[Federal Register Volume 75, Number 71 (Wednesday, April 14, 2010)]
[Rules and Regulations]
[Pages 19468-19493]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-8019]
[[Page 19467]]
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Part II
Environmental Protection Agency
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40 CFR Part 52
Approval and Promulgation of Implementation Plans; Texas; Revisions to
the New Source Review (NSR) State Implementation Plan (SIP);
Modification of Existing Qualified Facilities Program and General
Definitions; Final Rule
Federal Register / Vol. 75, No. 71 / Wednesday, April 14, 2010 /
Rules and Regulations
[[Page 19468]]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52
[EPA-R06-OAR-2005-TX-0025; FRL-9135-7]
Approval and Promulgation of Implementation Plans; Texas;
Revisions to the New Source Review (NSR) State Implementation Plan
(SIP); Modification of Existing Qualified Facilities Program and
General Definitions
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final Rule.
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SUMMARY: EPA is taking final action to disapprove revisions to the SIP
submitted by the State of Texas that relate to the Modification of
Existing Qualified Facilities (the Qualified Facilities Program or the
Program). EPA is disapproving the Texas Qualified Facilities Program
because it does not meet the Minor NSR SIP requirements nor does it
meet the NSR SIP requirements for a substitute Major NSR SIP revision.
EPA is also approving three definitions that are severable from the
Qualified Facilities submittals. These three definitions we are
approving are, ``grandfathered facility,'' ``maximum allowable emission
rate table (MAERT),'' and ``new facility.'' Moreover, we are making an
administrative correction to the SIP-approved definition of
``facility.''
We are taking this action under section 110, part C, and part D of
the Federal Clean Air Act (the Act or CAA).
DATES: This rule is effective on May 14, 2010.
ADDRESSES: EPA has established a docket for this action under Docket ID
No. EPA-R06-OAR-2005-TX-0025. All documents in the docket are listed on
the http://www.regulations.gov Web site. Although listed in the index,
some information is not publicly available, e.g., confidential business
information 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 through http://www.regulations.gov or in hard copy at
the Air Permits Section (6PD-R), Environmental Protection Agency, 1445
Ross Avenue, Suite 700, Dallas, Texas 75202-2733. The file will be made
available by appointment for public inspection in the Region 6 FOIA
Review Room between the hours of 8:30 a.m. and 4:30 p.m. weekdays
except for legal holidays. Contact the person listed in the FOR FURTHER
INFORMATION CONTACT paragraph below to make an appointment. If
possible, please make the appointment at least two working days in
advance of your visit. There will be a 15 cent per page fee for making
photocopies of documents. On the day of the visit, please check in at
the EPA Region 6 reception area at 1445 Ross Avenue, Suite 700, Dallas,
Texas.
The State submittal, which is part of the EPA record, is also
available for public inspection at the State Air Agency listed below
during official business hours by appointment: Texas Commission on
Environmental Quality, Office of Air Quality, 12124 Park 35 Circle,
Austin, Texas 78753.
FOR FURTHER INFORMATION CONTACT: Mr. Stanley M. Spruiell, Air Permits
Section (6PD-R), Environmental Protection Agency, Region 6, 1445 Ross
Avenue, Suite 700, Dallas, Texas 75202-2733, telephone (214) 665-7212;
fax number 214-665-7263; e-mail address [email protected].
SUPPLEMENTARY INFORMATION: Throughout this document, the following
terms have the meanings described below:
``we,'' ``us,'' and ``our'' refer to EPA.
``Act'' or ``CAA'' means Federal Clean Air Act.
``40 CFR'' means Title 40 of the Code of Federal
Regulations--Protection of Environment.
``SIP'' means State Implementation Plan as established
under section 110 of the Act.
``NSR'' means new source review, a phrase intended to
encompass the statutory and regulatory programs that regulate the
construction and modification of stationary sources as provided under
CAA section 110(a)(2)(C), CAA Title I, parts C and D, and 40 CFR 51.160
through 51.166.
``Minor NSR'' means NSR established under section 110 of
the Act and 40 CFR 51.160.
``Major NSR'' means any new or modified source that is
subject to NNSR and/or PSD.
``NNSR'' means nonattainment NSR established under Title
I, section 110 and part D of the Act and 40 CFR 51.165.
``PSD'' means prevention of significant deterioration of
air quality established under Title I, section 110 and part C of the
Act and 40 CFR 51.166.
``Program'' means the SIP revision submittals from the
TCEQ concerning the Texas Qualified Facilities Program.
``NAAQS'' means any national ambient air quality standard
established under 40 CFR part 50.
Table of Contents
I. What Action Is EPA Taking?
II. What Submittals Is EPA Taking No Action On?
A. Subparagraph (F) under the definition of ``federally
enforceable''
B. Definition of ``best available control technology (BACT)''
C. Subparagraphs (A) and (B) of the submitted definition of
``modification of existing facility''
D. Subparagraph (G) of the submitted definition of
``modification of existing facility''
E. Trading Provision in 30 TAC 116.116(f)
III. What Is the Background for This Action?
A. Summary of Our Proposed Action
B. Summary of the Submittals Addressed in this Final Action
C. Other Relevant Actions on the Texas Permitting SIP Revision
Submittals
IV. What Are the Grounds for This Disapproval Action of the Texas
Qualified Facilities Program?
A. Why the Qualified Facilities Program Submittal Is Unclear
Whether It Is for a Major or Minor NSR SIP Revision
B. Why the Submitted Texas Qualified Facilities Program Is Not
Approvable as a Substitute Major NSR SIP Revision
C. Why the Submitted Texas Qualified Facilities Program Is Not
Approvable as a Minor NSR SIP Revision
D. Definition of ``facility''
V. Response to Comments
A. General Comments
B. Comment That This Action Is Inconsistent With the CAA
C. Comments Addressing Whether the Qualified Facilities Rules
Allow Sources to ``Net Out'' of Major and Minor NSR Through Rules
that Are Not Adequate To Protect the NAAQS and State Control
Strategies
D. Comments Addressing Whether the Qualified Facilities Rules
Are Practically Enforceable
E. Comments Addressing Whether the Qualified Facilities Rules
Meet Federal Requirements for Major NSR
F. Comments Addressing Whether the Qualified Facilities Rules
Meet Federal Requirements for Minor NSR
G. Comments Addressing Whether Existing Qualified Facilities
Have Undergone an Air Quality Analysis
H. Comments on the Definitions of ``Grandfathered Facility,''
``Maximum Allowable Emission Rate Table,'' and ``New Facility''
I. Comments on the Definitions of ``Actual Emissions,''
``Allowable Emissions,'' ``Modification of Existing Facility'' at
(E), and ``Qualified Facility''
J. Comments on the Definition of ``Best Available Control
Technology'' (``BACT'')
K. Comments on Severable Portions of the Definition of
``Modification of Existing Facility'' at 30 TAC 116.10(11)(A) and
(B)
L. Comments on the Definition of Severable Subsection of
``Modification of
[[Page 19469]]
Existing Facility'' at 30 TAC 116.10(11)(G)
M. Comments on the Reinstatement of the Previously Approved
Definition of ``Facility''
N. Comments on the Definition of the Term ``Air Quality Account
Number''
O. Comments on Whether the Qualified Facilities Rules Meet NSR
Public Participation Requirements
VI. Final Action
VII. Statutory and Executive Order Reviews
I. What Action Is EPA Taking?
EPA is taking final action to disapprove the Texas Qualified
Facilities Program, as submitted by Texas on March 13, 1996, and July
22, 1998, in Title 30 of the Texas Administrative Code (30 TAC) at 30
TAC Chapter 116--Control of Air Pollution by Permits for New
Construction or Modification. This includes the following regulations
under Chapter 116: 30 TAC 116.116(e), 30 TAC 116.117, 30 TAC 116.118,
and the following definitions under 30 TAC 116.10--General Definitions:
30 TAC 116.10(1)--definition of ``actual emissions,'' 30 TAC
116.10(2)--definition of ``allowable emissions,'' 30 TAC 116.10(11)(E)
under the definition of ``modification of existing facility,'' and 30
TAC 116.10(16)--definition of ``qualified facility.'' These regulations
and definitions do not meet the requirements of the Act and EPA's NSR
regulations. It is EPA's position that none of these identified
elements for the submitted Qualified Facilities Program is severable
from each other.
Secondly, in an action separate from the above action on the
submitted Texas Qualified Facilities Program, we are approving the
following severable definitions: 30 TAC 116.10(8)--definition of
``grandfathered facility,'' 30 TAC 116.10(10)--definition of ``maximum
allowable emission rate table (MAERT),'' and 30 TAC 116.10(12)--
definition of ``new facility.'' It is EPA's position that these
definitions are severable from those in the submitted Texas Qualified
Facilities Program; moreover, each is severable from each other.
EPA proposed the above actions on September 23, 2009 (74 FR 48450).
We accepted comments from the public on this proposal from September
23, 2009, until November 23, 2009. A summary of the comments received
and our evaluation thereof is discussed in section V below. In the
proposal and in the Technical Support Document (TSD), we described our
basis for the actions identified above. The reader should refer to the
proposal, the TSD, section IV of this preamble, and the Response to
Comments in section V of this preamble for additional information
relating to our final action.
We are disapproving the submitted Texas Qualified Facilities
Program as not meeting the requirements for a substitute Major NSR SIP
revision. Our grounds for disapproval as a substitute Major NSR SIP
revision include the following:
It is not clearly limited to Minor NSR thereby allowing
major modifications to occur without a Major NSR permit;
It has no regulatory provisions clearly prohibiting the
use of this Program from circumventing the Major NSR SIP requirements
thereby allowing changes at existing facilities to avoid the
requirement to obtain preconstruction permit authorizations for
projects that would otherwise require a Major NSR preconstruction
permit;
It does not require that first an applicability
determination be made whether the modification is subject to Major NSR
thereby exempting new major stationary sources and major modifications
from the EPA Major NSR SIP requirements;
It does not include a demonstration from the TCEQ, as
required by 40 CFR 51.166(a)(7)(iv), showing how the use of
``modification'' is at least as stringent as the definition of
``modification'' in the EPA Major NSR SIP program
It does not include the requirement to make Major NSR
applicability determinations based on actual emissions and on emissions
increases and decreases (netting) that occur within a major stationary
source;
It fails to meet the statutory and regulatory requirements
for a SIP revision;
It is not consistent with applicable statutory and
regulatory requirements as interpreted in EPA policy and guidance on
SIP revisions; and
EPA lacks sufficient available information to determine
that the requested relaxation to the Texas Major NSR SIP will not
interfere with any applicable requirement concerning attainment and
reasonable further progress (RFP), or any other applicable requirement
of the Act.
In addition to the failures to protect Major NSR SIP requirements,
EPA cannot find that the submitted Program, as an exemption to the
State's Minor NSR SIP program, will ensure noninterference with NAAQS
attainment, and there will not be a violation of applicable portions of
a Texas SIP control strategy, as required by section 110(a)(2)(D) and
40 CFR 51.160(a)-(b). EPA cannot approve the exempting of certain
modifications from obtaining a Minor NSR SIP permit as part of the
Texas Minor NSR SIP because the Act and EPA regulations are not met and
the State has not shown that the sources will have only a de minimis
effect. The Program fails to include legally enforceable procedures to
ensure that the State will not permit a modification that will violate
the control strategies or interfere with NAAQS attainment. Our grounds
for disapproval as a Minor NSR SIP revision include the following:
It is not clearly limited to Minor NSR thereby allowing
major modifications to occur without a Major NSR permit;
It has no regulatory provisions clearly prohibiting the
use of this Program from circumventing the Major NSR SIP requirements
thereby allowing sources to avoid the requirement to obtain
preconstruction permit authorizations for projects that would otherwise
require a Major NSR preconstruction permit;
It does not require that first an applicability
determination be made whether the modification is subject to Major NSR
thereby exempting new major stationary sources and major modifications
from the EPA Major NSR SIP requirements;
It fails to meet the statutory and regulatory requirements
for a SIP revision;
It is not consistent with applicable statutory and
regulatory requirements as interpreted in EPA policy and guidance on
SIP revisions;
It is not an enforceable Minor NSR permitting program;
It lacks legally enforceable safeguards to ensure that the
exempted changes will not violate a Texas control strategy and will not
interfere with NAAQS attainment;
EPA lacks sufficient available information to determine
that the requested relaxation to the Texas Minor NSR SIP will not
interfere with any applicable requirement concerning attainment and
RFP, or any other applicable requirement of the Act.
The provisions in these submittals relating to the Texas Qualified
Facilities State Program that include the Chapter 116 regulatory
provisions and the nonseverable definitions in the General Definitions
were not submitted to meet a mandatory requirement of the Act.
Therefore, this final action to disapprove the submitted Texas
Qualified Facilities State Program does not trigger a sanctions or
Federal Implementation Plan clock. See CAA section 179(a).
[[Page 19470]]
II. What Submittals Is EPA Taking No Action On?
A. Subparagraph (F) Under the Definition of ``Federally Enforceable''
On September 18, 2002 (67 FR 58697), EPA approved the definition of
``federally enforceable'' in 30 TAC 116.10(7), introductory paragraph
and subparagraphs (A) through (E), as submitted July 22, 1998. We
proposed to take no action on the submitted severable new subparagraph
(F) under the SIP-approved definition of ``federally enforceable,''
submitted September 11, 2000, because it is outside the scope of the
SIP. See 74 FR 48450, at 48466. EPA is not finalizing action today on
the proposal concerning the submitted 30 TAC 116.10(7)(F). This
subparagraph (F) is severable from the final rulemaking on the
Qualified Facilities Program
B. Definition of ``Best Available Control Technology (BACT)''
On September 23, 2009, EPA proposed to disapprove the definition
``best available control technology (BACT)'' under 30 TAC 1161.10(3).
74 FR 48450, at 48463-48464. EPA is still reviewing approvability of
this definition; therefore, we are not taking final action on the
proposal today. This definition is severable from the final rulemaking
on the Qualified Facilities Program. We will take final action on the
definition of BACT when we take action on Texas's submission concerning
NSR Reform (Rule Project Number 2005-010-116-PR), which also addresses
BACT. See 74 FR 48450, at 48472.\1\ Under the Consent Decree entered on
January 21, 2010 in BCCA Appeal Group v. EPA, Case No. 3:08-cv-01491-N
(N.D. Tex), EPA's final action concerning NSR Reform will be finalized
by August 31, 2010.
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\1\ EPA made this determination in a separate proposed action
published at 74 FR 48467, September 23, 2009. This proposal relates
to Prevention of Significant Deterioration (PSD), Nonattainment NSR
(NNSR) for the 1997 8-Hour Ozone Standard, NSR Reform, and a
Standard Permit.
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C. Subparagraphs (A) and (B) of the Submitted Definition of
``Modification of Existing Facility''
Also, on September 23, 2009, EPA proposed to disapprove 30 TAC
116.10(11) subparagraphs (A) and (B) of the submitted definition of
``modification of existing facility,'' which are severable from the
other submissions addressed in this notice but not severable from each
other. 74 FR 48450, at 48464-48465. EPA is not taking final action
today on the proposed disapproval of these submitted subparagraphs
under the submitted definition of ``modification of existing facility''
at 30 TAC 116.0(11)(A) and (B). We are still reviewing the proposed
disapproval of these subparagraphs 30 TAC 116.10(11)(A) and (B) which
relate to ``insignificant increases.'' These subparagraphs are
severable from this final rulemaking on the Qualified Facilities
Program. We will take final action on 30 TAC 116.10(11)(A) and (B) when
we act on Texas's submission concerning Air Permits (SB 766) Phase II
(Rule Project Number 99029B-116-A1). Under the Settlement Agreement in
BCCA Appeal Group v. EPA, Case No. 3:08-cv-01491-N (N.D. Tex), that
action will be finalized by December 31, 2012. Additionally, we have
received petitions requesting EPA review of the State's implementation
of Texas Commission on Environmental Quality's (TCEQ) permit by rule
(PBR) program under Subchapter K (30 TAC Chapter 106).\2\ EPA intends
to review TCEQ's PBR program and its implementation in response to
those petitions.
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\2\ Petitions, August 28, 2008, from the Environmental Integrity
Project on behalf of the Galveston-Houston Association for Smog
Prevention, Environmental Integrity Project, Texas Campaign for the
Environment, Sierra Club, and Public Citizen; and January 5, 2009,
supplementing the August 28, 2008, petition (the supplemental
petition added the Environmental Defense Fund as an additional
petitioner).
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D. Subparagraph (G) of the Submitted Definition of ``Modification of
Existing Facility''
On September 23, 2009, EPA proposed to disapprove the subparagraph
(G) at 30 TAC 116.10(11) of the submitted definition of ``modification
of existing facility.'' See 74 FR 48450, at 48465. EPA is not taking
final action today on the proposed disapproval of the submitted
subparagraph (G) of the definition of ``modification of existing
facility.'' We are still reviewing the proposed disapproval of this
definition. This subparagraph states that changes to certain natural
gas processing, treating, or compression facilities are not
modifications if the change does not result in an annual emissions rate
of any air contaminant in excess of the volume emitted at the maximum
design capacity for grandfathered facilities. This definition is
severable from this rulemaking on the Qualified Facilities Program. See
74 FR 48450, at 48452. We will take final action on 30 TAC
116.10(11)(G) when we act on Texas's submission concerning Air Permits
(SB 766) Phase II (Rule Project Number 99029B-116-A1). Under the
Settlement Agreement in BCCA Appeal Group v. EPA, Case No. 3:08-cv-
01491-N (N.D. Tex), that action will be finalized by December 31, 2012.
E. Trading Provision in 30 TAC 116.116(f)
EPA proposed to take no action on the submitted portion of 30 TAC
116.116(f) that includes, among other things, a trading provision
containing a cross-reference that is no longer in Texas's rules. See 74
FR 48450, at 48465-48466. EPA is not taking final action today on this
submitted portion because we are still reviewing approvability of the
provision. This portion of the provision is severable from this
rulemaking on the Qualified Facilities Program. We will take final
action on 30 TAC 116.116(f) when we take action on Texas's submission
concerning NSR Rules Revisions; 112(g) Revisions (Rule Project No.
98001-116-AI). Under the Settlement Agreement in BCCA Appeal Group v.
EPA, Case No. 3:08-cv-01491-N (N.D. Tex), that action will be finalized
by October 31, 2011.
III. What Is the Background?
A. Summary of Our Proposed Action
Also on September 23, 2009 (74 FR 48450), EPA proposed to
disapprove revisions to the SIP submitted by the State of Texas that
relate to the Modification of Qualified Facilities. These affected
provisions include regulatory provisions at 30 TAC 116.116(e) and
definitions of ``actual emissions,'' ``allowable emissions,'' a
nonseverable portion of the definition at subparagraph (E) of
``modification of existing facility,'' and ``qualified facility'' under
Texas's General Definitions in Chapter 116, Control of Air Pollution by
Permits for New Construction or Modification. See 30 TAC 116.10(1),
(2), (11)(E), and (16), respectively. EPA finds that these submitted
provisions and definitions in the submittals affecting the Texas
Qualified Facilities Program are not severable from each other.
In the September 23, 2009, EPA also proposed to take action on
revisions to the SIP submitted by Texas that relate to the General
Definitions in Chapter 116. EPA proposed to approve three of these
submitted definitions, ``grandfathered facility,'' ``maximum allowable
emissions rate table (MAERT),'' and ``new facility'' at 30 TAC
116.10(8), (10), and (12), respectively. These definitions are
severable from the Qualified Facilities Program.
