[Federal Register Volume 62, Number 40 (Friday, February 28, 1997)]
[Proposed Rules]
[Pages 9138-9140]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-4966]



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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[CA 009-0028; FRL-5694-9]


Approval and Promulgation of Implementation Plans; California 
State Implementation Plan Revision; South Coast Air Quality Management 
District

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing a limited approval and limited disapproval of 
revisions to the California State Implementation Plan (SIP) for ozone. 
The revisions concern the control of oxides of nitrogen (NO<INF>X) from 
boilers, process heaters, and internal combustion engines. The intended 
effect of proposing limited approval and limited disapproval of these 
rules is to regulate emissions of NO<INF>X in accordance with the 
requirements of the Clean Air Act, as amended in 1990 (CAA or the Act). 
EPA's final action on this proposed rulemaking will incorporate these 
rules into the Federally approved SIP. EPA has evaluated these rules 
and is proposing a simultaneous limited approval and limited 
disapproval under provisions of the CAA regarding EPA actions on SIP 
submittals and general rulemaking authority because these revisions, 
while strengthening the SIP, also do not fully meet the CAA provisions 
regarding plan submissions and requirements for nonattainment areas.

DATES: Comments on this proposed action must be received in writing on 
or before March 31, 1997.

ADDRESSES: Comments may be mailed to: Andrew Steckel, Rulemaking Office 
(AIR-4), Air Division, U.S. Environmental Protection Agency, Region IX, 
75 Hawthorne Street, San Francisco, CA 94105-3901.
    Copies of the rules and EPA's evaluation report of each rule are 
available for public inspection at EPA's Region IX office during normal 
business hours. Copies of the submitted rules are also available for 
inspection at the following locations:

South Coast Air Quality Management District, 21865 E. Copley Drive, 
Diamond Bar, CA 91765-4182.
California Air Resources Board, Stationary Source Division, Rule 
Evaluation Section, 2020 ``L'' Street, Sacramento, CA 95814.

FOR FURTHER INFORMATION CONTACT: Mae Wang, Rulemaking Office (AIR-4), 
Air Division, U.S. Environmental Protection Agency, Region IX, 75 
Hawthorne Street, San Francisco, CA 94105, Telephone: (415) 744-1200.

SUPPLEMENTARY INFORMATION:

Applicability

    The rules being proposed for limited approval and limited 
disapproval are South Coast Air Quality Management District (SCAQMD) 
Rule 1109, Emissions of Oxides of Nitrogen from Boilers and Process 
Heaters in Petroleum Refineries, adopted by SCAQMD on August 5, 1988; 
and Rule 1110.2, Emissions from Gaseous- and Liquid-Fueled Internal 
Combustion Engines, adopted on December 9, 1994.

