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# OAR Box 

# 1781
Prepped by Ollie Stewart



## Document

Number: 

# 147 ) lll-A- 8

Docket Number: 

# A-90-3 7

Printed 10/29/2008 12:31:58 PM Sheet 147 of 148P. 2



### Federal Register/Vol

. 63 , No

. 142/Friday , July 24 , 1998/Notice s 

# -3 7 3985 7

Offic e of Informatio n an dRegulatory Affairs , Offic e o f

Managemen t

an d Budget , Attention : Des k

Office r fo r EPA

. 72 5 17t

h Street , NW

. Washington , D

C 20503

. Dated : Jul y 20 , 1998

. Joseph Retzer , Director, Regulatory Information Division. [F RDoc

. 98-1984 0 File d7-23-98 J BILUN G COD E I

PROTECTIO N



# FE B 

# 1 ENVIRONMEN T A?

. AGENC Y [FRL-6128-5] ! Notic e o f AvaSlability^^iffitJ^i^o7

_ Ne w Sourc e Rlevie

v Applicabilit yfo rMajo rModifications ; Solicitatio n o f Commen t AGENCY : Environmenta l Protectio n Agency

. ACTION : Notic e of

availability

. SUMMARY : Th e EPA i s solicitin g comment s o n aspecifi c alternativ e for determinin g th e applicabilit y of NS Rt o modification s o f

majo r stationar y sources , unde r

th e Preventio n of Significan t

Deterioratio n (PSD) an dth e nonattainmen t

provision s of

th e Clean Ai r Ac t (Act)

. Thi s alternativ e woul d allo w an y sourc e t o legall y avoi dmajo r NS Rrevie w for

aphysica l o r

operationa l chang e t o a n existin g emission s uni t b y takin g a n enforceabl e temporar y limi t o n emission s fro mtha t

uni t for aperio d of a t leas t 1 0 year s after

th e change

. I n addition , th e Agenc y i s seekin g commen t upo n whe n an dunde r

wha t circumstance s permittin g authoritie s shoul dhav e t o revis e th e emission s leve l se t unde r aplantwid e applicabilit y limitatio n (PAL

) for an y give n source
. DATES : Writte n comment s mus t b e receive do n o r

befor e Augus t

24 , 1998

. ADDRESSES : Comment s mus t b e identifie db y th e docke t

numbe r [A-90

- 37] , an dshoul db e submitte d(i n duplicate , if

possible ) to : Ai r

an d Radiatio n Docke t

an dInformatio n Cente r (6102)

. Attentio n Docke t Numbe r A-90-36 , Roo mM-1500

. U.S

. Environmenta l Protectio n Agency , 40 1 M Street , S.W. , Washington , D.C

. 20460

. Th e EPA request s aseparat e cop y als o b e sen t t o th e contac t

perso n liste d belo w (se e FO

RFURTHE

RINFORMATIO

N CONTACT)
. Comment s ma y als o b e submitte d electronicall y b y sendin g electroni c mai l (e-mail ) to : a-and-r

docket@epamail.epa.gov

. Submi t comment s a s a n ASCII fil e avoidin g th e us e of specia l character s an dan y for m o f encryption

. Comment s an ddat awil l als o b e accepte do n adiskett e i n WordPerfec t 5. 1 o r 6. 1 o r ASCII fil e format

. Identif

y al l comment s an ddat a i n electroni c for

mb y docke t

numbe r A

90-37

. N o Confidentia l Busines s Informatio n (CBI

) shoul db e submitte d throug he-mail

. Informatio n submitte da s acommen t concernin g thi s documen t may b e claime dconfidentia l b y markin g an y "paf t o r al l o f tha t informatio n a s CBI

. Informatio n s o marke dwil l no t b e disqlose dexcep t

i n accordanc e wit h procedure s se t

forthi n 4 0 CF

Rpar t 2

. A cop y o f th e commen t

tha t doe s no t contai n CB I mus t

b e submitte dfor | inclusio n i n th e publi c record

. Informatio n no t

marke dconfidentia l jviUj e include di n th e publi c docke t b y !P A withou t

prio r notice

. FO R FURTHE R INFORMATIO N CONTACT : B y mail : Davi dSolomon , Integrate d Implementatio n Group , Informatio n Transfe r an dProgra mIntegratio n Division , -(MD-12) , Environmenta l Protectio n Agency , Researc hTriangl e Park , N.C

. 27711 , telephon e 919-541

- 5375 , facsimil e 919-541-5509 , o r e-mai l solomon.david@epamail.epa.gov

. Fo r informatio n o n th e sectio n of thi s notic e addressin g PAL's , contac t Mik e Sewel l a t th e abov e address , telephon e 919

- 541-0873 , facsimil e 919-541-5509 , o r e
mailsewell.mike@epamail.epa.gov

. Electroni c Availability : Interne t Electroni c copie s of

thi s documen t als o ar e availabl e fro mth e EP A hom e pag e a t th e Federa l Register

— Environmenta l Document s entr y fo r thi s documen t

unde r "Law s an d Regulations " (http://www.epa.gov / fedrgstr/ ) o r

fro mth e Offic e of

Ai r an d Radiatio n hom e pag e at

http:/ / www.epa.gov.ttn/oarpg

. I

. Purpos e Th e firs t purpos e o f

thi s notic e i s t o solici t commen t

fro mth e intereste d publi c o n aspecifi c polic y optio n for determinin g th e applicabilit y o f NS Rt o modification s a t

existin g major stationar y sources
. Althoug hthi s optio n wa s on e o f

man y propose di n a n earlie r Notic e of Propose dRulemaking , EP A no w seek s commen t

o n asingl e alternativ e i n orde r

t o ensur e tha t

th e publi c ha s ful l opportunit y t o evaluat e it s merit

. Second , th e Agenc y i s seekin g commen t o n aspecifi c approac h wit h regar dt o PAL's

. Previousl y EP A solicite dan dreceive dsevera l hundre d comment s o n it s NS Rreformpackag e propose di n Jul y 1996

. Th e EP A ha s reviewe dan di s dul y considerin g thes e comments

. Fo r

purpose s o

f thi s Notic e o f Availability , commenter s shoul d limi t thei r remark s t o th e issue s discusse dbelow

. Becaus e of th e opportunit y provide dpreviousl y fo r commen t

o n th e NS RReformitems , comment s relatin g t o issue s othe r tha n thos e se t forth i n thi s Notic e wil l no t b e considered

. II

. Backgroun d O n Jul y 23

. 1996

. EPA propose dt o mak e significan t

change s t o th e existin g majo r NS Rprogra m("NS RReform" ) [Se e 6 1 F R38249]

. I n larg e part , thes e propose dchange s concer n th e applicabilit y o f

th e majo r

NS R requirement s t o modification s a t existin g stationar y sources
. Th e Agenc y solicite dcommen t

o n anumbe r

o f methodologie s for

determinin g NS R applicabilit y whe n asourc e undergoe s a modificatio n [Se e id

. at

38266-70]

. A s a resul t o f comment s received , change d circumstances , an dfurthe r revie w o f th e issue s b y th e Agency , EPA i s seekin g furthe r commen t

o n on e particula r methodology

. I n th e sam e earlie r

notice , EP

A propose dt o authoriz e permittin g authoritie s t o establis hfacility-specifi c PAL' s base do n th e source' s histori c actua l emissions

. Th e Agenc y solicite d publi c commen t

o n wha t circumstance s woul dnecessitat e revisio n o f PA L limits

. Severa l commenter s suggeste d tha t PAL' s mus t

b e periodicall y change d t o reflec t recen t actua l emissions

. Th e EPA i s als o concerne dtha t lega l consideration s ma y requir e aperiodi c evaluatio n o f

th e PALlimit

. III

. Applicabilit y Methodolog y fo r Modification s to Existin g Majo r Source s A. Current

NSR Applicability Test

for Major Modifications 1

. I n Genera l Majo r NSR—that

is

. PS D o r nonattainmen t

NSR—applie s t o al l "majo r modifications. " A "majo r modification " i s "an y physica l chang e o r chang e i n th e metho do f operatio n of amajo r stationar y sourc e tha t

woul d resul t i n asignifican t

ne t emission s increas e o f

an y pollutan t

subjec t t o regulatio n unde r

th e Act. " I n othe r words , majo r

NS Rapplie s if

, a s aresul t o f th e change , th e tota l emission s from ne w an dexistin g emissio n unit s a t th e source , whic h ar e otherwis e affecte db y o r par t of th e change , excee dth e curren t actua l emission s of

thos e unit s b y a significan t

amoun t (a s define di n th e regulations). '

1 Whe n post-chang e emission s fro m achanged uni tand al l othe raffected unit s ar e significant , th e propose d chang e a

tth e sourc e ma

y nevertheles s avoi d revie w if

, whe n considerin g any other contemporaneou s emissio n increase s and decrease s a tth e source , th e ne temission s Increas e I s les s tha n significant
. Th e summin g o f increase s an

d decease s a tasourc e thatar

e contemporaneou s with , butno t resultin g from, apropose d chang e fo rth e purpos e Continue dP. 3



## 3985 8 Federa l Register/Vol
. 63 , No

. 142/Friday , Jul y 24 , 1998/Notice s
Vital , then , t o determinin g NS R applicabilit y i s evaluatin g asource' s "actua l emissions " bot hbefore an dafter aphysica l o r

operationa l chang e t o determin e whethe r

i t constitute s amajo r modification

. Pre-chang e actua l emission s for

th e variou s emission s unit s a t th e sourc e constitut e th e "baseline " fo

r thi s evaluation

. Unde r curren t regulations , th e baselin e i s calculate dbase do n th e averag e annua l emission s durin g th e 2-year perio d precedin g th e chang e (or , wher e th e permittin g authorit y determine s tha t anothe r perio di s mor e representativ e of norma l sourc e operations , i t use s tha t period)

. Eg., 4 0 CF

R52.21(b)(21)(ii)

. Onc e th e baselin e i s determine di t mus t b e compare dt o emission s after th e change

. Sinc e NS Rapplicabilit y i s determine dprio r

t o construction , som e projectio n o f

post-chang e emission s mus t b e mad e fo

r th e comparison

. Existin g emission s unit s tha t ar e no t undergoing , o r

otherwis e affecte dby , a physica l o r

operationa l chang e ar e deeme dt o hav e "begu n norma l operations, " an dbaselin e actua l emission s ar e simpl y projecte dforwar d t o th e post-chang e timeframe ; thus , thes e unit s fal l ou t

o f th e applicabilit y calculus

. Unde r

EPA' s curren t regulations , post-chang e actua l emission s for

unit s whic hhav e "no t begu n norma l operation s * * * equa l th e potentia l t o emi t

(PTE ) o f th e uni t o n tha t date. " Eg., 4 0 CF

R 52.21(b)(21)(iv)

. Fo r

ne w units , whic h obviousl y hav e no t

begu n norma l operations , th e pre-chang e baselin e i s zero , an dth e post-chang e emission s equa l th e units ' PTE

. Determinin g post

chang e emission s fo r

existin g unit s tha t are modifie do r

otherwis e affecte db y th e chang e ca n b e mor e complex

. Th e regulator y tes t

for thes e situation s ha s com e t o b e know n a s th e "actual-to

potential " methodology

. I n brief , unde r th e curren t

regulations , change s t o auni t

a t amajo r stationar y sourc e tha t

ar e non-routin e o r

no t subjec t t o on e o f th e othe r majo r sourc e NS Rexemption s ar e deeme dt o b e of suc h significanc e tha t

pre-chang e emission s for

th e affecte dunit s shoul d no t b e relie do n i n projectin g post

chang e emissions

. Fo r

suc hunits , "norma l operations " ar e deeme dno t t o hav e begu n followin g th e change , an d ar e treate dlik e ne w units

