Friday, 

October 13, 2006 

Part II 

Environmental 

Protection Agency 

40 CFR Part 51 

Regional Haze Regulations; Revisions to 

Provisions Governing Alternative to 

Source-Specific Best Available Retrofit 

Technology (BART) Determinations; Final 

Rule 


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60612 Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 51 

[EPA–HQ–OAR–2002–0076; FRL–8230–4] 

RIN 2060–AN22 

Regional Haze Regulations; Revisions 

to Provisions Governing Alternative to 

Source-Specific Best Available Retrofit 

Technology (BART) Determinations 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Final rule. 

SUMMARY: The EPA promulgated 

regulations to address a type of visibility 

impairment known as regional haze in 

1999. These regulations have been 

judicially challenged twice. On May 24, 

2002, the U.S. Court of Appeals for the 

District of Columbia Circuit issued a 

ruling vacating the Regional Haze Rule 

in part and sustaining it in part, based 

on a finding that EPA’s prescribed 

methods for determining best available 

retrofit technology (BART) were 

inconsistent with the Clean Air Act 

(CAA). American Corn Growers Ass’n v. 

EPA, 291 F.3d 1 (DC Cir. 2002). We 

finalized a rule on July 6, 2005 

addressing the court’s ruling in this 

case. On February 18, 2005, the U.S. 

Court of Appeals for the District of 

Columbia Circuit issued another ruling, 

in Center for Energy and Economic 

Development v. EPA, 398 F.3d 653(DC 

Cir. 2005), granting a petition 

challenging provisions of the Regional 

Haze Rule governing an optional 

emissions trading program for certain 

western States and Tribes (the Western 

Regional Air Partnership (WRAP) 

Annex Rule). We published proposed 

regulations to revise the provisions of 

the Regional Haze Rule governing 

alternative trading programs, and to 

provide additional guidance on such 

programs in August 2005. We received 

several comments on the August 2005 

proposal. This final rule finalizes the 

proposed revisions, including changes 

in response to the public comments. 

DATES: This rule is effective December 

12, 2006. 

ADDRESSES: The EPA has established a 

docket for this action under Docket ID 

No. EPA–HQ–OAR–2002–0076. All 

documents in the docket are listed on 

the www.regulations.gov Web site. 

Although listed in the index, some 

information is not publicly available, 

i.e., confidential business information 

(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 through 

www.regulations.gov or in hard copy at 

the OAR Docket, EPA/DC, EPA West, 

Room B102, 1301 Constitution Ave., 

NW., Washington, DC. The Public 

Reading Room is open from 8:30 a.m. to 

4:30 p.m., Monday through Friday, 

excluding legal holidays. The telephone 

number for the Public Reading Room is 

(202) 566–1744, and the telephone 

number for the Air and Radiation 

Docket and Information Center is (202) 

566–1742. NOTE: The EPA Docket 

Center suffered damage due to flooding 

during the last week of June 2006. The 

Docket Center is continuing to operate. 

However, during the cleanup, there will 

be temporary changes to Docket Center 

telephone numbers, addresses, and 

hours of operation for people who wish 

to visit the Public Reading Room to 

view documents. Consult EPA’s Federal 

Register notice at 71 FR 38147 (July 5, 

2006) or the EPA Web site at 

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

current information on docket status, 

locations and telephone numbers. 

FOR FURTHER INFORMATION CONTACT: 

Kathy Kaufman, EPA, Air Quality 

Planning Division, Geographic 

Strategies Group, C504–02, 919–541– 

0102 or by e-mail at 

kaufman.kathy@epa.gov, or Todd 

Hawes, EPA, Air Quality Planning 

Division, Geographic Strategies Group, 

C504–02, 919–541–5591 or by e-mail at 

hawes.todd@epa.gov. 

SUPPLEMENTARY INFORMATION: 

Regulated Entities. This final rule will 

affect the following: State and local 

permitting authorities and Indian Tribes 

containing major stationary sources of 

pollution affecting visibility in 

federally-protected scenic areas. 

This list is not intended to be 

exhaustive, but rather provides a guide 

for readers regarding entities likely to be 

regulated by this action. This list gives 

examples of the types of entities EPA is 

now aware could potentially be 

regulated by this action. Other types of 

entities not listed could also be affected. 

To determine whether your facility, 

company, business, organization, etc., is 

regulated by this action, you should 

examine the applicability criteria in 

section II of this preamble. If you have 

any questions regarding the 

applicability of this action to a 

particular entity, consult the people 

listed in the preceding section. 

Outline. The contents of today’s 

preamble are listed in the following 

outline. 

I. Overview and Background 

II. Revisions to Regional Haze Rule 

§ 51.308(e)(2) Governing Alternatives to 

Source-by-Source BART 

A. Establishing a BART Benchmark and 

Demonstrating Greater Reasonable 

Progress Than BART 

B. Comments Relating to the Final 

Determination That CAIR Makes Greater 

Reasonable Progress Than BART in the 

July 6, 2005 BART Guidelines Rule 

C. Minimum Elements of Cap and Trade 

Programs 

III. Revisions to Regional Haze Rule § 51.309 

IV. Statutory and Executive Order Reviews 

A. Executive Order 12866: Regulatory 

Planning and Review 

B. Paperwork Reduction Act 

C. Regulatory Flexibility Act 

D. Unfunded Mandates Reform Act 

E. Executive Order 13132: Federalism 

F. Executive Order 13175: Consultation 

and Coordination With Indian Tribal 

Governments 

G. Executive Order 13045: Protection of 

Children From Environmental Health 

and Safety Risks 

H. Executive Order 13211: Actions That 

Significantly Affect Energy Supply, 

Distribution, or Use. 

I. National Technology Transfer 

Advancement Act 

J. Executive Order 12898: Federal Actions 

to Address Environmental Justice in 

Minority Populations and Low-Income 

Populations 

K. Congressional Review Act 

IV. Statutory Provisions and Legal Authority 

I. Overview and Background 

This rulemaking provides the 

following changes to the regional haze 

regulations: 

(1) Revised regulatory text in section 

51.308(e)(2)(i) in response to the Center 

for Energy and Economic Development 

(CEED) v. EPA court’s remand, to 

remove the requirement that the 

determination of the BART 

‘‘benchmark’’ be based on cumulative 

visibility analyses and to clarify the 

process for making such determinations; 

(2) New regulatory text in 

§ 51.308(e)(2)(vi), to provide minimum 

elements for cap and trade programs 

adopted in lieu of BART; and 

(3) Revised regulatory text in § 51.309, 

to reconcile the optional framework for 

certain western States and Tribes to 

implement the recommendations of the 

Grand Canyon Visibility Transport 

Commission (GCVTC) with the CEED v. 

EPA decision. 

How This Preamble Is Structured 

Section I provides background on the 

BART requirements of the CAA as 

codified in the Regional Haze Rule, on 

the decision in American Corn Growers 

in which the DC Circuit vacated and 

remanded parts of the rule addressing 

the BART requirements, on the June 

2005 BART rule, and on the EPA’s 

approval of the WRAP Annex and the 


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1See, e.g. CAA section 169(a)(1). 

2CAA sections 169A(b)(2) and (g)(7). 

3See 66 FR 35737–35743 for a discussion of the 

rationale for the BART requirements in the 1999 

Regional Haze Rule. 

subsequent litigation. Section II 

discusses specific issues relating to the 

revisions to § 51.308(e)(2) of the 

Regional Haze Rule governing 

alternatives to source-by-source BART. 

Section III discusses specific issues 

relating to the revisions to § 51.309 of 

the Regional Haze Rule pertaining to the 

optional emissions trading program for 

certain western States and Tribes. 

Section IV provides a discussion of how 

this rulemaking complies with the 

requirements of Statutory and Executive 

Order Reviews. 

The Regional Haze Rule and BART 

Guidelines 

In 1999, we published the Regional 

Haze Rule to address visibility 

impairment produced by a multitude of 

sources and activities which emit fine 

particles and their precursors and which 

are located across a broad geographic 

area (64 FR 35714). The Regional Haze 

Rule requires States to submit State 

implementation plans (SIPs) to address 

regional haze visibility impairment in 

156 federally-protected parks and 

wilderness areas, such as the Grand 

Canyon and Yosemite. These 156 scenic 

areas are called ‘‘mandatory Class I 

Federal areas’’ in the CAA 1 but are 

referred to simply as ‘‘Class I areas’’ in 

today’s rulemaking. The 1999 rule was 

issued to fulfill a long-standing EPA 

commitment to address regional haze 

under the authority and requirements of 

sections 169A and 169B of the CAA. 

As required by the CAA, we included 

in the final Regional Haze Rule a 

requirement for BART for certain large 

stationary sources that were put in place 

between 1962 and 1977. We discussed 

these requirements in detail in the 

preamble to the final rule (64 FR 35737–

35743). The regulatory requirements for 

BART were codified at section 51.308(e) 

and in definitions that appear in section 

51.301. 

In the preamble to the Regional Haze 

Rule, we committed to issuing further 

guidelines to clarify the requirements of 

the BART provision. These guidelines 

were issued on July 6, 2005 in a final 

rule entitled ‘‘Regional Haze 

Regulations and Guidelines for Best 

Available Retrofit Technology (BART) 

Determinations’ (‘‘the BART Rule’’) (70 

FR 39104). The purpose of the BART 

guidelines is to assist States as they 

identify which of their BART-eligible 

sources should undergo a BART 

analysis (i.e., which are ‘‘sources subject 

to BART’’) and select appropriate 

controls (‘‘the BART determination’’). 

We explained in the preamble to the 

1999 Regional Haze Rule that the BART 

requirements in section 169A(b)(2)(A) of 

the CAA demonstrate Congress’ intent 

to focus attention directly on the 

problem of pollution from a specific set 

of existing sources (64 FR 35737). The 

CAA requires that any of these existing 

sources ‘‘which, as determined by the 

State, emits any air pollutant which may 

reasonably be anticipated to cause or 

contribute to any impairment of 

visibility [in any Class I area],’’ shall 

install the best available retrofit 

technology for controlling emissions.2

In determining BART, the CAA requires 

the State to consider several factors that 

are set forth in section 169A(g)(2) of the 

CAA, including the degree of 

improvement in visibility which may 

reasonably result from the use of such 

technology. 

Because the problem of regional haze 

is caused in large part by the long-range 

transport of emissions from multiple 

sources, and for certain technical and 

other reasons explained in that 

rulemaking, we had adopted in the 1999 

rule an approach that required States to 

look at the contribution of all BART 

sources to the problem of regional haze 

in determining both applicability and 

the appropriate level of control for 

BART. Specifically, we had concluded 

that if a source potentially subject to 

BART is located in an area from which 

pollutants may be transported to a Class 

I area, that source ‘‘may reasonably be 

anticipated to cause or contribute’’ to 

visibility impairment in the Class I area. 

We had also concluded that in weighing 

the factors set forth in the statute for 

determining BART, the States should 

consider the collective impact of BART 

sources on visibility. In particular, in 

considering the degree of visibility 

improvement that could reasonably be 

anticipated to result from the use of 

such technology, we stated that the 

State should consider the degree of 

improvement in visibility that would 

result from the cumulative impact of 

applying controls to all sources subject 

to BART. We concluded that the States 

should use this analysis to determine 

the appropriate BART emission 

limitations for specific sources.3

The 1999 Regional Haze Rule also 

included provisions in section 51.309 

based on the strategies developed by the 

GCVTC. Certain western States and 

Tribes were eligible to submit 

implementation plans under section 

51.309 as an alternative method of 

achieving reasonable progress for those 

Class I areas covered by the GCVTC’s 

analysis—i.e., the 16 Class I areas on the 

Colorado Plateau. In order for States and 

Tribes to be able to utilize this section, 

however, the rule provided that EPA 

must receive an ‘‘Annex’’ to the 

GCVTC’s final recommendations. The 

purpose of the Annex was to provide 

the specific provisions needed to 

translate the GCVTC’s general 

recommendations for stationary source 

sulfur dioxide (SO2) reductions into an 

enforceable regulatory program. The 

rule provided that such an Annex, 

meeting certain requirements, be 

submitted to EPA no later than October 

1, 2000. See section 51.309(d)(4) and (f) 

(2000). 

American Corn Growers v. EPA 

In American Corn Growers, industry 

petitioners challenged EPA’s 

interpretation of the BART 

determination process and raised other 

challenges to the rule. The court in 

American Corn Growers concluded that 

the BART provisions in the 1999 

Regional Haze Rule were inconsistent 

with the provisions in the CAA ‘‘giving 

the states broad authority over BART 

determinations.’’ 291 F.3d at 8. 

Specifically, with respect to the test for 

determining whether a source is subject 

to BART, the court held that the method 

EPA had prescribed for determining 

which eligible sources are subject to 

BART illegally constrained the authority 

Congress had conferred on the States. 

Id. The court did not decide whether the 

general collective contribution approach 

to determining BART applicability was 

necessarily inconsistent with the CAA. 

Id. at 9. Rather, the court stated that 

‘‘[i]f the [Regional Haze Rule] contained 

some kind of a mechanism by which a state 

could exempt a BART-eligible source on the 

basis of an individualized contribution 

determination, then perhaps the plain 

meaning of the Act would not be violated. 

But the [Regional Haze Rule] contains no 

such mechanism.’’

Id. at 12. 

The court in American Corn Growers 

also found that our interpretation of the 

CAA requiring the States to consider the 

degree of improvement in visibility that 

would result from the cumulative 

impact of applying controls in 

determining BART was inconsistent 

with the language of the CAA. 291 F.3d 

at 8. Based on its review of the statute, 

the court concluded that the five 

statutory factors in section 169A(g)(2) 

‘‘were meant to be considered together 

by the states.’’ Id. at 6. 

The final rule promulgated on July 6, 

2005 responded to the American Corn 

Growers court’s decision on the BART 

provisions by amending the Regional 

Haze Rule at § 51.308 and by finalizing 


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60614 Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 

changes to the BART guidelines at part 

51, appendix Y (70 FR 39104). These 

changes eliminate the previous 

constraint on State discretion and 

provide States with appropriate 

techniques and methods for determining 

which BART-eligible sources ‘‘may 

reasonably be anticipated to cause or 

contribute to any impairment of 

visibility in any mandatory Class I 

Federal area.’’ In addition, the revised 

regulations list the visibility 

improvement factor with the other 

statutory BART determination factors in 

section 51.308(e)(1)(A), so that States 

will be required to consider all five 

factors, including visibility impacts, on 

an individual source basis when making 

each individual source BART 

determination, rather than considering 

the cumulative impacts of all BART 

sources on visibility (‘‘group BART’’). 

The Annex Rule 

In a rule dated June 5, 2003, EPA 

approved the WRAP’s Annex to the 

GCVTC report (68 FR 33764). In this 

action, referred to as the ‘‘Annex rule,’’

EPA approved the quantitative SO2

emission reduction milestones and the 

detailed provisions of the backstop 

market trading program developed by 

the WRAP as meeting the requirements 

of section 51.309(f), and therefore 

codified the Annex provisions in 

section 51.309(h). Subsequently, five 

States and one local agency submitted 

SIPs developed to comply with all of 

section 51.309, including the Annex 

provisions at section 51.309(h). In 

accordance with section 51.309(c) these 

SIPs were submitted prior to December 

31, 2003. 

Center for Energy and Economic 

Development v. EPA 

The EPA’s approval of the Annex rule 

was challenged by CEED on, among 

other grounds, that the CAA prohibits 

EPA from allowing States to adopt 

alternative measures, such as a trading 

program, in lieu of BART. The court, in 

CEED v. EPA, affirmed our 

interpretation of section 169A(b)(2) of 

the CAA as allowing for alternatives to 

BART where those alternatives are 

demonstrated to make greater progress 

than BART. CEED v. EPA, 398 F.3d at 

659–660. The court, however, took issue 

with the methodology that EPA had 

required the States to use in that 

demonstration, pursuant to certain 

provisions of the Regional Haze Rule. 

As noted above, § 51.308(e)(2) of the 

1999 Regional Haze Rule required that 

visibility improvements under sourcespecific BART—the benchmark for 

comparison to the alternative program—

must be estimated based on the 

application of BART controls to all 

sources subject to BART. This section 

was incorporated into the WRAP Annex 

rule by reference at § 51.309(f). The 

court held that EPA could not require 

this type of ‘‘group BART’’ approach, 

which was vacated in American Corn 

Growers in a source-specific BART 

context, even in an alternative trading 

program in which State participation 

was wholly optional. 

The BART guidelines as proposed in 

May 2004 contained a section offering 

guidance to States choosing to address 

their BART-eligible sources under the 

alternative strategy provided for in 

§ 51.308(e)(2). This guidance included a 

broad overview of the steps in 

developing an emissions trading 

program and criteria for demonstrating 

that such a trading program would 

achieve greater progress towards 

eliminating visibility impairment than 

would BART. In light of the D.C. 

Circuit’s decision in CEED v. EPA in 

2005, we did not include the overview 

of emissions trading programs in the 

final BART guidelines. We did note, 

however, that our authority to address 

BART through alternative means was 

upheld in CEED v. EPA and that we 

remained committed to providing States 

with that flexibility. Today’s revisions 

to the Regional Haze Rule, which 

responds to the holding in CEED v. EPA, 

provide the flexibility that States need 

to implement alternatives to BART. 

Overview of Changes to §§ 51.308(e)(2) 

and 51.309 of the Regional Haze Rule 

The EPA continues to support State 

efforts to develop trading programs and 

other alternative strategies to fulfill the 

goals of the CAA. We believe such 

strategies have the potential to achieve 

greater progress towards the national 

visibility goals than more traditional 

approaches to regulation, and to do so 

in the most cost-effective manner 

practicable. In August 2005, we 

proposed amendments to the Regional 

Haze Rule to enable States to continue 

to develop and implement such 

programs (70 FR 44154, August 1, 2005). 

Today’s rule finalizes these 

amendments, including changes in 

response to comments on the proposal. 

First, we are amending the generally 

applicable provisions at § 51.308(e)(2), 

which prescribe the type of analysis 

used to determine emissions reductions 

achievable from source-by-source 

BART, for purposes of comparing to the 

alternative program. These amendments 

reconcile the methodology for 

determining whether an alternative 

program is approvable with the court’s 

decision in CEED v. EPA. Today’s rule 

also establishes the minimum elements 

of an acceptable cap and trade program 

and provides for consistent application 

of the BART guidelines for electric 

generating units (EGUs) between sourceby-source programs and alternative cap 

and trade programs. 

