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###### Environmental Protection Agency

          - 40 CFR Part 52 
          - [TX-114-2-7480; FRL-6904-2] 

# AGENCY:

Environmental Protection Agency (EPA). 

# ACTION:

Proposed rule. 

# SUMMARY:

We, the EPA, propose to fully approve a State Implementation Plan (SIP) revision submitted by the State of Texas establishing a low-Reid Vapor Pressure (RVP) fuel requirement for gasoline distributed in 95 counties in the eastern and central parts of Texas. Texas developed this fuel requirement to reduce emissions of volatile organic compounds (VOC) as part of the State's strategy to achieve the National Ambient Air Quality Standard (NAAQS) for ozone in the Houston and Dallas-Fort Worth nonattainment areas. We are approving Texas' fuel requirements into the SIP because we found that the fuel requirement is in accordance with the requirements of the Clean Air Act (the Act) as amended in 1990 and is necessary for these nonattainment areas to achieve the ozone NAAQS. 

# DATES:

Comments should be received on or before December 20, 2000. 

# ADDRESSES:

                        Written comments on this action should be addressed to Mr. Thomas H. Diggs, Chief, Air Planning Section, at the EPA Regional Office listed below. Copies of the documents relevant to this action are available for public inspection during normal business hours at the following                               ( print page 69721)                            locations. Environmental Protection Agency, Region 6, Air Planning Section (6PD-L), 1445 Ross Avenue, Suite 700, Dallas, Texas 75202-2733. Texas Natural Resource Conservation Commission, 12100 Park 35 Circle, Austin, Texas 78711-3087. Persons interested in examining these documents should make an appointment with the appropriate office at least 24 hours before the visiting day.                     

# FOR FURTHER INFORMATION CONTACT:

Sandra Rennie, Air Planning Section (6PD-L), EPA Region 6, 1445 Ross Avenue, Dallas, Texas 75202-2733, telephone (214) 665-7214. 

# SUPPLEMENTARY INFORMATION: 

## What Does the State's Low-RVP Regulation Include? 

The State's low-RVP regulation requires that gasoline sold within the 95 attainment counties listed in the regulations have a maximum RVP of 7.8 psi. The regulations apply to gasoline sold at gasoline dispensing facilities between June 1 and October 1 of each year, and between May 1 and October 1 of each year for bulk plants, gasoline terminals and gasoline storage vessels. 

The 95 central and eastern Texas counties affected by these rules are Anderson, Angelina, Aransas, Atascosa, Austin, Bastrop, Bee, Bell, Bexar, Bosque, Bowie, Brazos, Burleson, Caldwell, Calhoun, Camp, Cass, Cherokee, Colorado, Comal, Cooke, Coryell, De Witt, Delta, Ellis, Falls, Fannin, Fayette, Franklin, Freestone, Goliad, Gonzales, Grayson, Gregg, Grimes, Guadalupe, Harrison, Hays, Henderson, Hill, Hood, Hopkins, Houston, Hunt, Jackson, Jasper, Johnson, Karnes, Kaufman, Lamar, Lavaca, Lee, Leon, Limestone, Live Oak, Madison, Marion, Matagorda, McLennan, Milam, Morris, Nacogdoches, Navarro, Newton, Nueces, Panola, Parker, Polk, Rains, Red River, Refugio, Robertson, Rockwall, Rusk, Sabine, San Jacinto, San Patricio, San Augustine, Shelby, Smith, Somervell, Titus, Travis, Trinity, Tyler, Upshur, Van Zandt, Victoria, Walker, Washington, Wharton, Williamson, Wilson, Wise, and Wood Counties. 

## How Does the Low-RVP Proposal Relate to Other SIP Activities in the State? 

Current planning efforts by the State are directed at three nonattainment areas, Houston-Galveston (HGA), Dallas-Fort Worth (DFW), and Beaumont-Port Arthur (BPA). The attainment demonstration SIPs for two of these areas rely upon the low-RVP fuel to make their demonstrations. The SIPs are: 

(1) The Dallas Attainment Demonstration, adopted on April 19, 2000, and submitted on April 25, 2000. 

(2) The Houston Attainment Demonstration, proposed by the State on August 9, 2000. It will be submitted to EPA no later than December 2000. 

                    Texas has adopted a Regional SIP to complement these attainment demonstration SIPs for Houston and Dallas, and provide additional emission reductions necessary for these areas to attain the ozone NAAQS. The Texas Regional SIP includes a list of controls that apply in the attainment areas surrounding these nonattainment areas. Specifically, the Texas Regional SIP includes three control programs to reduce emissions of nitrogen oxides (NOX) and VOC: a regional low-RVP fuel program (the subject of this action), a stationary source program, and a Stage I vapor recovery program.                 

