[Federal Register Volume 69, Number 43 (Thursday, March 4, 2004)]
[Rules and Regulations]
[Pages 10161-10165]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-4814]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[AZ-082-0072; FRL-7626-1]


Approval and Promulgation of Implementation Plans; Arizona--
Maricopa County Ozone, PM-10 and CO Nonattainment Areas; Approval of 
Revisions to Maricopa County Area Cleaner Burning Gasoline Program

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: We are approving revisions to the Arizona Cleaner Burning 
Gasoline

[[Page 10162]]

(CBG) program currently approved in the State implementation plan 
(SIP). Specifically, we are approving revisions that, among other 
changes, replace Arizona's interim CBG program with a permanent 
program, amend the wintertime CBG program to limit the types of 
gasoline that may be supplied, and remove the minimum oxygen content 
requirement for summertime gasoline.

EFFECTIVE DATE: April 5, 2004.

ADDRESSES: Copies of the documents relevant to this action are 
available for public inspection during normal business hours at EPA 
Region 9's Air Planning Office (AIR-2), 75 Hawthorne Street, San 
Francisco, CA 94105-3901. Due to increased security, please call 24 
hours ahead of your visit so that we can arrange to have someone meet 
you.

Electronic Availability

    This document and the Technical Support Document (TSD) for this 
rulemaking are also available as electronic files on EPA's Region 9 Web 
page at http://www.epa.gov/region09/air/phoenixcbg/.

FOR FURTHER INFORMATION CONTACT: Wienke Tax, Office of Air Planning, 
(AIR-2), EPA Region 9, 75 Hawthorne Street, San Francisco, CA 94105-
3901. Phone: (520) 622-1622; e-mail: [email protected].

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

I. Background

    On September 29, 2003 (68 FR 55920), EPA published a notice of 
proposed rulemaking for the State of Arizona. The notice proposed 
approval of revisions to the SIP for Arizona's CBG program. These 
revisions to the Arizona CBG program have been adopted by the Arizona 
Department of Environmental Quality (ADEQ) and the State legislature 
since EPA approval of the interim CBG program in 1998.
    ADEQ submitted the changes to its CBG program to EPA for approval 
into the SIP in five separate SIP submittals: SIP Revision, Arizona 
Cleaner Burning Gasoline Permanent Rules--Maricopa County Ozone 
Nonattainment Area, February 1999 (``CBG Permanent Rules''), State 
Implementation Plan Revision for the Cleaner Burning Gasoline Program 
in the Maricopa County Ozone Nonattainment Area, March 2001 
(``Summertime Minimum Oxygen Content Removal''), Arizona Cleaner 
Burning Gasoline Rule to Revise the State Implementation Plan for the 
Maricopa County Carbon Monoxide, Ozone, and PM10 Nonattainment Areas, 
August 2001 (``CBG Wintertime Rules''), Supplement to Cleaner Burning 
Gasoline Program State Implementation Plan Revision, September 2001 
(``Technical Supplement'') and Supplement to Cleaner Burning Gasoline 
Program State Implementation Plan Revision, January 2004 (``Statutory 
Supplement'').\1\ The key changes from the interim CBG program approved 
into the SIP in 1998 are described below.
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    \1\ In accordance with section 110(k)(1)(B), these SIP 
submittals were deemed complete by operation of law six months after 
submittal.
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    Since 1997, ADEQ has adopted several amendments to its CBG rule in 
order to make it a permanent rule and to reflect changes made by the 
State legislature to the fuel provisions of the Arizona Revised 
Statutes (ARS). Most of these changes involve the removal of SIP-
approved requirements and options. The ``CBG Permanent Rules'' include 
the following key changes from the interim rules currently approved in 
the SIP:
    [sbull] The standards for Type 3 gasoline (modeled after Federal 
Phase 1 reformulated gasoline [RFG]), which was only available as an 
option in 1998, have been removed along with references to this fuel 
option.\2\
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    \2\ This change was included in ADEQ's February 1999 ``CBG 
Permanent Rules'' submittal and reflects changes to the Arizona 
Revised Statutes by HB 2307.
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    [sbull] Summertime minimum oxygen content standards for Type 1 
gasoline (modeled after Federal Phase 2 RFG) have been removed by 
specifying a 0.0% minimum oxygen content for April 1 through November 1 
in Table 1 of the rule.\3\
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    \3\ For additional information, see ADEQ's March 2001 
``Summertime Minimum Oxygen Content Removal'' submittal. These 
changes reflect amendments to the Arizona Revised Statutes by SB 
1504.
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    [sbull] The option of supplying Type 1 fuel during the winter fuel 
season (November 2 through March 31) has been removed by including 
wintertime fuel specifications that limit suppliers to Type 2 gasoline 
(modeled after California Air Resources Board (CARB) Phase 2) beginning 
in 2000. With this change, requirements for wintertime NOX 
surveys have also been removed because Type 2 gasoline does not include 
a NOX performance standard.
    [sbull] The option to provide non-ethanol oxygenated fuel during 
the winter has been removed by amending the wintertime oxygen content 
provisions to require fuel containing 10% ethanol, unless the use of a 
non-ethanol oxygenate is approved by the Director of ADEQ.\4\
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    \4\ This change was also included in ADEQ's August 2001 ``CBG 
Wintertime Rules'' submittal implementing changes to the Arizona 
Revised Statutes by HB 2347.
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    [sbull] NOX performance standards for Type 1 gasoline 
and summer survey requirements have been amended to conform with 
changes made by EPA to the Federal RFG regulations in December 1997 (62 
FR 68196).\5\
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    \5\ See ADEQ's August 2001 ``CBG Wintertime Rules'' submittal.
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    [sbull] The area subject to the program has been redefined to 
include all of Maricopa County as well as some western portions of 
Pinal County and a small part of southern Yavapai County.\6\
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    \6\ The definition of the covered area has been changed in 
several statutory and regulatory revisions. The final definition 
submitted for EPA approval is described in ADEQ's August 2001 ``CBG 
Wintertime Rules'' submittal and reflects statutory changes made by 
HB 2189.
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    A more complete description of Arizona's submittals and the 
rationale for our approval are presented in the notice of proposed 
rulemaking (68 FR 55920, Sept. 29, 2003), and associated Technical 
Support Document (available at www.epa.gov/region09/air/phoenixcbg/).

