[Federal Register Volume 69, Number 29 (Thursday, February 12, 2004)]
[Proposed Rules]
[Pages 7098-7103]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-3078]



  Federal Register / Vol. 69, No. 29 / Thursday, February 12, 2004 / 
Proposed Rules  

[[Page 7098]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[CA269-0438a; FRL-7621-1]


Revisions to the California State Implementation Plan, San 
Joaquin Valley Unified Air Pollution Control District

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to approve certain revisions to the San 
Joaquin Valley Unified Air Pollution Control District (SJVUAPCD) 
portion of the California State Implementation Plan (SIP). These 
revisions concern oxides of nitrogen (NOX) emissions from 
boilers, steam generators, and process heaters; stationary internal 
combustion engines; and stationary gas turbines. We are proposing to 
approve local rules to regulate these emission sources under the Clean 
Air Act as amended in 1990 (CAA or the Act). We are taking comments on 
this proposal and plan to follow with a final action.

DATES: Any comments must arrive by March 15, 2004.

ADDRESSES: Send comments to Andy Steckel, Rulemaking Office Chief (AIR-
4), U.S. Environmental Protection Agency, Region IX, 75 Hawthorne 
Street, San Francisco, CA 94105-3901 or e-mail to 
[email protected], or submit comments at http://www.regulations.gov.
    You can inspect copies of the submitted SIP revisions, EPA's 
technical support documents (TSDs), and public comments at our Region 
IX office during normal business hours by appointment. You may also see 
copies of the submitted SIP revisions by appointment at the following 
locations:

California Air Resources Board, Stationary Source Division, Rule 
Evaluation Section, 1001 ``I'' Street, Sacramento, CA 95814.
San Joaquin Valley Unified Air Pollution Control District, 1990 E. 
Gettysburg Avenue, Fresno, CA 93726.

    A copy of the rules may also be available via the Internet at 
http://www.arb.ca.gov/drdb/drdbltxt.htm. Please be advised that this is 
not an EPA website and may not contain the same versions of the rules 
that were submitted to EPA.

FOR FURTHER INFORMATION CONTACT: Thomas C. Canaday, EPA Region IX, 
(415) 947-4121, [email protected].

SUPPLEMENTARY INFORMATION: Throughout this document, ``we,'' ``us'' and 
``our'' refer to EPA.

Table of Contents

I. The State's Submittal
    A. What Rules did the State Submit?
    B. Are There Other Versions of These Rules?
    C. What Is the Purpose of the Submitted Rule Revisions?
II. Background
III. EPA's Evaluation and Action
    A. How Is EPA Evaluating the Rules?
    B. Do the Rules Meet the Evaluation Criteria?
    C. Public Comment and Final Action.
IV. Statutory and Executive Order Reviews

I. The State's Submittal

A. What Rules Did the State Submit?

    Table 1 lists the rules addressed by this proposal with the dates 
that they were adopted by the local air agency and submitted by the 
California Air Resources Board (CARB).

                                            Table 1.--Submitted Rule
----------------------------------------------------------------------------------------------------------------
            Local agency             Rule            Rule title              Adopted        Submitted
----------------------------------------------------------------------------------------------------------------
 SJVUAPCD..........................            4351  Boilers, Steam Generators,         08/21/03        09/29/03
                                                      and Process Heaters--Phase
                                                      1.
 SJVUAPCD..........................            4305  Boilers, Steam Generators,         08/21/03        09/29/03
                                                      and Process Heaters--Phase
                                                      2.
 SJVUAPCD..........................            4306  Boilers, Steam Generators,         09/18/03        09/29/03
                                                      and Process Heaters--Phase
                                                      3.
 SJVUAPCD..........................            4701  Internal Combustion Engines-       08/21/03        10/09/03
                                                      -Phase 1.
 SJVUAPCD..........................            4702  Internal Combustion Engines-       08/21/03        10/09/03
                                                      -Phase 2.
 SJVUAPCD..........................            4703  Stationary Gas Turbines....        04/25/02        06/18/02
----------------------------------------------------------------------------------------------------------------

    On November 10, 2003, submitted Rules 4351, 4305, 4306, 4701, and 
4702 were found to meet the completeness criteria in 40 CFR Part 51 
Appendix V, which must be met before formal EPA review. Submitted Rule 
4703 was found to meet the completeness criteria on July 23, 2002.

