59582 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 51 

[AD–FRL–7981–1; E–Docket ID No. OAR– 

2004–0013 (Legacy Docket No. A–87–16)] 

RIN–2060–AM33 

Prevention of Significant Deterioration 

for Nitrogen Oxides 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Final rule. 

SUMMARY: In today’s final action, EPA is 

retaining the existing nitrogen dioxide 

(NO2) increments as part of the Agency’s 

regulations for the Prevention of 

Significant Deterioration (PSD) of air 

quality from emissions of nitrogen 

oxides (NOX). These regulations are 

designed to preserve the air quality in 

national parks and other areas that are 

meeting the national ambient air quality 

standards (NAAQS) for NO2 (hereafter 

called the NO2 NAAQS). EPA 

reevaluated the original NO2 increments 

in response to a 1990 court ruling that 

directed the Agency to consider and 

harmonize the statutory criteria for 

establishing PSD regulations for NOX

contained in sections 166(c) and 166(d) 

of the Clean Air Act (CAA or Act). EPA 

is also amending its PSD regulations to 

clarify that States otherwise meeting 

these requirements of the Act may 

obtain approval to employ alternative 

approaches to the existing increments 

for NO2. Under a separate action, we 

will be publishing a Supplemental 

Notice of Proposed Rulemaking (SNPR) 

to show how implementation of the 

model cap and trade program under the 

2005 Clean Air Interstate Rule (CAIR) 

can meet the requirements for a State to 

use this approach in lieu of the existing 

NO2 increments in order to prevent 

significant deterioration of air quality 

from emissions of NOX. 

DATES: This final rule is effective on 

November 14, 2005. 

ADDRESSES: EPA has established a 

docket for this action under Docket ID 

No. OAR–2004–0013. All documents in 

the docket are listed in the EDOCKET 

index at http://www.epa.gov/edocket. 

Although listed in the index, some 

information may not be publicly 

available, i.e., CBI or other information 

whose disclosure is restricted by statute. 

Certain other material, such as 

copyrighted material, is not placed on 

the Internet and will be publicly 

available only in hard copy form. 

Publicly available docket materials are 

available either electronically in 

EDOCKET or in hard copy at the Air 

Docket, EPA/DC, EPA West, Room 

B102, 1301 Constitution Ave., NW., 

Washington, DC. The Public Reading 

Room is open from 8:30 a.m. to 4:30 

p.m., Monday through Friday, excluding 

legal holidays. The telephone number 

for the Public Reading Room is (202) 

566–1744, and the telephone number for 

the Air Docket is (202) 566–1742. 

FOR FURTHER INFORMATION CONTACT: Mr. 

Dan deRoeck, Information Transfer and 

Program Integration Division (C339–03), 

U.S. Environmental Protection Agency, 

Research Triangle Park, NC 27711, 

telephone (919) 541–5593, fax (919) 

541–5509, or e-mail at 

deroeck.dan@epa.gov. 

SUPPLEMENTARY INFORMATION: 

I. General Information 

A. Does This Action Apply to Me? 

Entities affected by this rule include 

sources in all industry groups. The 

majority of sources potentially affected 

are expected to be in the following 

groups: 

Industry group SIC a NAICSb

Electric Services ................................................................................................................................... 491 221111, 221112, 221113, 

221119, 221121, 221122 

Petroleum Refining ............................................................................................................................... 291 324110 

Industrial Inorganic Chemicals .............................................................................................................. 281 325181, 325120, 325131, 

325182, 211112, 325998, 

331311, 325188 

Industrial Organic Chemicals ................................................................................................................ 286 325110, 325132, 325192, 

325188, 325193, 325120, 

325199 

Miscellaneous Chemical Products ........................................................................................................ 289 325520, 325920, 325910, 

325182, 325510 

Natural Gas Liquids .............................................................................................................................. 132 211112 

Natural Gas Transport .......................................................................................................................... 492 486210, 221210 

Pulp and Paper Mills ............................................................................................................................. 261 322110, 322121, 322122, 

322130 

Paper Mills ............................................................................................................................................ 262 322121, 322122 

Automobile Manufacturing .................................................................................................................... 371 336111, 336112, 336211, 

336992, 336322, 336312, 

336330, 336340, 336350, 

336399, 336212, 336213 

Pharmaceuticals .................................................................................................................................... 283 325411, 325412, 325413, 

325414 

aStandard Industrial Classification. 

b North American Industry Classification System. 

Entities affected by the rule also 

include States, local permitting 

authorities, and Indian tribes whose 

lands contain new and modified major 

stationary sources. 

B. Where Can I Obtain Additional 

Information? 

In addition to being available in the 

docket, an electronic copy of today’s 

final rule is also available on the World 

Wide Web. Following signature by the 

EPA Administrator, a copy of today’s 

final rule will be posted on the EPA’s 

New Source Review (NSR) Web site, 

under Regulations & Standards, at 

http://www.epa.gov/nsr/index.html. 

C. How is This Preamble Organized? 

The information presented in this 

preamble is organized as follows: 

I. General Information 

A. Does This Action Apply to Me? 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59583 

B. Where Can I Obtain Additional 

Information? 

C. How Is This Preamble Organized? 

II. Background 

A. PSD Program 

B. Existing PSD Increment System for NOX

C. SIP Requirements for Implementing PSD 

Program 

D. Court Challenge to Increments for NOX

III. Overview of Today’s Final Action 

A. What We Proposed 

B. Final Action and Differences From 

Proposal 

IV. Legal Basis for Final Action 

A. Clean Air Act Provisions and Court 

Opinion 

1. Applicable Statutory Provisions 

2. Opinion of the Court in EDF v. EPA 

B. EPA’s Interpretation of Section 166 of 

the Act 

1. Regulations As a Whole Should Fulfill 

Statutory Requirements 

2. Contingent Safe Harbor Approach 

3. The Statutory Factors Applicable Under 

Section 166(c) 

4. Balancing the Factors Applicable Under 

Section 166(c) 

5. Authority for States To Adopt 

Alternatives To Increment 

V. Health and Welfare Effects of NOX

A. Overview of the Potential Effects of 

Nitrogen Oxides 

B. Scope of Our Analysis 

C. Data Considered in Our Analysis 

D. Analysis of Potential Effects 

1. Health Effects 

2. Welfare Effects 

VI. Final Actions 

A. Retain Existing Increment System for 

NOX

1. Existing Characteristics of the Regulatory 

Scheme Fulfill Statutory Criteria 

2. Characteristics of Increments for NOX

B. State Option To Employ Alternatives To 

Increment 

1. States May Adopt ‘‘Other Measures’’

That Fulfill Section 166 of the Act 

2. EPA Is Not Adopting Elements of Option 

3 

3. Benefits of an Alternative Approach 

4. Future Actions Regarding Alternatives 

VII. Measures Not Proposed as Options 

VIII. Statutory and Executive Order Reviews 

A. Executive Order 12866—Regulatory 

Planning and Review 

B. Paperwork Reduction Act 

C. Regulatory Flexibility Act (RFA) 

D. Unfunded Mandates Reform Act 

E. Executive Order 13132—Federalism 

F. Executive Order 13175—Consultation 

and Coordination With Indian Tribal 

Governments 

G. Executive Order 13045—Protection of 

Children From Environmental Health 

and Safety Risks 

H. Executive Order 13211—Actions That 

Significantly Affect Energy Supply, 

Distribution, or Use 

I. National Technology Transfer and 

Advancement Act 

J. Executive Order 12898—Federal Actions 

To Address Environmental Justice in 

Minority Populations and Low-income 

Populations 

K. Congressional Review Act 

II. Background 

A. PSD Program 

Part C of title I of the Act contains the 

requirements for a component of the 

major new source review (NSR) program 

known as the Prevention of Significant 

Deterioration (PSD) program. This 

program sets forth procedures for the 

preconstruction review and permitting 

of new and modified major stationary 

sources of air pollution locating in areas 

meeting the NAAQS, i.e., ‘‘attainment’’

areas, or in areas for which there is 

insufficient information to classify an 

area as either attainment or 

nonattainment, i.e., ‘‘unclassifiable’’

areas. 

The applicability of the PSD program 

to a particular source must be 

determined in advance of construction 

and is pollutant-specific. Once a source 

is determined to be subject to PSD, it 

must undertake a series of analyses to 

demonstrate that it will use the best 

available control technology (BACT) 

and will not cause or contribute to a 

violation of any NAAQS or incremental 

ambient pollutant concentration 

increase. In cases where the source’s 

emissions may adversely affect an area 

classified as a Class I area, additional 

review is conducted to protect the 

increments and special attributes of 

such an area defined as ‘‘air quality 

related values’’ (AQRV). 

When the permitting authority 

reaches a preliminary decision to 

authorize construction of each proposed 

major new source or major modification, 

it must provide notice of the 

preliminary decision and an 

opportunity for comment by the general 

public, industry, and other persons that 

may be affected by the major source or 

major modification. After considering 

and responding to the comments, the 

permitting authority may issue a final 

determination on the construction 

permit in accordance with the PSD 

regulations. 

B. Existing PSD Increment System for 

NOX

On October 17, 1988, EPA 

promulgated pollutant-specific PSD 

regulations for NOX under section 166 

of the CAA. 53 FR 40656. As part of 

these regulations, the EPA decided to 

establish NO2 increments following the 

pattern enacted by Congress for the 

particulate matter (PM) and sulfur 

dioxide (SO2) increments. These 

increments establish maximum 

increases in ambient air concentrations 

of NO2 (expressed in micrograms per 

cubic meter (μg/m3)) allowed in a PSD 

area over a baseline concentration. 

Emissions increases from both 

stationary and mobile sources are 

considered in the consumption of the 

NO2 increments which are implemented 

through the PSD permitting provisions 

in 40 CFR parts 51 and 52. 

The NO2 increment system includes 

the three-tiered area classification 

system originally established by 

Congress in section 163 for the statutory 

increments for SO2 and PM. Congress 

designated Class I areas (including 

certain national parks and wilderness 

areas) as areas of special national 

concern, where the need to prevent air 

quality deterioration is the greatest. 

Consequently, the allowable level of 

incremental change in air quality is 

smallest, i.e., most stringent, in Class I 

areas. Congress initially established as 

Class II all areas not specifically 

designated in the Act as Class I areas. 

The increments of Class II areas are less 

stringent than those of the Class I areas 

and allow for a moderate degree of 

emissions growth. For future 

redesignation purposes, Congress 

defined as Class III any existing Class II 

area for which a State may desire to 

promote higher levels of industrial 

development (and emissions growth). 

Thus, Class III areas are allowed to have 

the greatest amount of pollutant 

increase while still achieving the 

NAAQS. There have been no Class III 

redesignations to date. 

EPA based the levels of the original 

NO2 increments for the three area 

classifications on the percentage-ofNAAQS approach that Congress used to 

define the increments in the Act for SO2

and PM. Congress used different 

percentages of the NAAQS to calculate 

the Class I increments for PM and SO2. 

For the NO2 increments, we chose the 

percentage that Congress used for SO2. 

This decision yielded a lower numerical 

value for the Class I NO2 increment than 

would have resulted by using the PM 

percentages. 

The existing Class I NO2 increment is 

2.5 μg/m3 (annual average), a level of 2.5 

percent of the NO2 NAAQS. It is based 

on the Class I SO2 increment, which is 

set at the same percentage (2.5 percent) 

of the SO2 annual NAAQS. The Class II 

NO2 increment is 25 μg/m3 ¥ 25 

percent of the NO2 NAAQS. The Class 

III NO2 increment is 50 μg/m3 ¥ 50 

percent of the NO2 NAAQS. 

C. SIP Requirements for Implementing 

PSD Program 

Air quality planning requirements for 

new and modified stationary sources of 

air pollution are an integral part of the 

PSD program. States must develop, 

adopt, and submit to EPA for approval 

a State Implementation Plan (SIP) that 

contains emission limitations and other 

59584 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

control measures to attain and maintain 

the NAAQS and to meet other 

requirements of section 110(a) of the 

Act. Each SIP must contain a 

preconstruction review program for the 

construction and modification of any 

stationary source of air pollution to 

assure that the NAAQS are achieved 

and maintained. Further, each SIP must: 

protect areas of clean air; not interfere 

with any other State’s NAAQS 

maintenance; protect AQRVs, including 

visibility, in national parks and other 

natural areas of special concern; assure 

that appropriate emissions controls are 

applied; maximize opportunities for 

economic development consistent with 

the preservation of clean air resources; 

and ensure that any decision to increase 

air pollution is made only after full 

public consideration of all the 

consequences of such a decision. 

D. Court Challenge to Increments for 

NOX

EPA’s original NO2 increments were 

challenged in 1988 by the 

Environmental Defense Fund (now 

Environmental Defense, or ‘‘ED’’) when 

ED filed suit in the U.S. Court of 

Appeals for the District of Columbia 

Circuit against the Administrator 

(Environmental Defense Fund, Inc. v. 

Reilly, No. 88–1882). ED successfully 

argued that EPA failed to sufficiently 

consider certain provisions in section 

166 of the CAA. The court remanded the 

case to EPA ‘‘to develop an 

interpretation of section 166 that 

considers both subsections (c) and (d), 

and if necessary to take new evidence 

and modify the regulations.’’

Environmental Defense Fund v. EPA, 

898 F.2d 183, 190 (D.C. Cir. 1990) (‘‘EDF 

v. EPA’’). EPA initiated this action in 

response to the court decision. We 

discuss the opinion of the court further 

below. 

III. Overview of Today’s Final Action 

To ensure protection of the air quality 

in national parks and other areas that 

meet the NAAQS for NO2, EPA is taking 

final action today on its reevaluation of 

the Agency’s pollutant-specific PSD 

regulations for NOX, which include the 

existing NO2 increments. We have 

decided to retain the existing NO2

increments while also granting States 

the option to seek approval of 

alternative approaches that protect 

parks and prevent significant 

deterioration of air quality from 

emissions of NOX. 

A. What We Proposed 

In accordance with the directions of a 

1990 court ruling, EPA conducted a 

review of the existing NO2 increments 

that are part of the Agency’s pollutantspecific PSD regulations for NOX. We 

considered and harmonized the 

statutory criteria, contained in sections 

166(c) and 166(d) of the Act, that govern 

the content of these PSD regulations for 

NOX. EPA proposed to apply the 

statutory criteria using the ‘‘contingent 

safe harbor’’ approach that was 

suggested by the court as an appropriate 

way to ensure that EPA’s PSD 

regulations for NOX will prevent 

significant deterioration of air quality in 

parks and other areas that are 

designated to be in attainment with the 

NAAQS or are unclassifiable. Applying 

this legal interpretation, we proposed 

three options to satisfy the statutory 

requirements. See 70 FR 8880 (Feb. 23, 

2005). 

In the first option (option 1) of our 

February 2005 proposal, EPA proposed 

to retain the existing regulatory 

framework and the original, existing 

increments for NO2 that the Agency first 

promulgated in 1988 to protect the air 

quality in national parks and other areas 

that meet the NAAQS for NO2. These 

increments were established as a 

percentage of the NAAQS, and were 

based on the same ambient measure 

(NO2) and averaging period (annual) as 

the NAAQS. We proposed to find that 

an increment with these characteristics 

satisfied the minimum requirements of 

section 166(d) of the Act for preserving 

the air quality in parks and other 

attainment and unclassifiable areas. In 

addition, to address the requirements of 

section 166(c), we reviewed the existing 

regulatory framework of the Agency’s 

PSD regulations for NOX and the 

scientific and technical information 

pertaining to the health, welfare, and 

ecological effects of NOX. In light of this 

review, EPA proposed to find that the 

statutory requirements were met by 

retaining annual NO2 increments that 

are based on the percentages of the 

NAAQS that Congress employed to set 

the increments for SO2. The available 

research on health and welfare effects 

indicated that the existing NO2

increments, in conjunction with the 

case-by-case permit reviews for 

additional impacts and impairment of 

AQRVs, fulfilled the criteria in section 

166(c). 

In the second option (option 2), we 

proposed to allow States to prevent 

significant deterioration of air quality 

due to emissions of NOX by adopting an 

EPA-administered market-based 

interstate cap and trade program, such 

as the model cap and trade program for 

EGUs contained in our CAIR. Under this 

option, a State that implemented this 

program to address NOX emissions 

would no longer be required to conduct 

certain source-specific analyses, 

including the current NO2 increment 

analysis. This option would require 

States to submit revised SIPs that 

include a cap and trade program to 

reduce NOX emissions in accordance 

with statewide emissions budgets 

prescribed by EPA. Neither the 

statewide budget nor the regional cap 

would be a legally enforceable limit on 

total NOX emissions but would be used 

as an accounting technique to determine 

the amount of emissions reductions that 

would be needed from specific source 

categories to satisfy the budget or cap. 

The requirements of the cap and trade 

program would be enforceable, and this 

would ensure that as long as emissions 

from sources outside of the cap did not 

grow more than projected, the overall 

regionwide budget would be met. 

As a third option (option 3), we 

proposed to allow States to adopt their 

own planning strategies to meet the 

requirements of section 166 of the CAA. 

We proposed to allow a State to forego 

implementation of the NO2 increments 

if the State could demonstrate that 

measures in its SIP, in conjunction with 

Federal requirements, would prevent 

significant deterioration of air quality 

from emissions of NOX. Under this 

option, in lieu of implementing the 

increment system for NOX, a State 

would have to demonstrate that specific 

planning goals and requirements 

contained in its SIP would satisfy the 

requirements in section 166 of the Act 

and the goals and purposes of the PSD 

program set forth in section 160. We 

proposed to require that States establish 

a clear planning goal that satisfied the 

requirements of sections 166(c) and 

166(d) of the Act. Under this option, 

EPA did not propose to require a State 

to demonstrate that its SIP included a 

specific type of program. However, we 

indicated that we believed a goal to 

keep statewide emissions of NOX from 

all sources below 1990 levels would 

prevent significant deterioration of air 

quality and satisfy the requirements of 

section 166 of the Act. 

B. Final Action and Differences From 

Proposal 

In this final action, we are adopting 

option 1 of the February 2005 proposal 

and retaining the existing NO2

increments along with other parts of the 

existing framework of pollutant-specific 

PSD regulations for NOX. However, we 

are also amending the text of one of our 

PSD regulations in order to make clear 

that States may seek EPA approval of 

SIPs that utilize an alternative approach 

to the NO2 increments if the State can 

demonstrate that an alternative program 

satisfies the requirements of sections 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59585 

166(c) and 166(d) of the CAA and 

prevents significant deterioration from 

emissions of NOX. States have always 

had the option to submit alternative 

approaches in their SIPs that can be 

shown to be more effective than the 

minimum program elements established 

by EPA, but this regulatory change is 

intended to clarify that a system other 

than increments may be utilized by a 

State to prevent significant deterioration 

from emissions of NOX where the 

requirements of the CAA are otherwise 

met. 

In options 2 and 3, we proposed to 

address the requirements of section 166 

of the CAA for NOX through the review 

and approval of State programs that 

employed alternative approaches to 

fulfill the requirements of sections 

166(c) and 166(d) of the Act. We are 

codifying this basic principle in our 

regulations today without defining any 

specific type of alternative program that 

we believe would meet these 

requirements. We are simply making 

clear in our regulations that States have 

the option to continue implementing the 

NO2 increment program or to design an 

alternative approach as part of the SIPs 

and submit this program to EPA for 

approval. Rather than promulgating a 

specific alternative program of the type 

we proposed in option 2 and option 3, 

we are allowing States the flexibility to 

submit any type of alternative for 

consideration on a case-by-case basis to 

determine if the alternative meets the 

requirements of sections 166(c) and 

166(d) of the CAA as we interpret these 

provisions in this final action. We are 

not establishing any additional 

regulatory criteria (such as planning 

goals or emissions inventory 

requirements) that would govern the 

review of such a program other than 

what is already contained within the 

CAA. Thus, we make no final finding at 

this time that any particular type of 

program other than the existing 

increment framework meets the 

requirements of sections 166(c) and 

166(d) of the CAA. Instead, we plan to 

make such determinations on a case-bycase basis whenever a State submits an 

alternative approach for EPA to approve 

as part of a SIP. 

Although we are not adopting a 

specific cap and trade (option 2) or 

emissions inventory-based planning 

program (option 3) at this time, we 

continue to see promise in using a cap 

and trade approach modeled on the 

CAIR to meet the goals of the PSD 

program for NOX. As a result, we intend 

to publish a supplemental notice of 

proposed rulemaking that builds on 

option 2 and provides more details on 

how a State that achieves the NOX

emissions reductions required under 

CAIR can fulfill the objectives of the 

PSD program, satisfy the statutory 

requirements of section 166 of the Act, 

and obviate the need to implement the 

NO2 increments program. 

IV. Legal Basis for Final Action 

A. Clean Air Act Provisions and Court 

Opinion 

1. Applicable Statutory Provisions 

EPA is taking this action in 

accordance with the requirements of 

section 166 of the CAA for NOX. In 

section 166(a) of the Act, Congress 

directed EPA to conduct a study and 

promulgate regulations to prevent 

significant deterioration of air quality 

which would result from emission of 

hydrocarbons, carbon monoxide, 

photochemical oxidants, and NOX. 

Congress further specified that such 

regulations meet the following 

requirements set forth in sections 166(c) 

and 166(d): 

(c) Such regulations shall provide specific 

numerical measures against which permit 

applications may be evaluated, a framework 

for stimulating improved control technology, 

protection of air quality values, and fulfill the 

goals and purposes set forth in section 101 

and section 160. 

(d) The regulations * * * shall provide 

specific measures at least as effective as the 

increments established in section 163 [for 

SO2 and PM] to fulfill such goals and 

purposes, and may contain air quality 

increments, emission density requirements, 

or other measures. 

The goals and purposes of the PSD 

program set forth in section 160 are as 

follows: 

(1) to protect public health and welfare 

from any actual or potential adverse effect 

which in the Administrator’s judgment may 

reasonably be anticipate[d] to occur from air 

pollution or from exposures to pollutants in 

other media, which pollutants originate as 

emissions to the ambient air, 

notwithstanding attainment and maintenance 

of all national ambient air quality standards; 

(2) to preserve, protect, and enhance the air 

quality in national parks, national wilderness 

areas, national monuments, national 

seashores, and other areas of special national 

or regional natural, recreational, scenic, or 

historic value; 

(3) to insure that economic growth will 

occur in a manner consistent with the 

preservation of existing clean air resources; 

(4) to assure that emissions from any 

source in any State will not interfere with 

any portion of the applicable implementation 

plan to prevent significant deterioration of air 

quality for any other State; and 

(5) to assure that any decision to permit 

increased air pollution in any area to which 

this section applies is made only after careful 

evaluation of all the consequences of such a 

decision and after adequate procedural 

opportunities for informed public 

participation in the decisionmaking process. 

In addition, the goals and purposes of 

the CAA described in section 101 of the 

Act are the following: 

(b) * * * (1) to protect and enhance the 

quality of the Nation’s air resources so as to 

promote the public health and welfare and 

the productive capacity of its population; 

(2) to initiate and accelerate a national 

research and development program to 

achieve the prevention and control of air 

pollution; 

(3) to provide technical and financial 

assistance to State and local governments in 

connection with the development and 

execution of their air pollution prevention 

and control programs; and 

(4) to encourage and assist the 

development and operation of regional air 

pollution prevention and control programs [; 

and] 

(c) * * * to encourage or otherwise 

promote reasonable Federal, State, and local 

governmental actions, consistent with the 

provisions of this Act, for pollution 

prevention. 

2. Opinion of the Court in EDF v. EPA 

In its 1990 opinion on the challenge 

to EPA’s 1988 regulations for NOX, the 

court held that EPA had satisfied its 

obligation under section 166(d) but had 

not sufficiently considered whether 

different increments should be 

established under the criteria in section 

166(c). 

Environmental Defense Fund v. EPA, 

898 F.2d 183 (D.C. Cir. 1990) (‘‘EDF v. 

EPA’’). More specifically, the court held 

that EPA’s percentage-of-NAAQS 

approach for determining the 

increments satisfied the duty under 

section 166(d) to promulgate regulations 

for NOX that were ‘‘at least as effective’’

as the increments in section 163. Id. at 

188. As to subsection (c), however, the 

court held that EPA’s approach of using 

the percentage ambient concentrations 

as a ‘‘proxy’’ for meeting the subsection 

(c) criteria overlooked the language of 

subsection (c) and turned subsection (c) 

into an option despite its mandatory 

wording. Thus, the court remanded the 

case to EPA ‘‘to develop an 

interpretation of section 166 that 

considers both subsections (c) and (d), 

and if necessary to take new evidence 

and modify the regulations.’’ Id. at 190. 

The court identified three steps that 

EPA took to develop PSD regulations for 

NOX under section 166. The first two 

steps reflected EPA’s decisions to 

implement the PSD program for NOX by 

adopting regulations for NOX that 

employed increments with an area 

classification system. These first two 

steps were not controverted in EDF v. 

EPA. See 898 F.2d at 184–85. The 

dispute in the EDF case involved only 

59586 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

the third step, which was EPA’s action 

to establish several characteristics of the 

increments by reference to the NAAQS. 

The characteristics that EPA derived 

from the NAAQS were (1) the level of 

the increments using the percent-ofNAAQS approach; (2) the time period 

(annual average) for the increments; and 

(3) the pollutant (NO2) for which the 

increments were established. Since 

these three characteristics of the 

increments were the only issues 

controverted in the EDF v. EPA case, 

EPA interprets the court’s remand to 

direct the Agency only to reconsider 

these three questions. However, in the 

proposal, we also believed it would be 

beneficial to consider alternative 

approaches to an increment system and 

voluntarily reconsidered the first two 

steps in the process of developing 

pollutant-specific PSD regulations for 

NOX. 

In EDF v. EPA, the court held that, in 

light of the criteria in section 166(c), 

EPA could not use the NAAQS as the 

sole basis for deriving increments. 

However, the court held that using the 

NAAQS as the basis for deriving 

increments was permissible in 

determining whether the ‘‘at least as 

effective’’ standard under subsection (d) 

was met. But, with respect to subsection 

(c), the court stated: ‘‘We find nothing 

in the language or legislative history 

suggesting that this duty [consideration 

of the goals and purposes of the statute] 

could be satisfied simply by referencing 

the NAAQS.’’ Id. at 190. The court 

noted the differences between the health 

and welfare criteria on which the 

NAAQS are based (sections 108 and 

109) and the ‘‘goals and purposes’’ of 

the PSD program set forth in section 

160, highlighting the special value the 

PSD program places on protection of 

national parks. At the same time, the 

court recognized that ‘‘[n]evertheless, 

the ambient standards are the basic 

measure of air quality under the [Clean 

Air Act], and the controlling standards 

by no means exclude any value that is 

the subject of focus under the PSD 

provisions.’’ Id. at 176 (internal citations 

and quotations omitted). In other words, 

the court observed that NAAQS remain 

relevant to the inquiry under section 

166 because they are a basic measure of 

air quality and may indirectly reflect 

some consideration, among others, of 

the same values that are the focus of the 

PSD program. However, the court 

indicated that we could not rely solely 

upon the NAAQS to comply with 

section 166 because this provision 

directs us to focus on the specific goals 

and purposes of PSD which are not 

necessarily the factors that determine 

the NAAQS under section 109. 

Thus, the court directed EPA to 

reconsider the characteristics of the 

existing increments in light of the 

criteria in both sections 166(c) and 

166(d). The court indicated that one 

permissible interpretation for 

harmonizing subsections (c) and (d) 

would be to construe subsection (d) as 

a ‘‘contingent safe harbor’’ or 

presumptive baseline. Thus, increments 

derived from the NAAQS could be 

authorized if the Agency were to 

undertake additional analysis and make 

a reasoned determination that the 

criteria under subsection (c) do not call 

for different increments than the ‘‘safe 

harbor’’ that meets the criteria in 

subsection (d) of the statute. 

B. EPA’s Interpretation of Section 166 of 

the Act 

In the February 2005 notice of 

proposed rulemaking (February 2005 

proposal), we responded to the court’s 

opinion by describing in detail how the 

EPA proposed to interpret and apply the 

relevant provisions of the CAA in the 

course of reevaluating the existing PSD 

regulations for NOX on remand. 70 FR 

at 8885–88. Our interpretation is 

grounded on five central elements. First, 

we read section 166 of the Act to direct 

EPA to conduct a holistic analysis that 

considers how a complete system of 

regulations will collectively satisfy the 

applicable criteria, rather than 

evaluating one individual part of a 

regulatory scheme in isolation. Second, 

we adopted the ‘‘contingent safe harbor’’

approach suggested by the court which 

calls for EPA to first establish the 

minimum level of effectiveness 

necessary to satisfy section 166(d) and 

then to conduct further analysis to 

determine if additional measures are 

necessary to fulfill the requirements of 

section 166(c). Third, we interpreted 

section 166(c) of the Act to identify 

eight statutory factors that EPA must 

apply when promulgating pollutantspecific regulations to prevent 

significant deterioration of air quality. 

Fourth, we interpreted the requirements 

to simultaneously satisfy each of these 

factors to establish a balancing test in 

cases where certain objectives may be at 

odds with each other. Fifth, we 

recognized that the requirements of 

section 166 may be satisfied by adopting 

other measures besides an increment 

and that EPA may allow States to 

demonstrate that alternatives to 

increment contained in a SIP meet the 

requirements of sections 166(c) and 

166(d). 

