Document ID: EPA-R10-OAR-2010-0921-0001
Agency: epa
Document Type: Proposed Rule
Title: Approvals and Promulgations of Implementation Plans: Alaska; Prevention of Significant Deterioration; Greenhouse Gas Permitting Authority and Tailoring Rule Revision
Posted Date: 2010-12-06T05:00Z

[Federal Register Volume 75, Number 233 (Monday, December 6, 2010)]
[Proposed Rules]
[Pages 75658-75661]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-30479]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R10-OAR-2010-0921, FRL-9235-6]

Approval and Promulgation of Implementation Plans; Alaska: 
Prevention of Significant Deterioration; Greenhouse Gas Permitting 
Authority and Tailoring Rule Revision

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to approve a draft revision to the State 
Implementation Plan (SIP), submitted by the Commissioner of the Alaska 
Department of Environmental Conservation (ADEC) to EPA on October 25, 
2010, for parallel processing. The proposed SIP revision updates 
Alaska's Prevention of Significant Deterioration (PSD) program to 
reflect changes to the Federal PSD program relating to the permitting 
of greenhouse gas (GHG) emissions. EPA is proposing in this action to 
approve those revisions if the final SIP revision submitted by Alaska 
to EPA is consistent with the draft SIP revision.

DATES: Comments must be received on or before January 5, 2011.

[[Page 75659]]

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R10-
OAR-2010-0921, by any of the following methods:
     http://www.regulations.gov: Follow the on-line 
instructions for submitting comments.
     E-mail: R10-Public_Comments@epa.gov.
     Mail: Scott Hedges, EPA Region 10, Office of Air, Waste 
and Toxics (AWT-107), 1200 Sixth Avenue, Suite 900, Seattle, WA 98101.
     Hand Delivery/Courier: EPA Region 10, 1200 Sixth Avenue, 
Suite 900, Seattle, WA 98101. Attention: Scott Hedges, Office of Air, 
Waste and Toxics, AWT-107. Such deliveries are only accepted during 
normal hours of operation, and special arrangements should be made for 
deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-R10-OAR-
2010-0921. 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 whose 
disclosure is restricted by statute. Do not submit information that you 
consider to be CBI or otherwise protected through http://www.regulations.gov or e-mail. The http://www.regulations.gov Web site 
is an ``anonymous access'' system, which means EPA will not know your 
identity or contact information unless you provide it in the body of 
your comment. If you send an e-mail comment directly to EPA without 
going through http://www.regulations.gov your e-mail 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 and with any 
disk or CD-ROM you submit. 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, any form of encryption, and be free of 
any defects or viruses.
    Docket: All documents in the docket are listed in the http://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, is not placed on the Internet and will be 
publicly available only in hard copy. Publicly available docket 
materials are available either electronically in http://www.regulations.gov or in hard copy during normal business hours at the 
Office of Air, Waste and Toxics, EPA Region 10, 1200 Sixth Avenue, 
Seattle, WA 98101.

FOR FURTHER INFORMATION CONTACT: Scott Hedges at telephone number: 
(206) 553-0296, e-mail address: hedges.scott@epa.gov, or the above EPA, 
Region 10 address.

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

Table of Contents

I. What action is EPA proposing today?
II. What is the background for the action that EPA is proposing 
today?
III. What is EPA's analysis of Alaska's proposed SIP revision?
IV. Proposed Action
V. Statutory and Executive Order Reviews

