# Review of New Sources and Modifications in

Indian Country

- Amendments

Response to Comments(This page intentionally left blank.)

# Review of New Sources and Modifications in

Indian Country

- Amendments

Response to Comments

New Source Review Group Air Quality Policy Division Office of Air Quality Policy and Standards U. S. Environmental Protection Agency

Research Triangle Park, NC 27711

April 2014(This page intentionally left blank.)Review of New Sources and Modifications in Indian Country

- Amendments Response to Comments

i 

## TABLE OF CONTENTS

LIST OF ACRONYMS AND ABBREVIATIONS

................................ ................................ ...... iii

LIST OF UNITS

................................ ................................ ................................ ............................ iii

1 INTRODUCTION

................................ ................................ ................................ ................... 1

1.1 Background

................................ ................................ ................................ .................... 1

1.2 The Commenters

................................ ................................ ................................ ............ 1

2 Summarized Comments on the Proposed Amendments and Responses

................................ . 3

2.1 Minor NSR Rule Overview

................................ ................................ ............................ 3

2.2 Units/activities Exempted from Permitting

................................ ................................ .... 3

2.2.1 Exemption for Emergency Generators

................................ ............................... 4

2.2.2 Exemption for Boilers and Furnaces

................................ ................................ .. 6

2.2.3 Proposed exemption for Forestry/Silvicultural Activities

................................ .. 7

2.3 Suggestions for Other Exemptions

................................ ................................ ................. 8

2.3.1 Other Categories Proposed for Exemption

................................ ........................ 9

2.4 Construction Related Terms

................................ ................................ ......................... 10

2.4.1 General Comments on Construction Terms

................................ ..................... 10

2.4.2 Definition of Begin Construction

................................ ................................ ..... 10

2.4.3 Definition of Commence Construction

................................ ............................ 10

2.5 Source Relocation

................................ ................................ ................................ ......... 11

2.5.1 30

- Day Advance Notification Provision

................................ .......................... 11

2.5.2 Permitting Issues related to Source Relocation

................................ ................ 12

2.6 Other Comments on Permitting

................................ ................................ .................... 14

2.7 Miscellaneous Comments

................................ ................................ ............................. 15

2.7.1 Rulemaking Process

................................ ................................ ......................... 15

2.7.2 Ge neral Permits

................................ ................................ ................................ 15

2.7.3 Environmental Appeals Board

................................ ................................ ......... 16Review of New Sources and Modifications in Indian Country

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ii (This page intentionally left blank.)Review of New Sources and Modifications in Indian Country

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## LIST OF ACRONYMS AND ABBREVIATIONS

Act Clean Air Act (42 U.S.C. 7401

- 7671q)

BACT Best a vailable c ontrol t echnology

CAA Clean Air Act (42 U.S.C. 7401

- 7671q)

CFR Code of Federal Regulations

CO Carbon m onoxide

EAB Environmental Appeals Board

EPA U. S. Environmental Protection Agency

FARR Federal Air Rule for Indian Reservations

FBIR Fort Berthold Indian Reservation

FIP Federal Implementation Plan

FR Federal Register

NAAQS National Ambient Air Quality Standards

NO

x Nitrogen o xides

NSPS New Source Performance Standard

NSR New Source Review

PSD Prevention of Significant Deterioration

PTE Potential t o e mit

SCAQMD South Coast Air Quality Management District

SIP State Implementation Plan

U.S.C. United States Code



## LIST OF UNITS

ppm Parts per million

tpy Tons per yearReview of New Sources and Modifications in Indian Country

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## 1 INTRODUCTION

1.1 Background

On July 1, 2011 , the U. S. Envi r o nmental Protection Agency (EPA or we ) finalized a rulemaking titled Review of New Sources and Modifications in Indian Country , which create d a Federal Implementation Plan (FIP) for Indian c ountry. 1 The FIP include d two basic air quality regulations for the protection of communities in Indian country. The two rules are elements of

the Ne w Source Review (NSR) program. The first rule applies to minor stationary sources (minor sources) and minor modifications at major s tationary sources (major sources) in Indian country ( Indian country minor NSR rul e). The second rule applies to all new major sources and major modifications located in areas of Indian country that are designated as not attaining the National Ambient Air Q uality Standards (NAAQS) ( nonattainment major NSR rule). On June 4, 2013, proposed amendments to the first rule were published in the Federal Register . T he minor

NSR rule is hereinafter referred to as the “ Indian country minor NSR rule ” 2

.

We proposed t he following amendments:

1) To reconsider the 30 day advance notification provision for true minor sources that

relocate.

2) To add seven activities/categories to the list exempt from permitting.

3) To clarify terms related to the construction of a n ew source/emissions unit and related permitting requirements by adding definitions for “ commence construction ” and “ begin

construction

. ”

We intend that these changes will make the Indian country minor NSR rule clearer and

easier to i mplement for reviewing authoritie s and sources within Indian country. Th is document presents a summary of the public comments on the proposed amendments , along with our responses to those comments. The document supports the final rule amendments for the Indian

country minor NSR rule

.



