United States Environmental Protection Agency, Region 9

Air Division

Technical Support Document

EPA's Notice of Proposed Rulemaking

Revision to the Arizona State Implementation Plan

for the Arizona Department of Environmental Quality

Revisions to Air Plan; Arizona; Stationary Sources; New Source Review

New or Amended Rules from Arizona Administrative Code, Title 18,

Chapter 2, Articles 1, 2, 3, and 4; New or Amended Statutory Provisions

from Arizona Revised Statutes, Title 49, Chapters 1 and 3

March 2015 
Table of Contents

Section Page 

1. Introduction 1 

2. Description of SIP Revision Submittal 2 

2.1 Completeness 7 

3. What are the General Requirements of a SIP-Approved NSR Program? 7 

3.1 Minor NSR 7 

3.2 Prevention of Significant Deterioration 8 

3.3 Nonattainment NSR 10 

4. Summary of Arizona’s Submitted Statutory Provisions and Rules 10 

4.1 Statutory Provisions 11 

4.2 Rules 11 

5. Review of NSR SIP Submittal 15 

5.1 Summary – NSR Permitting Program – 40 CFR 51.160 through 51.166 15 

5.2 40 CFR 51.160 – Legally Enforceable Procedures 17 

5.3 40 CFR 51.161 – Public Availability of Information 28 

5.4 40 CFR 51.162 – Identification of Responsible Agency 30 

5.5 40 CFR 51.163 – Administrative Procedures 31 

5.6 40 CFR 51.164 – Stack Height Provisions 32 

5.7 40 CFR 51.165 – Permit Requirements (NA-NSR) 33 

5.8 40 CFR 51.166 – Prevention of Significant Deterioration of Air Quality 44 

6. Review of Non-NSR Related Rules and Statutory Provisions 59 

6.1 R18-2-311, Test Methods and Procedures 60 

6.2 R18-2-312, Performance Tests 60 

6.3 A.R.S. § 49-107, Local Delegation of State Authority 60 

7. Review of Existing SIP Rules and Statutory Provisions to be Replaced 61 

8. Sections 110(a)(2)(E)(i), 110(l) and 193 of the Act 68 

9. EPA’s Proposed Action 71 

10. Attachments 71 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

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1. Introduction

This technical support document (TSD) focuses primarily on the preconstruction permitting 

requirements for stationary sources, also called New Source Review or NSR, in title I of the Clean Air 

Act (CAA or the Act) and EPA’s implementing regulations addressing the State Implementation Plan 

(SIP) requirements for State NSR programs at title 40 of the Code of Federal Regulations (CFR) part 51, 

subpart I. This TSD will address the requirements for the three main components of the federal NSR 

program, and discuss EPA’s findings on whether the rules and regulations related to NSR that have 

been submitted by the Arizona Department of Environmental Quality (ADEQ) for approval into the SIP 

for Arizona meet federal NSR requirements. In addition, this TSD addresses additional rules and a 

statutory provision submitted by ADEQ for inclusion in the SIP that are not specifically related to NSR. 

This TSD also briefly addresses certain older and generally outdated provisions in the Arizona SIP, 

primarily related to NSR, that ADEQ has requested that EPA remove from the SIP as part of this action, 

most of which are being replaced the newer ADEQ rules that are the primary focus of this action. Last, 

the TSD discusses EPA’s findings under Sections 110(l) and 193 of the Act relevant to this action.

The three main components of the federal NSR program are briefly summarized as follows: 

PSD Program 

Part C of title I of the Act, and the implementing regulations at 40 CFR 51.166, contain the 

requirements for SIPs to establish preconstruction permitting programs for the prevention of 

significant deterioration of air quality (PSD) in areas designated as attainment or unclassifiable for the 

national ambient air quality standards (NAAQS). The PSD program requirements under part C apply to 

major stationary sources and major modifications, as those terms are defined in 40 CFR part 51, 

subpart I, at sources that would be located within attainment or unclassifiable areas. The PSD 

requirements apply to all regulated NSR pollutants, except those pollutants for which an area has been 

designated as nonattainment. 

Nonattainment NSR Program 

Part D of title I of the Act, and the implementing regulations at 40 CFR 51.165, contain the NSR 

requirements for areas designated nonattainment for a NAAQS. The requirements under part D, 

referred to as nonattainment NSR or NA-NSR, apply to nonattainment pollutants at major stationary 

sources and major modifications at sources located in nonattainment areas. This program also includes 

requirements for new major stationary sources and major modifications located in attainment or 

unclassifiable areas with emissions that may cause or contribute to violation of a NAAQS in a 

nonattainment area. 

Minor NSR and General NSR Program Requirements 

Section 110(a)(2)(C) of the Act requires that each SIP include a program to provide for ‘‘regulation of 

the modification and construction of any stationary source within the areas covered by the plan as 

necessary to assure that national ambient air quality standards are achieved, including a permit 

program as required in parts C and D’’ of title I of the Act. Thus, in addition to the permit programs 

required in parts C and D of title I of the Act, which apply to new or modified major stationary sources 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

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of pollutants and major modifications, each SIP must include a program to provide for the regulation of 

the construction and modification of any stationary source within the areas covered by the plan as 

necessary to assure attainment and maintenance of the NAAQS. These general preconstruction 

requirements are commonly referred to as the ‘‘minor NSR program’’ requirements and are 

implemented through EPA’s regulations at 40 CFR 51.160–51.164. These more general program 

requirements are the only NSR requirements that apply to these “minor” stationary sources and nonmajor modifications. While these requirements also apply to major sources and major modifications, 

such sources are also addressed by much more detailed requirements in parts C and D of the Act and 

their implementing regulations. 

2. Description of SIP Revision Submittal 

The primary rules that are the subject of EPA’s current action and this TSD were adopted by ADEQ and 

submitted to EPA on October 29, 2012, as supplemented on September 6, 2013, July 2, 20141, and 

February 23, 2015. In addition, we are acting on two rules that were submitted on July 28, 2011 and 

supplemented on May 16, 2014.2 ADEQ is the governor’s designee for submitting official revisions of 

the Arizona SIP to EPA. Table 1 below identifies the rules reviewed in this action and this TSD for 

approval into and/or removal from the Arizona SIP. 

Not all rules that were submitted with the October 29, 2012 SIP revision are being addressed in this 

action. Some of these rules were acted on in an earlier action – see Revisions to the Arizona State 

Implementation Plan; State Stationary Source Rules, 79 Fed. Reg. 56655 (Sept. 23, 2014). In addition, 

we are deferring action until a later date on certain other ADEQ rules or statutory provisions that were 

submitted with the October 29, 2012 SIP revision. See Table 2. 

With the exception of ADEQ rules R18-2-311 and R18-2-312, and A.R.S. § 49-107, the rules that are the 

subject of this action, collectively, are intended to establish a pre-construction program for reviewing 

and permitting new or modified stationary sources in Arizona.3 The SIP submittal that comprises these 

rules is collectively referred to herein as the “NSR SIP submittal” or “submitted NSR rules.” 

 

1 ADEQ submitted an additional statutory provision in this submittal, A.R.S. § 49-107, which we are also acting on. 

2 We note that portions of ADEQ’s SIP-approved rule R18–2–310, which provides affirmative defenses for excess emissions 

during malfunctions (R18–2–310(B)) and for excess emissions during startup or shutdown (R18–2- 310(C)), are currently the 

subject of a separate rulemaking action by EPA. In a 2013 notice of proposed rulemaking, and a 2014 supplemental notice 

of proposed rulemaking that revised certain of the findings described in the 2013 notice, EPA proposed to find R18–2–

310(B) and R18–2–310(C) substantially inadequate to meet CAA requirements and proposed to issue a SIP call with respect 

to these provisions. See 78 Fed. Reg. 12460, 12533-34 (Feb. 22, 2013); 79 Fed. Reg. 55920, 55946-47 (Sept. 17, 2014). 

ADEQ’s R18–2–310 is not part of the ADEQ SIP submittal that is under consideration in this action, and this rule is not being 

evaluated or otherwise addressed by EPA as part of our current action on ADEQ’s SIP submittal. 

3 Rules R18-2-301 through R18-2-334 (Article 3 rules) also contain requirements to address the CAA title V requirements 

for operating permit programs, but we are not evaluating these rules for title V purposes at this time. We will evaluate the 

Article 3 rules for compliance with the requirements of title V of the Act and EPA’s implementing regulations in 40 CFR part 

70 following receipt of an official part 70 program submittal from ADEQ. 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

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This SIP revision will apply to areas of Arizona where ADEQ has jurisdiction. ADEQ’s permitting 

jurisdiction is described below in Section 5.4. 

ADEQ’s existing SIP-approved NSR program, which consists primarily of the rules requested by ADEQ 

for removal from the SIP, as listed in Table 1, is significantly out of date. EPA has not acted to approve 

substantial revisions to the Arizona SIP concerning ADEQ’s NSR rules since the 1980s. The majority of 

the rules in ADEQ’s current SIP-approved NSR program have been repealed, revised and replaced by 

ADEQ with revised rules and new regulatory references for purposes of State law. In so doing, ADEQ 

has made significant revisions to its NSR program under State law (including, for example, switching 

from separate preconstruction and operating permit programs to a “unitary” permitting program) that 

are not yet approved into the SIP. EPA’s action on this NSR SIP revision will update much of the NSR SIP 

for Arizona so that the NSR rules in the Arizona SIP for the areas regulated by ADEQ (or agencies 

delegated authority by ADEQ) are generally consistent with ADEQ’s current NSR rules adopted for State 

law purposes. 

In this action, EPA has reviewed the NSR SIP submittal for consistency with all requirements for a 

federal NSR program. As discussed in detail in this TSD, we are generally proposing a limited approval 

and limited disapproval for this submittal. While the NSR SIP submittal represents a significant update 

and strengthening of the Arizona SIP, we have identified a number of issues that must be addressed 

before EPA can fully approve ADEQ’s revised NSR program. We are also proposing disapproval of two 

specific aspects of ADEQ’s NSR submittal that are analogous to provisions in the federal regulations 

that have recently been vacated by federal Courts and which are separable from the remainder of the 

program. In addition, we are proposing a limited approval for a portion of ADEQ’s NA-NSR program 

based on requirements of section 189(e) of the Act related to the permitting of major sources of PM10

and PM2.5 precursors. 

We have also reviewed ADEQ rules R18-2-311 – Test Methods and Procedures, and R18-2-312 – 

Performance Tests as part of this action, although they are not generally considered rules related to 

NSR. Rules R18-2-311 and R18-2-312 were submitted in a separate SIP package on July 28, 2011. EPA 

did not act on these rules its September 23, 2014 rulemaking that took action on other rules submitted 

on July 28, 2011, and instead deferred action until this NSR rulemaking. As such, we are addressing the 

two rules in this action and are proposing a limited approval and limited disapproval of these rules for 

the reasons described in Section 6 below. In addition, we reviewed A.R.S. § 49-107 and are proposing 

approval of A.R.S. § 49-107 into the Arizona SIP. 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

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Table 1 – ADEQ Statutory Provisions and Regulations Reviewed in this SIP Action 

Rule or Statutory

Provision

Addressed in this

TSD and

Rulemaking

Title Adoption or

Revision Date4

Existing SIP Rule(s)

Requested to be

Removed from SIP

A.R.S. § 49-107 Local delegation of state authority August 18, 1987 R9-3-803

A.R.S. § 36-1706, R9-3-

801, R9-3-802 (replace 

with recently approved 

SIP provisions) 

R9-3-306(J) 

R18-2-101 

(definitions (2), (32), 

(87), (109), and 

(122)) 

Definitions August 7, 2012 R9-3-101 (except (20))

R18-2-217 Designation and Classification of 

Attainment Areas

November 15, 

1993 

None

R18-2-218 Limitation of Pollutants in 

Classified Attainment Areas

August 7, 2012 R9-3-217(B)

R18-2-301 Definitions August 7, 2012 R9-3-101 (except (20))

R18-2-302 Applicability; Registrations; 

Classes of Permits

August 7, 2012 R9-3-301(A-B), R9-3-

306(A) 

R18-2-302.01 Source Registration Requirements August 7, 2012 None

R18-2-303 Transition from Installation and 

Operating Permit Program to 

Unitary Permit Program; 

Registration transition; Minor NSR 

transition

August 7, 2012 None

R18-2-304 Permit Application Processing 

Procedures

August 7, 2012 R9-3-301(E, M-P), R9-3-

306(C-F), and R9-3-

318(A,C) 

R18-2-306 Permit Contents December 20, 1999 R9-3-301(C,D,G,H) , R9-3-

306(B,G) and R9-3-308 

R18-2-306.01 Permits Containing Voluntarily 

Accepted Emission Limitations 

and Standards

January 1, 2007 None

R18-2-306.02 Establishment of an Emissions Cap September 22, 

1999 

None

 

4 Date the adoption or revision became effective. 
Arizona DEQ NSR Program SIP Submittal 

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Rule or Statutory

Provision

Addressed in this

TSD and

Rulemaking

Title Adoption or

Revision Date4

Existing SIP Rule(s)

Requested to be

Removed from SIP

R9-3-314 (replace with 

recently approved SIP 

provisions) 

R18-2-311

(submitted on July 

28, 2011) 

Test Methods and Procedures November 15, 

1993 

R9-3-310 

R18-2-312

(submitted on July 

28, 2011) 

Performance Tests November 15, 

1993 

R9-3-312 

R18-2-315 Posting of Permit November 15, 

1993 

R9-3-315

R18-2-316 Notices by Building Permit 

Agencies

May 14, 1979 R9-3-316 

R9-3-319 (delete w/o 

replacement) 

R9-3-322 (delete w/o 

replacement) 

R18-2-319 Minor Permit Revisions August 7, 2012 R9-3-301 (except (I-K))

R18-2-320 Significant Permit Revisions August 7, 2012 R9-3-301 (except (I-K))

R18-2-321 Permit Reopenings; Revocation 

and Reissuance; Termination

August 7, 2012 R9-3-318

R18-2-323 Permit Transfers February 3, 2007 R9-3-317

R18-2-330 Public Participation August 7, 2012 R9-3-301(J, L)

R18-2-332 Stack Height Limitation November 15, 

1993 

None

R18-2-334 Minor New Source Review August 7, 2012 None

Appendix 4 (delete w/o 

replacement) 

Appendix 5 (delete w/o 

replacement) 

R18-2-401 Definitions August 7, 2012 R9-3-101 (except (20))

R18-2-402 General August 7, 2012 R9-3-301 (except (I, K), 

R9-3-307 

R18-2-403 Permits for Sources Located in 

Nonattainment Areas

August 7, 2012 R9-3-302 

R18-2-404 Offset Standards August 7, 2012 R9-3-303 

R18-2-405 Special Rule for Major Sources of 

VOC or Nitrogen Oxides in Ozone 

Nonattainment Areas Classified as 

Serious or Severe

August 7, 2012 None
Arizona DEQ NSR Program SIP Submittal 

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Rule or Statutory

Provision

Addressed in this

TSD and

Rulemaking

Title Adoption or

Revision Date4

Existing SIP Rule(s)

Requested to be

Removed from SIP

R18-2-406 Permit Requirements for Sources 

Located in Attainment and 

Unclassifiable Areas

August 7, 2012 R9-3-304 (except (H))

R18-2-407 Air Quality Impact Analysis and 

Monitoring Requirements

August 7, 2012 R9-3-301(F), R9-3-305 

R18-2-409 Air Quality Models August 7, 2012 R9-3-311 

R18-2-412 PALs None

Table 2 – Rules or Provisions Deferred for a Later Action – Submitted or Requested to be removed from SIP on October 29, 

20125 

Rule or Statutory

Provision to be

Addressed in a

Subsequent TSD

and Rulemaking

Existing SIP

Requirement

Requested to be

Removed

Title

R18-2-101(20) Definitions (begin actual construction)

R18-2-310.01 Reporting Requirements

R18-2-5026 General Permit Development

R18-2-504 Application Coverage under General Permit

R18-2-505 Public Notice

R18-2-509 General Permit Renewal

R18-2-512 Changes to Facilities Granted Coverage under General 

Permits 

R18-2-513 Portable Sources Covered under a General Permit

A.R.S. § 49-426(F) Permits; duties of director; exceptions; applications; 

objections; fees 

R9-3-101(20) Definitions (begin actual construction)

R9-3-301(I), (K) Installation Permits: General

R9-3-304(H) Installation Permits in Attainment Areas

 

 

5 See also ADEQ’s February 23, 2015 supplement to its NSR SIP submittal. ADEQ requested that EPA not act on certain 

portions of its October 29, 2012 submittal. In addition, we are deferring action on other separable pieces of ADEQ’s 

submittal until a later date. 

6 The rules we are proposing action on do not reference Article 5 or the specific rules ADEQ submitted as part of its general 

permits program. Until, EPA takes action on ADEQ’s general permit rules, ADEQ must ensure its general permits program is 

complying with the requirements in its SIP-approved NSR program. 
Arizona DEQ NSR Program SIP Submittal 

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2.1 Completeness

With respect to procedures, CAA sections 110(a) and 110(l) require that revisions to a SIP be adopted 

by the State after reasonable notice and public hearing. EPA has promulgated specific procedural 

requirements for SIP revisions in 40 CFR part 51, subpart F. These requirements include publication of 

notices, by prominent advertisement in the relevant geographic area, of a public hearing on the 

proposed revisions, a public comment period of at least 30 days, and an opportunity for a public 

hearing. Based on our review of the public process documentation included in the October 29, 2012, 

July 2, 2014, and July 28, 2011 submittals, we find that ADEQ has provided sufficient evidence of public 

notice and opportunity for comment and public hearings prior to adoption and submittal of these rules 

to EPA. 

ADEQ’s October 29, 2012 and July 2, 2014 NSR SIP submittals were determined complete, according to 

Appendix V of 40 CFR part 51, by operation of law on April 29, 20137 and December 2, 2014, 

respectively. The SIP submittal package with R18-2-311 and R18-2-312 was considered complete by 

operation of law on December 28, 2011. 

3. What are the General Requirements for a SIP-Approved NSR Program?

The NSR program is a preconstruction review and permitting program established under CAA sections 

110, 160-169, 172 and 173 that is applicable to certain new stationary sources and modifications at 

existing stationary sources. The specific regulatory requirements applicable to SIP-approved NSR 

programs are contained in 40 CFR part 51, subpart I. As stated above, there are three specific sets of 

permitting requirements included in subpart I: the program commonly referred to as the “minor NSR 

program” (40 CFR 51.160-51.164), NA-NSR (40 CFR 51.165), and PSD (40 CFR 51.166). 

3.1 Minor NSR

Section 110(a)(2)(C) requires each SIP to include a program for the regulation of the modification and 

construction of any stationary source within the areas covered by the plan as necessary to assure 

attainment and maintenance of the NAAQS. In addition to the permit programs required under parts C 

and D of the CAA for PSD sources and NA-NSR sources, respectively, which are discussed below, EPA’s 

regulations at 40 CFR 51.160-51.164 provide general programmatic requirements to implement this 

statutory mandate commonly referred to as the “minor NSR program.” These minor NSR program 

regulations impose requirements for SIP approval of State and local programs that are more general in 

nature as compared with the specific regulatory requirements for PSD and NA-NSR permitting 

programs. Under EPA’s regulations governing the minor NSR program, States and local air agencies 

retain a level of discretion to define the types and sizes of sources subject to the program, whereas 

under the PSD and NA-NSR permitting programs, the sources subject to regulation are specified by EPA 

regulations. However, EPA’s regulations require that State minor NSR programs ensure that the 

 

7 See September 9, 2013 letter from EPA to ADEQ. 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

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construction or modification of any stationary source would be prevented if (1) it would result in a 

violation of the applicable control strategy; or (2) it would interfere with the attainment or 

maintenance of a NAAQS. These general requirements are included in 40 CFR 51.160, 51.161, and 

51.163. 

In addition, 40 CFR 51.162 requires that each SIP identify the State or local agency that will be 

responsible for meeting the requirements of 40 CFR part 51, subpart I in each area of the State, and 

that where such responsibility rests with an agency other than an air pollution control agency, such 

agency will consult with the appropriate State or local air pollution control agency in carrying out the 

provisions of subpart I. 

Finally, 40 CFR 51.164 requires that SIPs establish procedures that ensure the degree of emission 

limitation required of any source for control of any air pollutant must not be affected by so much of 

any source's stack height that exceeds good engineering practice or by any other dispersion technique, 

except as provided in 40 CFR 51.118(b). Such procedures must provide that before a State or local 

agency issues a permit to a source based on a good engineering practice stack height that exceeds the 

height allowed by 40 CFR 51.100(ii) (1) or (2), the State must notify the public of the availability of the 

demonstration study and must provide opportunity for a public hearing on it. The stack height 

regulation does not restrict in any manner the actual stack height of any source. 

Our analysis of how ADEQ’s NSR submittal addresses the specific requirements for the minor NSR 

program is discussed in detail in Sections 5.2 through 5.6 below. 

3.2 Prevention of Significant Deterioration 

CAA sections 110(a)(2)(C) and 165 establish the general statutory requirements for the PSD program. 

As noted above, 40 CFR 51.166 sets forth EPA’s regulatory requirements for SIP-approved PSD 

programs. The PSD program applies to any regulated NSR pollutant (as defined in 40 CFR 51.166), 

except for pollutants designated nonattainment for a NAAQS. The CAA defines “nonattainment areas” 

as air quality planning areas that exceed the national primary or secondary NAAQS for a given criteria 

pollutant (or that contribute to ambient air quality in a nearby area that does not meet the NAAQS). In 

some instances the emission increases of a particular pollutant may be subject to both the PSD 

program and the NA-NSR program. For example, nitrogen oxides (NOx) from a major stationary source 

in an area designated as attainment for the nitrogen dioxide (NO2) NAAQS and nonattainment for the 

ozone NAAQS could be subject to both permitting programs because, in such cases, NOx would be a 

PSD pollutant as well as a precursor to ozone, a nonattainment pollutant. 

The applicability of PSD to a particular source must be determined in advance of construction or 

modification and is pollutant-specific. The primary criterion is whether the proposed project is 

sufficiently large (in terms of its emissions) to be a major stationary source or major modification, 

terms which are defined as described below. 
Arizona DEQ NSR Program SIP Submittal 

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Section 169 of the CAA specifies the emissions threshold, depending on source category, that is used to 

determine whether a source is a “major emitting facility” and subject to PSD. For PSD purposes, a 

“major stationary source” is any source belonging to a specified list of 28 source categories8that emits 

or has the potential to emit (PTE) 100 tons per year (tpy) or more of any air pollutant subject to 

regulation under the CAA, or belonging to any other source category that emits or has the PTE for such 

pollutants in amounts equal to or greater than 250 tpy. A new source with a PTE at or above the 

applicable “major stationary source threshold” is also subject to PSD for any other regulated NSR 

pollutant emitted in “significant” amounts. These significance levels, which EPA has promulgated for 

criteria pollutants and certain other pollutants, represent a threshold for a de minimis contribution to 

air quality problems. When EPA has not set a significance level for a pollutant, PSD applies to an 

increase of the regulated pollutant in any amount (that is, in effect, the significance level is treated as 

zero). 

PSD also applies to existing major stationary sources that undertake a “major modification,” which 

occurs when: (1) there is a physical change, or change in the method of operation, at a “major 

stationary source;” (2) the change results in a “significant” emissions increase of a pollutant subject to 

PSD regulation (at or above the significance level that EPA has set for the pollutant); and (3) there is a 

“significant net emissions increase” of a pollutant subject to PSD regulation that is at or above the 

significance level (as defined in 40 CFR 51.166(b)(23)). 

The PSD program also applies to greenhouse gas (GHG) emissions when they are “subject to 

regulation,” as defined in 40 CFR 51.166(b)(48).9 

Sources subject to PSD review must demonstrate compliance with a number of approval criteria in 

order to qualify for a PSD pre-construction permit. The most significant of these requirements are the 

application of the best available control technology (BACT) to the source and the requirement that the 

source demonstrate that it will not cause or contribute to a violation of the NAAQS or applicable PSD 

increments. 

Our analysis of how ADEQ’s NSR submittal addresses the specific requirements for SIP-approved PSD 

programs is discussed in section 5.8 below. 

 

8 See 40 CFR 51.166(b)(1)(i) for the 28-source category list. 

9 Emissions of GHGs became subject to regulation under the Clean Air Act on January 2, 2011, and EPA adopted a preconstruction program for regulating GHGs under the PSD program (known as the GHG Tailoring Rule). However, on June 23, 

2014, the U.S. Supreme Court issued a decision in Utility Air Regulatory Group (UARG) v. Environmental Protection Agency

(No. 12-1146) holding that EPA may not treat GHGs as an air pollutant for purposes of determining whether a source is a 

major source required to obtain a PSD permit (or a CAA title V permit) and thus invalidated EPA’s regulations implementing 

that approach. The Supreme Court’s decision also said that EPA could continue to require that PSD permits, otherwise 

required based on emissions of conventional pollutants, contain limitations on GHG emissions based on the application of 

BACT. EPA expects the portions of EPA’s regulations that would require sources emitting only GHGs in major amounts to 

obtain a PSD permit to be vacated by the U.S. Court of Appeals for the District of Columbia Circuit, to which the Supreme 

Court remanded the UARG case for further proceedings. 
Arizona DEQ NSR Program SIP Submittal 

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3.3 Nonattainment NSR

The NA-NSR program under sections 172(c)(5) and 173 of the CAA and EPA’s implementing regulations 

at 40 CFR 51.165 only applies to a particular pollutant, and its precursors, if the area is designated as 

nonattainment for a NAAQS under the CAA for the particular pollutant. The primary criterion for 

applicability of the program is similar to that of the PSD program, that is, whether the proposed project 

is sufficiently large (in terms of its emissions) to be a major stationary source or major modification. 

However, the NA-NSR program has emission thresholds for determining which sources are major 

stationary sources that are different from those of the PSD program, and the NA-NSR program’s 

thresholds vary based on the nonattainment classification of the particular pollutant. 

