Document ID: EPA-R04-OAR-2017-0371-0010
Agency: epa
Document Type: Proposed Rule
Title: Air Quality State Implementation Plans; Approvals and Promulgations: Alabama: PSD Replacement Units
Posted Date: 2019-03-29T04:00Z

[Federal Register Volume 84, Number 61 (Friday, March 29, 2019)]
[Proposed Rules]
[Pages 11914-11917]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-06108]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2017-0371; FRL-9991-47-Region 4]

Air Plan Approval; Alabama: PSD Replacement Units

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 Alabama State Implementation Plan (SIP), 
submitted by the State of Alabama, through the Alabama Department of 
Environmental Management (ADEM), via two letters dated May 7, 2012, and 
August 27, 2018. The proposed SIP revisions relate to the State's 
Prevention of Significant Deterioration (PSD) permitting regulations. 
In particular, the revisions add a definition of ``replacement unit'' 
and provide that a replacement unit is a type of existing emissions 
unit under the definition of ``emissions unit.'' This action is being 
taken pursuant to the Clean Air Act (CAA or Act).

DATES: Comments must be received on or before April 29, 2019.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R04-
OAR-2017-0371 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, 
Pesticides

[[Page 11915]]

and Toxics Management Division, U.S. Environmental Protection Agency, 
Region 4, 61 Forsyth Street SW, Atlanta, Georgia 30303-8960. Mr. Febres 
can be reached via telephone at (404) 562-8966, or via electronic mail 
at [email protected].

SUPPLEMENTARY INFORMATION: 

I. What action is EPA taking?

    EPA is proposing to approve changes to the Alabama SIP that were 
provided to EPA through two letters dated May 7, 2012, and August 27, 
2018.\1\ Specifically, EPA is proposing to approve two SIP revisions 
that include changes to Alabama's PSD permitting regulations as part of 
the State's New Source Review (NSR) permitting program, found in ADEM 
Administrative Code Rule 335-3-14-.04--Air Permits Authorizing 
Construction in Clean Air Areas [Prevention of Significant 
Deterioration Permitting (PSD)].\2\
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    \1\ EPA notes that the Agency received the SIP revisions on May 
16, 2012 and September 4, 2018.
    \2\ EPA's regulations governing the implementation of the NSR 
permitting programs are contained in 40 CFR 51.160 through 51.166; 
52.21, 52.24; and part 51, Appendix S. The CAA NSR program is 
composed of three separate programs: PSD, nonattainment new source 
review (NNSR), and Minor NSR. PSD is established in part C of title 
I of the CAA and applies in areas that meet the 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 addresses 
construction or modification activities that do not qualify as 
``major'' and applies regardless of the designation of the area in 
which a source is located. Together, these programs are referred to 
as the NSR programs.
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    Alabama's May 7, 2012, SIP revision changes the PSD regulations at 
Rule 335-3-14-.04 by adding a definition of ``replacement unit'' and by 
modifying the definition of ``emissions unit'' to expressly include 
replacement units as existing emissions units. Portions of this 
submittal were later withdrawn through a May 5, 2017, letter, discussed 
in Section III below. Alabama's August 27, 2018, SIP revision makes 
further changes to ADEM's PSD regulations by adding a fifth condition 
to the new definition of a ``Replacement Unit'' added in the May 7, 
2012, SIP revision.\3\
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    \3\ EPA is not taking action on the portions of Alabama's May 7, 
2012, and August 27, 2018, submittals regarding ADEM Administrative 
Code Chapter 335-3-10--Standards of Performance for New Stationary 
Sources, and Chapter 335-3-11--National Emission Standards for 
Hazardous Air Pollutants. In the cover letter for these SIP 
revisions, Alabama acknowledges that these regulations are not part 
of Alabama's SIP and states that these regulations are not to be 
incorporated into the SIP.
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II. Background

