[Federal Register Volume 65, Number 3 (Wednesday, January 5, 2000)]
[Proposed Rules]
[Pages 421-425]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-151]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[Region 2 Docket No. NY35-1-200, FRL-6518-5]


Approval and Promulgation of Implementation Plans; Reasonably 
Available Control Technology for Oxides of Nitrogen for the State of 
New York

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The EPA proposes approval of revisions to the New York State 
Implementation Plan (SIP) for ozone. The State submitted this portion 
of the implementation plan to satisfy Clean Air Act (the Act) 
requirements for adoption of rules for the application of reasonably 
available control technology (RACT) for oxides of nitrogen 
(NO<INF>X</INF>) in the entire State. The intended affect of this SIP 
revision is to reduce emissions of NO<INF>X</INF> in order to help 
attain the national ambient air quality standard for ozone.

DATES: Written comments must be received on or before February 4, 2000.

ADDRESSES: All comments should be addressed to:
    Raymond Werner, Acting Chief, Air Programs Branch, Environmental 
Protection Agency, Region II Office, 290 Broadway, 25th Floor, New 
York, New York 10007-1866.
    Copies of the State submittal and other information are available 
at the following addresses for inspection during normal business hours:
    Environmental Protection Agency, Region II Office, Air Programs 
Branch, 290 Broadway, 25th Floor, New York, New York 10007-1866.
    New York State Department of Environmental Conservation, Division 
of Air Resources, 50 Wolf Road, Albany, New York 12233.

FOR FURTHER INFORMATION CONTACT: Ted Gardella, Air Programs Branch, 
Environmental Protection Agency, 290 Broadway, 25th Floor, New York, 
New York 10007-1866, (212) 637-4249.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. What action is EPA proposing today?
II. Why is EPA proposing approval of New York's SIP revisions?
III. What are EPA's requirements for NO<INF>X</INF> RACT?
IV. What do New York's SIP revisions contain?
    A. SIP revision dated January 20, 1994
    B. SIP revision dated April 29, 1999
V. What sources does New York's NO<INF>X</INF> RACT regulation 
affect?
VI. What exemptions does New York's regulation allow?
VII. Were there any approvability issues with New York's 
NO<INF>X</INF> RACT regulation and, if so, how were they resolved?
    A. Case-by-Case RACT Determinations
    B. Certain Permitting Situation
    C. Repowering Compliance Option
VIII. What are EPA's conclusions?
IX. Administrative requirements

I. What Action Is EPA Proposing Today?

    EPA proposes approval of New York's revisions to the State 
Implementation Plan (SIP) which New York submitted to EPA on January 
20, 1994 and April 29, 1999. The January 20, 1994 submittal includes 
New York's Subpart 227-2, entitled ``Reasonably Available Control 
Technology (RACT) for Oxides of Nitrogen (NO<INF>X</INF>),'' for 
statewide implementation of New York's NO<INF>X</INF> RACT 
requirements, as well as revisions to Part 200, entitled ``General 
Provisions,'' Part 201, entitled ``Permits and Certificates,'' and 
Subpart 227-1, entitled ``Stationary Combustion Sources.'' The April 
29, 1999 submittal includes amendments to Subpart 227-2. EPA proposed 
action on other portions (Part 200, Subpart 227-1 and Subpart 227-3) of 
the April 29, 1999 submittal in a Federal Register notice published on 
October 14, 1999.

II. Why Is EPA Proposing Approval of New York's SIP Revisions?

    EPA has evaluated the SIP revisions that New York submitted for 
consistency with the Clean Air Act (the Act), EPA guidelines and EPA 
policy. EPA has determined that New York's SIP revisions dated January 
20, 1994 and April 29, 1999 meet all requirements and, therefore, EPA 
proposes approval of New York's SIP revisions to implement and enforce 
NO<INF>X</INF> RACT requirements statewide.

