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CHAPTER 6

STATUTORY AND EXECUTIVE ORDER ANALYSES

6.1 Synopsis

This chapter presents discussion and analyses relating to Executive Orders and statutory 

requirements relevant to the proposed EGU GHG NSPS.1 We discuss analyses conducted to 

meet the requirements of Executive Orders 12866 and 13563, as well as, potential impacts to 

affected small entities required by the Regulatory Flexibility Act (RFA), as amended by the Small 

Business Regulatory Enforcement Fairness Act (SBREFA). We also discuss the requirements of 

the Unfunded Mandates Reform Act of 1995 (UMRA) and assess the impact of the proposed 

rule on state, local and tribal governments and the private sector, along with the analysis 

conducted to comply with the Paperwork Reduction Act (PRA). In addition, we address the 

requirements of Executive Order (EO) 13045: Protection of Children from Environmental 

Health and Safety Risks; EO 13132: Federalism; EO 13175: Consultation and Coordination with 

Indian Tribal Governments; EO 12898: Federal Actions to Address Environmental Justice in 

Minority Populations and Low-Income Populations; EO 13211: Actions that Significantly Affect 

Energy Supply, Distribution, or Use; and the National Technology Transfer and Advancement 

Act (NTTAA). 

6.2 Executive Order 12866, Regulatory Planning and Review, and Executive Order 13563, 

Improving Regulation and Regulatory Review

Under EO 12866 (58 FR 51,735, October 4, 1993), this action is a “significant regulatory 

action” because it “raises novel legal or policy issues arising out of legal mandates.” 

Accordingly, EPA submitted this action to the Office of Management and Budget (OMB) for 

review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011) and any 

changes made in response to OMB recommendations have been documented in the docket for 

this action.

In addition, EPA prepared an analysis of the potential costs and benefits associated with 

this action. This analysis is contained in this RIA. Based on the analysis presented in Chapter 5, 

EPA believes this rule will have negligible compliance costs associated with it, over a range of 

likely sensitivity conditions, because even in the absence of the proposal, electric power 

companies will choose to build new EGUs that comply with the regulatory requirements of this 

 

1

Electricity Generating Unit Greenhouse Gas New Source Performance Standard - The NSPS would be established 

under section 111(b) of the Clean Air Act (CAA). 
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proposal because of existing and expected market conditions. Because our modeling shows 

that new fossil-fuel fired capacity constructed through 2020 will most likely be natural gas 

combined cycle capacity along with a small amount of coal with CCS supported by federal 

funding, the proposed standard of performance –– which is based on the emission rate of a 

new NGCC unit –– would not add costs. The EPA does not project any new coal-fired EGUs 

without CCS to be built.

6.3 Paperwork Reduction Act

The information collection requirements have been submitted for approval to the Office 

of Management and Budget under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. The 

Information Collection Request (ICR) document prepared by the EPA has been assigned EPA ICR 

number 2465.01. 

 This proposed action would impose minimal new information collection burden on 

affected sources beyond what those sources would already be subject to under the authorities 

of CAA parts 75 and 98. OMB has previously approved the information collection requirements 

contained in the existing part 75 and 98 regulations (40 CFR part 75 and 40 CFR part 98) under 

the provisions of the PRA, 44 U.S.C. 3501 et seq. and has assigned OMB control numbers 2060-

0626 and 2060-0629, respectively. Apart from certain reporting costs based on requirements in 

the NSPS General Provisions (40 CFR part 60, subpart A), which are mandatory for all 

owners/operators subject to CAA section 111 national emission standards, there are no new 

information collection costs, as the information required by this proposed rule is already 

collected and reported by other regulatory programs. The recordkeeping and reporting 

requirements are specifically authorized by CAA section 114 (42 U.S.C. 7414). All information 

submitted to the EPA pursuant to the recordkeeping and reporting requirements for which a 

claim of confidentiality is made is safeguarded according to Agency policies set forth in 40 CFR 

part 2, subpart B. 

The EPA believes that electric power companies will choose to build new EGUs that 

comply with the regulatory requirements of this proposal because of existing and expected 

market conditions. The EPA does not project any new coal-fired EGUs without CCS that 

commence construction after this proposal to commence operation over the 3-year period 

covered by this ICR. We estimate that 17 new affected NGCC units would commence operation

during that time period. As a result of this proposal, those units would be required to prepare a 

summary report, which includes reporting of excess emissions and downtime every 6 months.
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When a malfunction occurs, sources must report them according to the applicable 

reporting requirements of 40 CFR part 60, subpart TTTT. An affirmative defense to civil 

penalties for exceedances of emission limits that are caused by malfunctions is available to a 

source if it can demonstrate that certain criteria and requirements are satisfied. The criteria 

ensure that the affirmative defense is available only where the event that causes an 

exceedance of the emission limit meets the narrow definition of malfunction (sudden, 

infrequent, not reasonable preventable, and not caused by poor maintenance and or careless 

operation) and where the source took necessary actions to minimize emissions. In addition, the 

source must meet certain notification and reporting requirements. For example, the source 

must prepare a written root cause analysis and submit a written report to the Administrator 

documenting that it has met the conditions and requirements for assertion of the affirmative 

defense. 

