[Federal Register Volume 70, Number 111 (Friday, June 10, 2005)]
[Rules and Regulations]
[Pages 33838-33850]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-11546]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 51 and 52

[FRL-7923-3; E-Docket ID No. OAR-2002-0068]
RIN 2060-AM58


Prevention of Significant Deterioration (PSD) and Non-attainment 
New Source Review (NSR): Equipment Replacement Provision of the Routine 
Maintenance, Repair and Replacement Exclusion: Reconsideration

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of final action on reconsideration.

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SUMMARY: On October 27, 2003, and December 24, 2003, the EPA revised 
regulations governing the major New Source Review (NSR) programs 
mandated by parts C and D of title I of the Clean Air Act (CAA or Act). 
The rule changes from October 27, 2003, provide a category of equipment 
replacement activities that are deemed to be routine maintenance, 
repair and replacement (RMRR) activities and, therefore, are not 
subject to Major NSR requirements under the exclusion, while the 
December 24, 2003 rule changes amended the Prevention of Significant 
Deterioration (PSD) provisions of state programs that did not have 
approved state rules for PSD. Also on December 24, 2003, the U.S. Court 
of Appeals for the District of Columbia Circuit stayed the new RMRR 
rules, pending judicial review. Following these actions, the 
Administrator received petitions for reconsideration. On July 1, 2004, 
we, the EPA, announced our reconsideration of certain issues arising 
from these two final rules and requested comment on those issues. After 
carefully considering all of the comments and information received 
through our reconsideration process, we have concluded that no 
additional changes are necessary to the final rules. With respect to 
all other issues raised by the petitioners, we deny the requests for 
reconsideration.

DATES: This final action is effective on June 10, 2005.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. OAR-2002-0068 (Legacy Number A-2002-04). All documents in the 
docket are listed in the index. Although listed in the index, some 
information is not publicly available, i.e., CBI or other information 
whose disclosure is restricted by statute. Publicly available docket 
materials are available in hard copy either electronically in the 
EDOCKET at http://www.epa.gov/edocket or in hard copy at the U.S. 
Environmental Protection Agency, EPA West (Air Docket), 1200 
Pennsylvania Avenue, Northwest, B102, Mail code: 6102T, Washington, DC 
20460, Attention Docket ID No. OAR-2002-0068, Washington, DC 20004. 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 Docket 
is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: Mr. David J. Svendsgaard, Information 
Transfer and Program Integration Division (C339-03), U.S. Environmental 
Protection Agency, Research Triangle Park, NC 27711, telephone number: 
(919) 541-2380; fax number: (919) 541-5509, or electronic mail at 
[email protected].

SUPPLEMENTARY INFORMATION:

I. General Information

A. What are the Regulated Entities?

    Entities potentially affected by the subject rule for today's 
action include sources in all industry groups. The majority of sources 
potentially affected are expected to be in the following groups.

------------------------------------------------------------------------
           Industry group              SIC \a\          NAICS \b\
------------------------------------------------------------------------
Electric Services...................        491  221111, 221112, 221113,
                                                  221119, 221121,
                                                  221122.
Petroleum Refining..................        291  324110.
Industrial Inorganic Chemicals......        281  325181, 325120, 325131,
                                                  325182, 211112,
                                                  325998, 331311,
                                                  325188.
Industrial Organic Chemicals........        286  325110, 325132, 325192,
                                                  325188, 325193,
                                                  325120, 325199.
Miscellaneous Chemical Products.....        289  325520, 325920, 325910,
                                                  325182, 325510.
Natural Gas Liquids.................        132  211112.
Natural Gas Transport...............        492  486210, 221210.
Pulp and Paper Mills................        261  322110, 322121, 322122,
                                                  322130.
Paper Mills.........................        262  322121, 322122.
Automobile Manufacturing............        371  336111, 336112, 336211,
                                                  336992, 336322,
                                                  336312, 336330,
                                                  336340, 336350,
                                                  336399, 336212,
                                                  336213.

[[Page 33839]]

 
Pharmaceuticals.....................        283  325411, 325412, 325413,
                                                  325414.
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\a\ Standard Industrial Classification.
\b\ North American Industry Classification System.

    Entities potentially affected by the subject rule for today's 
action also include State, local, and tribal governments.

B. How Is This Preamble Organized?

    The information presented in this preamble is organized as follows:
I. General Information
    A. What are the regulated entities?
    B. How is this preamble organized?
II. Background
III. Today's Action
    A. Three Issues for Which Reconsideration Was Granted
    1. Legal Basis
    2. The 20 Percent Replacement Cost Threshold
    3. Revisions to the Format for Incorporating the PSD FIP into 
State Plans
    B. Remaining Issues in Petitions for Reconsideration
    1. Petitioners' claim that EPA retroactively applied the ERP
    2. Petitioners' claim that EPA cannot modify a State's SIP 
without a finding of deficiency
IV. Statutory and Executive Order Reviews
    A. Executive Order 12866--Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132--Federalism
    F. Executive Order 13175--Consultation and Coordination with 
Indian Tribal Governments
    G. Executive Order 13045--Protection of Children from 
Environmental Health & Safety Risks
    H. Executive Order 13211--Actions That Significantly Affect 
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Congressional Review Act
V. Statutory Authority
VI. Judicial Review

II. Background

    On October 27, 2003, we published the Equipment Replacement 
Provision (``ERP'') amendments to our regulations implementing the 
major NSR requirements of the CAA.\1\ The ERP amended the exclusion 
from major NSR for ``routine maintenance, repair, and replacement'' 
(``RMRR'') activities at existing major sources. Several parties sought 
judicial review of the ERP in the U.S. Court of Appeals for the 
District of Columbia Circuit. See State of New York v. EPA, No. 03-1380 
and consolidated cases (DC Cir.). As a result of a court order, the ERP 
is ``stayed'' (i.e., not in effect) until the court decides this case.
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    \1\ The October 27, 2003 final rule did not act on the ``Annual 
Maintenance, Repair and Replacement Allowance'' approach that we 
proposed on December 31, 2002 (67 FR 80920). We may act on this 
portion of the 2002 proposal in a subsequent rulemaking.
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    On December 24, 2003, EPA published a rule amending the Prevention 
of Significant Deterioration (PSD) provisions of state programs that 
did not have approved state rules for PSD. 68 FR 74483. In each of 
these states, EPA previously had made the area subject to the PSD rules 
in 40 CFR 52.21, the Federal Implementation Plan (``FIP'') for PSD. 
Please see 68 FR 74483 (December 24, 2003), for additional background 
on this rule. Parties have also sought judicial review of this rule, 
and their petitions for review have been consolidated with the 
challenges to the ERP.
    Also on December 24, 2003, a group of environmental organizations 
\2\ petitioned EPA, pursuant to section 307(d)(7)(B) of the CAA, to 
reconsider three aspects of the Equipment Replacement Provision that we 
published on October 27, 2003. Specifically, the petitioners \3\ 
asserted that our legal basis for the ERP is flawed, the basis for the 
20 percent ERP cost threshold is arbitrary and capricious, and EPA has 
retroactively applied the ERP.
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    \2\ The following parties filed the petition for reconsideration 
of the October 27, 2003 rule: Natural Resources Defense Council, 
Environmental Defense, Sierra Club, American Lung Association, 
Communities for a Better Environment, United States Public Interest 
Research Group, Alabama Environmental Council, Clean Air Council, 
Group Against Smog and Pollution, Michigan Environmental Council, 
The Ohio Environmental Council, Scenic Hudson, and Southern Alliance 
for Clean Energy.
    \3\ In this notice, the term ``petitioner'' refers only to those 
entities that filed petitions for reconsideration with EPA.
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    On January 16, 2004, a subset of the environmental petitioners on 
the ERP rule filed a petition for reconsideration of the December 24, 
2003 rule that incorporated the ERP into the FIP portion of a State 
plan where the State does not have an approved PSD State Implementation 
Plan (SIP). This petition reiterated the issues raised in the December 
24, 2003 petition concerning the ERP. On February 23, 2004, a group of 
states and the District of Columbia \4\ filed a petition for 
reconsideration of the December 24, 2003 rule. This petition raised two 
issues. First, it asked for reconsideration on whether EPA needed to 
make a finding of deficiency for the PSD portions of each SIP before it 
amended the incorporation of the PSD FIP into the state plans. Second, 
it challenged whether EPA needed to provide an opportunity for comment 
on the revised format for incorporating the PSD FIP into state plans, 
which would automatically update the state plans whenever EPA amends 
the PSD FIP.
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    \4\ The states that filed a petition for reconsideration of the 
December 24, 2003 rule are California, Connecticut, Illinois, 
Massachusetts, New Jersey, and New York, along with the District of 
Columbia.
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    On July 1, 2004 (69 FR 40278), we granted reconsideration and 
requested comment on three issues raised by petitioners--specifically, 
the contentions that our legal basis is flawed, that our selection of 
20 percent for the cost limit is arbitrary and capricious and lacks 
sufficient record, and that we should provide an opportunity for 
comment on the revised format for incorporating the PSD FIP into state 
plans. We decided to grant reconsideration on these issues because of 
the importance EPA attaches to ensuring that all have ample opportunity 
to comment. At that time, we did not act on the remaining two issues in 
those petitions.
    On August 2, 2004, we held a public hearing on the issues for which 
we granted reconsideration. Five individuals gave oral presentations at 
the hearing. The transcript of their comments is located in Docket OAR-
2002-0068 (Legacy Number A-2002-04), which can be accessed on the 
Internet at http://www.epa.gov/edocket.
    The public comment period on the reconsideration issues ended on 
August 30, 2004, and we allowed until September 1, 2004 to receive 
public comments for issues arising out of the August 2nd public 
hearing. More than 350 written public comments on the reconsideration 
issues were received. The individual comment letters can be found in 
Docket OAR-2002-0068 (Legacy Number A-2002-04).

