[Federal Register Volume 72, Number 176 (Wednesday, September 12, 2007)]
[Proposed Rules]
[Pages 52031-52038]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-17979]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52
[EPA-R04-OAR-2005-SC-0004-200735; FRL-8466-3]
Approval and Promulgation of Implementation Plans; South
Carolina; Prevention of Significant Deterioration and Nonattainment New
Source Review Rules
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed conditional approval.
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SUMMARY: EPA is proposing to partially approve, disapprove, and
conditionally approve specific portions of the proposed revisions to
the South Carolina State Implementation Plan (SIP) submitted by the
State of South Carolina on July 1, 2005. The proposed revisions modify
South Carolina's Prevention of Significant Deterioration (PSD) program
and provide for a new Nonattainment New Source Review (NNSR) program to
be incorporated into the SIP. EPA's proposal to partially approve and
disapprove certain portions of the July 1, 2005, SIP submittal is
consistent with section 110(k)(3) of the Clean Air Act (CAA). EPA's
proposal to conditionally approve other portions of the July 1, 2005,
SIP submittal is consistent with section 110(k)(4) of the CAA. As part
of the conditional approval, which applies only to the NNSR program,
South Carolina will have twelve months from the date of EPA's final
conditional approval of the SIP revisions in which to revise its NNSR
rules, as described herein, to be consistent with existing federal law.
In addition to the conditional approval of the NNSR program, EPA is
proposing to approve one provision of South Carolina's minor source
permitting program, partially approve South Carolina's PSD program, and
disapprove two elements of South Carolina's PSD and NNSR rules that
relate to provisions that were vacated from the federal program by the
United States Court of Appeals for the District of Columbia Circuit
(D.C. Circuit Court) on June 24, 2005. The two elements vacated from
the federal rules pertain to pollution control projects (PCPs) and
clean units. These elements exist in the South Carolina rules in both
the PSD and NNSR programs, and all references to PCPs and clean units
in both programs are being proposed for disapproval. As part of the
conditional approval of South Carolina's NNSR program, South Carolina
must commit to revise its rules to include
[[Page 52032]]
requirements for calculating emissions reductions that will be used for
offsets and ensure those reductions are surplus to other federal
requirements. In the interim, until the State NNSR program changes are
in effect, as part of the conditional approval, the State must commit
to utilize the provisions of 40 Code of Federal Regulations (CFR) part
51, Appendix S to supplement its NNSR program until it is both State-
effective and approved by EPA into the South Carolina SIP.
Changes to the federal new source review (NSR) regulations were
promulgated by EPA on December 31, 2002, and reconsidered with minor
changes on November 7, 2003, (collectively, these two final actions are
called the ``2002 NSR Reform Rules''). EPA's 2002 NSR Reform Rules, now
proposed for inclusion in the South Carolina SIP, contain provisions
for baseline emissions calculations, an actual-to-projected-actual
methodology for calculating emissions changes, options for plantwide
applicability limits (PALs), and recordkeeping and reporting
requirements.
DATES: Comments must be received on or before October 12, 2007.
ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R04-
OAR-2005-SC-0004, by one of the following methods:
1. www.regulations.gov: Follow the on-line instructions for
submitting comments.
2. E-mail: [email protected].
3. Fax: 404-562-9019.
4. Mail: (Docket ID No. EPA-R04-OAR-2005-SC-0004), Air Planning
Branch, Air, Pesticides and Toxics Management Division, U.S.
Environmental Protection Agency, Region 4, 61 Forsyth Street, SW,
Atlanta, Georgia 30303-8960.
5. Hand Delivery: Deliver your comments to: Ms. Kelly Fortin, Air
Planning Branch, Air, Pesticides and Toxics Management Division, U.S.
Environmental Protection Agency Region 4, 61 Forsyth Street, SW.,
Atlanta, Georgia 30303-8960. Such deliveries are only accepted during
the Regional Office's normal hours of operation. The Regional Office's
official hours of business are Monday through Friday, 8:30 to 4:30,
excluding federal holidays.
Instructions: Direct your comments to Docket ID No. EPA-R04-OAR-
2005-SC-0004. EPA's policy is that all comments received will be
included in the public docket without change and may be made available
online at www.regulations.gov, including any personal information
provided, unless the comment includes information claimed to be
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute. Do not submit information that you
consider to be CBI or otherwise protected through www.regulations.gov
or e-mail. 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 e-mail comment directly to EPA without going through
www.regulations.gov, your e-mail 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. For additional information about EPA's public docket, visit
the EPA Docket Center homepage at http://www.epa.gov.epahome/dockets.htm.
Docket: All documents in the docket are listed in the
www.regulations.gov index. Although listed in the index, some
information is not publicly available, e.g., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, will be publicly available only in hard copy.
Publicly available docket materials are available either electronically
at www.regulations.gov or in hard copy at the Regulatory Development
Section, Air Planning Branch, Air, Pesticides and Toxics Management
Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth
Street, SW., Atlanta, Georgia 30303-8960. EPA requests that if at all
possible, you contact the person listed in the FOR FURTHER INFORMATION
CONTACT section to schedule your inspection. The Regional Office's
official business hours are Monday through Friday, 8:30 to 4:30,
excluding federal holidays.
