[Federal Register Volume 72, Number 79 (Wednesday, April 25, 2007)]
[Rules and Regulations]
[Pages 20586-20667]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-6347]



[[Page 20585]]

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Part II





Environmental Protection Agency





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40 CFR Part 51



Clean Air Fine Particle Implementation Rule; Final Rule



Agency Information Collection Activities: Proposed Collection; Comment 
Request; PM2.5 Ozone National Ambient Air Quality Standard 
Implementation Rule; EPA ICR No. 2258.01; Notice

  Federal Register / Vol. 72, No. 79 / Wednesday, April 25, 2007 / 
Rules and Regulations  

[[Page 20586]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 51

[EPA-HQ-OAR-2003-0062; FRL-8295-2]
RIN 2060-AK74


Clean Air Fine Particle Implementation Rule

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: This final action provides rules and guidance on the Clean Air 
Act (CAA) requirements for State and Tribal plans to implement the 1997 
fine particle (PM2.5) national ambient air quality standards 
(NAAQS). Fine particles and precursor pollutants are emitted by a wide 
range of sources, including power plants, cars, trucks, industrial 
sources, and other burning or combustion-related activities. Health 
effects that have been associated with exposure to PM2.5 
include premature death, aggravation of heart and lung disease, and 
asthma attacks. Those particularly sensitive to PM2.5 
exposure include older adults, people with heart and lung disease, and 
children.
    Air quality designations became effective on April 5, 2005 for 39 
areas (with a total population of 90 million) that were not attaining 
the 1997 PM2.5 standards. By April 5, 2008, each State 
having a nonattainment area must submit to EPA an attainment 
demonstration and adopted regulations ensuring that the area will 
attain the standards as expeditiously as practicable, but no later than 
2015. This rule and preamble describe the requirements that States and 
Tribes must meet in their implementation plans for attainment of the 
1997 fine particle NAAQS. (Note that this rule does not include final 
PM2.5 requirements for the new source review (NSR) program; 
the final NSR rule will be issued at a later date.)

DATES: This rule is effective on May 29, 2007.

ADDRESSES: The EPA has established a docket for this action under 
Docket ID EPA-HQ-OAR-2003-0062. All documents relevant to this action 
are listed in the Federal docket management system at 
www.regulations.gov. Although listed in the index, some information is 
not publicly available (e.g. Confidential Business Information 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 through 
www.regulations.gov or in hard copy format at the EPA Docket Center, 
EPA/DC, EPA West, Room 3334, 1301 Constitution Avenue, NW., Washington, 
DC. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday 
through Friday, excluding legal holidays. The telephone number for the 
Public Reading Room is (202) 566-1744, and the telephone number for the 
Office of Air and Radiation Docket and Information Center is (202) 566-
1742. A variety of information and materials related to the fine 
particle NAAQS and implementation program are also available on EPA's 
Web site: http://www.epa.gov/air/particles.

FOR FURTHER INFORMATION CONTACT: For general information, contact Mr. 
Richard Damberg, U.S. Environmental Protection Agency, Office of Air 
Quality Planning and Standards, Mail Code C539-01, Research Triangle 
Park, NC 27711, phone number (919) 54l-5592 or by e-mail at: 
[email protected].

SUPPLEMENTARY INFORMATION:

General Information

A. Does this action apply to me?

    Entities potentially regulated by this action are State and local 
air quality agencies.

B. Where can I get a copy of this document and other related 
information?

    In addition to being available in the docket, an electronic copy of 
this final rule will also be available on the World Wide Web. Following 
signature by the EPA Administrator, a copy of this final rule will be 
posted at http://www.epa.gov/particles/actions.html.

C. How is the preamble organized?

I. Background
II. Elements of the Clean Air Fine Particle Implementation Rule
    A. Precursors and Pollutants Contributing to Fine Particle 
Formation
    B. No Classification System
    C. Due Dates and Basic Requirements for Attainment 
Demonstrations
    D. Attainment Dates
    E. Modeling and Attainment Demonstrations
    F. Reasonably Available Control Technology and Reasonably 
Available Control Measures
    G. Reasonable Further Progress
    H. Contingency Measures
    I. Transportation Conformity
    J. General Conformity
    K. Emission Inventory Requirements
    L. Condensable Particulate Matter Test Methods and Related Data 
Issues
    M. Improving Source Monitoring
    N. Guidance Specific to Tribes
    O. Enforcement and Compliance
    P. Emergency Episodes
    Q. Ambient Monitoring
III. 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 and Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect 
Energy Supply, Distribution, or Use
    I. National Technology Transfer Advancement Act
    J. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Congressional Review Act
    L. Petitions for Judicial Review
    M. Judicial Review
IV. Statutory Authority

I. Background

    Fine particles in the atmosphere are comprised of a complex mixture 
of components. Common constituents include: sulfate (SO4); 
nitrate (NO3); ammonium; elemental carbon; a great variety 
of organic compounds; and inorganic material (including metals, dust, 
sea salt, and other trace elements) generally referred to as 
``crustal'' material, although it may contain material from other 
sources. Airborne particles generally less than or equal to 2.5 
micrometers in diameter are considered to be ``fine particles'' (also 
referred to as PM2.5). (A micrometer is one-millionth of a 
meter, and 2.5 micrometers is less than one-seventh the average width 
of a human hair.) ``Primary'' particles are emitted directly into the 
air as a solid or liquid particle (e.g., elemental carbon from diesel 
engines or fire activities, or condensable organic particles from 
gasoline engines). ``Secondary'' particles (e.g., sulfate and nitrate) 
form in the atmosphere as a result of various chemical reactions. 
(Section II of the proposed rule included detailed technical discussion 
on PM2.5, its precursors, formation processes, and emissions 
sources.)
    The EPA established air quality standards for PM2.5 
based on evidence from numerous health studies demonstrating that 
serious health effects are associated with exposures to elevated levels 
of PM2.5. Epidemiological studies have shown statistically 
significant correlations between elevated PM2.5 levels and 
premature mortality. Other important

[[Page 20587]]

effects associated with PM2.5 exposure include aggravation 
of respiratory and cardiovascular disease (as indicated by increased 
hospital admissions, emergency room visits, absences from school or 
work, and restricted activity days), changes in lung function and 
increased respiratory symptoms, as well as new evidence for more subtle 
indicators of cardiovascular health. Individuals particularly sensitive 
to PM2.5 exposure include older adults, people with heart 
and lung disease, and children.
    On July 18, 1997, we revised the NAAQS for particulate matter (PM) 
to add new standards for fine particles, using PM2.5 as the 
indicator. We established health-based (primary) annual and 24-hour 
standards for PM2.5 (62 FR 38652).\1\ The annual standard 
was set at a level of 15 micrograms per cubic meter, as determined by 
the 3-year average of annual mean PM2.5 concentrations. The 
24-hour standard was set at a level of 65 micrograms per cubic meter, 
as determined by the 3-year average of the 98th percentile of 24-hour 
concentrations.
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    \1\ The original annual and daily standards for particles 
generally less than or equal to 10 micrometers in diameter (also 
referred to as PM10) were established in 1987. In the 
1997 PM NAAQS revision, EPA also revised the standards for 
PM10, but these revised PM10 standards were 
later vacated by the court, and the 1987 PM10 standards 
remained in effect. In the 2006 NAAQS revision, the 24-hour 
PM10 standard was retained but the annual standard was 
revoked. Today's implementation rule and guidance does not address 
PM10.
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    Attainment of the 1997 PM2.5 standards is estimated to 
lead to reductions in health impacts, including tens of thousands fewer 
premature deaths each year, thousands fewer hospital admissions and 
emergency room visits each year, hundreds of thousands fewer absences 
from work and school, and hundreds of thousands fewer respiratory 
illnesses in children annually. The EPA's evaluation of the science 
concluded that there was not sufficient information to either support 
or refute the existence of a threshold for health effects from PM 
exposure.\2\
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    \2\ Environmental Protection Agency. (2004a). Air Quality 
Criteria for Particulate Matter. Research Triangle Park, NC: 
National Center for Environmental Assessment--RTP, Office of 
Research and Development, U.S. Environmental Protection Agency, 
Research Triangle Park, NC 27711; report no. EPA/600/P-99/002aF and 
EPA/600/P-99/002bF. October 2004.
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    We subsequently completed in October 2006 another review of the 
NAAQS for PM. With regard to the primary standards, the 24-hour 
PM2.5 standard was strengthened to a level of 35 micrograms 
per cubic meter, based on the 3-year average of the 98th percentile of 
24-hour concentrations, and the level of the annual standard remained 
unchanged.\3\ Attainment of the 2006 PM2.5 standards is 
estimated to lead to additional reductions in health impacts, including 
approximately 1,200 to 13,000 fewer premature deaths each year, 1,630 
fewer hospital admissions and 1,200 fewer emergency room visits for 
asthma each year, 350,000 fewer absences from work and school, and 
155,300 fewer respiratory illnesses in children annually.\4\
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    \3\ The revised fine particle NAAQS were published on October 
17, 2006 (71 FR 61144). See EPA's Web site for additional 
information: http://www.epa.gov/pm/index.html.
    \4\ Regulatory Impact Analysis for Particulate Matter National 
Ambient Air Quality Standards (September 2006), page ES-8. The 
mortality range includes estimates based on the results of an expert 
elicitation study, along with published epidemiological studies.
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    In both 1997 and 2006 EPA established welfare-based (secondary) 
standards identical to the levels of the primary standards. The 
secondary standards are designed to protect against major environmental 
effects of PM2.5 such as visibility impairment, soiling, and 
materials damage. The EPA also established the regional haze 
regulations in 1999 for the improvement of visual air quality in 
national parks and wilderness areas across the country. Because 
regional haze is caused primarily by light scattering and light 
absorption by fine particles in the atmosphere, EPA is encouraging the 
States to integrate their efforts to attain the PM2.5 
standards with those efforts to establish reasonable progress goals and 
associated emission reduction strategies for the purposes of improving 
air quality in our treasured natural areas under the regional haze 
program.
    The scientific assessments used in the development of the 
PM2.5 standards included a scientific peer review and public 
comment process. We developed scientific background documents based on 
the review of hundreds of peer-reviewed scientific studies. The Clean 
Air Scientific Advisory Committee, a congressionally mandated group of 
independent scientific and technical experts, provided extensive review 
of these assessments, and found that EPA's review of the science 
provided an adequate basis for the EPA Administrator to make a 
decision. More detailed information on health effects of 
PM2.5 can be found on EPA's Web site at: http://www.epa.gov/air/urbanair/pm/index.html. Additional information on EPA's scientific 
assessment documents supporting the 1997 standards are available at 
http://www.epa.gov/ttn/oarpg/t1cd.html; additional scientific 
assessment information on the 2006 standards is available at: http://www.epa.gov/ttn/naaqs/standards/pm/s_pm_cr_cd.html.
    The EPA issued final PM2.5 designations for areas 
violating the 1997 standards on December 17, 2004. They were published 
in the Federal Register on January 5, 2005 (70 FR 944). On April 5, 
2005, EPA issued a supplemental notice which changed the designation 
status of eight areas from nonattainment to attainment based on newly 
updated 2002-2004 air quality data (70 FR 19844; published in the 
Federal Register on April 14, 2005). A total of 39 areas were 
designated as nonattainment for the 1997 PM2.5 standards. 
The population of these areas is estimated at about 90 million (or more 
than 30% of the U.S. population). Most of these areas only violate the 
annual standard, but a few violate both the annual and 24-hour 
standards.
    The nonattainment designation for an area starts the process 
whereby a State or Tribe must develop an implementation plan that 
includes, among other things, a demonstration showing how it will 
attain the ambient standards by the attainment dates required in the 
CAA. Under section 172(b), States have up to 3 years after EPA's final 
designations to submit their SIPs to EPA. These SIPs will be due on 
April 5, 2008, 3 years from the effective date of the designations.
    Section 172(a)(2) of the Act requires States to attain the 
standards as expeditiously as practicable but within 5 years of 
designation (i.e. attainment date of April 2010 based on air quality 
data for 2007-2009), or within up to 10 years of designation (i.e. to 
April 2015) if the EPA Administrator extends an area's attainment date 
by 1-5 years based upon the severity of the nonattainment problem or 
the feasibility of implementing control measures.
    Virtually all nonattainment problems appear to result from a 
combination of local emissions and transported emissions from upwind 
areas. The structure of the CAA requires EPA to develop national rules 
for certain types of sources which are also significant contributors to 
local air quality problems, including motor vehicles and fuels. It also 
provides for States to address emissions sources on an area-specific 
basis through such requirements as RACT, RACM, and RFP.
    We believe that to attain the PM2.5 standards, it is 
important to pursue emissions reductions simultaneously on the local, 
regional, and national levels. The EPA issued the Clean Air Interstate

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Rule (CAIR) \5\ on March 10, 2005 to address the interstate transport 
of sulfur dioxide and nitrogen oxide emissions primarily from power 
plants. Section 110 gives EPA the authority to require SIPs to 
``prohibit * * * any source or other type of emission activity within 
the State from emitting any air pollutant in amounts which will 
contribute significantly to nonattainment in, or interfere with 
maintenance by, any other State with respect to'' any NAAQS, and to 
prohibit sources or emission activities from emitting pollutants in 
amounts which will interfere with measures required to be included in 
State plans to prevent significant deterioration of air quality or to 
protect visibility (such as the protection of 156 mandatory Federal 
class I areas under the regional haze rule \6\). CAIR employs the same 
emissions trading approach used to achieve cost-effective emission 
reductions under the acid rain program. It outlines a two-phase program 
with increasingly tighter power plant emissions caps for 28 eastern 
states and the District of Columbia: SO2 caps of 3.6 million 
tons in 2010, and 2.5 million in 2015; NOX caps of 1.5 in 
2009 and 1.3 in 2015; and NOX ozone season caps of 580,000 
tons in 2009 and 480,000 tons in 2015. Emission caps are divided into 
State SO2 and NOX budgets. By the year 2015, the 
Clean Air Interstate Rule is estimated to result in:
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    \5\ See http://www.epa.gov/cair.
    \6\ See 64 FR 35714, July 1, 1999.

--$85 to $100 billion in annual health benefits, including preventing 
17,000 premature deaths, millions of lost work and school days, and 
tens of thousands of non-fatal heart attacks and hospital admissions 
annually.
--Nearly $2 billion in annual visibility benefits in southeastern 
national parks, such as Great Smoky and Shenandoah.
--Significant regional reductions in sulfur and nitrogen deposition, 
reducing the number of acidic lakes and streams in the eastern U.S.

    Over the past several years, EPA has also issued a number of 
regulations addressing emissions standards for new cars, trucks and 
buses. These standards are providing reductions in motor vehicle 
emissions of volatile organic compounds (VOCs, also referred to as 
hydrocarbons), NOX, and direct PM emissions (such as 
elemental carbon) as older vehicles are retired and replaced. Other 
existing rules are designed to reduce emissions from several categories 
of nonroad engines. The Tier 2 motor vehicle emission standards, 
together with the associated requirements to reduce sulfur in gasoline, 
are estimated to provide additional benefits nationally beginning in 
2004.\7\ When the new tailpipe and sulfur standards are fully 
implemented, Americans are estimated to benefit from the clean-air 
equivalent of removing 164 million cars from the road. These new 
standards require passenger vehicles to have emissions 77 to 95 percent 
cleaner than those on the road today and require fuel manufacturers to 
reduce the sulfur content of gasoline by up to 90 percent. In addition, 
the 2001 heavy-duty diesel engine regulations \8\ will lead to 
continued emissions reductions as older vehicles in that engine class 
are retired and fleets turn over. New emission standards began to take 
effect for model year 2007 and apply to heavy-duty highway engines and 
vehicles. These standards are based on the use of high-efficiency 
catalytic exhaust emission control devices or comparably effective 
advanced technologies. Because these devices are damaged by sulfur, the 
level of sulfur in highway diesel fuel was to be reduced by 97 percent 
by mid-2006. We project a 2.6 million ton reduction of NOX 
emissions in 2030 when the current heavy-duty vehicle fleet is 
completely replaced with newer heavy-duty vehicles that comply with 
these emission standards. By 2030, we estimate that this program will 
reduce annual emissions of hydrocarbons by 115,000 tons and PM by 
109,000 tons. These emissions reductions are on par with those that we 
anticipate from new passenger vehicles and low sulfur gasoline under 
the Tier 2 program.
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    \7\ See Tier II emission standards at 65 FR 6698, February 10, 
2000.
    \8\ See heavy-duty diesel engine regulations at 66 FR 5002, 
January 18, 2001.
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    The EPA also finalized national rules in May 2004 to reduce 
significantly PM2.5 and NOX emissions from 
nonroad diesel-powered equipment.\9\ These nonroad sources include 
construction, agricultural, and industrial equipment, and their 
emissions constitute an important fraction of the inventory for direct 
PM2.5 emissions (such as elemental carbon and organic 
carbon), and NOX. The EPA estimates that affected nonroad 
diesel engines currently account for about 44 percent of total diesel 
PM emissions and about 12 percent of total NOX emissions 
from mobile sources nationwide. These proportions are even higher in 
some urban areas. The diesel emission standards will reduce emissions 
from this category by more than 90 percent, and are similar to the 
onroad engine requirements implemented for highway trucks and buses. 
Because the emission control devices can be damaged by sulfur, EPA also 
established requirements to reduce the allowable level of sulfur in 
nonroad diesel fuel by more than 99 percent by 2010. In 2030, when the 
full inventory of older nonroad engines has been replaced, the nonroad 
diesel program will annually prevent up to 12,000 premature deaths, one 
million lost work days, 15,000 heart attacks and 6,000 children's 
asthma-related emergency room visits.
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    \9\ For more information on the proposed nonroad diesel engine 
standards, see EPA's Web site: http://www.epa.gov/nonroad/.
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    The EPA expects the implementation of regional and national 
emission reduction programs such as CAIR and the suite of mobile source 
rules described above to provide significant air quality improvements 
for PM2.5 nonattainment areas. At the same time, analyses 
for the final CAIR rule indicate that without implementation of local 
measures, a number of PM2.5 areas are projected to remain in 
nonattainment status in the 2010-2015 timeframe. Thus, EPA believes 
that local and State emission reduction efforts will need to play an 
important role in addressing the PM2.5 problem as well. The 
EPA will work closely with States, Tribes, and local governments to 
develop appropriate in-state pollution reduction measures to complement 
regional and national strategies to meet the standards expeditiously 
and in a cost-effective manner. States will need to evaluate 
technically and economically feasible emission reduction opportunities 
and determine which measures can be reasonably implemented in the near 
term. Local and regional emission reduction efforts should proceed 
concurrently and expeditiously.
    The promulgation of a revised 24-hour PM2.5 standard 
effective on December 18, 2006 has initiated another process of State 
recommendations, and the eventual designation by EPA of areas not 
attaining the revised standard. The additional designations are to be 
completed within two years from the effective date, although EPA may 
take an additional year to complete the designations if it determines 
it does not have sufficient information. State plans to attain the 24-
hour standard would then be due within three years of the final 
designations. A number of areas, including some that are already 
designated as not attaining the 1997 standards, may be exceeding the 
revised 24-hour standard. The EPA encourages State and local 
governments to be mindful of the strengthened 24-hour standard as they 
adopt emission reduction strategies to attain the 1997 standards. Such 
steps may help with

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future attainment efforts, or even help some areas avoid a 
nonattainment designation for the 24-hour standard in the first place.
    The public health benefits of meeting the PM2.5 
standards are estimated to be significant. Even small reductions in 
PM2.5 levels may have substantial health benefits on a 
population level. For example, in a moderate-sized metropolitan area 
with a design value of 15.5 [mu]g/m3, efforts to improve annual average 
air quality down to the level of the standard (15.0 [mu]g/m3) are 
estimated to result in as many as 25-50 fewer mortalities per year due 
to air pollution exposure. In a smaller city, the same air quality 
improvement from 15.5 to 15.0 [mu]g/m3 still are estimated to result in 
a number of avoided mortalities per year. These estimates are based on 
EPA's standard methodology for calculating health benefits as used in 
recent rulemakings.\10\ In addition, because many different precursors 
contribute to the formation of fine particles, reductions in pollutants 
that contribute to PM2.5 also can provide concurrent 
benefits in addressing a number of other air quality problems--such as 
ground-level ozone, regional haze, toxic air pollutants, and urban 
visibility impairment.
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    \10\ See: U.S. EPA 2006. Regulatory Impact Analysis for the 
Particulate Matter National Ambient Air Quality Standards. Air 
Benefits and Cost Group, Office of Air Quality Planning and 
Standards, Research Triangle Park, N.C. October 6, 2006. Appendix A 
provides an analysis of estimated benefits and costs of attaining 
the 1997 PM NAAQS standards in 2015.
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    In order to assist States in developing effective plans to address 
the local component of the PM2.5 nonattainment problem, EPA 
is issuing this final fine particle implementation rule. The EPA is 
issuing this rule to implement the 1997 PM2.5 NAAQS in 
accordance with the statutory requirements of the CAA set forth in 
Subpart 1 of Part D of Title 1, i.e., sections 171-179B of the Act. The 
EPA believes that the CAA directs the Agency to implement new or 
revised NAAQS in nonattainment areas solely in accordance with Subpart 
1, unless another Subpart of the Act also applies to the particular 
NAAQS at issue. In this case, EPA has concluded that Congress did not 
intend the Agency to implement particulate matter NAAQS other than 
those using PM10 as the indicator in accordance with Subpart 
4 of Part D of Title 1, i.e., sections 188-190 of the CAA. Moreover, 
EPA believes that implementation of the PM2.5 NAAQS under 
the provisions of Subpart 1 is more appropriate, given the inherent 
nature of the PM2.5 nonattainment problem. In contrast to 
PM10, EPA anticipates that achieving the NAAQS for 
PM2.5 will generally require States to evaluate different 
sources for controls, to consider controls of one or more precursors in 
addition to direct PM emissions, and to adopt different control 
strategies. As a result, EPA has concluded that the provisions of 
Subpart 1 will allow States and EPA to tailor attainment plans so that 
they can be based more specifically upon the facts and circumstances of 
each nonattainment area.
    The proposed clean air fine particle implementation rule was issued 
on November 1, 2005 (70 FR 65984). About 100 comments were received 
from private citizens and parties representing industry, state and 
local governments, environmental groups, and federal agencies. Section 
II of this document describes the primary elements of the fine particle 
implementation program. Each section summarizes the relevant policies 
and options discussed in the proposed rule, discusses the final policy 
set forth by EPA in the final rule, and provides responses to the major 
comments received on each issue.

II. Elements of the Clean Air Fine Particle Implementation Rule

A. Precursors and Pollutants Contributing to Fine Particle Formation

1. Introduction
    The main precursor gases associated with fine particle formation 
are SO2, NOX, volatile organic compounds (VOC), 
and ammonia. This section provides technical background on each 
precursor, discusses the policy approach for addressing each precursor 
under the PM2.5 implementation program, and responds to key 
issues raised in the public comment process. A subsection is also 
included on direct PM2.5 emissions to address key comments 
received on this issue as well.
    Gas-phase precursors SO2, NOX, VOC, and 
ammonia undergo chemical reactions in the atmosphere to form secondary 
particulate matter. Formation of secondary PM depends on numerous 
factors including the concentrations of precursors; the concentrations 
of other gaseous reactive species; atmospheric conditions including 
solar radiation, temperature, and relative humidity (RH); and the 
interactions of precursors with preexisting particles and with cloud or 
fog droplets. Several atmospheric aerosol species, such as ammonium 
nitrate and certain organic compounds, are semivolatile and are found 
in both gas and particle phases. Given the complexity of PM formation 
processes, new information from the scientific community continues to 
emerge to improve our understanding of the relationship between sources 
of PM precursors and secondary particle formation.
    As an initial matter, it is helpful to clarify the terminology we 
use throughout this notice to discuss precursors. We recognize 
NOX, SO2, VOCs, and ammonia as precursors of 
PM2.5 in the scientific sense because these pollutants can 
contribute to the formation of PM2.5 in the ambient air. In 
section II.K on emission inventory issues, we make the point that 
because of the complex and variable interaction of multiple pollutants 
and precursors in the formation of fine particles, it is important for 
States and EPA to continue to characterize and improve the emissions 
inventories for all PM2.5 precursors. The States and EPA 
need to use the best available information available in conducting air 
quality modeling and other assessments. At the same time, the 
refinement of emissions inventories, the overall contribution of 
different fine particle precursors to PM2.5 formation, and 
the efficacy of alternative potential control measures will vary by 
location. This requires that we further consider in this action how 
States should address these PM2.5 precursors in their 
PM2.5 attainment plan programs. Thus, we require emission 
inventories to include the best available information on all pollutants 
and precursors that contribute to PM2.5 concentrations, and 
at same time we use the term ``PM2.5 attainment plan 
precursor'' to describe only those precursors that are required to be 
evaluated for control strategies in a specific PM2.5 
nonattainment area or maintenance area plan.
    In this rule, EPA has not made a finding that all precursors should 
be evaluated for possible controls in each specific nonattainment area. 
The policy approach in the rule instead requires sulfur dioxide to be 
evaluated for control measures in all areas, and describes general 
presumptive policies for NOX, ammonia, and VOC for all 
nonattainment areas. The rule provides a mechanism by which the State 
and/or EPA can make an area-specific demonstration to reverse the 
general presumption for these three precursors. States must also 
consider any relevant information brought forward by interested parties 
in the SIP planning and development process. (See section II.A.8 for 
additional discussion on these issues.)
    In the following sections, we discuss how States must evaluate 
PM2.5 precursors for nonattainment program issues in 
PM2.5 implementation plans,

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including issues such as RACT, RACM, and reasonable further progress. 
This discussion in the final rule is linked to precursor policies for 
the implementation of the new source review program, the transportation 
conformity program, the general conformity program, and the regional 
haze program. All of these programs take effect prior to approval of 
SIPs for attaining the PM2.5 NAAQS. In the case of NSR, the 
program applies on the effective date of the nonattainment area 
designation. In the case of transportation conformity and general 
conformity, the program takes effect 1 year from the effective date of 
designation of the nonattainment area (i.e., April 5, 2006 for areas 
designated nonattainment effective April 5, 2005). Thus, for each of 
these programs there is an interim period between the date the program 
becomes applicable to a given nonattainment area and the date the State 
receives EPA approval of its overall PM2.5 implementation 
plan.
2. Legal Authority to Regulate Precursors
 a. Background
    The CAA authorizes the Agency to regulate criteria pollutant 
precursors. The term ``air pollutant'' is defined in section 302(g) to 
include ``any precursors to the formation of any air pollutant, to the 
extent the Administrator has identified such precursor or precursors 
for the particular purpose for which the term `air pollutant' is 
used.'' The first clause of this second sentence in section 302(g) 
explicitly authorizes the Administrator to identify and regulate 
precursors as air pollutants under other parts of the CAA. In addition, 
the second clause of the sentence indicates that the Administrator has 
discretion to identify which pollutants should be classified as 
precursors for particular regulatory purposes. Thus, we do not 
necessarily construe the CAA to require that EPA identify a particular 
precursor as an air pollutant for all regulatory purposes where it can 
be demonstrated that various CAA programs address different aspects of 
the air pollutant problem. Likewise, we do not interpret the CAA to 
require that EPA treat all precursors of a particular pollutant the 
same under any one program when there is a basis to distinguish between 
such precursors. For example, in a rule addressing PM2.5 
precursors for purposes of the transportation conformity program, we 
chose to adopt a different approach for one precursor based on the 
limited emissions of that precursor from onroad mobile sources and the 
degree to which it contributes to PM2.5 concentrations. (70 
FR 24280; May 6, 2005).
    Other provisions of the CAA reinforce our reading of section 302(g) 
that Congress intended precursors to NAAQS pollutants to be subject to 
the air quality planning and control requirements of the CAA, but also 
recognized that there may be circumstances where it is not appropriate 
to subject precursors to certain requirements of the CAA. Section 182 
of the CAA provides for the regulation of NOX and VOCs as 
precursors to ozone in ozone nonattainment areas, but also provides in 
section 182(f) that major stationary sources of NOX (an 
ozone precursor) are not subject to emission reductions controls for 
ozone where the State shows through modeling that NOX 
reductions do not decrease ozone. Section 189(e) provides for the 
regulation of PM10 precursors in PM10 
nonattainment areas, but also recognizes that there may be certain 
circumstances (e.g. if precursor emission sources do not significantly 
contribute to PM10 levels) where it is not appropriate to 
apply control requirements to PM10 precursors. The 
legislative history of Section 189(e) recognized the complexity behind 
the science of precursor transformation into PM10 ambient 
concentrations and the need to harmonize the regulation of 
PM10 precursors with other provisions of the CAA:

    The Committee notes that some of these precursors may well be 
controlled under other provisions of the CAA. The Committee intends 
that * * * the Administrator will develop models, mechanisms, and 
other methodology to assess the significance of the PM10 
precursors in improving air quality and reducing PM10. 
Additionally, the Administrator should consider the impact on ozone 
levels of PM10 precursor controls. The Committee expects 
the Administrator to harmonize the PM10 reduction 
objective of this section with other applicable regulations of this 
CAA regarding PM10 precursors, such as NOX. 
See H. Rpt. 101-490, Pt. 1, at 268 (May 17, 1990), reprinted in S. 
Prt. 103-38, Vol. II, at 3292.

    In summary, section 302(g) of the CAA clearly calls for the 
regulation of precursor pollutants, but the CAA also identifies 
circumstances when it may not be appropriate to regulate precursors and 
gives the Administrator discretion to determine how to address 
particular precursors under various programs required by the CAA. Due 
to the complexities associated with precursor emissions and their 
variability from location to location, we believe that in certain 
situations it may not be effective or appropriate to control a certain 
precursor under a particular regulatory program or for EPA to require 
similar control of a particular precursor in all areas of the country.
b. Final Rule
    The final rule maintains the same legal basis for regulating 
precursors as was described in the proposal and in the background 
section above. We also include a clarification of the term 
``significant contributor.''
    In the proposal, when considering the impacts of the precursors 
NOX, VOC and ammonia on ambient concentrations of 
particulate matter, we referred to the possibility of reversing the 
presumed approach for regulating or not regulating a precursor if it 
can be shown that the precursor in question is or is not a 
``significant contributor'' to PM2.5 concentrations within 
the specific nonattainment area. ``Significant contribution'' in this 
context is a different concept than that in Section 110(a)(2)(D). 
Section 110(a)(2)(D) prohibits States from emitting air pollutants in 
amounts which significantly contribute to nonattainment or other air 
quality problems in other states. Consistent with the discussion of 
sections 189(e) and 302(g) above, we are clarifying that the use in 
this implementation rule of the term ``significant contribution'' to 
the nonattainment area's PM2.5 concentration means that a 
significant change in emissions of the precursor from sources in the 
state would be projected to provide a significant change in 
PM2.5 concentrations in the nonattainment area. For example, 
if modeling indicates that a reduction in a state's NOX 
emissions would reduce ambient PM2.5 levels in the 
nonattainment area, but that a reduction in ammonia emissions would 
result in virtually no change in ambient PM2.5 levels, this 
would suggest that NOX is a significant contributor but that 
ammonia is not. The EPA in this rule is not establishing a quantitative 
test for determining whether PM2.5 levels in a nonattainment 
area change significantly in response to reductions in precursor 
emissions in a state. However, in considering this question, it is 
relevant to consider that relatively small reductions in 
PM2.5 levels are estimated to result in worthwhile public 
health benefits.
    This approach to identifying a precursor for regulation reflects 
atmospheric chemistry conditions in the area and the magnitude of 
emissions of the precursor in the area or State. Assessments of which 
source categories are more cost effective or technically feasible to 
control should be part of the later RACT and RACM assessment, to

[[Page 20591]]

occur after the basic assessment of which precursors are to be 
regulated is completed.
    In the proposed regulatory text, the provisions for reversing 
presumptions for NOX, VOC and ammonia included consideration 
of whether the precursor would significantly contribute to ``other 
downwind air quality concerns.'' In the final rule we have removed that 
language to clarify that identification of attainment plan precursors 
involves evaluation of the impact on PM2.5 levels in a 
nonattainment area of precursor emissions from sources within the 
state(s) where the nonattainment area is located. Other parts of the 
Act, notably section 110(a)(2)(D) and section 126, focus on interstate 
transport of pollutants.
c. Comments and Responses
    Comment: The EPA received several comments supporting EPA's 
interpretation of 302(g) to determine the appropriate regulatory status 
of each precursor pollutant.
    Response: The EPA agrees with the commenters. In establishing 
section 302(g), Congress intended that precursors to NAAQS pollutants 
be subject to the air quality planning and control requirements of the 
CAA. However, the CAA also recognizes that there may be circumstances 
where it is not appropriate to subject precursors to certain 
requirements of the CAA.
    Comment: The EPA received several comments regarding the 
applicability of section 189(e), noting that it requires states to 
presumptively control sources of PM10 precursors except 
where the EPA ``determines that such sources [of precursors] do not 
significantly contribute to PM10 levels which exceed the 
standard in the area.'' Several commenters stated that EPA does not 
have the legal authority to regulate PM2.5 precursors in a 
different manner. Several commenters maintained that all 
PM2.5 precursors presumptively should be subject to 
regulation unless demonstrated by the State as not a significant 
contributor to PM2.5 concentrations in a specific area.
    Response: As stated above, EPA believes that section 302(g) allows 
the Administrator to presumptively not require certain precursors to be 
addressed in PM2.5 implementation plans generally, while 
allowing the State or EPA to make a finding for a specific area to 
override the general presumption. In the following pollutant-specific 
sections of this preamble, EPA finds that at this time there is 
sufficient uncertainty regarding whether certain precursors 
significantly contribute to PM2.5 concentrations in all 
nonattainment areas such that the policy set forth in this rule does 
not presumptively require certain precursors (ammonia, VOC) to be 
controlled in each area. However, the State or EPA may reverse the 
presumption and regulate a precursor if it provides a demonstration 
showing that the precursor is a significant contributor to 
PM2.5 concentrations in the area. In addition, if in the 
State's SIP planning and adoption process a commenter provides 
additional information suggesting an alternative policy for regulating 
a particular precursor, the State will need to respond to this 
information in its rulemaking action.
3. Policy for Ammonia
    [Section II.E.2 of November 1, 2005 proposed rule (70 FR 65999); 
sec. 51.1002 in draft and final regulatory text.]
a. Background
    Ammonia (NH3) is a gaseous pollutant that is emitted by 
natural and anthropogenic sources. Emissions inventories for ammonia 
are considered to be among the most uncertain of any species related to 
PM. Ammonia serves an important role in neutralizing acids in clouds, 
precipitation and particles. In particular, ammonia neutralizes 
sulfuric acid and nitric acid, the two key contributors to acid 
deposition (acid rain). Deposited ammonia also can contribute to 
problems of eutrophication in water bodies, and deposition of ammonium 
particles may effectively result in acidification of soil as ammonia is 
taken up by plants. The NARSTO Fine Particle Assessment \11\ indicates 
that reducing ammonia emissions where sulfate concentrations are high 
may reduce PM2.5 mass concentrations, but may also increase 
the acidity of particles and precipitation. An increase in particle 
acidity is suspected to be linked with human health effects and with an 
increase in the formation of secondary organic compounds. Based on the 
above information and further insights gained from the NARSTO Fine 
Particle Assessment, it is apparent that the formation of particles 
related to ammonia emissions is a complex, nonlinear process.
---------------------------------------------------------------------------

    \11\ NARSTO (2004) (Particulate Matter Assessment for Policy 
Makers: A NARSTO Assessment. P. McMurry, M. Shepherd, and J. 
Vickery, eds. Cambridge University Press, Cambridge, England. ISBN 0 
52 184287 5.
---------------------------------------------------------------------------

    Though recent studies have improved our understanding of the role 
of ammonia in aerosol formation, ongoing research is required to better 
describe the relationships between ammonia emissions, particulate 
matter concentrations, and related impacts. The control techniques for 
ammonia and the analytical tools to quantify the impacts of reducing 
ammonia emissions on atmospheric aerosol formation are both evolving. 
Also, area-specific data are needed to evaluate the effectiveness of 
reducing ammonia emissions on reducing PM2.5 concentrations 
in different areas, and to determine where ammonia decreases may 
increase the acidity of particles and precipitation.
    The proposal showed consideration for the uncertainties about 
ammonia emissions inventories and about the potential efficacy of 
ammonia control measures by providing for a case-by-case approach. It 
was recommended that each State should evaluate whether reducing 
ammonia emissions would lead to PM2.5 reductions in their 
specific PM2.5 nonattainment areas. The proposed policy did 
not require States to address ammonia as a PM2.5 attainment 
plan precursor, unless a technical demonstration by the State or EPA 
showed that ammonia emissions from sources in the State significantly 
contribute to PM2.5 concentrations in a given nonattainment 
area or to other downwind air quality concerns. Where the State or EPA 
has determined that ammonia is a significant contributor to 
PM2.5 formation in a nonattainment area, the State would be 
required to evaluate control measures for ammonia emissions in its 
nonattainment SIP due in 2008, in the implementation of the PM program, 
and in other associated programs in that area.
b. Final Rule
    In the final rule, ammonia is presumed not to be a PM2.5 
attainment plan precursor, meaning that the State is not required to 
address ammonia in its attainment plan or evaluate sources of ammonia 
emissions for reduction measures. This presumption can be reversed 
based on an acceptable technical demonstration for a particular area by 
the State or EPA. If a technical demonstration by the State or EPA 
shows that ammonia emissions from sources in the State significantly 
contribute to PM2.5 concentrations in a given nonattainment 
area, the State must then evaluate and consider control strategies for 
reducing ammonia emissions in its nonattainment SIP due in 2008, in the 
implementation of the PM2.5 program. Technical 
demonstrations on ammonia should also consider the potential for 
atmospheric and particle acidity to increase with ammonia reductions. 
Further discussion about technical demonstrations to

[[Page 20592]]

support reversing a PM2.5 precursor presumption is included 
in section II.A.8 below.
    This approach was retained from the proposal because of continued 
uncertainties regarding ammonia emission inventories and the effects of 
ammonia emission reductions. Ammonia emission inventories are presently 
very uncertain in most areas, complicating the task of assessing 
potential impacts of ammonia emissions reductions. In addition, data 
necessary to understand the atmospheric composition and balance of 
ammonia and nitric acid in an area are not widely available across 
PM2.5 nonattainment areas, making it difficult to predict 
the results of potential ammonia emission reductions. Ammonia 
reductions may be effective and appropriate for reducing 
PM2.5 concentrations in selected locations, but in other 
locations such reductions may lead to minimal reductions in 
PM2.5 concentrations and increased atmospheric acidity. 
Research projects continue to expand our collective understanding of 
these issues, but at this time EPA believes this case-by-case policy 
approach is appropriate. In light of these uncertainties, we encourage 
States to continue efforts to better understand the role of ammonia in 
its fine particle problem areas.
c. Comments and Responses
    Comment: One commenter stated that scientific understanding of the 
complexities of PM formation from ammonia is limited. The commenter 
claimed that the reduction of ammonia will not reduce PM in many areas, 
and speciated PM data to investigate the potential decrease in PM from 
ammonia emissions reductions is not available in all areas.
    Response: The final rule takes these uncertainties into 
consideration by allowing ammonia to be addressed on a case-by-case 
basis. For any area about which enough information is available to 
determine that ammonia emission reductions would lead to a beneficial 
reduction in PM2.5, the State can develop a technical 
demonstration justifying the control of ammonia. If the State chooses 
to develop such a demonstration, preferably it should be completed as 
part of the SIP development process and prior to the adoption of 
control measures, in consultation with the appropriate EPA regional 
office.
    Comment: Some commenters claimed that requiring no action on some 
precursors is counter to the requirement in sections 172(a)(2) and 188 
to attain the NAAQS as expeditiously as practicable. They also asserted 
that presuming that ammonia is not a PM2.5 attainment plan 
precursor violates 302(g) by improperly delegating authority to the 
States.
    Response: In many areas, reducing ammonia emissions could have 
little effect on PM2.5 concentrations and could lead to the 
potentially harmful effect of increased atmospheric acidity. While 
States are not required to take action on ammonia sources under this 
policy, States would be required to address information on ammonia 
brought to their attention during the planning and rule adoption 
process. Under this approach, States should assess whether ammonia 
reductions would lead to reduced PM2.5 concentrations in 
specific nonattainment areas. If the State decides that ammonia 
reductions could yield beneficial reductions in PM2.5, the 
State should complete a technical demonstration supporting a reversal 
of the presumption. The EPA does not believe that this approach 
improperly delegates authority to the States. It establishes a general 
presumption for all areas through this rulemaking process, and allows 
for the presumption to be modified by the State or EPA on a case-by-
case basis. EPA still retains the ability to make a technical 
demonstration for any area if appropriate to reverse the presumption 
and require ammonia to be addressed in its attainment plan.
    Comment: Some commenters stated that the results of a large study 
on air emissions from concentrated animal feeding operations (CAFOs) 
should be evaluated before requiring control of ammonia in areas where 
agriculture is alleged to be a major source.
    Response: The $15 million national CAFO consent agreement study 
coordinated by Purdue University will greatly improve ammonia and VOC 
emissions inventories and our understanding of the impacts of 
agricultural emissions on particle formation. The EPA recognizes that 
the agricultural emissions study is expected to provide data for future 
planning purposes, and we expect that some of the results of the study 
will not be available in time to be considered in the development of 
PM2.5 State Implementation Plans dues in April 2008. 
However, if a State believes it has sufficient technical information to 
warrant regulation of ammonia emissions in their 2008 implementation 
plans, it may include in its plan a demonstration to reverse the 
presumption as well as emission reduction measures. The EPA will review 
each submittal on a case-by-case basis.
    Comment: A presumption to not address ammonia will impede certain 
states (i.e. those that have provisions requiring their regulations to 
be ``no stricter than Federal'' provisions) from regulating ammonia.
    Response: This presumptive approach to ammonia will not restrict 
States from addressing ammonia in their PM2.5 attainment 
plans. If a State has information indicating that reductions in ammonia 
emissions would cause beneficial reductions in PM2.5 
concentrations, the State can make a technical demonstration to reverse 
the presumption. In such cases, inclusion of ammonia as a 
PM2.5 attainment plan precursor would not be considered 
stricter than Federal requirements. Under the policy in the final rule, 
the Federal government or the State may assess the impact of ammonia in 
a particular area and determine whether the presumption of 
insignificance is appropriate or whether ammonia is in fact a 
significant contributor to the PM2.5 problem in the area.
4. Policy for VOC
    [Section II.E.2 of November 1, 2005 proposed rule (70 FR 65999); 
sec. 51.1002 in draft and final regulatory text.]
a. Background
    The VOC policy in this rule addresses volatile and semivolatile 
organic compounds, generally up to 24 carbon atoms. High molecular 
weight organic compounds (typically 25 carbon atoms or more) are 
emitted directly as primary organic particles and exist primarily in 
the condensed phase at ambient temperatures. Accordingly, high 
molecular weight organic compounds are to be regulated as primary 
PM2.5 emissions for the purposes of the PM2.5 
implementation program.
    The organic component of ambient particles is a complex mixture of 
hundreds or even thousands of organic compounds. These organic 
compounds are either emitted directly from sources (i.e. primary 
organic aerosol) or can be formed by reactions in the ambient air (i.e. 
secondary organic aerosol, or SOA). Volatile organic compounds are key 
precursors in the formation processes for both SOA and ozone. The 
relative importance of organic compounds in the formation of secondary 
organic particles varies from area to area, depending upon local 
emissions sources, atmospheric chemistry, and season of the year.
    The lightest organic molecules (i.e., molecules with six or fewer 
carbon atoms) occur in the atmosphere mainly as vapors and typically do 
not directly

[[Page 20593]]

form organic particles at ambient temperatures due to the high vapor 
pressure of their products. However, they participate in atmospheric 
chemistry processes resulting in the formation of ozone and certain 
free radical compounds (such as the hydroxyl radical [OH]) which in 
turn participate in oxidation reactions to form secondary organic 
aerosols, sulfates, and nitrates. These VOCs include all alkanes with 
up to six carbon atoms (from methane to hexane isomers), all alkenes 
with up to six carbon atoms (from ethene to hexene isomers), benzene 
and many low-molecular weight carbonyls, chlorinated compounds, and 
oxygenated solvents.
    Intermediate weight organic molecules (i.e., compounds with 7 to 24 
carbon atoms) often exhibit a range of volatilities and can exist in 
both the gas and aerosol phase at ambient conditions. For this reason 
they are also referred to as semivolatile compounds. Semivolatile 
compounds react in the atmosphere to form secondary organic aerosols. 
These chemical reactions are accelerated in warmer temperatures, and 
studies show that SOA typically comprises a higher percentage of 
carbonaceous PM in the summer as opposed to the winter. The production 
of SOA from the atmospheric oxidation of a specific VOC depends on four 
factors: Its atmospheric abundance, its chemical reactivity, the 
availability of oxidants (O3, OH, HNO3), and the 
volatility of its products. In addition, recent work suggests that the 
presence of acidic aerosols may lead to an increased rate of SOA 
formation. Aromatic compounds such as toluene, xylene, and trimethyl 
benzene are considered to be the most significant anthropogenic SOA 
precursors and have been estimated to be responsible for 50 to 70 
percent of total SOA in some airsheds. Man-made sources of aromatics 
gases include mobile sources, petrochemical manufacturing and solvents. 
Some of the biogenic hydrocarbons emitted by trees are also considered 
to be important precursors of secondary organic particulate matter. 
Terpenes (and b-pinene, limonene, carene, etc.) and the sesquiterpenes 
are expected to be major contributors to SOA in areas with significant 
vegetation cover, but isoprene is not. Terpenes are very prevalent in 
areas with pine forests, especially in the southeastern U.S. The rest 
of the anthropogenic hydrocarbons (higher alkanes, paraffins, etc.) 
have been estimated to contribute 5-20 percent to the SOA concentration 
depending on the area.
    The contribution of the primary and secondary components of organic 
aerosol to the measured organic aerosol concentrations remains a 
complex issue. Most of the research performed to date has been done in 
southern California, and more recently in central California, while 
fewer studies have been completed on other parts of North America. Many 
studies suggest that the primary and secondary contributions to total 
organic aerosol concentrations are highly variable, even on short time 
scales. Studies of pollution episodes indicate that the contribution of 
SOA to the organic particulate matter can vary from 20 percent to 80 
percent during the same day.
    Despite significant advances in understanding the origins and 
properties of SOA, it remains probably the least understood component 
of PM2.5. The reactions forming secondary organics are 
complex, and the number of intermediate and final compounds formed is 
voluminous. Some of the best efforts to unravel the chemical 
composition of ambient organic aerosol matter have been able to 
quantify the concentrations of hundreds of organic compounds 
representing only 10-20 percent of the total organic aerosol mass. For 
this reason, SOA continues to be a significant topic of research and 
investigation.
    Current scientific and technical information clearly shows that 
carbonaceous material is a significant fraction of total 
PM2.5 mass in most areas, that certain VOC emissions are 
precursors to the formation of secondary organic aerosol, and that a 
considerable fraction of the total carbonaceous material is likely from 
local as opposed to regional sources. However, while significant 
progress has been made in understanding the role of gaseous organic 
material in the formation of organic PM, this relationship remains 
complex. We recognize that further research and technical tools are 
needed to better characterize emissions inventories for specific VOC 
compounds, and to determine the extent of the contribution of specific 
VOC compounds to organic PM mass.
    In light of these factors, the proposed rule did not require States 
to address VOCs as PM2.5 attainment plan precursors and 
evaluate them for control measures, unless the State or EPA makes a 
finding that VOCs significantly contribute to a PM2.5 
nonattainment problem in the State or to other downwind air quality 
concerns. Many PM2.5 nonattainment areas are also 
nonattainment areas for the 8-hour ozone standard; control measures for 
VOCs will be implemented in some of these areas, potentially providing 
a co-benefit for PM2.5 concentrations.
b. Final Rule
    The final rule maintains the same policy as proposed.\12\ States 
are not required to address VOC in PM2.5 implementation 
plans and evaluate control measures for such pollutants unless the 
State or EPA makes a technical demonstration that emissions of VOCs 
from sources in the State significantly contribute to PM2.5 
concentrations in a given nonattainment area. Technical demonstrations 
are discussed in section II.A.8 below. If a State chooses to make a 
technical demonstration, it should be developed in advance of the 
attainment demonstration.
---------------------------------------------------------------------------

