```

[Federal Register Volume 77, Number 55 (Wednesday, March 21, 2012)]
[Proposed Rules]
[Pages 16509-16512]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-6676]

-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[EPA-R09-OAR-2011-0955; FRL-9649-4]

Proposed Approval of Revision of Five California Clean Air Act 
Title V Operating Permits Programs

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: EPA is proposing to approve revisions to the Operating Permits 
(Title V) programs of the Monterey Bay Unified Air Pollution Control 
District (MBUAPCD), San Luis Obispo County Air Pollution Control 
District (SLOCAPCD), Santa Barbara County Air Pollution Control 
District (SBCAPCD), South Coast Air Quality Management District 
(SCAQMD), and Ventura County Air Pollution Control District (VCAPCD). 
These program revisions will require sources with the potential to emit 
(PTE)of greenhouse gas (GHG) above the thresholds in EPA's Tailoring 
Rule that have not been previously subject to Title V for other reasons 
to obtain a Title V permit. See ``Prevention of Significant 
Deterioration and Title V Greenhouse Gas Tailoring Rule; Final Rule,'' 
(the Tailoring Rule), 75 FR 31514 (June 3, 2010). We are taking 
comments on this proposal and plan to follow with a final action.

DATES: Any comments must arrive by April 20, 2012.

ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2011-0955, by one of the following methods:
    1. Federal eRulemaking Portal: www.regulations.gov. Follow the on-
line instructions.
    2. Email: R9airpermits@epa.gov.
    3. Mail or deliver: Gerardo Rios (Air-3), U.S. Environmental 
Protection Agency Region IX, 75 Hawthorne Street, San Francisco, CA 
94105-3901.
    Instructions: All comments will be included in the public docket 
without change and may be made available online at www.regulations.gov, 
including any personal information provided, unless the comment 
includes Confidential Business Information (CBI) or other information 
whose disclosure is restricted by statute. Information that you 
consider CBI or otherwise protected should be clearly identified as 
such and should not be submitted through www.regulations.gov or email. 
www.regulations.gov is an ``anonymous access'' system, and EPA will not 
know your identity or contact information unless you provide it in the 
body of your comment. If you send email directly to EPA, your email 
address will be automatically captured and included as part of the 
public comment. If EPA cannot read your comment due to technical 
difficulties and cannot contact you for clarification, EPA may not be 
able to consider your comment. Electronic files should avoid the use of 
special characters, any form of encryption, and be free of any defects 
or viruses.
    Docket: EPA has established a docket for this action under EPA-R09-
OAR-2011-0955. Generally, documents in the docket for this action are 
available electronically at www.regulations.gov or in hard copy at EPA 
Region IX, 75 Hawthorne Street, San Francisco, CA 94105. While all 
documents are listed at www.regulations.gov, some information may be 
publicly available only at the hard copy location (e.g., copyrighted 
material, large maps, multi-volume reports), and some may not be 
publicly available in either location (e.g., CBI). To inspect the hard 
copy materials, please schedule an appointment during normal business 
hours with the contact listed in the FOR FURTHER INFORMATION CONTACT 
section.

FOR FURTHER INFORMATION CONTACT: Roger Kohn, EPA Region IX, (415) 972-
3973, kohn.roger@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document, ``we,'' ``us'' and 
``our'' refer to EPA.

Table of Contents

I. The State's Submittal
    A. What rules did the State submit?
II. The Part 70 Operating Permits Program
    A. What is the Part 70 operating permits program?
    B. How did EPA revise Part 70 to address Title V permitting of 
GHG sources?

[[Page 16510]]

    C. What is the federal approval process for revisions to a Part 
70 operating permits program?
III. EPA's Evaluation and Action
    A. How is EPA evaluating the rules?
    B. Do the rules meet the evaluation criteria?
    C. Public Comment and Proposed Action
IV. Statutory and Executive Order Reviews

I. The State's Submittal

 A. What rules did the State submit?

    Table 1 lists the rules addressed by this proposal with the dates 
that they were adopted by the local air agencies and submitted by the 
California Air Resources Board.

                                            Table 1--Submitted Rules
----------------------------------------------------------------------------------------------------------------
              Local agency                 Rule No.               Rule title              Adopted     Submitted
----------------------------------------------------------------------------------------------------------------
MBUAPCD................................         218    Title V: Federal Operating          11/17/10      11/7/11
                                                        Permits.
SLOCAPCD...............................         216    Federal Part 70 Operating            3/23/11      8/19/11
                                                        Permits.
SBCAPCD................................        1301    Part 70 Operating Permits--          1/20/11      4/21/11
                                                        General Information.