Generally, a major stationary source in a nonattainment area is defined as a stationary source with a 

PTE of 100 tpy or more of the nonattainment pollutant. The major stationary source emissions 

threshold is lower in nonattainment areas that have been determined to have worse air quality. For 

example, ozone nonattainment areas are classified as being marginal, moderate, serious, severe, or 

extreme (listed in increasing order of the degree of nonattainment). The major source threshold for 

these areas varies between 100 tpy and 10 tpy. 

In contrast to the PSD program, under the NA-NSR program, if a new major stationary source is subject 

to the NA-NSR program requirements, any other regulated NSR pollutant emitted by the major 

stationary source for which the particular area is designated nonattainment triggers NA-NSR 

requirements only if the source is also a major source of that pollutant. 

Modifications to existing major stationary sources (for a particular nonattainment pollutant) are 

subject to the NA-NSR program requirements at similar “significant” emission rates as those described 

above for the PSD program. The significant rate is lower in certain nonattainment areas with worse air 

quality, with the level based on the area’s particular nonattainment classification. 

Once a source is subject to the NA-NSR program, the source must meet several criteria prior to 

receiving a pre-construction permit. The most significant of these requirements are the application of 

the lowest achievable emission rate (LAER) to the source or project and the requirement to offset the 

emission increases from the project with decreases in emissions from other stationary sources. 

Our analysis of how ADEQ’s NSR submittal addresses the specific requirements for NA-NSR programs is 

discussed in Section 5.7 below. 

4. Summary of Arizona’s Submitted Statutory Provisions and Rules

Below is a brief summary of each rule and statutory provision submitted by Arizona for inclusion in the 

Arizona SIP that is under consideration in this action and being reviewed in this TSD. These rules 

represent a comprehensive revision to ADEQ’s stationary source pre-construction permitting program 

and are intended to satisfy the requirements of section 110(a)(2)(C) and parts C and D of title I of the 

CAA for the areas regulated by ADEQ (or agencies delegated authority by ADEQ). In the next sections of 
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the TSD – Section 5, Review of NSR SIP submittal, and Section 6, Review of Non-NSR Related Rules and 

Statutory Provisions – we discuss our more detailed evaluation of the statutory provisions and rules 

submitted by ADEQ as compared with federal NSR requirements for SIP-approved programs. In this 

section we are providing only a summary of the contents of each such statutory provision and rule. 

4.1 Statutory Provisions

A.R.S. § 49-107 – Local delegation of state authority

A.R.S. § 49-107 establishes how the director may delegate state authority to certain local agencies. 

4.2 Rules

The rules under review are found in Articles 1-4 of the Arizona Administrative Code found in Title 18 – 

Environmental Quality, Chapter 2 – Department of Environmental Quality – Air Pollution Control. 

4.2.1 Article 1: General

Rules in Article 1 relate to general definitions used by ADEQ’s air program and materials that have 

been incorporated by reference. 

R18-2-101 – Definitions

This rule contains numerous definitions used by ADEQ’s air program, which also apply to portions of 

ADEQ’s air program beyond permitting. EPA has already approved most of the definitions in R18-2-101 

into the Arizona SIP for ADEQ, in a separate rulemaking action.10 As part of the current SIP action, we 

are reviewing the definitions of the following terms in R18-2-101 (identified as follows by their 

paragraph numbers within R18-2-101), which EPA has not yet acted to approve into the Arizona SIP: (2) 

actual emissions, (32) construction, (87) net emissions increase, (109) potential to emit, and (122) 

regulated NSR pollutant. In addition, we are conducting further review of the following definitions, 

which were previously approved into the Arizona SIP, as they relate to ADEQ’s NSR program and 

Federal NSR requirements (again identified as follows by their paragraph numbers within R18-2-101): 

(13) allowable emissions, (53) federally enforceable, (75) major source, (130) significant, and (139) 

stationary source. 

 

4.2.2 Article 2: Ambient Air Quality Standards; Area Designations;

Classifications

Rules in Article 2 relate to ambient air quality, including establishing ambient air quality standards, area 

classifications, and monitoring methods for ambient air. 

R18-2-217 – Designation and Classification of Attainment Areas

R18-2-217 contains the PSD area classifications (Class I, II, III) for attainment and unclassifiable areas, 

and the process for re-designating the classification of a particular area. 

 

10 See 79 Fed. Reg. 56655 (Sept. 23, 2014).
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R18-2-218 – Limitation of Pollutants in Classified Attainment Areas

R18-2-218 contains the maximum allowed increases in air pollutant concentrations over the baseline 

concentration. These maximum allowable increases are also referred to in the Federal NSR rules as 

increments. The maximum allowable increases vary by area based on the PSD area classification, as 

determined by R18-2-217. The rule also provides the basis for the determination of the baseline 

concentration, the major source baseline dates, and the minor source baseline dates. 

4.2.3 Article 3: Permits and Permit Revisions

Rules in Article 3 – Permit and Permit Revisions – contain administrative permitting procedures used by 

ADEQ to issue permits to major and non-major sources. In addition, Article 3 contains the preconstruction requirements for ADEQ’s newly adopted minor NSR program. 

R18-2-301 – Definitions

R18-2-301 establishes twenty-two definitions that apply specifically to Article 3 – Permits and Permit 

Revisions. 

R18-2-302 – Applicability; Registration; Class of Permits

R18-2-302 provides the basis for determining whether a source is required to obtain a registration or 

permit. Certain stationary sources are required to obtain a registration, a Class I permit or a Class II 

permit based on the potential emissions of the source. In addition, the rule establishes transitional 

requirements for the new registration program until the rule is approved into the SIP.

R18-2-302.01 – Source Registration Requirements

R18-2-301.01 establishes the procedures for submitting applications for registrations for certain minor 

stationary sources, registration processing, how to conduct NAAQS compliance reviews, the required 

contents of registration documents, how to revise a registration and when a registration expires. This 

rule also has a delayed effective date – it does not become effective until the rule is approved into the 

SIP. 

R18-3-303 – Transition from Installation and Operating Permit Program to Unitary Permit Program;

Registration Transition; Minor NSR Transition

R18-2-303 establishes how permits issued prior to September 1, 1993 will be treated and when sources 

will begin to use the new registration program ADEQ is putting into place. Prior to 1993, ADEQ had 

separate pre-construction and operating permit programs. ADEQ has since transitioned to a single (or 

unitary) permitting program that issues pre-construction and operating requirements in a single 

document. 

Rule R18-3-304 – Permit Application Processing Procedures

R18-2-304 applies to Class I and Class II permits and permit revisions. This rule specifies the 

requirements governing the submittal of such permit applications, how to submit a timely application, 

the necessary contents of a complete application, and procedures for the Director’s (referring to 

ADEQ’s director) action on the permit application. 
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R18-2-306 – Permit Contents

R18-2-306 identifies the specific terms and conditions that must be included in Class I and II permits. 

Generally, the requirements of this rule are intended to be consistent with the permit content 

requirement for title V permits in 40 CFR part 70. However, ADEQ also uses requirements in this rule to 

satisfy NSR program requirements. 

R18-2-306.01 – Permits Containing Voluntarily Accepted Emission Limitations and Standards

R18-2-306.01 establishes procedures for sources to take voluntary, permanent emission limits for the 

purposes of avoiding the requirement to obtain a Class I permit or for avoiding one or more otherwise 

applicable requirements. 

R18-2-306.02 – Establishment of an Emissions Cap

R18-2-306.02 provides a process for a stationary source to obtain a source-wide emission cap for a 

particular pollutant. 

R18-2-311 – Test Methods and Procedures

This rule specifies the test methods and procedures that can be used to determine compliance with 

requirements established in Chapter 2 of ADEQ’s rules (ADEQ’s air program) or contained in permits 

issued pursuant to Chapter 2.

R18-2-312 – Performance Tests

This rule requires stationary sources to conduct a performance test within 60 days of achieving the 

capability to operate at their maximum production rate, but no later than 180 days after initial startup. The rule also specifies that testing shall be conducted under such conditions specified by State, 

including, but not limited to appropriate test methods, notification to the State, data reduction, 

records, and number of test runs.

R18-2-315 – Posting of Permit

R18-2-315 requires persons granted a permit to post the permit or certificate of permit issuance at the 

location where the relevant equipment was installed and to keep a copy of the complete permit onsite. 

In addition, each piece of equipment must be clearly marked to include the current permit number or 

serial number listed in the permit for the piece of equipment. 

R18-2-316 – Notice of Building Permit Agencies

R18-2-316 requires agencies issuing or granting building permits or approvals to evaluate whether a 

project requires an air pollution permit and, if so, provide written notice to the applicant to contact the 

Director. 

R18-2-319 – Minor Permit Revisions

R18-2-319 specifies the types of changes that can qualify as a minor permit revision for Class I and 

Class II permits, when sources can make the changes qualifying as minor permit revisions, the 

requirements for minor permit revision applications, and, for Class I permits, EPA and affected state 

review. For Class I permits, the rule also includes issuance timeframes and procedures for the Director. 
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R18-2-320 – Significant Permit Revisions

R18-2-320 identifies the types of permit revisions that must be processed as significant permit 

revisions and procedures for issuing such permit revisions. 

R18-2-321 – Permit Reopenings; Revocation and Reissuance; Termination

R18-2-321 contains the procedures for reopening or terminating a permit for cause and the reasons a 

permit may be opened or terminated for cause. 

R18-2-323 – Permit Transfers

R18-2-323 provides the procedures for requesting to transfer a permit to another person. The Director 

may deny such requests and such decisions are appealable. 

R18-2-330 – Public Participation

R18-2-330 identifies the types of actions that require the Director to provide public notice, opportunity 

for public comments, and opportunity for a public hearing. The rule also includes the information that 

must be included in a public notice and the procedures for issuing such notifications. 

R18-2-332 – Stack Height Limitation

R18-2-332 provides the calculation and basis for determining good engineering practice (GEP) stack 

height and requires that the degree of emission limitation required by a source shall not be affected by 

a stack height that exceeds GEP. 

R18-2-334 – Minor New Source Review 

R18-2-334 is a newly adopted rule by ADEQ for preconstruction permitting of minor sources (“minor 

NSR”). The rule identifies the types of actions subject to minor NSR permitting, the emission control 

requirements for minor NSR permit actions and the requirements for an ambient air quality 

assessment. This rule will not be implemented until approved into the SIP. 

4.2.4 Article 4: Permit Requirements for New Major Sources and Major

Modifications to Existing Major Sources

Title 18, Chapter 2, Article 4 of ADEQ’s rules includes ADEQ’s NSR program requirements for major 

sources. 

R18-2-401 – Definitions

R18-2-401 includes twenty-six definitions that apply specifically to Article 4 – Permit Requirements for 

New Major Sources and Major Modification to Existing Major Sources. 

R18-2-402 – General

R18-2-402 provides the basic requirements for determining applicability of the major NSR program, the 

requirements for permit applications under the major NSR program, and the basic procedures the 

Director must use for issuing permits under the major NSR program. The rule includes the 

requirements that must be met when there is a reasonable possibility of a significant emission 

increase, even though the project did not trigger the major NSR program, when projected actual 

emissions are calculated. 
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R18-2-403 – Permits for Sources Located in Nonattainment Areas

R18-2-403 establishes the specific preconstruction review requirements for issuing a permit to a new 

major stationary source or major modification located in a nonattainment area. The nonattainment 

NSR program applies only to the particular pollutant, and its precursors, for which the area is 

designated nonattainment. 

R18-2-404 – Offset Standards

R18-2-404 contains the standards for obtaining the offsets that are required by R18-2-403 in 

nonattainment areas. 

R18-2-405 – Special Rule for Major Sources of VOC or Nitrogen Oxides in Ozone Nonattainment Areas

Classified as Serious or Severe

Rule R18-2-405 contains certain requirements that apply only to VOC and NOX emissions for major 

sources in areas designated as serious or severe ozone nonattainment. 

Rule R18-2-406 – Permit Requirements for Sources Located in Attainment and Unclassifiable Areas

R18-2-406 contains key NSR requirements applicable to major sources and major modifications located 

in attainment and unclassifiable areas – generally referred to as the PSD program. 

R18-2-407 – Air Quality Impact Analysis and Monitoring Requirements 

R18-2-407 contains the portion of the PSD program requirements that relates to air quality impact 

analyses and ambient air monitoring requirements. 

R18-2-412 – PALs

R18-2-412 contains the provisions for establishing plantwide applicability limits – also known as PALs. 

The PAL provisions are used to set source-wide emission limits for a particular pollutant to avoid the 

major NSR requirements. 

5. Review of NSR SIP Submittal

5.1 Summary – NSR Permitting Program – 40 CFR 51.160 through 51.166

In evaluating the ADEQ submittal that is the subject of this action, EPA reviewed ADEQ’s submitted 

rules and statutory provisions listed in Table 1 above for compliance with the CAA requirements for 

SIPs in general as set forth in CAA section 110(a)(2), the requirements for stationary source 

preconstruction permitting programs in 40 CFR part 51, subpart I (Review of New Sources and 

Modifications), and the requirements related to SIP revisions in CAA sections 110(l) and 193. EPA has 

summarized the approval criteria contained in these various materials in this TSD, which describes the 

basis for our proposed action on the submitted NSR rules. 

EPA’s detailed evaluation of whether and how ADEQ meets the specific elements required in 40 CFR 

part 51, subpart I for SIP approval of an NSR program is included in Attachment 1 to this TSD – 

Evaluation of 40 CFR 51.160-51.166 and the ADEQ NSR Submittal (Evaluation). This TSD provides a 
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summary of our evaluation of each rule under review for this action and highlights issues identified in 

our Evaluation, as appropriate. Generally, only those issues that warrant a more detailed discussion are 

included in the TSD. 

In light of the findings made in our Evaluation and further discussed in this TSD, we are generally 

proposing a limited approval and limited disapproval of ADEQ’s minor NSR program, PSD program, and 

NA-NSR program. The rules submitted for each of these CAA program requirements as a whole 

significantly strengthen the Arizona SIP and update the State’s SIP-approved NSR programs so that they 

are more consistent with current CAA requirements for SIP-approved NSR programs. However, we 

have identified a number of discrepancies between ADEQ’s submittals for each of these programs and 

the CAA requirements governing such programs that warrant disapproval, as the discrepancies result in 

ADEQ’s NSR programs not meeting some aspects of the CAA requirements for SIP-approved NSR 

programs. These discrepancies must be addressed by the State in order for EPA to grant full approval 

of the programs. In addition, we are proposing a limited approval for a portion of ADEQ’s NA-NSR 

program based on requirements of section 189(e) of the Act related to the permitting of major sources 

of PM10 and PM2.5 precursors. We are also proposing disapproval of two specific aspects of ADEQ’s PSD 

program submittal (and one identical aspect of ADEQ’s NA-NSR program) that are analogous to 

provisions in the federal regulations that have recently been vacated by federal Courts and which are 

separable from the remainder of the program. These issues are discussed further below and in our 

Evaluation. 

Finally, we note that rules R18-2-311 and 312 are addressed separately, in Section 6.0, from the 

requirements for an NSR program as they are not specifically a part of ADEQ’s NSR program. These two 

rules represent general air program requirements under section 110(a)(2) of the Act. We are also 

proposing a limited approval and limited disapproval of these rules. We have also reviewed A.R.S. § 49-

107, which is not specific to the NSR program, and propose to approve into the Arizona SIP, as 

discussed further below. 

5.1.1. Description of ADEQ’s Minor NSR Program

The minor NSR program requirements in 40 CFR 51.160-51.164, apply to stationary sources generally, 

including minor sources and non-major modifications of major and minor sources. 40 CFR 51.160, 

51.161, and 51.163 in particular provide broad discretion for States to develop permitting programs for 

such sources and modifications that meet these requirements. Here we provide a description of 

ADEQ’s preconstruction permitting and related requirements that apply to minor sources and to nonmajor modifications of major and minor sources. 

The substantive requirements of ADEQ’s minor NSR program are contained in R18-2-302.01 – Source 

Registration Requirements and R18-2-334 – Minor New Source Review. First, R18-2-302.01 requires 

new and existing stationary sources with potential emissions lower than the threshold that would 

require them to obtain a Class I or Class II permit to obtain a preconstruction registration from with 

ADEQ. Sources are subject to this program based on their potential to emit (without the consideration 

of elective controls or limits on operation) regulated NSR pollutants in amounts equal to or greater 
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than specific permitting exemption thresholds set by ADEQ that are discussed below in Section 5.2.2. 

Each application for a registration will be reviewed by ADEQ to determine whether it will interfere with 

attainment or maintenance of the NAAQS. This analysis will be based on source-specific 

considerations. Sources may also use the registration to take elective limits (to avoid obtaining a Class 

II permit) to reduce their potential to emit. These elective limits cannot be used to avoid the 

requirement to obtain a registration. A source required to register is generally subject to the public 

notice requirements in R18-2-330. 

R18-2-334 generally requires preconstruction review for the construction or modification of a 

stationary source that has, or is required to obtain, a Class I or II permit, where the emissions increase 

would be equal to or greater than the “permitting exemption thresholds” in R18-2-101(99). A Class I 

permit is generally required for sources with the potential to emit a criteria pollutant at or above 100 

tons per year, and a Class II permit is generally required for sources with the potential to emit a criteria 

pollutant at or above the PSD “significant” rates. However, applicability of R18-2-334 is triggered on a 

pollutant-specific basis for each NSR pollutant with an emissions increase above the permitting 

exemption threshold, but not subject to major NSR. See R18-2-334(A)(2)-(3). R18-2-334 requires 

sources subject to the rule to either apply reasonably available control technology (RACT) for emissions 

units with potential emissions (or the potential to increase emissions, for modifications) in an amount 

at least 20% higher than the permitting exemption threshold or conduct an ambient air quality analysis 

to demonstrate the source would not interfere with attainment or maintenance of the state’s ambient 

air quality standards. The rule requires public notice in certain circumstances. In addition, sources that 

have already obtained a registration under R18-2-302.01 become subject to R18-2-334 upon an 

increase in potential emissions that triggers the requirement to obtain a Class II permit. See R18-2-

302(B)(2)(b) and R18-2-302.01(G)(1). 

5.2. 40 CFR 51.160 – Legally Enforceable Procedures

40 CFR 51.160 contains the basic CAA SIP requirements for States establishing programs to prevent the 

construction or modification of sources that would interfere with the State’s control strategy or would 

interfere with attainment and maintenance of the NAAQS. Our Evaluation identifies how ADEQ’s 

submittal addresses each of the current specific requirements in 40 CFR 51.160. Except as discussed 

below in Sections 5.2.1 and 5.2.2.3, we find that ADEQ’s submittal meets these Federal program 

requirements, through requirements established in the following ADEQ rules reviewed for the NSR SIP 

submittal: R18-2-101(2), (32), (87), (109), and (122); R18-2-301, R18-2-302, R18-2-302.01, R18-2-304, 

R18-2-306, R18-2-306.01, R18-2-306.02, R18-2-316, R18-2-334, R18-2-401, R18-2-402, R18-2-403, R18-

2-406 and R18-2-409. In addition, our review relied on existing SIP-approved provisions in R18-2-101 

and R9-3-101(20). While some of the definitions used for ADEQ’s NSR program are already approved 

into ADEQ’s SIP at R18-2-101, which applies broadly to ADEQ’s air program, in this action, we 

reconsidered those definitions within the specific context of the federal NSR program’s requirements. 
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5.2.1 Limited Approval and Limited Disapproval Issues under 40 CFR

51.160(a) – (d), (f)

We are proposing a limited approval and limited disapproval of ADEQ’s minor NSR program, in part 

because it is not fully consistent with the requirements of 40 CFR 51.160(a)–(d) and 40 CFR 51.160(f), 

as described below. We find that approval of ADEQ’s updated minor NSR program, will substantially 

strengthen the SIP overall, as the submitted minor NSR program generally has more extensive 

requirements for minor sources and non-major modifications than the current SIP-approved program 

and lower permitting threshold will provide additional mechanisms for protecting the NAAQS, as well 

as update the SIP with current State regulations. See our discussion in Section 8. However, specific 

provisions of the minor NSR program submittal are inconsistent with minor NSR program 

requirements, and these deficiencies must be addressed before we can fully approve ADEQ’s minor 

NSR program into the SIP. The deficiencies that we have identified with ADEQ’s minor NSR program 

that provide the basis for our limited approval and limited disapproval are described below. Approval 

issues under 40 CFR 51.160(e) are discussed separately in Section 5.2.2. 

40 CFR 51.160(a) and (b)

These federal regulatory provisions require that ADEQ’s SIP set forth legally enforceable procedures 

that enable the State (or local) agency to determine whether the construction or modification of a 

source will result in a violation of applicable portions of the control strategy or interference with 

attainment or maintenance of the NAAQS in the state in which the proposed source or modification is 

located or in a neighboring State, and that these procedures include means by which the agency 

responsible for final decisionmaking on an application for approval to construct will prevent such 

construction or modification if it will result in such violation or interference. 

ADEQ’s program does not fully satisfy this requirement as it allows certain sources to begin 

construction when a “proposed final permit” is issued by ADEQ, rather than preventing construction 

until a final permit has been issued. See R18-2-101(114), R18-2-302(G), R18-2-334(B), R18-2-402(C). 

The definition for “proposed final permit” in R18-2-101 does not specify that such an action is a final 

decision for NSR purposes. As a result, the program does not provide ADEQ with clear authority to 

prevent construction or modification before it issues a final decision on the request for authority to 

construct as is required per 40 CFR 51.160(a) and (b). ADEQ has clarified that, in effect, under ADEQ’s 

rules, a proposed final permit is treated as a final authorization to construct, and that it will treat 

proposed final permit as a final, appealable agency action under Arizona law.11 Nevertheless, a 

revision to ADEQ’s NSR program is necessary to ensure that these types of permit actions clearly serve 

as a final authority to construct in order to satisfy the federal NSR program requirement that the 

agency be able to prevent construction until and unless it has issued a final decision on the request for 

authority to construct. 

 

11 See ADEQ Memo – Proposed Final Permits to be Treated as Appealable Agency Actions, dated February 10, 2015 and 

ADEQ’s February 23, 2015 Supplement at 2. 
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40 CFR 51.160(a)(2) and (b)(2)

ADEQ’s program does not contain adequate enforceable procedures to ensure compliance by sources 

subject to review under its NSR program with all national standards,12 for a number of reasons. First, 

although NAAQS is a defined term in ADEQ’s regulations, see R18-2-101(85), ADEQ’s NSR program 

generally does not refer to the NAAQS and instead generally references the State’s ambient air 

standards in Article 2 of ADEQ’s air program. See R18-2-302.01, R18-2-334, and R18-2-406.13 Also, in 

some instances, ADEQ’s NSR regulations simply refer to Arizona ambient air quality standards with no 

specific reference to Article 2, which makes the applicable standards ambiguous.14 See R18-2-218, 

R18-2-406, and R18-2-407. 

Second, in some instances ADEQ’s NSR program does not ensure that a source would not interfere 

with attainment or maintenance of the NAAQS in neighboring areas outside ADEQ’s permitting 

jurisdiction, as is required under 40 CFR 51.160(a) and (b), as the State air standards are not generally 

applicable in neighboring States,15 and the NSR Program submittal does not demonstrate that they are 

applicable in neighboring States for purposes of ADEQ’s NSR program. See R18-2-302.01(C); R18-2-

334(C)(2), (F), and (G); and R18-2-406(A)(5)(a) and (b). 

Third, for minor sources subject to permitting under R18-2-334, the rule does not meet these federal 

requirements as it does not require ADEQ to evaluate whether the project under review will interfere 

with attainment or maintenance of the NAAQS in all cases, and instead allows sources to apply RACT in 

lieu of such an evaluation and, in some cases, appears to allow sources with lower levels of emissions 

to avoid both substantive NAAQS review and RACT requirements. See R18-2-334(C)(1)(a)-(b). ADEQ has 

not demonstrated that this approach ensures that all sources subject to review under its NSR program 

will not interfere with attainment or maintenance of the NAAQS. While R18-2-334(G) allows Director’s 

discretion to require a NAAQS analysis on a case-by-case basis, we find this discretion too great to 

ensure compliance with this requirement. Finally, R18-2-302.01(C)(4) needs to include a reference to 

“or maintenance” of a standard, instead of just “attainment of a standard.” 

To obtain full approval, ADEQ must ensure that the sources reviewed under its program will not 

interfere with attainment or maintenance of the NAAQS in all areas, for all construction or 

modifications subject to review under ADEQ’s NSR program, including review of potential air quality 

impacts from Arizona sources’ emissions in neighboring states and local districts where ADEQ is not the 

permitting authority. In addition, references to ambient air quality standards in ADEQ’s NSR rules 

 

12 We interpret this requirement to be referring to the NAAQS. 

13 ADEQ’s list of state air standards does not contain the current PM2.5 annual NAAQS of 12 μg/m3 PM2.5. See 78 Fed. Reg. 

3086 (Jan. 13, 2013). This is not a disapproval issue for ADEQ’s minor NSR and NA-NSR programs, which have three years to 

adopt programs implementing the new NAAQS. However, as discussed in Section 5.8.2, the new NAAQS is applied 

immediately upon its effective date to sources subject to the PSD program.

14 For example, R18-2-407(B) contains “any such pollutant for which no Arizona ambient air quality standard exists.” 

“Arizona ambient air quality standard” is not a defined term in ADEQ’s regulations. 

15 See, for example, the definition of “attainment area” in R18-2-101, limiting attainment areas to those in Arizona. A.R.S. 

§ 49-106 provides, in relevant part: “The rules adopted by the department apply and shall be observed throughout this 

state, or as provided by their terms, and the appropriate local officer, council or board shall enforce them.” 
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should use consistent terminology to the extent ADEQ continues to rely on references to the state 

standards for its NSR program. Finally, R18-2-302.01(C)(4) needs a reference to “or maintenance” of a 

standard. 