    \12\ The policy is the same as proposed, with the clarification 
regarding downwind areas discussed above (Section A.2.b).
---------------------------------------------------------------------------

c. Comments and Responses
    Comment: One commenter stated that our understanding of the 
complexities of PM2.5 formation from VOCs is limited, that 
speciated PM data are not available in all areas, and that VOC 
reductions will not reduce PM2.5 in many areas.
    Response: The EPA acknowledges the uncertainties regarding the role 
of VOC in secondary organic aerosol formation. For this reason the 
final rule does not presumptively include VOC as a regulated pollutant 
for PM planning. However, if available data demonstrates that control 
of VOC would reduce PM2.5 concentrations in an area, the 
State or EPA may include VOC as an attainment plan precursor.
    Comment: One commenter stated that the rationale that VOC should 
not be considered a PM2.5 attainment plan precursor because 
most PM areas are also ozone areas is not appropriate because many 
ozone areas will attain soon and VOC reductions will still be needed 
for PM.
    Response: The primary rationale for not including VOC as a 
PM2.5 attainment plan precursor in every nonattainment area 
is the uncertainty regarding the contribution of anthropogenic VOCs to 
the formation of the organic carbon portion of fine particles. In 
certain areas, EPA expects that VOC control measures will have some co-
benefits in the reduction of fine particulates. However, this reason 
should not be considered the principal reason for the policy in the 
final rule that VOCs presumptively should not be considered 
PM2.5 attainment plan precursors. If a State or EPA 
determines that VOCs do contribute significantly to PM2.5 
concentrations in an area, the State will be required to evaluate 
control measures for VOC as a PM2.5 attainment plan

[[Page 20594]]

precursor for that area. This approach will provide for regulation of 
VOCs in locations where it is most appropriate.
    Comment: One commenter suggested that EPA wait for the results of 
the pending agricultural emissions study before requiring control of 
VOCs in agricultural areas.
    Response: The $15 million national CAFO consent agreement study 
coordinated by Purdue University will greatly improve ammonia and VOC 
emissions inventories and our understanding of the impacts of 
agricultural emissions on particle formation. The EPA recognizes that 
the agricultural emissions study is expected to provide data for future 
planning purposes, and we expect that some of the results of the study 
will not be available in time to be considered in the development of 
PM2.5 State Implementation Plans dues in April 2008. 
However, if a State believes it has sufficient technical information to 
warrant regulation of VOC emissions in their 2008 implementation plans, 
it may include in its plan a demonstration to reverse the presumption 
as well as emission reduction measures. The EPA will review each 
submittal on a case-by-case basis.
5. Policy for NOX
    [Section II.E.2 of November 1, 2005 proposed rule (70 FR 65999); 
sec. 51.1002 in draft and final regulatory text.]
a. Background
    The sources of NOX are numerous and widespread. The 
combustion of fossil fuel in boilers for commercial and industrial 
power generation and in mobile source engines each account for 
approximately 30 percent of NOX emissions in 
PM2.5 nonattainment areas (based on 2001 emission inventory 
information). Nitrates are formed from the oxidation of oxides of 
nitrogen into nitric acid either during the daytime (reaction with OH) 
or during the night (reactions with ozone and water). Nitric acid 
continuously transfers between the gas and the condensed phases through 
condensation and evaporation processes in the atmosphere. However, 
unless it reacts with other species (such as ammonia, sea salt, or 
dust) to form a neutralized salt, it will volatilize and not be 
measured using standard PM2.5 measurement techniques. The 
formation of aerosol ammonium nitrate is favored by the availability of 
ammonia, low temperatures, and high relative humidity. Because ammonium 
nitrate is semivolatile and not stable in higher temperatures, nitrate 
levels are typically lower in the summer months and higher in the 
winter months. The resulting ammonium nitrate is usually in the sub-
micrometer particle size range. Reactions with sea salt and dust lead 
to the formation of nitrates in coarse particles. Nitric acid may be 
dissolved in ambient aerosol particles.
    Based on a review of speciated monitoring data analyses, it is 
apparent that nitrate concentrations vary significantly across the 
country. For example, in some southeastern locations, annual average 
nitrate levels are in the range of 6 to 8 percent of total 
PM2.5 mass, whereas nitrate comprises 40 percent or more of 
PM2.5 mass in certain California locations. Nitrate 
formation is favored by the availability of ammonia, low temperatures, 
and high relative humidity. It is also dependent upon the relative 
degree of nearby SO2 emissions because ammonia reacts 
preferentially with SO2 over NOX. NOX 
reductions are expected to reduce PM2.5 concentrations in 
most areas. However, it has been suggested that in a limited number of 
areas, NOX control would result in increased 
PM2.5 mass by disrupting the ozone cycle and leading to 
increased oxidation of SO2 to form sulfate particles, which 
are heavier than nitrate particles. Because of the above factors, the 
proposed rule presumed that States must evaluate and implement 
reasonable controls on sources of NOX in all nonattainment 
areas, but allowed for the State and EPA to develop a technical 
demonstration to reverse this presumption.
b. Final Rule
    The EPA is retaining the proposed approach in the final rule.\13\ 
Under this policy, States are required to address NOX as a 
PM2.5 attainment plan precursor and evaluate reasonable 
controls for NOX in PM2.5 attainment plans, 
unless the State and EPA make a finding that NOX emissions 
from sources in the State do not significantly contribute to 
PM2.5 concentrations in the relevant nonattainment area. 
This presumptive policy is consistent with other recent EPA regulations 
requiring NOX reductions which will reduce fine particle 
pollution, such as the Clean Air Interstate Rule and a number of rules 
targeting onroad and nonroad engine emissions.
---------------------------------------------------------------------------

    \13\ The policy is the same as proposed, with the clarification 
regarding downwind areas discussed above (Section A.2.b).
---------------------------------------------------------------------------

    Technical demonstrations that would reverse the presumption should 
be developed in advance of the attainment demonstration and are 
discussed in section II.A.8 below.
c. Comments and Responses
    Comment: Most commenters generally agreed with the proposed 
inclusion of NOX as a presumptive PM2.5 
attainment plan precursor.
    Response: The EPA agrees with these commenters.
    Comment: Some commenters requested guidance on what would 
constitute an acceptable demonstration to reverse the presumption that 
NOX is a PM2.5 attainment plan precursor.
    Response: Guidance on technical demonstrations to reverse the 
presumptive inclusion of NOX in all state implementation 
plans is discussed in section II.A.8 below.
    Comment: One commenter raised concerns that the proposed policy for 
NOX would allow a State to find NOX to be an 
insignificant contributor to an area's PM2.5 nonattainment 
problem and effectively keep the State from controlling the area's 
NOX emissions for other purposes, such as to address 
interstate transport under section 110 of the CAA. Section 110 requires 
SIPs to prohibit emissions within the State that would contribute 
significantly to another State's nonattainment problem or interfere 
with another State's maintenance plan.
    Response: The identification of precursors for regulation under 
this rule is for purposes of PM2.5 nonattainment and 
maintenance plans under Part D of the CAA. The PM2.5 
implementation rule does not prevent a State from regulating 
NOX sources under any other Federal or State rule, including 
interstate transport rules under Section 110.
6. Policy for SO2
    [Section II.E.2 of November 1, 2005 proposed rule (70 FR 65999); 
sec. 51.1002 in draft and final regulatory text.]
a. Background
    Sulfur dioxide is emitted mostly from the combustion of fossil 
fuels in boilers operated by electric utilities and other industry. 
Less than 20 percent of SO2 emissions nationwide are from 
other sources, mainly other industrial processes such as oil refining 
and pulp and paper production. The formation of sulfuric acid from the 
oxidation of SO2 is an important process affecting most 
areas in North America. There are three different pathways for this 
transformation.
    First, gaseous SO2 can be oxidized by the hydroxyl 
radical (OH) to create sulfuric acid. This gaseous SO2 
oxidation reaction occurs slowly and only in the daytime. Second, 
SO2 can

[[Page 20595]]

dissolve in cloud water (or fog or rain water), and there it can be 
oxidized to sulfuric acid by a variety of oxidants, or through 
catalysis by transition metals such as manganese or iron. If ammonia is 
present and taken up by the water droplet, then ammonium sulfate will 
form as a precipitate in the water droplet. After the cloud changes and 
the droplet evaporates, the sulfuric acid or ammonium sulfate remains 
in the atmosphere as a particle. This aqueous phase production process 
involving oxidants can be very fast; in some cases all the available 
SO2 can be oxidized in less than an hour. Third, 
SO2 can be oxidized in reactions in the particle-bound water 
in the aerosol particles themselves. This process takes place 
continuously, but only produces appreciable sulfate in alkaline (dust, 
sea salt) coarse particles. Oxidation of SO2 has also been 
observed on the surfaces of black carbon and metal oxide particles. 
During the last 20 years, much progress has been made in understanding 
the first two major pathways, but some important questions still remain 
about the smaller third pathway. Models indicate that more than half of 
the sulfuric acid in the eastern United States and in the overall 
atmosphere is produced in clouds.
    The sulfuric acid formed from the above pathways reacts readily 
with ammonia to form ammonium sulfate, 
(NH4)2SO4. If there is not enough 
ammonia present to fully neutralize the produced sulfuric acid (one 
molecule of sulfuric acid requires two molecules of ammonia), part of 
it exists as ammonium bisulfate, NH4HSO4 (one 
molecule of sulfuric acid and one molecule of ammonia) and the 
particles are more acidic than ammonium sulfate. In certain situations 
(in the absence of sufficient ammonia for neutralization), sulfate can 
exist in particles as sulfuric acid, H2SO4. 
Sulfuric acid often exists in the plumes of stacks where 
SO2, SO3, and water vapor are in much higher 
concentrations than in the ambient atmosphere, but these concentrations 
become quite small as the plume is cooled and diluted by mixing.
    Because sulfate is a significant contributor (e.g. ranging from 9 
percent to 40 percent) to PM2.5 concentrations in 
nonattainment areas and to other air quality problems in all regions of 
the country, EPA proposed that States would be required to address 
sulfur dioxide as a PM2.5 attainment plan precursor in all 
areas.
b. Final Rule
    The final rule includes the same policy for sulfur dioxide as in 
the proposal. States are required to address sulfur dioxide as a 
PM2.5 attainment plan precursor and evaluate SO2 
for possible control measures in all areas. Sulfate is an important 
precursor to PM2.5 formation in all areas, and has a strong 
regional impact on PM2.5 concentrations. This policy is 
consistent with past EPA regulations, such as the CAIR, the Clean Air 
Visibility Rule, the Acid Rain rules, and the Regional Haze rule, that 
require SO2 reductions to address fine particle pollution 
and related air quality problems.
    Under the transportation conformity program, sulfur dioxide is not 
required to be addressed in transportation conformity determinations 
before a SIP is submitted unless either the state air agency or EPA 
regional office makes a finding that on-road emissions of sulfur 
dioxide are significant contributors to the area's PM2.5 
problem. Sulfur dioxide would be addressed after a PM2.5 SIP 
is submitted if the area's SIP contains an adequate or approved motor 
vehicle emissions budget for sulfur dioxide. EPA based this decision on 
the de minimis level of sulfur dioxide emissions from on-road vehicles 
currently, and took into consideration the fact that sulfur dioxide 
emissions from on-road sources will decline in the future due to the 
implementation of requirements for low sulfur gasoline (which began in 
2004) and for low sulfur diesel fuel (beginning in 2006). For more 
information, see the May 6, 2005 transportation conformity rule on 
PM2.5 precursors at 70 FR 24283.
c. Comments and Responses
    Comment: Most commenters agreed with the proposed policy for 
SO2. One commenter stated, ``* * * requiring states to 
address sulfur dioxide in attainment planning in all areas is 
consistent with the science of PM2.5 formation and essential 
to effective implementation of the PM2.5 NAAQS.'' Another 
commenter concluded that EPA's proposal ``* * * is justified based on 
the fact that SO2 has been found to be a significant 
contributor to PM2.5 nonattainment in all areas.''
    Response: The EPA agrees with these comments.
    Comment: Some commenters believe States should be able to make a 
demonstration that SO2 not be addressed as an attainment 
plan precursor. The commenters claim that the urban increment of 
sulfate is generally small, and SO2 control will not matter 
in many areas. Commenters also note that a large percentage of the 
SO2 emission inventory is being reduced and will be reduced 
further through existing programs, and that if attainment can be 
demonstrated without additional SO2 controls, a State should 
be allowed to make that demonstration in its SIP. One commenter stated 
that whether SO2 emissions from a given source located in a 
nonattainment area in fact contribute significantly to ambient 
concentrations of sulfate and PM2.5 in that nonattainment 
area likely will depend on a range of factors, including source type, 
stack height, location, and meteorology. The commenter asserted that 
sulfate forms over significant geographic distances from the source of 
the SO2 emissions and may not form significant 
concentrations of PM2.5 in the local nonattainment area.
    Response: As in the proposal, the final rule requires 
SO2 to be considered a PM2.5 attainment plan 
precursor in all cases. Sulfate is a significant fraction of 
PM2.5 mass in all nonattainment areas currently, and 
although large SO2 reductions are projected from electric 
generating units with the implementation of the CAIR program, sulfate 
is still projected to be a key contributor to PM2.5 
concentrations in the future. SO2 emissions also lead to 
sulfate formation on both regional and local scales. The EPA agrees 
that the extent of the contribution from a particular source in a 
nonattainment area to PM2.5 concentrations in the area will 
depend on a number of factors, and that at times the reaction of 
SO2 emissions in the atmosphere to form sulfate particles 
may occur less rapidly and extend over a significant distance. However, 
at other times the conversion of SO2 to sulfate can occur 
rapidly and local impacts from a particular source can be more 
significant. States are required to develop plans to attain as 
expeditiously as practicable through the identification of technically 
and economically feasible control measures from the full range of 
source categories contributing to PM2.5 nonattainment areas. 
In developing these plans, each State will need to consider whether 
controls on local SO2 sources would be cost-effective and 
would be needed to attain expeditiously.
7. Policy for Direct PM
    [Section II.E.2 of November 1, 2005 proposed rule (70 FR 65999); 
sec. 51.1002 in draft and final regulatory text.]
a. Background
    This section addresses inorganic and organic forms of directly 
emitted PM. Although these direct emissions are by definition not 
precursors to PM2.5, this section is included to provide 
information on the full range of

[[Page 20596]]

components that commonly make up fine particulate matter.
    The main anthropogenic sources of inorganic (or crustal) particles 
are: entrainment by vehicular traffic on unpaved or paved roads; 
mechanical disturbance of soil by highway, commercial, and residential 
construction; and agricultural field operations (tilling, planting and 
harvesting). Industrial processes such as quarries, minerals 
processing, and agricultural crop processing can also emit crustal 
materials. While much of these emissions are coarse PM, the size 
distribution can have a tail of particles smaller than 
PM2.5.
    In general, coarse PM is most important close to the source, and 
not generally a significant contributor to regional scale PM problems. 
Even so, during certain high wind events, fine crustal PM has been 
shown to be transported over very long distances.
    Emission estimates of mechanically suspended crustal PM from 
sources within the U.S. are often quite high. However, this PM is often 
released very close to the ground, and with the exception of windblown 
dust events, thermal or turbulent forces sufficient to lift and 
transport these particles very far from their source are not usually 
present. Thus, crustal material is only a minor part of 
PM2.5 annual average concentrations.
    Primary carbonaceous particles are largely the result of incomplete 
combustion of fossil or biomass fuels. This incomplete combustion 
usually results in emissions of both black carbon and organic carbon 
particles. High molecular weight organic molecules (i.e., molecules 
with 25 or more carbon atoms) are either emitted as solid or liquid 
particles, or as gases that rapidly condense into particle form. These 
heavy organic molecules sometimes are referred to as volatile organic 
compounds, but because their characteristics are most like direct PM 
emissions, they will be considered to be primary emissions for the 
purposes of this regulation. Primary organic carbon also can be formed 
by condensation of semi-volatile compounds on the surface of other 
particles.
    The main combustion sources emitting carbonaceous PM2.5 
are certain industrial processes, managed burning, wildland fires, open 
burning of waste, residential wood combustion, coal and oil-burning 
boilers (utility, commercial and industrial), and mobile sources (both 
onroad and nonroad). Certain organic particles also come from natural 
sources such as decomposition or crushing of plant detritus. Most 
combustion processes emit more organic particles than black carbon 
particles. A notable exception to this is diesel engines, which 
typically emit more black carbon particles than organic carbon. Because 
photochemistry is typically reduced in the cooler winter months for 
much of the country, studies indicate that the carbon fraction of PM 
mass in the winter months is likely dominated by direct PM emissions as 
opposed to secondarily formed organic aerosol.
    Particles from the earth's crust may contain a combination of 
metallic oxides and biogenic organic matter. The combustion of surface 
debris will likely entrain some soil. Additionally, emissions from many 
processes and from the combustion of fossil fuels contain elements that 
are chemically similar to soil. Thus, a portion of the emissions from 
combustion activities may be classified as crustal in a compositional 
analysis of ambient PM2.5. The proposed rule required that 
States address the direct emissions of particulate matter in their 
PM2.5 attainment plans. During the comment period, EPA 
received several comments regarding the definition of what should be 
regulated as ``direct PM2.5.''
b. Final Rule
    This rule defines direct PM2.5 emissions as ``air 
pollutant emissions of direct fine particulate matter, including 
organic carbon, elemental carbon, direct sulfate, direct nitrate, and 
miscellaneous inorganic material (i.e. crustal material).'' Development 
of attainment plans will include direct PM2.5 emissions and 
specific PM2.5 attainment plan precursors.
c. Comments and Responses
    Comment: A few commenters noted that 40 CFR 51.1000 of the proposed 
rule includes definitions for both ``direct PM2.5 
emissions'' and for ``PM2.5 direct emissions.'' They 
recommend including just one definition in the final rule.
    Response: The EPA acknowledges this oversight and has included in 
the final rule a single definition for ``direct PM2.5 
emissions.'' It reads: ``Direct PM2.5 emissions means solid 
particles emitted directly from an air emissions source or activity, or 
gaseous emissions or liquid droplets from an air emissions source or 
activity which condense to form particulate matter at ambient 
temperatures. Direct PM2.5 emissions include elemental 
carbon, directly emitted organic carbon, directly emitted sulfate, 
directly emitted nitrate, and other inorganic particles (including but 
not limited to crustal material, metals, and sea salt).''
8. Optional Technical Demonstrations for NOX, VOC, and 
Ammonia
    [Section II.E.2 of November 1, 2005 proposed rule (70 FR 65999); 
sec. 51.1002 in draft and final regulatory text.]
a. Background
    The proposed rule required States to evaluate and consider control 
strategies for sources of SO2 and direct PM2.5 
emissions in all nonattainment areas. For the precursors 
NOX, VOC, and ammonia, the proposed rule included 
presumptive policies that could be reversed with an acceptable 
technical demonstration by the State or EPA. (The policy in the 
proposal presumptively required that NOX emissions must be 
addressed in all areas, and that VOC and ammonia emissions do not need 
to be addressed in all areas.) A number of commenters requested 
additional guidance on the criteria for an acceptable technical 
demonstration.
b. Final Rule
    The final rule retains provisions for the State or EPA to conduct a 
technical demonstration to reverse the presumptive inclusion of 
NOX or to reverse the presumptive exclusions of ammonia and 
VOC as PM2.5 attainment plan precursors. Demonstrations to 
reverse the presumptions for ammonia, VOC, or NOX are to be 
based on the weight of evidence of available information, and any 
demonstration by the State must be approved by EPA. The State must 
demonstrate that based on the sum of available technical and scientific 
information, it would be appropriate for a nonattainment area to 
reverse the presumptive approach for a particular precursor. The 
demonstration should include information from multiple sources, 
including results of speciation data analyses, air quality modeling 
studies, chemical tracer studies, emission inventories, or special 
intensive measurement studies to evaluate specific atmospheric 
chemistry in an area.
    Because of the variation among nonattainment areas in terms of such 
factors as local emissions sources, growth patterns, topography, and 
severity of the nonattainment problem, EPA believes that it would not 
be appropriate to define a prescriptive set of analyses that must be 
included in all PM2.5 precursor technical demonstrations. 
The key criterion is that any technical demonstration must fairly 
represent available information.
    In developing the implementation plan for a nonattainment area, the 
State should use all relevant information

[[Page 20597]]

available (from EPA, the State, or other sources) to determine the 
scientifically most appropriate approach to regulating NOX, 
ammonia, and VOC emissions in the area. As required under any State 
rulemaking process, the State must consider and provide a response in 
the record to any information or evidence brought forward by commenters 
during the SIP planning, development and review process which indicates 
that the presumption for a precursor should be reversed. In its review 
of the forthcoming State implementation plan submittal, EPA will review 
the State's proposed precursor policies in light of all currently 
available information. If information brought forward by commenters or 
the State in the SIP development process shows that the presumption in 
this rule for ammonia, VOC or NOX is not technically 
justified for a particular nonattainment area, the State must conduct a 
technical demonstration to reverse the presumption. In the case of 
ammonia or VOC, the State then would evaluate control measures and 
implement those measures that are technically and economically feasible 
and that will contribute to expeditious attainment of the standards.
    In the section below we suggest examples of the types of analyses 
that would be appropriate to use in developing such a demonstration. 
States are encouraged to consult with EPA in formulating appropriate 
technical demonstrations.
    i. Emission Inventory Information: An analysis might show that a 
precursor composes a significant fraction of the emissions inventory in 
an area and therefore requires greater consideration.

    Example: Several stationary sources emitting particular VOCs 
known to contribute to SOA formation make up a significant portion 
of the area's VOC inventory. This analysis may be useful in 
conjunction with other analyses included in a weight of evidence 
demonstration.

    ii. Speciation Data Information: Analysis of data from speciation 
networks might lead a State to determine the relative importance of a 
precursor to seasonal or yearly average PM concentrations. Individual 
precursors require different approaches. Collection of new data could 
be used to understand the impacts of precursors in an area.

    Example: Nitrate ion is a large portion of winter average 
PM2.5 mass. Nitrate ion is a major portion of 
PM2.5 mass on the 10 highest PM2.5 days in 
winter in the past 3 years. The days with the highest mass 
concentrations might be indicative of inversion conditions and/or 
local impacts, rather than large-scale transport processes. For 
these reasons, nitrate should be addressed in the PM2.5 
attainment plan.
    Example: Ammonium ion data combined with total calculated 
nitrate data indicates that reductions in ammonia would reduce PM 
concentrations without a sharp related increase in particle acidity. 
PM speciation data shows that PM in the area is generally within 10% 
of calculated neutralization. In places for which the needed 
atmospheric data are available to determine whether increased 
acidity is estimated to lead to negative environmental effects, 
analysis showing that increased acidity of particles and 
precipitation would likely result from ammonia reductions would 
support the presumption against ammonia regulation. Analysis showing 
that ammonia reductions would be unlikely to increase the acidity of 
particles and precipitation, and that potential reductions in 
ammonia would significantly reduce PM2.5 levels, would 
support a technical demonstration to reverse the presumption.

    iii. Modeling Information: Results of atmospheric modeling may help 
a State characterize the impacts of potential precursor emission 
reductions on PM2.5 concentrations in an area.

    Example: Modeling of SO2, NOX, and VOC 
emission reductions result in lower sulfate and nitrate levels but 
not lower secondary organic aerosol levels. This likely indicates 
that VOC reductions are not as vital as reductions of the other 
precursors.
    Example: Modeled reductions of NOX show a potential 
increase in sulfate formation through disruption of the ozone cycle. 
SO2 reductions may be a better choice than NOX 
reductions.
    Example: Modeled ammonia reductions show a projected reduction 
in PM2.5 concentrations in selected areas. Although 
dependant on good quality inventory data, this type of an analysis 
would indicate that the area is ammonia-limited and that ammonia 
reductions may be beneficial.
    Example: Modeling shows that reductions in SO2 in the 
absence of NOX reductions in an area will not result in a 
significant PM2.5 reduction because more nitrate 
particles form when less SO2 is available for particle 
formation. However, PM2.5 reductions are significant when 
both SO2 and NOX are reduced concurrently. 
This analysis would indicate that NOX reductions should 
be included in the PM2.5 attainment plan for the area.

    iv. Monitoring, Data Analysis, or Other Special Studies: Could 
include monitoring of gases and compounds not typically monitored under 
the PM2.5 speciation network, receptor modeling analysis, or 
special monitoring studies.

    Example: Data from specialized monitoring studies can provide 
insights about concentrations of ammonia gas and nitric acid in an 
area and whether the area is ammonia-limited or not. Ammonia 
reductions in ammonia-limited areas typically yield reductions in 
PM2.5 concentrations. Specialized monitoring and 
laboratory studies can also assess the relative concentrations of 
organic compounds and provide insights into the contributions of 
different anthropogenic and biogenic VOCs to secondary organic 
aerosol formation.
    Example: Receptor modeling and statistical analysis 
PM2.5 speciation monitoring data can indicate relative 
contributions to PM2.5 mass from sources with different 
chemical ``fingerprints.''
    Example: Additional analysis of organic compounds on filters 
collected through speciation monitoring may reveal insights about 
the relative degree of carbonaceous material considered to be from 
fossil fuel combustion as opposed to combustion of ``modern'' 
material (such as wood or biomass).
c. Comments and Responses
    Comment: A number of commenters requested that the final rule 
include guidance on acceptable technical demonstrations.
    Response: The above section includes examples designed to help 
States formulate appropriate demonstrations. Prescribing specific 
technical indicators to be used in all areas would ignore the 
scientific uncertainty inherent in the relationships between precursor 
emissions and the responses of atmospheric concentrations of 
PM2.5. Therefore, States are encouraged to review available 
information and consult with EPA in formulating technical 
demonstrations appropriate to a particular area.

B. No Classification System

1. No Classification System
a. Background
    Section 172 of subpart 1 contains the general requirements for SIPs 
for all nonattainment areas. Section 172(a)(1) states that on or after 
the date of designation, the Administrator may classify an area for the 
purpose of applying an attainment date or for some other purpose. Thus, 
a classification system is allowed under section 172 of the CAA, but is 
not required for the purposes of implementing a national ambient air 
quality standard. The CAA also states that EPA may consider certain 
factors in making a decision concerning classification for areas, such 
as the severity of nonattainment in such areas, and the availability 
and feasibility of the pollution control measures that may be needed to 
achieve attainment. In the proposed rule, EPA provided two 
implementation approaches for classifying PM2.5 
nonattainment areas. Under the first approach, there would be no 
classification system. Under the second approach, a two-tiered 
classification system would apply, with areas classified as either 
``moderate'' or ``serious'' based on specific criteria.

[[Page 20598]]

    For example, the two classification tiers could be based on the 
severity of nonattainment (e.g., serious areas would be those with a 
design value above a specific threshold), or on the attainment date for 
the area (e.g., serious areas would be those with attainment dates 
after April 2010). However, any moderate area that needs an attainment 
date longer than 5 years would be reclassified as serious. This would 
ensure that areas with a more persistent PM2.5 problem are 
subject to more stringent requirements, even if they are not one of the 
areas with the highest current design values. For such areas, the State 
would be required to request reclassification for an area and ensure 
that the 2008 attainment SIP submission for the area includes all 
measures needed to meet the serious area requirements. Under the two 
tiered classification approach, we proposed that serious 
PM2.5 nonattainment areas would be required to meet the more 
stringent requirements than moderate areas that would be defined in 
this rulemaking action (e.g., lower thresholds for RACT, fixed 
percentage reduction for RFP, etc.). For serious areas, the attainment 
date would be as expeditious as practicable, but no later than 10 years 
after designation, depending on the year in which the area would be 
projected to attain considering existing control requirements and the 
effect of RACM, RACT and RFP.
b. Final Rule
    The EPA believes that in the case of PM2.5, the no-
classification approach is the most appropriate approach. An advantage 
of this approach is that it provides a relatively simple implementation 
structure for State implementation of the PM2.5 standards, 
and avoids the need to define a classification system and determine 
classifications for each area. Without classifications, this rule still 
requires that that SIPs include all reasonable measures that contribute 
to achieving attainment as expeditiously as practicable. (Further 
detail is provided in sections D. and F. below.) Because of differences 
in the nature and sources of the PM2.5 problem in different 
parts of the country, EPA did not find it appropriate to establish a 
tiered classification system with increasing control measure 
requirements. The no-classifications approach provides States with 
greater flexibility to determine the control strategies that will be 
most effective and efficient in bringing specific areas into attainment 
as expeditiously as practicable. In addition, EPA believes that States 
requesting additional time to attain the standard beyond the initial 5 
year attainment date, provided for under Subpart I, will need to adopt 
additional or more stringent measures to meet their obligations for 
RACT, RACM and attainment that is as expeditious as practicable. We 
believe that this addresses the main concerns of those commenters who 
contend that a two tiered classification system should be implemented.
c. Comments and Responses
    Comment: The majority of the commenters who commented on this issue 
stated that they agreed with EPA's preferred no classification 
approach. These commenters generally stated that they believed that EPA 
has the authority not to establish a classification system for 
PM2.5 nonattainment areas. Some commenters stated that it 
would also be unreasonable, at this point in the process, for EPA to 
implement a classification scheme for the PM2.5 standard. 
Many commenters support the no classification approach because it 
provides for a simple implementation structure and/or allows greater 
implementation flexibility to States, including flexibility to address 
specific problems related to individual nonattainment areas in the most 
cost-effective and expeditious manner, rather than through a one size 
fits all approach. Other commenters stated that they believe that a 
classification system is not needed because nonattainment areas in the 
Eastern United States are likely to attain the standard within a 
timeframe that is consistent with the timeframe established under 
Subpart 1.
    Response: The EPA agrees with these commenters.
    Comment: Several commenters disagreed with EPA's preferred approach 
and agreed with the two tiered classification approach featuring a 
``moderate'' and a ``serious'' area classification. These commenters 
also stated that the threat of reclassification or ``bump up'' to a 
higher classification was a powerful incentive for areas to attain as 
expeditiously as practicable. Commenters also indicated that areas 
needing more time to attain the standard should be required to 
implement more stringent measures or mandatory measures.
    Response: The EPA agrees that areas with more severe nonattainment 
problems will need to implement more stringent measures to attain. 
However, EPA does not believe that a classification system is needed to 
ensure that such measures are implemented. The EPA believes that on 
balance the no classification approach is the most appropriate 
classification option for the implementation of the PM2.5 
standard because of the difference in contributing sources from area to 
area.
    Comment: Several commenters stated that under EPA's preferred 
approach, each State would be required to submit an attainment 
demonstration proposing an attainment date that is ``as expeditious as 
practicable'' for each area. They asserted that to allow States to 
propose their own attainment dates would invite delay in the process of 
cleaning up fine particle pollution. These commenters further stated 
that States would have no incentive to set an attainment date earlier 
than the outer limit set by EPA, even if it would be practicable to 
attain the NAAQS sooner.
    Response: Section 172 of the CAA requires SIPs to demonstrate 
attainment as expeditiously as practicable regardless of whether there 
is a classification system, and under this rule states must justify 
that their attainment date is as expeditious as practicable considering 
all reasonable measures. As noted above, EPA believes that States 
requesting additional time to attain the standard beyond the initial 5 
year attainment date will need to adopt additional or more stringent 
measures to meet their obligations for RACT and RACM and to attain as 
expeditiously as practicable. More details on the analytical process 
required for an attainment demonstration is included in section II.F.
    Comment: Several commenters stated that the CAA requires regulation 
of the PM2.5 standard under Subpart 4 of Part D. These 
commenters state that EPA takes the position that it must regulate 
PM2.5 under Subpart 1 of the CAA, which applies to 
nonattainment areas in general. The commenters state that section 7513, 
in Subpart 4 of Part D of the CAA, contains specific provisions for 
classification of particulate matter nonattainment areas, and that EPA 
must therefore regulate PM2.5 under Subpart 4, which 
requires a moderate and serious area classification system. Other 
commenters argued that implementation of the PM2.5 standard 
must proceed under Subpart 1 of Part D of Title I of the CAA and cannot 
be governed by Subpart 4 of Part D, which addresses the implementation 
of the PM10 standard which is a different pollutant than 
PM2.5.
    Response: The EPA finds that the PM2.5 standard should 
be implemented under subpart I of the CAA, which is the general 
provision of the CAA related to NAAQS implementation. Part D of Title I 
of the CAA sets forth the requirements for SIPs needed to attain the 
national ambient air quality standards. Part D also includes a general 
provision under

[[Page 20599]]

Subpart I which applies to all NAAQS for which a specific subpart does 
not exist. Because the PM2.5 standards were not established 
until 1997, the plan provisions found in section 172 of subpart 1 
pertaining to plans for nonattainment areas apply. The EPA further 
agrees with comments stating that subpart 4 on its face applies only to 
the PM10 standard. In general, the emphasis in subpart 4 on 
reducing PM10 concentrations from certain sources of direct 
PM2.5 emissions can be somewhat effective in certain 
PM2.5 nonattainment areas but not in all. Contributions to 
PM2.5 concentrations are typically from a complex mix of 
sources of primary emissions and sources of precursor emissions which 
form particles through reactions in the atmosphere. PM2.5 
also differs from PM10 in terms of atmospheric dispersion 
characteristics, chemical composition, and contribution from regional 
transport.
2. Rural Transport Classification Option
a. Background
    The 8-hour ozone implementation program includes a ``rural 
transport classification'' for subpart 1 nonattainment areas. In the 
proposal for this rule we discussed whether an area classification of 
this type would be appropriate for the PM2.5 implementation 
program in light of the fact that no currently designated 
PM2.5 nonattainment area met the criteria similar to those 
that apply to rural transport areas under the ozone implementation 
program.
    As addressed in the proposal, a PM2.5 nonattainment area 
would qualify for the ``rural transport'' classification if it met 
criteria similar to those specified for rural transport areas for the 
1-hour ozone standard under section 182(h). Section 182(h) defines 
``rural transport'' areas as those areas that do not include, and are 
not adjacent to, any part of a Metropolitan Statistical Area (MSA) or, 
where one exists, a Consolidated Metropolitan Statistical Area (CMSA). 
Section 182(h) further limits the category to those areas whose own 
emissions do not make a significant contribution to pollutant 
concentrations in those areas, or in other areas.
    As discussed in the preamble to the proposed rule, potential 
criteria for a State to identify an area for a rural transport 
classification under the PM2.5 program could be similar to 
the criteria used in the ozone implementation program: A State with a 
PM2.5 ``rural transport'' area would need to (1) demonstrate 
that the area meets the above criteria, (2) demonstrate using EPA 
approved attainment modeling that the nonattainment problem in the area 
is due to the ``overwhelming transport'' of emissions from outside the 
area, and (3) demonstrate that sources of PM2.5 and its 
precursor emissions within the boundaries of the area do not contribute 
significantly to PM2.5 concentrations that are measured in 
the area or in other areas.
    An area which qualifies for the ``rural transport'' classification 
would only be required to adopt local control measures sufficient to 
demonstrate that the area would attain the standard by its attainment 
date ``but for'' the overwhelming transport of emissions emanating from 
upwind States. RFP requirements under subpart 1 would still apply to 
these areas. As with other nonattainment areas, rural transport 
nonattainment areas would be subject to NSR, transportation conformity, 
and general conformity requirements. In the proposal we solicited 
comments on whether it would be appropriate to establish less 
burdensome NSR requirements in the event that a classification for 
rural transport areas is adopted in the final rule. The EPA requested 
comment on whether this type of classification option is needed at all 
under the PM2.5 implementation program.
b. Final Rule
    The final rule does not include a rural transport classification. 
This type of classification was included in the CAA for purposes of 
implementing the ozone standards because of the phenomenon of the 
formation of high ozone levels far downwind in very rural locations, 
including on high elevation mountain peaks. In reviewing the currently 
designated PM2.5 nonattainment areas, it appears that all 
areas but one are within or adjacent to a metropolitan area (i.e. core-
based statistical area or consolidated statistical area), and thus 
would not meet the criteria discussed above. Although PM2.5 
concentrations are greatly affected by long-range transport of air 
pollution, it appears that nonattainment areas typically are located in 
urban areas and include significant local pollutant sources.
c. Comments and Responses
    Comment: Several commenters stated that they do not support the 
adoption of a rural transport classification because it is not needed. 
Commenters stated that given the criteria for the rural transport 
classification, which greatly limits its applicability, few if any 
PM2.5 nonattainment areas can qualify for the option. One 
commenter stated that EPA modeled the rural transport classification 
after the ``rural transport areas'' provision contained in subpart 2 of 
the CAA, which applies only to the ozone standard. The commenter 
further states that neither Subpart 1 nor 4 contain any statutory 
authority for such a classification.
    Response: The EPA believes that it has sufficient statutory 
authority under the CAA to establish a rural transport classification, 
but we do not believe that such a classification is needed.
    Comment: One commenter generally supported the rural transport 
concept and the proposed associated requirements, with the addition 
that data analysis be included as appropriate in the required technical 
demonstrations in addition to modeling. While no PM2.5 area 
currently meets the requirements for the rural transport classification 
option, several commenters recommended that it be maintained for 
potential cases in which the PM2.5 standards are made more 
stringent, or measured air quality in areas change in such a way that 
areas would qualify for the rural transport classification at a later 
date.
    Response: The EPA does not agree that a rural transport 
classification is needed. The EPA will re-evaluate the need for such a 
classification as appropriate.

C. Due Dates and Basic Requirements for Attainment Demonstrations

a. Background
    Part D of Title I of the CAA sets forth the requirements for SIPs 
needed to attain the national ambient air quality standards. Part D 
includes a general subpart 1 which applies to all NAAQS for which a 
specific subpart does not exist. The 1990 CAA Amendments do not include 
any subpart for PM2.5 because the PM2.5 standards 
were not yet established. The EPA has determined that for 
PM2.5, the nonattainment area plan provisions found in 
section 172 of subpart 1 apply.
    Section 172(b) of the CAA requires that at the time the Agency 
promulgates nonattainment area designations, the EPA must also 
establish a schedule for States to submit SIPs meeting the applicable 
requirements of section 172(c) and of section 110(a)(2) of the CAA. 
Nonattainment area designations were finalized in December 2004, and a 
supplemental notice was issued in April 2005. Consistent with section 
172(b) of the CAA, 40 CFR 51.1002 of the proposed rule requires the 
State to submit its attainment demonstration and SIP revision within 3 
years, or by April 2008.
    Section 51.1006 of the proposed rule addresses the situation in 
which an area

[[Page 20600]]

is initially designated as attainment/unclassifiable but is later 
designated as nonattainment based on air quality data after the 2001-
2003 period. Under such circumstances, the SIP submittal date would be 
3 years from the effective date of the redesignation, and the 
attainment date would be as expeditiously as practicable but no later 
than 5 years from the effective date of the redesignation.
    The section 172(c) requirements that States are to address under 
section 172(c) (including RACT, RACM, RFP, contingency measures, 
emission inventory requirements, and NSR) are discussed in later 
sections of this document. Section 110(a)(2) of the CAA requires all 
States to develop and maintain a solid air quality management 
infrastructure, including enforceable emission limitations, an ambient 
monitoring program, an enforcement program, air quality modeling, and 
adequate personnel, resources, and legal authority. Section 
110(a)(2)(D) also requires State plans to prohibit emissions from 
within the State which contribute significantly to nonattainment or 
maintenance areas in any other State, or which interfere with programs 
under part C to prevent significant deterioration of air quality or to 
achieve reasonable progress toward the national visibility goal for 
Federal class I areas (national parks and wilderness areas). In order 
to assist States in addressing their obligations regarding regionally 
transported pollution, EPA has finalized the CAIR to reduce 
SO2 and nitrogen oxide emissions from large electric 
generating units.\14\
---------------------------------------------------------------------------

    \14\ More information on the Clean Air Interstate Rule (CAIR) is 
available at: http://www.epa.gov/cair.
---------------------------------------------------------------------------

    To date, few states have submitted a SIP revision addressing the 
section 110(a)(2) requirements for the purposes of implementing the 
PM2.5 standards. The EPA recognizes that this situation is 
due in part to the fact that there were a series of legal challenges to 
the PM standards which were not resolved until March 2002, at which 
time the standards and EPA's decision process were upheld (see section 
I.B. for further discussion of past legal challenges to the standards). 
To address the States' continuing obligation to address the 
requirements of section 110(a), 40 CFR 51.1002 of the proposed rule 
also required each State to address the required elements of section 
110(a)(2) of the CAA as part of the SIP revision adopting its 
attainment plan, if it has not already done so. On March 10, 2005, EPA 
entered into a consent decree with Environmental Defense and American 
Lung Association concerning EPA's failure to find that States failed to 
submit SIPs to address the section 110(a)(2) requirements. As a part of 
that consent decree, by no later than October 8, 2008, EPA is required 
to publish a notice in the Federal Register related to its 
determinations of whether each State has submitted SIPs for 
PM2.5 that meet the requirements as stated under section 
110(a)(2) of the CAA.
b. Final Rule
    The final rule maintains the regulatory approach described above.
c. Comments and Responses
    There were no comments on this portion of the proposal.

D. Attainment Dates

1. Background on Statutory Requirements
    Establishing attainment dates. Section 172(a)(2) states that an 
area's attainment date ``shall be the date by which attainment can be 
achieved as expeditiously as practicable, but no later than 5 years 
from the date such area was designated nonattainment * * *, except that 
the Administrator may extend the attainment date to the extent the 
Administrator determines appropriate, for a period no greater than 10 
years from the date of designation as nonattainment considering the 
severity of nonattainment and the availability and feasibility of 
pollution control measures.''
    Since PM2.5 designations have an effective date of April 
5, 2005, the initial 5-year attainment date for PM2.5 areas 
would be no later than April 5, 2010. For an area with an attainment 
date of April 5, 2010, EPA would determine whether it had attained the 
standard by evaluating air quality data from the three previous 
calendar years (i.e. 2007, 2008, and 2009).
    For any areas that are granted the full 5 year attainment date 
extension under section 172, the attainment date would be no later than 
April 5, 2015. For such areas, EPA would determine whether they have 
attained the standard by evaluating air quality data from 2012, 2013, 
and 2014. Section 51.1004 of the proposed regulations addressed the 
attainment date requirement. Section 51.1004(b) provided that in their 
attainment demonstrations, States would propose an attainment date 
representing attainment as expeditiously as practicable based upon 
implementation of existing Federal and State measures, and all new 
reasonable local and intrastate measures. The EPA would approve a 
particular attainment date based on its review of the attainment 
demonstration.
    Determining Whether an Area Has Attained. The EPA has the 
responsibility for determining whether a nonattainment area has 
attained the standard by its applicable attainment date. Section 
179(c)(1) of the Act requires EPA to make determinations of attainment 
no later than 6 months following the attainment date for the area. 
Under section 179(c)(2), EPA must publish a notice in the Federal 
Register identifying those areas which failed to attain by the 
applicable attainment date. The statute further provides that EPA may 
revise or supplement its determination of attainment for the affected 
areas based upon more complete information or analysis concerning the 
air quality for the area as of the area's attainment date.
    Section 179(c)(1) of the Act provides that the attainment 
determination for an area is to be based upon an area's ``air quality 
data as of the attainment date.'' The EPA will make the determination 
of whether an area's air quality is meeting the PM2.5 NAAQS 
by the applicable attainment date primarily based upon data gathered 
from the air quality monitoring sites which have been entered into 
EPA's Air Quality System (AQS) database. No special or additional SIP 
submittal will be required from the State for this determination.
    A PM2.5 nonattainment area's air quality status is 
determined in accordance with appendix N of 40 CFR part 50. To show 
attainment of the 24-hour and annual standards for PM2.5, 
the most recent three consecutive years of data prior to the area's 
attainment date must show that PM2.5 concentrations over a 
three-year period are at or below the levels of the standards. A 
complete year of air quality data, as described in part 50, Appendix N, 
comprises of all 4 calendar quarters with each quarter containing data 
from at least 75 percent of the scheduled sampling days. The annual 
standard for PM2.5 is attained when the 3-year average 
annual mean concentration is less than or equal to 15.05 [mu]g/
m3. The 24-hour standard for PM2.5 is met when 
the average of 98th percentile values for three consecutive calendar 
years at each monitoring site is less than or equal to 65.5 [mu]g/
m3.
    The EPA will begin processing and analyzing data related to the 
attainment of PM2.5 areas immediately after the applicable 
attainment date for the affected areas. Current EPA policy, under 40 
CFR part 58, sets the deadline for submittal of air quality data into 
the AQS database for no later than 90 days after the end of the 
calendar year.

