Document ID: EPA-R08-OAR-2018-0015-0001
Agency: epa
Document Type: Proposed Rule
Title: Air Quality State Implementation Plans; Approvals and Promulgations: Colorado; Regional Haze State Implementation Plan
Posted Date: 2018-04-26T04:00Z

[Federal Register Volume 83, Number 81 (Thursday, April 26, 2018)]
[Proposed Rules]
[Pages 18243-18248]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-08622]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R08-OAR-2018-0015; FRL-9976-45--Region 8]

Approval and Promulgation of Air Quality Implementation Plans; 
Colorado; Regional Haze State Implementation Plan

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to 
approve a State Implementation Plan (SIP) revision submitted by the 
State of Colorado on May 26, 2017, addressing regional haze. The EPA is 
proposing to approve source-specific revisions to the nitrogen oxides 
(NOX) best available retrofit technology (BART) 
determination for Craig Station Unit 1. This unit is owned in part and 
operated by Tri-State Generation & Transmission Association, Inc. (Tri-
State). We are also proposing to approve revisions to the 
NOX reasonable progress determination for Tri-State's Nucla 
Station. The EPA is taking this action pursuant to section 110 of the 
Clean Air Act (CAA).

DATES: Comments: Written comments must be received on or before May 29, 
2018.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R08-
OAR-2018-0015, to the Federal Rulemaking Portal: https://www.regulations.gov. Follow the online instructions for submitting 
comments. Once submitted, comments cannot be edited or removed from 
www.regulations.gov. The EPA may publish any comment received to its 
public docket. Do not submit electronically any information you 
consider to be Confidential Business Information (CBI) or other 
information whose disclosure is restricted by statute. Multimedia 
submissions (audio, video, etc.) must be accompanied by a written 
comment. The written comment is considered the official comment and 
should include discussion of all points you wish to make. The EPA will 
generally not consider comments or comment contents located outside of 
the primary submission (i.e., on the web, cloud, or other file sharing 
system). For additional submission methods, the full EPA public comment 
policy, information about CBI or multimedia submissions, and general 
guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.
    Docket: All documents in the docket are listed in the 
www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hard copy. 
Publicly available docket materials are available either electronically 
in www.regulations.gov or in hard copy at the Air Program, 
Environmental Protection Agency (EPA), Region 8, 1595 Wynkoop Street, 
Denver, Colorado 80202-1129. The EPA requests that if at all possible, 
you contact the individual listed in the FOR FURTHER INFORMATION 
CONTACT section to view the hard copy of the docket. You may view the 
hard copy of the docket Monday through Friday, 8:00 a.m. to 4:00 p.m., 
excluding federal holidays.

FOR FURTHER INFORMATION CONTACT: Jaslyn Dobrahner, Air Program, EPA, 
Region 8, Mailcode 8P-AR, 1595 Wynkoop Street, Denver, Colorado, 80202-
1129, (303) 312-6252, [email protected].

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

Table of Contents

I. What action is the EPA taking?
II. Background
    A. Requirements of the Clean Air Act and the EPA's Regional Haze 
Rule
    B. Best Available Retrofit Technology (BART)
    C. Reasonable Progress Requirements
    D. Consultation With Federal Land Managers (FLMs)
    E. Regulatory and Legal History of the 2012 Colorado SIP
III. Craig Unit 1--NOX BART
    A. Background
    B. May 26, 2017 Submittal
    C. The EPA's Evaluation of Craig Unit 1 Amendments
IV. Nucla--NOX Reasonable Progress
    A. Background
    B. May 26, 2017 Submittal
    C. The EPA's Evaluation of Nucla Amendments
V. Coordination With FLMs
VI. The EPA's Proposed Action
    VII. Incorporation by Reference
VIII. Statutory and Executive Order Reviews

I. What action is the EPA taking?

    On December 31, 2012, the EPA approved a regional haze SIP revision 
submitted by the State of Colorado on May 25, 2011. The 2011 SIP 
revision included NOX BART emission limits for Craig Station 
Units 1 and 2 near Craig, Colorado, and a NOX reasonable 
progress emission limit for the Nucla Station located in Montrose 
County.\1\ The State of Colorado submitted proposed revisions to the 
2011 SIP submittal on May 26, 2017, that modify the NOX BART 
determination for Craig Unit 1 and the NOX reasonable 
progress determination for Nucla. The EPA is now proposing to approve 
those revisions. Specifically, the EPA is proposing to approve the 
State's revisions to the Craig Unit 1 NOX BART determination 
that would require Craig Unit 1 to meet an annual NOX 
emission limit of 4,065 tons per year (tpy) by December 31, 2019. The 
SIP revision would also require the unit to either (1) convert to 
natural gas by August 31, 2023, and if converting to natural gas,