EPA proposed to make an administrative correction to the severable
submittal for the SIP-approved
[[Page 19471]]
definition of ``facility'' under 30 TAC 116.10(6). Consistent with our
proposal, EPA is finalizing this administrative correction in today's
action. Specifically, EPA corrects a typographical error at 72 FR 49198
(August 28, 2007), to clarify that the definition of ``facility,'' as
codified at 30 TAC 116.10(6), was approved as part of the Texas SIP in
2006 and remains part of the Texas SIP. 74 FR 48450, at 48465.
See Sections I and IV for further information on EPA's final action
on the above submittals.
Further, EPA proposed to disapprove the following severable
definitions: (1) the submitted definition of ``best available control
technology (BACT)'' and (2) subparagraphs (A) and (B) of the submitted
definition of ``modification of existing facility,'' which are
severable from the other submissions but not severable from each other,
and (3) subparagraph (G) of the submitted definition of ``modification
of existing facility.'' EPA proposed to take no action on the severable
submitted subparagraph (F) for the SIP-approved severable definition of
``federally enforceable'' under 30 TAC 116.10(7) because the submitted
paragraph relates to a federal program that is implemented separately
from the SIP. In addition, EPA proposed to take no action on the
severable submitted portion of a provision at 30 TAC 116.116(f) that
includes, among other things, a trading provision containing a cross-
reference that no longer is in Texas's rules. See Section II for
further information on why EPA is not taking final action today on
these submittals.
B. Summary of the Submittals Addressed in this Final Action
Table 1 below summarizes the changes that are in the SIP revision
submittals. A summary of EPA's evaluation of each section and the basis
for this action is discussed in Sections IV through VI of this
preamble. The Technical Support Document includes a detailed evaluation
of the submittals.
Table 1--Summary of Each SIP Submittal That is Affected by This Action.
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Submittal
Section Title dates Description of change Proposed action
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30 TAC 116.10................... General Definitions
30 TAC 116.10(1)................ Definition of 3/13/1996 Added new definition... Disapproval.
``actual
emissions''.
7/22/1998 Repealed and a new
definition submitted
as paragraph (1).
30 TAC 116.10(2)................ Definition of 3/13/1996 Added new definition... Disapproval.
``allowable
emissions''.
7/22/1998 Repealed and a new
definition submitted
as paragraph (2).
9/11/2000 Revised paragraphs
(2)(A) through (D).
30 TAC 116.10(6)................ Definition of 3/13/1996 Added new definition... Administrative
``facility''. correction to
clarify the
definition of
``facility'' is in
the SIP.
7/22/1998 Repealed and a new
definition submitted
as paragraph (4).
Approved 9/6/2006 (71
FR 52698).
9/4/2002 Redesignated to
paragraph (6).
Inadvertently
identified as non-SIP
provision in 8/28/2007
SIP revision.
30 TAC 116.10(8)................ Definition of 3/13/1996 Added new definition... Approval.
``grandfathered
facility''.
7/22/1998 Repealed and a new
definition submitted
as paragraph (6).
7/31/2002 Revised definition.....
9/4/2002 Redesignated to
paragraph (8).
30 TAC 116.10(10)............... Definition of 3/13/1996 Added new definition... Approval.
``maximum
allowable emission
rate table''.
7/22/1998 Repealed and a new
definition submitted
as paragraph (8).
9/4/2002 Redesignated to
paragraph (10).
30 TAC 116.10(11)............... Definition of 3/13/1996 Added new definition... Disapproval of
``modification of subparagraph (E).
existing
facility''.
7/22/1998 Repealed and a new
definition submitted
as paragraph (9).
9/4/2002 Redesignated to
paragraph (11).
30 TAC 116.10(12)............... Definition of ``new 3/13/1996 Added new definition... Approval.
facility''.
7/22/1998 Repealed and a new
definition submitted
as paragraph (10).
9/04/2002 Redesignated to
paragraph (12).
30 TAC 116.10(16)............... Definition of 3/13/1996 Added new definition... Disapproval.
``qualified
facility''.
7/22/1998 Repealed and a new
definition submitted
as paragraph (14).
9/4/2002 Redesignated to
paragraph (16).
30 TAC 116.116.................. Changes to 3/13/1996 Added subsection (e)... Disapproval.
Facilities.
7/22/1998 Repealed and a new Disapproval.
116.116(e) submitted.
[[Page 19472]]
30 TAC 116.117.................. Documentation and 3/13/1996 Added new section...... Disapproval.
Notification of
Changes to
Qualified
Facilities.
7/22/1998 Repealed and a new
116.117 resubmitted.
30 TAC 116.118.................. Pre-Change 3/13/1996 Added new section...... Disapproval.
Qualification.
7/22/1998 Repealed and a new
116.118 submitted.
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C. Other Proposed Relevant Actions on the Texas Permitting SIP Revision
Submittals
The Settlement Agreement in BCCA Appeal Group v. EPA, Case No.
3:08-cv-01491-N (N.D. Tex), as amended, currently provides that EPA
will take final action on the State's Public Participation SIP revision
submittal on October 29, 2010. EPA intends to take final action on the
submitted Texas Flexible Permits State Program by June 30, 2010, and
the NSR SIP by August 31, 2010, as provided in the Consent Decree
entered on January 21, 2010 in BCCA Appeal Group v. EPA, Case No. 3:08-
cv-01491-N (N.D. Tex).
Additionally, EPA acknowledges and appreciates that TCEQ is
developing a proposed rulemaking package to address EPA's concerns with
the current Qualified Facilities rules. We will, of course, consider
any rule changes if and when they are submitted to EPA for review.
However, the rules before us today are those of the current Qualified
Facilities program, and we have concluded that the current program is
not approvable for the reasons set out in this notice.
IV. What Are the Grounds for This Disapproval Action of the Texas
Qualified Facilities Program?
EPA is disapproving revisions to the SIP submitted by the State of
Texas that relate to the Modification of Qualified Facilities,
identified in the above Table 1. Sources are reminded that they remain
subject to the requirements of the Federally- approved Texas SIP and
may be subject to enforcement actions for violations of the SIP. See
EPA's Revised Guidance on Enforcement During Pending SIP Revisions,
(March 1, 1991). However, because the Qualified Facilities Program is a
permitting exemption, not a permit amendment, this final disapproval
action does not affect Federal enforceability of Major and Minor NSR
SIP permits.
The provisions affected by this disapproval action include
regulatory provisions at 30 TAC 116.116(e), 116.117, and 116.118; and
definitions at 30 TAC 116.10(1), (2), (11)(E), and (16) under 30 TAC
Chapter 116, Control of Air Pollution by Permits for New Construction
or Modification. EPA finds that these submitted provisions and
definitions in the submittals affecting the Texas Qualified Facilities
Program are not severable from each other. Specifically, EPA is making
the following findings and taking the following actions as described
below:
A. Why the Qualified Facilities Program Submittal Is Unclear Whether it
Is for a Major or Minor NSR SIP Revision
While the TCEQ and other commenters asserted that the program was
intended to be limited to Minor NSR, we continue to be concerned that
the program is not explicitly limited to Minor NSR. Specifically, EPA
finds that the submittals contain no applicability statement or
regulatory provision that limits applicability to minor modifications.
The Program is analogous to two other Minor NSR programs in Texas's SIP
because although they do not exempt facilities from NSR, as does the
Qualified Facilities Program, they do exempt facilities from obtaining
source-specific (i.e., case-by-case) permits. However, both of the
State's other Minor NSR programs include an applicability statement and
a regulatory provision that expressly limits applicability to minor
modifications.\3\ Moreover, the Texas Clean Air Act clearly prohibits
the use of these two other Minor NSR programs for Major NSR. See Texas
Health and Safety Code 382.05196 and .057. Therefore, the absence of
these provisions in the Qualified Facilities rules creates an
unacceptable ambiguity in the SIP. Without a clear statement of
applicability of the Program, the Program as submitted is confusing to
the public, regulated sources, government agencies, or a court, because
it can be interpreted as an alternative to evaluating the new
modification as a major modification under Major NSR requirements.
Because of the overbroad nature of the regulatory language in the
State's SIP revision submittal, we find that the State has failed to
limit its submitted Program only to Minor NSR. See 74 FR 48450, at
48456-48457 and Section V.E.1 below for further information.
---------------------------------------------------------------------------
\3\ The Standard Permits rules require a Major NSR applicability
determination at 30 TAC 116.610(b), and prohibit circumvention of
Major NSR at 30 TAC 116.610(c). Likewise, the Permits by Rule
provisions require a Major NSR applicability determination at 30 TAC
106.4(a)(3), and prohibit circumvention of Major NSR at 30 TAC
106.4(b).
---------------------------------------------------------------------------
Consequently, we evaluated this submitted Program as being a
substitute for the Texas Major NSR SIP. We also evaluated it for
approvability as a Minor NSR SIP. Accordingly, we evaluated whether the
submitted Program meets the requirements for a Major NSR SIP revision,
the general requirements for regulating construction of any stationary
sources contained in Section 110(a)(2)(C) of the CAA, and the
applicable statutory and regulatory requirements for an approvable SIP
revision. See 74 FR 48450, at 48457.
B. Why the Submitted Texas Qualified Facilities Program Is Not
Approvable as a Substitute Major NSR SIP Revision
EPA finds that the State failed to submit information sufficient to
demonstrate that the submitted Program's regulatory text explicitly
prevents the circumvention of Major NSR. Therefore, EPA is disapproving
the Program as not meeting the Major NSR SIP requirements to prevent
circumvention of Major NSR. See 74 FR 48450, at 48458; Sections V.C.2.
and E. below for further information.
EPA finds that that the State failed to submit information
sufficient to demonstrate that the submitted Program's regulatory text
requires an evaluation of Major Source NSR applicability before a
change is exempted from permitting. Therefore, EPA is disapproving the
Program as not meeting the Major NSR SIP requirements that require the
Major NSR applicability requirements be met. See
[[Page 19473]]
74 FR 48450, at 48458; Section V.C.2 below for further information.
We find that the Program is deficient for Major NSR netting for two
main reasons. First, the Program may allow an emission increase to net
out by taking into account emission decreases outside of the major
stationary source and, in other circumstances, allow an evaluation of
emissions of a subset of units at a major stationary source. Therefore,
the Program does not meet the CAA's definition of ``modification'' and
the Major NSR SIP requirements and is inconsistent with Alabama Power
v. Costle, 636 F.2d 323, 401-403 (DC Cir. 1980) and Asarco v. EPA, 578
F.2d 320 (DC Cir. 1978). 74 FR 48450, at 48458-48459; Section V.C.1
below. Second, the Program authorizes existing allowable emissions,
rather than actual emissions, to be used as a baseline to determine
applicability. This use of allowables is inconsistent with the
requirements of the Act for Major NSR and is contrary to New York v.
EPA, 413 F.3d 3, 38-40 (DC Cir. 2005) (``New York I''). 74 FR 48450, at
48459; Section V.C.1 below.
EPA finds that it lacks sufficient available information to
determine, pursuant to section 110(l) that the requested relaxation to
the Texas NSR SIP would not interfere with any applicable requirement
concerning attainment and RFP, or any other applicable CAA requirement.
See 74 FR 48450, at 48459 for further information.
C. Why the Submitted Texas Qualified Facilities Program Is Not
Approvable as a Minor NSR SIP Revision
EPA finds that the Program is not clearly limited to Minor NSR. The
submitted Program also does not prevent circumvention of the Major NSR
SIP requirements. The Program lacks requirements necessary for
enforcement of the applicable emissions limitations, including a permit
application and issuance process. Overall, the Program fails to include
sufficient legally enforceable safeguards to ensure that the NAAQS and
control strategies are protected. Furthermore, the Program provides a
de minimis exemption from the Texas Minor NSR SIP, and therefore, it is
a SIP relaxation, which creates a risk of interference with NAAQS
attainment, RFP, or any other requirement of the Act. EPA lacks
sufficient information to determine that this SIP relaxation would not
interfere with these requirements. 74 FR 48450, at 48463. Additionally,
the legal test for whether a de minimis threshold can be approved is
whether it is consistent with the need for a plan to include legally
enforceable procedures to ensure that the State will not permit a
source that will violate the control strategy or interfere with NAAQS
attainment, as required by 40 CFR 51.160(a)-(b). 74 FR 48450, at 48460.
The State failed to demonstrate that this exemption will not permit
changes that will violate the Texas control strategies or interfere
with NAAQS attainment. Therefore, we are disapproving the submitted
Qualified Facilities Program as a Minor NSR SIP revision because it
does not meet sections 110(a)(2)(C) and 110(l) of the Act and 40 CFR
51.160.
The Qualified Facilities Program does not ensure protection of the
NAAQS and prevent violations of any State control strategy. First, the
Program fails to ensure that all participating Qualified Facilities
must have obtained a Texas NSR SIP permit. Without the assurance that
all Qualified Facilities have obtained a Texas NSR SIP permit, EPA
cannot determine that all Qualified Facilities must have Federally
enforceable emission limitations based on the chosen control
technology, and that the Qualified Facility will not interfere with
attainment and maintenance of the NAAQS or violate any control
strategy. Therefore, EPA finds that the Qualified Facilities Program is
inadequate to ensure that all Qualified Facilities have an appropriate
allowable limit to prevent interference with attainment and maintenance
of the NAAQS or violations of any State control strategy that is
required by the Texas NSR SIP. See Section V.G.1 for further
information. In addition, the Program does not require the owner or
operator to maintain the information and analysis showing how it
concluded that there will be no adverse impact on ambient air quality
before undertaking the change. Therefore, EPA finds that the Qualified
Facilities Program is inadequate to ensure that all changes under the
Program that are exempted from permitting will not prevent interference
with attainment and maintenance of the NAAQS or violations of any State
control strategy that is required by the Texas NSR SIP. 74 FR 48450, at
48462; Section V.F.1.
Regarding the State's use of minor source netting in the Qualified
Facilities Program, EPA makes the following findings:
The Qualified Facilities Program is inadequate because it fails to
provide clear and enforceable requirements for a basic netting program.
Therefore, this Program, as submitted, does not meet the fundamental
requirements for an approvable Minor NSR netting program. To analyze
the Program's Minor NSR netting for approvability, we used the
fundamental principles of Major NSR and NSR netting because these
principles are designed to ensure that there is no interference with
the NAAQS and control strategies.\4\ The Major NSR netting program
requires the following: (1) An identified contemporaneous period, (2)
the reductions must be contemporaneous and creditable, (3) the
reductions must be of the same pollutant as the change, (4) the
reductions must be real, (5) the reductions must be permanent, and (6)
the reductions must be quantifiable. See 40 CFR 51.165(a)(1)(vi) (the
definition of ``net emissions increase''); 40 CFR 51.166(b)(3). To be
considered creditable, the reduction's old level of emissions must
exceed the new level of emissions, the reduction must be enforceable as
a practical matter at and after the time the actual change begins, and
the reduction must have approximately the same qualitative significance
for public health and welfare as that attributed to the increase from
the particular change. See 74 FR 48450, at 48461.
---------------------------------------------------------------------------
\4\ However, our analysis of the netting provisions in the
Qualified Facilities Program under Minor NSR is not intended to
create a binding Agency position on evaluating the approvability of
Minor NSR netting.
---------------------------------------------------------------------------
As discussed below, the Program's netting provisions do not meet
all of the requirements; therefore, the Qualified Facilities netting is
disapproved as a Minor NSR netting program.
The Program fails to define a contemporaneous or other
period for the netting and that the emission reductions must occur
within that specified period. 74 FR 48450, at 48461; Section V.C.1
below.
Emissions reductions under the Qualified Facilities
program are not enforceable as a practical matter at and after the time
of the actual change begins; and therefore, not sufficiently
creditable. First, the Program fails to ensure a separate netting
analysis is performed for each proposed change because the rules are
not clear that reductions can only be relied upon once. Therefore, we
find that the Program fails to prevent double counting; and
consequently these types of reductions are not creditable. Second, the
Program does not require that each Qualified Facility involved in the
netting transaction must submit a permit application and obtain a
permit revision reflecting all of the changes made to reduce emissions
(relied upon in the netting analysis) as well as reflecting the change
itself that increased emissions. As a result, emissions reductions are
not enforceable; and therefore, not
[[Page 19474]]
sufficiently creditable. 74 FR 48450, at 48462; Section V.C.1.
EPA proposed to find that the State's ``interchange''
methodology, submitted 30 TAC 116.116(e)(3), is consistent with the
Federal requirement that reductions must be of the same pollutant as
the change.\5\ 74 FR 48450, at 48461. However, after evaluation of
received comments, EPA finds that the term ``sulfur compounds'' in 30
TAC 116.116(e)(3)(F), is broad enough to include hydrogen sulfide.
Hydrogen sulfide is a regulated NSR pollutant (see 40 CFR
52.21(b)(23)(i) and 52.21(i)(5)(i)) and, in certain instances, may
require separate analysis from sulfur oxides in a netting analysis.
Therefore, the interchange methodology may not ensure the health
impacts of all sulfur compounds will be equal. The State failed to
demonstrate that such use of hydrogen sulfide would protect the sulfur
dioxides NAAQS. Additionally, this provision allows PM-2.5 to be
interchanged with PM-10. However, because PM-10 and PM-2.5 are two
separate pollutants and the State failed to demonstrate that such use
of PM-10 would protect the PM-2.5 NAAQS, this interchange is
inappropriate. Therefore, this provision is unapprovable for the sulfur
dioxides and PM NAAQS. Section V.C.1 below.
---------------------------------------------------------------------------
\5\ See 40 CFR 51.165(a)(1)(vi)(A) and 51.166(b)(3)(i), which
define net emissions increase ``with respect to any regulated NSR
pollutant.'' Emphasis added.
---------------------------------------------------------------------------
The Program also lacks any provisions that require the
reductions to be permanent. Specifically, the submitted Program does
not include provisions that either prohibit future increases at the
Qualified Facility, or ensure that any future increase at a Qualified
Facility at which a previous netting reduction occurred is analyzed in
totality to assure that the NAAQS remains protected from the original
increase. 74 FR 48450, at 48461; Section V.C.1 below.
Section 30 TAC 116.117(b) lacks any provisions that require a
permit application to be submitted to TCEQ for a change under the
Program. There are no provisions in 30 TAC 116.117(b) that clearly
indicate that TCEQ must issue a revised permit for the changes made by
all of the participating Qualified Facilities. Thus, EPA finds that the
Program is not approvable because it lacks this requirement and
therefore is not enforceable. See 74 FR 48450, at 48462, Section V.D.1
below.
The Qualified Facilities SIP submittal is a relaxation under CAA
section 110(l) because it provides an exemption from NSR permitting not
previously available to facilities. As such, this revision creates a
risk of interference with NAAQS attainment, RFP, or any other
requirement of the Act. EPA lacks information sufficient to make a
determination that the requested SIP revision relaxation does not
interfere with any applicable requirements concerning attainment and
RFP, or any other applicable requirement of the Act, as required by
section 110(l). See 74 FR 48450, at 48463.
For the reasons discussed above in this section and as further
discussed below in Section V (Response to Comments), EPA is
disapproving the submitted Qualified Facilities Program as not meeting
section 110(a)(2)(C) and 110(l) of that Act and 40 CFR 51.160. See 74
FR 48450, at 48462.
D. Definition of ``Facility''
EPA proposed to make an administrative correction to the severable
submittal for the SIP-approved definition of ``facility'' under 30 TAC
116.10(6). Consistent with our proposal, EPA is finalizing this
administrative correction in today's action. Specifically, EPA corrects
a typographical error at 72 FR 49198 to clarify that the definition of
``facility,'' as codified at 30 TAC 116.10(6), was approved as part of
the Texas SIP in 2006 and remains part of the Texas SIP. 74 FR 48450,
at 48465.