[[Page 20601]]

    While EPA may determine that an area's air quality data indicates 
that an area may be meeting the PM2.5 NAAQS for a specified 
period of time, this does not eliminate the State's responsibility 
under the Act to adopt and implement an approvable SIP. If EPA 
determines that an area has attained the standard as of its attainment 
date, the area will remain classified as nonattainment until the State 
has requested, and EPA has approved, redesignation to attainment for 
the area.
    In order for an area to be redesignated as attainment, the State 
must comply with the five requirements listed under section 
107(d)(3)(E) of the Act. This section requires that:

--EPA has determined that the area has met the PM2.5 NAAQS;
--EPA has fully approved the state's implementation plan;
--The improvement in air quality is due to permanent and enforceable 
reductions in emissions;
--EPA has fully approved a maintenance plan for the area;
--The State(s) containing the area have met all applicable requirements 
under section 110 and part D.
2. Establishing Attainment Dates
a. Background
    The EPA proposed rule language on attainment dates that closely 
tracks the statutory language. In the preamble, EPA noted that the 
attainment date that is as expeditious as practicable should reflect 
the projected impact of existing national and State programs (e.g. 
partial implementation of the CAIR rule, final Acid Rain Program, motor 
vehicle tier II standards and heavy-duty diesel engine standards, 
NOX SIP call, State legislation such as Clean Smokestacks 
bill in North Carolina) as well as additional reasonable measures 
required for the PM2.5 nonattainment SIP.
    With respect to its authority to extend an area's date beyond 5 
years, EPA stated in the preamble that the State can submit a SIP 
demonstrating that it is impracticable to attain by the 5-year 
attainment date: ``As stated previously, under section 172(a)(2)(A), 
EPA may grant an area an extension of the initial attainment date for a 
period of one to 5 years. States that request an extension of the 
attainment date under this provision of the CAA must submit a SIP by 
April 5, 2008 that includes, among other things, an attainment 
demonstration showing that attainment within 5 years of the designation 
date is impracticable. It must also show that the area will attain the 
standard by an alternative date that is as expeditious as practicable, 
but in no case later than 10 years after the designation date for the 
area (i.e. by April 5, 2015 for an area with an effective designation 
date of April 5, 2005). An appropriate extension in some cases may be 
only 1 or 2 years--a 5-year extension is not automatic upon request.
    The attainment demonstration must provide sufficient information to 
show that attainment by the initial attainment date is impracticable 
due the severity of the nonattainment problem in the area, the lack of 
available control measures, and any other pertinent information related 
to these statutory criteria. States requesting an extension of the 
attainment date must also demonstrate that all local control measures 
that are reasonably available and technically feasible for the area are 
currently being implemented to bring about expeditious attainment of 
the standard by the alternative attainment date for the area. The 
State's plan will need to project the emissions reductions expected due 
to Federally enforceable national standards, State regulations, and 
local measures such as RACT and RACM, and then conduct modeling to 
project the level of air quality improvement in accordance with EPA's 
modeling guidance. The EPA will not grant an extension of the 
attainment date beyond the initial 5 years required by section 
172(a)(2)(A) for an area if the State has not considered the 
implementation of all RACM and RACT local control measures for the area 
(see section III.I for a more detailed discussion of RACT and RACM). 
The EPA also will examine whether the State has adequately considered 
measures to address intrastate transport of pollution from sources 
within its jurisdiction. In attainment planning, States have the 
obligation and authority to address the transport of pollution from one 
area of the State to another. Any decision made by EPA to extend the 
attainment date for an area beyond its original attainment date will be 
based on facts specific to the nonattainment area at issue and will 
only be made after providing notice in the Federal Register and an 
opportunity for the public to comment.''
b. Final Rule
    We are adopting the approach described above from the proposed 
rule. We also wish to clarify language that was in the preamble to the 
proposed rule regarding the criteria for an extension. The preamble 
stated that attainment date extensions would be based on the two 
statutory extension criteria--``the severity of nonattainment, and the 
availability and feasibility of pollution control measures,''--as well 
as ``other pertinent information which shows that additional time is 
required for the area to attain the standard.'' The CAA does not 
include this third clause and the regulatory text for the final rule 
does not include this third clause. The intent of this language in the 
preamble to the proposal was that States could include ``other 
pertinent information'' related to the two statutory criteria.
c. Comments and Responses
    Comment: Some commenters expressed concern that EPA's preamble 
language appeared to assert a new basis for granting extensions not 
provided by the statute. They said EPA has authority to extend the 
attainment date under Section 7502(a)(2) based solely on consideration 
of two enumerated factors: the severity of nonattainment, and the 
availability and feasibility of control measures.
    Response: The EPA agrees that extensions must be based upon the two 
factors in the statute, which are quite broad. A clarification of the 
preamble phrase cited by the commenter is provided above. The phrase in 
question--``any other pertinent information which shows that additional 
time is required for the area to attain the standard''--refers to 
information that relates to the two statutory factors.
    Comment: One commenter stated that an area should qualify for an 
extension only if the area will implement stringent local controls, yet 
still cannot practicably attain by the five-year deadline. The 
commenter stated that at a minimum, EPA must require states to adopt 
RACM for both mobile and stationary sources before granting an 
extension. Another commenter said that given the difficulty many areas 
will have in meeting the five-year deadline for attainment of the 
PM2.5 NAAQS (and especially in light of the fact that the 
deadline occurs only 2 years after states are to submit attainment 
SIPs), EPA should provide maximum flexibility in allowing extensions to 
the full 10-year period.
    Response: The EPA agrees that extensions should be granted only if 
an area cannot practicably attain within 5 years despite application of 
all reasonable measures, including RACM. Although some measures can be 
implemented within a year or two, many measures require a longer period 
for installation of controls or full program implementation. In light 
of the limited time period between the SIP submittal deadline and the 
5-year date, EPA believes that a significant number of areas may 
warrant extensions ranging from one to 5 years, with the length of

[[Page 20602]]

extension depending on the factors described above.
    Comment: One commenter advocated that EPA include in this final 
rule a determination of those areas for which attainment within 5 years 
is impracticable. Another commenter advocated that EPA establish 
guidance based on EPA national modeling conducted last year to 
establish 2015 as constituting expeditious attainment for certain 
areas.
    Response: The EPA is not determining in this rulemaking the areas 
that should receive extensions or should receive the maximum 10-year 
attainment date, for several reasons. First, EPA did not propose such 
an approach. Therefore, the public has not had the opportunity to 
comment on the approach or on the technical information on which EPA 
would make such judgments.
    Second, EPA believes that modeling being conducted by the states, 
with updated inventories and finer grids, will generally provide a more 
reliable basis for projecting future PM2.5 base case levels 
than national modeling conducted by EPA with older information. State 
modeling of future year PM2.5 levels that has been conducted 
to date indicates that some areas will start closer or farther from the 
standard than EPA had projected.
    Third, the SIP process provides a forum for states to identify 
reasonable controls and conduct analyses to determine the appropriate 
attainment date for an area. This process provides for input from 
expert stakeholders, the general public, other states which may share 
the same multi-State nonattainment area, and EPA on decisions regarding 
controls and attainment dates. At this time, EPA does not have the 
benefit of this process to inform a judgment as to when areas can 
practicably attain. States are responsible for developing RACM 
demonstrations; at this time, EPA lacks the information to conduct a 
credible RACM demonstration for all PM2.5 nonattainment 
areas.
    Fourth, no State commenter advocated that EPA attempt to make these 
judgments on attainment dates in advance of the State SIP process. The 
statute gives the states the lead in developing State implementation 
plans.
    Comment: Another commenter recommends that an area should receive 
an attainment date extension when collectively the following conditions 
have been met:
     It is proven through modeling that the region is adversely 
effected by transport of PM2.5 emissions from up wind 
sources beyond that State's control;
     A State has submitted and committed to implementing all 
Federal PM2.5 emission reduction requirements in a timely 
manner; and,
     The extension concept is approved through the State air 
agency or through the MPO Interagency Consultation Process at the MPO 
level if applicable.
    Response: This commenter advocates for attainment date extensions 
without any consideration of reasonable local measures. As stated 
above, EPA believes that extensions should be granted only if an area 
cannot practicably attain within 5 years despite application of all 
reasonable measures, including RACM. Although some measures can be 
implemented within a year or two, many measures may require a longer 
period for installation of controls or full program implementation. In 
light of the limited time period between the SIP submittal deadline and 
the 5-year date, EPA believes that a significant number of areas may 
warrant extensions ranging from one to 5 years, with the length of 
extension depending on the factors described above.
3. Attainment Dates: 1-Year Extensions
a. Background
    Subpart 1 provides for States to request two 1-year extensions of 
the attainment date for a nonattainment area under limited 
circumstances. Section 172(a)(2)(C) of the CAA provides that EPA 
initially may extend an area's attainment date for 1 year, provided 
that the State has complied with all the requirements and commitments 
pertaining to the area in the applicable implementation plan, and 
provided that the area has had no more than a minimal number of 
``exceedances'' of the relevant standard in the preceding year. Because 
the PM2.5 standards do not have exceedance-based forms but 
are based on 3-year averaging periods, we interpret the air quality 
test in 40 CFR 51.1005 to mean that the area would need to have ``clean 
data'' for the third of the 3 years that are to be evaluated to 
determine attainment.\15\ By this we mean that for the third year, the 
air quality for all monitors in the area as analyzed in accordance with 
Appendix N to 40 CFR part 50 each must have an annual average of 15.0 
[mu]g/m\3\ or less, and a 98th percentile of 24-hour monitoring values 
of 65 [mu]g/m\3\ or less in order to qualify for a 1-year extension. 
(Given the rounding provisions specified in 40 CFR part 50, Appendix N, 
these criteria would be satisfied if the concentrations before final 
rounding are less than an annual average of 15.05 [mu]g/m\3\ and a 24-
hour value of 65.5 [mu]g/m\3\.)
---------------------------------------------------------------------------

    \15\ See section 51.1005 of the proposed regulation.
---------------------------------------------------------------------------

    For example, suppose an area in violation of the annual standard 
has an attainment date of April 2010, and its annual average for 2007 
was 15.8 and for 2008 was 15.6. If the annual average for the area in 
2009 is 14.9, then the 3-year average would be 15.4, and it would not 
have attained the standard. We interpret section 172(a)(2)(C) as 
allowing the area to submit a request to EPA for a 1-year extension of 
its attainment date to 2011 (provided the State has also complied with 
its requirements and commitments) since the 14.9 ambient air quality 
value in the third year (2009) met the test of being at or below 15.0. 
Section 51.1005(a) of the proposed regulation addresses the initial 1-
year attainment date extension.
    The air quality measured in 2010 in conjunction with prior data 
will determine if the area attains the standard, qualifies for a second 
1-year extension, or does not attain the standard. For example, if the 
area's annual average for 2010 is 14.3, then its 3-year average for 
2008-2010 would be 14.9 and it would have met the annual standard.
    If the area's annual average for 2010 is 14.9, however, then its 3-
year average for 2008-2010 would be 15.1. In this situation the area 
would not have attained the standard, but the area would meet the air 
quality test for the second of the 1-year extensions allowed under 
section 172(a)(2)(C), because the 2010 annual average was at or below 
15.0. Section 51.1005(b) of the proposed rule addresses the second 1-
year attainment date extension. After obtaining a second 1-year 
extension, the State would evaluate whether the air quality values in 
2011, in conjunction with 2009 and 2010 data, bring the area into 
attainment.
    Pursuant to section 172(a)(2)(C), States must submit additional 
information to EPA to demonstrate that they have complied with 
applicable requirements, commitments, and milestones in the 
implementation plan. This information is needed in order for EPA to 
make a decision on whether to grant a 1-year attainment date extension. 
The EPA will not be inclined to grant a 1-year attainment date 
extension to an area unless the State can demonstrate that it has met 
important requirements contained in the area's implementation plan. 
States must demonstrate that: (1) Control measures have been submitted 
in the form of a SIP revision and substantially implemented to satisfy 
the requirements of RACT and RACM for the area, (2) the area has made 
emissions reductions progress that

[[Page 20603]]

represents reasonable further progress (RFP) toward attainment of the 
NAAQS, and (3) trends related to recent air quality data for the area 
indicate that the area is in fact making progress toward attainment of 
the standard. Any decision made by EPA to extend the attainment date 
for an area will be based on facts specific to the nonattainment area 
at issue, and will only be made after providing notice in the Federal 
Register and an opportunity for the public to comment.
    If an area fails to attain the standard by the attainment date, EPA 
would publish a finding to this effect in accordance with section 179 
of the CAA. The area then would be required, within 1 year of 
publication of this finding, to develop a revised SIP containing 
additional emission reduction measures needed to attain the standard as 
expeditiously as practicable.
b. Final Rule
    The final rule retains the proposed criteria for states to receive 
a 1-year attainment date extension for a nonattainment area.
c. Comments and Responses
    Comment: A number of commenters supported EPA's ability to grant a 
1-year attainment date extension if monitoring data indicate that the 
PM2.5 levels during the most recent year were below 15.05 
[mu]g/m\3\.
    Response: The EPA agrees with these comments.
    Comment: Some commenters recommended that a 1-year extension be 
provided if the trend line of the area's emissions levels or air 
quality data projects attainment in the extension year.
    Response: The EPA believes that 1-year extensions should be based 
on air quality data, which can be assessed quickly after the end of the 
year. Basing such extensions solely on emissions trends would be 
impractical due to the longer turnaround time needed to evaluate 
emissions changes affecting a monitor.
    Comment: One commenter believes the current requirement is overly 
stringent and inconsistent with the statute. The commenter believes 
that EPA's proposed approach incorrectly defines the statutory language 
referring to a ``minimal number of exceedances'' of the standard in the 
previous year as ``zero'' exceedances. Alternatively, the commenter 
suggests EPA could withdraw this provision and provide more detailed 
guidance giving the Agency and states some flexibility to demonstrate 
that exceedances were minimal in a given case since nothing in the 
statute requires the rigid definition of minimal that EPA proposes.
    Response: The EPA believes the policy in the final rule is a 
reasonable application of the statutory language to a standard not 
based on exceedances. The EPA does not believe it would be appropriate 
to provide a 1-year extension to an area with air quality data showing 
it violating the standard over the 3 years prior to the attainment 
year.
4. Achieving ``Clean Data''
a. Background
    Section III.D of the preamble to the proposed rule describes the 
incentives for attaining the standards prior to April 2008, when SIP 
submittals are due, or prior to an area's approved attainment date. 
Areas with design values just over the level of the standard may be 
able to achieve reductions in the local area or in the State so that, 
when their effect is considered in combination with reductions achieved 
under national programs, they may be sufficient to attain the standards 
before SIPs are due in 2008. For example, if monitoring in a 
nonattainment area shows that the air quality for 2004-2006 meets the 
standards, then the area may be subject to reduced regulatory 
requirements and be redesignated as ``attainment.''
    The EPA issued a ``Clean Data'' policy memorandum in December 2004 
describing possible reduced regulatory requirements for areas that 
attain the standards, but have not yet been redesignated as 
attainment.\16\
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    \16\ Memorandum of December 14, 2004, from Steve Page, Director, 
EPA Office of Air Quality Planning and Standards to EPA Air Division 
Directors, ``Clean Data Policy for the Fine Particle National 
Ambient Air Quality Standards.'' This document is available at: 
http://www.epa.gov/pmdesignations/guidance.htm.
---------------------------------------------------------------------------

b. Final Rule
    In the proposed rule, EPA indicated that it had issued this ``Clean 
Data'' policy to apply for purposes of the PM2.5 standards. 
In this action EPA is finalizing as a rule the statutory interpretation 
that is embodied in the policy. Section 51.1004(c). The text of the 
final rule encapsulates the statutory interpretation set forth in the 
policy. Determinations as to whether individual areas have attained the 
PM2.5 standard and thus qualify for application of the new 
clean data rule will be made in the context of rulemakings for those 
individual areas.
    The preamble to the proposed rule mistakenly stated that if an area 
achieved ``clean data,'' it would be ``relieved of the requirements to 
implement the nonattainment NSR program otherwise required for 
nonattainment areas, and instead would implement the PSD program.'' The 
EPA wishes to clarify that the Clean Data Policy does not provide for 
suspension of the requirements for NSR nor for RACT. The provisions at 
issue in the Clean Data Policy include the requirements for an 
attainment demonstration and other related requirements, reasonable 
further progress, and contingency measures.
c. Comments and Responses
    Comment: One commenter stated that EPA has absolutely no authority 
to waive NSR or any of the CAA's other requirements for nonattainment 
areas merely because a nonattainment area has 3 years of clean data, 
nor does EPA have authority to waive mandatory requirements of the CAA 
such as NSR, RACT, and RFP merely because EPA or the State claims they 
are not needed for attainment. The commenter believes that the only way 
that a nonattainment area can cease implementing controls and 
requirements mandated for such areas is to seek and obtain 
redesignation to attainment, and demonstrate in the process that the 
controls and requirements are not needed for maintenance of standards. 
The CAA has explicit procedures and prerequisites for redesignating 
nonattainment areas to attainment (CAA sections 107(d)(3)(E) and 175A). 
The EPA's ``clean data'' proposal would illegally circumvent those 
requirements.
    Response: The Clean Data policy does not waive requirements for NSR 
nor for RACT. However, EPA believes that ``clean data'' policies for 
the ozone and fine particle programs are based on a reasonable 
interpretation of the CAA. The Clean Data Policy is the subject of two 
EPA memoranda setting forth our interpretation of the provisions of the 
Act as they apply to areas that have attained the relevant NAAQS. The 
EPA also finalized the statutory interpretation set forth in the policy 
in a final rule, 40 CFR 51.918, as part of its Final Rule to Implement 
the 8-Hour Ozone National Ambient Air Quality Standard--Phase 2 (Phase 
2 Final Rule). See discussion in the preamble to the rule at 70 FR 
71645-71646 (November 29, 2005). The legal rationale for the Clean Data 
policy is explained in our Phase 2 Final Rule, in our December 14, 2004 
memorandum from Stephen D. Page entitled ``Clean Data Policy for the 
Fine Particle National Ambient Air Quality Standards'' (Page Memo), and 
in our May 10, 1995 memorandum from John S. Seitz, entitled 
``Reasonable Further Progress, Attainment

[[Page 20604]]

Demonstration, and Related Requirements for Ozone Nonattainment Areas 
Meeting the Ozone National Ambient Air Quality Standard'' (Seitz memo). 
We adopt and reiterate those explications here.
    The EPA has also explained its rationale for applying the Clean 
Data policy in rulemaking actions associated with nonattainment areas 
for the PM10 and 1-hour ozone standards. For rulemaking 
actions applying the Clean Data policy to the PM10 
standards, see 71 FR 27440 (May 11, 2006) (Weirton, WVA), 71 FR 13021 
(March 14, 2006) (Yuma, AZ), 71 FR 6352 (February 8, 2006) (Ajo, AZ). 
For a discussion of the legal rationale supporting rulemaking actions 
applying the Clean Data policy to the 1-hour ozone standards, see, for 
example, 67 FR 49600 (July 31, 2002); 65 FR 37879 (June 19, 2000) 
Cincinnati-Hamilton, Ohio-Kentucky); 61 FR 20458 (May 7, 1996) 
(Cleveland Akron-Lorain, Ohio); 66 FR 53094 (October 19, 2001) 
(Pittsburgh-Beaver Valley, Pennsylvania); 61 FR 31832 (June 21, 1996 
(Grand Rapids, Michigan); 60 FR 36723 (July 18, 1995) (Salt Lake and 
Davis Counties, Utah); 68 FR 25418 (May 12, 2003) (St Louis, Missouri); 
69 FR 21717 (April 22, 2004) (San Francisco Bay Area).
    The EPA has further elaborated on its legal rationale for the Clean 
Data Policy in briefs filed in the 10th, 7th, and 9th Circuits, and 
hereby incorporates those briefs insofar as relevant here. See Sierra 
Club v. EPA, No. 95-9541 (10th Cir.), Sierra Club v. EPA, No. 03-2839, 
03-3329 (7th Cir.), Our Children's Earth Foundation v. EPA, No. 04-
73032 (9th Cir.). As stated in the policy, the attainment 
demonstration, RFP requirements, and contingency measure requirement 
are designed to bring an area into attainment. Once this goal has been 
achieved, it is appropriate to suspend the obligation that States 
submit plans to meet these goals, so long as the area continues to 
attain the relevant standard. The Tenth, Seventh and Ninth Circuits 
have all upheld EPA rulemakings applying the Clean Data Policy. See 
Sierra Club v. EPA, 99 F. 3d 1551 (10th Cir. 1996); Sierra Club v. EPA, 
375 F. 3d 537 (7th Cir. 2004); Our Children's Earth Foundation v. EPA, 
No. 04-73032 (9th Cir. June 28, 2005 (Memorandum Opinion).
    The EPA has explained in its memoranda on the Clean Data Policy for 
PM2.5 and for ozone that it is reasonable to interpret the 
provisions regarding RFP and attainment demonstrations, along with 
certain other related provisions, as not requiring further submissions 
to achieve attainment for so long as the area is in fact attaining the 
standard. Under the policy, EPA is not granting an exemption from any 
applicable requirement under Part D. Rather, EPA has interpreted these 
requirements as not applying for so long as the area remains in 
attainment with the standard. This is not a waiver of requirements that 
by their terms apply; it is a determination that certain requirements 
are written so as to be operative only if the area is not attaining the 
standard.
    CAA section 172(c)(2) provides that SIP provisions in nonattainment 
areas must require ``reasonable further progress.'' The term 
``reasonable further progress'' is defined in section 171(1) as ``such 
annual incremental reductions in emissions of the relevant air 
pollutant as are required by this part or may reasonably be required by 
the Administrator for the purpose of ensuring attainment of the 
applicable NAAQS by the applicable date.'' Thus, by definition, the 
``reasonable further progress'' provision requires only such reductions 
in emissions as are necessary to attain the NAAQS. If an area has 
attained the NAAQS, the purpose of the RFP requirement will have been 
fulfilled, and since the area has already attained, showing that the 
State will make RFP towards attainment will ``have no meaning at that 
point.'' The EPA's General Preamble for the Implementation of Title I 
of the Clean Air Act Amendments of 1990 (General Preamble) 57 FR 13498, 
13564 (April 16, 1992).
    CAA section 172(c)(1), the requirement for an attainment 
demonstration, provides in relevant part that SIPs ``shall provide for 
attainment of the [NAAQS].'' The EPA has interpreted this requirement 
as not applying to areas that have reached attainment. If an area has 
attained the standard, there is no need to submit a plan demonstrating 
how the area will reach attainment. In the General Preamble (57 FR 
13564), EPA stated that no other measures to provide for attainment 
would be needed by areas seeking redesignation to attainment since 
``attainment will have been reached.'' See also Memorandum from John 
Calcagni, ``Procedures for Processing Requests to Redesignate Areas to 
Attainment,'' September 4, 1992, at page 6.
    CAA section 172(c)(9) provides that SIPs in nonattainment areas 
``[S]hall provide for the implementation of specific measures to be 
undertaken if the area fails to make reasonable further progress, or to 
attain the [NAAQS] by the attainment date applicable under this part. 
Such measures shall be included in the plan revision as contingency 
measures to take effect in any such case without further action by the 
State or [EPA].''
    This contingency measure requirement is inextricably tied to the 
reasonable further progress and attainment demonstration requirements. 
Contingency measures are implemented if reasonable further progress 
targets are not achieved, or if attainment is not realized by the 
attainment date. Where an area has already achieved attainment by the 
attainment date, it has no need to rely on contingency measures to come 
into attainment or to make further progress to attainment. As EPA 
stated in the General Preamble:

    ``The section 172(c)(9) requirements for contingency measures 
are directed at ensuring RFP and attainment by the applicable 
date.'' 57 FR 13564. Thus these requirements no longer apply when an 
area has attained the standard.

It is important to note that should an area attain the PM2.5 
standards based on three years of data, its obligation to submit an 
attainment demonstration is not waived but is only suspended. If the 
area then has air quality concentrations in the following year such 
that the area exceeds the standard for years 2 through 4, then the 
area's obligation to submit an attainment demonstration is back in 
effect.
    The determination of attainment contemplated by the Clean Data 
Policy does not purport to be a redesignation, and thus the 
requirements for redesignation under section 107(d) are not applicable. 
Nor does the Clean Data Policy avoid or illegally circumvent the 
redesignation requirements of section 107 of the CAA. All of the 
requirements for redesignation remain in effect and must be satisfied 
for an area to be redesignated. Sierra Club v. EPA, 99 F.3d at 1557-
1558. The Clean Data Policy is simply an interpretation of certain 
provisions of the CAA, whose express purpose is to achieve attainment 
of the standard, as not requiring SIP revisions to be made by the State 
for so long as the area continues to attain the standard. The policy 
does not purport to exempt areas from requirements that are 
inapplicable only if an area is redesignated to attainment. It 
interprets certain provisions which are written in such a way as to 
impose requirements only upon areas that are not attaining the NAAQS, 
regardless of whether they have been redesignated to attainment. The 
EPA has not provided for any waiver from statutory requirements that 
was not provided by Congress. The area at issue remains designated 
nonattainment, and is subject to the risk that if a violation occurs it 
will have to

[[Page 20605]]

adopt and implement reasonable further progress requirements, 
contingency measures, and an attainment demonstration, unless it is 
redesignated to attainment. In order to be redesignated to attainment, 
however, the area will have to satisfy all of the requirements of 
section 107(d)(3)(E), including the requirement for a long-term 
maintenance plan.
    While a determination of attainment is not equivalent to a 
redesignation to attainment, nothing in the Act compels EPA to wait 
until an area meets all the requirements for redesignation before EPA 
makes a determination that the area is in attainment with the standard, 
thereby suspending the requirements for certain provisions related to 
attainment. Indeed, section 179(c) of the Act requires EPA to make an 
attainment determination within six months after an area's applicable 
attainment date whether or not the EPA has made a finding with respect 
to redesignation. The EPA's interpretation of the Act's provisions not 
to require, once attainment has been reached, certain plan submissions 
whose purpose is to assure attainment, is not at odds with the 
requirements for redesignation. Nor does EPA's construction of the 
statute adversely impact planning for maintenance. An area that is 
monitoring attainment, but is still designated as a nonattainment area, 
retains strong incentives to seek redesignation to attainment, and 
remains subject to the requirement to demonstrate maintenance in order 
to be redesignated. For a detailed discussion of the relationship of 
redesignation requirements and attainment determinations, see the 
discussions in the EPA briefs in Our Children's Earth Foundation v. 
EPA, supra at pp. 43-60., Sierra Club v. EPA No. 95-9541 (10th Cir.) at 
29-43, and Sierra Club v. EPA Nos. 03-2839, 03-3329 (7th Cir.) at 33-44 
which are contained in the docket for this rulemaking.
    Comment: A commenter noted that EPA's proposal suggested that areas 
attaining the standard would be subject to reduced regulatory 
requirements. The commenter believed that EPA's interpretation should 
be codified in regulatory form, in order to assure that areas legally 
meeting the current PM2.5 standard and those requesting 
redesignation be enabled to be redesignated and to benefit from the 
interpretation through regulation, rather than by guidance or policy.
    Response: The EPA has adopted the commenter's suggested approach of 
codifying its Clean Data Policy interpretation for PM2.5 in 
regulatory form. Section 51.1004(c). As it did for ozone in its Phase 
II Ozone Implementation Rule, EPA is including in this rulemaking a 
regulation that encapsulates the statutory interpretation that is 
embodied in its Clean Data Policy for PM2.5, set forth 
above. As noted in the response to comment above, determinations as to 
whether individual areas have attained the PM2.5 standard 
and thus qualify for application of the rule will be made in the 
context of rulemakings for those individual areas. The EPA believes, 
however, that encapsulating its interpretation in regulatory form will 
lend clarity and consistency to the process of applying its 
interpretation.

E. Modeling and Attainment Demonstrations

1. Background
    [Section III.F.1 of November 1, 2005 proposed rule (70 FR 66007); 
sec 51.1007 in draft and final regulatory text]
    As noted in the proposal, Section 172(c) requires States with 
nonattainment areas to submit an attainment demonstration. An 
attainment demonstration consists of: (1) Technical analyses that 
locate, identify, and quantify sources of emissions that are 
contributing to violations of the PM2.5 NAAQS; (2) analyses 
of future year emissions reductions and air quality improvement 
resulting from already-adopted national and local programs, and from 
potential new local measures to meet the RACT, RACM, and RFP 
requirements in the area; (3) adopted emission reduction measures with 
schedules for implementation; and (4) contingency measures required 
under section 172(c)(9) of the CAA.
a. Final Rule
    The requirements from the proposal are unchanged. Each State with a 
nonattainment area will be required to submit a SIP with an attainment 
demonstration that includes analyses supporting the State's proposed 
attainment date. States must show that the area will attain the 
standards as expeditiously as practicable and it must include an 
analysis of whether implementation of reasonably available measures 
will advance the attainment date.
2. Areas That Need To Conduct Modeling
    [Section III.F.2 of November 1, 2005 proposed rule (70 FR 66007)]
a. Background
    All nonattainment areas need to submit an attainment demonstration, 
but in some cases, States may not need new, local-scale modeling 
analyses. In the proposed rule, EPA proposed that States may use in a 
PM2.5 attainment demonstration certain local, regional and/
or national modeling analyses that have been developed to support 
Federal or local emission reduction programs, provided the modeling 
meets the attainment modeling criteria set forth in EPA's modeling 
guidance. The proposal also stated that nonattainment areas for which 
local, regional, or national scale modeling demonstrates the area will 
not attain the standard within 5 years of designation would be required 
to submit an attainment demonstration SIP that includes new modeling 
showing attainment of the standards as expeditiously as practicable.
b. Final Rule
    In the final rule, EPA is reaffirming the potential use of national 
and/or regional modeling as part of an attainment demonstration. We are 
also clarifying the types of modeling analyses that may be useful as a 
``primary'' modeling analysis and as a ``supplemental'' analysis. The 
proposal suggested that it may be appropriate, in certain 
circumstances, for a State to submit regional or national modeling as 
the sole (primary) modeling analysis in its attainment demonstration. 
This implies that the State would not need to conduct local modeling 
analyses. We wish to further define the differences between 
``national'', ``regional'', and ``local'' modeling analyses. In this 
context, national analyses are generally those conducted by EPA in 
support of national or regional rules. Regional and local modeling 
analyses are generally those conducted by the RPOs and/or States for 
the purpose of developing State Implementation Plans (SIPs). EPA has 
conducted national scale modeling for a variety of rules and analyses. 
Additionally, the RPOs and many States are conducting regional and/or 
local scale modeling of PM2.5 and regional haze across the 
country. The national scale of the EPA modeling analyses requires basic 
assumptions concerning local model inputs. Compared to regional or 
local modeling done by the States and/or RPOs, EPA modeling may, in 
some cases, use coarser grid resolution, use inventories that are not 
as refined, and model performance may be highly variable from area to 
area. For these reasons, national scale modeling may not always be 
appropriate for local area attainment demonstrations.
    Therefore, we believe that regional or local modeling conducted by 
the States or RPOs is best suited as the primary modeling analysis for 
a modeled

[[Page 20606]]

attainment demonstration. The local modeling is more likely to meet the 
recommendations contained in EPA's modeling guidance. However, some 
areas having design values close to the standard may be projected to 
come into attainment within five years based on modeling analyses of 
national and regional emission control measures (e.g. CAIR) that are 
scheduled to occur through 2009. Regional scale modeling for national 
rules such as the Tier II motor vehicle standards, the Heavy-duty 
Engine standards, the Nonroad Engine standards, and CAIR indicate major 
reductions in PM2.5 by 2010. A portion of these benefits 
will occur in the 2006-2009 PM2.5 attainment timeframe.
    Experience with past ozone attainment demonstrations has shown that 
the process of performing detailed photochemical grid modeling to 
develop an attainment demonstration can be very resource intensive for 
States. The EPA believes that it would be appropriate for States to 
leverage resources by collaborating on modeling analyses to support SIP 
submittals, or by making use of recent modeling analyses that are 
completed prior to the SIP submittal date. For this reason, EPA 
recognizes that States may use in a PM2.5 attainment 
demonstration certain local, regional and/or national modeling analyses 
that have been developed to support Federal or local emission reduction 
programs, provided the modeling meets the attainment modeling criteria 
set forth in EPA's modeling guidance (described below). As with all 
SIPs under subpart 1, the State must demonstrate that the area will 
attain the PM2.5 standards as expeditiously as practicable. 
The judgment of whether the modeling is appropriate for an area should 
be made by the State(s) and their respective EPA regional office on a 
case-by-case basis.
c. Comments and Responses
    Comment: There were many commenters that agreed that States should 
be able to use EPA modeling or other national or regional modeling as a 
modeled attainment demonstration. One commenter recommended that the 
final rule require States to show that the existing modeling 
incorporates realistic assumptions, accurately reflects local emissions 
and trends, and provides adequate model performance for the local 
nonattainment area.
    Response: We agree that national and regional modeling may be used 
as part of an attainment demonstration as long as it is shown to be 
applicable to the local area. This is consistent with the proposal 
where we said that existing modeling should ``meet the attainment 
modeling criteria set forth in EPA's modeling guidance.'' Part of the 
analysis to determine if existing modeling meets the criteria in the 
modeling guidance is to assess whether the modeling incorporates 
realistic assumptions, accurately reflects local emissions and trends, 
and provides adequate model performance for the local nonattainment 
area.
    Comment: Some commenters thought States should be able to use EPA 
modeling in the absence of an analysis of the applicability of the 
modeling for a local nonattainment area. One commenter said that EPA 
should determine that States should not have to do any additional 
modeling analyses if the CAIR modeling showed they were expected to 
attain the NAAQS by 2010.
    Response: While we acknowledge there may be some circumstances in 
which national or regional modeling would be appropriate to use without 
local modeling and allow for such use, we disagree that national 
modeling should be used in support of an attainment demonstration 
without further analysis of the modeling assumptions for a particular 
area. National scale modeling may not always be appropriate for local 
areas. Most often, national scale EPA modeling is best suited for use 
as a supplemental analysis or as part of a ``weight of evidence'' 
demonstration. The modeling guidance recommends supplemental analyses 
for all attainment demonstrations. The guidance specifically recommends 
the examination of other modeling studies as a supplemental analysis. 
The EPA modeling as well as other ``non-local'' modeling can be used 
for this purpose. The ``weight'' of this alternative modeling in an 
attainment demonstration should be guided by how well the modeling 
system is suited for the local nonattainment area. States should 
consult with their EPA regional offices for further guidance and 
recommendations. As such, we do not believe it to be appropriate to 
determine a priori that CAIR or any other modeling analyses are 
appropriate to use in a local attainment demonstration for any or all 
nonattainment areas.
    Comment: Several commenters believe that States should be able to 
use existing EPA modeling (such as CAIR), as the basis for an extension 
of the area's attainment date, if it shows that the nonattainment area 
may not be able to attain the NAAQS by 2010. They believe that the 
State should not have to do additional modeling to show that they need 
an attainment date extension.
    Response: We disagree with this comment. The CAIR modeling included 
national controls that are expected to be in place by 2010 (including 
the CAIR rule itself), as well as existing state and local controls 
reflected in the inventory used in the CAIR analysis. It did not 
include any additional local controls that could be implemented under 
RACT and RACM requirements for the 1997 standards that may bring the 
area into attainment sooner. Nonattainment areas are required to attain 
the NAAQS as expeditiously as practicable. Therefore, updated modeling 
of existing controls as well as additional local controls is needed 
before an attainment date extension can be granted. Additional 
information on attainment dates and extensions is contained in the 
preamble to the final rule, section II.D., and additional information 
on RACT and RACM requirements is contained in section II.F.
    Comment: Several commenters noted an apparent inconsistency in the 
language concerning who would be required to perform ``new'' local-
scale modeling. First, there are potentially conflicting statements in 
the proposal when EPA states that areas with an attainment date of 2010 
will need to conduct local-scale modeling to project the estimated 
level of air quality improvement in accordance with EPA's modeling 
guidance. This conflicts with the proposed ability for States to use 
existing national or regional modeling as their modeled attainment 
demonstration. Second, a portion of a sentence was removed from the 
Federal Register version of the notice which differs from the pre-
Federal Register version. The published version implies that all 
nonattainment areas would be required to submit new modeling.
    Response: We agree that there are inconsistencies in the proposal 
preamble text. To clarify, new local-scale modeling is required for 
areas that are not expected to come into attainment by 2010. For other 
areas, there may be national or regional modeling which may be 
applicable to the area which shows they are likely to come into 
attainment. As noted earlier, national scale modeling is best suited 
for use as a supplemental analysis, but in some cases may be acceptable 
evidence that an area will attain by 2010.
    Additionally, the preamble language in the Federal Register 
contained an error. A portion of a sentence was mistakenly removed, 
which led to some confusion. The language in the FR notice (FR page 
66008) stated ``Nonattainment areas would be required to submit an 
attainment demonstration SIP that includes new modeling showing 
attainment of the

[[Page 20607]]

standards as expeditiously as practicable. The new modeling will need 
to include additional emissions controls or measures in order to 
demonstrate attainment.'' The language should have read, 
``Nonattainment areas for which local, regional, or national scale 
modeling demonstrates the area will not be in attainment of the NAAQS 
within 5 years of designation would be required to submit an attainment 
demonstration SIP that includes new modeling showing attainment of the 
standards as expeditiously as practicable. The new modeling will need 
to include additional emissions controls or measures in order to 
demonstrate attainment.'' This should clarify that States that cannot 
show attainment within 5 years will need to develop new modeling 
analyses which contain additional control strategies which show how and 
when they expect to attain the PM2.5 NAAQS.
    Comment: One commenter maintained that relying on large-scale 
regional modeling alone may allow for PM2.5 hot spots (i.e. 
small unmonitored areas projected to exceed the standard) to exist past 
the attainment date.
    Response: We agree that nonattainment areas with potential hotspot 
issues (relatively high concentrations and/or gradients of primary 
PM2.5) should not rely exclusively on regional modeling. The 
EPA's attainment demonstration modeling guidance attempts to address 
several aspects of hotspot issues in both monitored and unmonitored 
areas \17\. The modeled attainment tests contained in EPA's modeling 
guidance are primarily monitor based tests. Ambient data is combined 
with the model predicted relative change in PM components to determine 
if attainment of the standards is likely in the future. There are 
several aspects of the attainment test. In most cases, States will run 
a photochemical grid model to determine the future year predicted 
PM2.5 concentrations at monitors. The modeling guidance 
generally recommends that for urban scale PM2.5 modeling, 
the State performs modeling analyses at 12 kilometer grid resolution or 
finer. There is an additional component to the attainment test for 
areas that have measured relatively high concentrations and/or 
gradients of primary PM2.5 at monitors. In these cases, we 
recommend running a Gaussian dispersion model for potential primary PM 
sources, to determine the local impact of changes in primary PM 
emissions (from the modeled sources) on predicted concentrations at the 
monitor(s).
---------------------------------------------------------------------------

    \17\ The recommendations contained in the modeled attainment 
demonstration guidance are separate from the Agency's future hot-
spot modeling guidance for transportation conformity purposes.
---------------------------------------------------------------------------

    In addition, we describe an ``unmonitored area analysis'' which 
uses interpolated ambient data combined with gridded model outputs to 
examine whether potential violations of the NAAQS may occur in 
unmonitored areas. If potential violations are indicated, we recommend 
further analysis of the problem through additional local modeling. 
Options for State action to address such a situation could include 
imposition of reasonably available control technology to reduce 
emissions, or the deployment of an air quality monitor to further 
characterize the problem.
    We believe that the combination of these model-based tests will 
adequately determine whether attainment of the standards is likely by 
the attainment date. We also believe that these tests address the issue 
of hotspots by recommending a combination of photochemical modeling, 
dispersion modeling of local sources, and additional monitoring and/or 
emissions controls.
3. Modeling Guidance
    [Section III.F.3 of November 1, 2005 proposed rule (70 FR 66008)]
a. Background
    Section 110(a)(2)(K)(i) states that SIPs must contain air quality 
modeling as prescribed by the Administrator for the purpose of 
predicting the effect of emissions on ambient air quality. The 
procedures for modeling PM2.5 as part of an attainment SIP 
are contained in EPA's ``Guidance for Demonstrating Attainment of Air 
Quality Goals for PM2.5 and Regional Haze.'' The proposal 
summarized several of the chapters in a draft version of the modeling 
guidance.
b. Final Rule
    A draft of the PM2.5 attainment demonstration and 
regional haze modeling guidance has now been revised (September 2006) 
and is available at http://www.epa.gov/ttn/scram/guidance_sip.htm. The 
draft PM2.5 attainment demonstration and regional haze 
guidance has been incorporated into the ozone modeling guidance and is 
now called ``Guidance on the Use of Models and Other Analyses for 
Demonstrating Attainment of Air Quality Goals for the 8-Hour Ozone and 
PM2.5 NAAQS and Regional Haze''. The final version of the 
modeling guidance will be available at the same location in the near 
future.
    The revised draft PM2.5 modeling guidance document is 
very similar to the previous draft version, although there were several 
changes and updates. Among them are new methods in treating 
PM2.5 species components as part of the PM2.5 
attainment test; new methods for determining potential future year 
violations in unmonitored areas; new procedures for handling potential 
PM2.5 ``hotspots''; and an increased reliance on 
supplemental analyses, including ``weight of evidence'' analyses. The 
EPA notes that the PM2.5 attainment demonstration modeling 
guidance that we have released is separate from the Agency's future 
hot-spot modeling guidance for transportation conformity purposes.\18\
---------------------------------------------------------------------------

    \18\ In the March 10, 2006, final transportation conformity rule 
(71 FR 12468), EPA committed to develop PM2.5 and 
PM10 quantitative hot-spot modeling guidance for 
transportation conformity determinations for highway and transit 
projects of local air quality concern.
---------------------------------------------------------------------------

    The modeling guidance describes how to estimate whether a control 
strategy to reduce emissions of particulate matter and its precursors 
will lead to attainment of the annual and 24-hour PM2.5 
NAAQS. Part I of the guidance describes a ``modeled attainment test'' 
for the annual and 24-hour PM2.5 NAAQS. Both tests are 
similar. The output of each is an estimated future design value 
consistent with the respective forms of the NAAQS. If the future design 
value does not exceed the concentration of PM2.5 specified 
in the NAAQS, then the primary modeled test is passed. The modeled 
attainment test applies to locations with monitored data.
    A separate test is recommended to examine projected future year 
PM2.5 concentrations in unmonitored locations.\19\ 
Interpolated PM2.5 ambient data, combined with modeling 
data, is used to predict PM2.5 concentrations in unmonitored 
areas. The goal of this analysis is to identify areas without monitors 
that may be violating the PM2.5 NAAQS, often due to high 
levels of primary PM2.5 (both now and in the future). The 
details of the analysis are contained in the final modeling guidance.
---------------------------------------------------------------------------

    \19\ Application of the unmonitored area analysis is limited to 
locations which are appropriate to allow the comparison of predicted 
PM2.5 concentrations to the NAAQS, based on 
PM2.5 monitor siting requirements and recommendations.
---------------------------------------------------------------------------

    The guidance also discusses modeling PM2.5 at monitors 
where high concentrations of primary PM2.5 are measured. In 
these cases, it may be beneficial to model the primary component of the 
PM2.5 with a Gaussian dispersion model. Dispersion models 
are better able to capture the influence

[[Page 20608]]

of primary PM sources where large concentration gradients may exist. 
Grid models spread out the PM emissions to the size of the grid 
(typically 4 or 12 km). This makes it difficult to judge the benefits 
of control strategies that may affect primary PM sources. The final 
modeling guidance recommends procedures for applying dispersion models 
in these situations.
    The guidance also recommends the submittal of supplemental analyses 
as part of all attainment demonstrations. Supplemental analyses are 
modeling, emissions, and/or ambient data analyses that are submitted as 
part of a SIP, in addition to the primary modeled attainment test. The 
evaluation of supplemental analyses when the predicted concentrations 
in the primary attainment test are close to the NAAQS (slightly above 
or slightly below) is called a weight-of-evidence (WOE) analysis. This 
is simply a collection of evidence that aims to show that attainment of 
the standard is likely. The final version of the modeling guidance puts 
more emphasis on the submittal of supplemental analyses than in 
previous versions.
    Part II of the guidance describes how to apply air quality models 
to generate results needed by the modeled tests for attainment. This 
includes developing a conceptual description of the problem to be 
addressed; developing a modeling/analysis protocol; selecting an 
appropriate model to support the demonstration; selecting appropriate 
meteorological episodes or time periods to model; choosing an 
appropriate area to model with appropriate horizontal/vertical 
resolution; generating meteorological and air quality inputs to the air 
quality model; generating emissions inputs to the air quality model; 
evaluating performance of the air quality model; and performing 
diagnostic tests. After these steps are completed, the model is used to 
simulate the effects of candidate control strategies.
    Comment: Several commenters were supportive of the weight of 
evidence concept. They said that PM2.5 modeling is 
inherently more uncertain than previous ozone modeling and the modeling 
guidance should reflect that. One commenter noted that weight of 
evidence demonstrations should be ``unbiased'', meaning that States 
should use all relevant analyses and not only information that helps 
their case.
    Response: The EPA agrees with these comments. The final modeling 
guidance recommends supplemental analyses (including weight of 
evidence) for all attainment demonstrations. All States should submit 
modeling, ambient data, and emissions analyses in addition to the 
primary modeling demonstration. A weight of evidence analysis is needed 
if the predicted future year PM2.5 concentrations are 
slightly higher or slightly lower than the NAAQS.
    We also agree that a weight of evidence demonstration should 
include all relevant information, including analyses which support 
attainment and those that do not. The idea of the analysis is to 
``weigh'' the evidence, both good and bad. That cannot be fairly done 
if some evidence is not presented.
    Comment: Several commenters suggested that a modeled attainment 
demonstration should not be specifically required. Instead they suggest 
that all demonstrations should be weight of evidence demonstrations. 
This would include different analyses of ambient data, trends, and 
modeling. But due to the uncertainties in the current PM2.5 
models and emissions data, modeling would be but one part of a broader 
weight of evidence approach.
    Response: We disagree with this comment. Model results should be 
the primary analysis of an attainment demonstration. Regardless of 
current uncertainties in the PM2.5 models and emissions, 
models are the only tool that can predict future concentrations of 
PM2.5. The uncertainties in the model inputs and formulation 
should be taken into account when evaluating the results. We agree that 
a broad analysis of modeling, ambient data and emissions trends should 
be part of the attainment demonstration. This is reflected in the final 
modeling guidance.
4. Modeled Attainment Test
    [Section III.F.4 of November 1, 2005 proposed rule (70 FR 66008)]
a. Background
    The proposal described the nature of the attainment tests for the 
annual average and 24-hour average PM2.5 NAAQS contained 
within the modeling guidance. Both tests use monitored data to estimate 
current air quality. The attainment test for a given standard is 
applied at each monitor location within or near a designated 
nonattainment area for that standard. There is also an additional 
attainment test to be performed in unmonitored areas. Models are used 
in a relative sense to estimate the response of measured air quality to 
future changes in emissions. Future air quality is estimated by 
multiplying current monitored values times modeled responses to changes 
in emissions. Because PM2.5 is a mixture of chemical 
components, the guidance recommends using current observations and 
modeled responses of major components of PM2.5 to estimate 
future concentrations of each component. The predicted future 
concentration of PM2.5 is the sum of the predicted component 
concentrations.
b. Final Rule
    The nature of the PM2.5 attainment tests is unchanged. 
The final modeling guidance recommends refinements to the test and 
discusses the treatment of individual PM2.5 species. The 
speciated modeled attainment test (SMAT) that was used to estimate 
future PM2.5 concentrations for CAIR has been (mostly) 
implemented in the final guidance. Among the new recommendations is to 
better account for the known differences between the PM2.5 
Federal Reference Method (FRM) measurements and the PM2.5 
speciation measurements. For example, it is recommended to account for 
the volatilization of nitrate from the FRM filters and to account for 
uncertainties in organic carbon measurements by employing an ``organic 
carbon by mass balance'' technique. This assumes that all remaining 
mass not accounted for by other species is organic carbon mass. 
Additional details are contained in the modeling guidance.
    The guidance also recommends, where necessary, to spatially 
interpolate PM2.5 species data to estimate the species 
concentrations at FRM sites. It is necessary to estimate species 
concentrations when there are no species measurements at FRM sites. 
Several techniques can be used to estimate species concentrations. 
Spatial interpolation techniques may be useful in many areas. In other 
cases, it may be adequate to assume that data from a speciation monitor 
may be representative of multiple FRM monitors. It is particularly 
important to develop credible techniques to estimate species 
concentrations at the locations of the highest FRM monitors.
    The guidance lists several techniques that can be used. The EPA 
will provide software which will apply the modeled attainment test, 
using ambient data and model outputs. Additionally, the software will 
interpolate the PM2.5 species data to allow application of 
SMAT for all FRM monitors. The software will be available at the same 
location as the final modeling guidance (http://www.epa.gov/scram001/guidance_sip.htm).
    Ultimately, it is up to the States to determine the best method to 
represent the PM2.5 species concentrations, subject to EPA's 
review and approval. These estimates are needed to perform the modeled 
attainment test.

