24058 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

ENVIRONMENTAL PROTECTION

AGENCY

40 CFR Part 52

[FRL–6006–1]

RIN 2060–AH88

Findings of Significant Contribution

and Rulemaking on Section 126

Petitions for Purposes of Reducing

Interstate Ozone Transport

AGENCY: Environmental Protection

Agency (EPA).

ACTION: Advance notice of proposed

rulemaking.

SUMMARY: In accordance with sections

126 and 110(a)(2)(D) of the Clean Air

Act (CAA), EPA plans to take

rulemaking action on petitions filed by

eight Northeastern States seeking to

mitigate what they describe as

significant transport of one of the main

precursors of ozone smog, nitrogen

oxides (NOX), across State boundaries.

Each petition specifically requests that

EPA make a finding that NOX emissions

from certain major stationary sources

significantly contribute to ozone

nonattainment problems in the

petitioning State. If EPA makes such a

finding, EPA would be authorized to

establish Federal emissions limits for

the sources. The petitions recommend

control levels for EPA to consider. The

eight Northeastern States that filed

petitions are Connecticut, Maine,

Massachusetts, New Hampshire, New

York, Pennsylvania, Rhode Island, and

Vermont.

This notice announces the Agency’s

schedule for rulemaking on the section

126 petitions, provides EPA’s

preliminary identification of sources

named in the petitions that significantly

contribute to nonattainment problems in

the petitioning States, provides EPA’s

preliminary assessment of the types of

recommended emission limitations and

compliance schedules set forth in the

petitions, and discusses legal and policy

issues raised under section 126.

The transport of ozone is important

because ozone has long been

recognized, in both clinical and

epidemiological research, to affect

public health. There is a wide range of

ozone-induced health effects, including

decreased lung function (primarily in

children active outdoors), increased

respiratory symptoms (particularly in

highly sensitive individuals), increased

hospital admissions and emergency

room visits for respiratory causes

(among children and adults with preexisting respiratory disease such as

asthma), increased inflammation of the

lung, and possible long-term damage to

the lungs.

DATES: The EPA is establishing an

informal 30-day comment period for

today’s advance notice of proposed

rulemaking (ANPR), ending on June 1,

1998. Please direct correspondence to

the address specified below. See

SUPPLEMENTARY INFORMATION for further

information on the ANPR comment

period.

A public hearing for the future

proposed rulemaking on the section 126

petitions will be held on October 28 and

29, 1998.

ADDRESSES: Documents relevant to this

action are available for inspection at the

Air and Radiation Docket and

Information Center (6101), Attention:

Docket A–97–43, U.S. Environmental

Protection Agency, 401 M Street SW,

room M-1500, Washington, DC 20460,

telephone (202) 260–7548, between 8:00

a.m. and 4:00 p.m., Monday through

Friday, excluding legal holidays. A

reasonable copying fee may be charged

for copying.

Written comments should be

submitted to this address. Comments

and data may also be submitted

electronically by following the

instructions under SUPPLEMENTARY

INFORMATION of this document. No

confidential business information

should be submitted through e-mail.

The public hearing on the future

proposed rulemaking on the section 126

petitions will be held on October 28 and

29, 1998 at the EPA Auditorium at 401

M Street SW, Washington, DC 20460.

FOR FURTHER INFORMATION CONTACT:

Carla Oldham, Office of Air Quality

Planning and Standards, Air Quality

Strategies and Standards Division, MD–

15, Research Triangle Park, NC, 27711,

telephone (919) 541–3347.

SUPPLEMENTARY INFORMATION:

Comment Period

This ANPR gives EPA’s preliminary

assessment of the petitions and raises a

number of legal and policy issues

related to the section 126 provisions. If

comments are submitted within 30 days

of publication of this notice, EPA will

have adequate time to take the

comments into account in the

deliberative process for the rulemaking

proposal. As discussed in Section V of

this notice, under a proposed consent

decree, EPA must publish the section

126 rulemaking proposal in the Federal

Register by September 30 of this year.

A formal comment period and public

hearing will be provided for the

proposal. The EPA will respond to

comments on this ANPR, if any

comment is appropriate, when it

responds to comments on the proposal.

Availability of Related Information

The official record for this

rulemaking, as well as the public

version, has been established under

docket number A–97–43 (including

comments and data submitted

electronically as described below). The

eight petitions are contained in this

docket. A public version of this record,

including printed, paper versions of

electronic comments, which does not

include any information claimed as

confidential business information, is

available for inspection from 8 a.m. to

4 p.m., Monday through Friday,

excluding legal holidays. The official

rulemaking record is located at the

address in ADDRESSES at the beginning

of this document. Electronic comments

can be sent directly to EPA at: A-andR-Docket@epamail.epa.gov. Electronic

comments must be submitted as an

ASCII file avoiding the use of special

characters and any form of encryption.

Comments and data will also be

accepted on disks in WordPerfect in 5.1

file format or ASCII file format. All

comments and data in electronic form

must be identified by the docket number

A–97–43. Electronic comments on this

ANPR rule may be filed online at many

Federal Depository Libraries.

The EPA is conducting a separate

rulemaking action that contain actions

and information related to this ANPR,

‘‘Finding of Significant Contribution

and Rulemaking for Certain States in the

Ozone Transport Assessment Group

Region for Purposes of Reducing

Regional Transport of Ozone,’’ (see 62

FR 60318; November 7, 1997 and a

supplemental proposal being published

in late April or early May 1998.)

Documents related to these proposals

are available for inspection in Docket

No. A–96–56 at the address and times

given above. This rulemaking action is

hereafter referred to as the proposed

NOX State implementation plan (SIP)

call (proposed NOX SIP call). The

proposed NOX SIP call and associated

documents are located at http://

www.epa.gov/ttn/oarpg.otagsip.html.

Additional information relevant to

this ANPR concerning the Ozone

Transport Assessment Group (OTAG) is

available on the Agency’s Office of Air

Quality Planning and Standards’

(OAQPS) Technology Transfer Network

(TTN) via the web at http://

www.epa.gov/ttn/. If assistance is

needed in accessing the system, call the

help desk at (919) 541–5384 in Research

Triangle Park, NC. Documents related to

OTAG can be downloaded directly from

OTAG’s webpage at http://
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24059

www.epa.gov/ttn/otag. The OTAG’s

technical data are located at http://

www.iceis.mcnc.org/OTAGDC.

Outline

I. Background

A. Ozone Transport, Ozone Transport

Commission NOX Memorandum of

Understanding (OTC NOX MOU), OTAG,

the Proposed NOX SIP Call, and the

Revised Ozone National Ambient Air

Quality Standard (NAAQS)

B. Section 126

C. Summary of Section 126 Petitions

D. Relationship to NOX SIP Call

E. Proposed Rulemaking Schedule

II. Preliminary Analysis of Significant

Contribution

A. Background

B. Regional Ozone and Interstate Transport

C. Collective Contribution to

Nonattainment

D. Weight of Evidence Approach and

Findings of Significant Contribution

E. Technical Approach to Preliminary

Analysis of Petitions

F. Results of Preliminary Assessment of

Section 126 Petitions

III. Preliminary Assessment of Emissions

Limitations and Compliance Schedules

A. Remedies Recommended in Petitions

B. EPA’s Analytic Approach

C. Intent to Implement Controls Through

Cap-and-Trade Program

IV. Legal and Policy Issues

A. Issues Involving Significant

Contribution

B. Issues Involving Trading

C. Cost-Effectiveness Issues

D. Legal Issues

V. Schedule for Rulemaking Action of

Section 126 Petitions

VI. Impact on Small Entities

I. Background

A. Ozone Transport, Ozone Transport

Commission NOX Memorandum of

Understanding (OTC NOX MOU),

OTAG, the Proposed NOX SIP Call, and

the Revised Ozone National Ambient

Air Quality Standard (NAAQS)

Today’s action occurs against a

background of a major national effort,

spanning at least the last 10 years, to

analyze and take steps to mitigate the

problem of the transport of ozone and

its precursors across State boundaries.

This effort has grown more intensive in

the past several years with the approval

of the OTC NOX MOU by 11 of the

Northeastern States and the District of

Columbia included in the OTC, the

completion of the OTAG process, and

the publication of EPA’s proposed NOX

SIP call. In addition, in July 1997, EPA

issued a revised NAAQS for ozone,

which is determined over an 8-hour

period (the 8-hr standard). This new 8-

hr standard must now be taken into

account, along with the pre-existing 1-

hr standard, in resolving transport

issues. These issues and events are

detailed in the proposed NOX SIP call

(62 FR 60318) and familiarity with that

notice is assumed for purposes of

today’s notice.

B. Section 126

Today’s action focuses on section 126

of the CAA. Subsection (a) of section

126 requires, among other things, that

SIPs require major proposed new (or

modified) sources to notify nearby

States for which the air pollution levels

may be affected by the fact that such

sources have been permitted to

commence construction. Subsection (b)

provides:

Any State or political subdivision may

petition the Administrator for a finding that

any major source or group of stationary

sources emits or would emit any air pollutant

in violation of the prohibition of section

110(a)(2)(D)(ii) * * * or this section.

Subsection (c) of section 126 states

that—

[I]t shall be a violation of this section and

the applicable implementation plan in such

State [in which the source is located or

intends to locate]—

(1) for any major proposed new (or

modified) source with respect to which a

finding has been made under subsection (b)

of this section to be constructed or to operate

in violation of the prohibition of section

110(a)(2)(D)(ii) * * * or this section, or

(2) for any major existing source to operate

more than three months after such finding

has been made with respect to it.

However, subsection (c) further

provides that EPA may permit the

continued operation of such major

existing sources beyond the 3-month

period, if such sources comply with

EPA-promulgated emissions limits

within 3 years of the date of the finding.

Section 110(a)(2)(D) provides the

requirement that a SIP contain adequate

provisions—

(i) prohibiting, consistent with the

provisions of this title, any source or other

type of emissions activity within the State

from emitting any air pollutant in amounts

which will—

(I) contribute significantly to

nonattainment in, or interfere with

maintenance by, any other State with respect

to [any] national * * * ambient air quality

standard, or

(II) interfere with measures required to be

included in the applicable implementation

plan for any other State under part C to

prevent significant deterioration of air quality

or to protect visibility.

