39592 Federal Register / Vol. 74, No. 151 / Friday, August 7, 2009 / Proposed Rules 

addresses, please see the proposed rule 

published at 74 FR 33193, July 10, 2009. 

FOR FURTHER INFORMATION CONTACT: 

James F. Burris, MD, Chief Consultant, 

Geriatrics and Extended Care State 

Home Construction Grant Program 

(114), Veterans Health Administration, 

Department of Veterans Affairs, 810 

Vermont Avenue, NW., Washington, DC 

20420, (202) 461–6774 (This is not a 

toll-free number). 

SUPPLEMENTARY INFORMATION: VA 

published a document in the Federal 

Register on July 10, 2009, at 74 FR 

33192, amending its regulations 

regarding grants to States for 

construction or acquisition of State 

homes to update the maximum number 

of nursing home and domiciliary beds 

designated for each State, and to amend 

the definition of ‘‘State.’’ This document 

corrects an error in the preamble of the 

proposed rule in the maximum number 

of beds for the State of Vermont. 

However, in the regulatory text section 

of the proposed rule contains the correct 

number of 142 beds as shown in the 

table. 

In FR Doc. E9–16341, published July 

10, 2009, (74 FR 33192), make the 

following correction: On page 33194, in 

the third column of the table ‘‘New max 

# of beds (based on 2020 projection)’’ in 

the entry for Vermont, remove the 

number ‘‘1312’’ and add, in its place, 

‘‘142’’. 

William F. Russo, 

Director, Regulations Management. 

[FR Doc. E9–18683 Filed 8–6–09; 8:45 am] 

BILLING CODE 8320–01–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Parts 52 and 96 

[EPA–R04–OAR–2009–0454; FRL–8942–3] 

Approval and Promulgation of Air 

Quality Implementation Plans; North 

Carolina; Clean Air Interstate Rule 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: EPA is proposing to approve 

a revision to the North Carolina State 

Implementation Plan (SIP) submitted by 

the State of North Carolina through the 

North Carolina Department of 

Environment and Natural Resources on 

June 20, 2008. This revision addresses 

the requirements of EPA’s Clean Air 

Interstate Rule (CAIR). Although the DC 

Circuit Court found CAIR to be flawed, 

the rule was remanded without vacatur 

and thus remains in place. Thus, EPA is 

continuing to approve CAIR provisions 

into SIPs as appropriate. CAIR, as 

promulgated, requires States to reduce 

emissions of sulfur dioxide (SO2) and 

nitrogen oxides (NOX) that significantly 

contribute to, or interfere with 

maintenance of, the national ambient air 

quality standards (NAAQS) for fine 

particulates and/or ozone in any 

downwind state. CAIR establishes 

budgets for SO2 and NOX for States that 

contribute significantly to 

nonattainment in downwind States and 

requires the significantly contributing 

States to submit SIP revisions that 

implement these budgets. States have 

the flexibility to choose which control 

measures to adopt to achieve the 

budgets, including participation in EPAadministered cap-and-trade programs 

addressing SO2, NOX annual, and NOX

ozone season emissions. In the full SIP 

revision that EPA is proposing to 

approve, North Carolina will meet CAIR 

requirements by participating in these 

cap-and-trade programs. EPA is 

proposing to approve the full SIP 

revision, as interpreted and clarified 

herein, as fully implementing the CAIR 

requirements for North Carolina. 

Consequently, this action will also 

cause the CAIR Federal Implementation 

Plans (CAIR FIPs) concerning SO2, NOX

annual, and NOX ozone season 

emissions by North Carolina sources to 

be automatically withdrawn. 

DATES: Comments must be received on 

or before September 8, 2009. 

ADDRESSES: Submit your comments, 

identified by Docket ID No. EPA–R04– 

OAR–2009–0454, by one of the 

following methods: 

1. http://www.regulations.gov: Follow 

the on-line instructions for submitting 

comments. 

2. E-mail: benjamin.lynorae@epa.gov. 

3. Fax: 404–562–9019. 

4. Mail: EPA–R04–OAR–2009–0454, 

Regulatory Development Section, Air 

Planning Branch, Air, Pesticides and 

Toxics Management Division, U.S. 

Environmental Protection Agency, 

Region 4, 61 Forsyth Street, SW., 

Atlanta, Georgia 30303–8960. 

5. Hand Delivery or Courier: Lynorae 

Benjamin, Chief, Regulatory 

Development Section, Air Planning 

Branch, Air, Pesticides and Toxics 

Management Division, U.S. 

Environmental Protection Agency, 

Region 4, 61 Forsyth Street, SW., 

Atlanta, Georgia 30303–8960. Such 

deliveries are only accepted during the 

Regional Office’s normal hours of 

operation. The Regional Office’s official 

hours of business are Monday through 

Friday, 8:30 to 4:30, excluding Federal 

holidays. 

Instructions: Direct your comments to 

Docket ID No. EPA–R04–OAR–2009– 

0454. EPA’s policy is that all comments 

received will be included in the public 

docket without change and may be 

made available online at http:// 

www.regulations.gov, including any 

personal information provided, unless 

the comment includes information 

claimed to be Confidential Business 

Information (CBI) or other information 

whose disclosure is restricted by statute. 

Do not submit through http:// 

www.regulations.gov or e-mail, 

information that you consider to be CBI 

or otherwise protected. The http:// 

www.regulations.gov Web site is an 

‘‘anonymous access’’ system, which 

means EPA will not know your identity 

or contact information unless you 

provide it in the body of your comment. 

