined in R18–2–
101(114), constitutes final action by the
Director that is subject to administrative
and/or judicial review. As EPA has
stated previously in the context of our
actions on other State SIP submittals,
we interpret the CAA to require an
opportunity for judicial review of a
decision to grant or deny a PSD permit,
whether issued by EPA or by a State
under a SIP-approved or delegated PSD
program. 77 FR 65305, 65306, Oct. 26,
2012 (EPA’s approval of the San Joaquin
Valley Unified Air Pollution Control
District’s PSD program into the
California SIP); see also 61 FR 1880,
1882. Jan. 24, 1996 (EPA’s proposed
disapproval of Virginia’s PSD program
SIP revision due to State law standing
requirements that limited judicial
review); 72 FR 72617, 72619, Dec. 21,
2007 (in approving South Dakota’s PSD
program, EPA stated that it interprets
the CAA and regulations to require at
minimum an opportunity for state
judicial review of PSD permits). EPA
continues to interpret the relevant
provisions of the Act as described in
these prior rulemaking actions. While
ADEQ has issued guidance clarifying
that it treats ‘‘proposed final permits’’ as
‘‘appealable agency actions,’’ under
Arizona law,16 in order to obtain full
PSD program approval, ADEQ’s
regulations must make clear that a
source may not begin actual
construction before a final
determination on a PSD permit
application is made by the Director,
which would be subject to
administrative and/or judicial review.
6. Plantwide Applicability Limits
ADEQ’s rules contain provisions for
using plantwide applicability limits
(PALs) in R18–2–412. We have
identified the following deficiencies
with ADEQ’s PALs provisions program
as they relate to the PSD program.
First, neither the ADEQ regulatory
provisions for PALs at R18–2–412 nor
16 See ADEQ memo dated February 10, 2015
related to proposed final permits. ADEQ submitted
this memo in its February 23, 2015 supplement.
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the ADEQ regulatory definitions in R18–
2–401 that apply in the context of major
sources and major modifications contain
a definition for major emissions unit as
is required by 40 CFR 51.166(w)(2)(iv).
(This term is also not included in the
definitions at R18–2–101 or R18–2–301
that ADEQ submitted for approval as
part of this action.)
Second, ADEQ’s PAL provision for
calculating baseline emissions at R18–
2–412(B)(2) does not specify that
baseline actual emissions are to include
emissions associated not only with
operation of the unit, but also emissions
associated with startup, shutdown and
malfunction, as is required by 40 CFR
51.166(w)(3)(ii).
Third, ADEQ’s PAL provisions at
R18–2–412(H) contain an incorrect
reference to (H)(4) instead of the
definition for major modification, and
R18–2–412(H)(5) uses ‘‘eliminated’’
where the federal regulation uses
‘‘established.’’ See 40 CFR 51.166(w)(9).
Finally, ADEQ’s PAL renewal
provisions at R18–2–412(I)(1) must
contain a reference to subsection (D) of
R18–2–412 instead of (F). In addition,
R18–2-(I)(4)(a) must reference
subsection (E) of R18–2–412. See 40
CFR 51.166(w)(10).
7. Definitions
ADEQ’s submittal contains definitions
applicable to the PSD program that do
not fully meet the requirements of 40
CFR 51.166(b)(1), which requires each
State plan to contain specific definitions
for the PSD program. Deviations from
the wording are approvable if the State
specifically demonstrates that the
submitted definition is more stringent,
or at least as stringent, in all respects as
the corresponding definition in 40 CFR
51.166(b). We have carefully reviewed
the definitions used in ADEQ’s PSD
program as compared with the federal
PSD definitions in 40 CFR 51.166(b) and
have found that, generally, ADEQ’s
submittal contains the definitions
necessary to implement a PSD program.
However, a number of ADEQ’s
definitions do not meet the
requirements of 40 CFR 51.166(b)(1)
because their wording deviates from the
wording in the corresponding federal
regulatory definitions in 40 CFR
51.166(b)(1) in a manner that may be
less stringent than the federal
definitions, and the State has not
demonstrated otherwise.
Major stationary source at 40 CFR
51.166(b)(1)—language from
subparagraph 40 CFR 51.166(b)(1)(i)(c)
not included in the definition at R18–
2–101(75). See also discussion below of
the definition of ‘‘stationary source’’ in
40 CFR 51.166(b)(5).
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Net emissions increase at 40 CFR
51.166(b)(3)—ADEQ’s definition at R18–
2–101(87)(c) identifies that an increase
or decrease in actual emissions is
creditable only to the extent that the
Director has not relied on it in issuing
a permit. However, this definition is
broader than the definition in the PSD
program, which only specifies that the
reviewing authority has not relied on
the increase or decrease in issuing a
PSD permit. In some respects this makes
ADEQ’s definition more stringent
(decreases), but in other respects less
stringent (increases). In addition, the
equivalent of paragraph 40 CFR
51.166(b)(3)(viii) is not included in
ADEQ’s definition at R18–2–101(87).
Stationary source at 40 CFR
51.166(b)(5)—the federal regulation at
40 CFR 51.166(b)(5) defines this term as
‘‘any building, structure, facility or
installation which emits or may emit a
regulated NSR pollutant,’’ with
‘‘regulated NSR pollutant’’ also being a
federally defined term at 40 CFR
51.166(b)(49), whereas ADEQ’s
regulation at R18–2–101(39) defines
‘‘stationary source’’ as ‘‘any building,
structure, facility or installation subject
to regulation pursuant to A.R.S. § 49–
426(A) which emits or may emit any air
pollutant,’’ with ‘‘air pollutant’’ being
an undefined term in ADEQ’s
regulation. We note that A.R.S. § 49–
426(A) provides a cross-reference to
certain exemptions from permitting
identified in A.R.S. § 49–426(B),
specifically agricultural equipment used
in normal farm operations and certain
fuel burning equipment, which do not
appear to be consistent with the federal
PSD definition. The federal definition
for stationary source is very broad and
does not exclude these source
categories. We agree that it is acceptable
for ADEQ to limit its NSR program to
certain kinds of stationary sources, as
specified in 40 CFR 51.160(e), but the
federal definition for a stationary source
in the context of the PSD program is not
the appropriate place for such an
exclusion, as it does not allow
exclusions for certain source categories.
Major source baseline date at 40 CFR
51.166(b)(14)—language equivalent to
paragraph 40 CFR 51.166(b)(14)(iv) is
not included at ADEQ’s definition in
R18–2–218(B)(1).
Baseline area 40 CFR 51.166(b)(15)—
ADEQ’s definition at R18–2–218(D)
contains an incorrect reference to R18–
2–217 rather than referring to section
107(d)(1)(A)(ii) or (iii) of the Act or the
equivalent; also, language equivalent to
that in paragraph 40 CFR
51.166(b)(15)(iii) is not included.
Allowable emissions at 40 CFR
51.166(b)(16)—ADEQ’s definition at
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R18–2–101(13)(b) does not include the
‘‘future compliance date’’ language that
is in 40 CFR 51.166(b)(16)(ii) and ADEQ
has not demonstrated that its regulatory
language is at least as stringent as the
federal definition.
Federally enforceable at 40 CFR
51.166(b)(17)—ADEQ’s definition at
R18–2–101(53)(d) identifies that
requirements included in permits
pursuant to R18–2–306.01 or R18–2–
306.02 are included in the definition of
federally enforceable requirements, but
excludes those requirements that are
identified as ‘‘enforceable only by the
state.’’ With this action, we approving
R18–2–306.01 and R18–2–306.02 into
the SIP, making requirements pursuant
to these rules federally enforceable. As
such, ADEQ does not have the
discretion to identify some of those
requirements as only enforceable by the
state.
Complete at 40 CFR 51.166(b)(22)—
ADEQ’s definition at R18–2–401(4) is
missing the second sentence of the
federal definition.
Significant at 40 CFR 51.166(b)(23)–
ADEQ definition at R18–2–101(130)(e)
uses ‘‘milligrams’’ instead of
‘‘micrograms’’ as required in paragraph
40 CFR 51.166(b)(23)(iii).
Projected actual emissions at 40 CFR
51.166(b)(40)—ADEQ’s definition at
R18–2–401(20)(b)(iii) does not
specifically require inclusion of
emissions from malfunctions in the
determination of projected actual
emissions, and exempts emissions from
a shutdown associated with a
malfunction from such determination,
while the federal definition at 40 CFR
51.166(b)(40)(ii)(b) requires that
emissions from both shutdowns and
malfunctions be included.
Subject to regulation at 40 CFR
51.166(b)(48)—this definition is not
included in ADEQ’s NSR SIP submittal.
ADEQ did not adopt a definition for the
term ‘‘subject to regulation’’ or include
such definition as part of the NSR SIP
submittal, presumably because the
federal definition of the term contains
the requirements of the Greenhouse Gas
(GHG) Tailoring Rule, and GHGs cannot
be regulated under Arizona state law.17
We note, however, that while the GHG
program requirements are contained as
part of the definition of the term
‘‘subject to regulation,’’ the federal
definition of this term also contains
17 ADEQ is currently subject to a Federal
Implementation Plan under the PSD program for
GHGs because ADEQ did not adopt a PSD program
for the regulation of GHGs. See 40 CFR 52.37.
ADEQ’s NSR SIP submittal does not attempt to
correct this program deficiency, as regulation of
GHG emissions currently is not permitted under
State law. See A.R.S. § 49–191.
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non-GHG-specific program elements for
determining when a pollutant is
‘‘subject to regulation.’’ As such, ADEQ
must add a definition to its PSD
regulations to address these elements of
the term ‘‘subject to regulation’’ in order
to obtain full program approval.
Regulated NSR pollutant at 40 CFR
51.166(b)(49)—ADEQ’s regulatory
definition at R18–2–101(122) does not
include the final two sentences of 40
CFR 51.166(b)(49)(i)(a)or the language at
40 CFR 51.166(b)(49)(iv); ADEQ’s
definition also includes an incorrect
cross-reference to hazardous air
pollutants listed under R18–2–1101 that
is not consistent with the requirements
in 40 CFR 51.166(b)(49)(v); and ADEQ’s
regulatory definition needs to update
the July 1, 2010 date in the crossreference to CAA section 108.
8. PM2.5 Significant Monitoring
Concentration
On January 22, 2013, the U.S. DC
Circuit Court of Appeals in Sierra Club
v. EPA, 705 F.3d 458, vacated the parts
of two federal PSD rules (40 CFR
51.166(i)(5)(i)(c) and 40 CFR
52.21(i)(5)(i)(c)) establishing a PM2.5
significant monitoring concentration
(SMC), finding that EPA was precluded
from using the PM2.5 SMC to exempt
permit applicants from the statutory
requirement to compile and submit
preconstruction monitoring data as part
of a complete PSD application. On
December 9, 2013, revisions to 40 CFR
51.166 and 52.21 were published in the
Federal Register to remove these
vacated rule elements, effective as of
that date. See 78 FR 73698.
ADEQ’s submittal at R18–2–
407(H)(1)(c) contains the equivalent of
the PM2.5 SMC that was vacated by the
Court of Appeals and which has been
removed from the federal PSD
regulations. As the Court of Appeals
found application of this SMC
impermissible, and because ADEQ’s
regulation incorporating this SMC is a
separable portion of ADEQ’s PSD
program, we are proposing a partial
disapproval of ADEQ’s submitted PSD
program, to disapprove R18–2–
407(H)(1)(c).
9. Definition for Basic Design Parameter
ADEQ’s submittal contains a
definition for basic design parameter at
R18–2–401(3) that reflects the definition
that EPA originally developed as part of
its Equipment Replacement Provisions.
See 68 FR 61248 Oct. 27, 2003.
However, the definition for basic design
parameter, and other elements related to
the Equipment Replacement Provisions,
were vacated by the DC Circuit Court of
Appeals in State of New York v. EPA,
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443 F.3d 880 (D.C. Cir. 2006). While the
federal PSD regulations still contain a
reference to ‘‘basic design parameter,’’
this term is no longer specifically
defined under the federal PSD
regulations, and application of the
definition contained in the Equipment
Replacement Provisions that were
vacated by the Court of Appeals is
inconsistent with federal PSD
requirements. As the Court of Appeals
found this Equipment Replacement
Provisions and, therefore, this
definition, impermissible, and because
ADEQ’s regulation incorporating this
definition is a separable portion of
ADEQ’s PSD program, we are proposing
a partial disapproval of ADEQ’s
submitted PSD program, to disapprove
R18–2–401(3).
D. Do the rules meet the evaluation
criteria for 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 ‘‘NA–NSR.’’ EPA’s
regulations for NA–NSR permit
programs are found in 40 CFR 51.165.
Most areas under ADEQ’s jurisdiction
are currently designated as ‘‘attainment’’
or ‘‘unclassifiable/attainment’’ for all
NAAQS pollutants. However, there are
some areas under ADEQ’s jurisdiction
that are nonattainment and warrant a
NA–NSR program. See 40 CFR 81.303.
R18–2–402 through 405 contain the
substantive NA–NSR requirements for
review and permitting of major sources
and major modifications in
nonattainment areas under ADEQ
jurisdiction in Arizona. These
regulations satisfy most of the statutory
and regulatory requirements for NA–
NSR permit programs, but these rules
contain several deficiencies that that do
not allow us to fully approve the NA–
NSR program submittal that is the
subject of this action, as discussed
below.
Although ADEQ’s NA–NSR program
submittal meets most NA–NSR program
requirements, we are proposing to
disapprove one specific aspect of
ADEQ’s NA–NSR program relating to
the definition of ‘‘basic design
parameter.’’ The ADEQ rule provision
that we are proposing to disapprove is
directly comparable to a federal NA–
NSR rule provision that has been
vacated by a federal court, and we find
that it is separable from the remainder
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of ADEQ’s NA–NSR program.
Accordingly, we find this provision
suitable for disapproval at this time.
This issue is described in more detail
below in Section II.D.4.
For most of the remainder of ADEQ’s
NA–NSR program submittal, we are
proposing limited approval and limited
disapproval. We find that approval of
ADEQ’s updated NA–NSR program,
aside from the aspect that is separable
and is proposed for disapproval as
mentioned above, will substantially
strengthen the SIP overall, particularly
as the current SIP-approved NA–NSR
program is significantly out of date
when compared with current federal
NA–NSR regulatory requirements as
well as current State regulations. See
our discussion in Section G below.
However, specific provisions of the NA–
NSR SIP program submittal are
inconsistent with NA–NSR program
requirements, and these deficiencies
must be addressed before we can fully
approve ADEQ’s NA–NSR program into
the SIP. The deficiencies that we have
identified with ADEQ’s NA–NSR
program that provide the basis for our
limited approval and limited
disapproval are described immediately
below in Sections II.D.1 through 3.18
1. General Nonattainment NSR Program
Requirements
First, as discussed above with respect
to ADEQ’s PSD program submittal,
ADEQ’s NA–NSR program submittal
often refers to Articles 9 and/or 11 of
ADEQ’s regulations where the federal
regulations refer to 40 CFR parts 60, 61,
or 63; or, similarly, sections 111 or 112
of the Act. See R18–2–101(122)(b); R18–
2–401(10); R18–2–402(G)(2); and R18–
2–406(A)(4). Articles 9 and 11 are where
ADEQ incorporates by reference the
federal regulations in 40 CFR parts 60,
61, and 63 (which EPA implements
under sections 111 and 112 of the Act).
However, these Articles are not in the
SIP, have not been submitted for SIP
approval, and do not necessarily contain
provisions equivalent to all of the
subparts in parts 60, 61, and 63. See 40
CFR 51.165(a)(1)(xiii)—lowest
achievable emission rate,
(a)(1)(xxxvii)—regulated NSR pollutant,
and (a)(1)(xl)—best available control
technology.
Second, the nonattainment NSR
program requirements at 40 CFR
18 For one other aspect of ADEQ’s NA–NSR SIP
submittal, we are proposing limited approval at this
time. We cannot determine at this time whether
ADEQ’s NA–NSR SIP submittal adequately
addresses all of elements necessary to satisfy the
CAA’s title I, part D, subpart 4 requirements
regarding NSR permitting of PM2.5 and PM10
precursors under CAA section 189(e). This issue is
discussed in detail in Section II.D.5 below.
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51.165(a)(2) require each plan to have a
preconstruction review program to
satisfy the requirements of sections
172(c) and 173 of the Act. However, as
previously discussed in this preamble,
ADEQ’s submittal allows a source at
R18–2–302(G) and R18–2–402(C) to
begin actual construction upon the
issuance of a proposed final permit.
ADEQ’s program is ambiguous as to
whether a proposed final permit, as
defined in R18–2–101(114), constitutes
final action by the Director. While
ADEQ has issued guidance clarifying
that it treats ‘‘proposed final permits’’ as
final actions for purposes of
preconstruction permitting,19 to obtain
full NA–NSR program approval, ADEQ’s
regulations must make clear that a
source may not begin actual
construction before a final
determination on an NA–NSR permit
application is made by the Director.
Third, 40 CFR 51.165(a)(3)(ii)(G)
requires that credit for emission
reductions can be claimed only to the
extent that the reviewing authority has
not relied on it in issuing any permit
under regulations approved pursuant to
40 CFR 51 subpart I or the State has not
relied on it in demonstration of
attainment or reasonable further
progress. ADEQ’s NSR submittal
generally addresses this requirement at
R18–2–404(H), but also needs to include
references to rules R18–2–302.01 and
R18–2–334, which are to be approved as
part of ADEQ’s NSR regulations under
Subpart I.
Fourth, ADEQ’s submittal contains an
apparent typographical error in R18–2–
402(F)(1)(c), which includes a crossreference to R18–2–401(20)(b)(iii) rather
than R18–2–401(20)(b)(iv). This error
must be corrected to ensure that the
requirement in 40 CFR 51.165(a)(6)(i)(c)
for owners and operators to document
and maintain a record of certain
applicability-related information is
satisfied.
Fifth, ADEQ’s submittal does not
require owners or operators to make
information required under 40 CFR
51.165(a)(6) available for review upon
request by the Director or the general
public pursuant to the requirements in
40 CFR 70.4(b)(3)(viii) as is required by
40 CFR 51.165(a)(7).
Sixth, 40 CFR 51.165(a)(9)(i) requires
that increases in emissions shall be
offset by reductions in emissions using
a ratio of emission decreases to emission
increases of at least 1 to 1. ADEQ’s NA–
NSR submittal contains this
requirement at R18–2–404(A), but could
19 See ADEQ Memo dated February 10, 2015
related to proposed final permits and ADEQ’s
February 23, 2015 Supplement at 2.
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be interpreted as establishing the ratio
as increases to decreases, instead of
decreases to increases—‘‘emission
increases shall be offset by emission
decreases at a ratio of at least 1 to 1.’’
In addition, R18–2–404(A) refers to
additional offset requirements in R18–
2–405, but does not refer to the offset
requirement in R18–2–404(J).
Seventh, 40 CFR 51.165(a)(11)
requires emission offsets to be obtained
for the same regulated NSR pollutant,
unless interprecursor offsetting is
permitted for a particular pollutant, as
further specified in the rule. ADEQ’s
NA–NSR SIP submittal does not address
interprecursor offsets, and it is not
required to, but the submittal does not
contain a specific requirement that
offsets must be for the same regulated
pollutant.
Eighth, 40 CFR 51.165(b) requires that
ADEQ have a preconstruction program
that satisfies the requirements of section
110(a)(2)(D)(i) of the Act for any new
major stationary source or major
modification that would locate in an
attainment area, but would cause or
contribute to a violation of a NAAQS in
any adjacent area. ADEQ’s program
contains provisions for 40 CFR
51.165(b) at R18–2–406(A)(5)(a)–(b) that
generally meet this requirement.
However, ADEQ’s regulations at R18–2–
406(A)(5)(b) refer to the ‘‘Arizona
primary or secondary ambient air
quality standards,’’ which is not a
defined term, whereas the analogous
federal program provisions refer to the
NAAQS. As a result, ADEQ’s program
does not fully meet the requirements in
40 CFR 51.165(b)(1) and (2) as ADEQ’s
regulations do not make clear which
standards are being referred to, and the
submittal does not demonstrate that
such standards would apply to areas
outside of Arizona for purposes of
ADEQ’s NSR review. Similarly, ADEQ’s
regulation at R18–2–406(A)(5)(a)
references the state’s ambient air quality
standards in Article 2, which would not
clearly apply to areas outside of
Arizona.
Finally, Section 173(a)(4) of the Act
requires that NA–NSR permit programs
shall provide that permits to construct
and operate may be issued if ‘‘the
Administrator has not determined that
the applicable implementation plan is
not being adequately implemented for
the nonattainment area in which the
proposed source is to be constructed or
modified.’’ However, ADEQ’s program
does not contain a provision that would
prohibit the issuance of NA–NSR
permits in areas where the
Administrator has made this
determination or that requires that
ADEQ conduct a review to ensure that
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this requirement is met. To obtain full
program approval, ADEQ must add a
provision to its NA–NSR program
requirements that ensures compliance
with CAA section 173(a)(4).
2. Plantwide Applicability Limits
ADEQ’s rules contain provisions for
using plantwide applicability limits
(PALs) in R18–2–412. We have
identified the following deficiencies
with ADEQ’s PALs provisions program
as they relate to the NA–NSR program.
First, ADEQ’s provision for PALs does
not specify that modifications under a
PAL do not need approval through the
nonattainment major NSR program.
Only the PSD program is mentioned.
ADEQ’s submittal does not contain a
definition for nonattainment major NSR
program (see 40 CFR 51.165(a)(1)(xxx)).
ADEQ should either add this definition
or considering referencing R18–2–403.
See 40 CFR 51.165(f)(1)(iii)(B).