Background

    On November 15, 1990, the Clean Air Act Amendments of 1990 (CAA) 
were enacted. Pub. L. 101-549, 104 Stat. 2399, codified at 42 U.S.C. 
7401-7671q. The air quality planning requirements for the reduction of 
NO<INF>X emissions through reasonably available control technology 
(RACT) are set out in section 182(f) of the CAA. On November 25, 1992, 
EPA published a notice of proposed rulemaking (NPR) entitled ``State 
Implementation Plans; Nitrogen Oxides Supplement to the General 
Preamble; Clean Air Act Amendments of 1990 Implementation of Title I; 
Proposed Rule,'' (the NO<INF>X Supplement) which describes the 
requirements of section 182(f). The NO<INF>X Supplement should be 
referred to for further information on the NO<INF>X requirements and is 
incorporated into this document by reference.
    Section 182(f) of the CAA requires States to apply the same 
requirements to major stationary sources of NO<INF>X (``major'' as 
defined in section 302 and sections 182 (c), (d), and (e)) as are 
applied to major stationary sources of volatile organic compounds 
(VOCs), in moderate or above ozone nonattainment areas. The Los 
Angeles-South Coast Air Basin is classified as extreme;<SUP>1 therefore 
this area was subject to the RACT requirements of section 182(f), 
section 182(b)(2), and the November 15, 1992 deadline, cited below.
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    \1\ The Los Angeles-South Coast Air Basin Area retained its 
designation of nonattainment and was classified by operation of law 
pursuant to sections 107(d) and 181(a) upon the date of enactment of 
the CAA. See 55 FR 56694 (November 6, 1991).
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    Section 182(b)(2) requires submittal of RACT rules for major 
stationary sources of VOC emissions (not covered by a pre-enactment 
control technique guidelines (CTG) document or a post-enactment CTG 
document) by November 15, 1992. There were no NO<INF>X CTGs issued 
before enactment and EPA has not issued a CTG document for any NO<INF>X 
sources since enactment of the CAA. The RACT rules covering NO<INF>X 
sources and submitted as SIP revisions are expected to require final 
installation of the actual NO<INF>X controls as expeditiously as 
practicable, but no later than May 31, 1995.
    This document addresses EPA's proposed action for SCAQMD Rule 1109, 
Emissions of Oxides of Nitrogen from Boilers and Process Heaters in 
Petroleum Refineries, and Rule 1110.2, Emissions from Gaseous- and 
Liquid-Fueled Internal Combustion Engines. The SCAQMD adopted Rule 1109 
on August 5, 1988, and the rule was submitted by the California Air 
Resources Board (CARB) to EPA on March 26, 1990. Rule 1110.2 was 
adopted on December 9, 1994, and submitted on April 13, 1995. The above 
rules were found to be complete on June 20, 1990, and May 2, 1995, 
respectively, pursuant to EPA's completeness criteria that are set 
forth in 40 CFR Part 51 Appendix V,<SUP>2 and are being proposed for 
limited approval and limited disapproval into the SIP.
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    \2\ EPA adopted the completeness criteria on February 16, 1990 
(55 FR 5830) and, pursuant to section 110(k)(1)(A) of the CAA, 
revised the criteria on August 26, 1991 (56 FR 42216).
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    Rule 1109 and Rule 1110.2 control NO<INF>X emissions from refinery 
boilers and process heaters, and internal combustion (I/C) engines. 
NO<INF>X emissions contribute to the production of ground level ozone 
and smog. These rules were adopted as part of SCAQMD's efforts to 
achieve the National Ambient Air Quality Standards for ozone and in 
response to the CAA requirements cited above. The following is EPA's 
evaluation and proposed action for these rules.

EPA Evaluation and Proposed Action

    In determining the approvability of a NO<INF>X rule, EPA must 
evaluate the rule for consistency with the requirements of the CAA and 
EPA regulations, as found in section 110 and Part D of the CAA, and 40 
CFR Part 51 (Requirements for Preparation, Adoption and Submittal of 
Implementation Plans). EPA's interpretation of these requirements, 
which forms the basis for this action, appears in the NO<INF>X 
Supplement and various other EPA policy guidance documents.<SUP>3 Among 
these provisions is

