TRANSCRIPT OF PROCEEDINGS 

HERITAGE REPORTING CORPORATION

Official Reporters

1220 L Street, N.W., Suite 600 

Washington, D.C. 20005-4018 

(202) 628-4888 

contracts@hrccourtreporters.com 

IN THE MATTER OF: 

 

PUBLIC HEARING ON ENVIRONMENTAL PROTECTION AGENCY (EPA) 

PROPOSED RULE: 

“IMPLEMENTATION OF THE NEW SOURCE REVIEW (NSR)PROGRAM FOR 

PARTICULATE MATTER LESS THAN 2.5 MICROMETERS (PM2.5); NOTICE OF 

PROPOSED RULEMAKING TO REPEAL GRANDFATHERING PROVISION AND 

END THE PM10 SURROGATE POLICY” 

(75 FR 6827, FEBRUARY 11, 2010) 

 

 

Pages: 1 through 43 

Place: Washington, D.C. 

Hearing Date: February 26, 2010 
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 UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

IN THE MATTER OF: 

 

PUBLIC HEARING ON ENVIRONMENTAL PROTECTION AGENCY (EPA) 

PROPOSED RULE: 

 “IMPLEMENTATION OF THE NEW SOURCE REVIEW (NSR) PROGRAM 

FOR PARTICULATE MATTER LESS THAN 2.5 MICROMETERS (PM2.5); 

NOTICE OF PROPOSED RULEMAKING TO REPEAL GRANDFATHERING 

PROVISION AND END THE PM10 SURROGATE POLICY” 

(75 FR 6827, FEBRUARY 11, 2010) 

 East Room 1153 

 1201 Constitution Avenue, N.W. 

 Washington, D.C. 

 Friday, 

 February 26, 2010 

 The parties met, pursuant to the notice, at 

1:07 p.m. 

 BEFORE: ANNA MARIE WOOD, Policy Analyst 

 Office of Air & Radiation, EPA 

 ATTENDEES: 

 ANNA MARIE WOOD, EPA 

 SCOTT JORDAN, EPA 

 DAN deROECK, EPA (via telephone) 

 TED STEICHENT, American Petroleum Institute 

 AARON FLYNN, Hunton & Williams LLP 

 CRAIG SEGALL, Sierra Club 

 KATE POLLARD, Sierra Club 

 BARBARA GOTTLIEB, Physicians for Social 

 Responsibility 

 MOLLY NEEL, Southern Utah Wilderness Alliance 

 DAVID BARON, Earthjustice 
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1 P R O C E E D I N G S

2 (1:07 p.m.) 

3 MS. WOOD: Good afternoon. My name is Anna 

4 Wood, and I'm with the Office of Air & Radiation here 

5 in Washington, D.C. I would like to welcome you to 

6 this public hearing on the proposal to repeal the 

7 grandfather provision for the PM2.5 and to end the PM10

8 surrogate policy. We look forward to hearing your 

9 comments and thoughts. 

10 I'm joined by my colleague, Scott Monrow, 

11 from our Office of General -- excuse me, I'm thinking 

12 of another Scott. I apologize, Scott. Scott Jordan 

13 from our Office of General Counsel, and unfortunately, 

14 due to bad weather in our North Carolina office, our 

15 folks from RTP were not able to get to Washington, but 

16 we do have them on the phone, and on the phone we have 

17 Dan deRoeck, who is a senior engineer working on this 

18 rulemaking in our Office of Air Quality Planning and 

19 Standards. 

20 I believe we have seven speakers scheduled 

21 to speak, and so what we're going to do is turn the 

22 proceeding over to Dan to make an opening statement, 

23 and then he will also talk about how the hearing will 

24 proceed, and then we'll proceed to have the speakers 

25 make their comments. Does that sound fine? Any 
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1 questions? Okay, great. Dan, can you hear us okay? 

2 MR. deROECK: Yes, I hear you fine. 

3 MS. WOOD: And hopefully folks can hear you. 

4 If not, we'll make some adjustments, but why don't you 

5 go ahead and get started. 

6 MR. deROECK: Okay, thank you. Again I 

7 apologize for not being there this morning. Our pilot 

8 decided to cancel the flight, but I appreciate Anna 

9 sitting in, and Scott Jordan is our legal assistant, 

10 our attorney on this project, and between us we are 

11 here to listen to your comments on this proposed rule. 

12 We may answer questions that seek to clarify what we 

13 proposed if you have any. But the general purpose of 

14 this hearing is to listen to your comments, not to 

15 discuss or debate the proposal. 

16 Before we move into the actual comment 

17 period I'd like to briefly describe the proposed rule 

18 that is the subject of today's hearing. 

19 Our proposal was published in the Federal 

20 Register on February 11. The proposal would revise 

21 the regulations concerning the prevention of 

22 significant deterioration or PSD program mandated by 

23 Part C of Title 1 of the act. 

24 Revisions involve two separate actions, one, 

25 to end the use of the PM10 surrogate policy. The first 
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1 action would repeal the grandfathering provision that 

2 is contained only in the federal PSD regulations under 

3 Part 40, C.F.R. Part 52. This is a grandfathering 

4 provision that is currently under a stay to June 22 of 

5 this year. 

6 The second proposed action would discontinue 

7 the use of the PM10 surrogate policy currently allowed 

8 in state PSD programs that are part of an EPA approved 

9 implementation plan. I'll describe both the 

10 grandfathering provision and the PM10 surrogate policy 

11 in more detail in just a moment. 

12 These actions are being taken in response to 

13 a petition to the administrator which sought 

14 reconsideration of four provisions of our May 16, 

15 2008, final rule implemented on new PM2.5 requirements 

16 under EPA’s various New Source Review regulations. 

17 The two actions being addressed today are two of the 

18 four challenged provisions. 

19 Following EPA's promulgation of National 

20 Ambient Air Quality Standards for PM2.5 in 1997, we 

21 issued guidance outlining our interim policy that 

22 major stationary sources applying for permits under 

23 the PSD program satisfy the requirement to show that 

24 the proposed source of emissions would not cause or 

25 contribute to a violation of the new National Air 
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1 Ambient Quality Standards for PM2.5 by demonstrating 

2 compliance with the National Ambient Air Quality 

3 Standards and PM10 increments for PM10. This policy has 

4 become known as the PM10 surrogate policy, and that has 

5 been in place in some form since 1997. 