If you send an e-mail comment directly 

to EPA without going through http:// 

www.regulations.gov, your e-mail 

address will be automatically captured 

and included as part of the comment 

that is placed in the public docket and 

made available on the Internet. If you 

submit an electronic comment, EPA 

recommends that you include your 

name and other contact information in 

the body of your comment and with any 

disk or CD–ROM you submit. If EPA 

cannot read your comment due to 

technical difficulties and cannot contact 

you for clarification, EPA may not be 

able to consider your comment. 

Electronic files should avoid the use of 

special characters, any form of 

encryption, and be free of any defects or 

viruses. For additional information 

about EPA’s public docket visit the EPA 

Docket Center homepage at http:// 

www.epa.gov/epahome/dockets.htm. 

Docket: All documents in the 

electronic docket are listed in the 

http://www.regulations.gov index. 

Although listed in the index, some 

information is not publicly available, 

i.e., CBI or other information whose 

disclosure is restricted by statute. 

Certain other material, such as 

copyrighted material, is not placed on 

the Internet and will be publicly 

available only in hard copy form. 

Publicly available docket materials are 

available either electronically in http:// 

www.regulations.gov or in hard copy at 

the Regulatory Development Section, 

Air Planning Branch, Air, Pesticides and 

Toxics Management Division, U.S. 

Environmental Protection Agency, 

Region 4, 61 Forsyth Street, SW., 

Atlanta, Georgia 30303–8960. EPA 

requests that if at all possible, you 

contact the person listed in the FOR

FURTHER INFORMATION CONTACT section to 

schedule your inspection. The Regional 


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1On May 11, 2009, North Carolina submitted a 

letter of clarification related to this SIP revision. 

This letter clarifies the reference to ‘‘NOX ozone 

season trading program’’ in 15A North Carolina 

Administrative Code (NCAC) 02D.2401(b)(3)(4) was 

intended to refer to the CAIR NOX ozone season 

trading program. North Carolina also clarified the 

reference to ‘‘oil’’ in 15A NCAC 02D.2401(b)(3)(B) 

to mean fuel oil as that term is used in 40 CFR 

96.4(b)(1)(i). Further, North Carolina acknowledged 

that the reference to 40 CFR 96.4(b)(1)(iii) in 15 A 

NCAC 02D .2401(b)(3)(C) is not a restriction on 

hours of operation but rather provides how a unit’s 

potential NOX mass emissions shall be calculated. 

Office’s official hours of business are 

Monday through Friday, 8:30 to 4:30, 

excluding Federal holidays. 

FOR FURTHER INFORMATION CONTACT: 

Steven Scofield, Regulatory 

Development Section, Air Planning 

Branch, Air, Pesticides and Toxics 

Management Division, U.S. 

Environmental Protection Agency, 

Region 4, 61 Forsyth Street, SW., 

Atlanta, Georgia 30303–8960. The 

telephone number is (404) 562–9034. 

Mr. Scofield can also be reached via 

electronic mail at 

scofield.steve@epa.gov. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. What Action is EPA Proposing to Take? 

II. What is the Regulatory History of CAIR 

and the CAIR FIPs? 

III. What are the General Requirements of 

CAIR and the CAIR FIPs? 

IV. What are the Types of CAIR SIP 

Submittals? 

V. Analysis of North Carolina’s CAIR SIP 

Submittal 

A. State Budgets for Allowance Allocations 

B. CAIR Cap-and-Trade Programs 

C. Applicability Provisions 

D. NOX Allowance Allocations 

E. Allocation of NOX Allowances From 

Compliance Supplement Pool 

F. Individual Opt-In Units 

VI. Proposed Action 

VII. Statutory and Executive Order Reviews 

I. What Action Is EPA Proposing to 

Take? 

EPA is proposing to approve, the full 

SIP revision, submitted by North 

Carolina on June 20, 2008, as 

interpreted and clarified herein 1 as 

meeting the applicable CAIR 

requirements by requiring certain 

electric generating units (EGUs) to 

participate in the EPA-administered 

CAIR cap-and-trade programs 

addressing SO2, NOX annual, and NOX

ozone season emissions. As a 

consequence of the SIP approval, the 

CAIR FIPs concerning SO2, NOX annual, 

and NOX ozone season emissions for 

North Carolina are automatically 

withdrawn. If this proposal is finalized, 

the automatic withdrawal will be 

reflected in the rule text that will 

accompany the final rulemaking notice, 

and will delete and reserve the 

provisions in Part 52 that establish the 

CAIR FIPs for North Carolina sources. 

II. What Is the Regulatory History of the 

CAIR and the CAIR FIPs? 

EPA published CAIR on May 12, 2005 

(70 FR 25162). In this rule, EPA 

determined that 28 States and the 

District of Columbia contribute 

significantly to nonattainment and 

interfere with maintenance of the 

NAAQS for fine particles (PM2.5) and/or 

8-hour ozone in downwind States in the 

eastern part of the country. As a result, 

EPA required those upwind States to 

revise their SIPs to include control 

measures that reduce emissions of SO2, 

which is a precursor to PM2.5 formation, 

and/or NOX, which is a precursor to 

both ozone and PM2.5 formation. For 

jurisdictions that contribute 

significantly to downwind PM2.5

nonattainment, CAIR sets annual Statewide emission reduction requirements 

(i.e., budgets) for SO2 and annual Statewide emission reduction requirements 

for NOX. Similarly, for jurisdictions that 

contribute significantly to 8-hour ozone 

nonattainment, CAIR sets State-wide 

emission reduction requirements or 

budgets for NOX for the ozone season 

(May 1 to September 30). Under CAIR, 

States may implement these reduction 

requirements by participating in the 

EPA-administered cap-and-trade 

programs or by adopting any other 

control measures. 