(ii) insuring compliance with the

applicable requirements of sections 126 and

115 (relating to interstate and international

pollution abatement) * * *

For purposes of today’s ANPR, it is

EPA’s preliminary view that, with

respect to existing stationary sources,

sections 126(b)–(c) and 110(a)(2)(D),

read together, authorize a downwind

State to petition EPA for a finding that

emissions from major stationary sources

upwind of the State contribute

significantly to nonattainment, or

interfere with maintenance, of a NAAQS

in the State. If EPA grants the requested

finding, EPA must directly regulate the

sources. Sources would have to comply

with the emissions limits within 3 years

from the finding. The EPA

acknowledges that others have urged

different readings of sections 126(b)–(c)

and 110(a)(2)(D), and EPA solicits

comments thereon, as described in

Section IV below.

In a letter dated August 8, 1997, to

Michael J. Walls, Chief, Environmental

Protection Bureau, Office of Attorney

General, State of New Hampshire, from

Mary D. Nichols, Assistant

Administrator for Air and Radiation,

EPA provided preliminary and general

guidance concerning section 126 and

the process of submitting petitions

(Nichols letter). This letter has been

placed in the docket for today’s action.

In Section IV of this notice, below,

EPA discusses legal and policy issues

raised under section 126 and requests

comments on the various issues.

C. Summary of Section 126 Petitions

On August 14–15, 1997, EPA received

eight section 126 petitions submitted

individually by eight Northeastern

States. The petitioning States are

Connecticut, Maine, Massachusetts,

New Hampshire, New York,

Pennsylvania, Rhode Island, and

Vermont. Each petition requests EPA to

make a finding that certain major

stationary sources in upwind States

contribute significantly to

nonattainment, or interfere with

maintenance, in the petitioning State.

All of the petitions seek a finding and

relief under the 1-hr standard;

Massachusetts, Pennsylvania, and

Vermont also seek a finding and relief

with respect to the 8-hr standard.

The petitions vary as to the type and

geographic location of the sources

identified as significant contributors.

Some petitions identify specific sources,

others list source categories. The

sources and source categories include

electric generating plants, fossil fuelfired boilers and other indirect heat

exchangers, and certain other related

stationary sources that emit NOX. All

the petitions target sources in the

Midwest; some also target sources in the

South and Northeast.

The petitions also vary as to the level

of controls they recommend be applied

to the sources to mitigate the transport

problem. Several recommend EPA

establish a 0.15 lb/mmBtu NOX
24060 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

1National Research Council, Committee on

Tropospheric Ozone Formation and Measurement,

‘‘Rethinking the Ozone Problem in Urban and

Regional Air Pollution,’’ pp. 93–107, National

Academy Press, Washington, DC, 1991.

2Northeast States for Coordinated Air Use

Management, ‘‘The Long-Range Transport of Ozone

and Its Precursors in the Eastern United States,’’

emission limitation implemented

through a cap-and-trade program. The

petitions are described in greater detail

in Sections II and III of this notice.

All of the petitions rely, in part, on

OTAG analyses for technical support. In

addition, the States submitted a variety

of other technical analyses which

include computerized urban airshed

modeling, wind trajectory analyses,

results of a transport study by the

Northeast States for Coordinated Air

Use Management, and culpability

analyses.

D. Relationship to NOX SIP Call

The sources, or groups of sources,

identified in the petitions may also be

subject to State-adopted emission

limitations and control schedules in

response to a separate rulemaking action

on regional ozone transport—the NOX

SIP call.

In the proposed NOX SIP call, EPA

made a proposed determination that

NOX emissions from 22 eastern States

and the District of Columbia

significantly contribute to

nonattainment problems in downwind

States with respect to both the longstanding 1-hr NAAQS and the new 8-hr

NAAQS. The EPA proposed that these

jurisdictions be required to revise their

SIPs to reduce Statewide NOX emissions

to a specified level. The proposal is

designed to assure that SIPs meet the

requirements of section 110(a)(2)(D),

which mandates that SIPs contain

adequate provisions prohibiting

emissions that significantly contribute

to downwind nonattainment.

The proposed NOX SIP call is the

result of technical analyses and

recommendations by the OTAG, a group

comprised of EPA and the 37 easternmost States in the Nation, as well as

industry and environmental groups.

Because the NOX SIP call process

overlaps considerably with the section

126 petition process, EPA believes it is

important to coordinate the two actions

as much as possible.

E. Proposed Rulemaking Schedule

Section 126(b) requires EPA to make

the requested finding, or deny the

petition, within 60 days of receipt. It

also requires EPA to provide a public

hearing for the petition. In addition,

EPA’s action under section 126 is

subject to the procedural requirements

of section 307(d) of the Act. One of

these requirements is notice-andcomment rulemaking. Section 307(d)

provides for a time extension, under

certain circumstances, for rulemakings

subject to that provision. Specifically, it

allows statutory deadlines that require

promulgation in less than 6 months

from proposal to be extended to not

more than 6 months from proposal to

afford the public and the Agency

adequate opportunity to carry out the

purposes of section 307(d). In three

notices dated October 22, 1997 (62 FR

55769), November 20, 1997 (62 FR

6194), and January 2, 1998 (63 FR 26),

EPA ultimately extended the deadline

for action to December 18, 1997.

On February 25, 1998, the eight

petitioning States filed a complaint in

the U.S. District Court for the Southern

District of New York to compel EPA to

take action on the States’ section 126

petitions. The EPA and the eight States

filed a proposed consent decree that

would establish a schedule for acting on

the petitions. Pursuant to CAA section

113(g), the EPA has solicited comments

on the proposed consent decree, by

notice dated March 5, 1998 (63 FR

10874). The comment period closed

April 6, 1998.

The schedule recommended in the

proposed consent decree would require

EPA to take final action on at least the

technical merits of the petitions by

April 30, 1999. The recommendation

would further provide for an alternative

schedule under which EPA could delay

final action on the petitions until May

1, 2000. The section 126 rulemaking

schedule is described in more detail in

Section V of this notice.

II. Preliminary Analysis of Significant

Contribution

A. Background

This section describes EPA’s

preliminary analysis of whether the

sources identified in the section 126

petitions significantly contribute to

nonattainment problems in the eight

petitioning States. The EPA is relying on

information included in the proposed

NOX SIP call on significant contribution

for this analysis. The proposed NOX SIP

call significance determination was

based upon a ‘‘weight of evidence’’

approach in which a range of technical

information was evaluated against a set

of factors, as described below. This

section presents: (1) General

information on the importance of

transport to ozone formation, (2) the

collective nature of the contribution of

man-made emissions to ozone

formation, (3) factors considered in the

weight of evidence approach and

findings of significant contribution in

the proposed NOX SIP call, and (4)

analysis of these findings relative to

each of the petitions.

B. Regional Ozone and Interstate

Transport

The importance of interstate transport

to the regional ozone problem and

contributions from upwind States to

downwind States is supported by

numerous studies of air quality

measurements and modeling analyses.

In general, ozone episodes occur on

many spatial and temporal scales

ranging from localized subregional

events lasting a day or two, up to

regionwide episodes lasting as long as

10–14 days. The frequency of localized

versus regional episodes depends on the

characteristics of the large-scale

meteorological patterns which control

the weather in a particular summer

season. In some cases, local controls

alone are not sufficient to reduce ozone

during regionwide episodes since a

substantial amount of ozone may be

transported into the area from upwind

sources.

The National Research Council report,

‘‘Rethinking the Ozone Problem in

Urban and Regional Air Pollution,’’ 1

cites numerous studies of widespread

ozone episodes during summertime

meteorological conditions in the East.

These episodes typically occur when a

large, slow-moving, high pressure

system envelopes all, or a large portion

of, the Eastern United States. The

relatively clear skies normally

associated with such weather systems

favor high temperatures and strong

sunlight, which enhances the formation

of high ozone concentrations. In

addition, the wind flow patterns can

lead to a build up of ozone

concentrations and the potential for

long-range ozone transport. Specifically,

winds are generally light in the center

of high pressure systems so that areas

under the center may have nearstagnation conditions resulting in the

formation of high ozone levels. As the

high pressure system moves eastward,

winds become stronger on the

‘‘backside’’ which increases the

potential for these high ozone levels to

be transported to more distant

downwind locations. Over several days,

the emissions from numerous small,

medium, and large cities, major

stationary sources in rural areas, as well

as natural sources, combine to form a

‘‘background’’ of moderate hourly ozone

levels ranging from 80 to 100 ppb 2 of
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24061

March 1997, Boston, MA. (Document is available in

Docket A–96–56 for the NOX SIP call.)

3 Ibid.

4For a technical description of this modeling, see

proposed NOX SIP call, 62 FR 60,335–60,337.

5These areas are considered as having a

‘‘monitored’’ plus ‘‘modeled’’ ozone problem and

are referred to as ‘‘nonattainment’’ for the purposes

of this discussion.

which only 30 to 40 ppb may be due to

natural sources. Hourly ozone

concentration levels in the range of 80

to 100 ppb and higher have also been

measured by aircraft aloft, across

portions of the Northeast 3. Because this

level of background ozone is so close to

the ozone NAAQS, even a small amount

of locally-generated ozone will result in

an exceedance.

C. Collective Contribution to

Nonattainment

Ozone is generally the result of

cumulative emissions of NOX and

volatile organic compounds (VOC) from

hundreds of stationary sources and

millions of vehicles, each of which is

likely to be responsible for much less

than 1 percent of the overall inventory

of precursor emissions. A source (or

group of sources) should not be

exempted from treatment as a

significant contributor merely because it

may be a small part, in terms of total

emissions, of the overall problem when

all or most other contributors,

individually, are also relatively small

parts of the overall problem. This

situation, in which a number of

individual (and sometimes small)

sources collectively cause a significant

impact on air quality, is a major aspect

of the contribution issue. As noted

above, the moderate-to-high ozone

levels which cover broad regions are the

result of emissions from millions of

individual sources interacting over

multiple days. The contribution to

downwind nonattainment results from

the cumulative contribution from all

sources involved in this process.

In light of these considerations, in the

proposed NOX SIP call, EPA believed it

not appropriate to define a bright line

test for significant contribution. Instead,

EPA relied on a weight of evidence

approach, based on a range of

information, for determining whether a

State makes a significant contribution to

downwind nonattainment.

D. Weight of Evidence Approach and

Findings of Significant Contribution

The factors considered by the EPA in

the proposed NOX SIP call for

determining whether a contribution is

significant include:

• the transport distance between the

upwind source area and the downwind

problem area;

• the amount of the contribution (ppb

above the level of the ozone standard)

made to the downwind nonattainment

area;

• the geographic extent of the

contribution downwind; and

• the level of emissions in the area

upwind of a nonattainment area.

