```

[Federal Register Volume 72, Number 49 (Wednesday, March 14, 2007)]
[Proposed Rules]
[Pages 11812-11817]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-4665]

========================================================================
Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

========================================================================


Federal Register / Vol. 72, No. 49 / Wednesday, March 14, 2007 / 
Proposed Rules

[[Page 11812]]

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[Docket No. EPA-R02-OAR-2006-0162; FRL-8287-4]

Approval and Promulgation of Implementation Plans; Implementation 
Plan Revision; State of New Jersey

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Environmental Protection Agency (EPA) proposes to approve 
a request from the State of New Jersey to revise its State 
Implementation Plan (SIP) for ozone to incorporate state-adopted 
amendments to Subchapter 19 ``Control and Prohibition of Air Pollution 
from Oxides of Nitrogen'' and related amendments to Subchapter 16 
``Control and Prohibition of Air Pollution by Volatile Organic 
Compounds.'' The amendments relate to the control of oxides of nitrogen 
(NOX) emissions from stationary industrial sources. This SIP 
revision consists of control measures needed to meet the shortfall in 
emission reductions in New Jersey's 1-hour ozone attainment 
demonstration SIP as identified by EPA.
    The intended effect of this proposed rule is to approve the state 
control strategy, which will result in emission reductions that will 
help achieve attainment of the national ambient air quality standards 
for ozone required by the Clean Air Act (the Act).

DATES: Comments must be received on or before April 13, 2007.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R02-
OAR-2006-0162, by one of the following methods:
    www.regulations.gov: Follow the on-line instructions for 
submitting comments.
     E-mail: [email protected].
     Fax: 212-637-3901.
     Mail: Raymond Werner, Chief, Air Programs Branch, U.S. 
Environmental Protection Agency, Region 2 Office, 290 Broadway, 25th 
Floor, New York, New York 10007-1866.
     Hand Delivery: Raymond Werner, Chief, Air Programs Branch, 
U.S. Environmental Protection Agency, Region 2 Office, 290 Broadway, 
25th Floor, New York, New York 10007-1866. Hand deliveries are only 
accepted during the Regional Office's normal hours of operation. The 
Regional Office's official hours of business are Monday through Friday, 
8:30 to 4:30, excluding Federal holidays.
    Instructions: Direct your comments to Docket ID No. EPA-R02-OAR-
2006-0162. EPA's policy is that all comments received will be included 
in the public docket without change and may be made available online at 
www.regulations.gov, including any personal information provided, 
unless the comment includes information claimed to be Confidential 
Business Information (CBI) or other information whose disclosure is 
restricted by statute. Do not submit information that you consider to 
be CBI or otherwise protected through www.regulations.gov or e-mail. 
The www.regulations.gov website is an ``anonymous access'' system, 
which means EPA will not know your identity or contact information 
unless you provide it in the body of your comment. If you send an e-
mail comment directly to EPA without going through www.regulations.gov, 
your e-mail address will be automatically captured and included as part 
of the comment that is placed in the public docket and made available 
on the Internet. If you submit an electronic comment, EPA recommends 
that you include your name and other contact information in the body of 
your comment and with any disk or CD-ROM you submit. If EPA cannot read 
your comment due to technical difficulties and cannot contact you for 
clarification, EPA may not be able to consider your comment. Electronic 
files should avoid the use of special characters, any form of 
encryption, and be free of any defects or viruses. For additional 
information about EPA's public docket visit the EPA Docket Center 
homepage at http://www.epa.gov/epahome/dockets.htm.

FOR FURTHER INFORMATION CONTACT: Anthony (Ted) Gardella 
[email protected] at the Air Programs Branch, U.S. Environmental 
Protection Agency, Region 2 Office, 290 Broadway, 25th Floor, New York, 
New York 10007-1866, telephone number (212) 637-4249, fax number (212) 
637-3901.
    Copies of the New Jersey submittals are available at the following 
addresses for inspection during normal business hours:
    Air Programs Branch, U.S. Environmental Protection Agency, Region 2 
Office, 290 Broadway, 25th Floor, New York, New York 10007-1866.
    New Jersey Department of Environmental Protection, Office of 
Energy, Bureau of Air Quality Planning, 401 East State Street, CN027, 
Trenton, New Jersey 08625.

SUPPLEMENTARY INFORMATION: For detailed information on New Jersey's SIP 
revisions see the Technical Support Document (TSD), prepared in support 
of today's proposed action. A copy of the TSD is available upon request 
from the EPA Regional Office listed in the ADDRESSES section or it can 
be viewed at www.regulations.gov.
