[Federal Register Volume 73, Number 125 (Friday, June 27, 2008)]
[Proposed Rules]
[Pages 36477-36481]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-14625]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52
[EPA-R03-OAR-2007-0522; FRL-8686-1]
Approval and Promulgation of Air Quality Implementation Plans;
Virginia; Virginia Major New Source Review for Nonattainment Areas
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed rule
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SUMMARY: EPA is proposing limited approval of a State Implementation
Plan (SIP) revision submitted by the Commonwealth of Virginia. This
revision pertains to amendments to Virginia's existing new source
review permit program for owners of sources located or locating in
Nonattainment areas which were submitted to EPA on February 12, 2007.
EPA is proposing limited approval of these changes to the nonattainment
new source review program, because while the SIP revision submitted by
the Commonwealth strengthens the SIP, it does not fully meet the
current Federal requirements for the allowable lookback period under
the definition of ``baseline actual emissions''. EPA is also proposing
full approval of a related SIP revision submitted by the Commonwealth
on December 16, 2003, pertaining to amendments made to Virginia's
existing nonattainment new source review permit program at that time.
This action is being taken under the Clean Air Act (CAA or the Act). In
a separate action, EPA has addressed changes made by Virginia to its
prevention of significant deterioration (PSD) new source review rules
which were previously submitted on October 10, 2006.
DATES: Written comments must be received on or before July 28, 2008.
ADDRESSES: Submit your comments, identified by Docket ID Number EPA-
R03-OAR-2007-0522 by one of the following methods:
A. www.regulations.gov. Follow the on-line instructions for
submitting comments.
B. E-mail: [email protected].
C. Mail: EPA-R03-OAR-2007-0522, David Campbell, Chief, Permits and
Technical Assessment Branch, Mailcode 3AP11, U.S. Environmental
Protection Agency, Region III, 1650 Arch Street, Philadelphia,
Pennsylvania 19103.
D. Hand Delivery: At the previously-listed EPA Region III address.
Such deliveries are only accepted during the Docket's normal hours of
operation, and special arrangements should be made for deliveries of
boxed information.
Instructions: Direct your comments to Docket ID No. EPA-R03-OAR-
2007-0522. 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.
Docket: All documents in the electronic 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, is not placed on the Internet and 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 during normal business hours at the Air Protection
Division, U.S. Environmental Protection Agency, Region III, 1650 Arch
Street, Philadelphia, Pennsylvania 19103. Copies of the State submittal
are available at the Virginia Department of Environmental Quality, 629
East Main Street, Richmond, Virginia, 23219.
FOR FURTHER INFORMATION CONTACT: Sharon McCauley, (215) 814-3376, or by
e-mail at [email protected].
SUPPLEMENTARY INFORMATION: On December 16, 2003 and February 12, 2007,
the Commonwealth of Virginia
[[Page 36478]]
submitted revisions to its SIP for approval of amendments to Virginia's
existing new source review (NSR) permit program for owners of sources
locating in nonattainment areas.
I. Background
On December 31, 2002, the U.S. EPA published revisions to the
Federal PSD and nonattainment new source review (NNSR) regulations (67
FR 80186), effective March 3, 2003. These changes to the Federal NSR
regulations were reconsidered with minor changes on November 7, 2003
(68 FR 63021) and collectively, these two final actions are called the
``2002 New Source Review (NSR) Reform Rules''.
The 2002 NSR Reform Rules made changes to five areas of the NSR
programs. In summary, the 2002 Rules: (1) Provide a new method for
determining the baseline actual emissions; (2) adopt an actual-to-
projected actual methodology for determining whether a major
modification has occurred; (3) allow major stationary sources to comply
with plant-wide applicability limits to avoid having a significant
emissions increase that triggers the requirements of the major NSR
program; (4) provide a new applicability provision for emissions units
that are designated clean units; and (5) exclude pollution control
projects (PCPs) from the definition of ``physical change or change in
the method of operation.'' The November 7, 2003 notice of final action
added a definition for ``replacement unit'' and clarified an issue
regarding the Plant-wide Applicability Limitation (PALs) baseline
calculation procedures for newly constructed units.
