**UNITED STATES ENVIRONMENTAL PROTECTION AGENCY**

**REGION IX AIR DIVISION**

Technical Support Document

for

EPA’s Proposed Rulemaking

for the

Nevada State Implementation Plan

Stationary Source Permitting Rules

Prepared by: Laura Yannayon, Jeff Wehling

March 21, 2007**TABLE OF CONTENTS Page**

I. SUMMARY OF RECOMMENDATIONS 1

II. BACKGROUND 6

III. EPA EVALUATION CRITERIA 10

IV. DISCUSSION OF SUBMITTED RULES 10

V. EPA EVALUATION OF SUBMITTED RULES 39

A. COMPLIANCE WITH MINIMUM REQUIREMENTS ESTABLISHED IN CAA SECTIONS 110(a)(2), 110(l), AND 193 40

B. COMPLIANCE WITH MINIMUM REQUIREMENTS ESTABLISHED
FOR STATIONARY SOURCE PERMIT PROGRAMS IN 40 CFR PART 51 (“REQUIREMENTS FOR PREPARATION, ADOPTION,AND SUBMITTAL OF IMPLEMENTATION PLANS”), SUBPART I (“REVIEW OF NEW SOURCES AND MODIFICATIONS”), EXCLUDING 40 CFR 51.165 AND

51.166 44

C. OTHER ISSUES 53

VI. EVALUATION OF STATE REQUEST TO RESCIND CERTAIN
PERMIT-RELATED RULES AND STATUTES 54

VII. ATTACHMENTS 60

A. SUBMITTED NDEP RULES

B. SIP NDEP RULES1 **I. SUMMARY OF RECOMMENDATIONS**

On January 12, 2006, the Nevada Division of Environmental Protection (NDEP), the Governor’s designee under the Federal Clean Air Act (“Act” or CAA,) for submittals of revisions to the Nevada State Implementation Plan (SIP) submitted new and amended rules related to stationary source permitting for approval as part of the SIP. Some of these rules were amended by the State Environmental Commission on September 6, 2006 and resubmitted to EPA (as amended) on December 8, 2006. These rules represent a comprehensive update to the State’s stationary source permitting program and are intended to satisfy all of the requirements under CAA section 110(a)(2)(C) of the Clean Air Act (CAA or “Act”), excluding the requirements for major sources and major modifications under parts C and D of title I of the Act. The State also requested rescission of certain permit-related rules in the existing SIP.

This section of the Technical Support Document (TSD) summarizes the recommendations made herein by referring to three basic groups of rules: “submitted rules,” “rules for which rescission is requested,” and “superseded rules.” The set of
“submitted rules” is further divided into those that are “separable” from the other submitted rules, which are considered in their entirety and not individually. By “separable,” EPA means that the action it anticipates taking will not result in the approved rule(s) being more stringent than the State anticipated. See EPA memorandum from John Calcagni, Office of Air Quality Planning and Standards, entitled “Processing of State Implementation Plan (SIP) Submittals,” dated July 9, 1992.

**SUBMITTED RULES**

Separable rules (7) Three are recommended for approval, and four are recommended for full disapproval. Recommendations are shown in
**CAPITALIZED, BOLD** type

.

**Definitions (4) –**  NAC 445B.196 – “Toxic regulated air pollutant” defined.

**FULL DISAPPROVAL.**  NAC 445B.021 – “Area source” defined. **FULL DISAPPROVAL.**  NAC 445B.028 – “Best available control technology” defined.

**FULL DISAPPROVAL.**  NAC 445B.178 – “Source reduction” defined. **FULL DISAPPROVAL.** 2 **General Provisions (3) –**  NAC 445B.22083 – Construction, major modification or relocation

of plants to generate electricity using steam produce by burning of fossil fuels. **APPROVAL.** NAC 445B.250 - Notification of planned construction or

reconstruction. **APPROVAL.** NAC 445B.252 - Testing and sampling. **APPROVAL.**

Non-separable Rules (87) The program set forth in the following rules is considered in its entirety and is recommended for **FULL DISAPPROVAL.** 

**Definitions (42) –**  NAC 445B.003 – “Adjacent properties” defined. NAC 445B.0035 – “Administrative revision to a Class I operating

permit” defined.
NAC 445B.007 – “Affected state” defined.
NAC 445B.013 – “Allowable emissions” defined.
NAC 445B.014 – “Alteration” defined. NAC 445B.016 – “Alternative operating scenarios” defined. NAC 445B.019 – “Applicable requirements” defined. NAC 445B.035 – “Class I-B application” defined.
NAC 445B.036 – “Class I source” defined.
NAC 445B.037 – “Class II source” defined.
NAC 445B.038 – “Class III source” defined.
NAC 445B.044 – “Construction” defined. NAC 445B.046 – “Contiguous property” defined. Sec. 2 of Regulation R096-05 – “Dispersion technique” defined. Sec. 3 of Regulation R096-05 – “Excessive concentration”

defined. NAC 445B.066 – “Existing stationary source” defined. NAC 445B.068 – “Facility” defined. NAC 445B.069 – “Federally enforceable” defined. NAC 445B.070 – “Federally enforceable emissions cap” defined. NAC 445B.082 – “General permit” defined. Sec. 4 of Regulation R096-05 – “Good engineering practice stack

height” defined.
NAC 445B.087 – “Increment” defined. NAC 445B.093 – “Major modification” defined. NAC 445B.094 – “Major source” defined. NAC 445B.0945 – “Major stationary source” defined.
NAC 445B.099 – “Modification” defined.
NAC 445B.104 – “Motor vehicle” defined. Sec. 5 of Regulation R096-05 – “Nearby” defined. NAC 445B.108 – “New stationary source” defined.
NAC 445B.117 – “Offset” defined. NAC 445B.123 – “Operating permit” defined.3 NAC 445B.124 – “Operating permit to construct” defined. NAC 445B.1345 – “Plantwide applicability limitation” defined.
NAC 445B.138 – “Potential to emit” defined. NAC 445B.142 – “Prevention of significant deterioration of air

quality” defined. NAC 445B.147 – “Program” defined. NAC 445B.154 – “Renewal of an operating permit” defined. NAC 445B.156 – “Responsible official” defined. NAC 445B.157 – “Revision of an operating permit” defined. NAC 445B.179 – “Special mobile equipment” defined. NAC 445B.187 – “Stationary source” defined. NAC 445B.194 – “Temporary source” defined.

**Operating Permits Generally (18) -**  NAC 445B.287 – Operating permits: general requirements;

exception; restriction on transfers. NAC 445B.288 – Operating permits: exemptions from requirements; insignificant activities. NAC 445B.295 – Application: General requirements. NAC 445B.297 – Application: submission of application and

supplementary or corrected information. NAC 445B.298 – Application: official date of submittal. NAC 445B.305 – Operating permits: imposition of more stringent

standards for emissions. NAC 445B.308 – Prerequisites and conditions for issuance of

operating permits: environmental evaluation; compliance with control strategy; exemption from environmental evaluation. NAC 445B.310 – Environmental evaluation: applicable sources. NAC 445B.311 – Environmental evaluation: required information. NAC 445B.313 – Method for determining heat input: class I

sources. NAC 445B.3135 – Method for determining heat input: class II

sources. NAC 445B.314 – Method for determining heat input: class III

sources. NAC 445B.315 – Contents of operating permits: exception for

operating permits to construct; required conditions. NAC 445B.318 – Operating permits: separate permit required for

each source; form of application; issuance or denial of permit; posting of permit. NAC 445B.319 – Operating permits: administrative amendment. NAC 445B.325 – Operating permits: Termination, reopening and

revision, revision, or revocation and reissuance. NAC 445B.326 – Operating permits: assertion of emergency as

affirmative defense to action for noncompliance. NAC 445B.331 – Request for change of location of emission unit.4 **Class I Operating Permits (16) -**  NAC 445B.3361 – General requirements. NAC 445B.3363 – Operating permit to construct: application. NAC 445B.33637 – Operating permit to construct for approval of

plantwide applicability limitation: Application. NAC 445B.3364 – Operating permit to construct: review of

application and determination of completeness by director;
notice. NAC 445B.3365 – Operating permit to construct: required

conditions. NAC 445B.33656 – Operating permit to construct for approval of

plantwide applicability limitation: required conditions and
information. NAC 445B.3366 – Operating permit to construct: expiration;

extension. NAC 445B.3368 – Application: additional requirements; exception. NAC 445B.3375 – Class I-B application: filing requirement. NAC 445B.3395 – Review of application and determination of

completeness by director; notice; expiration of permit. NAC 445B.340 – Prerequisites to issuance, revision or renewal of

permit. NAC 445B.342 – Revision of permit: exception when making certain

changes; notification of changes. NAC 445B.3425 – Minor revision of permit. NAC 445B.344 – Significant revision of permit. NAC 445B.3441 – Administrative revision of permit to incorporate

conditions of certain permits to construct. NAC 445B.3443 – Renewal of permit.

**Class II Operating Permits (6) -**  NAC 445B.3453 – Application: general requirements. NAC 445B.3457 – Application: determination of completeness by

director. NAC 445B.346 – Required contents of permit. NAC 445B.3465 – Application for revision. NAC 445B.3473 – Renewal of permit. NAC 445B.3477 – Class II general permit.

**Class III Operating Permits (5) –**  NAC 445B.3485 – Application: general requirements. NAC 445B.3487 – Application: determination of completeness by

director. NAC 445B.3489 – Required content of permits. NAC 445B.3493 – Application for revision. NAC 445B.3497 – Renewal of permits.5 **RULES FOR WHICH RESCISSION IS REQUESTED** (7)

Two are recommended for approval, three are recommended for disapproval, and two are recommended for deferral.
Recommendations are shown in **CAPITALIZED, BOLD** type

.

Rule 25 of General Order No. 3 **DEFERRAL.** Article 1.60 – Effective date **DISAPPROVE.** Article 1.72 – Existing facility **DISAPPROVE.** Article 13.1.3(3) – Minor source BACT **APPROVAL.** NAC 445.706(2) – Appl. date: payment of fees **APPROVAL.** NAC 445.715 - Operation permits: revocation **DISAPPROVE.**
NRS 704.820 to 704.900 **DEFERRAL.**

**SUPERSEDED RULES**

If the recommendations above become final, then the following SIP rules will be superseded by the corresponding
rules listed in the second column.

**Existing SIP Submitted SIP**  NAC 445B.22083, approved at 69 FR 54006. NAC 445B.22083 Article 2.16.1, approved at 43 FR 36932. NAC 445B.250 NAC 445.682, approved at 49 FR 11626. NAC 445B.252

If the stationary source permitting program listed above that is recommended for disapproval were to be amended and then subsequently approved, the following additional rules would be superseded in the SIP.

**Definitions -**  Article 1.42 – Construction. Article 1.43 – Contiguous property. Article 1.104 – Major stationary source.
Article 1.109 – Modification.
Article 1.111 – Motor vehicle. Article 1.182 – Special mobile equipment. Article 1.187 - Stationary source. NAC 445.559 – Operating permit.

**Registration Certificates and Operating Permits** - NAC 445.704 Registration certificates and operating permits

required. NAC 445.705 Exemptions. NAC 445.706 Application date; payment of fees. NAC 445.707 Registration certificates: prerequisite;

application; fee; issuance, denial; expiration.6 NAC 445.712 Operating permits: prerequisite; application; fee; issuance, denial; posting. NAC 445.713 Operating permits: renewal. NAC 445.714 Operating permits: replacement of lost or damaged

permits. NAC 445.715 Operating permits: revocation. NAC 445.716 Operating permits: change of location.

**Point Sources -**  Article 13: 13.1 (“General Provisions for the Review of New Sources”): 13.1.1, 13.1.2, 13.1.3(1), 13.1.4, 13.1.5, 13.1.6, 13.1.7; 13.2 [applicability thresholds for environmental evaluations (EEs)]: 13.2.3, and 13.2.4; 13.3 [content requirements for EEs]: 13.3.1, 13.3.1.1,

13.3.1.2. 1

**II. BACKGROUND**

Outside of Clark and Washoe counties, the NDEP has primary responsibility to regulate air pollution from stationary and area sources in the State of Nevada. NDEP also has permitting responsibility on a State-wide basis for certain types of power plants. This technical support document (TSD) addresses the rules comprising the stationary source permitting program (excluding preconstruction review and permitting of new major sources or major modifications under parts C or D of the title I of the Clean Air Act) within the NDEP portion of the SIP.

Pursuant to the Clean Air Amendments of 1970, EPA promulgated national ambient air quality standards (NAAQS) for certain pervasive air pollutants, including particulate matter and sulfur dioxide. The Clean Air Act (CAA or “Act”), as amended in 1970, required each State to adopt and submit a plan which provides for implementation, maintenance, and enforcement of the NAAQS within such State. These plans are referred to as State implementation plans, or SIPs.

1 NDEP’s January 12, 2006 SIP submittal retains certain nonattainment NSR provisions including the definition of the term, “lowest achievable emission rate” (LAER), and NAQR article 13.1.3(2) in the SIP. Article 13.1.3(2) establishes the LAER requirement, and LAER is defined to apply to applicants who are required to submit EEs, and such applicants are identified by emissions-based threshold values in article 13.2, 13.2.1, and 13.2.2, submitted on July 24, 1979 and approved on June 23, 1982 (47 FR 27070). Thus, NAQR article 13.2, 13.2.1, and 13.2.2 must be retained in the SIP to properly interpret and apply NAQR article 13.1.3(2).7 The Governor of Nevada submitted the original Nevada SIP to EPA in January 1972. EPA approved certain portions of the original SIP and disapproved other portions under CAA section 110(a). See 37 FR 10842 (May 31, 1972). For some of the disapproved portions of the original SIP, EPA promulgated substitute provisions, referred to as Federal implementation plan (FIP) provisions, under CAA section 110(c). See, e.g., EPA’s final rule at 38 FR 7270 (February 25, 1974) in which EPA established provisions for review of new or modified indirect sources. This original SIP included various rules, codified as articles within the Nevada Air Quality Regulations (NAQR), and various statutory provisions codified in title 40, chapter 445 of the Nevada Revised Statutes (NRS). In the early 1980’s, the State of Nevada reorganized and re-codified its air quality rules as sections within chapter 445 of the Nevada Administrative Code (NAC). Today, the State of Nevada codifies its air quality regulations in chapter 445B of the NAC and codifies air quality statutes in chapter 445B of title 40 of the

NRS.

The State of Nevada adopted and submitted many revisions to the original set of regulations and statutes in the SIP, some of which EPA approved on February 6, 1975 at 40 FR 5511; on March 26, 1975 at 40 FR 13306; on January 9, 1978 at 43 FR 1341; on January 24, 1978 at 43 FR 3278; on August 21, 1978 at 43 FR 36932; on July 10, 1980 at 45 FR 46384; on April 14, 1981 at 46 FR 21758; on August 27, 1981 at 46 FR 43141; on March 8, 1982 at 47 FR 9833; on April 13, 1982 at 47 FR 15790; on June 18, 1982 at 47 FR 26386; on June 23, 1982 at 47 FR 27070; on March 27, 1984 at 49 FR 11626. Since 1984, EPA has approved very few revisions to Nevada’s SIP despite numerous changes that have been adopted locally. As a result, the version of the rules enforceable by NDEP is often quite different from the SIP version enforceable by EPA.