. Pu t anothe r way , th e regulator y provisio n for unit s whic h hav e "no t

begu n norma l operations " reflect s a n initia l presumptio n tha t

auni t tha t ha s undergon e anon-routin e physica l o r

operationa l chang e wil l operat e a t it s ful l capacit y year-round

. A sourc e owne r o r operato r may rebu t

th e presumptio n tha t

th e uni t wil l operat e a t it s ful l potentia l b y agreein g t o limi t it s PT E throug h enforceabl e restriction s tha t limi t th e units ' abilit y t o emi t mor e tha n thei r

pre-modificatio n actua l emission s (plu s a n amoun t tha t i s les s tha n significant"). 2 Th e ter m"actual-to-potential " i s somewha t

o f amisnomer , becaus e i n practice , thi s methodolog y involve s a determinatio n o f

futur e actual emission s t o th e atmosphere

. Tha t is , sourc e owner s an doperator s contemplatin g amodificatio n projec t asses s th e likel y utilizatio n of th e affecte dunit s followin g th e change

. I f thos e level s o f

utilization , whe n combine dwit h th e hourl y emission s rate s (an dcontemporaneou s emission s increase s an ddecrease s elsewher e at th e plant) , woul dresul t

i n futur e actua l emission s significantl y highe r tha n th e pre-chang e baseline , th e owne r o r operato r mus t obtai n amajo r

NS R permit

. I f th e owne r

o r operato r project s tha t futur e actua l emission s wil l no t significantl y excee dth e baseline , th e owne r o r operato r instea dobtain s a minor NS Rpermi t

o r othe r devic e tha t legall y limit s th e affecte dunits ' emission s t o aleve l tha t

i s no t significantl y abov e baseline

. Th e en d resul t unde r thi s secon dscenari o ar e individua l limit s o n th e emission s o f th e new , modified , an daffecte dunit s whic h assure s tha t

ne t emission s a t

th e plan t wil l no t significantl y increas e a s aresul t o f th e change

. Nevertheless , th e owne r o r operato r i s alway s fre e t o chang e plan s i n th e future

. If

. fo r example , a ne w assessmen t

indicate s tha t

i t woul d b e economicall y usefu l t o utiliz e th e affecte dunit s a t

level s tha t

woul d excee dth e establishe dlimits , th e owne r

of avoidin g NSRi s commonl y referre d to a s a "netting " analysis
. Th e alternativ e discusse d I n thi s notic e onl y involve s modification s thatd o no t triggeranettin g analysis
. *Th e "PTE " i s currently define d a s th e "maximum capacit

y of astationar

y sourc e t o emi t apollutan tunde rit s physical and operational design. " An y physica l oroperational limitatio n o n th e capacit

y of th e sourc e to emi tapollutant , includin g apermi tlimitation , i s treated a s par tof its desig n provide d th e limitatio n o rit s effecto n emissions i s federall y enforceable (e.g. , see existin g section s 51.165(a)(l)(iii ) and 51.166(b)(4))
. I n recentdecisions , National Mining Ass'n v . EPA. 5 9 F.3 d 135 1 (D.C
. Cir
. 1995) and Chemical Manufacturers Ass'n v . EPA, No . 89-1514 , sli p op . (D.C
. Cir
. Sept
. 15 , 1995) , th e Districtof Columbi a Circuitcour

taddresse d challenge s related to EPA' s requirementthatasourc e whic h wishe s t o limi tit s PT E mus tobtai n afederally enforceabl e limit
. Th e EP A i s currently reviewin g it s Federa l enforceabilit

y requirement

s i n ligh tof

thes e court decisions , and ha s no tye tdecide d ho w itwil l addres s thi s issue
. Once EP A has complete d it s revie w of th e Federa

l enforceabilit

y requirement

s i n al l relevan tprograms includin g NSR , th e Agenc y wil l mak e availabl e I

n aFedera

l Registe rnotic e it s respons e t o th e courtdecisions
. o r operato r ma y obtai n amajo r

NS R permi t a t tha t futur e time

. See e.g. , 4 0 CFR52.21(r)(4)

. Th e practica l working s of th e curren t regulations , a s describe dabove , hav e lon g bee n controversial

. Industr y representative s maintai n tha t th e "actual-to-potential " methodolog y result s i n "confiscation " of unuse d plan t capacit y followin g amodificatio n project

. Environmenta l group s respon d tha t plan t capacit y unaffecte db y th e modificatio n projec t

ca n continu e t o b e use da t an y desire dleve l of

utilizatio n (subjec t t o an y prio r

limit s o n tha t

use) , an dtha t an y constraint s ar e impose d appropriately , i.e. , onl y wher e th e utilizatio n o f

pre-existin g plan t

capacit y i s likel y t o b e affecte db y th e modificatio n projec t

i n awa y tha t

wil l significantl y increas e actua l emission s ove r baselin e emissions

. 2

. Litigatio n Ove r

th e Actual-to

Potentia l Tes t Becaus e th e presumptio n discusse d abov e force s source s whos e post-chang e potentia l emission s excee dthei r pre
chang e actua l emission s t o underg o NS R o r tak e alimi t

o n th e affecte dunits ' potentia l emissions , industr y has , a s noted , lon g objecte dt o th e Agency' s us e o f th e "actual-to-potential " methodolog y for

existin g unit s undergoin g anon-routin e change

. Th e EPA' s interpretatio n of

it s regulation s consequentl y ha s bee n a t issu e i n tw o cases , Puerto Rican Cement Co. v
. EPA, 88 9 F.2 d29 2 (1s t

Cir. 1989)

. an d Wisconsin Electric Power Co. v
. Reilly, 89 3 F.2 d90 1 (7th Cir. 1990) ("WEPCO )

. Specifically , eac hof thes e case s addresse dwhethe r th e Agenc y acte dreasonabl y i n treatin g unit s whic h ha dundergon e anon-routin e physica l o r operationa l chang e a s no t havin g "begu n norma l operations. " I n Puerto Rican Cement, th e cour t foun dreasonabl e EPA' s presumptio n tha t aphysica l o r

operationa l chang e (i n thi s case , th e conversio n o f acemen t plan t fro mawe t

proces s t o amor e efficien t dr y process ) coul denabl e a modifie duni t

t o b e use da t

ahighe r capacit y tha n prio r

t o th e change , an d endorse dth e Agency' s us e of th e actual

to-potentia l tes t

i n suc h circumstances

. Se e 88 9 F.2 da t

297

. I n particular , th e cour t note dtha t

th e compan y "operate d it s ol dkiln s a t

lo w level s i n th e past ; it s new , mor e efficien t

kil n migh t

giv e i t th e economi c abilit y t o increas e production ; consequently , EPA coul d plausibl y fea

r a n increas e i n actua l emissions

. * * * " Id. at 298

. B y contrast , i n WEPCO, th e cour t hel d tha t EPA acte dunreasonabl y i n applyin g th e actual-to-potentia l methodolog y i n th e cas e o f WEPCO' s 

# 2

.P. 4



### Federal Register/Vol

. 63 , No

. 142/Friday , July 24 , 1998/Notice s 3985 9
life-extensio n project , i n whic h WEPC O sough t t o replac e numerou s component s o f th e stea mgeneratin g unit s at th e facility

. Th e cour t

objecte dt o EPA' s refusa l t o conside r

th e pas t operatin g condition s of

asourc e i n evaluatin g th e likel y post-chang e emissions

. I t coine d th e ter m"like-kin dreplacement, " an d rule dtha t th e applicatio n of

th e actual

to-potentia l tes t

t o like-kin d replacement s of

component s o f

a n existin g emission s uni t

wa s no t a reasonabl e interpretatio n of di e regulations

. Accordingly , upo n reman d fro mth e court , EPA assesse dth e change s a t

WEPC O base do n a compariso n o f

it s pre-chang e actua l emission s an dit s predicte dpost-chang e actua l emissions

. Thi s approac h ha s com e t o b e know n a s th e "actual-to

future-actual " methodology

. 3

. Electri c Utilit y Stea mGeneratin g Unit s I n Jul y 1992 , th e Agenc y promulgate d limite damendment s t o th e existin g majo r NS Rregulations , i n par t t o respon dt o th e WEPCO decision

. Th e "WEPC O rule " extende dadifferen t applicabilit y test—a n actual-to-future

actua l approach—solel y t o electri c utilit y stea mgeneratin g units. 3 Unde r thi s ne w system , autilit y unit' s pre
chang e actua l emission s ar e compare d t o it s post-chang e "representativ e actua l emissions, " define da s "th e averag e rate , i n ton s pe r

year , a t whic hth e sourc e i s projecte dt o emi t

apollutan t

for th e 2

- yea r perio dafte r

aphysica l chang e o r chang e i n th e metho do f operatio n o f

a unit

. * * * " T o guar dagains t th e possibilit y tha t

significan t

unreviewe d increase s i n actua l emission s woul d occu r unde r thi s methodology , th e regulation s provid e tha t

source s wit h utilit y unit s usin g th e actual-to-future

actua l approac h mus t

submi t t o th e permittin g authorit y sufficien t record s annuall y fo

r 5 year s afte r

th e chang e whic h demonstrat e tha t

th e chang e ha s no t resulte di n a n increas e abov e th e baselin e levels

. Unde r EPA' s regulations , unles s a chang e "result s in " a n increas e i n actua l emissions , i t

nee dno t underg o majo r NSR

. I n th e WEPC O rule , th e Agenc y
'Fo rNS Rpurposes , th e definitio n of "electri c utility stea

m generatin g unit " mean s an y steam electri c generating uni tthatIs constructe d forth e purpos e of

supplyin g more than one-third of its potential electri c outpu tcapacit y and mor

e tha n 2 5 M W electrical outpu tt o any utility powe r distributio n syste m forsale . An y steam supplie d to astea m distributio n syste m forth e purpos e of providin g stea

m t o asteam-electri c generato rtha t woul d produce electrica l energy fo rsal e i s als o considere d I

n determinin g th e electrical energ y outpu tcapacit

y o f th e affected facility
. Se e e.g. , 4 0 CF R52.21(b)(31)
. Reference s i n thi s notic e to utility unit s i s mean

tto includ e al l units covere d b y thi s definition
. attempte dt o defin e asituatio n i n whic h EP A woul dassum e tha t

ther e wa s n o causa l lin k

betwee n apost-chang e emission s increas e an daparticula r physica l chang e o r

chang e i n th e metho do f

operatio n for

electri c utilit y stea mgeneratin g units

. Th e EP A reasone dtha t

increase dutilizatio n du e t o deman dgrowth a t

autilit y uni t

di d no t resul t fromparticula r

physica l o r operationa l changes , bu t rathe r fro m marke t force s unrelate dt o th e change

. Consequently , th e regulation s no w provid e that , i n projectin g futur e actua l emissions , electri c utilit y stea m generatin g unit s ma y exclud e fro mth e estimat e an y emissio n increas e whic h result s fro mincrease dcapacit y utilizatio n a s aconsequenc e of "independen t

factors, " suc ha s deman d growth

. Th e WEPC O rul e applie s onl y t o th e modificatio n o

f existin g electri c utilit y stea mgeneratin g unit s for severa l reasons
. Th e Agenc y note dtha t loca l publi c utilit y commission s (PUC) requir e utilit y source s t o mak e reliabl e estimate s of

futur e capacit y utilization , an dtha t utilities ' histori c experienc e i n doin g s o woul dmak e th e applicatio n of a n actual-to-future-actua l methodolog y reasonabl e fo

r utilit y units

. I n addition , EP A conclude dtha t

it s pas t regulator y experienc e wit hth e electri c utilit y industry , especiall y th e requiremen t fro mtitl e I

