[Federal Register Volume 70, Number 59 (Tuesday, March 29, 2005)]
[Rules and Regulations]
[Pages 15994-16035]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-6037]



[[Page 15993]]

-----------------------------------------------------------------------

Part II





Environmental Protection Agency





-----------------------------------------------------------------------



40 CFR Part 63



Revision of December 2000 Regulatory Finding on the Emissions of 
Hazardous Air Pollutants From Electric Utility Steam Generating Units 
and the Removal of Coal- and Oil-Fired Electric Utility Steam 
Generating Units From the Section 112(c) List; Final Rule

  Federal Register / Vol. 70, No. 59 / Tuesday, March 29, 2005 / Rules 
and Regulations  

[[Page 15994]]


-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 63

[OAR-2002-0056; FRL-7887-7]
RIN 2060-AM96


Revision of December 2000 Regulatory Finding on the Emissions of 
Hazardous Air Pollutants From Electric Utility Steam Generating Units 
and the Removal of Coal- and Oil-Fired Electric Utility Steam 
Generating Units From the Section 112(c) List

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The EPA is revising the regulatory finding that it issued in 
December 2000 pursuant to section 112(n)(1)(A) of the Clean Air Act 
(CAA), and based on that revision, removing coal- and oil-fired 
electric utility steam generating units (``coal- and oil-fired Utility 
Units'') from the CAA section 112(c) source category list. Section 
112(n)(1)(A) of the CAA is the threshold statutory provision underlying 
today's action. That provision requires EPA to conduct a study to 
examine the hazards to public health that are reasonably anticipated to 
occur as the result of hazardous air pollutant (HAP) emissions from 
Utility Units after imposition of the requirements of the CAA. The 
provision also provides that EPA shall regulate Utility Units under 
section 112, but only if the Administrator determines that such 
regulation is both ``appropriate'' and ``necessary'' considering, among 
other things, the results of the study. EPA completed the study in 1998 
(the Utility Study), and in December 2000 found that it was 
``appropriate and necessary'' to regulate coal- and oil-fired Utility 
Units under CAA section 112. That December 2000 finding focused 
primarily on mercury (Hg) emissions from coal-fired Utility Units. In 
light of the finding, EPA in December 2000 announced its decision to 
list coal- and oil-fired Utility Units on the section 112(c) list of 
regulated source categories. In January 2004, EPA proposed revising the 
December 2000 appropriate and necessary finding and, based on that 
revision, removing coal- and oil-fired Utility Units from the section 
112(c) list.
    By this action, we are revising the December 2000 appropriate and 
necessary finding and concluding that it is neither appropriate nor 
necessary to regulate coal- and oil-fired Utility Units under section 
112. We are taking this action because we now believe that the December 
2000 finding lacked foundation and because recent information 
demonstrates that it is not appropriate or necessary to regulate coal- 
and oil-fired Utility Units under section 112. Based solely on the 
revised finding, we are removing coal- and oil-fired Utility Units from 
the section 112(c) list. The reasons supporting this action are 
described in detail below. Other actions related to this final rule 
include the recent promulgation of the final Clean Air Interstate Rule 
(CAIR) and the final Clean Air Mercury Rule (CAMR).

DATES: Effective Date: The effective date of the final rule is March 
29, 2005.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. OAR-2002-0056. All documents in the docket are listed in the 
EDOCKET index at http://www.epa.gov/edocket. Although listed in the 
index, some information is not publicly available, i.e., Confidential 
Business Information (CBI) or other information whose disclosure is 
restricted by statute. Certain other material, such as copyrighted 
material, is not placed on the Internet and will be publicly available 
only in hard copy form. Publicly available docket materials are 
available either electronically in EDOCKET or in hard copy at the EPA 
Docket Center (EPA/DC), EPA West Building, Room B102, 1301 Constitution 
Ave., NW., Washington, DC. The Public Reading Room is open from 8:30 
a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The 
telephone number for the Public Reading Room is (202) 566-1744, and the 
telephone number for the EPA Docket Center is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: Ms. Wendy Blake, OGC Attorney, Office 
of General Counsel, Environmental Protection Agency, (AR-2344), 
Washington, DC 20460 telephone number: (202) 564-1821; fax number: 
(202) 564-5603; e-mail address: [email protected].
    Judicial Review. Pursuant to CAA section 307(b), judicial review of 
this final rule is available only by filing a petition for review in 
the United States Court of Appeals for the District of Columbia Circuit 
by May 31, 2005. EPA designates this action a CAA section 307(d) 
rulemaking. (See CAA section 307(d)(1)(V); 69 FR 4653 (January 30, 
2004).) Under CAA section 307(d)(7)(B), only an objection to the rule 
that was raised with reasonable specificity during the time period for 
public comment can be raised during judicial review. Section 
307(d)(7)(B) further provides that if the person raising the objection 
can demonstrate to the Administrator that it was impracticable to raise 
the objection during the public comment period or if the grounds for 
the objection arose after the public comment period but within the time 
period specified for judicial review and if the objection is of central 
relevance, EPA will convene a proceeding for reconsideration of the 
rule and provide the same procedural rights as would have been afforded 
had the information been available at the time the rule was proposed.

I. Statutory Background

    In the 1990 Amendments to the CAA, Congress substantially modified 
CAA section 112, the provision of the CAA addressing HAP. Among other 
things, section 112 contains a list of ``hazardous air pollutants,'' 
which are ``pollutants which present, or may present, * * * a threat of 
adverse human health effects * * * or adverse environmental effects 
whether through ambient concentrations, bioaccumulation, deposition, or 
otherwise.'' (See CAA section 112(b)(2).) In the 1990 amendments to the 
CAA, Congress listed 190 HAP, and authorized EPA to add or remove 
pollutants from the list.\1\ (See CAA Section 112(b)(1)-(b)(3).)
---------------------------------------------------------------------------

    \1\ The current section 112(b) list includes 188 HAP.
---------------------------------------------------------------------------

    The types of sources addressed under section 112 include: major 
sources, area sources, and electric utility steam generating units 
(Utility Units). (See CAA 112(a)(1), (a)(2), (a)(8).) A ``major 
source'' is any stationary source \2\ or group of stationary sources at 
a single location and under common control that emits or has the 
potential to emit ten tons or more per year of any HAP or 25 tons or 
more per year of any combination of HAP. (See CAA 112(a)(1).) A 
stationary source of HAP that is not a ``major source'' is an ``area 
source.'' (See CAA 112(a)(2).) Finally, an electric utility steam 
generating unit is any ``fossil fuel fired combustion unit of more than 
25 megawatts that serves a generator that produces electricity for 
sale.'' (See CAA 112(a)(8).)
---------------------------------------------------------------------------

    \2\ A ``stationary source'' of hazardous air pollutants is any 
building, structure, facility or installation that emits or may emit 
any air pollutant. (See CAA Section 111(a)(3) and 112(a)(3).)
---------------------------------------------------------------------------

    There are two important steps under section 112: (1) Determining 
whether a source category meets the statutory criteria for regulation 
under section 112; and (2) promulgating emission standards for those 
source categories regulated under section 112. In terms of the first 
step, Congress required EPA to publish a list of categories and

[[Page 15995]]

subcategories of major sources and area sources by November 15, 
1991.\3\ (See CAA 112(c)(1) & (c)(3).) Congress further directed EPA to 
revise this initial list periodically, based on, for example, new 
information. (See 112(c)(1).) EPA is required to list a category of 
major sources under section 112(c)(1) if at least one stationary source 
in the category meets the definition of a major source--i.e., if a 
certain amount of a HAP (or combination of HAP) is emitted from the 
source. (See 112(a)(1).) By contrast, EPA is required to list 
categories or subcategories of area sources only if they meet one of 
the following statutory criteria: (1) EPA determines that the category 
of area sources presents a threat of adverse effects to human health or 
the environment that warrants regulation under CAA section 112; or (2) 
the category of area sources falls within the purview of CAA section 
112(k)(3)(B) (the Urban Area Source Strategy). (See CAA 112(c)(3).)
---------------------------------------------------------------------------

    \3\ EPA published the initial list on July 16, 1992. See 57 FR 
31,576, July 16, 1992. EPA did not include Utility Units on the 
initial section 112(c) list because Congress required EPA to conduct 
and consider the results of the study required by section 
112(n)(1)(A) before regulating these units and, therefore, listing 
in 1992 was not authorized by statute.
---------------------------------------------------------------------------

    For those source categories regulated under section 112, the next 
step concerns the establishment of emission standards. Under section 
112(d), EPA must establish emission standards that ``require the 
maximum degree of reduction in emissions of the hazardous air 
pollutants subject to this section'' that the Administrator determines 
is achievable based on technology, taking into account certain factors 
such as cost, energy requirements, and other impacts. The emission 
standard for new sources cannot be, however, less stringent than the 
level of control achieved by the best controlled similar source, and 
the emission standard for existing sources cannot be less stringent 
than the average emission limitation achieved by the best performing 12 
percent of existing sources in the category, regardless of cost, energy 
requirements and other impacts. CAA 112(d)(2) and (3). Finally, within 
eight years after promulgation of section 112(d) emission standards for 
a listed source category, EPA must promulgate additional standards if 
such standards are necessary to provide an ample margin of safety to 
protect public health or to prevent an adverse environmental effect. 
(See CAA section 112(f).) These additional standards under CAA section 
112(f) are commonly referred to as ``residual risk'' standards.
    The criteria for listing major and area sources established in 
section 112(c)(1) and (c)(3) do not apply to Utility Units because 
Congress treated Utility Units differently from other major and area 
sources. Indeed, Congress enacted a special provision for Utility Units 
in section 112(n)(1)(A), which governs whether Utility Units should 
even be regulated under section 112.\4\ Section 112(n)(1)(A) directs 
EPA to conduct a study to evaluate what ``hazards to public health 
[are] reasonably anticipated to occur'' as the result of HAP emissions 
from Utility Units ``after imposition of the requirements of th[e] 
Act,'' (emphasis added) and to report the results of such study to 
Congress by November 15, 1993. Congress also directed EPA to describe 
in the report to Congress ``alternative control strategies for [those] 
emissions that may warrant regulation under this section.'' (See CAA 
section 112(n)(1)(A).) Section 112(n)(1)(A) further provides that EPA 
shall regulate Utility Units under section 112 if the Administrator 
determines, considering the results of the study, that such regulation 
is ``appropriate and necessary.'' Thus, unlike other major and area 
sources, Congress first required EPA to examine how ``imposition of the 
requirements of th[e] Act'' would affect the overall level of utility 
HAP emissions, and then determine whether regulation of Utility Units 
under section 112 is both appropriate and necessary. Section 
112(n)(1)(A) therefore sets an important and unique condition precedent 
for regulating Utility Units under section 112 and provides EPA 
discretion in determining whether that condition precedent has been 
met.
---------------------------------------------------------------------------

    \4\ No one would dispute that certain Utility Units would meet 
the definition of a ``major source'' based on the quantity of HAP 
emitted from such units, or that other Utility Units may meet the 
``area source'' criteria for listing under section 112(c)(3), but 
Congress recognized this fact in 1990 and specifically enacted 
section 112(n)(1)(A), which establishes an entirely different test 
for determining whether Utility Units should be regulated under 
section 112.
---------------------------------------------------------------------------

II. Regulatory Background

A. EPA's December 20, 2000 Regulatory Finding

    On December 20, 2000, EPA issued a finding pursuant to CAA section 
112(n)(1)(A) that it was appropriate and necessary to regulate coal- 
and oil-fired Utility Units under section 112. In making that finding, 
EPA considered the Utility Study, which was completed and submitted to 
Congress in February 1998.
    In the Utility Study, we divided Utility Units into three 
subcategories based on fuel type: coal-, oil-, and gas-fired units. We 
then analyzed HAP emissions from each subcategory. We followed this 
approach because each subcategory burns a different fuel, which, in 
turn, leads to different emissions profiles, which can require 
different emission controls. This approach is also consistent with 
EPA's historical practice of subcategorizing Utility Units based on 
fuel type. (See, e.g., 40 CFR 60.44(a).)
    Because EPA subcategorized Utility Units for purposes of the 
Utility Study, EPA, in December 2000, made separate ``appropriate and 
necessary'' findings under section 112(n)(1)(A) for gas-fired, coal-
fired, and oil-fired Utility Units. In making these findings, EPA 
considered the Utility Study and certain additional information 
obtained after completion of the Utility Study, including the National 
Academy of Sciences' report concerning the health effects of 
methylmercury and actual emissions data obtained in response to an 
information collection request EPA issued to all coal-fired Utility 
Units in 1999. See 65 FR 79826. EPA reasonably relied on this 
additional information because the information provided a more 
comprehensive and contemporaneous record concerning Hg emissions from 
coal-fired units. Nothing in section 112(n)(1)(A) suggests that 
Congress sought to preclude EPA from considering more current 
information in making the appropriate and necessary finding.
    In the December 2000 finding, EPA determined that it was 
appropriate and necessary to regulate coal- and oil-fired units, but 
not gas-fired units.\5\ With respect to the latter, EPA found that 
regulation of HAP emissions from natural gas-fired Utility Units ``is 
not appropriate or necessary because the impacts due to HAP emissions 
from such units are negligible based on the results of the study 
documented in the utility RTC.'' (Emphasis added) See 65 FR 79831.
---------------------------------------------------------------------------

    \5\ Although the December 2000 finding addressed three 
subcategories of Utility Units--coal-, oil-, and gas-fired units, 
the majority of the finding concerned Hg emissions from coal-fired 
power plants. 65 FR 79826-29 (explaining that Hg from coal-fired 
units is the HAP of greatest concern); Utility Study, ES-27 
(``mercury from coal-fired utilities is the HAP of greatest 
potential concern.'').
---------------------------------------------------------------------------

    EPA provided three primary reasons in support of its finding that 
it was ``appropriate'' to regulate coal- and oil-fired Utility Units 
under section 112. First, EPA found that it was appropriate to regulate 
HAP emissions from coal- and oil-fired Utility Units because Utility 
Units ``are the largest domestic source of Hg emissions.'' See 65 FR 
79830. EPA next found that it was

[[Page 15996]]

appropriate to regulate coal- and oil-fired Utility Units because 
``mercury in the environment presents significant hazards to public 
health and the environment.'' \6\ See 65 FR 79830. Finally, EPA 
explained that it was appropriate to regulate HAP emissions from coal- 
and oil-fired units because it had identified certain control options 
that, it anticipated, would effectively reduce HAP from such units. In 
discussing the appropriate finding, EPA also noted that uncertainties 
remained concerning the extent of the public health impact from HAP 
emissions from oil-fired units. Thus, EPA's determination that it was 
``appropriate'' to regulate coal- and oil-fired units under section 112 
hinged on the health effects associated with Hg emissions from coal-
fired Utility Units, the uncertainties associated with the health 
effects of HAP from oil-fired Utility Units, and EPA's belief that 
control options would be available to reduce certain utility HAP 
emissions.\7\
---------------------------------------------------------------------------

    \6\ Section IV below addresses our conclusion that it is not 
appropriate and necessary to regulate coal- and oil-fired Utility 
Units under section 112 and explains why we now believe that our 
December 2000 finding lacked foundation. As explained below, one of 
the reasons the December 2000 ``appropriate'' finding for oil-fired 
Utility Units lacks foundation is because the record that was before 
the Agency in December 2000 establishes that Hg is a HAP of concern 
only as emitted from coal-fired units, not oil-fired units. Utility 
Study ES-5,13,27. EPA therefore should not have relied upon Hg 
emissions as a basis for finding it was appropriate to regulate oil-
fired units under section 112. (See, e.g., Utility Study ES-5, ES-
27.)
    \7\ The ``appropriate'' finding for oil-fired units stemmed 
primarily from EPA's concerns over the potential health effects of 
nickel from such units. As explained in the January 2004 proposed 
rule, the record before the Agency in December 2000 supported a 
distinction between nickel and the other HAP emitted from oil-fired 
units. See 69 FR 4688. We proposed that this distinction was 
reasonable based on the relative amount of nickel emitted from oil-
fired units and the health effects associated with such emissions. 
(See also Utility Study at ES-12 (noting higher population 
concentrations surrounding oil-fired units). At the time of the 
proposed rule, we recognized, however, the uncertainties in the data 
underlying our ``appropriate'' finding for oil-fired units based on 
nickel emissions, and for that reason solicited information as to 
whether nickel emissions from oil-fired plants currently pose a 
hazard to public health.
---------------------------------------------------------------------------

    Once EPA determined that it was ``appropriate'' to regulate coal- 
and oil-fired Utility Units under section 112 of the CAA, EPA next 
concluded that it was also ``necessary'' to regulate HAP emissions from 
such units under section 112. Interpreting the term ``necessary'' in 
section 112(n)(1)(A), EPA found that it was necessary to regulate HAP 
from coal- and oil-fired Utility Units ``because the implementation of 
other requirements under the CAA will not adequately address the 
serious public health and environmental hazards arising from such 
emissions identified in the Utility RTC.'' See 65 FR 79830.
    In light of the positive appropriate and necessary determination, 
EPA in December 2000 listed coal- and oil-fired Utility Units on the 
section 112(c) source category list. See 65 FR 79831 (our finding that 
it is appropriate and necessary to regulate coal- and oil-fired Utility 
Units under section 112 ``adds these units to the list of source 
categories under section 112(c).''). Relying on CAA section 112(e)(4), 
EPA explained in its December 2000 finding that neither the appropriate 
and necessary finding under section 112(n)(1)(A), nor the associated 
listing were subject to judicial review at that time. EPA did not add 
natural-gas fired units to the section 112(c) list in December 2000 
because it did not make a positive appropriate and necessary finding 
for such units.

B. Litigation Challenging December 2000 Regulatory Finding

    Shortly after issuance of the December 2000 Finding, an industry 
group challenged the December 2000 finding in the United States Court 
of Appeals for the District of Columbia Circuit (DC Circuit). UARG v. 
EPA, 2001 WL 936363, No. 01-1074 (DC Cir. July 26, 2001). EPA moved to 
dismiss the lawsuit on the basis of section 112(e)(4), which provides, 
in pertinent part, that ``no action of the Administrator * * * listing 
a source category or subcategory under subsection (c) of this section 
shall be a final agency action subject to judicial review, except that 
any such action may be reviewed under such section 7607 of this title 
when the Administrator issues emission standards for such pollutant or 
category.'' (Emphasis added.) (See CAA Section 112(e)(4).)
    In its motion to dismiss the petition, EPA argued to the DC 
Circuit, among other things, that the December 2000 listing of coal- 
and oil-fired Utility Units was inseparable from the appropriate and 
necessary finding and that the appropriate and necessary finding and 
listing actions are not final agency actions pursuant to section 
112(e)(4). See also 65 FR 79826. EPA further noted in its motion to 
dismiss that both the finding and the listing would be subject to 
additional notice and comment as part of the section 112(d) rulemaking. 
See EPA's Motion to Dismiss, UARG v. EPA, 2001 WL 936363, No. 01-1074S 
(``Because the decision to add coal and oil fired electric utility 
steam generating units to the source category list is not yet final 
agency action, it will be among the matters subject to further comment 
in the subsequent [standards] rulemaking.''); 65 FR 79831 (noting that 
issues related to the listing, such as ``the exact dimension of the 
source category,'' will be subject to additional comment in the 
emission standard rulemaking process). The DC Circuit dismissed the 
challenge to the December 2000 finding for lack of jurisdiction based 
on section 112(e)(4) of the CAA. The December 2000 finding and 
associated listing are therefore not final agency actions.

C. January 30, 2004 Proposed Rule and March 2004 Supplemental Notice

    On January 30, 2004, EPA published in the Federal Register a 
proposed rule entitled ``Proposed National Emissions Standards for 
Hazardous Air Pollutants; and, in the Alternative, Proposed Standards 
of Performance for New and Existing Stationary Sources: Electric 
Utility Steam Generating Units.'' (See 69 FR 4652 (January 30, 2004).) 
In that rule, EPA proposed three alternative regulatory approaches. 
First, EPA proposed to retain the December 2000 Finding and associated 
listing of coal- and oil-fired Utility Units and to issue under section 
112(d) maximum achievable control technology-based (MACT) emission 
standards for both subcategories. Second, EPA alternatively proposed 
revising the Agency's December 2000 Finding, removing coal and oil-
fired Utility Units from the section 112(c) list,\8\ and issuing final 
standards of performance under CAA section 111 for new and existing 
coal-fired units that emit Hg and new and existing oil-fired units that 
emit nickel. Finally, as a third alternative, EPA proposed retaining 
the December 2000 finding, removing coal and oil-fired Utility Units 
from the section 112(c) list, and regulating Hg emissions from Utility 
Units under CAA section 112(n)(1)(A).
---------------------------------------------------------------------------

    \8\ We did not propose revising the December 2000 finding for 
gas-fired Utility Units because EPA continues to believe that 
regulation of such units under section 112 is not appropriate and 
necessary. We have not received any information that would cause us 
to change our conclusion in this regard. In fact, the information 
that we have received since the Utility Study only confirms the 
conclusion we reached in December 2000. We therefore take no action 
today with regard to the December 2000 finding for gas-fired Utility 
Units.
---------------------------------------------------------------------------

    Shortly thereafter, on March 16, 2004, EPA published in the Federal 
Register a supplemental notice of proposed rulemaking entitled 
``Supplemental Notice of Proposed National Emission Standards for 
Hazardous Air Pollutants; and, in the Alternative, Proposed Standards 
of Performance for New and Existing Stationary Sources: Electric 
Utility Steam Generating Units.'' See 69 FR 13298 (March 16, 2004). In 
that

[[Page 15997]]

notice, EPA proposed certain additional regulatory text, which largely 
governed the proposed section 111 standards of performance for Hg, 
which included a cap-and-trade program. The supplemental notice also 
proposed state plan approvability criteria and a model cap-and-trade 
rule for Hg emissions from coal-fired Utility Units. The Agency 
received thousands of comments on the proposed rule and supplemental 
notice.\9\ Comments relating to the central issues concerning today's 
action are addressed in this preamble. The remainder of our responses 
are contained in the response to comments document which is in the 
docket.\10\
---------------------------------------------------------------------------

    \9\ We initially estimated that we had over 680,000 submissions 
from the public on the proposed rule and the supplemental notice, 
which came primarily in the form of letters and e-mails. A recent 
review of the electronic docket reveals that our initial estimate 
was over-stated. The docket reflects approximately 500,000 separate 
submissions from the public, about 5,000 of which represent unique 
comments.
    \10\ The response to comments document relevant to this rule is 
called: ``Response to Significant Public Comments Concerning the 
Proposed Revision of the December 2000 Appropriate and Necessary 
Finding and Proposed Removal of Utility Units From the Section 
112(c) List.''
---------------------------------------------------------------------------

D. The December 2004 Notice of Data Availability

    On December 1, 2004, EPA published in the Federal Register a notice 
of data availability entitled ``Proposed National Emission Standards 
for Hazardous Air Pollutants; and, in the Alternative, Proposed 
Standards of Performance for New and Existing Stationary Sources, 
Electric Utility Steam Generating Units: Notice of Data Availability.'' 
See 69 FR 69864 (December 1, 2004). EPA issued this notice to seek 
additional information and input concerning: (1) Certain Hg data and 
information that the Agency received in response to the proposed rule 
and supplemental notice, (2) the different forms of Hg that are emitted 
into the atmosphere from coal-fired Utility Units and how those forms 
respond to different control technologies; and (3) a revised proposed 
benefits methodology for assessing the benefits of Hg regulation. The 
benefits methodology generally involves analyzing Hg emissions from 
coal-fired Utility Units, conducting deposition modeling based on the 
identified Hg emissions, and relating that deposition modeling to 
methylmercury concentrations in fish. EPA conducts benefits analyses 
for rulemakings consistent with the provisions of Executive Order 
12866.

III. EPA's Interpretation of CAA Section 112(n)(1)(A)

    As explained above, Congress treated Utility Units differently from 
other major and area sources and provided EPA considerable discretion 
in evaluating whether to regulate Utility Units under section 112. 
Section 112(n)(1)(A) provides, in full:

    The Administrator shall perform a study of the hazards to public 
health reasonably anticipated to occur as a result of emissions by 
electric utility steam generating units of pollutants listed under 
subsection (b) of this section after imposition of the requirements 
of this Act. The Administrator shall report the results of this 
study to the Congress within 3 years after the date of the enactment 
of the Clean Air Act Amendments of 1990. The Administrator shall 
develop and describe in the Administrator's report to Congress 
alternative control strategies for emissions which may warrant 
regulation under this section. The Administrator shall regulate 
electric utility steam generating units under this section, if the 
Administrator finds such regulation is appropriate and necessary 
after considering the results of the study required by this 
subparagraph.

(Emphasis added.).

    The italicized terms in the above paragraph are central terms in 
section 112(n)(1)(A). Before we address our interpretation of these 
terms, however, we again summarize the requirements of section 
112(n)(1)(A). The first step under section 112(n)(1)(A), which is 
addressed by the first three sentences of section 112(n)(1)(A), 
concerns the completion of a study and submission of the results of 
that study to Congress by November 15, 1993. The study is to examine 
the hazards to public health from utility HAP emissions that are 
reasonably anticipated to occur following imposition of the 
requirements of the CAA and to identify alternative control strategies 
for those HAP that may warrant regulation under section 112. The second 
step, which is addressed by the last sentence of section 112(n)(1)(A), 
requires EPA to determine whether regulation of Utility Units under 
section 112 is appropriate and necessary considering, among other 
things, the results of the study. Congress provided no deadline by 
which this determination must be made.
    Section 112(n)(1)(A) itself contains no clear standard to govern 
EPA's analysis and determination of whether it is ``appropriate and 
necessary'' to regulate utilities under section 112. The first sentence 
of the subparagraph describes the scope of the study EPA was to 
conduct. The sentence on EPA's ``appropriate and necessary'' finding 
then says that the Agency must make that finding after considering the 
results of the study. But Congress did not supply an actual definition 
or test for determining whether regulation of utilities under section 
112 is ``appropriate and necessary.'' Thus, EPA must supply a 
reasonable interpretation of those terms to fill the gap. Chevron USA 
Inc. v. NRDC, 467 U.S. 837 (1984).
    Congress' direction on the study provides the only guidance in 
section 112(n)(1)(A) about the substance of EPA's inquiry. Because the 
statute provides no other explicit guidance, EPA has chosen to 
extrapolate from Congress' description of the study to adopt a 
reasonable interpretation of the phrase ``appropriate and necessary.'' 
The following sections describe how the Agency has used Congress' 
guidance on the study to formulate different aspects of our 
interpretation and application of the ``appropriate and necessary'' 
test.

A. Hazards to Public Health Reasonably Anticipated To Occur

    In section 112(n)(1)(A), Congress directed EPA to perform a study 
of ``hazards to public health'' that would likely result from utility 
HAP emissions, before making any further decisions about regulating 
utilities under section 112. Unlike other sections of the CAA, section 
112(n)(1)(A) focuses only on hazards to public health. It does not 
require that EPA study other factors, such as environmental effects 
without any established pathways to human health effects. In contrast, 
section 112(n)(1)(B) requires a separate EPA study, although not as a 
precursor to a regulatory determination, of the ``health and 
environmental effects'' of ``mercury emissions'' from a broad range of 
sources. Also unlike Section 112(n)(1)(A), many of the other 
requirements of section 112 explicitly require both an assessment of 
human health effects and, in addition, an assessment of adverse 
environmental effects. For example, the Administrator is charged with 
periodically reviewing the list of Hazardous Air Pollutants and adding 
pollutants that present a threat of either ``adverse human health 
effects'' or ``adverse environmental effects.'' CAA Section 112(b)(2). 
The Administrator examines area sources of HAPs to determine if they 
present ``a threat of adverse effects to human health or the 
environment.'' CAA Section 112(c)(3). The Administrator is to 
prioritize action under section 112(d) after considering ``the known or 
anticipated adverse effects of such pollutants on public health and 
environment.'' CAA Section 112(e)(2)(A). Nor did Congress appear to 
view the two terms as synonymous. Under section 112(f), the EPA

[[Page 15998]]

promulgates emission standards at a level ``with an ample margin of 
safety'' to ``protect public health.'' CAA Section 112(f)(2)(A). The 
Administrator may go further and impose more stringent standards to 
protect against ``an adverse environmental effect'' only after 
considering ``cost, energy, safety, and other relevant factors.'' Id.
    As described above, section 112(n)(1)(A) also provides no clear 
standard for analyzing public health effects--in contrast to, for 
example, section 112(f). Under section 112(f), the issue is whether 
additional regulation is needed to ``provide an ample margin of safety 
to protect public health.'' Section 112(f) also expressly incorporates 
EPA's pre-1990 two-part inquiry for evaluating what level of emission 
reduction is needed to provide an ample margin of safety to protect 
public health. See CAA section 112(f)(2)(B) (incorporating EPA's two-
part ample margin of safety inquiry, set forth at 54 FR 38044 September 
14, 1989, which implemented the requirements of section 112 of the 1977 
CAA).\11\ By contrast, section 112(n)(1)(A) neither includes the 
``ample margin of safety to protect public health'' requirement, nor 
does it incorporate EPA's pre-1990 ample margin of safety inquiry.
---------------------------------------------------------------------------

    \11\ Section 112 of the 1977 CAA directed EPA to promulgate 
emission standards ``at the level which in * * * [the 
Administrator's judgment] provides an ample margin of safety to 
protect the public health.'' Congress substantially amended section 
112 in 1990 and enacted several new provisions. Congress 
specifically incorporated the ``ample margin of safety to protect 
public health'' requirement into section 112(f), which applies to 
any source category that is regulated under section 112(d)(2) and 
(d)(3). Significantly, Congress did not include the ``ample margin 
of safety'' language in section 112(n)(1)(A). Instead, Congress 
directed EPA to assess the ``hazards to public health reasonably 
anticipated to occur'' from utility HAP emissions after imposition 
of the requirements of the CAA, and then determine whether Utility 
unit emissions should be regulated under section 112 of the CAA.
---------------------------------------------------------------------------

    Because of the focus on ``public health'' in the section 
112(n)(1)(A) study requirement, and because as discussed above Congress 
did not define the scope of the ``appropriate and necessary'' finding, 
EPA is reasonably interpreting section 112(n)(1)(A) to base that 
finding on an assessment of whether utility HAP emissions likely would 
result in ``hazards to public health.''
    Moreover, EPA reasonably interprets section 112(n)(1)(A) not to 
require the Agency either to study or to base its ``appropriate and 
necessary'' finding on an assessment of environmental effects unrelated 
to public health.
    As described above, Section 112(n)(1)(A) requires only that the 
Administrator ``consider'' the results of the public health study 
before determining whether utility regulation is ``appropriate and 
necessary.'' This mild direction, when paired with the considerable 
discretion inherent in any judgment about whether an action is 
``appropriate and necessary,'' has led EPA to conclude that the statute 
permits the agency to consider other relevant factors when determining 
whether to regulate emissions from utility units under section 112. 
This is not to say, however, that EPA believes it may ignore the 
context of section 112(n) in making its determination.
    The Supreme Court has recognized that ``where Congress includes 
particular language in one section of a statute but omits it in another 
section of the same Act,'' as here, where section 112(n)(1)(A) refers 
to public health and conspicuously omits any reference to adverse 
environmental effect, ``it is generally presumed that Congress acts 
intentionally * * * in the disparate inclusion or exclusion.'' Russello 
v. United States, 464 U.S. 16, 23 (1983). The only direction that 
Congress explicitly provided to guide our ``appropriate and necessary'' 
finding was that we consider the results of a study of only those 
``hazards to public health'' that the agency ``reasonably anticipate[s] 
to occur.''
    EPA must reconcile the broad discretion to determine what is 
``appropriate and necessary'' with the implicit Congressional decision 
that information about environmental effects unrelated to human health 
effects was not needed for that determination. Rather than conclude 
that EPA is prohibited from considering environmental effects, however, 
EPA interprets section 112(n)(1)(A) to permit the agency to consider 
other relevant factors as part of its ``appropriate and necessary'' 
determination, as refined further below, but these factors may not 
independently, or in conjunction with one another, justify regulation 
under section 112(n) when EPA has concluded that hazards to U.S. public 
health are not reasonably anticipated to occur. Compare CAA section 
112(f)(2)(A) (Administrator may set a more stringent standard than is 
required to protect health if necessary, considering factors such as 
cost, to prevent an adverse environmental effect).
    In evaluating hazards to public health under section 112(n)(1)(A) 
we look at various factors, including, for example, the affected 
population, the characteristics of exposure (e.g., level and duration), 
the nature of the data, including the uncertainties associated with the 
data, and the nature and degree of health effects. In terms of 
assessing health effects, we have numerous tools at our disposal. See 
Section VI.H (for fuller discussion of factors relevant to assessing 
the hazards to public health). For example, for cancer effects, we can 
assess the lifetime excess cancer risk, and for other effects, we look 
to tools, such as the reference dose.\12\ As explained below, the 
``hazards to public health reasonably anticipated to occur'' standard 
is relevant not only for the Study, but also for the appropriate and 
necessary determination.
---------------------------------------------------------------------------

    \12\ Section VI below discusses the reference dose (``RfD'') in 
detail.
---------------------------------------------------------------------------

    EPA has also taken note of the context for assessing ``hazards to 
public health,'' for the language of section 112(n)(1)(A), calls for an 
analysis of the ``hazards to public health'' reasonably anticipated to 
``occur as a result of emissions by electric utility steam generating 
units.'' (Emphasis added.) Section 110(a)(2)(D) provides an instructive 
comparison in this regard. In section 110(a)(2)(D), Congress required 
that each state implementation plan contain adequate provisions 
``prohibiting * * * any source or other type of emissions activity 
within the State from emitting any air pollutant in amounts'' that will 
``contribute significantly to nonattainment'' of the national ambient 
air quality standards. This provision demonstrates that Congress knew 
how to require regulation of emissions of air pollutants even where the 
pollutants themselves do not cause a problem, but rather only 
``contribute to a problem.'' Unlike section 110(a)(2)(D), in section 
112(n)(1)(A), Congress focused exclusively on the ``hazards to public 
health'' of HAP emissions ``result[ing] from'' Utility Units. Rather, 
it is the EPA study performed pursuant to section 112(n)(1)(B), not the 
inquiry under section 112(n)(1)(A), that examines all current 
anthopogenic sources of Hg emissions and their effects on human health 
and the environment. EPA has concluded that its inquiry under section 
112(n)(1)(A) may reasonably focus solely on whether the utility HAP 
emissions themselves are posing a hazard to public health. This focus 
on utility emissions only is consistent with Congress' overall decision 
to provide for separate treatment of utilities in section 112(n)(1)(A).