However, EPA wishes to note that each part of the Texas NSR program
depends greatly upon the definition of ``facility'' that is applicable
to it and upon how that definition is used in context within each part
of the program. There are instances where a specific part of the Texas
NSR program does not meet the Act and EPA regulations due to the
definition of ``facility'' that applies to that part of the program.
For example Texas's PSD non-PAL rules explicitly limit the definition
of ``facility'' to ``emissions unit,'' but the NNSR non-PAL rules fail
to include such a limitation. 74 FR 48450, at 48475; compare 30 TAC
116.10(6) to 30 TAC 116.160(c)(3). TCEQ did not provide information to
demonstrate that the lack of this explicit limitation in the NNSR SIP
non-PALs revision is at least as stringent as the revised Major NSR SIP
requirements. 74 FR 48450, at 48455; Section V.M. below.
V. Response to Comments
In response to our September 23, 2009, proposal, we received
comments from the following: Sierra Club--Houston Regional Group;
Sierra Club Membership Services (including 2,062 individual comment
letters); Harris County Public Health and Environmental Services; Texas
Commission on Environmental Quality; Members of the Texas House of
Representatives; Office of the Mayor--City of Houston, Texas;
University of Texas at Austin School of Law--Environmental Clinic;
Baker Botts, L.L.P., on behalf of BCCA Appeal Group; Baker Botts,
L.L.P., on behalf of Texas Industrial Project; Bracewell & Guiliani,
L.L.P., on behalf of the Electric Reliability Coordinating Council;
Gulf Coast Lignite Coalition; Texas Chemical Council.
A. General Comments
1. Comments Generally Supporting Proposal
Comment: Harris County Public Health & Environmental Services
(HCPHES) acknowledges that EPA takes issue with the TCEQ regulations
because of the lack of specificity regarding definitions and general
lack of checks and balances to ensure that Federal requirements are met
during the State's permitting processes, and because they do not meet
the Minor NSR SIP and Major NSR SIP, including the Major NSR
Nonattainment SIP requirements. Those concerns, currently unaddressed
by the TCEQ, have ultimately resulted in EPA's proposed disapproval of
portions of the TCEQ's most recent SIP submittal. HCPHES views a TCEQ
program that meets the Federal requirements as being critical to
ensuring that air quality in the Houston Galveston Brazoria (HGB) area
returns to levels compliant with the NAAQS. HCPHES is very concerned
that the TCEQ programs fall short of Federal requirements and
encourages EPA to aggressively pursue the timely correction of these
deficiencies to ensure the health, safety, and well being of the
citizens of Harris County. HCPHES supports EPA's conclusion to
disapprove portions of the SIP as proposed until such time as TCEQ
addresses all of the specifics noted in the Federal Register.
Comment: Several members of the Texas House of Representatives
support EPA's proposed disapproval of the Qualified Facilities Program.
While the Qualified Facilities Program was a legislative creation,
these members of the Texas House recognize that the statutory language
and associated regulations are inconsistent with current CAA
requirements regarding modifications and public participation.
Particular concerns are:
Inadequate TCEQ oversight. The rules authorize many
changes at facilities without any pre-approval by TCEQ or procedures
for denial for
[[Page 19475]]
cause. These off-permit changes are difficult to track and enforce and
may threaten ambient air quality.
The lack of understandable and traceable permits. Texas
industry, regulators, and the public should be able to obtain a permit,
read it, and know what quantity of what pollutants the facility is
authorized to emit. The off-permit changes authorized through the
Qualified Facilities rules prevent such transparency.
Comment: Houston Regional Group of the Sierra Club (Sierra Club)
supports EPA's analysis and agrees that all of the September 23, 2009,
proposals (including the Qualified Facilities Program) should be
disapproved. The commenter generally supported EPA's proposed
disapproval of the Qualified Facilities Program; Flexible Permits
Program; and Texas Major and Minor NSR SIP for 1997 8-hour and 1-hour
ozone NAAQS, Prevention of Significant Deterioration (PSD) SIP, and
Standard Permit for Pollution Control Projects. The commenter provided
additional comments on our proposed disapproval of the Flexible Permits
Program, which EPA will address in its separate action on the Flexible
Permits Program.
Response: Generally, these comments support EPA's analysis of
Texas's Qualified Facilities Program as discussed in detail at 74 FR
48450, at 48455-48463, and further support EPA's action to disapprove
the Qualified Facilities submission.
Comment: The Sierra Club Membership Services (SCMS) sent numerous
similar letters via e-mail that relate to this action. These comments
include 1,789 identical letters (sent via e-mail), which included the
following comments:
The TCEQ is broken and the commenters applaud EPA's
proposed ruling that major portions of the TCEQ air permitting program
does not adhere to the CAA and should be thrown out;
While agreeing that the proposed disapprovals are a good
first step, the commenters state that EPA should take bold actions as
follows:
--Halting any new air pollution permits being issued by TCEQ utilizing
TCEQ's current illegal policy;
--Creating a moratorium on the operations of any new coal fired power
plants in Texas until TCEQ cleans up its act by operating under the
Federal CAA;
--Requiring coal companies clean up their old, dirty plants--no
exceptions, no bailouts, and no special treatment--by reviewing all
permits issued since TCEQ adopted its illegal policies and requiring
that these entities resubmit their applications in accordance with the
Federal CAA; and
--Put stronger rules in place in order to reduce global-warming
emissions and to make sure new laws and rules do not allow existing
coal plants to continue polluting with global warming emissions.
The commenters further state that Texas: (1) Has more
proposed coal and pet coke fired power plants than any other state in
the nation; (2) Is number 1 in carbon emissions; and (3) Is on the list
for the largest increase in emissions over the past five years.
The commenters do not want coal to stand in the way of a
clean energy future in Texas. Strong rules are needed to make sure the
coal industry is held responsible for their mess and that no permits
are issued under TCEQ's illegal permitting process. Strong regulations
are vital to cleaning up the energy industry and putting Texas on a
path to clean energy technology that boosts economic growth, creates
jobs in Texas, and protects the air quality, health, and communities.
In addition, SCMS sent 273 similar letters (sent via e-mail) that
contained additional comments. These additional comments include the
following:
Commenters suggest that Texas rely on wind power, solar
energy, and natural gas as clean alternatives to coal.
Other comments expressed general concerns related to:
Impacts on global warming, lack of commitment by TCEQ to protect air
quality, the need for clean energy efficient growth, impacts of upon
human health, endangerment of wildlife, impacts on creation of future
jobs in Texas, plus numerous other similar concerns.
Response: To the extent the SCMS letters comment on the proposed
disapproval of the Qualified Facility program, they support EPA's
action to disapprove the Qualified Facilities submission. The remaining
comments are outside the scope of our proposed action relating to the
Qualified Facilities Program.
Comment: The Environmental Clinic, the University of Texas at
Austin School of Law (UT Environmental Clinic) commented that EPA
should disapprove several other sections of 30 TAC Chapter 116.
Response: This final rulemaking only addresses the Qualified
Facilities Program. Therefore, issues related to other portions of
Texas's regulations are outside the scope of this rulemaking.
2. Comments Generally Opposing Proposal
Comment: TCEQ provided several general comments on the proposal.
The TCEQ commented that the Qualified Facilities Program was developed
by the 74th Texas Legislature through Senate Bill (SB) 1126, which
became effective May 19, 1995. SB 1126 amended the Texas Clean Air Act
by revising the definition of ``modification of existing facility,''
which changed the factors used to determine whether a modification for
State permitting (i.e. Minor NSR) has occurred. In 1996, 30 TAC Chapter
116 was revised to incorporate this legislative directive. These
changes provide that modifications may be made to existing facilities
without triggering the State's Minor NSR requirements whenever: (1) The
facility to be modified has received a permit, permit amendment, or has
been exempted from permitting requirements no earlier than 120 months
from when the change will occur; or (2) uses air pollution control
methods that are at least as effective as the Minor NSR SIP best
available control technology (BACT) that the Commission required 120
months before the change will occur. Such facilities are designated as
``qualified facilities.''
TCEQ has always considered the Qualified Facilities Program to be
applicable only to Minor NSR and not applicable to Major NSR, although
this is not specifically stated in the rule. In summary, under the
Qualified Facilities Program, TCEQ: (1) Determines Federal
applicability as a first step in processing a Qualified Facilities
request; and uses actual emissions, not allowable emission rates; (2)
applies Federal NSR requirements when triggered; (3) does not
circumvent Federal requirements applicable to major stationary sources
or major modifications; (4) considers the use of ``modification'' to be
separate and severable from the Federal definition of ``modification''
as reflected in the SIP-approved Major NSR Program; and (5) does not
violate the approved SIP with regard to Major NSR or Minor NSR Program
requirements.
Comment: The Texas Chemical Council (TCC) comments that it would be
short-cited to analyze the three programs (Qualified Facilities,
Flexible Permits, and NSR Reform) apart from the dramatic improvements
in the air quality in Texas in the past 15 years. TCC goes on to
describe these improvements. TCC supports full approval of Qualified
Facilities. The Qualified Facilities Program is not intended to shield
a source from major NSR. The Program is a robust, Federally enforceable
program. The Qualified
[[Page 19476]]
Facilities Program is authorized by the TCAA, promotes flexibility, and
allows sources to make certain changes without triggering NSR. If Major
NSR is triggered, a facility cannot be a Qualified Facility. The
definition of a Qualified Facility makes it clear that a Qualified
Facility is an existing facility. A Qualified Facility may make a
physical change in or change the operation of that facility as long as
the change does not result in a net increase in allowable emissions of
any air contaminant and does not result in the emission of any air
contaminant not previously emitted. Additionally, the facility must be
using equipment at least as effective as the BACT required by TCEQ. TCC
supports full approval of the three Texas air permitting program
submittals. The SIP revisions submitted to EPA by TCEQ over the last 15
years are critical components to Texas air permitting program. Texas
should not be punished for EPA's failure to act within the statutory
timeframe in the CAA. EPA offers little or no legal justification for
proposing disapproval of these programs. EPA's proposed action will
have an enormous impact on the country's largest industrial state. The
SIP revision submittals for these programs are at least as stringent as
the applicable Federal requirements and should be fully approved.
Comment: Bracewell & Giuliani LLP, counsel to the Electric
Reliability Coordinating Council (ERCC), commented that Qualified
Facilities provides incentives to implement pollution reduction
measures at existing facilities. EPA's proposed disapproval does not
provide any evidence that this authorization is actually used for major
modifications or in fact interferes with air quality improvements.
Discontinuance of this program could deter or delay many pollution
reduction measures because the cost and resources associated with a
full notice and comment case-by-case permit would outweigh the economic
benefits of the additional controls. EPA should determine that the
Qualified Facilities Program satisfies the CAA requirements for a state
minor source program and retract the SIP disapproval and approve this
SIP revision. EPA should recognize the validity of permits issued under
the Texas permitting program and refrain from taking enforcement
actions to address EPA concerns.
Comment: Jackson Walker, LLP, counsel to Gulf Coast Lignite
Coalition GCLC, provided the following general comments on all three
proposed disapprovals (Qualified Facilities, Flexible Permits, and NSR
Reform): (1) Commenters disagree with all the proposed disapprovals
because the SIP as implemented by TCEQ meets or exceeds CAA
requirements and has met the goals of the CAA; (2) EPA has a history of
focusing on results; so, EPA should look beyond immaterial differences
in the rule provisions and focus on the positive results that Texas has
achieved under the TCAA and the State's submittals; (3) Texas sources
have relied on the submitted rules for as long as 15 years in some
cases. To disapprove the submittals after so long puts too much burden
on the regulated community, creates regulatory uncertainty, hurts the
vulnerable economy by potentially increasing compliance costs, and may
discourage future business expansion; and (4) GCLC requests that EPA
work collaboratively, not combatively, with TCEQ to resolve any issues
under the CAA.
Comment: Baker Botts, LLP, counsel for Texas Industry Project (TIP)
and Business Coalition for Clean Air (BCCA) provided the following
comments. TIP and BCCA support full approval of Qualified Facilities
because the submittal will strengthen Texas's permitting program. EPA
should work expeditiously with TCEQ to approve the Qualified Facilities
Program. Further, under Texas's integrated air permitting regime, air
quality in the state is demonstrating strong, sustained improvement.
Commenters describe the air quality improvements in Texas in the recent
past. Finally, commenters describe their understanding of how the
Qualified Facilities Program operates. Qualified Facilities is a Minor
NSR applicability trigger that allows existing emissions facilities
that employ BACT to make changes without Minor NSR review as long as
the changes do not result in net emissions increases. The Qualified
Facilities Program is authorized by the TCAA and applies only to
existing facilities. The term ``facility'' is analogous to the Federal
definition of ``emissions unit,'' under Texas's Title V program. See 30
TAC 122.10(8). The Texas Legislature created the Qualified Facilities
Program as an incentive for sites to implement BACT. To be
``qualified,'' the source must (1) have a permit or permit amendment or
exempt from pre-construction permit requirements no earlier than 120
months before the change will occur, or (2) use air pollution control
methods that are at least as effective as the BACT that was required or
would have been required for the same class or type of facility by a
permit issued 120 months before the change will occur. See 30 TAC
116.116(e). A qualified facility may lose its status as ``qualified''
if its permit, exemption, or control method falls outside the 10-year
window. See Texas Nat'l Res. Conservation Comm'n, Modification of
Existing Facilities under Senate Bill 1126: Guidance for Air Quality,
(April 1996), 5 [hereinafter Modification of Existing Facilities
Guidance].
Comment: Texas Oil & Gas Association (TxOGA) is encouraged that EPA
is taking action to provide certainty in the regulatory process for
businesses. TxOGA supports the ongoing goal of improved air quality;
however, commenters do not believe that the proposed disapproval does
anything to improve air quality in Texas. Further, the proposal may
discourage future business expansion in Texas.
Response: EPA understands TCEQ's explanation of the origination of
the Program in SB 1126. Nonetheless, the Qualified Facilities Program
must meet all Federal requirements under the CAA in order to be
approvable. The fact that EPA failed to act on the Qualified Facilities
Program SIP revision within the statutory timeframe does not dictate
the action EPA must take on the Program at this time. We cannot approve
a program that fails to meet the requirements of the CAA. As discussed
throughout our proposal and this final notice, the current Qualified
Facilities Program fails to meet all requirements. We disagree with
commenters that the Qualified Facilities Program is exclusively a Minor
NSR program, based upon the ambiguities in the Program's rules.
Furthermore, EPA need not prove that the Program is actually used for
major modifications. EPA is required to review a SIP revision
submission for its compliance with the Act and EPA regulations. CAA
110(k)(3); Natural Resources Defense Council, Inc. v. Browner, 57 F.3d
1122, 1123 (DC Cir. 1995); American Cyanamid v. EPA, 810 F.2d 493, 495
(5th Cir. 1987). This includes an analysis of the submitted regulations
for their legal interpretation. The Program's rules are ambiguous and
therefore do not adequately prohibit use under Major NSR. We recognize
that TCEQ considers the Program to be a Minor NSR Program; however, the
State admits that its rules are insufficient to limit the Program to
Minor NSR. See 74 FR 48450, at 48456-48457; Section V.F. below for
further information.
EPA enforcement of Federal requirements in Texas is outside the
scope of this rulemaking. Additionally, comments on the Flexible
Permits Program and the NSR Reform submittal are outside the scope of
this notice. EPA will address the comments on its
[[Page 19477]]
proposed disapprovals of Flexible Permits and NSR Reform in separate
actions on these programs.
B. Comments That This Action Is Inconsistent With the CAA
Comment: ERCC commented that EPA's proposed disapprovals are not
rationally supported by case law and are inconsistent with the CAA.
Congress placed primary responsibility for developing SIPs on the
states, so permitting programs among states can vary greatly. EPA
determines whether the state SIP satisfies the minimum requirements of
the CAA. Union Electric Co. v. EPA, 427 U.S. 246 (1976), rehearing
denied 429 U.S. 873 (1976); Train v. NRDC, 421 U.S. 60 (1975); Florida
Power and Light Co. v. Costle, 650 F.2d 586 (5th Cir. 1979); 71 FR
48696, 486700 (August 21, 2006) (Proposed rule to promulgate a FIP
under the CAA for tribes in Indian country). The Fifth Circuit Court of
Appeals recently stated that ``EPA has no authority to question the
wisdom of a State's choice of emission limitations if they are part of
a SIP that otherwise satisfies the standards set for in 42 U.S.C.
7410(a)(2).'' Clean Coalition v. TXU Power, 536 F.3d 469 Fn.3 (5th Cir.
Tex. 2008). Texas's permitting programs are based on the recognized
Minor NSR flexibility and consistent with prior EPA approvals of other
state SIPs. EPA must review other approved state programs to ensure
that Texas's sources are not put at a competitive disadvantage. See
Memorandum from John Seitz, Director, OAQPS, SIP Consistency Process
(April 4, 10, 1996). EPA's proposed disapprovals could have dramatic
impact on industries in Texas. EPA should solicit comments from all EPA
regions on whether the proposed actions are inconsistent with other
state SIPs and compare the stringency of the Texas programs to those of
other states. ERCC is confident that EPA will realize that the Texas
programs are consistent and possibly more stringent than other
permitting programs throughout the country.
Response: EPA continues to recognize that permitting programs among
states can vary greatly and provide some flexibility for Minor NSR SIP
programs. However, in order to be approved as part of the SIP, the
Qualified Facilities Program must meet all applicable Federal
requirements. Here, the commenter's reliance on the Fifth Circuit's
dicta in Clean Coalition is misplaced because the Qualified Facilities
Program does not meet the standard set in 42 U.S.C. 7410(a)(2)(C).
Section 42 U.S.C. 7410(a)(2)(C) requires the State to have a permitting
program that complies with PSD and Nonattainment New Source Review
(NNSR) permit requirements (at 42 U.S.C. 7475 and 7503, respectively),
as well as Minor NSR permit requirements. As part of the State's
permitting program, the Qualified Facilities Program fails to meet
these requirements of the Act. As discussed throughout our proposal and
this final action, the submitted Program fails to meet all requirements
for an approvable permitting program, including submitting information
sufficient to demonstrate that the Program is restricted only to Minor
NSR. Commenters argue that the Qualified Facilities Program is
consistent with other SIP approved programs; however, they fail to cite
any specific examples.
C. Comments Addressing Whether the Qualified Facilities Rules Allow
Sources to ``Net Out'' of Major and Minor NSR Through Rules That Are
Not Adequate To Protect the NAAQS and State Control Strategies
1. Comments Generally Supporting Proposal
Comment: UT Environmental Clinic commented that the Qualified
Facilities Program fails to meet the netting requirements for several
reasons. The commenter notes that the Qualified Facilities Program
netting calculations can be based on allowable emissions. Allowables
netting violates Major NSR because it is inconsistent with State of New
York v. EPA, 413 F.3d 3, 40 (DC Cir. 2005) and violates the CAA; it
violates Minor NSR because it fails to require an evaluation of the
actual emissions impacts on maintenance of the NAAQS.
Response: Generally, these comments support EPA's analysis of
Texas's Qualified Facilities Program as a substitute for a Major NSR
SIP program as discussed in detail at 74 FR 48450, at 48459, and
further support EPA's action to disapprove the Qualified Facilities
submission.
We find that the Program authorizes existing allowable, rather than
actual emissions, to be used as a baseline to determine applicability.
This use of allowables violates the Act for Major NSR SIP requirements
and is contrary to New York v. EPA, 413 F.3d 3, 38-40 (DC Cir. 2005)
(``New York I''). 74 FR 48450, at 48459. Under the submitted Program,
the project's increases in emissions are calculated based upon its
projected allowable emissions. The baseline uses the permitted
allowable emission rate (lowered by any applicable state or Federal
requirement) if the facility ``qualified'' under 30 TAC
116.10(11)(E)(i). If the facility ``qualified'' under 30 TAC
116.10(11)(E)(ii), the baseline uses the actual emission rate (minus
any applicable state or Federal requirement). In the applicability
netting analysis, the baseline for all the other participating minor
and major existing Qualified Facilities is calculated in the same way.
