Document ID: EPA-R02-OAR-2005-VI-0001-0001
Agency: epa
Document Type: Proposed Rule
Title: Clean Air Act Section 325 Exemption for Virgin Islands Water and Power Authority
Posted Date: 2006-12-13T05:00Z

[Federal Register: December 13, 2006 (Volume 71, Number 239)]
[Proposed Rules]               
[Page 74886-74895]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr13de06-25]                         

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 69

[Docket No. EPA-R02-OAR-2005-VI-0001, FRL-8254-6]

 
Clean Air Act Section 325 Exemption for Virgin Islands Water and 
Power Authority

AGENCY: Environmental Protection Agency.

ACTION: Proposed Grant of Petition under section 325 of the Clean Air 
Act.

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SUMMARY: The Environmental Protection Agency is proposing to grant, 
with conditions, a Petition, from the Governor of the Virgin Islands, 
submitted under section 325 of the Clean Air Act (CAA). The Petition 
requests that EPA exempt the Virgin Islands Water and Power Authority 
(VIWAPA) from its obligation to comply with the continuous emission 
monitoring system (CEMS) conditions contained in Prevention of 
Significant Deterioration (PSD) permits issued pursuant to section 165 
of the CAA to VIWAPA for nine PSD permitted units

[[Page 74887]]

located on St. Thomas and St. Croix at two of its facilities.
    This approval will exempt VIWAPA from its obligation to comply for 
a period of five (5) years with the PSD permit CEMS conditions at seven 
of its eight PSD permitted combustion turbines and at its two PSD 
permitted Heat Recovery Steam Generator (HRSG) units. These PSD permit 
CEMS conditions address monitoring of Nitrogen Oxides (NOX), 
Carbon Monoxide (CO) and opacity emissions. Additionally, VIWAPA sought 
to extend the Petitioner's request to include waiver of PSD permit CEMS 
conditions for a new unit, Unit 23. While this approval will not exempt 
VIWAPA from the CEMS obligations for Unit 23, it does provide VIWAPA 
additional time to comply with the CEMS permit conditions.
    This approval may be revoked or modified if significant changes in 
circumstances occur at either one or both of the two VIWAPA facilities. 
Failure to comply with the conditions included in this approval at 
Section VII (Conditions of Approval), hereinafter called 
``Conditions,'' could result in the approval of the exemption being 
revoked by the Administrator as well as civil and/or criminal 
enforcement action under the Clean Air Act.

DATES: Comments must be received on or before January 12, 2007.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R02-
OAR-2005-VI-0001, by one of the following methods:
     http://www.regulations.gov: Follow the on-line 

instructions for submitting comments.
     E-mail: Eng.Ken@epa.gov.
     Fax: 212-637-3998.
     Mail: Kenneth Eng, Chief, Air Compliance Branch, 
Environmental Protection Agency, Region 2 Office, 290 Broadway, 21st 
Floor, New York, New York 10007-1866.
     Hand Delivery: Kenneth Eng, Chief, Air Compliance Branch, 
Environmental Protection Agency, Region 2 Office, 290 Broadway, 21st 
Floor, New York, New York 10007-1866. Such deliveries are only accepted 
during the Regional Office's normal hours of operation. The Regional 
Office's official hours of business are Monday through Friday, 8:30 
a.m. to 4:30 p.m. excluding Federal holidays
    Instructions: Direct your comments to Docket ID No. EPA-R02-OAR-
2005-VI-0001. EPA's policy is that all comments received will be 
included in the public docket without change and may be made available 
online at http://www.regulations.gov, including any personal 

information provided, unless the comment includes information claimed 
to be Confidential Business Information (CBI) or other information 
whose disclosure is restricted by statute. Do not submit information 
that you consider to be CBI or otherwise protected through 
http:.www.regulations.gov or e-mail. The http://www.regulations.gov Web 

site is an ``anonymous access'' system, which means EPA will not know 
your identity or contact information unless you provide it in the body 
of your comment. If you send an e-mail comment directly to EPA without 
going through http://www.regulations.gov your e-mail address will be 

automatically captured and included as part of the comment that is 
placed in the public docket and made available on the Internet. If you 
submit an electronic comment, EPA recommends that you include your name 
and other contact information in the body of your comment and with any 
disk or CD-ROM you submit. If EPA cannot read your comment due to 
technical difficulties and cannot contact you for clarification, EPA 
may not be able to consider your comment. Electronic files should avoid 
the use of special characters, any form of encryption, and be free of 
any defects or viruses. For additional information about EPA's public 
docket visit the EPA Docket Center homepage at http://www.epa.gov/epahome/dockets.htm
.

    Copies of the Governor's Petition, additional submittals relied 
upon in evaluating this Petition, and the Technical Support Document 
explaining the Environmental Protection Agency's rationale are 
available on line at http://www.regulations.gov in docket EPA-R02-OAR-

2005-VI-0001 and at the following address for inspection during normal 
business hours: Environmental Protection Agency, Region 2 Office, Air 
Compliance Branch, 290 Broadway, 21st Floor, New York, New York 10007-
1866, Attn: Gaetano LaVigna, (212) 637-4069.

FOR FURTHER INFORMATION CONTACT: Gaetano LaVigna, Air Compliance 
Branch, Environmental Protection Agency, Region 2 Office, 290 Broadway, 
21st Floor, New York, New York 10007-1866, (212) 637-4069 or at 
LaVigna.Gaetano@epa.gov.

SUPPLEMENTARY INFORMATION: The following table of contents describes 
the format for the Supplementary Information section:

I. What Action is the Environmental Protection Agency (EPA) Taking 
Today?
II. What are the Regulatory Requirements for Authorizing an 
Exemption under the Clean Air Act?
III. What are the Bases for the Petitioner's Request and what is 
EPA's Analysis of the Petition?
IV. What are Grounds for Revocation of the Exemption?
V. What is EPA's Conclusion?
VI. What is the Effective Date of the Approval of Petition and 
Timing of the Requirements?
VII. What are the Conditions of Approval?
VIII. Statutory and Executive Order Review

I. What Action is the Environmental Protection Agency (EPA) Taking 
Today?

    EPA is proposing a five (5) year approval, with Conditions, of the 
Governor of the Virgin Islands' March 7, 2002 Clean Air Act (CAA) 
section 325 Petition (``Petition''). On behalf of the Virgin Islands 
Water and Power Authority (VIWAPA or ``the Authority''), the Governor 
of the Virgin Islands requested that the Authority be exempted from 
continuous emission monitoring system (CEMS) conditions, which are 
contained in Prevention of Significant Deterioration (PSD) permits 
issued to VIWAPA pursuant to section 165 of the CAA. If finally 
approved, this exemption will become effective for a period of five (5) 
years from the date of final publication.
    For the effective period of the exemption, VIWAPA will not be 
required to comply with the CEMS conditions in its PSD permits for 
seven of its PSD permitted combustion turbines and its two PSD 
permitted Heat Recovery Steam Generating (HRSG) units. EPA is not 
granting the Petition with respect to the newly permitted eighth 
combustion turbine, Unit 23. However, the exemption provides VIWAPA 
additional time to comply with the CEMS conditions in its PSD permit 
for Unit 23, as delineated in the Conditions provided in Section VII. 
The PSD permit CEMS conditions relate to monitoring of NOX, 
CO and opacity emissions. All of the units subject to this proposed 
approval are located at VIWAPA's two facilities in St. Thomas and St. 
Croix. Failure to comply with the Conditions could result in the 
exemption being revoked by the Administrator as well as civil and/or 
criminal enforcement action under the CAA.
    The Petitioner's request, supporting documents submitted and 
presentations given by VIWAPA are summarized in this notice and 
detailed in a Technical Support Document available from EPA at the 
addresses listed above.