B. Imposition of the Requirements of This Act

    Congress required EPA to examine the hazards to public health from 
utility emissions ``after imposition of the requirements of this Act.'' 
The phrase ``imposition of the requirements of th[e] Act'' is 
susceptible to different

[[Page 15999]]

interpretations because Congress did not specify the scope of the 
requirements under the CAA to be considered or, more importantly, the 
time period over which the imposition of requirements was to be 
examined. EPA reasonably interprets the phrase ``imposition of the 
requirements of th[e] Act'' to include not only those requirements 
already imposed and in effect, but also those requirements that EPA 
reasonably anticipates will be implemented and will result in 
reductions of utility HAP emissions. This interpretation is reasonable 
in view of the fact that Congress called for the study to be completed 
within three years of enactment of the 1990 CAA Amendments. At such 
time, EPA could have only forecast, to the extent possible, how 
implementation of the requirements of the CAA would impact utility HAP 
emissions, based on the science and the state of technology at the 
time.\13\
---------------------------------------------------------------------------

    \13\ Although the December 2000 finding does not provide an 
interpretation of the phrase ``after imposition of the requirements 
of the[e] Act,'' the Utility Study, on which that finding was based, 
does account for the phrase by evaluating utility HAP emission 
levels in 2010. See Utility Study ES-2 (the ``2010 scenario was 
selected to meet the section 112(n)(1)(A) mandate to evaluate 
hazards `after imposition of the requirements of 'the CAA.''). We do 
not believe that the December 2000 finding or the January 2004 
proposal properly give effect to all of the terms of section 
112(n)(1)(A), including the first sentence of section 112(n)(1)(A). 
We therefore provide our interpretation of the central terms in that 
sentence above, as those terms are relevant to the final actions we 
are taking today.
---------------------------------------------------------------------------

    We are interpreting the phrase ``requirements of th[e] Act'' 
broadly to include CAA requirements that could either directly or 
indirectly result in reductions of utility HAP emissions. For example, 
certain provisions of the CAA that affect Utility Units, such as the 
requirements of Title I and Title IV, require controls on pollutants 
like SO2 or NOX. Although these pollutants are 
not HAP, the controls that are required to achieve the needed 
reductions have the added effect of reducing HAP emissions. Thus, given 
our interpretation of the phrase ``imposition of the requirements of 
th[e] Act,'' we read the first sentence of section 112(n)(1)(A) as 
calling for a study of the hazards to public health from utility HAP 
emissions that EPA reasonably anticipates would occur after 
implementation of the CAA requirements that EPA, at the time of the 
study, should have reasonably anticipated would be implemented and 
would directly or indirectly result in reductions of utility HAP 
emissions.
    Finally, it is telling that Congress directed EPA to examine the 
utility HAP emissions remaining ``after imposition of the requirements 
of th[e] Act,'' because there is no other provision in section 112 that 
calls for EPA to examine the requirements of the CAA in assessing 
whether to regulate a source category under section 112.\14\ Congress 
plainly treated Utility Units differently from other source categories, 
and that special treatment reveals Congress' recognition that Utility 
Units are a broad, diverse source category that is subject to numerous 
CAA requirements, including requirements under both Title I and Title 
IV, and that such sources should not be subject to duplicative or 
otherwise inefficient regulation.\15\ See 136 Cong. Rec. H12911, 12934 
(daily ed. Oct. 26, 1990) (Statement of Congressman Oxley) (stating 
that the conferees adopted section 112(n)(1)(A) ``because of the logic 
of basing any decision to regulate on the results of scientific study 
and because of the emission reductions that will be achieved and the 
extremely high costs that electric utilities will face under other 
provisions of the new Clean Air Act amendments.'').
---------------------------------------------------------------------------

    \14\ Section 112(m)(6) provides an instructive comparison 
because it requires EPA to examine the other provisions of section 
112, and to determine whether those provisions are adequate to 
prevent serious adverse effects to public health and the environment 
associated with atmospheric deposition to certain waterbodies. 
Section 112(m)(6) also requires EPA to promulgate additional 
regulations setting emission standards or control requirements, ``in 
accordance with'' section 112 and under the authority of section 
112(m)(6), if EPA determines that the other provisions of section 
112 are adequate, and such regulations are appropriate and necessary 
to prevent serious adverse public health and environmental effects. 
Section 112(n)(1)(A) provides EPA far greater discretion because 
under that section, EPA is not only to evaluate the reasonably 
anticipated public health hazards remaining ``after imposition of 
the requirements of th[e] Act,'' but also to determine whether to 
regulate Utility Units under section 112 of the CAA at all.
    \15\ As noted elsewhere, section 112(n)(1)(A) was included in 
the House Committee bill and adopted by the House; while the Senate 
included a different provision. In the Conference Committee, the 
House version prevailed. Sen. Durenberger, a Senate conferee and an 
evident opponent of the provision, alluded to another purpose for 
the provision, which concerns the fact that ``mercury is a global 
problem.'' Legislative History of the Clean Air Act Amendments of 
1990, at 872 (Oct. 27, 1990) (statement of Sen. Durenberger). Based 
on Sen. Durenberger's statement, it appears that one of the reasons 
for the wide deference Congress accorded EPA under section 
112(n)(1)(A) was to allow EPA to account for the fact that Hg 
emissions from U.S. utilities are a very small part of overall Hg 
emissions, and therefore that EPA should exercise discretion in 
considering the uncontrollable amount of risk from Hg that would 
remain regardless of the extent to which U.S. utilities are 
controlled.
---------------------------------------------------------------------------

C. Appropriate and Necessary After Considering the Results of the Study

    Section 112(n)(1)(A) requires EPA to make a determination as to 
whether regulation of Utility Units under section 112 is ``appropriate 
and necessary.'' Congress did not define the terms ``appropriate'' and 
``necessary,'' but provided that regulation of Utility Units under 
section 112 could occur only if EPA determines that such regulation is 
both ``appropriate'' and ``necessary.''
1. Considering the Results of the Study
    The appropriate and necessary determination is to be made only 
after ``considering the results of the study'' required under section 
112(n)(1)(A). We interpret the phrase ``considering the results of the 
study'' to mean that EPA must consider the results of the study in 
making its determination, but that EPA is not foreclosed from analyzing 
other relevant information that becomes available after completion of 
the study. This interpretation is reasonable because section 
112(n)(1)(A) contains no deadline by which EPA must determine whether 
it is ``appropriate and necessary'' to regulate Utility Units under 
section 112.
    Moreover, nothing in section 112(n)(1)(A) suggests that EPA is 
precluded from considering new relevant information obtained after 
completion of the Utility Study in determining whether regulation of 
Utility Units under section 112 is appropriate and necessary. Indeed, 
the term ``considering'' in section 112(n)(1)(A) is analogous to the 
terms ``based on'' or ``including,'' which are neither limiting nor 
exclusive terms.\16\ In a recent case, the DC Circuit rejected an 
argument advanced by the petitioners that an EPA rule was invalid 
because the statute required EPA to promulgate the regulation ``based 
on the study,'' and according to petitioners EPA's rule was not based 
on a study that met the requirements of the CAA. Sierra Club v. EPA, 
325 F.3d 374 (DC Cir. 2003). In rejecting petitioners' arguments, the 
Court held, among other things, that ``the statute doesn't say that the 
rule must be based exclusively on the study.'' Sierra Club v. EPA, 325 
F.3d at 377 (emphasis in original); See also United States v. United 
Technologies Corp., 985 F.2d 1148, 1158 (2d Cir. 1993) (``based upon'' 
does not mean ``solely''); McDaniel v. Chevron Corp., 203 F.3d 1099, 
1111 (9th Cir. 2000). Consistent with this reasoning, EPA reasonably 
interprets the phrase ``considering the results of the study,'' to mean 
that EPA must consider the study, but that it can consider other 
relevant information obtained after completion of the study. Congress 
could not have reasonably intended for EPA to

[[Page 16000]]

ignore relevant information concerning HAP emissions from Utility Units 
solely because that information was obtained after completion of the 
Utility Study.\17\
---------------------------------------------------------------------------

    \16\ In fact, the term ``considering,'' on its face, is less 
limiting than the phrase ``based on.''
    \17\ Consistent with this interpretation, in December 2000, EPA 
relied not only on the Utility Study, but also on certain 
information concerning Hg obtained after completion of the study, 
including actual emissions data from coal-fired plants for calendar 
year 1999 and a report from the National Academy of Sciences on the 
health effects of methylmercury. See 65 FR 79825-27.
---------------------------------------------------------------------------

2. Appropriate and Necessary
    The condition precedent for regulating Utility Units under section 
112 is whether such regulation is ``appropriate'' and ``necessary.'' 
These are two very commonly used terms in the English language, and 
Congress has not ascribed any particular meaning to these terms in the 
CAA. The legislative history does not resolve Congress' intent with 
regard to these terms. We therefore first examine the structure of 
section 112(n)(1)(A) and then discuss our interpretation of the terms 
``appropriate'' and ``necessary.''
    a. Examining the Structure of Section 112(n)(1)(A). In interpreting 
the terms ``appropriate'' and ``necessary'' in section 112(n)(1)(A), we 
begin with the structure of section 112(n)(1)(A). As an initial matter, 
the order of the terms in the phrase ``appropriate and necessary'' 
suggests that the first decision EPA must make is whether regulation of 
Utility Units under section 112 is ``appropriate.'' Even if EPA 
determines that regulation of Utility Units under section 112 is 
appropriate, it must still determine whether such regulation is also 
necessary. Were EPA to find, however, that regulation of Utility Units 
under section 112 met only one prong, then regulating Utility Units 
under section 112 would not be authorized by the statute.
    The structure of section 112(n)(1)(A) also reveals that the 
appropriate and necessary finding is to be made by reference to the 
reasonably anticipated public health risks of utility HAP emissions 
that remain after ``imposition of the requirements of th[e] Act.'' The 
first sentence of section 112(n)(1)(A) contains an important direction 
to EPA, which sets the predicate for the entire provision. That first 
sentence calls for EPA to identify the hazards to public health 
reasonably anticipated to occur as a result of the utility HAP 
emissions remaining ``after imposition of the requirements of th[e] 
Act.'' Stated differently, Congress wanted EPA to identify the utility 
HAP emissions that would remain ``after imposition of the requirements 
of th[e] Act'' and identify the hazards to public health reasonably 
anticipated to occur as the result of such emissions. As noted above, 
we interpret the phrase ``imposition of the requirements of th[e] Act'' 
to include those CAA requirements that EPA should have reasonably 
anticipated would be implemented and would result in reductions of 
utility HAP emissions.\18\ Congress' focus on the other requirements of 
the CAA reflects its recognition that Utility Units are subject to 
numerous CAA provisions and its intent to avoid duplicative and 
unnecessary regulation. We therefore reasonably conclude that the 
appropriate and necessary finding is to be made by reference to the 
reasonably anticipated public health risks from utility HAP emissions 
that remain ``after imposition of the requirements of th[e] Act.''
---------------------------------------------------------------------------

    \18\ The comments of Rep. Oxley, a member of the Conference 
Committee, about section 112(n)(1)(A) support EPA's interpretation 
of that provision. Rep. Oxley stated:
    Pursuant to section 112(n), the Administrator may regulate 
fossil fuel fired electric utility steam generating units only if 
the studies described in section 112(n) clearly establish that 
emissions of any pollutant, or aggregate of pollutants, from such 
units cause a significant risk of serious adverse effects on the 
public health. Thus, if the Administrator regulates any of these 
units, he may regulate only those units that he determines--after 
taking into account compliance with all other provisions of the CAA 
and any other federal, state or local regulation and voluntary 
emission reductions--have been demonstrated to cause a significant 
threat of adverse effects on public health.
    136 Cong. Rec. H12911, 12934 (daily ed. Oct. 26, 1990) 
(Statement of Rep. Oxley) (emphasis added).
---------------------------------------------------------------------------

    b. EPA's interpretations of the terms ``appropriate'' and 
``necessary.'' (i) Appropriate. In December 2000, EPA found that it was 
appropriate to regulate coal- and oil-fired Utility Units under section 
112. At that time, we did not provide an interpretation of the term 
``appropriate.'' Instead, we focused on the following facts and 
circumstances. We first found that it was ``appropriate'' to regulate 
coal- and oil-fired Utility Units under section 112 because ``mercury 
in the environment presents significant hazards to public health.'' See 
65 FR 79830. We also determined that it was appropriate to regulate 
oil-fired Utility Units based on the uncertainties ``regarding the 
extent of the public health impact from HAP emissions from'' such 
units. See 65 FR 79830. Finally, we found that it was appropriate to 
regulate HAP emissions from coal-and oil-fired units under section 112 
because we had identified control options that we anticipated would 
effectively reduce certain HAP emissions. We also indicated that 
certain control options could ``greatly reduc[e] mercury control 
costs.'' See 65 FR 79830.
    In January 2004, we proposed reversing our ``appropriate'' finding 
in large part. Specifically, we proposed that it is not ``appropriate'' 
to regulate coal-fired units on the basis of non-Hg HAP and oil-fired 
units on the basis of non-Ni HAP because the record that was before the 
Agency in December 2000 indicates that emissions of such pollutants do 
not result in hazards to public health. See Section IV.B.
    Webster's dictionary defines the term ``appropriate'' to mean 
``especially suitable or compatible.'' Miriam-Webster's Online 
Dictionary, 10th ed. Determining whether something is ``especially 
suitable or compatible'' for a particular situation requires 
consideration of different factors. In section 112(n)(1)(A), Congress 
requires EPA to determine whether it is ``appropriate'' to regulate 
Utility Units under section 112. In making this determination, we begin 
as we did in December 2000, by assessing the paramount factor, which is 
whether the level of utility HAP emissions remaining ``after imposition 
of the requirements of th[e] Act'' would result in hazards to public 
health. We determine whether the remaining utility HAP emissions cause 
hazards to public health by analyzing available health effects data and 
assessing, among other things, the uncertainties associated with those 
data, the weight of the scientific evidence, and the extent and nature 
of the health effects. See Section VI. If the remaining HAP emissions 
from Utility Units do not result in hazards to public health, EPA does 
not believe that it would be ``especially suitable''--i.e., 
``appropriate''--to regulate such units under section 112. In this 
situation, there would be no need to consider any additional factors 
under the ``appropriate'' inquiry because the threshold fact critical 
to making a finding that it is appropriate to regulate Utility Units 
under section 112 would be missing.
    Even if the remaining utility HAP emissions cause hazards to public 
health, it still may not be appropriate to regulate Utility Units under 
section 112 because there may be other relevant factors particular to 
the situation that would lead the Agency to conclude that it is not 
``especially suitable'' or ``appropriate'' to regulate Utility Units 
under section 112. For example, it might not be appropriate to regulate 
the utility HAP emissions remaining ``after imposition of the 
requirements of th[e] Act,'' if the controls mandated under section 
112(d) would be ineffective at eliminating or reducing the identified 
hazards to public health. Similarly, it might not be appropriate to 
regulate the

[[Page 16001]]

remaining utility HAP emissions under section 112 if the health 
benefits expected as the result of such regulation are marginal and the 
cost of such regulation is significant and therefore substantially 
outweighs the benefits. These examples illustrate that situation-
specific factors, including cost, may affect whether it ``is 
appropriate'' to regulate utility HAP emissions under section 112.\19\ 
(See Section 112(n)(1)(A).)
---------------------------------------------------------------------------

    \19\ Nothing precludes EPA from considering costs in assessing 
whether regulation of Utility Units under section 112 is appropriate 
in light of all of the facts and circumstances presented. The DC 
Circuit has indicated that regulatory provisions should be read with 
a presumption in favor of considering costs: ``It is only where 
there is `clear congressional intent to preclude consideration of 
cost' that we find agencies barred from considering costs. 
[Citations omitted.]'' Michigan v. EPA, 213 F.3d 663, 678 (DC Cir. 
2000), cert. den., 532 U.S. 903 (2001) (upholding EPA's 
interpretation of ``contribute significantly'' under CAA section 
110(a)(2)(D) to include a cost component). The Supreme Court's 
decision in Whitman v. American Trucking Assn's (ATA), Inc., 531 
U.S. 457 (2001), is not to the contrary. In that case, the Court 
held that EPA lacked authority to consider costs in the context of 
setting the national ambient air quality standards under CAA section 
109(b)(1), because the ``modest words `adequate margin' and 
`requisite' ' in that section do not ``leave room'' to consider 
cost. 531 U.S. 466. By contrast, EPA is not setting emission 
standards in today's action, but rather determining, as Congress 
directed, whether it is ``appropriate'' and ``necessary'' to 
regulate Utility Units under CAA section 112. The terms 
``appropriate'' and ``necessary'' are broad terms, which by contrast 
to the terms at issue in ATA do, in fact, leave room for 
consideration of costs in deciding whether to regulate utilities 
under section 112. Moreover, the legislative history of section 
112(n) indicates that Congress intended for EPA to consider costs. 
See 136 Cong. Rec. H12911, 12934 (daily ed. Oct. 26, 1990) 
(statement of Rep. Oxley) (``[T]he conference committee produced a 
utility air toxics provision that will provide ample protection of 
the public health while avoiding the imposition of excessive and 
unnecessary costs on residential, industrial and commercial 
consumers of electricity.''). Finally, section 112(n)(1)(A) requires 
EPA to consider alternative control strategies, and the focus on 
such strategies may reasonably be read as further evidence of the 
relevance of costs. See, e.g., 65 FR 79830 (discussing costs in 
relation to certain technologies).
---------------------------------------------------------------------------

    It cannot be disputed that Congress under section 112(n)(1)(A) 
entrusted EPA to exercise judgment by evaluating whether regulation of 
Utility Units under section 112 is, in fact, ``appropriate.'' We 
believe that in exercising that judgment, we have the discretion to 
examine all relevant facts and circumstances, including any special 
circumstances that may lead us to determine that regulation of Utility 
Units under CAA section 112 is not appropriate.\20\
---------------------------------------------------------------------------

    \20\ Significantly, in December 2000, we acknowledged that 
factors other than the hazards to public health resulting from 
utility HAP emissions should be examined in determining whether 
regulation of Utility Units is appropriate under section 112. 
Indeed, after concluding that the Hg emissions from coal-fired 
Utility Units caused hazards to public health, we proceeded with the 
appropriate inquiry and examined whether there were any control 
technologies that could effectively reduce Hg. We also commented on 
the costs of achieving such reductions. See, e.g., 65 FR 79828, 
79830.
---------------------------------------------------------------------------

    (ii) Necessary. Like the ``appropriate'' finding, the ``necessary'' 
finding must be made by reference to the utility HAP emissions 
remaining after imposition of the requirements of the CAA.
    Specifically, we interpret the term ``necessary'' in section 
112(n)(1)(A) to mean that it is necessary to regulate Utility Units 
under section 112 only if there are no other authorities available 
under the CAA that would, if implemented, effectively address the 
remaining HAP emissions from Utility Units. Assessing whether an 
alternative authority would effectively address the remaining utility 
HAP emissions would involve not only: (a) An analysis of whether the 
alternative legal authority, if implemented, would address the 
identified hazards to public health, which was a concept specifically 
addressed in December 2000 and in the January 2004 proposal, but also 
(b) an analysis of whether the alternative legal authority, if 
implemented, would result in effective regulation, including, for 
example, its cost-effectiveness and its administrative effectiveness. 
See Michigan v. EPA, 213 F.3d, 663, 678 (addressing consideration of 
costs).
    This interpretation of the term ``necessary'' differs slightly from 
the interpretation advanced in December 2000 and January 2004. In 
December 2000 and January 2004, we interpreted the term ``necessary'' 
to mean that it is only necessary to regulate Utility Units under 
section 112 if there are no other authorities under the CAA that would 
adequately address utility HAP emissions. Several commenters noted that 
under this interpretation, EPA could never regulate HAP under section 
112 if it identified an alternative viable legal authority. In light of 
these comments and further review of section 112(n)(1)(A), we refined 
our interpretation of the term ``necessary'' as noted above. We agree 
that if we found an alternative authority under the CAA but we also 
determined that such authority would not effectively address the 
remaining HAP emissions, we should be able to address those emissions 
under section 112. Accordingly, we maintain that it is necessary to 
regulate Utility Units under section 112 only if there are no other 
authorities under the CAA that, if implemented, would effectively 
address the remaining HAP emissions from Utility Units.
    Some commenters argued that the ``appropriate and necessary'' 
finding is a public health threshold finding, not an investigation into 
whether another provision of the CAA would address HAP emissions from 
utilities. This argument is without merit, however, because it 
conflates the terms ``appropriate'' and ``necessary'' and renders one 
term mere surplusage. Congress required EPA to determine whether it was 
both appropriate and necessary to regulate Utility Units under section 
112. EPA agrees that it must evaluate the hazards to public health 
associated with HAP from utilities in terms of assessing whether 
regulation under section 112 is ``appropriate.'' But Congress meant 
something different by the term ``necessary,'' and EPA's interpretation 
of that term is reasonable. Moreover, we believe that the emissions 
inquiry envisioned under the first sentence of section 112(n)(1)(A) is 
distinct from the ``necessary'' inquiry called for by the last sentence 
of section 112(n)(1)(A), because under the ``necessary'' inquiry the 
issue is not whether EPA reasonably anticipated that a particular 
provision of the CAA will be implemented and will reduce HAP emissions, 
but rather whether there are any other authorities in the CAA that 
could be implemented, and if implemented, could effectively address the 
hazards to public health that result from the remaining HAP emissions.
    Other commenters argued that EPA cannot consider other statutory 
authorities under the ``necessary'' prong of the ``appropriate and 
necessary'' inquiry because those authorities do not provide for 
regulation of utility HAP according to the provisions of CAA section 
112(d) and (f). This argument is also without merit because it again 
renders mere surplusage the ``necessary'' prong of the determination. 
Moreover, as explained above, Congress did not incorporate the 
requirements of section 112(f) into section 112(n)(1)(A), but instead, 
as we interpret section 112(n)(1)(A), called on EPA to consider the 
``hazards to public health reasonably anticipated to occur'' from 
utility HAP emissions after imposition of the requirements of the CAA, 
in determining whether it is both appropriate and necessary to regulate 
Utility Units under section 112.
3. The Timing and Nature of the ``Appropriate and Necessary'' 
Determination
    Congress set no deadline in section 112(n)(1)(A) by which EPA must 
determine whether regulation of Utility Units is appropriate and 
necessary. We believe that Congress provided

[[Page 16002]]

sufficient discretion under section 112(n)(1)(A)--in terms of both the 
substance and the timing of the appropriate and necessary finding--that 
nothing precludes us from revising our appropriate and necessary 
finding if we determine either that the finding was in error based on 
information before the Agency at the time of the finding, or that the 
finding is incorrect given new information concerning utility HAP 
emissions obtained after issuance of the finding. Both of these 
situations are present here, as explained in section IV below.
    Moreover, EPA reasonably interprets the last sentence of section 
112(n)(1)(A) as authorizing EPA to issue separate appropriate and 
necessary findings for different subcategories of ``electric utility 
steam generating units.'' EPA typically subcategorizes large source 
categories such as utilities. This is especially true for Utility Units 
because the nature of the fuel used in different units (e.g., coal-, 
oil-, or gas-fired Utility Units), affects the type and amount of HAP 
emitted from the units, which, in turn, affects the issue of whether 
hazards to public health may exist from such emissions.\21\ Even where 
section 112(n)(1)(A) read to require EPA to make only one appropriate 
and necessary finding for all ``electric utility steam generating 
units,'' EPA's conclusions, as described below, would remain the same.
---------------------------------------------------------------------------

    \21\ We received no adverse comments concerning our 
subcategorization of Utility Units for purposes of section 
112(n)(1)(A).
---------------------------------------------------------------------------

IV. Revision of the December 2000 Appropriate and Necessary Finding

    In Section II above, we summarize the December 2000 appropriate and 
necessary finding for coal- and oil-fired Utility Units. In this 
section, we explain why we now believe that the December 2000 finding 
lacked foundation and therefore was erroneous. We also address below 
certain new information obtained since the finding that confirms that 
it is not appropriate and necessary to regulate coal- and oil-fired 
Utility Units under section 112. Our discussion below is divided into 
two sections, the first of which concerns the December 2000 finding for 
coal-fired units, and the second of which addresses the December 2000 
finding for oil-fired units.

A. Revision of the December 2000 Appropriate and Necessary Finding for 
Coal-fired Units

    The majority of the December 2000 finding concerned Hg emissions 
from coal-fired Utility Units. See, e.g., 65 FR 79826 (``mercury * * * 
is emitted from coal-fired units, and * * * is the HAP of greatest 
concern to public health from the industry.''); 65 FR 79829-30 
(conclusions section of December 2000 finding focuses almost 
exclusively on Hg); Utility Study, ES-27 (``mercury from coal-fired 
utilities is the HAP of greatest potential concern.''). For that 
reason, we first address how EPA erred in making the appropriate and 
necessary finding for coal-fired units based on Hg emissions. We then 
discuss the December 2000 finding for coal-fired units with regard to 
non-Hg HAP.
1. It Is Not Appropriate and Necessary To Regulate Coal-Fired Units on 
the Basis of Hg Emissions
    a. It Is Not Appropriate to Regulate Coal-fired Units on the Basis 
of Hg Emissions. As noted above, EPA's December 2000 ``appropriate'' 
finding is framed primarily in terms of health effects resulting from 
Hg emissions from coal-fired Utility Units.\22\ See 65 FR 79829. The 
December 2000 finding also discusses environmental effects, primarily 
in the context of public health. In particular, the appropriate finding 
discusses the effects of Hg on fish because the public's primary route 
of exposure to Hg is through consumption of fish containing 
methylmercury. See 65 FR 79829-30. See also Section VI (discussing 
health effects of Hg). The December 2000 finding also discusses briefly 
the effects of methymercury on certain fish-eating wildlife, such as 
racoons and loons. See 65 FR 79830.
---------------------------------------------------------------------------

    \22\ The ``appropriate'' rationale set forth in the December 
2000 finding focused exclusively on Hg with regard to coal-fired 
Utility Units. The December 2000 ``necessary'' finding can be read, 
however, to suggest that under the appropriate prong, EPA also 
determined that non-Hg from coal-fired Utility Units resulted in 
hazards to public health. See 65 FR 79830 (``It is necessary to 
regulate HAP emissions from coal- and oil-fired'' Utility Units 
under section 112 ``because the implementation of other requirements 
of the CAA will not address the serious public health and 
environmental hazards arising from such emissions.''). As explained 
below in section IV.B, the record that was before the Agency in 
December 2000 confirms that the non-Hg HAP emissions remaining 
``after imposition of the requirements of th[e] Act'' do not result 
in hazards to public health. In the proposed rule, EPA solicited 
comment on this issue. We did not receive any new information 
concerning non-Hg HAP during the comment period that would cause us 
to change our position as to these HAP.
---------------------------------------------------------------------------

    As explained above, EPA interprets section 112(n)(1)(A) as not 
requiring the Agency to consider environmental effects of utility HAP 
emissions that are unrelated to public health. Nevertheless, EPA 
believes it has authority under the ``appropriate'' inquiry to consider 
other factors, including non-public health related environmental 
factors. As explained above, however, given the focus in section 
112(n)(1)(A) on hazards to public health, we believe that environmental 
factors unrelated to public health, although they can be considered in 
the appropriate inquiry, may not independently or, in conjunction with 
one another, justify regulation of Utility Units under section 112 when 
EPA has concluded that hazards to public health are not reasonably 
anticipated to result from utility HAP emissions.
    EPA reasonably addressed non-public health related environmental 
factors, such as exposure to wildlife, in the December 2000 finding, 
because we separately concluded that Hg emissions from coal-fired 
Utility Units pose hazards to public health. As explained below, we 
believe that our December 2000 appropriate finding lacks foundation, 
and that conclusion is supported by certain recent information. 
Specifically, we conclude today that the level of Hg emissions 
remaining after imposition of the requirements of the Act will not 
cause hazards to public health, and therefore we need not consider 
other factors, such as non-public health related environmental effects. 
We do, of course, discuss the effects of Hg on fish, because the 
ingestion of fish contaminated with methylmercury is the public's 
primary route of exposure to Hg. See Section VI (discussing health 
effects of Hg).\23\
---------------------------------------------------------------------------

    \23\ We note, however, that as part of our overall inquiry into 
the effects of Hg emissions, we assessed the available information 
on the environmental effects of Hg emissions, including effects that 
appear to be unrelated to public health. See 1997 Mercury Report to 
Congress. While that information, in a very general sense, suggests 
that environmental effects of Hg emissions (unrelated to public 
health) may be of some concern and therefore warrant further study, 
the available information is not specific to the effects of Hg 
emissions from domestic utilities. See RIA Appendix C. Thus, even if 
EPA were either required or permitted to give unlimited 
consideration to these non-health-related environmental effects of 
utility Hg emissions in making the regulatory determination under 
section 112(n)(1)(A), we would conclude that there is insufficient 
causal information to conclusively link utility emissions to 
deleterious effects (in wildlife) from Hg exposure.
---------------------------------------------------------------------------

    As noted above, EPA's December 2000 appropriate finding for coal-
fired units hinged primarily on the health and environmental effects 
resulting from Hg emissions. See 65 FR 79830 (``mercury in the 
environment presents significant hazards to public health and the 
environment.''). This finding lacks foundation, however, for the 
reasons described below.
    (i) The December 2000 Appropriate Finding Is Overbroad To The 
Extent It Hinged On Environmental Effects. EPA should not have made its 
appropriate

[[Page 16003]]

finding because of ``hazards to * * * the environment'' resulting from 
Hg emissions from coal-fired Utility Units. Section 112(n)(1)(A) 
requires EPA to analyze only the ``hazards to public health'' resulting 
from utility HAP emissions, not the environmental effects caused by 
such emissions. Under section 112(n)(1)(A), the condition precedent for 
regulation under section 112 is public health hazards, not 
environmental effects, which Congress included in other provisions of 
section 112. See, e.g., 112(c)(3) (``a threat of adverse effect to 
human health or the environment.''). The Supreme Court has recognized 
that ``where Congress includes particular language in one section of a 
statute but omits it in another section of the same Act, it is 
generally presumed that Congress acts intentionally * * * in the 
disparate inclusion or exclusion.'' Russello v. United States, 464 U.S. 
16, 23 (1983). Accordingly, EPA erred in its December 2000 
``appropriate'' finding to the extent that it hinged on the 
environmental effects of HAP, including Hg.
    (ii) The December 2000 Appropriate Finding Lacks Foundation Because 
EPA Did Not Fully Consider The Hg Reductions That Would Result From 
``Imposition of the Requirements of th[e] Act.'' As explained above, 
EPA interprets section 112(n)(1)(A) as providing that the 
``appropriate'' finding should be made by reference to the level of HAP 
emissions remaining after ``imposition of the requirements of th[e] 
Act.'' We reasonably interpret the phrase ``imposition of the 
requirements of th[e] Act'' to include those requirements that EPA 
should have reasonably anticipated would be implemented and would 
result in reductions of utility HAP emissions.
    The December 2000 ``appropriate'' finding lacks foundation because 
EPA failed to fully account for the Hg emissions remaining after 
``imposition of the requirements of th[e] Act.'' \24\ That failure 
resulted in an overestimate of the remaining utility Hg emissions, 
which is the level of emissions that we considered in making our 
December 2000 appropriate finding. Had we properly considered the Hg 
reductions remaining ``after imposition of the requirements of th[e] 
Act'' in December 2000, we might well have (and, as discussed below, 
now believe should have) reached a different conclusion as to whether 
it was ``appropriate'' to regulate coal-fired units on the basis of Hg 
emissions.
---------------------------------------------------------------------------

    \24\ For ease of reference, we refer to the level of utility Hg 
emissions remaining ``after imposition of the requirements'' of the 
CAA as the ``remaining Hg emissions.''
---------------------------------------------------------------------------

    We begin our analysis with a brief background concerning the 
Utility Study. In an attempt to address the requirement in section 
112(n)(1)(A) of evaluating utility emissions ``after imposition of the 
requirements of th[e] Act'', the Utility Study estimates utility HAP 
emissions as of the year 2010. See Utility Study ES-1. In quantifying 
2010 utility HAP emissions, our analysis focused almost exclusively on 
the acid rain provisions of Title IV. Title IV of the CAA establishes a 
national, annual emissions cap for sulfur dioxide (SO2) 
emissions from Utility Units, which is to be implemented in two phases. 
Phase I commences January 1, 1995, and Phase II on January 1, 2000.
    EPA relied in the Utility Study on a 1997 Department of Energy 
report concerning the effects of the implementation of Title IV of the 
CAA on utilities. Utility Study 2-31 to 2-33, 2-39. That report 
provides that 53 percent of Utility Units subject to Phase 1 
requirements switched to a lower-sulfur coal, 27 percent purchased 
additional emissions allowances, and 16 percent (i.e., 27 Utility 
Units) installed flue gas scrubbers to comply with the Phase I 
requirements.\25\ In the 2010 utility HAP emissions analysis, EPA 
accounted for the 27 Utility Units that installed scrubbers to comply 
with the phase I requirements. Utility Study 2-31. EPA accounted for 
these scrubbers in the 2010 analysis because it recognized that 
scrubbers, which control SO2, achieve HAP reductions, 
including Hg.\26\ Utility Study at ES-19 & 25, 1-2, 2-32, 3-14 
(discussing ability of PM controls (including SO2 controls) 
to reduce Hg and other HAP emissions from Utility Units).\27\ 
Significantly, however, EPA did not incorporate into the 2010 utility 
HAP emissions analysis the Hg reductions that we reasonably should have 
anticipated achieving through implementation of the requirements of 
Title I of the CAA. See Utility Study, at 2-31 to 2-33. In this regard, 
EPA erred in, at least, two respects.
---------------------------------------------------------------------------