V of th e Ac t tha t generator s instal l highl y accurat e monitoring , mad e unit s i n th e electri c powe r industr y mor e amenabl e t o th e sophisticate d trackin g essentia l t o mak e sur e tha t th e futur e actua l emissio n prediction s of a sourc e ar e accurate

. Th e Agenc y committe dt o conside r

i n adifferen t rulemakin g th e propriet y o f extendin g th e actual-to-future-actua l methodolog y t o othe r sourc e categories

. 4

. Proposa l t o Chang e NS RApplicabilit y I n th e Jul y 199 6 NS RRefor mpackage , EPA proposed , amon g othe r things , t o expan dth e us e of

th e actual-to-future

actua l approach

. Th e Agenc y note dthat , i n general , source s potentiall y subjec t t o majo r NS Rwoul db e require dt o instal l highl y accurat e monitorin g device s unde r othe r provision s o f

th e Act

. Consequently , suc hsource s coul db e simila r t o th e utilit y unit s tha t

currentl y ar e permitte dt o us e a n actual-to-future

actua l test

. Nonetheless , othe r industrie s als o differ

fro mth e electri c powe r secto r insofar a s electri c utilitie s ar e th e onl y source s whos e estimate s o f deman dan d capacit y utilizatio n ar e subjecte dt o independen t

revie w an dhav e bee n historicall y limite dt o aclearl y define d loca l marke t

area
. Th e Agenc y reasone d tha t permittin g authorities , thus , coul d rel y upo n th e prediction s of post-chang e utilizatio n i n th e electri c powe r secto r mor e comfortabl y tha n i n othe r industries

. T o ensur e th e reliabilit y of futur e prediction s fo

r non-utilit y units

. EPA solicite dcommen t

o n th e adequac y o f th e curren t

5-yea r trackin g requiremen t

(whic h require s source s t o repor t annuall y thei r

emission s t o th e permittin g authorit y for

5 years ) an d sough t suggestion s for

improvin g it. 4 B. Comments Received

and Changed Circumstances I n weighin g th e desirabilit y o f expandin g th e actual-to-future-actua l tes t t o othe r sourc e categories , EP

A ha s considere danumbe r

o f issues

. First , ar e ther e principle dreason s for treatin g non-electri c utilit y source s differently ? Second , hav e intervenin g event s o r furthe r reflectio n calle dint o questio n an y of th e base s upo n whic h th e Agenc y relie di n adoptin g th e test , an dar e change s therefor e necessary ? I n th e prio r

NPRM , th e Agenc y specificall y solicite dcommen t o n whethe r sufficien t

safeguard s exis t

suc h tha t othe r industrie s shoul db e abl e t o tak e advantag e of

th e actual-to-future

actua l methodology

. Th e EP A receive d severa l publi c comment s (se e EP A Ai r Docke t A-90-37 ) claimin g tha t non
utilit y unit s ar e situate dsimilarl y enoug h t o utilit y unit s tha t i t make s sens e t o exten dth e actual-to-future

actua l tes t

beyon dth e limite dscop e o f electri c stea mgeneratin g unit s t o othe r sectors

. Thes e commenter s observe d tha t th e Act' s monitorin g requirements , a s embodie di n th e Complianc e Assuranc e Monitorin g rul e an dit s titl e V reportin g an drecordkeepin g requirements , bot hwoul densur e tha t sources ' futur e actua l emissio n prediction s woul db e verifiable

. See ,

4 A s aresul tof

th e NS RRefor m proposal , the Agenc y receive d commentfro m certai n non-utlllty industrial stakeholder s wh o claime d tha tth e flexibility give n t o utilitie s i n th e WEPC O rul e wa s no tlimite d t o th e utility sector . Specifically , thes e commenter s argued tha

tsource s generall y were entitle d t o emplo y th e actual-to-future-actua l methodolog y forman

y physical o

roperational changes , becaus e th e change s wer e no to f suc h significanc e (such a s "like-kind " replacements ) tha t itcoul d reasonably b e claime d tha tth e sourc e ha

d "notbegun norma

l operations. " Th e EP

A disagree s wit h th e commenters . Th e NSRregulation s contai n onl y tw o applicability test s fo

rmodifie d units
. One of

these , th e actual-to-future-actua l approach , i s limite d to electri c utility steam generating units
. See , e.g. , 4 0 CF Rsectio n 51.165(a)(l)(xii)(E)
. Th e othe r alternativ e Is th e actual-to-potentlal methodology , applicabl e whe n th e sourc e has "notbegun norma l operations. " Thi s approac h applie s t o al l change s a tmajo rsource s tha

tar e no totherwis e exclude d fro m bein g considere d aphysica l oroperational change , suc h a s routine maintenance , repair, and replacement . Unde rth e curren trules , therefore , I

t i s Imprope

rfo ranon-utlllt

y sourc e t o emplo y anythin g buta n actual-to-potentlal tes tfo r examinin g physica l o

roperational changes . 

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e.g. , comment s IV-D-11 2 an d-121

. I n addition , commenter s note dtha t othe r industr y sector s routinel y projec t marke t deman dand , consequently , capacit y utilization , an dthes e commenter s argue dtha t suc h prediction s ar e a s reliabl e a s thos e submitte dt o PUC s b y electri c companies

. See

. e.g. , commen t IV-D

146

. Take n together , thes e comment s sugges t t o EP A tha t th e actual-to-future

actua l tes t

shoul db e expande dbeyon d utilit y units

. However , th e Agenc y als o receive danumbe r

o f comment s tha t recommende dlimitin g th e methodolog y t o utilit y units , reasonin g tha t ther e stil l exist s adisparit y betwee n utilit y an d non-utilit y unit s i n term s of thei r abilit y t o predic t an dtrac k

thei r futur e emission s accurately

. See , e.g. , comment s IV-D-10 9 an d-125

. Give n thes e divergen t

views , EPA agai n request s commen t

upo n th e adequac y o f existin g emissio n projectio n an d trackin g capabilitie s a t

non-utilit y industria l source s for

purpose s o f applyin g th e actual-to-future-actua l test

. Notwithstandin g stron g suppor t fro m industr y fo r

th e expansio n of

th e actual

to-future-actua l test , EPA believe s tha t it s experienc e wit h th e methodolog y give s caus e for

cautio n i n continuin g thi s tes t in its present

form. Th e regulation s provid e tha t

source s wit h utilit y unit s employin g th e actual-to

future-actua l approac h mus t maintai n an dsubmi t

t o th e permittin g authorit y "informatio n demonstratin g tha t th e physica l o r

operationa l chang e di dno t resul t i n a n emission s increase " for a5

- yea r period

. However , th e rule s d o no t specificall y detai l eithe r th e mean s for conductin g suc h verificatio n o r th e consequence s o f

asource' s failur e t o mee t it s projecte demission s level

. Fo r example , sinc e th e issuanc e o f th e WEPC O rule , i t

appear s tha t

althoug h ther e ar e asubstantia l numbe r o f change s t o existin g units , a s wel l a s a n increas e i n th e amoun t

o f electricit y bein g generate dfor

us e outsid e of

th e loca l servic e district , change s t o utilit y unit s a s wel l a s post-chang e emission s estimate s ar e no t

bein g reporte dt o permittin g agencies

. Moreover , th e Agenc y i s concerne d tha t a5-yea r overvie w of

emission s i s to o shor t aperio dt o encompas s al l increase s i n capacit y utilizatio n tha t coul dresul t

fro maparticula r

change

. A s EP A note di n th e NS RRefor m proposal' s discussio n o f th e baselin e fo

r establishin g pre-chang e actua l emissions , se e 6 1 F

Ra t 38258 , numerou s industr y commenter s clai m tha t 1 0 year s i s afai r

an drepresentativ e tim e perio dfor

encompassin g asource' s norma l busines s cycle , an di n th e Refor mproposa l EPA ha s propose dt o adop t a10-yea r lookbac k perio dfor establishin g pre-chang e baselin e emissions

. I

f EPA ultimatel y promulgate s a10-yea

r perio dfor baselin e purposes , th e rational e fo r doin g s o woul dsugges t

tha t 1 0 year s i s likewis e appropriat e for

trackin g futur e actua l emission s after

achange

. Accordingly , th e Agenc y requeste d commen t o n extendin g and/o r strengthenin g th e existin g 5-yea r trackin g requiremen t

for futur e actua l emissions

. Se e id. at

38268

. On e particula r

circumstanc e wher e EP A ha s bee n dissatisfie dwit hth e WEPC O rul e i s i n th e exclusio n o f deman dgrowt hfro mprediction s o f utilit y units ' futur e actua l emissions

. Th e Agency' s promulgatio n of th e WEPC O rul e represente dadepartur e fro mlongstandin g practic e unde r whic h emission s increase s tha t

followe dnon
routin e an dotherwis e nonexemp t change s a t

asourc e wer e presume dt o resul t fro mth e change

. A t

th e time , EP

A believe dtha t

ther e wa s awa y t o disassociat e utilit y units ' post-chang e emissio n increase s whic hwoul dhav e otherwis e occurre ddu e t o deman d growtha s apurel y independen t facto r fro mthos e tha t

resulte ddirectl y fro m th e physica l o r

operationa l change

. Th e EP A ha s reconsidere dtha t

departure , an dha s tentativel y conclude dtha t it s 199 2 departur e i s no t

appropriat e an d shoul dno t

b e continued , bot ha s a genera l matte r

an despeciall y i n vie w o f recen t development s i n th e electri c powe r sector

. Th e EPA' s experienc e lead s t o th e conclusio n tha t

source s generall y mak e non-routin e physica l o r

operationa l change s whic h ar e substantia l enoug h tha t the y migh t

trigge r NS Ri n orde r

t o increas e reliability , lowe r operatin g costs , o r improv e operationa l characteristic s o f

th e uni t an dd o s o i n orde r tha t the y ma y improv e thei r marke t position

. A proximat e caus e fo r makin g suc hchange s ma y b e t o respon d t o increase ddemand , o r

t o mor e efficientl y compet e for

shar e of amarke t tha t ha s flat , o r

eve n decreasing , demand

. Fo r

thes e reasons , EPA no w seriousl y question s whethe r marke t deman dshoul deve r

b e viewe da s a significan t

facto r i n answerin g th e relevan t regulator y questio n of

whethe r a n emission s increas e result s fro ma physica l o r

operationa l chang e at

a n existin g source , sinc e i n amarke t economy , al l change s i n utilization — an dhence , emissions—migh t b e characterize da s arespons e t o marke t demand

. Accordingly , aconclusio n tha t a n emission s increas e a t aplan t i s i n respons e t o marke t

deman ddoe s littl e t o determin e whethe r

th e increas e result s fro machang e a t

th e plant ; a n affirmativ e answe r t o th e firs t

questio n i s consisten t

wit h a n affirmativ e answe r t o th e latter

. Th e generatio n o f

electricit y i s currentl y bein g transforme dfro ma highl y regulate dmonopol y t o a competitiv e market

. Mor e tha n adoze n state s ar e implementin g retai l electricit y competitio n wher e consumer s ma y choos e thei r

electricit y supplier , an d mos t remainin g state s hav e suc h policie s unde r

consideration

. Moreover , th e Administratio n i n Marc h 199 8 propose daComprehensiv e Electricit y Competitio n Pla n i n orde r t o facilitat e mor e competitiv e electricit y market s an dsevera l simila r

proposal s hav e bee n introduce di n Congress

. A s th e electricit y industr y i s restructured , generatio n plannin g decision s wil l b e mad e no t b y stat e publi c utilit y commissions , bu t b y th e force s of acompetitiv e market

