36870 Federal Register / Vol. 89, No. 87 / Friday, May 3, 2024 / Proposed Rules 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Parts 51 and 52 

[EPA–HQ–OAR–2022–0381; FRL–9249–01– 

OAR] 

RIN 2060–AV62 

Prevention of Significant Deterioration 

(PSD) and Nonattainment New Source 

Review (NNSR): Regulations Related to 

Project Emissions Accounting 

AGENCY: The Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: In this action, the 

Environmental Protection Agency (EPA) 

is proposing revisions to the 

preconstruction permitting regulations 

that apply to modifications at existing 

major stationary sources in the New 

Source Review (NSR) program under the 

Clean Air Act (CAA or Act). The 

proposed revisions include revising the 

definition of ‘‘project’’ in the NSR 

regulations, adding additional 

recordkeeping and reporting 

requirements applicable to minor 

modifications at existing major 

stationary sources, and proposing to 

require that decreases accounted for in 

the Step 1 significant emissions increase 

calculation be enforceable. 

DATES: Comments: Comments must be 

received on or before July 2, 2024. 

Public hearing: If anyone contacts the 

EPA requesting a public hearing by May 

8, 2024, the EPA will hold a virtual 

public hearing. See SUPPLEMENTARY

INFORMATION for information on 

requesting and registering for a public 

hearing. 

ADDRESSES: 

Comments: You may send comments, 

identified by Docket ID No. EPA–HQ– 

OAR–2022–0381, by any of the 

following methods: 

Federal eRulemaking Portal: https://

www.regulations.gov/ (our preferred 

method). Follow the online instructions 

for submitting comments. 

• Email:a-and-r-docket@epa.gov.

Include Docket ID No. EPA–HQ–OAR– 

2022–0381 in the subject line of the 

message. 

• Fax: (202) 566–9744. Attention

Docket ID No. EPA–HQ–OAR–2022– 

0381. 

• Mail: U.S. Environmental

Protection Agency, EPA Docket Center, 

Docket ID No. EPA–HQ–OAR–2022– 

0381, Mail Code 28221T, 1200 

Pennsylvania Avenue NW, Washington, 

DC 20460. 

• Hand/courier delivery: EPA Docket

Center, WJC West Building, Room 3334, 

1301 Constitution Avenue NW, 

Washington, DC 20004. The Docket 

Center’s hours of operation are 8:30 

a.m.–4:30 p.m., Monday–Friday (except

Federal holidays).

Instructions: All submissions received 

must include the Docket ID No. EPA– 

HQ–OAR–2022–0381 for this 

rulemaking. Comments received may be 

posted without change to https://

www.regulations.gov/, including any 

personal information provided. For 

detailed instructions on sending 

comments and additional information 

on the rulemaking process, see the 

SUPPLEMENTARY INFORMATION section of 

this document. For further information 

on EPA Docket Center services and the 

current status, please visit us online at 

https://www.epa.gov/dockets. In 

addition, the EPA has a website for NSR 

rulemakings at: https://www.epa.gov/ 

nsr. The website includes the EPA’s 

proposed and final NSR regulations, as 

well as guidance documents and 

technical information related to 

preconstruction permitting. 

FOR FURTHER INFORMATION CONTACT: Mr. 

Peter Keller, Air Quality Policy 

Division, Office of Air Quality Planning 

and Standards (C539–04), 

Environmental Protection Agency, Post 

Office Box 12055, Research Triangle 

Park, NC 27711; telephone number: 

(919) 541–2065; email address:

keller.peter@epa.gov.

SUPPLEMENTARY INFORMATION:

Public hearing. To request a virtual 

public hearing, contact Ms. Pamela Long 

at (919) 541– 0641 or by email at 

long.pam@epa.gov. If requested, the 

virtual hearing will be held on May 20, 

2024. The hearing will convene at 9:00 

a.m. Eastern Time (ET) and will

conclude at 3:00 p.m. ET. The EPA may

close a session 15 minutes after the last

pre-registered speaker has testified if

there are no additional speakers. The

EPA will announce further details at

https://www.epa.gov/nsr.

Upon publication of this document in 

the Federal Register, the EPA will begin 

pre-registering speakers for the hearing, 

if a hearing is requested. To register to 

speak at the virtual hearing, please use 

the online registration form available at 

https://www.epa.gov/nsr or contact Ms. 

Pamela Long at (919) 541–0641 or by 

email at long.pam@epa.gov. The last day 

to pre-register to speak at the hearing 

will be May 16, 2024. Prior to the 

hearing, the EPA will post a general 

agenda that will list pre-registered 

speakers in approximate order at: 

https://www.epa.gov/nsr. 

The EPA will make every effort to 

follow the schedule as closely as 

possible on the day of the hearing; 

however, please plan for the hearings to 

run either ahead of schedule or behind 

schedule. 

Each commenter will have 3 minutes 

to provide oral testimony. The EPA 

encourages commenters to provide the 

EPA with a copy of their oral testimony 

electronically (via email) by emailing it 

to long.pam@epa.gov. The EPA also 

recommends submitting the text of your 

oral testimony as written comments to 

the rulemaking docket. 

The EPA may ask clarifying questions 

during the oral presentations but 

generally will not respond to the 

presentations at that time. Written 

statements and supporting information 

submitted during the comment period 

will be considered with the same weight 

as oral testimony and supporting 

information presented at the public 

hearing. 

Please note that any updates made to 

any aspect of the hearing will be posted 

online at https://www.epa.gov/nsr. 

While the EPA expects the hearing to go 

forward as set forth earlier, please 

monitor our website or contact Ms. 

Pamela Long at (919) 541–0641 or by 

email at long.pam@epa.gov to determine 

if there are any updates. The EPA does 

not intend to publish a document in the 

Federal Register announcing updates. If 

you require the services of a translator 

or special accommodations such as 

audio description, please preregister for 

the hearing with Ms. Pamela Long and 

describe your needs by May 13, 2024. 

The EPA may not be able to arrange 

special accommodations without 

advanced notice. 

Docket. The EPA has established a 

docket for this rulemaking under Docket 

ID No. EPA–HQ–OAR–2022–0381. All 

documents in the docket are listed in 

the Regulations.gov index. Although 

listed in the index, some information is 

not publicly available, e.g., 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. 

Publicly available docket materials are 

available either electronically in 

Regulations.gov or in hard copy at the 

EPA Docket Center, Room 3334, EPA 

WJC West Building, 1301 Constitution 

Avenue 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 EPA

Docket Center is (202) 566–1742.

Instructions. Direct your comments to 

Docket ID No. EPA–HQ–OAR–2022– 


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Federal Register / Vol. 89, No. 87 / Friday, May 3, 2024 / Proposed Rules 36871 

0381. The EPA’s policy is that all 

comments received will be included in 

the public docket without change and 

may be made available online at https:// 

www.regulations.gov, including any 

personal information provided, unless 

the comment includes information 

claimed to be CBI or other information 

whose disclosure is restricted by statute. 

Do not submit information that you 

consider to be CBI or otherwise 

protected through https://

www.regulations.gov or email. This type 

of information should be submitted by 

mail as discussed later. 

The EPA may publish any comment 

received to its public docket. 

Multimedia submissions (audio, video, 

etc.) must be accompanied by a written 

comment. The written comment is 

considered the official comment and 

should include discussion of all points 

you wish to make. The EPA will 

generally not consider comments or 

comment contents located outside of the 

primary submission (i.e., on the Web, 

cloud, or other file sharing system). For 

additional submission methods, the full 

EPA public comment policy, 

information about CBI or multimedia 

submissions, and general guidance on 

making effective comments, please visit 

https://www.epa.gov/dockets/ 

commenting-epa-dockets. 

The https://www.regulations.gov 

website is an ‘‘anonymous access’’ 

system, which means the EPA will not 

know your identity or contact 

information unless you provide it in the 

body of your comment. If you send an 

email comment directly to the EPA 

without going through https://

www.regulations.gov, your email 

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, the EPA 

recommends that you include your 

name and other contact information in 

the body of your comment and with any 

digital storage media you submit. If the 

EPA cannot read your comment due to 

technical difficulties and cannot contact 

you for clarification, the EPA may not 

be able to consider your comment. 

Electronic files should not include 

special characters or any form of 

encryption and be free of any defects or 

viruses. For additional information 

about the EPA’s public docket, visit the 

EPA Docket Center homepage at https:// 

www.epa.gov/dockets. 

Submitting CBI. Do not submit 

information containing CBI to the EPA 

through https://www.regulations.gov/. 

Clearly mark the part or all of the 

information that you claim to be CBI. 

For CBI information on any digital 

storage media that you mail to the EPA, 

mark the outside of the digital storage 

media as CBI and then identify 

electronically within the digital storage 

media the specific information that is 

claimed as CBI. In addition to one 

complete version of the comments that 

includes information claimed as CBI, 

you must submit a copy of the 

comments that does not contain the 

information claimed as CBI directly to 

the public docket through the 

procedures outlined in Instructions. If 

you submit any digital storage media 

that does not contain CBI, mark the 

outside of the digital storage media 

clearly that it does not contain CBI. 

Information not marked as CBI will be 

included in the public docket and EPA’s 

electronic public docket without prior 

notice. Information marked as CBI will 

not be disclosed except in accordance 

with procedures set forth in 40 Code of 

Federal Regulations (CFR) part 2. Our 

preferred method to receive CBI is for it 

to be transmitted electronically using 

email attachments, File Transfer 

Protocol (FTP), or other online file 

sharing services (e.g., Dropbox, 

OneDrive, Google Drive). Electronic 

submissions must be transmitted 

directly to the OAQPS CBI Office using 

the email address, oaqpscbi@epa.gov, 

and should include clear CBI markings 

as described later. If assistance is 

needed with submitting large electronic 

files that exceed the file size limit for 

email attachments, and if you do not 

have your own file sharing service, 

please email oaqpscbi@epa.gov to 

request a file transfer link. If sending 

CBI information through the postal 

service, please send it to the following 

address: OAQPS Document Control 

Officer (C404–02), OAQPS, U.S. 

Environmental Protection Agency, 

Research Triangle Park, North Carolina 

27711, Attention Docket ID No. EPA– 

HQ–OAR–2023–0401. The mailed CBI 

material should be double wrapped and 

clearly marked. Any CBI markings 

should not show through the outer 

envelope. 

Preamble acronyms and 

abbreviations. We use multiple 

acronyms and terms in this preamble. 

While this list may not be exhaustive, to 

ease the reading of this preamble and for 

reference purposes, the EPA defines the 

following terms and acronyms here: 

BACT Best Available Control Technology 

CAA Clean Air Act 

CBI Confidential Business Information 

CFR Code of Federal Regulations 

EPA Environmental Protection Agency 

EUSGU Electric Utility Steam Generating 

Unit 

FR Federal Register 

LAER Lowest Achievable Emissions Rate 

NSR New Source Review 

NNSR Nonattainment New Source Review 

PEA Project Emissions Accounting 

PSD Prevention of Significant Deterioration 

PTE Potential to Emit 

RP Reasonable Possibility in Recordkeeping 

and Reporting 

SER Significant Emissions Rate 

SIP State Implementation Plan 

Organization of this document. The 

information in this preamble is 

organized as follows: 

I. General Information

A. Executive Summary

B. Does this action apply to me?

C. What should I consider as I prepare my

comments for the EPA?

D. Where can I get a copy of this document

and other related information?

II. Background

A. New Source Review Permitting Program

B. Major Modifications Under the NSR

Program

C. Project Emissions Accounting

D. Project Aggregation

E. ‘‘Reasonable Possibility’’ Recordkeeping

and Reporting Provisions

III. Proposed Definition of ‘‘Project’’

IV. Safeguard Against ‘‘Double Counting’’ of

Emissions Decreases and Increases

V. Enforceability of Emissions Decreases

VI. ‘‘Reasonable Possibility’’ Recordkeeping

and Reporting Regulations

A. Clarification of Existing ‘‘Reasonable

Possibility’’ Requirements

B. Proposed New ‘‘Reasonable Possibility’’

Requirements

C. Additional Considerations for Proposed

Reasonable Possibility Revisions

VII. Revisions To Clarify Statutory

Limitations on Netting in Nonattainment

NSR

VIII. Implementation of These Proposed

Revisions for Delegated and SIPApproved Programs

IX. Costs, Benefits, and Other Impacts of the

Proposed Rule

A. Proposed Definition of ‘‘Project’’

B. Enforceability of Emissions Decreases

C. Clarifications and Revisions to the

‘‘Reasonable Possibility’’ (RP) in

Recordkeeping and Reporting Provisions

D. Revisions to Nonattainment

Applicability Provisions

X. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory

Planning and Review and Executive

Order 14094: Modernizing Regulatory

Review

B. Paperwork Reduction Act (PRA)

C. Regulatory Flexibility Act (RFA)

D. Unfunded Mandates Reform Act

(UMRA)

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

Concerning Regulations That

Significantly Affect Energy Supply,

Distribution, or Use

I. National Technology Transfer and

Advancement Act (NTTAA)


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36872 Federal Register / Vol. 89, No. 87 / Friday, May 3, 2024 / Proposed Rules 

1Prevention of Significant Deterioration (PSD) 

and Nonattainment New Source Review (NNSR): 

Project Emissions Accounting, 85 FR 74890 

(November 24, 2020). 

2See Prevention of Significant Deterioration 

(PSD) and Nonattainment New Source Review 

(NSR): Baseline Emissions Determination, Actualto-Future-Actual Methodology, Plantwide 

Applicability Limitations, Clean Units, Pollution 

Control Projects, 67 FR 80185 (December 31, 2002) 

(establishing a new procedure for determining 

‘‘baseline actual emissions’’ and supplementing the 

existing actual-to-potential applicability test with 

an actual-to-projected-actual applicability test for 

determining if a physical or operational change at 

an existing source will result in an emissions 

increase). 

J. Executive Order 12898: Federal Actions 

To Address Environmental Justice in 

Minority Populations and Low-Income 

Populations and Executive Order 14096: 

Revitalizing our Nation’s Commitment to 

Environmental Justice for All 

XI. Statutory Authority 

I. General Information 

A. Executive Summary 

The EPA is proposing several 

revisions to its NSR preconstruction 

permitting regulations intended to 

improve implementation and strengthen 

enforceability of the NSR program 

provisions established in a 2020 

rulemaking titled ‘‘Prevention of 

Significant Deterioration (PSD) and 

Nonattainment New Source Review 

(NNSR): Project Emissions Accounting 

rule’’ (‘‘project emissions accounting’’ or 

‘‘2020 PEA rule’’).1 The revisions 

proposed in this document include (1) 

revisions to the definition of the term 

‘‘project’’ to include criteria for 

determining the scope of a project that 

may be subject to the major NSR 

regulations; (2) revisions to the 

monitoring, recordkeeping and 

reporting provisions in the NSR 

regulations to improve compliance with, 

and enforcement of, the NSR 

applicability process; and (3) revisions 

to require that emissions decreases 

included in the significant emissions 

increase determination of the NSR 

applicability process be enforceable. 

The NSR regulations establish a twostep process for determining when a 

modification to an existing major 

stationary source is subject to major 

NSR requirements. Under Step 1, prior 

to beginning construction, the source 

owner or operator first assesses whether 

a project would result in a significant 

emissions increase. Step 2 involves 

determining whether the project would 

also result in a significant net emissions 

increase from the major stationary 

source. Under these regulations, a 

project is a major modification that 

requires an NSR permit if a project 

results in both a significant emissions 

increase and a significant net emissions 

increase. The activities included in a 

‘‘project’’ define the scope of the 

analysis under Step 1 of the NSR 

applicability process. In this action, the 

EPA is proposing to define the term 

‘‘project’’ with greater specificity to 

ensure appropriate and consistent 

application of that term. The EPA is also 

proposing to improve accountability 

and compliance with this process by 

requiring that decreases in emissions 

associated with a project that are 

included in the significant emissions 

increase determination be enforceable. 

Also, to enhance owner/operator 

accountability and facilitate compliance 

with the NSR applicability 

requirements, the EPA is proposing 

revisions to the recordkeeping and 

reporting requirements in the NSR 

regulations’ ‘‘reasonable possibility’’ 

provisions that apply to projects at 

major stationary sources that are 

evaluated using the actual-to-projectedactual applicability test. The 

‘‘reasonable possibility’’ provisions 

apply in those circumstances where the 

owner/operator determines that the 

project does not qualify as a major 

modification but where there is a 

‘‘reasonable possibility,’’ as that term is 

defined in the regulations, that the 

project may nonetheless result in a 

significant emissions increase. The 

revisions to the reasonable possibility 

provisions in this proposal comport 

with the intent of the recordkeeping and 

reporting requirements as initially 

promulgated by the EPA in 2002 to 

improve compliance with the NSR 

applicability process by owners or 

operators that rely on the actual-toprojected-actual applicability test when 

determining, before beginning actual 

construction, that a project does not 

constitute a major modification.2 The 

EPA is also proposing, in light of the 

2020 codification of project emissions 

accounting, to expand the applicability 

of the reasonable possibility provisions 

to all source owners or operators that 

use project emissions accounting to take 

credit for a decrease in emissions under 

the significant emissions increase 

determination. The EPA is proposing to 

require that all owners or operators of 

major stationary sources subject to the 

‘‘reasonable possibility’’ recordkeeping 

and reporting requirements submit preproject records to the reviewing 

authority and is proposing to specify the 

information these pre-project records 

must include. 

B. Does this action apply to me? 

Entities potentially affected directly 

by this action include air pollution 

emissions sources in all industry 

categories. Entities potentially affected 

by this action also include state, local 

and tribal air pollution control agencies 

responsible for issuing preconstruction 

permits pursuant to the major NSR 

programs. 

C. What should I consider as I prepare 

my comments for the EPA? 

When submitting comments, 

remember to: 

• Identify the rulemaking by docket 

number and other identifying 

information (subject heading, Federal 

Register date and page number). 

• Follow directions. The proposed 

rule may ask you to respond to specific 

questions or organize comments by 

referencing a Code of Federal 

Regulations (CFR) part or section 

number. 

• Explain why you agree or disagree, 

suggest alternatives and substitute 

language for your requested changes. 

• Describe any assumptions and 

provide any technical information and/ 

or data that you used to support your 

comment. 

• If you estimate potential costs or 

burdens, explain how you arrived at 

your estimate in sufficient detail to 

allow for it to be reproduced. 

• Provide specific examples to 

illustrate your concerns wherever 

possible and suggest alternatives. 

• Explain your views as clearly as 

possible, avoiding the use of profanity 

or personal threats. 

• Make sure to submit your 

comments by the comment period 

deadline identified. 

D. Where can I get a copy of this 

document and other related 

information? 

In addition to being available in the 

docket, an electronic copy of this 

Federal Register document will be 

posted at https://www.epa.gov/nsr. 

II. Background 

The NSR program is a CAA program 

that requires certain stationary sources 

of air pollution to obtain permits prior 

to construction. The major NSR program 

applies to new construction and 

modifications of existing sources that 

emit ‘‘regulated NSR pollutants’’ over 

certain thresholds. New or modifying 

sources that emit regulated NSR 

pollutants in levels under those 

thresholds may be subject to minor NSR 

requirements or may be excluded from 

NSR altogether. 

In November 2020, the EPA 

promulgated the ‘‘Prevention of 

Significant Deterioration (PSD) and 

Nonattainment New Source Review 

(NNSR): Project Emissions Accounting’’ 


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Federal Register / Vol. 89, No. 87 / Friday, May 3, 2024 / Proposed Rules 36873 

3Prevention of Significant Deterioration (PSD) 

and Nonattainment New Source Review (NNSR): 

Project Emissions Accounting, 85 FR 74890 

(November 24, 2020). 

4While the EPA determined that the revisions to 

the regulations at 40 CFR 52.21 adopted in the 2020 

PEA rule apply to the EPA and reviewing 

authorities that have been delegated federal 

authority from the EPA to issue major NSR permits 

on behalf of the EPA, for state and local air agencies 

that implement the NSR program through EPAapproved SIPs, section 116 of the CAA allows these 

states and local air agencies to adopt more stringent 

SIP emission control requirements than required by 

the EPA’s regulations. Therefore, reviewing 

authorities that do not allow for PEA have 

applicability requirements that are at least as 

stringent as those required by the Act or the EPA’s 

implementing regulations and, therefore, are not 

required to submit SIP revisions or stringency 

determinations to the EPA incorporating PEA. 85 

FR 74904. 

5Letter from Sanjay Narayan et al., to Acting 

Administrator Jane Nishida, ‘‘Re: Petition for 

Reconsideration of ‘Prevention of Significant 

Deterioration (PSD) and Nonattainment New Source 

Review (NNSR): Project Emissions Accounting,’ 85 

FR 74,890 (November 24, 2020), Docket ID No. 

EPA–HQ–OAR–2018–0048 and for Withdrawal of 

Guidance Memorandum titled ‘Project Emissions 

Accounting Under the New Source Review 

Preconstruction Permitting Program’ (March 13, 

2018) (OAQPS–2020–683 and OAQPS–2020–223),’’ 

January 22, 2021, (‘‘Petition for Reconsideration’’), 

available at https://www.epa.gov/system/files/ 

documents/2021-10/final-nsr-accounting-rulereconsideration-petition-1_22_21.pdf. 

6The petition also discussed a 2018 

Memorandum from the EPA Administrator E. Scott 

Pruitt, to Regional Administrators, titled, ‘‘Project 

Emissions Accounting Under the New Source 

Review Preconstruction Permitting Program,’’ 

March 13, 2018 (‘‘March 2018 Memorandum’’) 

available at: https://www.epa.gov/sites/default/files/ 

2018-03/documents/nsr_memo_03-13-2018.pdf. 

The March 2018 Memorandum explained that ‘‘the 

EPA interpreted the current NSR regulations as 

providing that emissions decreases as well as 

increases are to be considered in Step 1 of the NSR 

applicability process, where those decreases and 

increases are part of a single project.’’ More 

specifically, in the March 2018 Memorandum, the 

EPA interpreted the pre-2020 major NSR 

regulations to mean that emissions increases and 

decreases could be considered in Step 1 for projects 

that involve multiple types of emissions units in the 

same manner as they are considered for projects 

that only involve new or only involve existing 

emissions units. 

7 Denial of Petition for Reconsideration and 

Administrative Stay: ‘‘Prevention of Significant 

Deterioration (PSD) and Nonattainment New Source 

Review (NNSR): Project Emissions Accounting,’’ 86 

FR 57585 (October 18, 2021). 

8 In this action, the EPA refers to ‘‘source’’ as 

shorthand for ‘‘source owner/operator.’’ 

9 ‘‘Regulated NSR pollutant’’ is defined at 40 CFR 

52.21(b)(50). A ‘‘regulated NSR pollutant’’ includes 

any pollutant for which a NAAQS has been 

promulgated and other pollutants regulated under 

the CAA. These other pollutants include fluorides, 

sulfuric acid mist, hydrogen sulfide, total reduced 

sulfur, and reduced sulfur compounds, including 

others. See, e.g., 40 CFR 52.21(b)(23). For NNSR, 

regulated NSR pollutants include only the NAAQS, 

also known as criteria pollutants, and the 

precursors to those pollutants for which the area is 

designated nonattainment. See 40 CFR 

51.165(a)(1)(xxxvii). 

10For PSD, the statute uses the term ‘‘major 

emitting facility,’’ which is defined as a stationary 

source that emits, or has a PTE of, at least 100 tons 

per year (tpy) if the source is in one of 28 listed 

source categories—or at least 250 tpy if the source 

is not—of ‘‘any air pollutant.’’ CAA section 169(1). 

For NNSR, the emissions threshold for a major 

stationary source is 100 tpy, although lower 

thresholds may apply depending on the degree of 

the nonattainment problem and the pollutant. 

11A major stationary source includes any 

physical change that would occur at a stationary 

source not otherwise qualifying under 40 CFR 

52.21(b)(1) as a major stationary source, if the 

change would constitute a major stationary source 

by itself. See, e.g., 40 CFR 52.21(b)(1)(i)(c). 

(PEA) rule to clarify the accounting 

procedures that apply when 

determining whether a physical change 

or a change in the method of operation 

(i.e., a project) at a major stationary 

source would result in a significant 

emissions increase under the major NSR 

preconstruction permitting programs.3

The 2020 PEA rule clarified that both 

increases and decreases in emissions 

resulting from a proposed project shall 

be considered in Step 1 of the NSR 

major modification applicability test.4

The EPA initiated this proposed 

rulemaking based on concerns raised by 

stakeholders on the implementation of 

the NSR program following 

promulgation of the 2020 PEA rule. 

In developing this proposed 

rulemaking, the EPA has considered a 

petition for reconsideration it received 

on the 2020 PEA rule, the comments 

received on that rule’s proposal, and the 

Agency’s own experience in analyzing 

and enforcing the applicable regulatory 

provisions.5 The petition for 

reconsideration described three primary 

concerns with the PEA rule.6 These 

concerns are that (1) the final rule fails 

to ensure that offsetting emission 

decreases used to show that a ‘‘project’’ 

will not cause a significant emission 

increase in Step 1 of the NSR 

applicability analysis result from the 

change being evaluated; (2) the final 

rule allows a source to avoid NSR by 

offsetting emission increases resulting 

from a change with noncontemporaneous emission decreases; 

and (3) that the EPA has not ensured 

that project emission decreases will 

occur and will be maintained. The EPA 

denied the petition for reconsideration 

on the grounds that the petition did not 

make the showing required by CAA 

section 307(d)(7)(b).7 However, the EPA 

agreed that the concerns raised in the 

petition warranted further consideration 

by the EPA, and the agency therefore 

initiated this rulemaking action. The 

EPA has considered these concerns as 

well as comments received on the 

proposed PEA rule in the development 

of this action. 

A. New Source Review Permitting 

Program 

The NSR permitting program applies 

to sources located in an area where the 

National Ambient Air Quality Standards 

(NAAQS) have been exceeded 

(nonattainment area), areas where the 

NAAQS have not been exceeded 

(attainment), and areas that are 

unclassifiable. However, the 

demonstration that must be made to 

obtain a permit and the conditions of 

such permits are different for 

nonattainment and attainment/ 

unclassifiable areas. Thus, the 

pollutant(s) at issue and the air quality 

designation of the area where the 

facility is located or proposed to be built 

determine the specific permitting 

requirements. 

Major sources locating, or located, in 

an area that is in attainment or 

unclassifiable for a particular regulated 

NSR pollutant must obtain a Prevention 

of Significant Deterioration (PSD) 

permit for that pollutant prior to 

constructing or undergoing a major 

modification at the source.8 These PSD 

permits may also cover pollutants for 

which there are no NAAQS.9 Major NSR 

permits for sources that are in an area 

designated nonattainment for a 

particular regulated NSR pollutant, and 

which emit that pollutant in excess of 

the specified nonattainment threshold 

for that pollutant, are referred to as 

nonattainment NSR (NNSR) permits. 

The CAA requires that sources subject 

to PSD meet emission limits based on 

Best Available Control Technology 

(BACT) as specified by CAA section 

165(a)(4), and that sources subject to 

NNSR meet limits based on Lowest 

Achievable Emissions Rate (LAER) 

pursuant to CAA section 173(a)(2). 

Other requirements to obtain a major 

NSR permit vary depending on whether 

the permit is a PSD or NNSR permit. 

A stationary source is subject to major 

NSR requirements if (1) a new stationary 

source is proposed with a potential to 

emit (PTE) a regulated NSR pollutant at 

levels that will meet or exceed statutory 

emissions thresholds,10 such that it 

constitutes a ‘‘major stationary source,’’ 

or (2) an existing major stationary 

source proposes a project that 

constitutes a ‘‘major modification,’’ as 

discussed further in the following 

subsection.11

Projects that do not trigger major NSR 

requirements may still be reviewed 

under SIP-approved preconstruction 

permit programs, known as minor NSR 

programs, to ensure that the NAAQS are 

protected. Under CAA section 110, the 

CAA Parts C and D permitting programs, 

of which NSR is a component, are part 

of a broader requirement to regulate the 


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12Section 110(a)(2)(C) of the CAA requires that 

each SIP ‘‘include a program to provide for the . . . 

regulation of the modification and construction of 

any stationary source within the areas covered by 

the plan as necessary to assure that national 

ambient air quality standards are achieved, 

including a permit program as required in parts C 

and D.’’ See 40 CFR 51.160–164. 

13A minor source that undergoes a physical 

change that would itself be considered major is 

subject to major source requirements. 40 CFR 

52.21(b)(1)(i)(c) (‘‘Any physical change that would 

occur at a stationary source not otherwise 

qualifying under paragraph (b)(1) of this section as 

a major stationary source, if the change would 

constitute a major stationary source by itself’’). 

14 40 CFR 52.21(b)(2). 

15 40 CFR 52.21(b)(52). 

16 40 CFR 52.21(b)(23) defines when emissions of 

listed pollutants are considered significant under 

the federal PSD program. These pollutants include, 

but are not limited to, the following: pollutants for 

which a NAAQS has been promulgated, fluorides, 

and sulfuric acid mist. 40 CFR 51.165(a)(1)(x) 

defines when emissions of listed pollutants are 

considered significant under the federal NNSR 

program. 

17 40 CFR 52.21(b)(23)(ii). Under NNSR, regulated 

NSR pollutants include only pollutants for which 

NAAQS have been established and precursors to 

those pollutants for which the area is designated 

nonattainment. See 40 CFR 51.165(a)(1)(xxxvii). 

The SERs for all these pollutants are enumerated 

under 40 CFR 51.165(a)(1)(x)(A) and part 51, 

appendix S.II.A.10; additionally, per 40 CFR 

52.21(b)(23)(iii), significant also means any 

emissions rate or any net emissions increase 

associated with a major stationary source or major 

modification, which would construct within 10 

kilometers of a Class I area, and have an impact on 

such area equal to or greater than 1 mg/m3 (24-hour 

average). 

18 In 2002, the EPA issued a final rule that 

revised the regulations governing the major NSR 

program. The agency refers generally to this rule as 

the ‘‘NSR Reform Rule.’’ As part of the NSR Reform 

Rule, the EPA revised the NSR applicability 

requirements for modifications to allow sources 

more flexibility to respond to rapidly changing 

markets and plan for future investments in 

pollution control and prevention technologies. 67 

FR 80185 (December 31, 2002). 

19 40 CFR 52.21(b)(7). There are two types of 

emissions units, new and existing. A ‘‘replacement 

unit’’ as defined in the NSR regulations is an 

existing emissions unit. 

20 40 CFR 52.21(b)(7)(i). 

21The ‘‘significant amount,’’ also known as the 

‘‘significant emissions rate’’ for regulated NSR 

pollutants, can be found at 40 CFR 52.21(b)(23). 

22 40 CFR 52.21(b)(41)(ii)(d). A source can also 

opt to use the actual-to-potential test for existing 

units. 

23 40 CFR 52.21(a)(2)(iv)(c) and 40 CFR 

52.21(a)(2)(iv)(f). 

24The ‘‘projected actual emissions’’ of a unit is 

‘‘the maximum annual rate, in tons per year, at 

which an existing emission unit is projected to emit 

a regulated NSR pollutant in any one of the 5 years 

(12-month period) following the date the unit 

resumes regular operation after the project, or in 

any one of the 10 years following that date, if the 

project involves increasing the emissions unit’s 

design capacity or its potential to emit of that 

regulated NSR pollutant and full utilization of the 

unit would result in a significant emissions increase 

or a significant net emissions increase at the major 

stationary source.’’ 40 CFR 52.21(b)(41)(i). 

