Document ID: EPA-R04-OAR-2019-0294-0001
Agency: epa
Document Type: Proposed Rule
Title: Air Quality State Implementation Plans; Approvals and Promulgations: Tennessee: Chattanooga NSR Reform
Posted Date: 2020-02-11T05:00Z

[Federal Register Volume 85, Number 28 (Tuesday, February 11, 2020)]
[Proposed Rules]
[Pages 7686-7692]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-02608]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2019-0294; FRL-10005-10-Region 4]

Air Plan Approval; Tennessee: Chattanooga NSR Reform

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to 
approve revisions to the Tennessee State Implementation Plan (SIP) 
submitted through two letters dated June 25, 2008, and September 12, 
2018. The SIP revisions were submitted by the Tennessee Department of 
Environment and Conservation (TDEC) on behalf of the Chattanooga/
Hamilton County Air Pollution Control Bureau and modify the Prevention 
of Significant Deterioration (PSD) regulations in the Chattanooga 
portion of the Tennessee SIP to address changes to the federal new 
source review (NSR) regulations in recent years for the implementation 
of the national ambient air quality standards (NAAQS). Additionally, 
the SIP revisions include updates to Chattanooga's regulations of 
nitrogen oxides (NOx) and other miscellaneous typographical and 
administrative updates. This action is being proposed pursuant to the 
Clean Air Act (CAA or Act).

DATES: Comments must be received on or before March 12, 2020.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R04-
OAR-2019-0294 at http://www.regulations.gov. Follow the online 
instructions for submitting comments. Once submitted, comments cannot 
be edited or removed from Regulations.gov. 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. 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.

FOR FURTHER INFORMATION CONTACT: Andres Febres, Air Regulatory 
Management Section, Air Planning and Implementation Branch, Air and 
Radiation Division, U.S. Environmental Protection Agency, Region 4, 61 
Forsyth Street SW, Atlanta, Georgia 30303-8960. The telephone number is 
(404) 562-8966. Mr. Febres can also be reached via electronic mail at 
febres-martinez.andres@epa.gov.

SUPPLEMENTARY INFORMATION: 

I. What action is EPA proposing?

    EPA is proposing to approve changes to the Chattanooga portion of 
the Tennessee SIP regarding PSD permitting, as well as updates to the 
regulations of NOx and other miscellaneous typographical and 
administrative updates, submitted by TDEC on behalf of the Chattanooga/
Hamilton County Air Pollution Control Bureau (Bureau) through two 
letters dated June 25, 2008, and September 12, 2018.1 2 3 
EPA is proposing to approve portions of these SIP revisions that make 
changes to the Chattanooga City Code, Part II, Chapter 4, Article II, 
Section 4-41. Specifically, EPA is proposing to approve changes in 
Section 4-41, which include updates to Rule 2--Regulation of Nitrogen 
Oxides; Rule 9--Regulation of Visible Emissions from Internal 
Combustion Engines, and Rule 18--Prevention of Significant 
Deterioration of Air Quality.4 5 6 7
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    \1\ EPA notes that the Agency received the SIP revisions on July 
8, 2008, and September 18, 2018, respectively.
    \2\ The Bureau is comprised of Hamilton County and the 
municipalities of Chattanooga, Collegedale, East Ridge, Lakesite, 
Lookout Mountain, Red Bank, Ridgeside, Signal Mountain, Soddy Daisy, 
and Walden. The Bureau recommends regulatory revisions, which are 
subsequently adopted by the eleven jurisdictions. The Bureau then 
implements and enforces the regulations, as necessary, in each 
jurisdiction.
    \3\ On January 16, 2020, TDEC submitted, on behalf of the 
Bureau, a letter dated January 15, 2020, providing supplemental 
information for the September 12, 2018, submittal. This letter is 
discussed in this proposed action and is available in the Docket.
    \4\ The list of SIP-approved rules for Chattanooga/Hamilton 
County, found at Table 4 of 40 CFR 52.2220(c), currently shows the 
title of Section 4-41, Rule 18 as ``Prevention of Significant Air 
Quality Deterioration.'' In this notice of proposed rulemaking 
(NPRM), EPA is also proposing to approve a change to this title to 
instead show ``Prevention of Significant Deterioration of Air 
Quality.''
    \5\ The June 25, 2008, and September 12, 2018, SIP packages 
include other proposed changes to the Chattanooga portion of the 
Tennessee SIP. Some of these revisions were only included for 
information and are not being requested for approval. EPA has taken 
separate action or will consider taking separate action to approve 
the remaining portions of these revisions. EPA will address only the 
aforementioned rules in this NPRM.
    \6\ In this proposed action, EPA is also proposing to approve 
substantively identical changes from Chattanooga's Section 4-41, 
Rule 18, in the following sections of the Air Pollution Control 
Regulations/Ordinances for the remaining jurisdictions within the 
Bureau, which were locally effective as of the relevant dates below: 
Hamilton County--Section 41, Rule 18 (9/6/17); City of Collegedale--
Section 14-341, Rule 18 (10/16/17); City of East Ridge--Section 8-
41, Rule 18 (10/12/17); City of Lakesite--Section 14-41, Rule 18 
(10/17/17); City of Red Bank--Section 20-41, Rule 18 (11/21/17); 
City of Soddy-Daisy--Section 8-41, Rule 18 (10/5/17); City of 
Lookout Mountain--Section 41, Rule 18 (11/14/17); City of Ridgeside 
Section 41, Rule 18 (1/16/18); City of Signal Mountain Section 41, 
Rule 18 (10/20/17); and City of Walden Section 41, Rule 18 (10/16/
17). However, changes to Chattanooga's Section 4-41, Rule 2 and Rule 
9, only apply to the City of Chattanooga (12/12/07), Hamilton 
County--Section 4-41, Rules 2 and 9 (11/7/07), and City of 
Collegedale--Section 14-341, Rules 2 and 9 (1/22/08); therefore, EPA 
is not proposing approval of any corresponding Regulations/
Ordinances for the remaining municipalities.
    \7\ Because the air pollution control regulations/ordinances 
adopted by the jurisdictions within the Bureau are substantively 
identical, EPA refers solely to Chattanooga and the Chattanooga 
rules throughout the notice as representative of the other ten 
jurisdictions for brevity and simplicity.