[[Page 74888]]

II. What are the Regulatory Requirements for Authorizing an Exemption 
Under the CAA?

    Section 325(a) of the CAA authorizes the Administrator of EPA, upon 
a Governor's petition, to exempt any person or source or class of 
persons or sources in the U.S. Virgin Islands, Guam, American Samoa, or 
the Commonwealth of the Northern Mariana Islands from CAA requirements 
other than section 112 or any requirements of section 110 or part D of 
subchapter I of the CAA necessary to attain or maintain a national 
primary ambient air quality standard (NAAQS). EPA may grant a petition 
for exemption if the Administrator finds that compliance with such a 
requirement is not feasible or is unreasonable due to unique 
geographical, meteorological, or economic factors of such territory, or 
other local factors that the Administrator deems significant. The CAA 
further provides that any such petition shall be considered in 
accordance with section 7607(d) of the Act and any exemption granted 
shall be considered final action by the Administrator for the purposes 
of section 7607(b) of the CAA.
    Further, EPA is required to notify the Committees on Energy and 
Commerce and on Natural Resources of the House of Representatives and 
the Committees on Environment and Public Works and on Energy and 
Natural Resources of the Senate upon receipt of a petition under 
section 325(a) of the CAA and upon approval or rejection of a petition 
under section 325(a). EPA notified the appropriate committees and will 
also notify them upon final action on this Petition.

III. What are the Bases for the Petitioner's Request and What Is EPA's 
Analysis of the Petition?

    The Governor in his Petition and VIWAPA in support of the Petition 
seek a CAA section 325 exemption from its PSD permit CEMS conditions 
because, they argue, compliance with these conditions is not feasible 
or reasonable due to unique geographical, meteorological, economic and 
other local factors in the Virgin Islands. The Petition and VIWAPA 
provide a number of arguments in support of an approval of an 
exemption. EPA analyzed each basis for the Petitioner's and VIWAPA's 
request as follows:

A. Attainment and Maintenance of National Ambient Air Quality Standards

    Pursuant to section 325 of the Act, the Administrator is not 
authorized to exempt a source from requirements under CAA section 110 
or part D of subchapter I of the Act necessary to attain or maintain a 
national primary ambient air quality standard (NAAQS). Therefore, 
whether the requested exemptions will result in nonattainment of a 
NAAQS is a threshold requirement for consideration of this, and any 
other, CAA section 325 petition. This threshold requirement was 
addressed in the Petition and in subsequent information provided by 
VIWAPA.
    Because EPA had obtained modeling data from another facility 
suggesting that the Island of St. Croix may be close to exceeding the 
NAAQS for NOX, EPA requested and reviewed new NOX 
modeling data submitted by VIWAPA. EPA sought to determine whether the 
Air Quality Control Regions of both St. Croix and St. Thomas as well as 
the Class I area of St. John would still be in attainment if EPA were 
to approve the Petition for exemption. One of VIWAPA's PSD permits 
requires that the nitrogen content of the fuel oil be no greater than 
150 ppm. VIWAPA's exclusive fuel oil supplier indicated that it can no 
longer supply VIWAPA fuel oil with a nitrogen content specified in the 
PSD permit. VIWAPA's supplier will only guarantee fuel oil with a 
nitrogen content of no more than 1,000 ppm. Therefore, VIWAPA submitted 
air modeling of the potential emissions from combustion of fuel with a 
nitrogen content of up to 1,000 ppm. The modeling demonstrates that 
properly controlled use of fuel oil with a nitrogen content of 1,000 
ppm at VIWAPA's two facilities will not cause an exceedance of the 
NAAQS. The modeling demonstrates that VIWAPA has met this threshold 
requirement for consideration of the Petition.

B. Statutory and Regulatory Authority for Requiring CEMS

    The Petitioner contends that there is no statutory or regulatory 
requirement that mandates the use of CEMS. However, the units in 
question are subject to PSD. In PSD permits, like the ones issued to 
VIWAPA, EPA routinely requires the use of CEMS to directly and 
continuously measure emissions as a means of determining compliance 
with PSD Best Available Control Technology (BACT) limits. In the VIWAPA 
permits, EPA established BACT limits for NOX and CO and set 
limits for opacity and required CEMS to ensure compliance with these 
limits. EPA's 1990 Draft New Source Review Workshop Manual indicates 
that continuous and quantitative measurements be obtained where 
feasible; if not, surrogate parameters must be expressed in the permit. 
EPA has consistently applied this policy in its issuance of PSD 
permits.
    In reviewing VIWAPA's PSD applications for its PSD affected units, 
EPA determined that VIWAPA had not demonstrated that continuous, 
quantitative measurements are infeasible, therefore all of VIWAPA's PSD 
permits include CEMS requirements to ensure that VIWAPA continually 
meets the BACT limits established in its PSD permits.

C. Unique Geographical Location as it Relates to Difficulties in 
Obtaining and Retaining CEMS Operators and Contractors

    The Petitioner and VIWAPA indicate that because VIWAPA is located 
approximately 1,100 miles from the mainland of the United States, the 
Authority has had significant difficulties hiring full-time qualified 
technical and engineering personnel to maintain and service CEMS at the 
VIWAPA facilities. In addition they indicate that when necessary, the 
Authority had been unable to timely obtain contractor assistance due to 
difficulties in contractors obtaining flights. Furthermore, the 
Petitioner and VIWAPA assert that there are no locally available 
vendors that can provide hardware and/or software service. In addition, 
the Petitioner and VIWAPA indicated that off-Island contractors are not 
always available for the extra two (2) days needed to travel to and 
from the Virgin Islands.
    EPA investigated the Petitioner's and VIWAPA's assertions, and has 
determined that while some of VIWAPA's difficulties are attributable to 
its location, its difficulties with contractors are more likely 
attributable to other issues discussed in later sections. In addition, 
even sources on the mainland are located in areas which are difficult 
to get to within a day. Thus, while EPA recognizes that the travel 
distance presents some support for the exemption, it would not, on its 
own, be a sufficient basis for approval of the exemption.