CAIR explains to subject States what 

must be included in SIPs to address the 

requirements of section 110(a)(2)(D) of 

the Clean Air Act (CAA) with regard to 

interstate transport with respect to the 

8-hour ozone and PM2.5 NAAQS. EPA 

made national findings, effective on 

May 25, 2005, that the States had failed 

to submit SIPs meeting the requirements 

of section 110(a)(2)(D). The SIPs were 

due in July 2000, 3 years after the 

promulgation of the 8-hour ozone and 

PM2.5 NAAQS. These findings started a 

2-year clock for EPA to promulgate a FIP 

to address the requirements of section 

110(a)(2)(D). Under CAA section 

110(c)(1), EPA may issue a FIP anytime 

after such findings are made and must 

do so within two years unless a SIP 

revision correcting the deficiency is 

approved by EPA before the FIP is 

promulgated. 

On April 28, 2006, EPA promulgated 

FIPs for all States covered by CAIR in 

order to ensure the emissions reductions 

required by CAIR are achieved on 

schedule. The CAIR FIPs require EGUs 

to participate in the EPA-administered 

CAIR SO2, NOX annual, and NOX ozone 

season trading programs, as appropriate. 

The CAIR FIP SO2, NOX annual, and 

NOX ozone season trading programs 

impose essentially the same 

requirements as, and are integrated 

with, the respective CAIR SIP trading 

programs. The integration of the FIP and 

SIP trading programs means that these 

trading programs will work together to 

effectively create a single trading 

program for each regulated pollutant 

(SO2, NOX annual, and NOX ozone 

season) in all States covered by the 

CAIR FIP or SIP trading program for that 

pollutant. Further, as provided in a rule 

published by EPA on November 2, 2007, 

a State’s CAIR FIP is automatically 

withdrawn when EPA approves a SIP 

revision, in its entirely and without any 

conditions, as fully meeting the 

requirements of CAIR. Where only 

portions of the SIP revision are 

approved, the corresponding portions of 

the FIP are automatically withdrawn 

and the remaining portions of the FIP 

stay in place. Finally, the CAIR FIPs 

also allow States to submit abbreviated 

SIP revisions that, if approved by EPA, 

will automatically replace or 

supplement certain CAIR FIP provisions 

(e.g., the methodology for allocating 

NOX allowances to sources in the State), 

while the CAIR FIP remains in place for 

all other provisions. 

On April 28, 2006, EPA published 

two additional CAIR-related final rules 

that added the States of Delaware and 

New Jersey to the list of States subject 

to CAIR for PM2.5 and announced EPA’s 

final decisions on reconsideration of 

five issues, without making any 

substantive changes to the CAIR 

requirements. On October 19, 2007, EPA 

amended CAIR and the CAIR FIPs to 

clarify the definition of ‘‘cogeneration 

unit’’ and thus the applicability of the 

CAIR trading program to cogeneration 

units. 

EPA was sued by a number of parties 

on various aspects of CAIR, and on July 

11, 2008, the U.S. Court of Appeals for 

the District of Columbia Circuit issued 

its decision to vacate and remand both 

CAIR and the associated CAIR FIPs in 

their entirety. North Carolina v. EPA, 

531 F.3d 836 (DC Cir. Jul. 11, 2008). 

However, in response to EPA’s petition 

for rehearing, the Court issued an order 

remanding CAIR to EPA without 

vacating either CAIR or the CAIR FIPs. 

North Carolina v. EPA, 550 F.3d 1176 

(DC Cir. Dec. 23, 2008). The Court 

thereby left CAIR in place in order to 

‘‘temporarily preserve the 

environmental values covered by CAIR’’ 

until EPA replaces it with a rule 

consistent with the Court’s opinion. Id. 

at 1178. The Court directed EPA to 

‘‘remedy CAIR’s flaws’’ consistent with 

its July 11, 2008 opinion, but declined 

to impose a schedule on EPA for 


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2The Court also determined that the CAIR trading 

programs were unlawful (Id. at 906–8) and that the 

treatment of CAA title IV allowances in CAIR was 

unlawful (Id. at 921–23). For the same reasons that 

EPA is approving the provisions of North Carolina’s 

SIP revision that use the SO2 and NOX budgets set 

in CAIR, EPA is also approving, as discussed below, 

North Carolina’s SIP revision to the extent the SIP 

revision adopts the CAIR trading programs, 

including the provisions addressing applicability, 

allowance allocations, and use of title IV 

allowances. 

completing that action. Id. Therefore, 

CAIR and the CAIR FIP are currently in 

effect in North Carolina. 

III. What are the General Requirements 

of CAIR and the CAIR FIPs? 