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[[Page 7687]]

    Aside from making typographical and administrative corrections to 
some of the rules, these SIP revisions are meant to address changes to 
the federal NSR regulations, as promulgated by EPA in various rules and 
described below. Additional detail on EPA's analysis of these SIP 
revisions and its reasoning for proposing to approve them is presented 
in the sections below.

II. Background

A. 2002 NSR Reform Rules

    On December 31, 2002, EPA published final rule revisions to title 
40 Code of Federal Regulations (CFR) parts 51 and 52, regarding the 
CAA's PSD and Nonattainment New Source Review (NNSR) programs. See 67 
FR 80186 (hereinafter referred to as the 2002 NSR Rule). The revisions 
included five changes to the major NSR program that would reduce 
burden, maximize operating flexibility, improve environmental quality, 
provide additional certainty, and promote administrative efficiency. 
Initially, these updates to the federal NSR program included the 
adoption of baseline actual emissions, actual-to-projected-actual 
emissions methodology, plant-wide applicability limits (PALs), Clean 
Units, and pollution control projects (PCPs). The final rule also 
codified a longstanding policy regarding the calculation of baseline 
emissions for electric utility steam generating units and the 
definition of ``regulated NSR pollutant'' that clarifies which 
pollutants are regulated under the Act for purposes of major NSR.
    Following publication of the 2002 NSR Rule, EPA received numerous 
petitions requesting reconsideration of several aspects of the final 
rule, along with portions of EPA's 1980 NSR Rules. See 45 FR 52676 
(August 7, 1980). On July 30, 2003, EPA granted petitions for 
reconsideration of six issues presented by the petitioners and opened a 
new comment period for the public.\8\ As a result of the 
reconsideration, on November 7, 2003 (68 FR 63021), EPA published the 
NSR Reform Reconsideration Rule. In the reconsideration rule, EPA made 
a final determination not to change any of the six issues opened for 
reconsideration but did make two clarifications to the rule. These two 
clarifications included: (1) Adding the definition of ``replacement 
unit'' to indicate that it is considered an existing unit in terms of 
major NSR applicability, and (2) specifying that the PAL baseline 
calculation procedures for newly constructed units do not apply to 
modified units. The 2002 NSR Rule and the NSR Reform Reconsideration 
Rule are hereinafter collectively referred to as the ``2002 NSR Reform 
Rules.''
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    \8\ For full details on the six issues reconsidered by EPA, 
refer to the July 30, 2003, notice. See 68 FR 44624.
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    The 2002 NSR Reform Rules were challenged in the U.S. Court of 
Appeals for the District of Columbia Circuit (D.C. Circuit), and the 
court issued a decision on the challenges on June 24, 2005. See New 
York v. United States, 413 F.3d 3 (D.C. Cir. 2005). In summary, the 
D.C. Circuit vacated portions of EPA's NSR rules pertaining to Clean 
Units and PCPs, remanded a portion of the rules regarding recordkeeping 
and the term ``reasonable possibility'' found in 40 CFR 52.21(r)(6), 40 
CFR 51.166(r)(6), and 40 CFR 51.165(a)(6) to EPA, and either upheld or 
did not comment on the other provisions included as part of the 2002 
NSR Reform Rules. On June 13, 2007 (72 FR 32526), EPA took final action 
to revise the 2002 NSR Reform Rules to exclude the portions that were 
vacated by the D.C. Circuit.
    Meanwhile, EPA continued to move forward with its evaluation of the 
portion of its NSR Reform Rules that were remanded by the D.C. Circuit. 
On March 8, 2007 (72 FR 10445), EPA responded to the Court's remand 
regarding the recordkeeping provisions by proposing two alternative 
options to clarify what constitutes ``reasonable possibility'' and when 
the ``reasonable possibility'' recordkeeping requirements apply. The 
``reasonable possibility'' standard identifies the circumstances under 
which a major stationary source must keep records for modifications 
that do not trigger major NSR. EPA later finalized these changes on 
December 21, 2007 (72 FR 72607).
    Separately from the petitions received that led to the 2002 NSR 
Reconsideration Rule, EPA received another petition for reconsideration 
on July 11, 2003. Specifically, the petitioner requested EPA to 
reconsider the inclusion of ``fugitive emissions'' when assessing 
whether a proposed physical or operational change qualified as a 
``major modification.'' On November 13, 2007, EPA granted the petition 
for reconsideration, and on December 19, 2008, finalized the revision 
of the language to clarify which types of sources were required to 
include ``fugitive emissions'' in their calculations. See 73 FR 77882 
(hereinafter referred to as the Fugitive Emissions Rule).
    Finally, on February 17, 2009, EPA received one additional petition 
challenging the Fugitive Emissions Rule. Due to this petition, and 
after several stays,\9\ EPA established an interim stay on March 30, 
2011 (76 FR 17548), in which most of the Fugitive Emissions Rule 
language was stayed indefinitely. With the March 30, 2011, stay, EPA 
specified which portions of 40 CFR 51.165, 40 CFR 51.166, and 40 CFR 
52.21 were stayed indefinitely, which were reinstated, and which were 
revised, in order to revert the federal rules to regulatory language 
that existed prior to the Fugitive Emissions Rule.
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    \9\ EPA originally established a three-month stay that became 
effective September 30, 2009 (74 FR 50115), which was later extended 
for an additional three months, effective December 31, 2009. See 74 
FR 65692. In order to allow for more time for the reconsideration 
and for public comment on any potential revisions to the Fugitive 
Emissions Rule, EPA established a longer 18-month stay that became 
effective on March 31, 2010. See 75 FR 16012.
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    In summary, after several court decisions and public petitions, the 
federal major NSR program (found in 40 CFR 51.165, 51.166, and 52.21) 
no longer includes the provisions related to Clean Units or PCPs that 
were part of the 2002 NSR reform rules. Additionally, an indefinite 
stay has been placed on the language related to the Fugitive Emissions 
Rule. Chattanooga is adopting all of the surviving provisions from the 
2002 NSR Reform Rules and is not adopting all those provisions that 
were either vacated or stayed indefinitely. More details on 
Chattanooga's adoption of the 2002 NSR Reform Rules and our analysis of 
its submittals can be found in section III below.