. Stat e utilit y regulator s ar e therefor e eliminatin g requirement s fo r electri c companie s t o repor t

generation-relate d informatio n suc h a s projection s o f futur e capacit y utilization

. Consequently , wit hrespec t t o th e electri c powe r

industr y i n particular , eve n acceptin g th e viabilit y o f th e 199 2 decisionmakin g framework , attemptin g t o discer n whethe r

increase dutilizatio n an demission s shoul db e attribute dt o physica l o r

operationa l change s versu s purel y independen t

demand-satisfyin g increase dcapacit y utilizatio n wil l b e muc h mor e difficul t

i n th e future , a s restructurin g i n th e electri c powe r industr y allow s electri c generatin g companie s t o compet e fo r retai l customers

. A s aresult , th e marketplac e wil l driv e electri c generator s t o functio n a s an y othe r

consumer-drive n industry , tha t is , t o ensur e thei r

abilit y t o suppl y th e marke t

an dcollaterall y t o increas e thei r revenues
. I n addition , a s utilitie s respon dt o acompetitiv e marke t for th e generatio n of

electri c powe r

the y ca n n o longe r b e expecte dt o accuratel y predic t thei r leve l of operation s an dpost

chang e emissions

. Eac h physica l o r operationa l chang e tha t

make s i t possibl e for

asourc e t o efficientl y increas e it s leve l o f

utilization , then , wil l likel y b e pursue dan dturne dint o electricit y for

sale

. On e ca n therefor e predic t tha t an y physica l o r

operationa l chang e wil l resul t

i n a n emission s increas e t o th e exten t

tha t ther e i s marke t deman dfor

additiona l power
. Fo r th e sam e reaso n tha t

th e deman d growt hexclusio n woul dignor e th e realitie s of

aderegulate delectri c powe r sector , EP

A believe s tha t

i t shoul dno t b e extende dt o non-utilit y units

. Fo r consumer-drive n industries , deman di s inextricabl y intertwine dwit h change s tha t improv e asource' s abilit y t o utiliz e

* ' I fP. 6

Federa l Register/Vol

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### 3986 1

it s capacity ; thus , i t

canno t b e sai dtha t deman dgrowt h i s a n "independen t factor, " separabl e fro magive n physica l o r operationa l change

. Modification s whic h affec t

operationa l characteristic s o f auni t ar e no t mad e withou t

reason , an dth e mos t

likel y reaso n for

a n economicall y competitiv e sourc e t o undertak e suc h change s i s t o enabl e i t t o creat e o r

respon dt o increase d demand. 5 I n short , ther e i s adirec t causa l lin k

betwee n mos t

physica l o r operationa l change s tha t enabl e asourc e t o us e existin g capacit y an dth e us e of suc h capacity

. I n addition , th e deman dgrowt h exclusio n i s problemati c becaus e i t i s self-implementin g an dself-policing

. Becaus e ther e i s n o specifi c tes t availabl e fo

r determinin g whethe r

a n emission s increas e indee dresult s fro m a n independen t

facto r suc ha s deman d growth , versu s factor s relatin g t o th e chang e a t th e unit , eac h compan y wit h autilit y uni t

presentl y adopt s it s ow n interpretation

. Interpretation s ma y var y fro msourc e t o source , a s wel l a s fro m wha t apermittin g agenc y woul daccep t a s appropriate

. Moreover , suc h companie s ar e no t

necessaril y require d t o provid e thei r

interpretatio n o

f deman dgrowth-relate demission s t o th e permittin g agency
. Thus , wit hminimal , if any , explanation , asourc e ma y merel y deduc t th e emission s increase s i t believe s ar e attributabl e t o deman d growt h fro mth e tota l emission s dat ait s supplie s t o th e permittin g agenc y demonstratin g tha t

i t i s belo w it s projecte dfutur e actuals

. Vestin g suc h unrestricte ddiscretio n i n th e regulate d entit y inevitabl y lead s t o enforcemen t problems

. Finally , th e deman dgrowt hexclusio n ma y mak e les s sens e i n th e nea r futur e i n vie w of

th e fac t that , a s propose di n th e NS RRefor

mpackage , th e Agenc y i s considerin g adoptin g aregulator y provisio n tha t

base s th e calculatio n of pre-chang e actua l emission s upo n a source' s highes t

capacit y utilizatio n i n th e pas t te n years
. I

f a n emissio n uni t undergoe s aphysica l o r

operationa l

'Th e EP A believe s thatth e rulemakin g recor d fo r NS RRefor m supports th e conclusio n tha tmarke t demand and sourc e modification s ar e highl y intertwined
. Industrial commenter s generall y wer e strongly supportive , forInstance , of th e concep to

f PAL's
. Man

y industrial interests argued tha tPAL's, becaus e the y allo w change s a texistin g facilitie s to occu rwithou tNS

Rs o lon g a s a

n emissio n cap i s maintained , ar

e neede d i n ordert o giv e companie s flexibilit y t o mak e physica l oroperational change s quickl y to maintai n oracquire acompetitiv e advantage i n a

n eve rchangin g global marketplace . Th e Agency believe s thatthes e claim s regarding PAL' s d o no tsupportth e argumentthatchange s a t facilitie s ar

e independen tfro

m marke tdemand . Rather , the y illustrate thatsource s frequently undertak e modification s t o enabl e the m bettert o compete I n a n ope n market

. change , o r i s affecte db y suc hchange , an dth e sourc e project s utilizatio n i n exces s of it s historica l hig h i n th e precedin g te n years , suc hutilizatio n i s likel y no t attributabl e t o marke t variabilit y (whic hi s accounte dfo r b y a 10-yea r baseline) , bu t

rathe r result s fro m th e chang e itself

. C. NSR Applicability Test for All Major Modifications 1

. I n Genera l Th e EPA i s presentl y considering , an d b y thi s Notic e i s seekin g commen t upon , amendin g th e curren t

applicabilit y tes t fo r modification s of

electri c stea m generatin g unit s an dextendin g i t t o al l sourc e categories

. Specifically , th e majo r modificatio n applicabilit y methodolog y woul db e t o retai n th e actual-to-future-actua l componen t for utilit y unit s an dappl y i t t o al l sourc e categories , t o mak e enforceabl e fo r a10

- yea r perio demission s level s use db y th e sourc e i n projectin g futur e actua l emission s fo

r al l sourc e categories , an d eliminat e th e deman dgrowt hexclusio n for al l sourc e categories

. Th e wa y tha t

th e methodolog y woul d work i n practic e i s tha t

owner s o r operator s of

unit s whic hunderg o anon
routin e physica l o r

operationa l chang e wil l determin e th e applicabilit y o f NS R solel y b y referenc e t o actua l emissions

. First , owner s o r

operator s mus t determin e whic hemission s unit s ar e bein g change do r

ma y b e affecte db y th e change , the n calculat e eac hunit' s baselin e actua l emission s (EP A ha s propose dat

6 1 F R38258-6 0 t o allo w source s generall y t o se t

thei r baselin e i n relianc e o n th e highes t

emission s i n th e pas t te n year s adjuste dt o reflec t curren t emissio n factors)

. Second , post-chang e actua l emission s fro mth e affecte dunit s mus t b e forecast

. Th e su mo f

th e pre
chang e actua l emission s i s the n compare dt o th e su mof

th e post-chang e actua l emissions

. I

f th e differenc e betwee n thes e tw o figure s exceed s th e significanc e threshol dfor apollutant , majo r NS Ri s triggere d(unles s th e sourc e i s otherwis e abl e t o ne t th e chang e ou t

of review). 6 I

f th e differenc e i s les s tha n significant , th e sourc e avoid s majo r

NSR

. I n th e latte r

case , for eac huni t tha t i s change do r

affecte db y th e change , th e sourc e mus t incorporat e tha t unit' s futur e emission s projectio n int o atemporary , practicall y an dlegall y enforceabl e conditio n o f a preconstructio n permi t

(mos t likel y a mino r

NS Rpermit)

. Th e limi t

mus t appl y fo r at leas t 1 0 year s afte r

th e sourc e recommence s norma l operatio n of th e affecte dunit. 7 EP

A believe s tha t asourc e woul dno t

purposefull y modif

y auni t an dthe n no t

us e i t a t it s Intende d capacit y fo r

1 0 year s merel y t o avoi d majo r NS Rpermitting

. Therefore , EPA believe s 1 0 year s represent s arealisti c perio dfor

applyin g a n enforceabl e temporar y emissio n limit

. B y adherin g t o suc halimit , th e sourc e demonstrate s t o th e permittin g authorit y tha t th e physica l o r

operationa l chang e di dno t resul t i n asignifican t

emissio n increase

. Consequently , subsequen t t o th e expiratio n of

th e limit , EP

A wil l presum e tha t

an y increase s i n capacit y utilizatio n an demission s ar e no t th e resul t o f th e physica l o r

operationa l chang e tha t

necessitate dth e temporar y limit. 8 Finally , sourc e owner s o r operator s ma y no t

exclud e predicte d capacit y utilizatio n increase s du e t o deman dgrowt hfro mthei r prediction s of futur e emissions

. Underlyin g thi s ne w approac hi s a n attemp t t o mitigat e th e concern s raise d b y industr y tha t

th e actual-to-potentia l methodolog y unfairl y ignore s pas t operatio n of

auni t an dassume s tha t

i t wil l operat e at

ful l capacit y followin g a non-routin e change

. A t

th e sam e time , th e methodolog y addresse s environmenta l groups ' legitimat e claim s tha t source s wh o see k

t o avoi drevie w base do n projecte dactua l emission s mus t als o b e prepare dt o b e accountabl e fo r adherin g t o thos e projections

. Finally , th e tes t

recognize s tha t

i n a marke t economy , source s ofte n mak e physica l o r

operationa l change s i n orde r t o respon dt o marke t

force s and , consequently , ther e i s n o plausibl e distinctio n betwee n emission s increase s du e solel y t o deman dgrowt h a s a n independen t

facto r an dthos e change s a t asourc e tha t

respon dto , o r

creat e new , deman dgrowt hwhic hthe n resul t i n increase dcapacit y utilization

. Thi s temporar y emission s ca p approac h als o addres s certai n complianc e assuranc e an denforcemen t concerns
. Specifically , unde r th e curren t regulations , acompan y nee dno t discus s it s determinatio n tha t projecte d futur e emission s fro mautilit y uni t wil l b e belo w acertai n leve l wit h a permittin g agenc y prio r

t o undertakin g

6 Althoug h th e sourc e ma y stil l avoi d majo

rNS R by nettin g ou tof

review , th e actual-to-enforceable
future-actua

l tes twoul d no tappl y i n calculatin g th e Increas e fro

m th e propose d chang e oran y othe r emission s leve l fo

rus e i n th e nettin g analysis
. Pos t chang e emissions fornettin g purpose s woul d continu e t o equal potential emissions
. 7 Units tha thave atemporar

y limi tma

y subsequend y undergo o

rb e affected by a modification
. I

n suc h case s ane w temporar y limi t o f a tleas t1 0 years wil l nee d t o b e established
. 8 Thi s limi ti s solel y forth e purpos e o f demonstratin g tha

tth e physica l chang e orchang e i n th e metho d of

operatio n di d no tresul tI n a significan temissio n increase
. Th e Impositio n or expiratio n of

thi s limi tdoe s no treliev e th e sourc e o f it s obligatio n to compl y with al l requirements otherwis e applicabl e t o th e unit
. 