III. What Are EPA's Requirements for NO<INF>X</INF> RACT?

    The air quality planning requirements for the reduction of 
NO<INF>X</INF> emissions through RACT are set out in section 182(f) of 
the Act. EPA describes the section 182(f) requirements in a

[[Page 422]]

document, ``State Implementation Plans; Nitrogen Oxides Supplement to 
the General Preamble; Clean Air Act Amendments of 1990 Implementation 
of Title I; Proposed Rule,'' published November 25, 1992 (57 FR 55620). 
Refer to the November 25, 1992 document for detailed information on the 
NO<INF>X</INF> requirements. Also refer to additional guidance 
memoranda that EPA released subsequent to the NO<INF>X</INF> 
Supplement. The additional guidance includes: EPA publication EPA-452/
R-96-005 (March 1996) entitled ``NO<INF>X</INF> Policy Documents for 
The Clean Air Act of 1990''; EPA's policy memorandum on the approval 
options for generic RACT rules submitted by States (November 1996); 
EPA's draft system-wide averaging trading guidance (December 1993); 
EPA's publications of ``Alternative Control Technique Documents'' which 
are technical documents identifying alternative controls for most 
categories of stationary sources of NO<INF>X</INF>; and other related 
EPA policy and guidance documents.
    The EPA has defined RACT as the lowest emission limitation that a 
particular source is capable of meeting by the application of control 
technology that is reasonably available considering technological and 
economic feasibility (44 FR 53762, September 17, 1979).
    The Act requires that states include requirements, where 
practicable, for major stationary sources to include NO<INF>X</INF> 
RACT controls by May 31, 1995. Section 182(f) of the Act requires 
statewide application of the NO<INF>X</INF> RACT requirements.

IV. What Do New York's SIP Revisions Contain?

    The technical support document, located in the official file, 
includes a full description and detailed discussion of New York's SIP 
submittals and revisions. The technical support document for this 
proposed action is available from the EPA contact listed above in the 
ADDRESSES section. The following is a summary of New York's submittals.

A. SIP Revision Dated January 20, 1994

    New York held public hearings in April 1993 on its NO<INF>X</INF> 
RACT plan. Following the public hearings and the comment period, New 
York adopted the plan on January 19, 1994. On January 20, 1994, New 
York submitted the plan to EPA as a revision to the SIP. EPA reviewed 
the plan to determine completeness in accordance with criteria set out 
at 40 CFR part 51. On April 15, 1994, EPA found the submittal to be 
administratively and technically complete. New York's January 20, 1994 
SIP revision contains the following:
    1. Subpart 227-2, New York's NO<INF>X</INF> RACT regulation, as the 
enforceable mechanism which includes: a list of the affected sources; 
definitions; compliance plan requirements; control requirements 
including emission limits; compliance options for fuel switching, 
system-wide averaging, alternative RACT, and repowering; testing, 
monitoring, and reporting requirements;
    2. State rule Part 200 which was amended to add new definitions and 
emission testing requirements;
    3. State rule Part 201 which revises exemptions for certain sources 
so that those units which have the potential to be a major stationary 
source of NO<INF>X</INF> are no longer categorically exempted from 
permit and certificate requirements;
    4. State rule Subpart 227-1 which contains administrative 
revisions;
    5. Records from the Public Hearings; and
    6. The State's response to public comments.

B. SIP Revision Dated April 29, 1999

    The State proposed the April 29, 1999 SIP revision on September 16, 
1998, requested public comments by November 9, 1998 and held public 
hearings on the revision in November 1998. New York adopted the new and 
amended rules on January 12, 1999 and submitted the SIP revision to EPA 
on April 29, 1999. EPA determined the submittal administratively and 
technically complete on June 18, 1999. New York's SIP revision dated 
April 29, 1999 contains the following:
    1. Amended Subpart 227-2. The Subpart 227-2 revisions include: 
Removal of provisions which are no longer applicable; requirements for 
submission of a new RACT compliance plan for sources subject to Subpart 
227-3 (New York's NO<INF>X</INF> emissions budget and allowance 
program); additional wording which clarifies New York's approval of low 
NO<INF>X</INF> burners for mid-size boilers; corrections in the 
monitoring provisions to require heat input weighted averaging instead 
of arithmetic averaging; and requirements that New York submit 
individual RACT determinations to EPA as SIP revisions.
    2. New Subpart 227-3 and amendments to Part 200 and Subpart 227-1. 
EPA has proposed approval of these three rules as published in a 
Federal Register document on October 14, 1999 (see 64 FR 55667).
    3. Records from the Public Hearings;
    4. The State's response to public comments.

