25178 Federal Register / Vol. 76, No. 85 / Tuesday, May 3, 2011 / Rules and Regulations 

1Prevention of Significant Deterioration and Title 

V Greenhouse Gas Tailoring Rule; Final Rule. 75 FR 

31,514 (June 3, 2010). The Tailoring Rule is 

described in more detail later in this preamble. 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 52 

[EPA–HQ–OAR–2010–1033; FRL–9299–9] 

RIN 2060–AQ68 

Determinations Concerning Need for 

Error Correction, Partial Approval and 

Partial Disapproval, and Federal 

Implementation Plan Regarding 

Texas’s Prevention of Significant 

Deterioration Program 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Final rule. 

SUMMARY: EPA is finalizing a correction 

to its previous full approval of Texas’s 

Clean Air Act (CAA) Prevention of 

Significant Deterioration (PSD) program 

to be a partial approval and partial 

disapproval and is also promulgating a 

Federal Implementation Plan (FIP) for 

Texas. These actions are based on EPA’s 

determination that at the time EPA 

approved Texas’s PSD program, the 

program was flawed because the state 

did not address how the program would 

apply to all pollutants that would 

become newly subject to regulation in 

the future, including non-National 

Ambient Air Quality Standard (NAAQS) 

pollutants, among them greenhouse 

gases (GHGs). The partial disapproval 

requires EPA to promulgate a FIP and 

EPA is doing so to assure that GHGemitting sources in Texas are able to 

proceed with plans to construct or 

expand. 

DATES: This action is effective on May 

1, 2011. 

ADDRESSES: EPA has established a 

docket for this rulemaking under Docket 

ID No. EPA–HQ–OAR–2010–1033. All 

documents in the docket are listed in 

the http://www.regulations.gov index. 

Although listed in the index, some 

information is not publicly available, 

e.g., confidential business information 

or other information whose disclosure is 

restricted by statute. Certain other 

material, such as copyrighted material, 

will be publicly available only in hard 

copy. Publicly available docket 

materials are available either 

electronically in http:// 

www.regulations.gov or in hard copy at 

the U.S. Environmental Protection 

Agency, Air Docket, EPA/DC, EPA West 

Building, Room 3334, 1301 Constitution 

Ave., NW., Washington, DC. The Public 

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

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

excluding legal holidays. The telephone 

number for the Public Reading Room is 

(202) 566–1744, and the telephone 

number for the Air Docket is (202) 566– 

1742. 

FOR FURTHER INFORMATION CONTACT: For 

information on this rule, contact Ms. 

Cheryl Vetter, Air Quality Policy 

Division, Office of Air Quality Planning 

and Standards (C504–03), 

Environmental Protection Agency, 

Research Triangle Park, NC 27711; 

telephone number: (919) 541–4391; fax 

number: (919) 541–5509; e-mail 

address: vetter.cheryl@epa.gov. 

SUPPLEMENTARY INFORMATION: 

I. General Information 

A. Does this action apply to me? 

The only governmental entity 

potentially affected by this rule is the 

State of Texas. Other entities potentially 

affected by this rule include sources in 

all industry groups within the State of 

Texas, which have a direct obligation 

under the CAA to obtain a PSD permit 

for GHGs for projects that meet the 

applicability thresholds set forth in the 

Tailoring Rule.1 This independent 

obligation on sources is specific to PSD 

and derives from CAA section 165(a). 

The majority of entities potentially 

affected by this action are expected to be 

in the following groups: 

Industry Group NAICSa

Utilities (electric, natural gas, other systems) .......................................... 2211, 2212, 2213. 

Manufacturing (food, beverages, tobacco, textiles, leather) .................... 311, 312, 313, 314, 315, 316. 

Wood product, paper manufacturing ........................................................ 321, 322. 

Petroleum and coal products manufacturing ........................................... 32411, 32412, 32419. 

Chemical manufacturing ........................................................................... 3251, 3252, 3253, 3254, 3255, 3256, 3259. 

Rubber product manufacturing ................................................................. 3261, 3262. 

Miscellaneous chemical products ............................................................. 32552, 32592, 32591, 325182, 32551.

Nonmetallic mineral product manufacturing ............................................. 3271, 3272, 3273, 3274, 3279. 

Primary and fabricated metal manufacturing ........................................... 3311, 3312, 3313, 3314, 3315, 3321, 3322, 3323, 3324, 3325, 3326, 

3327, 3328, 3329. 

Machinery manufacturing ......................................................................... 3331, 3332, 3333, 3334, 3335, 3336, 3339. 

Computer and electronic products manufacturing ................................... 3341, 3342, 3343, 3344, 3345, 4446. 

Electrical equipment, appliance, and component manufacturing ............ 3351, 3352, 3353, 3359. 

Transportation equipment manufacturing ................................................. 3361, 3362, 3363, 3364, 3365, 3366, 3369. 

Furniture and related product manufacturing ........................................... 3371, 3372, 3379. 

Miscellaneous manufacturing ................................................................... 3391, 3399. 

Waste management and remediation ...................................................... 5622, 5629. 

Hospitals/nursing and residential care facilities ....................................... 6221, 6231, 6232, 6233, 6239. 

Personal and laundry services ................................................................. 8122, 8123. 

Non-residential (commercial) .................................................................... Not available. Codes only exist for private households, construction 

and leasing/sales industries. 

a North American Industry Classification System. 

B. How is the preamble organized? 

The information presented in this 

preamble is organized as follows: 

I. General Information 

A. Does this action apply to me? 

B. How is the preamble organized? 

II. Overview of Rulemaking 

III. Background 

A. Requirements for SIP Submittals and 

EPA Action 

B. General Requirements for the PSD 

Program 

C. Regulatory Background: Texas SIP and 

PSD Program 

D. Regulatory Background: GHG Rules 

IV. Final Action and Response to Comments 

A. Response to General Comments on the 

Operation of the PSD Program 


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2Texas will continue to be the permitting 

authority for non-GHG pollutants for sources that 

triggered PSD requirements due to such other 

pollutants. EPA will be the permitting authority for 

all pollutants for sources that trigger PSD solely 

because of their GHGs, which may occur after July 

1, 2011, under the Tailoring Rule. This permitting 

process will also take place in the seven other states 

for which EPA is implementing a GHG PSD FIP. 

3States are subject to sanctions for failure to 

submit, or for EPA disapproval of, SIPs for 

nonattainment areas, under CAA section 179. These 

Continued 

B. Determination That EPA’s Previous 

Approval of Texas’s PSD Program Was in 

Error 

C. Error Correction: Conversion of Previous 

Approval to Partial Approval and Partial 

Disapproval 

D. Reconsideration Under CAA Section 

301, Other CAA Provisions, and Case 

Law 

E. Relationship of This Action to GHG PSD 

SIP Call 

F. Relationship of This Rulemaking to 

Other States 

G. Federal Implementation Plan 

V. Statutory and Executive Order Reviews 

A. Executive Order 12866: Regulatory 

Planning and Review and Executive 

Order 13563: Improving Regulation and 

Regulatory Review 

B. Paperwork Reduction Act 

C. Regulatory Flexibility Act 

D. Unfunded Mandates Reform 

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 

Risks 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 

J. Executive Order 12898—Federal Actions 

to Address Environmental Justice in 

Minority Populations and Low-Income 

Populations 

K. Congressional Review Act 

VI. Judicial Review 

II. Overview of Rulemaking 

This notice-and-comment final 

rulemaking is intended to assure that 

large GHG-emitting sources in Texas, 

which became subject to PSD on 

January 2, 2011, will continue to be able 

to obtain preconstruction permits under 

the CAA New Source Review (NSR) PSD 

program beyond the April 30, 2011, 

expiration date of the FIP that EPA put 

in place for this purpose via an Interim 

Final Rule. ‘‘Determinations Concerning 

Need for Error Correction, Partial 

Approval and Partial Disapproval, and 

Federal Implementation Plan Regarding 

Texas Prevention of Significant 

Deterioration Program; Interim Final 

Rule.’’ 75 FR 82,430 (Dec. 30, 2010). In 

this manner, this rulemaking will allow 

those sources to avoid delays in 

construction or modification. 

As in the interim final rulemaking, 

EPA is determining in this rulemaking 

that it erred in fully approving Texas’s 

PSD program in 1992 because at that 

time, the program had a gap, which 

recent statements by Texas have made 

particularly evident. The program did 

not address its application to, or provide 

assurances that it has adequate legal 

authority to apply to, all pollutants 

newly subject to regulation, including 

non-NAAQS pollutants, among them 

GHGs. As a result, EPA is correcting its 

previous full approval to be a partial 

approval and partial disapproval. EPA is 

taking this action through the errorcorrection mechanism provided under 

CAA section 110(k)(6). The partial 

disapproval requires EPA, under CAA 

section 110(c)(1)(B), to promulgate a FIP 

within 2 years, and, as part of this 

rulemaking, EPA is exercising its 

discretion to promulgate the FIP 

immediately. Under the FIP, EPA will 

become the permitting authority for, and 

apply Federal PSD requirements to, 

large GHG-emitting sources in 

accordance with the thresholds 

established under what we call the 

Tailoring Rule, which EPA published by 

notice dated June 3, 2010, 75 FR 

31,514.2

By becoming the permitting authority, 

EPA will be able to process 

preconstruction PSD permit 

applications for GHG-emitting sources 

and thereby allow the affected sources 

to avoid delays in construction and 

modification. According to Texas, 167 

GHG-emitting sources will require PSD 

permits during 2011. These sources 

have a real need to have a permitting 

authority in place in Texas. Although 

the CAA allows states to implement 

PSD, and Texas has been implementing 

an EPA-approved PSD program since 

1992, Texas has recently informed EPA 

that it does not have the intention or the 

authority to apply PSD to GHG-emitting 

sources, and that it could very well 

maintain this position even if the U.S. 

Court of Appeals for the DC Circuit (the 

DC Circuit) upholds the GHG rules 

against legal challenges that Texas and 

other parties have recently brought. 

Texas’s unwillingness to implement this 

aspect of the Federal PSD program 

leaves EPA no choice but to resume its 

role as the permitting authority for this 

portion, in order to assure that 

businesses in Texas are not subject to 

delays or potential legal challenges and 

are able to move forward with planned 

construction and expansion projects 

that will create jobs and otherwise 

benefit the state’s and the nation’s 

economy. EPA has determined that this 

action is necessary at this time so that 

there is no period of time when sources 

are unable to obtain necessary PSD 

permits. 

In order to assure no gap in 

permitting, EPA is establishing May 1, 

2011, as the effective date for the FIP, 

which immediately follows the 

expiration of the interim-final FIP EPA 

published by notice dated December 30, 

2010. EPA stated in the interim final 

rule that the FIP would remain in place 

until April 30, 2011. 

III. Background 

A. Requirements for SIP Submittals and 

EPA Action 

This section reviews background 

information concerning the CAA 

requirements for what SIPs must 

include, the process for state submittals 

of SIPs, requirements for EPA action on 

SIPs and SIP revisions, and FIPs. 

1. Requirements for What SIPs Must 

Include 

Congress enacted the NAAQS and SIP 

requirements in the 1970 CAA 

Amendments. CAA section 110(a)(1) 

requires that states adopt and submit to 

EPA for approval SIPs that implement 

the NAAQS. CAA section 110(a)(2) 

contains a detailed list of requirements 

that all SIPs must include to be 

approvable by EPA. 

Of particular relevance for this action, 

subparagraph (E)(i) of CAA section 

110(a)(2) provides that SIPs must 

‘‘provide * * * necessary assurances 

that the state * * * will have adequate 

personnel, funding, and authority under 

State * * * law to carry out such 

implementation plan.* * *’’ As 

applicable to PSD programs, this 

provision means that EPA may approve 

the SIP PSD provisions only if EPA is 

satisfied that the state will have 

adequate legal authority under state law. 

2. EPA Action on SIP Submittals 

After a SIP or SIP revision has been 

submitted, EPA is authorized to act on 

it under CAA section 110(k)(3)–(4). 

Those provisions authorize a full 

approval or, if the SIP or SIP revision 

meets some but not all of the applicable 

requirements, a conditional approval, a 

partial approval and disapproval, or a 

full disapproval. If EPA disapproves a 

required SIP or SIP revision, then EPA 

must promulgate a FIP at any time 

within 2 years after the disapproval, 

unless the state corrects the deficiency 

within that period of time by submitting 

a SIP revision that EPA approves. CAA 

section 110(c)(1).3


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sanctions provisions are not relevant for this rule 

because they do not apply to PSD SIPs. 

3. SIP Call 

The CAA provides a mechanism for 

the correction of SIPs with certain types 

of inadequacies, under CAA section 

110(k)(5), which provides: 

(5) Calls for plan revisions 

Whenever the Administrator finds that the 

applicable implementation plan for any area 

is substantially inadequate to * * * comply 

with any requirement of this Act, the 

Administrator shall require the State to revise 

the plan as necessary to correct such 

inadequacies. The Administrator shall notify 

the State of the inadequacies and may 

establish reasonable deadlines (not to exceed 

18 months after the date of such notice) for 

the submission of such plan revisions. 

This provision by its terms authorizes 

the Administrator to ‘‘find[] that [a SIP] 

* * * is substantially inadequate to 

* * * comply with any requirement of 

this Act,’’ and, based on that finding, to 

‘‘require the State to revise the [SIP] 

* * * to correct such inadequacies.’’ 

This latter action is commonly referred 

to as a ‘‘SIP call.’’ In addition, this 

provision authorizes EPA to establish a 

‘‘reasonable deadline[] (not to exceed 18 

months after the date of such notice)’’ 

for the submission of the corrective SIP 

revision. 

If EPA does not receive the corrective 

SIP revision by the deadline, CAA 

section 110(c) authorizes EPA to ‘‘find[] 

that [the] State has failed to make a 

required submission.’’ CAA section 

110(c)(1)(A). Once EPA makes that 

finding, CAA section 110(c)(1) requires 

EPA to ‘‘promulgate a Federal 

implementation plan at any time within 

2 years after the [finding] * * * unless 

the State corrects the deficiency, and 

[EPA] approves the plan or plan 

revision, before [EPA] promulgates such 

[FIP].’’ 

CAA section 110(k)(5), by its terms— 

specifically, the use of the term 

‘‘[w]henever’’—authorizes, but does not 

require, EPA to make the specified 

finding and does not impose any time 

constraints for EPA to do so. As a result, 

EPA has discretion in determining 

whether and when to make the specified 

finding. See New York Public Interest 

Research Group v. Whitman, 321 F.3d 

316, 330–31 (2d Cir. 2003) (opening 

phrase ‘‘Whenever the Administrator 

makes a determination’’ in CAA section 

502(i)(1) grants EPA ‘‘discretion whether 

to make a determination’’); Her Majesty 

the Queen in Right of Ontario v. EPA, 

912 F.2d 1525, 1533 (DC Cir. 1990) 

(‘‘whenever’’ in CAA section 115(a) 

‘‘impl[ied] a degree of discretion’’ in 

whether EPA had to make a finding). 

4. Authority for EPA to Revise Previous 

Action on SIPs 

EPA has authority to revise its 

previous actions concerning SIP 

submittals. Two mechanisms are 

available to EPA: The error correction 

mechanism provided under CAA 

section 110(k)(6), and EPA’s general 

administrative authority to reconsider 

its own actions under CAA sections 110 

and 301(a), in light of case law. 

(a) Error Correction Under CAA Section 

110(k)(6) 

CAA section 110(k)(6) provides as 

follows: 

Whenever the Administrator determines 

that the Administrator’s action approving, 

disapproving, or promulgating any plan or 

plan revision (or part thereof), area 

designation, redesignation, classification, or 

reclassification was in error, the 

Administrator may in the same manner as the 

approval, disapproval, or promulgation 

revise such action as appropriate without 

requiring any further submission from the 

State. Such determination and the basis 

thereof shall be provided to the State and 

public. 

The key provisions for present purposes 

are that the Administrator has the 

authority to ‘‘determine[]’’ when a SIP 

approval was ‘‘in error,’’ and when she 

does so, she may then revise the SIP 

approval ‘‘as appropriate,’’ in the same 

manner as the approval, and without 

requiring any further submission from 

the state. 

As quoted previously, CAA section 

110(k)(6) provides EPA with the 

authority to correct its own ‘‘error,’’ but 

nowhere does this provision or any 

other provision in the CAA define what 

qualifies as ‘‘error.’’ Thus, the term 

should be given its plain language, 

everyday meaning, which includes all 

unintentional, incorrect or wrong 

actions or mistakes. 

The legislative history of CAA section 

110(k)(6) is silent regarding the 

definition of error, but the timing of the 

enactment of the provision suggests a 

broad interpretation. The provision was 

enacted shortly after the Third Circuit 

decision in Concerned Citizens of 

Bridesburg v. U.S. EPA, 836 F.2d 777 

(1987). In Bridesburg, the court adopted 

a narrow interpretation of EPA’s 

authority to unilaterally correct errors. 

The court stated that such authority was 

limited to typographical and other 

similar errors, and stated that any other 

change to a SIP must be accomplished 

through a SIP revision. Id. at 786. In 

Bridesburg, EPA determined that it 

lacked authority to include odor 

regulations as part of a SIP unless the 

odor regulations had a significant 

relationship to achieving a NAAQS, and 

so directly acted to remove 13-year-old 

odor provisions from the Pennsylvania 

SIP. Id. at 779–80. EPA found the 

previous approval of the provisions to 

have been an inadvertent error, and so 

used its ‘‘inherent authority to correct an 

inadvertent mistake’’ to withdraw its 

prior approval of the odor regulations 

without seeking approval of the change 

from Pennsylvania. Id. at 779–80, 785. 

After noting that Congress had not 

contemplated the need for revision on 

the grounds cited by EPA, Id. at 780, the 

court found that EPA’s ‘‘inherent 

authority to correct an inadvertent 

mistake’’ was limited to corrections such 

as ‘‘typographical errors,’’ and that 

instead EPA was required to use the SIP 

revision process to remove the odor 

provision from the SIP. Id. at 785–86. 

When the court made its 

determination in Bridesburg in 1987, 

there was no provision explicitly 

addressing EPA’s error correction 

authority under the CAA. In 1990, 

Congress passed CAA section 110(k)(6). 

The legislative history says little about 

the provision, and does not mention 

Bridesburg. Even so, the terms of the 

provision make it evident that Congress 

authorized EPA to undertake a broader 

set of revisions under the guise of error 

correction than the Bridesburg court 

read the pre-existing Clean Air Act to 

authorize, and that Congress did not 

intend to codify the holding of 

Bridesburg. This is apparent because 

CAA section 110(k)(6) both (i) 

authorizes EPA to correct SIP approvals 

and other actions that were ‘‘in error,’’ 

which, as noted previously, broadly 

covers any mistake, and thereby 

contrasts with the holding in Bridesburg 

that EPA’s pre-section 110(k)(6) 

authority was limited to correction of 

typographical or similar mistakes; and 

(ii) provides that the error correction 

need not be accomplished via the SIP 

revision or SIP call process, which 

contrasts with the holding of Bridesburg 

requiring a SIP revision. By the same 

token, because the Bridesburg decision 

stood for the proposition that EPA could 

not correct anything more than a narrow 

range of errors, had Congress intended 

to codify the decision in Bridesburg, it 

is logical that Congress would have 

described the type of error that EPA was 

authorized to correct in the same 

limited way that the decision did. In 

this manner, the fact that Congress 

adopted CAA section 110(k)(6) against 

the backdrop of the Bridesburg case 

confirms that the provision cover a 

broad range of errors. 

EPA has used CAA section 110(k)(6) 

in the past to correct errors of a nontechnical nature. Most recently, EPA 

withdrew its approval of SIP PSD 


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4For additional case law, see Belville Mining Co. 

v. United States, 999 F.2d 989, 997 (6th Cir. 1993); 

Dun & Bradstreet Corp. v. United States Postal 

Service, 946 F.2d 189, 193 (2d Cir. 1991); Iowa 

Power & Light Co. v. United States, 712 F.2d 1292 

(8th Cir. 1983). 

programs in 24 states to the extent they 

apply PSD to GHG-emitting sources 

below the thresholds in the final 

Tailoring Rule. ‘‘Limitation of Approval 

of Prevention of Significant 

Deterioration Provisions Concerning 

Greenhouse Gas Emitting Sources in 

State Implementation Plans; Final Rule,’’ 

75 FR 82,536 (Dec. 30, 2010)(Narrowing 

Rule). In addition, EPA has used CAA 

section 110(k)(6) as authority to make 

substantive corrections to remove a 

variety of provisions from Federally 

approved SIPs that are not related to the 

attainment or maintenance of NAAQS 

or any other CAA requirement. See, e.g., 

‘‘Approval and Promulgation of 

Implementation Plans; Kentucky: 

Approval of Revisions to the State 

Implementation Plan,’’ 75 FR 2,440 (Jan. 

15, 2010) (correcting the SIP by 

removing a provision, approved in 1982, 

used to address hazardous or toxic air 

pollutants); ‘‘Approval and 

Promulgation of Implementation Plans; 

New York,’’ 73 FR 21,546 (April 22, 

2008) (issuing a direct final rule to 

correct a prior SIP correction from 1998 

that removed general duties from the 

SIP but neglected to remove a reference 

to ‘‘odor’’ in the definition of ‘‘air 

contaminant or air pollutant’’); 

‘‘Approval and Promulgation of 

Implementation Plans; New York,’’ 63 

FR 65,557 (Nov. 27, 1998) (issuing 

direct final rule to correct SIP by 

removing a general duty ‘‘nuisance 

provision’’ that had been approved in 

1984); ‘‘Correction of Implementation 

Plans; American Samoa, Arizona, 

California, Hawaii, and Nevada State 

Implementation Plans,’’ 63 FR 34,641 

(June 27, 1997) (correcting five SIPs by 

deleting a variety of administrative 

provisions concerning variances, 

hearing board procedures, and fees that 

had been approved during the 1970s). 

CAA section 110(k)(6), by its terms— 

specifically, the use of the terms 

‘‘[w]henever’’ and ‘‘may’’ and the lack of 

any time constraints—authorizes, but 

does not require, EPA to make the 

specified finding. As a result, EPA has 

discretion in determining whether and 

when to make the specified finding. See 

New York Public Interest Research 

Group v. Whitman, 321 F.3d 316, 330– 

31 (2d Cir. 2003) (opening phrase 

‘‘Whenever the Administrator makes a 

determination’’ in CAA section 502(i)(1) 

grants EPA ‘‘discretion whether to make 

a determination’’); Her Majesty the 

Queen in Right of Ontario v. EPA, 912 

F.2d 1525, 1533 (DC Cir. 1990) 

(‘‘whenever’’ in CAA section 115(a) 

‘‘impl[ied] a degree of discretion’’ in 

whether EPA had to make a finding). 

(b) Inherent Authority To Reconsider 

The provisions in CAA section 110 

that authorize EPA to take action on a 

SIP revision inherently authorize EPA 

to, on its own initiative, reconsider and 

revise that action as appropriate. The 

courts have found that an administrative 

agency has the inherent authority to 

reconsider its decisions, unless 

Congress specifically proscribes the 

agency’s discretion to do so. See, e.g., 

Gun South, Inc. v. Brady, 877 F.2d 858, 

862 (11th Cir. 1989) (holding that 

agencies have implied authority to 

reconsider and rectify errors even 

though the applicable statute and 

regulations do not provide expressly for 

such reconsideration); Trujillo v. 

General Electric Co., 621 F.2d 1084, 

1086 (10th Cir. 1980) (‘‘Administrative 

agencies have an inherent authority to 

reconsider their own decisions, since 

the power to decide in the first instance 

carries with it the power to reconsider’’); 

see also New Jersey v. EPA, 517 F.3d 

574 (DC Cir. 2008) (holding that an 

agency normally can change its position 

and reverse a prior decision but that 

Congress limited EPA’s ability to 

remove sources from the list of 

hazardous air pollutant source 

categories, once listed, by requiring EPA 

to follow the specific delisting process 

at CAA section 112(c)(9)).4

Section 301(a) of the CAA, read in 

conjunction with CAA section 110 and 

the case law just described, provides 

further statutory authority for EPA to 

reconsider its actions under CAA 

section 110. CAA section 301(a) 

authorizes EPA ‘‘to prescribe such 

regulations as are necessary to carry out 

[EPA’s] functions’’ under the CAA. 

Reconsidering prior rulemakings, when 

necessary, is part of ‘‘[EPA’s] functions’’ 

under the CAA—in light of EPA’s 

inherent authority as recognized under 

the case law to do so—and, as a result, 

CAA section 301(a) confers such 

authority upon EPA. 

EPA finds further support for its 

authority to narrow its approvals in the 

Administrative Procedures Act (APA) 

section 553(e), which requires EPA to 

give interested persons ‘‘the right to 

petition for the issuance, amendment, or 

repeal of a rule,’’ and CAA section 

307(b)(1), which expressly contemplates 

that persons may file a petition for 

reconsideration under certain 

circumstances (at the same time that a 

rule is under judicial review). These 

authorizations for other persons to 

petition EPA to amend or repeal a rule 

suggest that EPA has inherent authority, 

on its own, to issue such amendment or 

repeal. This is because EPA may grant 

a petition from another person for an 

amendment to or repeal of a rule only 

if justified under the CAA, and if such 

an amendment or repeal is justified 

under the CAA, then EPA should be 

considered as having inherent authority 

to initiate the process on its own, even 

without a petition from another person. 

EPA recently used its authority to 

reconsider prior actions and limit its 

prior approval of a SIP in connection 

with California conformity SIPs. See, 

e.g., 68 FR 15,720, 15,723 (discussing 

prior action taken to limit approvals); 67 

FR 69,139 (taking final action to amend 

prior approvals to limit their duration); 

and 67 FR 46,618 (proposing to amend 

prior approvals to limit their duration, 

based on CAA sections 110(k) and 

301(a)). EPA had previously approved 

SIPs with emissions budgets based on a 

mobile source model that was current at 

the time of EPA’s approval. Later, EPA 

updated the mobile source model. But, 

even though the model had been 

updated, emissions budgets would 

continue to be based on the older, 

previously approved model in the SIPs, 

rather than the updated model. To 

rectify this problem, EPA conducted a 

rulemaking that revised the previous 

SIP approvals so that the approvals of 

the emissions budgets would expire 

early, when the new ones were 

submitted by states and found adequate, 

rather than when a SIP revision was 

approved. This helped California more 

quickly adjust its regulations to 

incorporate the newer model. EPA is 

using its authority to reconsider and 

limit its prior approval of SIPs generally 

in the same manner as it did in 

connection with California conformity 

SIPs. 

5. FIPs 

As noted previously, if the state fails 

to submit a required SIP revision, or 

does so but EPA then disapproves that 

SIP revision, then the CAA requires EPA 

to promulgate a FIP and thereby, in 

effect, federalize the part of the air 

pollution control requirements for 

which the state, through the required 

SIP revision, would otherwise have 

been responsible. Specifically, under 

CAA section 110(c)(1), EPA is required 

to: 

promulgate a [FIP] at any time within 2 years 

after the Administrator (A) finds that a State 

has failed to make a required submission 

* * *, or (B) disapproves a [SIP] submission 

in whole or in part, unless the State corrects 

the deficiency, and the Administrator 


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5 In contrast, the ‘‘nonattainment new source 

review (NSR)’’ program applies in areas not in 

attainment of a NAAQS and in the Ozone Transport 

Region and is implemented under the requirements 

of part D of title I of the CAA. We commonly refer 

to the PSD program and the nonattainment NSR 

program together as the major NSR program. The 

EPA rules governing both programs are contained 

in 40 CFR 51.165, 51.166, 52.21, 52.24, and part 51, 

Appendices S and W. There is no NAAQS for CO2

or any of the other well-mixed GHGs, nor has EPA 

proposed any such NAAQS; therefore, unless and 

until we take further such action, the nonattainment 

NSR program does not apply to GHGs. 

6 ‘‘Interpretation of Regulations that Determine 

Pollutants Covered by Clean Air Act Permitting 

Programs.’’ 75 FR 17,004 (April 2, 2010). This action 

finalizes EPA’s response to a petition for 

reconsideration of ‘‘EPA’s Interpretation of 

Regulations that Determine Pollutants Covered by 

Federal Prevention of Significant Deterioration 

(PSD) Permit Program’’ (commonly referred to as the 

‘‘Johnson Memo’’), December 18, 2008. 

7 In the Tailoring Rule, we noted that commenters 

argued, with some variations, that the PSD 

provisions applied only to NAAQS pollutants, and 

not GHGs, and we responded that the PSD 

provisions apply to all pollutants subject to 

regulation, including GHGs. See 75 FR 31,560–62; 

‘‘Prevention of Significant Deterioration and Title V 

GHG Tailoring Rule: EPA’s Response to Public 

Comments,’’ May 2010, pp.38–41. We did not 

reopen that issue in this rulemaking. 

approves the plan or plan revision, before the 

Administrator promulgates such [FIP]. 