[[Page 20609]]

c. Comments and Responses
    Comment: Several commenters were concerned that interpolation of 
PM2.5 species concentrations may not be appropriate in 
certain areas or situations. The concentrations can vary significantly 
between urban and rural areas and even between nearby urban areas. One 
commenter suggested that it might be useful to use older field study 
measurements to derive current species concentrations. Another 
commenter suggested that it might be reasonable to assume that 
speciation measurements were representative of nearby FRM sites.
    Response: We agree that interpolations of species data may not 
always be the best way to estimate species concentrations at FRM sites. 
The modeling guidance lists several different possible techniques. 
States should review their data and situation and choose the most 
reasonable methodology to estimate species concentrations. 
Nonattainment areas that don't have speciation measurements at the 
highest FRM site(s) need to be especially careful. The result of the 
speciated attainment test can be heavily influenced by the assumed 
species concentrations at the highest FRM sites. The attainment test 
will be more straightforward in areas with speciation monitors at the 
highest FRM sites. States are also encouraged to place speciation 
monitors at the highest FRM sites. This will aid in future assessments 
of attainment and ambient trends.
5. Multi-Pollutant Assessments
    [Section III.F.5 of November 1, 2005 proposed rule (70 FR 66009)]
a. Background
    The formation and transport of PM2.5 is in many cases 
closely related to the formation of both regional haze and ozone. There 
is often a positive correlation between measured ozone and secondary 
particulate matter. Many of the same factors affecting concentrations 
of ozone also affect concentrations of secondary particulate matter. 
For example, similarities exist in sources of precursors for ozone and 
secondary particulate matter. Emissions of NOX may lead to 
formation of nitrates as well as ozone. Sources of VOC may be sources 
or precursors for both ozone and organic particles. Presence of ozone 
itself may be an important factor affecting secondary particulate 
formation. The proposal recommended multi-pollutant assessments for 
PM2.5 attainment demonstrations. A multi-pollutant 
assessment, or one-atmosphere modeling, is conducted with a single air 
quality model that is capable of simulating transport and formation of 
multiple pollutants simultaneously. This type of model simulates the 
formation and deposition of PM2.5, ozone, and regional haze 
components, and it includes algorithms simulating gas phase chemistry, 
aqueous phase chemistry, aerosol formation, and acid deposition.
b. Final Rule
    The recommendation to conduct multi-pollutant assessments remains 
unchanged. It is recommended to model the impacts of future year 
control strategies on PM2.5, ozone, and regional haze. It 
may not always be possible or convenient to do so, but it can be 
beneficial to the strategy development process.
    PM2.5 control strategies will have an impact on regional 
haze, and will possibly impact ozone. Even if high ozone and high 
PM2.5 concentrations don't typically occur during the same 
time of the year, controls that affect precursors to PM2.5 
may also affect ozone (e.g. NOX). The SIP submittal dates 
for PM2.5, ozone, and regional haze do not currently line 
up. The PM2.5 SIPs are due almost 1 year later than ozone. 
But States can still do modeling analyses that can provide information 
for multiple pollutants. States can use one-atmosphere models that are 
capable of simulating both ozone and PM2.5. They can also 
try to use consistent meteorological fields and emissions inventories 
so that the same control strategies are relatively easy to evaluate for 
both ozone and PM2.5. Modeling the same future year(s) for 
PM2.5 and ozone can also make it easier to evaluate the 
impacts of controls on both pollutants.
    It should be noted that there are no specific modeling requirements 
other than the recommendation to try to harmonize the ozone, 
PM2.5, and regional haze analyses whenever possible.
c. Comments and Responses
    Comment: One commenter suggests that multi-pollutant assessments 
may not be beneficial because their area experiences winter 
PM2.5 exceedances and summer ozone exceedances.
    Response: We disagree with the comment. Even in situations where 
high PM2.5 and ozone don't occur during the same time of 
year, multi-pollutant assessments may be helpful. NOX 
controls that may be needed to reduce nitrates in the winter are likely 
to have an impact on ozone in the summer. As well, changes in VOCs may 
have an impact on both PM2.5 and ozone. Running potential 
control strategies through the same modeling platform for ozone, 
PM2.5, and regional haze may allow the development of 
optimized strategies.
6. Which Future Year(s) Should Be Modeled?
    [Section III.F.6 of November 1, 2005 proposed rule (70 FR 66009)]
a. Background
    Modeling analyses consist of base year modeling and future year 
modeling. The attainment test examines the change in air quality 
between the base and future years. The proposal recommended, where 
possible, future modeling years should be coordinated so that a single 
year can be used for both PM2.5 and ozone modeling. This 
coordination will help to reduce resources expended for individual 
modeling applications for PM2.5 and ozone and will 
facilitate simultaneous evaluation of ozone and PM impacts.
    Although there is some flexibility in choosing the future year 
modeling time periods, unless the State believes it cannot attain the 
standards within 5 years of the date of designation and must request an 
attainment date extension, the choice of modeling years for 
PM2.5 cannot go beyond the initial 5 attainment period. 
Attainment date extensions will only be granted under certain 
circumstances. Among other things, the State must submit an attainment 
demonstration showing that attainment within 5 years of the designation 
date is impracticable.
b. Final Rule
    Further information is now known concerning the modeling years for 
ozone. Moderate nonattainment areas are presumed to be modeling 2009. 
This is consistent with the last year of the 5 year period allowed 
under Subpart I for PM2.5. Therefore, it is logical to 
presume that areas that are able to attain the PM2.5 NAAQS 
within 5 years will model a future year of 2009. Areas that won't be 
able to attain the standard in 5 years will need to request an 
attainment date extension (of up to 5 additional years).
    The NAAQS must be attained as expeditiously as practicable. 
Therefore, attainment date extensions must contain modeling analyses to 
justify the extension. Details of the required analyses are contained 
in the RACT and RACM sections of the final rule. See section F for more 
details.

F. Reasonably Available Control Technology and Reasonably Available 
Control Measures

    This section of the preamble discusses the final rule requirements 
for RACT and RACM. In order to explain EPA's

[[Page 20610]]

approach in the final rule more clearly, we first discuss the statutory 
and regulatory background for the RACT and RACM requirements, and we 
then explain the key options and interpretations upon which we took 
comment in the proposal. Thereafter, we discuss significant comments we 
received on the proposal and provide brief responses to those comments. 
[Additional comments and responses appear in the RTC for this final 
rule located in the docket.] Most of the comments received on this 
topic addressed the three options EPA proposed for the RACT 
requirement, the relationship between the RACT requirement and EPA's 
Clean Air Interstate Rule (CAIR), and the control measures to be 
required or considered for RACT and RACM.
1. Background on Statutory Requirements for RACT and RACM
    Subpart 1 of Part D of the CAA (sections 171-179B) applies to all 
designated nonattainment areas. Section 172 of this subpart includes 
general requirements for all attainment plans.
    Notably, Congress provided EPA and States a great deal of deference 
for determining what measures to include in an attainment plan. 
Specifically, Section 172(c)(1) requires that each attainment plan 
``provide for the implementation of all reasonably available control 
measures as expeditiously as practicable (including such reductions in 
emissions from existing sources in the area as may be obtained through 
the adoption, at a minimum, of reasonably available control 
technology), and shall provide for attainment of the national primary 
ambient air quality standards.'' By including language in Section 
172(c)(1) that only ``reasonably available'' measures be considered for 
RACT/RACM, and that implementation of these measures need be applied 
only ``as expeditiously as practicable,'' Congress clearly intended 
that the RACT/RACM requirement be driven by an overall requirement that 
the measure be ``reasonable.'' Thus, the rule of ``reason'' drives the 
decisions on what controls to apply, what should be controlled, by when 
emissions must be reduced, and finally, the rigor required in a State's 
RACT/RACM analysis. For example, we previously stated that the Act 
``does not require measures that are absurd, unenforceable, or 
impractical'' or result in ``severely disruptive socioeconomic 
impacts'' 55 FR 38327. Moreover, we interpret the term ``reasonably 
available'' to allow States to consider both the costs and benefits of 
applying the measure, and whether the measure can be readily and 
effectively implemented without undue administrative burden. 66 FR 
26969.
    We also interpret the ``reasonably available control measures'' in 
these provisions as referring to measures of any type that may be 
applicable to a wide range of sources, whereas the parenthetical 
reference to ``reasonably available control technology'' refers to 
measures applicable to stationary sources. RACM can apply to mobile 
sources, areas sources and stationary sources not already subject to 
PM2.5 RACT requirements. Thus, RACT is a type of RACM 
specifically designed for stationary sources. As noted above, States 
are required to implement RACM and RACT ``as expeditiously as 
practicable'' as part of attainment plans designed to attain the 
standards.\20\
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    \20\ Under the Tribal Air Rule (TAR), requirements for RACT and 
RACM may be considered to be severable elements of implementation 
plan requirements for Tribes.
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    Section 172 does not include any specific applicability thresholds 
to identify the size of sources that States and EPA must consider in 
the RACT and RACM analysis. Nor, does Section 172 specifically indicate 
which pollutant(s) or precursor(s) must be subject to RACM or RACT 
measures to attain the NAAQS. Other pollutant-specific provisions of 
the CAA do include applicability thresholds pertaining to attainment 
plan requirements for NAAQS and precursor pollutants. For example, 
subpart 2 of part D, which establishes additional requirements for 
ozone nonattainment areas, establishes thresholds ranging from 100 to 
10 tons per year for requirements applicable to ``major sources'' or 
``major stationary sources,'' depending on the area's classification or 
level of nonattainment. Subpart 4 of part D, which provides additional 
plan requirements for PM10 nonattainment areas, establishes 
thresholds of 100 and 70 tons per year for requirements applicable to a 
``major source'' or ``major stationary source.''
    Moreover, subpart 1, unlike subparts 2 and 4, does not identify 
specific source categories for which EPA must issue control technology 
documents or guidelines, or identify specific source categories for 
State and EPA evaluation during attainment plan development. For ozone, 
subpart 2 contains a list of specific requirements for control 
techniques guidelines (CTGs) and alternative control techniques (ACT) 
documents. For PM10, section 190 of the CAA (in subpart 4) 
places particular emphasis on specific sources of area emissions, but 
does not identify specific stationary source categories for which RACT 
guidance must be issued. Section 190 requires EPA to develop RACM 
guidance documents for residential wood combustion, silvacultural and 
agricultural burning, and for urban fugitive dust control.
2. What Is the Overall Approach To Implementing RACT and RACM in the 
Final Rule?
a. Background for RACT
    Since the 1970s, EPA has interpreted RACT to mean ``the lowest 
emissions limitation that a particular source is capable of meeting by 
the application of control technology that is reasonably available 
considering technological and economic feasibility'' as well as other 
considerations.\21\ Presumptive RACT has been described as the norm 
achievable by the source category.\22\
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    \21\ See, 44 FR 53782, September 17, 1979, and 1976 memorandum 
from Roger Strelow, Assistant Administrator for Air and Waste 
Management to Regional Administrators, ``Guidance for Determining 
Acceptability of SIP Regulations in Non-attainment Areas'' (Dec. 9, 
1976).
    \22\ See e.g. Workshop on Requirements for Non-attainment Area 
Plans--Compilation of Presentations (OAQPS No. 1.2-103, revised 
edition April 1978).
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    Section 110 of the 1970 Clean Air Act required States to develop 
SIPs providing for attainment of the NAAQS by 1975 or 1977. A number of 
areas were having difficulty with developing attainment plans, 
particularly for the ozone standard. In response to the implementation 
needs of this time period, EPA introduced the term ``RACT'' in a 1976 
memorandum from Roger Strelow, Assistant Administrator for Air and 
Waste Management to Regional Administrators, ``Guidance for Determining 
Acceptability of SIP Regulations in Non-attainment Areas'' (Dec. 9, 
1976). In this early guidance relating to the acceptability of SIP 
regulations, we indicated that our overriding concern in approving SIPs 
was attaining the particular NAAQS as expeditiously as practicable 
through reasonably available control technology and other reasonably 
available control measures. ``The basis for fully approving state-
submitted SIP regulations continues to be demonstrated attainment and 
maintenance of all national ambient air quality standards as 
expeditiously as practicable,'' the memo stated.
    The 1977 Clean Air Act amendments added Part D to Title I of the 
Act, and for the first time the Act specifically called for EPA to 
designate nonattainment areas and for SIPs to require RACT and RACM in 
those nonattainment areas. In a 1979 Federal

[[Page 20611]]

Register notice, EPA noted its view that Congress adopted EPA's pre-
existing conception of RACT in the 1977 amendments. (44 FR 53782, 
September 17, 1979). Also during the late 1970s, EPA developed a number 
of new control techniques guideline (CTG) documents as directed in the 
1977 amendments. These CTGs provided States with information on 
controls for a number of categories of sources emitting VOCs, and 
recommended a ``presumptive norm'' for State RACT determinations based 
on the control levels achievable by sources in a given industry. CTGs 
reduced the burden on States by eliminating the need for each State to 
develop its own technical support for implementing the RACT 
requirement. Since the CTG-recommended controls were based on general 
capabilities of an industry, EPA in the 1979 guidance (44 FR 53782) 
urged States in setting RACT to judge the feasibility of the 
recommended controls on particular sources, and to adjust accordingly.
    As noted above, EPA's early guidance related to the RACT 
requirement indicated that our overriding concern in approving State 
RACT requirements was attaining the particular NAAQS. We initially 
required States to apply RACT to qualify for attainment extensions, and 
in some cases, for plans that could not demonstrate attainment.
    During the 1980s, EPA implemented the RACT requirements with a 
number of CTGs and guidance documents. These materials were aimed at 
addressing the attainment deadlines of 1982 and 1987 under the 1977 
Clean Air Act amendments. During this time, EPA, for pollutants other 
than ozone, considered RACT to be dependent upon reductions needed for 
attainment as expeditiously as practicable. For ozone, where the State 
performed photochemical grid modeling, the approach was the same, but 
where the State used less sophisticated tools, we considered RACT to be 
independent of whether the controls were needed to reach attainment as 
expeditiously as practicable. We took this alternate approach because 
of concerns related to the precision of modeling techniques. In other 
words, in those cases, we required that a stationary source of the 
requisite type and size be subject to RACT, whether or not such 
controls were actually demonstrated to be necessary for the area to 
attain by its specified date. (44 FR 20375-20376, April 4, 1979)
    Congress followed a similar approach in the 1990 amendments to the 
CAA for purposes of the ozone NAAQS in the subpart 2 provisions added 
at that time. For example, section 182(b)(2) requires the imposition of 
RACT controls for all VOC source categories covered by a CTG and for 
all other major stationary sources of VOC located within certain 
nonattainment areas. Thus, Congress required these controls without 
allowing for an area-specific demonstration by the State that the area 
needed the controls for attainment as expeditiously as practicable. 
Extensive discussion of this requirement appeared in the 1992 general 
preamble (57 FR 13541), in which EPA provided guidance for 
implementation of the ozone NAAQS.
    Notably, Congress did not significantly amend the generally 
applicable provisions for nonattainment areas that appear in subpart 1 
of Part D in 1990. This indicates that Congress intended that the 
Agency retain the authority to interpret the generally applicable 
nonattainment area plan requirements of section 172(c), including the 
RACT and RACM requirements, in the way that is most appropriate for new 
NAAQS that are subject to subpart 1. As discussed below, EPA has 
determined that an approach to the RACT requirement in which RACT 
varies in different nonattainment areas based on the reductions needed 
for attainment as expeditiously as practicable, is appropriate for 
implementation of the PM2.5 NAAQS. We believe that the 
improved ability to model air quality impacts of emissions controls 
allows for this approach.
b. Proposed Options for RACT
    The EPA proposed and requested comment on three alternative 
approaches for interpretation of the RACT requirement of section 
172(c)(1) for implementation of the PM2.5 NAAQS. The EPA 
proposed these approaches in order to evaluate which method would best 
ensure that States consider and adopt RACT measures for stationary 
sources in a way that is consistent with the overarching requirement to 
attain the standards as expeditiously as practicable, while providing 
flexibility for States to focus regulatory resources on those sources 
of emissions that contribute most to local PM2.5 
nonattainment.
    Under the first proposed alternative, EPA would require States to 
conduct a RACT analysis and to identify and require reasonably 
available controls for all affected stationary sources in the 
nonattainment area, comparable to the implementation of RACT provided 
in subpart 2 governing implementation of the 1-hour ozone NAAQS. Under 
this option, covered sources would be required to apply reasonable 
available controls considering technical and economic feasibility, and 
there would be no opportunity for States to excuse stationary sources 
from control on the basis that the emissions reductions from those 
controls would not be necessary to meet RFP requirements or to reach 
attainment. Under this alternative, EPA proposed to limit the universe 
of sources for which States must conduct a RACT analysis and impose 
RACT controls, by providing an applicability threshold based upon the 
amount of emissions potentially emitted by the sources. Under this 
first option, EPA requested comment on a number of alternative 
emissions applicability thresholds.
    Under the second proposed alternative, EPA would require States to 
conduct a RACT analysis and to identify reasonably available controls 
for all affected stationary sources. Under this option, however, States 
could thereafter determine that RACT does not include controls that 
would not otherwise be necessary to meet RFP requirements or to attain 
the PM2.5 NAAQS as expeditiously as practicable.\23\ Under 
this approach, RACT would be determined as part of the broader RACM 
analysis and identification of all measures--for stationary, mobile, 
and area sources--that are technically and economically feasible, and 
that would collectively contribute to advancing the attainment 
date.\24\ Because RACT and RACM are considered together under this 
alternative, we did not propose emissions threshold options for 
evaluation of stationary source RACT. In addition, consistent with 
existing policies, States would be required to evaluate the combined 
effect of reasonably available measures to determine whether 
application of such measures could advance the attainment date by at 
least one year.\25\
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    \23\ Under the Tribal Air Rule (TAR), requirements for RACT and 
RACM may be considered to be severable elements of implementation 
plan requirements for Tribes.
    \24\ In Sierra Club v. EPA, 294 F.3d 155 (D.C. Cir. 2002), the 
court stated in upholding EPA's statutory interpretation of RACM 
that the Act does not compel a state to consider a measure without 
regard to whether it would expedite attainment.
    \25\ In this notice, where we use the shorthand phrase ``advance 
the attainment date,'' it means ``advance the attainment date by one 
year or more.''
---------------------------------------------------------------------------

    The third proposed alternative, EPA's preferred option in the 
proposal, combined the first two options and is similar to the RACT 
approach adopted in the final implementation rule for the 8-hour ozone 
program. Under the third option, EPA would require States to conduct a 
RACT analysis and to require reasonably available controls for all 
affected stationary sources in

[[Page 20612]]

nonattainment areas with attainment dates more than 5 years from the 
date of designation. For areas with an attainment date within 5 years 
of designation (e.g. by April 5, 2010 for areas with an effective date 
for designation of April 5, 2005), EPA would require RACT as under the 
second proposed alternative, in which RACT would be determined as part 
of the broader RACM analysis. For these areas, States could determine 
that RACT does not include controls that would not otherwise be 
necessary to meet RFP requirements or to attain the PM2.5 
NAAQS as expeditiously as practicable. The same proposed suboptions 
with respect to the size of sources for consideration under the first 
alternative were also included under this alternative.
c. Proposed Approach for RACM
    The EPA proposed and asked for comment on one approach for 
interpreting the RACM requirement for PM2.5. The EPA based 
the proposal on the approach that we adopted for other NAAQS 
implementation programs. Under this approach, a State provides a 
demonstration in its SIP that it adopted all reasonably available 
measures needed to meet RFP requirements and to attain the standard as 
expeditiously as practicable and that no reasonably available 
additional measures would advance the advance the attainment date by at 
least 1 year or would be necessary to meet the RFP requirement for the 
area.\26\
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    \26\ In the context of the PM10 NAAQS, EPA has 
concluded that ``advancement of the attainment date'' should mean an 
advancement of at least one calendar year. See State Implementation 
Plans; General Preamble for the Implementation of Title I of the CAA 
Amendments of 1990, 57 FR 12498 (April 16, 1992). See also Sierra 
Club v. EPA, 294 F.3d 155 (D.C. Cir. 2002).
---------------------------------------------------------------------------

    Under section 172(a)(2), the state implementation plan must provide 
for a nonattainment area to attain as expeditiously as practicable, but 
no later than 5 years after the effective date of designation of the 
area (e.g., no later than April 2010 for the final designations 
effective April 2005). The statute thus creates a presumption for 
attainment within 5 years of designation unless certain statutory 
criteria are met for an extension of the attainment date. Under the 
proposed approach to RACM for PM2.5, each State would 
evaluate available measures for sources of PM2.5 or its 
regulatory precursors in the area to determine if reasonable measures 
were needed to meet the RFP requirement or to achieve attainment as 
expeditiously as practicable. If modeling of all RACM and other state, 
regional and federal measures indicates that the State will not be able 
to demonstrate attainment within 5 years after designation based upon 
the severity of nonattainment in that area or the availability or 
feasibility of implementing controls in that area, then the State may 
request an attainment date extension. We proposed that under these 
circumstances, the EPA could extend the attainment date for a period of 
1 to 5 years, when the State shows that it will implement all RACT and 
RACM as expeditiously as practicable, has met its obligation to address 
intrastate pollution transport from sources within its jurisdiction, 
and still needs additional time to attain.
    In the proposed rule, the EPA also took comment on the following 
overall steps for implementing the statutory requirement for RACM.
    (1) Identification of measures. The State would begin the process 
of determining RACM by identifying all available control measures for 
all sources of PM2.5 and its precursors in the nonattainment 
area. The RACM can apply to mobile sources, area sources, and 
stationary sources.
    (2) Evaluation of measures. After the State identifies the universe 
of available measures for the sources in the area, the State would 
evaluate them to determine whether implementation of such measures is 
technically and economically feasible, and whether the measure will 
contribute to advancing the attainment date.
    (3) Adoption of measures. The State would adopt all reasonably 
available measures for the area consistent with meeting the applicable 
RFP requirements and attaining the NAAQS as expeditiously as 
practicable, in accordance with applicable policy and guidance for 
attainment demonstrations. We would then approve or disapprove the 
State's plan through notice and comment rulemaking. We also noted that 
in reviewing the State's selection of measures for RACM, or determining 
that certain measures are not RACM, EPA may independently supplement 
the rationale of the State or provide an alternative reason for 
reaching the same conclusion as the State.
c. Final Rule
    The EPA carefully considered our interpretation of section 
172(c)(1) for the PM2.5 NAAQS. Because of the variable 
nature of the PM2.5 problem in different nonattainment 
areas, which may require States to develop attainment plans that 
address widely disparate circumstances (e.g., different source types 
and mixes, different precursors and mixes of precursors, and different 
meteorological conditions), we determined that the regulations 
implementing the PM2.5 NAAQS should provide for a great 
degree of flexibility with respect to the RACT and RACM controls.
    Selected approach to RACT and RACM. The final rule reflects EPA's 
decision to select option 2 for RACT and to require a combined approach 
to RACT and RACM. Under this approach, RACT and RACM are those measures 
that a State finds are both reasonably available and contribute to 
attainment as expeditiously as practical in the specific nonattainment 
area.
    By definition, measures that are not necessary either to meet the 
RFP requirement, or to help the area attain the NAAQS as expeditiously 
as practicable, are not required RACT or RACM for such area. The EPA 
believes that this approach provides the greatest flexibility to a 
State to tailor its SIP control strategy to the needs of a particular 
PM2.5 nonattainment area, but it may require the State to 
conduct a more detailed analysis to identify the most effective RACT/
RACM strategy to attain the NAAQS.
    During the comment period, commenters raised concerns that this 
approach may be overly burdensome on States because of the number of 
potential control measures a State would need to consider. Today, we 
clarify that although the State must conduct a thorough analysis of 
reasonably available measures, States need not analyze every 
conceivable measure, as explained in the guidance below. Instead, 
``reason'' should drive States identification of potential measures, 
but States should remain mindful of the public health risks of 
PM2.5. As long as a State's analysis is sufficiently robust 
in considering potential measures to ensure selection of all 
appropriate RACT and RACM, and the State provides a reasoned 
justification for its analytical approach, we will consider approving 
that State's RACT/RACM strategy.
    Guidance on State analysis to identify RACT, RACM and appropriate 
attainment date. A State must consider RACT and RACM for all of its 
nonattainment areas. However, EPA believes that if the State projects 
that an area will attain the standard within 5 years of designation as 
a result of existing national measures (i.e. projected to have a design 
value of 14.5 or lower), then the State may conduct a limited RACT and 
RACM analysis that does not involve additional air quality modeling. A 
limited analysis of this type would involve the review of reasonably 
available measures, the estimation of potential emissions

[[Page 20613]]

reductions, and the evaluation of the time needed to implement these 
measures. If the State could not achieve significant emissions 
reductions during 2008 due to time needed to implement the potential 
measures or other relevant factors, then the State and EPA could 
conclude that there are no further reasonably available control 
measures for that area that would advance the attainment date by one 
year or more relative to the presumptive outer limit for attainment 
dates, i.e., 5 years from designation. In lieu of conducting air 
quality modeling to assess the impact of potential RACT and RACM 
measures, States may consider existing modeling information to 
determine the magnitude of emissions reductions that could 
significantly affect air quality and potentially result in attaining 
prior to 2010 (e.g. in 2009 based on 2006-8 air quality data). If the 
State, in consultation with EPA, determines from this initial, limited 
RACT and RACM analysis that the area may be able to advance its 
attainment date through implementation of reasonable measures, then the 
State would conduct a more detailed RACT and RACM analysis, including 
appropriate air quality modeling analyses, to assess whether it can 
advance the attainment date.
    In general, the combined approach to RACT and RACM in the final 
rule includes the following steps: (1) Identification of potential 
measures that are reasonable; (2) modeling to identify the attainment 
date that is as expeditious as practicable; and (3) selection of RACT 
and RACM.
    Identification of potential measures. The State's review of 
potential measures must be sufficient to identify all appropriate RACT 
and RACM. As stated previously, inherent to RACT/RACM is the basic 
requirement that the measure be ``reasonable.'' A State need not 
evaluate measures in its RACM/RACT analysis that it determines are 
unreasonable such as measures that are ``absurd, unenforceable, or 
impractical'' or that would cause ``severely disruptive socioeconomic 
impacts, (e.g. gas rationing and mandatory source shutdowns); such 
measures are not required by the Act. 55 FR 38327.
    As we also stated earlier, a State's RACT/RACM analysis not only 
involves an assessment about what emissions sources to control and to 
what level, but also a judgment as to when it is reasonable to require 
a sector to comply with a given measure. Accordingly, if the State or 
Federal rules already heavily regulate a given sector, it is reasonable 
for the State to first look to unregulated parts of the sector for 
RACT/RACM measures, especially, in light of costs already realized by 
the regulated sector. A State may conclude that it is unreasonable to 
further regulate the industry, or that it is only reasonable to impose 
measures in the latter years of the attainment plan.
    Finally, the State should use reason in the extent of its efforts 
to identify potential control measures. For example, if a review of 
monitoring data and modeling studies indicates that reductions in 
SO2 are much more effective in reducing ambient 
PM2.5 than reductions in other pollutants, we expect that 
the State will more vigorously identify RACT/RACM measures for 
SO2 than for other pollutants. Conversely, if reductions in 
a given pollutant, even in large quantities, would have trivial impacts 
on PM2.5, less rigor is needed in the State's assessment of 
controls for that pollutant, because such controls could not contribute 
to advancing the attainment date. Likewise, where reducing emissions of 
a pollutant is effective in reducing ambient PM2.5, if the 
emissions inventory for that pollutant is dominated by a given type of 
emissions source, then it would be appropriate to focus the analysis on 
measures for that segment of the inventory. No RACT/RACM analysis is 
needed for pollutants that are not attainment plan precursors for a 
particular PM2.5 nonattainment area.
    As supporting information for identification of RACT and RACM, the 
State ordinarily provides data on technologically feasible control 
measures:

--A list of all emissions source categories, sources and activities in 
the nonattainment area (for multi-State nonattainment areas, this would 
include source categories, sources and activities from all states which 
make up the area)
--For each source category, source, or activity, an inventory of direct 
PM2.5 and precursor emissions;
--For each source category, source, or activity, a list of 
technologically feasible emission control technologies and/or measures 
\27\
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    \27\ The EPA believes that it is not necessary to identify every 
possible variation of every type of control measure, or all possible 
combinations of technologies and measures that would apply to a 
given source or activity if the State has properly characterized the 
potentially available emissions reductions and their costs. For 
example, EPA believes that the State can conduct a thorough analysis 
of VMT reduction measures without including every possible level or 
stringency of implementation of certain possible measures or 
combinations of measures for reducing VMT, so long as those measures 
would not affect the overall assessment of VMT reduction 
capabilities and the associated costs.
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--For each technologically feasible emission control technology or 
measure, the State should provide the following information: (1) The 
control efficiency by pollutant; (2) the possible emission reductions 
by pollutant; (3) the estimated cost per ton of pollutant reduced; and 
(4) the date by which the technology or measure could be reasonably 
implemented.

    Based on this and other relevant information, the State will 
identify the reasonable measures (potential RACT and RACM) to be 
included in air quality modeling. (At its option, the State may prefer 
not to make a judgment on whether certain measures are technically and 
economically feasible, if it believes they will not contribute to 
earlier attainment. In that case, the State could include those 
measures in the modeling, and later exclude them from RACT and RACM by 
showing that all the excluded measures together would not advance the 
attainment date by at least 1 year.) As previously mentioned, in 
determining the attainment date that is as expeditious as practicable, 
the State should consider impacts on the nonattainment area of 
intrastate transport of pollution from sources within its jurisdiction, 
and potential reasonable measures to reduce emissions from those 
sources.
    Modeling to determine the attainment date that is as expeditious as 
practicable. Second, for purposes of determining the attainment date 
that is as expeditious as practicable, the State will need to conduct 
modeling to show the combined air quality impact of all of the 
potential measures identified in the first step with a modeling 
analysis for the year 2009. A base case scenario for the year 2009 
would project future air quality given implementation of existing 
measures (Federal, State and local). If this base case scenario 
demonstrates attainment by 2010, then the State must demonstrate why 
attainment could not be achieved in an earlier year. (As noted above, 
given the April 2008 due date for SIP submissions, it may be difficult 
to achieve earlier attainment in many cases).
    If the base case scenario does not demonstrate attainment, then a 
control case scenario (described below) is needed to examine whether 
the reasonable, technically and economically feasible measures 
identified by the State would result in attainment in 2009. The control 
case scenario would add potential SIP measures--e.g. potential RACT/
RACM, plus any candidate intrastate transport measures that the State 
has identified

[[Page 20614]]

and would be feasible to implement by that year. States in multi-State 
nonattainment areas are strongly encouraged to collaborate on their 
modeling analyses. This modeling, along with other information known as 
weight of evidence considerations, would inform a judgment as to 
whether reasonable measures could lead to attainment of the standards 
within 5 years after designation. If the analysis does not demonstrate 
attainment by April 2010 (2009 analysis year), then the analysis would 
serve as the technical basis for the State to seek an extension of the 
attainment date for that area. Further analysis would then be necessary 
and is required to identify the specific attainment date.
    The choice of future years to model beyond 2010 may vary from area 
to area. Often, modeling potential controls in two different future 
years may be necessary to support a judgment that a projected 
attainment year is as expeditious as practicable. If the area is 
projected to remain over the standard in the early projection year 
(e.g., 2009) despite the emission reductions from the modeled control 
measures, but is projected to be well below the standard in the later 
projection year (e.g., 2012), interpolation and emission inventory 
analysis could identify an intermediate year as the appropriate 
attainment date. There may be cases in which modeling a single year is 
sufficient because modeling of all technically and economically 
feasible controls results in attainment by a narrow margin in that 
year.
    For many areas, EPA modeling analysis for CAIR and other modeling 
analyses that have been performed suggest a number of nonattainment 
areas will have a modest amount (in some cases only a few tenths of a 
microgram) of needed reductions in ambient levels after 2010 to reach 
attainment. For any such area, and for areas otherwise expected to 
attain relatively soon after 2010 (for example, due to substantial 
reductions in a dominant local source), EPA believes that this analysis 
should be for a year no later than 2012. A later date (e.g., 2014) may 
be appropriate for areas with very high PM2.5 levels that 
face difficulty attaining within 10 years.
    The EPA believes that it is not reasonable to require States to 
model each and every year between 2009 and 2014 to determine the 
appropriate attainment date. Modeling future year inventories is a time 
consuming and resource intensive process. Multiple models and pre-
processors are needed in order to generate year specific emissions for 
the various emissions sectors (e.g. mobile, non-road, non-EGU point, 
EGU point, etc.). Because it is not reasonable to model every year, a 
logical choice often may be to model a year in the middle of the 
period. As such, we recommend modeling an emissions year no later than 
2012 as the initial extension date (which translates to a 2013 
attainment date). If this modeling indicates that the area can reach 
attainment by 2012, then the State can further analyze emissions and 
strategies to determine if the attainment date can be advanced to an 
earlier year. If the modeling indicates that the area cannot reach 
attainment by 2012, then the modeling will serve as further 
justification for granting a longer attainment date extension (e.g., 
attainment date of 2015 with modeling for 2014). In that case, 
additional modeling of 2014 with further emissions controls would be 
required in order to show attainment. Again, the State should then 
further analyze emissions and strategies to determine if the attainment 
date can be advanced to an earlier year between 2012 and 2015.
    Additionally, in the discussion of air quality modeling issues in 
section II.E above, we discuss the benefits of addressing control 
strategies for multiple pollutants. Part of the challenge of multi-
pollutant modeling is coordinating the future modeling years for 
different pollutants in order to minimize the number of required future 
year model runs. As part of the requirements of the 8-hour ozone 
implementation rule, States are currently working on modeling analyses 
for 2009 and in some cases for 2012 (serious nonattainment areas). For 
an area that cannot attain the PM2.5 NAAQS by 2010, this may 
be reason to select 2012 as the year to model, so that the State could 
conduct the modeling for both ozone and PM2.5 in tandem. 
This would, in some cases, allow the pooling of resources (e.g., 
inventories, model runs, etc.) and provide for faster development of a 
PM2.5 attainment demonstration.
    It may also be possible for the State to look at 2009 and 2014 
only. In this instance, the State may find sufficient data to 
interpolate results for the years in between based on estimated changes 
in emissions.
    We emphasize that when a State models later years, that this 
analysis must take into account potential controls that the State may 
have determined would not be RACT or RACM for an earlier year. For 
example, some measures that are impractical to implement by 2009 could 
be reasonable if implemented by 2010, 2011 or 2012. Thus, when the 
State models later years, the list of potential controls should be 
expanded to include technically and economically feasible measures that 
can be implemented by the analysis year.
    Selection of RACT & RACM. Based on this analysis, the State should 
make decisions on RACT, RACM, intrastate measures, and the attainment 
date that is as expeditious as practicable. Because EPA is defining 
RACT and RACM as only those reasonable, technically and economically 
feasible measures that are necessary for attainment as expeditiously as 
practicable, the State need not adopt all feasible, reasonable 
measures. The State may exclude those reasonable measures that, 
considered collectively, would not advance the attainment date.

Comments and Responses

    Comment: A number of commenters generally supported EPA's second 
proposed alternative to RACT (option 2). Most of these commenters 
expressed concern that the other options would require the imposition 
of controls whether or not they were needed to attain the 
PM2.5 standards as expeditiously as practicable. Some State 
and local commenters also urged EPA to select option 2 as the best 
interpretation of the RACT requirement for PM2.5 because 
they believe that it will be the most appropriate approach for 
designing attainment strategies for their particular nonattainment area 
or areas.
    Response: The EPA agrees that these two points are important 
considerations. After carefully considering the options, we concluded 
that Option 2 was the most suitable approach for the PM2.5 
NAAQS. Options 1 and 3 do not reduce the States' burden to analyze 
potential control measures as the States would still be required to 
look beyond the mandated RACT for reasonably available control measures 
(RACM). Moreover, Options 1 and 3 could require imposition of controls 
on some sources that would not strictly be necessary to attain the 
NAAQS as expeditiously as practicable. Given the nature of the 
PM2.5 nonattainment problem, EPA concluded that an 
interpretation that provides the maximum flexibility is a better 
approach.
    Comment: Some commenters recommended that EPA modify proposed 
option 2 to include a tons-per-year threshold. Under such an approach, 
the States and EPA would only require RACT for sources whose emissions 
were above the threshold. Most of these comments recommended a RACT 
threshold of 100 tons per year. These commenters expressed concern that 
if option 2 were implemented

[[Page 20615]]

without such a threshold, States would be burdened with conducting RACT 
analyses for very small sources or source categories with low 
emissions.
    Response: The EPA believes that under the approach chosen for the 
final rule in which RACT is considered to be a part of the overall RACM 
process, it would be difficult to define a threshold that would apply 
for all types of sources and for all types of control measures in all 
nonattainment areas. It has not been common practice under past EPA 
policy to establish or use an emissions threshold when considering 
sources for possible emission reductions as part of a RACM analysis to 
show attainment as expeditiously as practicable. Indeed, many of the 
control technique guidelines for VOC RACT do not recommend an emissions 
threshold. A state needing significant emission reductions to attain 
the standards in a given area even by 2015 would likely conclude that 
controls should be considered on smaller sources. In contrast, a State 
with an area that exceeds the standard by only a few tenths of a 
microgram per cubic meter may not need to consider controls on smaller 
source to reach attainment as expeditiously as practicable. The EPA has 
selected option 2 for interpretation of the RACT requirement for 
PM2.5, in part, specifically because that approach 
contemplates that States will conduct an appropriate analysis of the 
spectrum of source categories and potential controls available. To cut 
off such analysis at a set emissions-based cut point for all sources 
and all areas would undermine one of the key benefits of the approach. 
Accordingly, EPA disagrees with comments that option 2 should include a 
nationally-defined threshold for the size of sources or source 
categories that require RACT analyses.
    Comment: A number of commenters supported EPA's first and third 
proposed alternative approaches to RACT (option 1 and option 3). 
Commenters supporting these two options used similar reasoning. 
Commenters cited the statutory language in section 172(c)(1) requiring 
that the attainment plan provide for ``at a minimum'' the adoption of 
RACT. Accordingly, these commenters argued that RACT is an independent, 
minimum requirement of attainment plans irrespective of the attainment 
demonstration and that option 2, which would not require the adoption 
of RACT for all sources, has no policy or legal justification. Other 
commenters noted that option 1 would be much easier to implement, 
because RACT would be defined according to technical reasonableness and 
would not hinge on complicated determinations involving attainment 
demonstrations. Some commenters argued that option 1 provides for 
greater equity, because similar measures would be required for similar 
sources for all nonattainment areas. Finally, some commenters believed 
that it is inherently inconsistent to assert that plans have met the 
requirement for attainment ``as expeditiously as practicable'' without 
applying RACT to all major sources.
    Response: The EPA disagrees with these comments. The EPA believes 
that option 2 is fully consistent with section 172(c)(1). Section 
172(c)(1) requires that attainment plans must provide for the 
implementation of RACM as expeditiously as practicable (including such 
reductions in emissions from existing sources in the area as may be 
obtained through the adoption, at a minimum, of RACT). Contrary to the 
commenters' assertions, this language does not demonstrate that RACT is 
required for all sources, independent of RACM and attainment 
demonstrations. Moreover, this provision does not require RACT whether 
or not imposition of technology would advance the attainment date. 
Instead, section 172(c)(1) explicitly provides that RACT is included 
within the definition of RACM, and EPA has previously determined that 
the CAA only requires such RACM as will provide for attainment as 
expeditiously as practicable. (See 57 FR 13498, 13560). The courts have 
deferred to this interpretation and concluded that EPA interprets RACM 
as a collection of reasonable measures that would advance the 
attainment date. See Sierra Club v. EPA, 294 F.3d 155, 162 (D.C. Cir. 
2002); see also Sierra Club v. EPA, 314 F.3d 735, 744 (5th Cir. 2002). 
The CAA does not ``compel [ ] a State to consider whether any measure 
is `reasonably available' without regard to whether it would expedite 
attainment in the relevant area.'' Sierra Club v. EPA, 294 F.3d at 162. 
The EPA concludes that because section 172(c)(1) establishes that RACT 
is a part of RACM, EPA is reasonably applying the same interpretation 
to the RACT requirement for PM2.5. The RACT is a part of the 
collection of measures that are necessary to reach attainment as 
expeditiously as practicable. It is thus directly related to what a 
specific area needs to attain the NAAQS, and States need not implement 
reasonably available measures that would not advance the attainment 
date as part of the PM2.5 RACT requirement.
    The EPA also finds that option 2 is consistent with the statutory 
language providing that a State must apply RACT to existing sources, 
``at a minimum,'' to meet its requirement to apply RACM. We interpret 
the ``at a minimum'' clause to mean that when a State determines that 
control of a specified existing stationary source(s) is necessary to 
attain, the State must apply RACT to that source. Further, EPA believes 
this requirement for RACT applies to stationary sources as a group, and 
not to each stationary source.
    The EPA finds sound policy reasons for choosing option 2. While an 
approach that provided for application of the same controls in all 
areas would provide for more equity across areas, EPA emphasizes that 
equity is only one of many factors considered by EPA when deciding 
between options 1, 2 and 3. The EPA believes that it is also important 
to ensure that control strategies focus on the most effective measures 
with the greatest possibility for significant air quality improvements. 
In addition, while EPA agrees that options 1 and 3 could provide for 
greater ease of implementation, this is also only one of the factors 
EPA considered when deciding between the proposed options. Under option 
2, States have a greater burden and responsibility to identify the 
local strategy that is tailored to their particular air quality 
problem. At the same time, the States have the ability to identify the 
sources with the greatest impact on nonattainment and to identify a 
sound strategy that achieves attainment in the most sensible manner. 
The EPA believes that approaching RACT and RACM in this manner is 
consistent with the overall philosophy imbedded in the SIP program 
since its inception in the late 1960s and early 1970s.
    Comment: Some commenters believed that the proposed RACM 
requirement was too broad. These commenters believed that the 
requirement to analyze the entire ``universe'' of possible measures was 
too burdensome for States. Commenters felt this was especially true in 
light of the lack of federally issued CTG and ACT documents for 
PM2.5 and its precursors for all potential source 
categories.
    Response: As explained earlier, States should apply ``reason'' in 
identifying measures to evaluate as potential RACM/RACT. We recognize 
that States are implementing the PM2.5 standard for the 
first time, and do not have the long history and experience in 
implementing PM2.5 as they have in implementing the 
PM10 and ozone standards. Accordingly, we expect that both 
the States and EPA will expend extra effort in developing and 
evaluating attainment plans that contain appropriate controls. A number

[[Page 20616]]

of resources exist to provide States with information on potential 
control measure costs and emissions reductions. We intend to facilitate 
the sharing of information through a control measure website and other 
efforts, and expect that States will develop screening methods to 
reduce the burden of analysis.
    Comment: One commenter asserted that EPA should not require the 
analysis for, or implementation of, RACT and RACM for sources 
throughout the entire nonattainment area, and should permit States to 
focus only on sources located in smaller specific ``problem areas'' 
within the nonattainment area.
    Response: The EPA designated areas nonattainment based upon 
analysis of the geographic area with sources that ``contribute'' to the 
violation of the NAAQS in the area, in accordance with section 107(d). 
These designations are based upon, among other things, a network of 
monitors that the State and EPA previously agreed represented the 
ambient air concentrations throughout the area. Additional analysis of 
information during the designation process indicated those areas that 
contributed to the violations at the violating monitor because of, 
among other things, the amount of emissions in such adjoining areas. 
Accordingly, the State in which a nonattainment area is located must 
evaluate the full range of sources of PM2.5 and its 
precursors throughout the designated nonattainment area during the 
development of the SIP. The EPA agrees that there are some 
nonattainment areas where one or a few large emissions sources may be 
causing localized concentrations at a monitor that are much higher than 
those within the remainder of the nonattainment area. For such areas, 
the nonattainment strategy will likely not succeed without addressing 
those sources. The EPA does not, however, believe it is acceptable that 
the nonattainment strategy focus only on those sources, because 
additional reductions within the nonattainment area would still have 
the potential to advance the attainment date. Exempting portions of the 
nonattainment area could expose a portion of the public residing 
downwind in the area to exposure to levels of PM2.5 that 
exceed the NAAQS for longer than necessary, and the health detriments 
from such exposure, merely to minimize the impact of having to impose 
control strategies on sources upwind. Moreover, to the extent that 
monitoring in one portion of a nonattainment area indicates violations 
in multiple portions of the area, a strategy that solely focused upon 
the sources in the immediate vicinity of the monitor might fail to 
assure that the NAAQS is achieved throughout the area. Because NAAQS 
violations generally reflect a combination of regional scale, 
metropolitan scale, and local scale impacts, and all three scales must 
be addressed, EPA requires RACT/RACM submittals to address sources 
throughout the nonattainment area.
    Comment: Some commenters agreed with EPA's view that State's RACM 
analysis must address those measures that a State declines to adopt and 
must show whether the combined measures would cumulatively advance the 
attainment date by at least 1 year. One commenter questioned the legal 
basis for EPA's determination that the only controls necessary to 
attain the PM2.5 NAAQS as expeditiously as practicable are 
those that would cumulatively advance an area's projected attainment 
date by at least one calendar year. The commenter suggested that 
control measures that would advance attainment by a smaller increment 
``would meet the criteria endorsed in Sierra Club [Sierra Club v. EPA, 
294 F.3d 155 (D.C. Cir 2002)] by `expedit[ing] attainment in the 
relevant area.' ''
    Response: The EPA has consistently interpreted RACM as a collection 
of measures that would advance the attainment date by at least 1 year, 
and the courts have determined that the statutory RACM requirement is 
ambiguous and deferred to EPA's interpretation of the requirement. See 
Sierra Club v. EPA, 314 F.3d 735, 744 (5th Cir. 2002); see also Sierra 
Club v. EPA, 294 F.3d, 155 162 (D.C. Cir. 2002). Contrary to the 
commenter's suggestion, the court in Sierra Club v. EPA, did not 
endorse specific criteria for identifying control measures that 
expedite attainment, but instead deferred to EPA's interpretation of an 
ambiguous statutory term. The courts deferred to EPA's interpretation 
after reviewing EPA's approval of State SIP submissions. The EPA 
conducts such reviews consistent with its determination that the CAA 
only requires such RACM as will provide for attainment as expeditiously 
as practicable, and its belief that it would be unreasonable to require 
implementation of measures that would not in fact advance attainment. 
See 57 FR 13498, 13560 (April 15, 1992); see also 44 FR 20372, 20374 
(April 4, 1979). In considering whether a collection of measures would 
advance the attainment date of an area, EPA has previously interpreted 
the phrase ``advance the attainment date'' as meaning that the 
attainment date would be advanced by at least 1 year. See e.g., 66 FR 
57160, 57182 (Nov. 14, 2001) (approval of Houston SIP); 66 FR 586 (Jan 
3. 2001) (approval of DC area SIP). Further, EPA's use of a one-year 
increment in determining whether a collection of measures would advance 
the attainment date is reasonable and consistent with the fact that all 
areas will be designing attainment demonstrations for the annual 
PM2.5 standard. Section 172(a)(2)(C) statute uses 1 year as 
the increment by which attainment date extensions can be granted. Thus, 
requiring evaluation of whether control measures would advance 
attainment by an increment of 1 year is a reasonable approach for the 
PM2.5 NAAQS.
    Comment: Some commenters recommended that EPA consider not 
requiring a RACM analysis for areas projected to attain the standards 
within 5 years of designation, i.e., by April 2010 for the areas 
currently designated nonattainment. One commenter suggested that 
practical considerations would make it impossible for any State 
projected to attain by 2010 to advance the attainment date by a year. 
This commenter noted that because measures to provide for attainment by 
2010 must be implemented by the beginning of 2009, and SIPs are not 
submitted until April 2008, it would impossible to advance the 
implementation of measures by 1 year (that is, the beginning of 2008).
    Response: The EPA generally agrees that given the time constraints 
it will be difficult for States with areas currently designated 
nonattainment to devise, adopt, and implement RACM measures to advance 
the attainment date before 2010. At the same time, however, we note 
that nothing precludes States from taking early action and we encourage 
States to take actions to reduce PM2.5 concentrations where 
feasible even before the SIPs are submitted. RACM is required by the 
CAA and thus EPA cannot waive the requirement for the analysis. At the 
same time, EPA recognizes that a streamlined analysis may be 
appropriate given the short time periods involved.
3. Observations and Considerations in Determining RACT and RACM
a. Background
    The preamble to the proposed rule included a discussion of general 
considerations for RACT (70 FR 66020 and 66021, latter part of section 
III.I.6) and RACM (70 FR 66028, section III.1.15). The preamble to the 
final rule retains this discussion with some modifications and 
restructuring to