Details of the methodology and

approaches followed by EPA in its

analysis of these factors are documented

in the proposed NOX SIP call.4

In brief, the results of the OTAG air

quality, trajectory, and wind vector

analyses indicate that the 1- to 2-day

transport distance scale for the northern

portion of the OTAG domain is

generally in the range of 150 to 500

miles. This information was used to

identify a set of States which could

potentially contribute to downwind

nonattainment. The amount of

contribution and geographic extent of

contribution from upwind areas to

downwind nonattainment were

quantified by EPA based on analysis of

the OTAG subregional modeling. In

these model runs, all manmade

emissions were removed in each of 12

subregions (see Figure 1), individually.

The resulting ‘‘ppb’’ contributions were

tabulated by State for areas within the

State which (a) currently violate the

NAAQS, based on 1993–1995 ambient

monitoring data and (b) which are also

expected to continue to violate the

NAAQS, based on future-year 2007

modeling of CAA controls.5

Contributions to 1-hr and 8-hr

nonattainment were considered

separately. The modeling results

indicate that emissions from States

wholly or partially contained in

Subregions 1 through 9 produce large

and frequent contributions to

downwind nonattainment for both

NAAQS. The EPA then examined NOX

emissions data along with the OTAG

trajectory and modeling results to

identify 23 jurisdictions which it

proposed to determine make a

significant contribution to

nonattainment of both the 1-hr and 8-hr

NAAQS in downwind States. These

jurisdictions are: Alabama, Connecticut,

Delaware, District of Columbia, Georgia,

Illinois, Indiana, Kentucky, Maryland,

Massachusetts, Michigan, Missouri,

New Jersey, New York, North Carolina,

Ohio, Pennsylvania, Rhode Island,

South Carolina, Tennessee, Virginia,

West Virginia, and Wisconsin.

BILLING CODE 6560–50–P
24062 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

Figure 1. Location of Subregions

BILLING CODE 6560–50–C

E. Technical Approach to Preliminary

Analysis of Petitions

The EPA is in the process of gathering

and reviewing technical information to

determine whether EPA should find that

certain large upwind stationary sources

and/or source categories of NOX named

in each petition contribute significantly

to nonattainment in the petitioning

States. The EPA expects to propose its

findings in a subsequent notice of

proposed rulemaking. The following

preliminary analysis should not be

interpreted as a proposed finding of

significant contribution for these

petitions.

The EPA has examined the petitions

based on the significant contribution

analysis in the proposed NOX SIP call.

First, EPA determined if those source

areas identified by the petitioners are

located in States which EPA, in the

proposed NOX SIP call, proposed to

determine make a significant

contribution to downwind

nonattainment. Second, EPA examined

subregional modeling results to

ascertain the predicted contributions to

nonattainment relative to the source

areas named in each petition.

The source areas named in petitions

submitted by Connecticut,

Massachusetts, New Hampshire, New

York, Rhode Island and Vermont are

generally limited to States which were

found in the proposed NOX SIP call to

make a significant contribution to

downwind nonattainment. The

geographic area covered by each

petition is shown in Figure 2.

Specifically, the New York and

Connecticut petitions cover sources in

areas extending west and south of each

of these States up to the western

boundaries of Subregions 2 and 6 and

the southern boundaries of Subregions 6

and 7. For the New York petition, this

includes all or portions of the following

States: Delaware, Indiana, Kentucky,

Maryland, Michigan, New Jersey, North

Carolina, Ohio, Pennsylvania,

Tennessee, Virginia, and West Virginia.

In addition to these States, the

Connecticut petition also covers sources

in portions of New York. The

Massachusetts and Rhode Island

petitions name specific sources in

individual counties within the

Subregion 6 States of Indiana, Kentucky,

Ohio, and West Virginia. The New

Hampshire petition includes sources in

upwind portions of the Ozone Transport

Region and in Subregions 1 through 7,

which includes all or portions of

Connecticut, Delaware, District of

Columbia, Illinois, Indiana, Kentucky,

Maryland, Massachusetts, Michigan,

Missouri, New Jersey, New York, Ohio,

Pennsylvania, Rhode Island, Virginia,

West Virginia, and Wisconsin. Also, the

New Hampshire petition includes a

portion of eastern Iowa (which is part of

Subregion 1) which EPA, in the

proposed NOX SIP call, proposed to

determine did not make a significant

contribution to downwind

nonattainment problems. The Vermont

petition named sources in upwind

portions of the Ozone Transport Region

and in all or portions of Illinois,

Indiana, Kentucky, Michigan, North

Carolina, Ohio, Tennessee, Virginia, and

West Virginia. Further, the petition

notes that it intends to cover additional

unidentified sources within an area

extending 1,000 miles Southwest of

Vermont if EPA determines the sources

to be significantly contributing to

Vermont. This broader geographic area

includes South Carolina and portions of

Alabama, Georgia, Missouri, and

Wisconsin. The Vermont petition also
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24063

includes a portion of eastern Iowa

which EPA, in the proposed NOX SIP

call, proposed to determine did not

make a significant contribution to

downwind nonattainment problems.

The Pennsylvania petition named

Alabama, Georgia, Illinois, Indiana,

Kentucky, Michigan, Missouri, North

Carolina, Ohio, South Carolina,

Tennessee, Virginia, West Virginia, and

Wisconsin. However, the Pennsylvania

petition also named several States

which EPA, in the proposed NOX SIP

call, proposed to determine did not

make a significant downwind

contribution including: Arkansas, Iowa,

Louisiana, Minnesota, and Mississippi.

The petition from Maine named source

categories for sources in upwind

portions of the Ozone Transport Region

and generally within all or portions of

Subregions 2, 3, 4, 6, and 7. The Maine

petition includes all or parts of the

following jurisdictions: Connecticut,

Delaware, District of Columbia,

Maryland, Massachusetts, New Jersey,

New York, North Carolina, Ohio,

Pennsylvania, Rhode Island, Virginia,

and West Virginia. The Maine petition

also identified New Hampshire and

Vermont as containing sources which

contribute significantly to

nonattainment in Maine, but in the

proposed NOX SIP call these States were

not found to make a significant

contribution downwind.

BILLING CODE 6560–50–P
24064 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

Figure 2a. Areas Covered by the Section 126 Petitions: New York (Top) and Connecticut (Bottom)
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24065

Figure 2b. Areas Covered by the Section 126 Petitions: Pennsylvania (Top), Massachusetts and Rhode Island (Bottom)
24066 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

Figure 2c. Areas Covered by the Section 126 Petitions: Maine (Top) and New Hampshire (Bottom)
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24067

6Note that these subregions are important

because all man-made emissions in these

subregions were found to make large and frequent

contributions to downwind nonattainment.

Figure 2d. Areas Covered by the Section 126 Petitions: Vermont

BILLING CODE 6560–50–C

Although there are differences

between the petitions in terms of the

sources named as significant

contributors, the petitions have

generally targeted NOX emissions from

utility and large non-utility (>250

mmBtu/Hr) fossil fuel-fired boilers. In

this regard, analyzing the contributions

from these emissions categories (i.e.

utility and large non-utilities) is

somewhat complicated because the

subregional modeling in the proposed

NOX SIP call quantifies the

contributions from all man-made

emissions in each subregion, not just

these categories. It is likely that the

emissions from these categories produce

downwind contributions which are at

least roughly proportional to their

relative amount of emissions, compared

to the total man-made emissions in the

subregion. As shown in Table 1, NOX

emissions from these categories

combined, range from 33 percent to 60

percent of the total 2007 projected NOX

emissions within Subregions 1–9 6.

Thus, the utility and large non-utility

emissions combined represent a

relatively large portion of total NOX

emissions within these nine subregions.

The collective contribution approach

discussed above suggests that if total

emissions in an upwind area are found

to make a significant contribution to

downwind nonattainment, then the

individual components of the areas’

emissions are considered to be part of

the significant contribution. Thus, the

subregional modeling results are

relevant to the source categories

identified in the petitions because these

categories are a large component of the

total man-made NOX emissions and are

therefore expected to produce

contributions in proportion to their

emissions.

TABLE 1.—PERCENT OF TOTAL SUBREGION NOX emitted by Utility and

Large Non-Utility Sources (OTAG

2007 Base Case)

Subregion Percent

1 .................................................... 39

2 .................................................... 37

3 .................................................... 46

4 .................................................... 33

5 .................................................... 60

6 .................................................... 53

7 .................................................... 39

8 .................................................... 36

9 .................................................... 39

10 .................................................. 38

11 .................................................. 29

12 .................................................. 32

Table 2 provides the contributions to

1-hr and 8-hr nonattainment in each of

the petitioning States from those

upwind subregions which (a)

correspond to upwind areas named in

the petitions and (b) contain States

which were found to make a significant

contribution to downwind

nonattainment in the proposed NOX SIP

call. These contributions are based on

zero-out modeling of all man-made

emissions in the subregion. Data are

provided for the areas which have both

‘‘monitored’’ violations and ‘‘modeled’’

concentrations exceeding the NAAQS.

This information was extracted from

Tables II–10 and II–12 in the proposed

NOX SIP call. Note that 2 ppb is the

lower range of the tabulated

contributions, following the convention

adopted by OTAG.

These results are discussed for each

petition:

New York—This petition named

sources in Subregions 2, 6, and 7. The

subregional modeling results indicate a

number of contributions in the range of

5–10 ppb or more from each of these

subregions to both 1-hr and 8-hr

nonattainment in New York.

Contributions of 15–20 ppb are

predicted from Subregion 7 to 1-hr

nonattainment and from Subregions 2

and 7 to 8-hr nonattainment.