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the requirement that a NO<INF>X rule must, at a minimum, provide for 
the implementation of RACT for major stationary sources of NO<INF>X 
emissions.
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    \3\ Among other things, the pre-amendment guidance consists of 
those portions of the proposed post-1987 ozone and carbon monoxide 
policy that concern RACT, 52 FR 45044 (November 24, 1987); and 
``Issues Relating to VOC Regulation Cutpoints, Deficiencies, and 
Deviations, Clarification to Appendix D of November 24, 1987 Federal 
Register Notice'' (Blue Book) (notice of availability was published 
in the Federal Register on May 25, 1988).
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    For the purposes of assisting State and local agencies in 
developing NO<INF>X RACT rules, EPA prepared the NO<INF>X Supplement to 
the General Preamble, cited above (57 FR 55620). In the NO<INF>X 
Supplement, EPA provides guidance on how RACT will be determined for 
stationary sources of NO<INF>X emissions. While most of the guidance 
issued by EPA on what constitutes RACT for stationary sources has been 
directed towards application for VOC sources, much of the guidance is 
also applicable to RACT for stationary sources of NO<INF>X (see section 
4.5 of the NO<INF>X Supplement). In addition, pursuant to section 
183(c), EPA has issued alternative control technique documents (ACTs) 
that identify alternative controls for all categories of stationary 
sources of NO<INF>X. The ACT documents provide information on control 
technology for stationary sources that emit or have the potential to 
emit 25 tons per year or more of NO<INF>X. However, the ACTs will not 
establish a presumptive norm for what is considered RACT for stationary 
sources of NO<INF>X. In general, the guidance documents cited above, as 
well as other relevant and applicable guidance documents, have been set 
forth to ensure that submitted NO<INF>X RACT rules meet Federal RACT 
requirements and are fully enforceable and strengthen or maintain the 
SIP.
    SCAQMD Rule 1109 controls emissions of nitrogen oxides from boilers 
and process heaters located in petroleum refineries with rated 
capacities greater than 40 MBtu per hour heat input. The rule requires 
units to meet a 0.03 pound per million Btu heat input limit in 
accordance with a phased time schedule. The emission limits will 
strengthen the SIP, but this rule contains deficiencies which must be 
corrected. Those deficiencies include Executive Officer discretion in 
approving continuous emission monitoring equipment and test methods, 
insufficient records to determine compliance, and an unapprovable 
provision for an alternative emission control plan.
    Rule 1110.2 controls NO<INF>X, carbon monoxide (CO), and reactive 
organic gases (ROG) from I/C engines. The emission limits in this rule 
are 36 ppm for NO<INF>X, 2000 ppm for CO, and 250 ppm for ROG. Certain 
types of units specifically identified in the rule may have an 
allowable NO<INF>X emission limit of approximately 45 ppm. In setting 
these limits, the SCAQMD considered emission reductions, control 
technologies, cost-effectiveness, and environmental impacts. EPA agrees 
that the limits incorporated into SCAQMD Rule 1110.2 are consistent 
with the Agency's guidance and policy for making RACT determinations, 
and that these limits satisfy the RACT requirement. The limits of Rule 
1110.2 will strengthen the SIP, but this rule contains deficiencies 
with respect to the requirements of the CAA and EPA regulations as 
interpreted in the various policy guidance documents discussed earlier. 
Certain existing units are not required to be in compliance until the 
year 2004, which is well beyond the statutory May 31, 1995 deadline, 
and the rule allows for Executive Officer discretion in approving 
continuous emission monitoring equipment and test methods for 
determining compliance with emission limits.
    EPA has evaluated the submitted rules described above for 
consistency with the CAA, EPA regulations, and EPA policy, and although 
these rules will strengthen the SIP, they still contain deficiencies 
which were required to be corrected pursuant to the section 
182(a)(2)(A) requirement of Part D of the CAA. A more detailed 
discussion of the sources controlled, the limits required, 
justification for why these limits satisfy RACT, and the rule 
deficiencies can be found in the Technical Support Document (TSD) for 
each rule, available from the U.S. EPA Region IX office. Because of the 
deficiencies, these rules are not consistent with the interpretation of 
section 172 of the 1977 CAA as found in the Blue Book and may lead to 
rule enforceability problems. As a result, these rules are not 
approvable pursuant to section 182(a)(2), section 182(b)(2), section 
182(f) and Part D of the CAA.
    For the reasons mentioned above, EPA cannot grant full approval of 
these rules under section 110(k)(3) and Part D. Also, because the 
submitted rules are not composed of separable parts which meet all the 
applicable requirements of the CAA, EPA cannot grant partial approval 
of the rules under section 110(k)(3). However, EPA may grant a limited 
approval of the submitted rules under section 110(k)(3) in light of 
EPA's authority pursuant to section 301(a) to adopt regulations 
necessary to further air quality by strengthening the SIP. The approval 
is limited because EPA's action also contains a simultaneous limited 
disapproval. In order to strengthen the SIP, EPA is proposing a limited 
approval of the SCAQMD's submitted Rule 1109 and Rule 1110.2, under 
sections 110(k)(3) and 301(a) of the CAA as meeting the requirements of 
section 110(a) and Part D.
    At the same time, EPA is also proposing a limited disapproval of 
these rules because they contain deficiencies which must be corrected 
in order to fully meet the requirements of section 182(a)(2), section 
182(b)(2), section 182(f), and Part D of the Act. Under section 
179(a)(2), if the Administrator disapproves a submission under section 
110(k) for an area designated nonattainment, based on the submission's 
failure to meet one or more of the elements required by the Act, the 
Administrator must apply one of the sanctions set forth in section 
179(b) unless the deficiency has been corrected within 18 months of 
such disapproval. Section 179(b) provides two sanctions available to 
the Administrator: highway funding and offsets. The 18 month period 
referred to in section 179(a) will begin on the effective date of EPA's 
final limited disapproval. Moreover, the final disapproval triggers the 
Federal Implementation Plan (FIP) requirement under section 110(c). It 
should be noted that the rules covered by this NPR have been adopted by 
the SCAQMD and are currently in effect in the SCAQMD. EPA's final 
limited disapproval action will not prevent the SCAQMD or EPA from 
enforcing these rules.
    Nothing in this action should be construed as permitting or 
allowing or establishing a precedent for any future request for 
revision to any State implementation plan. Each request for revision to 
the State implementation plan shall be considered separately in light 
of specific technical, economic and environmental factors and in 
relation to relevant statutory and regulatory requirements.