To provide the public with an estimate of the relative magnitude of the burden 

associated with an assertion of the affirmative defense position adopted by a source, the EPA 

has estimated what the notification, recordkeeping, and reporting requirements associated 

with the assertion of the affirmative defense might entail. The EPA’s estimate for the required 

notification, reports, and records, including the root cause analysis, associated with a single 

incident totals approximately totals $3,141, and is based on the time and effort required of a 

source to review relevant data, interview plant employees, and document the events 

surrounding a malfunction that has caused an exceedance of an emission limit. The estimate 

also includes time to produce and retain the record and reports for submission to the EPA. The 

EPA provides this illustrative estimate of this burden, because these costs are only incurred if 

there has been a violation, and a source chooses to take advantage of the affirmative defense.

The EPA provides this illustrative estimate of this burden because these costs are only 

incurred if there has been a violation and a source chooses to take advantage of the affirmative 

defense. Given the variety of circumstances under which malfunctions could occur, as well as 

differences among sources' operation and maintenance practices, we cannot reliably predict 

the severity and frequency of malfunction-related excess emissions events for a particular 

source. It is important to note that the EPA has no basis currently for estimating the number of 

malfunctions that would qualify for an affirmative defense. Current historical records would be 

an inappropriate basis, as source owners or operators previously operated their facilities in 

recognition that they were exempt from the requirement to comply with emissions standards 

during malfunctions. Of the number of excess emissions events reported by source operators, 
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only a small number would be expected to result from a malfunction (based on the definition 

above), and only a subset of excess emissions caused by malfunctions would result in the 

source choosing to assert the affirmative defense. Thus, we believe the number of instances in 

which source operators might be expected to avail themselves of the affirmative defense will 

be extremely small. In fact, we estimate that there will be no such occurrences for any new 

sources subject to 40 CFR part 60, subpart TTTT over the 3-year period covered by this ICR. We 

expect to gather information on such events in the future, and will revise this estimate as better 

information becomes available.

The annual information collection burden for this collection consists only of reporting 

burden as explained above. The reporting burden for this collection (averaged over the first 3 

years after the effective date of the standards) is estimated to be $15,570 and 396 labor hours. 

This estimate includes semi-annual summary reports which include reporting of excess 

emissions and downtime. All burden estimates are in 2010 dollars. Average burden hours per 

response are estimated to be 16.5 hours. The total number of respondents over the 3-year ICR 

period is estimated to be 36. Burden is defined at 5 CFR 1320.3(b).

An agency may not conduct or sponsor, and a person is not required to respond to, a 

collection of information unless it displays a currently valid OMB control number. The OMB 

control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

To comment on the Agency's need for this information, the accuracy of the provided 

burden estimates, and any suggested methods for minimizing respondent burden the EPA has 

established a public docket for this proposed rule, which includes this ICR, under Docket ID 

number EPA-HQ-OAR-2011-0660. The final rule will respond to any OMB or public comments 

on the information collection requirements contained in this proposal. 

6.4. Regulatory Flexibility Act as Amended by the Small Business Regulatory Enforcement 

Fairness Act of 1996, 5 U.S.C. et seq.

The RFA generally requires an agency to prepare a regulatory flexibility analysis of any 

rule subject to notice and comment rulemaking requirements under the Administrative 

Procedure Act or any other statute unless the agency certifies that the rule will not have a 

significant economic impact on a substantial number of small entities. Small entities include 

small businesses, small organizations, and small governmental jurisdictions.
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For purposes of assessing the impacts of this rule on small entities, small entity is 

defined as: 

(1) A small business that is defined by the Small Business Administration’s regulations at 

13 CFR 121.201 (for the electric power generation industry, the small business size standard is 

an ultimate parent entity defined as having a total electric output of 4 million MWh or less in 

the previous fiscal year. The NAICS codes for the affected industry are in Table 6-1 below);

(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.

Table 6-1. Potentially Regulated Categories and Entitiesa

Category NAICS Code Examples of Potentially Regulated Entities

Industry 221112 Fossil fuel electric power generating units.