On June 24, 2005, the United States Court of Appeals for the
District of Columbia Circuit ruled in New York v. EPA, 413 F.3d 3 (DC
Cir. June 24, 2005) that EPA lacked the authority to promulgate the
Clean Unit provisions, and the Court requested that EPA vacate that
portion of the 2002 Federal regulation, codified at 40 CFR 52.21(x), as
contrary to the statute. Also, the Court determined that EPA lacked the
authority to create PCP exceptions from NSR and vacated those parts of
the 1991 and 2002 rules, codified at 40 CFR 52.21(b)(32) and 52.21(z),
as contrary to the statute.
As stated in the December 31, 2002 ``NSR Reform'' rulemaking, State
and local permitting agencies were required to adopt and submit
revisions to their part 51 permitting programs, implementing the
minimum program elements of that rulemaking no later than January 2,
2006 (67 FR 80240). With this submittal, Virginia requests approval of
program revisions to satisfy this requirement. In addition, Virginia
has updated their stationary source permit regulations in Chapter 50,
Article 4, to conform to the new NSR regulatory program and translated
the Federal NSR requirements into their regulatory text in Chapter 80,
Article 9 in a manner that is consistent with State regulatory
development procedures.
On February 14, 2007, EPA Region III received a revision request to
the Virginia SIP from the Virginia Department of Environmental Quality
(VADEQ). The February 14, 2007 SIP revision request consisted of
changes to Legislative Rule 9 VAC 5 Chapter 50 Article 4--Stationary
Sources, 9 VAC 5 Chapter 80 Article 6--Permits for New and Modified
Stationary Sources, and 9 VAC 5 Chapter 80 Article 9--Permits for
Construction and Major Modification of Major Stationary Sources of Air
Pollution which Cause or Contribute to Nonattainment. These rules were
adopted by the Commonwealth of Virginia State Air Pollution Control
Board on June 21, 2006 and became effective September 1, 2006. The
Commonwealth adopted the regulations in order to meet the relevant plan
requirements of 40 CFR 51.165.
II. Summary of SIP Revision
What is being addressed in this document?
Virginia currently has an EPA-approved NSR program for new and
modified sources. Today, EPA is proposing limited approval of the
Virginia pre-construction permitting program as submitted on February
12, 2007 for facilities located or locating in nonattainment areas.
This revision submittal consists of rules titled ``Chapter 50, Article
4--Stationary Sources'', and ``Chapter 80, Article 9--Permits for
Construction and Major Modification of Major Stationary Sources of Air
Pollution Which Cause or Contribute to Nonattainment'' adopted June 21,
2006 and effective September 1, 2006. Virginia also submitted changes
to 9 VAC Chapter 80 Article 6--Permits for New and Modified Stationary
Sources as part of the SIP revision, however, Article 6 has not
previously been approved as part of the Virginia SIP and EPA will not
be taking any rulemaking action on this portion of the SIP submittal at
this time.
Additionally, on December 16, 2003, Virginia submitted a revision
to Chapter 80, Article 9 that made a number of changes to comply with
the 1990 Amendments to the CAA, the primary of which was to redefine
the offset ratio requirements to accommodate the requirements of
Subpart I of Part C of Title I of the Act. EPA is proposing full
approval of the December 16, 2003 revision submittal.
Today's action will revise the previously approved versions of
these rules as approved into the Virginia SIP on April 21, 2000 (65 FR
21315) and September 21, 1999 (64 FR 51047), respectively.
Copies of the revised Virginia rules and submittal packages, as
well as the Technical Support Document (TSD), can be obtained from the
Docket as discussed in the ``Docket'' Section above. A discussion of
notable Virginia rule changes that are proposed for inclusion into the
SIP are included in the TSD and also summarized below.
What are the program changes that EPA is proposing limited approval?
In its December 2002 regulatory action, EPA dramatically changed
many aspects of the regulations governing the PSD and nonattainment NSR
programs (together, as ``NSR''), aimed at ``providing much needed
flexibility and regulatory certainty, and at removing barriers and
creating incentives for sources to improve environmental performance
through emissions reductions, pollution prevention, and improved energy
efficiency.'' Virginia accepted the conceptual framework of EPA's NSR
reform revisions but tailored the program to their State-specific
objectives. EPA agrees that Virginia's regulations, while different in
some limited respects, will not prevent companies from benefiting from
most, if not all of the goals of NSR reform. In general, EPA has
concluded that Virginia's regulations, overall, conform to the minimum
program elements in 40 CFR 51.165 despite some variations in their
rules from the federal program. It is EPA's position that every element
of NSR reform is present in Virginia's rules but these elements may be
implemented in a way that allows the Commonwealth more scrutiny with
respect to how NSR applies to a facility. The Virginia NSR regulations
for nonattainment areas, effective September 1, 2006 are being proposed
for limited approval today. The following describes areas within these
regulations that vary from the Federal program.
