[Federal Register Volume 66, Number 41 (Thursday, March 1, 2001)]
[Rules and Regulations]
[Pages 12974-12978]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-721]
[[Page 12973]]
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Part II
Environmental Protection Agency
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40 CFR Parts 72, 74, and 78
Acid Rain Program--Permits Rule Revision, Industrial Utility-Units
Exemption; Final Rule; Proposed Rule
Federal Register / Vol. 66 , No. 41 / Thursday, March 1, 2001 / Rules
and Regulations
[[Page 12974]]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Parts 72, 74, and 78
[FRL-6930-9]
Acid Rain Program--Permits Rule Revision, Industrial Utility-
Units Exemption
AGENCY: Environmental Protection Agency.
ACTION: Direct final rule.
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SUMMARY: The Environmental Protection Agency (EPA) is taking direct
final action to remove the provision for the industrial utility-units
exemption in the regulations for the Acid Rain Program under title IV
of the Clean Air Act (Act). The purpose of the Acid Rain Program is to
significantly reduce emissions of sulfur dioxide and nitrogen oxides
from utility electric generating plants in order to reduce the adverse
health and ecological effects of acidic deposition (or acid rain)
resulting from these emissions. In January 1993, EPA issued rules
implementing the program, including the permits rule. In October 1997,
EPA revised the permits rule in order to add, among other things, a
provision establishing a limited exemption from the program for certain
industrial boilers (referred to as ``industrial utility-units''). One
party filed a petition for review challenging the industrial utility-
units exemption. On August 23, 2000, EPA and the petitioning party
signed a settlement agreement addressing the exemption provision.
Today, EPA is removing the industrial utility-units exemption based on
a review of the record. This action is consistent with the August 23,
2000 settlement.
DATES: This rule is effective on May 10, 2001 without further notice,
unless EPA receives adverse comment by April 16, 2001. If we receive
such adverse comment, we will publish a timely withdrawal in the
Federal Register informing the public that this rule will not take
effect.
ADDRESSES: Comments: If you submit any written comments on this
proposed rule, the comments must reference Docket No. A-95-56 and must
be submitted in duplicate to EPA's Air and Radiation Docket and
Information Center (6102), 401 M Street, SW., Room M-1500, Washington,
DC 20460.
Docket. Docket No. A-95-56, containing supporting information used
in developing the direct final rule, is available for public inspection
and copying between 8:30 a.m. and 5:30 p.m., Monday through Friday, at
EPA's Air and Radiation Docket and Information Center (6102), 401 M
Street, SW., Room M-1500, Washington, DC 20460. EPA may charge a
reasonable fee for copying.
FOR FURTHER INFORMATION CONTACT: Dwight C. Alpern, at (202) 564-9151,
U.S. Environmental Protection Agency, 1200 Pennsylvania Ave., NW.,
(6204J), Washington, DC 20460; or the Acid Rain Hotline at (202) 564-
9089.
SUPPLEMENTARY INFORMATION: EPA is publishing this rule as a direct
final rule because we view this as a noncontroversial amendment and
anticipate no adverse comment. The rule, which removes the provision
for the industrial utility-units exemption, is consistent with a
settlement signed by EPA and the only party that petitioned for review
of the industrial utility-units exemption. However, in the ``Proposed
Rules'' section of today's Federal Register, we are publishing a
separate document that will serve as the proposed rule revision if we
receive any timely, adverse comments on today's direct final rule.
Today's direct final rule will be effective on May 10, 2001 without
further notice unless we receive adverse comment by April 16, 2001. If
we receive such adverse comment, we will publish a timely withdrawal in
the Federal Register informing the public that this rule will not take
effect. We will address all public comments in a subsequent final rule
based on the proposed rule. We will not institute a second comment
period on this action. Any parties interested in commenting must do so
at this time.