    The following table of contents describes the format for this 
notice:

I. EPA's Proposed Action
    A. What Action Is EPA Proposing Today?
    B. Why Is EPA Proposing This Action?
    C. What Are the Clean Air Act Requirements for NOX 
RACT?
    D. What Were the Clean Air Act Requirements for Attainment of 
the 1-Hour Ozone Standard?
    E. When Was New Jersey's Additional NOX RACT 
Requirement Proposed and Adopted?
    F. What Is EPA's Evaluation of New Jersey's Submittal?
II. Conclusion
III. Statutory and Executive Order Reviews

I. EPA's Proposed Action

A. What Action Is EPA Proposing Today?

    EPA proposes to act on a New Jersey submission that includes a new 
rule and amendments to Subchapter 19 ``Control and Prohibition of Air 
Pollution from Oxides of Nitrogen''; Subchapter 16 ``Control and 
Prohibition of Air Pollution by Volatile Organic Compounds''; 
Subchapter 8 ``Permits and Certificates for Minor Facilities (and Major 
Facilities Without an Operating Permit)''; and Subchapter 22 
``Operating Permits.''
    Except for certain Open Market Emissions Trading (OMET) Program 
provisions in Subchapters 8, 16, and 19,

[[Page 11813]]

and compliance dates beyond November 15, 2007 for repowering and 
innovative control technology, as discussed later in this notice, EPA 
proposes to approve, as revisions to the New Jersey ozone SIP, the 
state-adopted amendments to Subchapter 19 and Subchapter 16, each 
adopted by New Jersey on September 8, 2005, and submitted to EPA on 
December 16, 2005. EPA is currently reviewing past amendments to 
Subchapter 8 and will address the approvability of all Subchapter 8 
amendments at the same time in a future action. Subchapter 22 is New 
Jersey's operating permit rule that was separately approved under title 
V of the Clean Air Act and therefore Subchapter 22 should not have been 
submitted as a SIP revision. EPA has reviewed the new amendments to 
Subchapter 22 and will formally respond to New Jersey with a letter.
    New Jersey amended Subchapter 19 to reduce additional emissions of 
NOX in response to emission reduction shortfalls, identified 
by EPA (64 FR 70380, December 16, 1999), for attainment of New Jersey's 
1-hour ozone standard. New Jersey amended Subchapter 16 to be 
consistent with amendments to Subchapter 19. Except for certain 
provisions discussed later in this notice, EPA proposes that New 
Jersey's state-adopted Subchapters 16 and 19 are fully approvable as a 
SIP-strengthening measure for New Jersey's ground level ozone SIP. The 
amendments to Subchapters 16 and 19 in New Jersey's submittal meet New 
Jersey's commitment by adopting control measures for additional 
emission reductions to attain the 1-hour ozone standard and close the 
shortfall. Therefore, EPA will not proceed with the May 27, 2004 (69 FR 
30249) proposed Finding of Failure to Implement.

B. Why Is EPA Proposing This Action?

    EPA is proposing this action to:
     Give the public the opportunity to submit comments on 
EPA's proposed action;
     Approve a control measure which reduces NOX 
emissions, a precursor of ozone formation, to help attain the national 
ambient air quality standards for ozone;
     Fulfill New Jersey's and EPA's requirement under the Act; 
and
     Make New Jersey's regulations for additional emission 
reductions federally enforceable and available for emission reduction 
credit in the SIP.

C. What Are the Clean Air Act Requirements for NOX RACT?

    The Act requires certain states to develop reasonably available 
control technology (RACT) regulations for major stationary sources of 
NOX and to provide for their implementation as soon as 
practicable but, under the 1-hour ozone standard, no later than May 31, 
1995. New Jersey amended Subchapter 19, the State's NOX RACT 
regulation, to achieve the needed additional NOX reductions. 
Under the Act, the definition of major stationary source is based on 
the tons per year (tpy) of air pollution a source emits and the quality 
of the air in the area in which the source is located. In ozone 
transport regions, defined as attainment/unclassified areas as well as 
marginal and moderate ozone nonattainment areas, if a major stationary 
source of NOX emits or has the potential to emit 100 tpy or 
more of NOX, it is subject to the requirements of a moderate 
nonattainment area. New Jersey is within the Northeast ozone transport 
region, established by section 184(a) of the Act. In New Jersey, 
pursuant to Sec.  19.1 of Subchapter 19, a major stationary source for 
NOX emits or has the potential to emit 25 tpy, the level set 
for severe ozone nonattainment areas. Consequently, under the 1-hour 
ozone standard, all sources of NOX that emit or have the 
potential to emit 25 tpy within New Jersey were required to implement 
RACT no later than May 31, 1995.