[[Page 18244]]

comply with a NOX emission limit of 0.07 lb/MMBtu (30-day 
rolling average) beginning August 31, 2021, or (2) shut down by 
December 31, 2025. The EPA is also proposing to approve the State's 
revisions to the Nucla NOX reasonable progress determination 
that would require the source to meet an annual NOX emission 
limit of 952 tpy by January 1, 2020, and shut down on or before 
December 31, 2022.
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    \1\ 77 FR 76871 (December 31, 2012).
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II. Background

A. Requirements of the Clean Air Act and the EPA's Regional Haze Rule

    In section 169A of the CAA, added by the 1977 Amendments to the 
Act, Congress created a program for protecting visibility in the 
nation's national parks and wilderness areas. This section establishes 
``as a national goal the prevention of any future, and the remedying of 
any existing, impairment of visibility in mandatory Class I Federal 
areas which impairment results from manmade air pollution.'' \2\ On 
December 2, 1980, the EPA promulgated regulations to address visibility 
impairment in Class I areas that is ``reasonably attributable'' to a 
single source or small group of sources.\3\ These regulations 
represented the first phase in addressing visibility impairment. The 
EPA deferred action on regional haze, which emanates from a variety of 
sources, until monitoring, modeling and scientific knowledge about the 
relationships between pollutants and visibility impairment were 
improved.\4\
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    \2\ 42 U.S.C. 7491(a). Areas designated as mandatory Class I 
Federal areas consist of national parks exceeding 6000 acres, 
wilderness areas and national memorial parks exceeding 5000 acres, 
and all international parks that were in existence on August 7, 
1977. 42 U.S.C. 7472(a). In accordance with section 169A of the CAA, 
EPA, in consultation with the Department of Interior, promulgated a 
list of 156 areas where visibility is identified as an important 
value. 44 FR 69122 (November 30, 1979). The extent of a mandatory 
Class I area includes subsequent changes in boundaries, such as park 
expansions. 42 U.S.C. 7472(a). Although states and tribes may 
designate as Class I additional areas which they consider to have 
visibility as an important value, the requirements of the visibility 
program set forth in section 169A of the CAA apply only to 
``mandatory Class I Federal areas.'' Each mandatory Class I Federal 
area is the responsibility of a ``Federal Land Manager.'' 42 U.S.C. 
7602(i). When we use the term ``Class I area'' in this section, we 
mean a ``mandatory Class I Federal area.''
    \3\ 45 FR 80084, 80084 (December 2, 1980).
    \4\ Regional haze means visibility impairment that is caused by 
the emission of air pollutants from numerous anthropogenic sources 
located over a wide geographic area. Such sources include, but are 
not limited to, major and minor stationary sources, mobile sources, 
and area sources. 40 CFR 51.301.
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    Congress added section 169B to the CAA in 1990 to address regional 
haze issues. The EPA promulgated a rule to address regional haze on 
July 1, 1999.\5\ The Regional Haze Rule (RHR) revised the existing 
visibility regulations to integrate provisions addressing regional haze 
and established a comprehensive visibility protection program for Class 
I areas. The requirements for regional haze, found at 40 CFR 51.308 and 
51.309, are included in the EPA's visibility protection regulations at 
40 CFR 51.300-51.309. The EPA revised the RHR on January 10, 2017.\6\
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    \5\ 64 FR 35714, 35714 (July 1, 1999) (codified at 40 CFR part 
51, subpart P).
    \6\ 82 FR 3078 (January 10, 2017).
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    The CAA requires each state to develop a SIP to meet various air 
quality requirements, including protection of visibility.\7\ Regional 
haze SIPs must assure reasonable progress toward the national goal of 
achieving natural visibility conditions in Class I areas. A state must 
submit its SIP and SIP revisions to the EPA for approval. Once 
approved, a SIP is enforceable by the EPA and citizens under the CAA; 
that is, the SIP is federally enforceable.
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    \7\ CAA sections 110(a), 169A, and 169B, 42 U.S.C. 7410(a), 
7491, and 7492(a).
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B. Best Available Retrofit Technology (BART)