Second, neither the ADEQ regulatory
provisions for PALs at R18–2–412 nor
the ADEQ regulatory definitions in R18–
2–401 that apply in the context of major
sources and major modifications contain
a definition for major emissions unit as
is required by 40 CFR 51.165(f)(2)(iv).
Third, ADEQ’s PAL provision for
calculating baseline emissions at R18–
2–412(B)(2) does not specify that
baseline actual emissions are to include
emissions associated not only with
operation of the unit, but also emissions
associated with startup, shutdown and
malfunction, as is required by 40 CFR
51.165(f)(3)(ii).
Fourth, ADEQ’s PAL provisions at
R18–2–412(H) contain an incorrect
reference to R18–2–412(H)(4) instead of
the definition for major modification,
and R18–2–412(H)(5) uses ‘‘eliminated’’
where the federal regulation uses
‘‘established.’’ See 40 CFR 51.165(f)(9).
Finally, ADEQ’s program contains
incorrect cross-references in meeting the
requirements of 40 CFR 51.165(f)(1), as
follows: ADEQ’s PAL renewal
provisions at R18–2–412(I)(1) must
contain a reference to subsection (D) of
R18–2–412 instead of (F), and R18–2–
(I)(4)(a) must reference subsection (E) of
R18–2–412.
3. Definitions
ADEQ’s submittal contains definitions
applicable to the nonattainment NSR
program that do not fully meet the
requirements of 40 CFR 51.165(a)(1),
which requires each State plan to
contain specific definitions for the
nonattainment NSR program. Deviations
from the wording are approvable if the
State specifically demonstrates that the
submitted definition is more stringent,
or at least as stringent, in all respects as
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the corresponding definition in 40 CFR
51.165(a)(1). We have carefully
reviewed the definitions used in
ADEQ’s nonattainment NSR program as
compared with the federal PSD
definitions in 40 CFR 51.165(a)(1) and
have found that generally, ADEQ’s
submittal contains the definitions
necessary to implement a NA–NSR
program. However, a number of ADEQ’s
definitions do not meet the
requirements of 40 CFR 51.165(a)(1)
because their wording deviates from the
wording in the corresponding federal
regulatory definitions in 40 CFR
51.165(a)(1) in a manner that may be
less stringent than the federal
definitions, and the State has not
demonstrated otherwise.
Stationary source at 40 CFR
51.165(a)(1)(i)—the federal regulation at
40 CFR 51.165(a)(1)(i) defines this term
as ‘‘any building, structure, facility or
installation which emits or may emit a
regulated NSR pollutant,’’ with
‘‘regulated NSR pollutant’’ also being a
federally defined term at 40 CFR
51.165(a)(1)(xxxvii), whereas ADEQ’s
regulation at R18–2–101(139) defines
‘‘stationary source’’ as ‘‘any building,
structure, facility or installation subject
to regulation pursuant to A.R.S. § 49–
426(A) which emits or may emit any air
pollutant,’’ with ‘‘air pollutant’’ being
an undefined term in ADEQ’s
regulation. However, A.R.S. § 49–426(A)
provides a cross-reference to certain
exemptions from permitting identified
in A.R.S. § 49–426(B), specifically
agricultural equipment used in normal
farm operations and certain fuel burning
equipment, which do not appear to be
consistent with federal NA–NSR
definition. The federal definition of
stationary source at 40 CFR
51.165(a)(1)(i) is very broad and does
not exclude these source categories from
the definition. We agree that it is
acceptable for ADEQ to limit its NSR
program to certain kinds of stationary
sources, as discussed in detail above
with respect to 40 CFR 51.160(e), but
the federal definition for a stationary
source in the context of the major NA–
NSR program is not the appropriate
place for such an exclusion, as it does
not allow exclusions for certain source
categories. ADEQ must demonstrate that
its definition of stationary source is at
least as stringent as the federal
definition at 40 CFR 51.165(a)(1)(i) in all
respects.
Major stationary source at 40 CFR
51.165(a)(1)(iv)—language from
subparagraph 40 CFR
51.165(a)(1)(iv)(A)(3) not included in
the definition at R18–2–101(75); also see
comments above on definition of
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‘‘stationary source’’ in 40 CFR
51.165(a)(1)(i).
Net emissions increase at 40 CFR
51.165(a)(1)(vi)—The requirement of
paragraph 40 CFR 51.165(a)(1)(vi)(E)(3)
is not met because not all requirements
to be approved under subpart I are listed
(i.e., R18–2–302.01) in the definition at
R18–2–101(87). In addition, the
equivalent of paragraph 40 CFR
51.165(a)(1)(vi)(G) is not included in
ADEQ’s definition at R18–2–101(87).
Significant at 40 CFR 51.165(a)(1)(x)—
ADEQ’s definition at R18–2–101(130)(b)
refers to R18–2–405 for determining
significant emissions in serious and
severe ozone nonattainment areas. The
definition for ‘‘significant’’ at R18–2–
405(B) does not use the term ‘‘net
emissions increase,’’ which is a term
defined by the federal regulations at 40
CFR 51.165(a)(1)(vi).
Allowable emissions at 40 CFR
51.165(a)(1)(xi)—ADEQ’s definition at
R18–2–101(13)(b) does not include the
‘‘future compliance date’’ language that
is in 40 CFR 51.165(a)(1)(xi)(B) and (C)
and ADEQ has not demonstrated that its
regulatory language is at least as
stringent as the federal definition.
Federally enforceable at 40 CFR
51.165(a)(1)(xiv)—ADEQ’s definition at
R18–2–101(53)(d) identifies that
requirements included in permits
pursuant to R18–2–306.01 or R18–2–
306.02 are included in the definition of
federally enforceable requirements, but
excludes those requirements that are
identified as ‘‘enforceable only by the
state.’’ With this action, we are
approving R18–2–306.01 and R18–2–
306.02 into the SIP, making
requirements pursuant to these rules
federally enforceable. As such, ADEQ
does not have the discretion to identify
some of those requirements as only
enforceable by the state.
Regulated NSR pollutant at 40 CFR
51.165(a)(1)(xxxvii)—ADEQ’s definition
is missing this language from paragraph
40 CFR 51.165(a)(1)(xxxvii)(C):
‘‘provided that such constituent or
precursor pollutant may only be
regulated under NSR as part of
regulation of the general pollutant’’ at
R18–2–101(122)(a).
Projected actual emissions at 40 CFR
51.165(a)(1)(xxviii)—ADEQ’s definition
at R18–2–401(20)(b)(iii) does not
specifically require inclusion of
emissions from malfunctions in the
determination of projected actual
emissions, and exempts emissions from
a shutdown associated with a
malfunction from such determination,
while the federal definition at 40 CFR
51.165(a)(1)(xxxvii)(C) requires that
emissions from both shutdowns and
malfunctions be included.
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4. Definition for Basic Design Parameter
ADEQ’s submittal contains a
definition for basic design parameter at
R18–2–401(3) that reflects the definition
that EPA originally developed as part of
its Equipment Replacement Provisions.
See 68 FR 61248, Oct. 27, 2003.
However, the definition for basic design
parameter, and other elements related to
the Equipment Replacement Provisions,
were vacated by the DC Circuit Court of
Appeals in State of New York v. EPA,
443 F.3d 880 (D.C. Cir. 2006). While the
federal NA–NSR regulations still
contain a reference to ‘‘basic design
parameter,’’ this term is no longer
specifically defined under the federal
NA–NSR regulations, and application of
the definition contained in the
Equipment Replacement Provisions that
were vacated by the Court of Appeals is
inconsistent with federal NA–NSR
requirements. As the Court of Appeals
found this Equipment Replacement
Provisions and, therefore, this
definition, impermissible, and because
ADEQ’s regulation incorporating this
definition is a separable portion of
ADEQ’s NA–NSR program, we are
proposing a partial disapproval of
ADEQ’s submitted NA–NSR program, to
disapprove R18–2–401(3).
5. Additional Provisions for Particulate
Matter Nonattainment Areas
On January 4, 2013, the U.S. Court of
Appeals for the District of Columbia
Circuit, in Natural Resources Defense
Council v. EPA,20 issued a decision that
remanded the EPA’s 2007 and 2008
rules implementing the 1997 PM2.5
NAAQS. EPA’s 2008 implementation
rule addressed by the court decision,
‘‘Implementation of New Source Review
(NSR) Program for Particulate Matter
Less Than 2.5 Micrometers (PM2.5)’’ (the
2008 NSR PM2.5 Rule),21 promulgated
NSR requirements for implementation
of PM2.5 in both nonattainment areas
(under the NA–NSR program) and
attainment/unclassifiable areas (under
the PSD program). The Court of Appeals
found that EPA erred in implementing
the PM2.5 NAAQS in these rules for
nonattainment areas solely pursuant to
the general implementation provisions
of subpart 1 of part D of title I of the
CAA, rather than pursuant to the
additional implementation provisions
specific to particulate matter
nonattainment areas in subpart 4. The
Court of Appeals ordered the EPA to
‘‘repromulgate these rules pursuant to
Subpart 4 consistent with this opinion.’’
706 F.3d at 437. Although the Court of
20 706
21 73
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Appeals declined to establish a deadline
for EPA’s response to the remand, EPA
intends to promulgate new generally
applicable implementation regulations
for the PM2.5 NAAQS in accordance
with the requirements of subpart 4. In
the interim, however, states and EPA
still need to proceed with
implementation of the PM2.5 NAAQS in
a timely and effective fashion in order
to meet statutory obligations under the
CAA and to assure the protection of
public health intended by those
NAAQS.
ADEQ’s NSR SIP submittal generally
includes requirements for the PM2.5
NA–NSR program consistent with the
provisions promulgated in the 2008
NSR PM2.5 Rule. Specifically, ADEQ’s
NSR SIP submittal includes the PM2.5
significant emission rates at R18–2–
101(130), regulation of certain PM2.5
precursors (SO2 and NOX) at R18–2–
101(130), the regulation of PM10 and
PM2.5 condensable emissions at R18–2–
101(122)(f), and the emissions offset
requirements at R18–2–403(A)(3).
Separate and aside from the issues
identified above that have resulted in
our proposing limited approval and
limited disapproval of ADEQ’s NA–NSR
submittal, EPA has determined that it is
not prepared at this time to grant full
approval to ADEQ’s NSR SIP submittal
as to the PM2.5 NA–NSR program
requirements, in light of the Court’s
remand of the 2008 NSR PM2.5 Rule, and
for the reasons explained below.
EPA is in the process of evaluating the
requirements of subpart 4 as they
pertain to NA–NSR. In particular,
subpart 4 includes section 189(e) of the
CAA, which requires the control of
major stationary sources of PM10
precursors (and hence under the court
decision, PM2.5 precursors) ‘‘except
where the Administrator determines
that such sources do not contribute
significantly to PM–10 levels which
exceed the standard in the area.’’
Although ADEQ’s NSR SIP submittal
does include regulation of SO2 and NOX
as PM2.5 precursors, it does not include
the regulation of VOCs or ammonia. Nor
does the NSR SIP submittal include a
demonstration as to whether or not the
regulation of VOCs or ammonia is
necessary under section 189(e). The
evaluation of which precursors need to
be controlled to achieve the standard in
a particular area is typically conducted
in the context of the state’s preparing
and the EPA’s reviewing an area’s
attainment plan SIP. In this case, there
are two designated PM2.5 nonattainment
areas in Arizona, the Nogales (portion of
Santa Cruz County, AZ) and West
Central Pinal (portion of Pinal County,
AZ) areas. Both are designated
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nonattainment for the 2006 annual
PM2.5 NAAQS. However, on January 7,
2013 and September 4, 2013, EPA
finalized determinations of attainment
for these areas, respectively (78 FR 887
and 78 FR 54394), which suspended the
requirement for the state to submit,
among other things, an attainment plan
SIP for the area.22 Accordingly, PM2.5
attainment plans for SIP approval are
not currently before Region 9 for these
areas. As Region 9 does not have before
it the state’s analysis as to which
precursors need to be controlled in
these areas pursuant to section 189(e) of
the Act, as would be generally
contained in an attainment plan SIP, it
cannot fully approve as complying with
the CAA a nonattainment NSR SIP that
only addresses a subset of the scientific
PM2.5 precursors recognized by EPA.
On the other hand, while ADEQ’s
submittal may not yet contain all of the
elements necessary to satisfy the CAA
requirements when evaluated under
subpart 4, the NA–NSR SIP submittal
represents a considerable strengthening
of the currently approved Arizona SIP,
which does not address NSR permitting
for PM2.5 at all. Therefore, EPA is
proposing to grant limited approval to
the PM2.5 NA–NSR provisions in
ADEQ’s NSR submittal for the Nogales
and West Central Pinal PM2.5
nonattainment areas.
For the reasons explained above, EPA
is not evaluating at this time whether
ADEQ’s NA–NSR submittal will require
additional revisions relating to PM2.5 to
satisfy the subpart 4 requirements. Once
EPA re-promulgates the Federal PM2.5
regulations with respect to NA–NSR
permitting in response to the Court’s
remand, EPA will consider whether a
limited disapproval should also be
proposed for ADEQ’s PM2.5 NA–NSR
program based on this issue.
In addition, section 189(e) of the CAA
requires that ADEQ’s NSR program for
PM10 nonattainment areas apply to
major stationary sources of PM10
precursors, except where the
Administrator determines that such
sources do not contribute significantly
to PM10 levels which exceed the
standard in the area. As discussed
below, we have identified one area
under ADEQ’s jurisdiction, the West
Pinal PM10 nonattainment area, for
which we are proposing a limited
approval with respect to PM10 under
section 189(e) of the Act.
On September 4, 2013, the West Pinal
area was redesignated to nonattainment
for the 1987 p.m.10 standard. ADEQ’s
22 Prior to the Court’s decision, EPA would not
have reviewed PM2.5 attainment plan submittals for
compliance with Section 189.
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NSR SIP submittal generally includes
NA–NSR requirements for PM10
nonattainment areas such as the PM10
significant emission rate at R18–2–
101(130), the regulation of PM10 and
PM2.5 condensable emissions at R18–2–
101(122)(f), and the emissions offset
requirements at R18–2–403(A)(3).
However, separate and aside from the
issues identified above that have
resulted in our proposing limited
approval and limited disapproval of
ADEQ’s NA–NSR submittal, EPA has
determined that it is not prepared at this
time to grant full approval to ADEQ’s
NSR SIP submittal as to the PM10
nonattainment NSR program
requirements for the West Pinal
nonattainment area. The evaluation of
which precursors need to be controlled
to achieve the standard in a particular
area is typically conducted in the
context of the state’s preparing and the
EPA’s reviewing of an area’s attainment
plan SIP. On February 19, 2014, ADEQ
withdrew from EPA’s consideration the
Arizona State Implementation Plan
Revision for the West Pinal County PM10
Nonattainment Area (submitted on
December 30, 2013). Accordingly, a
PM10 attainment plan for West Pinal is
not currently before Region 9. As such,
Region 9 does not have before it the
state’s analysis as to which precursors
need to be controlled in this area
pursuant to section 189(e) of the Act, as
would be generally contained in an
attainment plan SIP, and cannot fully
approve as complying with the CAA a
nonattainment NSR SIP that does not
address scientific PM10 precursors
recognized by EPA.
While ADEQ’s submittal may not yet
contain all of the elements necessary to
satisfy the CAA NA–NSR requirements
when evaluated under subpart 4, the
proposed revisions to ADEQ’s NA–NSR
program represent a considerable
strengthening of the currently approved
Arizona SIP, which does not address
NSR requirements for PM10 at all.
Therefore, EPA is proposing to grant
limited approval to the PM10 NA–NSR
provisions in ADEQ’s NSR submittal as
they apply to the West Pinal
nonattainment area. Once ADEQ
submits a new PM10 attainment plan for
this area, EPA will consider whether a
limited disapproval should also be
proposed based on this issue.
E. Review of Non-NSR Related Rules
and Statutory Provisions
In addition to ADEQ’s NSR SIP
submittal, we are taking action on rules
R18–2–311 and R18–2–312. These rules
were submitted to EPA for SIP approval
in a separate submittal on July 28, 2011.
We delayed acting on rules R18–2–311
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and R18–2–312 in a previous action,
and are therefore now evaluating and
taking action on the rules. We are also
taking action on A.R.S. § 49–107, an
Arizona statutory provision concerning
local delegation of state authority.
First, ADEQ’s rule R18–2–311
specifies the test methods and
procedures which can be used to
determine compliance with
requirements established under ADEQ’s
air program. On October 19, 1984, EPA
approved an earlier version of this rule
into the SIP.23 See 49 FR 41026. The
current submittal, adopted effective
November 15, 1993, renumbers the
earlier rule and expands on the previous
version by listing additional test
methods that may be used to determine
compliance. While the current rule
improves on the earlier version, we
cannot recommend it for full approval
into the SIP. We are proposing a limited
disapproval because Section D of the
rule allows the State to approve
alternatives to the applicable SIP
without EPA approval, in conflict with
the requirements of CAA sections
110(a)(2)(A) and 110(i).24
Second, ADEQ’s rule R18–2–312
requires stationary sources to conduct a
performance test within 60 days of
achieving the capability to operate at its
maximum production rate, but no later
than 180 days after initial start-up. The
rule also specifies that testing shall be
conducted under such conditions
specified by State, including, but not
limited to appropriate test methods,
notification to the State, data reduction,
records, and number of test runs. On
April 23, 1982 (47 FR 17485) EPA
approved a version of this rule into the
SIP.25 The current submittal, adopted
effective November 15, 1993, renumbers
the earlier rule and expands on the
previous version by including
conditions when a test may be stopped
and allows compliance to be determined
with continuous emission monitoring as
long as the applicable quality assurance
procedures are followed. While the
current rule improves on the earlier
version, we cannot recommend it for
full approval into the SIP. We are
proposing a limited disapproval because
Section B of the rule allows the State to
approve the use of equivalent and
alternative test methods without EPA
approval, in conflict with CAA sections
110(a)(2)(A) and 110(i).26
23 The
rule was previously numbered R9–3–310.
e.g., ‘‘Guidance Document for Correcting
VOC Rule Deficiencies,’’ U.S. EPA Region 9, April
1991, revised August 21, 2001 (Little Bluebook).
25 The rule was previously numbered R9–3–312.
26 See, e.g., Little Bluebook.
24 See,
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Third, A.R.S. § 49–107 is the current
Arizona state law that provides ADEQ
with authority to ‘‘delegate to a local
environmental agency, county health
department, public health services
district or municipality any functions,
powers or duties which the director
believes can be competently, efficiently
and properly performed by the local
agency if the local agency accepts the
delegation and agrees to perform the
delegated functions, powers and duties
according to the standards of
performance required by law and
prescribed by the director,’’ and other
related authorities. This statutory
provision establishes that ADEQ has
clear authority to delegate various
functions under the CAA, including
NSR permitting, to county and other
local government agencies and, as such,
we find it to be approvable and propose
to approve it into the SIP. This
provision will replace 7–1–8.3(R9–3–
803)—Delegation of Authority, an older
ADEQ currently in the SIP, which we
are proposing to remove from the SIP as
part of this action.
F. Review of Rules and Statutory
Provisions Requested To Be Removed
From the SIP
In Table 2 of this preamble we
identify the rules and statutory
provisions we are proposing to remove
or supersede from the SIP as part of this
action. ADEQ’s existing SIP-approved
NSR rules are generally outdated, as we
have not acted to approve substantial
revisions to ADEQ’s NSR rules since the
1980s. Further, the ADEQ NSR rules
currently in the SIP have been repealed
for purposes of State law by ADEQ.
Significant changes have been made to
the Act and the underlying
implementing federal NSR regulations
since our last substantial action on
ADEQ’s NSR SIP. Therefore, replacing
the existing, outdated NSR SIP rules
with the updated ADEQ rules in this
submittal that we propose to approve
into the SIP is appropriate and generally
serves as an overall strengthening of
Arizona’s SIP. In some cases, we
approved updated versions of these
rules into the SIP in previous
rulemaking actions, and a few of the
rules proposed for removal are no longer
necessary for other reasons. Our TSD
provides additional detail.
G. Do the rules meet the evaluation
criteria under Section 110(l) and 193 of
the Act?
CAA Section 110(l) states: ‘‘Each
revision to an implementation plan
submitted by a State under this chapter
shall be adopted by such State after
reasonable notice and public hearing.
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The Administrator shall not approve a
revision of a plan if the revision would
interfere with any applicable
requirement concerning attainment and
reasonable further progress (as defined
in section 7501 of this title), or any
other applicable requirement of this
chapter.’’
With respect to the procedural
requirements of CAA section 110(l),
based on our review of the public
process documentation included in the
July 28, 2011, October 29, 2012 and July
2, 2014 submittals, we find that ADEQ
has provided sufficient evidence of
public notice and opportunity for
comment and public hearings prior to
submittal of this SIP revision and has
satisfied these procedural requirements
under CAA section 110(l).
With respect to the substantive
requirements of section 110(l), as
discussed further below, we have
determined that our approval of the
ADEQ NSR SIP Submittal and the other
rules and statutory provisions that we
are proposing to act on in this action
(including but not limited to the
rescission of numerous existing NSR SIP
rules), as described above in this
preamble, would strengthen the
applicable SIP in most respects. Taken
in its entirety, we find that the SIP
revision represents a strengthening of
ADEQ’s minor NSR, PSD, and NA–NSR
programs as compared to the existing
SIP-approved NSR program for ADEQ
that was last substantially revised in the
SIP in the early 1980s, and that our
approval of this SIP submittal would not
interfere with any applicable
requirement concerning attainment and
reasonable further progress (RFP) or any
other applicable requirement of the Act.