Connecticut—Subregions 2, 6, and 7

were named as source areas by

Connecticut. For the both 1-hr and 8-hr

nonattainment, frequent contributions

are predicted from each of these

subregions. The magnitude of the

contributions ranges up to 15–20 ppb

for 1-hr nonattainment and up to 10–15

ppb for 8-hr nonattainment.
24068 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

TABLE 2.—CONTRIBUTIONS TO 1-HOUR AND 8-HOUR NONATTAINMENT IN EACH PETITIONING STATE FROM SELECTED

SUBREGIONS (SUB)

Impacts (ppb) Sub 2 Sub 6 Sub 7

NEW YORK

Contributions to 1-Hour Nonattainment

2–5 ............................................................................................................................................................ 47 41 30

5–10 .......................................................................................................................................................... 6 16 52

10–15 ........................................................................................................................................................ 0 4 15

15–20 ........................................................................................................................................................ 0 0 4

20–25 ........................................................................................................................................................ 0 0 0

>25 ........................................................................................................................................................... 0 0 0

Contributions to 8-Hour Nonattainment

2—5 .......................................................................................................................................................... 25 15 39

5—10 ........................................................................................................................................................ 4 3 16

10–15 ........................................................................................................................................................ 4 0 4

15–20 ........................................................................................................................................................ 0 0 0

20–25 ........................................................................................................................................................ 0 0 0

>25 ........................................................................................................................................................... 0 0 0

CONNECTICUT

Contributions to 1-Hour Nonattainment

2–5 ............................................................................................................................................................ 65 4 50

5–10 .......................................................................................................................................................... 3 9 31

10–15 ........................................................................................................................................................ 0 0 8

15–20 ........................................................................................................................................................ 0 0 2

20–25 ........................................................................................................................................................ 0 0 0

>25 ........................................................................................................................................................... 0 0 0

Contributions to 8-Hour Nonattainment

2–5 ............................................................................................................................................................ 19 44 36

5–10 .......................................................................................................................................................... 0 2 16

10–15 ........................................................................................................................................................ 0 0 1

15–20 ........................................................................................................................................................ 0 0 0

20–25 ........................................................................................................................................................ 0 0 0

>25 ........................................................................................................................................................... 0 0 0

Impacts (ppb) Sub 1 Sub 2 Sub 5 Sub 6 Sub 7 Sub 8 Sub 9

PENNSYLVANIA

Contributions to 1-Hour Nonattainment

2–5 ............................................................ 0 1 2 4 3 4 0

5–10 .......................................................... 0 0 0 4 2 0 0

10–15 ........................................................ 0 0 0 2 13 0 0

15–20 ........................................................ 0 0 0 0 11 0 0

20–25 ........................................................ 0 0 0 0 2 0 0

>25 ............................................................ 0 0 0 0 7 0 0

Contributions to 8-Hour Nonattainment

2–5 ............................................................ 14 42 71 72 57 13 0

5–10 .......................................................... 0 26 10 53 66 0 0

10–15 ........................................................ 0 6 0 40 30 0 0

15–20 ........................................................ 0 2 0 10 4 0 0

20–25 ........................................................ 0 5 0 7 0 0 0

>25 ............................................................ 0 1 0 0 0 0 0

Impacts (ppb) Sub 6

1-hour

Sub 6

8-hour

MASSACHUSETTS

Contributions to 1-hour and 8-hour Nonattainment

2–5 ................................................................................................................................................................................... 0 22

5–10 ................................................................................................................................................................................. 0 0

10–15 ............................................................................................................................................................................... 0 0

15–20 ............................................................................................................................................................................... 0 0

20–25 ............................................................................................................................................................................... 0 0
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24069

Impacts (ppb) Sub 6

1-hour

Sub 6

8-hour

>25 ................................................................................................................................................................................... 0 0

RHODE ISLAND

Contributions to 1-hour and 8-hour Nonattainment

2–5 ................................................................................................................................................................................... 0 1

5–10 ................................................................................................................................................................................. 2 0

10–15 ............................................................................................................................................................................... 0 0

15–20 ............................................................................................................................................................................... 0 0

20–25 ............................................................................................................................................................................... 0 0

>25 ................................................................................................................................................................................... 0 0

Impacts (ppb) Sub 2 Sub 3 Sub 4 Sub 6 Sub 7

MAINE

Contributions to 1-Hour Nonattainment

2–5 ............................................................................................................ 0 7 0 0 0

5–10 .......................................................................................................... 0 0 2 0 0

10–15 ........................................................................................................ 0 0 15 0 0

15–20 ........................................................................................................ 0 0 0 0 0

20–25 ........................................................................................................ 0 0 0 0 0

>25 ............................................................................................................ 0 0 0 0 0

Contributions to 8-Hour Nonattainment

2–5 ............................................................................................................ 8 28 0 0 3

5–10 .......................................................................................................... 0 0 20 0 0

10–15 ........................................................................................................ 0 0 6 0 0

15–20 ........................................................................................................ 0 0 4 0 0

20–25 ........................................................................................................ 0 0 0 0 0

>25 ............................................................................................................ 0 0 0 0 0

Impacts (ppb) Sub 1 Sub 2 Sub 3 Sub 4 Sub 5 Sub 6 Sub 7

NEW HAMPSHIRE

Contributions to 1-Hour Nonattainment

2–5 ............................................................ 0 0 4 8 0 0 0

5–10 .......................................................... 0 0 0 1 0 0 0

10–15 ........................................................ 0 0 0 11 0 0 0

15–20 ........................................................ 0 0 0 3 0 0 0

20–25 ........................................................ 0 0 0 1 0 0 0

25 ........................................................... 0 0 0 1 0 0 0

Contributions to 8-Hour Nonattainment

2–5 ............................................................ 0 8 12 2 0 0 0

5–10 .......................................................... 0 0 1 6 0 0 0

10–15 ........................................................ 0 0 0 0 0 0 0

15–20 ........................................................ 0 0 0 0 0 0 0

20–25 ........................................................ 0 0 0 0 0 0 0

>25 ............................................................ 0 0 0 0 0 0 0

Impacts

(ppb) Sub 1 Sub 2 Sub 3 Sub 4 Sub 5 Sub 6 Sub 7 Sub 8 Sub 9

VERMONT

Contributions to 1-Hour Nonattainment

2–5 ............. 0 0 0 0 0 0 0 0 0

5–10 ........... 0 0 0 0 0 0 0 0 0

10–15 ......... 0 0 0 6 0 0 0 0 0

15–20 ......... 0 0 0 0 0 0 0 0 0

20–25 ......... 0 0 0 0 0 0 0 0 0

<25 ............. 0 0 0 0 0 0 0 0 0

Contributions to 8-Hour Nonattainment

2–5 ............. 0 0 0 0 0 0 0 0 0

5–10 ........... 0 0 0 0 0 0 0 0 0

10–15 ......... 0 0 0 0 0 0 0 0 0

15–20 ......... 0 0 0 0 0 0 0 0 0

20–25 ......... 0 0 0 0 0 0 0 0 0

<25 ............. 0 0 0 0 0 0 0 0 0
24070 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

7Tennessee is included because it is part of

Subregions 5 and 6. Tennessee is also part of

Subregion 9 which, based on the subregional

modeling, does not contribute to 1-hr

nonattainment in any of the petitioning States.

8 Georgia is included because it is part of

Subregion 8. Georgia is also part of Subregion 9

which, based on subregional modeling, does not

contribute to 8-hr nonattainment in any of the

petitioning States.

9Tennessee is included because it is part of

Subregions 5 and 6. Tennessee is also part of

Subregion 9 which, based on the subregional

modeling, does not contribute to 1-hr

nonattainment in any of the petitioning States.

Pennsylvania—This petition named

States which generally correspond to

Subregions 1, 2, 5, 6, 7, 8, and 9. Of

these, Subregions 2, 5, 6, 7, and 8

contribute to 1-hr nonattainment in

Pennsylvania. The largest and most

frequent contributions are predicted to

come from Subregions 7 and 6,

respectively. No contributions >2 ppb

are predicted from Subregions 1 or 9.

For 8-hr nonattainment, the largest

contributions are from Subregions 2, 6,

and 7. The magnitude of the

contributions from these three

subregions is in the range of 15–20 ppb

or more. No contributions to 8-hr

nonattainment >2 ppb were predicted

from Subregion 9.

Massachusetts—This petition named

sources within a portion of Subregion 6.

However, no contributions >2 ppb were

predicted to 1-hr nonattainment from

this subregion to nonattainment in

Massachusetts. Contributions to 8-hr

nonattainment from this subregion were

in the range of 2–5 ppb.

Rhode Island—This petition also

named sources within a portion of

Subregion 6. Contributions from this

subregion to 1-hr nonattainment were

5–10 ppb. The predicted contribution to

8-hr nonattainment from this subregion

was in the range of 2–5 ppb.

Maine—Of the five subregions (i.e.

Subregions 2, 3, 4, 6, and 7) which are

associated with sources named in

Maine’s petition, contributions to 1-hr

nonattainment were predicted from

Subregions 3 and 4, with contributions

to 8-hr nonattainment from Subregions

2, 3, 4, and 7. The largest contributions

were from Subregion 4 at 10–15 ppb for

1-hr contributions and 15–20 ppb for 8-

hr contributions. No contributions were

predicted from Subregion 6 to either 1-

hr or 8-hr nonattainment.

New Hampshire—Subregions 1

through 7 are associated with sources

named in the New Hampshire petition.

Of these subregions, however, only

Subregions 3 and 4 are predicted to

contribute >2 ppb to 1-hr nonattainment

with the largest contributions, >25 ppb,

from Subregion 4. Subregions 2, 3, and

4 are predicted to contribute >2 ppb to

8-hr nonattainment with contributions

of 10–15 ppb from Subregion 4.

Vermont—There is no current or

predicted ‘‘nonattainment’’ in Vermont,

based on 1993–1995 ambient

monitoring data and/or model

predictions from the OTAG 2007 Base

Case.

F. Results of Preliminary Assessment of

Section 126 Petitions

As indicated above, the purpose of

this preliminary analysis is not to make

a proposed finding of ‘‘significance’’

relative to the sources and/or source

categories named in each petition.

Rather, the intent is to identify the

contributions to 1-hr and 8-hr

nonattainment in each State based on

information developed in the proposed

NOX SIP call as part of the significant

contribution determination. As a whole,

the eight petitions cover sources in

States within OTAG Subregions 1, 2, 3,

4, 5, 6, 7, 8, 9, 11, and 12, as well as

in Massachusetts, New Hampshire,

Rhode Island, and Vermont. Of these,

emissions in States covered by

Subregions 1, 2, 3, 4, 5, 6, 7, 8, and 9

along with Massachusetts and Rhode

Island were proposed, by EPA, to make

a significant contribution to downwind

nonattainment in the NOX SIP call.

This preliminary assessment indicates

that sources in Subregions 2, 3, 4, 5, 6,

and 7 contribute to 1-hr nonattainment

in at least one of the petitioning States.