Although this provision, by its terms, 

mandates that EPA promulgate a FIP 

under the specified circumstances, and 

mandates that EPA do so within 2 years 

of when those circumstances occur, the 

provision gives EPA discretion to 

promulgate the FIP ‘‘at any time within 

[that] 2 year[]’’ period. Thus, EPA is 

authorized to promulgate a FIP 

immediately after either the specified 

state failure to submit or EPA 

disapproval. 

However, CAA section 110(c)(1), as 

quoted earlier, further provides that if 

EPA delays promulgating a FIP until 

later in the 2-year period, and, in the 

meantime, the state corrects the 

deficiency by submitting an approvable 

SIP revision that EPA approves, then 

EPA is precluded from promulgating the 

FIP. Similarly, once EPA promulgates a 

FIP, it stays on the books until the state 

submits an approvable SIP that EPA 

then approves. 

B. General Requirements for the PSD 

Program 

The PSD program is a preconstruction 

review and permitting program 

applicable, under EPA rules, to large 

new stationary sources and, in general, 

expansions of existing sources. The PSD 

program applies in areas that are 

designated ‘‘attainment’’ or 

‘‘unclassifiable’’ for a NAAQS, and is 

contained in part C of title I of the 

CAA.5 Specifically, under EPA’s 

regulations, PSD applies to a ‘‘major 

stationary source’’ that newly constructs 

or that undertakes a ‘‘major 

modification.’’ 40 CFR 52.166(a)(7), 

(b)(1)(i), (b)(2)(i). A ‘‘major stationary 

source’’ is any source that emits or has 

the potential to emit 100 or 250 tpy or 

more, depending on the source category, 

of any ‘‘regulated NSR pollutant.’’ 40 

CFR 51.166(b)(1)(i)(a). The regulations 

define that term to include four classes 

of air pollutants, including, as a catchall, ‘‘any pollutant that otherwise is 

subject to regulation under the Act.’’ 40 

CFR 51.166(b)(49)(iv). As discussed 

later in this preamble, the phrase 

‘‘subject to regulation’’ began to include 

GHGs on January 2, 2011, under our 

interpretation of that phrase as 

described in the Tailoring Rule, 75 FR 

at 31,580/3, and what we call the 

‘‘Johnson Memo Reconsideration’’ (or 

the ‘‘Timing Decision’’).6

The CAA contemplates that the PSD 

program be implemented by the states 

through their SIPs. CAA section 

110(a)(2)(C) requires that: 

Each implementation plan * * * shall 

* * * include a program to provide for 

* * * 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 part[] C * * * of this 

subchapter. 

CAA section 110(a)(2)(J) requires that: 

Each implementation plan * * * shall 

* * * meet the applicable requirements of 

* * * part C of this subchapter (relating to 

significant deterioration of air quality and 

visibility protection). 

CAA section 161 provides that: 

Each applicable implementation plan shall 

contain emission limitations and such other 

measures as may be necessary, as determined 

under regulations promulgated under this 

part [C], to prevent significant deterioration 

of air quality for such region * * * 

designated * * * as attainment or 

unclassifiable. 

These provisions, read in conjunction 

with the PSD applicability provisions, 

CAA sections 165(a)(1) and 169(1), 

mandate that SIPs include PSD 

programs that are applicable to any air 

pollutant that is subject to regulation 

under the CAA, including, as discussed 

later in this preamble, GHGs as of 

January 2, 2011.7

Most states have EPA-approved SIP 

PSD programs, and as a result, in those 

states, PSD permits are issued by state 

or local air pollution control agencies. 

In states that do not have EPA-approved 

SIP PSD programs, EPA issues PSD 

permits under its own authority, 

although in some cases, EPA has 

delegated such authority to the state or 

local agency. 

1. Applicability of PSD to Non-NAAQS 

Pollutants 

EPA has long held the view that PSD 

applies to ‘‘any pollutant subject to 

regulation under the CAA,’’ and that 

includes non-NAAQS pollutants. EPA’s 

long-standing regulations have 

interpreted CAA section 165(a) broadly 

enough to capture non-NAAQS 

pollutants. A detailed discussion of 

these positions was provided in the 

Tailoring Rule at 75 FR 31,560/3, and in 

the Interim Final Rule at 75 FR 82,443. 

2. Automatic Application of PSD to 

Newly Regulated Pollutants 

Under the PSD applicability 

requirements, PSD applies to sources 

automatically, that is, by operation of 

law, as soon as their emissions of 

pollutants become subject to regulation 

under the CAA. This is because CAA 

section 165(a)(1) prohibits ‘‘major 

emitting facilit[ies]’’ from constructing 

or modifying without obtaining a permit 

that meets the PSD requirements, and 

CAA section 169(1) defines a ‘‘major 

emitting facility’’ as a source that emits 

a specified quantity of ‘‘any air 

pollutant,’’ which, as noted earlier, EPA 

has long interpreted as any pollutant 

subject to regulation. Whenever EPA 

promulgates control requirements for a 

pollutant for the first time, that 

pollutant becomes subject to regulation, 

and any stationary source that emits that 

pollutant in sufficient quantities 

becomes a ‘‘major emitting facility’’ that, 

when it constructs or modifies, becomes 

subject to PSD without any further 

action from EPA or a state or local 

government. 

EPA regulations have long codified 

automatic PSD applicability. See 43 FR 

26,380, 26403/3, 26406 (June 19, 1978) 

(promulgating 40 CFR 51.21(b)(1)(i)) and 

42 FR 57,479, 57,480, 57,483 (November 

3, 1977) (proposing 40 CFR 

51.21(b)(1)(i)) (applying PSD 

requirements to a ‘‘major stationary 

source’’ and defining that term to 

include sources that emit specified 

quantities of ‘‘any air pollutant regulated 

under the Clean Air Act’’). Most 

recently, in the 2002 NSR Reform Rule, 

EPA reiterated these requirements, 

although changing the terminology to 

‘‘any regulated NSR pollutant.’’ 67 FR 

80,186. EPA stated in the preamble: 

‘‘The PSD program applies automatically 

to newly regulated NSR pollutants, 

which would include final 

promulgation of an NSPS applicable to 

a previously unregulated pollutant.’’ 67 

FR at 80,240/1. 

In most states with approved PSD 

programs, PSD does apply 

automatically. However, in a minority of 


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8 75 FR at 53,897/3 (proposed GHG PSD SIP call). 

9This history is described in ‘‘Approval and 

Promulgation of Implementation Plan, State of 

Texas; Prevention of Significant Deterioration— 

Final rulemaking, 57 FR 28,093, 28,094 (June 24, 

1992); ‘‘Approval and Promulgation of 

Implementation Plan, State of Texas; Prevention of 

Significant Deterioration—Proposed rulemaking, 54 

FR 52,823, 52,824 (December 22, 1989). 

10See, e.g., 48 FR 60236,023 (February 9, 1983). 

11Letter from Jack S. Divita, U.S EPA, Region 6, 

to Roger Wallis, Texas Air Control Board (December 

23, 1980), p. 2. In that letter, EPA objected to 

Texas’s proposed definitions of the terms ‘‘major 

facility/stationary source’’ and ‘‘major modification’’ 

on grounds they are not equivalent to the definition 

of those terms in EPA’s PSD and nonattainment 

NSR regulations because Texas’s proposed 

definitions — 

include only those stationary sources and 

modifications with emissions of air contaminants 

for which a [NAAQS] has been issued. Under the 

PSD and [nonattainment] NSR requirements, 

[Texas’s] definitions must include sources with 

emissions of ‘‘any air pollutant subject to regulation 

under the Act.’’ * * * Since the proposed 

definitions would exclude PSD and [nonattainment] 

NSR coverage for those sources emitting pollutants 

subject to regulations under the Act, but for which 

a NAAQS has not been issued, they are not 

equivalent to the federal definitions of ‘‘major 

stationary source’’ and ‘‘major modification.’’ 

Id. (emphasis in original). 

12Environmental Protection Agency—Region 6, 

‘‘EPA Review of Texas Revisions to the General 

Rules and Regulations VI,’’ p. 4 (August 1983), cited 

in 48 FR 55,483/1 & n.1 (December 13, 1983). 

13For convenience, we will use the acronym 

‘‘IBR’’ for the various grammatical usages of 

incorporate by reference, including the noun form, 

i.e., IBR, for incorporation by reference; as well as 

the verb form, e.g., IBR’d, for incorporated by 

reference. 

14As also discussed elsewhere, this is a 

narrowing interpretation of the PSD applicability 

requirements in CAA section 169(1), which, read 

literally, apply PSD to ‘‘any air pollutant.’’ 

15TACB Board Order No. 85–7 (July 26, 1985). 

states with approved PSD programs, it 

does not.8 Instead, each time EPA 

subjects a previously unregulated air 

pollutant to regulation, these states must 

submit a SIP revision incorporating that 

pollutant into their programs. Despite 

the time needed for the state to submit 

a SIP revision and EPA to approve it, 

the pollutant-emitting sources in the 

state become subject to PSD under the 

CAA as soon as EPA first subjects that 

pollutant to control. Because under 

CAA section 165(a)(1) and 169(1), as 

interpreted by EPA, a source that emits 

specified quantities of any air pollutant 

subject to regulation cannot construct or 

modify unless it first receives a PSD 

permit, as a practical matter, in a state 

with an approved PSD program that 

does not automatically update and that 

has not been revised to include the 

newly regulated pollutant, the sources 

may find themselves subject to the CAA 

requirement to obtain a permit, but 

without a permitting authority to issue 

that permit. As discussed later, this 

action is needed because GHG-emitting 

sources in Texas would otherwise 

confront that situation. 

In a recent decision, the U.S. Court of 

Appeals for the 7th Circuit (7th Circuit), 

mistakenly citing to PSD provisions 

when the issue before the court 

involved the separate and different nonattainment provisions of CAA sections 

171–193, concluded that sources could 

continue to abide by permitting 

requirements in an existing SIP until 

amended, even if that SIP does not 

comport with the law. United States v. 

Cinergy Corp., No. 09–3344, 2010 WL 

4009180 (7th Cir. Oct. 12, 2010). In stark 

contrast to the nonattainment provisions 

actually at issue in Cinergy—which are 

not self-executing and must therefore be 

implemented through a SIP — PSD is 

self-executing; it is the statute (CAA 

section 165), not just the SIP, that 

prohibits a source from constructing a 

project without a permit issued in 

accordance with the Act. 

C. Regulatory Background: Texas SIP 

and PSD Program 

1. Texas’s Initial Attainment SIP 

Revision 

In 1972, shortly after the enactment of 

the 1970 CAA Amendments, Texas 

submitted to EPA its SIP to attain and 

maintain the NAAQS that EPA had 

promulgated by that time. As part of 

that SIP revision, Texas provided 

assurances that it had legal authority to 

carry out the SIP, in accordance with 

the predecessor to CAA section 

110(a)(2)(E)(i). EPA approved Texas’s 

SIP, including the assurances of legal 

authority, by notice dated May 31, 1972. 

37 FR 10,842. 

2. Texas Initial PSD SIP Revision 

In the 1977 CAA Amendments, 

Congress enacted the PSD program. In 

the immediate aftermath, EPA acted as 

the PSD permitting authority in the 

states, but EPA began to delegate to 

various state authorities all or part of 

EPA’s authority to issue PSD permits. In 

addition, at this time, EPA revised its 

pre-existing regulations, which had 

established a preconstruction permitting 

program, to conform to the 1977 CAA 

requirements. Each state was required to 

adopt a PSD program and submit it for 

approval as a SIP revision, and, if the 

PSD program met CAA requirements, 

EPA approved the program, and the 

state then became the PSD permitting 

authority. This process occurred for 

most of the states in the nation, 

including Texas. A brief history of 

Texas’s initial PSD SIP approval 

follows.9

a. Texas’s Receipt of Delegation 

Authority for the PSD Program 

Beginning in 1980, when EPA was 

still the permitting authority for 

Federally required PSD permits in 

Texas, the State requested delegation of 

certain aspects of the Federal PSD 

program, and in a series of actions, EPA 

granted that authority.10 During this 

time, Texas also revised its state—i.e., 

Texas Air Control Board (TACB)—PSD 

regulations. EPA commented on an 

early set of proposed revisions to TACB 

regulations by letter dated December 23, 

1980 and made clear that PSD applies 

to non-NAAQS pollutants.11 EPA 

reiterated these statements to Texas in 

1983.12

b. Texas’s SIP PSD Program 

During 1985–1988, Texas submitted a 

series of SIP revisions comprising its 

PSD program to EPA for approval. In 

these SIP revisions, Texas established 

key components of its PSD rules by 

incorporating by reference EPA’s PSD 

rules found in 40 CFR 52.21. Of most 

importance for present purposes, Texas 

incorporated by reference (IBR’d) EPA’s 

PSD applicability regulations in 52.21.13

Under EPA’s regulations, as then 

written, PSD applied to ‘‘any pollutant 

subject to regulation under the [Clean 

Air] Act.’’ 40 CFR 52.21(b)(1)(i)) (1985– 

1988). It bears emphasis that this 

provision, by its terms, applied PSD to 

each and every air pollutant subject to 

regulation under the CAA, which, as 

discussed elsewhere, has been EPA’s 

consistent interpretation of the CAA 

requirements for PSD applicability. 

CAA section 165(a)(1), 169(1).14

(1) Incorporation by Reference 

In adopting a particular SIP revision 

that IBR’d EPA’s regulations, however, 

Texas intended that IBR to apply to only 

the EPA regulations as they read as of 

the date that Texas adopted the SIP 

revision. Texas did not intend that IBR 

in that SIP revision to apply to 

subsequent revisions to those 

regulations. This became readily 

apparent during the course of EPA’s 

review of Texas’s SIP revisions. The 

TACB adopted the first SIP revision on 

July 26, 1985.15 This SIP revision 

consisted, in relevant part, of a revision 

to TACB Regulation VI—§ 116.3.(a) to 

add subparagraph (13), which read, in 

relevant part, 

(13) The proposed facility shall comply 

with the Prevention of Significant 

Deterioration of Air Quality regulations 

promulgated by the [EPA] in the Code of 

Federal Regulations at 40 CFR 52.21 as 

amended * * *, hereby incorporated by 


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16 Id. 

17Letter from Mark White, Governor of Texas, to 

Lee M. Thomas, Administrator of U.S. EPA, 

December 11, 1985. 

18Letter from William B. Hathaway, Director, Air, 

Pesticides and Toxics Division, EPA Region 6, to 

Allen Eli Bell, Executive Director, TACB (July 3, 

1986). Specifically, EPA stated—State’s authority to 

IBR Federal rules prospectively—The Board 

approved and signed the incorporation of the PSD 

regulations on July 26, 1985, An amendment to the 

Federal PSD regulations [40 CFR 52.21(o)(3), p(1) 

and p(3)] occurred on July 12, 1985. However, the 

TACB proposed to adopt the Federal regulations 

and carried out the public participation process 

before the July 12, 1985, promulgation date of the 

amendments. We need a legal analysis from the 

state concerning the TACB’s legal authority to 

incorporate by reference the federal rules 

prospectively. We recognize that the proposed 

federal rules were unchanged on the final 

promulgation; however, the Texas Water 

Commission believes that the state cannot adopt 

prospective Federal rules under the State laws. We 

would appreciate a legal clarification on this 

subject. If the State did not intend prospective 

adoption, the rules should be clarified by 

referencing the appropriate date. 

Id. p. 2 and Enclosure p. 5. 

19Letter from Steve Spaw, Deputy Executive 

Director, TACB, to William B. Hathaway, Director, 

Air, Pesticides and Toxics Division, EPA Region 6 

(October 24, 1986). 

20 Id. 1–2. 

21TACB Board Order No. 87–09 (July 17, 1987). 

See 12 Tex. Reg. 2575/2 (August 7, 1987) 

(discussing revision to section 116.3(a)(13) in 

response to request from U.S. EPA). 

22Letter from William P. Clements, Jr., Governor 

of Texas, to Lee M. Thomas, Administrator of U.S. 

EPA (October 26, 1987). 

23 52 FR 24,634 (July 1, 1987). 

24TACB Board Order No. 88–08 (July 15, 1988). 

25Letter from William P. Clements, Jr., Governor 

of Texas, to Lee M. Thomas, Administrator of U.S. 

EPA (September 29, 1988). 

26TACB Board Order No. 88–08 (July 15, 1988). 

27 54 FR 52,823. 

28 57 FR 28,093. 

29 57 FR 28,093, 28,094/2 (June 24, 1992) (final 

rule); 54 FR 52,823, 52,824/1 (December 22, 1989) 

(proposed rule); Technical Support Document: 

Texas State Implementation Plan for Prevention of 

Significant Deterioration, U.S. Environmental 

Protection Agency, 4 (November 28, 1988). 

Moreover, Texas submitted another SIP revision on 

February 18, 1991, to change the date in section 

116.3(a)(13) from ‘‘August 1, 1987’’ to ‘‘October 17, 

1988’’ to reflect the amendments to 40 CFR 52.21 

as promulgated in the Federal Register on October 

17, 1988 (53 FR 40,656) (Nitrogen Oxides PSD 

increments). EPA did not act on this SIP revision 

when it approved the Texas PSD program on June 

24, 1992, but did approve this SIP revision later, on 

September 9, 1994 (59 FR 46,556). See 62 FR 

44,084/2. 

30 It should be noted that although Texas 

subsequently made certain commitments, discussed 

below, none of those commitments, on its face, 

suggested that Texas’s PSD SIP should be 

interpreted to automatically update to incorporate 

a pollutant newly subject to regulation. 

31Following EPA approval of Texas’s PSD 

program, Texas has occasionally submitted SIP 

revisions to update its PSD program to 

accommodate further EPA regulatory revisions. See, 

e.g., 69 FR 43,752, 43,753 (July 22, 2004). 

reference, except for [certain identified] 

paragraphs [not here relevant].16

The TACB submitted this SIP revision 

to EPA on December 11, 1985.17 EPA 

responded with a letter to Texas, dated 

July 3, 1986, commenting on several 

aspects of the SIP revision, including 

inquiring whether the state had 

authority to IBR Federal rules 

prospectively, asking for ‘‘legal 

clarification’’ on the subject, and 

recommending that if the TACB did not 

have such authority, then the TACB 

should clarify the IBR by ‘‘referencing 

the appropriate date.’’ 18

Texas responded with a letter dated 

October 24, 1986,19 in which it stated: 

An issue of concern * * * is whether the 

[TACB] intended to incorporate by reference 

Federal rules prospectively in the PSD rule 

§ 116.3(a)(13) and in the stack height rule 

§ 116.3(a)(14). [A]lthough our intention was 

not prospective rulemaking and we do not 

believe the rule language implies such, we 

have no specific objection to including the 

date of Federal adoption of any Federal 

material adopted by reference by the TACB 

in future SIP revisions (including the 

proposed PSD and stack height revisions). By 

initiating the public hearing process for PSD 

rules again (to incorporate requested 

revisions), Federal PSD regulations amended 

on July 12, 1985 will be subject to the state 

public participation process. This should 

eliminate the concern expressed in your July 

3, 1986 letter.20

Accordingly, on July 17, 1987, the 

TACB adopted a revision to its PSD 

rule, § 116.3(a)(13), so that the rule 

continued to IBR EPA’s PSD regulatory 

requirements at 40 CFR 52.21, but 

referenced the date of November 7, 

1986.21 Texas submitted that as a SIP 

revision to EPA on October 26, 1987.22

However, some 8 months later, by 

notice published on July 1, 1987, EPA 

adopted the PM10 NAAQS,23 and 

thereby subjected to PSD sources 

emitting PM10. Recognizing this, the 

TACB, on July 15, 1988, adopted still 

another revision to its PSD rule to 

change the referenced date to August 1, 

1987, and thereby incorporated EPA’s 

application of PSD to PM10-emitting 

sources into Texas’s PSD program.24

Texas submitted that revised rule to 

EPA as a SIP revision on September 29, 

1988.25 As so revised, the Texas PSD 

rule (again, § 116.3(a)(13)) read, in 

relevant part, as follows: 

(13) The proposed facility shall comply 

with the Prevention of Significant 

Deterioration (PSD) of Air Quality regulations 

promulgated by the Environmental 

Protection Agency (EPA) in the Code of 

Federal Regulations at 40 CFR 52.21 as 

amended August 1, 1987 * * *, except for 

[certain identified] paragraphs [not here 

relevant].26

EPA proposed to approve this SIP 

revision, with this iteration of the Texas 

PSD rule, by notice dated December 22, 

1989,27 and EPA issued a final approval 

by notice dated June 24, 1992.28 In the 

preambles to the proposed and final 

rules, and in supporting documents, 

EPA recounted part of this history of 

Texas revising its regulations to IBR the 

current EPA regulatory requirements.29

This history shows that both EPA and 

Texas were well aware that Texas’s 

method of incorporating by reference 

EPA’s regulatory requirements into 

Texas’s PSD rule was not prospective 

and therefore did not automatically 

update to incorporate a pollutant newly 

subject to regulation.30 In fact, during 

the time that EPA was reviewing Texas’s 

PSD SIP, Texas revised its SIP to apply 

PSD to PM10, which EPA subjected to 

regulation for the first time during that 

time. However, after stating simply that 

it does not intend prospective IBR, 

Texas did not explicitly address this 

issue. That is, Texas did not 

acknowledge that following approval of 

Texas’s PSD program, EPA could well 

subject to regulation additional 

pollutants—whether through a revised 

NAAQS or regulation under another 

CAA provision—and Texas did not 

discuss how it would respond.31 Simply 

put, Texas failed to look down the road 

and address a problem with its PSD 

SIP—the mechanism for applying PSD 

to pollutants newly subject to 

regulation—that was bound to recur. 

(2) Legal Authority 

The record of Texas’s PSD program 

includes limited references to, or 

discussion of, legal authority that may 

be relevant to whether Texas provided 

assurances that it had adequate legal 

authority to apply PSD to pollutants 

newly subject to regulation. The 

following merit review: 

First, in adopting and submitting the 

PSD SIP revisions, the TACB—the 

agency charged with taking that 

action—relied on its general legal 

authority to adopt and submit the SIP 

revisions. The TACB adopted regulatory 

amendments through ‘‘Board Orders,’’ 

and then submitted those Board Orders 

to EPA as SIP revisions. The Board 

Orders typically cited general authority 

under the Texas CAA. One example is 

TACB Board Order No. 88–08 (July 15, 

1988), which revised the Texas PSD rule 

to provide a later date for IBR’ing EPA’s 

PSD program, and which comprised one 

of the SIP revisions that formed the 

basis for the Texas PSD program that 

EPA approved by notice dated June 24, 

1992 (57 FR 28,093). This Board Order 

provides, in relevant part, ‘‘Section 

3.09(a) of the Texas CAA gives the 

Board authority to make rules and 

regulations consistent with the general 

intent and purposes of the Act and to 


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32Letter from A. Stanley Meiburg, Director, Air, 

Pesticides & Toxics Division, EPA Region 6, to 

Steve Spaw, Executive Director, TACB (March 30, 

1992). 

33Letter from Steve Spaw, Executive Director, 

TACB, to A. Stanley Meiburg, Director, Air, 

Pesticides and Toxics Division, EPA Region 6 (April 

17, 1992). 

34Technical Support Document: Texas State 

Implementation Plan for Prevention of Significant 

Deterioration, U.S. Environmental Protection 

Agency, 6 (November 28, 1988). 

35Letter from Allen Eli Bell, Executive Director, 

Texas Air Control Board to Robert Layton Jr., 

Regional Administrator, U.S. EPA (September 5, 

1989) 1 (Texas’s Commitments Letter). 

amend any rule or regulation it makes’’ 

and ‘‘the Board hereby certifies that the 

amendments as adopted have been 

reviewed by legal counsel and found to 

be a valid exercise of the Board’s legal 

authority.’’ Board Order No. 88–08, page 

2. 

Second, the 1990 CAA Amendments 

amended CAA section 169(1) to add 

another type of source that was subject 

to PSD: Large municipal combustors. 

Shortly after the 1990 amendments, and 

before issuing final approval for the 

Texas PSD program, EPA asked Texas 

for assurances that its PSD program 

would apply to large municipal waste 

combustors. In a March 30, 1992, letter, 

EPA stated the following: 

Since we proposed approval of this SIP 

before enactment of the 1990 Clean Air Act 

Amendments (CAAA), it is necessary that we 

address several issues in the final approval 

notice in order to be in conformance with the 

CAAA. 

* * * * * 

Municipal Waste Combustion—Section 

169(1) is amended by expanding the list of 

major emitting facilities that are subject to 

PSD requirements if they emit or have the 

potential to emit 100 tons per year or more 

of any regulated pollutant. This list now 

includes municipal incinerators capable of 

charging more than fifty tons of refuse per 

day. This requirement has been effective 

since November 15, 1990, for all applicable 

PSD sources. In the conference call [with 

EPA Region 6], the * * * TACB * * * legal 

representative said that the TACB has the 

existing legal authority, and can and will be 

reviewing such sources for PSD applicability 

and permitting.32

Thus, according to this letter, Texas 

provided oral statements in a conference 

call with EPA Region 6 that Texas has 

legal authority to apply its state PSD 

rules to large municipal waste 

combustors. 

Texas responded in a letter dated 

April 17, 1992: 

We understand that you need confirmation 

in several areas to conform with the 

requirements of the 1990 Federal Clean Air 

Act Amendment * * * before the final 

delegation will be made. 

* * * * * 

We will address as a major source subject 

to PSD review, municipal waste combustors 

capable of cha[n]ging more than 50 tons of 

refuse per day as one of the sources subject 

to PSD review if they emit or have the 

potential to emit 100 tons per year or more 

of any regulated pollutant.33

Although the TACB Board Order 

referred to the TACB’s general legal 

authority, the record reveals no 

discussion or assurances that this legal 

authority was adequate to apply PSD to 

pollutants newly subject to regulation. 

Similarly, the oral assurance that the 

TACB apparently provided that it had 

legal authority to apply PSD to large 

municipal combustors, as required 

under the then-newly enacted 1990 

CAA Amendments, does not address 

whether Texas had adequate authority 

to apply PSD to each pollutant that EPA 

newly subjects to regulation. 

(3) Texas’s Commitments 

The rulemaking record of EPA’s 

approval of Texas’s PSD SIP shows that 

Texas provided two commitments that 

are relevant for present purposes: 

(a) 1987 Texas PSD Commitments 

Statement 

The TACB adopted revisions to TACB 

Regulation VI on July 17, 1987, which 

the Governor submitted on October 27, 

1987. Those revisions included the 

following statement, which we call the 

1987 Texas PSD Commitments 

Statement: 

Revision To The Texas State 

Implementation Plan For Prevention Of 

Significant Deterioration Of Air Quality 

The Texas Air Control Board (TACB) will 

implement and enforce the Federal 

requirements for Prevention of Significant 

Deterioration of Air Quality (PSD) as 

specified in 40 CFR 51.166(a) by requiring all 

new major stationary sources and major 

modifications to obtain air quality permits as 

provided in TACB regulation VI, Control of 

Air Pollution by Permits for New 

Construction and Modification. In addition, 

the TACB will adhere to the following 

conditions in the implementation of the PSD 

program: 

* * * * * 

4. Plan assessment 

The TACB will review the adequacy of the 

Texas PSD plan on an annual basis and 

within 60 days of the time information 

becomes available that an applicable 

increment may be violated. If the TACB 

determines that an increment is being 

exceeded due to the violation of a permit 

condition, appropriate enforcement action 

will be taken to stop the violation. If an 

increment is being exceeded due to a 

deficiency in the state PSD plan, the plan 

will be revised and the revisions will be 

subject to public hearing. 

This 1987 Texas PSD Commitments 

Statement does not specifically address 

the application of PSD to pollutants 

newly subject to regulation. The first 

paragraph, as quoted previously in this 

preamble, commits TACB to require ‘‘all 

new major stationary sources and major 

modifications to obtain air quality 

permits as provided in TACB regulation 

VI * * *,’’ but this does not commit 

TACB to address pollutants newly 

subject to regulation. Instead, this limits 

the TACB requirement to application of 

PSD to sources ‘‘as provided in TACB 

regulation VI,’’ and that regulation VI 

does not automatically update. As for 

‘‘4, Plan assessment,’’ although the first 

sentence calls for the TACB to review 

the adequacy of the Texas PSD plan on 

an annual basis, and although the rest 

of the provision requires a plan revision 

if an increment violation is determined 

to result from a deficiency in the plan, 

this does not address what happens 

when a new pollutant becomes subject 

to regulation and does not require a plan 

revision to apply to the new pollutant. 