The emission reductions are calculated similarly, i.e., reductions
beyond the permitted allowable or actual emission rates (minus the
applicable state and Federal requirements). Thus, this submitted
Program allows an evaluation using allowable, not actual emissions, as
the baseline to calculate the project's proposed emission increase and
for many of the netting emission reductions, thereby in many cases
possibly circumventing the major modification applicability
requirements under the Major NSR rules. Therefore, the Program fails to
meet the CAA and Major NSR requirements to use baseline actual
emissions for major source netting as the starting point from which the
amount of creditable emission increases or decreases is determined. 74
FR 48450, at 48459.
EPA agrees that the reductions in the Program's netting are not
based on actual emissions. Such netting may be permissible for a Minor
NSR Program; provided that the netting provisions assure protection of
the NAAQS and the SIP control strategies as required by section
110(a)(2)(C) of the CAA. Allowables netting is acceptable because CAA
section 110(a)(2)(c) does not explicitly prohibit the use of allowables
netting for Minor NSR programs. However, Texas failed to submit
sufficient information to demonstrate that the use of allowable
emissions in a Minor NSR netting program continues to protect the NAAQS
and control strategies; therefore, EPA cannot determine if this
requirement is met. Today's rulemaking disapproves netting under the
Qualified Facilities Program as a Minor NSR program, in part because
the Program fails to ensure that ambient air is protected in
consideration of all changes in the netting.
Comment: UT Environmental Clinic commented that the definitions in
section 116.10 do not adequately specify how to calculate emissions
reductions for purposes of the netting analysis. For example, the Texas
definition of actual emissions is the ``highest rate'' actually
achieved within the past 10 years. It is unclear whether this is the
highest emission rate achieved at a single point in time or averaged
over some period.
Response: We disagree that the reductions are not quantifiable. The
[[Page 19478]]
netting is based on the most stringent of the permitted emissions rate
(which includes the highest achievable actual emission rate) or any
applicable state or Federal rule. Nothing in the State's definition of
``actual emissions'' implies at all that there is any averaging
involved in the calculations. The reduction is based upon the highest
rate the facility achieved at a single point in time, looking back the
past 10 years.
While we proposed to find that the reductions were quantifiable, we
requested comments on two aspects of the Program as it relates to this
principle. 74 FR 48450, at 48461-48462. First, we requested comment on
whether the regulatory provisions at 30 TAC 116.10(1) and (2) provide
clear direction on the appropriate calculation procedures sufficient to
ensure the reductions are quantifiable. As stated above, we disagree
with the commenter's argument that the definitions in section 116.10 do
not adequately specify how to calculate emissions reductions for
purposes of the netting analysis.
Second, the submitted rules provide that a Qualified Facility nets
its emissions increase on the same basis as its allowable emissions
limitation. 30 TAC 116.116(e)(3)(A). We requested comment on whether
netting on such a basis is sufficiently quantifiable, and whether any
additional provisions are necessary to ensure that the entire emissions
increase is properly netted against reductions from the other Qualified
Facility. We did not receive any comments on this second aspect of
quantifiability under the Program. Because no comments were submitted
showing the basis was not sufficiently quantifiable, we continue to
believe that netting for a Minor NSR SIP program on the adequacy of the
Program's netting of emissions increases on the same basis as its
allowable emissions limitation, is sufficiently quantifiable.
Comment: UT Environmental Clinic commented that the Qualified
Facilities rules allow all emission reductions at the same account
number to be considered in the net emission calculation. In fact, the
rules could be read to allow the ``offsetting'' of emissions above
allowables by decreases in emissions at any ``different facility.'' 30
TAC 116.110(3). Because an account number can include multiple sources,
the Texas rules allow consideration of emission decreases from outside
the major stationary source in violation of 42 U.S.C. 7411(a).
Response: Generally, these comments support EPA's analysis of
Texas's Qualified Facilities Program as a substitute for a Major NSR
SIP program as discussed in detail at 74 FR 48450, at 48458-48459, and
further support EPA's action to disapprove the Qualified Facilities
submission.
We find the Program is deficient for Major NSR netting because it
may allow an emission increase to net out by taking into account
emission decreases outside of the major stationary source \6\ and, in
other circumstances, allow an evaluation of emissions of a subset of
units at a major stationary source.\7\ The State failed to submit
information sufficient to demonstrate that the Program includes the
necessary replicability and accountability to prevent such
circumvention. Therefore, the Program does not meet the CAA's
definition of ``modification'' and the Major NSR SIP requirements and
is inconsistent with Alabama Power v. Costle, 636 F.2d 323, 401-403 (DC
Cir. 1980) and Asarco v. EPA, 578 F.2d 320 (DC Cir. 1978). 74 FR 48450,
at 48458-48459.
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\6\ The Texas SIP defines an ``account'' to include an entire
company site, which could include more than one plant and certainly
more than one major stationary source. SIP rule 30 TAC 101.1(1),
second sentence.
\7\ Under the submitted Program, not all emission points, units,
facilities, major stationary sources, or minor modifications at the
site or their increases in emissions are required to be evaluated in
the applicability netting analysis. So the Program fails to require
the evaluation of emissions changes at the entire major stationary
source correctly as required by the Major NSR SIP regulations. 74 FR
48459.
---------------------------------------------------------------------------
Comment: UT Environmental Clinic commented that the Qualified
Facilities netting rules only allow consideration of the increase in
allowable emissions from the Qualified Facility undergoing a change,
but consider the decreases from any other Qualified Facilities at the
same account number. There is no consideration of all the emission
increases so there is no adequate impacts analysis from the source.
Response: Generally, these comments support EPA's analysis of
Texas's Qualified Facilities Program as a substitute for a Major NSR
SIP program as discussed in detail at 74 FR 48450, at 48458-48459, and
further support EPA's action to disapprove the Qualified Facilities
submission.
Major NSR netting is based upon all contemporaneous increases and
decreases at the same major stationary source that occur within a
reasonable period that the states must define in their approved SIPs.
The submitted Program's netting is not based upon all contemporaneous
increases at the same major stationary source and not all decreases at
the same major stationary source. However, the State contends that the
Program is not intended to apply for Major NSR netting but only for
Minor NSR netting. Moreover, the Program is not intended to allow
contemporaneous netting. Instead, one looks to the increases from the
proposed change and to decreases made at the same time as the proposed
change. Such an approach, if fully delineated in the State's Program
rules, would satisfy the minimum requirements for an approvable Minor
NSR netting program provided that the ambient air is protected in
consideration of all changes in the netting. Today's rulemaking
disapproves netting under the Qualified Facilities Program as a Minor
NSR program, in part because the Program fails to ensure that ambient
air is protected.
Comment: UT Environmental Clinic commented that the Qualified
Facilities rules do not define a contemporaneous period nor require
that emission reductions occur within a specified period. EPA notes in
the Federal Register that Texas intended that any relied-upon
reductions occur simultaneously with the increase. However, the
commenter argues that nothing in the rule requires this.
Response: We agree with the comment insofar as it asserts that the
Program fails to define a contemporaneous period or require that
emission reductions occur within a specified period. EPA finds that,
while Texas intended that any relied-upon reductions occur
simultaneously at the time of the increase,\8\ the Program is deficient
because it does not expressly define the applicable period in which the
reductions must occur. See our response to the previous comment. 74 FR
48450, at 48461.
---------------------------------------------------------------------------
\8\ See 21 Tex. Reg. 1573 (February 27, 1996).
---------------------------------------------------------------------------
Comment: UT Environmental Clinic commented that because the
Qualified Facilities rules allow reductions to be based upon allowable
emissions, they do not ensure that reductions are real.
Response: We disagree that just because the reductions are based
upon allowable emissions, these reductions are not real. For example,
reviewing authority may presume that source-specific allowable
emissions may be equivalent to the actual emissions. See 40 CFR
51.165(a)(1)(xii)(C) and 51.166(b)(21)(iii). The commenter fails to
discuss why the use of allowable emissions makes the reductions not
real.
Comment: The UT Environmental Clinic commented that the rules fail
to ensure that netted reductions are permanent.
Response: We agree with the commenter that the Program lacks any
provisions that require that the
[[Page 19479]]
reductions are permanent. For reductions to meet the netting
requirement to be permanent, the rules must include a prohibition
against future increases at the Qualified Facility, or include
regulatory language that assures that any future increase at a
Qualified Facility at which a previous netting reduction occurred is
analyzed in totality to assure that the NAAQS remains protected from
the original increase. However, the submitted Program does not include
such provisions. Consequently, the Qualified Facilities rules are
inadequate because they fail to ensure that the reductions are
permanent.
Comment: UT Environmental Clinic commented that the rules do not
prevent double counting of emission reductions.
Response: For an additional separate project, it appears that the
state intended that the reductions must occur at the time of that
additional project that will need to obtain additional reductions to
net out. If the regulatory text was consistent with this approach, this
limitation would prevent double counting of the netting reductions. The
State's intent is that the holder of the permit is required to perform
a new, separate netting analysis and rely upon reductions not relied
upon in the first netting analysis. See 74 FR 48450, at 48461 (citing
21 Tex. Reg. 1573 (February 27, 1996); page 154 of the 1996 SIP
revision submittal). We agree that the rules are not clear that a
subsequent change at a Qualified Facility that previously relied upon
netting must conduct a separate netting analysis that relies upon
reductions that were not relied upon in the first netting analysis. EPA
cannot find any provisions in the Program to ensure a separate netting
analysis performed for each proposed change. Therefore, the Program
fails to prevent double counting; and consequently these types of
netting reductions are not enforceable as a practical matter at and
after the time of the actual change begins; and therefore, not
sufficiently creditable. 74 FR 48450, at 48461.
Comment: UT Environmental Clinic commented that the Qualified
Facilities rules fail to ensure that the emission reductions are
enforceable. Facilities provide notice of changes to Qualified
Facilities on Form PI-E, which is not enforceable, and Qualified
Facility changes that affect permitted facilities are not required to
be incorporated into a permit until renewal or amendment. TCEQ noted in
its Qualified Facility guidance that the form is not Federally
enforceable ``but is simply a form to provide information to
demonstrate that the change meets qualified facility flexibility.''
Consequently, Qualified Facility reductions are allowed to remain
unenforceable for years. Further, Texas rules make it unclear whether
emission reductions are ever made enforceable because a portion of the
definition of ``allowable emissions'' states that ``[t]he allowable
emissions for a qualified facility shall not be adjusted by the
voluntary installation of controls.'' 30 TAC 116.10(2)(F). This portion
of the definition of ``allowable emissions'' states that ``[t]he
allowable emissions for a qualified facility shall not be adjusted by
the voluntary installation of controls.'' Additionally, there are no
monitoring requirements in the Qualified Facilities rules to track
compliance with commitments to reduce emissions of limitations on
emissions increases.
Response: We agree that the Qualified Facilities rules fail to
ensure that the emission reductions relied upon in a netting analysis
are enforceable. We noted at 74 FR 48450, at 48462 that the rules do
not require permits for these relied-upon reductions. We also agree
that the Program does not require monitoring because no permit is
required for each change. See Section V.D.1 below.
We disagree that 30 TAC 116.10(2)(F) makes the rules vague as to
enforceability. This provision of the rule is defining how to calculate
the baseline from which reductions occur. When calculating the
allowable emissions for a Qualified Facility participating in the
Program, one cannot count any reductions occurring as a result of the
voluntary installation of controls. However, a facility can become
``qualified'' to use the Program by voluntarily installing controls.
The reductions achieved by this voluntary installation of controls are
not counted in the Qualified Facility's allowable emissions.
Comment: UT Environmental Clinic states that the Qualified
Facilities rules do not ensure that emission reductions have the same
health and welfare effects as the emission increase. Because the
program allows the emission increase to be offset inside and outside
the facility, it allows for emission increases close to the fence line,
potentially affecting health and welfare of the surrounding community.
Moreover, the Qualified Facilities Program allows Qualified
Facilities to offset emissions increases of one pollutant with emission
decreases of another pollutant, as long as the pollutants are in the
same ``air contaminant category.'' The interchange methodology
established by TCEQ \9\ to ensure that compounds within the VOCs air
contaminant category, as interchanged, will have an equivalent impact
on air quality, is not included in the Texas rules or statute. The rule
merely defines an ``air contaminant category'' as a group of related
compounds, such as volatile organic compounds, particulate matter,
nitrogen oxides, and sulfur compounds. 30 TAC 116.116(e)(3)(F). Clearly
emissions of all sulfur compounds, say sulfur dioxide and hydrogen
sulfide, are not equal in terms of health impacts. Likewise, the health
impacts of fine PM emissions are of significantly greater concern than
the impacts of larger particles.
---------------------------------------------------------------------------
\9\ See 74 FR 48455, n.3.
---------------------------------------------------------------------------
Response: With regard to VOCs and nitrogen oxides, EPA disagrees
with the comment above that the Program is deficient because the
State's rules allow an offset of an emission increase pollutant with
emission decrease of another pollutant, as long as the pollutants are
in the same ``air contaminant category.'' The State's interchange
methodology goes beyond the fundamental principle to determine whether
the interchange of different compounds within the same air contaminant
category will result in an equivalent decrease in emissions; e.g., one
VOC for another VOC; for VOCs and nitrogen oxides. See 74 FR 48450, at
48461.
On the other hand, the term ``sulfur compounds'' in 30 TAC
116.116(e)(3)(F), is broad enough to include hydrogen sulfide. The
State failed to demonstrate that use of hydrogen sulfide would protect
the sulfur dioxides NAAQS. Therefore, we agree with the commenter that
the interchange methodology does not ensure the health impacts of all
sulfur compounds will be equal. With regard to the comment concerning
particulate matter, the definition of ``air contaminant category''
allows PM-2.5 to be interchanged with PM-10. However, because PM-10 and
PM-2.5 are two separate pollutants and the State failed to demonstrate
that such use of PM-10 would protect the PM-2.5 NAAQS, this interchange
is inappropriate. Therefore, we agree that the interchange methodology
does not ensure the health impacts of all particulate matter will be
equal.
We, however, disagree with the comment above that the Program fails
to ensure that emission reductions have the same health and welfare
effects as the emission increases. The State has established a
methodology to use whenever there is a different location of emissions
because of the intraplant
[[Page 19480]]
trading. For example, where the netting has the effect of moving
emissions closer to the plant property line than the Qualified Facility
to be changed, the State uses this methodology to analyze whether there
could be an increase in off-site impacts. See 30 TAC 116.117(b)(5). We
continue to believe that this will ensure the reductions have
approximately the same qualitative significance for public health and
welfare, which is required to ensure the reductions are creditable.
Nevertheless, as stated above, we are disapproving the Qualified
Facilities netting program as a substitute for a Major NSR SIP program
and as a Minor NSR SIP program because the Program is inadequate to
protect ambient air quality.
Comment: The UT Environmental Clinic commented that the Qualified
Facilities netting Program does not adequately protect air quality
under Minor NSR. Specifically, the Qualified Facilities netting
provisions do not meet Federal netting standards, which are in place
precisely to ensure that air quality is protected. The Program's
failure to meet almost all of those basic netting requirements renders
the rules inadequate.
Response: Generally, these comments support EPA's analysis of
Texas's Qualified Facilities Program as a Minor NSR SIP program as
discussed in detail at 74 FR 48450, at 48460-48462, and further support
EPA's action to disapprove the Qualified Facilities submission.
Comment: The UT Environmental Clinic commented that the Program is
clearly inadequate to ensure protection of the NAAQS and to prevent
violations of control strategies. The rules cannot be approved as an
exemption from Minor NSR permitting because they in no way ensure that
the emission increases authorized pursuant to the rules will have a de
minimis impact on air quality.
Response: We agree with the commenter that the Program is
inadequate to ensure protection of the NAAQS for several reasons. As
discussed below in Section V.G.1, we find that the Qualified Facilities
rules are not clear that all Qualified Facilities must have obtained a
Texas NSR SIP permit. Without the assurance that all Qualified
Facilities have obtained a Texas NSR SIP permit, EPA cannot make the
finding that each permit for a Qualified Facility includes an emission
limitation based on the chosen control technology, with a determination
that the Qualified Facility will not interfere with attainment and
maintenance of the NAAQS or violate any control strategy. Therefore,
the Program fails to ensure that all Qualified Facilities can operate
up to a permitted allowable limit such that they do not interfere with
attainment and maintenance of the NAAQS and do not violate any State
control strategy, as required by the Texas NSR SIP.
Additionally, the Program fails to ensure that the NAAQS are
protected because 30 TAC 116.117 lacks language requiring the owner or
operator to maintain the information and analysis showing how it
concluded that there will be no adverse impact on ambient air quality
before undertaking the change.
We agree with the commenter that the Program does not qualify as a
de minimis exemption from Minor NSR. The State has not provided
sufficient information to demonstrate that the exempted changes from
the Minor NSR requirements will have only a de minimis effect. See
Section V.D.1 below for more information.
2. Comments Generally Opposing Proposal
Comment: TCEQ commented that the Qualified Facilities Program can
only be used if a physical or operational change complies with Federal
NSR requirements. In order to make a physical or operational change to
a Qualified Facility, an owner or operator must demonstrate that the
change does not result in a net increase in allowable emissions of any
air contaminant previously authorized under state minor source review.
30 TAC 116.116(e)(1). Keeping in mind the State definition of
``facility,'' 30 TAC 116.116(e)(2) and (3) allow a Qualified Facility
to demonstrate that a state modification has not occurred by comparing
allowable emissions to allowable emissions before and after a proposed
change. Allowable emissions (both hourly and annual rates) are one of
the criteria to provide ``state qualified'' flexibility because the
facilities must exist and be authorized, and thereby have undergone
appropriate permit review. In addition, no existing level of control
can be reduced. 30 TAC 116.116(e)(8). The commenter states that for
major sources, in addition to State requirements, the evaluation of
emissions related to physical and/or operational changes is conducted
on a baseline actual to either a projected actual or potential to emit
base if applicable. 30 TAC 116.116(e)(4). This comparison is used to
determine if an emission increase above the appropriate significance
threshold for a particular Federal permitting program has occurred.
From the Federal NSR standpoint, if a proposed physical or operational
change would result in an emissions increase that exceeds a
significance threshold, the appropriate analysis (netting) is
triggered. If the results of the netting analysis indicate that a major
modification has occurred, the appropriate Federal program(s) is
triggered and Federal authorization must be obtained. In such a case,
the Qualified Facilities Program would not be an applicable
authorization pathway, and a State Minor NSR amendment must be
obtained, along with the appropriate Federal NSR authorization. The
exemption from the definition of ``modification of an existing
facility'' under the Qualified Facilities Program does not relieve an
owner or operator from conducting an evaluation to determine if a
Federal major modification has occurred. TCEQ states that from the
Federal standpoint, only the project's emission increases are evaluated
(without consideration of emission decreases) to determine if a Federal
applicability analysis (netting) has been triggered. If the project
increases equal or exceed the netting threshold for the pollutant and
this program, then a full contemporaneous netting exercise is conducted
in an effort to determine if the modification is a major modification.
If the project is a major modification, then the appropriate Federal
NSR program, either PSD or nonattainment review, is triggered. A permit
holder cannot use the ``no net emissions increase'' concept that is
described in the Qualified Facilities Program rules as a mechanism to
avoid a Federal NSR applicability analysis (netting).