SCAQMD.................................        3000    General........................      11/5/10      11/5/10
                                               3001    Applicability..................
                                               3002    Requirements...................
                                               3003    Applications...................
                                               3005    Permit Revisions...............
                                               3006    Public Participation...........
VCAPCD.................................          33    Part 70 Permits--General.......      4/12/11      8/19/11
                                                 33.1  Part 70 Permits--Definitions...
----------------------------------------------------------------------------------------------------------------

II. The Part 70 Operating Permits Program

A. What is the Part 70 operating permits program?

    Title V of the Clean Air Act (CAA) Amendments of 1990 require all 
states to develop an operating permits program that meets federal 
criteria listed in 40 Code of Federal Regulations (CFR) Part 70. In 
implementing this program, the states are to require certain sources of 
air pollution to obtain permits that contain all applicable 
requirements under the CAA. One purpose of the Part 70 operating 
permits program (also known as the Title V program) is to improve 
enforcement and compliance by issuing each source a single permit that 
consolidates all of the applicable CAA requirements into a federally-
enforceable document. By consolidating all of the applicable 
requirements for a facility into one document, the source, the public, 
and the permitting authorities can more easily determine what CAA 
requirements apply and how compliance with those requirements is 
determined.

B. How did EPA revise Part 70 to address Title V permitting of GHG 
sources?

    In the Tailoring Rule (75 FR 31514, June 3, 2010), we amended the 
definition of ``major source'' in Part 70 by codifying EPA's 
longstanding interpretation that applicability for a ``major stationary 
source'' under CAA sections 501(2)(B) and 302(j) and 40 CFR 70.2 is 
triggered by sources of pollutants ``subject to regulation.'' We also 
added a definition of ``subject to regulation'' to clarify that this 
phrase means a pollutant subject to either a provision in the CAA or a 
regulation adopted by EPA under the CAA that requires actual control of 
emissions of that pollutant and that has taken effect under the CAA. 
Finally, to tailor the Title V program for GHGs, we also included a 
second component within the definition of ``subject to regulation,'' 
specifying that GHGs are not subject to regulation for purposes of 
defining a major source, unless as of July 1, 2011, the GHG emissions 
are from a source emitting or having the potential to emit 100,000 tons 
per year (tpy) of GHGs on a carbon dioxide equivalent (CO2e) basis. We 
defined the term ``greenhouse gases'' with a cross-reference to the 
definition in 40 CFR 86.1818-12(a). The combined effect of these Part 
70 amendments is to revise the Title V program to require stationary 
sources that have the potential to emit 100,000 tpy or more of GHGs on 
a CO2e basis to obtain Title V permits, regardless of whether they are 
subject to any CAA requirement to control their GHG emissions. The five 
air districts whose Title V programs we are proposing to revise took 
differing approaches to revising their Title V regulations to address 
the Tailoring Rule's Title V requirements, depending on the structure 
and content of their rules. In section III.B., we explain how the 
districts' revised Title V regulations satisfy the new Title V GHG 
criteria.

C. What is the federal approval process for revisions to a Part 70 
operating permits program?

    In order for state regulations to be approved as part of the 
federally-enforceable Title V operating permits program, states must 
formally adopt regulations consistent with state and Federal 
requirements. This process generally includes a public notice, public 
hearing, public comment period, and a formal adoption by a state-
authorized rulemaking body.
    Once a state rule, regulation, or control strategy is adopted, the 
state submits it to us for inclusion into its approved operating 
permits program. We must provide public notice and seek additional 
public comment regarding the proposed Federal action on the state 
submission. If adverse comments are received, they must be addressed 
prior to any final Federal action by us.
    All state regulations and supporting information approved by EPA 
under section 502 of the CAA, including revisions to the state program, 
are included in the Federally-approved operating permits program. 
Records of such actions are maintained in the CFR at Title 40, part 70, 
appendix A, entitled ``Approval Status of State and Local Operating 
Permits Programs.''

III. EPA's Evaluation and Action

A. How is EPA evaluating the rules?

    The relevant statutory provisions for our review of the submitted 
rules include 40 CFR Part 70, as amended by the June 3, 2010 Tailoring 
Rule.

B. Do the rules meet the evaluation criteria?

    We have reviewed the five districts' revised Title V rules in 
accordance with the rule evaluation criteria described above. A 
discussion for each District is provided below. EPA is proposing to 
find that each district's submittal correctly implements the changes in 
Title V applicability required by the Tailoring Rule.