The information in this preamble is organized as follows:
I. Regulated Entities
II. Background
III. Rule Revision
IV. Administrative Requirements
A. Executive Order 12866: Regulatory Impacts Analysis
B. Regulatory Flexibility Act: Small Entity Impacts
C. Unfunded Mandates Reform Act
D. Paperwork Reduction Act
E. Executive Order 13045: Protection of Children from
Environmental Health Risks and Safety Risks
F. Executive Order 12898: Environmental Justice
G. Executive Order 13132: Federalism
H. Executive Order 13084: Consultation and Coordination with
Indian Tribal Governments
I. National Technology Transfer and Advancement Act
J. Submission to Congress and the General Accounting Office
I. Regulated Entities
Entities potentially regulated by this action are fossil-fuel fired
boilers or turbines that serve generators producing electricity for
sale. Regulated categories and entities include:
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Examples of regulated
Category entities
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NAICS Code: 221112, Fossil Fuel Electric Electric service providers,
Power Generation. boilers and turbines from a
wide range of industries.
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EPA does not intend this table to be exhaustive, but rather to
provide a guide for readers regarding entities likely to be regulated
by this action. This table lists the types of entities that, EPA is now
aware, this action could potentially affect. This action could also
affect other types of entities not listed in the table. To determine
whether this action affects your facility, you should carefully examine
the applicability criteria in Secs. 72.6 and 76.1 and the exemptions in
Secs. 72.7 and 72.8 of title 40 of the Code of Federal Regulations. If
you have questions regarding the applicability of this action to a
particular entity, consult the person listed in the FOR FURTHER
INFORMATION CONTACT section.
II. Background
Under title IV of the Act, ``utility units'' are subject to sulfur
dioxide (SO2) emission limitations (under sections 404, 405,
408, and 409) and must monitor SO2, NOX, carbon
dioxide (CO2), and opacity (under section 412)\1\. On
October 24, 1997, EPA issued a final rule establishing a limited
exemption from most Acid Rain Program requirements for certain
industrial boilers (``industrial utility-units'') that are not
cogeneration units and that generate small amounts of electricity for
sale. See 62 FR 55460, 55462-55466 and 55478-55480 (October 24, 1997).
A cogeneration unit is a unit that uses the same energy to produce
sequentially both: Thermal energy (heat or steam) that is used for
industrial, commercial, or heating or cooling purposes; and
electricity.
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\1\ See also section 821 of the Clean Air Act Amendments of
1990, 42 U.S.C. 7651k note (concerning monitoring of
CO2).
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Under the industrial utility-unit exemption in the existing rule,
the owners or operators of an industrial utility-unit that is not a
cogeneration unit and that meets several requirements specified in
Sec. 72.14 may apply for, and obtain from the permitting authority, an
exemption from most Acid Rain Program requirements. First, the existing
Sec. 72.14 requires that the unit must have no owner or operator whose
principal business is electricity
[[Page 12975]]
sale, transmission, or distribution or that is a public utility subject
to State or local utility regulation. Second, on or before March 23,
1993, the owners or operators of the unit must have entered into an
interconnection agreement with a company whose principal business is
electricity sale, transmission, or distribution or that is a public
utility subject to State or local utility regulation. The agreement
must require that the generator served by the unit produce electricity
for sale only for incidental sales. Third, in 1985 and any year
thereafter, the generator served by the unit must have actually
produced electricity for sale only for incidental sales to the public
utility. EPA defined ``incidental sales'' as annual sales not exceeding
the lesser of 10 percent of the output capacity of the generator or 10
percent of the actual annual electric output of the generator. See 62
FR 55478.
III. Rule Revision
After the issuance of the October 24, 1997 rule, one commenter
filed a petition for review of the rule. On August 23, 2000, EPA and
the commenter signed a settlement addressing the issues raised by the
petition for review.