CAIR establishes State-wide emission 

budgets for SO2 and NOX and is to be 

implemented in two phases. The first 

phase of NOX reductions starts in 2009 

and continues through 2014, while the 

first phase of SO2 reductions starts in 

2010 and continues through 2014. The 

second phase of reductions for both 

NOX and SO2 starts in 2015 and 

continues thereafter. CAIR requires 

States to implement the budgets by 

either: (1) Requiring EGUs to participate 

in the EPA-administered cap-and-trade 

programs; or (2) adopting other control 

measures of the State’s choosing and 

demonstrating that such control 

measures will result in compliance with 

the applicable State SO2 and NOX

budgets. 

The May 12, 2005 and April 28, 2006 

CAIR rules provide model rules that 

States must adopt (with certain limited 

changes, if desired) if they want to 

participate in the EPA-administered 

trading programs. With two exceptions, 

only States that choose to meet the 

requirements of CAIR through methods 

that exclusively regulate EGUs are 

allowed to participate in the EPAadministered trading programs. One 

exception is for States that adopt the 

opt-in provisions of the model rules to 

allow non-EGUs individually to opt into 

the EPA-administered trading programs. 

The other exception is for States that 

include all non-EGUs from their NOX

SIP Call trading programs in their CAIR 

NOX ozone season trading programs. 

IV. What are the Types of CAIR SIP 

Submittals? 

States have the flexibility to choose 

the type of control measures they will 

use to meet the requirements of CAIR. 

EPA anticipates that most States will 

choose to meet the CAIR requirements 

by selecting an option that requires 

EGUs to participate in the EPAadministered CAIR cap-and-trade 

programs. For such States, EPA has 

provided two approaches for submitting 

and obtaining approval for CAIR SIP 

revisions. States may submit full SIP 

revisions that adopt the model CAIR 

cap-and-trade rules. If approved, these 

SIP revisions will fully replace the CAIR 

FIPs. Alternatively, States may submit 

abbreviated SIP revisions. These SIP 

revisions will not replace the CAIR FIPs; 

however, the CAIR FIPs provide that, 

when approved, the provisions in these 

abbreviated SIP revisions will be used 

instead of or in conjunction with, as 

appropriate, the corresponding 

provisions of the CAIR FIPs (e.g., the 

NOX allowance allocation 

methodology). 

A State submitting a full SIP revision 

may either adopt regulations that are 

substantively identical to the model 

rules or incorporate by reference the 

model rules. CAIR provides that States 

may only make limited changes to the 

model rules if the States want to 

participate in the EPA-administered 

trading programs. A full SIP revision 

may change the model rules only by 

altering their applicability and 

allowance allocation provisions to: 

1. Include all NOX SIP Call trading 

sources that are not EGUs under CAIR 

in the CAIR NOX ozone season trading 

program; 

2. Provide for State allocation of NOX

annual or ozone season allowances 

using a methodology chosen by the 

State; 

3. Provide for State allocation of NOX

annual allowances from the compliance 

supplement pool (CSP) using the State’s 

choice of allowed, alternative 

methodologies; or 

4. Allow units that are not otherwise 

CAIR units to opt individually into the 

CAIR SO2, NOX annual, or NOX ozone 

season trading programs under the optin provisions in the model rules. 

An approved CAIR full SIP revision 

addressing EGUs’ SO2, NOX annual, or 

NOX ozone season emissions will 

replace the CAIR FIP for that State for 

the respective EGU emissions. As 

discussed above, EPA approval in full, 

without any conditions, of a CAIR full 

SIP revision causes the CAIR FIPs to be 

automatically withdrawn. 

V. Analysis of North Carolina’s CAIR 

SIP Submittal 

A. State Budgets for Allowance 

Allocations 

The CAIR NOX annual and ozone 

season budgets were developed from 

historical heat input data for EGUs. 

Using these data, EPA calculated annual 

and ozone season regional heat input 

values, which were multiplied by 0.15 

pounds per million British thermal unit 

(lb/mmBtu) for phase 1, and 0.125 lb/ 

mmBtu, for phase 2, to obtain regional 

NOX budgets for 2009–2014 and for 

2015 and thereafter, respectively. EPA 

derived the State NOX annual and ozone 

season budgets from the regional 

budgets using State heat input data 

adjusted by fuel factors. 

The CAIR State SO2 budgets were 

derived by discounting the tonnage of 

emissions authorized by annual 

allowance allocations under the Acid 

Rain Program under title IV of the CAA. 

Under CAIR, each allowance allocated 

in the Acid Rain Program for the years 

in phase 1 of CAIR (2010 through 2014) 

authorizes 0.50 ton of SO2 emissions in 

the CAIR trading program, and each 

Acid Rain Program allowance allocated 

for the years in phase 2 of CAIR (2015 

and thereafter) authorizes 0.35 ton of 

SO2 emissions in the CAIR trading 

program. 

In today’s action, EPA is proposing to 

approve North Carolina’s SIP revision 

that adopts the budgets established for 

the State in CAIR. These budgets are 

62,183 tons for NOX annual emissions 

from 2009 through 2014, and 51,819 

tons from 2015 and thereafter; 28,392 

tons for NOX ozone season emissions 

from 2009 through 2014, and 23,660 

tons from 2015 and thereafter; and 

137,342 tons for SO2 annual emissions 

from 2010 through 2014, and 96,139 

tons from 2015 and thereafter. 

Additionally, because North Carolina 

has chosen to include all non-EGUs in 

the State’s NOX SIP call trading 

program, the CAIR NOX ozone season 

budget will be increased annually by 

2,443 tons to account for such NOX SIP 

Call trading sources. North Carolina’s 

SIP revision sets these budgets as the 

total amounts of allowances available 

for allocation for each year under the 

EPA-administered cap-and-trade 

programs. 