First, this proposed action would
correct a number of deficiencies in
ADEQ’s current SIP-approved NSR
program. ADEQ’s existing SIP-approved
program does not currently contain
these significant program elements: (1)
Implementation of NSR requirements
for PM10; (2) implementation of NSR
requirements for PM2.5; (3) regulation of
NOX as a precursor to ozone; (4)
inclusion of condensable particular
matter in NSR permitting for
determining PM10 and PM2.5 emissions;
and (5) ensuring that the construction or
modification of certain non-major
sources and non-major modifications
will (1) not interfere with attainment or
maintenance of the NAAQS and (2)
comply with the applicable SIP.
Further, ADEQ has also updated its
program to provide for additional
permitting flexibilities that have been
added to the federal NSR program, such
as PALs and the 2002 NSR Reforms.
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Second, most of the deficiencies
identified with the ADEQ rule
provisions on which we are taking
action fit into one of two categories: (1)
Deficiencies that relate to an NSR
program element that has been added
since ADEQ’s NSR program was
approved into the SIP (e.g., the
deficiency related to the omission of the
definition for major emissions unit in
the PALs provisions), or (2) deficiencies
that exist in the current SIP that were
not identified as deficiencies when the
provisions were approved into the SIP
(e.g., ensuring protection of the NAAQS
in areas outside of Arizona from
stationary source emissions regulated
under the NSR program). Therefore, in
considering whether our proposed
approval of the NSR SIP submittal will
interfere with attainment or reasonable
further progress, we only consider those
deficiencies in the first category, as the
deficiencies in the second category are
already a part of the current applicable
requirements for attainment and RFP in
the Arizona SIP. In many cases, the
deficiencies in the second category
occurred because of the numerous
changes to the NSR program since
ADEQ’s NSR rules were last approved
into the SIP. That is, language that may
have been approvable previously is no
longer approvable.
The most significant deficiency that
we have identified, as discussed in
detail above in this notice, is the
absence of provisions that ensure
protection of the 2012 PM2.5 NAAQS for
the PSD program. This deficiency is the
most likely to affect the substantive
requirements of the overall application
of the PSD program, compared to other
deficiencies that we do not expect
would significantly affect the review of
emission impacts (e.g., administrative
requirements for permit issuance).
However, the 2012 PM2.5 NAAQS came
into effect after ADEQ submitted the
NSR SIP submittal to EPA. In addition,
although such standard is currently
applicable in the context of the PSD
program, the implementation
requirements for this standard are not
due until 2016. Accordingly, there are
no applicable requirements in the
existing ADEQ SIP-approved NSR
program related to this NAAQS that
would be affected by the deficiencies in
the submitted NSR rules we are
approving.
In addition, ADEQ has relaxed its
definition of ‘‘major stationary source.’’
ADEQ’s previous definition applied the
PSD and NA–NSR program
requirements to existing non-major
sources when a project would cause
such a stationary source to become a
‘‘major stationary source.’’ ADEQ
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revised its program to instead subject
existing non-major sources to the major
NSR program only if the project
constitutes a ‘‘major stationary source’’
in and of itself, consistent with federal
NSR program requirements. We do not
find this relaxation to interfere with
attainment or reasonable further
progress because ADEQ is also
strengthening its minor NSR program to
address emissions from larger
modifications that do not qualify as
major modifications under ADEQ’s
revised NSR program. While these
modifications would no longer be
subject to the major NSR program,
ADEQ’s minor NSR program would
nonetheless apply and ensure the
modification does not interfere with
attainment or RFP.
In summary, we find that, on balance,
the improvements ADEQ is making to
its NSR program and other portions of
the SIP that are the subject of this
section outweigh the deficiencies
discussed above as compared to ADEQ’s
existing SIP-approved NSR program. In
addition, we are unaware of any
reliance by ADEQ on the continuation
of any specific aspect of the permitrelated rules currently in the ADEQ
portion of the Arizona SIP for the
purpose of continued attainment or
maintenance of the NAAQS. Given all
these considerations, we propose to
conclude that our approval of the ADEQ
regulations and statute that are the
subject of this action into the Arizona
SIP would not interfere with any
applicable requirement concerning
attainment and RFP or any other
applicable requirement of the Act.27
Conclusion. For the reasons set forth
above, we can approve the ADEQ SIP
revision as proposed in this action
under section 110(l) of the Act.
Section 193 of the Act, which was
added by the CAA Amendments of
1990, includes a savings clause that
provides, in pertinent part: ‘‘No control
requirement in effect, or required to be
adopted by an order, settlement
agreement, or plan in effect before
November 15, 1990, in any area which
is a nonattainment area for any air
pollutant may be modified after
27 Our analysis and conclusion here also apply to
our approval of R18–2–311 and R18–2–312, which
are not generally related to NSR permitting. We
note that these rules do not contain any substantive
changes in the procedures for performance tests or
test methods as compared with the analogous rules
in the current SIP. Similarly, our analysis and
conclusion here also extends to our approval of
A.R.S. § 49–107 into the SIP. The provisions in this
state statute relate specifically to local delegation of
state authority and thus would not interfere with
any applicable requirement concerning attainment
and RFP or any other applicable requirement of the
Act.
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November 15, 1990, in any manner
unless the modification insures
equivalent or greater emission
reductions of such air pollutant.’’
We find that the provisions included
in ADEQ’s NSR SIP submittal would
ensure equivalent or greater emission
reductions compared to the SIPapproved NSR program in the
nonattainment areas under ADEQ’s
jurisdiction. In particular, the NSR
provisions in ADEQ’s NSR SIP
submittal cover stationary sources in
areas that are nonattainment for the
PM10, PM2.5 and 1-hr SO2 NAAQS.
ADEQ’s current SIP-approved NSR
program was approved prior to EPA
establishing these NAAQS and the
current NSR provisions in the SIP do
not reference the current, recently SIPapproved Arizona air quality standards
that are comparable to these NAAQS. In
addition, ADEQ’s updated NSR rules
and our action to approve them into the
SIP will expand ADEQ’s review of
minor sources in nonattainment areas to
require review of smaller sources. We
therefore conclude that ADEQ’s NSR
SIP submittal will provide for
equivalent or greater emissions
reductions as compared to the existing
SIP-approved ADEQ NSR program for
the nonattainment pollutants PM10,
PM2.5 and SO2.
Conclusion. For the reasons set forth
above, we can approve the submitted
NSR program under section 193 of the
Act.
H. 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 NSR SIP
submittal. 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 ADEQ’s
jurisdiction in Arizona. In addition, we
are also proposing to remove the
existing statutes and rules listed in
Table 2 from the SIP, which are
outdated and mostly being superseded
by our proposed action. As discussed
above, we are proposing a partial
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disapproval of two elements of ADEQ’s
program, which have been vacated from
the PSD program (and is one case also
from the NA–NSR program) by the
courts. We are also proposing a limited
approval of ADEQ’s nonattainment NSR
program for the Nogales and West
Central Pinal PM2.5 nonattainment areas
and the West Pinal PM10 nonattainment
area under section 189(e) of the Act.
Finally, we are proposing a limited
approval and limited disapproval of two
ADEQ rules relating to test methods and
procedures and performance tests, and
proposing to approve into the SIP an
Arizona statutory provision relating to
local delegation of state authority.
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
ADEQ portion of the Arizona SIP that
govern preconstruction review and the
issuance of preconstruction permits for
stationary sources, including the 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 ADEQ regulations listed in
Table 1, above, as a revision to the
ADEQ portion of the Arizona SIP. We
are also proposing to remove the
existing statutes and rules listed in
Table 2 from the SIP, which are
outdated and mostly being superseded
by our proposed action. In addition, we
are also proposing to partially
disapprove two provisions of ADEQ’s
NSR program that have been vacated by
the courts. We are proposing a limited
approval of ADEQ’s nonattainment NSR
program in certain nonattainment areas
under section 189 of the Act related to
PM10 and PM2.5 precursors. Finally, we
are proposing a limited approval and
limited disapproval of two ADEQ rules
relating to test methods and procedures
and performance tests, and proposing to
approve into the SIP an Arizona
statutory provision relating to local
delegation of state authority.
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 our
proposed limited approval and limited
disapproval action is to update the
applicable SIP with current ADEQ
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regulations and to set the stage for
remedying deficiencies in these
regulations.
If finalized as proposed, our limited
disapproval action would trigger an
obligation on EPA to promulgate a
Federal Implementation Plan unless the
State of Arizona 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 ADEQ
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 Arizona submits and we
approve, prior to the implementation of
the sanctions, SIP revisions that correct
the deficiencies that we identify in our
final action. The EPA intends to work
with ADEQ to correct the deficiencies
identified in this action in a timely
manner.
We will accept comments from the
public on this proposed action for the
next 30 days.
IV. Incorporation by Reference
In this rule, the EPA is proposing to
include in a final EPA rule regulatory
text that includes incorporation by
reference. In accordance with
requirements of 1 CFR 51.5, the EPA is
proposing to incorporate by reference
the ADEQ rules and Arizona statutory
provisions listed in Table 1 of this
preamble. The EPA has made, and will
continue to make, these documents
generally available electronically
through www.regulations.gov and/or in
hard copy at the appropriate EPA office
(see the ADDRESSES section of this
preamble for more information).
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V. Statutory and Executive Order
Reviews
A. Executive Order 12866: Regulatory
Planning and Review and Executive
Order 13563: Improving Regulation and
Regulatory Review
This proposed action is not a
‘‘significant regulatory action’’ under
the terms of Executive Order 12866 (58
FR 51735, October 4, 1993) and is
therefore not subject to review under
Executive Orders 12866 and 13563 (76
FR 3821, January 21, 2011).
B. Paperwork Reduction Act
This action does not impose an
information collection burden under the
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provisions of the Paperwork Reduction
Act, 44 U.S.C. 3501 et seq. Burden is
defined at 5 CFR 1320.3(b).
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA)
generally requires an agency to conduct
a regulatory flexibility analysis of any
rule subject to notice and comment
rulemaking requirements unless the
agency certifies that the rule will not
have a significant economic impact on
a substantial number of small entities.
Small entities include small businesses,
small not-for-profit enterprises, and
small governmental jurisdictions.
This rule will not have a significant
impact on a substantial number of small
entities because SIP approvals or
disapprovals under section 110 and
subchapter I of the Clean Air Act do not
create any new requirements but simply
approve or disapprove requirements
that the State is already imposing.
Therefore, because EPA’s proposed
limited approval/limited disapproval
does not create any new requirements,
I certify that this action will not have a
significant economic impact on a
substantial number of small entities.
Moreover, due to the nature of the
Federal-State relationship under the
Clean Air Act, preparation of flexibility
analysis would constitute Federal
inquiry into the economic
reasonableness of State action. The
Clean Air Act forbids EPA to base its
actions concerning SIPs on such
grounds. Union Electric Co., v. U.S.
EPA, 427 U.S. 246, 255–66 (1976); 42
U.S.C. 7410(a)(2).
D. Unfunded Mandates Reform Act
Title II of the Unfunded Mandates
Reform Act of 1995 (UMRA), 2 U.S.C.
1531–1538, requires Federal agencies,
unless otherwise prohibited by law, to
assess the effects of their regulatory
actions on State, local, and tribal
governments and the private sector.
Federal agencies must also develop a
plan to provide notice to small
governments that might be significantly
or uniquely affected by any regulatory
requirements. The plan must enable
officials of affected small governments
to have meaningful and timely input in
the development of EPA regulatory
proposals with significant Federal
intergovernmental mandates and must
inform, educate, and advise small
governments on compliance with the
regulatory requirements.
This proposed rule 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 in any one year. Thus,
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this rule is not subject to the
requirements of section 202 or 205 of
UMRA. This Federal action proposes to
approve and disapprove pre-existing
requirements under State or local law,
and imposes no new requirements.
This proposed 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. This
proposed rule does not impose
regulatory requirements on any
government entity.
E. Executive Order 13132, Federalism
This 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 in the
distribution of power and
responsibilities among the various
levels of government, as specified in
Executive Order 13132. In the spirit of
Executive Order 13132, and consistent
with EPA policy to promote
communications between EPA and State
and local governments, EPA specifically
solicits comment on this proposed
action from State and local officials.
F. Executive Order 13175, Coordination
With Indian Tribal Governments
Under Executive Order 13175 (65 FR
67249, November 9, 2000), EPA may not
issue a regulation that has tribal
implications, that imposes substantial
direct compliance costs, and that is not
required by statute, unless the federal
government provides the funds
necessary to pay the direct compliance
costs incurred by tribal governments, or
EPA consults with tribal officials early
in the process of developing the
proposed regulation and develops a
tribal summary impact statement.
This proposed rule does not have
tribal implications, as specified in
Executive Order 13175. Thus, Executive
Order 13175 does not apply to this rule.
EPA specifically solicits additional
comment on this proposed rule from
tribal officials. The SIP is not approved
to apply on any Indian reservation land
or in any other area where EPA or an
Indian tribe has demonstrated that a
tribe has jurisdiction. In those areas of
Indian country, the rule does not have
tribal implications and will not impose
substantial direct costs on tribal
governments or preempt tribal law as
specified by Executive Order 13175.
G. Executive Order 13045, Protection of
Children From Environmental Health
Risks and Safety Risks
EPA interprets Executive Order 13045
(62 FR 19885, April 23, 1997) as
E:\FR\FM\18MRP1.SGM
18MRP1
14062
Federal Register / Vol. 80, No. 52 / Wednesday, March 18, 2015 / Proposed Rules
applying only to those regulatory
actions that concern health or safety
risks, such that the analysis required
under section 5–501 of the Executive
Order has the potential to influence the
regulation. This rule is not subject to
Executive Order 13045, because it
proposes to approve a State rule
implementing a Federal standard.
H. Executive Order 13211, Actions That
Significantly Affect Energy Supply,
Distribution, or Use
This rule is not subject to Executive
Order 13211, ‘‘Actions Concerning
Regulations That Significantly Affect
Energy Supply, Distribution, or Use’’ (66
FR 28355, May 22, 2001) because it is
not a significant regulatory action under
Executive Order 12866.
wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
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 (10) (15 U.S.C. 272 note) directs
EPA to use voluntary consensus
standards (VCS) in its regulatory
activities unless to do so would be
inconsistent with applicable law or
otherwise impractical. VCS are
technical standards (e.g., materials
specifications, test methods, sampling
procedures, and business practices) that
are developed or adopted by the VCS
bodies. The NTTAA directs EPA to
provide Congress, through annual
reports to OMB, with explanations
when the Agency decides not to use
available and applicable VCS. EPA
believes that VCS are inapplicable to
this action. Today’s action does not
require the public to perform activities
conducive to the use of VCS.
J. Executive Order 12898: Federal
Actions To Address Environmental
Justice in Minority Populations and
Low-Income Population
Executive Order (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 has determined that this
proposed rule will not have
disproportionately high and adverse
human health or environmental effects
on minority or low-income populations
VerDate Sep<11>2014
15:03 Mar 17, 2015
Jkt 235001
because it does not change the level of
environmental protection for any
affected populations.
Dated: March 4, 2015.
Jared Blumenfeld,
Regional Administrator, Region IX.
[FR Doc. 2015–06143 Filed 3–17–15; 8:45 am]
BILLING CODE 6560–50–P
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR Part 52
[EPA–R07–OAR–2015–0123; FRL–9924–54–
Region 7]
Approval and Promulgation of
Implementation Plans; State of
Missouri, Construction Permits
Required
Environmental Protection
Agency.
ACTION: Proposed rule.
AGENCY:
The Environmental Protection
Agency (EPA) is proposing to approve
revisions to the State Implementation
Plan (SIP) for the State of Missouri
submitted on October 2, 2013. This
proposed rulemaking will amend the
SIP to update the construction permits
rule to incorporate by reference recent
EPA actions related to plantwide
applicability limitations (PALs) for
greenhouse gases (GHGs) and to correct
the definition of ‘‘regulated NSR
pollutant.’’ Other revisions include
modifying the notification period for
initial equipment start-up and clarifying
de minimis permit air quality analysis
requirements.
SUMMARY:
Comments must be received on
or before April 17, 2015.
ADDRESSES: Submit your comments,
identified by Docket ID No. EPA–R07–
OAR–2015–0123, by one of the
following methods:
1. www.regulations.gov. Follow the
on-line instructions for submitting
comments.
2. Email: Higbee.paula@epa.gov.
3. Mail or Hand Delivery: Paula
Higbee, Environmental Protection
Agency, Air Planning and Development
Branch, 11201 Renner Boulevard,
Lenexa, Kansas 66219.
Instructions: Direct your comments to
Docket ID No. EPA–R07–OAR–2015–
0123. 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
DATES:
PO 00000
Frm 00033
Fmt 4702
Sfmt 4702
Information (CBI) or other information
whose disclosure is restricted by statute.
Do not submit through
www.regulations.gov or email
information that you consider to be CBI
or otherwise protected. The
www.regulations.gov Web site is an
‘‘anonymous access’’ system, which
means 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 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, 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 EPA
cannot read your comment due to
technical difficulties and cannot contact
you for clarification, 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.
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, i.e., 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 form.
Publicly available docket materials are
available either electronically in
www.regulations.gov or in hard copy at
the Environmental Protection Agency,
Air Planning and Development Branch,
11201 Renner Boulevard, Lenexa,
Kansas 66219. The Regional Office’s
official hours of business are Monday
through Friday, 8:00 to 4:30 excluding
legal holidays. The interested persons
wanting to examine these documents
should make an appointment with the
office at least 24 hours in advance.
FOR FURTHER INFORMATION CONTACT:
Paula Higbee, Environmental Protection
Agency, Air Planning and Development
Branch, 11201 Renner Boulevard,
Lenexa, Kansas 66219 at 913–551–7028
or by email at Higbee.paula@epa.gov.
SUPPLEMENTARY INFORMATION:
Throughout this document ‘‘we,’’ ‘‘us,’’
or ‘‘our’’ refer to EPA. This section
provides additional information by
addressing the following:
I. What is being addressed in this document?
II. Background
III. Have the requirements for approval of a
SIP revision been met?
E:\FR\FM\18MRP1.SGM
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]]>Agencies
[Federal Register Volume 80, Number 52 (Wednesday, March 18, 2015)]
[Proposed Rules]
[Pages 14044-14062]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-06143]
-----------------------------------------------------------------------
ENVIRONMENTAL PROTECTION AGENCY
40 CFR part 52
[EPA-R09-OAR-2015-0187; FRL-9924-48-Region 9]
Revisions to Air Plan; Arizona; Stationary Sources; New Source
Review
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: The Environmental Protection Agency (EPA) is proposing a
limited approval and limited disapproval of revisions to the Arizona
Department of Environmental Quality (ADEQ) portion of the applicable
state implementation plan (SIP) for the State of Arizona. These
revisions are primarily intended to serve as a replacement of ADEQ's
existing SIP-approved rules for the issuance of New Source Review (NSR)
permits for stationary sources, including but not limited to review and
permitting of major sources and major modifications under the Clean Air
Act (CAA or Act). After a lengthy stakeholder process, the State of
Arizona developed and submitted a NSR program for SIP approval that
satisfies most of the applicable Clean Air Act and NSR regulatory
requirements, and will significantly update ADEQ's existing SIP-
approved NSR program. It also represents an overall strengthening of
ADEQ's SIP-approved NSR program by clarifying and enhancing the NSR
permitting requirements for major and minor stationary sources. This
proposed action will update the applicable plan and set the stage for
remedying certain deficiencies in these rules. We are seeking comment
on our proposed action and plan to follow with a final action.
DATES: Any comments must arrive by April 17, 2015.
ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2015-0187, by one of the following methods:
1. Federal eRulemaking Portal: www.regulations.gov. Follow the
online instructions.
2. Email: R9airpermits@epa.gov.
3. Mail or deliver: Gerardo Rios (Air-3), U.S. Environmental
Protection Agency, Region 9, 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. Electronic files should avoid the use of
special characters, any form of encryption, and be free of any defects
or viruses.
Docket: Generally, documents in the docket for this action are
available electronically at www.regulations.gov and in hard copy at EPA
Region 9, 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: Lisa Beckham, EPA Region 9, (415) 972-
3811, beckham.lisa@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 or statutory provisions did the State submit?
B. Are there previous versions of the statutory provisions or
rules in the Arizona SIP?
C. What is the purpose of this proposed rule?
II. EPA's Evaluation
A. How is EPA evaluating the rules and statutory provisions?
B. Do the rules meet the evaluation criteria for Minor New
Source Review?
1. Legally Enforceable Procedures
2. ADEQ's Program Under 40 CFR 51.160(e)
3. Public Availability of Information
4. Administrative Procedures
5. Stack Height Procedures
C. Do the rules meet the evaluation criteria for Prevention of
Significant Deterioration (PSD)?
1. General PSD Program Requirements
2. Restrictions on Area Classifications
3. Redesignations
4. Impacts on Class I Areas
5. Public Participation
6. Plantwide Applicability Limits
7. Definitions
8. PM2.5 Significant Monitoring Concentration
9. Definition for Basic Design Parameter
D. Do the rules meet the evaluation criteria for Nonattainment
New Source Review?
1. General Nonattainment NSR Program Requirements
2. Plantwide Applicability Limits
3. Definitions
4. Definition for Basic Design Parameter
5. Additional Provisions for Particulate Matter Nonattainment
Areas
E. Review of Non-NSR Related Rules and Statutory Provisions
F. Review of Rules and Statutory Provisions Requested To Be
Removed From the SIP
G. Do the rules meet the evaluation criteria under Sections
110(l) and 193 of the Act?
H. Conclusion
III. Public Comment and Proposed Action
IV. Incorporation by Reference
V. Statutory and Executive Order Reviews
Definitions
For the purpose of this document, we are giving meaning to certain
words or initials as follows:
(i) The words or initials Act or CAA mean or refer to the Clean
Air Act, unless the context indicates otherwise.