    Section 169A of the CAA directs the EPA to require states to 
evaluate the use of retrofit controls at certain larger, often 
uncontrolled, older stationary sources in order to address visibility 
impacts from these sources. Specifically, section 169A(b)(2)(A) 
requires states to include in their SIPs such measures as may be 
necessary to make reasonable progress toward the natural visibility 
goal, including a requirement that certain categories of existing major 
stationary sources built between 1962 and 1977 procure, install, and 
operate the ``Best Available Retrofit Technology'' as determined by the 
states. Under the RHR, states are directed to conduct BART 
determinations for such ``BART-eligible'' sources that may reasonably 
be anticipated to cause or contribute to any visibility impairment in a 
Class I area.
    On July 6, 2005, the EPA published the Guidelines for BART 
Determinations under the Regional Haze Rule (the ``BART Guidelines'') 
to assist states in determining which sources should be subject to the 
BART requirements and in setting appropriate emission limits for each 
covered source.\8\ The process of establishing BART emission 
limitations follows three steps: first, identify the sources that meet 
the definition of ``BART-eligible source'' set forth in 40 CFR 51.301; 
\9\ second, determine which of these sources ``emits any air pollutant 
which may reasonably be anticipated to cause or contribute to any 
impairment of visibility in any such area'' (a source which fits this 
description is ``subject to BART''); and third, for each source subject 
to BART, identify the best available type and level of control for 
reducing emissions. Section 169A(g)(7) of the CAA requires that states 
consider five factors in making BART determinations: (1) The costs of 
compliance; (2) the energy and non-air quality environmental impacts of 
compliance; (3) any existing pollution control technology in use at the 
source; (4) the remaining useful life of the source; and (5) the degree 
of improvement in visibility which may reasonably be anticipated to 
result from the use of such technology. States must address all 
visibility-impairing pollutants emitted by a source in the BART 
determination process. The most significant visibility-impairing 
pollutants are sulfur dioxide (SO2), NOX, and 
particulate matter (PM).
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    \8\ 70 FR 39104; 40 CFR part 51, appendix Y.
    \9\ BART-eligible sources are those sources that have the 
potential to emit 250 tons or more of a visibility-impairing air 
pollutant, were not in operation before August 7, 1962, but were in 
existence on August 7, 1977, and whose operations fall within one or 
more of 26 specifically listed source categories. 40 CFR 51.301.
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    A SIP addressing regional haze must include source-specific BART 
emission limits and compliance schedules for each source subject to 
BART. In lieu of requiring source-specific BART controls, states have 
the flexibility to adopt alternative measures, as long as the 
alternative provides greater reasonable progress towards natural 
visibility conditions than BART (i.e., the alternative must be ``better 
than BART'').\10\ Once a state has made a BART determination, the BART 
controls must be installed and operated as expeditiously as 
practicable, but no later than 5 years after the date of the EPA's 
approval of the final SIP.\11\ In addition to what is required by the 
RHR, general SIP requirements mandate that the SIP include all 
regulatory requirements related to monitoring, recordkeeping, and 
reporting for the BART emission limitations.\12\
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    \10\ 40 CFR 51.308(e)(2) and (3).
    \11\ CAA section 169A(g)(4), 42 U.S.C. 7491(g)(4); 40 CFR 
51.308(e)(1)(iv).
    \12\ CAA section 110(a), 42 U.S.C. 7410(a); 40 CFR part 51, 
subpart K.
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C. Reasonable Progress Requirements

    In addition to BART requirements, each regional haze SIP must 
contain measures as necessary to make reasonable progress towards the 
national visibility goal. As part of determining what measures are 
necessary to make reasonable progress,