I. What action is EPA proposing today?

    On October 25, 2010, ADEC submitted a draft revision to EPA for 
approval into the Alaska's SIP to update Alaska's PSD program to 
reflect changes to the Federal PSD program that would authorize the 
State of Alaska to regulate GHGs under its PSD program and establish 
appropriate emission thresholds for determining which new or modified 
stationary sources become subject to Alaska's PSD permitting 
requirements for GHG emissions. ADEC subsequently clarified in an e-
mail dated November 16, 2010, that its request is limited to updating 
the incorporation by reference date of 40 CFR 52.21 in 18 AAC 50.040(h) 
in order to incorporate the new definition of ``subject to regulation'' 
in 40 CFR 52.21(49) to clarify the meaning of the definition of 
``regulated NSR pollutant'' in the Alaska SIP so as to make the Alaska 
SIP consistent with Federal PSD requirements for the regulation of 
GHGs.
    Because this draft SIP revision is not yet State-effective, Alaska 
requested that EPA ``parallel process'' the SIP revision. Under this 
procedure, the EPA Regional Office works closely with the State while 
developing new or revised regulations. Generally, the State submits a 
copy of the proposed regulation or other revisions before final 
promulgation by the State. EPA reviews this proposed State action and 
prepares a notice of proposed rulemaking. EPA publishes this notice of 
proposed rulemaking in the Federal Register and solicits public comment 
in approximately the same time frame during which the State is 
completing its rulemaking action.
    In this case, the regulatory revisions submitted in Alaska's 
October 25, 2010, proposed SIP revision have already gone through 
public review and were adopted by the Commissioner of ADEC on September 
27, 2010. On November 8, 2010, ADEC provided EPA with a revised draft 
submittal following review by the Alaska Department of Law. On November 
16, 2010, ADEC advised EPA that the revisions that were filed by the 
Alaska Lieutenant Governor on November 9, 2010, will become effective 
as a matter of State law on December 8, 2010, and will be submitted as 
a final SIP revision before December 1, 2010. Therefore, EPA is 
processing this proposed rulemaking prior to Alaska's submission of the 
final SIP revision.
    EPA is proposing to approve the update to 18 AAC 50.040(h) with 
respect to the definition of ``subject to regulation'' as a revision to 
the Alaska SIP if the final SIP revision relating to the PSD permitting 
of GHGs submitted by Alaska to EPA is consistent with the proposed SIP 
revision. Final approval of Alaska's SIP revision will make Alaska's 
SIP for GHG-emitting sources consistent with Federal PSD requirements 
for GHG emissions, including the GHG emission thresholds for PSD 
applicability. If changes are made to the SIP revision after this 
proposal, such changes will be acknowledged in EPA's final rulemaking 
action and, if such changes are significant, may require a reproposal 
and an additional public comment period.

II. What is the background for the action that EPA is proposing today?

    On June 3, 2010 (effective August 2, 2010), EPA promulgated a final 
rulemaking tailoring the applicability criteria that determine which 
stationary sources and modification projects become subject to 
permitting requirements for GHG emissions under the PSD and title V 
permitting programs. See ``Prevention of Significant Deterioration and 
title V Greenhouse Gas Tailoring Rule; Final Rule,'' (the Tailoring 
Rule), 75 FR 31514 (June 3, 2010).\1\ In particular, by amending the 
definition of ``subject to regulation,'' EPA established thresholds for 
GHGs with a phase-in approach for PSD applicability and established the 
first

[[Page 75660]]