The 16 States and the District of

Columbia that are wholly or partially

within these subregions include:

Connecticut, Delaware, Illinois, Indiana,

Kentucky, Maryland, Michigan,

Missouri, New Jersey, New York, North

Carolina, Ohio, Pennsylvania,

Tennessee 7, Virginia, and West

Virginia. Based on these results, EPA’s

preliminary assessment indicates that

the source categories identified by the

petitions that are located within these

16 States and the District of Columbia

make a significant contribution to

nonattainment of the 1-hr standard. In

addition, in the proposed NOX SIP call,

EPA proposed that Massachusetts and

Rhode Island be considered significant

contributors to nonattainment in

downwind States, including Maine and

New Hampshire. Accordingly, sources

in these two States are preliminarily

included in this assessment as

significant contributors.

Sources in Subregions 1, 2, 3, 4, 5, 6,

7, and 8 contribute to 8-hr

nonattainment in at least one of the

petitioning States. However, it should

be noted that sources in only Subregions

1, 2, 5, 6, 7, and 8 contribute to 8-hr

nonattainment in one of the three

petitioning States (Massachusetts,

Pennsylvania, and Vermont) that

requested EPA to make a finding under

the 8-hr NAAQS. The 15 States and the

District of Columbia which are wholly

or partially within the subregions

contributing to 8-hr nonattainment in

Pennsylvania (i.e. subregions 1, 2, 5, 6,

7, and 8) and Massachusetts (i.e.,

subregion 6) and which were proposed

to make a significant contribution to

downwind nonattainment in the

proposed NOX SIP call are Delaware,

Georgia 8, Illinois, Indiana, Kentucky,

Maryland, Michigan, Missouri, North

Carolina, Ohio, South Carolina,

Tennessee 9, Virginia, West Virginia,

and Wisconsin. The EPA’s preliminary

assessment indicates that the source

categories identified by the petitions

that are located within these States

make a significant contribution to

nonattainment of the 8-hr standard (or

interfere with maintenance of that

standard) in the petitioning States.

Because there are no current or

predicted nonattainment problems in

Vermont, there are no upwind source

areas that are included in the

preliminary assessment of significant

contribution due to the Vermont

petition.

As noted above, the petitioning States

submitted technical data in addition to

the zero-out modeling data just

described. The EPA is continuing to

review the States’ technical data, as well

as other data relevant to the petitions, to

develop a proposed finding for each

petition.

By comparison to the above section

126 analysis, in the proposed NOX SIP

call, EPA determined that sources in 22

States and the District of Columbia are

significantly contributing to 1-hr and 8-

hr nonattainment problems. In the

proposed NOX SIP call, EPA considered

nonattainment problems throughout the

Eastern half of the United States. In the

section 126 rulemaking action, EPA is

limited to considering nonattainment

problems in the 8 petitioning States,

which are all located in the Northeast.

III. Preliminary Assessment of Emission

Limitations and Compliance Schedules

The EPA is currently analyzing each

of the section 126 petitions to determine

whether to propose to grant the States’

requests for findings of significant

contribution or to deny the petitions; as

a result, EPA is not prepared to propose

a response at this time. If EPA does

propose to find that certain source

categories described in one or more of

the petitions significantly contribute to

nonattainment or interfere with

maintenance of an ozone standard in a

downwind State, then EPA would be
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24071

authorized to propose new control

requirements for those sources.

The EPA anticipates that any

requirements it may eventually propose

would resemble the controls described

in the proposed NOX SIP call. As noted

above, it is EPA’s preliminary view that

the NOX SIP call rulemaking overlaps

considerably with EPA action on the

section 126 petitions because both are

governed by the requirements of section

110(a)(2)(D) with respect to ozone for a

similar geographic region. The EPA

intends to employ the extensive analysis

in the proposed NOX SIP call action,

including the NOX Budget Trading

Program (described in a supplemental

rulemaking), in developing any

proposed remedy for the petitions.

Thus, if EPA were to propose to grant

any or all of the section 126 petitions,

EPA’s response would include the

proposal of a cap-and-trade program.

The EPA expects to base any remedy

granted under section 126 on the

assumption of a uniform control level

for the covered universe of sources,

based on the criteria delineated in

Section III.C. The following sections

outline the remedies sought by

petitioners and discuss how EPA would

address the petitions if it were to

propose granting any or all of them.

A. Remedies Recommended in Petitions

The eight petitions submitted to EPA

collectively cover the 23 jurisdictions

named by EPA in the proposed NOX SIP

call, as well as seven additional States

that were not named (Iowa, New

Hampshire, Vermont, Arkansas,

Louisiana, Mississippi, and Minnesota).

This section focuses on the source

categories named in the petitions as

significant contributors and the

requested relief sought by petitioners.

Several of these petitions reference

the OTC NOX MOU, agreed to by eleven

Northeastern States and the District of

Columbia to implement NOX emissions

reductions across the Ozone Transport

Region (OTR). The OTC NOX MOU

signatories were Maine, New

Hampshire, Vermont, Massachusetts,

Connecticut, Rhode Island, New York,

New Jersey, Pennsylvania, Maryland,

Delaware, and the District of Columbia.

The OTC NOX MOU commits these

States to reductions in ozone season

NOX emissions from large utility and

industrial combustion sources through

implementation of a phased-in

regionwide cap-and-trade program.

Specifically, affected sources in the OTR

are fossil fuel-fired boilers and other

indirect heat exchangers with a

maximum rated heat input capacity of

250 mmBtu/hr or greater, and electric

generating facilities with a rated output

of 15 megawatts (MW) or greater.

The OTC NOX MOU established

emissions reduction requirements for

these sources in the OTR, creating

emissions budgets for 1999 (Phase II)

and 2003 (Phase III). (Phase I required

the installation of reasonably available

control technology (RACT) by May

1995.) The requirements vary across

three control zones in the region: an

inner zone ranging from the District of

Columbia metropolitan area northeast to

southeastern New Hampshire (covering

all contiguous moderate and above

nonattainment areas), an outer zone

ranging out from the inner zone to

western Pennsylvania, and a northern

zone which includes much of northern

New York and northern New England

(including most of New Hampshire).

For Phase II of the OTC NOX MOU,

which begins in 1999, sources in the

inner zone are subject to emissions

reduction requirements based on the

less stringent of an emission rate of 0.20

pounds NOX per million British thermal

units of heat input (lb/mmBtu), or a 65

percent reduction from 1990 NOX

levels; sources in the outer zone are

subject to emissions reduction

requirements based on the less stringent

of a 0.20 lb/mmBtu rate, or a 55 percent

reduction from 1990 NOX levels; and

sources in the northern zone must adopt

RACT. The Phase III requirements,

which may be altered by a ‘‘mid-course

correction’’ based on new information

such as refined air quality modeling,

establish emissions reduction

requirements based on the lesser of a

0.15 lb/mmBtu rate, or a 75 percent

reduction from 1990 levels for sources

in both the inner and outer zones.

Northern zone sources would face

emissions reduction requirements based

on the lesser of a 0.20 lb/mmBtu rate,

or a 55 percent reduction from 1990

levels. In both Phase II and III in all

three zones, electric generating facilities

less than 250 mmBtu/hr but above 15

MW are subject only to a capping of

emissions at 1990 levels for purposes of

budget calculation. However, individual

States determine specific allocations for

each source from their overall budget

based on independent allocation

formulas, and thus the allocation for

these sources will not necessarily reflect

this level.

All of the section 126 petitions,

except Pennsylvania’s, Massachusetts’

and Rhode Island’s, named States in the

OTR as significant contributors.

However, only New Hampshire and

Maine requested relief beyond OTC

NOX MOU requirements from sources in

the OTR. It may be noted that the OTC

NOX MOU requirements are not

federally enforceable at this time since

these requirements have not been

adopted into SIPs.

Table 3 shows, by petitioner, the

named source categories, the named

geographic areas, and the requested

remedy sought by the petitioning States.

Please note that the named source

categories are worded as they appear in

the petitions.

TABLE—3. EPA’S SUMMARY OF SECTION 126 PETITIONS

State Named source

categories Named states Request

NY ................ Fossil fuel-fired boilers or indirect heat

exchangers with a maximum heat input

rate of 250 mmBtu/hr or greater and

electric utility generating facilities with

a rated output of 15 MW or greater.

All or parts of IN, KY, MI, NC, OH, TN,

VA, WV. Also lists OTR States DE,

MD, NJ, PA, but does not request relief.

Establish, at a minimum, emission limitations and a schedule of compliance

consistent with the OTC NOX MOU,

and a cap-and-trade program.

CT ................ Fossil fuel-fired boilers or other indirect

heat exchangers with a maximum

gross heat input rate of 250 mmBtu/hr

or greater and electric utility generating

facilities with a rated output of 15 MW

or greater.

All or parts of IN, KY, MI, NC, OH, TN,

VA, WV. Also lists OTR States DE,

MD, NJ, NY, PA, but does not request

relief.

Establish, at a minimum, emission limitations and a schedule of compliance

consistent with the OTC NOX MOU,

and a cap-and-trade program.
24072 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

TABLE—3. EPA’S SUMMARY OF SECTION 126 PETITIONS—Continued

State Named source

categories Named states Request

PA ................ Fossil fuel-fired indirect heat exchange

combustion units with a maximum

rated heat input capacity of 250

mmBtu/hr or greater, and fossil fuelfired electric generating facilities rated

at 15 MW or greater.

AL, AR, GA, IL, IN, IA, KY, LA, MI, MN,

MS, MO, NC, OH, SC, TN, VA, WV,

WI.

Establish emission limitations and a compliance schedule for a cap-and-trade

program requiring: (a) Seasonal reductions of the less stringent of 55% from

1990 baseline levels, or 0.20 lbs/

mmBtu, beginning by May 1999; (b) if

necessary, seasonal reductions of the

less stringent of 75% from 1990 baseline levels, or 0.15 lbs/mmBtu, beginning by May 2003; (c) such additional

reductions as necessary beginning in

2005.

MA ............... Electricity generating plants ..................... Parts of IN, KY, OH, WV. Also names

sources in OTR States, but does not

request relief.

Establish emissions limitation of 0.15 lbs/

mmBtu or 1.5 lbs/MWh and a compliance schedule.

RI ................. Electricity generating plants ..................... Parts of IN, KY, OH, WV. Also names

sources in OTR States, but does not

request relief.

Establish emissions limitation of 0.15 lbs/

mmBtu or 1.5 lbs/MWh and a compliance schedule.