The fact that Texas agreed to revise the 

plan if the plan is found to be deficient 

and that deficiency results in an 

increment being exceeded serves to 

highlight the lack of any comparable 

focus on how the plan would deal with 

pollutants newly subject to regulation. 

EPA’s technical support document 

supporting its proposed approval stated, 

with respect to this 1987 Texas PSD 

Commitments Statement: 

The ‘‘Revision to Texas State 

Implementation Plan for Prevention of 

Significant Deterioration of Air Quality’’ 

specifies how the TACB will fulfill the 

requirements of 40 CFR 51.166(a), plan 

revisions, and plan assessment. The EPA has 

reviewed the State’s commitment and has 

determined that the TACB has addressed the 

continuous plan revisions and assessments 

adequately.34

This general discussion by EPA does not 

indicate that EPA considered the Texas 

statement to apply to pollutants newly 

subject to regulation. 

(b) 1989 Texas Commitment Letter 

In 1989, as EPA considered Texas’s 

SIP revision submittal, EPA became 

concerned that a Texas official had 

made statements that led EPA to 

question whether Texas would adhere 

to EPA’s interpretation that Best 

Available Control Technology (BACT) 

must be implemented through the TopDown process.35 Accordingly, EPA 

advised Texas that EPA would not 

approve Texas’s PSD program unless 

Texas provided a letter assuring EPA 

that Texas would follow EPA 

requirements in general, and 

particularly with respect to the 

interpretation of BACT. Texas provided 


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36Texas’s 1989 Commitments Letter, p. 1. 

37Sic: the word ‘‘to’’ should be between ‘‘forward’’ 

and ‘‘approval’’. 

38Texas’s 1989 Commitments Letter, p. 1. 

39 54 FR 52,823. 

this letter, which we call the Texas PSD 

Commitments Letter, on September 5, 

1989.36 In this letter, Texas 

acknowledged EPA’s concern that a 

Texas official had— 

indicated a lack of intent to follow Federal 

interpretations of the Clean Air Act and 

Environmental Protection Agency (EPA) 

operating policies, most specifically, the 

‘‘Top-Down’’ approach for Best Available 

Control Technology (BACT) analysis in 

reviewing PSD permit applications. 

Texas went on to state: 

[Y]ou may be assured that the position of 

the [Texas Air Control Board (TACB)] is, and 

will continue to be, to implement EPA 

requirements relative to programs for which 

we have received State Implementation Plan 

approval, and to do so as effectively as 

possible. * * * Again, the TACB is 

committed to the implementation of EPA 

decisions regarding PSD program 

requirements. We look forward 37 approval of 

the PSD revisions and believe EPA will find 

the management of that program in Texas to 

be capable and effective.38

By notice dated December 22, 1989, 

EPA proposed to fully approve Texas’s 

PSD program.39 In this proposal, EPA 

focused on the issue of how EPA’s 

current and future interpretations of 

PSD statutory requirements would be 

reflected in the state-implemented 

program. EPA stated: 

In adopting the Clean Air Act, Congress 

designated EPA as the agency primarily 

responsible for interpreting the statutory 

provisions and overseeing their 

implementation by the states. The EPA must 

approve state programs that meet the 

requirements of 40 CFR 51.166. Conversely, 

EPA cannot approve programs that do not 

meet those requirements. However, PSD is by 

nature a very complex and dynamic program. 

It would be administratively impracticable to 

include all statutory interpretations in the 

EPA regulations and the SIPs of the various 

states, or to amend the regulations and SIPs 

every time EPA interprets the statute or 

regulations or issues guidance regarding the 

proper implementation of the PSD program, 

and the Act does not require EPA to do so. 

Rather, action by the EPA to approve this 

PSD program as part of the SIP will have the 

effect of requiring the state to follow EPA’s 

current and future interpretations of the Act’s 

PSD provisions and EPA regulations, as well 

as EPA’s operating policies and guidance (but 

only to the extent that such policies are 

intended to guide the implementation of 

approved state PSD programs). Similarly, 

EPA approval also will have the effect of 

negating any interpretations or policies that 

the state might otherwise follow to the extent 

they are at variance with EPA’s interpretation 

and applicable policies. Of course, any 

fundamental changes in the administration of 

PSD would have to be accomplished through 

amendments to the regulations in 40 CFR 

52.21 and 51.166, and subsequent SIP 

revisions. 

54 FR 52,824/2–3. 

EPA went on to state that it was 

basing its proposed approval of Texas’s 

PSD program on Texas’s agreement, as 

contained in the September 5, 1989, 

letter, that Texas would ‘‘implement that 

PSD SIP approved program in 

compliance with all of the EPA’s 

statutory interpretations and operating 

policies.’’ 54 FR 82,825/2. EPA stated— 

* * * EPA’s approval of the Texas PSD SIP 

requires the state to follow EPA’s statutory 

interpretations and applicable policies[], 

including those concerning [BACT]. * * * 

In support of the discussion above, the 

Executive Director of the TACB has 

submitted a letter, dated September 5, 1989, 

which commits the TACB to implement the 

PSD SIP approved program in compliance 

with all of the EPA’s statutory interpretations 

and operating policies. Specifically, the 

TACB’s letter states that (1) ‘‘* * * you may 

be assured that the position of the agency is, 

and will continue to be, to implement EPA 

requirements relative to programs for which 

we have received [SIP] approval, and to do 

so as effectively as possible * * *’’, and (2) 

‘‘* * * the TACB is committed to the 

implementation of the EPA decisions 

regarding PSD program requirements * * *’’. 

The EPA has evaluated the content of this 

letter and has determined that the letter 

sufficiently commits the TACB to carry out 

the PSD program in accordance with the 

Federal requirements as set forth in the 

[CAA] applicable regulations, and as further 

clarified in the EPA’s statutory and 

regulatory interpretations, including the 

proper conduct of BACT analyses. The EPA 

also interprets this letter as committing the 

TACB to follow applicable EPA policies such 

as the ‘‘Top-Down’’ approach. This letter will 

be incorporated into the SIP upon the final 

approval action. 

54 FR 52,825/1–2. 

EPA issued a final rule to give full 

approval to the program by notice dated 

June 24, 1992, 57 FR 28,093. In the final 

rule, EPA indicated that it had received 

adverse comments concerning its 

statements in the proposal that Texas 

was required to adopt all of EPA’s 

interpretations of the PSD requirements. 

Accordingly, EPA refined its views. EPA 

stated: 

Comment 1: The commenters expressed 

concern with the preamble language in the 

proposal notice, suggesting that final 

approval would require that the State follow 

EPA’s current and future interpretations of 

the Act’s PSD provisions and EPA 

regulations as well as EPA’s operating 

policies and guidance. The commenter 

contended that such a condition would be 

unlawful * * * and would improperly limit 

the State’s flexibility * * *. 

Response 1: The EPA did not intend to 

suggest that Texas is required to follow EPA’s 

interpretations and guidance issued under 

the Act in the sense that those 

pronouncements have independent status as 

enforceable provisions of the Texas PSD SIP, 

such that mere failure to follow such 

pronouncements, standing alone, would 

constitute a violation of the Act. As clarified 

herein, EPA’s intent is merely to place the 

State and the public on notice of EPA’s 

longstanding views that the Agency must 

continue to oversee the State’s 

implementation of the PSD SIP * * *. 

* * * Texas and other states [have] 

considerable discretion to implement the 

PSD program as they see fit. 

* * * PSD–SIP approved states remain 

free to follow their own course, provided that 

state action is consistent with the letter and 

spirit of the SIP, when read in conjunction 

with the applicable statutory and regulatory 

provisions. 

* * * 

Comment 4: One commenter noted that the 

TACB’s letter, dated September 5, 1989, 

cannot reasonably be interpreted as a legal 

requirement that the State follow the EPA’s 

present and future new source review 

interpretations, policies and guidance, 

including the BACT ‘‘Top-Down’’ approach, 

because it only commits Texas to implement 

properly established EPA requirements and 

legally-binding EPA decisions. The 

commenter said that the Clean Air Act 

specifically requires that, if at all, any such 

change in EPA policy for BACT 

determinations be accomplished through 

notice and comment rulemaking, and that the 

EPA first prepare an economic impact 

assessment. 

Response 4: In certain circumstances, 

EPA’s approval of a SIP revision through 

notice-and-comment rulemaking procedures 

can serve to adopt specific interpretations or 

decisions of the Agency. For example, a state 

may commit in writing to follow particular 

EPA interpretations or decisions in 

administering the PSD program. As part of 

the SIP revision process, EPA may 

incorporate that State’s commitment into the 

SIP by reference. This process has been 

followed in today’s action. Of course, EPA 

agrees with the commenter that the Agency 

must act reasonably in construing the terms 

of a commitment letter, so as to avoid 

approving it in a manner that would 

contravene the state’s intent in issuing the 

letter in the first place. Moreover, the State 

commitment must be consistent with the 

plain language of the applicable statutory or 

regulatory provisions at issue. Similarly, EPA 

cannot unilaterally change the clear meaning 

of any approved SIP provision by later 

guidance or policy. Rather, as stated in the 

proposed approval notice, such fundamental 

change must be accomplished through the 

SIP revision process. 

Consistent with the terms of the TACB 

letter dated September 5, 1989, EPA views 

that letter as a commitment on the part of the 

TACB to ‘‘implement EPA program 

requirements * * * as effectively as 

possible,’’ and as a commitment ‘‘to the 

implementation of the EPA decisions 

regarding PSD program requirements.’’ EPA 


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40See ‘‘Technical Support Document (TSD): State 

of Texas State Implementation Plan for Prevention 

of Significant Deterioration’’ (November 28, 1988). 

41 ‘‘Prevention of Significant Deterioration (PSD) 

and Nonattainment New Source Review (NNSR): 

Baseline Emissions Determination, Actual-toFuture-Actual Methodology, Plantwide 

Applicability Limitations, Clean Units, Pollution 

Control Projects—Final Rule,’’ 67 FR 80,186 

(December 31, 2002) (NSR Reform rule). 

42 75 FR 56,424 (September 15, 2010). 

43 ‘‘Endangerment and Cause or Contribute 

Findings for Greenhouse Gases Under Section 

202(a) of the Clean Air Act.’’ 74 FR 66,496 

(December 15, 2009). 

agrees, however, that the TACB letter need 

not be interpreted as a specific commitment 

by the State to follow a ‘‘Top-Down’’ 

approach to BACT determinations. 

57 FR 28,095/1–2; 28,096/1. 

As for the fact that Texas’s PSD 

program was limited to pollutants that 

were regulated as of the date Texas 

adopted the program as a SIP revision, 

but did not automatically apply to 

newly regulated pollutants, the 

preamble to the final rule alluded to this 

limitation: 

The State’s regulation VI requires review 

and control of air pollution from new facility 

construction and modification and allows the 

TACB to issue permits for stationary sources 

subject to this regulation. Section 

116.3(a)(13) of the TACB Regulation VI 

incorporates by reference the Federal PSD 

regulations (40 CFR 52.21) as they existed on 

August 1, 1987, which include revisions 

associated with the July 1, 1987, 

promulgation of revised National Ambient 

Air Quality Standards for particulate matter 

(52 FR 24872) and the visibility NSR 

requirements noted above. 

57 FR 28,094. 

However, there is no indication in the 

preamble for the final rule that (i) Texas 

specifically addressed the requirement 

that its PSD program apply to pollutants 

newly subject to PSD, including nonNAAQS pollutants, or (ii) Texas 

provided assurances that it had 

adequate authority under State law to 

carry out the PSD program, including 

applying PSD to pollutants newly 

subject to regulation, among them nonNAAQS pollutants. Nor is there any 

indication that EPA asked Texas to do 

so.40

As discussed previously, in 1996 EPA 

proposed, and in 2002 finalized, what 

we call the NSR Reform Rule,41 which 

included a set of amendments to the 

PSD provisions that included revisions 

to conform to the 1990 CAA 

Amendments. See 61 FR 38,250 (July 

23, 1996), 67 FR 80,186 (December 31, 

2002). The NSR Reform Rule revised the 

terminology for PSD applicability. In 

2006, Texas submitted a SIP revision to 

incorporate the NSR Reform Rule into 

its PSD program, including revising its 

applicability provisions. EPA 

disapproved this SIP revision by notice 

dated September 15, 2010.42

Accordingly, the applicable Texas PSD 

applicability provisions remain the ones 

in the state’s currently approved SIP. 

D. Regulatory Background: GHG Rules 

1. GHGs and Their Sources 

As discussed in detail in the rule EPA 

calls the ‘‘Endangerment Finding,’’ 43

greenhouse gases trap the Earth’s heat 

that would otherwise escape from the 

atmosphere into space, and form the 

greenhouse effect that helps keep the 

Earth warm enough for life. Greenhouse 

gases are naturally present in the 

atmosphere and are also emitted by 

human activities. Human activities are 

intensifying the naturally occurring 

greenhouse effect by increasing the 

amount of GHGs in the atmosphere, 

which is changing the climate in a way 

that endangers human health, society, 

and the natural environment. 

Some GHGs, such as carbon dioxide 

(CO2), are emitted to the atmosphere 

through natural processes as well as 

human activities. Other gases, such as 

fluorinated gases, are created and 

emitted solely through human activities. 

The well-mixed GHGs of concern 

directly emitted by human activities 

include CO2, methane (CH4), nitrous 

oxide (N2O), hydrofluorocarbons 

(HFCs), perfluorocarbons (PFCs), and 

sulfur hexafluoride (SF6). These six 

GHGs will, for the purposes of this final 

rule, be referred to collectively as ‘‘the 

six well-mixed GHGs,’’ or, simply, 

GHGs, and together constitute the ‘‘air 

pollutant’’ upon which the GHG 

thresholds in the Tailoring Rule are 

based. These six gases remain in the 

atmosphere for decades to centuries 

where they become well-mixed globally 

in the atmosphere. When they are 

emitted more quickly than natural 

processes can remove them from the 

atmosphere, their concentrations 

increase, thus increasing the greenhouse 

effect. The heating effect caused by the 

human-induced buildup of GHGs in the 

atmosphere is very likely the cause of 

most of the observed global warming 

over the last 50 years. A detailed 

explanation of greenhouse gases, 

climate change, and its impact on 

health, society, and the environment is 

included in EPA’s technical support 

document (TSD) for the Endangerment 

Finding Final Rule (Docket ID No. EPA– 

HQ–OAR–2009–0472–11292). 

In the United States, the combustion 

of fossil fuels (e.g., coal, oil, gas) is the 

largest source of CO2 emissions and 

accounts for 80 percent of the total GHG 

emissions. Anthropogenic CO2

emissions released from a variety of 

sources, including fossil fuel 

combustion and industrial 

manufacturing processes that rely on 

geologically stored carbon (e.g., coal, oil, 

and natural gas) that is hundreds of 

millions of years old, as well as 

anthropogenic CO2 emissions from landuse changes such as deforestation, all 

perturb the atmospheric concentration 

of CO2 and cause readjustments in the 

distribution of carbon within different 

reservoirs. More than half of the energyrelated emissions come from large 

stationary sources such as power plants, 

while about a third comes from 

transportation. Of the six well-mixed 

GHGs, four (CO2, CH4, N2O, and HFCs) 

are emitted by motor vehicles. In the 

United States industrial processes (such 

as the production of cement, steel, and 

aluminum), agriculture, forestry, other 

land use, and waste management are 

also important sources of GHGs. 

Different GHGs have different heattrapping capacities. The concept of 

Global Warming Potential (GWP) was 

developed to compare the heat-trapping 

capacity and atmospheric lifetime of 

one GHG to another. The definition of 

a GWP for a particular GHG is the ratio 

of heat trapped by one unit mass of the 

GHG to that of one unit mass of CO2

over a specified time period. When 

quantities of the different GHGs are 

multiplied by their GWPs, the different 

GHGs can be summed and compared on 

a CO2-equivalent (CO2e) basis. For 

example, CH4 has a GWP of 21, meaning 

each ton of CH4 emissions would have 

21 times as much impact on global 

warming over a 100-year time horizon 

as 1 ton of CO2 emissions. Thus, on the 

basis of heat-trapping capability, 1 ton 

of CH4 would equal 21 tons of CO2e. 

The GWPs of the non-CO2 GHGs range 

from 21 (for CH4) up to 23,900 (for SF6). 

Aggregating all GHGs on a CO2e basis at 

the source level allows a facility to 

evaluate its total GHG emissions 

contribution based on a single metric. 

2. GHG Regulatory Actions 

Over the past year, EPA has 

completed four distinct actions related 

to greenhouse gases under the CAA. The 

result of these rules, in conjunction with 

the operation of the CAA, has been to 

trigger PSD applicability for GHG 

sources on and after January 2, 2011, but 

to limit the scope of sources covered by 

PSD. These actions include, as they are 

commonly called, the ‘‘Endangerment 

Finding’’ and ‘‘Cause or Contribute 

Finding,’’ which we issued in a single 


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44 ‘‘Endangerment and Cause or Contribute 

Findings for Greenhouse Gases Under Section 

202(a) of the Clean Air Act.’’ 74 FR 66,496 

(December 15, 2009). 

45 ‘‘Light-Duty Vehicle Greenhouse Gas Emission 

Standards and Corporate Average Fuel Economy 

Standards; Final Rule.’’ 75 FR 25,324 (May 7, 2010). 

46A detailed description of EPA’s 

implementation efforts, and the status of state 

compliance with those efforts, is included in 

Declaration of Regina McCarthy, Coalition for 

Responsible Regulation v. EPA, DC Cir. No. 09– 

1322 (and consolidated cases) (McCarthy 

Declaration), including Attachment 1 (Tables 1, 2, 

and 3), which can be found in the docket for this 

rulemaking. 

47 40 CFR 51.166(a)(7)(i), (b)(1)(i)(a), (b)(49). 

48Specifically, under the revised definition of 

‘‘subject to regulation,’’ sources that emit at least the 

75,000 and/or 100,000 tpy CO2e threshold amount 

of GHGs are subject to PSD as long as the amount 

of GHG emissions also exceeds, in general, 100/250 

tpy on a mass basis for new sources and zero tpy 

on a mass basis for modifications of existing 

sources. 40 CFR 51.166(b)(48), 75 FR at 31,606; see 

EPA Office of Air Quality Planning and Standards, 

‘‘PSD and Title V Permitting Guidance for 

Greenhouse Gases.’’ (March 2011 update). 

49Specifically, a state’s implementation of the 

Tailoring Rule in this manner prior to January 2, 

2011 would obviate the need for EPA to narrow its 

approval of that state’s SIP, as EPA had proposed 

in the proposed Tailoring Rule. Thus, in the Final 

Tailoring Rule, EPA delayed final action on its 

narrowing proposal so that EPA could gather 

information about the process and time-line for 

states to implement the Tailoring Rule. 

final action; 44 the Johnson Memo 

Reconsideration, noted previously; the 

‘‘Light-Duty Vehicle Rule’’ (LDVR or 

Vehicle Rule); 45 and the ‘‘Tailoring 

Rule,’’ also noted previously. 

a. Endangerment Finding, Vehicle Rule, 

Johnson Memo Reconsideration 

In the Endangerment and Cause or 

Contribute Finding, which is governed 

by CAA section 202(a), the 

Administrator exercised her judgment, 

based on an exhaustive review and 

analysis of the science, to conclude that 

‘‘six greenhouse gases taken in 

combination endanger both the public 

health and the public welfare of current 

and future generations.’’ 74 FR at 66,496. 

The Administrator also found ‘‘that the 

combined emissions of these 

greenhouse gases from new motor 

vehicles and new motor vehicle engines 

contribute to the greenhouse gas air 

pollution that endangers public health 

and welfare under CAA section 202(a).’’ 

Id. 

The Endangerment Finding led 

directly to promulgation of the Vehicle 

Rule, also governed by CAA section 

202(a), in which EPA set standards for 

the emission of greenhouse gases for 

new motor vehicles built for model 

years 2012–2016. 75 FR 25,324. The 

Vehicle Rule established the first 

controls for GHGs under the CAA. 

The Johnson Memo Reconsideration— 

as well as the Tailoring Rule, which we 

discuss later—is governed by the PSD 

and Title V provisions in the CAA. It 

was issued to address the automatic 

statutory triggering of the PSD and Title 

V programs for GHGs due to the Vehicle 

Rule establishing controls for GHGs. 

The Johnson Memo Reconsideration 

provided EPA’s interpretation of a preexisting definition in its PSD regulations 

delineating the ‘‘pollutants’’ that are 

taken into account in determining 

whether a source must obtain a PSD 

permit and the pollutants each permit 

must control. The Johnson Memo 

Reconsideration stated that when the 

Vehicle Rule takes effect on January 2, 

2011, it will, in conjunction with the 

applicable CAA requirements, trigger 

the application of PSD to GHG-emitting 

sources. 75 FR 17,004. 

b. Tailoring Rule 

In the Tailoring Rule, EPA limited 

PSD applicability, at the outset, to only 

the largest GHG-emitting sources, and to 

phase-in PSD applicability, as 

appropriate, to smaller sources over 

time. 75 FR 31,514. In the Tailoring 

Rule, EPA identified the air pollutant 

that, if emitted or potentially emitted by 

the source in excess of specified 

thresholds, would subject the source to 

PSD requirements, as the aggregate of 

six GHGs: CO2, CH4, N2O, HFCs, PFCs, 

and SF6. EPA based this identification 

on the Vehicle Rule, which included 

applicability provisions specifying that 

the rule ‘‘contains standards and other 

regulations applicable to the emissions 

of those six greenhouse gases.’’ 75 FR at 

25,686 (promulgating 40 CFR 86.1818– 

12(a)). The Tailoring Rule noted that it 

was because the Vehicle Rule subjected 

to regulation the pollutant that is 

comprised of the six GHGs, that PSD 

was triggered for that pollutant and that, 

as a result, the pollutant must be 

defined for PSD purposes in the same 

way as it is identified in the Vehicle 

Rule. 75 FR 31,527. The Vehicle Rule 

identified the pollutant as the aggregate 

of the six gases because in the 

Endangerment Finding, the 

Administrator found that those six 

gases—which she described as longlived and directly emitted GHGs — may 

reasonably be anticipated to endanger 

public health and welfare. 

3. Implementation of GHG PSD 

Requirements 

Because PSD is implemented through 

the SIP system, EPA has taken a series 

of actions to address the obligations of 

states (including localities and other 

jurisdictions, as appropriate) to 

implement PSD requirements for GHGemitting sources. EPA has taken these 

actions through the Tailoring Rule 

discussed elsewhere in this preamble 

and a series of subsequent actions.46

a. Tailoring Rule 

In the Tailoring Rule, EPA 

incorporated the PSD thresholds for 

GHGs in the definition of the term 

‘‘subject to regulation.’’ As noted 

previously, under EPA’s PSD 

regulations, PSD applies to a ‘‘major 

stationary source;’’ a ‘‘major stationary 

source’’ is defined as a source that emits 

100/250 tons per year (tpy) on a mass 

basis of a ‘‘regulated NSR pollutant;’’ 

and a ‘‘regulated NSR pollutant,’’ in 

turn, is defined as, among other things, 

a pollutant that is ‘‘subject to regulation’’ 

under the CAA.47 In the Tailoring Rule, 

EPA added a limitation to the term 

‘‘subject to regulation’’ so that the only 

GHG emissions that would be treated as 

‘‘subject to regulation’’ (and therefore 

subject to PSD) are those emitted at or 

above specified thresholds of, 

depending on the circumstances, 75,000 

and/or 100,000 tpy on a CO2e basis.48

EPA explained in the Tailoring Rule 

that it intends these levels to be the first 

steps in a phase-in approach for PSD 

applicability, and EPA committed in 

that rule to conduct additional 

rulemaking by 2012 and 2016 that 

would consider taking additional steps. 

Some states advised EPA that it is 

likely they would be able to implement 

the Tailoring Rule thresholds by 

interpreting the term ‘‘subject to 

regulation’’ in their SIPs, and without 

having to take further action. A state’s 

ability to take this approach would have 

implications for how EPA needed to 

implement the Tailoring Rule.49

Accordingly, in the Tailoring Rule, EPA 

began a process to gather more 

information about how states would 

implement permitting for GHG-emitting 

sources. 

b. 60-Day Letters 

To gather this information, EPA, in 

the Tailoring Rule, asked states to 

submit letters within 60 days of 

publication of the Tailoring Rule, which 

we refer to as the 60-day letters, 

concerning the status of their PSD 

program and their legal authority for 

applying PSD program to GHG-emitting 

sources. This information would help 

clarify, for each state, the two central 

issues for PSD applicability to GHGemitting sources: (i) Whether the state 

has an approved PSD program that 

applies to GHG-emitting sources; and 

(ii) if so, what action the state would 

take to limit the applicability of its PSD 

program to GHG-emitting sources at or 


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50Alternatively, a state could choose to apply its 

PSD program to sources below the Tailoring Rule 

thresholds and acquire sufficient resources to 

implement the program as expanded, but no state 

had indicated an intention to proceed in this 

manner. 

51McCarthy Declaration, paragraphs 28–33, page 

8, and Attachment 1, Table 1. 

52 Id., paragraphs 34–55, pages 8–12, and 

Attachment 1, Table 2. 

53 ‘‘Limitation of Approval of Prevention of 

Significant Deterioration Provisions Concerning 

Greenhouse Gas Emitting Sources in State 

Implementation Plans; Final Rule, 75 FR 82535 

(December 30, 2010). Specifically, in the Narrowing 

Rule, EPA narrowed its approval of the affected 

states’ SIP PSD applicability provisions to only the 

extent they apply PSD to GHG-emitting sources at 

or above the Tailoring Rule thresholds. In addition, 

recognizing that GHG-emitting sources also have 

permitting obligations under state law, EPA has 

strongly encouraged states to revise their state law 

as promptly as possible to eliminate the state PSD 

obligations of sources below the Tailoring Rule 

thresholds. McCarthy Declaration paragraph 92, 

page 19. 

54 Id. paragraphs 62–94, pages 13–20, and 

Attachment 1, Table 3. 

55 ‘‘Action to Ensure Authority to Issue Permits 

under the Prevention of Significant Deterioration 

Program to Sources of Greenhouse Gas Emissions: 

Finding of Substantial Inadequacy and SIP Call— 

Proposed Rule,’’ 75 FR 53,892 (September 2, 2010); 

‘‘Action to Ensure Authority to Issue Permits under 

the Prevention of Significant Deterioration Program 

to Sources of Greenhouse Gas Emissions: Federal 

Implementation Plan—Proposed Rule,’’ 75 FR 

53,883 (September 2, 2010). 

56 ‘‘Action to Ensure Authority to Issue Permits 

under the Prevention of Significant Deterioration 

Program to Sources of Greenhouse Gas Emissions: 

Finding of Substantial Inadequacy and SIP Call— 

Final Rule,’’ 75 FR 77,698 (December 13, 2010). 

above the Tailoring Rule thresholds.50

This information would assist EPA to 

determine what, if any, action it needed 

to take with respect to the states. 

Almost all states submitted 60-day 

letters, generally by August 4, 2010. The 

letters, along with other information 

EPA received through review of state 

requirements and further 

communications with state officials, 

indicate that the states, localities, and 

other jurisdictions may be divided into 

three categories, described later in this 

preamble, for purposes of EPA’s 

implementation of the PSD program to 

GHG-emitting sources. 

c. The Three Categories of States and 

EPA’s Implementation Process 

The first category, which includes 7 

states, 35 subsections of states, the 

District of Columbia, American Samoa, 

Guam, Puerto Rico, the U.S. Virgin 

Islands, and Indian Territory, does not 

have an approved SIP PSD permitting 

program. Instead, Federal requirements 

apply. Thus, implementation of PSD for 

GHG-emitting sources in these 

jurisdictions is the simplest of all the 

states: GHG-emitting sources became 

subject to PSD and the thresholds in the 

Tailoring Rule as of January 2, 2011, 

without further action.51

The second category includes 13 

states and a number of districts within 

states that have approved PSD SIPs, but 

those SIPs do not apply the PSD 

program to GHG-emitting sources. This 

group includes Texas, which is the 

focus of this action. The implementation 

process for this category is discussed 

later.52

The third category includes the 

remaining states, which have an 

approved SIP PSD program that applies 

to GHG-emitting sources. As for the 

implementation process for this 

category, some of these states have 

indicated that they are able to interpret 

their SIPs to apply PSD only to GHG 

emissions at or above the Tailoring Rule 

thresholds, and that they do not need to 

revise their SIPs to do so. However, 

most indicated that they would need to 

submit SIP revisions to EPA in order to 

incorporate the Tailoring Rule 

thresholds. This means that in these 

states, until they do submit their SIP 

revisions and EPA approves them, 

sources emitting GHGs at or above the 

100/250 tpy levels are subject to PSD 

requirements as of January 2, 2011, if 

they construct or modify. EPA has 

encouraged these states to submit SIP 

revisions adopting the Tailoring Rule 

thresholds as soon as possible and some 

of these states have already done so. 