III. Today's Action

    At this time, we are announcing our final action on reconsideration 
of the three issues for which we asked for comment in our July 1, 2004 
notice. We

[[Page 33840]]

are also announcing our final decision on the remaining two issues that 
were raised by the petitioners. We are making available a document 
entitled, ``Technical Support Document for the Equipment Replacement 
Provision of the Routine Maintenance, Repair and Replacement Exclusion: 
Reconsideration,'' EPA 456/R-05-003. This document contains (1) a 
summary of comments received on the issues for which we granted 
reconsideration and our responses to these comments, and (2) a summary 
of petition issues for which we are not granting reconsideration, and 
our rationale for denying reconsideration. This document is available 
on our Web site at http://www.epa.gov/nsr/; and, through the National 
Technical Information Services, 5285 Port Royal Road, Springfield, VA 
22161; telephone (800) 553-6846, e-mail http://www.ntis.gov; and, from 
the U.S. EPA, Library Services, MD C267-01, Research Triangle Park, NC 
27711, telephone (919) 541-2777, e-mail [email protected].

A. Three Issues for Which Reconsideration Was Granted

1. Legal Basis
    Our July 1, 2004 notice noted that underlying our legal rationale 
for the ERP is a basic tenet of administrative law stated in Chevron, 
U.S.A., Inc. v. NRDC, 467 U.S. 837 (1984). The Chevron Court held that 
expert agencies have the discretion to reasonably interpret ambiguous 
statutory terms and that such interpretations are due deference. Id. at 
842-845. In the October 27, 2003 final rule and in the July 1, 2004 
notice, we explained that the statutory definition of `modification,' 
CAA 111(a)(4), and, in particular, the word ``change'' in the phrase 
``any physical change or change in the method of operation,'' is 
ambiguous. The word itself is ambiguous, and the use of ``any'' as a 
modifier, in the context of the statute, simply requires EPA to include 
an indeterminate number of changes as potential modifications \5\ once 
EPA defines the ambiguous term ``change.'' The ERP, which establishes 
criteria for determining what equipment replacement activities do not 
constitute physical changes, is a rational interpretation of ``physical 
change'' in the definition of ``modification.'' See 68 FR 61268-61274 
for our more detailed legal support for the ERP.
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    \5\ A physical change would be a modification only if it 
resulted in a significant emissions increase as we define the term.
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    In granting reconsideration, we invited comments on several legal 
arguments suggested by commenters on the meaning of the statutory 
definition of ``modification.'' In particular, we noted that commenters 
had suggested that the plain meaning of the ``modification'' definition 
required that functionally equivalent equipment replacements not be 
deemed to be changes and, therefore, be deemed RMRR. We also noted that 
other commenters took the opposite view about the plain meaning of the 
statute. Both sides of this argument cited the principle from Chevron 
that where the statute's meaning is clear, the agency must give its 
meaning effect (the first step in statutory analysis under Chevron, or 
Chevron 1). Some commenters had argued that only de minimis exceptions 
could be allowed under the statute. Others had pointed out that a 
recognized principle of administrative law allows an agency to 
establish ``bright line'' criteria to reduce regulatory burden and 
provide certainty. We invited comment on these arguments and any other 
possible legal arguments when we granted reconsideration on the issue 
of whether our legal basis in the ERP was flawed.
    We received a number of comments supporting and opposing the legal 
basis for our rule. Commenters renewed and expanded prior arguments 
that the definition of ``modification'' was clear and either prohibited 
or compelled treating like-kind replacements as physical changes when 
replacement resulted in a potential emissions increase. Some comments, 
summarized below, addressed Congressional intent as construed by 
courts, provided specific textual analysis of the modification 
definition, and offered policy objections to the ERP. We discuss 
significant comments below and refer you to the TSD for this action for 
additional discussion of comments and responses.
    a. Congressional Intent. Commenters assert that the ERP is contrary 
to Congressional intent and the decision in Alabama Power v. Costle, 
636 F.2d 323 (D.C. Cir. 1979). They characterize the opinion as holding 
that Congressional intent behind the modification provision was to 
include any physical change that increases emissions, even though it 
would undoubtedly prove inconvenient and costly to affected industries. 
They cite a portion of the opinion that declared, ``the term 
`modification' is nowhere limited to physical changes that exceed a 
certain magnitude.'' Additionally, they claim the Court found EPA's 
authority to exempt activity from ``modification'' was limited to de 
minimis activity. Id. at 400.
    We disagree with the commenters' reading of Alabama Power. Alabama 
Power does not directly address whether like-kind replacements must be 
deemed to be physical changes. The Alabama Power Court addressed an 
exemption for physical changes that resulted in an emissions increase 
of less than 100 tons. It is in this context, where the replacement 
activity has been conceded to be a physical change, that the court 
states that the modification definition ``is nowhere limited to 
physical changes that exceed a certain magnitude.'' Alabama Power, 636 
F.2d at 400. In context, the ``magnitude'' language only addresses the 
size of the emission tonnage increase resulting from a ``change,'' once 
the activity meets the definition of a ``change.'' The Court did not 
have before it the question of whether the phrase ``any physical 
change'' is ambiguous. Contrary to the commenter's assertions, the 
cited portion of the Alabama Power opinion discusses a de minimis 
exemption only in the context of emission increases and not in terms of 
what constitutes a physical change (``EPA does have the discretion * * 
* to exempt from PSD review some emission increases on grounds of de 
minimis or administrative necessity''). Id.
    Moreover, the Alabama Power Court also expresses the expectation 
that ``bubbling'' (or netting) in calculating emission increases and an 
allowance for physical changes that result in de minimis increases in 
emissions ``will allow for improvement of plants, technological 
changes, and replacement of depreciated capital stock, without imposing 
a completely disabling administrative and regulatory burden.'' Alabama 
Power, 636 F.2d at 400. (emphasis added). Our subsequent experience has 
shown that, even with netting, a definition of ``physical change'' as 
encompassing as that supported by these commenters is inadequate to 
allow for appropriate replacement of depreciated capital stock. See 
``New Source Review: Report to the President'', June 2002 (Docket No. 
OAR-2002-0068, Document No. 0004). It simply is not the case that the 
Alabama Power opinion analyzes and requires the commenters' 
encompassing construction of ``any physical change.'' Equally 
important, a narrow interpretation of ERP as advocated by commenters 
would create hurdles for ensuring that a process operates reliably, 
safely, and efficiently, thereby increasing the likelihood that net 
emissions would be higher.

[[Page 33841]]