Second, we are amending section 

51.309 to enable certain western States 

and Tribes to continue to utilize the 

strategies contained in the GCVTC 

report as an optional means to satisfy 

reasonable progress requirements for 

certain Class I areas, for the first longterm planning period. These changes 

provide States and Tribes with an 

opportunity to revise and resubmit the 

backstop SO2 emissions trading program 

absent any requirement to assess 

visibility on a cumulative basis when 

determining the emissions reductions 

achievable by source-by-source BART. 

II. Revisions to Regional Haze Rule 

§ 51.308(e)(2) Governing Alternatives to 

Source-by-Source BART 

In this section of the preamble, we 

discuss changes or clarifications to the 

provisions proposed in August, 2005. 

Where relevant, we also respond to 

significant comments received during 

the comment periods on our earlier 

BART proposals. For each provision 

that we are changing or clarifying, 

where relevant, we provide discussion 

of comments received on the 

proposal(s), changes or clarifications we 

are finalizing, and the reasons for these 

changes or clarifications. 

A. Establishing a BART Benchmark and 

Demonstrating Greater Reasonable 

Progress Than BART 

The Regional Haze Rule provides 

States with the authority to implement 

an emissions trading program or other 

alternative measures in lieu of meeting 

the requirements for source-by-source 

BART. Under this provision of the 

Regional Haze Rule, States have the 

flexibility to design programs to reduce 

emissions from stationary sources in a 

more cost-effective manner so long as 

they can demonstrate that the 

alternative approach will achieve 

greater reasonable progress towards 

improving visibility than would have 

been achieved by implementation of the 

BART requirements. 

As described in the preamble to the 

August proposal, the 1999 Regional 

Haze Rule had specified a methodology 

for comparing an alternative trading or 

other type program against source-bysource BART. These regulations were 

challenged following a rulemaking by 

EPA to revise the Regional Haze Rule to 

incorporate an optional emissions 

trading program for certain Western 

States and Tribes (the Annex rule). The 


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4We are also clarifying an unintended ambiguity 

in the regulatory provisions pertaining to BART 

determinations under 51.308(e)(1). Specifically, as 

discussed in the preamble to the BART Rule, 

consistent with our proposal in 2004, we revised 

the regional haze regulations to allow States to 

‘‘exclude from the BART determination process 

potential emissions from a source of less than forty 

tons per year for SO2 or NOX, or 15 tons per year 

for PM10.’’ 70 FR at 39117 (emphasis added). The 

regulatory text at 51.308(e)(1)(ii)(C), however, did 

not clearly state that the de minimis level for PM10

should be based on a source’s potential to emit. In 

this rulemaking we are clarifying that States are not 

required to determine BART for BART-eligible 

sources with a potential to emit less than 15 tons 

per year of PM10. 

court in CEED v. EPA, granted 

petitioner’s challenge to the Annex rule 

because EPA’s regional haze regulations 

had required the States submitting the 

Annex to consider ‘‘the impact of all 

emissions reductions to estimate 

visibility progress’’ in establishing a 

BART benchmark against which to 

compare their BART alternative 

program. In the August proposal, we 

proposed to revise the method for 

comparing an alternative trading or 

other type program against source-bysource BART. Specifically, we proposed 

to amend the regional haze regulations 

to provide that States estimate the 

emission reductions that could be 

achieved by BART in the same manner 

as in making source-by-source BART 

determinations. 

Today’s final rule revises section 

51.308(e)(2) to make clear that the 

emissions reductions that could be 

achieved through implementation of the 

BART provisions at section 51.308(e)(1) 

serve as the benchmark against which 

States can compare an alternative 

program. In short, to demonstrate that a 

trading program or other alternative 

program makes greater reasonable 

progress than BART, the State can 

develop an estimate of BART emissions 

reductions using the same approach that 

it would use to establish source-bysource BART emissions limitations 

under the BART guidelines. As 

discussed in more detail below, today’s 

rule also makes clear that where a 

trading program or other similar 

alternative program has been designed 

primarily to meet a Federal or State 

requirement other than BART, the State 

can use a more simplified approach to 

demonstrating that the alternative 

program will make greater reasonable 

progress than BART. Such an approach 

may be appropriate where the State 

believes the alternative program is 

clearly superior to BART and a detailed 

BART analysis is not necessary to assure 

that the alternative program will result 

in greater reasonable progress than 

BART. 

Framework for Demonstrating That an 

Alternative Program Provides for 

Greater Reasonable Progress 

The development of a BART 

benchmark using the approach for 

source-by-source BART determinations 

will require States to identify those 

existing sources which are BARTeligible, to determine which of those 

sources are subject to BART, and to then 

determine the level of control that 

would be BART for these sources. Once 

the State has established a BART 

benchmark, it can then compare the 

benchmark against the alternative 

program it has developed. This 

approach could entail separate visibility 

analyses in as many as three distinct 

stages: (1) Determining which BARTeligible sources are subject to BART; (2) 

determining what BART is for each 

source subject to BART; and (3) 

determining the overall visibility 

improvement anticipated from the 

application of BART to all sources 

subject to BART. The following sections 

discuss the comments received on the 

visibility analyses in the first two steps, 

as well as comments on additional 

issues for determining which sources 

are subject to BART and the 

determination of BART for such 

sources. 

Sources Subject to BART 

Proposal. In the proposal, we noted 

that the BART guidelines finalized on 

July 6, 2005 provide States with 

guidance on how to determine which 

BART-eligible sources are reasonably 

anticipated to cause or contribute to 

visibility. The Guidelines explain that 

States may consider all BART-eligible 

sources to meet this threshold and 

therefore subject all these sources to 

review, or, alternatively, that States may 

determine which BART-eligible sources 

are subject to BART using the methods 

for modeling source specific impacts on 

visibility discussed in the guidance. We 

noted that by considering all BARTeligible sources to be subject to BART in 

the context of setting the BART 

benchmark, States could ease their 

administrative burden and maximize 

the number of BART-eligible sources 

included in the benchmark analysis. 

Where a State takes this approach, the 

opportunity for assessing source-bysource visibility impact would still 

remain at the next step of setting the 

benchmark—the BART determination 

analysis. 

Comments. Several commenters 

stated that allowing States to consider 

all BART-eligible sources to be ‘‘subject 

to BART’’ (i.e., subject to a BART 

determination analysis) is contrary to 

the CAA as interpreted by the D.C. 

Circuit in American Corn Growers. Two 

commenters have indicated that they 

plan to challenge this provision of the 

BART guidelines in a petition for review 

before the D.C. Circuit and are opposed 

to it in the context of BART alternative 

programs as well. One of these 

commenters also stated that it is unclear 

from the preamble discussion where in 

the proposed revisions to the 

regulations this option is authorized. 

Final Rule. We are reiterating here, as 

we pointed out in the proposal, that the 

language in section 169A(b)(2) of the 

CAA establishing the threshold for 

BART review provides a State with the 

discretion to consider all BART-eligible 

sources to be subject to BART and to 

make BART determinations for all its 

BART-eligible sources. In other words, 

as noted in the BART guidelines, once 

a State has identified its BART-eligible 

sources, it must decide whether (1) to 

make BART determinations for all of 

them, or (2) to consider exempting some 

of them from BART because they may 

not reasonably be anticipated to cause 

or contribute to any visibility 

impairment in any Class I area. As 

explained in the 1999 Regional Haze 

Rule, given the nature of regional haze, 

it would be reasonable for a State to 

determine that where the State as a 

whole contributes to visibility 

impairment at a Class I area, any large 

stationary source in the State that emits 

SO2 or other visibility-impairing 

pollutants would emit air pollutants 

that would ‘‘reasonably be anticipated 

to cause or contribute to any 

impairment of visibility in [any Class I 

area].’’ CAA Section 169A(b)(2). 

This approach is authorized by the 

regulations through the cross reference 

to § 51.308(e)(1) in § 51.308(e)(2). By 

providing that the BART-benchmark 

should be established by conducting 

BART determinations in accordance 

with § 51.308(e)(1), we provide the State 

with the same options as are available 

in those provisions for determining 

source-by-source BART. In the context 

of subject-to-BART determinations, this 

includes either considering all BARTeligible sources to be subject to BART 

or, using the methods described in the 

BART guidelines or other reasonable 

approaches, to exempt sources which 

the State determines are not reasonably 

anticipated to cause or contribute to any 

visibility impairment.4

The BART Determination 

Proposal. The CAA identifies five 

factors that States are to consider in 

making BART determinations. One of 

these factors is ‘‘the degree of 

improvement in visibility which may 

reasonably be anticipated to result from 


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the use of [BART].’’ Today’s rulemaking, 

in large part, is focused on how States 

should handle consideration of this 

factor in establishing a BART 

benchmark. 

In the proposal, we stated that one 

way to handle the visibility 

improvement element of the BART 

determination for all BART sources 

covered by the program would be to 

conduct individualized assessments of 

the visibility improvement expected 

from each BART source under various 

control scenarios, as described in the 

BART guidelines. We noted that such an 

approach could impose significant 

resource burdens on the States and 

solicited recommendations on more 

streamlined approaches for estimating 

BART sources’ individual impacts that 

might be appropriate in the context of 

assessing alternative programs. One area 

of consideration that we identified is the 

type of model used. We requested 

comment on whether regional scale 

models might be used to consolidate 

individual source impact analyses into 

one or a few model runs, and whether 

this would significantly ease the burden 

on States. 

In the proposal, we also made clear 

our belief that in determining whether 

an alternative program provides for 

greater reasonable progress than would 

source-by-source BART, States have the 

discretion to employ a cumulative 

visibility analysis for purposes of 

estimating the potential visibility 

impacts of BART. Based on our analysis 

of American Corn Growers and CEED, 

we stated that although EPA may not 

require States to use a cumulative 

visibility approach to estimating the 

improvement achievable from BART, 

States are not barred from using such an 

approach if they so choose. 

Finally, in the proposal preamble, we 

discussed the situation where emissions 

reductions at BART-eligible sources are 

required by CAA requirements other 

than BART (or to fulfill requirements of 

a State law or regulation not required by 

the CAA). We noted that in such cases, 

a State may wish to evaluate whether 

the emissions reductions from the 

program would result in greater 

reasonable progress towards the 

national visibility goal than would the 

installation of BART. We noted that 

EPA had made such a determination 

with respect to the Clean Air Interstate 

Rule (CAIR) for EGUs in States which 

participate in the CAIR cap and trade 

program. 

We noted that such a situation affects 

the type of analysis that is permissible 

to show that the alternative program 

makes greater reasonable progress than 

BART. Specifically, where a 

requirement other than BART 

determines the level of emissions 

reductions required from BART-eligible 

sources (along with other sources), a 

most-stringent case BART may be used 

as the BART benchmark. (This moststringent case BART is essentially a 

form of ‘‘group BART,’’ because is 

assumes that every BART-eligible 

source will apply controls). The reason 

for this is that if it is shown that 

implementation of another requirement 

results in greater progress than would 

the most stringent BART for all the 

BART-eligible sources, then it can safely 

be said that this most-stringent-BART 

benchmark is not the determinative 

factor in establishing the emission 

reductions requirement. Therefore, there 

can be no concern that the group-BART 

analysis would lead States to adopt an 

unduly stringent alternative approach. 

(1) Types of Models 

Comments. The comments submitted 

supported EPA’s proposal that States 

could use the approach in the 

Guidelines in making individualized 

visibility assessments for BART 

determinations. In response to our 

request for recommendations for more 

streamlined approaches to assessing 

source specific visibility impacts, we 

received several comments supporting 

regulations that would allow for this. 

One commenter pointed out that 

streamlined approaches, such as the use 

of photochemical grid models, would 

significantly ease the burden on States 

and Tribes. The commenter also pointed 

out that § 51.308(e)(1), cross-referenced 

as the guiding provision for BART 

determinations in proposed 

§ 51.308(e)(2)(i)(C), does not explicitly 

recognize streamlined approaches for 

determining BART. Thus, the 

commenter believes, EPA should ‘‘take 

care to ensure that a streamlined 

approach for the purpose of determining 

[the BART benchmark] is clear, 

permissible, and not legally unsound in 

the final rule.’’

Another commenter said that a 

streamlined approach ‘‘is an appropriate 

option that should be explicitly 

recognized and more fully developed in 

the final rule.’’ According to the 

commenter, either the CMAQ or CAMx 

regional photochemical models would 

be suitable for streamlined visibility 

assessments for BART determinations, 

but also stated that none of the models 

is capable of consistently producing 

unbiased results for all chemical 

constituents responsible for haze. One 

State commenter said that States in EPA 

Region 5 are using the CALPUFF model 

and it would prefer to continue doing 

so. The State would not object to 

allowing other models to be used so 

long as they are optional. 

Another commenter submitted 

comments detailing the reasons it 

believes CALPUFF is superior to 

photochemical grid models for purposes 

of source-by-source BART analysis. In 

brief, commenter explained that with 

grid models, the concentration of 

pollutants from a point source is 

automatically diluted evenly across the 

grid in which the source is located. This 

dilution effect can be partially redressed 

by employing smaller grid sizes or by 

using a hybrid model which employs 

Lagrangian methods (as used in 

CALPUFF) close to the source and 

switches to a grid method farther 

downstream. However, both of these 

methods are resource intensive. The 

commenter therefore believed that 

CALPUFF, which can use 

meteorological data bases developed for 

CMAQ and CAMx, should be the 

preferred option. 

Final Rule. Section 308(e)(1)(ii)(B) 

requires that, for fossil fuel-fired power 

plants with a total generating capacity of 

greater than 750MW, BART 

determinations be made pursuant to the 

BART guidelines. With respect to the 

type of air quality model used for the 

BART determination, the guidelines 

instruct States to use CALPUFF or 

another appropriate dispersion model to 

determine the visibility improvement 

expected at a Class I area from the BART 

control technology being evaluated (70 

FR 39170). 

We maintain that CALPUFF is the 

best model currently available for 

predicting visibility impacts from single 

sources. The use of regional scale 

photochemical grid models may have 

merit, but to date, such models have not 

been evaluated for single source 

applications (70 FR 39123). As the 

science and structure of regional 

photochemical grid models are 

improved and demonstrated to 

successfully predict impacts from single 

sources (e.g. plume in grid or source 

tagging techniques) at least as well as 

CALPUFF, such models may become 

more useful in streamlining the BART 

benchmark determination. All modeling 

applications in making BART 

determinations call for the development 

of a modeling protocol for all modeling, 

and States should consult with EPA and 

the relevant regional planning 

organization (RPO) before conducting 

any modeling. 

(2) State Discretion to Consider 

Cumulative Visibility Impacts 

Comments. Several commenters said 

that the Agency’s position described in 

the preamble to the proposed rule—that 


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5The comments criticizing the statement by EPA 

that States have the discretion to require a 

cumulative visibility analysis do not appear to 

challenge the general principle that a State may 

adopt measures in a SIP more stringent than 

Continued 

States have the discretion to require a 

cumulative visibility approach in setting 

the BART benchmark—violates the 

American Corn Growers decision. Most 

commenters opposed to EPA’s proposed 

interpretation, however, were also 

careful to point out that this did not 

indicate opposition to the policy of 

allowing a ‘‘group BART’’ benchmark to 

be used in the special case of evaluating 

emissions reductions required by other 

CAA or State law requirements. 

Commenters that objected to EPA’s 

statement that States have the discretion 

to use ‘‘group BART’’ in setting the 

BART benchmark referenced the courts’

opinions in American Corn Growers and 

CEED v. EPA to argue that such a 

statement was inconsistent with the 

CAA. Several commenters cited the 

American Corn Growers court’s 

statement that ‘‘the state must consider 

the degree of improvement in visibility 

in national parks and wilderness areas 

that would result from the source’s 

installing and operating the retrofit 

technology [in making a BART 

determination].’’ See American Corn 

Growers, 291 F.3d at 7. One commenter 

emphasized that the court had used the 

singular noun (‘‘the source’s’’) rather 

than the plural as a clear indication that 

the visibility factor must be assessed on 

a source-by-source basis. Another 

commenter pointed to the court’s 

statement, in regard to the approach in 

the 1999 Regional Haze Rule which 

separated the visibility factor from the 

other BART factors, that ‘‘[t]o treat one 

of the five statutory factors in such a 

dramatically different fashion distorts 

the judgment Congress directed the 

states to make for each BART-eligible 

source.’’ (291 F.3d at 6). No comments 

were received that explicitly supported 

EPA’s proposed interpretation of the DC 

Circuit’s decisions on this point. Several 

commenters also claimed that the 

flexibility to use ‘‘group BART,’’

described in the preamble, was not 

actually provided for in the proposed 

regulatory text, which cross-referenced 

to the source-by-source BART 

determinations prescribed in 

§ 51.308(e)(1). One commenter that 

strongly opposed EPA’s proposed 

position on this issue noted that ‘‘it is 

nevertheless true that states can use 

simplifying assumptions or even apply 

some type of ‘‘weight of evidence’’ test 

in determining the amount of emissions 

reductions that BART-eligible sources 

may be required to undertake as part of 

a regional trading program’’ The 

commenter did not elaborate on 

examples of appropriate simplifying 

assumptions or methods by which 

weight of evidence could be taken into 

account. 

Where an independent requirement 

determines the emissions reductions 

required of BART sources in a trading 

program or other type of similar 

program, however, commenters 

appeared to agree that a BART 

benchmark can be used that does not 

depend on source specific visibility 

assessments. In other words, for BART 

alternatives that are required by or that 

satisfy another CAA provision, the 

BART benchmark to be used in a 

‘‘better-than-BART’’ test may be 

established using a group BART 

approach. In particular, several 

commenters representing electric 

utilities and other industries submitted 

comments agreeing with our 

interpretation of section 169A of the 

CAA as allowing other programs to 

substitute for BART, and agreeing that 

where an independent requirement 

determines the emissions reductions 

required of BART sources, a moststringent BART benchmark could be 

used without raising the concerns at 

issue in the American Corn Growers and 

CEED v. EPA cases. These commenters 

particularly agreed with and supported 

the application of this rationale to the 

CAIR, as was finalized in the July 6 

BART Guidelines rulemaking. One 

commenter urged EPA to adopt specific 

regulatory language, as was done in the 

case of the CAIR, to implement this 

option both with respect to the WRAP’s 

program and to other programs which 

may be developed elsewhere. 

