[Federal Register Volume 65, Number 203 (Thursday, October 19, 2000)]
[Proposed Rules]
[Pages 62675-62677]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-26903]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[MD107-3059; FRL-6888-1]


Approval and Promulgation of Air Quality Implementation Plans; 
Maryland; New Source Review Regulations

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to grant limited approval of a State 
Implementation Plan (SIP) revision submitted by the State of Maryland 
pursuant to the requirements of the Clean Air Act (CAA). This revision 
requires major new sources and major modifications to existing sources 
of volatile organic compounds (VOCs), and nitrogen oxides ( 
NOX) to meet certain new source review permitting 
requirements if they are proposing to locate or are located within the 
State of Maryland. These NSR requirements apply not only in those 
portions of Maryland designated as ozone nonattainment areas, but 
throughout the State of Maryland as the entire state is located within 
the Ozone Transport Region (OTR). The intended effect of this action is 
two-fold. First, it withdraws the rulemaking action proposing limited 
approval/disapproval of Maryland's NSR regulations published by EPA on 
May 25, 1994. Secondly, it proposes limited approval of Maryland's NSR 
regulations as Maryland has amended those regulations to correct the 
deficiencies noted in EPA's May 25, 1994 proposal.

DATES: Comments must be received on or before November 9, 2000.

ADDRESSES: Comments may be mailed to Makeba Morris, Chief, Permits and 
Technical Assessment Branch, Mailcode 3AP11, U.S. Environmental 
Protection Agency, Region III, 1650 Arch Street, Philadelphia, 
Pennsylvania 19103. Copies of the documents relevant to this action are 
available for public inspection during normal business hours at the Air 
Protection Division, U.S. Environmental Protection Agency, Region III, 
1650 Arch Street, Philadelphia, Pennsylvania 19103, and at the Maryland 
Department of the Environment, 2500 Broening Highway, Baltimore, 
Maryland 21224.

FOR FURTHER INFORMATION CONTACT: Perry R. Pandya, Mailcode 3AP11, U.S. 
Environmental Protection Agency, Region III, 1650 Arch Street, 
Philadelphia, Pennsylvania 19103, (215) 814-2167.

SUPPLEMENTARY INFORMATION:

I. New Source Requirements and Maryland's SIP Revision

    The CAA requires that all states submit revisions to their State 
Implementation plans (SIPs) requiring major new and major modified 
sources to meet certain new source review (NSR) requirements if they 
are located (or are proposing to locate) in areas designated 
nonattainment for a pollutant, or, in the case of VOC or NOX 
sources, in the OTR. This requirement for a SIP revision applies to 
Maryland, which currently has areas designated nonattainment for ozone 
(a pollutant formed under certain meteorological conditions from 
precursor VOC and NOX emissions). Additionally, the entire 
State of Maryland is located within the OTR.
    On June 8, 1993, Maryland submitted a revision to its SIP requiring 
new major sources and major modifications of VOCs and NOX to 
meet certain NSR requirements. On May 25, 1994, EPA proposed limited 
approval/disapproval of that SIP revision (59 FR 26994). At that time, 
EPA identified a number of deficiencies with Maryland's NSR regulations 
which the state would have to correct in order for EPA to grant final 
approval of its NSR regulations. The only comments submitted pursuant 
to EPA's May 25, 1994 proposal came from the State of Maryland.
    On September 25, 2000, the State of Maryland submitted a revision 
to its SIP which consists of amendments to its NSR regulations. Those 
amendments were made to satisfy the deficiencies cited by EPA in its 
May 25, 1994 proposal.
    EPA has determined that Maryland's NSR regulations, as amended and 
submitted on September 25, 2000, correct those deficiencies. For a 
detailed analysis of the deficiencies and how they were corrected, 
please refer to the Technical Support Documents in the Administrative 
Record. Therefore, EPA has determined that the NSR regulations 
submitted by the State of Maryland as a SIP revision on June 8, 1993 in 
conjunction with the amendments to those regulations submitted as a SIP 
revision on September 25, 2000 satisfy the CAA and its associated NSR 
regulations and policies.
    A detailed description of federal NSR requirements, Maryland's NSR 
regulations, the deficiencies of the those regulations, and specific 
corrections that Maryland had to make to those NSR regulations were 
provided in EPA's May 25, 1994 proposed rulemaking notice (59 FR 26994) 
and shall not be restated here. Maryland's only amendments to its NSR 
regulations, as submitted on September 25, 2000, were those necessary 
to address the deficiencies cited by EPA in its May 25, 1994 proposed 
rulemaking notice. Rather than proceed to final action, however, given 
the length of time that has transpired since that proposed action, EPA 
believes it is prudent to withdraw the May 25, 1994 proposed limited 
approval/disapproval and to re-propose limited approval of Maryland's 
NSR regulations.