FOR FURTHER INFORMATION CONTACT: For information regarding the South
Carolina State Implementation Plan, contact Ms. Nacosta Ward,
Regulatory Development Section, Air Planning Branch, Air, Pesticides
and Toxics Management Division, U.S. Environmental Protection Agency
Region 4, 61 Forsyth Street SW., Atlanta, Georgia 30303-8960. Telephone
number: (404) 562-9140; e-mail address: [email protected]. For
information regarding New Source Review, contact Ms. Kelly Fortin, Air
Permits Section, at the same address above. Telephone number: (404)
562-9117; e-mail address: [email protected].
SUPPLEMENTARY INFORMATION: Throughout this document, references to
``EPA,'' ``we,'' ``us,'' or ``our,'' are intended to mean the U.S.
Environmental Protection Agency. The supplementary information is
arranged as follows:
I. What Action Is EPA Proposing?
II. Why Is EPA Proposing this Action?
III. What Is EPA's Analysis of South Carolina's NSR Rule Revisions?
A. Definitions and General Standards; South Carolina Regulation
61-62.1
B. Prevention of Significant Deterioration; South Carolina
Regulation 61-62.5, Standard No. 7
C. Nonattainment New Source Review; South Carolina Regulation
61-62.5, StandarI No. 7.1
IV. What Action Is EPA Proposing to Take?
V. Statutory and Executive Order Reviews
I. What Action Is EPA Proposing?
On July 1, 2005, the State of South Carolina, through the South
Carolina Department of Health and Environmental Control (DHEC),
submitted revisions to the South Carolina SIP. The SIP submittal
consists of changes to the South Carolina Air Pollution Control
Regulations and Standards (South Carolina Regulations). Specifically,
the proposed SIP revisions include changes to South Carolina Regulation
61-62.1 entitled ``Definitions and General Standards;'' Regulation 61-
62.5, Standard No. 7 entitled ``Prevention of Significant
Deterioration;'' and Regulation 61-62.5, Standard No. 7.1 entitled
``Nonattainment New Source Review.'' DHEC submitted this SIP revision
in response to EPA's December 31, 2002, changes to the Federal NSR
program. EPA is proposing to partially approve and disapprove certain
portions of the July 1, 2005, SIP submittal, consistent with section
110(k)(3) of the CAA. EPA is also proposing to conditionally approve
provisions of the July 1, 2005, SIP submittal consistent with section
110(k)(4) of the CAA. As part of the conditional approval, South
Carolina will have twelve months from the date of EPA's final
conditional approval of the SIP revisions in which to further revise
its NNSR rules, as described herein, to be consistent with existing
Federal law.
[[Page 52033]]
Consistent with section 110(k)(3) of the CAA, EPA may partially
approve and disapprove portions of a SIP revision that meet all the
applicable requirements and are severable from the remainder of the
revision that is being disapproved or conditionally approved. Pursuant
to section 110(k)(3), EPA is proposing to (1) approve one provision of
South Carolina's minor source permitting program (discussed more fully
below); (2) partially approve South Carolina's PSD program; and (3)
disapprove all references to PCPs and clean units in South Carolina's
PSD and NNSR programs. The PCP and clean unit references are all
severable from the other provisions of South Carolina's PSD and NNSR
programs. EPA is not approving any portion of South Carolina's rules
regarding PCPs and clean units. Further, any use by South Carolina of
its State rules on PCPs and clean units is, according to a Federal
appeals court, contrary to the CAA.
Pursuant to section 110(k)(4) of the CAA, EPA may conditionally
approve a portion of a SIP revision based on a commitment from the
State to adopt specific, enforceable measures no later than twelve
months from the approval date of final conditional approval. If the
State fails to commit to undertake the necessary changes, or fails to
actually make the changes within the twelve month period, EPA will
issue a finding of disapproval. EPA is not required to propose the
finding of disapproval.
The necessary revisions to the South Carolina SIP will materially
alter the existing SIP-approved rule. As a result, the State must also
make a new SIP submittal to EPA for approval that includes the rule
changes within twelve months from the date of EPA's final action
conditionally approving South Carolina's NNSR program. As with any SIP
revision, South Carolina must undergo public notice and comment, and
allow for a public hearing (and any other procedures required by State
law), on the proposed changes to its rules. If South Carolina fails to
adopt and submit the specified measures by the end of one year (from
the final conditional approval), or fails to make a SIP submittal to
EPA within twelve months following the final conditional approval, EPA
will issue a finding of disapproval. If South Carolina timely revises
its rules and submits the revised SIP submittal, EPA will process that
SIP revision consistent with the CAA.