### 1.2 The Commenters

The public comment period end ed on August 4, 2013. W e received seven sets of

comments on the proposed amendments. The commenters can be broken down by general type

as follows: 3 tribal and tribal association commenters, 1 s tate/local air agency
, 2 industry and industry association commenters and 1 private citizen. The comment er s are listed in Table 1

below.

1 The FIP was published in the Federal Register , Volume 76, beginning on page 38,748 (76 FR 38748).

2 See 78 FR 33266.Review of New Sources and Modifications in Indian Country

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Response to Comments

2 Table 1. List of Commenters

DOCKET ID

a COMMENT DESCRIPTION TYPE OF

COMMENTER

0 178 Comment submitted by L uke Martone Pri vate Citizen

0180 Comment submitted by James M. Olguin, Vice

Chairman, Southern Ute Indian Tribal Council Tribe

0 18 1 Comment submitted by Barbara Baird

, Chief Deputy

Counsel , South Coast Air Quality Management District State/ L ocal Air Agency

0 182 Comment submitted by Matthew Todd, Senior Policy

Advisor, American Petroleum Institute Industry

Association

0183 Comment submitted by Stephen B. Etsitty, Executive

Director, Navajo Nation Environmental Protection Agency Tribe

0 184 Comment submitted by Julie Simpson

, Air Quality

Program Manager, Nez Perce Tribe Tribe

0 186 Comment submitted by Jennifer Biever

, on behalf of

Cameron Cuch, V.P. of Government Affairs, Crescent Point Energy Industry

01 87 Summary of 9/5/13 call between the South Coast Air

Quality Management District and EPA on proposed exemptions State/Local Air Agency

01 88 Summary of 10/23/13 teleconference between API and

the EPA on source relocation Industry

Association

a Docket ID identifies comment er s found in Docket No. EPA

- HQ

- OAR

- 2003

- 0076 by document

number.Review of New Sources and Modifications in Indian Country

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3 

## 2 Summarized Comments on the Proposed Amendments

and Responses

2.1 Minor NSR Rule Overview

The Indian country minor NSR rule applies to new and modified minor sources and to minor modifications at major sources. New minor sources with a PTE equal to or greater than the minor NSR thresholds, or modifications at existing minor sources with allowable emissions increases equal to o r greater than the minor NSR thresholds, must apply for and obtain a minor NSR permit prior to beginning construction of the new source or modification.

The effective date of the Indian country minor NSR rule was August 30, 2011. To

facilitate the effec tive implementation of the Tribal minor NSR program, some components of the rule were phased in. Generally, the applicability of the preconstruction permitting rules to new synthetic minor sources 3 began on the rule’s effective date, August 30, 2011; for n ew or modified true minor sources 4

, the rules generally apply beginning September 2, 2014. In addition, existing true minor sources were required to register with their reviewing authority by March 1, 2013.



### 2.2 Units/activities Exempted from Permitting

Comm ent :

One private citizen (0178) supports the proposed exemption s for units and activities that are exempted under the Federal Air Rule for Indian Reservations ( FARR ) 5 as well as proposed exemptions for other classifications. One tribal commenter (0180) s upports the changes as they appear to reduce regulatory burden for minor sources without significantly reducing environmental protection

.

Response:

We appreciate the support for the proposed exemptions. We have made some revisions to

the proposed exemption categories as di scussed below.

3 40 CFR 49.152 defines “synthetic minor source” as a source t hat otherwise has the potential to emit regulated NSR pollutants in amounts that a re at or above those for major sources in section 49.167, section 52.21 or

section 71.2 of chapter 40, as applicable, but that has taken a restriction s o that its PTE is less than such amounts for major sources. Such restri ctions must be enforceable as a practical matter.

4 40 CFR 49.152 defines “ true minor source ” a s a source, not including the exempt emissions units and

ac tivities listed in section 49.153(c), that emi ts or has the potential to emit regu lated NSR pollutants in amounts that are less than the major source thresholds in section 49.167 or section 52.21 of C hapter 40

, as applicable, but equal to

or greater than t he m inor NSR thresholds in section 49.1 53, without the need to take an enforc eable restriction to

reduce its PTE to such levels.

5 The FARR is a FIP that applies to air pollution sources on Indian reservations in Idaho, Oregon and Washington.Review of New Sources and Modifications in Indian Country

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Response to Comments

4 Comment :

One state/local commenter (0181) appreciates that additional exemptions may be needed,

however they expressed an overall concern (that applies broadly to several of the exemption categories proposed) that the exemptions are inconsistent with their region’s air quality rules

. The commenter believes that exempting these sources from permitting will provide a competitive advantage to sources in Indian country compared t o sources on non

- Tribal lands.

