[Federal Register Volume 69, Number 193 (Wednesday, October 6, 2004)]
[Notices]
[Pages 59918-59920]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-22487]


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ENVIRONMENTAL PROTECTION AGENCY

[FRL-7824-5]


Request for Applications for Essential Use Exemptions to the 
Production and Import Phaseout of Ozone Depleting Substances Under the 
Montreal Protocol for the Years 2006 and 2007

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice.

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SUMMARY: Through this action, the Environmental Protection Agency (EPA) 
is requesting applications for essential use allowances for calendar 
years 2006 and 2007. Essential use allowances provide exemptions to the 
production and import phaseout of ozone-depleting substances and must 
be authorized by the Parties to the Montreal Protocol on Substances 
that Deplete the Ozone Layer. The U.S. Government will use

[[Page 59919]]

the applications received in response to this notice as the basis for 
its nomination of essential use allowances at the Seventeenth Meeting 
of the Parties to the Montreal Protocol on Substances that Deplete the 
Ozone Layer (the Protocol), to be held in 2005.

DATES: Applications for essential use exemptions must be submitted to 
EPA no later than November 5, 2004 in order for the U.S. Government to 
complete its review and to submit nominations to the United Nations 
Environment Programme and the Protocol Parties in a timely manner.

ADDRESSES: Send two copies of application materials to: Scott Monroe, 
Stratospheric Protection Division (6205J), U.S. Environmental 
Protection Agency, 1200 Pennsylvania Avenue, NW., Washington, DC 20460. 
(For applications sent via courier service, use the following direct 
mailing address: 1310 L Street, NW., Washington, DC 20005.) 
Confidentiality: Application materials that are confidential should be 
submitted under separate cover and be clearly identified as ``trade 
secret,'' ``proprietary,'' or ``company confidential.'' Information 
covered by a claim of business confidentiality will be treated in 
accordance with the procedures for handling information claimed as 
confidential under 40 CFR part 2, subpart B, and will be disclosed only 
to the extent and by means of the procedures, set forth in that 
subpart. Please note that data will be presented in aggregate form by 
the United States as part of the nomination to the Parties. If no claim 
of confidentiality accompanies the information when it is received by 
EPA, the information may be made available to the public by EPA without 
further notice to the company (40 CFR 2.203).

FOR FURTHER INFORMATION CONTACT: Scott Monroe at the above address, or 
by telephone at (202) 343-9712, by fax at (202) 343-2363, or by e-mail 
at [email protected]. General information may be obtained from EPA's 
stratospheric protection Web site at http://www.epa.gov/ozone.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Background on the Essential Use Nomination Process
II. Information Required for Essential Use Applications for 
Production or Importation of Class I Substances in 2006 and 2007