D. VIWAPA's Financial Condition as it Relates to Difficulties in 
Obtaining and Retaining CEMS Operators and Contractors

    Documents provided by VIWAPA show that it often cannot pay its 
contractors on a timely basis. The Virgin Islands Government frequently 
delays payments to VIWAPA which, in turn, delays payments to its 
contractors. This leads to difficulties in retaining contractors, 
resulting in poorly maintained equipment. EPA recognizes

[[Page 74889]]

that VIWAPA's financial circumstances create difficulties in obtaining 
and retaining CEMS expertise. EPA has determined that these 
difficulties warrant a five (5) year approval of the Petition, with the 
Conditions specified in Section VII.

E. Summary of Difficulties in Obtaining and Retaining Expertise To 
Manage and Maintain Old CEMS

    VIWAPA identified numerous difficulties in obtaining and retaining 
qualified technical and engineering personnel and contractors to 
maintain and service its CEMS and related data acquisition software. 
VIWAPA's CEMS vendor indicated to EPA that it is no longer providing 
hardware and software services for VIWAPA's old CEMS because its staff 
is no longer trained in supporting systems that are as old as the ones 
in place at VIWAPA. VIWAPA has told EPA that it does not have trained 
in-house personnel to manage and maintain these systems, and has 
indicated that there are no local vendors available to provide such 
hardware and software service, and there exists no alternatives for 
VIWAPA to keep these old CEMS-related equipment operating. Based upon 
VIWAPA's representations as well as our discussions with VIWAPA's CEM's 
vendor, EPA agrees that VIWAPA is likely to experience continued 
difficulties in obtaining and retaining expertise to manage and 
maintain the current antiquated CEMS.

F. Other Relevant Financial Considerations

    The Petitioner stated that VIWAPA's ``scarce resources should not 
be wasted on unnecessary and unreliable monitoring.'' EPA does not 
agree that such monitoring is unnecessary and unreliable. Monitoring is 
a necessary tool for determining compliance with the PSD permit 
emission limits. VIWAPA also contends that the CEMS replacement alone 
will cost between $900,000 and $1,600,000. EPA hired a financial 
analyst to review VIWAPA's financial statements, annual budgets and 
other documents submitted in support of the Petition's position on 
financial considerations. The analyst determined that the cost of 
installation, operation and maintenance of the PSD-required CEMS is 
financially feasible. EPA also researched the costs of replacement and 
determined them unlikely to be as high as VIWAPA stated.

G. Current Condition of PSD Permit-Required CEMS and Supporting 
Software

    The Petitioner and VIWAPA stated that the monitors and data 
acquisition system (DAS), which are installed on all but the newly 
permitted and constructed Unit 23, have reached the end of their useful 
lives. The NOX, CO and old opacity CEMS have been unable to 
meet the minimum monitor availability requirements and the monitors 
themselves have not been functioning properly, in part, because of 
excessive stack flexing and vibration resulting in improper alignment, 
etc. EPA's position is that CEMS replacement is expected during the 
life of a combustion turbine, as is servicing and repair of CEMS in 
order to comply with PSD permit CEMS conditions. EPA has decided that 
during the period of the exemption, VIWAPA shall make necessary 
improvements to its gas turbines and their associated stacks, to 
address the problems that adversely impacted on the operation of the 
CEMS at the PSD-permitted units. Addressing the problems and improving 
the alternative monitoring system (AMS) will facilitate better 
operation and maintenance of new generation CEMS that will be installed 
in the future.

H. Attempts To Replace PSD Permit-Required CEMS

    Prior to the Governor's submission of the Petition, VIWAPA sent out 
an RFP for purchase, installation and support of new CEMS. Vendors 
responding to the RFP indicated that they could not fully accept the 
terms specified in the RFP. Upon reviewing the RFP, EPA found that the 
RFP required not only that a vendor install, operate and maintain the 
CEMS in compliance with the PSD permits, but also that the vendor bear 
the liability of any civil penalties resulting from noncompliance with 
the PSD permits. EPA determined that this was an unreasonable 
requirement to place in the RFP and that it created a barrier to 
engaging a CEMS replacement contractor. The Agency also has determined 
that commercially available CEMS are far more reliable and easier to 
operate than the monitors and data acquisition systems that VIWAPA 
currently operates; therefore, VIWAPA should be able to operate these 
systems with relatively fewer difficulties. EPA concluded that a 
permanent exemption from the CEMS conditions is not warranted based on 
VIWAPA's prior contracting experience with vendors. However, as stated 
in section III(G), above, a five (5) year exemption will provide 
sufficient time for VIWAPA to improve its facilities and, in 
particular, its turbines, so that they can effectively use new monitors 
and data acquisition systems.

I. Proposed Alternative Monitoring

    The Petitioner and VIWAPA propose using an alternative monitoring 
system (AMS) in lieu of compliance with the PSD permit-required CEMS. 
EPA determined that using the AMS system instead of CEMS for monitoring 
NOX emissions is acceptable for a five (5) year period 
provided VIWAPA monitors its compliance by conducting visible emission 
readings, performing stack testing and using the portable analyzers. 
The AMS would compare the actual water and/or steam injection rates 
with the injection rates established through the permit-required stack 
testing as well as the stack testing conditions in this proposed 
exemption. The AMS includes an alarm system to alert operating 
personnel trained to respond whenever operating levels approach or 
exceed permit limits. This exemption conditions the use of the proposed 
AMS on specific improvements to include recording the hours of 
operation, turbine operation load, compliance parameters, and minimum 
data availability requirements. The exemption also includes additional 
conditions on reporting and recordkeeping to alleviate any ambiguity as 
to required submissions and the schedule for such submissions.
    The Agency is proposing additional periodic monitoring conditions, 
including the use of portable analyzers to measure CO, O2 
and NOX emissions from the stacks. In addition, the Agency 
also has determined that the exemption will require annual stack tests, 
as discussed in the Governor's petition. During stack testing, VIWAPA 
shall establish additional parameters that correlate with compliance 
and VIWAPA shall add these parameters to its automated AMS. Properly 
operated, an improved AMS should provide necessary compliance 
information during the five (5) year period of the exemption and 
provide a foundation for determining compliance with the PSD limits 
after the exemption terminates. VIWAPA may choose to terminate the AMS 
upon implementing CEMS in compliance with Section 165 PSD permit 
requirements, this may occur prior to but not later than the end of the 
five (5) year period of the exemption.