B. Fine Particulate Matter (PM2.5) NAAQS

1. Implementation of NSR for the PM2.5 NAAQS and 
Grandfathering Provisions
    On May 16, 2008 (73 FR 28321), EPA published the ``Implementation 
of the New Source Review (NSR) Program for Particulate Matter Less than 
2.5 Micrometers (PM2.5)'' Final Rule (hereinafter referred 
to as the NSR PM2.5 Rule). The 2008 NSR PM2.5 
Rule revised the NSR program requirements to establish the framework 
for implementing preconstruction permit review for the PM2.5 
NAAQS in both attainment and nonattainment areas. As indicated in the 
2008 NSR PM2.5 Rule,

[[Page 7688]]

major stationary sources seeking permits must begin directly satisfying 
the PM2.5 requirements, as of the effective date of the 
rule, rather than relying on PM10 as a surrogate, with two 
exceptions. The first exception was a ``grandfathering'' provision in 
the federal PSD program at 40 CFR 52.21(i)(1)(xi). This grandfathering 
provision applied to sources that had applied for, but had not yet 
received, a final and effective PSD permit before the July 15, 2008, 
effective date of the May 2008 final rule. The second exception was 
that states with SIP-approved PSD programs could continue to implement 
a policy in which PM10 served as a surrogate for 
PM2.5 for up to three years (until May 2011) or until the 
individual revised state PSD programs for PM2.5 are approved 
by EPA, whichever came first.\10\
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    \10\ After EPA promulgated the NAAQS for PM2.5 in 
1997, the Agency issued a guidance document entitled ``Interim 
Implementation of New Source Review Requirements for 
PM2.5,'' which allows for the regulation of 
PM10 as a surrogate for PM2.5 until 
significant technical issues were resolved (the ``PM10 
Surrogate Policy''). John S. Seitz, EPA, October 23, 1997.
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    On February 11, 2010 (75 FR 6827), EPA proposed to repeal the 
grandfathering provision for PM2.5 contained in the federal 
PSD program at 40 CFR 52.21(i)(1)(xi) and to end early the 
PM10 Surrogate Policy applicable in states that have a SIP-
approved PSD program. In support of this proposal, EPA explained that 
the PM2.5 implementation issues that led to the adoption of 
the PM10 Surrogate Policy in 1997 had been largely resolved 
to a degree sufficient for sources and permitting authorities to 
conduct meaningful permit-related PM2.5 analyses. On May 18, 
2011 (76 FR 28646), EPA took final action to repeal the 
PM2.5 grandfathering provision at 40 CFR 52.21(i)(1)(xi). 
This final action ended the use of the 1997 PM10 Surrogate 
Policy for PSD permits under the federal PSD program at 40 CFR 52.21. 
In effect, any PSD permit applicant previously covered by the 
grandfathering provision (for sources that completed and submitted a 
permit application before July 15, 2008) \11\ that did not have a final 
and effective PSD permit before the effective date of the repeal will 
not be able to rely on the 1997 PM10 Surrogate Policy to 
satisfy the PSD requirements for PM2.5 unless the 
application includes a valid surrogacy demonstration.
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    \11\ Sources that applied for a PSD permit under the federal PSD 
program on or after July 15, 2008, are already excluded from using 
the 1997 PM10 Surrogate Policy as a means of satisfying 
the PSD requirements for PM2.5. See 73 FR 28321.
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    The NSR PM2.5 Rule also established the following NSR 
requirements for PSD to implement the PM2.5 NAAQS: (1) 
Required NSR permits to address directly emitted PM2.5 and 
precursor pollutants; (2) established significant emission rates for 
direct PM2.5 and precursor pollutants (including sulfur 
dioxide (SO2) and NOX); and (3) required states 
to account for gases that condense to form particles (``condensables'') 
in PM2.5 and PM10 emission limits in PSD or NNSR 
permits.
2. PM2.5 Condensables Correction Rule
    Among the changes included in the 2008 NSR PM2.5 Rule 
mentioned above, the EPA also revised the definition of ``regulated NSR 
pollutant'' for PSD to add a paragraph providing that ``particulate 
matter (PM) emissions, PM2.5 emissions and PM10 
emissions shall include gaseous emissions from a source or activity 
which condense to form particulate matter at ambient temperatures'' and 
that on or after January 1, 2011, ``such condensable particulate matter 
shall be accounted for in applicability determinations and in 
establishing emissions limitations for PM, PM2.5 and 
PM10 in permits.'' See 73 FR 28321 at 28348 (May 16, 2008). 
A similar paragraph added to the NNSR rule did not include 
``particulate matter (PM) emissions.'' See 40 CFR 
51.165(a)(1)(xxxvii)(D).
    On October 25, 2012 (77 FR 65107), EPA took final action to amend 
the definition, promulgated in the 2008 NSR PM2.5 Rule, of 
``regulated NSR pollutant'' contained in the PM condensable provision 
at 40 CFR 51.166(b)(49)(vi), 52.21(b)(50)(i) and Appendix S to 40 CFR 
51 (hereinafter referred to as the PM2.5 Condensables 
Correction Rule). The PM2.5 Condensables Correction Rule 
removed the inadvertent requirement in the 2008 NSR PM2.5 
Rule that the measurement of condensable particulate matter be included 
as part of the measurement and regulation of ``particulate matter 
emissions'' under the PSD program. The term ``particulate matter 
emissions'' includes only filterable particles that are larger than 
PM2.5 and larger than PM10.