25 40 CFR 52.21(b)(4). 

26 40 CFR 52.21(b)(48)(iii). 

27 40 CFR 52.21(b)(48). 

construction and modification of 

stationary sources.12 The minor NSR 

program, includes permitting 

requirements for modifications at 

stationary sources that are not major 

modifications (e.g., minor 

modifications) and those requirements 

exist to ensure that changes at a 

stationary source that affect emissions, 

but are not subject to major source 

permitting, do not cause or contribute to 

NAAQS violations.13

B. Major Modifications Under the NSR 

Program 

The EPA’s regulations define ‘‘major 

modification’’ as any physical change or 

change in the method of operation of an 

existing major stationary source that 

would result in a significant emissions 

increase of a regulated NSR pollutant 

and a significant net emissions increase 

of that pollutant from the major 

stationary source.14 The NSR 

regulations define ‘‘project’’ as a 

physical change in, or change in the 

method of operation of, an existing 

major stationary source.15 Following 

from these definitions, the EPA’s 

current implementing regulations 

establish a two-step process for 

determining major NSR applicability: a 

project must result in both (1) a 

significant emissions increase (referred 

to as ‘‘Step 1’’); and (2) a significant net 

emissions increase at the stationary 

source that takes into account emissions 

increases and emissions decreases 

attributable to other projects undertaken 

at the stationary source within a 

contemporaneous timeframe (referred to 

as ‘‘Step 2,’’ or ‘‘contemporaneous 

netting’’). An emissions increase of a 

regulated NSR pollutant is considered 

significant if the increase would be 

equal to or greater than any of the 

pollutant-specific Significant Emissions 

Rates (SERs) listed under the definition 

of ‘‘significant’’ in the applicable PSD or 

NNSR regulations.16 For those regulated 

NSR pollutants not specifically listed, 

any increase in emissions is significant 

for purposes of the PSD program.17 As 

codified in the 2002 NSR Reform Rule,18

Step 1 considers the effect of the project 

alone, and Step 2 considers the effect of 

the project and any other emissions 

changes at the major stationary source 

that are contemporaneous to the project 

(e.g., generally within a 5-year period 

plus construction) and creditable. 

The procedure for calculating whether 

a proposed project would result in a 

significant emissions increase in Step 1 

depends upon the type of emissions 

unit(s) to be included in the proposed 

project, which can be new, existing, or 

a combination of new and existing units 

(i.e., multiple types of emissions 

units).19 A ‘‘new emissions unit’’ is 

defined as ‘‘any emissions unit that is 

(or will be) newly constructed and that 

has existed for less than two years from 

the date such emission unit first 

operated.’’ 20 If a source undertakes a 

project that involves constructing only 

one or more new emissions units, it 

applies the actual-to-potential (ATP) 

test, under which it determines whether 

the sum of the difference between the 

PTE of a regulated NSR pollutant from 

each new emissions unit following 

completion of the project and the 

baseline actual emissions equals or 

exceeds the significant amount for that 

pollutant.21

If the source undertakes a project that 

involves only changes to one or more 

existing emissions units, the source may 

use the actual-to-projected-actual 

(ATPA) test or the ATP test to determine 

the resulting emissions increase.22

Under the ATPA test, a significant 

emissions increase of a regulated NSR 

pollutant is projected to occur if the 

sum of the difference between the 

projected actual emissions and the 

baseline actual emissions for each 

existing emissions unit equals or 

exceeds the significant amount for that 

pollutant.23 If a source undertakes a 

project that includes both new and 

existing emissions units, it must use the 

ATP test to determine the emissions 

change for each new emission unit 

while the source can choose to use 

either the ATPA test or the ATP test for 

each existing unit. 

The ‘‘projected actual emissions’’ of a 

unit is the maximum annual rate, in tpy, 

the existing emissions unit is projected 

to emit a regulated NSR pollutant in the 

future.24 PTE is defined as a unit’s 

maximum capacity to emit a pollutant 

under its physical and operational 

design.25 The baseline actual emissions 

for purposes of determining the 

emissions increase that will result from 

the initial construction and operation of 

a new unit is zero; and thereafter, for all 

other purposes, equals the unit’s PTE.26

Baseline actual emissions for existing 

units are determined based on the rate 

of actual emissions (in tpy) a unit has 

emitted in the past.27

If a source determines that a 

significant emissions increase would 

occur in Step 1, then the source may 

elect to perform the Step 2 

contemporaneous netting analysis to 

determine if a significant net emissions 

increase would not occur at the major 

source and thus conclude the project 

does not trigger major NSR permitting, 

or in the alternative, the source may 

elect to forgo Step 2 and assume PSD or 


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28The project is not a major modification if it 

does not cause a significant emissions increase. If 

the project causes a significant emissions increase, 

then the project is a major modification only if it 

also results in a significant net emissions increase. 

40 CFR 52.21(a)(2)(iv)(a). 

29 40 CFR 52.21(b)(3)(i)(b). 

30 40 CFR 52.21(b)(3)(ii); Permitting authorities 

can select an alternate contemporaneous period if 

approved in their Part D SIP or PSD program. See 

45 FR 53676, 52680 (August 7, 1980). 

31 40 CFR 52.21(b)(3)(iii)(a). 

32 40 CFR 52.21(b)(3)(v). 

33 40 CFR 52.21(b)(3)(i)(b); 40 CFR 52.21(b)(3)(iii); 

40 CFR 52.21(b)(3)(vi). 

34 40 CFR 51.165(a)(1)(vi)(A)(2); 40 CFR 

51.165(a)(1)(vi)(C); 40 CFR 51.165(a)(1)(vi)(E). 

35Prevention of Significant Deterioration (PSD) 

and Nonattainment New Source Review (NNSR): 

Project Emissions Accounting, 85 FR 74890 

(November 24, 2020). 

36The regulations at 40 CFR 52.21 apply to the 

federal PSD program. The EPA has other NSR 

regulations including 40 CFR 51.165, 51.166, and 

appendix S of part 51, that contain analogous 

provisions. We cite 40 CFR 52.21 in this document 

as illustrative, but we propose to revise analogous 

provisions as specified in the regulatory text below. 

To the extent that there are different provisions that 

apply to the other regulations, as in, for example, 

the nonattainment context, that distinction has been 

noted. 

37March 2018 Memorandum. 

38 Id. at 1. 

39 40 CFR 52.21(a)(2)(iv)(g). 

40Prevention of Significant Deterioration (PSD) 

and Nonattainment New Source Review (NNSR): 

Aggregation; Reconsideration, 83 FR 57324 

(November 15, 2018) (‘‘the 2018 final action on 

project aggregation’’ or ‘‘the 2018 Project 

Aggregation Final Action’’). This action completed 

the EPA’s process of reconsidering a 2009 action on 

the topic of ‘‘project aggregation.’’ 

41 85 FR 748895. 

42 74 FR 2376 (January 15, 2009); The EPA stayed 

the 2009 NSR Aggregation Action in response to a 

petition for reconsideration it received on the 2009 

NSR Aggregation Action and, in 2010, as part of the 

reconsideration proceeding, sought comment on the 

2009 NSR Aggregation Action. 

43 Id. at 2378. 

NNSR is triggered.28 Under Step 2, the 

source accounts for all other increases 

and decreases in actual emissions that 

are contemporaneous to the project and 

are creditable.29 An increase or decrease 

in actual emissions is contemporaneous 

if it occurs between 5 years before 

construction on the particular change 

commences and the date that the 

increase from the particular change 

occurs.30 To be creditable, an increase 

or decrease cannot have been previously 

relied upon in the issuance of any NSR 

permit by the reviewing authority; 31

and an increase in actual emissions is 

only creditable to the extent that the 

new level of actual emissions exceeds 

the old level.32 Further, a decrease may 

be accounted for in Step 2 only to the 

extent that (1) the old level of actual 

emissions or the old level of allowable 

emissions, whichever is lower, exceeds 

the new level of actual emissions; (2) it 

is enforceable as a practical matter at 

and after the time that actual 

construction on the particular change 

begins; and (3) it has approximately the 

same qualitative significance for public 

health and welfare as that attributed to 

the increase from the particular 

change.33 In addition, in nonattainment 

areas, emissions reductions are only 

creditable if they have not been relied 

upon for demonstrating attainment or 

reasonable further progress.34

A project that results in a significant 

emissions increase in Step 1 and a 

significant net emissions increase under 

Step 2 of the NSR major modification 

applicability test is considered a major 

modification and requires a major NSR 

permit. 

C. Project Emissions Accounting 

In November 2020, the EPA 

promulgated the PEA rule 35 in which 

the EPA finalized clarifications to the 

Step 1 provisions of the major 

modification applicability test (e.g., 40 

CFR 52.21(a)(2)(iv)).36 The revised 

language clarified that both emissions 

increases and decreases from projects 

may be considered in Step 1 of the NSR 

major modification applicability test, 

regardless of the types of emissions 

units implicated in that project. 

The PEA rulemaking was preceded by 

a March 2018 memorandum from the 

EPA Administrator titled ‘‘Project 

Emissions Accounting Under the New 

Source Review Preconstruction 

Permitting Program.’’ 37 In that 

memorandum, ‘‘the EPA interpreted the 

. . . NSR regulations [pre-2020 PEA 

rule] as providing that emissions 

decreases as well as increases are to be 

considered in Step 1 of the NSR 

applicability process, where those 

decreases and increases are part of a 

single project.’’ 38

The 2020 PEA rule revised the NSR 

regulations to make the permissibility of 

this approach clearer by changing the 

term ‘‘sum of the emissions increase’’ to 

‘‘sum of the difference’’ in the context 

of the hybrid test that applies to projects 

involving multiple types of emissions 

units. That rule also added a provision 

to specify that the term ‘‘sum of the 

difference,’’ as used for all types of units 

(new, existing and the combination of 

new and existing units), shall include 

both increases and decreases in 

emissions as calculated in accordance 

with those subparagraphs.39

D. Project Aggregation 

In the 2020 PEA rule, the EPA also 

concluded that it is appropriate to apply 

its ‘‘project aggregation’’ interpretation 

and policy set forth in a 2018 final 

action on project aggregation 40 in Step 

1 of the NSR major modification 

applicability test for all types of 

projects, including those that involve 

both increases and decreases in 

emissions.41 The 2020 PEA rule 

specified that application of the 2018 

final action on project aggregation may 

assist sources and/or reviewing 

authorities when determining the scope 

of a project in order to avoid the overaggregation or under-aggregation of 

activities that could subsequently be 

considered an effort to circumvent the 

NSR program. The 2020 PEA rule did 

not, however, include any regulatory 

text to require application of that policy 

to determine the scope of a project. 

In the 2018 final action on project 

aggregation, the EPA explained that 

determining what constitutes a 

‘‘project’’ under NSR is a case-by-case 

decision that is both site-specific and 

fact-driven. Because there is no 

predetermined list of activities that 

should be aggregated for a given 

industry or industries, the EPA 

established criteria for determining 

when nominally separate activities are 

considered one project under NSR. 

These criteria included the 

‘‘substantially related’’ standard and the 

three-year rebuttable presumption that 

were contained in the 2009 EPA action 

titled, ‘‘Prevention of Significant 

Deterioration (PSD) and Nonattainment 

New Source Review (NSR): Aggregation 

and Project Netting’’ (‘‘2009 NSR 

Aggregation Action’’).42 In articulating 

what substantially related means, the 

2018 final action on project aggregation 

reaffirmed the 2009 NSR Aggregation 

Action and stated that activities 

occuring in unrelated portions of a 

major stationary source (e.g., a plant that 

makes two separate products and has no 

equipment shared among the two 

processing lines) will not be 

substantially related. The guidance 

further specified that the test of a 

substantial relationship is based on the 

interdependence of the activities, such 

that substantially related activities are 

likely to be jointly planned and occur 

close in time and at components that are 

functionally interconnected.43

The 2009 NSR Aggregation Action 

also added the following: ‘‘[t]o be 

‘substantially related,’ there should be 

an apparent interconnection—either 

technically or economically—between 

the physical and/or operational changes, 

or a complementary relationship 

whereby a change at a plant may exist 

and operate independently, however its 


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44 Id; The 2009 NSR Aggregation Action was 

preceded by a 2006 proposal in which the EPA 

proposed language that ‘‘projects occurring at the 

same major stationary source that are dependent on 

each other to be economically or technically viable 

[should be] . . . considered a single project.’’ 

Prevention of Significant Deterioration (PSD) and 

Nonattainment New Source Review (NSR): 

Debottlenecking, Aggregation, and Project Netting, 

71 FR 54235 (September 14, 2006) (‘‘2006 

proposal’’). The 2006 proposal sought to clarify 

policy that had been discussed in EPA guidance 

documents. See, e.g., ‘‘Applicability of New Source 

Review Circumvention Guidance to 3MMaplewood, Minnesota’’ (June 17, 1993), https://

www.epa.gov/sites/default/files/2015-07/ 

documents/maplwood.pdf. The preamble language 

explained the proposed revisions to the regulatory 

language by stating that ‘‘if a source or reviewing 

authority determines that a project is dependent 

upon another project for its technical or economic 

viability, the source or reviewing authority must 

consider the projects to be a single project and must 

aggregate all of the emissions increases for the 

individual projects in Step 1 of the major NSR 

applicability analysis.’’ 71 FR 54235, 54245 

(September 14, 2006). 

45 Id. 

46 Id. 

47 83 FR 57326. 

48 Id. at 57327 (citing 74 FR 2380, 2380). 

49Petition for Reconsideration at 5. 

50 In New Jersey v. EPA, the D.C. Circuit upheld 

the EPA’s 2007 reasonable possibility rule, stating 

that the EPA ‘‘offered a rational basis for adopting 

the 50 percent trigger.’’ 989 F.3d 1038, 1051 (D.C. 

Cir. 2021). The court recognized that in the 

preamble of the 2007 reasonable possibility rule, 

the EPA ‘‘strove for a balance between ease of 

enforcement and avoidance of requirements that 

would be unnecessary or unduly burdensome on 

reviewing authorities or the regulated community.’’ 

Id. The court also recognized in its ruling that the 

EPA solicited comment on other percentage 

increase triggers and that the EPA’s ‘‘final rule 

accounted for variability in projections due to 

demand growth emissions and thereby addressed 

the principal objection of commenters, including 

[the] petitioner[s], to the 50 percent trigger.’’ Id. 

51 85 FR 74890, 74895 (November 24, 2020). 

52As noted earlier, this proposal refences 40 CFR 

52.21 as one such place where the applicable 

regulations may be found, but there are other NSR 

regulations that contain the same language. 

benefit is significantly reduced without 

the other activity.’’ 44

The 2009 NSR Aggregation Action 

also stated that timing could be a basis 

for not aggregating separate projects, 

and it established a rebuttable 

presumption against aggregating 

projects that occur three or more years 

apart. The EPA justified its selection of 

three years as the presumptive 

timeframe in part by reasoning that 

three years ‘‘is long enough to ensure a 

reasonable likelihood that the 

presumption of independence will be 

valid, but is short enough to maintain a 

useful separation between relevant 

construction cycles, consistent with 

industry practice.’’ 45 However, the EPA 

did note that this presumptive 

timeframe may be rebutted in certain 

circumstances. For instance, the 2009 

NSR Aggregation Action noted that 

where there is ‘‘evidence that a 

company intends to undertake a phased 

capital improvement project’’ where the 

activities ‘‘have a substantial economic 

relationship,’’ this would likely 

overcome the presumption that those 

activities should not be aggregated.46

The 2009 NSR Project Aggregation 

Final Action and subsequent 2018 final 

action on project aggregation were 

developed to ensure ‘‘that NSR is not 

circumvented through some artificial 

separation of activities at Step 1 of the 

NSR applicability analysis where it 

would be unreasonable for the source to 

consider them to be separate 

projects.’’ 47 Given this aim, the 2018 

final action on project aggregation 

affirmed the example provided in the 

2009 NSR Aggregation Action that 

phased capital improvement projects 

comprised of activities that have a 

substantial economic relationship 

between one another may need to 

overcome the presumption towards 

aggregation.48

In 2018, a different consideration 

arose from the EPA’s effort to make clear 

that sources can account for decreases at 

Step 1. Commenters and petitioners on 

the 2020 PEA rule expressed concern 

that sources could over-aggregate 

activities in order to circumvent NSR. In 

other words, sources may be able to 

‘‘avoid NSR by grouping multiple 

activities into a ‘project’ and only 

requiring NSR if the ‘project,’ taken 

together, will produce a significant 

emissions increase.’’ 49 This concern is 

manifest only when some of aggregated 

activities produce quantifiable 

emissions decreases that are used to 

offset emissions increases from other 

activities, thus increasing the likelihood 

that the net emissions from the 

collection of activities would be at 

levels below the thresholds at which 

major NSR applies. The EPA proposes 

to address this concern with revisions to 

the language defining ‘‘project’’ within 

the NSR regulations, as explained in 

further detail in section III. of this 

action. 

E. ‘‘Reasonable Possibility’’ 

Recordkeeping and Reporting Provisions 

In 2002, the EPA adopted 

recordkeeping and reporting 

requirements to help permitting 

authorities and stakeholders oversee 

compliance with NSR requirements at 

sources that determine a modification 

does not trigger major NSR 

requirements. Under those 

requirements, sources that saw no 

reasonable possibility that post-change 

emissions would prove higher than past 

actual emissions were not required to 

keep records. In 2005, the D.C. Circuit 

Court remanded this ‘‘reasonable 

possibility’’ recordkeeping and 

reporting provision to the EPA, holding 

that the ‘‘EPA failed to explain how it 

can ensure NSR compliance without the 

relevant data’’ and directed the EPA 

‘‘either to provide an acceptable 

explanation for its ‘reasonable 

possibility’ standard or to devise an 

appropriately supportive alternative.’’ 

New York v. EPA, 413 F.3d 3, 35 (D.C. 

Cir. 2005). The EPA promulgated rules 

in 2007 to define ‘‘reasonable 

possibility,’’ which the D.C. Circuit 

Court upheld in a 2020 decision. New 

Jersey v. EPA, 989 F.3d 1038 (D.C. Cir. 

2021).50

In the 2020 PEA rule, the EPA 

concluded that the provisions at 40 CFR 

52.21(r)(6) and other locations in the 

NSR rules (the ‘‘reasonable possibility’’ 

or ‘‘RP’’ provisions) are adequate to 

ensure sufficient monitoring, 

recordkeeping and reporting of 

emissions for projects determined not to 

trigger major NSR, after considering 

both emissions increases and decreases 

from the project in Step 1 of the NSR 

major modification applicability test.51

The reasonable possibility provisions 

apply to projects involving existing 

emissions units at a major stationary 

source in circumstances where the 

owner or operator elects to use projected 

actual emissions in determining the 

emissions increase resulting from 

changes at such unit(s) and where there 

is a reasonable possibility (as defined in 

40 CFR 52.21(r)(6)(vi)) that a project that 

is not considered a major modification 

may nevertheless actually result in a 

significant emissions increase. When 

the reasonable possibility criteria in 40 

CFR 52.21 are triggered,52 specific preand post-project recordkeeping, 

monitoring, and reporting requirements 

in paragraph 40 CFR 52.21(r)(6) must be 

met, depending on the circumstances. 

As defined in the regulations, a 

reasonable possibility exists when the 

owner or operator calculates the project 

to result in either: (1) a projected actual 

emissions increase of at least 50 percent 

of the amount that is a ‘‘significant 

emissions increase’’ for the regulated 

NSR pollutant; or (2) a projected actual 

emissions increase that, added to the 

amount of emissions excluded, sums to 

at least 50 percent of the amount that is 

a ‘‘significant emissions increase’’ for 

the regulated NSR pollutant. For a 

project for which a reasonable 

possibility exists only under criterion 

(2), and not also within the meaning of 

criterion (1), the RP provisions at 


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53 40 CFR 52.21(r)(6)(iv). 

54Under 40 CFR 52.21(b)(41)(ii)(c) sources ‘‘shall 

exclude, in calculating any increase in emissions 

that results from the particular project, that portion 

of the unit’s emissions following the project that an 

existing unit could have accommodated during the 

consecutive 24-month period used to establish the 

baseline actual emissions . . . and that are also 

unrelated to the particular project, including any 

increased utilization due to product demand 

growth.’’ 

55 40 CFR 51.165(a)(1)(xxxix); 40 CFR 

51.166(b)(51); 40 CFR part 51, appendix S II.A.33.; 

40 CFR 52.21(b)(52). 

56Sierra Club, et al., Response to Request for 

Comments on Proposed Rule: Prevention of 

Significant Deterioration (PSD) and Nonattainment 

New Source Review (NNSR): Project Emissions 

Accounting, 84 FR 39244 (August 9, 2019) at 5; see 

also Petition for Reconsideration at 4; comment 

from Steve Odendahl, Manager Air Law for All, Ltd. 

Re: Docket ID No. EPA–R04–OAR–2022–0397 

(August 25, 2022) at page 4. 

57 85 FR 74890, 74898 (November 24, 2020). 58 Id. at 74899. 59Petition for Reconsideration at 6–10. 60States would generally be required to update 

their NSR regulations to incorporate the new 

definition of project and submit those regulations 

to the EPA for approval into the SIP. 

(r)(6)(ii) through (v) do not apply to the 

project. Among other requirements, the 

RP provisions at (r)(6)(ii), (vi), and (v) 

require that the owner or operator of an 

electric utility steam generating unit 

(EUSGU) submit a copy of the 

information recorded under the RP 

provisions to the reviewing authority. 

Additionally, under the monitoring 

provisions at 40 CFR 52.21(r)(6)(iii), as 

applicable, sources must calculate and 

maintain a record of annual emissions 

in tpy on a calendar year basis for a 

period of 5- or 10-years following 

resumption of regular operations after 

the change, depending on the type of 

change at the unit(s). Post-project 

annual reporting is required for projects 

involving EUSGUs, whereas for projects 

not involving EUSGUs, owners or 

operators need only maintain postproject records on-site and submit a 

report if certain criteria listed in the 

regulations are met.53 In accordance 

with 40 CFR 52.21(r)(7), the information 

required to be documented and 

maintained pursuant to paragraph 40 

CFR 52.21(r)(6) shall be available for 

review upon a request for inspection by 

the reviewing authority or the general 

public. The requirements of 40 CFR 

52.21(r)(6) apply equally to units with 

projected increases and projected 

decreases in emissions, as long as there 

is a reasonable possibility that the 

project could result in significant 

emissions increase and those units are 

part of the project (e.g., their emissions 

‘‘could be affected’’ by the project). 

Projects that do not meet the reasonable 

possibility criteria are not subject to any 

specific recordkeeping requirements 

under the Federal regulations. 

For projects that trigger the reasonable 

possibility standard for one or more 

regulated NSR pollutants, the records 

that the owner or operator must 

maintain include (a) a description of the 

project; (b) identification of the 

emissions unit(s) whose emissions of a 

regulated NSR pollutant could be 

affected by the project; and (c) a 

description of the applicability test used 

to determine that the project is not a 

major modification for any regulated 

NSR pollutant, including the baseline 

actual emissions, the projected actual 

emissions, the amount of emissions 

excluded including an explanation for 

why such amount was excluded, and 

any netting calculations, if applicable.54

In this action, the EPA is proposing 

revisions to the reasonable possibility 

standard to further clarify how the 

recordkeeping and reporting provisions 

are intended to apply. The EPA is also 

proposing to strengthen the standard to 

improve accountability in those 

instances where the PEA rule is applied. 

These revisions are presented in section 

VI. of this action. 

III. Proposed Definition of ‘‘Project’’ 

In this action, the EPA is proposing to 

revise the existing definition of 

‘‘project’’ in the major NSR regulations. 

The term ‘‘project’’ is currently defined 

as ‘‘a physical change in, or change in 

the method of operation of, an existing 

major stationary source.’’ 55 The EPA’s 

proposed revision would add detail to 

this definition in a manner consistent 

with the 2018 final action on project 

aggregation. The EPA is proposing to 

further define a project as ‘‘a discrete 

physical change in, or change in the 

method of operation of, an existing 

major stationary source, or a discrete 

group of such changes (occurring 

contemporaneously at the same major 

stationary source) that are substantially 

related to each other. Such changes are 

substantially related if they are 

dependent on each other to be 

economically or technically viable.’’ 

In comments on the 2020 PEA rule 

and in the petition for reconsideration, 

some stakeholders expressed a concern 

that the 2020 PEA rule would enable a 

source to avoid NSR by grouping 

multiple activities into a ‘‘project’’ and 

only requiring NSR if the ‘‘project,’’ 

taken together, will produce a 

significant emissions increase. The 

comments add that this would allow 

source owners/operators to consider 

only emissions offsets that they 

selectively pair with the change as a 

part of the ‘‘project’’ and would allow 

source owners/operators to disregard an 

actual source-wide emissions increase 

resulting from the change being 

permitted.56

In the final 2020 PEA rule, the EPA 

stated that ‘‘the application of the 

‘substantially related’ test of the 2018 

final action on project aggregation 

should be sufficient to prevent sources 

from arbitrarily grouping activities for 

the sole purpose of avoiding the NSR 

major modification requirements 

through project emissions 

accounting.’’ 57 The EPA added in that 

rulemaking that ‘‘the ‘substantially 

related’ test . . . applies to prevent 

aggregating into a single project those 

activities that do not represent such 

project, so decreases from activities that 

do not meet this test should not be 

considered in Step 1.’’ 58 In the final 

rule, however, the EPA did not include 

regulatory text to require application of 

the provisions contained in the 2018 

final action on project aggregation. The 

EPA is now proposing a definition of 

‘‘project’’ that would codify a definition 

that is consistent with the 2018 final 

action on project aggregation. 

The EPA is proposing changes to the 

definition of ‘‘project’’ to address 

concerns raised in the petition for 

reconsideration and in comments 

submitted on the PEA rule. Both the 

petition for reconsideration and 

comments on the 2020 PEA rule argued 

that a more-specific definition of a 

‘‘project’’ would guard against 

circumvention of the NSR applicability 

process. Indeed, in their petition for 

reconsideration, petitioners argued that 

the EPA’s 2020 PEA rule was flawed 

because it failed to ensure that 

emissions decreases taken in Step 1 to 

avoid NSR applicability result from the 

change being evaluated. Further 

petitioners noted that nothing in the 

final rule required states to use the 

‘‘substantially related’’ test, and that 

EPA’s statement that the ‘‘substantially 

related’’ would be appropriate for 

determining if decreases can be 

accounted for in Step 1 was 

insufficient.59 By introducing a 

definition of ‘‘project’’ that codifies the 

2018 project aggregation guidance, the 

EPA hopes to address these concerns. 

The EPA agrees with commenters that 

a more specific regulatory definition of 

project would provide greater clarity 

regarding the activities included within 

the scope of a project for the purpose of 

determining whether the project 

constitutes a major modification under 

the NSR regulations.60 The EPA has 

recognized that some line must be 

drawn between those activities that 

constitute a single ‘‘physical change 

. . . or change in the method of 


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61See, e.g., 71 FR 54244, 54245 (describing the 

EPA’s development of an aggregation policy ‘‘to 

ensure the proper permitting of modifications that 

involve multiple projects’’). 

62 Id. 

63 In the 2018 final action on project aggregation 

the EPA stated that ‘‘We acknowledge that, by not 

making any changes to the regulatory text, as had 

been proposed, it may have been somewhat unclear 

to some whether state and local air agencies have 

to adopt or implement the elements of the 2009 

NSR Aggregation Action, and, if so, how they 

should do so.’’ 

64See, e.g., ‘‘Comments of the Utility Air 

Regulatory Group on the Environmental Protection 

Agency’s Proposed Rule Concerning Prevention of 

Significant Deterioration (PSD) and Nonattainment 

New Source Review (NSR): Aggregation; 

Reconsideration (April 15, 2010),’’ Docket EPA– 

HQ–OAR–2003–0064; ‘‘Comments of Toyota Motor 

Engineering & Manufacturing North America (Nov. 

13, 2006),’’ Docket EPA–HQ–OAR–2003–0064; 

‘‘Comments of Chevron Corporation (November 10, 

2006),’’ Docket EPA–HQ–OAR–2003–0064. 

65See, e.g., In the Matter of Suncor Energy 

(U.S.A.), Inc. Commerce City Refinery, Plant 2 

(East), Order on Petition Nos. VIII–2022–13 & VIII– 

2022–14, pages 72–77 (July 31, 2023) (requiring 

that, in the absence of applying the EPA’s 2018 

Project Aggregation Final Action, the review 

authority ‘‘must ensure that its NNSR applicability 

determination . . . including the decision not to 

aggregate . . . changes with similar changes . . . is 

based on reasonable grounds and properly 

supported by the permit record.’’); see also In the 

Matter of Consolidated Environmental 

Management, Inc.—Nucor Steel Louisiana, Order on 

Petition Nos. VI–2010–02 & VI–2011–03 (March 23, 

2012) (finding that the reviewing authority ‘‘did not 

analyze any regulatory definition of ‘project,’ such 

as the definition in 40 CFR 52.21(b)(52), before 

applying that term’’ and that ‘‘while [the reviewing 

authority] suggests that [the source] has not 

attempted to split the projects to avoid PSD 

permitting because both processes were subject to 

PSD review . . . this statement does not address 

whether [the reviewing authority’s] PSD review 

adequately addressed the full scope of the source).’’ 

66CAA section 111(a)(4); CAA section 165(a)(3). 

67CAA section 111(a)(4). 

68 40 CFR 52.21(b)(52). 

69 40 CFR 52.21(a)(2). 

70 85 FR 74898. 

71Response to Comments Document on Proposed 

Rule: ‘‘Prevention of Significant Deterioration (PSD) 

and Nonattainment New Source Review (NNSR): 

Project Emissions Accounting’’—84 FR 39244, 

August 9, 2019 at 73–5 (October 2020). 

operation’’ and those changes at a 

source that are separate.61 Historically, 

the EPA developed a policy on 

determining the scope of a ‘‘project,’’ 

which evolved largely ‘‘from specific, 

case-by-case after-the-fact inquiries 

related to the possible circumvention of 

NSR in existing permits.’’ 62 The 

subsequent issuance of final actions 

reflecting EPA interpretations and 

policy, while providing additional 

clarity, did not establish legal 

requirements and did not create 

consistency with respect to the 

application of Step 1 by reviewing 

authorities.63 Several commenters on 

prior EPA actions regarding project 

aggregation noted that there is evidence 

in the rulemaking record that NSR 

applicability decisions based upon 

informal guidance and letters creates 

confusion.64 The EPA is, therefore, 

proposing to adopt a controlling 

definition of ‘‘project’’ that is ‘‘a discrete 

physical change in, or change in the 

method of operation of, an existing 

major stationary source, or a discrete 

group of such changes (occurring 

contemporaneously at the same major 

stationary source) that are substantially 

related to each other. Such changes are 

substantially related if they are 

dependent on each other to be 

economically or technically viable.’’ 