On February 16, 2005, NDEP submitted a large revision to the applicable Nevada SIP. The February 16, 2005 SIP submittal includes new and amended statutes and rules as well as requests for rescission of certain rules in the existing SIP. The February 16, 2005 SIP submittal also contains documentation of public participation (i.e., notice and public hearing) and adoption for all of the submitted rules through the hearing on November 30, 2004 held by the State Environmental Commission.

On January 12, 2006, NDEP submitted an amended version of the February 16, 2005 SIP submittal. The January 12, 2006 SIP submittal contains updated regulatory materials including new8 and amended rules adopted by the State Environmental Commission on October 4, 2005 but otherwise contains the same materials as the earlier submittal with the exception of the documentation of public participation. With respect to documentation of public participation, the January 12, 2006 SIP submittal includes documentation for rule amendments adopted by the State Environmental Commission on October 4, 2005 but does not include a re-submittal of the public participation documentation included in the earlier submittal. Therefore, the January 12, 2006 SIP submittal supersedes the earlier SIP revision submittal dated February 16, 2005 for all purposes except for the documentation of public participation for adoption dates from November 30, 2004 and earlier.

On December 8, 2006, NDEP submitted a supplemental SIP revision that includes two regulations adopted by the State Environmental Commission on September 6, 2006 and related public participation documentation. These regulations include R139-06 and R151-06. In R139-06, the commission repealed all of the provisions in the submitted rules that establish definitions or requirements related to designation of clean units and pollution control projects. The commission repealed these provisions in the wake of a decision by the D.C. Circuit Court of Appeals vacating those portions of EPA’s new source review rules that exempt clean units and pollution control projects from certain requirements that would otherwise apply as contrary to the Clean
Air Act

. See New York v. EPA , 413 F.3d 3 (D.C. Cir. 2005).

Specifically, in R139-06, the commission repealed the following rules that had been included in the January 12, 2006 SIP submittal: NAC 445B.041, 445B.136, 445B.33633, 445B.33635, 445B.33653; and amended the following rules also previously submitted: NAC 445B.295, 445B.308, 445B.310, 445B.3361,
445B.3363, 445B.3364, 445B.3365, 445B.33656, 445B.3366, 445B.3375, and 445B.3441. We consider these repealed or amended rules to supersede the versions of the corresponding rules submitted on January 12, 2006. 2

2 Some of the rules resubmitted by NDEP (as amended) on December 8, 2006 include subsections that NDEP had indicated in its January 12, 2006 that it was excluding from EPA review. We interpret NDEP’s December 8, 2006 submittal as superseding those specific subsections previously submitted for EPA action but not affecting the status of subsections previously excluded. In other words, if a given subsection of a rule was excluded from review in the January 12, 2006 SIP submittal, then we are not reviewing that rule subsection in this TSD notwithstanding the fact that it was submitted as part of the regulation adopted by the commission on September 6, 2006 and submitted to us on December 8, 2006.9 In regulation R151-06, also submitted on December 8, 2006, the commission amended certain submitted rules in response to EPA’s preliminary comments. These amended rules include NAC
445B.308, 445B.311, 445B.318, 445B.331, 445B.3363, 445B.3364, 445B.3395, 445B.3457, 445B.3485, 445B.3487, and 445B.3489. As with R139-06, we consider these amended rules to supersede the versions of the corresponding rules submitted on January 12, 2006. We note that three of the submitted rules, NAC 445B.308, 445B.3363, and 445B.3364 were amended by the State Environmental Commission in both R151-06 and R139-06, and because they reflect different revisions, NDEP must re-submit a single version of these rules that incorporates both sets of changes.

Our consideration of the rules submitted on January 12, 2006, as amended by the submittal dated December 8, 2006, and evaluated herein takes into account the public participation documentation contained in the February 16, 2005 (except, as noted, for the rules adopted on October 4, 2005 for which documentation was provided by NDEP in the January 12, 2006 SIP submittal and the rules adopted on September 6, 2006 for which documentation was provided by NDEP in the December 8, 2006 SIP submittal). CAA section 110(l) requires reasonable notice and public hearing prior to adoption of SIP revisions by States for subsequent submittal to EPA for approval or disapproval under CAA section 110(k)(3). 3 The public participation documentation provided by NDEP in the February 16, 2005 SIP submittal (and in the January 12, 2006 SIP submittal package for the October 4, 2005 rule amendments) for new or amended rules is sufficient for the purposes of CAA section 110(l). Generally, however, neither
the earlier nor the latter submittal included documentation of public notice and hearing for requested rescissions.

The primary purpose of the January 12, 2006 SIP revision is to clarify and harmonize current State rules and statutes with the federally enforceable rules and statutes in the Nevada SIP. Because this SIP revision incorporates so many changes from the 1970’s and 1980’s vintage SIP rules and statutes, EPA has decided to review and act on it in a series of separate rulemaking actions. The first such action (many definitions and certain sulfur emissions and burning rules) was proposed on September 13, 2005 (70 FR 53975) and finalized on March 27, 2006 (71 FR 15040). The second related action (air pollution statutes) was proposed on June 9, 2006 (71 FR 33413) and finalized on August 31, 2006 (71 FR 51766). The third related

3 CAA section 110(l) states: “Each revision to an implementation plan submitted by a State under this chapter shall be adopted by such State after reasonable notice and public hearing. ... .”10 action (most of the State-requested SIP rescissions) was proposed on August 28, 2006 (71 FR 50875) and finalized (for most of the rescissions) on January 3, 2007 (72 FR 11). The fourth related action (monitoring and VOC rules) was proposed on August 31, 2006 (71 FR 51793) and finalized on December 11, 2006
(71 FR 71486).

The rulemaking for which this TSD has been prepared addresses the set of rules contained in NDEP’s January 12, 2006 SIP revision submittal that establish permitting requirements for stationary sources under NDEP’s jurisdiction (excluding such requirements for new major sources or major modifications under parts C or D of title I of the CAA). For the reasons set forth below, this TSD recommends approval of three individual rules that we find to be separable from the rest of the program, disapproval of four individual, separable rules, disapproval of the set of 87 rules that comprise the bulk of the program,approval of two of the State’s seven rescissions of permitrelated rules in the existing SIP, disapproval of three of the rescissions, and deferral of two of the rescissions.

**III. EPA EVALUATION CRITERIA**

EPA reviewed the submitted rules establishing the requirements for NDEP’s stationary source permitting program for compliance with the CAA requirements for SIPs in general set forth in CAA section 110(a)(2) and 40 CFR part 51, subpart I (“Review of New Sources and Modifications”), particularly section 51.160 (“Legally enforceable procedures”), 51.161 (“Public availability of information”), 51.162 (“Identification of responsible agency”), 51.163 (“Administrative procedures”), and 51.164 (“Stack height procedures”) and also for compliance with CAA requirements for SIP revisions in CAA section 110(l)

and 193.

**IV. DISCUSSION OF SUBMITTED RULES**

In this section of the TSD, we provide a rule-by-rule discussion of the submitted rules and any corresponding rules in the existing SIP and identify any issues (including deficiencies) in the submitted rules or any significant differences between submitted rules and existing SIP rules. Unless otherwise noted, the submitted rules are based on the January 2005 Legislative Counsel Bureau codification of NAC chapter 445B.11 Where individual rules are separable from the rest of the permitting program, we provide a rule-specific recommendation for action. Most of the rules that comprise the permitting program are not separable and a recommendation for them as a whole is provided in section V (of this TSD). Following the evaluation of the permitting program in section V, we provide our evaluation of the NDEP’s request (in their January 12, 2006 SIP revision) for rescission of certain permit-related rules in the SIP (see section VI of this TSD).

**Definitions (46) –** 

NAC 445B.003 – “Adjacent properties” defined. This definition

would be new to the Nevada SIP, and it clarifies the meaning of the phrase “contiguous or adjacent properties” as used in the definition of stationary source in NAC 445B.187.

NAC 445B.0035 – “Administrative revision to a Class I operating

permit” defined . This definition would be new to the Nevada SIP, and it refers to a revision of a Class I operating permit to incorporate relevant conditions of an operating permit to

construct.

NAC 445B.007 – “Affected state” defined. This definition would

be new to the Nevada SIP, and it is used in connection with notification requirements for draft permits. This term is defined essentially the same as the term is defined in 40 CFR 70.2 in connection with title V programs.

NAC 445B.013 – “Allowable emissions” defined , as amended in section 7 of Regulation R096-05, adopted by the State Environmental Commission on October 4, 2005. This definition would be new to the Nevada SIP, and it means the emissions from a stationary source at its designed or actual maximum capacity, whichever is greater, except as reduced by any federally
enforceable limitations on its emissions which are established by State laws or regulations, any applicable requirement, or by conditions of the stationary source’s operating permit, whichever is most stringent.

NAC 445B.014 – “Alteration” defined . This definition would be

new to the Nevada SIP, and it refers to any addition to, or enlargement, replacement, modification or change of the design, capacity, process, arrangement, operating hours or control apparatus that will affect the kind or amount of regulated air pollutants emitted.12 NAC 445B.016 – “Alternative operating scenarios” defined. This

definition would be new to the Nevada SIP, and it refers to two or more modes or types of operation specifically identified by a stationary source in its application and approved by NDEP as a condition of the source’s operating permit.

NAC 445B.019 – “Applicable requirement” defined. This definition

would be new to the Nevada SIP, and it refers to, among other requirements, emissions limitations and work practices required under State law, the SIP, 40 CFR parts 60, 61, or 63, title IV or VI of the Act, and pre-construction permit conditions under
title I of the Act. This definition is based on the definition
of the same term in 40 CFR 70.2.

NAC 445B.021 – “Area source” defined. This definition would be

new to the Nevada SIP, and it means any stationary source of hazardous air pollutants that is not a major source. This defined term is not relied upon by any of the rules submitted to EPA for approval or by any of the rules in the existing SIP, and thus should be disapproved. The disapproval of this definition is separable from the actions on the rest of the January 12, 2006 and December 8, 2006 SIP revision submittals.

**RECOMMENDATION: SEPARABLE – FULL DISAPPROVAL.**

NAC 445B.028 – “Best available control technology” defined. This

definition would be new to the Nevada SIP, 4 and it defines best available control technology (BACT) for sources that are subject to 40 CFR 52.21 by referencing the definition of BACT in 40 CFR 52.21, as adopted in NAC 445B.221. 5 This defined term

4 More precisely, a State definition of BACT would be new to the SIP. The Federal definition of BACT, and other terms used in connection with the prevention of significant deterioration (PSD) pre-construction review program, are currently part of the Nevada SIP pursuant to 40 CFR 52.1485(b).

5 NAC 445B.221 – Adoption by reference of provisions of federal law and regulations . NAC 445B.221 adopts by reference a number of federal laws and regulations as they existed on certain specified dates. NAC 445B.221 is cited in the following submitted rules (but was not itself submitted for approval into the SIP):

• NAC 445B.028 - “Best available control technology” defined.

• NAC 445B.087 - “Increment” defined.

• NAC 445B.094 - “Major source” defined.

• NAC 445B.187 - “Stationary source” defined.

• NAC 445B.22083 - Construction, major modification or relocation of plants to generate electricity using steam produce by burning of fossil

fuels.

• NAC 445B.308 - Prerequisites and conditions for issuance of operating permits: environmental evaluation; compliance with control strategy; exemption from environmental evaluation.

• NAC 445B.310 - Environmental evaluation: applicable sources.13 is not relied upon by any of the rules submitted to EPA for approval. BACT is a term used in existing SIP rule, NAQR article 13.1.3(3), but we are proposing in this action to approve NDEP’s request for rescission of NAQR article 13.1.3(3), and thus a definition for BACT is not necessary. Thus, submitted rule NAC 445B.028 should be disapproved. The disapproval of this submitted rule is separable from the actions on the rest of the January 12, 2006 and December 8,
2006 SIP revision submittals. **RECOMMENDATION: SEPARABLE – FULL**

**DISAPPROVAL.**

NAC 445B.035 – “Class I-B application” defined. This definition

would be new to the Nevada SIP, and it refers to applications for any new stationary source or “significant modification” to an existing stationary source which is subject to the operating permit program requirements under title V of the Clean Air Act.

NAC 445B.036 – “Class I source” defined. This definition would

be new to the Nevada SIP, and it refers to title V sources, sources for which major modifications have been proposed, and major stationary sources. Because a source must be a major stationary source to propose to construct a “major modification,” the second category of sources is subsumed in the third category. Instead, we recommend that this definition

• NAC 445B.311 - Environmental evaluation: required information.

• NAC 445B.318 - Operating permits: separate permit required for each source; form of application; issuance or denial of permit; posting of permit.

• NAC 445B.3363 - Operating permit to construct: application.

• NAC 445B.33656 - Operating permit to construct for approval of plantwide applicability limitation: required conditions and
information.

• NAC 445B.3368 - Application: additional requirements; exception

.

• NAC 445B.3395 – Review of application and determination of completeness by director; notice; expiration of permit.

• NAC 445B.344 - Significant revision of permit

.

Normally, in this context, we would identify the failure to submit a rule relied upon by another rule that has been submitted for approval into the SIP as a deficiency in the submittal. However, we find NDEP’s decision not to submit NAC 445B.221 in this instance to be acceptable. We believe that it is NDEP’s clear intention to update the SIP rules that rely on Federal law and regulations (as adopted in NAC 445B.221) automatically upon action by the State Environmental Commission to update NAC 445B.221 (e.g., with more recent dates) from time-to-time in response to changes made by Federal entities to the laws and regulations so adopted. As such, we believe that interpretation of the related SIP rules would not be ambiguous even though they cite a rule
not included in the SIP.14 be amended to clarify that the term “class I” source includes any physical change that would occur at a non-major source if the change would constitute a “major stationary source” by itself. See 40 CFR 51.166(b)(1)(i)( c ).

NAC 445B.037 – “Class II source” defined. This definition would

be new to the Nevada SIP, and it refers to sources that are subject to the State’s air pollution regulations but is neither

a Class I source nor a Class III source.

NAC 445B.038 – “Class III source” defined. This definition would

be new to the Nevada SIP, and it refers to sources that emit or have the potential to emit, individually or in combination, a total of not more than 5 tons per year of PM 10 , NO x , SO 2 , VOC and

H 2 S and less than 1,000 pounds per year of lead; that are not subject to title V of the Clean Air Act or 40 CFR parts 60 or 61; that are not temporary sources nor located at or part of another stationary source, and whose owner or operator is not seeking a limitation on emissions to avoid 40 CFR part 63 or is not required to obtain an operating permit to operate solely to comply with NAC 45B.22037 relating to surface area
disturbances. NAC 445B.038 denies class III status to sources that are subject to 40 CFR parts 60 or 61; this definition should be revised to deny class III status to sources that are subject to 40 CFR part 63 as well.

