1 SUPPORTING STATEMENT

ENVIRONMENTAL PROTECTION AGENCY

Federal Plan Requirements for Greenhouse Gas Emissions from Electric Utility Generating Units Constructed on or Before January 8, 2014; Model Tr ading Rules;

Amendments to Framework Regulations

July 2015
Part A of the Supporting Statement

1. Identification of the Information Collection

1(a) Title and Number of the Information Collection

“Federal Plan Requirements for Greenhouse Gas Emission s from Electric Utility Generating Units Constructed on or Before January 8, 2014.” A new information collection request (ICR) has been prepared in support of the guidelines b eing proposed. The EPA ICR

number is 2526.01 and OMB Control Number is 2060-New. This ICR was developed for the 3- year period following publication of the final rule.

1(b) Short Characterization/Abstract

Pursuant to Clean Air Act (CAA) section 111(d), the United States Environmental Protection Agency (EPA) is proposing a federal plan to im plement the greenhouse gas (GHG) emission guidelines (EGs) for affected fossil fuel-fired electric utility generating units (EGUs) operating in states that do not have approved state plans. The EPA is co-proposing rate-based and mass-based approaches to a federal plan to implement t he Clean Power Plan EGs. While establishing emission standards for affected EGUs that wo uld be directly enforceable against the owners and operators of the source, both proposed approache s would grant EGUs substantial flexibility in meeting their compliance obligations and s erve as model trading rules that states may adopt or tailor in designing their own plans.

The federal plan is an important measure to ensure that congressionally mandated emission standards under the authority of the CAA are im plemented. The proposed federal plan is related to, but separate from, the final EGs. The fi nal EGs proposed in June 2014 and finalized in August 2015 establish the best system of emission reducti on (BSER) for applicable fossil fuelfired EGUs and provide guidance and criteria for the develo pment of approvable state plans. The purpose of the proposed federal plan is to establish requireme nts directly applicable to a state’s

affected EGUs that meet the BSER in order to achieve re ductions in carbon dioxide (CO 2 ) emissions in the case where a state or other jurisdict ion does not submit an approvable plan.

These CO 2 reductions laid out in the final EGs will be equivalent, whether implemented through a state plan or a federal plan.

The EPA is also proposing certain enhancements to the pro cess and timing for state submittals and EPA action in the section 111(d) framework r egulations of 40 CFR 60 Subpart B (these proposals are not a part of the federal plan or model trading rules). These changes would be applicable under the Clean Power Plan and other CAA section 111(d) rules. These changes clarify the availability of certain procedural mechanism s similar to those available under section 110 (such as calls for plan revisions and the availability o f “conditional approvals,” etc.). They2

also extend the deadlines for EPA action, in part to con form with the timelines in the EGs. These changes do not alter the timelines for state action un der the EGs and do not alter the submission requirements established in the EGs.

Potential respondents to this ICR are the owners or oper ators or existing fossil fuel-fired EGUs that were in operation or had commenced constructio n on or before January 8, 2014. This proposed action would impose minimal new information colle ction burden on affected EGUs beyond the information those affected EGUs would already be subject to under the authorities of CAA parts 75 (Continuous Emission Monitoring) and 98 (Mandator y Greenhouse Gas Reporting). During the first three years after final rul e promulgation, the only respondent activity required by the proposal is to read and understand the rule. T he Office of Management and Budget (OMB) has previously approved the information collecti on requirements contained in the existing 40 CFR parts 75 and 98 regulations under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned OMB control num bers 2060-0626 and 2060-0629, respectively. There are no new information collection costs for th ese affected sources during the first three years, as the information required for the se sources by the guidelines is already collected and reported by other regulatory programs during this pe riod.

This proposed rule does not directly impose specific requireme nts on state and U.S. territory governments or on tribal governments that hav e affected EGUs located in their areas. However, the proposed rule could result in burden for an implementation agency associated with these entities in the event that it seeks and is given delegated authority to enforce the rulemaking. Although granting delegated authority to an implementation a gency is possible, the agency does not have any information that could be used to develop a cos t estimate for the potential burden to state, territory, and tribal implementation agencies ov er the 3-year period associated with this

ICR. We will reevaluate the burden on these entities ba sed on the public comments and data received in response to the proposed action.