Moreover, almost all of these states are 

proceeding to revise their state law to 

reflect the Tailoring Rule thresholds and 

either did so by January 2, 2011, or very 

soon thereafter, or are currently in the 

process of revising their SIPs. In the 

meantime, EPA has finalized what we 

call the Narrowing Rule so that as of 

January 2, 2011, at least for Federal 

purposes, PSD will apply to GHGemitting sources only at the Tailoring 

Rule thresholds or higher.53 As a result 

of these state actions and EPA’s 

Narrowing Rule, as of January 2, 2011, 

or shortly thereafter, in all or almost all 

of these states, only GHG-emitting 

sources at or above the Tailoring Rule 

thresholds are subject to PSD 

requirements. 54

d. SIP Call States, Including Texas 

As just noted, the second category, 

which includes Texas, includes 13 

states and some districts within states 

whose SIPs have an approved PSD 

program but do not have the authority 

to apply that program to GHG-emitting 

sources. For most of these states, 

including Texas, the reason is that their 

PSD applicability provision applies to 

any ‘‘pollutant subject to regulation’’ 

under the CAA (or a similar term), but 

other provisions of state law preclude 

automatic updating. As a result, this 

applicability provision covers only 

pollutants—not including GHGs—that 

were subject to regulation at the time 

the state adopted the applicability 

provision. 

After proposing action by notice dated 

September 2, 2010,55 EPA promulgated 

the final SIP call for 13 states, including 

Texas, by notice signed on December 1, 

2010, and published on December 13, 

2010, 75 FR 77,698, which we call the 

GHG PSD SIP Call or, simply, the SIP 

call.56 In this action, consistent with the 

requirements of CAA section 110(k)(5), 

EPA (i) issued a finding that the SIPs for 

13 states (comprising 15 state and local 

programs) are ‘‘substantially inadequate 

to * * * comply with any requirement 

of this Act’’ because their PSD programs 

do not apply to GHG-emitting sources as 

of January 2, 2011; (ii) issued a SIP call 

requiring submission of a corrective SIP 

revision; and (iii) established a 

‘‘reasonable deadline[] (not to exceed 18 

months after the date of such notice)’’ 

for the submission of the corrective SIP 

revision. This deadline ranges, for 

different states, from 3 weeks to 12 

months after the date of the final SIP 

call, as discussed later in this preamble. 

EPA justified its finding that the 

affected SIPs are ‘‘substantially 

inadequate’’ to comply with CAA 

requirements on grounds that (i) the 

CAA requires that PSD requirements 

apply to any stationary source that emits 

specified quantities of any air pollutant 

subject to regulation under the CAA, 

and those PSD requirements must be 

included in the approved SIPs; (ii) as of 

January 2, 2011, GHG-emitting sources 

will become subject to PSD; (iii) as a 

result, the CAA requires PSD programs 

to apply to GHG-emitting sources; and 

(iv) accordingly, the failure of any SIP 

PSD applicability provisions to apply to 

GHG-emitting sources means that the 

SIP fails to comply with these CAA 

requirements. 

In the SIP call proposal, EPA 

discussed in some detail the SIP 

submittal deadline under CAA section 

110(k)(5). Under this provision, in 

issuing a SIP call, EPA ‘‘may establish 

reasonable deadlines (not to exceed 18 

months after the date of such notice) for 

the submission of such plan revisions.’’ 

EPA proposed to allow each of the 

affected states up to 12 months from the 

date of signature of the final finding of 

substantial inadequacy and SIP call 

within which to submit the SIP revision, 

unless, during the comment period, the 

state expressly advised that it would not 

object to a shorter period—as short as 3 

weeks from the date of signature of the 


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57McCarthy Declaration, p. 12, paragraph 55. 

58California’s PSD program is administered in its 

entirety by local jurisdictions. 

59McCarthy Declaration, p. 20, paragraph 98. 

There have been a few changes in the status of 

individual states since this time, but the overall 

picture remains the same. EPA has been in close 

communication with almost every state and many 

other jurisdictions, along with multi-state 

organizations such as the National Association of 

Clean Air Agencies (NACAA). In addition to the 

letters that states have sent responding to the 

Tailoring Rule (the 60-day letters) and proposed SIP 

Call (the 30-day letters), EPA officials, primarily 

through the Regional Offices, have had numerous 

communications with their state counterparts. It is 

as a result of the prompt action taken by the states 

that implementation efforts have been so successful 

to date. 

final rule—in which case EPA would 

establish the shorter period as the 

deadline. EPA stated that, assuming that 

EPA were to finalize the SIP call on or 

about December 1, 2010, as EPA said it 

intended to do in the proposal, then the 

earliest possible SIP submittal deadline 

would be December 22, 2010. 

EPA made clear that the purpose of 

establishing the shorter period as the 

deadline for any interested state is to 

accommodate states that wish to ensure 

that a FIP is in effect as a backstop to 

avoid any gap in PSD permitting. EPA 

also made clear that if a state did not 

advise EPA that it does not object to a 

shorter deadline, then the 12-month 

deadline would apply. EPA emphasized 

that for any state that receives a 

deadline after January 2, 2011, the 

affected GHG-emitting sources in that 

state may be delayed in their ability to 

receive a Federally approved permit 

authorizing construction or 

modification. This is because after 

January 2, 2011, these sources may not 

have available a permitting authority to 

review their permit applications until 

the date that EPA either approves the 

SIP submittal or promulgates a FIP. 

EPA asked that each of the affected 

states write EPA a letter during the 

comment period to identify the deadline 

for SIP submission to which the state 

would not object if EPA established. We 

call these the 30-day letters. Each 

affected state wrote a 30-day letter to 

EPA, as requested. Except for Texas, 

each state identified a SIP submittal 

deadline, which differed among the 

states, and which ranged from three 

weeks to 12 months. In the final SIP 

call, EPA established SIP submittal 

deadlines identified by the states, 

except that EPA established a deadline 

of 12 months for Texas, in accordance 

with EPA’s proposal. Except for Texas, 

each state explained in its 30-day letter 

and in subsequent communications 

with EPA, that it was planning on either 

receiving a FIP or adopting a SIP and 

that it chose a deadline that would 

result in having either the FIP or an 

approved SIP, as appropriate, in place 

by January 2, 2011 or soon enough 

thereafter so as to avoid any hardship to 

its sources. In the final SIP call, EPA 

justified approving this 3-week-to-12- 

month time period, although 

expeditious, as meeting the CAA section 

110(k)(5) requirement to be a 

‘‘reasonable’’ deadline in light of: (i) The 

SIP development and submission 

process; (ii) the preference of the state; 

and (iii) the imperative to minimize the 

period when sources will be subject to 

PSD but will not have available a PSD 

permitting authority to act on their 

permit application and therefore may 

face delays in constructing or 

modifying. 

In the final SIP call, based on the 

states’ 30-day letters and other 

communications, EPA established a SIP 

submittal deadline of December 22, 

2010, for seven states. Each of the states 

indicated that it did not expect to 

submit a SIP revision by that date and 

instead expected to receive a FIP. On 

December 23, 2010, for each of the 

seven states, EPA issued a finding of 

failure to submit its corrective SIP 

revision by that deadline, and EPA 

promulgated a FIP. 

Except for Texas, EPA expected each 

of the other states subject to the SIP call 

to adopt a SIP revision and receive EPA 

approval of it, or receive a FIP, within 

the first half of 2011, and, in most cases, 

substantially sooner. Although none of 

these states had a permitting authority 

in place as of January 2, 2011, none of 

these states expected that gap to pose 

meaningful difficulties for sources 

because, depending on the state, the gap 

would be brief, and the state did not 

expect any sources to seek a permit 

during the gap, or even if the state had 

been the permitting authority during the 

gap, it could not have completed 

processing the permits during that 

time.57

As discussed later, Texas has 

responded to the SIP call differently 

than the other states. As a result, its 

GHG-emitting sources do face the 

prospect of permitting delays. This 

rulemaking action addresses that 

situation. 

4. Summary of the Effect of EPA’s 

Implementation Actions in States Other 

Than Texas 

EPA recently summarized the status 

of its implementation efforts, for all 

three categories of sources, as follows: 

Overall, EPA has received information 

about the status of 99 jurisdictions (49 

states,58 4 territories, 45 localities, and the 

District of Columbia), and included that 

information in Attachment 1. Of these 

jurisdictions, 94 will have, for Federal law 

purposes, a PSD permitting program for GHG 

emissions at the Tailoring Rule thresholds on 

Jan. 2, 2011. Of these 94 entities, 84 will have 

made any necessary amendments to state or 

local law to ensure that state or local permits 

are not required for GHG emissions below 

Tailoring Rule thresholds. By the end of the 

first quarter of 2011, only one jurisdiction 

will not have authority to permit GHG 

sources, and that jurisdiction will obtain 

authority by July 1, 2011 and in the 

meantime, does not expect large sources 

seeking permits for their GHGs. In addition, 

by the end of the first quarter of 2011, all but 

one more state will have made any necessary 

amendments to state or local law to ensure 

that permits are not required for GHG 

emissions below Tailoring Rule levels. 1 

program with GHG permitting authority at 

the lower statutory levels has not yet 

determined how, and on which timeline, it 

will incorporate the Tailoring Rule 

thresholds into its state law.59

Thus, under EPA’s implementation 

program, (i) in every state, (a) only 

sources at or above the Tailoring Rule 

thresholds will be subject under Federal 

law to obtain a PSD permit when they 

construct or modify as of January 2, 

2011, and (b) only those same sources 

will be subject under state law to obtain 

a PSD permit when they construct or 

modify as of January 2, 2011 or very 

soon thereafter; and (ii) in every state, 

except for Texas, as of January 2, 2011 

or very soon thereafter, GHG sources 

that construct or modify will be able to 

receive permits when they need them, 

so that the sources will not face 

obstacles to constructing and modifying. 

Again, Texas has responded to EPA’s 

implementation program in a manner 

that has resulted in its sources facing 

obstacles to constructing and modifying, 

as discussed next, which this 

rulemaking addresses. 

5. EPA’s Implementation Approach for 

Texas and Texas’s Response 

The following describes the progress 

to date of implementing PSD for GHG 

emissions in Texas, based on extensive 

communications between EPA and 

TCEQ. It should be borne in mind, as 

noted earlier, that Texas is in the second 

of the three categories of states: that is, 

it has an approved PSD program that 

does not apply to GHGs-emitting 

sources. 

a. Texas’s 60-Day Letter 

Texas’s 60-day letter provides the 

State’s clearest articulation of its 

response to EPA’s efforts to implement 

PSD for GHG-emitting sources at the 

Tailoring Rule thresholds beginning 

January 2, 2011. As noted previously, in 

the preamble to the final Tailoring Rule, 

EPA asked each state to send EPA a 


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60Letter from Bryan W. Shaw, Chairman, Texas 

Commission on Environmental Quality, and Greg 

Abbott, Attorney General of Texas, to Hon. Lisa 

Jackson, Administrator, U.S. Environmental 

Protection Agency, and Dr. Alfredo ‘‘Al’’ 

Armendariz, Regional Administrator, U.S. 

Environmental Protection Agency, Region 6 (August 

2, 2010) (Texas’s 60-day letter), included in the 

docket for this rulemaking. 

61 In this explanation, Texas was referring to the 

PSD applicability provision that Texas adopted 

under State law in 2006, which differed slightly 

from the applicability provision approved into the 

SIP in 1993. 

62 ‘‘State of Texas’s Motion For A Stay Of EPA’s 

Endangerment Finding, Timing Rule, and Tailpipe 

Rule,’’ Coalition for Responsible Regulation v. EPA, 

No. 09–1322 (and consolidated cases) (September 

15, 2010). On December 10, 2010, the DC Circuit 

denied Texas’s, and other parties’, motions to stay. 

Order, Coalition for Responsible Regulation v. EPA, 

No. 09–1322 (and consolidated cases) (December 

10, 2010). 

63 ‘‘State of Texas’s Motion For A Stay Of EPA’s 

Greenhouse Gas Tailoring Rule,’’ Coalition for 

Responsible Regulation v. EPA, No. 09–1322 (and 

consolidated cases) (September 15, 2010) (Texas’s 

Motion to Stay the Tailoring Rule). 

letter within 60 days to identify which 

category the state was in and what 

action the state intended to take. 

Specifically, with regard to sources in 

Category 2, EPA stated: 

In our proposed rule, we also noted that a 

handful of EPA-approved SIPs fail to include 

provisions that would apply PSD to GHG 

sources at the appropriate time. This is 

generally because these SIPs specifically list 

the pollutants subject to the SIP PSD program 

requirements, and do not include GHGs in 

that list, rather than include a definition of 

NSR regulated pollutant that mirrors the 

Federal rule, or because the state otherwise 

interprets its regulations to limit which 

pollutants the state may regulate. At 

proposal, we indicated that we intended to 

take separate action to identify these SIPs, 

and to take regulatory action to correct this 

SIP deficiency. 

We ask any state or local permitting agency 

that does not believe its existing SIP provides 

authority to issue PSD permits to GHG 

sources to notify the EPA Regional 

Administrator by letter, and to do so no later 

than August 2, 2010. This letter should 

indicate whether the state intends to 

undertake rulemaking to revise its rules to 

apply PSD to the GHG sources that will be 

covered under the applicability thresholds in 

this rulemaking, or alternatively, whether the 

state believes it has adequate authority 

through other means to issue Federallyenforceable PSD permits to GHG sources 

consistent with this final rule. For any state 

that lacks the ability to issue PSD permits for 

GHG sources consistent with this final rule, 

we intend to undertake a separate action to 

issue a SIP call, under CAA section 110(k)(5). 

As appropriate, we may also impose a FIP 

through 40 CFR 52.21 to ensure that GHG 

sources will be permitted consistent with this 

final rule. 

75 FR 31,582/3. 

With regard to states in category 3, 

EPA requested that in the states’ 60-day 

letter, 

the state should explain whether it will apply 

EPA’s meaning of the term ‘‘subject to 

regulation’’ and if so, whether the state 

intends to incorporate that meaning of the 

term through interpretation, and without 

undertaking a regulatory or legislative 

process. If a state must undertake a regulatory 

or legislative process, then the letter should 

provide an estimate of the time needed to 

adopt the final rules. If a state chooses not 

to adopt EPA’s meaning by interpretation, the 

letter should address whether the state has 

alternative authority to implement either our 

tailoring approach or some other approach 

that is at least as stringent, whether the state 

intends to use that authority. If the state does 

not intend to interpret or revise its SIP to 

adopt the tailoring approach or such other 

approach, then the letter should address the 

expected shortfalls in personnel and funding 

that will arise if the state attempts to carry 

out PSD permitting for GHG sources under 

the existing SIP and interpretation. 

For any state that is unable or unwilling to 

adopt the tailoring approach by January 2, 

2011, and that otherwise is unable to 

demonstrate adequate personnel and 

funding, we will move forward with 

finalizing our proposal to limit our approval 

of the existing SIP. 

75 FR 31,582/3. 

On August 2, 2010, Texas submitted 

its 60-day letter, signed by the Texas 

Attorney General and the Chairman of 

the Texas Commission on 

Environmental Quality.60 In that letter, 

Texas responded specifically to EPA’s 

request that ‘‘any state * * * that does 

not believe its existing SIP provides 

authority to issue PSD permits to GHG 

sources to notify [EPA and] * * * 

indicate whether the state intends to 

* * * revise its rules to apply PSD to 

* * * GHG sources’’ by stating: ‘‘Texas 

has neither the authority nor the 

intention of interpreting, ignoring, or 

amending its laws in order to compel 

the permitting of greenhouse gas 

emission.’’ Id. p. 1. Texas offered several 

explanations for this position. First, 

Texas noted: 

Texas’ stationary source permitting 

program encompasses all ‘‘federally regulated 

new source review pollutants,’’ including, 

‘‘any pollutant that otherwise is subject to 

regulation under the [federal Clean Air Act].’’ 

30 Tex. Admin. Code § 116.12(14)(D). The 

rules of the Texas Commission on 

Environmental Quality (TCEQ), like the 

EPA’s rules, do not define the phrase ‘‘subject 

to regulation.’’ 

Id. p. 2. Texas then explained that it had 

several objections to interpreting the 

phrase ‘‘subject to regulation’’ to allow 

regulation of GHGs. For one thing, 

according to Texas, long-standing state 

case law precluded the term—and the 

PSD applicability provisions generally— 

from automatically incorporating newly 

regulated pollutants. Specifically, Texas 

said: 61

* * * Texas’ stationary source permitting 

program encompasses all ‘‘federally regulated 

new source review pollutants,’’ including 

‘‘any pollutant that otherwise is subject to 

regulation under the [federal Clean air Act].’’ 

30 Tex. Admin. Code § 116.12(14)(D). This 

delegation of legislative authority to the EPA 

is limited solely to those pollutants regulated 

when Texas Rule 116.12 was adopted (1993) 

and last amended (2006). As the Texas 

Supreme Court has explained, ‘‘The general 

rule is that when a statute is adopted by a 

specific descriptive reference, the adoption 

takes the statute as it exists at that time, and 

the subsequent amendment thereof would 

not be within the terms of the adopting act.’’ 

Trimmer v. Carlton, 296 S.W. 1070 (1927). 

Thus, in order for Texas Rule 116.12 to pass 

constitutional muster, it must be limited to 

adopting by reference the definition of 

‘‘subject to regulation’’ in existence when 

Rule 116.12 was last amended in 2006. In 

other words, Texas Rule 116.12 cannot 

delegate authority to the EPA to define 

‘‘subject to regulation’’ in 2010 to include 

pollutants that were not ‘‘subject to 

regulation’’ in 2006. 

Id. at 4. 

Secondly, Texas took the position that 

PSD applies only to NAAQS pollutants, 

and not non-NAAQS pollutants. Texas 

stated: 

The only sensible interpretation of the 

Clean Air Act is one that requires the EPA 

to promulgate a National Ambient Air 

Quality Standard (NAAQS) for greenhouse 

gases before the EPA can require PSD 

permitting of greenhouse gases. * * * EPA, 

however, has not developed a NAAQS for 

greenhouse gases. * * * 

Id. at 4–5. 

Texas provided a more detailed 

exposition of its view that PSD applies 

only to NAAQS pollutants in its 

challenges before the DC Circuit to 

EPA’s GHG actions, where Texas moved 

to stay the Endangerment Finding, the 

Vehicle Rule, and the Johnson Memo 

Reconsideration (Texas’s Motion to Stay 

Three GHG Actions).62 (In a separate 

motion, Texas also moved to stay the 

Tailoring Rule.63) There, Texas 

reiterated arguments based on the text of 

some of the CAA PSD provisions that, 

in Texas’s view, lead to the conclusion 

that the CAA precludes applying PSD to 

non-NAAQS. As noted previously, these 

arguments were raised by commenters 

to the Tailoring Rule. Texas concluded 

that EPA’s efforts to apply PSD to 

GHGs— 

thus violates the CAA. Moreover, [EPA’s] 

interpretation of the CAA is not entitled to 

deference because the text of the statute is 

unambiguous. Chevron, U.S.A. v. NRDC, 467 

U.S. 837, 842 (1984) (the Agency must give 

effect to the unambiguously expressed intent 

of Congress). Accordingly, EPA’s attempt to 

short cut the CAA’s NAAQS 


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64Texas’s Motion to Stay Three GHG Actions, at 

27. 

65 Id. at 5. 

66 ‘‘Texas Commission on Environmental Quality 

Comments on Actions to Ensure Authority to Issue 

Permits Under the Prevention of Significant 

Deterioration Program to Sources of Greenhouse 

Gas Emissions, Finding of Substantial Inadequacy 

and SIP Call, Docket ID No. EPA–HQ–OAR–2010– 

0107, FRL–9190–7 Federal Implementation Plan 

(FIP), Docket ID No EPA–HQ–OAR–2010–0107, 

FRL–9190–8 (October 4, 2010) (Texas 30-day letter). 

67Final SIP Call, 75 FR at 77,706/2–3 and n. 18. 

68Texas’s Motion to Stay the Tailoring Rule, pp. 

2, 16. 

process in order to regulate GHG emissions 

from stationary sources through PSD and 

Title V must fail.64

At the close of its 60-day letter, Texas 

added, ‘‘In the event a court concludes 

EPA’s actions comport with the law, 

Texas specifically reserves and does not 

waive any rights under the Federal 

Clean Air Act or other law with respect 

to the issues raised herein.’’ 65

b. Texas’s 30-Day Letter 

As noted previously, in the GHG PSD 

SIP call proposal, EPA proposed to 

establish, for each affected state, a 

deadline of 12 months from the date of 

signature of the final SIP call for 

submitting the corrective SIP revision, 

unless the state expressly advised EPA 

in its 30-day letter that it would not 

object to a shorter period. Texas 

submitted a 30-day letter on October 4, 

2010,66 and in that letter, voiced various 

objections to the proposed SIP call. 

Texas reiterated its view that PSD is 

limited to NAAQS pollutants, and 

therefore cannot apply to GHGs, and 

added that the SIP call is ‘‘based on an 

impermissible interpretation of the 

[Clean Air Act]. EPA cannot * * * 

impose permitting through [the PSD] 

program without first setting a 

NAAQS.* * * ’’ Texas 30-day letter p. 

2, 4. EPA responded to those objections 

in the final SIP call.67

In its 30-day letter, Texas went on to 

discuss the SIP submission schedule 

and FIP that EPA proposed, but Texas 

declined EPA’s invitation to identify a 

specific deadline for the state’s SIP 

submission. As a result, in the final SIP 

call, EPA was obliged to establish the 

default SIP submission deadline for 

Texas of December 1, 2011, in 

accordance with EPA’s proposal. 

Because Texas has clearly stated that it 

does not intend, and, in its view, does 

not have the authority, to adopt a SIP 

revision to respond to the SIP Call, 

including to apply PSD to GHG-emitting 

sources, EPA expects to promulgate a 

FIP to continue to apply PSD to these 

sources in December, 2011. But, again, 

because Texas did not identify an earlier 

deadline for its SIP submittal, the 

earliest that EPA could promulgate such 

a FIP would be December 2, 2011. 

Under this approach, due to the position 

Texas has taken, absent further action, 

sources in Texas could not expect to 

have a permitting authority with 

authority to issue preconstruction 

permits for their GHG emissions until 

that December 2, 2011, date. As a result, 

absent further action, sources in Texas 

would face obstacles in constructing or 

modifying before that date. 

Texas’s 30-day letter indicates that 

Texas was well aware of the 

consequences of its decision not to 

identify a specific deadline for its SIP 

submission, but had several reasons for 

making that decision. These included its 

view, again, that PSD applies only to 

NAAQS pollutants, and also that EPA 

was required to employ a different 

process for requiring a SIP revision, one 

that would have provided the state with 

3 years to adopt a SIP revision. Texas 

30-day letter at 4–5. In addition, Texas 

asserted that there is no reason to allow 

EPA to promulgate an early FIP for the 

benefit of Texas’s sources because, in 

Texas’s view, for practical reasons, EPA 

could not issue those permits for the 

‘‘foreseeable future’’ anyway. 

Specifically, Texas explained that EPA 

had not issued guidance for determining 

BACT, the key element of a PSD permit 

for a GHG source. Texas added that even 

after EPA issued that guidance, BACT 

will, in Texas’s view, remain uncertain 

and contentious, and the guidance will 

be of limited usefulness until the 

control technology is proven. Id. at 5. 

Texas added that ‘‘[i]ndustry should be 

particularly concerned about EPA’s lack 

of resources and experience to issue 

these permits.* * * ’’ Id. at 6. Texas 

concluded, ‘‘The result of all this is that, 

even under a FIP, it is unlikely that 

construction of new major GHG sources 

or major modifications will commence 

in the foreseeable future.’’ Id. at 6. 

In order to reduce uncertainty for 

sources and permitting authorities, EPA 

has issued guidance for use in 

determining BACT, provided training 

for permitting authorities and sources, 

and is continuing to maintain and 

update resources for use in making 

these determinations. These resources 

include question and answer documents 

and white papers on proven and 

emerging technologies for reducing 

greenhouse gas emissions in different 

industries as well as continued close 

interaction between sources, permitting 

authorities, and EPA. 

It should be noted that Texas stated in 

filings before the DC Circuit in which it 

challenged the Tailoring Rule that it 

believed 167 projects in Texas would be 

affected by the lack of a permitting 

authority during 2011.68

IV. Final Action and Response to 

Comments 

In this action, EPA is taking the 

following actions to ensure that there is 

a mechanism for large, GHG-emitting 

sources in Texas to obtain PSD permits 

under a program that complies with the 

CAA. First, EPA is determining that the 

Administrator’s action approving the 

Texas SIP PSD program was in error 

under CAA section 110(k)(6). 

Second, EPA, in the same manner as 

its past action to approve the Texas SIP 

PSD program, is revising such action as 

appropriate without requiring any 

further submission from Texas. Id. The 

appropriate revision is to convert the 

previous approval to a partial approval 

and partial disapproval. The partial 

approval applies to the extent that 

Texas’s PSD program actually covers 

pollutants that are required to be 

included in PSD. The partial 

disapproval applies to the extent that 

Texas failed to address or to include 

assurances of adequate legal authority 

(required under CAA section 

110(a)(2)(E)(i)) for the application of 

PSD to each newly regulated pollutant, 

including non-NAAQS pollutants, 

under the CAA. Note that as an 

alternative basis to CAA section 

110(k)(6) for taking these first two steps, 

EPA relies on its inherent 

administrative authority to reconsider 

its previous action. 

Third, in this rulemaking, EPA is 

promulgating a FIP to apply appropriate 

measures to assure that EPA’s PSD 

regulatory requirements will apply to 

non-NAAQS pollutants that are newly 

subject to regulation under the CAA that 

the Texas PSD program does not already 

cover. At present, the only such 

pollutant is GHGs. Therefore, EPA’s FIP 

will at present apply the EPA regulatory 

PSD program for the GHG portion of 

PSD permits for GHG-emitting sources 

in Texas, and EPA commits to take 

whatever steps are appropriate if, in the 

future, Texas fails to apply PSD to 

another newly regulated non-NAAQS 

pollutant. In light of the immediate need 

of Texas’s GHG-emitting sources for a 

permitting authority to process their 

permit applications for GHGs, this rule 

will be effective on May 1, 2011. 


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A. Response to General Comments on 

the Operation of the PSD Program 

1. Comments on the Self-Executing 

Nature of the PSD Program 

Several commenters disagreed with 

EPA’s position regarding section 165(a) 

of the CAA and argue that EPA’s 

decision to regulate GHGs had no selfexecuting effect on the permitting 

requirements applicable to sources in 

Texas. These commenters state that the 

only CAA requirements that are selfexecuting are found in CAA section 168, 

a section of the statute that incorporated 

PSD changes made in the 1977 

amendments to the Act. Instead, 

according to these commenters, GHGemitting sources became subject to PSD 

requirements through EPA’s revisions to 

the PSD regulations in 40 CFR 51.166, 

and those regulations provide states 3 

years to revise their SIPS to incorporate 

changes in the PSD program. 

Accordingly, one commenter asserted 

that rather than imposing a 

‘‘construction permitting moratorium’’ 

upon EPA’s adoption of a new 

minimum PSD requirement, the PSD 

rules provide states a reasonable period 

of time for incorporating a new 

minimum PSD requirement, with 

prospective effect, into SIPs, during 

which time the EPA-approved SIP 

continues in force and the state may 

continue to issue permits under that SIP 

without addressing the new minimum 

requirement promulgated by EPA. 

2. EPA Response 

EPA indicated in the proposal for this 

rulemaking, 75 FR at 82,388/2, that in 

earlier rulemakings, EPA took comment 

on and resolved the issue of whether the 

CAA PSD requirements apply by their 

terms, so that EPA was not soliciting 

comment on that issue in this 

rulemaking. In those earlier 

rulemakings, EPA concluded that the 

CAA PSD requirements do apply by 

their terms, so that sources in a state are 

subject to PSD for their emissions of 

pollutants newly subject to regulation 

even if the state has an approved SIP 

that does not apply PSD to those 

pollutants. See 75 FR 31,514 (June 3, 

2010) and 75 FR 77,698 (December 13, 

2010). As noted earlier in this preamble, 

notwithstanding the proposal, EPA did 

receive comments on this issue in this 

rulemaking. Because EPA resolved this 

issue in those earlier rulemakings, and 

those dissatisfied with that resolution 

may challenge it in court—and in fact 

are so doing—and because the present 

rulemaking is based on those 

rulemakings, EPA is not obliged to 

respond to those comments in this 

rulemaking. 