NAC 445B.044 – “Construction” defined , as amended in section 8 of Regulation R096-05, adopted by the State Environmental Commission on October 4, 2005. Existing SIP rule: NAQR article 1.42 – Construction, submitted on December 10, 1976, and approved on August 21, 1978 (43 FR 36932). This submitted definition is more inclusive than the corresponding provision in the existing SIP and is essentially the same as EPA’s definition of “construction” in 40 CFR 51.166(b)(8).

NAC 445B.046 – “Contiguous property” defined. Existing SIP rule:

Article 1.43 – Contiguous property, submitted on December 10, 1976, and approved on August 21, 1978 (43 FR 36932). This submitted definition essentially repeats the corresponding provision in the existing SIP.

Sec. 2 of Regulation R096-05 – “Dispersion technique” defined,

adopted by the State Environmental Commission on October 4, 2005. This definition would be new to the Nevada SIP, and it mirrors EPA’s definition of “dispersion technique” in 40 CFR 51.100(hh).15 Sec. 3 of Regulation R096-05 – “Excessive concentration”

defined, adopted by the State Environmental Commission on October 4, 2005

. This definition would be new to the Nevada SIP, and it mirrors EPA’s definition of “excessive concentration” in 40 CFR 51.100(kk).

NAC 445B.066 – “Existing stationary source” defined. This

definition would be new to the Nevada SIP, and it means, for sources subject to CAA section 112, any source other than a new source, and for all other types of sources, it means a stationary source which was constructed, or for which the owner or operator submitted a complete application for an operating permit, before the “effective date of the program,” which is
defined in submitted rule NAC 445B.055. NAC 445B.055 was approved by EPA in the SIP on March 27, 2006 (71 FR 15040).

NAC 445B.068 – “Facility” defined. This definition would be new to the Nevada SIP. It includes any groups of activities which emit regulated air pollutants, are located on one or more contiguous properties, and are owned, operated or controlled by the same person.

NAC 445B.069 – “Federally enforceable” defined. This definition would be new to the Nevada SIP, and it means enforceable by EPA pursuant to the CAA, EPA’s PSD regulations, or by citizens
under CAA section 304. NAC 445B.069 also refers to EPA enforcement under 40 CFR 51.160 to 51.166, inclusive, or 40 CFR part 70. Code of Federal Regulations, title 40, part 51, sections 160 to 166 (40 CFR 51.160 to 51.166) contains EPA requirements for SIPs with respect to stationary source permitting programs, and is not a source of enforcement authority for EPA. Similarly, 40 CFR part 70 refers to EPA requirements for States in establishing operating permit rules
for “title V” sources and is not a source of enforcement authority for EPA.

EPA’s definition of the same term is as follows: “Federally
enforceable” means all limitations and conditions which are enforceable by the Administrator, including those requirements developed pursuant to 40 CFR parts 60 and 61, 6 requirements within any applicable State implementation plan, any permit requirements established pursuant to 40 CFR 52.21 or under regulations approved pursuant to 40 CFR part 51, subpart I,

6 Notwithstanding the current EPA definition of this term, requirements developed pursuant to 40 CFR part 63, in addition to requirements developed pursuant to 40 CFR parts 60 and 61, should be listed among the requirements which are enforceable by EPA.16 including operating permits issued under an EPA-approved program that is incorporated into the State implementation plan and expressly requires adherence to any permit issued under such program.” See 40 CFR 51.166(b)(17). NAC 445B.069 must be revised to more closely match EPA’s definition.

NAC 445B.070 – “Federally enforceable emissions cap” defined.

This definition would be new to the Nevada SIP, and it means a condition of an operating permit containing an emission limitation that the holder of the operating permit requested and NDEP approved and which is independent of any applicable requirement or requirements.

NAC 445B.082 – “General permit” defined. This definition would

be new to the Nevada SIP. It refers to an operating permit that covers numerous similar stationary sources.

Sec. 4 of Regulation R096-05 – “Good engineering practice stack

height” defined, adopted by the State Environmental Commission on October 4, 2005

. This definition would be new to the Nevada SIP, and it largely mirrors EPA’s definition of “good engineering practice (GEP)” stack height in 40 CFR 51.100(ii). However, the State’s definition differs from EPA’s definition by replacing the phrase “stacks in existence before January 12, 1979” with the phrase “stacks that commenced construction on or before January 12, 1979.” While we do not find this difference to be significant, we recommend that NDEP fix this minor deficiency when the rule is next amended.

NAC 445B.087 – “Increment” defined. This definition would be new to the Nevada SIP, and it defines “increment” by reference to EPA’s prevention of significant deterioration (PSD) rule at 40 CFR 52.21, as adopted in NAC 445B.221.

NAC 445B.093 – “Major modification” defined. This definition

would be new to the Nevada SIP, and it defines “major modification” by reference to EPA’s prevention of significant deterioration (PSD) rule at 40 CFR 52.21. In this instance, and unlike most of the adopted definitions that rely on 40 CFR 52.21, NAC 445B.093 refers only to 40 CFR 52.21 and does not specify 40 CFR 52.21 as incorporated by reference in NAC

445B.221 . We recommend that the State Environmental Commission amend this definition accordingly unless there is some reason not to specify the incorporation by reference in NAC 445B.221 in this particular definition.17 NAC 445B.094 – “Major source” defined . This definition would be

new to the Nevada SIP, and it defines “major source” similarly
to EPA’s definition of the same term in 40 CFR 70.2.

NAC 445B.0945 – “Major stationary source” defined. Existing SIP rule: Article 1.104 – Major stationary source, submitted on December 10, 1976 and approved on August 21, 1978 (43 FR 36932). This submitted definition would change the definition of “major stationary source” to refer to EPA’s definition of “major stationary source” in the prevention of significant deterioration (PSD) rule at 40 CFR 52.21(b)(1). In this instance, and unlike most of the adopted definitions that rely on 40 CFR 52.21, NAC 445B.0945 refers only to 40 CFR 52.21 and does not specify 40 CFR 52.21 as incorporated by reference in

NAC 445B.221 . We recommend that the State Environmental Commission amend this definition accordingly unless there is some reason not to specify the incorporation by reference in NAC 445B.221 in this particular definition.

NAC 445B.099 – “Modification” defined. Existing SIP rule: Existing SIP rule: Article 1.109 – Modification, submitted on December 10, 1976 and approved on August 21, 1978 (43 FR 36932). This submitted definition is essentially unchanged relative to the corresponding existing SIP provision, which defines “modification” as any physical change in, or change in the method of operation of, a stationary source which increases the amount of any air pollutant or result in the emission of any air pollutant not previously emitted.

NAC 445B.104 – “Motor vehicle” defined. Existing SIP rule:

Article 1.111 – Motor vehicle, submitted on December 10, 1976, and approved on August 21, 1978 (43 FR 36932). This submitted definition refers to a category of sources that are excluded from the definition of “stationary source” in NAC 445B.187. In doing so, the submitted provision relies on the definition of “motor vehicle” in NRS 485.050. Much like the existing SIP rule, NRS 485.050 defines “motor vehicle” to include every self-propelled vehicle which is designed for use upon a highway. However, NRS 485.050 was not submitted for approval
into the SIP. NAC 445B.104 must be amended to eliminate the hanging reference or NRS 485.050 must be submitted and thereby avoid potential confusion in interpreting the term “stationary
source” in NAC 445B.187.

Sec. 5 of Regulation R096-05 – “Nearby” defined , adopted by the

State Environmental Commission on October 4, 2005

. This18 definition would be new to the Nevada SIP, and it mirrors EPA’s definition of “nearby” in 40 CFR 51.100(jj).

NAC 445B.108 – “New stationary source” defined. This definition

would be new to the Nevada SIP and it defines “new stationary
source” in the CAA section 112 context in a manner consistent with EPA’s definition of “new source” in 40 CFR 61.02, and defines “new stationary source” in all other contexts as all sources for which an owner or operator has not submitted a complete application for an operating permit before the “effective date of the program.” See discussion of NAC 445B.066, above.

NAC 445B.117 – “Offset” defined. This definition would be new to the Nevada SIP, and it refers to a reduction in emissions at an existing stationary source which is greater than a corresponding increase in emissions of the same regulated air pollutant at a new or modified stationary source in the same
nonattainment area.

NAC 445B.123 – “Operating permit” defined. Existing SIP rule:

NAC 445.559 – Operating permit, submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted definition relies on the definition of “operating permit” in NRS 445B.145, which was approved as a revision to the Nevada SIP on August 31, 2006 (71 FR 51766). The definition of “operating permit” in NRS 445B.145 is essentially the same as that in existing SIP rule NAC 445.559.

NAC 445B.124 – “Operating permit to construct” defined. This

definition would be new to the Nevada SIP, and it refers to an operating permit signed and issued by NDEP which authorizes the construction and initial period of operation of a proposed new Class I stationary source or modification to an existing Class I stationary source, includes the conditions which apply to the construction and the initial period of operation of the new or modified source, and requires the holder of the operating permit to construct to submit a complete application for a Class I operating permit or modification of an existing Class I operating permit within 12 months after the date of the initial start-up of the new or modified Class I source.

NAC 445B.1345 – “Plantwide applicability limitation” defined.

This definition would be new to the Nevada SIP, and it refers to a “plantwide applicability limitation” (PAL) as defined in EPA’s PSD regulation at 40 CFR 52.21(aa)(2)(v) that has been approved by NDEP and authorized in an operating permit to19 construct. In this instance, and unlike most of the adopted definitions that rely on 40 CFR 52.21, NAC 445B.1345 refers only to 40 CFR 52.21 and does not specify 40 CFR 52.21 as incorporated by reference in NAC 445B.221 . We recommend that
the State Environmental Commission amend this definition accordingly unless there is some reason not to specify the incorporation by reference in NAC 445B.221 in this particular
definition.

NAC 445B.138 – “Potential to emit” defined. This definition

would be new to the Nevada SIP, and it essentially tracks EPA’s definition of “potential to emit” (PTE) in 40 CFR 51.166(b)(4) with the exception that NAC 445B.138 allows an emission limitation to be treated as part of a source’s design for the purposes of calculating PTE if the limitation is “enforceable by the director,” as opposed to “federally enforceable.” In the wake of legal challenges to aspects of EPA’s NSR regulations [see National Mining Association v. EPA , 59 F.3d 1351 (D.C. Cir. 1995) and Chemical Manufacturers Ass’n v. EPA , No. 89- 1514(D.C. Cir. Sept. 15, 1995)], EPA interprets the term “federally enforceable” in the NSR context to mean “federally enforceable or legally and practicably enforceable by a state or local air pollution control agency.” See Memorandum from John S. Seitz, Director, EPA Office of Air Quality Planning and Standards, entitled “Release of Interim Policy on Federal Enforceability of Limitations on Potential to Emit,” dated January 22, 1996.

In light of the court cases and EPA’s interim policy, the State’s definition of PTE need not require that the given limit be “federally enforceable” but must be amended to require
effective limits and to include criteria under which a limit will be deemed to be practicably enforceable by NDEP. Such
criteria could include:

• a requirement for the source to maintain emissions below a threshold or significance level that identifies each emission unit(s) contribution to the limit and any restrictions, control devices, or control measures employed;

• the compliance determination period (e.g., hourly, daily, monthly, but not exceeding a 12-month rolling total calculated monthly depending on the compliance method used);

• the method for quantifying emissions and determining compliance with the PTE limit; and20 • procedures and criteria for routine verification of monitoring data and of compliance, including recordkeeping, reporting, and testing in agreement with the method for quantifying emissions and determining compliance with the
PTE limit.

NAC 445B.142 – “Prevention of significant deterioration of air quality” defined. This definition would be new to the Nevada SIP, and it refers to the meaning ascribed to this same term in EPA’s PSD regulation (i.e., 40 CFR 52.21). In this instance, and unlike most of the adopted definitions that rely on 40 CFR 52.21, NAC 445B.142 refers only to 40 CFR 52.21 and does not specify 40 CFR 52.21 as incorporated by reference in NAC

445B.221 . We recommend that the State Environmental Commission amend this definition accordingly unless there is some reason not to specify the incorporation by reference in NAC 445B.221 in this particular definition.

NAC 445B.147 – “Program” defined. This definition would be new to the Nevada SIP, and it refers to the program for issuing operating permits to class I sources that EPA has approved as complying with the requirements of 40 CFR part 70 (implementing title V of the CAA). EPA granted interim approval of NDEP’s title V operating permit program effective January 11, 1996 (60 FR 63631, December 12, 1995) and then full approval of the amended program effective November 30, 2001 (66 FR 63188, December 5, 2001). The term “program” is relied upon in the definition of the term “effective date of the program,” as defined in NAC 445B.055, which was approved as a revision to the Nevada SIP on March 27, 2006 (71 FR 15040).

NAC 445B.154 – “Renewal of an operating permit” defined. This

definition would be new to the Nevada SIP, and it refers to the process by which a holder of an operating permit applies for and NDEP reissues the operating permit at the end of its term.

NAC 445B.156 – “Responsible official” defined. This definition

would be new to the Nevada SIP, and it largely tracks EPA’s definition of “responsible official” in 40 CFR 70.2.

NAC 445B.157 – “Revision of an operating permit” defined. This

definition would be new to the Nevada SIP, and it refers to any modification of, or any administrative amendment or administrative revision to, an operating permit.

NAC 445B.178 – “Source reduction” defined. This definition would

be new to the Nevada SIP, and it defines “source reduction”21 consistently with EPA’s definition of the same term in 40 CFR 63.2. EPA’s definition was developed in connection with rules establishing Maximum Achievable Control Technology (MACT) standards for control of hazardous air pollutants from specific source categories. This defined term is not relied upon by any of the rules submitted to EPA for approval or by any of the rules in the existing SIP, and thus should be disapproved. The disapproval of this definition is separable from the actions on the rest of the January 12, 2006 and December 8, 2006 SIP
revision submittals. **RECOMMENDATION: SEPARABLE – FULL**

**DISAPPROVAL.**

NAC 445B.179 – “Special mobile equipment” defined. Existing SIP rule: Article 1.182 – Special mobile equipment, submitted on December 10, 1976, and approved on August 21, 1978 (43 FR 36932). This submitted definition refers to a category of sources that are excluded from the definition of “stationary source” in NAC 445B.187. In doing so, the submitted provision relies on the definition of “special mobile equipment” in NRS 482.123. Much like the existing SIP definition, NRS 482.123 defines “special mobile equipment” to mean every vehicle not designed or used primarily for the transportation of persons or property upon a highway. However, NRS 482.123 was not submitted for approval into the SIP. NDEP must submit NRS 482.123 for approval into the SIP.

NAC 445B.187 – “Stationary source” defined. Existing SIP rule:

Article 1.187 – Stationary source, submitted on December 10, 1976, and approved on August 21, 1978 (43 FR 36932). This submitted provision defines “stationary source” differently than the existing SIP but the new definition is generally consistent with EPA’s definitions of “stationary source” and “building, structure, facility, or installation” in 40 CFR 51.166(b)(5) and (6), respectively. As defined in NAC 445B.187, the term “stationary source” excludes motor vehicles, special mobile equipment, nonroad engines and nonroad vehicles.