two steps of the phase-in for the largest GHG-emitters. As EPA 
explained in the Tailoring Rule, the threshold limitations are 
necessary because without it, PSD would apply to all stationary sources 
that emit or have the potential to emit more than 100 or 250 tons of 
GHGs per year beginning on January 2, 2011. This is the date when EPA's 
recently promulgated Light Duty Vehicle Rule takes effect,\2\ imposing 
control requirements for the first time on GHGs. If this January 2, 
2011, date were to pass without the Tailoring Rule being in effect, PSD 
requirements would apply to GHG emissions at the 100/250 tons per year 
applicability levels provided under a literal reading of the Clean Air 
Act (CAA or the Act) as of that date. From that point forward, a source 
owner proposing to construct any new major source that emits at or 
higher than the applicability levels (and which therefore may be 
referred to as a ``major'' source) or modify any existing major source 
in a way that would increase GHG emissions would need to obtain a 
permit under the PSD program that addresses these emissions before 
construction or modification could begin. See 75 FR 31514.
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    \1\ The Tailoring Rule also applies to the title V program, 
which requires operating permits for existing sources. However, 
today's action does not affect Alaska's title V program.
    \2\ See ``Light-Duty Vehicle Greenhouse Gas Emission Standards 
and Corporate Average Fuel Economy Standards; Final Rule,'' 75 FR 
25324 (May 7, 2010).
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    As explained in the Tailoring Rule, many State, local and Tribal 
area programs will likely be able to immediately implement the approach 
in the Tailoring Rule without rule or statutory changes by, for 
example, interpreting the term ``subject to regulation'' that is part 
of the applicability provisions for PSD permitting. EPA has requested 
permitting authorities to confirm that they will follow this 
implementation approach for their programs, and if they cannot, then 
EPA has requested that they notify the Agency so that we can take 
appropriate follow-up action to narrow Federal approval of their 
programs before GHGs become subject to PSD permitting on January 2, 
2011. Narrowing EPA's approval will ensure that for Federal purposes, 
sources with GHG emissions that are less than the Tailoring Rule's 
emission thresholds will not be obligated under Federal law to obtain 
PSD permits during the gap between when GHG PSD requirements go into 
effect on January 2, 2011 and when either (1) EPA approves a SIP 
revision adopting EPA's tailoring approach, or (2) if a State opts to 
regulate smaller GHG-emitting sources, the State demonstrates to EPA 
that it has adequate resources to handle permitting for such sources. 
EPA expects to finalize the narrowing action prior to the January 2, 
2011 deadline with respect to those States for which EPA will not have 
approved the Tailoring Rule thresholds in their SIPs by that time.
    On August 2, 2010, Alaska provided a letter to EPA explaining that 
its PSD rules only apply to pollutants ``subject to regulation'' at the 
time of adoption in July 1, 2004, and that Alaska thus did not have 
authority to issue PSD permits that address GHG emissions. By notice 
dated September 2, 2010, EPA issued a proposed ``Action to Ensure 
Authority to Issue Permits Under the Prevention of Significant 
Deterioration Program to Sources of Greenhouse Gas Emissions: Finding 
of Substantial Inadequacy and SIP Call, Proposed Rule,'' 75 FR 53892 
(September 2, 2010) (GHG SIP Call). In that action, along with a 
companion proposal published at the same time, EPA took steps to ensure 
that in States that do not appear to have authority to issue PSD 
permits to GHG-emitting sources at present, either the State or EPA 
will have the authority to issue such permits by January 2, 2011. EPA 
explained in the GHG SIP Call that, although for most States, either 
the State or EPA is already authorized to issue PSD permits for GHG-
emitting sources as of that date, our preliminary information showed 
that 13 States, including Alaska, have EPA-approved PSD programs that 
do not appear to include GHG-emitting sources and therefore do not 
appear to authorize these States to issue PSD permits to such sources. 
Therefore, EPA proposed to find that these 13 States' SIPs are 
substantially inadequate to comply with CAA requirements and, 
accordingly, proposed to issue a SIP Call to require a SIP revision 
that applies their SIP PSD programs to GHG-emitting sources.\3\
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    \3\ As explained in the proposed GHG SIP Call (75 FR 53892, 
53896), EPA intends to finalize its finding of substantial 
inadequacy and the SIP call for the 13 listed States by December 
1,2010. EPA requested that the States for which EPA is proposing a 
SIP call identify the deadline--between 3 weeks and 12 months from 
the date of signature of the final SIP Call--that they would accept 
for submitting their corrective SIP revision.
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    In a companion rulemaking issued on the same date, EPA proposed a 
Federal Implementation Plan (FIP) that would give EPA authority to 
apply EPA's PSD program to GHG-emitting sources in any State that is 
unable to submit a corrective SIP revision by its deadline. See 
``Action to Ensure Authority to Issue Permits Under the Prevention of 
Significant Deterioration Program to Sources of Greenhouse Gas 
Emissions: Federal Implementation Plan, Proposed Rule,'' 75 FR 53883 
(September 2, 2010) (GHG FIP). Alaska was one of the States for which 
EPA proposed a SIP Call and a FIP because, as discussed above, Alaska 
advised EPA that it did not interpret its then current PSD regulations 
as providing it with the authority to regulate GHGs.
    Alaska's proposed SIP revision that is the subject of this 
rulemaking, however, addresses this authority. Therefore, if the State 
submits its final SIP revision to EPA prior to the final rulemaking for 
the GHG SIP Call, EPA will not take final action on the GHG SIP Call 
for Alaska. Additionally, Alaska would not be subject to the FIP if EPA 
finalizes today's proposed approval of the Alaska's SIP revision.