    In July 1997, EPA promulgated a revised national ambient air 
quality standard for ozone of 0.08 parts per million (ppm). The 
standard was based on a three-year average of the annual fourth-highest 
daily maximum 8-hour average ozone concentrations measured at each 
monitor within an area. On April 30, 2004 (69 FR 23857), EPA 
established air quality designations and classifications for every area 
in the United States, including New Jersey, for the 8-hour ozone 
standard. In the April 2004 rule, EPA designated the entire state of 
New Jersey as nonattainment and classified New Jersey as a Subpart 2/
moderate area, effective June 15, 2004. The April 2004 rule also 
provided that one year from the effective date of an area's 8-hour 
ozone standard designation, the 1-hour ozone standard would no longer 
apply (i.e., would be revoked) for that area. In December 2006, the 
United States Court of Appeals for the District of Columbia Circuit 
vacated the April 2004 rule. S. Coast Air Quality Management Dist. v. 
EPA, 2006 U.S. App. LEXIS 31451. The case is still in litigation, thus 
its resolution is unclear. Nonetheless, on February 4, 2002 (67 FR 
5152), EPA approved New Jersey's commitment to adopt NOX 
emission reductions by November 15, 2007 in order to close emissions 
shortfalls and attain the 1-hour ozone standard.

D. What Were the Clean Air Act Requirements for Attainment of the 1-
Hour Ozone Standard?

    Section 182 of the Act requires states to submit SIP revisions for 
areas classified as nonattainment for ozone and provides dates when the 
revisions are to be submitted to EPA by the states. The specific 
requirements vary depending upon the severity of the ozone problem. EPA 
classified the New York-Northern New Jersey-Long Island area and the 
Philadelphia-Wilmington-Trenton area severe nonattainment areas (NAA) 
under the 1-hour ozone standard. Under section 182 of the Act, severe 
ozone nonattainment areas were required to submit demonstrations of how 
they would attain the 1-hour ozone standard. As noted above, on 
February 4, 2002 (67 FR 5152), EPA approved New Jersey's 1-hour ozone 
attainment demonstration, which included New Jersey's commitment to 
adopt additional volatile organic compound (VOC) and NOX 
emission reductions to close the emissions shortfall.
    This proposal addresses the NOX reductions to which New 
Jersey committed. For the New York-Northern New Jersey-Long Island NAA, 
the deadline for attainment of the 1-hour ozone standard is November 
15, 2007. According to ambient air quality data collected since 2005, 
the Philadelphia-Wilmington-Trenton NAA is in attainment for the 1-hour 
ozone standard. Although ambient air quality monitors demonstrate 
attainment for the 1-hour ozone standard, the Philadelphia-Wilmington-
Trenton NAA has never been reclassified to attainment. As stated above, 
EPA has promulgated the 8-hour ozone standard, which, dependant upon 
the litigation mentioned above, may supersede the 1-hour ozone standard 
from the effective date of the 8-hour ozone designation. If the 1-hour 
ozone standard is considered to be revoked, the New York-Northern New 
Jersey-Long Island NAA is no longer required to attain the 1-hour ozone 
standard by November 15, 2007. In any event, New Jersey is still 
required to meet its commitment to reduce additional NOX 
emissions to close the emissions shortfall by November 15, 2007. The 
emission reductions provided by control measures in the amendments to 
Subchapter 19 will also be necessary

[[Page 11814]]

for attainment of the 8-hour ozone standard.
    The Ozone Transport Commission (OTC) developed model rules for 
potential control measures for achieving NOX reductions for 
a number of source categories and estimated the potential emission 
reduction benefits from implementing the model rules. The model rules 
were designed for use by states in developing their own regulations to 
close emission shortfalls. New Jersey used the OTC model rules for 
NOX reductions as the basis for the submission upon which 
EPA is now acting.

E. When Was New Jersey's NOX RACT Requirement Proposed and 
Adopted?

    New Jersey proposed NOX RACT rules and related 
requirements on September 20, 2004, accepted written comments on them 
until November 19, 2004, and held public hearings on them on October 
28, 2004. New Jersey adopted the amended NOX RACT and 
related requirements on September 8, 2005, and submitted them to EPA 
for approval as revisions to the SIP on December 16, 2005. On January 
25, 2006, EPA determined the submittal to be administratively and 
technically complete.