# 5P. 7



### 39862 Federa l Register/Vol
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th e modification

. Rather , i t merel y need s t o suppl y "information " demonstratin g tha t

th e futur e actua l emission s di dno t

excee dth e significanc e leve l fo r

th e 5-yea

r perio d followin g th e modification

. Thus , a permittin g agenc y i s unabl e t o determin e if

th e chang e wil l resul t

i n a n emission s increas e an drequir e amajo r NS Rpermi t

befor e constructio n a t

th e utilit y unit ; i t

ca n onl y examin e dat a submitte dafter-the-fac t

b y th e source
. Th e NS Rprogram , however , i s apre
constructio n progra mtha t require s a n applicabilit y determinatio n prio r t o commencin g constructio n t o avoi d equity-in-the-groun dissue s an d retroactiv e contro l technolog y costs

. 2

. Limitation s o n Methodolog y an d Solicitatio n o f

Comment s It i s importan t

t o recogniz e th e limite dnatur e o f

th e propose d methodology

. Th e actual-to-enforceable

future-actua l tes t

woul dno t

appl y whe n determinin g a n emissio n leve l (i.e. , increas e o r

decrease ) fo r

us e i n anettin g analysi s o r

fo r th e purpos e of

complyin g wit h an y majo r

NS Rpermittin g requirement , suc h a s BACT , LAER , offset s o r a n ambien t

ai r impac t analysis

. Specifically , th e tes t woul d appl y onl y t o modification s t o existin g unit s for th e sol e purpos e of determinin g if

apropose dchang e t o tha t unit , o r achang e a t

th e facilit y whic h otherwis e woul daffec t

th e unit , wil l resul t i n a n emission s increas e a t th e source
. Ne w unit s hav e n o operatin g histor y upo n whic h areliabl e predictio n of futur e utilizatio n ca n b e made

. Thus , unde r th e regulations , suc h unit s hav e no t "begu n norma l operations, " an d permittin g authoritie s mus t asses s NS R applicabilit y base do n th e ne w unit' s potentia l emissions

. I n addition , th e Agenc y seek s commen t

o n th e appropriatenes s o f

applyin g a n actual

to-enforceable-future-actua l tes t wher e a physica l o r

operationa l chang e increase s th e desig n capacit y o r

PTE o f agive n unit

. Suc h change s resul t i n alternativ e mode s of operatio n (an demission s levels ) whic h ar e no t

currentl y achievabl e i n practic e fo r th e unit

. I n suc h circumstances , th e unit' s pas t utilizatio n arguabl y i s apoo r prox y for it s futur e operatio n and , therefore , "norma l operations " ar e impossibl e t o identify

. Furthermore , emission s level s whic h ca n no t

b e achieve di n practic e bu t for aphysica l o r

operatio n chang e ar e clearl y connecte dt o th e change

. Consequently , th e Agenc y i s seekin g commen t o n whethe r

an y increas e i n emission s resultin g fro mamod e o f operatio n whic h coul donl y hav e bee n achieve dthroug h aphysica l o r operationa l chang e mus t b e presume dt o hav e resulte dfro mth e change , eve n if

suc h increas e wer e t o occu r late r tha n te n year s after

th e change

. IV . Adjustment s o f

PAL' s A. Background 1

. Introductio n I n th e Jul y 23 , 199 6 Refor mpackage

. EP A propose dane w metho dfor determinin g majo r

NS Rapplicabilit y for existin g source s i n attainmen t o r unclassifiabl e area s an dexistin g an d propose dsource s i n nonattainmen t areas
. Unde r

thi s proposal , a n existin g majo r source , if

th e State' s SI P provides , may appl y for

apermi t whic h base s th e source' s majo r

NS Rapplicabilit y o n a pollutant-specifi c plantwid e emission s cap , terme daPAL

. Th e EPA propose d tha t afacility' s allowabl e emission s unde r aPA Lwoul dgenerall y b e base d o n plantwid e "actua l emissions" , a s tha t ter mwoul db e define dunde r th e proposal , plu s a n additiona l amoun t o f emission s les s tha n th e applicabl e significan t

emission s rate

. Th e voluntary 9 source-specifi c PA L i s a straightforward , flexibl e approac ht o determinin g whethe r

change s at

existin g majo r stationar y source s resul t i n emission s increase s whic h trigge r majo r NSR

. S o lon g a s sourc e activitie s d o no t resul t i n emission s abov e th e ca p level , th e sourc e wil l no t

b e subjec t

t o majo r NSR

. I t als o contain s propose d regulator y languag e for

PAL' s for

th e PS D rule s at

4 0 CF R51.16 6 an d52.21 , an dth e nonattainmen t

NS Rrule s a t 51.165

. Th e Jul y 23 , 199 6 proposa l contain s athoroug hdiscussio n of th e propose dPA

L concep t

an dth e backgroun dinformatio n use dt o develo p th e proposal

. B. PAL Advantages Th e EP A ha s determine dtha t

th e voluntar y source-specifi c PALi s a practica l metho dt o provid e bot h flexibilit y an dregulator y certaint y t o man y existin g sources , a s wel l a s benefit s t o permittin g authorities , whil e maintainin g ai r

quality

. Fo r

example , PAL' s provid e th e abilit y t o mak e timel y change s t o reac t

t o marke t

demand , certaint y regardin g th e leve l o f emission s a t

whic hastationar y sourc e wil l b e require dt o underg o majo r NSR , an dadecrease dpermittin g burde n for th e sourc e an dth e permittin g authority

. I n addition , becaus e asourc e wit ha PA L wil l hav e mor e flexibilit y t o mak e reduction s t o creat e roo mfor growth , PAL' s shoul dlea dt o innovativ e contro l technologies , pollutio n preventio n an d emission s reduction s concurren t wit h economi c expansion

. C

. PAL Adjustment

Issues Th e EPA propose dtha t

PAL's , onc e include di n apermit , ma y b e adjuste d for anumbe r

of reasons
. I n particular , th e Agenc y solicite d"commen t o n why , how , an dwhe n aPA L shoul db e lowere do r

increase dwithou t

bein g subjec t t o majo r NSR. " 6 1 F

Ra t 38266

. Moreover , th e rul e languag e permittin g PAL' s provide s fo r

periodi c adjustmen t t o reflect , amon g othe r

things , "appropriat e considerations. " Se e id. a t 38327

. Th e nee dfo r

adjustment s woul daris e i n anumbe r

o f scenarios : (1 ) Wher e technica l error s hav e bee n made ; (2 ) whe n ne w requirement s appl y t o th e PA Lpollutant , suc ha s RACT , NSP S o r SIP-require dreductions; 1 0 (3 ) wher e emission s reduction s belo w PA Llevel s ar e use dfo r

offsets ; (4) for

permanen t shutdown s wher e th e Stat e ha s th e authorit y t o remov e permanen t shutdown s fro mth e emission s inventor y afte r

acertai n tim e period ; an d(5 ) whe n an y change s (thoug h consisten t

wit h th e PAL) migh t

caus e o r contribut e t o aviolatio n o f an y NAAQ S o r PS D incremen t

o r woul dhav e a n advers e impac t

o n ai r qualit y relate d values

. Th e EPA receive dman y comment s regardin g th e appropriat e consideration s for PAL adjustment

. Base do n thes e comment s an dfurthe r

deliberation , EP

A i s considerin g whethe r

i t i s appropriat e t o reevaluat e PALlevel s an dadjus t the mt o reflec t

actua l emission s t o addres s lega l concern s associate dwit h th e Court' s decisio n i n Alabama Power Co. v Costle, 63 6 F.2 d32 3 (D.C

. Cir

. 1979 ) an dbecaus e o f

environmenta l polic y reasons
. 1

. Legal Concern s A s stated , wher e afacilit y wit h aPA L add s ane w emittin g uni t o r modifie s a n

9 Thl s Notic e use s th e ter m "voluntary " to mean no trequired b

y th e regulation s oraSIP, rathe rthan no tenforceabl e by aState , local , orFedera l agency o rth e public
. 1 0 I n th e July 1996 NSRRefor m package , EP

A propose d thatemission s reduction s o f HA Pto meet MAC T a temission s unit s unde raPA L woul d generall y no tnecessitat e adownwar d adjustmentto th e PA L becaus e th e PA

L i s no tdesigne d to limi t HAP
. However , i

f MAC T reduction s ar

e relie d o n i n th e SI P(e.g. , VO

C reduction s i n nonattainmen t area s use d forRF

Porattainmentdemonstrations ) the n th e PA

L rule s woul d requir

e adjustment downward . Thi s positio n i s consisten twit h EPA' s polic y thatemissions reduction s fro m meetin g MAC T requirement

s ar e generall y no tpreclude d fro m bein g creditabl e forNSRnettin g provide d th e reduction s ar

e otherwis e creditabl e unde rmajo r NSR
. Th e EP A I s concerne d thatthe benefits of HA Preduction s to mee tMACT a tunit s unde rth e PA L ma y b e diminishe d sinc e th e HA Preductio n ma y b e use d indefinitely , ratherthan forashorter contemporaneou s tim e period , to ad d ne w or modifie d unit s unde rth e PAL
. Therefore , EP A I s seekin g additional commen to n th e proposal t o not adjus tPAL' s forMAC

T purposes . 

# bP. 8

Federa l Register/Vol

. 63 , No

. 142/Friday , Jul y 24 , 1998/Notice s 

### 3986 3

existin g unit , th e uni t

woul dno t underg o majo r

NS R(nonattainmen t

o r PSD) if th e PA L i s no t exceeded

. Tha t is , i f th e sourc e generate s sufficien t emissio n reductions , i t

ma y ad d equivalen t

emissio n increase s u p t o th e PA L leve l withou t

triggerin g NSR

. Unde r presen t regulations , asourc e tha t add s o r modifie s auni t

tha t woul d resul t i n asignifican t

emission s increas e ma y "net " tha t

particula r

chang e ou t

of revie w if th e ne w emissio n increas e plu s th e su mof

al l othe r contemporaneou s increase s an d decrease s elsewher e a t

th e sourc e ar e les s tha n significant

. Whe n th e nettin g calculu s i s triggere d(tha t is , ther e i s a significan t

emissio n increas e a s aresul t of th e additio n of

ane w uni t

o r th e modificatio n o f

a n existin g unit) , th e sourc e mus t

als o conside r

thos e emissio n increase s an ddecrease s tha t hav e occurre da t

th e facilit y durin g a "contemporaneous " period

. I n th e federa l PS D regulations , thi s perio di s 5 years
. Se e 4 0 CF

Rsectio n 52.21(b)(3)(ii)

. State s implementin g th e PS D progra m o r th e nonattainmen t

progra munde r

a n EPA-approve dSI P ma y defin e a differen t reasonabl e contemporaneou s period

. Th e curren t

regulations ' requiremen t of contemporaneit y derive s fro mth e interpretatio n o f

th e Act' s provision s governin g modification s se t forth i n Alabama Power

Co. v
. Costle. I n tha t case , th e cour t

hel dtha t EPA' s 197 8 regulation s limitin g nettin g t o ales s tha n plantwid e scop e conflicte dwit h th e languag e an dpurpos e of th e Ac t an d rule dtha t

EP A mus t permi t source s t o ne t o n aplantwid e basis

. Accordin g t o th e court , plantwid e nettin g wa s implici t i n th e statutor y ter m "modification " an dth e purpose s o f th e Act

. A t th e sam e tim e tha t

i t require d EP A t o expan dth e scop e o f th e nettin g concept , th e cour t

als o interprete dth e statut e a s imposin g alimi t o n plantwid e netting : contemporaneity

. Th e cour t stated , "[t]h e Agenc y retain s substantia l discretio n i n applyin g th e bubbl e concept

. First , an y offse t change s claime db y industr y mus t b e substantiall y contemporaneous

. Th e Agenc y ha s discretion , withi n reason , t o defin e whic h change s ar e substantiall y contemporaneous. " Id. a t 402 ; se e als o id. a t 40 3 ("Wher e ther e i s n o ne t increas e fro mcontemporaneou s change s withi n asource , w e hol dtha t PS D review , whethe r

procedura l o r substantive , canno t

apply.")