## What Is Proposed? 

We are proposing to approve a SIP revision establishing a low-RVP fuel requirement for gasoline sold in the 95 eastern and central counties of Texas. The State's low-RVP program will only apply in the listed attainment counties and will not apply in the designated nonattainment counties in the HGA, DFW, or BPA areas because these areas are already subject to federal fuel controls that are at least as stringent. 

## What Are the Clean Air Act Requirements? 

This action is pursuant to section 110 of the Act. The approval of the State's fuel control measure must also meet the requirements of section 211(c)(4)(C). Under this section, we may approve a state fuel control into a SIP if we find that the control is “necessary” to achieve a NAAQS. 

The EPA's August 21, 1997, Guidance on Use of Opt-in to RFG and Low-RVP Requirements in Ozone SIPs gives further guidance on what EPA is likely to consider in making a finding of necessity. The guidance sets out four issues to be analyzed: 

1. The quantity of emissions reductions needed to achieve the NAAQS; 

2. Other possible control measures and the reductions each would achieve; 

3. The explanation for rejecting alternatives as unreasonable or impracticable; and 

4. A demonstration that reductions are needed even after implementation of reasonable and practicable alternatives, and that the fuel control will provide some or all or the needed reductions. 

In this notice of proposed rulemaking and accompanying Technical Support Document (TSD), we address these issues in a slightly different fashion. Though somewhat differently stated, the 4 items listed for consideration in the guidance are covered by the review done for this submittal. First, we explain the way in which the low-RVP program will help the nonattainment areas achieve the NAAQS. This serves the same purpose as the first item listed in the Guidance. Though we do not discuss the specific amount of reductions needed, this is the basis for satisfying the necessity showing required by the Clean Air Act. Second, we review the reasonableness and practicability of non-fuel control alternatives. This satisfies the second and third items listed in the Guidance and meets the specific requirements of section 211(c)(4)(C). Finally, we show that with implementation of all reasonable and practicable control measures and the regional fuel controls, the Houston and Dallas nonattainment areas may be able to just attain the ozone NAAQS but the ozone design value for these areas is expected to continue to exceed the one hour standard for ozone. This meets item number 4 in the Guidance and rounds off the demonstration that the measure is necessary. 

## What Did the State Submit? 

The State submitted this revision to the SIP by letter from the Governor dated August 16, 1999. This was followed by two technical supplements dated October 13, 1999, and February 11, 2000. The SIP submittal contains Chapter 114, Texas Administrative Code (TAC), as adopted on June 30, 1999, and April 19, 2000, a request for a waiver from federal preemption pursuant to section 211(c)(4)(C) of the Act, and Texas laws providing the authority for the State to adopt and implement revisions to the SIP. 

                    Texas submitted data and analyses to support a finding under section 211(c)(4)(C) that the State's low-RVP requirement is necessary for the DFW and HGA nonattainment areas to achieve the ozone NAAQS. The State has (1) identified the reduction in modeled peak values needed to achieve attainment of the ozone NAAQS; (2) identified all other reasonable and practical control measures; (3) shown that even with the implementation of all reasonable and practicable control measures, the State would need additional emissions reductions for these nonattainment areas to meet the ozone NAAQS (124 ppb) on a timely basis; and (4) demonstrated that the low-RVP requirement would contribute to those additional reductions.                           ( print page 69722)    

## Why Is the State Submitting this SIP for Low-RVP Gasoline in Attainment Areas of Texas? 

Lowering the RVP in gasoline reduces VOC emissions. This is primarily through reducing evaporative losses from vehicle fuel tanks, lines, and carburetors as well as losses from gasoline storage and transfer facilities. To a lesser degree there is also a reduction in the VOCs in vehicle exhaust. Without the proposed fuel controls, the 95-county area subject to the proposed fuel control would receive gasoline with an RVP of up to 9.0 psi during the summer months. The State, based on modeling results using EPA's complex model, estimates that the proposed regional low-RVP program will reduce VOC emissions from automobiles by at least 14%. 

Ozone and the precursor pollutants that cause ozone can be transported into an area from pollution sources hundreds of miles upwind. In order to address ozone pollution, EPA has traditionally focused its control strategies on reducing emissions within the nonattainment areas. EPA and states, however, have become increasingly aware of the contribution to ozone nonattainment from upwind sources of ozone and its precursors. Modeling and other analyses support the conclusion that lowering VOC emissions through Texas' regional low-RVP program will benefit the DFW and HGA nonattainment areas through one or more of three mechanisms: reducing ozone transport, reducing VOC transport, and reducing the transport of higher RVP gasoline into the nonattainment areas in commuters' vehicles. Each of these mechanisms is discussed in more detail in the TSD for this proposal. 