F. What Is EPA's Evaluation of New Jersey's Submittal?

    New Jersey previously submitted SIP revisions to Subchapter 19 to 
address the NOX RACT requirements, which EPA approved as SIP 
revisions on January 27, 1997 (62 FR 3806) and March 29, 1999 (64 FR 
14832). New Jersey also developed a NOX Budget Trading 
Program (Subchapter 31), which EPA approved on May 22, 2001 (66 FR 
28063). The current submission provides amendments that establish more 
stringent RACT limits for facilities that emit NOX. The 
following is a summary of EPA's evaluation of New Jersey's December 16, 
2005 SIP submittal consisting of amendments to Subchapters 16 and 19.
1. Subchapter 19
    New Jersey revised Subchapter 19 to require owners and operators to 
implement the following new requirements:
    Stationary reciprocating engines. The amended Subchapter 19, which 
has a compliance date of March 7, 2007, lowers the presumptive 
NOX emission limits and lowers the applicability threshold 
for existing stationary reciprocating engines (REs) used for generating 
electricity. These amendments apply regardless of whether the source is 
located at a facility classified as major for NOX. The 
previous rule that was approved into the SIP applied to any engine 
source category capable of producing an output of more than 500 brake 
horsepower (bhp) (370 kilowatts (kW)). The new NOX emission 
limits apply to the following: (1) An engine that has a rated power 
output of 148 kW (about 200 bhp) or greater; and (2) a group of two or 
more engines each of which has a rated power output of 37 kW (about 50 
bhp) or greater, but less than 148 kW, and whose total combined power 
output is 148 kW or greater; and (3) an engine capable of producing an 
output of 370 kW (500 bhp) or greater.
    The new NOX emission limits for these three categories 
of engines, expressed as grams NOX per bhp-hour (g/bhp-hr), 
range from 1.5 to 2.3 depending upon the type of engine and the fuel 
combusted, and will result in additional NOX reductions 
ranging from zero percent to 71 percent. The rule provides that lean-
burn engines that combust gaseous fuels must meet either a 
NOX emission limit of 1.5 g/bhp-hr or an emission limit 
equivalent to an 80 percent reduction from the uncontrolled 
NOX emission level. The rule also includes NOX 
emission limits for the following two new source categories: (1) Rich-
burn engines that combust liquid fuel and (2) lean-burn engines capable 
of combusting dual (gas and liquid) fuels.
    New Jersey also amended Subchapter 19 to apply to engines with a 
maximum rated power output of 37 kW or greater that are new or modified 
on or after March 7, 2007. New engines must meet a NOX 
emission limit of 0.90 g/bhp-hr; modified engines are to meet the same 
NOX emission limit as new engines or an emission limit that 
is equivalent to a 90 percent NOX reduction from the 
uncontrolled emission level.
    Pursuant to Sec.  19.3(f) of Subchapter 19, owners or operators of 
the category of engines mentioned above may comply by meeting the new 
presumptive NOX emission limits or by one of the following 
existing options: (1) An emissions averaging plan pursuant to 
Sec. Sec.  19.6 and 19.14; (2) an alternative maximum allowable 
emission limit pursuant to Sec.  19.13; (3) a plan for phased 
compliance through the use of repowering pursuant to Sec.  19.21; or 
(4) a plan for phased compliance through the use of innovative control 
technology pursuant to Sec.  19.23. In accordance with the phased 
compliance plan option, owners or operators planning to comply with a 
phased compliance plan must fully implement the plan by November 7, 
2009 and have begun to comply with interim control measures and other 
requirements by March 7, 2007. Pursuant to Sec.  19.20 of Subchapter 
19, New Jersey must approve of any phased compliance plan. Applications 
to implement the phased compliance plans were due to New Jersey by 
February 7, 2006.
    Each of the compliance options listed above are addressed below. 
First, any emissions averaging plan must be approved by New Jersey, 
however EPA approval is not required since the emissions averaging 
procedures of Subchapter 19.6 have already been approved by EPA into 
the New Jersey SIP. Second, any alternative maximum allowable emission 
limit must be approved by New Jersey and submitted for EPA approval as 
a SIP revision as provided in Sec.  19.13.