Final Rule. We have carefully 

considered the comments on the 

discussion in the NPRM addressing the 

discretion of the States in establishing a 

BART benchmark and concluded that 

this rulemaking should focus on the 

type of alternative program that we 

anticipate that some States may submit 

in lieu of BART. In providing States 

with the flexibility to adopt an 

alternative program, EPA has assumed 

that States would adopt trading 

programs, or other substantially similar 

programs—such as the WRAP’s 

backstop market trading program—as 

alternatives to source-by-source BART. 

While it is possible that a State could 

design a trading program under the 

authority of section 169A(b)(2)(A) of the 

CAA (the BART provision), we believe 

that it is far more likely that a State 

designing its regional haze plan would 

adopt a trading program under the 

broader authority of section 

169A(b)(2)(B) (the long-term strategy for 

making reasonable progress). As such, 

the regulations promulgated today 

provide a basic framework for States to 

demonstrate that any type of alternative 

program provides greater reasonable 

progress than BART, but provide greater 

detail as to how that demonstration 

might be done for a trading program (or 

other substantially similar program) 

designed to fulfill requirements other 

than BART. 

Generally, the comments received 

criticizing the statement that States have 

discretion to consider visibility in a 

cumulative manner in determining 

whether or not an alternative makes 

greater reasonable progress than would 

BART appear to be premised on the 

argument that any type of program that 

could be characterized as a BART 

program—even an alternative program—

is bounded by the requirements in 

section 169A(b)(2)(A). Thus, for 

example, several commenters cited the 

American Corn Growers court’s 

statement interpreting the definition of 

BART as grounds for limiting a State’s 

ability to take a different approach in 

developing an alternative program. In 

other words, in determining the amount 

of emissions reductions that sources in 

a trading program alternative must 

achieve to demonstrate that the trading 

program is ‘‘better’’ than source-bysource BART, these commenters argued 

that the States are limited to designing 

a program that begins with source 

specific visibility analyses. Applying 

the same logic, however, States would 

need to undertake source specific 

assessments of the other four factors in 

the BART definition: the costs of 

control, the energy and nonair quality 

environmental impacts, any existing 

pollution control technology in use at 

the source, and the remaining useful life 

of the source. Only once the State had 

ascertained what BART would be at 

each source subject to BART—based on 

a thorough source specific analysis of 

these five factors—could the State then 

show that its trading program achieves 

greater reasonable progress. Although 

the States may certainly adopt such an 

approach under this final rule, we think 

it unlikely that States would conduct 

such an extensive assessment only to 

then go through the additional, resource 

intensive steps of establishing a trading 

program. 

The concern underlying these 

comments appears to be that EPA 

should not explicitly authorize States to 

design a program more stringent than 

required for BART in establishing a 

BART alternative program under section 

169A(b)(2)(A) of the CAA.5 Obviously, 


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required under the CAA, except where explicitly 

prohibited. See Union Electric Co. v. EPA, 427 U.S. 

246, 263–264 (1976); see also Summary of 

Comments on the Revisions to Provisions Governing 

Alternative to Source-specific Best Available 

Retrofit Technology (BART) Determinations, Docket 

ID No. EPA–HQ–OAR–2002–0076, 

www.regulations.gov. 

under EPA’s interpretation of the CAA, 

upheld by the CEED v. EPA court, the 

alternative program must achieve 

greater reasonable progress than would 

BART, presumably in most cases by 

achieving greater emissions reductions 

over time. However, the commenters 

opposed to what they label a ‘‘group 

BART’’ approach argue that States must 

consider source-specific visibility 

impacts to avoid setting too high a bar 

for the program. Although the 

commenters have not suggested that the 

other simplifying approaches that we 

have suggested in the past for assessing 

the costs of control were an 

inappropriate form of ‘‘group-BART,’’ if 

the CAA requires visibility impacts to 

be considered on a case-by-case basis, 

then it would also seem to require that 

the costs of control and other factors be 

considered on a case-by-case basis. In 

other words, these commenters argue 

that the BART benchmark for an 

alternative program under section 

169A(b)(2)(A) must be based on a caseby-case analysis of what BART would 

be for each source subject to BART. 

The DC Circuit in CEED v. EPA was 

not absolutely clear as to whether its 

decision was based solely on the fact 

that EPA had required a ‘‘group BART’’

approach, or whether the fact the Annex 

contained such an analysis was in itself 

a sufficient reason to invalidate the 

Annex approval. As EPA explained in 

the proposed rule, we believe that the 

CEED v. EPA decision is limited to 

circumstances where EPA requires or 

induces States to adopt cumulative 

approaches that result in programs more 

stringent than required by the CAA. 

However, we did not receive comments 

from any States explicitly supporting 

our interpretation of the court’s 

holdings, and as we do not anticipate 

that States will submit plans with 

trading programs designed only to meet 

the requirements of section 169A(b)(2), 

we have concluded that the issue of 

whether the CAA provides States with 

the discretion in designing such 

programs to employ some type of 

cumulative approach or simplifying 

assumptions in the process of estimating 

emissions reductions achievable by 

source-by-source BART is not relevant 

to today’s rulemaking. 

The regulations finalized today 

provide that as a general matter, States 

must undertake source specific BART 

analyses under § 51.308(e)(1) for each 

source subject to BART in order to 

estimate the emissions reductions 

achievable under the source-by-source 

BART requirements. The use of such a 

BART benchmark enables a State to 

design an alternative program that is 

‘‘better than BART’’ based on a precise 

estimation of the emissions reductions 

that could be achieved under BART. 

For trading programs where the 

emissions reductions are required to 

fulfill CAA requirements other than 

BART (or to fulfill requirements of a 

State law or regulation not required by 

the CAA), we are amending the 

regulations to make clear that States 

may establish a BART benchmark based 

on a simplified BART analysis in such 

a situation. We agree with commenters 

that a BART benchmark based on such 

an analysis raises none of the concerns 

that were at issue in the American Corn 

Growers and CEED v. EPA cases. Where 

a trading program is designed to fulfill 

other requirements, including the 

requirement to make reasonable 

progress, an independent requirement 

determines the level of reductions 

achieved and the BART analysis serves 

only to ensure that the program meets 

the requirement that a BART alternative 

make greater reasonable progress than 

BART. In other words, there is no need 

to develop a precise estimate of the 

emissions reductions that could be 

achieved by BART in order simply to 

compare two programs. As EPA did in 

the CAIR, States should have the ability 

to develop a BART benchmark based on 

simplifying assumptions as to what the 

most-stringent BART is likely to 

achieve. The regulations finalized today 

therefore provide that where an 

emissions trading program has been 

designed to meet a requirement other 

than BART, including the reasonable 

progress requirement, the State may 

establish a BART benchmark based on 

an analysis that includes simplifying 

assumptions about BART control levels 

for sources within a source category. 

We do agree with commenters that 

EPA should issue regulatory language 

expressly allowing for the use of a 

BART benchmark based on a simplified 

BART analysis for demonstrating that 

emissions reductions required by other 

provisions also make greater reasonable 

progress than BART and may be used to 

substitute for BART. We have finalized 

such a provision at § 51.308(E)(2)(i)(C). 

This will help clarify that in such cases, 

the BART benchmark is not the ‘‘driver’’

of emissions reductions and is therefore 

not subject to the concerns on which the 

DC Circuit decided American Corn 

Growers and CEED. 

Role of BART Guidelines for EGUs in 

Determinations Proposal 

The BART guidelines establish 

control levels or emission rates as 

presumptive standards for EGUs greater 

than 200 MW capacity at plants with a 

total generating capacity in excess of 

750 MW. We proposed that the States 

apply these presumptive standards 

contained in the final BART guidelines 

in developing a BART benchmark for a 

trading program or other alternative that 

includes such EGUs. In other words, 

when States are estimating emission 

reductions achievable from source-bysource BART, they must assume that the 

EGUs which would otherwise be subject 

to BART will control at the presumptive 

level, unless the State demonstrates that 

such presumptions are not appropriate 

at particular units. The preamble to the 

proposed rule explained that this would 

be accomplished by the cross reference 

to § 51.308(e)(1) within proposed 

§ 51.308(e)(2)(i)(C), the provision 

prescribing the method of setting the 

BART benchmark. Section 51.308(e)(1), 

in turn, provides that BART 

determinations for EGUs of greater than 

200 MW capacity at plants with a total 

generating capacity greater than 750 

MW must be done in accordance with 

the BART guidelines in appendix Y to 

part 51. 

Comments. One commenter said that 

the presumptive standards for EGUs are 

too lenient and should be lowered 

before EPA allows States to use them for 

purposes of a ‘‘better than BART’’

demonstration. Another commenter 

supported the use of the presumptive 

standards in this context, but contested 

the preamble statement that the 

presumptive standards ‘‘apply to certain 

EGUs on a mandatory basis’’ because, 

according to the commenter, the 

presumptions are not mandatory in that 

they are rebuttable. Another commenter 

argued that the use of presumptive 

standards would make the installation 

of controls more likely, without regard 

to the visibility benefit expected. The 

commenter believes EPA use of 

presumptions is incompatible with CAA 

section 169A as interpreted in American 

Corn Growers and incompatible with 

EPA’s authority to issue BART guidance 

for EGUs of 750 MW or greater. 

Final Rule. The final rule 

promulgated on July 6, 2005, addresses 

the authority of EPA to establish the 

presumptions in the BART guidelines 

for certain EGUs, as well as the level of 

control reflected by those presumptions. 

In the NPRM, EPA did not request 

comment on the presumptions 

established in the Guidelines, but rather 

whether these presumptions should be 


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Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 60619 

used in establishing a BART benchmark 

for comparing an alternative program to 

BART. 

In today’s final rule, the regulations 

make clear that, with one exception, 

States must follow the approach for 

making BART determinations under 

section 51.308(e)(1) in establishing a 

BART benchmark. This includes the 

requirement for States to use the BART 

guidelines in making BART 

determinations for EGUs at power 

plants of a certain size. As discussed 

above, the one exception to this general 

approach is where the alternative 

program has been designed to meet 

requirements other than BART; in this 

case, States are not required to make 

BART determinations under 

§ 51.308(e)(1) and may use simplifying 

assumptions in establishing a BART 

benchmark based on an analysis of what 

BART is likely to be for similar types of 

sources within a source category. Under 

either approach to establishing a BART 

benchmark, we believe that the 

presumptions for EGUs in the BART 

guidelines should be used for 

comparison to a trading program or 

other alternative measure, unless the 

State determines that such 

presumptions are not appropriate for 

particular EGUs. We note that this 

limitation on the use of the 

presumptions is most likely to apply 

only in a source-by-source 

determination under § 51.308(e)(1). 

States establishing a BART benchmark 

based on simplifying assumptions as to 

the most-stringent BART for EGUs may 

rely on the presumptions, as EPA did in 

the CAIR rule. For States considering 

the appropriateness of the presumptions 

in specific cases, the same criteria 

discussed in the BART guidelines 

should guide them in reaching a 

conclusion. Thus, the presumptive 

standards are ‘‘mandatory’’ for the 

identified EGUs, in that the 

presumption must be applied to the 

specified class of EGUs; but the 

presumptive standards are rebuttable, as 

explained in the BART guidelines. 

We do not agree that EPA should 

revise the presumptive standards before 

allowing States to use them for purposes 

of establishing a BART benchmark. We 

believe it is appropriate for the States to 

use the same presumptions in 

developing the BART benchmark that 

they would use in making BART 

determinations. 

We determined in the BART final rule 

that the limits represented by the 

presumptions are cost effective for large 

EGUs at the largest power plants. We 

believe that the presumptions represent 

a reasonable estimate of a stringent case 

BART, particularly because in 

developing a BART benchmark they 

would be applied across the board to a 

wide variety of units with varying 

impacts on visibility, at power plants of 

varying size and distance from Class I 

areas. 

We do not agree that the use of 

presumptive standards ignores the 

visibility benefits to be expected from 

the control of the EGUs covered by the 

presumption. In the final BART 

guidelines establishing the 

presumptions, EPA took into account 

the degree of improvement in visibility 

that would result from the installation 

of the presumptive level of controls in 

finding that such controls should 

generally be found to be BART. As 

explained in the preamble to the BART 

guidelines, controlling the type of 

sources covered by the presumptions at 

the level of the presumptive standards 

is likely to result in a substantial degree 

of visibility improvement based on 

EPA’s modeling analyses. 

Minimum Universe of Sources Covered 

Proposal. In the 1999 Regional Haze 

Rule, the provisions for alternative 

programs to BART at section 

51.308(e)(2) contained a requirement 

that such a program must include, at a 

minimum, each BART-eligible source 

within the State. In the August 1, 2005 

proposal, we noted that having had the 

occasion to consider BART alternative 

programs in more detail, we believed 

that some categories of BART eligible 

sources might not be appropriate for 

inclusion in a cap and trade program. 

We provided the example of the 

difficulty in quantifying emissions with 

sufficient accuracy to participate in a 

trading program for some source 

categories. We therefore proposed to 

allow States to use a trading program or 

alternative measure to substitute for 

BART for some source categories, while 

requiring source-by-source BART for 

BART-eligible sources in any source 

categories not covered by the alternative 

program. We further proposed that for 

any categories which were included in 

the alternative program, we would 

retain the requirement that all BARTeligible sources in the State within that 

source category must be subject to the 

program. See proposed section 

51.308(e)(2)(ii). One reason for this 

proposed provision was to prevent any 

shifting of emissions from covered to 

non-covered BART eligible sources, 

which could potentially undermine the 

effectiveness of the emissions cap. In a 

related provision we proposed, as one of 

the minimum elements of a cap and 

trade program, that the applicability 

provisions must be designed to prevent 

any significant potential shifting of 

production and emissions within the 

State or multi-State region. See 

proposed section 51.308(e)(2)(vi)(A). 

Comments. Several commenters 

opposed the requirement to include in 

the alternative program all BARTeligible sources within a source 

category. Several of these commenters 

argued that such a requirement is a form 

of ‘‘group BART’’ invalidated by the DC 

Circuit because it would impose 

requirements on BART eligible sources 

without a demonstration that those 

sources are reasonably anticipated to 

cause or contribute to visibility 

impairment. One commenter argued 

that the requirement was unjustified as 

a practical matter, at least in the case of 

the forest products industry, because in 

order to be economically viable mills 

must be operated at near capacity. This 

would leave no leeway for production 

and emissions shifting. The commenter 

also argued that the provision is 

conceptually unjustified, considering 

that under a conventional source-bysource program, emissions shifting 

theoretically could occur to BARTeligible sources which were determined 

to be exempt from BART because they 

do not cause or contribute to visibility 

impairment. The commenter argued that 

it would be illegal to impose 

‘‘compensating costs’’ on such sources 

outside the trading program context. 

The implication of this comment is that 

it would also be illegal to impose such 

costs on these BART-eligible sources by 

requiring them to participate in the 

alternative program. 

In contrast, one State commented that 

allowing some source categories to add 

controls while others may avoid 

controls by buying reductions elsewhere 

would be contrary to its management 

principles. This commenter thought that 

the use of a trading program to address 

haze for some but not all sources subject 

to BART might be counter-productive. 

Similarly, another commenter noted 

that ‘‘carving out source categories 

would only shrink the universe of 

potential participants, the opposite of 

what is needed for a successful trading 

program.’’

Final Rule. Having carefully 

considered the comments and the 

relationship between the requirement 

for category-wide participation of 

BART-eligible sources and the 

requirements for the State to address 

emissions shifting, we are adopting final 

provisions that maximize the flexibility 

of the States while insuring that the 

BART-eligible sources are addressed in 

some fashion by the States. As we noted 

in 1999 in establishing the criteria 

governing BART alternative trading 

programs, the legislative history of the 


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6 In theory, a State could design a program to 

meet the reasonable progress or other requirements 

of the CAA that does not have sufficiently broad 

applicability provisions to encompass all BART 

sources. For example, a State could adopt a program 

that covers all sources with SO2 emissions greater 

than 1000 tons per year. In such a case, the BART 

sources not subject to the trading program would 

be subject to the requirements of section 308(e)(1). 

CAA demonstrates Congress’

recognition of the need to control 

emissions from a specific set of sources. 

We are therefore finalizing in this rule 

that States must require that each 

BART-eligible source in the State either 

participate in a BART alternative 

program or, alternatively, be subject to 

the case-by-case BART requirements 

under section 51.308(e)(1). In other 

words, States are not required to include 

each BART-eligible source in a source 

category in an alternative program; 

however, any BART-eligible sources not 

included in an alternative program 

would remain subject to the general 

requirements governing BART sources. 

For most trading programs, we do not 

anticipate that this requirement will 

have a significant impact on the scope 

of the program. Because trading 

programs generally include all sources 

within a source category in a trading 

region, trading programs designed to 

meet either reasonable progress goals or 

other requirements of the CAA are likely 

to have broad applicability provisions 

that encompass all BART-eligible 

sources in the trading region (or at least 

all BART-eligible sources within certain 

categories of sources for some trading 

programs). States have the inherent 

authority to determine the applicability 

of their regulations for programs such as 

those designed to meet reasonable 

progress requirements, or to attain the 

National Ambient Air Quality Standard 

(NAAQS), and are most likely to design 

programs with applicability provisions 

that are not dependent on factors such 

as the age of sources covered by the 

program. For example, States in the 

WRAP designed their program to apply 

to all stationary sources with actual 

emissions of 100 tons per year or more, 

regardless of the type of source or the 

age of the facility. 