    The commenters point to several enforcement filings and other EPA 
pronouncements prior to promulgation of the ERP in which we said the 
definition of modification was unambiguous and had broad application. 
Furthermore, they note that we repeatedly recognized that the structure 
of the Act demonstrates that Congress intended grandfathering to be of 
limited duration.
    We recognize that, prior to promulgation of the ERP, we had not 
specifically asserted that our interpretation of ``change'' and the 
exclusions from NSR are based on an exercise of Chevron discretion. In 
some instances, such as in a decision of the Environmental Appeals 
Board (EAB), In re: Tennessee Valley Authority, 9 E.A.D. 357 (EAB 
2000), and in briefs in various enforcement-related cases, we had 
interpreted ``change'' such that virtually all changes, even trivial 
ones, were encompassed by the Act. Thus, we generally had interpreted 
the exclusion as being limited to de minimis circumstances. However, in 
the ERP we asserted that EPA does have the authority to interpret these 
key terms through rulemaking. Upon further consideration of the history 
of our actions, the statute, and its legislative history, we said that 
we believe a different view is permissible, and, for policy reasons 
discussed in the ERP final rule, more appropriate. Therefore, we 
adopted our Chevron-based interpretation of the statute prospectively 
in the ERP final rule.\6\
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    \6\ We noted in the ERP final rule: We have taken positions in 
numerous court filings concerning the proper interpretation and 
usage of key statutory terms, such as ``physical change'' and ``any 
physical change.'' These positions were based on permissible 
constructions of the statute of which the regulated community had 
fair notice, and correctly reflect the Agency's reasonable 
accommodation of the Clean Air Act's competing policies in light of 
its experience at the time it adopted the RMRR exclusion in 1980. 
The Agency has sought, and has obtained, deference for its 
interpretations, and, notwithstanding today's adoption of a revised 
interpretation of the statute and an expansion of the RMRR 
exclusion, the Agency shall continue to seek deference for those 
prior interpretations in ongoing enforcement litigation. 68 FR at 
61272, fn 14.
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    Subsequent to promulgating the ERP, we filed court papers noting 
that, as of the date of the final ERP rule, we adopted a new 
interpretation of the statute. Our position is most clearly spelled out 
in a filing we made in United States v. Illinois Power Co., et al., 
Civil Action No. 99-833 (S.D. Ill.) (``Illinois Power''). As we stated 
to the Illinois Power Court, ``the United States does not rely on any 
prior statements * * * that a very narrow construction of the ``routine 
maintenance'' exemption is required by the Clean Air Act itself. 
Instead, the United States will continue to rely on EPA's narrow 
interpretation of its prior ``routine maintenance'' exception, which 
remains applicable to this action.'' Illinois Power, Plaintiff's Reply 
to Defendants' Proposed Findings of Fact and Conclusions of Law 
(Liability Phase) at 5. We no longer interpret the language or 
structure of the NSR provisions of the Act as an expression of 
Congress's intent to limit ``grandfathering'' through the indirect 
means of the ``modification'' provision rather than through other 
provisions that clearly can reach all existing sources. See, e.g., CAA 
section 110 (SIP provisions); CAA section 112 (hazardous air pollutant 
provisions); CAA sections 401-416 (acid rain provisions).
    Finally, one group of commenters argues that Congress's decision in 
1977 to cross-reference the preexisting definition of ``modification'' 
in CAA section 111(a)(4) when it adopted the modification provision for 
NSR should have no impact on assessing whether the terms of the 
definition are ambiguous. They cite EPA's arguments in our August 2004 
brief in State of New York v. EPA, D.C. Cir. Case No. 02-1387, which 
refuted arguments that EPA is compelled to interpret both the NSPS and 
the NSR modification provisions the same way. They construe the ``legal 
basis'' discussion in our October 27, 2003, ERP final rule as arguing 
that Congress ratified our ERP interpretation when it enacted the 1977 
amendments.
    We disagree with the characterization of our argument in the 
October 27, 2003 preamble to the final ERP rule. Nowhere in that notice 
do we argue that Congress mandated adoption of the 1977 NSPS regulatory 
interpretation of what is a ``modification'' when it cross-referenced 
the definition in CAA 111(a)(4) into the NSR program. As we discussed 
in the cited passages of our briefs, we do not believe Congress 
intended to ratify the then-existing interpretation or ``congeal'' our 
NSR regulations as they stood under the NSPS program in 1977. Our 
discussion of the history of our interpretation of CAA 111(a)(4) simply 
points out the obvious: that words of CAA 111(a)(4) historically have 
been taken to have quite different meanings in the NSR and NSPS 
programs. From this, we argue that any words that can be given such 
divergent meanings for decades cannot have but one clear meaning on 
their face. To argue that the definition of ``modification'' in CAA 
111(a)(4) is unambiguous, as the commenters have, one must advance an 
unusual position: that the same words, with no further definitions or 
legislative history, facially and unambiguously mean different things.
    b. Textual analysis of the modification definition. It is axiomatic 
that the most clear expression of what Congress intended by the 
``modification'' definition is in the words it chose to use. Many 
significant comments we received analyzed the structure of the 
definition and particular words and phrases in it.
    One commenter argued that the statutory term ``modification'' 
itself is not ambiguous, so the definition of modification should not 
be read to create ambiguity in the term. The commenter, who argued that 
the ERP is too generous in excluding equipment replacements from NSR, 
observed that the plain meaning of modification connotes moderate, as 
opposed to fundamental, change.
    We disagree with the assertion that the ERP allows for 
``fundamental'' change in an emission source. In focusing on the 20 
percent criterion of the ERP, the commenter ignores other important 
criteria under the ERP that would, in any ordinary sense of the term, 
prohibit the possibility of fundamental change as a result of 
activities that meet the ERP exclusion. A source that maintains its 
basic design parameters is not fundamentally changed, nor is a source 
that replaces one piece of equipment with another that is functionally 
equivalent. Thus, the ERP does not allow for fundamental change of the 
type the commenter suggests that the term ``modification'' should 
prohibit. In fact, to clarify this, the ERP explicitly precludes 
activities that would change the basic design parameters from 
qualifying for a RMRR exclusion.
    Moreover, we disagree with the commenter's assertion that the term 
``modification'' itself is unambiguous and in no need of further 
clarification. In fact, we note that over the years permitting 
authorities have had to respond to numerous queries regarding whether 
certain activities constitute a ``modification,'' a testament that 
there is considerable ambiguity surrounding this term. Apparently, 
Congress agrees with our view, because it supplied further definition 
in CAA 111(a)(4).
    Many of the comments focused on the significance of the modifier 
``any'' in ``any physical change or change in the method of 
operation.'' In our October 27, 2003 final rule, we said that the word 
``any'' did not compel EPA to define what constitutes a ``physical 
change'' to include all activities that could conceivably be defined as 
a physical change. In our view, we had discretion to define what 
activities were

[[Page 33842]]

physical changes, and once we defined physical change, ``any'' simply 
meant that any activity that met our definition of physical change 
could be a modification if it also increased net emissions.
    In our July 1, 2004 notice, we invited comment on a recent Supreme 
Court case that construed a prohibition on states and localities 
enacting legislation to bar ``any entity'' from offering interstate 
telecommunications services to not apply to legislation that restrained 
political subdivisions of states from entering the field. Nixon v. 
Missouri Municipal League, 541 U.S. 125, 124 S. Ct. 1555, 1559-60 
(2004). The Nixon Court observed that Congress's understanding of 
``any'' can differ depending upon the statutory setting. Id. at 1561. 
This opinion reversed a case litigants had relied upon in seeking a 
stay of the ERP on the proposition for which it was cited.\7\
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    \7\ State and Municipal Petitioners' Emergency Motion for a 
Stay, State of New York v. EPA, D.C. Cir. No. 03-1380 and 
consolidated cases, at 8 fn.14 (citing Missouri Mun. League v. FCC, 
299 F.3d 949, 954 (8th Cir. 2002), rev'd sub nom. Nixon v. Missouri 
Mun. League, 541 U.S. 125, 124 S. Ct. 1555 (2004)). A copy of this 
motion was submitted to the record as a comment on the 
reconsideration notice.
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    In discussing the significance of the modifier ``any'' in the 
statute and in discussing the Nixon case, commenters opposed to the ERP 
argued that numerous cases besides Nixon have held that terms modified 
by the word ``any'' must be given the most inclusive meaning possible, 
that such terms must be interpreted expansively, and that ``any'' has a 
broad meaning.\8\ These commenters distinguished Nixon on the grounds 
that this case raised peculiar federalism concerns (i.e., the ability 
of a state to regulate its own political subdivisions) not present in 
CAA 111(a)(4) or the ERP.
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    \8\ E.g., Harrison v. PPG Industries, 446 U.S. 578 (1980); 
United States v. Gonzales, 520 U.S. 1 (1997); Department of HUD v. 
Rucker, 535 U.S. 125 (2002). A post-Nixon addition to this line of 
cases is Norfolk Southern Railway Co. v. James N. Kirby, Pty Ltd., 
125 S. Ct. 385 (2004).
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    Several other precedents establish that the principle on which 
Nixon relies, that the understanding of ``any'' can depend on the 
statutory context, is not limited to situations with federalism 
implications. E.g., O'Connor v. U.S., 479 U.S. 27, 31 (1986) (statutory 
context shows ``any taxes'' limited to taxes of the Republic of 
Panama); Mastro Plastics Corp. v. NLRB, 350 U.S. 270-85 (1956) (``any 
strike'' does not include strike in response to unfair labor 
practices); Bell Atlantic Tel. Cos. v. FCC, 131 F.3d 1044, 1047 (D.C. 
Cir. 1997) (FCC regulation narrowing ``any * * * facilities or 
services'' that a Bell operating company could offer affirmed when 
Court notes ``textual analysis is a language game played on a field 
known as `context'''). Therefore, we believe the ``broader frame of 
reference'' adopted by the Nixon Court is not an isolated and 
unsupported view of the law limited to cases raising federalism 
concerns.
    None of the cases cited by the commenters stand for the proposition 
that a term modified by the word ``any'' invariably must be given its 
broadest meaning. In Harrison and in other cases, the Court found ``no 
indication whatever'' that Congress intended a narrower or limited 
construction of statutory term. These cases discuss a different 
statutory context than the adoption of the definition of 
``modification'' in the NSR provisions of the CAA. These cases do not 
involve a situation in which Congress incorporated into a section of a 
statute a term that had been used in another section of the statute and 
which had been given a different meaning under that prior section. 
While there is no evidence that Congress compelled EPA to replicate its 
NSPS interpretation of ``any physical change'' in the NSR program, the 
fact that the words at issue were given a different construction in the 
NSPS is an indication that the words do not have a unique and, 
therefore, unambiguous meaning.
    The cases cited by the petitioners and the Nixon line of cases are 
not, in fact, opposing and contradictory. Both support looking for 
indications in the statute that suggest a more limited meaning of the 
modified term is possible or intended. We believe such indications 
exist in the NSR context because the modification definition inserted 
into the NSR provisions by a 1977 technical amendment to the 1977 CAA 
Amendments cross-referenced the pre-existing term under CAA 111(a)(4).
    Implicitly, at least one of the commenters critical of the ERP 
recognized that a broader frame of reference can apply by arguing that 
while in Nixon, a broad construction of ``any'' would have led to 
absurd, futile, and farfetched results, the same would not be true for 
the NSR modification definition. For NSR, according to the commenters, 
Congress placed a clear limit on what changes must be considered 
modifications--those that increase emissions.
    In the definition of ``modification,'' we believe a view that 
``any'' compels a broad construction of the modified terms also has 
farfetched implications. The same word ``any'' that modifies ``physical 
change in'' also modifies ``change in the method of operation of.'' The 
commenters' argument proves too much. The argument would say that 
exemptions from the definition of modification on any basis other than 
de minimis increases would not be necessary or appropriate, even long 
accepted ones that limit the scope of ``change in the method of 
operation.'' As the preamble to the final rule notes, many of these 
exemptions can result in non-de minimis increases in emissions. 68 FR 
at 61272. To accept the commenter's argument would mean that one word 
(``change'') that modifies two clauses in a definition compels a broad 
construction of one modified clause while allowing discretion when it 
modifies the other clause.
    Another commenter picks up on Nixon's reliance on the doctrine of 
avoiding absurd or futile results and echoes the view that this 
doctrine would not apply in the context of the modification definition. 
In this commenter's view, EPA cannot claim that a broad construction of 
``any physical change'' would lead to absurd or futile results when we 
adopted such a broad construction of ``any physical change'' in the 
past and continue to seek deference for such an interpretation in 
ongoing enforcement litigation.
    We do not claim our prior interpretation is absurd or futile. The 
Agency claims that the use of the word ``any'' in the statute does not 
compel only our prior interpretation.
    We note that under the NSPS program, we interpreted CAA 111(a)(4) 
to allow us to exempt ``[m]aintenance, repair, and replacement which 
the Administrator determines to be routine for a source category.'' 40 
CFR 60.14(e)(1). In contrast, under the NSR program, historically we 
have interpreted the RMRR provision on a case-by-case basis, and we 
have not followed suit with the NSPS program in determining that the 
same activities are categorically exempt from RMRR. Thus, a 
modification that is categorically exempt under the NSPS could be 
potentially subject to NSR under our historical RMRR interpretation. It 
would be incongruous to argue that the identical statutory text 
incorporated into both the NSPS and the NSR provisions ``clearly'' 
could support only one meaning in the NSR context while it supports a 
different meaning in the NSPS context. Rather than saying CAA 111(a)(4) 
is clear but has two distinct meanings, common sense suggests the 
wording is ambiguous and allows for an expert agency to adopt 
reasonable interpretations in the context of the programs.
    Commenters incorrectly claim that we have recognized all equipment 
replacements, including ``like-kind''