The commenter's units were among the 15 units that, according to
EPA estimates in the October 24, 1997 rule, might qualify for the
industrial utility-unit exemption. See 62 FR 55463 n.7. In connection
with the petition for review, this party has raised significant
questions as to whether industrial utility-units that are covered by
the exemption provided in Sec. 72.14 are actually ``utility units'' and
would otherwise be subject to the Acid Rain Program. If such industrial
utility-units would not otherwise be subject to the Acid Rain Program,
then their owners or operators would not need to apply and qualify for
an exemption under Sec. 72.14. Indeed, there might not be any purpose
for retaining Sec. 72.14. In the rulemaking in which EPA proposed and
then adopted Sec. 72.14, these questions concerning whether industrial
utility-units were ``utility units'' were not raised or addressed in
any comprehensive way. Instead, the comments on the proposal and EPA's
analysis of the comments focused on the details of what requirements an
industrial utility-unit would have to meet in order to qualify for an
exemption from most Acid Rain Program requirements. See 62 FR 55463-
55466.
Under these circumstances, EPA concludes that the adoption of
Sec. 72.14 was premature. EPA believes that the underlying questions
concerning whether industrial utility-units are actually ``utility
units'' and would otherwise be subject to the Acid Rain Program should
be fully addressed before an exemption for such units is implemented.
Consequently, today's rule provides that Sec. 72.14 in the October 24,
1997 rule is vacated, all references to Sec. 72.14 in the parts 72-78
of the regulations (40 CFR parts 72-78) implementing the Acid Rain
Program under title IV of the Clean Air Act are removed, and the
portion of the preamble of the December 27, 1996 proposed rule
addressing Sec. 72.14 (i.e., section I.B.4 at 61 FR 68344-68347) and of
the October 24, 1997 rule addressing Sec. 72.14 (i.e., section II.B.3
of the preamble of the October 24, 1997 rule (62 FR 55462-55466)) is no
longer valid and should not be regarded as representing EPA's views.
This will provide EPA an opportunity to consider comments that
industrial-utility units (as defined in Sec. 72.14) are not affected
utility units under title IV of the Act and therefore do not need an
exemption from requirements of title IV. Further, EPA will not take any
further action on the provisions of Sec. 72.14 in the December 27, 1996
proposed rule or the portion of the preamble of the December 27, 1996
rule addressing Sec. 72.14 (i.e., section I.B.4 of the preamble of the
December 27, 1996 rule (61 FR 68344-68347)) without first promulgating
a new notice of proposed rulemaking that proposes such action and
without first providing a new opportunity for public comment on any
such new notice. EPA notes that today's rule is consistent with the
August 23, 2000 settlement.
IV. Administrative Requirements
A. Executive Order 12866: Regulatory Impacts Analysis
Under Executive Order 12866 (58 FR 51735 (October 4, 1993)), the
Agency must determine whether a regulatory action is ``significant''
and therefore subject to Office of Management and Budget (OMB) review
and the requirements of the Executive Order. The Order defines
``significant regulatory action'' as one that is likely to result in a
rule that may:
(1) Have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities;
(2) Create a serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
(3) Materially alter the budgetary impact of entitlements, grants,
user fees, or loan programs or the rights and obligations of recipients
thereof; or
(4) Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive Order.
It has been determined that today's final rule is not a
``significant regulatory action'' under the terms of Executive Order
12866 and, therefore, is not subject to OMB review.
B. Regulatory Flexibility Act: Small Entity Impacts
The Regulatory Flexibility Act (RFA), 5 U.S.C. 601, et seq., as
amended by the Small Business Regulatory Enforcement Fairness Act
(SBREFA), Public Law 104-121, generally requires the agency to prepare
a regulatory flexibility analysis of any rule subject to notice and
comment rulemaking requirements under the Administrative Procedure Act
or any other statute unless the agency certifies that the rule will not
have a significant, economic impact on a substantial number of small
entities. Such entities include small businesses, small organizations,
and small governmental jurisdictions.
Today's final rule will not significantly change the regulatory
burden or economic impact of the existing Acid Rain regulations on any
parties. When EPA promulgated the industrial utility-units exemption
provision, EPA concluded that the provision would not change the
overall economic impact of the Acid Rain regulations and would not have
a significant economic impact on a substantial number of small
entities. 62 FR 55474. EPA anticipated that the exemption would cover
about 15 units with 4 owners, who were unlikely to be small entities.