(ii) The initials ADEQ mean or refer to the Arizona Department
of Environmental Quality.
(iii) The initials A.R.S. mean or refer to the Arizona Revised
Statutes.
(iv) The initials BACT mean or refer to Best Available Control
Technology.
(v) The initials CFR mean or refer to Code of Federal
Regulations.
(vi) The initials CO means or refer to carbon monoxide.
(vii) The words EPA, we, us or our mean or refer to the United
States Environmental Protection Agency.
(viii) The initials FIP mean or refer to Federal Implementation
Plan.
[[Page 14045]]
(ix) The initials GHG mean or refer to greenhouse gas.
(x) The initials IBR mean or refer to incorporation by
reference.
(xi) The initials LAER mean or refer to Lowest Achievable
Emissions Rate.
(xii) The initials NAAQS mean or refer to National Ambient Air
Quality Standards.
(xiii) The initials NA-NSR mean or refer to Nonattainment New
Source Review.
(xiv) The initials NOX mean or refer to nitrogen
oxides.
(xv) The initials NSR mean or refer to New Source Review.
(xvi) The initials PAL mean or refer to Plantwide Applicability
Limits.
(xvii) The initials PM10 mean or refer to particulate
matter with an aerodynamic diameter of less than or equal to 10
micrometers (coarse particulate matter).
(xviii) The initials PM2.5 mean or refer to
particulate matter with an aerodynamic diameter of less than or
equal to 2.5 micrometers (fine particulate matter).
(xix) The initials PSD mean or refer to Prevention of
Significant Deterioration.
(xx) The initials PTE mean or refer to potential to emit.
(xxi) The initials RACT mean or refer to reasonable available
control technology.
(xxii) The initials SIP mean or refer to State Implementation
Plan.
(xxiii) The initials SMC mean or refer to significant monitoring
concentration.
(xxiv) The initials SO2 mean or refer to sulfur
dioxide.
(xxv) The words State or Arizona mean the State of Arizona,
unless the context indicates otherwise.
(xxvi) The initials TSD mean or refer to the technical support
document for this action.
(xxvii) The initials VOC mean or refer to volatile organic
compound.
I. The State's Submittals
A. Which rules or statutory provisions did the State submit?
On July 28, 2011 and October 29, 2012, ADEQ submitted revisions to
the ADEQ portion of the Arizona SIP. On May 16, 2014, ADEQ supplemented
the July 28, 2011 submittal. On September 6, 2013, July 2, 2014, and
February 16, 2015, ADEQ supplemented the October 29, 2012 submittal.
Collectively, these submittals generally comprise ADEQ's current
program for preconstruction review and permitting of new or modified
stationary sources under ADEQ's jurisdiction in Arizona (as described
below).\1\ The NSR SIP revisions that are the subject of this action,
\2\ referred to herein as the ``NSR SIP submittal'' represent a
comprehensive revision to ADEQ'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 under section 110(a)(2)(C)
of the Act.\3\ The preconstruction review and permitting programs are
often collectively referred to as ``New Source Review'' (NSR).
---------------------------------------------------------------------------
\1\ In addition, these submittals and our current action also
address two rules and one statutory provision that are not directly
related to NSR.
\2\ We note that portions of ADEQ's SIP-approved rule R18-2-310,
which provides affirmative defenses for excess emissions during
malfunctions (R18-2-310(B)) and for excess emissions during startup
or shutdown (R18-2-310(C)), are currently the subject of a separate
rulemaking action by EPA. In a 2013 notice of proposed rulemaking,
and a 2014 supplemental notice of proposed rulemaking that revised
certain of the findings described in the 2013 notice, EPA proposed
to find R18-2-310(B) and R18-2-310(C) substantially inadequate to
meet CAA requirements and proposed to issue a SIP call with respect
to these provisions. See 78 FR 12460, 12533-34, Feb. 22, 2013; 79 FR
55920, 55946-47, Sept. 17, 2014. ADEQ's R18-2-310 is not part of the
ADEQ SIP submittal that is under consideration in this action, and
this rule is not being evaluated or otherwise addressed by EPA as
part of our current action on ADEQ's SIP submittal.
\3\ Rules R18-2-301 through R18-2-334 (Article 3 rules) also
contain requirements to address the CAA title V requirements for
operating permit programs, but we are not evaluating these rules for
title V purposes at this time. We will evaluate the Article 3 rules
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 revision submittal from ADEQ.
---------------------------------------------------------------------------
The proposed revisions to the SIP that are subject to this action
cover those areas of Arizona where ADEQ has jurisdiction. Currently,
ADEQ has permitting jurisdiction for the following stationary source
categories in all areas of Arizona: Smelting of metal ores, coal-fired
electric generating stations, petroleum refineries, Portland cement
plants, and portable sources. ADEQ also has permitting jurisdiction for
major and minor sources in the following counties: Apache, Cochise,
Coconino, Gila, Graham, Greenlee, La Paz, Mohave, Navajo, Santa Cruz,
Yavapai, and Yuma. Finally, ADEQ has permitting jurisdiction over major
sources in Pinal County \4\ and the Rosemont Copper Mine in Pima
County.
---------------------------------------------------------------------------
\4\ ADEQ has delegated implementation of the major source
program to the Pinal County Air Quality Control District.
---------------------------------------------------------------------------
Table 1 lists the rules we are proposing for approval in today's
action with the corresponding effective dates and submittal dates. The
submitted rules are from the Arizona Administrative Code, Title 18--
Environmental Quality, Chapter 2--Department of Environmental Quality--
Air Pollution Control, Articles 1, 2, 3, and 4. The submitted statutory
provision is from Title 49 of the Arizona Revised Statutes, Chapter 1,
Article 1.
Table 1--Submitted Statutes and Rules Proposed for Approval in This Action
----------------------------------------------------------------------------------------------------------------
State
Rule or statute Title effective date Submitted
----------------------------------------------------------------------------------------------------------------
A.R.S Sec. 49-107....................... Local delegation of state 08/18/1987 07/2/2014
authority.
R18-2-101 [only definitions (2), (32), Definitions....................... 08/07/2012 10/29/2014
(87), (109), and (122)].
R18-2-217................................. Designation and Classification of 11/15/1993 10/29/2014
Attainment Areas.
R18-2-218................................. Limitation of Pollutants in 08/07/2012 10/29/2014
Classified Attainment Areas.
R18-2-301................................. Definitions....................... 08/07/2012 10/29/2014
R18-2-302................................. Applicability; Registration; 08/07/2012 10/29/2014
Classes of Permits.
R18-2-302.01.............................. Source Registration Requirements.. 08/07/2012 10/29/2014
R18-2-303................................. Transition from Installation and 08/07/2012 10/29/2014
Operating Permit Program to
Unitary Permit Program;
Registration transition; Minor
NSR transition.
R18-2-304................................. Permit Application Processing 08/07/2012 10/29/2014
Procedures.
R18-2-306................................. Permit Contents................... 12/20/1999 10/29/2014
R18-2-306.01.............................. Permits Containing Voluntarily 01/01/2007 10/29/2014
Accepted Emission Limitations and
Standards.
R18-2-306.02.............................. Establishment of an Emissions Cap. 09/22/1999 10/29/2014
R18-2-311................................. Test Methods and Procedures....... 11/15/1993 07/28/2011
[[Page 14046]]
R18-2-312................................. Performance Tests................. 11/15/1993 07/28/2011
R18-2-315................................. Posting of Permit................. 11/15/1993 10/29/2014
R18-2-316................................. Notice by Building Permit Agencies 05/14/1979 10/29/2014
R18-2-319................................. Minor Permit Revisions............ 08/07/2012 10/29/2014
R18-2-320................................. Significant Permit Revisions...... 08/07/2012 10/29/2014
R18-2-321................................. Permit Reopenings; Revocation and 08/07/2012 10/29/2014
Reissuance.
R18-2-323................................. Permit Transfers.................. 02/03/2007 10/29/2014
R18-2-330................................. Public Participation.............. 08/07/2012 10/29/2014
R18-2-332................................. Stack Height Limitation........... 11/15/1993 10/29/2014
R18-2-334................................. Minor New Source Review........... 08/07/2012 10/29/2014
R18-2-401 [excluding definition (3)]...... Definitions....................... 08/07/2012 10/29/2014
R18-2-402................................. General........................... 08/07/2012 10/29/2014
R18-2-403................................. Permits for Sources Located in 08/07/2012 10/29/2014
Nonattainment Areas.
R18-2-404................................. Offset Standards.................. 08/07/2012 10/29/2014
R18-2-405................................. Special Rule for Major Sources of 08/07/2012 10/29/2014
VOC or Nitrogen Oxides in Ozone
Nonattainment Areas Classified as
Serious or Severe.
R18-2-406................................. Permit Requirements for Sources 08/07/2012 10/29/2014
Located in Attainment and
Unclassifiable Areas.
R18-2-407 [excluding subsection (H)(1)(c)] Air Quality Impact Analysis and 08/07/2012 10/29/2014
Monitoring Requirements.
R18-2-409................................. Air Quality Models................ 11/15/1993 10/29/2014
R18-2-412................................. PALs.............................. 08/07/2012 10/29/2014
----------------------------------------------------------------------------------------------------------------
On December 28, 2012, April 29, 2013, and December 2, 2014, ADEQ's
July 28, 2011, October 29, 2012, and July 2, 2014 submittals,
respectively, were deemed complete by operation of law to meet the
completeness criteria in 40 CFR part 51, appendix V, which must be met
before formal EPA review. Each of these submittals includes evidence of
public notice and adoption of the regulation. Our technical support
document (TSD) provides additional background information on each of
the submitted rules.
B. Are there previous versions of the statutory provisions or rules in
the Arizona SIP?
EPA has not approved significant revisions or updates to ADEQ's
SIP-approved NSR program since the 1980s. The existing SIP-approved NSR
program for new or modified stationary sources under ADEQ's
jurisdiction generally consists of the rules identified below in Table
2 that we are proposing to supersede in or delete from the Arizona SIP.
Collectively, these regulations established the NSR requirements for
both major and minor stationary sources under ADEQ jurisdiction in
Arizona, including requirements for the generation and use of emission
reduction credits in nonattainment areas.
Consistent with ADEQ's stated intent to have the submitted NSR
rules replace the existing NSR program in the SIP, EPA's approval of
the regulations identified above in Table 1 generally would have the
effect of superseding our prior approval of the current SIP-approved
NSR program.\5\ Table 2 lists the existing rules in the Arizona SIP
that would be superseded or removed from the Arizona SIP as a result of
our proposed action. If EPA were to take final action as proposed
herein, these rules generally would be replaced in, or otherwise
deleted from, the SIP by the submitted set of rules listed in Table 1.
---------------------------------------------------------------------------
\5\ Except for certain sections that ADEQ requested that we not
remove from the SIP at this time.
Table 2--SIP Rules Superseded or Removed From Arizona SIP in This Action
----------------------------------------------------------------------------------------------------------------
Federal
Rule or statute Title EPA Approval Register
date citation
----------------------------------------------------------------------------------------------------------------
R9-3-101.................................. Definitions....................... Various Various
R9-3-217(B)............................... Attainment Areas: Classification 04/23/1982 47 FR 17486
and Standards.
R9-3-301, [excluding subsections (I), (K)] Installation Permits: General..... 05/03/1983 48 FR 198879
R9-3-302.................................. Installation Permits in 08/10/1988 53 FR 30220
Nonattainment Areas.
R9-3-303.................................. Offset Standards.................. 08/10/1988 53 FR 30220
R9-3-304, [excluding subsection (H)]...... Installation Permits in Attainment 05/03/1983 48 FR 19879
Areas.
R9-3-305.................................. Air Quality Analysis and 05/03/1983 48 FR 19879
Monitoring Requirements.
R9-3-306.................................. Source Registration Requirements.. 05/03/1983 48 FR 19879
R9-3-307.................................. Replacement....................... 05/05/1982 47 FR 19328
R9-3-308.................................. Permit Conditions................. 04/23/1982 47 FR 17485
R9-3-311.................................. Air Quality Models................ 04/23/1982 47 FR 17485
R9-3-314.................................. Excess Emissions Reporting........ 04/23/1982 47 FR 17485
R9-3-315.................................. Posting of Permits................ 04/23/1982 47 FR 17485
[[Page 14047]]
R9-3-316.................................. Notice by Building Permit Agencies 04/23/1982 47 FR 17485
R9-3-317.................................. Permit Non-transferrable; 04/23/1982 47 FR 17485
Exception.
R9-3-318.................................. Denial or Revocation of 04/23/1982 47 FR 17485
Installation or Operating Permit.
R8-3-319.................................. Permit Fees....................... 04/23/1982 47 FR 17485
R9-3-322.................................. Temporary Conditional Permits..... 10/19/1984 49 FR 41026
R9-3-1101................................. Jurisdiction...................... 05/03/1983 48 FR 19879
Appendix 4................................ Fee Schedule for Installation and 09/19/1977 42 FR 16926
Operating Permits.
Appendix 5................................ Fee Schedule for Conditional 09/19/1977 42 FR 46926
Permits.
----------------------------------------------------------------------------------------------------------------
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 rules and statutory provisions
submitted by ADEQ on July 28, 2011, October 29, 2012, and July 2, 2014,
which are identified in Table 1. We provide our reasoning in general
terms below, and include our more detailed analysis in the TSD, which
is available in the docket for this proposed rulemaking.
II. EPA's Evaluation
A. How is EPA evaluating the rules and statutory provisions?
EPA has reviewed the provisions submitted by ADEQ that are the
subject of this action, including those governing NSR for stationary
sources under ADEQ 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 51.166, and the CAA requirements for SIP revisions in
CAA section 110(l) and 193.\6\
---------------------------------------------------------------------------
\6\ 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. CAA section 193, which was added by the CAA
Amendments of 1990, includes a savings clause that provides, in
pertinent part: ``No control requirement in effect, or required to
be adopted by an order, settlement agreement, or plan in effect
before November 15, 1990, in any area which is a nonattainment area
for any air pollutant may be modified after November 15, 1990, in
any manner unless the modification insures equivalent or greater
emission reductions of such air pollutant.''
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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 July 28, 2011, October 29, 2012 and July 2, 2014 submittals, we
find that ADEQ 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 generally
reviewed the ADEQ provisions that are the subject of our current action
in accordance with the CAA and applicable regulatory requirements,
focusing primarily on those that apply to: (1) General preconstruction
review programs, including 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 (NA-NSR). For the most part, ADEQ's submittal
satisfies applicable CAA requirements, specifically including the
applicable requirements for these three preconstruction review programs
and would strengthen the applicable SIP by updating the regulations and
adding requirements to address new or revised NSR permitting and other
requirements promulgated by EPA, but the submitted rules also contain
specific deficiencies that prevent full approval. Below, we discuss
generally our evaluation of ADEQ's submittal and the deficiencies that
are the basis for our proposed action on these rules. Our TSD contains
a more detailed evaluation as well as additional recommendations for
program improvements.
B. Do the rules meet the evaluation criteria for Minor New Source
Review?
Section 110(a)(2)(C) requires each SIP to include a program for the
regulation of the modification and construction of any stationary
source within the areas covered by the plan as necessary to assure
attainment and maintenance of the National Ambient Air Quality
Standards (NAAQS). In addition to the permit programs required under
parts C and D of the CAA for PSD sources and nonattainment NSR sources,
respectively, which are discussed below, EPA's regulations at 40 CFR
51.160-51.164 provide general programmatic requirements to implement
this statutory mandate commonly referred to as the ``minor NSR
program.'' These minor NSR program regulations impose requirements for
SIP approval of State and local programs that are more general in
nature as compared with the specific statutory and regulatory
requirements for PSD and NA-NSR permitting programs. Under EPA's
regulations governing the minor NSR program, States and local air
agencies retain a level of discretion to define the types and sizes of
sources subject to the program, whereas under the PSD and nonattainment
NSR permitting programs, the sources subject to regulation are
specified by EPA regulations. The substantive requirements for the
preconstruction review and permitting of minor stationary sources under
ADEQ jurisdiction are ADEQ rules R18-2-302.01 and R18-2-334. These
rules, and other administrative rules included in the minor NSR portion
of the SIP submittal, satisfy most of the statutory and regulatory
requirements for minor NSR programs, but these rules also contain
several deficiencies that form the basis for our proposed limited
disapproval, as discussed below.
We are proposing a limited approval and limited disapproval of
ADEQ's minor NSR program because it is not fully consistent with the
requirements of 40 CFR 51.160, 40 CFR 51.161, 40 CFR 51.163 and 40 CFR
51.164, as described below. We find that approval
[[Page 14048]]
of ADEQ's updated minor NSR program will substantially strengthen the
SIP overall, as the submitted minor NSR program generally has more
extensive requirements for minor sources and non-major modifications
than ADEQ's current SIP-approved program and lower permitting
thresholds that will provide additional mechanisms for protecting the
NAAQS, as well as updating the SIP with current State regulations for
minor sources and non-major modifications. However, specific provisions
of the minor NSR program submittal are inconsistent with federal minor
NSR program requirements, and these deficiencies must be addressed
before we can fully approve ADEQ's minor NSR program into the SIP. The
deficiencies that we have identified with ADEQ's minor NSR program that
provide the basis for our limited approval and limited disapproval are
described below.
1. Legally Enforceable Procedures
40 CFR 51.160 requires that each NSR program contain certain
legally enforceable procedures. We have identified several deficiencies
with ADEQ's program as it pertains to these requirements.
First, as required by 40 CFR 51.160(a), ADEQ's permitting
procedures are not enforceable in all instances. ADEQ's program allows
certain sources to begin construction when a ``proposed final permit''
is issued by ADEQ, rather than preventing construction until a final
permit has been issued. See R18-2-101(114), R18-2-302(G), R18-2-334(B),
R18-2-402(C). The definition for ``proposed final permit'' in R18-2-101
does not specify that such an action is a final decision for NSR
purposes. As a result, the program does not provide ADEQ with clear
authority to prevent construction or modification before it issues a
final decision on the request for authority to construct as is required
per 40 CFR 51.160(a) and (b). ADEQ has clarified that, in effect, under
ADEQ's rules, a proposed final permit is treated as a final
authorization to construct, and that it will treat proposed final
permit as a final, appealable agency action under Arizona law.\7\
Nevertheless, a revision to ADEQ's NSR program is necessary to ensure
that these types of permit actions clearly serve as a final authority
to construct in order to satisfy the federal NSR program requirement
that the agency be able to prevent construction until and unless it has
issued a final decision on the request for authority to construct.
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\7\ ADEQ Memo--Proposed Final Permits to be Treated as
Appealable Agency Actions, dated February 10, 2015 and ADEQ's
February 23, 20157 supplement at 2.
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Second, ADEQ's program does not contain adequate enforceable
procedures to ensure compliance by sources subject to review under its
NSR program with the NAAQS as required by 40 CFR 51.160(a)(2) and
(b)(2). Although NAAQS is a defined term in ADEQ's regulations, see
R18-2-101(85), ADEQ's NSR program generally does not refer to the NAAQS
and instead generally references the State's ambient air standards in
Article 2 of ADEQ's air program. See R18-2-302.01, R18-2-334, and R18-
2-406.\8\ Also, in some instances, ADEQ's NSR regulations simply refer
to Arizona ambient air quality standards with no specific reference to
Article 2, which makes the applicable standards ambiguous.\9\ See R18-
2-218, R18-2-406, and R18-2-407. In some instances, ADEQ's NSR program
does not ensure that a source would not interfere with attainment or
maintenance of the NAAQS in neighboring areas outside ADEQ's permitting
jurisdiction, as is required under 40 CFR 51.160(a) and (b), as the
State air standards are not generally applicable in neighboring
States,\10\ and the NSR Program submittal does not demonstrate that
they are applicable in neighboring States for purposes of ADEQ's NSR
program. See R18-2-302.01(C); R18-2-334(C)(2), (F), and (G); and R18-2-
406(A)(5)(a) and (b). Also, for minor sources subject to permitting
under R18-2-334, the rule does not meet these federal requirements as
it does not require ADEQ to evaluate whether the project under review
will interfere with attainment or maintenance of the NAAQS in all
cases, and instead allows sources to apply reasonably available control
technology (RACT) in lieu of such an evaluation and, in some cases,
appears to allow sources with lower levels of emissions to avoid both
substantive NAAQS review and RACT requirements. See R18-2-334(C)(1)(a)-
(b). ADEQ has not demonstrated that this approach ensures that all
sources subject to review under its NSR program will not interfere with
attainment or maintenance of the NAAQS. While R18-2-334(G) allows
Director's discretion to require a NAAQS analysis on a case-by-case
basis, we find this discretion too great to ensure compliance with this
requirement. Finally, R18-2-302.01(C)(4) needs to include a reference
to ``or maintenance'' of a standard, instead of just ``attainment of a
standard.''
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\8\ ADEQ's list of state air standards does not contain the
current PM2.5 annual NAAQS of 12 [mu] g/m\3\
PM2.5. See 78 FR 3086, Jan. 13, 2013. This is not a
disapproval issue for ADEQ's minor NSR and NA-NSR programs, which
have three years to adopt programs implementing the new NAAQS.
However, the new NAAQS is applied immediately upon its effective
date to sources subject to the PSD program.
\9\ For example, R18-2-407(B) contains ``any such pollutant for
which no Arizona ambient air quality standard exists.'' ``Arizona
ambient air quality standard'' is not a defined term in ADEQ's
regulations.
\10\ See, for example, the definition of ``attainment area'' in
R18-2-101, limiting attainment areas to those in Arizona. A.R.S.
