Document ID: EPA-HQ-OAR-2010-0107-0164
Agency: epa
Document Type: Rule
Title: Action to Ensure Authority to Issue Permits under Prevention of Significant Deterioration Program to Sources of Greenhouse Gas Emissions: Federal Implementation Plan for Jefferson County, KY
Posted Date: 2011-01-14T05:00Z

[Federal Register Volume 76, Number 10 (Friday, January 14, 2011)]
[Rules and Regulations]
[Pages 2581-2589]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-768]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-HQ-OAR-2010-0107; FRL-9253-3]

Action To Ensure Authority To Issue Permits Under the Prevention 
of Significant Deterioration Program to Sources of Greenhouse Gas 
Emissions: Federal Implementation Plan for Jefferson County, KY

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is establishing a federal implementation plan (FIP) to 
apply in Jefferson County, Kentucky because the

[[Page 2582]]

Louisville Metro Air Pollution Control District (LMAPCD), through the 
Commonwealth of Kentucky, has not submitted by its established deadline 
of January 1, 2011, a state implementation plan (SIP) revision to apply 
their Clean Air Act (CAA or Act) Prevention of Significant 
Deterioration (PSD) program to sources of greenhouse gases (GHGs). This 
action will ensure that a permitting authority--EPA--is available in 
Jefferson County, Kentucky to issue preconstruction PSD permits to GHG-
emitting sources. This action is related to EPA's recent final rule, 
the GHG PSD SIP Call, published on December 13, 2010, in which EPA made 
a finding of substantial inadequacy and issued a SIP call to LMAPCD 
because the SIP for Jefferson County does not apply the PSD program to 
GHG-emitting sources.

DATES: This action is effective on January 14, 2011.

ADDRESSES: EPA has established a docket for this rulemaking under 
Docket ID No. EPA-HQ-OAR-2010-0107. 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, 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 at the 
U.S. Environmental Protection Agency, Air Docket, EPA/DC, EPA West 
Building, Room 3334, 1301 Constitution Ave., NW., Washington, DC. The 
Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through 
Friday, excluding legal holidays. The telephone number for the Public 
Reading Room is (202) 566-1744, and the telephone number for the Air 
Docket is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: Ms. Cheryl Vetter, Air Quality Policy 
Division, Office of Air Quality Planning and Standards (C504-03), 
Environmental Protection Agency, Research Triangle Park, NC 27711; 
telephone number: (919) 541-4391; fax number: (919) 541-5509; e-mail 
address: vetter.cheryl@epa.gov. For more information on the LMAPCD or 
Jefferson County, Kentucky, contact Ms. Lynorae Benjamin, Chief, 
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. 
Benjamin's telephone number is (404) 562-9040; e-mail address: 
benjamin.lynorae@epa.gov.

SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this action apply to me?

    The entity affected by this rule is the LMAPCD, which is the local 
permitting authority \1\ that has jurisdiction in Jefferson County, 
Kentucky. The LMAPCD was identified by EPA as not having submitted a 
SIP revision that would apply PSD requirements to GHG-emitting sources 
by its SIP submittal deadline of January 1, 2011. In the GHG PSD SIP 
call,\2\ EPA determined that the Jefferson County portion of the 
Kentucky SIP is substantially inadequate to achieve CAA requirements 
because its PSD programs do not apply to GHG-emitting sources. EPA 
established the deadline after the LMAPCD indicated that it would not 
object to a deadline of January 1, 2011.
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    \1\ For convenience, we refer to ``states'' in this rulemaking 
to collectively mean states and local permitting authorities.
    \2\ 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--Final rule, 75 FR 77698 (December 13, 2010).
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    Entities potentially affected by this rule also include sources in 
all industry groups, which have a direct obligation under the CAA to 
obtain a PSD permit for GHGs for projects that meet the applicability 
thresholds set forth in the Tailoring Rule.\3\ This independent 
obligation on sources is specific to PSD and derives from CAA section 
165(a). Any source that is subject to a state PSD air permitting 
regulation not structured to apply to GHG-emitting sources will rely on 
this rule to obtain a permit that contains emission limitations that 
conform to requirements under CAA section 165(a). The majority of 
entities potentially affected by this action are expected to be in the 
following groups:
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    \3\ Prevention of Significant Deterioration and Title V 
Greenhouse Gas Tailoring Rule; Final Rule. 75 FR 31514 (June 3, 
2010).

------------------------------------------------------------------------
              Industry group                          NAICS \a\
------------------------------------------------------------------------
Utilities (electric, natural gas, other     2211, 2212, 2213
 systems).
Manufacturing (food, beverages, tobacco,    311, 312, 313, 314, 315, 316
 textiles, leather).
Wood product, paper manufacturing.........  321, 322
Petroleum and coal products manufacturing.  32411, 32412, 32419
Chemical manufacturing....................  3251, 3252, 3253, 3254,
                                             3255, 3256, 3259
Rubber product manufacturing..............  3261, 3262
Miscellaneous chemical products...........  32552, 32592, 32591, 325182,
                                             32551
Nonmetallic mineral product manufacturing.  3271, 3272, 3273, 3274, 3279
Primary and fabricated metal manufacturing  3311, 3312, 3313, 3314,
                                             3315, 3321, 3322, 3323,
                                             3324, 3325, 3326, 3327,
                                             3328, 3329
Machinery manufacturing...................  3331, 3332, 3333, 3334,
                                             3335, 3336, 3339
Computer and electronic products            3341, 3342, 3343, 3344,
 manufacturing.                              3345, 4446
Electrical equipment, appliance, and        3351, 3352, 3353, 3359
 component manufacturing.
Transportation equipment manufacturing....  3361, 3362, 3363, 3364,
                                             3365, 3366, 3366, 3369
Furniture and related product               3371, 3372, 3379
 manufacturing.
Miscellaneous manufacturing...............  3391, 3399
Waste management and remediation..........  5622, 5629
Hospitals/nursing and residential care      6221, 6231, 6232, 6233, 6239
 facilities.
Personal and laundry services.............  8122, 8123
Residential/private households............  8141
Non-residential (commercial)..............  Not available. Codes only
                                             exist for private
                                             households, construction
                                             and leasing/sales
                                             industries.
------------------------------------------------------------------------
\a\ North American Industry Classification System.