The analysis in the TSD suggests that the low-RVP control in various counties will benefit the nonattainment areas in different ways. For some counties the primary benefit will be the reduction of ozone transport from those counties to the nonattainment counties, while in others the primary benefit will be a reduction in the emissions from commuters' vehicles. A single RVP control throughout the 95-county area captures all the attainment counties contributing to nonattainment in the DFW and HGA areas, and avoids a patchwork of fuel controls. We therefore agree with the State that it is reasonable to adopt a uniform program throughout the 95-county area to allow fuel supplies to be co-mingled in the pipeline, promote trading, and simplify tracking compliance. 

## Are There Any Reasonable and Practicable Alternatives to the Regional Low-RVP Program? 

The State conducted thorough analyses of control measures available to benefit the DFW and HGA nonattainment areas. The HGA and DFW SIPs contain long lists of stationary source controls that are or will be required, expansion and upgrading of the vehicle inspection and maintenance programs, and a host of other measures that must be implemented including a ban on the use of residential lawn and garden equipment before noon during the summer in the HGA nonattainment area and delay of construction activities during daylight savings time in both HGA and DFW nonattainment areas. The attainment SIPs use a weight-of-evidence (WOE) analysis to show that implementation of all reasonable and practicable controls, including the regional low-RVP program, should just bring the DFW area into attainment. Attainment demonstration modeling for all nonattainment areas suggests that even with the implementation of all reasonable and practicable controls, the modeled peak value for the areas may exceed the 1-hour ozone standard and that additional reductions are necessary to achieve the standard. 

The Metropolitan Planning Organizations in both the DFW and HGA areas examined several hundred options for potential reductions in each nonattainment area. At this point in time, other non-fuel reductions are either non-existent or considered impracticable. Texas also submitted a long list of non-fuel measures that it considered for implementation outside the nonattainment areas. These measures were also found by the State to be unreasonable or impracticable based primarily on cost and the time required to implement the measures. 

Based on the State's analysis of the cost-effectiveness and the time required to implement these measures, we agree that there are no reasonable or practicable non-fuel control measures available to the State to achieve the ozone NAAQS. Compared to all measures outlined in the TSD, low-RVP fuel is the most reasonable and practicable measure available to reduce background ozone levels and curtail the transport of ozone and precursors into the nonattainment areas. The State estimates that the cost for implementing the low-RVP fuel will be less than 0.3 cents per gallon. In addition, the benefits of the low-RVP program will be felt immediately upon implementation. 

The TSD includes a detailed review of the controls that the State has already proposed or adopted and the reasonableness and practicability of the non-fuel alternatives that are still available. A more complete description of the State's analysis of the measures considered for the attainment area may also be found in the October 13, 1999 technical supplement submitted by the State. 

## Is the Regional Low-RVP Fuel Control Program Necessary for Achieving the NAAQS? 

The 1996 document, Guidance on Using Modeled Results to Demonstrate Attainment of the Ozone NAAQS, presents two approaches to demonstrating attainment, a statistical approach and a deterministic approach. For the purposes of the attainment demonstrations submitted for the DFW, and proposed for the HGA nonattainment areas, the deterministic approach was used. Though EPA's review is far from complete, CAMx modeling for both attainment demonstrations appears to predict that even with implementation of all reasonable and practicable measures, including the regional low-RVP control, the design values for the nonattainment areas will still be above the 1-hour ozone standard. It should be noted that EPA is working with the State to bring the areas into attainment. EPA will address the design value modeling and attainment demonstration for the various areas in separate actions to be published at future dates. 

Preliminary review of attainment demonstration modeling submitted on April 25, 2000, for DFW appears to indicate that with all measures taken into account in the model, including the regional low-RVP program, the modeled peak value for the DFW area remains very close to or in excess of the NAAQS. Therefore, it is apparent that every ton of ozone reduction is necessary to achieve the 1-hour standard including those that result from the other measures adopted and proposed for the 95 attainment counties. 

                    The Houston modeling submitted in November, 1999, showed, after modeling extensive controls including the low-RVP program, an estimated shortfall of 118 tpd of NOX                    . The shortfall of NOX                     represents additional reductions that the model would require to show a modeled peak ozone value of 124 ppb. While modeling submitted in November, 1999, indicated only a very slight benefit from VOC controls, more recent models which support the proposed attainment demonstration SIP                           ( print page 69723)                        for HGA indicate a clear need for VOC reductions.                 