B. Are There Other Versions of These Rules?

    SJVUAPCD adopted an earlier version of Rule 4351 on October 19, 
1995, and CARB submitted it to us on March 26, 1996. SJVUAPCD adopted 
an earlier version of Rule 4305 on December 19, 1996, and CARB 
submitted it to us on March 3, 1997. SJVUAPCD adopted an earlier 
version of Rule 4701 on December 19, 1996, and CARB submitted it to us 
on March 10, 1998. SJVUAPCD adopted an earlier version of Rule 4703 on 
October 16, 1997, and CARB submitted it to us on March 10, 1998. We 
proposed a limited approval and limited disapproval of these previous 
versions of Rules 4351, 4305, 4701, and 4703 on September 14, 1998 (63 
FR 49053) and finalized our limited approval and limited disapproval of 
these rules into the SIP on February 28, 2002 (67 FR 9209).
    Between the time of our proposed rule in 1998 and our final rule in 
2002, SJVUAPCD adopted an amended version of Rule 4701 on November 12, 
1998, which CARB submitted on February 16, 1999. Subsequent to our 
final rule in 2002, SJVUAPCD adopted amended versions of Rule 4701 and 
Rule 4305 on December 19, 2002, and CARB submitted these to us on 
January 21, 2003. We have not taken action on these interim submittals 
of amended Rule 4701 and Rule 4305 and consider the current submitted 
versions of Rule 4701 and Rule 4305, identified in Table 1, to 
supercede the versions submitted to us previously. While we can act on 
only the most recently submitted versions of submitted rules, we have 
reviewed materials provided with previous submittals. There are no 
previously submitted versions of Rules 4306 and 4702.

C. What Is the Purpose of the Submitted Rule Revisions?

    NOX helps produce ground-level ozone, smog and 
particulate matter, which harm human health and the environment. 
Specifically, NOX is a precursor pollutant of the following 
``criteria'' pollutants for which national ambient air quality 
standards (NAAQS) have been established: nitrogen dioxide,

[[Page 7099]]

ozone, and particulate matter (PM-10 and PM-2.5). Section 110(a) of the 
CAA requires States to submit regulations that control NOX 
emissions.
    Rules 4351, 4305, and 4306 limit NOX and carbon monoxide 
(CO) emissions from all gaseous fuel or liquid fuel fired boilers, 
steam generators, and process heaters with a rated heat input greater 
than five million Btu per hour. Rules 4701 and 4702 limit 
NOX, CO, and volatile organic compound (VOC) emissions from 
stationary internal combustion engines with a rated brake horsepower 
greater than 50 horsepower. Rule 4701 applies to both spark-ignited and 
compression-ignited stationary internal combustion engines while Rule 
4702 applies only to spark-ignited stationary internal combustion 
engines. Rule 4703 limits NOX emissions from all stationary 
gas turbine systems which are subject to district permitting 
requirements and with ratings equal to or greater than 0.3 megawatt 
(MW) and/or a maximum heat input rating of more that three million Btu 
per hour. Stationary gas turbines in the San Joaquin Valley Area are 
used mostly as cogeneration units to supply steam and electricity for 
oil production and industrial processes.
    The general purpose of the submitted rules is to reduce emissions 
of NOX and other pollutants from three specific source 
categories (boilers, steam generators, and process heaters; stationary 
internal combustion engines; and stationary gas turbines) in San 
Joaquin Valley. More specifically, the particular versions of these 
submitted rules were adopted by SJVUAPCD and submitted by CARB to EPA 
to address deficiencies identified by EPA in prior versions of the 
rules and to address the additional planning requirements imposed under 
the Act on PM-10 nonattainment areas, such as San Joaquin Valley, that 
are classified as ``serious,'' as discussed further in the following 
section.

