Document ID: EPA-R07-OAR-2006-0467-0014
Agency: epa
Document Type: Rule
Title: Approval and Promulgation of Implementation Plans; State of Missouri
Posted Date: 2006-08-15T04:00Z

[Federal Register: August 15, 2006 (Volume 71, Number 157)]
[Rules and Regulations]               
[Page 46860-46864]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15au06-5]                         

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R07-OAR-2006-0467; FRL-8209-9]

 
Approval and Promulgation of Implementation Plans; State of 
Missouri

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is taking final action to approve Missouri's nitrogen 
oxides (NOX) plan for the eastern one-third of the state. 
The plan consists of three rules, a budget demonstration, and 
supporting documentation. The plan will contribute to attainment and 
maintenance of the 8-hour ozone standard in several downwind areas. 
Missouri's plan, which focuses on large electric generating units, 
large industrial boilers, large stationary internal combustion engines, 
and large cement kilns, was developed to meet the requirements of EPA's 
April 21, 2004, Phase II NOX State Implementation Plan (SIP) 
Call. EPA is taking final action to approve the plan as a SIP revision 
fulfilling the NOX SIP Call requirements. The initial period 
for compliance under the plan will begin in 2007, and the emission 
monitoring and reporting requirements for sources holding allowances 
under the plan began on May 1, 2006.

DATES: This rule is effective on September 14, 2006.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. EPA-R07-OAR-2006-0467. All documents in the docket are listed on 
the http://www.regulations.gov Web site. Although listed in the index, 

some information is not 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 through 
http://www.regulations.gov or in hard copy at the Environmental 

Protection Agency, Air Planning and Development Branch, 901 North 5th 
Street, Kansas

[[Page 46861]]

City, Kansas 66101. The Regional Office's official hours of business 
are Monday through Friday, 8:00 to 4:30 excluding Federal holidays. The 
interested persons wanting to examine these documents should make an 
appointment with the office at least 24 hours in advance.

FOR FURTHER INFORMATION CONTACT: Michael Jay at (913) 551-7460, or by 
e-mail at jay.michael@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document whenever ``we,'' 
``us,'' or ``our'' is used, we mean EPA.

I. Background
II. Summary of State Submittal
    A. What Are the Basic Components of the State's Plan?
    B. What Do the Rules Require?
    1. What Are the Requirements of the EGU and Non-EGU Rule?
    2. What Are the Requirements of the Cement Kiln Rule?
    3. What Are the Requirements of the Large Stationary Internal 
Combustion Engine Rule?
    C. How Does Missouri Address Its NOX SIP Call Budget?
III. What Action Is EPA Taking?
IV. Statutory and Executive Order Reviews