Sec. 49-106 provides, in relevant part: ``The rules adopted by the
department apply and shall be observed throughout this state, or as
provided by their terms, and the appropriate local officer, council
or board shall enforce them.''
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Third, for sources subject to ADEQ's registration program at R18-2-
302.01, ADEQ has not demonstrated that its NSR program meets the
requirement to ensure that sources subject to NSR review comply with
the applicable portions of the control strategy as required by 40 CFR
51.160(b)(1).
Fourth, ADEQ's registration program in R18-2-302.01 does not
contain enforceable procedures for the owner or operator to submit the
necessary information for ADEQ to determine whether a source will
violate the applicable control strategy or interfere with attainment or
maintenance of the NAAQS as required by 40 CFR 51.160(c). R18-2-
302.01(A)(3) requires applicants to calculate a source's uncontrolled
potential to emit, but then references provisions in another rule, R18-
2-327(C), that are used to calculate ``actual'' emissions. As such,
ADEQ's program contains conflicting procedures for calculating
potential emissions. In addition, rule R18-2-327, is not in the Arizona
SIP, and has not been submitted to EPA for SIP approval.
Fifth, ADEQ's program does not meet the requirement that the
applicant submit information related to the nature and amounts of
emissions, for certain kinds of emissions units as required by 40 CFR
51.160(c)(1). For Class I and Class II permits, R18-2-304(E)(9) allows
sources to avoid providing emission information for ``insignificant
activities,'' as defined in R18-2-101(68). The term ``insignificant
activities'' is generally associated with the title V program. Many of
the activities listed in ADEQ's definition of insignificant activity
are activities that would not be expected to emit regulated NSR
pollutants. However, this is not true for all activities, such as those
listed under R18-2-101(68)(a-c) that include liquid storage tanks,
combustion engines, and ``low-emitting processes.''
Sixth, for sources subject to R18-2-302.01, ADEQ's program does not
meet the requirement in 40 CFR 51.160(d) that its procedures provide
that approval of construction or modification
[[Page 14049]]
will not affect the responsibility of the owner or operator to comply
with applicable portions of the control strategy.
Finally, for sources subject to ADEQ's registration program under
R18-2-302.01, ADEQ's program does not meet the requirement to use
Appendix W to 40 CFR part 51 for air quality modeling as required by 40
CFR 51.160(f)(1).
2. ADEQ's Program Under 40 CFR 51.160(e)
40 CFR 51.160(e) requires ADEQ's submittal to provide a basis for
the types and sizes of facilities, buildings, structures, or
installations that will be subject to review under 40 CFR 51.160. Such
exclusions are appropriate so long as such sources and modifications
are not environmentally significant, consistent with the de minimis
exemption criteria set forth in Ala. Power Co. v. Costle, 636 F.2d 323,
at 360-361 (D.C. Cir. 1979). Here, we discuss our evaluation of the
basis provided by ADEQ for the types and sizes of facilities,
buildings, structures or installations it will subject to review under
its minor NSR program. Historically, ADEQ's minor NSR program required
permitting of minor sources and non-major modifications causing an
increase in potential emissions of a criteria pollutant at or above the
significant emission rates under the PSD program in 40 CFR
51.166(b)(23)(i). In a May 22, 1996 letter to ADEQ, EPA Region 9
indicated that the significant emission rates used by ADEQ for its
minor NSR permitting program did not represent an acceptable threshold
for applying the basic preconstruction requirements for minor NSR
purposes. To address EPA's concerns, ADEQ assessed other potential
permitting thresholds for its minor NSR program and selected revised
thresholds for its minor NSR program following this assessment. A
detailed analysis of ADEQ's assessment is provided in our TSD. ADEQ's
new minor NSR program established a minimum preconstruction review
threshold for new or modified stationary sources with potential
emissions or emissions increases of: 50 tons per year (tpy) of carbon
monoxide; 20 tpy of NOX, SO2, and VOC; 7.5 tpy
for PM10; 5 tpy for PM2.5; and 0.3 tpy for lead.
We find ADEQ's general approach to meeting 40 CFR 51.160(e) acceptable.
We are proposing a limited disapproval of ADEQ's minor NSR program
based in part on the following issues concerning the approach:
First, ADEQ's submittal does not provide a clear basis for
concluding that the exemption thresholds selected by ADEQ will ensure a
sufficient percentage of minor sources are subject to review in
nonattainment areas. As ADEQ points out in its submittal, ADEQ's
analysis is based on data for Maricopa County \11\, which has lower NSR
permitting thresholds than the exemption thresholds adopted by ADEQ due
to Maricopa County's local air quality problems. In addition, (1) some
of the other permitting programs in Table 3 above have lower permitting
thresholds in nonattainment areas than those applicable in attainment
areas under their jurisdiction; (2) in looking at a similar analysis of
minor source emissions for another permitting program in Region 9,
which has local air quality problems, the permitting agency generally
set thresholds that include a larger percentage of emissions in the NSR
program than the percentage included in ADEQ's program \12\; and (3)
typically, nonattainment areas have more control requirements that
apply to smaller minor sources, as compared to attainment areas. As
such, ADEQ's basis does not clearly address how its adopted
preconstruction review exemption thresholds adequately address
nonattainment areas.\13\
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\11\ ADEQ does not have jurisdiction for permitting of minor
sources in Maricopa County, AZ.
\12\ See EPA's Technical Support Document for Revision of Air
Quality Implementation Plan; California; Sacramento Metropolitan Air
Quality Management District; Stationary Source Permits, 78 FR10589,
Feb. 2, 2014, at 6-7, describing the thresholds applicable in
Sacramento as generally excluding less than 5% of the emissions
inventory except for SO2.
\13\ In addressing this deficiency, ADEQ does not necessarily
have to consider lower permitting exemption thresholds in
nonattainment areas. For example, ADEQ could provide further
analysis to demonstrate that the adopted thresholds are appropriate
for nonattainment areas or consider a different approach, such as
requiring minor sources in nonattainment areas subject to a SIP
requirement for the nonattainment pollutant, or its precursors, to
obtain a registration, if ADEQ can demonstrate that such an approach
would serve to satisfy the requirements of 40 CFR 51.160.
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Second, while EPA agrees that, in general, certain types of
equipment may be exempted from the minor NSR program, ADEQ must provide
a basis under 40 CFR 51.160(e) to demonstrate that regulation of the
equipment exempted in R18-2-302(C) and A.R.S. Sec. 49-426(B) is not
needed for ADEQ's program to meet federal NSR requirements for
attainment and maintenance of the NAAQS or review for compliance with
the control strategy. Such demonstration must address: (1) An
explanation of whether the regulatory exemption in R18-2-302(C) for
``agricultural equipment used in normal farm operations'' constitutes
an interpretation or refinement of the exemption for such sources in
A.R.S. Sec. 49-426(B), and how the two provisions apply to ADEQ's NSR
program; (2) Identification of the types of equipment ADEQ considers to
be ``agricultural equipment used in normal farm operations'' and
whether this type of equipment could potentially be expected to occur
at a stationary source subject to title V of the Act, 40 CFR parts 60,
61, or 63, or major NSR, and, if so, whether such equipment is subject
to NSR review at such sources; (3) ADEQ's basis for determining that
``agricultural equipment used in normal farm operations'' does not need
to be regulated as part of ADEQ's minor NSR program under 40 CFR
51.160(e); and (4) ADEQ's interpretation of the exemption for fuel
burning equipment in A.R.S. Sec. 49-426(B) and how it does, or does
not, apply in the context of its major and minor NSR programs, and, to
the extent such equipment is not subject to NSR review, ADEQ's basis
for determining that equipment exempted under this provision does not
need to be reviewed as part of ADEQ's minor NSR program under 40 CFR
51.160(e).
Finally, ADEQ's minor NSR program sets a permitting exemption
threshold for PM2.5 of 5 tons per year, but ADEQ's analysis
does not provide a basis for this threshold.
3. Public Availability of Information
40 CFR 51.161 requires that each NSR program contain certain
procedures related to public participation. We have identified several
deficiencies with ADEQ's program as it pertains to these requirements.
First, ADEQ's program does not ensure that NSR review for all minor
sources regulated under ADEQ's NSR program, as ADEQ defines it pursuant
to 40 CFR 51.160(e), is subject to public notice and comment consistent
with 40 CFR 51.161(a). 40 CFR 51.161(a) requires that the program under
51.160 provide for public comment on the information submitted by
owners or operators. In addition, the public information must include
ADEQ's analysis of the effects of construction or modification on
ambient air, including ADEQ's proposed approval or disapproval. ADEQ's
program does not meet this requirement because: (1) ``modification'' of
existing sources that become subject to the registration program under
R18-2-302.01 (currently only ``construction'' of a source) are not
subject to public notice (see R18-2-302.01(B)(3)); (2) R18-2-334(G)
exempts most modifications from public notice; (3) R18-2-330 does not
clearly define which public notice requirements apply to registrations;
and (4) public participation does not appear to be
[[Page 14050]]
required for a proposed disapproval of an application for any portion
of ADEQ's NSR program (registration, minor NSR, or major NSR).
Second, ADEQ's registration program at R18-2-302.01(F) does not
contain the necessary enforceable procedures for sources taking
``elective limits'' to limit their potential to emit in a manner that
allows the source to avoid the public participation requirements in 40
CFR 51.161(a), while otherwise being subject to the registration
program. See R18-2-302.01(B)(3)(b) and R18-2-302(E)(1). While ADEQ's
rule contains requirements for monitoring, recordkeeping, and reporting
of elective limits, these requirements are not sufficiently enforceable
for purposes of limiting the source's potential to emit, and thereby
avoiding public notice, as well other substantive requirements of
ADEQ's minor NSR program when issuing a registration. In order to meet
practical enforceability requirements for limiting the potential to
emit (PTE), R18-2-302.01(F) must also contain (1) a technically
accurate limitation and the portions of the source subject to the
limitation and (2) the time period for the limitations (hourly, daily,
monthly, etc.). Further, if the limitation is over a period longer than
daily, R18-2-302.01(F) must specify when to compile daily records to
show compliance with the elected limit. Additional detail on this issue
is provided in our TSD.
Third, ADEQ's NSR program does not ensure, for all sources subject
to NSR review, the availability for public inspection, in at least one
location in the area affected, of the information submitted by the
owner or operator and of ADEQ's analysis on the effect on air quality
as required by this federal regulation. R18-2-330(D)(11) requires the
public notice to identify the nearest ADEQ office where documents can
be inspected, but there are only two department offices for ADEQ. See
40 CFR 51.161(b)(1). We do not interpret this provision as meeting the
requirement to make information available in the ``area affected.'' In
addition, the public notice requirements do not make reference to
providing ADEQ's analysis for public inspection. Potentially, this is
covered by ``all other materials available to the Director that are
relevant to the permit decision''.\14\ But it is not clear that ADEQ
would interpret this to mean the Director's own analysis.
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\14\ This requirement is met for ADEQ's registration program at
R18-2-302.01(B)(3)(a).
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Finally, ADEQ's NSR program does provide notice to the necessary
parties in 40 CFR 51.161(d) for sources required to obtain
registrations under R18-2-302.01.
4. Administrative Procedures
40 CFR 51.163 requires each NSR program to include administrative
procedures that will be followed in making the determinations specified
in 40 CFR 51.160(a). While ADEQ's program generally meets the
requirements of this provision, ADEQ's submittal contains references to
other ADEQ rules, R18-2-317 and R18-2-317.02, which are not in the SIP
and have not been submitted for SIP approval. See R18-2-306.02(D), R18-
2-319(I), R18-2-304(J), R18-2-306(A), and R18-2-306.02(D).
5. Stack Height Procedures
40 CFR 51.164 requires that each NSR program contain certain
provisions related to good engineering practice for stack heights. In
addition to reviewing ADEQ's submittal as compared with the NSR program
requirements of 40 CFR 51.164, we also reviewed ADEQ's submittal as it
relates to certain general SIP program requirements in 40 CFR 51.100
and 51.118. The stack height provisions in the NSR program rely on the
general stack height provisions in 40 CFR 51.118(b), which in turn
references the definitions in 40 CFR 51.100(hh) through (kk). We have
identified several deficiencies with ADEQ's program as it pertains to
these requirements.
First, ADEQ's submittal does not meet the public hearing
requirements in 40 CFR 51.164 and 51.118(a). While R18-2-332(E)
contains a reference to holding a public hearing, when required, the
provision references ADEQ's public hearing provision in R18-1-402. R18-
1-402 is not in the SIP and has not been submitted for SIP approval.
Second, ADEQ's submittal does not contain language that meets the
exception in 40 CFR 51.118(b): ``except where pollutants are being
emitted from such stacks or using such dispersion techniques by
sources, as defined in section 111(a)(3) of the Clean Air Act, which
were constructed, or reconstructed, or for which major modifications,
as defined in Sec. Sec. 51.165(a)(1)(v)(A), 51.166(b)(2)(i) and
52.21(b)(2)(i), were carried out after December 31, 1970.'' In
addition, R18-2-332(A)(3) incorrectly references July 1, 1975 instead
of July 1, 1957 as that date appears in 40 CFR 51.118(b).
Third, ADEQ's submittal does not contain a requirement that owners
or operators seeking to rely on the equation in 40 CFR 51.100(ii)(2)(i)
produce evidence that the equation was actually relied on in
establishing an emission limitation. See R18-2-332(B)(2).
Finally, ADEQ's submittal contains a provision at R18-2-332(D) that
provides additional provisions for sources ``seeking credit because of
plume impaction which results in concentrations in violation of
national ambient air quality standards or applicable maximum allowable
increases.'' This provision is not contained in the federal regulations
and appears to allow for the use of stack heights beyond GEP stack
height, as defined in 40 CFR 51.100(ii).
In sum, while we have identified several disapproval issues with
ADEQ's minor NSR program requirements as they correspond to federal
minor NSR program requirements, compared to the existing SIP, approving
ADEQ's minor NSR program into the Arizona SIP nonetheless represents a
significant overall strengthening of ADEQ's NSR program, as discussed
above. Thus, we are proposing a limited approval and limited approval
of ADEQ's minor NSR program submittal.
C. Do the rules meet the evaluation criteria for Prevention of
Significant Deterioration (PSD)?
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 SIP-approved PSD permit programs are found in 40 CFR
51.166.
ADEQ rules R18-2-402 and R18-2-406 contain the substantive
requirements for review and permitting of PSD sources under ADEQ's
jurisdiction. These regulations satisfy most of the statutory and
regulatory requirements for PSD permit programs, but these and other
rules in the NSR SIP submittal contain several deficiencies that form
the basis for our proposed limited disapproval, or proposed
disapprovals as discussed below.
Although ADEQ's submittal meets most PSD program requirements, we
are proposing to disapprove two specific aspects of ADEQ's PSD program.
The ADEQ rule provisions that we are proposing to disapprove are
directly comparable to federal PSD rule provisions that have been
vacated by federal courts, and we find that they are separable from the
remainder of ADEQ's PSD program. Accordingly, we find these provisions
suitable for disapproval at this time. These provisions are described
below in Sections II.C.8 and 9.
[[Page 14051]]
For the remainder of ADEQ's PSD program submittal, we are proposing
limited approval and limited disapproval. We find that approval of
ADEQ's updated PSD program, aside from the two aspects that are
separable and will be disapproved as mentioned above, will
substantially strengthen the SIP overall, particularly as the current
SIP-approved PSD program is significantly out of date when compared
with current federal PSD regulatory requirements as well as current
State regulations. See our discussion in Section G below. However,
specific provisions of the PSD SIP program submittal are inconsistent
with PSD program requirements, and these deficiencies must be addressed
before we can fully approve ADEQ's PSD program. The deficiencies that
we have identified with ADEQ's PSD program that provide the basis for
our limited disapproval are described below in Sections II.C.1 through
7.
1. General PSD Program Requirements
First, ADEQ's submittal often refers to Articles 9 and/or 11 of
ADEQ's regulations where the federal regulations refer to 40 CFR parts
60, 61, or 63; or, similarly, sections 111 or 112 of the Act. See R18-
2-101(53)(a), (122)(b); R18-2-401(10); R18-2-402(G)(2); and R18-2-
406(A)(4). Articles 9 and 11 are where ADEQ incorporates by reference
the federal regulations in 40 CFR part 60, 61, and 63 (which EPA
implements under sections 111 and 112 of the Act). However, these
Articles are not in the SIP, have not been submitted for SIP approval,
and do not contain provisions equivalent to all of the subparts in
parts 60, 61, and 63. See 40 CFR 51.166(b)(1)(iii)(aa), (b)(12),
(b)(16)(i), (b)(17), (b)(47)(ii)(c), (b)(49)(ii), (i)(1)(ii)(aa), and
(j).
Second, ADEQ's submittal uses the term ``increment'' or
``incremental ambient standard,'' but does not specifically define
these terms or otherwise identify what is meant by these terms. While
the PSD program does not specifically define the term ``increment''
either, the term is introduced at 40 CFR 51.166(c)--Ambient air
increments and other measures. (emphasis added) 40 CFR 51.166(c) then
goes on to identify the specific increment values as ``maximum
allowable increases.'' ADEQ appears to have taken the approach of using
the term ``maximum allowable increase'' to refer to the increments,
which is acceptable. ADEQ adopted the increments, or maximum allowable
increases, in R18-2-218--Limitation of Pollutants in Classified
Attainment Areas. However, in other rules ADEQ uses ``increment'' or
``incremental ambient standard'' where it appears the intent is to
refer to the increments established in R18-2-218 and identified in
ADEQ's rules as the ``maximum allowable increases.'' See R18-2-406(E),
R18-2-412(G)(b), R18-2-101(51), R18-2-319, R18-2-320.
Third, on January 15, 2013, EPA issued a final rule revising the
NAAQS for PM2.5 for the annual averaging period, lowering
the level of the NAAQS from 15.0 to 12.0 mg/m\3\, effective March 18,
2013 (see 78 FR 3086). This new NAAQS is required to be implemented for
PSD sources (unless otherwise grandfathered under provisions at 40 CFR
51.166(i)(10)) beginning with the effective date of the NAAQS. However,
ADEQ's PSD program does not provide for the review of new or modified
sources for compliance with this new NAAQS as required in 40 CFR
51.166(b)(2)(iii)(i)(2), (b)(35), (d), (g)(3)(iii), (k), and (m)(1).
Instead, ADEQ's PSD program currently references state ambient air
quality standards, which are set at levels that are equivalent to all
of the current NAAQS, except for this newly adopted PM2.5
NAAQS. See R18-2-218(F)(b)(ii), R18-2-401(25), R18-2-406(A) and R18-2-
407(B). Because of the general approach used in ADEQ's NSR program with
respect to incorporating the NAAQS, i.e., the program's reference to
state air quality standards instead of the NAAQS, any changes EPA makes
to the NAAQS will not be included in ADEQ's program until ADEQ revises
its air quality standards rules to adopt the revised NAAQS as state air
quality standards. This does not relieve any owner or operator from the
requirement to comply with all NAAQS at the time a final PSD permit is
issued, including the recently revised new PM2.5 NAAQS
(unless otherwise grandfathered under 40 CFR 51.166). See CAA section
165(a)(3).
Fourth, R18-2-406(A) contains a reference to R18-2-408, but R18-2-
408 is not in the SIP and has not been submitted for SIP approval.
Fifth, ADEQ's submittal allows a source at R18-2-302(G) and R18-2-
402(C) to begin actual construction upon the issuance of a proposed
final permit. As previously discussed, ADEQ's program is ambiguous as
to whether a proposed final permit, as defined in R18-2-101(114),
constitutes final action by the Director. While ADEQ has issued
guidance clarifying that it treats ``proposed final permits'' as final
actions for purposes of preconstruction permitting \15\, to obtain full
PSD program approval, ADEQ's regulations must make clear that a source
may not begin actual construction before a final determination on a PSD
permit application is made by the Director.
---------------------------------------------------------------------------
\15\ See ADEQ memo dated February 10, 2015 related to proposed
final permits, and ADEQ's February 23, 2015 Supplement at 2.
---------------------------------------------------------------------------
Sixth, ADEQ's NSR submittal contains provisions that allow for
exclusions from increment consumption, for certain temporary emissions,
that do not conform to the requirements in the analogous federal rule.
First, ADEQ's rule at R18-2-218(F)(5) requires only the ADEQ Director's
approval for temporary emissions beyond two years, but the federal
program requirements at 40 CFR 51.166(f)(i)(v) and 51.166(f)(4) require
the Administrator's approval to allow temporary emissions that exceed
two years. In addition, ADEQ's program language does not reference a
specific time period beyond two years that it would allow for
exclusions from increment consumption, which is not consistent with the
federal regulation's requirement at 40 CFR 51.166(f)(4) that the time
for such exclusions be specified in the plan. Finally, the provision at
R18-2-218(F)(5)(b)(ii), which references the state ambient air quality
standards, must be applied to ``any'' air quality control region. As
currently written this provision does not clearly apply to areas
outside of Arizona where Arizona's standards would not generally apply.
Seventh, ADEQ's submittal contains a provision at R18-2-406(E)
providing an exemption for certain portable stationary sources with a
prior permit that contains requirements equivalent to the PSD
requirements in 40 CFR 51.166 (j) through (r), as allowed by 40 CFR
51.166(i)(1)(iii). However, ADEQ's rule at R18-2-406(E) is worded
broadly to also allow an exemption for portable sources that have been
permitted under Article 4 of ADEQ's regulations, which also includes
nonattainment NSR permits and PAL permits. We do not interpret this
federal exemption as generally applying to such permits, as it is not
clear that such permits contain requirements ``equivalent'' to those in
40 CFR 51.166(j) through (r).
Eight, ADEQ's submittal contains conditions generally meeting the
requirements of 40 CFR 51.166(k)(1) in rule R18-2-406(A)(5)(a).