    As mentioned in Section I above, on May 7, 2012, Alabama submitted 
several changes to Rule 335-3-14-.04, with some changes withdrawn 
through a May 5, 2017, withdrawal letter. On August 24, 2017 (82 FR 
40072 and 82 FR 40085), EPA published a direct final rule, together 
with a simultaneous proposal, to approve these changes into the Alabama 
SIP. Due to the receipt of adverse comments, EPA withdrew the direct 
final rule on October 12, 2017 (82 FR 47397) and is not taking final 
action on the August 24, 2017, proposed rule.\4\
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    \4\ In a direct final rule, EPA approves changes to a state's 
implementation plan without prior proposal because the Agency views 
the changes as noncontroversial and anticipates no adverse comments. 
However, in the proposed rule section of the Federal Register 
publication, EPA simultaneously publishes a separate document that 
serves as the proposed approval for the direct final rule. In the 
direct final rule, the Agency states that the rule will be effective 
60 days from the date of publication unless adverse comments are 
received within 30 days of publication. If such comments are 
received, EPA would publish a document withdrawing the direct final 
rule, while keeping the proposed rule in place, and would inform the 
public that the rule will not take effect. The Agency could then 
address all adverse comments in a subsequent final rule, based on 
the proposed rule. Alternatively, the Agency could issue a re-
proposal, which is the approach taken in this proposed rulemaking.
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    Rather, through this proposed rulemaking, EPA is re-proposing 
action on the changes to Rule 334-3-14-.04, as provided in Alabama's 
May 7, 2012, SIP revision (with the exception of portions withdrawn by 
the State through the May 5, 2017, withdrawal letter), together with 
the additional changes provided in Alabama's August 27, 2018, SIP 
revision.\5\ The following paragraphs contain background information 
related to the action being proposed. Section III contains EPA's 
analysis of the state submittals, as well as the rationale for 
proposing to approve the changes previously mentioned.
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    \5\ Because this rulemaking is re-proposing approval of the 
changes, EPA is not responding to the comments received on the 
August 24, 2017, direct final rule and proposed rulemaking actions. 
With this new proposed rulemaking, EPA is establishing a new 30-day 
comment period and will respond to any comments received during that 
time.
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A. NSR Reform

    On December 31, 2002 (67 FR 80186) (hereinafter referred to as the 
2002 NSR Rule), EPA published final rule revisions to the CAA's PSD and 
NNSR programs. The revisions included several major changes to the NSR 
program, including the addition of an actual-to-projected-actual 
emissions test for determining NSR applicability for existing emissions 
units.
    Following publication, EPA received numerous petitions requesting 
reconsideration of several aspects of the final rule. On July 30, 2003 
(68 FR 44624), EPA granted reconsideration on six issues, including 
whether replacement units should be allowed to use the actual-to-
projected-actual applicability test to determine whether installing a 
replacement unit results in a significant emissions increase. On 
November 7, 2003 (68 FR 63021), EPA published a rule titled 
``Prevention of Significant Deterioration (PSD) and Non-Attainment New 
Source Review (NSR): Reconsideration.'' See 68 FR 63021 (November 7, 
2003) (hereinafter referred to as the NSR Reform Reconsideration Rule). 
In the Reconsideration Rule, EPA continued to allow the owner or 
operator of a major stationary source to use the actual-to-projected-
actual applicability test to determine whether installing a replacement 
unit results in a significant emissions increase. Concurrently, EPA 
also modified the rules by: (1) Adding a definition of ``replacement 
unit,'' and (2) revising the definition of ``emissions unit'' to 
clarify that a replacement unit is considered an existing emissions 
unit and therefore is eligible for the actual-to-projected-actual test 
for major NSR applicability determinations. The 2002 NSR Rule and the 
NSR Reform Reconsideration Rule are hereinafter collectively referred 
to as the ``2002 NSR Reform Rules,'' and are codified at 40 CFR 51.165, 
51.166, and 52.21.

B. 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 
provided a list of equipment replacement activities that are exempt 
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

[[Page 11916]]

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).\6\ 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.\7\
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    \6\ 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.
    \7\ New York v. EPA, 443 F.3d 880 (D.C. Cir. 2006)
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III. Analysis of State's Submittal