See 62 FR 55463 n. 7. Today's final rule vacates the industrial
utility-units exemption provision and similarly will not change the
overall economic impact of the Acid Rain regulations and will not have
a significant economic impact on a substantial number of small
entities.
For these reasons, I certify that today's final rule will not have
a significant, economic impact on a substantial number of small
entities.
C. Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local,
[[Page 12976]]
and tribal governments and the private sector. Under section 202 of the
UMRA, 2 U.S.C. 1532, EPA generally must prepare a written statement,
including a cost-benefit analysis, for any proposed or final rule with
``Federal mandates'' that may result in the expenditure by State,
local, and tribal governments, in the aggregate, or by the private
sector, of $100 million or more in any one year. Before promulgating an
EPA rule for which a written statement is needed, section 205 of the
UMRA generally requires EPA to identify and consider a reasonable
number of regulatory alternatives and adopt the least costly, most
cost-effective, or least burdensome alternative that achieves the
objectives of the rule. The provisions of section 205 do not apply when
they are inconsistent with applicable law. Moreover, section 205 allows
EPA to adopt an alternative other than the least costly, most cost
effective, or least burdensome alternative if the Administrator
publishes with the final rule an explanation why that alternative was
not adopted. Before EPA establishes any regulatory requirements that
may significantly or uniquely affect small governments, including
tribal governments, it must have developed under section 203 of the
UMRA a small government agency plan. The plan must provide for
notifying potentially affected small governments, enabling officials of
affected small governments to have meaningful and timely input in the
development of EPA regulatory proposals with significant Federal
intergovernmental mandates, and informing, educating, and advising
small governments on compliance with regulatory requirements.
The EPA has determined that today's final 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. Today's final rule will not
significantly change the regulatory burden or economic impact of the
existing Acid Rain regulations on any parties. When EPA promulgated the
industrial utility-units exemption provision, EPA concluded that the
provision would not change the overall economic impact of the Acid Rain
regulations and would not have a significant economic impact on a
substantial number of small entities. 62 FR 55474. EPA anticipated that
the exemption would cover about 15 units with 4 owners, who were
unlikely to be State, local, or tribal governments. See 62 FR 55463 n.
7. Today's final rule vacates the industrial utility-units exemption
provision and similarly will not change the overall economic impact of
the Acid Rain regulations. Accordingly, little or no additional costs
to State, local, or tribal governments in aggregate, or to the private
sector, will result from the final rule. Because today's rule is
estimated to result in the expenditure by State, local, and tribal
governments or the private sector of less than $100 million in any one
year, the Agency has not prepared a budgetary impact statement or
specifically addressed the selection of the least costly, most cost-
effective, or least burdensome alternative. Similarly, EPA has
determined that today's rule contains no regulatory requirements that
might significantly or uniquely affect small governments. Thus, today's
final rule is not subject to the requirements of sections 202, 203, or
205 of the UMRA.
D. Paperwork Reduction Act
Today's final revisions to part 72 will not impose any new
information collection burden subject to the Paperwork Reduction Act
(44 U.S.C. 3501, et seq.). OMB has previously approved the information
collection requirements contained in the permits rule, 40 CFR part 72,
under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501, et
seq. See OMB Control Number 2060-0258 (Acid Rain Program ICR No.
1633.12).
Today's final rule vacates the industrial utility-units exemption
and thus any information required to qualify and apply for the
exemption. Any units otherwise qualifying for the exemption that are
covered by the Acid Rain Program will have the same information
requirements as any other units subject to the Acid Rain Program. Those
requirements were previously approved.
Burden means the total time, effort, or financial resources
expended by persons to generate, maintain, retain, or disclose or
provide information to or for a Federal agency. This includes the time
needed to review instructions; develop, acquire, install, and utilize
technology and systems for the purposes of collecting, validating, and
verifying information, processing and maintaining information, and
disclosing and providing information; adjust the existing ways to
comply with any previously applicable instructions and requirements;
train personnel to be able to respond to a collection of information;
search data sources; complete and review the collection of information;
and transmit or otherwise disclose the information.