Federal Government 221112b Fossil fuel electric power generating units owned by the federal 

government.

State/Local 

Government

221112bFossil fuel electric power generating units owned by municipalities.

Tribal Government 921150 Fossil fuel electric power generating units in Indian Country.

a

Include NAICS categories for source categories that own and operate electric power generating units (includes boilers and 

stationary combined cycle combustion turbines).

b

Federal, state, or local government-owned and operated establishments are classified according to the activity in which they 

are engaged.

After considering the economic impacts of this proposed rule on small entities, the 

Administrator of EPA certifies that this action will not have a significant economic impact on a 

substantial number of small entities. 

We do not include an analysis of the illustrative impacts on small entities that may result 

from implementation of this proposed rule by states because we anticipate negligible

compliance costs over a range of likely sensitivities as a result of this proposal. Thus the costto-sales ratios for any affected small entity would be zero costs as compared to annual sales 

revenue for the entity. The EPA believes that electric power companies will choose to build 
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new EGUs that comply with the regulatory requirements of this proposal because of existing 

and expected market conditions. (See the RIA for further discussion of sensitivities.) Because 

our modeling shows that new fossil-fuel fired capacity constructed through 2020 will most likely 

be natural gas combined cycle capacity along with a small amount of coal with CCS supported 

by federal funding, the proposed standard of performance –– which is based on the emission 

rate of a new NGCC unit –– would not add costs. The EPA does not project any new coal-fired 

EGUs without CCS to be built. Accordingly, there are no anticipated economic impacts as a 

result of this proposal.

Nevertheless, the EPA is aware that there is substantial interest in this rule among small 

entities (municipal and rural electric cooperatives). In light of this interest, the EPA determined 

to seek early input from representatives of small entities while formulating the provisions of 

this proposed regulation. Such outreach is also consistent with the President’s January 18, 2011 

Memorandum on Regulatory Flexibility, Small Business, and Job Creation, which emphasizes 

the important role small businesses play in the American economy. This process has enabled 

the EPA to hear directly from these representatives, at a very preliminary stage, about how it 

should approach the complex question of how to apply Section 111 of the CAA to the regulation 

of GHGs from these source categories. The EPA’s outreach regarded planned actions for new 

and existing sources, but only new sources would be affected by this proposed action.

The EPA conducted an initial outreach meeting with small entity representatives on 

April 6, 2011. The purpose of the meeting was to provide an overview of recent EPA proposals 

impacting the power sector. Specifically, overviews of the Cross-State Air Pollution Rule, the 

Mercury and Air Toxics Standards, and the Clean Water Act 316(b) Rule proposals were 

presented.

The EPA conducted outreach with representatives from 20 various small entities that 

potentially would be affected by this rule. The representatives included small entity 

municipalities, cooperatives, and private investors. The EPA distributed outreach materials to 

the small entity representatives; these materials included background, an overview of affected 

sources and GHG emissions from the power sector, an overview of CAA section 111, an 

assessment of CO2 emissions control technologies, potential impacts on small entities, and a 

summary of the five listening sessions that EPA held in February and March 2011 with various 

stakeholder groups to get feedback from key stakeholders and the public before the agency 
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initiated the rulemaking process for new greenhouse gas emissions standards.

2

EPA met with 

eight of the small entity representatives, as well as three participants from organizations 

representing power producers, on June 17, 2011, to discuss the outreach materials, potential 

requirements of the rule, and regulatory areas where the EPA has discretion and could 

potentially provide flexibility.

A second outreach meeting was conducted on July 13, 2011. We met with nine of the 

small entity representatives, as well as three participants from organizations representing 

power producers. During the second outreach meeting, various small entity representatives 

and participants from organizations representing power producers presented information 

regarding issues of concern with respect to development of standards for GHG emissions for 

both new and existing sources. Specifically, topics discussed included: boilers with limited 

opportunities for efficiency improvements due to NSR complications for conventional 

pollutants; variances per kilowatt-hour and in heat rates over monthly and annual operations; 

significance of plant age; legal issues; importance of future determination of carbon neutrality 

of biomass; and differences between municipal government electric utilities and other utilities.

Small entities expressed concern regarding units making modifications being regulated 

as new sources. As explained above, we are not proposing a standard of performance for 

modifications. As a result, sources that undertake modifications would be treated as existing 

sources and thus would not be subject to the requirements proposed in this notice. As also 

explained above, the EPA is not proposing standards of performance for existing proposed 

EGUs, which are referred to as transitional sources, that have acquired a complete 

preconstruction permit by the time of this proposal and that commence construction within 12 

months of this proposal. As a result, any transitional sources owned by small entities would not 

be subject to the standards of performance proposed in today’s rule.