II. Public Comments on the Proposed Action

    We received two comment letters on the September 29, 2003, 
proposal. The first, from the Western States Petroleum Association 
(WSPA), strongly supported the proposed SIP approval. The second, from 
the Arizona Center for Law in the Public Interest (ACLPI), raised 
concerns regarding the impact on ambient ozone concentrations. ACLPI's 
comments are addressed below.
    In addition to these comments, we received e-mails submitted prior 
to publication of the proposal in the Federal Register, apparently 
reacting to news stories about the CBG program and MTBE. While these e-
mails do not appear to address our proposed action and therefore do not 
appear to be intended as comments, we discuss them below to address 
potential confusion over the nature of today's action.

ACLPI Comments

    Comment: ACLPI suggests EPA's finding under CAA section 110(l)--
that the CBG program revisions will not interfere with attainment and 
reasonable further progress--is not sufficiently definitive. 
Specifically, ACLPI notes that, ``EPA acknowledges that this removal 
[of the summertime minimum oxygen content requirement] `could result in 
increases in VOC and CO emissions and a decrease in NOX 
emissions' all of which would have the effect of increasing ozone.'' 
ACLPI argues that the basis for EPA's finding is the unsupported 
assumption that

[[Page 10163]]

oxygen content will not affect emissions from newer vehicles and 
therefore the projected emissions changes are ``relatively small'' and 
are more than offset by Phoenix's general downward trend in ambient 
ozone concentrations from 1996 to 2002.
    Response: We concluded in our proposal that the removal of the two 
percent minimum oxygen requirement for summertime CBG is not a 
relaxation of the SIP because the SIP-approved regulations already 
allowed the use of non-oxygenated CBG (CBG Type 2 produced under the 
averaging option) during the summer control period. Thus, the fuel 
options allowed under the revised State rules will be no less stringent 
than those allowed under the current SIP. This side-by-side comparison 
of regulatory requirements is appropriate for purposes of satisfying 
CAA section 110(l) in areas meeting the NAAQS. See Hall v. EPA, 273 
F.3d 1146, 1160 n. 11 (9th Cir. 2001) (noting ``no relaxation'' test 
would ``clearly be appropriate in areas that achieved attainment under 
preexisting rules'').
    We nonetheless went further in working with ADEQ to assess the 
changes in emissions and ozone concentrations likely to occur as a 
result of this change to the CBG program. ACLPI notes our preliminary 
conclusion that small emissions increases might not be a concern given 
the declining ozone concentrations in the area. As noted above, this 
preliminary assessment was not the basis for our 110(l) determination. 
Nor was it the end of our analysis.
    To confirm this preliminary conclusion we conducted detailed 
modeling to predict not only how emissions might change but what these 
emission changes would mean for ozone concentrations. First, we looked 
at how historical ozone concentrations would have been affected by the 
potential fuel changes. Our modeling showed that the new fuel, if used 
in place of the baseline fuel, would have resulted in a four percent 
decrease in the ozone design value from the 1999 baseline year. Second, 
to evaluate future ozone concentrations, we conducted a qualitative 
analysis to predict likely trends in emissions and concentrations. We 
explained that with newer vehicles, the effect of gasoline oxygen 
content on vehicle emissions is likely to diminish, and any small 
emissions changes will be overwhelmed by emission reductions achieved 
by new engine controls. Between these two findings, we concluded that 
the fuel provided to the area will be better for ozone concentrations 
than the fuel used in the area at the time of attainment and that 