I. Background

    By notice dated October 27, 1998 (63 FR 57356), we took final 
action to prohibit specified amounts of emissions of one of the main 
precursors of groundlevel ozone, NOX, in order to reduce 
ozone transport across state boundaries in the eastern half of the 
United States. We set forth requirements for each of the affected 
upwind states to submit SIP revisions prohibiting those amounts of 
NOX emissions during the five-month period from May 1 
through September 30 which significantly contribute to downwind air 
quality problems. We established statewide NOX emissions 
budgets for the affected states. The budgets were calculated by 
assuming the emissions reductions that would be achieved by applying 
available, highly cost-effective controls to source categories of 
NOX, i.e., the amounts of reductions determined by EPA for 
large, fossil-fuel-fired electric generating units (EGUs), large, 
fossil-fuel-fired industrial boilers, combustion turbines, and combined 
cycle systems (non-EGUs), large stationary internal combustion (IC) 
engines, and cement kilns. States have the flexibility to adopt the 
appropriate mix of controls for their state to meet the NOX 
emissions reductions requirements of the NOX SIP Call.
    A number of parties, including certain states as well as industry 
and labor groups, challenged our NOX SIP Call rule. A 
subsequent ruling by the Court of Appeals for the District of Columbia 
Circuit on March 3, 2000, vacated the inclusion of the entire state of 
Missouri. Michigan v. EPA, 213 F.3d 663 (DC Cir. 2000). In response to 
the Court's decision, we issued the February 22, 2002, proposed rule to 
include only specified counties in the eastern one-third of Missouri in 
the NOX SIP Call (67 FR 8413).
    On April 21, 2004, we finalized our responses to the Court's 
decision in a final rulemaking, ``Interstate Ozone Transport: Response 
to Court Decisions on the NOX SIP Call, NOX SIP 
Call Technical Amendments, and Section 126 Rules,'' also referred to as 
``Phase II of the NOX SIP Call'' (69 FR 21604). This 
rulemaking made a number of revisions to the 1998 rule. Most relevant 
to this rulemaking, it finalized our earlier proposal to include only 
the eastern one-third of Missouri in the NOX SIP Call. 
Accordingly, consistent with the Court's finding in Michigan, 
Missouri's NOX emissions budget was revised to include only 
the eastern one-third of the state.
    The NOX SIP Call requires that states revise their SIPs 
to assure that sources in the state reduce their NOX 
emissions sufficiently to eliminate the amounts of NOX 
emissions that contribute significantly to ozone nonattainment, or that 
interfere with maintenance, downwind, as required under the Clean Air 
Act (CAA) section 110(a)(2)(D)(i)(I). States must demonstrate that 
their SIP includes sufficient measures to eliminate the significant 
amount of emissions by providing documentation in the form of a budget 
demonstration that details how the reductions are to be achieved. The 
total amount of NOX emissions from all NOX 
sources remaining after the state prohibits the significant amount of 
NOX emissions, as identified in the NOX SIP Call, 
represents the emissions budget for the state.
    The NOX SIP Call provided states the flexibility to 
decide which source categories to regulate in order to meet the 
emissions budget. In order to provide assistance to the states, we 
suggested imposing a variety of control strategies that provide for a 
highly cost effective means for states to meet their NOX 
emissions budgets. These strategies include imposing NOX 
emissions caps and providing for an allowance trading program for large 
EGUs and large non-EGUs, as well as emission reduction requirements for 
cement kilns and large IC engines. EPA's model NOX budget 
trading rule for SIPs, 40 CFR Part 96, Subparts A through I, sets forth 
a NOX allowance trading program for large EGUs and large 
non-EGUs. A state can voluntarily choose to adopt EPA's model rule in 
order to allow sources within its borders to participate in regional 
allowance trading as a way to achieve the required emission reductions 
for large EGUs and large non-EGUs. The October 27, 1998, Federal 
Register document contains a full description of the EPA's model 
NOX budget trading program (See 63 FR 57514-57538 and 40 CFR 
Part 96, Subparts A through I). It should be noted that Missouri 
currently has in place a SIP-approved statewide NOX Rule, 10 
CSR 10-6.350, and is also in the process of adopting additional rules 
to meet the requirements of the Clean Air Interstate Rule (CAIR). The 
statewide NOX rule and the rules under development to meet 
CAIR are designed to meet different EPA requirements.

II. Summary of State Submittal

A. What Are the Basic Components of the State's Plan?

    The main components of Missouri's plan include three NOX 
rules and a budget demonstration with supporting materials. The rules 
include: 10 CSR 10-6.360, pertaining to large EGUs and large fossil-
fuel-fired industrial boilers (industrial boilers), 10 CSR 10-6.380 for 
cement kilns, and 10 CSR 10-6.390 for large stationary internal 
combustion engines. The purpose of these rules is to prohibit 
NOX emissions as identified in the NOX SIP Call 
that significantly contribute to downwind ozone nonattainment. In the 
NOX SIP Call the required emissions reductions were 
determined based on the implementation of available, highly cost-
effective controls for selected source categories. Therefore, Missouri 
has developed and adopted three rules generally covering the source 
categories (i.e., large EGUs, large industrial boilers, cement kilns, 
and large stationary IC engines) for which EPA found that cost-
effective controls were available.\1\ EPA has reviewed the three rules 
and has found that Missouri's rules will achieve the emission reduction 
requirements of the NOX SIP Call and thus eliminate 
Missouri's significant contribution to downwind 8-hour ozone 
nonattainment. A more detailed description of each rule follows under 
II(B). The purpose of the budget demonstration is to provide an

