## Summary of Interagency Working Comments on Draft Language under

EO12866/13563 Interagency Review. Subject to Further Policy Review.

 Some commenters would like to better understand the implied consequences for small businesses that arise from the mix of known and unknown control strategies. To the extent that EPA projects costs based on known control strategies already considered in other rulemakings,

we reques t EPA provide discussion of the relative contribution of small entities to the emissions inventory and the extent to which EPA has implicit assumed in its economic analysis that small entities would install control equipment not otherwise required in indus try specific rules.

 Some commenters have attempted to understand these impacts for ICI boilers, but could not recreate the impacts based on the information made available so far. It is not clear in the RIA’s estimation of costs and emission reductions from known control strategies applied to ICI boilers if these are calculated from major or area sources or both. In order to properly evaluate the impact known controls will have on small entities, it is important to understand which sectors will have known control costs from ICI boilers at major o r area sources. Specifically, to reduce emissions further, is EPA assuming that ICI boilers at area sources will now require SCR and LNB
controls? If major and area ICI boilers apply controls beyond standards in the Boiler MACT, a significant percentage of small entities may be impacted. From EPA’s 2013 ICI boiler MACT rule at major and area sources, the categories of small entities potentially affected included major sources at lumber mills (NAICS 321) and municipal boilers (NAICS 221), and area sources at schools (NAICS 611), churches (NAICS 8131), and hospitals (NAICS 622). To determine the impact on these entities, we need to find out their appropriate share of the calculated control

costs. Additionally, we do not have a clear understanding on how t he projected costs from NOx measures applied to ICI boilers were calculated. When attempting to reproduce the projected costs of NOx measures to ICI boilers, we did not reach the same numbers from Ch.7 of the RIA when using a straight forward calculation of multiplying the tons reduced per year to the average cost per ton for the non

- EGU point sector. We suggest EPA further explain how EPA arrived at these numbers when determining the costs of NOx measures to ICI boilers.

 Similar issues arise in working to understand the incidence of nonroad controls. An unfunded nonroad diesel retrofit program would likely impose significant burdens on small entities. Some commenters would like to have a better understanding of how much nonroad diesel equipment
would n eed to be retrofitted and the economic sectors in which this equipment is operated. In sectors for which small entities are a significant presence, EPA may be underestimating the average cost of compliance.

 Some commenters also have significant concerns about the extrapolation of costs for unknown compliance technologies, and seeks to better understand how EPA modeled these costs. As above, presentation of average costs can hide significant disparities in compliance costs for small entities, and where sm all businesses are a significant proportion of the industry, this may
lead to underestimates.

 EPA bases its estimates of the extrapolated costs for emissions reductions to be $15,000 per ton using the average

- cost methodology. This estimate is based off of known control costs available, which does not have a citation, rather than a survey of known control methods most

## Summary of Interagency Working Comments on Draft Language under

EO12866/13563 Interagency Review. Subject to Further Policy Review.

likely to be used by firms. Additionally, it is reasonable to expect that the control cost for small businesses will be higher than the as sumed $15,000 per ton, but the commenters do not have the information necessary to understand the extent of this problem because EPA does not present industry analysis by subcategories of industry and firm size. Using the average

- cost methodology combine d with economies of scale, costs to small businesses will consistently be higher across all small firms.

 EPA states that their estimate undervalues the higher cost controls that regions may apply to
meet the alternative standards. This means that small f irms may experience an even more severe cost of compliance than EPA has accounted for depending on their geographic
location. This is not factored into the $15,000/ton estimate.

 Interagency commenters request that EPA provide citations for its data sourc es and discuss in greater detail the barriers to obtaining consistent data across original data sources. Without the proper citation of sources, it is difficult to replicate and verify EPA’s cost estimates or understand the original studies’ methodologies

. The commenters wish to encourage EPA to share its data sources and methodology in a more transparent fashion.

 Tables ES

- 6, ES

- 8, 5

- 1, 5

- 2, 5

- 23, 5

- 30, 5C

- 10

– These tables should be split to show explicitly the benefits derived for ozone only and then for total benefits. We agree that the total benefits (ozone plus PM) should be shown; however, it is quite informative, especially in an ozone rule,
to show the ozone

- only benefits in addition to the total benefits. That would give the public a

more comp lete view of the related benefits achieved by this rule. Additionally, it is unclear
whether Tables 5

- 19, 5

- 20, 5

- 21, 5

- 22, 5

- 26, 5

- 27, 5C

- 6, and 5C

- 7 show combined ozone and PM
values. If so, these should also be split as suggested.