    Alabama's May 7, 2012, SIP revision makes changes to the State's 
PSD permitting regulations by adding a definition of ``replacement 
unit'' at Rule 335-3-14-.04(2)(bbb) and by modifying the definition of 
``emissions unit'' at Rule 335-3-14-.04(2)(g) to expressly include 
replacement units as existing emissions units. These changes were 
intended to reflect revisions to the Federal regulations regarding 
replacement units included in the NSR Reform Reconsideration Rule and 
to reflect revisions regarding functionally equivalent components in 
the ERP Rule, as described in Sections II.A and II.B of this action, 
above.
    The SIP revision initially sought to add a definition of 
``replacement unit'' at Rule 335-3-14-.04(2)(bbb) that combined the 
Federal definition of ``replacement unit'' with language concerning 
functionally equivalent units and basic design parameters from the ERP 
Rule, but the language from the ERP Rule was vacated.\8\ Accordingly, 
on May 5, 2017, Alabama submitted a letter to EPA withdrawing the 
portions of the definition of ``replacement unit'' from Rule 335-3-
14-.04(2)(bbb), which corresponded to the vacated language of the ERP 
Rule.
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    \8\ As mentioned in Section II of this rulemaking, the ERP rule 
was vacated by the D.C. Circuit on March 17, 2006. However, the ERP 
rule was previously stayed indefinitely, on December 24, 2003. EPA 
has not taken action to remove the language of the ERP rule from the 
federal NSR regulations (including language found at 40 CFR 51.165, 
51.166, and 52.21), but a note remains stating that the language is 
stayed indefinitely, and that the stayed provisions will become 
effective immediately if the court terminates the stay.
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    Alabama withdrew all language related to the ERP Rule, with the 
exception of one sentence in subparagraph (bbb)(3) that provides an 
example of what should be considered a ``basic design parameter'' as it 
relates to a replacement unit. EPA has evaluated the sentence, which 
states that ``basic design parameters of a replaced unit shall also 
include all source specific emission limits and/or monitoring 
requirements.'' The Agency believes that this language is simply an 
illustrative example of what shall be considered and that it does not 
change how Alabama's PSD regulations operate. Alabama's provisions 
relating to RMRR remain consistent with Federal provisions and the CAA 
regarding RMRR and therefore remain as stringent as the Federal PSD 
regulations under 40 CFR 51.166.
    Additionally, on August 27, 2018, Alabama submitted a supplemental 
SIP revision that further modifies the definition of ``replacement 
unit'' proposed for adoption in the May 7, 2012, SIP revision, by 
adding a fifth condition under subparagraph (bbb)(5). The additional 
fifth condition requires replacement units, as defined under Rule 335-
3-14-.04(2)(bbb), to use the ``Actual-to-projected actual'' test for 
determining PSD applicability under subparagraph (1)(f) of the same 
rule. New rule 335-3-14-.04(2)(bbb) would read as follows:
    (bbb) Replacement unit means an emissions unit for which all the 
criteria listed in subparagraphs (2)(bbb)1. through 4. of this section 
are met. No creditable emission reductions shall be generated from 
shutting down the existing emissions unit that is replaced. A 
replacement unit is subject to all permitting requirements for 
modifications under this rule.
    1. The emissions unit is a reconstructed unit within the meaning of 
40 CFR 60.15(b)(1), or the emissions unit completely takes the place of 
an existing emissions unit.
    2. The emissions unit is identical to or functionally equivalent to 
the replaced emissions unit.
    3. The replacement does not alter the basic design parameters of 
the process unit. Basic design parameters of a replaced unit shall also 
include all source specific emission limits and/or monitoring 
requirements.
    4. The replaced emissions unit is permanently removed from the 
major stationary source, otherwise permanently disabled, or permanently 
barred from operation by a permit that is enforceable as a practical 
matter. If the replaced emissions unit is brought back into operation, 
it shall constitute a new emissions unit.
    5. A Replacement Unit as defined in this subparagraph shall be 
subject to the applicability test in subparagraph (1)(f) of this rule 
for any modification.
    The adoption of Rule 335-3-14-.04(2)(bbb), is meant to adopt into 
Alabama's PSD regulations, provisions regarding replacement units that 
are part of the Federal PSD regulations. These provisions were put in 
place by the NSR Reform Reconsideration Rule and are part of the RMRR 
provisions. Although the RMRR provisions related to replacement units 
were modified by the ERP Rule, these amendments were vacated by the 
D.C. Court, and Alabama appropriately withdrew these vacated elements. 
By adopting rule 335-3-14-.04(2)(bbb), as shown above, Alabama's PSD 
regulations would be consistent with Federal provisions and the CAA 
regarding RMRR.
    In addition to adopting Rule 335-3-14-.04(2)(bbb) as presented 
above which excludes the portions withdrawn by the state and includes 
the addition of subparagraph (bbb)5, the May 7, 2012, SIP revision 
includes changes to Rule 335-3-14-.04(2)(g). Specifically, Alabama 
revises the definition of ``Emissions Unit'' in 335-3-14-.04(2)(g) by 
adding a new sentence at subparagraph (g)2. that expressly states that 
``A replacement unit, as defined in subparagraph (bbb) of this rule is 
an existing emissions unit.''. This sentence references the new 
definition of ``replacement unit'' at Rule 335-3-14-.04(2)(bbb), as 
presented above, and is consistent with the Federal definition of the 
term ``replacement unit'' at 40 CFR 52.21(b)(33). Based on the change 
proposed in the May 7, 2012, SIP revision, Rule 335-3-14-.04(2)(g) 
would read as follows:
    (g) ``Emissions Unit'' shall mean any part of a stationary source 
which emits or would have the potential to emit any regulated NSR 
pollutant including an electric utility steam generating unit as 
defined in subparagraph (2)(vv) of this rule. For purposes of this 
rule, there are two types of emissions units as