However, R18-2-406(A)(5) contains an ``or'' between subsections (a) and
(b) that could be interpreted as allowing a source to demonstrate it
will not contribute to an
[[Page 14052]]
increase above the significance levels in an adjacent nonattainment
area in lieu of the demonstration required by R18-2-406(A)(5)(a). The
provisions of subsection (b) relate to requirements under a different
portion of the NSR program--specifically under 40 CFR 51.165. As such,
it is likely ADEQ would interpret subsections (a) and (b) as separate
requirements with which a source must demonstrate compliance.
Nevertheless, the potential for misinterpretation of this substantive
requirement of the PSD program provides a basis for our limited
disapproval of the PSD program submittal. In addition, R18-2-
406(A)(5)(a) requires that a person applying for a PSD permit
demonstrate that the project would not cause a violation of any maximum
allowable increase over the baseline concentration in ``any attainment
or unclassifiable area.'' However, ADEQ's definition for ``attainment
area'' in the SIP at R18-2-101(19) limits attainment areas to those
``in the state.'' In addition, as discussed previously, it is not clear
that ADEQ's references to the state's ambient air standards would apply
in areas outside of Arizona.
Ninth, ADEQ's submittal includes R18-2-406(A)(6)(b), which
specifies that the use of a modified or substituted model must be
subject to public notice and the opportunity for public comment, but
neither the rule nor the submittal makes clear the procedures that
would be used for notice and comment for this purpose or demonstrates
that such procedures would be consistent with 40 CFR 51.102, as
required by 40 CFR 51.166(l)(2).
Tenth, ADEQ's PSD SIP submittal does not appear to specifically
address the requirements of 40 CFR 51.166(n)(1) and (3), which require
that the SIP must require that (1) the owner or operator of a proposed
source or modification shall submit all information necessary to
perform any analysis or make any determination required under
procedures established in accordance with 40 CFR 51.166, and (2) upon
request of the state, the owner or operator shall also provide
specified information concerning air quality impacts and growth. ADEQ's
submittal at R18-2-304, R18-2-402(G) and R18-2-407 identifies the
information necessary for a complete application under this program and
requires applicants to respond to deficiencies in the application, but
these provisions do not appear to fully address the requirements of 40
CFR 51.166(n)(1) and (3).
Eleventh, ADEQ's submittal contains an apparent typographical error
in R18-2-402(F)(1)(c), which includes a cross-reference to R18-2-
401(20)(b)(iii) rather than R18-2-401(20)(b)(iv). See 40 CFR
51.166(r)(6).
Finally, ADEQ's submittal does not require owners or operators to
make information required under 40 CFR 51.166(r)(6) available for
review upon request by the Director or the general public pursuant to
the requirements in 40 CFR 70.4(b)(3)(viii) as is required by 40 CFR
51.166(r)(7).
2. Restrictions on Area Classifications
40 CFR 51.166(e) contains provisions related to restrictions on
area classifications (Class I, II, or II). We have identified several
deficiencies in ADEQ's program with respect to these provisions.
First, ADEQ's submittal contains requirements for area
classifications in R18-2-217. However, ADEQ's submittal does not
completely meet the requirements of 40 CFR 51.166(e) and section 162(a)
of the Act, which require certain areas in existence on August 7, 1977
to be designated as Class I areas. Such designations apply to any
boundary changes made to those Class I areas after August 7, 1977.
While ADEQ generally includes this requirement at R18-2-217(B), its
rule limits such boundary changes to those made prior to March 12,
1993.
Second, ADEQ's NSR submittal at R18-2-217 does not contain a
provision consistent with the federal regulatory requirement for Class
I area redesignations prior to August 7, 1977 in rule R18-2-217 or
elsewhere as required by 40 CFR 51.166(e)(2). Even if it is the case
that there are no areas in Arizona that were redesignated Class I prior
to August 7, 1977, ADEQ's program must recognize Class I area
designations under this provision that may have been made in other
states for which sources within ADEQ may have an impact. See 40 CFR
51.166(e)(2).
Finally, ADEQ's NSR submittal does not include a provision that is
fully consistent with 40 CFR 51.166(e)(3). While ADEQ's rules generally
meet this requirement at R18-2-217(D), this rule does not fully meet
the requirements of 40 CFR 51.166(e)(3) because (1) it is not clear
what is meant in ADEQ's rule by ``all other areas'' and (2) it does not
contain a provision that ensures that ADEQ recognizes federal
legislation that specified the area classification of a particular
area.
3. Redesignations
40 CFR 51.166(g) contains provisions allowing certain areas
classified as Class I, II, or III to be redesignated to another
classification. We have identified several deficiencies in ADEQ's
program with these provisions.
First, ADEQ's submittal contains provisions at R18-2-217(A)
identifying that attainment and unclassifiable areas in the State shall
be designated as Class I, II, or III. However, this portion of the PSD
program applies to all areas of the State. That is, all areas of the
State must be designated as Class I, II, or III irrespective of their
attainment designation under Section 107 of the Act. See 40 CFR
51.166(g)(1).
Second, ADEQ's submittal contains provisions at R18-2-217(E) for
allowing the state to redesignate certain areas, but the submittal does
not adequately meet the public participation requirements specified in
the federal regulation at 40 CFR 51.166(g)(2)(i), which requires a
public hearing consistent with the procedures in 40 CFR 51.102. ADEQ's
redesignation provisions do not specify the public hearing procedures
that will be used. See 40 CFR 51.166(g)(2)(i).
Third, ADEQ's provisions for redesignating areas to Class III do
not clearly identify which areas may be designated as Class III as
specified in 40 CFR 51.166(g)(3).
Fourth, R18-2-217(E) allows for the redesignation to be approved by
the Governor or the Governor's designee. However, the federal program
at 40 CFR 51.166(g)(3)(ii) specifically requires the Governor's
approval and does not allow for this approval to be delegated. See 40
CFR 51.166(g)(3)(ii).
Fifth, R18-2-217(F)(4) contains a reference to ``maximum allowable
concentration'' which appears to refer to R18-2-218(E). However, R18-2-
218(E) references the ``ambient air quality standards in this
Article.'' The state's ambient air quality standards do not generally
apply in areas outside of Arizona, and ADEQ's NSR submittal does not
demonstrate that they would apply outside of Arizona for purposes of
R18-2-217(F)(4). See 40 CFR 51.166(g)(3)(iii).
Finally, ADEQ's provisions do not clearly require that a permit
application that can only be approved if an area is redesignated to
Class III, and material submitted as part of that application, must be
available for public inspection prior to the public hearing on the
redesignation to Class III. See 40 CFR 51.166(g)(3)(iv).
4. Impacts on Class I Areas
40 CFR 51.166(p) contains additional requirements related to
protection of Federal Class I areas. We have identified several
deficiencies in ADEQ's program with these provisions.
[[Page 14053]]
First, ADEQ's submittal does not address the requirements of 40 CFR
51.166(p)(1), but they are generally addressed by existing SIP
requirements in R9-3-304(H). However, the existing SIP only requires
application information to be submitted to the Federal Land Manager,
and does not require that this information be provided to EPA as
required by this provision. Consistent with 40 CFR 51.166(p)(2), the
Federal Land Manager works in consultation with EPA on the protection
of Class I lands.
Second, ADEQ's submittal does not address the requirement under 40
CFR 51.166(p)(3), but it is addressed by the existing SIP requirement
in R9-3-304(H)(1). However, the existing SIP contains outdated maximum
allowable increases that must be updated. See 40 CFR 51.166(p)(3).
Finally, ADEQ's submittal generally includes the provisions of 40
CFR 51.166(p)(4) at R18-2-406(F)(2), but contains the phrase ``no
significant adverse impacts,'' which is inconsistent with the federal
regulation which requires a demonstration of ``no adverse impacts.''
The addition of the word ``significant'' is somewhat ambiguous in this
context, but appears to allow variances under circumstances not allowed
under the analogous federal regulation.
5. Public Participation
40 CFR 51.166(q) contains several specific public participation
requirements for issuing PSD permits. We have identified several public
participation deficiencies in ADEQ's program.
First, ADEQ's submittal does not ensure that materials available
during the public comment period are available in each region in which
the proposed source would be constructed as required by 40 CFR
51.166(q)(2)(ii). While ADEQ's program at R18-2-330(D)(11) requires
these materials to be available at the nearest Department office, ADEQ
only has two Department offices. As such, it is not clear that in all
instances the public affected by a proposed project would have
reasonable access in their region to the materials specified in 40 CFR
51.166(q)(2)(ii).
Second, ADEQ's submittal does not require ADEQ to notify the public
of (1) the degree of increment consumption that is expected from the
source or modification, or (2) the Director's preliminary
determination, as required by 40 CFR 51.166(q)(2)(iii).
Third, ADEQ's submittal does not require ADEQ to make the public
comments and the written notification of its final determination
available in the same location as the preliminary documents as required
by 40 CFR 51.166(q)(2)(vi) and (viii).
Finally, ADEQ's submittal requires the Director to take final
action on an application within one year of receipt of a complete
application--R18-2-402(I)(3). See 40 CFR 51.166(q)(2)(vii). However,
ADEQ's program also indicates that a source may begin actual
construction once a ``proposed final permit'' is obtained. See R18-2-
402(C) and R18-2-302(G). ADEQ's regulations are ambiguous as to whether
a proposed final permit, as defined in R18-2-101(114), constitutes
final action by the Director that is subject to administrative and/or
judicial review. As EPA has stated previously in the context of our
actions on other State SIP submittals, we interpret the CAA to require
an opportunity for judicial review of a decision to grant or deny a PSD
permit, whether issued by EPA or by a State under a SIP-approved or
delegated PSD program. 77 FR 65305, 65306, Oct. 26, 2012 (EPA's
approval of the San Joaquin Valley Unified Air Pollution Control
District's PSD program into the California SIP); see also 61 FR 1880,
1882. Jan. 24, 1996 (EPA's proposed disapproval of Virginia's PSD
program SIP revision due to State law standing requirements that
limited judicial review); 72 FR 72617, 72619, Dec. 21, 2007 (in
approving South Dakota's PSD program, EPA stated that it interprets the
CAA and regulations to require at minimum an opportunity for state
judicial review of PSD permits). EPA continues to interpret the
relevant provisions of the Act as described in these prior rulemaking
actions. While ADEQ has issued guidance clarifying that it treats
``proposed final permits'' as ``appealable agency actions,'' under
Arizona law,\16\ in order to obtain full PSD program approval, ADEQ's
regulations must make clear that a source may not begin actual
construction before a final determination on a PSD permit application
is made by the Director, which would be subject to administrative and/
or judicial review.
---------------------------------------------------------------------------
\16\ See ADEQ memo dated February 10, 2015 related to proposed
final permits. ADEQ submitted this memo in its February 23, 2015
supplement.
---------------------------------------------------------------------------
6. Plantwide Applicability Limits
ADEQ's rules contain provisions for using plantwide applicability
limits (PALs) in R18-2-412. We have identified the following
deficiencies with ADEQ's PALs provisions program as they relate to the
PSD program.
First, neither the ADEQ regulatory provisions for PALs at R18-2-412
nor the ADEQ regulatory definitions in R18-2-401 that apply in the
context of major sources and major modifications contain a definition
for major emissions unit as is required by 40 CFR 51.166(w)(2)(iv).
(This term is also not included in the definitions at R18-2-101 or R18-
2-301 that ADEQ submitted for approval as part of this action.)
Second, ADEQ's PAL provision for calculating baseline emissions at
R18-2-412(B)(2) does not specify that baseline actual emissions are to
include emissions associated not only with operation of the unit, but
also emissions associated with startup, shutdown and malfunction, as is
required by 40 CFR 51.166(w)(3)(ii).
Third, ADEQ's PAL provisions at R18-2-412(H) contain an incorrect
reference to (H)(4) instead of the definition for major modification,
and R18-2-412(H)(5) uses ``eliminated'' where the federal regulation
uses ``established.'' See 40 CFR 51.166(w)(9).
Finally, ADEQ's PAL renewal provisions at R18-2-412(I)(1) must
contain a reference to subsection (D) of R18-2-412 instead of (F). In
addition, R18-2-(I)(4)(a) must reference subsection (E) of R18-2-412.
See 40 CFR 51.166(w)(10).
7. Definitions
ADEQ's submittal contains definitions applicable to the PSD program
that do not fully meet the requirements of 40 CFR 51.166(b)(1), which
requires each State plan to contain specific definitions for the PSD
program. Deviations from the wording are approvable if the State
specifically demonstrates that the submitted definition is more
stringent, or at least as stringent, in all respects as the
corresponding definition in 40 CFR 51.166(b). We have carefully
reviewed the definitions used in ADEQ's PSD program as compared with
the federal PSD definitions in 40 CFR 51.166(b) and have found that,
generally, ADEQ's submittal contains the definitions necessary to
implement a PSD program. However, a number of ADEQ's definitions do not
meet the requirements of 40 CFR 51.166(b)(1) because their wording
deviates from the wording in the corresponding federal regulatory
definitions in 40 CFR 51.166(b)(1) in a manner that may be less
stringent than the federal definitions, and the State has not
demonstrated otherwise.
Major stationary source at 40 CFR 51.166(b)(1)--language from
subparagraph 40 CFR 51.166(b)(1)(i)(c) not included in the definition
at R18-2-101(75). See also discussion below of the definition of
``stationary source'' in 40 CFR 51.166(b)(5).
[[Page 14054]]
Net emissions increase at 40 CFR 51.166(b)(3)--ADEQ's definition at
R18-2-101(87)(c) identifies that an increase or decrease in actual
emissions is creditable only to the extent that the Director has not
relied on it in issuing a permit. However, this definition is broader
than the definition in the PSD program, which only specifies that the
reviewing authority has not relied on the increase or decrease in
issuing a PSD permit. In some respects this makes ADEQ's definition
more stringent (decreases), but in other respects less stringent
(increases). In addition, the equivalent of paragraph 40 CFR
51.166(b)(3)(viii) is not included in ADEQ's definition at R18-2-
101(87).
Stationary source at 40 CFR 51.166(b)(5)--the federal regulation at
40 CFR 51.166(b)(5) defines this term as ``any building, structure,
facility or installation which emits or may emit a regulated NSR
pollutant,'' with ``regulated NSR pollutant'' also being a federally
defined term at 40 CFR 51.166(b)(49), whereas ADEQ's regulation at R18-
2-101(39) defines ``stationary source'' as ``any building, structure,
facility or installation subject to regulation pursuant to A.R.S. Sec.
49-426(A) which emits or may emit any air pollutant,'' with ``air
pollutant'' being an undefined term in ADEQ's regulation. We note that
A.R.S. Sec. 49-426(A) provides a cross-reference to certain exemptions
from permitting identified in A.R.S. Sec. 49-426(B), specifically
agricultural equipment used in normal farm operations and certain fuel
burning equipment, which do not appear to be consistent with the
federal PSD definition. The federal definition for stationary source is
very broad and does not exclude these source categories. We agree that
it is acceptable for ADEQ to limit its NSR program to certain kinds of
stationary sources, as specified in 40 CFR 51.160(e), but the federal
definition for a stationary source in the context of the PSD program is
not the appropriate place for such an exclusion, as it does not allow
exclusions for certain source categories.
Major source baseline date at 40 CFR 51.166(b)(14)--language
equivalent to paragraph 40 CFR 51.166(b)(14)(iv) is not included at
ADEQ's definition in R18-2-218(B)(1).
Baseline area 40 CFR 51.166(b)(15)--ADEQ's definition at R18-2-
218(D) contains an incorrect reference to R18-2-217 rather than
referring to section 107(d)(1)(A)(ii) or (iii) of the Act or the
equivalent; also, language equivalent to that in paragraph 40 CFR
51.166(b)(15)(iii) is not included.
Allowable emissions at 40 CFR 51.166(b)(16)--ADEQ's definition at
R18-2-101(13)(b) does not include the ``future compliance date''
language that is in 40 CFR 51.166(b)(16)(ii) and ADEQ has not
demonstrated that its regulatory language is at least as stringent as
the federal definition.
Federally enforceable at 40 CFR 51.166(b)(17)--ADEQ's definition at
R18-2-101(53)(d) identifies that requirements included in permits
pursuant to R18-2-306.01 or R18-2-306.02 are included in the definition
of federally enforceable requirements, but excludes those requirements
that are identified as ``enforceable only by the state.'' With this
action, we approving R18-2-306.01 and R18-2-306.02 into the SIP, making
requirements pursuant to these rules federally enforceable. As such,
ADEQ does not have the discretion to identify some of those
requirements as only enforceable by the state.
Complete at 40 CFR 51.166(b)(22)--ADEQ's definition at R18-2-401(4)
is missing the second sentence of the federal definition.
Significant at 40 CFR 51.166(b)(23)- ADEQ definition at R18-2-
101(130)(e) uses ``milligrams'' instead of ``micrograms'' as required
in paragraph 40 CFR 51.166(b)(23)(iii).
Projected actual emissions at 40 CFR 51.166(b)(40)--ADEQ's
definition at R18-2-401(20)(b)(iii) does not specifically require
inclusion of emissions from malfunctions in the determination of
projected actual emissions, and exempts emissions from a shutdown
associated with a malfunction from such determination, while the
federal definition at 40 CFR 51.166(b)(40)(ii)(b) requires that
emissions from both shutdowns and malfunctions be included.
Subject to regulation at 40 CFR 51.166(b)(48)--this definition is
not included in ADEQ's NSR SIP submittal. ADEQ did not adopt a
definition for the term ``subject to regulation'' or include such
definition as part of the NSR SIP submittal, presumably because the
federal definition of the term contains the requirements of the
Greenhouse Gas (GHG) Tailoring Rule, and GHGs cannot be regulated under
Arizona state law.\17\ We note, however, that while the GHG program
requirements are contained as part of the definition of the term
``subject to regulation,'' the federal definition of this term also
contains non-GHG-specific program elements for determining when a
pollutant is ``subject to regulation.'' As such, ADEQ must add a
definition to its PSD regulations to address these elements of the term
``subject to regulation'' in order to obtain full program approval.
---------------------------------------------------------------------------
\17\ ADEQ is currently subject to a Federal Implementation Plan
under the PSD program for GHGs because ADEQ did not adopt a PSD
program for the regulation of GHGs. See 40 CFR 52.37. ADEQ's NSR SIP
submittal does not attempt to correct this program deficiency, as
regulation of GHG emissions currently is not permitted under State
law. See A.R.S. Sec. 49-191.
---------------------------------------------------------------------------
Regulated NSR pollutant at 40 CFR 51.166(b)(49)--ADEQ's regulatory
definition at R18-2-101(122) does not include the final two sentences
of 40 CFR 51.166(b)(49)(i)(a)or the language at 40 CFR
51.166(b)(49)(iv); ADEQ's definition also includes an incorrect cross-
reference to hazardous air pollutants listed under R18-2-1101 that is
not consistent with the requirements in 40 CFR 51.166(b)(49)(v); and
ADEQ's regulatory definition needs to update the July 1, 2010 date in
the cross-reference to CAA section 108.
8. PM2.5 Significant Monitoring Concentration
On January 22, 2013, the U.S. DC Circuit Court of Appeals in Sierra
Club v. EPA, 705 F.3d 458, vacated the parts of two federal PSD rules
(40 CFR 51.166(i)(5)(i)(c) and 40 CFR 52.21(i)(5)(i)(c)) establishing a
PM2.5 significant monitoring concentration (SMC), finding
that EPA was precluded from using the PM2.5 SMC to exempt
permit applicants from the statutory requirement to compile and submit
preconstruction monitoring data as part of a complete PSD application.
On December 9, 2013, revisions to 40 CFR 51.166 and 52.21 were
published in the Federal Register to remove these vacated rule
elements, effective as of that date. See 78 FR 73698.
ADEQ's submittal at R18-2-407(H)(1)(c) contains the equivalent of
the PM2.5 SMC that was vacated by the Court of Appeals and
which has been removed from the federal PSD regulations. As the Court
of Appeals found application of this SMC impermissible, and because
ADEQ's regulation incorporating this SMC is a separable portion of
ADEQ's PSD program, we are proposing a partial disapproval of ADEQ's
submitted PSD program, to disapprove R18-2-407(H)(1)(c).
9. Definition for Basic Design Parameter
ADEQ's submittal contains a definition for basic design parameter
at R18-2-401(3) that reflects the definition that EPA originally
developed as part of its Equipment Replacement Provisions. See 68 FR
61248 Oct. 27, 2003. However, the definition for basic design
parameter, and other elements related to the Equipment Replacement
Provisions, were vacated by the DC Circuit Court of Appeals in State of
New York v. EPA,
[[Page 14055]]
443 F.3d 880 (D.C. Cir. 2006). While the federal PSD regulations still
contain a reference to ``basic design parameter,'' this term is no
longer specifically defined under the federal PSD regulations, and
application of the definition contained in the Equipment Replacement
Provisions that were vacated by the Court of Appeals is inconsistent
with federal PSD requirements. As the Court of Appeals found this
Equipment Replacement Provisions and, therefore, this definition,
impermissible, and because ADEQ's regulation incorporating this
definition is a separable portion of ADEQ's PSD program, we are
proposing a partial disapproval of ADEQ's submitted PSD program, to
disapprove R18-2-401(3).
D. Do the rules meet the evaluation criteria for 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 ``NA-
NSR.'' EPA's regulations for NA-NSR permit programs are found in 40 CFR
51.165. Most areas under ADEQ's jurisdiction are currently designated
as ``attainment'' or ``unclassifiable/attainment'' for all NAAQS
pollutants. However, there are some areas under ADEQ's jurisdiction
that are nonattainment and warrant a NA-NSR program. See 40 CFR 81.303.