[[Page 18245]]

the SIP must first identify anthropogenic sources of visibility 
impairment that are to be considered in developing the long-term 
strategy for addressing visibility impairment.\13\ States must then 
consider the four statutory reasonable progress factors in selecting 
control measures for inclusion in the long-term strategy--the costs of 
compliance, the time necessary for compliance, the energy and non-air 
quality environmental impacts of compliance, and the remaining useful 
life of potentially affected sources.\14\ Finally, the SIP must 
establish reasonable progress goals (RPGs) for each Class I area within 
the State for the plan implementation period (or ``planning period''), 
based on the measures included in the long-term strategy.\15\ If an RPG 
provides for a slower rate of improvement in visibility than the rate 
needed to attain the national goal by 2064, the SIP must demonstrate, 
based on the four reasonable progress factors, why the rate to attain 
the national goal by 2064 is not reasonable and the RPG is 
reasonable.\16\
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    \13\ 40 CFR 51.308(d)(3)(iv).
    \14\ CAA section 169A(g)(1), 42 U.S.C. 7491(g)(1); 40 CFR 
51.308(d)(1)(i)(A).
    \15\ 40 CFR 51.308(d), (f).
    \16\ 40 CFR 51.308(d)(1)(ii).
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D. Consultation With Federal Land Managers (FLMs)

    The RHR requires that a state consult with FLMs before adopting and 
submitting a required SIP or SIP revision.\17\ States must provide FLMs 
an opportunity for consultation, in person and at least 60 days before 
holding any public hearing on the SIP. This consultation must include 
the opportunity for the FLMs to discuss their assessment of impairment 
of visibility in any Class I area and to offer recommendations on the 
development of the RPGs and on the development and implementation of 
strategies to address visibility impairment. Further, a state must 
include in its SIP a description of how it addressed any comments 
provided by the FLMs. Finally, a SIP must provide procedures for 
continuing consultation between the state and FLMs regarding the 
state's visibility protection program, including development and review 
of SIP revisions and 5-year progress reports, and on the implementation 
of other programs having the potential to contribute to impairment of 
visibility in Class I areas.
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    \17\ 40 CFR 51.308(i).
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E. Regulatory and Legal History of the 2012 Colorado SIP

    On December 31, 2012, the EPA approved a regional haze SIP revision 
submitted by the State of Colorado on May 25, 2011. On February 25, 
2013, the National Parks Conservation Association (NPCA) and Wild Earth 
Guardians (Guardians) filed petitions for review in the U.S. Court of 
Appeals for the Tenth Circuit of the EPA's final approval of the 
Colorado regional haze SIP.\18\ Among other things, Guardians and NPCA 
challenged the NOX BART limit for Craig Unit 1. Tri-State 
and the State of Colorado joined the litigation as intervenors. After 
the court consolidated the cases for review, and after several months 
of court-supervised mediation, the parties reached a settlement under 
which Craig Unit 1 would be subject to a 0.07 lb/MMBtu NOX 
limit, consistent with the installation of selective catalytic 
reduction (SCR) controls, by August 31, 2021.\19\ The settlement 
further required that the EPA ask the Tenth Circuit to vacate the 
previous approval of the Colorado SIP revision relating to Craig Unit 1 
and remand the rule to the agency for further action. The court granted 
the EPA's request on December 22, 2014, and signed an order ending the 
litigation on August 15, 2015.
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    \18\ WildEarth Guardians v. EPA, No. 13-9520 (10th Cir.) and 
National Parks Conservation Association v. EPA, No. 13-9525 (10th 
Cir.).
    \19\ 79 FR 47636 (August 14, 2014).
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    In accordance with the terms of the 2014 settlement, Colorado 
submitted a SIP revision to the EPA in 2015 to revise the Craig Unit 1 
NOX BART determination, emission limit, and associated 
compliance deadline. Specifically, Colorado determined that 
NOX BART for Craig Unit 1 was an emission limit of 0.07 lb/
MMBtu, which was based on the capabilities of SCR, and established an 
associated compliance date of August 31, 2021.
    In 2017, Colorado submitted a regional haze SIP revision to the EPA 
reassessing the NOX limit for the Craig Unit 1. The 
revisions were developed after discussions in 2016 between Tri-State, 
Guardians, NPCA, the State of Colorado, and the EPA, and require one of 
two possible NOX BART compliance paths for Craig Unit 1 to 
either (1) shut down by December 31, 2025, or (2) convert to natural-
gas firing by August 31, 2023. If Craig Unit 1 is converted to natural-
gas firing, the NOX emission limit will be 0.07 lb/MMBtu 
after August 31, 2021 (30-day rolling average). If Craig Unit 1 is shut 
down, the NOX emission limit will be 0.28 lb/MMBtu (30-day 
rolling average) until December 31, 2025. Colorado withdrew the 2015 
SIP revision when it submitted the 2017 SIP revision that is the 
subject of this proposed action.