6 It offers the surrogate approach for 

7 complying with the new PM2.5 standards until various 

8 technical issues involving monitoring, modeling and 

9 estimating PM2.5 emissions can be resolved by EPA. 

10 Now, in the May 16, 2008, rule that I 

11 referenced just a moment ago, we issued a final rule 

12 to revise various regulations to facilitate the 

13 implementation of the National Ambient Air Quality 

14 Standards for PM2.5. In that final rule, we ended the 

15 use of the PM10 surrogate policy under the federal PSD 

16 regulation. One exception, and that exception was the 

17 exception that I mentioned earlier, the grandfathering 

18 provision for any permit applied for but not yet 

19 received prior to the July 15, 2008, effective date of 

20 the final rule. It basically said that they could 

21 continue to be evaluated and issued on the basis of 

22 satisfying the PM10 requirements and therefore being 

23 grandfathered from the new requirements for PM2.5. 

24 I would note, however, that EPA did not 

25 propose for comment this grandfathering provision in 
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1 the final regulation that we included in the final 

2 rule. 

3 The final rule also allowed sources applying 

4 for permits under state PSD programs to continue using 

5 the PM10 surrogate policy during the three-year 

6 transition period until they submitted a revised 

7 implementation plan containing the new requirements 

8 for PM2.5 and received EPA's approval for that plan. 

9 On July 15, 2008, the National Resources 

10 Defense Council and the Sierra Club jointly petitioned 

11 the administrator to reconsider four provisions of the 

12 May 16, 2008 final rule. Two of those challenged 

13 provisions were the grandfathering provision and the 

14 continued use of the PM10 surrogate policy in state 

15 programs. 

16 In a letter dated January 5, 2009, EPA 

17 denied this petition. However, on February 10, 2009, 

18 the petitioner submitted a second petition similar to 

19 the first to the new Administrator. In response to 

20 the second petition, EPA issued a letter on April 24, 

21 2009, granting the second petition, agreeing to 

22 reconsider all four of the challenged provisions. 

23 EPA indicated in the letter that it intended 

24 to propose repealing the grandfathering provision, and 

25 I quote, "on the grounds that it was adopted without 
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1 prior public notice and is no longer substantially 

2 justified in light of the resolution of the technical 

3 issues with respect to PM2.5 monitoring, emissions 

4 estimation and air quality modeling that led to the 

5 PM10 surrogate policy in 1997." 

6 And secondly, it was administratively 

7 staying the grandfathering provision for three months8 - the maximum period allowed for an administrative 

9 stay. 

10 The administrative stay on the 

11 grandfathering provision became effective on June 1, 

12 2009, the date it was announced in the Federal 

13 Register. It ended on September 1, 2009. In order to 

14 allow additional time to analyze this rulemaking, EPA 

15 proposed and promulgated a second stay, this one a 

16 nine-month stay, separate from the administrative stay 

17 and lasting until June 22, 2010. 

18 They agreed to reconsider the grandfathering 

19 provision primarily on the grounds they failed to 

20 propose the provision for public comment prior to 

21 taking final action. However, we are proceeding on 

22 our proposal to repeal the grandfathering provision in 

23 the federal PSD regulations to discontinue the use of 

24 the PM10 surrogate policy in state PSD programs based 

25 on our current belief that the PM2.5 issues that led to 
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1 the adoption of the PM10 surrogate policy has now been 

2 largely resolved. Hence, we believe that permitting 

3 authorities and the regulated community now have 

4 sufficient tools to conduct a meaningful permit5 related PM2.5 analysis. 

6 It's important to note that the two proposed 

7 actions are separate and independent. In proposing to 

8 end the use of the PM10 surrogate policy in state PSD 

9 programs before the end of the three-year transition 

10 period for revising these programs, we solicited 

11 comment on what legal authority issues for 

12 implementing the new PM2.5 requirement could result for 

13 states with approved PSD programs. 

14 We also sought comments on what 

15 implementation difficulties for state permitting 

16 authorities or PSD applicants could result from 

17 discontinuation of the PM10 surrogate policy. 

18 Finally, we invited comment on any other 

19 points that interested parties believe are relevant, 

20 and whether the PM10 surrogate policy continues to be 

21 necessary for implementing the Clean Air Act's 

22 requirements for PM2.5. 

23 Now let me outline the way we'll run this 

24 forum. Scott or Anna, I'm not sure which one, I guess 

25 Anna, will call the speakers to the microphone in the 
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1 order that they have registered, and due to the small 

2 number of registered speakers, I believe we have six 

3 or so right now, we will not restrict speaker 

4 testimony to five minutes as is our normal practice. 

5 We do however ask that the speakers limit their 

6 testimony to 10 minutes or less, and once a speaker 

7 completes his or her oral statement, Anna may ask the 

8 speaker clarifying questions. 

9 Each speaker's oral testimony will become 

10 part of the official record of the rulemaking. Please 

11 be sure to give a copy of any written comments that 

12 you have to our staff at the registration table. We 

13 will continue until up to one hour after the 

14 registered speaker has spoken. If there is anyone in 

15 the audience who would like to testify but has not yet 

16 registered, please sign up at the registration table. 

17 We will prepare a written transcript of 

18 today's hearing. Transcripts will be available as 

19 part of the official record for this rulemaking 

20 process, and in conjunction with this hearing, we are 

21 accepting written comments related to this hearing 

22 until March 29, 2010. You have a handout available on 

23 the registration table with detailed information to 

24 submit any written comment on this proposed rule and 

25 this hearing. 
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1 Again, I'd like to thank you for your 

2 participation. I'm sorry I cannot be there. We 

3 appreciate your attendance and participation, and I'll 

4 turn it over to Anna to start the process for 

5 presenting the speakers. Thank you. 

6 MS. WOOD: Thank you, Dan. 

7 The first speaker is Ted Steichent from 

8 American Petroleum Institute. Mr. Steichent. 

9 Can you hear, Dan? 

10 MR. deROECK: I heard something. 

11 MS. WOOD: Okay, we're making an adjustment 

12 on the microphone so the reporter can hear. 

13 (Pause.) 

14 MR. STEICHENT: Does this work? 

15 MS. WOOD: Yes. 

16 MR. STEICHENT: Okay. All right, very good. 

17 I left copies of my testimony on the 

18 counter. Do you want me to get them for you? 