More specifically, with regard to the conditional approval of the
NNSR program, South Carolina must revise its rules to include a
methodology for calculating emissions reductions to be used as offsets
that includes a baseline for determining credit for emissions offsets
that, at a minimum, meets the requirements set out in 40 CFR
51.165(a)(3)(i) and Appendix S section IV.C. The emission offsets
provisions must also specify that the reductions must be surplus and
cannot be used for offsets if they are otherwise required by the South
Carolina SIP or other Federal standards, such as the New Source
Performance Standards (NSPS) and National Emissions Standards for
Hazardous Air Pollutants (NESHAP), including the Maximum Achievable
Control Technology (MACT) standards. As part of the conditional
approval, South Carolina must commit to make these changes within the
twelve month timeframe. Further, in the interim, until the required
State NNSR program changes are in effect, South Carolina must commit to
utilize the requirements of the Federal NNSR program outlined in 40 CFR
part 51, Appendix S.
II. Why Is EPA Proposing This Action?
On December 31, 2002 (67 FR 80186), EPA published final rule
changes to title 40 CFR parts 51 and 52, regarding the CAA's PSD and
NNSR programs. On November 7, 2003 (68 FR 63021), EPA published a
notice of final action on the reconsideration of the December 31, 2002,
final rule changes. In that November 7, 2003, final action, EPA added
the definition of ``replacement unit,'' and clarified an issue
regarding PALs. The December 31, 2002, and the November 7, 2003, final
actions are collectively referred to as the ``2002 NSR Reform Rules.''
The purpose of this action is to propose to partially approve,
disapprove and conditionally approve certain portions of the SIP
submittal from the State of South Carolina, which includes the
provisions of EPA's 2002 NSR Reform Rules.
The 2002 NSR Reform Rules are part of EPA's implementation of Parts
C and D of title I of the CAA, 42 U.S.C. 7470-7515. Part C of title I
of the CAA, 42 U.S.C. 7470-7492, is the PSD program, which applies in
areas that meet the National Ambient Air Quality Standards (NAAQS)--
``attainment'' areas--as well as in areas for which there is
insufficient information to determine whether the area meets the
NAAQS--``unclassifiable'' areas. Part D of title I of the CAA, 42
U.S.C. 7501-7515, is the NNSR program, which applies in areas that are
not in attainment of the NAAQS--``nonattainment'' areas. Collectively,
the PSD and NNSR programs are referred to as the ``New Source Review''
or NSR programs. EPA regulations implementing these programs are
contained in 40 CFR 51.165, 51.166, 52.21, 52.24, and part 51, Appendix
S.
The CAA's NSR programs are preconstruction review and permitting
programs applicable to new and modified stationary sources of air
pollutants regulated under the CAA. The NSR programs of the CAA include
a combination of air quality planning and air pollution control
technology program requirements. Briefly, section 109 of the CAA, 42
U.S.C. 7409, requires EPA to promulgate primary NAAQS to protect public
health and secondary NAAQS to protect public welfare. Once EPA sets
those standards, states must develop, adopt, and submit to EPA for
approval, a SIP that contains emissions limitations and other control
measures to attain and maintain the NAAQS. Each SIP is required to
contain a preconstruction review program for the construction and
modification of any stationary source of air pollution to assure that
the NAAQS are achieved and maintained; to protect areas of clean air;
to protect air quality related values (such as visibility) in national
parks and other areas; to assure that appropriate emissions controls
are applied; to maximize opportunities for economic development
consistent with the preservation of clean air resources; and to ensure
that any decision to increase air pollution is made only after full
public consideration of the consequences of the decision.
The 2002 NSR Reform Rules made changes to five areas of the NSR
programs. In summary, the 2002 Rules: (1) Provided a new method for
determining baseline actual emissions; (2) adopted an actual-to-
projected-actual methodology for determining whether a major
modification has occurred; (3) allowed major stationary sources to
comply with PALs to avoid having a significant emissions increase that
triggers the requirements of the major NSR program; (4) provided a new
applicability provision for emissions units that are designated clean
units; and (5) excluded PCPs from the definition of ``physical change
or change in the method of operation.'' On November 7, 2003 (68 FR
63021), EPA published a notice of final action on its reconsideration
of the 2002 NSR Reform Rules, which added a definition for
``replacement unit'' and clarified an issue regarding PALs. For
additional information on the 2002 NSR Reform Rules, see, 67 FR 80186
(December 31, 2002), and http://www.epa.gov/nsr.
After the 2002 NSR Reform Rules were finalized and effective (March
3, 2003), industry, state, and environmental petitioners challenged
numerous aspects of the 2002 NSR
[[Page 52034]]
Reform Rules, along with portions of EPA's 1980 NSR Rules (45 FR 52676,
August 7, 1980). On June 24, 2005, the D.C. Circuit Court issued a
decision on the challenges to the 2002 NSR Reform Rules. New York v.
United States, 413 F.3d 3 (D.C. Cir. 2005). In summary, the D.C.