    Finally, the phased compliance plan options in Sec. Sec.  19.21 and 
19.23 would allow sources to comply with the NOX RACT 
requirements in 2009 which is beyond the November 15, 2007 attainment 
deadline for the New York-Northern New Jersey-Long Island NAA. Sources 
that implement these phased compliance plan options in 2009 would not 
help the New York-Northern New Jersey-Long Island NAA achieve the 
NOX reductions needed for attainment of the 1-hour ozone 
standard by the November 15, 2007 attainment date. For this reason, the 
new amended 2009 compliance date for phased compliance plan options is 
not acceptable to EPA. If the amendments to the phased compliance plan 
options had a compliance date prior to the start of the 2007 ozone 
season this would be acceptable to EPA.
    It should be noted that New Jersey received no applications for 
phased compliance plan options before New Jersey's application deadline 
of February 7, 2006. Therefore, the new amendments to the phased 
compliance plan options at Sec. Sec.  19.21 and 19.23 have no practical 
effect. Accordingly, EPA is not proposing to approve or disapprove 
these sections into the SIP. For the reasons stated above, EPA further 
recommends that New Jersey delete the new amendments to Sec. Sec.  
19.21 and 19.23 from Subchapter 19. These comments also apply to new 
amendments to Subchapter 19 that established phased compliance plan 
options for owners or operators of stationary combustion turbines and 
owners or operators of industrial/commercial/institutional boilers and 
other indirect heat exchangers.
    Pursuant to Sec.  19.8(f), effective either in 2005 or 2007, 
depending on the engine size, owners and operators of engines used for 
generating electricity, whether or not the engine is located at a major 
NOX facility or, having a

[[Page 11815]]

maximum rated output of at least 37 kW or greater, shall adjust the 
engine's combustion process in accordance with the procedures specified 
in Subchapter 19. While combustion process adjustment is expected to 
reduce emissions of NOX, New Jersey has indicated that it is 
not depending upon these reductions to meet the emissions shortfall.
    Stationary combustion turbines. New Jersey amended Subchapter 19 by 
lowering the presumptive NOX emission limits and by lowering 
the applicability threshold for existing stationary combustion 
turbines. The amendments provide that, effective March 7, 2007, the 
maximum gross heat input rate applicability threshold for stationary 
combustion turbines is 25 MM BTU/hr instead of 30 MM BTU/hr, as was the 
case in the previous State rule. Also, New Jersey changed the 
NOX emission limits from heat input based limits (pounds per 
MM BTU (Lb/MM BTU)) to production output based limits (pounds per 
megawatt-hour (Lb/MWh)). Output based limits encourage sources to 
improve plant operating efficiency and pollution prevention, such as 
clean energy supply, which result in reduced fuel consumption and 
reduce emissions of pollutants, including NOX. The new 
NOX emission limits for stationary combustion turbines are 
in Table 4 of Subchapter 19. For oil fired turbines, the new output 
based NOX limits are more stringent, by about 25 percent, 
than the previous input based NOX limits. For gas fired 
turbines, the new NOX emission limits are as stringent as 
the previous NOX emission limits. One exception is that 
owners or operators of NOX budget sources, regulated under 
Subchapter 31, shall continue to be subject to the current SIP-approved 
NOX emission limits provided in Tables 2 and 3 of Subchapter 
19.
    Pursuant to Sec.  19.5(d), owners or operators of stationary 
combustion turbines, with a maximum gross heat input rate of at least 
25 MM BTU/hr, have the option of complying with any one of the 
following: (1) The new presumptive output based NOX emission 
limits provided in Table 4 of Subchapter 19; (2) the alternative 
compliance options, in Sec.  19.3(f) of Subchapter 19, as described 
above, for stationary reciprocating engines; and (3) a SIP-approved 
compliance option pursuant to Sec.  19.5(c) of Subchapter 19, which 
requires the owner or operator to obtain New Jersey's approval of its 
application demonstrating an insufficient supply of water to the 
turbine suitable for NOX emission control and to establish 
that no commercially available dry-low NOX combustor 
suitable for use in the specific turbine. It should be noted that EPA 
believes that the reference in Sec.  19.5(d) to ``(c)1 through 5 
below'' is a typographical error. EPA believes that the reference 
should read ``(c)1 through 5 above,'' and that New Jersey should 
correct the error accordingly.
    New Jersey also amended Subchapter 19 to require an owner or 
operator of a turbine, with a maximum gross heat input rate of at least 
25 MM BTU/hr, to adjust the turbine's combustion process in accordance 
with the procedures specified in Subchapter 19, starting in either 2005 
or 2007, depending upon the turbine's heat input rate.