J. Fuel Supply Changes

    As stated earlier, VIWAPA indicated that its fuel supplier is 
currently able to guarantee fuel oil with no greater than 1,000 ppm 
nitrogen, rather than fuel oil

[[Page 74890]]

with 150 ppm nitrogen-in-fuel content used to establish the BACT limits 
in all of VIWAPA's PSD permits other than Unit 23. While EPA has 
reviewed and analyzed modeling and other information that VIWAPA 
provided in support of the Governor's Petition regarding VIWAPA's use 
of fuel oil with greater than 150 ppm nitrogen content, the Agency is 
not approving such a fuel change in this exemption. Action on the 
section 325 Petition is not the appropriate forum for EPA approval of 
PSD permit modification requests. VIWAPA has recently submitted an 
application to revise its PSD permits to reflect the higher nitrogen 
fuel that is presently being combusted. The Agency is currently 
evaluating this application.

K. Status of Recently Installed Opacity CEMS

    VIWAPA argues that, due to geographic and financial difficulties, 
it is currently unable to obtain appropriate contractor support for a 
CEMS data acquisition system necessary to collect CEMS data including 
data relating to opacity monitoring. EPA includes visible emission (VE) 
reading requirements in this exemption in lieu of operating the Opacity 
CEMS. The Agency determined that for the duration of the approval, 
VIWAPA should be exempted from its obligation to comply with PSD 
conditions relating to opacity CEMS in part because the Agency 
recognized that it would take time to improve the physical condition of 
the older existing gas turbines and their associated stacks (e.g., 
reduce excessive stack vibration, stack flexing, and maintain proper 
alignment, etc.), which adversely affects the performance of the 
opacity monitors. The temporary exemption allows VIWAPA time to improve 
the condition of the older existing turbines so that they will not 
contribute to poor performance of new opacity CEMS.

L. VIWAPA's Request for Consideration of Exemption From Obligation To 
Comply With Unit 23 PSD Permit CEMS Conditions

    Although the Governor submitted the Petition prior to the 
construction of Unit 23, VIWAPA claims that the request for an 
exemption from CEMS requirements was non-specific and applies to all of 
its PSD permitted units. Representatives of the Governor's office and 
VIWAPA have repeatedly asserted in subsequent meetings and 
correspondence with EPA that the Petition also applies to Unit 23. 
Accordingly, EPA reviewed information provided by VIWAPA relating to 
the possibility of exempting the Authority from compliance with CEMS 
conditions in Unit 23's PSD permit.
    The Agency is not convinced that an exemption of Unit 23 CEMS is 
justified. Current generation CEMS and DAS are much easier to operate 
and maintain than those currently in place at VIWAPA's other units. 
Since Unit 23 is new, it does not suffer from the various operational 
problems of the older turbines and its condition will not have a 
negative impact on the operation of CEMS. Moreover, EPA has determined 
that by operating CEMS at Unit 23, VIWAPA will gain the knowledge and 
experience that will assist it in phasing in CEMS installation and 
operation at all its units. However, although EPA is not exempting Unit 
23 from the CEMS requirements, the exemption provides VIWAPA additional 
time to fully comply with the CEMS installation and operation 
requirements in its PSD permit for Unit 23. The Conditions pertaining 
to Unit 23 are delineated in section VII, entitled ``Conditions of 
Approval.''

IV. What are Grounds for Revocation of the Exemption?

    This approval may be revoked or modified in whole or in part, by 
the Administrator, if significant changes in circumstances at the 
facility occur, if significant violations of the exemption occur, or if 
significant changes in the factual circumstances upon which the 
approval is based occur. These changes include, but are not limited to, 
changes in commitments and modeling information made in the Petition or 
in support of the Petition, changes at the facility or in the status of 
the Air Quality Control Region, changes in financial status, and 
changes in ownership (including privatization--in whole or in part) 
that could have an impact upon the facilities' finances or ability to 
hire and retain technical and engineering personnel.
    Significant violations also include, but are not be limited to, 
failures to meet any and all conditions of this exemption, such as 
stack testing, periodic monitoring, improvement of the AMS and water 
injection system, and failures to adhere to established compliance 
parameters. The exemption requires VIWAPA to bring any such changes to 
the attention of the Agency for review as soon as practicable.
    In addition to revocation and/or modification, failure to comply 
with the Conditions could result in civil and/or criminal enforcement 
action under the CAA.

V. What is EPA's Conclusion?

    Based on EPA's review of the Petition, information and 
presentations provided in support of this Petition, EPA has determined 
that VIWAPA's unique geographical location and financial circumstances 
have caused it difficulties in operating existing CEMS at its older 
turbines and difficulties in obtaining and retaining contractors and 
staff with expertise to operate and maintain the CEMS. EPA is, 
therefore, proposing to approve, with Conditions specified in Section 
VII, the Governor's Petition for exemption for a period of five (5) 
years. The approval will exempt VIWAPA from its obligation to comply 
with the PSD permit CEMS conditions at seven of its eight PSD permitted 
combustion turbines and at its two PSD permitted HRSG units. These PSD 
permit CEMS conditions address monitoring of NOX, CO and 
opacity emissions. During the five (5) year period of the exemption, 
VIWAPA is required, in accordance with good air pollution control 
practice, to make improvements to its facilities, including but not 
limited to the turbines, necessary to ensure proper operation of new 
generation CEMS upon termination of this exemption. Additionally, the 
Administrator is providing, in this notice, a set period of time for 
VIWAPA to comply with its PSD permit CEMS requirements for Unit 23, as 
delineated in the Conditions. During the period of this exemption, it 
is EPA's expectation that VIWAPA's staff will gain the necessary 
experience to properly operate and maintain such equipment at Unit 23, 
and then apply this knowledge to the operation of CEMS at the rest of 
their units upon termination, if not earlier, of this exemption.
    In summary, the Conditions require: (a) Improvements to VIWAPA's 
AMS and water injection system; (b) initial and periodic (annual) stack 
tests, (c) ongoing portable analyzer monitoring, (d) visible emissions 
readings, (e) record keeping and reporting, and (f) planning for and 
installation of new CEMS.
    One of the reasons for EPA's inclusion of Conditions to the 
exemption relating to stack testing and portable analyzer monitoring in 
conjunction with AMS and water injection system improvement is to 
ensure the creation and maintenance of operating parameters which 
accurately correlate with VIWAPA's operating conditions at the time of 
opacity, NOX and CO limit compliance demonstrations made 
during compliance tests conducted in accordance with the New Source 
Performance Standards, PSD and this exemption.