ME ............... Electric utilities and steam-generating

units with a heat input capacity of 250

mmBtu/hr or greater.

Sources within 600 miles of Maine’s

ozone nonattainment areas (all or

parts of NC, OH, VA, WV, and OTR

States CT, DE, DC, MD, MA, NJ, NY,

NH, PA, RI, VT).

Establish compliance schedule and emissions limitation of 0.15 lbs/mmBtu for

electric utilities and the OTC NOX

MOU level of control for steam generating units, in a multi-state cap-andtrade NOX market system.

NH ............... Fossil fuel-fired indirect heat exchange

combustion units and fossil fuel-fired

electric generating facilities which emit

ten tons of NOX or more per day.

All or parts of IL, IN, IA, KY, MI, MO,

OH, VA, WV, WI. Also names sources

in OTR States CT, DE, DC, MD, MA,

NJ, NY, PA, RI.

Establish compliance schedule and emission limitations no less stringent than:

(a) Phase III OTC NOX MOU reductions; and/or (b) 85% reductions from

projected 2007 baseline; and/or (c) An

emission rate of 0.15 lbs/mmBtu.

VT ................ Fossil fuel-fired electric utility generating

facilities with a maximum gross heat

input rate of 250 mmBtu/hr or greater

and potentially other unidentified major

sources.

All or parts of IL, IN, KY, MI, NC, OH,

TN, VA, WV. Also AL GA, IA, MO, SC,

WI. Also names OTR sources, but

does not request relief.

Establish emissions limitation of 0.15 lbs/

mmBtu or 1.5 lbs/MWh and a compliance schedule.

The petitions vary somewhat with

regard to the universe of sources they

name as significant contributors to their

ozone problem. Three of the petitioning

States—New York, Connecticut, and

Pennsylvania—name the same universe

of sources covered by the OTC NOX

MOU. New Hampshire names fossil

fuel-fired indirect heat exchangers and

electric generating facilities as well, but

uses a tonnage applicability cut-off to

include only sources that emit ten tons

or more of NOX per day. Massachusetts

and Rhode Island name ‘‘electricity

generating plants’’ as the universe

requiring controls, without naming a

specific size cutoff. Finally, Vermont

names fossil fuel-fired electric

generating facilities of 250 mmBtu or

greater.

The petitions also vary regarding the

remedy requested. Though all of the

petitions request that EPA impose

controls in terms of various emissions

limitations, four of the eight petitions—

New York, Connecticut, Pennsylvania,

and Maine—also request that a trading

program with a cap, or emissions

budget, be established to implement

these controls. Massachusetts, Rhode

Island, and Vermont request that

limitations be established for all named

sources at 0.15 lbs/mmBtu, which is the

level of control for electric generating

facilities used to calculate the budget in

the proposed NOX SIP call. Maine

requests an emission limitation of 0.15

lbs/mmBtu for named electric utilities,

but the OTC NOX MOU level of control

for named steam generating units. New

Hampshire requests emission

limitations no less stringent than the

Phase III OTC NOX MOU reductions,

and/or 85 percent reductions from

projected 2007 baseline, and/or an

emission rate of 0.15 lbs/mmBtu. New

York, Connecticut and Pennsylvania all

request that emissions limitations

consistent with the OTC NOX MOU be

imposed on named sources, but only

Pennsylvania specifies the outer zone

requirements; neither Connecticut nor

New York specifies a zone. The level of

reduction requested for 2003 in these

three petitions specifying basic OTC

NOX MOU requirements appears to be

less stringent than that in the petitions

requesting 0.15 lbs/mmBtu, since the

remedy requested would allow sources

the option to implement the less

stringent of a percentage reduction or an

emission rate. In terms of smaller

sources named by these three States,

Pennsylvania’s petition appears to seek

somewhat more reductions than the

OTC NOX MOU by requiring the same

emission level for electric generating

facilities less than 250 mmBtu/hr and

greater than 15MW as for larger units.

Both Connecticut and New York appear

to be aligned with the OTC NOX MOU

in seeking only a capping of emissions

at 1990 levels for these smaller sources.

New York, Connecticut and

Pennsylvania recommend a date for the

implementation by sources of control

requirements: the OTC NOX MOU

schedule of compliance, including its

phased-in controls and implementation

dates of 1999 and 2003. The remaining

States request that EPA establish a

schedule of compliance requiring

sources to comply with emission

limitations as expeditiously as

practicable.

B. EPA’s Analytic Approach

If EPA proposes to grant a section 126

petition, and thereby proposes to find

that identified sources either contribute
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24073

10As indicated earlier, it is EPA’s preliminary

interpretation that the cross reference in section

126(b) to section 110(a)(2)(D) should be treated as

a cross reference to sentence (i) of the provision,

which includes the significant contribution test.

significantly to nonattainment or

interfere with maintenance in the

petitioning State, EPA intends to

propose emissions reduction

requirements for those sources. The EPA

would not, however, propose controls

on sources other than those named in

the petitions under section 126.

To determine the level of

requirements to propose, EPA intends to

consider the remedies described in the

petitions (see III.A. of this section),

relevant comments received in a timely

manner on today’s notice, the

availability and cost effectiveness of

potential control measures, the ambient

impact of the control measures, OTAG’s

recommendations, and the similar

efforts EPA is already undertaking to

address the transport problem in the

proposed NOX SIP call.

In developing proposed budgets for

States as part of the proposed NOX SIP

call, EPA assumed the application of a

uniform NOX emission rate of 0.15 lb/

mmBtu to projected electricity

generating activity levels at large

electric generating devices, and 70

percent control for other large stationary

sources. The EPA’s rationale for

assuming these control levels is

explained in the proposed NOX SIP call,

and is based upon cost effectiveness,

OTAG recommendations, the collective

contribution approach described in the

NOX SIP call notice, equity concerns,

EPA’s air quality modeling approach,

and concerns over emissions shifting

(62 FR 60342).

The EPA believes that it needs to

coordinate and integrate the proposed

NOX SIP call and the section 126

rulemaking to the greatest extent

possible in order to reduce the

possibility that affected sources would

be faced with inconsistent or conflicting

control requirements and deadlines.

Such inconsistency could hamper the

sources’ abilities to plan and achieve the

needed reductions as cost-effectively as

possible. Further discussion of the

proposed integration of these two efforts

is included in Section IV.B.

The EPA believes that promoting

consistent requirements among the

States affected by the NOX SIP call and

the section 126 rulemaking would

greatly facilitate participation in a

common trading program to address the

transport problem on a regional scale.

Therefore, EPA anticipates that any

section 126 proposed rulemaking will

attempt to coordinate the schedules for

the SIP revisions, and the

implementation of reductions required

under the proposed NOX SIP call, with

the schedule for completing the

rulemaking on the section 126 petitions

in accordance with the consent decree

proposed by the petitioning States and

EPA.

In determining the appropriate

control requirements to propose in

response to the granted section 126

findings, EPA would use the same cost

effectiveness approach that it used in

the proposed NOX SIP call with respect

to stationary sources. In the upcoming

proposed rulemaking for the section 126

petitions, EPA intends to present

analyses conducted for the proposed

NOX SIP call regarding the feasibility,

performance, and cost of NOX controls,

and factor this into the control level

recommendation. The application of

this control level would determine the

allocation of NOX allowances each

source would receive under a trading

program.

The EPA’s preliminary assessment is

that it would propose the control levels

assumed in formulating the budgets for

the proposed NOX SIP call in response

to the section 126 petitions. In addition,

EPA’s preliminary assessment is that it

would propose the full 3-year period for

sources to implement those controls.

Comments are sought on these

approaches, as indicated in Section IV

of today’s notice.

Also in the proposal, EPA intends to

use the Integrated Planning Model (IPM)

to explore the cost of achieving

emission levels among sources affected

by the section 126 rulemaking. The EPA

uses the IPM to evaluate the emissions

and cost impacts expected to result from

the requirements of the proposed NOX

SIP call on the electric power generation

sector. The IPM has been used for over

10 years to address a wide range of

electric power market issues, including

environmental policy and compliance

planning, and undergoing frequent and

extensive review and validation. The

EPA has used IPM for many analytic

efforts, most recently as a tool to analyze

alternative trading and banking

programs during the OTAG process in

1996 and 1997, and to analyze the

economic impacts of the proposed NOX

SIP call.

C. Intent To Implement Controls

Through Cap-and-Trade Program

A cap-and-trade program is expected

to be the most cost-effective approach to

achieving any emissions reductions

required under section 126. Under such

a program, the sources for which EPA

proposes a positive finding would be

limited to specified amounts of

emissions as a group, but would be

authorized to trade emissions. Four of

the eight petitioning States (New York,

Connecticut, Pennsylvania, and Maine)

requested that EPA establish such a

trading program to implement the

required reductions. The EPA is

proposing a framework for a cap-andtrade program in a supplemental notice

to the proposed NOX SIP call to

facilitate cost effective achievement of

the proposed reductions, (‘‘Purpose of

the NOX Budget Trading Program’’ and

‘‘Benefits of Participating in the NOX

Budget Trading Program’’). If one or

more of the section 126 petitions are

granted, a remedy can be integrated

with this program, consolidating the

two actions and lowering the cost of

compliance.

The EPA anticipates defining all the

program elements for a cap-and-trade

program in the proposed rulemaking for

the section 126 petitions, including a

list of covered sources, monitoring

requirements for these sources, an

allowance allocation methodology,

source-specific NOX allowance

allocations for the initial control period,

timing of the program, and permitting

requirements.

IV. Legal and Policy Issues

A. Issues Involving Significant

Contribution

As discussed earlier in Sections I.A

and I.C. of this notice, both the section

126 petitions and proposed NOX SIP

call are premised on a violation of

section 110(a)(2)(D) of the CAA. This

section requires that SIPs prohibit

emissions that contribute significantly

to nonattainment or that interfere with

maintenance downwind.10 Because of

the link between section 126 and

section 110, EPA should use similar

criteria in its analysis for each case.

As described in the proposed NOX SIP

call and earlier in this notice, EPA used

a ‘‘weight of evidence’’ approach in

determining whether sources in one

State significantly contributed to ozone

nonattainment in another State. This

approach applies multiple factors which

focus on emission quantities and air

quality impacts, as well as, under

certain formulations, control costs. It is

EPA’s intent to use this same ‘‘weight of

evidence’’ approach in determining

whether or not to grant any of the

section 126 petitions.