    Industrial/commercial/institutional boilers and other indirect heat 
exchangers. New Jersey amended Subchapter 19 by lowering certain 
presumptive NOX emission limits and by lowering the 
applicability threshold for annual combustion process adjustments for 
industrial/commercial/institutional (ICI) boilers and other indirect 
heat exchangers (IHE). The amendments provide that, effective March 7, 
2007, the NOX emission limits for natural gas fired ICI 
boilers or other IHEs that have a maximum gross heat input rate of at 
least 100 MM BTU/hr is lowered to 0.10 lb NOX/MM BTU from 
0.20 lb NOX/MM BTU and 0.43 lb NOX/MM BTU. The 
change represents a reduction in NOX emissions ranging from 
50 percent to almost 77 percent, depending upon whether the firing 
method type is tangential, face or cyclone. New Jersey did not revise 
the NOX emission limits for other size or type ICI boilers 
or other IHEs. The new NOX emission limits for ICI boilers 
and other IHEs are in provided Table 7 of Subchapter 19.
    As with owners and operators of stationary combustion turbines and 
stationary reciprocating engines, owners and operators of ICI boilers 
and other IHEs have the option of complying with either the new 
presumptive NOX emission limits or the alternative 
compliance options, pursuant to Sec.  19.3(f) of Subchapter 19, as 
described above for stationary reciprocating engines.
    New Jersey also amended Subchapter 19 by lowering the applicability 
threshold of 20 MM BTU/hr heat input rate for sources required to 
annually adjust their combustion process. The amendments provide that, 
effective March 7, 2007, the applicability threshold for such sources 
is 5 MM BTU/hr maximum gross heat input rate. This threshold applies 
regardless of whether the source is located at a facility classified as 
major for NOX. Effective in either 2007, 2008, or 2010, 
depending upon the source's heat input rate, owners or operators of 
such sources are required to adjust the combustion process in 
accordance with the procedures specified in Subchapter 19.
    Emergency generators. New Jersey amended Subchapter 19 by adding a 
new provision, Sec.  19.11, which requires owners and operators of 
emergency generators with a maximum rated output of 37 kW, to maintain 
detailed and specific records on site for five years whenever an 
emergency generator has been in use. In addition, New Jersey amended 
Sec.  19.2(d) by deleting the following two conditions for an emergency 
generator exemption from Subchapter 19: (1) 500 hours operating 
restriction over any consecutive twelve month period; and (2) potential 
to emit (PTE) of less than 25 tpy NOX emissions during an 
annual period of operation.
    EPA has determined that New Jersey's additional amendments to Sec.  
19.2(d), and to the definition of emergency generators in Sec.  19.1, 
clarify when emergency generators shall and shall not be used. These 
amendments combined with the new recordkeeping provisions in Sec.  
19.11 provide New Jersey and EPA with information for any enforcement 
action, if needed.
    During the public comment period, a citizen commented that the 
removal of the 500 hour emergency operation time limit made the PTE 
analysis and netting analysis for a source ambiguous. EPA's September 
1995 guidance entitled, ``Calculating Potential to Emit (PTE) for 
Emergency Generators,'' establishes the criteria for determining a 
source's PTE and recommends 500 hours as an appropriate default 
assumption for estimating the number of hours an emergency generator 
could be expected to operate under worst-case conditions. EPA's PTE 
guidance for emergency generators also states that alternative 
estimates can be made on a case-by-case basis where justified by the 
source owner or permitting authority.
    New Jersey deleted the 500 hour operating restriction for emergency 
generators from Subchapter 19 because it believed that ``hours of 
operation'' is not an appropriate criteria for defining an emergency 
generator. In a communication to EPA, New Jersey interpreted the EPA 
proposed rule ``Standards of Performance for Stationary Compression 
Ignition Internal Combustion Engines'' (70 FR 39869, July 11, 2005), as 
further justification for deletion of the 500 hour restriction. In a 
February 14, 2006 letter to New Jersey, EPA responded that New Jersey 
misinterpreted EPA's July 2005 proposed rule and that ``for purposes of

[[Page 11816]]

the NSR and title V programs New Jersey should continue as they have 
and permit emergency units at some amount of operation sufficiently 
large to cover emergencies (i.e., 500 hours per year). Malfunctions 
that may require the operation of the emergency units and that may 
exceed the 500 hours/year limit could be handled through enforcement 
discretion on a case-by-case basis, as appropriate.'' Therefore, PTE 
requirements for emergency generators should be included in New 
Jersey's operating permit regulations, i.e., Subchapters 8 and 22, and 
should include the provisions that were deleted from the current SIP 
approved Subchapter 19, i.e., (1) the 500 hour annual operational 
restriction, or some other appropriate operating period in accordance 
with EPA's September 1995 guidance, and (2) the exemption for sources 
with a PTE of less than 25 tpy NOX.