II. Background

    On September 14, 1998, EPA published a notice of proposed 
rulemaking for a limited approval and limited disapproval action 
(``1998 Proposed Rule'') on SJVUAPCD Rules 4351, 4305, 4701 and 4703 
that were submitted as revisions to the California SIP because, 
although we determined that these rules improved the SIP and were 
largely consistent with the relevant CAA requirements, we also 
determined that some provisions in these rules conflicted with section 
110 and part D (of title I) of the Act. See 63 FR 49053. EPA extended 
the 30-day comment period for the 1998 Proposed Rule for an additional 
30 days. See 63 FR 56881 (October 23, 1998). Upon consideration of 
comments received on the 1998 Proposed Rule, we determined that certain 
proposed deficiencies were not a basis for a limited disapproval but 
otherwise finalized the action as proposed. We published notice of our 
final rule in the Federal Register on February 28, 2002 (``2002 Final 
Rule''). See 67 FR 9209. The provisions deemed deficient can be placed 
in two basic categories, the Westside exemption and all other 
deficiencies.
    Westside exemption: The rules contained an exemption from 
regulation, or federal enforceability of the regulation, for facilities 
west of Interstate Highway 5 in Fresno, Kern, or Kings County (referred 
to herein as the ``Westside exemption''). The rationale for our limited 
disapproval with respect to the Westside exemption is set forth in the 
1998 Proposed Rule: (1) Reasonably Available Control Measures (RACM) 
are required of major stationary sources of PM-10 precursors (including 
NOX) under section 189(e) of the Act unless EPA determines 
that such sources do not contribute significantly to PM-10 levels, (2) 
EPA has concluded that the PM-10 attainment strategy for San Joaquin 
Valley will rely heavily on the control of precursors to PM-10, 
including NOX, (3) the Westside exemption constitutes 
failure to implement RACM at these facilities as required under section 
189(a)(1)(C) of the Act, and (4) section 110(l) of the Act forbids EPA 
from approving SIP revisions which would interfere with any applicable 
requirement of the Act, including section 189(a)(1)(C). See 63 FR 
49053, at 49055 (September 14, 1998).
    In response to a comment on our 1998 Proposed Rule, we cited a 
document, SJVUAPCD's PM-10 Attainment Demonstration Plan Progress 
Report 1997-1999 (``PM-10 Progress Report''), as further support for 
our conclusion about NOX as a significant precursor to PM-10 
in San Joaquin Valley. We acknowledge that the PM-10 Progress Report 
was received by us subsequent to the close of the comment period and 
that the public had no opportunity to challenge its contents or our use 
of the report prior to our final action. However, our reference to the 
PM-10 Progress Report was in response to a comment and was intended 
merely to supplement, rather than replace, the original basis for our 
conclusion that NOX is a significant precursor for PM-10. In 
our 1998 Proposed Rule, we supported this conclusion by reference to a 
previous Federal Register notice (i.e., 58 FR 3337), and in that 
previous notice, we summarized the findings of SJVUAPCD's 1991 Moderate 
PM-10 Plan as follows:

The EPA is reclassifying the San Joaquin nonattainment area due to 
the fact that the PM-10 SIP for San Joaquin Valley submitted to EPA 
by the State of California on December 24, 1991, suggests that the 
area cannot practicably attain the PM-10 NAAQS by December 31, 1994. 
Moreover, the area has not projected attainment before the December 
31, 2001 serious area attainment date. Violations of the PM-10 NAAQS 
in the San Joaquin Valley are dominated by two source categories: 
(1) Primary PM-10 sources, including reentrained road dust, 
construction activities, and farming operations; and (2) 
secondarily-formed PM-10, including ammonium nitrate and ammonium 
sulfate. On days when primary PM-10 emissions dominate, fugitive 
dust emissions account for nearly 80 percent of the PM-10 mass. On 
days when secondary PM-10 dominates, nitrates and sulfates account 
for 63 percent of the PM-10 mass. The attainment strategy for the 
San Joaquin Valley will rely heavily on the control of widespread 
fugitive dust sources and the control of precursors of PM-10, 
including nitrogen dioxide, sulfur dioxide and volatile organic 
compounds.

    See 58 FR 3334, at 3337 (January 8, 1993).
    Another comment was submitted on the 1998 Proposed Rule stating 
that the SJVUAPCD had shown, through modeling, that the reduction of 
NOX emissions from Westside sources would not contribute to 
the attainment of the ozone NAAQS and that the Westside exemption was 
therefore consistent with CAA requirements for ozone. We responded to 
this comment by noting that, during the interval following our 1998 
Proposed Rule, San Joaquin Valley had in fact failed to attain the 
ozone NAAQS by the applicable attainment date and that this failure to 
attain, in and of itself, proved the inadequacy of the previous ozone 
modeling that supported the Westside exemption. This response was not 
necessary, and we further note that the failure to attain the ozone 
NAAQS occurred subsequent to the close of the comment period and that 
the public had no opportunity prior to our final action to challenge 
our statement regarding its relevance in connection with the underlying 
ozone modeling results supporting the Westside exemption. As stated in 
our 1998 Proposed Rule, we did not intend to make any determination in 
that rulemaking regarding the Westside exemption's consistency with 
section 182(f), which provides the statutory criteria for approving 
area-wide or subarea-specific exemptions for controls of NOX 
sources in connection with the ozone NAAQS attainment strategy. 
Instead, we intended to base our