40 CFR 51.160(b)(1) 

For sources subject to ADEQ’s registration program at R18-2-302.01, ADEQ has not demonstrated that 

its NSR program meets the requirement to ensure that sources subject to NSR review comply with the 

applicable portions of the control strategy as required by 40 CFR 51.160(b)(1). This requirement is 

nearly met by R18-2-302.01(E), except that the provision lacks sufficient language to “ensure 

compliance” with applicable requirements, similar to language in R18-2-306(A)(2).To obtain full 

approval ADEQ must ensure that sources subject to R18-2-302.01 will comply with the applicable 

portions of the control strategy. 

40 CFR 51.160(c)

ADEQ’s registration program in R18-2-302.01 does not contain enforceable procedures for the owner 

or operator to submit the necessary information for ADEQ to determine whether a source will violate 

the applicable control strategy or interfere with attainment or maintenance of the NAAQS as required 

by 40 CFR 51.160(c). R18-2-302.01(A)(3) requires applicants to calculate a source’s uncontrolled 

potential to emit, but then references provisions in another rule, R18-2-327(C), that are used to 

calculate “actual” emissions. As such, ADEQ’s program contains conflicting procedures for calculating 

potential emissions. The potential emissions of the source will be used by ADEQ to ensure the source is 

not violating the control strategy or interfering with attainment or maintenance of the NAAQS. In 

addition, rule R18-2-327, is not in the Arizona SIP, and has not been submitted to EPA for SIP approval. 

To obtain full program approval, ADEQ must ensure that potential emissions under R18-2-302.01 are 

calculated consistent with the definition of “uncontrolled potential to emit” in ADEQ’s rules, and that 

the regulations governing the method to be used for such calculations are approved into the SIP.16 

40 CFR 51.160(c)(1)

ADEQ’s program does not meet the requirement that the applicant submit information related to the 

nature and amounts of emissions, for certain kinds of emissions units as required by 40 CFR 

51.160(c)(1). For Class I and Class II permits, R18-2-304(E)(9) allows sources to avoid providing emission 

information for “insignificant activities,” as defined in R18-2-101(68). The term “insignificant activities” 

is generally associated with the title V program. Many of the activities listed in ADEQ’s definition of 

insignificant activity are for activities that would not be expected to emit regulated NSR pollutants. 

However, this is not true for all activities, such as those listed under R18-2-101(68)(a-c) that include 

liquid storage tanks, combustion engines, and “low-emitting processes.” 

 

16 If ADEQ would like to provide additional clarity on where a source should obtain emission factor information for 

calculating potential emissions (e.g., use of AP-42), then such information would likely be appropriate to include in R18-2-

302.01. 
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To obtain full NSR program approval, ADEQ must ensure that Class I and Class II permit applications 

contain all emissions information associated with a particular project in order to determine whether 

R18-2-334 or Article 4 (major source NSR requirements) applies. 

40 CFR 51.160(d)

For sources subject to R18-2-302.01, ADEQ’s program does not meet the requirement in 40 CFR 

51.160(d) that its procedures provide that approval of construction or modification will not affect the 

responsibility of the owner or operator to comply with applicable portions of the control strategy. To 

obtain full program approval, ADEQ must ensure that its NSR procedures meet this requirement for 

sources subject to R18-2-302.01. 

40 CFR 51.160(f)(1)

For sources subject to ADEQ’s registration program under R18-2-302.01, ADEQ’s program does not 

meet the requirement to use Appendix W to 40 CFR part 51 for air quality modeling. To obtain full 

program approval ADEQ must ensure that air quality modeling under R18-2-302.01 uses Appendix W.17

5.2.2 ADEQ’s Minor NSR Program and 40 CFR 51.160(e)

ADEQ’s minor NSR program is intended to meet the requirements of 40 CFR 51.160, and encompasses 

several ADEQ rules. As discussed above, generally, 40 CFR 51.160 requires States to adopt a program 

and corresponding procedures for preventing the approval of the construction or modification of 

certain facilities, buildings, structures, or installations, or combinations thereof, if such construction or 

modification: 

1. Will result in a violation of the applicable control strategy; or 

2. Will interfere with the attainment or maintenance of a national standard. 

The minimum requirements for this program are considerably more general than those applicable for 

major sources in attainment and nonattainment areas under 40 CFR 51.165 and 51.166. As noted 

above, a more detailed discussion of our review of ADEQ’s minor NSR rules and how they meet the 

specific elements of 40 CFR 51.160 is available in our Evaluation. 

40 CFR 51.160(e) requires ADEQ to provide a basis for the types and sizes of facilities, buildings, 

structures, or installations that will be subject to review under 40 CFR 51.160. As such, 40 CFR 

51.160(e) allows state NSR programs to exclude some new minor sources and minor modifications 

from the NSR program. Such exclusions are appropriate so long as such sources and modifications are 

not environmentally significant, consistent with the de minimis exemption criteria set forth in Ala. 

 

17 We approve of ADEQ’s determination to use screening modeling for sources subject to the registration program, 

specifically AERSCREEN. Nonetheless, screening techniques must be consistent with Appendix W. 
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Power Co. v. Costle, 636 F.2d 323, at 360-361 (D.C. Cir. 1979).18 Below, we discuss our evaluation of 

the basis provided by ADEQ for the types and sizes of facilities, buildings, structures or installations it 

will subject to review under its minor NSR program. 

5.2.2.1 Summary of Sources Subject to Review under ADEQ’s Minor NSR 

Program 

Historically, ADEQ’s minor NSR program required permitting of new or modified non-major sources 

causing an increase in potential emissions of a criteria pollutant at or above the significant emission 

rates under the PSD program in 40 CFR 51.166(b)(23)(i). In a May 22, 1996 letter to ADEQ, EPA Region 

9 indicated that the significant emission rates used by ADEQ for its minor NSR permitting program did 

not represent an acceptable threshold for applying the basic preconstruction requirements for minor 

sources for purposes of the NSR program. To address EPA’s concerns, ADEQ assessed other potential 

lower permitting thresholds for its minor NSR program and selected revised thresholds for its minor 

NSR program following this assessment. ADEQ provided its basis for the selected thresholds in its 

October 29, 2012 SIP submittal, which we summarize below. 

As part of its assessment of possible thresholds, ADEQ prepared a comparison of the permitting 

thresholds of minor NSR programs for nearby western states with air quality issues similar to the areas 

under ADEQ’s jurisdiction. (California was not included, because of the unique severity of the 

nonattainment problems in that state.) Below is Table 3 showing that ADEQ’s historic minor source 

NSR permitting thresholds were generally higher than those applicable in surrounding areas. We also 

show ADEQ’s new minor source NSR thresholds, as well as the minor NSR thresholds in EPA’s Tribal 

Minor NSR rule that have recently become applicable in Tribal areas regulated under that rule (see 

Table 1 to 40 CFR 49.153), for comparison. 

 

18 While the Alabama Power court discusses the de minimis principle in the context of a Federal administrative agency’s 

authority in promulgating rules to satisfy statutory requirements, the same principle can be applied where a State 

promulgates rules to satisfy requirements by a Federal administrative agency. With regards to the de minimis principle, the 

Alabama Court writes: “Determination of when matters are truly de minimis naturally will turn on the assessment of 

particular circumstances, and the agency will bear the burden of making the required showing. But we think most 

regulatory statutes, including the Clean Air Act, permit such agency showings in appropriate cases. While the difference is 

one of degree, the difference of degree is an important one. Unless Congress has been extraordinarily rigid, there is likely a 

basis for an implication of de minimis authority to provide exemption when the burdens of regulation yield a gain of trivial 

or no value. That implied authority is not available for a situation where the regulatory function does provide benefits, in 

the sense of furthering the regulatory objectives, but the agency concludes that the acknowledged benefits are exceeded 

by the costs. For such a situation any implied authority to make cost-benefit decisions must be based not on a general 

doctrine but on a fair reading of the specific statute, its aims and legislative history.” See Ala. Power Co. v. Costle, 636 F.2d 

323, at 360-361 (D.C.Cir. 1979).
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Table 3 Comparison of Permitting Thresholds for other Programs 

State PM10 PM2.5* NOX SO2 CO VOC Lead

Arizona (Historic) 15 -- 40 40 100 40 0.6

Colorado (attainment) 5 5 10 10 10 5 0.1

Colorado (nonattainment) 1 1 5 5 5 2 0.1

Nevada 2 -- 2 2 -- 2 -- 

Clark County, Nevada 5 -- 10 25 25 10 0.3

New Mexico 25 25 25 25 25 25 25

Utah 5 -- 5 5 5 5 -- 

Tribal Minor NSR – attainment 5 3 10 10 10 5 0.1

Tribal Minor NSR -

nonattainment 1 0.6 5 5 5 2 0.1

Arizona (New) 7.5 5 20 20 50 20 0.3

* Many programs, including ADEQ’s, did not address PM2.5 until after the 2008 PM2.5 Implementation Rule. 

In the Tribal Minor NSR rule, EPA stated that the permitting thresholds for its minor NSR program are 

“not intended to establish a new set of minimum criteria that a Tribe or a state would need to follow in 

developing its own minor source permitting program.” See 76 Fed. Reg. 38754 (Jul. 1, 2011). Thus, the 

thresholds in the Tribal Minor NSR rule are not binding in any way on States or tribes developing their 

own minor NSR programs. Nevertheless, the approach taken by EPA in developing the thresholds in the 

Tribal Minor NSR Rule represents one approach that EPA has found to be appropriate in establishing 

such thresholds. 

To assess the impact of the thresholds in the Tribal Minor NSR rule, EPA conducted a source 

distribution analysis using data from the National Emissions Inventory. The analysis concluded that the 

percentage of emissions that would be exempt under the Tribal Minor NSR rule’s thresholds would be 

small (less than 1.5% of total emissions for each pollutant), while these thresholds would require only 

14-58% of stationary sources (varying based on the individual pollutant) to obtain permits or register. 

EPA’s analysis determined this approach provided “evidence that sources with emissions below the 

proposed minor NSR thresholds will be inconsequential to attainment and maintenance of the 

NAAQS.” See 71 Fed. Reg. 48701-03 (Aug. 21, 2006). 

To assess potential thresholds for its minor NSR program, ADEQ applied a similar approach to a local 

data set. During the stakeholder process, ADEQ proposed two alternative scenarios for minor NSR 

thresholds: one that generally used 1⁄2 of the PSD significant rates and one that generally used 1⁄4 of the 

PSD significant rates. See Table 4. 
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Table 4 Revised Permitting Thresholds Evaluated by ADEQ 

Pollutant Scenario 1 

(1/2 Significant Rate)

Scenario 2 

(1/4 Significant Rate)

CO 50 25

NOX 20 10

SO2 20 10

VOC 20 10

PM10 7.5 5

Lead 0.3 0.3

ADEQ used the Maricopa County 2006 emissions inventory to analyze the potential impact of 

implementing each of these two scenarios for areas within ADEQ’s jurisdiction. Because of the severity 

of the air quality problems in the Phoenix Metropolitan Area, Maricopa County has for some time 

employed much lower permitting thresholds than ADEQ has and therefore has a much more complete 

inventory of smaller emission sources than does ADEQ. ADEQ’s emissions inventory is limited to 

stationary sources with potential emissions at the PSD significant rates. Due to the lack of available 

data for minor stationary sources under ADEQ’s jurisdiction, it is reasonable for ADEQ to use a nearby 

emissions inventory for this analysis. 

The results of ADEQ’s analysis are in Table 5 below. 

Table 5 Results of ADEQ’s Stationary Source Distribution Analysis 

Scenario 1 CO NOX Pb PM10 SO2 VOC

% of emissions regulated 34.86 78.38 0 79.47 22.19 59.96

% of sources regulated 2.06 7.6 0 12.57 0.59 8.85

Scenario 2 CO NOX Pb PM10 SO2 VOC

% of emissions regulated 56.86 85.65 0 84.22 72.57 75.89

% of sources regulated 5 13.16 0 15.52 4.13 16.49

Based on the Maricopa County data, using Scenario 2 (generally 1/4 of the PSD significant emission 

rate) for the minor NSR emission thresholds rather than Scenario 1 (generally 1/2 of the PSD significant 

emission rate) would result in significantly more coverage of carbon monoxide and sulfur dioxide 

emissions under ADEQ’s minor NSR program. However, ADEQ stated that stationary source emissions 

of carbon monoxide are generally dwarfed by mobile source emissions and do not contribute 

significantly to nonattainment of the carbon monoxide NAAQS. Also, ADEQ reasoned that in the areas 

within Arizona that are subject to ADEQ’s minor NSR program, the sources that could contribute to 

noncompliance with the sulfur dioxide NAAQS are well-defined and consist of large industrial sources 

already subject to the permitting program. ADEQ concluded, based on the above considerations, that 

for purposes of minor NSR, use of the Scenario 2 thresholds would not offer any substantial benefits 

over Scenario 1. In addition, ADEQ determined that the Scenario 1 thresholds will bring ADEQ’s 
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program more in line with those of neighboring states, as summarized above. ADEQ concluded that the 

minor source thresholds in Scenario 1, shown in Table 4 above, were the appropriate thresholds for its 

minor NSR program, and adopted rules establishing these thresholds. 

As such, EPA has evaluated ADEQ’s minor NSR program for compliance with the requirements in 40 

CFR 51.160, 51.161, and 51.163 by considering those regulatory requirements that apply to 

construction or modifications at stationary sources at or above ADEQ’s permitting exemption threshold 

(Scenario 1 above). This is the threshold ADEQ has adopted as necessary and appropriate for meeting 

the minor NSR requirements. Our review of ADEQ’s analysis of minor sources to regulate under 40 CFR 

51.160(e) applies to only those areas for which ADEQ has permitting jurisdiction of minor sources. That 

is, other areas of the State may need a minor NSR program of a different scope under 40 CFR 51.160(e) 

to address the particular air quality issues and concerns of such areas. 

Section 5.2.2.2 Other Sources Exempted from ADEQ’s Minor NSR Program 

In addition to the permitting thresholds discussed above, ADEQ’s program also exempts other 

equipment under R18-2-302(C) from the requirement to obtain a permit or registration “unless the 

source is a major source, or unless operation without a permit would result in a violation of the Act.” 

The exempted equipment includes (1) a stationary source that consists solely of a single categorically 

exempt activity plus a combination of trivial activities and (2) agricultural equipment used in normal 

farm operations. ADEQ’s rules states that “agricultural equipment used in normal farm operations” 

does not include equipment classified at a source that requires a permit under title V of the Act, or that 

is subject to a standard under 40 CFR 60, 61, or 63. In response to an EPA comment on item (1) above, 

ADEQ’s submittal demonstrated that the list of categorically exempt activities were below ADEQ’s 

permitting exemption threshold. EPA approves of ADEQ’s determination for this exemption. However, 

ADEQ’s exemption of agricultural equipment appears to be based on a state law related to permitting 

– A.R.S. § 49-426(B), which states: 

The provisions of this section shall not apply to motor vehicles, to agricultural vehicles or 

agricultural equipment used in normal farm operations, or to fuel burning equipment which, at 

a location or property other than a one or two family residence, is rated at less than one million 

British thermal units per hour. The director may establish by rule additional sources or 

classifications of sources for which a permit is not required and pollutant-emitting activities and 

emissions units at permitted sources that are not required to be included in the permit. The 

director shall not adopt such rules unless the director makes a written finding with supporting 

facts that the exempted source, class of sources, pollutant-emitting activities or emissions units 

will have an insignificant adverse impact on air quality. In adopting these rules, the director may 

consider any rule that is adopted by the administrator pursuant to section 502 of the clean air 

act and that exempts one or more source categories from the requirement to obtain a permit 

under title V of the clean air act. 

Below, we identify disapproval issues with ADEQ’s approach under 40 CFR 51.160(e). 

 
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5.2.2.3 Program Elements Subject Limited Approval and Limited Disapproval 

under 40 CFR 51.160(e) 

In sum, ADEQ’s analysis looked at the percentage of emissions that can be regulated at two thresholds 

and concluded “both scenarios result in a relatively large percentage of emissions being subject to 

regulation compared to the percentage of sources brought into the program.” We generally agree with 

ADEQ on this point as it relates to ADEQ’s requirement to select a level of emissions to regulate as part 

of its program. While we find ADEQ’s approach to meeting 40 CFR 51.160(e) generally acceptable, we 

find that certain aspects of the approach are not consistent with Federal NSR requirements, and are 

proposing a limited approval and limited disapproval of ADEQ’s minor NSR program, in part, based on 

these issues. Specifically, ADEQ’s NSR SIP submittal is deficient under 40 CFR 51.160(e) for the 

following reasons. 

First, ADEQ’s submittal does not provide a clear basis that the permitting thresholds selected by ADEQ 

will ensure a sufficient percentage of minor sources are subject to review in nonattainment areas. As 

ADEQ points out in its submittal, ADEQ’s analysis is based on data for Maricopa County19, which has 

lower NSR permitting thresholds than those adopted by ADEQ due to its local air quality problems. In 

addition, (1) some of the other permitting programs in Table 3 above have lower permitting thresholds 

in nonattainment areas than those applicable in attainment areas under their jurisdiction; (2) in looking 

at a similar analysis of minor source emissions for another permitting program in Region 9, which has 

local air quality problems, the permitting agency generally set thresholds that include a larger 

percentage of emissions in the NSR program than the percentage included in ADEQ’s program20; and 

(3) typically, nonattainment areas have more control requirements that apply to smaller minor 

sources, as compared to attainment areas. As such, ADEQ’s basis does not clearly address how the 

proposed permitting thresholds adequately addresses nonattainment areas.21 

Second, while EPA agrees that, in general, certain types of equipment may be exempted from the 

minor NSR program, ADEQ must provide a basis under 40 CFR 51.160(e) to demonstrate that 

regulation of the equipment exempted in R18-2-302(C) and A.R.S. § 49-426(B) is not needed for 

ADEQ’s program to meet federal NSR requirements for attainment and maintenance of the NAAQS or 

review for compliance with the control strategy. Such demonstration must address: 

 

19 ADEQ does not have jurisdiction for permitting of minor sources in Maricopa County, AZ. 

20 See EPA’s Technical Support Document for Revision of Air Quality Implementation Plan; California; Sacramento 

Metropolitan Air Quality Management District; Stationary Source Permits, 78 Fed. Reg. 10589 (Feb. 2, 2014) at 6-7 

describing the thresholds applicable in Sacramento as generally excluding less than 5% of the emissions inventory except 

for SO2, 

21 In addressing this deficiency, ADEQ does not necessarily have to consider lower permitting exemption thresholds in 

nonattainment areas. For example, ADEQ could provide further analysis to demonstrate that the adopted thresholds are 

appropriate for nonattainment areas or consider a different approach, such as requiring minor sources in nonattainment 

areas subject to a SIP requirement for the nonattainment pollutant, or its precursors, to obtain a registration, if ADEQ can 

demonstrate that such an approach would serve to satisfy the requirements of 40 C.F.R. 51.160. 
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1. An explanation of whether the regulatory exemption in R18-2-302(C) for “agricultural 

equipment used in normal farm operations” constitutes an interpretation or refinement of the 

exemption for such sources in A.R.S. § 49-426(B), and how the two provisions apply to ADEQ’s 

NSR program. 

2. Identification of the types of equipment ADEQ considers to be “agricultural equipment used in 

normal farm operations” and whether this type of equipment could potentially be expected to 

occur at a stationary source subject to title V of the Act, 40 CFR parts 60, 61, or 63, or major 

NSR, and, if so, whether such equipment is subject to NSR review at such sources. 

3. ADEQ’s basis for determining that “agricultural equipment used in normal farm operations” 

does not need to be regulated as part of ADEQ’s minor NSR program under 40 CFR 51.160(e). 

4. ADEQ’s interpretation of the exemption for fuel burning equipment in A.R.S. § 49-426(B) and 

how it does, or does not, apply in the context of its major and minor NSR programs, and, to the 

extent such equipment is not subject to NSR review, ADEQ’s basis for determining that 

equipment exempted under this provision does not need to be reviewed as part of ADEQ’s 

minor NSR program under 40 CFR 51.160(e). 

Third, ADEQ’s minor NSR program sets a permitting exemption threshold for PM2.5 of 5 tons per year, 

but ADEQ’s analysis does not provide a basis for this threshold. 

To obtain full program approval, ADEQ must (1) demonstrate that the chosen permitting exemption 

thresholds are appropriate for nonattainment areas, or revise the thresholds, or revise other portions 

of the minor NSR program, if necessary; (2) provide further explanation of, and an adequate basis 

under 40 CFR 51.160(e) for, the exemptions for agricultural equipment used in normal farm operations 

in R18-2-302(C) and A.R.S. § 49-426(B), and fuel burning equipment in A.R.S. § 49-426(B); and (3) 

provide the basis for the PM2.5 permitting exemption threshold.22 

Section 5.2.3 Recommendations

 

In addition to the disapproval issues identified above in this section, i.e., Sections 5.2.1 and 5.2.2.3, our 

Evaluation identifies recommendations for correcting typographical errors and making other small 

revisions to ADEQ’s rules to provide additional clarity and consistency with the federal requirements23. 

Specifically, we note: 

1. ADEQ should consider adding a reference to R18-2-409 – Air Quality Models in R18-2-334 and 

R18-2-302.01. 

 

22 Addressing this deficiency does not necessarily mean ADEQ must re-evaluate its PM2.5 permitting exemption threshold 

or reconsider Maricopa’s emissions inventory, if ADEQ is able to provide a reasonable basis for its selection of 5 tons per 

year. 

23 We note that the issues discussed solely in the context of EPA “recommendations” in this Technical Support Document 

and/or our Evaluation reflect EPA suggestions for improving ADEQ’s regulatory provisions. Such issues are not bases for our 

proposed limited disapproval in this action. 
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2. ADEQ should consider submitted the current version of Appendix 1 to replace the current 

outdated version in the SIP. 

5.3 40 CFR 51.161 – Public Availability of Information

40 CFR 51.161 contains the basic requirements for public participation for the NSR program.24 Our 

Evaluation identifies how ADEQ’s submittal addresses each of the requirements in 40 CFR 51.161. 

Except as discussed below, ADEQ’s program generally meets these federal NSR requirements through 

requirements established in the following rules reviewed for its NSR SIP submittal: R18-2-302.01, R18-

2-330, R18-2-334, R18-2-401, and R18-2-402. 

However, we are proposing a limited approval and limited disapproval of ADEQ’s program because: 

40 CFR 51.161(a)

ADEQ’s program does not ensure that NSR review for all minor sources regulated under ADEQ’s NSR 

program, as ADEQ defines it pursuant to 40 CFR 51.160(e), is subject to public notice and comment 

consistent with 40 CFR 51.161(a). 40 CFR 51.161(a) requires that the program under 51.160 provide for 

public comment on the information submitted by owners or operators. In addition, the public 

information must include ADEQ’s analysis of the effects of construction or modification on ambient air, 

including ADEQ’s proposed approval or disapproval. ADEQ’s program does not meet this requirement 

because: (1) “modification” of existing sources that become subject to the registration program under 

R18-2-302.01 (currently only “construction” of a source) are not subject to public notice (see R18-2-

302.01(B)(3)); (2) R18-2-334(G) exempts most modifications from public notice; (3) R18-2-330 does not 

clearly define which public notice requirements apply to registrations; and (4) public participation does 

not appear to be required for a proposed disapproval of an application for any portion of ADEQ’s NSR 

program (registration, minor NSR, or major NSR). 

To obtain full approval, ADEQ must ensure that public notice and opportunity for comment is required 

for all portions of ADEQ’s federal NSR program under 40 CFR 51.160(e), clarify the public notice 

procedures in R18-2-330 that apply to registrations, and ensure that proposed disapprovals are subject 

to public notice. We do not interpret 40 CFR 51.161(a) as allowing exceptions to the public notice 

requirements in any circumstance for the program that is defined under 40 CFR 51.160. 

40 CFR 51.161(a)

ADEQ’s registration program at R18-2-302.01(F) does not contain enforceable procedures for sources 

taking “elective limits” to limit their potential to emit in a manner that allows the source to avoid the 

public participation requirements in 40 CFR 51.161(a), while otherwise being subject to the registration 

program. See R18-2-302.01(B)(3)(b) and R18-2-302(E)(1). While this rule contains requirements for 

monitoring, recordkeeping, and reporting of elective limits, these requirements are not sufficiently 

 

24 The federal PSD program includes additional public participation requirements for sources subject to PSD review. These 

requirements are discussed in Section 5.8 below. 
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enforceable for purposes of limiting the source’s potential to emit, and thereby avoiding public notice, 

as well other substantive requirements of ADEQ’s minor NSR program. In order to meet basic practical 

enforceability requirements for limiting PTE, R18-2-302.01(F) must also contain (1) a technically 

accurate limitation and the portions of the source subject to the limitation and (2) the time period for 

the limitations (hourly, daily, monthly, etc.). Further, if the limitation is over a period longer than daily, 

R18-2-302.01(F) must specify when to compile daily records to show compliance with the elected limit. 

See, for example, EPA’s guidance on limiting potential to emit: 

http://www.epa.gov/reg3artd/permitting/limitPTEmmo.htm and 

http://www.epa.gov/region7/air/nsr/nsrmemos/potoem.pdf. 

To obtain full program approval, ADEQ must impose additional requirements to ensure public 

availability of information when limiting PTE by rule, including: 

· A technically accurate limitation and the portions of the source subject to the limitation25; 

· Specifying the time period over which the elective limit applies (e.g. daily, monthly); 

· If the limitation is a period longer than daily, then monitoring and recordkeeping must be 

added to require compiling of daily records to show compliance.