[[Page 2583]]

B. How is the preamble organized?

    The information presented in this preamble is organized as follows:

I. General Information
    A. Does this action apply to me?
    B. How is the preamble organized?
II. Overview of Rulemaking
III. Final Action and Response to Comments
    A Authority To Promulgate a FIP
    B. Timing of GHG PSD FIP
    C. Substance of GHG PSD FIP
    D. Period for GHG PSD FIP To Remain in Place
    E. Primacy of SIP Process
IV. Statutory and Executive Order Reviews
    A. Executive Order 12866--Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132--Federalism
    F. Executive Order 13175--Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045--Protection of Children From 
Environmental Health Risks and Safety Risks
    H. Executive Order 13211--Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898--Federal Actions to Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Determination Under Section 307(d)
    L. Congressional Review Act
V. Judicial Review
VI. Statutory Authority

II. Overview of Rulemaking

    In this rulemaking, EPA is establishing a FIP, which we call the 
GHG PSD FIP, or simply, the FIP, to apply in Jefferson County, Kentucky 
because the LMAPCD did not submit by January 1, 2011, a corrective SIP 
revision to apply their CAA PSD program to sources of GHGs in Jefferson 
County, Kentucky.\4\ This is the deadline EPA established after the 
LMAPCD indicated that it would not object to it, to ensure that a 
permitting authority would be in place soon after January 2, 2011, to 
facilitate issuance of PSD permits for construction and modification of 
sources. This action does not relate to the rest of Kentucky, as the 
Commonwealth, through the Kentucky Energy and Environment Cabinet 
(KEEC), submitted a corrective SIP revision to address the remainder of 
Kentucky on December 13, 2010. This SIP revision was approved by EPA on 
December 29, 2010 (75 FR 81868).
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    \4\ The Louisville Metro Air Pollution Control District is the 
local agency that has jurisdiction over sources in Jefferson County, 
Kentucky.
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    This preamble should be read in conjunction with the preamble for 
the proposed rulemaking for this action, which we call the GHG PSD FIP 
proposal or the FIP proposal; \5\ and the SIP Call rulemaking that is 
associated with this rulemaking, including (i) the proposed SIP Call 
rulemaking, which we call the GHG PSD SIP Call proposal or the SIP Call 
proposal, and which accompanied the FIP proposal; \6\ (ii) the final 
SIP Call rulemaking, which we call the GHG PSD SIP Call or the SIP 
Call; and (iii) the GHG PSD FIP final rule which covers seven states 
other than Jefferson County, Kentucky.\7\ Background information for 
this rulemaking is found in those rulemakings and in the rulemakings 
referenced therein and will not be reiterated here.
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    \5\ 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).
    \6\ 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).
    \7\ Action to Ensure Authority to Issue Permits under the 
Prevention of Significant Deterioration Program to Sources of 
Greenhouse Gas Emissions: Federal Implementation Plan--Final Rule, 
75 FR 82246 (December 30, 2010).
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    By notices dated September 2, 2010, EPA published as companion 
actions the SIP Call proposal and the FIP proposal. In the SIP Call 
proposal, EPA proposed to find that 13 states with EPA-approved SIP PSD 
programs are substantially inadequate to meet CAA requirements because 
they do not appear to apply PSD requirements to GHG-emitting sources. 
For each of these states, EPA proposed to require the state (through a 
SIP call) to revise its SIP as necessary to correct such inadequacies. 
In the FIP proposal, EPA proposed a FIP to apply in any state that is 
unable to submit, by its deadline, a corrective SIP revision to apply 
the PSD program to sources of GHGs. The FIP would provide authority to 
EPA to issue PSD permits for construction or modification of 
appropriate GHG sources in the state.
    On December 1, 2010, EPA promulgated the GHG PSD SIP Call, and EPA 
published it by notice dated December 13, 2010.\8\ In the SIP call, EPA 
finalized its finding that the SIPs of 13 states (comprising 15 state 
and local programs) are substantially inadequate to meet CAA 
requirements because they do not apply PSD requirements to GHG-emitting 
sources. In addition, EPA finalized a SIP Call for each of these 
states, which required the state to revise its SIP as necessary to 
correct such inadequacies. Further, EPA established a deadline for each 
state to submit its corrective SIP revision. These deadlines, which 
differed among the states, ranged from December 22, 2010, to December 
1, 2011. The LMAPCD requested a SIP deadline of January 1, 2011.
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    \8\ 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--Final Rule, 75 FR 77698 (December 13, 2010).
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    In a separate notice, EPA is also issuing a finding under CAA 
section 110(c)(1)(A) that the LMAPCD ``failed to make [the] required 
submission'' of the corrective SIP call-mandated SIP revision for 
Jefferson County, Kentucky by its January 1, 2011 deadline. EPA 
notified the LMAPCD of the finding by letter. That letter is located in 
the docket for this rulemaking.

III. Final Action and Response to Comments

A. Authority To Promulgate a FIP

    In this rulemaking, EPA is finalizing the GHG PSD FIP as proposed 
for Jefferson County, Kentucky. This rulemaking does not relate to the 
remainder of the Commonwealth as EPA has already taken final action to 
approve the Commonwealth's corrective SIP for all areas in Kentucky 
except for Jefferson County. See 75 FR 81868.
    The CAA authority for EPA to promulgate a FIP is found in CAA 
section 110(c)(1), which provides--

    The Administrator shall promulgate a Federal implementation plan 
at any time within 2 years after the Administrator--(A) finds that a 
State has failed to make a required submission * * * unless the 
State corrects the deficiency, and [EPA] approves the plan or plan 
revision, before the Administrator promulgates such [FIP].