[[Page 33843]]

replacements, to be ``physical changes'' within the ordinary meaning of 
the word. While our October 27, 2003, final rule recognized that 
``change'' is susceptible to multiple meanings, and outlined many 
common uses of the word, we did so to illustrate that there is no one, 
unambiguous, common meaning for the word. That is the essence of 
ambiguity.
    Several commenters agreed with our view that ``any'' should be 
interpreted within the ``broader frame of reference'' of its statutory 
context. One commenter argued that Nixon undermined much of the logic 
in Wisconsin Electric Power Co. v. Reilly, 893 F.2d 901 (7th Cir. 1990) 
(WEPCO). That case contains sweeping language that repeatedly stressed 
that ``any'' compelled a broad interpretation of ``any physical 
change.''
    As we noted in our October 27, 2003 final rule, we believe that the 
WEPCO Court was correct to determine that the statute does not 
unambiguously allow all like-kind replacements to avoid NSR, which was 
the position advanced by WEPCO in that litigation and which is the 
position advanced in this reconsideration by certain commenters. The 
Court's conclusion that the statute does not compel the outcome favored 
by WEPCO leads to a result that is completely consistent with our 
current view. Additionally, we continue to believe that the activities 
at issue in WEPCO were not RMRR under the rules at issue in that case. 
Furthermore, we continue to believe that, under the ERP, the equipment 
replacements at issue in that case would not automatically qualify as 
being excluded from major NSR. However, we agree with the commenter 
that Nixon calls into question the additional discussion in WEPCO that 
construes ``any'' to compel a broad view of what is a ``physical 
change.'' In our view, ``any physical change'' is an ambiguous term 
that can be defined by the Agency through rulemaking.
    Focusing on a different portion of the definition of 
``modification,'' commenters argue that Congress provided the only 
acceptable limitation on what physical changes are not subject to NSR 
as a modification, which is the requirement that the physical change 
result in an increase in emissions of any pollutant or the emission of 
any pollutant not previously emitted.\9\ Commenters argue that an 
agency cannot imply an exemption to, or otherwise insert limiting 
language into, a categorical statutory provision, especially where 
Congress was specific in how it would allow the language to be limited.
---------------------------------------------------------------------------

    \9\ We note that it is to these limitations the Alabama Power 
Court said that we could establish de minimis increase levels.
---------------------------------------------------------------------------

    We disagree with the commenters on three grounds. First, the 
commenters seem to assume the answer to the threshold question--that 
equipment replacements that meet the ERP criteria are ``physical 
changes''--in order to say that we are creating an exemption for 
activity that is presumptively subject to NSR. We believe that there is 
no such presumption prior to the agency defining the ambiguous term. 
Second, we believe that the implication of the commenters' argument 
would mean that several long-accepted exemptions from NSR would no 
longer be valid were their position adopted. These exemptions from 
``any * * * change in the method of operations'' were discussed in our 
final rule legal basis. Finally, we believe that the commenters' 
argument would not give meaning to all the words of the definition of 
modification. The commenters' position reads the ``any physical change 
or change in the method of operation'' to be so inclusive that 
essentially the test for a modification becomes whether emissions 
increase at a source because there always will be some ``change'' to 
which the increase can be linked. In contrast, the ERP, as part of our 
overall approach to the definition of modification, gives meaning to 
both the ``change'' portion as well as the ``emissions increase'' 
portion of the definition.
    To summarize: With respect to existing sources, the purpose of the 
NSR provisions is simply to require the installation of controls at the 
appropriate and opportune time. The kind of replacements that 
automatically fall within the equipment replacement provision 
established today do not represent such an appropriate and opportune 
time. Accordingly, and given that it is consistent with the meaning of 
``change'' to treat this kind of replacement as not being a ``change,'' 
we believe excluding them on that basis from the definition of 
``modification'' as used in the NSR program is well calculated to serve 
all of the policies of the NSR provisions of the CAA, and is therefore 
a legitimate exercise of our discretion under Chevron, U.S.A. Inc. v. 
NRDC, 467 U.S. 837 (1984), to construe an ambiguous term. Likewise, we 
believe this approach is consistent with the holding in the WEPCO case, 
and with some though not all of that case's reasoning.
    Finally, one comment argued that EPA's position on the meaning of 
``change'' is internally inconsistent. If equipment replacement is not 
a change, then the comment suggests EPA lacks authority to regulate 
changes that exceed 20 percent of the replacement cost. If equipment 
replacement is a change, then the comment suggests that an exemption 
can only be justified by de minimis authority.
    We note that establishing bright line criteria in a manner that 
reduces regulatory cost and provide certainty is a well-recognized and 
accepted approach to clarifying ambiguous terms in statutes. See Time 
Warner Entertainment Co. LP v. FCC, 240 F.3d 1126, 1141 (D.C. Cir. 
2001). The ERP simply establishes bright lines for when an equipment 
replacement activity is automatically excluded from major NSR.
    As we explained in our final ERP rule preamble, this approach is 
consistent with our approach towards ``reconstruction'' in the NSPS 
context. Under the NSPS rules, we treat a 50 percent threshold as a 
trigger for scrutiny as to whether the source must meet the NSPS. 40 
CFR 60.15(b)(1). We then assess the technological and economic 
feasibility of meeting the NSPS standard. 40 CFR 60.15(b)(2).
    In the ERP, we do not take the position that all like-kind or 
functionally-equivalent replacements automatically are or are not 
changes. Instead, we simply draw criteria for when such activities are 
excluded from NSR and when the multi-factor RMRR approach applies.
    c. Policy objections. Several comments disputed the manner in which 
we exercised our discretion in defining which equipment replacement 
activities are not changes. As noted below, these comments tended to 
infer that we were defeating Congressional intent through the practical 
effects of the ERP.
    Some commenters criticize the ERP as allowing for perpetual 
immunity from emissions control requirements. These commenters claim 
that the ERP reflects EPA's disagreement with Congress's determination 
that the time to install controls is when a unit is modified. In the 
commenters' opinion, EPA's belief that it is not plausible that 
replacements would proceed if emissions controls needed to be installed 
lacks a factual basis and is contrary to the statutory scheme.
    Our disagreement over what constitutes a modification is with the 
commenter and not Congress. Major source NSR permitting is required 
unless the source can meet the criteria of the ERP, is not otherwise 
exempt under the RMRR provision or another NSR exemption or exclusion, 
and the source does not accept enforceable