Comment: TxOGA commented that the Qualified Facilities Program
establishes an allowables-based trigger and has no effect on a permit
holder's compliance obligations under Federal requirements. Texas rules
clearly require compliance with Federal requirements. 30 TAC
116.117(a)(4) and (d). This interpretation is also supported by TCEQ
guidance.
Comment: The TCC commented in response to EPA's assertion that a
Major NSR applicability determination must be based on actual
emissions, not allowables. TCC argues that the Qualified Facilities
rules do not circumvent any Federal requirements for major stationary
sources. TCC reiterates that a qualified facility must demonstrate that
the change does not result in a net increase in allowables, the source
must follow notification requirements, and the source cannot relax
controls at the qualified facility.
Response: We acknowledge TCEQ's description of how the State
intends to implement the Qualified Facilities Program; however, we have
determined
[[Page 19481]]
that TCEQ's current rules are insufficient to prevent circumvention of
Major NSR. EPA disagrees with the comments from TxOGA and TCC. The
submitted Program lacks specific requirements that would require an
owner or operator who proposes a change under the Qualified Facilities
program to first conduct a Major NSR applicability analysis (netting)
prior to receiving (or asserting) authorization under the Qualified
Facilities Program.
Comment: TCEQ commented that for facilities undergoing an
intraplant trade, where the allowable emissions at one facility are
increased while allowable emissions at another facility are reduced an
allowable-to-allowable comparison is used only to determine if a new
emissions increase has occurred for State purposes. The emissions are
reviewed simultaneously, which is more stringent than the Federal
requirement that only requires contemporaneous emissions. If a net
emissions increase has occurred, an owner or operator cannot use the
Qualified Facilities Program to authorize the proposed project, and
must find another State mechanism to obtain proper authorization. In
addition, the commenter states that the owner or operator must submit
pre-change notification if the intraplant trade moves emissions from
the interior of a plant site closer to a property line. This gives TCEQ
staff the ability to evaluate public protectiveness and evaluate any
potential changes in off property impacts as they relate to all
contaminants and pollutants with national standards, i.e. the NAAQS.
This intraplant trade capability only exists to the extent that the
project is a Minor NSR action, and does not apply if a major
modification has been triggered under Federal NSR requirements.
Response: EPA disagrees with the commenter that under the Texas
rules the Program's intraplant trading does not apply if a major
modification has been triggered. As stated above, the program fails to
require a Major NSR applicability analysis and is insufficient to
prevent circumvention of Major NSR. Intraplant trading based on
allowables to allowables netting is prohibited under Major NSR. See
State of New York et al., v. EPA, 413 F.3d 3, 40 (DC Cir. 2005).
However, such netting may be permissible for a Minor NSR program,
provided that the netting provisions assure protection of the NAAQS.
See 74 FR 48450, at 48462. As discussed above, Texas's Qualified
Facilities Program does not meet this requirement. EPA also finds that
the Program does not adequately define a contemporaneous (or
simultaneous) period or require that emission reductions occur within a
specified period. As discussed above, we find that the Program fails to
meet the Minor NSR netting requirement for a defined period in which
the reductions must occur.
Comment: TIP and BCCA commented that the Qualified Facilities
program exceeds Federal benchmarks for allowable-based Minor NSR
triggers. This program is one of the mechanisms that EPA encouraged in
its Flexible Air Permitting Rule (FAP) (74 FR 51418, 15423). Further,
the program is more stringent than the Federal FAP Program because it
requires up-to-date BACT. The Qualified Facilities Program is also
comparable to the proposed allowables-based minor NSR trigger in EPA's
proposed Indian Country rule, in which EPA allows the use of allowables
to allowables netting. To justify the use of an allowables test, EPA
distinguished the definition of ``modification'' under Minor NSR from
that used for Major NSR. 71 FR 48696, 48701 (citing State of New York,
et al., v. EPA (DC Cir. Jun. 24, 2005)). The Qualified Facilities rules
meet these criteria and are more stringent than the Federal model
because it only extends this flexibility to well-controlled facilities.
The commenter reiterates that the Qualified Facilities Program does
not effect a permit holder's obligation to comply with Federal
requirements. An allowables-based trigger is permissible because the
CAA and Federal regulations do not mandate a method for determining
minor NSR. The Environmental Appeals Board confirmed that there is no
mandated methodology for the emissions test used for minor NSR. In re
Tennessee Valley Authority, 9 EAD 357, 461 (EAB September 15, 2000).
Again, EPA employed an allowables-to-allowables test in its proposed
Indian Country rule. States have great flexibility to determine
applicability for Minor NSR and that includes the authority to use an
allowables-based trigger. TCEQ rules articulate an overriding
obligation to comply with Federal requirements. 30 TAC 116.117(a)(4)
and (d). Therefore, the current Qualified Facilities rules prevent
circumvention of Major NSR.
Response: EPA disagrees with the commenter. This rulemaking
disapproves netting under the Qualified Facilities Program for Major
NSR, in part because the Program fails to first require a Major NSR
applicability demonstration to show that a proposed change does not
trigger Major NSR before the source can take advantage of the Program.
In contrast to the Qualified Facilities Program, under the proposed
Indian Country rule, 40 CFR 49.153 would explicitly require the
proposed new source or modification to determine applicability to Major
NSR before taking advantage of the program. The source could only use
allowables netting under the proposed Indian County rule after a Major
NSR applicability determination. See 71 FR 48696, at 48705, 48728-
48729. The Qualified Facilities rules are deficient because they lack
such a requirement. Further, as described above, the Program fails to
meet several other netting requirements for an approvable Minor NSR
netting program.
EPA's FAP rule is an Operating permit under Title V, not Title I.
74 FR 51418, 51419. While the FAP rule recognizes the use of advance
approval programs under Minor NSR, the use of such programs must ensure
environmental protection and compliance with applicable laws. ``[FAPs]
cannot circumvent, modify, or contravene any applicable requirement
and, instead, by their design must assure compliance with each one as
it would become applicable to any authorized changes.'' See 74 FR
51418, 51422. Further, advance approval under the FAP must be made at
the time of permit issuance, and consider the alternate operating
scenarios for air quality impacts, control technology, compliances with
applicable requirements, etc. Under Major and Minor NSR, advance
approval must ensure compliance with control strategy and non-
interference with attainment and maintenance of NAAQS for each
operating scenario as required by 40 CFR 51.160. We do not see how the
Texas Qualified Facility Rule meets these requirements.
D. Comments Addressing Whether the Qualified Facilities Rules Are
Practically Enforceable
1. Comments Generally Supporting Proposal
Comment: The UT Environmental Clinic commented that the rules fail
to ensure that netted reductions are enforceable.
Response: We agree with the commenter that the Program is
unenforceable because it fails to explicitly require that a permit
application must be submitted for the change and for any relied-upon
emissions reductions in the netting analysis. Because the Program is an
exemption from a preconstruction permit, and does not require a permit,
the Program must qualify as a de minimis exemption to be approvable. We
find that the Program does not
[[Page 19482]]
qualify as a de minimis exemption from Minor NSR. The legal test for
whether a de minimis threshold can be approved is whether it is
consistent with the need for a plan to include legally enforceable
procedures to ensure that the State will not permit a source that will
violate the control strategy or interfere with NAAQS attainment, as
required by 40 CFR 51.160(a)-b). 74 FR 48450, at 48460. The State
failed to demonstrate that this exemption will not permit changes that
will violate the Texas control strategies or interfere with NAAQS
attainment. Therefore all of the requirements under 40 CFR 51.160(a)-
(b) apply to the Program.
Additionally, the Program allows too long of a lag time before a
revised permit is issued in certain circumstances that can lead to a
violation of a NAAQS, RFP, or control strategy without the TCEQ
becoming aware of it in a timely manner. We proposed that the lag time
for reporting a change under the Program should be no longer than six
months, rather than a year, but we requested comment on whether six
months is an acceptable lapse of time to ensure noninterference with
the NAAQS and control strategies. 74 FR 48450, at 48462. We received no
comments on this issue except that TCEQ stated they will consider this
change during rulemaking. Therefore, we find that the Program allows
too long of a lag time before reporting ``qualified'' changes.
Comment: The UT Environmental Clinic commented that the Program is
clearly inadequate to ensure protection of the NAAQS and PSD increments
and to prevent violations of control strategies.
Response: EPA agrees a Minor NSR SIP must include legally
enforceable procedures enabling the State to determine whether
construction or modification would violate a control strategy or
interfere with attainment or maintenance of the NAAQS. 40 CFR
51.160(a)-(b). Furthermore, any Minor NSR SIP revision submittal that
is a SIP relaxation, such as this Qualified Facilities Program, must
meet section 110(l). The Qualified Facilities SIP submittal is a
relaxation under CAA section 110(l) because it provides an exemption
from NSR permitting not previously available to sources. This SIP
relaxation creates a risk of interference with NAAQS attainment, RFP,
or any other requirement of the Act. EPA lacks sufficient available
information to determine that this SIP relaxation would not interfere
with any applicable requirement concerning attainment and RFP, or any
other requirement of the Act. See 74 FR 48450, at 48463.
2. Comments Generally Opposing Proposal
Comment: ERCC commented that the Qualified Facilities Program is
enforceable for several reasons. The program's regulations include
enforceable registration and recordkeeping requirements. Documentation
must be maintained for all Qualified Facility changes that describes
the change and demonstrates compliance with the Qualified Facility
Program as well as state and Federal law. See 30 TAC 116.117(a). TCEQ
regulations also require that, at a minimum, an annual submission is
made to the agency documenting any qualified facility changes not
incorporated into a facility permit. See 30 TAC 116.117(b). Pre-change
qualification and approval are required for certain changes including:
changes that affect BACT or where MAERT is not available (30 TAC
116.118); certain intraplant trading (30 TAC 116.117(4)); or if the
change will affect compliance with a permit condition (30 TAC
116.117(3)). EPA's general comments questioning the proper permit
application or registration for qualified facility authorization are
unclear given the minor source nature of the program and its function
as an exemption from a preconstruction permit. See 74 FR 48450, at
48462. The Program adequately imposes recordkeeping, reporting,
notification and approval regulations to satisfy the minor NSR
enforceability requirements.
Comment: TIP and BCCA also commented in response to EPA's argument
that the Qualified Facilities Program is not enforceable because
changes are not reflected in a permit. The program is a minor NSR
triggering program. Instead of permit revision, a facility qualified to
invoke the program must notify TCEQ of changes under the Qualified
Facilities rules. 30 TAC 116.118. The commenters explain the scenarios
when notification is required and the requirements for effective
notification under the rules. Commenters also state that if a change
implicates a permit special condition, the permit holder must revise
its permit special condition using the procedures specified in Chapter
116, New Source Review. 30 TAC 116.116(b)(3).
Comment: The TxOGA commented that the Qualified Facilities Program
is a minor NSR triggering provision that requires facilities to retain
documentation and notify TCEQ of changes under the program. A facility
must be qualified at the time the change is to occur. The program is
enforceable because the rules contain notification and recordkeeping
requirements.
Response: EPA disagrees with the commenters. The Program does not
meet the Federal requirements for practical enforceability. To be
approvable, a Minor NSR program must include enforceable emissions
limits. See 74 FR 48450, at 48462. The Program is not clear that each
Qualified Facility involved in the netting transaction must submit a
permit application and obtain a permit revision reflecting all of the
changes made to reduce emissions (relied upon in the netting analysis)
as well as reflecting the change itself that increased emissions. See
74 FR 48450, at 48462. Therefore, the Program is unenforceable.
Additionally, the Program allows too long of a lag time before a
revised permit is issued in certain circumstances that can lead to a
violation of a NAAQS, RFP, or control strategy without the TCEQ
becoming aware of it in a timely manner. Because the Program is an
exemption from a preconstruction permit, and does not require a permit,
the Program must qualify as a de minimis exemption to be approvable. We
find that the Program does not qualify as an approvable de minimis
exemption from Minor NSR. See 74 FR 48450, at 48462; Section V.D.1.
above. Therefore all of the requirements under 40 CFR 51.160(a)-(b)
apply to the Program. As described throughout this notice, the
Qualified Facilities Program fails to meet all of these requirements.
See 74 FR 48450, at 48460. As stated above, the Program fails to
require a permit that reflects all of the changes that occurred in the
netting process and provides enforceable emissions limits. The
notification and recordkeeping requirements, while beneficial, are not
sufficient under Federal requirements to ensure enforceability.
E. Comments Addressing Whether the Qualified Facilities Rules Meet
Federal Requirements for Major New Source Review
1. Comments Generally Supporting Proposal
Comment: The UT Environmental Clinic comments that nothing in the
Qualified Facility statute or rules limits applicability to minor
modifications. The rules require documentation at the plant site
sufficient to comply with Nonattainment NSR and PSD, but do not clarify
that changes that constitute a major modification cannot be made
through a Qualified Facility change.
The commenter further stated that because the Qualified Facilities
rules can be used to authorize major
[[Page 19483]]
modifications, the rules fail to meet the substantive requirements of
Nonattainment NSR and PSD. For emission increases associated with PSD,
the Qualified Facilities rules fail to require: (1) Best Available
Control Technology; (2) an air quality analysis of impacts on the NAAQS
and PSD increments; and (3) additional impact analysis associated with
the implementation of the new source or modification. For emission
increases associated with Nonattainment NSR, the Qualified Facilities
rules fail to require: (1) Lowest Achievable Emission Rate; (2)
emission offsets; and (3) demonstration of compliance by other
facilities in the State.
Response: These comments are consistent with EPA's analysis
concluding that Texas's Qualified Facilities Program does not meet
Major NSR Substantive requirements as discussed at 74 FR 48450, at
48458-48459.
EPA agrees that the Program is deficient because it lacks
provisions that require a Major NSR applicability determination for a
change at a Qualified Facility before it is exempted from the
permitting requirements. The Program's regulations do not contain any
emission limitations, applicability statement, or regulatory provision
restricting the change to Minor NSR. This lack of such express
provisions distinguishes the Qualified Facilities Program from the
Texas Minor NSR SIP rules for Permits by Rule in Chapter 106 and
Standard Permits in Chapter 116, Subchapter F. The Standard Permits
rules require a Major NSR applicability determination at 30 TAC
116.610(b), and prohibit circumvention of Major NSR at 30 TAC
116.610(c). Likewise, the Permits by Rule provisions require a Major
NSR applicability determination at 30 TAC 106.4(a)(3), and prohibit
circumvention of Major NSR at 30 TAC 106.4(b). The absence of these
provisions in the Qualified Facilities rules creates an unacceptable
ambiguity in the SIP. Therefore, the Program could allow circumvention
of Major NSR. See 74 FR 48450, at 48456-48458.
EPA also agrees that the Program fails to address the required air
quality impacts analysis. The comments concerning BACT, LAER, emissions
offsets and a demonstration of compliance by other facilities in the
State go beyond EPA's analysis in the proposal and are outside the
scope of this rulemaking.
Additionally, section 110(l) of the Act prohibits EPA from
approving any revision of a SIP if the revision would interfere with
any requirement concerning attainment and RFP, or any other requirement
of the Act. There is not sufficient available information to enable EPA
to determine that the submitted Program would not interfere with any
requirement concerning attainment and RFP, or any other requirement of
the Act. See 74 FR 48450, at 48459; and response above.
Comment: The Office of the Mayor, City of Houston, Texas,
recognizes that the Qualified Facilities Program has no regulatory
provisions that clearly prevent the Program from circumventing Major
NSR SIP requirements thereby allowing changes at existing facilities to
avoid the requirement to obtain preconstruction authorizations.
Therefore, major sources of emissions are making major modifications to
their facilities without going through the permitting process. The
commenter states that this is a fatal flaw in the program, it is
inconsistent with the CAA and should not be included in the SIP.
Response: The comments by the Office of the Mayor, City of Houston,
Texas, are consistent with EPA's conclusions as discussed at 74 FR
48450, at 48456-48457 and response above.
2. Comments Generally Opposing Proposal
Comment: The TCC comments that Qualified Facilities is a Minor NSR
Program because TCEQ's rules clearly require sources making changes
under the Program to submit specific documentation, including
``sufficient information as necessary to show that the project will
comply with 40 CFR 116.150 and 116.151 of this title (relating to
Nonattainment Review) and 40 CFR 116.160-116.163 of this title
(relating to Prevention of Significant Deterioration Review) and with
Subchapter C of this Chapter 116 (relating to Hazardous Air Pollutants:
Regulations Governing Constructed or Reconstructed Major Sources (CAA
112(g), 40 CFR Part 63)).'' 30 TAC 116.117(a)(4).\10\
---------------------------------------------------------------------------
\10\ In a separate SIP submittal dated February 1, 2006, Texas
recodified the provisions of Subchapter C into Subchapter E. TCEQ's
rules also state that nothing in the rules governing the Program
shall limit the applicability of any Federal requirement. 30 TAC
116.117(d).
---------------------------------------------------------------------------
Response: As stated in the above, TCEQ's rules for Qualified
Facilities are insufficient to prevent circumvention of major NSR. See
74 FR 48450, at 48456-48458.
Comment: ERCC commented that the Qualified Facilities Program is
limited to Minor NSR. Qualified Facilities mandates compliance with 40
CFR 51.165 and 51.166, by clearly stating that any change authorized by
Qualified Facilities shall not ``limit the application of otherwise
applicable state or Federal requirements.'' TCAA 382.0512(c). TCEQ
regulations require that Qualified Facilities changes must be
documented minor source modifications. See 30 TAC 116.117(a)(4); 30 TAC
116.117(d). EPA's dismissal of Section 116.117(a)(4) as a recordkeeping
provision is unjustified. 74 FR 48450, at 48457. This Qualified
Facilities regulatory reference to the PSD and NNSR programs requires
the regulated entity to document that the change is in compliance with
the Federal major source permitting programs and in compliance with
state and Federal law.
Response: As stated above, the Qualified Facilities rules are
insufficient to prevent circumvention of Major NSR. 74 FR 48450, at
48456-48458.
Although there are recordkeeping requirements in the Program at
submitted 40 TAC 116.117(a)(4) requiring owners and operators to
maintain documentation containing sufficient information as may be
necessary to demonstrate that the project will comply with the Federal
CAA, Title I, parts C and D, these are the same general provisions as
those in the SIP at 30 TAC 116.111(a)(2)(H) and (I) for Minor and Major
NSR SIP permits. These recordkeeping requirements, although necessary
for NSR SIP approvability, cannot substitute for clear and enforceable
provisions, consistent with Texas's other Minor NSR programs, that
limit applicability in the submitted Program to Minor NSR only. 74 FR
48450, at 48456-48457.
Comment: TIP and BCCA comment that sources cannot use the Qualified
Facilities Program to circumvent Major NSR. 30 TAC 116.117(a)(4) and
(d); Modification of Existing Facilities Guidance, at 2. Senate Bill
1126, which authorized the Qualified Facilities program, does not
supersede any Federal requirements. Further, ``[i]f a change made under
the qualified facility flexibility would result in the violation of a
permit special condition, the permit holder must revise the permit
special conditions to stay in compliance with the permit,'' through
either the permit alteration process under 30 TAC 116.116(c) or the
notification process of 30 TAC 116.117(d). Modification of Existing
Facilities Guidance, at 9. Therefore, any changes to a facility must
comply with Federal NSR and PSD rules. To further show that the current
Qualified Facilities rules are sufficient to prevent circumvention,
commenter cites to EPA's proposed Indian Country rule and recently
approved state SIPs that do not contain explicit language
[[Page 19484]]
calling for a major NSR applicability determination before use of the
minor NSR tools. Alaska Admin. Code tit. 18, Sec. 50.502, approved 72
FR 45378 (August 14, 2007); 7 Del. Code Regs. Sec. 1102, 65 FR 2048
(January 13, 2000) (granting limited approval based on EPA's concerns
about public participation provisions). Further, no Federal requirement
mandates such language. Therefore, it is arbitrary for EPA to require
Texas to include additional language. CleanCoalition v. TXU Power, 536
F.3d 469, 472 (5th Cir. 2008).