III. Craig Unit 1--NOX BART

A. Background

    The 2011 regional haze SIP for Colorado established a 
NOX BART emission limit for Craig Units 1 and 2. The Craig 
Station is located in Moffat County, approximately 2.5 miles southwest 
of the town of Craig. This facility is a coal-fired power plant with a 
total net electric generating capacity of 1264 megawatts (MW), 
consisting of three units. Units 1 and 2, which are subject to BART, 
are dry-bottom pulverized coal-fired boilers, each rated at a net 
capacity of 428 MW.
    In the 2011 submittal, Colorado determined that selective non-
catalytic reduction (SNCR) was BART for both Unit 1 and Unit 2, based 
on the cost-effectiveness and visibility improvement associated with 
this level of control. Colorado determined that SCR, a more stringent 
control technology, was not BART because its costs were too high. 
Colorado also determined that SNCR could achieve an emission limit of 
0.27 lb/MMBtu (30-day rolling average) at both Unit 1 and Unit 2. 
Nevertheless, as a BART alternative, Colorado ultimately adopted a more 
stringent emission limit for Unit 2 (0.08 lb/MMBtu, 30-day rolling 
average, based on SCR) and a slightly less stringent limit for Unit 1 
(0.28 lb/MMBtu, 30-day rolling average, based on SNCR). The EPA 
approved Colorado's BART alternative and NOX BART emission 
limits into the SIP on December 31, 2012.\20\
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    \20\ 77 FR 76871 (December 31, 2012).
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B. May 26, 2017 Submittal

    On May 26, 2017, Colorado submitted a SIP revision containing 
amendments to the Colorado Code of Regulations, Regulation Number 3, 
Stationary Source Permitting and Air Pollutant Emission Notice 
Requirements, Part F, Regional Haze Limits--Best Available Retrofit 
Technology (BART) and Reasonable Progress (RP), Section VI, Regional 
Haze Determinations. In assessing BART for Craig Unit 1, Colorado 
determined that, under either a 20- or 30-year remaining useful life, 
NOX BART would be an emission limit of 0.07 lb/MMBtu based 
on the installation of SCR.\21\ Colorado

[[Page 18246]]

then reassessed NOX BART for Craig Unit 1 under the two 
compliance paths associated with the 2016 settlement discussions: A 
shutdown in 2025 or a conversion to natural gas in 2023.\22\ After 
completing this reassessment, Colorado established the following 
amendments:
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    \21\ This limit, consistent with the 2014 settlement, was 
contained in the 2015 SIP submission. As noted previously, the State 
withdrew that submission when it submitted the 2017 SIP revision, 
but the State's justification for the 0.07 lb/MMBtu NOX 
BART limit is retained in the 2017 SIP.
    \22\ Colorado used the term ``reassessment,'' and we interpret 
the term to mean that the state reassessed its previous BART 
determination under the differing future factual scenarios to see 
whether those facts were outcome determinative.
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     Craig Unit 1 will either (1) close on or before December 
31, 2025; or (2) cease burning coal no later than August 31, 2021, with 
the option to convert Unit 1 to natural-gas firing by August 31, 2023;
     In the case of a conversion to natural-gas firing, a 30-
day rolling average NOX emission limit of 0.07 lb/MMBtu (30-
day rolling average) will be effective after August 31, 2021;
     The owner/operator of Craig Unit 1 will notify the State 
in writing on or before February 28, 2021, whether Unit 1 will cease 
operation or convert to natural gas;
     For both scenarios, Craig Unit 1 will be subject to an 
interim NOX emission limit of 0.28 lb/MMBtu (30-day rolling 
average), effective January 1, 2017 (first compliance date January 31, 
2017), until December 31, 2025 if closing or August 31, 2021 if 
converting to natural gas; and
     Craig Unit 1 will be subject to an annual NOX 
emission limit of 4,065 tpy effective December 31, 2019, which will be 
calculated on a calendar year basis beginning in 2020.
    The amendments also excepted Craig Unit 1 from complying with the 
original SIP effective date of January 30, 2013, and associated 
compliance date 5 years later. The Colorado Air Quality Control 
Commission adopted the revisions on December 15, 2016 (effective 
February 14, 2017).
1. Shutdown
    For the shutdown compliance path, the State considered two 
amortization periods to reflect the remaining useful life based on two 
possible projected compliance dates and the shutdown date of December 
31, 2025. The first scenario used an amortization period of 4 years and 
4 months, calculated as the difference between a projected compliance 
date of August 31, 2021, (which would have been required under the 
State's BART determination made in conjunction with the 2014 
settlement) and the December 31, 2025 shutdown date. The associated 
emissions reductions, annualized cost, and cost-effectiveness values 
for SNCR and SCR using the amortization period is shown in Table 1.