The EPA is soliciting comment on

whether there is any reason why it

should rely on a different approach and,

if so, what that approach should be. It

should be noted that EPA is not

soliciting comment on the issues of

significant contribution discussed in the

proposed NOX SIP call. It is only asking
24074 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

for comment on whether or not the same

approach should be used in evaluating

the section 126 petitions.

Additionally, EPA is asking for

comment on whether it should focus on

the contributions to the downwind areas

of named sources in a each petition,

considered by themselves, or whether

EPA should consider the named sources

in one petition in conjunction with the

named sources in all the other petitions

under a type of ‘‘collective

contribution’’ approach. In the latter

case, even if the emissions from the

named sources in a single petition have

a relatively minor impact on downwind

areas, the emissions may be considered

significant if they are considered as part

of a broader set of emissions from all the

sources named in all the petitions,

which together have a larger impact on

the same downwind areas.

B. Issues Involving Trading

The EPA is proposing the framework

for a cap-and-trade program in its

supplemental notice to the proposed

NOX SIP call. As noted previously, EPA

believes a trading program should be

part of any remedy it proposes in

response to the section 126 petitions. At

this time, EPA is not prepared to define

the scope of the trading program it

would propose in response to the

section 126 petitions, but would like to

solicit comment on some important

issues regarding trading program

development.

First, EPA believes that when a

petition identifies as significant

contributors both named sources and

generally identified source categories,

EPA may make findings of significant

contribution, apply controls, and

implement a trading program, with

respect to all sources within those

source categories in geographic areas

named in the petitions. Second, EPA

foresees that the proposed response to

the section 126 petitions would

resemble the proposed NOX Budget

Trading Program in EPA’s supplemental

proposed NOX SIP call and that the two

efforts could be integrated into one

common trading program. Under this

common trading program, sources

subject to controls under the section 126

rulemaking, or sources in States

choosing to participate in the NOX

Budget Trading Program in response to

the NOX SIP call, or sources in States

subject to a Federal implementation

plan (FIP) under the NOX SIP call, could

trade with one another under a

regionwide NOX cap. The EPA solicits

comments as to whether the trading

program that EPA would propose in

response to the section 126 petitions

should be essentially the same trading

program proposed by EPA in its

proposed NOX SIP call, and whether

there are any reasons why the programs

should not be integrated.

In order to address the ozone

transport problem in the most costeffective manner, EPA believes one

trading program can and should be

established in response to both the final

NOX SIP call and the section 126

petitions. The EPA believes that there

are two principal criteria that sources

must meet to be eligible to participate in

a cap-and-trade program, as stated in the

supplemental notice for the proposed

NOX SIP call. The first criterion requires

that sources be able to account

accurately and consistently for all of

their emissions to ensure the trading

program goal of maintaining emissions

within a cap. The second criterion for

participation in a trading program is the

ability to identify a responsible party for

each regulated source who would be

accountable for demonstrating and

ensuring compliance with the program’s

provisions. The EPA solicits comment

on these, or additional, criteria that

should be considered. Assuming that

these criteria are met, and consistent

control levels are used in setting

emission requirements for the affected

sources, EPA supports the establishment

of a common trading program for all

sources in States subject to the final

NOX SIP call who hold EPA-approved

SIPs and choose to participate, and all

sources subject to any section 126

remedy established by EPA. The EPA

would administer this common trading

program in collaboration with affected

States. The EPA anticipates proposing to

establish the geographic boundaries of

the common trading program as those

States submitting SIPs in response to the

final NOX SIP call or subject to FIPs

and/or the sources in geographic areas

for which EPA makes a finding for the

section 126 petitions.

A common trading program

integrating the NOX Budget Trading

Program and the section 126 actions

would necessarily include those source

categories in States for which EPA

makes a finding in the section 126

process, sources located in States that

are both named in the final NOX SIP

Call and which choose to participate in

the NOX Budget Trading Program, as

well as sources subject to a FIP. States

choosing to participate through the NOX

SIP call would be required to include a

core group of sources in the trading

program, but would be provided the

option to include additional stationary

source categories, and certain qualifying

individual stationary sources would be

provided the opportunity to opt in.

Sources subject to section 126 findings

would be required to participate in the

common trading program under EPA’s

section 126 authority. However, EPA

does not believe that section 126

provides EPA authority to make

findings or require controls beyond the

named sources or source categories in

the petitions. The EPA seeks comment

on this issue of whether it may include

additional sources beyond the named

sources or source categories in the

petitions through the section 126

remedy. Specifically, EPA requests

comment on whether the sources EPA

includes in the common trading

program under the section 126 petitions

should be confined to source categories

in geographic areas for which

petitioning States request, and EPA

grants, a finding of significant

contribution. In the alternative, EPA

requests comment as to whether

additional sources not named in a

petition, but located in a State where a

finding is made under section 126,

should be able to voluntarily participate

in a trading program remedy. Further,

EPA requests comment on whether such

a trading program may include sources

in other States subject to the NOX SIP

call.

Because sources may be included in

the common trading program through

one of three possible mechanisms

(section 126 petitions, NOX SIP Call,

and FIP), the sources included in the

trading program for purposes of the NOX

SIP call may vary from sources included

for purposes of the section 126 remedy.

The EPA solicits comment as to whether

this is problematic for integration

concerns.

The EPA does not anticipate that a

trading program designed for sources

subject to the final NOX SIP call and the

section 126 petitions for which EPA

makes a finding could be expanded

geographically to include sources in

geographic areas not subject to

requirements under either program. The

EPA solicits comment on this

preliminary view.

The effect of NOX emissions on air

quality in downwind nonattainment

areas depends, in part, on the distance

between sources and receptor areas.

Sources that are closer to the

nonattainment areas tend to have much

larger effects on air quality than sources

that are far away. In light of this and as

discussed in Section IV.C, the EPA

plans to evaluate alternative

approaches, other than one based on the

application of uniform controls, in

developing the rulemaking proposal.

The Agency solicits comments on

whether a trading program should factor

in differential effects of NOX emissions

in an attempt to strike a balance
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24075

between achieving the cost savings from

a broader geographic scope of trading

and avoiding the adverse effects on air

quality that could result if the

geographic domain for trading is

inappropriately large or trades across

areas are not appropriately adjusted to

reflect differential environmental

effects. The EPA could consider

establishing ‘‘exchange ratios’’ for tons

traded between areas. The large number

of areas in the petitioning States that are

violating the standards and the several

different weather patterns associated

with summertime ozone pollution

episodes complicate the development of

a stable set of trading ratios.

Alternatively, the Agency could

consider establishing subregions for

trading within the geographic area that

may ultimately be subject to any section

126 findings and apply a discount to or

prohibit trades between regions. The

Agency solicits comments on this issue.

C. Cost-Effectiveness Issues

Where EPA proposes to grant a

section 126 petition and, therefore, also

to propose control measures, it plans to

use the cost-effectiveness approach used

in the proposed NOX SIP call action

with respect to stationary sources. This

approach focuses on the selection of

reasonable, cost-effective control

measures and the application of uniform

controls. Further, as in the proposed

NOX SIP call, EPA plans to propose to

require sources in upwind areas to

decrease emissions through costeffective controls that compare

favorably, at least qualitatively, with the

costs of controls downwind and that

reduce ozone levels downwind.

However, the effect of NOX emissions

on air quality in areas violating the

ozone air quality standard depends, in

part, on the distance between sources

and receptor areas. Sources that are

closer to areas violating the air quality

standards tend to have larger effects on

air quality than sources that are far

away. If there is a significant variation

in the contribution of emissions in

different subregions within the

geographic area that may be subject to

any section 126 findings, alternative

approaches to developing a remedy,

other than one based on the application

of uniform control measures, will be

evaluated. On the other hand, the large

number of nonattainment areas in the

States that filed petitions and the

several different weather patterns

associated with summertime ozone

pollution episodes should also be

considered when evaluating a

subregional approach. The EPA plans to

evaluate alternative approaches at levels

below and above the levels used in the

calculation of the budgets in the

proposed NOX SIP call as well as

regional approaches that apply different

control levels to different geographic

regions.

The EPA is soliciting comment on

approaches for the section 126 control

remedy that factor in the differential

effects on air quality in areas violating

the standard. Comments advocating

alternative approaches would be most

helpful if they set forth concrete

proposals on what analysis should form

the basis of the remedy. For example,

some have suggested an approach that

would attempt to quantify more

explicitly the cost-effectiveness of

emissions reductions in terms of

improvements in ambient ozone

concentrations in areas violating a

standard (measures, for example, as cost

per population-weighted changes in

parts per billion peak ozone

concentration) taking into account the

location of control measures through

subregional modeling.

The EPA invites comment on whether

the criteria for cost effectiveness applied

in any section 126 petition decision

should be the same as the criteria used

in the proposed NOX SIP call action; or

whether the criteria should be different

because, for example, there are fewer

sources involved in the section 126

petitions than in the proposed NOX SIP

call. (The EPA is not asking for

comment, in this notice, on the issue of

cost effectiveness as it applies to the

proposed NOX SIP call, but only on

whether the approach taken in the

proposed NOX SIP call is appropriate for

the section 126 action.) Similarly, EPA

invites comment on whether to consider

the cost effectiveness of controls for

sources named in a single petition or

whether EPA should look at the

collective cost effectiveness of controls

for all the sources named in all the

petitions which EPA may propose to

grant. In both cases, even if some

sources’ emissions reduction

requirements taken by themselves are

not cost effective, EPA believes that

these controls may be considered cost

effective if they are part of a set of

controls which, when taken as a whole,

are considered cost effective.

The EPA also invites comments on

whether and to what extent cost

effectiveness should differentiate

between large and small sources within

a specific source category. Specifically,

EPA notes that its proposed NOX SIP

call included a cutoff of 25 MWe for

utility boilers and 250 mmBtu for nonutility boilers; units below these cutoffs

were not included in emissions decrease

calculations for the statewide budgets.

Because certain petitions suggest

controlling 15–25 MWe generators, and

one suggests controlling all electric

generators, EPA specifically invites

comment on the cost effectiveness of

these requests.

As a preliminary matter, EPA

anticipates making determinations as to

cost effectiveness through the same

approach as discussed in the proposed

NOX SIP call. Specifically, EPA would

employ the following steps in proposing

the control levels: First, EPA would

compile a list of available NOX control

measures for the various emissions

sectors named in the petitions. For the

control measures on this list, EPA

would estimate the average cost

effectiveness of those controls. The

average cost effectiveness is defined as

the cost of a ton of reductions from the

source category based on full

implementation of the proposed

controls, as compared to the pre-existing

level of controls.