I. Background--The Essential Use Nomination Process

    As described in previous Federal Register (FR) documents,\1\ the 
Parties to the Protocol agreed during the Fourth Meeting in Copenhagen 
on November 23-25, 1992, to accelerate the phaseout schedules for Class 
I ozone-depleting substances. Specifically, the Parties agreed that 
non-Article 5 Parties (that is, developed countries) would phase out 
the production and consumption of halons by January 1, 1994, and the 
production and consumption of other class I substances (under 40 CFR 
part 82, subpart A), except methyl bromide, by January 1, 1996. The 
Parties also reached decisions and adopted resolutions on a variety of 
other matters, including the criteria to be used for allowing 
``essential use'' exemptions from the phaseout of production and 
importation of controlled substances. Decision IV/25 of the Fourth 
Meeting of the Parties details the specific criteria and review process 
for granting essential use exemptions.
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    \1\ 58 FR 29410, May 20, 1993; 58 FR 52544, October 18, 1994; 60 
FR 54349, October 23, 1995; 61 FR 51110, 0 30, 1996, 62 FR 51655, 
October 2, 1997; 63 FR 42629, August 10, 1998; 64 FR 50083, 
September 15, 1999; 65 FR 65377, November 1, 2000; and 200166 FR 
56102, November 6, 2001.
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    Decision IV/25, paragraph 1(a), states that ``* * * a use of a 
controlled substance should qualify as ``essential'' only if: (i) It is 
necessary for the health, safety or is critical for the functioning of 
society (encompassing cultural and intellectual aspects); and (ii) 
there are no available technically and economically feasible 
alternatives or substitutes that are acceptable from the standpoint of 
environment and health.'' In addition, the Parties agreed ``that 
production and consumption, if any, of a controlled substance, for 
essential uses should be permitted only if: (i) All economically 
feasible steps have been taken to minimize the essential use and any 
associated emission of the controlled substance; and (ii) the 
controlled substance is not available in sufficient quantity and 
quality from the existing stocks of banked or recycled controlled 
substances * * *.'' Decision XII/2 taken at the twelfth meeting of the 
Parties states that any CFC metered dose inhaler (MDI) product approved 
after December 31, 2000, is nonessential unless the product meets the 
criteria in Decision IV/25, paragraph 1(a).
    The first step in obtaining essential use allowances is for the 
user to consider whether the use of the controlled substance meets the 
criteria of Decision IV/25. If the essential use request is for an MDI 
product, that product must also meet the criteria of Decision XII/2. 
The user should then send a completed application in order to notify 
EPA of the candidate use and provide information for U.S. Government 
agencies and the Protocol Parties to evaluate that use according to the 
criteria under the Protocol.
    Upon receipt of the essential use exemption application, EPA 
reviews the information provided and works with other interested 
Federal agencies to determine whether it meets the essential use 
criteria and warrants being nominated by the United States for an 
exemption. In the case of multiple exemption requests for a single use, 
such as for MDIs, EPA aggregates exemption requests received from 
individual entities into a single U.S. request. An important part of 
the EPA review of requests for CFCs for MDIs is to determine that the 
aggregate request for a particular future year adequately reflects the 
total market need for CFC MDIs and expected availability of CFC 
substitutes by that point in time. If the sum of individual requests 
does not account for such factors, the U.S. Government may adjust the 
aggregate request to better reflect true market needs.
    Nominations submitted by the United States and other Parties are 
forwarded from the United Nations Ozone Secretariat to the Montreal 
Protocol's Technical and Economic Assessment Panel (TEAP) and its 
Technical Options Committees (TOCs), which review the submissions and 
make recommendations to the Protocol Parties for essential use 
exemptions. Those recommendations are then considered by the Parties at 
their annual meeting for final decision. If the Parties declare a 
specified use of a controlled substance as essential, and issue the 
necessary exemption from the production and consumption phaseout, EPA 
may propose regulatory changes to reflect the decisions by the Parties, 
but only to the extent such action is consistent with the Clean Air Act 
(CAA or Act).
    Applicants should be aware that essential use exemptions granted to 
the United States under the Protocol in recent years have been limited 
to chlorofluorocarbons (CFCs) for metered dose inhalers (MDIs) to treat 
asthma and chronic obstructive pulmonary disease, and methyl chloroform 
for use in manufacturing solid rocket motors. As of January 1, 2005, 
methyl chloroform will no longer be eligible for essential use 
allowances under section 604(d)(1) of the Act. EPA is consulting with 
the Department of Defense to identify mission-critical uses for which 
methyl

[[Page 59920]]

chloroform or other ozone-depleting substances may be needed in the 
future.
    The timing of the process described above is such that in any given 
year the Parties review nominations for essential use exemptions from 
the production and consumption phaseout intended for the following year 
and subsequent years. This means that, if nominated, applications 
submitted in response to today's notice for an exemption in 2006 and 
2007 will be considered by the Parties in 2005 for final action.
    The quantities of controlled ODSs that are requested in response to 
this notice, if approved by the Parties to the Montreal Protocol in 
2005, will then be allocated as essential use allowances (EUAs) to the 
specific U.S. companies through notice and comment rulemaking, to the 
extent that such allocations are consistent with the Act. EUAs for the 
year 2006 will be allocated to U.S. companies at the end of 2005, and 
EUAs for the year 2007 will be allocated at the end of 2006.