We maintain this interpretation in 

this final action and summarize the 

main points below. Further discussion 

of many of these points can be found in 

the February 2005 proposal. 70 FR at 

8885. In addition to reiterating the main 

points below, the following discussion 

also clarifies our interpretation in light 

of several comments that we received. 

1. Regulations As a Whole Should 

Fulfill Statutory Requirements 

Commenters did not question our 

holistic approach, which is grounded on 

the structure of section 166 of the Act. 

Section 166(a) directs EPA to develop 

pollutant-specific regulations to prevent 

the significant deterioration of air 

quality. Sections 166(c) and 166(d) 

provide detail on the contents of those 

regulations. In order to develop 

pollutant-specific regulations under 

subsection (a), EPA must establish an 

overall regulatory framework for those 

regulations and fill in specific details 

around that framework. Thus, EPA 

interprets section 166 to require that the 

entire system of PSD regulations for a 

particular pollutant must, as a whole, 

satisfy the criteria in sections 166(c) and 

166(d). 

As a result, when we reevaluated the 

existing PSD regulations for NOX, we 

did not look at increments in isolation, 

but also considered how these 

increments work in conjunction with 

other measures to satisfy the statutory 

criteria. The other measures that we 

considered with the increments are the 

area classification system, AQRV review 

in Class I areas, additional impacts 

analysis, and BACT requirements. This 

approach is consistent with section 

166(d), which says that pollutantspecific PSD regulations ‘‘may contain’’

increments or ‘‘other measures.’’

In option 1 of the proposal, we 

proposed to retain the increment system 

and focused our reevaluation on the 

specific characteristics of the 

increments (level, time period, and 

pollutant) in our existing PSD 

regulations for NOX. This was because 

the dispute in EDF v. EPA involved only 

EPA’s decisions to define the 

characteristics of the increments for 

NOX in relation to the NAAQS. Since 

the increment and area classification 

system in EPA’s PSD regulations for 

NOX was not controverted, we 

interpreted the court’s opinion not to 

require that the Agency reconsider this 

basic framework for its PSD regulations 

for NOX. Thus, in this action to finalize 

option 1 of the proposal, we continue to 

focus on the level, time period, and 

pollutant employed to establish 

increments for NOX. However, under 

our holistic approach, we considered 

these characteristics of the increment in 

conjunction with the other measures 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59587 

1The Agency’s view is that PSD measures that 

satisfy the specific goals and purposes of section 

160 also satisfy the more general purposes and goals 

identified in section 101 of the Act. The overall 

goals and purposes of the CAA listed in sections 

101(b) and 101(c) are general goals regarding 

protecting and enhancing the nation’s air resources 

and controlling and preventing pollution. Because 

these broad goals are given more specific meaning 

in section 160, EPA does not believe it is necessary 

to consider them in detail when evaluating whether 

PSD regulations satisfy the criteria in section 166(c). 

In addition, the court’s inquiry in EDF v. EPA 

focused exclusively on the specific goals and 

purpose of the PSD program set forth in section 160. 

However, because the broad purpose of the CAA set 

forth in section 101(b)(1) provides some additional 

guidance as to the meaning of the more specific 

PSD goal set forth in section 160(3), we considered 

section 101(b)(1) further in the limited context of 

interpreting one of the factors applicable under 

section 166. 

contained in our PSD regulations for 

NOX that were not challenged in EDF v. 

EPA. 

2. Contingent Safe Harbor Approach 

Our proposal to harmonize the criteria 

set forth in sections 166(c) and 166(d) 

by employing the ‘‘contingent safe 

harbor’’ approach was also not opposed 

by any commenters. Several 

commenters took issue with our 

ultimate decision not to establish 

increments more stringent than the safe 

harbor, but no one questioned the 

analytical approach that we used to 

harmonize sections 166(c) and 166(d) of 

the Act. 

We continue to believe this is an 

appropriate reading of the statute. 

Subsection (c) of section 166 describes 

the kinds of measures to be contained in 

the regulations to prevent significant 

deterioration of air quality called for in 

section 166(a) and specifies that these 

regulations are to ‘‘fulfill the goals and 

purposes’’ set forth in sections 160 and 

101 of the Act. Then, under subsection 

(d), to ‘‘fulfill such goals and purposes,’’

EPA must promulgate ‘‘specific 

measures at least as effective as the 

increments established in section 7473 

of this title [section 163 of the Act].’’ 42 

U.S.C. 7476. Thus, subsection (d) can be 

construed to require that EPA identify a 

minimum level of effectiveness, or safe 

harbor, for the body of pollutant-specific 

PSD regulations adopted under section 

166. Then, subsection (c) may be read to 

require that EPA conduct further review 

to determine whether, based on the 

criteria in subsection (c), EPA’s 

pollutant-specific PSD regulations 

under section 166 should contain 

measures that deviate from the 

minimum ‘‘safe harbor’’ identified 

under subsection (d). As in 1988, we 

construe subsection (d) to require that 

the measures be ‘‘at least as stringent’’

as the statutory increments set forth in 

section 163. 

When we employ an increment and 

area classification system in our section 

166 PSD regulations, we interpret this 

language to require that EPA, at 

minimum, establish increments that are 

consistent with the statutory increments 

established by Congress in section 163 

of the Act. Thus, we identified the ‘‘safe 

harbor’’ increments for NOX for each 

area classification (Class I, II, or III) to 

be increments established in relation to 

the NO2 NAAQS that were set (1) at an 

equivalent percentage of the NAAQS as 

the statutory increments; (2) for the 

same pollutants as the NAAQS; and (3) 

for the same time period as the NAAQS. 

We then conducted further review to 

determine whether these ‘‘safe harbor’’

increments, in conjunction with other 

measures adopted under the PSD 

program and section 166, sufficiently 

fulfilled the criteria in subsection (c). 

After weighing and balancing the 

criteria set forth in subsection (c) (and 

the incorporated goals and purposes of 

the CAA in section 101 and the PSD 

program in section 160), we have 

determined that the ‘‘safe harbor’’

increments and associated measures 

satisfy the criteria in subsection (c) for 

NOX. Thus, we are not adopting 

different increments, additional 

increments, or additional measures to 

satisfy the section 166(c) criteria. 

However, under the contingent safe 

harbor approach, if we had determined 

that the ‘‘safe harbor’’ increments and 

other measures did not satisfy the 

criteria applicable under section 166(c), 

we would have promulgated additional 

increments or other measures as part of 

our pollutant-specific PSD regulations 

for NOX under section 166. 

3. The Statutory Factors Applicable 

Under Section 166(c) 

We proposed to interpret section 

166(c) of the Act to establish eight 

factors to be considered in the 

development of PSD regulations for the 

pollutants covered by this provision. 

These factors are three of the four 

criteria listed in section 166(c) and the 

five goals and purposes identified in 

section 160 of the Act. The three standalone criteria in section 166(c) indicate 

that PSD regulations for specific 

pollutants should provide (1) specific 

numerical measures for evaluating 

permit applications; (2) a framework for 

stimulating improved control 

technology; and (3) protection of air 

quality values. 42 U.S.C. 7476(c). The 

five goals and purposes in section 160 

are incorporated into the analysis by 

virtue of the fourth criterion in section 

166(c), which directs that EPA’s 

pollutant-specific PSD regulations 

‘‘fulfill the goals and purposes’’ set forth 

in sections 160 and 101 of the Act. This 

fourth criterion in section 166(c) cannot 

be understood without reference to 

other parts of the Act. Thus, we 

construed the term ‘‘fulfill the goals and 

purposes,’’ as used in section 166(c), to 

mean that EPA should apply the goals 

and purposes listed in section 160 as 

factors applicable to pollutant-specific 

PSD regulations established under 

section 166. 

A few commenters disagreed with our 

choice of words in an introductory 

paragraph when we collectively 

described these eight parts of the Act as 

‘‘factors to be considered.’’ However, no 

one disagreed that these eight objectives 

should be the focus of our analysis. For 

instance, commenters did not question 

our decision to emphasize the five goals 

and purposes in section 160, while 

looking to the more general goals in 

section 101 of the Act to provide 

guidance on the meaning of the more 

specific goals and purposes of the PSD 

program in section 160.1

In this rulemaking action, we use the 

term ‘‘factors’’ as shorthand to describe 

the group of eight statutory objectives 

(three criteria and five goals and 

purposes) that we believe Congress 

directed us to achieve in promulgating 

pollutant-specific PSD regulations 

under section 166 of the Act. We do not 

intend for our use of ‘‘factors’’ to suggest 

that EPA does not believe it must satisfy 

all four criteria in section 166(c), one of 

which requires that EPA fulfill the five 

goals and purposes in section 160. The 

Agency has used the term ‘‘factors’’ in 

this action to avoid confusion when 

referring to the combination of criteria 

in section 166(c) and goals and purposes 

in section 160 that the court directed us 

to consider further on remand. 

Regardless of the semantics, our 

objective is to establish regulations that 

satisfy each of these factors. 

4. Balancing the Factors Applicable 

Under Section 166(c) 

A few commenters questioned our 

interpretation of the Act to establish a 

balancing test among many of the eight 

factors applicable under section 166(c) 

of the Act. In the proposal, we described 

how we believed the Act directed us to 

balance the goal to promote economic 

growth with the factors that direct us to 

protect: (1) AQRVs; (2) the public health 

and welfare from adverse effects, and (3) 

the air quality in parks and special 

areas. We are not persuaded that this is 

an impermissible reading of the Act. 

Section 166 of the CAA directs EPA to 

promulgate pollutant-specific PSD 

regulations that simultaneously satisfy 

each of the eight factors described 

above. While these objectives are 

59588 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

generally complementary, there are 

circumstances where some of the 

objectives may be in conflict. In these 

situations, some degree of balance or 

accommodation is inherent in the 

requirement to establish regulations that 

satisfy all of these factors at the same 

time. If not, it might be impossible for 

EPA to establish one set of regulations 

that fulfills all the factors applicable 

under section 166(c). 

As discussed in the proposal, we 

believe this balancing test derives 

primarily from the third goal and 

purpose set forth in section 160. Section 

160(3) directs us to ‘‘insure that 

economic growth will occur in a manner 

consistent with the preservation of 

existing clean air resources.’’

To some extent, this goal of the PSD 

program in section 160(3) more 

specifically articulates the broader 

purpose of the CAA, described in 

section 101(b)(1) of the Act, to ‘‘protect 

and enhance the quality of the Nation’s 

air resources so as to promote the public 

health and welfare and the productive 

capacity of its population.’’ 42 U.S.C. 

7401(b)(1). Sections 160(3) and 101(b)(1) 

are similar in that both sections reflect 

the goal to simultaneously protect air 

quality and maximize opportunities for 

economic growth. Thus, in interpreting 

the meaning of section 160(3) when 

used as a factor applicable under section 

166(c), we also consider the broader 

purpose of the Act set forth in section 

101(b)(1). 

The first part of the goal of the PSD 

program set forth in section 160(3) (‘‘to 

insure that economic growth will 

occur’’) makes clear that the PSD 

program is not intended to stifle 

economic growth. However, the second 

part of this goal indicates that economic 

growth should ‘‘occur in a manner that 

is consistent with the preservation of 

existing clean air resources.’’ 42 U.S.C. 

7470(3). Section 101(b)(1) indicates that 

these goals are not necessarily 

inconsistent because Congress sought to 

‘‘protect and enhance the Nation’s air 

resources so as to promote the public 

health and welfare and the productive 

capacity of its population.’’ When 

considered in light of the purpose of the 

Act set forth in section 101(b)(1), it is 

clear that section 160(3) establishes the 

goal of the PSD program to maximize 

opportunities for economic growth and 

to protect clean air resources. Therefore, 

when applied as a guiding factor for the 

content of pollutant-specific PSD 

regulations under section 166(c), we 

construe section 160(3) to require that 

we balance economic growth and 

environmental protection. 

A few commenters objected to our 

characterization of the goal in section 

160(3) as establishing an objective to 

‘‘foster economic growth.’’ According to 

common usage, the term ‘‘foster’’ means 

to ‘‘promote the growth or development 

of.’’ Merriam-Webster’s Collegiate 

Dictionary, Tenth Edition, Page 459 

(2001). We used ‘‘foster’’ in the context 

of describing the goals in sections 160(3) 

and 101(b)(1) of the Act, and considered 

the term to be consistent with the goal 

to ‘‘insure’’ economic growth under 

certain conditions and to ‘‘promote’’ the 

productive capacity of the population 

while protecting air quality. However, to 

be more consistent with our terminology 

in recent NSR rulemaking actions (67 

FR at 80187), we will use the phrase 

‘‘maximize opportunities for economic 

growth’’ in this final action rather than 

‘‘foster economic growth.’’

One commenter also argued that EPA 

was impermissibly departing from an 

earlier interpretation that the goal in 

section 160(3) required EPA ‘‘to ensure 

that economic growth in clean areas 

occurs only after careful deliberation by 

State and local communities.’’ 53 FR 

3698, 3699 (Feb. 8, 1988). However, we 

believe our current view is consistent 

with what we said in that earlier notice 

of proposed rulemaking. In 1988, we 

also recognized that Congress had 

directed us to balance several of the 

goals and purposes listed in section 160 

of the Act. 53 FR at 3699. We stated that 

the PSD program is required to balance 

the first goal to protect public health 

and welfare, the second goal to protect 

air quality in national parks and other 

special areas, and a third goal as 

expressed above. 53 FR at 3699. From 

the language we used, however, it is 

apparent that this ‘‘third goal’’ was 

actually a combination of the goal in 

section 160(3) with the goal in section 

160(5) of the Act. Section 160(5) 

establishes the goal to ‘‘assure that any 

decision to permit increased air 

pollution in any area is made only after 

careful evaluation of all the 

consequences of such decision and after 

adequate opportunities for informed 

public participation in the 

decisionmaking process.’’ 42 U.S.C. 

7470(5). We continue to believe that 

Congress directed us to fulfill both the 

goals in sections 160(3) and 160(5) at 

the same time. However, because, as we 

describe in more detail below, we 

believe that other aspects of our existing 

PSD regulations for NOX fulfill the goal 

in section 160(5), we have not 

emphasized the language of section 

160(5) in the balancing test we utilized 

to analyze the characteristics of the 

increment. 

In the present action, we are carrying 

this balancing approach an additional 

step by seeking to harmonize the goals 

in section 160 with other criteria 

applicable under section 166(c) of the 

Act. Thus, we have not disavowed what 

we said in 1988, but rather have added 

to it. Consistent with the direction of the 

court, we have analyzed the terms of 

sections 166(c) and 160 more carefully 

after the court held that we had not 

adequately considered these provisions 

of the Act. Having considered these 

parts of the statute in more depth at this 

stage, we believe our current 

interpretation is well-grounded in the 

terms of the Act and in fact consistent 

with what we said in 1988. 

The need to balance the applicable 

factors to achieve these objectives 

simultaneously is also supported by our 

interpretation of the second goal in 

section 160(2) of the Act to ‘‘protect 

public health and welfare.’’ The precise 

meaning of this goal in the context of 

the PSD program is somewhat 

ambiguous because it appears to mirror 

the legal standards applicable to the 

promulgation of the primary and 

secondary NAAQS. Under section 

109(b) of the Act, the primary NAAQS 

must ‘‘protect the public health’’ with 

an adequate margin of safety (section 

109(b)(1)) and the secondary NAAQS 

must ‘‘protect the public welfare from 

any known or anticipated adverse 

effects’’ associated with ambient 

concentrations of the pollutant (section 

109(b)(2)). The term ‘‘welfare’’ is 

defined in the Act to include ‘‘effects on 

soils, water, crops, vegetation, manmade materials, animals, wildlife, 

weather, visibility, and climate.’’

Section 302(h) of the Act. 

In the specific context of the PSD 

program, we construe this charge to 

‘‘protect public health and welfare’’ to 

require EPA to evaluate whether adverse 

effects may occur as a result of increases 

in ambient pollutant concentrations to 

levels below the NAAQS. If such effects 

may occur in some areas of the country, 

then EPA must consider how to 

establish PSD regulations that protect 

public health and welfare against those 

effects where they may occur. However, 

we do not interpret the PSD program to 

require regulations that eliminate all 

negative effects that may result from 

increases in pollution in attainment 

areas. 

The PSD program is, as its title 

indicates, designed to prevent 

‘‘significant deterioration’’ from a 

baseline concentration. See S. Rep. 95–

127 at 11 (3 LH at 1385) (‘‘This 

legislation defines ‘significant 

deterioration’ in all clean air areas as a 

specified amount of additional 

pollution * * *. This definition is 

intended to prevent any major decline 

in air quality currently existing in clean 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59589 

2 43 FR 26380, 26381 (June 19, 1978) (‘‘States can 

expand the available PSD increments by requiring 

emissions reductions from existing sources.’’) 

air areas.’’ (emphasis added)). Thus, 

some decline in air quality (relative to 

the baseline air quality concentration) is 

permissible for any particular area of the 

country that is currently achieving the 

NAAQS, as long as it is not 

‘‘significant.’’

When EPA employs an area 

classification system in its section 166 

regulations, these factors must be 

weighed in each type of area (Class I, 

Class II, and Class III). However, the 

weight given to each factor may be more 

or less, depending on the area involved 

and the amount of deterioration deemed 

‘‘significant’’ for that type of area. For 

example, economic growth may be the 

most important factor in a Class III area, 

but our PSD regulations for such areas 

should offer some level of protection for 

existing clean air resources. In a Class 

I area, our PSD regulations should allow 

some level of economic growth, even 

though preservation of existing clean air 

resources may be the dominant factor 

for these areas. 

5. Authority for States To Adopt 

Alternatives To Increment 

We do not interpret section 166 to 

require that EPA (or that States that 

implement our regulations) employ an 

increment system for every pollutant 

listed in this section. Section 166(d) 

states that our pollutant-specific PSD 

regulations ‘‘may contain’’ increments 

or ‘‘other measures.’’ Thus, EPA or the 

States may employ approaches other 

than an increment system, so long as 

such an approach otherwise meets the 

requirements of sections 166(c) and 

166(d). 

If a State adopts regulations in its SIP 

that meet the criteria of sections 166(c) 

and 166(d), we believe section 166 

would give EPA the authority to allow 

the State to implement that program in 

lieu of the NO2 increment program that 

we are reaffirming today. Thus, one 

approach we proposed for fulfilling our 

obligation to promulgate pollutantspecific regulations for NOX under 

section 166 was to adopt regulations 

that allow States to demonstrate that 

alternative programs satisfy section 166. 

Under section 110(a)(1) of the Act, 

each State is required to submit a SIP 

that provides for implementation, 

maintenance, and enforcement of the 

primary and secondary NAAQS 

established by EPA. All areas are 

required to submit SIPs within certain 

timeframes, and those SIPs must 

include specified provisions identified 

under section 110(a)(2) of the Act. SIPs 

for nonattainment areas are required to 

include additional specified control 

requirements, as well as controls 

providing for attainment of any revised 

NAAQS and periodic reductions 

providing ‘‘reasonable further progress’’

in the interim (see section 172(c) of the 

Act). For attainment areas subject to the 

PSD program, section 161 of the Act 

requires that ‘‘each applicable 

implementation plan shall contain 

emissions limitations and such other 

measures as may be necessary, as 

determined under regulations 

promulgated under this part, to prevent 

significant deterioration of air quality in 

each region * * * designated * * * as 

attainment or unclassifiable.’’ We have 

interpreted sections 166 and 161 to 

collectively require that EPA 

promulgate a specific PSD regulatory 

program for each pollutant identified in 

section 166 (such as the existing NO2

increments and associated regulations), 

and then to require the States to adopt 

that program as part of their SIPs. 

Nothing in the CAA precludes EPA from 

promulgating a minimum program, such 

as the NO2 increments we reaffirm 

today, and giving States the option to 

either adopt the minimum program or to 

design an alternative program and 

demonstrate to EPA that such a program 

meets the requirements of sections 

166(c) and 166(d), as interpreted in this 

action. 

One commenter argued that EPA is 

authorized under sections 160, 161, and 

166 of the Act to direct States to adopt 

SIPs that reduce emissions of NOX from 

existing sources. However, we do not 

completely agree with this 

interpretation. The PSD program was 

designed to be a growth management 

program that limits the deterioration of 

air quality beyond baseline levels that 

may be caused by the construction of 

major new and modified sources. The 

commenter disputed this view by 

pointing to language in section 160(2) 

which establishes the goal to ‘‘preserve, 

protect, and enhance’’ air quality in 

national parks. However, considering 

the growth management goals of the 

PSD program, we believe the use of the 

term ‘‘enhance’’ in section 160(2) was 

intended to refer to the visibility 

provisions in sections 169A and 169B 

and those situations where a PSD 

increment is violated. Section 160 lists 

the goals and purposes of part C of the 

CAA, and this part includes sections 

169A and 169B which establish the 

Regional Haze program. An explicit goal 

of this program is to ‘‘remedy any 

existing impairment of visibility in 

mandatory Class I Federal areas.’’ 42 

U.S.C. 7491(a)(1). Thus, we believe the 

goal to ‘‘enhance’’ air quality in national 

parks is implemented through the 

Regional Haze program while the PSD 

program focuses on preserving and 

protecting air quality in these areas. 

However, when a PSD increment is 

violated, we agree that EPA may require 

a State to revise its SIP to correct a 

violation. See 40 CFR 51.166(a)(3). 

Otherwise, we do not interpret these 

PSD provisions to authorize us to direct 

States in their SIPs to achieve 

reductions in emissions from existing 

sources for PSD purposes. 

However, we recognize that the 

growth management goals of PSD may 

also be fulfilled when the States adopt 

controls on existing sources that would 

reduce emissions and allow growth 

from new sources and major 

modifications to existing sources 

without causing significant 

deterioration. Under the increment 

approach, we have previously 

recognized that States may choose to 

require reductions from existing sources 

in order to expand the increments and 

allow for more growth under the PSD 

program.2 However, we have never 

required States to do so because, in the 

absence of an increment violation, we 

do not believe section 166 and other 

provisions in part C give us the legal 

authority to mandate such reductions 

for PSD purposes. 

V. Health and Welfare Effects of NOX

As explained in the preceding section, 

the goals and purposes of the PSD 

program that are especially relevant to 

the development of our pollutantspecific PSD regulations for NOX

address protection of public health and 

welfare, with a particular emphasis on 

the air quality in national parks and 

other natural areas. Thus, we evaluated 

the available scientific and technical 

information on the health and welfare 

effects of NOX to determine whether any 

modification of those increments is 

warranted. 

In this section, we summarize the 

scientific and technical information that 

we considered, as well as the relevant 

health and welfare findings that we 

believe support retaining the existing 

NO2 increments. Additional discussion 

on the potential effects of NOX is 

contained in the February 2005 

proposal. See 70 FR 8880 (February 23, 

2005) at 8888–8894. 

A. Overview of the Potential Effects of 

Nitrogen Oxides 

‘‘Nitrogen oxides’’ is the generic term 

for a group of highly reactive gases that 

contain nitrogen and oxygen in varying 

amounts. The high-temperature 

combustion of fossil fuels, primarily 

59590 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

3Some forms of NOX are produced naturally (via 

lightning, soils, wildfires, stratospheric intrusion, 

and the oceans). 

4Because NO is readily converted to NO2 in the 

atmosphere, the emissions of NOX reported by EPA 

assume NOX in the form of NO2. In predicting 

ambient impacts that may result from emissions of 

NOX, initially is assumed to be emitted from 

sources as NOX. (40 CFR part 50 app W sec. 6.2.4.) 

5Seven oxides of nitrogen are known to occur in 

the atmosphere: nitric oxide (NO), nitrogen dioxide 

(NOX), nitrate (NO3

¥), nitrous oxide N2O), 

dinitrogen trioxide (N2O3), dinitrogen tetroxide 

(N2O4) and dinitrogen pentoxide (N2O5). 

6The term ‘‘welfare’’ is defined in the Act to 

include, inter alia, ‘‘effects on soils, water, crops, 

vegetation, man-made materials, animals, wildlife, 

weather, visibility, and climate.’’ Section 302(h). 

7Ozone is the oxidant found in the largest 

quantities in the atmosphere. The EPA promulgated 

NAAQS for photochemical oxidants in 1971. The 

chemical designation of the standard was changed 

in 1979 from ‘‘photochemical oxidants’’ to ozone. 

See 44 FR 8202 (February 8, 1979). 8Particulate matter (PM) is composed of directly 

emitted particles and secondarily formed particles. 

Secondary particulates are produced from gaseous 

pollutants, mainly NOX, SO2, ammonia, and some 

VOCs. Emissions of NOX can result in the formation 

of particulate nitrates whose contribution to fine 

particles varies depending on geographic location 

and other criteria. 9 In the 1988 final preamble adopting the NO2

increments, we gave limited consideration to 

whether limiting increases of NOX emissions would 

worsen ozone ambient concentrations, in response 

to comments raising this issue. 53 FR at 40668. We 

did not, however, attempt to set the NO2 increments 

to address ozone public health and welfare impacts, 

nor do we believe that is required here, for the 

reasons stated above. Increments for ozone have not 

been established because of the technical difficulty 

associated with predicting ambient concentration 

changes resulting from a single stationary source. 61 

FR 65764, 65776 (Dec. 13, 1996). 

10Nitrate is a major constituent of atmospheric 

PM. Due to limited scientific literature addressing 

the health impacts of nitrates, exposure currently is 

analyzed as exposure to fine PM. (NAPAP, 1998.) 

from electric utilities and mobile 

sources, is a major contributor to the 

formation of nitric oxide (NO) and 

NO2.3 Most NOX from combustion 

sources is emitted as NO (about 95 

percent); the remainder are primarily 

NO2. Emissions of NO are rapidly 

oxidized in the atmosphere to produce 

even more NO2.4 In a relatively short 

time, however, NO2 in the atmosphere 

can be transformed into other nitrogen 

compounds, including nitric acid and 

nitrates. We also know that nitrogen 

oxides 5 play a major role in the 

formation of other criteria pollutants—

ozone and PM (nitrogen-bearing 

particles and acid aerosols)—each with 

their own set of adverse health and 

welfare effects.6 For example, nitrate 

particles contribute to visibility 

impairment and regional haze and 

nitrates are a major component of acidic 

deposition. 

In addition, reduced nitrogen 

compounds, such as ammonia (NH3) 

(derived largely from emissions from 

livestock waste as well as the 

application of fertilizer to the ground) 

and ammonium (NH4

+), are also 

important to many of the public health 

and environmental impacts associated 

with atmospheric nitrogen compounds. 

However, because these nitrogen 

compounds are not associated with 

emissions of NOX from the stationary 

sources subject to review under the PSD 

program, we did not consider it 

appropriate to factor them into the 

review of the adequacy of the existing 

NO2 increments. 

These varied origins of nitrogen in the 

atmosphere add to the difficulty of 

determining the specific source 

contributing to the total nitrogen 

concentration. This, in turn, increases 

the difficulty of designing an emissions 

control strategy for reducing the 

nitrogen contribution in a particular 

area. 

B. Scope of Our Analysis 

In the proposal, we explained that we 

did not believe our pollutant-specific 

PSD regulations for NOX were the 

appropriate place to address the effects 

of the secondary pollutants ozone and 

PM. Some commenters disagreed with 

our proposed approach and argued that 

EPA should address the adverse effects 

of ozone and PM as part of our 

assessment of the existing NO2

increments. Photochemical oxidants 

(ozone)7 and PM 8 are formed in part by 

reactions of NOX emissions with other 

pollutants in the atmosphere. However, 

we do not agree that this fact alone 

dictates that our pollutant-specific PSD 

regulations for NOX must address ozone 

and PM impacts. Because nitrogen 

oxides are not the only compounds that 

contribute to the formation of ozone and 

PM, we believe we can more effectively 

address the effects of PM and ozone 

through separate regulations for these 

pollutants under section 166 of the Act. 

It would be unreasonable to establish 

pollutant-specific PSD regulations to 

protect against the effects of ozone 

without also considering the other major 

precursor for ozone—volatile organic 

compounds. Any PSD regulation 

attempting to mitigate the ozone 

impacts from NOX, notwithstanding the 

ozone NAAQS, would be unfounded 

without also addressing this significant 

component. Thus, we conclude that, for 

PSD purposes, the contribution of NOX

to the formation of ozone should be 

considered primarily in the context of 

the establishment of pollutant-specific 

PSD regulations for ozone.9

Like ozone, PM has several 

precursors, of which NOX is only one. 

NO2 may be transformed to nitrate 

particulates by means of chemical 

reactions in the atmosphere.10 However, 

any PSD strategy for PM should 

consider both direct PM emissions and 

all of the regulated precursors instead of 

placing disproportionate emphasis on 

only one component of the pollutant. 

Regulations for NOX that address PM 

effects in a narrow manner (i.e., nitrates 

only) could potentially affect the 

stringency of the PM increments and 

considerations regarding the baseline 

concentration and baseline date. Thus, 

we believe it would be inappropriate to 

promulgate pollutant-specific 

regulations for NOX based on its 

transformation into PM. In a separate 

notice, EPA intends to consider options 

for regulating precursors to PM2.5.

Some commenters believe that the 

statutory PSD requirements obligate 

EPA to promulgate NOX regulations to 

prevent significant deterioration of air 

quality from ozone and PM. These 

commenters cited language from section 

166(a) of the Act which directs EPA to 

‘‘promulgate regulations to prevent 

significant deterioration of air quality 

which would result from the emissions 

of such pollutants.’’ CAA § 166(a). 