[[Page 74891]]

VI. What is the Effective Date of the Approval of Petition and Timing 
of the Requirements?

    The effective date of the approval is the date of final publication 
of the EPA exemption in the Federal Register. The exemption will be in 
effect for a period of five (5) years from such date. Under the 
proposed exemption, VIWAPA will be allowed to discontinue operation of 
its CEMS at all of the PSD affected units, except for Unit 23, which is 
being provided a limited time to achieve permanent, consistent 
compliance with its PSD permit CEMS conditions, as delineated in 
section VII, below.
    Once VIWAPA complies with conditions 2, 3, 4, 6, 7, 8, 9, 10, 11 
and 23, operation of CEMS at PSD permitted units other than Unit 23 can 
be discontinued. VIWAPA shall submit Monthly Status Reports delineating 
its progress in complying with these Conditions. Once VIWAPA has 
complied with the above conditions, VIWAPA shall submit Quarterly 
Reports as directed in the Conditions.

VII. What are the Conditions of Approval?

Conditions of Approval

    All of the units affected by this exemption, with the exception of 
Unit 23, are subject to conditions 1-32, and conditions 36 and 37 
below. The Unit 23 conditions are separately specified. Condition 38 
applies to all units. The Conditions are to be in effect for a period 
of no more than five (5) years from the effective date of the approval.
    VIWAPA shall conduct initial stack testing, prior to the 
discontinuation of the CEMS operation, to establish the water and fuel 
injection rates as well as to establish additional compliance 
monitoring parameters and their associated compliance values. VIWAPA 
shall monitor all of these parameters using its alternate monitoring 
system. Any necessary changes to accommodate monitoring of these 
parameters shall be in place prior to discontinuation of the CEMS 
operation. In addition, a number of Conditions require other methods of 
monitoring in lieu of the CEMS operation. These monitoring measures 
shall be available and in place prior to discontinuation of the CEMS 
operation. For example, the exemption requires VIWAPA to purchase 
portable analyzers as well as to submit for EPA approval a sampling 
protocol for use of the portable analyzers. In addition, the exemption 
requires VIWAPA to have certified visible emissions readers available 
on staff to conduct required visible emissions readings. Furthermore, 
the exemption requires VIWAPA to complete a third-party audit of the 
water injection system to identify any problems associated with the 
operation of the system and to correct these problems. Proper operation 
of the water injection system is critical because it is the only form 
of control of NOX emissions from the affected units.
    Once VIWAPA has complied with conditions 2, 3, 4, 6, 7, 8, 9, 10, 
11, and 23, the operation of the CEMS at PSD permitted units other than 
Unit 23 can be discontinued. VIWAPA shall submit Monthly Status Reports 
delineating its progress in complying with these specific conditions 
until the specific conditions have been adequately addressed. 
Thereafter, VIWAPA shall submit Quarterly Reports on ongoing compliance 
with these conditions.

Heat Recovery Steam Generator (HRSG) Stack Damper

    1. VIWAPA shall demonstrate that, prior to required stack testing, 
during simple cycle operation, no air flow goes to the HRSG. Provisions 
for making this demonstration shall be included in the stack test 
protocol submitted for performance testing. This is necessary to show 
that all emissions are correctly recorded by the CEMS when the monitors 
are reinstalled. In addition, VIWAPA has agreed and the exemption 
requires the elimination of the capability of firing fuel in the HRSG 
unit for turbines 15 and 18. VIWAPA shall eliminate the capability of 
firing fuel in the HRSG unit for turbines 15 and 18. Within one hundred 
twenty (120) days of the approval of the exemption, VIWAPA shall 
provide to EPA a certification signed by a corporate representative 
indicating that the capability to fire fuel in the HRSG for turbines 15 
and 18 has been eliminated.

Stack Testing

    2. VIWAPA shall plan, conduct, and report upon stack emission tests 
to be conducted at each PSD permitted gas turbine. VIWAPA shall conduct 
stack tests initially within thirty (30) days of EPA protocol approval. 
VIWAPA shall complete no later than one hundred eighty (180) days from 
publication of the final approval of the Petition, and shall repeat 
stack testing every twelve (12) months thereafter. VIWAPA shall provide 
EPA at least two (2) weeks notice prior to the date proposed for 
conducting stack tests.
    3. VIWAPA shall submit stack testing protocols covering all testing 
scenarios and all parameters to be tested and measured (including load, 
fuel bound nitrogen, and all AMS parameters, including but not limited 
to water/steam and fuel rates) to EPA for review, revision and approval 
at least sixty (60) days before each stack test. VIWAPA may, at its 
option, submit a separate protocol for each test or combined protocols 
covering more than one unit. If combined protocols are submitted, 
VIWAPA shall submit for each unit, separate sections, figures, and/or 
tables clearly indicating the specific unit, load, fuel, AMS, stack and 
sampling configurations and all other unit-specific information. VIWAPA 
shall conduct stack tests for each PSD permitted gas turbine during at 
least the four loads required by NSPS Subpart GG, or more, as specified 
in VIWAPA's current PSD permit. VIWAPA shall include in the stack 
testing protocols, provisions for verifying that all flow from units 
connected to the HRSG passes through the turbine stack in simple cycle 
mode.
    4. VIWAPA shall conduct stack tests to determine compliance with 
PSD NOX, and CO emissions limits, and opacity limits as well 
as to establish and then assure maintenance of AMS compliance 
parameters, which shall be utilized to ensure Federal enforceability. 
VIWAPA's Title V permits also require these tests as well as stack 
tests for VOC, PM and PM10.
    5. VIWAPA shall determine the nitrogen content of fuel combusted 
during stack testing using any of the following ASTM Test Methods: 
D2597-94 (reapproved 1994), D6366-99, D4629-02, or D5762-02.
    6. VIWAPA shall recalibrate the water injection system before each 
stack test. VIWAPA shall establish new compliance parameter values 
including but not limited to water-to-fuel ratios after each stack 
test. Periods in which compliance parameters are exceeded shall be 
considered violations of the NOX limit.

Periodic Monitoring

    7. VIWAPA shall purchase two (2) Portable Flue Gas Emission 
Analyzers, one each for its St. Thomas and St. Croix facilities. In 
addition to these analyzers, VIWAPA shall purchase all appropriate 
calibration and operational equipment and supplies, and thereafter 
shall maintain a sufficient inventory of such on each island. VIWAPA 
shall calibrate and operate the instruments in accordance with the 
manufacturer's instructions. VIWAPA shall monitor every week for 
NOX, CO, O2 and SO2 emissions from the 
stack of each PSD affected gas turbine ``available to operate'' 
(excluding units that are ``down for service'') and that operate a 
minimum of five (5) hours per week. VIWAPA shall sample the nitrogen 
content of the fuel combusted at the