II. Why EPA is Proposing Limited Versus Full Approval of Maryland's 
NSR Regulations

    Although the following explanation for EPA proposing limited 
approval was provided in the May 25, 1994 proposal, given that EPA is 
re-proposing limited approval at this time, it is being restated here.
    The Code of Maryland Regulations at COMAR 26.11.17.04E provides 
that emissions reductions achieved by shutting down an existing source 
or permanently curtailing productions or operating hours below baseline 
levels are creditable if the reductions are permanent, quantifiable, 
and federally enforceable, and only if such reductions occurred on or 
after January 1, 1991. However, existing EPA regulations also provide 
that if a state does not have an EPA-approved attainment demonstration, 
then post-January 1, 1991 reductions achieved by a shutdown or 
curtailment of production or operating hours are only creditable if the 
state is current in its attainment planning obligations. See 54 FR 
27286 (June 28, 1989). EPA's current rules also require that even in 
nonattainment areas with approved attainment demonstrations, only those 
shutdown or curtailment credits generated after the date of permit 
application are creditable. See 40 CFR part 51, appendix S.
    Maryland's revised NSR regulation affirmatively allows persons 
seeking to build new major sources or major modifications to take 
credit for emission reductions resulting from shutdowns or curtailments 
of production or operating hours if those shutdowns or curtailments 
occurred after January 1, 1991. Because Maryland's regulation allows 
persons seeking to construct new

[[Page 62676]]