However, we do not interpret this 

language to compel the action 

commenters recommend. The phrase 

‘‘result from emissions of such 

pollutants’’ refers back to the first clause 

of the sentence which lists several 

pollutants (‘‘hydrocarbons, carbon 

monoxide, photochemical oxidants, and 

nitrogen oxides’’) that are subject to 

section 166. We do not read this 

language to compel EPA to promulgate 

a single regulation to address all such 

pollutants at once. Reading the sentence 

as a whole, we interpret the language in 

section 166(a) to provide EPA with the 

discretion to separately promulgate 

pollutant-specific PSD regulations for 

each of these four groups of pollutants 

(which include ozone because it is 

formed by photochemical oxidants). 

Thus we believe our obligation in this 

action to promulgate pollutant-specific 

PSD regulations for ‘‘nitrogen oxides’’

does not necessarily have to include 

consideration of the effects of ozone. 

For similar reasons, we do not read 

the provisions of section 166 of the Act 

to require that EPA consider effects 

attributable to PM when promulgating 

pollutant-specific PSD regulations for 

‘‘nitrogen oxides.’’ Congress established 

separate increments for PM, originally 

measured as total suspended particulate 

(or TSP), under the authority of section 

163 of the Act. Congress later authorized 

EPA to replace the TSP increments with 

increments for PM10. See CAA § 166(f). 

Section 166(a) of the Act also directs 

EPA to promulgate pollutant-specific 

PSD regulations for any pollutants for 

which a NAAQS is established after the 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59591 

11The official titles of these documents are, 

respectively, ‘‘Air Quality Criteria for Oxides of 

Nitrogen,’’ EPA, August 1993; and ‘‘Review of the 

National Ambient Air Quality Standards for 

Nitrogen Oxides: Assessment of Scientific and 

Technical Information,’’ EPA, September 1995. 

12The term ‘‘atmospheric nitrogen deposition’’

refers to the process by which nitrogen compounds 

in the atmosphere are transferred to various 

surfaces, including water, soil, etc. Additional 

discussion on this is provided in sections V and VI 

of this preamble as related to indirect effects of 

NO2. 

enactment of section 166. We interpret 

this language to apply to pollutants such 

as PM2.5 for which we promulgated a 

NAAQS after 1977. Thus, it does not 

follow that section 166 must be read to 

require that EPA consider PM effects 

when promulgating regulations for NOX. 

Another commenter asserted that the 

court’s opinion in EDF v. EPA made it 

abundantly clear that EPA cannot use 

any single NAAQS or NAAQS indicator 

as the sole basis for the regulations 

required by section 166 to address NOX. 

Rather, the commenter stated, EPA must 

evaluate the impact of NOX with 

reference to the goals and purposes in 

sections 101 and 160, which goals and 

purposes encompass protection of 

public health and welfare from ‘‘air 

pollution’’ without exception for any 

specific pollutants or class of pollutants. 

We recognize that emissions of NOX

contribute to a range of direct and 

indirect effects on health, welfare, and 

AQRVs, but we believe this rulemaking 

action should focus on those effects that 

were considered by EPA in the 

development of the NAAQS for NO2. 

This approach is appropriate because 

the need to develop PSD rules is tied to 

the existence of the NAAQS. As the 

court in EDF v. EPA acknowledged ‘‘the 

ambient standards are the basic measure 

of air quality under the [Clean Air Act] 

and the controlling standards by no 

means exclude any value that is the 

subject of focus under the PSD 

provisions.’’ 898 F.2d at 190 (emphasis 

in original). Thus, the health and 

welfare effects that were evaluated by 

EPA when it established the NAAQS 

should also be considered when EPA 

establishes regulations under section 

166 to protect against significant 

deterioration of air quality from NOX

emissions. 

The provisions of section 166 make 

clear that EPA is to establish PSD 

regulations (including an increment, if 

appropriate) under this provision after 

the establishment of a NAAQS for the 

applicable pollutants. In 1971, EPA first 

established a single standard for NO2 as 

both the primary and secondary NAAQS 

addressing NOX. 36 FR 8186 (April 30, 

1971). Congress then passed section 166 

of the Act in 1977 and gave EPA 2 years 

to complete its study and promulgate 

PSD regulations for ‘‘nitrogen oxides.’’

42 U.S.C. 7476(a). In addition, for 

pollutants for which a NAAQS had not 

been promulgated by August 7, 1977, 

Congress gave EPA 2 years from the 

promulgation of such standards to 

establish PSD regulation under section 

166 of the Act. Id. The establishment of 

PSD regulations (which may include 

increments) must necessarily follow the 

NAAQS because the NAAQS provides 

the benchmark against which we are to 

judge ‘‘significant deterioration’’ of air 

quality. 

We do not believe that our decision to 

define the bounds of our analysis as the 

range of effects considered in setting the 

NAAQS is contrary to the court’s 

holding in EDF v. EPA. The court held 

that EPA cannot use the NAAQS as the 

‘‘sole basis’’ for deriving the increment. 

898 F.2d at 190. However, in this action, 

we did not simply focus on the level of 

the NAAQS as a legal standard, as we 

did in 1988. In this rulemaking action 

on remand, we considered the health 

and welfare effects that EPA evaluated 

to establish the NAAQS. But rather than 

considering those effects in relation to 

the standards set forth in section 109, 

we evaluated those effects in relation to 

the factors in sections 166(c) and 160 of 

the Act. The court held that we could 

not rely solely on the NAAQS itself to 

establish increments because of the 

emphasis in sections 166(c) and 160 on 

special considerations, such as 

protection of national wilderness areas, 

whose special values may be reflected 

in the NAAQS but are not necessarily 

the only factors that determine the level 

of the NAAQS. See 898 F.2d at 190. 

Thus, within the field of effects that 

EPA found relevant when establishing 

the NAAQS, we narrowed our inquiry to 

focus on the special considerations of 

PSD and those effects that may occur in 

some areas notwithstanding attainment 

of the NAAQS. This approach follows 

directly from the court’s opinion in EDF 

v. EPA. 

C. Data Considered in Our Analysis 

In our February 2005 notice, we 

proposed to focus primarily on the 

health and welfare information that we 

had compiled for the last periodic 

review of the NO2 NAAQS. EPA is 

required to conduct a periodic, 

comprehensive analysis of available 

scientific and technical data as part of 

its process for promulgating NAAQS in 

accordance with sections 108 and 109 of 

the Act. The last reevaluation of the 

NAAQS for NOX was completed in 

1996. 61 FR 52852, November 8, 1996. 

The most recently reviewed data for 

NOX is contained in the 1993 Criteria 

Document for NOX (‘‘1993 Criteria 

Document’’) and the associated 1995 

OAQPS Staff Paper (‘‘1995 Staff Paper 

for NOX’’), as further explained below.11

Although we also considered the 

information contained in studies 

published since the last NAAQS review, 

several commenters believed that we 

should have given greater attention to 

such later studies. These commenters 

believe these later studies show the 

growing seriousness of NOX effects in 

the form of ozone, PM and atmospheric 

nitrogen deposition (N deposition).12

One commenter felt that we ignored a 

lot of scientific information on NOX

effects on ecosystems. Another 

commenter argued that our focus on the 

review of the 1993 Criteria Document 

and 1995 Staff Paper for NOX was a 

‘‘self-imposed limitation’’ that relied on 

incomplete scientific information 

considering the fact that new 

information has been developed since 

then. 

Although we did focus on the Criteria 

Document and 1995 Staff Paper for 

NOX, we did not wholly ignore new 

information as the commenters appear 

to suggest. We considered information 

contained in more recent studies, 

particularly those concerning the types 

of effects on ecosystems associated with 

atmospheric nitrogen deposition. We 

evaluated information published since 

completion of the last NAAQS review to 

determine whether there have been 

significant advances in scientific and 

technical information. The more recent 

data we reviewed has clearly broadened 

our understanding of the ecological 

changes resulting from deposition in 

general and N deposition in particular. 

Recent information also provides us 

with greater information about N 

deposition trends and the speciation of 

various N components. The collection of 

these types of information is an 

essential step in the process of 

quantitatively defining the doseresponse relationship between 

emissions of NOX and the various 

adverse effects being observed. 

However, even these later studies, 

including ones supplied by some of the 

commenters, do not enable us to 

establish those relationships at this 

time. 

We focused on the effects described in 

the Criteria Document and 1995 Staff 

Paper for NOX because these documents 

are the product of a rigorous process 

that is followed to validate and interpret 

the information. In accordance with the 

Act, the NAAQS process begins with the 

development of ‘‘air quality criteria’’

under section 108 for air pollutants that 

‘‘may reasonably be anticipated to 

59592 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

13The court pointed out that ‘‘the ‘goals and 

purposes’ of the PSD program, set forth in § 160, are 

not identical to the criteria on which the ambient 

standards are based * * *’’

endanger public health or welfare’’ and 

that come from ‘‘numerous or diverse’’

sources. Section 108(a)(1). For each 

NAAQS review, the Administrator must 

appoint ‘‘an independent scientific 

review committee composed of seven 

members of the National Academy of 

Sciences, one physician, and one person 

representing State air pollution control 

agencies,’’ known as the Clean Air 

Scientific Advisory Committee 

(CASAC). Section 109(d)(2)(A). CASAC 

is charged with recommending revisions 

to the criteria document and NAAQS, 

and advising the Administrator on 

several issues, including areas in which 

additional knowledge is required to 

appraise the adequacy and basis of 

existing, new or revised NAAQS. 

Section 109(d)(2)(B), (C). 

‘‘Air quality criteria’’ must reflect the 

latest scientific knowledge on ‘‘all 

identifiable effects on public health or 

welfare’’ that may result from a 

pollutant’s presence in the ambient air. 

42 U.S.C. 7408(a)(2). The scientific 

assessments constituting air quality 

criteria generally take the form of a 

‘‘criteria document,’’ a rigorous review 

of all pertinent scientific studies and 

related information. The EPA also 

develops a ‘‘staff paper’’ to ‘‘bridge the 

gap’’ between the scientific review and 

the judgments the Administrator must 

make to set standards. See Natural 

Resources Defense Council v. EPA 

(‘‘NRDC’’), 902 F.2d 962, 967 (D.C. Cir. 

1990). Both documents undergo 

extensive scientific peer-review as well 

as public notice and comment. See e.g., 

62 FR 38654/1–2. 

Our focus on the 1993 Criteria 

Document and the 1995 Staff Paper for 

NOX is supported by the provisions of 

section 166 which make clear that EPA 

is to establish pollutant-specific PSD 

regulations after the establishment of a 

NAAQS for the applicable pollutants. 42 

U.S.C. 7476(a). Under normal 

circumstances, the Act provides that 

EPA promulgate new PSD regulations 

under section 166, including new 

increments if appropriate, within 2 

years from the promulgation of any 

NAAQS after 1977. 42 U.S.C. 7476(a). In 

such instances, the health and welfare 

information used for the setting of the 

NAAQS would also be ‘‘current’’ for 

purposes of establishing pollutantspecific PSD regulations. We believe 

this timing was intended to enable EPA 

to rely upon the same body of 

information concerning a pollutant’s 

health and welfare effects when it 

establishes the NAAQS and the 

subsequent PSD increments (or other 

measure) defining significant air quality 

deterioration for the same pollutant. 

Thus, while we believe it would be 

consistent with congressional intent to 

rely in the ordinary case on only the 

information used in the most recent 

NAAQS review when establishing 

pollutant-specific PSD regulations 

under section 166, the situation we 

faced with NOX was unique. Because 

considerable time had passed since the 

1996 review of the NO2 NAAQS, we 

considered the more recent studies 

discussed above. 

Because EPA is taking this action to 

fulfill a court remand of an increment 

originally established in 1988, the Act 

could be read to suggest that we revert 

back to the information compiled in the 

NAAQS review that predated our initial 

action in 1988. When the NO2

increments were originally developed 

and promulgated, the most recent 

Criteria Document for oxides of nitrogen 

was EPA’s 1982 Criteria Document, 

used for completing the periodic review 

of the NO2 NAAQS promulgated on 

June 19, 1985 (50 FR 25532). However, 

because of the amount of time that has 

passed since then, we do not believe it 

is reasonable to read the Act so 

narrowly in this case. Thus, we relied 

on the most recent Criteria Document, 

because it represented the most recent 

compilation of scientific and technical 

evidence for purposes of NAAQS 

review, even though this was not the 

Criteria Document we used to develop 

the 1988 NO2 increments. 

In the last periodic review of the NO2

NAAQS, in 1996, EPA compiled 

information that was not part of the 

scope of the previous NAAQS review. 

Specifically, the 1993 Criteria Document 

and 1995 Staff Paper for NOX

considered as part of the secondary 

standard review ‘‘short- and long-term 

effects of nitrogen deposition on 

biological, physical and chemical 

components of ecosystems and the 

resulting effect of changes to these 

components on ecosystem structure and 

function as well as the traditional issue 

of visibility impairment, and materials 

damage.’’ The expanded scope is 

particularly relevant to the types of 

effects that should be used to consider 

the effectiveness of the PSD increments. 

We do not interpret the court decision 

in EDF v. EPA 13 to mean that we should 

not consider the same data when 

establishing both the NAAQS and the 

PSD increments for a particular 

pollutant, but rather that we would be 

expected to weigh the same data 

differently using the different legal 

criteria as our guide. Consequently, we 

might arrive at different conclusions for 

developing the NAAQS and increments 

because of the differences in the legal 

criteria for the two types of standards. 

As the court itself said, ‘‘a pollutant that 

has only mild public health effects but 

severe effects on wilderness areas might 

demand a lower increment (measured as 

a percentage of its ambient standards) 

than one with severe health effects but 

only mild effects on wilderness areas.’’

EDF v. EPA, 898 F.2d at 190. Thus, 

while the Act seems to require that EPA 

establish NAAQS and increments for 

the same pollutant using different legal 

standards, we believe it is important 

nevertheless that the body of evidence 

used for both reviews should initially be 

subjected to the same level of Agency 

validation and review. 

D. Analysis of Potential Effects 

This section contains a summary of 

our review of the health and welfare 

effects associated with NOX reviewed by 

EPA as part of the reconsideration of the 

pollutant-specific PSD regulations for 

NOX. Although EPA concluded from the 

available evidence that there was no 

basis in 1996 for revising the NO2

NAAQS, the objective of our latest 

review of the same body of scientific 

and technical evidence was to 

determine whether there is any basis for 

proposing to modify the NO2

increments, based on specific 

percentages of those NAAQS, which are 

part of the PSD regulations for NOX that 

we promulgated in 1988. Our analysis of 

the health and welfare effects associated 

with NOX included adverse health 

effects that were found to occur at levels 

at or near the NAAQS, as well as a 

variety of direct NO2 welfare effects and 

indirect welfare effects resulting from 

the transformation of NO2 to other 

nitrogen compounds in the atmosphere 

which are then transferred to other 

surfaces via N deposition. 

We noted earlier that the 1993 Criteria 

Document and 1995 Staff Paper for NOX

added a level of review not contained in 

the previous periodic review of the 

NAAQS for NOX. That is, the most 

recent documents include evidence 

concerning ‘‘short- and long-term effects 

of N deposition on biological, physical 

and chemical components of ecosystems 

and the resulting effect of changes to 

these components on ecosystem 

structure and function as well as the 

traditional issues of visibility 

impairment and materials damage.’’ The 

consideration of such effects was our 

primary focus for determining whether 

the existing increments need to be 

modified to satisfy section 166(c) of the 

Act. 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59593 

14Under certain conditions, in terrestrial or 

agricultural systems, some amount of nitrogen 

deposition can enhance growth of some forest 

species and crops. However, in areas where 

deposition occurs in excess of plant and microbial 

demand (also known as nitrogen saturation) the 

added nitrogen can disturb the nitrogen cycle, 

contributing to such negative effects as increased 

plant susceptibility to some natural stresses and 

modification of interplant competition. 

1. Health Effects 

In 1996, EPA concluded that there 

was no need to change the existing 

primary NAAQS for NO2 on the basis of 

the health effects evidence available at 

that time. Nevertheless, for purposes of 

evaluating the safe harbor NO2

increments, we examined those effects 

which were found to occur at levels at 

or near NAAQS. Of particular concern 

were possible health effects resulting 

from short-term exposure (e.g., less than 

3 hours), which might justify 

consideration of a short-term increment. 

The short-term health effects of most 

concern at ambient or near-ambient 

concentrations of NO2 involved mild 

changes in airway responsiveness 

(airway constriction and narrowing) and 

decrease in pulmonary function. In 

neither case were the observed effects 

considered serious: Observations of 

airway constriction did not reveal 

airway inflammation and were fully 

reversible, and changes in pulmonary 

function were considered small. 

Moreover, most of the observed effects 

occurred at ambient concentrations of 

NO2 that were above levels typically 

monitored in areas meeting the NAAQS, 

i.e., PSD areas. 

We also considered effects based on 

longer-term (2-week periods), low-level 

exposure to NO2 involving increased 

respiratory illnesses among children. 

These studies involved situations of 

indoor exposure to NO2 emitted from 

gas stoves. Various limitations 

associated with these clinical studies 

made it difficult to extrapolate the 

results in a manner that would yield 

estimates of health impacts associated 

with outdoor NO2 exposure. See 

February 2005 proposal at 70 FR 8890–

8891. 

2. Welfare Effects 

In our February 2005 proposal, we 

indicated that the 1996 periodic review 

of the NO2 NAAQS concluded that the 

available body of scientific and 

technical evidence did not provide an 

adequate basis for setting a separate 

secondary standard to address welfare 

effects of NOX. See 70 FR at 8891. 

However, as discussed earlier, the goals 

and purposes of the PSD program give 

special weight to the protection of 

welfare, air quality values and areas of 

special national and regional interest 

(national parks, national wilderness 

areas, etc.) Accordingly, EPA reviewed 

the information on welfare effects to 

determine whether it supported a need 

on our part to modify the existing NO2

increments to provide additional 

environmental protection, especially for 

such areas as national parks, wilderness 

areas and their natural, recreational, 

scenic, or historic value(s), 

notwithstanding attainment of the 

NAAQS in PSD areas. 

As mentioned earlier, the evidence we 

reviewed covered both direct (NO2) and 

indirect (other NOX), short- and longterm effects on biological, physical and 

chemical components of ecosystems and 

the resulting effect of changes to these 

components on ecosystem structure and 

function. Information from selected later 

studies was also reviewed to determine 

the extent to which our knowledge of 

the adverse effects of NOX had advanced 

since the 1996 review. A summary of 

our review of both direct and indirect 

effects of NO2 is presented below. 

a. Direct Welfare Effects 

The 1993 Criteria Document and 1995 

Staff Paper for NOX provided evidence 

that exposure to NO2 can cause 

potentially adverse effects on plants and 

materials, and visibility impairment 

(primarily in the form of local-scale 

plume discoloration). These effects are 

summarized below. See also 70 FR 

8892–8893. 

Experimental studies involving 

exposure of plants to NO2 for periods 

less than 24 hours produced effects on 

the growth development and 

reproduction of plants. However, the 

pollutant concentrations used in these 

experiments were well above 

concentrations observed in the ambient 

air and at a frequency of occurrence not 

typically found in the U.S. The 

experimental effects were not 

considered significant at concentrations 

at or below the level of the NAAQS. 

The effects of NO2 on materials were 

not well determined according to the 

evidence contained in the 1993 Criteria 

Document. The limited information 

showed that it was difficult to 

distinguish NO2 or any other agent as 

the single causative agent for observed 

damage; many agents, together with a 

number of environmental stresses, act 

on the surface of materials over time. 

Finally, NO2 can cause visibility 

impairment in the form of a 

discoloration effect most noticeable as 

local-scale (within 50 kilometers of the 

source) or ‘‘reasonably attributed 

impairment.’’ This effect can be 

observed as a contrast or color 

difference between a plume and a 

viewed background, such as the sky or 

a distant object. However, some studies 

have shown that brownish discoloration 

can result from the presence of particles 

alone, thus making it difficult to 

determine a reliable relationship 

between ground-level concentrations of 

NO2 at any given point and 

discoloration caused by particles that 

may also be in a source’s plume. The 

1995 Staff Paper for NOX noted that 

despite the known light-absorbing 

qualities of NO2, ‘‘there are relatively 

little data available for judging the 

actual importance of NO2 to visual air 

quality.’’

b. Indirect Welfare Effects 

The predominant welfare effects of 

NO2 are indirect effects caused by 

nitrogen compounds that have been 

transformed from NO2 in the 

atmosphere, such as nitric acid and 

nitrates. Studies have shown that 

nitrogen compounds can contribute to 

various negative ecological effects when 

they are transferred from the 

atmosphere to a variety of surfaces, e.g., 

water, soil, vegetation, and other 

materials, by the process of N 

deposition.’’ 14

Nitrogen deposition occurs in several 

forms, including wet (rain or snow), dry 

(transfer of gases or particles), or occult 

(fog, mist or cloud) deposition. Nitrogen 

deposition occurs primarily as nitrates, 

which are formed in the atmosphere by 

the oxidation of NO and NO2, or as 

ammonia, which is released by 

agricultural or soil microbial activity. 

When the nitrogen transfer process 

involves acids (e.g., nitric acid) or 

acidifying compounds, the deposition 

process is referred to as ‘‘acidic 

deposition.’’

For the February 2005 proposal, we 

reviewed various indirect effects 

resulting from N deposition and which 

can be categorized according to the 

specific ecosystem being affected. These 

include terrestrial, wetland, and aquatic 

ecosystems. These different effects are 

summarized below. See also 70 FR 

8888–8894. 

As with the other effects we 

considered, we focused primarily on the 

evidence contained in the 1993 Criteria 

Document and 1995 Staff Paper for the 

NO2 NAAQS. Other more recent studies 

were also summarized, although we did 

not consider ourselves to be under an 

obligation to consider such evidence 

since it has not yet undergone the 

extensive level of validation and review 

that will be necessary if it is to be 

incorporated into the section 108 

Criteria Document for NOX. 

The following subsections summarize 

the various indirect effects of NO2 on 

59594 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

15Aluminum from soil seldom appears in aquatic 

systems because natural aluminum minerals are 

insoluble in the normal pH range of natural waters. 

However, the term ‘‘aluminum mobilization’’ refers 

to the conversion of aluminum in acidic soils into 

dissolved forms and its transport, as runoff or 

subsurface flow, to water systems. Mobilized 

aluminum can then alter the acid/base property of 

natural water systems (Wang, 2004). 

ecosystems, including terrestrial 

systems (i.e., plant communities), 

wetlands, and aquatic systems. We 

believe that the effects summarized are 

potentially relevant to an evaluation of 

the pollutant-specific PSD regulations 

for NOX because these effects have been 

observed in areas of the country that are 

attaining the NAAQS. 

(1) Terrestrial ecosystems. Soils are 

the largest pool of nitrogen in forest 

ecosystems, although such nitrogen is 

generally not available for plants until it 

has been mineralized by bacteria (Fenn, 

1998). Another important source of 

nitrogen is atmospheric deposition, 

which may cause or contribute to 

significant adverse changes in terrestrial 

ecosystems, including soil acidification, 

increase in soil susceptibility to natural 

stresses, and alterations in plant species 

mix. 

When excess nitrogen input causes 

soil acidification, it can alter the 

availability of plant nutrients (i.e., 

calcium and magnesium) and expose 

tree roots to toxic levels of aluminum 

and manganese, thereby having an 

adverse effect on tree growth. It can also 

lead to the mobilization of aluminum 

from the soil as nitrates are leached 

from the soil and transported to 

waterways, where the aluminum can 

exhibit toxic effects to aquatic 

organisms.15

It is worth noting that air pollution is 

not the sole cause of soil change; high 

rates of acidification are occurring in 

less polluted regions of the western U.S. 

because of natural internal soil 

processes, such as tree uptake of nitrate 

and nitrification associated with 

excessive nitrogen fixation. Although N 

deposition can accelerate the 

acidification of soils, the levels of 

nitrogen necessary to produce 

measurable soil acidification are quite 

high. The 1993 Criteria Document 

indicated that, at that time, N deposition 

had not been directly associated with 

the acidification of soils in the U.S. 

More recent information suggests that in 

parts of the Northeast, for example, acid 

deposition has resulted in the 

accumulation of sulfur and nitrogen in 

the soil beyond the levels that forests 

can use and retain, and has accelerated 

the leaching of base cations, such as 

calcium and magnesium, that help 

neutralize acid deposition. (Driscoll, 

2001.) Some western forest areas may 

also be experiencing nitrogen saturation 

conditions, although the role of N 

deposition may vary from one location 

to another (Fenn, 1998, 2003). 

Aside from the effects of soil 

acidification, some studies have shown 

that increased N deposition can alter 

tree susceptibility to frost damage, 

insect and disease attack, and plant 

community structure. However, other 

studies have not shown that similar 

results occur. In all, the studies 

evaluated in the 1993 Criteria Document 

which focused on the impact of 

excessive inputs of nitrogen in forest 

ecosystems showed mixed results. The 

long response time of trees to 

environmental stresses has made it 

difficult to fully understand how acid 

rain may affect trees. It is also difficult 

to isolate the possible effects of acid rain 

from stresses resulting from other 

natural and anthropogenic origins. 

However, more recent studies appear to 

provide some evidence that acid 

deposition has caused the death of red 

spruce trees, particularly at higher 

elevations in the Northeast by 

decreasing cold tolerance, and may be 

in part responsible for the extensive loss 

of sugar maple in Pennsylvania. 

(Driscoll, 2001.) 

Finally, in terrestrial systems in 

which the pre-existing balance is 

marked by a competition among species 

for the available nitrogen, additional 

nitrogen inputs, such as N deposition, 

may bring about an alteration of the 

species mix. That is, a displacement of 

one kind of vegetation (e.g., plants, 

grasses) with another may occur. While 

the 1995 Staff Paper for NOX noted that 

there were no documented accounts of 

terrestrial ecosystems undergoing 

species shifts due to N deposition in the 

U.S., later research provides some 

evidence suggesting that elevated N 

deposition can contribute to shifts of 

species compositions (e.g., Allen, 1998; 

Bowman, 2000). 

(2) Wetlands. Wetlands include 

swamps, marshes, and bogs. In such 

lands, water saturation is the dominant 

factor determining the nature of soil 

development and the types of plants 

and animal communities living in the 

soil and on its surface. These areas 

function as habitats for plant and 

wildlife (among other useful 

environmental purposes), including 

many rare and threatened plant species. 

Some of these plants adapt to systems 

low in nitrogen or with low nutrient 

levels. Long-term studies (greater than 3 

years) of increased nitrogen loadings to 

wetland systems in European countries 

have reported that increased primary 

production of biomass can result in 

changes of interplant competition. The 

1995 Staff Paper for NOX reported that, 

based on the evidence reviewed in the 

1993 Criteria Document, ‘‘the staff 

believes we can anticipate similar 

effects from atmospheric N deposition 

in the United States* * *.’’ However, in 

the 1995 Staff Paper for NOX, EPA 

found no documentation providing 

sufficient evidence that such species 

changes have occurred or were 

occurring at the time in the U.S. 

(3) Aquatic ecosystems. Nitrogen 

deposition may adversely affect aquatic 

ecosystems as a result of either 

acidification or eutrophication. Both 

processes can cause a reduction in water 

quality that makes the body of water 

unsuitable for many aquatic organisms. 

The 1995 Staff Paper for NOX

indicated that growing evidence 

supported the concern that the impact 

of N deposition on sensitive aquatic 

systems ‘‘may be significant.’’ Later 

studies have shown much more clearly 

the harm that can result. Atmospheric 

nitrogen can enter lakes and streams 

either as direct deposition to the water 

surfaces or as N deposition to the 

watershed of which they are a part. In 

some cases, nitrate may be temporarily 

stored in snow packs from which it is 

subsequently released in more 

concentrated form in snowmelt. In other 

cases, nitrogen deposited to the 

watershed may subsequently be routed 

through plants and soil microorganisms 

and transformed into other inorganic or 

organic nitrogen species which, when 

they reach the water system, are only 

indirectly related to the original 

deposition. To complicate matters, 

recent studies suggest that, in addition 

to the contribution of nitrogen from 

anthropogenic sources, nitrogen 

released from the weathering of 

nitrogen-bearing bedrock, not 

commonly considered in the 

biogeochemical cycling of nitrogen, may 

contribute a ‘‘surprisingly large 

amount’’ of nitrate to natural waters. 

(Dahlgreen, 2002.) 

Acidification may occur in two ways: 

Chronic (long-term) acidification and 

episodic (short-term or seasonal) 

acidification. Episodic acidification is 

more likely to be the primary problem 

in most situations, with chronic 

acidification occurring mainly where 

excessive nitrogen saturation exists. 

(NAPAP, 1998.) The main concern with 

acidification of aquatic ecosystems is 

associated with freshwater systems. 

Acidification impairs the water quality 

of lakes and streams by lowering the pH 

levels, decreasing acid-neutralizing 

capacity, and increasing aluminum 

concentrations (through the process of 

aluminum mobilization from the soil, as 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59595 

explained earlier). High levels of 

aluminum, considered toxic to fish and 

other organisms, have been recorded in 

watersheds in the Northeast associated 

with low levels of acid deposition. 

(Driscoll, 2001.) 

Acid deposition may also increase the 

conversion of mercury to organic 

(methyl) mercury in lakes where it is 

absorbed by aquatic organisms and 

leads to increasing concentrations in the 

food chain. Human consumption of fish 

containing high levels of methylmercury 

can lead to problems with the central 

nervous system. 