    As noted earlier in this preamble, EPA is issuing a finding that 
the LMAPCD, through the Commonwealth of Kentucky, ``failed to make 
[the] required submission'' of the corrective SIP Call-mandated SIP 
revision by its January 1, 2011, deadline. Accordingly, under CAA 
section 110(c)(1), EPA is required to promulgate a FIP for Jefferson 
County, Kentucky. It should be noted that EPA specifically proposed the 
FIP for Jefferson County, Kentucky.
    We reiterate that the LMAPCD indicated to EPA that it preferred 
that EPA promulgate a FIP to take effect soon after January 2, 2011--
when sources in the state become subject to PSD--rather than wait to 
promulgate a FIP until a later time. This is because the LMAPCD wishes 
to assure that a permitting authority for GHG-emitting sources is in 
place in Jefferson County, Kentucky should a permit be sought that 
requires consideration of GHGs. The LMAPCD

[[Page 2584]]

made this choice by indicating that they did not object to EPA 
establishing a SIP submittal date of January 1, 2011, when EPA made 
clear in the proposed SIP Call and FIP that if the state did not submit 
the required SIP revision by that date, then EPA would promulgate the 
FIP the next day. 75 FR at 53904/2 (proposed SIP Call); id. at 53889/2 
(proposed FIP). Although the LMAPCD requested a later SIP deadline than 
the earliest date (i.e., December 22, 2010), they believe that this 
will only mean a short delay in the availability of a permitting 
authority for GHG-emitting sources in their state, and that delay will 
not adversely affect their sources.
    In this rulemaking, EPA is not taking final action to promulgate a 
FIP for any of the other states beside Jefferson County, Kentucky which 
EPA included in the FIP proposal. This is because each of the other 
states falls into one of the following three categories: (1) EPA did 
not finalize the SIP call for this state; (2) EPA has already issued a 
FIP for this state; \9\ or (3) EPA did finalize the SIP call but 
established a SIP submittal deadline that has not yet arrived. As EPA 
noted in the GHG FIP signed on December 23, 2010, it continues to be 
EPA's intent that if any of these other states does not submit the 
required SIP revision by its deadline, then EPA will immediately issue 
a finding of failure to submit a required SIP submission and 
immediately promulgate a GHG PSD FIP for that state.
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    \9\ On December 30, 2010, EPA published a notice to promulgate a 
FIP for seven states that received a SIP submittal deadline of 
December 22, 2010. Based on information received from each of these 
states during the public comment period, they indicated that they 
would not object to this early deadline for allowing a FIP to be put 
in place. These seven states are: (1) Arizona: Both Pinal County and 
Rest of State (excluding Maricopa County, Pima County, and Indian 
Country); (2) Arkansas; (3) Florida; (4) Idaho; (5) Kansas; (6) 
Oregon; and (7) Wyoming.
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    In comments received, some commenters stated, ``Remarkably, EPA 
states that it will also directly promulgate a SIP call and FIP for any 
states it has inadvertently omitted from its notice of proposed 
rulemaking.'' Although the commenters do not elaborate upon this 
statement, they seem to imply that it would be improper for EPA to 
finalize a FIP for such states because we did not provide adequate 
notice and opportunity for comment.
    This comment is not relevant to Jefferson County, Kentucky, as the 
proposed SIP call and FIP explicitly name Jefferson County as an area 
that may be included in the final SIP Call and FIP. Furthermore, we 
disagree with the commenters, and have discussed and responded to this 
comment in great detail in the SIP Call, 75 FR at 77715-16, and the 
December 30, 2010 FIP, 75 FR 82248.

B. Timing of GHG PSD FIP

    In the GHG PSD FIP proposal, we stated:

    If any of the states for which we issue the SIP Call does not 
meet its SIP submittal deadline, we will immediately issue a finding 
of failure to submit a required SIP submission, under CAA section 
110(c)(1)(A), and immediately thereafter promulgate a FIP for the 
state. This timing for FIP promulgation is authorized under CAA 
section 110(c)(1), which authorizes us to promulgate a FIP ``at any 
time within 2 years after'' finding a failure to submit a required 
SIP submission. We intend to take these actions immediately in order 
to minimize any period of time during which larger-emitting sources 
may be under an obligation to obtain PSD permits for their GHGs when 
they construct or modify, but no permitting authority is authorized 
to issue those permits.

75 FR at 53,889/2.

    In this final rulemaking, we are proceeding in the same manner that 
we proposed, and for the same reasons. That is, we are exercising our 
discretion to promulgate the FIP for Jefferson County ``immediately in 
order to minimize any period of time during which larger-emitting 
sources may be under an obligation to obtain PSD permits for their GHGs 
when they construct or modify, but no permitting authority is 
authorized to issue those permits.'' 75 FR at 53889/2. We believe that 
acting immediately is in the best interests of the states and the 
regulated community.
    EPA received comments that the process EPA has employed in this 
action, which was to propose the FIP as a companion rule to the 
proposed SIP call, and then to finalize the FIP immediately after 
making a finding that a state has not submitted the required SIP 
revision by its deadline, ``is not how CAA section 110 works or how 
Congress intended it to work.'' The commenter added that--

