Document ID: EPA-R04-OAR-2005-0534-0037
Agency: epa
Document Type: Rule
Title: Approvals and Promulgations of Implementation Plans: North Carolina; Prevention of Significant Deterioration and Nonattainment New Source Review Rules
Posted Date: 2011-08-10T04:00Z

[Federal Register Volume 76, Number 154 (Wednesday, August 10, 2011)]
[Rules and Regulations]
[Pages 49313-49318]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-20167]

[[Page 49313]]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2005-0534-201113; FRL-9449-8]

Approval and Promulgation of Implementation Plans North Carolina: 
Prevention of Significant Deterioration and Nonattainment New Source 
Review Rules

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is taking final action to approve revisions to the North 
Carolina State Implementation Plan (SIP) submitted by the State of 
North Carolina in three submittals dated November 30, 2005, March 16, 
2007, and June 20, 2008. The revisions modify North Carolina's 
Prevention of Significant Deterioration (PSD) and Nonattainment New 
Source Review (NNSR) permitting regulations in the SIP to address 
changes to the federal New Source Review (NSR) regulations, which were 
promulgated by EPA on December 31, 2002, and reconsidered with minor 
changes on November 7, 2003 (collectively, these two final actions are 
referred to as the ``2002 NSR Reform Rules''). In addition, the 
revisions address an update to the NSR regulations promulgated by EPA 
on November 29, 2005 (hereafter referred to as the Ozone Implementation 
NSR Update) relating to the implementation of the 1997 8-hour ozone 
National Ambient Air Quality Standards (NAAQS). EPA proposed to approve 
these revisions on September 9, 2008, and received adverse comments. In 
this final action, EPA is also responding to the adverse comments.

DATES: This rule will be effective September 9, 2011.

ADDRESSES: EPA has established a docket for this action under Docket 
Identification No. EPA-R04-OAR-2005-0534. All documents in the docket 
are listed on the http://www.regulations.gov Web site. Although listed 
in the index, some information may not be publicly available, i.e., 
Confidential Business Information or other information whose disclosure 
is restricted by statute. Certain other material, such as copyrighted 
material, is not placed on the Internet and will be publicly available 
only in hard copy form. Publicly available docket materials are 
available either electronically through http://www.regulations.gov or 
in hard copy at the Regulatory Development Section, Air Planning 
Branch, Air, Pesticides and Toxics Management Division, U.S. 
Environmental Protection Agency, Region 4, 61 Forsyth Street, SW., 
Atlanta, Georgia 30303-8960. EPA requests that if at all possible, you 
contact the person listed in the FOR FURTHER INFORMATION CONTACT 
section to schedule your inspection. The Regional Office's official 
hours of business are Monday through Friday, 8:30 to 4:30, excluding 
federal holidays.

FOR FURTHER INFORMATION CONTACT: For information regarding the North 
Carolina SIP, contact Ms. Twunjala Bradley, Regulatory Development 
Section, Air Planning Branch, Air, Pesticides and Toxics Management 
Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth 
Street, SW., Atlanta, Georgia 30303-8960. Ms. Bradley's telephone 
number is (404) 562-9352; e-mail address: bradley.twunjala@epa.gov. For 
information regarding NSR Reform, contact Ms. Yolanda Adams, Air 
Permits Section, at the same address above. Ms. Adam's telephone number 
is: (404) 562-9214; e-mail address: adams.yolanda@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document, references to 
``EPA,'' ``we,'' ``us,'' or ``our,'' are intended to mean the 
Environmental Protection Agency. The supplementary information is 
arranged as follows:

I. What action is EPA taking?
II. What is the background for EPA's action?
III. Response to Comments
IV. Final Action
V. Statutory and Executive Order Reviews