We disagree that the requirement that 

States either require BART-eligible 

sources to participate in a trading 

program or go through a BART analysis 

is a form of ‘‘group BART’’ that would 

illegally impose requirements on such 

sources without a demonstration that 

those sources emit a pollutant that may 

reasonably be anticipated to cause or 

contribute to visibility impairment. As 

noted above, for programs designed to 

meet other requirements of the CAA, we 

would expect that the States would 

design programs that apply broadly, and 

nothing in the BART provisions of the 

CAA limits a States’ ability to regulate 

BART-eligible sources under other 

provisions in the CAA. Thus, for 

example, a State need not demonstrate 

that an EGU built between 1962 and 

1977 has a certain measurable impact on 

visibility before regulating it under the 

CAIR. Rather, the BART sources would 

be treated in the same manner as other 

sources in the State.6

In the case of programs designed 

solely to satisfy BART requirements, 

which may arguably be limited to BART 

sources only, the approach set forth in 

the final rule provides the opportunity 

for an individual source not to be 

regulated by a trading program. In 

particular, rather than participate in a 

trading program, a source may 

demonstrate that it does not meet the 

‘‘subject to BART’’ test or that BART 

should be ‘‘no control’’ in its particular 

case, seek an exemption from the 

Administrator under section 

51.308(e)(4), or install BART controls. 

This approach therefore avoids any 

potential problems involving BARTeligible sources which are not 

reasonably anticipated to cause or 

contribute to visibility impairment 

being illegally subject to program 

requirements. Rather, section 

51.308(e)(2) provides BART-eligible 

sources which are reasonably 

anticipated to cause or contribute to 

visibility the opportunity to participate 

in a trading program instead of meeting 

source specific control limits. 

Our concerns with emissions shifting 

will be addressed under the more 

general requirements applicable to 

trading programs. These provisions 

require States to demonstrate that the 

applicability provisions are designed to 

prevent any significant, potential 

shifting within the State of production 

and emissions from sources in the 

program to sources outside the program. 

This provision addresses emissions 

shifting from sources in the program to 

those outside the program, irrespective 

of the BART-eligibility status of the 

sources. Moreover, this demonstration 

will enable States to take into account 

the type of practical and economic 

factors raised by commenters which 

may obviate theoretical concerns with 

emission shifting. We also note that the 

periodic SIP updates required under 

§ 51.308(g) of the regional haze rule will 

provide an opportunity to assess 

whether emissions shifting is in fact a 

problem. 

Comparison of BART and Alternative 

Scenarios 

Proposal. In the NPRM, we proposed 

several changes to § 51.308(e)(2)(i). As 

explained in the preamble, the critical 

revision to that section to bring it into 

compliance with the decision of the DC 

Circuit in CEED v. EPA was to remove 

the requirement of a bifurcated 

approach to establishing the BART 

benchmark. We also proposed 

additional changes in the section which 

were intended to establish a clear 

‘‘framework’’ or step-by-step procedure 

for comparing an alternative program to 

source-by-source BART. This consisted 

of a five-step procedure in proposed 

paragraphs (A)–(E) within 

§ 51.308(e)(2)(i). In brief, those steps 

were: (A) List all BART-eligible sources, 

(B) list all BART source categories 

covered by the program, (C) analyze the 

degree of visibility improvement at each 

affected Class I area expected as a result 

of the application of BART pursuant to 

paragraph (e)(1) at each source subject 

to BART in each source category 

covered by the program, (D) analyze the 

emissions reductions and associated 

visibility improvement expected under 

the trading program or other alternative 

measure, and (E) compare the results of 

the steps in paragraphs (C) and (D) using 

the method prescribed under 

§ 51.308(e)(3). 

Section 51.308(e)(3), which was 

finalized in the BART guidelines 

rulemaking, establishes criteria for 

determining whether an alternative 

program makes greater reasonable 

progress than source-by-source BART. 

First, if the distribution of emissions is 

similar between the two scenarios, the 

comparison may be made on the basis 

of emissions alone. In that case, the 

alternative program may be deemed to 

make greater reasonable progress than 

BART if it results in greater emissions 

reductions than source-by-source BART. 

If, however, the geographic distribution 

of emissions reductions is significantly 

different under the two alternatives, the 

State must conduct visibility modeling 

and evaluate the alternative program 

under a two-pronged test. The first 

prong is that the alternative program 

must not cause a decline in visibility at 

any Class I area. The second prong is 

that there is an overall improvement in 

visibility under the alternative program, 

‘‘determined by comparing the average 

differences between BART and the 

alternative over all affected Class I 

areas.’’ See section 51.308(e)(3). 

In proposing the above-described 

structure of section 51.308(e)(2), we 

noted that we were proposing to add the 

term ‘‘affected’’ to modify the term 

‘‘Class I areas’’ in paragraph (C). The 

purpose of this was to clarify that a 

State need not evaluate visibility 

improvement at every Class I area 

nationwide. We also noted that, as 


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described in the preamble to the final 

BART guidelines, States have discretion 

in defining an ‘‘affected’’ Class I area. 

Finally, while noting that section 

51.308(e)(3) had been finalized, we 

sought comment on whether EPA 

should allow other means of 

demonstrating that an alternative 

program makes greater reasonable 

progress than would BART. 

Specifically, we solicited comments on 

whether a weight of evidence approach 

would be appropriate. We gave the 

following scenario as an example of a 

situation where such an approach might 

be appropriate: ‘‘(1) The alternative 

program achieves emissions reductions 

that are within the range believed 

achievable from source-by-source BART 

at affected sources, (2) the program 

imposes a firm cap on emissions that 

represents meaningful reductions from 

current levels and, in contrast to BART, 

would prevent emissions growth from 

new sources, and (3) the State is unable 

to perform a sufficiently robust 

assessment of the programs using the 

two pronged visibility test due to 

technical or data limitations.’’

Comments. One commenter noted 

that there was a contradiction between 

the terms of § 51.308(e)(3) as finalized 

and § 51.308(e)(2) as proposed. 

Specifically, whereas under 

§ 51.308(e)(3), dispersion modeling is 

required only if the distribution of 

emissions distribution is significantly 

different, under the alternative measure, 

in proposed section 51.308(e)(2), 

dispersion modeling is required as a 

matter of course in developing the two 

scenarios to be compared. 

Several commenters also supported 

the ‘‘weight of evidence’’ approach to 

demonstrate that an alterantive makes 

greater reasonable progress than BART. 

One commenter specified that the 

‘‘regulation should require a weight of 

evidence demonstration to include 

emission inventory, monitoring data, 

meteorology, and various data analysis 

studies,’’ and that modeling should not 

necessarily be weighted more heavily 

than the other factors listed. 

With respect to the definition of an 

‘‘affected’’ Class I area, one commenter 

pointed to possible inconsistent 

application among States and 

uncertainty as to which States should 

make the determination (i.e., only the 

State which contains the Class I area, or 

other States as well). The commenter 

therefore requested that EPA clarify 

when a Class I area is affected by 

emissions and the radius from a source 

within which an analysis should be 

done. 

Another commenter claimed that our 

discussion of section 51.308(e)(3) reopened that provision for comment in 

this rulemaking and created a renewed 

opportunity for judicial review. The 

commenter then raised several 

arguments regarding the legality of 

section 51.308(e)(3) under the CAA. The 

commenter argued that the proposed 

rule was overly broad in failing to 

specify that only sources participating 

in a trading program or other alternative 

measure may satisfy BART for those 

sources and the specific visibilityimpairing pollutant at issue. The 

commenter also argued that the test is 

impermissibly vague in providing for 

dispersion modeling if the distribution 

of emission is ‘‘substantially different.’’

The commenter also claimed that by 

allowing States to compare ‘‘average 

differences’’ between BART and the 

alternative over all affected Class I areas 

was inconsistent with the CAA. Finally, 

the commenter responded to our request 

for comment on a weight of evidence 

test, stating that allowing unspecified 

‘‘qualitative factors’’ to trump other, 

more quantitative assessments would 

dramatically weaken the rule. 

Final Rule. We agree with 

commenters who pointed to the 

inconsistency between the proposed 

provisions of section 51.308(e)(2) and 

the existing terms of section 

51.308(e)(3). This conflict was the result 

of inadvertent error, and we are 

correcting it in the final rule. 

Specifically, we have eliminated the 

clauses within section 51.308(e)(2)(C) 

and section 51.308(e)(2)(D) which 

required that visibility improvement be 

projected at those steps in the process. 

Instead, these paragraphs call only for 

an assessment of emissions reductions 

under BART and alternative scenarios, 

respectively. We have also clarified in 

section 51.308(e)(2)(E) that visibility 

projections are required only if 

necessary, pursuant to section 

51.308(e)(3). 

Because we have eliminated the 

requirement for visibility projections 

within the analysis prescribed in section 

51.308(e)(2), there is no longer a need to 

define an affected Class I area in the 

context of this section. Instead, that 

term is defined in the context of section 

51.308(e)(3), at the States’ discretion as 

discussed in the preamble to the final 

BART rule. See 70 FR 39138. The EPA 

continues to believe that it is not 

necessary to bound the terms of that 

discretion upfront through Federal 

regulation. Any potential problems due 

to inconsistent application among States 

can be addressed through the RPO and 

inter-RPO processes already in place 

and ultimately through the SIP process. 

This will allow consideration of the 

potential effects of local conditions and 

of particular trading programs as they 

are developed. It should, therefore, 

produce more reasoned results than 

would the establishment of a 

nationwide, one-size-fits-all radius of 

influence criterion. 

We disagree with comments that EPA 

reopened section 51.308(e)(3) by 

discussing the provisions of this section 

of the rule in the proposal, or that 

today’s rule has impacted the meaning 

of section 51.308(e)(3). 

Notwithstanding the fact that this 

provision was not reopened, we note 

that EPA disagrees with the substance of 

the comments claiming that section 

51.308(e)(3) is overly broad and vague. 

The commenter’s concerns regarding the 

failure of section 51.308(e)(3) to specify 

that only those sources participating in 

a trading program may satisfy BART for 

those sources is addressed in the 

regulations under section 

51.308(e)(2)(i)(B), which provides that 

each BART-eligible source in a State 

must be included in an alternative 

program, have a BART emission limit, 

or otherwise be addressed under the 

BART provisions. The commenter’s 

concerns regarding the ‘‘impermissibly 

vague’’ language used in section 

51.308(e)(3) that would allow a State to 

approve alternative measures that are 

less protective than BART ignore the 

SIP process. The State’s discretion in 

this area is subject to the condition that 

it must be reasonably exercised and that 

its decisions be supported by adequate 

documentation of its analyses. 

We also disagree with the comments 

criticizing the test finalized in section 

51.308(e)(3) for allowing States to 

consider the average differences 

between BART and the alternative in 

determining whether the alternative 

makes greater reasonable progress. In 

short, as explained in the response to 

comments to the BART Guideline 

rulemaking, EPA believes the test in 

section 51.308(e)(3) is an appropriate 

one: 

In addition, within a regional haze context, 

not every measure taken is required to 

achieve a visibility improvement at every 

class I area. BART is one component of long 

term strategies to make reasonable progress, 

but it is not the only component. The 

requirement that the alternative achieves 

greater progress based on the average 

improvement at all Class I areas assures that, 

by definition, the alternative will achieve 

greater progress overall. Though there may be 

cases where BART could produce greater 

improvement at one or more class I areas, the 

no-degradation prong assures that the 

alternative will not result in worsened 

conditions anywhere than would otherwise 

exist, and the possibility of BART for 

reasonably attributable visibility protects 

against any potential ‘‘hot spots.’’ Taken 


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7Summary of Comments and Responses on the 

2004 and 2001 Proposed Guidelines for Best 

Available Retrofit Technology (‘‘BART’’) 

Determinations under the Regional Haze Rule, 

Docket Number EPA–HQ–OAR–2002–0076, at 253. 

8The final BART Guidelines address this general 

question of applicability. 70 FR at 39161. 

together, the EPA believes these factors make 

a compelling case that the proposed test 

properly defines ‘‘greater reasonable 

progress.’’ The EPA anticipates that regional 

haze implementation plans will also contain 

measures addressing other sources as 

necessary to make progress at every 

mandatory federal Class I area.7

With respect to the use of a ‘‘weight 

of evidence’’ approach as an alternative 

to the methodology of section 

51.308(e)(3), we support the use of such 

a test as an alternative to the 

methodology set forth in section 

51.308(e)(3). ‘‘Weight of evidence’’

demonstrations attempt to make use of 

all available information and data which 

can inform a decision while recognizing 

the relative strengths and weaknesses of 

that information in arriving at the 

soundest decision possible. Factors 

which can be used in a weight of 

evidence determination in this context 

may include, but not be limited to, 

future projected emissions levels under 

the program as compared to under 

BART, future projected visibility 

conditions under the two scenarios, the 

geographic distribution of sources likely 

to reduce or increase emissions under 

the program as compared to BART 

sources, monitoring data and emissions 

inventories, and sensitivity analyses of 

any models used. This array of 

information and other relevant data may 

be of sufficient quality to inform the 

comparison of visibility impacts 

between BART and the alternative 

program. In showing that an alternative 

program is better than BART and when 

there is confidence that the difference in 

visibility impacts between BART and 

the alternative scenarios are expected to 

be large enough, a weight of evidence 

comparison may be warranted in 

making the comparison. The EPA will 

carefully consider the evidence before 

us in evaluating any SIPs submitted by 

States employing such an approach. 

B. Comments Relating to the Final 

Determination That CAIR Makes Greater 

Reasonable Progress Than BART in the 

July 6, 2005 BART Guideline Rule 

In the final BART guidelines 

rulemaking on July 6, 2005, EPA 

determined that the CAIR makes greater 

reasonable progress than BART for 

certain EGUs and pollutants (70 FR 

39138–39143). We did not seek 

comment on this determination, but we 

nonetheless received comments related 

to this final rule. 

Comments. Several organizations 

submitted comments regarding BART 

relief for non-EGUs in the CAIR region. 

They assert that the CAIR will achieve 

more reasonable progress than would 

BART for all BART-eligible sources in 

the CAIR region, including non-EGUs. 

Therefore, they urge EPA to amend its 

final determination to include BART 

relief for non-EGUs and to provide 

supporting analysis for this 

demonstration. 

In contrast, another commenter 

disagreed with our previous 

determination that the CAIR will make 

greater reasonable progress than BART. 

The commenter acknowledged that that 

determination was not at issue in this 

rulemaking. However, this commenter 

was concerned that there would not be 

enough BART-eligible sources in nonCAIR States to support an effective 

BART trading program outside the CAIR 

region. The commenter was also 

concerned about the administrative 

costs that a trading program would 

impose on non-CAIR States. The 

commenter therefore urged EPA to 

establish an alternative mechanism, 

such as ‘‘an exchange ratio for Acid 

Rain allowances held, or ‘BART’

allowances generated by sources located 

in CAIR states’’ in order to allow 

participation in an effective trading 

program by sources in non-CAIR States. 

One commenter urged EPA to clarify 

that where another program requires 

controls of one pollutant at BARTeligible sources, BART applicability for 

other pollutants is not affected. 

One commenter said that it does not 

believe EPA has the authority to 

‘‘circumvent’’ CAA requirements for 

controlling specific BART sources that 

affect visibility in a Class I area. They 

believe that EPA should require States 

to show that all BART sources will be 

controlled first as part of any showing 

that an alternative program is ‘‘better 

than BART.’’ This commenter also 

requested clarification as to which CAA 

requirements could be included in SIPs 

to make a ‘‘better than BART’’ showing. 

Final Rule. The DC Circuit in CEED v. 

EPA upheld EPA’s interpretation of 

section 169A of the CAA as allowing for 

an alternative program, such as an 

emissions trading program, to be 

adopted in lieu of source-by-source 

BART controls. It is EPA’s view that 

emissions reductions required by CAA 

(or State) provisions other than BART 

may be used to satisfy BART, so long as 

the program achieves greater reasonable 

progress than would BART at the BARTeligible sources affected. The 

preponderance of comments also 

supported this position, and the 

comments in opposition did not raise 

any arguments that were not addressed 

either in the course of the CAIR 

rulemaking or in the final determination 

that the CAIR may substitute for BART 

for EGUs in affected States made in the 

July 6, 2005 rule. As previously 

explained, ‘‘EPA does not believe that 

anything in the CAA or relevant case 

law prohibits a State from considering 

emissions reductions required to meet 

other CAA requirements when 

determining whether source-by-source 

BART controls are necessary to make 

reasonable progress.’’ (70 FR 39143; see 

also 70 FR 25300–302). 

With respect to those comments 

specifically directed at whether the 

CAIR makes greater reasonable progress 

than BART and, if so, what the scope of 

BART relief should be (i.e., whether it 

should extend to non-EGUs), it is 

important to emphasize that the 

determination that the CAIR makes 

greater reasonable progress than BART 

for SO2 and nitrogen oxides (NOX) at 

EGUs in the CAIR region, and thus may 

substitute for BART for those pollutants 

and those sources, was finalized in the 

July 2005 BART rule. Our supporting 

technical analysis for the determination 

that the CAIR is ‘‘better than BART’’

addressed only the comparative 

visibility impacts of the CAIR trading 

programs with respect to EGUs versus 

BART for EGUs. A determination at this 

time that the CAIR trading programs for 

EGUs could substitute for BART at nonEGUs as well as for EGUs is beyond the 

scope of this rulemaking. 

With respect to the request that we 

clarify that where another program 

requires controls of one pollutant at 

BART-eligible sources, BART-eligibility 

for other pollutants is not affected, we 

note that EPA agrees with this 

interpretation of the BART 

requirements.8 As a general matter, if a 

program exists for the control of one 

pollutant at BART-eligible sources, 

emissions of other visibility-impairing 

pollutants merit analysis to determine if 

visibility impairment is such that 

additional controls would or would not 

be warranted. However, it is possible 

that a State could demonstrate that a 

trading program that addresses one or 

two visibility-impairing pollutants 

under an alternative program would 

provide greater reasonable progress than 

would case-by-case BART applied to all 

visibility-impairing pollutants. With 

respect to EPA’s determination that the 

CAIR provides for greater reasonable 

progress than BART for EGUs, EPA 

found that CAIR States which 

participate in the EPA-administered 


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CAIR cap-and-trade programs for SO2

and NOX would be allowed to treat the 

participation of EGUs in this program as 

a substitute for the application of BART 

controls for these pollutants at affected 

EGUs. EPA further explained in the 

preamble to the July 2005 BART rule 

that a CAIR State that participates in the 

EPA-administered CAIR seasonal NOX

trading program only, would still need 

to address BART for SO2 emissions from 

EGUs. 70 FR at 39143. In short, EPA’s 

determination that the EPAadministered CAIR trading programs 

provide for greater reasonable progress 

than BART was limited to the pollutants 

covered by the EPA-administered CAIR 

trading programs in which the State 

chooses to participate. 