                                Table 1--Craig Station Unit 1 NOX Cost Comparison
                                        [4 years, 4 months of operation]
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                                                                     Emissions                         Cost
                       Control technology                            reduction      Annualized     effectiveness
                                                                       (tpy)         cost ($)         ($/ton)
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SNCR............................................................             779       6,172,522           7,928
SCR.............................................................           4,048      64,106,699          15,835
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    The second scenario used an amortization period of 8 years, to 
reflect the difference between the December 31, 2025 shutdown date and 
the December 31, 2017 compliance date that the 2012 SIP revision 
approval established.\23\ The associated emissions reductions, 
annualized costs, and cost-effectiveness values for SNCR and SCR using 
the amortization period of 8 years is shown in Table 2.
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    \23\ The operation period begins in calendar year 2018 (December 
31, 2017). The effective date of the EPA's approval of Colorado's 
regional haze SIP was January 30, 2013. As noted previously, the 
Tenth Circuit vacated the EPA's approval of the Craig portions of 
this SIP on December 22, 2014.

                                Table 2--Craig Station Unit 1 NOX Cost Comparison
                                             [8 years of operation]
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                                                                     Emissions                         Cost
                       Control technology                            reduction      Annualized     effectiveness
                                                                       (tpy)         cost ($)         ($/ton)
----------------------------------------------------------------------------------------------------------------
SNCR............................................................             779       4,755,842           6,109
SCR.............................................................           4,048      41,476,535          10,245
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    Under both amortization scenarios, the remaining useful life of 
Craig Unit 1 is shorter than the 20-year amortization period used in 
the 2012 BART determination, which increases the annualized costs and 
cost-effectiveness values of the control technologies.\24\ Based on 
this assessment, the State determined that neither SNCR or SCR is cost-
effective when the remaining useful life is shortened to either 4 years 
and 4 months or 8 years, depending on the scenario selected, as a 
result of the shutdown of Craig Unit 1 on December 31, 2025.
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    \24\ The EPA finalized revisions to the Air Pollution Control 
Cost Manual (Chapters 1 and 2), https://www.epa.gov/economic-and-cost-analysis-air-pollution-regulations/cost-reports-and-guidance-air-pollution, in May 2016; these revisions change the amortization 
period for SCR from 20 years to 30 years. The amortization period 
for SNCR remains at 20 years.
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2. Natural Gas Conversion
    For the natural gas conversion compliance path, Craig Unit 1 will 
cease to burn coal by August 31, 2021, with the option to convert to 
natural-gas firing by August 31, 2023. A 30-day rolling average 
NOX emission limit of no more than 0.07 lb/MMBtu will apply 
after August 31, 2021.

C. The EPA's Evaluation of Craig Unit 1 Amendments

    We are proposing to approve Colorado's BART reassessment for two 
possible compliance scenarios for Craig

[[Page 18247]]