    While EPA proposes to approve the new emergency generator 
provisions, for rule consistency, EPA believes it appropriate, although 
not required, that New Jersey revise the currently adopted Subchapter 
19 to also include the emergency generator restrictions identified in 
the current SIP-approved Subchapter 19. EPA would consider new language 
within Subchapter 19 that would allow owners and operators to operate 
emergency generators without restriction to operating hours for special 
situations such as when the governor of New Jersey declared an 
emergency because of an unprecedented and unexpectedly long blackout or 
a force majeure event (like a severe hurricane).
    Open Market Emissions Trading (OMET) Program. In July 1996, New 
Jersey adopted amendments to Subchapter 19 for consistency with the 
state-adopted Subchapter 30, called the OMET Program. The OMET Program, 
and amendments to Subchapter 19, permitted a source regulated under 
Subchapter 19 to meet its NOX RACT emission requirements by 
purchasing discrete emission reduction credits (DERs). The DERs were 
generated by a source that reduced NOX emissions beyond its 
regulatory requirements. EPA and New Jersey identified a number of 
problems with the OMET Program. EPA withdrew its proposed conditional 
approval of the OMET Program on October 18, 2002 and New Jersey 
terminated Subchapter 30 on February 25, 2004. On April 5, 2004, New 
Jersey amended Subchapter 19, withdrew the OMET provisions adopted in 
July 1996, and replaced them with new provisions that included a 
compliance schedule for the affected OMET sources. The latter OMET 
compliance provisions are included in New Jersey's December 2005 SIP 
revision to EPA.
    EPA objected to the new OMET compliance schedule, and related 
compliance requirements for sources subject to NOX RACT 
regulation. The new OMET compliance schedule would allow sources to 
comply with the NOX RACT requirements of Subchapter 19 
beyond the May 31, 1995 compliance date deadline mandated by the Act. 
In a December 2005 SIP submittal letter, New Jersey committed to delete 
OMET from Subchapter 19, and from Subchapters 8 and 16. Therefore, EPA 
expects New Jersey, in future rulemaking, to delete the OMET-related 
provisions in Subchapters 8, 16 and 19, i.e., Sec. Sec.  8.3(o), 
8.20(b)(3), 16.1A(g), 16.1A(h), 19.3(g), 19.3(h), 19.27, and the 19.27 
Appendix, and is not approving them into the SIP.
    Additional amendments to Subchapter 19. New Jersey adopted a number 
of other amendments since EPA last approved amendments to Subchapter 19 
(64 FR 14832, March 29, 1999). Among other things, these amendments: 
(1) Revised terms and definitions that do not change the meaning or 
stringency of the provisions; (2) revised the due date for permit 
applications and submittals of NOX Control Plans, pursuant 
to Sec.  19.13, to February 7, 2006; (3) revised Sec. Sec.  19.2 and 
19.9 by deleting the applicability threshold of 25 tpy PTE 
NOX for asphalt plants, which made the provisions more 
stringent; (4) revised the ozone season closing date to September 30 to 
conform with the closing date provided in Subchapter 31, the 
NOX Budget Program; and (5) revised testing requirements to 
conform with certain new control measures for stationary reciprocating 
engines.
2. Subchapter 16
    The amendments to Subchapter 16 are administrative in nature and 
ensure consistency with the amendments to Subchapter 19. The amendments 
to Subchapter 16 include the following: (1) Revised terms and 
definitions that do not change the meaning or stringency of the 
provisions; (2) lowered applicability thresholds for the following 
source categories that are required to implement annual combustion 
adjustments: (a) Small boilers and IHEs, not used for generating 
electricity; (b) stationary combustion turbines; and (c) stationary 
reciprocating engines, if used to generate electricity; and (3) a 
revised definition and recordkeeping requirements for emergency 
generators.
3. Summary of EPA's Evaluation
    EPA expects that the revisions to Subchapter 19 will result in 
additional reductions in NOX emissions to help New Jersey 
meet the emissions reduction shortfall and attain the ozone standard. 
EPA evaluated New Jersey's SIP submittal and proposes to find 
Subchapters 16 and 19 approvable. However, as explained above, EPA 
takes no action on and expects New Jersey to delete: (1) All OMET 
provisions in Subchapters 8, 16 and 19; (2) the new amendments to 
phased compliance plan through repowering in Sec.  19.21; and (3) the 
new amendments to phased compliance plan through the use of innovative 
control technology in Sec.  19.23. The December 16, 2005 SIP submittal 
will strengthen New Jersey's SIP for reducing ground level ozone by 
providing additional NOX reductions beginning on March 7, 
2007.
