[Federal Register Volume 70, Number 122 (Monday, June 27, 2005)]
[Rules and Regulations]
[Pages 36845-36848]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-12665]



[[Page 36845]]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[R05-OAR-2004-OH-0003; FRL-7923-2]


Approval and Promulgation of State Implementation Plans; Ohio; 
Revised Oxides of Nitrogen (NOX) Regulation and Revised NOX Trading 
Rule

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: On June 28, 2004, Ohio submitted an oxides of nitrogen 
(NOX) State Implementation Plan (SIP) revision request to 
EPA which included amended rules in Ohio Administrative Code (OAC). The 
purpose of the SIP revision is to exclude from the NOX 
trading program carbon monoxide boilers associated with fluidized 
catalytic cracking units (FCCU). The revision also allocates additional 
NOX allowances to the overall budget and to the trading 
budget to correct a typographical error made in the original rule. 
Removal of the FCCU boilers from the NOX trading program is 
an option Ohio has elected to incorporate in its NOX SIP. 
The Ohio SIP revision addresses some minor corrections in the rules and 
also incorporates by reference specific elements of the NOX 
SIP Call. EPA is approving the Ohio request because the changes conform 
to EPA policy under the Clean Air Act. The collective emissions from 
these sources are small and the administrative burden, to the states 
and regulated entities, of controlling such sources is likely to be 
considerable. Inclusion of these small NOX sources in the 
NOX SIP Call control program would not be cost effective. 
EPA proposed approval of this SIP revision and published a direct final 
approval on January 19, 2005. We received adverse comments on the 
proposed rulemaking, and therefore withdrew the direct final rulemaking 
on March 14, 2005.

DATES: This rule is effective on July 27, 2005.

ADDRESSES: EPA has established an electronic docket at Regional 
Material in eDocket (RME) Docket ID No. R05-OAR-2004-OH-0003. All 
documents in the docket are listed in the RME index at http://docket.epa.gov/rmepub/, once in the system, select ``quick search,'' 
then key in the appropriate RME Docket identification number. Although 
listed in the index, some information is not publicly available, i.e., 
Confidential Business Information (CBI) or other information whose 
disclosure is restricted by statute. Certain other material, such as 
copyrighted material, is not placed on the Internet and will be 
publicly available only in hard copy form. Publicly available docket 
materials are available either electronically in RME or in hard copy at 
Environmental Protection Agency, Region 5, Air and Radiation Division, 
77 West Jackson Boulevard, Chicago, Illinois 60604. We recommend that 
you telephone John Paskevicz, Engineer, at (312) 886-6084, before 
visiting the Region 5 office. This EPA office is open from 8:30 AM to 
4:30 PM, Monday through Friday, excluding legal holidays.

FOR FURTHER INFORMATION CONTACT: John Paskevicz, Engineer, Criteria 
Pollutant Section, Air Programs Branch (AR-18J), EPA Region 5, 77 West 
Jackson Boulevard, Chicago, Illinois 60604, (312) 886-6084. 
[email protected].

SUPPLEMENTARY INFORMATION:

Table of Contents

I. General Information
II. Background
    A. What Is the Intent of Today's Final Rule?
    B. Who Is Affected by Today's Rule?
    C. What Changes Did Ohio Make to Its NOX SIP?
    D. How Does This Change Affect NOX Sources?
    E. What Opportunities Were Provided by Ohio for Public Input 
Into This Rule Change?
    F. Why Is EPA Approving This Revision?
III. What Public Comments Were Received and What Is EPA's Response?
IV. Final Action
V. Statutory and Executive Order Reviews