Concerns of over- and underaggregation illustrate the need for 

adding criteria to the NSR regulations 

for determining when nominally 

separate changes should be considered 

a single ‘‘project’’ for purposes of 

determining NSR applicability. The EPA 

has found that in some cases activities 

were not aggregated despite evidence 

that they were substantially related. In 

those instances, project disaggregation 

determinations were made without 

documentation for such a 

determination.65 The EPA is seeking 

comments on examples of under- or 

over-aggregation of activities, e.g., 

aggregation of activities without regard 

to technical and economic 

interrelatedness, and disaggregation of 

activities into multiple projects leading 

source to forgo major NSR requirements. 

Based on these concerns, the EPA 

therefore finds it necessary to establish 

a controlling standard in its regulations 

to draw a line between those activities 

that are to be considered a single 

‘‘physical change or change in the 

method of operation’’ (i.e., project) and 

those that are separate. The EPA is 

proposing to adopt a revised definition 

of project to clarify the activities that 

must be considered when evaluating 

whether a project (i.e., a physical 

change or change in the method of 

operation or a modification) is a major 

modification subject to NSR permitting 

requirements.66

Under the applicability analysis 

framework in the EPA’s NSR 

regulations, it is important to accurately 

determine which activities should be 

considered part of a single project (i.e., 

modification). There are consequences 

to either under- or over-aggregating 

activities; namely that sources 

undergoing modifications may 

inconsistently use the flexibility of 

imprecise regulatory provisions to 

systematically avoid major source NSR. 

This potential pitfall of aggregation 

arises because the regulatory framework 

provides avenues to disaggregate 

‘‘projects.’’ The CAA definition of 

‘‘modification’’ as ‘‘any physical change 

. . . or change in the method of 

operation’’ leaves ambiguity as to what 

activities are to be included in the 

source ‘‘modification’’ when the source 

may be undertaking contemporaneous 

activities that may all increase the 

source’s emissions.67 The EPA has 

previously only defined a ‘‘project’’ as 

‘‘a physical change in, or change in the 

method of operation of, an existing 

major stationary source.’’ 68 A ‘‘project’’ 

is a major modification for a regulated 

NSR pollutant if it causes a significant 

emissions increase (as defined at 40 CFR 

52.21(b)(40)) and a significant net 

emissions increase (as defined in 

paragraphs (b)(3) and (b)(23) of 40 CFR 

52.21).69

This definition may not be sufficient 

to guard against the potential for sources 

to selectively aggregate or disaggregate 

multiple projects such that they are able 

to avoid major NSR in a manner that is 

contrary to the intent of the CAA. The 

rule revisions proposed in this action 

aim to bring additional clarity and 

consistency by providing a controlling 

standard that allows reviewing 

authorities to identify situations where 

activities should be grouped together or 

separated. By adopting a more specific 

definition of ‘‘project,’’ this action, if 

finalized as proposed, would enhance 

the ability of reviewing authorities to 

enforce against avoidance of major NSR 

requirements due to the improper 

aggregation or disaggregation of 

activities. 

In the 2020 PEA rule, the EPA 

referenced the 2018 Project Aggregation 

Final Action in recognition that ‘‘it is 

appropriate to limit the scope of 

emissions decreases that can be 

considered at Step 1 to only the project 

under review and to not allow sources 

to attempt to avoid NSR by expanding 

the scope of decreases to those that are 

not truly part of the project.’’ 70 But the 

EPA did not require application of the 

2018 Project Aggregation Final Action 

in the 2020 PEA rule. The EPA 

responded to comments stating ‘‘if PEA 

is to be allowed, the ‘substantially 

related’ standard must be applied to the 

activities that result in emissions 

increases and decreases,’’ by stating that 

‘‘applying the ‘substantially related’ 

criteria on project aggregation for those 

reviewing authorities that implement 

PEA should alleviate any concerns 

about potential NSR circumvention as 

part of Step 1 of the major modification 

applicability test.’’ 71 Therefore, the EPA 

predicated finalization of the PEA rule 

on the basis that the 2018 Project 

Aggregation Final Action, or some 


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72 85 FR 74890, 74900. 73Supra note 67. 74 In the 2018 final action on projection 

aggregation, the EPA argued that the ‘‘substantially 

related’’ test would not result in the elimination of 

a type of physical change that Congress intended to 

cover (i.e., the change that consists of the group of 

nominally-separate changes that comprise a project 

but do not qualify as ‘substantially related’). In that 

final action, the EPA reasoned that a ‘‘common 

meaning’’ of a single ‘‘change’’ would not include 

multiple changes that are not substantially related, 

such as changes that are undertaken at a source at 

different times, or undertaken for different 

purposes, or are otherwise related to each other. 83 

FR 57332. 75Supra note 67. 

76See Virginia Department of Environmental 

Quality (VDEQ) comments on the Prevention of 

Significant Deterioration (PSD) and Nonattainment 

New Source Review (NNSR): Project Emissions 

Accounting (84 FR 39244) at page 3 (noting that the 

ability of ‘‘existing major sources to engage in a 

nearly continuous series of projects to increase 

efficiency, reduce cost and improve product quality 

for decreases’’ lends itself to a potential ‘‘double 

counting’’ issue). 

77 40 CFR 52.21(b)(41)(ii)(c). 

analogous definition of project, would 

be applied by permitting authorities to 

prevent circumvention of the NSR 

program requirements with the 

application of PEA, yet did not establish 

such a requirement in that rule. The 

EPA is therefore proposing in this action 

to codify a definition of a project 

consistent with the 2018 Project 

Aggregation Final Action to alleviate the 

potential for NSR circumvention that it 

highlighted in the 2020 PEA rule and 

Response to Comments document to 

that action.72 The EPA is proposing this 

in light of evidence that the 2018 Project 

Aggregation Final Action or some 

similar definition of ‘‘project’’ is, in 

some instances, not being applied by 

reviewing authorities.73

The project definition criteria in the 

2018 Project Aggregation Final Action 

are appropriate criteria for defining a 

project and comport within the purpose 

and language of the CAA.74 More 

specifically, activities that occur at the 

same major stationary source that are 

dependent on each other to be 

economically or technically viable 

should be considered a single project. If 

finalized, the proposed definition of 

project will enable a more consistent 

application of the aggregation criteria by 

both those considering the applicability 

of NSR to proposed modifications as 

well as for those conducting an afterthe-fact inquiry regarding whether NSR 

was circumvented through the failure to 

aggregate dependent physical or 

operational changes at a source (or overaggregation of unrelated activities). 

When considered with application of 

PEA, a more specific definition of 

project would help ensure that 

emissions decreases accounted for 

under Step 1 of the NSR applicability 

process are substantially related to other 

activities comprising the physical 

change or change in the method of 

operation (i.e., a project) at the source. 

Upon finalization of this element of this 

proposed action, any decrease in 

emissions accounted for under Step 1 of 

the NSR applicability test must be 

substantially related to the other 

activities involved in the project. 

Therefore, for the reasons discussed in 

the 2018 Project Aggregation Final 

Action, multiple changes that are 

‘‘substantially related’’ would be 

considered one project for purposes of 

determining NSR applicability. 

Reviewing authorities that do not allow 

for project emissions accounting at Step 

1 would still benefit from a codified 

definition of ‘‘project’’ as greater 

specificity can allow for identification 

of, and enforcement against, situations 

where a source may seek to avoid major 

NSR requirements by disaggregating 

activities that are ‘‘substantially 

related.’’ 

The EPA is not proposing that this 

definition of project include a specific 

timeframe that defines ‘‘occurring 

contemporaneously,’’ such as the threeyear rebuttable presumption from the 

2018 Project Aggregation Final Action. 

Since promulgation of the 2018 Project 

Aggregation Final Action, the EPA has 

obtained information that suggests a 

three-year timeframe may not 

adequately represent the wide variety of 

projects performed across all source 

categories. For example, while the EPA 

has become aware of several multi-year 

expansion projects that span more than 

three years, the EPA does not have 

information on the percentage of 

projects that that involve activities 

occurring within any specific time 

period.75 Accordingly, the EPA is taking 

comment on whether a specific 

temporal component of the project 

aggregation criteria, i.e., the three-year 

rebuttable presumption contained in the 

2018 final action on project aggregation 

should be retained. The EPA is 

requesting comment on this proposed 

definition of ‘‘project,’’ including 

whether the proposed relationshipbased aggregation criteria are 

appropriate and whether there would be 

any potential issues with implementing 

the definition for any particular type of 

project or source category. 

In the event the EPA finalizes a 

temporal component to the definition of 

project, the EPA is soliciting comment 

on whether a rebuttable presumption 

should be retained. The EPA requests 

comments on the proposed codification 

of the ‘‘substantially related’’ test 

without the presumption, as well as any 

comments that may support, in the 

alternative, codifying a rebuttable timebased presumption of three years or 

some other period. The EPA requests 

that comments in support of a rebuttable 

time-based presumption provide 

evidence of why the presumption and 

associated time-period would be 

appropriate for purposes of NSR 

applicability across affected source 

types. 

Irrespective of the finalization of this 

proposal, the EPA advises that 

permitting authorities scrutinize project 

determinations in those cases where a 

source concurrently submits a major 

and minor NSR permit application, 

when the source submits multiple 

minor NSR permit applications within a 

short period of time, or where there is 

otherwise evidence that some or all of 

the activities associated with those 

permit applications may be 

substantially (i.e., technically and 

economically) related. The EPA would 

like information on the impacts the 

definition of ‘‘project’’ proposed in this 

action, if finalized, would have in 

safeguarding against potential overaggregation or under-aggregation of 

projects with the intent to circumvent 

major NSR. 

IV. Safeguard Against ‘‘Double 

Counting’’ of Emissions Decreases and 

Increases 

The EPA is requesting comment on 

the potential, within a project emissions 

accounting framework, for source 

owners or operators to ‘‘double count’’ 

emissions decreases across multiple 

projects, and whether the NSR 

regulations should include language to 

prevent this.76 The definition of 

projected actual emissions provides that 

the owner or operator ‘‘[s]hall exclude, 

in calculating any increase in emissions 

that results from the particular project, 

that portion of the unit’s emissions 

following the project that an existing 

unit could have accommodated during 

the consecutive 24-month period used 

to establish the baseline actual 

emissions . . . and that are also 

unrelated to the particular project, 

including any increased utilization due 

to product demand growth.’’ 77

However, there is no corresponding 

provision that limits eligible emissions 

decreases to only those that result from 

the project being evaluated (i.e., a 

decrease from an existing emissions unit 

is simply calculated as the difference 

between projected actual emissions and 

baseline actual emissions). Therefore, it 

seems possible that a decrease resulting 

from an earlier project (one completed 

after the selected baseline actual 


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78Under the existing NSR regulations, baseline 

actual emissions must be adjusted downward to 

exclude any emissions that would have exceeded 

an emission limitation with which the source must 

currently comply, which would include any limits 

imposed to qualify decreases as part of prior step 

1 applicability analyses involving a common unit 

or units. 

79The EPA is also proposing analogous regulatory 

language for 40 CFR 51.165, 40 CFR 51.166, and 

appendix S to 40 CFR part 51. 

80CAA section 110(a)(2)(B) and (C). 

81Petition for Reconsideration at 11–12. 

82Sierra Club, et al., Response to Request for 

Comments on Proposed Rule: Prevention of 

Significant Deterioration (PSD) and Nonattainment 

New Source Review (NNSR): Project Emissions 

Accounting, 84 FR 39244 (August 9, 2019) at 13– 

24. 

83 Id. 

84 67 FR at 80204. 

emissions period) could be accounted 

for in a subsequent project being 

evaluated, even if that project had no 

causal relationship to the decrease. The 

EPA acknowledges that this situation 

can occur when multiple projects 

during the baseline actual emissions 

determination timeframe involve the 

same existing emissions unit, but the 

Agency believes that ‘‘double counting’’ 

of emissions decreases will be 

addressed by the requirement 

(discussed below) that any decreases be 

made enforceable in order to be eligible 

for consideration in the Step 1 

applicability calculation.78 The EPA is 

nonetheless requesting comment on 

adding a provision in the NSR 

regulations to require that the baseline 

actual emissions of a unit with a 

projected decrease in emissions be 

adjusted to account for any portion of 

that decrease in emissions that would 

not result from (i.e., is unrelated to) the 

project being evaluated, but would also 

like commenters to suggest alternatives 

to this language. 

The EPA is aware that the potential 

also exists for ‘‘double counting’’ 

emissions increases under the existing 

regulations, such that major NSR may be 

triggered when a project itself would not 

result in a significant emission increase. 

For example, when projecting emissions 

from an affected existing emissions unit 

for Project A (the current project) a 

source must also consider whether any 

future separate project(s) during the 

required projection period (i.e., 5 or 10 

years after resuming regular operation) 

may affect the projected actual 

emissions from the unit, and if that 

affect is an increase that the unit could 

not have accommodated during the 

selected baseline period, that increase 

must be accounted for as part of the 

project applicability analysis for Project 

A. This may result in a situation where 

emissions increases are ‘‘double 

counted’’ in the NSR applicability 

process. 

Thus, the possibility for ‘‘double 

counting,’’ or imperfect allocation of 

emissions increases and decreases to a 

project, exists in limited circumstances, 

but revising the regulations to 

completely address any such possible 

situations would add significant 

complexity and it is unclear whether 

any such revisions are necessary or 

warranted. The EPA is requesting 

comment on the prevalence of either of 

these forms of ‘‘double counting,’’ 

specific examples, if applicable, of each, 

and whether the EPA should revise the 

NSR regulations to address one or both 

of these possible issues and, if so, how 

it should revise the regulations to rectify 

this potential issue. 

V. Enforceability of Emissions 

Decreases 

The EPA is proposing, in a distinct 

and severable portion of this proposal, 

to require that decreases associated with 

a project under the Step 1 significant 

emissions increase determination be 

legally and practicably enforceable (i.e., 

enforceable as a practical matter). The 

EPA is proposing to revise the 

regulations accordingly by adding ‘‘a 

decrease may only be accounted for in 

the significant emissions increase 

determination if it meets the 

requirements under 40 CFR 

52.21(b)(3)(vi)(b)’’ to the ‘‘significant 

emissions increase’’ definition at 40 

CFR 52.21(a)(2)(iv)(g).79

The EPA is proposing this change as 

a safeguard to ensure that emissions 

decreases that are accounted for in the 

NSR applicability process will occur 

and be maintained. This is consistent 

with the requirement under CAA 

section 110 that ‘‘each implementation 

plan submitted by a State include 

enforceable emission limitations’’ and 

‘‘regulation of the modification and 

construction of any stationary source 

within the areas covered by the plan as 

necessary to assure that national 

ambient air quality standards are 

achieved, including a permit program as 

required in parts C and D of this 

subchapter.’’ 80 The EPA is proposing 

this change to address concerns raised 

in the petition for reconsideration. 

Petitioners argued that under the 2020 

PEA rule the EPA lacked oversight such 

that it cannot ensure that projected 

emission decreases will occur, or that 

they will be maintained over time.81 A 

similar concern was expressed by 

commenters to the 2020 PEA rule, who 

argued the rule ‘‘would make NSR 

requirements unenforceable[,]’’ and that 

finalization of the 2020 PEA rule was 

unlawful because ‘‘EPA fails to require 

that . . . decreases [accounted for in 

Step 1] be . . . enforceable as a practical 

matter.’’ 82 These commenters argued 

that enforceability is a regulatory 

safeguard that is required to ensure that 

any emission decreases relied upon to 

offset an otherwise emissions-increasing 

change are real and will remain in 

effect.83 In proposing enforceability of 

decreases accounted for in Step 1, the 

EPA hopes to provide sufficient 

oversight that will address petitioners 

and commenters concerns. 

Under the existing NSR regulations, 

projected actual emissions are not 

required to be made enforceable, 

regardless of whether the result of the 

calculation is an emission increase or 

decrease. In some cases, a projection 

may be enforceable, at least in part, if it 

is based on separate CAA legal authority 

(e.g., NSPS, NESHAP, SIP), but there is 

no independent requirement in the NSR 

applicability procedures for such 

enforceability. In the 2002 NSR Reform 

Rule, the EPA elected not to require that 

projected actual emissions be made 

enforceable because establishing such a 

requirement may have ‘‘place[d] an 

unmanageable resource burden on 

reviewing authorities’’ and because the 

EPA did not believe at that time that it 

was necessary to make future 

projections enforceable in order to 

adequately enforce the major NSR 

requirements.84 However, with the more 

explicit recognition that decreases in 

emissions may be considered in the 

Step 1 significant emissions increase 

determination, there may be reason to 

require that such decreases be 

enforceable. Because of the predominant 

impact that one or more claimed 

decreases in emissions involved in a 

project could have on the determination 

of whether the project constitutes a 

major modification, additional 

safeguards are appropriate to ensure that 

such decreases actually occur and that 

they are maintained. The existing 

framework under the reasonable 

possibility provisions and the revisions 

to that framework proposed in this 

action may be insufficient to provide 

that assurance. While the revisions 

proposed to the ‘‘reasonable possibility’’ 

provisions in section VI. of this action 

will allow reviewing authorities to 

verify that decreases accounted for at 

Step 1 by source owner or operators 

actually occur, they may not provide 

adequate recourse to reviewing 

authorities if the decreases do not occur 

as projected. While source owners or 

operators are required to submit a report 

to the reviewing authority when 

emissions differ from preconstruction 


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85 40 CFR 52.21(r)(6)(v). 

86New Jersey v. EPA, 989 F.3d 1038 (D.C. Cir. 

2021) (citing New York, 413 F.3d at 44 (Williams 

J., concurring)). 

projections, this requirement only 

applies when actual emissions exceed 

baseline actual emissions ‘‘by a 

significant amount’’ for the regulated 

NSR pollutant.85 Consequently, source 

owner or operators may overestimate 

emissions decreases at Step 1 with no 

recourse provided actual emissions are 

not significant. 

The EPA is thus proposing to revise 

the existing definition of ‘‘significant 

emissions increase’’ in the major NSR 

regulations to add that a decrease can 

only be accounted for at Step 1 if it 

meets the creditability requirements for 

decreases in the existing ‘‘significant net 

emissions increase’’ definition. The EPA 

is taking comment on this proposed 

requirement. Specifically, the EPA is 

requesting input from commenters on 

the types of projects that would be 

impacted by a requirement that 

emission decreases accounted for under 

Step 1 of the NSR applicability process 

be enforceable prior to beginning actual 

construction and the effect that such a 

requirement would have on project 

decision-making and project outcomes. 

The EPA is also requesting comment on 

the following questions related to this 

proposal: 

• How would a requirement that 

emissions decreases under Step 1 meet 

the criteria currently applicable to 

decreases accounted for under Step 2 

impact accountability and enforceability 

of emissions limitations? 

• How can the EPA justify a 

distinction with respect to 

enforceability requirements by 

differentiating projections resulting in 

an increase versus those projections that 

result in a decrease in emissions given 

that inaccuracies in projections, in 

either case, may result in improper 

applicability conclusions? 

• Is there a more effective regulatory 

revision to require that decreases at Step 

1 are enforceable than what is being 

proposed in this action? Why would 

your proposed alternative be preferable 

to the revisions proposed by the EPA to 

the ‘‘significant emissions increase’’ 

definition? 

• Is this proposed requirement 

necessary for added assurance that 

decreases accounted for by a source 

under the project emissions accounting 

process actually occur and are 

maintained, or are the ‘‘reasonable 

possibility’’ requirements in the 

recordkeeping and reporting provisions, 

including the revisions to these 

provisions described in section VI., a 

sufficient means of assurance? 

• Finally, the EPA is taking comment 

on revising the regulations to expressly 

disallow project emissions accounting 

such that only emissions increases can 

be considered under the Step 1 

significant emissions increase 

determination. 

VI. ‘‘Reasonable Possibility’’ 

Recordkeeping and Reporting 

Regulations 

In this rulemaking, the EPA is 

proposing both clarifications to the 

existing ‘‘Reasonable Possibility’’ 

recordkeeping and reporting 

requirements and a strengthening of the 

regulations by requiring that all sources 

crediting a decrease at Step 1 maintain 

records and report information under 40 

CFR 52.21(r)(6). As with the 2007 

Reasonable Possibility (‘‘RP’’) rule, the 

EPA is again ‘‘analyz[ing] the trade-off 

between compliance improvement and 

the burdens of data collection and 

reporting’’ in this proposal.86

A. Clarification of Existing ‘‘Reasonable 

Possibility’’ Requirements 

The EPA is proposing regulatory 

language to clarify certain existing RP 

requirements to ensure appropriate and 

consistent application of those 

requirements by affected sources and 

reviewing authorities. This includes 

clarifying (1) the emissions units that 

should be included in the project actual 

emissions calculation; (2) the 

calculation to be included in the 

description of the applicability test used 

to determine that the project is not a 

major modification; (3) the emissions 

units to be included in the monitoring 

requirement at 40 CFR 52.21(r)(6)(iii); 

(4) the provisions that apply to projects 

that involve an electric utility steam 

generating; and (5) the emissions units 

that should be included in the 

‘‘projected actual emissions increase’’ 

used to determine whether there is a 

‘‘reasonable possibility’’ under 40 CFR 

52.21(r)(6)(vi). 

The provisions of 40 CFR 52.21(r)(6) 

apply with respect to any regulated NSR 

pollutant emitted from projects that 

involve one or more existing emissions 

units in circumstances where the owner 

or operator elects to use the method 

specified in 40 CFR 52.21(b)(41)(ii)(a) 

through (c) for calculating projected 

actual emissions from any existing 

emissions unit and there is a reasonable 

possibility that a project not classified 

as a major modification based on those 

projections may actually result in a 

significant emissions increase of such 

pollutant. The existing regulations 

define a project as ‘‘a physical change 

in, or change in the method of operation 

of, an existing major stationary source.’’ 

This leaves ambiguity with respect to 

the emissions units that should be 

included in the projected actual 

emissions calculation. To make this 

clear, consistent with the EPA’s original 

intent, the Agency is proposing 

revisions to 40 CFR 52.21(r)(6) and 

corresponding sections of the 

regulations to replace the terms ‘‘at 

existing emissions units’’ with ‘‘that 

involve one or more existing emissions 

units’’ and adding at the end of that 

paragraph, the phrase ‘‘from any 

existing emission unit.’’ 

The EPA is also proposing that the 

requirement under 40 CFR 

52.21(r)(6)(i)(c) that the pre-project 

record include ‘‘a description of the 

applicability test used to determine that 

the project is not a major modification 

for any regulated NSR pollutant’’ also 

include the PTE of an emissions unit, as 

applicable. It is important that the preproject NSR applicability record include 

all emissions units that could be 

affected by the project, including those 

units for which the actual-to-potential 

(ATP) test applies, i.e., any new 

emissions unit(s) and any existing 

emissions unit(s) for which the owner or 

operator elects to use PTE in lieu of 

projected actual emissions as provided 

by 40 CFR 52.21(b)(41)(ii)(d). To make 

this clear under 40 CFR 52.21(r)(6)(i)(c), 

the EPA is proposing to add ‘‘the 

potential to emit, as applicable’’ after 

‘‘the projected actual emissions’’ in that 

subparagraph. 

The EPA is proposing to clarify that 

the monitoring provisions in 40 CFR 

52.21(r)(6)(iii) apply to all the emissions 

units identified in 40 CFR 

52.21(r)(6)(i)(b) if the project increases 

the design capacity or potential to emit 

of any of those emissions units. The 

EPA is proposing to revise the language 

at the end of this paragraph from ‘‘if the 

project increases the design capacity or 

potential to emit that regulated NSR 

pollutant at such emissions unit’’ to ‘‘if 

the project increases the design capacity 

or potential to emit that regulated NSR 

pollutant at any existing emissions unit 

identified in 40 CFR 52.21(r)(6)(i)(b).’’ 

The EPA is proposing to clarify that 

the provisions of 40 CFR 52.21(r)(6)(iv) 

apply to projects that involve an electric 

utility steam generating unit, and that 

the provisions of 40 CFR 52.21(r)(6)(v) 

apply to projects that do not involve an 

electric utility steam generating unit. 

The EPA believes this clarification is 

appropriate to address the reporting 

requirements for projects that involve 

one or more electric utility steam 

generating units as well as other 

emissions units and to appropriately 


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87Petition for Reconsideration at 22 (citing 84 FR 

39251). 

88 85 FR at 74897. 

focus the requirements on the nature of 

the project rather than the emissions 

unit. To make this clarification under 40 

CFR 52.21(r)(6)(iv), the EPA is 

proposing to revise ‘‘if the emissions 

unit is an electric utility steam 

generating unit’’ to read ‘‘if the project 

involves an electric utility steam 

generating unit.’’ To make this 

clarification under 40 CFR 

52.21(r)(6)(v), the EPA is proposing to 

revise ‘‘if the unit is a unit other than 

an electric utility steam generating unit’’ 

to read ‘‘if the project does not involve 

an electric utility steam generating 

unit.’’ The EPA would like to make clear 

that the contents of the report required 

under 40 CFR 52.21(r)(6)(iv) for projects 

that involve an existing electric utility 

steam generating unit shall include the 

annual emissions from all units 

involved in the project as calculated 

pursuant to 40 CFR 52.21(r)(6)(iii). The 

EPA believes this clarification is 

appropriate to ensure that, for projects 

that involve one or more electric utility 

steam generating units as well as other 

emissions units, the required reports 

include the annual emissions from all 

emissions units involved in the project 

consistent with the requirement under 

40 CFR 52.21(r)(6)(v) for projects that do 

not involve an electric utility steam 

generating unit. To make this 

clarification under 40 CFR 

52.21(r)(6)(iv), the EPA is proposing to 

revise ‘‘setting out the unit’s annual 

emissions’’ to read ‘‘setting out the 

annual emissions from each affected 

emissions unit.’’ 

The ‘‘projected actual emissions 

increase’’ used to determine whether 

there is a ‘‘reasonable possibility’’ under 

40 CFR 52.21(r)(6)(vi) means the sum of 

the emissions changes of a regulated 

NSR pollutant for each emissions unit 

that could be affected by the project 

calculated using the appropriate 

procedure identified at 40 CFR 

52.21(a)(2)(iv) (i.e., the ATP test for any 

new emissions unit(s) and the ATPA 

applicability test for any existing 

emissions unit(s)). This includes all the 

emissions units identified in accordance 

with 40 CFR 52.21(r)(6)(i)(b) and is not 

limited to existing emissions units, or to 

those existing emissions units for which 

the owner or operator elects to use 

projected actual emissions. A full 

accounting of the project emissions 

increase is needed to determine whether 

and how the RP requirements apply. 

The EPA believes these clarifications 

to the RP recordkeeping and reporting 

requirements would help ensure that 

sources consistently determine the 

applicability of the reasonable 

possibility requirements in 40 CFR 

52.21(r)(6) and perform the 

recordkeeping, monitoring, and 

reporting needed to verify that projects 

determined not to constitute a major 

modification do not, after operation, 

result in a significant emissions 

increase. The proposed clarifications 

would thereby enhance accountability 

of sources relying on projected actual 

emission in their NSR applicability 

determinations and enforcement of the 

NSR provisions. 

In their petition for reconsideration, 

petitioners took issue with the EPA’s 

‘‘self-reporting and self-monitoring 

provisions’’ under 40 CFR 52.21(r)(6) 

because the revisions to the ‘‘reasonable 

possibility’’ provisions the EPA took to 

address the D.C. Circuit’s decision in 

New York v. EPA apply only to 

emissions increases. Petitioners stated 

that as a result of this, sources that 

account for an unenforceable emissions 

decrease at Step 1 such that they avoid 

a Step 2 netting analysis would not be 

subject to the ‘‘reasonable possibility’’ 

provisions. Petitioners add that that the 

lack of recordkeeping and reporting 

requirements in these instances prevent 

effective oversight and enforcement by 

the reviewing authority.87

In the response letter to the petition 

for reconsideration, the EPA noted that 

it responded to similar comments in the 

2020 PEA final rule. The EPA stated in 

that rule that 40 CFR 52.21(r)(6)(i)(b) 

requires a source to identify emissions 

units ‘‘whose emissions of a regulated 

NSR pollutant could be affected by the 

project.’’ The EPA stated that the use of 

‘‘affected’’ as opposed to ‘‘increased’’ 

supports the EPA’s view that the 

‘‘reasonable possibility’’ test can be used 

to track both the increases and decreases 

from a project. The EPA added that the 

information required for collection 

under 40 CFR 52.21(r)(6)(i)(c) similarly 

can apply to both increases and 

decreases from the project. As a result, 

in that action, the EPA disagreed that 

the ‘‘reasonable possibility’’ provisions 

were inadequate to account for projects 

that included emissions decreases.88

Although EPA continues to support 

this reading of the existing regulations, 

to better address the concern expressed 

by petitioners that the existing RP 

provisions ‘‘do not provide an effective 

mechanism to ensure that unenforceable 

emission decreases . . . will . . . be 

qualitatively equivalent to the increases 

they purportedly offset,’’ the EPA is 

proposing to revise the text of the NSR 

applicability regulations at 40 CFR 

52.21(a)(2)(iv)(b) to more clearly state 

that the major modification applicability 

calculations must include all of the 

emissions units that could be affected 

by the project, consistent with 40 CFR 

52.21(r)(6)(i)(b). Affected emissions 

units may include new, modified, and 

non-modified affected emissions units 

involved in the project. Non-modified 

affected emissions units are existing 

emissions units that will not undergo a 

physical change or change in the 

method of operation but that could 

realize a change in utilization as a result 

of the project, including increases 

resulting from removal of a process 

bottleneck (what we often call ‘‘debottlenecking’’). The existing language 

under 40 CFR 52.21(a)(2)(iv)(b) states 

that ‘‘[t]he procedure for calculating 

. . . whether a significant emissions 

increase . . . will occur depends upon 

the type of emissions units being 

modified,’’ which is unclear with 

respect to the need to also include nonmodified existing emissions units that 

could be affected by the project. The 

proposed clarification to the regulations 

will provide consistency between the 

applicability and RP regulations and 

help ensure that all emissions units that 

could be affected by a project and all 

corresponding emissions increases and 

decreases are included in the 

applicability calculations and postproject monitoring, recordkeeping, and 

reporting. 

Finally, the EPA proposes to clarify 

the meaning of the term ‘‘differ,’’ as 

used in the reporting requirements for 

projects that do not involve an electric 

utility steam generating unit under 40 

CFR 52.21(r)(6)(v). This provision 

provides that a reporting obligation is 

triggered, in part, when the annual 

emissions, in tpy, from a project ‘‘differ 

from the preconstruction projection as 

documented and maintained pursuant 

to paragraph (r)(6)(i)(c) of this section.’’ 

First, the EPA does not intend for a 

difference between post-project 

emissions and pre-project projection by 

itself to trigger reporting. Rather, the 

EPA intends for reporting to be triggered 

under 40 CFR 52.21(r)(6)(v) when postproject emissions differ from the 

preconstruction project in a way that 

indicates that the project did in fact 

result in a significant emissions 

increase. Second, the term ‘‘differ’’ is 

not synonymous with ‘‘exceed,’’ and 

that distinction is important in 

determining when reporting is required 

under 40 CFR 52.21(r)(6)(v). The EPA 

intends to require reporting when 

emissions exceed the baseline actual 

emissions by a significant amount and 

exceed the preconstruction projection, 

and when actual emissions monitored 

and recorded after a project in 


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89Petition for Reconsideration at 9–10 (noting 

that ‘‘in their comments on the proposal, Petitioners 

argued that the proposed project emissions 

accounting approach contravened the Clean Air 

Act’s requirement that NSR apply to any change 

that ‘increases the amount of any pollutant emitted’ 

by a source because, inter alia, it would allow a 

source to avoid NSR based on offsetting emission 

decreases that are not contemporaneous with the 

change under consideration’’). 