[[Page 20617]]

reflect the combined approach to RACT and RACM
b. Final Rule
    General considerations. Once the State has identified measures and 
technologies that are available for implementation in the nonattainment 
area, then it must evaluate those measures to determine whether 
implementation of such measures are reasonable, and would collectively 
advance attainment. Many of the factors that the State should take into 
consideration in determining whether a measure is ``reasonable'' are 
related to the measure's technical and economic feasibility. Since RACM 
applies to area and mobile sources as well as stationary sources, the 
State should consider other factors as well in conducting its RACM 
analysis. For example, in many cases obtaining emissions reductions 
from area and mobile sources is achieved not by adding control 
technology to a specific emissions source, but by reducing the level of 
activity of a fleet of vehicles or by modifying a type of commercial 
process. In these situations, the State should also consider local 
circumstances such as infrastructure, population, or workforce and the 
time needed to implement the measure in light of the attainment date.
    The EPA believes that while areas projected to attain within 5 
years of designation as a result of existing national measures should 
still be required to conduct a RACT and RACM analysis, such areas may 
be able to conduct a limited RACT and RACM analysis that does not 
involve additional air quality modeling. A limited analysis of this 
type could involve the review of available reasonable measures, the 
estimation of potential emissions reductions, and the evaluation of the 
time needed to implement these measures. If the State could not achieve 
significant emissions reductions by the beginning of 2008 due to time 
needed to implement reasonable measures or other factors, then it could 
be concluded that reasonably available local measures would not advance 
the attainment date. In lieu of conducting air quality modeling to 
assess the impact of potential RACT and RACM measures, existing 
modeling information could be considered in determining the magnitude 
of emissions reductions that could significantly affect air quality and 
potentially result in earlier attainment. If the State, in consultation 
with EPA, determines from this initial, more limited RACT and RACM 
analysis that the area may be able to advance its attainment date 
through implementation of reasonable measures, then the State would 
conduct a more detailed RACT and RACM analysis.
    Observations on control opportunities. The implementation of the 
PM2.5 NAAQS is in its initial stages, and many of the 
designated PM2.5 nonattainment areas are not current or 
former PM10 nonattainment areas. Thus, some existing 
stationary sources in these areas may currently be uncontrolled or 
undercontrolled for PM2.5 or PM2.5 precursors. 
Further, to this point in time, emissions controls for existing sources 
in these areas may have focused primarily on particulate matter that is 
filterable at stack temperatures and thus may not adequately control 
condensable emissions. In addition, States should bear in mind that the 
controlled sources may have installed emission controls 15 years ago or 
more, and there may now be cost-effective opportunities available to 
reduce emissions further through more comprehensive and improved 
emissions control technologies, or through production process changes 
that are inherently lower in emissions.
    Moreover, improved monitoring methods may enhance the ability of 
sources to maintain the effectiveness of installed emissions controls 
and to reduce emissions by detecting equipment failures more quickly. 
For example, State imposition of requirements for more frequent 
monitoring (e.g., continuous opacity monitors, PM continuous emissions 
monitors, etc.) may provide greater assurance of source compliance and 
quicker correction of inadvertent upset emissions conditions than 
existing approaches.
    Even in former or current PM10 nonattainment areas, 
existing requirements for controlling direct PM emissions (e.g., with a 
baghouse or electrostatic precipitator) may not have been revised 
significantly since the 1970's. When EPA established the 
PM10 standards in 1987, we stated in the preamble that it 
was reasonable to assume that control technology that represented RACT 
and RACM for total suspended particulates (TSP) should satisfy the 
requirement for RACT and RACM for PM10. 52 FR 24672 (July 1, 
1987). The basis for EPA's belief was that controls for PM10 
and TSP would both focus on reducing coarse particulate matter, and 
specifically that fraction of particulate matter that is solid (rather 
than gaseous or condensable) at typical stack temperatures. However, 
emission controls to capture coarse particles in some cases may be less 
effective in controlling PM2.5. For this reason, there may 
be significant opportunities for sources to upgrade existing control 
technologies \28\ and compliance monitoring methods to address direct 
PM emissions contributing to fine particulate matter levels with 
technologies that have advanced significantly over the past 15 years.
---------------------------------------------------------------------------

    \28\ For example, see past EPA guidance on PM2.5 
control technologies: Stationary Source Control Techniques Document 
for Fine Particulate Matter (EPA-452/R-97-001), EPA Office of Air 
Quality Planning and Standards, October 1998.
---------------------------------------------------------------------------

    Precursor Controls. It will be important for States to conduct RACT 
and RACM determinations for stationary sources of PM2.5 
precursors as well as direct PM2.5 emissions although, as 
noted above, the known atmospheric chemistry of the area may dictate 
the necessary rigor of this analysis. A significant fraction of 
PM2.5 mass in most areas violating the standards is 
attributed to secondarily-formed components such as sulfate, nitrate, 
and some organic PM, and EPA believes that certain stationary sources 
of precursors of these components in nonattainment areas currently may 
be poorly controlled. Accordingly, to address these precursors, States 
should review existing sources for emission controls or process changes 
that could be reasonably implemented to reduce emissions from 
activities such as fuel combustion, industrial processes, and solvent 
usage.
    Multi-State Nonattainment Areas. States in multi-State 
nonattainment areas will need to consult with each other on appropriate 
level of RACT and RACM for that area. We anticipate that States may 
decide upon RACT and RACM controls that differ from State to State, 
based upon the State's determination of the most effective strategies 
given the relevant mixture of sources and potential controls in the 
relevant nonattainment areas. So long as each State can adequately 
demonstrate that its chosen RACT and RACM approach will provide for 
meeting RFP requirements and for attainment of the NAAQS as 
expeditiously as practicable for the nonattainment area at issue, we 
anticipate approving plans that may elect to control a somewhat 
different mix of sources or to implement somewhat different controls as 
RACT and RACM. Nevertheless, States should consider RACT and RACM 
measures developed for other areas or other States. EPA may consider 
such measures in assessing the approvability of a State's SIP.
c. Comments and Responses
    Comment: In the proposed rule, EPA indicated that States could 
consider the ``social acceptability'' of measures as a

[[Page 20618]]

factor in the determination of what constitutes RACM in a given area. A 
number of commenters recommended that EPA eliminate use of this factor. 
Some commenters questioned whether States or EPA had the legal 
authority to exclude measures from consideration based on social 
acceptability or popularity, if the measures are technically and 
economically available, and are needed to attain the NAAQS for 
protection of public health. Others expressed concerns that inclusion 
of such a factor would inevitably result in the elimination of controls 
for area and mobile sources and for this reason would unfairly focus 
emissions reduction strategies on industrial sources of 
PM2.5 and precursors.
    Response: The EPA believes that in developing RACM measures, it is 
important that States not rely unduly on measures that would be very 
difficult to enforce in practice. We discourage States from relying on 
measures that on paper may seem reasonably available but in practice 
might fail to achieve benefits due to the problems and costs of 
effectively enforcing these measures. However, we recognize that the 
CAA does not identify ``social acceptability'' as a factor in the 
definition of what may constitute RACT or RACM, and more generally the 
CAA does not establish a preference for measures that affect industrial 
sources instead of the general public and are therefore more likely to 
be ``socially acceptable.'' Therefore, given the concerns raised by 
commenters that establishment of ``social acceptability'' as a factor 
in the RACM analysis is without basis in the CAA and might result in 
inappropriate skewing of control strategies, we have removed this term 
from the final rule. We reiterate, however, that capability of 
effective implementation and enforcement are relevant considerations in 
the RACM analysis, even though public ``unpopularity'' is not. 
Moreover, in assessing the efficacy of measures and the credit they 
should be given in the context of attainment demonstrations or RFP 
calculations, EPA believes that such considerations are important.
4. What Factors Should States Consider in Determining Whether an 
Available Control Technology or Measure Is Technically Feasible?
a. Background
    The following provides guidance for States to consider in 
determining whether an available control technology is technologically 
feasible.
b. Final Rule
    The technological feasibility of applying an emission reduction 
method to a particular source should consider factors such as the 
source's process and operating procedures, raw materials, physical 
plant layout, and any other environmental impacts such as water 
pollution, waste disposal, and energy requirements. For example, the 
process, operating procedures, and raw materials used by a source can 
affect the feasibility of implementing process changes that reduce 
emissions and the selection of add-on emission control equipment. The 
operation and longevity of control equipment can be significantly 
influenced by the raw materials used and the process to which it is 
applied. The feasibility of modifying processes or applying control 
equipment also can be influenced by the physical layout of the 
particular plant. The space available in which to implement such 
changes may limit the choices and will also affect the costs of 
control.
    Reducing air emissions may not justify adversely affecting other 
resources by increasing pollution in bodies of water, creating 
additional solid waste disposal problems or creating excessive energy 
demands. An otherwise available control technology may not be 
reasonable if these other environmental impacts cannot reasonably be 
mitigated. For analytic purposes, a State may consider a 
PM2.5 control measure technologically infeasible if, 
considering the availability (and cost) of mitigating adverse impacts 
of that control on other pollution media, the control would not, in the 
State's reasoned judgment, provide a net benefit to public health and 
the environment. However, in many past situations, States and owners of 
existing sources have adopted PM2.5 control technologies 
with known energy penalties and some adverse effects on other media, 
based on the reasoned judgment that installation of such technology 
would result in a net benefit to public health and the environment. 
States should consider this in determining technical feasibility. The 
costs of preventing adverse water, solid waste and energy impacts 
should be included in assessing the economic feasibility of the 
PM2.5 control technology.
    One particular cross-media issue relates to concentrated animal 
feeding operations (CAFOs). Should a State determine that reductions of 
direct PM2.5 or PM2.5 precursors from CAFOs are 
necessary for attainment in a nonattainment area, EPA strongly suggests 
that the State address these reductions from a cross-media perspective. 
Since 2003, EPA and many stakeholders have been interested in 
developing a framework to enable CAFOs to pursue superior environmental 
performance across all media. We are aware that today some CAFOs 
voluntarily conduct whole-farm audits to evaluate releases of 
pollutants to all media through Environmental Management Systems, self-
assessment tools, performance track, ISO 14001 certification, and 
State-approved trade offs in meeting regulatory thresholds between air 
and water that accomplish the best overall level of environmental 
protection given State and local conditions. The EPA continues to 
believe the development of new and emerging technologies offers the 
potential to achieve equivalent or greater pollutant reductions than 
achieved solely by effluent guidelines and standards. Many of these are 
superior from a multimedia perspective, and EPA would like to encourage 
superior multimedia solutions. SIPs which need to address ammonia may 
provide a unique opportunity to encourage multimedia approaches at 
CAFOs. For example, the addition of animal by-products provides a 
valuable source of nutrients for crops, improves soil structure which 
enhances soil permeability, and adds valuable organic matter that 
improves soil health. However, inappropriate application can lead to 
air and water quality concerns or the improvement of one media at the 
cost of another. Optimal application technologies and rates reduce 
potential air and water quality standards violations. The EPA does not 
want to discourage approaches that are superior from a cross media 
perspective.
    The EPA recommends that States evaluate alternative approaches to 
reducing emissions of particulate matter by reviewing existing EPA 
guidance \29\ and other sources of control technology information. The 
EPA's 1998 guidance presents information on topics such as the design, 
operation and maintenance of general particulate matter control systems 
such as electrostatic precipitators, fabric filters, and wet scrubbers. 
The filterable particulate matter collection efficiency of each system 
is discussed as a function of particle size. The guidance document also 
provides information concerning

[[Page 20619]]

other relevant considerations such as energy and environmental 
considerations, procedures for estimating costs of particulate matter 
control equipment, and evaluation of secondary environmental impacts. 
Because control technologies and monitoring approaches are constantly 
being improved, the State should also consider more updated or advanced 
technologies not referenced in this 1998 guidance when conducting a 
RACT determination. Emissions reductions may also be achieved through 
the application of monitoring and maintenance programs that use 
critical process and control parameters to verify that emission 
controls are operated and maintained so that they more continuously 
achieve the level of control that they were designed to achieve.\30\
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    \29\ Stationary Source Control Techniques Document for Fine 
Particulate Matter (EPA-452/R-97-001), EPA Office of Air Quality 
Planning and Standards, October 1998. See also: Controlling 
SO2 Emissions: A Review of Technologies (EPA/600/R-00/
093), EPA Office of Research and Development, November 2000.
    \30\ See EPA's Web site for more information: http://www.epa.gov/ttn/emc/monitor.html.
---------------------------------------------------------------------------

c. Comments and Responses
    Comment: One commenter noted that the guidance for ``technical 
feasibility'' implies that States look at individual sources with a 
BACT-like case-by-case analysis. The commenter recommended that source 
owners conduct such a site-specific analysis and submit the analysis to 
the State through the permitting process.
    Response: While the analytical analysis to identify RACT is similar 
to BACT, as noted above, EPA in the past has issued CTGs that describe 
the presumptive norm for RACT controls for a given industry, but that 
allow for case-by-case considerations for a given source. Where States 
wished to require source owners to conduct such a site-specific 
analysis as part of the control technology review, EPA supports this 
type of process. On the other hand, EPA does not believe it would be 
appropriate to require all RACT-eligible sources to conduct such an 
analysis, given that States have the primary responsibility for 
identifying and analyzing measures for such sources.
5. What Factors Should States Consider in Determining Whether an 
Available Control Technology or Measure Is Economically Feasible?
a. Background
    The follow provides guidance for States to consider in determining 
whether an available control technology is economically feasible for 
purposes of identifying reasonably available control measures. This 
guidance is slightly modified from our proposal.
b. Final Rule
    Economic feasibility encompasses considerations such as whether the 
cost of a potential measure is reasonable considering attainment needs 
of the area and the costs of other measures, and whether the cost of a 
measure is reasonable for the regulated entity to bear, in light of 
benefits.
    While many States generally establish RACT requirements for a 
category of sources, the Act does not require the same level of control 
on all sources in a category, nor does the Act require that each source 
be controlled individually. Similar sources may have different marginal 
costs, profit margins and abilities to pass costs through to the 
consumer. These factors are appropriate to consider in determining 
whether a given level of control is appropriate for an individual 
source or category of sources. Accordingly, there is no presumption 
that a given source must bear a cost similar to any other source.
    States should consider the capital costs, annualized costs, cost 
effectiveness of an emissions reduction technology, and effects on the 
local economy in determining whether a potential control measure is 
reasonable for an area or State. One available reference for 
calculating costs is the EPA Air Pollution Control Cost Manual,\31\ 
which describes the procedures EPA uses for determining these costs for 
stationary sources. The above costs should be determined for all 
technologically feasible emission reduction options if such measure is 
inherently ``reasonably available'' (e.g., not absurd or clearly 
impractical). States may give substantial weight to cost effectiveness 
in evaluating the economic feasibility of an emission reduction 
technology. The cost effectiveness of a technology is its annualized 
cost ($/year) divided by the emissions reduced (i.e., tons/year) which 
yields a cost per amount of emission reduction ($/ton). Cost 
effectiveness provides a value for each emission reduction option that 
is comparable with other options and other facilities. Where multiple 
control options exist for a given source or source category, States 
should consider both the cost effectiveness (dollars per ton) of each 
option, and the incremental cost effectiveness per ton between the 
options (incremental increase in cost between options divided by the 
incremental tons reduced).
---------------------------------------------------------------------------

    \31\ EPA Air Pollution Control Cost Manual--Sixth Edition (EPA 
452/B-02-001), EPA Office of Air Quality Planning and Standards, 
Research Triangle Park, NC, Jan 2002.
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    In determining whether a given measure is reasonable, States may 
consider costs per ton of other measures previously employed to reduce 
that pollutant, but similar costs are not conclusive. As discussed 
above, States may evaluate equity considerations in weighing the 
economic feasibility of imposing a measure on a given source or source 
category.
    We anticipate that States may decide upon RACT and RACM controls 
that differ from State to State, based on the State's determination of 
the most effective strategies given the relevant mixture of sources and 
potential controls in the relevant nonattainment areas, and differences 
in the difficulty of reaching attainment.
    In considering what level of control is reasonable, EPA is not 
proposing a fixed dollar per ton cost threshold for RACT, consistent 
with the views of multiple commenters. Areas with more serious air 
quality problems typically will need to obtain greater levels of 
emissions reductions from local sources than areas with less serious 
problems. Where essential reductions are more difficult to achieve 
(e.g., because many sources are already controlled), the cost per ton 
of control may necessarily be higher.
    It is not appropriate to assume that the same cost per ton range is 
reasonable for direct PM2.5 and different precursors, 
because an equal amount of emission reduction in different pollutants 
has a different impact on PM2.5 ambient levels. For example, 
in a given nonattainment area, reductions of direct PM2.5 
emissions may prove more expensive than reductions of NOX 
emissions, but the resulting benefits of reductions of direct 
PM2.5 might warrant the higher costs. A State should 
consider this differential impact on ambient PM2.5 in 
considering RACT for controlling different pollutants. During the SIP 
process, States and regional planning organizations typically conduct 
sensitivity modeling that can provide this information. Also, the PM 
NAAQS RIA provides information on the differential impact of 
PM2.5 and PM precursor reductions on ambient 
PM2.5 levels in various areas.\32\
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    \32\ See: U.S. EPA 2006. Regulatory Impact Analysis for the 
Particulate Matter National Ambient Air Quality Standards. Air 
Benefits and Cost Group, Office of Air Quality Planning and 
Standards, Research Triangle Park, NC, October 6, 2006. Appendix A 
provides an analysis of estimated benefits and costs of attaining 
the 1997 PM NAAQS standards in 2015.
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    One of the factors that could affect estimated compliance costs of 
an emission reduction measure is the timing of its implementation. 
Hypothetically, if a short compliance period were contemplated for a 
set of sources, and if the short compliance

[[Page 20620]]

period resulted in high demand for a limited supply of labor or other 
resources, compliance costs could be higher than if the same measure 
were implemented by a later compliance date. In such a case it may be 
reasonable for the State to find that the measure is reasonable only if 
implemented by the later date.
    If a source contends that a source-specific RACT level should be 
established because it cannot afford the technology that appears to be 
RACT for other sources in its source category, the source can support 
its claim with such information as:

--Fixed and variable production costs ($/unit)
--Product supply and demand elasticity,
--Product prices (cost absorption vs. cost pass-through),
--Expected costs incurred by competitors,
--Company profits once the technology or measure is in operation 
(considering the annualized costs and the marginal costs of alternative 
technologies and measures),
--Employment costs, and
--Any other unique factor(s) particular to the individual source.

    Finally, the EPA clarifies that if the State demonstrates through 
economic analysis that the imposition of the measure would cause 
unacceptable economic disruption for the local economy, that is, a 
plant shutdown or a severe curtailment in plant employment or output, a 
State may reject the measure as not reasonable to reach attainment as 
expeditiously as practicable.
c. Comments and Responses
    Comment: Some commenters agreed with EPA's proposal not to 
establish presumptive cost-effectiveness thresholds.
    Response: The EPA agrees with the commenters.
    Comment: A number of commenters expressed concerns over the 
references to health benefits as a consideration in whether measures 
are technically or economically available. Some commenters believed 
this is a consideration not authorized by the CAA. Others believed that 
consideration of benefits, in combination with EPA's estimates of 
benefits per ton, would have the effect of converting RACT to more 
stringent LAER levels. Some commenters expressed concerns whether 
States had the resources or expertise to conduct cost-benefit analyses 
for this purpose.
    Response: The EPA wishes to clarify that the reference to health 
benefits does not mean that a cost-benefit, or a detailed health 
benefits assessment, is a necessary part of a control strategy 
demonstration. We also wish to clarify that EPA is not requiring that 
the costs of all technologies and measures for PM2.5 and 
precursors be deemed acceptable at any dollar/ton levels at or below 
the calculated monetized benefits per ton of reduction. We do, however, 
continue to believe that the significant benefits associated with 
PM2.5 ambient reductions is a relevant consideration in 
control strategy development. The EPA disagrees that this limited 
consideration of benefits would convert the RACT process to the 
equivalent of LAER.
    Comment: One commenter objected to EPA's proposed requirement that 
States consider competitive factors such as production costs, demand 
elasticity, product prices, and cost incurred by competitors in the 
determination of RACT. The commenter believed that this information is 
generally not accessible to States or industrial facility owners, and 
is not necessary for a RACT determination.
    Response: The EPA generally disagrees that this type of information 
is unavailable. For example, EPA calculates or reviews this type of 
data on a regular basis as part of our work on MACT, NSPS, and other 
emissions standards. A document that describes these types of analyses 
and the data used to prepare them is the OAQPS Economic Resource Manual 
found at http://www.epa.gov/ttn/ecas/analguid.html. EPA believes that 
this issue is most relevant to category-wide RACT rules where a source 
seeks a case-by-case exemption. Further, EPA believes most RACT 
determinations will be developed through case-by-case analyses rather 
than rules affecting entire source categories. Accordingly, this 
analysis likely will be relevant in few cases.
6. What Specific Source Categories and Control Measures Should a State 
Evaluate When Determining RACT and RACM for a Nonattainment Area?
a. Background
    Section 172 does not provide a specific list of source categories 
and control measures that must be evaluated for RACT and RACM for 
PM2.5. However, section 172(c)(3) indicates that the 
attainment plan must include a ``comprehensive, accurate, current, 
inventory of actual emissions from all sources of the relevant 
pollutant.'' This indicates that States should look broadly at the 
different types of sources in the nonattainment area. We recognize that 
PM2.5 is a new NAAQS without a long history of 
implementation as with ozone. Therefore, we included a list of 
potential RACM measures in the preamble to the proposed rule, based 
upon a review of information about the contribution of various sources 
to emissions inventories and a review of potential control measures for 
such sources. We requested comment on the specific sources and 
potential control measures recommended for RACM analysis on this list. 
Based on comments received and additional information available to EPA 
since the proposal, we have made some changes to the list. We also 
refer to this list of potential ``RACT and RACM'' measures for the 
combined approach to RACT and RACM in the final rule.
    In the preamble to the proposed rule, EPA indicated that due to the 
short time available, it does not plan to develop new control 
techniques guidance (CTG) or ACT documents specifically for purposes of 
PM2.5 implementation. The EPA indicated that other 
information was available on control technologies, and EPA also 
indicated its intention to maintain an updated list of references for 
new PM2.5 control technology information.
b. Final Rule
    Emission reduction measures constituting RACM should be determined 
on an area-by-area basis. We believe that a State should consider each 
of the measures listed in this section to determine if each measure is 
reasonably available in the applicable nonattainment area. However, we 
do not presume that each of these measures is reasonably available in 
each nonattainment area.
    We recommend that each State use the list of source categories in 
this section as a starting point for identifying potentially available 
control strategies (regulatory and voluntary) for a nonattainment area. 
States are encouraged and expected to add other potentially available 
measures to the list based on its knowledge of the particular universe 
of emissions sources in the area and comments from the general public. 
We expect that, depending on the potential measure being analyzed, the 
State's degree of evaluation will vary as appropriate. Detailed 
information on emission control technologies is available from a number 
of sources.\33\ The EPA intends to maintain a website with links to 
sources of information for

[[Page 20621]]

controlling emissions of direct particulate matter and PM precursors.
---------------------------------------------------------------------------

    \33\ There are a number of sources of information on 
technologies for reducing emissions of PM2.5 and its 
precursors. Links are provided to a number of national, state and 
local air quality agency sites from EPA's PM2.5 Web site: 
http://www.epa.gov/pm/measures.html.
---------------------------------------------------------------------------

    As discussed in section II.J.5. above, EPA recognizes that control 
technology guidance for certain source categories has not been updated 
for many years. Section 183(c) of the CAA, which addresses control 
technologies to address ozone nonattainment problems, requires EPA to 
``revise and update such documents as the Administrator determines 
necessary.'' As new or updated information becomes available States 
should consider the new information in their RACT determinations. A 
State should consider the new information in any RACT determinations or 
certifications that have not been issued by the State as of the time 
such updated information becomes available.

Stationary Source Measures

--Stationary diesel engine retrofit, rebuild or replacement, with 
catalyzed particle filter
--New or upgraded emission control requirements for direct 
PM2.5 emissions at stationary sources (e.g., installation or 
improved performance of control devices such as a baghouse or 
electrostatic precipitator; revised opacity standard; improved 
compliance monitoring methods)
--Improved capture of particulate emissions to increase the amount of 
PM2.5 ducted to control devices, and to minimize the amount 
of PM2.5 emitted to the atmosphere, for example, through 
roof monitors
--New or upgraded emission controls for PM2.5 precursors at 
stationary sources (e.g., SO2 controls such as wet or dry 
scrubbers, or reduced sulfur content in fuel; desulfurization of coke 
oven gas at coke ovens; improved sulfur recovery at refineries; 
increasing the recovery efficiency at sulfuric acid plants)
--Energy efficiency measures to reduce fuel consumption and associated 
pollutant emissions (either from local sources or distant power 
providers)
--Measures to reduce fugitive dust from industrial sites

Mobile Source Measures

--Onroad diesel engine retrofits for school buses,\34\ trucks and 
transit buses using EPA-verified technologies
---------------------------------------------------------------------------

    \34\ See Clean School Bus USA program at http://www.epa.gov/cleanschoolbus/. See also: ``What You Should Know About Diesel 
Exhaust and School Bus Idling,'' (June 2003, EPA420-F-03-021) at 
http://www.epa.gov/otaq/retrofit/documents/f03021.pdf.
---------------------------------------------------------------------------

--Nonroad diesel engine retrofit, rebuild or replacement, with 
catalyzed particle filter \35\
---------------------------------------------------------------------------

    \35\ See EPA's voluntary diesel retrofit program Web site at 
http://www.epa.gov/otaq/retrofit/overfleetowner.htm.
---------------------------------------------------------------------------

--Diesel idling programs for trucks, locomotive, and other mobile 
sources \36\
---------------------------------------------------------------------------

    \36\ See EPA's voluntary diesel retrofit program Web site at 
http://www.epa.gov/otaq/retrofit/idling.htm.
---------------------------------------------------------------------------

--Transportation control measures (including those listed in section 
108(f) of the CAA as well as other TCMs), as well as other 
transportation demand management and transportation systems management 
strategies \37\
---------------------------------------------------------------------------

    \37\ See EPA's Web site on transportation control measures at 
http://www.epa.gov/otaq/transp/traqtcms.htm.
---------------------------------------------------------------------------

--Programs to reduce emissions or accelerate retirement of high 
emitting vehicles, boats, and lawn and garden equipment
--Emissions testing and repair/maintenance programs for onroad vehicles
--Emissions testing and repair/maintenance programs for nonroad heavy-
duty vehicles and equipment \38\
---------------------------------------------------------------------------

    \38\ See EPA's Web site on nonroad engines, equipment, and 
vehicles at http://www.epa.gov/otaq/nonroad.htm.
---------------------------------------------------------------------------

--Programs to expand use of clean burning fuels \39\
---------------------------------------------------------------------------

    \39\ Fuels adopted in SIPs must be consistent with the Energy 
Policy Act of 2005 and EPA guidance on SIP-approved boutique fuels 
at 71 FR 78192 (December 28, 2006).
---------------------------------------------------------------------------

--Low emissions specifications for equipment or fuel used for large 
construction contracts, industrial facilities, ship yards, airports, 
and public or private vehicle fleets
--Opacity or other emissions standards for ``gross-emitting'' diesel 
equipment or vessels

Area Source Measures

--New open burning regulations and/or measures to improve program 
effectiveness such as programs to reduce or eliminate burning of land 
clearing vegetation
--Programs to reduce emissions from woodstoves and fireplaces including 
outreach programs, curtailments during days with expected high ambient 
levels of PM2.5, and programs to encourage replacement of 
woodstoves when houses are sold
--Controls on emissions from charbroiling or other commercial cooking 
operations
--Reduced solvent usage or solvent substitution (particularly for 
organic compounds with 7 carbon atoms or more, such as toluene, xylene, 
and trimethyl benzene)
    Category-Specific Guidelines on innovative approaches. The EPA has 
issued a number of category specific guidelines on approaches to taking 
into account innovative approaches to emissions reductions for purposes 
of SIPs. Categories currently covered by these guidelines include: (1) 
Electric-sector Energy Efficiency and Renewable Energy Measures; (2) 
Long Duration Switch Yard Locomotive Idling; (3) Long Duration Truck 
Idling; (4) Clean Diesel Combustion Technology; and (5) Commuter Choice 
Programs. See http://www.epa.gov/ttn/airinnovations/measure_specific.html. 
c. Comments and Responses
    Comment: Some commenters recommended that EPA provide new CTGs or 
other control technology review documents for purposes of assisting 
States to address PM2.5 and its precursors, because the 
information in some current documents is out-dated.
    Response: The EPA recognizes that issuance of new or updated CTGs 
specifically tailored for PM2.5 would be useful. 
Unfortunately, limitations on time and resources preclude EPA from 
developing such CTGs in advance of the SIP submission date. The EPA 
cannot delay the statutorily specified outer date for SIP submission. 
However, EPA believes that there are already many sources of 
information and guidance on key source categories. To the extent that 
States need to examine potential control measures for sources never 
addressed before in any area or other context for a previous NAAQS, EPA 
anticipates that it will work closely with States during the process of 
plan development and approval to ensure an appropriate approach.
    Comment: A number of commenters expressed concerns with references 
to the STAPPA and ALAPCO Menu of Options document. Some commenters 
believed that this document must be subject to formal review and 
comment to ensure appropriate stakeholder input.
    Response: The language in the final preamble has been changed to 
refer to a Web site EPA maintains that provides access to a variety of 
information sources regarding control technologies that may be useful 
to States to consider in developing their PM2.5 SIPs. These 
links include evaluations developed by government and nongovernment 
organizations. One such source with potentially useful information is 
the STAPPA and ALAPCO Menu of Options. However, EPA is not specifically 
endorsing any of the specific evaluations as being appropriate in any 
specific situation. Rather, we think documents such as the

[[Page 20622]]

Menu of Options provide potentially useful ideas. Specifically, States 
would need to assess which items on the menu are applicable in their 
areas, and will have to assess the costs of applying controls locally. 
Accordingly, there would be ample opportunity for public review of the 
State's analysis of the local cost and air quality impacts of any 
measure listed in the document which is included in a State's SIP. The 
EPA is not requiring that States adhere to the list of measures in the 
Menu of Options. The EPA does not in any way mean to imply that the 
measures in the Menu of Options are presumed to be RACM, merely that 
they are potential controls for areas to consider. The Menu of Options 
has no regulatory significance and thus need not be issued through 
notice-and-comment rulemaking. The EPA notes, however, that the Menu of 
Options does provide a broad list of potential sources and measures 
that can help inform States in the development of their plans. 
Similarly, our own list of potential measures is not intended to be a 
categorical list of measures which States must adopt, rather it is 
intended to provide guidance about the types of sources and measures 
that States can consider in constructing their attainment plans. The 
EPA emphasizes that whether a source category or potential measure is 
or is not on this list is simply not conclusive as to whether a given 
measure is appropriate to consider in the RACT and RACM analysis. That 
can be determined only through the State's development of the 
attainment plan, and EPA's evaluation of such plan.
    Comment: A commenter representing the paper industry interpreted 
the proposed rule as requiring electrostatic precipitator and tighter 
sulfur-in-fuel requirements for the forest products industry. The 
commenter believed that EPA was creating limits for such sources 
without adequate rulemaking process.
    Response: The EPA disagrees that the listing of control 
technologies in the table in the rule creates a ``rebuttable 
presumption.'' Rather, the table identifies potential opportunities for 
emissions reductions which should be reviewed in light of technical and 
economic feasibility, and which a State should consider in a list of 
possible RACT and RACM measures for purposes of attaining the standards 
as expeditiously as practicable. The EPA is currently conducting a 
sector-based approach to the paper industry. One of the goals of the 
sector initiative on pulp and paper is to work with the industry to 
identify reductions in SO2 and PM2.5 that will 
assist us in meeting the NAAQS, considering facility locations, 
magnitude of emissions, emission stream characteristics, and cost 
effectiveness of controls.
    Comment: A number of commenters believed that EPA should develop 
not only a list of measures to consider for RACM, but should develop a 
list of mandatory measures that States should include, particularly for 
areas with attainment dates more than 5 years after designation.
    Response: See discussion in section II.D.3 regarding rule 
requirements for attainment date extensions and the issue of whether 
certain measures should be mandatory in order for an area to receive an 
extension.
    Comment: Some commenters believed that the list of possible 
measures was deficient in not including sources of PM2.5 and 
PM2.5 precursors from agricultural sources. One commenter 
believed the list is incomplete without identifying the contribution of 
ammonia emissions associated with livestock, poultry, and crop 
fertilizers.
    Response: As we indicated in the proposal, we included a list of 
potential RACM measures in the preamble to the proposed rule, based 
upon a review of information about the contribution of various sources 
to the emissions inventories and a review of potential control measures 
for such sources. We did not identify emissions from agricultural 
sources in this review. Because ammonia is not presumed to be a 
PM2.5 precursor unless identified for a specific area by the 
State or EPA, regulation of ammonia emissions from agricultural sources 
may not be necessary.
    We also note that the agricultural industry presents unique 
challenges to regulators given the nature of relevant emissions 
sources. Moreover, we currently lack good methods to quantify 
agricultural emissions, and we do not fully understand their 
contribution to nonattainment problems. We have entered into an 
agreement with several animal producer sectors to monitor animal 
feeding operations to develop better tools to assess emissions from 
this industry. Hopefully, these tools will enhance our knowledge of 
agricultural emissions and their contribution to nonattainment 
problems. Until emissions from these sources are better understood, 
States should be judicious in determining whether any specific measure 
is RACT/RACM for this industry.
    The EPA recognizes that the United States Department of Agriculture 
(USDA) has been working with the agricultural community to develop 
conservation systems and activities to control coarse particle 
emissions. Based on current ambient monitoring information, these USDA-
approved conservation systems and activities have proven to be 
effective in controlling these emissions in areas where coarse 
particles emitted from agricultural activities have been identified as 
a contributor to a violation of the PM10 NAAQS. The EPA has 
found that where USDA-approved conservation systems and activities have 
been implemented, these systems and activities have satisfied the 
Agency's reasonably available control measure and best available 
control measure requirements for areas needing to attain the 
PM10 standards.
    The EPA believes that in the future, certain USDA-approved 
conservation systems and activities that reduce agricultural emissions 
of fine particles may be able to satisfy the requirements of applicable 
sources to implement reasonably available control measures for purposes 
of attaining the PM2.5 NAAQS. The EPA will work with States 
to identify appropriate measures to meet their RACM requirements, 
including site-specific conservation systems and activities. The EPA 
will continue to work with USDA to prioritize the development of new 
conservation systems and activities; demonstrate and improve, where 
necessary, the control efficiencies of existing conservation systems 
and activities; and ensure that appropriate criteria are used for 
identifying the most effective application of conservation systems and 
activities.
    Comment: Some commenters raised concerns about a statement in the 
proposal that ``[i]n addressing a nonattainment area having military 
training, testing and operational activities occurring within it, the 
State should not need to target these activities for emission 
reductions.'' Some commenters interpreted this statement as an 
exemption from any emission reduction requirements for military 
sources.
    Response: The statement in the proposal was not intended as an 
exemption for all military activities. Emissions potentially 
contributing to PM2.5 concentrations at military 
installations originate from a variety of sources: basic operational 
activities (such as power generation, other fuel combustion, and 
transportation to and from residences, offices, and schools); and from 
field training and testing activities (such as personnel training, 
obscurants used in training, operation of nonroad vehicles and 
equipment, and related prescribed burning operations). The EPA believes 
that in evaluating emissions for a specific nonattainment

[[Page 20623]]

area having military activities occurring within it, the State should 
consult with DOD for information on the nature of these activities and 
their associated emissions.
    With regard to military training activities specifically, such 
activities are periodic in nature, and when they do occur, the 
principal type of emissions generated by these activities is dust (i.e. 
inorganic direct PM emissions) from field operations. Other pollutants 
may be emitted to a lesser degree from certain onroad and nonroad motor 
vehicles. While military training activities may contribute some degree 
of primary PM2.5 emissions to certain nonattainment area 
inventories, the fugitive dust generated from military training 
activities is predominantly composed of coarse PM rather than fine PM.
    Based on data from the PM2.5 speciation monitoring 
network operated by EPA and the States, the contribution of inorganic 
dust to total PM2.5 mass on an annual average basis is 
relatively low in most nonattainment areas, on the order of 0.5 to 1.5 
micrograms per cubic meter (generally 10% or less of total 
PM2.5 mass). Dust from military training activities would be 
a subset of these levels. Depending on the available information and 
specific circumstances for a particular area, a State could find in its 
SIP development analyses that direct PM2.5 emissions from 
military training activities do not significantly contribute to 
PM2.5 concentrations in the nonattainment area, and 
therefore would not need to target military training activities for 
emission reductions in its attainment plan.\40\
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    \40\ Windblown dust from agricultural tilling activities also 
can be a periodic source of inorganic PM in some areas. In some 
cases such dust would be expected to be predominantly composed of 
coarse PM rather than fine PM. Depending on the available 
information and specific circumstances for a particular area, it is 
possible that a State could find in its SIP development analyses 
that direct PM2.5 emissions from agricultural tilling 
activities do not significantly contribute to annual average 
PM2.5 concentrations in the nonattainment area, and 
therefore would not need to require emission reductions from 
agricultural tilling activities in the plan for attaining the annual 
standard. However, States should be mindful of the contribution of 
these sources to 24-hour fine particle concentrations.
---------------------------------------------------------------------------

7. How Should States Consider EGU Reductions for CAIR in Meeting RACT/
RACM Requirements?
a. Background
    In section III.I.11 of the preamble to the proposed rule, we 
discussed the nature of the SO2 and NOX RACT 
obligations of electric generating unit (EGU) sources in states subject 
to the CAIR emission reduction requirements. The CAIR rulemaking was 
finalized in March 2005 and published at 70 FR 25221 (May 12, 2005). 
CAIR requires 28 states and the District of Columbia to significantly 
reduce emissions of SO2 and/or NOX. The 26 
jurisdictions in the CAIR PM2.5 region are required to 
reduce annual emissions of SO2 and NOX, and the 
26 jurisdictions in the CAIR ozone region are required to reduce 
seasonal emissions of NOX. These jurisdictions also have the 
option of participating in EPA-administered annual SO2, 
annual NOX, and seasonal NOX cap-and-trade 
programs (the CAIR trading programs) to meet these emission reduction 
requirements. In addition, in March 2006, EPA promulgated a Federal 
implementation plan (FIP) to implement CAIR in these jurisdictions 
until they have EPA approved CAIR SIPs in place (71 FR 25328, April 28, 
2006). The FIP adopts, as the control measure, the CAIR trading 
programs slightly modified to allow for Federal instead of State 
implementation. When fully implemented, CAIR will reduce SO2 
emissions in these jurisdictions by over 70 percent and NOX 
emissions by over 60 percent from 2003 levels. This will result in $85 
to $100 billion in health benefits and nearly $2 billion in visibility 
benefits per year by 2015 and will substantially reduce premature 
mortality in the eastern United States. The benefits will continue to 
grow over time as the program is fully implemented (i.e., the 
SO2 emission bank is depleted and the final cap is met), and 
as growth in populations and the aging of the population continues 
(which increases the susceptible population).
    Sources subject to cap-and-trade programs such as the CAIR trading 
programs generally have the option of installing emissions control 
technology, adopting some other strategy to reduce emissions, or 
purchasing emissions allowances and thereby effectively paying other 
sources covered by the cap to reduce emissions. In the proposal, we 
noted that a number of EGUs expected to be covered by the CAIR trading 
programs are located in nonattainment areas. Based on emissions 
projections for 2010 and 2015 using the Integrated Planning Model 
(IPM), some of these EGUs are expected to comply with CAIR by 
purchasing allowances under the trading program and some are expected 
to comply by installing emission controls.
    The proposal also described our past experience with the 
implementation of the NOX SIP Call and our belief that many 
power companies will develop their strategies for complying with CAIR 
based, in part, on consultations with State and local air quality 
officials in order to address local PM2.5 and ozone 
attainment planning needs. The EPA suggested that consultations on 
location of CAIR controls would be timely during State development of 
the CAIR SIP, which is due in 2006, prior to the April 2008 deadline 
for submitting PM2.5 nonattainment area SIPs.
    The EPA proposed a determination that in States that fulfill their 
CAIR SO2 emission reductions entirely through EGU emission 
reductions (i.e. without reductions from non-EGU sources or allowing 
non-EGU sources to opt-in to the CAIR SO2 trading program), 
participation in the CAIR SO2 trading program would satisfy 
the SO2 RACT requirement for the EGU sources. The EPA also 
proposed that in states that fulfill their CAIR NOX emission 
reductions entirely through EGU emission reductions, CAIR would satisfy 
NOX RACT for the EGU sources, provided that those sources 
with existing selective catalytic reduction (SCR) emission control 
technology installed on their boilers operate that technology on a 
year-round basis beginning in 2009. Note that direct PM2.5 
emissions are not addressed by the CAIR program, and EPA did not 
propose any determination that compliance with CAIR would satisfy RACT 
for direct PM2.5 emissions. The proposal included a 
discussion of the rationale for these proposed determinations for 
SO2 and NOX, and requested comments on the issue.
b. Final Rule
    As discussed in section II.F.2 on our overall policy for RACT and 
RACM, we consider an area's obligation to implement RACT to be part of 
the area's overall RACM obligation--to adopt those reasonably available 
measures needed to reach PM2.5 attainment as expeditiously 
as practicable. The final rule also reflects this combined RACT/RACM 
approach regarding EGU control obligations under CAIR and the extent to 
which meeting CAIR also satisfies a source's RACT and RACM requirements 
for attainment.
    Specifically, the final rule includes a presumption that in States 
that fulfill their CAIR SO2 emission reduction requirements 
entirely through EGU emission reductions (i.e. without reductions from 
non-EGU sources or allowing non-EGU sources to opt in to the CAIR 
SO2 trading program), compliance by EGU sources with an EPA-
approved CAIR SIP or a CAIR FIP would satisfy their SO2 
RACT/RACM requirements for attaining the fine particle NAAQS. This 
section also includes a presumption that in States