Copies of the previously approved ICR may be obtained from Sandy
Farmer, Collection Strategies Division; U.S. Environmental Protection
Agency (28822); 1200 Pennsylvania Ave., NW, Washington, DC 20460 or by
calling (202) 260-2740. Include the ICR and/or OMB number in any
correspondence.
E. Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks
Executive Order 13045 (62 FR 19885 (April 23, 1997) applies to any
rule that, EPA determines, (1) is ``economically significant'' as
defined under Executive Order 12866 and (2) concerns an environmental
health or safety risk that EPA has reason to believe may have a
disproportionate effect on children. If the regulatory action meets
both criteria, the Agency must evaluate the environmental health or
safety effects of the planned rule on children and explain why the
planned regulation is preferable to other potentially effective and
reasonably feasible alternatives considered by the Agency.
Today's final rule is not subject to Executive Order 13045 because
it is not ``economically significant'' as defined under Executive Order
12866. Further, the Agency does not have reason to believe that the
environmental health risks or safety risks addressed by this action
present a disproportionate risk to children.
F. Executive Order 12898: Environmental Justice
Executive Order 12898 requires that each Federal agency make
achieving environmental justice part of its mission by identifying and
addressing, as appropriate, disproportionately high and adverse human
health or environmental effects of its programs, policies, and
activities on minorities and low-income populations.
Today's final rule vacates the industrial utility-units exemption
provision. Neither the industrial utility-units exemption provision nor
the vacating of the provision has disproportionately high and adverse
human health or environmental effects on minorities and low-income
populations.
G. Executive Order 13132: Federalism
Executive Order 13132, entitled ``Federalism'' (64 FR 43255 (August
10, 1999), requires EPA to develop an accountable process to ensure
``meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications.''
``Policies that have federalism implications'' is defined in the
Executive Order to include regulations that have ``substantial direct
[[Page 12977]]
effects on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government.''
Today's final rule vacates the industrial utility-units exemption
provision. Neither the provision nor the vacating of the provision has
any federalism implications. This action will not have substantial
direct effects on the States, on the relationship between the national
governments and the States, or on the distribution of power and
responsibilities among the various levels of government, as specified
in Executive Order 13132. Thus, the requirements of section 6 of the
Executive Order do not apply to today's final rule.
H. Executive Order 13084: Consultation and Coordination With Indian
Tribal Governments
Under Executive Order 13084, EPA may not issue a regulation that is
not required by statute, that significantly or uniquely affects the
communities of Indian tribal governments, and that imposes substantial
direct compliance costs on those communities, unless the Federal
government provides the funds necessary to pay the direct compliance
costs incurred by the tribal governments, or EPA consults with those
governments. If EPA complies by consulting, Executive Order 13084
requires EPA to provide to OMB, in a separately identified section of
the preamble to the rule, a description of the extent of EPA's prior
consultation with representatives of affected tribal governments, a
summary of the nature of their concerns, and a statement supporting the
need to issue the regulation. In addition, Executive Order 13084
requires EPA to develop an effective process permitting elected
officials and other representatives of Indian tribal governments ``to
provide meaningful and timely input in the development of regulatory
policies on matters that significantly or uniquely affect their
communities.''
Today's final rule vacates the industrial utility-units exemption
provision. Neither the industrial utility-units exemption provision nor
the vacating of the provision significantly or uniquely affects the
communities of Indian tribal governments or imposes any direct
compliance costs on those communities. Accordingly, the requirements of
section 3(b) of Executive Order 13084 do not apply to this action.
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, section 12(d), 15 U.S.C. 272
note, directs EPA to use voluntary consensus standards in its
regulatory activities unless to do so would be inconsistent with
applicable law or otherwise impractical. Voluntary consensus standards
are technical standards (e.g., materials specifications, test methods,
sampling procedures, and business practices) that are developed or
adopted by voluntary consensus standards bodies. The NTTAA directs EPA
to provide Congress, through OMB, explanations when the Agency decides
not to use available and applicable voluntary consensus standards.