Circuit Court vacated portions of the rules pertaining to clean units
and PCPs, remanded a portion of the rules regarding recordkeeping, 40
CFR 52.21(r)(6) and 40 CFR 51.166(r)(6), and either upheld or did not
comment on the other provisions included as part of the 2002 NSR Reform
Rules. On June 13, 2007 (72 FR 32526), EPA took final action to revise
the 2002 NSR Reform Rules to remove from the CFR all provisions
pertaining to clean units and the PCP exemption that were vacated by
the D.C. Circuit Court. These proposed actions are consistent with the
D.C. Circuit Court's decision because the vacated portions of the
Federal rules will not be approved as part of the South Carolina SIP.
Further, EPA notes that use of any PCP and clean unit rules has been
deemed contrary to the CAA by a Federal appeals court.
With regard to the remanded portions of the 2002 NSR Reform Rules
related to recordkeeping, on March 8, 2007 (45 FR 10445), EPA responded
to the D.C. Circuit Court's remand by proposing two alternative options
to clarify what constitutes ``reasonable possibility'' and when the
``reasonable possibility'' recordkeeping requirements apply. The
``reasonable possibility'' provision identifies for sources and
reviewing authorities the circumstances under which a major stationary
source undergoing a modification that does not trigger major NSR must
keep records. South Carolina's SIP revisions are approvable at this
time because the South Carolina rules are at least as stringent as the
current Federal rules (see, e.g., South Carolina Regulation 61-62.5,
Standard No. 7). If EPA adopts recordkeeping criteria that are more
stringent than the current South Carolina rules on recordkeeping, the
State's rules may need to be revised to be at least as stringent as the
Federal requirements.
The 2002 NSR Reform Rules require that state agencies adopt and
submit revisions to their SIP permitting programs implementing the
minimum program elements of the 2002 NSR Reform Rules no later than
January 2, 2006. (Consistent with changes to 40 CFR 51.166(a)(6)(i),
state agencies are now required to adopt and submit SIP revisions
within three years after new amendments are published in the Federal
Register.) State agencies may meet the requirements of 40 CFR part 51
and the 2002 NSR Reform Rules with different but equivalent
regulations. However, if a state decides not to implement any of the
new applicability provisions, that state is required to, among other
things, demonstrate that its existing program is at least as stringent
as the federal program.
On July 1, 2005, DHEC submitted a SIP revision for the purpose of
revising the State's NSR permitting provisions. These changes were made
primarily to adopt EPA's 2002 NSR Reform Rules. As discussed in further
detail below, EPA believes the revisions contained in the South
Carolina submittal are approvable for inclusion into the South Carolina
SIP so long as the specific changes described below are made within
twelve months of the date of EPA's final conditional approval. As a
result, EPA is proposing to partially approve and disapprove, and
conditionally approve the South Carolina SIP revisions, consistent with
sections 110(k)(3) and 110(k)(4) of the CAA. As part of the conditional
approval South Carolina must commit to utilize the provisions of 40 CFR
part 51, Appendix S, for its NNSR program until the specified changes
to that program are in effect and approved into the SIP by EPA.
III. What Is EPA's Analysis of South Carolina's NSR Rule Revisions?
South Carolina currently has a SIP-approved NSR program for new and
modified stationary sources. Today, EPA is proposing to partially
approve, disapprove, and conditionally approve revisions to South
Carolina's existing NSR program. South Carolina's proposed revisions
became State-effective on June 24, 2005, and were submitted to EPA on
July 1, 2005. Copies of the revised rules, as well as the State's
Technical Support Document, can be obtained from the Docket, as
discussed in the ADDRESSES section above. A discussion of the specific
changes to South Carolina's rules comprising the SIP revision, as well
as the additional changes to be made by South Carolina to its rules as
part of the conditional approval, follows.
A. Definitions and General Standards; South Carolina Regulation 61-62.1
EPA is proposing to approve Section II of South Carolina Regulation
61-62.1 regarding general permit requirements. South Carolina revised
Section II, paragraph H.1, of its regulations to allow for synthetic
minor permits in nonattainment areas. On April 30, 2004 (69 FR 23858),
one area in South Carolina was designated nonattainment for the 8-hour
ozone NAAQS, which prompted the changes to Section II. The proposed SIP
revision recognizes that South Carolina now has a nonattainment area
and Section II includes the appropriate requirements for synthetic
minor source permits in nonattainment areas. Since the only South
Carolina area previously designated as nonattainment prior to the April
2004 designation was redesignated to attainment prior to the due date
for NNSR rules, South Carolina's rules only allowed for a major source
or major modification, as defined by Regulation 61-62.5, Standard No. 7
(PSD), to request federally enforceable permit conditions to limit a
source's potential to emit and become a synthetic minor source. EPA is
proposing to approve South Carolinas's revisions to Regulation 61-62.1
to allow synthetic minor sources to obtain preconstruction permits in
nonattainment as well as attainment areas. This portion of South
Carolina's NSR program is severable from the NNSR rules subject to the
proposed conditional approval and will not be affected by EPA's
proposed disapproval. If South Carolina does not submit the required
changes to its NNSR program within the specified time period, and EPA
takes action to disapprove the conditionally approved portions of the
NNSR program, Regulation 61-62.1 will not be affected because it is
being proposed for approval today.