[[Page 20624]]

that are subject to CAIR annual NOX emission reduction 
requirements and fulfill these requirements entirely through EGU 
emission reductions (i.e. without reductions from non-EGU sources or 
allowing non-EGU sources to opt in to the CAIR annual NOX 
trading program), compliance by EGU sources with an EPA-approved CAIR 
SIP or a CAIR FIP would satisfy the NOX RACT/RACM 
requirement for the PM2.5 NAAQS, provided that the sources 
with existing selective catalytic reduction (SCR) emission control 
technology installed on their boilers operate that technology on a 
year-round basis beginning in 2009. This final position is based on a 
number of factors identified in the proposal and discussed below.
    Many PM2.5 nonattainment areas are projected to achieve 
significant SO2 and NOX reductions under the CAIR 
program. We do not believe that requiring source-specific RACT/RACM 
controls on specified EGUs in nonattainment areas would reduce total 
SO2 and NOX emissions from sources covered by 
CAIR below the regionwide levels that will be achieved under CAIR 
alone. Nor do we believe that ``beyond CAIR'' EGU controls for 
SO2 and NOX are ``reasonably available'' control 
measures for most areas within the CAIR Region. Accordingly, most 
States need not evaluate additional control measures on EGUs to satisfy 
RACT/RACM requirements as explained above.
    As discussed previously, we are not requiring that States impose 
RACT on any specific size or type of source. Instead, States must 
conduct a RACT/RACM analysis considering measures that are ``reasonably 
available'' to meet the overarching requirement to attain the standards 
as expeditiously as practicable. Thus, the final rule imposes no 
specific requirement on States to impose RACT/RACM on EGUs.
    Nonetheless, in evaluating RACT/RACM for EGUs, EPA believes it is 
appropriate for States (states that achieve all reductions from EGUs) 
to consider the special attributes of that group of facilities 
including the unique interrelated nature of the power supply network, 
and their participation in the CAIR program. For EGUs in the CAIR 
region, based upon the presumption explained here, States may define 
RACT/RACM as the CAIR level of control on the collective group of 
sources in the region rather than impose a specific level of control on 
an individual source. This approach is similar to the Agency's past 
``bubble'' policy, as discussed in section (c) addressing comments on 
the proposal.
    As discussed more fully in the CAIR final rulemaking notice, EPA 
has set the 2009 and 2010 CAIR caps for SO2 and 
NOX at a level that will require EGUs to install emission 
controls on the maximum total capacity on which it is feasible to 
install emission controls by those dates. The EPA concluded that the 
CAIR compliance dates represent an aggressive schedule that reflects 
the limitations of the labor pool, and equipment/vendor availability, 
and need for electrical generation reliability for installation of 
emission controls.
    Although the actual SO2 cap does not become effective 
until 2010, we designed banking provisions in CAIR so that covered EGUs 
will begin to reduce their SO2 emissions almost immediately 
after CAIR is finalized, and will continue steadily to reduce their 
emissions in anticipation of the 2010 cap and the more stringent cap 
that becomes effective in 2015. The 2015 SO2 and 
NOX caps are specifically designed to eliminate all 
SO2 and NOX emissions from EGUs that are highly 
cost effective to control (the first caps represent an interim step 
toward that end).
    Moreover, we predicted that the majority of large coal-fired 
utilities will install advanced control technologies under CAIR because 
the larger and higher emitting source offer an opportunity to obtain 
more cost-effective emissions reductions. We expect that the largest-
emitting sources will be the first to install SO2 and 
NOX control technology and that such control technology will 
gradually be installed on progressively smaller-emitting sources until 
the ultimate cap is reached. As a result, few, if any coal-fired units 
with greater than 600 MW of operating capacity should operate in 
PM2.5 nonattainment areas without advanced control after 
full implementation of CAIR. Of the remaining units operating without 
advanced pollution controls, a great many of these units will have 
operating capacities below 300 MW. We predict that these units ``will 
be utilized less often,'' and ``typically have baghouses and 
electrostatic precipitators for particulate control, have combustion 
controls for NOX control, and burn low-sulfur coal.'' See 
``Contributions of CAIR/CAMR/CAVR to NAAQS Attainment: Focus on Control 
Technologies and Emission Reductions in the Electric Power Sector,'' 
Office of Air and Radiation, U.S. Environmental Protection Agency, 
April 18, 2006 (available at http://www.epa.gov/airmarkets/cair/analyses/naaqsattainment.pdf). In light of these expected results, we 
generally believe that the cost to install additional controls on these 
smaller units would be unreasonable.
    We are also concerned that if States require specific EGUs to 
install advanced pollution control measures, it could interfere with 
the market-based incentives inherent in the cap and trade program. This 
could increase the cost of compliance and shift the location of the 
units that would otherwise opt to install advanced emissions controls. 
Such a result may be counterproductive to that State's attainment 
efforts, as the State may forego a larger quantity of more beneficial 
reductions in transported pollutants, in exchange for a smaller 
quantity and less beneficial reduction in local emissions. Moreover, it 
may reduce the benefits expected in other nonattainment areas as well. 
Accordingly, even if a State found the cost to control an individual 
unit acceptable on a cost per ton basis, the potential overall 
disbenefit of control may nonetheless make imposition of the control 
not ``reasonably available.''
    The EPA finds that the control installations projected to result 
from CAIR NOX and SO2 caps in 2009 and 2010 are 
as much as feasible from EGUS across the CAIR Region by those dates. In 
fact, if states chose to require smaller-emitting sources in 
nonattainment areas to meet source-specific RACT requirements by 2009, 
they would likely use labor and other resources that would otherwise be 
used for emission controls on larger sources. Because of economies of 
scale, more boiler-makers may be required per megawatt of power 
generation for smaller units than larger units. In this case, the 
imposition of source-specific RACT/RACM on smaller emitting sources by 
2009 could actually reduce the amount of banking that would otherwise 
occur and result in higher SO2 emissions in 2009 as compared 
to the level that would result from implementation of CAIR alone.
    In any event, the imposition of source-specific control 
requirements on a limited number of sources also covered by a cap-and-
trade program would not reduce the total regionwide emissions from 
sources subject to the program. Under a cap-and-trade program such as 
CAIR, a given number of allowances are issued in order to achieve a 
given emission level. Source-specific control requirements within the 
CAIR program may affect the temporal distribution of emissions (by 
reducing banking and thus delaying early reductions) or the spatial 
distribution of emissions (by moving them around from one place to 
another), but they would not affect total regional emissions under the 
program. If source-specific requirements were targeted at the units

[[Page 20625]]

that could be controlled most cost-effectively, then the imposition of 
source-specific controls would likely achieve the same result as the 
cap-and-trade program. If not, however, the imposition of source-
specific requirements would make any given level of emission reduction 
more costly than it would be under the cap-and-trade program alone. 
Thus, the imposition of source-specific RACT on EGUs covered by CAIR 
would not reduce total regionwide emissions, but would likely achieve 
emission reductions under the program in a more costly way.
    Given the considerations described above, we think that in many 
areas additional controls on EGUs generally would not be ``reasonably 
available.'' Notwithstanding these conclusions, we recognize that 
States are in the best position to determine how best to achieve 
attainment with the PM2.5 NAAQS in light of local needs and 
conditions. As we acknowledged in our proposed rule, power plant 
operators typically have ongoing relationships with the State and local 
officials involved in air quality planning. We expect that power plants 
will continue to collaborate with State officials to determine how best 
to address multiple air quality goals, and which plant locations to 
control under CAIR, considering local PM2.5 and ozone 
attainment needs.
    The EPA expects States and local air agencies to identify 
reasonably available control measures that are necessary and reasonable 
to attain the standards as expeditiously as practicable; and that after 
consulting with power companies, the State may conclude that 
establishing additional ``beyond CAIR'' emission control requirements 
on specific sources in nonattainment areas is warranted to provide for 
attainment as expeditiously as practicable. Nevertheless, in preparing 
the overall attainment demonstration, States should be aware of the 
expected benefits of the market-based incentives of the CAIR program, 
the cost effectiveness of control, feasibility of implementation, and 
any disbenefits that would result from requiring ``beyond CAIR'' 
controls on any specific EGU before concluding that additional controls 
on EGUs are ``reasonably available'' and necessary to satisfy RACT/RACM 
requirements.
    Year-round NOX controls. In the CAIR final rulemaking 
notice, EPA found that the operation of existing SCRs on a year-round 
basis, instead of operating them only during the ozone season, could 
achieve NOX reductions at low cost relative to other 
available NOX controls. The EPA projected that power 
generators would employ this control measure to comply with CAIR SIPs. 
Based on this control opportunity, EPA estimated the average cost of 
non-ozone-season NOX control at $500/ton. These 
considerations support a finding that RACT should include year-round 
operation of existing SCRs that are located in PM2.5 
nonattainment areas. Because all PM2.5 nonattainment areas 
violate the annual form of the PM2.5 standard and public 
health can be affected by high PM2.5 levels in the winter as 
well as the summer, we believe that year-round operation of existing 
SCR that are located in nonattainment areas where NOX is an 
attainment plan precursor will provide additional health benefits for 
relatively low dollar cost per ton of pollutant reduced.
    In the proposal notice, EPA proposed to define ``existing'' SCRs as 
those units that were in place by the date of the proposed rule 
(November 1, 2005). We selected this date rather than the final date to 
avoid creating an incentive to delay installation of new SCR. Today, we 
finalize our proposed approach with one clarification. To avoid 
confusion over the proper interpretation of the phrase ``in place,'' we 
are clarifying that an existing SCR is one which is fully installed and 
capable of operation by November 1, 2005.
    We also proposed that these existing SCR begin year-round 
operations no later than January 1, 2009 to qualify as RACT/RACM under 
our presumptive approach. We noted that year round operation of 
existing SCR involves little to no alteration of existing equipment, 
and that EGUs could conduct any required work during normal outages. 
Today, after taking these factors into account, we finalize our 
proposed rule. The year-round operation requirement, however, will not 
be federally enforceable to individual EGUs until EPA approves a 
State's SIP including the requirement.
c. Comments and Responses
    Comment: Some commenters supported the proposed determination 
described in section (a) that in States that fulfill their CAIR 
SO2 emission reduction requirements entirely through EGU 
emission reductions (i.e. without reductions from non-EGU sources or 
allowing non-EGU sources to opt in to the CAIR SO2 trading 
program), compliance by EGU sources with an EPA-approved CAIR SIP or a 
CAIR FIP would satisfy the SO2 RACT requirement for the 
sources; and in States that are subject to CAIR annual NOX 
emission reduction requirements and fulfill these requirements entirely 
through EGU emission reductions (i.e. without reductions from non-EGU 
sources or allowing non-EGU sources to opt in to the CAIR annual 
NOX trading program), compliance by EGU sources with an EPA-
approved CAIR SIP or a CAIR FIP would satisfy the NOX RACT 
requirement for the sources, provided that the sources with existing 
selective catalytic reduction (SCR) emission control technology 
installed on their boilers operate that technology on a year-round 
basis beginning in 2009. One commenter supported EPA's approach so long 
as States may pursue additional reductions from EGUs if needed for 
attainment as expeditiously as practicable. A number of other 
commenters opposed the proposed determination regarding RACT for EGUs 
based on a number of issues.
    Response: Based on the rationale described in the sections above, 
the final rule includes a presumption that compliance with CAIR 
satisfies SO2 and NOX RACT/RACM requirements for 
EGUs in many areas. Nonetheless, States can require ``beyond CAIR'' EGU 
controls if a State determines that it is a necessary and reasonable 
means to attain the PM2.5 standards. Comments opposing this 
approach are addressed in more detail below.
    Comment: A number of commenters objected to the proposed 
determination, arguing that it would result in greater control 
requirements and economic burden on non-EGU sources located in 
nonattainment areas. These commenters urged EPA to adopt a final rule 
that provides for implementing the most cost-effective controls 
necessary to attain the standard. They assert that with the proposed 
finding that compliance with CAIR satisfies RACT for EGUs, the proposed 
rule would not provide for the most cost-effective approach to 
attainment. They argue EPA and States should develop cost-effectiveness 
guidance that includes all stationary source control measures and they 
should develop SIPs based on the most economic means to attain the 
standard. They make several arguments to support this position. The 
commenters asserted that if an EGU control is more cost-effective than 
a non-EGU control, the EGU should be subject to ``beyond-CAIR'' 
controls. They also asserted that if EPA chooses to consider the CAIR 
rule as satisfying SO2 and NOX RACT for EGUs, 
then other sources should not be subjected to control costs greater 
than those found reasonable under CAIR (i.e., $800/ton). They believe 
it would be inequitable to require smaller sources to pay a higher cost 
for emissions reductions than larger sources, which are a more 
significant

[[Page 20626]]

contributor to the problem and which may be able to make more cost-
effective emission reductions. One commenter also suggested that EPA 
should authorize a presumption that emissions reductions required on 
electric utilities under the CAIR will be equivalent to RACT only if a 
particular source in a CAIR State has installed controls that achieve 
the average level of control that EPA has projected will occur for the 
particular pollutant under the CAIR requirements.
    Response: The EPA has determined that implementation of the CAIR 
trading program represents highly cost-effective controls that will 
achieve widespread regional SO2 and NOX emissions 
reductions from EGUs and will provide significant air quality benefits 
for ozone and PM2.5 nonattainment areas. In developing 
attainment SIPs and identifying RACM, States will need to consider 
additional cost-effective and reasonable controls to reach attainment 
as expeditiously as practicable. The EPA does not agree with the 
commenter's argument that controls on non-EGUs should be no more than 
the projected cost of EGU controls under CAIR. The EPA expects that in 
order to achieve attainment as expeditiously as practicable, some 
States may need to adopt control measures for some sources which cost 
more per ton but which still are considered to be reasonable and cost-
effective.
    In addition, States must consider the economic feasibility of 
implementing a given control measure. Because of facility-specific 
factors, EPA believes it would be inappropriate to establish a 
threshold of control effectiveness (e.g. dollars per ton) based on 
control of EGUs and apply this threshold to all source categories. The 
ability of a source to cost-effectively reduce emissions is dependent 
on case-specific factors, including the ability of the given source to 
sustain the cost of control, and prevailing costs in the specific 
geographical location. A direct correlation between the size of an 
emissions source and the economic feasibility of controls for that 
source and location does not necessarily exist.
    We also disagree with the commenter who suggests that RACT 
requirements should only be satisfied if a source achieves an average 
level of control that EPA projects to occur under CAIR. The EPA 
maintains that the presumption that CAIR satisfies SO2 and 
NOX RACT/RACM for EGUs in most areas is an appropriate 
policy. As discussed further below, we have always recognized that 
States could determine RACT for a single source or group of sources.
    Comment: A number of commenters opposed the proposed determination 
that CAIR would satisfy the SO2 and NOX RACT 
requirement for EGUs. The commenters argued that this determination is 
unlawful, that it does not comply with section 172(c)(1) of the CAA 
which requires RACT (i.e. controls that are technologically and 
economically feasible) ``at a minimum'' for all existing sources in the 
nonattainment area, that it would allow very large stationary sources 
to escape cost-effective controls entirely, and that it is largely 
based on the legally-irrelevant contention that CAIR will reduce 
emissions more cost-effectively than RACT. They claim that EPA has no 
authority to displace the Congressionally-mandated RACT requirement, 
that CAIR was designed to address regional pollution transport (not to 
be an attainment strategy), and that EPA should remove these proposed 
provisions in the final rule. Commenters claim that the EPA's proposed 
approach to allow EGU emissions to be addressed solely through CAIR 
would undermine states' efforts to meet the Federal PM2.5 
health standard, particularly when EGU sources are among the most cost-
effective to control. Another commenter claimed that EPA's proposal 
allowing States that choose to fulfill their CAIR requirements entirely 
through emission reductions from EGUs to also use CAIR to satisfy their 
SO2 and NOX PM2.5 RACT requirements, 
thereby equating these two requirements for the EGU sector, is flawed. 
This commenter argued that allowing a cap-and-trade program, such as 
the CAIR, to substitute for the RACT requirement undermines the 
effectiveness of the controls by allowing facilities to use allowances 
to offset emissions, rather than control them at the source. The 
purchase of allowances, they assert, does not satisfy RACT 
requirements.
    Response: The EPA disagrees with these comments. The final rule 
does not displace the RACT requirement for any sources. Instead, EPA is 
exercising its authority to interpret the section 172 RACT and RACM 
requirements for the purposes of implementing the 1997 PM2.5 
standards. For the reasons described in section (b) above, we believe 
that States can rely on EPA's presumption that compliance with a CAIR 
SIP or FIP, meeting certain requirements, will satisfy the RACT/RACM 
requirement for certain EGU sources. The EPA historically issued 
control technology guidelines setting forth presumptive levels of 
emissions control that satisfy the RACT requirement for a given 
industry. The final rule is similar to this practice in establishing a 
presumption that SO2 and NOX reductions under the 
CAIR program satisfy the RACT/RACM requirement for EGUs in CAIR States. 
In identifying reasonably available control measures to ensure 
attainment as expeditiously as practicable, States will need to take 
CAIR reductions into account as well as any additional cost-effective 
reductions that are technologically and reasonably available.
    We further find that the attempt by many commenters to characterize 
CAIR as a strategy to address only regional pollution transport and not 
an attainment strategy as overly simplistic. The EPA analyses for CAIR 
show that there are significant air quality benefits projected for 
individual nonattainment areas as a result of SO2 and 
NOX reductions across the multistate CAIR region. The Act 
does not prevent States from properly crediting measures that achieve 
multiple objectives (e.g. regional transport or local nonattainment). 
Moreover, Section 110(a)(2)(D) requires SIPs to contain adequate 
provisions to assure that sources in the State do not contribute 
significantly to nonattainment in any other State. The CAIR rule is an 
integral element in meeting the States' Section 110 attainment 
obligations. Accordingly, it is reasonable to incorporate this 
consideration in determining what measures qualify as RACT/RACM.
    Finally, EPA does not interpret the provisions of Section 172(c)(1) 
related to the RACT requirement as precluding States' use of a cap and 
trade approach as a means of regulating existing sources and achieving 
RACT/RACM reductions, especially in light of Congresses' expressed 
authorization to auction emission rights in Section 172(c)(6).
    The EPA has long recognized that RACT need not apply to individual 
sources. As stated earlier, our early guidance on RACT requirements 
stated that States could establish RACT for an ``individual sources or 
a group of sources.'' (emphasis added) See Memo. Strelow (Dec. 1976) 
and 44 FR 71779. Importantly, Congress ratified the early 
interpretations of RACT and RACM when it enacted the 1990 Amendments. 
See 42 U.S.C. Section 7515 (Clean Air Act section 193). Our 1986 
emissions trading policy also recognized a number of advantages offered 
through application of a ``bubble'' approach including faster 
compliance with RACT limits and earlier reductions. Moreover, Courts 
have upheld EPA's approval of States' use of ``bubbling'' multiple 
units to meet RACT requirements. See e.g.

[[Page 20627]]

Natural Resources Defense Council v. EPA, 941 F.2d 1207 (finding that 
EPA need not adhere to a source specific RACT determination to satisfy 
RACT requirements and acknowledging EPA's special knowledge and 
expertise in the area.)
    Comment: The EPA's proposal to allow EGU emissions to be addressed 
solely through CAIR undermines prospectively States' efforts to meet 
the Federal PM2.5 health standard. EGU sources are among the 
most cost-effective to control.
    Response: For the reasons described in section (b) above, EPA 
believes that States can rely on EPA's presumption that compliance with 
a CAIR SIP or FIP, meeting certain requirements, satisfies the 
SO2 and NOX RACT/RACM requirement for certain EGU 
sources. Areas can require ``beyond CAIR'' EGU controls if a State 
determines that it is a necessary and reasonable means to attain as 
expeditiously as practicable. Nonetheless, as discussed above, EPA 
believes that implementation of the CAIR requirements will provide for 
substantial progress in attaining the PM2.5 standards and 
that States may presume that RACT/RACM requirements are equal to the 
CAIR level of control.
    Comment: CAIR fails to address the need for short-term reductions 
in PM2.5 and precursor emissions on high pollution days. 
While RACT restricts emissions over a 1-hour to 24-hour period, CAIR 
only provides for an annual or seasonal cap. Reliance on CAIR therefore 
fails to recognize the importance of reducing short-term emissions, 
which was recently highlighted by the EPA's own proposal to tighten the 
24-hour PM2.5 health standard. Local and short-term adverse 
air quality effects of PM2.5, must be addressed in the final 
rule by requiring RACT for all major facilities in addition to CAIR.
    Response: The CAIR program is oriented toward reducing 
SO2 and NOX emissions in order to reduce air 
quality concentrations on an annual and seasonal basis. Because all 
PM2.5 nonattainment areas were designated due to violations 
of the annual standard (and the two designated areas in California also 
violated the 24-hour standard), the focus of this implementation rule 
is attainment of the annual standard. CAIR is projected to provide 
significant air quality benefits in 2010 and 2015 for eastern 
PM2.5 nonattainment areas on both an annual basis and on a 
98th percentile 24-hour basis.\41\
---------------------------------------------------------------------------

    \41\ See the regulatory impact analysis chapter on air quality 
for the 2006 PM NAAQS review at http://www.epa.gov/ttn/ecas/regdata/RIAs/Chapter%204-Air%20Quality.pdf.
---------------------------------------------------------------------------

    Comment: The proposal is silent on the issue of whether EGUs are 
subject to direct PM2.5 emissions RACT requirements. It is 
critical that RACT be required for all facilities with respect direct 
PM2.5 emissions, regardless of a facility's participation in 
CAIR.
    Response: In the final rule and preamble, EPA has clarified that 
all EGUs in nonattainment areas are subject to RACT/RACM for direct 
PM2.5 emissions. The presumption described above applies 
only to SO2 and NOX RACT/RACM, not RACT/RACM for 
direct PM2.5 emissions from EGUs.
    Comment: The EPA fails to consider the geographical distributional 
impacts of the emission reductions. Equating CAIR with RACT fails to 
take into account the substantial contribution that emissions from EGUs 
within a nonattainment area may make toward that area's 
PM2.5 nonattainment problem. The EPA does not attempt to 
explain how such a generalized determination satisfies RACT for 
PM2.5.
    Response: The establishment of recommended levels for RACT/RACM is 
an area Congress delegated to the specific expertise of the Agency. 
Based on our analysis, we conclude that the CAIR emissions caps 
presumptively represent the level of emissions control achievable 
through application of ``reasonably available'' control technologies. 
Nonetheless, in developing attainment plans, each State will evaluate 
the impact of stationary sources located within the nonattainment area 
in developing its attainment strategies for the local area.
    Comment: A few commenters stated that EPA should explain how this 
proposal would be implemented for States that request an extension of 
an attainment date because attaining in 5 years or less is 
impracticable; i.e., whether EPA would still hold to its interpretation 
that CAIR equals RACT for EGUs and not require additional reductions 
from EGUs even if an area cannot attain in 5 years and controls on EGUs 
could lead it to attain more expeditiously. These commenters argue 
that, in considering if additional RACT is needed in states that obtain 
extensions of the attainment deadline after 2010, EPA cannot ignore 
potential RACT for electric generating units any more than they would 
be allowed legally to avoid consideration of any other RACT candidates. 
One commenter is particularly concerned that States would not include 
EGUs in their RACT determinations and instead require smaller 
industrial boilers or process heaters to control emissions.
    Response: The EPA's determination regarding CAIR and RACT is not 
limited to areas attaining within five years. The Agency's rationale is 
presented in the ``final rule'' section above. We disagree that the 
CAIR-RACT presumptions necessarily shift emission control burdens from 
EGUs to smaller industry boilers and process heaters because, in 
implementing the RACM requirement, the State may include an evaluation 
of control options on those sources as part of their RACT/RACM 
analyses. As stated above, EPA concluded that the CAIR compliance dates 
represent an aggressive schedule that reflects the limitations of the 
labor pool, and equipment/vendor availability, and need for electrical 
generation reliability for installation of emission controls. 
Accordingly, additional controls on EGUs may not be a reasonably 
available control measure that can be effectively implemented in a 
manner that advances an area's attainment date.
    Comment: The EPA designated many partial counties nonattainment for 
PM2.5 solely because the areas contained EGU emission 
sources thought to cause or contribute to violations of the NAAQS. In 
implementing attainment plans, it makes sense to consider further 
control of these sources, and because they are located in nonattainment 
areas, the ability to do so is provided for and legal under the CAA.
    Response: The EPA designated PM2.5 nonattainment 
counties because they either had a violating monitor or they 
contributed to a nearby air quality problem. Importantly, EPA 
designated these areas without considering the air quality benefits 
expected in the future from CAIR. Accordingly, the fact that an EGU is 
located in a partial county and we included the partial county in the 
nonattainment area because we believe that the EGU was causing or 
contributing to the nonattainment violations, does not equate with a 
finding that more than CAIR is required to remedy the nonattainment 
problem. Nonetheless, EPA believes that States should evaluate the 
impact of stationary sources in all designated counties, including 
those partial counties noted by the commenter, in its assessment of 
reasonably available control strategies to ensure attainment as 
expeditiously as practicable.
    Comment: The EPA should adopt the Ozone Transport Commission's 
(OTC's) approach to cap-and-trade programs. When the OTC developed its 
NOX

[[Page 20628]]

Budget Program (which was the basis for EPA's NOX SIP call 
and subsequently CAIR), it assumed that RACT was applied first. Thus 
the cap-and-trade program operated in an environment that assumed RACT 
was in force, not in lieu of RACT.
    Response: Under the ozone national ambient air quality standards, 
NOX and VOC RACT have been implemented progressively for the 
past 30 years or more, prior to development of the NOX SIP 
call regional control program. In contrast, the PM2.5 
implementation program is the first instance in which we have required 
RACT/RACM specifically for fine particle pollution. For this reason, 
the CAIR program is not operating with SO2 and 
NOX RACT limits already in place for attainment of the 
PM2.5 standards. Nonetheless, as discussed above, EPA 
believes that implementation of the CAIR requirements will provide for 
substantial progress in attaining the PM2.5 standards and 
that States may presume that RACT/RACM requirements are equal to the 
CAIR level of control.
    Comment: A few commenters stated that EPA should clarify and modify 
the part of its proposal that explains why a State cannot rely on EPA's 
determination that CAIR can satisfy the NOX RACT requirement 
for PM2.5 if the State ``elect[s] to allow non-EGU sources 
to voluntarily enter the EPA-administered CAIR trading program through 
an opt-in provision in the CAIR model rule.'' (70 FR 66025 col. 3). 
These commenters believe that this part of the proposal might be 
construed to preclude States subject to both the NOX SIP 
Call and included in the CAIR region for ozone from relying on the 
NOX RACT determination for PM2.5 if the States 
choose ``to bring their non-CAIR [including non-EGU] NOX SIP 
Call trading sources into the CAIR ozone season NOX cap and 
trade program.'' (70 FR 49708, 49728 col. 3) (August 24, 2005). The 
commenters assert that EPA gave States the option of bringing non-EGU 
NOX SIP Call sources into the CAIR seasonal NOX 
trading program to ensure that non-CAIR sources, including non-EGUs, 
that are subject to the NOX SIP Call rule would not be 
``stranded,'' starting in 2009, by being left in an ozone season 
NOX control program with no EGU trading partners. The 
commenters argued that ``EGUs should not be penalized, in the form of 
denial of CAIR-RACT treatment, as a result of States exercising their 
option to avoid financial and compliance difficulties for non-EGUs that 
otherwise would be left without allowance trading partners in the EGU 
sector after the NOX SIP Call trading program ends in 
2008.'' These commenters point to EPA's determination in the final 
Phase 2 ozone implementation rule, that participation in the CAIR 
trading programs can satisfy NOX RACT for ozone even if a 
State brings non-EGUs in the NOX SIP Call trading program 
into the trading program after 2008, see 70 FR 71657 col. 2, provided 
the State retains an ``EGU [emission] budget under CAIR that is at 
least as restrictive as the EGU budget that was set in the State's 
NOX SIP call SIP,'' id. At 71658 col. 1. These commenters 
argue that EPA should make a similar determination here regarding 
NOX RACT for purposes of PM2.5 NAAQS 
implementation.
    Response: All states with EPA approved CAIR SIPs or subject to a 
CAIR FIP implementing the annual NOX emission reduction 
requirements, and obtaining those reductions solely from EGUs may rely 
on EPA's determination that CAIR presumptively satisfies NOX 
RACT/RACM for PM2.5 for these sources. This determination is 
unaffected by whether or not a State permits NOX SIP Call 
non-EGUs to participate in the CAIR ozone season trading program. In 
the final rule, we have included the presumption that NOX 
RACT/RACM for PM2.5 is satisfied for EGUs complying with a 
CAIR SIP or CAIR FIP implementing the annual CAIR NOX 
emission reduction requirements (provided the State implementation of 
the CAIR NOX annual trading program includes EGUs only).\42\
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    \42\ EPA's CAIR-RACT presumption also would not apply if a State 
required sources other than EGUs to achieve a portion of the 
reductions required by CAIR (e.g., the State's CAIR SIP achieved 
some reductions from EGUs but took credit for non-EGU reductions 
achieved under new, more stringent requirements implemented to meet 
NOX SIP call caps). Under the CAIR rule such a State 
would not be eligible to participate in the EPA-administered CAIR 
trading system.
---------------------------------------------------------------------------

    In the final ozone implementation rule, EPA addressed numerous 
issues relating to the transition from the NOX SIP Call to 
the CAIR ozone season trading program, including the impact of bringing 
NOX SIP Call non-EGUs into the CAIR ozone season trading 
program. Commenters' suggestion that these determinations are relevant 
to this PM2.5 implementation rule ignores the fact that both 
the NOX SIP Call and the CAIR ozone season trading program 
are seasonal, not annual, trading programs. The NOX SIP Call 
EGU and non-EGU budgets are seasonal NOX budgets and do not 
address annual NOX emissions. As discussed above, 
PM2.5 levels year-round contribute to an area's annual 
average concentration, and NOX emissions during non-summer 
months contribute to nitrate concentrations, which are typically 
highest in cooler temperatures. For these reasons, EPA believes it 
would be inappropriate to accept commenters' suggestion.
8. What Are the Required Dates for Submission and Implementation of 
RACT?
a. Background
    The EPA requested comment on a general approach for the dates for 
submission and implementation of RACT rules. The final rule retains the 
proposed approach, as described in the following section.
b. Final Rule
    The final rule requires the following:
    (1) Date of submission. States must submit adopted RACT rules to 
EPA within 3 years of designation, at the same time as the attainment 
demonstration due in April 2008.
    (2) Dates for implementation of control measures. States should 
also implement any measures determined to be RACT expeditiously, as 
required by section 172. Implementation of RACT measures should in no 
case start later than the beginning of the year before the nominal 
attainment date. For example, if an area has an attainment date of 
April 2010, then any required RACT measures should be in place and 
operating no later than the beginning of 2009. This is intended to help 
provide for clean air in calendar year 2009. As discussed in section 
II.D, if other criteria are also met, EPA could then grant the area a 
1-year attainment date extension if the air quality level in the 3rd of 
the 3 years was below the level of the standard. If the area observes a 
second year of clean air, EPA could grant a second 1-year attainment 
date extension. In this case, the 2009 to 2011 period would then be 
reviewed to assess whether the area attains the standards.
    (3) Provisions for a demonstration that additional time is needed. 
While EPA expects that States will implement required RACT controls by 
January 2009 in most situations, there may be cases where additional 
time is needed to implement an innovative control measure or to achieve 
a greater level of reduction through a phased approach. If a State has 
provided an adequate demonstration showing that an attainment date 
extension would be appropriate for an area, then the State may consider 
phasing-in certain RACT controls after January 2009. The EPA would 
allow the implementation of selected RACT controls after January 2009 
if the State can show why additional time is needed for

[[Page 20629]]

implementation, and such delayed implementation still would need to be 
on a schedule that provides for expeditious attainment. In no event 
could the State wait to implement RACT controls until the last few 
years prior to the attainment date without an adequate rationale for 
why earlier implementation was not feasible.
c. Comments and Responses
    Comment: One commenter supported EPA's position that implementation 
of RACT and RACM by January 1, 2009 is necessary to achieve the effect 
on air quality for calendar year 2009.
    Response: The EPA agrees with this comment.
    Comment: Some commenters supported allowing for an implementation 
schedule that allowed for implementation of RACT and RACM for a time 
frame extending beyond 2009. These commenters favored such an approach 
if States provided an adequate demonstration of why the measures cannot 
be implemented earlier. Commenters noted that a phased approach to 
emissions reductions in some cases could lead to additional reductions 
that could not occur by 2009.
    Response: The EPA agrees with these comments.
    Comment: One commenter believed that so long as a State 
demonstrates attainment by 2015, EPA should not require implementation 
of any RACT measures. The commenter further asserted that it would be 
bad policy to require costly emissions reductions through imposition of 
RACT on areas expected to attain the standards through other means by 
2015.
    Response: The EPA disagrees with this comment. The CAA requires 
States to demonstrate that the attainment plan will attain the 
standards as expeditiously as practicable and must include RACT and 
RACM. The requirement for ``reasonable'' measures does not require that 
any theoretical measure be implemented, but does require implementation 
of those reasonable measures which could advance the attainment date by 
at least 1 year. Given the health effects associated with 
PM2.5, EPA believes this approach is sound public policy.
9. Which Pollutants Must Be Addressed by States in Establishing RACT 
and RACM Limits in Their PM2.5 Attainment Plans?
a. Background
    In the proposed rule, and in the final rule as discussed in detail 
in section II.A above, EPA discusses the pollutants which States must 
address in the attainment plans, in particular with respect to RACT, 
RACM and NSR. These pollutants include not only direct 
PM2.5, but also gaseous precursors to the formation of 
PM2.5. In general, the decisions that States and EPA make 
with respect to which precursors are significant contributors to an 
area's PM2.5 nonattainment problem define the pollutants and 
sources to be addressed by States in developing RACT and RACM.
b. Final Rule
    In the final rule, in establishing RACT and RACM limits, those RACT 
and RACM limits must address:

--Direct emissions of PM2.5
--SO2, a precursor to PM2.5 formation, and
--NOX, unless a State makes a finding that NOX 
emissions from sources in the State do not significantly contribute to 
the PM2.5 problem in a given nonattainment area.

    The EPA generally presumes that RACT and RACM limits are not needed 
for ammonia or VOC unless that State or EPA determines otherwise for a 
given nonattainment area. RACT and RACM limits are needed for ammonia 
if a State or EPA makes a finding that ammonia emissions significantly 
contribute to the PM2.5 problem in a given nonattainment 
area, and thus finds that control of ammonia would help address the 
PM2.5 problem. RACT and RACM limits are needed for VOC only 
if a State or EPA makes a finding that VOC emissions significantly 
contribute to the PM2.5 problem in a given nonattainment 
area. (As a point of clarification, ``VOCs,'' which are gaseous organic 
precursors to the chemical formation of secondary organic aerosol, are 
treated differently from semivolatile or nonvolatile organic compounds 
which are addressed as directly emitted PM2.5). Issues 
related to the finding of ``significant contribution'' for these 
pollutants are discussed in Section II.A above.
10. Under the PM2.5 Implementation Program, When Does a 
State Need To Conduct a RACT Determination for an Applicable Source 
That Already Has a RACT, BACT, LAER, or MACT Determination in Effect?
a. Background
    For PM2.5 nonattainment areas, States are required to 
implement the RACT requirement to reduce emissions of direct 
PM2.5 and PM2.5 precursors from applicable 
sources. The EPA anticipates that for some sources located in 
PM2.5 nonattainment areas, the State would have previously 
conducted RACT determinations for VOC or NOX under the 1-
hour ozone standard, or for direct PM10 emissions under the 
PM10 standards. Some of the RACT determinations established 
under these other programs would be relatively recent while other 
determinations may be more than 10 years old. In some cases, a new RACT 
determination might reach the conclusion that the preexisting 
determination is still valid and would require the installation of 
similar control technology because the relevant pollutant was 
addressed, the same emission points were reviewed, and the same 
fundamental control techniques would still have similar costs. In other 
cases, however, a new RACT analysis could determine, for example, that 
better technology has become available, and that cost-effective 
emission reductions are achievable.
    In the proposed rule, the EPA requested comments on a general 
approach to taking prior RACT determinations into account, and within 
the general approach, invited comments on two specific questions: (1) 
Should new RACT determinations be required for all existing 
determinations that are older than a specified amount of time (such as 
10 years old)?; and (2) what supporting information should a State be 
required to submit as part of its certification to demonstrate that a 
previous RACT analysis meets the RACT requirement currently for 
purposes of the PM2.5 program?
    In the proposed rule, EPA also noted that sources subject to RACT 
may also have been subject to other prior technology determinations 
such as BACT, LAER or MACT determinations. The proposed rule requested 
comment on approaches to taking these prior technology determinations 
into account.
b. Final Rule
    The EPA has determined that it is appropriate to follow the 
approach in the proposed rule, which is described below. State RACT 
SIPs for PM2.5 must assure that RACT is met, either through 
a new RACT determination or a certification that previously required 
RACT controls represent RACT for PM2.5.
    Where a State adopted and EPA approved a control measure as RACT 
for a pollutant emitted from a specific stationary source or source 
category under another NAAQS program, the State may submit as part of 
its SIP revision a certification, with appropriate supporting 
information, that the previous determination represents a current RACT 
level of control for those emissions for purposes of the 
PM2.5 program. Otherwise, the State should revise the SIP to 
reflect a modified

[[Page 20630]]

RACT requirement for specific sources or source categories.
    In cases where the State's prior RACT analysis under another NAAQS 
program concluded that no additional controls were necessary, a new 
RACT determination is required for that source. In cases where the 
previous RACT determination did not require any controls on the source, 
it is more likely that a new review might find that emission controls 
are now economically and technically feasible. This is because 
emissions reductions from a potential control measure are likely to be 
greater, and the cost per ton of emission reduction is likely to be 
lower, than in the case of a source that previously installed controls 
to meet RACT under another program.
    A RACT determination for a source or source category subject to a 
prior RACT determination is also required for any pollutants that were 
not the subject of the prior RACT determination, but which the State 
has determined should be regulated for purposes of PM2.5. 
The EPA advises that the State should closely review any existing RACT 
determinations established under another NAAQS program. For RACT 
certifications and determinations, States are to consider new 
information that has become available since the earlier RACT 
determination. For example, where updated information on control 
technologies is presented as part of notice-and-comment rulemaking, 
including a RACT SIP submittal for sources previously controlled, 
States (and EPA) must consider the additional information as part of 
that rulemaking. Existing EPA guidance on control technologies can be 
used to help inform RACT decisions. However, EPA believes it may not be 
sufficient for a State to rely on technology guidance that is several 
years old and issued to provide recommendations on control measures and 
levels for a different NAAQS in evaluating RACT for PM2.5.
    With respect to prior technology determinations other than RACT, 
the final rule provides that:
    (1) Prior BACT and LAER Determinations. In many cases, but not all, 
best available retrofit technology (BACT) or lowest achievable emission 
rate (LAER) provisions for new sources would assure at least RACT level 
controls on such sources. The BACT/LAER analyses do not automatically 
ensure compliance with RACT since the regulated pollutant or source 
applicability may differ and the analyses may be conducted many years 
apart. States may, however, rely on information gathered from prior 
BACT or LAER analyses for the purposes of showing that a source has met 
RACT to the extent the information remains valid. We believe that the 
same logic holds true for emissions standards for municipal waste 
incinerators under CAA section 111(d) and NSR/PSD settlement 
agreements. Where the State is relying on these standards to represent 
a RACT level of control, the State should present its analysis with its 
determination during the SIP adoption process.
    (2) Compliance With MACT Standards Affecting VOC. In situations 
where the State has determined VOC to be a significant contributor to 
PM2.5 formation in an area, compliance with MACT standards 
may be considered in VOC RACT determinations. For VOC sources subject 
to MACT standards, States may streamline their RACT analysis by 
including a discussion of the MACT controls and relevant factors such 
as whether VOCs are well controlled under the relevant MACT air toxics 
standard, which units at the facility have MACT controls, and whether 
any major new developments in technologies or costs have occurred 
subsequent to establishment of the MACT standards. We believe that 
there are many VOC sources that are well controlled (e.g., through add-
on controls or through substitution of non-VOC non-HAP materials for 
VOC HAP materials) because they are regulated by the MACT standards, 
which EPA developed under CAA section 112. Any source subject to MACT 
standards must meet a level that is as stringent as the best-controlled 
12 percent of sources in the industry. Examples of these HAP sources 
that may effectively control VOC emissions include organic chemical 
plants subject to the hazardous organic NESHAP (HON), pharmaceutical 
production facilities, and petroleum refineries.\43\ We believe that, 
in many cases, it will be unlikely that States will identify VOC 
emission controls more stringent than the MACT standards that are not 
prohibitively expensive and are thus unreasonable. We noted our view 
that this will allow States, in many cases, to conclude that the 
control measures implemented to meet MACT standards satisfy any 
requirement for VOC RACT.
---------------------------------------------------------------------------

    \43\ There are some MACT categories for which it may not be 
possible to determine the degree of VOC reductions from the MACT 
standard without additional analysis; for example, the miscellaneous 
metal parts and products (40 CFR part 60, subpart MMMM) due to the 
uncertainty of the compliance method that will be selected.
---------------------------------------------------------------------------

    (3) Compliance With MACT Standards Affecting PM2.5 
Emissions. Compliance with MACT standards may be considered in direct 
PM2.5 RACT determinations. For direct PM2.5 
sources subject to MACT standards, States may streamline their RACT 
analysis by including a discussion of the MACT controls and relevant 
factors such as whether PM2.5 emissions are well controlled 
under the relevant MACT air toxics standard, which units at the 
facility have MACT controls, and whether any major new developments in 
technologies or costs have occurred subsequent to the MACT standards. 
We believe that there are many direct PM2.5 sources that are 
well controlled (e.g., through add-on controls that represent state-of-
the-art measures for PM2.5 reduction) because they are 
regulated by the MACT standards which EPA developed under CAA section 
112. For some MACT standards, PM2.5 is used as a surrogate 
for achieving MACT for HAPs such as heavy metals. Any source subject to 
MACT standards must meet a level that is as stringent as the best-
controlled 12 percent of sources in the industry. We believe that there 
will be sources for which it will be unlikely that States will identify 
emission controls more stringent than the MACT standards that are not 
prohibitively expensive and are thus unreasonable. In addressing 
whether a MACT standard represents best controls for PM2.5, 
it is important that the State consider all PM2.5 sources at 
a given facility and the nature of the PM limit (i.e., whether the 
limit ensures control of the fine fraction of particulate matter). 
Also, the State should evaluate the degree of capture of 
PM2.5--that is, the amount of PM2.5 that is 
collected and sent to a pollution control device in addition to the 
efficiency of the device itself. This evaluation should consider the 
PM2.5 emissions reductions that could be achieved by 
improving the degree of capture.
    (4) Year-Round Controls for NOX. In some cases, sources 
subject to NOX RACT for PM will also be subject to controls 
under the NOX SIP Call. In the 8-hour ozone implementation 
rule, EPA concluded that certain sources which have installed emission 
controls to comply with the NOX SIP call would be deemed to 
meet NOX RACT for the purposes of the 8-hour ozone 
implementation program. Some of these sources subject to the 
NOX SIP call may choose to control NOX emissions 
only or primarily during the ozone season. For purposes of 
PM2.5, however, EPA concludes that the operation of emission 
controls only or primarily during the ozone season would not constitute 
RACT for PM2.5 purposes. Indeed PM2.5 control 
programs must address annual average concentrations, and in many

[[Page 20631]]

areas nitrate concentrations are generally highest in the winter. 
Therefore, RACT for PM2.5 is year-round operation of 
controls. For sources subject to both the NOX SIP call and 
NOX RACT for PM, we believe that, in most cases, the 
additional costs of running the NOX SIP call controls year-
round would impose only modest, reasonable additional costs and the 
cost effectiveness would be better than the average cost effectiveness 
for many other sources subject to PM RACT. (See further discussion in 
section F.7 above related to EGU sources subject to CAIR requirements 
for NOX).
c. Comments and Responses
    Comments: A number of commenters agreed with the requirement for 
the State to conduct a new RACT determination for any source for which 
the State's prior RACT analysis under another NAAQS program concluded 
that RACT was defined as no additional controls. One commenter noted 
that for a source having a previous RACT determination for ozone or 
PM10 to show that its level of control currently meets RACT 
for PM2.5 purposes, the source must provide supporting 
documentation showing that the previous RACT determination was based on 
the same universe of controls that are ``reasonably available'' for the 
source in the present day.
    Response: The EPA agrees with these comments.
    Comments: A few commenters recommended that EPA clarify that RACT 
determinations resulting only in ``operational changes'' should be 
treated in an equivalent manner as those resulting in no controls. The 
commenters suggested that, unlike ``physical modification,'' such 
operational changes should always be revisited with a new RACT 
determination.
    Response: The EPA does not agree with the implicit recommendation 
to impose different RACT review requirements based on the types of 
control previously implemented. The EPA believes that a reassessment of 
RACT is warranted, irrespective of the type of control previously 
implemented, to consider the reasonableness of modifying or adding 
controls in the particular circumstances. Furthermore, we are concerned 
that making such a distinction based upon the fairly broad term 
``operational change'' would be difficult to interpret and implement, 
and would invite unnecessary disputes concerning the application of the 
term.
    Comment: Commenters differed on whether new RACT determinations 
should be required for all existing determinations made before a 
specific date, and on what that date should be. Some commenters 
recommended that EPA allow States to rely on any previous RACT 
determinations made after 1990, and one commenter recommended that EPA 
require States to review only those older than 10-15 years, another 
recommended 10 years. One commenter believed that a 15-year period 
would be reasonable where previous controls were installed, to allow 
for a 15-year amortization of the cost of those controls. Other 
commenters recommended that new RACT determinations be made for any 
RACT determinations older than 5 years. Another commenter recommended 
that all RACT determinations should be reviewed.
    Response: The EPA has not included any specific time frame in the 
final rule. The EPA agrees that the more recent the RACT determination, 
the greater the probability that technology advances or decreases in 
control cost will not have occurred. At the same time, technology 
advances and decreases in control cost can and have occurred 
frequently. Accordingly, we believe it is necessary for States to 
review whether such technology advances or decreases in control cost 
have occurred before relying on previous RACT determinations. We do not 
believe there is any specific date or age that could be identified 
after which States could ensure that no technology advances or 
decreases in control cost will have occurred.
    Comment: A number of commenters expressed concerns with the 
resources required to conduct the certifications required by the 
proposed approach, and argued that expending the resources required to 
review and to certify previous RACT determinations would not be 
productive. One commenter recommended that EPA provide guidance on the 
previous RACT categories for which old RACT determinations are believed 
to be out of date. Another commenter asserted that the only possible 
exception to the acceptability of previous RACT measures for purposes 
of the ozone standards would be when the new RACT is year-round for an 
existing ozone-season RACT measure.
    Response: The EPA believes that the proposed certification approach 
strikes an appropriate balance in requiring States to verify whether 
previous RACT determinations currently represent an appropriate RACT 
level of control for PM2.5 purposes, while stopping short of 
requiring an exhaustive re-analysis for all RACT sources. The EPA 
believes that much of the resource concerns expressed in comments were 
based upon concerns that VOC sources are very numerous, and that this 
approach would require detailed review for these sources. As noted 
previously, a RACT analysis for VOC sources is required only if a State 
makes a finding that VOC sources significantly contribute to 
nonattainment in the State. We believe the commenters likely 
overestimate the resource implications of the certification process for 
prior RACT determinations. Another mitigating factor is that many of 
these same sources would be reviewed for purposes of implementing the 
eight-hour ozone standard. On the other hand, where a State or EPA 
determines that it is appropriate to regulate VOC sources for 
PM2.5, EPA believes that it likely would be productive to 
review the previous determination for such sources, some of which have 
not been reviewed for many years.
    Comment: One commenter believed that EPA should acknowledge 
detailed RACT and RACM analyses for the South Coast and San Joaquin 
Valley in California prepared during the 1990s for purposes of 
implementing the ozone and PM10 standards. The commenter 
believes that EPA acceptance of these determinations as RACT for 
PM2.5 would enable States to focus resources on developing 
new measures needed for attainment.
    Response: The EPA agrees that States should focus resources on new 
technologies and new developments. At the same time, EPA recognizes 
that for most source categories, new technology continues to be 
developed, and new information continues to be generated. Thus, even 
recent RACT determinations for a given source category may be outdated. 
Hence, the certification approach in the rule for the relevant sources 
or source categories is a reasonable approach which is designed to 
provide for the type of focused efforts suggested by the commenter.
    Comment: One commenter believed that a State certification should 
only have to identify the existing RACT levels in a SIP and pollutants 
affected, but the State should not be required to provide any 
additional information.
    Response: The EPA disagrees with this comment. The EPA believes 
that prior technology determinations should be taken into account in 
the RACT determination process. In reviewing existing RACT 
determinations, the State should provide supporting information to show 
that the existing technology in use should still be considered RACT, or 
it should show that there have been technology advances or cost 
reductions that have occurred since the previous

[[Page 20632]]

RACT limits were developed that make lower emissions technically and 
economically feasible in the context of RACT and would contribute to 
advancing the attainment date by at least one year.
    Comment: Some commenters supported EPA's requirement for year-round 
operation of NOX pollution control devices as RACT, given 
that PM2.5 is an annual standard, while ozone is a 
summertime problem.
    Response: The EPA agrees with these comments.
    Comment: One commenter concluded that BACT and LAER determinations 
should be considered to satisfy RACT, regardless of the date they were 
made, because BACT and LAER by definition are more stringent than RACT.
    Response: The EPA disagrees with this comment. The EPA believes 
that in many cases, but not all, BACT and LAER would assure RACT level 
of controls. Reasons that BACT and LAER might not satisfy RACT include: 
The pollutant of concern could have been different, the applicability 
threshold for BACT and LAER may have excluded smaller sources 
potentially subject to RACT controls, and technology advances or 
reductions in control costs may have occurred since the old 
determination was conducted.
    Comment: One commenter recommended that EPA allow States to use 
information gathered from prior BACT or LAER analyses to complete the 
RACT determination, as was allowed in the 8-hour ozone NAAQS 
implementation rule.
    Response: The final rule allows for use of such information, to the 
extent it remains valid, to inform a certification by the State that 
BACT or LAER technology continues to exceed what would currently be 
considered RACT.
    Comment: Some commenters argued that any MACT determination that 
controls the pollutants of concern should be more than sufficient to 
satisfy RACT. Some commenters made similar recommendations regarding 
specific standards where PM limits were developed as a surrogate for 
HAPs, such as the MACT standard for integrated iron and steel mills, 
the MACT standard for iron and steel foundries, and the section 129 
standards for waste to energy facilities.
    Response: While agreeing that MACT controls are relevant, the EPA 
disagrees that all MACT determinations should be automatically 
considered to satisfy RACT. Reasons include: A MACT standard aimed at 
toxics might not ensure that the relevant PM2.5 pollutant(s) 
are well controlled, MACT applicability provisions might have excluded 
units potentially subject to RACT, and technology advances or 
reductions in control costs might have occurred since EPA conducted the 
MACT analysis. The EPA believes that the State should review whether 
technology advances have occurred including available ``beyond the MACT 
floor'' technologies that may be reasonable in the context of RACT for 
PM2.5 nonattainment, but which were not selected as MACT for 
purposes of implementing section 112. The EPA believes that RACT 
analyses should evaluate whether increased capture of PM2.5 
could be achieved, and whether an increased efficiency in controlling 
the fine fraction of particulate matter is reasonably available. The 
EPA has, however, added a specific recognition that MACT standards can 
reduce PM2.5 as well as VOC, and that PM2.5 
information gathered for MACT standards development may inform a 
State's conclusions on available technologies for direct 
PM2.5 emissions.
    Comment: One commenter expressed a concern that EPA should not 
presume that MACT represents RACT where the MACT rule allows for a 
risk-based exemption from the control technology requirement.
    Response: The EPA agrees with this comment.
11. How Should Condensable Emissions Be Treated in RACT Determinations?
a. Background
    Certain commercial or industrial activities involving high 
temperature processes (fuel combustion, metal processing, cooking 
operations, etc.) emit gaseous pollutants into the ambient air which 
rapidly condense into particle form. The constituents of these 
condensed particles include, but are not limited to, organic material, 
sulfuric acid, and metals. In general, condensable emissions are taken 
into account wherever possible in emission factors used to develop 
national emission inventories, and States are required under the 
consolidated emissions reporting rule (CERR) \44\ to report condensable 
emissions in each inventory revision. Currently, some States have 
regulations requiring sources to quantify condensable emissions and to 
implement control measures for them, and others do not. In 1990, EPA 
promulgated Method 202 in Appendix M of 40 CFR Part 51 to quantify 
condensable particulate matter emissions. In the proposed rule, EPA 
discussed and requested comment on issues related to condensable 
emissions in RACT determinations.
---------------------------------------------------------------------------

    \44\ The consolidated emissions reporting rule was published in 
the Federal Register on June 10, 2002, pages 39602-39616.
---------------------------------------------------------------------------

    In the proposed rule, we noted that EPA is in the process of 
developing detailed guidance on a new test method which quantifies and 
can be used to characterize the constituents of the PM2.5 
emissions including both the filterable and condensable portion of the 
emissions stream. We also noted that when a source implements either of 
these test methods addressing condensable emissions, the State will 
likely need to revise the source's emissions limit to account for those 
emissions that were previously unregulated. For the purposes of 
determining RACT applicability and establishing RACT emission limits, 
EPA indicated in the proposal that it intends to require the State to 
adopt the new test method once EPA issues its detailed guidance. This 
guidance would be for use by all sources within a PM2.5 
nonattainment area that are required to reduce emissions as part of the 
area's attainment strategy.
b. Final Rule
    Issues and comments related to test method and emissions limit 
issues for direct PM2.5 for RACT, including discussion of 
test methods for condensable PM2.5, are discussed in section 
II.L.3 of this preamble. The EPA recognizes that in some cases 
condensable emissions are more difficult to control than filterable 
emissions. However, condensable emissions may be assumed to be almost 
entirely in the 2.5 micrometer range and smaller, so these emissions 
are inherently more significant for PM2.5 than for prior 
particulate matter standards addressing larger particles. Therefore, 
EPA encourages States to consider the potential for reducing 
condensable emissions when evaluating potential measures for RACT.
12. What Criteria Should Be Met To Ensure Effective Regulations To 
Implement RACT and RACM?
a. Final Rule
    After the State has identified a RACT or RACM measure for a 
particular nonattainment area, it must then implement that measure 
through a legally enforceable mechanism (e.g., a State rule approved 
into the SIP). The legally enforceable mechanism must meet four 
important criteria.
    First, the baseline emissions from the source or group of sources 
and the future year projected emissions must be quantifiable so that 
the projected emissions reductions from the sources can be attributed 
to the specific

[[Page 20633]]

measures being implemented. It is important that the emissions from the 
source category in question are accurately represented in the baseline 
inventory so that emissions reductions are properly calculated. In 
particular, it is especially important to ensure that both the 
filterable and condensable components of PM2.5 are 
accurately represented in the baseline since traditional Federal and 
State test methods have not included the condensable component of 
particulate matter emissions and have not required particle sizing of 
the filterable component.
    Second, the control measures must be enforceable. This means that 
they must specify clear, unambiguous, and measurable requirements. When 
feasible, the measurable requirements for larger emitting facilities 
should include periodic source testing to establish the capability of 
such facilities to achieve the required emission level. Additionally, 
to verify the continued performance of the control measure, specific 
monitoring programs appropriate for the type of control measure 
employed and the level of emissions must be included to verify the 
continued performance of the control measure. The control measures and 
monitoring program must also have been adopted according to proper 
legal procedures.
    Third, the measures must be replicable. This means that where a 
rule contains procedures for interpreting, changing, or determining 
compliance with the rule, the procedures are sufficiently specific and 
nonsubjective so that two independent entities applying the procedures 
would obtain the same result.
    Fourth, the control measures must be accountable. This means, for 
example, that source-specific emission limits must be permanent and 
must reflect the assumptions used in the SIP demonstration. It also 
means that the SIP must establish requirements to track emission 
changes at sources and provide for corrective action if emissions 
reductions are not achieved according to the plan.
b. Comments and Responses
    There were no comments on this section. The language above is very 
similar to the language in the proposal.