EPA notes that, in North Carolina, 531 

F.3d at 916–21, the Court determined, 

among other things, that the State SO2

and NOX budgets established in CAIR 

were arbitrary and capricious.2

However, as discussed above, the Court 

also decided to remand CAIR but to 

leave the rule in place in order to 

‘‘temporarily preserve the 

environmental values covered by CAIR’’ 

pending EPA’s development and 

promulgation of a replacement rule that 

remedies CAIR’s flaws. North Carolina, 

550 F.3d at 1178. EPA had indicated to 

the Court that development and 

promulgation of a replacement rule 

would take about two years. Reply in 

Support of Petition for Rehearing or 

Rehearing en Banc at 5 (filed Nov. 17, 

2008 in North Carolina v. EPA, Case No. 

05–1224, DC Cir.). The process at EPA 

of developing a proposal that will 

undergo notice and comment and result 


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in a final replacement rule is ongoing. 

In the meantime, consistent with the 

Court’s orders, EPA is implementing 

CAIR by approving State SIP revisions 

that are consistent with CAIR (such as 

the provisions setting State SO2 and 

NOX budgets for the CAIR trading 

programs) in order to ‘‘temporarily 

preserve’’ the environmental benefits 

achievable under the CAIR trading 

programs. 

On May 7, 2009, EPA participated in 

a teleconference with North Carolina 

and requested several clarifications. 

EPA received a letter from North 

Carolina dated May 8, 2009, that 

provided the requested clarifications. 

Specifically, in the May 8, 2009, letter 

the State clarified references in North 

Carolina’s rule to ‘‘CAIR NOX Ozone 

Season trading program’’ and ‘‘fuel oil.’’ 

In addition, North Carolina 

acknowledged that the reference to 40 

CFR 96.4(b)(1)(iii) in 15A North 

Carolina Administrative Code (NCAC) 

02D .2401(b)(3)(c) is not a restriction on 

hours of operation, but rather provides 

how a unit’s potential NOX mass 

emissions will be calculated. 

B. CAIR Cap-and-Trade Programs 

The CAIR NOX annual and ozoneseason model trading rules both largely 

mirror the structure of the NOX SIP Call 

model trading rule in 40 CFR Part 96, 

subparts A through I. While the 

provisions of the NOX annual and 

ozone-season model rules are similar, 

there are some differences. For example, 

the NOX annual model rule (but not the 

NOX ozone season model rule) provides 

for a CSP, which is discussed below and 

under which allowances may be 

awarded for early reductions of NOX

annual emissions. As a further example, 

the NOX ozone season model rule 

reflects the fact that the CAIR NOX

ozone season trading program replaces 

the NOX SIP Call trading program after 

the 2008 ozone season and is 

coordinated with the NOX SIP Call 

program. The NOX ozone season model 

rule provides incentives for early 

emissions reductions by allowing 

banked, pre-2009 NOX SIP Call 

allowances to be used for compliance in 

the CAIR NOX ozone-season trading 

program. In addition, States have the 

option of continuing to meet their NOX

SIP Call requirement by participating in 

the CAIR NOX ozone season trading 

program and including all their NOX SIP 

Call trading sources in that program. 

The provisions of the CAIR SO2

model rule are also similar to the 

provisions of the NOX annual and ozone 

season model rules. However, the SO2

model rule is coordinated with the 

ongoing Acid Rain SO2 cap-and-trade 

program under CAA title IV. The SO2

model rule uses the title IV allowances 

for compliance, with each allowance 

allocated for 2010–2014 authorizing 

only 0.50 ton of emissions and each 

allowance allocated for 2015 and 

thereafter authorizing only 0.35 ton of 

emissions. Banked title IV allowances 

allocated for years before 2010 can be 

used at any time in the CAIR SO2 capand-trade program, with each such 

allowance authorizing 1 ton of 

emissions. Title IV allowances are to be 

freely transferable among sources 

covered by the Acid Rain Program and 

sources covered by the CAIR SO2 capand-trade program. 

EPA also used the CAIR model 

trading rules as the basis for the trading 

programs in the CAIR FIPs. The CAIR 

FIP trading rules are virtually identical 

to the CAIR model trading rules, with 

changes made to account for Federal 

rather than State implementation. The 

CAIR model SO2, NOX annual, and NOX

ozone season trading rules and the 

respective CAIR FIP trading rules are 

designed to work together as integrated 

SO2, NOX annual, and NOX ozone 

season trading programs. 

In the SIP revision, North Carolina 

chooses to implement its CAIR budgets 

by requiring EGUs to participate in EPAadministered cap-and-trade programs 

for SO2, NOX annual, and NOX ozone 

season emissions. North Carolina has 

adopted a full SIP revision that adopts, 

with certain allowed changes discussed 

below, the CAIR model cap-and-trade 

rules for SO2, NOX annual, and NOX

ozone season emissions. 

C. Applicability Provisions 

In general, the CAIR model trading 

rules apply to any stationary, fossil-fuelfired boiler or stationary, fossil-fuelfired combustion turbine serving at any 

time, since the later of November 15, 

1990, or the start-up of the unit’s 

combustion chamber, a generator with 

nameplate capacity of more than 25 

megawatt electrical (MWe) producing 

electricity for sale. 

