[Federal Register Volume 69, Number 177 (Tuesday, September 14, 2004)]
[Proposed Rules]
[Pages 55386-55388]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-20682]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[CA-310-0465; FRL-7809-6]


Revisions to the California State Implementation Plan, South 
Coast Air Quality Management District

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to approve revisions to the South Coast Air 
Quality Management District (``SCAQMD'') portion of the California 
State Implementation Plan (SIP). These revisions concern oxides of 
nitrogen

[[Page 55387]]

(NOX) and oxides of sulfur (SOX) emissions from 
facilities emitting 4 tons or more per year of NOX and/or 
SOX under the SCAQMD Regional Clean Air Incentives Market 
(``RECLAIM''). We are proposing to approve a local rule 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 October 14, 2004.

ADDRESSES: Send comments to Andy Steckel, Rulemaking Office Chief (AIR-
4), U.S. EPA, 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 document (TSD), 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.
    South Coast Air Quality Management District, 21865 E. Copley Dr., 
Diamond Bar, CA 91765-4182.
    A copy of the rule 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 Web site and may not contain the same version of the rule that 
was submitted to EPA.

FOR FURTHER INFORMATION CONTACT: Andy Steckel, EPA Region IX, (415)947-
4115, [email protected].

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

Table of Contents

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

I. The State's Submittal

A. What Rule Did the State Submit?

    Table 1 lists the rule addressed by this proposal with the date 
that it was adopted by SCAQMD and submitted by the California Air 
Resources Board (CARB).

                                            Table 1.--Submitted Rules
----------------------------------------------------------------------------------------------------------------
            Local agency                Rule No.              Rule title              Adopted        Submitted
----------------------------------------------------------------------------------------------------------------
SCAQMD.............................            2015  Backstop provisions........        06/04/04        07/29/04
----------------------------------------------------------------------------------------------------------------

    On August 10, 2004, this rule submittal was found to meet the 
completeness criteria in 40 CFR part 51, appendix V, which must be met 
before formal EPA review.

B. Are There Other Versions of This Rule?

    We approved a version of Rule 2015 into the SIP on September 9, 
2003.

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. 
Section 110(a) of the CAA requires states to submit regulations that 
control NOX emissions. The RECLAIM program sets an emissions 
cap and declining balance for many of the largest NOX and 
SOx facilities in the South Coast Air Basin. The program was designed 
to provide additional incentives for industry to reduce emissions and 
advance pollution control technologies. During our review of previously 
submitted versions of the RECLAIM program rules, EPA raised concerns 
regarding provisions that allowed facilities, under certain conditions, 
to not deduct excess emissions associated with equipment breakdowns 
from the facility's RECLAIM Trading Credit (``RTC'') Allocation. EPA 
notified SCAQMD that these provisions conflicted with the Clean Air Act 
as interpreted by a September 20, 1999 EPA policy that, where possible, 
requires mitigation of all excess emissions during equipment 
malfunctions, startup, and shutdown.
    SCAQMD staff committed in a letter dated April 2, 2002 to address 
the issue of breakdown emissions under the RECLAIM program. On May 13, 
2002, EPA proposed conditional approval of the May 2001 RECLAIM 
amendments into the SIP (67 FR 31998). The conditional approval was 
finalized on September 4, 2003 (68 FR 52512). Specifically, the 
conditional approval required that SCAQMD adopt amendments to RECLAIM 
which would establish a mechanism within the RECLAIM program to ensure 
mitigation of all excess emissions resulting from breakdowns. The 
commitment made in the April 2nd letter stipulated that SCAQMD would 
monitor and track excess emissions from breakdowns and compare the 
total amount of these excess emissions to unused RTCs each year for the 
entire RECLAIM program. If the yearly breakdown emissions from all 
RECLAIM sources exceeded the unused RTCs, programmatic reductions from 
RECLAIM allocations in the following year would be made to mitigate the 
excess emissions. The TSD has more information about these rules.

II. EPA's Evaluation and Action

    A. How Is EPA Evaluating the Rule?
    Generally, SIP rules must be enforceable (see section 110(a) of the 
Act), must require Reasonably Available Control Technology (RACT) for 
major sources in nonattainment areas (see section 182(a)(2)(A) and 
182(f)), and must not relax existing requirements (see sections 110(l) 
and 193). The SCAQMD regulates an ozone nonattainment area (see 40 CFR 
part 81), so the RECLAIM program must fulfill RACT.
    Guidance and policy documents that we used to help evaluate 
enforceability and RACT requirements consistently include the 
following:
    1. ``State Implementation Plans; Nitrogen Oxides Supplement to the 
General Preamble; Clean Air Act Amendments of 1990 Implementation of 
Title I; Proposed Rule,'' (the NOX Supplement), 57 FR 55620, 
November 25, 1992.
    2. ``Issues Relating to VOC Regulation Cutpoints, Deficiencies, and 
Deviations,'' EPA, May 25, 1988 (the Bluebook).
    3. ``Guidance Document for Correcting Common VOC & Other Rule 
Deficiencies,'' EPA Region 9, August 21, 2001 (the Little Bluebook).
    4. Requirements applicable to emissions trading programs such as 
RECLAIM are contained in ``Improving Air Quality with Economic 
Incentive Programs,'' January 2001, Office of Air and Radiation, EPA-
452/R-01-001 (``EIP Guidance''). This guidance applies to discretionary 
economic incentive programs (``EIPs'') and represents the

[[Page 55388]]

agency's interpretation of what EIPs should contain in order to meet 
the requirements of the CAA. Because this guidance is non-binding and 
does not represent final agency action, EPA is using the guidance as an 
initial screen to determine whether approvability issues arise.
    5. Excess emissions provisions are addressed by ``State 
Implementation Plans: Policy Regarding Excess Emissions During 
Malfunctions, Startup and Shutdown,'' EPA's Office of Air and Radiation 
and Office of Enforcement and Compliance Assurance, September 20, 1999 
(``Excess Emissions Policy'').

B. Does the Rule Meet the Evaluation Criteria?

    We believe this rule is consistent with the CAA as applied by 
relevant policy and guidance regarding emissions trading programs, 
excess emissions provisions, enforceability, RACT, and SIP relaxations. 
Specifically, the submitted rule amendments were found to fulfill the 
requirements of EPA's previous conditional approval of the RECLAIM 
program rules and to address all concerns raised therein with respect 
to our Excess Emissions Policy. The TSD has more information on our 
evaluation.

C. Public Comment and Final Action

    Because EPA believes the submitted rule fulfills all relevant 
requirements, we are proposing to fully approve it 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 this rule into the federally 
enforceable SIP.

III. 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, Reporting and recordkeeping 
requirements.

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

    Dated: August 17, 2004.
Wayne Nastri,
Regional Administrator, Region IX.
[FR Doc. 04-20682 Filed 9-13-04; 8:45 am]
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