Even so, for the sake of completeness, 

and without reopening this issue in this 

rulemaking, EPA does provide the 

following response. EPA disagrees with 

these commenters and EPA continues to 

take the view that the CAA PSD 

requirements apply by their terms to 

pollutants newly subject to regulation, 

regardless of whether a state with an 

approved SIP applies PSD to such 

pollutants. As discussed at length in the 

preamble to the final PSD GHG SIP call 

(75 FR 77,707–77,709, Dec 13. 2010), 

the CAA requirements (i) prohibit a 

‘‘major emitting facility’’ from 

constructing or modifying without 

obtaining a permit that meets the PSD 

requirements, CAA section 165(a)(1); 

and (ii) define a ‘‘major emitting facility’’ 

as a source that emits a specified 

quantity of ‘‘any air pollutant,’’ CAA 

section 169(1), which EPA has long 

interpreted as any pollutant subject to 

regulation. 40 CFR 52.166(b)(49)(iv). In 

this manner, the CAA requirements for 

PSD applicability are what we call 

automatically updating, that is, at the 

very time EPA regulates a previously 

unregulated pollutant, any source 

emitting that pollutant in sufficient 

quantities becomes a ‘‘major emitting 

facility,’’ and that source cannot 

construct or modify without receiving a 

PSD permit. That is, PSD applies to that 

pollutant at the time it becomes subject 

to regulation, without further regulatory 

action by EPA. 

EPA regulations have codified this 

automatically updating aspect of the 

CAA PSD requirements. See 43 FR 

26,380, 26,403/3, 26,406 (June 19, 1978) 

(promulgating 40 CFR 51.21(b)(1)(i)) and 

42 FR 57,479, 57,480, 57,483 (November 

3, 1977) (proposing 40 CFR 

51.21(b)(1)(i)) (applying PSD 

requirements to a ‘‘major stationary 

source’’ and defining that term to 

include sources that emit specified 

quantities of ‘‘any air pollutant regulated 

under the Clean Air Act’’). Most 

recently, in our 2002 NSR Reform rule, 

EPA reiterated these requirements, 

although changing the terminology. 67 

FR 80,186 (December 31, 2002). 

Specifically, EPA required that 

emissions of ‘‘any regulated NSR 

pollutant’’ be subject to PSD 

requirements when emitted in specified 

quantities by sources and defined that 

term to include pollutants regulated 

under certain CAA requirements, as 

well as ‘‘any pollutant that otherwise is 

subject to regulation under the [CAA].’’ 

40 CFR 52.166(b)(49)(iv). EPA made 

clear in the preamble to the NSR Reform 

rule that PSD applicability was 

automatically updating. 67 FR 80,240. 

GHG-emitting sources became subject 

to PSD due to the operation of these 

CAA and regulatory provisions, in 

conjunction with the Light-Duty Vehicle 

Rule. The latter rule subjected GHGs to 

regulation for the first time, as of 

January 2, 2011, so that, by operation of 

the CAA PSD provisions and the 

associated regulatory provisions, PSD 

automatically applied to GHG-emitting 

stationary sources as of that date. The 

Tailoring Rule codified in 40 CFR 

51.166 an interpretation that, read in 

conjunction with the Light-Duty Vehicle 

Rule regulations, had the effect of 

establishing the January 2, 2011 date by 

which GHGs became subject to 

regulation, see 40 CFR 51.166(b)(48) 

along with a phase-in schedule, see id 

at 51.166(b)(48)(iv)–(v). However, 

contrary to commenters arguments, the 

Tailoring Rule did not itself require that 

PSD apply to GHG-emitting sources, and 

the provisions that the Tailoring Rule 

incorporated into 40 CFR 51.166(b)(48), 

as just described, did not impose that 

requirement. 

Accordingly, commenters are 

incorrect in arguing that the 

authorization for states to submit PSD 

SIP revisions within a three-year period, 

under 40 CFR 51.166(a)(6), means that 

PSD does not apply to GHG-emitting 

sources until states submit such a SIP 

revision. Section 51.166(a)(6) provides, 

in relevant part: ‘‘Any State required to 

revise its implementation plan by 

reason of an amendment to this section 

* * * shall adopt and submit such plan 

revision to the Administrator for 

approval no later than three years after 

such amendment is published in the 

Federal Register’’; and ‘‘[a]ny [such] 

revision * * * shall take effect no later 

than the date of its approval and may 

operate prospectively. 40 CFR 

51.166(a)(6)(i), (iii) (emphasis added). 

There are several reasons why this 

provision does not mean that PSD does 

not apply to GHG-emitting sources until 

after a state revises its SIP in accordance 

with the Tailoring Rule. For one thing, 

because this provision is a regulation, it 

cannot, no matter how it is interpreted, 

override the CAA requirements that 

apply PSD requirements to GHGemitting sources so that those CAA 

requirements do not take effect as of 

January 2, 2011. 

For another, this provision does not 

apply to the requirement that GHGemitting sources became subject to PSD 

as of January 2, 2011. GHG-emitting 

sources became subject to PSD by 

operation of the CAA and existing 

regulations, in conjunction with the 

Light-Duty Vehicle Rule, not because of 

any amendment to 40 CFR 51.166. The 

Tailoring Rule did amend section 

51.166, but, again, those amendments 

did not impose PSD applicability on 


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69EPA likewise did not reopen this issue in this 

rulemaking. 

GHG-emitting sources; rather, they 

clarified the date of PSD applicability 

for GHG-emitting sources and provided 

a timetable for phasing-in PSD 

applicability. Therefore, no state is 

required ‘‘by reason of an amendment to 

* * * section [51.166]’’ to revise its SIP 

to apply PSD to GHG-emitting sources, 

and as a result, any three-year delay in 

section 51.166 does not apply to PSD 

applicability for GHG-emitting sources. 

3. Comments on Stationary Sources’ 

Ability To Rely on Approved State SIP 

Several industry commenters stated 

that in light of their contention that the 

PSD program is not self-executing, as 

discussed earlier in this preamble, then 

it follows that stationary sources do not 

violate the CAA if they get permits in 

accordance with the requirements of an 

approved state SIP, and they may 

lawfully construct or modify in 

accordance with the terms of those 

permits, even though those permits do 

not cover their GHG emissions. 

According to these commenters, sources 

in Texas need only look to the content 

of Texas’s existing SIP in determining 

the permitting requirements with which 

they must comply and sources in Texas 

can obtain permits now, without 

addressing GHGs, and lawfully 

construct or modify in accordance with 

those permits. One commenter states 

that CAA Section 113(a)(1) ‘‘provides a 

shield to these sources so long as they 

comply with the applicable SIP.’’ 

Commenters cited the recent decision of 

the 7th Circuit, United States v. Cinergy 

Corporation, 623 F.3d 455 (7th Cir. 

2010) to support the opinion that 

actions taken in compliance with an 

approved SIP are valid. 

4. EPA Response 

Here, too, EPA stated in the proposal 

for this rulemaking that because EPA 

addressed this comment in earlier 

rulemakings on which this rulemaking 

is based—including the Tailoring Rule 

and the GHG PSD SIP Call—EPA was 

not soliciting comment on this issue and 

was not required to respond to such 

comments. 75 FR at 82,388/2, see 75 FR 

31,514 (June 3, 2010) and 75 FR 77,698 

(December 13, 2010). Even so, for the 

sake of completeness, and without reopening this issue in this rulemaking, 

EPA provides the following response: 

EPA disagrees with the comment. As we 

stated earlier in this preamble, EPA has 

long interpreted the PSD applicability 

provisions in the CAA to be selfexecuting,69 that is, they apply by their 

terms so that a source that emits any air 

pollutant subject to regulation becomes 

subject to PSD—and, therefore, cannot 

lawfully construct or modify without 

obtaining a PSD permit—and these 

provisions apply by their terms in this 

manner regardless of whether the state 

has an approved SIP PSD program. 

What is more, until an applicable 

implementation plan is in place—either 

an approved SIP or a FIP—no permitting 

authority is authorized to issue a permit 

to the source. 

In the recent Cinergy decision, the 7th 

Circuit confronted a case that, at the 

district court level, involved both 

nonattainment NSR and PSD claims, 

with the appeal involving a substantive 

nonattainment NSR issue and an 

evidentiary PSD issue. However, in its 

opinion, the 7th Circuit described the 

substantive nonattainment NSR issue as 

if it applied to both nonattainment NSR 

and PSD. On that issue, the Court held 

that sources could continue to abide by 

permitting requirements in an existing 

SIP until amended, even if that SIP does 

not comport with the law. Again, 

notwithstanding the Court’s broader 

description of the case, that holding 

applied only to the nonattainment NSR 

claims because, again, only those claims 

were before the Court on that issue. 

United States v. Cinergy Corp., 623 F.3d 

455 (7th Cir. 2010). In stark contrast to 

the nonattainment provisions actually at 

issue in Cinergy—which are not selfexecuting and must therefore be 

enforced through a SIP—PSD is selfexecuting; it is the statute (CAA section 

165), not just the SIP, that prohibits a 

source from constructing a project 

without a permit issued in accordance 

with the Clean Air Act. 

B. Determination That EPA’s Previous 

Approval of Texas’s PSD Program was 

in Error 

In this action, EPA is determining that 

EPA’s previous approval of Texas’s PSD 

program was in error under CAA section 

110(k)(6). In applying CAA section 

110(k)(6), EPA must first ‘‘determine[] 

that the Administrator’s action 

approving * * * [the Texas PSD 

program] was in error * * *.’’ EPA has 

determined that the Texas PSD program 

had flaws at the time Texas submitted 

it and EPA approved it, so that EPA’s 

approval was in error. 

1. Gaps in Texas’s PSD Program 

Concerning Application of PSD to 

Pollutants Newly Subject to Regulation 

and Concerning Assurances of Legal 

Adequacy 

Texas’s PSD program, although 

approved by EPA, contained important 

gaps concerning the application of PSD 

to pollutants newly subject to 

regulation, including non-NAAQS 

pollutants, and Texas’s legal authority 

for doing so. 

a. Gaps in Texas’s PSD Program at the 

Time of EPA Approval 

The application of the PSD program to 

pollutants newly subject to regulation, 

including non-NAAQS pollutants, is a 

key component of the program. As 

noted earlier in this preamble, it is 

EPA’s long-standing position that PSD 

applies to all such pollutants, and most 

of the states’ PSD programs do apply to 

such pollutants automatically, as soon 

as those pollutants become subject to 

regulation. 

In particular, as noted previously, 

EPA made clear to Texas during 1980 

and again during 1983 that PSD applies 

to non-NAAQS pollutants. Because 

Texas’s PSD program, unlike that of 

most states, did not automatically apply 

to such pollutants, it was important that 

during the time when Texas submitted 

SIP revisions and EPA acted on them, 

1985–1992, that Texas address the 

application of PSD to pollutants newly 

subject to regulation, including nonNAAQS pollutants. 

It is clear from the record that both 

Texas and EPA were well aware that the 

Texas PSD rules’ IBR of EPA PSD 

regulatory requirements did not 

automatically update. Indeed, when 

EPA promulgated the NAAQS for PM10, 

a previously unregulated pollutant, and 

thereby subjected that pollutant to PSD 

for the first time, Texas revised its PSD 

rules to update the IBR and thereby 

assure that the state PSD program 

applied to PM10.

Had Texas recognized that following 

approval of its PSD program, EPA 

would in all likelihood continue to 

subject previously unregulated 

pollutants to regulation, and therefore to 

PSD for the first time, Texas could have 

addressed how it would handle that 

situation. For example, Texas could 

have provided assurances that the state 

would apply PSD to such pollutants, 

and could have included those 

assurances in the form of a SIP revision 

or as a separate letter. Texas could also 

have provided information as to the 

method and timing for applying PSD to 

such pollutants. The most likely method 

would be through a separate SIP 

revision, which would apply PSD 

specifically with respect to that 

pollutant. By comparison, as noted 

earlier in this preamble, Texas 

committed to submit a SIP revision if a 

SIP inadequacy led to an increments 

violation. Alternatively, another method 

would be to adopt the approach of most 

other states and adopt a SIP revision to 

update the program to apply 


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70Letter to Steve Spaw, Executive Director, Texas 

Air Control Board, from A. Stanley Meiburg, 

Director, Air Pesticides, and Toxics Division, 

Region 6, USEPA, Request for Commitments for 

Prevention of Significant Deterioration (PSD) 

Program. March 30, 1992. 

automatically to any pollutant newly 

subject to regulation. 

In addition, depending on how it 

addressed the need to update its PSD 

program to apply to pollutants newly 

subject to regulation, Texas could have 

addressed the timing of that action. The 

timing would most likely relate to the 

time necessary to adopt and submit a 

SIP revision. This timing issue is 

important because the sources emitting 

pollutants are subject to PSD under the 

CAA as soon as the pollutants become 

subject to regulation, but if the SIP PSD 

program does not automatically apply to 

the sources, then the state does not have 

authority to issue permits to the sources 

as soon as the sources become required 

to obtain the permits. 

However, there is no indication in the 

record of Texas’s SIP submissions that 

Texas specifically addressed this issue 

of the treatment of pollutants that would 

newly become subject to PSD after 

Texas’s PSD SIP was approved, or that 

Texas provided any such information as 

to method or timing. Nor is there any 

indication in the record that during this 

1985–92 period, EPA identified this 

issue and sought such information from 

Texas. As noted elsewhere in this 

preamble, although both Texas and EPA 

were well aware that the Texas SIP did 

not automatically update to include 

pollutants newly subject to regulation, 

both failed to look down the road and 

anticipate that EPA would in all 

likelihood newly subject more 

pollutants to regulation. As noted 

elsewhere in this rulemaking, because 

the SIP did not address PSD 

applicability to pollutants newly subject 

to regulation, the SIP did not meet CAA 

requirements. 

Texas did provide the 1987 Texas 

PSD Commitments Statement, in which 

Texas agreed to ‘‘implement and enforce 

the federal requirements for [PSD] as 

specified in [EPA regulations] by 

requiring all new major stationary 

sources and major modifications to 

obtain air quality permits as provided in 

TACB regulation VI, Control of Air 

Pollution by Permits for New 

Construction and Modification.’’ 

However, this 1987 statement does not 

specifically address the application of 

PSD to pollutants newly subject to 

regulation. As just quoted, it commits 

TACB to require ‘‘all new major 

stationary sources and major 

modifications to obtain air quality 

permits as provided in TACB regulation 

VI* * *’’, but that regulation VI does 

not automatically update, and therefore 

does not apply to pollutants newly 

subject to regulation, and does not 

further address such pollutants. 

Texas also provided the 1989 Texas 

PSD Commitments Letter, in which 

Texas generally committed ‘‘to 

implement EPA requirements relative to 

[PSD].’’ However, as quoted previously, 

this phrasing is general and therefore 

cannot be read to commit to apply PSD 

to pollutants newly subject to 

regulation, including non-NAAQS 

pollutants. Nor did the letter identify 

the method and timing for doing so. 

Accordingly, we do not read this letter 

as a commitment by Texas to apply PSD 

to each newly regulated pollutant, 

including non-NAAQS pollutants, 

whether through a SIP revision or some 

other method, or on any particular timetable. Moreover, although EPA approved 

the Texas PSD program in reliance on 

the letter, EPA indicated, in the final 

approval preamble, that the scope and 

binding impact of the letter were limited 

and that Texas retained discretion in 

implementing the PSD program. 

In approving Texas’s rule, EPA did 

not recognize that Texas’s SIP did not 

address pollutants newly subject to 

regulation. In its 1992 approval 

rulemaking, EPA noted that ‘‘any 

fundamental changes in the 

administration of PSD would have to be 

accomplished through amendments to 

the regulations in 40 CFR §§ 52.21 and 

51.166, and subsequent SIP revisions,’’ 

and added: 

The EPA did not intend to suggest that 

Texas is required to follow EPA’s 

interpretations and guidance issued under 

the Act in the sense that those 

pronouncements have independent status as 

enforceable provisions of the Texas PSD SIP, 

such that mere failure to follow such 

pronouncements, standing alone, would 

constitute a violation of the Act* * *. 

* * *PSD–SIP approved states remain free 

to follow their own course, provided that 

state action is consistent with the letter and 

spirit of the SIP, when read in conjunction 

with the applicable statutory and regulatory 

provisions. 

57 FR 28,094–28,095 (June 24, 1992). 

EPA made these statements in response 

to comments that EPA should not 

require that (i) the Texas PSD program 

must automatically incorporate any 

revision to the PSD program that EPA 

might adopt, such as a revision to how 

the central technological requirement— 

best available control technology 

(BACT)—is determined; or (ii) that the 

Texas PSD program incorporate any 

new interpretation or guidance that EPA 

may issue with respect to PSD. Rather, 

according to these statements, EPA 

would revise the PSD program through 

regulatory changes and Texas would 

adopt them through SIP revisions, and 

Texas retained discretion as to whether 

to follow revisions to EPA interpretation 

or guidance. However, these statements 

do not concern EPA’s newly subjecting 

pollutants to regulation, and thereby 

triggering PSD requirements for those 

pollutants, because that action does not 

constitute a ‘‘fundamental change[] in 

the administration of PSD * * * 

accomplished through amendments to 

the regulations in 40 CFR 52.21 and 

51.166. * * *.’’ Nor is that action any 

type of new interpretation or guidance 

for the PSD program itself. Rather, that 

action is a regulatory action outside the 

PSD program that has the effect of 

newly subjecting a pollutant to 

regulation; does not alter the underlying 

requirements of the PSD program; and 

instead, simply makes an incremental 

addition (however large the increment 

may be) to the types of pollutants 

subject to the existing PSD program. 

In addition, the rulemaking record for 

Texas’s PSD program does not indicate 

that Texas provided, as required under 

CAA section 110(a)(2)(E)(i), assurances 

that Texas had adequate legal authority 

to carry out the PSD program, including, 

insofar as relevant for this rulemaking, 

applying PSD to pollutants newly 

subject to regulation, among them nonNAAQS pollutants. Some 15 years 

previously, in Texas’s 1972 submission 

of its original SIP, the state had 

provided assurances of legal authority to 

carry out the SIP, and EPA had 

approved those assurances. But the 

record for the PSD SIP submission does 

not indicate whether, or how, that legal 

authority applied to PSD applicability to 

such pollutants. In submitting the PSD 

SIP program, the TACB provided 

general references to legal authority, but 

the TACB did not indicate whether PSD 

applies to such pollutants either. Nor 

did the 1989 Texas PSD Commitments 

Letter specifically identify legal 

authority to apply PSD to such 

pollutants. Nor did the assurance of 

legal authority to apply the Texas PSD 

program to large municipal waste 

combustors, as required by the 1990 

CAA Amendments, assurances which 

Texas apparently made in a 1992 

conference call with EPA Region 6 

officials, and which were referenced in 

a letter from the Region to TACB, 

address legal authority to apply PSD to 

pollutants that newly become subject to 

PSD as a result of EPA regulation.70

Therefore, the Texas PSD SIP 

submittal contained gaps: it did not 

address the application of PSD to 

pollutants newly subject to regulation, 


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71See Texas ‘‘Motion to Stay Three GHG Actions’’ 

27, Coalition for Responsible Regulation v. EPA, No. 

09–1322 (and consolidated cases). 

72See 43 FR 26,380, 26,403/3, 26,406 (June 19, 

1978) (promulgating 40 CFR 51.21(b)(1)(i)) and 42 

FR 57,479, 57,480, 57,483 (November 3, 1977) 

(proposing 40 CFR 51.21(b)(1)(i)) (applying PSD 

requirements to a ‘‘major stationary source’’ and 

defining that term to include sources that emit 

specified quantities of ‘‘any air pollutant regulated 

under the Clean Air Act’’). 

73 It should be noted that Texas has applied its 

PSD program to non-NAAQS pollutants because 

Texas has IBR’d EPA’s PSD regulatory requirements 

and those requirements apply to non-NAAQS 

pollutants. However, as noted earlier, Texas has 

made clear that it has no intention of submitting a 

SIP revision to apply PSD to GHGs. All this is 

consistent with the view described previously that 

Texas interprets its PSD applicability provision to 

authorize it to apply PSD to non-NAAQS pollutants 

at Texas’s discretion, but that Texas does not view 

itself as required to apply PSD to non-NAAQS 

pollutants. 

74By the same token, we see nothing in these 

recent statements to indicate that Texas views itself 

as rescinding any pre-existing understanding that it 

would apply PSD to each such pollutant. 

including non-NAAQS pollutants; and 

it did not include any information 

concerning Texas’s methods or timing 

for doing so. Nor did the program 

provide assurances that the state had 

adequate legal authority to apply PSD to 

such pollutants. 

b. Recent Statements by Texas That 

Confirm the Gaps in Texas’s PSD 

Program 

Texas has recently made several 

statements that confirm that at the time 

EPA approved the state’s PSD program, 

that program had the gaps described 

previously. 

(1). Gap Concerning Application of PSD 

to All Pollutants Newly Subject to 

Regulation, Including Non-NAAQS 

Pollutants 

First, Texas has made clear its view 

that it is not required to apply PSD to 

non-NAAQS pollutants that are newly 

subject to regulation, including GHGs. 

Specifically, in its August 2, 2010, 60- 

day letter, Texas stated that it interprets 

the CAA PSD applicability provisions to 

apply only to NAAQS pollutants, and 

therefore to not include non-NAAQS 

pollutants, among them GHGs. Texas 

asserted that ‘‘the only sensible 

interpretation of the CAA’’ is that PSD 

applies to only NAAQS pollutants. 

Texas 60-day letter, p. 4. Indeed, in its 

court challenge to EPA’s four GHG 

rules, Texas stated that its interpretation 

is mandated under Chevron step 1. 

There, Texas stated that EPA’s 

‘‘interpretation of the CAA [that PSD 

applies to non-NAAQS pollutants] is 

not entitled to deference because the 

text of the statute is unambiguous. 

Chevron, U.S.A. v. NRDC, 467 U.S. 837, 

842 (1984) (the Agency must give effect 

to the unambiguously expressed intent 

of Congress).’’ 71 As noted previously, 

EPA responded at length to this 

argument in the Tailoring Rule and in 

EPA’s response in the court challenge to 

EPA’s GHG rules. EPA asserts that the 

CAA mandates that PSD apply to nonNAAQS pollutants, including GHGs, 

once they become subject to regulation; 

and EPA is not reopening this issue on 

the merits in this rulemaking. 

For present purposes, however, what 

is important is that Texas takes the 

position that under a Chevron step 1 

reading of the CAA, the PSD program 

does not apply to non-NAAQS 

pollutants. This position has important 

ramifications for how Texas must 

interpret EPA’s PSD applicability 

regulations and for the meaning of 

Texas’s SIP PSD applicability 

provisions. As noted previously, under 

EPA’s current regulations, PSD applies 

to ‘‘any pollutant that otherwise is 

subject to regulation under the [CAA].’’ 

40 CFR 52.166(b)(49)(iv). These 

regulations have read this way since 

they were revised in EPA’s 2002 NSR 

Reform Rule, and the regulations that 

predated them were phrased in much 

the same way: They applied PSD to ‘‘any 

air pollutant regulated under the Clean 

Air Act.’’ 72 These regulations are based 

on the CAA PSD applicability 

requirements, and as a result, cannot 

apply PSD to any pollutants that the 

CAA does not itself subject to PSD. 

Accordingly, although Texas did not 

specifically address the meaning of 

EPA’s regulations in its 60-day letter or 

court filings, it must be that in Texas’s 

view, these EPA regulations may 

lawfully apply PSD to only NAAQS 

pollutants. 

Texas’s EPA-approved SIP PSD 

applicability provisions apply PSD to 

‘‘any air pollutant subject to regulation 

under the [Clean Air] Act.’’ Although 

these Texas provisions mirror EPA’s 

provisions—which, again, Texas 

appears to interpret as limited to 

applying PSD only to NAAQS 

pollutants—Texas is authorized to apply 

its provisions more expansively than the 

EPA regulations. This is because a state 

must comply with CAA requirements as 

a minimum, but retains authority to 

impose additional or more stringent 

requirements. CAA section 116. 

Therefore, it is in accordance with 

Texas’s view that the CAA and EPA 

regulatory requirements for PSD 

applicability be limited to NAAQS 

pollutants, that Texas would 

nevertheless consider itself 

authorized—but not required—to apply 

its PSD program to particular nonNAAQS pollutants. This position would 

allow Texas, in effect, to choose which 

non-NAAQS pollutants to subject to 

PSD, and which not. 

In fact, Texas has clearly stated that 

it does not consider itself required to 

apply its PSD program to one nonNAAQS pollutant in particular: GHGs. 

In its 60-day letter, Texas stated: ‘‘Texas 

has neither the authority nor the 

intention of interpreting, ignoring, or 

amending its laws in order to compel 

the permitting of greenhouse gas 

emissions.’’ Texas 60-day letter, at 1. 

Texas’s letter went on to provide 

numerous reasons for why it did not 

believe EPA lawfully subjected GHGs to 

PSD; why, in any event, EPA was 

required to allow states more time 

before PSD would apply to GHGemitting sources; and, as noted 

previously, why, in any event, Texas’s 

SIP does not automatically update to 

apply PSD to newly regulated 

pollutants. Id. at 5. 

With this statement—that ‘‘Texas has 

neither the authority nor the intention 

of interpreting, ignoring, or amending 

its laws in order to compel the 

permitting of greenhouse gas 

emissions’’– Texas has made clear that 

it does not view itself as obligated to 

apply PSD to GHGs under the CAA. 

Thus, this statement is fully consistent 

with, and highlights, Texas’s view that 

it is not obligated to apply PSD to each 

newly regulated non-NAAQS, 

including, of course, GHGs.73

These statements from Texas are 

significant because they confirm that 

Texas’s PSD program, as approved by 

EPA, had an important gap: Texas did 

not address the applicability of its PSD 

program to pollutants newly subject to 

regulation, including non-NAAQS 

pollutants, such as by providing 

assurances that Texas would take action 

to apply PSD to such pollutants or 

describing the methods (such as SIP 

revision) and timing for doing so. 

Moreover, Texas’s recent statements are 

consistent with the view that Texas’s 

silence on the subject at the time of the 

PSD SIP action means that Texas did 

not, at that time, view itself as obligated 

to apply PSD to each pollutant.74

In particular, Texas’s recent statement 

that the CAA PSD provisions are clear 

by their terms, as a matter of Chevron 

step 1, that they do not apply to nonNAAQS pollutants, suggests that Texas 

would have viewed the CAA PSD 

provisions the same way at the time 

Texas submitted its PSD program. As 

noted earlier, the Texas Attorney 

General and the Chairman of the Texas 

Commission on Environmental Quality, 

who are the joint signatories of Texas’s 


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75 57 FR at 28,095/2, 28,096/1. 

60-day letter, are of the view that ‘‘[t]he 

only sensible interpretation of the Clean 

Act’’ is that PSD applies only to NAAQS 

pollutants, and not non-NAAQS 

pollutants. Texas 60-day letter, p. 4. 

Texas has confirmed its reading—and 

clarified that it is based on a Chevron 

step 1 interpretation—in filings before 

the DC Circuit. The fact that these high 

state officials view this reading of the 

CAA as, again, ‘‘[t]he only sensible 

reading,’’ indicates that in the past, 

Texas is less likely to have adopted the 

opposite reading, which would be that 

the CAA mandates that PSD applies to 

non-NAAQS pollutants. Statutory 

provisions whose meaning is clear on 

their face, at least to a particular reader, 

would not be expected to have had a 

different or uncertain meaning to that 

same reader at an earlier point in time. 

By the same token, Texas’s insistence, 

noted previously, that it does not have 

the intention or authority to apply PSD 

to one non-NAAQS in particular, GHGs, 

suggests that Texas could well have 

expressed the same view, had the issue 

arisen, at the time EPA approved 

Texas’s PSD program. 

We further note that Texas itself 

appears to take the position that an 

agency’s present interpretation of its 

regulations should be presumed to have 

been the agency’s past interpretation of 

those regulations, so that Texas’s 

current interpretation that its PSD 

program does not apply to at least one 

non-NAAQS, GHGs, should be 

presumed to be Texas’s interpretation of 

its PSD program in the past, including 

at the time Texas submitted its program 

as a SIP revision to EPA and EPA 

approved it. Specifically, in its 60-day 

letter, Texas noted that in the Tailoring 

Rule, EPA asked states to consider 

whether their SIPs that include the term 

‘‘subject to regulation’’ can be 

interpreted to incorporate the Tailoring 

Rule thresholds on grounds that the 

state interprets that term as being 

sufficiently open-ended. 75 FR 51,581/ 

2. Texas stated, 

In the Tailoring Rule you have asked TCEQ 

to report to you by August 2, 2010, whether 

it would ‘‘interpret’’ the undefined phrase 

‘‘subject to regulation’’ in TCEQ Rule 116.12 

consistent with the newly promulgated 

definition in EPA Rule 51.166, in all its 

specifics and particulars. That is, you have 

effectively requested that Texas agree to 

regulate greenhouse gases in the exact 

manner and method proscribed by the EPA. 