States have the option of bringing in, 

for the CAIR NOX ozone season program 

only, those units in the State’s NOX SIP 

Call trading program that are not EGUs 

as defined under CAIR. EPA advises 

States exercising this option to add the 

applicability provisions in the State’s 

NOX SIP Call trading rule for non-EGUs 

to the applicability provisions in 40 CFR 

96.304 in order to include in the CAIR 

NOX ozone season trading program all 

units required to be in the State’s NOX

SIP Call trading program that are not 

already included under 40 CFR 96.304. 

Under this option, the CAIR NOX ozone 

season program must cover all large 

industrial boilers and combustion 

turbines, as well as any small EGUs (i.e. 

units serving a generator with a 

nameplate capacity of 25 MWe or less) 

that the State currently requires to be in 

the NOX SIP Call trading program. 

North Carolina has chosen to expand 

the applicability provisions of the CAIR 

NOX ozone season trading program to 

include all non-EGUs in the State’s NOX

SIP Call trading program. 

D. NOX Allowance Allocations 

Under the NOX allowance allocation 

methodology in the CAIR model trading 

rules and in the CAIR FIP, NOX annual 

and ozone season allowances are 

allocated to units that have operated for 

five years, based on heat input data from 

a three-year period that are adjusted for 

fuel type by using fuel factors of 1.0 for 

coal, 0.6 for oil, and 0.4 for other fuels. 

The CAIR model trading rules and the 

CAIR FIP also provide a new unit setaside from which units without five 

years of operation are allocated 

allowances based on the units’ prior 

year emissions. 

States may establish in their SIP 

submissions a different NOX allowance 

allocation methodology that will be 

used to allocate allowances to sources in 

the States if certain requirements are 

met concerning the timing of 

submission of units’ allocations to the 

Administrator for recordation and the 

total amount of allowances allocated for 

each control period. In adopting 

alternative NOX allowance allocation 

methodologies, States have flexibility 

with regard to: 

1. The cost to recipients of the 

allowances, which may be distributed 

for free or auctioned; 

2. The frequency of allocations; 

3. The basis for allocating allowances, 

which may be distributed, for example, 

based on historical heat input or electric 

and thermal output; and 

4. The use of allowance set-asides 

and, if used, their size. 

North Carolina has chosen to 

distribute NOX annual and NOX ozone 

season allowances with its own 

methodology. North Carolina has 

chosen to distribute NOX annual 

allowances by submitting the table 

adopted in 15A NCAC 02D .2403(a) 

which establishes the North Carolina 

CAIR NOX annual allocation for existing 

units. North Carolina has chosen to 

establish a new unit set aside for each 

control period. For CAIR NOX emissions 

for each control period, CAIR NOX

allowances available for allocation for 

new unit set asides will be 2,638 tons 

for 2009–2014 and 1,154 tons for 2015 

and thereafter. 


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North Carolina has chosen to 

distribute NOX ozone season allowances 

by submitting the table adopted in 15A 

NCAC 02D .2405(a)(1) which establishes 

the North Carolina CAIR NOX ozone 

season allocations for existing units. 

North Carolina has chosen to establish 

a new unit set aside for each control 

period. For CAIR NOX ozone season 

emissions, allowances available for 

allocation for new unit set asides will be 

1,234 tons for 2009–2014 and 555 tons 

for 2015 and thereafter. 

The State’s NOX ozone season 

allocation provisions have been 

modified to add requirements associated 

with North Carolina’s option to bring its 

non-EGUs into the CAIR NOX ozone 

season trading program. The State has 

chosen to distribute CAIR NOX Ozone 

season allowances to non-EGUs by 

submitting a table adopted in 15A 

NCAC 02D .2405(a)(2). 

E. Allocation of NOX Allowances From 

Compliance Supplement Pool 

The CAIR establishes a CSP to 

provide an incentive for early 

reductions in NOX annual emissions. 

The CSP consists of 200,000 CAIR NOX

annual allowances of vintage 2009 for 

the entire CAIR region, and a State’s 

share of the CSP is based upon the 

projected magnitude of the emission 

reductions required by CAIR in that 

State. States may distribute CSP 

allowances, one allowance for each ton 

of early reduction, to sources that make 

NOX reductions during 2007 or 2008 

beyond what is required by any 

applicable State or Federal emission 

limitation. States also may distribute 

CSP allowances based upon a 

demonstration of need for an extension 

of the 2009 deadline for implementing 

emission controls. 

The CAIR annual NOX model trading 

rule establishes specific methodologies 

for allocations of CSP allowances. States 

may choose an allowed, alternative CSP 

allocation methodology to be used to 

allocate CSP allowances to sources in 

the States. 

Consistent with the flexibility given to 

States in the model trading rule, North 

Carolina has not chosen to modify the 

provisions of the CAIR NOX annual 

model trading rule concerning the 

allocation of allowances from the CSP. 

North Carolina has not chosen to adopt 

CSP provisions since the State does not 

have any allowances available to 

allocate under the CSP provisions. 

F. Individual Opt-in Units 

The opt-in provisions of the CAIR SIP 

model trading rules allow certain nonEGUs (i.e., boilers, combustion turbines, 

and other stationary fossil-fuel-fired 

devices) that do not meet the 

applicability criteria for a CAIR trading 

program to participate voluntarily in 

(i.e., opt into) the CAIR trading program. 