Notable Variations in Article 9 From the Federal Program
1. In the EPA regulations, the period used for establishing the
baseline for each pollutant can be different for each pollutant. The
Virginia regulations require that it be the same for all pollutants,
except where extenuating circumstances would allow use of
[[Page 36479]]
different baseline periods. This variation is acceptable to EPA.
2. The EPA regulations do not specify consequences where the owner
determines there is a reasonable possibility that a project that is not
a part of a major modification may result in a significant emissions
increase and does not obtain a permit. The Virginia regulations specify
how the state will act should the owner fail to make an accurate
determination. EPA believes that this variation from the federal rule
has no impact on approvability or the Commonwealth's ability to achieve
the goals of NSR reform and is acceptable to EPA.
Please note, the Commonwealth will soon be revising this Section of
its regulations to reflect changes made in the EPA final rule dated
December 14, 2007 providing improvements to EPA's New Source Review
program regarding ``reasonable possibility'' in recordkeeping. This
final rule provided an explanation and more detailed criteria to
clarify the ``reasonable possibility'' recordkeeping and reporting
standard of the 2002 New Source Review Reform rule. The improvements
provided in the December 14, 2007 rulemaking were to reflect the
amendments found necessary to respond to the decision of the U.S. Court
of Appeals for the DC Circuit in New York v. EPA, 413 F.3d 3 (DC Cir.
2005) (New York) which remanded this portion of the December 2002
regulations for EPA to provide an acceptable explanation for its
``reasonable possibility'' standard or to devise an appropriately
supported alternative.
3. The EPA regulations exclude emission increases that could be
accommodated and are unrelated to the project, including demand growth,
from projected actual emissions. The Virginia regulations included this
exclusion but have been revised in order to clarify the intent of the
provision and ensure consistency in its application. This variation is
acceptable to EPA.
4. The EPA regulations require owners to develop and maintain
information to support their determination that a given project is not
a part of a major modification that may result in a significant
emissions increase. The Virginia regulations require advance
notification of the availability of the information prior to beginning
actual construction of the project. This variation is acceptable to
EPA.
5. The EPA regulations establish Plantwide Applicability Limits
(PALs) with a duration of 10 years; the Virginia regulations contain
five-year durations for PALs. This variation is acceptable to EPA.
6. This SIP revision also includes other non-substantive changes to
Virginia's Nonattainment New Source Review program. There was a need to
update regulatory citations, making consistency revisions to the text
to bring the regulations in the Commonwealth up to date. EPA's analysis
has found that these non-substantative changes do not change any of the
minimum regulatory requirements and are acceptable.
Once again, the TSD, (located in the Docket), can be reviewed for
an in-depth and full explanation of EPA's regulatory analysis of the
Virginia Nonattainment New Source Review program.
III. Limited Approval
Why is EPA proposing ``limited approval'' versus ``full approval'' of
Virginia's NSR regulations, effective September 1, 2006 for
Nonattainment NSR areas?
The Clean Air Act does not expressly provide for limited approvals,
therefore EPA is using its gap-filling authority under section 301(a)
of the Act in conjunction with the section 110(k)(3) approval provision
to interpret the Act to provide for this type of limited approval
action. A key aspect of these limited approval actions is that they
encompass the entire rule based on the fact that even with limitations,
the approval of the entire rule will strengthen the Commonwealth's SIP.
The primary advantage to using this limited approval is that it will
make the Commonwealth's revision submittal Federally enforceable and
will increase the SIP's potential to achieve additional reductions.
The following is an explanation for this limited approval of the
SIP revision by EPA. In Virginia's regulations under 9 VAC 5-80-2010 a
new definition was added to reflect the necessary changes to the
program found in the 2002 Federal NSR Reform rule.
