Document ID: EPA-R08-OAR-2014-0049-0001
Agency: epa
Document Type: Proposed Rule
Title: Air Quality State Implementation Plans; Approvals and Promulgations: South Dakota; Prevention of Significant Deterioration; Greenhouse Gas Tailoring Rule Revisions
Posted Date: 2014-02-11T05:00Z

[Federal Register Volume 79, Number 28 (Tuesday, February 11, 2014)]
[Proposed Rules]
[Pages 8130-8133]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-02931]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R08-OAR-2014-0049; FRL-9906-42-Region-8]

Approval and Promulgation of Air Quality Implementation Plans; 
South Dakota; Prevention of Significant Deterioration; Greenhouse Gas 
Tailoring Rule Revisions

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to 
partially approve and partially disapprove revisions to the South 
Dakota State Implementation Plan (SIP) submitted by the South Dakota 
Department of Environment and Natural Resources (DENR) to EPA on June 
20, 2011. The proposed SIP revisions address the permitting of sources 
of greenhouse gases (GHGs). Specifically, we propose to approve 
revisions to the State's Prevention of Significant Deterioration (PSD) 
program to incorporate the provisions of the federal PSD and Title V 
Greenhouse Gas Tailoring Rule (Tailoring Rule). The proposed SIP 
revisions incorporate by reference the federal Tailoring Rule's 
emission thresholds for determining which new stationary sources and 
modifications to existing stationary sources become subject to South 
Dakota's PSD permitting requirements for their GHG emissions. EPA is 
proposing to disapprove a related provision that would rescind the 
State's Tailoring Rule revision in certain circumstances. EPA will take 
separate action on an amendment to the chapter Construction Permits for 
New Sources or Modifications in the June 20, 2011 submittal, regarding 
permits for minor sources. EPA is proposing this action under section 
110 and part C of the Clean Air Act (the Act or CAA).

DATES: Comments must be received on or before March 13, 2014.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R08-
OAR-2014-0049, by one of the following methods:
     Federal Rulemaking Portal: http://www.regulations.gov. 
Follow the online instructions for submitting comments.
     Email: ostendorf.jody@epa.gov.
     Fax: (303) 312-6064 (please alert the individual listed in 
the FOR FURTHER INFORMATION CONTACT if you are faxing comments).
     Mail: Carl Daly, Director, Air Program, Environmental 
Protection Agency (EPA), Region 8, Mailcode 8P-AR, 1595 Wynkoop St., 
Denver, Colorado 80202-1129.
     Hand Delivery: Carl Daly, Director, Air Program, 
Environmental Protection Agency (EPA), Region 8, Mailcode 8P-AR, 1595 
Wynkoop St., Denver, Colorado 80202-1129. Such deliveries are only 
accepted Monday through Friday, 8:00 a.m. to 4:30 p.m., excluding 
Federal holidays. Special arrangements should be made for deliveries of 
boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-R08-OAR-
2014-0049. EPA's policy is that all comments received will be included 
in the public docket without change and may be made available online at 
http://www.regulations.gov, including any personal information 
provided, unless the comment includes information claimed to be 
Confidential Business Information (CBI) or other information the 
disclosure of which is restricted by statute. Do not submit information 
through http://www.regulations.gov or email, if you believe that it is 
CBI or otherwise protected from disclosure. The http://www.regulations.gov Web site is an ``anonymous access'' system, which 
means that EPA will not know

[[Page 8131]]

your identity or contact information unless you provide it in the body 
of your comment. If you send an email comment directly to EPA without 
going through http://www.regulations.gov, your email address will be 
automatically captured and included as part of the comment that is 
placed in the public docket and made available on the Internet. If you 
submit an electronic comment, EPA recommends that you include your name 
and other contact information in the body of your comment along with 
any disk or CD-ROM submitted. If EPA cannot read your comment due to 
technical difficulties and cannot contact you for clarification, EPA 
may not be able to consider your comment. Electronic files should avoid 
the use of special characters and any form of encryption and should be 
free of any defects or viruses. For additional information about EPA's 
public docket, visit the EPA Docket Center homepage at http://www.epa.gov/epahome/dockets.htm.
    Docket: All documents in the docket are listed in the 
www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hard copy. 
Publicly available docket materials are available either electronically 
in www.regulations.gov or in hard copy at the Air Program, 
Environmental Protection Agency (EPA), Region 8, 1595 Wynkoop St., 
Denver, Colorado 80202-1129. EPA requests that if at all possible, you 
contact the individual listed in the FOR FURTHER INFORMATION CONTACT 
section to view the hard copy of the docket. You may view the hard copy 
of the docket Monday through Friday, 8:00 a.m. to 4:00 p.m., excluding 
Federal holidays.