In other words, you have asked Texas to 

agree that when it promulgated its air quality 

permitting program rules for pollutants 

‘‘subject to regulation’’ in 1993, that Texas 

really meant to define the term ‘‘subject to 

regulation’’ as set forth in the dozens of 

paragraphs and subparagraphs of EPA Rule 

51.166, first promulgated in 2010. 

Texas 60-day letter, p. 3. In these 

statements, Texas appears to reveal 

Texas’s own understanding of the 

circumstances under which Texas can 

be said to give the term ‘‘subject to 

regulation’’ a particular interpretation, 

and that is if Texas interpreted that term 

that same way at the time that Texas 

first promulgated the term in 1993. By 

that same logic, Texas’s position, as 

stated in its 60-day letter, that it ‘‘has 

neither the authority nor the intention 

of interpreting, ignoring, or amending 

its laws in order to compel the 

permitting of greenhouse gas emissions’’ 

would have applied to ‘‘its laws’’— 

including the SIP PSD requirements—at 

the time that Texas adopted those rules. 

Therefore, it seems reasonable to 

conclude that just as Texas does not 

currently view its PSD program as 

applying to all newly regulated nonNAAQS pollutants, Texas did not, at the 

time it submitted and EPA approved its 

PSD program, view its PSD program as 

applying to all newly regulated nonNAAQS pollutants. 

By the same token, Texas’s recent 

statements also confirm that the 

assurances Texas provided in its 1989 

Texas PSD Commitments Letter cannot 

be interpreted as having committed 

Texas to apply PSD to all pollutants 

newly subject to regulation, including 

non-NAAQS pollutants. The assurances, 

by their terms, were phrased generally 

and did not address the application of 

PSD to such pollutants; and EPA, in the 

preamble for the final approval of 

Texas’s PSD SIP, indicated that the 

scope and binding impact of the 

assurances were limited.75 Texas’s 

recent direct statements that PSD does 

not cover non-NAAQS pollutants 

indicates that the generally phrased 

assurances in the letter, whatever they 

meant, did not mean that Texas would 

apply PSD to each newly regulated 

pollutant, including non-NAAQS 

pollutants. 

As a result, it stands to reason that at 

the time Texas submitted its PSD 

program, Texas did not view the CAA 

as mandating the application of PSD to 

at least certain pollutants newly subject 

to regulation, non-NAAQS pollutants. 

But at a minimum, it can be said that 

Texas’s PSD program contained a gap: 

EPA required that PSD apply to each 

pollutant newly subject to regulation, 

including non-NAAQS pollutants; 

Texas’s program applied only to 

pollutants already subject to regulation 

at the time Texas adopted its program, 

not to subsequently regulated 

pollutants, including non-NAAQS; and 

Texas did not address its program’s 

applicability to such pollutants, 

including how or when its program 

would so apply. This gap is significant 

because it facilitates Texas’s current 

position, with which EPA disagrees, 

that PSD does not apply to non-NAAQS 

pollutants. 

(2). Gap Concerning Assurances of 

Adequate Legal Authority 

Texas’s statement in its 60-day letter 

that it ‘‘has neither the authority nor the 

intention of interpreting, ignoring, or 

amending its laws in order to’’ apply 

PSD to GHG-emitting sources also 

highlights that Texas’s PSD program had 

a gap in its failure to provide ‘‘necessary 

assurances’’ of adequate legal authority 

to carry out the PSD program. 

It is possible that at the time that 

Texas submitted its PSD program, Texas 

considered itself under the same limits 

in its legal authority. At a minimum, in 

light of these recent statements that it 

does not have authority to apply PSD to 

at least one newly regulated, nonNAAQS, GHGs, it is apparent that at the 

time that Texas submitted its PSD 

program, Texas did not provide the 

‘‘necessary assurances’’ that it ‘‘will have 

adequate * * * authority under State 

* * * law to carry out such 

implementation plan (and is not 

prohibited by any provision of * * * 

State law from carrying out such 

implementation plan or portion 

thereof).’’ CAA section 110(a)(2)(E)(i) 

(emphasis added). ‘‘[C]arrying out such 

implementation plan’’ includes, in the 

case of the Texas PSD SIP program, fully 

implementing the SIP in a manner 

consistent with the CAA, and that 

includes the applicability of PSD to 

each pollutant newly subject to 

regulation, including non-NAAQS 

pollutants. 

2. Flaws in PSD Program 

The Texas PSD program’s gaps— 

which are, again, that Texas did not 

address the applicability of PSD to all 

pollutants newly subject to regulation, 

including non-NAAQS pollutants; and 

Texas did not provide assurances of 

adequate legal authority to do so—mean 

that the state’s PSD program has flaws. 

These flaws were present at the time 

that EPA approved Texas’s PSD 

program. Moreover, these flaws are 

significant. They have figured 

prominently into the present situation 

in which EPA takes the position that 

Texas is obligated under the CAA and 

EPA regulations to apply its PSD 

program to a newly regulated 

pollutant—GHGs—but Texas takes the 

opposite position. 


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a. Comments on the Flaws in PSD 

Program 

Several commenters, including both 

the Texas Commission on 

Environmental Quality (TCEQ) and the 

Texas Attorney General, object to EPA’s 

determination that the Texas SIP is 

flawed. TCEQ comments that nothing in 

‘‘ * * * the CAA or federal PSD rules 

require that state PSD programs apply to 

pollutants newly subject to regulation.’’ 

The Texas Attorney General states that 

40 CFR 51.166 does not require 

automatic updating of SIPs to 

incorporate pollutants that subsequently 

become subject to regulation. 

b. Response to Comments 

EPA disagrees with these comments. 

Contrary to the TCEQ’s comments, as 

discussed elsewhere in this rulemaking 

preamble, the PSD requirements in the 

CAA and regulations do require that 

PSD SIPs address the applicability of 

PSD to pollutants newly subject to 

regulation. As discussed previously, the 

CAA PSD provisions and EPA’s PSD 

regulations are clear that PSD applies to 

each newly regulated pollutant, whether 

a NAAQS pollutant or a non-NAAQS 

pollutant. Moreover, the CAA is clear 

that SIPs must include provisions to 

assure that CAA requirements are met. 

See CAA section 110(a)(2)(J) (each SIP 

must ‘‘meet the applicable requirements 

of * * * part C * * * (relating to 

prevention of significant deterioration of 

air quality * * *)’’; CAA section 161 

(‘‘each applicable implementation plan 

shall contain emission limitations and 

such other measures as may be 

necessary, as determined under 

regulations promulgated under this part, 

to prevent significant deterioration of air 

quality in each region [to which PSD 

applies]’’). Accordingly, each PSD SIP 

must include provisions that address 

how PSD will apply to pollutants newly 

subject to regulation. As noted earlier in 

this preamble, there are several different 

ways for SIP to address PSD 

applicability to such pollutants, but 

SIPs must adopt one of those ways. 

With respect to the Texas Attorney 

General, the comment that EPA’s 

regulations do not require automatic 

updating of SIPs to incorporate such 

pollutants misses the point. In the 

Interim Final Rule and the proposal, 

EPA did not identify the gap in Texas’s 

SIP PSD provisions as based on the lack 

of automatic updating to apply PSD to 

each pollutant newly subject to 

regulation. Rather, EPA identified the 

gap as the failure of the State, at the time 

it submitted and EPA approved the PSD 

program, to address such pollutants. 

The State could have specifically 

acknowledged the issue of the 

applicability of PSD to newly regulated 

pollutants and addressed that issue in 

several different ways. Providing an 

automatic updating mechanism is one 

way, which is what most of the other 

states do. Second, the State could have 

committed, in either the SIP itself or in 

a letter accompanying the SIP submittal, 

that the State would adopt and submit 

for approval SIP revisions to apply PSD 

to newly regulated pollutants, and the 

State could have indicated a schedule 

for it to do so. Third, it is possible that 

more general assurances by the State to 

address the issue could have passed 

muster. In addition, there may be other 

ways to address this issue. The record 

does not indicate that Texas specifically 

identified the issue or identified any 

ways that Texas would address the 

issue. Moreover, as discussed earlier in 

this preamble, Texas failed to 

demonstrate that it had adequate legal 

authority to regulate these pollutants. 

3. EPA’s Error in Approving Texas’s 

PSD Program 

In this rulemaking, EPA is 

‘‘determin[ing]’’ that EPA’s action fully 

approving Texas’s PSD program was ‘‘in 

error’’ within the meaning of CAA 

section 110(k)(6). This section contains 

EPA’s basis for that determination. 

a. CAA Section 110(k)(6) Error 

Correction 

Under the familiar Chevron two-step 

framework for interpreting 

administrative statutes, an agency must, 

under Chevron step 1, determine 

whether ‘‘Congress has directly spoken 

to the precise question at issue.’’ If so, 

‘‘the court, as well as the agency, must 

give effect to the unambiguously 

expressed intent of Congress.’’ However, 

under Chevron step 2, if ‘‘the statute is 

silent or ambiguous with respect to the 

specific issue, the question for the court 

is whether the agency’s answer is based 

on a permissible construction of the 

statute.’’ Chevron U.S.A. Inc. v. NRDC, 

467 U.S. 837, 842–43 (1984). 

As noted previously, the term ‘‘error’’ 

in CAA section 110(k)(6) is not defined 

and, as a result, should be given its 

ordinary, everyday meaning. The 

dictionary definition of ‘‘error’’ is ‘‘a 

mistake’’ or ‘‘the state or condition of 

being wrong in conduct or judgment,’’ 

Oxford American College Dictionary 467 

(2d ed. 2007); or ‘‘1) an act, assertion, or 

belief that unintentionally deviates from 

what is correct, right or true 2) the state 

of having false knowledge * * * 4) a 

mistake * * * .’’ Webster’s II New 

Riverside University Dictionary 442 

(Houghton Mifflin Co. 1988). These 

definitions are broad, and include all 

unintentional, incorrect or wrong 

actions or mistakes. 

Moreover, CAA section 110(k)(6) 

authorizes EPA to ‘‘determine[]’’ that its 

action was in error, and does not direct 

or constrain that determination in any 

manner. That is, the provision does not 

identify any factors that EPA must, or 

may not, consider in making the 

determination. This further indicates 

that this provision confers broad 

discretion upon EPA. 

b. Gaps in Texas PSD Program 

As previously discussed, the Texas 

SIP PSD program was flawed because it 

contained gaps: Texas did not address 

the applicability of PSD to all pollutants 

newly subject to regulation, including 

non-NAAQS pollutants; and Texas did 

not provide assurances of adequate legal 

authority to do so. EPA did not address 

these gaps in its action on Texas SIP 

PSD program and instead, EPA fully 

approved the PSD program. 

Therefore, EPA’s action in fully 

approving Texas’s SIP PSD program in 

the face of these flaws was ‘‘in error’’ 

under CAA section 110(k)(6), in 

accordance with Chevron step 1. 

‘‘[E]rror’’ should be defined broadly to 

include any mistake, and approval of a 

flawed SIP is a mistake. Moreover, this 

flaw is significant because it affects the 

applicability of the PSD program to a 

pollutant and, as a result, to an entire 

set of sources. 

Even if the term ‘‘error’’ is not 

considered unambiguously to 

encompass, under Chevron step 1, the 

mistake that EPA made in approving the 

Texas PSD SIP, and instead is 

considered ambiguous on this question, 

then under Chevron step 2 EPA has 

sufficient discretion to determine that 

its approval action meets the definition 

of ‘‘error.’’ That is, under CAA section 

110(k)(6), the breadth of the term ‘‘error’’ 

and of the authorization for EPA to 

‘‘determine[]’’ when it made an error, 

mean that EPA has sufficient discretion 

to identify the gaps in Texas’s PSD 

program as flawed and to identify EPA’s 

action in approving Texas’s PSD SIP in 

the face of those flaws as an error. 

c. Comments and Responses on the Use 

of CAA § 110(k)(6) 

Comment: One commenter supported 

EPA’s use of CAA section § 110(k)(6) to 

correct its previous approval of the 

Texas PSD program. This commenter 

asserted that the use of this mechanism 

is appropriate in this case, where 

serious flaws in Texas’s SIP have 

become glaringly apparent, and, if left 

uncorrected, would cause immediate 

harm. EPA agrees with this commenter’s 

assessment that this action is necessary 


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76By comparison, if the original action were not 

a notice-and-comment action (such as a 

classification under CAA section 172(a)(1)(B)), then 

the correction must follow whatever process 

applied to the original action. 

to correct this error in the Texas 

program. 

Several other commenters, however, 

challenged the use of section 110(k)(6) 

in this instance. Commenters stated that 

section 110(k)(6) of the Act has been 

understood and was intended by 

Congress to be used as authority to make 

corrections of a ‘‘technical’’ or 

ministerial nature, such as 

‘‘typographical errors.’’ This section was 

not, according to commenters intended 

as a means to make unilateral, 

substantive changes in SIPs or major 

policy changes. These commenters view 

EPA’s action here as directly contrary to 

the Act’s cooperative federalism 

scheme. 

Response: For the reasons noted 

earlier in this preamble, the natural 

meaning of the term ‘‘error’’ in the error 

correction provision is broad and as a 

result, the provision applies by its terms 

to any mistake. The explicit legislative 

history of the provision—what Congress 

said in the various reports and 

statements accompanying its passages— 

is sparse and does not illuminate its 

meaning. Because there is nothing in the 

statute or legislative history that 

suggests that Congress intended a 

meaning narrower than the natural 

meaning of the term, the natural 

meaning of the term controls. 

Commenters’ assertions that this 

provision is limited to ‘‘technical’’ errors 

or ‘‘typographical errors’’ are conclusory 

and wholly unsupported. 

For the reasons discussed elsewhere 

in this preamble, Texas’s SIP was 

flawed and as a result, EPA’s action in 

approving that flawed SIP was in error. 

As a result, this rulemaking action is 

simply the correction of an error, as 

authorized under CAA § 110(k)(6). 

Contrary to some comments, this action 

is not based on a policy shift in EPA’s 

administration of the PSD program. Nor 

does this action upset federalism 

concerns or constitute a claim of 

authority to unilaterally revise any 

action on any SIP submittal. EPA does 

not read section 110(k)(6) to provide 

unlimited discretion to act on SIP 

submissions, only to provide authority 

to make error corrections. 

Comment: Commenters went on to 

assert that other historical uses of CAA 

section 110(k)(6) were uncontroversial 

edits to remove Federal enforceability of 

regulatory requirements that had been 

included or retained inadvertently and 

were made at the state’s request. In 

contrast, according to these 

commenters, this rule imposes new 

requirements contrary to the state’s 

wishes. 

Response: EPA’s previous use of the 

error correction provision makes clear 

that EPA has corrected errors many 

years after they occurred, and that EPA 

has corrected errors that are broader 

than merely technical or typographical 

errors. In addition, EPA’s most recent 

use of the error correction provision was 

in the PSD Narrowing Rule, in which 

EPA again corrected errors in SIP 

approvals that occurred many years ago, 

and which relied on as broad an 

application of section 110(k)(6) as in the 

present rulemaking. Moreover, in the 

GHG PSD Narrowing Rule, EPA relied 

on the error correction mechanism 

without having first been asked to do so 

by some of the affected states, and, in 

fact, in the face of negative comments by 

some of the affected states. Even so, the 

PSD Narrowing Rule was not challenged 

in Court by any party. 

In any event, for the reasons noted 

earlier in this preamble, EPA’s action in 

this rulemaking qualifies as an error 

correction within the meaning of CAA 

section 110(k)(6). Whether the affected 

state—or any other party—agrees or 

disagrees that the SIP that is the subject 

of the error correction is flawed is not 

a criteria under CAA section 110(k)(6). 

Comment: A commenter raised 

several concerns about EPA’s 

interpretation of other provisions of 

CAA section 110(k)(6). For convenience, 

the relevant provisions state: ‘‘Whenever 

the Administrator determines that the 

Administrator’s action approving, 

disapproving, or promulgating any plan 

or plan revision (or part thereof), area 

designation, redesignation, 

classification, or reclassification was in 

error, the Administrator may in the 

same manner as the approval, 

disapproval, or promulgation revise 

such action as appropriate without 

requiring any further submission from 

the State.’’ 

A commenter focused on the 

requirement that EPA’s action must be 

‘‘in the same manner’’ as the action that 

EPA is correcting, and argued that this 

requirement limits EPA to, as a 

substantive matter, applying the same 

standard to Texas’s SIP today as it did 

to the SIP when it was approved in 1992 

and using the same record; and as a 

procedural matter, taking the same 

action, which, in this case, prevents 

EPA from converting an approval to a 

disapproval. 

Response: EPA disagrees with this 

reading of the phrase ‘‘in the same 

manner.’’ This phrase is not defined in 

section 110(k)(6). As a matter of 

Chevron step 1, or, in the alternative, 

Chevron step 2, the phrase refers to 

Administrative Procedure Act or, if 

applicable, CAA section 307(d) 

procedures. Thus, if the original action 

were a notice-and-comment rulemaking 

under the Administrative Procedure 

Act, then the error correction must 

follow the same procedure.76 We see no 

basis for reading the phrase ‘‘in the same 

manner’’ more narrowly to limit an error 

correction of an approval to be only 

another approval, and not a disapproval. 

That strained reading is inconsistent 

with the purpose of the section, which 

is to allow for the correction of errors, 

a process that may well require 

reversing the initial action if found to be 

in error. Although EPA sees no basis for 

the substantive requirements that the 

commenter reads into the phrase, the 

record for the present action—which 

includes the relevant documents in the 

record for the 1992 approval—makes 

clear that EPA’s 1992 action was in 

error, and nothing in CAA section 

110(k)(6) limits the record for an error 

correction more narrowly. 

Comment: A commenter argued that 

EPA ignored the phrase ‘‘revise such 

action.’’ The commenter believes that 

section 110(k)(6) affords EPA no 

discretion to ‘‘revise’’ an approval action 

into a disapproval but instead limits the 

Agency to revising the contents of ‘‘such 

action’’ that it previously undertook. 

The commenter asserted that EPA does 

not ‘‘revise’’ an action by substituting 

another action for it; rather, EPA must 

take the same type of action, a reading 

reinforced by the requirement that the 

Agency act ‘‘in the same manner as the 

[original action].’’ The EPA may not 

‘‘reconsider’’ or ‘‘replace’’ a SIP-related 

action. The commenter indicated that in 

this way, section 110(k)(6) is not a 

mechanism for revisiting a decision but 

for correcting mistakes in an action— 

using this section to reverse an approval 

offends both the participation 

requirements and the principles of the 

Act’s SIP provisions. 

Response: Section 110(k)(6) 

authorizes EPA to ‘‘revise’’ the action it 

determines to be in error ‘‘as 

appropriate.’’ The term ‘‘revise’’ is not 

defined in section 110(k)(6). Its natural 

meaning is to ‘‘change’’ or ‘‘modify.’’ 

Webster’s II New Riverside University 

Dictionary (1988) at 1005. As a matter of 

Chevron step 1, or, in the alternative, 

Chevron step 2, the term is broad 

enough to encompass changing or 

modifying an approval to a disapproval. 

This is particularly so in light of the 

authorization under section 110(k)(6) to 

revise the action in error ‘‘as 

appropriate.’’ Used in this context, the 

term ‘‘appropriate’’ indicates EPA is 

under a constraint of reasonableness in 


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77The commenter added that it is not 

‘‘appropriate’’ to exercise section 110(k)(6)’s error 

correction provisions to change a SIP approval into 

a disapproval where the Agency has made no 

finding that the purported SIP submission 

deficiency will directly harm public health or 

welfare. Commenter appears to suggest that section 

110(k)(6) should be read to include the constraint 

that the provision is available only if EPA finds that 

error it seeks to correct. EPA sees no basis in the 

terms, legislative history, or logic of section 

110(k)(6), or in EPA’s previous error-correction 

actions, for reading this constraint into section 

110(k)(6). 

revising the action, but is not under the 

other constraints that commenter 

suggests. Thus, if EPA has a basis for 

revising an approval to a disapproval, 

then EPA may do so on grounds that 

this type of revision is ‘‘appropriate.’’ 

Comment: A commenter stated that 

EPA ignored the phrase ‘‘as 

appropriate.’’ The commenter stated that 

this language serves to ‘‘keep EPA 

within bounds’’ and explained that EPA 

may revise an earlier action only ‘‘as 

appropriate’’ to correct its error in 

undertaking the earlier action, and not 

to effect a change in policy. The 

commenter added the following reasons 

(which are discussed further in other 

sections of this document) that EPA’s 

actions are not appropriate: (i) It is not 

‘‘appropriate’’ to single out Texas’s SIP 

submission for disapproval based on a 

purported deficiency that is present in 

other states’ SIPs. (ii) It is not 

‘‘appropriate’’ to exercise section 

110(k)(6)’s error correction provisions 

where EPA is simultaneously exercising 

its powers under section 110(k)(5), 

which affords states procedural 

protections EPA has refused to afford 

under section 110(k)(6). 

Response: The term ‘‘as appropriate’’ 

should be viewed as highlighting the 

significant discretion that EPA has 

under the error correction provision to 

‘‘revise’’ the action it found to be in 

error, as discussed earlier in this 

preamble. EPA responds elsewhere in 

this rulemaking preamble to the specific 

reasons the commenter gives as to why 

the commenter believes EPA’s action 

was not appropriate.77 It should be 

noted here that the various 

considerations the commenter cites 

would suggest the commenter’s 

agreement that the term ‘‘appropriate’’ 

allows EPA to consider a wide range of 

factors, that is, to exercise broad 

discretion. 

Comment: One commenter questioned 

whether EPA had made a mistake 

because the action taken to approve the 

SIP was what EPA intended to do and 

was not done unintentionally. 

Response: EPA acted purposefully in 

fully approving the Texas SIP, but that 

does not mean that the full approval did 

not carry any element of an inadvertent 

error. As noted elsewhere in this 

rulemaking preamble, EPA and Texas 

both failed to look down the road and 

recognize that in all likelihood, EPA 

would newly subject additional 

pollutants to regulation, and thereby 

trigger the application of PSD to those 

additional pollutants, so that Texas’s 

SIP needed to—but did not—address 

that situation. 

c. Alternative Basis for Error Correction 

As explained previously, we view 

Texas’s recent statements that the CAA 

does not apply to non-NAAQS 

pollutants and that Texas has neither 

the authority nor the intention to apply 

PSD to GHGs as an indication that at the 

time Texas submitted its PSD program, 

Texas did not address the applicability 

of its program to pollutants newly 

subject to regulation or provide 

assurances that it had legal authority to 

apply its program to such pollutants. 

Absent specific evidence to the 

contrary, we are not inclined to 

conclude that at the time EPA approved 

the Texas PSD program in 1992, Texas 

in fact had filled those gaps—by, for 

example, providing assurances that it 

would apply PSD to each newly 

regulated non-NAAQS pollutants and 

had the legal authority to do so—but 

that more recently, Texas has failed to 

comply with those assurances. The CAA 

is based on a partnership between the 

states and the Federal government, and 

we think it more consonant with the 

principles of that partnership to 

interpret the evidence as indicating that 

Texas never addressed the gap or 

provided the requisite assurances. 

However, in the alternative, if one 

were to conclude that during the course 

of Texas’s submittal of, and EPA’s 

action on, the State’s PSD program, 

Texas did in fact, address the 

applicability of its program to newly 

regulated pollutants and did in fact 

provide the requisite assurances, so that 

no gaps in Texas’s PSD program existed 

at that time, then Texas’s recent 

statements would amount to failing to 

comply with, or even rescinding, those 

assurances. Under these circumstances, 

EPA would still consider its previous 

approval of Texas’s PSD SIP to have 

been in error. This is because if Texas 

should be considered to have addressed 

the issue and to have provided the 

appropriate assurances, then EPA 

should be considered to have based its 

approval on those assurances. For 

example, EPA stated in approving the 

Texas PSD program that EPA was 

relying on the 1989 Texas PSD 

Commitments Letter. Rescinding or 

failing to comply with those 

assurances—if that is what Texas is 

considered to have done—would 

eliminate the basis for EPA’s approval. 

Compare CAA section 110(k)(4) 

(authorizing EPA to approve a SIP 

revision based on a commitment by the 

state to adopt certain measures by a date 

certain, but if the state does not do so, 

then the conditional approval is treated 

as a disapproval). 

C. Error Correction: Conversion of 

Previous Approval to Partial Approval 

and Partial Disapproval 

Under CAA section 110(k)(6), once 

EPA determines that its previous action 

approving a SIP revision was in error, 

EPA ‘‘may ... revise such action as 

appropriate without requiring any 

further submission from the State. 

***’’ Under this provision, EPA may 

revise its previous full approval of 

Texas’s PSD program as appropriate, 

without requiring any submission from 

Texas. 

This provision offers EPA a great deal 

of discretion in revising its previous 

action. For one thing, the use of the term 

‘‘may’’ means that this provision simply 

authorizes, and does not require, EPA to 

revise its previous action even after EPA 

has determined the error, and that, in 

turn, implies that EPA has discretion in 

determining how to revise its previous 

action. Moreover, if EPA does decide to 

revise its previous action, EPA may do 

so in any way that is ‘‘appropriate.’’ The 

term ‘‘appropriate’’ offers EPA 

significant latitude in deciding what 

type of revision to do. 

Here, EPA is revising its previous full 

approval of Texas’s PSD program to be 

a partial approval and partial 

disapproval. Specifically, EPA is 

retaining the approval of Texas’s PSD 

program to the extent of the pollutants 

that the PSD program already does 

cover. This amounts to a partial 

approval. In addition, EPA is 

disapproving the Texas PSD program to 

the extent it has not addressed the 

applicability of its PSD program to each 

pollutant newly subject to regulation, 

including non-NAAQS pollutants, and 

because it has not provided assurances 

of adequate legal authority to apply its 

PSD program to such sources. 

D. Reconsideration Under CAA Section 

301, Other CAA Provisions, and Case 

Law 

As an alternative to the error 

correction provision of CAA section 

110(k)(6), EPA is using its inherent 

administrative authority to reconsider 

its prior approval actions as a basis for 

revising its previous full approval of the 

Texas PSD program to a partial approval 

and partial disapproval. This authority 


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lies in CAA section 301(a), read in 

conjunction with CAA section 110 and 

case law holding that an agency has 

inherent authority to reconsider its prior 

actions. 

As noted earlier, EPA approved the 

Texas PSD program by notice dated June 

24, 1992, 57 FR 28,093, under the 

authority of CAA section 110(k)(3)–(4). 

These provisions authorize EPA to 

approve a SIP submittal ‘‘as a whole,’’ 

‘‘approve [the SIP submittal] in part and 

disapprove [it] in part,’’ or issue a 

‘‘conditional approval’’ of a SIP 

submittal. EPA issued a full approval 

under CAA section 110(k)(3). 

In its approval action under that 

provision, EPA retained inherent 

authority to revise that action. The 

courts have found that an administrative 

agency has the inherent authority to 

reconsider its decisions, unless 

Congress specifically proscribes the 

agency’s discretion to do so. See, e.g., 

Gun South, Inc. v. Brady, 877 F.2d 858, 

862 (11th Cir. 1989) (holding that 

agencies have implied authority to 

reconsider and rectify errors even 

though the applicable statute and 

regulations do not provide expressly for 

such reconsideration); Trujillo v. 

General Electric Co., 621 F.2d 1084, 

1086 (10th Cir. 1980) (‘‘Administrative 

agencies have an inherent authority to 

reconsider their own decisions, since 

the power to decide in the first instance 

carries with it the power to reconsider’’). 

Section 301(a) of the CAA, read in 

conjunction with CAA section 110(k)(3) 

and the case law just described, 

provides statutory authority for EPA’s 

reconsideration action in this 

rulemaking. Section 301(a) authorizes 

EPA ‘‘to prescribe such regulations as 

are necessary to carry out [EPA’s] 

functions’’ under the CAA. 

Reconsidering prior rulemakings, when 

necessary, is part of ‘‘[EPA’s] functions’’ 

under the CAA—in light of EPA’s 

inherent authority as recognized under 

the case law to do so—and as a result, 

CAA section 301(a) confers authority 

upon EPA to undertake this rulemaking. 