[[Page 7100]]

determination of the deficiency of the Westside exemption solely on PM-
10 planning requirements. We hereby re-affirm that our basis in the 
1998 Proposed Rule and the 2002 Final Rule for finding the Westside 
exemption to be a deficiency derived from PM-10 planning requirements, 
not ozone planning requirements. In any event, the past issue of 
whether the Westside exemption was inconsistent with both ozone and PM-
10 planning requirements or simply PM-10 (and not ozone) planning 
requirements has become moot in light of the need for additional 
NOX emissions reductions throughout San Joaquin Valley for 
both PM-10 and ozone planning purposes.
    All Other Deficiencies: The rules contained numerous other 
deficient provisions that varied from rule to rule but which generally 
covered such issues as source applicability and exemptions; stringency 
of emissions standards; excess emissions during start-up, shutdown, and 
malfunction conditions; and monitoring and record keeping.
    In our 2002 Final Rule, we concluded that certain types of 
deficiencies, such as the emission limits and applicability thresholds, 
were inconsistent with the requirement to implement Reasonably 
Available Control Technology (RACT) for control of NOX 
emissions (as a precursor to ozone) at existing sources, as required 
under CAA section 182(b)(2) and 182(f) for moderate and above ozone 
nonattainment areas, and were inconsistent with the requirement to 
implement RACM/RACT under the statutory provisions for PM-10 
nonattainment plans cited above in connection with the Westside 
exemption. We concluded that other types of deficiencies, such as those 
related to monitoring and reporting, were inconsistent with the 
enforceability requirement for SIP rules under section 110(a)(2)(A) of 
the Act. These deficiencies are described in detail in the 1998 
Proposed Rule (63 FR 49053, September 14, 1998), the TSDs prepared in 
connection with that proposal, and the 2002 Final Rule (67 FR 9209, 
February 28, 2002).
    In 1998, when we proposed action on the previous versions of these 
rules, San Joaquin Valley was classified as a ``serious'' (i.e., one 
classification higher than ``moderate'') nonattainment area for the 
ozone NAAQS and as a ``serious'' nonattainment area for the PM-10 
NAAQS. By the time we took final action in 2002, the nonattainment 
classification for the valley with respect to the ozone NAAQS had been 
bumped-up to ``severe.'' See 50 CFR 81.305.
    San Joaquin Valley continues to be classified as a ``serious'' PM-
10 nonattainment area, and while our previous rulemaking process, which 
culminated in the 2002 Final Rule, evaluated the rules with respect to 
the ozone RACT requirement and the PM-10 RACM/RACT requirement, San 
Joaquin Valley, as a serious PM-10 nonattainment area, is also subject 
to the requirement under sections 189(b)(1)(B) and 189(e) of the Act to 
implement Best Available Control Measures (BACM), which includes Best 
Available Control Technology (BACT), for the control of PM-10 precursor 
emissions, including NOX.
    The TSDs have more information about these rules.