C. 1997 8-Hour Ozone NAAQS Phase 2 Rule

    On November 29, 2005 (70 FR 71612), EPA published a final rule 
entitled ``Final Rule To Implement the 8-Hour Ozone National Ambient 
Air Quality Standard--Phase 2; Final Rule To Implement Certain Aspects 
of the 1990 Amendments Relating to New Source Review and Prevention of 
Significant Deterioration as They Apply in Carbon Monoxide, Particulate 
Matter and Ozone NAAQS; Final Rule for Reformulated Gasoline'' 
(hereinafter referred to as the Phase 2 Rule). The Phase 2 Rule 
addressed control and planning requirements as they applied to areas 
designated nonattainment for the 1997 8-hour ozone NAAQS \12\ such as 
reasonably available control technology, reasonably available control 
measures, reasonable further progress, modeling and attainment 
demonstrations, NSR, and the impact to reformulated gasoline for the 
1997 8-hour ozone NAAQS transition. Additionally, regarding the NSR 
permitting requirements which are relevant to this action, the Phase 2 
Rule included the following provisions: (1) Recognized NOX 
as an ozone precursor for PSD purposes; and (2) established significant 
emission rates for the 8-hour ozone, PM10 and carbon 
monoxide NAAQS.
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    \12\ On July 18, 1997, EPA promulgated a revised 8-hour ozone 
NAAQS of 0.08 parts per million (ppm)--also referred to as the 1997 
8-hour ozone NAAQS. On April 30, 2004, EPA designated areas as 
unclassifiable/attainment, nonattainment and unclassifiable for the 
1997 8-hour ozone NAAQS. In addition, on April 30, 2004 (69 FR 
23951), as part of the framework to implement the 1997 8-hour ozone 
NAAQS, EPA promulgated an implementation rule in two phases (Phase I 
and II). The Phase I Rule (effective on June 15, 2004), provided the 
implementation requirements for designating areas under subpart 1 
and subpart 2 of the CAA.
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    The June 25, 2008, and September 12, 2018, revisions requesting 
adoption of Chattanooga's Rule 18 adopt all the NSR provisions of the 
Phase 2 Rule as they appear in the federal PSD rules, effectively 
recognizing NOX as a precursor to ozone as well as 
establishing significant emission rates for PM10. The 
adoption of these provisions is consistent with the federal NSR rules 
as well as TDEC's rules.

D. Equipment Replacement Provision

    Under federal regulations, certain activities are not considered to 
be a physical change or a change in the method of operation at a 
source, and thus do not trigger NSR review. One category of such 
activities is routine maintenance, repair and replacement (RMRR). On 
October 27, 2003 (68 FR 61248), EPA published a rule titled 
``Prevention of Significant Deterioration (PSD) and Non-Attainment New 
Source Review (NSR): Equipment Replacement Provision of the Routine 
Maintenance, Repair and Replacement Exclusion'' (hereinafter referred 
to as the ERP Rule). The ERP Rule provided criteria for determining 
whether an activity falls within the RMRR exemption. The ERP Rule also 
provided a list of equipment replacement activities that are exempt

[[Page 7689]]

from NSR permitting requirements, while ensuring that industries 
maintain safe, reliable, and efficient operations that will have little 
or no impact on emissions. Under the ERP Rule, a facility undergoing 
equipment replacement would not be required to undergo NSR review if 
the facility replaced any component of a process unit with an identical 
or functionally equivalent component. The rule included several 
modifications to the NSR rules to explain what would qualify as an 
identical or functionally equivalent component.
    Shortly after the October 27, 2003, rulemaking, several parties 
filed petitions for review of the ERP Rule in the U.S. Court of Appeals 
for the District of Columbia Circuit (D.C. Circuit). The D.C. Circuit 
stayed the effective date of the rule pending resolution of the 
petitions. A collection of environmental groups, public interest 
groups, and States, subsequently filed a petition for reconsideration 
with EPA, requesting that the Agency reconsider certain aspects of the 
ERP Rule. EPA granted the petition for reconsideration on July 1, 2004 
(69 FR 40278).\13\ After the reconsideration, EPA published its final 
response on June 10, 2005 (70 FR 33838), which stated that the Agency 
would not change any aspects of the ERP. On March 17, 2006, the D.C. 
Circuit acted on the petitions for review and vacated the ERP Rule.\14\
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    \13\ The reconsideration granted by EPA opened a new 60-day 
public comment period, including a new public hearing, on three 
issues of the ERP: (1) The basis for determining that the ERP was 
allowable under the CAA; (2) the basis for selecting the cost 
threshold (20 percent of the replacement cost of the process unit) 
that was used in the final rule to determine if a replacement was 
routine; and (3) a simplified procedure for incorporating a Federal 
Implementation Plan into State Plans to accommodate changes to the 
NSR rules.
    \14\ New York v. EPA, 443 F.3d 880 (D.C. Cir. 2006).
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    The June 25, 2008, submittal includes portions of the ERP Rule for 
adoption. Although the ERP rule is vacated, EPA is proposing to approve 
those portions of the June 25, 2008, submittal, consistent with EPA's 
December 20, 2019,\15\ proposed rulemaking which would add certain 
portions back to the major NSR rules, as explained further in Section 
III of this proposed action.
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    \15\ See 84 FR 70092.
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III. Analysis of State's Submittal