A non-EGU may opt into one or more 

of the CAIR trading programs. In order 

to qualify to opt into a CAIR trading 

program, a unit must vent all emissions 

through a stack and be able to meet 

monitoring, recordkeeping, and 

recording requirements of 40 CFR part 

75. The owners and operators seeking to 

opt a unit into a CAIR trading program 

must apply for a CAIR opt-in permit. If 

the unit is issued a CAIR opt-in permit, 

the unit becomes a CAIR unit, is 

allocated allowances, and must meet the 

same allowance-holding and emissions 

monitoring and reporting requirements 

as other units subject to the CAIR 

trading program. The opt-in provisions 

provide for two methodologies for 

allocating allowances for opt-in units, 

one methodology that applies to opt-in 

units in general and a second 

methodology that allocates allowances 

only to opt-in units that the owners and 

operators intend to repower before 

January 1, 2015. 

States have several options 

concerning the opt-in provisions. States 

may adopt the CAIR opt-in provisions 

entirely or may adopt them but exclude 

one of the methodologies for allocating 

allowances. States may also decline to 

adopt the opt-in provisions at all. 

Consistent with the flexibility given to 

States in the FIPs, North Carolina has 

chosen to allow non-EGUs meeting 

certain requirements to participate in 

the CAIR NOX annual trading program. 

The North Carolina rule allows for both 

the opt-in allocation methods as 

specified in 40 CFR part 96, Subpart II 

of the CAIR NOX annual trading 

program. 

Consistent with the flexibility given to 

the States in the FIPs, North Carolina 

has chosen to permit non-EGUs meeting 

certain requirements to participate in 

the CAIR NOX ozone season trading 

program. The North Carolina rule allows 

for both of the opt-in allocation methods 

as specified in 40 CFR part 96 Subpart 

III of the CAIR NOX ozone season 

trading program. 

Consistent with the flexibility given to 

the States in the FIPs, North Carolina 

has chosen to allow certain non-EGUs to 

opt into the CAIR SO2 trading program. 

The North Carolina rule allows for both 

of the opt-in allocation methods as 

specified in 40 CFR part 96 Subpart III 

of the CAIR SO2 trading program. 

VI. Proposed Action 

EPA is proposing to approve, as 

interpreted and clarified herein, North 

Carolina’s full CAIR SIP revision 

submitted on June 20, 2008. Under the 

approved SIP revision, North Carolina is 

choosing to participate in the EPAadministered CAIR cap-and-trade 

programs for SO2, NOX annual, and NOX

ozone season emissions. The approved 

SIP revision, as interpreted and clarified 

herein, meets the applicable 

requirements of CAIR, which are set 

forth in 40 CFR 51.123(o) and (aa), with 

regard to NOX annual and NOX ozone 

season emissions, and 40 CFR 51.124(o), 

with regard to SO2 emissions. If this 

proposed approval for North Carolina’s 

full CAIR SIP revision is finalized, EPA 

will promulgate, in conjunction with 

the final rule for this action, rules 

implementing the automatic 

withdrawal—in accordance with 40 CFR 

52.35 and 52.36—of the CAIR FIPs for 

SO2, NOX annual, and NOX ozone 

season emissions for North Carolina 

sources. 

VII. Statutory and Executive Order 

Reviews 

Under the CAA, the Administrator is 

required to approve a SIP submission 

that complies with the provisions of the 

Act and applicable Federal regulations. 

42 U.S.C. 7410(k); 40 CFR 52.02(a). 

Thus, in reviewing SIP submissions, 

EPA’s role is to approve State choices, 

provided that they meet the criteria of 

the CAA. Accordingly, this proposed 

action merely approves State law as 

meeting Federal requirements and does 

not impose additional requirements 

beyond those imposed by State law. For 

that reason, this proposed action: 

• Is not a ‘‘significant regulatory 

action’’ subject to review by the Office 

of Management and Budget under 

Executive Order 12866 (58 FR 51735, 

October 4, 1993); 

• Does not impose an information 

collection burden under the provisions 

of the Paperwork Reduction Act (44 

U.S.C. 3501 et seq.); 

• Is certified as not having a 

significant economic impact on a 

substantial number of small entities 

under the Regulatory Flexibility Act (5 

U.S.C. 601 et seq.); 

• Does not contain any unfunded 

mandate or significantly or uniquely 

affect small governments, as described 

in the Unfunded Mandates Reform Act 

of 1995 (Pub. L. 104–4); 

• Does not have Federalism 

implications as specified in Executive 

Order 13132 (64 FR 43255, August 10, 

1999); 

• Is not an economically significant 

regulatory action based on health or 

safety risks subject to Executive Order 

13045 (62 FR 19885, April 23, 1997); 


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Federal Register / Vol. 74, No. 151 / Friday, August 7, 2009 / Proposed Rules 39597 

• Is not a significant regulatory action 

subject to Executive Order 13211 (66 FR 

28355, May 22, 2001); 

• Is not subject to requirements of 

Section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (15 U.S.C. 272 note) because 

application of those requirements would 

be inconsistent with the CAA; and 

• Does not provide EPA with the 

discretionary authority to address, as 

appropriate, disproportionate human 

health or environmental effects, using 

practicable and legally permissible 

methods, under Executive Order 12898 

(59 FR 7629, February 16, 1994). 