I. General Information

    On August 5, 2002, at 67 FR 50600, EPA published a completeness 
determination that the Ohio NOX SIP submittal contained all 
of the elements of a NOX plan required for review. On 
January 16, 2003, at 68 FR 2211, we published a direct final rule 
approving Ohio's submittal. This rule was withdrawn on March 17, 2003, 
at 68 FR 12590, before it became effective because EPA received an 
adverse comment on the flow control issue. On August 5, 2003, at 68 FR 
46089, having resolved the flow control issue, EPA approved Ohio's 
NOX State Implementation Plan (SIP), designed to reduce 
NOX emissions from major fuel burning sources during the 
ozone season. The Ohio NOX SIP specifically addressed 
emissions from sources named in Ohio Administrative Code (OAC) rules 
3745-14 appendices A and B. These 2 appendices identify sources by 
location and plant identification number, and list NOX 
allocations for each plant. Appendix B lists NOX allowance 
allocations for the ozone season for regulated non-electrical 
generating units (non-EGUs).
    Following the August 5, 2003 approval, EPA issued an NOX 
SIP Call applicability statement which clarifies inclusion of a 
specific NOX source category (carbon monoxide (CO) boilers) 
and gives States the option to include or exclude this source category 
of boilers in the trading program. These CO boilers are associated with 
fluidized catalytic cracking units (FCCU) found in oil refineries and 
used to combust, and thereby control, CO emissions and to produce steam 
for use at the refinery. NOX is produced by a refinery's 
FCCU and CO boiler and these emissions vent through the boiler stack. 
As fuel burning sources, these units could be included in the 
NOX trading program if the State so desired. The EPA 
applicability statement gives this option to the States.
    The Ohio NOX SIP Call inventory for non-EGUs includes 
some, but not all, FCCU-CO boilers. Two boilers were regulated at one 
refinery but not regulated at two similar FCCU-CO units at two other 
refineries. These inventory inconsistencies existed as well at other 
state inventories in NOX SIP Call states. Because of these 
inconsistencies from state to state, EPA developed its applicability 
statement to allow each state with one or more FCCU-CO boiler the 
option of determining whether all of its large FCCU-CO boilers are 
covered, or all of its large FCCU-CO boilers are not covered by the 
NOX SIP trading program. However, in this option, EPA does 
not intend to allow states to split this category of sources by 
including some, but not all, large FCCU-CO boilers in the trading 
program. To prevent splitting the category, EPA needed to provide an 
explanation as to how allowances would be addressed for states like 
Ohio, with some but not all FCCU-CO sources in the rule.

II. Background

A. What Is the Intent of Today's Final Rule?

    Today's final rule resolves the issue of applicability of Ohio's 
rule to certain fuel burning units. It is intended to give affected 
sources in Ohio a clear indication that CO boilers associated with 
fluidized catalytic cracking units (FCCU) at oil refineries are not 
subject to Ohio's NOX budget trading rule. This action 
excludes selected units from the NOX budget trading program 
and the monitoring requirements of the State rule, and clears up for 
owners of these sources the questions of whether or not

[[Page 36846]]

monitoring, record-keeping and reporting requirements are required for 
these sources.

B. Who Is Affected by Today's Rule?

    This rule revision affects all refineries in Ohio which have carbon 
monoxide boilers associated with fluidized catalytic cracking units. 
There are three refineries in Ohio which are affected by this rule 
change. However, since the beginning of the NOX trading 
program, all three refineries have been granted an exemption from the 
monitoring, recordkeeping and reporting requirements of the Ohio 
NOX budget rule and the requirements of the NOX 
SIP Call. The exemption was granted in writing by EPA and applied to 
specific units classified by the State as small units.

C. What Changes Did Ohio Make to Its NOX SIP?

    Ohio made a number of changes to the NOX rules as noted 
in Table I, below.