A. Section 4-41, Rule 18--Prevention of Significant Deterioration of 
Air Quality

    Chattanooga currently has a SIP-approved PSD program for new and 
modified stationary sources who wish to construct or modify in an area 
designated attainment, under Section 4-41, Rule 18, Prevention of 
Significant Deterioration of Air Quality. The June 25, 2008, and 
September 12, 2018, SIP revisions propose changes to Rule 18 to address 
changes to the federal NSR regulations, as promulgated by EPA in the 
2002 NSR Reform Rules, and subsequent changes in other relevant 
rulemakings as described in section II, above.
    As part of the changes to Rule 18, Chattanooga adopts all the 
necessary provisions of the federal PSD rules (found in 40 CFR 51.166) 
to make them consistent with, and in some cases more stringent than, 
the federal rules. These changes include the adoption of several 
definitions in the federal PSD rules, such as the definition of 
``regulated NSR pollutant,'' as well as provisions regarding major NSR 
applicability procedures, actual-to-projected-actual applicability 
tests, PALs, and recordkeeping. Slight differences between the 
Chattanooga PSD rules and the federal rules are discussed below in 
Section III.A.1.-5.
    Additionally, as part of the changes included in the June 25, 2008, 
and September 12, 2018, SIP revisions, Chattanooga adopts the 
provisions from the Ozone Phase 2 Rule, as discussed in section II.C of 
this rulemaking. Consistent with TDEC's rules and the federal rules, 
Chattanooga adopts the same language regarding the Phase 2 rule found 
at 40 CFR 51.166. This includes amendments found in the federal PSD 
rules in subparagraphs 51.166(b)(1)(ii), 51.166(b)(2)(ii), 
51.166(b)(23)(i), and 51.166(b)(49)(i).
    EPA believes that the proposed approval of these changes, including 
all amendments mentioned in the following sections, will not have a 
negative impact on air quality in the Chattanooga-Hamilton County area. 
With these proposed changes, the local regulations will now be 
consistent with the State's current SIP-approved PSD program, which is 
slightly more stringent than the federal rules. Tennessee's PSD program 
already underwent updates concerning the 2002 NSR reform on September 
14, 2007. See 72 FR 52472.
    It is also important to note that the Chattanooga-Hamilton County 
area currently does not have any designated nonattainment areas, and 
all previous nonattainment areas have been redesignated to attainment 
and have clean data.\16\ Additionally, during the most recent 
designations process, for the 2010 1-hour SO2 and the 2015 
8-hour Ozone NAAQS, the entire Hamilton County Area was designated as 
attainment/unclassifiable for both standards.\17\
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    \16\ Air quality design values for all criteria air pollutants 
are available at: https://www.epa.gov/air-trends/air-quality-design-values.
    \17\ See 83 FR 1098 for the third round of designations for the 
2010 1-hour SO2 NAAQS, and 82 FR 54232 for the 2015 8-
hour ozone NAAQS.
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    Although in most cases Chattanooga adopts the federal rules as 
enacted at 51.166, certain portions were modified or not adopted. These 
differences from the federal PSD rules, which are all discussed in the 
sections below, include: (1) Adopting a modified definition of 
``baseline actual emissions;'' (2) not adopting the stayed language in 
the Fugitive Emissions Rule; (3) adopting a different major source 
baseline date for PM2.5; (4) adopting vacated language from 
the ERP rule; and (5) not adopting changes from a May 1, 2007, final 
rule regarding facilities that produce ethanol through natural 
fermentation.\18\
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    \18\ The May 1, 2007, final rule finalized changes to the 
definition of ``chemical process plants'' as it applies to the 
federal PSD, NNSR and Title V programs, including applicability 
thresholds for PSD and the treatment of fugitive emissions in 
determining applicability for major NSR and title V.
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1. Definition of ``baseline actual emissions''
    Regarding the definition of ``baseline actual emissions,'' as 
promulgated in 40 CFR 51.166(b)(47), Chattanooga adopts into Section 4-
41, Rule 18, a definition mostly consistent with the federal 
definition. However, Chattanooga excluded a portion of the definition 
that would allow for different 24-month periods to be chosen for each 
regulated NSR pollutant when calculating baseline actual emissions for 
either PSD applicability determinations.
    Chattanooga's adoption of ``baseline actual emissions'' in Rule 18 
excludes the last sentence of subparagraphs 51.166(b)(47)(i)(c) and 
51.166(b)(47)(ii)(d) of the federal PSD rules, which states that ``a 
different consecutive 24-month period can be used for each regulated 
NSR pollutant.'' Instead, Chattanooga adopts specific language at 
Section 4-41, Rule 18.2(d)(1)(c), which states, ``For a regulated NSR 
pollutant, when a project involves multiple emissions units, one 
consecutive 24-month period must be used to determine the baseline 
actual emissions for the emissions units being changed.'' With this 
difference in the definition, Chattanooga is not allowing for different 
baseline periods to be chosen for a single project that involves 
multiple units, which removes an additional flexibility built into the 
federal rules and makes the local rules slightly more stringent than 
the federal