[[Page 33844]]

emissions limit below the significant emissions increase levels. When a 
replacement is a modification under our clearer, more focused 
definition, NSR permitting will apply, consistent with the Act.
    We do not believe, however, the modification provisions of the CAA 
should be interpreted to ensure that all major facilities either must 
eventually trigger NSR or must degrade in performance, safety, and 
reliability. In fact, such an interpretation cannot be squared with the 
plain language of the CAA. An existing source triggers NSR only if it 
makes a physical or operational change that results in an emissions 
increase. Thus, a facility can conceivably continue to operate 
indefinitely without triggering NSR--making as many physical or 
operational changes as it desires--as long as the changes do not result 
in emissions increases. This outcome is an unavoidable consequence of 
the plain statutory language and is at odds with the notion that 
Congress intended that every major source would eventually trigger NSR 
or otherwise fall into disrepair. Moreover, there is nothing in the 
legislative history of the 1977 Amendments, which created the NSR 
program, to suggest that Congress intended to force all then-existing 
sources to go through NSR. To the extent that some members of Congress 
expressed that view during the debate over the 1990 amendments, such 
statements are not probative of what Congress meant in 1977. Central 
Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A., 511 U.S. 
164, 185--86 (1994), and cases cited.
    To the extent that our preamble to the ERP final rule suggested 
that no replacements ever would take place if controls were required, 
we recognize that such a generalization is not established by the 
record, nor was it our intent to make such a sweeping statement. 
Nevertheless, the substantial body of testimony and studies in the 
record demonstrates that the vagueness of the RMRR provision operated 
as a substantial restraint on replacement activity even when such 
activity would result in safer, more efficient, more reliable processes 
that had the potential to lower emissions in the overall economy by 
displacing higher polluting production. See ``New Source Review: Report 
to the President'', June 2002 (Docket No. OAR-2002-0068, Document No. 
0004). Based on the record, we believe that an owner or operator of a 
source often has the financial incentive to repair existing equipment 
or artificially constrain production, rather than install emission 
controls. Therefore, as a general matter, the replacement of that 
equipment is not, in fact, an opportune time for the installation of 
such controls. It follows that a policy treating such replacements as 
an NSR trigger generally will not lead to the installation of controls. 
Rather, it will merely create incentives to make a plant less 
productive than its design capacity would allow it to be.
    These commenters also claim that Congress intended to strike a 
different balance between the nation's economic and environmental 
interests than that which the ERP strikes. They believe requiring 
emission controls on modified sources would facilitate economic growth 
and preserve air quality. They point out that the 1977 House Committee 
report noted, when the emissions impact of each new or modified plant 
is minimized, ``then more and bigger plants will be able to locate in 
the same area without serious air quality degradation.''
    We agree that we strike the balance between productive capacity of 
the nation and the protection of the environment differently than these 
commenters would. We disagree with the assertion that the balance we 
struck inappropriately weights either consideration. To the extent that 
Congress left discretion to anyone in striking such a balance, it is 
afforded to the Administrator and not to litigants. The record 
demonstrates that our approach, in concert with other CAA programs, is 
consistent with preserving clean air resources and improving air 
quality in areas that are not attaining the NAAQS as well as Congress's 
intentions written explicitly in Sec. 101(b)(1) to preserve the 
productive capacity of the nation's population and in Sec. 160(3) to 
balance economic and environmental concerns.
    When balancing the economic and environmental interests of the 
nation, we have also considered that there are many other systematic 
air programs that will not merely prevent emission increases from 
existing sources but even reduce emissions at sources we expect to use 
the ERP. In fact, the entire state implementation plan (SIP) program 
under Sec. 110(a) establishes a framework for systematic reduction of 
emissions from existing sources when such reductions are deemed 
necessary to meet or maintain the NAAQS. The CAA places primary 
responsibility on the States to achieve the emissions reductions needed 
to attain and maintain the NAAQS. Over the years, States have in fact 
achieved significant emissions reductions in furtherance of this 
obligation.
    To assist States, we have developed model market-based programs 
patterned after the successful Acid Rain provision in Title IV of the 
CAA. For example, EPA's recently issued ``Clean Air Interstate Rule 
(CAIR),'' will ensure, through States adopting a ``cap and trade'' or 
other program approach, that overall emissions from electric utilities 
throughout much of the Eastern part of the country will meet overall 
emission limits that are sharply below that which they emit today. CAIR 
ensures that, by 2015, SO2 and NOX emissions will 
be permanently reduced by 5.4 million tons and 2.0 million tons, 
respectively, over 2003 levels. Additional emission reductions will 
occur after 2015 when CAIR is fully implemented.
    There are other CAA programs, as well, that are specifically 
tailored to require emission reductions from existing utility and 
nonutility sources. These programs include the Maximum Achievable 
Control Technology (MACT) standards that apply to new and existing 
sources of air toxics and Control Technique Guidelines that provide 
guidance to states in determining Reasonably Available Control 
Technology (RACT) for sources in ozone nonattainment areas. All of 
these CAA measures will apply systematically to existing sources, and 
are unaffected by the applicability or non-applicability of any NSR 
exclusion, such as the RMRR exclusion and its further definition as set 
forth in the ERP. And, in appropriate circumstances, a State may seek 
to use CAA Section 126 to petition for additional controls on out-of-
state sources.
    Even in the absence of these other CAA programs, we note that the 
substitution effect of replacing deteriorating emission sources with 
well-maintained emission sources will generally reduce emissions per 
unit of output. The ERP itself should not materially affect demand in 
markets. Thus, to the extent individual sources will increase output 
(and emissions) following maintenance allowed by the ERP, output (and 
emissions) at other plants will decrease. Thus, we conclude that the 
ERP will not lead to an overall emission increase.
    In contrast to the CAA programs discussed above that systematically 
and efficiently obtain emission reductions, the NSR program for 
existing sources, as that program existed before the ERP, was applied 
in a scattershot manner, only triggered by ``modifications'' however 
defined on a case-by-case manner. Under NSR, emissions reductions can 
only be obtained in a ``catch-as-catch-can'' manner, and there never 
has been and never can be a date

[[Page 33845]]

certain by which all existing sources in an area of the country must 
comply with an emission cap or a NAAQS. Moreover, as fully explained in 
our recent brief filed in defense of the NSR Improvements Rule of 
December 31, 2002, the NSR program is not an emission reduction 
program. It is a program to limit emission increases resulting from 
physical and operational changes. Brief for Respondent at 73-75, State 
of New York v. U.S. EPA, No. 02-1387 & consolidated cases (D.C. Cir.) 
(``If Congress had intended to compel decreases in emissions, it would 
be irrational for the requirement to be triggered only when a facility, 
in fact, increases its emissions''). In light of the programs under the 
Act that systematically and efficiently allow for both reductions in 
emissions and firm caps on emissions, and the scattershot applicability 
and limited goals of NSR program with respect to existing sources, it 
was appropriate for us to strike the balance of economic and 
environmental interests in accordance with the CAA, as we did when we 
changed our method for implementing the modification definition in the 
NSR program.
    Commenters suggest that EPA's decision in promulgating the ERP is 
not entitled to deference because, in their view, it appears that 
Congress would not have sanctioned an interpretation that allows 
sources to conduct multi-million dollar refurbishment activities that 
increase emissions without triggering NSR. However, the record 
establishes that adoption of the ERP will not cause overall emissions 
to increase, while, at the same time, safety, efficiency, and 
reliability of plants will improve. Furthermore, improvements in 
safety, efficiency, and reliability improve environmental performance 
by minimizing the frequency of startup, shutdowns, and malfunctions. 
While the record contains some conflicting data and studies, Congress 
left the weighing of this information and the forming of policies based 
on this information to EPA as an expert agency. We considered the 
quality and validity of the submitted data and studies in developing 
our conclusions. Our decisions in this matter are entitled to deference 
under Chevron.
2. The 20 Percent Replacement Cost Threshold
    In the December 31, 2002 proposed rule, EPA solicited comments on 
the ERP approach. At that time, we sought input on a range of possible 
percentages of cost that could serve as one of the criteria that must 
be met to qualify for the RMRR exclusion from NSR. We asked for comment 
on percentages ranging up to 50 percent, the threshold for 
reconstruction under the New Source Performance Standards (NSPS) 
program. 67 FR at 80301.
    Under the ERP, a project must meet four separate requirements 
before it is automatically excluded from NSR pursuant to the ERP. The 
20 percent replacement cost threshold is but one of the four 
requirements. Thus, projects that meet the 20 percent threshold are not 
exempt from major NSR under the ERP if they do not meet the other 
necessary criteria in the final rule. These other criteria require that 
the replaced component: (1) Be identical or functionally equivalent; 
(2) does not alter the basic design parameters of the process unit; and 
(3) does not cause the process unit to exceed any emission limitation 
or operational limitation (that has the effect of constraining 
emissions) that applies to any component of the process unit and that 
is legally enforceable.
    Some commenters have asserted that an equipment replacement project 
would be excluded from NSR if it costs 20 percent or less of the 
replacement cost of a process unit. However, a replacement project must 
meet all four of the ERP criteria for the ERP to apply. Thus, only if 
the replaced component is (1) identical or functionally equivalent, (2) 
does not alter the basic design parameters of the process unit, and (3) 
does not cause the unit to exceed any emission or operational limit, 
will the 20 percent criterion be relevant. Of all of these qualifiers, 
including the 20 percent cost threshold, the key qualifier is that the 
equipment replacement is ``like-kind'' (i.e., identical or functionally 
equivalent). This criterion provides strong support for our 
determination and conclusion that where the ERP applies, the process 
unit has undergone ``no change'' as a result of the activity at issue. 
Thus, the 20 percent cost threshold serves primarily as an 
administrative threshold, by which activities that fall beneath 
threshold and which also meet the other rule criteria safeguards 
qualify automatically as RMRR, while those activities that meet the 
other criteria but are over the 20 percent cost threshold may still be 
RMRR, but only by applying the multi-factor RMRR approach.
    In the final ERP, we presented policy arguments and data analyses 
supporting 20 percent of replacement costs of a process unit as the 
threshold cost that would entitle an equipment replacement activity (or 
aggregation of activities) to qualify automatically as RMRR, if the 
other three criteria were met. See 68 FR 61255-61258. In short, we 
received a substantial amount of industry data--both from electric 
utilities and from other industry sectors--that supported a decision to 
set the threshold at 20 percent. These data show that many like-kind 
replacements occurring at facilities typically cost less than 20 
percent of the process unit's value and do not increase emissions. We 
also conducted case studies on a number of industries, analyzed the 
costs involved in the Wisconsin Electric Power Company v. Reilly 
(``WEPCO'') case (See 893 F.2d 901 (7th Cir. 1990)) and other relevant 
information, and provided a legal basis as to why 20 percent is a 
reasonable ERP cost threshold for equipment replacements across all 
industries. We also stipulated other rule criteria which must be met to 
qualify for the ERP. The ERP allows sources to know, with certainty, 
that RMRR can be conducted without delay in situations where the 20 
percent replacement cost criterion and other specified criteria are 
met.
    Petitioners asked EPA to reconsider the 20 percent cost threshold, 
and claimed that none of EPA's arguments supporting the threshold had 
appeared in the proposed rule. We granted reconsideration on this issue 
and solicited additional comment on the data, our analyses, and the 
policy considerations supporting the 20 percent threshold. We also 
invited comment on whether it is appropriate to consider approaches 
used by local governments in determining construction building code 
applicability when establishing criteria for RMRR determinations.
    Thus, our goal in selecting the cost threshold is not to create a 
bright line below which any activity is excluded solely based on its 
cost. Rather, the threshold is intended to operate in combination with 
the three other ERP criteria as a screen for determining when the 
multi-factor RMRR approach is applicable and when it is appropriate to 
automatically exclude an activity as RMRR based on satisfying the three 
non-cost ERP criteria. As discussed below, we continue to believe that 
20 percent is an appropriate threshold for this purpose. The available 
data indicate that the 20 percent threshold will effectively identify 
those more significant projects for which applying the multi-factor 
RMRR approach is prudent.
    Another important factor of the ERP is that related activities must 
be aggregated in the same way as they would have to be aggregated for 
other NSR applicability purposes. Under our current policy of 
aggregation, two or more replacement activities that occur