B. Prevention of Significant Deterioration; South Carolina Regulation
61-62.5, Standard No. 7
South Carolina Regulation 61.62.5, Standard No. 7, contains the
preconstruction review program that provides for the prevention of
significant deterioration of ambient air quality as required under Part
C of title I of the CAA (the PSD program). The PSD program applies to
sources that are major stationary sources or undergoing major
modifications in areas that are designated as attainment or
unclassifiable with regard to any NAAQS. South Carolina's PSD program
was originally approved into the SIP by EPA on February 10, 1982, and
has been revised several times since then in order to remain consistent
with federal rule changes. The current changes to Standard No. 7, which
EPA is now proposing to partially disapprove and partially approve into
the South Carolina SIP, were submitted to update the existing South
Carolina Regulation to be consistent with the current federal PSD
rules, including the 2002 NSR Reform Rules. The SIP revision addresses
baseline actual emissions, actual-to-projected actual applicability
[[Page 52035]]
tests, and PALs. South Carolina's SIP revision also includes two
portions of EPA's 2002 NSR Reform Rules that were vacated by the D.C.
Circuit Court--PCPs and clean units. As a result, EPA is proposing to
partially approve the PSD portion of the South Carolina SIP revision
with the exception of references to PCPs and clean units which EPA is
proposing to disapprove (similar references also exist in South
Carolina's NNSR program). The PCP and clean unit references are
severable from the PSD and NNSR programs. EPA is disapproving all rules
and/or rule sections in the South Carolina PSD rules (and NNSR rules,
discussed later in this notice) referencing clean units or PCPs.
Specifically, the following South Carolina rules are being proposed for
disapproval.
Table 1.--PSD PCP and Clean Unit References
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Corresponding vacated
South Carolina regulation 61-62.5, federal provision 40 Subject
standard 7 CFR 52.21
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(a)(2)(iv)(e)..................... (a)(2)(iv)(e)........ Clean unit applicability.
(a)(2)(iv)(f)--Second sentence.... (a)(2)(iv)(f)--Second Entire second sentence (``For example * * *'') Reference to clean unit.
sentence.
(a)(2)(vi)........................ (a)(2)(vi)........... PCP provision.
(b)(12)........................... (b)(42).............. Clean unit definition.
(b)(30)(iii)(h)................... (b)(2)(iii)(h)....... PCP provision.
(b)(34)(iii)(b)................... (b)(3)(iii)(b)....... Clean unit provision.
(b)(34)(vi)(d).................... (b)(3)(vi)(d)........ Clean unit and PCP provisions.
(b)(35)........................... (b)(32).............. PCP definition.
(r)(6) \1\........................ (r)(6)............... Reference to clean unit.
(r)(7) \1\........................ NA................... Reference to clean unit.
(x)............................... (x).................. Clean unit provision.
(y)............................... (y).................. Clean unit provision.
(z)............................... (z).................. PCP provision.
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\1\ Only the reference to the term ``clean unit'' is being proposed for disapproval. The remainder of this regulatory provision is being proposed for
approval.
In addition to EPA's proposal to disapprove the South Carolina PSD
and NNSR rules regarding PCPs and clean units, EPA notes that any use
of such rules has been deemed contrary to the CAA by a Federal appeals
court.
As part of its evaluation of the South Carolina SIP submittal, EPA
performed a line-by-line comparison of the proposed revisions to the
federal requirements. During this review it was noted that a
typographical error exists in paragraph (b)(41)(ii)(d) of Standard No.
7, South Carolina Regulation 61-62.5, where there is a reference to
paragraph (a)(41)(ii)(a). This reference should be to paragraph
(b)(41)(ii)(a). Although this is a minor issue that does not affect the
approvability of this portion of the SIP revision, South Carolina
should correct this error the next time this rule is revised.
As a general matter, state agencies may meet the requirements of 40
CFR part 51, and the 2002 NSR Reform Rules, with different but
equivalent regulations. However, if a state decides not to implement
any of the new applicability provisions, that state is required to
demonstrate that its existing program is at least as stringent as the
federal program. As part of its SIP submittal, South Carolina (through
DHEC) provided EPA with an ``equivalency demonstration'' regarding two
differences from the federal rules.
One difference relates to the removal of the word ``malfunction''
from the definitions of ``baseline actual emissions'' at paragraph
(b)(4)(i)(a) and ``projected actual emissions'' at paragraph
(b)(41)(ii)(b) in Standard No. 7, South Carolina Regulation 61-62.5. In
justifying the change, DHEC notes the difficulty of predicting
malfunction emissions as part of the projected actual emissions. In
addition, DHEC is concerned about the possibility that including
malfunction emissions may result in the unintended rewarding of the
source's poor operation and maintenance by allowing malfunction
emissions to be included in baseline emissions that will be used to
calculate emissions changes and emissions credits.