[[Page 7690]]

rules. This portion of Chattanooga's definition is consistent with 
TDEC's SIP-approved definition of ``baseline actual emissions,'' which 
also does not allow for different pollutant-specific 24-month baseline 
periods.
    However, like TDEC, Chattanooga does retain the authority to allow 
for the use of multiple 24-month baseline periods only if certain 
conditions are met. These conditions are: (1) The new source or 
modification would still be subject to major NSR when using a single 
24-month period; (2) one or more pollutants were emitted at lower 
amounts than permitted during that time; (3) the use of multiple 
baseline periods for any of the pollutants in item (2) above would 
result in the source or modification not being subject to major NSR; 
and (4) the use of the multiple baselines is not prohibited by any 
applicable provision of the federal NSR regulations. Although this 
portion of the definition does allow for the Director to authorize the 
use of multiple baseline periods, Chattanooga's definition is still 
more stringent than the federal definitions because the source or 
modification would have to meet very specific conditions, would have to 
bear the burden for demonstrating that these conditions are met, and 
must obtain the Director's approval in order to use this flexibility.
2. Fugitive Emissions Rule
    As mentioned in Section II.A of this rulemaking, a portion of the 
Fugitive Emissions Rule was stayed indefinitely on March 30, 2011. For 
this reason, Chattanooga did not adopt into Section 4-41, Rule 18, the 
language found in the federal PSD rules at 40 CFR 51.166(b)(2)(v) and 
51.166(b)(3)(iii)(d), which are part of the stayed Fugitive Emissions 
Rule provisions that can still be found in the CFR.
    Given that the omitted language has been stayed indefinitely, EPA 
is proposing to approve the changes into the Chattanooga portion of the 
Tennessee SIP as consistent with federal requirements, and the 
Tennessee SIP.
3. ERP Rule
    Chattanooga's June 25, 2008, SIP revision makes changes to 
Chattanooga's PSD permitting regulations, in part, by adding a 
definition of ``replacement unit'' at Rule 18.2(vv) and by adding 
Section 18.22, which describes ``basic design parameters'' to be 
considered in determining whether the replacement of equipment should 
be considered a new or existing emission unit. Chattanooga's definition 
of ``replacement unit'' mirrors the definition in 40 CFR 51.166(b)(32). 
Therefore, EPA is proposing to approve these changes.
    In addition, EPA's definition of ``replacement unit'' cross 
references the description of ``basic design parameters'' in 40 CFR 
51.166(y)(2). The description of ``basic design parameters'' was added 
to the EPA's PSD regulations on October 27, 2003, as part of the ERP 
Rule, to provide a category of equipment replacement activities that 
are not subject to the NSR requirements under the existing RMRR. Soon 
after, the ERP Rule was vacated in its entirety, as noted in Section 
II.D of this proposed rulemaking, by the D.C. Circuit in the 2006 New 
York v. EPA decision. 443 F.3d 880 (D.C. Cir. 2060). However, the 
definition of ``replacement unit'' was not vacated as part of that 
decision even though it cross referenced the vacated description of 
``basic design parameters'' because it was not part of the ERP, 68 FR 
61247 (October 27, 2003), but rather was added during the final 
reconsideration of NSR Reform, 68 FR 63021 (November 7, 2003). 
Nevertheless, the cross reference to the use of ``basic design 
parameters'' indicates EPA's intention to interpret that term 
consistently between the use of ``replacement unit'' and the ERP.
    Lastly, on December 20, 2019, EPA published a NPRM intended to 
correct various errors in the NSR regulations, which proposed to remove 
the vacated ERP provisions. However, this proposal included 
incorporating into the federal regulations at 40 CFR 51.165(h), 
51.166(y), and 52.21(cc) the concept of ``basic design parameters'' 
because EPA believes that as used in the definition of ``replacement 
unit,'' this is consistent with EPA's interpretation of that provision. 
See 84 FR 70092, 70094 (December 20, 2019). Therefore, EPA is proposing 
to approve Chattanooga's definition of ``replacement unit'' at Rule 
18.2(vv), as well as the addition of Section 18.22 prescribing ``basic 
design parameters,'' because these provisions are consistent with and 
are as stringent as EPA's interpretation of the criteria for ``basic 
design parameters'' and the definition of ``replacement unit.''
4. PM2.5 NAAQS
    The September 12, 2018, submittal adopts the PM2.5 
provisions necessary to implement PSD for the PM2.5 NAAQS. 
However, one difference from the federal rules is that the ``major 
source baseline date'' for PM2.5, the date after which 
actual emissions increases associated with construction at any major 
stationary source consume the PSD increment, is adopted at Rule 
18.2(gg)(1) as October 20, 2011, rather than October 20, 2010.\19\ This 
locally effective date was adopted in error.\20\ However, on January 
16, 2020, TDEC submitted, on behalf of the Bureau, a letter dated 
January 15, 2020, certifying that no construction activity affecting 
actual emissions at a major source took place within Chattanooga, 
Hamilton County, or the other municipalities within the Bureau, between 
the dates of October 20, 2010, and October 20, 2011.\21\ Thus, as the 
letter explains, no PM2.5 increment was consumed in that 
time period. Consequently, there are no functional differences for PSD 
in Hamilton County versus what is required in other areas by the State 
and/or federal rules for the purposes of implementing the 
PM2.5 NAAQS.
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    \19\ The major source baseline date is the date after which 
actual-emissions changes at a major stationary source affect the 
available PSD increment. Other changes in actual emissions occurring 
at any source after the major source baseline date do not affect the 
increment, but instead (until after the minor source baseline date 
is established) contribute to the baseline concentration. After the 
minor source baseline date, all types of emissions changes--and not 
just modifications at major sources--consume or expand the available 
increment.
    \20\ The SIP submission, available in the Docket for this 
proposed action, shows that EPA commented on the typographical 
error, and Chattanooga agreed that it was an error and intended to 
correct the error by adopting the correct October 20, 2010 date.
    \21\ The January 15, 2020, letter is available in the Docket for 
this proposed action.
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5. Other PSD Changes Not Related to NSR Reform
    In addition to proposing revisions to Section 4-41, Rule 18, to 
address changes to the federal NSR regulations, as promulgated by EPA 
in the 2002 NSR Reform Rules, Chattanooga also seeks to delete several 
exemptions from the rule. Under Rule 18.8, Chattanooga currently has 
several exemptions for sources that have obtained or have requested to 
obtain a permit prior to a certain date, which range from 1977 through 
1988.
    The exemptions being proposed for deletion were found in Rule 18.8, 
paragraphs (a)(1) through (5), (9), and (10), as well as paragraphs (f) 
through (j). According to the Bureau, there are currently no sources 
operating within Hamilton County which obtained a PSD permit before 
1988, and it is no longer possible for a source to request a permit 
before this date. As part of the June 25, 2008, and September 12, 2018, 
SIP revisions, Chattanooga seeks to delete the language in the 
paragraphs mentioned above, and instead place a ``(Reserved)'' 
notification in their place.
    EPA has reviewed the changes to the exemptions in Section 4-41, 
Rule 18, and has determined that the changes do not decrease the 
stringency of the PSD