[[Page 33846]]

at different times are not automatically considered separate activities 
solely because they happen at different times. In the case of replacing 
an entire facility, it is not feasible that an owner or operator could 
successfully argue that multiple projects occurring one after the other 
are not related to one another and should not be aggregated for 
applicability purposes. These other rule criteria play an important 
part in determining what replacements can qualify for the ERP.
    Much of the comment on the 20 percent replacement value threshold 
focused on our use of six non-utility case studies that we believe 
support our selection of a 20 percent replacement value threshold. 
Though equipment replacement activities vary widely across industry 
sectors, the six industry sector studies (pulp and paper mills, 
automobile manufacturing, natural gas transmission, carbon black 
manufacturing, pharmaceutical manufacturing, and petroleum refining) 
indicated that equipment replacement activities of the type allowed 
under the ERP generally do not cause increases in actual emissions. 
Additionally, though the six studies address specific case examples 
from only a part of regulated industry, the data indicated that most 
typical replacement activities fall within the 20 percent threshold, 
and that some major replacement activities will cross the 20 percent 
threshold and be subject to the multi-factor RMRR approach.
    We received a number of comments through the reconsideration 
process that were supportive of the calculations performed in the case 
studies of the six industries. Many of these comments came from the 
trade groups representing industries that were analyzed in the case 
studies. These organizations--including the American Forest & Paper 
Association, Alliance of Automobile Manufacturers, National 
Petrochemical & Refiners Association, and Interstate Natural Gas 
Association of America--supported the analyses conducted and 
conclusions reached in the case studies for each of their industries. 
In some cases, these trade groups provided further amplification of 
their cost ranges for projects, which provided additional depth and 
support to the conclusions of the report. Other commenters stated that 
the case studies failed to provide sufficient data to support the 20 
percent cost threshold.
    We never claimed that the case studies encompassed all equipment 
replacement activities at these industries. Further, we recognize that 
the case studies do not justify exempting all ``routine'' equipment 
replacement activity in any one of the case study industries. As 
discussed elsewhere in this notice, activities falling below the 20 
percent replacement value threshold are not exempt under the ERP if 
they do not meet the other three criteria of the rule. It is important 
to note that the case studies were performed prior to decisions on the 
exact form and content of the final rule. If the studies had chosen a 
different set of assumptions (e.g., for costing of projects, or in 
defining the process unit), they may have identified additional 
equipment replacement projects exceeding 20 percent in cost. 
Furthermore, these studies showed industry-wide results, not plant-
specific determinations. Under the ERP, if a plant-specific replacement 
activity does not satisfy all four of the criteria that must be met to 
qualify for the RMRR exclusion, then the activity is subject to the 
multi-factor RMRR approach. The studies indicate that larger, less 
frequent maintenance activities could exceed the ERP cost threshold 
and, consequently, would be subject to the multi-factor RMRR 
approach.\10\ Thus, we do not believe there is a basis, nor did the 
petitioners provide one, that all equipment replacements in these 
industries would be exempt under a 20 percent cost threshold.
---------------------------------------------------------------------------

    \10\ As the Alliance of Automobile Manufacturers appointed out 
in their comment letter, despite the claims of the petitioners, the 
Abt Study did consider typical replacement project for their 
industry that exceeded the 20 percent cost threshold.
---------------------------------------------------------------------------

    We continue to believe that this information on other industrial 
sectors beyond electric utilities supports our 20 percent bright line 
test. In short, the case studies support our view that it is reasonable 
to assume that equipment replacement activities in the utility industry 
are similar enough to replacement practices in other industry, such 
that the 20 percent value determined for utilities is appropriate for 
industry as a whole.
    While most industry commenters agreed that the 20 percent threshold 
was adequate and reasonable and was well supported by available data, 
several industry commenters provided additional data as further support 
that the 20 percent threshold is appropriate. For example, Solar 
Turbines estimates for their products (turbines of 1 to 14 megawatts in 
capacity), a periodic refurbishing of the gas producer unit--normally 
performed every 4 years--would cost 6 to 14 percent of the replacement 
cost, depending on the extent of deterioration. The Gas Turbine 
Association noted that the restoration cost as a percentage of total 
equipment replacement cost varies significantly with turbine unit size. 
According to the Gas Turbine Association, one supplier estimated a 
range from 9 percent for a combined cycle system to over 20 percent for 
a simple cycle system. Other commenters--including the National 
Petrochemical & Refiners Association and the American Forest & Paper 
Association--further supported the 20 percent equipment replacement 
cost threshold providing lists of their plant maintenance activities, 
many of which were beneath 20 percent in cost, and explained why they 
felt that their listed projects are routine. We have evaluated the 
projects described by commenters and, assuming that they would meet all 
other criteria of the ERP, these projects would not be the types of 
activities that would be subject to the multi-factor RMRR approach.
    We should note, however, that by referring to these lists provided 
by industry, we are not categorically determining that these activities 
are RMRR. As we have explained above, the 20 percent threshold is only 
one part of the ERP. Therefore, each activity must be evaluated against 
not only the 20 percent cost threshold but also the other three rule 
criteria before making a determination that these activities are RMRR 
under the ERP.
    Comments filed by the State and Territorial Air Pollution Program 
Administrators (STAPPA) and the Association of Local Air Pollution 
Control Officials (ALAPCO) suggested that we reject the percent 
threshold approach and replace it with a list of RMRR activities, along 
with a list of projects that are not RMRR, for each major industrial 
sector. Prior to promulgating the ERP, we evaluated developing a list 
of activities that are considered RMRR as a component of an overall 
RMRR program. Although it was decided that we could develop a list for 
industry sectors for which we had ample amounts of information, we 
believe that there are too many activities in too many industries, and 
an excessive number of facility-specific particulars, to effectively 
improve major NSR implementation by creating such lists. We also were 
concerned that such lists would need to be updated often.
    We believe the ERP provides more clarity than does the multi-factor 
approach that permitting authorities employed in making past RMRR 
determinations. With the multi-factor RMRR approach, no ``bright 
lines'' were ever established, either through rule or guidance, to 
evaluate the factors (e.g., nature/extent, purpose, frequency and 
cost), which contributed to regulatory uncertainty. Conversely, to the 
greatest