90 40 CFR 52.21(r)(6)(ii), (iv), and (v). 

91 40 CFR 52.21(r)(6)(ii). 

accordance 40 CFR 52.21(r)(6)(iii) that 

do not exceed the preconstruction 

projection may nevertheless differ in a 

way that materially impacts the validity 

of the pre-project NSR applicability 

conclusion. For example, post-project 

actual emissions data may indicate that 

the portion of emissions excluded 

pursuant to 40 CFR 52.21(b)(41)(ii)(c) 

was overestimated for one or more 

existing emissions units. Thus, while 

the post-project emissions calculated for 

the project may not have exceeded the 

pre-project projection, there may be 

evidence that the emissions increase 

from the project would have been 

significant had certain emissions not 

been erroneously excluded. If such 

evidence exists, and if the emissions 

from all project-affected emissions units 

exceed the baseline actual emissions by 

a significant amount, a report must be 

submitted in accordance with 40 CFR 

52.21(r)(6)(v). The EPA requests 

comment on whether we should add the 

word ‘‘materially’’ in front of the word 

‘‘differ’’ or amend this provision in 

another way to achieve the result 

described above. 

B. Proposed New ‘‘Reasonable 

Possibility’’ Requirements 

In addition to the clarifications 

described in the preceding section, the 

EPA is also proposing additional 

requirements to the ‘‘reasonable 

possibility’’ recordkeeping and 

reporting provisions. These include (1) 

proposing to add a new criteria to the 

RP provisions such that a source is 

subject to the RP requirements 

whenever a decrease is accounted for in 

the Step 1 significant emissions increase 

determination; (2) removing the 

distinction between EUSGUs and all 

other sources with respect to the 

submission of pre-project records; and 

(3) adding records that must be 

submitted to the reviewing authority 

when the source is subject to RP for a 

particular project. 

The EPA is proposing to revise the RP 

regulations to require that any source 

accounting for a decrease at Step 1 is 

also subject to the reasonable possibility 

recordkeeping provisions. This 

proposed revision to the RP regulations 

is intended to balance compliance 

assurance with recordkeeping and 

reporting burdens. The express 

inclusion of decreases at Step 1 in the 

NSR applicability process in project 

emission accounting warrants 

additional recordkeeping and reporting 

to ensure that decreases that a source 

accounts for are appropriately 

considered as part of the project being 

evaluated and to provide a means to 

determine whether such decrease(s) 

actually occur. Stakeholders have raised 

concern that sources can use project 

emissions accounting to evade 

permitting requirements that they 

would otherwise be subject to and that 

there would be no way for permitting 

authorities to identify that the source 

should have been subject to NSR 

permitting. For example, the petition for 

reconsideration expressed concern that 

under project emissions accounting, 

sources may improperly account for an 

unrelated decrease at Step 1 and thereby 

improperly find that a permit is not 

required.89 If, in aggregate, the 

emissions increase determined by the 

source is less than the RP threshold, it 

may be the case that the source is not 

subject to any recordkeeping and 

reporting requirements under the 

existing regulatory requirements. This 

means that the reviewing authority may 

not be able to verify that activities were 

properly aggregated and that decreases 

accounted for in the NSR applicability 

process actually occur. 

Therefore, in this action, the EPA is 

proposing to require that projects that 

involve a calculated emissions decrease 

of a regulated NSR pollutant from one 

or more affected emissions units are 

subject to the RP provisions, including 

40 CFR 52.21(r)(6)(i) through (v), as 

applicable, for that pollutant regardless 

of the overall estimated project 

emissions increase. The EPA is 

proposing this revision because the 

express inclusion of decreases under 

project emissions accounting warrants 

further accountability to ensure that 

those decreases are appropriately 

considered part of the project (i.e., 

physical change or change in the 

method of operation at a source) and to 

provide a means to determine whether 

the decreases being accounted for 

actually occur. To implement this new 

requirement, the EPA is proposing to 

revise the RP regulations to include 

another category of projects that would 

have a ‘‘reasonable possibility’’ of 

resulting in a significant emissions 

increase, namely any project that that 

includes an emissions decrease in PEA 

at Step 1. The EPA is proposing to do 

so by adding the following as a trigger 

to the reasonable possibility in 

recordkeeping and reporting 

requirements: ‘‘The owner or operator 

accounts for a decrease in emissions 

from one or more emissions unit(s) in 

determining that the project is not a 

major modification for a regulated NSR 

pollutant regardless of the projected 

actual emissions increase.’’ 

Under the existing RP regulations, 

sources that trigger the ‘‘reasonable 

possibility’’ criteria under 40 CFR 

52.21(r)(6)(vi)(a) for projects that 

involve EUSGUs are required to submit 

pre-project records and post-project 

monitoring reports while sources that 

trigger the same criteria for projects that 

do not involve EUSGUs are not required 

to submit pre-project records and are 

only required to submit post-project 

reports when certain criteria are met.90

The EPA believes that restricting the 

pre-project reporting requirements to 

EUSGUs may not be warranted. There is 

currently no requirement in the Federal 

regulations that source owners or 

operators of projects involving nonEUSGU sources subject to RP notify 

reviewing authorities that they are 

maintain records on-site as required by 

RP. The EPA is revising the pre-project 

requirements to align the requirements 

for all project types. This revision is 

intended to provide more transparency 

for projects that may not have otherwise 

been reviewed under the current 

regulations. 

To address these concerns, the EPA is 

proposing language to remove the 

distinction between EUSGUs and nonEUSGUs in the submission of preproject records required under 40 CFR 

52.21(r)(6)(i). The EPA is proposing to 

do so by specifying that all sources that 

trigger the RP criterion under 40 CFR 

52.21(r)(6)(vi)(a) submit to the 

reviewing authority the records required 

to be generated in accordance with 40 

CFR 52.21(r)(6)(i). To remove the 

differential treatment of EUSGUs and all 

other sources with respect to pre-project 

reporting requirements under the RP 

regulations, the EPA is proposing to 

remove the language ‘‘if the emissions 

unit is an existing electric utility steam 

generating unit’’ where that language is 

used in the reasonable possibility 

provisions for submission of pre-project 

records.91

The EPA is proposing this revision to 

provide increased transparency and 

opportunity for review of pre-project 

applicability analyses for projects that 

do not involve EUSGUs, and to ensure 

that required minor NSR permit 

applications contain the requisite detail 

necessary to confirm compliance with 

the definition of project outlined in 

section III. of this action. The EPA does 


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92New Jersey v. EPA, 989 F.3d 1038 (D.C. Cir. 

2021) (citing 72 FR at 72609–11). 

93 Id. at 1050. 

94 Id. at 1051. 

not expect this requirement to add 

significant regulatory burden. Since 

non-EUSGUs subject to the ‘‘reasonable 

possibility’’ recordkeeping and 

reporting provisions under existing 

regulations are required to maintain preproject records, the only additional 

requirement for non-EUSGUs subject to 

RP would be submitting these records to 

the reviewing authority. In many cases, 

this submission of pre-project records 

would generally occur anyway as part of 

a minor NSR permitting process. Under 

circumstances that require a minor NSR 

permit application or other transaction 

with the reviewing authority, the preproject records required by the RP 

provision are normally included in the 

submittal. The proposed rule is 

intended to avoid any gaps where such 

information is not otherwise submitted 

to the reviewing authority. 

When considered with the proposed 

expansion of ‘‘reasonable possibility’’ to 

include instances where a source 

considers one or more emissions 

decreases at Step 1 of the NSR 

applicability process, the proposed 

additional pre-project reporting 

requirement for non-EUSGU projects 

would create more transparency and 

accountability when such emissions 

decreases are considered in the project 

emissions accounting process. If these 

requirements are finalized as proposed, 

they would enable reviewing authorities 

to identify potentially improperly 

accounting for emissions decreases to 

avoid triggering the ‘‘reasonable 

possibility’’ criteria that a source would 

otherwise have been subject to. 

Additionally, the EPA proposes that 

sources be required to submit preproject records to the reviewing 

authority for all projects that trigger the 

RP criteria, including projects that do 

not involve EUSGUs. Under the existing 

RP regulations, sources are only 

required to maintain the required preproject records on site and are not 

required to notify the reviewing 

authority that these records are being 

maintained because RP has been 

triggered. If the revisions proposed in 

this action are finalized, this gap in 

reporting will be filled. This is because 

sources that consider a decrease at Step 

1 would trigger RP and would be 

required to submit records specifying 

the decreases to the reviewing authority. 

In the alternative of requiring that all 

records be submitted to the permitting 

authority, the EPA is taking comment on 

requiring that, for projects that do not 

involve EUSGU(s), owner or operators 

need only inform the permitting 

authority that they are maintaining 

records on site as required by the 

‘‘reasonable possibility’’ provisions. 

The EPA is also proposing to specify 

that the description of a project in these 

records include ‘‘the name of the 

project, the project’s intended 

objective(s), each physical change and/ 

or change in the method of operation 

associated with the project objective(s), 

and estimated timeline for the project, 

including an estimation of when the 

project would begin actual construction 

and begin normal operation.’’ When 

combined with the proposed definition 

of project, these proposed revisions to 

the RP regulations will foster greater 

accountability for applicability 

conclusions, including whether the 

source owner/operator is required to 

maintain ‘‘reasonable possibility’’ 

records. 

The EPA is seeking information on 

the potential implications of these 

proposed revisions to the RP 

regulations, including benefits to the 

enforceability of major NSR permitting 

requirements and burden on sources 

and/or the reviewing authorities that 

may result from the proposed revisions. 

The EPA is requesting substantiation of 

any facility expansion projects (or other 

projects affecting emissions) that did not 

go forward solely because the source did 

not want to maintain or submit RP 

records. The EPA is aware that 

expanding the ‘‘reasonable possibility’’ 

recordkeeping and reporting 

requirement to all projects that include 

a decrease in their Step 1 applicability 

calculations may expand the number of 

sources subject to recordkeeping, 

monitoring, and reporting provisions. 

The EPA believes that in many cases 

these sources and the emissions units 

involved in a project subject to RP 

requirements will also be subject to 

other CAA recordkeeping, monitoring, 

and reporting requirements, including 

those associated with NSR or title V 

permits, other SIP provisions, and 

applicable standards such as new source 

performance standards (NSPS). Thus, 

much of the information required to 

meet the expanded RP requirements 

should already be available. The EPA 

would like information on the number 

and types of sources and projects that 

will be subject to the additional 

recordkeeping and reporting 

requirements if this proposed revision is 

finalized and to what extent existing 

requirements and available information 

can be used to meet these new 

requirements with little extra burden. 

Finally, the EPA would also like 

information on potential administrative 

costs and/or benefits of these proposed 

revisions to the recordkeeping and 

reporting requirements to reviewing 

authorities. 

C. Additional Considerations for 

Proposed Reasonable Possibility 

Revisions 

The proposed revisions to the RP 

regulations discussed previously 

comport with the court’s decision in 

New Jersey v. EPA in that they balance 

‘‘ease of enforcement with avoidance of 

requirements that would be unnecessary 

or unduly burdensome on reviewing 

authorities or the regulated 

community.’’ 92 However, the EPA is 

proposing regulations today that shift 

that balancing based on developments 

since the promulgation of the RP 

regulations considered in that case. 

In that decision, the court did not 

respond to petitioner’s concerns about 

the sufficiency of RP in light of the 

project emissions accounting rule, 

stating that ‘‘enforcement problems 

stemming from EPA’s actions following 

the Rule’s promulgation are beyond the 

current record for judicial review.’’ 93

The EPA is now proposing, revisions to 

RP to account for potential increased 

risk of improper avoidance of NSR 

requirements due to the express 

inclusion of decreases in Step 1 under 

the 2020 PEA rule. 

In New Jersey v. EPA, the petitioner 

also challenged ‘‘EPA’s explanation that 

enforcement authorities may rely on 

other records—such as Title V records, 

minor NSR records, state and national 

emissions inventory records, and 

business records—to evaluate 

preconstruction NSR compliance when 

the Rule’s recordkeeping and reporting 

requirements are not triggered.’’ The 

petitioner argued ‘‘that such records 

lack the type of project-specific, 

preconstruction information needed to 

evaluate NSR compliance’’ and ‘‘that 

EPA failed to explain how enforcement 

authorities may draw on these records 

collectively to trace emissions increases 

to specific modifications.’’ 94 The D.C. 

Circuit did not find these arguments 

persuasive on the grounds the 

petitioners ‘‘cite[ ] no authority to 

support the[ir] proposition.’’ 

However, it has been several years 

since the EPA completed the 

rulemaking that was challenged in the 

New Jersey case, and the record for that 

rulemaking is now several years old. 

The EPA has since received feedback 

regarding the sparsity of information in 

minor NSR permit applications. For 

example, the EPA has received 

comments from state permitting 

authorities and environmental groups 

that oftentimes minor NSR permit 


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95See, e.g., Sierra Club, et al., Response to 

Request for Comments on Proposed Rule: 

Prevention of Significant Deterioration (PSD) and 

Nonattainment New Source Review (NNSR): Project 

Emissions Accounting, 84 FR 39244 (August 9, 

2019) at 21 (commenting that PEA ‘‘would allow 

sources to avoid any obligation to ‘retain the data 

underlying their projections, let alone send that 

information to permitting authorities,’ so long as the 

source believes that its unenforceable (and 

potentially unidentified and undocumented) 

emission reductions will not trigger an increase in 

emissions.’’). 

96CAA section 182(c)(6); CAA section 182(e)(2). 

97While CAA section 182(c)(6) refers only to VOC 

emissions, CAA section 182(f) extends to NOX

emissions all requirements related to VOC 

emissions. 98CAA section 182(c)(6). 

99CAA section 182(e)(2). 

100Where the EPA has only delegated authority 

to implement a date-specific version of section CAA 

52.21, the delegation agreement would need to be 

updated to incorporate the revisions in this rule. 

records do not contain information on 

how the applicability analysis was 

conducted, thereby impeding 

verification of a source’s determination 

that a major NSR permit is not required 

under a given circumstance.95 The EPA 

is thus proposing revisions to address 

these concerns. 

VII. Revisions To Clarify Statutory 

Limitations on Netting in 

Nonattainment NSR 

The EPA is proposing revisions to the 

NSR nonattainment provisions to make 

the regulations consistent with CAA 

requirements, which limit netting in 

certain ozone non-attainment areas. The 

proposed revisions are applicable to 

Serious, Severe and Extreme classified 

ozone nonattainment areas and establish 

that for these areas, emissions increases 

over any period of 5 consecutive years 

should be aggregated when determining 

whether there is a significant net 

emissions increase, and in Extreme 

ozone nonattainment areas, project 

emissions accounting is not permissible 

under the CAA.96 This includes 

revisions to the language in 40 CFR 

51.165 and appendix S to part 51 to 

reflect that sources locating in an ozone 

nonattainment area that is classified as 

Serious or Severe for ozone, must 

aggregate all net emissions increases 

that have occurred within the previous 

5 consecutive calendar year period. The 

proposed revisions will also establish 

that netting is not available for sources 

emitting ozone precursors and locating 

in ozone nonattainment areas that are 

classified as Extreme. 

The EPA noted in the 2020 PEA rule 

that project emissions accounting would 

not apply to ‘‘certain modification 

provisions under Title I, Subpart D of 

the CAA and the EPA nonattainment 

NSR regulations that apply to certain 

nonattainment area classifications. For 

example, CAA section 182(e)(2) and 40 

CFR part 51, appendix S 11.A.5.(v).’’ 

The EPA did not in that action, 

however, elaborate and clarify that 

project emissions accounting would not 

be available in certain nonattainment 

areas. This section addresses the 

application of netting and PEA in those 

situations. 

The provisions of section 182(c)(6) of 

the CAA apply to ozone nonattainment 

areas classified Serious or higher. The 

provisions state that any emission 

increases of ozone precursor emissions 

(VOC and NOX) 97 resulting from a 

modification shall not be considered de 

minimis for the purposes of determining 

NNSR applicability ‘‘unless the 

increases in net emissions. . .from such 

source does not exceed 25 tons when 

aggregated with all other net increases 

in emissions from the source over any 

period of 5 consecutive calendar years 

which includes the calendar year in 

which such increase occurred.’’ Thus, 

sources locating in an area classified 

Serious or Severe for ozone cannot 

consider an emission increase to be de 

minimis (i.e., not significant) if it 

exceeds a 25 ton per year threshold of 

an ozone precursor when emissions 

from the project are aggregated with 

other projects that result in emissions 

increases over a period of 5 consecutive 

calendar years.98 For sources locating in 

areas that are classified as Extreme for 

ozone, section 182(e)(2) of the CAA 

specifies that any change at a major 

stationary source which results in any 

increase in emissions from any discrete 

operation, unit, or other pollutant 

emitting activity at the source must be 

considered a major modification for 

NSR applicability purposes. In addition, 

in an Extreme area, the source has the 

option of providing offsets from other 

discrete operations, units, or activities 

within the source at an internal offset 

ratio of at least 1.3 to 1, rather than the 

required 1.5 to 1 offset ratio.99 The EPA 

is proposing language in the regulations 

to implement this CAA language 

applicable to sources that emit ozone 

precursors that are locating in an area 

that is classified as Serious, Severe or 

Extreme for ozone. 

VIII. Implementation of These Proposed 

Revisions for Delegated and SIPApproved Programs 

The PSD program requirements in 40 

CFR 52.21 are implemented by the EPA 

or reviewing authorities that have been 

delegated Federal authority from the 

EPA to issue PSD permits on behalf of 

the EPA (via a delegation agreement 

with an EPA Regional office). Thus, if 

these proposed regulatory changes are 

finalized, any revisions to this federal 

PSD regulation will automatically apply 

to the EPA and all permitting authorities 

that implement a PSD program pursuant 

to a delegation agreement that does not 

reference § 52.21 as of a specific date.100

For state and local agencies that 

implement the NSR program through 

EPA-approved SIPs, the EPA’s 

regulations for SIP-approved programs 

in 40 CFR 51.165 and 51.166 include 

applicability procedures that are 

analogous to the applicability 

procedures at 40 CFR 52.21(a)(2)(iv) that 

have been cited in this preamble. 

If finalized, these regulations would 

modify the content of the minimum 

program elements of NSR. 

Consequently, if the EPA were to 

finalize the revisions being proposed in 

this rulemaking, reviewing authorities 

would need to revise their regulations 

and submit SIP revisions to adopt those 

revisions. Upon the effective date of any 

final revisions, EPA’s implementing 

regulations at 40 CFR 51.166(a)(6) 

provide permitting authorities with up 

to 3 years to submit state 

implementation plan revisions 

reflecting any final EPA revisions to 

permit program regulations. If a 

reviewing authority’s SIP-approved 

regulations already require that sources 

submit information consistent with the 

information required in the revisions to 

the reasonable possibility recordkeeping 

and reporting requirements described in 

section VI. of this action, those 

requirements may be considered by the 

EPA to be as stringent as that required 

by any final EPA regulatory revisions. 

Reviewing authorities whose SIPapproved regulations already require 

submission of regulations consistent 

with the proposed revisions in this 

action may submit a demonstration that 

their requirements are as stringent as 

those in the final action. 

IX. Costs, Benefits, and Other Impacts 

of the Proposed Rule 

The EPA is proposing to codify a 

definition of project and is proposing 

revisions to the monitoring, 

recordkeeping and reporting provisions 

under the major NSR program 

regulations to improve compliance with, 

and enforcement of, the major NSR 

applicability regulations. The benefits 

and costs associated with the proposed 

revisions to the NSR regulations are 

likely to vary greatly depending on the 

source category, number and location of 

facilities, and the pollutants and 

potential controls involved in any future 

contemplated projects. The EPA expects 


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101 85 FR at 74895. 

102Response to Comments Document on 

Proposed Rule: ‘‘Prevention of Significant 

Deterioration (PSD) and Nonattainment New Source 

Review (NNSR): Project Emissions Accounting’’— 

84 FR 39244, August 9, 2019, at 58 (October 2020). 103 83 FR 57324 (November 15, 2018). 

that the overall impacts of the proposed 

changes to the major NSR program 

applicability regulations will provide 

clarity and will also improve practicable 

enforceability and public transparency 

of the NSR program applicability 

requirements. However, there are 

numerous challenges to quantifying 

potential cost and emissions impacts of 

the proposal. The EPA lacks data on the 

NSR permitting process since the NSR 

program is largely implemented by state 

and local reviewing authorities. Because 

NSR is a pre-construction program, the 

EPA also faces the absence of 

information on projects that would have 

been subject to NSR permitting 

requirements if the revisions proposed 

in this action are finalized as proposed. 

This is to say that the EPA does not 

have information, with the exception of 

anecdotal evidence, on what projects 

would have been undertaken but for the 

codification of a definition of project, 

the requirements that decreases be made 

enforceable at Step 1 of the two-step 

NSR applicability requirements, or 

additional recordkeeping and reporting 

requirements. Because the EPA has no 

information on what forthcoming 

projects are planned and what impact 

the proposed revisions to the NSR 

regulations would have on these 

projects, the EPA also does not have 

specific information on what emissions 

impacts these projects would have had. 

For example, major source permit 

applications are not submitted to the 

EPA, but to state and local reviewing 

authorities. There is currently no 

centralized database for NSR permit 

applications due primarily to potential 

federalism concerns. Minor source 

permitting is performed at the state and 

local levels (with the exception of 

Indian country), and there is significant 

variation in how state and local 

authorities design and implement minor 

source permit programs. Additionally, 

there are currently instances where a 

source may trigger the reasonable 

possibility recordkeeping and reporting 

requirements but not any NSR 

permitting requirements. If the source is 

not an EUSGU, then that source (under 

the EPA’s Federal regulations) does not 

need to notify the reviewing authority or 

the public that these requirements were 

triggered. 

In a separate effort, the EPA has been 

scoping the development of an 

economic model appropriate to evaluate 

NSR applicability. Assuming the 

availability of appropriate permitting 

data as described earlier, the model 

could potentially be used to evaluate 

how proposed changes to the NSR 

regulations might impact permitting 

costs to industry and agencies, 

economic activities, and emissions. 

In absence of a quantitative analysis 

for this action, the following discussion 

presents a qualitative assessment of the 

potential benefits and costs of the major 

clarifications and revisions included in 

this proposal. 

A. Proposed Definition of ‘‘Project’’ 

The EPA expects the proposed 

revisions to the regulatory definition of 

‘‘project’’ will not impose additional 

direct regulatory costs on reviewing 

authorities and regulated entities, but 

will benefit permitting authorities and 

the public by systemizing application of 

the NSR applicability process to focus 

on a ‘‘project’’ under a consistently 

interpreted definition. Since this would 

codify pre-existing EPA guidance—the 

2018 Project Aggregation Final Action 

that affirmed a prior 2009 

interpretation—the EPA expects it will 

not impose additional direct regulatory 

costs. In the 2020 PEA rulemaking, the 

EPA stated that ‘‘it is appropriate to 

apply its ‘project aggregation’ 

interpretation and policy, set forth in 

the 2018 final action that completed 

reconsideration of a 2009 action on this 

topic to Step 1 of the NSR major 

modification applicability test for 

projects that involve both increases and 

decreases in emissions.’’ 101 This was 

reiterated in the Response to Comments 

document on the PEA rule, which stated 

that ‘‘the EPA is affirming that the 

criteria in the November 2018 final 

action on project aggregation apply 

universally to defining a project for 

purposes of major NSR, i.e., both in the 

context of under- and over-aggregation 

of activities into a project and the 

associated potential circumvention of 

NSR.’’ 102 While the EPA repeatedly 

pointed to the 2018 Project Aggregation 

Final Action as the interpretation 

sources and permitting authorities 

should be implementing, it did not 

codify this interpretation. Therefore, the 

proposed codification of a definition for 

project is consistent with how the EPA 

presumed ‘‘project’’ would be defined in 

the 2020 PEA rule and should impose 

no additional obligations on regulated 

entities and permitting authorities. 

Consistent with the EPA’s statements 

in the 2018 Project Aggregation Final 

Action, we anticipate the EPA’s efforts 

to clarify ‘‘project’’ through this 

rulemaking ‘‘will streamline NSR 

permitting by reducing the time needed 

to assess whether nominally-separate 

physical and operational changes 

should be aggregated for NSR 

applicability purposes.’’ 103 As 

explained in section III. of this 

preamble, this definition will provide 

guardrails that will ensure that 

decreases that a source accounts for are 

actually part of the project being 

considered in the NSR applicability 

process. 

B. Enforceability of Emissions Decreases 

In this action, the EPA is proposing to 

require that decreases accounted for in 

Step 1 of the NSR applicability process 

be made enforceable. In this action the 

EPA is requesting information on the 

costs to reviewing authorities and to 

sources associated with proposing that 

decreases be made enforceable. As 

explained in section V. of this action, 

the EPA is proposing to make decreases 

enforceable due to concerns that PEA 

will allow sources to include decreases 

in the project-related NSR applicability 

analysis without any assurance that 

those decreases will actually occur. 

C. Clarifications and Revisions to the 

‘‘Reasonable Possibility’’ (RP) in 

Recordkeeping and Reporting Provisions 

The EPA is proposing to clarify 

certain existing RP requirements as 

follows to ensure appropriate and 

consistent application of those 

requirements by affected sources and 

reviewing authorities. The EPA is 

proposing to clarify that the provisions 

of 40 CFR 52.21(r)(6) apply with respect 

to any regulated NSR pollutant emitted 

from projects that involve one or more 

existing emissions units in 

circumstances where there is a 

reasonable possibility that a project that 

is not a part of a major modification may 

result in a significant emissions increase 

of such pollutant, and the owner or 

operator elects to use the ATPA method 

for calculating projected actual 

emissions from any existing emissions 

unit. As with the codification of a 

definition of project, this clarification 

will allow for more consistent 

application of the reasonable possibility 

and recordkeeping provisions across the 

nation as those regulations were 

intended to apply. 

Additionally, the EPA is expanding 

the applicability of the RP regulations 

due to PEA. The EPA believes that the 

inclusion of decreases at Step 1 in the 

NSR applicability process (i.e., project 

emission accounting) may warrant 

additional recordkeeping and reporting 

to ensure that decreases that a source 

accounts for are appropriately 


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104For projects that involve one or more EUSGUs, 

owners or operators are required to submit records 

under the RP regulations, but for all other projects, 

owners or operators must only maintain records onsite and are not currently required to notify the 

reviewing authority that they are maintaining RP 

records on-site. 

105 40 CFR 52.21(r)(6)(vi). 

considered as part of the project being 

evaluated and that such decrease(s) 

actually occur following the project. In 

order to determine whether they are 

subject to permitting requirements, all 

sources are required to undertake the 

calculation that is part of the NSR 

applicability process. Under the current 

regulations, sources that conduct the 

applicability analysis are not required to 

submit any information indicating that 

they are not subject to the NSR 

permitting requirements nor are they 

required to notify the reviewing 

authority that they are subject to the RP 

recordkeeping and reporting 

requirements.104 This proposal would 

not result in a substantial increase in 

costs because it would only require that 

sources submit records they are already 

required to produce and, in some cases, 

maintain on-site. 

Following promulgation of the PEA 

rule, sources accounting for a decrease 

associated with a project in Step 1 in the 

NSR applicability process may evade all 

recordkeeping requirements if the sum 

of that decrease and any increase from 

the same project is under 50 percent of 

the SER.105 Therefore, if a source 

impermissibly undertakes a project that 

requires a permit and where that source 

claims a decrease in emissions 

associated with the project such that the 

emissions projected for the project is 

under 50 percent of the SER, there is no 

means of verifying whether that project 

was appropriately defined. There is, in 

fact, no means for the reviewing 

authority or the public to know that 

such project that would otherwise have 

required a permit but for emissions 

decrease purportedly associated with 

the project, is occurring. There is 

therefore no way under the currently 

regulatory scheme which allows for 

PEA, for the public or for permitting 

authorities to ensure that decreases that 

were used by a source to forgo 

permitting requirements are actually 

occurring. The EPA believes these 

shields are an impediment to practical 

enforceability of the applicability 

process and that it may be warranted to 

require greater accountability for 

projects that account for project-related 

decreases in their ‘‘significant emissions 

increase’’ calculation. The EPA is 

therefore proposing to require that these 

sources submit any required pre-project 

records to the reviewing authority as 

required by the NSR regulations. 

D. Revisions to Nonattainment

Applicability Provisions

The proposed revisions to the 

nonattainment provisions applicable to 

Serious, Severe and Extreme classified 

ozone nonattainment areas do not 

impose new costs on sources, reviewing 

authorities, or the public. Rather, they 

merely establish in regulations 

requirements that sources are already 

required to adhere to in the CAA. This 

includes that for these areas, sourcewide netting is not permissible, and in 

extreme ozone nonattainment areas 

project emissions accounting is not 

permissible under the CAA. 

Accordingly, in this action, the EPA is 

not proposing new requirements but is 

only proposing revisions to the 

regulations in 40 CFR 51.165 and 

appendix S to part 51 to reflect that 

sources locating in an area that is 

classified as Serious or Severe for ozone, 

must aggregate all net emissions 

increases that have occurred within the 

previous 5 consecutive calendar year 

period. These revisions mirror CAA 

language and do not reflect new 

requirements imposed upon sources or 

reviewing authorities. Consequently, 

these revisions will not change any preexisting requirements for sources 

locating in ozone nonattainment areas 

or reviewing authorities. 

X. Statutory and Executive Order

Reviews

Additional information about these 

statutes and Executive Orders (‘‘E.O.’’) 

can be found at http://www2.epa.gov/ 

laws-regulations/laws-and-executiveorders. 

A. Executive Order 12866: Regulatory

Planning and Review and Executive

Order 14904: Modernizing Regulatory

Review

This action is not a significant 

regulatory action as defined in 

Executive Order 12866, as amended by 

Executive Order 14094, and was, 

therefore, not subject to a requirement 

for Executive Order 12866 review. 

B. Paperwork Reduction Act (PRA)

This action does not impose any new

information collection burden under the 

PRA. OMB has previously approved the 

information collection activities 

contained in the existing regulations 

and has assigned OMB control numbers 

2060–0003 for the PSD and NNSR 

permit programs. The burden associated 

with obtaining an NSR permit for a 

major stationary source undergoing a 

major modification is already accounted 

for under the approved information 

collection requests. 

C. Regulatory Flexibility Act (RFA)

I certify that this action will not have

a significant economic impact on a 

substantial number of small entities 

under the RFA. This action will not 

impose any requirements on small 

entities. This proposed rule will 

strengthen the reasonable possibility in 

current recordkeeping and reporting 

provisions by requiring that any source 

wishing to account for a decrease in the 

significant emissions increase 

determination in the NSR applicability 

process be subject to those 

recordkeeping and reporting provisions. 