Regulatory Process

Regulatory Flexibility Act

    Under the Regulatory Flexibility Act, 5 U.S.C. section 600 et seq., 
EPA must prepare a regulatory flexibility analysis assessing the impact 
of any proposed or final rule on small entities. 5 U.S.C sections 603 
and 604. Alternatively, EPA may certify that the rule will not have a 
significant economic impact on a substantial number of small entities. 
Small entities include small businesses, small not-for-profit 
enterprises, and government entities with jurisdiction over populations 
of less than 50,000.
    Limited approvals under section 110 and 301 and subchapter I, Part 
D of the CAA do not create any new requirements, but simply approve 
requirements that the State is already imposing. Therefore, because the 
Federal SIP-approval does not impose any new requirements, it does not 
have a significant impact on affected small

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entities. Moreover, due to the nature of the Federal/State relationship 
under the CAA, preparation of a regulatory flexibility analysis would 
constitute Federal inquiry into the economic reasonableness of State 
action. The CAA forbids EPA to base its actions concerning SIPs on such 
grounds. Union Electric Co. v. U.S. E.P.A. , 427 U.S. 246, 256-66 
(S.Ct. 1976); 42 U.S.C. section 7410 (a)(2).

Unfunded Mandates

    Under Sections 202, 203, and 205 of the Unfunded Mandates Reform 
Act of 1995 (``Unfunded Mandates Act''), signed into law on March 22, 
1995, EPA must undertake various actions in association with proposed 
or final rules that include a Federal mandate that may result in 
estimated costs of $100 million or more to the private sector or to 
State, local, or tribal governments in the aggregate.
    Through submission of this State implementation plan revision, the 
State and any affected local or tribal governments have elected to 
adopt the program provided for under Part D of the Clean Air Act. These 
rules may bind State, local, and tribal governments to perform certain 
actions and also require the private sector to perform certain duties. 
The rules being proposed for limited approval and limited disapproval 
by this action will impose no new requirements because affected sources 
are already subject to these regulations under State law. Therefore, no 
additional costs to State, local, or tribal governments or to the 
private sector result from this action. EPA has also determined that 
this proposed action does not include a mandate that may result in 
estimated costs of $100 million or more to State, local, or tribal 
governments in the aggregate or to the private sector.

Executive Order 12866

    This action has been classified as a Table 3 action for signature 
by the Regional Administrator under procedures published in the Federal 
Register on January 19, 1989 (54 FR 2214-2225), as revised by a July 
10, 1995 memorandum from Mary Nichols, Assistant Administrator for Air 
and Radiation. The Office of Management and Budget has exempted this 
regulatory action from review under Executive Order 12866.

List of Subjects in 40 CFR Part 52

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

    Authority: 42 U.S.C. 7401-7671q.

    Dated: February 12, 1997.
Felicia Marcus,
Regional Administrator.
[FR Doc. 97-4966 Filed 2-27-97; 8:45 am]
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