FOR FURTHER INFORMATION CONTACT: Jody Ostendorf, Air Program, Mailcode 
8P-AR, Environmental Protection Agency (EPA), Region 8, 1595 Wynkoop 
St., Denver, Colorado 80202-1129, (303) 312-7814, 
ostendorf.jody@epa.gov.

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

Table of Contents

I. Background for Our Proposed Action
II. History of EPA's GHG-Related Actions
III. EPA's Analysis of the State's Submittal
IV. Proposed Action
V. Statutory and Executive Orders Review

I. Background for Our Proposed Action

    CAA section 110(a)(2)(C) requires states to develop and submit to 
EPA for approval into the state SIP preconstruction review and 
permitting programs applicable to certain new and modified stationary 
sources of air pollutants. There are three separate new source review 
(NSR) programs: PSD, Nonattainment New Source Review (NNSR), and Minor 
NSR. The PSD program is established in part C of title I of the CAA and 
applies in areas that meet the National Ambient Air Quality Standards 
(NAAQS)--``attainment areas''--as well as areas where there is 
insufficient information to determine if the area meets the NAAQS--
``unclassifiable areas.'' The NNSR program is established in part D of 
title I of the CAA and applies in areas that are not in attainment of 
the NAAQS--``nonattainment areas.'' The Minor NSR program (1) addresses 
construction or modification activities that do not emit, or have the 
potential to emit, beyond certain major source thresholds and thus do 
not qualify as ``major,'' and (2) applies regardless of the designation 
of the area in which a source is located. EPA regulations governing the 
criteria that states must satisfy for EPA approval of the NSR programs 
as part of the SIP are contained in 40 CFR sections 51.160-51.166.
    On June 20, 2011, South Dakota submitted revisions for approval by 
EPA into the South Dakota SIP, including some regulations specific to 
the South Dakota PSD permitting program. The submittal proposes to 
revise the PSD major source definition so that it applies to any air 
pollutant ``subject to regulation as required by EPA'' (Section 
74:36:01:08(2)). The submittal also proposes to add the six GHGs 
designated by EPA as regulated air pollutants to the definition of 
regulated air pollutant (Section 74:36:01:15(6)). These definitions may 
also be applied to permitting synthetic minor GHG sources, therefore, 
we are proposing to approve both of those changes in South Dakota's air 
program Definitions. Outside of the PSD program, the SIP submittal 
proposes in Section 74:36:01:01, Definitions, to add ``(73) ``Subject 
to regulation'' as defined in 40 CFR Section 70.2 (July 1, 2009), as 
revised in publication 75 FR 31607 (June 3, 2010), in accordance with 
EPA requirements.'' We are not taking action on that part of the 
submittal because it applies to the title V operating permit program 
which is not part of the SIP.
    The State generally implements the PSD program by incorporating by 
reference (with certain modifications) the federal PSD program in 40 
CFR 52.21. (See Chapter 74:36:09:02, Prevention of Significant 
Deterioration). The submittal revises the State's PSD program by 
incorporating by reference revisions to 40 CFR 52.21 promulgated by EPA 
in the ``Prevention of Significant Deterioration and Title V Greenhouse 
Gas Tailoring Rule,'' 75 FR 31514 (June 3, 2010). Specifically, the 
revision cites the regulatory changes on pages 31606 and 31607 in the 
Tailoring Rule, which contain (among other things) the revisions to 40 
CFR 52.21 promulgated in the Tailoring Rule. We propose to approve that 
revision.
    The PSD section of the State rule includes a rescission clause that 
states, ``If EPA stays or withdraws the regulation of greenhouse gases 
as identified in publication 75 FR 31606 and 31607 (June 3, 2010), or a 
court issues an order vacating or otherwise invalidating EPA's 
regulation of greenhouse gases for any reason, the regulation of 
greenhouse gases by Article 74:36 are void as of the date of such 
administrative or judicial action and shall have no further force and 
effect.'' (Section 74:36:09:02(8)). As explained below, EPA proposes to 
disapprove this language as inconsistent with the CAA.
    These proposed revisions 1) establish that GHG is a regulated 
pollutant under South Dakota's PSD program, and 2) establish emission 
thresholds for determining which new stationary sources and 
modification projects become subject to South Dakota's PSD permitting 
requirements for their GHG emissions consistent with the Tailoring 
Rule. Today's proposed action presents our rationale for approving 
these regulations as meeting the minimum federal requirements for the 
adoption and implementation of PSD SIP permitting programs, and for 
disapproving the submitted rescission clause language.