V. What Sources Does New York's NO<INF>X</INF> RACT Regulation 
Affect?

    In each SIP revision, New York's Subpart 227-2 specifies that 
existing major stationary sources must apply RACT to control 
NO<INF>X</INF> emissions. New York defines major stationary sources as 
facilities with the potential to emit 25 tons per year NO<INF>X</INF> 
in the severe nonattainment area--the New York City metropolitan area 
and the lower Orange County metropolitan area--and 100 tons per year in 
the remainder of the State. The New York City metropolitan area 
includes the five counties of New York City and the counties of Nassau, 
Suffolk, Westchester and Rockland. The lower Orange County metropolitan 
area includes the towns of Blooming Grove, Chester, Highlands, Monroe, 
Tuxedo, Warwick, and Woodbury. New York identifies these major source 
categories as follows: very large boilers, large boilers, mid-size 
boilers, small boilers, combustion turbines, internal combustion 
engines and other combustion sources. Subpart 227-2 provides a 
definition of each source category. These provisions are consistent 
with the Act and EPA guidance.

VI. What Exemptions Does New York's Regulation Allow?

    Subpart 227-2 contains provisions allowing equipment and source 
operations the following four exemptions:
    1. Section 227-2.1 allows for exemptions if EPA determines by May 
15, 1994 that NO<INF>X</INF> reductions would have no benefit to the 
net ozone air quality. New York provides that source owners, as well as 
the State, may petition the EPA for an exemption. This provision 
conforms to section 182(f) of the Act. In its April 1999 submittal, New 
York deleted this exemption because the May 1994 deadline is past. This 
deletion however, does not prevent source owners from petitioning EPA 
directly, at any time, since section 182(f) of the Act allows for such 
petitions.
    2. Section 227-2.3(a)(3) allows an exemption from the requirements 
of Subpart 227-2 to sources that provided New York with a schedule to 
cease operation by May 31, 1995. This provision is acceptable to EPA 
since the Act requires compliance by that date.
    3. Section 227-2.4(f)(3) allows an exemption to emergency power 
generating units and other units that operate during emergency 
situations less than 500 hours per year. This provision is consistent 
with EPA guidelines and it also limits the number of operating hours of 
exempted units.

[[Page 423]]

    4. Section 227-2.4(g) exempts owners from submitting a RACT 
determination for combustion installations with NO<INF>X</INF> 
emissions at a de minimis level. This exemption is consistent with the 
Act since New York's de minimis level of emissions are well below the 
25 tons per year major threshold limit.

VII. Were There Any Approvability Issues With New York's 
NO<INF>X</INF> RACT Regulation and, if So, How Were They Resolved?

    The following three approvability issues relate to Subpart 227-2 as 
submitted to EPA on January 20, 1994. There are no approvability issues 
with the amendments to Subpart 227-2 which New York submitted on April 
29, 1999. EPA has determined that the revision has resolved all issues 
related to the approval of Subpart 227-2.