In addition, this rule does not have 

Tribal implications as specified by 

Executive Order 13175 (65 FR 67249, 

November 9, 2000), because the SIP is 

not approved to apply in Indian country 

located in the State, and EPA notes that 

it will not impose substantial direct 

costs on Tribal governments or preempt 

Tribal law. 

List of Subjects 

40 CFR Part 52 

Environmental protection, Air 

pollution control, Electric utilities, 

Intergovernmental relations, Carbon 

monoxide, Nitrogen oxides, Ozone, 

Particulate matter, Reporting and 

recordkeeping requirements, Sulfur 

dioxide. 

40 CFR Part 96 

Environmental protection, Air 

pollution control, Electric utilities, 

Intergovernmental relations, Nitrogen 

oxides, Ozone, Particulate matter, 

Reporting and recordkeeping 

requirements, Sulfur dioxide. 

Authority: 42 U.S.C. 7401 et seq. 

Dated: July 29, 2009. 

Beverly H. Banister, 

Acting Regional Administrator, Region 4. 

[FR Doc. E9–18999 Filed 8–6–09; 8:45 am] 

BILLING CODE 6560–50–P 

DEPARTMENT OF DEFENSE 

GENERAL SERVICES 

ADMINISTRATION 

NATIONAL AERONAUTICS AND 

SPACE ADMINISTRATION 

48 CFR Part 25 

[FAR Case 2009–013; Docket 2009–0026; 

Sequence 1] 

RIN 9000–AL40 

Federal Acquisition Regulation; FAR 

Case 2009–013, Nonavailable Articles 

AGENCIES: Department of Defense (DoD), 

General Services Administration (GSA), 

and National Aeronautics and Space 

Administration (NASA). 

ACTION: Proposed rule. 

SUMMARY: The Civilian Agency 

Acquisition Council and the Defense 

Acquisition Regulations Council 

(Councils) are proposing to amend the 

Federal Acquisition Regulation (FAR) to 

revise the list of nonavailable articles at 

FAR 25.104(a). The Councils also 

request public comment as to whether 

some articles on the list of nonavailable 

articles are now mined, produced, or 

manufactured in the United States in 

sufficient and reasonably available 

commercial quantities and of a 

satisfactory quality and should therefore 

be removed from the list. 

DATES: Interested parties should submit 

written comments to the Regulatory 

Secretariat on or before October 6, 2009 

to be considered in the formulation of 

a final rule. 

ADDRESSES: Submit comments 

identified by FAR case 2009–013 by any 

of the following methods: 

• Regulations.gov: http:// 

www.regulations.gov. Submit comments 

via the Federal eRulemaking portal by 

inputting ‘‘FAR case 2009–013’’ under 

the heading ‘‘Comment or Submission’’. 

Select the link ‘‘Send a Comment or 

Submission’’ that corresponds with FAR 

Case FAR case 2009–013. Follow the 

instructions provided to complete the 

‘‘Public Comment and Submission 

Form’’. Please include your name, 

company name (if any), and ‘‘FAR case 

2009–013’’ on your attached document. 

• Fax: 202–501–4067. 

• Mail: General Services 

Administration, Regulatory Secretariat 

(VPR), 1800 F Street, NW., Room 4041, 

ATTN: Hada Flowers, Washington, DC 

20405. 

Instructions: Please submit comments 

only and cite FAR case FAR case 2009– 

013 in all correspondence related to this 

case. All comments received will be 

posted without change to http:// 

www.regulations.gov, including any 

personal and/or business confidential 

information provided. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Meredith Murphy, Procurement 

Analyst, at (202) 208–6925 for 

clarification of content. For information 

pertaining to status or publication 

schedules, contact the Regulatory 

Secretariat at (202) 501–4755. Please 

cite FAR case FAR case 2009–013. 

SUPPLEMENTARY INFORMATION: 

A. Background 

The Buy American Act does not apply 

with respect to articles, materials, or 

supplies if articles, materials, or 

supplies of the class or kind to be 

acquired, either as end items or 

components, are not mined, produced, 

or manufactured in the United States in 

sufficient and reasonably available 

commercial quantities and of a 

satisfactory quality. 

A nonavailability determination has 

been made for the articles listed in FAR 

25.104(a). As stated at FAR 25.103, this 

determination does not necessarily 

mean that there is no domestic source 

for the listed items, but that domestic 

sources can only meet 50 percent or less 

of total U.S. Government and 

nongovernment demand. 

Before acquisition of an article on the 

list, the procuring agency is responsible 

for conducting market research 

appropriate to the circumstances, 

including seeking domestic sources. 

This applies to acquisition of an article 

as— 

(A) An end product; or 

(B) A significant component (valued 

at more than 50 percent of the value of 

all the components). 

The class determination for articles on 

the list does not apply if the contracting 

officer learns at any time before the time 

designated for receipt of bids in sealed 

bidding or final offers in negotiation 

that an article on the list is available 

domestically in sufficient and 

reasonably available commercial 

quantities of a satisfactory quality to 

meet the requirements of the 

solicitation. 

The head of the contracting activity 

may make an individual determination 

that an article, material, or supply is not 

mined, produced, or manufactured in 

the United States in sufficient and 

reasonably available commercial 

quantities of a satisfactory quality. If the 

contracting officer considers that the 

nonavailability of an article is likely to 

affect future acquisitions, the 

contracting officer may submit a copy of 

the determination and supporting 


pwalker on DSK8KYBLC1PROD with PROPOSALS