A second difference involves the inclusion of language in the
definition of baseline actual emissions at paragraph (b)(4)(ii) in
Standard No. 7, South Carolina Regulation 61-62.5, which provides DHEC
with the authority to determine if the 24-month look-back period
selected by the source is appropriate. In its equivalency
determination, DHEC states that it is simply asserting its authority to
review the source's calculations, if necessary, to ensure that the time
period selected is appropriate. EPA agrees that DHEC may explicitly
retain such authority, consistent with EPA's 2002 NSR Reform Rules. EPA
concurs with the State that neither this change, nor the difference
regarding ``malfunctions,'' lessens the stringency of South Carolina's
NSR program. Therefore, South Carolina's PSD program may be partially
approved, with the exception of the PCP and clean unit references,
which are subject to disapproval. Notably, EPA has not yet taken final
action in response to the D.C. Circuit Court's remand of the
recordkeeping provisions of EPA's 2002 NSR Reform Rules. South
Carolina's rule contains recordkeeping requirements that are at least
as stringent as the federal rule. While final action by EPA with regard
to the remand may require South Carolina to take action to revise their
rules, at this time, the South Carolina rules are consistent with
federal requirements.
After conducting the line-by-line evaluation and reviewing the
equivalency determinations for certain portions of South Carolina
Regulation 61-62.5, Standard No. 7, EPA has determined that the
proposed SIP revisions are consistent with the federal program
requirements for the preparation, adoption and submittal of
implementation plans for the Prevention of Significant Deterioration of
Air Quality, set forth at 40 CFR 51.166, with the exception of the PCP
and clean unit provisions. Therefore, EPA is now proposing to partially
approve and disapprove, pursuant to section 110(k)(3), the PSD portion
of the July 1, 2005, SIP revision.
C. Nonattainment New Source Review; South Carolina Regulation 61-62.5,
Standard No. 7.1
South Carolina's NNSR program, which provides permitting
requirements for major sources in or impacting upon nonattainment
areas, is set forth at Regulation 61-62.5, Standard No. 7.1.
[[Page 52036]]
Effective June 15, 2004, one area in South Carolina was designated
nonattainment for the 8-hour ozone NAAQS. Since the only area in South
Carolina previously designated as nonattainment was redesignated to
attainment prior to the due date for the NNSR rules, South Carolina's
rules did not contain any provisions for the permitting of sources in
nonattainment areas.
South Carolina's NNSR program applies to the construction and
modification of any major stationary source of air pollution in a
nonattainment area, as required by Part D of title I of the CAA. To
receive approval to construct, a source that is subject to South
Carolina Regulation 61-62.5, Standard No. 7.1 must show that it will
not cause a net increase in pollution, will not create a delay in the
area attaining the NAAQS, and will install and use control technology
that achieves the lowest achievable emissions rate. The provisions in
the South Carolina rules were established to meet the current federal
nonattainment rule, including the 2002 NSR Reform Rules, which are
found at 40 CFR 51.160-51.165, and part 51, Appendix S.
As part of its evaluation of the South Carolina submittal, EPA
performed a line-by-line review of the proposed revisions, as well as
reviewing the equivalency determinations. EPA has determined that South
Carolina's NNSR program is not entirely consistent with the program
requirements for the preparation, adoption and submittal of
implementation plans for NSR, set forth at 40 CFR 51.160-51.165, and
that revisions are necessary for full approval. The required changes
relate to requirements for emission reductions that facilities will use
to ``offset'' proposed emissions increases. Consistent with section
110(k)(4), EPA may conditionally approve South Carolina's SIP revision
based on the State's commitment to adopt specific, enforceable measures
by a date certain, not to exceed one year after the date of the
conditional approval.
The CAA prohibits the use of emission reductions ``otherwise
required'' by CAA requirements as creditable emission reductions for
the purpose of NSR offsets. See CAA section 173(c)(2). In addition, the
federal regulations require that emission reductions used for offsets
must be ``surplus.'' See 40 CFR 51.165(a)(3)(ii)(C)(1)(i). The
corresponding State language at 7.1(d)(1)(C)(iii)(a) indicates that
reductions may be generally credited if they are permanent,
quantifiable, and federally enforceable, but does not specifically
address the ``surplus'' provision of the federal rules. The State
regulation also indicates that reductions can be claimed for use as
offsets to the extent the DHEC has not relied upon them for the
issuance of permits under regulations approved pursuant to 40 CFR part
51, subpart I or in demonstrating attainment or reasonable further
progress. See Standard 7.1(d)(viii). EPA believes this provision could
be interpreted to allow the use of emissions reductions that have been
required by NESHAP or NSPS requirements or may have been required by
other SIP provisions not used towards reasonable further progress or in
the demonstration of attainment. Hence, it is EPA's determination that
the State rule does not explicitly meet the CAA and federal
requirements set out at 40 CFR 51.165.