I. What action is EPA taking?

    EPA is taking final action to approve revisions to the North 
Carolina SIP regarding the State's NSR programs. On November 30, 2005, 
March 16, 2007, and June 20, 2008, the State of North Carolina, through 
the North Carolina Department of Environment and Natural Resources (NC 
DENR), submitted revisions to the North Carolina SIP. The SIP revisions 
consist of changes to North Carolina Air Quality Rules, Subchapter 2D. 
Specifically, the November 30, 2005, proposed SIP revision includes 
changes to Regulation 15A North Carolina Administrative Code (NCAC) 2D 
.0531, ``Sources in Nonattainment Areas.'' The March 16, 2007, proposed 
SIP revision includes changes to Regulation 15A NCAC 2D .0530, 
``Prevention of Significant Deterioration.'' The June 20, 2008, 
proposed SIP revision \1\ includes additional changes to Regulations 
15A NCAC 2D .0530, and .0531. NC DENR submitted these revisions in 
response to EPA's December 31, 2002, November 7, 2003, and November 29, 
2005, revisions to the federal NSR program. Pursuant to section 110 of 
the Clean Air Act (CAA or Act), EPA is taking final action to approve 
these SIP revisions.
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    \1\ The June 20, 2008, SIP revision also included changes to 
NCAC Subchapter 2D, Section .2400, Clean Air Interstate Rule (CAIR). 
EPA took final action approving the CAIR portion of the June 20, 
2008, SIP revision on November 30, 2009. See 74 FR 62496.
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II. What is the background for EPA's action?

    On December 31, 2002 (67 FR 80186), EPA published final rule 
changes to 40 Code of Federal Regulations (CFR) parts 51 and 52, 
regarding the CAA's PSD and NNSR programs. On November 7, 2003 (68 FR 
63021), EPA published a notice of final action on the reconsideration 
of the December 31, 2002, final rule changes. The December 31, 2002, 
and the November 7, 2003, final actions are collectively referred to as 
the ``2002 NSR Reform Rules.'' \2\ For additional information on the 
2002 NSR Reform Rules, see 67 FR 80186 (December 31, 2002). For 
information on the subsequent revisions to these rules, see http://www.epa.gov/nsr.
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    \2\ For more information on the 2002 NSR Reform Rules, and its 
supporting technical documents, see, http://www.epa.gov/nsr/actions.html#2002 (last visited February 16, 2011).
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    Also relevant to NC DENR's SIP revisions, on November 29, 2005 (70 
FR 71612), EPA promulgated implementation provisions for the 1997 8-
hour NAAQS which made changes to the NSR regulations. These included, 
among other changes, a requirement that emissions of nitrogen oxides 
(NOx) be considered a precursor to ozone. These rules are commonly 
referred to as the Ozone Implementation NSR Update.
    On November 30, 2005, March 16, 2007, and June 20, 2008, NC DENR 
submitted SIP revisions to EPA for the purpose of revising the State's 
NSR permitting provisions to adopt EPA's 2002 NSR Reform Rules and the 
Ozone Implementation NSR Update. These SIP revisions incorporate by 
reference (IBR) the federal NSR rules at 40 CFR 51.166 and 51.165, as 
amended on June 13, 2007, with several changes. See EPA's analysis of 
the State's NSR SIP revisions in the September 9, 2008, proposed 
rulemaking. See 73 FR 52226. Copies of North Carolina's revised NSR 
rules, as well as the State's Technical Support Document, can be 
obtained from the docket, as discussed in the ADDRESSES section above.
    On September 9, 2008 (73 FR 52226), EPA proposed to approve the 
above-referenced SIP revisions. In response to

[[Page 49314]]

a request for an extension of the public comment period for EPA's 
September 9, 2008, proposed rulemaking, EPA extended the public comment 
period through November 10, 2008 (73 FR 58084). EPA received adverse 
comments from the National Resource Defense Council (NRDC) and the Duke 
Energy Corporation (DEC) regarding North Carolina's NSR Reform Rule 
changes. No adverse comments were received for North Carolina's rule 
changes to adopt the provisions of the Ozone Implementation NSR Update. 
EPA's response to these comments is below in section III of this final 
rulemaking. EPA's analysis of the State's NSR SIP revisions is 
contained in the September 9, 2008, proposed rulemaking, and briefly 
summarized as follows. See 73 FR 52226.
    EPA's evaluation of the North Carolina SIP submittals included a 
line-by-line comparison of the proposed revisions with the federal 
requirements. As a general matter, state agencies may meet the 
requirements of 40 CFR part 51, and the 2002 NSR Reform Rules, with 
different but equivalent regulations. As mentioned above, North 
Carolina chose to IBR the federal rules with several changes. The 
definition of ``baseline actual emissions'' at subchapter 2D 
.0530(b)(1) and .0531(a)(1) was changed to remove the provision 
allowing emissions units that are not electric utility steam generating 
units (EUSGUs) to look back 10 years to select the baseline period. 
North Carolina rules treat EUSGUs and non-EUSGUs the same by allowing a 
look back of only 5 years. However, North Carolina rules provide the 
option of allowing a different time period, not to exceed 10 years, if 
the owner or operator demonstrates that it is more representative of 
normal source operation. In addition, North Carolina rules require 
EUSGUs to adjust downward the baseline emissions to account for 
reductions required under the North Carolina Clean Smokestack Act (CSA) 
(a state law mandating emission reductions from certain EUSGUs). North 
Carolina's rules also include some changes from the federal rules 
regarding recordkeeping and reporting; plant-wide applicability limits; 
and clarifications regarding the use of emissions reductions from the 
CSA. One such clarification is that any allowances for emissions 
reductions achieved under the CSA are not available to the subject 
facilities, nor any other sources, and may not be used to offset 
emissions and avoid installation of best available control technology 
or lowest achievable emissions rate on new natural gas-fired units. A 
full discussion of the differences between the North Carolina rules and 
the federal rules is available in the proposal action. See 73 FR 52226.