Regions of North America differ in 

their sensitivity to acidic deposition and 

in the amount of acidic deposition they 

receive. Some parts of the eastern U.S. 

are highly sensitive and chronically or 

episodically receive damaging 

concentrations of acidic deposition. For 

example, a 2001 report indicates that 41 

percent of lakes in the Adirondack 

Mountain region of New York and 15 

percent of lakes in New England show 

evidence of either chronic or episodic 

acidification, or both. (Driscoll, 2001.) 

Other sensitive regions, such as the 

western U.S., are unlikely to suffer 

adverse chronic effects but may 

experience acidic conditions more on an 

episodic basis. Certain high-elevation 

western lakes, in particular, are subject 

to episodes of acidic deposition. 

Eutrophication generally is a natural 

process by which aquatic systems are 

enriched with the nutrients, including 

nitrogen, that are presently limiting for 

primary production in that system. 

However, this process can be 

accelerated by increased nutrient input 

resulting from anthropogenic sources, 

e.g., agricultural runoff, urban runoff, 

leaking septic systems, sewage 

discharge. Studies have also shown that 

N deposition may directly and 

indirectly play a role in accelerated 

eutrophication. When nitrogen is a 

limiting nutrient, input from various 

origins can make a water system prone 

to eutrophication, with impacts ranging 

from the increased turbidity and floating 

mats of macro algae shading out 

beneficial submersed aquatic vegetation 

habitat, to the exacerbation of noxious 

algae blooms, to the creation of low or 

no-oxygen conditions which negatively 

affect fish populations. The National 

Park Service (NPS) has reported that 

loadings of total N deposition (wet and 

dry) have caused changes in aquatic 

chemistry and biota in the Rocky 

Mountain National Park’s high elevation 

ecosystems. (U.S. Department of the 

Interior, 2002.) In the same report, the 

NPS noted that increasing trends in N 

deposition at many parks in the western 

U.S. result from both nitrate and 

ammonium. 

The key to creating a linkage between 

levels of N deposition and the 

eutrophication of aquatic systems is to 

demonstrate that the productivity of the 

system is limited by nitrogen 

availability, and to show that N 

deposition is a major source of nitrogen 

to the system. Thus, while it appears 

that nitrogen inputs to aquatic systems 

may be of general concern for eutrophic 

conditions, the significance of nitrogen 

input will vary from site to site. (1995 

Staff Paper for NOX at 77.) 

A 1993 National Research Council 

report identifying eutrophication as the 

most serious pollution problem facing 

the estuarine waters of the U.S. was 

reported in an EPA document issued in 

1997, entitled ‘‘Nitrogen Oxides: 

Impacts on Public Health and the 

Environment’’ (p. 79). Nitrogen input is 

a major concern because nitrogen is the 

limiting nutrient for algae growth in 

many estuaries and coastal water 

systems. In contrast to the 

eutrophication concern, acidification 

typically is not a concern, because 

estuaries and coastal waters receive 

substantial amount of weathered 

material from terrestrial ecosystems and 

from exchange with sea water. 

Estimation of the contribution of 

atmospheric N deposition to the 

eutrophication problem can be difficult 

because of the various direct 

anthropogenic sources of nitrogen, 

including agricultural runoff and 

sewage. Some studies have shown that 

nitrogen deposited from the atmosphere 

can be a significant portion of the total 

nitrogen loadings in specific locations, 

such as the Chesapeake Bay—the largest 

of the 130 estuaries in the U.S. It has 

been estimated that the proportion of 

the total nitrate load to the Bay 

attributable to N deposition ranges from 

10 to 45 percent (NAPAP, 1998). 

In most freshwater systems, including 

lakes and streams, phosphorus, not 

nitrogen, is the limiting nutrient. Thus, 

eutrophication by nitrogen inputs will 

only be a concern in lakes that are 

chronically nitrogen limited and have a 

substantial total phosphorus 

concentration. This condition is 

common only in lakes that have 

received excessive inputs of 

anthropogenic phosphorus or, in rare 

cases, have high concentrations of 

natural phosphorus. In the former case, 

the primary dysfunction of the lakes is 

an excess supply of phosphorus, and 

controlling N deposition would be an 

ineffective method of gaining water 

quality improvement. In the latter case, 

N deposition can measurably increase 

biomass and thus contribute to 

eutrophication in lakes with high 

concentrations of natural phosphorus. 

Other lakes, including some highelevation lakes in the Rocky Mountains 

and Sierra Nevada, are very low in both 

phosphorus and nitrogen; addition of 

nitrogen can increase biomass and 

contribute to eutrophication in these 

lakes also. 

(4) Visibility impairment (Regional 

Haze). Nitrate particulates are formed as 

a result of chemical reactions involving 

NO and NO2 with other substances in 

the atmosphere, such as ammonia. 

These particulates, as both fine and 

coarse particles, are considered to be 

more responsible for visibility 

impairment than NO2 directly. The fine 

particles can remain airborne for 

considerable periods of time, may be 

transported long distances from the NOX

source, and impair visibility by either 

scattering light or absorbing it. 

The major cause of visibility 

impairment in the East is sulfates, not 

nitrates which account for only 7 to 16 

percent of the light extinction in the 

East. However, nitrates in the West are 

responsible for up to 45 percent of the 

light extinction. 

Recent studies tend to provide more 

comprehensive documentation of 

certain adverse effects than were 

reported earlier in the 1993 Criteria 

Document. However, even in such later 

studies the inability to establish 

quantifiable dose-response relationships 

NOX and the various types of 

ecosystems remains to be a key problem. 

More study is needed to resolve this 

problem. 

VI. Final Actions 

In the February 2005 proposal, we 

presented for public review and 

comment the results of our review of the 

scientific and technical evidence. We 

described the various health and welfare 

effects associated with NO2 and other 

forms of NOX and proposed our 

decision about the adequacy of the 

existing NO2 increments. On the basis of 

the available information, we proposed 

not to change the existing PSD 

regulations for NOX. We also proposed 

to find that the existing regulations, 

including the increments for NOX

expressed as annual average ambient 

concentrations of NO2 satisfied the 

requirements under sections 166(c) and 

166(d) of the Act. 

In today’s action, we are retaining the 

existing NO2 increments without 

change. In addition, we are amending 

the text of our PSD regulations at 40 

59596 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

16Section 51.166 of the CFR contains minimum 

requirements for the submittal and adoption of 

regulations that are part of a SIP. We are not making 

similar changes to the Federal PSD regulations at 

40 CFR 52.21. 

17This date is actually identified as the ’minor 

source baseline’’ date in EPA regulations. 40 CFR 

51.166(b)(14); 40 CFR 52.21(b)(14). Because the 

baseline concentration does not include emissions 

from certain major sources that consume increment, 

EPA has distinguished between the ’minor source 

baseline’’ date and the ’major source baseline date.’’

See 40 CFR 51.166(b)(13)–(14); 40 CFR 

52.21(b)(13)–(14). 

18For PSD baseline purposes, a source generally 

‘‘affects’’ an area when its new emissions increase 

is projected to result in an ambient pollutant 

increase of 1 μg/m3 (annual average) or more of the 

pollutant. 

CFR 51.166 16 to clarify that any State 

may employ an alternative approach to 

the NO2 increments if the State’s 

approach meets certain requirements. 

Separately, we will soon publish a 

supplemental notice of proposed 

rulemaking that provides more details 

on how a State that achieves the NOX

emission reductions under CAIR can 

utilize its CAIR-related reductions as 

part of its alternative approach to the 

NO2 increments. In this section of the 

preamble, we describe our rationale for 

the final action we are taking today on 

the NO2 increments and respond to 

significant comments we received on 

the relevant portions of the proposal. 

A. Retain Existing Increment System for 

NOX

1. Existing Characteristics of the 

Regulatory Scheme Fulfill Statutory 

Criteria 

In the February 2005 proposal, we 

addressed how several aspects of our 

PSD regulations for NOX that were not 

controverted in the EDF v. EPA court 

challenge served to satisfy many of the 

factors applicable under section 166(c). 

This analysis helps show how our PSD 

regulations for NOX, as a whole, satisfy 

the criteria in section 166. 

We continue to believe that many of 

the factors applicable under section 

166(c) are fulfilled by the elements of 

our regulations that were not challenged 

in the EDF v. EPA case. Since we do not 

interpret the court’s decision to require 

us to reevaluate the entire regulatory 

framework of the PSD regulations for 

NOX we established in 1988, with 

respect to option 1 of the proposal, we 

focused our review on the level, time 

period, and pollutant form (NO2) 

reflected in the increments we included 

in the 1988 PSD regulations for NOX. 

Thus, when a factor applicable under 

section 166(c) was fully satisfied by an 

aspect of the existing regulations that 

was not questioned by the court, we did 

not consider that factor any further in 

our evaluation of the characteristics of 

the increment. 

In many cases, an aspect of our 

regulations that was not controverted in 

the court challenge partially contributes 

to the fulfillment of an applicable factor 

but does not fully satisfy that factor. In 

these instances, to determine if changes 

to the increments are necessary to 

satisfy the factors applicable under 

section 166(c), we also considered the 

effectiveness of the unchallenged parts 

of our regulations in conjunction with 

the three primary characteristics of the 

increments that were challenged. We 

believe our obligations under section 

166(c) of the Act are satisfied when all 

of our pollutant-specific PSD 

regulations for NOX (including the level 

and other characteristics of any 

increment) collectively satisfy the 

factors applicable under 166(c) of the 

Act. 

a. Increment System 

Two of the factors applicable under 

section 166(c) are fulfilled by employing 

an increment system in our pollutantspecific PSD regulations for NOX. In this 

action, we are retaining this basic 

framework for our pollutant-specific 

PSD regulations for NOX. 

An increment-based program fulfills 

our obligation under section 166(c) to 

provide ‘‘specific numerical measures 

against which permit applications may 

be evaluated.’’ Under section 165(a)(3) 

of the Act, a permit applicant must 

demonstrate that emissions from the 

proposed construction and operation of 

a facility ‘‘will not cause, or contribute 

to, air pollution in excess of any (A) 

maximum allowable increase or 

maximum allowable concentration for 

any pollutant.’’ 42 U.S.C. 7475(a)(3). 

An increment is the maximum 

allowable increase of an air pollutant 

that is allowed to occur above the 

applicable baseline concentration. The 

baseline concentration in a particular 

area is generally the ambient pollutant 

concentration at the time the first 

complete PSD permit application is 

submitted (i.e., the baseline date) 17 by 

a new major stationary source or a major 

modification locating in or otherwise 

affecting that area.18 By establishing the 

maximum allowable level of ambient 

pollutant concentration increase in a 

particular area, an increment defines 

‘‘significant deterioration.’’ Once the 

baseline date associated with the first 

proposed new major stationary source 

or major modification in an area is 

established, the new emissions from 

that source consume a portion of the 

increment in that area, as do any 

subsequent emissions increases that 

occur from any source in the area. When 

the maximum pollutant concentration 

increase defined by the increment has 

been reached, additional PSD permits 

cannot be issued until sufficient 

amounts of the increment are ‘‘freed up’’

via emissions reductions that may be 

required by the permitting authority. 

Moreover, the air quality in a region 

cannot deteriorate to a level in excess of 

the applicable NAAQS, even if all the 

increment has not been consumed. 

Thus, areas where the air pollutant 

concentration is near the level allowed 

by the NAAQS may not be able to use 

the full amount of pollutant 

concentration increase allowed by the 

increment. 

Thus, an increment is a quantitative 

value that establishes the ‘‘maximum 

allowable increase’’ for a particular 

pollutant. It functions, therefore, as a 

specific numerical measure that can be 

used to evaluate whether an applicant’s 

proposed project will cause or 

contribute to air pollution in excess of 

allowable levels. 

Increments also satisfy the second 

factor in section 166(c) by providing ‘‘a 

framework for stimulating improved 

control technology.’’ Increments 

establish an incentive to apply more 

stringent control technologies in order 

to avoid violating the increment. Given 

that the PSD increment level may be 

consumed by cumulative emissions 

increases over time, it may become 

necessary to impose increasingly more 

stringent levels of control on new 

sources in order to avoid violating the 

increment or ensuring that there will be 

increment remaining for additional 

economic growth. The more stringent 

control technologies utilized in these 

areas may become the basis of BACT 

determinations elsewhere, as the 

technologies become more 

commonplace and the costs tend to 

decline. See also S. Rep. 95–127 at 18, 

30 (3 LH at 1392, 1404) (‘‘the 

incremental ceiling should serve as an 

incentive to technology, as a potential 

source may wish to push the frontiers of 

technology in a particular case to obtain 

greater productive capacity within the 

limits of the increments’’). 

Because the existing increment-based 

regulatory framework, which was not 

controverted in EPA v. EDF, satisfies 

these criteria we are retaining the 

increment approach in this action. 

However, we recognize that an 

increment system is not the only way to 

fulfill the requirements of section 166 of 

the Act. Congress did not require EPA 

to utilize increments in its PSD 

regulations for NOX but gave EPA the 

discretion to employ increments if 

appropriate to meet the criteria and 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59597 

19EPA does not formally track the issuance of 

PSD permits across the country, but EPA’s Regional 

Offices have confirmed that various PSD permits for 

sources of NOX have been issued by many of the 

States in their respective jurisdictions. 

goals and purposes set forth in sections 

166 and 160 of the Act. 42 U.S.C. 

7474(d); EDF v. EPA, 898 F.2d at 185 

(‘‘Congress contemplated that EPA 

might use increments’’). Thus, in this 

action, we are also allowing States to 

develop alternatives to an increment 

system at their discretion, and to submit 

any such alternative program to EPA so 

that we can determine whether it 

satisfies the requirements of section 166. 

In addition, in a separate rulemaking 

action, we are continuing to develop an 

alternative regulatory framework that 

would enable a State to demonstrate 

that the requirements of section 166 are 

satisfied by reducing NOX emissions 

from existing sources under the CAIR 

and other similar programs. 

b. Area Classifications 

Having increments set at different 

levels for each class of PSD area helps 

to fulfill two of the factors applicable 

under section 166(c) of the Act. Under 

the three-tiered area classification 

scheme established by Congress, Class I 

areas are areas where especially clean 

air is most desirable. The original Class 

I areas established by Congress included 

national parks, wilderness areas, and 

other special areas that require an extra 

level of protection. It stands to reason 

that the most stringent increment is 

imposed in Class I areas. In contrast, 

Class III areas, which are those areas in 

which a State wishes to permit the 

highest relative level of industrial 

development, have the least stringent 

increment level. Areas that are not 

especially sensitive or that do not wish 

to allow for a higher level of industrial 

growth are classified as Class II. When 

Congress established this three-tiered 

scheme for SO2 and PM, it intended that 

Class II areas be subject to an increment 

that allows ‘‘moderately large increases 

over existing pollution.’’ H.R. Rep. 95–

294, 4 LH at 2609. The Petitioners in 

EDF v. EPA did not contest EPA’s 

decision in 1988 to employ this same 

classification scheme in our pollutantspecific PSD regulations for NOX. 

Establishing the most stringent 

increments in Class I areas helps fulfill 

EPA’s obligation to establish regulations 

for NOX that ‘‘preserve, protect, and 

enhance the air quality’’ in parks and 

special areas. Class I areas are primarily 

the kinds of parks and special areas 

covered by section 160(2) of the Act. 

With the air quality in Class I areas 

subject to the greatest protection, this 

scheme then provides two additional 

area classifications with higher 

increment levels to help satisfy the goal 

in section 160(3) of the Act that EPA 

‘‘insure that economic growth will occur 

in a manner consistent with 

preservation of clean air resources.’’ In 

those areas where clean air resources 

may not require as much protection, 

more growth is allowed. By employing 

an intermediate level (Class II areas) and 

higher level (Class III areas), this 

classification scheme helps ensure that 

growth can occur where it is needed 

(Class III areas) without putting as much 

pressure on existing clean air resources 

in other areas where some growth is still 

desired (Class II areas). 

By redesignating an existing Class II 

area to Class III, States may 

accommodate economic growth and air 

quality in areas where the Class II 

increment is too stringent to allow the 

siting of new or modified sources. The 

procedures specified by the Act for such 

a redesignation require a commitment of 

the State government to the creation of 

such an area, extensive public review, 

participation in the SIP area 

redesignation process, and a finding that 

the redesignation will not result in the 

applicable increment being exceeded in 

a nearby Class I or Class II area. See 42 

U.S.C. 7474(a)–(b) (Section 164(a)–(b)). 

Our 1988 analysis, 53 FR at 3702–05, 

and the subsequent issuance of PSD 

permits for major new and modified 

sources of NOX since that time 19 tend 

to confirm that, with the existing 

increment levels, the three-tiered 

classification system has allowed for 

economic growth, consistent with the 

preservation of clean air resources. 

However, we do not believe that this 

framework alone completely satisfies 

the factors applicable under section 

166(c) of the Act. The increment that is 

employed for each class of area is also 

relevant to an evaluation of whether the 

area classification scheme achieves the 

goals of the PSD program. We discuss 

the increments further below. 

c. Permitting Procedures 

Two of the factors applicable under 

section 166(c) are fulfilled by the caseby-case permit review procedures that 

are built into our existing regulations. 

The framework of our existing PSD 

regulations employs the preconstruction 

permitting system and procedures 

required under section 165 of the Act. 

42 U.S.C. 7475. These requirements are 

generally reflected in sections 51.166 

and 52.21 of EPA’s PSD regulations in 

Title 40 of the Code of Federal 

Regulations. These permitting and 

review procedures, which we interpret 

to apply to construction of new major 

sources and to major modifications at 

existing sources, fulfill the goals set 

forth in sections 160(4) and 160(5) of the 

Act. These goals require that PSD 

programs in one State not interfere with 

the PSD programs in other States and 

that PSD programs assure that any 

decision to permit increased air 

pollution is made after careful 

evaluation and public participation in 

the decisionmaking process. For the 

same reasons set forth in our proposal, 

70 FR at 8896, we continue to believe 

these factors are fulfilled by employing 

the permit review procedures. 

d. Air Quality Related Values Review by 

Federal Land Manager and Permitting 

Authority 

Under an increment approach, we 

consider the review of AQRVs in Class 

I areas by the Federal Land Manager 

(FLM) and State permitting authority to 

be an additional measure that helps to 

satisfy the factors in sections 166(c) and 

160(2) which require that EPA’s PSD 

regulations for NOX protect air quality 

values, and parks and other special 

areas, respectively. In the 1988 

rulemaking addressing PSD for NOX, 

EPA extended the AQRV review 

procedures set forth in sections 

51.166(p) and 52.21(p) to cover NO2. 53 

FR at 3704. These AQRV review 

procedures were established based on 

section 165(d) of the Act, and they were 

originally applied only in the context of 

the statutory increments for PM and 

SO2. However, because they also 

address many of the factors applicable 

under section 166(c) of the Act, EPA 

also applied them to NOX through 

regulation. 

Section 165(d) creates a scheme in 

which the FLM and permitting authority 

must review the impacts of a proposed 

new or modified source’s emissions on 

AQRVs. The Act assigns to the FLM an 

‘‘affirmative responsibility’’ to protect 

the AQRVs in Class I areas. The FLM 

may object to or concur in the issuance 

of a PSD permit based on the impact, or 

lack thereof, that new emissions may 

have on any affected AQRV that the 

FLM has identified. If the proposed 

source’s emissions do not cause or 

contribute to a violation of a Class I 

increment, the FLM may still prevent 

issuance of the permit by demonstrating 

to the satisfaction of the permitting 

authority that the source or modification 

will have an adverse impact on AQRVs. 

Section 165(d)(2)(C). On the other hand, 

if the proposed source will cause or 

contribute to a violation of a Class I 

increment, the permitting authority 

(State or EPA) shall not issue the permit 

unless the owner or operator 

demonstrates to the satisfaction of the 

FLM that there will be no adverse 

59598 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

20Even if such a waiver of the Class I increment 

is allowed upon a finding of no adverse impact, the 

source must comply with such emissions 

limitations as may be necessary to ensure that the 

Class II increment for SO2 or PM is not exceeded. 

Section 165(d)(2)(C)(iv). In 1988, EPA made this 

provision applicable to the PSD provisions for NOX, 

with a cap of 25 μg/m3 ¥ the NO2 Class II 

increment. 53 FR at 3704; 40 CFR 51.166(p)(4) and 

52.21(p)(5). 

21 In response to concerns that Class I increment 

would hinder growth in areas surrounding the Class 

I area, Congress established Class I increments as a 

means of determining where the burden of proof 

should lie for a demonstration of adverse effects on 

AQRVs. See Senate Debate, June 8, 1977 (3 LH at 

725). 

22See S. Rep. 95–127, at 12, reprinted at 3 LH at 

1386, 1410 (describing the goal of protecting ‘‘air 

quality values’’ in ‘‘Federal lands—such as national 

parks and wilderness areas and international 

parks,’’ and in the next paragraph and subsequent 

text using the term ‘‘air quality related values’’ to 

describe the same goal); id. at 35, 36 (‘‘The bill 

charges the Federal land manager and the 

supervisor with a positive role to protect air quality 

values associated with the land areas under the 

jurisdiction of the [FLM]’’ and then describing the 

statutory term as ‘‘air quality related values’’). H.R. 

Report 95–564 at 532 (describing duty of 

Administrator to consider ‘‘air quality values’’ of 

the tribal and State lands in resolving an appeal of 

a tribal or State redesignation, which is described 

in the final bill as ‘‘air quality related values’’). 

impact on AQRVs.20 Thus, the 

compliance with the increment 

determines whether the FLM or the 

permit applicant has the burden of 

satisfactorily demonstrating whether or 

not the proposed source’s emissions 

would have an adverse impact on 

AQRVs.21

In our February 2005 proposal, we 

referred to this process as the ‘‘FLM 

review.’’ However, we recognize this 

term is somewhat of an 

oversimplification because it fails to 

account for the role of the State 

permitting authority. In this final action, 

we more precisely describe this process 

as the review of AQRVs by the FLM and 

permitting authority. 

Incorporating these AQRV review 

procedures into the PSD regulations for 

NOX helps to provide protection for 

parks and special areas (which are 

generally the Class I areas subject to this 

review) and air quality values (which 

are factors considered in the review). As 

we stated in the proposed rule, we 

believe the term ‘‘air quality values’’

should be given the same meaning as 

‘‘air quality related values.’’ Legislative 

history indicates that the term ‘‘air 

quality value’’ was used interchangeably 

with the term ‘‘air quality related value’’

(AQRV) regarding Class I lands.22

Section 166(d) of the CAA provides 

that EPA may promulgate measures 

other than increments to satisfy the 

requirements of section 166. Legislative 

history indicates that the AQRV review 

provisions of section 165(d) were 

intended to provide another layer of 

protection, beyond that provided by 

increments. The Senate committee 

report stated the following: ‘‘A second 

test of protection is provided in 

specified Federal land areas (Class I 

areas), such as national parks and 

wilderness areas; these areas are also 

subjected to a review process based on 

the effect of pollution on the area’s air 

quality related values.’’ S. Rep. 95–127, 

at 4 LH at 1401. 

One commenter asserted that the 

AQRV review process is not effective in 

protecting air quality in national parks 

and wilderness areas because the FLM 

does not have unilateral authority to 

prevent the issuance of a permit when 

it alleges that a proposed new source or 

modification will have an adverse 

impact on an AQRV. We recognize that 

the FLM has the burden to convince the 

permitting authority that there will be 

an adverse impact on AQRVs in 

situations where the proposed project 

will not cause an increment to be 

violated. Nevertheless, we do not agree 

that the effectiveness of this process for 

reviewing impacts on AQRVs is 

diminished simply because the ultimate 

decision to issue or deny a permit does 

not rest with the FLM in all cases. 

While the permitting authority has the 

discretion to disagree with the FLM’s 

analysis, that discretion is not 

unfettered. See In the matter of Hadson 

Power 14—Buena Vista, 4 EAD 258, 276 

(Oct. 5, 1992) (opinion of EPA’s 

Environmental Appeals Board in PSD 

Appeal No. 92–3, 92–4, 92–5). The 

permitting authority must carefully 

consider the FLM’s analysis. If a 

permitting authority is not convinced 

that there will be an adverse impact on 

AQRVs from the proposed facility, the 

permitting authority must provide a 

‘‘rational basis’’ for such a conclusion. 

50 FR 28549 (July 12, 1985); Hadson 

Power at 276. In addition, our visibility 

regulations require that States provide 

an explanation when they disagree with 

an FLM’s conclusion that visibility will 

be adversely impacted. 40 CFR 

51.307(a)(3). The District of Columbia 

Circuit Court has recently observed that 

a State must justify its decision in 

writing when it disagrees with an FLM 

report finding an adverse impact on 

visibility. See National Parks 

Conservation Ass’n v. Manson, No. 04–

5327, slip op. at 8 (D.C. Cir. July 1, 

2005). 

The value of the FLM review 

procedure is that it requires a review of 

impacts on AQRVs by the FLM and 

permitting authority for each project 

that may have an adverse impact on 

AQRVs in a specific, localized area. In 

those cases where the increment is not 

violated and the permitting authority 

agrees that a proposed project will 

adversely affect AQRVs, the parks and 

other special areas will be protected by 

denial of the permit or by requiring the 

applicant to modify the project to 

alleviate the adverse impact. Although it 

is not the final decisionmaker on this 

question in such a situation, the FLM 

plays an important and material role by 

raising these issues for consideration by 

the permitting authority, which in the 

majority of cases will be the State. 

Furthermore, we have not asserted 

that the AQRV review process alone is 

sufficient to satisfy the requirements of 

section 166(c) for NOX. As discussed 

below, we believe the statutory factors 

are fulfilled when the review of AQRVs 

is applied in conjunction with 

increments and other aspects of our PSD 

regulations. 

Several commenters recommended 

that we improve the FLM review 

process by providing specific guidance 

on how to evaluate and manage adverse 

impacts on AQRVs from NOX emissions. 

These commenters called for a more 

specific framework or systematic 

approach for conducting the review of 

impacts on AQRVs and determining 

whether impacts are adverse. Some 

requested that EPA provide more 

definition of the concept of AQRVs and 

circumstances when an AQRV is 

adversely impacted. 

We recognize that the process of 

reviewing impacts on AQRVs is 

somewhat ambiguous because it is 

loosely defined. The CAA does not 

define AQRV, except to note that it 

includes visibility. Section 165(d)(1)(B). 

Some additional insight can be gained 

from the following description in 

legislative history: 

The term ‘‘air quality related values’’ of 

Federal lands designated as class I includes 

the fundamental purposes for which such 

lands have been established and preserved by 

the Congress and the responsible Federal 

agency. For example, under the 1916 Organic 

Act to establish the National Park Service (16 

U.S.C. 1), the purpose of such national park 

lands ‘‘is to conserve the scenery and the 

natural and historic objects and the wildlife 

therein and to provide for the enjoyment of 

the same in such manner and by such means 

as will leave them unimpaired for the 

enjoyment of future generations.’’

S. Rep. 95–127 at 36, reprinted at 3 LH 

at 1410. 

However, we are not prepared at this 

time to provide further definition for 

these concepts in this rulemaking action 

for pollutant-specific PSD regulations 

for NOX. We believe the existing AQRV 

review process provides the avenue to 

satisfy the factors applicable under 

section 166(c) of the Act in conjunction 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59599 

23We have paraphrased these factors here and in 

other sections to facilitate the explanation of our 

reasoning. However, we recognize that the statutory 

language is broader than the shorthand we use here 

for convenience. 

with other aspects of our PSD 

regulations. 

The AQRV review process applies to 

SO2 and PM as well, and thus is broader 

than the scope of this rulemaking for 

NOX. We have been engaged in a 

separate action to consider refinements 

to the AQRV review process. In 1996, 

the Agency, among other refinements, 

proposed the following definition of 

AQRV: 

* * * visibility or a scenic, cultural, 

physical, biological, ecological, or 

recreational resource that may be affected by 

a change in air quality, as defined by the 

Federal Land Manager for Federal lands, or 

by the applicable State or Indian Governing 

Body for nonfederal lands. 

61 FR 38250, 38322 (July 23, 1996). 

However, we have not reached the 

closure on the evaluation of these 

issues. We will continue to work with 

Federal land management agencies and 

consult with States and other 

stakeholder groups on potential reforms 

to the AQRV review process, including 

evaluating the potential of a critical 

loads approach, as discussed in section 

VII of this preamble. 

e. Additional Impacts Analysis 

The additional impacts analysis set 

forth in our regulations also helps fulfill 

the criteria and goals and purposes in 

sections 166(c) and 160. The additional 

impacts analysis involves a case-by-case 

review of potential harm to visibility, 

soils, and vegetation that could occur 

from the construction or modification of 

a source. 

Sections 51.166(o)(1) and 52.21(o)(1) 

of the PSD regulations require that a 

permit provide the following analysis: 

an analysis of the impairment to visibility, 

soils and vegetation that would occur as a 

result of the source or modification, and 

general commercial, residential, industrial 

and other growth associated with the source 

or modification. The owner or operator need 

not provide an analysis of the impact on 

vegetation having no significant commercial 

or recreational value. 

This requirement was based on 

section 165(e)(3)(B) of the CAA, which 

provides that EPA establish regulations 

that require ‘‘an analysis of the ambient 

air quality, climate and meteorology, 

terrain, soils and vegetation, and 

visibility at the site of the proposed 

major emitting facility and in the area 

potentially affected by emissions from 

such facility * * *’’ 42 U.S.C. 