[[Page 11917]]

described in subparagraphs (2)(g)1. and 2. of this rule.
    1. A new emissions unit is any emissions unit that is (or will be) 
newly constructed and that has existed for less than 2 years from the 
date such emissions unit first operated.
    2. An existing emissions unit is any emissions unit that does not 
meet the requirements of subparagraph (2)(g)1. of this rule. A 
replacement unit, as defined in subparagraph (bbb) of this rule, is an 
existing emissions unit.
    EPA has preliminarily concluded that these changes to Rule 335-3-
14-.04(2)(g) and the adoption of Rule 335-3-14-.04(2)(bbb) will not 
interfere with any applicable requirement concerning attainment and 
reasonable further progress (as defined in section 171), or any other 
applicable requirement of the CAA. The aforementioned changes align 
Alabama's PSD regulations regarding replacement units, which are found 
at Rule 335-3-14-.04, with the Federal PSD regulations. Therefore, EPA 
is proposing to approve these changes into the Alabama 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 ADEM Administrative Code Rule 335-3-14-.04(2)(g) and 335-3-
14-.04(2)(bbb), which add a definition of ``replacement unit'' and 
provide that a replacement unit is a type of existing emissions unit 
under the definition of ``emissions unit,'' state effective on October 
5, 2018. 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).

V. Proposed Action

    EPA is proposing to approve changes to the Alabama SIP, that were 
provided to EPA through Alabama's May 7, 2012, SIP revision, with the 
exception of portions that were withdrawn in the May 7, 2017, 
withdrawal letter, as well as changes provided to EPA through Alabama's 
August 27, 2018, SIP revision. Specifically, EPA is proposing to 
approve changes to ADEM Administrative Code Rule 335-3-14-.04(2)(g), as 
well as new Rule 335-3-14-.04(2)(bbb), as described above, in order to 
make Alabama's PSD program consistent with Federal provisions and the 
CAA regarding RMRR. This action is limited to the two rules currently 
before the Agency and does not modify any other PSD rules in Alabama's 
SIP.

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. This action merely 
proposes to approve state law as meeting Federal requirements and does 
not impose additional requirements beyond those imposed by state law. 
For that reason, this proposed action:
     Is not a significant regulatory action subject to review 
by the Office of Management and Budget under Executive Orders 12866 (58 
FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
     Is not an Executive Order 13771 (82 FR 9339, February 2, 
2017) regulatory action because SIP approvals are exempted under 
Executive Order 12866;
     Does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or 
uniquely affect small governments, as described in the Unfunded 
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have Federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
     Is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of section 12(d) of the 
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 
note) because application of those requirements would be inconsistent 
with the 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).
    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, the rule does 
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, Intergovernmental relations, Lead, Nitrogen 
dioxide, Ozone, Particulate matter, Reporting and recordkeeping 
requirements, Sulfur oxides, Volatile organic compounds.

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

    Dated: March 18, 2019.
Mary S. Walker,
Acting Regional Administrator, Region 4.
[FR Doc. 2019-06108 Filed 3-28-19; 8:45 am]
 BILLING CODE 6560-50-P