[[Page 46862]]

accounting mechanism for ensuring that Missouri has adopted control 
measures that prohibit the significant amounts of NOX 
emissions targeted by CAA section 110(a)(2)(D)(i)(I). A more detailed 
discussion of the demonstration is provided below under II(C).
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    \1\ Although in the NOX SIP Call, EPA found generally 
that highly cost effective reductions were achievable at large 
industrial boilers, combustion turbines, and combined cycle systems, 
the fine grid portion of Missouri does not include existing large 
combustion turbines and combined cycle systems. The language of the 
applicability provisions for non-EGUs in Missouri's trading rule 
expressly covers only large non-EGUs that are industrial boilers.
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B. What Do the Rules Require?

1. What Are the Requirements of the EGU and Non-EGU Rule?
    Missouri adopted 10 CSR 10-6.360 ``Control of NOX 
Emissions From Electric Generating Units and Non-Electric Generating 
Boilers.'' The rule effectively adopts the essential elements of EPA's 
NOX Budget Trading model rule set forth in the October 1998 
Federal Register document for applicable sources found in the eastern 
one-third of the state covered by the NOX SIP Call. The 
Missouri rule affects large EGUs (in general, fossil-fuel-fired 
boilers, combustion turbines, and combined cycle systems that serve a 
generator with a nameplate capacity greater than 25 megawatts (MWe) 
producing electricity for sale) and large industrial boilers 
(generally, industrial fossil-fuel-fired boilers with a maximum design 
heat input greater than 250 million British thermal units per hour 
(mmBtu/hr)).\2\
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    \2\ It should be noted that as described in the proposal, EPA 
interprets ``nameplate capacity'' to be the amount, specified by the 
manufacturer of the generator, as of initial installation and 
interprets ``maximum design heat input'' to be the amount, specified 
by the manufacturer of the unit, as of initial installation based on 
the physical design and physical characteristics of the equipment. 
Consequently, nameplate capacity and maximum design heat input are 
determined on a one-time basis and are not changed by subsequent 
modification of the generator or unit respectively.
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    The emissions cap on large EGUs for the eastern one-third of 
Missouri, as described in the Phase II notice, is set at 13,400 tons 
per ozone season, and was based on a baseline heat input (mmBtu/hr) and 
emissions rate of 0.15 NOX lbs/mmBtu. The EGU emissions 
budget is equivalent to the number of allowances that the state has 
authority to distribute. One percent of this budget, 134 tons, has been 
included in an ``energy efficiency and renewable generation projects 
set-aside.'' The purpose of this set-aside is to provide an incentive 
to save or generate electricity through the implementation of projects 
that reduce the consumption of fossil-fuel. The rule contains a list of 
large EGUs and the number of remaining allowances that will be provided 
for each unit during the control periods beginning in the year 2007.
    The level of reduction for large industrial boilers was based on 
emissions decreases from uncontrolled levels. In accordance with the 
NOX SIP Call, Missouri based the number of NOX 
allowances for each unit on a 60 percent reduction from each unit's 
estimated 2007 levels of emissions, which were adjusted for projected 
growth for large industrial boilers. Missouri identified three existing 
units in the eastern one-third of the state as meeting the 
applicability requirement for large industrial boilers and, based on 
reductions from their uncontrolled emissions adjusted for projected 
growth, established 59 tons as the large industrial boiler portion of 
the trading budget. The rule specifically allocates allowances to these 
three large industrial boilers. The NOX trading budget for 
Missouri is the sum of the large EGU budget (13,400) and the large 
industrial boiler budget (59) and totals 13,459 tons.
    Under 10 CSR 10-6.360, Missouri allocates NOX allowances 
to both its large EGUs and large industrial boilers. Each 
NOX allowance permits a unit to emit one ton of 
NOX during the ozone season control period. NOX 
allowances may be bought or sold. Unused NOX allowances may 
also be banked for future use, with certain limitations. Missouri's 
rule requires each large EGU and large industrial boiler to hold 
allowances to cover its emissions after each control period. For each 
ton of NOX emitted in a control period, EPA will remove one 
allowance from the unit's NOX Allowance Tracking System 
account after the end of the control period. Once the allowance has 
been used for compliance, no unit can use the allowance again. 
Monitoring requirements specify that owners and operators will be 
required to continuously monitor their NOX emissions by 
using systems that meet the requirements of 40 CFR part 75, subpart H. 
The monitoring requirements also include quarterly emission reporting.
    The compliance supplement pool (CSP) is a pool of allowances that 
can be used in the beginning of the program to provide certain 
NOX Budget units additional compliance flexibility. The CSP 
was created to address concerns raised by commenters on the 
NOX SIP Call proposal regarding electric reliability during 
the initial years of the program. Missouri may distribute its 5,630 ton 
allowance pool based on early reductions, a demonstrated need, or both. 
A unit making an application to the CSP based on early reductions must 
demonstrate that reductions were made beyond all applicable 
requirements sometime during the ozone seasons of 2002 through 2006. 
Missouri's CSP may be used to account for emissions during the 2007 and 
2008 control periods.
2. What Are the Requirements of the Cement Kiln Rule?
    Missouri adopted 10 CSR 10-6.380, ``Control of NOX 
Emissions From Portland Cement Kilns.'' The rule effectively adopts the 
NOX SIP Call's recommended approach of obtaining a 30 
percent reduction from uncontrolled levels from large Portland cement 
kilns found in the NOX SIP Call region of the eastern one-
third of the state. The rule applies only to kilns with process rates 
of at least the following:

Long dry kilns--12 tons per hour (TPH)
Long wet kilns--10 TPH
Preheater kilns--16 TPH
Precalciner and preheater/precalciner kilns--22 TPH

    In the NOX SIP Call, EPA cited its peer reviewed 
analysis, ``EPA's Alternative Control Techniques (ACT)'' (EPA-453/R-94-
004, March 1994) as demonstrating that cost-effective controls in the 
form of low-NOX burners and mid-kiln firing are available to 
the cement kiln industry and can achieve a 30 percent reduction from 
uncontrolled levels of emissions. Consistent with EPA's approach in the 
NOX SIP Call, Missouri's rule provides that compliance can be achieved 
by the installation and operation of low-NOX burners or mid-
kiln firing or by alternative measures that are all designed to achieve 
the 30 percent cost-effective reduction.
3. What Are the Requirements of the Large Stationary Internal 
Combustion Engine Rule?
    Missouri adopted 10 CSR 10-6.390, ``Control of NOX 
Emissions From Large Stationary Internal Combustion Engines.'' The rule 
effectively adopts the NOX SIP Call's recommended approach 
of the establishment of emissions levels that obtain an 82 percent 
reduction from large natural gas-fired stationary IC engines and a 90 
percent reduction from large diesel and dual fuel stationary IC engines 
found in the NOX SIP Call region of the eastern one-third of 
the state.