III. Response to Comments

    EPA received two sets of adverse comments on the September 9, 2008, 
proposed rulemaking to approve North Carolina's November 30, 2005, 
March 16, 2007, and June 20, 2008, SIP revisions. Specifically, adverse 
comments were received from NRDC and DEC. A complete set of these 
comments is provided in the docket for today's rulemaking. EPA's 
response to these adverse comments is provided below.

A. EPA's Response to NRDC Comments

    NRDC commented on EPA's proposed rulemaking to approve North 
Carolina's NSR rule changes. Specifically, NRDC primarily commented on 
the requirements of the federal NSR rules, not North Carolina's 
application of the federal requirements in its own rules. Notably, NRDC 
participated in litigation challenging EPA's 2002 promulgation of the 
NSR Reform Rules, where similar arguments were made by NRDC and 
dismissed by the D.C. Circuit Court. New York v. EPA, 413 F.3d 3 (DC 
Cir. 2005). NRDC's comments, including exhibits, do not raise any 
specific concerns with North Carolina's rules, but rather, reiterate 
arguments made by NRDC to the D.C. Circuit regarding sections 110(l) 
and 193 of the CAA.\3\
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    \3\ NRDC notes that, ``[t]he 2002 rule provisions considered by 
the D.C. Circuit in New York v. EPA were EPA regulations, not state 
ones. The court thus had no occasion to decide whether EPA could 
approve any state's versions of any of the 2002 rule provisions 
consistently with section 110(l) of the Act.'' NRDC Comments at 3. 
The North Carolina rules at issue here track the federally approved 
rules (upheld by the DC Circuit) (which NRDC admits--NRDC Comments 
at 4) and NRDC supported all its comments with information related 
to the challenge of EPA's 2002 NSR Reform Rules. NRDC provided no 
North Carolina-specific support for its comments.
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    While NRDC's comments provide citations to eleven portions of the 
North Carolina rules, the comments make no attempt to specifically 
explain or demonstrate how those identified provisions are inconsistent 
with either section 110(l) or section 193 of the CAA. Furthermore, NRDC 
provides no evidence supporting its allegations that approval of the 
specific provisions would result in a violation of the CAA or otherwise 
be ``arbitrary, capricious, an abuse of discretion, and otherwise not 
in accordance with law.'' NRDC Comments at 2.
    The NRDC comments include a list of 31 exhibits which the comment 
letter incorporates by reference into the comments. NRDC Comments at 1. 
The 31 exhibits appear to all be related to the DC Circuit Court case 
New York v. EPA, and were either submitted to that Court for review, or 
are relevant to that adjudication. To the extent that these exhibits 
were provided to the DC Circuit, those issues were previously resolved 
by the Court and/or already responded to by EPA in its responsive court 
papers. Any other documents included in the 31 exhibits that were not 
provided to the DC Circuit Court do not provide EPA with any comments 
specific to the North Carolina rules at issue.
    Despite the lack of North Carolina-specific discussion in NRDC's 
letter, EPA has responded to the few comments that appear related to 
the September 9, 2008, proposed rulemaking to approve North Carolina's 
SIP revision pertaining to EPA's 2002 NSR Reform Rules.\4\
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    \4\ Similar comments were filed by Sierra Club on the Wisconsin 
NSR Reform SIP revision. EPA's response to comments in that matter 
may be reviewed at http://www.regulations.gov--document ID EPA-R05-
OAR-2006-0609-0009. EPA was successful in defending a challenge to 
approval of Wisconsin's NSR Reform SIP revision. See NRDC v. 
Jackson, Nos. 09-1405 & 10-2123 (7th Cir., Jun. 16, 2011), 2011 US 
App LEXIS 12116.
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    Comment 1: In summary, NRDC stated that finalizing the EPA 
September 9, 2008, proposed rulemaking to approve North Carolina's 
November 30, 2005, March 16, 2007, and June 20, 2008, SIP revisions 
would violate section 110(l) of the Act. NRDC comments at 1-6. As 
support for its conclusion, NRDC asserted that ``[t]he 2002 NSR Reform 
Rule provisions that were not vacated by the DC Circuit in New York v. 
EPA [citation omitted] allow previously-prohibited emissions-increases 
to occur.'' NRDC comments at 4. Further, that ``North Carolina 
nevertheless has made no `demonstration that the emissions that are 
allowed by its revised rule but are prohibited by the current SIP would 
not interfere with attainment or other applicable requirements.' '' As 
a result, NRDC stated that, ``it cannot be said of North Carolina's 
plan that it `will cause no degradation of air quality.' '' NRDC 
comments at 5. NRDC also stated that EPA has not made any findings that 
North Carolina's rule will not cause degradation of air quality or 
interfere with any applicable requirements concerning attainment and 
reasonable further progress, or any other applicable requirements of 
the CAA. NRDC comments at 5.
    Response 1: EPA's 2002 NSR Reform Rules were upheld by the DC 
Circuit