Unit 1: (1) Shutdown or (2) conversion to natural gas.
    As a threshold matter, we agree with the State's assessment that an 
emission limit of 0.07 lb/MMBtu would be NOX BART for Craig 
Unit 1 under either a 20- or 30-year remaining useful life. But we also 
agree with the State that it is appropriate to reassess the 
NOX BART limit under the shutdown and natural gas conversion 
scenarios, either of which would considerably shorten the remaining 
useful life of the existing coal-fired boiler.
    While the RHR does not require states to consider source 
retirements or fuel switching (e.g., from coal to gas) as BART options, 
states are free to do so.\25\ In other states, we have approved state-
adopted requirements for the shutdown of a source or for switching 
fuels, which have usually been negotiated between the source operator 
and the state. We also have approved BART determinations that took into 
account the resulting shorter remaining useful life of the affected 
source.
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    \25\ 40 CFR part 51, appendix Y.
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    We agree with Colorado's BART reassessment for both the shutdown 
and natural gas conversion scenarios. Specifically, we acknowledge and 
agree with the assumptions used to calculate the two different 
amortization periods for the shutdown scenario. In past SIP actions, 
the EPA has measured amortization periods from the projected compliance 
date to the date of retirement. In this instance, the compliance date 
for SCR is August 31, 2021, which would have been required under the 
State's BART determination made in conjunction with the 2014 
settlement, resulting in an amortization period of four years and four 
months as reflected in Colorado's first amortization period scenario 
(Table 1). For SNCR, the projected compliance date would be earlier, 
thus resulting in a longer amortization period, albeit one shorter than 
8 years; the 8-year amortization period is therefore a conservative 
approach that understates the annualized costs of both SCR and SNCR.
    When considering the shortened remaining useful life under either 
amortization scenario associated with Craig Unit 1 shutting down by 
December 31, 2025, the EPA finds Colorado's determination reasonable 
that neither SNCR or SCR is cost effective. Therefore, we are proposing 
to approve Colorado's NOX BART reassessment that if Craig 
Unit 1 shuts down by December 31, 2025, neither SNCR or SCR would be 
BART due to the high cost-effectiveness values associated with a 
shortened remaining useful life. We are also proposing to approve the 
alternative compliance path that allows Craig Unit 1 to convert to 
natural-gas firing by August 31, 2023, and cease burning coal by August 
31, 2021, with an associated NOX BART emission limit of 0.07 
lb/MMBtu (30-day rolling average) on that date, because this emission 
limit is equivalent to the one that the State found would be BART under 
a 20- or 30-year remaining useful life scenario. Accordingly, natural-
gas firing is another means by which NOX BART can be met for 
Craig Unit 1. Finally, we are proposing to approve Colorado's 
requirement that an annual NOX limit of 4,065 tpy will be 
effective on December 31, 2019, for Craig Unit 1 because this 
additional measure would strengthen the SIP as there currently is no 
regional haze annual NOX limit for Unit 1.

IV. Nucla--NOX Reasonable Progress

A. Background

    The Tri-State Nucla Station is located in Montrose County 
approximately 3 miles southeast of the town of Nucla, Colorado. The 
Nucla facility consists of one coal-fired steam-driven electric 
generating unit, Unit 4, with a rated electric generating capacity of 
110 MW (gross).
    In 2006, Tri-State installed a small-scale SNCR system on Unit 4 
that injects anhydrous ammonia to achieve NOX reductions. 
The SNCR system is used when NOX emissions approach 0.4 lb/
MMBtu; rates above this result in mass emissions that approach the 
annual permitted NOX limit of 1,987.9 tpy (12-month rolling 
average). Although Colorado, in its 2011 submittal, determined that 
full-scale SNCR and SCR were technically feasible for reducing 
NOX emissions at Nucla Unit 4, the State determined that 
neither control technology was necessary for reasonable progress based 
on the uncertainty of the control efficiency for SNCR and what Colorado 
determined would likely be excessive costs associated with SCR. 
Instead, Colorado determined that Nucla Unit 4 should meet an emission 
limit of 0.5 lb/MMBtu (30-day rolling average) as expeditiously as 
practicable, but in no event later than December 31, 2017, based on 
consideration of the four reasonable progress factors. The EPA approved 
this emission limit into the SIP on December 31, 2012, as meeting the 
relevant regional haze requirements.

B. May 26, 2017 Submittal

    The May 26, 2017 submittal includes the following amendments to the 
Colorado Code of Regulations, Regulation Number 3, Stationary Source 
Permitting and Air Pollutant Emission Notice Requirements, Part F, 
Regional Haze Limits--Best Available Retrofit Technology (BART) and 
Reasonable Progress (RP), Section VI, Regional Haze Determinations, 
related to Nucla:
     Nucla will close on or before December 31, 2022; and
     Nucla will be subject to an annual NOX emission 
limit of 952 tpy effective January 1, 2020, on a calendar year basis 
beginning in 2020.
    The amendments also removed Nucla's original compliance date of 
December 31, 2017, and the requirement for a proposed compliance 
schedule from Nucla due within 60 days after the EPA's approval of the 
reasonable progress portion of Colorado's regional haze SIP. The 
current NOX emission limit of 0.5 lb/MMBtu (30-day rolling 
average) is not amended.