This proposed rule, if finalized, may 

therefore increase the recordkeeping 

and reporting burdens of sources that 

may have otherwise not been subject to 

these requirements. The EPA is 

soliciting feedback on the number of 

sources that may be subject to 

recordkeeping and reporting 

requirements because of this proposed 

revision and is also soliciting 

information on the cost of compliance to 

these sources. The EPA does not 

anticipate, however, that the economic 

impact of this revision will be 

significant since most sources that 

undertake an emissions-decreasing 

activity would likely have been subject 

to recordkeeping and reporting 

requirements in the absence of the 

proposed revision. Consequently, a 

substantial number of small entities are 

unlikely to be impacted should this 

proposed revision be finalized. 

Furthermore, with respect to proposed 

revisions to reporting requirements, the 

EPA does not anticipate that this would 

result in a significant economic impact 

on a substantial number of small entities 

because under existing regulations, all 

sources are required to maintain 

records. The EPA does not believe that 

the additional requirement of 

submitting these records, which are 

already required to be produced, will 

result in a significant economic impact 

on a substantial number of small 

entities. 

D. Unfunded Mandates Reform Act

(UMRA)

This proposed action does not contain 

an unfunded mandate of $100 million or 

more as described in UMRA, 2 U.S.C. 

1531–1538, and does not significantly or 

uniquely affect small governments. This 

action imposes no enforceable duty on 

any state, local or tribal governments or 

the private sector. Nonetheless, if this 

rule is finalized as proposed, it is 

possible that some state and local air 


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106 In an informal survey, the EPA identified 34 

out of 79 permit authorities that allow the use of 

PEA in their PSD programs. Of these, 8 are 

delegated authorities and in three, EPA is the 

reviewing authority. Additionally, seven 

incorporate the federal rules by reference, three 

have a rulemaking underway to adopt the federal 

rule, 16 interpret their pre-2020 PEA rule 

regulations to allow for PEA by adopting the 

interpretation in the 2018 Memo or another 

equivalent interpretation, and two have revised 

their regulations to implement PEA and submitted 

a SIP to the EPA for approval. For 13 of these 

authorities, it is unclear whether they interpret their 

regulations to allow for PEA. 

107E.g., Washington has adopted regulations 

consistent with those proposed in this action in 

WAC 173–400–720(4)(b)(iii)(D); N.J. Stat. section 

26:2C–9.2(i) provides that ‘‘the department may 

require the reporting and evaluation of emissions 

information for any air contaminant.’’ 

agencies will need to submit a one-time 

revision to their SIP. 

E. Executive Order 13132: Federalism 

This action does not have federalism 

implications. It will not have substantial 

direct effects on the states, on the 

relationship between the national 

government and the states, or on the 

distribution of power and 

responsibilities among the various 

levels of government. 

F. Executive Order 13175: Consultation 

and Coordination With Indian Tribal 

Governments 

This action does not have tribal 

implications as specified in Executive 

Order 13175 in that this action would 

neither impose substantial direct 

compliance costs on federally 

recognized tribal governments, nor 

preempt tribal law. The EPA is currently 

the reviewing authority for PSD and 

NNSR permits issued in tribal lands 

and, as such, the revisions being 

proposed will not impose direct 

burdens on tribal authorities. Thus, 

Executive Order 13175 does not apply 

to this action. 

G. Executive Order 13045: Protection of 

Children From Environmental Health 

and Safety Risks 

The EPA interprets Executive Order 

13045 as applying only to those 

regulatory actions that concern 

environmental health or safety risks that 

the EPA has reason to believe may 

disproportionately affect children, per 

the definition of ‘‘covered regulatory 

action’’ in section 2–202 of the 

Executive Order. This action is not 

subject to Executive Order 13045 

because it does not concern an 

environmental health risk or safety risk. 

H. Executive Order 13211: Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use 

This action is not a ‘‘significant 

energy action’’ because it is not likely to 

have a significant adverse effect on the 

supply, distribution or use of energy. 

This proposed rule will impact the NSR 

applicability process, and the 

recordkeeping and reporting provisions 

associated with that process. As such, it 

is not likely to significantly impact the 

number of sources subject to permitting 

requirements but will only facilitate 

transparency and accountability for 

those sources that would otherwise have 

been subject to permitting requirements. 

I. National Technology Transfer and 

Advancement Act (NTTAA) 

This rulemaking does not involve 

technical standards. 

J. Executive Order 12898: Federal 

Actions To Address Environmental 

Justice in Minority Populations and 

Low-Income Populations and Executive 

Order 14096: Revitalizing Our Nation’s 

Commitment to Environmental Justice 

for All 

The EPA believes that it is not 

practicable to assess whether the human 

health or environmental conditions that 

exist prior to this action result in 

disproportionate and adverse effects on 

communities with environmental justice 

concerns. This is due to the lack of 

permitting data necessary for the EPA to 

evaluate the number of sources likely to 

be impacted by this action. 

Additionally, the impacts of the 

proposal on the benefits and costs of the 

NSR program are likely to vary greatly 

depending on the source category, 

number and location of facilities, and 

the pollutants and potential controls 

addressed. The NSR program is largely 

implemented by state and local 

permitting authorities. These programs 

vary with respect to whether they 

implement PEA,106 whether their 

applicability process allows for sourcewide netting, and what information they 

require from sources applying for a 

permit.107

However, there are numerous 

challenges to quantifying potential cost 

and emissions impacts of the proposal. 

The EPA lacks systematic data on the 

permitting process because the NSR 

program is largely implemented by state 

and local permitting authorities. The 

EPA also faces the absence of 

information on projects that do not 

engage with NSR under requirements in 

the baseline but might under the 

proposed provisions. 

For example, major source permits are 

not submitted to the EPA, but to state 

and local permitting authorities. There 

is currently no centralized database 

where this permitting information is 

maintained. Minor source permitting is 

generally performed at the state and 

local levels, and there is a high degree 

of variation with respect to how state 

and local authorities permit non-major 

sources. Additionally, there are 

currently instances where a source may 

trigger the reasonable possibility 

recordkeeping and reporting 

requirements but not any other 

permitting requirements. If the source 

does not include an electric utility 

steam generating unit, then that source 

(under our current Federal regulations) 

does not need to notify anyone that 

these requirements were triggered. In 

these cases, under the current 

regulations, the reviewing authority and 

the public are not provided notification 

that records are being maintained as 

required by the reasonable possibility in 

recordkeeping provisions. 

The EPA is proposing this rulemaking 

to fill some of these gaps identified in 

permitting information that is collected. 

For example, if finalized, this rule 

would require that sources inform the 

reviewing authority that records were 

maintained in compliance with the 

reasonable possibility requirements. The 

reviewing authority is then required to 

inform the public that these records are 

available for public review, if such 

review is requested. The EPA is 

additionally exploring the potential 

development of a database to collect 

permitting information and other 

recordkeeping and reporting 

information. 

Despite the difficulties associated 

with quantitatively estimating the 

impacts of this proposal, the EPA 

believes that this action does not have 

disproportionate and adverse human 

health or environmental effects on 

communities with environmental justice 

concerns. Rather, the EPA expects that 

the overall impacts of the 

implementation of the proposed 

changes to the NSR program will 

improve the implementation, 

enforcement, and public transparency of 

the NSR program that may result in 

benefits to all communities including 

those with environmental justice 

concerns. 

The proposed revisions to the 

recordkeeping and reporting 

requirements are likely to improve 

public transparency of permit terms and 

conditions. In this way, there may be 

benefits to populations with 

environmental justice concerns that are 

more likely to be impacted by the 

emissions of sources subject to the 

‘‘reasonable possibility’’ in 


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recordkeeping and reporting provisions. 

Additionally, the requirement that 

decreases accounted for in the NSR 

applicability process be made 

enforceable would improve the 

enforceability of emissions estimates 

used in the NSR applicability process. 

This improved enforcement, will ensure 

that decreases accounted for in the 

project emissions accounting process 

occur as projected. The revisions 

proposed in this action to both the 

recordkeeping and reporting provisions 

as well as the enforceability of 

calculations used in the NSR 

applicability process will reduce the 

barriers to public participation in the 

permitting process by providing the 

public and permitting authorities more 

information on the project and the 

emissions associated with that project. 

The EPA conducted outreach during 

the development of this proposed 

rulemaking to environmental nonprofit 

groups that petitioned the EPA on the 

project emissions accounting rule, as 

well as to state permitting authority 

associations, industry groups, and 

Tribal groups. Additionally, as part of 

other ongoing policy reviews of minor 

NSR programs, the EPA has conducted 

outreach that, among other topics, 

considered public notification 

requirements for minor modifications at 

major sources. Those outreach sessions 

were provided to the same 

environmental nonprofit groups the 

EPA met with for this action as well as 

with industry, state permitting 

authorities, and other environmental 

justice groups. The feedback obtained 

from those sessions informed aspects of 

this action as pertains to the revisions 

to the reasonable possibility in 

recordkeeping and reporting provisions 

and will inform public notice 

requirements that will be proposed as 

part of a subsequent action. 

XI. Statutory Authority 

The statutory authority for this action 

is provided by 42 U.S.C. 7401, et seq. 

List of Subjects in 40 CFR Parts 51 and 

52 

Environmental protection, Air 

pollution control. 

Michael S. Regan, 

Administrator. 

For the reasons stated in the 

preamble, title 40, chapter I of the Code 

of Federal Regulations is proposed to be 

amended as follows: 

PART 51—REQUIREMENTS FOR 

PREPARATION, ADOPTION, AND 

SUBMITTAL OF IMPLEMENTATION 

PLAN 

■ 1. The authority citation for part 51 

continues to read as follows: 

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

7671 q. 

Subpart I—Review of New Sources and 

Modifications 

§ 51.165 [Amended] 

■ 2. Amend § 51.165 by revising and 

republishing paragraphs (a)(1), (2), and 

(6) to read as follows: 

§ 51.165 Permit requirements. 

(a) State Implementation Plan and 

Tribal Implementation Plan provisions 

satisfying sections 172(c)(5) and 173 of 

the Act shall meet the following 

conditions: 

(1) All such plans shall use the 

specific definitions. Deviations from the 

following wording will be approved 

only if the State specifically 

demonstrates that the submitted 

definition is more stringent, or at least 

as stringent, in all respects as the 

corresponding definition below: 

(i) Stationary source means any 

building, structure, facility, or 

installation which emits or may emit a 

regulated NSR pollutant. 

(ii)(A) Building, structure, facility, or 

installation means all of the pollutantemitting activities which belong to the 

same industrial grouping, are located on 

one or more contiguous or adjacent 

properties, and are under the control of 

the same person (or persons under 

common control) except the activities of 

any vessel. Pollutant emitting activities 

shall be considered as part of the same 

industrial grouping if they belong to the 

same Major Group (i.e., which have the 

same two-digit code) as described in the 

Standard Industrial Classification 

Manual, 1972, as amended by the 1977 

Supplement (U.S. Government Printing 

Office stock numbers 4101–0065 and 

003–005–00176–0, respectively). 

(B) The plan may include the 

following provision: Notwithstanding 

the provisions of paragraph (a)(1)(ii)(A) 

of this section, building, structure, 

facility, or installation means, for 

onshore activities under Standard 

Industrial Classification (SIC) Major 

Group 13: Oil and Gas Extraction, all of 

the pollutant-emitting activities 

included in Major Group 13 that are 

located on one or more contiguous or 

adjacent properties, and are under the 

control of the same person (or persons 

under common control). Pollutant 

emitting activities shall be considered 

adjacent if they are located on the same 

surface site; or if they are located on 

surface sites that are located within 

1/4 mile of one another (measured from 

the center of the equipment on the 

surface site) and they share equipment. 

Shared equipment includes, but is not 

limited to, produced fluids storage 

tanks, phase separators, natural gas 

dehydrators or emissions control 

devices. Surface site, as used in this 

paragraph (a)(1)(ii)(B), has the same 

meaning as in 40 CFR 63.761. 

(iii) Potential to emit means the 

maximum capacity of a stationary 

source to emit a pollutant under its 

physical and operational design. Any 

physical or operational limitation on the 

capacity of the source to emit a 

pollutant, including air pollution 

control equipment and restrictions on 

hours of operation or on the type or 

amount of material combusted, stored, 

or processed, shall be treated as part of 

its design only if the limitation or the 

effect it would have on emissions is 

federally enforceable. Secondary 

emissions do not count in determining 

the potential to emit of a stationary 

source. 

(iv) (A) Major stationary source 

means: 

(1) Any stationary source of air 

pollutants that emits, or has the 

potential to emit, 100 tons per year or 

more of any regulated NSR pollutant (as 

defined in paragraph (a)(1)(xxxvii) of 

this section), except that lower 

emissions thresholds shall apply in 

areas subject to subpart 2, subpart 3, or 

subpart 4 of part D, title I of the Act, 

according to paragraphs 

(a)(1)(iv)(A)(1)(i) through (viii) of this 

section. 

(i) 50 tons per year of Volatile organic 

compounds in any serious ozone 

nonattainment area. 

(ii) 50 tons per year of Volatile organic 

compounds in an area within an ozone 

transport region, except for any severe 

or extreme ozone nonattainment area. 

(iii) 25 tons per year of Volatile 

organic compounds in any severe ozone 

nonattainment area. 

(iv) 10 tons per year of Volatile 

organic compounds in any extreme 

ozone nonattainment area. 

(v) 50 tons per year of Carbon 

monoxide in any serious nonattainment 

area for carbon monoxide, where 

stationary sources contribute 

significantly to Carbon monoxide levels 

in the area (as determined under rules 

issued by the Administrator). 

(vi) 70 tons per year of PM10 in any 

serious nonattainment area for PM10.

(vii) 70 tons per year of PM2.5 in any 

serious nonattainment area for PM2.5.


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(viii) 70 tons per year of any 

individual precursor for PM2.5 (as 

defined in paragraph (a)(1)(xxxvii) of 

this section), in any serious 

nonattainment area for PM2.5.

(2) For the purposes of applying the 

requirements of paragraph (a)(8) of this 

section to stationary sources of nitrogen 

oxides located in an ozone 

nonattainment area or in an ozone 

transport region, any stationary source 

which emits, or has the potential to 

emit, 100 tons per year or more of 

nitrogen oxides emissions, except that 

the emission thresholds in paragraphs 

(a)(1)(iv)(A)(2)(i) through (vi) of this 

section shall apply in areas subject to 

subpart 2 of part D, title I of the Act. 

(i) 100 tons per year or more of 

nitrogen oxides in any ozone 

nonattainment area classified as 

marginal or moderate. 

(ii) 100 tons per year or more of 

nitrogen oxides in any ozone 

nonattainment area classified as a 

transitional, submarginal, or incomplete 

or no data area, when such area is 

located in an ozone transport region. 

(iii) 100 tons per year or more of 

nitrogen oxides in any area designated 

under section 107(d) of the Act as 

attainment or unclassifiable for ozone 

that is located in an ozone transport 

region. 

(iv) 50 tons per year or more of 

nitrogen oxides in any serious 

nonattainment area for ozone. 

(v) 25 tons per year or more of 

nitrogen oxides in any severe 

nonattainment area for ozone. 

(vi) 10 tons per year or more of 

nitrogen oxides in any extreme 

nonattainment area for ozone; or 

(3) Any physical change that would 

occur at a stationary source not 

qualifying under paragraphs 

(a)(1)(iv)(A)(1) or (2) of this section as a 

major stationary source, if the change 

would constitute a major stationary 

source by itself. 

(B) A major stationary source that is 

major for volatile organic compounds 

shall be considered major for ozone 

(C) The fugitive emissions of a 

stationary source shall not be included 

in determining for any of the purposes 

of this paragraph whether it is a major 

stationary source, unless the source 

belongs to one of the following 

categories of stationary sources: 

(1) Coal cleaning plants (with thermal 

dryers); 

(2) Kraft pulp mills; 

(3) Portland cement plants; 

(4) Primary zinc smelters; 

(5) Iron and steel mills; 

(6) Primary aluminum ore reduction 

plants; 

(7) Primary copper smelters; 

(8) Municipal incinerators capable of 

charging more than 50 tons of refuse per 

day; 

(9) Hydrofluoric, sulfuric, or nitric 

acid plants; 

(10) Petroleum refineries; 

(11) Lime plants; 

(12) Phosphate rock processing plants; 

(13) Coke oven batteries; 

(14) Sulfur recovery plants; 

(15) Carbon black plants (furnace 

process); (16) Primary lead smelters; 

(17) Fuel conversion plants; 

(18) Sintering plants; 

(19) Secondary metal production 

plants; 

(20) Chemical process plants—The 

term chemical processing plant shall not 

include ethanol production facilities 

that produce ethanol by natural 

fermentation included in NAICS codes 

325193 or 312140; 

(21) Fossil-fuel boilers (or 

combination thereof) totaling more than 

250 million British thermal units per 

hour heat input; 

(22) Petroleum storage and transfer 

units with a total storage capacity 

exceeding 300,000 barrels; 

(23) Taconite ore processing plants; 

(24) Glass fiber processing plants; 

(25) Charcoal production plants; 

(26) Fossil fuel-fired steam electric 

plants of more than 250 million British 

thermal units per hour heat input; and 

(27) Any other stationary source 

category which, as of August 7, 1980, is 

being regulated under section 111 or 

112 of the Act. 

(v)(A) Major modification means any 

physical change in or change in the 

method of operation of a major 

stationary source that would result in: 

(1) A significant emissions increase of 

a regulated NSR pollutant (as defined in 

paragraph (a)(1)(xxxvii) of this section); 

and 

(2) A significant net emissions 

increase of that pollutant from the major 

stationary source. 

(B) Any significant emissions increase 

(as defined in paragraph (a)(1)(xxvii) of 

this section) from any emissions units or 

net emissions increase (as defined in 

paragraph (a)(1)(vi) of this section) at a 

major stationary source that is 

significant for volatile organic 

compounds shall be considered 

significant for ozone. 

(C) A physical change or change in 

the method of operation shall not 

include: 

(1) Routine maintenance, repair and 

replacement; 

(2) Use of an alternative fuel or raw 

material by reason of an order under 

sections 2 (a) and (b) of the Energy 

Supply and Environmental 

Coordination Act of 1974 (or any 

superseding legislation) or by reason of 

a natural gas curtailment plan pursuant 

to the Federal Power Act; 

(3) Use of an alternative fuel by reason 

of an order or rule section 125 of the 

Act; 

(4) Use of an alternative fuel at a 

steam generating unit to the extent that 

the fuel is generated from municipal 

solid waste; 

(5) Use of an alternative fuel or raw 

material by a stationary source which; 

(i) The source was capable of 

accommodating before December 21, 

1976, unless such change would be 

prohibited under any federally 

enforceable permit condition which was 

established after December 12, 1976, 

pursuant to 40 CFR 52.21 or under 

regulations approved pursuant to 40 

CFR part 51, subpart I. 

(ii) The source is approved to use 

under any permit issued under 

regulations approved pursuant to this 

section; 

(6) An increase in the hours of 

operation or in the production rate, 

unless such change is prohibited under 

any federally enforceable permit 

condition which was established after 

December 21, 1976, pursuant to 40 CFR 

52.21 or regulations approved pursuant 

to 40 CFR part 51, subpart I. 

(7) Any change in ownership at a 

stationary source. 

(8) [Reserved] 

(9) The installation, operation, 

cessation, or removal of a temporary 

clean coal technology demonstration 

project, provided that the project 

complies with: 

(i) The State Implementation Plan for 

the State in which the project is located, 

and 

(ii) Other requirements necessary to 

attain and maintain the national 

ambient air quality standard during the 

project and after it is terminated. 

(D) This definition shall not apply 

with respect to a particular regulated 

NSR pollutant when the major 

stationary source is complying with the 

requirements under paragraph (f) of this 

section for a PAL for that pollutant. 

Instead, the definition at paragraph 

(f)(2)(viii) of this section shall apply. 

(E) For the purpose of applying the 

requirements of paragraph (a)(8) of this 

section to modifications at major 

stationary sources of nitrogen oxides 

located in ozone nonattainment areas or 

in ozone transport regions, whether or 

not subject to subpart 2, part D, title I 

of the Act, any significant net emissions 

increase of nitrogen oxides is 

considered significant for ozone. 

(F) Any physical change in, or change 

in the method of operation of, a major 

stationary source of volatile organic 


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compounds that results in any increase 

in emissions of volatile organic 

compounds from any discrete operation, 

emissions unit, or other pollutant 

emitting activity at the source shall be 

considered a significant net emissions 

increase and a major modification for 

ozone, if the major stationary source is 

located in an extreme ozone 

nonattainment area. A reduction in 

emissions of volatile organic 

compounds may not be used to 

determine if a modification will result 

in a major modification. 

(G) Fugitive emissions shall not be 

included in determining for any of the 

purposes of this section whether a 

physical change in or change in the 

method of operation of a major 

stationary source is a major 

modification, unless the source belongs 

to one of the source categories listed in 

paragraph (a)(1)(iv)(C) of this section. 

(vi) (A) Net emissions increase means, 

with respect to any regulated NSR 

pollutant emitted by a major stationary 

source, the amount by which the sum of 

the following exceeds zero: 

(1) The increase in emissions from a 

particular physical change or change in 

the method of operation at a stationary 

source as calculated pursuant to 

paragraph (a)(2)(ii) of this section; and 

(2) Any other increases and decreases 

in actual emissions at the major 

stationary source that are 

contemporaneous with the particular 

change and are otherwise creditable. 

Baseline actual emissions for calculating 

increases and decreases under this 

paragraph (a)(1)(vi)(A)(2) shall be 

determined as provided in paragraph 

(a)(1)(xxxv) of this section, except that 

paragraphs (a)(1)(xxxv)(A)(3) and 

(a)(1)(xxxv)(B)(4) of this section shall 

not apply. 

(B) An increase or decrease in actual 

emissions is contemporaneous with the 

increase from the particular change only 

if it occurs before the date that the 

increase from the particular change 

occurs; 

(C) An increase or decrease in actual 

emissions is creditable only if: 

(1) It occurs within a reasonable 

period to be specified by the reviewing 

authority; and 

(2) The reviewing authority has not 

relied on it in issuing a permit for the 

source under regulations approved 

pursuant to this section, which permit 

is in effect when the increase in actual 

emissions from the particular change 

occurs; and 

(3) As it pertains to an increase or 

decrease in fugitive emissions (to the 

extent quantifiable), it occurs at an 

emissions unit that is part of one of the 

source categories listed in paragraph 

(a)(1)(iv)(C) of this section or it occurs 

at an emissions unit that is located at a 

major stationary source that belongs to 

one of the listed source categories. 

Fugitive emission increases or decreases 

are not creditable for those emissions 

units located at a facility whose primary 

activity is not represented by one of the 

source categories listed in paragraph 

(a)(1)(iv)(C) of this section and that are 

not, by themselves, part of a listed 

source category. 

(D) An increase in actual emissions is 

creditable only to the extent that the 

new level of actual emissions exceeds 

the old level. 

(E) A decrease in actual emissions is 

creditable only to the extent that: 

(1) The old level of actual emission or 

the old level of allowable emissions 

whichever is lower, exceeds the new 

level of actual emissions; 

(2) It is enforceable as a practical 

matter at and after the time that actual 

construction on the particular change 

begins; and 

(3) The reviewing authority has not 

relied on it in issuing any permit under 

regulations approved pursuant to 40 

CFR part 51 subpart or the State has not 

relied on it in demonstrating attainment 

or reasonable further progress; 

(4) It has approximately the same 

qualitative significance for public health 

and welfare as that attributed to the 

increase from the particular change; and 

(F) An increase that results from a 

physical change at a source occurs when 

the emissions unit on which 

construction occurred becomes 

operational and begins to emit a 

particular pollutant. Any replacement 

unit that requires shakedown becomes 

operational only after a reasonable 

shakedown period, not to exceed 180 

days. 

(G) Paragraph (a)(1)(xii)(B) of this 

section shall not apply for determining 

creditable increases and decreases or 

after a change. 

(vii) Emissions unit means any part of 

a stationary source that emits or would 

have the potential to emit any regulated 

NSR pollutant and includes an electric 

steam generating unit as defined in 

paragraph (a)(1)(xx) of this section. For 

purposes of this section, there are two 

types of emissions units as described in 

paragraphs (a)(1)(vii)(A) and (B) of this 

section. 

(A) A new emissions unit is any 

emissions unit which is (or will be) 

newly constructed and which has 

existed for less than 2 years from the 

date such emissions unit first operated. 

(B) An existing emissions unit is any 

emissions unit that does not meet the 

requirements in paragraph (a)(1)(vii)(A) 

of this section. A replacement unit, as 

defined in paragraph (a)(1)(xxi) of this 

section, is an existing emissions unit. 

(viii) Secondary emissions means 

emissions which would occur as a result 

of the construction or operation of a 

major stationary source or major 

modification, but do not come from the 

major stationary source or major 

modification itself. For the purpose of 

this section, secondary emissions must 

be specific, well defined, quantifiable, 

and impact the same general area as the 

stationary source or modification which 

causes the secondary emissions. 

Secondary emissions include emissions 

from any offsite support facility which 

would not be constructed or increase its 

emissions except as a result of the 

construction or operation of the major 

stationary source or major modification. 

Secondary emissions do not include any 

emissions which come directly from a 

mobile source, such as emissions from 

the tailpipe of a motor vehicle, from a 

train, or from a vessel. 

(ix) Fugitive emissions means those 

emissions which could not reasonably 

pass through a stack, chimney, vent or 

other functionally equivalent opening. 

(x)(A) Significant means, in reference 

to a net emissions increase or the 

potential of a source to emit any of the 

following pollutants, a rate of emissions 

that would equal or exceed any of the 

following rates: 

Pollutant Emission Rate 

Carbon monoxide: 100 tons per year (tpy) 

Nitrogen oxides: 40 tpy 

Sulfur dioxide: 40 tpy 

Ozone: 40 tpy of Volatile organic 

compounds or Nitrogen oxides 

Lead: 0.6 tpy 

PM10: 15 tpy 

PM2.5: 10 tpy of direct PM2.5 emissions; 40 

tpy of Sulfur dioxide emissions, 40 tpy 

of Nitrogen oxide emissions, or 40 tpy of 

VOC emissions, to the extent that any 

such pollutant is defined as a precursor 

for PM2.5 in paragraph (a)(1)(xxxvii) of 

this section. 

(B) Notwithstanding the significant 

emissions rate for ozone in paragraph 

(a)(1)(x)(A) of this section, significant 

means, in reference to an emissions 

increase or a net emissions increase, any 

increase in actual emissions of volatile 

organic compounds that would result 

from any physical change in, or change 

in the method of operation of, a major 

stationary source locating in a serious or 

severe ozone nonattainment area, if 

such emissions increase of volatile 

organic compounds exceeds 25 tons per 

year when aggregated with all other net 

increases in emissions from the source 

over any period of 5 consecutive 

calendar years which includes the 

calendar year in which such increase 

occurred. 


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(C) For the purposes of applying the 

requirements of paragraph (a)(8) of this 

section to modifications at major 

stationary sources of nitrogen oxides 

located in an ozone nonattainment area 

or in an ozone transport region, the 

significant emission rates and other 

requirements for volatile organic 

compounds in paragraphs (a)(1)(x)(A), 

(B), and (E) of this section shall apply 

to nitrogen oxides emissions. 

(D) Notwithstanding the significant 

emissions rate for carbon monoxide 

under paragraph (a)(1)(x)(A) of this 

section, significant means, in reference 

to an emissions increase or a net 

emissions increase, any increase in 

actual emissions of carbon monoxide 

that would result from any physical 

change in, or change in the method of 

operation of, a major stationary source 

in a serious nonattainment area for 

carbon monoxide if such increase equals 

or exceeds 50 tons per year, provided 

the Administrator has determined that 

stationary sources contribute 

significantly to carbon monoxide levels 

in that area. 

(E) Notwithstanding the significant 

emissions rates for ozone under 

paragraphs (a)(1)(x)(A) and (B) of this 

section, any increase in actual emissions 

of volatile organic compounds from any 

emissions unit at a major stationary 

source of volatile organic compounds 

located in an extreme ozone 

nonattainment area shall be considered 

a significant net emissions increase. A 

reduction in emissions of volatile 

organic compounds from discrete 

operations, units, or activities within 

the source may not be used to determine 

if a modification will result in a major 

modification. 

(F) For the purposes of applying the 

requirements of paragraph (a)(13) of this 

section to modifications at existing 

major stationary sources of Ammonia 

located in a PM2.5 nonattainment area, if 

the plan requires that the control 

requirements of this section apply to 

major stationary sources and major 

modifications of Ammonia as a 

regulated NSR pollutant (as a PM2.5

precursor), the plan shall also define 

‘‘significant’’ for Ammonia for that area, 

subject to the approval of the 

Administrator. 

(xi) Allowable emissions means the 

emissions rate of a stationary source 

calculated using the maximum rated 

capacity of the source (unless the source 

is subject to federally enforceable limits 

which restrict the operating rate, or 

hours of operation, or both) and the 

most stringent of the following: 

(A) The applicable standards set forth 

in 40 CFR part 60 or 61; 

(B) Any applicable State 

Implementation Plan emissions 

limitation including those with a future 

compliance date; or 

(C) The emissions rate specified as a 

federally enforceable permit condition, 

including those with a future 

compliance date. 

(xii) (A) Actual emissions means the 

actual rate of emissions of a regulated 

NSR pollutant from an emissions unit, 

as determined in accordance with 

paragraphs (a)(1)(xii)(B) through (D) of 

this section, except that this definition 

shall not apply for calculating whether 

a significant emissions increase has 

occurred, or for establishing a PAL 

under paragraph (f) of this section. 

Instead, paragraphs (a)(1)(xxviii) and 

(xxxv) of this section shall apply for 

those purposes. 

(B) In general, actual emissions as of 

a particular date shall equal the average 

rate, in tons per year, at which the unit 

actually emitted the pollutant during a 

consecutive 24-month period which 

precedes the particular date and which 

is representative of normal source 

operation. The reviewing authority shall 

allow the use of a different time period 

upon a determination that it is more 

representative of normal source 

operation. Actual emissions shall be 

calculated using the unit’s actual 

operating hours, production rates, and 

types of materials processed, stored, or 

combusted during the selected time 

period. 

(C) The reviewing authority may 

presume that source-specific allowable 

emissions for the unit are equivalent to 

the actual emissions of the unit. 

(D) For any emissions unit that has 

not begun normal operations on the 

particular date, actual emissions shall 

equal the potential to emit of the unit on 

that date. 

(xiii) Lowest achievable emission rate 

(LAER) means, for any source, the more 

stringent rate of emissions based on the 

following: 

(A) The most stringent emissions 

limitation which is contained in the 

implementation plan of any State for 

such class or category of stationary 

source, unless the owner or operator of 

the proposed stationary source 

demonstrates that such limitations are 

not achievable; or 

(B) The most stringent emissions 

limitation which is achieved in practice 

by such class or category of stationary 

sources. This limitation, when applied 

to a modification, means the lowest 

achievable emissions rate for the new or 

modified emissions units within or 

stationary source. In no event shall the 

application of the term permit a 

proposed new or modified stationary 

source to emit any pollutant in excess 

of the amount allowable under an 

applicable new source standard of 

performance. 