G. Reasonable Further Progress (RFP)

1. Background
    Clean Air Act Section 172(c)(2) requires that plans for 
nonattainment areas ``shall require reasonable further progress,'' 
which as defined in Section 171(1) ``means such annual incremental 
reductions in emissions of the relevant air pollutant as are required 
by this part or may reasonably be required by the Administrator for the 
purpose of ensuring attainment of the applicable national ambient air 
quality standard by the applicable date.'' This section describes the 
requirements the Administrator is establishing for states to achieve 
reasonable further progress.
    In general terms, the goal of these RFP requirements is for areas 
to achieve generally linear progress toward attainment. The RFP 
requirements were included in the Clean Air Act to assure steady 
progress toward attaining air quality standards, as opposed to 
deferring implementation of all measures until the end date by which 
the standard is to be attained.
2. Requirements for Areas With Attainment Dates of 2010 or Earlier
a. Background
    In 40 CFR 51.1009(b)(1) of the proposed rule, EPA proposed that a 
State which submits an implementation plan that demonstrates that an 
area will achieve attainment by 2010 (i.e., achieves attainment level 
emissions during 2009) would not be required to submit a separate 
reasonable further progress plan for that area. In such cases, EPA 
proposed that the attainment demonstration would also be considered to 
demonstrate that the area is achieving RFP.
b. Final Rule
    In the final rule, EPA is maintaining the approach described in the 
proposed rule. An area that demonstrates attainment by 2010 will be 
considered to have satisfied the RFP requirement and need not submit 
any additional material to satisfy the RFP requirement. The EPA will 
view the attainment demonstration as also demonstrating that the area 
is making reasonable further progress toward attainment.
c. Comments and Responses
    Comment: A number of commenters supported EPA's view that a 
demonstration of attainment by 2010 would also demonstrate that the 
area is making reasonable further progress toward attainment.
    Response: The EPA appreciates the support and is adopting the 
supported approach.
    Comment: A set of commenters objects to EPA's proposal, arguing 
that EPA cannot waive RFP requirements for areas where the state 
purports to demonstrate attainment. These commenters believe that 
Subpart 4 of Part D requires milestones prior to 2009, and these 
commenters believe that even Subpart 1 requires a demonstration of 
interim progress that EPA cannot waive.
    Response: In brief, EPA is not waiving the RFP requirements for any 
area. Instead, EPA is concluding that a demonstration of attainment by 
2010 also serves to demonstrate achievement of RFP. If the state 
submittal purports to demonstrate attainment but does not adequately 
make this demonstration, then the submittal also would not demonstrate 
achievement of RFP. The nature of the RFP requirement would then depend 
on whether the remedied attainment demonstration provides for 
attainment by 2010. Finally, as discussed above, EPA believes that 
Subpart 4 requirements do not apply to PM2.5 plans. More 
detailed discussion of this comment and EPA's response are provided in 
the response to comments document.
3. Requirements for Areas With Attainment Dates Beyond 2010
a. Background
    The proposed rule required a State to submit an RFP plan along with 
its attainment demonstration and SIP due in April 2008 for any area for 
which the State demonstrates that 2011 or later is the most expeditious 
attainment date. EPA proposed that the 2008 RFP plan must provide 
adequate emission reductions by 2009 \45\ and, in some cases, by 2012. 
The plan must demonstrate that emissions will decline in a manner that 
represents generally linear progress from the 2002 baseline year to the 
attainment year.
---------------------------------------------------------------------------

    \45\ The RFP test uses inventories for the full year, e.g. the 
year of 2009 or the year of 2012. EPA does not specifically require 
that the relevant measures be implemented by the beginning of the 
year, but RFP inventories must reflect the fact that measures that 
are implemented later in the year have correspondingly less impact 
on the year's annual total emissions.
---------------------------------------------------------------------------

b. Final Rule
    The final rule requires a State to submit an RFP plan along with 
its attainment demonstration and SIP due in April 2008 for any area for 
which the State justifies an extension of the attainment date beyond 
2010. The RFP plan must provide emission reductions such that emissions 
in 2009 represent generally linear progress from the 2002 baseline year 
to the attainment year. Where the State justifies an extension of the 
attainment deadline to 2014 or 2015, the state must additionally 
provide emission reductions such that emissions in 2012 represent 
generally linear progress from the 2002 baseline year to the attainment 
year.

[[Page 20634]]

    If the State demonstrates that attainment will occur by 2010 or 
earlier, EPA will consider the attainment demonstration to demonstrate 
achievement of reasonable further progress, and the State will not be 
required to submit an additional RFP plan for the area.
c. Comments and Responses
    Comment: For areas that demonstrate attainment by 2015 without 
adopting additional measures, a commenter recommended that the 
attainment demonstration be viewed as also demonstrating that the area 
is achieving RFP. The commenter therefore recommended that the state 
not be required to submit an RFP plan for such an area.
    Response: A submittal that demonstrates attainment at the latest 
allowable date and does not address interim air quality fails to show 
that the path to attainment will yield interim incremental air quality 
improvements. States have ample opportunity to adopt measures that 
would provide interim air quality improvement long before 2015. Indeed, 
as discussed elsewhere as part of the discussion of attainment dates, a 
submittal that only addresses 2015 would also fail the attainment 
demonstration requirement, insofar as it would not be addressing 
whether attainment is as expeditious as practicable, because the 
submittal would fail to assess whether attainment could be achieved 
earlier. Therefore, irrespective of whether additional measures are 
needed to attain by 2015, the Clean Air Act mandates assessing progress 
at reasonable interim dates as well as mandating attainment.
4. Generally Linear Progress and Associated Timeline
a. Background
    The EPA proposed that states with areas needing an extension of the 
attainment deadline beyond 2010 would be required to submit a plan 
demonstrating that emissions would be sufficiently reduced by 2009 to 
achieve a generally linear incremental improvement in air quality. The 
notice of proposed rulemaking provided an example calculation for an 
area with a 2013 attainment date, i.e. an area that achieves attainment 
level emissions in 2012. (See section III.G.4.b.iv of the proposal, 70 
FR 66013.) In this example, the 2009 emissions year represents 7/10 of 
the period extending from the baseline year of 2002 to the 2012 year of 
attainment level emissions. Therefore, for this example, EPA's proposed 
requirement would be for this area to achieve emission reductions by 
2009 representing approximately 7/10 of the emission reductions needed 
to attain the standards. For states with areas needing the attainment 
deadline extended to 2014 or 2015, EPA proposed to require achievement 
of generally linear emission reductions at two RFP milestone years--the 
2009 and 2012 emission years.
    The EPA received several comments on various elements of its 
proposed approach. Several commenters objected to EPA's proposed 
requirement to achieve linear progress toward attainment, asserting 
that EPA cannot reasonably expect states to achieve a significant 
amount of progress within a short time after plan submittals are due. 
Some commenters recommended requiring a specific emission reduction 
percentage, similar to the rate of progress requirement for ozone. 
These comments are addressed below.
b. Final Rule
    The EPA is requiring States with areas needing an extension of the 
attainment deadline to submit RFP plans. These plans must demonstrate 
that generally linear reductions in emissions will occur by 2009, i.e. 
that emissions in 2009 will be reduced to the extent represented by a 
generally linear progression from 2002 base year emissions to 
attainment-level emissions. For any area that needs an extension of the 
attainment deadline to 2014 or 2015, the State's RFP plan would also 
need to demonstrate that generally linear reductions will be achieved 
in the 2012 emissions year as well.
c. Comments and Responses
    Comment: Several commenters objected to EPA's proposed requirement 
that states demonstrate linear progress toward attainment. For example, 
a commenter stated that a ``generally linear reduction process may not 
be practicable.'' A commenter stated that it ``agrees that areas should 
be able to take credit for reductions from 2002 forward, [but] EPA 
should allow for fewer reductions (as opposed to linear reductions) 
prior to 2008.''
    A commenter noted that EPA's ``proposed approach ignores several 
important realities about PM NAAQS implementation. First, * * * [n]ot 
until SIP submittal in April 2008, some 6 years after the RFP baseline 
date, will any local measures be finally adopted and approved. Under 
[the example EPA provided in its proposed rulemaking], states will be 
required to play `catch-up' by achieving 70 percent of the required 
reductions in 2009. * * * Second, the `generally linear' approach 
ignores that EPA intends for states to rely in large part on mobile 
source reductions and reductions in NOX and SO2 
from CAIR implementation to achieve attainment in many areas. These 
measures fail a `generally linear' test since most of the reductions 
they provide will not be realized until after 2009.'' This commenter 
continues that the incremental reductions in emissions required in the 
Clean Air Act need not be equal increments, that the absence of a 
specific statutorily mandated increment (such as the 3 percent per year 
requirement for ozone) allows EPA to be more flexible and to rely more 
heavily on later reductions. The commenter also argues that EPA's 
proposal is more stringent than the ozone RFP requirement, insofar as 
the ozone RFP requirement provides for averaging over 3 years. Similar 
comments were submitted by other commenters.
    Another commenter supported EPA's proposal. This commenter 
supported requiring demonstrations that areas achieve emission 
reductions that will yield incremental improvement in air quality on a 
path toward expeditious attainment.
    Response: The EPA believes that the requirement for generally 
linear reductions is reasonable because it allows States to take credit 
for early reductions achieved due to federal, State, and local 
programs. We find that it appropriately implements the RFP requirement 
in the Clean Air Act. For these reasons, EPA is finalizing the 
requirement that RFP plans for areas needing an attainment deadline 
extension show generally linear progress in reducing emissions from the 
base year through the 2009 emissions year. EPA is also requiring that 
areas needing an attainment deadline extension to 2014 or 2015 (i.e. 
attainment level emissions projected to start in 2013 or 2014) show 
generally linear progress in reducing emissions through the 2012 
emissions year.
    The commenters objecting to the requirement for generally linear 
progress appear to be assuming that only minimal emission reductions 
can be expected before 2008, so that a requirement for generally linear 
progress would require plans submitted in 2008 to compensate by 
achieving unrealistically high levels of emission reductions. The EPA 
disagrees with this assumption.
    In fact, substantial emission reductions have occurred in the past 
few years and can be expected to occur through the 2009 emissions year. 
The EPA has promulgated significant mobile source rules recently that 
will yield

[[Page 20635]]

substantial benefits in the coming years, and these benefits follow a 
series of prior rules that provide a steady progression of emission 
reductions as newer, cleaner vehicles replace older, dirtier vehicles. 
For utilities, significant NOX reductions occurred in 2004 
under the NOX SIP call, and substantial SO2 
reductions are expected to occur under the CAIR trading program prior 
to 2010 due to incentives for early reductions and the banking of 
allowances.
    The EPA has also promulgated many other regulations that will 
reduce particulate matter and particulate matter precursor emissions 
before as well as after 2009. States have also been implementing a 
variety of measures. With use of a 2002 baseline, the assessment of RFP 
allows credit for these measures. The following is a partial list of 
the measures that have been adopted and will contribute to achieving 
generally linear reductions:
     NOX SIP Call.
     Tightened emission limits for new gasoline and diesel 
vehicles.
     Numerous regulations requiring Maximum Achievable Control 
Technology, including regulations for:

--Iron and steel plants, including coke plants
--Industrial boilers
--Cement plants
--Lime plants
--Primary aluminum plants

     Numerous consent decrees for refineries.
     Numerous consent decrees for power plants.
     The Clean Air Interstate Rule for utilities.
     Retrofitted controls on diesel vehicles, and related 
programs for reducing diesel vehicle emissions.
     Closures of coke plants and other facilities (and, from a 
national perspective, replacement with cleaner new facilities).
    While different control measures require various timelines for 
implementation, EPA believes that many of the additional measures that 
states might adopt for attainment planning purposes can be implemented 
in a timely fashion for addressing RFP requirements. Thus, EPA believes 
that states can reasonably be expected to assure that the combination 
of existing measures and additional measures as necessary will provide 
for generally linear progress in reducing emissions. Furthermore, 
particularly with respect to the 2009 RFP milestone year, when EPA 
evaluates whether the emission levels in a state plan represent 
generally linear progress, EPA will consider the availability of 
measures that can be implemented by 2009.
    It is difficult to compare the stringency of this RFP requirement 
to the RFP requirement for ozone. The RFP requirement for ozone 
measures one form of progress that occurs after 3 years, and the 
requirement for PM2.5 measures a different form of progress 
that occurs after 7 years (and for some areas also after 10 years). 
That is, the ozone RFP requirement applies a fixed, universally 
applicable emission reduction percentage for one pollutant (VOC), 
whereas EPA is defining the PM2.5 RFP requirement as an 
area-specific combination of emission reductions for multiple 
pollutants, defined on the basis of each area's attainment 
demonstration.
    The EPA believes that the Clean Air Act mandates not merely 
eventual attainment by 2015 but also that states demonstrate that 
emissions are being incrementally reduced in earlier years. (As 
discussed elsewhere, states must also demonstrate attainment by earlier 
than 2015 if feasible.) The requirement for RFP reflects Congressional 
intent that areas make steady progress toward attainment in the years 
before attainment occurs, and states have ample opportunity to assure 
that reductions occur well before 2015.
    Comment: A commenter observes that the PM2.5 
nonattainment areas in its state also violate the ozone standard. The 
commenter observes, ``[i]n setting plan requirements, U.S. EPA should 
choose options that best facilitate harmonization of fine particulate 
and ozone control programs. This includes using a fixed percentage of 
emission reductions per year for reasonable further progress (RFP). We 
recommend the ozone RFP metric of three percent annual emission 
reductions averaged over three years.'' Another commenter also supports 
a more prescriptive RFP requirement, and comments that ``As suggested 
by EPA, nonattainment areas must be required to achieve `a fixed 
percentage reduction of the emissions of direct PM2.5 and 
regulated PM2.5 precursors and in specific milestone years' 
between the base year and the attainment year proposed in the 
attainment demonstration.'' A third commenter supported establishing a 
requirement for a fixed emission reduction percentage, set at ``no less 
than the 3 percent rate'' in Section 182, with the possibility of 
higher rates in areas with more severe air quality problems.
    Other commenters prefer the approach that EPA proposed. For example 
one commenter states that it agrees with EPA's approach of using the 
attainment demonstration to define the parameters for determining what 
constitutes RFP, and the commenter supports the flexibility of EPA's 
proposed approach ``rather than requiring fixed linear percentage 
reductions.'' Regarding the proposed option to require 3 percent per 
year emission reductions for areas classified as serious, some 
commenters recommended against establishing classifications and a fixed 
emission reduction percentage for any area.
    Response: Requiring a fixed annual emission reduction percentage 
would impose a ``one-size-fits-all'' approach to address a range of 
circumstances. Requiring a fixed annual emission reduction percentage 
would overstate the reductions needed to achieve timely attainment in 
some areas and would understate the reductions needed to achieve timely 
attainment in other areas. The EPA believes that defining the RFP 
requirement in terms of achieving generally linear progress toward the 
emission reductions needed for timely attainment assures that each area 
will achieve a steady rate of progress most appropriate for the area to 
achieve timely attainment.
    The EPA recognizes that many areas are nonattainment for both 
PM2.5 and ozone and that the control programs for the two 
pollutants are sufficiently intertwined that harmonization of planning 
for meeting requirements applicable to the two pollutants is important. 
However, because the statutory requirements set forth in section 182 do 
not apply to PM2.5 RFP plans, EPA believes it is neither 
necessary nor appropriate to impose these requirements for 
PM2.5. Indeed, given the multiple pollutants that contribute 
to PM2.5 and the variations that exist in the nature and 
composition of PM2.5 across the country, EPA believes that 
the PM2.5 RFP requirements for generally linear reductions 
are better defined to reflect these variations and thus better targeted 
toward the emission reductions that in each area can be expected to 
lead toward timely attainment. Further, EPA believes that application 
of a different form of the RFP requirement does not cause conflicts in 
implementation planning for the two standards. For example, reductions 
of NOX emissions will generally reduce concentrations of 
both ozone and PM2.5, and NOX emission reductions 
are creditable for meeting both the ozone and the PM2.5 RFP 
requirements.
    An important distinction between PM2.5 and ozone is that 
fine particle formation is in general a more complex process, affected 
by both direct emissions and numerous precursor pollutants. The EPA 
does not believe

[[Page 20636]]

that RFP targets for PM2.5 should be the same as those used 
for the ozone implementation program, nor should the same percentage 
reduction be used for all PM2.5 related pollutants. Instead, 
EPA believes that RFP plans should reflect an appropriate combination 
of pollutant reductions that most effectively provides for attainment. 
Therefore, EPA has defined an RFP requirement in which target emission 
reductions are established in conjunction with the area's attainment 
plan.
5. Geographic Coverage of Emissions Sources
a. Background
    PM2.5 concentrations reflect a combination of impacts 
over a wide range of geographic scales. For some components of 
PM2.5, observed concentrations typically arise predominantly 
from sources within the nonattainment area. For other components, 
PM2.5 concentrations may be influenced by sources across a 
broad area extending outside the nonattainment area. The EPA's intent 
is to define the RFP requirement in terms of emissions reductions that 
can be expected to provide generally linear improvements in air quality 
in the nonattainment area. For this purpose, EPA continues to believe 
that RFP requirements for PM2.5 are best defined such that 
states evaluate emissions of each pollutant throughout the area in 
which the emissions substantially influence PM2.5 
concentrations in the nonattainment area.
    As described in the proposed rulemaking, EPA expects each area's 
attainment demonstration to identify many of the parameters used to 
define the emission reductions that would represent RFP. First, the 
attainment plan will identify the pollutants that are being reduced to 
achieve attainment. Second, the attainment plan will identify the 
amount of reduction of each pollutant and the date by which attainment 
can be achieved. This information suffices to calculate a baseline set 
of reductions to be achieved by 2009 to provide for RFP. Third, where a 
state chooses to achieve RFP by reducing some pollutants earlier than 
others, the attainment plan will provide the information needed to 
assess whether the intended set of reductions can be expected to 
provide a comparable level of air quality improvement. Fourth, if the 
State intends to include emissions sources located outside the 
nonattainment area in its RFP plan, the information necessary to 
justify inclusion of such sources will likely be found in the 
attainment plan.
    The EPA's proposed rulemaking identified several expectations 
regarding regional versus local impacts. For directly emitted 
PM2.5 (including organic and other carbonaceous particles as 
well as miscellaneous inorganic particles and including condensable 
particulate matter), EPA recognized that impacts are commonly 
localized, and that direct emissions of PM2.5 outside the 
nonattainment area should not be included in the RFP plan. Conversely, 
EPA recognized the regional nature of secondarily-formed sulfate and 
nitrate, and proposed that states could justify inclusion in the RFP 
plan of SO2 and NOX emissions sources located 
within 200 kilometers of the nonattainment area.
    The EPA recognizes that fine particles travel over long distances, 
and that distant emissions of SO2 and NOX 
emissions can influence a nonattainment area's air quality. At the same 
time, distant sources can be expected to have less impact than sources 
closer to the nonattainment area. EPA's procedures for assessing RFP 
rely on a general assumption that all the sources included in the 
assessment have a comparable impact per ton of emissions. For this 
reason, it would be inappropriate to include distant emission sources 
in the assessment. Indeed, limiting the consideration of SO2 
and NOX emissions to a 200 kilometer range is intended to 
assure that only sources with comparable impacts are included in the 
assessment.
b. Final Policy
    The policy for addressing direct PM2.5 emissions in RFP 
plans remains unchanged from the proposal: only emissions from within 
the nonattainment area may be included. Conversely, for SO2 
and NOX, EPA believes that states could be able to justify 
considering not only all emissions in the nonattainment area but also 
emissions within a distance that may be up to 200 kilometers from the 
nonattainment area. States may also be able to justify consideration of 
VOC and ammonia emissions outside the nonattainment area on a case-by-
case basis. As we explain more fully below in responding to comments, 
in situations where the state demonstrates that VOCs are a significant 
contributor to PM2.5 concentrations in the area, it may be 
appropriate to include VOC emission sources within a distance of up to 
100 kilometers of the nonattainment area. Given the uncertainties 
regarding ammonia emission inventories and the effects of reducing 
ammonia, EPA is not establishing a policy on this issue with respect to 
ammonia. States that expect to regulate ammonia should consult with 
their regional offices to determine appropriate approaches for those 
areas. The justification for considering emissions outside the 
nonattainment area shall include justification of the state's 
recommended definition of the area used in the RFP plan for each 
pollutant.
    The EPA received comments objecting to the possibility that RFP 
inventories for areas outside the nonattainment area could include 
selected sources expecting substantial emission reductions while 
excluding other nearby sources expecting emission increases. Based on 
its review of these comments, EPA is revising its approach for 
considering regional emissions. If the state justifies consideration of 
precursor emissions for an area outside the nonattainment area, EPA 
will expect state RFP assessments to reflect emissions changes from all 
sources in this area. The State cannot include only selected sources 
providing emission reductions in the analysis. The inventories for 
2002, 2009, 2012 (where applicable) and the attainment year would all 
reflect the same source domain (i.e. the same set of sources except for 
the addition of any known new sources or removal of known, creditably 
and permanently shut down sources).
    In cases where the state justifies consideration of emissions of 
specified precursors from outside the nonattainment area, the state 
must provide separate information regarding on-road mobile source 
emissions within the nonattainment area for transportation conformity 
purposes. The EPA's transportation conformity regulations (40 CFR Part 
93.102(b)) only require conformity determinations in nonattainment and 
maintenance areas, and these regulations rely on SIP on-road motor 
vehicle emission budgets that address the designated boundary of the 
nonattainment area. For this reason, if the state addresses emissions 
outside the nonattainment area for a pertinent precursor (i.e. a 
precursor for which mobile sources are significant, as discussed in the 
May 6, 2005 transportation conformity rule on PM2.5 
precursors at 72 FR 24280), the on-road mobile source component of the 
RFP inventory will not satisfy the requirements for establishing a SIP 
budget for transportation conformity purposes.
    In such a case, the state must supplement the RFP inventory with an

[[Page 20637]]

inventory of onroad mobile source emissions to be used to establish a 
motor vehicle emissions budget for transportation conformity purposes. 
This inventory must address on-road motor vehicle emissions that occur 
within the designated nonattainment area, must be provided for the same 
milestone year or years as the RFP demonstration (i.e. 2009 and 2012 as 
applicable), and must satisfy other applicable requirements of the 
transportation conformity regulations. So long as the state provides 
this separate emissions budget EPA believes that this approach will 
optimally address both the RFP and the transportation conformity 
provisions of the Act.
    The EPA is restricting the geographic area for RFP assessments to 
include only areas within the state or states represented in the 
nonattainment area. For a single state nonattainment area, only 
emissions within that state would be considered, even if other states 
may be within 200 kilometers of the nonattainment area. For multi-state 
nonattainment areas, only regions within states represented in the 
nonattainment area shall be included in the RFP assessment. This 
restriction is intended to address commenters' concerns about the 
enforceability of emission reductions included in the RFP assessment 
and helps assure accountability for these reductions. This topic is 
discussed further in the discussion below about multi-state 
nonattainment areas.
    The EPA is retaining the approach that RFP assessments may not 
include direct PM2.5 emissions from sources outside the 
nonattainment area. If a State regulates VOC or ammonia emissions as 
part of its attainment strategy, the RFP plan must include emissions of 
these pollutants. In the event that a State technical demonstration 
indicates that emissions of VOC or ammonia from sources outside the 
nonattainment area contribute significantly to PM2.5 
concentrations in the nonattainment area, EPA will consider on a case-
by-case basis whether it would be appropriate to include emissions from 
such sources in the RFP plan.
c. Comments and Responses
    The EPA received numerous comments on its proposal regarding how 
regional versus local impacts would be addressed. Multiple commenters 
objected to EPA's proposal that states could consider sources reducing 
emissions but ignore neighboring sources increasing emissions. Other 
commenters recommended that EPA support granting credit for reductions 
of direct PM2.5 emissions that occur outside nonattainment 
areas. A few commenters also recommended different treatment of 
selected pollutants.
    Comment: Several commenters object to the methods by which EPA 
proposed to account for reductions outside the nonattainment area. 
According to a set of commenters, if indeed sources outside the 
nonattainment area contribute to nonattainment, ``then EPA cannot 
lawfully or rationally allow the state to claim RFP credit from a 
single source's reductions without including in the baseline emissions 
from all sources (mobile, area and stationary) within the same distance 
from the nonattainment area, and without calculating the impacts of 
increases and decreases in such emissions on RFP. Viewing reductions 
from a single `outside the area' source in isolation will invariably 
provide an incomplete and inaccurate picture of the actual increase or 
decrease in emissions contribution to the nonattainment area from all 
`outside the area' sources. Moreover, EPA's proposal creates numerous 
opportunities to game and undermine the system. By allowing 
nonattainment areas to rely on RFP reductions made outside the 
nonattainment area, the proposed rule strays from the Act's focus on 
achieving emissions reductions from sources within the nonattainment 
area.'' Another commenter insisted that states should not be allowed to 
consider emissions from sources outside the area unless they can 
demonstrate the impacts of these sources on nonattainment area 
concentrations.
    In addition, a commenter objects to consideration only of sources 
that are reducing emissions and recommends that EPA allow credit for 
upwind source reductions only ``on the condition that all other major 
sources in the 200 kilometer boundary are also not allowed to increase 
emissions.'' Another commenter supports an option which states would 
only consider emissions within the nonattainment area, observing that 
to consider emissions outside the nonattainment area would be difficult 
to administer and might inappropriately ``dilute the reductions needed 
in the nonattainment area.'' This commenter also observes that a 200 
kilometer limit does not include much of the emissions that yield long 
range transport. Another commenter supports crediting reductions 
outside the nonattainment area but requests that EPA define the area to 
be considered.
    Response: The EPA agrees that examining emissions reductions of 
only selected sources outside the nonattainment area gives an 
inaccurate assessment of the progress that an area is making. For 
example, if a state took credit for emission reductions at Source A but 
ignored equal emission increases at neighboring Source B, the state 
would claim emission reductions in its RFP plan when in fact no net 
emission reductions had occurred.
    The commenters suggest various remedies for this problem. One 
suggestion is to include all sources within the area that is used. 
Another suggestion is to allow no consideration of emissions outside 
the nonattainment area. Yet another suggestion is to allow 
consideration of selected sources so long as other sources do not 
increase emissions.
    The EPA is adopting the first of these suggestions: for the 
pertinent area outside the nonattainment area, the RFP assessment must 
include emissions (for all years evaluated) for all sources. The EPA 
believes that inclusion of all sources is needed to ensure that the RFP 
plan reflects the actual net emissions changes that are occurring in 
the relevant area.
    In cases where the state justifies consideration of emissions of 
specified precursors from outside the nonattainment area, EPA is 
accepting the recommendation of various commenters that the inventories 
of these precursors used for RFP purposes shall include mobile source 
emissions as well as stationary and area source emissions. However, in 
cases where onroad mobile source emissions are significant and are 
therefore included, the state would need to submit additional 
information for transportation conformity purposes. As discussed above, 
in accordance with existing transportation conformity regulations (40 
CFR Part 93), the SIP's motor vehicle emissions budget(s) must reflect 
an emissions inventory of on-road mobile source emissions for the 
nonattainment area. Consequently, in these cases, the state would need 
to supplement its RFP inventory with information identifying the 
inventory of on-road mobile source emissions within the nonattainment 
area for the pertinent precursor(s) for the applicable year or years 
(i.e. 2009 and potentially 2012) to be used to establish a motor 
vehicle emissions budget for transportation conformity purposes.
    The relevant comments in general did not address the dimensions of 
spatial domain of the sources outside the nonattainment area that would 
be used in assessing RFP. EPA agrees with a commenter urging, as a 
prerequisite to including sources of the pertinent pollutants outside 
the nonattainment

[[Page 20638]]

area in the assessment, that states must justify the inclusion of 
sources outside the nonattainment area. This justification would need 
to demonstrate that these emissions have a substantial impact on 
nonattainment concentrations that warrants including these emissions 
along with nonattainment area emissions in assessing RFP. Another 
commenter recommends that EPA define the area to be included. Since the 
demonstrations of impact are best done by states, in conjunction with 
their attainment planning, EPA intends to allow States to justify the 
area to be included, within distance limits discussed above.
    Comment: Numerous commenters recommend that EPA allow credit for 
reductions of direct PM2.5 emissions outside the 
nonattainment area. Some of these commenters also recommend that EPA 
allow credit for mobile source emission reductions outside the 
nonattainment area. Other commenters support EPA's proposed approach, 
in which states may justify considering precursor emissions outside the 
nonattainment area but must evaluate direct PM2.5 emissions 
based solely on emissions within the nonattainment area.
    Response: Under Section 107 of the Clean Air Act, EPA is to 
designate nonattainment areas that include areas nearby to the 
violations that contribute to the violations. Given the spatial scale 
of the impacts of direct PM2.5 emissions, EPA believes that 
any direct PM2.5 emission source that demonstrably 
influences nonattainment area violations (and thus would contribute to 
these violations) would also be considered to be nearby to the 
violations for designation purposes. The EPA believes that it has 
properly defined the nonattainment areas to include all nearby 
contributing sources. Nevertheless, EPA asks anyone with evidence that 
an additional source or source area contributes to violations in a 
nonattainment area to submit that information to EPA and to recommend 
incorporation of that source or source area into the nonattainment 
area.
    The EPA has commented on consideration of mobile source emissions 
above. For direct PM2.5 emissions, EPA believes that the 
nonattainment area properly defines the area of consideration, and 
emissions from mobile sources outside the nonattainment area, like 
emissions from stationary sources outside the nonattainment area, 
should not be considered. For precursors for which consideration of 
emissions outside the nonattainment area is justified, the applicable 
inventories would include emissions from all sources including mobile 
sources as well as stationary sources.
    Comment: A commenter states that ``RFP credits for VOC should be 
granted for reductions achieved within the nonattainment area as well 
as [within] geographical limits outside of the nonattainment area.'' 
This commenter supports consistency with the ozone policy, which allows 
credit for NOX reductions within 200 kilometers and VOC 
reductions within 100 kilometers of the nonattainment area. Another 
commenter makes similar comments regarding VOC and comments that ``[a]s 
the science and understanding of PM2.5 formation increases, 
EPA must revisit the 200 kilometer parameter and develop a possible 
proposal for ammonia.''
    Response: Conceptually, EPA agrees that in areas where 
anthropogenic VOC emissions outside the nonattainment area are shown to 
be a significant contributor to nonattainment area PM2.5 
concentrations, presumably by formation of organic particles that 
influence nonattainment area concentrations, reduction of these VOC 
emissions could help improve air quality in the nonattainment area. 
Therefore, EPA is revising its policy to accommodate consideration of 
these potential impacts. The EPA believes that as the impacts of 
anthropogenic VOC on PM2.5 concentrations are better 
understood, it may in some cases be appropriate to consider sources 
outside the nonattainment area in RFP plans if the impacts from such 
sources can be properly quantified and justified.
    Nevertheless, EPA must highlight the technical challenges involved 
in assessing the impacts of VOC emission reductions. First, it is 
essential that the impacts of secondary organic particle formation from 
anthropogenic VOC emissions be differentiated from the impacts caused 
by biogenic VOC emissions and from the impacts of direct organic 
particle emissions. Second, the process of organic particle formation 
is highly complex, and currently available atmospheric models typically 
perform poorly in assessing the mass of particles thus formed. Third, 
the distance range of impacts, and to be more precise the distance 
range over which source impacts are comparable, is especially 
uncertain. While the distance range for organic particle formation is 
not necessarily the same as for the influence of VOC on ozone 
formation, it may be appropriate to include sources within 100 
kilometers of the nonattainment area for both purposes, as the 
commenter recommended. However, any state wishing to include such 
sources outside the nonattainment area must justify the distance range 
that is appropriate for the area.
    The EPA is not prepared at this time to establish generally 
applicable guidance with respect to how RFP plans should address 
ammonia in cases where that precursor is found to be significant. 
States that expect to regulate ammonia emissions should consult their 
regional office regarding appropriate approaches for their particular 
areas.
    Finally, EPA agrees with the commenter that EPA should revisit the 
range of issues regarding geographic distances of impacts as more 
information and understanding become available.
6. Pollutants To Be Addressed in the RFP Plan
a. Background
    A number of commenters appeared to be confused by the discussion in 
the notice of proposed rulemaking regarding the pollutants to be 
included in the RFP assessment. The EPA proposed that the attainment 
demonstration would provide the key parameters of the RFP 
demonstration, and that the list of pollutants to be addressed in the 
RFP demonstration would match the list of pollutants regulated as part 
of the attainment demonstration. However, the notice of proposed 
rulemaking also suggested that the presumptions regarding whether 
different pollutants are to be regulated under NSR and RACM (including 
RACT) would also apply to RFP. This led some commenters to recommend 
different treatment of specific pollutants.
    In fact, the presumptions of applicability that EPA is promulgating 
for RACM are not germane to RFP. The pollutant coverage of RFP 
assessments is determined on an area-specific basis according to each 
area's attainment demonstration, and EPA need not establish 
presumptions as to what pollutants are included in the RFP assessment. 
For example, if a state includes no NOX emission reductions 
in its attainment plan, then the RFP plan would not include 
NOX, irrespective of whether the (uncontrolled) 
NOX emissions contribute significantly to the areas 
PM2.5 concentrations.
    The contrast between establishment of presumptions for RACM and 
having no such presumptions for RFP (or for attainment demonstrations) 
reflects differences in regulatory context. For RACM, at issue is 
whether the impact of the pollutant is sufficient to warrant full 
implementation of the RACM requirements. In contrast, for RFP (as for 
attainment plans), EPA is establishing

[[Page 20639]]

an overall progress requirement that may be met by applying various 
control levels to various pollutants, so long as overall emission 
reductions are adequate. Indeed, if the state chooses not to control a 
particular pollutant in its attainment plan, then the presumption is 
that that pollutant would not be reduced in the RFP plan either. 
Furthermore, states have the flexibility to meet the overall progress 
with any adequate combination of control of relevant pollutants, 
regardless of the significance or insignificance of these pollutants' 
impacts. For these reasons, EPA is making no presumptions as to what 
pollutants will be included in RFP plans.
b. Final Policy
    As proposed, the pollutants to be addressed in the RFP plan are 
those pollutants that are subject to control measures in the attainment 
plan.
c. Comments and Responses
    Comment: A commenter states that ``VOC should be considered a 
presumptive PM2.5 precursor.'' Another commenter recommends 
presuming that VOC and ammonia are included in the RFP plan.
    Response: The EPA's approach to RFP does not rely on presumptions 
as to whether a pollutant does or does not warrant regulation as a 
precursor. Instead, pollutants are to be included or excluded according 
to whether the attainment demonstration includes emission controls for 
the pollutant that yield quantitative air quality benefits. Thus, 
irrespective of the presumptions applicable to RACM, the RFP plan would 
not include VOC unless the attainment plan reflects air quality 
improvements from VOC emission controls. The challenges of addressing 
VOC as part of an RFP plan were discussed earlier in this section. 
Similarly, ammonia would not be included in the RFP plan if the 
attainment plan does not regulate ammonia emissions.
7. Equivalent Air Quality Improvement
a. Background
    The EPA proposed that states could use alternative combinations of 
various types of emission control programs to meet RFP requirements if 
the alternative would be expected provide air quality improvements that 
are approximately equivalent to those of the benchmark emission 
reductions. Some control programs for some pollutants can be 
implemented more quickly than other control programs. EPA believes that 
it is unnecessary to require that all pollutants be reduced at the same 
rate or by the same fraction of the ultimate attainment plan 
reductions. The EPA believes instead that the states should have 
flexibility to ``mix and match'' control strategies, so long as they 
provide a demonstration that the adopted approach can be expected to 
yield approximately the same air quality progress as an approach in 
which the state achieves an identical fraction of the attainment 
strategy for all pollutants by the RFP milestone date.
    The notice of proposed rulemaking presented examples of the 
assessment of RFP, illustrating EPA's recommended approach for 
establishing a benchmark set of emission reductions and illustrating 
EPA's recommended procedures for whether modified approaches that 
control some pollutants earlier than other pollutants may be considered 
equivalent. While not repeated here, the examples remain appropriate 
for describing the approach included in the final rule. (See 70 FR 
66012-66013).
    Most commenters supported EPA's proposal to allow alternative 
combinations of control that can be shown by simple means to be 
equivalent. A set of commenters objected to this approach, given the 
uncertainties involved in the equivalency assessment. Nevertheless, for 
this aspect of RFP policy, EPA's final policy reflects the policy that 
it proposed.
b. Final Policy
    The EPA is adopting an approach that establishes a benchmark level 
of controls but allows states the flexibility to adopt any combination 
of controls of the various pollutants that can be shown to provide 
equivalent benefits using procedures that EPA is recommending (or at 
the State's option, air quality modeling). The first step is to 
determine the ratio of the number of years from the baseline year to 
the RFP review year (e.g., the 7 years from 2002 to 2009) divided by 
the number of years from the baseline year to the year in which 
attainment level emissions are achieved (e.g. the 10 years from 2002 to 
2012, for an area with a 2013 attainment deadline). The benchmark level 
of controls is then determined by multiplying this ratio times the 
level of control being achieved for each pollutant. For example, for an 
area with an attainment deadline extended to 2013, the benchmark level 
of controls would reflect \7/10\ of the emission reductions of each 
pollutant that is controlled in the attainment plan.
    The equivalency process involves consideration of the air quality 
benefits for the emission reductions in the alternative plan for each 
regulated pollutant. In effect, the air quality benefits for each 
pollutant are used as weighting factors, such that pollutants for which 
controls yield larger benefits are weighted more heavily in determining 
the adequacy of the resulting plan. For each pollutant, the first step 
is to find the ratio of the emission reductions achieved by the RFP 
milestone date (e.g. the emission reductions achieved between 2002 and 
2009) divided by the emission reductions achieved by the attainment 
date. The second step is to multiply this ratio times the air quality 
improvement attributable to full implementation in the attainment year 
of the attainment strategy relevant to that pollutant. The third step 
is to add these pollutant-specific results to obtain a total estimated 
air quality benefit of the alternative plan.
    The air quality benefits of the benchmark reductions are easier to 
determine. The first step, inherent to defining the benchmark 
reductions, is to determine the ratio of the number of years to the RFP 
review divided by the number of years to attainment level emissions (in 
the example above, \7/10\). The second step is simply to multiply this 
ratio times the quantity of air quality improvement achieved by the 
attainment plan. (Conceptually, the calculations are the same as are 
done for the alternative plan, but the mathematics are simpler because 
one is applying the same assumed fraction of the attainment plan 
emission reductions (e.g. \7/10\) for all pollutants, so that there is 
no need to subdivide by pollutant.) For each milestone date, any 
alternative that provides estimated air quality benefits by the RFP 
milestone date that at a minimum are generally equivalent to the 
estimated benefits of the benchmark level of emission reductions will 
be considered to satisfy RFP requirements.
c. Comments and Responses
    Comment: A set of commenters argues that the equivalency process is 
too uncertain, and recommends instead that states be required to 
achieve at least a fixed percentage reduction for all pollutants. The 
commenters cite the uncertainties acknowledged by EPA, including 
potential nonlinearity (i.e. that a given percentage of an emission 
reduction may yield a different percentage of the related air quality 
benefit). The commenters contrast EPA's willingness to accommodate 
these uncertainties, for purposes of giving states flexibility for 
alternate RFP plan designs, with EPA's unwillingness to accommodate the 
uncertainties inherent