EPA finds further support for its 

authority to narrow its approval in APA 

section 553(e), which requires EPA to 

give interested persons ‘‘the right to 

petition for the issuance, amendment, or 

repeal of a rule;’’ and CAA section 

307(b)(1), which expressly contemplates 

that persons may file a petition for 

reconsideration under certain 

circumstances (at the same time that a 

rule is under judicial review). These 

authorizations for other persons to 

petition EPA to amend or repeal a rule 

suggest that EPA has inherent authority, 

on its own, to issue such amendment or 

repeal. This is because EPA may grant 

a petition from another person for an 

amendment to or repeal of a rule only 

if justified under the CAA, and if such 

an amendment or repeal is justified 

under the CAA, then EPA should be 

considered as having inherent authority 

to initiate the process on its own, even 

without a petition from another person. 

EPA recently used its authority to 

reconsider prior actions and limit its 

prior approval of a SIP in connection 

with California conformity SIPs. See, 

e.g., 68 FR 15,720, 15723 (discussing 

prior action taken to limit approvals); 67 

FR 69,139 (taking final action to amend 

prior approvals to limit their duration); 

67 FR 46,618 (proposing to amend prior 

approvals to limit their duration, based 

on CAA sections 110(k) and 301(a)). 

EPA had previously approved SIPs with 

emissions budgets based on a mobile 

source model that was current at the 

time of EPA’s approval. Later, EPA 

updated the mobile source model. But, 

even though the model had been 

updated, emissions budgets would 

continue to be based on the older, 

previously approved model in the SIPs, 

rather than the updated model. To 

rectify this problem, EPA conducted a 

rulemaking that revised the previous 

SIP approvals so that the approvals of 

the emissions budgets would expire 

early, when the new ones were 

submitted by states and found adequate, 

rather than when a SIP revision was 

approved. This helped California more 

quickly adjust its regulations to 

incorporate the newer model. In this 

rule, EPA is using its authority to 

reconsider and limit its prior approval 

of SIPs generally in the same manner as 

it did in connection with California 

conformity SIPs. 

EPA is relying, in the alternative, on 

this inherent authority to convert its 

previous approval of Texas’s PSD 

program to a partial approval and partial 

disapproval for the same reasons 

discussed previously in connection with 

the ‘‘error’’ correction provision of CAA 

section 110(k)(6). That is, EPA approved 

Texas’s PSD program even though that 

program had significant flaws because 

Texas did not address the applicability 

of its PSD program to all pollutants 

newly subject to regulation, including 

non-NAAQS, and that Texas had 

adequate legal authority to do so. 

EPA’s inherent authority to reconsider 

its previous action also supports 

revising its previous action in the same 

manner, and for the same reasons, as 

under CAA section 110(k)(6), as 

described earlier. That is, in light of the 

flaws in the Texas PSD program, EPA is 

revising EPA’s previous full approval to 

be a partial approval (to the extent of the 

pollutants regulated under the CAA that 

are subject to Texas’s PSD program) and 

a partial disapproval (to the extent 

Texas’s program does not address 

pollutants newly subject to regulation, 

including non-NAAQS pollutants). 

1. Comments Received on 

Reconsideration Under Section 301(a) 

Several commenters questioned EPA’s 

ability to use section 301(a) given that 

EPA already has the authority to take 

this action through the SIP revision 

process. There is no gap for the Agency 

to fill with its general rulemaking 

authority, so, according to these 

commenters, EPA cannot use this 

section of the CAA to authorize this SIP 

revision without going through the 

notice and comment process required 

for a SIP revision. One commenter goes 

on to question whether the enactment of 

section 110(k)(6) would have been 

necessary if EPA had authority under 

section 301(a). 

2. Response to Comments 

EPA’s inherent authority to reconsider 

its actions in conjunction with CAA 

section 301(a) is not limited by the 

availability of the SIP revision process. 

That process entails the state submitting 

a revised SIP submission and EPA 

acting on it, which is fundamentally 

different than EPA reconsidering its 

action on the initial SIP submission 

without the state needing to submit a 

SIP revision. In addition, the 

reconsideration authority is broader 

than the section 110(k)(6) authority 

because the former is not necessarily 

limited to the correction of errors. And 

if, as commenters argue, the section 

110(k)(6) authority is limited to only 

technical or typographical errors, then 

the reconsideration authority is 

substantially broader. For these reasons, 

the reconsideration authority should not 

be considered to have been pre-empted 

or otherwise eliminated by the 

availability of either the SIP revision 

process or the error correction process. 

As for reasons why Congress would 

have added section 110(k)(6) if the 

reconsideration authority already 

existed, several reasons present 

themselves. Congress may have 

intended to codify into the CAA the 

reconsideration authority, which 

otherwise would have remained in the 

case law. In doing so, Congress 

established the criteria and process for 

error corrections. In addition, three 

years prior to the enactment of the 1990 

CAA Amendments, the U.S. Court of 

Appeals for the Third Circuit (3rd 

Circuit) handed down a decision in 

Concerned Citizens of Bridesburg v. U.S. 

EPA, 836 F.2d 777 (1987), which 

imposed severe limits on EPA’s 


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78Action to Ensure Authority to Issue Permits 

Under the Prevention of Significant Deterioration 

Program to Sources of Greenhouse Gas Emissions: 

Finding of Substantial Inadequacy and SIP Call 75 

FR 77,698 (December 13, 2010). 

79Texas’s 60-day letter, p. 1. 

80Texas 30-day letter, at 5, 6; Texas ‘‘Motion to 

Stay Three GHG Actions’’ 40–41, Coalition for 

Responsible Regulation v. EPA, No. 09–1322 (and 

consolidated cases). 

81See Texas ‘‘Motion to Stay Three GHG Actions’’ 

41, Coalition for Responsible Regulation v. EPA, No. 

09–1322 (and consolidated cases). 

authority to reconsider its actions. As 

discussed elsewhere in this preamble, 

although the legislative history is not 

explicit, section 110(k)(6) suggests by its 

terms that Congress intended the 

provision to in effect overturn that 

decision. 

E. Relationship of This Action to GHG 

PSD SIP Call 

As noted previously, EPA has recently 

taken another action concerning Texas’s 

PSD program as that program relates to 

GHGs: the GHG PSD SIP call, which we 

published by notice dated December 13, 

2010, 75 FR 77,698. This section 

describes the relationship of this errorcorrection/partial-disapproval/FIP 

action to the SIP call. For convenience, 

the background for the SIP call, 

although described in detail earlier in 

this preamble, is reiterated here. 

EPA promulgated the SIP call under 

CAA section 110(k)(5), which provides: 

Whenever the Administrator finds that the 

applicable implementation plan for any area 

is substantially inadequate to * * * comply 

with any requirement of [the CAA], the 

Administrator shall require the State to revise 

the plan as necessary to correct such 

inadequacies. The Administrator * * * may 

establish reasonable deadlines (not to exceed 

18 months) after [notifying the state of the 

inadequacies] for the submission of such 

plan revisions. 

In the SIP call, EPA made a finding that 

the PSD SIPs of each of 13 states, 

including Texas, do not apply to GHGemitting sources and therefore are 

‘‘substantially inadequate to * * * 

comply with [the PSD applicability] 

requirement[s]’’ of the CAA. 

Accordingly, EPA required each state, 

including Texas, to submit a corrective 

SIP revision. EPA established a deadline 

for the SIP submittal for each state as 12 

months from the date of the SIP call, or 

December 1, 2011, unless the state 

indicated in its 30-day letter that it did 

not object to an earlier deadline. Each 

state for which EPA would finalize the 

SIP call submitted a 30-day letter, and 

each, except for Texas, indicated a date 

sooner than December 1, 2011. Texas 

did not indicate any particular date and, 

as a result, EPA established December 1, 

2011 as Texas’s deadline. In addition, 

EPA stated that if Texas or any of the 

other states failed to submit its 

corrective SIP revision by its deadline, 

EPA intended to promulgate a FIP 

immediately thereafter. 

The timing of the SIP call—both the 

time that EPA promulgated the SIP call 

and the deadlines it established for SIP 

submittals—was driven by the fact that 

the affected states did not have 

authority to issue PSD permits to GHGemitting sources and as a result, those 

sources could face delays in 

construction and modification when 

they became subject to PSD as early as 

January 2, 2011. EPA designed the SIP 

call to maximize the opportunity of each 

affected state to assure that its sources 

would have a permitting authority 

available as of that date or a later date, 

if the state concluded that a later date 

would not leave its sources facing 

delays. EPA did so by allowing each 

state flexibility for its SIP submittal 

deadline. 

Each of the affected states except 

Texas responded with a plan that would 

assure that its sources would not 

confront permitting delays. Most 

states—7 of the 13 states—indicated 

they would not object to EPA’s 

establishing a SIP submittal date of 

December 22, 2010, recognizing that as 

a practical matter, that meant that EPA 

would promulgate a FIP on December 

23, 2010. An eighth state (Kentucky) 

took the same approach for one of its 

counties (Jefferson County), except that 

it selected the slightly later date of 

January 1, 2011.78 Five states (including 

Kentucky for the rest of its state) 

indicated a later date, and again, one 

indicated a date as late as July 1, 2011. 

This means that purely as a legal matter, 

there would be no permitting authority 

in place in those five states to issue 

GHG permits on January 2, 2011, when 

GHG-emitting sources became subject to 

PSD. Even so, the later dates were 

acceptable to each of the five states 

because (i) they intended to submit a 

SIP revision by their date, and (ii) they 

did not expect the lack of a permitting 

authority during the period before their 

deadline to place their sources at risk 

for delays in construction or expansion. 

Texas responded differently than the 

other states. In its 30-day letter, Texas 

did not indicate a particular date for its 

SIP submittal, and as a result, EPA, as 

we had proposed, established Texas’s 

deadline at December 1, 2011. But 

shortly before submitting its 30-day 

letter, Texas stated, in its 60-day letter, 

that ‘‘Texas has neither the authority nor 

the intention of interpreting, ignoring, 

or amending its laws in order to compel 

the permitting of greenhouse gas 

emission.’’ 79 Texas has never qualified 

this statement, and as a result, EPA 

reads this statement to indicate that 

Texas does not intend to submit a SIP 

revision as required under the SIP call. 

This means that a permitting 

authority for GHG-emitting sources 

would not be in place until EPA 

promulgated a FIP, no earlier than 

December 2, 2011. Importantly, Texas 

has indicated that this one-year delay in 

the availability of a permitting authority 

would, in fact, mean that under EPA’s 

interpretation of the CAA, Texas’s 

sources would face delays in 

constructing and modifying.80

Moreover, Texas indicated that during 

2011, some 167 construction or 

modification projects would be 

affected,81 which are significantly more 

sources than any other state. 

Moreover, Texas’s indication that it 

does not intend to submit a SIP revision, 

and that it does not consider its PSD 

program as being required to apply to 

non-NAAQS pollutants, including 

GHGs, has cast a spotlight on 

underlying flaws in Texas’s fully 

approved PSD SIP, and that, in turn, has 

brought into play the error-correction 

provision in CAA section 110(k)(6). All 

this is discussed in detail earlier in this 

preamble, but to reiterate for 

convenience: CAA section 110(k)(6) 

provides, ‘‘Whenever the Administrator 

determines that the Administrator’s 

action approving * * * any [SIP] * * * 

was in error, the Administrator may 

* * * revise such action as 

appropriate.* * *’’ Here, the Texas SIP 

was flawed at the time EPA approved it 

because it did not address, or assure 

adequate legal authority for, application 

of the PSD program to pollutants newly 

subject to regulation, including nonNAAQS pollutants. As a result, EPA has 

the authority to determine that its full 

approval of the SIP was ‘‘in error’’ and 

to convert that action to a partial 

approval and partial disapproval; and as 

a result of that, EPA is authorized to 

promulgate a FIP immediately. 

This is an important reason why EPA 

is proceeding with this error-correction/ 

partial approval and partial disapproval 

rulemaking at this time. This approach 

allowed EPA to implement a FIP 

immediately as an interim rule, instead 

of waiting until December, 2011, and as 

a result, EPA has been able to act as the 

permitting authority in Texas and in 

that capacity, allow Texas sources to 

avoid delays in construction or 

modification. This same approach 

allows EPA to continue to keep the FIP 

in place and continues to act as the 

permitting authority so that there are no 

gaps in coverage for sources to obtain 

permits. 


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82 In contrast, situations could also arise in which 

EPA has a basis for imposing a SIP call but not 

issuing an error correction because the SIP 

currently has a substantial inadequacy but was not 

flawed at the time of its submittal and approval. 

83 In this case, the substantial inadequacy for 

which EPA issued the SIP call, which was the PSD 

program’s failure to apply to GHGs, is narrower 

than the flaw in the SIP for which EPA is issuing 

the error correction, which is the PSD program’s 

failure to address, or assure legal authority for, 

application of PSD to all pollutants newly subject 

to regulation. In another case, it is conceivable that 

the opposite would be true, that the substantial 

inadequacy would be broader than the flaw in the 

SIP for which EPA issues the error correction. In 

that case, if EPA imposed a FIP after the deadline 

for SIP submittal related to the SIP call, the FIP 

would be broader than the FIP imposed after the 

disapproval related to the error correction. 

84We recognize that Texas has indicated that it 

does not intend to submit a SIP revision, but this 

does not eliminate the utility of establishing a SIP 

submittal schedule. 

With the interim final rule and the 

present rulemaking, EPA has both (i) 

promulgated a SIP call and established 

a SIP deadline of December 1, 2011 for 

Texas, under CAA section 110(k)(5); and 

(ii) corrected its error in previous fully 

approving Texas’s PSD program by 

converting that action to a partial 

approval and partial disapproval, under 

CAA section 110(k)(6), and then 

promulgating a FIP immediately, under 

CAA section 110(c)(1)(B). For the 

reasons just discussed, each of these 

actions is fully justified under the 

applicable CAA provisions. 

Moreover, there is no preclusion 

against taking both of these actions with 

respect to Texas at this time, for the 

following reasons: First, the two actions 

are based on CAA provisions—CAA 

section 110(k)(5) (SIP call), and section 

110(k)(6) (error correction)—that 

overlap, so that it is to be expected that 

circumstances may arise in which both 

apply. If EPA approves a flawed SIP, 

then circumstances could well arise 

under which EPA has a basis for 

concluding both that (i) the SIP is 

‘‘substantially inadequate’’ to meet a 

CAA requirement, under CAA section 

110(k)(5); and (ii) EPA’s action in 

approving the SIP was ‘‘in error,’’ under 

CAA section 110(k)(6). The same flaw in 

the SIP would be the basis for each of 

those actions.82

This is the case with EPA’s two 

actions concerning Texas. As EPA stated 

in the SIP call, the basis for the finding 

of ‘‘substantial inadequacy’’ was the 

failure of Texas’s approved SIP PSD 

program to apply to GHGs, which was 

rooted in the program’s failure to apply 

pollutants newly subject to regulation. 

As EPA stated earlier in this preamble, 

the basis for the determination that 

EPA’s previous full approval of Texas’s 

SIP was ‘‘in error’’ was the gap in the SIP 

due to the SIP’s failure to address, or 

assure that it has adequate legal 

authority for, the application to 

pollutants newly subject to regulation.83

Second, each provision, by its terms, 

is discretionary to EPA, and neither 

provision precludes the application of 

the other. CAA section 110(k)(5) applies 

‘‘[w]henever the Administrator finds’’ 

that the SIP is substantially inadequate. 

CAA section 110(k)(6) applies 

‘‘[w]henever the Administrator 

determines’’ that her previous action 

was in error. Neither provision 

references the other. Neither provision 

includes any requirement or limitation 

that constrains the application of the 

other at any time. 

Third, each provision serves a 

different purpose and when applied to 

this case—including in conjunction 

with the FIP provision in CAA section 

110(c)(1)—leads to a different outcome, 

but each outcome is neither dependent 

on, or compromised by, the other 

outcome. CAA section 110(k)(5), as 

applied in the current case, is focused 

on a present problem with the SIP, that 

is, a ‘‘substantial[] inadequacy’’ that 

currently exists. This provision 

mandates that EPA require a corrective 

SIP revision to address that inadequacy, 

but further provides that EPA must 

allow a reasonable deadline for the state 

to submit the SIP revision. In the GHG 

PSD SIP call, EPA allowed states to, in 

effect, choose within a range of 

deadlines. But if the state fails to submit 

the required SIP revision by its 

deadline, then EPA is required to 

promulgate a FIP under CAA section 

110(c)(1)(A). CAA section 110(k)(6), as it 

applies in the current case, is focused 

on a past problem with SIP, that is, a 

flaw that existed at the time EPA 

approved the SIP, so that EPA’s 

approval was ‘‘in error.’’ This provision 

authorizes EPA to convert the approval 

to a disapproval, but does not mandate 

that the state submit a new SIP revision. 

This is because the state has already 

submitted a SIP revision, the one that is 

flawed, and EPA has acted on it. 

Instead, EPA is required to promulgate 

a FIP under CAA section 110(c)(1)(B), 

and EPA may do so immediately. The 

FIP will remain in place until the state 

submits, and EPA approves, a SIP 

revision. 

Viewing the two provisions as applied 

here together: (i) CAA section 110(k)(5) 

allows EPA to exercise its discretion to 

make a finding that Texas’s SIP is 

‘‘substantially inadequate,’’ and then to 

establish a SIP submittal schedule for 

Texas, one that is consistent with 

whatever choice as to deadline Texas 

had available to it; and (ii) CAA section 

110(k)(6) allows EPA to exercise its 

discretion to convert its previous 

approval of Texas’s SIP, which EPA 

made ‘‘in error,’’ to a disapproval, and 

then to promulgate a FIP immediately. 

The requirement that Texas submit a 

corrective SIP revision and do so by a 

date certain—a date that Texas 

exercised some control over—serves the 

useful function of establishing a 

mechanism and a timeframe for Texas to 

address the substantial inadequacy in its 

PSD SIP.84 The immediate promulgation 

of a FIP serves the useful purpose of 

assuring the availability of a permitting 

authority as of January 2, 2011, so that 

Texas sources will not face delays in 

their plans to construct or modify. 

Importantly, the immediate 

promulgation of a FIP through this 

rulemaking does not compromise in any 

manner the SIP submittal deadline 

established for Texas through the SIP 

call. After EPA’s promulgation of the 

FIP, Texas remains obligated to submit 

the corrective SIP revision by December 

1, 2011. As soon as Texas does submit 

that SIP revision and EPA approves it, 

EPA will rescind the part of the FIP that 

concerns GHGs. It is always the case 

that when EPA has promulgated a FIP 

of any type in a particular state, the state 

remains obligated to adopt a SIP 

revision. Nothing about a FIP impedes 

the state from doing so; and when the 

state does so and EPA approves the SIP 

revision, then EPA rescinds the FIP. 

It is true that one of the purposes of 

the SIP call, as applied here, was to 

allow states to in effect select an early 

FIP—by selecting an early SIP submittal 

date and then not submitting a SIP by 

that date—so as to assure the 

availability of a permitting authority for 

their sources by that early date. And it 

is further true that Texas, in its 30-day 

letter, chose not to select such an early 

date and, on the contrary, stated its 

opposition to a FIP; yet, in this present 

rulemaking, EPA is promulgating an 

immediate FIP for Texas. But this does 

not mean that the present rulemaking 

has compromised the SIP call or any 

choices made available to Texas in the 

SIP call. The focus of the SIP call, as it 

related to Texas, was the finding of a 

substantial inadequacy in Texas’s PSD 

program, the imposition of a 

requirement for Texas to submit a 

corrective SIP revision, and—based on 

Texas’s choice—the establishment of a 

deadline of December 1, 2011 for Texas 

to do so. The promulgation of an 

immediate FIP through the present 

rulemaking does not disturb that. Texas 

remains subject to the December 1, 

2011, SIP submittal schedule that EPA 

established for it, based on Texas’s 

decision not to respond directly to 


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85 In any event, to conclude that the promulgation 

of a FIP under this error-correction rulemaking 

compromised the SIP call rulemaking would be 

tantamount to concluding that the SIP call should 

somehow take priority over this error correction. 

There would be no basis for taking that position. 

Each action is fully justifiable in its own right. The 

process of completing one before the other does not 

give the first one a priority simply because it is first 

any more than that process would give the second 

a priority because the latter is more recent. 

86Texas 60-day letter, p. 1. 

87Texas 30-day letter. 

EPA’s request that Texas itself identify 

a deadline.85 Texas’s expressed 

opposition to a FIP does not preclude 

EPA from imposing one as justified 

through the present rulemaking. 

It is also true that, as EPA stated in 

the SIP call, ‘‘federalism principles 

* * * underlie the SIP call process and 

the SIP system as a whole,’’ and that 

means that ‘‘in the first instance, it is to 

the state to whom falls the 

responsibility of developing pollution 

controls through an implementation 

plan.’’ 75 FR 77,710/2. And it is further 

true that the immediate promulgation of 

a FIP through the present errorcorrection action means that a FIP will 

be in place in Texas before the 

December 1, 2011 deadline established 

under the SIP call for Texas to adopt its 

SIP. However, imposition of the FIP is 

fully justified under this errorcorrection action, as discussed 

previously, and is essential to assure 

that Texas sources will not face delays 

in construction or modification, a risk 

that Texas acknowledges will occur 

under EPA’s interpretation of the 

applicable CAA requirements. In any 

event, Texas’s statement that ‘‘Texas has 

neither the authority nor the intention 

of interpreting, ignoring, or amending 

its laws in order to compel the 

permitting of greenhouse gas 

emission,’’ 86 as we read it, is 

tantamount to a direct statement that it 

does not intend to submit a GHG PSD 

SIP revision, and is a direct statement 

that it does not intend to require its 

sources to obtain permits for their GHG 

emissions. Accordingly, it is difficult to 

see how it could meaningfully be 

claimed that an early FIP, promulgated 

through this rulemaking, could displace 

any prerogatives Texas may have under 

the SIP call to develop its own SIP 

revision before the imposition of a FIP 

or to exercise control over the 

permitting of GHG emissions of its 

sources. Similarly, Texas has stated that 

it does not believe that EPA’s FIP will 

be effective because, according to Texas, 

EPA will be unable to issue permits for 

a lengthy period due to uncertainty over 

how to apply PSD requirements to GHGemitting sources.87 Accordingly, it is 

difficult to see how it could 

meaningfully be claimed that a FIP, 

which Texas considers ineffective, 

could adversely affect Texas’s interests. 

It is also true that under the principles 

of federalism that underlie the SIP 

system, states exercise some discretion 

over controls for their industry, so that 

a state may impose more stringent 

controls than minimum CAA 

requirements. CAA section 116. But this 

discretion does not mean that Texas is 

authorized to create the circumstances 

under which its sources face delays in 

constructing or modifying and EPA is 

precluded from promulgating a FIP— 

when justified under this rulemaking— 

for the purpose of protecting those 

sources against such delays. Absent this 

action, Texas sources would face delays 

in construction and modification 

resulting from Texas’s decision during 

the course of the SIP call to neither 

adopt a SIP promptly nor facilitate an 

early FIP. Those delays do not result 

from Texas’s decision to impose more 

stringent controls than the CAA 

requires. On the contrary, Texas’s action 

is inconsistent with one of the purposes 

of the PSD provisions, which is ‘‘to 

insure that economic growth will occur 

in a manner consistent with the 

preservation of clean air resources.’’ 

CAA section 160(3). EPA is justified in 

interpreting and applying CAA section 

110(k)(6) to correct errors related to 

Texas’s SIP PSD program in order to 

effectuate this purpose of PSD. The DC 

Circuit has held that the terms of the 

PSD provisions should be interpreted 

with the PSD purposes in mind, New 

York v. EPA, 413 F.3d 3, 23 (DC Cir.), 

rehearing en banc den., 431 F.3d 801 

(2005), and the same should be true of 

CAA section 110(k)(5) as applied to PSD 

requirements. 

F. Relationship of This Rulemaking to 

Other States 

EPA is not, at this time, undertaking 

a similar error-correction rulemaking for 

any of the other states that are subject 

to the SIP call. EPA has discretion as to 

whether and when to undertake such a 

rulemaking, and each of the other states 

has chosen a course of action that at 

present appears to assure that its large 

GHG-emitting sources will have a 

permitting authority available when the 

sources need one, and therefore will not 

face delays in constructing or 

modifying. As a result, EPA has not 

inquired into whether any of these other 

states have flaws in their SIP PSD 

programs as Texas does. 

1. Comments on the Relationship of 

This Rulemaking to Other States 

Industry commenters, in addition to 

the State of Texas, raised concerns about 

this rule treating Texas differently than 

other states. Other states, such as 

Arizona, Arkansas, Connecticut, 

Florida, Idaho, and Kansas, do not have 

SIPs that automatically update to 

incorporate new requirements, and so 

regulate new pollutants in a ‘‘stepwise’’ 

fashion, according to these commenters. 

Moreover, these commenters argue that 

EPA’s approval of Texas’s SIP cannot be 

considered to have been in error 

because, they say, EPA approved other 

SIPs that, like Texas’s, did not 

automatically apply PSD to each 

pollutant newly subject to regulation. 

Several industry commenters also 

stated that they believe that EPA’s 

rationale for this rule, read in 

conjunction with EPA’s PSD Narrowing 

Rule 75 FR 8253682,536 (December 30, 

2010) makes it impossible for a state to 

ever have an approvable SIP. This is 

because, according to these commenters, 

states can only have an approvable SIP 

if they automatically incorporate 

Federal requirements when EPA adopts 

them. However, the PSD Narrowing 

Rule was required because those states 

that do ‘‘impose PSD applicability on 

new pollutants in an unconstrained 

manner’’ in their SIPs do not ensure that 

states have adequate funding and 

personnel to implement the new SIP 

requirements, according to commenters. 

2. Response to Comments 

EPA disagrees with the comments that 

we are singling out Texas for unfair 

treatment for its failure to automatically 

update its SIP to incorporate new 

requirements. Texas is, in fact, unlike 

each of these other states. Texas, 

uniquely among all the states, has stated 

that it will not implement PSD 

requirements for GHGs either by 

revising or committing to revise its SIP. 

It is this refusal that has shined a 

spotlight on EPA’s error in previously 

approving Texas’s SIP, for the reasons 

discussed earlier in this preamble. 

Moreover, each of the other states 

identified by commenters has taken 

measures to ensure that permitting for 

GHG-sources in its state will be 

available. Arizona, Arkansas, Florida, 

and Idaho each have a FIP in place to 

allow EPA to issue permits to GHGemitting sources. Connecticut has 

submitted a SIP revision to enable the 

state to assume responsibility for PSD 

permitting of these sources. Kansas 

already has an approved SIP that 

applies PSD to GHGs. Accordingly, it 

has never been necessary for EPA to 

inquire, and EPA has not inquired, into 

whether these states have flaws in their 

PSD SIPs. In addition, the error 

correction provision is discretionary: it 

provides that EPA ‘‘may’’ undertake an 


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error correction when it finds that its 

previous action was in error. 

Accordingly, even if EPA did inquire 

into the SIP PSD program approvals in 

these other states, EPA would not be 

required to issue an error correction for 

them. In light of the fact that these states 

are addressing their GHG-emitting 

sources as described previously, EPA 

sees no need at present to consider an 

error-correction action with respect to 

those states. Finally, EPA disagrees with 

the commenters’ argument that EPA’s 

approval of these several other PSD 

SIPs—despite their lack of an automatic 

updating mechanism—means that EPA’s 

approval of Texas’s PSD SIP was not in 

error. As discussed elsewhere in this 

rulemaking preamble, the Texas SIP was 

flawed because it did not address the 

applicability of PSD to pollutants newly 

subject to regulation, not because it did 

not automatically apply PSD to such 

pollutants. Commenters have not shown 

that the several other SIPs they discuss 

did not address the applicability of PSD 

to pollutants newly subject to PSD in 

some way other than automatic 

updating. And if any other of the SIPs, 

or even all of them, did not do so, then 

it is possible that those SIPs were 

flawed in the same manner as Texas’s, 

and that in approving them, EPA 

repeated the same error that it made in 

approving Texas’s SIP. But to reiterate, 

section 110(k)(6) is discretionary with 

EPA and EPA has no reason to review 

those SIPs. 

EPA also disagrees with the 

commenters that contend that no SIP 

could possibly be approvable given the 

rationales presented for this rule and the 

SIP Narrowing Rule. In this action, EPA 

identifies as the flaw in the SIPs the 

failure to address the applicability of 

PSD to newly regulated pollutants 

(along with the failure to provide 

adequate assurances of legal authority to 

apply PSD to such pollutants). As noted 

earlier in this preamble, there are 

several ways that states could address 

this flaw, and although providing for 

automatic updating is one way—and the 

one that most states have adopted—it is 

not the only way. A state could, for 

example, commit to adopt a SIP revision 

to apply PSD to a newly regulated 

pollutant. In the course of addressing 

the applicability of PSD to a newly 

regulated pollutant, the state could 

address any associated resource issues. 