(xiv) Federally enforceable means all 

limitations and conditions which are 

enforceable by the Administrator, 

including those requirements developed 

pursuant to 40 CFR parts 60 and 61, 

requirements within any applicable 

State implementation plan, any permit 

requirements established pursuant to 40 

CFR 52.21 or under regulations 

approved pursuant to 40 CFR part 51, 

subpart I, including operating permits 

issued under an EPA-approved program 

that is incorporated into the State 

implementation plan and expressly 

requires adherence to any permit issued 

under such program. 

(xv) Begin actual construction means 

in general, initiation of physical on-site 

construction activities on an emissions 

unit which are of a permanent nature. 

Such activities include, but are not 

limited to, installation of building 

supports and foundations, laying of 

underground pipework, and 

construction of permanent storage 

structures. With respect to a change in 

method of operating this term refers to 

those on-site activities other than 

preparatory activities which mark the 

initiation of the change. 

(xvi) Commence as applied to 

construction of a major stationary 

source or major modification means that 

the owner or operator has all necessary 

preconstruction approvals or permits 

and either has: 

(A) Begun, or caused to begin, a 

continuous program of actual on-site 

construction of the source, to be 

completed within a reasonable time; or 

(B) Entered into binding agreements 

or contractual obligations, which cannot 

be canceled or modified without 

substantial loss to the owner or 

operator, to undertake a program of 

actual construction of the source to be 

completed within a reasonable time. 

(xvii) Necessary preconstruction 

approvals or permits means those 

Federal air quality control laws and 

regulations and those air quality control 

laws and regulations which are part of 

the applicable State Implementation 

Plan. 

(xviii) Construction means any 

physical change or change in the 

method of operation (including 

fabrication, erection, installation, 

demolition, or modification of an 

emissions unit) that would result in a 

change in emissions. 

(xix) Volatile organic compounds 

(VOC) is as defined in § 51.100(s) of this 

part. 


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(xx) Electric utility steam generating 

unit means any steam electric 

generating unit that is constructed for 

the purpose of supplying more than 

one-third of its potential electric output 

capacity and more than 25 MW 

electrical output to any utility power 

distribution system for sale. Any steam 

supplied to a steam distribution system 

for the purpose of providing steam to a 

steam-electric generator that would 

produce electrical energy for sale is also 

considered in determining the electrical 

energy output capacity of the affected 

facility. 

(xxi) Replacement unit means an 

emissions unit for which all the criteria 

listed in paragraphs (a)(1)(xxi)(A) 

through (D) of this section are met. No 

creditable emission reductions shall be 

generated from shutting down the 

existing emissions unit that is replaced. 

(A) The emissions unit is a 

reconstructed unit within the meaning 

of § 60.15(b)(1) of this chapter, or the 

emissions unit completely takes the 

place of an existing emissions unit; 

(B) The emissions unit is identical to 

or functionally equivalent to the 

replaced emissions unit; 

(C) The replacement does not alter the 

basic design parameters of the process 

unit; and 

(D) The replaced emissions unit is 

permanently removed from the major 

stationary source, otherwise 

permanently disabled, or permanently 

barred from operation by a permit that 

is enforceable as a practical matter. If 

the replaced emissions unit is brought 

back into operation, it shall constitute a 

new emissions unit. 

(xxii) Temporary clean coal 

technology demonstration project means 

a clean coal technology demonstration 

project that is operated for a period of 

5 years or less, and which complies 

with the State Implementation Plan for 

the State in which the project is located 

and other requirements necessary to 

attain and maintain the national 

ambient air quality standards during the 

project and after it is terminated. 

(xxiii) Clean coal technology means 

any technology, including technologies 

applied at the precombustion, 

combustion, or post combustion stage, 

at a new or existing facility which will 

achieve significant reductions in air 

emissions of sulfur dioxide or oxides of 

nitrogen associated with the utilization 

of coal in the generation of electricity, 

or process steam which was not in 

widespread use as of November 15, 

1990. 

(xxiv) Clean coal technology 

demonstration project means a project 

using funds appropriated under the 

heading ‘‘Department of Energy-Clean 

Coal Technology,’’ up to a total amount 

of $2,500,000,000 for commercial 

demonstration of clean coal technology, 

or similar projects funded through 

appropriations for the Environmental 

Protection Agency. The Federal 

contribution for a qualifying project 

shall be at least 20 percent of the total 

cost of the demonstration project. 

(xxv) [Reserved] 

(xxvi) Pollution prevention means any 

activity that through process changes, 

product reformulation or redesign, or 

substitution of less polluting raw 

materials, eliminates or reduces the 

release of air pollutants (including 

fugitive emissions) and other pollutants 

to the environment prior to recycling, 

treatment, or disposal; it does not mean 

recycling (other than certain ‘‘in-process 

recycling’’ practices), energy recovery, 

treatment, or disposal. 

(xxvii) Significant emissions increase 

means, for a regulated NSR pollutant, an 

increase in emissions that is significant 

(as defined in paragraph (a)(1)(x) of this 

section) for that pollutant. 

(xxviii)(A) Projected actual emissions 

means, the maximum annual rate, in 

tons per year, at which an existing 

emissions unit is projected to emit a 

regulated NSR pollutant in any one of 

the 5 years (12-month period) following 

the date the unit resumes regular 

operation after the project, or in any one 

of the 10 years following that date, if the 

project involves increasing the 

emissions unit’s design capacity or its 

potential to emit of that regulated NSR 

pollutant and full utilization of the unit 

would result in a significant emissions 

increase or a significant net emissions 

increase at the major stationary source. 

(B) In determining the projected 

actual emissions under paragraph 

(a)(1)(xxviii)(A) of this section before 

beginning actual construction, the 

owner or operator of the major 

stationary source: 

(1) Shall consider all relevant 

information, including but not limited 

to, historical operational data, the 

company’s own representations, the 

company’s expected business activity 

and the company’s highest projections 

of business activity, the company’s 

filings with the State or Federal 

regulatory authorities, and compliance 

plans under the approved plan; and 

(2) Shall include fugitive emissions to 

the extent quantifiable, and emissions 

associated with startups, shutdowns, 

and malfunctions; and 

(3) Shall exclude, in calculating any 

increase in emissions that results from 

the particular project, that portion of the 

unit’s emissions following the project 

that an existing unit could have 

accommodated during the consecutive 

24-month period used to establish the 

baseline actual emissions under 

paragraph (a)(1)(xxxv) of this section 

and that are also unrelated to the 

particular project, including any 

increased utilization due to product 

demand growth; or, 

(4) In lieu of using the method set out 

in paragraphs (a)(1)(xxviii)(B)(1) 

through (3) of this section, may elect to 

use the emissions unit’s potential to 

emit, in tons per year, as defined under 

paragraph (a)(1)(iii) of this section. 

(xxix) [Reserved] 

(xxx) Nonattainment major new 

source review (NSR) program means a 

major source preconstruction permit 

program that has been approved by the 

Administrator and incorporated into the 

plan to implement the requirements of 

this section, or a program that 

implements part 51, appendix S, 

Sections I through VI of this chapter. 

Any permit issued under such a 

program is a major NSR permit. 

(xxxi) Continuous emissions 

monitoring system (CEMS) means all of 

the equipment that may be required to 

meet the data acquisition and 

availability requirements of this section, 

to sample, condition (if applicable), 

analyze, and provide a record of 

emissions on a continuous basis. 

(xxxii) Predictive emissions 

monitoring system (PEMS) means all of 

the equipment necessary to monitor 

process and control device operational 

parameters (for example, control device 

secondary voltages and electric 

currents) and other information (for 

example, gas flow rate, O2 or CO2

concentrations), and calculate and 

record the mass emissions rate (for 

example, lb/hr) on a continuous basis. 

(xxxiii) Continuous parameter 

monitoring system (CPMS) means all of 

the equipment necessary to meet the 

data acquisition and availability 

requirements of this section, to monitor 

process and control device operational 

parameters (for example, control device 

secondary voltages and electric 

currents) and other information (for 

example, gas flow rate, O2 or CO2

concentrations), and to record average 

operational parameter value(s) on a 

continuous basis. 

(xxxiv) Continuous emissions rate 

monitoring system (CERMS) means the 

total equipment required for the 

determination and recording of the 

pollutant mass emissions rate (in terms 

of mass per unit of time). 

(xxxv) Baseline actual emissions 

means the rate of emissions, in tons per 

year, of a regulated NSR pollutant, as 

determined in accordance with 

paragraphs (a)(1)(xxxv)(A) through (D) 

of this section. 


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(A) For any existing electric utility 

steam generating unit, baseline actual 

emissions means the average rate, in 

tons per year, at which the unit actually 

emitted the pollutant during any 

consecutive 24-month period selected 

by the owner or operator within the 5- 

year period immediately preceding 

when the owner or operator begins 

actual construction of the project. The 

reviewing authority shall allow the use 

of a different time period upon a 

determination that it is more 

representative of normal source 

operation. 

(1) The average rate shall include 

fugitive emissions to the extent 

quantifiable, and emissions associated 

with startups, shutdowns, and 

malfunctions. 

(2) The average rate shall be adjusted 

downward to exclude any noncompliant emissions that occurred 

while the source was operating above 

any emission limitation that was legally 

enforceable during the consecutive 24- 

month period. 

(3) For a regulated NSR pollutant, 

when a project involves multiple 

emissions units, only one consecutive 

24-month period must be used to 

determine the baseline actual emissions 

for the emissions units being changed. 

A different consecutive 24-month 

period can be used for each regulated 

NSR pollutant. 

(4) The average rate shall not be based 

on any consecutive 24-month period for 

which there is inadequate information 

for determining annual emissions, in 

tons per year, and for adjusting this 

amount if required by paragraph 

(a)(1)(xxxv)(A)(2) of this section. 

(B) For an existing emissions unit 

(other than an electric utility steam 

generating unit), baseline actual 

emissions means the average rate, in 

tons per year, at which the emissions 

unit actually emitted the pollutant 

during any consecutive 24-month 

period selected by the owner or operator 

within the 10-year period immediately 

preceding either the date the owner or 

operator begins actual construction of 

the project, or the date a complete 

permit application is received by the 

reviewing authority for a permit 

required either under this section or 

under a plan approved by the 

Administrator, whichever is earlier, 

except that the 10-year period shall not 

include any period earlier than 

November 15, 1990. 

(1) The average rate shall include 

fugitive emissions to the extent 

quantifiable, and emissions associated 

with startups, shutdowns, and 

malfunctions. 

(2) The average rate shall be adjusted 

downward to exclude any noncompliant emissions that occurred 

while the source was operating above an 

emission limitation that was legally 

enforceable during the consecutive 24- 

month period. 

(3) The average rate shall be adjusted 

downward to exclude any emissions 

that would have exceeded an emission 

limitation with which the major 

stationary source must currently 

comply, had such major stationary 

source been required to comply with 

such limitations during the consecutive 

24-month period. However, if an 

emission limitation is part of a 

maximum achievable control 

technology standard that the 

Administrator proposed or promulgated 

under part 63 of this chapter, the 

baseline actual emissions need only be 

adjusted if the State has taken credit for 

such emissions reductions in an 

attainment demonstration or 

maintenance plan consistent with the 

requirements of paragraph (a)(3)(ii)(G) of 

this section. 

(4) For a regulated NSR pollutant, 

when a project involves multiple 

emissions units, only one consecutive 

24-month period must be used to 

determine the baseline actual emissions 

for the emissions units being changed. 

A different consecutive 24-month 

period can be used. For each regulated 

NSR pollutant. 

(5) The average rate shall not be based 

on any consecutive 24-month period for 

which there is inadequate information 

for determining annual emissions, in 

tons per year, and for adjusting this 

amount if required by paragraphs 

(a)(1)(xxxv)(B)(2) and (3) of this section. 

(C) For a new emissions unit, the 

baseline actual emissions for purposes 

of determining the emissions increase 

that will result from the initial 

construction and operation of such unit 

shall equal zero; and thereafter, for all 

other purposes, shall equal the unit’s 

potential to emit. 

(D) For a PAL for a major stationary 

source, the baseline actual emissions 

shall be calculated for existing electric 

utility steam generating units in 

accordance with the procedures 

contained in paragraph (a)(1)(xxxv)(A) 

of this section, for other existing 

emissions units in accordance with the 

procedures contained in paragraph 

(a)(1)(xxxv)(B) of this section, and for a 

new emissions unit in accordance with 

the procedures contained in paragraph 

(a)(1)(xxxv)(C) of this section. 

(xxxvi) [Reserved] 

(xxxvii) Regulated NSR pollutant, for 

purposes of this section, means the 

following: 

(A) Nitrogen oxides or any volatile 

organic compounds; 

(B) Any pollutant for which a national 

ambient air quality standard has been 

promulgated; 

(C) Any pollutant that is identified 

under this paragraph (a)(1)(xxxvii)(C) as 

a constituent or precursor of a general 

pollutant listed under paragraph 

(a)(1)(xxxvii)(A) or (B) of this section, 

provided that such constituent or 

precursor pollutant may only be 

regulated under NSR as part of 

regulation of the general pollutant. 

Precursors identified by the 

Administrator for purposes of NSR are 

the following: 

(1) Volatile organic compounds and 

nitrogen oxides are precursors to ozone 

in all ozone nonattainment areas. 

(2) Sulfur dioxide, Nitrogen oxides, 

Volatile organic compounds and 

Ammonia are precursors to PM2.5 in any 

PM2.5 nonattainment area. 

(D) PM2.5 emissions and PM10

emissions shall include gaseous 

emissions from a source or activity 

which condense to form particulate 

matter at ambient temperatures. On or 

after January 1, 2011 (or any earlier date 

established in the upcoming rulemaking 

codifying test methods), such 

condensable particulate matter shall be 

accounted for in applicability 

determinations and in establishing 

emissions limitations for PM2.5 and 

PM10 in nonattainment major NSR 

permits. Compliance with emissions 

limitations for PM2.5 and PM10 issued 

prior to this date shall not be based on 

condensable particulate matter unless 

required by the terms and conditions of 

the permit or the applicable 

implementation plan. Applicability 

determinations made prior to this date 

without accounting for condensable 

particulate matter shall not be 

considered in violation of this section 

unless the applicable implementation 

plan required condensable particulate 

matter to be included. 

(xxxviii) Reviewing authority means 

the State air pollution control agency, 

local agency, other State agency, Indian 

tribe, or other agency authorized by the 

Administrator to carry out a permit 

program under this section and 

§ 51.166, or the Administrator in the 

case of EPA-implemented permit 

programs under § 52.21. (xxxix) Project 

means a discrete physical change in, or 

change in the method of operation of, an 

existing major stationary source, or a 

discrete group of such changes 

(occurring contemporaneously at the 

same major stationary source) that are 

substantially related to each other. Such 

changes are substantially related if they 

are dependent on each other to be 


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economically or technically viable. In 

an extreme ozone nonattainment area, a 

‘‘project’’ means each discrete 

operation, emissions unit, or other 

pollutant-emitting activity. 

(xl) Best available control technology 

(BACT) means an emissions limitation 

(including a visible emissions standard) 

based on the maximum degree of 

reduction for each regulated NSR 

pollutant which would be emitted from 

any proposed major stationary source or 

major modification which the reviewing 

authority, on a case-by-case basis, taking 

into account energy, environmental, and 

economic impacts and other costs, 

determines is achievable for such source 

or modification through application of 

production processes or available 

methods, systems, and techniques, 

including fuel cleaning or treatment or 

innovative fuel combustion techniques 

for control of such pollutant. In no event 

shall application of best available 

control technology result in emissions 

of any pollutant which would exceed 

the emissions allowed by any applicable 

standard under 40 CFR part 60, 61, or 

63. If the reviewing authority 

determines that technological or 

economic limitations on the application 

of measurement methodology to a 

particular emissions unit would make 

the imposition of an emissions standard 

infeasible, a design, equipment, work 

practice, operational standard, or 

combination thereof, may be prescribed 

instead to satisfy the requirement for the 

application of BACT. Such standard 

shall, to the degree possible, set forth 

the emissions reduction achievable by 

implementation of such design, 

equipment, work practice or operation, 

and shall provide for compliance by 

means which achieve equivalent results. 

(xli) Prevention of Significant 

Deterioration (PSD) permit means any 

permit that is issued under a major 

source preconstruction permit program 

that has been approved by the 

Administrator and incorporated into the 

plan to implement the requirements of 

§ 51.166 of this chapter, or under the 

program in § 52.21 of this chapter. 

(xlii) Federal Land Manager means, 

with respect to any lands in the United 

States, the Secretary of the department 

with authority over such lands. 

(2) Applicability procedures. (i) Each 

plan shall adopt a preconstruction 

review program to satisfy the 

requirements of sections 172(c)(5) and 

173 of the Act for any area designated 

nonattainment for any national ambient 

air quality standard under subpart C of 

40 CFR part 81. Such a program shall 

apply to any new major stationary 

source or major modification that is 

major for the pollutant for which the 

area is designated nonattainment under 

section 107(d)(1)(A)(i) of the Act, if the 

stationary source or modification would 

locate anywhere in the designated 

nonattainment area. Different 

pollutants, including individual 

precursors, are not summed to 

determine applicability of a major 

stationary source or major modification. 

(ii) Each plan shall use the specific 

provisions of paragraphs (a)(2)(ii)(A) 

through (G) of this section. Deviations 

from these provisions will be approved 

only if the State specifically 

demonstrates that the submitted 

provisions are more stringent than or at 

least as stringent in all respects as the 

corresponding provisions in paragraphs 

(a)(2)(ii)(A) through (G) of this section. 

(A) Except as otherwise provided in 

paragraph (a)(2)(iii) of this section, and 

consistent with the definition of major 

modification contained in paragraph 

(a)(1)(v)(A) of this section, a project is a 

major modification for a regulated NSR 

pollutant (as defined in paragraph 

(a)(1)(xxxvii) of this section) if it causes 

two types of emissions increases—a 

significant emissions increase (as 

defined in paragraph (a)(1)(xxvii) of this 

section) and a significant net emissions 

increase (as defined in paragraphs 

(a)(1)(vi) and (x) of this section). The 

project is not a major modification if it 

does not cause a significant emissions 

increase. If the project causes a 

significant emissions increase, then the 

project is a major modification only if it 

also results in a significant net 

emissions increase. (B) The procedure 

for calculating (before beginning actual 

construction) whether a significant 

emissions increase (i.e., the first step of 

the process) will occur depends upon 

the type(s) of emissions units that could 

be affected by the project, according to 

paragraphs (a)(2)(ii)(C) through (G) of 

this section. The procedure for 

calculating (before beginning actual 

construction) whether a significant net 

emissions increase will occur at the 

major stationary source (i.e., the second 

step of the process) is contained in the 

definition in paragraph (a)(1)(vi) of this 

section. Regardless of any such 

preconstruction projections, a major 

modification results if the project causes 

a significant emissions increase and a 

significant net emissions increase. 

(C) Actual-to-projected-actual 

applicability test for projects that only 

involve existing emissions units. A 

significant emissions increase of a 

regulated NSR pollutant is projected to 

occur if the sum of the difference 

between the projected actual emissions 

(as defined in paragraph (a)(1)(xxviii) of 

this section) and the baseline actual 

emissions (as defined in paragraphs 

(a)(1)(xxxv)(A) and (B) of this section, as 

applicable), for each existing emissions 

unit, equals or exceeds the significant 

amount for that pollutant (as defined in 

paragraph (a)(1)(x) of this section). 

(D) Actual-to-potential test for 

projects that only involve construction 

of a new emissions unit(s). A significant 

emissions increase of a regulated NSR 

pollutant is projected to occur if the 

sum of the difference between the 

potential to emit (as defined in 

paragraph (a)(1)(iii) of this section) from 

each new emissions unit following 

completion of the project and the 

baseline actual emissions (as defined in 

paragraph (a)(1)(xxxv)(C) of this section) 

of these units before the project equals 

or exceeds the significant amount for 

that pollutant (as defined in paragraph 

(a)(1)(x) of this section). 

(E) [Reserved] 

(F) Hybrid test for projects that 

involve multiple types of emissions 

units. A significant emissions increase 

of a regulated NSR pollutant is projected 

to occur if the sum of the difference for 

all emissions units, using the method 

specified in paragraphs (a)(2)(ii)(C) 

through (D) of this section as applicable 

with respect to each emissions unit, 

equals or exceeds the significant amount 

for that pollutant (as defined in 

paragraph (a)(1)(x) of this section). 

(G) The ‘‘sum of the difference’’ as 

used in paragraphs (a)(2)(ii)(C), (D) and 

(F) of this section shall include both 

increases and decreases in emissions 

calculated in accordance with those 

paragraphs. A decrease may only be 

accounted for in the significant 

emissions increase determination if it 

meets the requirements under 40 CFR 

51.165(a)(1)(vi)(E)(2). 

(iii) The plan shall require that for any 

major stationary source with a PAL for 

a regulated NSR pollutant, the major 

stationary source shall comply with 

requirements under paragraph (f) of this 

section. 

* * * * * 

(6) Each plan shall provide that, 

except as otherwise provided in 

paragraph (a)(6)(vi) of this section, the 

following specific provisions apply with 

respect to any regulated NSR pollutant 

emitted from projects that involve one 

or more existing emissions units at a 

major stationary source (other than 

projects at a source with a PAL) in 

circumstances where there is a 

reasonable possibility, within the 

meaning of paragraph (a)(6)(vi) of this 

section, that a project that is not a part 

of a major modification may result in a 

significant emissions increase of such 

pollutant, and the owner or operator 

elects to use the method specified in 


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paragraphs (a)(1)(xxviii)(B)(1) through 

(3) of this section for calculating 

projected actual emissions from any 

existing emissions unit. Deviations from 

these provisions will be approved only 

if the State specifically demonstrates 

that the submitted provisions are more 

stringent than or at least as stringent in 

all respects as the corresponding 

provisions in paragraphs (a)(6)(i) 

through (vi) of this section. 

(i) Before beginning actual 

construction of the project, the owner or 

operator shall document and maintain a 

record of the following information: 

(A) A description of the project that 

includes: the name of the project, the 

project’s intended objective(s), each 

physical change and/or change in the 

method of operation associated with the 

project objective(s), and estimated 

timeline for the project, including an 

estimation of when the project would 

begin actual construction and begin 

regular operation; 

(B) Identification of the emissions 

unit(s) whose emissions of a regulated 

NSR pollutant could be affected by the 

project; and (C) A description of the 

applicability test used to determine that 

the project is not a major modification 

for any regulated NSR pollutant, 

including the baseline actual emissions, 

the projected actual emissions, the 

amount of emissions excluded under 

paragraph (a)(1)(xxviii)(B)(3) of this 

section and an explanation for why such 

amount was excluded, the potential to 

emit, as applicable, and any netting 

calculations, if applicable. 

(ii) Before beginning actual 

construction, the owner or operator 

shall provide a copy of the information 

set out in paragraph (a)(6)(i) of this 

section to the reviewing authority. 

Nothing in this paragraph (a)(6)(ii) shall 

be construed to require the owner or 

operator of such a unit to obtain any 

determination from the reviewing 

authority before beginning actual 

construction. 

(iii) The owner or operator shall 

monitor the emissions of any regulated 

NSR pollutant that could increase as a 

result of the project and that is emitted 

by any emissions units identified in 

paragraph (a)(6)(i)(B) of this section; and 

calculate and maintain a record of the 

annual emissions, in tons per year on a 

calendar year basis, for a period of 5 

years following resumption of regular 

operations after the change, or for a 

period of 10 years following resumption 

of regular operations after the change if 

the project increases the design capacity 

or potential to emit of that regulated 

NSR pollutant at any existing emissions 

unit identified in 40 CFR 

51.165(a)(6)(i)(B). 

(iv) If the project involves an existing 

electric utility steam generating unit, the 

owner or operator shall submit a report 

to the reviewing authority within 60 

days after the end of each year during 

which records must be generated under 

paragraph (a)(6)(iii) of this section 

setting out the annual emissions from 

each affected emissions unit during the 

calendar year that preceded submission 

of the report. 

(v) If the project does not involve an 

existing electric utility steam generating 

unit, the owner or operator shall submit 

a report to the reviewing authority if the 

annual emissions, in tons per year, from 

the project identified in paragraph 

(a)(6)(i) of this section, exceed the 

baseline actual emissions (as 

documented and maintained pursuant 

to paragraph (a)(6)(i)(C) of this section, 

by a significant amount (as defined in 

paragraph (a)(1)(x) of this section) for 

that regulated NSR pollutant, and if 

such emissions differ from the 

preconstruction projection as 

documented and maintained pursuant 

to paragraph (a)(6)(i)(C) of this section. 

Such report shall be submitted to the 

reviewing authority within 60 days after 

the end of such year. The report shall 

contain the following: 

(A) The name, address and telephone 

number of the major stationary source; 

(B) The annual emissions as 

calculated pursuant to paragraph 

(a)(6)(iii) of this section; and 

(C) Any other information that the 

owner or operator wishes to include in 

the report (e.g., an explanation as to 

why the emissions differ from the 

preconstruction projection). 

(vi) A ‘‘reasonable possibility’’ under 

paragraph (a)(6) of this section occurs 

when the owner or operator calculates 

the project to result in either: 

(A) A projected actual emissions 

increase of at least 50 percent of the 

amount that is a ‘‘significant emissions 

increase,’’ as defined under paragraph 

(a)(1)(xxvii) of this section (without 

reference to the amount that is a 

significant net emissions increase), for 

the regulated NSR pollutant; or 

(B) A projected actual emissions 

increase that, added to the amount of 

emissions excluded under paragraph 

(a)(1)(xxviii)(B)(3), sums to at least 50 

percent of the amount that is a 

‘‘significant emissions increase,’’ as 

defined under paragraph (a)(1)(xxvii) of 

this section (without reference to the 

amount that is a significant net 

emissions increase), for the regulated 

NSR pollutant. For a project for which 

a reasonable possibility occurs only 

within the meaning of paragraph 

(a)(6)(vi)(B) of this section, and not also 

within the meaning of paragraph 

(a)(6)(vi)(A) of this section, then 

provisions (a)(6)(ii) through (v) do not 

apply to the project; or 

(C) The owner or operator accounts 

for a decrease in emissions from one or 

more emissions unit(s) in determining 

that the project is not a major 

modification for a regulated NSR 

pollutant regardless of the projected 

actual emissions increase. 

* * * * * 

■ 3. Amend § 51.166 by: 

■ a. Revising and republishing 

paragraph (a)(7); 

■ b. Revising paragraph (b)(51); and 

■ c. Revising and republishing 

paragraph (r)(6). 

The revisions and republications read 

as follows: 

§ 51.166 Prevention of significant 

deterioration of air quality. 

(a) * * * 

(7) Applicability. Each plan shall 

contain procedures that incorporate the 

requirements in paragraphs (a)(7)(i) 

through (v) of this section. 

(i) The requirements of this section 

apply to the construction of any new 

major stationary source (as defined in 

paragraph (b)(1) of this section) or any 

project at an existing major stationary 

source in an area designated as 

attainment or unclassifiable under 

sections 107(d)(1)(A)(ii) or (iii) of the 

Act. 

(ii) The requirements of paragraphs (j) 

through (r) of this section apply to the 

construction of any new major 

stationary source or the major 

modification of any existing major 

stationary source, except as this section 

otherwise provides. 

(iii) No new major stationary source 

or major modification to which the 

requirements of paragraphs (j) through 

(r)(5) of this section apply shall begin 

actual construction without a permit 

that states that the major stationary 

source or major modification will meet 

those requirements. 

(iv) Each plan shall use the specific 

provisions of paragraphs (a)(7)(iv)(a) 

through (g) of this section. Deviations 

from these provisions will be approved 

only if the State specifically 

demonstrates that the submitted 

provisions are more stringent than or at 

least as stringent in all respects as the 

corresponding provisions in paragraphs 

(a)(7)(iv)(a) through (g) of this section. 

(a) Except as otherwise provided in 

paragraph (a)(7)(v) of this section, and 

consistent with the definition of major 

modification contained in paragraph 

(b)(2) of this section, a project is a major 

modification for a regulated NSR 

pollutant if it causes two types of 

emissions increases—a significant 


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emissions increase (as defined in 

paragraph (b)(39) of this section), and a 

significant net emissions increase (as 

defined in paragraphs (b)(3) and (23) of 

this section). The project is not a major 

modification if it does not cause a 

significant emissions increase. If the 

project causes a significant emissions 

increase, then the project is a major 

modification only if it also results in a 

significant net emissions increase. (b) 

The procedure for calculating (before 

beginning actual construction) whether 

a significant emissions increase (i.e., the 

first step of the process) will occur 

depends upon the type(s) of emissions 

units that could be affected by a project, 

according to paragraphs (a)(7)(iv)(c) 

through (g) of this section. The 

procedure for calculating (before 

beginning actual construction) whether 

a significant net emissions increase will 

occur at the major stationary source (i.e., 

the second step of the process) is 

contained in the definition in paragraph 

(b)(3) of this section. Regardless of any 

such preconstruction projections, a 

major modification results if the project 

causes a significant emissions increase 

and a significant net emissions increase. 

(c) Actual-to-projected-actual 

applicability test for projects that only 

involve existing emissions units. A 

significant emissions increase of a 

regulated NSR pollutant is projected to 

occur if the sum of the difference 

between the projected actual emissions 

(as defined in paragraph (b)(40) of this 

section) and the baseline actual 

emissions (as defined in paragraphs 

(b)(47)(i) and (ii) of this section) for each 

existing emissions unit, equals or 

exceeds the significant amount for that 

pollutant (as defined in paragraph 

(b)(23) of this section). 

(d) Actual-to-potential test for projects 

that only involve construction of a new 

emissions unit(s). A significant 

emissions increase of a regulated NSR 

pollutant is projected to occur if the 

sum of the difference between the 

potential to emit (as defined in 

paragraph (b)(4) of this section) from 

each new emissions unit following 

completion of the project and the 

baseline actual emissions (as defined in 

paragraph (b)(47)(iii) of this section) of 

these units before the project equals or 

exceeds the significant amount for that 

pollutant (as defined in paragraph 

(b)(23) of this section). 

(e) [Reserved] 

(f) Hybrid test for projects that involve 

multiple types of emissions units. A 

significant emissions increase of a 

regulated NSR pollutant is projected to 

occur if the sum of the difference for all 

emissions units, using the method 

specified in paragraphs (a)(7)(iv)(c) 

through (d) of this section as applicable 

with respect to each emissions unit, 

equals or exceeds the significant amount 

for that pollutant (as defined in 

paragraph (b)(23) of this section). 

(g) The ‘‘sum of the difference’’ as 

used in paragraphs (a)(7)(iv)(c), (d) and 

(f) of this section shall include both 

increases and decreases in emissions 

calculated in accordance with those 

paragraphs. A decrease may only be 

accounted for in the significant 

emissions increase determination if it 

meets the requirements under 40 CFR 

51.166(b)(3)(vi)(b). 

(v) The plan shall require that for any 

major stationary source with a PAL for 

a regulated NSR pollutant, the major 

stationary source shall comply with 

requirements under paragraph (w) of 

this section. 

(b) * * * (51) Project means a discrete 

physical change in, or change in the 

method of operation of, an existing 

major stationary source, or a discrete 

group of such changes (occurring 

contemporaneously at the same major 

stationary source) that are substantially 

related to each other. Such changes are 

substantially related if they are 

dependent on each other to be 

economically or technically viable. 