. Thereafter , EP A codifie dcontemporaneit y a s a regulator y requirement

. See 4 5 F R 52676

. 52700-0 2 (Augus t 7 , 1980)

. A s stated , EPA solicite dcommen t o n wha t "appropriat e considerations " migh t necessitat e revision s t o th e PA L allowabl e level

. Havin g agai n reviewe d Alabama Power

an dth e Agency' s subsequen t

interpretation s of

th e case , th e Agenc y i s concerne dthat , becaus e PAL' s may b e characterize da s afor mof nettin g an dresul t

i n th e avoidanc e of majo r NSR , th e contemporaneit y requiremen t

fo r nettin g se t

forthi n Alabama Power

ma y als o nee dt o b e applie dt o PAL's

. Therefore , EP A i s solicitin g commen t

o n whethe r

an d whe n t o provid e fo r

subsequen t adjustmen t

of PAL' s t o addres s contemporaneit y issue s associate dwit h Alabama Power. 2

. Environmenta l Concern s Severa l commenter s encourage dth e Agenc y t o provid e for

periodi c revisio n t o th e PA Lallowabl e leve l t o reflec t a source' s actua l emission s i n recen t years
. I n th e main , thes e commenter s represente dStat e pollutio n contro l agencies , th e entitie s whic h wil l b e charge dwit h implementin g individua l PAL's

. See , e.g. , comment s IV-D-5 2 an d -137

. Base do n thes e comment s an d interna l deliberations , th e Agenc y i s considerin g severa l option s tha t woul d provid e for

periodi c reevaluatio n of PA L level s t o ensur e tha t

the y reflec t

actua l emission s an dmaintai n o r enhanc e environmenta l protection

. Unde r th e curren t

majo r NS R regulations , emission s decrease s ar e creditabl e onl y if

the y ar e contemporaneou s wit h aprospectiv e modificatio n projec t

tha t would , standin g alone , increas e emission s at th e source
. Th e EPA i s solicitin g commen t o n whethe r

th e PA L alternativ e t o traditiona l majo r NS R applicabilit y ca n achiev e equivalen t o r bette r environmenta l results , whil e employin g adifferen t

approach

. Th e EP A believe s tha t

ther e ar e a numbe r o f polic y reason s wh y th e fina l PA L rule s migh t

provid e for

periodi c reassessmen t

an dadjustmen t

of PA L levels

. First , a s agenera l matter , aPA L operate s a s aformof

allowable-to

allowabl e test , insofar

a s asourc e ma y avoi dmajo r

NS Rrevie w if

it s emission s after aparticula r

constructio n activit y d o no t excee dth e pre-chang e allowables

. O f

course , unde r

th e propose drule s PAL' s woul densur e tha t th e allowabl e emission s ar e base do n histori c actua l emissions

. Nevertheless , a s a n allowable-to-allowabl e scheme , PAL' s rais e som e o f

th e sam e concern s a s di dth e CMA Exhibi t

B tes t discusse d i n th e NS RRefor

mpreamble

. Specifically , absen t

arequiremen t

fo r periodi c adjustmen t

th e PA L woul d allo w asourc e t o indefinitel y keep , rathe r tha n eventuall y forfei t

t o th e environment , emissio n reduction s a t th e source , suc h a s thos e achieve db y th e replacemen t o f existing , an dofte n higher-polluting , equipmen t wit h mor e efficient , an dthu s lower-polluting , equipment

. Second , arul e whic h provide s for th e periodi c revie w o f

PAL' s ma y ensur e tha t individua l source s d o no t indefinitel y retai n unuse demission s credit s t o th e detrimen t

of othe r source s i n th e are awishin g t o us e them

. Fo r example , wher e aStat e treat s sources ' PAL allowabl e level s a s "actual " emissions , arul e whic h i n som e instance s require s adownwar d adjustmen t

o f PAL' s wil l therefor e reduc e th e area' s inventor y o f actua l emissions

. Suc hadjustment s woul d "fre e up " aportio n o f

th e PS D increment s i n attainmen t area s for us e b y othe r source s i n th e area
. Third , a n indefinit e PA

L ma y hinde r aState' s abilit y t o pla n effectivel y for attainment

. If

aStat e doe s it s attainmen t plannin g base dexclusivel y o n source' s actua l emission s t o th e atmosphere , an d doe s no t trea t aPA L allowabl e limi t

a s th e PAL source' s "actual " emissions , the n a n emissio n credi t

create dlon g i n th e pas t ma y reappea r

i n th e futur e a s rea l emission s t o th e air , withou t bein g par t o f th e State' s attainmen t

planning

. Fo r example , if

aPAL-covere dsourc e replace s a n oi l boile r

toda y wit h amor e moder n an defficien t

ga s turbin e an dth e State , i n it s nex t

inventory , calculate s th e source' s emission s a t th e ne w lowe r level , the n base s it s attainmen t plannin g o n th e assumptio n tha t

th e sourc e wil l continu e t o emi t

a t th e lowe r

level , th e Stat e ma y no t

mee t it s attainmen t

goal s (or , perhaps , fal l ou t

o f attainment ) if th e PAL sourc e decide s t o utiliz e it s ful l PA Lallowabl e a t

som e poin t

i n th e future

. V

. PALRevie w an dAdjustmen t Option s Th e EPA i s seekin g commen t o n ho w th e PALconcep t

ca n b e reconcile dwit h th e lega l an denvironmenta l polic y concern s articulate dabove

. Specifically , th e Agenc y solicit s inpu t o n th e usefulnes s o f

anumbe r

o f differen t option s for

periodicall y reviewin g PA L allowabl e level s an do n whethe r suc h option s adequatel y addres s th e lega l issue s associate dwit hAlabama Power an denvironmenta l concern s pose db y th e long-ter mretentio n of unuse d allowabl e emissions

. It shoul db e note dtha t

EP A ha s no t mad e afina l decisio n o n th e frequenc y o f apermittin g authority' s revie w o f a PA Lo r th e methodolog y use dt o establis h aPALbaseline

. Th e Agenc y i s givin g seriou s though t

t o 1 0 year s a s a n approach

. Therefore , th e option s discusse di n thi s Notic e assum e aPA L wit hater mof

1 0 year s wit h th e PA

L baselin e establishe dusin g th e highes t 1 

# 7P. 9



### 3986 4 Federa l Register/Vol
. 63 , No

. 142/Friday , Jul y 24 , 1998/Notice s

yea r i n th e las t

te n year s of

historica l emission s for

th e source
. Th e Agenc y solicit s commen t

o n th e appropriatenes s o f reviewin g PAL level s ever y 1 0 year s an dwhethe r

anothe r perio di s mor e reasonable

. Th e EP A i s considerin g severa l option s t o periodicall y revisi t th e appropriat e PAL emissio n level

. First , permittin g authoritie s ma y adjus t th e PA L t o accoun t

fo r emission s reduction s fro mpermitte dunit s unde r th e PA Ltha t ar e shutdow n o r

dismantle dan dth e associate demissio n reduction s remai n unuse dfor

aperio do f

a t leas t 1 0 years
. Second , th e PAL ma y b e reevaluate dt o accoun t fo r emission s reduction s wher e a n emission s uni t

unde r th e PA L operate dfo

r a t leas t 1 0 year s belo w th e capacit y leve l fo r

tha t uni t whic hwa s use dt o establis h th e previou s PA L level

. Third , th e Agenc y i s considerin g a n optio n tha t

woul drequir e PAL' s t o expir e after

1 0 year s o r

b e renewe dt o reflec t curren t actua l emissions

. Finally , EP A i s solicitin g commen t

o n whethe r i t i s appropriat e t o adjus t

aPA L downwar da t

al l wher e al l o f

th e emissio n unit s subjec t

t o th e PA

Lhav e goo dcontrol s alread y i n plac e (i.e. , BACT , LAER

) o r wher e asourc e voluntaril y implemente dpollutio n preventio n strategie s whic hresulte di n emission s reductions

. Th e followin g discussio n set s forth additiona l informatio n o n eac h o f

th e PA L adjustmen t

options

. A. PAL Adjustments for

Shutdown or Dismantled

Units Th e firs t situatio n i n whic ha downwar dPAL adjustmen t migh t b e warrante di s wher e emissio n reduction s resulte dfromemissio n unit s unde r th e PA L tha t wer e shutdow n o r

dismantled

. A shutdow n uni t

woul db e on e tha t

th e sourc e di dno t

operat e a t

al l durin g th e 10-yea r lif e of th e existin g PAL

. A dismantle duni t

woul db e on e tha t

wa s remove dprio r

t o th e establishmen t

of th e curren t

PAL leve l an dth e emission s capacit y associate dwit hsuc h uni t wa s no t use db y th e sourc e fo r

te n years
. Thus , th e PA

L leve l woul db e adjuste d t o remov e onl y thos e emission s tha t coul dhav e potentiall y bee n emitte d fro man y shutdow n o r

dismantle dunits

. Th e PA L woul dno t

b e adjuste d downwar dif

th e sourc e ha dutilize d thos e emissio n reduction s fro mth e shutdow n o r

dismantle dunit s elsewher e a t

th e sourc e (e.g. , adde dne w unit s o r capacit y o r

increase dcapacit y utilizatio n a t

existin g units ) durin g th e perio dsinc e th e uni t

shu t dow n o r wa s removed

. No r

woul dth e PALb e adjuste ddownwar ddu e t o underutilizatio n o f

an y unit s stil l i n operatio n t o an y exten t

unde r th e PAL

. Fo r

example , a n initia l PALse t i n th e yea r 200 0 include s 600 tp y of VO C fro m uni t A ; uni t A i s shutdow n i n 2005

. Periodi c revie w occur s i n 2010

. I n 2010 , becaus e uni t

A wa s use ddurin g th e te n year s prio r

t o readjustment , th e adjuste d PA L leve l woul dassum e tha t uni t A wa s stil l operating

. I

f b y 2020 , th e nex t periodi c review , th e 600 tp y o f emission s associate dwit h th e shutdow n wa s no t use db y th e sourc e t o mak e changes , th e PA

Lleve l woul db e adjuste ddownwar db y 600 tpy

. However , if

betwee n 201 0 an d202 0 th e sourc e use daportio n of

th e shutdow n emission s t o ad dne w unit s o r mak e modification s unde r

th e PAL , the n th e PA L woul db e adjuste ddownwar donl y for th e emission s tha t

remai n unused

. Th e EPA believe s tha t

th e periodi c downwar dadjustmen t

o f PAL' s for

th e failur e t o us e emission s associate dwit h shutdow n o r

dismantle dunit s i s appropriat e for

ai r qualit y plannin g purposes
. However , EP

A i s concerne d tha t i t ma y b e difficult

t o determin e whethe r a n emission s increas e unde r th e PAL relie dupo n previou s decrease s a t ashutdow n o r

dismantle duni t

a s oppose dt o othe r

activitie s at

th e source
. Th e Agenc y solicit s commen t o n whethe r limitin g th e PA

Ladjustmen t

t o th e situatio n o f

shutdow n o r

dismantle d unit s addresse s th e lega l an dpolic y concern s raise dabov e an dwelcome s comment s an dsuggestion s o n ho w t o implemen t

a n adjustmen t

optio n tha t woul dadjus t

downwar donl y fo

r thos e emission s fro mshutdow n o r dismantle d unit s whic h th e sourc e faile dt o utiliz e for 1 0 years
. B. PAL Adjustments for