A. Case-by-Case RACT Determinations

    Provisions within Subpart 227-2 establish a procedure for a case-
by-case determination of what represents RACT for an item of equipment 
or source operation. This procedure is applicable if the major 
NO<INF>X</INF> facility contains any source operation or item of 
equipment of a category not specifically regulated in Subpart 227-2. 
Case-by-case RACT determinations are contained in several sections of 
Subpart 227-2 as follows: 227-2.4(a)(2), 227-2.4(b)(2), 227-
2.4(c)(1)(iii), 227-2.4(c)(1)(iv), 227-2.4(e)(3), and 227-2.4(g). EPA 
refers to these case-by-case provisions as generic RACT provisions.
    Subpart 227-2 requires that the owners and/or operators of an 
affected facility submit a RACT proposal if they are not covered by 
specific emission limitations. The New York RACT proposal requires that 
owners/operators include a technical and economic feasibility analysis 
of the possible alternative control measures. Subpart 227-2 provides 
for New York to establish emission limits using a RACT determination 
specific to the facility.
    In addressing the approvability of New York's NO<INF>X</INF> RACT 
generic provisions, EPA had the following two concerns with New York's 
January 1994 submittal: (1) Subpart 227-2 did not require that the 
State submit approved case-by-case RACT determinations as SIP revisions 
for EPA approval, and (2) the State did not document the magnitude of 
NO<INF>X</INF> emissions associated with the generic provisions and 
whether they were significant or not. New York needed to address both 
these concerns in order for EPA to propose full approval of generic 
provisions, instead of conditional approval.
    Regarding EPA's first approvability concern, section 110 of the Act 
requires that a state adopt and submit, as SIP revisions after public 
notice and the opportunity for public comment, enforceable emission 
limitations and other control measures and techniques. Although 
NO<INF>X</INF> RACT limitations and requirements that are included in a 
permit are federally enforceable, under section 110 case-by-case RACT 
determinations would not be federally approvable unless Subpart 227-2 
required that such RACT determinations be submitted as SIP revisions 
for EPA approval. New York satisfied section 110 of the Act when, in 
its April 1999 SIP revision, New York amended Subpart 227-2 by adding 
section 227-2.5(e), a new compliance option, that requires the 
submittal of State approved case-by-case RACT determinations to EPA for 
approval as SIP revisions. Although section 227-2.5(e) refers to all 
but one of the State's case-by-case RACT determinations, New York has 
indicated that this omission was a mistake and that it intends to 
include reference to section 227-2.4(c)(1)(iii), the generic provision 
for mid-size boilers that use alternative fuels, in its new amendments 
to Subpart 227-2 which it anticipates will be proposed in its next SIP 
revision in the fall of 1999. New York's amended April 1999 SIP 
revision satisfies EPA's approvability concern with the State's January 
1994 submittal.
    EPA's second concern relates to whether EPA can approve Subpart 
227-2's generic provisions. Generic provisions are those portions of a 
regulation which require the application of RACT to an emission point, 
but the degree of control is not specified in the rule and is to be 
determined on a case-by-case basis taking technological and economic 
factors into consideration. On November 7, 1996, EPA issued a policy 
memorandum providing additional guidance for approving regulations 
which contain these ``generic provisions.'' (Sally Shaver memorandum to 
EPA Division Directors, ``Approval Options for Generic RACT Rules 
Submitted to Meet the non-CTG VOC RACT Requirement and Certain 
NO<INF>X</INF> RACT Requirements'').
    EPA policy allows for the full approval of state generic RACT rules 
prior to EPA approval of all major source RACT determinations provided 
an analysis is completed that concludes that the remaining source RACT 
determinations involve a de minimis level of NO<INF>X</INF> emissions. 
Such an approval does not exempt the remaining sources from RACT; 
rather it is a de minimis deferral of the approval of these case-by-
case RACT limits. In a letter dated April 27, 1999, New York provided 
sufficient data for EPA to evaluate the de minimis level of 
NO<INF>X</INF> emissions from generic sources in the State. Given the 
State's data, EPA has determined that four percent of the 
NO<INF>X</INF> emissions subject to RACT controls have either not yet 
been submitted to EPA as SIP revisions or, if submitted, have not yet 
been approved by EPA.<SUP>1</SUP> EPA has determined this amount to be 
de minimis. The four percent de minimis level includes sixteen 
facilities which New York is required to submit as single source SIP 
revisions of which seven have been submitted to EPA for approval as SIP 
revisions. Therefore, EPA has determined that New York's NO<INF>X</INF> 
RACT regulation conforms with EPA's policy regarding the approval of 
generic RACT provisions or rules, thereby allowing EPA to propose 
approval of Subpart 227-2. Section 227-2.5(e) requires New York to 
submit the remaining case-by-case RACT determinations to EPA for 
approval as SIP revisions.
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    \1\ EPA guidance provides that where the non-approved RACT 
requirements concern sources whose emissions represent less than 5% 
of the 1990 stationary source NO<INF>X</INF> inventory, excluding 
utility boilers, it may be appropriate to issue a full approval of 
the generic RACT regulation.
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B. Certain Permitting Situation