Response: As stated above, EPA finds that the Qualified Facilities
regulatory provisions are inadequate to prevent circumvention of Major
NSR and limit the Program to minor modifications. TCEQ's rules and
guidance are not clear on their face that circumvention of Major NSR
requirements is prohibited. EPA does not understand how the permit
alteration and notification requirements are relevant to the issue of
circumvention of Major NSR. EPA disagrees with the commenter's analogy
to the proposed Indian Country Minor NSR rule. Today's rulemaking
disapproves the Qualified Facility Program for Major NSR, in part
because the Program fails to first require a Major NSR applicability
demonstration to show that a proposed change does not trigger Major NSR
before the source can take advantage of the Program. In contrast, under
the proposed Indian Country rule, 40 CFR 49.153 would explicitly
require the proposed new source or modification to determine
applicability to Major NSR before taking advantage of the program. 71
FR 48696, at 48705, 48728-48729. The source could only use allowables
netting under the proposed Indian Country rule after it determined that
Major NSR does not apply to the project. The Qualified Facilities rules
are deficient because they lack such a requirement, i.e., that Major
NSR does not apply to the change.
Comment: The ERCC commented that EPA sent a comment letter on the
Qualified Facilities proposed rule and agreed that it ``adequately
addresses the applicability of major sources and major modifications
with respect to PSD and NA permitting requirements.'' 21 Tex. Reg. 1569
(February 27, 1996).
Response: We acknowledge our 1995 comment letter stating that Texas
adequately satisfied our concern that the Qualified Facilities Program,
as proposed, would not circumvent or supersede any Major NSR SIP
requirements. Since we sent that letter, however, the Texas Legislature
has revised the Texas Clean Air Act significantly. Specifically, in
1999, the Texas legislature added an explicit statutory prohibition
against the use of an Exemption or Permit by Rule or a Standard Permit
for major modifications. See Texas Health and Safety Code 382.05196 and
.057. These 1999 legislative actions required a new legal review of the
statutory definition for ``modification of existing facility'' to see
if it was still limited to minor modifications. It is EPA's
interpretation that the 1999 legislative changes made this statutory
definition ambiguous. 74 FR 48450, at 48456-48457.
F. Comments Addressing Whether the Qualified Facilities Rules Meet
Federal Requirements for Minor New Source Review
1. Comments Generally Supporting Proposal
Comment: The UT Environmental Clinic commented that the CAA
requires SIPs to include a program for ``regulation of the modification
and construction of any stationary source.'' 42 U.S.C. 110(a)(2)(C).
The program must prohibit any sources, including minor sources, from
emitting pollution in amounts that contribute significantly to
nonattainment and maintenance of the NAAQS or interfere with measures
included in the SIP. 42 U.S.C. 110(a)(2)(D)(i)(I)-(II). EPA has
recognized the valuable role that Minor NSR programs play in ensuring
that air quality is protected from emissions that are not subject to
Major NSR. Technical Support Document for the Prevention of Significant
Deterioration and Nonattainment Area New Source Review Regulations,
U.S. EPA, Nov. 2002, at I-5-I-12. The Qualified Facilities Program is
deficient as a Minor NSR program because:
The Qualified Facility rules do not require enforceable
limits. Qualified Facilities provide notification of ``qualified''
changes on form PI-E,\11\ which TCEQ acknowledges is not enforceable.
Texas Commission on Environmental Quality Guidance for Air Quality,
Qualified Changes Under Senate Bill 1126 (Dec. 2000), 27 [hereinafter
Qualified Facilities Guidance]. Without enforceable limits, facilities
can use emission reductions as part of a netting analysis and
subsequently increase those emissions or rely on these reductions to
offset other increases. Some Qualified Facility representations are
consolidated into a preexisting permit upon revision or renewal at the
discretion of the source. Even if representations in the PI-E were
enforceable, there are no monitoring or reporting requirements to
demonstrate compliance. 30 TAC 116.117(a). See 74 FR 48450 (Sept. 23,
2009), Docket, Technical Support Document, pg. 22.
---------------------------------------------------------------------------
\11\ 30 TAC Sec. 116.117(b). See regulation text on pages 23-24
of the TSD for this action, which refer to 30 TAC 116.117(b)(2) and
(4).
---------------------------------------------------------------------------
The Qualified Facility Rules do not include a pre-approval
mechanism for all authorized emission increases. The rules have no
mechanism that prevents implementation of Qualified Facility changes
that may violate a control strategy or interfere with attainment or
maintenance of the NAAQS. The Program only requires Qualified
Facilities to obtain pre-approval of a Qualified Facility change if it
involves interplant \12\ trading above a ``reportable limit.'' 30 TAC
116.117(b)(4). Facilities that do not rely on interplant trading are
only required to report their changes on an annual basis. 30 TAC
116.117(b)(1).
---------------------------------------------------------------------------
\12\ Although the commenter refers to ``interplant'' trading,
the Texas rules referred to by the commenter relates to
``intraplant'' trading.
---------------------------------------------------------------------------
Response: As stated above at Section V.D.1, EPA agrees with the
first point that the submitted rules are practically unenforceable
because the reductions are not incorporated into a permit. 74 FR 48450,
at 48462.
EPA agrees with the commenter that the Program does not include a
pre-approval mechanism for all authorized emission increases. Under
section 110(a)(2)(A) and (C) of the Act, a Minor NSR SIP must require
enforceable emission limits for all minor modifications. The Texas
Program is not clear that for each Qualified Facility involved in the
netting transaction, the owner or operator must submit a permit
application and obtain a permit revision reflecting all of the changes
made to reduce emissions (relied upon in the netting analysis) as well
as reflecting the change itself that increased emissions. Furthermore,
the Program's rules at 30 TAC 116.116(e)(4) and 116.117(b)(1)-(4) are
not clear that the PI-E form is a permit application or registration
that must be submitted and that a revised permit must be issued by TCEQ
to reflect the changes made by all of the participating Qualified
Facilities. There is no discussion of when TCEQ issues the revised
permit. See the submittals at 30 TAC 116.117(b); 74 FR 48450, at 48462.
2. Comments Generally Opposing Proposal
Comment: The TCEQ commented that it has always considered the
Qualified Facilities Program to be a Minor NSR Program although it is
not stated in the rule. The rule requires the person making a change to
maintain sufficient documentation to demonstrate that the
[[Page 19485]]
project will comply with 30 TAC 116.150 and 116.161 (Nonattainment
NSR), 116.160-116.163 (Prevention of Significant Deterioration Review),
and Chapter 116, Subchapter C (relating to implementing section 112(g)
of the Act. 30 TAC 116.117(a)(4). A major modification may not occur
without going through nonattainment or PSD review. If a project is
determined to be a major modification, under PSD and/or nonattainment
rules,\13\ the owner/operator must obtain a Federal NSR permit/major
modification. Then Qualified Facilities Program does not impair TCEQ's
authority to control air pollution and take action to control a
condition of air pollution if TCEQ finds that such a condition exists.
Texas Water Code section 5.514. TCEQ commits to work with EPA to
improve and clarify the rule language to ensure that the Qualified
Facilities Program is specifically limited to Minor NSR changes. Texas
comments that it does not apply the Qualified Facilities program to
projects that are subject to Major NSR or subject to section 112(g) of
the Act.
---------------------------------------------------------------------------
\13\ 40 CFR 51.165(a)(1)(v).
---------------------------------------------------------------------------
Response: We appreciate TCEQ's willingness to work with EPA to
improve and clarify its rules to ensure that the Qualified Facilities
Program does not apply to projects that are subject to Major NSR or
subject to section 112(g). However, the Program is deficient because it
fails to include specific provisions in its rules that assure that the
Qualified Facilities Program does not apply to projects that are
subject to Major NSR or subject to section 112(g). See 74 FR 48450, at
48456-48457.
Comment: ERCC commented that EPA has failed to demonstrate the
proposed revisions interfere with Texas's ability to achieve the NAAQS.
Specifically:
Texas requires all air emissions from stationary sources
(including minor sources) receive authorization from the State. Texas
has developed an extensive program to meet the permitting and resource
challenges of this requirement and the State's numerous and varied
emission sources. States have discretion under the CAA to implement the
state minor source program as long as it does not ``interfere with
attainment of the NAAQS. Aside from this requirement, which is stated
in broad terms, the Act includes no specifics regarding the structure
or functioning of minor NSR programs * * * as a result, SIP-approved
minor NSR programs can vary quite widely from State to State.''
Operating Permit Programs; Flexible Air Permitting Rule; Final Rule, 74
FR 51,418 at 51,421 (Oct. 6, 2009). Therefore, ERCC requests that EPA
re-evaluate and withdraw the proposed disapprovals. Texas air quality
has shown dramatic improvement because of the three submitted programs.
EPA fails to recognize that these programs are similar to other
approved state minor NSR programs.
EPA's proposed disapprovals do not meet Congress' or the
Courts' documented standards for SIP disapproval. The CAA grants EPA
authority to disapprove a SIP revision if such revision would interfere
with the state's SIP. A revision interferes with the SIP if it impedes
the state's ability to achieve the NAAQS. 42 U.S.C. 7410(l); S. Rep.
No. 101-228, at 9, 1990 U.S.C.C.A.N. 3385, 3395; and Train v. NRDC, 421
U.S. 60, 79 (1975). The commenter argues that EPA has the burden to
demonstrate that the submittals interfere with the NAAQS, but EPA's
proposals shift this burden to Texas. See Hall v. EPA, 273 F.3d 1146,
1161 (9th Cir. Cal. 2001) (citing Train, 421 U.S. at 93 and Ober v.
Whitman, 243 F.3d 1190, 1195 (9th Cir. 2001)) (requiring EPA's analysis
to ``rationally connect'' approval of a revision to an area's
likelihood of meeting the NAAQS).
Since their submittal to EPA, the State's implementation
of these rules has significantly reduced statewide emissions. These
improvements can be demonstrated by reviewing both the records of
emissions reductions and the reductions measured by Texas ambient air
quality monitors.
ERCC further commented that Qualified Facilities is protective of
air quality by limiting the use of this authorization under 30 TAC
116.116(e) and 30 TAC 116.10 (11)(E) and providing incentives to
implement emission reductions. Like the Qualified Facilities Program,
EPA's proposed Indian Country Minor NSR program is based upon an
increase of allowable and not actual emissions. 71 FR 48696, at 48701.
The EPA-developed Minor NSR program also utilizes emission rates in
lieu of air quality impacts to determine exemptions from the Minor NSR
definition of modification because ``applicability determinations based
on projected air quality impacts would be excessively complex and
resource intensive.'' Id. at 48701.
Response: We agree that states have great flexibility to create
their own Minor NSR SIP programs. However, at a minimum, those Minor
NSR SIP programs must meet all of the Federal requirements. Likewise,
the Qualified Facilities Program must meet all Federal requirements
under the CAA in order to be approvable. Section V.C.1-2. As discussed
throughout our proposal and this final notice, the current Qualified
Facilities Program fails to meet all requirements. Moreover, the
Qualified Facilities Program would be an exemption from the Texas Minor
NSR SIP. The Program does not provide an alternative Minor NSR permit
authorization process but instead exempts facilities from obtaining a
NSR permit for changes. The State failed to demonstrate that this
exemption is de minimis and thus that the exempted changes will not
violate the Texas control strategies or interfere with NAAQS
attainment, as required by section 110(a)(2)(c) and 40 CFR 51.160. 74
FR 48450, at 48460; see also Section V.C.1-2, D.1, and G. of this
Response to Comments. Additionally, EPA lacks sufficient available
information to determine that the requested SIP revision relaxation
does not interfere with any applicable requirements concerning
attainment and RFP, or any other applicable requirement of the Act, as
required by section 110(l) of the Act. 74 FR 48450, at 48463; see also
Section V.D.1.
EPA disagrees with the commenter's analogy to the proposed Indian
Country Minor NSR rule. Today's rulemaking disapproves netting under
the Qualified Facilities Program for Minor NSR, in part because the
Program fails to first require a Major NSR applicability demonstration
to show that a proposed change does not trigger Major NSR before the
Qualified Facility can take advantage of the Program. The proposed
Indian Country rule would explicitly require the proposed new source or
modification first determine applicability to Major NSR before taking
advantage of the program. 71 FR 48696, at 48705, 48728-48729. The
source could only use allowables netting under the proposed Indian
Country rule after it determined that Major NSR does not apply to the
project. The Qualified Facilities rules are deficient because they lack
the requirement for a Major NSR applicability determination, not
because the Program allows allowables netting under Minor NSR. Further,
while the commenter is correct that the proposed Indian Country rule
would allow the use of emissions rates in lieu of air quality impacts,
the use of emissions rates is only to establish applicability under
Minor NSR. Such an approach is acceptable as long as the program
assures protection of the NAAQS. 71 FR 48696, at 48701.
Comment: TIP and BCCA commented that SIP revisions are approvable
if they do not interfere with the NAAQS. States have the primary
responsibility for
[[Page 19486]]
developing plans for attainment and maintenance of the NAAQS. See
CleanCOALition v. TXU Power, 536 F.3d 469, 472 n.3 (5th Cir. 2008)
(stating that ``EPA has no authority to question the wisdom of a
State's choices of emissions limitations if they are part of a SIP that
otherwise satisfies the standards set forth in 42 U.S.C. 7401(a)(2)'').
The last ten years have seen unprecedented improvement in Texas air
quality, and Texas has been implementing the Qualified Facilities
program during that time. The submittal does not raise interference
concerns because it strengthens the existing SIP; therefore the
Qualified Facilities program should be fully approvable. The proposal
states that Qualified Facilities lacks safeguards to prevent
interference with attainment and maintenance of the NAAQS. The
commenters correlate this deficiency with EPA's comments on two facets
of the submittal that EPA proposed to find approvable as long as
ambient air is protected in the trading: (1) netting is not based on
contemporaneous trading; and (2) the Program's netting is not based
totally on changes in actual emissions. TIP states that the existing
Qualified Facilities rules contain adequate safeguards of the NAAQS.
Additionally, changes are sufficiently documented and quantified to
ensure that a decrease at a facility will only be used in one netting
analysis. The provision requires that sources must document compliance
with Federal requirements safeguards the NAAQS. Commenter states that
Qualified Facilities could be viewed as an exemption to Minor NSR
requirements; however, the rules prevent changes that will violate the
Texas control strategies or interfere with NAAQS attainment. Qualified
Facilities flexibility is only allowed where the change will not result
in a net increase above existing BACT, and BACT limits were set to
protect the NAAQS. Qualified Facilities incorporates Texas's control
strategies, and therefore, safeguards the NAAQS.
Response: As stated above, in order to be approved as part of the
SIP, the Qualified Facilities Program must meet all applicable Federal
requirements. Here, the commenter's argument is not supported by the
Fifth Circuit's language in CleanCOALition, 536 F.3d at 472 n.3,
because the Qualified Facilities Program does not meet 42 U.S.C.
7410(a)(2)(C). EPA agrees with the commenter that the Qualified
Facilities Program is an exemption to the Texas Minor NSR SIP (and can
be construed to be an exemption to the Texas Major NSR SIP). A
requirement for approval of an exemption to a Minor NSR SIP is a
demonstration that the exemption will not permit changes that will
violate a state's control strategies or interfere with NAAQS
attainment. Texas failed to submit such a demonstration. In addition,
EPA lacks sufficient available information to determine that this SIP
relaxation would not interfere with NAAQS attainment, RFP, or any other
requirement of the Act. See Section V.D.1 above. Furthermore, EPA
cannot find any provisions in the Program that require a separate
netting analysis be performed for each such change. See 74 FR 48450, at
48461-48462. We also find that the Program does not prohibit future
increases at a Qualified Facility, or include regulatory language that
assures that any future increase at a Qualified Facility at which a
previous netting reduction occurred is analyzed in totality to assure
that the NAAQS are protected. The Qualified Facilities rules are
deficient to protect the NAAQS for the reasons stated above, not
because the Program allows allowables netting under Minor NSR. The
commenter asserts that these safeguards exist in the Qualified
Facilities Program but provides no citation or other basis to support
its assertion. Finally, EPA finds that the Texas rules do not
specifically require maintenance of information and analysis showing
how a source concluded that there will be no adverse impact on air
quality. 74 FR 48450, at 48462. The commenter provides no citation or
other basis to show how the Qualified Facilities Program meets this
requirement.
Comment: TxOGA commented that the documentation and notification
requirements of 30 TAC 116.117 provide safeguards to ensure that
changes will not violate the control strategy or interfere with
attainment and maintenance of the NAAQS. Also, Qualified Facilities
flexibility is only available where the change will not result in a net
increase above BACT levels at well controlled facilities.
Response: As stated above, there is not sufficient available
information to enable EPA to make a determination pursuant to section
110(l) that the Qualified Facilities Program, as a whole, would not
interfere with any applicable requirement concerning attainment and RFP
or any other requirement of the Act. Additionally, as required by
section 110(a)(2)(C) and 40 CFR 51.160, the State failed to submit
information to demonstrate that the Program, as an exemption from the
Texas Minor NSR SIP, would not permit a source that will violate the
control strategy or interfere with NAAQS attainment. See Section V.D.1
above for more information.
G. Comments Addressing Whether Existing Qualified Facilities Have
Undergone an Air Quality Analysis
Comment: The UT Environmental Clinic disagrees with EPA's statement
in the proposal that any Qualified Facility will have a Major or Minor
NSR SIP permit, will have been subject to an air quality analysis, and
will have demonstrated that its emissions have no adverse air quality
impact. 74 FR 48450, at 48560 (Sept. 23, 2009). A facility can qualify
as a Qualified Facility if it uses technology at least as effective as
10-year old BACT, ``regardless of whether the facility has received a
preconstruction permit or permit amendment or has been exempted under
the TCCA, 382.057.'' 30 TAC 116.11(E)(ii). Likewise, the Qualified
Facility rules specifically provide for preapproval of Qualified Status
of those facilities that do not have an allowable emissions limit in a
permit, PI-8 or PI-E form.
The commenter further states that, while Texas rules generally
require emissions to have some sort of authorization, the rules do
exempt some increases from the definition of ``modification,'' thereby
allowing these emissions to avoid any review. 30 TAC 116.10(11). For
emissions that must be permitted, TCEQ's rules allow the use of various
permitting mechanism that do not assure protection of the NAAQS and
control strategy requirements. 30 TAC 116.110(a).
The commenter states that the rules additionally provide that
unless one ``facility'' at an account has been subject to public notice
under the Chapter 116 permitting or renewal provisions, total emissions
from all facilities permitted by rules at an account shall not exceed
the limits referenced in 30 TAC 106(a)(4). Because it is rare that at
least one facility at an account has not been through public notice,
companies are allowed to use multiple permits-by-rule to authorize
emissions at a source. See UT Environmental Clinic Comment Letter,
Attachment 5: Chart of facility PBR authorizations. TCEQ does not
analyze the cumulative air quality impact of these multiple
authorizations. TCEQ rules require permits-by-rule and standard permits
to be ``incorporated' into the facility's permit after the permit is
renewed or amended; and there are no rules regarding procedures or
modeling for such ``incorporation.''