19 MS. WOOD: No, just go ahead and proceed. 

20 We'll be able to get it afterwards. 

21 MR. STEICHENT: Okay, very good. 

22 MS. WOOD: Thank you. 

23 MR. STEICHENT: Good afternoon. My name is 

24 Ted Steichent. I'm a policy advisor at the American 

25 Petroleum Institute, which is a trade association that 
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1 represents about 400 members of companies involved in 

2 all aspects of the oil and gas industry. 

3 I'm here to testify on the proposed repeal 

4 of the grandfathering provisions and termination of 

5 the PM10 surrogacy policy for implementation of the new 

6 Source Review Program for PM2.5. Today I will address 

7 the major points that we intend to include in our 

8 written comments, which will be more detailed and 

9 filed before the comment record closes. 

10 EPA states in their proposed rule that it 

11 will affect two categories of entities. First, it 

12 will affect sources that have submitted and have 

13 completed applications for PSD permits before the July 

14 deadline but have not yet received the final PSD 

15 permit, and second, it will affect sources that are 

16 located in approved states that are implementing the 

17 PM10 surrogate policy. 

18 EPA has stated that there is a very limited 

19 number of facilities that fall into the first 

20 category. However, given the number of SIP-approved 

21 states and EPA backlog on approving the PSD revisions, 

22 however, the potential reach of this action in those 

23 areas is considerable and is likely to adversely 

24 affect API member companies. 

25 Moreover, the precedent that EPA would be 
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1 suggesting that it has such limited authority in this 

2 circumstance to create reasonable transition policies 

3 when a new NAAQS is developed could have significant 

4 future adverse effects on our members. Today I will 

5 focus on three key points: 

6 One, the legal authority and appropriateness 

7 of providing reasonable transition provisions when an 

8 ambient air quality standard is issued or revised; 

9 two, the effects the termination of that particular 

10 transition policy on sources in SIP-approved states; 

11 and three, the need for EPA to issue an approved test 

12 method. 

13 First, EPA states in their proposal that 

14 recent case law suggests its authority to provide a 

15 transition policy when new or revised ambient air 

16 quality standards are issued is more limited than is 

17 in fact the case. The proposal cites in large part to 

18 cases that relate to using one pollutant as a 

19 surrogate for another on a permanent basis under the 

20 Section 112 provisions. However, these decisions are 

21 not applicable to the temporary transition rule, such 

22 as the PM10 surrogacy policy. Congress's provision of 

23 a three-year period to adopt SIPs under the Act 

24 provides clear indication that the transition policies 

25 are permissible in these circumstances. 
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1 From a policy perspective, it is critical 

2 for both sources and states to be provided with a 

3 transition period before the entirety of the PSD 

4 requirements become applicable following the issuance 

5 of a new NAAQS. EPA has always maintained such a 

6 policy and for good reasons. For example, 

7 significance levels, increment levels, significant 

8 monitoring concentrations and test methods must be 

9 established so that the regulated entities can ensure 

10 compliance with the requirements. 

11 Second, EPA recognizes in the proposal that 

12 if the agency terminates the PM10 surrogacy policy 

13 before it approves significance levels and SIPs, 

14 sources in those states could be subject to a zero-ton 

15 significance level as compared to the 10-ton limit 

16 that is applicable in the designated states now. A 

17 zero significance level would create a massive burden 

18 on state agencies and businesses. 

19 This transition policy has been in effect in 

20 state-approved states for PM10 and has been used as a 

21 surrogate for PM2.5 in determining the applicability of 

22 PSD. While many states have adopted a separate PM2.5

23 significance level since the issuance of the 

24 implementation rule, EPA has not acted on all of those 

25 submittals. If EPA elects to terminate the transition 
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1 policy in SIP-approved states, it is important that 

2 the agency first act on the significance levels in any 

3 SIP submitted that has been received. 

4 To shed light on the scope of this concern, 

5 we request that EPA provide to the docket before the 

6 close of comment period a list of states that have 

7 submitted SIPs before approval that includes a PM2.5

8 significance level but which EPA has yet to act. 

9 And third, it is important that EPA complete 

10 development of a commercial test method and issue a 

11 final test method for fine particulates. Such a 

12 method does not exist for all sources; in particular, 

13 there is no commercial test method for measuring 

14 condensables in wet stack such as refinery FCC use 

15 with wet gas scrubber pollution-control devices. The 

16 delay in issuing revised methods creates uncertainty 

17 and instability in the process, and we urge EPA to 

18 move quickly to issue one in a final form. 

19 Additionally, we support EPA's proposal that 

20 the repeal would not apply retroactively to permits 

21 that have already been issued. It is critical to 

22 provide certainty to the existing permit appeal 

23 process and it is consistent with the requirements of 

24 both state and federal rules that appeals be brought 

25 by specified statutory deadlines, and I thank you for 
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1 your attention with my comments. 

2 MS. WOOD: Thank you, Mr. Steichent, for 

3 your comments. 

4 MR. STEICHENT: Okay, there are no 

5 questions? 

6 MS. WOOD: Oh, are there any clarifying 

7 questions? Yes, we don't have any I don't believe. 

8 MR. STEICHENT: Okay. Thank you. 

9 MS. WOOD: Dan, pipe in? Do you? 

10 MR. deROECK: I just want to clarify that 

11 the significance level he's talking about is the 

12 significant emissions rate. 

13 MS. WOOD: Okay. 

14 MR. deROECK: I'm asking if -- 

15 MS. WOOD: That's a question, Mr. Steichent. 

16 Do you want to restate your question, Dan, please? 

17 MR. deROECK: Is the significance level that 

18 he's referring to the significant emissions rate in 

19 PM2.5? 

20 MR. STEICHENT: In tons per year, yes. 

21 MS. WOOD: Any other clarifying questions? 

22 Okay, thank you, Mr. Steichent. 

23 Our next speaker is Aaron Flynn from Hunton 

24 & Williams, and let's try that mic, and if it's not 

25 working properly, then we'll go to this, but maybe 
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1 we'll turn it around so it's a bit less awkward for 

2 you. Let's see what that does. I don't know if they 

3 turned it down or what. 

4 Hey, Crystal, Crystal, can we turn this 

5 around so it's a little bit less awkward? 