The State nonattainment regulations also do not specifically
address how the emission reductions used for offsets will be
calculated. The federal regulations require each plan to provide that
the ``offset baseline'' shall be the actual emissions of the source
from which offset credit is obtained. See 40 CFR 51.165(a)(3)(i). The
Emissions Offset Interpretive Ruling, 40 CFR part 51, Appendix S, sets
forth the conditions upon which a major source or modification would be
allowed to construct in a nonattainment area and includes provisions
for establishing the baseline for calculating emissions offsets. See 40
CFR part 51, Appendix S section IV.C. At a minimum, the State rule
should contain the baseline provisions for calculating offsets that
meet the requirements of Appendix S. EPA is proposing to conditionally
approve the South Carolina SIP revision including the NNSR program and
provide South Carolina with twelve months after EPA's final conditional
approval in which to effectuate the changes necessary for EPA to
approve South Carolina's NNSR program.
As discussed earlier, EPA is proposing to disapprove two provisions
of South Carolina's NNSR program that relate to provisions that were
vacated from the federal program by the D.C. Circuit Court. The two
provisions vacated from the federal rules pertain to PCPs and clean
units. The PCP and clean unit references are severable from the
remainder of the NNSR program. Specifically, the following South
Carolina rules are being proposed for disapproval.
Table 2.--NNSR PCP and Clean Unit References
--------------------------------------------------------------------------------------------------------------------------------------------------------
Corresponding vacated
South Carolina regulation 61-62.5, federal provision 40 Subject
standard 7.1 CFR 51.165
--------------------------------------------------------------------------------------------------------------------------------------------------------
(b)(5)............................ (a)(2)(ii)(E)........ Clean unit applicability.
(b)(6)--Second Sentence........... (a)(2)(ii)(F)--Second Entire second sentence (``For example * * *'') Reference to clean unit.
sentence.
(b)(8)............................ (a)(2)(iv).......... PCP provision.
(c)(4)............................ (a)(1)(xxix)......... Clean unit definition.
(c)(6)(C)(viii)................... (a)(1)(v)(C)(8)...... PCP provision.
(c)(8)(C)(iii).................... (a)(1)(vi)(C)(3)..... Clean unit provision.
(c)(8)(E)(v)...................... (a)(1)(vi)(E)(5)..... Clean unit and PCP provisions.
(c)(10)........................... (a)(1)(xxv).......... PCP definition.
(d)(1)(C)(ix)..................... (a)(3)(ii)(H)........ Clean unit and PCP provisions.
(d)(1)(C)(x)...................... (a)(3)(ii)(I)........ Clean unit and PCP provisions.
(d)(3) \1\........................ (a)(6)............... Reference to clean unit.
(d)(4) \1\........................ NA................... Reference to clean unit.
(f)............................... (c).................. Clean unit provision.
(g)............................... (d).................. Clean unit provision.
(h)............................... (e).................. PCP provision.
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Only the reference to the term ``clean unit'' is being proposed for disapproval. The remainder of this regulatory provision is being proposed for
approval.
[[Page 52037]]
In addition to EPA's proposal to disapprove the South Carolina PSD
and NNSR rules referencing PCPs and clean units, EPA notes that any use
of such rules has been deemed contrary to the CAA by a Federal appeals
court.
As discussed above, South Carolina provided EPA with an equivalency
demonstration to show that its program is at least as stringent as the
federal program. The two differences from the federal rule for which
the State is proposing equivalency are the same as those identified in
the State's PSD program. These deviations from the federal rule are
acceptable, and may be retained in South Carolina's final NNSR program
proposed as part of this conditional approval.
The first difference regards the removal of the word
``malfunction'' from the definitions of ``baseline actual emissions''
at paragraph (c)(2)(B)(ii) and ``projected actual emissions'' at
paragraph (c)(11)(B)(ii) in Regulation 61-62.5, Standard No. 7.1. In
justifying the difference, DHEC notes the difficulty of predicting
malfunction emissions as part of the projected actual emissions. In
addition DHEC is concerned about the possibility that including
malfunction emissions may result in the unintended rewarding of the
source's poor operation and maintenance by allowing malfunction
emissions to be included in baseline emissions that will be used to
calculate emissions changes and emissions credits.
The second difference involves the inclusion of language in the
definition of baseline actual emissions at paragraph (c)(2)(B) in
Regulation 61-62.5, Standard No. 7.1, to indicate that DHEC reserves
the right to determine if the 24-month look-back period selected by the
source is appropriate. In its equivalency determination, DHEC states
that it is simply asserting its authority to review the source's
calculations, if necessary, to ensure that the time period selected is
appropriate. EPA agrees that DHEC may explicitly retain such authority,
consistent with EPA's 2002 NSR Reform Rules. EPA believes neither of
these differences lessens the stringency of South Carolina's NNSR
program.
In summary, EPA is proposing to disapprove two elements of South
Carolina's new NNSR rules that pertain to PCPs and clean units and
which were vacated from the federal program by the D.C. Circuit Court.
These two elements include various rules which are listed in Table 2,
above. In addition, EPA is proposing to conditionally approve the
remainder of South Carolinas's new NNSR program into the SIP. As part
of the conditional approval mechanism, within twelve months of EPA's
final action on the conditional approval, the State must: (1) Revise
the NNSR program to include a provision that emission reductions are
surplus and are not to be used as offsets if they are otherwise
required by the SIP, NSPS, NESHAP, including MACT, standards or other
federal requirements; (2) revise its rule to include a methodology for
the calculation of emissions reductions that includes a baseline for
determining credit for emissions offsets that, at a minimum, meet the
requirements set out in 40 CFR part 51, Appendix S section IV.C.; and
(3) implement the provisions found in 40 CFR part 51, Appendix S until
its revised NNSR program is in effect and approved into the SIP by EPA.