[[Page 33847]]

extent possible, the ERP provides ``bright lines'' by specifying 
criteria that must be met to qualify as RMRR. Of course, even with the 
ERP, there will be times when a permitting authority must make judgment 
calls, such as over whether the process unit's basic design parameters 
will change as a result of the equipment replacement. However, we 
believe that the ERP will enable these sorts of decisions to be more 
limited to engineering judgments and, therefore, less contentious (and 
more uniform from jurisdiction-to-jurisdiction) than the decisions 
required under the multi-factor test.
    The EPA continues to believe that our basis for selection of the 20 
percent replacement cost of the process unit is not arbitrary and 
capricious, and that there is support in both the rulemaking record and 
preamble for the 20 percent replacement cost threshold. Considering all 
of this information, together with the additional supporting data 
provided by commenters in response to the reconsideration issues, we 
believe our decision to establish the cost threshold at 20 percent is 
strongly supported and persuades us that we have established the 
correct cost threshold for the ERP.
3. Revisions to the Format for Incorporating the PSD FIP Into State 
Plans
    As discussed above, the December 24, 2003 final rule revised the 
PSD provision in each state plan that lacked an approved state 
regulation concerning PSD. In lieu of an approved PSD SIP, each of 
these state plans contained a reference incorporating the relevant 
provisions of 40 CFR 52.21, the PSD FIP, that applied within the state. 
Prior to the December 24th rule, we incorporated the relevant 
paragraphs of 40 CFR 52.21 by referring to the range of paragraphs from 
the first paragraph incorporated to the last paragraph. This format 
required updates every time we added paragraphs to section 52.21. The 
December 24th rule adopted a different cross-referencing format--``40 
CFR 52.21 except paragraph (a)(1).'' Under the new format, the cross-
references would automatically update whenever new sections were added 
to the PSD FIP.
    We granted reconsideration and solicited comment on the issue of 
the new format and its ability to automatically update affected state 
plans whenever EPA modifies the PSD FIP. We did not receive comments in 
opposition of this new format and thus will not change it. We believe 
the automatic update function will eliminate paperwork delays and 
typographical errors associated with future updates to federal PSD 
requirements. It will reduce the potential for confusion when the PSD 
rules are updated and will ensure that the relevant federal provisions 
are included in updated PSD FIPs in a consistent and efficient manner.

B. Remaining Issues in Petitions for Reconsideration

    We denied two issues contained in petitioners' requests for 
reconsideration because they failed to meet the standard for 
reconsideration under section 307(d)(7)(B) of the CAA. Specifically, on 
these issues, the petitioners have failed to show: That it was 
impracticable to raise their objections during the comment period, or 
that the grounds for their objections arose after the close of the 
comment period; and/or that their concern is of central relevance to 
the outcome of the rule. We discuss our reasons for denying 
reconsideration in the Technical Support Document, which is available 
on our Web site at http://www.epa.gov/nsr. We have concluded that no 
clarifications to the underlying rules are warranted for these two 
remaining issues, as described below.
1. Petitioners' Claim That EPA Retroactively Applied the ERP
    Petitioners' claimed that EPA retroactively applied the ERP, citing 
an EPA official's announcement in November 2003 that the Agency would 
no longer pursue past RMRR violations if the cases had not been filed. 
In response, we are, and have been, pursuing all filed cases and will 
continue to file new cases as appropriate. Our decisions on which cases 
to file is guided by a myriad of factors, including available resources 
and environmental protection. We acknowledge that the ERP is stayed and 
not currently effective in any jurisdiction. We continue to request 
information and put violators on notice when they violate our rules and 
policies. We note that none of the ERP rule revisions apply to any 
changes that are the subject of existing enforcement actions that the 
Agency has brought and none constitute a defense thereto.
    As discussed in the final ERP preamble (68 FR 61263), according to 
the U.S. Supreme Court, an agency may not promulgate retroactive rules 
absent express congressional authority. See Bowen v. Georgetown Univ. 
Hosp., 488 U.S. 204, 208, 102 L. Ed. 2d 493, 109 S. Ct. 468 (1988). The 
CAA contains no such expressed grant of authority, and we do not intend 
by our actions today to create retroactive applicability to the ERP. 
The promulgated ERP applies only to conduct that occurs after the rule 
is effective.
2. Petitioners' Claim That EPA Cannot Modify a State's SIP Without a 
Finding of Deficiency
    Petitioners' opposed the provisions in our FIP rule published on 
December 24, 2003, stating that EPA doesn't have the authority to issue 
a FIP without a finding of deficiency or notice of such deficiency as 
required under section 110(k)(5), 42 U.S.C. 7410(k)(5). They noted 
that, in order to require a State to revise its SIP, the EPA must find 
that a SIP is ``inadequate to attain or maintain the relevant national 
ambient air quality standard, to mitigate adequately the interstate 
pollution described in section 7506a of this title or section 7511c of 
this title, or to otherwise comply with any requirement of this 
chapter.'' They further noted that EPA can only require a SIP revision 
upon the finding that a particular SIP is deficient.
    We are not issuing a new FIP. Rather, we are modifying an existing 
FIP. As such, the original findings of inadequacy of the plans for 
states subject to the PSD FIP continue to apply because these states 
never submitted an approvable PSD program in the first place, or have 
not submitted a revised program since EPA's disapproval of their 
earlier submission. Our longstanding procedure has been to incorporate 
Sec.  52.21 into the applicable implementation plan for a state where 
there is no approved, SIP-based, permitting program. In every PSD 
rulemaking since the program's inception, we have incorporated all 
provisions of the promulgated rules into the applicable implementation 
plan for a state where there is no approved, SIP-based, permitting 
program. (See 68 FR 11317-11318.) We again are taking these actions in 
the case of the December 24, 2003 rules.
    As a result, we fail to see how the petitioning states were not 
clearly on notice about our intentions for these portions of the rule. 
Thus, EPA believes states subject to the PSD FIP had adequate notice 
and opportunity for comment that EPA planned to amend the FIP citations 
to Sec.  52.21 to reflect any changes EPA made to Sec.  52.21 in the 
final NSR rule. Therefore, the petitioners have failed to meet the 
procedural requirement for reconsideration. Moreover, EPA does not 
believe it makes sense for states subject to the PSD FIP to have the 
option to pick what portions of the FIP should apply--these states are 
free to submit PSD programs for approval as SIP revisions if they wish 
to apply something other than Sec.  52.21 in its

[[Page 33848]]

entirety (although we are making no conclusion about the approvability 
of a program that does not include all the elements of Sec.  52.21 at 
this time). Therefore, even if the petitioners had been correct that a 
procedural error had occurred in this instance, the outcome would not 
have been of central relevance to the outcome of the rule.
    It is inherent in the regulatory nature of a FIP that we retain the 
authority to make appropriate changes to the Federal Program and that 
these changes will automatically apply in any jurisdiction in which the 
Federal FIP applies whether or not we delegate authority to a State to 
implement the PSD FIP. We believe that the ERP improves the ability of 
a State to ``attain or maintain the relevant NAAQS, or to mitigate 
adequately the interstate pollution transport.'' As noted in the 
preamble to the final ERP (68 FR 61255), nothing in the promulgated ERP 
would prevent a State or local program from imposing additional 
requirements necessary to meet Federal, State or local air quality 
goals.

IV. 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 the 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, EPA determined that 
this rule is a ``significant regulatory action'' within the meaning of 
the Executive Order. As such, EPA has submitted this action to OMB for 
review. Changes made in response to OMB suggestions or recommendations 
will be documented in the public record.

B. Paperwork Reduction Act

    The information collection requirements (ICR) for this rule have 
been prepared under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. 
The EPA has deferred submission of the ICR to Office of Management and 
Budget (OMB) pending judicial review of the ERP. An ICR document has 
been prepared by EPA (ICR No. 1230.14), and a copy may be obtained from 
Susan Auby, U.S. Environmental Protection Agency, Office of 
Environmental Information, Collection Strategies Division (2822T), 1200 
Pennsylvania Avenue, NW., Washington, DC 20460-0001, by e-mail at 
[email protected], or by calling (202) 566-1672. A copy may also be 
downloaded off the Internet at http://www.epa.gov/icr. The information 
requirements included in ICR No. 1230.14 are not enforceable until OMB 
approves them.
    The information that ICR No. 1230.14 covers is required for the 
submittal of a complete permit application for the construction or 
modification of all major new stationary sources of pollutants in 
attainment and nonattainment areas, as well as for applicable minor 
stationary sources of pollutants. This information collection is 
necessary for the proper performance of EPA's functions, has practical 
utility, and is not unnecessarily duplicative of information we 
otherwise can reasonably access. We have reduced, to the extent 
practicable and appropriate, the burden on persons providing the 
information to or for EPA. In fact, we feel that this rule will result 
in less burden on industry and reviewing authorities since it 
streamlines the process of determining whether a replacement activity 
is RMRR.
    However, according to ICR No. 1230.14, we do anticipate an initial 
increase in burden for reviewing authorities as a result of the rule 
changes, to account for revising state implementation plans to 
incorporate these rule changes. As discussed above, we expect those 
one-time expenditures to be limited to $580,000 for the estimated 112 
affected reviewing authorities. For the number of respondent reviewing 
authorities, the analysis uses the 112 reviewing authorities count used 
by other permitting ICR's for the one-time tasks (for example, SIP 
revisions).
    Burden means the total time, effort, or financial resources 
expended by persons to generate, maintain, retain, or disclose or 
provide information to or for a Federal agency. This includes the time 
needed to review instructions; develop, acquire, install, and utilize 
technology and systems for the purpose of responding to the information 
collection; adjust existing ways to comply with any previously 
applicable instructions and requirements; train personnel to respond to 
a collection of information; search existing data sources; complete and 
review the collection of information; and transmit or otherwise 
disclose the information.
    An agency may not conduct or sponsor, and a person is not required 
to respond to a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations in 40 CFR are listed in 40 CFR part 9. When this ICR is 
approved by OMB, the Agency will publish a technical amendment to 40 
CFR part 9 in the Federal Register to display the OMB control number 
for the approved information collection requirements contained in this 
final rule.