6 MR. JORDAN: The podium here with the mic on 

7 it? 

8 (Pause.) 

9 MS. WOOD: Okay. Thank you. 

10 MR. FLYNN: Good afternoon. My name is 

11 Aaron Flynn and I am -- 

12 MS. WOOD: You might want to get closer yet 

13 so we can hear you better. Thank you. 

14 MR. FLYNN: Does that work better? 

15 MS. WOOD: I think so. 

16 MR. FLYNN: Okay, great. My name is Aaron 

17 Flynn and I am an attorney with the law firm of Hunton 

18 & Williams LLP, and I appreciate the opportunity to 

19 speak with you today on behalf of my client, the 

20 Utility Air Regulatory Group or UARG. 

21 UARG is an ad hoc voluntary, not-for-profit 

22 group of electric-generating companies and 

23 organizations and national trade associations. UARG's 

24 purpose is to participate collectively on behalf of 

25 its members in EPA's rulemakings and other proceedings 
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1 under the Clean Air Act that affect the interests of 

2 electric utilities and generators and to participate 

3 in litigation arising from those proceedings. 

4 UARG has participated extensively in EPA 

5 rulemakings and litigation concerning implementation 

6 of the National Ambient Air Quality Standards under 

7 the Clean Air Act, including implementation of New 

8 Source Review requirements for EPA's particulate 

9 matters standards, which is the subject of today's 

10 hearing. 

11 For example, UARG participated in EPA's 

12 rulemaking that resulted in the establishment in 2008 

13 of new Source Review implementation rules for the fine 

14 PM standards. UARG is also an intervenor in support 

15 of EPA in pending litigation brought against the 

16 agency by two environmental organizations that are 

17 challenging certain provisions of those rules. 

18 In addition, UARG submitted detailed 

19 comments on EPA's rulemaking last year on a revision 

20 to the 2008 rules to stay the effectiveness of the so21 called PM2.5 permit grandfathering provision. That 

22 rulemaking culminated in the issuance in September 

23 2009 of a final rule staying the grandfathering 

24 provision for nine months, an action designed to give 

25 EPA time to conduct the present rulemaking to repeal 
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1 the provision all together. 

2 Unfortunately, in adopting the final stay 

3 rule in September, EPA overlooked comments, including 

4 comments submitted by UARG that opposed the proposed 

5 stay. In litigation filed in the U.S. Court of 

6 Appeals for the D.C. Circuit by UARG and others 

7 challenging the final stay rule, EPA has acknowledged 

8 that those comments were timely submitted and that it 

9 failed to meet its obligation to respond to them, and 

10 although EPA has known of the comments for several 

11 months, it still has issued no response and its motion 

12 for a remand of the record is now pending before the 

13 Court. 

14 UARG's August 2009 comments on the proposed 

15 stay show, among other things, that EPA lacks any 

16 valid basis for concluding at this time that the 

17 technical impediments to measuring and modeling PM2.5

18 emissions that gave rise to the PM10 surrogate policy 

19 have in fact been resolved. Thus, in UARG's view, EPA 

20 has no grounds for staying or repealing the 

21 grandfathering provision or for terminating the PM10

22 surrogate policy. 

23 Nonetheless, EPA earlier this month signed 

24 and on February 11 published its proposed rule to 

25 repeal the grandfathering provision and to end early 
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1 the PM10 surrogate policy. This proposed rule includes 

2 no response to or acknowledgement of UARG's earlier 

3 comments or other comments that opposed the stay. It 

4 remains unclear at this point when EPA will respond to 

5 those comments. 

6 UARG wants today to take this opportunity to 

7 urge EPA to respond to those earlier comments as soon 

8 as possible and to allow UARG and other commentors 

9 enough time to consider EPA's response to those 

10 comments in developing our comments on the February 11 

11 proposed rule revisions. Those earlier comments are 

12 plainly relevant to EPA's proposal to revoke the PM10

13 surrogate policy by repealing the grandfathering 

14 provision and ending prematurely SIP-approved states' 

15 longstanding authority to use the surrogate policy. 

16 In its recent court filings, EPA has 

17 suggested it believes the result of its 2009 

18 rulemaking on the stay would not have been different 

19 if EPA had considered and responded to those comments. 

20 Thus EPA has already indicated that it has in effect 

21 rejected those comments while conceding that it has 

22 unlawfully failed to state its reasons for doing so. 

23 This denies UARG information necessary for preparation 

24 of full and meaningful comments on the February 11 

25 proposed rule. 
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1 In light of the information that is 

2 available at the time when written comments must be 

3 submitted, however, UARG's comments on the February 11 

4 proposal will in any event address the impediments to 

5 removal of the PM10 surrogate policy. 

6 I would also like to note briefly a related 

7 point that UARG's written comments may address in more 

8 detail. The background section of EPA's February 11 

9 proposal describes the reinterpretation of the PM10

10 surrogate policy in light of certain caselaw that EPA 

11 cites as reflecting a judicial policy on the use of 

12 surrogates. In fact, EPA has relied on this new view 

13 of the PM10 surrogate policy recently in acting on 

14 certain petitions to object to Title 5 permits. 

15 This new view is that, as EPA puts it in the 

16 preamble, permit applicants and permitting authorities 

17 seeking to apply the 1997 PM10 surrogate policy must 

18 ensure that the record for each permit supports using 

19 PM10 as a surrogate for PM2.5 under the circumstances. 

20 Even if this novel view were reconcilable 

21 with the PM10 surrogate policy itself, which is a 

22 debatable proposition at best, we do not see how that 

23 view could be squared with the 2008 rules. Those 

24 rules impose no requirement to justify use of PM10 as a 

25 surrogate under the circumstances of a particular case 
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1 either for permit applications subject to the 

2 grandfathering provision or for permit applications in 

3 SIP-approved states during the rule's three-year 

4 transition period. 

5 The 2008 rule's authorization for SIP6 approved states to use the PM10 surrogate policy is 

7 without qualification and without any obligation to 

8 make or require case-by-case justifications, and that 

9 remains in effect at this time, and EPA of course 

10 remains legally bound to follow its own rules unless 

11 and until it changes them through proper and lawful 

12 procedures in a way that complies with the 

13 requirements of the Clean Air Act. 

14 Thank you for your attention and thank you 

15 in advance for considering these comments, and I'm 

16 happy to respond to any questions. 