    \25\ Flue gas scrubbers are a type of control technology used to 
control SO2.
    \26\ EPA did not account in its 2010 analysis for the 
installation of any scrubbers associated with Phase II of the acid 
rain program, because it only had industry projections as to which 
units would install scrubbers and, for various reasons, it did not 
find those projections reliable. Utility Study 2-31 to 2-33.
    \27\ In the December 2000 finding, we indicate that recent data 
show that technologies used to control criteria pollutants, like PM, 
SO2, and NOX are not ``effective'' in 
controlling Hg. See 65 FR 79828. This statement is incorrect. It is 
not only inconsistent with other statements in the December 2000 
finding, it is contrary to the record that was before the Agency in 
December 2000. The record indicates that technologies used to 
control PM, SO2, and NOX do reduce HAP, 
including Hg. Furthermore, insofar as Hg is concerned, these 
technologies result in important reductions of oxidized Hg, which is 
the type of Hg that tends to deposit locally and regionally. Utility 
Study at ES-19 & 25, 1-2, 2-32, 3-14.
---------------------------------------------------------------------------

    First, EPA erred by not accounting for the utility Hg reductions 
that it should have reasonably anticipated would result from 
implementation of the nonattainment provisions of Title I, including, 
in particular, the revised NAAQS for ozone that EPA issued in July 
1997, before the report was completed, under the nonattainment 
provisions.\28\ The Utility Study expressly recognizes that the revised 
NAAQS would result in, among other things, significant reductions of 
SO2 and NOX. See generally Utility Study at 1-2 
to 1-3. The Utility Study also indicates that the revised NAAQS would 
result in approximately a 16 percent reduction (11 tons per year) of Hg 
emissions by 2010, primarily due to the fact that Utility Units would 
need to install controls, like scrubbers, to meet the SO2 
reductions needed to attain the PM NAAQS. (Utility Study 1-3, ES-25, 3-
14). Notwithstanding these significant estimated reductions, EPA did 
not take these reductions into account in its 2010 utility HAP 
emissions analysis.\29\ ES-25 (``analyses performed to assess 
compliance with the revised NAAQS * * * indicate that Hg emissions in 
2010 may be reduced by approximately 16 percent (11 tpy) over those 
projected in this report.''). Accordingly, the December 2000 
appropriate finding lacks foundation because we made the finding based 
on an inaccurate level of Hg emissions remaining after imposition of 
the requirements of the CAA. Had we properly accounted in December 2000 
for the 11 tons per year of Hg reductions that we projected in our own 
analyses, we might well have (and, as discussed below, now believe 
should have) concluded that it was not appropriate to regulate coal-
fired units under section

[[Page 16004]]

112 on the basis of the remaining Hg emissions. Indeed, recent modeling 
confirms that we likely would have reached such a conclusion. That 
modeling specifically demonstrates that about a 13 ton reduction in 
utility Hg emissions from 1990 levels would result in a level of Hg 
emissions that does not cause hazards to public health. We conducted 
these recent analyses in conjunction with the recently signed Clean Air 
Interstate Rule (``CAIR'') issued pursuant to CAA section 110(a)(2)(D), 
which is explained more fully in section V below.
---------------------------------------------------------------------------

    \28\ For additional background concerning the nonattainment 
provisions of Title I and the revised PM and ozone NAAQS, see 
Section V below.
    \29\ In the Utility Study, we explained that we did not account 
for the identified Hg reductions in the 2010 analysis because we 
lacked information on the specific number of units that would 
install scrubbers and related PM control technologies since we had 
not yet designated which areas of the country were in nonattainment 
of the revised NAAQS. See Utility Study 2-32. Although we had not 
yet designated areas of the country as being in nonattainment of the 
revised standards, as explained in section V, we were generally 
aware of the likelihood of widespread nonattainment with the revised 
NAAQS. In fact, that recognition formed the basis of our analysis 
that resulted in an estimated 16 percent reduction in Hg emissions 
from implementation of the revised NAAQS.
---------------------------------------------------------------------------

    Second, EPA erred in December 2000 by not examining, and therefore 
not accounting for, the reductions in utility Hg emissions that would 
result from two other rules issued pursuant to Title I of the CAA. The 
first rule set new source performance standards (``NSPS'') under CAA 
section 111(b) for NOX emitted from utility and industrial 
boilers. The second rule, promulgated under CAA section 110(a)(2)(D), 
requires 22 states and the District of Columbia to revise their state 
implementation plans (``SIP'') to mitigate for the interstate transport 
of ozone. This rule is called the NOX SIP-call rule and 
requires significant reductions of NOX emissions in the 
eastern half of the United States. EPA determined those NOX 
reductions by analyzing Utility Units and large nonpoint utility 
sources and identifying the amount of reductions that those units could 
achieve in a ``highly cost-effective'' manner. Both the NOX 
SIP call and the NSPS rule were premised on a NOX control 
technology called selective catalytic reduction (``SCR''). The data on 
the effectiveness of SCR at controlling utility Hg emissions was 
limited in February 1998. See Utility Study 2-32. As of December 2000, 
however, EPA had additional data that confirmed that SCR would lead to 
certain reductions in utility Hg emissions. See, e.g., 65 FR 79829 
(SCR--a NOX control technology ``may also oxidize mercury 
and therefore enhance mercury control.''). EPA therefore should have 
been able to reasonably estimate in December 2000 that some Hg 
reductions would occur as the result of implementation of the NSPS and 
the NOX SIP-call rules. Because we did not account for 
reductions in utility Hg emissions as the result of implementation of 
these rules, we made our appropriate finding in December 2000 based on 
an incorrect estimate of the remaining Hg utility emissions. Based on 
all of the above, the December 2000 ``appropriate'' finding lacked 
foundation because it was not based on the level of utility Hg 
emissions remaining ``after imposition of the requirements of th[e] 
Act.''
    (iii) It Is Not Appropriate to Regulate Coal-fired Utility Units 
Under Section 112 on the Basis of Hg Emissions Because New Information 
Reveals that the Level of Utility Hg Emissions Remaining After 
Imposition of the Requirements of the CAA Does Not Cause Hazards to 
Public Health. In addition to the errors noted above with regard to the 
December 2000 finding, we have new information that confirms that it is 
not appropriate to regulate coal-fired units under section 112 on the 
basis of Hg emissions. EPA recently signed a rulemaking implementing 
section 110(a)(2)(D), called the Clean Air Interstate Rule. (See 
Section V below for further discussion of CAIR.) This rulemaking, among 
other things, requires a number of eastern states to develop SIPs 
providing for substantial reductions of SO2 and 
NOX emissions. Although affected states retain flexibility 
to decide how to achieve those reductions, EPA has concluded that the 
reductions from Utility Units are highly cost-effective, and 
anticipates that affected states will meet their emission reduction 
obligations by controlling Utility Unit emissions. EPA also concluded 
that the technologies that most cost-effectively achieve SO2 
and NOX reductions for Utility Units are scrubbers for 
SO2 and SCR for NOX. These technologies, as noted 
above, result in reductions of utility Hg emissions. In conjunction 
with the CAIR rulemaking, EPA analyzed the nature of Hg emissions that 
would remain after implementation of the rule and assumed that states 
would choose to regulate Utility Units, which is the most cost-
effective option for achieving the required reductions. That modeling 
reveals that the implementation of section 110(a)(2)(D), through CAIR, 
would result in a level of Hg emissions from Utility Units that would 
not cause hazards to public health. See Section V for further detail. 
Because this new information demonstrates that the level of Hg 
emissions projected to remain ``after imposition of'' section 
110(a)(2)(D) does not cause hazards to public health, we conclude that 
it is not appropriate to regulate coal-fired Utility Units under 
section 112 on the basis of Hg emissions.\30\
---------------------------------------------------------------------------

    \30\ The reductions achieved through CAIR overlap, in part, with 
the 11 tons per year of reductions discussed in the prior section, 
which EPA estimated in 1998 would occur as the result of 
implementation of the revised NAAQS. The reductions necessarily 
overlap because in the Utility Study EPA projected forward 13 years, 
by examining utility HAP emissions in 2010. In analyzing the level 
of utility Hg emissions remaining ``after imposition of [section 
110(a)(2)(D)]'' through CAIR, we are accounting for the full impact 
of CAIR and that necessarily includes reductions that occur between 
today and 2010, and beyond. See Section V (discussing requirements 
of CAIR in 2010 and 2015).
---------------------------------------------------------------------------

    In addition to CAIR, we today finalized a rule pursuant to section 
111, called the Clean Air Mercury Rule (``CAMR''). (See section VII 
below for further discussion of CAMR.) That rule requires even greater 
reductions in Hg emissions from coal-fired Utility Units than CAIR. As 
explained in greater detail in Section VI, the computer modeling 
completed in support of that rule, like the modeling completed on CAIR, 
demonstrates that CAMR, independent of CAIR, will result in levels of 
utility Hg emissions that do not result in hazards to public health. 
Thus, the implementation of CAMR provides an independent basis for our 
conclusion that it is not appropriate to regulate coal-fired Utility 
Units under section 112 because the utility Hg emissions remaining 
after implementation of section 111 will be at a level that results in 
no hazards to public health.\31\
---------------------------------------------------------------------------

    \31\ Nothing in section 112(n)(1)(A) precludes EPA from revising 
a prior appropriate and necessary finding based on new information. 
In light of CAIR and, independently, CAMR, we can now reasonably 
anticipate the reductions in utility Hg emissions that would result 
from implementation of sections 110(a)(2)(D) and 111 of the CAA. 
Accordingly, we are accounting for those reductions in assessing the 
level of utility Hg emissions remaining after ``imposition of the 
requirements of th[e] Act,'' which include section 110(a)(2)(D) and 
111. We then based our new appropriate finding on these remaining Hg 
emissions.
---------------------------------------------------------------------------

    b. It Is Not Necessary to Regulate Coal-fired Units on the Basis of 
Hg Emissions. Even if Congress had intended EPA to focus on a more 
limited set of requirements in interpreting the phrase ``after 
imposition of the requirements of th[e] Act,'' that would mean only 
that EPA did not err in December 2000 in terms of its ``appropriate'' 
finding for coal-fired units based on Hg emissions. EPA nevertheless 
concludes today that it still erred in December 2000 with regard to its 
``necessary'' finding. In section 112(n)(1)(A), Congress called on EPA 
to make a finding as to whether regulation of Utility Units under 
section 112 was not only ``appropriate,'' but ``necessary.'' To give 
effect to the term ``necessary,'' we interpret the ``necessary'' prong 
of the section 112(n)(1)(A) inquiry to require EPA to examine whether 
there are any other available authorities under the CAA that, if 
implemented, would effectively address the remaining Hg emissions from 
coal-fired Utility Units.

[[Page 16005]]

    In December 2000, EPA did not consider CAA sections 110(a)(2)(D) 
\32\ and 111,\33\ which are viable alternative authorities under the 
CAA, that, if implemented, would effectively address the remaining 
utility Hg emissions. See Section VI below. Regulation under these 
authorities would effectively address the remaining utility Hg 
emissions for two primary reasons. First, as demonstrated in section VI 
below, the level of utility Hg emissions remaining after implementation 
of CAIR will not result in hazards to public health. Similarly, as 
shown in section VI below, the CAMR, which requires even greater Hg 
reductions than CAIR, will, once implemented, result in a level of 
utility Hg emissions that does not cause hazards to public health.
---------------------------------------------------------------------------

    \32\ In January 2004, the proposed section 111 rule was 
premised, in part, on the reductions in Hg emissions that EPA 
anticipated would be achieved through CAIR. In response to comments 
received on the CAMR, we conducted additional modeling that 
confirmed that CAIR alone, once implemented, would result in levels 
of utility Hg emissions that do not cause hazards to public health. 
(See Section VI below). Accordingly, we now believe that CAA section 
110()(2)(D) constitutes yet another viable authority under the CAA 
that, once implemented, will effectively address the remaining 
utility Hg emissions.
    \33\ In the Utility Study, we considered section 111 of the CAA, 
noting that ``new source performance standards currently provide the 
major regulatory authority for the control of air emissions from 
utilities.'' Utility Study 1-6. We recognized that we had issued 
NSPS for PM for Utility Units and we noted that such requirements 
would result indirectly in the control of certain HAP, including Hg. 
EPA did not, however, address in the Utility Study the question of 
whether HAP from utilities could be regulated under the authority of 
section 111 [Utility Study 1-5-6]. As explained in the proposed 
rule, we conducted a thorough re-evaluation of the provisions of the 
CAA and have concluded that section 111 provides authority to 
regulate HAP from new and existing Utility Units. See Section VII 
below (discussing legal authority under section 111).
---------------------------------------------------------------------------

    In addition, controlling Hg emissions through a cap-and-trade 
system--whether that control is through direct regulation under section 
111 or indirect regulation under section 110(a)(2)(D)--is an efficient 
means of regulating Utility Units. See CAMR final rule (signed on March 
15, 2005) (discussing basis and purpose of the regulations). As an 
initial matter, a cap-and-trade system, as opposed to the control 
regime imposed pursuant to section 112(d), provides Utility Units the 
flexibility to pursue a least-cost compliance option to achieve the 
required emissions reductions.
    Sources have the choice of complying with the reductions in a 
variety of ways, such as fuel switching, installing different pollution 
control technologies, installing new or emerging control technologies 
and/or buying allowances to emit from another source that has 
controlled its emissions to a level below what the regulation requires. 
This compliance flexibility allows Utility Units to respond to changing 
electricity generation demands, economic market conditions or 
unanticipated weather situations (e.g., extremely hot or cold periods) 
without jeopardizing their compliance status, or the stability of the 
overall cap. In addition, the certainty provided by the emissions cap 
and the timeline for declining emissions provide important information 
for industry to make strategic, long-range business decisions.
    Moreover, under a cap-and-trade approach, most of the reductions 
are projected to result from larger units installing controls and 
selling excess allowances, due to economies of scale realized on the 
larger units versus the smaller units. Indeed, EPA's modeling of 
trading programs demonstrates that large coal-fired Utility Units, 
which tend to have higher levels of Hg emissions, will achieve the most 
cost-effective emission reductions. These units are more likely to 
over-control their emissions and sell allowances, than to not control 
and purchase allowances. This model prediction is consistent with 
principles of capital investment in the utility industry. Under a 
trading system where the firm's access to capital is limited, where the 
up-front capital costs of control equipment are significant, and where 
emission-removal effectiveness (measured in percentage of removal) is 
unrelated to plant size, from an economics standpoint, the utility 
company is more likely to allocate pollution-prevention capital to its 
larger facilities than to the smaller plants (since more allowances 
will be earned from the larger facilities). Economies of scale of 
pollution control investment will also favor investment at the larger 
plants. Further, insofar as large coal-fired Utility Units tend to be 
newer and/or better maintained than medium-sized and small facilities, 
it can be expected that companies will favor investments in plants with 
a longer expected lifetime. These modeled predictions are consistent 
with the pattern of behavior that EPA has observed over the past decade 
through implementation of the SO2 emissions trading program 
under Title IV of the CAA. Thus, under a cap-and-trade program, Hg 
reductions result from units that are most cost effective to control, 
which enables those units that are not considered to have cost 
effective control alternatives to use other mechanisms for compliance, 
such as buying allowances. By contrast, regulating pursuant to a 
control regime like section 112(d) does not result in the cost 
efficiencies that are attendant a cap-and-trade program. For example, 
under section 112(d), each facility must meet a specific level of 
emission control, which can result in increased compliance costs, 
particularly for the smaller Utility Units given economies of scale.
    Finally, trading provides greater incentives for the development 
and adoption of new technologies, which could lead to a greater level 
of emissions control. See generally 69 FR 4686-87. An additional 
benefit of the cap-and-trade programs under sections 110(a)(2)(D) and 
111 is that they dovetail well with each other. In particular, the 
coordinated regulation of SO2, NOX, and Hg 
through CAIR and CAMR improves the cost effective manner of regulation 
because the reductions are being achieved simultaneously using in some 
cases the same technology to control more than one pollutant. In 
addition, the cap-and-trade programs under sections 110(a)(2)(D) 
complement other cap-and-trade programs that directly affect Utility 
Units, such as the NOX SIP-call final rule and the 
regulations implementing Title IV, which only further enhances the 
efficiencies of emission control from such units.
    In light of CAA sections 110(a)(2)(D) and 111, we believe that we 
should not have concluded in December 2000 that it ``is necessary'' to 
regulate Utility Units under section 112 and therefore our 
``necessary'' finding was in error. Moreover, even setting aside the 
error that we made in December 2000, we now recognize the availability 
of these other statutory provisions and we further conclude today that 
it is not necessary to regulate coal-fired Utility Units under section 
112 on the basis of the remaining Hg emissions. CAA section 
110(a)(2)(D), as implemented through CAIR, and independently section 
111, as implemented through CAMR, will effectively address the Hg 
emissions remaining from coal-fired Utility Units ``after imposition of 
the requirements of th[e] Act.''
    In sections V and VII below, we address sections 110(a)(2)(D) and 
111 and provide a thorough discussion of the legal authority under each 
provision. We also explain in Section VI that after implementation of 
CAIR, and independently, CAMR, we do not anticipate hazards to public 
health resulting from Hg emissions from coal-fired Utility Units.

[[Page 16006]]

2. It Is Not Appropriate and Necessary to Regulate Coal-Fired Units on 
the Basis of Non-Hg Emissions
    In the study required by section 112(n)(1)(A), and detailed in the 
Utility Study, EPA identified 67 HAP as potentially being emitted by 
Utility Units. (Utility Study, ES-4). Based on a screening assessment 
designed to prioritize HAP for further evaluation, EPA identified 14 
HAP as a priority for further evaluation. (Id.). Of the 14 HAP 
identified for further evaluation, 12 HAP (arsenic, beryllium, cadmium, 
chromium, manganese, nickel, hydrogen chloride, hydrogen fluoride, 
acrolein, dioxins, formaldehyde and radionuclides) were identified for 
further study based on potential for inhalation exposure and risks. 
(Utility Study, ES-6). Four of those 12 HAP (arsenic, cadmium, dioxins 
and radionuclides) plus Hg and lead were considered priority for 
multipathway exposure. (Id.). Of those six HAP, four (arsenic, Hg, 
dioxins and radionuclides) were identified as the highest priority to 
assess for multipathway exposure and risks. (Utility Study, ES-6, 7). 
The other 53 HAP were not evaluated beyond the screening assessment. 
(Utility Study, ES-7).
    In evaluating the potential for inhalation exposure and risks for 
the 12 HAP identified through the screening assessment as priority for 
that purpose, EPA estimated the high-end inhalation cancer risk for 
each HAP identified as a carcinogen and the high-end inhalation 
noncancer risks for the remaining HAP for both coal- and oil-fired 
Utility Units in 2010. (Utility Study, 6-16, tables 6-8 and 6-9). That 
evaluation indicated that there was no maximum individual risk (MIR) 
for cancer greater than 1 x 10\-6\ for beryllium, cadmium, dioxin and 
nickel emissions from coal-fired Utility Units and for beryllium, 
cadmium and dioxin emissions from oil-fired Utility Units. (Id.) With 
regard to dioxins, the Utility Study specifically concluded that the 
quantitative exposure and risk results did not conclusively demonstrate 
the existence of health risks of concern associated with inhalation 
exposures to utility emissions on a national scale or from any actual 
individual utility. (Utility Study, 11-5). The Utility Study thus 
indicates that inhalation of beryllium, cadmium and dioxin emissions 
from coal and oil-fired Utility Units and emissions of nickel from oil-
fired Utility Units are not of significant concern from a public health 
standpoint because such exposure does not present a maximum individual 
risk (MIR) for cancer greater than 1 x 10\-6\. With regard to lead 
emissions, EPA found that emission quantities and inhalation risks were 
relatively low and, therefore, decided not to conduct future 
evaluations of multipathway exposures to lead resulting from Utility 
Unit emissions. (Utility Study, ES-24). For arsenic, EPA concluded that 
there were several uncertainties associated with both the cancer risk 
estimates and the health effects data such that further analyses were 
needed to characterize the inhalation risks posed by arsenic emissions 
from Utility Units. (Utility Study, ES-21). The inhalation exposure 
assessment did not identify any exceedances of the health benchmarks 
(e.g., RfCs) for hydrogen chloride or hydrogen fluoride, thus 
indicating that Utility Unit emissions of those HAP did not pose a 
significant public health concern. (Utility Study chapters 6 and 9.)
    a. It Is Not Appropriate to Regulate Coal-fired Units on the Basis 
of Non-mercury HAP Emissions. The EPA erred in the December 2000 
Regulatory Determination to the extent that its ``appropriate'' finding 
for coal-fired Utility Units was based, in any way, on hazards to 
public health or the environment arising from emissions of non-mercury 
HAP from coal-fired Utility Units. Based on the information before it 
at the time, EPA could not have reasonably concluded that coal-fired 
Utility Unit non-mercury HAP emissions presented a hazard to public 
health. In addition, as stated above, EPA should not have considered 
environmental effects in the December 2000 Regulatory Determination's 
consideration of whether it was appropriate to regulate HAP emissions 
from coal-fired Utility Units under section 112.
    (i) Non-Mercury Metallic HAP. In the December 2000 Regulatory 
Determination, EPA indicated that there were a few metallic HAP (e.g., 
chromium and cadmium) which were of potential concern for carcinogenic 
effects, but stated that ``the results of the risk assessment 
(performed in conjunction with the Utility Study) indicate that cancer 
risks are not high''. (See 65 FR 79825, 79827.) The EPA acknowledged, 
however, that the cancer risks were not low enough to eliminate those 
metals as a potential concern for public health (Id.). This latter 
statement, at least as it pertains to cadmium, is at odds with the 
results of the risk assessment set forth in the Utility Study and 
discussed above. In the Utility Study, EPA determined that there was no 
maximum individual risk (MIR) for cancer greater than 1 x 10\-6\ due to 
inhalation of cadmium emissions from Utility Units. In the Proposed 
Rule, EPA stated that although it recognized the existence of 
uncertainties with regard to the data and information obtained prior to 
the December 2000 Regulatory Determination regarding potential hazards 
to public health resulting from Utility Unit emissions of non-mercury 
metallic HAP, the Agency believed that the uncertainties associated 
with those emissions were so great that it was not appropriate to 
regulate them at that time because they do not pose a hazard to public 
health that warrants regulation. (69 FR 4652, 4688, January 30, 2004). 
The EPA continues to believe that had it properly accounted for the 
uncertainties regarding the data and information on potential hazards 
to public health resulting from Utility Unit emissions of non-mercury 
metallic HAP in making the December 2000 appropriate finding it would 
have concluded that it was not appropriate to regulate such emissions 
because they do not cause a hazard to public health. The EPA has not 
discovered any new information on hazards to public health arising from 
such emissions that invalidates this conclusion, either through its own 
efforts or in response to the Proposed Rule.
    (ii) Dioxins. In the December 2000 Regulatory Determination, EPA 
also identified dioxins as being of potential concern and indicated 
that they may be evaluated further during the regulatory development 
process. (See 65 FR 79825, 79827.) The EPA did not, however, indicate 
that those concerns rose to a level that warranted regulation of 
dioxins. Thus, EPA did not conclude, and could not have concluded, 
based on the record before it at the time of the December 2000 
Regulatory Determination that it was appropriate to regulate coal-fired 
Utility Unit HAP emissions under section 112 of the CAA on the basis of 
dioxin emissions. In the Proposed Rule EPA stated that while it 
intended to continue to study dioxins in the future, the Utility Study 
and the information EPA had obtained since finalizing the Utility Study 
revealed no public health hazards reasonably anticipated to occur as a 
result of emissions of dioxins by Utility Units. (See 69 FR 4652, 
4688). As is the case with non-mercury metallic HAP, EPA has neither 
discovered information on hazards to public health arising from Utility 
Unit emissions of dioxins based on its own efforts, nor received such 
information in response to the Proposed Rule. The EPA therefore 
concludes that its appropriate finding in December 2000 lacked 
foundation because it could not have reasonably concluded that the

[[Page 16007]]

level of remaining utility dioxin emissions results in hazards to 
public health.
    (iii) Acid Gases. In the December 2000 Regulatory Determination, 
EPA identified emissions of hydrogen chloride and hydrogen fluoride as 
being of potential concern and indicated that such emissions may be 
evaluated further during the regulatory development process. (See 65 FR 
79825, 79827.) The EPA did not, however, indicate that it believed that 
it was appropriate to regulate such emissions, under section 112 or 
otherwise. As indicated in the Proposed Rule, EPA did in fact further 
evaluate Utility Unit emissions of hydrogen chloride and hydrogen 
fluoride. (See 69 FR 4652, 4688, fn. 10; ``Modeling results for 
hydrogen chloride, hydrogen fluoride and chlorine emissions from coal-
fired utility boilers'', December 12, 2003, OAR-2002-0056-0015). That 
modeling indicates that individuals are not exposed to acid gas 
emissions from Utility Units at concentrations which pose hazards to 
public health. EPA has neither discovered information on hazards to 
public health arising from Utility Unit emissions of acid gases based 
on its own efforts, nor received such information in response to the 
Proposed Rule. EPA therefore concludes that its appropriate finding in 
December 2000 lacked foundation because the level of remaining utility 
acid gas emissions does not result in hazards to public health.
    For the reasons stated above, EPA finds that it could not 
reasonably have concluded that it was appropriate to regulate coal-
fired Utility Units under section 112 due to emissions of non-mercury 
HAP based on the record before it at the time of the December 2000 
Regulatory Determination. The EPA further finds that it has not itself 
discovered any information which would support the conclusion that it 
is appropriate to regulate non-mercury HAP emissions by coal-fired 
Utility Units under section 112 subsequent to the December 2000 
Regulatory Determination, nor has it received any such information in 
response to the January 2004 Proposed Rule, the March 2004 Supplemental 
Notice or the December 2004 Notice of Data Availability. Further, EPA 
has concluded that it did not, and should not, rely on potential 
environmental effects alone in determining whether it was appropriate 
to regulate coal-fired Utility Units under section 112. The EPA, 
therefore, finds that, based on the record before it at the time, it 
was in error in determining that it was appropriate to regulate coal-
fired Utility Unit HAP emissions under section 112 to the extent that 
the determination was based in any way on the hazards to public health 
of non-mercury HAP emissions or on environmental effects resulting from 
such emissions.
    b. It Is Not Necessary to Regulate Coal-fired Units on the Basis of 
Non-Mercury HAP Emissions. In determining whether it is appropriate and 
necessary to regulate Utility Unit HAP emissions under section 112, the 
threshold question is whether it is appropriate to regulate such 
emissions at all. Where, as here, EPA cannot reasonably conclude that 
it is appropriate to regulate such emissions, the Agency does not need 
to resolve the question of whether it is necessary to regulate such 
emissions under section 112, or elsewhere. In any event, even if EPA 
could have reasonably concluded that it was appropriate to regulate 
non-mercury HAP emissions from coal-fired Utility Units, it would not 
have been reasonable for the Agency to find that it was necessary to 
regulate such emissions under section 112 since, as discussed above, it 
should have realized that there was an available alternative mechanism, 
such as section 111, for regulating such emissions had it been 
appropriate to do so. See also Section VII below.

B. Revision of the December 2000 Appropriate and Necessary Finding for 
Oil-fired Units

1. It Is Not Appropriate and Necessary To Regulate Oil-Fired Units on 
the Basis of Nickel Emission
    a. It Is Not Appropriate to Regulate Oil-fired Units on the Basis 
of Nickel Emissions. In finding that the regulation of HAP emissions 
from oil-fired Utility Units was appropriate and necessary in its 
December 2000 Regulatory Determination, EPA did not clearly identify 
the basis for this finding beyond stating that there remained 
uncertainties regarding the extent of the public health impact from HAP 
emissions from oil-fired units and that those uncertainties led the 
Administrator to find that regulation of HAP emission from such units 
under section 112 is appropriate and necessary. (See 65 FR 79825, 
79830). Table 1 in the 2000 determination does, however, indicate that 
nickel is the metallic HAP emitted in the largest quantities by oil-
fired Utility Units and that some nickel compounds are carcinogenic. 
(See 65 FR 79825, 79828). It therefore appears that EPA's finding was 
based at least in part on its concerns regarding perceived hazards to 
public health arising from inhalation exposure to nickel emissions from 
oil-fired Utility Units. This is consistent with the Utility Study 
which, based on very conservative assumptions regarding the 
carcinogenicity of the nickel emitted by such units, identifies nickel 
as the HAP emitted by oil-fired Utility Units which poses the highest 
cancer maximum individual risk. (Utility Study, Table 6-3, p. 6-8). The 
Utility Study identifies 11 oil-fired utility plants as having 
emissions causing maximum individual risk of cancer greater than 
10-6 based on nickel emissions (Id.)
    In the Proposed Rule, EPA stated that it continued to believe that 
the record supports a distinction between the treatment of nickel 
emissions from oil-fired Utility Units and other non-nickel HAP 
emissions from such units. EPA proposed to conclude that it was not 
appropriate to regulate the non-Ni HAP. EPA also proposed to treat 
nickel from oil-fired units differently based on the amount of nickel 
emitted annually and the scope of adverse health effects (See 69 FR 
4652, 4688). Based on its analysis of new information obtained in 
response to the Proposed Rule, EPA has determined that the distinction 
between nickel and the remaining HAP from oil-fired units cannot be 
supported. EPA finds that it is not appropriate to regulate nickel 
emissions from oil-fired Utility Units and that it is, therefore, not 
appropriate to regulate oil-fired Utility Units. This finding is based 
on the following: (1) The significant reductions in the total 
nationwide inventory of oil-fired Utility Units; and (2) the changing 
fuel mixtures being used at the remaining units.
    Nickel emissions from oil-fired Utility Units have been 
substantially reduced since the 1998 Utility Report to Congress through 
a combination of unit closures and fuel switching. The 11 oil-fired 
plants identified in the Utility Study as having emissions causing a 
maximum individual risk of cancer greater than 10-6 based on 
nickel emissions were comprised of 42 individual units. Of those 42 
units, 12 units have permanently ceased operation or are out of 
service. (OAR-2002-0056-2046 at pp. 12-13; OAR-2002-0056-5998). In 
addition, 6 of the original 42 units have reported to the U.S. 
Department of Energy (DOE) that their fuel mix now includes natural 
gas. Earlier reports did not show these units as using natural gas as a 
fuel. (OAR-2002-0056-5998). The use of natural gas as a part of their 
fuel mix would decrease the nickel emissions from these 6 units. 
Similarly, another 5 units report using a mix of natural gas and 
distillate oil (rather than residual oil) in

[[Page 16008]]

2003. (OAR-2002-0056-5998). Since distillate oil contains less nickel 
than the residual oil previously burned by these units, it is 
reasonable to assume that these units currently emit less nickel than 
was previously the case. Another 2 units now fire a residual oil/
natural gas mixture and have limited their residual oil use through 
permit restrictions to no greater than 10 percent of the fuel 
consumption between April 1 and November 15, with natural gas being 
used for at least 90 percent of total fuel consumption. (OAR-2002-0056-
2046 at p. 13). Finally, five units have effectively eliminated their 
nickel emissions since the Utility Study by switching to burning 
natural gas exclusively. (OAR-2002-0056-2046 at pp. 12-13; OAR-2002-
0056-5998). Taken as a whole, these changes mean that 30 of the 
original 42 units identified in the Utility Study have taken steps to 
reduce or actually eliminate their nickel emissions. Of the original 11 
plants identified in the Utility Study, only 2, both in Hawaii, have 
units for which actions that will result in reduced nickel emissions do 
not appear to have been taken. (OAR-2002-0056-6871) In addition to the 
closure of the 12 units identified as being of potential concern in the 
Utility Study, there has been a steady decrease in the number of oil-
fired Utility Units generally over the past decade and this trend is 
likely to continue. In fact, the latest DOE/EIA projections (OAR-2002-
0056-5999) estimate no new utility oil-fired generating capacity and 
decreasing existing oil-fired generating capacity through 2025, with an 
additional 29.2 gigawatts of combined oil- and natural gas-fired 
existing capacity being retired by 2025.
    Based on the foregoing, EPA concludes that it is not appropriate to 
regulate oil-fired Utility Units under section 112 because we do not 
anticipate that the remaining level of utility nickel emissions will 
result in hazards to public health.
    b. It Is Not Necessary to Regulate Oil-fired Units on the Basis of 
Nickel Emissions. Because EPA could not have reasonably found that it 
was appropriate to regulate nickel emissions from oil-fired Utility 
Units based on the record before it at the time of the December 2000 
Regulatory Determination, it should not have made a finding that it was 
necessary to regulate such emissions. Information obtained in the 
course of the rulemaking since the Proposed Rule has confirmed this 
conclusion. In any event, even if EPA could have reasonably concluded 
that it was appropriate to regulate nickel emissions from oil-fired 
Utility Units, it would not have been reasonable for the Agency to find 
that it was necessary to regulate such emissions under section 112 
since, as discussed above, it should have realized that there was an 
available alternative mechanism, section 111, for regulating such 
emissions had it been appropriate to do so. See also Section VII below.
2. It Is Not Appropriate and Necessary To Regulate Oil-Fired Units on 
the Basis of Non-Nickel HAP Emissions
    a. It Is Not Appropriate to Regulate Oil-fired Units on the Basis 
of Non-nickel HAP Emissions. As is the case with emissions of nickel, 
the record before EPA at the time of the December 2000 Regulatory 
Determination does not reasonably support a finding that it is 
appropriate to regulate emissions of any other HAP from oil-fired 
Utility Units. In the December 2000 Regulatory Determination, EPA 
stated that there remain uncertainties regarding the extent of the 
public health impact from HAP emissions from oil-fired Utility Units 
and, on that basis, found that it was appropriate and necessary to 
regulate oil-fired Utility Units under section 112. (See 65 FR 79825, 
79830.) The EPA neither identified the HAP concerning which there were 
uncertainties nor identified what those uncertainties were. EPA has 
neither discovered information on hazards to public health arising from 
the remaining non-nickel emissions of oil-fired Utility Units, nor 
received such information in response to the Proposed Rule. EPA 
therefore concludes that its appropriate finding in December 2000 
lacked foundation because, given the level of remaining non-nickel HAP 
emissions from Utility Units, the Agency did not and does not have any 
information on the hazards to public health reasonably anticipated to 
occur. Indeed, the uncertainties that exist with regard to the data and 
information on these emissions are so great that the Agency has not 
identified any hazards to public health.
    b. It Is Not Necessary to Regulate Oil-fired Units on the Basis of 
Non-nickel HAP Emissions. Because EPA finds that it is not appropriate 
to regulate oil-fired Utility Units on the basis of non-nickel HAP 
emissions, it also finds that it is not necessary to regulate oil-fired 
Utility Units on the basis of such emissions. In any event, even if EPA 
could have reasonably concluded that it was appropriate to regulate 
non-nickel HAP emissions from oil-fired Utility Units, it would not 
have been reasonable for the Agency to find that it was necessary to 
regulate such emissions under section 112 since, as discussed above, it 
should have realized that there was an available alternative mechanism, 
section 111, for regulating such emissions had it been appropriate to 
do so. See also Section VII below.