C. How Does Missouri Address Its NOX SIP Call Budget?

    Missouri's budget for the NOX SIP Call was contained in 
the Phase II rulemaking in April 2004. Today's rulemaking finalizes 
EPA's proposal to adopt corrections to the April 2004 budget for 
Missouri that were detailed in the June 5, 2006, proposal, as no 
comments were received on any of the proposed revisions. Based on EPA's 
approach in the proposal, the NOX SIP

[[Page 46863]]

Call 2007 budget for the eastern one-third of Missouri is 60,235 tons 
per ozone season and represents the sum of EGU, Non-EGU Point, Area, 
Off-Road and Mobile source emissions. A breakdown of the emissions 
budget can be found in Table I.
    As explained in more detail in the NOX SIP Call, the 
NOX SIP Call requires that states revise their SIPs to 
assure that sources in the state reduce their NOX emissions 
sufficiently to eliminate the amounts of NOX emissions that 
contribute significantly to ozone nonattainment, or that interfere with 
maintenance, downwind. The amount of NOX emissions 
reductions required is the amount of emissions reductions that would be 
achieved by applying available, highly cost-effective controls to large 
EGUs, large non-EGUs, large stationary IC engines, and cement kilns. 
However, EPA structured the rule to give the upwind states a choice of 
which mix of measures to adopt in order to eliminate the significant 
amount of NOX emissions. To this end, EPA developed an 
emissions budget that was based on the aforementioned application of 
highly cost-effective controls. The emissions budget represents the 
amount of NOX emissions remaining after the state prohibits 
the significant amount. EPA finds that Missouri has demonstrated 
compliance with the budget demonstration, and thus the NOX 
SIP Call, by adopting control measures that are modeled after EPA's 
recommended approach for controlling large EGUs, large non-EGUs, large 
IC engines, and cement kilns, and that implementation of these rules 
will achieve the emissions reductions necessary to eliminate the 
``significant contribution'' to downwind ozone nonattainment identified 
under CAA section 110(a)(2)(D)(i)(I), as implemented by the 
NOX SIP Call.

               Table I.--Corrected NOX Budget for Missouri
------------------------------------------------------------------------
                                                            2007 Budget
                     Source category                         emissions
                                                              (tpos)
------------------------------------------------------------------------
Large EGUs (>25 MW).....................................          13,400
Other EGUs..............................................             241
Other Non EGUs..........................................           5,903
Large non-EGUs (including large industrial boilers)                   59
 (>250 MMBtu)...........................................
Cement Kilns............................................           7,483
Area....................................................           2,199
On Road Mobile..........................................          21,318
Off-Road Mobile.........................................           9,632
                                                         ---------------
    Total...............................................          60,235
------------------------------------------------------------------------

III. What Action Is EPA Taking?

    EPA is taking final action to approve Missouri's request to revise 
the SIP to include their NOX plan that includes three 
NOX rules and a budget demonstration to meet the 
requirements of the NOX SIP Call. EPA proposed to approve 
the rules and budget demonstration on June 5, 2006 (71 FR 32291). The 
comment period closed on EPA's proposal on July 5, 2006. No comments 
were received. EPA is finalizing the approval as proposed, based on the 
rationale stated in the proposal and in this final action. Also, as 
explained in the proposal, EPA's approval is premised on Missouri's 
commitment to include in the Missouri trading rule any large industrial 
combustion turbines and large industrial combined cycle systems which 
may be constructed in the future.