Today's final rule does not involve any technical standards.
Therefore, EPA is not considering the use of any voluntary consensus
standards.
J. Submission to Congress and the General Accounting Office
The Congressional Review Act, 5 U.S.C. 801, et seq., as added by
the Small Business Regulatory Enforcement Fairness Act of 1996,
generally provides that before a rule may take effect, the agency
promulgating the rule must submit a rule report, which includes a copy
of the rule, to each House of the Congress and to the Comptroller
General of the United States. EPA will submit a report containing
today's final rule and other required information to the U.S. Senate,
the U.S. House of Representatives, and the Comptroller General of the
United States prior to publication of the rule in the Federal Register.
A major rule cannot take effect until 60 days after it is published in
the Federal Register. Today's final rule is not a ``major rule'' as
defined by 5 U.S.C. 804(2).
[[Page 12978]]
List of Subjects in 40 CFR Parts 72, 74, and 78
Environmental protection, Acid rain program, Administrative
practice and procedure, Air pollution control, Electric utilities,
Permits, Reporting and recordkeeping requirements, Sulfur dioxide.
Dated: January 3, 2001.
Carol M. Browner,
Administrator.
For the reasons set out in the preamble, title 40, chapter I of the
Code of Federal Regulations is amended as follows:
PART 72--[AMENDED]
1. The authority citation for part 72 continues to read as follows:
Authority: 42 U.S.C. 7601 and 7651, et seq.
Sec. 72.6 [Amended]
2. Section 72.6 is amended in paragraph (b)(9) by revising the
words ``Sec. 72.7, Sec. 72.8, or Sec. 72.14'' wherever they occur to
read ``Sec. 72.7 or Sec. 72.8''.
Sec. 72.9 [Amended]
3. Section 72.9 is amended in paragraph (c)(6) by revising the
words ``Secs. 72.7, 72.8, or 72.14'' to read ``Sec. 72.7 or
Sec. 72.8''; paragraph (g)(1) by revising the words
``Sec. 72.7,Sec. 72.8, or Sec. 72.14'' by to read ``Sec. 72.7 or
Sec. 72.8''; and in paragraph (h) by revising the words ``Sec. 72.7,
Sec. 72.8, or Sec. 72.14'' to read ``Sec. 72.7 or Sec. 72.8''.
Sec. 72.14 [Removed]
4. Section 72.14 is removed.
Sec. 72.70 [Amended]
5. Section 72.70 is amended in paragraph (b) by removing the words
``or for issuing exemptions under Sec. 72.14''.
Sec. 72.72 [Amended]
6. Section 72.72 is amended by removing paragraph (b)(6).
Sec. 72.83 [Amended]
7. Section 72.83 is amended in paragraph (a)(13) by removing the
words ``or which was approved by the permitting authority under
Sec. 72.14''.
PART 74--[AMENDED]
The authority citation for part 74 continues to read as follows:
Authority: 42 U.S.C. 7601 and 7651, et seq.
Sec. 74.2 [Amended]
2. Section 74.2 is amended by revising the words ``Sec. 72.7,
Sec. 72.8, or Sec. 72.14'' to read ``Sec. 72.7 or Sec. 72.8''.
PART 78--[AMENDED]
1. The authority citation for part 78 continues to read as follows:
Authority: 42 U.S.C. 7601 and 7651, et seq.
Sec. 78.1 [Amended]
2. Section 78.1 is amended by removing and reserving paragraph
(b)(1)(v).
Sec. 78.12 [Amended]
3. Section 78.12 is amended by removing from paragraph (a)(2),
after the words ``an Acid Rain permit'', the words ``or an exemption
under Sec. 72.14 of this chapter''.
[FR Doc. 01-721 Filed 2-28-01; 8:45 am]
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