V. Statutory and Regulatory Overview of CAA Section 110(a)(2)(D) and 
Summary of EPA's Clean Air Interstate Rule, Which Implements Section 
110(a)(2)(D)

A. The Clean Air Interstate Rule and Clean Air Act Section 110(a)(2)(D)

1. Background for Promulgation of the Clean Air Interstate Rule
    The Administrator signed the notice of final rulemaking for the 
Clean Air Interstate Rule (CAIR) on March 10, 2005. The background for 
CAIR is fully described in the preambles to the final rule, the notice 
of proposed rulemaking, 69 FR 4565 (January 30, 2004) and the notice of 
supplemental rulemaking, 69 FR 12398 (March 16, 2004), and is briefly 
summarized below.
    a. PM 2.5 NAAQS, 8-hour Ozone NAAQS, and the Nonattainment 
Problems. By notice dated July 18, 1997, we revised the NAAQS for 
particulate matter to add new standards for fine particles, using as 
the indicator particles with aerodynamic diameters smaller than a 
nominal 2.5 micrometers, termed PM 2.5. 62 FR 38652. We established 
health- and welfare-based (primary and secondary) annual and 24-hour 
standards for PM 2.5. The annual standard is 15 micrograms per cubic 
meter, based on the 3-year average of annual mean PM 2.5 
concentrations. The 24-hour standard is a level of 65 micrograms per 
cubic meter, based on the 3-year average of the annual 98th percentile 
of 24-hour concentrations.
    By a separate notice dated July 18, 1997, EPA also promulgated a 
revised primary NAAQS for ozone (and an identical secondary ozone 
NAAQS). This revised NAAQS, termed the 8-hour NAAQS, specified that the 
3-year average of the fourth highest daily maximum 8-hour average ozone 
concentration could not exceed 0.08 ppm. (See 40 CFR 50.10) In general, 
the revised 8-hour standard is more protective of public health and the 
environment and more stringent than the pre-existing 1-hour ozone 
standard. Following promulgation of the 8-hour ozone and the PM 2.5 
NAAQS, EPA anticipated that many areas of the country, particularly in 
the eastern half of the country, would have air quality violating one 
or both of those NAAQS.\34\
---------------------------------------------------------------------------

    \34\ Environmental Protection Agency, 1996. Review of the 
National Ambient Air Quality Standards for Particulate Matter: 
Policy Assessment of Scientific and Technical Information. OAQPS 
Staff Paper. Research Triangle Park, NC: Office of Air Quality 
Planning and Standards; Report No. EPA-45/R-96-013.

---------------------------------------------------------------------------

[[Page 16009]]

    b. SO2 and NOX as Precursors for PM 2.5 and 
8-hour Ozone. Fine particles are emitted directly from emissions 
sources and also can be formed in the atmosphere through the reaction 
of gaseous precursors. Sulfur dioxide and nitrogen oxides are among the 
primary precursors to the ``secondary'' formation of PM 2.5.
    Eight-hour ozone is exclusively a secondary pollutant. Ozone is 
formed by natural processes at high altitudes, in the stratosphere, 
where it serves as an effective shield against penetration of harmful 
solar UV-B radiation to the ground. The ozone present at ground level 
as a principal component of photochemical smog is formed in sunlit 
conditions through atmospheric reactions of two main classes of 
precursor compounds: VOCs and NOX (mainly NO and 
NO2). Nitrogen oxides are emitted by motor vehicles, power 
plants, and other combustion sources, with lesser amounts from natural 
processes including lightning and soils.
    Both PM 2.5 and 8-hour ozone are regional phenomena; that is each 
is caused by emissions over a broad geographic area. As a result, 
attainment of the PM 2.5 NAAQS requires reductions in SO2 
and NOX over a widespread area, and attainment of the 8-hour 
ozone NAAQS requires reductions in NOX over a widespread 
area. In the CAIR proposal, EPA described the photochemistry and need 
for regionwide reductions of precursors of both pollutants in detail. 
See 69 FR at 4572.
    After promulgation of the PM 2.5 NAAQS, EPA was generally aware of 
the role of SO2 and NOX emissions in the PM 2.5 
nonattainment problem, and, therefore, of the need for widespread 
reductions. Similarly, after promulgation of the 8-hour ozone NAAQS, 
EPA was aware of widespread nonattainment, due to nonattainment of the 
pre-existing, one-hour ozone standard, and therefore of the need for 
widespread NOX reductions.
    c. Coal-fired Utility Units Emit A Large Portion of SO2 
and NOX Emissions. Utility Units emit a large portion of 
both the SO2 and NOX inventory. Congress clearly 
recognized that the utility industry emits a large portion of the 
nation's inventory of SO2 and NOX emissions when 
Congress enacted the acid deposition provisions in the 1990 Clean Air 
Act Amendments. EPA noted in the CAIR proposal that Utility Units--

are the most significant source of SO2 emissions and a 
very substantial source of NOX in the * * * region 
[proposed to be affected by CAIR]. For example, EGUs [Utility Units] 
emissions are projected to represent approximately one-quarter (23 
percent) of the total NOX emissions in 2010 and over two-
thirds (67 percent) of the total emissions in 2010 in the 28-State 
plus DC region that [EPA proposed for] being controlled for both 
SO2 and NOX after application of current CAA 
controls.

(See 69 FR 4565, 4609-10 January 30, 2004.)
    Beginning in the mid-1990s, EPA has considered regional and 
national strategies to reduce interstate transport of SO2 
and NOX. EPA described these efforts in the CAIR notice of 
final rulemaking.
3. Legal Authority
    As noted above, in 1997, EPA revised the NAAQS for PM to add new 
annual average and 24-hour standards for fine particles, using PM 2.5 
as the indicator (62 FR 38652). At the same time, EPA issued its final 
action to revise the NAAQS for ozone to establish new 8-hour standards 
(62 FR 38856.) Following promulgation of new NAAQS, the CAA requires 
all areas, regardless of their designation as attainment, 
nonattainment, or unclassifiable, to submit SIPs containing provisions 
specified under section 110(a)(2). SIPs for nonattainment areas are 
generally required to include additional emissions controls providing 
for attainment of the NAAQS. In addition, under the authority of 
section 110(a)(2)(D) and other provisions of section 110, EPA 
promulgated the NOX SIP-Call in 1998. In that rulemaking, 
EPA determined that 22 States and the District of Columbia in the 
eastern half of the country significantly contribute to 1-hour and 8-
hour ozone nonattainment problems in downwind States.\35\ This rule 
required those jurisdictions to revise their SIPs to include 
NOX control measures to mitigate the significant ozone 
transport. The EPA determined the emissions reductions requirements by 
projecting NOX emissions to 2007 for all source categories 
and then reducing those emissions through controls that EPA determined 
to be highly cost-effective. The affected States were required to 
submit SIPs providing the resulting amounts of emissions reductions.
---------------------------------------------------------------------------

    \35\ See ``Finding of Significant Contribution and Rulemaking 
for Certain States in the Ozone Transport Assessment Group Region 
for Purposes of Reducing Regional Transport of Ozone; Final Rule,'' 
63 FR 57356 (October 27, 1998). The EPA also published two Technical 
Amendments revising the NOX SIP Call emission reduction 
requirements. (64 FR 26298; May 14, 1999 and 65 FR 11222; March 2, 
2000).
---------------------------------------------------------------------------

    Under the NOX SIP-Call, States had the flexibility to 
determine the mix of controls to meet their emissions reductions 
requirements. However, the rule provided that if the SIP controls 
Utility Units, then the SIP must establish a budget, or cap, for 
Utility Units. The EPA recommended that each State authorize a trading 
program for NOX emissions from Utility Units. We developed a 
model cap and trade program that States could voluntarily choose to 
adopt, and all did so.
4. CAIR
    In CAIR, EPA established SIP requirements for the affected upwind 
States under the authority of CAA section 110(a)(2)(D) and other 
provisions of section 110.\36\ Based on air quality modeling analyses 
and cost analyses, EPA concluded that SO2 and NOX 
emissions in certain States in the eastern part of the country, through 
the phenomenon of air pollution transport, contribute significantly to 
downwind nonattainment of the PM 2.5 and 8-hour ozone NAAQS. In CAIR, 
EPA required SIP revisions in 28 States and the District of Columbia to 
reduce SO2 and/or NOX emissions, which are 
important precursors of PM 2.5 (NOX and SO2) and 
ozone (NOX). The affected States and the District of 
Columbia are required to adopt and submit the required SIP revision 
with the necessary control measures by 18 months from date of signature 
of CAIR.
    The 23 States along with the District of Columbia that must reduce 
annual NOX emissions for the purposes of the PM 2.5 NAAQS 
are: Alabama, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, 
Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, New 
York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, 
Texas, Virginia, West Virginia, and Wisconsin.
---------------------------------------------------------------------------

    \36\ See ``Rule to Reduce Interstate Transport of Fine 
Particulate Matter and Ozone (Interstate Air Quality Rule); Proposed 
Rule,'' 69 FR 4566 (January 30, 2004); ``Supplemental Proposal for 
the Rule to Reduce Interstate Transport of Fine Particulate Matter 
and Ozone (Clean Air Interstate Rule); Proposed Rule,'' 69 FR 32684 
(June 10, 2004); and the final rule ``Rule to Reduce Interstate 
Transport of Fine Particulate Matter and Ozone (Clean Air Interstate 
Rule),'' which was recently issued.
---------------------------------------------------------------------------

    The 25 States along with the District of Columbia that must reduce 
NOX emissions for the purposes of the 8-hour ozone NAAQS 
are: Alabama, Arkansas, Connecticut, Delaware, Florida, Illinois, 
Indiana, Iowa, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, 
Mississippi, Missouri, New Jersey, New York, North Carolina, Ohio, 
Pennsylvania, South Carolina,

[[Page 16010]]

Tennessee, Virginia, West Virginia, and Wisconsin.
    The emissions reductions requirements are based on controls that 
EPA determined to be highly cost-effective for Utility Units. However, 
States have the flexibility to choose the measures to adopt to achieve 
the specified emissions reductions. If the State chooses to control 
Utility Units, then it must establish a budget--that is, an emissions 
cap--for those sources. CAIR defines the Utility Units budgets for each 
affected State. Due to feasibility constraints, EPA is requiring that 
emissions reductions be implemented in two phases, with the first phase 
in 2009 (for NOX) and 2010 (for SO2), and the 
second phase in 2015.
    As noted above, under the CAIR, each State may independently 
determine which emissions sources to subject to controls, and which 
control measures to adopt. The EPA's analysis indicates that emissions 
reductions from Utility Units are highly cost-effective, and in the 
CAIR, EPA encouraged States to adopt controls for Utility Units. States 
that do so must place an enforceable limit, or cap, on Utility Unit's 
emissions. The EPA calculated the amount of each State's Utility Unit 
emissions cap, or budget, based on reductions that EPA determined are 
highly cost-effective. States may allow their Utility Units to 
participate in an EPA-administered cap-and-trade program as a way to 
reduce the cost of compliance, and to provide compliance flexibility. 
The EPA will administer these programs, which will be governed by rules 
provided by EPA that States may adopt or incorporate by reference.
    EPA estimated that the CAIR would reduce annual SO2 
emissions by 3.6 million tons by 2010 and by 4.0 million tons by 2015; 
and would reduce annual NOX emissions by 1.3 million tons by 
2010 and by 1.5 million tons by 2015. If all the affected States choose 
to achieve these reductions through Utility Unit controls, then Utility 
Unit emissions in the affected States would be capped at 3.7 million 
tons in 2010 and 2.6 million tons in 2015; and Utility Unit annual 
NOX emissions would be capped at 1.5 million tons in 2010 
and 1.3 million tons in 2015. The EPA estimated that the required 
SO2 and NOX emissions reductions would, by 
themselves, bring into attainment 52 of the 80 counties that are 
otherwise expected to be in nonattainment for PM 2.5 in 2010, and 57 of 
the 75 counties that are otherwise expected to be in nonattainment for 
PM 2.5 in 2015. The EPA further estimated that the required 
NOX emissions reductions would, by themselves, bring into 
attainment 3 of the 40 counties that are otherwise expected to be in 
nonattainment for 8-hour ozone in 2010, and 6 of the 22 counties that 
are expected to be in nonattainment for 8-hour ozone in 2015. In 
addition, the CAIR would improve PM 2.5 and 8-hour ozone air quality in 
the areas that would remain nonattainment for those two NAAQS after 
implementation of CAIR. Because of the CAIR, the States with those 
remaining nonattainment areas will find it less burdensome and less 
expensive to reach attainment by adopting additional local controls. 
The CAIR would also reduce PM 2.5 and 8-hour ozone levels in attainment 
areas.

C. Utility Mercury Emission Reductions Expected as Co-Benefits From 
CAIR

    The final CAIR requires annual SO2 and NOX 
reductions in 23 States and the District of Columbia, and also requires 
ozone season NOX reductions in 25 States and the District of 
Columbia. Many of the CAIR States are affected by both the annual 
SO2 and NOX reduction requirements and the ozone 
season NOX requirements. CAIR was designed to achieve 
significant emissions reductions in a highly cost-effective manner to 
reduce the transport of fine particles that have been found to 
contribute to nonattainment. EPA analysis has found that the most 
efficient method to achieve the emissions reduction targets is through 
a cap-and-trade system on the power sector that States have the option 
of adopting. In fact, States may choose not to participate in the 
optional cap-and-trade program and may choose to obtain equivalent 
emissions reductions from other sectors. However, EPA believes that a 
region-wide cap-and-trade system for the power sector is the best 
approach for reducing emissions. The power sector accounted for 67 
percent of nationwide SO2 emissions and 22 percent of 
nationwide NOX emissions in 2002.
    EPA expects that States will choose to implement the final CAIR 
program in much the same way they chose to implement their requirements 
under the NOX SIP Call. As noted above, under the 
NOX SIP Call, EPA gave States ozone season NOX 
reduction requirements and the option of participating in a cap-and-
trade program. In the final rulemaking, EPA analysis indicated that the 
most efficient method to achieve reductions targets would be through a 
cap-and-trade program. Each affected State, in its approved SIP, chose 
to control emissions from Utility Units and to participate in the cap-
and-trade program.
    Therefore, EPA anticipates that States will comply with CAIR by 
controlling Utility Unit SO2 and NOX emissions. 
Further, EPA anticipates that States will implement those reductions 
through the cap-and-trade approach, since the power sector represents 
the majority of national SO2 emissions and the majority of 
stationary NOX emissions, and represent highly cost-
effective SO2 and NOX sources to reduce. For 
further discussion of cost-effectiveness, see section IV of CAIR notice 
of final rulemaking. EPA modeled a region-wide cap and trade system on 
the power sector for the States covered by CAIR, and this modeling 
projected that most reductions in NOX and SO2 
would come through the installation of scrubbers, for SO2 
control, and selective catalytic reduction for NOX control 
(see Regulatory Impact Assessment for CAIR and CAMR in docket). 
Scrubbers and SCR are proven technologies for controlling 
SO2 and NOX emissions and sources installed them 
to comply with the Acid Rain trading program and the NOX SIP 
Call trading program. EPA's modeling also projected that the 
installation of these controls would achieve Hg emission reductions as 
a co-benefit.
    EPA projections of Hg co-benefits are based on 1999 Hg ICR emission 
test data and other more recent testing conducted by EPA, DOE, and 
industry participants. (For further discussion see Control of Emissions 
from Coal-Fired Electric Utility Boilers: An Update, EPA/Office of 
Research and Development, March 2005, in the docket). That emission 
testing has provided a better understanding of Hg emissions and their 
capture in pollution control devices. Mercury speciates into three 
basic forms, ionic, elemental, and particulate (particulate represents 
a small portion of total emissions). In general, ionic Hg compounds are 
more readily absorbed than elemental Hg and the presence of chlorine 
compounds (which tend to be higher for bituminous coals) results in 
increased ionic Hg. Overall the 1999 Hg ICR data revealed higher levels 
of Hg capture for bituminous coal-fired plants as compared to 
subbituminous and lignite coal-fired plants and a significant capture 
of ionic Hg in wet SO2 scrubbers. Additional Hg testing 
indicates that for bituminous coals SCR has the ability to convert 
elemental Hg to ionic Hg and thus allow easier capture in a wet 
scrubber. This understanding of Hg capture was incorporated into EPA 
modeling assumptions and is the basis for our projections of Hg co-
benefits from installation of scrubbers and SCR under CAIR.
    The final CAIR requires annual SO2 and NOX 
reductions in two phases, the

[[Page 16011]]

first phase in 2010 and the second phase in 2015. EPA modeling of CAIR 
projected that most reductions in NOX and SO2 
would come through the installation of scrubbers and SCR, and that the 
installation of these controls would also achieve Hg emission 
reductions as a co-benefit. Given the history of the Acid Rain and 
NOX SIP Call trading programs, and our experience with those 
programs, we anticipate that reductions in SO2 emissions 
will begin to occur before 2010 because of the ability to bank 
SO2 emission allowances, though to some degree this is 
limited by the time and resources needed to install control 
technologies. Companies have an incentive to achieve greater 
SO2 reductions than needed to meet the current Acid Rain cap 
because the excess allowances they generate can be ``banked'' and 
either later sold on the market or used to demonstrate compliance in 
2010 and beyond at the facility that generated the excess allowances. 
Based on the analysis of CAIR, EPA's modeling projects that Hg 
emissions would be 38.0 tons (12 tons of non-elemental Hg) in 2010, 
34.4 tons in 2015 (10 tons of non-elemental Hg), and 34.0 tons in 2020 
(9 tons of non-elemental Hg), about a 20 and 30 percent reduction (in 
2010 and 2015, respectively) from a 1999 baseline of 48 tons.\37\ For 
further discussion of EPA modeling results and projected emissions see 
Chapter 8 of the Regulatory Impact Assessment.\38\
---------------------------------------------------------------------------

    \37\ As discussed in the TSD, the emissions of reactive gaseous 
Hg and particle-bound Hg are most important for local and regional 
Hg deposition purposes, since they are substantially more likely to 
be deposited than elemental Hg. CAIR and CAMR will significantly 
reduce reactive gaseous Hg and particle bound Hg from 2001 levels. 
CAIR will reduce the levels from approximately 22 tons to 9 tons. 
CAMR will reduce this level further to between 7 and 9 tons, for a 
total reduction (with CAIR) of roughly 70 percent.
    \38\ In addition to CAIR, EPA recently promulgated another rule 
for Utility Units. Specifically, on March 15, 2005, the 
Administrator signed a final rulemaking called the Clean Air Mercury 
Rule (``CAMR'') pursuant to CAA section 111. This rule sets 
standards of performance for Hg emitted from both new and existing 
coal-fired Utility Units. Like CAIR, the rule establishes a cap-and-
trade mechanism by which Hg emissions from new and existing coal-
fired Utility Units are capped at specified, nation-wide levels. The 
first phase cap of 38 tons per year (``tpy'') becomes effective in 
2010 and the second phase cap of 15 tpy becomes effective in 2018. 
Facilities must demonstrate compliance with the standards of 
performance by holding one ``allowance'' for each ounce (oz) of Hg 
emitted in any given year. Allowances are readily transferrable 
among all regulated units. As explained in section VI below, the 
level of Hg emissions remaining after implementation of CAMR do not 
result in hazards to public health.
---------------------------------------------------------------------------

VI. Scientific and Technical Background and EPA'S Conclusions 
Concerning the Level of Utility Attributable Mercury Emissions After 
CAIR and CAMR

    In this section, we explain why we believe the level of utility 
attributable Hg emissions remaining after imposition of CAIR, and 
independently, CAMR, will not result in hazards to public health. The 
issue of whether utility Hg emissions remaining after CAIR, and 
independently CAMR, result in hazards to public health is directly 
related to our conclusion, stated above in Section IV.A, that we cannot 
find it appropriate and necessary to regulate coal-fired Utility Units 
under section 112 on the basis of Hg emissions. This section includes 
an overview of the scientific and technical information relevant to 
evaluating utility Hg emissions and the public health impacts 
associated with such emissions. Below, we provide general background 
concerning the health impacts of methylmercury; the predominant 
exposure pathway by which humans are affected by methylmercury, which 
is by ingestion of fish containing methylmercury; and EPA's methodology 
for determining the impacts of utility Hg emissions on the amount of 
methylmercury found in fish tissue. This section also includes a 
summary of our conclusions, including that utility Hg emissions 
remaining after implementation of CAIR, and independently CAMR, are not 
reasonably anticipated to result in hazards to public health.

A. Human Health Impacts of Methylmercury Exposure and Amounts of Hg 
Emissions

    Hg is a persistent, bioaccumulative toxic metal that is emitted 
from power plants in three forms: Elemental mercury (Hg\0\), oxidized 
mercury (Hg\++\) compounds, as well as particle-bound mercury. 
Methylmercury is formed by microbial action in the top layers of 
sediment and soils, after Hg has precipitated from the air and 
deposited into water bodies or land. Once formed, methylmercury is 
taken up by aquatic organisms and bioaccumulates up the aquatic food 
web. Larger predatory fish may have methylmercury concentrations many 
times that of the water body in which they live.
    While Hg is toxic to humans when it is inhaled or ingested, we 
focus on oral exposure of methylmercury in this rulemaking, as it is 
the route of primary interest for human exposures in the U.S. 
Methylmercury is a well-established human neurotoxicant. Methylmercury 
that is ingested by humans is readily absorbed from the 
gastrointestinal tract and can cause effects in several organ systems. 
The best studied effect of low level exposure is the ability of 
methylmercury to cause subtle, yet potentially important 
neurodevelopmental effects. Of particular concern is the effect of 
methylmercury on the developing fetal nervous system exposed in utero 
from maternal fish ingestion. Large prospective epidemiological studies 
have reported that prenatal methylmercury from environmental exposures 
has been associated with poor performance on neurobehavioral tests in 
children. These include tests that measure attention, visual-spatial 
ability, verbal memory, language skills, and fine motor function. These 
studies have been thoroughly reviewed, singly and as part of review 
groups, by many expert scientists, including a panel of the National 
Research Council (NRC) of the National Academy of Sciences (NAS).\39\ 
While important, the weight of evidence for cardiovascular effects is 
not as strong as it is for childhood neurological effects and the state 
of the science is still being evaluated. However, some recent 
epidemiological studies in men suggest that methylmercury is associated 
with a higher risk of acute myocardial infaraction, coronary heart 
disease and cardiovascular disease in some populations. Other recent 
studies have not observed this association. The findings to date and 
the plausible biological mechanisms warrant additional research in this 
area (Stern 2005; Chan and Egeland 2004). There is some recent evidence 
that methylmercury may result in genotoxic or immunotoxic effects. 
Overall, there is a relatively small body of evidence from human 
studies that suggests exposure to methylmercury can result in 
immunotoxic effects and the NRC concluded that evidence that human 
exposure caused genetic damage is inconclusive. There are insufficient 
human data to evaluate whether these effects are consistent with levels 
in the U.S. population. Because the developing fetus may be the most 
sensitive to the effects from methylmercury, women of

[[Page 16012]]

child-bearing age are regarded as the population of greatest interest 
when assessing methylmercury exposure.
---------------------------------------------------------------------------

    \39\ Studies investigating the relationship between 
methylmercury and cardiovascular effects have reached different 
conclusions. Some recent epidemiological studies of men suggest that 
methylmercury is associated with a higher risk of acute myocardial 
infarction, coronary heart disease and cardiovascular disease in 
some populations. Other research with less corroboration suggest 
that reproductive, renal, and hematological impacts may be of 
concern. There are insufficient human data to evalaute whether these 
effects are consistent with levels in the U.S. population. See RIA 
for CAMR chapter 2.
---------------------------------------------------------------------------

    The predominant pathway of Hg exposure to both humans and wildlife 
is consumption of fish. Critical elements in estimating methylmercury 
exposure and risk from fish consumption include the concentrations of 
methylmercury in the fish consumed, the quantity of fish consumed,\40\ 
and how frequently the fish is consumed. There is a great deal of 
variability among individuals in fish consumption rates. However, our 
analysis indicates that the typical U.S. consumer eating moderate 
amounts of a wide variety of low-mercury fish from restaurants and 
grocery stores is not expected to ingest harmful levels of 
methylmercury from fish. Those who regularly and frequently consume 
large amounts of fish, or fish with higher levels of methylmercury, are 
more exposed. The EPA and Food and Drug Administration jointly, as well 
as states, have issued fish consumption advisories to inform people of 
ways to reduce exposure to methylmercury from fish.
---------------------------------------------------------------------------

    \40\ A precise estimate of methylmercury exposure depends on 
quantity of fish consumed as a function of an individual's body 
weight.
---------------------------------------------------------------------------

    As part of its long term U.S. population surveillance, the U.S. 
Centers for Disease Control (CDC) assessed Hg concentrations in blood 
of over 3,600 women of child-bearing age under the National Health and 
Nutrition Examination Survey (NHANES). A recent analysis of these data 
reported that about 6 percent of these women of child-bearing age have 
levels of Hg in their blood that are at or above the U.S. EPA's RfD, 
described below. The CDC also surveyed the same group of women about 
their eating habits. An analysis of 1500 of these women showed that Hg 
blood levels were higher in the women who reported eating three or more 
servings of fish in the month before they were tested. It is reasonable 
to conclude that methylmercury contained in seafood may be responsible 
for elevated levels of Hg in U.S. women of child-bearing age.\41\
---------------------------------------------------------------------------

    \41\ 289 JAMA 1667 (April 2, 2003).
---------------------------------------------------------------------------

    As described below, the analysis supporting today's action focuses 
on assessing exposure from freshwater fish caught and consumed by 
recreational and subsistence anglers because available information 
indicate that U.S. utility Hg emissions may affect the methylmercury 
concentrations in these fish. EPA also considered the following fish 
consumption pathways: Consumption from commercial sources (including 
saltwater and freshwater fish from domestic and foreign producers); 
consumption of recreationally caught marine fish, consumption of 
recreationally caught estuarine fish; and consumption of commercial 
fish raised at fish farms (aquaculture). For a number of reasons, as 
explained in the TSD, current information does not suggest that these 
latter pathways present meaningful risks of ingestion of utility-
attributable methylmercury.
    The EPA's 1997 Mercury Study Report to Congress suggests a 
plausible link between anthropogenic releases of Hg from industrial and 
combustion sources in the U.S. and methylmercury in fish in the U.S. 
However, other sources of Hg emissions, including Hg from natural 
sources (such as volcanos) and anthropogenic emissions in other 
countries, contribute to the levels of methylmercury observed in fish 
in the U.S.\42\ Our current understanding of the global Hg cycle and 
the impact of the anthropogenic sources allow us to make estimates on a 
global, continental, or regional scale of their relative importance. It 
is more difficult to make accurate predictions of the fluxes on a local 
scale given our current understanding.
---------------------------------------------------------------------------

    \42\ Recent Hg estimates (which are highly uncertain) of annual 
total global emissions from all sources (natural and anthropogenic) 
are about 5,000 to 5,500 tons per year (tpy). Of this total, about 
1,000 tpy are estimated to be natural emissions and about 2,000 tpy 
are estimated to be contributions through the natural global cycle 
of re-emissions of Hg associated with past natural releases and 
anthropogenic activity. Current anthropogenic emissions account for 
the remaining 2,000 tpy. Given the global estimates noted above, 
U.S. anthropogenic Hg emissions are estimated to account for roughly 
3 percent of the global total, and U.S. utilities are estimated to 
account for about 1 percent of total global emissions. Deposition 
from U.S. utilities is described in greater detail below. Utility 
RTC at 7-1 to 7-2; Mercury NPR, 69 FR 4657-58 (January 20, 2004); 
RIA for CAMR chapters 5-6.
---------------------------------------------------------------------------

    We recognize that it is also difficult to quantify with precision 
how a specific change in air deposition of Hg leads to a change in fish 
tissue levels. We further recognize that the relationship between the 
amount of Hg emissions reduced and the attendant reduction in 
methlymercury fish concentrations depends upon the specific 
characteristics of the waterbody at issue. Nevertheless, science 
continues to evolve and EPA has made substantial progress in developing 
methods for assessing the amount of methylmercury in fish tissues that 
may be traced to emissions from coal-fired U.S. Utility Units. We 
describe our methodology below and why this methodology is sufficient 
to support today's action.
    As discussed above, we are focusing on consumption of self-caught, 
freshwater fish. We estimate that there are approximately 27.9 million 
recreational freshwater fishers in the U.S. population, including 
fishers who do not eat (e.g., release) their catch. Based on 
application of a ``consuming'' factor and a ``sharing'' factor to the 
estimate of recreational fishers, as discussed further in the RIA to 
CAMR, we estimate that approximately 58.6 million individuals in the 
U.S. population consume recreationally-caught freshwater fish. Of these 
individuals, we estimate that approximately 7.5 to 10.5 million are 
women of child-bearing age (that is, 15-44 years old), about 500,000 of 
whom are expected to give birth in any one year. We estimate that the 
mean recreational freshwater fish consumption rate for these women is 8 
grams/day, and the 95th percentile recreational freshwater fish 
consumption rate is 25 grams/day. A subset of recreational freshwater 
fish consumers may consume at higher levels, as discussed below. In 
addition, subsistence fishers and fishers in certain ethnic groups are 
expected to have generally higher fish consumption rates than consumers 
of recreational freshwater fish. These sub-populations are discussed 
below.