* * * * * 

(r) * * * 

(6) Each plan shall provide that, 

except as otherwise provided in 

paragraph (r)(6)(vi) of this section, the 

following specific provisions apply with 

respect to any regulated NSR pollutant 

emitted from projects that involve one 

or more existing emissions units at a 

major stationary source (other than 

projects at a source with a PAL) in 

circumstances where there is a 

reasonable possibility, within the 

meaning of paragraph (r)(6)(vi) of this 

section, that a project that is not a part 

of a major modification may result in a 

significant emissions increase of such 

pollutant, and the owner or operator 

elects to use the method specified in 

paragraphs (b)(40)(ii)(a) through (c) of 

this section for calculating projected 

actual emissions from any existing 

emissions unit. Deviations from these 

provisions will be approved only if the 

State specifically demonstrates that the 

submitted provisions are more stringent 

than or at least as stringent in all 

respects as the corresponding provisions 

in paragraphs (r)(6)(i) through (vi) of 

this section. 

(i) Before beginning actual 

construction of the project, the owner or 

operator shall document and maintain a 

record of the following information: (a) 

A description of the project that 

includes: the name of the project, the 

project’s intended objective(s), each 

physical change and/or change in the 

method of operation associated with the 

project objective(s), and estimated 

timeline for the project, including an 

estimation of when the project would 

begin actual construction and begin 

regular operation; 

(b) Identification of the emissions 

unit(s) whose emissions of a regulated 

NSR pollutant could be affected by the 

project; and 

(c) A description of the applicability 

test used to determine that the project 

is not a major modification for any 

regulated NSR pollutant, including the 

baseline actual emissions, the projected 

actual emissions, the amount of 

emissions excluded under paragraph 

(b)(40)(ii)(c) of this section and an 

explanation for why such amount was 

excluded, the potential to emit, as 

applicable, and any netting calculations, 

if applicable. 

(ii) Before beginning actual 

construction, the owner or operator 

shall provide a copy of the information 

set out in paragraph (r)(6)(i) of this 

section to the reviewing authority. 

Nothing in this paragraph (r)(6)(ii) shall 

be construed to require the owner or 

operator of such a unit to obtain any 

determination from the reviewing 

authority before beginning actual 

construction. 

(iii) The owner or operator shall 

monitor the emissions of any regulated 

NSR pollutant that could increase as a 

result of the project and that is emitted 

by any emissions unit identified in 

paragraph (r)(6)(i)(B) of this section; and 

calculate and maintain a record of the 

annual emissions, in tons per year on a 

calendar year basis, for a period of 5 

years following resumption of regular 

operations after the change, or for a 

period of 10 years following resumption 

of regular operations after the change if 

the project increases the design capacity 

or potential to emit of that regulated 

NSR pollutant at any existing emissions 

unit identified in 40 CFR 

51.166(r)(6)(i)(b). (iv) If the project 

involves an existing electric utility 

steam generating unit, the owner or 

operator shall submit a report to the 

reviewing authority within 60 days after 

the end of each year during which 

records must be generated under 

paragraph (r)(6)(iii) of this section 

setting out the annual emissions from 

each affected emissions unit during the 

calendar year that preceded submission 

of the report. 

(v) If the project does not involve an 

existing electric utility steam generating 

unit, the owner or operator shall submit 

a report to the reviewing authority if the 

annual emissions, in tons per year, from 


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the project identified in paragraph 

(r)(6)(i) of this section, exceed the 

baseline actual emissions (as 

documented and maintained pursuant 

to paragraph (r)(6)(i)(c) of this section) 

by a significant amount (as defined in 

paragraph (b)(23) of this section) for that 

regulated NSR pollutant, and if such 

emissions differ from the 

preconstruction projection as 

documented and maintained pursuant 

to paragraph (r)(6)(i)(c) of this section. 

Such report shall be submitted to the 

reviewing authority within 60 days after 

the end of such year. The report shall 

contain the following: 

(a) The name, address and telephone 

number of the major stationary source; 

(b) The annual emissions as 

calculated pursuant to paragraph 

(r)(6)(iii) of this section; and 

(c) Any other information that the 

owner or operator wishes to include in 

the report (e.g., an explanation as to 

why the emissions differ from the 

preconstruction projection). 

(vi) A ‘‘reasonable possibility’’ under 

paragraph (r)(6) of this section occurs 

when the owner or operator calculates 

the project to result in either: 

(a) A projected actual emissions 

increase of at least 50 percent of the 

amount that is a ‘‘significant emissions 

increase,’’ as defined under paragraph 

(b)(39) of this section (without reference 

to the amount that is a significant net 

emissions increase), for the regulated 

NSR pollutant; or 

(b) A projected actual emissions 

increase that, added to the amount of 

emissions excluded under paragraph 

(b)(40)(ii)(c) of this section, sums to at 

least 50 percent of the amount that is a 

‘‘significant emissions increase,’’ as 

defined under paragraph (b)(39) of this 

section (without reference to the amount 

that is a significant net emissions 

increase), for the regulated NSR 

pollutant. For a project for which a 

reasonable possibility occurs only 

within the meaning of paragraph 

(r)(6)(vi)(b) of this section, and not also 

within the meaning of paragraph 

(r)(6)(vi)(a) of this section, then the 

provisions under paragraphs (r)(6)(ii) 

through (v) of this section do not apply 

to the project; or 

(c) The owner or operator accounts for 

a decrease in emissions from one or 

more emissions unit(s) in determining 

that the project is not a major 

modification for a regulated NSR 

pollutant regardless of the projected 

actual emissions increase. 

* * * * * 

Appendix S to Part 51—Emission Offset 

Interpretative Ruling 

■ 4. Amend appendix S to part 51 by 

revising and republishing paragraphs 

II.A, IV.I, and IV.J to read as follows: 

Appendix S to Part 51—Emission Offset 

Interpretative Ruling 

* * * * * 

II. Initial Screening Analyses and 

Determination of Applicable Requirements 

A. Definitions—For the purposes of this 

Ruling: 

1. Stationary source means any building, 

structure, facility, or installation which emits 

or may emit a regulated NSR pollutant. 

2. (i) Building, structure, facility or 

installation means all of the pollutantemitting activities which belong to the same 

industrial grouping, are located on one or 

more contiguous or adjacent properties, and 

are under the control of the same person (or 

persons under common control) except the 

activities of any vessel. Pollutant-emitting 

activities shall be considered as part of the 

same industrial grouping if they belong to the 

same ‘‘Major Group’’ (i.e., which have the 

same two digit code) as described in the 

Standard Industrial Classification Manual, 

1972, as amended by the 1977 Supplement 

(U.S. Government Printing Office stock 

numbers 4101–0066 and 003–005–00176–0, 

respectively). 

(ii) Notwithstanding the provisions of 

paragraph II.A.2(i) of this section, building, 

structure, facility or installation means, for 

onshore activities under SIC Major Group 13: 

Oil and Gas Extraction, all of the pollutantemitting activities included in Major Group 

13 that are located on one or more contiguous 

or adjacent properties, and are under the 

control of the same person (or persons under 

common control). Pollutant emitting 

activities shall be considered adjacent if they 

are located on the same surface site; or if they 

are located on surface sites that are located 

within 1/4 mile of one another (measured 

from the center of the equipment on the 

surface site) and they share equipment. 

Shared equipment includes, but is not 

limited to, produced fluids storage tanks, 

phase separators, natural gas dehydrators or 

emissions control devices. Surface site, as 

used in this paragraph II.A.2(ii), has the same 

meaning as in 40 CFR 63.761. 

3. Potential to emit means the maximum 

capacity of a stationary source to emit a 

pollutant under its physical and operational 

design. Any physical or operational 

limitation on the capacity of the source to 

emit a pollutant, including air pollution 

control equipment and restrictions on hours 

of operation or on the type or amount of 

material combusted, stored, or processed, 

shall be treated as part of its design only if 

the limitation or the effect it would have on 

emissions is federally enforceable. Secondary 

emissions do not count in determining the 

potential to emit of a stationary source. 

4. (i) Major stationary source means: 

(a) Any stationary source of air pollutants 

which emits, or has the potential to emit, 100 

tons per year or more of a regulated NSR 

pollutant (as defined in paragraph II.A.31 of 

this Ruling), except that lower emissions 

thresholds shall apply in areas subject to 

subpart 2, subpart 3, or subpart 4 of part D, 

title I of the Act, according to paragraphs 

II.A.4(i)(a)(1) through (8) of this Ruling. 

(1) 50 tons per year of volatile organic 

compounds in any serious ozone 

nonattainment area. 

(2) 50 tons per year of volatile organic 

compounds in an area within an ozone 

transport region, except for any severe or 

extreme ozone nonattainment area. 

(3) 25 tons per year of volatile organic 

compounds in any severe ozone 

nonattainment area. 

(4) 10 tons per year of volatile organic 

compounds in any extreme ozone 

nonattainment area. 

(5) 50 tons per year of carbon monoxide in 

any serious nonattainment area for carbon 

monoxide, where stationary sources 

contribute significantly to carbon monoxide 

levels in the area (as determined under rules 

issued by the Administrator). 

(6) 70 tons per year of PM–10 in any 

serious nonattainment area for PM10.

(7) 70 tons per year of PM2.5 in any serious 

nonattainment area for PM2.5.

(8) 70 tons per year of any individual PM2.5

precursor (as defined in paragraph II.A.31 of 

this Ruling) in any Serious nonattainment 

area for PM2.5.

(b) For the purposes of applying the 

requirements of paragraph IV. H of this 

Ruling to stationary sources of nitrogen 

oxides located in an ozone nonattainment 

area or in an ozone transport region, any 

stationary source which emits, or has the 

potential to emit, 100 tons per year or more 

of nitrogen oxides emissions, except that the 

emission thresholds in paragraphs 

II.A.4(i)(b)(1) through (6) of this Ruling apply 

in areas subject to subpart 2 of part D, title 

I of the Act. 

(1) 100 tons per year or more of nitrogen 

oxides in any ozone nonattainment area 

classified as marginal or moderate. 

(2) 100 tons per year or more of nitrogen 

oxides in any ozone nonattainment area 

classified as a transitional, submarginal, or 

incomplete or no data area, when such area 

is located in an ozone transport region. 

(3) 100 tons per year or more of nitrogen 

oxides in any area designated under section 

107(d) of the Act as attainment or 

unclassifiable for ozone that is located in an 

ozone transport region. 

(4) 50 tons per year or more of nitrogen 

oxides in any serious nonattainment area for 

ozone. 

(5) 25 tons per year or more of nitrogen 

oxides in any severe nonattainment area for 

ozone. 

(6) 10 tons per year or more of nitrogen 

oxides in any extreme nonattainment area for 

ozone; or 

(c) Any physical change that would occur 

at a stationary source not qualifying under 

paragraph II.A.4(i)(a) or (b) of this Ruling as 

a major stationary source, if the change 

would constitute a major stationary source by 

itself. 

(ii) A major stationary source that is major 

for volatile organic compounds or nitrogen 

oxides is major for ozone. 

(iii) The fugitive emissions of a stationary 

source shall not be included in determining 


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for any of the purposes of this Ruling 

whether it is a major stationary source, 

unless the source belongs to one of the 

following categories of stationary sources: 

(a) Coal cleaning plants (with thermal 

dryers); 

(b) Kraft pulp mills; 

(c) Portland cement plants; 

(d) Primary zinc smelters; 

(e) Iron and steel mills; 

(f) Primary aluminum ore reduction plants; 

(g) Primary copper smelters; 

(h) Municipal incinerators capable of 

charging more than 50 tons of refuse per day; 

(i) Hydrofluoric, sulfuric, or nitric acid 

plants; 

(j) Petroleum refineries; 

(k) Lime plants; 

(l) Phosphate rock processing plants; 

(m) Coke oven batteries; 

(n) Sulfur recovery plants; 

(o) Carbon black plants (furnace process); 

(p) Primary lead smelters; 

(q) Fuel conversion plants; 

(r) Sintering plants; 

(s) Secondary metal production plants; 

(t) Chemical process plants—The term 

chemical processing plant shall not include 

ethanol production facilities that produce 

ethanol by natural fermentation included in 

NAICS codes 325193 or 312140; 

(u) Fossil-fuel boilers (or combination 

thereof) totaling more than 250 million 

British thermal units per hour heat input; 

(v) Petroleum storage and transfer units 

with a total storage capacity exceeding 

300,000 barrels; 

(w) Taconite ore processing plants; 

(x) Glass fiber processing plants; 

(y) Charcoal production plants; 

(z) Fossil fuel-fired steam electric plants of 

more than 250 million British thermal units 

per hour heat input; 

(aa) Any other stationary source category 

which, as of August 7, 1980, is being 

regulated under section 111 or 112 of the Act. 

5. (i) Major modification means any 

physical change in or change in the method 

of operation of a major stationary source that 

would result in: 

(a) A significant emissions increase of a 

regulated NSR pollutant (as defined in 

paragraph II.A.31 of this Ruling); and 

(b) A significant net emissions increase of 

that pollutant from the major stationary 

source. 

(ii) Any significant emissions increase (as 

defined in paragraph II.A.23 of this Ruling) 

from any emissions units or net emissions 

increase (as defined in paragraph II.A.6 of 

this Ruling) at a major stationary source that 

is significant for volatile organic compounds 

shall be considered significant for ozone. 

(iii) A physical change or change in the 

method of operation shall not include: 

(a) Routine maintenance, repair, and 

replacement; 

(b) Use of an alternative fuel or raw 

material by reason of an order under section 

2 (a) and (b) of the Energy Supply and 

Environmental Coordination Act of 1974 (or 

any superseding legislation) or by reason of 

a natural gas curtailment plan pursuant to the 

Federal Power Act; 

(c) Use of an alternative fuel by reason of 

an order or rule under section 125 of the Act; 

(d) Use of an alternative fuel at a steam 

generating unit to the extent that the fuel is 

generated from municipal solid waste; 

(e) Use of an alternative fuel or raw 

material by a stationary source which: 

(1) The source was capable of 

accommodating before December 21, 1976, 

unless such change would be prohibited 

under any federally enforceable permit 

condition which was established after 

December 21, 1976, pursuant to 40 CFR 52.21 

or under regulations approved pursuant to 40 

CFR part 51, subpart I; or 

(2) The source is approved to use under 

any permit issued under this Ruling; 

(f) An increase in the hours of operation or 

in the production rate, unless such change is 

prohibited under any federally enforceable 

permit condition which was established after 

December 21, 1976, pursuant to 40 CFR 52.21 

or under regulations approved pursuant to 40 

CFR part 51, subpart I; 

(g) Any change in ownership at a stationary 

source. 

(iv) For the purpose of applying the 

requirements of paragraph IV.H of this Ruling 

to modifications at major stationary sources 

of nitrogen oxides located in ozone 

nonattainment areas or in ozone transport 

regions, whether or not subject with respect 

to ozone to subpart 2, part D, title I of the 

Act, any significant net emissions increase of 

nitrogen oxides is considered significant for 

ozone. (v) Any physical change in, or change 

in the method of operation of, a major 

stationary source of volatile organic 

compounds that results in any increase in 

emissions of volatile organic compounds 

from any discrete operation, emissions unit, 

or other pollutant emitting activity at the 

source shall be considered a significant net 

emissions increase and a major modification 

for ozone, if the major stationary source is 

located in an extreme ozone nonattainment 

area. A reduction in emissions of volatile 

organic compounds may not be used to 

determine if a modification will result in a 

major modification. 

(vi) This definition shall not apply with 

respect to a particular regulated NSR 

pollutant when the major stationary source is 

complying with the requirements under 

paragraph IV.K of this ruling for a PAL for 

that pollutant. Instead, the definition at 

paragraph IV.K.2(viii) of this Ruling shall 

apply. 

(vii) Fugitive emissions shall not be 

included in determining for any of the 

purposes of this Ruling whether a physical 

change in or change in the method of 

operation of a major stationary source is a 

major modification, unless the source 

belongs to one of the source categories listed 

in paragraph II.A.4(iii) of this Ruling. 

6. (i) Net emissions increase means, with 

respect to any regulated NSR pollutant 

emitted by a major stationary source, the 

amount by which the sum of the following 

exceeds zero: 

(a) The increase in emissions from a 

particular physical change or change in the 

method of operation at a stationary source as 

calculated pursuant to paragraph IV.J of this 

Ruling; and 

(b) Any other increases and decreases in 

actual emissions at the major stationary 

source that are contemporaneous with the 

particular change and are otherwise 

creditable. Baseline actual emissions for 

calculating increases and decreases under 

this paragraph II.A.6(i)(b) shall be 

determined as provided in paragraph II.A.30 

of this Ruling, except that paragraphs 

II.A.30(i)(c) and II.A.30(ii)(d) of this Ruling 

shall not apply. 

(ii) An increase or decrease in actual 

emissions is contemporaneous with the 

increase from the particular change only if it 

occurs between: 

(a) The date five years before construction 

on the particular change commences and 

(b) The date that the increase from the 

particular change occurs. 

(iii) An increase or decrease in actual 

emissions is creditable only if the reviewing 

authority has not relied on it in issuing a 

permit for the source under this Ruling, 

which permit is in effect when the increase 

in actual emissions from the particular 

change occurs. 

(iv) An increase in actual emissions is 

creditable only to the extent that the new 

level of actual emissions exceeds the old 

level. 

(v) A decrease in actual emissions is 

creditable only to the extent that: 

(a) The old level of actual emissions or the 

old level of allowable emissions, whichever 

is lower, exceeds the new level of actual 

emissions; 

(b) It is enforceable as a practical matter at 

and after the time that actual construction on 

the particular change begins; 

(c) The reviewing authority has not relied 

on it in issuing any permit under regulations 

approved pursuant to 40 CFR 51.165; and 

(d) It has approximately the same 

qualitative significance for public health and 

welfare as that attributed to the increase from 

the particular change. 

(vi) An increase that results from a 

physical change at a source occurs when the 

emissions unit on which construction 

occurred becomes operational and begins to 

emit a particular pollutant. Any replacement 

unit that requires shakedown becomes 

operational only after a reasonable 

shakedown period, not to exceed 180 days. 

(vii) Paragraph II.A.13(ii) of this Ruling 

shall not apply for determining creditable 

increases and decreases or after a change. 

7. Emissions unit means any part of a 

stationary source that emits or would have 

the potential to emit any regulated NSR 

pollutant and includes an electric utility 

steam generating unit as defined in paragraph 

II.A.21 of this Ruling. For purposes of this 

Ruling, there are two types of emissions units 

as described in paragraphs II.A.7(i) and (ii) of 

this Ruling. 

(i) A new emissions unit is any emissions 

unit which is (or will be) newly constructed 

and which has existed for less than 2 years 

from the date such emissions unit first 

operated. 

(ii) An existing emissions unit is any 

emissions unit that does not meet the 

requirements in paragraph II.A.7(i) of this 

Ruling. A replacement unit, as defined in 

paragraph II.A.37 of this Ruling, is an 

existing emissions unit. 

8. Secondary emissions means emissions 

which would occur as a result of the 


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construction or operation of a major 

stationary source or major modification, but 

do not come from the major stationary source 

or major modification itself. For the purpose 

of this Ruling, secondary emissions must be 

specific, well defined, quantifiable, and 

impact the same general area as the 

stationary source or modification which 

causes the secondary emissions. Secondary 

emissions include emissions from any offsite 

support facility which would not be 

constructed or increase its emissions except 

as a result of the construction or operation of 

the major stationary source or major 

modification. Secondary emissions do not 

include any emissions which come directly 

from a mobile source, such as emissions from 

the tailpipe of a motor vehicle, from a train, 

or from a vessel. 

9. Fugitive emissions means those 

emissions which could not reasonably pass 

through a stack, chimney, vent, or other 

functionally equivalent opening. 

10. (i) Significant means, in reference to a 

net emissions increase or the potential of a 

source to emit any of the following 

pollutants, a rate of emissions that would 

equal or exceed any of the following rates: 

Pollutant and Emissions Rate 

Carbon monoxide: 100 tons per year (tpy) 

Nitrogen oxides: 40 tpy 

Sulfur dioxide: 40 tpy 

Ozone: 40 tpy of Volatile organic 

compounds or Nitrogen oxides 

Lead: 0.6 tpy 

Particulate matter: 25 tpy of Particulate 

matter emissions 

PM10: 15 tpy 

PM2.5: 10 tpy of direct PM2.5 emissions; 40 

tpy of Sulfur dioxide emissions, 40 tpy 

of Nitrogen oxides emissions, or 40 tpy 

of Volatile organic compound emissions, 

to the extent that any such pollutant is 

defined as a precursor for PM2.5 in 

paragraph II.A.31 of this Ruling. 

(ii) Notwithstanding the significant 

emissions rate for ozone in paragraph 

II.A.10(i) of this Ruling, significant means, in 

reference to an emissions increase or a net 

emissions increase, any increase in actual 

emissions of volatile organic compounds that 

would result from any physical change in, or 

change in the method of operation of, a major 

stationary source locating in a serious or 

severe ozone nonattainment area, if such 

emissions increase of volatile organic 

compounds exceeds 25 tons per year when 

aggregated with all other net increases in 

emissions from the source over any period of 

5 consecutive calendar years which includes 

the calendar year in which such increase 

occurred. 

(iii) For the purposes of applying the 

requirements of paragraph IV.H of this Ruling 

to modifications at major stationary sources 

of nitrogen oxides located in an ozone 

nonattainment area or in an ozone transport 

region, the significant emission rates and 

other requirements for volatile organic 

compounds in paragraphs II.A.10(i), (ii), and 

(v) of this Ruling shall apply to nitrogen 

oxides emissions. 

(iv) Notwithstanding the significant 

emissions rate for carbon monoxide under 

paragraph II.A.10(i) of this Ruling, significant 

means, in reference to an emissions increase 

or a net emissions increase, any increase in 

actual emissions of carbon monoxide that 

would result from any physical change in, or 

change in the method of operation of, a major 

stationary source in a serious nonattainment 

area for carbon monoxide if such increase 

equals or exceeds 50 tons per year, provided 

the Administrator has determined that 

stationary sources contribute significantly to 

carbon monoxide levels in that area. 

(v) Notwithstanding the significant 

emissions rates for ozone under paragraphs 

II.A.10(i) and (ii) of this Ruling, any increase 

in actual emissions of volatile organic 

compounds from any emissions unit at a 

major stationary source of volatile organic 

compounds located in an extreme ozone 

nonattainment area shall be considered a 

significant net emissions increase. A 

reduction in emissions of volatile organic 

compounds from discrete operations, units, 

or activities within the source may not be 

used to determine if a modification will 

result in a major modification. 

(vi) In any nonattainment area for PM2.5 in 

which a state must regulate Ammonia as a 

regulated NSR pollutant (as a PM2.5

precursor) as defined in paragraph II.A.31 of 

this Ruling, the reviewing authority shall 

define ‘‘significant’’ for Ammonia for that 

area and establish a record to document its 

supporting basis. All sources with 

modification projects with increases in 

Ammonia emissions that are not subject to 

Section IV of this Ruling must maintain 

records of the non-applicability of Section IV 

that reference the definition of ‘‘significant’’ 

for Ammonia that is established by the 

reviewing authority in the nonattainment 

area where the source is located. 

11. Allowable emissions means the 

emissions rate calculated using the maximum 

rated capacity of the source (unless the 

source is subject to federally enforceable 

limits which restrict the operating rate, or 

hours of operation, or both) and the most 

stringent of the following: 

(i) Applicable standards as set forth in 40 

CFR parts 60 and 61; 

(ii) Any applicable State Implementation 

Plan emissions limitation, including those 

with a future compliance date; or 

(iii) The emissions rate specified as a 

federally enforceable permit condition, 

including those with a future compliance 

date. 

12. Federally enforceable means all 

limitations and conditions which are 

enforceable by the Administrator, including 

those requirements developed pursuant to 40 

CFR parts 60 and 61, requirements within 

any applicable State implementation plan, 

any permit requirements established 

pursuant to 40 CFR 52.21 or under 

regulations approved pursuant to 40 CFR part 

51, subpart I, including operating permits 

issued under an EPA-approved program that 

is incorporated into the State implementation 

plan and expressly requires adherence to any 

permit issued under such program. 

13. (i) Actual emissions means the actual 

rate of emissions of a regulated NSR 

pollutant from an emissions unit, as 

determined in accordance with paragraphs 

II.A.13(ii) through (iv) of this Ruling, except 

that this definition shall not apply for 

calculating whether a significant emissions 

increase has occurred, or for establishing a 

PAL under paragraph IV.K of this Ruling. 

Instead, paragraphs II.A.24 and 30 of this 

Ruling shall apply for those purposes. 

(ii) In general, actual emissions as of a 

particular date shall equal the average rate, 

in tons per year, at which the unit actually 

emitted the pollutant during a consecutive 

24-month period which precedes the 

particular date and which is representative of 

normal source operation. The reviewing 

authority shall allow the use of a different 

time period upon a determination that it is 

more representative of normal source 

operation. Actual emissions shall be 

calculated using the unit’s actual operating 

hours, production rates, and types of 

materials processed, stored, or combusted 

during the selected time period. 

(iii) The reviewing authority may presume 

that source-specific allowable emissions for 

the unit are equivalent to the actual 

emissions of the unit. 

(iv) For any emissions unit that has not 

begun normal operations on the particular 

date, actual emissions shall equal the 

potential to emit of the unit on that date. 

14. Construction means any physical 

change or change in the method of operation 

(including fabrication, erection, installation, 

demolition, or modification of an emissions 

unit) that would result in a change in 

emissions. 

15. Commence as applied to construction 

of a major stationary source or major 

modification means that the owner or 

operator has all necessary preconstruction 

approvals or permits and either has: 

(i) Begun, or caused to begin, a continuous 

program of actual on-site construction of the 

source, to be completed within a reasonable 

time; or 

(ii) Entered into binding agreements or 

contractual obligations, which cannot be 

cancelled or modified without substantial 

loss to the owner or operator, to undertake 

a program of actual construction of the 

source to be completed within a reasonable 

time. 

16. Necessary preconstruction approvals or 

permits means those permits or approvals 

required under Federal air quality control 

laws and regulations and those air quality 

control laws and regulations which are part 

of the applicable State Implementation Plan. 

17. Begin actual construction means, in 

general, initiation of physical on-site 

construction activities on an emissions unit 

which are of a permanent nature. Such 

activities include, but are not limited to, 

installation of building supports and 

foundations, laying of underground 

pipework, and construction of permanent 

storage structures. With respect to a change 

in method of operating this term refers to 

those on-site activities other than preparatory 

activities which mark the initiation of the 

change. 

18. Lowest achievable emission rate (LAER) 

means, for any source, the more stringent rate 

of emissions based on the following: 

(i) The most stringent emissions limitation 

which is contained in the implementation 

plan of any State for such class or category 

of stationary source, unless the owner or 


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operator of the proposed stationary source 

demonstrates that such limitations are not 

achievable; or 

(ii) The most stringent emissions limitation 

which is achieved in practice by such class 

or category of stationary source. This 

limitation, when applied to a modification, 

means the lowest achievable emissions rate 

for the new or modified emissions units 

within the stationary source. In no event 

shall the application of this term permit a 

proposed new or modified stationary source 

to emit any pollutant in excess of the amount 

allowable under applicable new source 

standards of performance. 

19. Resource recovery facility means any 

facility at which solid waste is processed for 

the purpose of extracting, converting to 

energy, or otherwise separating and 

preparing solid waste for reuse. Energy 

conversion facilities must utilize solid waste 

to provide more than 50 percent of the heat 

input to be considered a resource recovery 

facility under this Ruling. 

20. Volatile organic compounds (VOC) is 

as defined in § 51.100(s) of this part. 

21. Electric utility steam generating unit 

means any steam electric generating unit that 

is constructed for the purpose of supplying 

more than one-third of its potential electric 

output capacity and more than 25 MW 

electrical output to any utility power 

distribution system for sale. Any steam 

supplied to a steam distribution system for 

the purpose of providing steam to a steamelectric generator that would produce 

electrical energy for sale is also considered in 

determining the electrical energy output 

capacity of the affected facility. 

22. Pollution prevention means any activity 

that through process changes, product 

reformulation or redesign, or substitution of 

less polluting raw materials, eliminates or 

reduces the release of air pollutants 

(including fugitive emissions) and other 

pollutants to the environment prior to 

recycling, treatment, or disposal; it does not 

mean recycling (other than certain ‘‘inprocess recycling’’ practices), energy 

recovery, treatment, or disposal. 

23. Significant emissions increase means, 

for a regulated NSR pollutant, an increase in 

emissions that is significant (as defined in 

paragraph II.A.10 of this Ruling) for that 

pollutant. 

24. (i) Projected actual emissions means, 

the maximum annual rate, in tons per year, 

at which an existing emissions unit is 

projected to emit a regulated NSR pollutant 

in any one of the 5 years (12-month period) 

following the date the unit resumes regular 

operation after the project, or in any one of 

the 10 years following that date, if the project 

involves increasing the emissions unit’s 

design capacity or its potential to emit of that 

regulated NSR pollutant and full utilization 

of the unit would result in a significant 

emissions increase or a significant net 

emissions increase at the major stationary 

source. 

(ii) In determining the projected actual 

emissions under paragraph II.A.24(i) of this 

Ruling before beginning actual construction, 

the owner or operator of the major stationary 

source: 

(a) Shall consider all relevant information, 

including but not limited to, historical 

operational data, the company’s own 

representations, the company’s expected 

business activity and the company’s highest 

projections of business activity, the 

company’s filings with the State or Federal 

regulatory authorities, and compliance plans 

under the approved plan; and 

(b) Shall include fugitive emissions to the 

extent quantifiable, and emissions associated 

with startups, shutdowns, and malfunctions; 

and 

(c) Shall exclude, in calculating any 

increase in emissions that results from the 

particular project, that portion of the unit’s 

emissions following the project that an 

existing unit could have accommodated 

during the consecutive 24-month period used 

to establish the baseline actual emissions 

under paragraph II.A.30 of this Ruling and 

that are also unrelated to the particular 

project, including any increased utilization 

due to product demand growth; or, 

(d) In lieu of using the method set out in 

paragraphs II.A.24(ii)(a) through (c) of this 

Ruling, may elect to use the emissions unit’s 

potential to emit, in tons per year, as defined 

under paragraph II.A.3 of this Ruling. 

25. Nonattainment major new source 

review (NSR) program means a major source 

preconstruction permit program that 

implements Sections I through VI of this 

Ruling, or a program that has been approved 

by the Administrator and incorporated into 

the plan to implement the requirements of 

§ 51.165 of this part. Any permit issued 

under such a program is a major NSR permit. 

26. Continuous emissions monitoring 

system (CEMS) means all of the equipment 

that may be required to meet the data 

acquisition and availability requirements of 

this Ruling, to sample, condition (if 

applicable), analyze, and provide a record of 

emissions on a continuous basis. 

27. Predictive emissions monitoring system 

(PEMS) means all of the equipment necessary 

to monitor process and control device 

operational parameters (for example, control 

device secondary voltages and electric 

currents) and other information (for example, 

gas flow rate, O2 or CO2 concentrations), and 

calculate and record the mass emissions rate 

(for example, lb/hr) on a continuous basis. 