major sources or major modifications in a nonattainment area for which 
EPA has not approved an attainment plan to take credit for shutdowns or 
curtailments which occurred prior to the date they filed their permit 
application, Maryland's NSR regulation appears not to conform with the 
existing EPA prohibition on the use of pre-application shutdown or 
curtailment credits in nonattainment areas for which EPA has not 
approved an attainment plan. This prohibition is found at 40 CFR 
51.165(a)(3)(ii)(C)(2).
    On July 23, 1996, EPA published in the Federal Register a 
comprehensive rulemaking which proposed significant changes to the 
current NSR rules. This proposed rulemaking is hereinafter referred to 
as the ``NSR Reform Rulemaking.'' See 61 FR 38250. The NSR Reform 
Rulemaking proposes to revise regulations for the approval and 
promulgation of SIPs and the requirements for preparation, adoption, 
and submittal of implementation plans governing the NSR programs 
mandated by parts C and D of Title I of the CAA. Specifically, section 
VII. A. of EPA's NSR Reform Rulemaking, entitled ``Emissions Credits 
Resulting From Source Shutdowns and Curtailments,'' proposes to 
eliminate the current restrictions on crediting of emissions reductions 
from source shutdowns and curtailments that occurred after 1990. In the 
NSR Reform Rulemaking, EPA proposes two different alternatives for 
eliminating the prior shutdown prohibition. The second of these 
alternatives, entitled ``Shutdown Alternative 2,'' generally lifts the 
current offset restriction applicable to emissions reductions from 
source shutdowns and source curtailments for all nonattainment areas 
and all pollutants where such reductions occur after the base year of 
the emissions inventory used (or to be used) to meet the applicable 
provisions of part D of the CAA. See proposed section 
51.165(a)(3)(ii)(C)(5), Alternative 2, 61 FR 38314. Under this 
alternative, states could allow emissions reductions from source 
shutdowns or curtailments to be used as offsets in all nonattainment 
areas and for all pollutants provided such reductions occurred after 
the base year of the emissions inventory used by the state to meet the 
applicable provisions of part D of the CAA. As explained above, 
Maryland's NSR rule allows sources to take credit for emissions 
reductions from shutdowns or curtailments of production or operating 
hours which occurred after January 1, 1991. This is consistent with 
Alternative 2 of EPA's NSR Reform Rulemaking, which credits only those 
emissions reductions from source shutdowns and curtailments occurring 
after 1990, i.e., the base year of the emissions inventory used to meet 
the applicable provisions of part D of the CAA. Thus, EPA believes that 
Maryland's NSR regulation is generally consistent with ``Shutdown 
Alternative 2'' as described in EPA's proposed NSR Reform Rulemaking, 
because both Maryland's rule and Alternative 2 allow sources to take 
credit only from emission reductions or curtailments occurring after 
January 1, 1991. Because Maryland's NSR regulation is generally 
consistent with Alternative 2 of EPA's proposed NSR Reform Rulemaking 
(as discussed above), and because approval of the revised version of 
Maryland's NSR regulation submitted on June 8, 1993 and as amended on 
September 25, 2000 would strengthen the SIP to be consistent with the 
CAA's provisions for NSR, EPA believes that Maryland's revised NSR 
regulation warrants limited approval. If EPA promulgates Alternative 2, 
this limited approval would convert to a full approval.
    The alternative shutdown related provision set forth in EPA's NSR 
Reform Rulemaking proposal is entitled ``Shutdown Alternative 1.'' This 
alternative proposes, for ozone nonattainment areas, to lift the 
current offset restriction applicable to emissions reductions from 
source shutdowns and curtailments in such areas without EPA-approved 
attainment demonstrations, provided the emissions reductions occur 
after November 15, 1990 and the area has kept current with the CAA's 
scheduled part D ozone nonattainment planning requirements. See 
proposed section 51.165(a)(3)(ii)(C)(5) and (6), Alternative 1.
    EPA acknowledges that either Alternative 1 or 2 may be eventually 
incorporated into the final NSR Reform Rulemaking upon its final 
promulgation. It is also noted that while EPA is, with this rulemaking, 
proposing to grant limited approval of Maryland's NSR regulation based 
on the rule's consistency with Shutdown Alternative 2 in EPA's NSR 
Reform rulemaking, the state may need to amend its NSR regulation if 
Shutdown Alternative 1 rather than Shutdown Alternative 2 is 
promulgated. If Alternative 1 is promulgated, EPA would determine the 
status of Maryland's conformance with part D ozone planning 
requirements for any nonattainment area. If Maryland's SIP were not 
current with the part D ozone planning requirements for any 
nonattainment area, EPA would make a SIP call for Maryland to amend its 
NSR rule to conform with Alternative 1 as provided in EPA's final NSR 
Reform Rulemaking.
    Maryland's regulation does not state that any emission reductions 
must also have occurred after the base year of the emissions inventory 
most recently used (or to be used) to meet the applicable provisions of 
part D of the CAA. If an area in Maryland is designated as a new 
nonattainment area in the future, the baseline year of the inventory 
used in the attainment demonstration for that area would likely be 
after the January 1, 1991 baseline year used for areas designated as 
nonattainment at the time of the 1990 CAA amendments. Because Maryland 
does not state in its NSR regulation that any emission reductions must 
also have occurred after the base year of the emissions inventory most 
recently used (or to be used) to meet the applicable provisions of part 
D of the CAA, Maryland would have to modify its NSR rule if, in the 
future, Maryland is required to do a new attainment demonstration 
because a new area in Maryland is designated as nonattainment or the 
attainment demonstration for any current nonattainment area is revised 
to use a base year emission inventory other than 1990.

III. Proposed Action

    Maryland's only amendments to its NSR regulations, as submitted on 
September 25, 2000, were those necessary to address the deficiencies 
cited by EPA in its May 25, 1994 proposal. Rather than proceed to grant 
final limited approval, however, given the length of time that has 
transpired since that proposed action, EPA believes it is prudent to 
withdraw the May 25, 2000 proposed limited approval/disapproval (FR 59 
26994) and to re-propose limited approval of Maryland's NSR 
regulations.
    EPA is hereby withdrawing the limited approval/disapproval action 
of Maryland's NSR SIP revision that was published in the Federal 
Register on May 25, 1994 (FR 59 26994). EPA is re-proposing limited 
approval. Such approval would strengthen the SIP for meeting the NSR 
requirements of the CAA. Because Maryland's NSR regulations are 
generally consistent with Alternative 2 of EPA's proposed NSR Reform 
Rulemaking (as discussed above), and because approval of the revised 
version of Maryland's NSR regulations submitted on June 8, 1993 and 
September 25, 2000 would strengthen the SIP to be consistent with the 
CAA's provisions for NSR, EPA believes that Maryland's revised NSR 
regulations warrants limited approval. If EPA promulgates Alternative 
2, this