Statutory and Executive Order Reviews

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
action is not a ``significant regulatory action'' and therefore is not 
subject to review by the Office of Management and Budget. For this 
reason, this action is also not subject to Executive Order 13211, 
``Actions Concerning Regulations That Significantly Affect Energy 
Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001). This action 
merely approves state law as meeting Federal requirements and imposes 
no additional requirements beyond those imposed by state law. 
Accordingly, the Administrator certifies that this rule will not have a 
significant economic impact on a substantial number of small entities 
under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). Because 
this rule approves pre-existing requirements under state law and does 
not impose any additional enforceable duty beyond that required by 
state law, it does not contain any unfunded mandate or significantly or 
uniquely affect small governments, as described in the Unfunded 
Mandates Reform Act of 1995 (Public Law 104-4).
    This rule also does not have tribal implications because it will 
not have a substantial direct effect on one or more Indian tribes, on 
the relationship between the Federal Government and Indian tribes, or 
on the distribution of power and responsibilities between the Federal 
Government and Indian tribes, as specified by Executive Order 13175 (65 
FR 67249, November 9, 2000). This action also does not have Federalism 
implications because it does 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 (64 
FR 43255, August 10, 1999). This action merely approves a state rule 
implementing a Federal standard, and does not alter the relationship or 
the distribution of power and responsibilities established in the Clean 
Air Act. This rule also is not subject to Executive Order 13045 
``Protection of Children from Environmental Health Risks and Safety 
Risks'' (62 FR 19885, April 23, 1997), because it is not economically 
significant.
    In reviewing SIP submissions, EPA's role is to approve state 
choices, provided that they meet the criteria of the Clean Air Act. In 
this context, in the absence of a prior existing requirement for the 
State to use voluntary consensus standards (VCS), EPA has no authority 
to disapprove a SIP submission for failure to use VCS. It would thus be 
inconsistent with applicable law for EPA, when it reviews a SIP 
submission, to use VCS in place of a SIP submission that otherwise 
satisfies the provisions of the Clean Air Act. Thus, the requirements 
of section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (15 U.S.C. 272 note) do not apply. This rule does not 
impose an information collection burden under the provisions of the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).
    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).
    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the appropriate circuit by October 16, 2006. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect the finality of this rule for the purposes of judicial 
review nor does it extend the time within which a petition for judicial 
review may be filed, and

[[Page 46864]]

shall not postpone the effectiveness of such rule or action. This 
action may not be challenged later in proceedings to enforce its 
requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, 
Incorporation by reference, Intergovernmental relations, Lead, Nitrogen 
dioxide, Ozone, Particulate matter, Reporting and recordkeeping 
requirements, Sulfur oxides, Volatile organic compounds.

    Dated: August 8, 2006.
William A. Spratlin,
Acting Regional Administrator, Region 7.

0
Chapter I, Title 40 of the Code of Federal Regulations is amended as 
follows:

PART 52--[AMENDED]

0
1. The authority citation for Part 52 continues to read as follows:

    Authority: 42 U.S.C. 7401 et seq.

Subpart AA--Missouri

0
2. In Sec.  52.1320(c) the table is amended under Chapter 6 by adding 
entries for ``10-6.360,'' ``10-6.380,'' and ``10-6.390'' to read as 
follows:

Sec.  52.1320  Identification of plan.

* * * * *
    (c) * * *

                                        EPA-Approved Missouri Regulations
----------------------------------------------------------------------------------------------------------------
                                                               State
       Missouri  citation                 Title           effective date  EPA approval  date      Explanation
----------------------------------------------------------------------------------------------------------------
                                    Missouri Department of Natural Resources

                                                  * * * * * * *
    Chapter 6--Air Quality Standards, Definitions, Sampling and Reference Methods, and Air Pollution Control
                                     Regulations for the State of Missouri

                                                  * * * * * * *
10-6.360.......................  Control of NOX                 10/30/05  8/15/06 [insert FR  ..................
                                  Emissions From                           page number where
                                  Electric Generating                      the document
                                  Units and Non-Electric                   begins].
                                  Generating Boilers.
10-6.380.......................  Control of NOX                 10/30/05  8/15/06 [insert FR  ..................
                                  Emissions From                           page number where
                                  Portland Cement Kilns.                   the document
                                                                           begins].
10-6.390.......................  Control of NOX                 10/30/05  8/15/06 [insert FR  ..................
                                  Emissions From Large                     page number where
                                  Stationary Internal                      the document
                                  Combustion Engines.                      begins].

                                                  * * * * * * *
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* * * * *
 [FR Doc. E6-13347 Filed 8-14-06; 8:45 am]

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