    [O]nly after a state has * * * failed to [submit a SIP revision] 
after an applicable period as specified in the CAA or EPA 
regulations * * * and after EPA has made a determination that the 
SIP revision is deficient in one or more respects, may the Agency 
step in to propose a FIP rule. And only after taking that step could 
EPA then proceed * * * [to take final action on the FIP.] 
Notwithstanding EPA's strained and out-of-context emphasis on the 
isolated sentence fragment, ``at any time within,'' the very fact 
that the CAA affords EPA up to two full years in which to complete 
the cooperative task of considering whether a FIP is needed and how 
such a plan should be fashioned, and the corollary fact that the Act 
does not mandate any federal takeover in less than two years, 
militate against EPA's approach here to FIP rulemaking. In 
particular, those facts undermine EPA's assumption that it need not 
take the time to develop a proposed plan specifically directed at 
remedying identified deficiencies in a given state submission, and 
to give states and the regulated community a meaningful opportunity 
to comment on a proposed FIP that has been specifically developed to 
address the individual needs and circumstances of such a state. 
(Emphasis in original.)
    EPA disagrees with these comments. As we stated in the proposed 
rule, CAA section 110(c)(1)(A) authorizes EPA to promulgate a FIP ``at 
any time within 2 years after'' finding a failure to submit a required 
SIP revision. As we did in the seven-state FIP issued on December 30, 
2010, here we are promulgating the FIP immediately because we wish to 
minimize any disruption in permitting for the larger GHG-emitting 
sources and we are doing so after consultation with the affected state. 
The LMAPCD told EPA that they would not object to the promulgation of a 
FIP at the earliest possible date after January 1, 2011. Without the 
FIP, Jefferson County, Kentucky would be without an approved program to 
issue PSD permits for GHG-emitting sources until the LMAPCD, through 
the Commonwealth of Kentucky, submits, and EPA approves, a SIP 
revision. The FIP provides sources in Jefferson County, Kentucky with 
an immediate mechanism to obtain required permits for construction and 
modification until the revised SIP is approved.
    As for commenters' analysis of CAA section 110(c), that provision, 
by its terms, imposes no constraints on when EPA may propose a FIP. 
This stands in contrast to other CAA provisions that do impose 
requirements for the timing of proposals. See CAA sections 
109(a)(1)(A), 111(b)(1)(B). In light of the lack of constraints in CAA 
section 110(c), EPA was free to propose the FIP at the same time that 
EPA proposed the SIP call. We do not agree that the overall construct 
of CAA section 110 imposes the implicit constraints that the commenter 
identifies.
    Instead, what is important is that for each of the 13 states for 
which EPA specifically proposed the FIP, which were the same as the 
ones for which EPA proposed the SIP Call, the public had adequate 
notice of the circumstances under which EPA proposed that the state 
would become subject to the FIP. Those circumstances were that if EPA 
finalized the SIP Call, as proposed, for the state, and if the state 
did not submit a SIP revision

[[Page 2585]]

applying its PSD program to GHG-emitting sources by the deadline, EPA 
would establish a FIP for that state. In fact, EPA did finalize the SIP 
call for all but one of those 13 states and is now finalizing the FIP 
for Jefferson County, Kentucky. Further, EPA received comments on the 
proposed FIP from several states and/or industries located in states 
for which EPA proposed the FIP, which indicates that the FIP proposal 
provided adequate notice. See, e.g., comments identified in the 
rulemaking docket as document numbers 0084.1 (Texas), 0055.1 
(Arkansas), 0066.1 (Texas Industry Project), and 0109.1 (National 
Mining Association).
    Moreover, EPA was clear that for each state subject to the SIP Call 
that did not submit the required SIP revision by its SIP submittal 
deadline, EPA would immediately make a finding of failure to submit and 
immediately promulgate a FIP. EPA explained that this approach was 
needed to assure the availability of a permitting authority for sources 
in the state.
    Finally, each of the states and the public in general had adequate 
notice of the terms of the FIP as it would apply in any state. 
Specifically, EPA indicated that the FIP would apply PSD to GHG-
emitting sources at the Tailoring Rule thresholds.
    Therefore, the FIP proposal was clear as to the circumstances under 
which EPA proposed to promulgate a FIP, the timing for the FIP, and the 
terms of the FIP. Moreover, each of those three things applied to each 
state that would become subject to the SIP Call. Accordingly, the FIP 
proposal did, in fact, ``give states and the regulated community a 
meaningful opportunity to comment on a proposed FIP that has been 
specifically developed to address the individual needs and 
circumstances of such a state,'' as the commenter argues the FIP 
proposal needed to do.
    Several commenters raised an additional objection, which was that 
in their view, EPA failed to comply with the requirements of CAA 
section 307(d)(3) that (i) the proposed FIP include a summary of ``the 
factual data on which the proposed rule is based'' and ``the major 
legal interpretations and policy considerations underlying the proposed 
rule''; and (ii) ``[a]ll data, information, and documents * * * on 
which the proposed rule relies shall be included in the docket on the 
date of publication of the proposed rule.'' (Emphasis added by one of 
these commenters.) One of these commenters explained that (a) in the 
SIP Call proposal, EPA had made a detailed request that states provide 
information as to whether their state law authorized the application of 
PSD to GHG-emitting sources; (b) this detailed request demonstrated 
that the proposal did not establish the legal basis for the SIP Call; 
and (c) as a result, the FIP proposal did not include ``information 
that is essential to determining whether a FIP for a given state is 
even appropriate and justified.'' (Emphasis in original.) This 
commenter added--

    Only after EPA has received such information, and then taken the 
necessary time to evaluate the information and to make judgments as 
to whether or not a given state has authority under its SIP and 
other elements of state law to regulate GHGs under the PSD program--
i.e., the steps EPA would have to take under CAA section 307(d)(3) 
to provide to the public a meaningful ``summary'' of ``the factual 
data on which the proposed rule is based'' and ``the major legal 
interpretations and policy considerations underlying the proposed 
rule''--may EPA propose a FIP for any state that has been determined 
to lack that authority. (Emphasis in original.)