emissions from vehicles will continue to decline into the future.
    ACLPI does not acknowledge the analysis provided. Instead, ACLPI 
points to our note that there is not enough data to conclude that 
gasoline oxygen content will affect emissions from the newest 
generation of vehicles. ACLPI implies that we therefore do not know how 
fuel changes will affect emissions in the future.
    While our models for estimating vehicle emissions do not yet 
include data for the newest generation of vehicles, we know how 
gasoline oxygen content affects older vehicles and we know that as the 
overall fleet of vehicles changes, the effect of oxygen content 
diminishes.\7\ In addition, we know that as the fleet changes to 
include more newer vehicles, engine technologies will result in 
significant emission reductions that overwhelm this diminishing effect 
from gasoline oxygen content. Thus, even though we cannot model the 
specific effect of oxygen content on newer vehicles, it is reasonable 
to conclude that emissions will continue to improve with changes to the 
fleet.
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    \7\ The benefit of adding oxygen to gasoline is to ``lean out'' 
chemically an engine that is running rich (i.e., too much fuel, not 
enough air (oxygen)), so that complete combustion occurs (i.e., the 
additional air/oxygen results in CO being converted to 
CO2). Newer vehicles, however, include sophisticated 
feedback controls, which enable these vehicles to maintain air/fuel 
ratios within tight parameters. These ratios are maintained with or 
without the addition of oxygen to gasoline. As a result, the 
benefits of gasoline oxygenates will decline as these feedback 
controls improve in newer vehicles.
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    Comment. ACLPI also claims that it is anticipated that Phoenix will 
violate the new 8-hour ozone standard and therefore objects to EPA's 
failure to analyze the potential impact on 8-hour ozone concentrations.
    Response. While we did not conduct a separate analysis for 8-hour 
ozone concentrations, we did explain that the analysis described above 
should ensure that the revisions to the fuel program will not interfere 
with 8-hour ozone attainment. Modeling showed that the new fuels likely 
to be provided to the area will result in a decrease in peak ozone 
concentrations as compared to the fuel provided in 1999. In addition, 
motor vehicle emissions will continue to decline as improvements in 
engine technologies will overwhelm the diminishing effect of gasoline 
oxygen content on these emissions.

Related E-mails Submitted to EPA

    We received four e-mails, all submitted before the September 29 
publication of the proposed action--one on September 8, one on 
September 15 and two from the same person on September 23. The first 
two of these e-mails encouraged ADEQ to move away from using MTBE as an 
oxygenate. The final two raised questions about how emission reductions 
would be achieved if the area no longer had a CBG program with MTBE.
    These e-mails suggest some confusion regarding the nature of the 
action being taken by ADEQ and EPA. We therefore felt it important to 
reiterate that our action does not ban MTBE from Arizona summertime 
gasoline. The revisions to the CBG program remove the minimum 
summertime oxygen content requirement, but do not ban the use of MTBE 
or any other oxygenate during the summer. Our approval of these 
revisions likewise, does not preclude the use of MTBE.
    With this in mind, we evaluated the fuel formulations refiners are 
likely to supply the area. We concluded approval of these CBG program 
revisions may result in a mixture of MTBE-oxygenated CBG and non-
oxygenated CBG (i.e., ethanol-oxygenated fuel appears unlikely). The 
cheapest fuel to produce will likely be non-oxygenated Type 1 CBG. We 
used these likely fuels to evaluate air quality impacts and concluded 
these changes will not adversely affect air quality in the area.