2. Need for and Use of the Collection

2(a) Need/Authority for the Collection

Section 111(d)(2) of the CAA, 42 U.S.C. 7411(d)(2) provides the E PA the same authority to prescribe a plan for a state in cases where the stat e fails to submit a satisfactory plan as the agency would have under CAA section 110(c) in the case of failure to submit an implementation plan. In addition, the EPA has authority under CAA sec tion 111(d)(1) to prescribe regulations that establish procedures similar to CAA section 110 with respect to the submission of state plans, and the EPA also has general rulemaking authority as necessary to implement the CAA

under section 301.

2(b) Use/Users of the Data

Data will not be collected from respondents during the c ourse of 3-year period associated

with this ICR.

3. Nonduplication, Consultations, and Other Collection Criter ia

3(a) Nonduplication

As previously stated, this action imposes no new informati on collection burden on affected sources (EGUs) during the first 3 years after f inal rule promulgation, beyond reading and understanding the rule. There are no new information collection costs; the i nformation3

required by these guidelines is already collected and repor ted by EGUs subject to 40 CFR parts 75 and 98. Therefore, no duplication exists for the affected industry.

3(b) Public Notice Required Prior to ICR Submission to OMB

This section is not applicable because this is a rule-re lated ICR.

3(c) Consultations

The EPA has maintained ongoing engagement with stakeholder s on the scope of this rulemaking. There has been considerable outreach on the proposed Clean Power Plan to all stakeholders, including 11 listening sessions (one held in eac h region and one held at headquarters in Washington D.C.); four two-day public hearings and ongoing interaction with states, utilities, labor unions, nongovernmental organizat ions, consumer groups, industry and the general public. The EPA convened a Small Business Advocacy Review (SBAR) Panel to obtain advice and recommendations from small entity representat ives that potentially would be subject to the rule's requirements. The SBAR Panel evaluated the assembled materials and small-entity

comments on issues related to elements of an initial re gulatory flexibility analysis (IRFA).

The EPA has conducted consultation with tribes on the C lean Power Plan and the Supplemental Proposal for the Clean Power Plan and wil l offer all tribes consultation on this action. Additionally, the EPA engaged in meaningful dialo gue with tribal stakeholders to obtain their feedback in the pre-proposal stages of this the rul emaking.

3(d) Effects of Less Frequent Collection

This section is not applicable because there is no burden on respondents for the 3-year ICR period.

3(e) General Guidelines

None of the guidelines in 5 CFR 1320.5 are being exceeded.

3(f) Confidentiality

All information submitted to the agency for which a cla im of confidentiality is made will be safeguarded according to the agency policies set forth in Title 40, Chapter 1, part 2, subpart B–Confidentiality of Business Information (see 40 CFR 2; 41 FR 36902, September 1, 1976; amended by 43 FR 39999, September 28, 1978; 43 FR 42251, September 28, 1978; 44 FR 17674, March 23, 1979).

3(g) Sensitive Questions

This section is not applicable because this ICR does not involve matters of a sensitive

nature.

4. The Respondents and the Information Requested

4(a) Respondents/NAICS Codes

Potential respondents to this ICR are the owners or oper ators or existing fossil fuel-fired EGUs that were in operation or had commenced constructio n on or before January 8, 2014. There are an estimated 3,064 affected EGUs located at 1,028 facilities within the 48 contiguous

states and tribal lands.4

4(b) Information Requested

(i) Data Items, Including Recordkeeping Requirements

There are no new information collection costs for th e affected industry beyond reading and understanding the rule because the information require d by the EGs is already collected and reported by other regulatory programs (40 CFR parts 75 and 98).

(ii) Respondent Activities

The respondent activities required over the 3-year period a re limited to reading and understanding the proposed rule requirements (see Exhibit 1).