B. The Methylmercury Reference Dose

    EPA generally quantifies risk of adverse health effects other than 
cancer by calculating a reference value (RfV). In general, an RfV is an 
estimation of an exposure that is likely to be without an appreciable 
risk of adverse effects over a lifetime. See http://www.epa.gov/iris/gloss8.htm. RfVs for exposure by ingestion are called reference doses 
(RfD).
    The EPA defines an RfD as ``an estimate (with uncertainty spanning 
perhaps an order of magnitude) of a daily oral exposure to the human 
population (including sensitive subgroups) that is likely to be without 
an appreciable risk of deleterious effects during a lifetime. It can be 
derived from a NOAEL (no observed adverse effect level), LOAEL (lowest 
observed adverse effect level), or benchmark dose, with uncertainty 
factors generally applied to reflect limitations of the data used.'' 
See http://www.epa.gov/iris/gloss8.htm.
    As stated above, an RfD is derived by choosing a point of departure 
from animal or human data. This can be a NOAEL or LOAEL, either of 
which may be defined by applying statistical tests and scientific 
judgment to the data. When the data are sufficient, one can apply a 
mathematical model to obtain a benchmark dose (BMD). The BMD is the 
dose at which a particular level of response (i.e., the benchmark 
response,

[[Page 16013]]

or BMR) for some outcome of concern is found to occur. One can then 
derive a BMD lower confidence limit (BMDL), which is a statistical 
lower bound on the chosen BMD, an exposure expected to produce a 
specified effect in some defined percentage of a test population.
    The point of departure (again, NOAEL, LOAEL, or BMDL) is divided by 
uncertainty/variability factors to arrive at the RfD. The uncertainty 
factors are intended to account for variability and uncertainty in the 
data. The size of an uncertainty/variability factor is determined by 
the adequacy or limitations of the data and is typically either 10 or 3 
for each type of variabilty. For example, uncertainty factors may be 
employed for extrapolating from animals to humans, variability in human 
susceptibility (sensitive populations), and extrapolating from 
subchronic to chronic exposures. The resulting RfD is believed to be 
the amount of a chemical which, when ingested daily over a lifetime, is 
likely to be without an appreciable risk of deleterious effects to 
humans, including sensitive subpopulations.
    In 2001, EPA published an RfD for methylmercury that is based on a 
BMD approach. This quantitative risk estimate was based on data from 
developmental neurotoxicity studies mentioned above; specifically, 
deficits in tests associated with ability to learn and process 
information. EPA applied an uncertainty/variability factor of 10 to the 
point of departure (BMDL) to derive the RfD. EPA's RfD for 
methylmercury is 0.1 [mu]g/kg bw/day, which is 0.1 micrograms of Hg per 
day for each kilogram of a person's body weight.
    As noted in the Hg Proposal, at the direction of Congress, EPA 
funded the NAS to perform an independent evaluation of the available 
data related to the health impacts of methylmercury and provide 
recommendations for EPA's RfD. The NAS/National Research Council (NRC) 
conducted an 18-month study of the available data on the health effects 
of methylmercury. The review by the NAS, published in July 2000, 
concluded that the neuro-developmental effects are the most sensitive 
and well-documented effects of methylmercury exposure. The NRC advised 
revising the basis of the RfD, which used data from a short-term 
exposure in Iraq, to incorporate new studies on children exposed in 
utero when their mothers ate seafood containing Hg. EPA subsequently 
established a reference dose of 0.0001 mg/kg bw/day. NAS determined 
that EPA's RfD ``is a scientifically justified level for the protection 
of public health.''
    The methylmercury RfD is further described in the RIA, chapter 2 
and in other EPA documents (IRIS, U.S. EPA 2001; Water Quality Criteria 
for the Protection of Human Health: Methylmercury, EPA-823-R-01-001). 
Briefly, EPA used as the point of departure BMDLs for multiple 
endpoints from the three studies of in utero methylmercury exposure and 
effects. These were conducted in the Faroes and Seychelles Islands and 
in New Zealand.\43\ All of the endpoints were children's scores on 
neuropsychological tests. Consistent with NRC recommendations, an 
uncertainty/variability factor of 10 was used to account for 
pharmacokinetic and pharmacodynamic variability in the human 
population. In the EPA documents, one data set from the Faroes (Boston 
Naming Test, full cohort) is displayed for all calculations as an 
example of the multiple BMDLs which serve as the basis for the RfD.
---------------------------------------------------------------------------

    \43\ More specifically, the subjects of the Seychelles 
longitudinal prospective study were 779 mother-infant pairs from a 
fish-eating population (Myers et al., 1995a-c, 1997; Davidson et 
al., 1995, 1998). Infants were followed from birth to 5.5 years of 
age, and assessed at various ages on a number of standardized 
neuropsychological endpoints. The independent variable was maternal-
hair Hg levels. The Faroe Islands study was a longitudinal study of 
about 900 mother-infant pairs (Grandjean et al., 1997). The main 
independent variable was cord-blood Hg; maternal-hair Hg was also 
measured. At 7 years of age, children were tested on a variety of 
tasks designed to assess function in specific behavioral domains. 
The New Zealand study was a prospective study in which 38 children 
of mothers with hair Hg levels during pregnancy greater than 6 ppm 
were matched with children whose mothers had lower hair Hg levels 
(Kjellstrom et al., 1989, 1986). At 6 years of age, a total of 237 
children were assessed on a number of neuropsychological endpoints 
similar to those used in the Seychelles study (Kjellstrom et al., 
1989). The Seychelles study yielded no statistically significant 
evidence of impairment related to in utero methylmercury exposure, 
whereas the other two studies found dose-related effects on a number 
of neuropsychological endpoints. In the assessment described here, 
an integrative analysis of all three studies was relied upon in 
setting the point of departure for derivation of the RfD. As noted 
by NRC in reference to data from the Seychelles, Faroe Islands, and 
New Zealand, ``because those data are epidemiological, and exposure 
is measured on a continuous scale, there is no generally accepted 
procedure for determining a dose at which no adverse effects 
occur.'' (NRC 2000)
---------------------------------------------------------------------------

    In determining the RfD for methylmercury, EPA said that the ``RfD 
can be considered a threshold for a population at which it is unlikely 
that adverse effects will be observed'' (Water Quality Criteria for the 
Protection of Human Health: Methylmercury, EPA-823-R-01-001). The RfD 
was calculated to be a level ``likely to be without an appreciable 
risk,'' of ``deleterious effects'' for all populations, including 
sensitive subgroups. EPA does not further quantify the degree of risk 
which would be expected for exposures at or above the methylmercury 
RfD. This is the case for all of EPA's RfDs. Additional regulatory 
values support a similar threshold approach for describing risks to 
methylmercury exposure. For example, the World Health Organization sets 
the level at 0.23 [mu]g/kg/day; Health Canada sets the level at 0.2 
[mu]g/kg/day; and the Agency for Toxic Substances and Disease Registry 
(ATSDR) sets a value of 0.3 [mu]g/kg/day.
    EPA has established the RfD at a level such that exposures at or 
below the RfD are unlikely to be associated with appreciable risk of 
deleterious effects. It is important to note, however, that the RfD 
does not define an exposure level corresponding to zero risk; exposure 
near or below the RfD could pose a very low level of risk which EPA 
deems to be non-appreciable. It is also important to note that the RfD 
does not define a bright line, above which individuals are at risk of 
adverse effects.
    Further, in EPA's 1989 Residual Risk Report to Congress, we stated:

    It should be noted that exposures above an RfD or RfC do not 
necessarily imply unacceptable risk or that adverse health effects 
are expected. Because of the inherent conservatism of the RfC/RfD 
methodology, the significance of exceedances must be evaluated on a 
case-by-case basis, considering such factors as the confidence level 
of the assessment, the size of UF used, the slope of the dose-
response curve, the magnitude of the exceedance, and the number or 
types of people exposed at various levels above the RfD or RfC.\44\
---------------------------------------------------------------------------

    \44\ U.S. Environmental Protection Agency. 1989. Risk Assessment 
Guidance for Superfund: Volume I. Human Health Evaluation Manual 
(Part A). Office of Emergency and Remedial Response. Washington, DC, 
EPA/541/1-89/002, at 52-53 http://www.epa.gov/oswer/riskassessment/ragsa/pdf/ch8.pdf (Residual Risk Report). The Residual Risk Report 
further stated:
    It is expected that an HI (i.e., hazard index (HI)), which is 
the sum of more than one hazard quotient for multiple substances 
and/or multiple exposure pathways) less than 1 that is derived using 
target organ specific hazard quotients would ordinarily be 
considered acceptable. If the HI is greater than 1, then the amount 
by which the HI is greater than 1, the uncertainty in the HI, the 
slope of the dose-response curve, and a consideration of the number 
of people exposed would be considered in determining whether the 
risk is acceptable. Evaluation of the acceptable value for an HQ 
(i.e., hazard quotient (HQ), which is the ratio of the exposure 
level to a reference exposure level (e.g., RfD)) or an HI of 1 also 
would consider the values of UFs (i.e., uncertainty/variability 
factor (UF)), which is a default factor--generally 10-fold--used in 
operationally deriving the RfD or RfC from experimental data) and 
the confidence in the RfC that are used in the calculation of the 
HI. In general, it is considered that each UF is somewhat 
conservative; because all factors are not likely to simultaneously 
be at their most extreme (highest) value, a combination of several 
factors can lead to substantial conservatism in the final value. 
Larger composite UF lead to more conservative RfC. Conversely, lower 
composite UF are less conservative and usually indicate a higher 
level of confidence in the RfC. Intermediate UF values or a mixture 
of high and low UF would require an examination of the relative 
contribution of various chemicals to the HI. Thus, an HI or HQ 
greater than 1 may be considered acceptable based on consideration 
of other factors.
    Id. at 125.

---------------------------------------------------------------------------

[[Page 16014]]

C. Methylmercury Levels in Fish and the Methylmercury Water Quality 
Criterion

    As noted above, the most important pathway of exposure to Hg for 
humans is through the consumption of fish and seafood. These include 
saltwater fish such as tile fish, shark, and swordfish, which are most 
often caught commercially. They also include freshwater fish such as 
bass, perch, and walleye, which are often caught recreationally, 
commercially, or for personal consumption or distribution. Generally 
shellfish have lower levels of methylmercury than do finfish. The 
levels of Hg in fish and shellfish are variable, with mean levels 
ranging from non-detectable to 1.45 mg/kg, depending on species. See 
FDA Mercury Levels in Commercial Fish and Shellfish (http://
www.cfsan.fda.gov/frf/sea-mehg.html).
    Methylmercury exposure is a function of how much fish is eaten (on 
a bodyweight basis), how frequently fish is eaten, and the 
methylmercury concentration in the fish. As a result, estimates of the 
amount and type of fish consumption are important to assessing the 
impacts of methylmercury attributed to coal-fired Utility Units on 
public health.
    Hg is emitted from powerplants in three forms: Elemental Hg, 
reactive (oxidized) Hg, and particulate Hg. Most of the local and 
regional Hg deposition is associated with the emissions of reactive Hg. 
For this reason, the magnitude of reactive Hg emission from powerplants 
is critical to Hg deposition in the United States. As noted above, FGD 
and SCR control technologies are most effective in controlling reactive 
Hg emissions. As indicated by Table VI-2, roughly 90 percent of the Hg 
reductions under CAIR in 2020 are reactive Hg. As a result, the 
SO2 and NOX limits established by CAIR yield 
significant reductions (roughly 70 percent) in reactive Hg emissions 
from powerplants.
    Americans eat fish from a variety of sources. An individual's fish 
diet can be composed of commercial fish and shellfish (both imported 
and domestic), fish from aquaculture (or farm raised fish for 
commercial sale), and fish from non-commercial sources (e.g., 
recreationally caught fish, fish caught to meet dietary needs, and/or 
fish caught for cultural or traditional reasons). These fish may come 
from marine, estuarine, or freshwater sources.
    Using the 2001 RfD and information on Hg exposure routes, EPA 
published a recommended ambient water quality criterion for the states' 
and tribes' use in setting water quality standards for U.S. waters 
(freshwater and estuarine) that are designed to protect human health. 
EPA issued the methylmercury water quality criterion in 2001. Water 
Quality Criterion for the Protection of Human Health: Methylmercury. 
EPA-823-R-01-001. Office of Science and Technology, Office of Water, 
USEPA, Washington, DC, USEPA 2001) Because of the wide variability in 
methylmercury bioaccumulation among waterbodies, EPA set the criterion 
as a fish tissue level rather than as an ambient water concentration. 
The criterion is 0.3 mg/kg (milligram methylmercury per kilogram of 
wet-weight fish tissue). The criterion is a risk assessment number that 
states and authorized tribes may use in their programs for protection 
of designated uses.
    The Clean Water Act (CWA) and EPA's regulations specify 
requirements for adoption of water quality criteria. States and 
authorized tribes must adopt water quality criteria that protect 
designated uses. See CWA section 303(c)(2)(A). Water quality criteria 
must be based on a sound scientific rationale and must contain 
sufficient parameters or components to protect the designated uses. See 
40 CFR 131.11. States and authorized tribes must adopt criteria for all 
toxic pollutants where EPA has established ambient water quality 
criteria where the discharge or presence of these pollutants could 
reasonably interfere with the designated uses. See CWA Section 
303(c)(2)(B). EPA issued guidance on how states and authorized tribes 
may comply with section 303(c)(2)(B) which is now contained in the 
Water Quality Standards Handbook: Second Edition (EPA, 1994). States 
and authorized tribes that decide to use the recommended methylmercury 
criterion as the basis for new or revised methylmercury water quality 
standards have the option of adopting the criterion as a fish tissue 
concentration into their water quality standards, adjusting the 
criterion to account for state or local exposure, or adopting it as a 
traditional water column concentration. States and authorized tribes 
remain free not to use EPA's current recommendations, provided that 
their new or revised water quality criteria for methylmercury protect 
the designated uses and are based on a scientifically defensible 
methodology.
    The methylmercury water quality criterion incorporated the RfD, 
data on freshwater and estuarine finfish and shellfish consumption for 
the target population (the adult general population), and information 
on exposure to methylmercury as a result of consumption of marine fish 
(for methylmercury, exposure from any route other than eating fish is 
negligible). Specifically, EPA assumed a default intake of freshwater 
and estuarine and marine finfish and shellfish of 17.5 grams per day 
(or two 8-ounce meals a month) conforming to EPA's methodology. (EPA; 
``Methodology for Deriving Ambient Water Quality Criteria for the 
Protection of Human Health (2000),'' EPA-822-B-00-004 (October 2000) 
(``2000 Water Quality Criteria Methodology'')). This default (to be 
used by EPA for national criteria or others in the absence of data 
specific to a waterbody) is the 90th percentile total (commercial and 
non-commercial) freshwater and estuarine finfish and shellfish 
consumption reported by adults, both consumers and non-consumers. The 
source of this data is the 1994-1996 Continuing Study of Food Intake by 
Individuals (CSFII). This is a large ongoing U.S. food consumption 
survey conducted by USDA.
    In addition, in accordance with EPA's published methodology, in 
developing the criterion, EPA used a relative source contribution (RSC) 
approach to apportion the RfD to ensure that the water quality 
criterion is protective, given other sources of exposure. The RSC 
approach apportions the RfD according to routes of exposures; for 
methylmercury this adjustment was done to account for marine fish 
consumption, as the criterion is for freshwater and estuarine finfish 
and shellfish. In deriving the methylmercury water quality criterion, 
EPA assumed an exposure to methylmercury in marine fish that is 
equivalent to 27 percent of RfD. That is, EPA developed the criterion 
so that it would be protective even if an individual is consuming 
typical amounts of fish from other sources (i.e., marine fish).

D. EPA's Methodology for Assessing Methylmercury Levels in Fish Tissues

    To estimate methylmercury levels, including methylmercury 
attributable to Utility Units, in consumed freshwater fish, EPA's 
analysis relied primarily on monitoring data (i.e., fish tissue samples 
collected from freshwater sites across the study area). EPA used 
sources of national-level monitored Hg data. The

[[Page 16015]]

National Listing of Fish and Wildlife Advisories (NLFA), which is 
maintained by EPA, contains data from over 80,000 fish tissue samples 
across the U.S. In addition to the NLFA, EPA's National Fish Tissue 
Survey (NFTS) provides useful data. Conducted in 2000-2003, this 
dataset includes fish tissue samples from 500 randomly selected lakes 
and reservoirs across the U.S. EPA considers these combined two data 
sets to be sufficiently comprehensive and sufficiently inclusive of the 
waterbodies of highest exposure for use in EPA's regional analysis, 
although, as discussed in the TSD, for certain areas of the country, 
gaps in the datasets have led EPA to rely on overall regional trends to 
draw conclusions for local areas.
    The NLFA is the most extensive available source of fish tissue 
sampling data for Hg. It currently includes fish tissue contaminant 
data collected by states (and submitted to EPA) from over 10,000 
locations nationwide, with most of the locations in the eastern half of 
the U.S. In general, the States historically sampled waterbodies in 
areas of suspected contamination. More recently, states have also 
focused sampling efforts on areas of elevated fishing pressure. Almost 
all of the tissue samples include tests for Hg. The NLFA includes 
roughly 83,000 Hg samples collected in the U.S. between 1967 and 2002. 
In the dataset, most samples are described according to the sample 
location, sample date, measured Hg concentration, species and size of 
fish, and the part of the fish sampled.
    Based on the geographic coordinates provided in the NLFA database, 
EPA also defined two additional fields for each Hg sample:

--The eight-digit watershed (hydrological unit code (HUC) (discussed 
below)) in which the sample was located; and
--The type of waterbody (i.e., lake or river/stream) from which the 
sample was taken.

    The HUC, developed by the USGS, spatially delineates watersheds 
throughout the United States. Hydrologic units are available at four 
levels of aggregation, ranging from a two-digit regional level (21 
units nationwide) to the eight-digit HUC (2,150 distinct units). The 
eight-digit HUC-level designation is useful for this analysis because 
it provides a nationally consistent approach for grouping waterbodies 
on a ``local'' scale (the average HUC area is 1,631 sq mi).\45\
---------------------------------------------------------------------------

    \45\ More information regarding these hydrological units can be 
found through the USGS Web site http://water.usgs.gov/GIS/huc.html.
---------------------------------------------------------------------------

    We made the water body type assignments using proximity analysis in 
ArcINFO. Each sampling site was assigned to either a flowing (e.g., 
river, stream) or a stationary (e.g., lake, reservoir) waterbody, 
according the type of waterbody most closely located to the site's lat/
long coordinates. We used National Hydrology Dataset (NHD) in the 
proximity analysis.
    For purposes of the modeling described below, we restricted the 
samples selected from the NLFA data to those that met the following 
criteria:
     Collected after 1999;
     Sampled from freshwater species (i.e., saltwater species 
are excluded from the analysis); and
     Sampled from freshwater (rather than estuarine or coastal) 
waterbodies.
    These NLFA Hg sampling data were supplemented with additional 
observations from EPA's National Fish Tissue Survey (NFTS). Compiled in 
2000-2003, this dataset includes fish tissue samples from 500 randomly 
selected lakes and reservoirs across the U.S. Combining data from NLFA 
and NFTS, samples from 1633 lake and river sampling sites were selected 
for the analysis.
    Although the NLFA and NFTS provide rich sources of data on Hg 
levels in freshwater fish for the study area, the fish tissue samples 
in these databases vary in several respects. For example, they vary 
according to the size and species of fish sampled and according to the 
sampling method used (e.g., the cut of fish sampled). We limited the 
samples we used for this analysis to fish likely to be caught and 
consumed, defined for this analysis as fish greater than or equal to 
seven inches in length.
    The TSD describes in more detail how we used the data available in 
the NLFA and NFTS datasets.

E. Air Quality Modeling of the Impacts of Utility Unit Hg on Fish 
Tissue Levels

    EPA conducted computerized modeling that indicates the effects of 
various scenarios for Utility Unit Hg emissions on fish tissue at the 
NLFA-NFTS sites across the country, in both a 2001 base case and in 
projected control cases for the year 2020. This section summarizes the 
emissions inventories used in those modeling scenarios, and the air 
quality modeling, that serve as the basis for determining the fish 
tissue impacts of Hg from Utility Units at various levels of emissions.
    EPA used a sophisticated air quality model to estimate baseline and 
post-control annual total Hg deposition for each scenario. EPA then 
combined the estimated changes in Hg depositions with fish tissue data 
to determine estimated changes in methylmercury levels in fish tissues. 
EPA then combined those changes in fish tissue methylmercury levels 
with estimates of fish consumption, for use in estimating exposure 
levels.
1. Air Quality Modeling for Hg Deposition From Utility Mercury 
Emissions
    This section summarizes the methods for estimating Hg deposition 
for 2001 and 2020 base cases and control scenarios. EPA estimated the 
Hg deposition changes using national-scale applications of the 
Community Multi-Scale Air Quality (CMAQ) model in the contiguous United 
States.
    a. CMAQ Model and Hg Deposition Estimates. CMAQ is a three-
dimensional grid-based Eulerian air quality model designed to estimate 
annual particulate concentrations and Hg deposition over large spatial 
scales (e.g., over the contiguous United States). Because it accounts 
for spatial and temporal variations as well as differences in the 
reactivity of emissions, CMAQ is useful for evaluating the impacts of 
changes in utility Hg emissions, under various scenarios, on U.S. Hg 
deposition. Our analysis applies the modeling system to the entire 
United States for the following emissions scenarios:
    (1) A 2001 base year;
    (2) A 2001 base year of utility Hg emissions only;
    (3) A 2020 projection that includes utility Hg emissions as reduced 
through implementation of CAIR;
    (4) A 2020 projection with utility Hg emissions zeroed-out; \46\
---------------------------------------------------------------------------

    \46\ The reference to ``zeroed out'' means that the modeled 
inventory did not include any amount of Hg emissions from utilities. 
This ``zero-out'' technique allows focus on the impact of the 
utilities alone.
---------------------------------------------------------------------------

    (5) A 2020 projection that includes utility Hg emissions as reduced 
through implementation of CAMR (which, in turn, reflects both CAIR 
reductions and the reductions from the additional, 2018 controls); and
    (6) A 2020 projection that includes utility Hg emissions as reduced 
through a second CAMR option (this second CAMR option reflects both 
CAIR reductions and a set of additional reductions that are tighter 
than the ones adopted in CAMR).
    The CMAQ version 4.3 was employed for this CAMR modeling analysis. 
This version reflects updates in a number of areas to improve 
performance and address comments from the peer review. CMAQ simulates 
every hour of every day of the year and, thus, requires a

[[Page 16016]]

variety of input files that contain information pertaining to the 
modeling domain and simulation period. These include hourly emissions 
estimates and meteorological data in every grid cell, as well as a set 
of pollutant concentrations to initialize the model and to specify 
concentrations along the modeling domain boundaries. These initial and 
boundary concentrations were obtained from output of a global chemistry 
model. We use the model predictions in a relative sense by first 
determining the ratio of Hg deposition predictions. The calculated 
relative change is then combined with the corresponding fish tissue 
concentration data to project fish tissue concentrations for the future 
case scenarios.
    b. Modeling Domain and Simulation Periods. The modeling domain 
encompasses the lower 48 States and extends from 126 degrees to 66 
degrees west longitude and from 24 degrees north latitude to 52 degrees 
north latitude. The modeling domain is segmented into rectangular 
blocks referred to as grid cells. The model actually predicts pollutant 
concentrations for each of these grid cells. For this application, the 
horizontal grid cells are roughly 36 km by 36 km. In addition, the 
modeling domain contains 14 vertical layers with the top of the 
modeling domain at about 16,200 meters. Within the domain each vertical 
layer has 16,576 grid cells.
    The simulation periods modeled by CMAQ included separate full-year 
application for each of the emissions scenarios modeled.
    c. Model Inputs. CMAQ requires a variety of input files that 
contain information pertaining to the modeling domain and simulation 
period. These include gridded, hourly emissions estimates and 
meteorological data and initial and boundary conditions. Separate 
emissions inventories were prepared for the 2001 base year and each of 
the future-year base cases and control scenarios. All other inputs were 
specified for the 2001 base year model application and remained 
unchanged for each future-year modeling scenario.
    CMAQ requires detailed emissions inventories containing temporally 
allocated emissions for each grid cell in the modeling domain for each 
species being simulated. The previously described annual emission 
inventories were preprocessed into model-ready inputs through the 
emissions preprocessing system. Details of the preprocessing of 
emissions are provided in the Clean Air Interstate Rule Emissions 
Inventory Technical Support Document (Emissions Inventory TSD). 
Meteorological inputs reflecting 2001 conditions across the contiguous 
United States were derived from version 5 of the Mesoscale Model (MM5). 
These inputs include horizontal wind components (i.e., speed and 
direction), temperature, moisture, vertical diffusion rates, and 
rainfall rates for each grid cell in each vertical layer.
    The lateral boundary and initial species concentrations are 
provided by a three-dimensional global atmospheric chemistry and 
transport model (GEOS-CHEM). The lateral boundary species 
concentrations varied with height and time (every 3 hours). Terrain 
elevations and land use information were obtained from the U.S. 
Geological Survey database at 10 km resolution and aggregated to the 
roughly 36 km horizontal resolution used for this CMAQ application.
    d. CMAQ Model Evaluation. An operational model performance 
evaluation for Hg wet deposition for 2001 was performed to estimate the 
ability of the CMAQ modeling system to replicate base-year wet 
deposition of Hg. Because measurements for the dry deposition of Hg do 
not currently exist, the modeled dry deposition performance could not 
be evaluated. The wet deposition evaluation principally comprises 
statistical assessments of model versus observed pairs that were paired 
in time and space on a weekly basis. This evaluation includes 
comparisons of model predictions to the corresponding weekly 
measurements from the Mercury Deposition Network (MDN).
    As discussed in the TSD, in EPA's view, CMAQ model performance for 
wet deposition shows very good agreement with the MDN monitoring sites 
with an underprediction bias well within accepted performance criteria. 
It should be noted that the application of a sophisticated 
photochemical grid model like CMAQ has been demonstrated to be 
appropriate to support national and regional assessments of control 
strategies on atmospheric concentrations such as today's rule. 
Therefore, for purposes of assessing impacts on regional patterns of Hg 
deposition, we aggregate individual CMAQ grids to watersheds.
2. Emission Inventories and Estimated EGU (Utility Unit) Emission 
Reductions
    As discussed in the Clean Air Mercury Rule Emission Inventory 
Technical Memorandum, EPA developed 2001 and 2020 Hg emission 
inventories for the air quality modeling. EPA relied on the 2001 Hg 
emission inventory as the base case. The base case consists of the 
level of Hg emissions, including Utility Unit emissions reduced by 
controls implemented for purposes of the acid deposition provisions and 
for other purposes, before reductions under CAIR (required under CAA 
section 110(a)(2)(D)) or CAMR (required under section 111). For 
comparison purposes, EPA also conducted an air quality modeling run of 
the 2001 Hg emissions inventories with Utility Units' Hg emissions 
``zeroed out.'' EPA relied on the Integrated Planning Model (IPM), 
discussed below, to develop projections of EGU emissions for 2020. The 
2020 utility Hg emission inventories reflect reductions under various 
control scenarios.
    a. Use of IPM for Estimating Utility Unit Emissions. EPA projected 
future Hg emissions from the power generation sector using the IPM. The 
EPA uses IPM to analyze the projected impact of environmental policies 
on the electric power sector in the 48 contiguous states and the 
District of Columbia.
    IPM is a multi-regional, dynamic, deterministic linear programming 
model of the U.S. electric power sector. The EPA used IPM to project 
both the national level and the unit level of Utility Unit Hg emissions 
under different control scenarios. The EPA also used IPM to project the 
costs of those controls.
    As noted elsewhere, the CAIR SO2 and NOX 
controls provide the basis for reducing Hg to the CAIR co-benefit 
levels in 2010 and 2020. EPA assumed that states would choose to 
implement the CAIR-required SO2 and NOX 
reductions by controlling Utility Units, and by doing so through the 
EPA-administered cap-and-trade program. This assumption is reasonable, 
for present purposes, because of the cost-savings associated with the 
cap-and-trade program.
    EPA used IPM to project the distribution within the utility 
industry of the emission controls to comply with CAIR. EPA then was 
able to use IPM to project the amount, and geographic distribution, of 
Hg emissions that would result from implementation of those CAIR-
required emissions controls. In addition, EPA used IPM to project the 
geographic distribution of the additional emissions controls under 
section 111, and the associated costs.
    In these IPM runs, EPA assumed that states would implement the Hg 
requirements through the Hg cap-and-trade program that EPA is 
establishing. EPA further assumed that the States would implement the 
additional reductions under section 111, beginning in 2010, through the 
same cap-and-trade program. The cap-and-trade program is implemented in 
two phases, with a cap

[[Page 16017]]

of 38 tons in 2010 (set at the co-benefits reduction under CAIR) and a 
lower cap of 15 tons in 2018. EPA modeling of section 111 projects 
banking of excess Hg reductions in the 2010 to 2017 timeframe for 
compliance with the cap in 2018 and beyond timeframe. Although states 
are not required to adopt the EPA-administered trading program, this 
program assures that those reductions will be achieved with the least 
cost. For that reason, EPA believes it reasonable to assume that States 
will adopt the program.
    The National Electric Energy Data System (NEEDS) contains the 
generation unit records used to construct model plants that represent 
existing and planned/committed units in EPA modeling applications of 
IPM. The NEEDS includes basic geographic, operating, air emissions 
requirements, and other data on all the generation units that are 
represented by model plants in EPA's v.2.1.9 update of IPM.
    The IPM uses model run years to represent the full planning horizon 
being modeled. That is, several years in the planning horizon are 
mapped into a representative model run year, enabling IPM to perform 
multiple year analyses while keeping the model size manageable. 
Although IPM reports results only for model run years, it takes into 
account the costs in all years in the planning horizon. In EPA's 
v.2.1.9 update of IPM, the years 2008 through 2012 are mapped to run 
year 2010, and the years 2013 through 2017 are mapped to run year 2015, 
and the years 2018 through 2022 are mapped to 2020.\47\ Model outputs 
for 2009 and 2010 are from the 2010 run year. More detail on IPM can be 
found in the model documentation in the docket or at http://www.epa.gov/airmarkets/epa-ipm ipm and more discussion of modeled 
scenarios can be found in the Regulatory Impact Assessment for CAIR and 
CAMR in the docket.
---------------------------------------------------------------------------

    \47\ An exception was made to the run year mapping for an IPM 
sensitivity run that examined the impact of a NOX Early 
Reduction Pool (ERP). In that run the years 2009 through 2012 were 
mapped to 2010 and 2008 was mapped to 2008.
---------------------------------------------------------------------------

    IPM has been used for evaluating the economic and emission impacts 
of environmental policies for over a decade. The model's base case 
incorporates title IV of the Clean Air Act (the Acid Rain Program), the 
NOX SIP Call, various New Source Review (NSR) settlements, 
and several state rules affecting emissions of SO2 and 
NOX that were finalized prior to April of 2004. The NSR 
settlements include agreements between EPA and certain utilities. IPM 
also includes various current and future state programs in Connecticut, 
Illinois, Maine, Massachusetts, Minnesota, New Hampshire, North 
Carolina, New York, Oregon, Texas, and Wisconsin. IPM includes state 
rules that have been finalized and/or approved by a state's legislature 
or environmental agency. The base case is used to provide a reference 
point to compare environmental policies and assess their impacts and 
does not reflect a future scenario that EPA predicts will occur.
    EPA's modeling is based on various input assumptions that are 
uncertain, particularly assumptions for Hg control technology, future 
fuel prices and electricity demand growth. While IPM contains an 
assumption of 90% Hg removal for ACI and, for modeling convenience, 
does not constrain the timeframe for the availability of technology, 
this should not be interpreted as implying any assessment of the 
availability of technology. For further discussion of the availability 
of Hg technology, see EPA's Office of Research and Development (ORD) 
Control of Emissions from Coal-Fired Electric Utility Boilers: An 
Update, EPA/Office of Research and Development, March 2005, in CAMR 
docket. There may also be technologies available for SO2 and 
NOX control that are not accounted for in IPM. Therefore the 
technologies that plants may use to comply with this program may not be 
accurately projected by IPM in all cases. These and other assumptions 
and uncertainties are discussed further in the RIA for CAIR and CAMR in 
the docket. More detail on IPM can be found in the model documentation, 
which provides additional information on the assumptions discussed here 
as well as all other assumptions and inputs to the model (see docket or 
http://www.epa.gov/airmarkets/epa-ipm ipm).
    b. Emission Estimates. The emission sources and the basis for 
current and future-year inventories are listed in Table VI-1. Table VI-
2 summarizes the Hg emissions and the change in the emissions from EGUs 
(Utility Units) that we expect to result under the various EGU control 
scenarios (under CAIR and CAMR) that we used in modeling deposition 
changes.

             Table VI--1. Emission Sources and Basis for Current and Future-Year Mercury Inventories
----------------------------------------------------------------------------------------------------------------
                                                                                          Future-year base case
                Sector                     Emissions source          2001 Base year            projections
----------------------------------------------------------------------------------------------------------------
EGU..................................  Power industry electric  1999 National Emission   Integrated Planning
                                        generating units         Inventory (NEI) data.    Model (IPM).
                                        (EGUs).
Non-EGU point sources................  Non-Utility Point......  1999 NEI, with medical   (1) Department of
                                                                 waste incinerator        Energy (DOE) fuel use
                                                                 sources replaced with    projections, (2)
                                                                 draft 2002 NEI.          Regional Economic
                                                                                          Model, Inc. (REMI)
                                                                                          Policy Insight[supreg]
                                                                                          model, (3) decreases
                                                                                          to REMI results based
                                                                                          on trade associations,
                                                                                          Bureau of Labor
                                                                                          Statistics (BLS)
                                                                                          projections and Bureau
                                                                                          of Economic Analysis
                                                                                          (BEA) historical
                                                                                          growth from 1987 to
                                                                                          2002, (4) Maximum
                                                                                          Achievable Control
                                                                                          Technology category
                                                                                          growth and control
                                                                                          assumptions.
Non-point............................  All other stationary     1999 NEI, with medical   Same as above.
                                        sources inventoried at   waste incinerator
                                        the county level.        sources replaced with
                                                                 draft 2002 NEI.
----------------------------------------------------------------------------------------------------------------
This table documents only the sources of data for the U.S. inventory. The sources of data used for Canada and
  Mexico are explained in the technical support memorandum and were held constant from the base year to the
  future years.


[[Page 16018]]


                  Table VI--2. Summary of Modeled Mercury Emissions for Clean Air Mercury Rule
----------------------------------------------------------------------------------------------------------------
                                                          Reactive gaseous     Particulate
                                      Elemental mercury       mercury            mercury         Total mercury
----------------------------------------------------------------------------------------------------------------
                                         2001 Base Case Emissions (tons)
----------------------------------------------------------------------------------------------------------------
EGU Sources.........................              26.26              20.58               1.73              48.57
Non-EGU Point Sources...............              37.85              13.33               7.60              58.78
Area Sources........................               5.05               1.53               0.96               7.54
                                     --------------------
    All Sources.....................              69.16              35.44              10.29             114.89
-------------------------------------
                                 2001 Utility Mercury Emissions Zero-Out (tons)
----------------------------------------------------------------------------------------------------------------
EGU Sources.........................               0.00               0.00               0.00               0.00
Non-EGU Point Sources...............              37.85              13.33               7.60              58.78
Area Sources........................               5.05               1.53               0.96               7.54
                                     --------------------
    All Sources.....................              42.90              14.86               8.56              66.32
-------------------------------------
                                         2020 With CAIR Emissions (tons)
----------------------------------------------------------------------------------------------------------------
EGU Sources.........................              25.72               7.87               0.83              34.42
Non-EGU Point Sources...............              28.03              10.37               6.61              45.01
Area Sources........................               5.69               1.30               0.77               7.76
                                     --------------------
All Sources.........................              59.44              19.54               8.21              87.19
-------------------------------------
                                2020 With CAIR Utility Mercury Emissions Zero-Out
----------------------------------------------------------------------------------------------------------------
EGU Sources.........................               0.00               0.00               0.00               0.00
Non-EGU Point Sources...............              28.03              10.37               6.61              45.01
Area Sources........................               5.69               1.30               0.77               7.76
                                     --------------------
    All Sources.....................              33.72              11.67               7.38              52.77
-------------------------------------
                                             2020 With CAIR and CAMR
----------------------------------------------------------------------------------------------------------------
EGU Sources.........................              17.65               6.57               0.83              25.05
Non-EGU Point Sources...............              28.03              10.37               6.61              45.01
Area Sources........................               5.69               1.30               0.77               7.76
                                     --------------------
    All Sources.....................              51.37              18.24               8.21              77.82
-------------------------------------
                               2020 With CAIR and Alternative CAMR Control Option
----------------------------------------------------------------------------------------------------------------
EGU Sources.........................              14.33               5.71               0.79              20.83
Non-EGU Point Sources...............              28.03              10.37               6.61              45.01
Area Sources........................               5.69               1.30               0.77               7.76
                                     --------------------
    All Sources.....................              48.05              17.38               8.17              73.60
----------------------------------------------------------------------------------------------------------------

    (Note: ``Reactive Gaseous Mercury'' refers to oxidized mercury).
    (Note: Table IV-2 includes projections for all EGUs, including 
other fossil-fired units, and coal-fired units that are less than 25 
MW.)
    c. Projected Hg Emissions. Table VI-3 provides projected total Hg 
emissions levels in 2010, 2015, and 2020. Because of the banking of 
excess emissions reductions under the first phase of the Hg program, 
emissions in the second phase will be initially higher than the caps 
that are required under CAMR.

    Table VI--3. Projected Emissions of Hg with the Base Case \a\ (No
       Further Controls), With CAIR, and With Section 111 Controls
                                 [Tons]
------------------------------------------------------------------------
                                       2010         2015         2020
------------------------------------------------------------------------
Base Case........................         46.6         45.0         46.2
CAIR.............................         38.0         34.4         34.0
CAMR.............................         31.3         27.9         24.3
Alternative CAMR Control Option..         30.9         25.7        20.1
------------------------------------------------------------------------
\a\ Base case includes Title IV Acid Rain Program, NOX SIP Call, and
  state rules finalized before March 2004.
Source: Integrated Planning Model run by EPA.