Finally, we agree with the comment 

that EPA should clarify those CAA 

requirements that a State should include 

in its implementation plan if it intends 

to rely on its participation in the CAIR 

trading programs rather than to require 

BART for its EGUs. In our July 2005 

BART rule, EPA promulgated 

regulations effectuating our 

determination that States which adopt 

the CAIR model trading rules for SO2

and NOX would be allowed to treat the 

participation of EGUs in these programs 

as a substitute for application of BART 

controls for these pollutants at affected 

EGUs. The regulations at 40 CFR 

51.308(e)(4) (as established in the July 6, 

2005 BART rule) provide the following: 

A State that opts to participate in the Clean 

Air Interstate Rule cap-and-trade and trade 

[sic] program under part 96 AAA–EEE need 

not require affected BART-eligible EGU’s 

[sic] to install, operate, and maintain BART. 

A State that chooses this option may also 

include provisions for a geographic 

enhancement to the program to address the 

requirement under § 51.302(c) related to 

BART for reasonably attributable impairment 

from the pollutants covered by the CAIR capand-trade program. 

70 FR at 39156. Subparts AAA–EEE of 

part 96 set forth a portion of the model 

trading rules (which comprise subparts 

AAA–III of part 96) that States must 

incorporate, with some allowed 

modifications, into their SIPs to 

participate in the EPA-administered 

CAIR SO2 cap-and-trade program. 

Although the regulations do not 

specifically address participation in the 

NOX cap-and-trade program, EPA fully 

anticipated that any State choosing to 

adopt the annual SO2 model trading 

rules would also choose to adopt the 

annual NOX model trading rules. In 

addition to numerous practical 

considerations that would lead States to 

adopt the model rules for and thus 

choose to participate in both annual 

trading programs (as opposed to the SO2

program only), as noted above, the CAIR 

substitutes for BART only for those 

pollutants covered by the EPAadministered CAIR trading programs in 

which the State chooses to participate. 

EPA agrees, however, with the comment 

that the BART requirements for SIPs 

should be clarified and is revising the 

regulatory text of the regional haze rule 

to more closely align with the 

determination regarding the relationship 

between CAIR and BART made by EPA 

in 2005. We are revising the regulations 

accordingly to make clear that 

participation in either the annual or 

seasonal CAIR NOX cap-and-trade 

program is a necessary condition for 

relying on EPA’s determination that 

States can substitute CAIR for BART for 

NOX. We are also revising the 

regulations to clarify that a State that 

participates only in the ozone season 

NOX cap-and-trade program may rely on 

EPA’s determination that CAIR makes 

greater reasonable progress than BART 

for NOX, but, as discussed above, such 

a State would still need to address 

BART for SO2. As noted above, EPA 

anticipates that all States opting to 

participate in the annual NOX cap-andtrade program will also participate in 

the SO2 cap-and-trade program. 

In addition to clarifying the 

applicable SIP requirements, we are also 

revising the regulatory text to account 

for the rule signed by the Administrator 

on March 15, 2006 promulgating 

Federal implementation plans (FIPs) for 

all jurisdictions covered by the CAIR. 

These FIPs adopt the model cap-andtrade programs that EPA proposed in 

the CAIR as a control option for States, 

with minor adjustments to account for 

Federal rather than state 

implementation. Each jurisdiction in the 

CAIR region will be subject to the 

requirements set forth in these FIPs 

when they became effective on June 27, 

2006. The EPA intends to withdraw the 

FIP in a State in coordination with 

EPA’s approval of a SIP for that State 

that meets the CAIR requirements. 

However, EPA anticipates that some 

States may choose to remain subject to 

the CAIR FIP and either not submit any 

SIP revisions or submit abbreviated SIP 

revisions that modify certain limited 

provisions of the CAIR FIP trading 

programs. The EPA’s determination in 

the 2005 BART rule that States which 

adopt the CAIR model trading rules 

could treat this as a substitute for BART 

for EGUs was based on our finding that, 

if the CAIR reductions are achieved 

through implementation of the EPAadministered trading programs in the 

model trading rules, CAIR makes greater 

reasonable progress than BART for these 

sources. This finding holds true whether 

a State chooses to submit a SIP under 

part 96, remain subject to a FIP under 

part 97, or adopt some combination of 

the two. 

C. Minimum Elements of Cap and Trade 

Programs 

The August proposal discussed a set 

of minimum elements that any cap and 

trade program should contain, in order 

that it be workable and enforceable. We 

received very little comment on most of 

the proposed minimum elements. The 

discussion below focuses only on those 

provisions on which we received 

comment. Other elements on which we 

did not receive comments are finalized 

as they were proposed, and are not 

discussed further below. 

Penalty Provisions 

Proposal. We proposed that the 

minimum program element for excess 

emission penalties would be a 

mandatory deduction, from a source’s 

allowance account, of at least three 

times the excess emissions. We 

explained that this allowance deduction 

must occur automatically upon the 

State’s or Tribe’s determination of 

excess emissions, though it may be 

reversed if the source successfully 

appeals that determination. The appeal 

could be based on the determination of 

the number of allowances held by the 

source as of the allowance transfer 

deadline and available for compliance, 

the amount of the source’s emissions, or 

the comparison of the amount of the 

source’s emissions and the total tonnage 

value of the source’s allowances held 

and available for compliance. 

Comments. A commenter said that in 

order to effectively and clearly deter 

noncompliance and preserve 

consistency with other cap and trade 

programs and EPA’s economic incentive 

policies, EPA must require as a 

minimum element of all cap and trade 

programs the imposition of monetary 

penalties for noncompliance, in 

addition to the automatic allowance 

deductions prescribed. No other 

comments were received on this specific 

issue. 

Final Rule. The EPA agrees that cap 

and trade programs need to have swift 

and unambiguous penalties to deter 

noncompliance and to ensure the 

integrity of the market for allowances. 

The EPA believes that an automatic 

allowance deduction penalty of at least 

three times the amount of excess 

emissions, which is required under 

section 51.308(e)(2)(vi)(J), is an effective 

deterrent for noncompliance. And given 

that allowances have monetary value, 

such a deduction would result in an 


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automatic monetary loss to the entity in 

question. 

The commenter asserted that EPA 

must require in section 

51.308(e)(2)(vi)(J) that a cap and trade 

program provide for both an automatic 

offset of any excess emissions (i.e., the 

automatic deduction of one allowance 

for each ton of emissions for which an 

allowance was not held by the source) 

and an automatic monetary penalty (i.e., 

the automatic requirement to pay a 

specified amount of money for each ton 

of excess emissions). In the proposed 

regulation, EPA instead took the 

approach of requiring an automatic 

allowance deduction of at least three 

allowances for each ton of excess 

emissions. This deduction includes both 

an automatic one-to-one offset and an 

automatic allowance penalty of at least 

two-to-one. The commenter failed to 

explain why giving up allowances in 

addition to a one-for-one offset provides 

any less deterrence for noncompliance 

than paying money in addition to a onefor-one offset. Each allowance has a 

monetary value on the allowance 

market, and the source is penalized for 

noncompliance by having to give up 

assets whether the assets are in the form 

of allowances or in the form of money. 

In short, there is nothing inherent in the 

nature of an automatic allowance 

deduction that would make such a 

deduction any less effective a deterrent 

than an automatic monetary penalty. 

Further, EPA believes that the cost, to 

a source, of a penalty for excess 

emissions should be significantly 

greater than the cost, to a source, of 

purchasing allowances to be in 

compliance. The most straight-forward 

way of ensuring a consistent 

relationship between the cost of 

noncompliance (i.e., the excess 

emissions penalty) and the cost of 

compliance is to impose an excess 

emissions penalty in the form of an 

automatic allowance deductions that are 

a fixed multiple of the amount of excess 

emissions. Here, the automatic penalty 

consists of at least a three-to-one 

allowance deduction, which includes 

the one-for-one offset plus an additional 

two-for-one allowance surrender. The 

EPA notes that the commenter did not 

object to this level of penalty, but 

simply claimed that the penalty should 

have a portion in the form of money. 

The EPA believes that the level of the 

penalty, as well as the form of the 

penalty, specified in section 

51.308(e)(2)(vi)(J) are reasonable. 

Finally, the commenter errs in its 

assertion that EPA’s approach in section 

51.308(e)(2)(vi)(J) deviates from ‘‘longstanding’’ policies in requiring 

automatic allowance deductions rather 

than automatic monetary penalties for 

cap and trade programs. In fact, EPA 

took the same approach in the NOX

Budget Trading Program regulations 

promulgated in 1998 (63 FR 57356, 

57528) (section 96.54(d)(1))) and in the 

CAIR trading program regulations 

recently promulgated in 2005 (70 FR 

25162, 25353, 25373–74, and 

25396)(section 96.154(d)(1), section 

96.254(d)(1), and section 96.354(d)(1)) 

and Clean Air Mercury Rule (CAMR) 

trading program regulations 

promulgated in 2005 (70 FR 28606, 

28669) (section 60.4154(d)(1)). The EPA 

notes that, for any trading program 

established under the CAA, a source 

with excess emissions is subject to 

discretionary monetary penalties under 

section 113 of the CAA, in addition to 

the automatic penalties established by 

the respective trading program. See, e.g., 

63 FR 57528 (section 96.64(d)(3) (stating 

that the automatic penalty under NOX

Budget Trading Program does not affect 

liability for any other penalty under the 

CAA). 

Emissions Monitoring 

Proposal. In the NPRM, we proposed 

a requirement that the monitoring, 

recordkeeping, and reporting provisions 

for boilers, combustion turbines, and 

cement kilns participating in a trading 

program comply with part 75, and that 

other sources in the program include 

monitoring, recordkeeping, and 

reporting provisions that result in 

information of the same precision, 

reliability, accessibility and timeliness 

as provided for under part 75. This 

proposed requirement was based on the 

need for consistent and accurate 

measurement of emissions to ensure 

that each allowance actually represents 

its specified tonnage value of emissions 

and that reported emissions are fungible 

across different sources. We also 

proposed that any sources that are 

subject to the cap and trade program but 

prohibited from selling emissions 

allowances would not be subject to the 

requirement that the monitoring, 

recordkeeping, and reporting provisions 

be consistent with, or equivalent to, part 

75. 

Comments. Several commenters 

expressed concerned that the emissions 

monitoring requirement would be 

unduly burdensome for small sources 

which are not currently subject to 

monitoring requirements. One 

commenter stated that because the cost 

of operating continuous emissions 

monitors (CEMs) tends not to decline 

proportionally with emissions or 

output, the costs of CEMs for small 

industrial sources is much higher than 

for large EGUs on a per-ton basis. The 

commenter also argued that the superior 

accuracy of CEMs compared to other 

methods such as emission factors, on a 

percentage basis, was not worth the cost 

when applied to the total emissions 

from small sources. The commenter 

therefore suggested that EPA should 

allow States to assume, when 

establishing the BART benchmark, that 

individual emissions units with annual 

emission levels less than the de minimis 

levels would not be controlled, and to 

the extent that such sources are required 

to participate in a BART trading 

program, that they not be required to 

use CEMs. Another commenter, citing 

similar concerns, suggested that EPA 

could establish a threshold source size 

for each affected source category, and 

provide alternatives to Part 75 

monitoring for sources below the 

threshold. The commmenter also 

suggested allowing alternatives such as 

parametric monitoring or periodic 

sources test, possibly with the use of a 

conservative adjustment factor to 

compensate for the greater uncertainty 

of those methods. 

Final Rule. The EPA is aware of the 

need to balance considerations of the 

accuracy and reliability of emissions 

monitoring and reporting with costs 

considerations, particularly as 

applicable to small sources. We believe 

the approach contained in the proposal 

strikes the proper balance and provides 

States with adequate flexibility to 

address sources’ concerns with the cost 

of CEMs monitoring. First, the 

requirement to comply with part 75 

only applies to boilers, combustion 

turbines and cement kilns. For all other 

sources, the requirement is that the 

sources ‘‘provide information with the 

same precision, reliability, accessibility, 

and timeliness’’ as provided by part 75. 

Any sources which are prohibited from 

selling allowances (including boilers, 

combustion turbines, or cement kilns) 

are not required either to comply with, 

or be consistent with, part 75. 

Second, even within part 75, there are 

alternatives to CEMs in appropriate 

circumstances. As explained in a 

footnote in the proposal, part 75 

establishes requirements for CEMS, as 

well as other types of monitoring (e.g., 

low mass emissions monitoring under 

section 75.19) that may be used in lieu 

of CEMS under certain circumstances. 

Part 75 also establishes a process for 

proposal by owners and operators, and 

approval by the Administrator, of 

alternative monitoring systems (under 

subpart E of part 75) that meet 

requirements concerning precision, 

reliability, accessibility, and timeliness. 

We continue to believe that it is 

essential to the integrity of any 


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Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 60625 

9See Docket EPA–HQ–OAR–2002–0076. 

10See legacy EPA Docket A–95–38, Item number 

VII–G–76. 

emissions trading program that those 

sources that are allowed to sell 

allowances must either comply with or 

be consistent with the requirements of 

part 75 (depending on the source 

category). Therefore, we are finalizing 

those requirements as proposed. 

Finally, we believe there is some 

merit to the commenter’s point that 

States should be allowed to assume, 

when establishing the BART 

benchmark, that individual emissions 

units with annual emission levels less 

than the de minimis levels would not be 

controlled. In the BART Guidelines we 

indicated that States may choose to set 

de minimis levels for individual 

pollutants at BART-eligible sources, so 

long as those de minimis levels are set 

at or below PSD applicability levels for 

those pollutants. We said that sources 

with emissions of an individual 

pollutant below de minimis levels could 

be excluded from BART-eligibility. 

Similarly, we believe that for the 

purposes of an alternative program, de 

minimis levels set at or below PSD 

applicability levels for those pollutants 

would be appropriate. In other words, 

States could assume, when establishing 

the BART benchmark, that they need 

not include emissions that total less 

than de minimis amounts of an 

individual pollutant at a BART-eligible 

source. 

III. Revisions to Regional Haze Rule 

§ 51.309 

Support for the WRAP Program 

Comments. We received very few 

comments addressing our proposed 

revisions to section 51.309. One 

commenter stated that it agreed with 

EPA’s proposed changes to this section 

of the Regional Haze Rule, but asked for 

clarification on several points. At the 

public hearing on the proposed rule, 

representatives of the WRAP and the 

State of Utah Division of Air Quality 

expressed general support for the 

proposal and appreciation of EPA’s 

efforts to provide an opportunity for 

affected States and tribes to continue to 

utilize the extensive work of the GCVTC 

and the WRAP. The representative of 

Utah added: 

Any suggestion that EPA has forced Utah 

into protecting visibility in Utah’s protected 

areas or that EPA is forcing Utah to 

participate in alternatives to BART is simply 

untrue * * * Statements that claim this rule 

usurps state authority are absolutely not true 

* * * In fact, Section 309 has always been, 

and continues to be, a state-driven 

regulation.9

Another commenter requested 

clarification of the potential geographic 

scope of the program in § 51.309. 

Final Rule. The EPA remains 

committed to allowing States and Tribes 

the flexibility to use innovative 

approaches such as market-based 

emissions trading programs to meet 

CAA requirements where appropriate, 

and agrees that EPA has never 

attempted to coerce States and Tribes 

into adopting such alternative programs 

in lieu of BART. The provisions in the 

Regional Haze Rule allowing for 

alternatives to BART generally, and the 

WRAP backstop trading program in 

particular, were originally included at 

the request of the States.10

As was the case in 1999 when EPA 

added section 51.309 to the Regional 

Haze Rule to recognize to work of the 

GCVTC, the option set out in section 

51.309 is applicable to the States and 

Tribes of the GCVTC transport region: 

Arizona, California, Colorado, Oregon, 

Idaho, Nevada, New Mexico, Utah, and 

Wyoming, and all federally-recognized 

Tribes within the exterior boundaries of 

those States. Section 51.309 establishes 

the requirements for the first regional 

haze plans for the 16 Class I areas 

covered by the GCVTC Report, listed in 

section 51.309(b)(1). The geographic 

scope of the program, in terms of the 

Class I areas for which reasonable 

progress goals are satisfied, may be 

expanded upon adequate 

demonstrations pursuant to section 

51.309(g). 

The WRAP Program as a Reasonable 

Progress Measure 

Proposal. The requirement in the 

CAA that States make reasonable 

progress towards the national visibility 

goal, while related to the BART 

requirement, is a separate requirement 

analogous to the NAAQS-based 

requirements in the CAIR. For the 

reasons presented above in this 

preamble in the discussion of 

‘‘independent requirements’’ in general, 

we proposed that for a program 

designed to meet reasonable progress 

requirements, the BART benchmark 

may be based on simplifying 

assumptions without running afoul of 

the DC Circuit’s decision in CEED v. 

EPA. We characterized such a program 

as one that includes BART sources and 

has the purpose of satisfying reasonable 

progress requirements for a larger 

universe of sources. 

Comments. Although the preamble 

discussion of this issue was not limited 

to or expressly directed towards the 

WRAP’s program, most of the comments 

received were in regard to the 

application of this concept to the 

WRAP. The WRAP itself submitted 

comments in agreement with our 

interpretation and supporting the 

inclusion of this option in the final rule. 

In addition, another commenter 

explicitly supported the use of this 

approach. In its comments, the UARG 

stated that the ‘‘[u]se of the group-BART 

approach for justifying the WRAP 

Annex would be appropriate because 

the WRAP Annex would be the SO2

portion of the section 169A reasonable 

progress program for the 16 Colorado 

Plateau Class I areas, and thus would be 

a BART alternative program that is 

required under another CAA provision.’’

As noted previously in this preamble, 

this commenter urged EPA to include 

language within the rule itself, in 

addition to the preamble discussion, to 

allow States to use a ‘‘group BART’’

approach to derive the BART 

benchmark when the BART alternative 

program is required by another 

provision of law. This commenter also 

requested that EPA make it clear in 

regulatory language that this provision 

applies to the WRAP. 