II. Information Required for Essential Use Applications for Production 
or Importation of Class I Substances in 2006 and 2007

    Through this action, EPA requests applications for essential use 
exemptions for all class I substances, except methyl bromide, for 
calendar years 2006 and 2007. (EPA requests and considers applications 
for critical use exemptions for methyl bromide through a separate 
process.) This notice is the last opportunity to submit new or revised 
applications for 2006. This notice is also the first opportunity to 
submit requests for 2007. Companies will have an opportunity to submit 
new, supplemental, or amended applications for 2007 next year. All 
requests for exemptions submitted to EPA must present information as 
prescribed in the current version of the TEAP ``Handbook on Essential 
Use Nominations'' (or ``handbook''), which was published in June 2001. 
The handbook is available electronically on the Web at http://www.teap.org, or at http://www.epa.gov/ozone.
    In brief, the TEAP Handbook states that applicants must present 
information on:
     Role of use in society;
     Alternatives to use;
     Steps to minimize use;
     Steps to minimize emissions;
     Recycling and stockpiling;
     Quantity of controlled substances requested; and
     Approval date and indications (for MDIs).
    First, in order to obtain complete information from essential use 
applicants for CFC MDIs, EPA requires that any person who requests CFCs 
for multiple companies make clear the amount of CFCs requested for each 
member company. Second, all essential use applications for CFCs must 
provide a breakdown of the quantity of CFCs necessary for each MDI 
product to be produced. This detailed breakdown of EUAs will allow EPA 
and the Food and Drug Administration to make informed decisions on the 
amount of CFC to be nominated by the U.S. Government for the years 2006 
and 2007. Third, all new drug application (NDA) holders for CFC MDI 
products produced in the United States must submit a complete 
application for essential use allowances either on their own or in 
conjunction with their contract filler. In the case where a contract 
filler produces a portion of an NDA holder's CFC MDIs, the contract 
filler and the NDA holder must determine the total amount of CFCs 
necessary to produce the NDA holder's entire product line of CFC MDIs. 
The NDA holder must provide an estimate of how the CFCs would be split 
between the contract filler and the NDA holder in the allocation year. 
This estimate will be used only as a basis for determining the 
nomination amount, and may be adjusted prior to allocation of EUAs. 
Since the U.S. Government cannot forward incomplete or inadequate 
nominations to the Ozone Secretariat, it is important for applicants to 
provide all information requested in the Handbook, including the 
information specified in the Supplemental Research and Development form 
(page 45).
    The accounting framework matrix in the handbook entitled ``Table 
IV: Reporting Accounting Framework for Essential Uses Other Than 
Laboratory and Analytical'' requests data for the year 2004 on the 
amount of ODS exempted for an essential use, the amount acquired by 
production, the amount acquired by import, the amount on hand at the 
start of the year, the amount available for use in 2004, the amount 
used for the essential use, the quantity contained in exported 
products, the amount destroyed, and the amount on hand at the end of 
2004. Because all data necessary for applicants to complete Table IV 
will not be available until after January 1, 2005, companies should not 
include this chart with their EUA applications in response to this 
notice. Instead, companies should provide the required data as 
specified in 40 CFR 82.13(u)(2). EPA must compile companies' responses 
to complete the U.S. CFC Accounting Framework for submission to the 
Parties to the Montreal Protocol by the end of January.
    EPA anticipates that the Parties' review of MDI essential use 
requests will focus extensively on the United States' progress in 
phasing out CFC MDIs, including efforts by pharmaceutical companies to 
research, develop, and market non-CFC products. Accordingly, applicants 
are strongly advised to present detailed information on this subject. 
Applicants should submit their exemption requests to EPA as noted in 
the ADDRESSES section above.

    Dated: September 28, 2004.
Jeffrey R. Holmstead,
Assistant Administrator, Office of Air and Radiation.
[FR Doc. 04-22487 Filed 10-5-04; 8:45 am]
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