The 1990 Amendments to the Clean Air Act added a new definition of “stationary source” in section 302(z). As defined in CAA section 302(z), “stationary source” means generally any source of an air pollutant except those emissions resulting directly from an internal combustion engine for transportation purposes or from a nonroad engine or nonroad vehicle. We believe that the addition of section 302(z) in the 1990 Amendments appears to strengthen congressional intent that certain internal combustion engines be subject to control under State permit programs, while requiring the exclusion of those internal22 combustion engines which are “nonroad,” a category of engines and vehicles which was also newly defined in the 1990 Amendments. See EPA’s General Preamble for the Implementation of Title I of the Clean Air Act Amendments of 1990, 57 FR 13498, at 13555 (April 16, 1992).

As noted above, NAC 445B.187 excludes “special mobile equipment” as well as “nonroad engines” and “nonroad vehicles” from the stationary source permitting program. Presumably, “special mobile equipment” is not entirely comprised of nonroad engines or vehicles because otherwise there would be no need to include “special mobile equipment” in the list. Thus, “special mobile equipment” (as set forth in NRS 482.123 and incorporated into NAC 445B.179) may include engines that are used in stationary applications and must therefore be included in NDEP’s stationary source permitting program to comply with CAA section 302(z). The State Environmental Commission must amend NAC 445B.179 accordingly or NDEP must explain how the submitted definition complies with CAA section 302(z) notwithstanding the exclusion of internal combustion engines that do not fall within the nonroad engine or nonroad vehicle categories.

NAC 445B.194 – “Temporary source” defined. This definition would

be new to the Nevada SIP and it refers to any building, structure, facility, or installation which emits or may emit any regulated air pollutant, may be moved from one location to another, is located or operated in a location for a period of
less than 12 months; and is not an “affected source.”

NAC 445B.196 – “Toxic regulated air pollutant” defined. This

definition would be new to the Nevada SIP, and it refers to any substance designated as such by the State Environmental Commission. This term is not relied upon by any of the rules submitted to EPA for approval or by any of the rules in the existing SIP, and thus should be disapproved. The disapproval of this submitted rule is separable from the actions on the rest of the January 12, 2006 and December 8, 2006 SIP revision
submittals. **RECOMMENDATION: SEPARABLE – FULL DISAPPROVAL**

.

**General Provisions (3) –**  NAC 445B.22083 – Construction, major modification or relocation of plants to generate electricity using steam produced by burning of fossil fuels , as amended in section 14 of Regulation R096-05, adopted by the State Environmental Commission on October 4, 2005

. Existing SIP rule: 445B.22083, submitted on November 30, 2003, and approved on September 7, 2004 (69 FR 54006). This submitted rule would supersede an earlier version23 approved into the Nevada SIP as part of EPA’s action in September 2004 on the amended Clark County NSR rules and amends a deficiency in that earlier version that could have been interpreted to allow relocation of certain power generating units to Ivanpah Valley without undergoing new source review. Thus, the submitted rule is an improvement over the existing
SIP version. **RECOMMENDATION: SEPARABLE - APPROVE**

.

NAC 445B.250 - Notification of planned construction or

reconstruction , as amended in section 18 of Regulation R096-05, adopted by the State Environmental Commission on October 4, 2005. Existing SIP rule: Article 2.16.1, submitted on December 10, 1976, and approved on August 21, 1978 (43 FR 36932). This submitted rule is essentially the same as existing SIP rule, NAQR article 2.16.1, subsections 2.16.1.1, 2.16.1.2, 2.16.1.3,
and 2.16.1.5. The submitted rule has no subsection that in substance substitutes for 2.16.1.4, which requires owners or operators to provide notice to NDEP of the date of any physical or operational change to an existing facility which may increase the emission rate unless that change is specifically exempted under the applicable regulation or in article 2.14, which was never SIP-approved. However, we find that the notice requirement for modifications as set forth in NAQR article 2.16.1.4 need not be brought forward in NAC 445B.250 because modification by mere notification is not allowed except for administrative amendments (NAC 445B.319) but rather requires an owner or operator to obtain a revision to the operating permit
to commence construction of the modification. **RECOMMENDATION:**

**SEPARABLE - APPROVE.**

NAC 445B.252 - Testing and sampling , excluding paragraphs (b) and (c) of subsection (2) and excluding subsection (6)

. Existing SIP rule: NAC 445.682, submitted on October 26, 1982, and approved on March 27, 1984 (49 FR 11626). This submitted rule authorizes NDEP to conduct or order the testing and sampling of emissions from new or modified sources and establishes certain requirements for such testing and sampling. The submitted rule largely mirrors the existing SIP rule except that it no longer allows for NDEP to approve equivalent or
alternative test methods. The deletion of NDEP’s discretion in this context represents a strengthening of the rule. The submitted rule contains the following editing error: the phrase “method of reference” is used in NAC 445B.252(2)(a) when “reference method” is intended. See NAC 445B.152 (“Reference method” defined). This minor error should be corrected by the
State Environmental Commission when the rule is next amended.

**RECOMMENDATION: SEPARABLE - APPROVE.** 24 **Operating Permits Generally (18) -**  NAC 445B.287 – Operating permits: general requirements;

exception; restriction on transfers , excluding subsection (2). Existing SIP rule: NAC 445.704, submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule sets forth the general requirement for stationary sources to obtain an operating permit, operating permit to construct, or permit to construct and cites the rules that apply to permit requirements for source modifications. This rule also limits transferability of permits. Like the existing SIP, the submitted rule exempts certain sources from the general permitting requirement, but NAC 445B.287 also exempts certain other sources (referred to in “subsection 2,” a portion of the rule that was not included in the submittal) from permit revision requirements. NDEP must submit “subsection 2” for EPA review and approval as part of the SIP revision or amend the rule to eliminate the related exemption. We also note that the submitted rule does not include an equivalent provision to subsection (2) from the existing SIP rule that states: “Registration certificates and operating permits for single sources may be issued through an approved local air pollution control program.” However, we find that elimination of that particular subsection from the SIP would be inconsequential because the SIP otherwise provides for such local permitting programs [e.g., see NRS 445B.500, which we approved on August 31, 2006 (71 FR 51766)].

NAC 445B.288 – Operating permits: exemptions from requirements; insignificant activities . Existing SIP rule: NAC 445.705, submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). The existing SIP rule lists nine categories of “single sources” as exempt from registration and operatingpermit requirements: (1) air-conditioning equipment or fuelburning equipment having a rating of less then 4 MMBtu/hour; (2) motor vehicles, special mobile equipment and internal combustion engines; (3) residential and commercial housekeeping vacuum systems; (4) incinerators with less than 25 lb/hour rated burning capacity; (5) agricultural land use; (6) storage containers for gasoline, petroleum distillate or other VOC having a capacity of less than 40,000 gallons; (7) equipment or contrivances used exclusively for the processing of food for human consumption; (8) disturbing topsoil of less than 20 acres; and (9) process weight rates of less than 50 lb/hour.

This submitted rule lists the following categories of sources that are exempt from the requirement to obtain an operating25 permit: sources that would otherwise be required to obtain an operating permit solely because they are subject to either 40 CFR part 60, subpart AAA or part 61, subpart M, and agricultural equipment used in the normal operation of a farm, other than agricultural equipment that is classified as, or located at, a source for which a permit is required under title V of the Act or which is subject to any standard set forth in 40 CFR part 60 or 61. This rule should be amended to exclude from exemption agricultural equipment which is subject to any standard set forth in 40 CFR part 63 as well.

The submitted rule also establishes eight categories of emission units (akin to the former term “single source”) as “insignificant activities,” including five of the categories of “single sources” exempt under the existing SIP rule (specifically, categories #1, #4, #6, #7, and #9, above). As explained in more detail below, “insignificant activities” are not required to obtain an operating permit.

The exemption in the existing SIP rule for motor vehicles and special mobile equipment (see #2, above) is now intrinsic to the term “stationary source” as defined in submitted NAC 445B.187, and the exemption for internal combustion engines has been newly limited to smaller engines and low-use engines. The exemptions for residential and commercial housekeeping vacuum systems, agricultural land use, and surface area disturbances of less than 20 acres (see #3, #5 and #8, above) have not been carried forward in the submitted rule, but, with respect to the latter two (agricultural land use and surface area disturbances), operating permits or exemptions therefrom are provided for in NAC 445B.22037 (“Emissions of particulate matter: fugitive dust”), which has been submitted for approval as part of the January 12, 2006 SIP revision.

The submitted rule also establishes “emergency generator” as an insignificant activity. Emergency generators qualify for status as an insignificant activity only if the generator is used to generate electrical power to maintain essential operations during unplanned electrical power outages. Such limited use ensures that emergency generators generate de minimis emissions impacts. NAC 445B.288 disqualifies (as an insignificant activity) emergency generators owned or operated by a class II source and whose potential to emit is calculated on the basis of less than 500 hours of operation. We can think of no rationale explanation for restricting this limitation to class

II sources and recommend that the rule be amended to extend26 this limitation to emergency generators at class I sources as

well.

Under the submitted rule, “insignificant activities” are not required to obtain an operating permit but must be included in any determination of whether a stationary source is a major source. The submitted rule also provides for NDEP to approve any emission unit as an insignificant activity if the emission unit is not otherwise subject to a specific applicable requirement and whose potential to emit is less than 2 tons per year and meets other listed criteria.

NAC 445B.295 – Application: General requirements , as amended in section 1 of Regulation R139-06, adopted by the State Environmental Commission on September 6, 2006

. This rule would be new to the Nevada SIP, and it sets forth the general content requirements for applications for operating permits, except as otherwise provided in the rules related to applications for plantwide applicability limitations. Required types of information for applications include information to identify the applicant, a description of the processes and products, a description of the fuels to be used, a description of any control air pollution control equipment to be installed, etc.

NAC 445B.297 – Application: submission of application and supplementary or corrected information , excluding subsection
(2)

. This rule would be new to the Nevada SIP, and it provides that applicants must use appropriate forms provided by NDEP and provides for certification of the application by a responsible official of the stationary source.

NAC 445B.298 – Application: official date of submittal. Existing SIP rule: NAC 445.706(1), submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule appropriately changes the official date of all applications for stationary source permits from the U.S. registered or certified postmark date (in the existing SIP rule) to the date on which NDEP determines that the application is complete.

NAC 445B.305 – Operating permits: imposition of more stringent
standards for emissions. This rule would be new to the Nevada SIP, and it provides NDEP with authority to impose standards for emissions on a proposed stationary source that are more stringent than those found in the State’s air pollution rules as a condition of approving an operating permit for the proposed stationary source.27 NAC 445B.308 – Prerequisites and conditions for issuance of operating permits: environmental evaluation; compliance with control strategy; exemption from environmental evaluation , as amended in section 3 of Regulation R139-06 and as amended in section 9 of Regulation R151-06, both of which were adopted by the State Environmental Commission on September 6, 2006, but excluding paragraph (d) of subsection (2) and excluding subsections (4), (5), and (10)

. Existing SIP rules: NAQR article 13.1.1, submitted on July 24, 1979 and approved on June 23, 1982 (47 FR 27070); NAQR article 13.1.3.1, submitted on March 17, 1980 and approved on April 14, 1981 (46 FR 21758); and NAQR article 13.1.4, 13.1.5, and 13.1.6, submitted on April 1, 1974 and approved on March 26, 1975 (40 FR 13306). First of all, we note that NDEP has submitted two different versions of NAC 445B.308. One version reflects changes adopted in Regulation R139-06, and the other reflects changes adopted in Regulation R151-06. NDEP must re-submit a single version of the rule or withdraw one of the two versions to avoid unnecessary
confusion.

These submitted rules require applicants to submit environmental evaluations (EE) in accordance with the related EE content requirements contained in NAC 445B.308 to 445B.314, inclusive, for a new or modified stationary source, for a PAL, or to allow a PAL to expire and not be renewed. These rules provide that NDEP shall not issue an operating permit or a revision of an operating permit if the EE shows that the stationary source will prevent the attainment and maintenance of the state or national ambient air quality standards as set forth in NAC 445B.22097, will cause a violation of the applicable control strategy contained in the approved air quality plan, will cause a violation of any applicable requirement.

The submitted rules also require certain applicants to comply

with EPA’s PSD regulation at 40 CFR 52.21, as adopted by reference in NAC 445B.221 and provides authority for NDEP to impose any reasonable conditions on approval, including monitoring. Also, under NAC 445B.308, issuance of an operating permit for any stationary source does not affect the responsibilities of the source owner to comply with any other portion of the control strategy.

NAC 445B.310 – Environmental evaluation: applicable sources , as amended in section 4 of Regulation R139-06, adopted by the State Environmental Commission on September 6, 2006

. Existing SIP rules: NAQR article 13.2.1, 13.2.2, and 13.2.3, submitted28 July 24, 1979 and approved on June 23, 1982 (47 FR 27070); and NAQR article 13.1.7, submitted on April 1, 1974 and approved on March 26, 1975 (40 FR 13306). This submitted rule establishes thresholds based on potential to emit (PTE) for determining which new or modified stationary sources are subject to the EE requirement established in NAC 445B.308. For a new source, the threshold is a PTE of 25 tons per year of a regulated air pollutant; for a modification of a source with a PTE greater than 25 tons per year, the threshold is a PTE of 10 tons per year of a regulated air pollutant. Notwithstanding the above, NAC 445B.310 requires EEs for all applications for approval of PALs and expiration of PALs. The corresponding EE threshold under the existing SIP rule is approximately 100 tons per year, and thus, the submitted rule would strengthen the SIP by establishing a lower EE requirement threshold.

NAC 445B.311 – Environmental evaluation: required information

, as amended in section 10 of Regulation R151-06, adopted by the State Environmental Commission on September 6, 2006

. Existing SIP rule: NAQR article 13.3, 13.3.1, 13.3.1.1, and 13.3.1.2), submitted on July 24, 1979 and approved on June 12, 1982 (47 FR 27070). This submitted rule establishes content requirements for EEs, including general description information, but also detailed requirements related to good engineering practice stack height determinations, dispersion modeling, and meteorological information. Subsection (3) of NAC 445B.311 relies on NAC 445B.083, which has not been, but must be, submitted for approval as part of the SIP.

Code of Federal Regulations, title 40, part 51, section 160

establishes the requirement for States to include in their SIPs legally enforceable procedures for permitting of new or modified sources, and subsection (f) of 40 CFR 51.160 requires that such procedures must discuss the air quality data and the dispersion or other air quality modeling used to meet the requirements of the permitting program. Subsection (f)(1) of 40 CFR 51.160 requires that air quality modeling be based on air quality models, databases, and other requirements specified in appendix W of 40 CFR part 51 (i.e., Guideline on Air Quality Models). Further, subsection (f)(2) of 40 CFR 51.160 allows for case-by-case modification or substitution of models, databases, and other requirements specified in appendix W with written approval of EPA and after notice and opportunity for public comment. NAC 445B.311(4)(a) requires that air quality modeling be based on air quality models, databases, and other requirements specified in appendix W but allows NDEP to
authorize use of a modification or substitution of such a model29 if NDEP determines that the modification or substitution is appropriate but does not require NDEP to seek written approval from EPA nor does the rule require notice and opportunity for public comment. NAC 445B.311 must be amended accordingly to comply with 40 CFR 51.160(f).