5. The Information Collected: Agency Activities, Collection Methodology, and Information Management (covering the first 3 years following fin al rule promulgation)

5(a) Agency Activities

The agency, specifically the EPA Headquarters and the EPA Regions, will not incur burden during the 3-year period associated with this ICR.

5(b) Collection Methodology and Management

This section does not apply because the agency does not ha ve any information collection activities under the 3-year period of this ICR.

5(c) Small Entity Flexibility

The EPA is aware that there is substantial interest in the rule among small entities (municipal and rural electric cooperatives). Pursuant to s ection 603 of the RFA, the EPA prepared an initial regulatory flexibility analysis (IRFA ) that examined the impact of the proposed rule on small entities along with regulatory alt ernatives that could minimize that impact. As required by section 609(b) of the RFA, the EPA also convened a Small Business Advocacy Review (SBAR) Panel to obtain advice and recom mendations from small entity representatives that potentially would be subject to the rule's requirements. The SBAR Panel evaluated the assembled materials and small-entity comm ents on issues related to elements of an

IRFA.

The EPA also considered whether the changes that we are proposing to the framework regulations in Subpart B of Part 60 of the CAA regulatio ns would have any impacts on small entities. Since these changes only modify and enhance th e procedures that the Administrator will follow in processing state plans and promulgating a federal plan, and do not alter the rules or requirements that states or regulated entities must foll ow, the agency does not believe that there will be economic impacts on small entities from this portion of the proposal.

5(d) Collection Schedule

This section does not apply because the agency does not ha ve any information collection activities under the 3-year period of this ICR.

6. Estimating the Burden and Cost of the Collection

6(a) Estimating Respondent Burden

Exhibit 1 documents the individual burdens for the reporting r equirements applicable to affected EGUs for the first three years. The average annual burden over the 3-year period of this5

ICR from reading and understanding the rule requirements i s estimated to be 17,150 hours per year. These hours are based on agency studies and backgroun d documents from the development of the EGs and the agency’s knowledge and experience wit h other regulations.

6(b) Estimating Respondent Costs

Respondent costs are typically divided into three categ ories. These categories include labor costs, operation and maintenance (O&M) costs, an d annualized capital costs. Labor costs and O&M costs are the only respondent costs associated wi th this ICR.

(i) Estimating Labor Costs

The average annual labor costs over the 3-year period of t his ICR from these reporting requirements are estimated to be $1,762,214 (detailed in Exhibit 1) . Labor rates and associated costs are based on Bureau of Labor Statistics (BLS) dat a. Technical, managerial, and clerical average hourly rates for private industry workers were ba sed on the Bureau of Labor Statistics, May 2014 National Occupational Employment and Wage Estimat es for the United States. The state government labor rates from BLS were multiplie d by an overhead multiplier of 110 percent to estimate loaded labor rates of $87.17 per hour for technic al, $118.34 per hour for managerial, and $34.84 per hour for clerical.

(ii) Estimating Annualized Capital Costs

There are no annualized capital costs associated with this ICR.

(iii) Estimating Operations and Maintenance (O&M) Costs

There are no annualized O&M costs associated with this ICR.

6(c) Estimating Agency Burden and Cost

Because the information collection requirements were de veloped as an incidental part of standards development, no costs can be attributed to the deve lopment of the information collection requirements. Because reporting and recordkeepin g requirements on the part of the respondents are required under section 111 of the CAA, no ope rational costs will be incurred by the federal government. Publication and distribution of t he information are part of the Compliance Data System, with the result that no fede ral costs can be directly attributed to the ICR. Examination of records to be maintained by the respon dents will occur incidentally as part of EPA’s overall compliance and enforcement program, and, therefore, is not attributable to the

ICR.

6(d) Estimating the Respondent Universe and Total Burden and Costs.

There are an estimated 1,028 facilities that are current ly operating affected EGUs. Consequently, the average number of respondents during the 3 -year period of this ICR is 1,028 respondents/3 years = 343 respondents per year.