III. EPA's Evaluation and Action

A. How Is EPA Evaluating the Rules?

    We are evaluating the six submitted rules to determine whether they 
correct the deficiencies in the previous versions of the rules as set 
forth in our 2002 Final Rule, and thereby implement RACT under CAA 
sections 182(b)(2) and 182(f) and RACM/RACT under CAA sections 
189(a)(1)(C) and 189(e), and whether they provide for implementation of 
BACM/BACT under CAA sections 189(b)(1)(B) and 189(e) for the relevant 
source categories. General regulatory and non-regulatory references 
that we used to help evaluate enforceability, RACT/RACM, and BACM/BACT 
requirements consistently include the following:
    1. State Implementation Plans; General Preamble for the 
Implementation of Title I of the Clean Air Act Amendments of 1990, U.S. 
EPA, 57 FR 13489, April 16, 1992.
    2. State Implementation Plans; Nitrogen Oxides Supplement to the 
General Preamble for the Implementation of Title I of the Clean Air Act 
Amendments of 1990, U.S. EPA, 57 FR 55620, November 25, 1992.
    3. State Implementation Plans for Serious PM-10 Nonattainment 
Areas, and Attainment Date Waivers for PM-10 Nonattainment Areas 
Generally; Addendum to the General Preamble for the Implementation of 
Title I of the Clean Air Act Amendments of 1990, U.S. EPA, 59 FR 41998, 
August 16, 1994.
    4. Issues Relating to VOC Regulation, Cutpoints, Deficiencies, and 
Deviations (the Blue Book), U.S. EPA, May 25, 1988.
    5. ``Guidance Document for Correcting VOC Rule Deficiencies'', U.S. 
EPA Region 9, August 21, 2001 (the little bluebook).
    6. ``State Implementation Plans: Policy Regarding Excess Emissions 
during Malfunctions, Startup, and Shutdown,'' EPA policy memorandum 
from Steven A. Herman to Regional Administrators, September 20, 1999, 
and re-issuance of this memo dated December 5, 2001 (``Excess Emissions 
Policy'').
    7. Improving Air Quality with Economic Incentive Programs, U.S. EPA 
Office of Air and Radiation, EPA-452/R-01-001, January 2001 (``EIP 
Guidance'').
    8. Cost Effective Nitrogen Oxides (NOX) Reasonably 
Available Control Technology (RACT), U.S. EPA Office of Air Quality 
Planning and Standards, March 16, 1994.
    9. Determination of Reasonably Available Control Technology and 
Best Available Retrofit Control Technology for Industrial, 
Institutional, and Commercial Boilers, Steam Generators, and Process 
Heaters, State of California Air Resources Board, July 18, 1991 (``CARB 
1991 RACT/BARCT Determination'').
    10. Determination of Reasonably Available Control Technology and 
Best Available Retrofit Control Technology for the Control of Oxides of 
Nitrogen From Stationary Gas Turbines, State of California Air 
Resources Board, May 18, 1992 (``CARB 1992 RACT/BARCT Determination'').
    11. CAPCOA/ARB Proposed Determination of Reasonably Available 
Control Technology and Best Available Retrofit Control Technology for 
Stationary Internal Combustion Engines, Draft, State of California Air 
Resources Board, December, 1997 (``CARB Draft 1997 RACT/BARCT 
Determination'').
    12. Determination of Reasonably Available Control Technology and 
Best Available Retrofit Control Technology for Stationary Spark-Ignited 
Internal Combustion Engines, State of California Air Resources Board, 
November, 2001 (``CARB 2001 RACT/BARCT Determination'').

B. Do These Rules Meet the Evaluation Criteria?

    Correction of Previously-Identified Deficiencies. The deficiencies 
identified in the previous versions of the rules are described in full 
in our previous rulemaking documents, including the 1998 Proposed Rule 
(63 FR 49053, September 14, 1998), the related TSDs (dated July 31, 
1998), and the 2002 Final Rule (67 FR 9209, February 28, 2002). In the 
following paragraphs, we discuss how the new or amended rules correct 
the deficiencies by providing a discussion of each of 18 specific 
deficiencies set forth in our 2002 Final Rule (67 FR 9209, at 9210). 
The TSDs provide more detail on our evaluation.

[[Page 7101]]