17 MS. WOOD: Thank you, Mr. Flynn. 

18 Do you have any clarifying questions? Dan, 

19 anything? 

20 MR. deROECK: No, I have none. 

21 MS. WOOD: Okay, thank you so much. 

22 MR. FLYNN: Thank you. 

23 MS. WOOD: Our next speaker is Craig Segall 

24 from the Sierra Club. 

25 MR. SEGALL: Hi. Thanks for having us. My 
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1 name is Craig Segall. I'm an attorney with the Sierra 

2 Club Law Program. We work a lot with our Big Picture 

3 Campaign, which is dedicated to working with EPA on 

4 rulemakings affecting clean air and climate. 

5 On behalf of the Sierra Club's 1.3 million 

6 members and supporters we are very glad to see you 

7 taking this step today. It's long overdue and 

8 desperately needed. On behalf of the many of our 

9 members who suffer from respiratory ailments and heart 

10 problems associated with PM2.5 pollution, we're deeply 

11 appreciative. 

12 I have a few points to make regarding the 

13 surrogate policy generally and grandfathering and 

14 EPA's obligations here. 

15 I think the first thing to say is that in 

16 many ways this is long overdue. Under the Clean Air 

17 Act, the states had three years after the initial 

18 promulgation of the PM2.5 policies in 1997 to submit 

19 compliance steps, so at minimum this should have been 

20 done by 2000. When the new NAAQS came out in 2005, it 

21 should have been done by 2008, and it was in fact 

22 required to have been done then. It's also true under 

23 the act that EPA has no discretion to waive or 

24 grandfather any permits at all under the federal 

25 program. So it's about time to see that change. 
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1 As to the particular surrogate policy 

2 itself, it's illegal for several reasons, and I think 

3 it's time to see it go. The first core issue here is 

4 under a long established D.C. Circuit law, National 

5 Lime Association, among other cases, surrogates can 

6 only be used if they can reasonably be used. This 

7 surrogate policy can't reasonably be used, in fact it 

8 never could be for both technical and straight legal 

9 reasons. 

10 On the technical side, it's been clear 

11 really since 1997 that PM2.5 and PM10 are not surrogates 

12 for each other. PM2.5 behaves differently both with 

13 regard to health impacts and emission impacts and with 

14 regard to control technologies used to control it. 

15 Moreover, if there was any excuse ever on 

16 measurement grounds as was raised in the 1997 NAAQS 

17 and the SIP's memo, that's long passed and EPA 

18 acknowledges it's long passed, so that also doesn't 

19 justify it, but more fundamentally the PM2.5 NAAQS were 

20 adopted specifically because the PM10 NAAQS weren't 

21 getting the job done. They can't substitute for each 

22 other because they serve different purposes, address 

23 different pollutants and as a legal matter therefore 

24 can't be interchangeable. 

25 Moreover, and I think this is just core 
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1 intuition, there is no annual NAAQS for PM10. It's 

2 baffling that compliance with the PM10, you know, the 

3 24-hour NAAQS could possibly be a surrogate for an 

4 annual PM2.5 NAAQS. 

5 So we just see no justification for this 

6 policy to continue, and moreover, no legal possibility 

7 of allowing states to continue with this policy, so 

8 the portion of the notice that suggests that there may 

9 be implementation issues here, we think, is really 

10 misplaced. To the extent that states do have problems 

11 in funding this, EPA's remedy is clear, which is to 

12 take over the program and administer it federally. 

13 I want to speak a bit in part because UARG's 

14 comments raised this as to EPA's more recent efforts 

15 to implement the surrogate policy and deal with 

16 whether or not this is a reasonable approach. We're 

17 most familiar with this through the Title 5 objection 

18 to the LG Trimble plant, which issued last year, where 

19 EPA objected on those grounds, and I think it's worth 

20 saying that, even in the wake of that objection, the 

21 states still for the most part aren't getting the job 

22 done. There really is a core need for EPA leadership 

23 on this issue. 

24 I've brought with me a series of comment 

25 documents and permit documents to demonstrate this, 
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1 and I'll just briefly note what they are and then hand 

2 them over for the record. 

3 In Medicine Bow, which is a coal-liquid 

4 plant in Wyoming, the Wyoming Environmental Council 

5 continues to insist that it simply does not have to 

6 demonstrate any sort of reasonableness compliance 

7 under the PM10 surrogate policy. It just refuses to go 

8 forward with it. 

9 The same is true in Mississippi for the 

10 Kenford plant, which is I believe an IGCC coal plant. 

11 Again, we are arguing with them over whether or not 

12 PM10 can be a surrogate for PM2.5. They again ignore 

13 Trimble, discount it as irrelevant, and discount the 

14 National Lime case as irrelevant. 

15 The same thing is true, fairly remarkably, 

16 in the Trimble case. A revised permit has come out. 

17 We submitted comments, and in response to comments, 

18 the Kentucky Division of Air Quality at great length 

19 explains that it simply is not bound, any 

20 reasonableness determination can carry on using PM10 as 

21 fact analysis for these plants. 

22 So even were the surrogate policy ever 

23 acceptable, it's clearly not been implemented in any 

24 way that even bears an item of resemblance to the core 

25 reasonableness dictates that EPA has tried to 
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1 implement through the Title 5 program. We think it 

2 needs to end immediately. We think it's a core public 

3 health imperative, and we want to see you do it. 

4 And frankly, it's past time. So thank you. 

5 I'll pass these over. Appreciate the time. 

6 MS. WOOD: Thank you, Mr. Segall. Any 

7 clarifying questions? 

8 Next we have Barbara Gottlieb from 

9 Physicians for Social Responsibility. 

10 MS. GOTTLIEB: Hello. Good afternoon. I'm 

11 Barbara Gottlieb, Deputy Director for Environment and 

12 Health at Physicians for Social Responsibility. 

13 We're a national organization representing 

14 50,000 health professionals, concerned citizens and 

15 activists, with 31 chapters and over 60 medical 

16 student chapters across the United States. We 

17 appreciate the opportunity to present our comments on 

18 the health impacts of particulate matter, especially 

19 the distinction between PM2.5 and PM10. I'm also 

20 delighted to be able to represent the health 

21 profession here today. I think I may be the only non22 lawyer speaking, so thank you again. 