40 CFR 51.161(b)(1)

ADEQ’s NSR program does not ensure, for all sources subject to NSR review, the availability for public 

inspection in at least one location in the area affected of the information submitted by the owner or 

operator and of ADEQ’s analysis on the effect on air quality as required by this federal regulation. R18-

2-330(D)(11) requires the public notice to identify the nearest ADEQ office where documents can be 

inspected, but there are only two department offices for ADEQ. We do not interpret this provision as 

meeting the requirement to make information available in the “area affected.” In addition, the public 

notice requirements do not make reference to providing ADEQ’s analysis for public inspection. 

Potentially, this is covered by “all other materials available to the Director that are relevant to the 

permit decision”.26 But it is not clear that ADEQ would interpret this to mean the Director’s own 

analysis. To obtain full approval, ADEQ’s NSR program must ensure that the necessary documents will 

be available for public inspection in the “area affected” by the action, including the Director’s analysis 

of the effects on ambient air quality.27

 

25 We recognize that ADEQ’s procedures may be too generic to meet this requirement in a way that is approvable into the 

SIP. ADEQ’s approach of allowing the applicant to specify the limit without any public or EPA review in the SIP rule or the 

registration does not meet the enforceability criteria for limiting PTE. EPA is willing to work with ADEQ to develop 

approvable standards for limiting PTE in the SIP. However, if ADEQ is unable to revise the rule at this time to meet this 

criteria, then other portions of ADEQ’s rules must be revised to remove public notice exemptions, and exemptions from any 

other substantive minor NSR requirements, for sources using these elective limits. 

26 This requirement is met for ADEQ’s registration program at R18-2-302.01(B)(3)(a). 

27 For example, one option could be to provide information in the notice for a local library where the public in the affected 

area could access the Internet, and then also provide a specific web address where the permitting materials can be 

inspected. The affected area could then go to their local library to access the permitting documents. 
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40 CFR 51.161(d)

ADEQ’s NSR program does not provide notice to the necessary parties identified in 40 CFR 51.161(d) 

for sources required to obtain registrations under R18-2-302.01. This requirement is met for sources 

regulated under the other portions of ADEQ’s NSR program at R18-2-334(H) and R18-2-402(I)(2). To 

obtain full approval, ADEQ’s NSR program at R18-2-302.01 should be revised to provide the required 

notices in 40 CFR 51.161(d). 

5.4. 40 CFR 51.162 – Identification of Responsible Agency

40 CFR 51.162 requires that each SIP identify the State or local agency that will be responsible for 

meeting the requirements of 40 CFR 51, Subpart I – the NSR program. ADEQ supplemented its NSR SIP 

submittal on July 2, 2014 to address this element. ADEQ’s jurisdiction is governed by A.R.S. § 49-402(A) 

and (B). Section 49-402(A) provides ADEQ unconditional original jurisdiction over five stationary source 

categories: smelting of metal ores, coal fired electric generating stations, petroleum refineries, 

Portland cement plants, and portable sources. This jurisdiction applies throughout the state regardless 

of whether the source is located in a county with its own air pollution control agency. ADEQ may 

delegate its jurisdiction for these sources to the local county program. We provide additional 

information concerning NSR jurisdiction within the state, as follows. 

Jurisdiction over Major Sources 

Under A.R.S. § 49.402(A)(1), ADEQ has original jurisdiction over major sources in any county that has 

not received approval from the Administrator for new source review and PSD under the Act. ADEQ 

interprets this provision as requiring a county air pollution control agency to have EPA approval for 

both nonattainment NSR and PSD (which can include delegation of this program from EPA) in order to 

have jurisdiction over major sources. 

Jurisdiction over Minor Sources 

Under A.R.S. § 49-402(B), counties or multi-county air quality control regions have jurisdiction for all 

sources not identified in A.R.S. § 49-402(A), unless ADEQ asserts jurisdiction. Historically, ADEQ 

asserted jurisdiction over Apache, Cochise, Coconino, Gila, Mohave, Navajo, Santa Cruz, Yavapai, and 

Yuma counties. There is not a record that ADEQ specifically asserted jurisdiction over Graham, 

Greenlee, and La Paz counties, but these programs never adopted air quality permitting programs and 

ADEQ has assumed jurisdiction. ADEQ does not have currently have jurisdiction for minor sources in 

Maricopa, Pima and Pinal Counties. 

ADEQ also has statutory authority under A.R.S. § 49-107 to delegate its authority to administer the 

State air quality program to county or other local government agencies.28 

ADEQ’s jurisdiction to implement the NSR SIP submittal is summarized below in Table 6. “Original” or 

“asserted” refers to areas where ADEQ currently has jurisdiction over the identified source category. 

 

28 See ADEQ’s Supplemental Information submitted on July 2, 2014 at 4, Section 2.1. 
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Table 6 Summary of Permitting Jurisdiction in Arizona 

Area Source Categories ADEQ

Jurisdiction

County

Jurisdiction

Maricopa 

County 

Smelting of metal ores 

Original None 

Coal fired electric generating stations 

Petroleum refineries 

Portland cement plants 

Portable sources 

All other major and minor sources None Original 

Pima County 

Smelting of metal ores 

Original None 

Coal fired electric generating stations 

Petroleum refineries 

Portland cement plants 

Portable sources 

Sundt Generating Station Original Delegated 

Rosemont Copper Mine (Minor 

Source) Asserted None 

All other major and minor sources None Original 

Pinal County 

Smelting of metal ores 

Original None 

Coal fired electric generating stations 

Petroleum refineries 

Portland cement plants 

Portable sources 

Major Sources Original Delegated 

All other minor sources None Original 

Rest of State All Original None 

 

5.5. 40 CFR 51.163 – Administrative Procedures

40 CFR 51.163 requires each NSR program to include administrative procedures that will be followed in 

making the determinations specified in 40 CFR 51.160(a). Our Evaluation identifies how ADEQ’s 

submittal addresses each of the requirements in 40 CFR 51.163. ADEQ’s program meets this 

requirement through various provisions in R18-2-302, R18-2-302.01, R18-2-304, R18-2-306, R18-2-334, 

R18-2-402, and Appendix 129 (already SIP-approved). However, ADEQ’s submittal contains references 

to other ADEQ rules – R18-2-317 and R18-2-317.02 – that are not in the SIP and have not been 

submitted for SIP approval. See R18-2-306.02(D), R18-2-319(I), R18-2-304(J), R18-2-306(A), and R18-2-

306.02(D). To obtain full program approval, ADEQ must ensure that all of the administrative 

procedures referenced by ADEQ’s NSR program are submitted for inclusion into the SIP. 

 

29 Appendix 1 contains ADEQ’s standard permit application form and filing instructions. Appendix 1 was last SIP-approved 

in the 1980s. We recommend that ADEQ submit the current version for approval into the SIP to replace the existing version. 
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In addition, we recommend that ADEQ include an additional procedure in R18-2-302.01 that allows the 

Director to request additional information. While ADEQ intends to have a form for registrations, which 

could contain all necessary information, it does not appear that this form has been created yet. 

5.6. 40 CFR 51.164 – Stack Height Provisions

40 CFR 51.164 requires each NSR program to include certain procedures related to stack heights, 

including good engineering practice (GEP) stack height provisions. Our Evaluation identifies how 

ADEQ’s submittal addresses each of the requirements in 40 CFR 51.164. In addition to reviewing 

ADEQ’s submittal as compared with the NSR program requirements of 40 CFR 51.164, we also 

reviewed ADEQ’s submittal as it relates to certain general SIP program requirements in 40 CFR 51.100 

and 51.118. The stack height provisions in the NSR program rely on the general stack height provisions 

in 40 CFR 51.118(b), which in turn references the definitions in 40 CFR 51.100(hh) through (kk), and 

therefore our evaluation of ADEQ’s program with respect to these provisions was necessary to 

determine whether ADEQ’s program satisfied the requirements in 40 CFR 51.164 (see our Evaluation

for a detailed comparison). Except as discussed below, ADEQ’s submittal generally meets these stack 

height and related requirements through requirements established in the following rules reviewed for 

the NSR SIP submittal: R18-2-301, R18-2-332, and R18-2-401. 

5.6.1 Stack Height Program Elements Subject to Limited Approval and

Limited Disapproval

We are proposing a limited approval and limited disapproval of ADEQ’s minor NSR program submittal 

in part due to the following deficiencies in the program with respect to the requirements in 40 CFR 

51.164: 

40 CFR 51.164 and 51.118(a)

ADEQ’s submittal does not meet the public hearing requirements in 40 CFR 51.164. While R18-2-332(E) 

contains a reference to holding a public hearing, when required, the provision references ADEQ’s 

public hearing provision in R18-1-402. R18-1-402 is not in the SIP and has not been submitted for SIP 

approval. In order to obtain full approval, ADEQ must either reference public hearing provisions in the 

SIP or submit R18-2-401 for SIP approval. 

40 CFR 51.118(b)

ADEQ’s submittal does not contain language that meets the exception in 40 CFR 51.118(b): “except 

where pollutants are being emitted from such stacks or using such dispersion techniques by sources, as 

defined in section 111(a)(3) of the Clean Air Act, which were constructed, or reconstruction, or for 

which major modifications, as defined in §§51.165(a)(1)(v)(A), 51.166(b)(2)(i) and 52.21(b)(2)(i), were 

carried out after December 31, 1970.” In addition, R18-2-332(A)(3) incorrectly references July 1, 1975 

instead of July 1, 1957. To obtain full program approval, ADEQ must ensure that its submittal contains 

the exception described above and correct the reference to July 1, 1957. 
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40 CFR 51.100(ii)(2)(i)

ADEQ’s submittal does not contain a requirement that owners or operators seeking to rely on the 

equation in 40 CFR 51.100(ii)(2)(i) produce evidence that the equation was actually relied on in 

establishing an emission limitation. To obtain full program approval, ADEQ must ensure its definition 

for good engineering practice stack height at R18-2-332(B)(2) is consistent with the definition in 40 CFR 

51.100(ii)(2)(i). 

R18-2-332(D)

ADEQ’s submittal contains a provision at R18-2-332(D) which provides additional provisions for sources 

“seeking credit because of plume impaction which results in concentrations in violation of national 

ambient air quality standards or applicable maximum allowable increases.” This provision is not 

contained in the federal regulations and appears to allow for the use of stack heights beyond GEP stack 

height, as defined in 40 CFR 51.100(ii). To obtain full program approval, ADEQ must ensure that its 

program meets the GEP stack height definition in 40 CFR 51.100(hh) in all respects. 

Section 5.6.2 Recommendations

 

In addition to the disapproval issues identified above in this section, at Section 5.6.1, our Evaluation

identifies recommendations for correcting typographical errors and making other small revisions to 

ADEQ’s rules to provide additional clarity and consistency with the federal requirements. All of our 

recommendations are provided in the Evaluation, but we specifically note: 

1. ADEQ should consider revising R18-2-332(B)(1) to include “measured from the ground level,” 

for consistency with the federal regulation at 40 CFR 51.100(ii). 

2. ADEQ should consider removing the reference to R18-2-403 from R18-2-332(B)(2). The need for 

this reference is unclear. 

3. ADEQ should consider revising R18-2-332(B)(4) to reference “terrain features” instead of 

“terrain obstacles” for consistency with the federal regulation at 40 CFR 51.100(ii)(3). 

4. ADEQ should consider revising R18-2-332(B)(6)(a) to reference “R18-2-406” instead of “Article 

4.” 

5. ADEQ should consider revising R18-2-332(B)(6)(b) to add “or, in the absence of such a limit, the 

actual emission rate” for consistency with the federal regulation at 40 CFR 51.100(kk)(2). 

5.7. 40 CFR 51.165 – Permit Requirements (NA-NSR)

40 CFR 51.165 identifies the requirements for SIP-approved nonattainment NSR programs under 

sections 172(c)(5) and 173 of the Act. Generally, each source or modification subject to the program 

requirements must obtain a preconstruction permit that ensures that the Lowest Achievable Emission 

Rate (LAER) is met and that sufficient offsets in emission reductions are obtained. 

We have conducted a detailed review of ADEQ’s NSR SIP submittal as compared with the federal 

requirements for SIP-approved NA-NSR programs in 40 CFR 51.165. ADEQ’s NSR SIP submittal generally 

incorporates the federal NA-NSR program requirements through the date on which ADEQ’s rule 
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revisions to the NSR program were proposed, that is, July 6, 2012. However, as discussed below, there 

have been some changes to the federal NA-NSR program requirements since this date as a result of 

court decisions and/or regulatory actions by EPA. 

Our Evaluation identifies how ADEQ’s submittal addresses each of the current specific requirements in 

40 CFR 51.165. Except as discussed in Sections 5.7.1 through 5.7.3 below, we find that ADEQ’s 

submittal meets the NA-NSR program requirements through requirements established in the following 

ADEQ rules reviewed for the NSR SIP submittal: R18-2-101(2), (32), (87), (109), and (122); R18-2-401; 

R18-2-402; R18-2-403; R18-404; R18-405; and R18-2-406. In addition, our review relied on existing SIP 

approved provisions in R18-2-101 and R9-3-101(20). While some of the definitions required by the NANSR program are already approved into ADEQ’s SIP at R18-2-101, which applies broadly to ADEQ’s air 

program, we reconsidered those definitions within in the context of the NA-NSR program. 

Although ADEQ’s submittal meets most NA-NSR program requirements, we are proposing to 

disapprove one specific aspect of ADEQ’s NA-NSR program relating to the definition of “basic design 

parameter.” The ADEQ rule provision that we are proposing to disapprove is directly comparable to a 

federal NA-NSR rule provision that has been vacated by a federal court, and we find that it is separable 

from the remainder of ADEQ’s NA-NSR program. Accordingly, we find this provision suitable for 

disapproval at this time. This issue is described in more detail below in Section 5.7.1. 

For most of the remainder of ADEQ’s NA-NSR program submittal, we are proposing limited approval 

and limited disapproval. We find that approval of ADEQ’s updated NA-NSR program, aside from the 

aspects that is separable and is proposed for disapproval as mentioned above, will substantially 

strengthen the SIP overall, particularly as the current SIP-approved NA-NSR program is significantly out 

of date when compared with current federal NA-NSR regulatory requirements as well as current State 

regulations. See our discussion in Section 8. However, specific provisions of the NA-NSR SIP program 

submittal are inconsistent with NA-NSR program requirements, and these deficiencies must be 

addressed before we can fully approve ADEQ’s NA-NSR program into the SIP. The deficiencies that we 

have identified with ADEQ’s NA-NSR program that provide the basis for our limited approval and 

limited disapproval are described below in Section 5.7.2. 

For one other aspect of ADEQ’s NA-NSR SIP submittal, we are proposing limited approval at this time. 

We cannot determine at this time whether ADEQ’s NA-NSR SIP submittal adequately addresses all of 

elements necessary to satisfy the CAA’s title I, part D, subpart 4 requirements regarding NSR permitting 

of PM2.5 and PM10 precursors under CAA section 189(e). This issue is discussed in detail in Section 5.7.3 

below. 

As noted above, we have determined that all other aspects of ADEQ’s submitted NA-NSR program 

meet the requirements of 40 CFR 51.165. An item warranting additional discussion is described below 

in Section 5.7.4; however, it is not an issue that warrants limited approval or disapproval action. 

We note that in many cases, ADEQ has adopted definitions and program requirements that apply to 

both the NA-NSR and PSD programs, as 40 CFR 51.165 and 51.166 contain many of the same, or 
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similar, requirements. For example, ADEQ’s R18-2-402 – General – contains the basic requirement for a 

major source or major modification to obtain a preconstruction permit, and how to determine whether 

a modification is a major modification. ADEQ then addresses the more program-specific requirements 

in separate NA-NSR and PSD rules that it has adopted. Because of the overlapping requirements of the 

two programs, in some instances we are proposing full or limited disapproval under both the NA-NSR 

and PSD programs for the same requirement in ADEQ’s NSR submittal. We evaluated each program 

separately, so we are identifying the NA-NSR program issues in this section of the TSD – Section 5.7 – 

and address the PSD program issues in Section 5.8 of the TSD. 

5.7.1 Definition for Basic Design Parameter

ADEQ’s submittal contains a definition for basic design parameter at R18-2-401(3) that reflects the 

definition that EPA originally developed as part of its Equipment Replacement Provisions. See 68 Fed. 

Reg. 61248 (Oct. 27, 2003). However, the definition for basic design parameter, and other elements 

related to the Equipment Replacement Provisions, were vacated by the D.C. Circuit Court of Appeals in 

State of New York v. EPA, 443 F.3d 880 (D.C. Cir. 2006). While the federal NA-NSR regulations still 

contain a reference to “basic design parameter,” this term is no longer specifically defined under the 

federal NA-NSR regulations, and application of the definition contained in the Equipment Replacement 

Provisions that were vacated by the Court of Appeals is inconsistent with federal NA-NSR 

requirements. As the Court of Appeals found this Equipment Replacement Provisions and, therefore, 

this definition, impermissible, and because ADEQ’s regulation incorporating this definition is a 

separable portion of ADEQ’s NA-NSR program, we are proposing a partial disapproval of ADEQ’s 

submitted NA-NSR program, to disapprove R18-2-401(3). 

5.7.2 NA-NSR Program Elements Subject to Limited Approval and Limited

Disapproval

As discussed above, we are generally proposing a limited approval and limited disapproval of ADEQ’s 

NA-NSR program, aside from the specific ADEQ rule provision that we are proposing to disapprove as 

described above.30 We are proposing this approach because while ADEQ’s NA-NSR program generally 

satisfies federal NA-NSR requirements, and as described in more detail in Section 8, approving the 

updated ADEQ NA-NSR regulations into the Arizona SIP will substantially strengthen the Arizona SIP 

overall by generally bringing the regulatory requirements in the SIP up to date, we have identified a 

number of deficiencies that will not allow us to fully approve the program as currently submitted.31

Our limited disapproval of ADEQ’s NA-NSR program is based on the issues described below. 

 

30 We are also proposing limited approval for certain aspects of ADEQ’s NA-NSR program for PM2.5 and PM10 based on 

issues relating to Part D, subpart 4 of the Act, as described in Section 5.7.4 below. 

31 We note that, as described above in Sections 5.2 – 5.6 of this document, certain aspects of ADEQ’s NA-NSR program 

also do not fully satisfy the required program elements for the so-called federal “minor NSR program” as it applies to 

sources subject to the NA-NSR program. We will not repeat those issues here, but note that certain of ADEQ’s NA-NSR 

program elements must be revised to satisfy federal minor NSR program requirements as well as NA-NSR requirements. 
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References to Articles 9 and 11 in ADEQ’s submittal 

ADEQ’s NSR submittal often refers to Articles 9 and/or 11 of ADEQ’s regulations where the federal 

regulations refer to 40 CFR parts 60, 61, or 63; or, similarly, sections 111 or 112 of the Act. See R18-2- 

101(122)(b); R18-2-401(10); R18-2-402(G)(2); and R18-2-406(A)(4). Articles 9 and 11 are where ADEQ 

incorporates by reference the federal regulations in 40 CFR parts 60, 61, and 63 (which EPA 

implements under sections 111 and 112 of the Act). However, these Articles are not in the SIP, have 

not been submitted for SIP approval, and do not necessarily contain provisions equivalent to all of the 

subparts in parts 60, 61, and 63. In order to obtain full program approval, ADEQ must ensure its SIPapproved program adequately encompasses the requirements in 40 CFR parts 60, 61, or 63, and 

sections 111 and 112 of the Act, where these provisions are referenced by the required NA-NSR 

provisions in: 40 CFR 51.165(a)(1)(xiii) – lowest achievable emission rate, (a)(1)(xxxvii) – regulated NSR 

pollutant, and (a)(1)(xl) – best available control technology. 

40 CFR 51.165(a)(1): Definitions 

ADEQ’s submittal contains definitions applicable to the NA-NSR program that do not fully meet 40 CFR 

51.165(a)(1), which requires each State plan to contain specific definitions for the NA-NSR program. 

Deviations from the wording are approvable if the State specifically demonstrates that the submitted 

definition is more stringent, or at least as stringent, in all respects as the corresponding definition in 40 

CFR 51.165(a)(1). The definitions for ADEQ’s NA-NSR program are found in R18-2-101 and R18-2-401. 

We have carefully reviewed the definitions included in the submittal as compared with the federal NANSR definitions in 40 CFR 51.165(a)(1) and have found that generally, ADEQ’s submittal contains the 

definitions necessary to implement a NA-NSR program. However, a number of ADEQ’s definitions do 

not meet the requirements of 40 CFR 51.165(a)(1) because their wording deviates from the wording in 

the corresponding federal regulatory definitions in 40 CFR 51.165(a)(1) in a manner that appears to be 

less stringent than the federal definitions, and the State has not demonstrated otherwise. 

In addition to the broader deficiencies identified above that also apply to the definitions in the NA-NSR 

program, the definitions that do not meet the requirements of 40 CFR 51.165(a)(1) are listed below. In 

most cases, these ADEQ definitions meet most aspects of the federal definition but contain minor 

changes in wording or missing pieces of the definition that make ADEQ’s definition less stringent than 

the federal definition in some respects. Our Evaluation specifically identifies the portions of these 

ADEQ definitions that appear to be inconsistent with the corresponding Federal definitions and 

provides more detail. In order to obtain full NA-NSR program approval, ADEQ must either revise the 

following definitions to conform to the wording in the federal regulation or otherwise demonstrate 

that they are at least as stringent as the federal regulatory definition in all respects: 

Definitions: 

· 40 CFR 51.165(a)(1)(i) Stationary source – the federal regulation at 40 CFR 51.165(a)(1)(i) 

defines this term as “any building, structure, facility or installation which emits or may emit a 

regulated NSR pollutant,” with “regulated NSR pollutant” also being a federally defined term at 

40 CFR 51.165(a)(1)(xxxvii), whereas ADEQ’s regulation at R18-2-101(139) defines “stationary 

source” as “any building, structure, facility or installation subject to regulation pursuant to 

A.R.S. § 49-426(A) which emits or may emit any air pollutant,” with “air pollutant” being an 
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undefined term in ADEQ’s regulation. However, A.R.S. § 49-426(A) provides a cross-reference to 

certain exemptions from permitting identified in A.R.S. § 49-426(B), specifically agricultural 

equipment used in normal farm operations and certain fuel burning equipment, which do not 

appear to be consistent with federal NA-NSR definition. The federal definition of stationary 

source at 40 CFR 51.165(a)(1)(i) is very broad and does not exclude these source categories 

from the definition. We agree that it is acceptable for ADEQ to limit its NSR program to certain 

kinds of stationary sources, as discussed in detail above in Section 5.2.2 with respect to 40 CFR 

51.160(e), but the federal definition for a stationary source in the context of the major NA-NSR 

program is not the appropriate place for such an exclusion, as it does not allow exclusions for 

certain source categories. For full approval of ADEQ’s NA-NSR program into the SIP, ADEQ must 

demonstrate that its definition of stationary source is at least as stringent as the federal 

definition at 40 CFR 51.165(a)(1)(i) in all respects. 

· 40 CFR 51.165(a)(1)(iv) Major stationary source – language from subparagraph 40 CFR 

51.165(a)(1)(iv)(A)(3) not included in the definition at R18-2-101(75); also see comments above 

on definition of “stationary source” in 40 CFR 51.165(a)(1)(i). 

· 40 CFR 51.165(a)(1)(vi) Net emissions increase – 

o The requirement of paragraph 40 CFR 51.165(a)(1)(vi)(E)(3) is not met because not all 

requirements to be approved under subpart I are listed (i.e., R18-2-302.01) in the 

definition at R18-2-101(87). 

o The equivalent of paragraph 40 CFR 51.165(a)(1)(vi)(G) is not included in ADEQ’s 

definition at R18-2-101(87) 

· 40 CFR 51.165(a)(1)(x) Significant – ADEQ’s definition at R18-2-101(130)(b) refers to R18-2-405 

for determining significant emissions in serious and severe ozone nonattainment areas. The 

definition for “significant” at R18-2-405(B) does not use the term “net emissions increase,” 

which is a term defined by the federal regulations at 40 CFR 51.165(a)(1)(vi). 

· 40 CFR 51.165(a)(1)(xi) Allowable emissions – ADEQ’s definition at R18-2-101(13)(b) does not 

include the “future compliance date” language that is in 40 CFR 51.165(a)(1)(xi)(B) and (C) and 

ADEQ has not demonstrated that its regulatory language is at least as stringent as the federal 

definition. 

· 40 CFR 51.165(a)(1)(xiv) Federally enforceable – ADEQ’s definition at R18-2-101(53)(d) 

identifies that requirements included in permits pursuant to R18-2-306.01 or R18-2-306.02 are 

included in the definition of federally enforceable requirements, but excludes those 

requirements that are identified as “enforceable only by the state.” With this action, we are 

approving R18-2-306.01 and R18-2-306.02 into the SIP, making requirements pursuant to these 

rules federally enforceable. As such, ADEQ does not have the discretion to identify some of 

those requirements as only enforceable by the state. 

· 40 CFR 51.165(a)(1)(xxxvii) Regulated NSR pollutant –ADEQ’s definition is missing this language 

from paragraph 40 CFR 51.165(a)(1)(xxxvii)(C): “provided that such constituent or precursor 

pollutant may only be regulated under NSR as part of regulation of the general pollutant” at 

R18-2-101(122)(a).

· 40 CFR 51.165(a)(1)(xxviii) Projected actual emissions – ADEQ’s definition at R18-2-

401(20)(b)(iii) does not specifically require inclusion of emissions from malfunctions in the 
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determination of projected actual emissions, and exempts emissions from a shutdown 

associated with a malfunction from such determination, while the federal definition at 40 CFR 

51.165(a)(1)(xxxvii)(C) requires that emissions from both shutdowns and malfunctions be 

included. 