NAC 445B.313 – Method for determining heat input: class I

sources. Existing SIP rule: NAQR article 13.2.4, submitted on July 24, 1979 and approved on June 23, 1982 (47 FR 27070). This submitted rule provides that, for the purposes of determining the effects of a class I source on the quality of the ambient air and for the purposes of determining the applicability of a federally enforceable standard or requirement to an emission unit, the heat input will be determined by using the appropriate method of the ASTM contained in 40 CFR parts 51, 52, 60, and 61.

First, NAC 445B.313 does not identify the appropriate method for determining heat input for combustion sources. Applicability determinations for combustion sources must be based on maximum heat input. The method for determining maximum heat input is well established and is determined by combining the maximum fuel rate, determined by the manufacturer, with the total calorific value of the fuel, determined by the latest applicable ASTM methods. Second, while ASTM methods are appropriate for determining calorific values of fuels, the general reference in NAC 445B.313 to appropriate ASTM methods in 40 CFR parts 51, 52, 60, and 61 is too vague to be enforceable. NAC 445B.313 must be amended accordingly.

NAC 445B.3135 – Method for determining heat input: class II

sources. Existing SIP rule: NAQR article 13.2.4, submitted on July 24, 1979 and approved on June 23, 1982 (47 FR 27070). This submitted rule provides that, for the purposes of determining the effects of a class II source on the quality of the ambient air in an EE, the heat input is the aggregate heat content of all combusted fuels, or the guaranteed maximum input of the manufacturer or designer of the equipment, whichever is greater. The total heat input of all fuel-burning units in a plant or on the premises must be used to determine the maximum amount of a regulated air pollutant which may be emitted.

NAC 445B.314 – Method for determining heat input: class III

sources. Existing SIP rule: NAQR article 13.2.4, submitted on July 24, 1979 and approved on June 23, 1982 (47 FR 27070). This submitted rule establishes the same method for determining heat30 input for class III sources as set forth in NAC 445B.3135 for

class II sources.

NAC 445B.315 – Contents of operating permits: exception for operating permits to construct; required conditions. This rule would be new to the Nevada SIP. This rule, which does not apply to operating permits to construct, specifies content requirements for operating permits, requires NDEP to specify the legal authority for each condition of the permit and specifies 11 conditions that must be contained in operating permits, including such conditions as a 5-year term; record retention; severability; compliance requirement and potential consequences of noncompliance; authority for NDEP to revise, revoke and reissue, reopen and revise, or terminate permits for cause; non-conveyance of a property right; agreement to provide the director with information; authorization for inspections by NDEP; and certifications of truth, accuracy, and completeness by responsible officials of the stationary source for any documents required to be submitted by any condition of the permit.

NAC 445B.318 – Operating permits: separate permit required for

each source; form of application; issuance or denial of permit; posting of permit , as amended in section 11 of Regulation R151- 06, adopted by the State Environmental Commission on September 6, 2006

. Existing SIP rules: NAC 445.707 [subsection (1), first sentence, and subsection (2)], 445.712 [subsection (2)] and 445.714, submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule includes various requirements for operating permits, including a requirement for such a permit for each new or existing stationary source, provisions related to application forms and replacement permits and the posting of permits. This rule includes essentially all of the requirements found in the corresponding existing SIP rules. Like existing SIP rule NAC 445.712, NAC 445B.318
restricts the discretion of NDEP to withhold issuance of an operating permit under certain circumstances.

NAC 445B.319 – Operating permits: administrative amendment

, excluding paragraph (b) of subsection (3)

. This rule would be new to the Nevada SIP, and it identifies the types of permit revisions that qualify as administrative amendments, such as typographical errors, changes in phone numbers, and changes in ownership under certain conditions. These revisions are largely the same as the types of that EPA identifies as administrative in nature in 40 CFR 70.7(d). This submitted rule also includes a reference to NAC 445B.327, a rule that has not been submitted31 as part of the SIP revision, but in this case, the “hanging”
reference need not be submitted because it relates to fees. As a general matter, the CAA does not require permit-related fee provisions to be included in SIPs in areas, such as the area under NDEP jurisdiction, where title V programs have been approved.

NAC 445B.325 – Operating permits: Termination, reopening and

revision, revision, or revocation and reissuance , excluding subsections (1), (3), and (4)

. This rule would be new to the Nevada SIP, and it identifies the circumstances under which an operating permit may be terminated, reopened and revised, revised, or revoked and reissued. Such circumstances include determinations by NDEP or EPA that a permit contains a material mistake, is based on inaccurate statements, or does not as written ensure compliance with all applicable requirements, or determinations by NDEP that there has been a violation of the State’s air pollution regulations or any condition contained in the permit. This provision also limits the revision of permits to those portions of the permit for which cause existed for reopening and provides that reopenings of a permit must comply with all of the relevant requirements for the issuance or revision of a permit, including procedural requirements.

NAC 445B.326 – Operating permits: assertion of emergency as affirmative defense to action for noncompliance. This rule would be new to the Nevada SIP, and it establishes an affirmative defense to actions brought for noncompliance with a technology-based emission limitation contained in the operating permit if the holder of the permit demonstrates through signed, contemporaneous operating logs or other relevant evidence that an emergency occurred and the holder of the permit can identify the cause of the emergency, that the facility was being properly operated at the time of the emergency, that all reasonable steps were taken during the emergency to minimize excess emissions, and that holder submitted timely notification to NDEP. Under this rule, the holder of the operating permit who invokes this rule bears the burden of proof.

This provision is modeled off of 40 CFR 70.6(g) and is acceptable as applied to permit conditions; however, it is not approvable under CAA section 110(a)(2) if applied to technology-based emission limitations approved into the SIP. Because of the potential for confusion, NAC 445B.326 should be withdrawn from further consideration as part of the Nevada SIP or must be revised to clarify that the affirmative defense applies only to actions brought for noncompliance of permit32 conditions and not to technology-based emission limitations approved into the SIP.

NAC 445B.331 – Request for change of location of emission unit

, as amended in section 12 of Regulation R151-06, adopted by the State Environmental Commission on September 6, 2006

. Existing SIP rule: NAC 445.716, submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule sets forth requirements (e.g., in advance and in writing, submitted with fee) for changing the locations of emissions units that are similar to the requirements in the corresponding rule in the SIP. This submitted rule does not clearly apply only to changes in location of emission units within the confines of an existing stationary source. Relocation of an
emission unit to a site outside of the source at which it is originally permitted should trigger new source review. The
State Environmental Commission must amend NAC 445B.331 to clarify that NAC 445B.331 only provides for changes in locations of emission units within the confines of existing
sources at which the units are located.

**Class I Operating Permits (16) -**  NAC 445B.3361 – General requirements, as amended in section 6 of

Regulation R139-06, adopted by the State Environmental Commission on September 6, 2006, but excluding subsection 1, paragraph (b); subsection 5, paragraph (a), subparagraph (2); and subsections 6 and 7 of the amended rule (which relate to the non-criteria pollutant, mercury)

. Existing SIP rule: NAC 445.707 (subsection (1), second sentence), submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626), in connection with administrative revisions to operating permits to incorporate the conditions of class I operating permits to construct into the existing class I operating permits as set forth in NAC 445B.3361(7)(b). This submitted rule requires new or modified class I stationary sources to apply for and obtain operating permits to construct. It also contains separate provisions for PALs. Except under certain circumstances, once an owner or operator has obtained a valid operating permit to construct, the owner or operator need not obtain an operating permit before commencing construction, initial start-up and operation of the new or modified class I source but must submit a complete application of a class I operating permit within 12 months after the date of initial start-up.

NAC 445B.3363 – Operating permit to construct: application , as amended in section 7 of Regulation R139-06 and as amended in section 13 of Regulation R151-06, both of which were adopted by33 the State Environmental Commission on September 6, 2006

. First of all, we note that NDEP has submitted two different versions of NAC 445B.3363. One version reflects changes adopted in Regulation R139-06, and the other reflects changes adopted in Regulation R151-06. NDEP must re-submit a single version of the rule or withdraw one of the two versions to avoid unnecessary
confusion.

These rules would be new to the Nevada SIP, and they set forth additional content requirements for application for class I operating permits to construct or revisions of class I operating permits to construct. Specific additional requirements are also established for applications for operating permits to construct for new major stationary sources and major modifications as well as non-major modifications at existing major stationary sources. Exceptions are provided in
relation to PALs.

NAC 445B.33637 – Operating permit to construct for approval of

plantwide applicability limitation: Application. This rule would be new to the Nevada SIP, and it establishes content requirements for applications for operating permits to construct for the approval of PALs for major stationary sources, operating permits to construct to allow PALs to expire and not be renewed, operating permits to construct for the renewal of PALs, and operating permits to construct for increasing PALs.

NAC 445B.3364 – Operating permit to construct: review of application and determination of completeness by director;
notice , as amended in section 8 of Regulation R139-06 and as amended in section 14 of Regulation R151-06, both of which were adopted by the State Environmental Commission on September 6,

2006

. Existing SIP rules: NAC 445.707 [subsections (3), (4), and (5)], submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626) and NAQR article 13.1.2, submitted on July 24, 1979 and approved on June 23, 1982 (47 FR 27070). First of all, we note that NDEP has submitted two different versions of NAC 445B.3364. One version reflects changes adopted in Regulation R139-06, and the other reflects changes adopted in Regulation R151-06. NDEP must re-submit a single version of
the rule or withdraw one of the two versions to avoid unnecessary confusion.

These submitted rules establish deadlines for NDEP review of application for class I operating permits to construct or revisions to class I operating permits to construct. These34 timelines include completeness determinations, preliminary intents to issue or deny, and final decisions on permit applications. Separate deadlines are established for applications involving PALs. NAC 445B.3364 also establishes public participation requirements, including publication of notice and provision for a 30-day comment period and indicates the types of information that NDEP will take into account when making the final decision to issue or deny the permit, including the effect of such a facility on the maintenance of state and national ambient air quality standards found in NAC

445B.22097.

NAC 445B.3365 – Operating permit to construct: required
conditions , as amended in section 9 of Regulation R139-06, adopted by the State Environmental Commission on September 6,

2006

. This rule would be new to the Nevada SIP, and it extends essentially the same required conditions set forth in NAC 445B.315 for operating permits to class I operating permits to construct with exceptions for operating permits to construct for approval of PALs.

NAC 445B.33656 – Operating permit to construct for approval of

plantwide applicability limitation: required conditions and information, as amended in section 10 of Regulation R139-06, adopted by the State Environmental Commission on September 6,

2006

. This rule would be new to the Nevada SIP, and it extends essentially the same required conditions set forth in NAC 445B.315 for operating permits to class I operating permits to construct for approval of PALs but with certain appropriate substitutions of the requirements in NAC 445B.315 with those from 40 CFR 52.21(aa).

NAC 445B.3366 – Operating permit to construct: expiration;

extension , as amended in section 11 of Regulation R139-06, adopted by the State Environmental Commission on September 6,

2006

. Existing SIP rule: NAC 445.707 [subsection (6)], submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule establishes expiration dates for operating permits to construct for construction occurring in a single phase and for construction occurring in multiple phases. Specific exceptions are established for class I operating permits to construct involving PALs.

The term “commence” is used in this rule but is not defined in NAC chapter 445B. The word “commenced” is defined in NAQR article 1.36, which is being retained in the SIP, but this old definition relates only to NSPS. Because the term “commenced”35 is subject to different interpretations and the existing SIP definition of the term does not apply in the permitting context, the State Environmental Commission must adopt a
definition of “commence” in relation to the construction of
sources or modifications based on EPA’s definition of “commence” in 40 CFR 51.166(b)(9) as well as the related definitions for “necessary preconstruction approvals or permits,” and “begin actual construction” in 40 CFR 51.166(b)(10) and (11).

NAC 445B.3368 – Application: additional requirements; exception.

This rule would be new to the Nevada SIP, and it establishes additional content requirements for applications for operating permits for those facilities for which applications for operating permits to construct were not previously submitted. Such content requirements include applicable test methods, calculations, compliance plans, and compliance certifications. NAC 445B.3368 also establishes specific additional requirements for applications for class I-B applications for class I operating permits.

NAC 445B.3375 – Class I-B application: filing requirement , as amended in section 12 of Regulation R139-06, adopted by the State Environmental Commission on September 6, 2006, but excluding subsections (2) and (3)

. Existing SIP rule: NAC 445.707 (subsection (1), second sentence), submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626), in connection with class I sources. This submitted rule requires stationary sources to file an class I-B application and obtain a class I operating permit before commencing the construction, reconstruction or modification of existing or proposed class I stationary sources, certain modifications to class I sources,
and modifications of class II sources that result in total emissions above the thresholds for a “major source” as defined
in NAC 445B.094.

NAC 445B.3395 – Review of application and determination of completeness by director; notice; expiration of permit , as amended in section 15 of Regulation R151-06, adopted by the State Environmental Commission on September 6, 2006, but excluding subsections (13), (14), and (15)

. Existing SIP rule: NAC 445.707 [subsections (3), (4), and (5)], submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule establishes similar types of requirements for review by NDEP of applications for class I operating permits and significant revisions to class I operating permits as established in NAC 445B.3364 for applications for class I36 operating permits to construct and revisions to class I operating permits to construct.

NAC 445B.340 – Prerequisites to issuance, revision or renewal of

permit , excluding subsection (3)

. This rule would be new to the Nevada SIP, and it identifies prerequisites for NDEP’s issuance of a class I operating permit, or a revision of or a renewal of a class I operating permit.

NAC 445B.342 – Revision of permit: exception when making certain changes; notification of changes , as amended in section 22 of Regulation R096-05, adopted by the State Environmental Commission on October 4, 2005, but excluding paragraph (e) of subsection (3)

. This rule would be new to the Nevada SIP, and it allows owners and operator of a stationary source to make changes which contravene an express term of the operating permit without a revision of the operating permit under certain specified circumstances. This rule does not allow changes to conditions related to monitoring, methods of testing, recordkeeping, reporting, or compliance certification. For each change, the owner or operator must provide written notification to NDEP and EPA at least 7 days before making the change.

NAC 445B.3425 – Minor revision of permit. Existing SIP rule: NAC 445.707 [subsection (3)], submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule identifies several types of revisions that qualify as minor and thus are subject to a streamlined process that does not include public review. The submitted rule is largely patterned off of 40 CFR 70.7(e)(2) with respect to the types of revisions that qualify as minor.

NAC 445B.344 – Significant revision of permit. This rule would

be new to the Nevada SIP, and it allows holders of operating permits to request a significant revision to a class I operating permit if the proposed change does not qualify as an administrative amendment, a minor revision, or as the type of change for which no revision to the operating permit is necessary. This rule establishes content requirements for applications for significant revision to class I operating permits and requires the same extent of public participation as required for initial class I operating permits.