R18-2-402 through 405 contain the substantive NA-NSR requirements
for review and permitting of major sources and major modifications in
nonattainment areas under ADEQ jurisdiction in Arizona. These
regulations satisfy most of the statutory and regulatory requirements
for NA-NSR permit programs, but these rules contain several
deficiencies that that do not allow us to fully approve the NA-NSR
program submittal that is the subject of this action, as discussed
below.
Although ADEQ's NA-NSR program submittal meets most NA-NSR program
requirements, we are proposing to disapprove one specific aspect of
ADEQ's NA-NSR program relating to the definition of ``basic design
parameter.'' The ADEQ rule provision that we are proposing to
disapprove is directly comparable to a federal NA-NSR rule provision
that has been vacated by a federal court, and we find that it is
separable from the remainder of ADEQ's NA-NSR program. Accordingly, we
find this provision suitable for disapproval at this time. This issue
is described in more detail below in Section II.D.4.
For most of the remainder of ADEQ's NA-NSR program submittal, we
are proposing limited approval and limited disapproval. We find that
approval of ADEQ's updated NA-NSR program, aside from the aspect that
is separable and is proposed for disapproval as mentioned above, will
substantially strengthen the SIP overall, particularly as the current
SIP-approved NA-NSR program is significantly out of date when compared
with current federal NA-NSR regulatory requirements as well as current
State regulations. See our discussion in Section G below. However,
specific provisions of the NA-NSR SIP program submittal are
inconsistent with NA-NSR program requirements, and these deficiencies
must be addressed before we can fully approve ADEQ's NA-NSR program
into the SIP. The deficiencies that we have identified with ADEQ's NA-
NSR program that provide the basis for our limited approval and limited
disapproval are described immediately below in Sections II.D.1 through
3.\18\
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\18\ For one other aspect of ADEQ's NA-NSR SIP submittal, we are
proposing limited approval at this time. We cannot determine at this
time whether ADEQ's NA-NSR SIP submittal adequately addresses all of
elements necessary to satisfy the CAA's title I, part D, subpart 4
requirements regarding NSR permitting of PM2.5 and
PM10 precursors under CAA section 189(e). This issue is
discussed in detail in Section II.D.5 below.
---------------------------------------------------------------------------
1. General Nonattainment NSR Program Requirements
First, as discussed above with respect to ADEQ's PSD program
submittal, ADEQ's NA-NSR program submittal often refers to Articles 9
and/or 11 of ADEQ's regulations where the federal regulations refer to
40 CFR parts 60, 61, or 63; or, similarly, sections 111 or 112 of the
Act. See R18-2-101(122)(b); R18-2-401(10); R18-2-402(G)(2); and R18-2-
406(A)(4). Articles 9 and 11 are where ADEQ incorporates by reference
the federal regulations in 40 CFR parts 60, 61, and 63 (which EPA
implements under sections 111 and 112 of the Act). However, these
Articles are not in the SIP, have not been submitted for SIP approval,
and do not necessarily contain provisions equivalent to all of the
subparts in parts 60, 61, and 63. See 40 CFR 51.165(a)(1)(xiii)--lowest
achievable emission rate, (a)(1)(xxxvii)--regulated NSR pollutant, and
(a)(1)(xl)--best available control technology.
Second, the nonattainment NSR program requirements at 40 CFR
51.165(a)(2) require each plan to have a preconstruction review program
to satisfy the requirements of sections 172(c) and 173 of the Act.
However, as previously discussed in this preamble, ADEQ's submittal
allows a source at R18-2-302(G) and R18-2-402(C) to begin actual
construction upon the issuance of a proposed final permit. ADEQ's
program is ambiguous as to whether a proposed final permit, as defined
in R18-2-101(114), constitutes final action by the Director. While ADEQ
has issued guidance clarifying that it treats ``proposed final
permits'' as final actions for purposes of preconstruction
permitting,\19\ to obtain full NA-NSR program approval, ADEQ's
regulations must make clear that a source may not begin actual
construction before a final determination on an NA-NSR permit
application is made by the Director.
---------------------------------------------------------------------------
\19\ See ADEQ Memo dated February 10, 2015 related to proposed
final permits and ADEQ's February 23, 2015 Supplement at 2.
---------------------------------------------------------------------------
Third, 40 CFR 51.165(a)(3)(ii)(G) requires that credit for emission
reductions can be claimed only to the extent that the reviewing
authority has not relied on it in issuing any permit under regulations
approved pursuant to 40 CFR 51 subpart I or the State has not relied on
it in demonstration of attainment or reasonable further progress.
ADEQ's NSR submittal generally addresses this requirement at R18-2-
404(H), but also needs to include references to rules R18-2-302.01 and
R18-2-334, which are to be approved as part of ADEQ's NSR regulations
under Subpart I.
Fourth, ADEQ's submittal contains an apparent typographical error
in R18-2-402(F)(1)(c), which includes a cross-reference to R18-2-
401(20)(b)(iii) rather than R18-2-401(20)(b)(iv). This error must be
corrected to ensure that the requirement in 40 CFR 51.165(a)(6)(i)(c)
for owners and operators to document and maintain a record of certain
applicability-related information is satisfied.
Fifth, ADEQ's submittal does not require owners or operators to
make information required under 40 CFR 51.165(a)(6) available for
review upon request by the Director or the general public pursuant to
the requirements in 40 CFR 70.4(b)(3)(viii) as is required by 40 CFR
51.165(a)(7).
Sixth, 40 CFR 51.165(a)(9)(i) requires that increases in emissions
shall be offset by reductions in emissions using a ratio of emission
decreases to emission increases of at least 1 to 1. ADEQ's NA-NSR
submittal contains this requirement at R18-2-404(A), but could
[[Page 14056]]
be interpreted as establishing the ratio as increases to decreases,
instead of decreases to increases--``emission increases shall be offset
by emission decreases at a ratio of at least 1 to 1.'' In addition,
R18-2-404(A) refers to additional offset requirements in R18-2-405, but
does not refer to the offset requirement in R18-2-404(J).
Seventh, 40 CFR 51.165(a)(11) requires emission offsets to be
obtained for the same regulated NSR pollutant, unless interprecursor
offsetting is permitted for a particular pollutant, as further
specified in the rule. ADEQ's NA-NSR SIP submittal does not address
interprecursor offsets, and it is not required to, but the submittal
does not contain a specific requirement that offsets must be for the
same regulated pollutant.
Eighth, 40 CFR 51.165(b) requires that ADEQ have a preconstruction
program that satisfies the requirements of section 110(a)(2)(D)(i) of
the Act for any new major stationary source or major modification that
would locate in an attainment area, but would cause or contribute to a
violation of a NAAQS in any adjacent area. ADEQ's program contains
provisions for 40 CFR 51.165(b) at R18-2-406(A)(5)(a)-(b) that
generally meet this requirement. However, ADEQ's regulations at R18-2-
406(A)(5)(b) refer to the ``Arizona primary or secondary ambient air
quality standards,'' which is not a defined term, whereas the analogous
federal program provisions refer to the NAAQS. As a result, ADEQ's
program does not fully meet the requirements in 40 CFR 51.165(b)(1) and
(2) as ADEQ's regulations do not make clear which standards are being
referred to, and the submittal does not demonstrate that such standards
would apply to areas outside of Arizona for purposes of ADEQ's NSR
review. Similarly, ADEQ's regulation at R18-2-406(A)(5)(a) references
the state's ambient air quality standards in Article 2, which would not
clearly apply to areas outside of Arizona.
Finally, Section 173(a)(4) of the Act requires that NA-NSR permit
programs shall provide that permits to construct and operate may be
issued if ``the Administrator has not determined that the applicable
implementation plan is not being adequately implemented for the
nonattainment area in which the proposed source is to be constructed or
modified.'' However, ADEQ's program does not contain a provision that
would prohibit the issuance of NA-NSR permits in areas where the
Administrator has made this determination or that requires that ADEQ
conduct a review to ensure that this requirement is met. To obtain full
program approval, ADEQ must add a provision to its NA-NSR program
requirements that ensures compliance with CAA section 173(a)(4).
2. Plantwide Applicability Limits
ADEQ's rules contain provisions for using plantwide applicability
limits (PALs) in R18-2-412. We have identified the following
deficiencies with ADEQ's PALs provisions program as they relate to the
NA-NSR program.
First, ADEQ's provision for PALs does not specify that
modifications under a PAL do not need approval through the
nonattainment major NSR program. Only the PSD program is mentioned.
ADEQ's submittal does not contain a definition for nonattainment major
NSR program (see 40 CFR 51.165(a)(1)(xxx)). ADEQ should either add this
definition or considering referencing R18-2-403. See 40 CFR
51.165(f)(1)(iii)(B).
Second, neither the ADEQ regulatory provisions for PALs at R18-2-
412 nor the ADEQ regulatory definitions in R18-2-401 that apply in the
context of major sources and major modifications contain a definition
for major emissions unit as is required by 40 CFR 51.165(f)(2)(iv).
Third, ADEQ's PAL provision for calculating baseline emissions at
R18-2-412(B)(2) does not specify that baseline actual emissions are to
include emissions associated not only with operation of the unit, but
also emissions associated with startup, shutdown and malfunction, as is
required by 40 CFR 51.165(f)(3)(ii).
Fourth, ADEQ's PAL provisions at R18-2-412(H) contain an incorrect
reference to R18-2-412(H)(4) instead of the definition for major
modification, and R18-2-412(H)(5) uses ``eliminated'' where the federal
regulation uses ``established.'' See 40 CFR 51.165(f)(9).
Finally, ADEQ's program contains incorrect cross-references in
meeting the requirements of 40 CFR 51.165(f)(1), as follows: ADEQ's PAL
renewal provisions at R18-2-412(I)(1) must contain a reference to
subsection (D) of R18-2-412 instead of (F), and R18-2-(I)(4)(a) must
reference subsection (E) of R18-2-412.
3. Definitions
ADEQ's submittal contains definitions applicable to the
nonattainment NSR program that do not fully meet the requirements of 40
CFR 51.165(a)(1), which requires each State plan to contain specific
definitions for the nonattainment NSR program. Deviations from the
wording are approvable if the State specifically demonstrates that the
submitted definition is more stringent, or at least as stringent, in
all respects as the corresponding definition in 40 CFR 51.165(a)(1). We
have carefully reviewed the definitions used in ADEQ's nonattainment
NSR program as compared with the federal PSD definitions in 40 CFR
51.165(a)(1) and have found that generally, ADEQ's submittal contains
the definitions necessary to implement a NA-NSR program. However, a
number of ADEQ's definitions do not meet the requirements of 40 CFR
51.165(a)(1) because their wording deviates from the wording in the
corresponding federal regulatory definitions in 40 CFR 51.165(a)(1) in
a manner that may be less stringent than the federal definitions, and
the State has not demonstrated otherwise.
Stationary source at 40 CFR 51.165(a)(1)(i)--the federal regulation
at 40 CFR 51.165(a)(1)(i) defines this term as ``any building,
structure, facility or installation which emits or may emit a regulated
NSR pollutant,'' with ``regulated NSR pollutant'' also being a
federally defined term at 40 CFR 51.165(a)(1)(xxxvii), whereas ADEQ's
regulation at R18-2-101(139) defines ``stationary source'' as ``any
building, structure, facility or installation subject to regulation
pursuant to A.R.S. Sec. 49-426(A) which emits or may emit any air
pollutant,'' with ``air pollutant'' being an undefined term in ADEQ's
regulation. However, A.R.S. Sec. 49-426(A) provides a cross-reference
to certain exemptions from permitting identified in A.R.S. Sec. 49-
426(B), specifically agricultural equipment used in normal farm
operations and certain fuel burning equipment, which do not appear to
be consistent with federal NA-NSR definition. The federal definition of
stationary source at 40 CFR 51.165(a)(1)(i) is very broad and does not
exclude these source categories from the definition. We agree that it
is acceptable for ADEQ to limit its NSR program to certain kinds of
stationary sources, as discussed in detail above with respect to 40 CFR
51.160(e), but the federal definition for a stationary source in the
context of the major NA-NSR program is not the appropriate place for
such an exclusion, as it does not allow exclusions for certain source
categories. ADEQ must demonstrate that its definition of stationary
source is at least as stringent as the federal definition at 40 CFR
51.165(a)(1)(i) in all respects.
Major stationary source at 40 CFR 51.165(a)(1)(iv)--language from
subparagraph 40 CFR 51.165(a)(1)(iv)(A)(3) not included in the
definition at R18-2-101(75); also see comments above on definition of
[[Page 14057]]
``stationary source'' in 40 CFR 51.165(a)(1)(i).
Net emissions increase at 40 CFR 51.165(a)(1)(vi)--The requirement
of paragraph 40 CFR 51.165(a)(1)(vi)(E)(3) is not met because not all
requirements to be approved under subpart I are listed (i.e., R18-2-
302.01) in the definition at R18-2-101(87). In addition, the equivalent
of paragraph 40 CFR 51.165(a)(1)(vi)(G) is not included in ADEQ's
definition at R18-2-101(87).
Significant at 40 CFR 51.165(a)(1)(x)--ADEQ's definition at R18-2-
101(130)(b) refers to R18-2-405 for determining significant emissions
in serious and severe ozone nonattainment areas. The definition for
``significant'' at R18-2-405(B) does not use the term ``net emissions
increase,'' which is a term defined by the federal regulations at 40
CFR 51.165(a)(1)(vi).
Allowable emissions at 40 CFR 51.165(a)(1)(xi)--ADEQ's definition
at R18-2-101(13)(b) does not include the ``future compliance date''
language that is in 40 CFR 51.165(a)(1)(xi)(B) and (C) and ADEQ has not
demonstrated that its regulatory language is at least as stringent as
the federal definition.
Federally enforceable at 40 CFR 51.165(a)(1)(xiv)--ADEQ's
definition at R18-2-101(53)(d) identifies that requirements included in
permits pursuant to R18-2-306.01 or R18-2-306.02 are included in the
definition of federally enforceable requirements, but excludes those
requirements that are identified as ``enforceable only by the state.''
With this action, we are approving R18-2-306.01 and R18-2-306.02 into
the SIP, making requirements pursuant to these rules federally
enforceable. As such, ADEQ does not have the discretion to identify
some of those requirements as only enforceable by the state.
Regulated NSR pollutant at 40 CFR 51.165(a)(1)(xxxvii)--ADEQ's
definition is missing this language from paragraph 40 CFR
51.165(a)(1)(xxxvii)(C): ``provided that such constituent or precursor
pollutant may only be regulated under NSR as part of regulation of the
general pollutant'' at R18-2-101(122)(a).
Projected actual emissions at 40 CFR 51.165(a)(1)(xxviii)--ADEQ's
definition at R18-2-401(20)(b)(iii) does not specifically require
inclusion of emissions from malfunctions in the determination of
projected actual emissions, and exempts emissions from a shutdown
associated with a malfunction from such determination, while the
federal definition at 40 CFR 51.165(a)(1)(xxxvii)(C) requires that
emissions from both shutdowns and malfunctions be included.
4. Definition for Basic Design Parameter
ADEQ's submittal contains a definition for basic design parameter
at R18-2-401(3) that reflects the definition that EPA originally
developed as part of its Equipment Replacement Provisions. See 68 FR
61248, Oct. 27, 2003. However, the definition for basic design
parameter, and other elements related to the Equipment Replacement
Provisions, were vacated by the DC Circuit Court of Appeals in State of
New York v. EPA, 443 F.3d 880 (D.C. Cir. 2006). While the federal NA-
NSR regulations still contain a reference to ``basic design
parameter,'' this term is no longer specifically defined under the
federal NA-NSR regulations, and application of the definition contained
in the Equipment Replacement Provisions that were vacated by the Court
of Appeals is inconsistent with federal NA-NSR requirements. As the
Court of Appeals found this Equipment Replacement Provisions and,
therefore, this definition, impermissible, and because ADEQ's
regulation incorporating this definition is a separable portion of
ADEQ's NA-NSR program, we are proposing a partial disapproval of ADEQ's
submitted NA-NSR program, to disapprove R18-2-401(3).
5. Additional Provisions for Particulate Matter Nonattainment Areas
On January 4, 2013, the U.S. Court of Appeals for the District of
Columbia Circuit, in Natural Resources Defense Council v. EPA,\20\
issued a decision that remanded the EPA's 2007 and 2008 rules
implementing the 1997 PM2.5 NAAQS. EPA's 2008 implementation
rule addressed by the court decision, ``Implementation of New Source
Review (NSR) Program for Particulate Matter Less Than 2.5 Micrometers
(PM2.5)'' (the 2008 NSR PM2.5 Rule),\21\
promulgated NSR requirements for implementation of PM2.5 in
both nonattainment areas (under the NA-NSR program) and attainment/
unclassifiable areas (under the PSD program). The Court of Appeals
found that EPA erred in implementing the PM2.5 NAAQS in
these rules for nonattainment areas solely pursuant to the general
implementation provisions of subpart 1 of part D of title I of the CAA,
rather than pursuant to the additional implementation provisions
specific to particulate matter nonattainment areas in subpart 4. The
Court of Appeals ordered the EPA to ``repromulgate these rules pursuant
to Subpart 4 consistent with this opinion.'' 706 F.3d at 437. Although
the Court of Appeals declined to establish a deadline for EPA's
response to the remand, EPA intends to promulgate new generally
applicable implementation regulations for the PM2.5 NAAQS in
accordance with the requirements of subpart 4. In the interim, however,
states and EPA still need to proceed with implementation of the
PM2.5 NAAQS in a timely and effective fashion in order to
meet statutory obligations under the CAA and to assure the protection
of public health intended by those NAAQS.
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\20\ 706 F.3d 428 (D.C. Cir. 2013).
\21\ 73 FR 28321 May 16, 2008.
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ADEQ's NSR SIP submittal generally includes requirements for the
PM2.5 NA-NSR program consistent with the provisions
promulgated in the 2008 NSR PM2.5 Rule. Specifically, ADEQ's
NSR SIP submittal includes the PM2.5 significant emission
rates at R18-2-101(130), regulation of certain PM2.5
precursors (SO2 and NOX) at R18-2-101(130), the
regulation of PM10 and PM2.5 condensable
emissions at R18-2-101(122)(f), and the emissions offset requirements
at R18-2-403(A)(3). Separate and aside from the issues identified above
that have resulted in our proposing limited approval and limited
disapproval of ADEQ's NA-NSR submittal, EPA has determined that it is
not prepared at this time to grant full approval to ADEQ's NSR SIP
submittal as to the PM2.5 NA-NSR program requirements, in
light of the Court's remand of the 2008 NSR PM2.5 Rule, and
for the reasons explained below.
EPA is in the process of evaluating the requirements of subpart 4
as they pertain to NA-NSR. In particular, subpart 4 includes section
189(e) of the CAA, which requires the control of major stationary
sources of PM10 precursors (and hence under the court
decision, PM2.5 precursors) ``except where the Administrator
determines that such sources do not contribute significantly to PM-10
levels which exceed the standard in the area.'' Although ADEQ's NSR SIP
submittal does include regulation of SO2 and NOX
as PM2.5 precursors, it does not include the regulation of
VOCs or ammonia. Nor does the NSR SIP submittal include a demonstration
as to whether or not the regulation of VOCs or ammonia is necessary
under section 189(e). The evaluation of which precursors need to be
controlled to achieve the standard in a particular area is typically
conducted in the context of the state's preparing and the EPA's
reviewing an area's attainment plan SIP. In this case, there are two
designated PM2.5 nonattainment areas in Arizona, the Nogales
(portion of Santa Cruz County, AZ) and West Central Pinal (portion of
Pinal County, AZ) areas. Both are designated
[[Page 14058]]
nonattainment for the 2006 annual PM2.5 NAAQS. However, on
January 7, 2013 and September 4, 2013, EPA finalized determinations of
attainment for these areas, respectively (78 FR 887 and 78 FR 54394),
which suspended the requirement for the state to submit, among other
things, an attainment plan SIP for the area.\22\ Accordingly,
PM2.5 attainment plans for SIP approval are not currently
before Region 9 for these areas. As Region 9 does not have before it
the state's analysis as to which precursors need to be controlled in
these areas pursuant to section 189(e) of the Act, as would be
generally contained in an attainment plan SIP, it cannot fully approve
as complying with the CAA a nonattainment NSR SIP that only addresses a
subset of the scientific PM2.5 precursors recognized by EPA.
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\22\ Prior to the Court's decision, EPA would not have reviewed
PM2.5 attainment plan submittals for compliance with
Section 189.
---------------------------------------------------------------------------
On the other hand, while ADEQ's submittal may not yet contain all
of the elements necessary to satisfy the CAA requirements when
evaluated under subpart 4, the NA-NSR SIP submittal represents a
considerable strengthening of the currently approved Arizona SIP, which
does not address NSR permitting for PM2.5 at all. Therefore,
EPA is proposing to grant limited approval to the PM2.5 NA-
NSR provisions in ADEQ's NSR submittal for the Nogales and West Central
Pinal PM2.5 nonattainment areas.
For the reasons explained above, EPA is not evaluating at this time
whether ADEQ's NA-NSR submittal will require additional revisions
relating to PM2.5 to satisfy the subpart 4 requirements.
Once EPA re-promulgates the Federal PM2.5 regulations with
respect to NA-NSR permitting in response to the Court's remand, EPA
will consider whether a limited disapproval should also be proposed for
ADEQ's PM2.5 NA-NSR program based on this issue.