40 CFR 51.165(a)(2) – Applicability procedures 

The NA-NSR program requirements at 40 CFR 51.165(a)(2) require each plan to have a preconstruction 

review program to satisfy the requirements of sections 172(c) and 173 of the Act. However, ADEQ’s 

submittal allows a source at R18-2-302(G) and R18-2-402(C) to begin actual construction upon the 

issuance of a proposed final permit. As previously discussed in Section 5.2.1, ADEQ’s program is 

ambiguous as to whether a proposed final permit, as defined in R18-2-101(114), constitutes final 

action by the Director. While ADEQ has issued guidance clarifying that it treats “proposed final 

permits” as final actions for purposes of preconstruction permitting32, in order to obtain full NA-NSR 

program approval, ADEQ’s regulations must make clear that a source may not begin actual 

construction before a final determination on an NA-NSR permit application is made by the Director. 

40 CFR 51.165(a)(3)(ii)(G) – Claiming credit for emission reductions 

This federal rule provision requires that credit for emission reductions can be claimed only to the 

extent that the reviewing authority has not relied on it in issuing any permit under regulations 

approved pursuant to 40 CFR 51 subpart I or the State has not relied on it in demonstration of 

attainment or reasonable further progress. ADEQ’s NSR submittal generally addresses this requirement 

at R18-2-404(H), but also needs to include references to rules R18-2-302.01 and R18-2-334, which are 

to be approved as part of ADEQ’s NSR regulations under Subpart I.

40 CFR 51.165(a)(6)-(7) – Source obligation 

This portion of the program requires a NA-NSR program to require sources to meet certain obligations, 

including those related to reasonable possibility. 

· 40 CFR 51.165(a)(6) – ADEQ’s submittal contains an apparent typographical error in R18-2-

402(F)(1)(c), which includes a cross-reference to R18-2-401(20)(b)(iii) rather than R18-2-

401(20)(b)(iv). To obtain full NA-NSR program approval, this error must be corrected to ensure 

that the requirement in 40 CFR 51.165(a)(6)(i)(c) for owners and operators to document and 

maintain a record of certain applicability-related information is satisfied. 

· 40 CFR 51.165(a)(7) – ADEQ’s submittal does not require owners or operators to make 

information required under 40 CFR 51.165(a)(6) available for review upon request by the 

Director or the general public pursuant to the requirements in 40 CFR 70.4(b)(3)(viii) as is 

required by 40 CFR 51.165(a)(7). To obtain full NA-NSR program approval, ADEQ must add this 

requirement. 

 

32 See ADEQ Memo dated February 10, 2015 related to proposed final permits, and ADEQ’s February 23, 2015 Supplement 

at 2. 
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40 CFR 51.165(a)(9)(i) – Minimum emission offset requirements 

This federal rule provision requires that increases in emissions shall be offset by reductions in 

emissions using a ratio of emission decreases to emission increases of at least 1 to 1. ADEQ’s NSR 

submittal contains this requirement at R18-2-404(A), but could be interpreted as establishing the ratio 

as increases to decreases, instead of decreases to increases – “emission increases shall be offset by 

emission decreases at a ratio of at least 1 to 1.” In addition, R18-2-404(A) refers to additional offset 

requirements in R18-2-405, but does not refer to the offset requirement in R18-2-404(J). To obtain full 

program approval ADEQ must clarify its regulatory language to ensure the correct offset ratio is used 

and to ensure that R18-2-404(A) also refers to the offset requirements in 404(J). 

40 CFR 51.165(a)(11) – Interprecursor offsets

This federal rule provision requires emission offsets to be obtained for the same regulated NSR 

pollutant, unless interprecursor offsetting is permitted for a particular pollutant, as further specified in 

the rule. ADEQ’s NSR SIP submittal does not address interprecursor offsets, and it is not required to, 

but the submittal does not contain a specific requirement that offsets must be for the same regulated 

pollutant. To obtain full program approval ADEQ must clarify its regulatory language to ensure offsets 

must be obtained for the same regulated NSR pollutant, consistent with 40 CFR 51.165(a)(11). 

40 CFR 51.165(b)(1) and (2) – Program requirements for sources in attainment areas 

These federal rule provisions require that ADEQ have a preconstruction program that satisfies the 

requirements of section 110(a)(2)(D)(i) of the Act for any new major stationary source or major 

modification that would locate in an attainment area, but would cause or contribute to a violation of a 

NAAQS in any adjacent area. ADEQ’s program contains provisions for 40 CFR 51.165(b) at R18-2-

406(A)(5)(a)-(b) that generally meet this requirement. However, ADEQ’s regulations at R18-2-

406(A)(5)(b) refer to the “Arizona primary or secondary ambient air quality standards,” which is not a 

defined term, whereas the analogous federal program provisions refer to the NAAQS. As a result, 

ADEQ’s program does not fully meet the requirements in 40 CFR 51.165(b)(1) and (2) as ADEQ’s 

regulations do not make clear which standards are being referred to, and the submittal does not 

demonstrate that such standards would apply to areas outside of Arizona for purposes of ADEQ’s NSR 

review. Similarly, ADEQ’s regulation at R18-2-406(A)(5)(a) references the state’s ambient air quality 

standards in Article 2, which would not clearly apply to areas outside of Arizona. 

 

40 CFR 51.165(f) – Actuals PALs 

This portion of the NA-NSR program regulations contains requirements for establishing a plantwide 

applicability limit to avoid the requirement to obtain a NA-NSR permit. To obtain full NA-NSR program 

approval, ADEQ must address the following deficiencies in the Actuals PALs provisions of its NA-NSR 

program at R18-2-412 and associated definitions at R18-2-401. 

· 40 CFR 51.165(f)(1)(iii)(B) – ADEQ’s provision for PALs does not specify that modifications 

under a PAL do not need approval through the nonattainment major NSR program. Only the 

PSD program is mentioned. Note that ADEQ’s submittal does not contain a definition for 

nonattainment major NSR permit (see 40 CFR 51.165(a)(1)(xxx). ADEQ should either add this 

definition or considering referencing R18-2-403. 
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· 40 CFR 51.165(f)(2)(iv) – Neither the ADEQ regulatory provisions for PALs at R18-2-412 nor the 

ADEQ regulatory definitions in R18-2-401 that apply in the context of major sources and major 

modifications contain a definition for major emissions unit as is required by 40 CFR 

51.165(f)(2)(iv). (This term is also not included in the definitions at R18-2-101 or R18-2-301 that 

ADEQ submitted for approval as part of this action.) 

· 40 CFR 51.165(f)(3)(ii) – ADEQ’s PAL provision for calculating baseline emissions at R18-2-

412(B)(2) does not specify that baseline actual emissions are to include emissions associated 

not only with operation of the unit, but also emissions associated with startup, shutdown and 

malfunction, as is required by 40 CFR 51.165(f)(3)(ii). 

· 40 CFR 51.165(f)(9) – ADEQ’s PAL provisions at R18-2-412(H) contain an incorrect reference to 

(H)(4) instead of the definition for major modification, and R18-2-412(H)(5) uses “eliminated” 

where the federal regulation uses “established.” 

· 40 CFR 51.165(f)(10) – ADEQ’s program contains incorrect cross-references in meeting this 

requirement, as follows: ADEQ’s PAL renewal provisions at R18-2-412(I)(1) must contain a 

reference to subsection (D) of R18-2-412 instead of (F), and R18-2-(I)(4)(a) must reference 

subsection (E) of R18-2-412. 

Section 173(a)(4) of the Act 

Section 173(a)(4) of the Act requires that NA-NSR permit programs shall provide that permits to 

construct and operate may be issued if “the Administrator has not determined that the applicable 

implementation plan is not being adequately implemented for the nonattainment area in which the 

proposed source is to be constructed or modified.” However, ADEQ’s program does not contain a 

provision that would prohibit the issuance of NA-NSR permits in areas where the Administrator has 

made this determination or that requires that ADEQ conduct a review to ensure that this requirement 

is met. To obtain full program approval, ADEQ must add a provision to its NA-NSR program 

requirements that ensures compliance with CAA section 173(a)(4). 

5.7.3 Part D, Subpart 4 of the Act – Additional Provisions for Particulate

Matter Nonattainment Areas 

 

ADEQ’s NSR submittal does not fully address all of the elements necessary to satisfy the CAA’s Title I, 

Part D, Subpart 4 requirements regarding PM2.5 and PM10 precursors under CAA section 189(e) for 

purposes of the NA-NSR program, as explained in detail below. However, ADEQ’s NA-NSR SIP submittal 

represents a considerable strengthening of the currently approved Arizona SIP, which does not address 

NSR permitting for PM2.5 or PM10 at all, as a result of the length of time that has elapsed since EPA last 

approved substantial revisions to ADEQ’s NSR program. For the reasons explained below, EPA does not 

yet have the information needed to evaluate the elements necessary to satisfy the CAA’s Title I Part D, 

Subpart 4 requirements regarding PM2.5 and PM10 precursors for purposes of ADEQ’s NA-NSR program 

in certain nonattainment areas under ADEQ’s jurisdiction. Therefore, EPA is proposing to grant limited 

approval to the NA-NSR provisions in ADEQ’s NSR submittal with respect to PM2.5 and PM10 for those 

areas, and will consider at a later date whether a limited disapproval is required, as explained below. 
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5.7.3.1 PM2.5 Precursors under Subpart 4 

On January 4, 2013, the U.S. Court of Appeals for the District of Columbia Circuit, in Natural Resources 

Defense Council v. EPA33, issued a decision that remanded the EPA’s 2007 and 2008 rules implementing 

the 1997 PM2.5 NAAQS. EPA’s 2008 implementation rule addressed by the court decision, 

“Implementation of New Source Review (NSR) Program for Particulate Matter Less Than 2.5 

Micrometers (PM2.5)” (the 2008 NSR PM2.5 Rule)34, promulgated NSR requirements for 

implementation of PM2.5 in both nonattainment areas (under the NA-NSR program) and 

attainment/unclassifiable areas (under the PSD program). The Court of Appeals found that EPA erred in 

implementing the PM2.5 NAAQS in these rules for nonattainment areas solely pursuant to the general 

implementation provisions of subpart 1 of part D of title I of the CAA, rather than pursuant to the 

additional implementation provisions specific to particulate matter nonattainment areas in subpart 4. 

The Court of Appeals ordered the EPA to “repromulgate these rules pursuant to Subpart 4 consistent 

with this opinion.” 706 F.3d at 437. Although the Court of Appeals declined to establish a deadline for 

EPA’s response to the remand, EPA intends to promulgate new generally applicable implementation 

regulations for the PM2.5 NAAQS in accordance with the requirements of subpart 4. In the interim, 

however, states and EPA still need to proceed with implementation of the PM2.5 NAAQS in a timely and 

effective fashion in order to meet statutory obligations under the CAA and to assure the protection of 

public health intended by those NAAQS. 

ADEQ’s NSR SIP submittal generally includes requirements for the PM2.5 NA-NSR program consistent 

with the provisions promulgated in the 2008 NSR PM2.5 Rule. Specifically, ADEQ’s NSR SIP submittal 

includes the PM2.5 significant emission rates at R18-2-101(130), regulation of certain PM2.5 precursors 

(SO2 and NOX) at R18-2-101(130), the regulation of PM10 and PM2.5 condensable emissions at R18-2-

101(122)(f), and the emissions offset requirements at R18-2-403(A)(3). Separate and aside from the 

issues identified in Sections 5.7.1 and 5.7.2 above that have resulted in our proposing limited approval 

and limited disapproval of ADEQ’s NA-NSR submittal, EPA has determined that it is not prepared at this 

time to grant full approval to ADEQ’s NSR SIP submittal as to the PM2.5 NA-NSR program requirements, 

in light of the Court’s remand of the 2008 NSR PM2.5 Rule, and for the reasons explained below. 

EPA is in the process of evaluating the requirements of subpart 4 as they pertain to NA-NSR. In 

particular, subpart 4 includes section 189(e) of the CAA, which requires the control of major stationary 

sources of PM10 precursors (and hence under the court decision, PM2.5 precursors) “except where the 

Administrator determines that such sources do not contribute significantly to PM-10 levels which 

exceed the standard in the area.” Although ADEQ’s NSR SIP submittal does include regulation of SO2

and NOx as PM2.5 precursors, it does not include the regulation of VOCs or ammonia. Nor does the NSR 

SIP submittal include a demonstration as to whether or not the regulation of VOCs or ammonia is 

necessary under section 189(e). The evaluation of which precursors need to be controlled to achieve 

the standard in a particular area is typically conducted in the context of the state’s preparing and the 

EPA’s reviewing of an area’s attainment plan SIP. In this case, there are two designated PM2.5

 

33 706 F.3d 428 (D.C. Cir. 2013). 

34 73 Fed. Reg. 28321 (May 16, 2008).
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nonattainment areas in Arizona, the Nogales (portion of Santa Cruz County, AZ) and West Central Pinal 

(portion of Pinal County, AZ) areas. Both are designated nonattainment for the 2006 annual PM2.5

NAAQS. However, on January 7, 2013 and September 4, 2013, EPA finalized determinations of 

attainment for these areas, respectively (78 Fed. Reg. 887 and 78 Fed. Reg. 54394), which suspended 

the requirement for the state to submit, among other things, an attainment plan SIP for the area.35

Accordingly, PM2.5 attainment plans for SIP approval are not currently before Region 9 for these areas. 

As Region 9 does not have before it the state’s analysis as to which precursors need to be controlled in 

these areas pursuant to section 189(e) of the Act, as would be generally contained in an attainment 

plan SIP, it cannot fully approve as complying with the CAA a nonattainment NSR SIP that only 

addresses a subset of the scientific PM2.5 precursors recognized by EPA. 

On the other hand, while ADEQ’s submittal may not yet contain all of the elements necessary to satisfy 

the CAA requirements when evaluated under subpart 4, the NA-NSR SIP submittal represents a 

considerable strengthening of the currently approved Arizona SIP, which does not address NSR 

permitting for PM2.5 at all. Therefore, EPA is proposing to grant limited approval to the PM2.5 NA-NSR 

provisions in ADEQ’s NSR submittal for the Nogales and West Central Pinal PM2.5 nonattainment areas. 

For the reasons explained above, EPA is not evaluating at this time whether ADEQ’s NA-NSR submittal 

will require additional revisions relating to PM2.5 to satisfy the subpart 4 requirements. Once EPA repromulgates the Federal PM2.5 regulations with respect to NA-NSR permitting in response to the 

Court’s remand, EPA will consider whether a limited disapproval should also be proposed for ADEQ’s 

PM2.5 NA-NSR program based on this issue. 

5.7.3.2 PM10 Precursors under Subpart 4 

As discussed above, section 189(e) of the CAA requires that ADEQ’s NSR program for PM10

nonattainment areas apply to major stationary sources of PM10 precursors, except where the 

Administrator determines that such sources do not contribute significantly to PM10 levels which exceed 

the standard in the area. There are currently eight PM10 nonattainment areas under ADEQ’s permitting 

jurisdiction: Ajo, Hayden, Nogales, Paul Spur/Douglas, the Pinal County portion of the Maricopa County 

nonattainment area, West Pinal, Rillito, and Yuma. Except for the Maricopa nonattainment area and 

the West Pinal nonattainment area, these areas have been nonattainment since 1990 and EPA has 

never determined that regulation of PM10 precursors is required under section 189(e) and EPA has 

made a determination of attainment in those areas without such a requirement. As such, we further 

consider the PM10 precursor requirements for the Pinal County portion of the Maricopa PM10 

nonattainment area and the West Pinal PM10 nonattainment area: 

· With respect to the Pinal County portion of the Maricopa PM10 nonattainment area, on June 10, 

2014, EPA finalized its approval of the attainment plan under section 189(d) for the Maricopa 

PM10 nonattainment area, including the Pinal County portion of this area, and identified that 

 

35 Prior to the Court’s decision, EPA would not have reviewed PM2.5 attainment plan submittals for compliance with Section 

189. 
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EPA has previously determined that PM10 precursors from major sources do not contribute 

significantly to PM10 levels. See 79 Fed. Reg. 7118, 7120, footnote 6 (Feb. 6, 2014). 

· With respect to the West Pinal PM10 nonattainment area, we note that on September 4, 2013, 

the West Pinal area was redesignated to nonattainment for the 1987 PM10 standard. ADEQ’s 

NSR SIP submittal generally includes NA-NSR requirements for PM10 nonattainment areas such 

as the PM10 significant emission rate at R18-2-101(130), the regulation of PM10 and PM2.5

condensable emissions at R18-2-101(122)(f), and the emissions offset requirements at R18-2-

403(A)(3). However, separate and aside from the issues identified in Sections 5.7.1 and 5.7.2 

above that have resulted in our proposing limited approval and limited disapproval of ADEQ’s 

NA-NSR submittal, EPA has determined that it is not prepared at this time to grant full approval 

to ADEQ’s NSR SIP submittal as to the PM10 nonattainment NSR program requirements for the 

West Pinal nonattainment area. The evaluation of which precursors need to be controlled to 

achieve the standard in a particular area is typically conducted in the context of the state’s 

preparing and the EPA’s reviewing of an area’s attainment plan SIP. On February 19, 2014, 

ADEQ withdrew from EPA’s consideration the Arizona State Implementation Plan Revision for 

the West Pinal County PM10 Nonattainment Area (submitted on December 30, 2013). 

Accordingly, a PM10 attainment plan for West Pinal is not currently before Region 9. As such, 

Region 9 does not have before it the state’s analysis as to which precursors need to be 

controlled in this area pursuant to section 189(e) of the Act, as would be generally contained in 

an attainment plan SIP, and cannot fully approve as complying with the CAA a nonattainment 

NSR SIP that does not address scientific PM10 precursors recognized by EPA. 

While ADEQ’s submittal may not yet contain all of the elements necessary to satisfy the CAA NA-NSR 

requirements when evaluated under subpart 4, the proposed revisions to ADEQ’s NA-NSR program 

represent a considerable strengthening of the currently approved Arizona SIP, which does not address 

NSR requirements for PM10 at all. Therefore, EPA is proposing to grant limited approval to the PM10

NA-NSR provisions in ADEQ’s NSR submittal as they apply to the West Pinal nonattainment area. Once 

ADEQ submits a new PM10 attainment plan for this area, EPA will consider whether a limited 

disapproval should also be proposed based on this issue.

Section 5.7.4 Additional Discussion of NA-NSR Program Requirements

Condensable PM 

On December 24, 2012, regulatory revisions related to condensable PM became effective in EPA’s NANSR regulations at 40 CFR 51.165 (see 77 Fed. Reg. 65107 (Oct. 25, 2012)). These revisions corrected an 

error where EPA inadvertently identified particulate matter (PM) as a criteria pollutant (that is, a 

pollutant subject to a NAAQS) when identifying how to treat condensable PM emissions. ADEQ’s 

submittal contains the erroneous language that was originally included in 40 CFR 51.165. We do not 

consider this to be a disapproval issue. However, EPA believes that since the revisions were made to 

correct an inadvertent technical error, ADEQ has the discretion to determine that PM is clearly not a 

criteria pollutant and to therefore implement the rule by not considering PM to include condensable 

PM. Nevertheless, for clarity, we recommend that ADEQ correct this error in its regulations when 
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addressing other necessary revisions to its NSR program that are identified as part of this SIP action. 

Section 5.7.5 Recommendations

In addition to the disapproval issues identified in Sections 5.7.2 and 5.7.3, our Evaluation identifies 

numerous recommendations for correcting typographical errors and making other small revisions to 

ADEQ’s rules to provide additional clarity and consistency with the federal requirements. All of our 

recommendations are included in our Evaluation, but we specifically note: 

1. ADEQ should consider revising R18-2-401(11)(e) to change the reference to “this section” to 

“this Article.” 

2. ADEQ should consider revising R18-2-101(13)(a) to use “and” instead of “or” for consistency 

with the federal regulation at 40 CFR 51.165(a)(1)(xi). 

3. ADEQ may want to consider revising R18-2-402(F)(4) to reference (F)(1) instead of (F)(1)(a). 

See 40 CFR 51.165(a)(6)(v). 

4. ADEQ should consider revising R18-2-412(H) to consistently use the term “PAL allowable 

emissions” as defined in R18-2-401(14). 

5. ADEQ should consider revising R18-2-401(18) to reference “Article 3 or 4.” See 40 CFR 

51.165(f)(2)(ix). 

6. When correcting the disapproval issue related to ADEQ’s use of “proposed final permit,” 

ADEQ should consider revising R18-2-404(F) to identify whether “by the time a permit 

issued” refers to the final permit or proposed final permit. 

 

5.8 40 CFR 51.166 – Prevention of Significant Deterioration 

40 CFR 51.166 identifies the necessary requirements for a SIP-approved PSD program under sections 

160-169 of the Clean Air Act. Generally, each source or modification that is subject to the program 

must obtain a PSD permit prior to construction. The permit must include applicable Best Available 

Control Technology (BACT) requirements and ensure that the project will not cause or contribute to a 

violation of a NAAQS or increment. Sources subject to PSD review must also comply with a number of 

additional PSD requirements that are detailed in the regulations. 

We have conducted a detailed review of ADEQ’s NSR SIP submittal as compared with the federal PSD 

requirements for SIP-approved PSD programs in 40 CFR 51.166. ADEQ’s NSR SIP submittal generally 

incorporates the federal PSD program requirements through the date on which ADEQ’s most recent 

rule revisions to the NSR program were proposed, that is, July 6, 2012. However, as discussed below, 

there have been a few changes to the federal PSD program requirements since this date as a result of 

court decisions and/or regulatory actions by EPA. 

Our Evaluation identifies how ADEQ’s submittal addresses each of the current specific requirements in 

40 CFR 51.166. Except as discussed below in Sections 5.8.1 and 5.8.2, we find that ADEQ’s submittal 

meets these PSD program requirements, through requirements established in the following ADEQ rules 

reviewed for the NSR SIP submittal: R18-2-101(2), (32), (87), (109), and (122); R18-2-217; R18-2-218; 
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R18-2-301; R18-2-302; R18-2-304; R18-2-330; R18-2-401; R18-2-402; R18-2-406; R18-2-407; R18-2-409; 

and R18-2-412. In additional our review also relied on existing SIP approved provisions in R18-2-101, 

R9-3-101(20), R9-3-301(I) and (K) and R9-3-304(H). While some of the definitions required by the PSD 

program are already approved into ADEQ’s SIP at R18-2-101, which applies broadly to ADEQ’s air 

program, we reconsidered those definitions within in the context of the PSD program. 

Although ADEQ’s submittal meets most PSD program requirements, we are proposing to disapprove 

two specific aspects of ADEQ’s PSD program. The ADEQ rule provisions that we are proposing to 

disapprove are directly comparable to federal PSD rule provisions that have been vacated by federal 

courts, and we find that they are separable from the remainder of ADEQ’s PSD program. Accordingly, 

we find these provisions suitable for disapproval at this time. These provisions are described below in 

Section 5.8.1. 

For the remainder of ADEQ’s PSD program submittal, we are proposing limited approval and limited 

disapproval. We find that approval of ADEQ’s updated PSD program, aside from the two aspects that 

are separable and will be disapproved as mentioned above, will substantially strengthen the SIP 

overall, particularly as the current SIP-approved PSD program is significantly out of date when 

compared with current federal PSD regulatory requirements as well as current State regulations. See 

our discussion in Section 8. However, specific provisions of the PSD SIP program submittal are 

inconsistent with PSD program requirements, and these deficiencies must be addressed before we can 

fully approve ADEQ’s PSD program. The deficiencies that we have identified with ADEQ’s PSD program 

that provide the basis for our limited disapproval are described below in Section 5.8.2. 

As discussed above, we have determined that all other aspects of ADEQ’s submitted PSD program 

meet the requirements of 40 CFR 51.166. Several other issues warranting additional discussion are 

described below in Section 5.8.3; however, these are not disapproval issues. 

5.8.1 PSD Provisions for Which EPA is Proposing Partial Disapproval 

5.8.1.1 PM2.5 Significant Monitoring Concentration 

On January 22, 2013, the U.S. D.C. Circuit Court of Appeals in Sierra Club v. EPA, 705 F.3d 458,vacated 

the parts of two federal PSD rules (40 CFR 51.166(i)(5)(i)(c) and 40 CFR 52.21(i)(5)(i)(c)) establishing a 

PM2.5 significant monitoring concentration (SMC), finding that EPA was precluded from using the PM2.5

SMC to exempt permit applicants from the statutory requirement to compile and submit 

preconstruction monitoring data as part of a complete PSD application. On December 9, 2013, 

revisions to 40 CFR 51.166 and 52.21 were published in the Federal Register to remove these vacated 
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rule elements, effective as of that date. See 78 Fed. Reg. 73698.36 

ADEQ’s submittal at R18-2-407(H)(1)(c) contains the equivalent of the PM2.5 SMC that was vacated by 

the Court of Appeals and which has been removed from the federal PSD regulations. As the Court of 

Appeals found application of this SMC impermissible, and because ADEQ’s regulation incorporating this 

SMC is a separable portion of ADEQ’s PSD program, we are proposing a partial disapproval of ADEQ’s 

submitted PSD program, to disapprove R18-2-407(H)(1)(c).

5.8.1.2 Definition for Basic Design Parameter 

ADEQ’s submittal contains a definition for basic design parameter at R18-2-401(3) that reflects the 

definition that EPA originally developed as part of its Equipment Replacement Provisions. See 68 Fed. 

Reg. 61248 (Oct. 27, 2003). However, the definition for basic design parameter, and other elements 

related to the Equipment Replacement Provisions, were vacated by the D.C. Circuit Court of Appeals in 

State of New York v. EPA, 443 F.3d 880 (D.C. Cir. 2006). While the federal PSD regulations still contain a 

reference to “basic design parameter,” this term is no longer specifically defined under the federal PSD 

regulations, and application of the definition contained in the Equipment Replacement Provisions that 

were vacated by the Court of Appeals is inconsistent with federal PSD requirements. As the Court of 

Appeals found this Equipment Replacement Provisions and, therefore, this definition, impermissible, 

and because ADEQ’s regulation incorporating this definition is a separable portion of ADEQ’s PSD 

program, we are proposing a partial disapproval of ADEQ’s submitted PSD program, to disapprove R18-

2-401(3). 