NAC 445B.3441 – Administrative revision of permit to incorporate conditions of certain permits to construct , as amended in section 13 of Regulation R139-06, adopted by the State Environmental Commission on September 6, 2006

. This rule would37 be new to the Nevada SIP, and it establishes content and public process requirements for applications for administrative revisions to a class I operating permit to incorporate the conditions of class I operating permits to construct for the class I stationary source.

NAC 445B.3443 – Renewal of permit. Existing SIP rule: NAC 445.713, submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule provides for renewal of operating permits 5 years from the date of issuance and establishes the schedule that must be followed for permit renewals, identifies the content requirements for applications for renewals, and specifies the related fees. As such, the submitted rule contains the same types of requirements as the corresponding rule in the existing SIP.

**Class II Operating Permits (6) -**  NAC 445B.3453 – Application: general requirements. Existing SIP rule: NAC 445.707 (subsection (1), second sentence), submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626), in connection with class II sources. This submitted rule requires owners or operators of sources not subject to the permitting requirements for class I sources to file an application and obtain a class II or III operating permit or a revision to such a permit before commencing construction of the proposed stationary source or proposed modification.

NAC 445B.3457 – Application: determination of completeness by

director , as amended in section 16 of Regulation R151-06, adopted by the State Environmental Commission on September 6,

2006

. Existing SIP rule: NAC 445.707 [subsection (3)], submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule establishes the deadlines for review of applications for class II operating permits and revisions to class II operating permits. This rule also establishes public participation requirements for class II sources for which NDEP determines that the change to the stationary source results in a significant change in air quality at any location where the public is present on a regular basis. Thus, public participation is contingent upon NDEP’s broad discretionary authority. By reducing the requirements for notice and opportunity for public comment, this submitted provision would weaken the existing SIP with respect to permitting of all sources except class I sources. In addition, the limited public participation provided for in this rule does not comply with the requirements of 40 CFR 51.161 and must be amended accordingly.38 NAC 445B.346 – Required contents of permit , excluding subsection
(6)

. This rule would be new to the Nevada SIP, and it
identifies conditions that must be contained in class II operating permits in addition to the general conditions that apply under NAC 445B.315.

NAC 445B.3465 – Application for revision as amended in section 23 of Regulation R096-05, adopted by the State Environmental Commission on October 4, 2005

. This rule would be new to the Nevada SIP, and it authorizes revisions to class II operating permits and establishes content requirements for applications
for such revisions.

NAC 445B.3473 – Renewal of permit. Existing SIP rule: NAC 445.713, submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule provides for renewal of operating permits 5 years from the date of issuance and establishes the schedule that must be followed for permit renewals, identifies the content requirements for applications for renewals, and specifies the related fees. As such, this submitted rule contains the same types of requirements as the corresponding rule in the existing SIP.

NAC 445B.3477 – Class II general permit. This rule would be new to the Nevada SIP, and it authorizes NDEP to issue class II general permits covering numerous similar stationary sources. This rule allows for challenge to the contents of class II general permits but not to the grant or denial of authority to operate under a class II general permit.

This rule does not identify the requirements for general

permits, the public participation requirements for issuing such permits, nor the criteria by which stationary sources may qualify for such a permit. NAC 445B.3477 must be amended accordingly.

**Class III Operating Permits (5) –**  NAC 445B.3485 – Application: general requirements , as amended in section 17 of Regulation R151-06, adopted by the State Environmental Commission on September 6, 2006

. Existing SIP rule: NAC 445.707 (subsection (1), second sentence), submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626), in connection with class III sources. This submitted rule allows an owner or operator of a source that meets the
definition of the term “class III source” in NAC 445B.038 to apply for a class III operating permit. Such a permit must be39 obtained before commencing construction of a new class III stationary source or a modification of an existing class III stationary source.

NAC 445B.3487 – Application: determination of completeness by

director, as amended in section 18 of Regulation R151-06, adopted by the State Environmental Commission on September 6, 2006. Existing SIP rule: NAC 445.707 [subsection (3)], submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule establishes deadlines for review of applications for class III operating permits or revisions to class III operating permits.

NAC 445B.3489 – Required content of permits , as amended in section 15 of Regulation R151-06, adopted by the State Environmental Commission on September 6, 2006

. This rule would be new to the Nevada SIP, and it identifies conditions that must be contained in class III operating permits in addition to the general conditions that apply under NAC 445B.315.

NAC 445B.3493 – Application for revision. This rule would be new to the Nevada SIP, and it authorizes revisions to class III operating permits and establishes content requirements for applications for such revisions.

NAC 445B.3497 – Renewal of permits. Existing SIP rule: NAC 445.713, submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This submitted rule provides for renewal of operating permits 5 years from the date of issuance and establishes the schedule that must be followed for permit renewals, identifies the content requirements for applications for renewals, and specifies the related fees. As such, the submitted provision contains the same types of requirements as the corresponding rule in the existing SIP.

**V. EVALUATION OF SUBMITTED RULES**

In this section, we present our evaluation of the permitting program consisting of the submitted rules discussed
in section IV above. Based on the evaluation and for the reasons provided below, we conclude that permitting program consisting of the submitted rules should be disapproved. (For thosesubmitted rules that are separable from the rest, our rulespecific evaluations and recommendations are provided in section IV, above, and not repeated here.)40 **A. COMPLIANCE WITH MINIMUM REQUIREMENTS ESTABLISHED IN CAA SECTIONS 110(a)(2), 110(l), AND 193** 

Section 110(a)(2) of the Act establishes specific requirements for state implementation plans (SIPs) adopted by States under CAA section 110(a)(1) to implement, maintain, and enforce the NAAQS within each State. Among these requirements are that each plan must include “enforceable emission limitations and other control measures, means, or techniques,” and must include “a program to provide for the ... regulation of the modification and construction of any stationary source within the areas covered by the plan as necessary to assure that NAAAQS are achieved, including a permit program as required in parts C and D of this subchapter.” 7 See CAA section 110(a)(2)(A) and (C).

Discussion : The concept of “enforceability” in CAA section 110(a)(2)(A) refers to various aspects of a rule, or set of rules, including, but not limited to, legal authority, vague or ambiguous terms, unlimited discretion, and practical considerations of monitoring, compliance, reporting and recordkeeping.

First, we find that NDEP has sufficient legal authority under the Nevada Revised Statutes (NRS) to administer and enforce the requirements of its permitting program. Many of the relevant statutes have recently been updated in the SIP, see 71 FR 51766 (August 31, 2006), or are the subject of a proposed approval, see 71 FR 50875 (August 28, 2006).

Second, we note that there are several instances where a submitted rule relies on other rules or statutory provisions that have not been submitted for approval, or on terms that have not been defined, but that are needed for unambiguous interpretation. We also note several instances where more than one version of a rule has been included in a given submittal.
These include:

• NAC 445B.287 – Operating permits: general requirements; exception; restriction on transfers. This rule exempts sources in subsection 2 of that rule from permit revision requirements but subsection 2 of NAC 445B.287 was not included in the January 12, 2006 SIP revision submittal.

7 The set of submitted rules addressed in this TSD represents the entire regulatory portion of NDEP’s stationary source permitting program as required under title I of the CAA except for rules specifically related to permitting of new major sources or major modifications under parts C and D (of title I ).41 • NAC 445B.104 – “Motor vehicle” defined, which cites NRS 485.050, which contains the actual definition of “motor vehicle”; this term is important for the purpose of interpreting the term “stationary source” in NAC 445B.187.

• NAC 445B.179 – “Special mobile equipment” defined, which cites NRS 482.123, which contains the actual definition of “special mobile equipment”; this term is important for the purpose of interpreting the term “stationary source” in NAC

445B.187.

• NAC 445B.308 – Prerequisites and conditions for issuance of operating permits: environmental evaluation; compliance with control strategy; exemption from environmental
evaluation. NDEP submitted two different versions of this rule in the SIP revision submittal dated December 8, 2006 and must re-submit a single version of the rule or withdraw one of the two versions to avoid unnecessary confusion.

• NAC 445B.311 – Environmental evaluation: Required
information

. Subsection (3) of NAC 445B.311 relies on NAC 445B.083, which has not been submitted as part of the SIP.

• NAC 445B.3363 – Operating permit to construct: application.
NDEP submitted two different versions of this rule in theSIP revision submittal dated December 8, 2006 and must resubmit a single version of the rule or withdraw one of the two versions to avoid unnecessary confusion.

• NAC 445B.3364 – Operating permit to construct: review of application and determination of completeness by director;
notice. NDEP submitted two different versions of this rule in the SIP revision submittal dated December 8, 2006 and must re-submit a single version of the rule or withdraw one of the two versions to avoid unnecessary confusion.

In addition, two submitted provisions are vague or ambiguous because of incorrect citations to Federal rules or because important terms are not defined and must be amended and re-submitted. These provisions include:

• NAC 445B.069 - “Federally enforceable” defined. This provision refers to EPA enforcement pursuant to 40 CFR 51.160 to 166 or 40 CFR part 70, but 40 CFR 51.160 to 166 and 40 CFR part 70 are not the basis for EPA enforcement42 but rather they are rules establishing requirements for States’ pre-construction and operating permit rules. NAC 445B.069 must be revised to more closely match EPA’s definition of the same term in 40 CFR 51.166(b)(17); and

• NAC 445B.3366 – Operating permit to construct: expiration;
extension. The term “commence” is used in this rule but is not defined in NAC chapter 445B. The word “commenced” is defined in NAQR article 1.36, which is being retained in the SIP, but this old definition relates only to NSPS. Because the term “commenced” is subject to different interpretations and the existing SIP definition of the term does not apply in the permitting context, the State Environmental Commission must adopt a definition of
“commence” in relation to the construction of sources or
modifications based on EPA’s definition of “commence” in 40 CFR 51.166(b)(9) as well as the related definitions for “necessary preconstruction approvals or permits,” and “begin actual construction” in 40 CFR 51.166(b)(10) and
(11).

Third, issues concerning practicable enforceability are raised directly by submitted rule NAC 445B.138 (“Potential to emit” defined). This rule must be amended to require effective
limits and also to include criteria under which a limit will be deemed to be practicably enforceable (i.e., effective) by NDEP.
Such criteria could include:

• a requirement for the source to maintain emissions below a threshold or significance level that identifies each emission unit(s) contribution to the limit and any restrictions, control devices, or control measures employed;

• the compliance determination period (e.g., hourly, daily, monthly, but not exceeding a 12-month rolling total calculated monthly depending on the compliance method used);

• the method for quantifying emissions and determining compliance with the PTE limit; and

• procedures and criteria for routine verification of monitoring data and of compliance, including recordkeeping, reporting, and testing in agreement with the method for quantifying emissions and determining compliance with the
PTE limit.43 Fourth, the affirmative defense provision included in submitted rule NAC 445B.326 (“Operating permits: assertion of emergency as affirmative defense to action for noncompliance”) is acceptable as applied to permit conditions but is notapprovable under CAA section 110(a)(2) if applied to technologybased emission limitations approved into the SIP. Because of the potential for confusion, NAC 445B.326 should be withdrawn from further consideration as part of the Nevada SIP or must be revised to clarify that the affirmative defense applies only to actions brought for noncompliance of permit conditions and not to technology-based emission limitations approved into the SIP.

Section 110(l) of the CAA states: “Each revision to an implementation plan submitted by a State under this chapter shall be adopted by such State after reasonable notice and public hearing. The Administrator shall not approve a revision of a plan if the revision would interfere with any applicable requirement concerning attainment and reasonable further progress (as defined in section 7501 of this title), or any other applicable requirement of this chapter.”

Discussion : The State has provided sufficient evidence of notice and hearing for SEC’s adoption of the permit-related rules submitted on January 12, 2006 and evaluated herein. See volume II of the February 16, 2005 SIP revision submittal. Approval of the submitted set of permitting-related rules and supercession of the permitting-related rules in the existing SIP would not interfere with attainment of the NAAQS or reasonable further progress toward attainment of the NAAQS because the rules are essentially administrative and procedural in nature. In addition, we are unaware of any reliance by NDEP on the continuation of any aspect of the permit-related rules in the NDEP portion of the existing Nevada SIP for the purpose of continued attainment or maintenance of the NAAQS.

Section 193 of the CAA states in relevant part: “No control requirement in effect, or required to be adopted by an order, settlement agreement, or plan in effect before November 15, 1990, in any area which is a nonattainment area for any air pollutant may be modified after November 15, 1990, in any manner unless the modification insures equivalent or greater emission reductions of such air pollutant.” EPA does not believe that NSR programs are control requirements for the purposes of section 193. See 70 FR 39413, at 39417 (July 8, 2005). However, we recognize that, on December 22, 2006, the D.C. Circuit issued a
decision on South Coast Air Quality Management District v. EPA

, No. 14-1200, that may lead EPA to modify its interpretation of44 “control requirement” for the purposes of CAA section 193. Nonetheless, even if NSR were considered a “control requirement,” we find that the submitted rule would not have an
effect on emissions in nonattainment areas because of the administrative and procedural nature of the changes that are the subject of this review, and because the one provision in the existing SIP that relates specifically to nonattainment areas, NAQR article 13.1.3(2), would be unaffected by action on the submitted rules, i.e., it would remain in the SIP.

**B. COMPLIANCE WITH MINIMUM REQUIREMENTS ESTABLISHED FOR**

**STATIONARY SOURCE PERMIT PROGRAMS IN 40 CFR PART 51 (“REQUIREMENTS FOR PREPARATION, ADOPTION, AND SUBMITTAL OF**  **IMPLEMENTATION PLANS”), SUBPART I (“REVIEW OF NEW SOURCES AND MODIFICATIONS”), EXCLUDING 40 CFR 51.165 AND 51.166** 

We review the compliance of the submitted set of rules with

EPA’s regulations in 40 CFR 51, subpart I, excluding 40 CFR 51.165 and 51.166, which relate to review and permitting of new major sources and major modifications under parts C and D of
title I of the CAA.

40 CFR 51.160 – Legally enforceable procedures

(a) Each plan must set forth legally enforceable procedures that enable the State or local agency to determine whether the construction or modification of a facility, building, structure or installation or combination of these will result in (1) a violation of applicable portions of the control strategy; or (2)
interference with attainment or maintenance of a national standard in the state in which the proposed source (or modification) is located or in a neighboring State.

Discussion: The requirement set forth in NAC 445B.208 for sources to prepare environmental evaluations (EE) represents a legally enforceable procedure that enables NDEP to determine whether a new or modified source would violate any applicable portion of the control strategy or interfere with attainment or maintenance of the NAAQS. We note that the EE requirement does not provide for an evaluation of the potential for interference with respect to the PM 2.5 NAAQS because the PM 2.5 NAAQS is not included in the table of ambient air quality standards in NAC 445B.22097. However, under our current policies, PM 10 may properly be used as a surrogate for PM 2.5 in meeting NSR requirements until technical difficulties related to modeling and treatment of precursors, among other issues, is resolved. See EPA Memorandum entitled, “Interim Implementation of New45 Source Review Requirements for PM-2.5,” from John S. Seitz, Office of Air Quality Planning & Standards, dated October 23, 1997, and EPA Memorandum entitled, “Implementation of New Source Review Requirements in PM-2.5 Nonattainment Areas,” from Stephen D. Page, Office of Air Quality Planning and Standards, dated April 5, 2005.