In addition, section 189(e) of the CAA requires that ADEQ's NSR
program for PM10 nonattainment areas apply to major
stationary sources of PM10 precursors, except where the
Administrator determines that such sources do not contribute
significantly to PM10 levels which exceed the standard in
the area. As discussed below, we have identified one area under ADEQ's
jurisdiction, the West Pinal PM10 nonattainment area, for
which we are proposing a limited approval with respect to
PM10 under section 189(e) of the Act.
On September 4, 2013, the West Pinal area was redesignated to
nonattainment for the 1987 p.m.10 standard. ADEQ's NSR SIP
submittal generally includes NA-NSR requirements for PM10
nonattainment areas such as the PM10 significant emission
rate at R18-2-101(130), the regulation of PM10 and
PM2.5 condensable emissions at R18-2-101(122)(f), and the
emissions offset requirements at R18-2-403(A)(3). However, separate and
aside from the issues identified above that have resulted in our
proposing limited approval and limited disapproval of ADEQ's NA-NSR
submittal, EPA has determined that it is not prepared at this time to
grant full approval to ADEQ's NSR SIP submittal as to the
PM10 nonattainment NSR program requirements for the West
Pinal nonattainment area. The evaluation of which precursors need to be
controlled to achieve the standard in a particular area is typically
conducted in the context of the state's preparing and the EPA's
reviewing of an area's attainment plan SIP. On February 19, 2014, ADEQ
withdrew from EPA's consideration the Arizona State Implementation Plan
Revision for the West Pinal County PM10 Nonattainment Area
(submitted on December 30, 2013). Accordingly, a PM10
attainment plan for West Pinal is not currently before Region 9. As
such, Region 9 does not have before it the state's analysis as to which
precursors need to be controlled in this area pursuant to section
189(e) of the Act, as would be generally contained in an attainment
plan SIP, and cannot fully approve as complying with the CAA a
nonattainment NSR SIP that does not address scientific PM10
precursors recognized by EPA.
While ADEQ's submittal may not yet contain all of the elements
necessary to satisfy the CAA NA-NSR requirements when evaluated under
subpart 4, the proposed revisions to ADEQ's NA-NSR program represent a
considerable strengthening of the currently approved Arizona SIP, which
does not address NSR requirements for PM10 at all.
Therefore, EPA is proposing to grant limited approval to the
PM10 NA-NSR provisions in ADEQ's NSR submittal as they apply
to the West Pinal nonattainment area. Once ADEQ submits a new
PM10 attainment plan for this area, EPA will consider
whether a limited disapproval should also be proposed based on this
issue.
E. Review of Non-NSR Related Rules and Statutory Provisions
In addition to ADEQ's NSR SIP submittal, we are taking action on
rules R18-2-311 and R18-2-312. These rules were submitted to EPA for
SIP approval in a separate submittal on July 28, 2011. We delayed
acting on rules R18-2-311 and R18-2-312 in a previous action, and are
therefore now evaluating and taking action on the rules. We are also
taking action on A.R.S. Sec. 49-107, an Arizona statutory provision
concerning local delegation of state authority.
First, ADEQ's rule R18-2-311 specifies the test methods and
procedures which can be used to determine compliance with requirements
established under ADEQ's air program. On October 19, 1984, EPA approved
an earlier version of this rule into the SIP.\23\ See 49 FR 41026. The
current submittal, adopted effective November 15, 1993, renumbers the
earlier rule and expands on the previous version by listing additional
test methods that may be used to determine compliance. While the
current rule improves on the earlier version, we cannot recommend it
for full approval into the SIP. We are proposing a limited disapproval
because Section D of the rule allows the State to approve alternatives
to the applicable SIP without EPA approval, in conflict with the
requirements of CAA sections 110(a)(2)(A) and 110(i).\24\
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\23\ The rule was previously numbered R9-3-310.
\24\ See, e.g., ``Guidance Document for Correcting VOC Rule
Deficiencies,'' U.S. EPA Region 9, April 1991, revised August 21,
2001 (Little Bluebook).
---------------------------------------------------------------------------
Second, ADEQ's rule R18-2-312 requires stationary sources to
conduct a performance test within 60 days of achieving the capability
to operate at its maximum production rate, but no later than 180 days
after initial start-up. The rule also specifies that testing shall be
conducted under such conditions specified by State, including, but not
limited to appropriate test methods, notification to the State, data
reduction, records, and number of test runs. On April 23, 1982 (47 FR
17485) EPA approved a version of this rule into the SIP.\25\ The
current submittal, adopted effective November 15, 1993, renumbers the
earlier rule and expands on the previous version by including
conditions when a test may be stopped and allows compliance to be
determined with continuous emission monitoring as long as the
applicable quality assurance procedures are followed. While the current
rule improves on the earlier version, we cannot recommend it for full
approval into the SIP. We are proposing a limited disapproval because
Section B of the rule allows the State to approve the use of equivalent
and alternative test methods without EPA approval, in conflict with CAA
sections 110(a)(2)(A) and 110(i).\26\
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\25\ The rule was previously numbered R9-3-312.
\26\ See, e.g., Little Bluebook.
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[[Page 14059]]
Third, A.R.S. Sec. 49-107 is the current Arizona state law that
provides ADEQ with authority to ``delegate to a local environmental
agency, county health department, public health services district or
municipality any functions, powers or duties which the director
believes can be competently, efficiently and properly performed by the
local agency if the local agency accepts the delegation and agrees to
perform the delegated functions, powers and duties according to the
standards of performance required by law and prescribed by the
director,'' and other related authorities. This statutory provision
establishes that ADEQ has clear authority to delegate various functions
under the CAA, including NSR permitting, to county and other local
government agencies and, as such, we find it to be approvable and
propose to approve it into the SIP. This provision will replace 7-1-
8.3(R9-3-803)--Delegation of Authority, an older ADEQ currently in the
SIP, which we are proposing to remove from the SIP as part of this
action.
F. Review of Rules and Statutory Provisions Requested To Be Removed
From the SIP
In Table 2 of this preamble we identify the rules and statutory
provisions we are proposing to remove or supersede from the SIP as part
of this action. ADEQ's existing SIP-approved NSR rules are generally
outdated, as we have not acted to approve substantial revisions to
ADEQ's NSR rules since the 1980s. Further, the ADEQ NSR rules currently
in the SIP have been repealed for purposes of State law by ADEQ.
Significant changes have been made to the Act and the underlying
implementing federal NSR regulations since our last substantial action
on ADEQ's NSR SIP. Therefore, replacing the existing, outdated NSR SIP
rules with the updated ADEQ rules in this submittal that we propose to
approve into the SIP is appropriate and generally serves as an overall
strengthening of Arizona's SIP. In some cases, we approved updated
versions of these rules into the SIP in previous rulemaking actions,
and a few of the rules proposed for removal are no longer necessary for
other reasons. Our TSD provides additional detail.
G. Do the rules meet the evaluation criteria under Section 110(l) and
193 of the Act?
CAA Section 110(l) states: ``Each revision to an implementation
plan submitted by a State under this chapter shall be adopted by such
State after reasonable notice and public hearing. The Administrator
shall not approve a revision of a plan if the revision would interfere
with any applicable requirement concerning attainment and reasonable
further progress (as defined in section 7501 of this title), or any
other applicable requirement of this chapter.''
With respect to the procedural requirements of CAA section 110(l),
based on our review of the public process documentation included in the
July 28, 2011, October 29, 2012 and July 2, 2014 submittals, we find
that ADEQ has provided sufficient evidence of public notice and
opportunity for comment and public hearings prior to submittal of this
SIP revision and has satisfied these procedural requirements under CAA
section 110(l).
With respect to the substantive requirements of section 110(l), as
discussed further below, we have determined that our approval of the
ADEQ NSR SIP Submittal and the other rules and statutory provisions
that we are proposing to act on in this action (including but not
limited to the rescission of numerous existing NSR SIP rules), as
described above in this preamble, would strengthen the applicable SIP
in most respects. Taken in its entirety, we find that the SIP revision
represents a strengthening of ADEQ's minor NSR, PSD, and NA-NSR
programs as compared to the existing SIP-approved NSR program for ADEQ
that was last substantially revised in the SIP in the early 1980s, and
that our approval of this SIP submittal would not interfere with any
applicable requirement concerning attainment and reasonable further
progress (RFP) or any other applicable requirement of the Act.
First, this proposed action would correct a number of deficiencies
in ADEQ's current SIP-approved NSR program. ADEQ's existing SIP-
approved program does not currently contain these significant program
elements: (1) Implementation of NSR requirements for PM10;
(2) implementation of NSR requirements for PM2.5; (3)
regulation of NOX as a precursor to ozone; (4) inclusion of
condensable particular matter in NSR permitting for determining
PM10 and PM2.5 emissions; and (5) ensuring that
the construction or modification of certain non-major sources and non-
major modifications will (1) not interfere with attainment or
maintenance of the NAAQS and (2) comply with the applicable SIP.
Further, ADEQ has also updated its program to provide for
additional permitting flexibilities that have been added to the federal
NSR program, such as PALs and the 2002 NSR Reforms.
Second, most of the deficiencies identified with the ADEQ rule
provisions on which we are taking action fit into one of two
categories: (1) Deficiencies that relate to an NSR program element that
has been added since ADEQ's NSR program was approved into the SIP
(e.g., the deficiency related to the omission of the definition for
major emissions unit in the PALs provisions), or (2) deficiencies that
exist in the current SIP that were not identified as deficiencies when
the provisions were approved into the SIP (e.g., ensuring protection of
the NAAQS in areas outside of Arizona from stationary source emissions
regulated under the NSR program). Therefore, in considering whether our
proposed approval of the NSR SIP submittal will interfere with
attainment or reasonable further progress, we only consider those
deficiencies in the first category, as the deficiencies in the second
category are already a part of the current applicable requirements for
attainment and RFP in the Arizona SIP. In many cases, the deficiencies
in the second category occurred because of the numerous changes to the
NSR program since ADEQ's NSR rules were last approved into the SIP.
That is, language that may have been approvable previously is no longer
approvable.
The most significant deficiency that we have identified, as
discussed in detail above in this notice, is the absence of provisions
that ensure protection of the 2012 PM2.5 NAAQS for the PSD
program. This deficiency is the most likely to affect the substantive
requirements of the overall application of the PSD program, compared to
other deficiencies that we do not expect would significantly affect the
review of emission impacts (e.g., administrative requirements for
permit issuance). However, the 2012 PM2.5 NAAQS came into
effect after ADEQ submitted the NSR SIP submittal to EPA. In addition,
although such standard is currently applicable in the context of the
PSD program, the implementation requirements for this standard are not
due until 2016. Accordingly, there are no applicable requirements in
the existing ADEQ SIP-approved NSR program related to this NAAQS that
would be affected by the deficiencies in the submitted NSR rules we are
approving.
In addition, ADEQ has relaxed its definition of ``major stationary
source.'' ADEQ's previous definition applied the PSD and NA-NSR program
requirements to existing non-major sources when a project would cause
such a stationary source to become a ``major stationary source.'' ADEQ
[[Page 14060]]
revised its program to instead subject existing non-major sources to
the major NSR program only if the project constitutes a ``major
stationary source'' in and of itself, consistent with federal NSR
program requirements. We do not find this relaxation to interfere with
attainment or reasonable further progress because ADEQ is also
strengthening its minor NSR program to address emissions from larger
modifications that do not qualify as major modifications under ADEQ's
revised NSR program. While these modifications would no longer be
subject to the major NSR program, ADEQ's minor NSR program would
nonetheless apply and ensure the modification does not interfere with
attainment or RFP.
In summary, we find that, on balance, the improvements ADEQ is
making to its NSR program and other portions of the SIP that are the
subject of this section outweigh the deficiencies discussed above as
compared to ADEQ's existing SIP-approved NSR program. In addition, we
are unaware of any reliance by ADEQ on the continuation of any specific
aspect of the permit-related rules currently in the ADEQ portion of the
Arizona SIP for the purpose of continued attainment or maintenance of
the NAAQS. Given all these considerations, we propose to conclude that
our approval of the ADEQ regulations and statute that are the subject
of this action into the Arizona SIP would not interfere with any
applicable requirement concerning attainment and RFP or any other
applicable requirement of the Act.\27\
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\27\ Our analysis and conclusion here also apply to our approval
of R18-2-311 and R18-2-312, which are not generally related to NSR
permitting. We note that these rules do not contain any substantive
changes in the procedures for performance tests or test methods as
compared with the analogous rules in the current SIP. Similarly, our
analysis and conclusion here also extends to our approval of A.R.S.
Sec. 49-107 into the SIP. The provisions in this state statute
relate specifically to local delegation of state authority and thus
would not interfere with any applicable requirement concerning
attainment and RFP or any other applicable requirement of the Act.
---------------------------------------------------------------------------
Conclusion. For the reasons set forth above, we can approve the
ADEQ SIP revision as proposed in this action under section 110(l) of
the Act.
Section 193 of the Act, which was added by the CAA Amendments of
1990, includes a savings clause that provides, in pertinent part: ``No
control requirement in effect, or required to be adopted by an order,
settlement agreement, or plan in effect before November 15, 1990, in
any area which is a nonattainment area for any air pollutant may be
modified after November 15, 1990, in any manner unless the modification
insures equivalent or greater emission reductions of such air
pollutant.''
We find that the provisions included in ADEQ's NSR SIP submittal
would ensure equivalent or greater emission reductions compared to the
SIP-approved NSR program in the nonattainment areas under ADEQ's
jurisdiction. In particular, the NSR provisions in ADEQ's NSR SIP
submittal cover stationary sources in areas that are nonattainment for
the PM10, PM2.5 and 1-hr SO2 NAAQS.
ADEQ's current SIP-approved NSR program was approved prior to EPA
establishing these NAAQS and the current NSR provisions in the SIP do
not reference the current, recently SIP-approved Arizona air quality
standards that are comparable to these NAAQS. In addition, ADEQ's
updated NSR rules and our action to approve them into the SIP will
expand ADEQ's review of minor sources in nonattainment areas to require
review of smaller sources. We therefore conclude that ADEQ's NSR SIP
submittal will provide for equivalent or greater emissions reductions
as compared to the existing SIP-approved ADEQ NSR program for the
nonattainment pollutants PM10, PM2.5 and
SO2.
Conclusion. For the reasons set forth above, we can approve the
submitted NSR program under section 193 of the Act.
H. 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 NSR SIP submittal. 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 ADEQ's jurisdiction in Arizona. In addition,
we are also proposing to remove the existing statutes and rules listed
in Table 2 from the SIP, which are outdated and mostly being superseded
by our proposed action. As discussed above, we are proposing a partial
disapproval of two elements of ADEQ's program, which have been vacated
from the PSD program (and is one case also from the NA-NSR program) by
the courts. We are also proposing a limited approval of ADEQ's
nonattainment NSR program for the Nogales and West Central Pinal
PM2.5 nonattainment areas and the West Pinal PM10
nonattainment area under section 189(e) of the Act. Finally, we are
proposing a limited approval and limited disapproval of two ADEQ rules
relating to test methods and procedures and performance tests, and
proposing to approve into the SIP an Arizona statutory provision
relating to local delegation of state authority.
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 ADEQ portion of the Arizona SIP that govern
preconstruction review and the issuance of preconstruction permits for
stationary sources, including the 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 ADEQ regulations listed in Table 1,
above, as a revision to the ADEQ portion of the Arizona SIP. We are
also proposing to remove the existing statutes and rules listed in
Table 2 from the SIP, which are outdated and mostly being superseded by
our proposed action. In addition, we are also proposing to partially
disapprove two provisions of ADEQ's NSR program that have been vacated
by the courts. We are proposing a limited approval of ADEQ's
nonattainment NSR program in certain nonattainment areas under section
189 of the Act related to PM10 and PM2.5
precursors. Finally, we are proposing a limited approval and limited
disapproval of two ADEQ rules relating to test methods and procedures
and performance tests, and proposing to approve into the SIP an Arizona
statutory provision relating to local delegation of state authority.
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 our proposed limited approval and limited
disapproval action is to update the applicable SIP with current ADEQ
[[Page 14061]]
regulations and to set the stage for remedying deficiencies in these
regulations.
If finalized as proposed, our limited disapproval action would
trigger an obligation on EPA to promulgate a Federal Implementation
Plan unless the State of Arizona 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 ADEQ
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
Arizona submits and we approve, prior to the implementation of the
sanctions, SIP revisions that correct the deficiencies that we identify
in our final action. The EPA intends to work with ADEQ to correct the
deficiencies identified in this action in a timely manner.
We will accept comments from the public on this proposed action for
the next 30 days.
IV. Incorporation by Reference
In this rule, the EPA is proposing to include in a final EPA rule
regulatory text that includes incorporation by reference. In accordance
with requirements of 1 CFR 51.5, the EPA is proposing to incorporate by
reference the ADEQ rules and Arizona statutory provisions listed in
Table 1 of this preamble. The EPA has made, and will continue to make,
these documents generally available electronically through
www.regulations.gov and/or in hard copy at the appropriate EPA office
(see the ADDRESSES section of this preamble for more information).
V. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review
This proposed action is not a ``significant regulatory action''
under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993)
and is therefore not subject to review under Executive Orders 12866 and
13563 (76 FR 3821, January 21, 2011).
B. Paperwork Reduction Act
This action does not impose an information collection burden under
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.
Burden is defined at 5 CFR 1320.3(b).
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency
to conduct a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements unless the agency certifies
that the rule will not have a significant economic impact on a
substantial number of small entities. Small entities include small
businesses, small not-for-profit enterprises, and small governmental
jurisdictions.
This rule will not have a significant impact on a substantial
number of small entities because SIP approvals or disapprovals under
section 110 and subchapter I of the Clean Air Act do not create any new
requirements but simply approve or disapprove requirements that the
State is already imposing. Therefore, because EPA's proposed limited
approval/limited disapproval does not create any new requirements, I
certify that this action will not have a significant economic impact on
a substantial number of small entities.
Moreover, due to the nature of the Federal-State relationship under
the Clean Air Act, preparation of flexibility analysis would constitute
Federal inquiry into the economic reasonableness of State action. The
Clean Air Act forbids EPA to base its actions concerning SIPs on such
grounds. Union Electric Co., v. U.S. EPA, 427 U.S. 246, 255-66 (1976);
42 U.S.C. 7410(a)(2).
D. Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2
U.S.C. 1531-1538, requires Federal agencies, unless otherwise
prohibited by law, to assess the effects of their regulatory actions on
State, local, and tribal governments and the private sector. Federal
agencies must also develop a plan to provide notice to small
governments that might be significantly or uniquely affected by any
regulatory requirements. The plan must enable officials of affected
small governments to have meaningful and timely input in the
development of EPA regulatory proposals with significant Federal
intergovernmental mandates and must inform, educate, and advise small
governments on compliance with the regulatory requirements.
This proposed rule 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
in any one year. Thus, this rule is not subject to the requirements of
section 202 or 205 of UMRA. This Federal action proposes to approve and
disapprove pre-existing requirements under State or local law, and
imposes no new requirements.
This proposed 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. This proposed
rule does not impose regulatory requirements on any government entity.
E. Executive Order 13132, Federalism
This 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 in the distribution of power
and responsibilities among the various levels of government, as
specified in Executive Order 13132. In the spirit of Executive Order
13132, and consistent with EPA policy to promote communications between
EPA and State and local governments, EPA specifically solicits comment
on this proposed action from State and local officials.
F. Executive Order 13175, Coordination With Indian Tribal Governments
Under Executive Order 13175 (65 FR 67249, November 9, 2000), EPA
may not issue a regulation that has tribal implications, that imposes
substantial direct compliance costs, and that is not required by
statute, unless the federal government provides the funds necessary to
pay the direct compliance costs incurred by tribal governments, or EPA
consults with tribal officials early in the process of developing the
proposed regulation and develops a tribal summary impact statement.
This proposed rule does not have tribal implications, as specified
in Executive Order 13175. Thus, Executive Order 13175 does not apply to
this rule. EPA specifically solicits additional comment on this
proposed rule from tribal officials. The SIP is not approved to apply
on any Indian reservation land or in any other area where EPA or an
Indian tribe has demonstrated that a tribe has jurisdiction. In those
areas of Indian country, the rule does not have tribal implications and
will not impose substantial direct costs on tribal governments or
preempt tribal law as specified by Executive Order 13175.
G. Executive Order 13045, Protection of Children From Environmental
Health Risks and Safety Risks
EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997)
as
[[Page 14062]]
applying only to those regulatory actions that concern health or safety
risks, such that the analysis required under section 5-501 of the
Executive Order has the potential to influence the regulation. This
rule is not subject to Executive Order 13045, because it proposes to
approve a State rule implementing a Federal standard.
H. Executive Order 13211, Actions That Significantly Affect Energy
Supply, Distribution, or Use
This rule is not subject to Executive Order 13211, ``Actions
Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or Use'' (66 FR 28355, May 22, 2001) because it is not a
significant regulatory action under Executive Order 12866.
I. National Technology Transfer and Advancement Act
Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (NTTAA), Public Law 104-113, 12 (10) (15 U.S.C. 272 note)
directs EPA to use voluntary consensus standards (VCS) in its
regulatory activities unless to do so would be inconsistent with
applicable law or otherwise impractical. VCS are technical standards
(e.g., materials specifications, test methods, sampling procedures, and
business practices) that are developed or adopted by the VCS bodies.
The NTTAA directs EPA to provide Congress, through annual reports to
OMB, with explanations when the Agency decides not to use available and
applicable VCS. EPA believes that VCS are inapplicable to this action.
Today's action does not require the public to perform activities
conducive to the use of VCS.
J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Population
Executive Order (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 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
change the level of environmental protection for any affected
populations.
Dated: March 4, 2015.
Jared Blumenfeld,
Regional Administrator, Region IX.
[FR Doc. 2015-06143 Filed 3-17-15; 8:45 am]
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