C. Regulatory Flexibility Act

    The EPA has determined that it is not necessary to prepare a 
regulatory flexibility analysis in connection with this final rule.
    For purposes of assessing the impacts of today's rule on small 
entities, small entity is defined as: (1) A small business as defined 
by the Small Business Administration's regulations at 13 CFR 121.201; 
(2) a small governmental jurisdiction that is a government of a city, 
county, town, school district or special district with a population of 
less than 50,000; and (3) a small organization that is any not-for-
profit enterprise which is independently owned and operated and is not 
dominant in its field.
    After considering the economic impacts of today's final rule on 
small entities, EPA has concluded that this action will not have a 
significant economic impact on a substantial number of small entities. 
In determining whether a rule has a significant economic impact on a 
substantial number of small entities, the impact of concern is any 
significant adverse economic impact on small entities, since the 
primary purpose of the regulatory flexibility analyses is to identify 
and address regulatory alternatives ``which minimize any significant 
economic impact of the proposed rule on small entities.'' 5 U.S.C. 603 
and 604. Thus, an agency may conclude that a rule will not have a 
significant economic impact on a substantial number of small entities 
if the rule relieves regulatory burden, or

[[Page 33849]]

otherwise has a positive economic effect on all of the small entities 
subject to the rule.
    We believe this final rule will reduce the regulatory burden 
associated with the major NSR program for all sources, including all 
small businesses, by improving the operational flexibility of owners 
and operators, improving the clarity of requirements, and providing 
alternatives that sources may take advantage of to further improve 
their operational flexibility. We have therefore concluded that today's 
final rule will relieve regulatory burden for all affected small 
entities.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub. 
L. 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, EPA 
generally must prepare a written statement, including a cost-benefit 
analysis, for proposed and final rules with ``Federal mandates'' that 
may result in expenditures to State, local, and tribal governments, in 
the aggregate, or to the private sector, of $100 million or more in any 
1 year. Before promulgating an EPA rule for which a written statement 
is needed, section 205 of the UMRA generally requires EPA to identify 
and consider a reasonable number of regulatory alternatives and adopt 
the least costly, most cost-effective or least burdensome alternative 
that achieves the objectives of the rule. The provisions of section 205 
do not apply when they are inconsistent with applicable law. Moreover, 
section 205 allows EPA to adopt an alternative other than the least 
costly, most cost-effective or least burdensome alternative if the 
Administrator publishes with the final rule an explanation as to why 
that alternative was not adopted. Before EPA establishes any regulatory 
requirements that may significantly or uniquely affect small 
governments, including tribal governments, it must have developed under 
section 203 of the UMRA a small government agency plan.
    The plan must provide for notifying potentially affected small 
governments, enabling officials of affected small governments to have 
meaningful and timely input in the development of EPA regulatory 
proposals with significant Federal intergovernmental mandates, and 
informing, educating, and advising small governments on compliance with 
the regulatory requirements.
    We have determined that today's rule does not contain a Federal 
mandate that may result in expenditures of $100 million or more for 
State, local, and tribal governments, in the aggregate, or the private 
sector in any 1 year. The change in this rule is expected to result in 
a small decrease in the burden imposed upon reviewing authorities in 
order for them to be included in the State's SIP, as well as other 
small increases in burden discussed under ``Paperwork Reduction Act.'' 
In addition, we believe this final rule will actually reduce the 
regulatory burden associated with the major NSR program by improving 
the operational flexibility of owners and operators, and improving the 
clarity of requirements. Thus, today's action is not subject to the 
requirements of sections 202 and 205 of the UMRA.
    For the same reasons stated above, we have determined that today's 
action contains no regulatory requirements that might significantly or 
uniquely affect small governments. Thus, today's action is not subject 
to the requirements of section 203 of the 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 
Executive Order to include regulations that 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.''
    This final 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 Executive Order 13132. Thus, Executive Order 13132 does 
not apply to this rule. Nonetheless, EPA did consult with 
representatives of state and local governments in developing this rule, 
through face-to-face consultations and through soliciting comment from 
State and local officials in our July 1, 2004 Federal Register notice.

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

    Executive Order 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.'' Today's final action does not 
have tribal implications as specified in Executive Order 13175. This 
action will benefit permitting authorities and the regulated community, 
including any major source owned by a tribal government or located in 
or near tribal land, by providing increased certainty as to making RMRR 
determinations within the NSR program. Thus, Executive Order 13175 does 
not apply to this action.

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

    Executive Order 13045, entitled ``Protection of Children from 
Environmental Health Risks and Safety Risks'' (62 FR 19885, April 23, 
1997), applies to any rule that: (1) is determined to be ``economically 
significant'' as defined under Executive Order 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, the Agency must 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.
    Today's action is not subject to the Executive Order because it is 
not economically significant as defined in Executive Order 12866, and 
because the Agency does not have reason to believe the environmental 
health or safety risks addressed by this action present a 
disproportionate risk to children. We believe that today's action as a 
whole will result in equal or better environmental protection than 
provided by earlier regulations, and do so in a more streamlined and 
effective manner. As a result, today's final rule is not expected to 
present a disproportionate environmental health or safety risk for 
children.

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

    Today's action is not a ``significant energy action'' as defined in 
Executive Order 13211, ``Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 
28355, May 22, 2001) because it is not likely to have a significant 
adverse

[[Page 33850]]

effect on the supply, distribution, or use of energy.
    Today's rule improves the ability of sources to maintain the 
reliability of production facilities, and effectively utilize and 
improve existing capacity.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Pub. L. No. 104-113, 12(d) (15 U.S.C. 272 note) 
directs EPA to use voluntary consensus standards in its regulatory 
activities unless to do so would be inconsistent with applicable law or 
otherwise impractical.
    Voluntary consensus standards are technical standards (for example, 
materials specifications, test methods, sampling procedures, and 
business practices) that are developed or adopted by voluntary 
consensus standards bodies. The NTTAA directs EPA to provide Congress, 
through OMB, explanations when the Agency decides not to use available 
and applicable voluntary consensus standards.
    Today's action does not involve technical standards. Therefore, EPA 
did not consider the use of any voluntary consensus standards.

J. Congressional Review Act

    The Congressional Review Act (CRA), 5 U.S.C. 801 et seq., as added 
by the Small Business Regulatory Enforcement Fairness Act of 1996, 
generally provides that before a rule may take effect, the agency 
promulgating the rule must submit a rule report, which includes a copy 
of the rule, to each House of the Congress and to the Comptroller 
General of the United States. Section 808 allows the issuing agency to 
make a rule effective sooner than otherwise provided by the CRA if the 
agency makes a good cause finding that notice and public procedure is 
impracticable, unnecessary or contrary to the public interest. This 
determination must be supported by a brief statement. 5 U.S.C. 808(2). 
As stated previously, EPA has made such a good cause finding, including 
the reasons therefor, and established an effective date of June 10, 
2005. EPA will submit a report containing this rule and other required 
information to the U.S. Senate, the U.S. House of Representatives, and 
the Comptroller General of the United States prior to publication of 
the rule in the Federal Register. This action is not a ``major rule'' 
as defined by 5 U.S.C. 804(2).

V. Statutory Authority

    The statutory authority for this action is provided by sections 
101, 111, 114, 116, 301, and 307 of the CAA as amended (42 U.S.C. 7401, 
7407, 7411, 7414, 7416, and 7601).

VI. Judicial Review

    Under section 307(b)(1) of the Act, the opportunity to file a 
petition for judicial review of the October 27, 2003 final rule or the 
December 24, 2003 final rule has passed. Judicial review of today's 
final action is available only by the filing of a petition for review 
in the U.S. Court of Appeals for the District of Columbia Circuit by 
August 9, 2005. Any such judicial review is limited to only those 
objections that are raised with reasonable specificity in timely 
comments. Under section 307(b)(2) of the Act, the requirements that are 
the subject of the October 27, 2003 and December 24, 2003 final rules 
and today's final action may not be challenged later in civil or 
criminal proceedings brought by us to enforce these requirements.

List of Subjects in 40 CFR Parts 51 and 52

    Environmental protection, Administrative practices and procedures, 
Air pollution control, Intergovernmental Relations, New source review, 
Prevention of significant deterioration, Routine maintenance, repair 
and replacement, Equipment replacement.

    Dated: June 6, 2005.
Stephen L. Johnson,
Administrator.
[FR Doc. 05-11546 Filed 6-9-05; 8:45 am]
BILLING CODE 6560-50-P