Virginia's definition for ``baseline actual emissions'' varies from
the Federal definition at 40 CFR 51.166(b)(47) in two ways. First, for
both electric generating units (EGUs) and non-EGUs, Virginia's rule
allows the use of different baselines for different pollutants if the
owner can demonstrate to the satisfaction of the State Air Pollution
Control Board (Board) that a different baseline period for a different
pollutant(s) is more appropriate due to extenuating circumstances. This
is acceptable to EPA. However in the second instance, for non-EGUs, the
24-month baseline period must occur within the five-year period
preceding the date the owner begins actual construction or the permit
application is deemed complete, whichever is earlier, unless the Board
allows a different time period that it deems is more representative of
normal source operations. The allowance of a different or an extended
time period by the Board is acceptable as it allows a time period past
the more limiting 5-year period, however, the Commonwealth's
regulations do not further restrict the Board from allowing a time
period which could extend past the 10-year period currently provided in
the Federal NSR Reform rule.
The Virginia regulations, therefore, meet the general Federal
criteria for expanding the lookback period beyond the old requirement
of the most recent 24-month period, and are thus equivalent to the
Federal requirement. The purpose of an extended lookback is to
establish a period that is most representative of source operation.
Establishment of the most representative operation not only enables
sources to plan effective emissions control strategies, it also
provides Virginia with more accurate information on which to base long-
term air quality planning strategies. The 5-year lookback period can be
seen to be more limiting or at times more restrictive than the Federal
rule. Requiring a 5-year lookback instead of a 10-year lookback may,
however, limit a source's potential to find a higher baseline. This
could in turn restrict a source's ability to emit and is thus
inherently more protective than the EPA regulations. As part of the
February 12, 2007 SIP revision submittal, the Commonwealth provided a
more detailed explanation of the 5-year lookback period.
Though it was not Virginia's intention to exceed the 10-year
lookback limitation, EPA's decision to propose limited approval is
based the Commonwealth's interpretation of its own regulations as
provided in their Technical Support Document. EPA is relying on this
interpretation of the regulations as noted above and in part, the basis
for our limited approval. Furthermore, EPA would look unfavorably upon
any use of discretion by Virginia that would allow for baselines that
exceed a 10-year lookback period. EPA expects Virginia to correct the
definition at 9 VAC 5-80-2010 by limiting the discretionary lookback
period to 10 years. When Virginia makes this amendment, they will be
eligible for consideration for full approval of its Nonattainment NSR
program found in Article 9.
[[Page 36480]]
IV. Full Approval
What is EPA proposing full approval of in this action?
On December 16, 2003, the Commonwealth of Virginia submitted a SIP
revision submittal for Chapter 80, Article 9 that made a number of
changes to comply with the 1990 Amendments to the CAA, the primary of
which was to redefine the offset ratio requirements to accommodate the
requirements of subpart I of part C of title I of the Act.
Additionally, administrative permit processing provisions were also
clarified further within this submission. EPA is proposing full
approval of the December 16, 2003 revision submittal.
V. General Information Pertaining to SIP Submittals From the
Commonwealth of Virginia
In 1995, Virginia adopted legislation that provides, subject to
certain conditions, for an environmental assessment (audit)
``privilege'' for voluntary compliance evaluations performed by a
regulated entity. The legislation further addresses the relative burden
of proof for parties either asserting the privilege or seeking
disclosure of documents for which the privilege is claimed. Virginia's
legislation also provides, subject to certain conditions, for a penalty
waiver for violations of environmental laws when a regulated entity
discovers such violations pursuant to a voluntary compliance evaluation
and voluntarily discloses such violations to the Commonwealth and takes
prompt and appropriate measures to remedy the violations. Virginia's
Voluntary Environmental Assessment Privilege Law, Va. Code Sec. 10.1-
1198, provides a privilege that protects from disclosure documents and
information about the content of those documents that are the product
of a voluntary environmental assessment. The Privilege Law does not
extend to documents or information (1) that are generated or developed
before the commencement of a voluntary environmental assessment; (2)
that are prepared independently of the assessment process; (3) that
demonstrate a clear, imminent and substantial danger to the public
health or environment; or (4) that are required by law.