Second, EPA would determine the

average cost effectiveness of a

representative sample of recently

proposed and adopted State and Federal

controls. The EPA believes that the

average cost effectiveness for measures

that would form the basis of the remedy

to the petitions should be comparable to

the average cost effectiveness of those

controls recently proposed and adopted.

Third, EPA would use this information

to determine which controls may be

appropriate to propose as the remedy for

any petitions that are proposed to be

granted. Fourth, EPA would determine

that the proposed controls—or generally

comparable levels—result in an

adequate level of ambient reductions

downwind. The EPA used this approach

to propose the level of control assumed

in the proposed NOX SIP call. The EPA

solicits comments on whether this

approach should be changed in the

section 126 rulemaking.

D. Legal Issues

The EPA also solicits comment on a

series of issues concerning the legal

interpretation of section 126(b) and

associated provisions. Section 126(b)

provides that a State may petition EPA

for a finding that specified sources in

other States emit air pollutants ‘‘in

violation of the prohibition of section

110(a)(2)(D)(ii) of this title or this

section.’’ Section 110(a)(2)(D) provides

the requirement that a SIP contain

adequate provision:

(i) prohibiting, consistent with the

provisions of this title, any source or other

type of emissions activity within the State

from emitting any air pollutant in amounts

which will—

(I) contribute significantly to

nonattainment in, or interfere with
24076 Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules

maintenance by, any other State with respect

to [any] national * * * ambient air quality

standard, or

(II) interfere with measures required to be

included in the applicable implementation

plan for any other State under part C to

prevent significant deterioration of air quality

or to protect visibility.

(ii) insuring compliance with the

applicable requirements of sections 126 and

115 (relating to interstate and international

pollution abatement)* * *

One issue is whether the crossreference in section 126(b) to ‘‘section

110(a)(2)(D)(ii)’’ is valid, or instead

should be considered to be a

typographical error that should be read

to refer to section 110(a)(2)(D)(i). The

EPA has offered this view in general and

preliminary guidance. (Nichols Letter

cited earlier in Section I.B.)

Some have argued that section 126(b)

should be read literally, and that this

reading would require EPA to deny the

petitions submitted to date on grounds

that section 126 allows a State to file a

petition with EPA only to force other

States to meet the requirements of

section 126 itself, (i.e., the requirement

in section 126(a) that SIPs include

provisions to require new and modified

major stationary sources to give

preconstruction notification to nearby

States under certain circumstances).

(Letter from Henry V. Nickel, et.al,

Counsel for the Utility Air Regulatory

Group, to Carol M. Browner,

Administrator, U.S. EPA, November 21,

1997 (UARG Letter); Letter from Betty D.

Montgomery, Attorney General of Ohio,

et. al., to Richard Wilson, Acting

Assistant Administrator for Air &

Radiation, U.S. EPA, November 5, 1997

(letters included in the docket to this

rulemaking).)

If the proper interpretation of section

126(b) is that the cross-reference

represents a typographical error, an

issue arises as to what the appropriate

cross-reference should be. The EPA has

offered the view, in general and

preliminary guidance, that the proper

cross-reference should be to section

110(a)(2)(D)(i) (Nichols Letter). Some

have argued that the appropriate crossreference should be to section

110(a)(2)(D)(i)(II), and not section

110(a)(2)(D)(i)(I) (UARG letter). The

effect of this reading would be to limit

section 126 petitions to cases in which

the upwind sources are adversely

affecting: (i) Clean areas under the

prevention of significant deterioration

requirements of part C of Title I of the

CAA; or (ii) visibility.

A further issue arises as to the

interpretation of the requirement of

section 110(a)(2)(D)(i) that the ‘‘SIP

contain adequate provisions prohibiting,

consistent with the provisions of this

title,’’ sources from emitting air

pollutants in amounts that contribute

significantly to nonattainment problems

downwind. Some have argued that the

phrase ‘‘consistent with the provisions

of this title’’ should be interpreted to

limit the requirements imposed with

respect to sources in a contributing State

to the control requirements that the

petitioning State demonstrates would be

necessary to allow the petitioning State

to reach attainment of the NAAQS after

the petitioning State implements the

applicable requirements under section

182 (requirements for nonattainment

areas), and under sections 176A and 184

(transport region provisions). The EPA

solicits comments on each of the issues

of interpretation noted earlier.

Additional legal issues, which assume

that section 126(b) should be read to

authorize EPA to grant the petitions if

they have an adequate technical basis,

concern:

• Whether, if EPA grants a section

126 petition, EPA may allow sources a

period longer than 3 years from the date

of granting the petition to implement

required controls under section 126(c).

• Whether administrative complexity

is an appropriate factor to consider in

determining whether to grant a petition

with respect to certain sources, so that

EPA would have the discretion to

determine not to grant a finding with

respect to, for example, smaller sources

that would be administratively complex

for EPA to regulate.

• Whether EPA should evaluate each

of the section 126 petitions under both

the 1-hr ozone NAAQS and the 8-hr

ozone NAAQS or whether EPA should

limit its evaluation of the 8-hr standard

only to those petitions which cite the 8-

hr standard as a basis for their petition.

• Whether EPA has the authority to

evaluate petitions under the 8-hr

standard in light of the fact that EPA has

not yet designated areas under the 8-hr

standard or required SIP revisions under

that standard.

• Whether EPA, in determining

whether sources are significant

contributors to nonattainment problems

downwind, may consider the impact of

upwind sources named in a petition on

only the petitioning State, or whether

EPA may consider the impact of upwind

sources named in one petition on other

petitioning States (or non-petitioning

States).

V. Schedule for Rulemaking Action on

Section 126 Petitions

As discussed in the Section I

Background, the eight petitioning States

have sued EPA to establish a schedule

for rulemaking on the section 126

petitions, and EPA and those States

have filed with the court a proposed

consent decree. The EPA took comment

on the proposed consent decree under

section 113(g) of the CAA and is

considering those comments. The EPA

has not asked the court to lodge the

consent decree.

Section 2(b) of the proposed consent

decree requires that EPA publish in

today’s ANPR ‘‘the schedule set forth in

[the] consent decree for finalizing action

on the section 126 petitions, including

the date and location of the public

hearing.’’

The proposed consent decree sets

forth the relevant schedule as follows:

3. EPA will publish in the Federal Register

a notice of proposed rulemaking regarding

the section 126 petitions no later than

September 30, 1998.* * *

5. a. EPA will take a final action on the

section 126 petitions no later than April 30,

1999.

b. Unless EPA takes the final action

described in paragraph 6, as to each

individual petition, EPA’s final action will be

to—

(i) Grant the requested finding, in whole or

part; and/or

(ii) Deny the petition, in whole or part.

c. Unless EPA denies a petition in whole,

its final action will include promulgation of

the Proposed Remedy for sources to the

extent that a requested finding is granted

with respect to those sources.

6. EPA shall be deemed to have complied

with the requirements of Paragraph 5(a) if it

instead takes a final action by April 30, 1999,

that—

a. Makes an affirmative determination

concerning the technical components of the

‘‘contribute significantly to nonattainment’’

or ‘‘interfere with maintenance’’ tests under

CAA section 110(a)(2)(D)(i), 42 U.S.C. sec.

7410(a)(2)(D)(i);

b. Further provides that—

(i) If EPA does not issue a proposed

approval of the relevant upwind State’s SIP

revision (submitted in response to the NOX

SIP call) by November 30, 1999, then the

finding will be deemed to be granted as of

November 30, 1999, without any further

action by EPA;

(ii) If EPA issues a proposed approval of

said SIP revision by November 30, 1999, but

does not issue a final approval of said SIP

revision by May 1, 2000, then the finding

will be deemed to be granted as of May 1,

2000, without any further action by EPA;

(iii) If EPA issues a final approval of said

SIP revision by May 1, 2000, EPA must take

any and all further actions, if necessary to

complete its action under section 126, no

later than May 1, 2000; and

c. Promulgates the Proposed Remedy for

sources to the extent that an affirmative

determination is made with respect to those

sources.

A public hearing on the future

proposed rulemaking on the section 126

petitions will be held on October 28 and

29, 1998 at the EPA Auditorium at 401

M Street SW,
Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 / Proposed Rules 24077

Washington, DC, 20460. The oral

testimonies, as well as all written

comments received during the comment

period for the proposed rulemaking,

will be considered in the development

of the final rulemaking.

VI. Impact on Small Entities

The Regulatory Flexibility Act (RFA),

5 U.S.C. 601 et seq., provides that

whenever an agency is required to

publish a general notice of proposed

rulemaking, it must prepare and make

available a regulatory flexibility

analysis, unless it certifies that the

proposed rule, if promulgated, will not

have ‘‘a significant economic impact on

a substantial number of small entities.’’

Id., section 605(b).

No such requirements or certification

apply in the case of an advance notice

of proposed rulemaking. However, in

accordance with section 609(a)(1) of the

RFA, EPA is today notifying the public

that if EPA grants the findings requested

by the petitioning States, the controls

that EPA would promulgate may have a

significant economic impact on a

substantial number of small entities.

Accordingly, EPA has begun an

informal outreach process to work with

the Small Business Administration

(SBA), the Office of Management and

Budget (OMB), and a number of smallentity representatives. On April 14,

1998, EPA held a meeting in

Washington, D.C. to provide an

opportunity for small-entity

representatives to provide advice and

recommendations and to join in a

discussion of the issues related to smallentities. Representatives from SBA and

OMB also participated in the meeting. If

this outreach and further analysis show

that EPA’s action appears likely to have

a significant adverse impact on a

substantial number of small entities,

EPA would then convene a Federal

Small Business Advocacy Panel for this

rulemaking under the Small Business

Regulatory Enforcement Fairness Act

(SBREFA). The EPA would examine

such issues as the number of small

entities likely to be affected by the rule;

the associated compliance, reporting

and recordkeeping burdens; Federal

rules which might duplicate, overlap, or

conflict with the rule; and alternative

compliance strategies and approaches

that would help to minimize any

significant economic impact on small

entities.

Dated: April 24, 1998.

Carol M. Browner,

Administrator.

[FR Doc. 98–11475 Filed 4–29–98; 8:45 am]

BILLING CODE 6560–50–P