23 Particulate matter refers to extremely small 

24 airborne particles whose major sources are from coal 

25 combustion, traffic, and residual oil combustion. 
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1 Particulates were categorized as coarse particulate or 

2 PM10 with a diameter of more than 2.5 up to 10 microns, 

3 and as fine particulate, or PM2.5 with a diameter less 

4 than 2.5 microns. By comparison, the human hair is 

5 about 70 microns in diameter. 

6 EPA issued National Ambient Air Quality 

7 Standards for PM2.5 in 1997 and strengthened them in 

8 2006. Unfortunately, from PSR's perspective, EPA 

9 undermined its own rules by permitting the use of 

10 coarse particulate matter, or PM10, as a surrogate for 

11 PM2.5. We would submit that that substitution is 

12 entirely inappropriate for protecting human health. 

13 Fine particulate matter--not coarse 

14 particulates--must be the form that is monitored due 

15 to the differences in the ways and the extent to which 

16 the smaller 2.5 particulates enter the human body. 

17 We know already that PM2.5 impacts all the 

18 major body organ systems, the respiratory, the 

19 cardiovascular and the neurological, and is associated 

20 with illnesses and premature death. In fact, the 

21 association between daily concentrations of airborne 

22 PM2.5 particles and daily deaths has been long known and 

23 long scientifically documented. As far back as 1996, 

24 Schwartz et al. published findings showing that daily 

25 mortality was associated specifically with fine 
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1 particles, with 2.5 and not with coarse particulate 

2 matter. 

3 In order to understand why it's urgent to 

4 monitor and regulate PM2.5, we need to appreciate the 

5 mechanism by which it does so much more harm than PM10. 

6 Small particles of particulate matter, specifically 

7 those that are 2.5 microns or less in diameter, travel 

8 deep into the lungs, reaching the alveoli. I think we 

9 all know from our familiarity with lung cancer that as 

10 toxic particles lodge in the lungs they can cause 

11 cancer, and that is in fact the case with PM2.5. 

12 However, the threat from PM2.5 goes well 

13 beyond that. These particles, the 2.5 particles, are 

14 so tiny that once in the alveoli they can enter 

15 directly into the vascular compartment and travel 

16 through the bloodstream to other body organs. As a 

17 result, not only the respiratory system but also the 

18 cardiovascular system and the neurological system can 

19 be subject to direct damage. 

20 I would like to mention just briefly some of 

21 PM2.5's impact on the human body. In the respiratory 

22 system, PM2.5 adversely affects lung development. It 

23 can stunt lung development, leading to reduced lung 

24 function as measured by forced expiatory volume. This 

25 reduction in FEV, which is a major indicator of lung 
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1 function, often precedes the subsequent development of 

2 other pulmonary diseases. 

3 PM2.5 is associated with chronic obstructive 

4 pulmonary disease. In fact, in a study of 

5 hospitalization rates among Medicare enrollees, a 10 

6 micrograms per cubic meter increase in the 

7 concentration of PM2.5 particles was associated with a 

8 same day increase of 2.5 percent in hospital 

9 admissions for COPD. Exposure to PM is also 

10 correlated with the development of and mortality from 

11 lung cancer, as I mentioned earlier. It's the leading 

12 cancer killer in men and women. 

13 In the neurological system, fine particles 

14 are associated with cerebrovascular disease or stroke. 

15 Again, in a study of Medicare patients, ambient levels 

16 of PM2.5 have been correlated with hospital admission 

17 rates for cerebrovascular disease. PM2.5 has also been 

18 associated with an increase in the risk of and death 

19 from cerebrovascular events among postmenopausal 

20 women. 

21 In the cardiovascular system, the 

22 concentration of PM2.5 in ambient air increases the 

23 probability of hospital admission for acute myocardial 

24 infarction, known to most of us as heart attack, 

25 ischemic heart disease and congestive heart failure. 
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1 Recent research suggests that PM2.5, along with other 

2 pollutants, is associated with hospital admissions for 

3 potentially fatal cardiac rhythm disturbances. 

4 The increases of rate in these concerns may 

5 appear small, they're often on the order of about 1 

6 percent, however it's the large number of cases, 

7 especially of heart disease, that translates these 

8 results into a very large effect when measured in 

9 terms of total hospital admissions, patient morbidity, 

10 patient mortality and in addition the cost of health 

11 care and lost opportunities. 

12 In short, the danger to health that is posed 

13 specifically by PM2.5 is widespread, severe and costly. 

14 Ambient concentrations of PM2.5 must be monitored and 

15 the exposure to these dangerous airborne pollutants 

16 must be reduced. We have seen in the past that 

17 reductions in PM2.5 concentration, as has been witnessed 

18 in 51 metropolitan areas, were correlated with 

19 significant increases in life expectancy. 

20 Additional air quality improvements in 

21 regard to fine particulate pollution are an important 

22 aspect of improving respiratory, cardiovascular and 

23 neurological health for the population at large. 

24 Given the EPA's responsibility to protect human health 

25 and well-being, we respectfully request that the EPA 
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1 repeal the grandfathering provision for PM2.5 contained 

2 in the federal program and the PM10 surrogate policy in 

3 the relevant states. 

4 Thank you very much. 

5 MS. WOOD: Thank you, Ms. Gottlieb. Are 

6 there any clarifying questions? Thank you so much for 

7 your comments. 

8 Our next speaker is Molly Neel with Southern 

9 Utah Wilderness Alliance. 

10 MS. NEEL: Hello. I'm Molly Neel here on 

11 behalf of the Southern Utah Wilderness Alliance, and 

12 we are a conservation group focused on protecting the 

13 canyon lands at the heart of the Colorado Plateau 

14 there. So, I'm going to discuss why we think that the 

15 surrogate policy needs to be rescinded and the effects 

16 that is having on the environment there and a little 

17 case study. 

18 We believe that the EPA should rescind its 

19 surrogate policy. This policy has led to 

20 misunderstanding on the part of another federal 

21 agency, the Bureau of Land Management or the BLM. 

22 Unfortunately, the BLM has relied on the surrogate 

23 policy to authorize pollution-generating activities on 

24 public lands that ignore the impacts of PM2.5--even 

25 where monitored data have shown levels of concern to 
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1 human health and the environment. 