    We disagree with this comment. The preamble for the FIP proposal 
included the CAA section 307(d)(3)-required ``summary'' of the factual 
basis and legal interpretations. To reiterate, EPA identified the 
states for which EPA was proposing the FIP, 75 FR at 53886 and table 
II-1 and 53889/1, and added that EPA would subject other states to the 
FIP if they, too, became subject to the SIP call, id. 53886 and table 
II-2 and 53889/2; described the timing for the FIP, id. 53889/2-3; 
described the substance of the FIP, id. 53889/3-53890/1; and explained 
that CAA section 110(c)(1) provided the legal basis, id. 53889/2. The 
purpose of the CAA section 307(d)(3) requirements is to provide the 
public with adequate notice, and these statements did so by making 
clear the circumstances under which EPA was proposing to promulgate a 
FIP and the timing and substance of the proposed FIP.
    It is true that for any state, whether and when EPA would finalize 
the FIP for any state depended on other factors, including whether EPA 
would finalize the SIP Call for that state, what deadline EPA would 
establish, and whether the state would submit its required corrective 
SIP revision by that deadline. But the FIP proposal put the public on 
notice, with sufficient specificity, as to EPA's plan. In any event, 
any FIP is necessarily dependent on other factors, including state 
actions, including submission of a revised SIP. Most broadly, 
commenters' approach--which is that EPA cannot propose a FIP in concert 
with a SIP call, but instead must proceed in seriatim by completing the 
SIP call first and then proposing the FIP--would result in lengthy 
delays in the establishment of a permitting authority to process GHG-
emitting sources' PSD permit applications. As a result, commenters' 
approach could well cause delays in these sources' ability to undertake 
construction and modification projects.
    We included related comments and responses in the Response to 
Comments document for the seven-state FIP issued on December 30, 
2010,\10\ which is applicable to this rule as well.
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    \10\ The Response to Comments document for the seven-state FIP 
can be found in the docket for this rulemaking at EPA-HQ-OAR-2010-
0107-0157.
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C. Substance of GHG PSD FIP

    In the FIP proposal, we stated:

    The proposed FIP constitutes the EPA regulations found in 40 CFR 
52.21, including the PSD applicability provisions, with a limitation 
to assure that, strictly for purposes of this rulemaking, the FIP 
applies only to GHGs. Under the PSD applicability provisions in 40 
CFR 52.21(b)(50), the PSD program applies to sources that emit the 
requisite amounts of any ``regulated NSR pollutant[s],'' including 
any air pollutant ``subject to regulation.'' However, in states for 
which EPA would promulgate a FIP to apply PSD to GHG-emitting 
pollutants, the approved SIP already applies PSD to other air 
pollutants. To appropriately limit the scope of the FIP, EPA 
proposes in this action to amend 40 CFR 52.21(b)(50) to limit the 
applicability provision to GHGs.
    We propose this FIP because it would, to the greatest extent 
possible, mirror EPA regulations (as well as those of most of the 
states). In addition, this FIP would readily incorporate the phase-
in approach for PSD applicability to GHG sources that EPA has 
developed in the Tailoring Rule and expects to develop further 
through additional rulemaking. As explained in the Tailoring Rule, 
incorporating this phase-in approach--including Steps 1 and 2 of the 
phase-in as promulgated in the Tailoring Rule--can be most readily 
accomplished through interpretation of the terms in the definition 
``regulated NSR pollutant,'' including the term ``subject to 
regulation.''
    In accordance with the Tailoring Rule, * * * the FIP would apply 
in Step 1 of the phase-in approach only to ``anyway sources'' (that 
is, sources undertaking construction or modification projects that 
are required to apply for PSD permits anyway due to their non-GHG 
emissions and that emit GHGs in the amount of at least 75,000 tpy on 
a CO2e basis) and would apply in Step 2 of the phase-in 
approach to both ``anyway sources'' and sources that meet the 
100,000/75,000-tpy threshold (that is, (i) sources that newly 
construct and would not be subject to PSD on account of their non-
GHG emissions, but that emit GHGs in the amount of at least 100,000 
tpy CO2e, and (ii) existing sources that emit GHGs in the 
amount of at least 100,000 tpy CO2e, that undertake 
modifications that would not trigger PSD on

[[Page 2586]]

the basis of their non-GHG emissions, but that increase GHGs by at 
least 75,000 tpy CO2e).
    Under the FIP, with respect to permits for ``anyway sources,'' 
EPA will be responsible for acting on permit applications for only 
the GHG portion of the permit, and the state will retain 
responsibility for the rest of the permit. Likewise, with respect to 
permits for sources that meet the 100,000/75,000-tpy threshold, our 
preferred approach--for reasons of consistency--is that EPA will be 
responsible for acting on permit applications for only the GHG 
portion of the permit, that the state permitting authorities will be 
responsible for the non-GHG portion of the permit, and EPA will 
coordinate with the state permitting authority as needed in order to 
fully cover any non-GHG emissions that, for example, are subject to 
BACT because they exceed the significance levels. We recognize that 
questions may arise as to whether the state permitting authorities 
have authority to permit non-GHG emissions; as a result, we solicit 
comment on whether EPA should also be the permitting authority for 
the non-GHG portion of the permit for these latter sources.
    We propose that the FIP consist of the regulatory provisions 
included in 40 CFR 52.21, except that the applicability provision 
would include a limitation so that it applies for purposes of this 
rulemaking only to GHGs.