[[Page 49315]]

Court which reviewed them, with the exception of the pollution control 
project and clean unit provisions (and the remanded matters). The three 
significant changes in NSR Reform that were upheld by the DC Circuit 
were: (1) Plant-wide applicability limits (PALs), (2) the 2-in-10 
baseline, and (3) the actual-to-projected actual emission test. The 
Supplemental Environmental Analysis of the Impact of the 2002 Final NSR 
Improvement Rules (November 21, 2002) (Supplemental Analysis) discussed 
each of these three changes individually, and addresses some of the 
issues raised by NRDC.
    With regard to PALs, the Supplemental Analysis explained, ``[t]he 
EPA expects that the adoption of PAL provisions will result in a net 
environmental benefit. Our experience to date is that the emissions 
caps found in PAL-type permits result in real emissions reductions, as 
well as other benefits.'' Supplemental Analysis at 6. EPA further 
explained that,

    ``Although it is impossible to predict how many and which 
sources will take PALs, and what actual reductions those sources 
will achieve for what pollutants, we believe that, on a nationwide 
basis, PALs are certain to lead to tens of thousands of tons of 
reductions of [volatile organic compounds] from source categories 
where frequent operational changes are made, where these changes are 
time-sensitive, and where there are opportunities for economical air 
pollution control measures. These reductions occur because of the 
incentives that the PAL creates to control existing and new units in 
order to provide room under the cap to make necessary operational 
changes over the life of the PAL.''