Unused Capacity Th e EPA i s als o considerin g periodi c adjustment s t o aPAL wher e th e emission s unit s unde r

th e PALoperat e for aperio dof

te n year s belo w th e capacit y use dinitiall y t o establis h th e PAL

. Th e adjustmen t

woul db e base do n arevie w of

th e utilizatio n of

al l emissio n unit s use dt o establis h th e PA L baseline , no t

jus t thos e tha t

wer e shutdow n o r

dismantled

. Unde r

thi s option , an di n th e exampl e below , PA L adjustmen t

woul db e base do n th e highes t capacit y utilizatio n of

eac huni t durin g an y 1 2 mont h perio di n th e pas t 1 0 years
. Alternatively , EPA als o solicit s commen t o n whethe r

th e PA L adjustmen t

shoul db e base do n th e highes t capacit y utilizatio n a t

th e entir e sourc e durin g asingl e 12-monthperio d withi n th e pas t

1 0 years
. Th e followin g exampl e illustrate s ho w a n initia l revie w o f

th e PA Lan d subsequen t

adjustment s t o th e PA

L coul db e handle dunde r

thi s option

. A s a n example , uni t

A ha doperate da t

8 0 percen t

durin g a12-mont h perio di n th e te n year s prio r

t o initia l PA L establishmen t

i n 2000

. I n 2005 , th e sourc e lower s uni t

A' s utilizatio n fro m 8 0 percen t

t o 5 percent

. A t

PALrevie w i n 2010 , becaus e uni t

A' s utilizatio n i n th e pas t te n year s (e.g. , 2004 ) ha d reache d8 0 percent , th e adjuste dPAL leve l woul dassum e acapacit y utilizatio n n o lowe r

tha n 8 0 percent

. Unde r th e alternativ e t o thi s optio n th e PAL adjustmen t

woul db e base do n th e highes t capacit y for

al l unit s a t

th e sourc e durin g asingl e 12-mont h perio d withi n th e pas t

1 0 years
. I

f yea r 200 5 i s chose n a s th e singl e 12-mont h perio d fo r capacit y revie w the n th e adjuste d PAL leve l fo r

uni t A woul dassum e a capacit y utilizatio n of

5 percent

. Wher e PAL' s ar e adjuste dbecaus e o f long-ter munderutilizatio n of capacity , EPA i s als o considerin g an dseekin g comment s o n th e followin g alternative s an dsafeguard s t o ensur e tha t a n operatin g cushio n exists : (1 ) Includin g i n th e adjuste dPA

L leve l a n operatin g cushio n tha t

equal s afixe dpercentag e (e.g. , 1 0 percent

. 1 5 percent , o r 2 0 percent ) o f

th e curren t

PAL , provide d th e adjuste dPALleve l doe s no t excee d th e curren t

PALlevel ; (2

) requirin g n o PAL adjustmen t

du e t o underutilizatio n o f capacit y i f

th e emission s unde r

th e PAL ar e withi n afixe dpercentag e (e.g. , 1 0 percent , 1 5 percen t

o r 2 0 percent ) of th e curren t

PA Lbaseline ; (3 ) adjustin g th e PALdownwar dfor

unuse dcapacity , bu t limi t th e potentia l downwar dPA L adjustmen t

t o afixe dpercentag e (e.g. , 1 0 percent ) o f

th e curren t

PAL level ; an d(4 ) re-settin g th e PA La s thoug h i t wer e bein g se t

initiall y (e.g. , plantwid e actua l emission s plu s a n operatin g margi n lowe r

tha n th e applicabl e significanc e threshold)

. Th e Agenc y seek s commen t

o n whethe r

thes e safeguards , if

include di n th e fina l regulations , woul dbot h preserv e sources ' operationa l flexibilit y an d addres s th e specifi c lega l an dpolic y concern s raise dabove

. C

. Capacity Adjustments for PAL Expiration and

Renewal Th e EPA i s seekin g commen t o n a n optio n wher e th e PALexpire s a s amajo r NS Rapplicabilit y tes t

fo r subsequen t ne w unit s o r

subsequen t

modification s unles s th e sourc e decide s t o rene w th e PAL

. Unde r

thi s option , aPALwoul d expir e afte r

te n years
. Whe n i t

expires , th e PA Lcease s t o serv e a s th e emission s baselin e agains t

whic hal l sourc e addition s an dmodification s ar e measure dfor

purpose s o f

majo r NS R applicability

. Instead , asourc e mus t rever t t o th e traditiona l nettin g analysi s t o determin e majo r

NS Rapplicabilit y for ne w o r modifie dunits

. 

# ffP.1 0



### Federal Register/Vol

. 63 , No

. 142/Friday , July 24 , 1998/Notice s 3986 5

A t th e tim e o f

PA Lexpiration , th e sourc e woul dchoos e eithe r t o re
establis h th e PA

Lfor th e entir e facility afte r th e expiratio n o f

th e initia l 10-yea

r termo r t o allo w i t

t o expire

. Th e sourc e coul dals o re-establis haPA La t som e late r date

. I f th e renewa l optio n i s chose n b y th e source , th e PA Lbaselin e woul db e adjuste dt o reflec t actua l operatin g condition s an demission s fo r th e 1 0 year s prio r

t o renewal , consisten t wit h th e procedure s for

settin g aPAL

. I f th e sourc e elect s no t

t o rene w th e PAL , the n subsequen t

ne w unit s an d subsequen t

modification s ar e subjec t t o th e traditiona l nettin g analysi s t o determin e majo r

NS Rapplicabilit y fo

r thos e units

. I n addition , wher e th e sourc e elect s no t

t o rene w th e PA

L for major NS Rapplicabilit y purposes , th e former PA L allowabl e limi t

woul dstil l remai n i n effec t

a s a n enforceabl e limi t o n tota l allowabl e emission s fo r thos e unit s previousl y covere dunde r th e PAL , notwithstandin g it s expiratio n a s a n applicabilit y test

. Th e unit s previousl y subjec t t o th e PA L woul dremai n fre e t o increas e emission s u p t o th e forme r allowabl e PA L level , provide dth e increas e i s no t th e resul t o f aphysica l o r

operationa l chang e a t th e source
. Th e sourc e retain s th e optio n to ; (1 ) Reestablis ha n expire d PA L t o avoi dmajo r

NS Rfor an y subsequen t

physica l o r

operationa l chang e a t th e sourc e tha t

i s consisten t wit h th e reestablishe dPALlevel , o r (2 ) no t t o reestablis h th e PAL for th e facilit y an dproces s an y ne w uni t a s a modificatio n unde r

th e traditiona l majo r NS Rapplicabilit y criteri at o determin e if asignifican t

ne t emission s increas e wil l result

. I n th e latte r

case , emission s increase s an ddecrease s whic hhav e occurre ddurin g th e ter mo f th e PAL a s a n applicabilit y trigge r

woul dno t

coun t fo r nettin g purposes
. A s a n example , assum e tha t i n th e yea r 200 0 asourc e wit hfiv e unit s establishe s aPA L o f

100 0 tp y o f pollutan t X base do n actua l operation s an demission s fro mth e prio r 1 0 years
. Durin g th e perio dfro m2000-201 0 th e sourc e modifie s thre e existin g unit s an d construct s tw o ne w unit s (Unit s 6 an d 7) , bu t withi n thos e 1 0 year s operate s th e facilit y s o a s onl y t o emi t 70 0 ton s of X pe r year
. I n 2010 , th e PAL (a s a n alternativ e applicabilit y tes t fo r majo r NSR ) mus t expire

. I f th e sourc e choose s t o re-establis h th e PAL , base do n th e las t 1 0 year s o f

actua l operatin g dat ath e PA L baselin e woul db e adjuste d downwar dt o reflec t

th e 700 tp y level

. Th e sourc e coul dchoos e t o continu e th e PA L a t the adjuste d70 0 tp y level , o r le t th e curren t

PA L laps e for

applicabilit y purposes
. I

f th e sourc e let s th e PAL lapse , th e origina l 100 0 tp y ca p woul d stil l remai n fo r Unit s 1- 7 t o ensur e tha t physica l an doperationa l change s whic h occurre ddurin g th e lif

e of th e PA Ld o no t resul t i n actua l emissio n increase s tha t excee dth e 100 0 tp y ca p withou t bein g subjec t

t o majo r NSR

. Suppos e furthe r

tha t th e PA L i s no t renewe dan dtha t

i n 2014 , th e actua l plantwid e emission s o f

pollutan t

X wer e 80 0 tpy , th e highes t

actua l emission s leve l fo r th e previou s te n year s an dthat , i n 2015 , th e sourc e propose s t o construc t ane w Uni t

8 tha t emit s 20 0 tp y of pollutan t X

. Ne w Uni t

8 woul d otherwis e b e subjec t

t o th e traditiona l majo r NS Rapplicabilit y test

. Th e previou s 100 0 tp y PA Llapse di n 201 0 an dcanno t

includ e ne w unit s sinc e 2010

. A s a n alternative , th e sourc e ma y avoi dmajor

NS Rfo r th e ne w uni t

b y establishin g ane w PA

Lat 80 0 tp y an d includ e th e ne w uni t

consisten t

wit h th e newl y establishe d80 0 tp y limit

. I n addition , onc e th e PA

Llimi t expire s a s amajo r NS Rapplicabilit y limi t complianc e wit h th e PA

La s a n allowabl e limi t

woul dstil l b e required

. Th e EP A believe s tha t

th e foregoin g optio n provide s sufficien t flexibilit y t o asourc e becaus e i t

maintain s th e abilit y o f th e sourc e t o operat e th e unit s previousl y covere dunde r th e PAL a t thei r ful l rate dcapacity

. Additionally , i t allow s asourc e t o ad dne w unit s after th e expiratio n of

th e PALi n accordanc e wit hth e traditiona l NS Rapplicabilit y determination , includin g th e establishmen t

of ane w PA

L a t suc h tim e a s i t ma y b e advantageou s t o th e sourc e t o d o so
. Nevertheless , EPA solicit s commen t

o n whethe r

thi s optio n sufficientl y addresse s th e lega l an d polic y concern s associate dwit h PA L adjustments

. D. PAL Adjustments Where Sources Implement

Good Controls or

Pollution Prevention Initiatives Th e EP A i s als o seekin g commen t o n whethe r i t i s appropriat e t o adjus t

aPAL downward , eve n wher e unuse dcapacit y exists , i f al l O f th e emission s unit s subjec t t o th e PA

Lalread y hav e goo d control s i n plac e (e.g , BACT , LAER) , th e sourc e ha s installe dinnovativ e controls , o r if th e sourc e create dth e emissio n reduction s usin g pollutio n preventio n strategies

. Th e EPA believe s tha t source s whic h voluntaril y achiev e emission s reduction s throug hth e installatio n o f goo dand/o r

innovativ e control s throughou t

th e facilit y o r

throug h pollutio n preventio n initiative s shoul d b e encourage dt o d o so
. B y th e term s "good " control s an d"innovative " technolog y th e Agenc y i s referrin g t o th e type s of control s an dtechnolog y discusse dpreviousl y i n th e Jul y 199 6 NS RRefor

mproposa l fo

r th e "clea n unit " an d"clea n facility " exclusio n an d

undemonstrate dcontro l technology , respectively

. See 6 1 F

Rat 3825 5 an d 3828 1 (Jul y 23

. 1996)