On January 12, 1998, the Commonwealth of Virginia Office of the
Attorney General provided a legal opinion that states that the
Privilege law, Va. Code Sec. 10.1-1198, precludes granting a privilege
to documents and information ``required by law,'' including documents
and information ``required by Federal law to maintain program
delegation, authorization or approval,'' since Virginia must ``enforce
Federally authorized environmental programs in a manner that is no less
stringent than their Federal counterparts. * * * '' The opinion
concludes that ``[r]egarding Sec. 10.1-1198, therefore, documents or
other information needed for civil or criminal enforcement under one of
these programs could not be privileged because such documents and
information are essential to pursuing enforcement in a manner required
by Federal law to maintain program delegation, authorization or
approval.''
Virginia's Immunity law, Va. Code Section 10.1-1199, provides that
``[t]o the extent consistent with requirements imposed by Federal
law,'' any person making a voluntary disclosure of information to a
state agency regarding a violation of an environmental statute,
regulation, permit, or administrative order is granted immunity from
administrative or civil penalty. The Attorney General's January 12,
1998 opinion states that the quoted language renders this statute
inapplicable to enforcement of any Federally authorized programs, since
``no immunity could be afforded from administrative, civil, or criminal
penalties because granting such immunity would not be consistent with
Federal law, which is one of the criteria for immunity.''
Therefore, EPA has determined that Virginia's Privilege and
Immunity statutes will not preclude the Commonwealth from enforcing its
NSR program consistent with the Federal requirements. In any event,
because EPA has also determined that a state audit privilege and
immunity law can affect only state enforcement and cannot have any
impact on Federal enforcement authorities, EPA may at any time invoke
its authority under the Clean Air Act, including, for example, sections
113, 167, 205, 211 or 213, to enforce the requirements or prohibitions
of the state plan, independently of any state enforcement effort. In
addition, citizen enforcement under section 304 of the Clean Air Act is
likewise unaffected by this, or any, state audit privilege or immunity
law.
VI. Proposed Action
EPA has determined that the amendments to Virginia's nonattainment
new source review permit program at Articles 4 and 9, as submitted on
February 12, 2007 meet the minimum requirements of 40 CFR 51.165 and
the Clean Air Act. This amendment is being proposed as a limited
approval as described in Section III above, as a revision to the
Virginia SIP. EPA is also proposing full approval of changes submitted
to the nonattainment new source review permit program at Article 9, as
submitted on December 16, 2003 and as described in Section IV above as
a revision to the Virginia SIP. EPA is soliciting public comments on
the issues discussed in this document. These comments will be
considered before taking final action.
VII. Statutory and Executive Order Reviews
Under the Clean Air Act, the Administrator is required to approve a
SIP submission that complies with the provisions of the Act and
applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a).
Thus, in reviewing SIP submissions, EPA's role is to approve state
choices, provided that they meet the criteria of the Clean Air Act.
Accordingly, this action merely proposes to approve state law as
meeting Federal requirements and does not impose additional
requirements beyond those imposed by state law. For that reason, this
proposed action:
Is not a ``significant regulatory action'' subject to
review by the Office of Management and Budget under Executive Order
12866 (58 FR 51735, October 4, 1993);
Does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
Is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
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);
Does not have Federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
Is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
Is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);
Is not subject to requirements of Section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the Clean Air Act; and
Does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human
[[Page 36481]]
health or environmental effects, using practicable and legally
permissible methods, under Executive Order 12898 (59 FR 7629, February
16, 1994).
In addition, this proposed rule for limited approval of the SIP
revision submitted on February 12, 2007 and the full approval of the
SIP revision submitted on December 16, 2003 for facilities located or
locating in nonattainment areas for Virginia nonattainment new source
review does not have tribal implications as specified by Executive
Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not
approved to apply in Indian country located in the state, and EPA notes
that it will not impose substantial direct costs on tribal governments
or preempt tribal law.
List of Subjects in 40 CFR Part 52
Environmental protection, Air pollution control, Carbon monoxide,
Intergovernmental relations, Nitrogen dioxide, Ozone, Particulate
matter, Reporting and recordkeeping requirements, Sulfur oxides,
Volatile organic compounds.
Authority: 42 U.S.C. 7401 et seq.
Dated: June 17, 2008.
William T. Wisniewski,
Acting Regional Administrator, Region III.
[FR Doc. E8-14625 Filed 6-26-08; 8:45 am]
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