The total annual burden attributable to this ICR is limited t o reading and understanding the requirements of the proposed rule. The total labor bur den over the 3-year ICR period is estimated to be 51,450 person-hours for affected facilities. The total labor costs over the 3-year ICR period are estimated to be $5.3 million.6

6(e) Bottom Line Burden Hours and Cost Tables

The bottom line labor hours and costs for respondents ar e shown in Exhibit 1.

6(f) Reasons for Change in Burden

This section does not apply because this is a new ICR.

6(g) Burden Statement

The average annual respondent burden for the proposed federal plan and enhancements to 40 CFR 60 Subpart B is estimated to be 17,133 hours. Burden means th e total time, effort, or financial resources expended by persons to generate, maintai n, retain, or disclose or provide information to or for a federal agency. This includes th e time needed to review instructions; develop, acquire, install, and utilize technology and system s for the purposes of collecting, validating, and verifying information, processing and maintai ning information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able t o respond to a collection of information; search data sources; complete and review t he 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 currentl y valid OMB control number. The OMB control numbers for EPA’s regulations in 40 CFR part 60 are listed in 40 CFR part 9.

PART B

This section is not applicable because statistical meth ods are not used in data collection associated with these guidelines.7 ATTACHMENTS

Exhibit 1 . Respondent Burden and Cost of Reporting and Recordkeeping Re quirements, Federal Plan Requirements for Greenhouse Gas Emissions from E lectric Utility Generating Units Constructed on or Before January 8, 2014; Model Trading Rules; Amendments to Framework Regulations8Exhibit 1. Respondent Burden and Cost of Reporting and Recordkeeping Requirements, Federal Plan Requirements for Greenhouse GasEmissionsfrom Electric Utility Generating Units Constructed on or Before January 8, 2014; Model Trading Rules; Amendments to Framework RegulationsBurden Item(A)RespondentHours perOccurrence(B)Number ofOccurrences PerRespondent PerYear(C)Hours perRespondentPer Year(A x B)(D)Number ofRespondentsPer Yeara(E)TotalHours/Year(C x D)(F)TechnicalHours perYear @$87.17(E x 0.79)(G)Management Hoursper Year @$118.34(E x 0.09)(H)ClericalHours perYear @$34.84(E x 0.12)(I)TotalLaborCosts PerYearb(J)TotalNumber ofResponsesper Year(B xD)c1. REPORTING REQUIREMENTSA. Read and Understand RuleRequirementsd50 1 50 343 17,150 8,575 8,575 0 $1,762,214 0B. Required ActivitiesC. Create InformationIncl. in 1BD. Gather InformationIncl. in 1BE. Report PreparationAVERAGE ANNUAL LABORBURDEN AND COSTe17,150 8,575 8,575 0 $1,762,214 0AVERAGE ANNUALIZED COSTS(O&M)Recordkeeping/reporting suppliesa The number of respondents per year is the 1,028 affected unitsaveraged over the 3-year ICR period (1,028/3=343).b This ICR uses mean hourly wage for the following labor categories from the United States Department of Labor, Bureau of Labor Statistics, May 2014, “National Occupational Employmentand Wage Estimates United States”: General and Operations Managers for Managerial labor, Environmental Engineersfor Technical labor, and Secretaries and AdministrativeAssistants,Except Legal, Medical, and Executive for Clerical labor.The rates have been increased by 110 percent to account for thebenefit packages available to those employed by private industry.c Includes only responses that are submitted as reports. Noreporting is expected during the term of this ICR.d Assumes one-time burden of 50 hours (based on an average reading rate of 100 words/minute) to read and understand rule requirements, divided equally among technical and managerialstaff.e Assumes minimal new burden on affected EGUs beyond what those affected EGUs would already be subject to under the authorities of CAA parts 75 and 98.9 Respondent Labor Rates (2014)

Labor Category Unloaded a Overhead Multiplier (110%) Loaded

Technical 41.51 2.1 87.17

Managerial 56.35 2.1 118.34

Clerical 16.59 2.1 34.84

a Unloaded labor rates from U.S. Department of Labor, Burea u of Labor Statistics, May 2014,

“ National Occupational Employment and Wage Estimates United States” http://www.bls.gov/oes/2014/may/oes_nat.htm