[[Page 16511]]

    MBUAPCD revised Rule 218 (Title V: Federal Operating Permits) to 
satisfy the Tailoring Rule requirements. The District revised the 
definition of ``Major Source'' in section 2.18.5 of the rule to include 
sources that, as of July 1, 2010, emit or have the potential to emit 
``100,000 tpy or more of carbon dioxide equivalent (CO2e) greenhouse 
gas emissions and directly emit, or have the potential to emit, 100 
tons per year (tpy) or more of any greenhouse gas,'' as required by the 
Tailoring Rule. The District also revised Section 1.3 of the rule to 
exempt sources that limit their PTE of GHG emissions to less than 
100,000 tpy of CO2e greenhouse gas emissions, and to exclude greenhouse 
gases from the exemption for sources that limit their PTE to less than 
100 tpy of any air pollutant. The District added new definitions for 
``Greenhouse Gases'' and ``Carbon Dioxide Equivalent Emissions''. 
Instead of using a cross-reference to 40 CFR 86.1818-12(a), as EPA does 
in the Tailoring Rule, MBUAPCD has provided a specific definition of 
Greenhouse Gases in its rule, which is consistent with the EPA 
definition. The District's definition of ``Carbon Dioxide Equivalent 
Emissions'' incorporates the Global Warming Potential values that EPA 
lists in Table A-1 to Subpart A of 40 CFR Part 98, EPA's Mandatory 
Greenhouse Gas Reporting regulation. All of these changes, which are 
the only changes that the District made to Rule 218, are consistent 
with the requirements of the Tailoring Rule. We note that the 
applicability date of July 1, 2010 is one year earlier than required by 
the Tailoring Rule. This had no practical effect in the District 
because there are no sources newly subject to Title V based solely on 
being classified a major source for GHG emissions.
    SLOAPCD added a new provision to the Applicability section of Rule 
216 (Federal Part 70 Permits). The new provision, in paragraph 
216.B.2., requires sources that emit GHG in amounts ``equal to or 
exceeding the thresholds specified in 40 CFR 70.2 in effect August 2, 
2010'' to apply for a title V permit. The District also added a new 
provision to the definition of ``Air Pollutant.'' The new provision, in 
paragraph 216.C.4.f., adds ``Greenhouse gases that are `subject to 
regulation' as defined in 40 CFR 70.2 in effect August 2, 2010'' to the 
list of the air pollutants defined in the rule. These cross-references 
to 40 CFR 70.2 means that the District's approach to tailoring the 
applicability of its Title V program for GHG sources is identical to 
EPA's. We are proposing to approve these revisions to SLOAPCD's title V 
program because they are consistent with EPA's approach to Title V 
applicability for GHG sources in the Tailoring Rule.
    SBCAPCD revised Rule 1301 (General Information), which is one of 
five rules that comprise the District's Regulation XIII (Part 70 
Operating Permit Program), by adding a cross-reference to 40 CFR 70.2. 
Specifically, the District amended the definition of ``Part 70 Source'' 
in section 1301.C. by adding a new provision that makes sources with 
the potential to emit ``greenhouse gases that are `subject to 
regulation' as defined in 40 CFR 70.2 in effect August 2, 2010'' 
subject to Title V. This cross-reference to the 40 CFR 70.2 definition 
of ``subject to regulation'' means that the District's approach to 
tailoring the applicability of its Title V program to GHG sources is 
identical to EPA's, and therefore approvable.
    In addition to the GHG-related rule changes adopted on January 20, 
2011, SBCAPCD had previously revised the definition of ``stationary 
source'' in Rule 1301 to reduce the area in which marine vessels 
associated with a stationary source must account for their emissions. 
Rule 1301 now limits the geographic area of emissions liability to 
``California Coastal Waters'' (as defined in Rule 1301) adjacent to the 
District, and excludes areas adjacent to the neighboring counties of 
San Luis Obispo and Ventura. We are proposing to approve this change, 
which is consistent with the District's jurisdiction in Santa Barbara 
County.
    SCAQMD addressed the Tailoring Rule requirements by revising six of 
the seven rules that comprise Regulation XXX (Title V Permits). 
Specifically, SCAQMD revised Rule 3000 (General) to add definitions of 
``Carbon Dioxide Equivalent'', ``Global Warming Potential'', and 
``Greenhouse Gas.'' SCAQMD also revised Rule 3001 (Applicability) to 
require that any facility that, as of July 1, 2011, has the potential 
to emit 100,000 tpy or more of GHG on a CO2e basis and a 
potential to emit more than 100 tpy of any GHG on a mass basis apply 
for a Title V permit within 180 days. SCAQMD provided a specific 
definition of GHG in Rule 3000 which is consistent with the EPA 
definition. The District's definition of ``CO2 equivalent'' 
is based on the same Global Warming Potential values that EPA lists in 
Table A-1 to Subpart A of 40 CFR Part 98, EPA's Mandatory Greenhouse 
Gas Reporting regulation. SCAQMD's definition of ``Global Warming 
Potential'' uses the same language as EPA's definition in 40 CFR 
Section 98.6. Finally, SCAQMD revised Rule 3003 (Applications), Rule 
3005 (Permit Revisions), and Rule 3006 (Public Participation), to make 
the cross references to Rule 3000 within those rules consistent with 
the revised numbering sequence in that rule. Since the District's Title 
V program changes are consistent with EPA's approach to Title V in the 
Tailoring Rule, we are proposing to approve them as a revision to 
SCAQMD's Title V program.