Finally, the commenter stated that TCEQ has issued guidance that
requires standard permits and PBRs that ``directly affect the emissions
of
[[Page 19487]]
permitted facilities'' to be ``consolidated by reference'' at renewal
or amendment. Texas Commission on Environmental Quality, Permit by Rule
and Standard Permit Consolidation Into Permits (Sept 1, 2006), 3. Any
PBRs and standard permits that do not affect emissions permitted
facilities can be incorporated at the discretion of the permittee. Id
at 4. The TCEQ guidance requires such PBRs and standard permits that
are consolidated by incorporation to undergo an impacts review. Because
these permits are renewed every ten years, this review may not occur
for many years. Furthermore, PBRs do not require Texas BACT.
Response: We agree with the commenter's assertion that the
submitted regulations do not explicitly require an air quality impacts
analysis whenever a facility uses technology at least as effective as
10-year old Minor NSR BACT, ``regardless of whether the facility has
received a preconstruction permit or permit amendment or has been
exempted under the TCCA 382.057.'' Further, facilities ``qualified''
using technology at least as effective as 10-year old Minor NSR BACT,
must use actual emissions as a baseline. See 30 TAC 116.10(2) and
116.116(e)(2)(C). Presumably, this provision exists because facilities
``qualified'' under 30 TAC 116.10(11)(E)(ii), would not have a
permitted allowable emissions limit because they lack an underlying
permit. If a facility could be ``qualified'' without having a pre-
construction permit, then the facility could net-out of permit
requirements without ever having an air quality analysis of the
baseline allowables limit. TCEQ's comments, which are summarized below,
imply that State law requires all sources in Texas to get an underlying
permit, and therefore, receive an air quality impact analysis. However,
we view the State's comment to be vague as to whether a permit is a
pre-requisite under the Program itself. Therefore, the Qualified
Facilities rules are deficient because they fail to require an
underlying Texas NSR SIP permit and air quality impact analysis in
order to be ``qualified'' under the Program.
Comments concerning the State's permit-by-rule and standard permit
programs are outside the scope of this rulemaking.
Comment: TCEQ commented that the Texas Legislature created the
Qualified Facilities Program to provide flexibility to permitted
facilities and to provide a means by which grandfathered facilities
could apply control technology and become ``qualified'' grandfathered
facilities without triggering Federal NSR. Subsequently, in 2001, the
legislature required all grandfathered facilities to obtain
authorization or shutdown. The program remains in effect as emissions
are controlled, no new emissions above existing allowable limits are
allowed, and Federal requirements are considered and met.
In summary, the Program reinforced the TCEQ's duties under the
Texas Clean Air Act to protect air quality and control air contaminant
emissions by practical and economically feasible methods. Tex. Health &
Safety Code 382.002, 382.003(9)(e). Therefore, the environment has
benefitted from the Program because emissions were controlled prior to
the Texas Legislature mandating shut down or obtaining authorization;
air quality benefitted as demonstrated by monitoring which measured
continued improvement; regulated entities benefitted because they were
given flexibility; and the State benefitted by reasonable regulation
that encourages responsible economic development.
TCEQ also commented that allowable emissions (both hourly and
annual rates) are one of the criteria used to provide ``state
qualified'' flexibility because the facilities must exist and be
authorized, and thereby undergone appropriate permit review.
Response: As stated above, we find that the Qualified Facilities
rules fail to explicitly require a permit before a facility can be
``qualified'' under the Program. While TCEQ asserts that to become a
Qualified Facility, a facility must undergo permit review and be
authorized, the State does not cite to any regulatory provision in the
Program that explicitly requires such permitting authorization. EPA
recognizes that State legislation subsequent to the Qualified
Facilities Program required grandfathered facilities to obtain permit
authorizations or shut down. There is nothing sufficiently explicit,
however, in the Qualified Facilities Rules that ensures all Qualified
Facilities received an air quality impacts analysis through an initial
permit application review process. It is commendable that TCEQ intends
to implement its Qualified Facilities Program in a manner that may
benefit the environment, but Texas failed to incorporate these
procedures into its regulations; therefore, these procedures are not
Federally enforceable.
H. Comments on the Definitions of ``Grandfathered Facility,'' ``Maximum
Allowable Emission Rate Table,'' and ``New Facility''
Comment: TCEQ and TCC agree with EPA's proposal to approve the
definitions of ``grandfathered facility,'' ``maximum allowable emission
rate table,'' and ``new facility.'' The TCEQ urges EPA to take final
action to approve these definitions.
Response: These comments further support EPA's action to approve
these definitions.
I. Comments on the Definitions of ``Actual Emissions,'' ``Allowable
Emissions,'' ``Modification of Existing Facility'' at (E), and
``Qualified Facility''
Comment: TCEQ confirmed that Senate Bill 1126 amended the Texas
Clean Air Act by revising the definition of ``modification of existing
facility,'' which changed the factors used to determine whether a
modification for State permitting (i.e. Minor NSR) has occurred. In
1996, 30 TAC Chapter 116 was revised to incorporate this legislative
directive. These changes provide that modifications may be made to
existing facilities without triggering the State's Minor NSR
requirements whenever:
Authorization for the facility to be modified was issued a
permit, permit amendment, or was exempted from permitting requirements
within 120 months from when the change will occur; or
Uses air pollution control methods that are at least as
effective as the BACT that was required within 120 months from when the
change will occur.
Such facilities are designated as ``qualified facilities.'' TCEQ
considers the use of ``modification'' to be separate and severable from
the Federal definition of ``modification'' as reflected in the SIP-
approved Major NSR Program.
TCEQ further asserts that the definitions of ``actual emissions,''
``allowable emissions,'' ``modification of existing facility'' at (E)
``qualified facility,'' respectively at 30 TAC 116.10(1), (2), (11)(E),
and (16), meet Federal requirements.
Response: We are disapproving these definitions because they are
not severable from the Qualified Facilities Program, and the State
failed to submit information sufficient to demonstrate how these
definitions meet Federal requirements. The definitions of ``actual
emissions'' and ``allowable emissions'' include a statement that limits
these definitions only when determining whether there has been a net
increase in allowable emissions under 30 TAC 116.116(e), which
implements the Qualified Facilities Program, and thus makes these
definitions not severable from the Program. Subsection (E) of the
definition of ``modification of existing facility'' only applies to
changes that do not result in a net increase in allowable
[[Page 19488]]
emissions, which implements the Qualified Facilities Program, and thus
makes this subsection not severable from the Program. The definition of
``qualified facility'' defines a term that is used in the Qualified
Facilities Program, which makes it not severable from the Qualified
Facilities Program.
Furthermore, the State did not provide sufficient information to
demonstrate how these definitions meet Federal requirements.
Additionally, State legislative actions in 1999 made the statutory
definition of ``modification of existing facility'' ambiguous as to
whether the definition is still limited to minor modifications. The
State did not submit any legal support for TCEQ's assertion that the
use of ``modification'' in the Texas Clean Air Act is for Minor NSR
only; and therefore separate and severable from the definition of
``modification'' in the Texas Major NSR SIP. See 74 FR 48450, at 48456-
48457 and Section V.E.2 above for further information.
J. Comments on the Definition of ``Best Available Control Technology''
(``BACT'')
Comment: The UT Environmental Clinic, TCC, TIP, BCCA, TxOGA, GCLC,
and TCEQ provided comments on EPA's proposed disapproval of TCEQ's
definition of BACT.
Response: We are not taking final action on the definition of BACT
in today's rulemaking; therefore, these comments are outside the scope
of our rulemaking. They will be considered, however, in our final
action on this definition.
K. Comments on Severable Portions of the Definition of ``Modification
of Existing Facility'' at 30 TAC 116.10(11)(A) & (B)
Comment: The UT Environmental Clinic, TxOGA, TIP, BCCA, and TCEQ
provided comments on EPA's proposed disapproval of TCEQ's changes to
the definition of ``modification of existing facility'' at 30 TAC
116.10(11)(A) and (B) regarding insignificant increases.
Response: We are not taking final action on 30 TAC 116.10(11)(A)
and (B) of the definition of ``modification of existing facility'' in
today's rulemaking; therefore, these comments are outside the scope of
our rulemaking. They, however, will be considered in our final agency
action on these two definitions.
L. Comments on the Definition of Severable Subsection of ``Modification
of Existing Facility'' at 30 TAC 116.10(11)(G)
Comment: The UT Environmental Clinic and TCEQ provided comments on
the proposed disapproval of 30 TAC 116.10(11)(G) of the definition of
``modification of existing facility.''
Response: We are not taking final action on 30 TAC 116.10(11)(G) of
the definition of ``modification of existing facility'' in today's
rulemaking; therefore, these comments are outside the scope of our
rulemaking. They will be considered, however, in our final agency
action on this definition.
M. Comments on the Reinstatement of the Previously Approved Definition
of ``Facility''
Comment: The TCEQ acknowledges that EPA proposes to correct a
typographical error in 72 FR 49198 to clarify that the definition of
``facility,'' as codified at 30 TAC 116.10(6), was approved as part of
the Texas SIP in 2006 and remains part of the Texas SIP. 74 FR 48450,
at 48455 at n.6.
Response: EPA thanks TCEQ for its acknowledgement that the
definition of ``facility'' at 30 TAC 116.10(6) was approved as part of
the Texas SIP in 2006 and remains part of the Texas SIP. We are making
the administrative change to correct the typographical error in the
Code of Federal Regulations.
In our proposed rule notice, we requested comments on the State's
legal meaning of the term ``facility.'' See 30 TAC 116.10(6). We stated
that the interpretation of this term is critical to our understanding
of the Texas Permitting Program. We received the following comments on
this issue:
1. Comments Generally Supporting Proposal
Comment: The UT Environmental Clinic understands that EPA's
proposal is only to correct a typographical error that inadvertently
removed the definition of ``facility'' from the SIP. The commenter
notes, however, that Texas's use of this term is problematic because of
its dual definitions and broad meanings. The commenter compares Texas's
definition of ``facility'' in 30 TAC 116.10 with the definition of
``stationary source'' in 30 TAC 116.12 and the definition of
``building, structure, facility, or installation'' in 30 TAC 116.12 and
conclude that these definitions are quite similar. The commenters
acknowledge that this argument assumes that one can rely on the
Nonattainment NSR rules to interpret the general definitions. If one
cannot use the Nonattainment NSR definitions to interpret the general
definition of ``facility,'' then one must resort to the definition of
``source'' in 30 TAC 116.10(17), which is defined as ``a point of
origin of air contaminants, whether privately or publicly owned or
operated.'' Pursuant to this reading, a facility is more like a Federal
``emissions unit.'' 40 CFR 51.165(a)(1)(vii). ```Emissions unit' means
any part of a stationary source that emits or would have the potential
to emit any regulated NSR pollutant [hellip]'' At least in the
Qualified Facility rules, it appears that TCEQ use of the definition of
``facility'' is more like a Federal ``emissions unit.'' The circular
nature of these definitions, and the existence of two different
definitions of ``facility'' without clear description of their
applicability, makes Texas's rules, including the Qualified Facility
rules, vague. Commenters urge EPA to require Texas to clarify its
definition of ``facility'' and to ensure that its use of the term
throughout the rules is consistent with that definition.
2. Comments Generally Opposing Proposal
Comment: TCEQ responded to EPA's request concerning its
interpretation of Texas law and the Texas SIP with respect to the term
``facility.'' The definition of ``facility'' is the cornerstone of the
Texas Permitting Program under the Texas Clean Air Act. In addition, to
provide clarity and consistency, TCEQ also provides similar comments in
regard to Docket ID No. EPA-R06-OAR-2005-TX-0032 and EPA-R06-OAR-2006-
0133. EPA believes that the State uses a ``dual definition'' for the
term facility. Under the TCAA and TCEQ rule, ``facility'' is defined as
``a discrete or identifiable structure, device, item, equipment, or
enclosure that constitutes or contains a stationary source, including
appurtenances other than emission control equipment. Tex. Health &
Safety Code 382.003(6); 30 TAC 116.10(6). A mine, quarry, well test, or
road is not considered to be a facility.'' A facility may contain a
stationary source--point of origin of a contaminant. Tex. Health &
Safety Code 382.003(12). As a discrete point, a facility can constitute
but cannot contain a major stationary source as defined by Federal law.
A facility is subject to Major and Minor NSR requirements, depending on
the facts of the specific application. Under Major NSR, EPA uses the
term ``emissions unit'' (generally) when referring to a part of a
``stationary source,'' TCEQ translates ``emissions unit'' to mean
``facility,'' \14\ which is at least as stringent as Federal rule. TCEQ
and its predecessor agencies have consistently interpreted facility to
preclude inclusion of more than one stationary source, in contrast to
EPA's stated understanding. Likewise, TCEQ
[[Page 19489]]
does not interpret facility to include ``every emissions point on a
company site, even if limiting these emission points to only those
belonging to the same industrial grouping (SIC Code).'' The Federal
definition of ``major stationary source'' is not equivalent to the
state definition of ``source.'' 40 CFR 51.166(b)(1)(a). A ``major
stationary source'' \15\ can include more than one ``facility'' as
defined under Texas law--which is consistent with EPA's interpretation
of a ``major stationary source'' including more than one emissions
unit. The above interpretation of ``facility'' has been consistently
applied by TCEQ and its predecessor agencies for more than 30 years.
The TCEQ's interpretation of Texas statutes enacted by the Texas
Legislature is addressed by the Texas Code Construction Act. More
specifically, words and phrases that have acquired a technical or
particular meaning, whether by legislative definition or otherwise,
shall be construed accordingly. Tex. Gov't Code 311.011(b). While Texas
law does not directly refer to the two steps allowing deference
enunciated in Chevron U.S.A., Inc. v. Natural Resources Defense
Council, Inc., Texas law and judicial interpretation recognize Chevron
\16\ and follow similar analysis as discussed below. The Texas
Legislature intends an agency created to centralize expertise in a
certain regulatory area ``be given a large degree of latitude in the
methods it uses to accomplish its regulatory function.'' Phillips
Petroleum Co. v. Comm'n on Envtl. Quality, 121 S.W.3d 502, 508
(Tex.App.--Austin 2003, no pet.), which cites Chevron to support the
following: ``Our task is to determine whether an agency's decision is
based upon a permissible interpretation of its statutory scheme.''
Further, Texas courts construe the test of an administrative rule under
the same principles as if it were a statute. Texas Gen. Indem. Co. v.
Finance Comm'n, 36 S.W.3d 635,641 (Tex.App.--Austin 2000, no pet.).
Texas Administrative agencies have the power to interpret their own
rules, and their interpretation is entitled to great weight and
deference. Id. The agency's construction of its rule is controlling
unless it is plainly erroneous or inconsistent. Id. ``When the
construction of an administrative regulation rather than a statute is
at issue, deference is even more clearly in order.'' Udall v. Tallman,
380 U.S. 1, 17 (1965). This is particularly true when the rule involves
complex subject matter. See Equitable Trust Co. v. Finance Comm'n, 99
S.W.3d 384, 387 (Tex.App.--Austin 2003, no pet.). Texas courts
recognize that the legislature intends an agency created to centralize
expertise in a certain regulatory area ``be given a large degree of
latitude in the methods it uses to accomplish its regulatory
function.'' Reliant Energy, Inc. v. Public Util. Comm'n, 62 S.W.3d
833,838 (Tex.App.--Austin 2001, no pet.)(citing State v. Public Util.
Comm'n, 883 S.W.2d 190, 197 (Tex. 1994). In summary, TCEQ translates
``emissions unit'' to mean ``facility.'' Just as an ``emissions unit''
under Federal law is construed by EPA as part of a major stationary
source, a ``facility'' under Texas law can be a part of a major
stationary source. However, a facility cannot include more than one
stationary source as defined under Texas law.
---------------------------------------------------------------------------
\14\ The term ``facility'' shall replace the words ``emissions
unit'' in the referenced sections of the CFR. 30 TAC 116.160(c)(3).
\15\ Tex. Health & Safety Code Sec. 382.003(12).
\16\ Chevron U.S.A., Inc. v. Natural Resources Defense Council,
Inc., 467 U.S. 387, 842-43 (1984). ``When a court reviews an
agency's construction of the statute which it administers, it is
confronted with two questions. First, always is the question whether
Congress has directly spoken to the precise question at issue. If
the intent of Congress is clear, that is the end of the matter, for
the court, as well as the agency, must give effect to the
unambiguously express intent of Congress. If, however, the court
determines Congress has not directly addressed the precise question
at issue, the court does not simply impose its own construction on
the statute, as would be necessary in the absence of an
administrative interpretation. Rather, if the statute is silent or
ambiguous with respect to the specific issue, the question for the
court is whether the agency's answer is based on a permissible
construction of the statute.''
---------------------------------------------------------------------------
Comment: TCC, BCCA, TIP, and TxOGA commented that Texas rules are
clear that ``facility,'' as defined in 30 TAC 116.10(6) is equivalent
to the TCEQ term ``emissions unit.''\17\ TCC also stated that the
definition of ``facility'' is so broad that it requires every possible
source of air contaminants to obtain some type of approval from TCEQ.
---------------------------------------------------------------------------
\17\ Additionally, the definition of ``facility'' is similar to
the definition of ``emission unit'' in Texas's Title V rules. 30 TAC
122.10(8).
---------------------------------------------------------------------------
Response: We have determined that Texas's use of this term
``facility,'' as it applies to the State's Qualified Facilities
Program, is overly vague, and therefore, unenforceable. TCEQ comments
that it translates ``emissions unit'' to mean ``facility.'' Yet,
Texas's PSD non-PAL rules explicitly limit the definition of
``facility'' to ``emissions unit,'' but the Qualified Facilities rules
fail to make such a limitation. 74 FR 48450, at 48475; compare 30 TAC
116.10(6) to 30 TAC 116.160(c)(3). The State clearly thought the
prudent legal course was to limit ``facility'' explicitly to
``emissions unit'' in its PSD SIP non-PALs revision. However, TCEQ did
not submit information sufficient to demonstrate that the lack of this
explicit limitation in the submitted Qualified Facilities revisions is
at least as stringent as the revised definition in the PSD non-PALs
definition.
We recognize that TCEQ should be accorded a level of deference to
interpret the State's statutes and regulations; however, such
interpretations must meet applicable requirements of the Act and
implementing regulations under 40 CFR part 51 to be approvable into the
SIP as Federally enforceable requirements. The State has failed to
provide any case law or SIP citation that confirms TCEQ's
interpretation for ``facility'' under the Qualified Facilities Program
that would ensure Federal enforceability.
Nevertheless, as stated above, the definition of ``facility'' at 30
TAC 116.10(6) was approved as part of the Texas SIP in 2006 and remains
part of the Texas SIP. Therefore, EPA is obligated to correct the
typographical error and reinstate the definition of ``facility'' into
the Code of Federal Regulations.
However, today's final disapproval of the Qualified Facilities
Program is based in part on the lack of clarity of the definition of
``facility'' as it applies specifically to this Program. Additionally,
EPA has proposed disapproval of the State's Flexible Permit Program and
NSR Reform SIP submittals partially based on the need for clarity of
the definition of ``facility'' as it applies to those programs.
N. Comments on the Definition of the Term ``Air Quality Account
Number''
Comment: The TCEQ commented that it no longer uses the term ``air
quality account number'' and now uses the term ``account,'' which is a
SIP-approved definition.\18\ Administrative changes to the Qualified
Facilities Program are planned to reflect the change in terms.
---------------------------------------------------------------------------
\18\ 30 TAC 101.1(1) Account--For those sources required to be
permitted under Chapter 122 of this title * * *, all sources that
are aggregated as a site. For all other sources, any combination of
sources under common ownership or control and located on one or more
contiguous properties, or properties contiguous except for
intervening roads, railways, rights-of-way, waterways, or similar
divisions. Approved as part of the Texas SIP at 70 FR 16129 (March
30, 2005).