Supplemental Analysis at 7. The Supplemental Analysis, and particularly 
Appendix B, provided additional details regarding EPA's analysis of 
PALs and anticipated associated emission decreases.
    With regard to the 2-in-10 baseline, EPA concluded that, ``[t]he 
EPA believes that the environmental impact from the change in baseline 
EPA is now finalizing will not result in any significant change in 
benefits derived from the NSR program.'' Supplemental Analysis at 13. 
This is mainly because ``the number of sources receiving different 
baselines likely represents a very small fraction of the overall NSR 
permit universe, excludes new sources and coal fired power plants, and 
because the baseline may shift in either direction, we conclude that 
any overall consequences would be negligible.'' Supplemental Analysis 
at 14. Additional information regarding the 2-in-10 baseline changes is 
available in the Supplemental Analysis, Appendix F.
    With regard to the actual-to-projected actual test, EPA concluded, 
``we believe that the environmental impacts of the switch to the 
actual-to-projected actual test are likely to be environmentally 
beneficial. However, as with the change to the baseline, we believe the 
vast majority of sources, including new sources, new units, electric 
utility steam generating units, and units that actually increase 
emissions as a result of a change, will be unaffected by this change. 
Thus, the overall impacts of the NSR changes are likely to be 
environmentally beneficial, but only to a small extent.'' Supplemental 
Analysis at 14 (see also Supplemental Analysis Appendix G).
    Section 110(l) of the CAA states, in relevant part, that ``[t]he 
Administrator shall not approve a revision of a plan if the revision 
would interfere with any applicable requirement concerning attainment 
and reasonable further progress * * * or any other applicable 
requirement of this chapter.'' CAA, 42 U.S.C. 7410(l). In ``Approval 
and Promulgation of Implementation Plans; New Source Review; State of 
Nevada, Clark County Department of Air Quality and Environmental 
Management,'' 69 FR 54006 (September 7, 2004), EPA stated that section 
110(l) does not preclude SIP relaxations. Rather, EPA stated that 
section 110(l) only requires that the ``relaxations not interfere with 
specified requirements of the Act including requirements for attainment 
and reasonable further progress,'' and that, therefore, a state can 
relax its SIP provisions if it is able to show that it can attain or 
maintain the NAAQS and meet any applicable reasonable further progress 
goals or other specific requirements. See 69 FR at 54011-12.
    North Carolina's November 30, 2005, March 16, 2007, and June 20, 
2008, SIP revisions track the federal NSR Reform Rules, with changes, 
as described in North Carolina's SIP revisions. EPA evaluated North 
Carolina's rules consistent with its evaluation of the federal rules, 
and determined that North Carolina's rules were equivalent to or more 
stringent than the 2002 NSR Reform Rules. Overall, as summarized above, 
EPA expects that changes in air quality as a result of implementing 
North Carolina's rules as updated by the aforementioned SIP revisions 
is consistent with EPA's position on the federal NSR Reform Rules--that 
there will be somewhere between neutral and providing modest 
contribution to reasonable further progress between the NSR Reform and 
pre-Reform provisions. EPA's analysis for the environmental impacts of 
the three components of the NSR Reform rules (discussed earlier) is 
informative of how North Carolina's adoption of NSR Reform (based on 
the federal rules) will affect emissions. EPA has no reason to believe 
that the environmental impacts will be different from those discussed 
in the Supplemental Analysis for the NSR Reform Rules, and thus, 
approval of the November 30, 2005, March 16, 2007, and June 20, 2008, 
SIP revisions related to NSR Reform would not be contrary to section 
110(l) of the CAA.\5\
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    \5\ In reviewing EPA's approval of a Wisconsin SIP amendment 
that adopted the 2002 NSR Reform rules, a federal appeals court 
recently held that EPA could rely on the Supplemental Analysis in 
support of its approval. See NRDC v. Jackson, Nos. 09-1405 & 10-2123 
(7th Cir., Jun. 16, 2011), 2011 US App LEXIS 12116.
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    Comment 2: NRDC cites to eleven general portions of North 
Carolina's rules as provisions that would violate section 110(l). These 
provisions are: Regulation 15A North Carolina Administrative Code 
(NCAC), Subchapter 2D .0530, subsections (a), (b), (g), (i), (u), and 
(v) (from North Carolina's PSD rules); and Subchapter 2D .0531, 
subsections (a), (c), (n), (o), and (p) (from North Carolina's NNSR 
rules).
    Response 2: With regard to the comments, NRDC provides no evidence 
supporting its contention that these specific provisions violate 
section 110(l). The first provision noted by NRDC, 15A NCAC 02D 
.0530(a) states the general purpose of the rule to implement North 
Carolina's PSD program, which does include some changes per the SIP 
revisions at issue. Nonetheless, without further specificity, it is not 
clear why or how NRDC believes this provision is a violation of section 
110(l). In addition, NRDC has provided no North Carolina-specific 
documentation that indicates that EPA's analysis and conclusions 
regarding the impact of NSR Reform, in the Supplemental Analysis, is 
not applicable to North Carolina's rules, which are equivalent to or 
more stringent than the federal rules.
    In evaluating North Carolina's November 30, 2005, March 16, 2007, 
and June 20, 2008, SIP revisions, EPA compared North Carolina's rules 
with the existing federal rules and determined that North Carolina's 
rules were equivalent to or more stringent than the NSR Reform 
(federal) rules. EPA also considered North Carolina's changes to the 
federal NSR Reform provisions. These changes were discussed in EPA's 
September 9, 2008, proposed rulemaking to approve North Carolina's 
three SIP revisions related to NSR Reform, and are discussed in North 
Carolina's final submittal (including