7475(e)(3)(B). 

This portion of the additional impacts 

analysis is especially helpful for 

satisfying the requirements of section 

166(c) in Class II and Class III areas. 

These areas are not subject to the 

additional AQRV review that applies 

only in Class I areas. We agree with the 

commenter who pointed out that our 

regulations under section 166 must also 

provide protection for Class II and Class 

III areas. While not as intensive a review 

as the AQRV analysis required in Class 

I areas, the consideration of 

impairments to visibility, soils, and 

vegetation through the additional 

impacts analysis contributes to the 

satisfaction of the factors applicable 

under section 166(c) of the CAA in all 

areas, including Class II and Class III 

areas. 

f. Installation of Best Available Control 

Technology 

The requirement that new sources and 

modified sources subject to PSD apply 

BACT is an additional measure that 

helps to satisfy the factors in sections 

166(c), 160(1), and 160(2) of the Act. 

This requirement, based on section 

165(a)(4) of the CAA, is included in 

EPA’s PSD regulations and thus is also 

part of the regulatory framework for the 

Agency’s pollutant-specific regulations 

for NOX. 40 CFR 52.21(j); 40 CFR 

51.166(j). Our existing regulations 

define ‘‘best available control 

technology’’ as ‘‘an emission limitation 

* * * based on the maximum degree of 

reduction for each pollutant subject to 

regulation under the Act * * * which 

the Administrator, on a case-by-case 

basis, taking into account energy, 

environmental, and economic impacts 

and other costs, determines is 

achievable for such source through 

application of production processes or 

available methods, systems, and 

techniques * * *.’’ 40 CFR 52.21(b)(12); 

40 CFR 52.166(b)(12). This pollutant 

control technology requirement is 

rigorous and in practice has required 

significant reductions in the pollutant 

emissions from new and modified 

sources. The control of NOX emissions 

through the application of BACT helps 

to protect air quality values, public 

health and welfare, and parks and other 

special areas. 

2. Characteristics of Increments for NOX

Because EDF v. EPA concerned 

certain characteristics of the increments 

for NOX that we had established in 

1988, we sought comments in our 

proposal on the possible need to (1) 

create additional increments for forms 

of NOX other than NO2 alone; (2) 

promulgate additional increments for an 

averaging period other than the existing 

annual period, i.e., ‘‘short-term’’

increments; and (3) increase the 

stringency of the existing NO2

increments by lowering the allowable 

levels. Several commenters opposed our 

proposal to retain the annual NO2

increments at existing levels for all area 

classifications. However, many 

commenters supported the existing 

increments, believing that they provide 

adequate environmental protection and 

meet the requirements of section 166(c) 

of the Act. 

The majority of commenters that 

opposed retaining the existing 

increments recommended we adopt 

various alternatives to the existing NO2

increments, including new short-term 

increments, increments measured by a 

different form of NOX, and the use of 

critical loads in lieu of the present 

increment system. A few commenters 

felt that the existing levels of the 

increments are not adequate to protect 

the environment but did not 

recommend specific ways to change 

them. One commenter supported the 

existing increments but recommended 

that EPA enact additional mechanisms 

for protecting AQRVs in Class I areas. 

Two commenters supported revising 

and retaining the increment system on 

an interim basis but then emphasized 

the need for additional studies to 

ultimately improve the PSD program for 

NOX by switching to a critical loads 

approach. 

After considering these comments, we 

have decided to retain the existing 

increments for NOX without any of the 

changes recommended by commenters. 

We have not been persuaded by 

comments (including the information 

contained in studies provided by the 

commenters) that there is sufficient 

basis for EPA to modify the ‘‘safe 

harbor’’ increments. Thus, we are 

retaining annual NO2 increments for 

each area classification with a level 

based on the same percentages of the 

NAAQS Congress employed to establish 

the SO2 increments. As a result, the 

Class I increment for NO2 remains at 2.5 

μg/m3 (annual average). The Class II 

increment for NO2 is 25 μg/m3 (annual 

average) and the Class III increment for 

NO2 is 50 μg/m3 (annual average). 

In evaluating the level, averaging 

period, and form of increments for NOX, 

we applied the following four factors 

applicable under section 166(c): (1) 

Protect air quality values; (2) protect 

public health and welfare from adverse 

effects from air pollution that occur 

even when the air quality meets the 

NAAQS; (3) protect air quality in parks 

and special areas; and (4) ensure 

economic growth consistent with 

preservation of clean air resources.23

59600 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

24The required reductions in NOX emissions will 

also result in substantial visibility improvements 

and reductions in nitrogen deposition in many parts 

of the eastern United States. 

25When the visibility provisions were enacted, 

the House committee report specifically recognized 

that the ‘‘visibility problem is caused primarily by 

emission into the atmosphere of sulfur dioxide, 

We continue to believe that the other 

four factors identified in sections 166(c) 

and 160 of the Act do not relate to the 

level, time period, and form of the 

increments and thus are more 

appropriately considered when 

determining the overall framework for 

PSD regulations. Since we believe that 

those other factors are satisfied by the 

increment and area classification 

framework and other measures 

contained within our PSD regulations, 

we do not believe that it is necessary to 

further consider those other four factors 

when evaluating the characteristics of 

increments of NOX. 

a. Fundamental Elements of Increments 

In the proposal, we described three 

elements which we believed were 

fundamental to the PSD increments 

under the regulatory framework 

established by Congress. We considered 

these elements in determining whether 

to modify the existing increments. First, 

an increment represents an allowable 

marginal increase in ambient air 

pollution concentrations resulting from 

increases in the emissions of a 

particular pollutant after the ‘‘baseline’’

date in the affected PSD area. Second, 

increments are not intended to remedy 

the effects of pre-existing sources of 

pollution in attainment areas, but rather 

prevent excessive growth in emissions 

in these areas that already have ambient 

air pollution levels below the NAAQS. 

The third fundamental element of 

increments is that they are intended to 

allow the same level of growth in each 

area with a particular classification and 

thus should be uniform across the 

nation for each area classification. Most 

commenters did not question these 

fundamental elements of increments, 

but some concerns were raised. 

(1) Marginal level of increase. 

Increments represent the maximum 

allowable level of pollutant 

concentration increase in an area where 

the air quality is in attainment with the 

NAAQS or has been designated 

‘‘unclassifiable.’’ Thus, an increment is 

essentially a marginal level of increase 

in air pollution that is allowable for 

particular areas. The statutory 

increments are expressed as ambient 

concentrations rather than mass values. 

An increment differs from the NAAQS 

in that an increment is not an absolute 

air quality ceiling. The pollutant 

increase allowed by an increment is 

added to the ‘‘baseline’’ air pollution 

levels existing in an affected PSD area 

at the time a new or modified major 

source submits an application for a PSD 

construction permit. Thus, in applying 

the factors applicable under section 

166(c), we interpreted section 166 of the 

Act to require an analysis of the impacts 

on air quality values, health and 

welfare, and parks and special areas that 

could occur as a result of some marginal 

increase in the concentration of air 

pollution in an area. 

As noted earlier, EPA does not 

interpret the PSD program to require it 

to set increments at a level where there 

will be no negative effects from a 

marginal increase in air pollution in the 

amount of the increment. Congress did 

not anticipate that an increment would 

be a level of increase below which there 

would be no negative effects. An 

increment is the level that defines 

‘‘significant’’ deterioration; it allows 

some deterioration of air quality. The 

PSD program allows for some increase 

in effects when necessary to ensure that 

economic growth may continue to occur 

consistent with the preservation of clean 

air resources. 

(2) Increments need not remedy 

existing air pollution. Because an 

increment is an allowable level of 

increase, it does not function to reduce 

air pollution in existence before the 

baseline dates. As its name indicates, 

the PSD program is intended to protect 

against significant deterioration of the 

air quality in attainment and 

unclassifiable areas from the 

construction and operation of new and 

modified sources of a particular size. 

Thus, the PSD program limits increases 

in emissions of a pollutant (as measured 

by the increase in ambient 

concentrations of the pollutant) but does 

not seek to reduce existing emissions or 

ambient air pollutant concentrations to 

a particular level. 

Several commenters seemed to 

suggest that the increment system 

should somehow be designed to 

improve the air quality to remedy 

existing effects. However, we believe it 

is clear that the increments established 

by Congress were only intended to 

define the allowable levels of marginal 

increase in air pollution above a 

baseline concentration that are 

established in each area when the first 

major source applies for a PSD permit 

in that area. 42 U.S.C. 7479(4). As a 

result, we do not believe we are 

required to set increments at a level 

intended to alleviate existing negative 

effects. 

When we evaluated the characteristics 

of increments necessary to prevent 

significant deterioration of air quality, 

we also recognized that EPA has 

adopted several other programs under 

the CAA that reduce the adverse effects 

from existing air pollution sources. 

These programs are designed to reduce 

emissions from existing sources, while 

the increments serve the complementary 

function of limiting increases in 

emissions from the construction of new 

major sources and the modification of 

existing ones. Since our proposal, EPA 

has taken a series of actions that require 

States to achieve substantial reductions 

in NOX emissions. 

On March 10, 2005, EPA finalized the 

CAIR (70 FR 25162, May 12, 2005), 

which requires substantial emissions 

reductions of SO2 and NOX from sources 

in 28 eastern States and the District of 

Columbia to help downwind PM2.5 and 

8-hour ozone nonattainment areas 

achieve the NAAQS. Under this 

program, emissions of NOX are 

regulated as a precursor of either ozone 

or fine PM, or both. EPA is requiring the 

affected States to submit revised SIPs 

that include control measures to reduce 

emissions of NOX to assist in achieving 

the NAAQS.24 This program is based on 

State obligations to address interstate 

transport of pollution under section 

110(a)(2)(D) of the Act. The required 

NOX reductions must be implemented 

by the States in two phases, with the 

first phase beginning in 2009 (covering 

2009–2014) and the second phase 

beginning in 2015. The EPA estimates 

that the two-phase CAIR program will 

reduce NOX emissions by a total of 2 

million tons from 2003 emissions levels. 

Reduction of NOX emissions from 

existing sources is also required under 

EPA’s 1998 NOX SIP Call, which also 

addresses State obligations to address 

interstate transport of pollution. The 

NOX SIP Call requires 22 eastern States 

and the District of Columbia to submit 

SIP revisions that prescribe NOX

emissions reductions by a specified 

deadline. The EPA has projected that 

approximately 900,000 tons of NOX per 

ozone season will be reduced as a result 

of this particular program. While these 

reductions are intended primarily to 

improve air quality in the East with 

respect to ozone, it is clear that the 

required decreases in NOX emissions 

will also decrease acid deposition, 

nitrogen loadings to aquatic and 

terrestrial ecosystems, and ambient 

concentrations of NO2. 

In addition, EPA has taken further 

action to reduce NOX emissions from 

existing sources that contribute to 

visibility problems, through 

implementation of the Regional Haze 

program under sections 169A and 169B 

of part C.25 On July 6, 2005, EPA issued 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59601 

oxides of nitrogen, and particulate matter * * *’’

H.R. Rep. 95–294, at 204, reprinted in 4 LH at 2671. 

NOX may result in visibility impairment either 

locally (a coherent plume effect) or by contributing 

to regional haze, which has been recognized as 

primarily a fine particle phenomenon. 1995 Staff 

Paper for NOX at 89. For the reasons discussed 

earlier, we do not believe we need to consider PM 

effects in this court-ordered reevaluation of the NO2

increments. 

26Congress also recognized that some areas may 

have air pollution levels already near the levels 

allowed by the applicable NAAQS, whereby the 

NAAQS would govern and the full amount of 

increment might not be usable. 

revised regulations for regional haze, 

including guidelines for Best Available 

Retrofit Technology (BART) 

determinations. The regulations require 

States to submit SIPs to address regional 

haze visibility impairment in 156 

mandatory Class I Federal areas located 

throughout the U.S. 70 FR 39104. As 

required by the Act, the regulations 

require certain major stationary sources, 

placed in service between August 7, 

1962 and August 7, 1977, and which 

emit 250 tons or more per year of a 

visibility-impairing pollutant, including 

NOX, to undergo a BART analysis. 

The BART requirements are in 

addition to other elements of the 

Regional Haze program in regulations 

that EPA originally promulgated in 

1999. 64 FR 35714 (July 1, 1999) 

(‘‘Regional Haze rule’’). The main 

components of this rule require States 

to: (1) Submit SIPs that provide for 

‘‘reasonable progress’’ toward achieving 

‘‘natural visibility conditions’’ in Class 

I areas; (2) provide for an improvement 

in visibility in the 20 percent most 

impaired days; (3) ensure no 

degradation in visibility occurs on the 

20 percent clearest days; and (4) 

determine the annual rate of visibility 

improvement that would lead to 

‘‘natural visibility’’ conditions in 60 

years. 

At the time that Congress established 

the Regional Haze Program, a 

Congressional committee recognized 

that the PSD program was not 

necessarily created to alleviate adverse 

effects resulting from contributions by 

existing sources. When it was writing 

section 169A of the Act at the same time 

that it established the PSD program, the 

House recorded the following 

observations in a committee report: 

[T]he committee recognizes that one 

mechanism which has been suggested for 

protecting these areas, the mandatory Class I 

increments of new section 160 (‘Prevention 

of Significant Deterioration’) do not protect 

adequately visibility in Class I areas. First, 

inadequately controlled, existing gross 

emitters such as the Four Corners plant 

would not be affected by the significant 

deterioration provisions of the bill. Their 

emissions are part of the baseline, and would 

not be required to be reduced by new section 

160 of the act. 

H. Rep. 95–294, at 205, 4 LH at 2672 

(emphasis added). This statement 

indicates that protection of air quality 

values under section 166(c) is provided 

when an increment limits significant 

deterioration of air quality resulting 

from increases in emissions after the 

baseline date, but does not require an 

increment that addresses adverse 

impacts on air quality values, such as 

visibility, that are caused by pre-existing 

emissions. 

In addition, in the 1990 Amendments, 

Congress enacted title IV to address the 

problem of acid deposition. We believe 

this supports an interpretation that the 

PSD measures called for in section 166 

need not address acid deposition 

impacts that are attributed to emissions 

that existed prior to the baseline date. 

When we use an increment approach, 

our view is that the PSD program is 

intended to focus on establishing a 

marginal level of increase in emissions 

that will prevent significant air quality 

deterioration and, in conjunction with 

AQRVs identified by the FLM, provide 

protection against increases in adverse 

effects, such as acidification, that may 

result from emissions increases after the 

baseline date. 

Thus, in areas where the PSD baseline 

has not yet been established, the 

emissions reductions achieved by these 

programs will result in lower PSD 

baseline concentrations. Then the 

increments will operate as an allowable 

level of marginal increase that prevents 

the significant deterioration of air 

quality beyond the baseline 

concentration in these attainment areas. 

This approach is consistent with 

Congressional intent that the baseline 

concentration, representing the air 

quality in an attainment area subject to 

PSD, be established on the date of the 

first application for a permit by a PSD 

source affecting that area. 42 U.S.C. 

7479(4). See also Alabama Power v. 

Costle, 606 F.2d 1068, 1088–89 (D.C. 

Cir. 1979). 

(3) Increments should be uniform for 

each area classification. Several 

commenters disagreed with our view 

that the increments should be uniform 

throughout the U.S. in each area with 

the same classification. These 

commenters argued that uniform 

national standards are not required by 

the Act. We continue to believe that the 

PSD program is intended to allow the 

air quality in each area of the country 

attaining the NAAQS, and with the 

same area classification, to ‘‘deteriorate’’

by the same amount for each subject 

pollutant, regardless of the existing air 

quality when the increment is initially 

triggered in a particular area, as long as 

such growth allowed within the 

constraints of the increment does not 

cause adverse impacts on site-specific 

AQRVs or other important values.26 In 

this way, the PSD increments avoid 

having a disproportionate impact on 

growth that might disadvantage some 

communities, recognizing that the 

increments in themselves would not 

address existing negative impacts but 

cannot allow significant new adverse 

impacts. Congress established the 

foundation for uniform national 

increments when it created increments 

for SO2 and PM under section 165 of the 

Act. 

Thus, when we use the framework of 

an increment and area classification 

system in the national PSD regulations 

for a particular pollutant, we believe 

that we should establish a single 

increment for each class of area such 

that this allowable level of increase 

applies uniformly to all areas in the 

nation with that particular 

classification. This is necessary for EPA 

to ensure equitable treatment by 

allowing similar levels of emissions 

growth for all regions of the country that 

a State elects to classify in a particular 

manner. The following statement from 

the legislative history of the PSD 

program supports this interpretation of 

what Congress intended: 

Some suggestions were made that the 

pollution increments should be calculated as 

a function of existing levels of pollution in 

each area. But the inequities inherent in such 

an approach are readily evident * * *. The 

committee’s approach—increments 

calculated as a percentage of the national 

standard—eliminates those inequities. All 

areas of the same classification would be 

allowed the same absolute increase in 

pollution, regardless of existing levels of 

pollution. 

H. Rep. 95–294, at 153, 4 LH at 2620. 

See also S. Rep. 95–127, at 30, 3 LH at 

1404 (‘‘These increments are the same 

for all nondeterioration areas, thus 

providing equity for all areas’’). This 

indicates that Congress did not intend to 

impose more stringent restrictions 

under the PSD program on particular 

areas of the country based on their 

current levels of air pollution, unless, of 

course, the current levels of pollution 

concentrations are so near the NAAQS 

that the full amount of incremental 

change cannot be allowed. 

Instead, Congress provided States 

with the authority to determine 

situations when it might be desirable to 

allow a greater or lesser level of air 

quality protection in a particular area. 

Except for certain Federal lands 

designated as mandatory Class I areas 

59602 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

that could not be reclassified, Congress 

classified all other areas as Class II areas 

and gave the States the power to 

reclassify these areas to Class I or Class 

III to provide for greater protection of air 

quality or allow more growth, 

depending on the values of the State 

and the community in that area. The 

ability to reclassify most areas allows 

the States to make their own choices 

about which areas require more 

protection of air quality and which areas 

should be allowed more growth 

consistent with the protection of air 

quality. See H.R. Rep. 95–294, at 153–

154, 4 LH at 2620–2621. 

The same equitable considerations are 

applicable when we establish PSD 

regulations containing increments and 

area classifications under section 166 of 

the Act. Since Congress did not intend 

for the increments it established to 

impose a disproportionate impact on 

particular areas, we do not believe it 

intended for EPA to do so under section 

166 of the Act. Thus, to treat all areas 

of the country in an equitable manner, 

it is necessary for us to establish 

uniform national increments for NO2

that define a maximum allowable 

increase for each of the three area 

classifications. Then, States and tribes 

in exercising their unique authority to 

manage their own air quality, in 

accordance with their own unique and 

individual goals and objectives, may 

decide how to best manage their air 

quality resources by reassigning area 

classifications within any particular 

area (other than mandatory Federal 

Class I areas). 

Some of the commenters opposing 

uniform national increments disagreed 

with our view that the increments 

should be uniform because they felt we 

improperly focused on ‘‘providing equal 

opportunity for new emission sources 

without fulfilling [our] statutory duty to 

protect ecological resources across the 

country.’’ What is required, according to 

these commenters, is ‘‘the protection of 

air quality related values and fulfillment 

of the Act’s goals and purposes—which 

unquestionably include protection of 

individual parks, wilderness areas, and 

other areas of important value.’’

Moreover, these commenters argued that 

because of our insistence on the use of 

uniform increments no amount of 

information would ever provide a 

‘‘nationally applicable’’ basis for EPA to 

revise the NO2 increments, because, as 

EPA recognizes, ‘‘the sensitivity of 

individual ecosystems varies greatly’’

across locations. 

We do not believe that our position 

supporting uniform national increments 

under the national PSD program 

necessarily conflicts with our 

responsibility to protect sensitive 

ecological resources located throughout 

the U.S. The use of uniform national 

increments—only one component of the 

PSD regulations for NOX—does not 

mean that the PSD program is not 

responsive to different levels of adverse 

effects in particularly sensitive areas, 

such as Class I areas. 

We weighed Congress’ goal to treat all 

areas with a particular classification the 

same against the unique variability in 

ecosystem effects that may result from 

NOX emissions (described elsewhere in 

this preamble). We ultimately 

concluded that multiple goals could be 

achieved by retaining uniform national 

increments for NO2 for each area 

classification and augmenting them 

with an additional case-by-case 

procedural review which can identify 

and protect against variable effects that 

could occur in especially sensitive 

areas, even when the increment is not 

fully consumed. Indeed, this is what 

Congress did under its original PSD 

program requirements for SO2 and PM. 

This approach is embodied in the 

framework for the PSD regulations for 

NOX that we adopted in 1988. As 

described in section VI.A.1. above, each 

permit application is subject to an 

‘‘additional impacts’’ analysis that 

allows the permitting authority to 

consider the sensitivity of a particular 

area. In Class I areas, the AQRV review 

procedures provide further protection, 

notwithstanding the allowable amount 

of pollutant concentration increase 

allowed by the Class I increment, for the 

air quality values and the national parks 

and wilderness areas included in Class 

I areas. These two sets of special 

procedures are an important part of the 

overall regulations for preventing 

significant air quality deterioration, 

while retaining the uniform national 

increments. This approach allows EPA 

to achieve the equity of setting a 

uniform increment level for all areas 

with a particular classification, while 

directing that permitting authorities 

conduct a more intensive, site-specific 

review to identify effects that might 

occur in a more sensitive area but not 

necessarily in all areas of the country 

with that classification. 

As noted earlier, we read section 166 

of the Act to direct EPA to establish a 

system of regulations containing 

provisions that collectively satisfy the 

content requirements in sections 166(c) 

and 166(d) of the Act. Thus, we think 

Congress contemplated that we would 

consider all the provisions in our 

regulations as a group when establishing 

particular aspects of those regulations. 

As a result, we believe it is appropriate 

and consistent with our statutory 

obligations to consider the protection 

provided by the additional impacts 

analysis and the review of AQRVs in 

Class I areas when establishing 

increments. 

We also believe that the factors 

applicable under section 166(c) of the 

Act are met when we establish a 

uniform national increment for NO2 for 

each class of area and augment the 

increment system with an additional 

case-by-case procedural review to 

identify and protect against variable 

adverse effects that could occur in 

especially sensitive areas before the 

amount of pollutant increase defined by 

the increment is reached. 

We, nevertheless, understand the 

commenters’ concern over our position 

that the increments should be uniform, 

when they conclude that no amount of 

evidence concerning ecological effects 

will be useful for revising the 

increments, because of the highly 

variable sensitivity of ecosystems 

throughout the U.S. While we have 

indicated that it would be very difficult 

to use such variable data to modify the 

increments as uniform increments, we 

believe it may be possible to develop 

uniform increments that provide for a 

reasonable level of protection in most 

areas if sufficient national critical loads 

data are available to determine the range 

of adverse effects that must be 

considered. Clearly, such extensive data 

are not available at this time. 

Some commenters argued that we 

should establish local standards under 

section 166 to address the known 

variable effects from NOX. For the most 

part, however, the comments related to 

the use of a critical loads approach 

rather than a set increment or variable 

increments for NOX. In either case, 

however, because of the equitable 

considerations and State prerogatives to 

classify areas described above, we do 

not believe that Congress intended for 

EPA to create a federally imposed 

system of regional or locally based 

increments or to authorize EPA to do so 

to address any variability in potential 

effects. Likewise, we do not believe it is 

permissible or appropriate for us to 

establish uniform increments at levels 

so stringent that they prevent any 

adverse impact on the most sensitive 

receptors in any part of the U.S. 

Although such an approach might 

achieve uniformity across all areas, it 

would unduly restrict growth in those 

areas of the country where adverse 

effects may not occur at the levels where 

the adverse effects occur in more 

sensitive areas. 

Furthermore, our regulations also 

provide protection against localized 

impacts by requiring each new or 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59603 

modified source subject to PSD to apply 

BACT. The BACT requirement provides 

for a case-by-case State determination, 

taking into account energy, 

environmental, and economic impacts 

and other costs to determine the best 

method for minimizing a source’s 

emissions. See section 169(3) of the Act. 

b. Analytical approaches for 

establishing increments. Mindful of the 

above considerations about the 

characteristics of the increments, we 

reviewed the scientific and technical 

evidence available for the 1996 review 

of the NO2 NAAQS in order to 

determine whether, and to what extent, 

the ‘‘safe harbor’’ increments should be 

modified to satisfy sections 166(c) and 

160 of the Act. As summarized in 

section V of this preamble, EPA’s 

conclusions about whether nitrogen at 

levels at or below the NAAQS caused 

negative environmental impacts were 

mixed, but included findings that 

negative effects associated with nitrogen 

deposition (1) did not likely exist (e.g., 

eutrophication of freshwater systems); 

(2) were insignificant (e.g., impacts on 

terrestrial vegetation); or (3) not clearly 

understood (e.g., chronic and episodic 

acidification). There was some evidence 

that at levels below the NAAQS, 

nitrogen was at least in part contributing 

to known negative environmental 

effects. Ultimately, we tried two 

different analytical approaches—a 

quantitative and a qualitative 

evaluation—to reach our decision about 

whether we had a basis for modifying 

the safe harbor NO2 increments so that 

the increments themselves could 

provide greater protection against such 

adverse effects. These approaches and 

the relevant findings are described 

below. 

(1) Quantitative Evaluation. An 

increment is not like the NAAQS in that 

it does not set a uniform pollutant 

concentration ‘‘ceiling’’ against which 

potential negative ecosystem responses 

could be evaluated. Instead, an 

increment allows a uniform allowable 

pollutant concentration increase above a 

baseline concentration in an area. 

Therefore, we evaluated how protective 

the existing NO2 increments are by 

trying to compare the maximum 

pollutant concentration increases 

allowed by the NO2 increments against 

the pollutant concentrations at which 

various environmental responses occur. 

See 70 FR 8900. 

Unfortunately, this quantitative 

approach was hindered because the 

available evidence we reviewed 

typically was inconclusive regarding the 

pollutant concentrations at which 

negative environmental responses 

associated with NOX could be expected 

to occur. As described in section V, in 

many instances, there was uncertainty 

about the specific relationship between 

the pollutant, NO2, and its precise role 

in causing a particular negative 

response to an environmental receptor. 

The Agency encountered the same 

problem in the past during the last 

periodic review of the NO2 NAAQS. 

Because of our inability to derive from 

the available evidence a way to quantify 

how much of a contribution 

atmospheric deposition of nitrogen is 

making to negative environmental 

effects and what levels of reduction are 

necessary to remedy the situation, we 

were precluded from recommending 

secondary (welfare-based) NAAQS for 

NOX. See 1995 Staff Paper for NOX, vol. 

1, pp. 91–95. For similar reasons, we 

could not quantitatively identify the 

level of increase in NOX emissions at 

which significant negative 

environmental effects occur. Thus, we 

do not have a quantitative way to 

determine whether or how to modify the 

existing NO2 increments in order to 

prevent significant deterioration. 

Recognizing the inconclusive nature 

of the scientific and technical evidence 

contained in the 1993 Criteria 

Document, we looked beyond that 

information to later studies that might 

provide the information we needed to 

determine the quantitative doseresponse relationships associated with 

NOX in the atmosphere. We found that 

later studies enable us to better 

understand N deposition trends, the 

mechanisms by which NOX contributes 

to N deposition, and the ways in which 

sensitive ecosystem resources respond 

to excess nitrogen. However, even in the 

later studies, there continues to be 

significant uncertainty about the 

quantitative dose-response relationships 

that we need to evaluate the 

effectiveness of the existing NO2

increments. 

Some commenters saw the later 

studies, which provide evidence of 

increased levels of N deposition in some 

areas of the U.S., and scientific findings 

more closely linking nitrogen deposition 

to observed negative ecosystem 

responses as ‘‘proof’’ that the existing 

NO2 increments are ineffective. We 

disagree with the commenters’ claims 

that evidence of localized impacts in 

specific sensitive areas, as reflected in 

later studies, necessarily proves that the 

existing NO2 increments across the U.S. 

are ineffective. It is not clear at this time 

whether a lower, more stringent 

increment level that we might select for 

the national uniform increments would 

prevent the adverse effects that are 

currently being observed in a particular 

park or sensitive area of the U.S. We 

have already acknowledged that 

increments are not intended to prevent 

all negative impacts in all areas, and 

that the PSD regulations for NOX

contain other mechanisms for protecting 

sensitive resources where the increment 

alone does not do so. 

We cannot deny the commenters’

claims that some areas of the U.S. 

(primarily in the West) have continued 

to experience increased rates of N 

deposition, as studies have shown. 

However, such information does not 

change the fact that we are currently 

unable to find sufficient evidence upon 

which to establish a dose-response 

relationship associated with NOX so that 

we can scientifically support more 

stringent numerical levels for the NO2

increments should we otherwise 

conclude that a modification is 

appropriate. Instead, as mentioned 

above, most published studies have still 

largely focused on documenting the 

adverse effects and making links to N 

deposition as a primary cause. These 

studies typically fall short of defining a 

quantitative relationship between 

emissions of NOX, N deposition rates, 

and the negative responses being 

observed. 

There are many recent studies that 

examine the various sources of the 

nitrogen input (industry, transportation, 

agriculture), N deposition budget, 

geographical location of different 

nitrogen loadings, and trends in 

deposition rates, as well as the specific 

effects of nitrogen deposition on specific 

ecosystems. These studies in general 

emphasize the importance of reducing 

current emissions of NOX as part of a 

strategy for reducing observed impacts 

and promoting ecosystem recovery. 