III. Final Action

    In today's action, we are finding that the Arizona CBG program 
implemented in the Maricopa County area meets CAA and EPA requirements 
for a state fuels program. In addition, under CAA section 110(l), we 
are finding that the SIP revisions submitted by ADEQ do not interfere 
with any applicable requirements for CO, ozone, and PM-10 attainment 
and reasonable further progress (RFP) or any other requirements of the 
CAA applicable to the Phoenix area. The basis for these findings is 
discussed in the proposal for today's action. See 68 FR 55920.
    We have evaluated the submitted SIP revisions and have determined 
that they are consistent with the CAA and EPA regulations. Therefore, 
we are approving the Arizona CBG program into the Arizona SIP under 
section 110(k)(3) of the CAA as meeting the requirements of section 
110(a) and part D to address ozone, CO and PM-10 nonattainment in the 
Maricopa County area.
    Specifically, we are approving the following elements of the CBG 
program: Arizona Administrative Code (AAC) R20-2-701, R20-2-716, R20-2-
750 through 762, and title 20, chap. 2, art. 7, Tables 1 and 2 (March 
31, 2001); and Arizona Revised Statutes (ARS) Sec. Sec.  49-541(1)(a), 
(b), and (c) (as codified on

[[Page 10164]]

August 9, 2001), 41-2124 (as codified on April 28, 2000), 41-2123 (as 
codified on August 6, 1999), 41-2113(B)(4) (as codified on August 21, 
1998), 41-2115 (as codified on July 18, 2000), and 41-2066(A)(2) (as 
codified on April 20, 2001).
    Nothing in this action should be construed as permitting or 
allowing or establishing a precedent for any future implementation 
plan. Each request for revision to a state implementation plan shall be 
considered separately in light of specific technical, economic, and 
environmental factors and in relation to relevant statutory and 
regulatory requirements.

IV. Statutory and Executive Order Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
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 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 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 approves 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).
    This 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 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 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 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.).
    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 is not a ``major rule'' as defined by 5 U.S.C. 
804(2).
    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the appropriate circuit by May 3, 2004. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect the finality of this rule for the purposes of judicial 
review nor does it extend the time within which a petition for judicial 
review may be filed, and shall not postpone the effectiveness of such 
rule or action. This action may not be challenged later in proceedings 
to enforce its requirements. (See CAA section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, 
Incorporation by reference, Intergovernmental regulations, Ozone, 
Particulate matter, Reporting and recordkeeping requirements.

    Dated: January 26, 2004.
Wayne Nastri,
Regional Administrator, Region 9.

0
Part 52, chapter I, title 40 of the Code of Federal Regulations is 
amended 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.

Subpart D--Arizona

0
2. Section 52.120 is amended by adding paragraphs (c)(112) and (c)(113) 
to read as follows:


Sec.  52.120  Identification of plan.

* * * * *
    (c) * * *
    (112) Revised regulations were submitted on August 15, 2001, by the 
Governor's designee as part of the submittal entitled Arizona Cleaner 
Burning Gasoline Rule to Revise the State Implementation Plan for the 
Maricopa County Carbon Monoxide, Ozone, and PM10 Nonattainment Areas. 
The incorporated materials from this submittal supercede those included 
in the submittals entitled SIP Revision, Arizona Cleaner Burning 
Gasoline Permanent Rules--Maricopa County Ozone Nonattainment Area, 
submitted on February 24, 1999, and State Implementation Plan Revision 
for the Cleaner Burning Gasoline Program in the Maricopa County Ozone 
Nonattainment Area, submitted on March 29, 2001.
    (i) Incorporation by reference.
    (A) Arizona Administrative Code.
    (1) AAC R20-2-701, R20-2-716, R20-2-750 through 762, and Title 20, 
Chap. 2, Art. 7, Tables 1 and 2 (March 31, 2001).
    (113) Revised statutes were submitted on January 22, 2004, by the 
Governor's designee as part of the submittal entitled Supplement to 
Cleaner Burning Gasoline Program State Implementation Plan Revision. 
The incorporated materials from this submittal supercede those included 
in the submittals entitled SIP Revision, Arizona Cleaner Burning 
Gasoline Permanent Rules--Maricopa County Ozone Nonattainment Area, 
submitted on February 24, 1999, State Implementation Plan Revision for 
the

[[Page 10165]]

Cleaner Burning Gasoline Program in the Maricopa County Ozone 
Nonattainment Area, submitted on March 29, 2001, and Arizona Cleaner 
Burning Gasoline Rule to Revise the State Implementation Plan for the 
Maricopa County Carbon Monoxide, Ozone, and PM10 Nonattainment Areas, 
submitted August 15, 2001.
    (i) Incorporation by reference.
    (A) Arizona Revised Statutes.
    (1) ARS sections 49-541(1)(a), (b), and (c), 41-2124, 41-2123, 41-
2113(B)(4), 41-2115, and 41-2066(A)(2) (as codified on March 31, 2001).

[FR Doc. 04-4814 Filed 3-3-04; 8:45 am]
BILLING CODE 6560-50-P