[[Page 49316]]

North Carolina's response to comments received during the State public 
process), which are included in the docket for today's final action. As 
was explained in EPA's September 9, 2008, proposed rulemaking, EPA 
agrees with North Carolina's conclusion that the changes are at least 
equivalent to the Federal rules. See 73 FR 52228-52229. EPA also 
considered the Supplemental Analysis in reviewing North Carolinas's 
three SIP revisions related to NSR Reform, and NRDC's comments. EPA 
concluded that approval of North Carolina's SIP revisions would not be 
contrary to section 110(l) of the CAA.
    Absent more explicit information demonstrating that North 
Carolina's plan for implementation of a specific provision of its rules 
would interfere with any applicable requirement of the CAA and thus 
should be disapproved under section 110(l), EPA is concluding that 
North Carolina's Technical Support Document and the Supplemental 
Analysis supports approval. As a result, there is no basis on which to 
determine that approval of North Carolina's rules would violate section 
110(l).
    Comment 3: NRDC states that NSR is a ``control requirement'' and 
thus the requirements of section 193 apply to the NSR rules at issue in 
North Carolina's November 30, 2005, March 16, 2007, and June 20, 2008, 
SIP revisions. NRDC comments at 7. NRDC further alleges that North 
Carolina's revisions ``ensure that emissions will not be reduced as 
much as under the pre-existing rules. In fact, the modifications allow 
emissions to increase in North Carolina's nonattainment areas.'' NRDC 
comments at 9. Finally, NRDC states that ``because section 193 lies 
within part D,'' ``if EPA approves North Carolina's revised plan, that 
action will additionally exceed the agency's authority under section 
110(k)(3) and violate section 100(l).'' (Note, the last citation to 
100(l) appears to be a typographical error and should read 110(l).) 
NRDC comments at 10.
    Response 3: EPA's response to the section 193 issues raised by NRDC 
involves many of the same elements of the response above to the section 
110(l) comments, which is also incorporated by reference here. Section 
193 states (in relevant part), that ``[n]o control requirement in 
effect, or required to be adopted by an order, settlement agreement, or 
plan in effect before November 15, 1990, in any area which is a 
nonattainment area for any air pollutant may be modified after November 
15, 1990, in any manner unless the modification insures equivalent or 
greater emission reductions of such air pollutant.''
    Assuming for purposes of this discussion that section 193 does 
apply to the instant action, as was discussed earlier in this notice, 
EPA has previously determined and explained in the Supplemental 
Analysis, that implementation of the 2002 NSR Reform Rule provisions 
still in effect (that is, those not vacated by the DC Circuit) are 
expected to have at least a neutral environmental benefit. While North 
Carolina's rules do include some changes from the Federal rules, in the 
September 9, 2008, proposed rulemaking, EPA explained the basis for its 
evaluation that the differences do not make North Carolina's NSR 
program less stringent than the federal program. EPA has no information 
indicating that findings associated with EPA's Supplemental Analysis 
would not apply in North Carolina--that is, that North Carolina's SIP 
revisions would have at least a neutral environmental benefit. See 
e.g., NRDC v. Jackson, Nos. 09-1405 & 10-2123 (7th Cir., Jun. 16, 
2011), 2011 US App LEXIS 12116 (upholding EPA's reliance on the 
Supplemental Analysis where there was no information indicating an 
alternative outcome or analysis). Therefore, even if section 193 did 
apply to this action, EPA does not agree with commenter's assertions 
that the SIP revisions approved in this action raise a section 193 
concern.
    In addition, the core of NRDC's argument seems to revolve around 
the DC Circuit Court decision in South Coast Air Quality Management 
District v. EPA, 472 F.3d 882 (DC Cir. 2006) (finding that NSR 
associated with the 1-hour ozone NAAQS included control requirements). 
At issue in South Coast v.EPA was EPA's determination regarding the 
revocation of the entire 1-hour ozone program (and corresponding SIP 
elements), including all the 1-hour nonattainment NSR elements, and 
whether such elements would continue to be required as part of SIPs 
implementing the new (at that time) 8-hour ozone NAAQS. The facts in 
the South Coast v. EPA case are distinguishable from the instant matter 
where the North Carolina SIP is merely being updated to include changes 
to the Federal NSR program. EPA is not removing the entirety of North 
Carolina's NNSR program from the SIP as it pertains to a particular 
NAAQS. Rather, EPA is simply approving North Carolina's SIP revisions 
that adopt rules equivalent to or more stringent than the federal 
rules; and as discussed earlier in this notice, EPA developed a 
Supplemental Analysis to support adoption of the federal rules. The 
North Carolina SIP will continue to operate with the full suite of NSR 
related elements, including a comprehensive minor source program.