III. What is EPA's analysis of Alaska's proposed SIP revision?

    The State of Alaska is currently a SIP-approved State for the PSD 
program, and has incorporated EPA's 2002 New Source Review (NSR) reform 
revisions for PSD into its SIP. See 72 FR 45378 (August 14, 2007). 
However, Alaska does not interpret its PSD rules that are currently in 
the SIP, which generally incorporate the Federal rules by reference, to 
be automatically updating to include newly designated regulated air 
pollutants such as GHGs. As discussed above, in a letter provided to 
EPA on August 2, 2010, Alaska notified EPA that the State did not then 
have the authority to regulate GHGs under the PSD program and thus was 
in the process of revising its regulations (the subject of this 
proposed action) to provide this authority.
    The proposed rules submitted by ADEC to EPA with the proposed SIP 
revision updates its incorporation by reference of the Federal PSD 
requirements at 40 CFR 51.166 and 40 CFR 52.21-40 CFR 52.22 (Prevention 
of Significant Deterioration of Air Quality) to include all revisions 
to these Federal requirements as of August 2, 2010, the effective date 
of the Tailoring Rule. See 18 AAC 50.040(h). ADEC has requested that 
EPA approve this update only with respect to the definition of 
``subject to regulation'' in 40 CFR 52.21(b)(49) promulgated in the 
Tailoring Rule (effective August 2, 2010), which in turn clarifies the 
meaning of the State definition of ``regulated NSR pollutant.'' \4\ As 
discussed below, ADEC intends to request that EPA approve

[[Page 75661]]

these rule revisions with respect to all other changes in a subsequent 
and separate SIP revision request.
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    \4\ 18 AAC 50.040(h)(4)(C)(i) states that the definition of 
``regulated NSR pollutant'' in 40 CFR 52.21(b)(50) is not adopted 
and that that term shall have the meaning assigned to it in 18 AAC 
50.990. The SIP-approved version of 18 AAC 50.990(92) states that 
``regulated NSR pollutant'' has the meaning given in 40 CFR 
51.166(b)(49), which is the same definition as in 40 CFR 
52.21(b)(50).
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    As discussed above, unless EPA either approves the Alaska SIP 
revision authorizing the PSD permitting of GHG emissions by January 2, 
2010, or unless EPA promulgates a FIP to do so, such sources will be 
unable to receive preconstruction permits and therefore may not be able 
to construct or modify in the State of Alaska after that date. Alaska's 
incorporation by reference of the new definition of ``subject to 
regulation'' at 40 CFR 52.21(b)(49) is consistent with EPA's regulation 
of GHG emissions under the Federal PSD program. Therefore, if the final 
SIP submitted by ADEC to EPA is consistent with the proposed SIP 
revision, EPA is proposing to approve this revision because Alaska's 
regulation is consistent with the CAA PSD requirements and its 
implementing regulations regarding GHGs.

IV. Proposed Action

    Pursuant to section 110 of the CAA, EPA is proposing to approve the 
State of Alaska's draft SIP revision that reflects changes to the 
Federal PSD program as of August 2, 2010, relating to the permitting of 
GHGs if the final SIP revision submitted by Alaska to EPA is consistent 
with the proposed SIP revision. This proposed SIP revision provides 
Alaska with the authority to regulate GHGs under its PSD program and 
establishes appropriate emissions thresholds for determining PSD 
applicability to new and modified GHG-emitting sources in accordance 
with EPA's Tailoring Rule. EPA has made the preliminary determination 
that this SIP revision is approvable because it is in accordance with 
the CAA and EPA regulations regarding PSD permitting for GHGs.
    Note that ADEC has made other changes to its rules for PSD 
permitting and other air regulations that it has not submitted as part 
of this draft SIP revision (subject to this action) and does not intend 
to submit as part of its final SIP submission. However, ADEC does 
intend to submit these other rules and regulations as a subsequent SIP 
revision in the near future. Because of the need to approve as a SIP 
revision the changes relating to the PSD permitting of GHGs by January 
2, 2011 or as soon thereafter as possible to ensure the State has 
adequate authority to issue PSD permits to subject sources emitting 
GHGs, once the requirements go into effect as a matter of Federal law, 
EPA believes it is appropriate to approve Alaska's revisions that 
update the Alaska PSD program to address GHG emissions as a SIP 
strengthening measure.

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 
proposed action merely approves the State's law as meeting Federal 
requirements and does not impose additional requirements beyond those 
imposed by the State's 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 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 
Alaska, 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, Incorporation by 
reference, Intergovernmental relations, and Reporting and recordkeeping 
requirements.

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

    Dated: November 19, 2010.
Dennis J. McLerran,
Regional Administrator, Region 10.
[FR Doc. 2010-30479 Filed 12-3-10; 8:45 am]
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