                                                     Table I
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                  Reference                                          Description of change
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3745-14-01(B)(2)(h).........................  Changed the definition of ``boiler'' to exclude CO boilers
                                               associated with combusting CO from fluidized catalytic crackers
                                               at petroleum refineries.
3745-14-01(D)(2)(c).........................  Made minor corrections to references within this section of the
                                               rule.
3745-14-01(G)...............................  This chapter was amended to add significant amounts of State EPA
                                               and Federal EPA materials through incorporation by reference
                                               (IBR). The text of the incorporated material is not included but
                                               the specific materials incorporated as they exist on the
                                               effective date of the State rule are made part of the regulations
                                               and are listed in detail in the revised rule. Items included as
                                               part of the IBR are: the Clean Air Act and specific sections of
                                               Title IV; specific elements of part 51, part 52, part 60, part
                                               72, and part 75 of the Code of Federal Regulations (CFR), and the
                                               Ohio EPA Weekly Review.
3745-14-03(B)(3)(a).........................  Made a minor correction to reference within this section of the
                                               rule.
3745-14-05(A)...............................  This is the section of the Ohio rule which identifies the total
                                               number of allowances in the State's trading budget. The exclusion
                                               of FCCU-CO boilers from the requirements of the NOX program
                                               changes both the total number of allowances and the number of
                                               allowances for regulated non-electric generating units listed in
                                               appendix B of the State's plan. Details regarding this change are
                                               found in the State's revised budget demonstration. The revised
                                               total trading program budget includes 49,460 NOX allowances. The
                                               revised number of NOX allowances, for non-electric generating
                                               units, is 4,030.
3745-14 Appendix B..........................  Appendix B is the list of regulated non-electric generating units
                                               subject to the 3745-14 NOX budget program. This revised appendix
                                               reflects the exclusion of FCCU-CO boilers from the trading
                                               program. And it also incorporates the 16 NOX allowances for
                                               Premcor's unit B026, a unit covered by the Ohio rule.
----------------------------------------------------------------------------------------------------------------

    The Ohio NOX plan revision was reviewed based on the 
elements set forth in Appendix V, 40 CFR part 51.
    The State's submittal included: a formal letter requesting approval 
of the rule revision; evidence of legal authority; evidence that the 
rules were adopted in the Ohio Code; a copy of the rule; evidence that 
Ohio followed the requirements of the State's administrative procedures 
act; copy of the public notice; evidence that a public hearing was 
held; and copy of public comments.
    The submittal included a revised budget demonstration, describing 
the changes to the Ohio NOX emission budget and the 
NOX trading budget. Following original EPA approval of the 
Ohio NOX plan, the State discovered that an existing unit at 
the Premcor Refinery in Lima, Ohio should have been included in the 
rules as a regulated unit but was not. It is included because the unit 
is classified by Ohio as a large unit subject to the Ohio rule. OEPA 
also discovered that the rules regulated two CO boilers associated with 
FCCU boilers at the Sunoco Refinery in Ohio and did not regulate two 
similar FCCU-CO boilers, one belonging to Premcor Refinery and one at 
BP Toledo Refinery. These corrections are made in the Ohio rule 
revision. Ohio also learned that EPA had given other States the option 
of regulating or not regulating similar FCCU-CO boilers, and moved to 
make these changes to its rules. On the basis of this information, Ohio 
initiated a change to its trading rules which were made effective on 
May 5, 2004.

D. How Does This Change Affect NOX Sources?

    CO boilers associated with fluidized catalytic cracking units at 
oil refineries are classified as small units and, therefore, not 
required to be part of the NOX trading program. This has 
significant effect on annual operating costs for monitoring and 
reporting for owners of these boilers. Allowances, made available in 
Ohio's original rule, are no longer available for these units, and 
potential income from the sale of emission reduction credits no longer 
exists. More importantly for the owners of the sources, because these 
units are not part of the trading program, there is no longer a 
requirement for these sources to monitor, record and report emissions 
of NOX for these units under 40 CFR part 75. This relieves 
the owners of these sources from the substantial burden and expenses 
associated with the monitoring requirements of the Ohio trading rule.