B. EPA's Response to DEC Comments

    DEC also commented on EPA's September 9, 2008, proposed rulemaking 
to approve North Carolina's NSR rule. DEC primarily commented on the 
requirements that electric utilities adjust downward the baseline 
emissions to account for reductions achieved and paid for as a result 
of the North Carolina CSA. Below summarizes DEC's comment and EPA's 
response.
    Comment 4: DEC indicated that EPA should not approve these 
provisions into North Carolina's SIP because: (1) They are not required 
by the CAA and the federal NSR regulations; (2) they have nothing to do 
with air quality concerns; and (3) the General Assembly of North 
Carolina adopted legislation which provides specific exceptions from 
the requirement to adjust baseline emissions downward based on the CSA.
    Response 4: As a point of background, on August 21, 2009, North 
Carolina provided a SIP revision to EPA requesting that EPA incorporate 
the provisions of the CSA into the SIP. The submittal was necessary to 
ensure attainment and maintenance of the NAAQS within North Carolina 
(North Carolina has relied, and continues to rely, on the CSA 
reductions to demonstrate attainment with more than one NAAQS). As part 
of redesignation submittals for at least two areas in North Carolina, 
for the 1997 annual PM2.5 NAAQS, North Carolina is relying 
on the CSA as containing ``permanent and enforceable'' measures that 
ensure maintenance for that NAAQS. That reliance necessitated that 
North Carolina submit to EPA the CSA for approval into the SIP. On June 
22, 2011, EPA proposed to approve the CSA into the North Carolina SIP. 
See 76 FR 36468.
    As was explained in the proposal action, North Carolina's rules 
include a requirement that EUSGUs adjust downward the baseline 
emissions to account for reductions required under the North Carolina 
Clean Smokestack Act. DEC's comments appear to suggest that because the 
CSA reductions are not required, this provision should not be approved 
into the SIP. Further, that the North Carolina legislature took action 
to eliminate this provision for at least a certain period of time. 
Consistent with the background information provided above, because 
North Carolina is in fact relying on the CSA reductions for attainment 
and maintenance of NAAQS for various areas around North Carolina, the 
provision is actually necessary to

[[Page 49317]]

ensure that the reductions remain permanent and enforceable. While 
there remains some flexibility in how those reductions are achieved per 
the CSA, once achieved, they must be permanent.
    With regard to the action taken by the legislature on July 17, 2006 
(the text of which DEC included as part of its comments), the language 
itself in Senate Bill 1587 only applies between April 21, 2005, and 
August 1, 2006. Because that time period has lapsed, there is nothing 
apparent in Senate Bill 1587 that could impact approval of the SIP 
revisions currently being approved today. The comment letter does not 
explain why a provision that lapsed on August 1, 2006, would apply to 
today's rulemaking and PSD applicability going forward from the 
effective date of today's rule. As a general matter, EPA does not 
necessarily agree with DEC's legal arguments; however, given that 
Senate Bill 1587 does not apply currently, these differences need not 
be resolved at this time. The NSR reform rules being approved today 
would apply to the facilities at issue under the CSA once today's 
action is final and effective, per the provisions of the State rules 
now being incorporated into the SIP.

IV. Final Action

    EPA is taking final action to approve revisions to the North 
Carolina SIP for Regulations 15A NCAC 2D .0530 and .0531, as submitted 
by the NC DENR on November 30, 2005, March 16, 2007, and June 20, 2008. 
These SIP revisions address changes to North Carolina's PSD and NNSR 
programs. EPA is approving these revisions into the North Carolina SIP 
because they are consistent with section 110 of the CAA and its 
implementing regulations.