Th e commenter cites a specific concern with the competitive advantage issue in light of

the EPA’s recent proposed "detachment" of Morongo Indian country from California’s South

Coast Air Basin and the lowering of the classification of the Morongo reservation from E xtreme

to Serious ozone nonattainment ( Note : the proposed reclassification identified by the commenter was finalized on September 2 3

, 2013 ( 78 FR 58189 ). The commenter states that the Morongo lands are located directly upwind from the Coachella Vall ey, a S evere ozone nonattainment area,

and therefore t he commenter is concerned that exempting certain sources from permitting in Indian country will result in negative air quality impacts thereby delaying attainment of the NAAQS in downwind airsheds for b oth non

- tribal lands and certain tribal areas.

T he commenter urges EPA to adopt requirements specifically for areas of Indian country

that are classified as either S evere or E xtreme ozone nonattainment areas, just as the EPA has adopted lower minor NSR emission thresholds in the existing rule for nonattainment areas as opposed to attainment areas.

Response:

Prior to the August 30, 2011 effective date of the Indian country minor NSR rule , codified in 40 CFR, part 49

, promul g ated July 1, 2011 (76 FR 38748), there were no emission reduction requirements for new minor sources within areas of Indian country such as the Morongo

Reservation

. We point this out to highlight that the Indian country minor NSR rule has already

reduced any p otential competiti ve advantage cited by the commenter by requiring pre

construction permits on sources (with emissions above permitting thresholds ) where prior to August 30, 2011

, there were no such requirements

.

As discussed in the July 1, 2011 fina l rule, while section 182(e)(2) of the Act specifies a n emissions increase threshold of “0” tons/year ( tpy ) for existing major sources in E xtreme ozone nonattainment areas, we do not believe these thresholds a re appropriate for minor sources and

operators withi n Indian country. Nonetheless, we are mindful of the need to pro tect the NAAQS
and, as discussed in comment response s related to exemptions for emergency generators and boilers/furnaces in sections 2.2.1 and 2.2.2 of this document, respectively

, we ha ve made some revisions to the exemption criteria in the final rule amendments.



### 2.2.1 E xemption for Emergency Generators

Comments:Review of New Sources and Modifications in Indian Country

- Amendments Response to Comments

5 One private citizen ( 0179 ) recommends that EPA maint ain the exemption sizes of 500

hors epower (HP) maximum manufacturer s ite

- rated HP in nonattainment areas , and 1,000 HP in

attainment areas for residential and healthcare rel ated purposes only, but lower the exemption

sizes to 400 HP and 800 HP for non

- residential and non

- healthcare related purposes

, respectively

. The commen ter did not provide any additional details regarding this

recommendation

.

Response:

Since the commenter did not provide any rationale for lower ing the exemption sizes for

emergency generators used for non

- residential or non

- healthcare related purposes

, we were unable to evaluate the details of this recommendation. Therefore, n o changes were made in response to this comment.

Comment:

One tribal commenter ( 0183 ) supports the emergency generator exemption . The

commenter notes that the emissions at the proposed sizes are well below the minor source

emissions thresholds and states that exempting the identified units from permitting will save resources by eliminating the need for applicants and permitting agencies to calculate potential to

emit

.

Resp onse:

We appreciate support for the proposed exemption.

Comment:

One state/local commenter (0181) expressed concern with the proposed exemption

threshold for emergency generators under 500 horsepower ( HP ) in nonattainment areas and

asserted it would cr eate an imbalance between tribal lands and the surrounding non

- tribal areas classified as Severe or Extreme nonattainment for ozone

. Air quality regulations that apply to

sources within the commenter’s jurisdiction specify emission limits for NOx and parti culate matter ( PM ) for all engines over 50 HP. The commenter believes engines on tribal lands, which

would be exempt from permitting under the EPA’s proposed criteria

, would emit NOx in

amounts above the 0.8 tpy and 1.8 tpy levels that new and older model engines, respectively,

must meet under the state air district’s Best Available Control Technology ( BACT ) requirements. The commenter states that these types of engines are controllable and contribute to

ozone and therefore should be su bject to NSR permitting

.

The commenter also cited a report from the World Health Organization 6 that declared diesel PM to be a human carcinog en. The commenter states that emissions from three standby generators (approximately 900 HP in total) can create cancer risks exceeding 25 in a million,

6 Press rele ase dated June 12, 2012. See: www.iarc.fr/en/media

- centre/pr/2012/pdfs/pr213_E.pdf

.Review of New Sources and Modifications in Indian Country

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6 even if operated only 50 hours/year. The commenter elaborates that a 500 HP emergency generator , operating for 500 h ou rs/y ea r, would create even higher risk (than the engines totaling

900 HP in the earlier example ) due to its longer operating period, and therefore PM should be

controlled from these units and they should be subjec t to NSR since the EPA's source

- spec ific

rules are not applicable to these units

.