2 This practical outcome demonstrates that 

3 EPA's surrogate policy needs to be rescinded. The BLM 

4 manages significant portions of public land in the 

5 western United States. BLM lands are managed for 

6 multiple uses, which means that the BLM often approves 

7 large-scale gas and oil development on public lands, 

8 as well as extensive networks of dirt roads open to 

9 vehicular traffic. 

10 As part of this approval process, the BLM 

11 must evaluate the impacts of these projects on air 

12 quality in relation to the federal air quality 

13 standards such as the National Ambient Air Quality 

14 Standards or NAAQS and increment limits for the 

15 prevention of significant deterioration. 

16 Oil and gas projects on BLM lands can 

17 produce significant amounts of pollution, including 

18 particulate matter. Despite this fact, the BLM has 

19 prepared analyses of large oil and gas development 

20 projects that have only evaluated PM2.5 through the 

21 proxy of PM10. This justification for this sort of 

22 modeling is apparently derived from or encouraged by 

23 the surrogate policy. The BLM seems to feel that 

24 because EPA does not require the direct consideration 

25 of PM2.5 under its New Source Review requirements that 
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1 the BLM is excused from modeling this pollutant when 

2 evaluating various welling projects on public lands. 

3 An example from the Uintah Basin of Utah 

4 demonstrates why such proxy modeling can be 

5 inappropriate and harmful. The Uintah Basin is a high 

6 elevation basin surrounded by a higher elevation 

7 plateau to the south and Utah's highest mountain range 

8 to the north. It is also the primary oil and gas9 producing region of the state. The Uintah Basin is 

10 subject to wintertime temperature inversions, which 

11 allow unhealthy levels of PM2.5 to build. 

12 In fact, during the last three winters 

13 monitors have recorded significant exceedances of 

14 NAAQS 24-hour average maximum value for PM2.5. Between 

15 January and February of 2007, a monitor from the Utah 

16 Division of Air Quality recorded five different values 

17 exceeding the NAAQS 24-hour average maximum of 35 

18 micrograms per cubic meter for PM2.5. In 2008, 

19 monitoring was conducted in the Uintah Basin only 

20 during February and March, yet one exceedance was 

21 still observed. In 2009, the Utah Division of Air 

22 Quality operated two monitors from January 21, 2009, 

23 through March 5, 2009, that observed four exceedances 

24 in one location of the Uintah Basin and three 

25 exceedances in another location. 
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1 Clearly, the Uintah Basin is a place where 

2 PM2.5 pollution should be a significant concern, likely 

3 because of secondary particulate formation. However, 

4 it is not so clear that the Uintah Basin is also 

5 experiencing unhealthy levels of PM10 pollution in 

6 relation to NAAQS. For this reason, the BLM should 

7 model PM2.5 independently while accounting for secondary 

8 formation and not simply express this pollution as a 

9 ratio of PM10. 

10 These sorts of efforts should be replicated 

11 on BLM Lands in other regions, too. If the EPA were 

12 to rescind its surrogate policy, the BLM would 

13 probably shy away from these inappropriate practices 

14 throughout all of the West. In addition to the other 

15 rationales people have expressed for rescinding the 

16 surrogate policy, the BLM's misguided reliance on this 

17 policy for inadequate modeling should also spur the 

18 EPA to action. Please rescind the surrogate policy. 

19 Thank you. 

20 MS. WOOD: Thank you, Ms. Neel. Any 

21 clarifying questions? 

22 Our next speaker is David Baron with 

23 Earthjustice. 

24 MR. BARON: Thank you. My name is David 

25 Baron. I'm managing attorney of the Washington, D.C. 
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1 office of Earthjustice. We are counsel to Natural 

2 Resources Defense Council and Sierra Club in the 

3 petition for administrative reconsideration that led 

4 to this rulemaking. 

5 We strongly support EPA's proposal to put an 

6 immediate end to the surrogate policy. That policy is 

7 illegal and irrational and, by eliminating it, EPA 

8 will not only give a breath of fresh air to all of us 

9 but correct a huge injustice that's been allowed to 

10 continue for far too long. 

11 Almost 13 years ago EPA found that the PM10

12 standard was not sufficient to protect the health and 

13 welfare of our citizens and that an additional 

14 standard to limit fine particles was necessary to 

15 prevent tens of thousands of premature deaths and 

16 other health effects every year. And, since then, the 

17 evidence has become even stronger. 

18 In 2006, EPA based on that evidence 

19 strengthened the PM2.5 standard even further, and even 

20 then the D.C. Circuit, in a challenge brought by the 

21 American Lung Association and others, determined that 

22 the Agency may well not have gone far enough in 

23 strengthening the PM2.5 standard. 

24 Yet, under the surrogate policy the states 

25 and EPA have allowed huge new factories and power 
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1 plants to belch out tons of fine particle pollution 

2 without applying the best available control technology 

3 to limit that pollution and without even looking at 

4 the impacts of that pollution on compliance with fine 

5 particle health standards. 

6 It is nothing less than a travesty that 

7 today, 13 years after it was determined that the PM10

8 standard was not sufficient to protect our lungs and 

9 our health, we are still allowing huge new factories 

10 and power plants to be built without even limiting the 

11 impact of that pollution to ensure compliance with 

12 those standards. 

13 And, in response to the earlier comment from 

14 the American Petroleum Institute that we need a 

15 transition period, we have had 13 years, 13 years to 

16 transition to this standard. It should not be a 

17 surprise to anyone anywhere that the time has long 

18 since passed for us to be requiring all of these 

19 industries to comply with standards that we all know 

20 are necessary to protect human health. 

21 So EPA is absolutely right to propose 

22 getting rid of this surrogate policy, and it's legally 

23 required to do so. The Clean Air Act requires each 

24 new major PSD source to show that it will not cause or 

25 contribute to violation of any National Ambient Air 
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1 Quality Standard, and that it will apply the Best 

2 Available Control Technology to each, "each" pollutant 

3 subject to regulation under the act. 

4 Furthermore, there is no technical support 

5 or rational basis for treating PM10 as a surrogate for 

6 PM2.5. There isn't now, and there never has been; it 

7 was never presented in the record and our industry 

8 friends act as though it should be a given when in 

9 fact it was never justified, and it is not justified 

10 today. 

11 It's particularly outlandish to suggest that 

12 a 24-hour PM10 standard should somehow be a surrogate 

13 for compliance with an annual PM2.5 standard. The 

14 controls aren't the same, the pollutants aren't 

15 identical, the nonattainment areas, the areas that 

16 violate these standards are not even congruent. 