V. 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, EPA's role is to approve state choices, 
provided that they meet the criteria of the CAA. Accordingly, this 
action merely approves state law as meeting Federal requirements and 
does not impose additional requirements beyond those imposed by state 
law. For that reason, this action:
     Is not a ``significant regulatory action'' subject to 
review by the Office of Management and Budget under Executive Order 
12866 (58 FR 51735, October 4, 1993);
     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 CAA; and
     Does 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).
    In addition, this rule does not have tribal implications as 
specified by Executive Order 13175 (65 FR 67249, November 9, 2000), 
because the SIP is not approved to apply in Indian country located in 
the state, and EPA notes that it will not impose substantial direct 
costs on tribal governments or preempt tribal law.
    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. EPA will submit a report containing this action and 
other required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2).
    Under section 307(b)(1) of the CAA, petitions for judicial review 
of this action must be filed in the United States Court of Appeals for 
the appropriate circuit by October 11, 2011. Filing a petition for 
reconsideration by the Administrator of this final rule does not affect 
the finality of this action for the purposes of judicial review nor 
does it extend the time within which a petition for judicial review may 
be filed, and shall not postpone the effectiveness of such rule or 
action. This action may not be challenged later in proceedings to 
enforce its requirements. See section 307(b)(2).

List of Subjects in 40 CFR Part 52

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

    Dated: July 25, 2011.
A. Stanley Meiburg,
Acting Regional Administrator, Region 4.
    40 CFR part 52 is amended as follows:

PART 52--[AMENDED]

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

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

Subpart II--North Carolina

0
2. Section 52.1770(c), Table 1, is amended under Subchapter 2D, Section 
.0500, by revising the entries for ``Sect .0530'' and ``Sect .0531'' to 
read as follows:

Sec.  52.1770   Identification of plan.

* * * * *
    (c) * * *

[[Page 49318]]

                                Table 1--EPA-Approved North Carolina Regulations
----------------------------------------------------------------------------------------------------------------
                                                            State
          State citation               Title/subject      effective     EPA approval date        Explanation
                                                             date
----------------------------------------------------------------------------------------------------------------
                                Subchapter 2D Air Pollution Control Requirements
----------------------------------------------------------------------------------------------------------------
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                    Section .0500 Emission Control Standards
----------------------------------------------------------------------------------------------------------------
                                                  * * * * * * *
Sect .0530.......................  Prevention of            5/1/2008  8/10/2011 [Insert     15 NCAC .0530
                                    Significant                        citation of           incorporates by
                                    Deterioration.                     publication].         reference the
                                                                                             regulations found
                                                                                             at 40 CFR 51.166,
                                                                                             with changes, as of
                                                                                             June 13, 2007. This
                                                                                             EPA action is
                                                                                             approving the
                                                                                             incorporation by
                                                                                             reference with the
                                                                                             exception of the
                                                                                             phrase ``except
                                                                                             ethanol production
                                                                                             facilities
                                                                                             producing ethanol
                                                                                             by natural
                                                                                             fermentation under
                                                                                             the North American
                                                                                             Industry
                                                                                             Classification
                                                                                             System (NAICS)
                                                                                             codes 325193 or
                                                                                             312140,'' (as
                                                                                             amended at 40 CFR
                                                                                             51.166(b)(1)(i)(a),
                                                                                             (b)(1)(iii)(t), and
                                                                                             (i)(1)(ii)(t).
Sect .0531.......................  Sources in               5/1/2008  8/10/2011 [Insert     15 NCAC .0531
                                    Nonattainment Areas.               citation of           incorporates by
                                                                       publication].         reference the
                                                                                             regulations found
                                                                                             at 40 CFR 51.165,
                                                                                             with changes, as of
                                                                                             June 13, 2007. This
                                                                                             EPA action is
                                                                                             approving the
                                                                                             incorporation by
                                                                                             reference with the
                                                                                             exception of the
                                                                                             phrase ``except
                                                                                             ethanol production
                                                                                             facilities
                                                                                             producing ethanol
                                                                                             by natural
                                                                                             fermentation under
                                                                                             the North American
                                                                                             Industry
                                                                                             Classification
                                                                                             System (NAICS)
                                                                                             codes 325193 or
                                                                                             312140,'' (as
                                                                                             amended at 40 CFR
                                                                                             51.165(a)(1)(iv)(C)
                                                                                             (20) and
                                                                                             (a)(4)(xx).
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

* * * * *
[FR Doc. 2011-20167 Filed 8-9-11; 8:45 am]
BILLING CODE 6560-50-P