[[Page 74892]]

time of portable analyzer monitoring. VIWAPA shall submit a sampling 
protocol which includes a monitoring period it believes acceptable for 
determining compliance. This protocol is subject to EPA review, 
revision and approval. Should any concentrations measured by the 
portable analyzer be in excess of the emission limits in the applicable 
permit, VIWAPA shall make any adjustments necessary to the affected 
unit to return it to compliance with the emission limit. Within two (2) 
days of making any necessary adjustments, VIWAPA shall re-monitor the 
affected unit, in accordance with the protocol, to demonstrate 
compliance with the emission limit. VIWAPA shall continue this process 
until VIWAPA achieves compliance with each PSD-permit emission limit.
    After VIWAPA demonstrates continual compliance with the emission 
standards using the portable analyzer for a period of six (6) months, 
VIWAPA shall reduce the initial frequency of monitoring to biweekly 
(once every two (2) weeks). VIWAPA shall further reduce the subsequent 
frequency of monitoring to monthly after a demonstration of continual 
compliance of the emission standards using the portable analyzer for a 
period of six (6) months. VIWAPA shall not reduce the frequency of the 
periodic monitoring using the portable analyzer any further than once 
every month. VIWAPA shall revert back to the prior frequency of 
periodic monitoring if two (2) consecutive measurements with the 
portable analyzer indicate noncompliance with the emission limit.
    During periods that the PSD affected gas turbines operate less than 
five (5) hours per week, the exemption allows VIWAPA to forgo the 
required portable analyzer monitoring for that weekly period. Where 
VIWAPA has not operated a unit for a two-week period and such unit 
begins operation greater than five (5) hours per week, VIWAPA shall 
conduct the monitoring with the portable analyzer within two (2) days 
of the day in which the unit had been operated for more than five (5) 
hours that week. If VIWAPA does not operate a unit or operates a unit 
for less than five (5) hours per week, VIWAPA shall monitor such a unit 
at a lower frequency of no less than once every two (2) months. A unit 
shall be considered to be operating when fuel is being combusted 
regardless of the capacity at which it is burning the fuel.
    VIWAPA shall submit copies of all data relating to the periodic 
sampling and shall be submitted with VIWAPA's quarterly reports. During 
periods when stack tests are performed, VIWAPA shall use the portable 
flue gas emission analyzer for correlation purposes to verify accuracy. 
VIWAPA shall submit for EPA approval its selection of the portable flue 
gas analyzer it proposes to use for the periodic sampling. (Examples of 
such portable devices include but are not limited to Lancom III by Land 
Instrument, Enerac 3000 by Energy Efficiency Systems and PEM 9002 by 
Teledyne Analytical Instruments.) This list of examples is not an EPA 
pre-endorsement of any of these devices.
    All exceedances of the NOX emission limits measured by 
the portable analyzer for the sampling period determined through the 
EPA approved sampling protocol shall be considered violations of the 
emissions standards.

Improving the Alternative Monitoring System (AMS)

    8. VIWAPA shall monitor the water injection rates and the 
established compliance parameters.
    9. VIWAPA shall ensure that the AMS be completely automated and 
that mechanisms or safeguards are implemented to ensure that the raw 
data cannot be altered.
    10. VIWAPA shall design a data logging system to function and 
continue to function at all times, including but not limited to 
instances when the water injection system is switched from automatic 
operation to manual operation, when water injection pumps are switched, 
when the water injection system trips and when sensors malfunction.
    11. VIWAPA shall ensure that the AMS record the specific hours of 
operation and operating load of each turbine.
    12. VIWAPA shall keep a log that indicates any instances in which a 
compliance parameter is exceeded, the reasons for the exceedance, and 
the corrective action(s) taken (Compliance Parameter Log).
    13. VIWAPA shall keep logs of all parameters manually which include 
the reasons for system failure and corrective measures when the AMS 
system is unable to log data.
    14. VIWAPA shall test alarms weekly to ensure proper operation.
    15. VIWAPA shall ensure that the AMS monitoring system maintains a 
data availability of 95% per quarter over all of the hours of the 
quarter. VIWAPA shall ensure that the AMS monitoring system, in 
conjunction with the manual logging during any period where the AMS is 
not in operation, maintain a data availability of 98% per quarter over 
all the hours of the quarter.

Water Injection System

    16. Within sixty (60) days of the approval, VIWAPA shall complete a 
third-party system-wide evaluation of the water injection system of 
each PSD permitted turbine. VIWAPA shall perform the evaluation to 
identify and to determine the causes of any system failure, to 
determine the integrity of the water injection system, to determine why 
operators continually switch water injection pumps and why some pump 
switches result in excess emissions being measured at the CEMS and not 
the AMS.
    17. Within sixty (60) days of completion of the third-party system-
wide evaluation, VIWAPA shall implement a capital improvement program 
to replace all damaged and/or deteriorated equipment relating to the 
water injection systems for all PSD permitted turbines and to correct 
any equipment, hardware, software, or operational deficiencies revealed 
during the audits.
    18. Within sixty (60) days of completion of the third-party system-
wide evaluation, VIWAPA shall ensure that water flow monitors shall be 
located as close as possible to the turbine injection points to 
minimize false readings caused by leaks downstream, clogged filters, or 
unforeseen problems.
    19. Within sixty (60) days of the approval, VIWAPA shall install, 
operate and maintain a feed water pretreatment system to remove 
minerals that lead to scaling and clogging of the water injection 
nozzles.
    20. Within one hundred twenty (120) days of the approval, VIWAPA 
shall develop and implement a preventative operation and maintenance 
plan (including standard operation procedures) to ensure the proper and 
continual operation of the water injection system. Such a plan shall 
include, but is not limited to schedules for periodic pump maintenance, 
replacing filters, identifying and repairing leaks (temporary and 
permanent), and schedules and procedures for calibrations of water and 
fuel monitors. VIWAPA shall ensure that good air pollution control 
practices are utilized at all times during the operation of the water 
injection system.
    21. Within one hundred twenty (120) days of the approval, VIWAPA 
shall implement a spare parts inventory program at each facility. The 
spare parts inventory program shall contain an inventory of various 
replacement parts for routine maintenance. VIWAPA shall maintain lists/
logs of the average frequency at which hardware

[[Page 74893]]

components are required to be replaced and the dates of replacement of 
such components. VIWAPA shall assess the minimum quantity of each 
replacement component that may be maintained based upon evaluation, at 
the very least, of the lead and the delivery time for procurement and 
the frequency at which each a component is required to be replaced in 
the equipment. VIWAPA shall design the spare parts inventory to ensure 
minimum water injection system downtime in the event of a water 
injection system failure.
    22. VIWAPA shall ensure that at least one technical person or 
engineer be available on site at its St. Thomas and St. Croix 
facilities at all times who is trained and experienced in operating and 
maintaining the water injection system.