If South Carolina fails to comply with the substantive requirements in
the specified period of time, EPA will issue a finding of disapproval.
IV. What Action Is EPA Proposing To Take?
EPA is proposing to partially approve, disapprove, and
conditionally approve revisions to the South Carolina SIP (Regulation
61-62.1, Regulation 61-62.5 Standard No. 7, and Regulation 61-62.5
Standard No. 7.1) submitted by DHEC on July 1, 2005, which include
changes to South Carolina's PSD and NNSR programs. As part of the
partial approval, EPA is approving the entirety of South Carolina's PSD
program with the exception of any references to PCPs and clean units,
which are proposed for disapproval (see Table 1). EPA is also approving
Regulation 61-61.2 regarding synthetic minor sources that is part of
the minor source permitting program. As part of the disapproval, EPA is
disapproving all rules referencing clean units and PCPs in South
Carolina's NNSR program (see Table 2). As part of the conditional
approval, South Carolina must (1) revise the NNSR program to include a
provision that emission reductions must be surplus and are not to be
used as offsets if they are otherwise required by the SIP, NSPS,
NESHAP, including MACT, standards or other federal requirements and
submit to EPA a SIP revision within twelve months with the revised
rule; (2) revise its NNSR program to include a methodology for
calculating offsets, and submit to EPA a SIP revision within twelve
months with the revised rule; and (3) utilize the provisions of 40 CFR
part 51, Appendix S to supplement its NNSR program until South
Carolina's NNSR program is approved by EPA. Consistent with section
110(k), EPA is now proposing to partially approve, disapprove and
conditionally approve the July 1, 2005, SIP revision from South
Carolina.
V. Statutory and Executive Order Reviews
Under Executive Order 12866 (58 FR 51735, October 4, 1993), this
proposed action is not a ``significant regulatory action'' and
therefore is not subject to review by the Office of Management and
Budget. For this reason, this action is also not subject to Executive
Order 13211, ``Actions Concerning Regulations That Significantly Affect
Energy Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001). This
proposed action merely proposes to approve state law as meeting federal
requirements and imposes no additional requirements beyond those
imposed by state law. Accordingly, the Administrator certifies that
this proposed rule will not have a significant economic impact on a
substantial number of small entities under the Regulatory Flexibility
Act (5 U.S.C. 601 et seq.). Because this rule proposes to approve pre-
existing requirements under state law and does not impose any
additional enforceable duty beyond that required by state law, it does
not contain any unfunded mandate or significantly or uniquely affect
small governments, as described in the Unfunded Mandates Reform Act of
1995 (Pub. L. 104-4).
This proposed rule also does not have tribal implications because
it will not have a substantial direct effect on one or more Indian
tribes, on the relationship between the Federal Government and Indian
tribes, or on the distribution of power and responsibilities between
the Federal Government and Indian tribes, as specified by Executive
Order 13175 (65 FR 67249, November 9, 2000). This action also does not
have Federalism implications because it does not have substantial
direct effects on the states, on the relationship between the national
government and the states, or on the distribution of power and
responsibilities among the various levels of government, as specified
in Executive Order 13132 (64 FR 43255, August 10, 1999). This proposed
action merely proposes to approve state law as meeting federal
requirements and imposes no additional requirements beyond those
imposed by state law. As a result, it does not alter the relationship
or the distribution of power and responsibilities established in the
Clean Air Act. This proposed rule also is not subject to Executive
Order 13045 ``Protection of Children from Environmental Health Risks
and Safety Risks'' (62 FR 19885, April 23, 1997), because it is not
economically significant.
[[Page 52038]]
In reviewing SIP submissions, EPA's role is to approve state
choices, provided that they meet the criteria of the Clean Air Act. In
this context, in the absence of a prior existing requirement for the
State to use voluntary consensus standards (VCS), EPA has no authority
to disapprove a SIP submission for failure to use VCS. It would thus be
inconsistent with applicable law for EPA, when it reviews a SIP
submission, to use VCS in place of a SIP submission that otherwise
satisfies the provisions of the Clean Air Act. Thus, the requirements
of section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (15 U.S.C. 272 note) do not apply. This proposed rule does
not impose an information collection burden under the provisions of the
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).
List of Subjects in 40 CFR Part 52
Environmental protection, Air pollution control, Carbon monoxide,
Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate
matter, Reporting and recordkeeping requirements, Sulfur oxides,
Volatile organic compounds.
Authority: 42 U.S.C. 7401 et seq.
Dated: September 5, 2007.
J.I. Palmer, Jr.,
Regional Administrator, Region 4.
[FR Doc. E7-17979 Filed 9-11-07; 8:45 am]
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