We invite comments on all aspects of the proposal and its impacts, including potential 

adverse impacts, on small entities.

6.5 Unfunded Mandates Reform Act of 1995

This proposed rule does not contain a Federal mandate that may result in expenditures 

of $100 million of more for State, local, or tribal governments, in the aggregate, or the private 

sector in any one year. The EPA believes this proposed rule will have negligible compliance 

 

2

http://www.epa.gov/airquality/listen.html
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costs associated with it over a range of likely sensitivity conditions because electric power 

companies will choose to build new EGUs that comply with the regulatory requirements of this 

proposal because of existing and expected market conditions. (See the RIA for further 

discussion of sensitivities.) As previously explained, because our modeling shows that new 

fossil-fuel fired capacity constructed through 2020 will most likely be natural gas combined 

cycle capacity along with a small amount of coal with CCS supported by federal funding, the 

proposed standard of performance –– which is based on the emission rate of a new NGCC unit 

–– would not add costs. The EPA does not project any new coal-fired EGUs without CCS to be 

built. Thus, this proposed rule is not subject to the requirements of sections 202 or 205 of 

UMRA. This proposed rule is also not subject to the requirements of section 203 of UMRA 

because it contains no regulatory requirements that might significantly or uniquely affect small 

governments. 

In light of interest in this rule among governmental entities, the EPA initiated 

consultations with governmental entities. The EPA invited the following 10 national 

organizations representing state and local elected officials to a meeting held on April 12, 2011, 

in Washington DC: 1) National Governors Association; 2) National Conference of State 

Legislatures, 3) Council of State Governments, 4) National League of Cities, 5) U.S. Conference 

of Mayors, 6) National Association of Counties, 7) International City/County Management 

Association, 8) National Association of Towns and Townships, 9) County Executives of America, 

and 10) Environmental Council of States. These 10 organizations representing elected state and 

local officials have been identified by the EPA as the “Big 10” organizations appropriate to 

contact for purpose of consultation with elected officials. The purposes of the consultations

were to provide general background on the proposal, answer questions, and solicit input from 

state/local governments. The EPA’s consultation regarded planned actions for new and existing 

sources, but only new sources would be affected by this proposed action.

During the meeting, officials asked clarifying questions regarding CAA section 111 

requirements and efficiency improvements that would reduce CO2 emissions. In addition, they 

expressed concern with regard to the potential burden associated with impacts on state and 

local entities that own/operate affected utility boilers, as well as on state and local entities with 

regard to implementing the rule. Subsequent to the April 12, 2011 meeting, the EPA received a 

letter from the National Conference of State Legislatures. In that letter, the National 

Conference of State Legislatures urged the EPA to ensure that the choice of regulatory options 

maximizes benefit and minimizes implementation and compliance costs on state and local 
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governments; to pay particular attention to options that would provide states with as much 

flexibility as possible; and to take into consideration the constraints of the state legislative 

calendars and ensure that sufficient time is allowed for state actions necessary to come into 

compliance.

6.6 Executive Order 13132, Federalism

This proposed action does not have federalism implications. It would 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 EO 13132. This proposed action would not impose substantial

direct compliance costs on state or local governments nor would it preempt state law. Thus, 

Executive Order 13132 does not apply to this action. The EPA consulted with state and local 

officials in the process of developing the proposed rule to permit them to have meaningful and 

timely input into its development. The EPA’s consultation regarded planned actions for new 

and existing sources, but only new sources would be affected by this proposed action. The EPA 

met with 10 national organizations representing state and local elected officials to provide 

general background on the proposal, answer questions, and solicit input from state/local 

governments. The UMRA discussion in this chapter includes a description of the consultation. In 

the spirit of EO 13132 and consistent with EPA policy to promote communications between the 

EPA and state and local governments, the EPA specifically solicits comment on this proposed 

action from state and local officials.

6.7 Executive Order 13175, Consultation and Coordination with Indian Tribal 

Governments

Subject to the EO 13175 (65 FR 67249, November 9, 2000) EPA may not issue a 

regulation that has tribal implications, that imposes substantial direct compliance costs, and 

that is not required by statute, unless the Federal government provides the funds necessary to 

pay the direct compliance costs incurred by tribal governments, or EPA consults with tribal 

officials early in the process of developing the proposed regulation and develops a tribal 

summary impact statement. 