 

36 We note that in the same decision, the Court of Appeals granted a request from EPA to vacate and remand to EPA the 

portions of two related PSD rules (40 CFR 51.166(k)(2) and 40 CFR 52.21(k)(2)) addressing the significant impact levels (SILs) 

for PM2.5 so that EPA could correct an error in these provisions. In the preamble to the 2010 final rule adding the (k)(2) 

provision, EPA advised that, “notwithstanding the existence of a SIL, permitting authorities should determine when it may 

be appropriate to conclude that even a de minimis impact will ‘cause or contribute’ to an air quality problem and to seek 

remedial action from the proposed new source or modification.” Prevention of Significant Deterioration (PSD) for 

Particulate Matter Less than 2.5 Micrometers (PM2.5) – Increments, Significant Impact levels (SILs) and Significant 

Monitoring Concentration (SMC), 75 Fed. Reg. 64864, 64892 (Oct. 20, 2010). In another passage of the preamble, EPA also 

observed that “the use of a SIL may not be appropriate when a substantial portion of any NAAQS or increment is known to 

be consumed.” Id. at 64894. The Court of Appeals’ decision in Sierra Club v. EPA held that, contrary to these statements in 

the preamble, the text of the (k)(2) provision “did not give permitting authorities sufficient discretion to require a 

cumulative air quality analysis” under such circumstances. 705 F.3d at 464. EPA subsequently removed the SILs language at 

issue from its regulations in the same regulatory action in which it removed the regulatory provisions establishing the SMC 

for PM2.5. 78 Fed. Reg. 73698 (Dec. 9, 2013). However, ADEQ did not adopt the PM2.5 SILs in the same manner as the 

language that was found at 40 CFR 51.166(k)(2) prior to the Court of Appeals’ vacatur. Instead, ADEQ added the PM2.5 SILs 

to its regulations addressing the major NA-NSR program requirement for ensuring that major sources in attainment or 

unclassifiable areas do not cause or contribute to a violation of a NAAQS in adjacent areas, at R18-2-406(A)(5)(b). As such, 

ADEQ’s PSD program does not contain the erroneous PM2.5 SILs regulatory language that the Court of Appeals vacated and 

remanded to EPA, and EPA’s regulatory action that removed the vacated language for the PM2.5 SILs from its PSD 

regulations does not affect the approvability of ADEQ’s PSD program. 
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5.8.2 PSD Program Elements Subject to Limited Approval and

Limited Disapproval

As discussed above, we are proposing a limited approval and limited disapproval of ADEQ’s PSD 

program, aside from the specific ADEQ rule provisions that we are proposing to disapprove as 

described in Section 5.8.1. We are proposing this approach because while ADEQ’s PSD program 

generally satisfies federal PSD requirements, and approving the updated ADEQ regulations into the 

Arizona SIP will substantially strengthen the Arizona SIP overall by generally bringing the regulatory 

requirements in the SIP up to date, we have identified a number of deficiencies that will not allow us to 

fully approve the program as currently submitted.37 Our limited disapproval of ADEQ’s PSD program is 

based on the issues described below. 

References to Articles 9 and 11 in ADEQ’s submittal 

ADEQ’s submittal often refers to Articles 9 and/or 11 of ADEQ’s regulations where the federal 

regulations refer to 40 CFR parts 60, 61, or 63; or, similarly, sections 111 or 112 of the Act. See R18-2-

101(53)(a), (122)(b); R18-2-401(10); R18-2-402(G)(2); and R18-2-406(A)(4). Articles 9 and 11 are where 

ADEQ incorporates by reference the federal regulations in 40 CFR part 60, 61, and 63 (which EPA 

implements under sections 111 and 112 of the Act). However, these Articles are not in the SIP, have 

not been submitted for SIP approval, and do not contain provisions equivalent to all of the subparts in 

parts 60, 61, and 63. In order to obtain full program approval, ADEQ must ensure its SIP-approved 

program adequately encompasses the requirements in 40 CFR parts 60, 61, or 63, sections 111 and 112 

of the Act, where these provisions are referenced by the required PSD provisions in 40 CFR 

51.166(b)(1)(iii)(aa), (b)(12), (b)(16)(i), (b)(17), (b)(47)(ii)(c), (b)(49)(ii), (i)(1)(ii)(aa), and (j). 

References to Increment 

ADEQ’s submittal uses the term “increment” or “incremental ambient standard,” but does not 

specifically define these terms or otherwise identify what is meant by these terms. While the PSD 

program does not specifically define the term “increment” either, the term is introduced at 40 CFR 

51.166(c) – Ambient air increments and other measures. (emphasis added) 40 CFR 51.166(c) then goes 

on to identify the specific increment values as “maximum allowable increases.” ADEQ appears to have 

taken the approach to use the term “maximum allowable increase” to refer to the increments, which is 

acceptable. ADEQ adopted the increments, or maximum allowable increases, in R18-2-218 – Limitation 

of Pollutants in Classified Attainment Areas. However, in other rules ADEQ uses “increment” or 

“incremental ambient standard” where it appears the intent is to refer to the standards established in 

R18-2-218 and identified in ADEQ’s rules as the “maximum allowable increases.” See R18-2-406(E), 

R18-2-412(G)(b), R18-2-101(51), R18-2-319, R18-2-320. To obtain full program approval, ADEQ must 

ensure it rules identify the maximum allowable increases as the increments, or consistently use one 

term for referring to these values. 

 

37 We note that, as described above in Sections 5.2 – 5.6 of this document, certain aspects of ADEQ’s PSD program also do 

not fully satisfy the required program elements for the so-called federal “minor NSR” program as it applies to sources 

subject to the PSD program. We will not repeat those issues here, but note that certain of ADEQ’s PSD program elements 

must be revised to satisfy federal minor NSR program requirements as well as PSD requirements. 
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Revised PM2.5 NAAQS 

On January 15, 2013, EPA issued a final rule revising the NAAQS for PM2.5 for the annual averaging 

period, lowering the level of the NAAQS from 15.0 to 12.0 mg/m3, effective March 18, 2013 (see 78 

Fed. Reg. 3086). This new NAAQS is required to be implemented for PSD sources (unless otherwise 

grandfathered under provisions at 40 CFR 51.166(i)(10)) beginning with the effective date of the 

NAAQS. However, ADEQ’s PSD program does not provide for the review of new or modified sources for 

compliance with this new NAAQS as required in 40 CFR 51.166(b)(2)(iii)(i)(2), (b)(35), (d), (g)(3)(iii), (k), 

and (m)(1). Instead, ADEQ’s PSD program currently references state ambient air quality standards, 

which are set at levels that are equivalent to all of the current NAAQS, except for this newly adopted 

PM2.5 NAAQS. See R18-2-218(F)(b)(ii), R18-2-401(25), R18-2-406(A) and R18-2-407(B). Because of the 

approach used in ADEQ’s NSR program, i.e., its reference to state air quality standards instead of the 

NAAQS, any changes EPA makes to the NAAQS will not be included in ADEQ’s program until ADEQ 

revises its air quality standards rules to adopt the revised NAAQS as state air quality standards. This 

does not relieve any owner or operator from the requirement to comply with all NAAQS at the time a 

final PSD permit is issued, including the recently revised new PM2.5 NAAQS (unless otherwise 

grandfathered under 40 CFR 51.166). See CAA section 165(a)(3). Therefore, ADEQ must update its 

regulations to include the new PM2.5 NAAQS and submit the updated regulations for SIP approval in 

order to obtain full PSD program approval. 

Reference to R18-2-408 – Innovative Control Technology

R18-2-406(A) contains a reference to R18-2-408, but R18-2-408 is not in the SIP and has not been 

submitted for SIP approval. To obtain full program approval, ADEQ must revise R18-2-406(A) or submit 

R8-2-408 for SIP approval. 

40 CFR 51.166(a)(7)(iii) – Applicability 

ADEQ’s submittal allows a source at R18-2-302(G) and R18-2-402(C) to begin actual construction upon 

the issuance of a proposed final permit. As previously discussed in Section 5.2.1, ADEQ’s program is 

ambiguous as to whether a proposed final permit, as defined in R18-2-101(114), constitutes final 

action by the Director. While ADEQ has issued guidance clarifying that it treats “proposed final 

permits” as final actions for purposes of preconstruction permitting38, in order to obtain full PSD 

program approval, ADEQ’s regulations must make clear that a source may not begin actual 

construction before a final determination on a PSD permit application is made by the Director. 

40 CFR 51.166(b): Definitions

ADEQ’s submittal contains definitions applicable to the PSD program that do not fully meet 40 CFR 

51.166(b)(1), which requires each State plan to contain specific definitions for the PSD program. 

Deviations from the wording are approvable if the State specifically demonstrates that the submitted 

definition is more stringent, or at least as stringent, in all respects as the corresponding definition in 40 

CFR 51.166(b). The definitions for ADEQ’s PSD program are generally found in R18-2-101 and R18-2-

401. We have carefully reviewed the definitions included in the submittal and ADEQ’s SIP as compared 

 

38 See ADEQ memo dated February 10, 2015 related to proposed final permits. ADEQ submitted this letter in its February 

23, 2015 supplement. 
Arizona DEQ NSR Program SIP Submittal 

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with the federal PSD definitions in 40 CFR 51.166(b) and have found that generally, ADEQ’s submittal 

contains the definitions necessary to implement a PSD program. However, a number of ADEQ’s 

definitions do not meet the requirements of 40 CFR 51.166(b)(1) because their wording deviates from 

the wording in the corresponding federal regulatory definitions in 40 CFR 51.166(b)(1) in a manner that 

appears to be inconsistent with the federal definitions, and the State has not demonstrated that they 

are at least as stringent. 

Except for broader deficiencies identified above that also apply to the definitions in the PSD program, 

the definitions that do not meet the requirements of 40 CFR 51.166(b)(1) are listed below. In most 

cases, ADEQ’s definitions meet most aspects of the federal definition but contain minor changes in 

wording or missing pieces of the definition that make ADEQ’s definition in consistent with the federal 

definition in some respects. In order to obtain full program approval, ADEQ must either revise the 

following definitions to conform to the wording in the federal regulation or otherwise demonstrate 

that they are at least as stringent as the Federal regulatory definition in all respects. 

· 40 CFR 51.166(b)(1) Major stationary source – language from subparagraph 40 CFR 

51.166(b)(1)(i)(c) not included in the definition at R18-2-101(75). See also discussion below of 

definition of “stationary source” at 40 CFR 51.166(b)(5). 

· 40 CFR 51.166(b)(3) Net emissions increase – 

o ADEQ’s definition at R18-2-101(87)(c) identifies that an increase or decrease in actual 

emissions is creditable only to the extent that the Director has not relied on it in issuing 

a permit. However, this definition is broader than the definition in the PSD program, 

which only specifies that the reviewing authority has not relied on the increase or 

decrease in issuing a PSD permit. In some respects this makes ADEQ’s definition more 

stringent (decreases), but in other respects less stringent (increases). 

o The equivalent of paragraph 40 CFR 51.166(b)(3)(viii) is not included in ADEQ’s 

definition at R18-2-101(87). 

· 40 CFR 51.166(b)(5) Stationary source – the federal regulation at 40 CFR 51.166(b)(5) defines 

this term as “any building, structure, facility or installation which emits or may emit a regulated 

NSR pollutant,” with “regulated NSR pollutant” also being a federally defined term at 40 CFR 

51.166(b)(49), whereas ADEQ’s regulation at R18-2-101(39) defines “stationary source” as “any 

building, structure, facility or installation subject to regulation pursuant to A.R.S. § 49-426(A) 

which emits or may emit any air pollutant,” with “air pollutant” being an undefined term in 

ADEQ’s regulation. We note that A.R.S. § 49-426(A) provides a cross-reference to certain 

exemptions from permitting identified in A.R.S. § 49-426(B), specifically agricultural equipment 

used in normal farm operations and certain fuel burning equipment, which do not appear to be 

consistent with federal PSD definition. The federal definition for stationary source is very broad 

and does not exclude these source categories. We agree that it is acceptable for ADEQ to limit 

its NSR program to certain kinds of stationary sources, as specified in 40 CFR 51.160(e), but the 

federal definition for a stationary source in the context of the PSD program is not the 

appropriate place for such an exclusion, as it does not allow exclusions for certain source 

categories. See our discussion of 40 CFR 51.160(e) in Section 5.2.2 related to equipment 

exempted from the NSR program. For full approval of ADEQ’s PSD program into the SIP, ADEQ 
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must demonstrate that its definition is at least as stringent as the federal definition in all 

respects as that in 40 CFR 51.166(b)(5). 

· 40 CFR 51.166(b)(14) Major source baseline date – language equivalent to paragraph 40 CFR 

51.166(b)(14)(iv) is not included at ADEQ’s definition in R18-2-218(B)(1). 

· 40 CFR 51.166(b)(15) Baseline area – ADEQ’s definition at R18-2-218(D) contains an incorrect 

reference to R18-2-217 rather than referring to section 107(d)(1)(A)(ii) or (iii) of the Act or the 

equivalent; also, language equivalent to that in paragraph 40 CFR 51.166(b)(15)(iii) is not 

included 

· 40 CFR 51.166(b)(16) Allowable emissions – ADEQ’s definition at R18-2-101(13)(b) does not 

include the “future compliance date” language that is in 40 CFR 51.166(b)(16)(ii) and ADEQ has 

not demonstrated that its regulatory language is at least as stringent as the federal definition; 

· 40 CFR 51.166(b)(17) Federally enforceable – ADEQ’s definition at R18-2-101(53)(d) identifies 

that requirements included in permits pursuant to R18-2-306.01 or R18-2-306.02 are included 

in the definition of federally enforceable requirements, but excludes those requirements that 

are identified as “enforceable only by the state.” With this action, we approving R18-2-306.01 

and R18-2-306.02 into the SIP, making requirements pursuant to these rules federally 

enforceable. As such, ADEQ does not have the discretion to identify some of those 

requirements as only enforceable by the state. 

· 40 CFR 51.166(b)(22) Complete – ADEQ’s definition at R18-2-401(4) is missing the second 

sentence of the federal definition. 

· 40 CFR 51.166(b)(23) Significant – ADEQ definition at R18-2-101(130)(e) uses “milligrams” 

instead of “micrograms” as required in paragraph 40 CFR 51.166(b)(23)(iii). 

· 40 CFR 51.166(b)(40) Projected actual emissions – ADEQ’s definition at R18-2-401(20)(b)(iii) 

does not specifically require inclusion of emissions from malfunctions in the determination of 

projected actual emissions, and exempts emissions from a shutdown associated with a 

malfunction from such determination, while the federal definition at 40 CFR 51.166(b)(40)(ii)(b) 

requires that emissions from both shutdowns and malfunctions be included. 

· 40 CFR 51.166(b)(48) Subject to regulation – this definition is not included in ADEQ’s NSR SIP 

submittal; see discussion below in Section 5.8.3 regarding requirements related to greenhouse 

gases. ADEQ did not adopt a definition for the term “subject to regulation” or include such 

definition as part of the NSR SIP submittal, presumably because the federal definition of the 

term contains the requirements of the GHG Tailoring Rule, and GHGs cannot be regulated 

under State law. We note, however, that while the GHG program requirements are contained 

as part of the definition of the term “subject to regulation,” the federal definition of this term 

also contains non-GHG-specific program elements for determining when a pollutant is “subject 

to regulation.” As such, ADEQ must still add a definition to its PSD regulations to address these 

elements of the term “subject to regulation” in order to obtain full program approval. 

· 40 CFR 51.166(b)(49) Regulated NSR pollutant – ADEQ’s regulatory definition at R18-2-101(122) 

does not include the final two sentences of 40 CFR 51.166(b)(49)(i)(a)or the language at 40 CFR 

51.166(b)(49)(iv); ADEQ’s definition also includes an incorrect cross-reference to hazardous air 

pollutants listed under R18-2-1101 that is not consistent with the requirements in 40 CFR 
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51.166(b)(49)(v); and ADEQ’s regulatory definition needs to update the July 1, 2010 date in the 

cross-reference to section 108 of the Clean Air Act. 

40 CFR 51.166(e): Restrictions on area classifications 

To obtain full PSD program approval, ADEQ must address the following deficiencies in its PSD program.

· 40 CFR 51.166(e)(1) – ADEQ’s submittal contains requirements for area classifications in R18-2-

217. However, ADEQ’s submittal does not completely meet the requirements of 40 CFR 

51.166(e) and section 162(a) of the Act, which requires certain areas in existence on August 7, 

1977 to be designated as Class I areas. Such designations apply to any boundary changes made 

to those Class I areas after August 7, 1977. While ADEQ generally includes this requirement at 

R18-2-217(B), its rule limits such boundary changes to those made prior to March 12, 1993. In 

order to obtain full program approval, ADEQ must remove the date or update the date used for 

incorporating boundary changes made to Class I areas to the present. 

· 40 CFR 51.166(e)(2) – ADEQ’s NSR submittal at R18-2-217 does not contain a provision 

consistent with this federal regulatory requirement for Class I area redesignations prior to 

August 7, 1977 in rule R18-2-217 or elsewhere. Even if it is the case that there are no areas in 

Arizona that were redesignated Class I prior to August 7, 1977, ADEQ’s program must recognize 

Class I area designations under this provision that may have been made in other states for 

which sources within ADEQ may have an impact. 

· 40 CFR 51.166(e)(3) – ADEQ’s NSR submittal does not include a provision that is fully consistent 

with this requirement. While ADEQ’s rules generally meet this requirement at R18-2-217(D), 

this rule does not fully meet this requirement because (1) it is not clear what is meant in 

ADEQ’s rule by “all other areas” and (2) it does not contain a provision that ensures that ADEQ 

recognizes federal legislation that specified the area classification of a particular area. 

40 CFR 51.166(f) – Exclusions from increment consumption 

To obtain full PSD program approval, ADEQ must address the following deficiencies in its PSD program.

· 40 CFR 51.166(f)(1)(v) and (f)(4) – ADEQ’s NSR submittal contains provisions that allow for 

exclusions from increment consumption, for certain temporary emissions, that do not conform 

with the requirements in the analogous federal rule. First, ADEQ’s, rule at R18-2-218(F)(5) 

requires only the ADEQ Director’s approval for temporary emissions beyond two years, but the 

federal program requirements at 40 CFR 51.166(f)(i)(v) and 51.166(f)(4) require the 

Administrator’s approval to allow temporary emissions that exceed two years. In addition, 

ADEQ’s program language does not reference a specific time period beyond two years that it 

would allow for exclusions from increment consumption, which is not consistent with the 

federal regulation’s requirement at 40 CFR 51.166(f)(4) that the time for such exclusions be 

specified in the plan. Finally, the provision at R18-2-218(F)(5)(b)(ii), which references the state 

ambient air quality standards, must be applied to “any” air quality control region. As currently 

written this provision does not clearly apply to areas outside of Arizona where Arizona’s 

standards would not generally apply. To obtain full program approval ADEQ must remove the 

Director’s discretion to extend the time period for temporary emissions, and broaden the 

reference to the state ambient air quality standards to apply to any air quality control region. 
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40 CFR 51.166(g) – Redesignation 

To obtain full PSD program approval, ADEQ must address the following deficiencies in its PSD program.

· 40 CFR 51.166(g)(1) – ADEQ’s submittal contains provisions at R18-2-217(A) identifying that 

attainment and unclassifiable areas in the State shall be designated as Class I, II, or III. However, 

this portion of the PSD program applies to all areas of the State. That is, all areas of the State 

must be designated as Class I, II, or III irrespective of their attainment designation under Section 

107 of the Act. 

· 40 CFR 51.166(g)(2)(i) – ADEQ’s submittal contains provisions at R18-2-217(E) for allowing the 

state to redesignate certain areas, but the submittal does not adequately meet the public 

participation requirements specified in the federal regulation, which requires a public hearing 

consistent with the procedures in 40 CFR 51.102. ADEQ’s redesignation provisions do not 

specify the public hearing procedures that will be used. 

· 40 CFR 51.166(g)(3) – ADEQ’s provisions for classifying areas to Class III do not clearly identify 

which areas may be designated as Class III as specified in 40 CFR 51.166(g)(3). Also, 

o 40 CFR 51.166(g)(3)(ii) – R18-2-217(E) allows for the redesignation to be approved by 

the Governor or the Governor’s designee. However, the federal program specifically 

requires the Governor’s approval and does not allow for this approval to be delegated. 

To obtain full approval ADEQ’s program must require approval of redesignations by the 

Governor.

o 40 CFR 51.166(g)(3)(iii) – R18-2-217(F)(4) contains a reference to “maximum allowable 

concentration” which appears to refer to R18-2-218(E). However, R18-2-218(E) 

references the “ambient air quality standards in this Article.” The state’s ambient air 

quality standards do not generally apply in areas outside of Arizona, and ADEQ’s NSR 

submittal does not demonstrate that they would apply outside of Arizona for purposes 

of R18-2-217(F)(4). To obtain full program approval, ADEQ’s regulations must ensure 

that redesignation to a Class III area would not cause or contribute to a NAAQS violation 

in areas outside of Arizona. 

· 40 CFR 51.166(g)(3)(iv) – ADEQ’s provisions do not clearly require that a permit application that 

can only be approved if an area is redesignated to Class III, and material submitted as part of 

that application, must be available for public inspection prior to the public hearing on the 

redesignation to Class III.

40 CFR 51.166(i): Exemptions 

The provisions in this section of the federal regulation allow for certain sources or modifications to be 

exempt from portions of the PSD program’s requirements. These exemptions are an optional portion 

of the PSD program that states may adopt provided their requirements are consistent with the 

requirements specified in 40 CFR 51.166(i) for the exemptions. We reviewed the exemptions contained 

in ADEQ’s rules to ensure they were consistent with the requirements in the federal program. ADEQ’s 

PSD SIP submittal contains certain exemption provisions that general correspond to those in 40 CFR 

51.166(i) but which are less stringent than the federal requirements for those exemptions in certain 

regards, as follows: 

· 40 CFR 51.166(i)(1)(iii) – ADEQ’s submittal contains a provision at R18-2-406(E) providing an 

exemption for certain portable stationary sources with a prior permit that contains 
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requirements equivalent to the PSD requirements in 40 CFR 51.166 (j) through (r), as allowed by 

40 CFR 51.166(i)(1)(iii). However, ADEQ’s rule at R18-2-406(E) is worded broadly to also allow 

an exemption for portable sources that have been permitted under Article 4 of ADEQ’s 

regulations, which also includes nonattainment NSR permits and PAL permits. We do not 

interpret this federal exemption as generally applying to NSR permits, as it is not clear that such 

permits contain requirements “equivalent” to those in 40 CFR 51.166(j) through (r). To obtain 

full PSD program approval ADEQ must limit this exemption to those sources with permits that 

contain requirements equivalent to 40 CFR 51.166(j) through (r). 

40 CFR 51.166(k): Source impact analysis 

This portion of the PSD program regulations requires that each source or modification demonstration 

that allowable increases will not cause or contribute to a violation of any NAAQS, in any air quality 

control region, or any maximum allowable increase over the baseline concentration in any area. 

· 40 CFR 51.166(k)(1) – ADEQ’s submittal contains conditions generally meeting these 

requirements in rule R18-2-406(A)(5)(a). There are two deficiencies with this provision, 

however. These deficiencies must be addressed in order for EPA to grant full approval for 

ADEQ’s PSD program.

o R18-2-406(A)(5) contains an “or” between subsections (a) and (b) that could be 

interpreted as allowing a source to demonstrate it will not contribute to an increase 

above the significance levels in an adjacent nonattainment area in lieu of the 

demonstration required by R18-2-406(A)(5)(a). The provisions of subsection (b) relate to 

requirements under a different portion of the NSR program – specifically under 40 CFR 

51.165. As such, it is likely ADEQ would interpret subsections (a) and (b) as separate 

requirements with which a source must demonstrate compliance. Nevertheless, the 

potential for misinterpretation of this substantive requirement of the PSD program 

provides a basis for our limited disapproval of the PSD program submittal. In order to 

obtain full PSD program approval, ADEQ must change the “or” between subsections (a) 

and (b) to an “and”, or otherwise revise its regulation in a manner that ensures that 

ADEQ’s program clearly requires each source or modification subject to the PSD 

program to demonstrate compliance with requirements equivalent to those in 40 CFR 

51.166(k). 

o R18-2-406(A)(5)(a) requires that a person applying for a PSD permit demonstrate that 

the project would not cause a violation of any maximum allowable increase over the 

baseline concentration in “any attainment or unclassifiable area.” However, ADEQ’s 

definition for “attainment area” in the SIP at R18-2-101(19) limits attainment areas to 

those “in the state.” In addition, as discussed previously, it is not clear that ADEQ’s 

references to the state’s ambient air standards would apply in areas outside of Arizona. 

To obtain full program approval, ADEQ must ensure its program applies to areas inside 

and outside of Arizona. 

40 CFR 51.166(l): Air quality models 

This portion of the program specifies the types of air quality modeling required in applications for 

permits under the PSD program. 
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· 40 CFR 51.166(l)(2) – ADEQ’s submittal includes R18-2-406(A)(6)(b), which specifies that the use 

of a modified or substituted model must be subject to public notice and the opportunity for 

public comment, but neither the rule nor the submittal makes clear the procedures that would 

be used for notice and comment for this purpose or demonstrates that such procedures would 

be consistent with 40 CFR 51.102, as required by 40 CFR 51.166(l)(2). To obtain full PSD 

program approval, ADEQ’s rules must ensure that the notice and comment procedures that are 

used for this purpose meet the requirements of 40 CFR 51.102. 

40 CFR 51.166(n): Source information

This portion of the program specifies information that the applicant must provide.