However, such studies are not yet able 

to provide the information needed to 

identify the dose-response relationships 

associated with NOX. 

There are several key difficulties 

associated with the ability to establish a 

quantitative relationship between NOX

and the negative environmental 

responses to which nitrogen compounds 

are known to contribute. Below, we 

summarize some of the key areas of 

difficulty for which a better 

understanding is needed. 

(1) Relationship between NOX

emissions and N deposition. It is 

generally recognized that reducing NOX

emissions will result in reductions in N 

deposition as well. However, the 

quantitative relationship between the 

two is complex and still uncertain. 

Some recent studies attempt to address 

the various parameters that together 

could help to establish this relationship. 

For example, some recent study results 

provide evidence of a quantitative 

59604 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

relationship between NOX emissions 

and precipitation (wet deposition) NO3

in the eastern U.S. However, the results 

of efforts to establish a quantitative 

relationship between NOX emissions 

and total (wet and dry) nitrogen 

deposition have thus far been 

inconclusive (Butler, 2000, 2003). These 

studies point to the reactive nature of 

components of NOX as being part of the 

problem. Besides producing nitric acid 

or nitrate aerosols, both components of 

N deposition, NOX can also result in the 

formation of peroxyacetyl nitrates 

(PAN), ozone and other oxidant species. 

Also, it has been observed that high 

year-to-year variability in N deposition 

does not match the relatively small total 

NOX emissions changes in the eastern 

U.S. 

(2) Nitrogen deposition budget. 

Another complication is that total N 

deposition typically includes the 

combined contributions of emissions 

from NOX (which form nitrates and 

nitric acid in the atmosphere) and 

ammonia (ammonium). Emissions of 

ammonia can be converted to any other 

nitrogen species and can contribute to 

all nitrogen-related inputs. (Ammonia 

Workshop, 2003.) Ammonia and 

ammonium found in the atmosphere, 

and in the soil, are generally the result 

of agricultural activities that are neither 

regulated directly by the PSD program 

nor counted towards the consumption 

of the NO2 increment (and would not be 

counted against the increment for NOX

measured as any other form of NOX). In 

order to better understand the 

relationship between the different 

sources of nitrogen and the ecosystems 

affected, it is important to also recognize 

contributions from ammonia and 

ammonium. 

One challenge with understanding the 

contributions from different nitrogen 

species is that the mix of pollutant 

inputs that affect sensitive ecosystems is 

dynamic. A 2005 report using data from 

the National Atmospheric Deposition 

Program National Trends Network has 

shown that from 1985 to 2002 marked 

changes in concentrations of sulfate, 

nitrate and ammonium in wet 

deposition have occurred. The reported 

trends indicate ‘‘changes in the mix of 

gases and particles scavenged by 

precipitation, possibly reflecting 

changes in emissions, atmospheric 

chemical transformations, and weather 

patterns.’’ (Lehmann, 2005.) 

In some areas of the country, for 

example, it is reported that emissions of 

ammonia are increasing at a greater rate 

than emissions of NOX. At the same 

time, atmospheric ammonium 

concentrations in wet deposition are 

increasing at a greater rate than are 

nitrate concentrations (Fenn, 2003a). 

The same study indicated that NOX

emissions in the western U.S. are 

projected to decrease 28 percent by 

2018, while ammonia emissions are 

projected to increase by 16 percent. 

Another study reports the occurrence of 

significant increases of ammonia and 

dissolved inorganic nitrogen in much of 

the U.S., while reporting regionally 

significant increases and decreases in 

nitrate. (Lehmann, 2005.) 

Another challenge is that in many 

areas, particularly in the West, the 

accuracy of the inventory for ammonia 

is very uncertain, and historic 

deposition monitoring (collected mainly 

in the form of wet deposition) typically 

has not included the ammonia 

component. (Fenn, 2003a.) This leads to 

problems in estimating total N 

deposition. 

We believe that a better 

understanding of ammonia emissions 

and the ammonia levels in the 

atmosphere, and their contribution to 

total N deposition, is also needed in 

order to obtain a more complete picture 

of the atmospheric partitioning of N 

emissions and total mass of N 

deposition. This will help us better 

understand the dose-response 

relationships between the different 

sources of nitrogen and the ecosystems 

affected by them. 

Finally, the N deposition budget and 

associated deposition rates are 

determined by a complex interaction of 

multiple processes. Modeling efforts to 

simulate the formation and deposition 

of nitrogen species in the West involve 

a number of data inputs including 

emissions of nitrogen from various 

sources of NOX and ammonia, 

meteorological parameters, chemical 

transformation and partitioning of 

nitrogen species, aerosol dynamics, and 

rates of wet and dry deposition. (Fenn, 

2003a.) 

(3) Ecosystem variety and sensitivity. 

Even if a particular threshold value 

could be identified to quantifiably relate 

ambient NOX concentrations to an 

adverse effect in a given ecosystem and 

location, the same threshold is not 

likely to apply to similar ecosystems 

throughout the U.S. In our most recent 

review of the NO2 NAAQS, we observed 

that ‘‘a great degree of diversity exists 

among ecosystem types, as well as in 

the mechanism by which these systems 

assimilate nitrogen inputs.’’ 60 FR 

52831, October 11, 1995 at 52881. As a 

result, we concluded, ‘‘the relationship 

between nitrogen deposition rates and 

their potential environmental impact is 

to a large degree site- or region-specific 

and may vary considerably over broader 

geographical areas or from one system to 

another because of the amount, form, 

and timing of nitrogen deposition, forest 

type and status, soil types and status, 

the character of the receiving 

waterbodies, the history of land 

management and disturbances across 

the watersheds and regions, and 

exposure to other pollutants.’’ Id. 

A 2005 paper describes the progress 

being made by FLMs in identifying the 

resources that are at risk or sensitive to 

air pollution in the parks and 

wilderness areas under their 

jurisdiction. (Porter, 2005.) Reportedly, 

the FLMs have also completed 

qualitative descriptions of the various 

resources. It is noted that such 

information is ‘‘specific to each 

wilderness area or park, because of the 

tremendous diversity in ecosystem 

characteristics, sensitivities, and 

stressors on federal lands.’’

Thus, for example, ecosystems in the 

Northeast have been more strongly 

affected by acid deposition than have 

ecosystems in the western U.S. On the 

other hand, the problem of greater 

concern in the West results from 

nitrogen enrichment, which includes 

nitrogen saturation, eutrophication and 

alterations in biological communities. In 

addition, some areas in the West are 

noted for their sensitivity to relatively 

low doses of N deposition, particularly 

at higher elevations. 

In addition to the difficulties 

described above, there are other 

considerations that add to the 

complexity of determining doseresponse relationships for NOX. These 

include: (1) In addition to multiple 

nitrogen compounds that must be 

identified, the observed ecosystem 

responses to pollutant deposition can 

also be the result of combined pollutant 

impacts, such as the acidification of 

lakes from both sulfur and nitrogen 

deposition; (2) short-term increases of 

nitrates in streams have occurred in the 

absence of concurrent increases of N 

deposition but have been positively 

correlated with mean annual air 

temperatures (Murdoch, 1998), and high 

levels of nitrogen have occurred in the 

absence of anthropogenic sources; and 

(3) it may take years before certain 

ecosystems come into balance with the 

cumulative amounts of nitrogen inputs 

(making it difficult to determine the 

level at which recovery begins). 

The difficulty of establishing the 

dose-response relationships associated 

with NOX is further illustrated by EPA’s 

experience in evaluating the feasibility 

of setting an acid deposition standard. 

Under section 404 of the 1990 

Amendments, Pub. L. 101–549, 

Congress directed EPA to conduct a 

study of the feasibility and effectiveness 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59605 

of an acid deposition standard(s), to 

report to Congress on the role that a 

deposition standard(s) might play in 

supplementing the acidic deposition 

program adopted in title IV, and to 

determine what measures would be 

needed to integrate an acid deposition 

standard with that program. 

The EPA completed this study, ‘‘Acid 

Deposition Feasibility Study, Report to 

Congress’’ (1995), which concluded that 

current scientific uncertainties 

associated with determining the level of 

an acid deposition standard(s) are 

significant, and did not recommend 

setting an acid deposition standard. See 

State of New York v. Browner, 50 F. 

Supp. 2d 141, 149 (N.D.N.Y. 1999) 

(rejecting States’ claim that section 404 

required that the report include a 

deposition standard that would be 

sufficient to protect sensitive aquatic 

and terrestrial resources, and affirming 

EPA interpretation that duty was 

limited to ‘‘consideration of a 

description’’ of such standards). 

While EPA has recognized that 

programs, such as the CAIR (70 FR 

25162, May 12, 2005), that are intended 

to achieve NOX emissions reductions 

pursuant to other statutory provisions 

will help mitigate acid deposition 

problems, none of those programs 

purport to set an acid deposition 

standard. 

We note that one particular study, 

cited by two commenters, did include a 

‘‘conservative recommendation’’ for a 

threshold level (i.e., critical load) for 

nitrogen deposition based on ‘‘wetfall 

for Class I areas in the central Rocky 

Mountains.’’ (Williams, 2000.) In 

addition, it is reported that other efforts 

are underway by scientists using 

empirical studies and modeling to 

estimate critical loads for other areas of 

the U.S. Also, the NPS has spent 

considerable time evaluating the effects 

of both sulfur and nitrogen deposition 

in several national parks, and has 

estimated critical loadings associated 

with some of their important natural 

resources. (Porter, 2005.) 

We have considered whether the 

concept of a ‘‘critical load’’ could be 

used to identify an alternative 

increment level. At this time, we do not 

believe that the current status of such 

research can be used as a basis for us to 

establish national increments, or other 

measures of NOX, that could be applied 

throughout the U.S. We do, however, 

provide further discussion in section VII 

concerning the critical load concept and 

its potential for being an effective air 

quality management tool. 

As discussed in the welfare effects 

section (V.D.2), although we are seeing 

effects at current nitrogen deposition 

rates, for the above reasons we believe 

that it is not technically or practicably 

feasible to identify a quantitative basis 

for concluding that the existing NO2

increments are inadequate to provide 

protection against the types of adverse 

effects on ecosystems that may occur in 

some areas notwithstanding compliance 

with the NAAQS. In particular, it is not 

possible to determine a different level of 

increment protection that would define 

a significant deterioration level for 

ecosystem effects associated with 

emissions of NOX. Thus, currently 

available information does not provide 

a nationally applicable, quantitative 

basis for revising the existing NO2

increments. 

(2) Qualitative Evaluation. As 

explained above, the available scientific 

and technical data do not yet enable us 

to adequately relate ambient 

concentrations of NOX to ecosystem 

responses. Without such key 

information, it is difficult to 

quantitatively evaluate the effectiveness 

of the ‘‘safe harbor’’ increments for 

protecting air quality values, health and 

welfare, and parks while ensuring 

economic growth consistent with the 

preservation of clean air resources. 

Alternatively, we must make a 

qualitative judgment as to whether the 

existing NO2 increments or some 

alternative increments meet the 

applicable factors. 

In this situation, we believe that 

determining the increment levels that 

satisfy the factors applicable under 

section 166(c) is ultimately a policy 

choice that the Administrator must 

make, similar to the policy choice the 

Administrator must make in setting a 

primary NAAQS ‘‘with an adequate 

margin of safety.’’ See Lead Industries 

Ass’n v. EPA, 647 F.2d 1130, 1147 (D.C. 

Cir. 1980) (where information is 

insufficient to permit fully informed 

factual determinations, the 

Administrator’s decisions rest largely on 

policy judgments). Using a similar 

approach is warranted because both 

section 109 and section 160(1) direct the 

Administrator to use his or her 

judgment in making choices regarding 

an adequate margin of safety or 

protecting against effects that may still 

occur notwithstanding compliance with 

the NAAQS—both areas of inquiry 

characterized by great uncertainty. 

Thus, in the process for setting NAAQS, 

the Administrator looks to factors such 

as the uncertainty of the science, the 

seriousness of the health effects, and the 

magnitude of the environmental 

problem (isolated or commonplace). 

E.g., 62 FR 38652 (July 18, 1997) (PM2.5

NAAQS). 

Bearing on this policy decision for 

increments are various considerations, 

based on the available information and 

the factors applicable under section 

166(c). The factors establishing 

particular environmental objectives 

(protecting air quality values, health and 

welfare, and parks) might suggest that, 

in some areas, we permit no or minimal 

increases in NOX emissions or establish 

an increment for another form of NOX

because there are data indicating that an 

effect may be attributable to NOX

emissions. However, as explained 

earlier, we do not believe that Congress 

intended for the PSD program to 

eliminate all negative effects. Thus, 

rather than just seeking to eliminate all 

negative effects, we must attempt to 

identify a level of increase at which any 

additional effects beyond existing (or 

baseline) levels would be ‘‘significant’’

and protect against those ‘‘adverse’’

effects. Furthermore, we need to ensure 

that our increments provide room for 

some economic growth. Congress 

intended for EPA to weigh these 

considerations carefully and establish 

regulations that balance economic 

growth and environmental protection. 

Since we are unable to establish a 

direct, widely applicable, quantitative 

relationship between particular levels of 

NOX and specific negative effects, we 

give particular weight to the policy 

judgment that Congress made when it 

set the statutory increments as a 

percentage of the NAAQS and created 

increments for the same pollutant form 

and time period that was reflected in the 

NAAQS. In section 166 of the Act, 

Congress directed that EPA study the 

establishment of PSD regulations for 

other pollutants for which Congress did 

not wish to set increments at the time. 

Congress’ own reluctance to set 

increments to prevent significant 

deterioration of air quality due to 

emissions of NOX, and the provisions 

ensuring time for Congressional review 

and action, suggest that Congress 

intended for EPA to avoid speculative 

judgments about the science where data 

are lacking. Thus, in the absence of 

specific data showing that a marginal 

increase of a particular level below the 

‘‘safe harbor’’ would better protect 

health, welfare, parks, and air quality 

values, while simultaneously 

maximizing opportunities for economic 

growth, we give weight in our 

qualitative analysis of the factors 

applicable under section 166(c) to the 

method that Congress used to establish 

the statutory increments. 

In making this qualitative judgment, 

we also consider the overall regulatory 

framework that we have established in 

the PSD regulations for NOX. This 

59606 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

27Since that time, we have refined the original 

NAAQS for PM (then measured as TSP) to focus on 

coarse (PM10) and fine (PM2.5) particulate matter. 

We subsequently established increments for PM10

in accordance with section 166(f) of the Act. 58 FR 

31622 (June 3, 1993). We are considering 

establishing increments for PM2.5. 

28Another source of nitrates, not associated with 

emissions of NOX, is the nitrification of ammonium 

by bacteria in stream beds. 

framework includes a case-by-case 

analysis of each permit application to 

identify additional impacts (e.g., soils 

and vegetation), a special review by the 

FLM and State permitting authority of 

potential adverse effects on air quality 

values in parks and special areas, and a 

requirement that all new and modified 

sources install BACT. In addition, the 

area classification system ensures that 

there will be economic growth in 

particular areas that are consistent with 

the values of each State and individual 

communities within States. 

c. Three characteristics of increments 

for NOX. 

(1) Form of increment. A significant 

issue in the EDF v. EPA case was EPA’s 

action in 1988 to establish an increment 

for only one form of NOX, i.e., NO2. We 

promulgated increments for NO2 in 

1988 because NO2 was the only form of 

NOX for which we had established a 

NAAQS at that time. However, the court 

held in EDF v. EPA that section 166(c) 

of the Act ‘‘commands the 

Administrator to inquire into a 

pollutant’s relation to the goals and 

purposes of the statute, and we find 

nothing in the language or legislative 

history suggesting that this duty could 

be satisfied simply by referencing the 

ambient standards.’’ 898 F.2d at 190. As 

a result, in this rulemaking action on 

remand, we weighed the relevant 

evidence to determine whether the data 

supported the potential use of other 

forms of NOX to serve as measures for 

the increments and, if so, what 

numerical levels would be appropriate. 

We requested comment on whether 

we should adopt increments for other 

forms of NOX and received several 

comments recommending that EPA do 

so. Some of these commenters claimed 

that the statute requires EPA to examine 

and regulate nitrogen compounds other 

than NO2, to protect the air quality, 

especially in Class I areas. Therefore, 

these commenters called upon EPA to 

develop increments that accounted for 

other forms of NOX, such as nitric acid, 

nitrate, ammonium nitrate, and for 

ozone. Some commenters recognized 

the complexity of the total nitrogen 

deposition problem and recommended 

that EPA revise and retain the existing 

increments on an interim basis, while 

undertaking the necessary steps to study 

the full scope of the problems associated 

with NOX and revising the PSD 

regulations for NOX accordingly. For the 

reasons discussed below, we have 

decided not to add any additional 

increments based on other forms of NOX

to the existing increments for NO2. 

Under the ‘‘contingent safe harbor’’

approach discussed above, we began our 

analysis with ‘‘safe harbor’’ increments 

that address increases in ambient NO2

concentrations. Since 1988, EPA has not 

identified a basis upon which to 

establish a NAAQS for any form of NOX

other than NO2. Thus, it remains the 

case today that the only NAAQS 

established for NOX are the current NO2

NAAQS which have not changed since 

1971. We believe that increments based 

on the same pollutant for which we 

have a NAAQS are the ‘‘safe harbor’’ for 

the purposes of this rulemaking. 

Establishing increments for this form 

of NOX is ‘‘at least as effective’’ as the 

statutory increments in section 163 of 

the Act. Congress established statutory 

increments in section 163 for only those 

forms of PM and sulfur oxides for which 

we had promulgated a NAAQS.27 As 

discussed above, the need for an 

increment necessarily derives from the 

establishment of a NAAQS, which is the 

basic measure of air quality under the 

CAA. Thus, an increment based on this 

basic measure of air quality is ‘‘at least 

as effective’’ as the statutory increments 

in section 163 of the Act. The court in 

EDF v. EPA rejected the argument that 

increments based on the same form of 

NOX as the NAAQS were not ‘‘as 

effective as’’ the increments in section 

163. 898 F.2d at 190. 

We acknowledge that the available 

scientific and technical evidence 

indicates that the range of adverse 

effects being observed in the various 

ecosystems studied are the result of 

contributions from several forms of NOX

other than NO2. We noted earlier in this 

preamble that seven species of oxides of 

nitrogen are known to occur in the 

atmosphere. However, anthropogenic 

emissions of NOX predominantly 

originate as NO and quickly oxidize into 

NO2. As described in section V of the 

preamble, under the discussion of 

environmental effects, many of the 

negative effects indirectly related to 

emissions of NO and NO2 are caused (or 

contributed to) largely by nitrogen 

compounds (e.g., nitrates, nitric acid) 

which result from chemical 

transformations of NO2 in the 

atmosphere. 

In particular, nitrates (NO3

¥), 

primarily in the form of nitric acid 

(HNO3) and nitrate aerosols such as 

ammonium nitrate (NH4NO3), are 

primary constituents of nitrogen 

deposition and can play a significant 

role in producing welfare effects that are 

indirectly attributable to emissions of 

NO and NO2. As a result, we examined 

the feasibility of establishing numerical 

increments that would include 

measurement of nitrates. 

In the February 2005 proposal, we 

noted several reasons why we believed 

that it was not necessary to adopt 

individual increments for nitrate. First, 

the existing NO2 increments, which 

limit the allowable increase of NO2 in a 

given area, serve also to limit the 

amount of nitrate in the atmosphere.28

That is, by limiting the allowable 

increase in ambient concentrations of 

NO2 in the immediate area surrounding 

a proposed new or modified PSD 

source, some limit can effectively be 

placed on downwind formations of 

nitrate compounds as well. 

We also noted that ambient nitrate 

often exists in the atmosphere in 

particulate form, e.g., ammonium nitrate 

and nitrate salts formed from nitric acid. 

These forms are known to contribute to 

regional haze. Based on this, we 

indicated our belief that nitrates could 

be more effectively regulated under our 

national PM program. 

Notwithstanding these reasons for not 

needing a nitrate-based increment, we 

further explained that the available 

scientific and technical evidence 

available for our consideration did not 

exist (1) to adequately establish a 

quantifiable relationship between NOX

emissions (NO/NO2) and nitrogen 

deposition products, including nitrates, 

or (2) to set numerical levels for such 

increments. 

Some of the commenters who 

supported the need for increments 

based on a broader measure of NOX

referenced more recent studies which 

point to the worsening trends of 

nitrogen deposition, and observations of 

adverse effects, in various areas of the 

country as evidence that the existing 

NO2 increments are ineffective. On this 

basis, the commenters claimed that the 

existing NO2 increments did not satisfy 

sections 166(c) and 160 of the Act. 

While we do not discount the findings 

contained in these studies, we do not 

believe that these more recent studies 

provide the necessary information either 

to establish broader nitrogen-based 

increments or to indicate that the NO2

increments are ineffective. 

As was the case with the more recent 

studies that we reviewed, the studies 

cited by commenters are based on 

observations of adverse ecological 

effects in specific localized areas where 

sensitive ecosystem receptors are known 

to exist. Such studies clearly have 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59607 

enhanced our ability to understand the 

mechanics of the pollutant deposition 

process, identify deposition trends, and 

document the adverse effects to which 

nitrogen deposition contributes. Yet the 

same studies in most cases continue to 

fall short of enabling us to quantify the 

levels of deposition responsible for the 

recorded changes. In fact, many of these 

studies conclude by calling for 

additional research to collect the data 

necessary to quantify the dose-response 

relationships associated with nitrogen. 

Even considering more recent 

evidence, we continue to believe that it 

is not feasible to develop broader-based 

increments for NOX at this time, and the 

nitrate deposition effects in local areas 

where sensitive ecosystems exist will be 

more effectively addressed via the 

broader set of PSD regulations for NOX

and by various PM control programs 

that will apply in those local areas. 

Finally, with regard to commenters’

recommendations that we establish 

increments to address the effects of 

ozone, we indicated earlier that we do 

not believe Congress intended for us to 

consider the effects of other regulated 

pollutants, such as ozone, when 

establishing increments for NOX. We 

continue to believe that the increments 

for NOX need only consider effects 

resulting from ambient NO2 and other 

forms of NOX (resulting from the 

transformation of NO2 in the 

atmosphere), rather than secondary 

pollutants for which Congress expected 

separate PSD regulations, including 

increments. See relevant comments 

concerning increments for secondary 

pollutants associated with NOX and our 

responses to those comments in section 

V.D. of this preamble. 

A key problem that we have already 

discussed, however, is that studies of 

nitrogen deposition indicate that the 

nitrogen input from total atmospheric 

nitrogen deposition is not simply the 

result of emissions of NOX, but of other 

nitrogen compounds as well, including 

ammonia and ammonium. For example, 

when ambient concentrations of 

ammonia and nitric acid are sufficiently 

high, ammonium nitrate can be formed 

and both the ammonium and the nitrate 

become components of nitrogen 

deposition contributing nitrogen to an 

ecosystem. For these reasons, we do not 

believe it is feasible to adopt an 

additional increment for another form of 

NOX to protect air quality values, health 

and welfare, and parks and special 

areas, from NOX emissions increases 

associated with new and modified PSD 

sources. Thus we are adopting the ‘‘safe 

harbor’’ increments and retaining the 

existing increments for NO2. Under 

these circumstances, the NAAQS 

provides a reasonable benchmark for 

identifying the pollutant to be used in 

an increment. 

Section 160(1) of the Act is expressed 

by using the NAAQS as a benchmark 

and also uses standards that mirror the 

standards applicable to the NAAQSsetting process— ‘‘protect public health 

and welfare.’’ The court in EDF v. EPA 

rejected use of the NAAQS as the ‘‘sole 

basis’’ for deriving the increments for 

NOX but did not preclude EPA from 

adopting only increments based on the 

same pollutant as the NAAQS when 

EPA has determined that additional 

increments are not needed after 

considering the factors applicable under 

section 166(c) of the Act. See 898 F.2d 

at 190. As we have explained earlier, 

several of the ‘‘other forms of NOX’’ that 

commenters recommend be included in 

the increments for NOX are more 

appropriately addressed under programs 

for other criteria pollutants, as well as 

some of the multi-pollutant emissions 

reductions programs that have been 

established across the U.S. 

(2) Increment averaging periods. The 

existing NO2 increments, promulgated 

in 1988, are based on an annual 

averaging period, consistent with the 

NO2 NAAQS. In the 1988 rule, EPA did 

not set short-term NO2 increments 

because a short-term NAAQS for NO2

that would define short-term air quality 

for NO2 did not exist. However, the 

court directed us to evaluate whether, 

considering the factors applicable under 

section 166(c), we should promulgate 

additional increments for short-term 

averaging times. 898 F.2d at 190. Thus, 

we have evaluated and requested 

comment on the need to promulgate 

additional NO2 increments based on a 

short-term averaging time to satisfy 

section 166(c) of the Act. Several of the 

commenters that opposed EPA’s 

proposed decision to retain the existing 

increments without modifying them 

argued that short-term increments were 

needed to meet our responsibility to 

provide health and welfare protection 

under the requirements of section 166(c) 

of the Act. 

However, for the reasons discussed 

below, we are not persuaded that shortterm NO2 increments are necessary to 

satisfy the factors applicable under 

section 166(c). 

Under the ‘‘contingent safe harbor’’

approach discussed above, we began our 

analysis with the ‘‘safe harbor’’

increments that are based on the same 

annual averaging time used in the 

NAAQS. Since 1988, EPA has not found 

cause to promulgate a NAAQS for any 

averaging period other than the annual 

average. Thus, since this is the only 

averaging time used in the current 

NAAQS, we consider an increment that 

employs this averaging time to be a 

‘‘safe harbor’’ that is ‘‘at least as 

effective’’ as the statutory increments in 

section 163 of the Act. The increments 

listed in section 163 of the Act are based 

on the same averaging times that were 

contained in the NAAQS at the time 

Congress adopted this provision. The 

NAAQS are the basic measure of air 

quality under the CAA. Therefore, an 

increment that uses this standard as a 

benchmark is ‘‘at least as effective’’ as 

the statutory increments in section 163 

of the Act. The court in EDF v. EPA 

rejected the argument that an increment 

based on the same averaging time as the 

NAAQS was not ‘‘as effective as’’ the 

increments in section 163. 898 F.2d at 

190. 

We reviewed the scientific and 

technical evidence available in the 1993 

Criteria Document for NOX in light of 

the section 166(c) criteria to determine 

whether it justified the need for a shortterm increment, even though no shortterm NO2 NAAQS existed from which to 

derive a short-term safe harbor 

increment. As we indicated in the 

February 2005 proposal, the available 

evidence did not identify any adverse 

health effects from short-term exposure 

to ambient NO2 concentrations in areas 

with air quality meeting the NO2

NAAQS. Thus, we proposed to find that 

a short-term increment was not needed 

to provide any additional health 

protection beyond assuring that the 

existing increments would keep ambient 

NO2 concentrations at levels below the 

NO2 NAAQS. 

Some commenters disagreed with us 

and expressed the need for a 1-hour NO2

increment for health-related purposes. 

Some of these commenters urged us to 

consider recent health data and the fact 

that California has adopted a short-term 

health standard for NO2 exposure. 

However, we continue to believe, based 

primarily on the evidence in the 1993 

Criteria Document and 1995 Staff Paper 

for NOX, that there is insufficient 

evidence to justify a national short-term 

NO2 increment to provide additional 

health protection. As mentioned above, 

as part of the last review of the NO2

NAAQS in 1996, EPA did not find 

adequate evidence that health effects 

from short-term exposure NO2 occurred 

in areas where air quality levels met the 

NO2 NAAQS. 

The Administrator concluded from 

that review that the annual standard of 

0.053 parts per million (ppm) NO2

provides ‘‘substantial protection’’

against the identified health effects 

(mild changes in pulmonary function or 

airway responsiveness in sensitive 

individuals) associated with short-term 

59608 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

29 It should be noted, however, that California’s 

standard was not established on the basis of new 

information since our last periodic review of the 

NO2 NAAQS. California established an ‘‘Adverse 

Level’’ for NO2 (0.25 ppm, 1-hour) in 1962. In 1969, 

the California Air Resources Board set a short-term 

air quality standard for NO2 using the original alert 

level. 

peaks occurring in the range of 0.2 to 0.5 

ppm—almost one order of magnitude 

higher than the annual standard. 60 FR 

52875, 52879–80 (October 11, 1995). 

The adequacy of the annual standard to 

protect against these potential shortterm effects was further supported by 

the absence of documented effects in 

some studies at higher concentrations (3 

ppm to 4 ppm). 

We continue to believe that the 

existing primary annual NO2 NAAQS 

provides sufficient protection against 

the likelihood of short-term NO2

concentrations that would cause adverse 

human health responses in most areas of 

the U.S. We have no evidence at this 

time showing that there is a problem 

from a national perspective concerning 

short-term NO2 concentrations that 

would represent a threat to human 

health, and the commenters have not 

provided information indicating a 

national problem for us to consider. We 

do know that high maximum 1-hour 

NO2 concentrations have been measured 

in a few locations, including 

California—the only State that has 

adopted a short-term air quality 

standard for NO2 (0.25 ppm, 1-hour).29

We have reviewed NO2 air quality 

data collected from 592 monitoring site 

locations nationally from EPA’s Air 

Quality System to determine how 

effective the current primary annual 

NO2 NAAQS is in preventing high 

short-term NO2 concentrations. These 

data show that, since 1999, only 14 sites 

(a few with multiple occurrences) across 

the U.S. have recorded peak 1-hour 

concentrations exceeding 0.25 ppm 

NO2. Only one monitoring site recorded 

such peaks from 2003–2004. Thus, from 

a national perspective, we do not find 

support for a short-term NO2 increment 

to provide health protection beyond that 

being provided by the existing annual 

primary NO2 NAAQS. 