Response:

O ne of our objectives for proposing activities/units for exemption was to reduce burden

on source owners. We believe that emergency generators with horsepower ratings below the exemption sizes will predominately have emissions below the minor source permi tting thresholds

and therefore the pr oposed exemption would potentially save source owners the effort of estimating their emissions solely to demonstrate that emissions are well below the permitting

threshold.

However

, we also recognize the commenter’s concern s regarding the impacts of sources to portio ns of the South Coast Air Basin that are classified S evere or E xtreme for ozone

. We are required by title I of the Act to ensure attainment and maintenance of the NAAQS. Accordingly, after considering the comment, we believe that an ex emption for emergency generators is not appropriate in ozone nonattainment areas classified Severe or Extreme , and we have revised exemption language in the fin al rule accordingly

. As finalized , the total site

- rated 500 HP exemption for emergency generator s in ozone nonattainment areas will only apply in ozone nonattainment areas classified Serious or lower . The site

- rated 1,000 HP exemption proposed for attainment areas remains unchanged in this final rule

.



### 2.2.2 Exemption for Boilers and Furnaces

Comment :

One tribal commenter (0183) supports the proposed exemption category for boilers and

furnaces

, but is not sure any such units are located on their tribal lands. The commenter believes the exemptions are reasonable and will save resources by eliminating the need for applicants and permitting agencies to calculate PTE.

Response:

We appreciate support for the proposed exemption.

Comment :

One state/local commenter (0181) believes that boilers and/or furnaces below the proposed heat input rates should not be exempt from minor NSR permitting in ozone nonattainment areas classified as Severe or higher because it would provide a competitive advance to sources locating in Indian country. The commenter explains that the SCAQMD air quality rules requir e controls for NOx at levels below the proposed exemption rates of 5 million

Btu/hr for nonattainment areas ; 1 0 million Btu/hr for attainment areas . The commenter refers toReview of New Sources and Modifications in Indian Country

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7 the SCAQMD’s NOx emission limits of 9 ppm for natural gas boilers having heat rates between

2 million Btu/hr and 5 million Btu/hr to be met by January 1, 2012

. In addition to that requirement, natural gas industrial furnaces must meet a n emissions limit of 30 ppm (Rule 1147)

and NOx controls for fan

- type central furnaces under 175,000 Btu/hr are required as well ( R ule 1111). The commenter states that the permitting exemption under Rule 219(b ) ( 2) applies only t o boilers and furnaces under 2 million Btu/hr

.

Response:

We bel ieve t he commenter raises a valid concern regarding the potential impacts to porti ons of the South Coast Air Basin classified as S evere or E xtreme o zone nonattainment areas

that are a djacent to/

downwind from Indian country . In certain cases the proposed exemption could make it more difficult for downwind non

- Indian country areas to achieve attainment of the NAAQS , which would be contrary to the requirements of title I of the Act . To minimize the likelihood of this occurring in the areas with higher ozone nonattainment classifications, we are finalizing a lower heat input rate ( than the proposed 5 million Btu/hr which would have app lied in all nonattainment areas) for S evere and E xtreme ozone nonattainme nt areas. The heat input

rate exemption for nonattainment areas in the final rule is specified as follows: for nonattainment areas classified S erious and lower , the exemption rate is heat input rates at or
below 5 million Btu/hr; for ozone nonattainment areas classified as S evere or E xtreme

, the

exe mption level is a heat input rate at or below 2 million Btu/hr . The heat input rate exemption proposed for attainment areas remains unchanged

.



### 2.2.3 Proposed exemption for Forestry/Silvicultural Activities

Comment:

One tribal commenter (0183) supports this proposed exemption. The commenter states

the view that emissions from road construction and maintenance are of particular concern (note: while the commenter didn’t specify, we assume the comment is referring to activities related to

the proposed exemption category), “ such emissions do not rise to a level requiring their removal from the list of proposed exemptions. ” The commenter further states that permitting requirements for road construction and maintenance will impact timely repair and maintena nce of ro ads on the commenter’s lands. The commenter also mentions that open burning , a potential source of emissions on their lands, is regulated b y the Bureau of Indian Affairs. T herefore the

commenter believes the proposed exemption for forestry and silvicultura l activities is reasonable and will save permitting resources.

One state/local commenter (0181) requests that the proposed exemption category be

modified or deleted

. The commenter voices concern with significant emissions from road

construction and maint e nance, and logging activities. The commenter also expresses concern with the potential for multiple pieces of equipment to collectively exceed the minor source

thresholds , such as engines associated with wood chippers , a consideration EPA noted in

identif ying units/activities to propose for exemption (78 FR 33270) . The commenter urges the

EPA to delete the proposed exemption and instead rely on the attainment and nonattainmentReview of New Sources and Modifications in Indian Country

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Response to Comments

8 NOx thresholds (10 tpy and 5 tpy, respectively) to determine when a permit must be obtained . As an alternative, the commenter suggest s that specific types of equipment could be exempted instead of the entire category if the EPA determines them to have de minimis emissions.