· 40 CFR 51.166(n)(1) and (3) – ADEQ’s PSD SIP submittal does not appear to specifically address 

these requirements, which require that the SIP must require that (1) the owner or operator of a 

proposed source or modification shall submit all information necessary to perform any analysis 

or make any determination required under procedures established in accordance with 40 CFR 

51.166, and (2) upon request of the state, the owner or operator shall also provide specified 

information concerning air quality impacts and growth. ADEQ’s submittal at R18-2-304, R18-2-

402(G) and R18-2-407 identifies the information necessary to obtain a complete application 

under this program and requires applicants to respond to deficiencies in the application, but 

these provisions do not appear to fully address the requirements of 40 CFR 51.166(n)(1) and 

(3). To obtain full PSD program approval, ADEQ must ensure its program requires owner and 

operators to submit the required information as specified in 40 CFR 51.166(n)(1) and (3). 

40 CFR 51.166(p): Sources impacting Class I areas

This portion of the program identifies additional requirements related to protection of Federal Class I 

areas. 

· 40 CFR 51.166(p)(1) – ADEQ’s submittal does not address this requirement, but it is addressed 

by existing SIP requirements in R9-3-304(H). However, the existing SIP only requires application 

information to be submitted to the Federal Land Manager, and does not require that this 

information be provided to EPA as required by this provision. Consistent with 40 CFR 

51.166(p)(2), the Federal Land Manager works in consultation with EPA on the protection of 

Class I lands. As such, submittal of application information to EPA is necessary for full PSD 

program approval. 

· 40 CFR 51.166(p)(3) – ADEQ’s submittal does not address this requirement, but it is addressed 

by the existing SIP requirement in R9-3-304(H)(1). However, the existing SIP contains outdated 

maximum allowable increases that must be updated. 

· 40 CFR 51.166(p)(4) – ADEQ’s submittal generally includes this provision at R18-2-406(F)(2), but 

contains the phrase “no significant adverse impacts,” which is inconsistent with the federal 

regulation which requires a demonstration of “no adverse impacts.” The addition of the word 

“significant” is somewhat ambiguous in this context, but appears to allow variances under 

circumstances not allowed under the analogous federal regulation. To obtain full PSD program 

approval, ADEQ’s program must require the owner or operator of a source or modification to 

make demonstrations for Class I variances that demonstrate the emissions will have no adverse 

impacts on air quality related values. 
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· We note that ADEQ has adopted an updated visibility protection rule – R18-2-410 -- that 

inadvertently was not included in ADEQ’s NSR SIP submittal. We also reviewed that rule for 

consistency with the requirements in 40 CFR 51.166(p) with the expectation that ADEQ would 

make any necessary changes to that updated rule rather than to R9-3-304(H). See discussion of 

R18-2-410 below in Sections 5.8.3 and 5.8.4. 

40 CFR 51.166(q): Public participation 

· 40 CFR 51.166(q)(2)(ii) – ADEQ’s submittal does not ensure that materials available during the 

public comment period are available in each region in which the proposed source would be 

constructed as required by 40 CFR 51.166(q)(2)(ii). While ADEQ’s program at R18-2-330(D)(11) 

requires these materials to be available at the nearest Department office, ADEQ only has two 

Department offices. As such, it is not clear that in all instances the public affected by a 

proposed project would have reasonable access in their region to the materials specified in 40 

CFR 51.166(q)(2)(ii). To obtain full PSD program approval, ADEQ’s program must include this 

element. 

· 40 CFR 51.166(q)(2)(iii) – ADEQ’s submittal does not require ADEQ to notify the public of (1) the 

degree of increment consumption that is expected from the source or modification, or (2) the 

Director’s preliminary determination, as required by 40 CFR 51.166(q)(2)(iii). To obtain full PSD 

program approval, ADEQ’s program must include these elements. 

· 40 CFR 51.166(q)(2)(vi) and (viii) – ADEQ’s submittal does not require ADEQ to make the public 

comments and the written notification of its final determination available in the same location 

as the preliminary documents as required by 40 CFR 51.166(q)(2)(vi) and (viii). To obtain full 

PSD program approval, ADEQ’s program must include these elements. 

· 40 CFR 51.166(q)(2)(vii) – ADEQ’s submittal requires the Director to take final action on an 

application within one year of receipt of a complete application – R18-2-402(I)(3). However, 

ADEQ’s program also indicates that a source may begin actual construction once a “proposed 

final permit” is obtained. See R18-2-402(C) and R18-2-302(G). ADEQ’s regulations are 

ambiguous as to whether a proposed final permit, as defined in R18-2-101(114), constitutes 

final action by the Director that is subject to administrative and/or judicial review. As EPA has 

stated previously in the context of our actions on other State SIP submittals, we interpret the 

CAA to require an opportunity for judicial review of a decision to grant or deny a PSD permit, 

whether issued by EPA or by a State under a SIP-approved or delegated PSD program. 77 Fed. 

Reg. 65305, 65306 (Oct. 26, 2012) (EPA’s approval of the San Joaquin Valley Unified Air 

Pollution Control District’s PSD program into the California SIP); see also 61 Fed. Reg. 1880, 

1882 (Jan. 24, 1996) (EPA’s proposed disapproval of Virginia’s PSD program SIP revision due to 

State law standing requirements that limited judicial review); 72 Fed. Reg. 72617, 72619 (Dec. 

21, 2007) (in approving South Dakota’s PSD program, EPA stated that it interprets the CAA and 

regulations to require at minimum an opportunity for state judicial review of PSD permits). EPA 

continues to interpret the relevant provisions of the Act as described in these prior rulemaking 

actions. While ADEQ has issued guidance clarifying that it treats “proposed final permits” as 
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“appealable agency actions,” under Arizona law,39 in order to obtain full PSD program 

approval, ADEQ’s regulations must make clear that a source may not begin actual construction 

before a final determination on a PSD permit application is made by the Director, which would 

be subject to administrative and/or judicial review. 

40 CFR 51.166(r): Source obligation

This portion of the program requires a PSD program to require sources to meet certain obligations, 

including those related to reasonable possibility. 

· 40 CFR 51.166(r)(6) – ADEQ’s submittal contains an apparent typographical error in R18-2-

402(F)(1)(c), which includes a cross-reference to R18-2-401(20)(b)(iii) rather than R18-2-

401(20)(b)(iv). To obtain full PSD program approval, this error must be corrected to ensure that 

the requirement in 40 CFR 51.166(r)(6)(i)(c) for owners and operators to document and 

maintain a record of certain applicability-related information is satisfied. 

· 40 CFR 51.166(r)(7) – ADEQ’s submittal does not require owners or operators to make 

information required under 40 CFR 51.166(r)(6) available for review upon request by the 

Director or the general public pursuant to the requirements in 40 CFR 70.4(b)(3)(viii) as is 

required by 40 CFR 51.166(r)(7). To obtain full PSD program approval, ADEQ must add this 

requirement. 

40 CFR 51.166(w): Actuals PALs 

This portion of the PSD program contains requirements for establishing a plantwide applicability limit 

to avoid the requirement to obtain a PSD permit. To obtain full PSD program approval, ADEQ must 

address the following deficiencies in the Actuals PALs provisions of its PSD program at R18-2-412 and 

associated definitions at R18-2-401. 

· 40 CFR 51.166(w)(2)(iv) – Neither the ADEQ regulatory provisions for PALs at R18-2-412 nor the 

ADEQ regulatory definitions in R18-2-401 that apply in the context of major sources and major 

modifications contain a definition for major emissions unit as is required by 40 CFR 

51.166(w)(2)(iv). (This term is also not included in the definitions at R18-2-101 or R18-2-301 

that ADEQ submitted for approval as part of this action.) 

· 40 CFR 51.166(w)(3)(ii) – ADEQ’s PAL provision for calculating baseline emissions at R18-2-

412(B)(2) does not specify that baseline actual emissions are to include emissions associated 

not only with operation of the unit, but also emissions associated with startup, shutdown and 

malfunction, as is required by 40 CFR 51.166(w)(3)(ii). 

· 40 CFR 51.166(w)(9) – ADEQ’s PAL provisions at R18-2-412(H) contain an incorrect reference to 

(H)(4) instead of the definition for major modification, and R18-2-412(H)(5) uses “eliminated” 

where the federal regulation uses “established.” 

40 CFR 51.166(w)(10) – ADEQ’s PAL renewal provisions at R18-2-412(I)(1) must contain a 

reference to subsection (D) of R18-2-412 instead of (F). In addition, R18-2-(I)(4)(a) must 

reference subsection (E) of R18-2-412. 

 

39 See ADEQ memo dated February 10, 2015 related to proposed final permits. ADEQ submitted this memo in its February 

23, 2015 supplement. 
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Section 5.8.3 Additional Discussion of PSD Program Requirements

Condensable PM 

On December 24, 2012, regulatory revisions related to condensable PM became effective in EPA’s PSD 

regulations at 40 CFR 51.166 and 40 CFR 52.21 (see 77 Fed. Reg. 65107 (Oct. 25, 2012)). These revisions 

corrected an error where EPA inadvertently identified particulate matter (PM) as a criteria pollutant 

(that is, a pollutant subject to a NAAQS) when identifying how to treat condensable PM emissions. 

ADEQ’s submittal contains the erroneous language that was originally included in 40 CFR 51.166. By 

not including this recent EPA regulatory revision in its PSD SIP submittal, ADEQ’s submittal is 

potentially more stringent than the requirements of 40 CFR 51.166. However, EPA believes that since 

the revisions were made to correct an inadvertent technical error, ADEQ has the discretion to 

determine that PM is clearly not a criteria pollutant and to therefore implement the rule by not 

considering PM to include condensable PM. In addition, ADEQ has three years to adopt this change to 

the program pursuant to 40 CFR 51.166(a)(6). Nevertheless, for clarity, we recommend that ADEQ 

correct this error in its regulations when addressing other necessary revisions to its NSR program that 

are identified as part of this SIP action. 

Applicability to Greenhouse Gas Emissions 

ADEQ is currently subject to a Federal Implementation Plan under the PSD program for GHGs because 

ADEQ did not adopt a PSD program for the regulation of GHGs. See 40 CFR 52.37. ADEQ’s NSR SIP 

submittal does not attempt to correct this program deficiency, as regulation of GHG emissions 

currently is not permitted under State law. See A.R.S. § 49-191. 

EPA implemented the PSD program requirements for GHGs through a rulemaking known as the GHG 

Tailoring Rule. See 75 Fed. Reg. 31514 (June 3, 2010). The GHG Tailoring Rule set specific thresholds at 

which emission increases of GHGs become subject to regulation under the PSD program. The GHG 

Tailoring Rule, for the first time, added a definition to the PSD program for “subject to regulation.” 40 

CFR 51.166(b)(48). This definition is where the PSD regulations identify the thresholds for regulating 

GHGs under the PSD program. 

On June 23, 2014, the U.S. Supreme Court issued a decision in Utility Air Regulatory Group (UARG) v. 

Environmental Protection Agency (No. 12-1146) holding that EPA may not treat GHGs as an air 

pollutant for purposes of determining whether a source is a major source required to obtain a PSD 

permit (or a CAA title V permit) and thus invalidated EPA’s regulations implementing that approach. 

The Supreme Court’s decision also said that EPA could continue to require that PSD permits, otherwise 

required based on emissions of conventional pollutants, contain limitations on GHG emissions based 

on the application of BACT. EPA expects the portions of EPA’s regulations that would require sources 

emitting only GHGs in major amounts to obtain a PSD permit to be vacated by the United States Court 

of Appeals for the District of Columbia Circuit (Court of Appeals), to which the Supreme Court 

remanded the UARG case for further proceedings. Because ADEQ’s PSD program does not contain 

provisions for the regulation of GHGs, our review of ADEQ’s PSD program is not directly affected by 

these judicial proceedings. The FIP in place for GHGs for ADEQ’s PSD program will remain in place until 

such time as ADEQ adopts a PSD program for regulating GHGs, submits it to EPA for SIP approval, and 
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EPA approves the program into the SIP. 

Visibility Protection and Innovative Control Technology 

ADEQ’s updated permitting rules contain provisions related to visibility protection at R18-2-410 – 

Visibility Protection, and provisions related to innovative control technologies at R18-2-408 – 

Innovative Control Technology. ADEQ inadvertently did not include these two rules in the NSR SIP 

submittal. We note that while the innovative control technology provisions of the PSD program 

generally are not required program elements, rules in ADEQ’s SIP submittal reference these provisions 

and as a result they are necessary elements of ADEQ’s SIP-approved PSD program. 

Although R18-2-410 was not included in the NSR SIP submittal, ADEQ has older requirements approved 

into in the Arizona SIP related to visibility protection that we can rely on for our review of these 

elements of the PSD program as a part of our evaluation of the consistency of ADEQ’s submittal with 

federal PSD requirements. 

While R18-2-408 and R18-2-410 are not part of the SIP submittal that is currently before us, in order to 

facilitate ADEQ’s making any revisions to these updated rules that may be necessary for SIP approval, 

we have reviewed the rules and identified potential approval issues with these rules, which are 

described below in Section 5.8.4. Accordingly, ADEQ should be able to make the necessary revisions for 

these rules at the same time it makes the other rule revisions that we have identified as necessary as 

part of our current SIP action. We expect that ADEQ would make any necessary changes to their 

visibility protection and innovative control technology rules by revising R18-2-408 and R18-2-410 

rather than revising the rules currently in the SIP that address this subject matter. We expect that 

subsection (H) of R9-3-304, discussed above in Section 5.8.2 in the context of our review of visibility 

protection-related requirements in 40 CFR 51.166(p), would be removed from the SIP in the future 

upon EPA’s approval into the SIP of R18-2-408. See discussion of R9-3-304 in Section 7 below. 

 Section 5.8.4 Recommendations

In addition to the disapproval issues identified in Section 5.8.2, our Evaluation identifies numerous 

recommendations for correcting typographical errors and making other small revisions to ADEQ’s rules 

to provide additional clarity and consistency with the federal requirements. All of our 

recommendations are included in our Evaluation, but we specifically note: 

1. ADEQ may want to consider revising R18-2-402(D)(6) to refer to the applicability tests in (c) and 

(d), instead of just (d). 

2. ADEQ should consider revising R18-2-401(11)(e) to refer to “Article 4” instead of “this section.” 

3. ADEQ should revise R18-2-101(74)(c)(vi) to reference January 6, 1975 instead of December 12, 

1976. See 40 CFR 51.166(b)(2)(iii)(f). 

4. ADEQ should consider revising R18-2-412(A)(2)(b) to reference R18-2-402 and 406, instead of 

the “PSD program” which ADEQ has not defined. ADEQ could also add the definition of PSD 

program in 40 CFR 51.166(b)(42). 
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5. ADEQ should consider revising the definitions for PEMS and CPMS in R18-2-101 to include the 

examples included in the federal definitions at 40 CFR 51.166(b)(45) and (46). 

6. ADEQ should consider revising R18-2-401(2) to reference “a-d” instead of “a-c”. 

7. ADEQ should consider revising R18-2-217(C) to clarify that the areas listed can only be 

“designated or redesignated” as Class I or Class II areas. See 40 CFR 51.166(e)(4). 

8. ADEQ should consider revising R18-2-218(F)(4) to include “emission-related” after temporary. 

See 40 CFR 51.166(f)(1)(iii). 

9. ADEQ may want to consider revising R18-2-218(F)(5) to change the potentially outdated 

reference to “operating permit.” 

10. ADEQ should consider revising R18-2-217(F) to include language in 40 CFR 51.166(g)(3)(ii) 

relating to State legislation or confirm that State law does not require a legislative action to 

redesignate an area. 

11. ADEQ should consider revising R18-2-407(H)(1)(k) to reference “net emissions increase” for 

clarity. See 40 CFR 51.166(i)(5)(i)(f). 

12. ADEQ should consider revising R18-2-406(A) to refer to subsections (B) through (E), instead of 

(B) through (G). Subsections (F) and (G) do not appear to be applicable in this context. 

13. For R18-2-410, which was not submitted for SIP approval, we recommend the following 

changes in the event that the rule is submitted at a later date. We note that if R18-2-410, as 

currently adopted, had been submitted as part of the NSR SIP submittal, these issues would 

have been bases for limited disapproval rather than recommendations. 

a. R18-2-410(C)(2) – ADEQ should add a requirement to send application information to 

EPA at the same time as information is submitted to the Federal Land Manger. 

14. ADEQ should consider revising R18-2-412(F)(4) to reference (F)(1) instead of (F)(1)(a). 

15. For R18-2-408, which was not submitted for SIP approval, we recommend the following 

changes in the event that the rule is submitted at a later date We note that if R18-2-410, as 

currently adopted, had been submitted as part of the NSR SIP submittal, these issues would 

have been bases for limited disapproval rather than recommendations: 

a. R18-2-408(B)(2) should include a reference to (A)(1) and (A)(2). 

b. R18-2-408(B)(7) references R18-2-218, but ADEQ should add additional references as 

not all requirements in 40 CFR 51.166(p) are necessarily in R18-2-218. 

16. ADEQ should consider revising R18-2-412(H) to consistently use the term “PAL allowable 

emissions”, as defined in ADEQ’s program in R18-2-401. 

17. ADEQ should consider revising R18-2-412(H)(1)(b) to add “whether and how,” consistent with 

the federal language at 40 CFR 51.166(w)(9)(i)(b). 

18. ADEQ should consider removing R18-2-402(H). The information in this provision may be 

outdated, and already covered by incorporating Appendix W by reference. 

6. Review of Non-NSR Related Rules and Statutory Provisions

In addition to ADEQ’s NSR SIP submittal, we are taking action on rules R18-2-311 and R18-2-312. These 

rules were submitted to EPA for SIP approval in a separate submittal on May 16, 2014. We delayed 

acting on rules R18-2-311 and R18-2-312 in a previous action, and are therefore now evaluating and 
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taking action on the rules. We are also taking action on A.R.S. § 49-107, an Arizona statutory provision 

concerning local delegation of state authority. 

6. 1 R18-2-311, Test Methods and Procedures

ADEQ’s rule R18-2-311 specifies the test methods and procedures which can be used to determine 

compliance with requirements established under Arizona Administrative Code, Title 18, Chapter 2 (i.e., 

ADEQ’s air pollution control regulations) or contained in permits issued pursuant to Chapter 2. On 

October 19, 1984, EPA approved an earlier version of this rule into the SIP.40 See 49 Fed. Reg. 41026. 

The current submittal, adopted effective November 15, 1993, renumbers the earlier rule and expands 

on the previous version by listing additional test methods that may be used to determine compliance. 

While the current rule improves on the earlier version, we cannot recommend it for full approval into 

the SIP. We are proposing a limited disapproval because Section D of the rule allows the State to 

approve alternatives to the applicable SIP without EPA approval, in conflict with the requirements of 

Clean Air Act section 110(a)(2)(A) and 110(i).41 

6.2 R18-2-312, Performance Tests

ADEQ’s rule R18-2-312 requires stationary sources to conduct a performance test within 60 days of 

achieving the capability to operate at its maximum production rate, but no later than 180 days after 

initial start-up. The rule also specifies that testing shall be conducted under such conditions specified 

by State, including, but not limited to appropriate test methods, notification to the State, data 

reduction, records, and number of test runs. On April 23, 1982 (47 Fed. Reg. 17485) EPA approved a 

version of this rule into the SIP.42 The current submittal, adopted effective November 15, 1993, 

renumbers the earlier rule and expands on the previous version by including conditions when a test 

may be stopped and allows compliance to be determined with continuous emission monitoring as long 

as the applicable quality assurance procedures are followed. While the current rule improves on the 

earlier version, we cannot recommend it for full approval into the SIP. We are proposing a limited 

disapproval because Section B of the rule allows the State to approve the use of equivalent and 

alternative test methods without EPA approval, in conflict with Clean Air Act section 110(a)(2)(A) and 

110(i).43 

6.3 A.R.S. § 49-107, Local Delegation of State Authority

As discussed above in Section 5.4, A.R.S. § 49-107 is the current Arizona state law that provides ADEQ 

with authority to “delegate to a local environmental agency, county health department, public health 

services district or municipality any functions, powers or duties which the director believes can be 

 

40 The rule was previously numbered R9-3-310. 

41 See, e.g., “Guidance Document for Correcting VOC Rule Deficiencies,” U.S. EPA Region 9, April 1991, revised August 21, 

2001 (Little Bluebook). 

42 The rule was previously numbered R9-3-312. 

43 See, e.g., Little Bluebook. 
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competently, efficiently and properly performed by the local agency if the local agency accepts the 

delegation and agrees to perform the delegated functions, powers and duties according to the 

standards of performance required by law and prescribed by the director,” and other related 

authorities. This statutory provision establishes that ADEQ has clear authority to delegate various 

functions under the CAA, including NSR permitting, to county and other local government agencies 

and, as such we find it to be approvable and propose to approve it into the SIP. This provision will 

replace 7-1-8.3(R9-3-803) – Delegation of Authority, an older ADEQ currently in the SIP, which we are 

proposing to remove from the SIP as part of this action, as discussed in Section 7 below. 

7. Review of Existing SIP Rules and Statutory Provisions to be Replaced

In Section 5 we described our evaluation of ADEQ’s NSR SIP submittal to ensure it meets the NSR 

requirements of 40 CFR 51.160-166 as well as sections 160-165 of the Act for PSD, sections 172(c) and 

173 of the Act for NA-NSR, and section 110(a)(2) of the Act, and in Section 6 we discussed other ADEQ 

provisions submitted for approval into the SIP that we are taking action on as part of this action. Here 

we discuss the rules and statutory provisions in ADEQ’s current SIP that ADEQ has requested to be 

rescinded from the SIP, most of which would be replaced by the newer rules in the SIP submittal that 

are the subject of our current action. 

ADEQ’s existing SIP-approved rules are generally outdated, as we have not acted to approve 

substantial revisions to ADEQ’s NSR rules since the 1980s. Further, the ADEQ NSR rules currently in the 

SIP have been repealed for purposes of State law by ADEQ. Significant changes have been made to the 

Act and the underlying implementing federal NSR regulations since our last substantial action on 

ADEQ’s NSR SIP. Therefore, replacing the existing, outdated NSR SIP rules with the updated ADEQ rules 

in this submittal that we propose to approve into the SIP is appropriate and generally serves as an 

overall strengthening of Arizona’s SIP. In some cases, we approved updated versions of these rules into 

the SIP in previous rulemaking actions, and a few of the rules are no longer necessary for other 

reasons. The following is a list of the older SIP-approved rules that ADEQ is requesting that we remove 

from the SIP and that we are proposing to remove as part of our current action: 

R9-3-101 – Definitions (except definition (20)) 

R9-3-217(B) – Attainment Areas: Classification and Standards 

R9-3-301 – Installation Permits: General (except Subsections I and K) 

R9-3-302 – Installation Permits in Nonattainment Areas 

R9-3-303 – Offsets 

R9-3-304 – Installation Permits in Attainment Areas (except Subsection H) 

R9-3-305 – Air Quality Analysis Monitoring Requirements

R9-3-306 – Operating permits

R9-3-307 – Replacement

R9-3-308 – Permit Conditions 

R9-3-310 – Test Methods and Procedures 

R9-3-311 – Air Quality Model 

R9-3-312 – Performance Test 
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R9-3-315 – Posting of Permits

R9-3-314 – Excess Emissions Reporting

R9-3-316 – Notice by Building Permit Agencies 

R9-3-317 – Permit Non-transferable; Exception

R9-3-318 – Denial or revocation of installation or operating permit 

R9-3-319 – Permit Fees

R9-3-322 – Temporary Conditional Permits 

R9-3-1101 – Jurisdiction 

A.R.S. § 36-1706 – State and county control 

7-1-8(R9-3-801) – Original State Jurisdiction 

7-1-8.2(R9-3-802) – Assertions of Jurisdiction 

7-1-8.3(R9-3-803) – Delegation of Authority 

Appendix 4 – Fee Schedule for Installation and Operating Permits

Appendix 5 – Fee Schedule for Conditional Permits 

R9-3-101 – Definitions

ADEQ requested that existing SIP rule R9-3-101 – Definitions(except definition (20) for “begin actual 

construction”) be removed from the SIP and replaced by the addition of the definitions in R18-2-101, 

R18-2-301, and R18-2-401. Definitions in R9-3-101 were added to the SIP on several occasions in the 

late 1970s and early 1980s. However, this rule has since been repealed by ADEQ for State law 

purposes. The definitions in ADEQ’s currently adopted rules at R18-2-101, R18-2-301, R18-2-401, and 

R18-2-701 are either the same or very similar to the versions in the existing SIP. In addition, many of 

the specific definitions in the existing SIP are outdated due to the significant changes to the Act and its 

implementing federal regulations since our last action to approve these definitions. The definitions in 

R18-2-101, except for definitions (2), (20), (32), (87), (109), and (122), and the definitions in R18-2-701, 

were recently approved into the SIP.44 Therefore, our action on the NSR SIP submittal, which includes 

the addition of R18-2-101(2), (32), (87), (109), and (122), R18-2-301 and R18-2-401 into the SIP, allows 

us to rescind R9-3-101 (except for definition (20)), as this old definitions rule is no longer needed in the 

SIP, and we are proposing to remove R9-3-101 (except for R9-3-101(20)) from the Arizona SIP.

R9-3-217(B) – Attainment Areas: Classifications and Standards

ADEQ requested that subsection (B) of existing SIP rule R9-3-217 – Attainment Areas: Classifications 

and Standards be rescinded from the SIP and replaced by the addition of R18-2-218 – Limitation of 

Pollutants in Classified Attainment Areas. Both of these rules generally address the ambient air 

increment requirements under 40 CFR 51.166(c) of the PSD program. However, the current SIP 

contains very outdated increments (also referred to as “maximum allowable increases”). Therefore, it 

is appropriate to rescind R9-3-217(B) from the SIP with our action, as it is no longer needed in the 

Arizona SIP. Accordingly, we are proposing to remove R9-3-217(B) from the Arizona SIP. 