E. What Opportunities Were Provided by Ohio for Public Input Into This 
Rule Change?

    The Clean Air Act (Act) requires States to allow the public an 
opportunity to review and comment on any State's plan to implement 
provisions of the Act. Section 110(a)(1) of the Act states, ``Each 
State shall, after reasonable notice and public hearings, adopt and 
submit to the Administrator * * * a plan * * *''. Ohio provided 
reasonable notice and public input.
    Ohio's Revised Administrative Code states that the Director of the 
Ohio Environmental Protection Agency ``may conduct public hearings on 
any plan for the prevention, control, and abatement of air pollution 
that the director is required to submit to the Federal government.'' 
(Ohio Revised Code Chapter 3704.03, Powers of the director of 
environmental protection.) On October 21, 2003, Ohio advised the 
affected community of a proposed rulemaking and public hearing 
concerning Rules 3745-14-01, 3745-14-03, and 3745-14-05 of the Ohio 
Administrative Code. Notice was made available to the public and 
affected

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industries via Ohio EPA's Web site and by direct electronic mail to the 
State's list of interested parties. This notice announced a thirty-day 
comment period beginning October 21, 2003. Comments were received and 
the rule was revised in response to the comments and again made 
available on the State's Web site. A public hearing was held in 
Columbus on March 11, 2004, at which no comments were made, and no 
comments were received via either U.S. Mail or electronic mail.
    Ohio published a notice of adoption of amended rules, and in the 
notice offered its citizens, and affected industry, an opportunity to 
appeal the Ohio EPA Director's findings and orders, and again sent an 
announcement of this opportunity to the list of interested parties. No 
appeals were made. The revision was approved by the Director and became 
effective on May 5, 2004.

F. Why Is EPA Approving This Revision?

    EPA is approving this revision because it conforms with the intent 
of EPA's applicability statement regarding boilers associated with 
fluidized catalytic cracking units located at oil refineries. This 
applicability statement or policy is available from the EPA Clean Air 
Markets Division (CAMD). A copy of this policy is available at the 
following web link: http://www.epa.gov/airmarkets/fednox/boilerpolicy.pdf. The intent of the policy has been articulated in 
letters to all three sources in Ohio which are affected by the Ohio 
NOX rule.\1\ In anticipation of the pending changes to the 
Ohio trading rule, these sources petitioned EPA and Ohio to exempt 
specific units from the requirements of OAC 3745-14-01, the monitoring, 
recordkeeping and reporting requirement of the Ohio NOX 
trading rule.
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    \1\ For example, letter dated June 28, 2004, from Sam 
Napolitano, Director, Clean Air Markets Division, EPA to Mr. Allen 
R. Ellet, Air Quality Team Leader, BP Oil Company, Toledo Refinery, 
Toledo, Ohio. In this letter, EPA approves an extension to the 
deadline for compliance by the CO boiler with the monitoring, 
recordkeeping and reporting requirements of the Ohio NOX 
budget trading program.
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    Prior to the May 31, 2004 start of the trading program, EPA had 
already exempted these small sources from the monitoring requirements. 
The exemptions were based on requests from the sources, and were made 
with the understanding that Ohio, with guidance from EPA, would amend 
its rules to exempt these sources from monitoring, and submit the rules 
to EPA to formalize the revision to the Ohio NOX plan. EPA 
agreed with the exemptions because the units at these sources are 
considered small emitters and were not factored into the cost-
effectiveness determination in the development of the original EPA 
rule. 63 FR 57356, October 27, 1998. Also, many of these units which 
are classified as CO emission control equipment in some state 
inventories are not significant emitters of NOX. EPA did not 
intend these units to be included in the NOX trading program 
because the emissions from this category were relatively small (less 
than 1 ton per day) 63 FR 57356, October 27, 1998. Ohio corrected this 
applicability issue by revising the State rule to exempt these units 
from the requirements of the NOX program. EPA agrees with 
the State's revision.