    The last sentence of section 227-2.3(a)(1) allows a facility with a 
valid certificate to operate or permit to construct, i.e. permits, to 
continue operating without implementing RACT until a new permit is 
issued that specifies the RACT requirements. Therefore, section 227-
2.3(a)(1) potentially allows affected sources to continue operation, 
under valid permits, without implementing RACT by May 31, 1995 which 
would be a violation of the Act.
    In its letter dated April 27, 1999, New York indicated that, to the 
best of their knowledge, every source subject to Subpart 227-2 has 
already received a permit. Furthermore, in the same letter, New York 
committed to include all emission limits and requirements of Subpart 
227-2 in all applicable permits within twelve months of EPA's final 
approval of Subpart 227-2.
    If EPA had acted on Subpart 227-2 soon after receiving the January 
1994 submittal, we would have proposed disapproval because section 227-
2.3(a)(1) would potentially allow some sources to operate in violation 
of the Act. However, since the State has confirmed in its recent letter 
that essentially all permits have been issued to all affected sources, 
a disapproval would have no practical effect at this

[[Page 424]]

time. Therefore, this issue is resolved to EPA's satisfaction.

C. Repowering Compliance Option

    Section 227-2.5(c) allows a facility to comply with Subpart 227-2 
by opting to repower. To do so, the owner/operator must, by December 
31, 1994, enter into a federally enforceable permit wherein it commits 
to permanently shut down and dismantle the boiler prior to May 15, 1999 
and wherein it commits to repower. This option also requires 
NO<INF>X</INF> emissions from the repowered unit to meet specific 
emission limits that are more stringent than the State's presumptive 
RACT limits.
    We have determined that the State's repowering compliance option 
does not fully satisfy EPA's guidance on repowering in that it does not 
require a milestone schedule for repowering nor does it require RACT 
measures during the interim period between May 31, 1995 and the date 
the facility is due to repower. These omissions are not acceptable to 
EPA. However, since the repowering option can no longer be applied, 
resolution of the discrepancies between EPA guidance and the State's 
regulation can have no practical effect because it's too late to 
enforce interim RACT or milestone scheduling requirements established 
by EPA guidance. The State has advised EPA that only one source in New 
York has opted to repower. The State's emission limitations for this 
option meets EPA requirements for repowering and will therefore be 
enforceable when EPA approves Subpart 227-2.

VIII. What Are EPA's Conclusions?

    EPA proposes approval of the two SIP revisions that implement New 
York's NO<INF>X</INF> RACT Program throughout the State, regardless of 
the nonattainment status. The first SIP revision, dated January 20, 
1994, includes Subpart 227-2, and revisions to Parts 200 and 201, and 
Subpart 227-1. The second SIP revision, dated April 29, 1999, includes 
amendments to Subparts 227-2.

IX. Administrative Requirements

Executive Order 12866

    The Office of Management and Budget (OMB) has exempted this 
regulatory action from Executive Order 12866, entitled ``Regulatory 
Planning and Review.''

Executive Order 13045

    Protection of Children from Environmental Health Risks and Safety 
Risks (62 FR 19885, April 23, 1997), applies to any rule that: (1) Is 
determined to be ``economically significant'' as defined under 
Executive Order 12866, and (2) concerns an environmental health or 
safety risk that EPA has reason to believe may have a disproportionate 
effect on children. If the regulatory action meets both criteria, the 
Agency must evaluate the environmental health or safety effects of the 
planned rule on children, and explain why the planned regulation is 
preferable to other potentially effective and reasonably feasible 
alternatives considered by the Agency.
    This rule is not subject to Executive Order 13045 because it does 
not involve decisions intended to mitigate environmental health or 
safety risks.