Visible Emission Readings

    23. VIWAPA shall have a minimum of three (3) EPA Method 9 certified 
visible emission readers on its staff at its St. Thomas facility and 
three (3) visible emission readers on its staff at its St. Croix 
facility. VIWAPA shall ensure that two (2) certified visible emission 
readers be on-site to conduct two (2) consecutive six-minute Method 9 
visible emissions readings in accordance with EPA recognized 
interpretations of Method 9 for each operating turbine, once during 
each day of operation. If these observations demonstrate an exceedance 
of the opacity limits, VIWAPA shall continue to conduct visible 
emissions observations until the visible emissions readings document 
that opacity is below the applicable limits.
    VIWAPA shall be required to increase the frequency of visible 
emissions readings to once per eight (8) hour operating shift, during 
daylight operation, for a period of thirty (30) operating days on a 
unit where there is a total of thirty (30) minutes or more of visible 
emissions readings indicating noncompliance with the PSD limit within a 
twenty four (24) hour period. During this thirty (30) operating day 
period, if there are a total of eighteen (18) minutes or more of 
visible emissions readings indicating noncompliance with the PSD limit 
within a twenty four (24) hour period, the thirty (30) operating day 
period shall be restarted from that day. Readings taken between each 
shift must be separated by a minimum of two (2) hours.
    Any periods of exceedance shall be considered violations of the 
opacity limitations in the PSD permit. VIWAPA shall document any 
periods where it does not conduct the required visible emissions 
readings, explaining the reason(s) that it did not perform these 
readings. Any visible emissions readings, conducted by EPA and/or 
VIDPNR that indicate noncompliance with the PSD limits for the 
durations specified above, shall also result in VIWAPA's increasing or 
extending the frequency of required visible emissions readings.

Improving the Physical Condition of the Turbines and Associated Stacks

    24. VIWAPA shall take all steps necessary to improve the physical 
condition of the gas turbines and associated stacks in order to 
eliminate excessive vibration, stack flexing, improper alignment and 
any other such problem that adversely affects proper operation of the 
CEMS. Within sixty (60) days of this approval, VIWAPA shall provide EPA 
with a plan, including a schedule for repairs and improvements, to 
ensure that VIWAPA will be able to install and properly operate new 
CEMS upon termination of the five (5) year exemption. VIWAPA shall 
implement the submitted plan and schedule after review and approval by 
EPA.

Reporting and Recordkeeping

    25. VIWAPA shall keep on site records of activities conducted 
pursuant to this exemption shall be kept on site for seven (7) years 
and shall make these records available to EPA upon request.
    26. VIWAPA shall report to EPA any significant or anticipated 
changes in circumstances as prescribed above at the facility as soon as 
practicable but no later than 15 days after knowledge of such change. 
Significant changes in circumstances include, but are not limited to, 
changes at the facility or in the NAAQS attainment area, changes which 
could impact upon the maintenance of the NAAQS, changes in financial 
status, and changes in ownership (including privatization--in whole or 
in part), which could have an impact upon the facilities' finances or 
ability to hire and retain technical and engineering personnel.
    27. Within sixty (60) days of the completion of stack testing, 
VIWAPA shall submit stack test reports to EPA covering all tests on all 
units at its St. Thomas and St. Croix facilities. VIWAPA may, at its 
option, submit a report for each unit or a single consolidated report, 
as long as all information for all units is clearly identified and 
submitted on time. For each test on each unit, the test report(s) shall 
include:
     Certified true copies of all raw data collected from each 
part of each test for each parameter measured or observed during and 
associated with each test, including, for example, all raw data from 
the emission tests (both field and laboratory), fuel bound nitrogen 
measurements, all AMS parameter measurements, load measurements, all 
quality control and/or quality assurance measurements associated with 
all of the proceeding, etc.
     Summary sheets, showing, for each test, the values 
determined for each measured pollutant along with the applicable 
compliance limit,
     Results of all calculations including example calculations 
for each step,
     All compliance parameters proposed for each operating 
condition or set of conditions, along with tabulated and/or graphical 
evidence confirming that those parameter settings would ensure 
compliance with the emission limitations.
    28. Within sixty (60) days of completion of the third-party system-
wide evaluation of the water injection systems, VIWAPA shall submit a 
report that includes a timetable to correct all problems identified as 
well as the preventative and operations maintenance plan to EPA for 
review, revision and approval.
    29. Within one hundred twenty (120) days of the approval, VIWAPA 
shall submit documentation to demonstrate that data logging for the AMS 
is completely automated and that raw data cannot be altered.
    30. VIWAPA shall submit Quarterly reports to EPA covering the 
activities performed in accordance with the monitoring requirements for 
each calendar quarter and shall postmark these reports by the thirtieth 
(30th) day following the end of each calendar quarter. VIWAPA shall 
submit such a report for the first quarter, even if it does not include 
a full three month period.
    31. VIWAPA shall include in Quarterly reports the following 
information about activities which occurred during the reporting 
period, for each unit: The AMS, periodic monitoring, visible emissions 
observations, fuel-bound nitrogen and sulfur content monitoring, and 
improvements to the physical condition of the gas turbines and 
associated stacks in accordance with paragraph 24.
     Alternative Monitoring System:
    --Copies of the AMS Compliance Parameter Log documenting each 
measured exceedance of the emission standard, indicating, at least the 
start and stop times for each exceedance, the hourly average water to 
fuel ratio during the exceedance period, the established water to fuel 
compliance ratio for the

[[Page 74894]]

period, an explanation of the possible causes of the exceedance, with 
the number of hours attributed to each cause, the total operating hours 
for the unit during the quarter, and the corrective action taken.
    --Copies of the Incident Log, and the Manual Log for each unit, 
indicating each time that the AMS became inoperable or performed 
improperly or was out of service for any reason, including the start 
and stop time of the outage, the reason determined for the outage, and 
the corrective action taken.
    --Summary Reports for all water-to-fuel exceedances and AMS 
downtimes for the unit during the quarter, including the total number 
of exceedance hours and downtime hours, the total number of operating 
hours in the quarter, and the percent of total operating hours for 
which there were exceedances or downtimes. A listing of the minimum 
information required in the summary sheet in the recommended format is 
attached as Attachment 1.
     Periodic monitoring, visible emissions observations and 
fuel bound nitrogen and sulfur content monitoring:
    --Copies of all data for each monitoring type (periodic, etc.)
    --Supplemental information related to exceedances and missed 
samples or data for each monitoring type, including a listing of each 
exceedance or missed sample, documentation of the date, time, duration, 
cause, and corrective action for each.
    --Summary sheet for each testing and/or monitoring activity. A 
listing of the minimum information required in the summary sheet in the 
recommended format is attached as Attachment 2.
     EPA reserves the right, following review of any Quarterly 
Report, to require changes in subsequent reporting to facilitate 
facility response and EPA reviews.
    32. In order for EPA to ensure the acceptability of the format of 
the Quarterly Summary Reports and accompanying detailed excess emission 
reports, VIWAPA shall submit copies of draft reports to EPA review and 
approval within one hundred twenty (120) days of the approval of the 
Petition to: Air and Water QA Team, Monitoring and Assessment Branch, 
US EPA Region 2, 2890 Woodbridge Ave. Edison, New Jersey 08837.