    VCAPCD addressed the applicability of title V permitting for major 
GHG sources by revising the applicability provisions of Rule 33 (Part 
70 Permits--General). Specifically, the District revised subsection 
33.B.1., which requires stationary sources with a PTE of 100 tpy or 
more of any regulated air pollutant to obtain a title V permit. VCAPCD 
added language to this provision to make it applicable to sources that 
emit greenhouse gases, effective July 1, 2011, if a source also has a 
PTE of 100,000 tons per year or more on a CO2 equivalent 
basis.
    In addition the District added a new definition of ``CO2 
Equivalent (CO2e)'' to Rule 33.1 (Part 70 Permits--
Definitions) that is based on EPA's definition of ``tpy CO2 
equivalent emissions'' in 40 CFR 70.2, and refers to the Global Warming 
Potentials that appear in Table 1 of Rule 2 (Definitions). (Rule 2 has 
been submitted to EPA for approval into the Ventura County portion of 
the California State Implementation Plan. We will take action on that 
rule in a separate rulemaking.) We are approving the District's 
definition because, while it is not identical to the 70.2 definition, 
it is sufficiently similar to, and fully consistent with, our 
definition. The District also revised two definitions in Rule 33.1. The 
definition of ``regulated air pollutant'' now includes greenhouse gases 
if the source has a potential to emit of 100,000 tons per year or more 
CO2 equivalent emissions. The definition of ``Insignificant 
Activity'' now excludes greenhouse gases from the emission level of 2 
tpy of any regulated pollutant that otherwise qualifies an activity as 
insignificant.
    VCAPCD also made one revision that is unrelated to GHG. The 
District revised the definition of ``Federally-Enforceable 
Requirement'' in Rule 33.1. The District added language to Subparagraph 
33.1.12.a, which lists Title I requirements of the CAA that are 
federally enforceable, to clarify that federally enforceable Title I 
requirements are ``not limited to'' the requirements listed in the 
definition. The additional language ensures that the definition 
includes other Title I requirements that may be promulgated by the EPA 
Administrator in the future.

[[Page 16512]]

    We are proposing to approve the Title V program revisions submitted 
by VCAPCD because the GHG provisions of the revised rules are 
consistent with EPA's approach to Title V in the Tailoring Rule, and 
the revision to the definition of ``Federally-Enforceable Requirement'' 
clarifies the definition and is consistent with EPA's definition of 
``applicable requirement'' in 40 CFR 70.2.

C. Public Comment and Proposed Action

    EPA believes the submitted rules fulfill all of the Tailoring 
Rule's Title V requirements; therefore we are proposing to approve 
these rule changes, adopted in 2010 and 2011, as revisions to the Title 
V programs of all five districts. We will accept comments from the 
public on this proposal for the next 30 days. Unless we receive 
convincing new information during the comment period, we intend to 
publish a final approval action.

IV. Statutory and Executive Order Reviews

    Today's proposed action merely proposes to approve State law as 
meeting Federal requirements and does not impose additional 
requirements beyond those imposed by State law. For that reason, this 
proposed action:
     Is not a ``significant regulatory action'' subject to 
review by the Office of Management and Budget under Executive Order 
12866 (58 FR 51735, October 4, 1993);
     Does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or 
uniquely affect small governments, as described in the Unfunded 
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have Federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
     Is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the 
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 
note) because application of those requirements would be inconsistent 
with the Clean Air Act; and
     Does not provide EPA with the discretionary authority to 
address disproportionate human health or environmental effects with 
practical, appropriate, and legally permissible methods under Executive 
Order 12898 (59 FR 7629, February 16, 1994).
    In addition, this proposed action does not have tribal implications 
as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), 
because the action is not approved to apply in Indian country located 
in the State, and EPA notes that it will not impose substantial direct 
costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 70

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Carbon dioxide, Carbon dioxide equivalents, 
Greenhouse gases, Hydrofluorocarbons, Intergovernmental relations, 
Methane, Nitrous oxide, Perfluorocarbons, Reporting and recordkeeping 
requirements, Sulfur hexafluoride, Incorporation by Reference.

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

    Dated: March 8, 2012.
Jared Blumenfeld,
Regional Administrator, Region IX.
[FR Doc. 2012-6676 Filed 3-20-12; 8:45 am]
BILLING CODE 6560-50-P
```