[[Page 62677]]

limited approval would convert to a full approval.
    Written comments must be received on or before November 9, 2000. 
EPA calls your attention to the November 9, 2000 deadline date for 
submittal of comments on this proposed action to grant limited approval 
of this SIP revision submitted by the State of Maryland. The EPA is 
providing a shortened time period for comment for two reasons. As an 
initial matter, this revision is non-controversial and EPA does not 
expect comment as we proposed approval of it previously and got 
comments only from the State of Maryland. Maryland's recent revisions 
were done simply to correct the deficiencies noted in our previous 
proposed action. Moreover, this SIP revision is necessary for full 
approval of the attainment demonstration SIP for the Metropolitan 
Washington, D.C. ozone nonattainment area. The EPA is currently under 
an obligation to complete rulemaking by November 15, 2000 fully 
approving the attainment demonstration for the Metropolitan Washington, 
D.C. ozone nonattainment area or, in the alternative, proposing a 
Federal implementation plan.

IV. Administrative Requirements

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
proposed action is not a ``significant regulatory action'' and 
therefore is not subject to review by the Office of Management and 
Budget. This proposed action merely approves state law as meeting 
federal requirements and imposes no additional requirements beyond 
those imposed by state law. Accordingly, the Administrator certifies 
that this proposed rule will not have a significant economic impact on 
a substantial number of small entities under the Regulatory Flexibility 
Act (5 U.S.C. 601 et seq.). Because this rule proposes to approve pre-
existing requirements under state law and does not impose any 
additional enforceable duty beyond that required by state law, it does 
not contain any unfunded mandate or significantly or uniquely affect 
small governments, as described in the Unfunded Mandates Reform Act of 
1995 (Public Law 104-4). For the same reason, this proposed rule also 
does not significantly or uniquely affect the communities of tribal 
governments, as specified by Executive Order 13084 (63 FR 27655, May 
10, 1998). This proposed rule 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 
(64 FR 43255, August 10, 1999), because it merely approves a state rule 
implementing a federal standard, and does not alter the relationship or 
the distribution of power and responsibilities established in the Clean 
Air Act. This proposed rule also is not subject to Executive Order 
13045 (62 FR 19885, April 23, 1997), because it is not economically 
significant. In reviewing SIP submissions, EPA's role is to approve 
state choices, provided that they meet the criteria of the Clean Air 
Act. In this context, in the absence of a prior existing requirement 
for the State to use voluntary consensus standards (VCS), EPA has no 
authority to disapprove a SIP submission for failure to use VCS. It 
would thus be inconsistent with applicable law for EPA, when it reviews 
a SIP submission, to use VCS in place of a SIP submission that 
otherwise satisfies the provisions of the Clean Air Act. Thus, the 
requirements of section 12(d) of the National Technology Transfer and 
Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. As required 
by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), 
in issuing this proposed rule, EPA has taken the necessary steps to 
eliminate drafting errors and ambiguity, minimize potential litigation, 
and provide a clear legal standard for affected conduct. EPA has 
complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by 
examining the takings implications of the rule in accordance with the 
``Attorney General's Supplemental Guidelines for the Evaluation of Risk 
and Avoidance of Unanticipated Takings'' issued under the executive 
order. This proposed rule to grant limited approval of Maryland's NSR 
regulations does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et 
seq.).

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Hydrocarbons, 
Ozone, Reporting and recordkeeping requirements.

    Authority: 42 U.S.C. 7401-7671q.

    Dated: October 13, 2000.
Thomas Voltaggio,
Acting Regional Administrator, Region III.
[FR Doc. 00-26903 Filed 10-18-00; 8:45 am]
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