17 They're areas that violate one but not the other. The 

18 only rationale that EPA ever gave for this policy had 

19 to do with technical issues on monitoring and 

20 modeling, both of which have been resolved. We now 

21 have hundreds of PM fine monitors all over the 

22 country, we know how to model for PM10 impacts or PM2.5

23 impacts, so there is no excuse to continue this policy 

24 and it needs to be put to an end immediately. 

25 Now, EPA has asked for comment on the 
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1 potential implementation difficulties of immediately 

2 revoking the surrogate policy in SIP-approved states. 

3 With all due respect, that simply isn't a relevant 

4 inquiry. There is no legal authority to apply this 

5 policy anywhere and EPA doesn't have the option of 

6 allowing its continued use based on implementation 

7 concerns. If SIP-approved states don't feel they can 

8 implement this PSD program legally, they can let EPA 

9 do it until they are ready to do so. 

10 The surrogate policy allows people to be 

11 exposed to dangerous and sometimes life-threatening 

12 levels of pollution from new factories and power 

13 plants. It needs to be put to an end. We applaud 

14 EPA's proposal to do so. 

15 Thank you for the opportunity to speak. 

16 MS. WOOD: Thank you, Mr. Baron, for your 

17 comments. Any clarifying questions? 

18 Our last registered speaker is Kate Pollard 

19 from the Sierra Club. 

20 Mr. Segall, do you know if she is going to 

21 come? 

22 Okay. Ms. Pollard isn't here. I know we 

23 remain here for an hour after, so if she shows up 

24 late, we'll be able to take her statement. 

25 Well, that concludes the list of registered 
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1 speakers that we have, and let me just ask Scott and 

2 Dan if there are any remaining clarifying questions. 

3 Otherwise, we can adjourn for now and see if anybody 

4 else shows up within the next hour. 

5 Well, I thank you all very much for taking 

6 the time to come to us today and share your thoughts 

7 about this action that we are considering taking. The 

8 comments were very thoughtful. We're very 

9 appreciative of your time and effort in presenting 

10 those to us. So thank you. 

11 (Whereupon, a short recess was taken.) 

12 MS. WOOD: We are reconvening our public 

13 hearing on the PM2.5 grandfathering provisions, and our 

14 next speaker is Kate Pollard from Sierra Club. Thank 

15 you. 

16 MS. POLLARD: Thank you very much. 

17 I know you have heard from a couple of my 

18 colleagues today, but I wanted to make sure and come 

19 in. I am the associate regional representative for 

20 the Beyond Coal Campaign with the Sierra Club, and I 

21 work specifically with the State of Virginia, and I 

22 work on a daily basis with many area residents and 

23 citizens who are very concerned about these issues but 

24 weren't able to be here today, so I just wanted to 

25 come and contribute. 
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1 We have approximately 40,000 Sierra Club 

2 members in the State of Virginia and numerous partners 

3 and allied groups we work with around the state who 

4 again just couldn't be here to speak for themselves so 

5 I wanted to pass along our concerns and thoughts. 

6 Basically, allowing big polluters to use the 

7 larger particles or PM10 as a surrogate for PM2.5 we just 

8 feel does not necessarily effectively control the tiny 

9 PM2.5 particles, and PM2.5 can behave very differently 

10 from PM10, and controls for the larger material may not 

11 always control the small particles. I know you all 

12 have done a lot of research on this and so I won't go 

13 into any of the details, but area residents are aware 

14 of the distinctions and concerned about the health 

15 effects. So, as such, we feel it's really crucial 

16 that use of PM10 as a surrogate be evaluated on a case17 by-case basis and determined if appropriate for each 

18 situation. 

19 The fine particles produced from burning 

20 fossil fuels and other industrial processes can make 

21 their way deep into our bodies, causing major 

22 illnesses. Even short-term exposure can trigger heart 

23 attacks, cardiovascular disease and lung problems. 

24 Many of our members have experienced health issues and 

25 feel that there is a relationship. You know, 
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1 obviously it's of significant concern since even a 

2 short exposure can have lasting effects. 

3 Long-term exposure is linked to premature 

4 deaths and chronic respiratory disease in children, 

5 and coal-fired power plants, in particular, we 

6 understand are a major source of PM2.5 and we'd like to 

7 continue to look into that and manage and control it 

8 as much as possible. We agree that cleaning up PM2.5

9 could certainly save tens of billions, if not more, in 

10 health costs. 

11 It's already been 13 years since the first 

12 PM2.5 standards went into force, and so we strongly 

13 support EPA's decision to finally end the antiquated 

14 policies and protect our public health to the fullest 

15 extent. 

16 MS. WOOD: Thank you, Ms. Pollard. Any 

17 clarifying questions? 

18 MS. POLLARD: Thank you. 

19 MS. WOOD: Thanks so much for your time 

20 today. We appreciate it. 

21 MS. POLLARD: Very much appreciate it. 

22 MS. WOOD: Okay. We are now going to go 

23 back into recess and remain here until I guess 3 p.m., 

24 and at that point we will adjourn if there are no 

25 speakers here. Thank you. 
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1 (Whereupon, a short recess was taken.) 

2 MS. WOOD: This is Anna Marie Wood of EPA. 

3 It is now 3 p.m. and we have not heard from any 

4 additional speakers on the proposal to repeal the 

5 grandfather provision for PM2.5 and end the PM10

6 surrogate policy. So, with that, we are concluding 

7 the public hearing for today. Thank you very much. 

8 (Whereupon, at 3:00 p.m., the hearing for 

9 the above-entitled matter was concluded.) 

10 // 

11 // 

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 43

 REPORTER'S CERTIFICATE

DOCKET NO.: (None.) 

CASE TITLE: Public Hearing 

HEARING DATE: February 26, 2010 

LOCATION: Washington, D.C. 

 I hereby certify that the proceedings and 

evidence are contained fully and accurately on the 

tapes and notes reported by me at the hearing in the 

above case before the Environmental Protection Agency. 

 Date: February 26, 2010 

 

 Christina Chesley 

 Official Reporter 

 Heritage Reporting Corporation 

 Suite 600 

 1220 L Street, N.W. 

 Washington, D.C. 20005-4018