III. What Public Comments Were Received and What Is EPA's Response?

    EPA received two documents commenting on the direct final rule 
pertaining to the Ohio NOX SIP Call revision published in 
the Federal Register on January 19, 2005, at 70 FR 2954 EPA noted in 
the proposed rule also published on January 19, 2005, at 70 FR 2992, 
that if EPA received written comments, the direct final rule will be 
withdrawn and all written public comments received during the comment 
period will be addressed in a subsequent final rule based on the 
proposed rule. EPA, in the proposed rule, invited any party interested 
in commenting on the action to do so within the time-frame noted in the 
proposed rule.
    Whenever EPA receives adverse comments on the rule, it is required 
to published a withdrawal of the direct final rule within 30-days from 
the date of the close of the comment period. In this instance the 
withdrawal of the direct final approval of the Ohio revised 
NOX rule was published on March 14, 2005, at 70 FR 12416, 
within the time period required by EPA procedures.
    In addition to the two written comments on this action, EPA 
received several telephone inquires regarding the revision to the Ohio 
NOX trading rule. However, these phone calls were not 
intended by the callers to comment on the rule changes, but conveyed 
questions regarding EPA procedures and timing of the subsequent final 
rule or action. EPA did not receive any written comments resulting from 
these phone calls, and therefore, the details of the content of these 
telephone inquires will not be addressed in this final rule.
    Two written comments were submitted addressing the direct final 
rule. One comment came from an anonymous citizen via the Federal 
eRulemaking Portal through the Regional Materials in eDocket (RME) 
identification number R05-OAR-2004-OH-0003, and one comment was 
received from Ohio Environmental Protection Agency (OEPA) via the U.S. 
Postal Service. Both of these comments are available for viewing by the 
public in the RME using the above noted identification number.
    The citizen comment notes that the commenter's daughter has asthma 
and expresses concern that the Social Security Administration 
terminated disability payments. The comment does not address EPA's 
proposed action on Ohio's NOX rules. Thus the comment 
provides no reason for EPA's final action to differ from its proposed 
action.
    The OEPA submitted a comment suggesting corrections to errors in 
the text of the approval in the direct final rule. We incorrectly 
included in the direct final rule a number of changes to the State's 
rule which had not yet been given public notice and comment in the 
State's rulemaking procedure. These errors are corrected in this final 
rule. The direct final rule also refers to a unit in the Ohio inventory 
which was misidentified by the State in its original submittal. These 
changes are reflected in the revised text and appear as requested by 
Ohio EPA in its comments on the direct final rule. The intent of this 
final rule remains the same as the previously published direct final 
rule. EPA agrees with Ohio and is approving the revision which exempts 
FCCU-CO boilers from requirements of the trading program.

IV. Final Action

    We are approving Ohio's revision to the State's NOX plan 
because it continues to meet the requirements of the EPA NOX 
trading program. The State's revision makes a minor adjustment in the 
overall trading budget which EPA had confirmed was approvable. EPA 
agreed with Ohio prior to the start of the 2004 ozone season that this 
change would be approved and that affected FCCU-CO boilers would not be 
required to implement NOX rule requirements as long as Ohio 
continued to make progress to change the rules. The rule changes 
affecting the definition of boiler and adjusting the budget became 
effective in the State on May 5, 2004. This adjustment in the budget 
was recognized by EPA as a necessary change to accommodate Ohio's 
change in the definition of ``boiler'' in the State rule. EPA is 
publishing this action as a final rule because it serves to implement 
the intent of the NOX SIP Call and EPA policy and improves 
operation of Ohio's NOX plan.

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V. Statutory and Executive Order Reviews

Executive Order 12866; Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
action is not a ``significant regulatory action'' and therefore is not 
subject to review by the Office of Management and Budget.

Executive Order 13211: Actions That Significantly Affect Energy Supply, 
Distribution, or Use

    For this reason, this action is also not subject to Executive Order 
13211, ``Actions Concerning Regulations That Significantly Affect 
Energy Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001).

Regulatory Flexibility Act

    This action merely approves state law as meeting federal 
requirements and imposes no additional requirements beyond those 
imposed by state law. Accordingly, the Administrator certifies that 
this rule will not have a significant economic impact on a substantial 
number of small entities under the Regulatory Flexibility Act (5 U.S.C. 
601 et seq.).

Unfunded Mandates Reform Act

    Because this rule approves pre-existing requirements under state 
law and does not impose any additional enforceable duty beyond that 
required by state law, it does not contain any unfunded mandate or 
significantly or uniquely affect small governments, as described in the 
Unfunded Mandates Reform Act of 1995 (Public Law 104-4).