[[Page 16019]]

    Emissions projections are presented for affected coal-fired units.
    (Note: Table VI-3 includes projections for all affected units, 
i.e., coal-fired units greater than 25 MW.)
3. Effect of Reductions in Utility Unit Hg Emissions on Regional 
Patterns of Mercury Deposition and Fish Tissue Methylmercury 
Concentrations
    EPA uses CMAQ to predict the effect of the various control 
scenarios on Hg deposition attributable to Utility Units within the 48 
contiguous states. By averaging the 36 km CMAQ gridded deposition 
estimates to the watershed (i.e., HUC-8) level, EPA is able to estimate 
the effectiveness of reductions in utility Hg emissions in achieving 
reductions in deposition attributable solely to Utility Units. In 
addition, by comparing changes in Hg deposition before and after 
implementation of rule requirements at the geographic location of the 
fish tissue sample points, EPA is able to estimate the effect of 
reductions in Hg deposition on fish tissue methylmercury concentrations 
at the sample points.
    EPA generates these changes in Hg deposition by comparing two air 
modeling scenarios (e.g., a control scenario versus a baseline scenario 
for a particular simulation year). EPA then translates these changes in 
Hg deposition into changes in methylmercury fish tissue concentrations 
based on a proportionality assumption: i.e., an incremental percent 
change in deposition produces a matching percentage change in Hg fish 
tissue concentrations.\48\
---------------------------------------------------------------------------

    \48\ US EPA, 2001. Mercury Maps: A Quantitative Spatial Link 
Between Air Deposition and Fish Tissue: Peer Reviewed Final Report. 
EPA-823-R-01-009. Mercury Maps is discussed at length in the TSD.
---------------------------------------------------------------------------

    EPA is able to use these modeled changes in methylmercury fish 
tissue concentrations, together with information about fish 
consumption, to predict changes in population-level Hg exposure. These 
exposure changes reveal the extent to which reductions in Utility Unit 
Hg emissions, and the extent to which remaining Utility Unit Hg 
emissions, affect public health.

F. Fish Tissue Levels of Methylmercury Modeled To Result After 
Implementation of CAIR and CAMR

    This section describes the amounts of Utility Unit attributable Hg 
deposition onto watersheds (termed HUC), as well as the Utility-
attributable methylmercury in fish tissue, all under the various 
control scenarios modeled.
1. Utility-Attributable Hg Deposition Patterns
    The air quality modeling shows that total Hg deposition is not 
highly impacted by utility deposition. The small size of this impact is 
evident when utility emissions are, in effect, zeroed out in the 2001 
base case. The following tables summarize impacts on total Hg 
deposition and Hg deposition attributable to Utility Units.

                                                 Table VI-4.--Summary Statistics for Total Hg Deposition
                                                             [Aggregated to the HUC-8 level]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           2001 Utility   2020 Base case   2020 Utility      2020 CAMR       2020 CAMR
                                                          2001 Base case     zero out       (with CAIR)      zero out      requirements     alternative
--------------------------------------------------------------------------------------------------------------------------------------------------------
Minimum.................................................            6.94            6.94            6.08            5.90            6.08            6.07
Maximum.................................................           54.54           54.38           62.76           62.72           62.76           62.75
50th percentile.........................................           15.92           14.60           14.59           13.92           14.44           14.39
90th percentile.........................................           22.16           19.48           19.46           19.04           19.37           19.33
99th percentile.........................................           32.35           27.20           29.15           28.93           28.96          28.95
--------------------------------------------------------------------------------------------------------------------------------------------------------
(All units are expressed in micrograms per square meters.)


                      Table VI-5. Summary Statistics for Utility Attributable Hg Deposition
                                         [aggregated to the HUC-8 level]
----------------------------------------------------------------------------------------------------------------
                                                                  2020 Base case     2020 CAMR       2020 CAMR
                                                  2001 Base case    (with CAMR)    Requirements     Alternative
----------------------------------------------------------------------------------------------------------------
Minimum.........................................            0.00            0.00            0.00            0.00
Maximum.........................................           19.71            4.03            3.85            3.80
50th percentile.................................            0.39             0.3           10.26            0.22
90th percentile.................................            4.08            1.38            1.16            0.99
99th percentile.................................           10.15            2.56            2.17           2.04
----------------------------------------------------------------------------------------------------------------
(All units are expressed in micrograms per square meters.)

    The median deposition level is reduced by only 8 percent when 
utilities emissions are zeroed out in 2001, suggesting that utilities 
are not a major source of Hg deposition in most HUCs. Even so, at HUCs 
with the highest deposition levels, zeroing out utilities reduces the 
99th percentile deposition level by 16 percent, suggesting that there 
are relatively larger impacts of utilities in high deposition areas.
    By 2020, after implementation of CAIR, significant reductions in 
deposition attributable to utilities occurs. HUCs with high levels of 
utility deposition receive a larger reduction in Utility-attributable 
Hg deposition relative to HUCs with a relatively small level of 
Utility-attributable deposition. Specifically, CAIR results in a 75 
percent reduction in the 99th percentile of Utility-attributable 
deposition, and a 20 percent reduction in the 50th percentile. CAIR 
also shifts the distribution of utility-attributable deposition. In the 
2001 base case, 10 percent of HUCs had greater than 20 percent of 
deposition attributable to utilities. In the 2020 post-CAIR base case, 
no HUCs had greater than 20 percent of deposition attributable to 
utilities, and 90 percent had less than 9 percent of deposition 
attributable to utilities.

[[Page 16020]]

    Additional reductions in Hg emissions due to the CAMR requirements 
result in relatively small additional shifts in the distribution of 
deposition. Additional emissions reductions due to the CAMR 
requirements result in a small additional reduction in the number of 
HUCs with a high percentage of utility-attributable emissions. (The 
incremental impact of the CAMR alternative relative to the promulgated 
CAMR requirements is very small.)
2. EGU-Attributable Methylmercury Fish Tissue Levels
    The following tables summarize the methylmercury fish tissue levels 
associated with the various Utility Unit Hg emissions scenarios. All 
units refer to mg (of methylmercury) per kg (fish tissue), or parts per 
million (ppm). As a frame of reference, it should be noted that EPA's 
default water quality criterion is 0.3 mg/kg.

                                           Table VI--6. Summary Statistics for Total Fish Tissue Methylmercury
                                                                   [Sample locations]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           2001 Utility   2020 Base case                     2020 CAMR       2020 CAMR
                                                          2001 Base case     zero out          CAIR        2020 Zero out   requirements     alternative
--------------------------------------------------------------------------------------------------------------------------------------------------------
Minimum.................................................            0.00            0.00            0.00            0.00            0.00            0.00
Maximum.................................................            4.49            3.64            3.65            3.46            3.63            3.61
50th percentile.........................................            0.25            0.21            0.21            0.20            0.21            0.21
90th percentile.........................................            0.90            0.81            0.79            0.77            0.79            0.78
99th percentile.........................................            1.80            1.65            1.64            1.57            1.63           1.63
--------------------------------------------------------------------------------------------------------------------------------------------------------
(All units are in mg methylmercury per kg fish tissue.)


               Table VI--7. Summary Statistics for Utility Attributable Fish Tissue Methylmercury
                                           [Across sampling locations]
----------------------------------------------------------------------------------------------------------------
                                                                    2020 (with       2020 CAMR       2020 CAMR
                                                     2001 Base         CAIR)       Requirements     Alternative
----------------------------------------------------------------------------------------------------------------
Minimum.........................................            0.00            0.00            0.00            0.00
Maximum.........................................            0.85            0.25            0.19            0.18
50th percentile.................................            0.03            0.01            0.01            0.01
90th percentile.................................            0.11            0.03            0.03            0.03
99th percentile.................................            0.26            0.10            0.09           0.08
----------------------------------------------------------------------------------------------------------------
(All units are in mg methylmercury per kg fish tissue.)

    a. 2001 Base case and 2001 Utility Zero-out. In the 2001 base case, 
as a result of all international and U.S. emissions, and before U.S. 
utilities implement reductions from CAIR or CAMR, the 50th percentile 
of the sample points had an estimated methylmercury fish tissue 
concentration of 0.25 mg/kg. The 90th percentile water body had an 
estimated methylmercury fish tissue concentration of 0.90 mg/kg, and 
the 99th percentile had 1.80 mg/kg.
    The amount of methylmercury attributable solely to utilities in the 
2001 base case, which becomes evident when utilities are zeroed out, is 
of course much smaller. The 50th percentile of the sample points had an 
estimated methylmercury fish tissue concentration. attributable solely 
to utilities, of 0.03 mg/kg. The 90th percentile had 0.11 mg/kg, the 
99th percentile had 0.26 mg/kg, and the maximum individual sample point 
had 0.85 mg/kg.
    It should be recalled that EPA recommends the water quality 
criterion of 0.3 mg/kg as a level that, given fish consumption at the 
90th percentile level, would result in exposure levels below the RfD. 
For present purposes, EPA does not consider the water quality criterion 
of 0.3 mg/kg as a bright-line test for evaluating fish tissue 
methylmercury levels attributable to U.S. Utility Units. Rather, the 
criterion serves as establishing a broad frame of reference, that 
serves to place into context both the overall methylmercury fish tissue 
levels (which are attributable to methylmercury from all sources) and 
the methylmercury levels attributable to Utility Units.
    These results indicate the relatively small percentage of U.S. 
utility contribution to U.S. fish tissue methylmercury levels.
    b. 2020: Utilities With CAIR Reductions. EPA's modeling shows that 
in 2020, as a result of all international and U.S. emissions, and with 
U.S. utilities implementing reductions from CAIR (but not CAMR), the 
50th percentile of the sample points is projected to have a 
methylmercury fish tissue concentration of 0.21 mg/kg. The 90th 
percentile is projected to have 0.79 mg/kg, and the 99th percentile is 
projected to have 1.64 mg/kg.
    The amount of methylmercury in fish attributable solely to 
utilities in 2020, after implementation of the CAIR reductions (but, 
again, before CAMR), of course is smaller. The 50th percentile of the 
sample points is projected to have fish tissue concentration, 
attributable solely to utilities of 0.01 mg/kg. The 90th percentile is 
projected to have 0.03 mg/kg, the 99th percentile is projected to have 
0.10 mg/kg, and the maximum individual sample point (i.e., the one with 
the highest methylmercury levels) is projected to have 0.25 mg/kg.
    Again, using the 0.3 mg/kg methylmercury water quality criterion as 
a broad frame of reference serving to place in context both the overall 
methylmercury fish tissue levels (attributable to methylmercury from 
all sources) and the methylmercury fish tissue levels attributable to 
Utility Units, it is clear that the latter levels, following 
implementation of CAIR, are low.
    c. 2020: Utilities with CAMR Controls. The CAMR level of controls 
achieve further, albeit small, reductions in methylmercury fish tissue 
concentrations. Compared to the CAIR controls, the CAMR controls would 
further reduce, in 2020, methylmercury fish tissue concentrations by, 
in the 99th percentile, 0.01 mg/kg.
    d. 2020: Utilities with Alternative CAMR Controls. EPA evaluated, 
but did not adopt, a slightly tighter level of CAMR controls. These 
alternative

[[Page 16021]]

CAMR controls would have achieved still further, albeit, again small, 
reductions in Hg deposition and in fish tissue methylmercury levels. 
Compared to the CAIR controls, these alternative CAMR controls would 
reduce methylmercury fish tissue levels in 2020 by, in the 99th 
percentile, 0.02 mg/kg.\49\
---------------------------------------------------------------------------

    \49\ A detailed discussion of the control alternatives we 
considered and the reason for our final selection is contained in 
the preamble to the final CAMR.
---------------------------------------------------------------------------

5. Overall Impact of CAIR and CAMR Controls on Utility Unit Hg 
Emissions
    As described in the CAIR rule, CAIR reduces EGU Hg emissions from 
pre-CAIR levels by a substantial percentage. CAMR reduces Utility Unit 
Hg emissions, from CAIR levels, by 27 percent. CAMR reduces ionic Hg 
emissions, those that are most likely to result in local and regional 
deposition, by 17 percent relative to CAIR levels.
    These reductions tend to occur from the largest sources. That is, 
the larger the source of Hg emissions, the more likely it is to 
implement CAIR or CAMR controls, and therefore the more likely it is to 
reduce its Hg emissions. More specifically, under the cap-and-trade 
system, the marketplace tends to direct controls to the largest 
emitters because those emitters can achieve the most cost-effective 
reductions. Compared to smaller emitters, these larger emitters have an 
incentive to implement more stringent controls, thereby reducing their 
emissions further below the level of their allowances, and thereby 
generating a larger number of allowances for sale to defray control 
costs. See ``Proposed National Emissions Standards for Hazardous Air 
Pollutants; and in the Alternative, Proposed Standards of Performance 
for New and Existing Sources: Electric Utility Steam Generating 
Units,'' 9 FR 4652, 4702-03 (Jan. 30, 2004).
G. Exposure to Utility-Attributable Methylmercury Levels in Fish Tissue
    CAIR reduces median Utility-attributable fish tissue methylmercury 
levels, from pre-CAIR levels, by 67 percent. CAIR reduces the 99th 
percentile Utility-attributable fish tissue methylmercury levels, from 
pre-CAIR levels, by 60 percent. CAMR reduces median Utility-
attributable fish tissue methylmercury levels, from CAIR levels, by 12 
percent. CAMR reduces the 99th percentile Utility-attributable fish 
tissue methylmercury levels, from CAIR levels, by 9 percent.
    As a result of these reductions, after CAIR or CAMR, no sample site 
remains in which Utility-attributable, emissions cause methylmercury 
fish tissue levels to exceed 0.3 mg/kg (EPA's water quality criterion).
    Even with these reductions, although the levels of methylmercury in 
fish tissues attributable to Utility Units are small, the magnitude of 
methylmercury exposure depends on consumption levels and the 
sensitivity of the individual. For purposes of assessing whether 
utility Hg emissions are reasonably anticipated to result in hazards to 
public health, we focused on evaluating utility attributable 
methylmercury exposures for women of childbearing age in the general 
U.S. population who consume non-commercial (e.g., recreational) 
freshwater fish in U.S. waterbodies.
    This section describes available information as to the consumption 
levels of women of child-bearing age within the population of 
recreational fishers who consume at typical levels, and within high-
consumption sub-populations; and discusses the amounts of methylmercury 
that may be ingested as a result of those consumption levels.
1. General Population
    We believe that only those women of childbearing age who consume 
noncommercially caught U.S. freshwater fish have the potential for 
significant exposures to utility-attributable methylmercury. As a 
result, our assessment of the hazards to public health focuses on those 
women.
2. Recreational Fishers Who Consume Fish At Typical Levels.
    a. Consumption Levels. For our analysis of recreational freshwater 
fish consumption, EPA has determined that the sport-caught fish 
consumption rates for recreational freshwater fishers specified as 
``recommended'' in the EPA's Exposure Factors Handbook (mean of 8 gm/
day and 95th percentile of 25 gm/day), represent the most appropriate 
values for present purposes. These recommended values were derived 
based on ingestion rates from four studies conducted in Maine, 
Michigan, and Lake Ontario (Ebert et al., 1992; Connelly et al., 1996; 
West et al., 1989; West et al., 1993). These studies are suitable 
because they included information for annual-averaged daily intake 
rates for self-caught freshwater fish by all recreational fishers 
including consumers and non-consumers. The mean values presented in 
these four studies ranged from 5 to 17 gm/day, while the 95th 
percentile values ranged from 13 to 39 gm/day.\50\
---------------------------------------------------------------------------

    \50\ The 39 gm/day value actually represents a 96th percentile 
value.
---------------------------------------------------------------------------

    The EPA ``recommended values'' were developed by considering the 
range and spread of means and 95th percent values presented in the four 
studies. EPA recognizes that use of mean and 95th percentile 
consumption rates based on these four studies may not be representative 
of fishing behavior in every state and that there may be regional 
trends in consumption that differ from the values used in this 
analysis. However, EPA believes that these four studies represent the 
best available data for developing recreational fisher ingestion rates 
for present purposes.
    As a result, for today's purposes of evaluating the potential for 
health effects for consumers of recreational freshwater fish resulting 
from exposure to utility-attributable methylmercury, we consider both 
the mean of 8 gm/day consumption and the 95th percentile amount of 25 
gm/day.
    b. Levels of Consumption Combined with Levels of Utility-
Attributable Methylmercury in Fish Tissue. As described above, fish 
tissue levels of Utility-attributable methylmercury, for virtually all 
sample points, are only a fraction of the 0.3 mg/kg (fish tissue) water 
quality criterion. EPA evaluated recreational fish consumers' exposure 
to this Utility-Attributable methylmercury by calculating the level of 
exposure to this methylmercury and comparing it to the RfD when 
background exposures are not considered. For the purposes of assessing 
population exposure due solely to power plants, we create an index of 
daily intake (IDI).The IDI is defined as the ratio of exposure due 
solely to power plants to an exposure of 0.1 [mu]ug/kg bw/day. The IDI 
is defined so that an IDI of 1 is equal to an incremental exposure 
equal to the RfD level, recognizing that the RfD is an absolute level, 
while the IDI is based on incremental exposure without regard to 
absolute levels. Note that an IDI value of 1 would represent an 
absolute exposure greater than the RfD when background exposures are 
considered.
    At either the mean fish consumption rate of 8 gm/day or the 95th 
percentile fish consumption rate of 25 gm/day for recreational fish 
consumers discussed above, and using the 99th percentile methylmercury 
fish tissue concentration attributable to Utility Unit (and a typical 
body weight of 64 kg for women of child-bearing age), the calculated 
Utility-attributable methylmercury exposures are 0.013 [mu]ug/kg body 
weight per day and 0.04 [mu]ug/kg body weight per day, respectively. 
Both calculated exposures are well below the RfD of 0.1 [mu]ug/kg body 
weight per day (an IDI value well below 1).

[[Page 16022]]

    EPA uses the RfD to place ingestion levels in context. The RfD 
level of methylmercury ingestion--0.1 [mu]ug/kg body weight--should not 
be considered a bright line standard above which adverse health effects 
occur, but rather as an aid in establishing the context for evaluating 
both overall methylmercury ingestion (arising from methylmercury from 
all sources) as well as Utility-Attributable methylmercury ingestion in 
light of consumption rates. Our analysis concludes that Utility Unit Hg 
emissions do not cause hazards to the health of the general public or 
higher fish consuming recreational anglers.
3. High-Level Fish Consumption Sub-Populations
    Although exposure to Utility-attributable methylmercury from 
freshwater fish tissue is quite low for recreational fishers generally, 
as just described, EPA recognizes that certain sub-populations consume 
higher levels of U.S. freshwater fish. These populations may include a 
subset of recreational fishers who consume large quantities of fish, 
individuals who are subsistence fishers, and individuals who are part 
of certain ethnic groups. EPA is aware that at very high consumption 
levels, even relatively small concentrations of methylmercury in fish 
may result in exposures that exceed the RfD.
    However, as described in the TSD, characterization of fish 
consumption rates for the highest fish consuming subpopulations (e.g., 
Native American and other ethnic populations exhibiting subsistence-
like consumption) in the context of a larger regional or national 
analysis is technically challenging. Peer reviewed study data on these 
populations is relatively limited, especially when subjected to the 
criteria outlined in the TSD. Many of the high consumption groups that 
have been studied are located near the ocean and consequently have a 
significant fraction of their overall exposure comprised of saltwater 
fish. In addition, some of these studies provide details on seasonal 
consumption rates, but do not integrate these rates to provide an 
overall mean annual-averaged consumption rate relevant to an RfD-based 
analysis.
    Although many of these studies provide mean consumption rates, few 
have identified specific high-end percentile values (e.g., 90th, 95th 
or 99th percentile consumption rates). Instead, many studies, including 
a number of non-peer reviewed sources, cite non-specific high-end or 
bounding point estimates (e.g., the range of consumption rates for the 
Ojibwe submitted for the CAMR NODA). While these point values can be 
used in developing high-end bounding scenarios for evaluating risk to 
these groups, they do not support population-level analysis of exposure 
since they cannot be used to fit distributions characterizing 
variability in fish consumption rates across these sub-populations (as 
noted above, modeling of population-level exposures requires that 
distributions characterizing fish consumption rates across a particular 
population be developed).
    An additional challenge in characterizing high-level fish 
consumption is that care needs to be taken in extrapolating study 
results from one group to another. This reflects the fact that high-
level fish consumption is often tied to socio-cultural practices and 
consequently consumption rates for a study population cannot be easily 
transferred to other groups which may have different practices (e.g., 
practices for one Native American tribe may not be relevant to another 
and consequently behavior regarding fish consumption may not be 
generalized).
    Despite these challenges in characterizing high-level consumption, 
EPA has developed recommended subsistence-level fish consumption rates 
of 60 g/day (mean) and 170 g/day (95th percentile) (EPA, 1997, Exposure 
Factors Handbook). These values are based on a study of several Native 
American Tribes located along the Columbia River in Washington State. 
Although these consumption rates are specific to the tribes included in 
the study and reflect their particular socio-cultural practices 
(including seasonality and target fish species), EPA believes that this 
study does provide a reasonable characterization of high-consuming 
subsistence-like freshwater fishing behavior (EPA, 1997, Exposure 
Factors Handbook). Therefore, in the absence of data on local 
practices, EPA recommends that these consumption rates be used to model 
high-consuming groups in other locations. It is important to note that, 
as explained above, application of these subsistence consumption rates 
outside of the original Columbia River study area could be problematic 
because it would be difficult to transfer these consumption rates to a 
different group that might exhibit different fishing behavior. However, 
these recommended rates can be used to model subsistence scenarios at 
different locations.
    Although these subsistence consumption rates are recommended by 
EPA, commenters (including NODA comments obtained for this rule), have 
identified alternative consumption rates for specific high consuming 
groups that are in some instances, higher than these recommended 
values. For example, a survey by the Great Lakes Indian Fish and 
Wildlife Commission (GLIFWC) (as referenced in comments to the CAMR 
NODA) indicates that consumption rates by members of Ojibwe Great Lakes 
tribes during fall spearing season may range from 155.8-240.7 g/day and 
may range from 189.6-292.8 g/day during the spring. EPA has reviewed 
these comments and does not believe that it would be appropriate to 
rely on them for purposes this rulemaking. First, the data has not been 
peer reviewed. Moreover, it is not clear from the comments how many 
people consume fish at those rates, to what extent those fish consumers 
are women of child-bearing years, and how to annualize these seasonal 
sales.\51\
---------------------------------------------------------------------------

    \51\ As discussed below, the Ojibwe Great Lakes tribes do not 
appear to be located in areas with high utility-attributable Hg 
deposition.
---------------------------------------------------------------------------

    For all the above reasons, and despite comments indicating that 
some subgroups may have larger short-term consumption rates, EPA 
believes that the Columbia River-based consumption rates of between 60 
g/day (mean) and 170 g/day (95th percentile) are appropriate default 
values for subsistence fish consumers.

H. EPA Concludes That Utility Hg Emissions Remaining After Imposition 
of Other Requirements of the Act, in Particular CAA Sections 
110(a)(2)(D) and 111, Do Not Result in Hazards to Public Health

    As discussed above, Congress mandated that EPA assess hazards to 
public health reasonably anticipated to occur as a result of utility 
HAP emissions remaining after imposition of the requirements of the 
Act, and to regulate Utility Units under section 112 if EPA determines 
that such regulation is ``appropriate'' and ``necessary.'' The issue of 
whether the level of Hg emissions from Utility Units remaining after 
implementation of CAA section 110(a)(2)(D), and independently section 
111, cause hazards to public health is directly relevant to our 
conclusion set forth in section IV.A. above, namely, that it is not 
appropriate to regulate coal-fired Utility Units under section 112 on 
the basis of Hg emissions. For the reasons discussed below, EPA 
concludes that the level of Hg emissions remaining after implementation 
of CAIR, and, independently, CAMR, which implement sections 
110(a)(2)(D) and 111, respectively, do not result in hazards to public 
health.
    1. ``Hazards to Public Health'' Under Section 112(n)(1)(A)

[[Page 16023]]

    Section 112(n)(1)(A) establishes the backdrop against which our 
utility ``appropriate and necessary'' determination should be judged. 
Again, we must decide whether we reasonably anticipate utility Hg 
emissions remaining after imposition of the requirements of the Act to 
cause hazards to public health. If they do, then we must determine 
whether it is appropriate and necessary to regulate Utility Units under 
section 112. If utility Hg emissions do not cause public health 
hazards, however, which indeed is what we conclude today, then it is 
not appropriate to regulate such emissions under section 112, and there 
is no need to proceed to the ``necessary'' prong of the section 
112(n)(1)(A) inquiry, as explained above.
    Section 112(n)(1)(A) defines neither what constitutes a ``hazard'' 
to public health nor what EPA's obligations would be if such hazard 
were identified. Therefore, we believe that EPA has wide discretion, 
using its technical expertise, to define ``hazards to public health,'' 
and to determine whether Hg emissions from utilities pose such a 
hazard. EPA's judgment should only be overturned if it is deemed 
unreasonable, not merely because other, reasonable alternatives exist. 
Department of Treasury v. FLRA, 494 U.S. 922, 933 (1990); Texas Office 
of Public Utility Counsel v. FCC, 265 F.3d 313, 320 (5th Cir. 2001).
    Although section 112(n)(1)(A) does not define ``hazards to public 
health,'' section 112(n)(1)(C) offers guidance with respect to 
determining whether Hg emissions result in hazards to public health. In 
that section, Congress asked the National Institute of Environmental 
Health Sciences to conduct a study to determine the ``threshold level 
of mercury exposure below which adverse human health effects are not 
expected to occur.'' (Emphasis added) Congress further mandated that 
the study include a threshold for Hg concentrations in fish tissue 
which may be consumed, including consumption by ``sensitive 
populations'' without adverse effects on public health. Implicit in 
this direction, is that Congress was concerned, first about public 
health, not environmental effects. EPA has identified the exposure to 
Hg through consumption of contaminated fish as a pathway to human 
health effects, and EPA has also, in its discretion, looked at the 
health effects on sensitive populations.
    In interpreting what ``hazards to public health'' might be 
reasonably anticipated under section 112(n)(1)(A), we think it is also 
useful to look at the DC Circuit's Vinyl Chloride decision, 824 F.2d 
1146 (1987), and the analysis EPA articulated in its so-called 
``benzene'' analysis, 54 FR 38044 (Sept. 14, 1989). Although the Vinyl 
Chloride decision and ``benzene'' analysis address the issue of how to 
protect public health ``with an ample margin of safety,'' and are thus 
more stringent than the standard established in section 112(n)(1)(A), 
we nevertheless believe that the general principles articulated in 
Vinyl Chloride and the ``benzene'' analysis are relevant to our 
analysis of assessing hazards to public health pursuant to section 
112(n)(1)(A). Some of those key principles include: (1) ``Safe'' does 
not mean ``risk free,'' (Administrator is to determine what risks are 
acceptable in the world in which we live, where such activities as 
driving a car are considered generally safe notwithstanding the known 
risk involved), Vinyl Chloride, 824 F.2d at 1165; (2) something is `` 
`unsafe' only when it threatens humans with a significant risk of 
harm,' '' id. at 1153; (3) EPA, not the courts, has the technical 
expertise to determine what risks are acceptable, id. at 1163; (4) EPA 
is permitted to account for uncertainty and to use ``expert discretion 
to determine what action should be taken in light of that 
uncertainty,'' id.; and (5) in determining what is ``safe'' or 
``acceptable,'' EPA should consider a variety of factors, including: 
(a) Estimated risk to a maximally exposed individual (the so-called 
``maximum individual risk'' or ``MIR''); (b) overall incidence of 
cancer or other serious health effects within the exposed population; 
(c) the numbers of persons exposed within each individual lifetime risk 
range; (d) the science policy assumptions and uncertainties associated 
with the risk measures; (e) weight of the scientific evidence for human 
health effects; and (f) other quantified or unquantified health 
effects. (See 54 FR at 38045-46, 38057).
    In assessing whether remaining utility HAP emissions pose hazards 
to public health, consistent with section 112(n)(1)(C) and the above 
identified factors, we looked at the public's, including sensitive 
populations' (i.e., fish consumers), exposure to methylmercury through 
fish consumption attributable to utilities alone. Based on this 
assessment, and as explained further below, EPA concludes that 
remaining utility HAP emissions do not pose hazards to public health.
2. CAIR and CAMR Reduce the Public's Methylmercury Exposure Due to Fish 
Consumption to Below the Methylmercury RfD (Below an IDI Value of 1)
    As discussed above, EPA has adopted a water quality criterion for 
methylmercury for states to use in establishing water quality standards 
to protect public health. The criterion, expressed as a fish tissue 
concentration, of 0.3 mg/kg was derived from the methylmercury RfD 
(taking into account the possibility that a person may be exposed to 
methylmercury via commercial fish to some degree, as expressed in the 
RSC described elsewhere). At this level, people consuming at a high-end 
fish consumption rate of 17.5 grams per day would not be exposed above 
the methylmercury RfD. As noted above, this value represents the 90th 
percentile fish consumption rate.
    In the base year of 2001 (i.e., prior to both CAIR and CAMR), fish-
tissue methylmercury concentrations at the 90th percentile, 99th 
percentile, and maximum (that is, the single highest concentration) 
levels, attributable to utilities, are 0.11, 0.27, and 0.85 mg/kg, 
respectively. CAIR reduces the utility-attributable methylmercury fish-
tissue concentrations at the 90th percentile, 99th percentile, and 
maximum level to 0.03, 0.10, and 0.25 mg/kg, respectively. CAMR reduces 
these concentrations even further to 0.03, 0.09, and 0.19 mg/kg, 
respectively. These post CAIR and CAMR levels are considerably below 
the methylmercury water quality criterion of 0.3 mg/kg.
    At all of these post-control methylmercury levels, fish consumers 
at the water quality criterion 90th percentile consumption level of 
17.5 grams per day are well below the RfD (below an IDI value of 1). 
Further, these concentration values when applied to the 95th percentile 
consumption rate for recreational freshwater anglers identified in 
EPA's Exposure Factors Handbook, i.e., 25 grams per day, also result in 
exposures below the RfD (below an IDI value of 1). As a result, it is 
evident that the general population (which is expected to consume less 
U.S. freshwater fish than recreational anglers) does not confront 
hazards to public health from utility-attributable methylmercury.
    At the methylmercury fish tissue concentrations attributable to 
utilities remaining after implementation of CAIR and CAMR, it is 
possible that consumers eating at the subsistence-level fish 
consumption rates of 60 g/day (mean) and 170 g/day (95th percentile), 
see Exposure Factors Handbook, could exceed the RfD (an IDI value 
greater than 1) as a result of utility-attributable emissions if they 
are in fact consuming fish from the most contaminated locations. In 
other words, for a fish consumer to exceed the RfD (an IDI value 
greater than 1) as a result of utility

[[Page 16024]]

Hg emissions, they have to both (1) consume fish at the highest 
consumption rates and (2) consume fish from waterbodies with the 
highest levels of utility-attributable Hg fish-tissue concentrations. 
As discussed in the TSD, the probability of these factors converging is 
quite low. For example, after CAIR, the probability that a recreational 
angler will exceed the RfD (an IDI value greater than 1) exclusively as 
a result of utility Hg emissions is only 0.01 percent. After CAMR, the 
probability drops even lower. Our analysis further shows that even if 
there were a convergence of the unlikely factors of consuming at the 
99th percentile consumption rates and at the 99th percentile 
methylmecury fish tissue concentrations, exposure would exceed the RfD 
by only 10 percent (an IDI value of 1.1). Exceeding the RfD by this 
amount (an IDI value of 1.1) does not mean that an adverse effect will 
occur. Indeed, 10 percent above the RfD (an IDI value of 1.1), or 0.11 
[mu]g/kg-bw/day, is below the World Health Organization's level of 0.23 
[mu]g/kg-bw/day.\52\
---------------------------------------------------------------------------

    \52\ The choice of an ``acceptable'' risk level is one of policy 
informed by science. The RfD does not represent a ``bright line'' 
above which individuals are at risk of significant adverse effects. 
Rather, it reflects a level where EPA can state with reasonable 
certainty that risks are not appreciable. The Agency further notes 
that a number of other national and international scientific bodies 
have assessed the health effects of Hg and have adopted levels 
greater than EPA's RfD. As exposure levels increase beyond the RfD, 
the possibility of deleterious effects increases, but the point at 
which they become ``unacceptable'' must be determined on a case-by-
case basis. In making this determination, the Agency considers a 
number of factors including: (1) Confidence in the risk estimate: 
How certain is the scientific information supporting the link 
between possible health effects and exposures?; (2) the effects of 
concern: How serious are the health effects?; (3) the size of the 
population at risk, as well as the distribution of risk within the 
population. The Agency has considered these factors in the case of 
Hg and has concluded that the exposures above the IDI described 
elsewhere in this chapter do not constitute an unacceptable risk.
---------------------------------------------------------------------------

    Consumption rates for subsistence fishers are much higher than 
recreational anglers. As such, these populations have a greater 
probability of exceeding the RfD (an IDI value greater than 1). For 
this to happen, the subsistence fisher still must be at the high-end of 
the distribution for both consumption and utility-attributable 
methylmercury fish tissue concentrations. Our statistical data suggest 
that subsistence anglers at the 99th percentile consumption rate and 
the 99th percentile concentration level could exceed the RfD (an IDI 
value greater than 1). Holding consumption rates at the 99th 
percentile, the subsistence angler will likely exceed the RfD (an IDI 
value greater than 1) at or above the 72nd percentile fish tissue 
concentration.
    Again, the likelihood of this occurring is very small. Specific 
data on concentrations in fish at waterbodies frequented by subsistence 
fishing populations has not been generated. To get a sense of tribal 
location in relation to utility-attributable Hg deposition post-CAIR, 
we overlaid the 2000 Census data on the location of Native American 
populations (by census tract) on our CMAQ models. Visual inspection of 
the resulting map shows that the overwhelming majority of tribal 
populations live outside of areas most impacted by utility-attributable 
Hg deposition. See TSD. This suggests that the 99th percentile of the 
utility attributable methylmercury concentrations is likely 
inappropriate as an upper bound for Native American exposures, further 
reducing the probability that, post CAIR, and even more so, post CAMR, 
an individual Native American (who comprise a significant percent of 
upper-bound subsistence anglers) will exceed the RfD (an IDI value 
greater than 1).
    As discussed above, EPA received comments on the consumption rates 
of certain ethnic groups that are higher than the subsistence angler 
consumption rate that EPA relied on for purposes of this analysis. 
Specifically, members of the Ojibwe Great Lakes Tribes commented that 
during their fall spearing season they may consume between 156 and 241 
grams of fish per day, and during their spring spearing season, they 
may consume as much as 293 grams/day. For a number of reasons, EPA 
found the data to be of limited value. First, the data have not been 
peer reviewed and thus EPA is reluctant to rely on them for regulatory 
purposes. Second, commenters did not include information on annual 
average consumption rates or the percentage of those fish consumers 
that are women of childbearing age. Third, based on EPA's information, 
the Tribes do not reside in an area that appears to be significantly 
impacted by utility Hg emissions. Thus, despite having extremely high 
consumption rates, there are no data in the record that suggest that 
members of the Tribe would be exposed above the RfD (an IDI value 
greater than 1) as a result of utility emissions. And again, as 
discussed in greater detail below, exposure above the RfD does not 
necessarily equate to adverse effects.
3. The RfD Is An Appropriate Health Benchmark
    As described in section VII.B., in general, the RfD is ``an 
estimate (with uncertainty spanning perhaps an order of magnitude) of a 
daily exposure to the human population (including sensitive subgroups) 
that is likely to be without an appreciable risk of deleterious effects 
during a lifetime.'' \53\ EPA's RfD for Methylmercury is 0.1 [mu]g/kg 
bw/day, which is 0.1 microgram of Hg per day for each kilogram of a 
person's body weight. Since the most sensitive subpopulations are 
factored into the RfD, its use is thought to be protective of all life 
stages without additional uncertainty factors or adjustments. The 
National Academy of Sciences (NAS) reviewed the toxicological effects 
of Methylmercury and concluded that ``[o]n the basis of its evaluation, 
the committee's consensus is that the value of EPA's current RfD for 
Methylmercury, 0.1 [mu]g/kg per day, is a scientifically justifiable 
level for the protection of public health.'' \54\
---------------------------------------------------------------------------