 

44 79 Fed. Reg. 56655 (Sept. 23, 2014)
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R9-3-301 – Installation Permits: General

ADEQ requested that R9-3-301 – Installation Permits: General (except for Subsections I and K) be 

rescinded from the SIP and replaced with R18-2-302 – Applicability; Registration; Classes of Permits, 

R18-2-304 – Permit Application Processing Procedures, R18-2-306 – Permit Contents, R18-2-319 – 

Minor Permit Revisions, R18-2-320 – Significant Permit Revisions, R18-2-330 – Public Participation, R18-

2-402 – General, and R18-2-407 – Air Quality Impact Analysis and Monitoring Requirements. R9-3-301 

contains preconstruction permitting requirements that: (1) require a construction permit prior to 

commencing construction, (2) identify the different types of construction permits required and which 

sources or modifications are required to obtain a particular permit, (3) identify the requirements each 

source must meet to obtain a permit, (4) identify the required application information, including 

actions to resolve application deficiencies, (5) require certain sources to assess impacts on Class I 

areas, (6) require the Director to make a preliminary determination to approve or disapprove a permit, 

(7) ensure certain public participation requirements are met, and (8) identify the duration of the 

effectiveness of the permit. With the exceptions of R9-3-301(I) and (K), these requirements are 

addressed through ADEQ’s NSR SIP submittal through the various rules identified above. However, at 

ADEQ’s request we will not act to remove R9-3-301 subsections (I) and (K) from the SIP at this time. All 

other portions of R9-3-301 can be rescinded as part of our action as they are no longer needed in the 

Arizona SIP. We are therefore proposing to remove R9-3-301 (except for R9-3-301(I) and R9-3-301(K)) 

from the Arizona SIP. 

Installation Permits in Nonattainment Areas

ADEQ requested that R9-3-302 – Installation Permits in Nonattainment Areas be rescinded from the 

SIP and replaced with R18-2-403 – Permits for Source Located in Nonattainment Areas. Both of these 

rules generally address the requirements applicable to the construction of major stationary sources 

and major modifications in nonattainment areas under 40 CFR 51.165. The basic requirements in the 

two rules are similar, with R18-2-403, ADEQ’s current version of the rule adopted for State law 

purposes, being more consistent with the current program requirements in the Act and 40 CFR 51.165. 

Therefore, it is appropriate to rescind R9-3-302 as part of our action as it is no longer needed in the 

Arizona SIP. Accordingly, we are proposing to remove R9-3-302 from the Arizona SIP. 

Offset Standards

ADEQ requested that R9-3-303 – Offset Standards be removed from the SIP and replaced with R18-2-

404 – Offset Standards. Both of these rules generally address the requirements for obtaining offsets for 

sources under the NA-NSR program. The basic requirements in the two rules are similar, with R18-2-

404, ADEQ’s current version of the rule adopted for State law purposes, being more consistent with 

the current program requirements in the Act and 40 CFR 51.165. Therefore, it is appropriate to rescind 

R9-3-303 as part of our action as it is no longer needed in the Arizona SIP. Accordingly, we are 

proposing to remove R9-3-303 from the Arizona SIP. 

Installation Permits in Attainment Areas 

ADEQ requested that R9-3-304 – Installation Permits in Attainment Areas (except Subsection H) be 

rescinded from the SIP and replaced with R18-2-406 – Permit Requirements for Sources Located in 

Attainments and Unclassifiable Areas. Both of these rules generally address the requirements for 
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obtaining a permit under the PSD program. While the basic requirements in the two rules are similar, 

the existing SIP version is extremely outdated as many revisions and additions have been added to the 

PSD program since the early 1980s. Therefore, it is appropriate to rescind R9-3-304, except for 

subsection (H), as part of our action as it is no longer needed in the SIP. Accordingly, we are proposing 

to remove R9-3-304 (except R9-3-304(H)) from the Arizona SIP.45 

Air Quality Analysis and Monitoring Requirements

ADEQ requested that R9-3-305 – Air Quality Analysis and Monitoring Requirements – be removed from 

the SIP and replaced with R18-2-407 – Air Quality Impact Analysis and Monitoring Requirements. Both 

of these rules generally address the air quality analysis and additional impact analysis requirements 

under 40 CFR 51.166(m) and (o). While the basic requirements in the two rules are similar, the existing 

SIP version contains outdated provisions associated with the PSD program that the newer version does 

not contain. Therefore, it is appropriate to rescind R9-3-305 as part of our action, as it is no longer 

needed in the SIP. Accordingly, we are proposing to remove R9-3-305 from the Arizona SIP. 

Operating Permits

ADEQ requested that R9-3-306 – Operating Permits – be rescinded from the SIP and replaced with R18-

2-302 – Applicability, Registration; Classes of Permits, R18-2-304 – Permit Application Processing 

Procedures, and R18-2-306 – Permit Contents. Existing SIP rule R9-3-306 contains requirements related 

to operating permits such as (1) the requirement to obtain an operating permit for certain sources, (2) 

the standards for granting operating permits, (3) the requirements for permit applications, and (4) the 

applicable public participation requirements. Since the inclusion of this rule in the SIP, ADEQ has 

switched to a unitary permitting program where construction and operating permits are issued in the 

same document. All of the requirements in R9-3-306 identified above are met by the NSR SIP 

submittal. Therefore, it is appropriate to rescind R9-3-306 as part of our action as it is no longer 

needed in the SIP. Accordingly, we are proposing to remove R9-3-306 from the Arizona SIP. 

Replacement

ADEQ requested that R9-3-307 – Replacement – be rescinded from the SIP and replaced with 

requirements in R19-2-402 – General. Existing SIP rule R9-3-307 contains certain criteria for 

determining whether a project at an existing major source triggers the requirement to obtain an 

installation permit. The applicability criteria for determining whether a project at an existing major 

source must obtain a major NSR permit is in the NSR SIP submittal at R18-2-402. Therefore, it is 

appropriate to rescind R9-3-307 as it is no longer needed in the SIP. Accordingly, we are proposing to 

remove R9-3-307 from the Arizona SIP. 

Permit Conditions

ADEQ requested that R9-3-308 – Permit Conditions be rescinded from the SIP and replaced with 

requirements in R18-2-306 – Permit Contents. R9-3-308 identifies the basic types of permit conditions 

the Director may include in each installation or operating permit to assure a source’s compliance with 

applicable requirements. R18-2-306 contains similar, but far more specific, requirements that must be 

 

45 See ADEQ’s February 23, 2015 SIP supplement requesting that we not act to remove subsection (H). 
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included in each Class I or Class II permit. Therefore, it is appropriate to rescind R9-3-308 from the SIP 

as part of our action, as it is no longer needed in the SIP. Accordingly, we are proposing to remove R9-

3-308 from the Arizona SIP. 

Test Methods and Procedures

ADEQ requested that R9-3-310 – Test Methods and Procedures be rescinded from the SIP and replaced 

with the requirements in R18-2-311 – Test Methods and Procedures. Both of these rules contain very 

similar requirements related to test methods and the procedures used for test methods. However, the 

differences between the two rules are not substantive and the newer version is the rule that is 

currently applicable under State law. As such, it is appropriate to rescind R9-3-310 from the SIP as part 

of our action, as it is no longer needed in the SIP. Accordingly, we are proposing to remove R9-3-310 

from the Arizona SIP. 

Air Quality Models

ADEQ requested that R9-3-311 – Air Quality Models – be rescinded from the SIP and replaced with 

R18-2-309 – Air Quality Models. Both of these rules contain requirements for air quality models used 

for determining air quality impacts in the permitting process. However, the current SIP rule contains 

outdated provisions, and is no longer needed with the addition of R18-2-309. Therefore, it is 

appropriate to rescind R9-3-311 with our action, as it is no longer needed in the SIP. Accordingly, we 

are proposing to remove R9-3-311 from the Arizona SIP. 

Performance Tests

ADEQ requested that R9-3-312 – Performance Tests be rescinded from the SIP and replaced with the 

requirements in R18-2-312 – Test Methods and Procedures. Both of these rules contain very similar 

requirements related to the requirements for performance tests. However, the differences between 

the two rules are not substantive. As such, it is appropriate to rescind R9-3-312 with our approval of 

R18-2-312, as it is no longer needed in the SIP. Accordingly, we are proposing to remove R9-3-312 from 

the Arizona SIP. 

Posting of Permits

ADEQ requested that R9-3-315 – Posting of Permits be rescinded from the SIP and replaced with R18-2-

315 – Posting of Permit. Both of these rules contain very similar requirements for posting permits at a 

permitted source. However, ADEQ has made minor changes to these provisions since R9-3-315 was 

approved into the SIP. These changes are not substantive, but the newer version of the rule represents 

the version currently applicable under state law. As such, it is appropriate to rescind R9-3-315 from the 

SIP with our action, as it is no longer needed in the SIP. Accordingly, we are proposing to remove R9-3-

315 from the Arizona SIP. 

Excess Emissions Reporting 

ADEQ requested that R9-3-314 – Excess Emissions Reporting be rescinded from the SIP and replaced 

with the requirements in R18-2-310.01 – Reporting Requirements. EPA approved R18-2-310.01 into the 

SIP on September 18, 2001 (66 Fed. Reg. 48087). Both of these rules contain very similar requirements 

related to reporting excess emissions. The differences between the two rules is not substantive. 
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Therefore, it is appropriate to rescind R9-3-314, as EPA has approved a newer version of this rule into 

the SIP. We note the ADEQ submitted a revised version of R18-2-310.01 with its NSR SIP submittal, but 

we are deferring action on those revisions at this time. As such, the existing SIP-approved version for 

R18-2-301.01 provides our basis for granting ADEQ’s request to remove R9-3-314 from the SIP. 

Notice by Building Permit Agencies

ADEQ requested that R9-3-316 – Notice by Building Permit Agencies be rescinded from the SIP and 

replaced with R18-2-316 – Notice by Building Permit Agencies. The regulatory language of these two 

rules is identical. However, the newer version represents the rule that is currently applicable under 

state law. Therefore, it is appropriate to remove R9-3-316 from the SIP with our action, as it is no 

longer needed in the SIP. Accordingly, we are proposing to remove R9-3-316 from the Arizona SIP. 

Permit Non-transferable; Exception

ADEQ requested that R9-3-317 – Permit Non-transferable; Exception be rescinded from the SIP and 

replaced with R18-2-323 – Permit Transfers. Both of these rules contain similar requirements for how 

permits may be transferred, as ADEQ has made several changes to these provisions since R9-3-316 was 

approved into the SIP. These changes were not substantive and the newer rule represents the current 

version applicable under State law. Therefore, it is appropriate to remove R9-3-316 with our action, as 

it is no longer needed in the SIP. Accordingly, we are proposing to remove R9-3-317 from the Arizona 

SIP. 

Denial or Revocation of Installation or Operating Permit

ADEQ requested that R9-3-318 – Denial or Revocation of Installation or Operating Permit – be 

rescinded from the SIP and replaced with requirements in R18-2-304 – Permit Application Processing 

Procedures and R18-2-321 – Permit Reopenings; Revocation and Reissuance; Termination. Existing SIP 

rule R9-3-318 contains provisions that require the Director to deny a permit application where the 

applicant cannot demonstrate the source will comply with the applicable requirements, and allows the 

Director to revoke a permit in certain circumstances. Similar requirements are found in ADEQ’s NSR SIP 

submittal in R18-2-304 and R19-321. As such, it is appropriate to remove R9-3-318 from the SIP with 

our action, as it is no longer needed in the SIP. Accordingly, we are proposing to remove R9-3-318 from 

the Arizona SIP. 

Permit Fees

ADEQ requested that R9-3-319 – Permit Fees, Appendix 4 – Fee Schedule for Installation and Operating 

Permits, and Appendix 5 – Fee Schedule for Conditional Permits be removed from the SIP because such 

requirements are no longer required for a SIP under section 110(a)(2)(L) of the Act. Pursuant to section 

110(a)(2)(L), a permit fee program for major stationary sources is not required for a state 

implementation plan once the approved fee program is superseded by the fee program required under 

title V of the Act. ADEQ has an approved title V fee program that applies to major stationary sources 

(and collects fees related to NSR actions), and therefore removal of these provisions from the SIP is 

appropriate. Accordingly, we are proposing to remove R9-3-319, Appendix 4, and Appendix 5 from the 

Arizona SIP. 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

Page 67 of 71

Temporary Conditional Permits

ADEQ requested that R9-3-322 – Temporary Conditional Permits be rescinded from the SIP because 

this part of its permitting program is no longer administered by ADEQ. R9-3-22 is a short, onesentence, regulation that allowed the Director to issue temporary permits. As this program is no longer 

part of ADEQ’s permitting program for State law purposes, and is not required for an NSR program, we 

find it appropriate to rescind this rule as part of our action. Accordingly, we are proposing to remove 

R9-3-318 from the Arizona SIP. 

Jurisdiction

ADEQ requested the rescission of several SIP rules and statutes that relate to permitting jurisdiction in 

Arizona. On September 23, 2014 we approved A.R.S § 49-402 – State and county control into the 

Arizona SIP. See 79 Fed. Reg. 56655 (Sept. 23, 2014). ADEQ requested that with the approval of A.R.S § 

49-402 into the SIP, we also rescind A.R.S. § 36-1706 – State and county control, 7-1-8(R9-3-801) – 

Original State Jurisdiction, and R9-3-1101 – Jurisdiction. First, A.R.S § 36-1706 appears to be an older 

version of A.R.S § 49-402, as A.R.S. § 36-1706 was submitted for approval in 1982. Therefore, rescission 

of A.R.S. § 36-1706 is appropriate and no longer needed in the SIP. Rules 7-1-8(R9-3-801), 7-1-8.3(R9-3-

803) and R9-3-1101 are implementing regulations for the corresponding statutory provisions on 

jurisdiction. These rules have been repealed by ADEQ for State law purposes and not replaced with 

new implementing regulations, and are not necessary for CAA purposes. Therefore, rescission of these 

three rules is appropriate considering our approval of the current version of 49-402 in our previous 

action, which speaks to permitting jurisdiction in Arizona. Accordingly, we are proposing to remove 

A.R.S. § 36-1706 and Rules 7-1-8(R9-3-801), 7-1-8.3(R9-3-803) and R9-3-1101 from the Arizona SIP. 

Delegation of Authority

ADEQ requested that 7-1-8.3(R9-3-803) – Delegation of Authority be rescinded from the SIP and 

replaced with requirements in A.R.S. § 49-107 – Local delegation of state authority. Both the rule and 

the statute address the delegation of permitting authority to local agencies. However, the rule in the 

SIP has been repealed for purposes of State law and is outdated. As such, it is appropriate to rescind 7-

1-8.3(R9-3-803) with our action, as it is no longer needed in the SIP with our proposed approval of 

A.R.S. § 49-107 into the SIP. Accordingly, we are proposing to remove 7-1-8.3(R9-3-803) from the 

Arizona SIP. 

Additional Recommendation

ADEQ’s submittal did not identify any rules in the existing SIP that should be rescinded with the 

addition of R18-2-217 into the SIP. However, R9-3-217(A) – Attainment areas; classification and 

standards is the existing rule in Arizona’s SIP that addresses the same general subject matter as R18-2-

217, which ADEQ has submitted for approval into the Arizona SIP. If we finalize our proposal to 

approve R18-2-217 into the Arizona SIP, we recommend that ADEQ request that R9-3-217(A) be 

rescinded from the SIP as part of its next NSR SIP submittal. 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

Page 68 of 71

8. Sections 100(a)(2)(E)(i), 110(l) and 193 of the Act

Section 110(a)(2)(E)(i) of the Act 

CAA section 110(a)(2)(E)(i) requires SIPs to provide “necessary assurances that the State (or, except 

where the Administrator deems inappropriate, the general purpose local government or governments, 

or a regional agency designated by the State or general purpose local governments for such purpose) 

will have adequate personnel, funding, and authority under State (and, as appropriate, local) law to 

carry out such implementation plan (and is not prohibited by any provision of Federal or State law from 

carrying out such implementation plan or portion thereof).” In addition, in EPA’s recent action on 

Arizona’s Infrastructure SIP for the 1997 8-hour ozone, 1997 PM2.5, and 2006 PM2.5 NAAQS, we 

conducted a detailed evaluation of Arizona legal authorities that provide for ADEQ’s implementation 

and enforcement of CAA requirements related to that Infrastructure SIP, as well as information 

showing that ADEQ has adequate funding and personnel to implement the relevant CAA SIP 

requirements, and approved that SIP submittal with respect to CAA section 110(a)(2)(E)(i). See 77 Fed. 

Reg. 66398, 66401 (Nov. 5, 2012); ‘‘Technical Support Document: Evaluation of Arizona’s Infrastructure 

SIP for the 1997 8-hour Ozone, the 1997 PM2.5, and the 2006 PM2.5 NAAQS,’’ June 15, 2012 

(document ID number EPA–R09–OAR–2012–0398–0003) at 16-22. As such, ADEQ has provided the 

necessary assurances that ADEQ will have adequate personnel, funding, and authority under State law 

to carry out the proposed revisions to ADEQ’s SIP, consistent with CAA section 110(a)(2)(E)(i).

 

Section 110(l) of the Act 

Section 110(l) states: “Each revision to an implementation plan submitted by a State under this chapter 

shall be adopted by such State after reasonable notice and public hearing. The Administrator shall not 

approve a revision of a plan if the revision would interfere with any applicable requirement concerning 

attainment and reasonable further progress (as defined in section 7501 of this title), or any other 

applicable requirement of this chapter.” 

With respect to the procedural requirements of CAA section 110(l), based on our review of the public 

process documentation included in the July 28, 2011, October 29, 2012 and July 2, 2014 submittals, we 

find that ADEQ has provided sufficient evidence of public notice and opportunity for comment and 

public hearings prior to submittal of this SIP revision and has satisfied these procedural requirements 

under CAA section 110(l). Also, see our previous discussion in Section 2.1. 

With respect to the substantive requirements of section 110(l), as discussed further below, we have 

determined that our approval of the ADEQ NSR SIP submittal and the other rules and statutory 

provisions that we are proposing to act on in this action (including but not limited to the rescission of 

numerous existing NSR SIP rules), as described in this TSD, would strengthen the applicable SIP in most 

respects. Taken in its entirety, we find that the SIP revision represents a strengthening of ADEQ’s minor 

NSR, PSD, and NA-NSR programs as compared to the existing SIP-approved NSR program for ADEQ that 

was last substantially revised in the SIP in the early 1980s, and that our approval of this SIP submittal 

would not interfere with any applicable requirement concerning attainment and reasonable further 

progress (RFP) or any other applicable requirement of the Act. 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

Page 69 of 71

First, this action corrects a number of deficiencies in ADEQ’s current SIP-approved NSR program. 

ADEQ’s existing SIP-approved program does not currently contain these significant program elements, 

which will be added with our action: 

1. Implementation of NSR requirements for PM10; 

2. Implementation of NSR requirements for PM2.5; 

3. Regulation of NOX as a precursor to ozone; 

4. Inclusion of condensable particular matter in NSR permitting for determining PM10 and PM2.5

emissions; and 

5. Ensuring that the construction or modification of certain non-major sources and non-major 

modifications will (1) not interfere with attainment or maintenance of the NAAQS and (2) 

comply with the applicable SIP. 

Further, ADEQ has also updated its program to provide for additional permitting flexibilities that have 

been added to the federal NSR program, such as PALs and the 2002 NSR Reforms. 

Second, most of the deficiencies identified in this TSD fit into one of two categories: (1) deficiencies 

that relate to an NSR program element that has been added since ADEQ’s NSR program was approved 

into the SIP (e.g., the deficiency related to the omission of the definition for major emissions unit in the 

PALs provisions), or (2) deficiencies that exist in the current SIP that were not properly identified as 

deficiencies when the provisions were approved into the SIP (e.g., ensuring protection of the NAAQS in 

areas outside of Arizona from stationary source emissions regulated under the NSR program). 

Therefore, in considering whether our proposed approval of the NSR SIP submittal will interfere with 

attainment or reasonable further progress, we only consider those deficiencies in the first category, as 

the deficiencies in the second category are already a part of the current applicable requirements for 

attainment and RFP in the Arizona SIP. In many cases, the deficiencies in the second category occurred 

because of the numerous changes to the NSR program since ADEQ’s NSR rules were last approved into 

the SIP. That is, language that may have been approvable previously is no longer approvable. 

The most significant deficiency that we have identified, as discussed in detail earlier in this TSD, is the 

absence of provisions that ensure protection of the 2012 PM2.5 NAAQS for the PSD program. We 

identify this as the “most significant” deficiency because it is the most likely to affect the substantive 

requirements of the overall application of the PSD program, compared to other deficiencies that we do 

not expect would significantly affect the review of emission impacts (e.g., administrative requirements 

for permit issuance). However, the 2012 PM2.5 NAAQS came into effect after ADEQ submitted the NSR 

SIP submittal to EPA. In addition, although such standard is currently applicable in the context of the 

PSD program, the implementation requirements for this standard are not due until 2016. Accordingly, 

there are no applicable requirements in the existing ADEQ SIP-approved NSR program related to this 

NAAQS that would be affected by the deficiencies in the submitted NSR rules we are approving. 

In addition, ADEQ has relaxed its definition of “major stationary source.” ADEQ’s previous definition 

applied the PSD and NA-NSR program requirements to existing non-major sources when a project 

would cause such a stationary source to become a “major stationary source.” ADEQ is revising its 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

Page 70 of 71

program to instead subject existing non-major sources to the major NSR program only if the project

constitutes a “major stationary source” in and of itself, consistent with federal NSR program 

requirements. We do not find this relaxation to interfere with attainment or reasonable further 

progress because ADEQ is also strengthening its minor NSR program to address emissions from larger 

modifications that do not qualify as major modifications under ADEQ’s revised NSR program. While 

these modifications would no longer be subject to the major NSR program, ADEQ’s minor NSR program 

would nonetheless apply and ensure the modification does not interfere with attainment or RFP. 

In summary, we find that, on balance, the improvements ADEQ is making to its NSR program 

outweigh the potential relaxations discussed above as compared to ADEQ’s existing SIP-approved NSR 

program. In addition, we are unaware of any reliance by ADEQ on the continuation of any specific 

aspect of the permit-related rules currently in the ADEQ portion of the Arizona SIP for the purpose of 

continued attainment or maintenance of the NAAQS. Given all these considerations, we propose to 

conclude that our approval of these updated ADEQ regulations into the Arizona SIP would not 

interfere with any applicable requirement concerning attainment and RFP or any other applicable 

requirement of the Act.46

Conclusion. For the reasons set forth above, we can approve the the ADEQ SIP revision as proposed in 

this action under section 110(l) of the Act. 

Section 193 of the Act

Section 193 of the Act, which was added by the Clean Air Act Amendments of 1990, includes a savings 

clause which provides, in pertinent part: “No control requirement in effect, or required to be adopted 

by an order, settlement agreement, or plan in effect before November 15, 1990, in any area which is a 

nonattainment area for any air pollutant may be modified after November 15, 1990, in any manner 

unless the modification insures equivalent or greater emission reductions of such air pollutant.” We 

find that the provisions included in ADEQ’s NSR SIP submittal would ensure equivalent or greater 

emission reductions compared to the SIP-approved NSR program in the nonattainment areas under 

ADEQ’s jurisdiction. In particular, the NSR provisions in ADEQ’s NSR SIP submittal cover stationary 

sources in areas that are nonattainment for the current lead, ozone, PM10, PM2.5 and 1-hr SO2 NAAQS. 

ADEQ’s current SIP-approved NSR program was approved prior to EPA establishing these NAAQS and 

the current NSR provisions in the SIP do not reference the current, recently SIP-approved Arizona air 

quality standards that are comparable to these NAAQS. In addition, ADEQ’s updated NSR rules and our 

action to approve them into the SIP will expand ADEQ’s review of minor sources in nonattainment 

areas to require review of smaller sources. We therefore conclude that ADEQ’s NSR SIP submittal will 

provide for equivalent or greater emissions reductions as compared to the existing SIP-approved ADEQ 

NSR program for the nonattainment pollutants lead, ozone, PM10, PM2.5 and SO2. 

 

46 This analysis also applies to our approval of R18-2-311 and R18-2-312, which are not generally related to NSR 

permitting. However, these rules do not contain any substantive changes in the procedures for performance tests or test 

methods than the rules in the current SIP. 
Arizona DEQ NSR Program SIP Submittal 

Technical Support Document – March 2015 

Page 71 of 71

Conclusion. For the reasons set forth above, we can approve the submitted NSR program under section 

193 of the Act. 

 

9. Summary of Proposed Action

The new or amended statutory provisions and rules evaluated herein generally meet the applicable 

CAA requirements. Our action would have the effect of significantly updating ADEQ’s SIP-approved NSR 

program. 

Pursuant to section 110(k) of the CAA and for the reasons provided above, EPA is proposing a limited 

approval and limited disapproval of revisions to the ADEQ portion of the Arizona SIP that govern the 

issuance of permits for stationary sources, including the review and permitting of major sources and 

major modifications under parts C and D of title I of the CAA. Specifically, EPA is proposing a limited 

approval and limited disapproval of the new and amended ADEQ regulations listed in Table 1, above, 

as a revision to the ADEQ portion of the Arizona SIP. In addition, EPA would remove or supersede 

existing provisions in the SIP as described in Section 8. We are also proposing to partially disapprove 

two provisions of ADEQ’s NSR program that have been vacated by the courts. Finally, we are proposing 

a limited approval of ADEQ’s nonattainment NSR program under section 189 of the Act related to PM10

and PM2.5 precursors. 

We are proposing this action because, although we find that the new and amended rules meet most of 

the applicable requirements for such permit programs and that the SIP revisions improve the existing 

SIP, we have found certain deficiencies that prevent full approval, as explained in this TSD. The 

intended effect of this proposed limited approval and limited disapproval action is to update the 

applicable SIP with current ADEQ permitting regulations and to set the stage for remedying 

deficiencies in these regulations. 

10. Attachment 

· Evaluation of 40 CFR 51.160-51.166 and the ADEQ NSR Submittal, EPA Region 9, February 2015