We are aware of the fact that later 

studies have been published concerning 

human responses to short-term exposure 

to ambient NO2 concentrations. These 

studies will be considered in the 

Agency’s next periodic review of the 

NO2 NAAQS. To the extent that any 

new relevant information is 

incorporated into the Criteria Document 

for oxides of nitrogen, we will carefully 

evaluate such evidence under the 

rigorous process described earlier in this 

preamble, involving CASAC and a 

public review process, to determine 

whether it is appropriate to adopt a 

short-term primary NO2 NAAQS. In 

accordance with the requirements of 

section 166 of the Act, following 

promulgation of any revised NAAQS for 

NOX, based on the same body of 

scientific and technical evidence, we 

will also review that evidence against 

the requirements of section 166(c) to 

determine the need to modify the 

existing NO2 increments. However, at 

this time we do not believe there is a 

need to modify the existing NO2

increments to provide a nationwide 

level of health protection beyond what 

is being provided by the primary annual 

NO2 NAAQS. 

In addition, the information that we 

reviewed concerning welfare effects 

associated with short-term exposure to 

NOX did not convince us that there was 

a justification for a short-term increment 

to provide additional protection against 

adverse welfare effects. The available 

information indicated that known 

impacts were insignificant in some 

cases (e.g., effects on terrestrial 

vegetation), while in other cases (e.g., 

chronic acidification of surface waters) 

insufficient information existed to 

quantify how much of a contribution 

nitrogen deposition was making to the 

problem and what levels of reduction 

would be needed to remedy the negative 

impact. The effects that we reviewed are 

summarized in greater detail below and 

in section V of this preamble. 

Two commenters recommended that 

we adopt a 1-hour NO2 increment to 

prevent coherent plume (discoloration) 

visibility impairment. We do not believe 

that a short-term NO2 increment for 

such purposes is supported by the 

available evidence. As we indicated in 

our description of welfare effects in 

section V of this preamble, NO2 can 

cause a discoloration effect in a plume 

resulting in potential visibility 

impairment. However, the evidence also 

indicates that the presence of particulate 

in the plume can result in similar 

discoloration. Thus, the problem is not 

exclusively caused by NO2. Moreover, 

the 1995 Staff Paper for NOX noted that 

despite the known light-absorbing 

qualities of NO2, ‘‘there are relatively 

little data available for judging the 

actual importance of NO2 to visual air 

quality.’’

Visibility impairment associated with 

coherent plumes is currently addressed 

as part of the requirements for the 

AQRV review and the additional 

impacts analysis. This methodology 

measures visibility impairment resulting 

from multiple pollutants. The test for 

visibility impairment of this type is 

typically applied to sources locating less 

than 50 kilometers from a Class I area, 

and involves modeling the potential 

plume impacts to calculate 1-hour 

impacts within the elevated plume 

based on the concentrations of fine 

primary particulates and NO2 emitted 

by the source. The effects of secondarily 

formed sulfates can also be considered, 

where applicable and appropriate, in 

the modeling procedure. 

We do not believe it would be 

appropriate to establish a short-term 

NO2 increment to address this visibility 

impairment problem when it is known 

that the problem is associated with 

multi-pollutant impacts. The problems 

associated with coherent plumes are 

currently addressed through protection 

of AQRVs and the ‘‘additional impacts’’

analysis. (Congress explicitly identified 

visibility as an example of an AQRV.) 

We believe that this is the most effective 

way to address this multi-pollutant 

problem. 

Some commenters recommended 

short-term increments to protect against 

the increasing NOX pollution impacts. 

In this regard, we do not find a 

justification to establish a short-term 

increment for either NO2 or any other 

form of NOX. In the latest review of the 

NO2 NAAQS, the Administrator 

concluded that the impact on terrestrial 

vegetation from short-term exposures to 

NO2 under existing ambient levels is 

insignificant and did not warrant a 

short-term standard (1995 Staff Paper 

for NOX, p. 91). The Administrator also 

considered the welfare impacts from 

nitrate deposition during the last review 

of the NO2 NAAQS. The evidence 

indicated, however, that none of the 

welfare impacts from nitrates were 

directly attributed to short-term ambient 

nitrate concentrations. In those cases 

where nitrogen deposition was shown to 

cause episodic or ‘‘short-term’’ effects, 

such as episodic acidification of 

streamwaters, the problem was typically 

the result of a long-term accumulation 

of nitrogen compounds that were 

released suddenly to the ecosystem (e.g., 

snowmelt runoff to lakes and streams) 

rather than the direct result of shortterm concentrations of nitrates being 

transferred from the atmosphere. 

The ability to quantitatively relate N 

deposition to episodic acidification 

conditions is further hampered by 

evidence indicating that, because of 

conditions of nitrogen saturation, 

episodic acidification of surface waters 

and increased loadings to estuaries 

could worsen even without concurrent 

increases in N deposition. Later studies 

have verified this situation and have 

indicated that temperature change, 

among other things, rather than direct 

changes in the N deposition rate, can be 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59609 

30 ‘‘Impairment of visibility in multi-State regions, 

urban areas, and Class I areas is clearly an effect of 

particulate matter on public welfare.’’ OAQPS Staff 

Paper for Particulate Matter, July 1996 at p. VIII–

15. 

more influential in the increased 

acidification conditions. One later study 

we reviewed subsequent to the proposal 

revealed a positive correlation between 

short-term increases in stream nitrate 

concentrations and mean annual air 

temperature (affecting nitrogen 

movement in a watershed), while 

finding no statistically significant 

correlation between deposition and 

stream nitrate concentrations. 

(Murdoch, 1988.) 

One commenter recommended a 

short-term ammonium nitrate increment 

to address visibility problems associated 

with regional haze. However, we do not 

believe it is necessary to address this 

pollutant through our PSD regulations 

for NOX. Ammonium nitrate is a form of 

PM (i.e., nitrate particulate), and we 

already addressed the contribution of 

ammonium nitrates to total ambient PM 

levels and their effects on visibility 

(regional haze) under the PM program.30

In revising the NAAQS for PM in 1997, 

EPA considered the welfare effects of 

PM, including nitrates, on visibility 

impairment in considering the need to 

revise the secondary PM standards. In 

doing this, we considered the pertinent 

scientific and technical information 

contained in the current Criteria 

Document for PM and Staff Paper for 

PM to determine what an appropriate 

level would be for a secondary standard 

to address adverse effects of PM on 

visibility. We concluded from that 

process that a 24-hour PM2.5 primary 

standard in conjunction with a national 

regional haze program would be the 

more effective way to address regional 

variations in the adverse effects of fine 

particulate on visibility than by 

establishing national secondary 

standards for PM that would be lower 

than the PM2.5 primary standards. See 

62 FR 38652, July 18, 1997 at 38679–

38683. 

An important consideration in 

arriving at this decision was that there 

were significant differences in thencurrent visibility conditions in different 

areas of the country that could not 

effectively be addressed by a uniform 

national standard. Because our national 

control strategy for PM will include 

consideration of ammonium nitrate 

particles, we find no basis for 

establishing a short-term increment for 

ammonium nitrate to protect against 

visibility impairment as part of the PSD 

regulations for NOX. 

EPA has also recognized that NOX

results in the formation of ozone and 

nitrate particulates under certain 

conditions. Although ozone, PM10, and 

PM2.5 have short-term NAAQS to protect 

against public health effects associated 

with short-term exposure to these 

pollutants, EPA does not consider the 

impacts from these criteria pollutants, 

because it interprets section 166 to 

require consideration of these criteria 

pollutants separate and distinct from the 

duty to consider NOX. 

Based on these considerations, we 

believe that an annual average 

increment for NO2, coupled with the 

requirements for the ‘‘additional 

impacts’’ and AQRV protection in Class 

I areas, is sufficient to protect air quality 

values, health and welfare, including 

the sensitive ecosystems in parks and 

other special areas. Thus, we revert to 

the ‘‘safe harbor’’ of the existing annual 

NO2 increments and decline to adopt 

additional increments for shorter 

averaging periods under this final 

action. 

(3) Level of NO2 increment. Having 

concluded from the available scientific 

and technical evidence that additional 

increments based on other forms of NOX

or other averaging periods are either not 

necessary or not feasible, the remaining 

issue we evaluated in response to the 

court remand was whether there was a 

need for lower annual NO2 increments. 

Our review of the applicable scientific 

and technical evidence provided no 

basis for us to propose modifying the 

levels of the existing NO2 increments. 

As part of our proposal, the analysis 

of the appropriate levels for NO2

increments began by establishing a ‘‘safe 

harbor’’ increment level that was ‘‘at 

least as effective as’’ the increments 

established by Congress in section 163 

of the Act. 42 U.S.C. 7476(d). Under our 

interpretation of the Act, we 

preliminarily concluded that these ‘‘safe 

harbor’’ levels established the minimum 

stringency levels (or highest marginal 

increase in concentration levels) that we 

may use as the increments for NO2 for 

each class of area. 

The court in EDF v. EPA recognized 

that the ‘‘at least as effective’’ standard 

in section 166(d) of the Act is satisfied 

when we establish increments using the 

percentage-of-NAAQS approach that 

Congress used to establish the statutory 

increments. See 898 F.2d at 188. This 

approach involves using the same 

percentages that Congress used to 

calculate the PM and SO2 increments 

from the NAAQS in effect at that time 

for these pollutants. Because Congress 

used different percentages to calculate 

the Class I increments for PM and SO2, 

we had to decide which of these 

percentages was appropriate for the 

Class I NO2 increment. For the reasons 

described in the 1988 NO2 increment 

rulemaking, we considered it 

appropriate for NO2 increments to be 

derived using the same percentages that 

Congress used for SO2 because NO2

more closely resembles SO2 than PM in 

its characteristics and sources. See 53 

FR 3698, 3700 (February 8, 1988). 

Because the NO2 increments have not 

changed since 1988, the percentage-ofNAAQS approach yields the same levels 

that we derived in 1988. Thus, using 

this approach, the ‘‘safe harbor’’ level 

for the Class I NO2 increment was 

calculated as 2.5 μg/m3 (annual 

average), a level equal to 2.5 percent of 

the NO2 NAAQS. For the Class II NO2

increment, the ‘‘safe harbor’’ level is 25 

μg/m3—25 percent of the NO2 NAAQS. 

For the Class III NO2 increment, the 

‘‘safe harbor’’ level is 50 μg/m3—50 

percent of the NO2 NAAQS. 

Our next step was to consider the 

factors applicable under section 166(c) 

and evaluate whether we needed to 

revise the ‘‘safe harbor’’ level to satisfy 

these factors. To the extent we were to 

find that the marginal increase in 

concentration allowed by the ‘‘safe 

harbor’’ level did not adequately protect 

against these effects and ensure 

economic growth consistent with 

preservation of clean air resources, we 

were obligated to attempt to identify an 

alternative level of marginal increase 

that would satisfy the factors applicable 

under section 166(c). 

In order to identify the appropriate 

level of increase for ambient NO2

concentrations, we attempted to 

establish a quantitative relationship 

between the emissions of NO2 and 

potential adverse effects. Unfortunately, 

this approach was hindered for several 

reasons. First, the available evidence we 

reviewed was inconclusive regarding 

the pollutant concentrations at which 

the effects may occur. As previously 

described, in some instances, the 

available scientific and technical 

evidence revealed no significant effects, 

while in other cases the evidence 

revealed uncertainty about the direct 

relationship between the pollutant and 

its precise role in causing the effect. 

This requires an understanding of the 

intermediate transformation processes 

and the deposition patterns and total 

quantities of those nitrogen compounds 

which may contribute to the known or 

observed effects, as well as the nitrogen 

contribution to ecosystems from natural 

geobiochemical processes. 

Second, since many of the negative 

effects were associated with total 

nitrogen deposition (indirectly 

associated with NO2), i.e., caused by 

NOX compounds which have been 

transformed from NO2 in the 

59610 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

31Section 166(a) of the Act requires in part that 

‘‘In the case of pollutants for which national 

ambient air quality standards are promulgated after 

the date of enactment of this part, he [the 

Administrator] shall promulgate such regulations 

not more than 2 years after the date of promulgation 

of such standards.’’

atmosphere, it was also necessary to 

attempt to understand the quantitative 

relationship between emissions of NO2

(the regulated form of the increment) 

and the observed negative 

environmental effects. Such 

relationships could not be sufficiently 

identified from the available evidence. 

As a result of these findings, we 

proposed to find that the necessary 

scientific evidence was not yet available 

to determine that the existing safe 

harbor NO2 increments are not 

adequately protective for purposes of 

defining ‘‘significant deterioration.’’

Therefore, we proposed to retain the 

existing NO2 increments to limit 

allowable increases in ambient 

pollution associated with NOX

emissions and protect against health 

and welfare effects that might occur in 

areas where the air quality is better than 

the NO2 NAAQS. 

Some commenters objected to this 

proposed decision to retain the existing 

increments, although most of them 

generally did not suggest ways to revise 

the existing levels (other than to 

recommend short-term NO2 increments) 

to make them more protective. For the 

most part, the studies and information 

provided by these commenters advance 

the knowledge about N deposition 

trends and how nitrogen inputs 

adversely affect sensitive resources at 

various locations, but they also support 

our original conclusions in the February 

2005 proposal that there is not yet 

sufficient evidence to quantify a doseresponse relationship between NOX and 

the various negative effects being 

observed and reported. 

We could establish more stringent 

increments simply by setting the 

allowable levels of pollutant increases at 

lower numerical values; however, we 

can find no basis for determining what 

particular lower values would provide 

the ‘‘correct’’ level of protection against 

the types of effects that have been 

identified. Consequently, we believe it 

would be inappropriate to arbitrarily 

select more stringent values for the NO2

increments that are not supported by the 

available scientific and technical 

evidence. 

Lacking a clear quantitative basis for 

establishing lower increment levels, we 

conducted a qualitative evaluation of 

the safe harbor increments in light of the 

considerations discussed above. To 

achieve equity and protect against 

effects that are variable across regions of 

the country, we believe each of the NO2

increments should be set at a level that 

reasonably protects air quality values, 

health and welfare, and parks and 

special areas across the country, while 

also balancing the need to allow 

economic growth. 

We continue to believe our ultimate 

obligation under section 166 of the Act 

is to establish a set of regulations for 

NOX which contain provisions that 

collectively satisfy the content 

requirements in sections 166(c) and 

166(d) of the Act. Thus, we think 

Congress contemplated that we would 

consider the entire set of regulations 

when we establish specific aspects of 

those regulations. As a result, we 

believe it is appropriate and consistent 

with our statutory obligations to 

consider the protection provided by the 

additional impacts analysis and the 

FLM review of AQRVs when evaluating 

the level of NO2 increments that defines 

‘‘significant deterioration.’’

Thus, based on the overall 

insufficiency of the available scientific 

and technical evidences to enable us to 

define a quantitative dose-response 

relationship, we believe the ‘‘safe 

harbor’’ approach for setting the 

increment levels is sufficient to satisfy 

the factors applicable under section 

166(c), when coupled with the overall 

framework of PSD regulations 

applicable to NOX. This approach 

generally maximizes opportunities for 

economic growth while ensuring that 

each area receives a sufficient level of 

protection against ‘‘significant 

deterioration’’ of air quality consistent 

with Congressional policy. To the extent 

necessary, the case-by-case additional 

impact analysis (in Class I and II areas) 

and AQRV review (in Class I areas) will 

provide additional protection in 

particular areas that may be more 

sensitive to nitrogen loadings resulting 

from NOX emissions. Under these 

circumstances, we can find no basis for 

modifying the safe harbor increments, 

based on the approach established by 

Congress for the statutory increments. 

Thus, we retain the existing NO2

increments that were established at the 

‘‘safe harbor’’ level using the statutory 

‘‘percentage-of-NAAQS’’ approach. 

Several commenters seemed to 

suggest that we should no longer be 

relying on increments promulgated in 

1988 to protect the environment and 

that it was time to update them. 

However, the Act does not provide a 

mechanism for periodically reviewing 

the increments for a particular 

pollutant. EPA’s statutory responsibility 

for developing increments is linked to 

its responsibility for promulgating 

NAAQS. Section 166 requires EPA to 

promulgate increments for a pollutant 

following the promulgation of NAAQS 

for that pollutant. While the Act is silent 

in section 166 on how EPA is to respond 

to future revisions to existing NAAQS, 

we believe there may be certain 

circumstances when it is appropriate to 

review the increments for certain types 

of NAAQS revisions. For example, 

should EPA determine as part of a 

periodic review of the NO2 NAAQS to 

promulgate a new, short-term NAAQS, 

then we believe it may be appropriate to 

consider the promulgation of a shortterm increment as well. Nevertheless, 

this final action being taken today 

regarding the NO2 increments is not a 

periodic review of the increments but a 

response to a court order requiring us to 

demonstrate the adequacy of the NO2

increments, which we promulgated in 

1988, in accordance with the relevant 

requirements that Congress provided for 

promulgating pollutant-specific PSD 

increments under section 166 of the Act. 

d. Future considerations. 

We agree with the commenters who 

have recognized the complexity of the 

total nitrogen deposition issue and 

suggested that it will take time to better 

understand the problems and solutions. 

The Act does not authorize EPA to 

reevaluate or upgrade the increments 

periodically, but generally requires new 

PSD regulations, which may include 

increments, following the promulgation 

of NAAQS.31 Thus, as new information 

comes along to better document the 

dose-response relationships between 

NOX and the various health- and 

welfare-related effects, we are not 

necessarily obligated to revise the 

existing increments for NOX unless such 

information results in changes to the 

NAAQS. Hence, after any changes to the 

NAAQS, we would likely evaluate the 

PSD regulations for NOX to determine 

what modifications, if any, are 

appropriate to meet the requirements of 

section 166 of the Act. 

This is not to say, however, that the 

advance of relevant scientific and 

technical evidence could not be used to 

establish more effective mechanisms as 

part of the PSD regulations where we 

deem them to be appropriate. An 

example of this would be the use of the 

critical loads concept. In the February 

2005 proposal, we proposed not to 

incorporate a critical loads approach as 

part of the national increment system 

(see 70 FR at 8914). We continue to 

believe that it would not be appropriate 

to do so at this time. Therefore, in 

today’s final action, we are not adopting 

a critical loads approach in lieu of the 

existing NO2 increments, nor are we at 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59611 

this time incorporating a critical loads 

approach into the overall PSD 

regulations for NOX. However, we 

remain interested in the concept and 

recognize its potential for addressing the 

adverse effects of nitrogen deposition. 

We discuss the critical loads approach 

more in section VII of this preamble. 

Yet, we recognize that we may be 

obligated to consider modifications to 

the existing increments as new scientific 

and technical information becomes 

available, and when revisions to the 

existing NO2 NAAQS are made. 

However, even as threshold levels of 

adverse impact are able to be defined for 

individual ecosystems, the diverse range 

of responses of nitrogen to different 

ecosystem as well as the number of 

factors (and interactions of those factors) 

which determine the response of 

ecosystems to anthropogenic nitrogen 

input will make it very difficult to 

establish uniform national increments 

which, by themselves, provide both an 

adequate level of protection in the most 

sensitive areas and a reasonable 

measure of ‘‘significant’’ deterioration in 

less sensitive areas. 

B. State Option To Employ Alternatives 

to Increment 

We are amending our regulations to 

explicitly give States the option to 

continue implementing the NO2

increment program or to design an 

alternative approach as part of its SIP 

and submit this program to EPA for 

approval. If any States wish to pursue 

the latter option, EPA will review State 

requests on a case-by-case basis to 

determine if the State alternative 

program satisfies the requirements of 

sections 166(c) and 166(d) of the CAA 

and prevents significant deterioration of 

air quality from emissions of NOX. 

We are not establishing any specific 

regulatory criteria to govern the review 

and approval of such a program other 

than what is already contained within 

section 166 of the CAA. EPA is not 

prepared at this time to conclude that 

any particular type of program other 

than the existing increment framework 

meets the requirements of sections 

166(c) and 166(d) of the CAA. However, 

as discussed in section IV above, we 

continue to believe EPA’s obligation 

under section 166 to promulgate 

pollutant-specific regulations for NOX

can be satisfied by allowing States to 

demonstrate that ‘‘other measures’’

besides increments will prevent 

significant deterioration of air quality 

due to an increase in emissions of NOX, 

as long as those measures are consistent 

with the requirements of sections 166(c) 

and 166(d) of the Act. 

1. States May Adopt ‘‘Other Measures’’

That Fulfill Section 166 of the Act 

In options 2 and 3 of the proposal, we 

proposed to address the requirements of 

section 166 of the CAA for NOX through 

the review and approval of State 

programs that employed alternative 

approaches to fulfill the requirements of 

sections 166(c) and 166(d) of the Act. 

We are codifying only this core 

principle in our regulations today 

without identifying any specific type of 

alternative program that would meet 

these requirements. EPA is postponing 

decisions on adequacy of specific 

elements of a State’s alternative 

approach until such time as the State 

submits its plan to EPA in a case-bycase SIP approval process. We believe 

this less prescriptive approach may 

allow some States to employ an 

alternate approach sooner and more 

efficiently, without waiting for EPA to 

develop a comprehensive one-size-fitsall program through additional 

rulemaking. 

Accordingly, we are amending our 

PSD rule at § 51.166 to reflect that an 

alternative approach to maximum 

allowable pollutant concentrations or 

increments for NO2 that meet the 

requirements of section 166 of the Act 

may be employed upon approval by the 

Administrator. We are requiring that a 

State’s alternative approach meet three 

broad criteria, which will be explored in 

more detail on a case-by-case basis. The 

approach must: prevent significant 

deterioration of air quality due to 

emissions of NOX; fulfill requirements 

of section 166 of the Act; and be 

demonstrated in the SIP. We are not 

establishing criteria, other than the 

requirements of the Act itself, by which 

to review a State’s submittal, and we are 

not defining any particular type of 

alternative approach for States to use as 

a substitute for the NOX increments. 

Rather, we are simply making clear in 

the regulations that States have the 

flexibility to employ an alternative 

approach to the NOX increments. 

2. EPA Is Not Adopting Elements of 

Option 3 

Although this approach of allowing 

States to submit alternative programs 

has some similarities to our proposed 

option 3, we are not adopting several of 

the elements that we proposed as part 

of option 3 (the State planning 

approach). When we proposed option 3, 

we envisioned that the EPA could 

establish a specific planning goal for 

States, or require each State to establish 

one, and then provide a process by 

which States would demonstrate how 

the measures in their SIPs would 

achieve this goal. One specific planning 

goal we proposed was to keep statewide 

emissions of NOX from all sources 

below 1990 levels. 

Several commenters expressed 

concerns that option 3 of the proposal 

did not include sufficient detail. We 

agree with the commenters that there 

were numerous specific elements of the 

State planning approach that we had not 

fully addressed in our proposal. The 

unresolved issues related to option 3 

included the following: (1) Timing of 

the SIP approval with discontinuation 

of NOX increment tracking; (2) a State 

plan’s failure to prevent significant 

deterioration due to NOX emissions; (3) 

periodic assessment of PSD cumulative 

increment impacts; (4) additional 

measures (backstops); (5) potential for 

localized adverse impacts; and (6) 

effects of an alternative approach on air 

quality in neighboring States. 

Because we have not yet resolved 

these issues, we have decided to codify 

only the core element of options 2 and 

3—the principle that a State may 

employ alternatives to increment upon 

a proper demonstration. Thus, instead 

of seeking to resolve these issues for 

every State in advance through a 

rulemaking action, we will consider 

these types of issues on a case-by-case 

basis during review of individual State 

plans. At this time, we believe we can 

more effectively consider and address 

such issues in the context of specific 

plan approvals. 

Although option 3 of our proposal 

lacked detail, several commenters 

tentatively supported the flexibility 

provided by option 3. Some commenters 

preferred a case-by-case approach to 

having ‘‘one-size-fits-all’’ criteria 

applicable to each State. Several 

commenters encouraged flexibility to 

acknowledge the differences in the air 

quality and types of sources among 

western and eastern States. 

Other commenters opposed giving 

States flexibility on the grounds that 

this would result in a lack of uniformity 

nationwide. One commenter was 

concerned that State-to-State levels of 

NOX protections would vary, resulting 

in an uneven playing field for regulated 

sources. 

We recognize there are reasons to 

support flexibility and reasons to 

support uniform treatment. We 

addressed the juxtaposition of these 

issues in evaluating the increment 

system and related provisions, as 

discussed in more detail above. Our 

conclusion for those circumstances was 

that we could to some extent balance 

these concerns by combining a uniform 

increment system with a case-by-case 

review of additional impacts and 

59612 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

AQRVs. We believe we can also 

consider the need for a level playing 

field and the need to address regional 

variability when reviewing individual 

State alternatives. Thus, we do not 

believe we should foreclose 

permanently the option for States to 

demonstrate that they can design an 

alternative program. We favor giving 

States the option to experiment and 

consider approaches that are uniquely 

suitable to a particular area, provided 

that such approaches do not result in 

imbalances in NOX regulation across the 

country. 

Some commenters were against 

option 3 because they believed EPA 

might require States to develop an 

alternative to increments. Our final 

action today does not require a State to 

develop an alternative to the NO2

increments. States have the flexibility to 

continue implementing the NO2

increments or to pursue approval of 

other measures besides increments that 

achieve the same objectives. 

Several commenters opposed option 3 

on the grounds that it would not 

provide adequate protection for parks 

and AQRVs. These commenters were 

concerned that option 3 did not account 

for a source’s distance and direction 

from a Class I area. The commenters 

indicated that these variables could 

have a major effect on whether a 

source’s NOX emissions adversely 

impact AQRVs. A State will be required 

to demonstrate that any alternative 

approach to increments protects parks 

and AQRVs. In addition, we recognized 

that an unresolved issue under our 

option 3 was the potential for localized 

adverse impacts. We will ensure that 

these issues are addressed before 

approving an individual program 

submission. 

One commenter suggested that State 

planning approach be used as the 

foundation of a broader regional strategy 

to address air quality impacts of NOX, 

and not only NO2. The commenter 

believed that larger regional issues 

could not be addressed under option 3, 

as proposed, given the increased 

population growth projected for western 

States and attendant growth of urban 

areas. Our intent with this regulation is 

to provide for the review of alternatives 

on a State-by-State basis. However, to 

the extent that groups of States wish to 

develop regional strategies, EPA will 

consider them to determine if they meet 

the requirements of the Act. In addition, 

we will continue to evaluate EPA’s 

options for promulgating regional 

strategies to address the commenter’s 

concerns. 

Tribal commenters were concerned 

that allowing States to implement 

alternatives to increment could threaten 

the tribes’ abilities to regulate their own 

environmental quality and expose tribal 

environmental resources to greater risk 

of pollution. These commenters also 

expressed a concern that such 

alternatives would be inconsistent with 

the Federal government’s trust 

responsibility to tribes. We do not 

believe this option will infringe the 

tribes’ abilities to regulate their 

environments, harm tribal 

environmental resources, or overlook 

the Federal government’s trust 

responsibility to federally-recognized 

tribes. At this point, it is difficult to 

determine whether a specific alternative 

program may affect adjacent areas, such 

as areas of Indian country. We want to 

emphasize, however, that any State’s 

alternative program will be carefully 

evaluated to address potential concerns 

that affected entities may have, whether 

it be another State, a tribal governing 

body, or an FLM for a nearby Class I 

area. Each State alternative program will 

be evaluated on a case-by-case basis and 

subjected to public review and comment 

as part of the SIP review and approval 

process. We believe that it is reasonable 

to expect that States will communicate 

and cooperate with other potentially 

affected governing entities as part of the 

process of developing an alternative 

program. In addition, any such 

alternative program would need to be 

approved by EPA. In determining 

whether to approve such programs, EPA 

would act consistent with the Federal 

government’s trust responsibility, 

including conducting appropriate 

consultation with tribes to help ensure 

that the interests of the tribes are 

considered in this process. Although no 

specific process has been established for 

tribes to consult with EPA on SIP 

approvals on a government-togovernment basis, we will endeavor to 

provide additional opportunities for 

consultation and continue to carefully 

consider comments submitted by tribal 

officials. This process should help 

ensure that all concerns are considered 

and that environmental resources are 

protected prior to approval of an 

alternative program through the SIP 

submittal process. 

3. Benefits of an Alternative Approach 

States have always had the option to 

submit alternative approaches in their 

SIPs that can be shown to be more 

effective than the minimum program 

elements established by EPA, but States 

may not have recognized that a system 

other than increments may be utilized to 

prevent significant deterioration from 

emissions of NOX. The alternative 

approach provides States with the 

flexibility to employ a program that may 

be more effective than increments in 

preventing significant deterioration of 

air quality from emissions of NOX. For 

example, a State could adopt an 

emissions reduction plan for NOX, 

under authority other than the PSD 

program, that limits NOX emissions 

from particular sources to a greater 

extent than would occur under an 

increment approach that focuses on 

marginal increase in emissions. 