EPA has concluded that this proposed action would not have tribal implications. It 

would neither impose substantial direct compliance costs on tribal governments, nor preempt 

tribal law. This proposed rule would impose requirements on owners and operators of EGUs. 

The EPA is aware of three coal-fired EGUs located in Indian country but is not aware of any 
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EGUs owned or operated by tribal entities. The EPA notes that this proposal does not affect 

existing sources such as the three coal-fired EGUs located in Indian country, but addresses CO2

emissions for new EGU sources only.

Because the EPA is aware of tribal interest in this proposed rule, the EPA offered 

consultation with tribal officials early in the process of developing this proposed regulation to 

permit them to have meaningful and timely input into its development. The EPA’s consultation 

regarded planned actions for new and existing sources, but only new sources would be affected 

by this proposed action.

Consultation letters were sent to 584 tribal leaders. The letters provided information 

regarding EPA’s development of NSPS and emission guidelines for EGUs and offered 

consultation. A consultation/outreach meeting was held on May 23, 2011, with the Forest 

County Potawatomi Community, the Fond du Lac Band of Lake Superior Chippewa Reservation, 

and the Leech Lake Band of Ojibwe. Other tribes participated in the call for information 

gathering purposes. In this meeting, the EPA provided background information on the GHG 

emission standards to be developed and a summary of issues being explored by the Agency. 

Tribes suggested that the EPA consider expanding coverage of the GHG standards to include 

combustion turbines, lowering the 250 MMBtu per hour heat input threshold so as to capture 

more EGUs, and including credit for use of renewables. The tribes were also interested in the 

scope of the emissions averaging being considered by the Agency (e.g., over what time period, 

across what units) for a possible existing source standard. In addition, the EPA held a series of 

listening sessions on this proposed action. Tribes participated in a session on February 17, 2011 

with the state agencies, as well as in a separate session with tribes on April 20, 2011.

The EPA will also hold additional meetings with tribal environmental staff to inform 

them of the content of this proposal as well as provide additional consultation with tribal 

elected officials where it is appropriate. We specifically solicit additional comment on this 

proposed rule from tribal officials.

6.8 Executive Order 13045, Protection of Children from Environmental Health Risks and 

Safety Risks

The EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying to those 

regulatory actions that concern health or safety risks, such that the analysis required under 

section 5-501 of the Order has potential to influence the regulation. This proposed action is not 

subject to EO 13045 because it is based solely on technology performance. The proposal is not 
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expected to produce changes in emissions of greenhouse gases or other pollutants but does 

encourage the current trend towards cleaner generation, helping to protect air quality and 

children's health. The Agency recognizes that children are among the groups most vulnerable 

to climate change impacts and the public is invited to submit comments or identify peer 

reviewed studies relevant to this proposal.

6.9 Executive Order 13211, Actions Concerning Regulations That Significantly Affect 

Energy Supply, Distribution, or Use

This proposed action is not a “significant energy action” as defined in Executive Order 

13211 (66 FR 28355, May 22, 2001), because it is not likely to have a significant adverse effect 

on the supply, distribution, or use of energy. This proposed action is anticipated to have 

negligible impacts on emissions, costs or energy supply decisions for the affected electric utility 

industry.

6.10 National Technology Transfer and Advancement Act

Section 12(d) of the NTTAA of 1995 (Public Law No. 104-113; 15 U.S.C. 272 note) directs 

the EPA to use Voluntary Census Standards (VCS) in their regulatory and procurement activities 

unless to do so would be inconsistent with applicable law or otherwise impractical. VCS are 

technical standards (e.g., materials specifications, test methods, sampling procedures, business 

practices) developed or adopted by one or more voluntary consensus bodies. The NTTAA 

directs the EPA to provide Congress, through annual reports to the OMB, with explanations 

when an agency does not use available and applicable VCS.

This proposed rulemaking involves technical standards. The EPA cites the following 

standards in this proposed rule: D5287-08 (Standard Practice for Automatic Sampling of 

Gaseous Fuels), D4057-06 (Standard Practice for Manual Sampling of Petroleum and Petroleum 

Products), and D4177-95(2010) (Standard Practice for Automatic Sampling of Petroleum and 

Petroleum Products). The EPA is proposing use of Appendices B, D, F, and G to 40 CFR part 75; 

these Appendices contain standards that have already been reviewed under the NTTAA.

The EPA welcomes comments on this aspect of the proposed rulemaking and, 

specifically, invites the public to identify potentially-applicable VCS and to explain why such 

standards should be used in this action.
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6.11 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 U.S. EPA has determined that this proposed rule would not 

result in disproportionately high and adverse human health or environmental effects on any 

minority, low-income, or indigenous populations.