75 FR 53889/3 to 53,890/1

    We are finalizing the FIP as we described it in the proposal, for 
the same reasons that we indicated in the proposal, all as quoted 
earlier in this preamble.
    State, industry, and environmental commenters questioned how having 
EPA issue the GHG portions of a permit while allowing states under a 
FIP to continue to be responsible for issuing the non-GHG portions of a 
PSD permit will work in practice. Commenters raised concerns about the 
potential for a source to be ``faced with conflicting requirements and 
the need to mediate among permit engineers making BACT decisions.''
    We appreciate the commenters' concern. We well recognize that 
dividing permitting responsibilities between two authorities--EPA for 
GHGs and the state for all other pollutants--will require close 
coordination between the two authorities to avoid duplication, 
conflicting determinations, and delays. We note that this situation is 
not without precedent. In many instances in the past, EPA has been the 
PSD permitting authority but the state has accepted a delegation for 
parts of the PSD program, so that a source has had to go to both the 
state and EPA for its permit. In addition, all nonattainment areas in 
the nation are in attainment or are unclassifiable for at least one 
pollutant, so that every nonattainment area is also a PSD area. In some 
of these areas, the state is the permitting authority for nonattainment 
new source review (NSR) and EPA is the permitting authority for PSD. As 
a result, there are instances in which a new or modifying source in 
such an area has needed a nonattainment NSR permit from the state and a 
PSD permit from EPA.
    EPA is working expeditiously to develop recommended approaches for 
EPA regions and affected states--including Jefferson County, Kentucky--
to use in addressing the shared responsibility of issuing PSD permits 
for GHG-emitting sources. In addition, as discussed below, we intend 
for the GHG PSD FIP to remain in place only as long as necessary for 
states' SIPs to be approved. Moreover, in this interim period, we 
intend to delegate permitting responsibility to those states that are 
able to implement it and that request it. States that request and 
receive a delegation will be responsible for issuing both the GHG part 
and the non-GHG part of the permit, and that will moot commenters' 
concerns about split permitting.

D. Period for GHG PSD FIP To Remain in Place

    In the FIP proposal, we stated our intention to leave any 
promulgated FIP in place for as short a period as possible, and to 
process any corrective SIP revision submitted by the state to fulfill 
the requirements of the SIP call as expeditiously as possible. 
Specifically, we stated:

    After we have promulgated a FIP, it must remain in place until 
the state submits a SIP revision and we approve that SIP revision. 
CAA section 110(c)(1). Under the present circumstances, we will act 
on a SIP revision to apply the PSD program to GHG sources as quickly 
as possible. Upon request of the state, we will parallel-process the 
SIP submittal. That is, if the state submits to us the draft SIP 
submittal for which the state intends to hold a hearing, we will 
propose the draft SIP submittal for approval and open a comment 
period during the same time as the state hearing. If the SIP 
submittal that the state ultimately submits to us is substantially 
similar to the draft SIP submittal, we will proceed to take final 
action without a further proposal or comment period. If we approve 
such a SIP revision, we will at the same time rescind the FIP.

75 FR 53889/2-3.

    We continue to have these same intentions. Thus, we reaffirm our 
intention to leave this GHG PSD FIP in place only as long as is 
necessary for the LMAPCD to submit and for EPA to approve a SIP 
revision that includes PSD permitting for GHG-emitting sources. As 
discussed in more detail later in this preamble, EPA continues to 
believe that the states should remain the primary permitting authority.

E. Primacy of SIP Process

    In the FIP proposal we stated,

    This proposal [to promulgate a FIP] is secondary to our 
overarching goal, which is to assure that in every instance, it will 
be the state that will be that permitting authority. EPA continues 
to recognize that the states are best suited to the task of 
permitting because they and their sources have experience working 
together in the state PSD program to process permit applications. 
EPA seeks to remain solely in its primary role of providing guidance 
and acting as a resource for the states as they make the various 
required permitting decisions for GHG emissions.
    Accordingly, beginning immediately we intend to work closely 
with the states--as we have already begun to do since earlier in the 
year--to help them promptly develop and submit to us their 
corrective SIP revisions that extend their PSD program to GHG-
emitting sources. Moreover, we intend to promptly act on their SIP 
submittals. Again, EPA's goal is to have each and every affected 
state have in place the necessary permitting authorities by the time 
businesses seeking construction permits need to have their 
applications processed and the permits issued--and to achieve that 
outcome by means of engaging with the states directly through a 
concerted process of consultation and support.
    EPA is taking up the additional task of proposing this FIP and 
the companion SIP Call action only because the Agency believes it is 
compelled to do so by the need to assure businesses, to the maximum 
extent possible and as promptly as possible, that a permitting 
authority is available to process PSD permit applications for GHG-
emitting sources once they become subject to PSD requirements on 
January 2, 2011.
    In order to provide that assurance, we are obligated to 
recognize, as both states and the regulated community already do, 
that there may be circumstances in which states are simply unable to 
develop and submit those SIP revisions by January 2, 2011, or for 
some period of time beyond that date. As a result, absent further 
action by EPA, those states' affected sources confront the risk that 
they may have to put on hold their plans to construct or modify, a 
risk that may have adverse consequences for the economy.
    Given these exigent circumstances, EPA proposes this plan, 
within the limits of our power, with the intent to make a back-up 
permitting authority available--and to send a signal of assurance 
expeditiously in order to reduce uncertainty and thus facilitate 
businesses' planning. Within the design of the CAA, it is EPA that 
must fill that role of back-up permitting authority. This FIP and 
the companion SIP Call action fulfill the CAA requirements to 
establish EPA in that role.
    At the same time, we propose these actions with the intent that 
states retain as much discretion as possible in the hand of the 
states. In the SIP Call rulemaking, EPA proposes that states may 
choose the deadline they consider reasonable for submission of

[[Page 2587]]

their corrective SIP revision. If, under CAA requirements, we are 
compelled to promulgate a FIP, we invite the affected state to 
accept a delegation of authority to implement that FIP, so that it 
will still be the state that processes the permit applications, 
albeit operating under federal law. In addition, if we are compelled 
to issue a FIP, we intend to continue to work closely with the state 
to assist in developing and submitting for approval its corrective 
SIP revision, so as to minimize the amount of time that the FIP must 
remain in place.

