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Introduction 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

REGION 10 

December 19, 2014 

1200 Sixth Avenue, Suite 900 

Seattle, WA 98101-3140 

Alaska's Part D Major New Source Review Rules 

David C. Bray, Senior Air Advisor~fl Office of Air, Waste and Toxics [/V .-...:J 

Docket EPA-RIO-OAR-2014-0753 

OFFICE OF 

AIR, WASTE, AND TOXICS 

On November 4, 2014, EPA Region 8 proposed to disapprove the Wyoming Part D 

nonattainment area new source review (NNSR) rules based on a determination that the Wyoming 

rules, which incorporate by reference 40 CFR 51 .165 (EPA's regulations for State 

Implementation Plan (SIP) NNSR rules), did not comply with several Clean Air Act 

requirements, including sections 110(a)(2)(C), 110(a)(2)(A) and 172(c)(5). 79 FR 65362. 

On that same day, EPA Region 10 proposed to approve the Alaska Part D NNSR rules based on 

a finding that the Alaska NNSR rules in 18 AAC 50, Article 3, Section 311 ''Nonattainment area 

major stationary source permits" and 18 AAC 50.040(i) (incorporating by reference text from 40 

CFR 51.165) met the requirements ofthe Clean Air Act and EPA's regulations for SIP NNSR 

rules. 79 FR 65366. EPA Region 10 noted that 18 AAC 50.311 had previously been approved 

into the Alaska SIP on August 14, 2007 (72 FR45378) and had not been revised since that time. 

EPA further explained that the primary changes proposed for approval in the SIP revision were 

updating the effective dates of the Federal regulations previously adopted by reference in the 

Alaska SIP for purposes of Aiaska's Part D NNSR program. 

Background 

EPA's requirements for SIP permit-to-construct programs, including the Part D NNSR program, 

are contained in 40 CFR part 51, subpart I, and specifically, in 40 CFR 51.160 through 51.166. 

The requirements for nonattainment area permitting are found in 51.165( a), but this section does 

not stand alone and is part of a series of sections that together, comprise the requirements for 

approvable SIP permit-to-construct programs (e.g., 51.161 spells out the requirements for public 

notice and comment; 51.164 the requirements for stack heights and dispersion techniques). 
Importantly, the provisions of subpart I are not written in the form of an implementable 

permitting rule which applies to the owner or operator of sources who wish to construct or 

modify, but rather they are requirements that a State must meet in order to get its permitting rules 

approved as part of the SIP. In contrast to the requirements for NNSR, there are both SIP PSD 

requirements in 40 CFR 51 .166 and federal PSD regulations in 40 CFR 52.21, the latter being an 

implementable permitting rule that applies in States that do not have an approved SIP PSD rule. 

For a variety of reasons, many States incorporate 40 CFR 52.21 into State rules as the State PSD 

program. However, EPA does not have a similar implementable NNSR permitting rule that can 

be directly incorporated by reference into State rules. As a result, some States have incorporated 

by reference all or parts of 40 CFR 51.165 into State rules for purposes ofNNSR. 

Analysis 

Unlike the Wyoming rule, which simply incorporates by reference the planning requirements of 

40 CFR 51.165 and does not link the federal permitting requirements directly to Wyoming's 

existing state permitting rules, Alaska has adopted a complete State permitting rule that includes 

provisions that are specifically applicable to sources locating in nonattainment areas, including 

State provisions specifying the permissible location of offsets (see 18 AAC 50.311 ). This 

provision makes clear that no source may commence construction of a major stationary source, a 

major modification, or a "PAL" major modification of a nonattainment pollutant in a 

nonattainrnent area without obtaining a construction permit from the Alaska Department of 

Environmental Conservation (ADEC). 18 AAC 50.311 also specifies what must be included in 

an application for a Part D NNSR permit, such as a demonstration that emissions of the 

nonattainrnent pollutant will be controlled to a rate that represents the Lowest Achievable 

Emission Rate, and documentation that proposed emission offsets will be sufficient, enforceable, 

and occur by the time the new or modified source begins operation. Finally, that provision also 

specifies that ADEC will provide notice and a 30-day public comment period on the proposed 

permit or permit denial and that the permit can only be issued if the applicant demonstrates to 

ADEC that the permitting requirements of 40 CFR 51.165 that have been incorporated by 

reference in Alaska's rules will be met. Importantly, the Alaska incorporation by reference 

provision at 18 AAC 50.040(i) explicitly states that it is adopting the text of the identified 

provisions of 40 CFR 51.165 "setting out provisions that a state implementation plan shall or 

may contain." This makes clear that the incorporated provisions of 40 CFR 51.165, including 

those specifying that a "state plan may contain ... ", are requirements of Alaska's Part D NNSR 

permitting program. 

Because Alaska's reliance on 40 CFR 51.165 as part of its Part D NNSR program is part of an 

overall construction permitting program that imposes additional requirements on new and 

modified major sources located in nonattainment areas, and because Alaska's incorporation by 

reference oftext from 40 CFR 51.165 is clear with respect to the intent ofthe State to adopt the 

permitting requirements as State law applicable to sources locating in nonattainment areas, the 

concerns raised in the proposed action on Wyoming's incorporation by reference of 40 CFR 

51.165 are not present in Alaska's rules.