II. History of EPA's GHG-Related Actions

    This section briefly summarizes EPA's recent GHG-related actions 
that provide the background for this action. Please see the preambles 
for the identified GHG-related rulemakings for more information.
    Beginning in 2010, EPA undertook a series of actions pertaining to 
the regulation of GHGs that established the overall framework for 
today's proposed action on the South Dakota SIP. These actions include, 
as they are commonly called, the ``Endangerment Finding'' and ``Cause 
or Contribute Finding,'' which EPA issued in a single final

[[Page 8132]]

action,\1\ the ``Johnson Memo Reconsideration,'' \2\ the ``Light-Duty 
Vehicle Rule,'' \3\ and the ``Tailoring Rule.'' \4\ Taken together and 
in conjunction with the CAA, these actions established regulatory 
requirements for GHGs emitted from new motor vehicles and new motor 
vehicle engines; determined that such regulations, when they took 
effect on January 2, 2011, subjected GHGs emitted from stationary 
sources to PSD requirements; and limited the applicability of PSD 
requirements to GHG sources on a phased-in basis. EPA took this last 
action in the Tailoring Rule, which, more specifically, established 
appropriate GHG emission thresholds for determining the applicability 
of PSD requirements to GHG-emitting sources.
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    \1\ ``Endangerment and Cause or Contribute Findings for 
Greenhouse Gases Under Section 202(a) of the Clean Air Act.'' 74 FR 
66496 (December 15, 2009).
    \2\ ``Interpretation of Regulations that Determine Pollutants 
Covered by Clean Air Act Permitting Programs.'' 75 FR 17004 (April 
2, 2010).
    \3\ ``Light-Duty Vehicle Greenhouse Gas Emission Standards and 
Corporate Average Fuel Economy Standards; Final Rule.'' 75 FR 25324 
(May 7, 2010).
    \4\ ``Prevention of Significant Deterioration and Title V 
Greenhouse Gas Tailoring Rule; Final Rule.'' 75 FR 31514 (June 3, 
2010).
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    At the same time, EPA recognized that many states had approved SIP 
PSD programs that do apply PSD to GHGs, but that do so for sources that 
emit as little as 100 or 250 tons per year (tpy) of GHG, and that do 
not limit PSD applicability to GHGs to the higher thresholds in the 
Tailoring Rule. Therefore, EPA issued the GHG PSD SIP Narrowing 
Rule,\5\ under which, EPA converted its previous full approval of the 
affected SIPs, including South Dakota's, to a partial approval and 
partial disapproval, to the extent those SIPs covered GHG-emitting 
sources below the Tailoring Rule thresholds. EPA based its action 
primarily on the ``error correction'' provisions of CAA section 
110(k)(6). Many of those states have since submitted SIP revisions that 
have established the Tailoring Rule thresholds, and EPA has approved 
those SIP revisions and rescinded the partial disapprovals.
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    \5\ ``Limitation of Approval of Prevention of Significant 
Deterioration Provisions Concerning Greenhouse Gas Emitting Sources 
in State Implementation Plans,'' 75 FR 82536 (December 30, 2010).
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III. EPA's Analysis of the State's Submittal