Another commenter said that through 

the proposed rule, EPA was essentially 

proposing to repromulgate the WRAP 

Annex. The commenter, while not 

disputing the proposition that a program 

designed to meet reasonable progress 

could be evaluated against a groupBART benchmark, argued that the 

previous Annex milestones could not be 

‘‘recycled’’ under this rationale because 

they were not developed as reasonable 

progress measures. Instead, the 

commenter argued, the milestones were 

derived directly from BART by the 

WRAP. The commenter also argued that 

the milestones cannot be justified as a 

reasonable progress measure because 

the modeling submitted with the Annex 

showed that the stationary source 

program for SO2 would achieve no 

humanly perceptible visibility 

improvement. Finally, the commenter 

argued that the milestones cannot be 

‘‘restored’’ because there is no ‘‘coherent 

reasonable progress rationale’’

underlying them. 

After the comment period closed, a 

commenter submitted supplemental 

comments which directly responded to 

the CEED’s comments on the WRAP 

program. The commenter stated that in 

its view, ‘‘the fact that the WRAP Annex 

(or, more precisely, its SO2 milestones) 

were established based on a groupBART approach does not taint the 

Annex, so long as the Annex is required 

by or satisfies (in whole or in part) the 

CAA’s reasonable progress requirements 


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60626 Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 

11Section 51.309(a) of the Regional Haze Rule, in 

requiring submission of an implementation plan for 

the 16 Class I areas covered by the GCTVC report, 

states that ‘‘[i]f a transport region State submits an 

implementation plan which is approved by EPA as 

meeting the requirements of this section, it will be 

deemed to comply with the requirements for 

reasonable progress for the period from approval of 

the plan to 2018.’’ (64 FR 35769). 

(or some other CAA or State 

requirement.’’ (Emphasis in original). 

The commenter also opined on the 

manner in which the WRAP program 

could be shown to satisfy reasonable 

progress requirements. First, the 

commenter cited the EPA’s discussion 

of the purpose of section 309 in the 

preamble to the 1999 Regional Haze 

Rule, as meeting the reasonable progress 

requirements for the 16 Class I areas 

addressed by the GCVTC (See 64 FR 

35749–51). Second, the commenter 

notes that it is the States’’, not EPA’s, 

obligation to demonstrate that the 

program satisfy reasonable progress 

requirements. In support of this, the 

commenter points to the provision in 

the proposed provision at section 

51.309(d)(2), requiring a visibility 

improvement projection in order to 

demonstrate that section 51.309 as a 

whole comprises reasonable progress for 

the 16 Class I areas on the Colorado 

Plateau. Therefore, the commenter 

asserts, if a ‘‘State demonstrates to EPA, 

as part of its section 51.309 SIP 

submittal, that the WRAP annex 

satisfies part or all of the reasonable 

progress requirement, the sourcespecific BART benchmark to be used in 

the ‘better than BART’ test can be 

established using a group BART 

approach.’’

Final Rule. Today’s rule does not ‘‘repromulgate’’ or ‘‘pre-approve’’ the 

stationary source SO2 trading program 

addressed by the WRAP Annex. Rather, 

we are amending the Regional Haze 

Rule to remove the requirement that 

States use a ‘‘group BART’’ benchmark 

for evaluating alternative programs and 

providing western States and tribes the 

opportunity to reconsider the 

milestones absent that invalid analytical 

requirement. The Regional Haze Rule 

makes clear that the WRAP States have 

the option of using source-by-source 

BART determinations to develop a 

BART benchmark against which to 

compare their backstop market trading 

program. Alternatively, if a WRAP State 

were to demonstrate as part of its SIP 

submittal that the backstop market 

trading program satisfies part or all of its 

reasonable progress requirement for the 

Class I areas at issue, then the 

regulations provide that the WRAP 

States could use a BART benchmark 

based on category-wide assumptions 

about control levels which could be 

expected to result from BART to 

demonstrate that the trading program 

makes greater reasonable progress than 

BART. In either case, a new 

demonstration is required, based on 

regulatory requirements and control 

technology factors as they currently 

exist, not as they were in 2000. 

Therefore the ‘‘Annex’’ milestones are 

not being ‘‘recycled.’’

We do agree that regulatory certainty 

and clarity are best served by specifying 

within the regulatory provisions the 

circumstances in which a State, 

including a State submitting a SIP under 

section 51.309, may use simplifying 

assumptions to estimate BART 

emissions reductions in establishing a 

BART benchmark. As discussed in 

section II of the preamble, we have 

amended section 51.308(e)(2)(i)(C) to 

clarify the methodologies for 

determining the BART benchmark. The 

new language codifies the approach, 

discussed in the proposal preamble, 

which may be used in the case of an 

emissions trading or other alternative 

program designed to meet a Federal or 

State requirement other than BART. The 

paragraph specifies that the CAA 

section 169A requirement to make 

reasonable progress may be considered 

such a requirement. 

Although a commenter argues that we 

are ‘‘recycling’’ the WRAP Annex, we 

are not determining at this time that a 

SIP with a backstop market trading 

program identical to that approved by 

EPA in 2003 would meet the 

requirements of the amended Regional 

Haze Rule. In other words, it is 

unnecessary at this time to address the 

CEED’s central argument that the 

backstop market trading program in the 

WRAP Annex cannot qualify as a BART 

alternative program designed to meet 

another CAA provision. If any SIPs are 

submitted under section 51.309, EPA 

will review the plans at that time based 

on the State’s submittal and any 

additional information adduced during 

the public comment period. 

We do note that EPA disagrees with 

the commenter that a WRAP State could 

not show that a stationary source market 

trading program similar to that in the 

WRAP Annex was designed to satisfy 

the reasonable progress requirements. 

Although, as the commenter pointed 

out, EPA did not provide an analysis in 

the proposal of how the milestones from 

2003 could contribute to reasonable 

progress should any States submit SIPs 

containing a trading program based on 

these milestones, the history of the 

program authorized under § 51.309 of 

the Regional Haze Rule suggests 

strongly that the stationary source 

program for SO2 was designed by the 

States and others in the GCVTC as a 

measure for obtaining reasonable 

progress. In the preamble to the 1999 

Regional Haze Rule, we stated: 

‘‘The EPA finds that the GCVTC actions to 

date address, or provide a mechanism to 

address, the statutory factors for assessing 

reasonable progress required by the CAA. 

The EPA is satisfied that the GCVTC’s 

strategies as set forth in section 51.309, when 

supplemented by the annex process 

discussed below, will provide for ‘reasonable 

progress’ toward the national visibility goal 

for the 16 parks and wilderness areas 

addressed by the GCVTC.’’ [64 FR 35749 

emphasis added]. 

In elaborating on the Annex process, 

we noted that the haze rule contained a 

provision calling for the submission of 

an Annex to the GCVTC report ‘‘for the 

purpose of completing the program 

requirements to meet reasonable 

progress under the CAA, including 

submission of a complete long-term 

strategy and addressing the BART 

requirement for the 16 Class I areas on 

the Colorado Plateau.’’ [64 FR 35756 

emphasis added]. Thus, from the 

beginning of the process, it is clear that 

EPA believed that satisfying the BART 

requirement was a subsidiary 

component of the reasonable progress 

requirement, but that the purpose of the 

Annex and of section 309 generally was 

to satisfy the overall reasonable progress 

requirements of western States and 

Tribes with respect to the 16 Class 1 

areas on the Colorado Plateau.11 Based 

on this, in EPA’s opinion, a WRAP State 

could demonstrate in a SIP submittal 

that a stationary source program similar 

to the WRAP Annex was designed to 

make reasonable progress. However, as 

one commenter noted, such an 

obligation belongs to the State, ‘‘and the 

time for the State to provide that 

justification is when the State submits a 

section 51.309 SIP that contains the 

WRAP Annex’s provisions.’’ In short, 

whether any SIPs submitted several 

years from now under section 51.309 by 

the WRAP States meet the minimum 

requirements set forth in EPA’s 

regulations will depend on the 

submission made by the States at that 

time. 

We also disagree with the comments 

that EPA’s approval of the WRAP Annex 

in 2003 was not rational as the trading 

program had not been shown to produce 

a ‘‘humanly perceptible’’ degree of 

visibility improvement. We determined 

in the 1999 rule that the analysis 

conducted by the GCVTC was the 

functional equivalent of the reasonable 

progress analysis required under section 

51.308. Under section 308, States must 

establish reasonable progress goals by 

considering the uniform rate of progress 


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Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 60627 

(in deciviews) to natural conditions in 

2064 (i.e. the ‘‘glide path’’), and the 

statutory reasonable progress factors 

contained in CAA 169A(g)(1). If the 

state adopts a slower rate of progress 

than the glide path, it must demonstrate 

that this slower rate is justified based on 

the statutory factors. In approving the 

GCVTC analysis as comparable to such 

an analysis, we found that the GCVTC 

had demonstrated that a faster rate of 

progress was not feasible, considering 

the costs and other factors. This 

determination does not necessarily 

reflect what would be expected in other 

parts of the country, as it is unique to 

the situation of the Colorado Plateau, in 

terms of air quality, pollutant 

concentrations, source location, and 

meteorology. 

In addition, the commenter’s 

argument ignores the fact that there are 

two elements of national visibility goals 

established by Congress in CAA 

169A(a)(1): Preventing future 

impairment as well as remedying 

existing impairment. It cannot be 

disputed that a program that prevents 

degradation for the first long-term 

planning period constitutes reasonable 

progress towards the goal of preventing 

any future impairment. In other words, 

holding the line against visibility 

degradation for the first 10-year strategy 

period is reasonable progress towards 

holding the line indefinitely. 

Geographic Enhancements 

Proposal. The proposed rule made no 

mention of ‘‘geographic enhancements’’

because no changes were intended for 

the relevant provisions. The term 

geographic enhancement refers to a 

‘‘method, procedure, or process to allow 

a broad regional strategy, such as a 

milestone or backstop market trading 

program designed to achieve greater 

reasonable progress than BART for 

regional haze, to accommodate BART 

for reasonably attributable impairment.’’

See 40 CFR 51.301 and 51.309(b)(7). As 

explained in the preamble to the 1999 

Regional Haze Rules, the purpose of this 

provision is to allow a market-based 

system to accommodate actions taken 

under the ‘‘reasonably attributable’’

BART provisions at section 51.302 to 

address ‘‘hot spot’’ issues. Section 

51.308(e)(2)(v) provides that States may, 

at their option, include geographic 

enhancements in an emissions trading 

program or other alternative measure. 

We proposed changes to 

§ 51.308(e)(2)(i), (ii), and (vi), but not to 

paragraph (e)(2)(v). In addition, 

§ 51.309(f)(4) had contained a provision 

for optional geographic enhancements, 

similar to that in § 51.308(e)(2)(v). 

However, as explained in the preamble 

of the August 1 proposal, the ‘‘Annex’’

mechanism embodied in § 309(f) is no 

longer necessary or appropriate. We 

therefore proposed to repeal section 

309(f), while incorporating certain stillrelevant provisions into § 309(d)(4). 

Comments. One commenter requested 

a clarification that the option of 

geographic enhancements is preserved 

for the WRAP program through the 

cross-reference to § 51.308(e)(2) that 

appeared in proposed § 51.309(d)(4)(i). 

Final Rule. We agree with the 

commenter that geographic 

enhancements are retained as an option 

under the WRAP program. The 

geographic enhancement provision is 

contained within § 51.308(e)(2), the 

general requirements for trading 

programs or other alternative measures 

in lieu of BART. The geographic 

enhancement provision within 

§ 51.308(e)(2) provides a mechanism 

which could affect the milestones. The 

proposed rule relied upon the fact that 

§ 51.309(d)(4) would require that the 

WRAP stationary source milestones 

comply with the provisions of 

§ 51.308(e)(2), which include the 

geographic enhancement provision. 

However, for additional clarity, we have 

added a geographic enhancement 

provision specific to the WRAP program 

in § 51.309(d)(4)(v). 

Tribal Issues 

Proposal. Throughout the preamble to 

the proposed rule, we referred to Tribes 

along with States in recognition that 

tribes may be delegated authority to 

implement CAA programs, as provided 

in section 301(d) of the CAA and the 

Tribal Authority Rule (§§ 49.1 through 

49.11). We proposed to retain, in the 

text of the rule at proposed § 51.309(c), 

the provision that Indian Tribes may 

submit implementation plans after the 

proposed deadline of December 17, 

2007. 

Comments. One commenter included 

two issues related to Tribes. First, the 

commenter stated that participation in a 

program under this rule would not be ‘‘a 

trivial exercise for any Tribal program to 

accomplish given most tribal programs 

lack the staff and expertise of state air 

programs,’’ and requested that EPA 

recognize this reality. The second 

comment was specifically focused on 

the Tribal allowance set-aside provision 

of the former ‘‘Annex’’ program. The 

commenter noted that the rule as 

proposed did not contain a specific 

requirement for a Tribal set-aside, 

presumably due to the fact that the 

Annex rule had been vacated and that 

EPA was therefore aware of the need to 

avoid the inclusions of ‘‘provisions of 

the Annex rule that were directly or 

indirectly dependent or related to the 

specific quantitative milestones 

contained in the Annex.’’ The 

commenter noted that in the 2003 

approval of the WRAP Annex, EPA had 

specified that the Tribal set-aside 

provision was the one element of the 

allocation methodology that was 

appropriate for treatment in the Federal 

regulation (rather than in SIPs and 

Tribal implementation plans (TIPs)). 

The commenter therefore requested that 

EPA clarify ‘‘what expectations it has 

regarding the consistency of tribal set 

aside provisions between the section 

309 SIPs submitted by various states, 

and what role, if any, EPA would play 

in assuring implementation of such 

provisions.’’

Final Rule. The EPA agrees that 

regulatory activities such as BART 

determinations and the development of 

trading programs is not by any means 

trivial and would be difficult to perform 

or participate in with the small staffs 

and limited resources typical of many 

nascent Tribal air programs. 

Fortunately, there are few BART-eligible 

sources within Indian country across 

the nation. Also, EPA has provided 

funding as well as technical and other 

forms of support to the five RPOs 

established to serve both State and 

Tribal needs in regional haze planning. 

EPA has an ongoing commitment to 

insure that tribal interests are addressed 

within the RPO process. Also, EPA is 

committed to fulfilling its responsibility 

to implement CAA provisions in Indian 

country as necessary and appropriate, in 

consultation with any affected Tribes. 

The EPA agrees with the commenter’s 

assessment that the reason a tribal 

allowance set-aside was not included in 

the proposal was that the set-aside 

provision in the Annex was integrally 

related to the milestones previously 

submitted. The Tribal set-aside was 

developed voluntarily by the WRAP and 

not in response to any CAA 

requirement. Having been so developed, 

EPA determined at the time of the 

Annex rule approval that it was 

appropriate for inclusion within section 

309, in order to provide an efficient 

mechanism to implement the set-aside. 

Given that the CEED v. EPA decision 

necessitates that States and Tribes be 

given the opportunity to revisit the 

milestones, that there is no CAA 

provision that requires a Tribal setaside, and that the details of the 

WRAP’s emissions trading program will 

be developed directly in SIPs and TIPs 

without the intermediary step of 

codifying detailed requirements in an 

Annex-like Federal rule, the EPA 

believes it would be inappropriate to 

attempt to mandate a Tribal allowance 


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60628 Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 

set-aside at this time. However, the EPA 

does continue to encourage States and 

Tribes in the WRAP as well as 

elsewhere to develop mechanisms to 

address Tribal interests and concerns, 

such as allowance set-asides. We will 

review SIPs and TIPs submitted under 

section 309 to insure that the allocation 

methodologies, including any Tribal 

provisions, are consistent among 

jurisdictions and will provide the 

certainty and regularity necessary for a 

functioning market. What other role, if 

any, the EPA will play in assuring the 

implementation of any Tribal set-aside 

provisions is dependent in large part 

upon the nature of the program 

developed by participating states and 

Tribes—for example, whether the 

program would be administered by the 

EPA, States and Tribes, or a third-party 

contractor. 

Other Comments and Responses 

One commenter requested that EPA 

make explicit in the final rule that 

backstop trading programs are 

permissible under both §§ 51.309 and 

51.308 for SO2 and NOX. The 

commenter noted that the proposal 

preamble stated only that ‘‘nothing 

precludes states outside the 9-state 

region from incorporating elements of 

the GCVTC strategies into their SIPs.’’

While this would indicate that the 

section 309 program (including the 

backstop trading program) could be 

expanded geographically, it does not 

address the question of whether the 

backstop approach could be utilized, 

either inside or outside the GCVTC 

region, for NOX as well as SO2. 

We wish to clarify here that a 

backstop trading program (i.e., a system 

of voluntary milestones backed by an 

automatically required cap and trade 

program in the event the milestones are 

exceeded) could qualify as an ‘‘other 

alternative measure’’ under 

§ 51.308(e)(2) as a BART substitute. This 

could be accomplished for any visibility 

impairing pollutant, on a pollutant-bypollutant basis. The key distinction 

between programs under §§ 51.308 and 

51.309 is that under § 51.309, the 

reasonable progress requirements for 

SO2, with respect to the 16 Class I areas 

on the Colorado plateau, have already 

been defined by the GCVTC. With 

respect to SO2 reductions to meet 

reasonable progress requirements at 

other Class I areas, and with respect to 

other pollutants such as NOX, the 

emission reductions requirements 

remain to be determined. This could be 

accomplished either according to the 

reasonable progress requirements of 

§ 51.308(d)(1), in the case of a program 

designed to meet reasonable progress 

goals; or through source-by-source 

BART determinations as described in 

this rule, for programs designed only to 

satisfy BART. Provided these 

requirements are met, it is acceptable for 

a State to use a backstop trading 

program under § 51.308. 

Finally, we note that there was an 

obvious omission in the proposed 

provisions regarding the comparison of 

actual emissions to the emissions 

milestones. Specifically, proposed 

§ 51.309(d)(4)(i) provided for the use of 

a 3-year rolling average of actual 

emissions for this purpose. This does 

not account for the fact that it is not 

possible to generate a 3-year average 

during the first two years of emission 

tracking. Therefore, the final rule 

provides that for the first 2 years, 

compliance with the milestones may be 

measured by a methodology of the 

States’ choosing, so long as all States in 

the program use the same methodology. 

After the first 2 years of the program, 

compliance with the annual milestones 

may be measured by comparing a 3-year 

rolling average of actual emissions with 

a rolling average of the emissions 

milestones for the same 3 years. 