28. Continuous parameter monitoring 

system (CPMS) means all of the equipment 

necessary to meet the data acquisition and 

availability requirements of this Ruling, to 

monitor process and control device 

operational parameters (for example, control 

device secondary voltages and electric 

currents) and other information (for example, 

gas flow rate, O2 or CO2 concentrations), and 

to record average operational parameter 

value(s) on a continuous basis. 

29. Continuous emissions rate monitoring 

system (CERMS) means the total equipment 

required for the determination and recording 

of the pollutant mass emissions rate (in terms 

of mass per unit of time). 

30. Baseline actual emissions means the 

rate of emissions, in tons per year, of a 

regulated NSR pollutant, as determined in 

accordance with paragraphs II.A.30(i) 

through (iv) of this Ruling. 

(i) For any existing electric utility steam 

generating unit, baseline actual emissions 

means the average rate, in tons per year, at 

which the unit actually emitted the pollutant 

during any consecutive 24-month period 

selected by the owner or operator within the 

5-year period immediately preceding when 

the owner or operator begins actual 

construction of the project. The reviewing 

authority shall allow the use of a different 

time period upon a determination that it is 

more representative of normal source 

operation. 

(a) The average rate shall include fugitive 

emissions to the extent quantifiable, and 

emissions associated with startups, 

shutdowns, and malfunctions. 

(b) The average rate shall be adjusted 

downward to exclude any non-compliant 

emissions that occurred while the source was 

operating above any emission limitation that 

was legally enforceable during the 

consecutive 24-month period. 

(c) For a regulated NSR pollutant, when a 

project involves multiple emissions units, 

only one consecutive 24-month period must 

be used to determine the baseline actual 

emissions for the emissions units being 

changed. A different consecutive 24-month 

period can be used for each regulated NSR 

pollutant. 

(d) The average rate shall not be based on 

any consecutive 24-month period for which 

there is inadequate information for 

determining annual emissions, in tons per 

year, and for adjusting this amount if 

required by paragraph II.A.30(i)(b) of this 

Ruling. 

(ii) For an existing emissions unit (other 

than an electric utility steam generating unit), 

baseline actual emissions means the average 

rate, in tons per year, at which the emissions 

unit actually emitted the pollutant during 

any consecutive 24-month period selected by 

the owner or operator within the 10-year 

period immediately preceding either the date 

the owner or operator begins actual 

construction of the project, or the date a 

complete permit application is received by 

the reviewing authority for a permit required 

either under this Ruling or under a plan 

approved by the Administrator, whichever is 

earlier, except that the 10-year period shall 

not include any period earlier than 

November 15, 1990. 

(a) The average rate shall include fugitive 

emissions to the extent quantifiable, and 

emissions associated with startups, 

shutdowns, and malfunctions. 

(b) The average rate shall be adjusted 

downward to exclude any non-compliant 

emissions that occurred while the source was 

operating above an emission limitation that 

was legally enforceable during the 

consecutive 24-month period. 

(c) The average rate shall be adjusted 

downward to exclude any emissions that 

would have exceeded an emission limitation 

with which the major stationary source must 

currently comply, had such major stationary 

source been required to comply with such 

limitations during the consecutive 24-month 

period. However, if an emission limitation is 

part of a maximum achievable control 

technology standard that the Administrator 

proposed or promulgated under part 63 of 

this chapter, the baseline actual emissions 

need only be adjusted if the State has taken 

credit for such emissions reductions in an 


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attainment demonstration or maintenance 

plan. 

(d) For a regulated NSR pollutant, when a 

project involves multiple emissions units, 

only one consecutive 24-month period must 

be used to determine the baseline actual 

emissions for the emissions units being 

changed. A different consecutive 24-month 

period can be used for each regulated NSR 

pollutant. 

(e) The average rate shall not be based on 

any consecutive 24-month period for which 

there is inadequate information for 

determining annual emissions, in tons per 

year, and for adjusting this amount if 

required by paragraphs II.A.30(ii)(b) and (c) 

of this Ruling. 

(iii) For a new emissions unit, the baseline 

actual emissions for purposes of determining 

the emissions increase that will result from 

the initial construction and operation of such 

unit shall equal zero; and thereafter, for all 

other purposes, shall equal the unit’s 

potential to emit. 

(iv) For a PAL for a major stationary 

source, the baseline actual emissions shall be 

calculated for existing electric utility steam 

generating units in accordance with the 

procedures contained in paragraph II.A.30(i) 

of this Ruling, for other existing emissions 

units in accordance with the procedures 

contained in paragraph II.A.30(ii) of this 

Ruling, and for a new emissions unit in 

accordance with the procedures contained in 

paragraph II.A.30(iii) of this Ruling. 

31. Regulated NSR pollutant, for purposes 

of this Ruling, means the following: 

(i) Nitrogen oxides or any volatile organic 

compounds; 

(ii) Any pollutant for which a national 

ambient air quality standard has been 

promulgated. This includes, but is not 

limited to, the following: 

(a) PM2.5 emissions and PM10 emissions 

shall include gaseous emissions from a 

source or activity, which condense to form 

particulate matter at ambient temperatures. 

On or after January 1, 2011, such 

condensable particulate matter shall be 

accounted for in applicability determinations 

and in establishing emissions limitations for 

PM2.5 and PM10 in permits issued under this 

ruling. Compliance with emissions 

limitations for PM2.5 and PM10 issued prior 

to this date shall not be based on 

condensable particulate matter unless 

required by the terms and conditions of the 

permit or the applicable implementation 

plan. Applicability determinations made 

prior to this date without accounting for 

condensable particulate matter shall not be 

considered in violation of this section unless 

the applicable implementation plan required 

condensable particulate matter to be 

included. 

(b) Any pollutant that is identified under 

this paragraph II.A.31(ii)(2) as a constituent 

or precursor of a general pollutant listed 

under paragraph II.A.31(i) or (ii) of this 

Ruling, provided that such constituent or 

precursor pollutant may only be regulated 

under NSR as part of regulation of the general 

pollutant. Precursors identified by the 

Administrator for purposes of NSR are the 

following: 

(1) Volatile organic compounds and 

nitrogen oxides are precursors to ozone in all 

ozone nonattainment areas. 

(2) Sulfur dioxide and Nitrogen oxides are 

regulated as precursors to PM2.5 in all PM2.5

nonattainment areas. 

(3) For any area that was designated 

nonattainment for PM2.5 on or before April 

15, 2015, Volatile organic compounds and 

Ammonia shall be regulated as precursors to 

PM2.5 beginning on April 15, 2017, with 

respect to any permit issued for PM2.5, unless 

the following conditions are met: The state 

submits a SIP for the Administrator’s review 

containing the state’s preconstruction review 

provisions for PM2.5 consistent with § 51.165 

and a complete NNSR precursor 

demonstration consistent with 

§ 51.1006(a)(3); and such SIP is determined 

to be complete by the Administrator or 

deemed to be complete by operation of law 

in accordance with section 110(k)(1)(B) of the 

Act by April 15, 2017. If these conditions are 

met, the precursor(s) addressed by the NNSR 

precursor demonstration (Volatile organic 

compounds, Ammonia, or both) shall not be 

regulated as a precursor to PM2.5 in such area. 

If the Administrator subsequently 

disapproves the state’s preconstruction 

review provisions for PM2.5 and the NNSR 

precursor demonstration, the precursor(s) 

addressed by the NNSR precursor 

demonstration shall be regulated as a 

precursor to PM2.5 under this Ruling in such 

area as of April 15, 2017, or the effective date 

of the disapproval, whichever date is later. 

(4) For any area that is designated 

nonattainment for PM2.5 after April 15, 2015, 

and was not already designated 

nonattainment for PM2.5 on or immediately 

prior to such date, Volatile organic 

compounds and Ammonia shall be regulated 

as precursors to PM2.5 under this Ruling 

beginning 24 months from the date of 

designation as nonattainment for PM2.5 with 

respect to any permit issued for PM2.5, unless 

the following conditions are met: the state 

submits a SIP for the Administrator’s review 

which contains the state’s preconstruction 

review provisions for PM2.5 consistent with 

§ 51.165 and a complete NNSR precursor 

demonstration consistent with 

§ 51.1006(a)(3); and such SIP is determined 

to be complete by the Administrator or 

deemed to be complete by operation of law 

in accordance with section 110(k)(1)(B) of the 

Act by the date 24 months from the date of 

designation. If these conditions are met, the 

precursor(s) addressed by the NNSR 

precursor demonstration (Volatile organic 

compounds, Ammonia, or both) shall not be 

regulated as a precursor to PM2.5 in such area. 

If the Administrator subsequently 

disapproves the state’s preconstruction 

review provisions for PM2.5 and the NNSR 

precursor demonstration, the precursor(s) 

addressed by the NNSR precursor 

demonstration shall be regulated as a 

precursor to PM2.5 under this Ruling in such 

area as of the date 24 months from the date 

of designation, or the effective date of the 

disapproval, whichever date is later. 

32. Reviewing authority means the State air 

pollution control agency, local agency, other 

State agency, Indian tribe, or other agency 

issuing permits under this Ruling or 

authorized by the Administrator to carry out 

a permit program under §§ 51.165 and 51.166 

of this part, or the Administrator in the case 

of EPA-implemented permit programs under 

this Ruling or under § 52.21 of this chapter. 

33. Project means a discrete physical 

change in, or change in the method of 

operation of, an existing major stationary 

source, or a discrete group of such changes 

(occurring contemporaneously at the same 

major stationary source) that are substantially 

related to each other. Such changes are 

substantially related if they are dependent on 

each other to be economically or technically 

viable. In an extreme ozone nonattainment 

area, a ‘‘project’’ means each discrete 

operation, emissions unit, or other pollutantemitting activity. 

34. Best available control technology 

(BACT) means an emissions limitation 

(including a visible emissions standard) 

based on the maximum degree of reduction 

for each regulated NSR pollutant which 

would be emitted from any proposed major 

stationary source or major modification 

which the reviewing authority, on a case-bycase basis, taking into account energy, 

environmental, and economic impacts and 

other costs, determines is achievable for such 

source or modification through application of 

production processes or available methods, 

systems, and techniques, including fuel 

cleaning or treatment or innovative fuel 

combustion techniques for control of such 

pollutant. In no event shall application of 

best available control technology result in 

emissions of any pollutant which would 

exceed the emissions allowed by any 

applicable standard under 40 CFR part 60, 

61, or 63. If the reviewing authority 

determines that technological or economic 

limitations on the application of 

measurement methodology to a particular 

emissions unit would make the imposition of 

an emissions standard infeasible, a design, 

equipment, work practice, operational 

standard, or combination thereof, may be 

prescribed instead to satisfy the requirement 

for the application of BACT. Such standard 

shall, to the degree possible, set forth the 

emissions reduction achievable by 

implementation of such design, equipment, 

work practice or operation, and shall provide 

for compliance by means which achieve 

equivalent results. 

35. Prevention of Significant Deterioration 

(PSD) permit means any permit that is issued 

under a major source preconstruction permit 

program that has been approved by the 

Administrator and incorporated into the plan 

to implement the requirements of § 51.166, or 

under the program in § 52.21 of this chapter. 

36. Federal Land Manager means, with 

respect to any lands in the United States, the 

Secretary of the department with authority 

over such lands. 

37. Replacement unit means an emissions 

unit for which all the criteria listed in 

paragraphs II.A.37(i) through (iv) of this 

Ruling are met. No creditable emission 

reductions shall be generated from shutting 

down the existing emissions unit that is 

replaced. 

(i) The emissions unit is a reconstructed 

unit within the meaning of § 60.15(b)(1) of 

this chapter, or the emissions unit 


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completely takes the place of an existing 

emissions unit; 

(ii) The emissions unit is identical to or 

functionally equivalent to the replaced 

emissions unit; 

(iii) The replacement does not alter the 

basic design parameters of the process unit; 

and 

(iv) The replaced emissions unit is 

permanently removed from the major 

stationary source, otherwise permanently 

disabled, or permanently barred from 

operation by a permit that is enforceable as 

a practical matter. If the replaced emissions 

unit is brought back into operation, it shall 

constitute a new emissions unit. 

IV. Sources That Would Locate in a 

Designated Nonattainment Area 

* * * * * 

I. Applicability procedures. 

1. To determine whether a project 

constitutes a major modification, the 

reviewing authority shall apply the 

principles set out in paragraphs IV.I.1(i) 

through (vi) of this Ruling. 

(i) Except as otherwise provided in 

paragraph IV.I.2 of this Ruling, and 

consistent with the definition of major 

modification contained in paragraph II.A.5 of 

this Ruling, a project is a major modification 

for a regulated NSR pollutant if it causes two 

types of emissions increases—a significant 

emissions increase (as defined in paragraph 

II.A.23 of this Ruling), and a significant net 

emissions increase (as defined in paragraphs 

II.A.6 and 10 of this Ruling). The project is 

not a major modification if it does not cause 

a significant emissions increase. If the project 

causes a significant emissions increase, then 

the project is a major modification only if it 

also results in a significant net emissions 

increase. 

(ii) The procedure for calculating (before 

beginning actual construction) whether a 

significant emissions increase (i.e., the first 

step of the process) will occur depends upon 

the type(s) of emissions units that could be 

affected by the project, according to 

paragraphs IV.I.1(iii) through (vi) of this 

Ruling. The procedure for calculating (before 

beginning actual construction) whether a 

significant net emissions increase will occur 

at the major stationary source (i.e., the 

second step of the process) is contained in 

the definition in paragraph II.A.6 of this 

Ruling. Regardless of any such 

preconstruction projections, a major 

modification results if the project causes a 

significant emissions increase and a 

significant net emissions increase. 

(iii) Actual-to-projected-actual 

applicability test for projects that only 

involve existing emissions units. A significant 

emissions increase of a regulated NSR 

pollutant is projected to occur if the sum of 

the difference between the projected actual 

emissions (as defined in paragraph II.A.24 of 

this Ruling) and the baseline actual 

emissions (as defined in paragraphs II.A.30(i) 

and (ii) of this Ruling, as applicable), for each 

existing emissions unit, equals or exceeds the 

significant amount for that pollutant (as 

defined in paragraph II.A.10 of this Ruling). 

(iv) Actual-to-potential test for projects 

that only involve construction of a new 

emissions unit(s). A significant emissions 

increase of a regulated NSR pollutant is 

projected to occur if the sum of the difference 

between the potential to emit (as defined in 

paragraph II.A.3 of this Ruling) from each 

new emissions unit following completion of 

the project and the baseline actual emissions 

(as defined in paragraph II.A.30(iii) of this 

Ruling) of these units before the project 

equals or exceeds the significant amount for 

that pollutant (as defined in paragraph 

II.A.10 of this Ruling). 

(v) Hybrid test for projects that involve 

multiple types of emissions units. A 

significant emissions increase of a regulated 

NSR pollutant is projected to occur if the 

sum of the difference for all emissions units, 

using the method specified in paragraphs 

IV.I.1(iii) through (iv) of this Ruling as 

applicable with respect to each emissions 

unit, equals or exceeds the significant 

amount for that pollutant (as defined in 

paragraph II.A.10 of this Ruling). 

(vi) The ‘‘sum of the difference’’ as used in 

paragraphs IV.I.1(iii), (iv) and (v) of this 

Ruling shall include both increases and 

decreases in emissions calculated in 

accordance with those paragraphs. A 

decrease may only be accounted for in the 

significant emissions increase determination 

if it meets the requirements under paragraph 

II.A.6(v)(b) of this Ruling. 

2. For any major stationary source with a 

PAL for a regulated NSR pollutant, the major 

stationary source shall comply with 

requirements under paragraph IV.K of this 

Ruling. J. 

Provisions for projected actual emissions. 

Except as otherwise provided in paragraph 

IV.J.6(ii) of this Ruling, the provisions of this 

paragraph IV.J apply with respect to any 

regulated NSR pollutant emitted from 

projects that involve one or more existing 

emissions units at a major stationary source 

(other than projects at a source with a PAL) 

in circumstances where there is a reasonable 

possibility, within the meaning of paragraph 

IV.J.6 of this Ruling, that a project that is not 

a part of a major modification may result in 

a significant emissions increase of such 

pollutant, and the owner or operator elects to 

use the method specified in paragraphs 

II.A.24(ii)(a) through (c) of this Ruling for 

calculating projected actual emissions from 

any existing emissions unit. 

1. Before beginning actual construction of 

the project, the owner or operator shall 

document and maintain a record of the 

following information: (i) A description of 

the project that includes: the name of the 

project, the project’s intended objective(s), 

each physical change and/or change in the 

method of operation associated with the 

project objective(s), and estimated timeline 

for the project, including an estimation of 

when the project would begin actual 

construction and begin regular operation; 

(ii) Identification of the emissions unit(s) 

whose emissions of a regulated NSR 

pollutant could be affected by the project; 

and (iii) A description of the applicability 

test used to determine that the project is not 

a major modification for any regulated NSR 

pollutant, including the baseline actual 

emissions, the projected actual emissions, the 

amount of emissions excluded under 

paragraph II.A.24(ii)(c) of this Ruling and an 

explanation for why such amount was 

excluded, and the potential to emit, as 

applicable, and any netting calculations, if 

applicable. 

2. Before beginning actual construction, the 

owner or operator shall provide a copy of the 

information set out in paragraph IV.J.1 of this 

Ruling to the reviewing authority. Nothing in 

this paragraph IV.J.2 shall be construed to 

require the owner or operator of such a unit 

to obtain any determination from the 

reviewing authority before beginning actual 

construction. 

3. The owner or operator shall monitor the 

emissions of any regulated NSR pollutant 

that could increase as a result of the project 

and that is emitted by any emissions units 

identified in paragraph IV.J.1(ii) of this 

Ruling; and calculate and maintain a record 

of the annual emissions, in tons per year on 

a calendar year basis, for a period of 5 years 

following resumption of regular operations 

after the change, or for a period of 10 years 

following resumption of regular operations 

after the change if the project increases the 

design capacity or potential to emit of that 

regulated NSR pollutant at any existing 

emissions unit identified in paragraph 

IV.J.1(ii) of this Ruling. 

4. If the project involves an existing 

electric utility steam generating unit, the 

owner or operator shall submit a report to the 

reviewing authority within 60 days after the 

end of each year, during which records must 

be generated under paragraph IV.J.3 of this 

Ruling setting out the annual emissions from 

each affected emissions unit during the 

calendar year that preceded submission of 

the report. 

5. If the project does not involve an 

existing electric utility steam generating unit, 

the owner or operator shall submit a report 

to the reviewing authority if the annual 

emissions, in tons per year, from the project 

identified in paragraph IV.J.1 of this Ruling, 

exceed the baseline actual emissions (as 

documented and maintained pursuant to 

paragraph IV.J.1(iii) of this Ruling) by a 

significant amount (as defined in paragraph 

II.A.10 of this Ruling) for that regulated NSR 

pollutant, and if such emissions differ from 

the preconstruction projection as 

documented and maintained pursuant to 

paragraph IV.J.1(iii) of this Ruling. Such 

report shall be submitted to the reviewing 

authority within 60 days after the end of such 

year. The report shall contain the following: 

(i) The name, address and telephone 

number of the major stationary source; 

(ii) The annual emissions as calculated 

pursuant to paragraph IV.J.3 of this Ruling; 

and 

(iii) Any other information that the owner 

or operator wishes to include in the report 

(e.g., an explanation as to why the emissions 

differ from the preconstruction projection). 

6. A ‘‘reasonable possibility’’ under 

paragraph IV.J of this Ruling occurs when the 

owner or operator calculates the project to 

result in either: 

(i) A projected actual emissions increase of 

at least 50 percent of the amount that is a 

‘‘significant emissions increase,’’ as defined 

under paragraph II.A.23 of this Ruling 

(without reference to the amount that is a 


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significant net emissions increase), for the 

regulated NSR pollutant; or 

(ii) A projected actual emissions increase 

that, added to the amount of emissions 

excluded under paragraph II.A.24(ii)(c) of 

this Ruling, sums to at least 50 percent of the 

amount that is a ‘‘significant emissions 

increase,’’ as defined under paragraph II.A.23 

of this Ruling (without reference to the 

amount that is a significant net emissions 

increase), for the regulated NSR pollutant. 

For a project for which a reasonable 

possibility occurs only within the meaning of 

paragraph IV.J.6(ii) of this Ruling, and not 

also within the meaning of paragraph IV.J.6(i) 

of this Ruling, then provisions in paragraphs 

IV.J.2 through IV.J.5 of this Ruling do not 

apply to the project; or 

(iii) The owner or operator accounts for a 

decrease in emissions from one or more 

emissions unit(s) in determining that the 

project is not a major modification for a 

regulated NSR pollutant regardless of the 

projected actual emissions increase. 

7. The owner or operator of the source 

shall make the information required to be 

documented and maintained pursuant to this 

paragraph IV.J of this Ruling available for 

review upon a request for inspection by the 

reviewing authority or the general public 

pursuant to the requirements contained in 

§ 70.4(b)(3)(viii) of this chapter. 

PART 52—APPROVAL AND 

PROMULGATION OF 

IMPLEMENTATION PLANS 

■ 5. The authority citation for part 52 

continues to read as follows: 

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

Subpart A—General Provisions 

§ 52.21 [Amended] 

■ 6. Amend § 52.21 by: 

■ a. Revising and republishing 

paragraph (a)(2); 

■ b. Revising paragraph (b)(52); and 

■ c. Revising and republishing 

paragraph (r)(6). 

The revisions and republications read 

as follows: 

§ 52.21 Prevention of significant 

deterioration of air quality. 

(a) * * * 

(2) Applicability procedures. (i) The 

requirements of this section apply to the 

construction of any new major 

stationary source (as defined in 

paragraph (b)(1) of this section) or any 

project at an existing major stationary 

source in an area designated as 

attainment or unclassifiable under 

sections 107(d)(1)(A)(ii) or (iii) of the 

Act. 

(ii) The requirements of paragraphs (j) 

through (r) of this section apply to the 

construction of any new major 

stationary source or the major 

modification of any existing major 

stationary source, except as this section 

otherwise provides. 

(iii) No new major stationary source 

or major modification to which the 

requirements of paragraphs (j) through 

(r)(5) of this section apply shall begin 

actual construction without a permit 

that states that the major stationary 

source or major modification will meet 

those requirements. The Administrator 

has authority to issue any such permit. 

(iv) The requirements of the program 

will be applied in accordance with the 

principles set out in paragraphs 

(a)(2)(iv)(a) through (g) of this section. 

(a) Except as otherwise provided in 

paragraph (a)(2)(v) of this section, and 

consistent with the definition of major 

modification contained in paragraph 

(b)(2) of this section, a project is a major 

modification for a regulated NSR 

pollutant if it causes two types of 

emissions increases—a significant 

emissions increase (as defined in 

paragraph (b)(40) of this section) and a 

significant net emissions increase (as 

defined in paragraphs (b)(3) and (23) of 

this section). The project is not a major 

modification if it does not cause a 

significant emissions increase. If the 

project causes a significant emissions 

increase, then the project is a major 

modification only if it also results in a 

significant net emissions increase. 

(b) The procedure for calculating 

(before beginning actual construction) 

whether a significant emissions increase 

(i.e., the first step of the process) will 

occur depends upon the type(s) of 

emissions units that could be affected 

by the project, according to paragraphs 

(a)(2)(iv)(c) through (g) of this section. 

The procedure for calculating (before 

beginning actual construction) whether 

a significant net emissions increase will 

occur at the major stationary source (i.e., 

the second step of the process) is 

contained in the definition in paragraph 

(b)(3) of this section. Regardless of any 

such preconstruction projections, a 

major modification results if the project 

causes a significant emissions increase 

and a significant net emissions increase. 

(c) Actual-to-projected-actual 

applicability test for projects that only 

involve existing emissions units. A 

significant emissions increase of a 

regulated NSR pollutant is projected to 

occur if the sum of the difference 

between the projected actual emissions 

(as defined in paragraph (b)(41) of this 

section) and the baseline actual 

emissions (as defined in paragraphs 

(b)(48)(i) and (ii) of this section), for 

each existing emissions unit, equals or 

exceeds the significant amount for that 

pollutant (as defined in paragraph 

(b)(23) of this section). 

(d) Actual-to-potential test for projects 

that only involve construction of a new 

emissions unit(s). A significant 

emissions increase of a regulated NSR 

pollutant is projected to occur if the 

sum of the difference between the 

potential to emit (as defined in 

paragraph (b)(4) of this section) from 

each new emissions unit following 

completion of the project and the 

baseline actual emissions (as defined in 

paragraph (b)(48)(iii) of this section) of 

these units before the project equals or 

exceeds the significant amount for that 

pollutant (as defined in paragraph 

(b)(23) of this section). 

(e) [Reserved] 

(f) Hybrid test for projects that involve 

multiple types of emissions units. A 

significant emissions increase of a 

regulated NSR pollutant is projected to 

occur if the sum of the difference for all 

emissions units, using the method 

specified in paragraphs (a)(2)(iv)(c) and 

(d) of this section as applicable with 

respect to each emissions unit, equals or 

exceeds the significant amount for that 

pollutant (as defined in paragraph 

(b)(23) of this section). 

(g) The ‘‘sum of the difference’’ as 

used in paragraphs (a)(2)(iv)(c), (d) and 

(f) of this section shall include both 

increases and decreases in emissions 

calculated in accordance with those 

paragraphs. A decrease may only be 

accounted for in the significant 

emissions increase determination if it 

meets the requirements under 40 CFR 

52.21(b)(3)(vi)(b). 

(v) For any major stationary source for 

a PAL for a regulated NSR pollutant, the 

major stationary source shall comply 

with the requirements under paragraph 

(aa) of this section. 

(b) * * * 

(52) Project means a discrete physical 

change in, or change in the method of 

operation of, an existing major 

stationary source, or a discrete group of 

such changes (occurring 

contemporaneously at the same major 

stationary source) that are substantially 

related to each other. Such changes are 

substantially related if they are 

dependent on each other to be 

economically or technically viable. 

* * * * * 

(r) * * * 

(6) Except as otherwise provided in 

paragraph (r)(6)(vi)(b) of this section, the 

provisions of this paragraph (r)(6) apply 

with respect to any regulated NSR 

pollutant emitted from projects that 

involve one or more existing emissions 

units at a major stationary source (other 

than projects at a source with a PAL) in 

circumstances where there is a 

reasonable possibility, within the 

meaning of paragraph (r)(6)(vi) of this 

section, that a project that is not a part 

of a major modification may result in a 


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Federal Register / Vol. 89, No. 87 / Friday, May 3, 2024 / Proposed Rules 36905 

significant emissions increase of such 

pollutant, and the owner or operator 

elects to use the method specified in 

paragraphs (b)(41)(ii)(a) through (c) of 

this section for calculating projected 

actual emissions from any existing 

emissions unit. 

(i) Before beginning actual 

construction of the project, the owner or 

operator shall document and maintain a 

record of the following information: (a) 

A description of the project that 

includes: the name of the project, the 

project’s intended objective(s), each 

physical change and/or change in the 

method of operation associated with the 

project objective(s), and estimated 

timeline for the project, including an 

estimation of when the project would 

begin actual construction and begin 

regular operation; 

(b) Identification of the emissions 

unit(s) whose emissions of a regulated 

NSR pollutant could be affected by the 

project; and (c) A description of the 

applicability test used to determine that 

the project is not a major modification 

for any regulated NSR pollutant, 

including the baseline actual emissions, 

the projected actual emissions, the 

amount of emissions excluded under 

paragraph (b)(41)(ii)(c) of this section 

and an explanation for why such 

amount was excluded, the potential to 

emit, as applicable, and any netting 

calculations, if applicable. 

(ii) Before beginning actual 

construction, the owner or operator 

shall provide a copy of the information 

set out in paragraph (r)(6)(i) of this 

section to the reviewing authority. 

Nothing in this paragraph (r)(6)(ii) shall 

be construed to require the owner or 

operator of such a unit to obtain any 

determination from the reviewing 

authority before beginning actual 

construction. 

(iii) The owner or operator shall 

monitor the emissions of any regulated 

NSR pollutant that could increase as a 

result of the project and that is emitted 

by any emissions unit identified in 

paragraph (r)(6)(i)(b) of this section; and 

calculate and maintain a record of the 

annual emissions, in tons per year on a 

calendar year basis, for a period of 5 

years following resumption of regular 

operations after the change, or for a 

period of 10 years following resumption 

of regular operations after the change if 

the project increases the design capacity 

or potential to emit that regulated NSR 

pollutant at any existing emissions unit 

identified in 40 CFR 52.21(r)(6)(i)(b). 

(iv) If the project involves an existing 

electric utility steam generating unit, the 

owner or operator shall submit a report 

to the Administrator within 60 days 

after the end of each year during which 

records must be generated under 

paragraph (r)(6)(iii) of this section 

setting out the annual emissions from 

each affected emissions unit during the 

calendar year that preceded submission 

of the report. 

(v) If the project does not involve an 

existing electric utility steam generating 

unit, the owner or operator shall submit 

a report to the Administrator if the 

annual emissions, in tons per year, from 

the project identified in paragraph 

(r)(6)(i) of this section, exceed the 

baseline actual emissions (as 

documented and maintained pursuant 

to paragraph (r)(6)(i)(c) of this section), 

by a significant amount (as defined in 

paragraph (b)(23) of this section) for that 

regulated NSR pollutant, and if such 

emissions differ from the 

preconstruction projection as 

documented and maintained pursuant 

to paragraph (r)(6)(i)(c) of this section. 

Such report shall be submitted to the 

Administrator within 60 days after the 

end of such year. The report shall 

contain the following: 

(a) The name, address and telephone 

number of the major stationary source; 

(b) The annual emissions as 

calculated pursuant to paragraph 

(r)(6)(iii) of this section; and 

(c) Any other information that the 

owner or operator wishes to include in 

the report (e.g., an explanation as to 

why the emissions differ from the 

preconstruction projection). 

(vi) A ‘‘reasonable possibility’’ under 

paragraph (r)(6) of this section occurs 

when the owner or operator calculates 

the project to result in either: 

(a) A projected actual emissions 

increase of at least 50 percent of the 

amount that is a ‘‘significant emissions 

increase,’’ as defined under paragraph 

(b)(40) of this section (without reference 

to the amount that is a significant net 

emissions increase), for the regulated 

NSR pollutant; or 

(b) A projected actual emissions 

increase that, added to the amount of 

emissions excluded under paragraph 

(b)(41)(ii)(c) of this section, sums to at 

least 50 percent of the amount that is a 

‘‘significant emissions increase,’’ as 

defined under paragraph (b)(40) of this 

section (without reference to the amount 

that is a significant net emissions 

increase), for the regulated NSR 

pollutant. For a project for which a 

reasonable possibility occurs only 

within the meaning of paragraph 

(r)(6)(vi)(b) of this section, and not also 

within the meaning of paragraph 

(r)(6)(vi)(a) of this section, then 

provisions (r)(6)(ii) through (v) do not 

apply to the project; or 

(c) The owner or operator accounts for 

a decrease in emissions from one or 

more emissions unit(s) in determining 

that the project is not a major 

modification for a regulated NSR 

pollutant regardless of the projected 

actual emissions increase. 

* * * * * 

[FR Doc. 2024–04029 Filed 5–2–24; 8:45 am] 

BILLING CODE 6560–50–P 


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