Executive Order 13084

    Under Executive Order 13084, EPA may not issue a regulation that is 
not required by statute, that significantly or uniquely affects the 
communities of Indian tribal governments, and that imposes substantial 
direct compliance costs on those communities, unless the Federal 
government provides the funds necessary to pay the direct compliance 
costs incurred by the tribal governments. If the mandate is unfunded, 
EPA must provide to the Office of Management and Budget, in a 
separately identified section of the preamble to the rule, a 
description of the extent of EPA's prior consultation with 
representatives of affected tribal governments, a summary of the nature 
of their concerns, and a statement supporting the need to issue the 
regulation. In addition, Executive Order 13084 requires EPA to develop 
an effective process permitting elected officials and other 
representatives of Indian tribal governments ``to provide meaningful 
and timely input in the development of regulatory policies on matters 
that significantly or uniquely affect their communities.''
    Today's rule does not significantly or uniquely affect the 
communities of Indian tribal governments. Accordingly, the requirements 
of section 3(b) of Executive Order 13084 do not apply to this rule.

Executive Order 13132

    Federalism (64 FR 43255, August 10, 1999) revokes and replaces 
Executive Orders 12612 (Federalism) and 12875 (Enhancing the 
Intergovernmental Partnership). Executive Order 13132 requires EPA to 
develop an accountable process to ensure ``meaningful and timely input 
by State and local officials in the development of regulatory policies 
that have federalism implications.'' ``Policies that have federalism 
implications'' is defined in the Executive Order to include regulations 
that have ``substantial direct effects on the States, on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.'' Under Executive Order 13132, EPA may not issue a 
regulation that has federalism implications, that imposes substantial 
direct compliance costs, and that is not required by statute, unless 
the Federal government provides the funds necessary to pay the direct 
compliance costs incurred by State and local governments, or EPA 
consults with State and local officials early in the process of 
developing the proposed regulation. EPA also may not issue a regulation 
that has federalism implications and that preempts State law unless the 
Agency consults with State and local officials early in the process of 
developing the proposed regulation.
    This proposed rule will not have substantial direct effects on the 
States, on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government, as specified in Executive Order 13132. 
Thus, the requirements of section 6 of the Executive Order do not apply 
to this rule.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to conduct a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements unless the agency certifies 
that the rule will not have a significant economic impact on a 
substantial number of small entities. Small entities include small 
businesses, small not-for-profit enterprises, and small governmental 
jurisdictions. This proposed rule will not have a significant impact on 
a substantial number of small entities because SIP approvals under 
section 110 and subchapter I, part D of the Clean Air Act do not create 
any new requirements but simply approve requirements that the State is 
already imposing. Therefore, because the Federal SIP approval does not 
create any new requirements, I certify that this action will not have a 
significant economic impact on a substantial number of small entities.
    Moreover, due to the nature of the Federal-State relationship under 
the Clean Air Act, preparation of flexibility analysis would constitute 
Federal inquiry into the economic reasonableness of state action. The 
Clean Air Act forbids EPA to base its actions concerning SIPs on such 
grounds. Union Electric Co. v. U.S. EPA,

[[Page 425]]

427 U.S. 246, 255-66 (1976); 42 U.S.C. 7410(a)(2).

Unfunded Mandates

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA 
must prepare a budgetary impact statement to accompany any proposed or 
final rule that includes a federal mandate that may result in estimated 
annual costs to State, local, or tribal governments in the aggregate; 
or to private sector, of $100 million or more. Under section 205, EPA 
must select the most cost-effective and least burdensome alternative 
that achieves the objectives of the rule and is consistent with 
statutory requirements. Section 203 requires EPA to establish a plan 
for informing and advising any small governments that may be 
significantly or uniquely impacted by the rule.
    EPA has determined that the proposed approval action does not 
include a federal mandate that may result in estimated annual costs of 
$100 million or more to either State, local, or tribal governments in 
the aggregate, or to the private sector. This federal action approves 
pre-existing requirements under State or local law, and imposes no new 
requirements. Accordingly, no additional costs to State, local, or 
tribal governments, or to the private sector, result from this action.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Hydrocarbons, 
Intergovernmental relations, Nitrogen dioxide, Ozone, Reporting and 
recordkeeping requirements, Volatile organic compounds.

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

    Dated: December 21, 1999.
William J. Muszynski,
Acting Regional Administrator, Region 2.
[FR Doc. 00-151 Filed 1-4-00; 8:45 am]
BILLING CODE 6560-50-P