    1. SJVUAPCD removed the Westside exemption from Rules 4305, 4701, 
and 4703. The Westside exemption was not removed from Rule 4351 but all 
boilers, steam generators, and process heaters covered by that rule are 
now covered by Rule 4305 in which the exemption has been removed. Also, 
the exemption was not included in new Rules 4306 and 4702.
    2. SJVUAPCD added provisions in Rule 4305 to address start-up and 
shutdown conditions, and the added provisions are consistent with EPA's 
Excess Emissions Policy. New Rule 4306 also includes satisfactory 
provisions to address start-up and shutdown conditions.
    3. By adopting new Rules 4306 and 4702, SJVUAPCD has limited or 
eliminated several types of exemptions contained in Rules 4305 and 4701 
that we found to be deficiencies. We note, however, that the exemption 
from RACT-level of control for low-use (i.e., under 1,000 hours 
annually) internal combustion engines under amended Rule 4701 now 
applies to low-use engines at major NOX sources on the 
Westside. For low-use spark-ignited engines, this exemption is 
superceded by new Rule 4702, but low-use compression-ignited (i.e. 
diesel) engines at major NOX sources on the Westside would 
continue to be exempt from RACT-level of control. As discussed further 
in our TSD on submitted Rules 4701 and 4702, we conclude that this 
issue does not prevent our full approval of amended Rule 4701 given 
that the reduction in NOX by application of RACT to low-use 
engines at major NOX sources on the Westside would amount 
only to 0.1 ton per day. We have, however, included this issue as one 
for the District to address in the next revision to the rule.
    4. SJVUAPCD has revised Rules 4305 and 4701 to specify appropriate 
averaging times for emissions concentration limits. New Rules 4306 and 
4702 also specify appropriate averaging times.
    5. SJVUAPCD has revised Rules 4351 and 4305 to include interim 
parametric monitoring in instances of deferred source testing. These 
requirements have also been extended to new Rule 4306.
    6. SJVUAPCD has revised the representative testing requirements in 
Rules 4351 and 4305 to make them consistent with EPA policy and has 
extended these requirements to new Rule 4306. SJVUAPCD has deleted the 
option of representative testing from Rule 4701 and has not included 
the option of representative testing in new Rule 4702.
    7. SJVUAPCD has deleted the alternative emission control plan 
(AECP) provisions from Rules 4305 and 4701 but has added AECP 
provisions to new Rules 4306 and 4702. The AECP provisions in new Rules 
4306 and 4702 include a 10% environmental benefit relative to the 
underlying emissions limits that would otherwise apply to each 
individual unit.
    8. SJVUAPCD has revised Rule 4351 to be consistent with Rules 4305 
and 4306 and to require physical modification of an exempted unit to 
assure its operation at or below the rule application capacity 
threshold when the unit's nameplate capacity exceeds this threshold.
    9. In our 2002 Final Rule, we withdrew our previous deficiency 
finding related to the failure in Rule 4351 to require source tests to 
be performed on units using each fuel which is allowed to be burned in 
that unit. See 67 FR 9209, at 9211 (February 28, 2002).
    10. In our 2002 Final Rule, we withdrew our previous deficiency 
finding related to the lack in Rule 4351 of source test requirements 
for certain units. See 67 FR 9209, at 9211 (February 28, 2002).
    11. SJVUAPCD has revised Rule 4701 to specify what information is 
required to be recorded and maintained as part of record keeping 
requirements. New Rule 4702 also has adequate record keeping 
requirements.
    12. SJVUAPCD has revised Rule 4701 to provide for increased 
frequency of required compliance testing, and has included similar 
provisions in new Rule 4702.
    13. SJVUAPCD has revised Rule 4701 to identify more precisely what 
operating records and support documentation are to be maintained by 
owners claiming exemption to the requirements of the rule, and has 
included similar provisions in new Rule 4702.
    14. In our 2002 Final Rule, we withdrew our previous deficiency 
finding related to the RACT compliance deadline of May 31, 2001 for 
certain internal combustion engines under Rule 4701. See 67 FR 9209, at 
9212 (February 28, 2002).
    15. SJVUAPCD has removed the AECP provisions in Rules 4305 and 4701 
but has included such provisions in new Rules 4306 and 4702. In each of 
the new rules, the AECP uses a 7-day averaging to determine compliance, 
which is more protective than the 14-day averaging period that had been 
included in Rules 4305 and 4701, and which is consistent with our 
policies, including the EIP Guidance, given the stringency of the 
underlying emissions limits that otherwise apply, the practical 
considerations involved in equipment repair, and the incorporation of 
the 10% environmental benefit into the AECP formulation of the new 
rules.
    16. SJVUAPCD has removed the AECP provisions from Rule 4701 and has 
eliminated the deficiency related to excessive director's discretion in 
specifying what method is to be used to determine the applicable 
conversion factor from fuel use to engine emissions in the AECP 
provisions of new Rule 4702 by requiring approval of equivalent methods 
by EPA, CARB, and the Air Pollution Control Officer (APCO).
    17. SJVUAPCD has removed the AECP provisions from Rule 4701 and has 
not included the calculation factor that we found to be a deficiency in 
Rule 4701 related to electric motors in the AECP provisions of new Rule 
4702.
    18. SJVUAPCD has revised Rule 4703 to refer to the appropriate 
continuous emission monitoring system requirements and reporting 
requirements in 40 CFR part 60.
    Based on our review of the six new or amended rules, we conclude 
that SJVUAPCD has adequately corrected all of the deficiencies we 
identified through our 2002 Final Rule. Nonetheless, we have identified 
several areas or items for improvement in the rules themselves or in 
the documentation for the rules. These areas or items for rule 
improvement relate to such issues as the low-use exemption from RACT 
for diesel engines located at major NOX sources on the 
Westside, the unnecessary uncertainty caused by the ``and/or'' 
formulation in the applicability subsection of amended Rule 4703, and 
the need to be more specific with respect to the contents of Emission 
Control Plans under new Rule 4306. These items or areas for improvement 
do not affect our ability to approve the submitted rules but constitute 
recommendations that we believe SJVUAPCD should address the next time 
the District revises these rules. See the TSDs for more information on 
our suggested rule improvements.
    BACM/BACT Evaluation. As noted above, San Joaquin Valley is 
classified as a ``serious'' PM-10 nonattainment area, and such areas 
are subject to the BACM/BACT requirement under CAA sections 
189(b)(1)(B) and 189(e). EPA provided its interpretation of the BACM/
BACT requirement in Addendum to the General Preamble for the 
Implementation of Title I of the Clean Air Act Amendments of 1990 (59 
FR 41998, August 16, 1994). As set forth therein, the general process 
for