---------------------------------------------------------------------------
Response: EPA's evaluation of ``account'' and ``air quality account
number'' were based upon the SIP-approved definition of ``account.'' 74
FR 48450, at 48455, n.7. The State's comment that it no longer uses
``air quality account number'' but uses ``account'' does not change
EPA's final decision to disapprove the Qualified Facilities Program SIP
revision submittal. In fact, the State's using a different definition
that is not in the Qualified Facilities Program's rules
[[Page 19490]]
provides additional grounds for disapproval. The Qualified Facilities
Program's rules must be clear about which sources on a site can
participate in the netting process. This goes to the heart of whether
the changes are made outside a major stationary source. If TCEQ makes
the planned changes noted in the comment letter, the changes must be
adopted and submitted to EPA for approval as a SIP revision. Upon
receipt, we would review the regulatory changes and evaluate whether
they meet the Act and EPA regulations.
The Texas SIP defines an ``account'' to include an entire company
site, which could include more than one plant and more than one major
stationary source. SIP rule 30 TAC 101.1(1), second sentence. It does
not limit the combination of sources to a SIC code. As stated above,
EPA interprets the Program to allow an emission increase to net out by
taking into account emission decreases outside of the major stationary
source. Therefore, the Program does not meet the CAA's definition of
``modification'' and the Major NSR SIP requirements and is inconsistent
with Asarco v. EPA, 578 F.2d 320 (DC Cir. 1978). 74 FR 48450, at 48458-
48459; Section IV.B. above.
O. Comments on Whether the Qualified Facilities Rules Meet New Source
Review Public Participation Requirements
1. Comments Generally Supporting Proposal
Comment: HCPHES commented that the State's public participation
rules are not user friendly with regards to timeliness of initial
notification and the time restrictions for public comment.
Specifically, it is not uncommon for a permit modification or amendment
notification to be delayed on occasion, which results in a shorter
period for citizens as well as HCPHES to respond. These situations have
unduly limited the opportunities for the public and affected agencies
to be able to provide meaningful reviews and submit appropriate
comments. The commenter supports EPA's conclusion to disapprove
portions of the SIP as proposed until such time as TCEQ addresses all
of the specifics noted in the Federal Register. In addition, HCPHES
strongly supports strengthening public participation rules such that
Texas citizens are able to participate meaningfully in the process.
Comment: Several members of the Texas House commented that while
the Qualified Facilities Program was a legislative creation, these
members of the Texas House recognize that the statutory language and
associated regulations are inconsistent with current CAA requirements
regarding modifications and public participation. A particular concern
is inadequate public participation.
Comment: HCPHES strongly supports strengthening public
participation rules such that Texas citizens are able to participate
meaningfully in the process.
Response: General comments on Texas's public participation
requirements are outside the scope of this rulemaking. However, in a
separate action, EPA has proposed a limited approval/limited
disapproval of Texas's SIP submittal for public participation (73 FR
72001 (Nov. 26, 2008)). In addition, TCEQ has proposed revisions to
these rules and EPA is working with TCEQ to strengthen its rules for
public participation to ensure the State's rules comply with all
Federal requirements.
2. Comments Generally Opposing Proposal
Comment: The UT Environmental Clinic commented that the Qualified
Facilities Rules allow industrial plants to make changes that can
affect neighboring residents with absolutely no notice or opportunity
for participation. These rules allow modifications without meeting the
Federal public participation requirements that are applicable to
Nonattainment NSR and PSD permits under the Act, 40 CFR 51.161, and 40
CFR 51.166(q). TCEQ's Qualified Facilities guidance specifically states
that the qualified facility notification process may be used instead of
the alteration process to change permit special conditions. Qualified
Facilities Guidance, at 14.
Response: EPA agrees with the commenter that the Qualified
Facilities rules do not meet the Federal public participation
requirements for each individual change, either for a Major or Minor
NSR SIP revision. As discussed in more detail in Section V.D.1 above,
the Program does not clearly require a permit for each change.
Therefore, the Program does not provide an opportunity for public
review, which circumvents public participation requirements in 40 CFR
51.161. See 74 FR 48450, at 48459-48460.
Comment: The UT Environmental Clinic comments that the Texas rules
also allow sources to amend terms and conditions of a Major NSR or
Minor NSR permit without public participation. EPA has already
expressed concerns to Texas about using methods other than permit
amendment for making changes to individual NSR permits. Letter to Dan
Eden, TCEQ, Deputy Director, from Carl Edlund, EPA, Region 6, Director,
Multimedia Planning and Permitting Division (March 12, 2008), p. 8.
Letter to Richard Hyde, TCEQ, Director Air Permits Division from Jeff
Robinson, EPA, Chief, Air Permits Section (May 21, 2008), p. 6.
Response: The comments that TCEQ's rules allow sources to amend
terms and conditions of a Major NSR or Minor NSR permit without public
participation and the use of methods other than permit amendments are
outside the scope of this rulemaking.
Comment: GCLC provided comments on Texas's public participation
program because the public participation issues are implicated
throughout the three Federal Register notices (Qualified Facilities,
Flexible Permits, and NSR Reform). GCLC considers these comments timely
and appropriate because EPA's proposal directs the public to read the
three pending notices and the November 2008 public participation
proposal ``in conjunction'' with each other.
Response: We recognize the need to read the notices in conjunction
with each other because the permits issued under these State programs
are the vehicles for regulating a significant universe of the air
emissions from sources in Texas and thus directly impact the ability of
the State to achieve and maintain attainment of the NAAQS and to
protect the health of the communities where these sources are located.
74 FR 48450, at 48453. However, this final rulemaking only addresses
the Qualified Facilities Program. Therefore, specific issues related to
the public participation submittal package are outside the scope of
this rulemaking.
Comment: The ERCC commented that public review requirements have
been met because the implementing regulations for Qualified Facilities
were subject to notice and comment. Proposed on 20 Tex. Reg. 8308
(October 10, 1995) finalized on 21 Tex. Reg. 1569 (February 27, 1996).
Response: EPA agrees with the commenter that the Qualified
Facilities rules met the public participation requirements for SIP
revision submittals. EPA, however, disagrees with the commenter that
the permit application public participation requirements of this
submitted Qualified Facilities program meets the NSR public
participation requirements for individual permit applications. Where
the adopted State rules fail to provide for the minimum public
participation required under Federal law for individual permit
applications,
[[Page 19491]]
Federal public participation requirements cannot be considered met just
because the deficient State rules were adopted after public notice and
comment. Please see our comments above.
VI. Final Action
EPA is disapproving revisions to the SIP submitted by the State of
Texas that relate to the Modification of Qualified Facilities,
identified in the Table in section III.B of this action. These affected
provisions include the following regulations under Chapter 116: 30 TAC
116.116(e), 30 TAC 116.117, 30 TAC 116.118, and the following
definitions under 30 TAC 116.10--General Definitions: 30 TAC
116.10(1)--definition of ``actual emissions,'' 30 TAC 116.10(2)--
definition of ``allowable emissions,'' 30 TAC 116.10(11)(E) under the
definition of ``modification of existing facility,'' and 30 TAC
116.10(16)--definition of ``qualified facility.'' EPA finds that these
submitted provisions and definitions in the submitted Texas Qualified
Facilities Program are not severable from each other.
EPA is disapproving the submitted Texas Qualified Facilities
Program as a substitute Major NSR SIP revision because it does not meet
the Act and EPA's regulations. We are also disapproving the submitted
Qualified Facilities Program as a Minor NSR SIP revision because it
does not meet the Act and EPA's regulations.
The Qualified Facilities Program submittals do not meet the
requirements for a substitute Major NSR SIP revisions because (1) the
Program does not prevent circumvention of Major NSR; (2) the State
failed to submit information sufficient to demonstrate that the
Program's regulatory text requires an evaluation of Major NSR
applicability before a change is exempted from permitting; (3) the
Program is deficient for Major NSR netting because (a) it authorizes
the use of allowable, rather than actual emissions, to be used as a
baseline to determine applicability. This use of allowables violates
the Act and Major NSR SIP requirements and is contrary to New York v.
EPA, 413 F.3d 3, 38-40 (DC Cir. 2005) (``New York I'') and (b) it could
allow an emission increase to net out by taking into account emission
decreases outside of the major stationary source and, in other
circumstances, allow an evaluation of emissions of a subset of units at
a major stationary source; and (4) there is not sufficient available
information to enable EPA to make a determination that the requested
SIP revision relaxation would not interfere with any applicable
requirements concerning attainment, RFP, or any other applicable CAA
requirement, as required by section 110(l).
The Qualified Facilities Program submittals do not meet the
requirements for a Minor NSR SIP revision. The submitted Program (1)
fails to ensure that the Major NSR SIP requirements continue to be met;
(2) is not limited only to Minor NSR; (3) fails to include sufficient
legally enforceable safeguards to ensure that the NAAQS and control
strategies are protected; (4) the State failed to demonstrate that the
Program's exemption from the Texas Minor NSR SIP includes legally
enforceable procedures to ensure that the State will not permit a
source that will violate the NAAQS or the State's control strategies,
(5) the submitted Program does not provide clear and enforceable
requirements for a basic Minor NSR netting program; and (6) EPA lacks
sufficient information to make a determination that the requested SIP
revision relaxation does not interfere with any applicable requirements
concerning attainment and RFP, or any other applicable requirement of
the Act, as required by section 110(l). Therefore, we are disapproving
the submitted Qualified Facilities Program as a Minor NSR SIP revision
because it does not meet sections 110(a)(2)(C) and 110(l) of the Act
and 40 CFR 51.160.
EPA is approving the submitted definitions for ``grandfathered
facility,'' ``maximum allowable emissions rate table (MAERT),'' and
``new facility.'' Finally, EPA is finalizing an administrative
correction in today's action by specifically correcting a typographical
error at 72 FR 49198 to clarify that the definition of ``facility'' as
codified at 30 TAC 116.10(6) was approved as part of the Texas SIP in
2006 and remains part of the Texas SIP.
VII. Statutory and Executive Order Reviews
A. Executive Order 12866, Regulatory Planning and Review
This final action has been determined not to be a ``significant
regulatory action'' subject to review by the Office of Management and
Budget under Executive Order 12866 (58 FR 51735, October 4, 1993).
B. Paperwork Reduction Act
This action does not impose an information collection burden under
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.,
because this SIP disapproval under section 110 and subchapter I, part D
of the Clean Air Act will not in-and-of itself create any new
information collection burdens but simply disapproves certain State
requirements for inclusion into the SIP. Burden is defined at 5 CFR
1320.3(b). Because this final action does not impose an information
collection burden, the Paperwork Reduction Act does not apply.
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency
to conduct a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements unless the agency certifies
that the rule will not have a significant economic impact on a
substantial number of small entities. Small entities include small
businesses, small not-for-profit enterprises, and small governmental
jurisdictions. For purposes of assessing the impacts of today's rule on
small entities, small entity is defined as: (1) A small business as
defined by the Small Business Administration's (SBA) regulations at 13
CFR 121.201; (2) a small governmental jurisdiction that is a government
of a city, county, town, school district or special district with a
population of less than 50,000; and (3) a small organization that is
any not-for-profit enterprise which is independently owned and operated
and is not dominant in its field. This rule will not have a significant
impact on a substantial number of small entities because SIP approvals
and disapprovals under section 110 and part D of the Clean Air Act do
not create any new requirements but simply approve or disapprove
requirements that the States are already imposing.
Furthermore, as explained in this action, the submissions do not
meet the requirements of the Act and EPA cannot approve the
submissions. The final disapproval will not affect any existing State
requirements applicable to small entities in the State of Texas.
Federal disapproval of a State submittal does not affect its State
enforceability. After considering the economic impacts of today's
rulemaking on small entities, and because the Federal SIP disapproval
does not create any new requirements or impact a substantial number of
small entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. Moreover,
due to the nature of the Federal-State relationship under the Clean Air
Act, preparation of flexibility analysis would constitute Federal
inquiry into the economic reasonableness of state action. The Clean Air
Act forbids EPA to base its actions concerning SIPs on such
[[Page 19492]]
grounds. Union Electric Co., v. U.S. EPA, 427 U.S. 246, 255-66 (1976);
42 7410(a)(2).
D. Unfunded Mandates Reform Act
This action contains no Federal mandates under the provisions of
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C.
1531-1538 ``for State, local, or tribal governments or the private
sector.'' EPA has determined that the disapproval action does not
include a Federal mandate that may result in estimated costs of $100
million or more to either State, local, or tribal governments in the
aggregate, or to the private sector. This Federal action determines
that pre-existing requirements under State or local law should not be
approved as part of the Federally approved SIP. It imposes no new
requirements. Accordingly, no additional costs to State, local, or
tribal governments, or to the private sector, result from this action.
E. Executive Order 13132, Federalism
Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August
10, 1999), requires EPA to develop an accountable process to ensure
``meaningful and timely input by State and local officials in the
development of regulatory policies that have Federalism implications.''
``Policies that have Federalism implications'' is defined in the
Executive Order to include regulations that have ``substantial direct
effects on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government.''
This action does not have Federalism implications. It will not have
substantial direct effects on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government, as
specified in Executive Order 13132, because it merely disapproves
certain State requirements for inclusion into the SIP and does not
alter the relationship or the distribution of power and
responsibilities established in the Clean Air Act. Thus, Executive
Order 13132 does not apply to this action.
F. Executive Order 13175, Coordination With Indian Tribal Governments
This action does not have tribal implications, as specified in
Executive Order 13175 (59 FR 22951, November 9, 2000), because the SIP
EPA is disapproving would not apply in Indian country located in the
State, and EPA notes that it will not impose substantial direct costs
on tribal governments or preempt tribal law. This final rule does not
have tribal implications, as specified in Executive Order 13175. It
will not have substantial direct effects on tribal governments, 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. This action does not involve or impose
any requirements that affect Indian Tribes. Thus, Executive Order 13175
does not apply to this action.
G. Executive Order 13045, Protection of Children From Environmental
Health Risks and Safety Risks
EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997)
as applying only to those regulatory actions that concern health or
safety risks, such that the analysis required under section 5-501 of
the Executive Order has the potential to influence the regulation. This
action is not subject to Executive Order 13045 because it is not an
economically significant regulatory action based on health or safety
risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997).
This SIP disapproval under section 110 and subchapter I, part D of the
Clean Air Act will not in-and-of itself create any new regulations but
simply disapproves certain State requirements for inclusion into the
SIP.
H. Executive Order 13211, Actions That Significantly Affect Energy
Supply, Distribution, or Use
This rule is not subject to Executive Order 13211 (66 FR 28355, May
22, 2001) because it is not a significant regulatory action under
Executive Order 12866.
I. National Technology Transfer and Advancement Act
Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law No. 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. NTTAA directs EPA to
provide Congress, through the Office of Management and Budget,
explanations when the Agency decides not to use available and
applicable voluntary consensus standards.
The EPA believes that this action is not subject to requirements of
Section 12(d) of NTTAA because application of those requirements would
be inconsistent with the Clean Air Act. Today's action does not require
the public to perform activities conducive to the use of VCS.
J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations
Executive Order 12898 (59 FR 7629, (February 16, 1994)) establishes
Federal executive policy on environmental justice. Its main provision
directs Federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
EPA lacks the discretionary authority to address environmental
justice in this action. In reviewing SIP submissions, EPA's role is to
approve or disapprove state choices, based on the criteria of the Clean
Air Act. Accordingly, this action merely disapproves certain State
requirements for inclusion into the SIP under section 110 and
subchapter I, part D of the Clean Air Act and will not in-and-of itself
create any new requirements. Accordingly, it does not provide EPA with
the discretionary authority to address, as appropriate,
disproportionate human health or environmental effects, using
practicable and legally permissible methods, under Executive Order
12898.
K. Congressional Review Act
The Congressional Review Act, 5 U.S.C. section 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 this
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.
[[Page 19493]]
This action is not a ``major rule'' as defined by 5 U.S.C. 804(2).
L. Petitions for Judicial Review
Under section 307(b)(1) of the Clean Air Act, petitions for
judicial review of this action must be filed in the United States Court
of Appeals for the appropriate circuit by June 14, 2010. Filing a
petition for reconsideration by the Administrator of this final rule
does not affect the finality of this rule for the purposes of judicial
review nor does it extend the time within which a petition for judicial
review may be filed, and shall not postpone the effectiveness of such
rule or action. This action may not be challenged later in proceedings
to enforce its requirements. See section 307(b)(2).
List of Subjects in 40 CFR Part 52
Environmental protection, Air pollution control, Carbon Monoxide,
Incorporation by reference, Intergovernmental relations, Lead, Nitrogen
dioxide, Ozone, Particulate matter, Reporting and recordkeeping
requirements, Sulfur oxides, Volatile organic compounds.
Dated: March 31, 2010.
Al Armendariz,
Regional Administrator, Region 6.
0
40 CFR part 52 is amended as follows:
PART 52--[AMENDED]
0
1. The authority citation for part 52 continues to read as follows:
Authority: 42 U.S.C. 7410 et seq.
Subpart SS--Texas
0
2. The table in Sec. 52.2270(c) entitled ``EPA-Approved Regulations in
the Texas SIP'' is amended by revising the entry for section 116.10 to
read as follows:
Sec. 52.2270 Identification of plan.
* * * * *
(c) * * *
EPA-Approved Regulations in the Texas SIP
----------------------------------------------------------------------------------------------------------------
State approval/
State citation Title/subject submittal date EPA approval date Explanation
----------------------------------------------------------------------------------------------------------------
* * * * * * *
Chapter 116 (Reg 6)--Control of Air Pollution by Permits for New Construction or Modification
----------------------------------------------------------------------------------------------------------------
Subchapter A--Definitions
----------------------------------------------------------------------------------------------------------------
Section 116.10................ General 8/21/2002 4/14/2010 [Insert FR The SIP does not
Definitions. page number where include paragraphs
document begins]. (1), (2), (3),
(7)(F), (11), and
(16).
* * * * * * *
----------------------------------------------------------------------------------------------------------------
0
3. Section 52.2273 is amended by designating the existing text as
paragraph (a) and by adding a new paragraph (b) to read as follows:
Sec. 52.2273 Approval status.
* * * * *
(b) EPA is disapproving the Texas SIP revision submittals as
follows:
(1) The following definitions in 30 TAC 116.10--General
Definitions:
(i) Definition of ``actual emissions'' in 30 TAC 116.10(1),
submitted March 13, 1996 and repealed and re-adopted June 17, 1998 and
submitted July 22, 1998;
(ii) Definition of ``allowable emissions'' in 30 TAC 116.10(2),
submitted March 13, 1996; repealed and re-adopted June 17, 1998 and
submitted July 22, 1998; and submitted September 11, 2000;
(iii) Portion of the definition of ``modification of existing
facility'' in 30 TAC 116.10(11)(E), submitted March 13, 1996; repealed
and re-adopted June 17, 1998 and submitted July 22, 1998; and submitted
September 4, 2002; and
(iv) Definition of ``qualified facility'' in 30 TAC 116.10(16),
submitted March 13, 1996; repealed and re-adopted June 17, 1998 and
submitted July 22, 1998; and submitted September 4, 2002;
(2) 30 TAC 116.116(e)--Changes at Qualified Facilities--submitted
March 13, 1996 and repealed and re-adopted June 17, 1998 and submitted
July 22, 1998;
(3) 30 TAC 116.117--Documentation and Notification of Changes to
Qualified Facilities--submitted March 13, 1996 and repealed and re-
adopted June 17, 1998 and submitted July 22, 1998;
(4) 30 TAC 116.118--Pre-Change Qualification--submitted March 13,
1996 and repealed and re-adopted June 17, 1998 and submitted July 22,
1998.
[FR Doc. 2010-8019 Filed 4-13-10; 8:45 am]
BILLING CODE 6560-50-P