Executive Order 13175 Consultation and Coordination with Indian Tribal 
Governments

    This rule also does not have tribal implications because it will 
not have a substantial direct effect on one or more Indian tribes, on 
the relationship between the Federal Government and Indian tribes, or 
on the distribution of power and responsibilities between the Federal 
Government and Indian tribes, as specified by Executive Order 13175 (65 
FR 67249, November 9, 2000).

Executive Order 13132 Federalism

    This action also does not have federalism implications because it 
does not have substantial direct effects on the States, on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government, as specified in Executive Order 13132 (64 FR 43255, August 
10, 1999). This action merely approves a state rule implementing a 
Federal standard, and does not alter the relationship or the 
distribution of power and responsibilities established in the Clean Air 
Act.

Executive Order 13045 Protection of Children from Environmental Health 
and Safety Risks

    This rule also is not subject to Executive Order 13045 ``Protection 
of Children from Environmental Health Risks and Safety Risks'' (62 FR 
19885, April 23, 1997), because it is not economically significant.

National Technology Transfer Advancement Act

    In reviewing plan submissions, EPA's role is to approve state 
choices, provided that they meet the criteria of the Clean Air Act. In 
this context, in the absence of a prior existing requirement for the 
State to use voluntary consensus standards (VCS), EPA has no authority 
to disapprove a SIP submission for failure to use VCS. It would thus be 
inconsistent with applicable law for EPA, when it reviews a SIP 
submission, to use VCS in place of a plan submission that otherwise 
satisfies the provisions of the Clean Air Act. Thus, the requirements 
of section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (15 U.S.C. 272 note) do not apply.

Paperwork Reduction Act

    This rule does not impose an information collection burden under 
the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 
et seq.).

Congressional Review Act

    The Congressional Review Act, 5 U.S.C. section 801 et seq., as 
added by the Small Business Regulatory Enforcement Fairness Act of 
1996, generally provides that before a rule may take effect, the agency 
promulgating the rule must submit a rule report, which includes a copy 
of the rule, to each House of the Congress and to the Comptroller 
General of the United States. EPA will submit a report containing this 
rule and other required information to the U.S. Senate, the U.S. House 
of Representatives, and the Comptroller General of the United States 
prior to publication of the rule in the Federal Register. A major rule 
cannot take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2).
    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the appropriate circuit by August 26, 2005. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect the finality of this rule for the purposes of judicial 
review nor does it extend the time within which a petition for judicial 
review may be filed, and shall not postpone the effectiveness of such 
rule or action. This action may not be challenged later in proceedings 
to enforce its requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by 
reference, Intergovernmental relations, Oxides of nitrogen, Reporting 
and recordkeeping requirements.

    Dated: May 19, 2005.
Richard C Karl,
Acting Regional Administrator, Region 5.

0
For the reasons stated in the preamble, part 52, Chapter I, title 40 of 
the code of Federal Regulations is amended as follows:

PART 52--[AMENDED]

0
1. The authority citation for part 52 continues to read as follows:

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

Subpart KK--Ohio

0
2. Section 52.1870 is amended by adding paragraph (c)(132) to read as 
follows:


Sec.  52.1870  Identification of plan.

* * * * *
    (c) * * *
    (132) On June 28, 2004, the Ohio Environmental Protection Agency 
submitted revisions to OAC rule 3745-14-01. These revisions change the 
definition of ``boiler'' by excluding from the trading program carbon 
monoxide (CO) boilers associated with combusting CO from fluidized 
catalytic cracking units at petroleum refineries. The submittal also 
includes revisions to OAC rule 3745-14-03 (A housekeeping correction to 
reference OAC Chapter 3745-77 concerning Title V operating permit) and 
3745-14-05 (Revising the number of trading program budget allowances 
and source identification for the ozone seasons 2004 through 2007).
    (i) Incorporation by reference.
    (A) Ohio Administrative Code rules 3745-14-01, 3745-14-03, and 
3745-14-05, effective May 25, 2004.

[FR Doc. 05-12665 Filed 6-24-05; 8:45 am]
BILLING CODE 6560-50-P