[[Page 7102]]

identifying BACM/BACT in any given serious PM-10 nonattainment area 
involves developing an inventory of sources of PM-10 and PM-10 
precursors, evaluating the impact of the various source categories (to 
distinguish significant source categories for which BACM/BACT is 
required from de minimis categories for which BACM/BACT is not 
required), evaluating alternative control techniques and costs of 
control, and then selecting BACM for area sources and BACT for point 
sources.
    SJVUAPCD has provided for the first two steps listed above through 
development and adoption of the San Joaquin Valley Plan to Attain 
Federal Standards for Particulate Matter 10 microns and Smaller (``2003 
PM-10 Plan''). The 2003 PM-10 Plan was adopted locally on June 19, 
2003, and submitted by CARB to EPA by letter dated August 19, 2003. 
SJVUAPCD amended portions of the 2003 PM-10 Plan and adopted the 
amendments on December 18, 2003. CARB submitted the plan amendments to 
EPA by letter dated December 30, 2003. The 2003 PM-10 Plan, as revised 
and supplemented by the plan amendments adopted in December 2003, is 
referred to herein as the ``Amended 2003 PM-10 Plan''.
    The Amended 2003 PM-10 Plan identifies significant source 
categories for which BACM or BACT must be demonstrated. Among the 
categories identified as significant in the plan are natural gas 
boilers and natural gas oilfield steam generators, stationary internal 
combustion engines, and stationary gas turbines. (Together, these 
source categories are estimated to have emitted 67.3 tons per day of 
NOX in 1999. See Table 4-8 of the Amended 2003 PM-10 Plan.) 
Thus, the submitted rules, which apply to these significant source 
categories, must provide for BACT-level of control.
    SJVUAPCD has provided documentation for the other steps in the 
process for determining BACM/BACT for individual source categories in 
the staff reports submitted with the new or amended rules. Additional 
documentation is provided in the CARB 1991 RACT/BARCT Determination for 
boilers, steam generators, and process heaters, the 1992 CARB RACT/
BARCT Determination for stationary gas turbines, the 1997 Draft CARB 
RACT/BARCT Determination for stationary internal combustion engines, 
and the 2001 CARB RACT/BARCT Determination for spark-ignited stationary 
internal combustion engines.
    With the exception of stationary internal combustion engines used 
for agricultural purposes (discussed below) and ``small'' boilers, 
steam generators, and process heaters (also discussed below), the new 
or amended rules provide a level of control that is at least as, if not 
more, stringent than State-level Best Available Retrofit Control 
Technology (BARCT), which is equivalent to that level of control 
required to meet the Federal BACT requirement. Two de minimis 
exceptions to this finding include low-use compression-ignited (diesel) 
engines at major NOX sources on the Westside and high-use 
diesel engines at public water districts. SJVUAPCD has indicated its 
intention to address issues related to non-agricultural diesel engines 
as part of the larger rulemaking discussed below in connection with 
agricultural internal combustion engines. See letter dated January 26, 
2003, from Scott Nestor, SJVUAPCD Planning Manager to Andrew Steckel, 
U.S. EPA--Region IX. The TSD on Rules 4701 and 4702 provides more 
information on these de minimis exceptions.
    Both amended Rule 4701 and new Rule 4702 exempt internal combustion 
engines used in agriculture. These engines are typically used for 
irrigation purposes. Most such engines are compression-ignited (i.e., 
diesel) but roughly 10% are spark-ignited. The Amended 2003 PM-10 Plan 
identifies agricultural irrigation internal combustion engines as a 
significant source category, and thus, SJVUAPCD must provide for BACT-
level of control for this currently uncontrolled component of the 
source category of stationary internal combustion engines. SJVUAPCD has 
met this requirement through adoption of a control measure in the 
Amended 2003 PM-10 Plan that commits the District to implement BACT for 
agricultural internal combustion engines by removing the general 
agricultural exemption from Rule 4702 and by establishing BACT-level 
NOX emission limits in Rule 4702 for compression-ignited and 
spark-ignited agricultural internal combustion engines. We expect to 
approve this control measure into the SIP in a separate rulemaking 
action on the Amended 2003 PM-10 Plan.
    Rules 4351, 4305, and 4306 apply to boilers, steam generators, and 
process heaters with heat input ratings greater than five million Btu 
per hour. However, the Amended PM-10 Plan concludes that small boilers, 
steam generators, and process heaters (i.e., with heat input ratings 
between two and five million Btu per hour) are also a significant 
source of PM-10 precursor emissions, and thus, SJVUAPCD must provide 
BACT-level of control for them as well. SJVUAPCD has met this 
requirement by adopting a control measure that commits the District to 
implement BACT for control of NOX from these sources. We 
expect to approve this control measure into the SIP in a separate 
rulemaking action on the Amended 2003 PM-10 Plan.
    Conclusion. Therefore, we propose to find that the provisions of 
new or amended SJVUAPCD Rules 4351, 4305, 4306, 4701, 4702, and 4703 
adequately correct the previously-identified deficiencies and are 
consistent with the relevant requirements under section 110(a) and part 
D of the Clean Air Act, as amended in 1990. Specifically, we propose to 
find that the new or amended rules implement RACT as required for 
moderate and above ozone nonattainment areas under CAA sections 
182(b)(2) and 182(f), RACT/RACM as required for moderate and above PM-
10 nonattainment areas under CAA sections 189(a)(1)(C) and 189(e), and 
BACM/BACT as required for serious PM-10 nonattainment areas under CAA 
sections 189(b)(1)(B) and 189(e) for NOX emissions from the 
following existing sources or source categories: boilers, steam 
generators, and process heaters (with heat input ratings greater than 
five million Btu per hour), non-agricultural stationary internal 
combustion engines, and stationary gas turbines. Also, we propose to 
find that the new or amended rules meet the enforceability requirements 
of Section 110(a).
    As noted above, SJVUAPCD has provided for BACM/BACT level of 
control of NOX from the overall source categories by 
adoption of control measures related to small boilers, steam 
generators, and process heaters as well as agricultural stationary 
internal combustion engines. We expect to approve these control 
measures in a separate rulemaking on the Amended 2003 PM-10 Plan.
    Also, because the submitted rules are consistent with the 
assumptions and commitments for these source categories in the Amended 
2003 PM-10 Plan and the Amended 2002 and 2005 Rate of Progress Plan for 
San Joaquin Valley Ozone, as submitted by CARB to EPA on April 10, 
2003, we conclude that our approval of them as a SIP revision is 
allowed under section 110(l) of the Act. The TSDs have more information 
on our evaluation of all of the rules addressed in today's action.