    \53\ See http://www.epa.gov/iris/subst/0073.htm.
    \54\ See NAS at page 11 (emphasis added).
---------------------------------------------------------------------------

    EPA views the level of the RfD as establishing the overall context 
for assessing the health effects of ingesting utility-attributable 
Methylmercury. As noted above, in regulating HAPs that constitute 
threshold pollutants, EPA has stated that the risks associated with 
exposures below the RfD generally should be considered to be 
acceptable, and that the emissions associated with those exposures need 
not be regulated further under section 112.
    However, the RfD should not be considered a bright line. At 
exposures above the RfD, ``adverse health effects are possible,'' but 
such exposures ``[do] not necessarily mean that adverse effects will 
occur.'' Indeed, the World Health Organization has concluded that a 
level equal to 2.3 times EPA's Methylmercury RfD is protective of human 
health.
4. Risks Remaining After Implementation of CAIR, and Even More So After 
CAMR, Are Acceptable
    Applying the risk factors identified above to utility Hg emissions 
in the 112(n)(1)(A) context, EPA concludes that utility Hg emissions 
remaining after implementation of CAIR, and even more so after CAMR, do 
not pose unacceptable hazards to public health. The overwhelming 
majority of the general public and high-end fish consumers (at least 
through the 99th percentile of recreational anglers) are not expected 
to be exposed above the methylmercury RfD (an IDI value greater than 
1). While the possibility exists that a very small group of people may 
be exposed above the RfD (an IDI value greater than 1), significant 
uncertainties exist with respect to the existence and

[[Page 16025]]

actual size of such a group. There are also significant uncertainties 
concerning the extent to which such exposure might exceed the RfD (an 
IDI value greater than 1) and whether exposure at such levels would 
cause adverse effects. See TSD. EPA intends to continue to investigate 
the size and extent to which certain groups might be exposed above the 
RfD (an IDI value greater than 1), and reserves the right to revisit 
its risk acceptability determination if future information warrants.
    In the meantime, however, given the size of the population, 
including sensitive subpopulations, that after implementation of CAIR 
and, independently, CAMR, will be below the RfD (an IDI value of less 
than 1); the uncertainty of the size and the level to which certain 
groups may be exposed above the RfD (an IDI value greater than 1); the 
uncertainties that adverse effects will be experienced by such groups 
even at levels significantly above the methylmercury RfD (an IDI value 
greater than 1); and the nature of those potential adverse effects (see 
TSD), EPA, in its expert judgment, concludes that utility Hg emissions 
do not pose hazards to public health, and therefore that it is not 
appropriate to regulate such emissions under section 112.
5. Section 112(f) ``Residual Risk'' Analysis
    Some commenters have argued that, in determining whether utility 
HAPs pose a hazard to public health, EPA is bound to the mandates of 
section 112(f). In other words, some have argued that unless we can 
conclude that the imposition of the CAA requirements on utility HAP 
emissions ``provide[s] an ample margin of safety to protect public 
health,'' we must regulate utilities under section 112. We disagree. 
Section 112(n)(1)(A) governs our decision whether to regulate utilities 
under section 112, not 112(f). Had Congress intended us to apply the 
same standard, it could have used identical words to those found in 
section 112(f) or referenced it directly. It did not. Instead, Congress 
instructed EPA to assess whether utility HAP emissions cause ``hazards 
to public health.''
    Nevertheless, as explained above, in assessing whether remaining 
utility HAP emissions cause ``hazards to public health,'' EPA used 
essentially the same analysis that it would use in assessing the human 
health prong of a 112(f) determination.\55\ The factors laid out in the 
``benzene'' analysis for assessing acceptable risk to public health 
under 112(f) are generally relevant to assessing hazard under 
112(n)(1)(A). Thus, even if EPA were required to do a 112(f) analysis 
in determining whether utility Hg emissions pose public health hazards, 
it is very likely that the conclusion would have been the same, even if 
the methodology might have been slightly different.
---------------------------------------------------------------------------

    \55\ It should be noted that section 112(f) requires 
consideration of effects on the environment in addition to human 
health. In contrast, 112(n) requires a narrower assessment.
---------------------------------------------------------------------------

    As noted above, section 112(f) expressly incorporates EPA's pre-
1990 two-part inquiry for evaluating what level of emission reduction 
is needed to provide an ample margin of safety to protect public 
health. See CAA section 112(f)(2)(B) (incorporating EPA's two-part 
ample margin of safety inquiry, set forth at 54 FR 38044 (Sept. 14, 
1989), which implemented the requirements of section 112 of the 1977 
CAA). Under this approach, we must first determine what level is 
``acceptable'' based exclusively upon the Administrator's determination 
of the risk to health at a particular emission level. Vinyl Chloride, 
824 F.2d at 1164.\56\ The Court stressed, however, that ``safe'' in 
this context does not mean ``risk-free.'' Rather, the Agency must make 
a determination about what is safe ``based upon an expert judgment with 
regard to the level of emission that will result in an ``acceptable'' 
risk to health,'' taking into account the many every day activities 
that entail health risks but are not considered to be unsafe. Id. at 
1165.
---------------------------------------------------------------------------

    \56\ The Vinyl Chloride court did note, however, that under 
certain circumstances it might be appropriate to combine the two 
steps into one. Specifically, the court stated that ``[i]f the 
Administrator finds that some statistical methodology removes 
sufficiently the scientific uncertainty present in this case, then 
the Administrator could conceivably find that a certain 
statistically determined level of emissions will provide an ample 
margin of safety. If the Administrator uses this methodology, he 
cannot consider cost and technological feasibility: these factors 
are no longer relevant because the Administrator has found another 
method to provide an `ample margin' of safety.'' 824 F.2d at 1165, 
fn 11.
---------------------------------------------------------------------------

    In this regard, we also note that section 112(f) makes a 
distinction between pollutants classified as ``known, probable or 
possible carcinogens'' and other hazardous air pollutants such as Hg. 
For possible carcinogens, the Agency must set a residual risk standard 
if ``the individual most exposed to emissions from a source'' is 
subject to a risk above a certain level. This additional requirement 
does not apply to other hazardous air pollutants. Therefore, in 
determining whether any level of Hg emission is `acceptable' under 
112(f), we would use the same basic approach we have used in this case. 
Although we would evaluate the risk to the maximum exposed individual, 
which we essentially did for purposes of assessing the hazards posed by 
utility emissions under section 112(n)(1)(A), we believe that ``the 
distribution of risks in the exposed population, incidence, the science 
policy assumption and uncertainties associated with the risk measures, 
and the weight of evidence that a pollutant is harmful to health are 
[also] important factors to be considered'' in making a decision as to 
whether a given level of emissions is acceptable. 54 FR at 38044.
    Then, ``[i]n the ample margin decision [the second step], the 
Agency again considers all of the health risk and other health 
information considered in the first step. Beyond that information, 
additional factors relating to the appropriate level of control will 
also be considered, including costs and economic impacts of controls, 
technological feasibility, uncertainties, and any other relevant 
factors.'' 54 FR 38046.
    As explained in section H.3. above, applying the general principles 
articulated in the Vinyl Chloride decision and the benzene rule, the 
Agency has concluded that power plant Hg emissions remaining after 
CAIR, and even more so after CAMR, do not pose hazards to public 
health. This determination was based on health considerations alone, as 
would be the case under the first step of a 112(f) analysis. Under the 
second step of a 112(f) analysis, we would then consider both the 
benefits and costs of further emission reductions. Based on what we 
know about the uncertainties and nature of the potential adverse 
effects associated with Hg exposure, the extent to which the public, 
including sensitive subpopulations, is exposed to Hg, and the extent to 
which such exposure could be reduced by further reducing Hg emissions 
from U.S. power plants, we have concluded that the cost of requiring 
further reductions in Hg emissions from power plants would 
significantly outweigh any benefits. Therefore, if we were proceeding 
under section 112(f), we would likely conclude that CAIR, and even more 
so CAMR, not only protects public health, but does so with an ``ample 
margin of safety.''

I. The Final CAMR Will Not Lead to Localized ``Utility Hot Spots''

1. What Is a ``Utility Hot Spot''?
    As we said in the preamble to the proposed rule, Hg emissions from 
power plants sometimes are deposited locally near the plant (i.e., 
within 25 km),

[[Page 16026]]

specifically emissions of oxidized and particulate Hg. Nearby 
waterbodies may be a source of fish consumption for recreational and/or 
subsistence fishers, and thus local Hg deposition in nearby waterbodies 
could be a source of what some refer to as ``hot spots.'' In the 
proposed rule, we suggested that a ``power plant may lead to a hot spot 
if the contribution of the plant's emissions of Hg to local deposition 
is sufficient to cause blood Hg levels of highly exposed individuals 
near the plant to exceed the RfD.'' (See 69 FR 4702.)
    Based on additional analysis and consideration of the ``hot spot'' 
issue and to ensure that stakeholders have a common understanding of 
how EPA uses the term, we define a ``utility hot spot'' as ``a 
waterbody that is a source of consumable fish with Methylmercury tissue 
concentrations, attributable solely to utilities, greater than the 
EPA's Methylmercury water quality criterion of 0.3 mg/kg.'' We believe 
that the water quality criterion is an appropriate indicator of a ``hot 
spot,'' given that the Methylmercury exposure pathway of greatest 
concern is fish consumption and that the water quality criterion was 
back calculated from the Methylmercury RfD using a high-end fish 
consumption rate.
2. EPA Does Not Believe That There Will Be Any Hot Spots After 
Implementation of CAIR and CAMR
    As explained elsewhere in this preamble and in the TSD, for 
purposes of today's notice, EPA modeled utility Hg deposition, before 
and after implementation of CAIR and CAMR, using the Community Multi-
Scale Air Quality (``CMAQ'') model, a three-dimensional eulerian grid 
model. CMAQ is the most sophisticated Hg dispersion model in existence. 
It uses a ``one-atmosphere'' approach and addresses the complex 
physical and chemical interactions known to occur among multiple 
pollutants in the free atmosphere.\57\ The spatial resolution (i.e., 
the ability to observe concentration or depositional gradients/
differences) of the gridded output information from CMAQ for purposes 
of this analysis is 36 km.
---------------------------------------------------------------------------

    \57\ In simulating the transport, transformation, and deposition 
of pollutants, CMAQ resolves 14 vertical layers in the atmosphere, 
and employs finer-scale resolution near the surface of the boundary 
layer to simulate deposition to both terrestrial and aquatic 
ecosystems. CMAQ atmospheric transport is defined using a higher-
order meteorological model, commonly the Fifth-Generation 
Pennsylvania State University/National Center for Atmospheric 
Research mesoscale model (MMM5).
---------------------------------------------------------------------------

    We believe that this an appropriate scale given the exposure 
pathway. First, because much of the Hg deposited on the watershed of 
different ecosystems will eventually enter waterbodies through 
subsurface inflow and runoff, we consider a watershed scale analysis to 
be more appropriate than finer scale resolution that may only describe 
direct inputs to surface waters. Second, in larger waterbodies (i.e., 
the Great Lakes) where there is substantial fishing activity, the 
higher trophic level fish species consumed by humans are likely 
migratory and the accumulation of Hg by these species will represent an 
aggregated signal from deposition over a wider area (e.g., the entire 
waterbody within a watershed.) Since we are concerned about the 
cumulative dose over weeks and months from repetitive consumption of 
fish containing methylmercury, this fishing behavior should be 
considered in the exposure pathway. Based on the above considerations, 
we conclude that the HUC-8 watershed is the appropriate unit of measure 
for analysis. While this analysis covers the vast majority of the U.S. 
population that may be exposed to emissions from U.S. power plants, we 
acknowledge that there are inherent uncertainties at the extreme tails 
of the exposure distribution. We continue to advance the state of the 
science and the associated models to better understand the tail of this 
exposure distribution.
    As discussed in section VII.D. of today's notice, EPA used fish 
tissue data from the National Listing of Fish and Wildlife Advisories 
and the National Fish Tissue Survey to determine Methylmercury fish 
tissue concentrations for numerous sample sites throughout the country. 
We then used CMAQ to determine the amount of utility Hg deposition, in 
conjunction with Mercury Maps (which associates an increment of change 
in Hg deposition with an equal change in Methylmercury fish tissue 
concentrations) to predict what fish concentrations at those sample 
sites would be after implementation of CAIR and CAMR. As discussed in 
section VII.E., those analyses conclude that none of the sample sites 
will exceed, as a result of utility emissions, the water quality 
criterion of 0.3 mg/kg. In fact, our analysis shows that fish tissue 
Methylmercury concentrations attributable to utility Hg emissions will 
be significantly below the water quality criterion. By 2020, after 
CAIR, levels at the 50th, 90th, 99th percentiles and maximum value 
sample site are predicted to be 0.01, 0.03, 0.10, and 0.25 mg/kg, 
respectively. After CAMR, levels at the 50th, 90th, 99th percentiles 
and maximum value sample site are predicted to be 0.01, 0.03, 0.09, and 
0.19 mg/kg, respectively. Therefore, based on the information available 
to us at this time, our analyses indicate utility Hg emissions, after 
implementation of either CAIR or CAMR, will not result in ``hot 
spots.''
    EPA conducted a similar analysis in its 1998 Utility Report to 
Congress (``Utility Study'') using the Industrial Source Complex 
Version 3 (``ISC3'') model. (See TSD) EPA analyzed four model plants 
representing four utility boilers: Large coal-fired, medium coal-fired, 
small coal-fired, and medium oil-fired. Each of these plants was also 
modeled at two generic sites: A humid site east of the 90 degrees west 
longitude, and a more arid site west of the 90 degree west longitude. 
(See Utility Study at 7-29). Hg deposition was modeled at a 
hypothetical lake located at three distances for each model site: 2.5, 
10, and 25 km. The results of that analysis showed that under only one 
modeled scenario was the Methylmercury water quality criterion 
exceeded. Specifically, the model predicted that a hypothetical lake 
located 2.5 km from a large eastern coal-fired utility would experience 
Methylmercury fish tissue concentration of 0.43 mg/kg. None of the 
other 23 model facilities/lake combinations exceeded the water 
criterion. (See Utility Study at 7-37).
    For a number of reasons more fully explained in our TSD, even 
though only one facility/lake combination exceeded the water quality 
criterion, we believe that the analysis done for the 1998 Utility Study 
was conservative and, hence, over predicted near-field Hg deposition 
and corresponding fish tissue concentrations in almost all situations. 
That analysis was a screening analysis and thus was conservative by 
design. For example, it did not incorporate a sophisticated treatment 
of the atmospheric chemistry and phase-transition behavior of Hg, as we 
have included in our CMAQ analysis, and our understanding of wet and 
dry deposition processes for Hg has improved significantly since then. 
As a result, we judge that the CMAQ model results represent a more 
accurate representation of near-field Hg impacts than can be obtained 
using the ISC3 modeling approach. See the discussion above about why 
the CMAQ model appropriately represents near-field deposition.
    There are other factors that lead EPA to conclude that the Utility 
Study analysis overstated fish-tissue methylmercury concentrations in 
most situations. Based on the BAFs considered, the hypothetical 
ecosystem described in the RTC is more sensitive

[[Page 16027]]

than three out of four ecosystems chosen for the case studies (see 
Table 4-6, page 25 of Ecosystem Scale Modeling for Mercury Benefits 
Analysis) and is less sensitive than one (Lake Barco). Comparing these 
case studies to empirically derived BAFs characterized by the Office of 
Water indicates that modeled fish tissue responses in three of four 
case studies had empirically derived BAFs that fell between the 5th and 
50th percentiles of the geometric mean of field-measured BAFs for 
trophic level 4 species obtained from the published literature (EPA 
2000). The model ecosystem described in the RTC fell between the 50th 
and 95th percentile for BAFs, and one of the case studies (Lake Barco) 
exceeded the 95th percentile.
    Some limitations to the BAF approach deserve mention. Because 
Methylmercury concentrations in the water column are highly variable, 
empirically-derived BAFs are inherently underdetermined and have 
limited predictive power. A more credible approach based on our current 
knowledge is to forecast changes in fish Hg concentrations using 
information on the food-web dynamics (``bioenergetics'') of different 
ecosystems. Such a model (BASS) was applied in one of the case studies 
described in Chapter 3 of the RIA for CAMR, and showed that while the 
BAFs calculated from the outputs of the bioenergetics-based 
bioaccumulation model were within a factor of 2 of the empirically 
derived BAF used in the SERAFM model, the empirically derived fish Hg 
concentrations were more conservative than the BASS model for this one 
ecosystem. (See TSD). Thus, the above information suggests that our RTC 
analysis may have over predicted fish-tissue methylmercury 
concentrations in many ecosystems that could be impacted by Hg 
deposition from U.S. power plants. However, it is important to note 
that fish tissue methylmercury concentrations due to power plants may 
be higher in some ecosystems (for example, ecosystems similar to Lake 
Barco described in Ch. 3 of the CAMR RIA).
    For all the above described reasons, we think our current modeling 
approach as described in the TSD provides for a more advanced, state-
of-the-science assessment of the atmospheric fate, transport, 
deposition, and cycling of Hg through the environment than the modeling 
approach used in the Utility Study. For these reasons, we have no 
evidence that utility Hg emissions after CAIR (and even more so after 
CAMR) will result in hot spots.
    Based on our experience with the Title IV acid rain program and our 
modeling using IPM, we believe that the cap-and-trade approaches 
adopted under CAIR and CAMR will reduce Hg exposure in most areas and 
create strong economic incentives for the reduction of Hg emissions in 
the future.
    First, modeling runs suggest that large coal-fired utilities 
contribute more to local Hg deposition than medium-sized and smaller 
coal-fired utilities.\58\ However, under a cap-and-trade system, large 
utilities are more likely to over-control their emissions and sell 
resulting emission allowances than smaller utilities, which are less 
likely to be the source of a local hot spot. Under basic utility 
economics of capital investment, when capital is limited, up-front 
capital costs of control equipment are significant, and where emission-
removal effectiveness (measured in percentage of removal) is unrelated 
to plant size, it makes more economic sense for a company to allocate 
pollution-prevention capital to its larger facilities where more 
allowances can be earned, than to its smaller ones. In other words, we 
would expect economies of scale of pollution control investment to be 
made at larger plants. Moreover, newer plants tend to be larger. Since 
newer plants have longer expected lifetimes, providing a longer return 
on investment, we would expect this to be an incentive for these larger 
facilities to choose to control and sell credits.
---------------------------------------------------------------------------

    \58\ Indeed, the one model utility in the Utility Study analysis 
that exceeded the water quality criterion at a hypothetical lake 
within 2.5 km was an eastern large coal-fired utility. Given the 
tendencies for larger facilities to control under a cap-and-trade 
system, we do not anticipate that larger plants will cause localized 
hot spots.
---------------------------------------------------------------------------

    Indeed, as part of its analysis of the President's 2003 Clear Skies 
initiative, EPA analyzed Hg emissions reductions under a cap-and-trade 
mechanism. In the Clear Skies example, the greatest emissions 
reductions were projected to occur at the electric generating sources 
with the highest Hg emissions. This pattern is similar to that observed 
in the SO2 emissions trading program under the Acid Rain 
Program. Under Clear Skies, compared to a base case of existing 
programs, Hg 2+ emissions (which tend to be 
deposited locally, i.e., within 25 kilometers) from power plants 
located up to 10 kilometers from a water body were projected to 
decrease by over 60 percent by 2020.
    Second, the types of Hg that are deposited locally--Hg 
2+ and Hgp--are controlled by the same 
equipment that controls PM, SO2, and NOX. Thus, 
as utilities invest in equipment to comply with EPA's new PM and ozone 
standards (e.g., the CAIR rule that was signed on March 10, 2005 and 
new State Implementation Plans (SIPs) for PM and ozone), the Agency 
expects ``co-benefit'' Hg reductions.
    Moreover, EPA's IPM modeling for today's action predicts that 
larger emitters generally are expected to reduce the most, as was our 
experience with the Acid Rain Program. Through our CMAQ modeling, we 
further predict utility-attributable deposition reductions in areas 
where hotspots would otherwise potentially occur. As described in 
section VII.E., the median deposition level is reduced by only 8 
percent when utilities emissions are zeroed out in 2001, but in areas 
with the highest deposition levels, zeroing out utilities reduces the 
99th percentile deposition level by 15 percent. After implementation of 
CAIR in 2020, areas with high levels of utility deposition receive a 
larger reduction in utility-attributable Hg deposition relative to 
areas with a relatively small level of utility-attributable deposition.
    For all these reasons, we do not anticipate that our final CAMR 
rule will result in local Hg hot spots; to the contrary, we anticipate 
that our cap-and-trade CAMR will actually eliminate hot spots that may 
have previously existed.
    In addition to reductions required by the CAIR and CAMR caps, 
states have the authority to address local health-based concerns 
separate from these programs. Although more stringent state regulations 
would reduce the flexibility of a cap-and-trade system, states 
nevertheless have such authority.
3. Continued Evaluation of Utility Hg Emissions
    For all the reasons discussed above and elsewhere in this preamble, 
EPA does not believe that CAIR or CAMR will result in utility-
attributable hot spots. That said, we recognize that even our state-of-
the-art models and inputs have certain limitations that make it 
impossible for us to definitively conclude that there are no 
circumstances under which a hot spot could result even after full 
implementation of CAIR and CAMR. However, in order for a hot spot to 
occur, there would have to be an alignment of key environmental 
factors, such as meteorology, deposition, and ecosystem processes in 
conjunction with a large uncontrolled near-field utility unit or a 
collection of such units. The likelihood of these factors converging is 
remote. Nevertheless, we intend to monitor this situation closely and 
continue to advance the state of the science of Hg transport and fate. 
In that

[[Page 16028]]

regard, if we receive new information that raises the possibility of 
utility-attributable hotspots, we will evaluate the situation and take 
appropriate action.
    We believe that we have the authority under the Act to address 
future hotspots appropriately. Indeed, today we have identified other 
authorities under the CAA through which we can obtain Hg reductions 
from coal-fired Utility Units--either by regulating Hg directly, or 
indirectly as the result of co-benefits. The 1998 Utility Study also 
identifies other requirements of the Act with which Utility Units must 
comply that can result in HAP reductions, including Hg. Because we do 
not currently have any facts before us that would lead us to conclude 
that utility-attributable hotspots exist, we do not at this time reach 
any conclusion as to which statutory authority we would use to address 
such a fact-specific situation because it necessarily depends on the 
facts.
    For example, if in the future we determine that utility-
attributable hotspots exist and that those hotspots occur as the result 
of Hg emissions from coal-fired Utility Units, we may promulgate a 
tighter section 111 standard of performance, provided we determine the 
technology can achieve the contemplated reductions. We could revise the 
standard of performance by adjusting the cap-and-trade program to limit 
trading by high-emitting Utility Units. As the DC Circuit has 
recognized, we have discretion to weigh the statutory factors 
identified in section 111(a), which include cost, in setting a standard 
of performance. Lignite Energy Council v. EPA, 198 F.3d 930 (DC Cir. 
1999). We therefore believe that under section 111, we can evaluate the 
cost of emission reduction in the context of the identified hotspots, 
and we may reasonably conclude that the additional cost of a more 
stringent standard is appropriate in light of the health concern 
associated with the hotspots. Alternatively, we may in the future 
identify utility-attributable hotspots and determine that such hotspots 
can be addressed by virtue of Hg co-benefits control achieved through 
the promulgation of other requirements. Thus, although we cannot 
conclude today which statutory authority we would implement to address 
utility-attributable hotspots because that determination necessarily 
hinges on the facts associated with the identified hotspots, we do 
conclude that were such a situation to occur, we believe that EPA has 
adequate authority to address any such situation that may arise in the 
future.

J. The Global Pool of Hg Emissions

1. Background
    As explained above, Hg is emitted into the environment in different 
ways. About one-third of the Hg in the atmosphere is from human-caused 
activities (``anthropogenic''), one-third is from natural processes 
(such as volcanic eruption, groundwater seepage and evaporation from 
the oceans), and one-third constitutes re-emitted emissions, which is 
Hg from human-caused activities or natural processes that is emitted 
into the atmosphere, deposited and then re-emitted into the atmosphere. 
United States anthropogenic Hg emissions are estimated to account for 
about three percent of the global pool of Hg emissions, and United 
States (``domestic'') utilities are estimated to account for about one 
percent of that total global pool. See Utility Study at 7-1 to 7-2, 69 
FR at 4657-58 (January 20, 2004). The global pool therefore includes 
all human-caused activities that occur both within the United States 
and abroad, all emissions that result from natural processes anywhere 
in the world, and re-emitted Hg.
    To place the Hg emissions from domestic Utility Units in context, 
EPA modeled different scenarios that analyze the effect of domestic 
utility Hg emissions in the context of the global pool. We describe 
that modeling in detail above.
    Our modeling shows that in virtually all instances, the utility-
attributable methylmercury levels are a very small fraction of the 
overall methylmercury levels. For 16 percent of the modeled sites, 
overall levels of methylmercury in fish tissue in 2020 are projected to 
be above the 0.3 mg/kg water quality criterion. At the 90th percentile, 
in 2020, after implementation of CAIR, overall levels are projected at 
0.79 mg/kg, and at the 99th percentile, at 1.64. The greatest fraction 
of these methylmercury levels are attributable to non-air sources, 
including mines and chloralkali plants, and uncontrollable air sources, 
including international emissions from industrial and utility sources. 
In virtually all of these instances, the Utility-attributable 
methylmercury levels are a very small fraction of the overall 
methylmercury levels. For the highest 10 percent of utility-
attributable methylmercury fish tissue levels, utility-attributable 
methylmercury accounted for a maximum of 9 percent of total 
methylmercury concentrations, and an average of only 4 percent. 
Clearly, even at locations with high levels of utility Hg deposition, 
other sources of Hg contribute most of the methylmercury.
2. Even Examining Utility Hg Emissions in the Context of the Global 
Pool, We Cannot Conclude That It Is Appropriate to Regulate Coal-Fired 
Utility Units Under CAA Section 112
    Our conclusions in sections VI.J and VI.K above are based solely on 
our analysis of Hg emissions from coal-fired Utility Units. See 
generally 65 FR 79,826-29 (explaining that Hg from coal-fired units is 
the HAP of greatest concern); Utility Study, ES-27 (same). We focused 
our analysis in this regard because EPA has interpreted section 
112(n)(1)(A) to examine the hazards to public health that are ``a 
result of'' Utility Units. See CAA section 112(n)(1)(A). As explained 
in section III above, the focus in section 112(n)(1)(A) on emissions 
``result[ing]'' from Utility Units is significant, particularly when 
contrasted against other provisions of the Act, such as section 
110(a)(2)(D). In section 110(a)(2)(D), Congress sought to regulate any 
air pollutant that will ``contribute to'' nonattainment. Thus, under 
section 110(a)(2)(D), we can regulate a pollutant if it ``contributes'' 
to a nonattainment problem, but does not itself cause the problem. EPA 
has concluded that section 112(n)(1)(A) is different, where Congress 
directed EPA to study the hazards to public health ``reasonably 
anticipated to occur as a result of emissions of'' Utility Units. 
(emphasis added)
    Moreover, Congress' focus on the hazards to public health resulting 
from Utility Units may reflect Congress' recognition of the unique 
situation posed by Hg, which is that Hg emissions from domestic 
utilities represent less than one percent of the global pool. Indeed, 
Congress specifically addressed Hg in other provisions of section 
112(n). For example, under section 112(n)(1)(B), Congress required EPA 
to complete a study addressing Hg emissions from Utility Units and 
other sources of Hg. See CAA section 112(n)(1)(B); see also CAA Section 
112(n)(1)(C) (requiring National Institute of Environmental Health 
Sciences to determine the threshold level of Hg exposure below which 
adverse human health effects are not expected to occur).
    Nevertheless, even were we to examine hazards to public health on a 
broader scale by focusing on the global Hg pool, our conclusion 
(discussed above in Section IV.A.) that it is not appropriate to 
regulate coal-fired Utility Units under section 112 on the basis of Hg 
emissions would be the same. Our analyses in support of that conclusion 
would differ, however, because we

[[Page 16029]]

would be assessing whether it is appropriate to regulate Utility Units 
under section 112 by reference to a different level of Hg emissions. As 
explained in section III of this notice, we have discretion, in 
determining whether regulation under section 112 is appropriate, to 
consider other factors and, in particular, any unique facts and 
circumstances associated with the HAP emissions at issue. Here, the 
unique circumstance is that domestic Utility Units represent only one 
percent of the global pool. Our modeling shows that were we to prohibit 
all Hg emissions from domestic utilities in this country, such 
regulation would result in only a very small improvement in 
methylmercury levels in the waterbodies that exceed the methylmercury 
water quality criteria. Therefore, precluding all Hg emissions from 
coal-fired powerplants would, in effect, force such plants out of 
business, yet reduce virtually none of the risks to public health 
stemming from the global Hg pool.
    In these circumstances, we find that it is not appropriate to 
regulate coal-fired Utility Units under section 112 on the basis of the 
global Hg pool because the health benefits associated with such 
regulation would be nominal and the costs extreme. It is also not 
appropriate to regulate Hg emissions from coal-fired utility units 
remaining after imposition of the requirements of the Act because the 
global sources contributing most significantly to the remaining public 
health hazards are not domestic utilities and the sole question before 
us under section 112(n)(1)(A) is whether it is appropriate to regulate 
Utility Units under section 112 of the Act.\59\
---------------------------------------------------------------------------

    \59\ See 36 Cong. Rec. S16895, S16899 (daily ed. Oct. 27, 1990) 
(Statement of Senator Burdick, member of the Conference Committee 
and Chairman of the Committee on Environment and Public Works) 
(``Under section 112(n) utility emissions are exempt from air toxics 
regulation until studies are completed and the Administrator 
determines, based on the studies, that air toxics regulation is 
warranted. The hazardous substance of greatest concern here is Hg. 
The Senate bill required Hg reductions from coal-fired units. The 
Senate provision could not be sustained by the scientific facts. 
What little is known of Hg movement in the biosphere, suggests that 
its long residence time makes it a long-range transport problem of 
international or worldwide dimensions. Thus, a full control program 
in the United States requiring dry scrubbers and baghouses to 
control Hg emissions from coal-fired power plants would double the 
costs of acid rain control with no expectation of perceptible 
improvement in public health in the United States. I am pleased the 
conferees adopted the House provision on hazardous air pollutants 
with respect to Utility Units.'')
---------------------------------------------------------------------------

K. Further Study

    The behavior of Hg in the atmosphere and in aquatic systems, and 
the human health effects of Hg are areas of much interest and activity 
within the scientific and health research communities. In addition, our 
ability to quantify and value the effects that changes in Hg releases 
may have to human health is continuing to evolve. Furthermore, 
technologies and techniques for limiting Hg emissions from power plants 
are also rapidly advancing. EPA will continue to monitor developments 
in all these areas, as well as continuing its own efforts to advance 
the state of the science. One of the benefits of today's approach is 
that it provides a flexible structure that could be modified to 
accommodate new information should it become available.

VII. EPA'S Authority to Regulate HAP From Utility Units Under CAA 
Section 111

    As explained in sections IV and VI above, we conclude today, among 
other things, that EPA's December 2000 appropriate and necessary 
finding lacked foundation because it failed to consider the HAP 
reductions that could be obtained through implementation of section 
111, and therefore whether it was ``necessary'' to regulate under 
section 112. We decide today that it is not ``necessary'' to regulate 
utility HAPs under section 112, in particular because of our 
authorities to effectively reduce utility HAPs under CAA sections 
110(a)(2)(D) and 111.\60\
    We describe below the regulatory scheme under section 111 and EPA's 
authority to regulate HAP emissions under that section. We also 
describe the recently issued Clean Air Mercury Rule (``CAMR''), which 
implements CAA section 111. Finally, we demonstrate that the CAMR rule, 
once implemented, will result in levels of Hg emissions from coal-fired 
Utility Units that pose no hazards to public health.
---------------------------------------------------------------------------

    \60\ We also conclude today, as discussed in detail above, that 
Hg emissions from coal-fired Utility Units remaining after 
implementation of section 110(a)(2)(D) do not result in hazards to 
public health. See Sections V and VI. Section 111, which is the 
focus of this section of the preamble, constitutes an independent 
basis for our actions today, because that provision, once 
implemented, will effectively address any Hg emissions from coal-
fired Utility Units, and for that reason, Hg emissions from coal-
fired Utility Units that remain ``after imposition of the 
requirements of th[e] Act do not result in hazards to public 
health.'' CAA Section 112(n)(1)(A).
---------------------------------------------------------------------------

A. Overview of the Requirements of Section 111

    CAA section 111 creates a program for the establishment of 
``standards of performance.'' A ``standard of performance'' is ``a 
standard for emissions of air pollutants which reflects the degree of 
emission limitation achievable through the application of the best 
system of emission reduction, which (taking into account the cost of 
achieving such reduction, any nonair quality health and environmental 
impacts and energy requirements), the Administrator determines has been 
adequately demonstrated.'' CAA section 111(a)(1).
    For new sources, EPA must first establish a list of stationary 
source categories, which, the Administrator has determined ``causes, or 
contributes significantly to, air pollution which may reasonably be 
anticipated to endanger public health or welfare.'' CAA section 
111(b)(1)(A)). EPA must then set federal standards of performance for 
new sources within each listed source category. (CAA section 
111(b)(1)(B)). Like section 112(d) standards, the standards for new 
sources under section 111(b) apply nationally and are effective upon 
promulgation. (CAA section 111(b)(1)(B)).
    Existing sources are addressed under section 111(d) of the CAA. EPA 
can issue standards of performance for existing sources in a source 
category only if it has established standards of performance for new 
sources in that same category under section 111(b), and only for 
certain pollutants. (CAA section 111(d)(1)). Section 111(d) authorizes 
EPA to promulgate standards of performance that states must adopt 
through a SIP-like process, which requires state rulemaking action 
followed by review and approval of state plans by EPA. If a state fails 
to submit a satisfactory plan, EPA has the authority to prescribe a 
plan for the state. (CAA section 111(d)(2)(A)).