Unit 23

    33. VIWAPA shall install and performance test the CEMS required by 
the PSD permit for Unit 23 in accordance with its PSD permit 
conditions, within one hundred eighty (180) days of the effective date 
of the approval. Failure to do so, within one hundred eighty (180) days 
of the effective date of this approval, will subject VIWAPA to 
penalties for non-compliance with its PSD permit.
    34. VIWAPA shall be allowed a period, of up to one hundred eighty 
(180) days after all of the CEMS are performance tested but no greater 
than one (1) year of the effective date of the approval, to address any 
training, operation and maintenance issues as they relate to meeting 
the PSD permit CEMS performance conditions. During this period of time, 
VIWAPA shall not be penalized for failing to comply with the PSD 
performance conditions. After this period, VIWAPA shall be subject to 
penalties for any violations of its PSD permit CEMS conditions.
    35. VIWAPA shall submit all reports relating to the CEMS for Unit 
23 in accordance with the requirements of its PSD permit.

Future Installation of New CEMS

    36. Within one hundred twenty (120) days of the approval, VIWAPA 
shall submit a detailed plan for securing funding to purchase and 
install new CEMS at the PSD permitted units. Such a plan shall include 
a feasibility option for installation of time-share CEMS which could 
result in a significant reduction in the number of CEMS required and 
significantly reduce future CEMS purchase, installation and maintenance 
costs.
    37. VIWAPA shall implement the submitted plan to ensure funding, 
purchase, installation and operation of CEMS at all of the PSD 
permitted units by no later than the termination date of this 
exemption.

Enforcement

    38. In accordance with the CAA, penalties for violations or 
multiple violations of operating, emission, monitoring, and 
recordkeeping requirements may be assessed for periods such as when the 
AMS system does not automatically log or logs improperly, when the 
integrity of the data is not ensured, when the water to fuel injection 
rates are below the established minimum water-to-fuel ratio as 
monitored by the AMS; when the permitted turbines are operating without 
water injection; when records are not maintained; and/or when required 
changes to reporting are not made.

VIII. Statutory and Executive Order Review

A. Executive Order 12866, Regulatory Planning and Review

    This action is not a ``significant regulatory action'' under the 
terms of Executive Order (EO) 12866 (58 FR 51735, October 4, 1993) and 
is therefore not subject to review under the EO. It involves a 
temporary exemption from existing regulatory requirements for two 
sources, requested by a Petition filed by the Governor of the Virgin 
Islands on behalf of the regulated sources.

B. Paperwork Reduction Act

    Under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., OMB must 
approve all ``collections of information'' by EPA. The Act defines 
``collection of information'' as a requirement for ``answers to * * * 
identical reporting or record keeping requirements imposed on ten or 
more persons * * * '' 44 U.S.C. 3502(3)(A). Because the proposed 
exemption only applies to one company, the Paperwork Reduction Act does 
not apply.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to conduct a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements under the Administrative 
Procedure Act or any other statute unless the agency certifies that the 
rule will not have a significant economic impact on a substantial 
number of small entities. Small entities include small businesses, 
small organizations, and small governmental jurisdictions.
    For purposes of assessing the impacts of today's 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; and (3) a small organization that is 
any not-for-profit enterprise which is independently owned and operated 
and is not dominant in its field.
    After considering the economic impact of today's proposed rule on 
small entities, I certify that this action will not have a significant 
impact on a substantial number of small entities. The exemption applies 
to only two source and only postpones compliance with PSD permit 
conditions for a five (5) year period. We continue to be interested in 
the potential impacts of the proposed rule on small entities and 
welcome comments on issues related to such impacts.

D. Unfunded Mandates Reform Act

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), signed

[[Page 74895]]

into law on March 22, 1995, EPA must prepare a budgetary impact 
statement to accompany any proposed or final rule that includes a 
Federal mandate that may result in estimated costs to State, local, or 
tribal governments in the aggregate; or to the private sector, of $100 
million or more. Under section 205, EPA must select the most cost-
effective and least burdensome alternative that achieves the objectives 
of the rule and is consistent with statutory requirements. Section 203 
requires EPA to establish a plan for informing and advising any small 
governments that may be significantly or uniquely impacted by the rule.
    EPA has determined that the approval action proposed does not 
include a Federal mandate that may result in estimated costs of $100 
million or more to either State, local, or tribal governments in the 
aggregate, or to the private sector. This Federal action proposes to 
approve a waiver under Federal law, and imposes no new requirements. 
Accordingly, no additional costs to State, local, or tribal 
governments, or to the private sector, result from this action.

E. Executive Order 13132, Federalism

    Federalism (64 FR 43255, August 10, 1999) revokes and replaces 
Executive Orders 12612 (Federalism) and 12875 (Enhancing the 
Intergovernmental Partnership). Executive Order 13132 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 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 proposed rule does not have federalism implications.
    It 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, because it merely 
propose approval of a waiver from a Federal standard, and does not 
alter the relationship or the distribution of power and 
responsibilities established in the CAA. Thus, the requirements of 
Section 6 of the Executive Order do not apply to this rule.

F. Executive Order 13175, 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 proposed rule does not 
have tribal implications, as specified in Executive Order 13175.
    Today's proposed rule does not significantly or uniquely affect the 
communities of Indian tribal governments. This action does not involve 
or impose any requirements that affect Indian Tribes. Thus, Executive 
Order 13175 does not apply to this rule.

G. Executive Order 13045, Protection of Children From Environmental 
Health Risks and Safety Risks

    Protection of Children from Environmental Health Risks and Safety 
Risks (62 FR 19885, April 23, 1997), applies to any rule that: (1) Is 
determined to be ``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 rule is not subject to Executive Order 13045 because it does 
not involve decisions intended to mitigate environmental health or 
safety risks.

H. Executive Order 13211, Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This rule is not subject to Executive Order 13211, ``Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use'' (66 FR 28355, May 22, 2001) because it is not a 
significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (``NTTAA''), Public Law 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 proposed rulemaking involves technical standards. EPA proposes 
the use of the following ASTM Test Methods: D2597-994, D6366-99, D4629-
02 or D5762-02 for measuring the nitrogen content of fuel. They are 
available from ASTM International and will help insure compliance with 
the conditions of this action. EPA welcomes comments on this aspect of 
the proposed rulemaking and, specifically, invites the public to 
identify potentially-applicable voluntary consensus standards and to 
explain why such standards should be used in this regulation.

List of Subjects in 40 CFR Part 69

    Environmental protection, Air pollution control.

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

    Dated: December 7, 2006.
Stephen L. Johnson,
Administrator.
[FR Doc. E6-21198 Filed 12-12-06; 8:45 am]

BILLING CODE 6560-50-P