C. Public Comment and Final Action

    Because EPA believes the submitted SJVUAPCD Rules 4351, 4305, 4306, 
4701, 4702, and 4703 fulfill all relevant requirements, we are 
proposing to fully

[[Page 7103]]

approve them as described in section 110(k)(3) of the Act. We will 
accept comments from the public on this proposal for the next 30 days. 
Unless we receive convincing new information during the comment period, 
we intend to publish a final approval action that will incorporate 
these rules into the federally enforceable SIP.
    If we finalize this action as proposed, then SJVUAPCD Rules 4351, 
4305, and 4306, submitted by CARB on September 29, 2003; SJVUAPCD Rules 
4701 and 4702, submitted by CARB on October 9, 2003; and SJVUAPCD Rule 
4703, submitted by CARB on June 18, 2002, will supercede SJVUAPCD Rules 
4351, 4305, 4701 and 4703, approved by EPA on February 28, 2002 into 
the SJVUAPCD portion of the California SIP. This final action would 
terminate all sanction and Federal Implementation Plan (FIP) 
implications of our February 28, 2002 final action with respect to 
these rules.

IV. Statutory and Executive Order Reviews

    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. For this reason, this action is also not subject to Executive 
Order 13211, ``Actions Concerning Regulations That Significantly Affect 
Energy Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001). This 
proposed action merely proposes to approve 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 (Pub. L. 104-4).
    This proposed rule also does not have tribal implications because 
it will not have a substantial direct effect on one or more Indian 
tribes, on the relationship between the Federal Government and Indian 
tribes, or on the distribution of power and responsibilities between 
the Federal Government and Indian tribes, as specified by Executive 
Order 13175 (65 FR 67249, November 9, 2000). This action also does not 
have Federalism implications because it does 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). This action 
merely proposes to approve 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 ``Protection 
of Children from Environmental Health Risks and Safety Risks'' (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. This proposed rule 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, Intergovernmental 
relations, Nitrogen dioxide, Ozone, Particulate matter, Reporting and 
recordkeeping requirements.

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

    Dated: February 3, 2004.
Wayne Nastri,
Regional Administrator, Region IX.
[FR Doc. 04-3078 Filed 2-11-04; 8:45 am]
BILLING CODE 6560-50-P