Response:

One reason we proposed the forestry/silvicultural category for exemption was to be

consistent with the exemptions list in the FARR , which applies in Indian country in the

Northwest

. A second reason we proposed this category for exemption was that we believed all emissions within the category would be de minimis in nature

. T herefore

, subject ing them to NSR permitting would provide little environmental benefit. Both commenters express some concern with the emissions associated with forestry and silvicultural activities, and one commenter identifies a situation where emissions could exceed de minimis levels

.

Upon considering available information, we have concluded that a category

- wide exemption is not the most appropriate approach to managing emissions for forestry and

silvicultural activities. This conclusion is based on our recognizing the broad range of activities and potential emissions sources that could be part of this category and the potential to inadvertently exclud e units with significant emissions

. Due to the broad nature of activities und er this category, we believe that there might be cases where permitting of certain emi ssion units is needed to protect air quality , which would be precluded under a category wide exemption

. Based

on that concern, we believe it is more appropriate to use th e emission thresholds in the existing

rule (e.g., NOx: 10 tpy and 5 tpy in attainment and nonattainment areas respectively ) to determine source permitting requirements and not have a broad, category

- wide exemption. Therefore the exemption for forest ry and silvicultural activities is not included in the final

amendments

.



### 2.3 Recommendations for Other Exemptions

Comment:

One industry commenter ( 0186 ) states that it operate s methanol and glycol storage tanks below 250 gallons in Tri bal airsheds. The commenter believes that given the small sizes of these

tanks they should be added to the lis t of exempted emissions

. The commenter states that emissions from these units are insignificant and that similar units, often in much greater sizes,

are consid ered insignificant for Title V purposes

Response:

We agree with th e commenter that emissions from such tanks are of a de minimis level.
However, we chose exemption categories based on more than that single criterion. In this case, we believe that the types of tanks cited by the commenter would be found, generally, in the following situations: 1) the tank is located at a well, with no other equipment present besides the necessary piping, valves and controlle rs at the well , and the minor source permitting thresholds

would be sufficient exclude a tank at this location from permitting; or 2) the tank is located with several other pieces of equipment (e.g., glycol storage tank with a glycol dehydrator and aReview of New Sources and Modifications in Indian Country

- Amendments Response to Comments

9 conde nsate tank) that collectively exceed the minor source permitting threshold, and must obtain a permit prior to construction. Due to the different facility configurations where these tanks

could be found

, we believe the minor source permitting thresholds are the appropriate way to

decide permit requirements

. For this reason w e have not added these units to the exemption list as suggested by the commenter.

Comment:

One industry association commenter ( 0182 ) states that many member companies operate
facilit ies with one significant emissions source

, such as a compressor

, that is accompanied by

other insignificant auxiliary equipment

, such as a tank or heater

. The commenter recommends

that the EPA consider an additional exemption based on a general PTE thresho ld for the insignificant auxiliary equipment at such a location . The commenter believes this would alleviate the equipment database maintenance and reporting requirements for these activities. The commenter believes this exemption would be consistent with the EPA’s goal to limit permitting burden for minor emitting units expected to be very common.

Response:

The commenter is suggesting that we exempt certain emission units from permitting at a facility whose potential emissions have been shown to exceed the minor source permitting

thresholds. T

he minor source permitting threshold s in the Indian country minor NSR rule were developed to identify those facilities that should be subject to permitting for the purposes of attaining or maintaining the NAAQS, as required by Section 110(a)(2)(C) of the Act . Once a facility’s PTE has been evaluated and found to exceed the minor NSR thresholds the source is required to obtain a permit. At that point

, we believe the determination of emission control requirements, reco rdkeeping and reporting should be made by the reviewing authority on a case

by

- case b asis. Also insignificant activities could also be exempted. We do not believe that applying an individual emissions unit PTE exemption is appropriate for those cases

.



### 2.3.1 Other Categories Proposed for Exemption

Comment :

One tribal commenter (0183) supported the proposed exe mptions for engines below 50
HP; single family r esidences/residential dwellings; air condition units used for comfort ; and cooking of food. The commen ter believes that permitting of these sources would be unnecessarily burdensome for applicants and permitting agencies.

Response:

We appreciate support for the four exemption categories cited by the commenter. We have finalized these exemptions as proposed

.Review of New Sources and Modifications in Indian Country

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10 

### 2.4 Construction Related Terms

2.4.1 General Comments on Construction Terms

Comment :

One tribal commenter (0183) supports the proposed clarifications for “ commence construction ” and “ begin construction ” and believes that using different terms for the distinct permittin g milestones provides clarity. The commenter also supports the specific definitions proposed and finds it helpful that they specify activities that are all owed before a permit has been

issu ed

.

Response:

W e appreciate support for the proposed clarifications.