75 FR at 53890/1-2.
    In this rulemaking, we continue to have the same intentions and for 
the same reasons. Thus, we continue to believe that this action is 
necessary to ensure that sources in states with inadequate SIPs can 
obtain the necessary PSD permits for their GHG emissions. We have 
worked closely with states to establish reasonable deadlines for 
submitting revised SIPs and are finalizing this FIP based on the 
deadline agreed to by the LMAPCD. We will continue to work with states, 
including the LMAPCD, as we have done throughout the rulemaking 
process, to assist in development and expedite review of revised SIPs. 
In the meantime, however, this FIP is necessary for Jefferson County, 
Kentucky in order to provide a permitting authority until an adequate 
SIP is submitted and approved.

IV. Statutory and Executive Order Reviews

A. Executive Order 12866--Regulatory Planning and Review

    This action is not a ``significant regulatory action'' under the 
terms of Executive Order (EO) 12866 (58 FR 51735, October 4, 1993) and 
is therefore not subject to review under the EO.

B. Paperwork Reduction Act

    This action does not impose any new information collection burden. 
However, the Office of Management and Budget (OMB) has previously 
approved the information collection requirements contained in the 
existing regulations for PSD (see, e.g., 40 CFR 52.21) and title V (see 
40 CFR parts 70 and 71) under the provisions of the Paperwork Reduction 
Act, 44 U.S.C. 3501 et seq. and has assigned OMB control number 2060-
0003 and OMB control number 2060-0336 respectively. The OMB control 
numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to prepare a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements under the Administrative 
Procedure Act or any other statute unless the agency certifies that the 
rule will not have a significant economic impact on a substantial 
number of small entities. Small entities include small businesses, 
small organizations, and small governmental jurisdictions.
    For purposes of assessing the impacts of this notice on small 
entities, small entity is defined as: (1) A small business that is a 
small industrial entity as defined in the U.S. Small Business 
Administration (SBA) size standards (see 13 CFR 121.201); (2) a small 
governmental jurisdiction that is a government of a city, county, town, 
school district, or special district with a population of less than 
50,000; or (3) a small organization that is any not-for-profit 
enterprise that is independently owned and operated and is not dominant 
in its field.
    Although this rule would lead to federal permitting requirements 
for certain sources, those sources are large emitters of GHGs and tend 
to be large sources. After considering the economic impacts of this 
rule on small entities, I certify that this action will not have a 
significant economic impact on a substantial number of small entities. 
This final rule will not impose any requirements on small entities.

D. Unfunded Mandates Reform Act

    This action contains no federal mandates under the provisions of 
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA, 2 U.S.C. 
1531-1538) for state, local or tribal governments or the private 
section. The action imposes no enforceable duty on any state, local or 
tribal governments or the private sector. This action merely prescribes 
EPA's action for an area that did not meet its existing obligation for 
PSD SIP submittal. Thus, this rule is not subject to the requirements 
of sections 202 or 205 of UMRA.
    This action is also not subject to the requirements of section 203 
of UMRA because it contains no regulatory requirements that might 
significantly or uniquely affect small governments. This action merely 
prescribes EPA's action for an area that did not meet its existing 
obligation for PSD SIP submittal.

E. Executive Order 13132--Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the states, on the relationship between 
the national government and the states, or on the distribution of power 
and responsibilities among the various levels of government, as 
specified in Executive Order 13132. This action merely prescribes EPA's 
action for an area that did not meet its existing obligation for GHG 
PSD SIP submittal. Thus, Executive Order 13132 does not apply to this 
action.
    In the spirit of Executive Order 13132, and consistent with EPA 
policy to promote communications between EPA and state and local 
governments, EPA specifically solicited comment on the proposal for 
this action from state and local officials.

F. Executive Order 13175--Consultation and Coordination With Indian 
Tribal Governments

    This action does not have tribal implications, as specified in 
Executive Order 13175 (65 FR 67249, November 9, 2000). This action does 
not impose a FIP in any tribal area. Thus, Executive Order 13175 does 
not apply to this action.

G. Executive Order 13045--Protection of Children From Environmental 
Health Risks and Safety Risks

    EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying 
only to those regulatory actions that concern health or safety risks, 
such that the analysis required under section 5-501 of the EO has the 
potential to influence the regulation. This action is not subject to EO 
13045 because it merely prescribes EPA's action for an area that did 
not meet its existing obligation for PSD SIP submittal.

H. Executive Order 13211--Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use

    This action is not a ``significant energy action'' as defined in 
Executive Order 13211 (66 FR 28355 (May 22, 2001)), because it is not 
likely to have a significant adverse effect on the supply, 
distribution, or use of energy. This action merely prescribes EPA's 
action for an area that did not meet its existing obligation for PSD 
SIP submittal.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note) 
directs EPA to use voluntary consensus standards in its regulatory 
activities unless to do so would be inconsistent with applicable law or 
otherwise impractical. Voluntary consensus standards are technical 
standards (e.g., materials specifications, test methods, sampling 
procedures, and business practices) that are developed or adopted by 
voluntary consensus standards

[[Page 2588]]

bodies. NTTAA directs EPA to provide Congress, through OMB, 
explanations when the Agency decides not to use available and 
applicable voluntary consensus standards.
    This rulemaking does not involve technical standards. Therefore, 
EPA did not consider the use of any voluntary consensus standards.

J. Executive Order 12898--Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898 (59 FR 7629, February 16, 1994) establishes 
federal executive policy on environmental justice. Its main provision 
directs federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States.
    EPA has determined that this final rule will not have 
disproportionately high and adverse human health or environmental 
effects on minority or low-income populations because it does not 
affect the level of protection provided to human health or the 
environment. This rule merely prescribes EPA's action for an area that 
did not meet its existing obligation for PSD SIP submittal.