Thus, the submitted rules require applicants for air quality permits to submit the types of information that allow NDEP to make the types of determinations called for in 40 CFR 51.160. There are, however, deficiencies in certain rules that prevent us from concluding that the submitted set of rules complies fully with 40 CFR 51.160. There deficiencies are as

follows:

• NAC 445B.187 – “Stationary source” defined. NAC 445B.187 excludes “special mobile equipment” from the definition of stationary source with the result that the term may not be as inclusive as the phrase “facility, building, structure or installation” in 40 CFR 51.160. “Special mobile equipment” may include engines and vehicles not considered “nonroad” and that must be included in the permitting program. See EPA’s General Preamble for the Implementation of Title I of the Clean Air Act Amendments of 1990, 57 FR 13498, at 13555 (April 16, 1992) for a discussion of CAA section 302(z) (“stationary source” definition). The State Environmental Commission must amend this rule accordingly or NDEP must explain how it complies with CAA section
302(z).

• NAC 445B.313 – Method for determining heat input: class I

sources. First, NAC 445B.313 does not identify the appropriate method for determining heat input for combustion sources. Applicability determinations for combustion sources must be based on maximum heat input. The method for determining maximum heat input is well established and is determined by combining the maximum fuel rate, determined by the manufacturer, with the total calorific value of the fuel, determined by the latest applicable ASTM methods. Second, while ASTM methods are appropriate for determining calorific values of fuels, the general reference in NAC 445B.313 to appropriate ASTM methods in 40 CFR parts 51, 52, 60, and 61 is too vague to be enforceable. This rule must be amended accordingly.

• NAC 445B.331 – Request for change of location of emission
unit. This submitted rule does not clearly apply only to46 changes in location of emission units within the confines of an existing stationary source. Relocation of an emission
unit to a site outside of the source at which it is originally permitted should trigger new source review. The
State Environmental Commission must amend NAC 445B.331 to clarify that NAC 445B.331 only provides for changes in locations of emission units within the confines of existing
sources at which the units are located.

• NAC 445B.3477 – Class II general permit . This submitted rule does not identify the requirements for general permits, the public participation requirements for issuing such permits, nor the criteria by which stationary sources may qualify for such a permit. To be approved, the rule must be amended accordingly.

(b) Such procedures must include means by which the State or local agency responsible for final decision-making on the application for approval to construct or modify will prevent such construction or modification if (1) it will result in a violation of applicable portions of the control strategy; or (2)
it will interfere with the attainment or maintenance of a
national standard.

Discussion : Submitted rule NAC 445B.308 (“Prerequisites and conditions for issuance of operating permits: Environmental evaluation; compliance with control strategy; exemption from environmental evaluation”) states that NDEP shall not issue an operating permit or revision to an operating permit if the EE shows, or NDEP determines, that the stationary source would prevent attainment and maintenance of the NAAQS or will cause a violation of the applicable control strategy contained in the approved air quality plan. This submitted rule specifically refers to the NAAQS in NAC 445B.22097 as a basis for a denial of a permit. This is acceptable.

(c) The procedures must provide for the submission, by the owner of operator of the building, facility, structure, or installation to be constructed or modified, of such information on (1) the nature and amounts of emissions to be emitted by it or emitted by associated mobile sources; (2) the location, design, construction, and operation of such facility, building, structure, or installation as may be necessary to permit the State or local agency to make the determination referred to in paragraph (a) of this section.47 Discussion : The EE requirement for applications for certain new or modified sources provides for the submission of the necessary
information to allow NDEP to make the determinations referred to in 40 CFR 51.160(a). See NAC 445B.311 (“Environmental evaluation: Required information”). EEs are required for all sources with PTEs greater than 25 tons per year of a criteria pollutant or a modification of a source (with a PTE greater than 25 tons per year) that has a PTE greater than 10 tons per year of a criteria pollutant. This is acceptable.

(d) The procedures must provide that approval of any construction or modification must not affect the responsibility on the owner or operator to comply with applicable portions of the control strategy.

Discussion : Submitted rule NAC 445B.308 (“Prerequisites and conditions for issuance of operating permits: Environmental evaluation; compliance with control strategy; exemption from environmental evaluation”) satisfies this requirement in subsection (9) which states: “Approval and issuance of an operating permit or a revision of an operating permit for any stationary source does not affect the responsibilities of the owner or owners to comply with any other portion of the control strategy.” This provision is one of the rules that apply generally to operating permits for class I, class II, and class III sources. This is acceptable.

(e) The procedures must identify types and sizes of facilities, buildings, structures, or installations which will be subject to review under this section. The plan must discuss the basis for determining which facilities will be subject to
review.

Discussion : Submitted rule NAC 445B.288 (“Operating permits: Exemptions from requirements”) exempts certain emission units specified in the rule or designated by NDEP as “insignificant activities” from permitting. Categories of emissions units that are specified as insignificant activities largely mirror the historic exemptions that are found in the existing SIP. Activities that qualify for designation by NDEP as insignificant
include emission units with uncontrolled PTEs of less than 2 tons per year of criteria air pollutants. NAC 445B.288 requires that insignificant activities be included in the calculations used to determine major source status of stationary sources. All stationary sources that are not exempt under NAC 445B.288 are required to apply for and obtain an operating permit. The limited exemptions provided for in NAC 445B.288 are acceptable.48 (f) The procedures must discuss the air quality data and the dispersion or other air quality modeling used to meet the requirements of this subpart. (1) All applications of air quality modeling involved in this subpart shall be based on the applicable models, data bases, and other requirements specified in appendix W of this part (Guidelines on Air Quality Models). (2) Where an air quality model specified in appendix W of this part (Guideline on Air Quality Models) is inappropriate, the model may be modified or another model substituted. Such amodification or substitution of a model may be made on a caseby-case basis or, where appropriate, on a generic basis for a specific State program. Written approval of the EPA must be obtained for any modification or substitution. In addition, use of a modified or substituted model must be subject to notice and opportunity for public comment under procedures set forth in 40

CFR 51.102.

Discussion : Subsection (4)(a) in submitted rule NAC 445B.311 (“Environmental evaluation: required information”) requires that air quality modeling be based on air quality models, databases, and other requirements specified in appendix W but allows NDEP
to authorize use of a modification or substitution of such a
model if NDEP determines that the modification or substitution is appropriate but does not require NDEP to seek written approval from EPA nor does the rule require notice and opportunity for public comment. NAC 445B.311 must be revised to comply with 40 CFR 51.160(f).

40 CFR 51.161 – Public availability of information

(a) The legally enforceable procedures in 40 CFR 51.160 must also require the State or local agency to provide opportunity for public comment on information submitted by owners and operators. The public information must include the agency’s analysis of the effect of construction or modification on ambient air quality, including the agency’s proposed approval or disapproval.

Discussion : Generally speaking, the submitted rules provide for adequate public participation for new or modified class I sources, i.e., major sources, but do not provide for adequate public participation for new or modified class II sources. With respect to class II sources, NDEP may initiate public notice and comment if, after review of an application for a class II permit, NDEP determines that the change to the stationary source results in a significant change in air quality at any location49 where the public is present on a regular basis. See NAC 445B.3457 (“Application: Determination of completeness by Director”), subsection (5). As discussed further below, such a provision does not provide well-defined objective criteria for determining when public notice is required to meet the requirements of 40 CFR 51.161.

As noted above in connection with 40 CFR 51.160(e), the procedures for pre-construction review must identify types and sizes of facilities, buildings, structures, or installations which will be subject to review, and the SIP revision must discuss the basis for determining which facilities will be subject to review. States may exempt from review those changes that are not environmentally significant, consistent with the de minimis exemption criteria set forth in Ala. Power Co. v.

Costle , 636 F.2d 323, at 360-361 (D.C. Cir. 1979). Given the connection between the identification of sources subject to review in 40 CFR 51.160(e) and the corresponding public notice requirements in 40 CFR 51.161(a), NAC 445B.3457(5) essentially treats all class II sources (i.e., sources with potentials to emit less than 100 tons/year of any criteria pollutant) as de minimis by eliminating public notice for permits for new or modified class II sources except at the sole discretion of NDEP. NDEP has provided no justification for treating all class II sources as de minimis nor do we believe that NDEP could provide such a justification.

EPA does believe, however, that 40 CFR 51.161(a) allows for the tailoring of the public participation process for less environmentally significant sources and modifications. See, generally, 60 FR 45530, at 45548-45549 (August 31, 1995). For example, the current approach that allows for NDEP to require public notice for certain class II sources at NDEP’s discretion
could be limited to a subset of class II sources with PTEs below emissions thresholds documented by NDEP as de minimis and where such a source is not taking a limit, or relying on netting, to avoid major source review under PSD or part D. Conversely, under this scenario, all class II sources with PTEs greater than de minimis emissions thresholds or that rely on limits or netting to avoid major source review would be subject to the same public notice requirements as class I sources.

Lastly, we note that NAC 445B.3457, subsection (5) must be revised to clearly apply to both new sources and modifications (the reference to the “change to the stationary source” might be incorrectly interpreted to refer just to modifications).50 (b) For the purposes of paragraph (a) of this section, opportunity for public comment shall include, as a minimum, (1) Availability for public inspection in at least one location in the area affected of the information submitted by the owner or operator and of the State or local agency’s analysis of the effect on air quality; (2) A 30-day period for submittal of public comment; and (3) A notice by prominent advertisement in
the area affected of the location of the source information and analysis specified in paragraph (b)(1) of this section.

(c) Where the 30-day comment period required in paragraph (b) of this section would conflict with existing requirements for acting on requests for permission to construct or modify, the State may submit for approval a comment period which is consistent with such existing requirements.

Discussion : The submitted rules establish the required elements for public participation for those sources or modifications for which public participation requirements are triggered. For instance, NAC 445B.3364(6) provides for public inspection of NDEP’s review and preliminary intent to issue or deny an operating permit to construct in the air quality region where the source is located. NAC 445B.3364(7) provides for notice to the public and EPA through various means including publication of a prominent advertisement in a newspaper of general circulation in the area in which the stationary source is or in a state publication designated to give general public notice, and establishes a 30-day comment period for submission of written comments. This is acceptable.

(d) A copy of the notice required by paragraph (b) of this section must also be sent to the EPA through the appropriate Regional Office, and to all other State and local air pollution control agencies having jurisdiction in the region in which such
new or modified installation will be located. The notice also must be sent to any other agency in the region having responsibility for implementing the procedures required under this subpart. For lead, a copy of the notice is required for all point sources. The definition of point source for lead is given in 40 CFR 51.100(k)(2).

Discussion : As noted above, the submitted rules, e.g., NAC 445B.3364(7), provide for a copy of NDEP’s review and preliminary intent to issue or deny an operating permit to construct to be sent to EPA. However, the rules do not provide for notification to the two county agencies with which NDEP shares stationary source permitting responsibility, and given51 the importance of coordination among these agencies, the submitted rules that establish public participation requirements must be amended to specifically require that copies of NDEP’s review and preliminary intent to issue or deny an operating permit be sent to Washoe County Health District for those sources proposed to be constructed or modified in Washoe County and to the Clark County Department of Air Quality and Environmental Management in Clark County. Also, the rules must be amended to provide for public participation for sources of lead with PTE’s greater than 5 tons per year. See 40 CFR 51.100(k)(2).

40 CFR 51.162 – Identification of responsible agency

Each plan must identify the State or local agency which will be responsible for meeting the requirements of this subpart in each area of the State. Where such responsibility rests with an agency other than an air pollution control agency, such agency will consult with the appropriate State or local air pollution control agency in carrying out the provisions of this subpart.

Discussion : Nevada law identifies the State Department of Conservation and Natural Resources (DCNR) as the State agency responsible for issuing permits to new or modified sources in all areas of the State of Nevada (NDEP is a division within DCNR), except within counties whose populations exceed 100,000. In such counties, Nevada law provides that the applicable permitting agency is the district board of health, county board of health or board of county commissioners. See NRS 445B.300 and NRS 445B.500, both of which were recently approved on August 31, 2006 (71 FR 51766). The only two counties in Nevada whose populations exceed 100,000 are Washoe County and Clark County, both of which have their own air pollution control agencies.

The only exception to this basic regulatory structure for permitting of sources in Nevada relates to certain power plants that are subject to State, not county, jurisdiction notwithstanding their location within the State. See NRS 445B.500(5), approved into the SIP as noted above. Thus, the Nevada SIP identifies the State or local agency which is responsible for meeting the requirements of 40 CFR part 51, subpart I, in each area of the State.52 40 CFR 51.163 – Administrative procedures

The plan must include the administrative procedures, which will be followed in making the determination specified in paragraph (a) of 40 CFR 51.160.

Discussion : The submitted rules provide adequate administrative procedures to be followed by NDEP in making the determinations specified in 40 CFR 51.160(a), including application requirements, and specifically, requirements for environmental evaluations, as well as completeness determinations, preliminary findings, public participation (except as discussed above in connection with class II sources), and considerations in the final decision to issue or deny a permit. See NAC 445B.295 – Application: General requirements; NAC 445B.311 – Environmental evaluation: Required information; NAC 445B.3363 – Operating permit to construct: Application; NAC 445B.3364 – Operating permit to construct: Review of application and determination of completeness by director; notice; NAC 445B.3395 – Review of application and determination of completeness by director; notice; expiration of permit; and NAC 445B.3457 – Application: Determination of completeness by Director.

40 CFR 51.164 – Stack height procedures

Such procedures must provide that the degree of emission limitation required of any source for control of any air pollutant must not be affected by so much of any source’s stack height that exceeds good engineering practice or by any other dispersion technique, except as provided in 40 CFR 51.118(b). Such procedures must provide that before a State issues a permit to a source based on a good engineering practice stack height that exceeds the height allowed by 40 CFR 51.100(ii)(1) or (2), the State must notify the public of the availability of the demonstration study and must provide opportunity for public hearing on it. This section does not require such procedures to restrict in any manner the actual stack height of any source.

Discussion: The submitted rules include the necessary definitions of such terms as “good engineering practice stack height” and “dispersion technique,” the necessary public participation where “good engineering practice stack height” would exceed those otherwise defined as such, and the necessary prohibition is included in subsection (3) of NAC 445B.308. However, the prohibition contained in subsection (3) of NAC 445B.308 includes director’s discretion (... if “the Director53 determines” ... ), which must be removed in order for EPA to approve this provision as satisfying 40 CFR 51.164.

**C. OTHER ISSUES**

In this subsection, we discuss issues in individual rules that do not prevent us from approving the SIP revision submittal per se but for which we recommend clarification or minor

amendment.