IV. Statutory and Executive Order 

Reviews 

A. Executive Order 12866: Regulatory 

Planning and Review 

Under Executive Order (EO) 12866 

(58 FR 51735, October 4, 1993), this 

action is a ‘‘significant regulatory 

action’’ because it raises novel legal or 

policy issues arising out of legal 

mandates, the President’s priorities, or 

the principles set forth in the EO. 

Accordingly, EPA submitted this action 

to the Office of Management and Budget 

(OMB) for review under EO 12866 and 

any changes made in response to OMB 

recommendations have been 

documented in the docket for this 

action. 

Today’s rule provides States and 

interested Tribes with optional means, 

such as emissions trading programs, to 

comply with CAA requirements for 

BART. The rule requires that 

alternatives achieve greater ‘‘reasonable 

progress’’ towards CAA visibility goals 

than would source-by-source BART. By 

their nature, emissions trading programs 

are designed to achieve a given level of 

environmental improvement in the most 

cost-effective manner possible. 

Therefore, today’s rule will achieve at 

least as great a societal benefit as sourceby-source BART, at a social cost that is 

likely to be less than, or at worst equal 

to, the social costs of source-by-source 

BART. 

In the Regulatory Impact Analysis 

(RIA) for our recent promulgation of the 

source-by-source BART guidelines, we 

determined that the social costs of 

source-by-source BART for both EGUs 

and non-EGUs nationwide was between 

$0.3 and $2.9 billion (1999 dollars), 

depending on the level of stringency 

implemented by States and on the 

interest rate used. The human health 

benefits of BART, in contrast, ranged 

from $1.9 to $12 billion (1999 dollars), 

depending on the same variables. These 

figures do not include many other 

human health benefits that could not be 

quantified or monetized, including all 

benefits attributable to ozone reduction 

(the benefits were based on reductions 

in PM only). In addition, economic 

benefits due to visibility improvement 

in the southeastern and southwestern 

U.S. were estimated to be from $80 

million to $420 million. Finally, BART 

would also produce visibility benefits in 

other parts of the country, and nonvisibility ecosystem benefits, which 

were also not quantified. Therefore, the 

social benefits of BART far outweigh the 

social costs. 

It is not possible to perform an 

economic analysis of today’s rule 

because the actual parameters of any 

trading programs in lieu of BART will 

be determined by States and Tribes. 

However, because trading program 

alternatives would produce comparable 

overall benefits (in the course of 

satisfying the requirement to achieve 

greater ‘‘reasonable progress’’ towards 

visibility goals) and use market forces to 

reduce costs, the benefits of today’s rule 

would also far outweigh the costs. 

B. Paperwork Reduction Act 

This action does not add any new 

requirements involving the collection of 

information as defined by the 

Paperwork Reduction Act, 44 U.S.C. 

3501 et seq. This action does not impose 

any new collections that would require 

an amendment to the existing approved 

Information Collection Request (ICR). 

The OMB has approved the information 

collection requirements contained in the 

final Regional Haze regulations (64 FR 

35714, July 1, 1999) and has assigned 

OMB control number 2060–0421 (EPA 

ICR No. 1813.04). A copy of the OMB 

approved ICR may be obtained from 

Susan Auby, Collection Strategies 

Division; U.S. Environmental Protection 

Agency (2822T); 1200 Pennsylvania 

Ave., NW., Washington, DC 20460 or by 

calling (202) 566–1672. 

Burden means the total time, effort, or 

financial resources expended by persons 

to generate, maintain, retain, or disclose 

or provide information to or for a 

Federal agency. This includes the time 


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needed to review instructions; develop, 

acquire, install, and utilize technology 

and systems for the purposes of 

collecting, validating, and verifying 

information, processing and 

maintaining information, and disclosing 

and providing information; adjust the 

existing ways to comply with any 

previously applicable instructions and 

requirements; train personnel to be able 

to respond to a collection of 

information; search data sources; 

complete and review the collection of 

information; and transmit or otherwise 

disclose the information. An agency 

may not conduct or sponsor, and a 

person is not required to respond to a 

collection of information unless it 

displays a currently valid OMB control 

number. The OMB control numbers for 

EPA’s regulations are listed in part 9 

and 48 CFR chapter 15. 

C. Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA) 

generally requires an agency to prepare 

a regulatory flexibility analysis of any 

rule subject to notice and comment 

rulemaking requirements under the 

Administrative Procedure Act or any 

other statute unless the agency certifies 

that the rule will not have a significant 

economic impact on a substantial 

number of small entities. Small entities 

include small businesses, small 

organizations, and small governmental 

jurisdictions. 

For purposes of assessing the impacts 

of today’s proposed rulemaking on 

small entities, small entity is defined as: 

(1) A small business as defined by the 

Small Business Administration’s (SBA) 

regulations at 13 CFR 121.201; (2) a 

small governmental jurisdiction that is a 

government of a city, county, town, 

school district or special district with a 

population of less than 50,000; and (3) 

a small organization that is any not-forprofit enterprise which is independently 

owned and operated and is not 

dominant in its field. 

After considering the economic 

impacts of today’s rule on small entities, 

I certify that this action will not have a 

significant economic impact on a 

substantial number of small entities. 

This rule will not impose any 

requirements on small entities. This rule 

revises the provisions of the Regional 

Haze Rule governing alternative trading 

programs, and provides additional 

guidance to States, which are not 

defined as small entities. In addition, 

we did not receive any comments 

relating to potential impacts on small 

entities as a result of this rulemaking. 

D. Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (Public Law 104–4) 

(UMRA), establishes requirements for 

Federal agencies to assess the effects of 

their regulatory actions on State, local, 

and Tribal governments and the private 

sector. Under section 202 of the UMRA, 

2 U.S.C. 1532, EPA generally must 

prepare a written statement, including a 

cost-benefit analysis, for any proposed 

or final rule that ‘‘includes any Federal 

mandate that may result in the 

expenditure by State, local, and Tribal 

governments, in the aggregate, or by the 

private sector, of $100,000,000 or more 

* * * in any one year.’’ A ‘‘Federal 

mandate’’ is defined under section 

421(6), 2 U.S.C. 658(6), to include a 

‘‘Federal intergovernmental mandate’’

and a ‘‘Federal private sector mandate.’’

A ‘‘Federal intergovernmental 

mandate,’’ in turn, is defined to include 

a regulation that ‘‘would impose an 

enforceable duty upon State, local, or 

tribal governments,’’ section 

421(5)(A)(i), 2 U.S.C. 658(5)(A)(i), 

except for, among other things, a duty 

that is ‘‘a condition of Federal 

assistance,’’ section 421(5)(A)(i)(I). A 

‘‘Federal private sector mandate’’

includes a regulation that ‘‘would 

impose an enforceable duty upon the 

private sector,’’ with certain exceptions, 

section 421(7)(A), 2 U.S.C. 658(7)(A). 

Before promulgating an EPA rule for 

which a written statement is needed 

under section 202 of the UMRA, section 

205, 2 U.S.C. 1535, of the UMRA 

generally requires EPA to identify and 

consider a reasonable number of 

regulatory alternatives and adopt the 

least costly, most cost-effective, or least 

burdensome alternative that achieves 

the objectives of the rule. In addition, 

before EPA establishes any regulatory 

requirements that may significantly or 

uniquely affect small governments, 

including Tribal governments, it must 

have developed under section 203 of the 

UMRA a small government agency plan. 

The plan must provide for notifying 

potentially affected small governments, 

enabling officials of affected small 

governments to have meaningful and 

timely input in the development of EPA 

regulatory proposals with significant 

Federal intergovernmental mandates, 

and informing, educating, and advising 

small governments on compliance with 

the regulatory requirements. 

We believe that this rulemaking is not 

subject to the requirements of UMRA. 

For regional haze SIPs overall, it is 

questionable whether a requirement to 

submit a SIP revision constitutes a 

Federal mandate, as discussed in the 

preamble to the Regional Haze Rule (64 

FR 35761, July 1, 1999). However, 

today’s rule contains no Federal 

mandates (under the regulatory 

provisions of title II of the UMRA) for 

State, local or Tribal governments or the 

private sector. In addition, the program 

contained in section 51.309, including 

today’s revisions, is an optional 

program. Because the alternative trading 

programs under §§ 51.308 and 51.309 

are options that each of the States may 

choose to exercise, these revisions to 

§§ 51.308 and 51.309 do not establish 

any regulatory requirements that may 

significantly or uniquely affect small 

governments, including Tribal 

governments. The program is not 

required and, thus is clearly not a 

‘‘mandate.’’ Moreover, as explained 

above, today’s rule would reduce any 

regulatory burdens. Accordingly, this 

rule will not result in expenditures to 

State, local, and Tribal governments, in 

the aggregate, or the private sector, of 

$100 million or more in any given year. 

Thus, EPA is not obligated, under 

section 203 of UMRA, to develop a 

small government agency plan. 

E. Executive Order 13132: Federalism 

Executive Order 13132, entitled 

‘‘Federalism’’ (64 FR 43255, August 10, 

1999), 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 section 6(b) of 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 a regulation. 

Under section 6(c) of Executive Order 

13132, EPA may not issue a regulation 

that has federalism implications and 

that preempts State law, unless EPA 

consults with State and local officials 

early in the process of developing the 

regulation. 

We have concluded that today’s rule 

does not have federalism implications. 

It does not have substantial direct 

effects on the States, on the relationship 

between the national government and 


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60630 Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 

the States, or on the distribution of 

power and responsibilities among the 

various levels of government, as 

specified in Executive Order 13132. As 

described above, this rule contains 

revisions to sections 51.308 and 51.309 

of the Regional Haze Rule which will 

reduce any regulatory burden on the 

States. In addition, these are optional 

programs for States. These revisions to 

sections 51.308 and 51.309, accordingly, 

will not directly impose significant new 

requirements on State and local 

governments. Moreover, even if today’s 

revisions did have federalism 

implications, these revisions would not 

impose substantial direct compliance 

costs on State or local governments, nor 

would they preempt State law. Thus, 

Executive Order 13132 does not apply 

to this rule. 

Consistent with EPA policy, we 

nonetheless did consult with 

representatives of State and local 

governments in developing this final 

rule. This rule directly implements 

specific recommendations from the 

WRAP, which includes representatives 

from all the affected States. 

In addition, in the spirit of Executive 

Order 13132 and consistent with EPA 

policy to promote communications 

between EPA and State and local 

governments, EPA specifically solicited 

comment on today’s rule from State and 

local officials. 

F. Executive Order 13175: Consultation 

and Coordination With Indian Tribal 

Governments 

Executive Order 13175, entitled 

‘‘Consultation and Coordination with 

Indian Tribal Governments’’ (65 FR 

67249, November 6, 2000), requires EPA 

to develop an accountable process to 

ensure ‘‘meaningful and timely input by 

tribal officials in the development of 

regulatory policies that have tribal 

implications.’’ ‘‘Policies that have tribal 

implications’’ is defined in the 

Executive Order to include regulations 

that have ‘‘substantial direct effects on 

one or more Indian tribes, on the 

relationship between the Federal 

government and the Indian tribes, or on 

the distribution of power and 

responsibilities between the Federal 

government and Indian tribes.’’

Tribes who participate in this rule 

will experience an overall reduction in 

regulatory burden. Moreover, the 

§§ 51.308 (e)(2) and 51.309 programs are 

optional programs for Tribes. 

Accordingly, this rule would not have 

Tribal implications. In addition, this 

rule directly implements specific 

recommendations from the WRAP, 

which includes representatives of Tribal 

governments. Thus, although this rule 

does not have Tribal implications, 

representatives of Tribal governments 

have had the opportunity to provide 

input into development of the 

recommendations forming its basis. 

G. Executive Order 13045: Protection of 

Children From Environmental Health 

and Safety Risks 

Executive Order 13045: ‘‘Protection of 

Children from Environmental Health 

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. 

The EPA interprets Executive Order 

13045 as applying only to those 

regulatory actions that are based on 

health or safety risks, such that the 

analysis required under section 5–501 of 

the Order has the potential to influence 

the regulation. Similarly to the recently 

finalized source-specific BART 

revisions (70 FR 39104, July 6, 2005), 

this rule is not subject to Executive 

Order 13045 because it does not 

establish an environmental standard 

based on health or safety risks. 

Therefore, this rule does not involve 

decisions on environmental health or 

safety risks that may disproportionately 

affect children. We believe that the 

emissions reductions from the control 

strategies considered in this rulemaking 

will further improve air quality and will 

further improve children’s health. 

H. Executive Order 13211: Actions That 

Significantly Affect Energy Supply, 

Distribution or Use 

This rule is not subject to Executive 

Order 13211, ‘‘Actions that Significantly 

Affect Energy Supply, Distribution, or 

Use’’ (66 FR 28355, May 22, 2001) 

because it is not likely to have a 

significant adverse effect on the supply, 

distribution, or use of energy. This rule 

is not a ‘‘significant energy action,’’

because it will have less than a 1 

percent impact on the cost of energy 

production and does not exceed other 

factors described by OMB that may 

indicate a significant adverse effect. 

(See, ‘‘Guidance for Implementing E.O. 

13211,’’ OMB Memorandum 01–27 (July 

13, 2001) www.whitehouse.gov/omb/ 

memoranda/m01–27.html.) 

This rule provides an optional costeffective and less burdensome 

alternative to source-by-source BART as 

recently finalized (70 FR 39104, July 6, 

2005); we have already found that 

source-by-source BART is not likely to 

have a significant adverse effect on the 

supply, distribution, or use of energy. 

The 1999 Regional Haze Rule provides 

substantial flexibility to the States, 

allowing them to adopt alternative 

measures such as a trading program in 

lieu of requiring the installation and 

operation of BART on a source-bysource basis. This rule contains 

provisions governing these alternative 

measures, which provides an alternative 

to BART that reduces the overall cost of 

the regulation and its impact on the 

energy supply. 

I. National Technology Transfer 

Advancement Act 

Section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (‘‘NTTAA’’), Public Law No. 

104–113, section 12(d) (15 U.S.C. 272 

note) directs EPA to use voluntary 

consensus standards in its regulatory 

activities unless to do so would be 

inconsistent with applicable law or 

otherwise impractical. Voluntary 

consensus standards are technical 

standards (e.g., materials specifications, 

test methods, sampling procedures, and 

business practices) that are developed or 

adopted by voluntary consensus 

standards bodies. The NTTAA directs 

EPA to provide Congress, through OMB, 

explanations when the Agency decides 

not to use available and applicable 

voluntary consensus standards. 

This rulemaking does not involve 

technical standards. Therefore, EPA is 

not considering the use of any voluntary 

consensus standards. We specifically 

invited commenters to identify 

potentially-applicable voluntary 

consensus standards and to explain why 

such standards should be used in this 

regulation; no commenters responded. 

J. Executive Order 12898: Federal 

Actions To Address Environmental 

Justice in Minority Populations and 

Low-Income Populations 

Executive Order 12898 requires that 

each Federal agency make achieving 

environmental justice part of its mission 

by identifying and addressing, as 

appropriate, disproportionately high 

and adverse human health or 

environmental effects of its programs, 

policies, and activities on minorities 

and low-income populations. The 

requirements of Executive Order 12898 

have been previously addressed to the 

extent practicable in the RIA for the 

Regional Haze Rule (cited above), 


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Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 60631 

particularly in chapters 2 and 9 of the 

RIA. This rule makes no changes that 

would have a disproportionately high 

and adverse human health or 

environmental effect on minorities and 

low-income populations. 

K. Congressional Review Act 

The Congressional Review Act, 5 

U.S.C. 801 et seq., as added by the Small 

Business Regulatory Enforcement 

Fairness Act of 1996, generally provides 

that before a rule may take effect, the 

agency promulgating the rule must 

submit a rule report, which includes a 

copy of the rule, to each House of the 

Congress and to the Comptroller General 

of the United States. We will submit a 

report containing this rule and other 

required information to the U.S. Senate, 

the U.S. House of Representatives, and 

the Comptroller General of the United 

States prior to publication of the rule in 

the Federal Register. A major rule 

cannot take effect until 60 days after it 

is published in the Federal Register. 

This action is not a ‘‘major rule’’ as 

defined by 5 U.S.C. 804(2). This rule 

will be effective December 12, 2006. 

IV. Statutory Provisions and Legal 

Authority 

Statutory authority for today’s rule 

comes from sections 169A and 169B of 

the CAA (42 U.S.C. 7491 and 7492). 

These sections require EPA to issue 

regulations that will require States to 

revise their SIPs to ensure that 

reasonable progress is made toward the 

national visibility goals specified in 

section 169A. 

List of Subjects in 40 CFR Part 51 

Environmental protection, 

Administrative practice and procedure, 

Air pollution control, Intergovernmental 

relations, Lead, Nitrogen dioxide, 

Ozone, Particulate matter, Reporting 

and recordkeeping requirements, Sulfur 

oxides, Volatile organic compounds. 

Dated: October 5, 2006. 

Stephen L. Johnson, 

Administrator. 

■ For the reasons set forth in the 

preamble, part 51 of chapter I of title 40 

of the Code of Federal Regulations is 

amended as follows: 

PART 51—REQUIREMENTS FOR 

PREPARATION, ADOPTION, AND 

SUBMITTAL OF IMPLEMENTATION 

PLANS 

■ 1. The authority citation for part 51 

continues to read as follows: 

Authority: 23 U.S.C. 101; 42 U.S.C. 7401–

7671q. 

Subpart P—Protection of Visibility 

■ 2. Section 51.308 is amended as 

follows: 

■ a. By revising paragraph (e)(1)(ii)(C). 

■ b. By revising paragraphs (e)(2) 

introductory text and (e)(2)(i). 

■ c. By removing and reserving 

paragraph (e)(1)(ii). 

■ d. By adding paragraph (e)(2)(vi). 

■ e. By revising paragraph (e)(4). 

§ 51.308 Regional haze program 

requirements. 

* * * * * 

(e) * * * 

(1) * * * 

(ii) * * * 

(C) Exception. A State is not required 

to make a determination of BART for 

SO2 or for NOX if a BART-eligible 

source has the potential to emit less 

than 40 tons per year of such 

pollutant(s), or for PM10 if a BARTeligible source has the potential to emit 

less than 15 tons per year of such 

pollutant. 