B. EPA's Authority to Regulate HAP Under Section 111

    Section 111(b) covers any category of sources that causes or 
contributes to air pollution that may reasonably be anticipated to 
endanger public health or welfare and provides EPA authority to 
regulate new sources of such air pollution. EPA included Utility Units 
on the section 111(b) list of stationary sources in 1979 and has issued 
final standards of performance for new Utility Units for pollutants, 
such as NOX, PM, and SO2. See 44 FR 33580; June 
11, 1979; Subpart Da of 40 CFR Part 60. Nothing in the language of 
section 111(b) precludes EPA from issuing additional standards of 
performance for other pollutants, including HAP, emitted from new 
Utility Units. Moreover, nothing in section 112(n)(1)(A) suggests that 
Congress sought to preclude EPA from regulating Utility Units under 
section 111(b). Indeed, section 112(n)(1)(A)

[[Page 16030]]

provides to the contrary, in that it calls for an analysis of utility 
HAP emissions ``after imposition of the requirements of th[e] Act,'' 
which we have reasonably interpreted to mean those authorities that EPA 
reasonably anticipated at the time of the Study would have reduced 
utility HAP emissions.
    EPA received numerous comments concerning its authority under 
section 111 to regulate HAP from Utility Units. Those comments focused 
largely on EPA's authority to regulate existing units under section 
111(d). As explained below, EPA has reasonably interpreted section 
111(d) as providing authority to regulate HAP from existing Utility 
Units.
    Unlike section 111(b), section 111(d) specifically references CAA 
section 112. The import of that reference is not clear on the face of 
Public Law 101-549, which is the 1990 amendments to the CAA, because 
the House and Senate each enacted a different amendment to section 
111(d). The Conference Committee never resolved the differences between 
the two amendments and both were enacted into law as part of section 
111(d). EPA is therefore confronted with the highly unusual situation 
of an enacted bill signed by the President that contains two different 
and inconsistent amendments to the same statutory provision.
1. Overview of the Two Amendments in Section 111(d)
    An important starting point for evaluating the two amendments to 
section 111(d) in 1990 is the 1977 Act. Section 111(d) of the 1977 CAA 
provides, in pertinent part:

    The Administrator shall prescribe regulations which shall 
establish a procedure similar to that provided by section 7410 of 
this title under which each State shall submit to the Administrator 
a plan which (A) establishes standards of performance for any 
existing source for any air pollutant (i) for which air quality 
criteria have not been issued or which is not included on a list 
published under section 7408(a) or 7412(b)(1)(A) of this title, but 
(ii) to which a standard of performance under this section would 
apply if such existing source were a new source. * * *

42 U.S.C.A. 7411(d) (West 1977); Public Law 95-95. The above language 
provides that standards of performance under section 111(d) cannot be 
established for any pollutant that is listed as a ``hazardous air 
pollutant'' under section 112(b)(1)(A) of the 1977 CAA.
    In 1990, Congress significantly amended the CAA. Among other 
things, it significantly amended section 112, it enacted Title IV of 
the CAA, which includes numerous provisions that are directly 
applicable to Utility Units, and it amended section 111(d). Both the 
House and the Senate bills included different amendments to section 
111(d), and both of those amendments were enacted into law.
    The first amendment, which is the House amendment, is contained in 
section 108(g) of Public Law 101-549. That section amends section 
111(d)(1)(A)(i) of the 1977 CAA by striking the words ``or 
112(b)(1)(A)'' from the 1977 CAA and inserting in its place the 
following phrase: ``or emitted from a source category which is 
regulated under section 112.'' The second amendment to section 111(d), 
which is the Senate amendment, is labeled a ``conforming amendment'' 
and is set forth in section 302 of Public Law 101-549. That section 
amends CAA section 111(d)(1) of the 1977 CAA by striking the reference 
to ``112(b)(1)(A)'' and inserting in its place ``112(b).'' The two 
amendments are reflected in parentheses in the Statutes at Large as 
follows:

    The Administrator shall prescribe regulations which shall 
establish a procedure similar to that provided by section 7410 of 
this title under which each State shall submit to the Administrator 
a plan which (A) establishes standards of performance for any 
existing source for any air pollutant (i) for which air quality 
criteria have not been issued or which is not included on a list 
published under section 7408(a) (or emitted from a source category 
which is regulated under section 112) [House amendment,] (or 112(b)) 
[Senate Amendment,] but (ii) to which a standard of performance 
under this section would apply if such existing source were a new 
source. * * *

    The United States Code does not contain the parenthetical reference 
to the Senate amendment, as set forth in section 302 of Public Law 101-
549. The codifier's notes to this section of the Official Committee 
Print of the executed law state that the Senate amendment ``could not 
be executed'' because of the other amendment to section 111(d) 
contained in the same Act. The United States Code does not control 
here, however. The Statutes at Large constitute the legal evidence of 
the laws, where, as here, Title 42 of the United States Code, which 
contains the CAA, has not been enacted into positive law. See 1 U.S.C. 
204(a); United States v. Welden, 377 U.S. 95, 98 n.4 (1964); 
Washington-Dulles Transportation Ltd. v. Metropolitan Washington 
Airports Auth., 263 F.3d 371, 378 (4th Cir. 2001). We did not receive 
any comments disputing either that the Statutes of Large constitute the 
legal evidence of the laws in this case, or that the 1990 Act contains 
two different amendments to the same statutory provision.\61\
---------------------------------------------------------------------------

    \61\ Although the notes accompanying the Official Committee 
Print do not interpret with the force of law, their conclusion about 
the appropriate effect to give these conflicting amendments is 
evidence that EPA's conclusion is reasonable.
---------------------------------------------------------------------------

2. Overview of Legislative History
    As we indicated in the proposal, there is scant legislative history 
concerning the two amendments to section 111(d). The most persuasive 
legislative history that is relevant to our task of interpreting and 
reconciling the House and Senate amendments to section 111(d) is the 
final Senate and House bills. Those bills reflect significantly 
different treatment of Utility Units under section 112, as well as 
different amendments to section 111(d).
    We begin our analysis with Senate bill 1630, as passed by the 
Senate on April 3, 1990. That bill included a provision concerning 
Utility Units. See generally Section 301 (hazardous air pollutants), A 
Legislative History of the Clean Air Act Amendments of 1990 
(``Legislative History''), Vol III, at 4431-33 (Nov. 1993). Under that 
provision, EPA was to conduct a study on the health and environmental 
effects of utility HAP emissions within three years of enactment of the 
statute. The Senate Bill also required EPA to promulgate section 112(d) 
emissions standards for Utility Units within five years of enactment of 
the statute. The Senate bill further required EPA to place the study on 
utility HAP emissions in the docket for the section 112(d) rulemaking 
for Utility Units. Finally, the Senate bill, in a section labeled 
``conforming amendments,'' amended section 111(d) by striking the 
reference to ``112(b)(1)(A)'' in the 1977 Act and replacing it with 
``112(b).'' See generally Section 305 (conforming amendments), 
Legislative History, Vol III, at 4534.
    The final bill that passed the House in May 1990 stands in stark 
contrast to the Senate Bill. The House Bill included section 112(l), 
entitled ``Electric Utilities.'' See generally Section 301 (hazardous 
air pollutants), Legislative History, Vol II, at 2148-49. That 
provision is identical to section 112(n)(1)(A). See 104 Stat. 2558. The 
House bill also amended section 111(d) by replacing the words `` or 
112(b)(1)(A)'' with ``or emitted from a source category which is 
regulated under section 112.'' See Legislative History, Vol. II, at 
179.
    Finally, the House provision concerning Utility Units is the 
provision that was enacted into law as section 112(n)(1)(A). The Senate 
approach to

[[Page 16031]]

regulating Utility Units under section 112 did not prevail. See 
Legislative History, Vol. I at 1451.
3. EPA's Interpretation of the Two Amendments to Section 111(d)
    Neither we, nor commenters, have identified a canon of statutory 
construction that addresses the specific situation with which we are 
now faced, which is how to interpret two different amendments to the 
exact same statutory provision in a final bill that has been signed by 
the President. The canon of statutory construction that calls for 
harmonizing conflicting statutory provisions, where possible, and 
adopting a reading that gives some effect to both provisions is not 
controlling here because that canon applies where two provisions of a 
statute are in conflict, not where two amendments to the same statutory 
provision are in conflict. Nevertheless, we have attempted to follow 
the general principles underlying this canon of construction. We also 
rely on the legislative history noted above as support for our 
interpretation of the two amendments to section 111(d).
    Turning first to the House amendment, we noted at proposal that a 
literal reading of that amendment is that a standard of performance 
under section 111(d) cannot be established for any air pollutant--HAP 
and non-HAP--emitted from a source category regulated under section 
112. See 69 FR 4685. Certain commenters disagreed with our reading. 
They argue instead that a literal reading of the House amendment is 
that EPA cannot regulate under section 111(d) any HAP that is emitted 
from any source category regulated under section 112. This reading 
modifies the plain language of section 111(d), as amended by the House 
in 1990, in significant respects. First, it changes the terms ``any 
pollutant'' to ``HAP,'' and second, it changes the phrase ``a source 
category,'' to ``any source category'' and therefore commenters'' 
reading of the amendment cannot be characterized as a ``literal' 
reading.
    Section 111(d), as amended by the House, specifically provides:

Each State shall submit to the Administrator a plan which (A) 
establishes standards of performance for any existing source for any 
air pollutant * * * which is not emitted from a source category 
which is regulated under section 112.

    We interpret this language to mean that EPA cannot establish a 
standard of performance under CAA section 111(d) for any ``air 
pollutant''--including both HAP and non-HAP--that is emitted from a 
particular source category regulated under section 112. Thus, under our 
interpretation, if source category X is ``a source category'' regulated 
under section 112, EPA could not regulate HAP or non-HAP from that 
source category under section 111(d). This interpretation reflects the 
distinction drawn in section 111(d), as amended by the House, between 
``any pollutant'' and ``a source category.'' The phrase ``any 
pollutant'' existed prior to the 1990 amendments and therefore it can 
be reasonably assumed that when the House amended section 111(d) in 
1990, it intentionally chose the words ``a source category,'' as 
opposed to ``any source category. Although we recognize that the phrase 
``a source category'' is susceptible to different interpretations, in 
that it could conceivably mean one or many source categories, we 
believe that our interpretation is a permissible construction given the 
juxtaposition of the phrases ``any pollutant'' and ``a source 
category'' in section 111(d), as amended by the House.
    Moreover, consistent with our interpretation of the House 
amendment, we believe that the House sought to change the focus of 
section 111(d) by seeking to preclude regulation of those pollutants 
that are emitted from a particular source category that is actually 
regulated under section 112. The legislative history described above is 
instructive in this regard. At the same time the House substantively 
amended section 111(d), it passed a bill containing a provision 
(section 112(l)) that is identical to section 112(n)(1)(A) of the 
current act. Section 112(l) of the House bill calls for EPA to examine 
how the ``imposition of the requirements of th[e] Act'' would affect 
utility HAP emissions. This provision suggests that the House did not 
want to subject Utility Units to duplicative or overlapping regulation. 
In this regard, the House's amendment to section 111(d) could 
reasonably reflect its effort to expand EPA's authority under section 
111(d) for regulating pollutants emitted from particular source 
categories that are not being regulated under section 112. Such a 
reading of the House language would authorize EPA to regulate under 
section 111(d) existing area sources which EPA determined did not meet 
the statutory criterion set forth in section 112(c)(3), as well as 
existing Utility Units (in the event EPA did not decide to regulate 
such units under section 112).
    The Senate amendment provides that a section 111(d) standard of 
performance cannot be established for any HAP that is listed in section 
112(b)(1), regardless of whether the source categories that emit such 
HAP are actually regulated under section 112. The Senate amendment 
reflects the Senate's intent to retain the pre-1990 approach of 
precluding regulation under CAA section 111(d) of any HAP listed under 
section 112(b). The Senate's intent in this regard is confirmed by the 
fact that its amendment is labeled a ``conforming amendment,'' which is 
generally a non-substantive amendment. By contrast, the House amendment 
is not a conforming amendment.\62\
---------------------------------------------------------------------------

    \62\ There is a section of the final House bill that includes 
conforming amendments. The House amendment to section 111(d) does 
not appear in that sectiono of the bill, however. See Legislative 
History, Vol. II, at 179, 1986.
---------------------------------------------------------------------------

    Moreover, the Senate's conforming amendment is consistent with the 
Senate's treatment of Utility Units in the final Senate Bill. Unlike 
the House bill, the Senate bill did not call for an examination of the 
other requirements of the CAA. Nor did it provide EPA discretion to 
determine whether Utility Units should be regulated under section 112. 
Instead, the Senate bill included a provision that would have required 
EPA to establish section 112(d) emission standards for Utility Units by 
a date certain. This provision, which was never enacted into law, is 
consistent with the Senate's conforming amendment which provides that 
HAP listed under section 112(b) cannot be regulated under section 
111(d).
    Based on the legislative history described above, we believe that 
the House amendment, as we have interpreted it, is wholly consistent 
with section 112(l) of the House bill, which the conference committee 
adopted as the provision governing Utility Units (section 112(n)(1)(A). 
It is hard to conceive that Congress would have adopted section 
112(n)(1)(A), yet retained the Senate amendment to section 111(d). 
While it appears that the Senate amendment to section 111(d) is a 
drafting error and therefore should not be considered, we must attempt 
to give effect to both the House and Senate amendments, as they are 
both part of the current law.
    The House and Senate amendments conflict in that they provide 
different standards as to the scope of EPA's authority to regulate 
under section 111(d). As we explained at proposal, in an effort to give 
some effect to both amendments, we reasonably interpret the amendments 
as follows: Where a source category is being regulated under section 
112, a section 111(d) standard of performance cannot be established to 
address any HAP listed under section 112(b) that may be emitted from 
that particular source category. Thus, if EPA is regulating source 
category X under section 112, section 111(d) could not be

[[Page 16032]]

used to regulate any HAP emissions from that particular source 
category. This is a reasonable interpretation of the amendments to 
section 111(d) because it gives some effect to both amendments. First, 
it gives effect to the Senate's desire to focus on HAP listed under 
section 112(b), rather than applying the section 111(d) exclusion to 
non-HAP emitted from a source category regulated under section 112, 
which a literal reading of the House amendment would do. Second, it 
gives effect to the House's desire to increase the scope of EPA's 
authority under section 111(d) and to avoid duplicative regulation of 
HAP for a particular source category. See 136 Cong. Rec. H12911, 12934 
(daily ed. Oct. 26, 1990) (the conferees adopted section 112(n)(1)(A) 
``because of the logic of basing any decision to regulate on the 
results of scientific study and because of the emission reductions that 
will be achieved and the extremely high costs that electric utilities 
will face under other provisions of the new Clean Air Act 
amendments.'').
    We recognize that our proposed reconciliation of the two 
conflicting amendments does not give full effect to the House's 
language, because a literal reading of the House language would mean 
that EPA could not regulate HAP or non-HAP emitted from a source 
category regulated under section 112. Such a reading would be 
inconsistent with the general thrust of the 1990 amendments, which, on 
balance, reflects Congress' desire to require EPA to regulate more 
substances, not to eliminate EPA's ability to regulate large categories 
of pollutants like non-HAP. Furthermore, EPA has historically regulated 
non-HAP under section 111(d), even where those non-HAP were emitted 
from a source category actually regulated under section 112. See, e.g., 
40 CFR 62.1100 (California State Plan for Control of Fluoride Emissions 
from Existing Facilities at Phosphate Fertilizer Plants). We do not 
believe that Congress sought to eliminate regulation for a large 
category of sources in the 1990 Amendments and our proposed 
interpretation of the two amendments to section 111(d) avoids this 
result.\63\
---------------------------------------------------------------------------

    \63\ The first instance in which the Agency proposed an 
interpretation of the conflicting House and Senate amendments to CAA 
section 111(d) was in the January 2004 proposed rule. We recognize 
that we may have made statements concerning section 111(d), since 
the 1990 Amendments, but those statements did not recognize or 
account for the two different amendments to section 111(d), as 
enacted in 1990. We are also amending 40 CFR 60.21, as part of the 
final CAMR. That regulation, which was promulgated in 1975, 
interprets the 1970 CAA and defines a ``designated pollutant'' for 
purposes of section 111(d), as excluding any pollutant that is 
listed on the section 112(b)(1)(A) list. There is no section 
112(b)(1)(A) in the current act, as amended in 1990. We are 
therefore revising 40 CFR 60.21 because it does not reflect the 
current language of section 111(d), as amended in 1990.
---------------------------------------------------------------------------

    Finally, in assessing whether to revise the December 2000 
``necessary'' finding, it is reasonable to look to whether CAA section 
111 constituted a viable alternative authority for regulating utility 
HAP emissions prior to the December 2000 finding. The answer is yes and 
therefore under our proposed interpretation of the conflicting 
amendments, we could have regulated HAP from Utility Units under 
section 111(d). We listed coal- and oil-fired Utility Units under 
section 112(c) in December 2000 based solely on our appropriate and 
necessary finding. As explained above, that finding lacks foundation 
and recent information confirms that it is neither appropriate nor 
necessary to regulate Utility Units under CAA section 112. We should 
have recognized prior to the December 2000 finding that section 111 
constituted a viable authority for regulating utility HAP emissions and 
therefore should have never listed Utility Units on the Section 112(c) 
list. In addition, as explained below, the December 2000 finding and 
associated listing is not a final agency action and EPA can therefore 
make revisions to that finding at any point prior to taking final 
action. Such revisions are particularly appropriate here, because the 
prior finding is incorrect and new information confirms this fact.
    Some commenters argue that their reading of the House amendment and 
reconciliation of the amendments is reasonable, but the question is not 
whether commenters have identified a reasonable construction of section 
112(d). Rather, the issue is whether our construction is a permissible 
one, and for the reasons set forth above, we believe that it is. See 
Smiley v. Citibank, N.A. 517 U.S. 735, 744-45 (1996) (a ``permissible'' 
interpretation is one that is ``reasonable''). Other commenters 
effectively ask us to ignore the House amendment because the Senate 
amendment reflects the law as of 1977. We cannot ignore the House 
amendment, as it is part of current law, and Congress substantially 
amended the law in 1990, by including, among other things, section 
112(n)(1)(A).\64\
---------------------------------------------------------------------------

    \64\ Finally, some commenters argue that EPA's interpretation of 
the conflicting amendments was unreasonable, because it would give 
EPA discretion to regulate area sources, under section 111, as 
opposed to section 112. These commenters fail to recognize the 
listing criteria for area sources under section 112(c)(3). That 
section, for example, provides that EPA shall list a category or 
subcategory of area sources under section 112 if it finds that the 
category or subcategory presents a threat of adverse effects to 
human health or the environment in a manner ``that warrants 
regulation under section 112.'' Thus, EPA must determine whether the 
category or subcategory presents a threat that warrants regulation 
under section 112. If EPA determined that the listing criteria for a 
category of area sources were not met, nothing would preclude EPA 
from regulating HAP from that category under section 111(d), which 
contains different requirements for regulation. See General Overview 
of section 111 above.
    Another commenter argued that EPA's interpretation of the two 
amendments is contrary to a canon of statutory construction that 
provides that where a conflict exists between two provisions of an 
act, the last provision in point of arrangement controls. This 
commenter argues that because the Senate conforming amendment is 
found in section 302 of Public Law 101-549, and the House amendment 
in section 108(g), the Senate amendment should control. As explained 
above, this canon of statutory construction is not directly relevant 
to situations where the conflict at issue is between two different 
amendments to the same statutory provision. Furthermore, application 
of this canon of construction would be contrary to the legislative 
history described above.
---------------------------------------------------------------------------

VIII. Removal of Coal- and Oil-Fired Utility Units From the Section 
112(C) List

    Section 112(n)(1)(A) sets forth the criteria for regulating Utility 
Units under section 112. The criteria are: Whether regulation of 
Utility Units under section 112 of the CAA is ``appropriate'' and 
``necessary.'' In December 2000, EPA added coal- and oil-fired Utility 
Units to the section 112(c) list in light of its positive appropriate 
and necessary finding for such units. See 65 FR 79831.
    In the January 2004 proposed rule, EPA proposed removing coal- and 
oil-fired Utility Units from the section 112(c) list based on our 
proposed reversal of the December 2000 finding. Today, we conclude that 
the December 2000 finding lacked foundation and that regulation of 
coal- and oil-fired Utility Units under section 112 is not appropriate 
and necessary. Based on those decisions and our revision of the 
December 2000 finding, we remove coal- and oil-fired Utility Units from 
the section 112(c) list. We disagree with those commenters that argue 
that EPA cannot remove coal and oil-fired Utility Units from the 
section 112(c) list without satisfying the delisting criteria in 
section 112(c)(9).
    EPA reasonably interprets section 112(n)(1)(A) as providing it 
authority to remove coal- and oil-fired units from the section 112(c) 
list at any time that it makes a negative appropriate and necessary 
finding under the section. Congress set up an entirely different 
structure and predicate for assessing whether Utility Units should be 
listed for regulation under section 112. Compare 112(c)(1) and (c)(3), 
with 112(n)(1)(A). Section 112(n)(1)(A)

[[Page 16033]]

therefore occupies the field in section 112 with regard to Utility 
Units. Section 112(n)(1)(A) provides EPA significant discretion in 
making the appropriate and necessary finding and nothing in section 
112(n)(1)(A) suggests that EPA cannot revise its finding, where, as 
here, it has both identified errors in its prior finding and determined 
that the finding lacked foundation, and where EPA has received new 
information that confirms that it is not appropriate or necessary to 
regulate coal- and oil-fired Utility Units under section 112.\65\
---------------------------------------------------------------------------

    \65\ Although not critical to our analysis, we do note that it 
is questionable whether we even had a legal obligation in December 
2000 to list Utility Units under section 112(c) after making the 
positive appropriate and necessary finding. Section 112(n)(1)(A) 
makes no reference to CAA section 112(c) and the framework of 
section 112(c)(1) and (c)(3) does not expressly provide for the 
listing of Utility Units. Rather, those provisions speak to major 
and area sources, which Congress treated differently from Utility 
Units.
---------------------------------------------------------------------------

    The section 112(c)(9) criteria also do not apply in two situations 
that are directly relevant here. First, the December 2000 appropriate 
and necessary finding and associated listing are not final agency 
actions. UARG v. EPA, 2001 WL 936363, No. 01-1074 (DC Cir. July 26, 
2001). EPA therefore has inherent authority under the CAA to revise 
those actions at any time based on either identified errors in the 
December 2000 finding or on new information that bears upon that 
finding. Second, as explained in the proposed rule, the section 
112(c)(9) criteria do not apply where, as here, the source category at 
issue did not meet the statutory criteria for listing at the time of 
listing. See 68 FR 28197, 28200 June 4, 1996; see also 69 FR 4689 
(citing additional examples where EPA has removed a source category 
from the section 112(c) list without following the criteria in section 
112(c)(9) due to an error at the time of listing). For all of the 
reasons noted above, EPA did not meet the statutory listing criteria at 
the time of listing for coal- and oil-fired Utility Units. Accordingly, 
coal- and oil-fired Utility Units should never have been listed under 
section 112(c) and therefore the criteria of section 112(c)(9) do not 
apply to today's action.

IX. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), the 
Agency must determine whether a regulatory action is ``significant'' 
and therefore subject to Office of Management and Budget (OMB) review 
and the requirements of the Executive Order. The Order defines 
``significant regulatory action'' as one that is likely to result in a 
rule that may:
    1. Have an annual effect on the economy of $100 million or more or 
adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or Tribal governments or 
communities;
    2. Create a serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    3. Materially alter the budgetary impact of entitlements, grants, 
user fees, or loan programs or the rights and obligations of recipients 
thereof; or
    4. Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.
    Pursuant to the terms of Executive Order 12866, OMB has notified us 
that it considers this a ``significant regulatory action'' within the 
meaning of the Executive Order. We have submitted this action to OMB 
for review. However, EPA has determined that this rulemaking will not 
have a significant economic impact. Changes made in response to OMB 
suggestions or recommendations will be documented in the public record. 
All written comments from OMB to EPA and any written EPA response to 
any of those comments are included in the docket listed at the 
beginning of this notice under ADDRESSES.

B. Paperwork Reduction Act

    This action does not contain any information collection 
requirements and therefore is not subject to the Paperwork Reduction 
Act (44 U.S.C. 3501 et seq.).

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) (RFA), as 
amended by the Small Business Regulatory Enforcement Fairness Act (Pub. 
L. 104-121) (SBREFA), provides that whenever an agency is required to 
publish a general notice of rulemaking, it must prepare a regulatory 
flexibility analysis, unless it certifies that the rule, if 
promulgated, will not have ``a significant economic impact on a 
substantial number of small entities.'' 5 U.S.C. 605(b). Small entities 
include small businesses, small organizations, and small governmental 
jurisdictions.
    As was discussed in the January 30, 2004 NPR, EPA determined that 
it was not necessary to prepare a regulatory flexibility analysis in 
conjunction with this rulemaking. We certify that this action will not 
have a significant impact on a substantial number of small entities 
because it imposes no regulatory requirements.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4) (UMRA), establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and Tribal 
governments and the private sector. Under UMRA section 202, 2 U.S.C. 
1532, EPA generally must prepare a written statement, including a cost-
benefit analysis, for any proposed or final rule that ``includes any 
Federal mandate that may result in the expenditure by State, local, and 
Tribal governments, in the aggregate, or by the private sector, of 
$100,000,000 or more * * * in any one year.'' A ``Federal mandate'' is 
defined under section 421(6), 2 U.S.C. 658(6), to include a ``Federal 
intergovernmental mandate'' and a ``Federal private sector mandate.'' A 
``Federal intergovernmental mandate,'' in turn, is defined to include a 
regulation that ``would impose an enforceable duty upon State, local, 
or Tribal governments,'' section 421(5)(A)(i), 2 U.S.C. 658(5)(A)(i), 
except for, among other things, a duty that is ``a condition of Federal 
assistance,'' section 421(5)(A)(i)(I). A ``Federal private sector 
mandate'' includes a regulation that ``would impose an enforceable duty 
upon the private sector,'' with certain exceptions, section 421(7)(A), 
2 U.S.C. 658(7)(A).
    We have determined that the final rule does not contain a Federal 
mandate that may result in expenditures of $100 million or more for 
State, local, or tribal governments, in the aggregate, or the private 
sector in any 1 year. Thus, today's final rule is not subject to the 
requirements of sections 202 and 205 of the UMRA. In addition, we have 
determined that the final rule contains no regulatory requirements that 
might significantly or uniquely affect small governments because it 
contains no regulatory requirements that apply to such governments or 
impose obligations upon them. Therefore, the final rule is not subject 
to the requirements of section 203 of UMRA.

E. Executive Order 13132: Federalism

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August 
10, 1999), requires EPA to develop an accountable process to ensure 
``meaningful and timely input by State and local officials in the 
development of regulatory policies that have federalism implications.'' 
``Policies that have federalism implications'' is defined in the EO to 
include regulations that have

[[Page 16034]]

``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.''
    This rule does not have federalism implications. It will not have 
substantial direct effects on the States, on the relationship between 
the national government and the States, or on the distribution of power 
and responsibilities among the various levels of government, as 
specified in EO 13132. The CAA establishes the relationship between the 
Federal government and the States, and this rule does not impact that 
relationship. Thus, EO 13132 does not apply to this rule. However, in 
the spirit of EO 13132, and consistent with EPA policy to promote 
communications between EPA and State and local governments, EPA 
specifically solicited comment on this rule from State and local 
officials.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    EO 13175, entitled ``Consultation and Coordination with Indian 
Tribal Governments'' (65 FR 67249, November 9, 2000), requires EPA to 
develop an accountable process to ensure ``meaningful and timely input 
by Tribal officials in the development of regulatory policies that have 
Tribal implications.''
    This rule does not have Tribal implications as defined by EO 13175. 
It does not have a substantial direct effect on one or more Indian 
Tribes, in that it is a determination not to regulate utilities under 
section 112, and therefore imposes no burdens on tribes. Furthermore, 
this rule does not affect the relationship or distribution of power and 
responsibilities between the Federal government and Indian Tribes. The 
CAA and the Tribal Authority Rule (TAR) establish the relationship of 
the Federal government and Tribes in implementing the Clean Air Act. 
Because this rule does not have Tribal implications, EO 13175 does not 
apply.
    Although EO 13175 does not apply to this rule, EPA took several 
steps to consult with Tribal officials in developing this rule. EPA 
gave a presentation to a national meeting of the Tribal Environmental 
Council (NTEC) in April 2001, and encouraged Tribal input at an early 
stage. EPA then worked with NTEC to find a Tribal representative to 
participate in the workgroup developing the rule, and included a 
representative from the Navajo Nation as a member the official 
workgroup, with a representative from the Campo Band later added as an 
alternate. In March 2004, EPA provided a briefing for Tribal 
representatives and the newly formed National Tribal Air Association 
and NTEC. EPA received comments on this rule from a number of tribes, 
and has taken those comments and other input from Tribal 
representatives into consideration in development of this rule.

G. Executive Order 13045: Protection of Children From Environmental 
Health and Safety Risks

    Executive Order 13045, ``Protection of Children from Environmental 
Health and Safety Risks'' (62 FR 19885, April 23, 1997) applies to any 
rule that (1) is determined to be ``economically significant'' as 
defined under EO 12866, and (2) concerns an environmental health or 
safety risk that EPA has reason to believe may have a disproportionate 
effect on children. If the regulatory action meets both criteria, 
section 5-501 of the EO directs the Agency to evaluate the 
environmental health or safety effects of the planned rule on children, 
and explain why the planned regulation is preferable to other 
potentially effective and reasonably feasible alternatives considered 
by the Agency.
    The final rule is not subject to Executive Order 13045 because it 
is not an economically significant regulatory action as defined by 
Executive Order 12866. In addition, EPA interprets Executive Order 
13045 as applying only to those regulatory actions that are based on 
health and safety risks, such that the analysis required under section 
5-501 of the Executive Order has the potential to influence the 
regulations. The final rule is not subject to Executive Order 13045 
because it does not include regulatory requirements based on health or 
safety risks.
    Nonetheless, in making its determination as to whether it is 
``appropriate and necessary'' to regulate Utility Units under section 
112, EPA considered the effects of utility HAP emissions on both the 
general population and sensitive subpopulations, including children.

H. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use

    Executive Order 13211 (66 FR 28355, May 22, 2001) provides that 
agencies shall prepare and submit to the Administrator of the Office of 
Regulatory Affairs, OMB, a Statement of Energy Effects for certain 
actions identified as ``significant energy actions.'' Section 4(b) of 
EO 13211 defines ``significant energy actions'' as ``any action by an 
agency (normally published in the Federal Register) that promulgates or 
is expected to lead to the promulgation of a final rule or regulation, 
including notices of inquiry, advance notices of final rulemaking, and 
notices of final rulemaking: (1) (i) That is a significant regulatory 
action under EO 12866 or any successor order, and (ii) is likely to 
have a significant adverse effect on the supply, distribution, or use 
of energy; or (2) that is designated by the Administrator of the Office 
of Information and Regulatory Affairs as a ``significant energy 
action.'' Although this final rule is a significant regulatory action 
under EO 12866, it will not have a significant adverse effect on the 
supply, distribution, or use of energy.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act (NTTAA) of 1995 (Pub. L. 104-113; Section 12(d), 15 U.S.C. 272 
note) directs EPA to use voluntary consensus standards (VCS) in their 
regulatory and procurement activities unless to do so would be 
inconsistent with applicable law or otherwise impractical. Voluntary 
consensus standards are technical standards (e.g., materials 
specifications, test methods, sampling procedures, business practices) 
developed or adopted by one or more voluntary consensus bodies. NTTAA 
directs EPA to provide Congress, through annual reports to OMB, with 
explanations when an agency does not use available and applicable VCS.
    This action does not involve technical standards and therefore the 
NTTAA does not apply.

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898, ``Federal Actions to Address Environmental 
Justice in Minority Populations and Low-Income Populations,'' provides 
for Federal agencies to consider the impact of programs, policies, and 
activities on minority populations and low-income populations, 
including tribes.
    As described above, in making its determination as to whether it is 
``appropriate and necessary'' to regulate Utility Units under section 
112, EPA considered the effects of utility HAP emissions on both the 
general population and sensitive subpopulations, including subsistence 
fish-eaters. EPA's analysis considered such subpopulations as the 
Chippewa in Minnesota, Wisconsin, and Michigan; and the Hmong in 
Minnesota and

[[Page 16035]]

Wisconsin. As explained above, the Agency has concluded that it is not 
``appropriate and necessary'' to regulate Utility Units under section 
112, in light of all available information, including information on 
subsistence fish-eaters. The Agency believes that implementation of the 
CAIR and, independently, the CAMR will remove the hazards to public 
health resulting from utility HAP emissions.
    This action, however, does not actually regulate HAP emissions from 
utilities. The CAMR does regulate Hg emissions from utilities, and it 
is in the CAMR rulemaking that EPA has addressed the impacts of that 
regulation on the populations addressed by Executive Order 12898.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by 
SBREFA 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 U.S. The 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 U.S. prior 
to publication of the rule in the Federal Register. The final rule is 
not a ``major rule'' as defined by 5 U.S.C. 804(2). The final rule will 
be effective on March 29, 2005.

    Dated: March 15, 2005.
Stephen Johnson,
Acting Administrator.
[FR Doc. 05-6037 Filed 3-28-05; 8:45 am]
BILLING CODE 6560-50-P