 Tables ES

- 7 and ES

- 9 and Section 1.4

– EPA’s analysis of benefits related to human health are heavily weighted toward experimental, theoretical, and statistical analyses. EPA has revised the

O 3 NAAQS a number of times since 1979, and there have been many areas that have ach ieved attainment and/or made progress toward achieving previous NAAQS. It would seem reasonable that EPA should incorporate information related to the air quality improvement and resulting improvement in public health to verify that the assumptions and pr ocedures used in setting the NAAQS actually make sense and accurately predict the actual improvement. For example, EPA
could look at a number of nonattainment areas for O 3 that have achieved the standard and answer the following: “We expected __ improvem ent in O 3 concentrations due to the implementation and attainment of a certain NAAQS level in area __ and thus we expected to achieve __ improvement in public health (choose various public health metrics used in setting the standards, such as expected redu ced mortalities, expected reduced hospital visits, etc.). After implementing the regulations and achieving O 3 concentrations of __, we actually saw __ improvement in public health.” Conducting such an analysis would lend credibility and a
valuable means of verifying initial assumptions, as well as verifying those data obtained from chamber studies and other experimental work matched reality. As such, EPA should prioritize research and analytical efforts to begin evaluating the actual impacts achieved fro m ozone reductions.

## Summary of Interagency Working Comments on Draft Language under

EO12866/13563 Interagency Review. Subject to Further Policy Review.

 Chapter 5 (and other benefits analyses)

– In estimating costs associated with this rule, EPA seems to exclude those costs associated with the implementation of already promulgated or
known rules. While this is acceptable, EPA needs to ensure that the benefits associated with those rules particularly are also excluded such that they are not double

- counted. It appears that EPA’s ozone benefits estimates simply look at benefits accrued by achieving certain ambient
standards without inste ad focusing on the difference in ozone concentrations expected after implementation of the promulgated or known rules and achievement of the various standard levels included in the analysis. For example, if already promulgated or known rules would result in achievement of a 70 ppb level in a certain area, there should be a zero value for benefits resulting from this rule in that area, just as there is a zero value for costs to achieve the 70 ppb
level in that area. In short, benefits (and costs, for that matter) attributed to this rule should be strictly limited to those achieved via the attainment strategies needed to achieve the various standard levels in addition to those rules already promulgated or known.

 More Specific Comments:

(2

- 1) In practice, t he distinction between natural and anthropogenic sources is often unclear, as human activities may directly or indirectly affect emissions from what would have been considered natural sources during the preindustrial era. Thus, emissions from plants, anima ls, and wildfires could be considered either natural or anthropogenic, depending on whether emissions result from agricultural practices, forest management practices, lightning strikes, or other types of events (US EPA, 2013, sections 3.2 and 3.7.1). Mode rn anthropogenic efforts to restore natural ecological function, such as those associated with prescribed fire (both forestry and agricultural) and forest management practices, should not be considered anthropogenic. Rather, they are intended to reverse n egative anthropogenic influences on natural ecosystems.

(2

- 16)

– General Comment:

The RIA states “Background ozone is a relatively larger percentage (e.g., 70

- 80%) of the total
seasonal mean ozone in locations within the intermountain western U.S. and along the U.S. border. In locations where ozone levels are generally higher, like California and the eastern U.S., the seasonal mean background fractions are relatively smaller (e.g., 40

- 60%). The additional 2007 modeling confirms that background ozone, wh ile generally not approaching levels of the ozone standard, can comprise a considerable fraction of total seasonal mean ozone across the U.S (EPA, 2014c).”

Yet just 2 pages before (p. 2

- 14) EPA states “From a seasonal mean perspective, background
ozone le vels are typically well

- below the NAAQS thresholds.” Clearly, 40

- 80% background (of total) is NOT “well

- below.” It is very significant, especially in the rural West, and the statement on p. 2

- 14 can be very misleading and is in fact erroneous. Please pr ovide a more in

- depth and accurate discussion of background levels in different parts of the country.

(2

- 17)

– General Comment:

## Summary of Interagency Working Comments on Draft Language under

EO12866/13563 Interagency Review. Subject to Further Policy Review.

The RIA states “It should be noted here that EPA has policies for treatment of air quality monitoring data affected by these t ypes of events. EPA’s exceptional events policy allows exclusion of certain air quality monitoring data from regulatory determinations if a State adequately demonstrates that an exceptional event has caused the exceedance or violation of a NAAQS. In additi on, Section 179B of the Clean Air Act (CAA) also provides for treatment of air quality data from international transport when an exceedance or violation of a NAAQS would not have occurred but for the emissions emanating from outside of the United States. F inally, CAA section 182(h) authorizes the EPA Administrator to determine that an area designated nonattainment can be treated as a “rural transport area”. In accordance with the statute, a nonattainment area may qualify for this distinction if it meets the following criteria: 1) the area does not contain emissions sources that make a significant contribution to monitored ozone concentrations in the area, or in other areas; and 2) the area does not include and is not adjacent to an MSA.”

First, as some inte ragency commenters have previously stated regarding the proposed new primary and secondary NAAQS levels, EER demonstrations can be unnecessarily burdensome for states, and until fire

— both wild and prescribed

— is fully incorporated into EPA background
levels there will be an increasing EER burden on the states. EER demonstrations are not easy, nor quick. The approach outlined by EPA is not a solution to this major issue.

Second, it would be good to know about “rural transport areas” and how vast areas of the western and central US might be designated in this way (esp. w.r.t. fire needs). Please provide more discussion of RTA’s, how they have been used in the past, and the extent to which RTA’s can affect the obligations of States to demonstrate attainmen t in SIPs.