K. Determination Under Section 307(d)

    Pursuant to section 307(d)(1)(B) of the CAA, this action is subject 
to the provisions of section 307(d). Section 307(d)(1)(B) provides that 
the provisions of section 307(d) apply to ``the promulgation or 
revision of an implementation plan by the Administrator under section 
110(c) of this Act.''

L. Congressional Review Act

    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 rule 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 does not constitute a ``major rule'' as defined 
by 5 U.S.C. 804(2). Therefore, this action will be effective January 
14, 2011.

V. Judicial Review

    Section 307(b)(1) of the CAA specifies which Federal Courts of 
Appeal have jurisdiction to hear petitions for review of which final 
actions by EPA. This section provides, in part, that petitions for 
review must be filed in the Court of Appeals for the District of 
Columbia Circuit: (i) When the agency action consists of ``nationally 
applicable regulations promulgated, or final actions taken, by the 
Administrator,'' or (ii) when such action is locally or regionally 
applicable, if ``such action is based on a determination of nationwide 
scope or effect and if in taking such action the Administrator finds 
and publishes that such action is based on such a determination.''
    This rule is nationally applicable under CAA section 307(b)(1). It 
is merely the next step in the suite of rules addressing inadequacies 
in SIPs related to 13 states' failure to apply PSD to GHG-emitting 
sources as the SIP Call, the Finding of Failure to Submit issued on 
December 29, 2010, and the FIP rule issued on December 30, 2010. In 
particular, this rule simply follows-up on the FIP rule issued on 
December 30, 2010, which affected seven states that chose the earliest 
possible deadline, and takes the identical next step for Jefferson 
County now that this area, too, has missed its SIP Call deadline and is 
subject to a Finding of Failure to Submit, and FIP. The circumstances 
that have led to this rulemaking are national in scope and are 
substantially the same for Jefferson County, Kentucky as they were for 
each of the seven affected states in the earlier FIP rule issued on 
December 30, 2010. They include EPA's promulgation of nationally 
applicable GHG requirements that, in conjunction with the operation of 
the CAA PSD provisions, have resulted in GHG-emitting sources becoming 
subject to PSD; as well as EPA's finding of substantial SIP inadequacy, 
imposition of a SIP call, and establishment of a deadline for SIP 
submittal. Moreover, in this rule, EPA is applying the same uniform 
principles for promulgating the FIP for Jefferson County, Kentucky as 
it did for each of the seven earlier-affected states, concerning, e.g., 
timing (that is, that EPA is promulgating the FIP for each affected 
state immediately) and scope (that is, that EPA is applying the FIP for 
GHG-emitting sources). The FIP for Jefferson County has substantially 
the same, if not identical, terms as the FIP for each affected state in 
the December 30, 2010 rule. This rulemaking action is supported by the 
same single administrative record as the earlier December 30, 2010 FIP 
rule, and does not involve factual questions unique to Jefferson 
County, Kentucky or the LMAPCD. In addition, as stated above, this rule 
is part of a single approach to correcting certain inadequacies in SIPs 
in multiple States across the country, and in several judicial 
circuits.
    For similar reasons, this rule is based on determinations of 
nationwide scope or effect. For Jefferson County, Kentucky, EPA is 
determining that it is appropriate to promulgate the FIP immediately 
and to apply it to GHG-emitting sources, but not other sources, in the 
same way it made the same determination for the seven other states in 
the earlier December 30, 2010 FIP rule. These determinations are the 
same for each of the states. The provisions of this FIP are also 
substantially the same, if not identical, to those for the seven 
earlier affected states. Moreover, EPA is making these determinations 
and promulgating this action within the context of nationwide 
rulemakings and interpretation of the applicable CAA provisions, as 
noted above.
    Thus, under section 307(b)(1) of the Act, judicial review of this 
final action is available by filing of a petition for review in the 
U.S. Court of Appeals for the District of Columbia Circuit by March 15, 
2011. Any such judicial review is limited to only those objections that 
were raised with reasonable specificity in timely comments. Under 
section 307(b)(2) of the Act, the requirements of this final action may 
not be challenged later in civil or criminal proceedings brought by us 
to enforce these requirements.

VI. Statutory Authority

    The statutory authority for this action is provided by sections 
110, 165, 301, and 307(d)(1)(B) of the CAA as amended (42 U.S.C. 7410, 
7475, 7601, and 7407(d)(1)(B)). This action is subject to section 
307(d) of the CAA (42 U.S.C. 7407(d)).

List of Subjects in 40 CFR Part 52

    Air pollution control, Carbon dioxide, Carbon dioxide equivalents, 
Carbon monoxide, Environmental protection, Greenhouse gases, 
Hydrofluorocarbons, Incorporation by reference, Intergovernmental 
relations, Lead, Methane, Nitrogen dioxide, Nitrous oxide, Ozone, 
Particulate matter, Perfluorocarbons, Reporting and recordkeeping 
requirements, Sulfur

[[Page 2589]]

hexafluoride, Sulfur oxides, Volatile organic compounds.

    Dated: January 10, 2011.
Lisa P. Jackson,
Administrator.
    For the reasons set out in the preamble, title 40, chapter I of the 
Code of Federal Regulations is revised 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.

0
2. Section 52.37 is amended by revising paragraph (b)(6) and adding 
paragraph (b)(7) to read as follows:

Sec.  52.37  What are the requirements of the Federal Implementation 
plans (FIPs) to issue permits under the Prevention of Significant 
Deterioration requirements to sources that emit greenhouse gases?

* * * * *
    (b) * * *
    (6) Wyoming;
    (7) Jefferson County, Kentucky.
* * * * *
[FR Doc. 2011-768 Filed 1-13-11; 8:45 am]
BILLING CODE 6560-50-P