C. The EPA's Evaluation of Nucla Amendments

    Because the amendments, requiring Nucla to shut down on or before 
December 31, 2022, and meet an annual NOX limit of 952 tpy 
by January 1, 2020, do not alter the previously approved 0.5 lb/MMBtu 
(30-day rolling average) emission limit requirement, the closure of 
Nucla achieves greater NOX emission reductions than the 
relevant portions of the 2012 SIP, (which did not previously include 
any shutdown date). We therefore propose to approve Colorado's revision 
related to Nucla.

V. Coordination With FLMs

    Class I areas in Colorado are managed by either the U.S. Forest 
Service (FS) or the U.S. National Park Service (NPS). As described in 
section II.D of this proposed rule, the Regional Haze Rule grants the 
FLMs a special role in the review of regional haze SIPs. Under 40 CFR 
51.308(i)(2), Colorado was obligated to provide the FS and the NPS with 
an opportunity for consultation in development of the State's proposed 
SIP revisions. Colorado provided the FS and the NPS with access to the 
proposed revisions to Regulation Number 3, Part F on January 12, 
2017.\26\ The FLMs did not provide any comments on the proposed 
revisions.
---------------------------------------------------------------------------

    \26\ Email between Colorado and NPS, January 2017.
---------------------------------------------------------------------------

VI. The EPA's Proposed Action

    In this action, the EPA is proposing to approve SIP amendments to 
Regulation Number 3, Part F, Section VI, shown in Table 3, submitted by 
the State of Colorado on May 26, 2017, addressing the NOX 
BART and reasonable progress

[[Page 18248]]

requirements for Craig Unit 1 and Nucla, respectively.

  Table 3--List of Colorado Amendments That EPA Is Proposing To Approve
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
    Amended Sections in May 26, 2017 Submittal Proposed for Approval
------------------------------------------------------------------------
Regulation Number 3, Part F: VI.A.2 (table); VI.A.3; VI.A.4; VI.B.2
 (table); VI.B.3; VI.B.4; VI.D; VI.E.
------------------------------------------------------------------------

VII. Incorporation by Reference

    In this rule, the EPA is proposing to include in a final EPA rule 
regulatory text that includes incorporation by reference. In accordance 
with requirements of 1 CFR 51.5, the EPA is proposing to incorporate by 
reference the amendments described in section VI. The EPA has made, and 
will continue to make, these materials generally available through 
www.regulations.gov and at the EPA Region 8 Office (please contact the 
person identified in the FOR FURTHER INFORMATION CONTACT section of 
this preamble for more information).

VIII. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP 
submission that complies with the provisions of the Act and applicable 
federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in 
reviewing SIP submissions, the EPA's role is to approve state choices, 
provided that they meet the criteria of the CAA. Accordingly, this 
action merely proposes to approve state law as meeting federal 
requirements and does not impose additional requirements beyond those 
imposed by state law. For that reason, this proposed action:
     Is not a significant regulatory action subject to review 
by the Office of Management and Budget under Executive Orders 12866 (58 
FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
     Is not an Executive Order 13771 (82 FR 9339, February 2, 
2017) regulatory action because SIP approvals are exempted under 
Executive Order 12866;
     Does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or 
uniquely affect small governments, as described in the Unfunded 
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
     Is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the 
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 
note) because application of those requirements would be inconsistent 
with the Clean Air Act; and
     Does not provide the EPA with the discretionary authority 
to address, as appropriate, disproportionate human health or 
environmental effects, using practicable and legally permissible 
methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
    In addition, the SIP is not proposed to apply on any Indian 
reservation land or in any other area where the EPA or an Indian tribe 
has demonstrated that a tribe has jurisdiction. In those areas of 
Indian country, the rule does not have tribal implications and will not 
impose substantial direct costs on tribal governments or preempt tribal 
law as specified by Executive Order 13175 (65 FR 67249, November 9, 
2000).

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by 
reference, Intergovernmental relations, Nitrogen dioxide, Particulate 
matter, Sulfur oxides.

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

    Dated: April 16, 2018.
Debra Thomas,
Acting Regional Administrator, Region 8.
[FR Doc. 2018-08622 Filed 4-25-18; 8:45 am]
 BILLING CODE 6560-50-P