Moreover, as EPA explained in the SIP 

Narrowing rule, the flaw that needed 

correcting by that rule was the 

‘‘combination of that unconstrained 

applicability and the failure of the SIP 

to plan for adequate resources for that 

applicability, and to do so on the 

appropriate time-table.’’ (emphasis 

added) 75 FR 82,542 (December 30, 

2010). There are, in fact, some states 

that were able to revise their SIPs before 

January 2, 2011. Six other states and 

four districts within states were able to 

interpret their SIPs to regulate GHG 

emissions only above the Tailoring Rule 

thresholds, and needed no further 

action by EPA. There is, then, no 

‘‘conundrum’’ for a state that does not 

adopt EPA regulations by reference. 

G. Federal Implementation Plan 

1. Authority To Promulgate a FIP 

In this rulemaking, EPA is 

promulgating a FIP to apply EPA’s PSD 

regulatory program to GHG-emitting 

sources in Texas and to commit to take 

action as appropriate with respect to 

pollutants that become newly subject to 

regulation. 

The CAA authority for EPA to 

promulgate a FIP is found in CAA 

section 110(c)(1), which provides— 

The Administrator shall promulgate a 

Federal implementation plan at any time 

within 2 years after the Administrator * * * 

(B) disapproves a State implementation plan 

submission in whole or in part, unless the 

State corrects the deficiency, and the 

Administrator approves the plan or plan 

revision, before the Administrator 

promulgates such [FIP]. 

As indicated earlier in this notice, 

EPA is partially disapproving Texas’s 

PSD program by correcting EPA’s 

previous full approval to be a partial 

approval and partial disapproval. 

Accordingly, under CAA section 

110(c)(1)(B), EPA is required to 

promulgate a PSD FIP for Texas. 

The FIP must be designed to address 

the flaws in Texas’s PSD program. As 

discussed earlier in this preamble, the 

Texas PSD program contains significant 

gaps: It does not address, or provide 

assurances of adequate legal authority 

for, application to pollutants newly 

subject to regulation, including nonNAAQS pollutants. As a practical 

matter, at present, the only pollutant the 

program does not address is GHGs. 

Accordingly, the FIP applies the EPA 

regulatory PSD program to GHGs. In 

addition, the FIP commits to address 

pollutants that become newly subject to 

regulation, as appropriate. 

2. Timing of FIP 

EPA is promulgating the FIP in this 

rulemaking, so that it takes effect 

immediately upon the partial 

disapproval. This timing for FIP 

promulgation is authorized under CAA 

section 110(c)(1), which authorizes us to 

promulgate a FIP ‘‘at any time within 2 

years after’’ EPA disapproves a SIP 

submission in whole or in part. The 

quoted phrase, by its terms, establishes 

a two-year period within which EPA 

must promulgate the FIP, and provides 

no further constraints on timing. 

Accordingly, this provision gives EPA 

discretion to promulgate the FIP at any 

point in time within that two-year 

period, and in this rulemaking, EPA is 

promulgating the FIP immediately. 

The reason why we are exercising our 

discretion to promulgate the FIP 

immediately is to minimize any period 

of time during which larger-emitting 

sources in Texas may be under an 

obligation to obtain PSD permits for 

their GHGs when they construct or 

modify, but no permitting authority is 

authorized to issue those permits. We 

believe that acting immediately is in the 

best interests of the regulated 

community. Note that for similar 

reasons, in EPA’s recently promulgated 

SIP call, EPA stated that if a state failed 

to submit its required SIP revision by its 

deadline, EPA would immediately make 

a finding of failure to submit and 

immediately thereafter promulgate a 

FIP. 75 FR 53,889/2. 

The lack of constraints in CAA 

section 110(c)(1)(B) stands in contrast to 

other CAA provisions that do impose 

requirements for the timing of 

proposals. See CAA sections 

109(a)(1)(A), 111(b)(1)(B). In light of the 

lack of constraints, EPA was free to 

promulgate the FIP concurrently with 

the disapproval action. 

3. Substance of GHG PSD FIP 

a. Components of FIP 

The FIP consists of two components. 

The first mirrors the GHG PSD FIP that 

EPA promulgated for seven states for 

which EPA issued the PSD GHG SIP call 

and, subsequently, issued a finding of 

failure to submit a required SIP 

submittal. Thus, this component of the 

FIP consists of the EPA regulations 

found in 40 CFR 52.21, including the 

PSD applicability provisions, with a 

limitation to assure that, strictly for 

purposes of this rulemaking, the FIP 

applies only to GHGs. Under the PSD 

applicability provisions in 40 CFR 

52.21(b)(50), the PSD program applies to 

sources that emit the requisite amounts 

of any ‘‘regulated NSR pollutant[s],’’ 

including any air pollutant ‘‘subject to 

regulation.’’ However, Texas’s partially 

approved SIP already applies PSD to 

other air pollutants. To appropriately 

limit the scope of the FIP, EPA amends 

40 CFR 52.21(b)(50), as incorporated 

into the Texas FIP, to limit the 

applicability provision to GHGs. 


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We adopt this FIP because, as we 

stated in the proposed GHG PSD FIP— 

it would, to the greatest extent possible, 

mirror EPA regulations (as well as those of 

most of the states). In addition, this FIP 

would readily incorporate the phase-in 

approach for PSD applicability to GHG 

sources that EPA has developed in the 

Tailoring Rule and expects to develop further 

through additional rulemaking. As explained 

in the Tailoring Rule, incorporating this 

phase-in approach—including Steps 1 and 2 

of the phase-in as promulgated in the 

Tailoring Rule—can be most readily 

accomplished through interpretation of the 

terms in the definition ‘‘regulated NSR 

pollutant,’’ including the term ‘‘subject to 

regulation.’’ 

In accordance with the Tailoring Rule, 

* * * the FIP would apply in Step 1 of the 

phase-in approach only to ‘‘anyway sources’’ 

(that is, sources undertaking construction or 

modification projects that are required to 

apply for PSD permits anyway due to their 

non-GHG emissions and that emit GHGs in 

the amount of at least 75,000 tpy on a CO2e 

basis) and would apply in Step 2 of the 

phase-in approach to both ‘‘anyway sources’’ 

and sources that meet the 100,000/75,000-tpy 

threshold (that is, (i) sources that newly 

construct and would not be subject to PSD 

on account of their non-GHG emissions, but 

that emit GHGs in the amount of at least 

100,000 tpy CO2e, and (ii) existing sources 

that emit GHGs in the amount of at least 

100,000 tpy CO2e, that undertake 

modifications that would not trigger PSD on 

the basis of their non-GHG emissions, but 

that increase GHGs by at least 75,000 tpy 

CO2e). 

Under the FIP, with respect to permits for 

‘‘anyway sources,’’ EPA will be responsible 

for acting on permit applications for only the 

GHG portion of the permit, and the state will 

retain responsibility for the rest of the permit. 

Likewise, with respect to permits for sources 

that meet the 100,000/75,000-tpy threshold, 

our preferred approach—for reasons of 

consistency—is that EPA will be responsible 

for acting on permit applications for only the 

GHG portion of the permit, that the state 

permitting authorities will be responsible for 

the non-GHG portion of the permit, and EPA 

will coordinate with the state permitting 

authority as needed in order to fully cover 

any non-GHG emissions that, for example, 

are subject to BACT because they exceed the 

significance levels. 

75 FR 53,889/3 to 53,890/1. 

This formulation of the FIP is 

authorized because it is part of the 

‘‘appropriate’’ action EPA is authorized 

to take as part of EPA’s correction of its 

previous, erroneous full approval, under 

CAA section 110(k)(6). 

The second component of the FIP 

consists of a commitment that EPA will 

take such action as is appropriate to 

ensure that pollutants that become 

newly subject to regulation are subject 

to the FIP. If a pollutant becomes newly 

subject to regulation in the future, and 

if Texas does not take steps to subject 

it to its PSD program, then EPA will 

take the appropriate action. 

b. Dual Permitting Authorities 

In the GHG PSD FIP proposal, 

commenters raised concerns about how 

having EPA issue the GHG portions of 

a permit while allowing states under a 

FIP to continue to be responsible for 

issuing the non-GHG portions of a PSD 

permit will work in practice. 

Commenters specifically identified the 

potential for a source to be faced with 

conflicting requirements and the need to 

mediate among permit engineers making 

BACT decisions. 

We well recognize that dividing 

permitting responsibilities between two 

authorities—EPA for GHGs and the 

state, Texas, in this case, for all other 

pollutants—will require coordination 

between the two authorities to avoid 

duplication, conflicting determinations, 

and delays. We note that this situation 

is not without precedent. In many 

instances, EPA has been the PSD 

permitting authority but the state has 

accepted a delegation for parts of the 

PSD program, so that a source has had 

to go to both the state and EPA for its 

permit. In addition, all nonattainment 

areas in the nation are in attainment or 

are unclassifiable for at least one 

pollutant, so that every nonattainment 

area is also a PSD area. In some of these 

areas, the state is the permitting 

authority for nonattainment NSR and 

EPA is the permitting authority for PSD. 

As a result, there are instances in which 

a new or modifying source in such an 

area has needed a nonattainment NSR 

permit from the state and a PSD permit 

from EPA. 

EPA is working expeditiously to 

develop recommended approaches for 

EPA regions and affected states to use in 

addressing the shared responsibility of 

issuing PSD permits for GHG-emitting 

sources. EPA delegated the authority to 

issue PSD permits to GHG-emitting 

sources to one state, and is working 

toward similar delegations in other 

states. In addition, EPA has provided 

training and guidance for permitting 

authorities in determining GHG BACT 

for these sources. 

In addition, we note that the concern 

over dual permitting authorities would 

become moot if Texas were either to 

submit and EPA approve a SIP revision 

that applies PSD to GHGs or request a 

delegation of permitting responsibility. 

If it did request and receive a 

delegation, it would be responsible for 

issuing both the GHG part and the nonGHG part of the permit, and that would 

moot concerns about split-permitting. 

4. Period for GHG PSD FIP To Remain 

in Place 

In the FIP proposal, we stated our 

intention to leave any promulgated FIP 

in place for as short a period as possible, 

and to process any corrective SIP 

revision submitted by the state to fulfill 

the requirements of the SIP call as 

expeditiously as possible. Specifically, 

we stated: 

After we have promulgated a FIP, it must 

remain in place until the state submits a SIP 

revision and we approve that SIP revision. 

CAA section 110(c)(1). Under the present 

circumstances, we will act on a SIP revision 

to apply the PSD program to GHG sources as 

quickly as possible. Upon request of the state, 

we will parallel-process the SIP submittal. 

That is, if the state submits to us the draft SIP 

submittal for which the state intends to hold 

a hearing, we will propose the draft SIP 

submittal for approval and open a comment 

period during the same time as the state 

hearing. If the SIP submittal that the state 

ultimately submits to us is substantially 

similar to the draft SIP submittal, we will 

proceed to take final action without a further 

proposal or comment period. If we approve 

such a SIP revision, we will at the same time 

rescind the FIP. 

75 FR 53,889/2–3. 

We continue to have these same 

intentions. Thus, we reaffirm our 

intention to leave the GHG PSD FIP in 

place only as long as is necessary for the 

state to submit and for EPA to approve 

a SIP revision that includes PSD 

permitting for GHG-emitting sources. As 

discussed in more detail later in this 

preamble, EPA continues to believe that 

the states, including Texas, should 

remain the primary permitting 

authority. 

Specifically, EPA will rescind the FIP, 

in full or in part, if (i) Texas submits, 

and EPA approves, a SIP revision to 

apply Texas’s PSD program to GHGemitting sources, (ii) Texas provides 

assurances that in the future, it will 

apply its PSD program to all pollutants 

newly subject to regulation, including 

non-NAAQS pollutants, and (iii) Texas 

provides ‘‘necessary assurances’’ under 

CAA section 110(a)(2)(E)(ii) that it ‘‘will 

have adequate * * * authority under 

State law’’ to apply its PSD program to 

such pollutants. 

In addition, if Texas does not submit 

a SIP revision by December 1, 2011, in 

response to the SIP Call, EPA intends to 

promulgate, on or about December 2, 

2011, the FIP associated with the SIP 

call. The GHG provisions of the FIP 

promulgated with this error correction 

rulemaking will be fully consistent with 

the provisions in the FIP associated 

with the SIP call. The remaining 

components of the FIP promulgated 

with this error correction rulemaking, 


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which concern other non-criteria 

pollutants other than GHGs, will also 

remain in place. 

5. Primacy of Texas’s SIP Process 

This action to partially approve and 

partially disapprove Texas’s SIP PSD 

program and to promulgate a FIP is 

secondary to our overarching goal, 

which is to assure that it will be Texas 

that will be the permitting authority. 

EPA continues to recognize that Texas 

is best suited to the task of permitting 

because the state and its sources have 

experience working together in the state 

PSD program to process permit 

applications. EPA seeks to remain solely 

in its primary role of providing 

guidance and acting as a resource for 

Texas as it makes the various required 

permitting decisions for GHG emissions. 

Accordingly, we are prepared to work 

closely with Texas to help it promptly 

develop and submit to us a SIP revision 

that extends its PSD program to GHGemitting sources and that assures that 

the program will apply to each pollutant 

newly subject to regulation in the 

future. If Texas submits such a SIP 

revision, we intend to promptly act on 

it, and if we approve it, then we intend 

to rescind the FIP immediately. Again, 

EPA’s goal is to have in place in Texas 

the necessary permitting authority by 

the time businesses seeking 

construction permits need to have their 

applications processed and the permits 

issued—and to achieve that outcome by 

means of engaging with Texas directly 

through a concerted process of 

consultation and support. 

EPA is taking up the additional task 

of partially disapproving Texas’s PSD 

program and promulgating the FIP at 

this time only because the Agency 

believes it is compelled to do so by the 

need to assure businesses, to the 

maximum extent possible and as 

promptly as possible, that a permitting 

authority is available to process PSD 

permit applications for GHG-emitting 

sources once they become subject to 

PSD requirements. At the same time, we 

invite Texas to accept a delegation of 

authority to implement the FIP, so that 

it will still be the state that processes 

the permit applications, albeit operating 

under Federal law. 

V. Statutory and Executive Order 

Reviews 

A. Executive Order 12866: Regulatory 

Planning and Review and Executive 

Order 13563: Improving Regulations 

and Regulatory Review 

Under Executive Orders (EO) 12866 

(58 FR 51,735, October 4, 1993) and 

13563 (76 FR 3,821, January 21, 2011), 

this action is a ‘‘significant regulatory 

action’’ because it raises novel legal or 

policy issues. Accordingly, EPA 

submitted this action to the Office of 

Management and Budget (OMB) for 

review under EOs 12866 and 13563 and 

any changes made in response to OMB 

recommendations have been 

documented in the docket for this 

action. 

B. Paperwork Reduction Act 

This action does not impose any new 

information collection burden. The 

OMB has previously approved the 

information collection requirements 

contained in the existing regulations for 

PSD (see, e.g., 40 CFR 52.21) and title 

V (see 40 CFR parts 70 and 71) under 

the provisions of the Paperwork 

Reduction Act, 44 U.S.C. 3501 et seq. 

and has assigned OMB control number 

2060–0003 and OMB control number 

2060–0336 respectively. The OMB 

control numbers for EPA’s regulations 

in 40 CFR are listed in 40 CFR part 9. 

C. Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA) 

generally requires an agency to prepare 

a regulatory flexibility analysis of any 

rule subject to notice and comments 

rulemaking requirements under the 

Administrative Procedure Act or any 

other statute unless the agency certifies 

that the rule will not have a significant 

economic impact on a substantial 

number of small entities. Small entities 

include small businesses, small 

organizations, and small governmental 

jurisdictions. 

For purposes of assessing the impacts 

of this rule on small entities, small 

entity is defined as: (1) A small business 

as defined in the U.S. Small Business 

Administration’s (SBA) regulations at 13 

CFR 121.201); (2) a small governmental 

jurisdiction that is a government of a 

city, county, town, school district, or 

special district with a population of less 

than 50,000; or (3) a small organization 

that is any not-for-profit enterprise that 

is independently owned and operated 

and is not dominant in its field. 

Although this rule would lead to 

Federal permitting requirements for 

certain sources, those sources are large 

emitters of GHGs. After considering the 

economic impacts of this rule on small 

entities, I certify that this action will not 

have a significant economic impact on 

a substantial number of small entities. 

This final rule will not impose any 

requirements on small entities. 

D. Unfunded Mandates Reform Act 

This action contains no Federal 

mandates under the provisions of Title 

II of the Unfunded Mandates Reform 

Act of 1995 (UMRA, 2 U.S.C. 1531– 

1538) for state, local or Tribal 

governments or the private section. The 

action imposes no enforceable duty on 

any state, local or Tribal governments or 

the private sector. With this action, EPA 

is only revising its previous approval of 

the Texas PSD SIP to be a partial 

approval and partial disapproval and 

promulgating a FIP to address the 

deficiencies as authorized by the CAA. 

Thus, this rule is not subject to the 

requirements of sections 202 or 205 of 

UMRA. 

This action is also not subject to the 

requirements of section 203 of UMRA 

because it contains no regulatory 

requirements that might significantly or 

uniquely affect small governments. 

E. Executive Order 13132—Federalism 

This action does not have federalism 

implications. It will not have substantial 

direct effects on Texas, on the 

relationship between the national 

government and Texas, or on the 

distribution of power and 

responsibilities among the various 

levels of government, as specified in 

Executive Order 13132. The CAA 

specifies conditions under which states 

may request, and EPA may approve 

state implementation of CAA 

requirements. The CAA also specifies 

the action EPA is to take, including 

issuing a FIP, when states have not met 

their requirements under the CAA. This 

rulemaking does not change that 

distribution of power between the states 

and EPA. With this action, EPA is only 

revising its previous approval of the 

Texas PSD SIP to be a partial approval 

and partial disapproval and 

promulgating a FIP to address the 

deficiencies identified in the Texas SIP 

as authorized by the CAA. Thus, 

Executive Order 13132 does not apply 

to this action. 

In the spirit of Executive Order 13132, 

and consistent with EPA policy to 

promote communications between EPA 

and state and local governments, EPA 

solicited comment on the proposal for 

this action. Comments from state 

government organizations are addressed 

within this preamble and supporting 

materials available in the docket for this 

rulemaking. 

F. Executive Order 13175—Consultation 

and Coordination With Indian Tribal 

Governments 

This action does not have Tribal 

implications, as specified in Executive 

Order 13175 (65 FR 67,249, November 

9, 2000). In this action, EPA is not 

addressing any Tribal implementation 

plans. This action is limited to Texas’s 


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25208 Federal Register / Vol. 76, No. 85 / Tuesday, May 3, 2011 / Rules and Regulations 

PSD SIP. Thus, Executive Order 13175 

does not apply to this action. 

G. Executive Order 13045—Protection of 

Children From Environmental Health 

Risks and Safety Risks 

EPA interprets EO 13045 (62 FR 

19,885, April 23, 1997) as applying only 

to those regulatory actions that concern 

health or safety risks, such that the 

analysis required under section 5–501 of 

the EO has the potential to influence the 

regulation. This action is not subject to 

EO 13045 because EPA is only revising 

its previous approval of the Texas PSD 

SIP to be a partial approval and partial 

disapproval and promulgating a FIP to 

address the deficiencies as authorized 

by the CAA. 

H. Executive Order 13211—Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use 

This action is not a ‘‘significant energy 

action’’ as defined in Executive Order 

13211 (66 FR 28,355 (May 22, 2001)), 

because it is not likely to have a 

significant adverse effect on the supply, 

distribution, or use of energy. With this 

action, EPA is only revising its previous 

approval of the Texas PSD SIP to be a 

partial approval and partial disapproval 

and promulgating a FIP to address the 

deficiencies as authorized by the CAA. 

This action will provide energy facilities 

in Texas that are large emitters of GHG 

a mechanism to get necessary PSD 

permits to construct or modify. 

I. National Technology Transfer and 

Advancement Act 

Section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (‘‘NTTAA’’), Public Law 

104–113, 12(d) (15 U.S.C. 272 note) 

directs EPA to use voluntary consensus 

standards in its regulatory activities 

unless to do so would be inconsistent 

with applicable law or otherwise 

impractical. Voluntary consensus 

standards are technical standards (e.g., 

materials specifications, test methods, 

sampling procedures, and business 

practices) that are developed or adopted 

by voluntary consensus standards 

bodies. NTTAA directs EPA to provide 

Congress, through OMB, explanations 

when the Agency decides not to use 

available and applicable voluntary 

consensus standards. 

This rulemaking does not involve 

technical standards. Therefore, EPA is 

not considering the use of any voluntary 

consensus standards. 

J. Executive Order 12898—Federal 

Actions To Address Environmental 

Justice in Minority Populations and 

Low-Income Populations 

Executive Order 12898 (59 FR 7,629, 

February 16, 1994) establishes Federal 

executive policy on environmental 

justice. Its main provision directs 

Federal agencies, to the greatest extent 

practicable and permitted by law, to 

make environmental justice part of their 

mission by identifying and addressing, 

as appropriate, disproportionately high 

and adverse human health or 

environmental effects of their programs, 

policies, and activities on minority 

populations and low-income 

populations in the U.S. 

EPA has determined that this final 

rule will not have disproportionately 

high and adverse human health or 

environmental effects on minority or 

low-income populations because it does 

not affect the level of protection 

provided to human health or the 

environment. With this action, EPA is 

only revising its previous approval of 

the Texas PSD SIP to be a partial 

approval and partial disapproval and 

promulgating a FIP to address the 

deficiencies as authorized by the CAA. 

K. Congressional Review Act 

The Congressional Review Act, 5 

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

Small Business Regulatory Enforcement 

Fairness Act of 1996, generally provides 

that before a rule may take effect, the 

agency promulgating the rule must 

submit a rule report, which includes a 

copy of the rule, to each House of the 

Congress and to the Comptroller General 

of the United States. Section 808 allows 

the issuing agency to make a rule 

effective sooner than otherwise 

provided by the CRA if the agency 

makes a good cause finding that notice 

and public procedure is impracticable, 

unnecessary, or contrary to the public 

interest. This determination must be 

supported by a brief statement, 5 U.S.C. 

808(2). As stated previously, EPA has 

made such a good cause finding, 

including the reasons therefore, and 

established an effective date of May 1, 

2011. EPA will submit a report 

containing this rule and other required 

information to the United States Senate, 

the United States House of 

Representatives, and the Comptroller 

General of the United States prior to 

publication of the rule in the Federal 

Register. This action is not a ‘‘major 

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

VI. Judicial Review 

Section 307(b)(1) of the CAA specifies 

which Federal Courts of Appeal have 

jurisdiction to hear petitions for review 

of which final actions by EPA. This 

section provides, in part, that petitions 

for review must be filed in the Court of 

Appeals for the District of Columbia 

Circuit: (i) When the agency action 

consists of ‘‘nationally applicable 

regulations promulgated, or final actions 

taken, by the Administrator,’’ or (ii) 

when such action is locally or regionally 

applicable, if ‘‘such action is based on a 

determination of nationwide scope or 

effect and if in taking such action the 

Administrator finds and publishes that 

such action is based on such a 

determination.’’ 

This rule is based on a determination 

of nationwide scope or effect. Texas’s 

response to the SIP call—including 

Texas’s statements that it does not 

intend to submit a SIP revision and its 

decision not to identify a SIP submittal 

deadline, which have placed its sources 

at risk for delays in construction or 

modification—led us to determine that 

we should examine whether there may 

be a flaw in Texas’s SIP that was present 

at the time of our approval. We then 

conducted a closer inquiry and on the 

basis of that, we are concluding that in 

fact a flaw was present. As a result, we 

are authorized to undertake an error 

correction, as we are doing in this 

rulemaking. For all other states subject 

to the SIP call, their response to the SIP 

call—which did not raise the concerns 

Texas’s did and which assured that their 

sources would not be at risk for delays 

in construction or modification—led us 

to determine that it was not necessary 

to examine further whether their SIPs 

were flawed at the time we approved 

them. That determination—whether to 

examine the SIPs further—is a 

determination of nationwide scope or 

effect because it affected Texas and the 

12 other states subject to the SIP call. 

Further indication that this is a 

determination is of nationwide scope or 

effect is that EPA is making it as part of 

the complex of rules EPA has 

promulgated to implement the GHG 

PSD program for each of the states in the 

nation. Those rules include (i) the 

Tailoring Rule and the Johnson Memo 

Reconsideration, which revise EPA 

regulations to incorporate the Tailoring 

Rule thresholds, and which apply in 

each state that does not have an 

approved SIP PSD program, and 

therefore operates under EPA’s 

regulations; (ii) the SIP Call, which 

applies in each state that has an EPAapproved SIP PSD program but does not 

apply that program to GHG-emitting 

sources; and (iii) the PSD Narrowing 

rule, which applies in each state that 

has an EPA-approved SIP PSD program 


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Federal Register / Vol. 76, No. 85 / Tuesday, May 3, 2011 / Rules and Regulations 25209 

that does apply to GHG-emitting 

sources. 

Thus, under section 307(b)(1) of the 

Act, judicial review of this final action 

is available by filing of a petition for 

review in the U.S. Court of Appeals for 

the District of Columbia Circuit by July 

5, 2011. 

Pursuant to CAA section 307(d)(1)(B), 

this action is subject to the requirements 

of CAA section 307(d) to the extent it 

promulgates a FIP under CAA section 

110(c). In addition, pursuant to CAA 

section 307(d)(1)(V), which authorizes 

the Administrator to determines that 

actions other than those specifically 

listed in CAA section 307(d)(1) are 

subject to the provisions of CAA section 

307(d), EPA is making that 

determination for this action to the 

extent it constitutes an error correction 

under CAA section 110(k)(6); a 

rescission of EPA’s previous approval 

and a limited approval and disapproval 

of Texas’s PSD SIP, under CAA section 

110(k)(3); or any other action. 

IX. Statutory Authority 

The statutory authority for this action 

is provided by sections 101, 110, 114, 

116, 301, and 307(d) of the CAA as 

amended (42 U.S.C. 7401, 7410, 7414, 

7416, 7601, and 7607(d)). 

List of Subjects in 40 CFR Part 52 

Air pollution control, Carbon dioxide, 

Carbon dioxide equivalents, Carbon 

monoxide, Environmental protection, 

Greenhouse gases, Hydrofluorocarbons, 

Incorporation by reference; 

Intergovernmental relations, Lead, 

Methane, Nitrogen dioxide, Nitrous 

oxide, Ozone, Particulate matter, 

Perfluorocarbons, Reporting and 

recordkeeping requirements, Sulfur 

hexafluoride, Sulfur oxides, Volatile 

organic compounds. 

Dated: April 22, 2011. 

Lisa P. Jackson, 

Administrator. 

For the reasons set out in the 

preamble, title 40, chapter I of the Code 

of Federal Regulations is amended as 

follows: 

PART 52—[Amended] 

■ 1. The authority citation for part 52 

continues to read as follows: 

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

■ 2. Section 52.2305 is added to read as 

follows: 

§ 52.2305 What are the requirements of the 

Federal Implementation Plan (FIP) to issue 

permits under the Prevention of Significant 

Deterioration requirements to sources that 

emit greenhouse gases? 

(a) The requirements of sections 160 

through 165 of the Clean Air Act are not 

met to the extent the plan, as approved, 

for Texas does not apply with respect to 

emissions of the pollutant GHGs from 

certain stationary sources. Therefore, 

the provisions of § 52.21 except 

paragraph (a)(1) are hereby made a part 

of the plan for Texas for: 

(1) Beginning on May 1, 2011, the 

pollutant GHGs from stationary sources 

described in § 52.21(b)(49)(iv), and 

(2) Beginning July 1, 2011, in addition 

to the pollutant GHGs from sources 

described under paragraph (a)(1) of this 

section, stationary sources described in 

§ 52.21(b)(49)(v). 

(b) For purposes of this section, the 

‘‘pollutant GHGs’’ refers to the pollutant 

GHGs, as described in § 52.21(b)(49)(i). 

(c) In addition, the United States 

Environmental Protection Agency shall 

take such action as is appropriate to 

assure the application of PSD 

requirements to sources in Texas for any 

other pollutants that become subject to 

regulation under the Federal Clean Air 

Act for the first time after January 2, 

2011. 

[FR Doc. 2011–10285 Filed 4–29–11; 8:45 am] 

BILLING CODE 6560–50–P 


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