    EPA completed a detailed analysis and evaluation to determine the 
approvability of New Jersey's December 16, 2005 SIP revision. EPA's 
evaluation of the SIP submittal is detailed in a document entitled 
``Technical Support Document--NOX RACT SIP Revision--State 
of New Jersey.'' A copy of that document is available, upon request, 
from the EPA Regional Office listed in the ADDRESSES section of this 
document or the Technical Support Document can be viewed at http://www.regulations.gov.

II. Conclusions

    EPA evaluated New Jersey's submittal for consistency with the Act, 
EPA regulations and EPA policy. The proposed new control measures will 
strengthen the SIP by providing additional NOX emission 
reductions. Accordingly, EPA is proposing to approve the revisions to 
Subchapter 19, and related revisions to Subchapter 16, as adopted on 
September 8, 2005, except that EPA is not acting, at this time, on OMET 
Program provisions in Subchapters 16 and 19 or the new amendments to 
phased compliance plans by repowering and innovative control technology 
in Sec. Sec.  19.21 and 19.23, respectively. EPA is not approving any 
dates that allow for NOX RACT compliance beyond May 31, 
1995, in general, and beyond May 1, 1999 for completion of repowering 
for sources that should have complied by the date required in the March 
29, 1999 EPA-approved SIP. In addition, at a later date, EPA will act 
on Subchapter 8, as adopted by New Jersey on September 8, 2005.
    With the adoption of Subchapter 19, New Jersey has fulfilled its 
obligation to

[[Page 11817]]

adopt all six control measures that New Jersey identified as necessary 
to attain the 1-hour ozone standard. Therefore, EPA will not proceed 
with the May 27, 2004 (69 FR 30249) proposed Finding of Failure to 
Implement.

III. Statutory and Executive Order Reviews

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
proposed action is not a ``significant regulatory action'' and 
therefore is not subject to review by the Office of Management and 
Budget. For this reason, this action is also not subject to Executive 
Order 13211, ``Actions Concerning Regulations That Significantly Affect 
Energy Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001). This 
action merely proposes to approve state law as meeting Federal 
requirements and imposes no additional requirements beyond those 
imposed by state law. Accordingly, the Administrator certifies that 
this proposed rule will not have a significant economic impact on a 
substantial number of small entities under the Regulatory Flexibility 
Act (5 U.S.C. 601 et seq.). Because this rule proposes to approve pre-
existing requirements under state law and does not impose any 
additional enforceable duty beyond that required by state law, it does 
not contain any unfunded mandate or significantly or uniquely affect 
small governments, as described in the Unfunded Mandates Reform Act of 
1995 (Pub. L. 104-4).
    This proposed rule also does not have tribal implications because 
it will not have a substantial direct effect on one or more Indian 
tribes, on the relationship between the Federal Government and Indian 
tribes, or on the distribution of power and responsibilities between 
the Federal Government and Indian tribes, as specified by Executive 
Order 13175 (65 FR 67249, November 9, 2000). This action also does not 
have Federalism implications because it does not have substantial 
direct effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government, as specified 
in Executive Order 13132 (64 FR 43255, August 10, 1999). This action 
merely proposes to approve a state rule implementing a Federal 
standard, and does not alter the relationship or the distribution of 
power and responsibilities established in the Clean Air Act. This 
proposed rule also is not subject to Executive Order 13045 ``Protection 
of Children from Environmental Health Risks and Safety Risks'' (62 FR 
19885, April 23, 1997), because it is not economically significant.
    In reviewing SIP submissions, EPA's role is to approve state 
choices, provided that they meet the criteria of the Clean Air Act. In 
this context, in the absence of a prior existing requirement for the 
State to use voluntary consensus standards (VCS), EPA has no authority 
to disapprove a SIP submission for failure to use VCS. It would thus be 
inconsistent with applicable law for EPA, when it reviews a SIP 
submission, to use VCS in place of a SIP submission that otherwise 
satisfies the provisions of the Clean Air Act. Thus, the requirements 
of section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (15 U.S.C. 272) do not apply. This proposed rule does not 
impose an information collection burden under the provisions of the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).

List of Subjects in 40 CFR Part 52

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

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

    Dated: March 6, 2007.
Alan J. Steinberg,
Regional Administrator, Region 2.
 [FR Doc. E7-4665 Filed 3-13-07; 8:45 am]
BILLING CODE 6560-50-P
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