[[Page 7691]]

rules. The deletion of these exemptions, although not functional at 
this time, would be a SIP-strengthening change to Chattanooga's PSD 
rules. Therefore, EPA believes that these changes are approvable 
pursuant to section 110 of the Act and is proposing to approve the 
aforementioned changes into the Chattanooga portion of the Tennessee 
SIP.
    Lastly, the changes to Section 4-41, Rule 18, together with the 
differences mentioned above in section III.A.1. through 5., make 
Chattanooga's PSD regulations generally consistent with the federal 
requirements (and in some cases more stringent, as is the case of the 
definition of ``baseline actual emissions''), as well as consistent 
with TDEC's PSD rules. With the exception of the vacated or stayed 
portions, as mentioned in section II, the adoption of vacated language 
from the ERP rule, the difference in the PM2.5 major source 
baseline date from the federal provisions, and a minor change to the 
permit-rescission provision that was recently adopted by EPA,\22\ 
Chattanooga is adopting all other necessary provisions of the federal 
PSD rules. Therefore, EPA is proposing to approve the aforementioned 
changes to the Chattanooga portion of the Tennessee SIP.
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    \22\ Effective December 7, 2016, EPA removed the July 20, 1987, 
date restriction in its permit-rescission provision at 40 CFR 
52.21(w)(2) and, at 52.21(w)(3), changed the word ``shall'' to 
``may'' to clarify that the permit-rescission provision does not 
create a mandatory duty to grant a rescission request. See 81 FR 
78043 (Nov. 7, 2016). Chattanooga's corresponding regulation at Rule 
18.20 is consistent with the previous version of 40 CFR 52.21.
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B. Section 4-41, Rule 9--Regulation of Visible Emissions From Internal 
Combustion Engines

    Rule 9, of Section 4-41, regulates visible emissions from internal 
combustion engines in order to protect the visibility of an area by 
limiting the time an internal combustion engine may operate at certain 
conditions, as well as the level of opacity that may be caused by the 
visible emissions. The June 25, 2008, SIP revision seeks to correct a 
typographical error that was mistakenly approved into the rule.
    Under paragraph 9.2, the rule currently states that ``no person 
shall cause, suffer, allow or permit the visible emission of air 
contaminants from diesel type engines for a period of more than sixty 
(60) consecutive seconds in excess of twenty (20) capacity opacity'' 
(emphasis added). The typographical correction included in the June 25, 
2008, SIP revision seeks to change the word ``capacity'' to ``percent'' 
in order to clarify that the rule imposes a 20 percent opacity limit.
    EPA has reviewed this change and has preliminarily determined that 
the change to Section 4-41, Rule 9 is a minor typographical correction. 
Therefore, EPA believes that this change is approvable pursuant to 
section 110 of the Act and is proposing to approve the aforementioned 
change into the Chattanooga portion of the Tennessee SIP.