                    Further, Texas performed regional modeling (submitted in April 2000) which demonstrated that the VOC reductions provided by the regional low-RVP control are necessary to reduce ozone in the nonattainment areas. The models predicted that a mixture of NOX                     and VOC controls, including the regional low-RVP control, would reduce modeled peak values. Texas proposed another revision to the Houston SIP on August 9, 2000. The new proposal with revised emission estimates has an estimated NOX                     shortfall of only 78 tpd. As mentioned above, the modeling in the new proposal shows a greater sensitivity to VOC controls than previous modeling studies.                 

## Does the State Submittal Meet the SIP Approval Requirements Under Section 110? 

The Texas Regional SIP submittal, including the regional low-RVP fuel control program, meets the requirements outlined in section 110. The Texas rules for this SIP include adequate enforceability measures. 

Texas submitted the fuel portion of the Texas Regional SIP under a Governor's letter dated August 16, 1999. The submittal contains the appropriate hearing actions, a preamble, and the regional low-RVP rules. The State also submitted technical supplements dated October 13, 1999, and February 11, 2000, that provided data on commuter patterns and an analysis of measures considered for the attainment area. The SIP was deemed complete by operation of law on February 16, 2000. 

On February 9, 2000, the State proposed revisions to the fuel rules previously adopted in 30 TAC 114. Revisions included strengthening the enforcement provisions. The State adopted these rules on April 5, 2000. Revised chapter 114 rules were submitted under a Governor's letter dated April 25, 2000. The revisions strengthened enforcement provisions that EPA requested during the public comment period for the original submittal. 

## How Will the Program Be Enforced? 

The Texas Natural Resource Conservation Commission will implement the low-RVP rule. Producers, importers, terminals, pipelines, truckers, rail carriers, and retail dispensing outlets are subject to provisions of this rule. Registration, recordkeeping, reporting, and certification requirements are included. 

We find that these rules are an acceptable approach for enforcing the low-RVP gasoline program. 

## Proposed Action By EPA 

Texas' regional low-RVP program will provide needed VOC and ozone reductions for the DFW and HGA ozone nonattainment areas. Without the program, the modeled peak ozone values for the nonattainment areas will continue to exceed the 1-hour ozone standard. The State demonstrated that the regional low-RVP fuel control program is necessary to help the DFW and HGA nonattainment areas achieve the 1-hour ozone standard and that no other reasonable or practicable alternatives remain that would bring about timely attainment. We are proposing to approve the Texas Regional Low-RVP Gasoline Program into the Texas SIP under § 110(k)(3) of the CAA as meeting the requirements of § 110(a) and Part D. We are also proposing to find that this SIP revision meets the requirements of section 211(c)(4)(C) of the Act. 

Nothing in this action should be construed as permitting or allowing or establishing a precedent for any future implementation plan. Each request for revision to the State Implementation Plan shall be considered separately in light of specific technical, economic, and environmental factors and in relation to relevant statutory and regulatory requirements. 

## Administrative Requirements 

                    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this proposed action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. This proposed action merely approves state law as meeting federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Regional Administrator certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601*et seq.*). Because this rule proposes to approve pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4). For the same reason, this proposed rule also does not significantly or uniquely affect the communities of tribal governments, as specified by Executive Order 13084 (63 FR 27655, May 10, 1998). This proposed rule will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely approves a state rule implementing a federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. This proposed rule also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is not economically significant.                 

                    In reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. In this context, in the absence of a prior existing requirement for the State to use Voluntary Consensus Standards (VCS), EPA has no authority to disapprove a SIP submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews a SIP submission, to use VCS in place of a SIP submission that otherwise satisfies the provisions of the Clean Air Act. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this proposed rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of the rule in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings' issued under the executive order. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501*et seq.*).                 

# List of Subjects in 40 CFR Part 52

      - Environmental protection
      - Air pollution control
      - Carbon monoxide
      - Hydrocarbons
      - Intergovernmental relations
      - Nitrogen dioxide
      - Ozone
      - Particulate matter
      - Reporting and recordkeeping requirements
      - Sulfur oxides
      - Volatile organic compounds

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

      ( print page 69724)    
Dated: November 3, 2000. 

Myron O. Knudson, 

Acting Regional Administrator, Region 6. 

[FR Doc. 00-29645 Filed 11-17-00; 8:45 am] 

BILLING CODE 6560-50-P