. Additionally , th e type s o f pollutio n preventio n activitie s tha t woul dqualif

y ar e thos e consisten t wit h th e activitie s describe di n th e Jul y 199 6 proposa l an dpreviou s EP A policies

. I n ligh t

of th e Agency' s prio r guidanc e an ddiscussion s concernin g goo dcontrols , innovativ e technology , an dpollutio n preventio n initiatives , EPA seek s commen t

o n whethe r

th e term s "goo dcontrols" , "innovativ e controls" , an d"pollutio n preventio n initiatives " ar e appropriatel y use dan d clearl y define dfor

purpose s of

thi s option

. T o requir e aPA

Ladjustmen t

unde r thes e circumstance s coul dcreat e a disincentiv e t o engag e i n thes e initiatives

. However , thi s optio n raise s certai n enforcemen t

concern s for

th e Agency

. I n particular , withou t additiona l clarificatio n i t ma y b e difficul t t o determin e if

a n emission s uni t ha s goo dcontrols , utilize s innovativ e technology , o r ha s reduce d emission s becaus e o f

pollutio n preventio n initiatives , a s oppose dt o othe r factors

. Furthermore , EP A i s concerne dtha t

i f ther e i s ambiguit y abou t th e meanin g o f

thes e term s th e public , sources , an dpermittin g agencie s ma y disagre e abou t

whethe r PAL adjustmen t

i s needed

. Notwithstandin g th e Agency' s interes t

i n promotin g innovativ e an dvoluntar y pollutio n contro l an dpreventio n initiatives , EP A doe s no t believ e voluntar y emission s reduction s achieve dthroug hth e implementatio n o f

goo dcontrols , innovativ e technolog y an dpollutio n preventio n Initiative s shoul d necessaril y reliev e th e sourc e fro mothe r regulator y requirements

. Accordingly

. EPA seek s commen t

o n thes e concern s a s wel l a s th e type s o f

circumstance s tha t migh t b e appropriat e for

asourc e tha t engage s i n innovativ e an dpositiv e environmenta l stewardshi p t o avoi dan y downwar dadjustmen t

t o it s PAL

. Th e EPA als o solicit s comment s o n whethe r an dho w th e polic y an dlega l concern s se t forth i n thi s notic e concernin g PA L adjustment s fo

r source s whic h utiliz e innovativ e o r

goo dtechnolog y o r

engag e i n pollutio n preventio n initiative s coul d otherwis e b e addressed

. Finally , give n th e flexibilit y an d significan t

opportunitie s t o utiliz e emission s reduction s unde r th e option s describe di n thi s Notice

. EP A solicit s commen t o n whethe r

additiona l PA

L adjustmen t

consideration s ar e appropriate

.P.1 1



### 3986 6 Federa l Register/Vol
. 63 , No

. 142/Friday , Jul y 24 , 1998/Notice s
Dated : Jul y 16

. 1998

. RichardD

. Wilson , Acting Assistant

Administrator. [F RDoc

. 98-1983 2 File d7-23-98 ; 8:4 5 am ] BILLIN G COD E 6560-50- P
ENVIRONMENTA L PROTECTIO N AGENC Y [ER-FRL-5494-1 ] Environmenta l Impac

t Statements an d Regulations ; Availabilit

y o f EP A Comment

s Availabilit y of

EPA comment s prepare dJul y 6 , 199 8 Throug hJul y 10 , 199 8 pursuan t

t o th e Environmenta l Revie w Proces s (ERP) , unde r Sectio n 30 9 o f th e Clean Ai r

Ac t an dSectio n 102(2)(c ) of

th e Nationa l Environmenta l Polic y Ac t

a s amended

. Request s for copie s o f EP A comment s ca n b e directe d t o th e Offic e of

Federa l Activitie s A T (202 ) 564-5076

. A n explanatio n o f th e rating s assigne dt o draf

t environmenta l impac t statement s (EISs ) wa s publishe d i n F Rdate dApri l 10 , 199 8 (6 3 F R 17856)

. Draf tEIS s ER P No

. D-FRC-J05078-M T Ratin g E02 , Missouri-Madiso n Hydroelectri c (FER C No

. 2188 ) Project , Issuin g aNe w licenc e (Relicense ) for

Nin e Dam s an d Associate dFacilities , MT

. Summary: EPA expresse d environmenta l objection s regardin g FERC' s rejectio n o f

Sectio n 1 0 (j ) recommendations ; inadequacie s i n th e analysi s o

f therma l issues ; th e potentia l for impairmen t

t o th e beneficia l uses ; an dth e rejectio n o f

som e Stat e Clea n Wate r Ac t 40 1 conditions

. EP

A believe s FER C shoul densur e licens e condition s tha t requir e hydropowe r

operation s b e don e i n th e bes t

practicabl e manne r

t o minimiz e har mt o beneficia l uses
. Licens e condition s als o nee dt o incorporat e therma l succes s criteri aan d appropriat e languag e t o reope n th e licens e if succes s criteri aar e no t adequatel y attaine db y propose d mitigation

. EPA believe s additiona l informatio n i s neede dt o full y asses s an dmitigat e al l potentia l impact s o f th e managemen t

actions

. ER P No

. D-IBR-J28020-U T Ratin g E02 , Narrow s Daman dReservoi r Project , Constructio n o f

Supplementa l Wate r Suppl y fo r

Agricultura l an d Municipa l Wate r

Use , Gooseberr y Creek , Sanpet e an dCarbo n Counties , UT

. Summary: EPA expresse d environmenta l objection s t o th e propose dproject , an dstate dtha t i t believe s additional , les s damagin g alternative s ar e availabl e whic hwoul d reduc e th e projec t

relate dimpacts

. EP

A requeste dadditiona l detai l o n mitigation , projec t

impacts , an d alternatives

. ER P No

. D-IBR-K39045-C A Ratin g EC2 , Programmati c EIS—Centra l Valle y Projec t Improvemen t

Ac t (CVPIA ) o f 199 2 Implementation , Centra l Valley , Trinity , Contr aCosta , Alameda , Sant a Clar aan dSa n Benit o Counties , CA

. Summary: EP

A expresse dstron g suppor t for th e overal l inten t

of CVPIA implementation ; alternative s whic h provid e astron g two-pronge d commitmen t

t o ecosyste mrestoratio n an dflexible , efficien t

us e o f develope d wate r supplies ; an dus e o f

CVPI A tool s t o provid e efficien t

managemen t

o f existing , develope dwate r supplies

. EPA requeste dadditiona l informatio n an d explanatio n o n th e rang e o f implementation , relationshi p betwee n PEI S an dsubsequen t

rule s an d regulations , an dt o th e relationshi p of th e PEI S t o interi mimplementatio n program s an dth e "Garamend i process " ER P No

. DR-DOI-K40222-T T Ratin g E02 , Pala u Compac t

Roa dConstruction , Revisio n t o Major

Transportatio n an d Communicatio n Lin k

o n th e Islan do f Babeldaob , Implementation , Funding , Republi c o f

Palau , Babeldao b Island , Trus t Territor y of

th e Pacifi c Islands

. Summary: EP

A expresse d environmenta l objection s becaus e th e RDEI S di dno t

provid e sufficien t documentatio n tha t

al l practicabl e mean s hav e bee n undertake n b y th e Corp s an dth e Republi c o f Pala u t o avoi dan dminimiz e advers e impact s associate dwit hplacin g dredge do r fil l materia l i n wetland s an dothe r aquati c resource s protecte dunde r CW A Sectio n 404

. Fina l EIS s ER P No

. F-AFS-L65285-AK

. Chasin a Timbe r Sale , Harvestin g Timbe r an d Roa dConstruction , Tongas s Nationa l Forest , Crai g Range r

District , Ketchika n Administrativ e Area , AK

. Summary: Revie w o f

th e Fina l EI S wa s no t deeme dnecessary
. N o forma l commen t lette r wa s sen t t o th e preparin g agency
. ER P No

. F-AFS-L65300-AK , Cana l Hoy aTimbe r

Sale , Implementation , Stikin e Area , Tongas s Nationa l Forest , Valu e Compariso n Uni t

(VCU) , AK

. Summary: Revie w of

th e Fina l EI S wa s no t deeme dnecessary
. N o forma l commen t lette r wa s sen t t o th e preparin g agency
. Dated : July 21 , 1998

. Willia mD

. Dickerson , Director, NEPA Compliance Division, Office of Federal Activities. [F RDoc

. 98-1988 4 Filed7-23-98 ; 8:4 5 am ] BILUN G COD E 6560-50- U ENVIRONMENTA L PROTECTIO N AGENC Y [ER-FRL-5493-9] Environmenta l Impac

t Statements ; Notice o f Availability Responsible Agency: Offic e of Federa l Activities , Genera l Informatio n (202 ) 564-716 7 OR(202 ) 564-7153

. Weekl y receip t

o f Environmenta l Impac t Statement s File dJul y 13 , 199 8 Throug hJul y 17 , 199 8 Pursuan t t o 4 0 CF R1506. 9 EI S No

. 980269 , Draf

t EIS , AFS , ID

. Eagl e Bir dProjec t

Area , Timbe r Harvestin g an dRoa dConstruction , Idah o Panhandl e Nationa l Forests , St

. Jo e Range r

District , Shoshon e County , ID , Due : Septembe r

07 , 1998 , Contact : Came o Floo d(208 ) 245-4517

. EI S No

. 980270 , Fina l EIS , FHW , NC , U S 7 0 Improvement s Project , 1-4 0 t o th e Intersectio n of

U S 7 0 an dU S 7 0 Business , Fundin g an dCOE Sectio n 40 4 Permit , Wak e an dJohnsto n Counties , NC , Due : Augus t 24 , 1998 , Contact : Nichola s L

. Graf , P.E

. (919 ) 733-784 2 ext

. 260

. EI S No

. 980271 , Draf

t EIS , FHW , IN , U S 23 1 Transportatio n Project , Ne w Constructio n fro mCR-20 0 N t o CR

1150 ' 1

. Funding

. Right-of-Way Permi t an dCO E Sectio n 40 4 Permit , Spence r an dDuboi s Counties , IN , Due : Octobe r 15 , 1998 , Contact : Dougla s N

. Hea d(317 ) 226-7487

. EI S No

. 980272 , Draf

t EIS

. NOA , MS , Gran dBay Nationa l Estuarin e Researc hReserv e (NERR) , Designation , T o Conduc t Research , Educationa l Projec t

an dConstruction , Eas t o f th e City o f

Biloxi , Jackso n County , MS , Due : Septembe r 07 , 1998 , Contact : Stephani e Thornto n (301 ) 713-312 5 ext

. 11 0 EI S No

. 980273 , Draf

t Supplement , FTA , PR , Tre n Urban o Transi t Project , Update dInformatio n fo r th e Minilla s Extension , Constructio n an d Operation , Sa n Jua n Metropolita n Area , Funding , NPDE S Permit

. U S Coas t Guar dBridg e Permi t

an dCOE Sectio n 1 0 an d40 4 Permits

. PR

. Due : Septembe r

07 , 1998 , Contact : Ale x McNei l (404 ) 562-3511

. EI S No

. 980274 , Fina l EIS , FRC , NB , Kingsle y Da

mProjec t (FERC

. No

. 1417 ) an dNort hPlatte/Keyston e Diversio n Da

m(FERC

. No

. 1835 ) Hydroelectri c Project , Applicatio n for Licenses , Near

th e confluenc e of

th e North/Sout h Platt e Rivers , Keith , Lincoln , Garden , Dawso n an dGaspe r Counties , NB , Augus t

24 , 1998 , Contact : Franki e Gree n (202 ) 501

- 7704

. 

# D