• NAC 445B.036 – “Class I source” defined. We recommend that this definition be amended to clarify that the term “class I” source includes any physical change that would occur at a non-major source if the change would constitute a “major stationary source” by itself. See 40 CFR 51.166(b)(1)(i)( c ).

• NAC 445B.038 – “Class III source” defined. This submitted definition does not allow sources which are subject to the requirements of 40 CFR parts 60 (i.e., new source performance standards) or 61 [i.e., National Emission Standards for Hazardous Air Pollutants (NESHAP)] to qualify
as “class III” sources. The definition should be amended so that sources subject to 40 CFR part 63 (i.e., NESHAP for source categories) would also be ineligible for “class III”

status.

• Sec. 4 of R096-05 – “Good engineering practice stack height” defined. This submitted definition differs from EPA’s definition by replacing the phrase “stacks in existence before January 12, 1979” with the phrase “stacks that commenced construction on or before January 12, 1979.” While we do not find this difference to be significant, we recommend that NDEP fix this minor deficiency when the rule
is next amended.

• Unlike most of the adopted definitions that rely on 40 CFR 52.21, the definitions in NAC 445B.093, 445B.0945, 445B.1345, and 445B.142 refer only to 40 CFR 52.21 and do not specify 40 CFR 52.21 as incorporated by reference in

NAC 445B.221 . We recommend that the State Environmental Commission amend these definitions accordingly unless there is some reason not to specify the incorporation by reference in NAC 445B.221 in these particular definitions.54 • NAC 445B.252 - Testing and sampling , excluding paragraphs (b) and (c) of subsection (2) and excluding subsection (6)

. The submitted rule contains the following editing error: the phrase “method of reference” is used in NAC 445B.252(2)(a) when “reference method” is intended. See NAC 445B.152 (“Reference method” defined). This minor error should be corrected by the State Environmental Commission
when the rule is next amended.

• NAC 445B.288 – Operating permits: exemptions from requirements; insignificant activities . The submitted rule lists the following category of sources, among others, that are exempt from the requirement to obtain an operating permit: agricultural equipment used in the normal operation of a farm, other than agricultural equipment that is classified as, or located at, a source for which a permit is required under title V of the Act or which is subject to any standard set forth in 40 CFR part 60 or 61. The rule should be amended to exclude from exemption agricultural equipment which is submitted to any standard set forth in 40 CFR part 63 in addition to 40 CFR parts 60 or 61.

Second, NAC 445B.288 disqualifies (as an insignificant activity) emergency generators owned or operated by a class II source and whose potential to emit is calculated on the basis of less than 500 hours of operation. We can think of no rationale explanation for restricting this limitation to

class II sources and recommend that the rule be amended to extend this limitation to emergency generators at class I

sources as well.

• NAC 445B.33637 – Operating permit to construct for approval of plantwide applicability limitation: Application. There is text missing from subsection (1), paragraph (e): the
words “shall be” should be inserted between the words
“limitation” and “based.”

**VI. EVALUATION OF STATE REQUEST TO RESCIND CERTAIN PERMIT**

**RELATED RULES AND STATUTES (7)** 

Rule 25 of General Order No. 3, Nevada Public Service

Commission , submitted on October 13, 1980 and approved on April 13, 1982 (47 FR 15790). Our April 13, 1982 final rule indicates that this rule and the related statutory provisions (Utility Environmental Protection Act, discussed below) were submitted to satisfy one of the conditions of approval for the Las Vegas CO and ozone nonattainment plans under part D of the CAAA of55 1977. See 46 FR 21758 (April 14, 1981) (“(iii) By August 12, 1981, the State must submit regulations for the review and permitting of fossil fuel-fired electric steam generators.”)

Specifically, our April 1982 notice indicates that the rule and related statutory provisions were submitted to address the provisions of section 172(b)(11)(A) of the 1977 Amended Act. Section 172(b)(11)(A) requires that, for areas (like Las Vegas Valley) that demonstrate the need to extend the attainment date for ozone or CO from 1982 to 1987, States establish a program which requires, prior to issuance of any permit for construction or modification of a major emitting facility, an analysis of alternative sites, sizes, production processes, and environmental control techniques for such proposed source which demonstrates that benefits of the proposed source significantly outweigh the environmental and social costs imposed as a result of its location, construction, or modification. See, also, our proposed rule at 45 FR 59334, at 59338 (September 9, 1980).

NDEP indicates that this regulation was a temporary regulation that expired by operation of law on August 1, 1983, but the

Federal Register notice cited above does not indicate that it is a temporary regulation nor does this temporal limitation appear on the face of the rule itself. **RECOMMENDATION: DEFER TO**

**FUTURE RULEMAKING ON NONATTAINMENT NSR RULES.**

Article 1.60 – Effective date , submitted on December 29, 1978,

and approved on August 27, 1981 (46 FR 43141). NAQR article 1.60 defines “effective date” as “upon the filing of the regulations with the Secretary of State, or as specified in the exceptions contained in NRS 233B.070.” Article 1.60 is relied upon in the definition of “existing source” in article 1.73 and the definition of “new source” in article 1.114, and because articles 1.73 and 1.114 are being retained in the SIP, article
1.60 should also be retained. **RECOMMENDATION: DISAPPROVE REQUEST FOR RESCISSION.** 

Article 1.72 – Existing facility , submitted on December 10, 1976

and approved on August 21, 1978 (43 FR 36932). NAQR article 1.72 defines “existing facility” in the same way as EPA does in 40 CFR 60.2. Article 1.72 is relied upon in the definition of “major stationary source” in article 1.104, in the definition of “modification” in article 1.109, in the definition of “stationary source” in article 1.187, and the notification requirements for modifications in article 2.16.1.4. In this TSD, we are recommending disapproval of the amended stationary source permitting program, and if we finalize a disapproval of56 the program, article 1.72 will be needed to provide meaning to articles 1.104, 1.109, 1.187, and 2.16.1.4. **RECOMMENDATION: DISAPPROVE REQUEST FOR RESCISSION.** 

Article 13.1.3(3) – [Minor source BACT], submitted on March 17, 1980 and approved on April 14, 1981 (46 FR 21758). This existing SIP rule prohibits NDEP from issuing a registration certificate to a point source if the source is located in an attainment area and BACT is not determined and adopted as an
emission limitation for the source.

At the time of adoption by the State of article 13.1.3(3), the State defined BACT (in NAQR article 1) as applying to sources subject to the environmental evaluation (EE) requirement in
article 13. The Governor of Nevada submitted this definition of BACT as section 1 of the amendments to article 1 as part of a SIP revision submittal dated July 24, 1979, but EPA never took action to approve or disapprove section 1 of the amendments to article 1. In contrast, EPA approved the definition of “lowest achievable emission rate” (LAER), which was also submitted on July 24, 1979 and which also refers to the EE requirement, as a revision to the Nevada SIP. See 46 FR 21758 (April 14, 1981). In EPA’s 1981 final rule, we referred to the LAER definition as “Article 1 – Definition: No. 2 - LAER”). On July 24, 1979,
Nevada also submitted revisions to Article 13 that amended the EE threshold level from 50 pounds per hour (approximately 220 tons per year) to 23 pounds per hour (100 tons per year). We approved the lower threshold for the EE requirement on June 23,
1982 (47 FR 27070).

Our 1982 approval of the lower EE requirement automatically lowered the SIP threshold for application of the LAER requirement (to 100 tons per year) as well, but by not acting on the BACT definition (as submitted on July 24, 1979), the existing SIP would appear not to establish an emissions threshold for application of the BACT requirement and thus to require BACT for all new sources and modifications proposed in an attainment area regardless of potential to emit (PTE). However, given that such a partial approval is inconsistent with the notion that partial approvals should relate to logically separable portions of a given submittal, we will treat the BACT requirement in article 13.1.3(3) for the purposes of the analysis herein as if it applies only to sources that are 100 tons per year or larger. See Bethlehem Steel Corp

. v. Gorsuch , 742 F.2d 1028 (7th Cir. 1984)(holding the CAA’s partial approval provision did not allow EPA to make a SIP stricter).57 First, we note that BACT is not required under CAA section 110 or EPA’s SIP regulations for a new source or modification (in attainment areas) that is not considered a “major stationary source” or a “major modification” as defined under EPA’s prevention of significant deterioration (PSD) regulations such as those promulgated at 40 CFR 52.21. 8 The major stationary source threshold under EPA’s PSD regulations is generally 250 tons per year or more of any regulated air pollutant (not including nonattainment pollutants to which other regulations apply) but a lower threshold (100 tons per year) is established for certain categories of new sources. Thus, the State’s adoption of a BACT requirement in the SIP for all new sources with PTE of 100 tons per year or more was more stringent than required.

Second, rescission of article 13.1.3(3) would not eliminate BACT limits already established in permits for existing sources but would only have a prospective effect.

Third, acting prospectively, rescission of article 13.1.3(3) would not eliminate the BACT requirement for all new sources in attainment areas under NDEP jurisdiction, but only those new sources with PTEs greater than 100 tons per year, and less than 250 tons per year, which are not among the 28 specific categories listed in 40 CFR 52.21(b)(1). The major stationary source threshold for sources among the 28 specific categories listed in 40 CFR 52.21(b)(1) is 100 tons per year. Thus, many of the larger stationary sources and modifications would continue to be subject to the BACT requirement. For sources that otherwise would have been required to meet the BACT requirement under NAQR 13.1.3(3) but are not subject to 40 CFR 52.21, rescission of NAQR article 13.1.3(3) would eliminate the BACT requirement. Such sources would, however, continue to be subject to other SIP limits, NSPS, or MACT standards, as applicable.

Lastly, we find no evidence that NDEP is relying on the BACT requirement in NAQR article 13.1.3(3) to maintain the NAAQS in any area, and recognize that, under the CAA, States are to play

8 We note that 40 CFR 52.21 has been made a part of the Nevada SIP except for that portion applicable to the Clark County Department of Air Quality and Environmental Management. See 40 CFR 52.1485. EPA has delegated (in part) authority to NDEP to administer the PSD permitting program (set forth in 40 CFR 52.21). See 68 FR 52837 (September 8, 2003). Thus, NDEP and EPA share responsibility for pre-construction review of new major sources or major
modifications under 40 CFR 52.21.58 the primary role in pollution control and that States retain the maximum possible flexibility to balance environmental and economic concerns in designing SIPs so long as such plans attain and maintain the NAAQS and meet all applicable requirements. Rescission of the BACT requirement in NAQR article 13.1.3(3) may well result in the consumption of PSD increment at a faster rate than otherwise would occur, but the NDEP has the ability to account for such effects through PSD increment tracking of major sources and modifications and has the authority to remedy any increment violation that may occur

as a result.

Therefore, in light of the above, we conclude that rescission of NAQR article 13.1.3(3) would not interfere with attainment or maintenance of the NAAQS or any other applicable requirement of the Act, and thus, we may approve the State’s request for rescission of this article consistent with CAA section 110(l).
**RECOMMENDATION: APPROVE REQUEST FOR RESCISSION.**

NAC 445.706(2) - Application date: payment of fees , submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626). This existing SIP rule establishes that all permit fees must be paid to the State of Nevada or the local agency which certified issuance of the certificate or permit and are not refundable. CAA section 110(a)(2)(L) requires SIPs to require the owner or operator of each major stationary source to pay to the permitting authority, as a condition of any permit required under the Act, a fee sufficient to cover the reasonable costs of reviewing and acting upon any application for such a permit, and if the owner or operator receives a permit for such source, the reasonable costs of implementing and enforcing the terms and conditions of any such permit, until such fee requirement is superseded with respect to such sources by EPA’s approval of a fee program under title V of the Act. EPA approved NDEP’s title V program on an interim basis effective on January 11, 1996 (see 60 FR 63631, December 12, 1995) and then fully approved an amended program effective on November 30, 2001 (see 66 FR 63188, December 5, 2001). NDEP’s title V program includes a fee program (in NAC 445B.327) that meets EPA requirements fortitle V programs. Thus, NAC 445.706(2), which is a permit-feerelated rule in an area that has an approved title V program, is no longer necessary to meet the requirements of CAA section 110(k)(2)(L) and may be rescinded. **RECOMMENDATION: APPROVE REQUEST FOR RESCISSION.** 

NAC 445.715 - Operation permits: revocation , submitted on October 26, 1982 and approved on March 27, 1984 (49 FR 11626).59 In subsections (1) and (2), NAC 445.715 allows an operating permit to be revoked if the control equipment is not operating, or if NDEP determines that there has been a violation of any State air pollution regulation, NSPS or NESHAPs. This rule also provides that revocation is effective 10 days after service unless a hearing is requested (see subsection (3) of the rule) and provides for a $100 fee for reissuance (see subsection (4) of the rule).

In substance, the provisions of subsections (1) and (2) of the existing SIP rule are contained in submitted rule NAC 445B.325 (“Operating permits: Termination, reopening and revision, revision, or revocation and reissuance”), and the procedural protections provided in subsection (3) are generally provided in NRS 445B.340, which we have proposed to approve into the Nevada SIP (see 71 FR 50875 (August 28, 2006), and the fee provision in subsection (4) is no longer necessary [see above discussion of NAC 445.706(2) (“Application date: payment of fees”)]. However, because this TSD recommends disapproval of submitted rule NAC 445B.325, as part of the disapproval of the set of rules that comprise NDEP’s stationary source permitting program (i.e., excluding parts C and D of title I of the Act), we must also recommend that the State’s request for rescission of NAC 445.715 be disapproved. Upon eventual approval of NAC 445B.325, we can approve rescission of NAC 445.715.
**RECOMMENDATION: DISAPPROVE REQUEST FOR RESCISSION.**

NRS 704.820 to 704.900 Construction of Utility Facilities: Utility Environmental Protection Act , submitted on October 13, 1980 and approved on April 13, 1982 (47 FR 15790). Our April 1982 notice indicates that this statutory provision (and Rule 25 of General Order No. 3, discussed above ) were submitted to satisfy one of the conditions of approval for the Las Vegas CO and ozone nonattainment plans under part D of the CAAA of 1977. See 46 FR 21758 (April 14, 1981) (“(iii) By August 12, 1981, the State must submit regulations for the review and permitting of fossil fuel-fired electric steam generators.”)

Specifically, our April 1982 notice indicates that the statutory provisions and rule were submitted to address the provisions of section 172(b)(11)(A) of the 1977 Amended Act. Section 172(b)(11)(A) requires that, for areas (like Las Vegas Valley) that demonstrate the need to extend the attainment date for ozone or CO from 1982 to 1987, States establish a program which requires, prior to issuance of any permit for construction or modification of a major emitting facility, an analysis of alternative sites, sizes, production processes, and60 environmental control techniques for such proposed source which demonstrates that benefits of the proposed source significant outweigh the environmental and social costs imposed as a result of its location, construction, or modification. See, also, our NPRM at 45 FR 59334, at 59338 (September 9, 1980).

**RECOMMENDATION: DEFER TO FUTURE RULEMAKING ON NONATTAINMENT NSR**

**RULES.**

VII. ATTACHMENTS

A. SUBMITTED NDEP RULES

B. SIP NDEP RULES