### 2.4.2 Definition of Begin Construction

Comment :

One industry association commenter (0182) notes that the proposed definition of "begin

construction" lists certain activities that can be conducted before t he source has obtained a permit 7 . The commenter states that the list is more restrictive than the Agency's long standing approach to permissible activities. The commenter refers to a policy memo a ddressing activities

allowed without a permit 8 and states t hat the EPA should not deviate from previously established policies.

Response:

We agree with the commenter . Our intent was to include the same list of activities in the

propose d definition that have been historically allowed under EPA policy prior to obtaining a permit

. We inadvertently omitted the term "grading" from the list in the proposed definition

. We

have added grading to the activities allowed under the definition of “begin construction” in the final rule to maintain consistency with existing EPA policy

.



### 2.4.3 Definition of Commence Construction

7 The list we proposed includes the following activities: engineering and design planning, geotechnical investigation (surface and subsurface explorations), clearing, sur veying, ordering of equipment and materials, storing of equipment or setting up temporary trailers to house construction management or staff and contractor personnel.

8 Memorandum from Reich, Edward E., OAQPS, to DeSpain, Robert R., EPA Region VII, titled Construction Activities Prior to Issuance of a PSD Permit with Respect to “Begin Actual Construction,” March 28,
1986,Review of New Sources and Modifications in Indian Country

- Amendments Response to Comments

11 Comment:

One industry association commenter (0182) refers to the recently promulgated FIP for the

Fort Berthold Indian Reservation (FBIR) and notes that under that rule

, construction begins on the date on which well completion operations are initiated (78 FR 17836). The commenter requests that the definit ion from the FBIR FIP also be used in the Indian country minor NSR rule for facilities in the oil and gas exploration a nd production sector.

Response:

The FBIR FIP cited by the commenter does not address preconstruction permitting requirements. Instead, it specifies emission reduction measures for oil and gas production

activities within the FBIR. The well completion milestone under the FBIR FIP establishes the

date when emission controls must be in operation , it does not identify or establish a deadline for permitting . By contrast, the Indian country minor NSR rule is a preconstruction program

. It would not be approp riate to use the same definition in both rules since they serve different purposes. No changes related to this comment were made to the definition of commence construction in the final rule

.



### 2.5 Source Relocation

2.5.1 30

- Day Advance Notification Provision

Comment :

One tribal commenter (0183) believes that at least 30 days notice is warranted for

relocation of a non

- portable source since a new permit may be required

, and in that case, the permitting authority (i.e., reviewing authority) will need sufficient time t o process the application and issue a permit. The commenter elaborates that for a portable source

, a 10

- day notice requirement may be sufficient since its permit will likely include pre

- approved new location s

. The commenter agrees with the EPA's interpretation that the se time periods apply where an

entire source is relocated

, noting that relocation of one or more pieces of equipment or emission units requires consultation with the source's reviewing authority to determine if a modification

will oc cur under the federal Indian country minor NSR rule

.

Another tribal commenter (0184) believes that, based on their permitting experience

, in situations where a registered source relocat es to a new, previously un approved location, the permitting authority should have at least 30 days to review the relocation request

. The

commenter states that t his time period is needed for tribal and historic preservation office reviews to be performed.

One industry association commenter (0182) reiterates comments made i n its petition for reconsideration on the July 1, 2011

, final federal Indian country minor NSR rule stating that sources often relocate on short notice and occasionally change a previously planned relocation

with little advance warning . The commenter state s that the 30

- day advance notice requirement is incompatible with oil and gas sector operations. In a subsequent teleconference, the commenterReview of New Sources and Modifications in Indian Country

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Response to Comments

12 clarified that their primary concern involves relocation of one or more pieces of equipment or

emissions units an d not entire sources. 9 In response to the EPA’s request for comment on the

notific ation provision, the commenter agrees with the EPA’s statement that there is no requirement for advance approval

, or a permit

, for a registered source that relocates prior to September 2, 2014. The commenter suggests that, in those cases, there is no need or value to an advance notification as long as the source continues to comply with its permit. The commenter

elaborates that t here will be sufficient opportunity after relocation to notify the EPA of any change. The commenter offers that one possible approach is the one used under 40 CFR 63.9(j),

and could be adopted in the Tribal rule 10 . The commenter also references the recently promulgated oil and gas sector NSPS which allows for a lag time between source start

- up and the determination of whether controls are required

.

Response:

We specifically requested comment on the case where the source relocates before September 2, 2014 (i.e., where no permit is required). As we discussed in the preamble for the proposed amendments (78 FR 33723), a true minor source that relocates in that sit uation does

no t need prior approval from its reviewing authority

. . The notification provision simply specifies

advance notification in that case. However, i t was not clear in some tribal comment s if the y were addressing the situation where relocation occu rs before September 2 , 2014

, or on or after that

date , since the need for a permit was mentioned by commenters

. For that latter case, a s stated in the proposal, a previously unpermitted portable source (e.g., a hot

- mix asphalt plant) that

relocates on or after September 2, 2014

, will be required to obtain a permit prior to relocation

, and we believe that any such permit will contain p rovisions addressing any future relocation. In

th i s case of relocation on/after September 2, 2014, the permit application fu lfills the advance notification requirement. In addition, w e believe in cases where a permit is required the permitting process addresses the tribal and historic preservation obligations cited by the

commenters. Because none of the commenters presented exa mples of a situation where the 30

- day advance notification provision justifies a reduction, we are retaining the 30

- day notification period. In the additional discussion in section 2.5.2 , we are clarifying that the advance notice relocation provision is i ntended to apply to entire sources and not individual pieces of equipment

or emissions units

.