In addition, although we believe the 

increment program is effective at 

limiting emissions increases, the 

process of tracking consumption of 

increment and modeling changes in 

emissions concentrations can be timeconsuming and resource-intensive. A 

State that employs an EPA-approved 

alternative approach to the NO2

increments program would not be 

required to maintain an NO2 increment 

inventory. In addition, PSD permit 

applicants in the State would not be 

required to conduct an individual 

analysis to demonstrate that they do not 

cause or contribute to a violation of the 

increments. Other measures would be 

used to fulfill the requirements of the 

Act. 

4. Future Actions Regarding 

Alternatives 

Although we are not outlining a 

specific alternative program at this time, 

we continue to see promise in using a 

cap and trade approach modeled on the 

CAIR to reduce NOX emissions in order 

to meet the goals of the PSD program for 

NOX. As a result, we intend to publish 

a supplemental notice of proposed 

rulemaking that will explore this option 

further. This notice will build on 

proposed option 2 and provide more 

details on how a State that achieves the 

NOX emissions reductions required 

under CAIR can fulfill the objectives of 

the PSD program, satisfy the statutory 

requirements of section 166 of the Act, 

and obviate the need to implement the 

NO2 increments program. 

VII. Measures Not Proposed as Options 

In the February 2005 proposal, we 

proposed not to use a ‘‘critical load’’ as 

a means of identifying an alternative 

increment level or to incorporate the 

concept of critical loads into the PSD 

regulations for NOX at the present time. 

Critical loads can be defined as 

‘‘quantitative estimates of an exposure 

to one or more pollutants below which 

significant harmful effects on specified 

sensitive elements of the environment 

do not occur according to present 

knowledge.’’ See 1995 Staff Paper for 

NOX at xi–xii. 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59613 

Our proposal not to incorporate 

critical loads into our pollutant-specific 

PSD regulations for NOX was based 

largely on our preliminary conclusion 

that the scientific basis for developing 

and applying critical loads was still 

emerging. We also raised an issue about 

critical loads that related to the possible 

use of critical loads to identify an 

alternative level for the existing NO2

increments. Because of the vastly 

differing sensitivities and potential 

effects associated with ecosystem 

resources in different regions of the 

United States, we expressed our belief 

that critical loads do not represent an 

appropriate tool for setting a single, 

uniform, national standard, such as a 

PSD increment level. 

We did acknowledge, however, that 

States could propose to use a critical 

loads concept. For example, where 

adequate information might be 

available, States could use critical loads 

as part of their own air quality 

management approaches, and EPA 

would consider it when determining 

whether the overall air quality 

management approach satisfied the PSD 

requirements. See 70 FR at 8914. 

Five commenters agreed with our 

assessment that it would not be 

appropriate at this time to use critical 

loads as part of the PSD regulations for 

NOX. These commenters generally 

agreed that the critical loads concept 

was not ready to be used for PSD 

purposes. In addition, some felt that it 

would be inappropriate for EPA to use 

critical loads as non-uniform national 

standards. One argued that the use of 

critical loads would improperly prohibit 

economic growth. 

On the other hand, nine commenters 

responded to our proposal by opposing 

our decision not to use critical loads in 

some way under the PSD regulations for 

NOX. These commenters recommended 

using critical loads as either complete 

replacements for the existing NO2

increments or as a supplemental 

measure for the increment approach. 

The comments recommending the use of 

critical loads as a supplemental measure 

suggested that critical loads could 

augment the proposed uniform NOX

increment approach by providing a tool 

through which permitting authorities 

could consider ecosystem changes in 

more sensitive areas. In such areas, they 

believed a critical load could provide a 

science-based target for protection. 

We agree that critical loads represent 

a promising mechanism for addressing 

environmental impacts associated with 

atmospheric nitrogen deposition. For 

example, once further developed, the 

critical load concept could potentially 

be used as a location-specific means to 

determine the goals of emissions control 

and management practices related to 

ecosystem protection. Clearly, the 

‘‘critical loads’’ concept is one way to 

describe the level at which a specific 

natural area or system is negatively 

impacted by air pollution. With 

sufficient information, critical load 

determinations for nitrogen deposition 

can be related to location-specific 

indicators of ecological change, such as 

episodic and chronic acidification of 

streams and rivers, chemical changes in 

soils, or nutrient enrichment and 

eutrophication. 

Over the past 20 years, the scientific 

community has gained increasing 

knowledge regarding the impacts of 

atmospheric emissions of certain criteria 

pollutants (NO2, SO2, and ozone) on 

natural systems. Studies that we 

reviewed as part of this rulemaking to 

determine the adequacy of the existing 

NO2 increments illustrate that scientists 

now understand that both ambient 

exposure to and deposition of various 

nitrogen compounds have gradually 

changed the ecological balance of 

natural systems in many areas of the 

United States. Detailed descriptions of 

the ecological effects of nitrogen 

deposition can be found in many of the 

studies that we examined as part of the 

review of the existing NO2 increments 

(see section V of this preamble), but in 

most every case it is not yet possible to 

quantify the levels of deposition 

responsible for such changes. 

Commenters did not provide any 

information to show us that sufficient 

information is available at this time to 

use the critical load concept as part of 

the national PSD program for NOX. 

Moreover, we believe that from the 

information that is available, because 

ecological systems are quite 

heterogeneous, critical loads would not 

serve as an appropriate replacement for 

the uniform national NO2 increments. 

However, if the science is further 

developed, we do agree with those 

commenters who suggest that locationspecific critical loads could be used 

effectively to augment the existing 

increment system for NOX at those 

locations. 

Two of the commenters supporting 

critical loads indicated that we should 

revise the existing NO2 increments and 

continue using the increment system as 

an interim approach, while studying the 

critical load concept for future 

implementation as part of the PSD 

program. These commenters agreed that 

ultimately the critical loads approach 

was the most effective way to protect 

the environment from the adverse 

effects of nitrogen deposition. Several 

other commenters also urged EPA to 

further study the critical loads concept 

by initiating pilot projects or a 

demonstration critical loads program by 

working with States, FLMs, tribes, and 

others to select natural areas where 

existing information is adequate to do 

so. 

We agree with the commenters 

recommending that the current 

increment system should continue to be 

applied under the PSD regulations for 

NOX. However, as explained in section 

VI, we do not agree that there is 

sufficient basis for modifying the 

existing NO2 increments. Therefore, 

under today’s final action, we are not 

modifying the existing NO2 increments, 

but retaining them at their existing 

levels and form. 

We do agree with commenters that 

further research is necessary and 

appropriate to further evaluate the 

critical loads concept. As mentioned 

above, in recent years, ecosystems 

research has produced findings that are 

sufficient to identify changes to many 

sensitive elements of the environment at 

specific locations resulting from 

atmospheric nitrogen deposition in its 

various forms. Nitrogen impacts have 

been documented in areas ranging from 

East Coast estuaries to high-elevation 

systems in the Colorado Front Range to 

southern California chaparral 

communities. Nitrogen deposition in 

these areas impacts diverse ecological 

communities ranging from fisheries to 

alpine lakes to grasslands. 

Even with advances in our 

understanding of nitrogen cycling in the 

environment, scientific challenges 

remain in relation to setting 

scientifically valid critical loads. These 

challenges include the following: 

• Data requirements and availability: 

Critical loads for acidification and 

nutrient-related ecosystem changes for 

sensitive aquatic and terrestrial systems 

depend on many ecosystem 

characteristics, compounded by the fact 

that these characteristics are 

heterogeneous across space. Such 

characteristics include topography, 

elevation, slope, bedrock geology, soil 

characteristics, soil chemistry, land use 

history, water body and watershed 

surface area, surface water chemistry, 

meteorology, climate, plant species 

composition, biomass, and plant 

nutrient concentrations. Depending on 

the critical loads calculation method 

used, some or all of the data described 

above are necessary inputs for 

establishing critical loads. Clearly, 

establishing critical loads is a very dataintensive exercise. The challenge will be 

to determine the amount and types of 

data that are necessary and available for 

59614 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

32Section 165(d)(2)(B) places an affirmative 

responsibility on FLMs to protect the AQRVs in 

Federal Class I areas. 

calculating critical loads at local to 

regional scales. 

• Multiple methods and models: In 

addition to data issues, the current 

multiplicity of methods for calculating 

critical loads poses a practical challenge 

that may complicate application of the 

critical loads approach for air quality 

management. At least three approaches 

are currently employed for calculating 

critical loads: empirical approaches in 

which critical loads are based on the 

relationship between an observed 

detrimental ecological effect and the 

deposition level at which the effect 

occurred; steady-state approaches using 

simple mass-balance models; and 

dynamic modeling approaches. While 

each approach has advantages and 

disadvantages, the National Research 

Council recently stated that reliance on 

steady-state models can introduce 

uncertainty into critical loads 

calculations and observed that ‘‘the 

numerous methods for calculating both 

critical loads and exceedance levels 

allow for inconsistency in 

implementation’’ (NRC, 2004). Model 

comparison efforts will help to resolve 

issues regarding critical load calculation 

approaches and enable evaluation of the 

data needs and relative applicability of 

steady-state and dynamic modeling 

approaches. 

• Critical load variations: Critical 

load values vary depending upon factors 

such as the ecosystem response of 

interest or the spatial context. At a given 

location, for example, critical loads can 

vary depending upon the ecosystem 

response indicator of interest—critical 

loads for soils are often different than 

critical loads for freshwater systems. 

Similarly, critical loads for an 

ecosystem response indicator may vary 

across local to regional spatial scales. 

The challenge will be to integrate localscale critical loads (e.g., for a Class I 

area) and regional-scale critical loads 

when implementing air quality 

management programs for ecosystem 

protection at multiple scales. 

We are aware that Federal land 

management agencies, other Federal and 

State agencies, and the scientific 

community have developed a 

substantial body of information related 

to nitrogen impacts for a limited number 

of site-specific ecosystems around the 

country. EPA will continue working to 

further develop the latest scientific 

research results and information to 

explore the critical loads approach to 

better manage air resources. 

We agree with commenters that it is 

possible that a critical load program 

could be developed by working 

collaboratively with States, tribes, and 

FLMs to implement ‘‘pilot projects’’ in 

selected areas where there may be 

sufficient information on nitrogen 

deposition and ecosystem effects to 

establish critical loads. Under this final 

rule, the Agency encourages States, 

tribes and FLMs to join with EPA in 

exploring the voluntary use of critical 

loads as a basis to address effects of 

nitrogen deposition on ecosystems for 

such areas. With appropriate public 

input, cooperative critical load projects 

could lead to implementation plans that 

demonstrate protection against 

deterioration of AQRVs from nitrogen 

impacts, eliminate the need for NO2

increment tracking, and reduce the 

extent of assessments needed for 

permitting new sources that may impact 

AQRVs in Class I areas. In addition, 

such an approach may fit within the 

structure of existing requirements. 

EPA will work with interested States, 

tribes, Federal land management 

agencies and others to identify the 

components needed to develop and 

implement cooperative projects to 

explore the feasibility and usefulness of 

a critical loads approach. EPA believes 

such projects are a means through 

which to explore whether a critical 

loads approach could be an efficient 

approach to ensure protection of 

ecosystems and other AQRVs as part of 

the existing increment system, and also 

meet other purposes of the Act. Such an 

approach could reduce the 

administrative burden on States and 

new sources. Collaborative efforts to 

explore a critical loads approach for 

nitrogen would provide insight into the 

general role of critical loads in future air 

quality management programs. 

The statutory PSD provisions 

authorize Federal land management 

agencies, including NPS and the U.S. 

Forest Service, to play a special role in 

protecting AQRVs in their Federal Class 

I lands.32 In this context, the FLMs are 

also responsible for identifying AQRVs 

in Class I areas and assessing whether 

they might be adversely impacted. For 

many Class I area parks and wilderness 

areas, FLMs have already identified the 

resources at risk from or sensitive to air 

pollution. In conjunction with this 

effort, FLMs recently have explored the 

use and setting of critical loads as a 

management tool to characterize the risk 

from air pollution emissions and 

deposition to ecological systems on 

Class I areas and Federal lands. (Porter, 

2005.) For example, they have used 

research on critical loads to assess 

ecosystem risk and to inform air quality 

management decisions related to new 

source permit reviews and comments on 

SIP pollution control strategies. These 

efforts could serve as the basis for 

continuing review and evaluation by a 

cooperative agreement with EPA, States 

and other interested parties. 

One commenter believed that EPA 

should elaborate on the way we 

envision States’ using critical loads 

within their State PSD programs. This 

commenter further believed that States 

should be encouraged to consider 

critical load data where such data 

indicate that the current NO2

increments and current permitting 

procedures are not providing adequate 

environmental protection. 

In our February 2005 proposal, we 

indicated that States, considering the 

state of the science, may propose use of 

critical load information as part of their 

air quality management approach. If 

such a proposal were made, EPA would 

consider it in determining whether the 

State’s approach satisfied its PSD 

requirements. We envision the 

development of critical loads to be a 

phased, ongoing process. As critical 

loads are calculated for specific 

receptors in a particular area, such as 

forest soils, or surface waters, using a 

dose-response relationship, and such 

critical loads are adequately peerreviewed, we encourage affected States 

to consider working closely with the 

applicable FLM to establish agreements 

and procedures for incorporating the 

critical load concept into their PSD 

permit process for protecting AQRVs. 

VIII. Statutory and Executive Order 

Reviews 

A. Executive Order 12866—Regulatory 

Planning and Review 

Under Executive Order 12866 (58 FR 

51735, October 4, 1993), the Agency 

must determine whether the regulatory 

action is ‘‘significant’’ and therefore 

subject to review by the Office of 

Management and Budget (OMB) and the 

requirements of the Executive Order. 

The Order defines ‘‘significant 

regulatory action’’ as one that is likely 

to result in a rule that may: 

(1) Have an annual effect on the 

economy of $100 million or more or 

adversely affect in a material way the 

economy, a sector of the economy, 

productivity, competition, jobs, the 

environment, public health or safety, or 

State, local, or tribal governments or 

communities; 

(2) Create a serious inconsistency or 

otherwise interfere with an action taken 

or planned by another agency; 

(3) Materially alter the budgetary 

impact of entitlements, grants, user fees, 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59615 

or loan programs, or the rights and 

obligations of recipients thereof; or 

(4) Raise novel legal or policy issues 

arising out of legal mandates, the 

President’s priorities, or the principles 

set forth in the Executive Order. 

Pursuant to the terms of Executive 

Order 12866, it has been determined 

that this rule is a ‘‘significant regulatory 

action’’ because the State planning 

option in the proposal raises novel legal 

and policy issues. As such, this action 

was submitted to OMB for review. 

Changes made in response to OMB 

suggestions or recommendations will be 

documented in the public record. 

B. Paperwork Reduction Act 

This action does not impose any new 

information collection burden. Under 

this final action, we are retaining the 

existing increments and regulatory 

framework of the PSD regulations for 

NOX. The Office of Management and 

Budget (OMB) has previously approved 

the information collection requirements 

contained in the existing regulations (40 

CFR parts 51 and 52) under the 

provisions of the Paperwork Reduction 

Act, 44 U.S.C. 3501, et seq., and has 

assigned OMB control number 2060–

0003, EPA ICR number 1230.17. A copy 

of the OMB-approved Information 

Collection Request (ICR) may be 

obtained from Susan Auby, Collection 

Strategies Division, U.S. Environmental 

Protection Agency (2822T), 1200 

Pennsylvania Ave., NW., Washington, 

DC 20460, or by calling (202) 566–1672. 

As an alternative to the existing 

increments, the State has discretion in 

developing an alternative option that 

satisfies both the requirements of the 

statutory PSD program requirements for 

NOX and the State’s air quality 

management goals. It is not possible to 

determine at this time what additional 

burdens, if any, a State alternative 

program may entail. 

Burden means the total time, effort, or 

financial resources expended by persons 

to generate, maintain, retain, or disclose 

or provide information to or for a 

Federal agency. This includes the time 

needed to review instructions; develop, 

acquire, install, and utilize technology 

and systems for the purposes of 

collecting, validating, and verifying 

information, processing and 

maintaining information, and disclosing 

and providing information; adjust the 

existing ways to comply with any 

previously applicable instructions and 

requirements; train personnel to be able 

to respond to a collection of 

information; search data sources; 

complete and review the collection of 

information; and transmit or otherwise 

disclose the information. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a currently valid OMB 

control number. The OMB control 

numbers for EPA’s regulations in 40 

CFR are listed in 40 CFR part 9. 

C. Regulatory Flexibility Act (RFA) 

EPA has determined that it is not 

necessary to prepare a regulatory 

flexibility analysis in connection with 

this final rule. 

For purposes of assessing the impacts 

of today’s final rule on small entities, 

small entity is defined as: (1) A small 

business as defined by the Small 

Business Administration’s (SBA) 

regulations at 13 CFR 121.201; (2) a 

small governmental jurisdiction that is a 

government of a city, county, town, 

school district or special district with a 

population of less than 50,000; or (3) a 

small organization that is any not-forprofit enterprise which is independently 

owned and operated and is not 

dominant in its field. 

After considering the economic 

impacts of today’s final rule on small 

entities, EPA has concluded that this 

action will not have a significant 

economic impact on a substantial 

number of small entities. We are 

imposing no new requirements on small 

entities. We are retaining existing 

regulations without change and thus 

imposing no new requirements on small 

entities. Optionally, we allow States to 

adopt alternative programs to relieve the 

burden of conducting specific ambient 

air quality and increment analyses 

under the PSD program. However, 

States do not meet the definition of a 

small entity under the RFA. 

D. Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA), Pub. L. 

104–4, establishes requirements for 

Federal agencies to assess the effects of 

their regulatory actions on State, local, 

and tribal governments and the private 

sector. Under section 202 of the UMRA, 

EPA generally must prepare a written 

statement, including a cost-benefit 

analysis, for proposed and final rules 

with ‘‘Federal mandates’’ that may 

result in expenditures to State, local, 

and tribal governments, in the aggregate, 

or to the private sector, of $100 million 

or more in any one year. 

Before promulgating an EPA rule for 

which a written statement is needed, 

section 205 of the UMRA generally 

requires EPA to identify and consider a 

reasonable number of regulatory 

alternatives and adopt the least costly, 

most cost-effective, or least burdensome 

alternative that achieves the objectives 

of the rule. The provisions of section 

205 do not apply when they are 

inconsistent with applicable law. 

Moreover, section 205 allows EPA to 

adopt an alternative other than the least 

costly, most cost-effective, or least 

burdensome alternative if the 

Administrator publishes with the final 

rule an explanation why that alternative 

was not adopted. 

Before EPA establishes any regulatory 

requirements that may significantly or 

uniquely affect small governments, 

including tribal governments, it must 

have developed under section 203 of the 

UMRA a small government agency plan. 

The plan must provide for notifying 

potentially affected small governments, 

enabling officials of affected small 

governments to have meaningful and 

timely input in the development of EPA 

regulatory proposals with significant 

Federal intergovernmental mandates, 

and informing, educating, and advising 

small governments on compliance with 

the regulatory requirements. 

Today’s final action contains no 

Federal mandates (under the regulatory 

provisions of Title II of the UMRA) for 

State, local, or tribal governments or the 

private sector. The final rule imposes no 

enforceable duty on any State, local or 

tribal governments or the private sector. 

We are retaining existing 

requirements and do not impose any 

new Federal mandates. New rule 

language authorizes States to adopt an 

alternative approach to meeting some of 

the rule’s requirements, but States have 

had such authority under the CAA and 

are not required to adopt an alternative 

approach if they choose to continue 

implementing the existing program 

provisions. In any event, EPA has 

determined that this final rule does not 

contain a Federal mandate that may 

result in expenditures of $100 million or 

more for State, local, and tribal 

governments, in the aggregate, or in the 

private sector in any one year. Thus, 

today’s final rule is not subject to the 

requirements of sections 202 and 205 of 

the UMRA. 

Because we have not required any 

new Federal mandates, EPA has also 

determined that this rule contains no 

regulatory requirements that might 

significantly or uniquely affect small 

governments. 

E. Executive Order 13132—Federalism 

Executive Order 13132, entitled 

‘‘Federalism’’ (64 FR 43255, August 10, 

1999), requires EPA to develop an 

accountable process to ensure 

‘‘meaningful and timely input by State 

and local officials in the development of 

regulatory policies that have federalism 

implications.’’ ‘‘Policies that have 

59616 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

federalism implications’’ is defined in 

the Executive Order to include 

regulations that have ‘‘substantial direct 

effects on the States, on the relationship 

between the national government and 

the States, or on the distribution of 

power and responsibilities among the 

various levels of government.’’

This final rule does not have 

federalism implications. The rule will 

not have substantial direct effects on the 

States, on the relationship between the 

national government and the States, or 

on the distribution of power and 

responsibilities among the various 

levels of government, as specified in 

Executive Order 13132. If the existing 

regulations for increments are retained, 

no new regulatory requirements will be 

imposed on States. Optionally, this final 

action permits States to obtain relief 

from certain regulatory requirements by 

adopting alternative programs but does 

not necessarily require adoption of a 

new program in that a State may rely on 

a program that is already in place or that 

is required by other EPA requirements. 

Direct compliance costs associated with 

today’s rule could be incurred when 

States incorporate any changes into 

their SIPs, but these direct compliance 

costs would not be significant. Thus, 

Executive Order 13132 does not apply 

to this final rule. 

F. Executive Order 13175—Consultation 

and Coordination With Indian Tribal 

Governments 

Executive Order 13175, entitled 

‘‘Consultation and Coordination with 

Indian Tribal Governments’’ (65 FR 

67249, November 9, 2000), requires EPA 

to develop an accountable process to 

ensure ‘‘meaningful and timely input by 

tribal officials in the development of 

regulatory policies that have tribal 

implications.’’ This final rule does not 

have tribal implications, as specified in 

Executive Order 13175. No tribes are 

currently implementing the PSD 

program. Furthermore, this final rule 

does not impose any new regulatory 

restrictions. In this final action, EPA is 

retaining the existing NO2 increments 

and making explicit that States 

implementing the PSD program have the 

option to seek EPA approval of an 

alternative program that meets the 

objectives of the PSD program without 

using increments. At the time it reviews 

any alternative PSD program for NOX

submitted by a State, EPA will assess 

whether such program has tribal 

implications. However, the final action 

we are taking today does not have a 

substantial direct effect on tribes. Thus, 

Executive Order 13175 does not apply 

to this final rule. Although Executive 

Order 13175 does not apply to this rule, 

EPA has considered comments 

submitted by several tribal officials. A 

summary of the concerns raised in these 

comments and EPA’s response to those 

concerns is provided in EPA’s 

Comment-Response Document located 

in the docket for this rule. 

G. Executive Order 13045—Protection of 

Children From Environmental Health 

and Safety Risks 

Executive Order 13045, ‘‘Protection of 

Children from Environmental Health 

Risks and Safety Risks’’ (62 FR 19885, 

April 23, 1997), applies to any rule that: 

(1) Is ‘‘economically significant’’ as 

defined under Executive Order 12866; 

and (2) concerns an environmental 

health or safety risk that EPA has reason 

to believe may have a disproportionate 

effect on children. If the regulatory 

action meets both criteria, the Agency 

must evaluate the environmental health 

or safety effects of the planned rule on 

children and explain why the planned 

regulation is preferable to other 

potentially effective and reasonably 

feasible alternatives considered by the 

Agency. 

This final rule is not subject to the 

Executive Order because it is not 

economically significant as defined in 

Executive Order 12866, and because the 

Agency does not have reason to believe 

the environmental health or safety risks 

of NOX addressed by this action present 

a disproportionate risk to children. The 

final rule retains existing regulations 

and does not impose any new regulatory 

requirements. States may obtain relief 

from certain regulatory requirements by 

choosing to adopt alternative programs. 

H. Executive Order 13211—Actions 

That Significantly Affect Energy Supply, 

Distribution, or Use 

This rule is not a ‘‘significant energy 

action’’ as defined in Executive Order 

13211, ‘‘Actions Concerning Regulations 

That Significantly Affect Energy Supply, 

Distribution, or Use’’ (66 FR 28355, May 

22, 2001), because it is not likely to have 

a significant adverse effect on the 

supply, distribution, or use of energy. 

The final rule retains existing 

regulations and does not impose any 

new regulatory requirements. States 

may obtain relief from certain regulatory 

requirements by choosing to adopt 

alternative programs. This option does 

not impose any new requirements but 

rather allows States to obtain regulatory 

flexibility by implementing alternative 

requirements. Further, we have 

concluded that this rule is not likely to 

have any adverse energy effects. 

I. National Technology Transfer and 

Advancement Act 

As noted in the February 2005 

proposal, section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (‘‘NTTAA’’), Pub. L. 104–

113, 12(d) (15 U.S.C. 272 note), directs 

EPA to use voluntary consensus 

standards in its regulatory activities 

unless to do so would be inconsistent 

with applicable law or otherwise 

impractical. Voluntary consensus 

standards are technical standards (e.g., 

materials specifications, test methods, 

sampling procedures, and business 

practices) that are developed or adopted 

by voluntary consensus standards 

bodies. The NTTAA directs EPA to 

provide Congress, through OMB, 

explanations when the Agency decides 

not to use available and applicable 

voluntary consensus standards. This 

final rule does not involve technical 

standards. Therefore, EPA did not 

consider the use of any voluntary 

consensus standards. 

J. Executive Order 12898—Federal 

Actions To Address Environmental 

Justice in Minority Populations and 

Low-Income Populations 

Executive Order 12898 requires that 

each Federal agency make achieving 

environmental justice part of its mission 

by identifying and addressing, as 

appropriate, disproportionate high and 

adverse human health or environmental 

effects of its programs, policies, and 

activities on minorities and low-income 

populations. The EPA concluded that 

this final rule should not raise any 

environmental justice issues. 

K. Congressional Review Act 

The Congressional Review Act, 5 

U.S.C. 801 et seq., as added by the Small 

Business Regulatory Enforcement 

Fairness Act of 1996, generally provides 

that before a rule may take effect, the 

agency promulgating the rule must 

submit a rule report, which includes a 

copy of the rule, to each House of the 

Congress and to the Comptroller General 

of the United States. EPA will submit a 

report containing this rule and other 

required information to the U.S. Senate, 

the U.S. House of Representatives, and 

the Comptroller General of the United 

States prior to publication of the rule in 

the Federal Register. A major rule 

cannot take effect until 60 days after it 

is published in the Federal Register. 

This action is not a ‘‘major rule’’ as 

defined by 5 U.S.C. 804(2). Therefore, 

this action will be effective November 

14, 2005. 

Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 59617 

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List of Subjects in 40 CFR Part 51 

Environmental protection, 

Administrative practices and 

procedures, Air pollution control, 

59618 Federal Register / Vol. 70, No. 196 / Wednesday, October 12, 2005 / Rules and Regulations 

Intergovernmental relations, Nitrogen 

oxides, Ozone, Particulate matter, 

Reporting and recordkeeping 

requirements. 

Dated: September 29, 2005. 

Stephen L. Johnson, 

Administrator. 

■ For the reasons set out in the 

preamble, title 40, chapter I of the Code 

of Federal Regulations is amended as 

follows: 

PART 51—[AMENDED] 

■ 1. The authority citation for part 51 

continues to read as follows: 

Authority: 23 U.S.C. 101; 42 U.S.C. 7401–

7671 q. 

Subpart I—[Amended] 

■ 2. Section 51.166 is amended by 

revising paragraph (c) to read as follows: 

§ 51.166 Prevention of significant 

deterioration of air quality. 

* * * * * 

(c) Ambient air increments and other 

measures. (1) The plan shall contain 

emission limitations and such other 

measures as may be necessary to assure 

that in areas designated as Class I, II, or 

III, increases in pollutant concentrations 

over the baseline concentration shall be 

limited to the following: 

Pollutant 

Maximum 

allowable 

increase 

(micrograms 

per cubic 

meter) 

Class I 

Particulate matter: 

PM10, annual arithmetic 

mean .......................... 4 

PM10, 24-hr maximum ... 8 

Sulfur dioxide: 

Annual arithmetic mean 2 

24-hr maximum ............. 5 

3-hr maximum ............... 25 

Nitrogen dioxide: 

Annual arithmetic mean 2.5 

Class II 

Particulate matter: 

PM10, annual arithmetic 

mean .......................... 17 

PM10, 24-hr maximum ... 30 

Sulfur dioxide: 

Annual arithmetic mean 20 

24-hr maximum ............. 91 

3-hr maximum ............... 512 

Nitrogen dioxide: 

Annual arithmetic mean 25 

Class III 

Particulate matter: 

PM10, annual arithmetic 

mean .......................... 34 

Pollutant 

Maximum 

allowable 

increase 

(micrograms 

per cubic 

meter) 

PM10, 24-hr maximum ... 60 

Sulfur dioxide: 

Annual arithmetic mean 40 

24-hr maximum ............. 182 

3-hr maximum ............... 700 

Nitrogen dioxide: 

Annual arithmetic mean 50 

For any period other than an annual 

period, the applicable maximum 

allowable increase may be exceeded 

during one such period per year at any 

one location. 

(2) Where the State can demonstrate 

that it has alternative measures in its 

plan other than maximum allowable 

increases that satisfy the requirements 

in sections 166(c) and 166(d) of the 

Clean Air Act for nitrogen oxides, the 

requirements for maximum allowable 

increases for nitrogen dioxide under 

paragraph (c)(1) of this section shall not 

apply upon approval of the plan by the 

Administrator. 

* * * * * 

[FR Doc. 05–20110 Filed 10–11–05; 8:45 am] 

BILLING CODE 6560–50–P