* * * * * 

(2) A State may opt to implement or 

require participation in an emissions 

trading program or other alternative 

measure rather than to require sources 

subject to BART to install, operate, and 

maintain BART. Such an emissions 

trading program or other alternative 

measure must achieve greater 

reasonable progress than would be 

achieved through the installation and 

operation of BART. For all such 

emission trading programs or other 

alternative measures, the State must 

submit an implementation plan 

containing the following plan elements 

and include documentation for all 

required analyses: 

(i) A demonstration that the emissions 

trading program or other alternative 

measure will achieve greater reasonable 

progress than would have resulted from 

the installation and operation of BART 

at all sources subject to BART in the 

State and covered by the alternative 

program. This demonstration must be 

based on the following: 

(A) A list of all BART-eligible sources 

within the State. 

(B) A list of all BART-eligible sources 

and all BART source categories covered 

by the alternative program. The State is 

not required to include every BART 

source category or every BART-eligible 

source within a BART source category 

in an alternative program, but each 

BART-eligible source in the State must 

be subject to the requirements of the 

alternative program, have a federally 

enforceable emission limitation 

determined by the State and approved 

by EPA as meeting BART in accordance 

with section 302(c) or paragraph (e)(1) 

of this section, or otherwise addressed 

under paragraphs (e)(1) or (e)(4)of this 

section. 

(C) An analysis of the best system of 

continuous emission control technology 

available and associated emission 

reductions achievable for each source 

within the State subject to BART and 

covered by the alternative program. This 

analysis must be conducted by making 

a determination of BART for each 

source subject to BART and covered by 

the alternative program as provided for 

in paragraph (e)(1) of this section, 

unless the emissions trading program or 

other alternative measure has been 

designed to meet a requirement other 

than BART (such as the core 

requirement to have a long-term strategy 

to achieve the reasonable progress goals 

established by States). In this case, the 

State may determine the best system of 

continuous emission control technology 

and associated emission reductions for 

similar types of sources within a source 

category based on both source-specific 

and category-wide information, as 

appropriate. 

(D) An analysis of the projected 

emissions reductions achievable 

through the trading program or other 

alternative measure. 

(E) A determination under paragraph 

(e)(3) of this section or otherwise based 

on the clear weight of evidence that the 

trading program or other alternative 

measure achieves greater reasonable 

progress than would be achieved 

through the installation and operation of 

BART at the covered sources. 

(ii) [Reserved] 

* * * * * 

(vi) For plans that include an 

emissions trading program that 

establishes a cap on total annual 

emissions of SO2 or NOX from sources 

subject to the program, requires the 

owners and operators of sources to hold 

allowances or authorizations to emit 

equal to emissions, and allows the 

owners and operators of sources and 

other entities to purchase, sell, and 

transfer allowances, the following 

elements are required concerning the 

emissions covered by the cap: 

(A) Applicability provisions defining 

the sources subject to the program. The 

State must demonstrate that the 

applicability provisions (including the 

size criteria for including sources in the 

program) are designed to prevent any 

significant potential shifting within the 

State of production and emissions from 

sources in the program to sources 

outside the program. In the case of a 

program covering sources in multiple 

States, the States must demonstrate that 


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60632 Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 

the applicability provisions in each 

State cover essentially the same size 

facilities and, if source categories are 

specified, cover the same source 

categories and prevent any significant, 

potential shifting within such States of 

production and emissions to sources 

outside the program. 

(B) Allowance provisions ensuring 

that the total value of allowances (in 

tons) issued each year under the 

program will not exceed the emissions 

cap (in tons) on total annual emissions 

from the sources in the program. 

(C) Monitoring provisions providing 

for consistent and accurate 

measurements of emissions from 

sources in the program to ensure that 

each allowance actually represents the 

same specified tonnage of emissions and 

that emissions are measured with 

similar accuracy at all sources in the 

program. The monitoring provisions 

must require that boilers, combustion 

turbines, and cement kilns in the 

program allowed to sell or transfer 

allowances must comply with the 

requirements of part 75 of this chapter. 

The monitoring provisions must require 

that other sources in the program 

allowed to sell or transfer allowances 

must provide emissions information 

with the same precision, reliability, 

accessibility, and timeliness as 

information provided under part 75 of 

this chapter. 

(D) Recordkeeping provisions that 

ensure the enforceability of the 

emissions monitoring provisions and 

other program requirements. The 

recordkeeping provisions must require 

that boilers, combustion turbines, and 

cement kilns in the program allowed to 

sell or transfer allowances must comply 

with the recordkeeping provisions of 

part 75 of this chapter. The 

recordkeeping provisions must require 

that other sources in the program 

allowed to sell or transfer allowances 

must comply with recordkeeping 

requirements that, as compared with the 

recordkeeping provisions under part 75 

of this chapter, are of comparable 

stringency and require recording of 

comparable types of information and 

retention of the records for comparable 

periods of time. 

(E) Reporting provisions requiring 

timely reporting of monitoring data with 

sufficient frequency to ensure the 

enforceability of the emissions 

monitoring provisions and other 

program requirements and the ability to 

audit the program. The reporting 

provisions must require that boilers, 

combustion turbines, and cement kilns 

in the program allowed to sell or 

transfer allowances must comply with 

the reporting provisions of part 75 of 

this chapter, except that, if the 

Administrator is not the tracking system 

administrator for the program, 

emissions may be reported to the 

tracking system administrator, rather 

than to the Administrator. The reporting 

provisions must require that other 

sources in the program allowed to sell 

or transfer allowances must comply 

with reporting requirements that, as 

compared with the reporting provisions 

under part 75 of this chapter, are of 

comparable stringency and require 

reporting of comparable types of 

information and require comparable 

timeliness and frequency of reporting. 

(F) Tracking system provisions which 

provide for a tracking system that is 

publicly available in a secure, 

centralized database to track in a 

consistent manner all allowances and 

emissions in the program. 

(G) Authorized account representative 

provisions ensuring that the owners and 

operators of a source designate one 

individual who is authorized to 

represent the owners and operators in 

all matters pertaining to the trading 

program. 

(H) Allowance transfer provisions 

providing procedures that allow timely 

transfer and recording of allowances, 

minimize administrative barriers to the 

operation of the allowance market, and 

ensure that such procedures apply 

uniformly to all sources and other 

potential participants in the allowance 

market. 

(I) Compliance provisions prohibiting 

a source from emitting a total tonnage of 

a pollutant that exceeds the tonnage 

value of its allowance holdings, 

including the methods and procedures 

for determining whether emissions 

exceed allowance holdings. Such 

method and procedures shall apply 

consistently from source to source. 

(J) Penalty provisions providing for 

mandatory allowance deductions for 

excess emissions that apply consistently 

from source to source. The tonnage 

value of the allowances deducted shall 

equal at least three times the tonnage of 

the excess emissions. 

(K) For a trading program that allows 

banking of allowances, provisions 

clarifying any restrictions on the use of 

these banked allowances. 

(L) Program assessment provisions 

providing for periodic program 

evaluation to assess whether the 

program is accomplishing its goals and 

whether modifications to the program 

are needed to enhance performance of 

the program. 

* * * * * 

(4) A State that chooses to meet the 

emission reduction requirements of the 

Clean Air Interstate Rule (CAIR) by 

participating in one or more of the EPAadministered CAIR trading programs for 

SO2 and NOX need not require BART—

eligible EGUs subject to such trading 

programs in the State to install, operate, 

and maintain BART for the pollutants 

covered by such trading programs in the 

State. A State may choose to participate 

in the EPA-administered CAIR trading 

programs either by submitting a State 

implementation plan that incorporates 

the CAIR model trading rules in part 96 

of this chapter, and is approved, in 

accordance with § 51.123(o)(1) or (2) (for 

the NOX annual program) and (aa)(1) or 

(2) (for the NOX ozone season program) 

and § 51.124(o)(1) or (2) (for the SO2

program) or by remaining subject to the 

Federal implementation plan in part 97 

of this chapter (which may be modified 

by a State implementation plan 

approved in accordance with 

§§ 51.123(p) and (ee) and 51.124(r)). A 

State that chooses to participate in such 

trading programs may also adopt 

provisions, consistent with such trading 

programs, for a geographic enhancement 

to the program to address the 

requirement under § 51.302(c) related to 

BART for reasonably attributable 

impairment from the pollutants covered 

by the CAIR cap-and-trade programs. 

* * * * * 

■ 3. 51.309 is amended as follows: 

■ a. By revising paragraph (a). 

■ b. By revising paragraphs (b)(5) and 

(b)(7). 

■ c. By removing and reserving 

paragraphs (b)(9) through (b)(12). 

■ d. By revising paragraph (c). 

■ e. By revising paragraphs (d)(1) and 

(d)(4)(i) through (d)(4)(v). 

■ f. By adding paragraphs (d)(4)(vi) and 

(d)(4)(vii). 

■ g. By revising paragraph (d)(10) 

introductory text. 

■ h. By removing and reserving 

paragraph (f). 

■ i. By revising paragraph (g). 

■ j. By removing paragraph (h). 

§ 51.309 Requirements related to the 

Grand Canyon Visibility Transport 

Commission. 

(a) What is the purpose of this 

section? This section establishes the 

requirements for the first regional haze 

implementation plan to address regional 

haze visibility impairment in the 16 

Class I areas covered by the Grand 

Canyon Visibility Transport 

Commission Report. For the period 

through 2018, certain States (defined in 

paragraph (b) of this section as 

Transport Region States) may choose to 

implement the Commission’s 

recommendations within the framework 

of the national regional haze program 


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Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 60633 

and applicable requirements of the Act 

by complying with the provisions of this 

section. If a Transport Region State 

submits an implementation plan which 

is approved by EPA as meeting the 

requirements of this section, it will be 

deemed to comply with the 

requirements for reasonable progress 

with respect to the 16 Class I areas for 

the period from approval of the plan 

through 2018. Any Transport Region 

State electing not to submit an 

implementation plan under this section 

is subject to the requirements of 

§ 51.308 in the same manner and to the 

same extent as any State not included 

within the Transport Region. Except as 

provided in paragraph (g) of this 

section, each Transport Region State is 

also subject to the requirements of 

§ 51.308 with respect to any other 

Federal mandatory Class I areas within 

the State or affected by emissions from 

the State. 

(b) * * * 

(5) Milestone means the maximum 

level of annual regional SO2 emissions, 

in tons per year, for a given year, 

assessed annually, through the year 

2018, consistent with paragraph (d)(4) of 

this section. 

* * * * * 

(7) Base year means the year for 

which data for a source included within 

the program were used by the WRAP to 

calculate emissions as a starting point 

for development of the milestone 

required by paragraph (d)(4)(i) of this 

section. 

* * * * * 

(c) Implementation Plan Schedule. 

Each Transport Region State electing to 

submit an implementation plan under 

this section must submit such a plan no 

later than December 17, 2007. Indian 

Tribes may submit implementation 

plans after this deadline. 

(d) * * * 

(1) Time period covered. The 

implementation plan must be effective 

through December 31, 2018 and 

continue in effect until an 

implementation plan revision is 

approved by EPA in accordance with 

§ 51.308(f). 

* * * * * 

(4) * * * 

(i) Provisions for stationary source 

emissions of SO2. The plan submission 

must include a SO2 program that 

contains quantitative emissions 

milestones for stationary source SO2

emissions for each year through 2018. 

After the first two years of the program, 

compliance with the annual milestones 

may be measured by comparing a threeyear rolling average of actual emissions 

with a rolling average of the emissions 

milestones for the same three years. 

During the first two years of the 

program, compliance with the 

milestones may be measured by a 

methodology of the States’ choosing, so 

long as all States in the program use the 

same methodology. Compliance with 

the 2018 milestone shall be measured by 

comparing actual emissions from the 

year 2018 with the 2018 milestone. The 

milestones must provide for steady and 

continuing emissions reductions 

through 2018 consistent with the 

Commission’s definition of reasonable 

progress, its goal of 50 to 70 percent 

reduction in SO2 emissions from 1990 

actual emission levels by 2040, 

applicable requirements under the CAA, 

and the timing of implementation plan 

assessments of progress and 

identification of any deficiencies which 

will be due in the years 2013 and 2018. 

The milestones must be shown to 

provide for greater reasonable progress 

than would be achieved by application 

of BART pursuant to § 51.308(e)(2). 

(ii) Documentation of emissions 

calculation methods for SO2. The plan 

submission must include 

documentation of the specific 

methodology used to calculate SO2

emissions during the base year for each 

emitting unit included in the program. 

The implementation plan must also 

provide for documentation of any 

change to the specific methodology used 

to calculate emissions at any emitting 

unit for any year after the base year. 

(iii) Monitoring, recordkeeping, and 

reporting of SO2 emissions. The plan 

submission must include provisions 

requiring the monitoring, 

recordkeeping, and annual reporting of 

actual stationary source SO2 emissions 

within the State. The monitoring, 

recordkeeping, and reporting data must 

be sufficient to determine annually 

whether the milestone for each year 

through 2018 is achieved. The plan 

submission must provide for reporting 

of these data by the State to the 

Administrator and to the regional 

planning organization. The plan must 

provide for retention of records for at 

least 10 years from the establishment of 

the record. 

(iv) Criteria and Procedures for a 

Market Trading Program. The plan must 

include the criteria and procedures for 

conducting an annual evaluation of 

whether the milestone is achieved and, 

in accordance with paragraph (d)(4)(v) 

of this section, for activating a market 

trading program in the event the 

milestone is not achieved. A draft of the 

annual report evaluating whether the 

milestone for each year is achieved shall 

be completed no later than 12 months 

from the end of each milestone year. 

The plan must also provide for 

assessments of the program in the years 

2013 and 2018. 

(v) Market Trading Program. The 

implementation plan must include 

requirements for a market trading 

program to be implemented in the event 

that a milestone is not achieved. The 

plan shall require that the market 

trading program be activated beginning 

no later than 15 months after the end of 

the first year in which the milestone is 

not achieved. The plan shall also 

require that sources comply, as soon as 

practicable, with the requirement to 

hold allowances covering their 

emissions. Such market trading program 

must be sufficient to achieve the 

milestones in paragraph (d)(4)(i) of this 

section, and must be consistent with the 

elements for such programs outlined in 

§ 51.308(e)(2)(vi). Such a program may 

include a geographic enhancement to 

the program to address the requirement 

under § 51.302(c) related to BART for 

reasonably attributable impairment from 

the pollutants covered under the 

program. 

(vi) Provision for the 2018 milestone. 

(A) Unless and until a revised 

implementation plan is submitted in 

accordance with § 51.308(f) and 

approved by EPA, the implementation 

plan shall prohibit emissions from 

covered stationary sources in any year 

beginning in 2018 that exceed the year 

2018 milestone. In no event shall a 

market-based program approved under 

§ 51.308(f) allow an emissions cap for 

SO2 that is less stringent than the 2018 

milestone, unless the milestones are 

replaced by a different program 

approved by EPA as meeting the BART 

and reasonable progress requirements 

established in § 51.308. 

(B) The implementation plan must 

provide a framework, including 

financial penalties for excess emissions 

based on the 2018 milestone, sufficient 

to ensure that the 2018 milestone will 

be met even if the implementation of the 

market trading program in paragraph 

(d)(4)(v) of this section has not yet been 

triggered, or the source allowance 

compliance provision of the trading 

program is not yet in effect. 

(vii) Provisions for stationary source 

emissions of NOX and PM. The 

implementation plan must contain any 

necessary long term strategies and 

BART requirements for stationary 

source PM and NOX emissions. Any 

such BART provisions may be 

submitted pursuant to either 

§ 51.308(e)(1) or ’51.308(e)(2). 

* * * * * 

(10) Periodic implementation plan 

revisions. Each Transport Region State 


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60634 Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Rules and Regulations 

must submit to the Administrator 

periodic reports in the years 2013 and 

2018. The progress reports must be in 

the form of implementation plan 

revisions that comply with the 

procedural requirements of §§ 51.102 

and 51.103. 

* * * * * 

(f) [Reserved] 

(g) Additional Class I areas. Each 

Transport Region State implementing 

the provisions of this section as the 

basis for demonstrating reasonable 

progress for mandatory Class I Federal 

areas other than the 16 Class I areas 

must include the following provisions 

in its implementation plan. If a 

Transport Region State submits an 

implementation plan which is approved 

by EPA as meeting the requirements of 

this section, it will be deemed to 

comply with the requirements for 

reasonable progress for the period from 

approval of the plan to 2018. 

(1) A demonstration of expected 

visibility conditions for the most 

impaired and least impaired days at the 

additional mandatory Class I Federal 

area(s) based on emissions projections 

from the long-term strategies in the 

implementation plan. This 

demonstration may be based on 

assessments conducted by the States 

and/or a regional planning body. 

(2) Provisions establishing reasonable 

progress goals and implementing any 

additional measures necessary to 

demonstrate reasonable progress for the 

additional mandatory Federal Class I 

areas. These provisions must comply 

with the provisions of § 51.308(d)(1) 

through (4). 

(i) In developing long-term strategies 

pursuant to § 51.308(d)(3), the State may 

build upon the strategies implemented 

under paragraph (d) of this section, and 

take full credit for the visibility 

improvement achieved through these 

strategies. 

(ii) The requirement under § 51.308(e) 

related to Best Available Retrofit 

Technology for regional haze is deemed 

to be satisfied for pollutants addressed 

by the milestones and backstop trading 

program if, in establishing the emission 

reductions milestones under paragraph 

(d)(4) of this section, it is shown that 

greater reasonable progress will be 

achieved for these additional Class I 

areas than would be achieved through 

the application of source-specific BART 

emission limitations under 

§ 51.308(e)(1). 

(iii) The Transport Region State may 

consider whether any strategies 

necessary to achieve the reasonable 

progress goals required by paragraph 

(g)(2) of this section are incompatible 

with the strategies implemented under 

paragraph (d) of this section to the 

extent the State adequately 

demonstrates that the incompatibility is 

related to the costs of the compliance, 

the time necessary for compliance, the 

energy and no air quality environmental 

impacts of compliance, or the remaining 

useful life of any existing source subject 

to such requirements. 

[FR Doc. 06–8630 Filed 10–12–06; 8:45 am] 

BILLING CODE 6560–50–P 


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