### 2.5.2 Permitting Issues related to Source Relocation

Comment:

One industry association commenter (0182) referenced the EPA’s discussion in the proposed rule preamble addressing permitting obligations for true minor sources that relocate (78 FR 33273)

. The commenter disagrees with the EPA’s statement that a true minor source constructed before September 2, 2014 that relocates after that date will have to obtai n a permit.

9 See memorandum titled Summary of Discussion from the October 23, 2013, Teleconference between API Representatives and the Environmental Protection Agency on Source Relocation under the Tribal Minor NSR Rule

. Nov 13, 2013. Docket number EPA

- HQ

- OAR

- 2003

- 0076

- 0188

.

10 This section allows sources to submit changes to previously provided information within 15 days after the change occurs.Review of New Sources and Modifications in Indian Country

- Amendments Response to Comments

13 The commenter states that relocation is not tantamount to a modification of such a source and therefore the need for a permit is not triggered. The commenter clarified i n a subsequent

teleconference 11 that most of the situations addressed in the comments involve relocation or replacement of a single piece of equipment, not entire facilities.

Further, t he commenter disagrees with EPA’s statement in the proposed rule preamble that a true minor source constructed after Sept 2, 2014 must obtain a p ermit for the original location and any subsequent relocation not specifically pre

- auth orized in the original permit. The commenter believes the EPA should clarify that permit conditions listing specific sites for relocation are not required

. The commenter states that this approach would be particularly important for general permits where the ability to relocate would have to be based on generic criteria. The commenter believes no other approach would work with a general permit.

Response:

The registration program and relocation provisions in 40 CFR 49.160(d)(1) apply to an

entire true minor source, they are not applicable to an individual piece of equipment that is merely a part of the true minor source

. The registration program is used in develop ing an inventory of emissions throughout Indian country to help us manage and protect air quality. We

understand from the commenter that moving a single piece of equipment from one facility to another, or replacing a piece of equipment with a new one
, can occ ur on a regular basis. For clarification purposes , we believe it would be beneficial to both sources and reviewing

authorities for us to list the different situations involving a piece of equipment that we believe

will be most common

, and specify the outco me with re spect to minor NSR permitting. While we have listed expected outcomes below, the source should still verify with its reviewing authority

that the “matching” situation listed below

, and its stated outcome

, applies to its case :

1) A u nit at a permitted source is replaced “ in kind ” ( i.e., the replacement unit is of the same size, capacity, horsepower, etc. as the existing unit)

– The owner/operator should n otify the reviewing authority as specified in its permit. If the existing permit cond itions do not address equipment replacement/relocation then the source should send a notification letter to its reviewing authority no later than 60 days following replacement of the unit.

2) A u nit at a registered but unpermitted source is replaced in kind

- N o new notification require d since this unit would already be part of the inventory

.

3) A u nit is moved within the boundary of a permitted or registered source

- No new notification to the reviewing authority required, unless otherwise specified in the permit.

4) A unit planned for addition (i.e., not replacement) at either a permitted or registered
source, with PTE above the minor NSR thresholds

– T he owner/operator of the true minor

source must first obtain a minor source permit befor e installing the unit at the new location beginning on September 2, 2014

.



## 1 11 Ibid . 9, p. 12.Review of New Sources and Modifications in Indian Country

- Amendments

Response to Comments

14 5) One or more units ( with combined PTE between the minor and major source thresholds) that are relocated to a n entirely new location (i.e., a greenfield facility)

– a) P rior to Sep tember 2, 2014 , the owner/operator of the true minor source must notify its reviewing authority within 90 days of beginning operation at the new location in accordance with 40 CFR 49.160(c)(1)(ii) ; b) O n or after September 2, 2014, the owner/operator of the true minor source must obtain a minor NSR permit from the reviewing authority at the new location before beginning construction.

6) A unit moved from one registered source to another registered source before the September 2, 2014 permitting deadline

– T he source must notify the reviewing authority of removal of the unit from the originating source (to update its inventory) and also notify the reviewing authority of the addition of the unit at the new source within 60 days fo llowing the change in location.

Note: We are not addressing any comments pertaining to general permits in this

document since the proposed amendments did not address general permits.