    South Dakota is currently a SIP-approved state for the PSD program, 
and has incorporated EPA's 2002 NSR reform revisions for PSD into its 
SIP. The June 20, 2011 revisions to South Dakota's SIP will make the 
approved PSD program rules consistent with the GHG PSD SIP Narrowing 
Rule. As described above, in the Narrowing Rule EPA withdrew its 
previous approval of the South Dakota PSD program to the extent that it 
applied to permitting of new or modified major sources below the 
thresholds set out in the Tailoring Rule. By approving the changes in 
the June 20, 2011 submittal, the approved PSD program rules will 
explicitly conform with the SIP as approved under the Narrowing Rule. 
Specifically, the June 20, 2011 revisions establish thresholds 
consistent with the Tailoring Rule and Narrowing Rule for determining 
which stationary sources and modification projects become subject to 
permitting requirements for GHG emissions under South Dakota's NSR PSD 
program.
    South Dakota has adopted and submitted regulations that adopt the 
federal requirements for the permitting of GHG-emitting sources subject 
to PSD. The proposed revisions incorporate the Tailoring Rule into 
South Dakota's PSD Permitting Program, and support synthetic minor 
permitting at stationary sources seeking federally enforceable limits 
to avoid major source or major stationary source applicability 
thresholds specific to GHG. The changes revise the definitions of major 
source and regulated air pollutant, and make the Tailoring Rule 
effective January 2, 2011. The submittal makes no other changes to the 
State's approved PSD program. We propose to conclude that the revisions 
are consistent with the requirements of 40 CFR 51.166, in particular, 
requirements set out in EPA's final GHG Tailoring Rule, and that the 
revisions should be approved into South Dakota's SIP.
    However, EPA proposes to disapprove the portion of the revision 
that adds a rescission clause to the SIP. In assessing the 
approvability of this clause, EPA considered two key factors: (1) 
Whether the public will be given reasonable notice of any change to the 
SIP that occurs as a result of the automatic rescission clause, and (2) 
whether any future change to the SIP that occurs as a result of the 
automatic rescission clause would be consistent with EPA's 
interpretation of the effect of the triggering EPA or federal court 
action (e.g., the extent of an administrative or judicial stay). These 
criteria are derived from the SIP revision procedures set forth in the 
CAA and federal regulations.
    EPA's consideration of whether any SIP change resulting from the 
proposed automatic rescission clause would be consistent with EPA's 
interpretation of the effect of the triggering action on federal 
regulations is based on 40 CFR 51.105. Under 40 CFR 51.105, 
``[r]evisions of a plan, or any portion thereof, will not be considered 
part of an applicable plan until such revisions have been approved by 
the Administrator in accordance with this part.'' See 40 CFR 51.105. 
However, the South Dakota rescission clause takes effect immediately 
upon certain judicial actions without any EPA intervention. The effect 
of this is that EPA is not given the opportunity to determine the 
effect and extent of the judicial action; instead, the SIP is modified 
without EPA's approval. This violates 40 CFR 51.105.
    The provision is also insufficient with regard to providing 
adequate notice to the public. While the State followed applicable 
notice-and-comment procedures prior to adopting the automatic 
rescission clause, the public would not receive adequate notice of the 
modification of the SIP after a triggering judicial action. Without 
intervening notice by EPA to the public of the effect and extent of the 
judicial action, its effect and extent (and indeed whether the judicial 
action triggered the provision at all) would be unclear to the public.

IV. Proposed Action

    EPA proposes to approve in part, and disapprove in part, the June 
20, 2011 submittal that addresses the permitting of sources of 
greenhouse gases for incorporation into the South Dakota SIP. 
Specifically, EPA proposes to approve revisions to Chapter 74:36:09 
that incorporates the Tailoring Rule into the State's definitions and 
requirements for PSD. EPA is proposing to disapprove the provision that 
would rescind the State's Tailoring Rule revision in certain 
circumstances. EPA will take separate action on an amendment in the 
June 20, 2011 submittal to Chapter 74:36:20, Construction Permits for 
New Sources or Modifications, regarding permits for minor sources.
    EPA proposes to approve changes to Definitions, Section 
74:36:01:08(2), which revises the major source definition so that it 
applies to any air pollutant ``subject to regulation as required by 
EPA,'' and Section 74:36:01:15(6), which adds the six GHGs designated 
by EPA as regulated air pollutants to the definition of regulated air 
pollutant. EPA is not taking action on the addition of ``(73) ``Subject 
to regulation'' as defined in 40 CFR Section 70.2 (July 1, 2009), as 
revised in publication 75 FR 31607 (June 3, 2010), in accordance with 
EPA requirements,'' because it applies to the title V

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permitting program which is not part of the SIP.

V. Statutory and Executive Orders Review

    Under the Clean Air Act, 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 Clean Air Act. 
Accordingly, this proposed action merely approves state law that meets 
federal requirements and disapproves state law that does not meet 
federal requirements; when finalized, this action would 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 Clean Air Act; 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.

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, and Volatile organic compounds.

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

    Dated: January 29, 2014.
Shaun L. McGrath,
Regional Administrator, Region 8.
[FR Doc. 2014-02931 Filed 2-10-14; 8:45 am]
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