C. Section 4-41, Rule 2--Regulation of Nitrogen Oxides

    Rule 2 of Section 4-41 regulates the emissions of NOX 
from several sources, which include fuel burning equipment, nitric acid 
plants, Portland cement plants, and emergency generators. The June 25, 
2008, SIP revisions seek to lower the amount of NOX that a 
Portland cement plant kiln may emit within a 3-hour period, restrict 
the time of year that these kilns may be operated, and add new 
reporting requirements.
    Under the current SIP-approved version of Section 4-41, Rule 2, 
Portland cement plants are addressed in paragraph 2.6, which imposes a 
NOX limit of no more than 1,500 ppm when averaged over a 
period of three hours. The June 25, 2008, SIP revision proposes to 
lower this limit by fifty percent, to allow emissions of NOX 
of only 750 ppm over a three-hour average.
    Additionally, the proposed changes seek to restrict the time of 
year that Portland cement plant kilns may be operated. Currently, these 
do not have any restriction on when they may operate, as long as they 
stay within the current 1,500 ppm, 3-hour-average limit on 
NOX emissions. The proposed changes would restrict kilns' 
operation between May 1 and September 30, unless they meet certain 
criteria. In order to operate during the May 1 through September 30 
timeframe, a kiln must have one of the following installed: (1) Low-
NOX burner(s); (2) mid-kiln system firing; (3) an 
alternative control technique, approved by the Director of the 
Chattanooga-Hamilton County Air Pollution Control Bureau (Director) and 
the EPA, that achieves the same level of control as low-NOX 
burners or mid-kiln system firing; or (4) reasonably available control 
technology (RACT) approved by the Director and the EPA.
    Lastly, the revisions add a new reporting requirement for sources 
previously subject to this rule. Although the time has expired for 
sources to meet the first condition of the reporting requirements, 
sources that were subject to this rule at the time of the local 
adoption were required to submit an initial report by April 30, 2007. 
This initial report was intended to provide the Director with two 
things: (1) A statement to confirm that the kiln is subject to the 
rule; and (2) a report demonstrating compliance with the new 
requirements of the rule. After the initial report was received, the 
source had to provide a NOX emissions report for the period 
of May 31, 2007, through September 30, 2007, to show compliance was 
being achieved. Thereafter, the source is required to submit an annual 
NOX emissions report, for the May 31 through September 30 
time period, due October 31 of each year. Finally, the annual report is 
required to include a certification that the kiln continues to be in 
compliance with the rule, as stated in the initial certification.
    These changes to Section 4-41, Rule 2, are consistent with TDEC's 
regulations regarding the control of NOX emissions from 
Portland cement plants. Additionally, EPA believes that these changes 
are SIP strengthening, and help better control the emissions from 
cement kilns. Therefore, EPA is proposing to approve the aforementioned 
changes to the Chattanooga portion of the Tennessee SIP.

IV. Incorporation by Reference

    In this document, 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, EPA is proposing to incorporate by 
reference Chattanooga City Code, Part II, Chapter 4, Article II, 
Section 4-41, Rule 2-- Regulation of Nitrogen Oxides; and Rule 9--
Regulation of Visible Emissions from Internal Combustion Engines, both 
state effective December 12, 2007; as well as Rule 18--Prevention of 
Significant Deterioration of Air Quality, state effective January 23, 
2017.\23\ EPA has made, and will continue to make, these materials 
generally available through www.regulations.gov and at the EPA Region 4 
office (please contact the person identified in the For Further 
Information Contact section of this preamble for more information).
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    \23\ As noted in footnote 6 above, EPA's proposed approval of 
the changes to the PSD regulations (Section 4-41, Rule 18) also 
includes substantively identical changes to regulations/ordinances 
submitted for the other ten jurisdictions within the Bureau. 
However, changes to Chattanooga's Section 4-41, Rule 2 and Rule 9, 
only apply to the City of Chattanooga, Hamilton County, and the City 
of Collegedale,
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V. Proposed Action

    EPA is proposing to approve the aforementioned changes to the

[[Page 7692]]

Chattanooga portion of the Tennessee SIP. EPA is proposing to approve 
the changes presented in the June 25, 2008, and September 12, 2018, SIP 
revisions that make changes to Chattanooga's City Code, Part II, 
Chapter 4, Article II, Section 4-41. Specifically, EPA is proposing to 
approve changes in Section 4-41, regarding updates to Rule 2--
Regulation of Nitrogen Oxides; Rule 9--Regulation of Visible Emissions 
from Internal Combustion Engines; and Rule 18--Prevention of 
Significant Deterioration of Air Quality.\24\ These SIP revisions are 
meant to address several changes to the federal NSR regulations, as 
promulgated by EPA on December 31, 2002, and reconsidered with minor 
changes on November 7, 2003, which are commonly referred to as the 
``2002 NSR Reform Rules,'' as well as subsequent changes to the federal 
NSR regulations as described in Section II of this proposed rulemaking. 
Finally, these revisions are meant to make Chattanooga's PSD 
regulations consistent with those of the State of Tennessee. The other 
SIP revisions EPA is proposing to approve include updates to 
Chattanooga's regulations of NOX and other miscellaneous 
typographical and administrative updates.
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    \24\ See footnote 23.
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VI. 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. See 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in 
reviewing SIP submissions, EPA's role is to approve state choices, 
provided that they meet the criteria of the CAA. These actions merely 
propose to approve state law as meeting Federal requirements and does 
not impose additional requirements beyond those imposed by state law. 
For that reason, these proposed actions:
     Are 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);
     Are not an Executive Order 13771 (82 FR 9339, February 2, 
2017) regulatory action because SIP approvals are exempted under 
Executive Order 12866;
     Do not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Are 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.);
     Do 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);
     Do not have Federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Are not an economically significant regulatory action 
based on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
     Are not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Are 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 CAA; and
     Do not provide 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).
    The SIP is not approved to apply on any Indian reservation land or 
in any other area where EPA or an Indian tribe has demonstrated that a 
tribe has jurisdiction. In those areas of Indian country, these rules 
do not have tribal implications as specified by Executive Order 13175 
(65 FR 67249, November 9, 2000), nor will it impose substantial direct 
costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 52

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

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

    Dated: January 28, 2020.
Mary S. Walker,
Regional Administrator, Region 4.
[FR Doc. 2020-02608 Filed 2-10-20; 8:45 am]
BILLING CODE 6560-50-P