Comment :

One industry commenter (0186) expressed concern with impacts to drilling schedules created by the permitting process (up to 6 months for individual permits) and believes the EPA should allow oil and gas operators to transfer an approved minor source permit to a new location

, within the same basin or "general area," as long a s constructi on hasn't commenced. The commenter states that such a transfer would be done without reopening the permit and further delayin g the oil and gas development. The commenter believes the EPA could require notice of such a transfer 10 to 30 days prior to the s ource commencing construction at the new location, thus saving time and resources for all parties.

Response:

We believe it would be appropriate to address situation s such as those cited by the

commenter on a case

- by

- case basis. We believe that oil and/or gas basins are too varied in terms of size, terrain, proximity to other emission units and other parameters to develop any generalized criteria that could allow preapproval of locations beyond the single location

author ized under the initial permit

.



### 2.6 Other Comments on Permitting

Comment :

One industry association commenter ( 0182 ) states that, in the existing federal Indian country minor NSR rule , true minor sources constructed or modified after August 30, 2011

, are required to ob tain a permit. The commenter notes that t he EPA proposed to revise this applicability date until September 2, 2014

, and t he commenter supports this change.

Response:Review of New Sources and Modifications in Indian Country

- Amendments Response to Comments

15 We believe the commenter may have misinterpreted the existing requirements within 49.151(c)(1)(iii). Our intent under the existing rule has always been that true minor sources do

not need a permit if they commence construction before September 2, 2014. We proposed changes to the regulatory text on June 4, 2013, that are intended to cla rify the nature of this

deadline. We are finalizing these proposed changes to the regulatory text to make this intent

clear.



### 2.7 Miscellaneous Comments

2.7.1 Rulemaking Process

Comment :

One private citizen ( 0178 ) references the discussion in the proposed rule preamble ( 78

FR 33270 ) , and characterizes EPA’s consideration of burden in the permitting process for various source types, as looking at the "co st/benefit" of the regulation. The commenter opines that such an analysis is inappropriate on existing regulati ons. The commenter elaborates that cost should be considered in amending a regulation, but it should not be as prominent a factor as it appears to be in the proposed rulemaking.

Response:

The units/activities proposed for addition to the exemption list were identified primarily

based on their low emission potential. A cost analysis was not generated or used to select the exemption categories

.



### 2.7.2 General Permits

Comment:

One industry association commenter (0182) cites applicability provisions for obtainin g a permit (note: these are under 49.151(c)(1)(iii)(B)), and expresses concern related to coverage under a gener al permit to meet those dates. The commenter states that the EPA should allow coverage immediately after the effective date of the general permi t rather than requiring the

source to wait six months after publication in the Federal Register to seek coverage. Alternatively, the commenter suggests, the EPA could push back the September 2, 2014 permitting deadline to a reasonable period after general permit publication.

The industry association commenter also states that the current rule allows sources to apply for coverage under a general permit no earlier than 6 months after a general permit is published in the Federal Register . The commenter belie ves that, based on the availability of the general permit, the EPA would need to publish the final general permit for the oil and gas sector

in the Federal Register no later than December 2, 2013

, to provide affected sources sufficient

time to obtain cover age by September 2, 2014. The commenter opines that failure to make the general permit available in a timely fashion will require all oil and gas sector sources to obtainReview of New Sources and Modifications in Indian Country

- Amendments

Response to Comments

16 site

- specific permits, and that this outcome would be a waste of time and resources. The

commenter states that the EPA should make it clear that sources are deemed covered if the EPA fails to respond to a general permit request.

One industry commenter (0186) recommends that the EPA engage industry stakeholders and tribes early in the gen eral permit development process (i.e., prior to proposal of a draft general permit) to accurately consider the scope, impacts and other criteria of oil and gas sources

as well as to make sure Tribal interests are met.

Response:

Requirements related to coverage under the general permit were not part of the amendments proposed on June 4, 2013. However, a notice of proposed rulemaking related to general permits for minor sources in Indian country was publi shed in the Federal Register on January 14, 2014

. That notice asks for comment on extend ing the permitting deadline for true minor oil and gas sector sources between 12 and 18 months beyond the deadline cited by the industry association commenter.



### 2.7.3 Environmental Appeals Board

Comment :

One industry commenter ((0186) notes that an individual minor source permit could take up to six months for approval. Since the commenter anticipates a need for up to 50 true minor source permits annually, these "delays" are economically significant and th e commenter is concerned about the EPA's resources and ability to m eet permit issuance deadlines. The

commenter continues that i n addition to the review and issuance time period, the Environmental Appeals Board (EAB) review process can also be invoked, add ing further delay (up to two years in total) before per mitted operations could begin. The commenter believes this process is inefficient, inappropriate, and unnecessary for minor sources and requests that the EAB review process be eliminated for true and s ynthetic minor NSR permits

. As an alternative, the commenter requests that a more expeditious review process be established that include s the elimination of the automatic "stay" f or minor and synthetic NSR permits while awaiting EAB

review.

Response:

The EAB review process was not part of the amendments proposed on June 4, 2013

.