[[Page 20640]]

in regulating ammonia emissions. The commenters state that ``Rather 
than propose a standardized process for coherently determining 
`equivalency,' EPA embraces the possibility that States will invent 
multiple and disparate methodologies.'' The commenters argue that the 
need for certainty in achieving emission reductions trumps the benefits 
of state flexibility, not the other way around. The commenters state 
that if ``EPA decides nonetheless to accept equivalency demonstrations, 
it should at least * * * require States to conduct dispersion 
modeling'' to confirm equivalency. The commenters further find unlawful 
the fact that EPA would allow ``rough equivalency'' rather than full 
equivalency to the benchmark approach. The commenters would prefer that 
EPA required a fixed percentage reduction of the emissions of direct 
PM2.5 emissions and of each precursor.
    Response: The EPA believes that its proposed approach satisfies the 
intent of the RFP requirement, which is to make ongoing, steady 
progress toward attainment rather than backloading control strategies. 
A requirement to obtain at least a given percentage of each of the 
pollutants that contribute to PM2.5 concentrations would 
impose an inflexibility that EPA concludes is unnecessary where not 
required by the statute. The EPA proposed to require that areas achieve 
emission reductions that are generally linear, and a plan that provides 
for rough equivalency to the benchmark approach would indeed provide 
generally linear reductions. In response to commenters' requests for a 
standardized process for assessing equivalency, EPA believes the 
process outlined in the final rule is responsive to this request. It is 
not clear whether the fixed reduction percentage that certain 
commenters recommended would be an area-specific percentage (such as 
EPA uses to define the benchmark approach) or a universally applicable 
percentage (such as 3 percent per year). If the former, then EPA would 
repeat the response above regarding flexibility being consistent with 
the Act's requirements; if the latter, then responses in III.6.4 
regarding a fixed reduction percentage apply. The EPA believes that the 
procedures it is establishing to assess equivalency are adequate for 
assessing RFP and that dispersion modeling need not be required for 
this purpose.
8. Other RFP Issues
a. Multi-State Nonattainment Areas
    As stated in the proposed rulemaking, EPA seeks to ensure that 
nonattainment areas that include more than one State meet RFP 
requirements as a whole. Some commenters expressed concern about how 
one state's submittal should address emissions in other states, 
including how the state might address questions about the 
enforceability of another state's requirements.
    The issues here resemble the issues for attainment demonstrations. 
In that context as well, EPA seeks plans that reflect active 
consultation by the affected states and provide a combination of 
reductions that are enforceable by the respective states that 
collectively provide for attainment. The active involvement of regional 
planning organizations helps assure a collective design of a plan with 
specific requirements to be adopted by specific states. Likewise for 
RFP, EPA would expect states with multi-state nonattainment areas to 
consult with other involved states, to formulate a list of the measures 
that they will adopt and the measures that the other state(s) will 
adopt, and then to adopt their list of measures under the assumption 
that the other state(s) will adopt their listed measures. That is, each 
state would be responsible for adopting and thereby providing for 
enforcement of its list of measures, and then that state and ultimately 
EPA (at such time as the plan is approved) would be responsible for 
assuring compliance with the SIP requirements.
    In accordance with this view of RFP, as is the case for attainment 
plans, EPA expects states sharing a multi-state nonattainment area to 
submit a common assessment of whether RFP will occur. As a default, if 
the assessment only includes emissions within the nonattainment area, 
then each state would submit an assessment based on emissions from the 
full nonattainment area including portions of the area in other states. 
If the assessment includes precursor emissions from additional area 
outside the nonattainment area, then the states should have a common 
rationale for the area included, and all affected states would use the 
same inventory of the same multi-state area thus defined in assessing 
whether RFP will occur. The EPA would judge such submittals based on 
(1) whether the overall projected emission reductions will achieve RFP 
and (2) whether the submitting state has adopted the necessary 
enforceable measures to assure that the reductions projected within its 
boundaries will in fact occur.
    As a point of clarification, even if a state justifies 
consideration of emissions outside the nonattainment area in its RFP 
assessment, EPA intends that these assessments not use emissions from 
outside the state or states represented in the nonattainment area. For 
single state nonattainment areas, only emissions within that state 
would be considered. This will help assure accountability for the 
emission reductions included in the plan.
b. Tribal Areas
    The EPA received no comments on its proposed policy regarding RFP 
for tribal areas, and EPA is finalizing the proposed policy. Under its 
Tribal Authority Rule (40 CFR 49.4), EPA found that it was not 
appropriate to apply SIP schedule requirements to tribes. For similar 
reasons, EPA is not requiring tribes to submit RFP plans. Generally 
this exemption will have limited if any impact on the achievement of 
RFP by an area. Nevertheless, consistent with its general role in 
implementing programs for tribes where ``necessary and appropriate,'' 
EPA will work with the affected tribes and states to ensure that 
emissions on tribal lands are addressed appropriately. The EPA intends 
to ensure that areas that include both state and tribal lands will 
satisfy RFP on a collective basis, similar to the policy applicable to 
multi-state nonattainment areas.
9. Mid-Course Review
a. Background
    The EPA proposed requiring mid-course reviews on a case-by-case 
basis. The proposal described a mid-course review as a combination of 
reviews aimed at assessing whether a nonattainment area is or is not 
making sufficient progress toward attainment of the PM2.5 
standards. The proposal described the mid-course review as involving 
``three basic steps: (1) Demonstrate whether the appropriate emission 
limits and emission reduction programs that were approved as part of 
the original attainment demonstration and SIP submittal were adopted 
and implemented; (2) analyze available air quality, meteorology, 
emissions and modeling data and document relevant findings; and (3) 
document conclusions regarding whether progress toward attainment is 
being made using a weight of evidence determination.'' (Cf. 70 FR 
66010)
    The EPA views mid-course review requirements as part of a set of 
requirements for implementing the Clean Air Act requirements for 
reasonable further progress. For areas that demonstrate attainment by 
April 5, 2010, EPA believes that this attainment demonstration also 
demonstrates that reasonable further progress is being achieved. For 
areas that demonstrate

[[Page 20641]]

attainment after April 5, 2010, EPA is requiring states to submit an 
RFP plan, due on April 5, 2008, showing that emissions in 2009 and, in 
some cases, in 2012, will be sufficiently reduced to provide generally 
linear progress toward levels that are expected to yield attainment. At 
issue here is how then to conduct ongoing tracking of whether the 
planned progress toward attainment is in fact occurring. Subparts 2 
(for ozone) and 4 (for PM10) include explicit requirements 
for ongoing milestone tracking. Since Subpart 1 (applicable for 
PM2.5) allows EPA flexibility in determining how ongoing 
progress is to be tracked, EPA may adopt other approaches for achieving 
the necessary assurances that ongoing progress toward attainment is 
occurring.
    Milestone reviews can be confounded by changes in inventory methods 
(a concern expressed by a commenter particularly with respect to 
condensable emissions) and involve lengthy delays while inventories are 
compiled before planning can begin. Other approaches involving only air 
quality data reviews also do not provide for timely planning, insofar 
as such approaches involve waiting for three years of air quality data 
after implementation of controls before planning can begin. The EPA 
believes that a mid-course review provides the most productive 
approach, in lieu of establishing milestone tracking or other 
requirements, to assure that reasonable further progress in reducing 
emissions is being achieved. For this reason EPA proposed a requirement 
for mid-course reviews.
    The EPA proposed a process for establishing and implementing mid-
course review. After the state submits an attainment plan (due in April 
2008), EPA would evaluate whether a mid-course review is warranted 
after considering various factors including factors identified in the 
proposal. The EPA did not propose to conduct further rulemaking on 
establishing this requirement, but EPA proposed that ``[w]here EPA 
finds that a MCR would be required, the approval of the [attainment] 
demonstration would be contingent on a commitment from the State to 
conduct the MCR.'' The mid-course review would then be due April 2010. 
The EPA's proposal also stated that ``EPA would determine [based on 
review of the mid-course review] whether additional emissions 
reductions are necessary,'' so that states would need to complete the 
mid-course review ``three or more years before the applicable 
attainment date to ensure that any additional controls that may be 
needed can be adopted [in timely fashion].'' Finally, EPA stated ``[i]f 
a mid-course review will be required for certain PM2.5 
nonattainment areas, separate PM2.5 mid-course review 
guidance will be written to address the specific requirements of 
PM2.5 nonattainment areas.''
    The EPA received numerous comments objecting to EPA's proposed 
approach. Several commenters noted the inconsistency between requiring 
a mid-course review in April 2010 versus requiring a mid-course review 
due 3 or more years before an attainment date of 2012 or earlier. 
Multiple commenters objected to EPA requiring a mid-course review only 
2 years after the initial attainment plan is due. A commenter requested 
``nationally applicable guidance on when an MCR would be required and 
what it would need to include.'' No commenters supported EPA's timeline 
for mid-course reviews.
    Based on the comments that EPA received, EPA has reevaluated the 
process for mid-course reviews. Upon reevaluation, EPA shares many of 
the concerns expressed by commenters about the proposal. The proposal 
indeed presents conflicting dates for submittal. The EPA agrees that a 
deadline just 2 years after the initial SIP submittal is too soon for 
states to conduct meaningful analyses of whether areas are making 
progress towards attainment. This problem would be exacerbated by the 
proposed process, in particular the fact that states would not know to 
begin work on a mid-course review until after they had submitted their 
initial SIP and after EPA had sufficiently reviewed the submittal to 
determine the need for a mid-course review. An early mid-course review 
also would defeat one of the purposes of the mid-course review, which 
is to take advantage of advances in the science and understanding of 
the nature of condensables and other components of PM2.5, to 
adjust plans to be better targeted at solving problems. For these 
reasons, EPA is significantly revising its approach to mid-course 
reviews as recommended by the commenters. The EPA is establishing a 
rule which provides more certainty to the states as to applicability 
and content of mid-course review requirements, thereby avoiding the 
need for future EPA rulemakings on the subject. The EPA's rule clearly 
does not require states with early attainment dates to conduct a mid-
course review and would clearly mandate a mid-course review only for 
areas with later attainment dates. The EPA's final rule clarifies the 
content of mid-course reviews and provides for states to make decisions 
on whether further controls are needed rather than having EPA make this 
determination. The mid-course review shall include an updated modeled 
attainment demonstration as well as a review of the implementation of 
measures in the April 2008 SIP and a review of recent air quality data. 
The EPA believes that all of these elements are necessary and should be 
sufficient for the state to identify whether additional measures are 
needed to achieve attainment by the attainment date in the approved 
plan. The EPA believes that states, not EPA, should make the initial 
determination as to whether additional measures are needed, and EPA has 
designed its mid-course review requirements to provide for the states 
to make this determination.
    The EPA is promulgating a fixed date of April 2011 as a date for 
submittal of mid-course reviews for areas with attainment dates in 2014 
or 2015. This fixed date will facilitate joint planning for multiple 
areas to apply common assumptions regarding regional transport. This 
date also gives states adequate notice for preparing these reviews and 
adequate time after the April 2008 submittal to incorporate new 
information and understanding of PM2.5 nonattainment 
problems to adjust attainment strategies as appropriate.
    The EPA is not requiring areas demonstrating attainment by 2013 or 
before to conduct a mid-course review. Such areas plan to have 
attainment level emissions by 2012, and EPA believes that an April 2011 
mid-course review would not provide a timely reassessment of such 
areas' attainment plans. Instead, EPA is clarifying that mid-course 
reviews are only required for areas that demonstrate a need for an 
attainment date extension at least to April 2014.
b. Final Rule
    For each area with an approved attainment date in 2014 or 2015, EPA 
is requiring the state to submit a mid-course review by April 2011. The 
mid-course review shall include an updated attainment demonstration as 
well as a review of the implementation status of measures included in 
the April 2008 submittal and a review of recent air quality data. The 
state shall determine whether additional measures are needed for timely 
attainment, just as the state is responsible for determining whether 
additional measures are needed in the April 2008 attainment 
demonstration, subject to formal EPA SIP review. The EPA is not 
requiring RFP milestone reviews, and EPA is requiring mid-course 
reviews for areas with sufficiently extended attainment dates in lieu 
of any other form of tracking reasonable progress.

[[Page 20642]]

c. Comments and Responses
    Comment: A number of commenters objected to EPA's proposed 
timeframe that would have areas submit a mid-course review only 2 years 
after the initial SIP is due. They recommended, instead, that areas 
with attainment dates 2 years or more beyond the first 5-year period 
submit mid-course reviews 3 years after the SIPs are due (April 2011) 
and every 3 years thereafter, if necessary. Their reason for this 
suggestion is that the timing of mid-course review requirements needs 
to be clearer and should allow adequate time between plans and mid-
course reviews if they are to serve as meaningful reviews.
    Several commenters also noted an inconsistency in the timing of 
mid-course review requirements under EPA's proposal. The EPA proposed 
that mid-course review submittals would be due 5 years after the 
initial designation, which for all the original designations means 5 
years after April 2005, i.e. April 2010. However, EPA also proposed 
that mid-course reviews would be due 3 years before the attainment 
date, which for areas with an April 2012 attainment date means April 
2009. The commenters considered April 2009 for a mid-course review 
submittal to be too soon after the initial SIP submittal in April 2008, 
arguing that EPA would not have had time to review the 2008 SIP 
submittal, and the states would not have time to prepare a mid-course 
review by 2009. Some of these commenters expressed a view that EPA 
should not require mid-course reviews earlier than 3 years after the 
SIP submittal date.
    Response: The EPA agrees with these comments. The EPA is remedying 
the inconsistency in submittal dates by establishing the single 
submittal due date of April 2011 that was recommended by the 
commenters. As requested by commenters, EPA is also clarifying the 
applicability of the mid-course review requirement. The requirement 
shall apply to areas with attainment dates of 2014 or 2015; mid-course 
reviews shall not be required for areas that are expected to attain the 
standards by 2013.
    Comment: A commenter supports mid-course reviews as a means of 
assuring that areas with longer-term compliance dates are on track to 
attain the NAAQS as expeditiously as practicable.
    Response: The EPA agrees that mid-course reviews can be a critical 
step in assuring expeditious attainment for areas with extended 
attainment dates. Indeed, EPA is relying on mid-course reviews rather 
than milestone reviews or other forms of RFP tracking to serve this 
purpose.
    Comment: A commenter recommended eliminating mid-course review 
requirements for any area with less than seven years between SIP 
submittal and attainment. The commenter urged that EPA carefully 
reconsider its overall timelines for PM2.5 while considering 
the feasibility and practical usefulness of the steps required of 
States and emission sources.
    Response: The EPA agrees that the proposed timeline potentially 
required mid-course reviews in areas where such reviews would not be 
warranted, and the timeline did not provide the clarity as to the 
applicability of the requirement that states need to fulfill their 
planning responsibilities. In response, EPA is not requiring mid-course 
reviews for areas demonstrating attainment prior to 2014. For those 
areas that cannot demonstrate that attainment will occur prior to 2014, 
EPA has streamlined the mid-course review process so that the state 
bears responsibility for making the initial determination as to whether 
additional measures are needed to achieve timely attainment, rather 
than requiring additional steps of EPA rulemaking and initial findings 
by EPA as to the level of controls needed in the state's SIP. With the 
revised timetable, states can be assured of a meaningful mid-course 
review effort that focuses on the areas that particularly warrant such 
a review and for which time is available for a productive assessment of 
the need for additional measures.
    Comment: One commenter stated that the proposal that allows the 
Agency to determine whether or not a State needs to submit a mid-course 
review with their attainment demonstration on a case-by-case basis 
lacks sufficient information. Since these attainment demonstrations 
must meet rigorous criteria, and require substantial work by the 
States, the commenter is concerned that the proposal neglects to 
outline the criteria EPA will use to make the case-by-case mid-course 
review determinations. The commenter asks that EPA provide the States 
with nationally applicable guidance on when an MCR would be required 
and what it would need to include.
    Response: The EPA agrees with this comment. In particular, EPA 
agrees that establishing clear criteria for applicability and content 
of a mid-course review requirement will provide states the opportunity 
to plan for these reviews and conduct appropriate reviews in a timely 
fashion. Therefore, this final rule is establishing specific criteria 
for the applicability of the mid-course review requirement, namely that 
a mid-course review shall be conducted for any area that cannot 
demonstrate attainment before 2014. This final rule is also identifying 
the necessary elements of this mid-course review, i.e. a review of the 
implementation of measures in the 2008 SIP, and review of recent air 
quality data, and an updated modeled attainment demonstration.

H. Contingency Measures

a. Background
    Under subpart 1 of the CAA, all PM2.5 nonattainment 
areas must include in their SIPs contingency measures consistent with 
section 172(c)(9). Contingency measures are additional control measures 
to be implemented in the event that an area fails to meet RFP or fails 
to attain the standards by its attainment date. These contingency 
measures must be fully adopted rules or control measures that are ready 
to be implemented quickly upon failure to meet RFP or failure of the 
area to meet the standard by its attainment date. The preamble to the 
proposal stated that the SIP should contain trigger mechanisms for the 
contingency measures, specify a schedule for implementation, and 
indicate that the measures will be implemented without significant 
further action by the State or by EPA. The contingency measures should 
consist of other control measures for the area that are not included in 
the control strategy for the SIP.
    The April 16, 1992 General Preamble provided the following 
guidance: ``States must show that their contingency measures can be 
implemented without further action on their part and with no additional 
rulemaking actions such as public hearings or legislative review. In 
general, EPA will expect all actions needed to affect full 
implementation of the measures to occur within 60 days after EPA 
notifies the State of its failure.'' (57 FR at 13512.) This could 
include Federal measures and local measures already scheduled for 
implementation, as explained below.
    The EPA has approved numerous SIPs under this interpretation--i.e., 
that use as contingency measures one or more Federal or local measures 
that are in place and provide reductions that are in excess of the 
reductions required by the attainment demonstration or RFP plan. (62 FR 
15844, April 3, 1997; 62 FR 66279, December 18, 1997; 66 FR 30811, June 
8, 2001; 66 FR 586 and 66 FR 634, January 3, 2001.) The key is that the 
statute requires that contingency measures provide for additional 
emission reductions that are not relied

[[Page 20643]]

on for RFP or attainment and that are not included in the 
demonstration. The purpose is to provide a cushion while the plan is 
being revised to meet the missed milestone. In other words, contingency 
measures are intended to achieve reductions over and beyond those 
relied on in the attainment and RFP demonstrations. Nothing in the 
statute precludes a State from implementing such measures before they 
are triggered. In fact, a recent court ruling upheld contingency 
measures that were previously required and implemented where they were 
in excess of the attainment demonstration and RFP SIP. See LEAN v. EPA, 
382 F.3d 575, 5th Circuit., 2004.
    One basis EPA recommends for determining the level of reductions 
associated with contingency measures is the amount of actual 
PM2.5 emissions reductions required by the control strategy 
for the SIP to attain the standards. The contingency measures are to be 
implemented in the event that the area does not meet RFP, or attain the 
standards by the attainment date, and should represent a portion of the 
actual emissions reductions necessary to bring about attainment in 
area. Therefore, the emissions reductions anticipated by the 
contingency measures should be equal to approximately 1 year's worth of 
emissions reductions necessary to achieve RFP for the area.
    As stated previously, EPA believes that contingency measures should 
consist of other available control measures beyond those required to 
attain the standards, and may go beyond those measures considered to be 
RACM for the area. It is important, however, that States make decisions 
concerning contingency measures in conjunction with their determination 
of RACM for the area, and that all available measures needed in order 
to demonstrate attainment of the standards must be considered first; 
all remaining measures should then be considered as candidates for 
contingency measures. It is important not to allow contingency measures 
to counteract the development of an adequate control strategy 
demonstration.
    The preamble to the proposal stated that contingency measures must 
be implemented without ``significant further action'' after EPA 
determines that the area has either failed to meet RFP, or has failed 
to attain the standard by its attainment date. The purpose of the 
contingency measure provision is to ensure that corrective measures are 
put in place automatically at the time that EPA makes its determination 
that an area has either failed to meet RFP or failed to meet the 
standard by its attainment date. The EPA is required to determine 
within 90 days after receiving a State's RFP demonstration, and within 
6 months after the attainment date for an area, whether these 
requirements have been met. The consequences for states which fail to 
attain or to meet RFP are described in section 179 of the CAA.
2. Final Rule
    The final rule includes regulatory text for contingency measures 
and maintains the overall policy approach as described in the preamble 
to the proposal. The key requirements associated with contingency 
measures are:

--Contingency measures must be fully adopted rules or control measures 
that are ready to be implemented quickly upon failure to meet RFP or 
failure of the area to meet the standard by its attainment date.
--The SIP should contain trigger mechanisms for the contingency 
measures, specify a schedule for implementation, and indicate that the 
measures will be implemented without further action by the State or by 
EPA.
--The contingency measures should consist of other control measures for 
the area that are not included in the control strategy for the SIP.
--The measures should provide for emission reductions equivalent to 
about 1 year of reductions needed for RFP, based on the overall level 
of reductions needed to demonstrate attainment divided by the number of 
years from the 2002 base year to the attainment year. Contingency 
measures are those measures that would not be included in the 
attainment strategy for various reasons; for example, they may not be 
as economically feasible as other measures that are considered to be 
RACM, or it may not be possible to implement the measures soon enough 
to advance the attainment date (e.g. federal mobile source measures 
based on the incremental turnover of the motor vehicle fleet each 
year).
3. Comments and Responses
    Comment: Several comments were received concerning the requirement 
for contingency measures under section 172(c)(9). The proposal 
indicated that contingency measures adopted as part of the State plan 
are to be equal to approximately 1 year's worth of emissions reductions 
necessary to achieve RFP, as determined by the attainment demonstration 
for the area. One commenter indicates that this amount of reductions 
for contingency measures may be excessive in some cases. The commenter 
stated that States should be allowed to demonstrate appropriate amount 
of reductions for contingency measures in each area based on the degree 
of the PM2.5 nonattainment area problem and the progression 
of emission reductions planned for the area as a part of the SIP.
    Response: The EPA agrees that the CAA does not include the specific 
level of emission reductions that must be adopted to meet the 
contingency measures requirement under section 172(c)(9). One possible 
interpretation of the CAA would assume that contingency measures should 
be in place in the event that all of the State's measures fail to 
produce their expected emission reductions. Under this scenario, the 
State theoretically would be required to adopt sufficient contingency 
measures to make up for the entire short fall. In other words, the 
State would have to adopt ``double'' the measures required to satisfy 
the applicable emissions reduction requirements.
    The EPA believes that this scenario would be highly unlikely and 
that this interpretation would be an unreasonable requirement. The 
adoption of double the measures needed for attainment would be 
difficult for States. Therefore, the EPA believes that it is reasonable 
that contingency measures should, at a minimum, ensure that an 
appropriate level of emissions reduction progress continues to be made 
if attainment or RFP is not achieved, or if an area fails to attain the 
standard by its statutory attainment date and additional planning is 
needed by the State. The EPA believes that the contingency measures 
adopted by the State for the affected area should represent a portion 
of the actual emissions reductions necessary to bring about attainment 
in the area. Therefore, EPA believes that it is reasonable to require 
states to adopt contingency measures equal to approximately 1 year's 
worth of emissions reductions necessary to achieve RFP for the area.
    Comment: One commenter claimed that EPA incorrectly quoted the CAA 
as requiring SIPs to provide for implementation of contingency measures 
upon an attainment or RFP failure, without ``significant'' further 
action by the State or EPA. The commenter stated that section 172(c)(9) 
does not contain the word ``significant.'' The CAA requires that 
contingency measures take effect ``without further action'' by the 
State or EPA.
    Response: The EPA agrees with the commenter that the general 
requirements for attainment plans specified under section 172(c)(9) 
State that each plan must contain additional measures that will take 
effect without

[[Page 20644]]

`further action' by the State or EPA if an area either fails to make 
RFP or fails to attain the standard by the applicable attainment date. 
Section 51.1012 of the final rule describes the contingency measures 
requirement and does not include the word ``significant.'' However, as 
a matter of practicality states need to take minimal steps to make 
contingency measures effective and alert the affected public that the 
measures are in force. Thus, EPA has indicated based on conclusions 
first made in the 1992 General Preamble that states should complete all 
of these administrative steps within 60 days and that all regulatory 
steps be completed before SIP submission.
    Comment: The commenter further states that EPA is wrong in 
asserting that contingency measures can include Federal measures and 
local measures already scheduled for implementation, or previously 
implemented measures that provide `excess' reductions. The CAA requires 
contingency measures to consist of controls `to be undertaken if ' the 
area fails to meet attainment or RFP. The commenter states that this 
language clearly states that such measures are to be new measures that 
will be undertaken upon the triggering event specifically to address 
RFP or failure to attain, not measures already in place, or measures 
required for other reasons.
    Further, the commenter claims that EPA can not rationally refer to 
any reductions prior to an attainment or RFP failure as `excess' when 
total reductions in the area in fact prove insufficient to meet 
attainment RFP. The commenter states that EPA cites a 5th Circuit case 
as support, but the commenter respectfully submits that the case was 
incorrectly decided on this issue for the aforementioned reasons.
    Response: In response to comments claiming that EPA is wrong in 
asserting that contingency measures can include Federal measures and 
local measures already scheduled for implementation, or previously 
implemented measures that provide `excess' reductions, as stated 
previously, the EPA has approved numerous SIPs under this 
interpretation. The statute requires that contingency measures provide 
for additional emission reductions that are not relied on for RFP or 
attainment and that are included in the attainment demonstration for 
the area. These measures are intended to provide a ``cushion'' in terms 
of emissions reductions for the area while the State is revising the 
SIP for the area due to the failure to show RFP or attain. In other 
words, contingency measures are intended to achieve reductions over and 
beyond those relied on in the attainment and RFP demonstrations. 
Nothing in the statute precludes a State from implementing such 
measures before they are triggered.
    As noted above, EPA's General Preamble interpreted the control 
measure requirements of sections 172(c)(9) and 182(c)(9) to allow 
nonattainment areas to implement their contingency measures early. 57 
FR 13498, 13511 (April 16, 1992). The EPA has applied this 
interpretation in rulemakings. See, for example, 67 FR 6,590, 6,591-92 
(September 26, 2002). See also rulemakings cited in the Background 
section, above. As set forth above, the Fifth Circuit has upheld EPA's 
interpretation. Louisiana Environmental Action Network v. EPA, 382 F.3d 
575 (Fifth Cir. 2004). (``LEAN'') Commenters have not provided a basis 
for concluding that the Fifth Circuit in the LEAN case wrongly 
interpreted the CAA.
    Commenters contend that the language in the CAA regarding 
contingency measure controls ``to be undertaken'' requires measures not 
already in place or required for other reasons. The Fifth Circuit 
disagreed, finding that the terms in section 172(c)(9)--``to be 
undertaken'' and ``to take effect''--were ambiguous, and finding 
persuasive EPA's interpretation that this language allows measures 
already in place or otherwise required. The Court held:

    ``Here, the EPA's allowance of early reductions to be used as 
contingency measures comports with a primary purpose of the CAA--the 
aim of ensuring that nonattainment areas reach NAAQS compliance in 
an efficient manner--and necessary requirements of the CAA.'' 382 
F.3d at 583.

The Court further found that ``By utilizing contingency measures early, 
the contingency measures ensured that `an appropriate level of 
emissions reduction progress' would be implemented while the State 
`adopt[ed] newly required measures resulting from the bump-up to a 
higher classification.'' [citing the General Preamble]. Id.
    In addition, the Court agreed with EPA that ``early reductions are 
necessary in order to create an incentive for nonattainment areas to 
implement `all reasonably available control measures as expeditiously 
as practicable' '' in accordance with section 172(c)(1) of the CAA. 
Thus the Court concluded that it would be ``illogical to penalize 
nonattainment areas that are taking extra steps, such as implementing 
contingency measures prior to a deadline, to comport with the CAA's 
mandate that such states achieve NAAQS compliance as `expeditiously as 
practicable.' '' Id. at 583-584.
    The Fifth Circuit also endorsed the concept of ``excess'' 
reductions, noting that the reductions credits at issue in that case, 
``although already implemented, are in effect set aside, `to be applied 
in the event that attainment is [not] achieved' and such reduction 
credits `are not available for any other use.' [citations omitted]. The 
setting aside of a continuing, surplus emissions reduction fits neatly 
within the CAA's requirement that a necessary element of a contingency 
measure is that it must `take effect without further action by the 
State or [EPA]'.'' The Court concluded that ``the early activation of 
continuing contingency measures is consistent with the purpose and 
requirements of the CAA statute.'' Id. at 584.
    Thus, EPA's approval of early implemented contingency measures is 
consistent with the CAA, as well as with EPA guidance. For example, EPA 
has consistently taken the position that ozone nonattainment areas 
classified moderate and above must include sufficient contingency 
measures so that ``upon implementation of such measures, additional 
emissions reductions of up to 3 percent of the emissions in the 
adjusted base year inventory (or such lesser percentage that will cure 
the identified failure) would be achieved in the year following the 
year in which the failure has been identified.'' 57 FR at 13511 (EPA's 
General Preamble). Thus the contingency measures are supposed to ensure 
that progress towards attainment will occur while the relevant State 
adopts whatever additional controls may be necessary to correct a 
shortfall in emissions reductions. Id. The EPA has historically allowed 
early reductions--that is, reductions achieved before the contingency 
measure is ``triggered''--to be used as contingency measures. See also 
August 13, 1993 Memorandum from G.T. Helms: Early Implementation of 
Contingency Measures for Ozone and Carbon Monoxide (CO) Nonattainment 
Areas).
    The commenter's argument that emission reductions cannot be valid 
contingency measures if they are otherwise required is also misplaced. 
A State must have the legal authority to require whatever reductions it 
may require as a contingency measure. As EPA has previously stated, 
``all contingency measures must be fully adopted rules or measures.'' 
62 FR 15844, 15846 (April 3, 1997). The fact that the State or Federal 
government has already exercised that authority is irrelevant because, 
as noted above, contingency measures must ``take effect

[[Page 20645]]

without further action by the State or [EPA].'' Section 172(c)(9). 
Thus, by definition, the State necessarily will have already exercised 
its legal authority to require reductions as a contingency measure 
before the measure is triggered. It does not matter whether or not a 
specific contingency measure is already required by law, as long as the 
emissions reductions that will result from that contingency measure 
have not been accounted for in the attainment and reasonable further 
progress demonstrations. If the reductions from the contingency measure 
are not available for any other use, then they are surplus that is set 
aside in the event reasonable further progress or attainment is not 
achieved.
    A key element of a valid contingency measure reduction is that the 
State may not use the reduction in its attainment or reasonable further 
progress demonstrations if it is already using the reduction as a 
contingency measure. Those demonstrations must account for the actual 
emissions reductions that will make reasonable further progress 
towards, and achieve attainment of the NAAQS in the absence of 
contingency measures.

I. Transportation Conformity

    Transportation conformity is required under CAA section 176(c) (42 
U.S.C. 7506(c)) to ensure that Federally supported highway and transit 
project activities are consistent with (``conform to'') the purpose of 
the SIP. Conformity currently applies to areas that are designated 
nonattainment, and those redesignated to attainment after 1990 
(``maintenance areas'' with plans developed under CAA section 175A) for 
the following transportation-related criteria pollutants: ozone, 
particulate matter (PM2.5 and PM10), carbon 
monoxide (CO), and nitrogen dioxide (NO2). Conformity to the 
purpose of the SIP means that transportation activities will not cause 
new air quality violations, worsen existing violations, or delay timely 
attainment of the relevant NAAQS (or ``standards'').
    The final PM2.5 implementation rule does not contain any 
revisions to the transportation conformity regulation. The EPA 
addressed the transportation conformity requirements that apply in 
PM2.5 nonattainment and maintenance areas in three separate 
rulemakings as described below.
    First, on July 1, 2004, EPA published a final rule (69 FR 40004) 
that addressed the majority of requirements that apply in 
PM2.5 areas including:
     Regional conformity tests to be used in conformity 
determinations both before and after SIPs are submitted and motor 
vehicle emissions budgets are found adequate or are approved;
     Consideration of direct PM2.5 emissions in 
regional emissions analyses;
     Consideration of re-entrained road dust in 
PM2.5 regional emissions analyses;
     Consideration of transportation construction-related 
fugitive dust in PM2.5 regional emissions analyses; and
     Compliance with PM2.5 SIP control measures.
    Then on May 6, 2005, EPA promulgated a final rule (70 FR 24280) 
that specified the transportation-related PM2.5 precursors 
and when they apply in transportation conformity determinations in 
PM2.5 nonattainment and maintenance areas.
    Finally, on March 10, 2006, EPA promulgated a final rule (71 FR 
12468) that establishes the criteria for determining which 
transportation projects must be analyzed for local particle emissions 
impacts in PM2.5 and PM10 nonattainment and 
maintenance areas. If required, an analysis of local particle emissions 
impacts is done as part of a transportation project's conformity 
determination.
    Transportation conformity for the PM2.5 standards began 
applying in PM2.5 nonattainment areas on April 5, 2006, one 
year after the effective date of EPA's PM2.5 nonattainment 
designations (i.e., April 5, 2005). CAA section 176(c)(6) and 40 CFR 
93.102(d) provide a one-year grace period before conformity applies in 
areas newly designated nonattainment for a new standard. 
PM2.5 SIP submissions such as RFP and attainment 
demonstrations would identify motor vehicle emissions budgets 
(``budgets'') for direct PM2.5 or PM2.5 
precursors, as described below. These budgets would be used for 
satisfying transportation conformity requirements, once the budgets are 
found adequate or the SIP containing the budgets is approved by EPA. 
For example, state and local agencies would consider during the 
development of the PM2.5 SIP whether reductions of on-road 
mobile source S02 emissions are a significant contributor to 
an area's PM2.5 air quality problem, and if so, establish a 
S02 motor vehicle emissions budget for transportation 
conformity purposes.
    The EPA has previously addressed its intentions regarding when 
budgets must be established in PM2.5 SIPs for transportation 
conformity purposes. RFP plans, attainment demonstrations, and 
maintenance plans must include a budget for direct PM2.5 
emissions, except for certain cases as described below. All 
PM2.5 SIP budgets would include directly emitted 
PM2.5 motor vehicle emissions from tailpipe, brake wear, and 
tire wear. States should also consider whether re-entrained road dust 
or highway and transit construction dust are significant contributors 
and should be included in the PM2.5 budget. For further 
information, see 40 CFR 93.102(b) and 93.122(f) of the transportation 
conformity regulation, as well as Sections VIII-X of the July 1, 2004 
conformity rule preamble at 69 FR 40031-40036.
    Under certain circumstances, directly emitted PM2.5 from 
on-road mobile sources may be found an insignificant contributor to the 
air quality problem and NAAQS. Section 93.109(k) of the conformity rule 
states that ``[s]uch a finding would be based on a number of factors, 
including the percentage of motor vehicle emissions in the context of 
the total SIP inventory, the current state of air quality as determined 
by monitoring data for that NAAQS, the absence of SIP motor vehicle 
control measures, and historical trends and future projections of the 
growth of motor vehicle emissions.'' The EPA discussed its intentions 
for applying the insignificance provision in the July 2004 final rule 
(69 FR 40061-40063).
    In the May 6, 2005 final rule, EPA provided details regarding when 
states must establish SIP budgets for any PM2.5 precursor 
(i.e., NOX, VOCs, S02 and ammonia). If through 
the SIP process a state concludes that on-road mobile source emissions 
of one or more precursors are significant (i.e. need to be addressed in 
order to attain the PM2.5 standards as expeditiously as 
practicable), then EPA expects that the state will include a budget in 
the SIP for each of the relevant precursors. (70 FR 24287) The EPA also 
noted in the May 2005 conformity rule that, if inventory and modeling 
analyses demonstrating RFP, attainment or maintenance indicate a level 
of emissions of a precursor that must be maintained to demonstrate 
compliance with the applicable requirement, then that level of 
emissions should be clearly identified in the SIP as a budget for 
transportation conformity purposes, even if the SIP does not establish 
particular controls for the given precursor. If the state fails to 
identify such a level of emissions as a budget, EPA will find the 
submitted SIP budgets inadequate because the SIP fails to clearly 
identify the motor vehicle emissions budget as required by the 
conformity rule (40 CFR 93.118(e)(4)(iii)). (70 FR 24287) In 
determining whether the on-road mobile source emissions of a 
PM2.5 precursor are significant, state and local agencies 
would use the criteria for insignificance findings provided in 40 CFR 
93.109(k)

[[Page 20646]]

of the transportation conformity regulation. A further discussion of 
the criteria to be considered in establishing PM2.5 
precursor budgets is contained in the May 2005 final transportation 
conformity rule (70 FR 24282-24288). If state and local agencies 
conclude that on-road sources of a precursor are not a significant 
contributor to the area's PM2.5 air quality problem, as 
described above, motor vehicle emissions budgets would not be 
established even though emissions may be addressed in the area's RFP 
plan, attainment demonstration and/or maintenance plan.

J. General Conformity

a. Background
    The General Conformity regulations promulgated in 1993 establish an 
implementation process where Federal agencies are responsible for 
making their own determination of conformity with State implementation 
plans (SIPs), and EPA plays an advisory role. Recognizing that it was 
impracticable to evaluate all Federal actions for conformity, EPA 
created a number of exemptions in those regulations for actions with 
insignificant or not reasonably foreseeable emission increases, 
including exemptions for Federal actions with emissions below specified 
de minimis levels. When a Federal agency must demonstrate conformity 
for an action, the regulations provide several methods for making that 
demonstration. With the designations of PM2.5 nonattainment 
areas on April 5, 2005, requirements for demonstrating conformity 
become effective in those areas on April 5, 2006.
    On July 17, 2006 EPA issued a final rule (71 FR 40420) to amend the 
General Conformity Regulations to establish de minimis levels for 
PM2.5 for the General Conformity program. The final rule 
established 100 tons/year of direct PM2.5 emissions and its 
precursors as the de minimis level where the General Conformity 
regulations would apply in PM2.5 nonattainment areas. In the 
process of finalizing the de minimis level for PM2.5 three 
comments were received. One commenter was concerned about emissions 
from burning by Federal agencies. Another commenter proposed that the 
de minimis level for emissions of direct PM2.5 should be set 
significantly lower than 100 tons--in the range of 25-50 tons per year 
(TPY) in areas that are likely to attain the PM2.5 national 
ambient air quality standard within 5 years, and a level of 10-25 TPY 
in areas that are likely to take more than 5 years to achieve the 
national ambient air quality standard. A third commenter supported the 
proposed de minimis level.
    The final rule revises the tables in sub-paragraphs (b)(1) and 
(b)(2) of the General Conformity Regulations by adding a de minimis 
emission level for PM2.5 and its precursors. This action 
maintained our past policy of consistency between the conformity de 
minimis emission levels and the size of a major stationary source under 
the New Source Review program (70 FR 65984). These levels are also 
consistent with the levels promulgated for Reasonably Available Control 
Technology applicability levels for volatile organic compound and 
nitrogen oxide emissions in subpart 1 areas under the 8-hour ozone 
implementation strategy (68 FR 32843). Since EPA is not finalizing any 
classifications for the PM2.5 nonattainment areas, we did 
not establish differing PM2.5 de minimis emission levels for 
higher classified nonattainment areas.
b. Comments and Responses
    Comment: One commenter requests that EPA communicate to all Federal 
agencies the value of the agencies advising the States as soon as 
possible of any planned future projects in nonattainment areas that may 
be above the General Conformity de minimis values or that will have to 
be evaluated to show that they are below de minimis. This is for 
projects that are very likely to proceed. The aim is to consider these 
future emissions in any growth projections during SIP development since 
such growth may not be anticipated well by the available growth model 
(E-GAS). States can communicate with existing Federal facilities now 
concerning this issue.
    Response: The EPA sees the value in Federal agencies working with 
States to anticipate growth in emissions and include those anticipated 
emissions in the applicable SIP. The EPA is in the process of proposing 
regulatory amendments to the General Conformity regulations that 
provide a framework for Federal facilities to work with States to 
account for facility-wide emissions in SIPs and to include Federal 
facility emissions in future SIPs. The EPA anticipates that these rule 
amendments should be proposed before the end of summer 2006.
    Comment: Some commenters stated that the de minimis level for 
PM2.5 for conformity applicability should be less than 100 
tons per year. A level of 50 tons per year was suggested for direct 
PM2.5 emissions.
    Response: Similar comments were received when the PM2.5 
de minimis level was proposed on April 5, 2006. The response to those 
comments can be found in the preamble to the final rule setting the de 
minimis level for PM2.5 at 71 FR 40420.
    Comment: Are the precursors for general conformity consistent with 
this rulemaking or with the transportation conformity rulemaking?
    Response: The precursors for general conformity are generally 
consistent both with this rule and the transportation conformity rule. 
The only difference between the transportation rule and this rule is 
that SO2 is not considered a precursor for transportation 
conformity determinations that occur prior to a PM2.5 SIP 
unless EPA or the State air agency finds on-road mobile source 
emissions significant. For more information, see the May 6, 2005 
transportation conformity rule on PM2.5 precursors at 70 FR 
24283. Since general conformity includes analysis of stationary sources 
the general conformity rule requires SO2 as a precursor both 
before and after a PM2.5 SIP is submitted.
    Comment: When will rulemaking containing the de minimis levels for 
PM2.5 and for the precursors be issued? There is some 
confusion, since the proposed rule says that states should assume 100 
tpy for all PM2.5 pollutants, as this would make it 
consistent with the levels for NOX and VOC for the subpart 1 
areas under 8-hour ozone. However, since New Jersey's classification is 
moderate under the 8-hour ozone standard and we are in an Ozone 
Transport Region, the de minimis level for VOC is 50 tons per year.
    Response: On July 17, 2006 EPA issued a final rule (71 FR 40420) to 
amend the General Conformity Regulations to establish de minimis levels 
for PM2.5 for the General Conformity program. The final rule 
established 100 tons/year of direct PM2.5 emissions and its 
precursors as the de minimis level where the General Conformity 
regulations would apply in PM2.5 nonattainment areas. Since 
EPA is not finalizing any classifications for the PM2.5 
nonattainment areas, we did not establish differing PM2.5 de 
minimis emission levels for based on a classification scheme.
    Comment: If a Statement of Conformity has been issued on a project 
and if the project has not been completed to date, are they required to 
address PM2.5 prior to completion of the project or will 
they be grandfathered in?
    Response: If a Federal action has completed a conformity 
determination and the action has started (regardless of whether the 
project is complete or not) then no new determination is needed. If

[[Page 20647]]

the conformity determination was completed, but the action did not 
start in 5 years a new determination is needed under the general 
conformity rules.
    Comment: What guidance should states use to establish budgets for 
large facilities or military bases?
    Response: The EPA has not issued any guidance for States and 
Federal facilities to establish facility-wide budgets in the applicable 
SIP. There is nothing in the General Conformity regulations preventing 
this approach which would allow Federal actions that do not increase 
total facility emissions over the budget in the SIP from determining 
the action conforms on the basis of its compliance with the budget 
limit. The EPA sees this practice as a positive step to encourage 
States and Federal agencies to work together to account for emissions 
in a SIP so they conform with the purposes and goals of the SIP. The 
EPA intends to address the approach and provide guidance in planned 
revisions to the General Conformity regulations which are expected to 
be proposed in 2006.

K. Emission Inventory Requirements

a. Background
    Emission inventories are critical for the efforts of State, local, 
tribal and federal agencies to attain and maintain the NAAQS that EPA 
has established for criteria pollutants including PM2.5. 
Pursuant to its authority under section 110 of Title I of the CAA, EPA 
has long required States to submit emission inventories containing 
information regarding the emissions of criteria pollutants and their 
precursors. The EPA codified these requirements in 40 CFR part 51, 
subpart Q in 1979 and amended them in 1987.
    The 1990 CAAA revised many of the provisions of the CAA related to 
attainment of the NAAQS and the protection of visibility in mandatory 
Class I Federal areas (certain national parks and wilderness areas). 
These revisions established new emission inventory requirements 
applicable to certain areas that were designated nonattainment for 
certain pollutants. In the case of particulate matter, the emission 
inventory provisions are in the general provisions under Section 
172(c)(3).
    In June 2002, EPA promulgated the Consolidated Emissions Reporting 
Rule (CERR) (67 FR 39602; June 10, 2002), 40 CFR part 51 subpart A. The 
CERR consolidated the various emissions reporting requirements that 
already existed into one place in the CFR, established new reporting 
requirements for PM2.5 and ammonia, and established new 
requirements for the statewide reporting of area source and mobile 
source emissions.
    The CERR established two types of required emission inventories: 
annual inventories, and 3-year cycle inventories. The annual inventory 
requirement is limited to reporting statewide emissions data from the 
larger point sources. For the 3-year cycle inventory, States need to 
report data from all of their point sources plus all of the area and 
mobile sources on a statewide basis. A special case existed for the 
first 3-year cycle inventory for the year 2002 which was due on June 1, 
2004.
    The EPA issued guidance suggesting that 2002 be used as the Base 
Year for 8-hour ozone, PM2.5 and regional haze planning 
efforts (November 18, 2002 EPA memorandum ``2002 Base Year Emission 
Inventory SIP Planning: 8-hr Ozone, PM2.5 and Regional Haze 
Programs'' http://www.epa.gov/ttn/chief/eidocs/2002baseinven_102502new.pdf).
    States should estimate mobile source emissions by using the latest 
emissions models and planning assumptions available at the time the SIP 
is developed. Information and guidance on the latest emissions models 
is available at http://www.epa.gov/otaq/stateresources/transconf/policy.htm#models and at http://www.epa.gov/otaq/models.htm.
    By merging the information on point sources, area sources and 
mobile sources into a comprehensive emission inventory, State, local 
and tribal agencies may do the following:
     Set a baseline for SIP development.
     Measure their progress in reducing emissions.
     Have a tool to support future trading programs.
     Answer the public's request for information.
    The EPA uses the data submitted by the States to develop the 
National Emission Inventory (NEI). The NEI is used by EPA to show 
national emission trends, as modeling input for analysis of potential 
regulations, and other purposes.
    Most importantly, States need these inventories to help in the 
development of control strategies and demonstrations to attain the 
annual and 24-hour PM2.5 NAAQS. In April 1999, EPA published 
the ``Emissions Inventory Guidance for Implementation of Ozone and 
Particulate Matter National Ambient Air Quality Standards (NAAQS) and 
Regional Haze Regulations,'' EPA-454/R-99-006. The EPA updated this 
guidance in November 2005.\46\ The current version of this guidance is 
available at: http://www.epa.gov/ttn/chief/eidocs/eiguid/index.html. 
The EPA developed this guidance document to complement the CERR and to 
provide specific guidance to State and local agencies and Tribes on how 
to develop emissions inventories for 8-hour ozone, PM2.5, 
and regional haze SIPs. While the CERR sets forth requirements for data 
elements, EPA guidance complements these requirements and indicates how 
the data should be prepared for SIP submissions.
---------------------------------------------------------------------------

    \46\ Emissions Inventory Guidance for Implementation of Ozone 
and Particulate Matter National Ambient Air Quality Standards 
(NAAQS) and Regional Haze Regulations,'' (EPA-454/R-05-001, November 
2005.
---------------------------------------------------------------------------

    The SIP inventory must be approved by EPA as a SIP element and is 
subject to public hearing requirements, whereas the CERR is not. 
Because of the regulatory significance of the SIP inventory, EPA will 
need more documentation on how the SIP inventory was developed by the 
State as opposed to the documentation required for the CERR inventory. 
In addition, the geographic area encompassed by some aspects of the SIP 
submission inventory will be different from the statewide area covered 
by the CERR emissions inventory. The CERR inventory was due June 1, 
2004, while the SIP inventory due date is later. Because of this time 
lapse, the State may choose to revise some of the data from the CERR 
when it prepares its SIP inventory to account for improvements in 
emissions estimates. If a State's 2005 emission inventory (or a later 
one) becomes available in time to use for timely development of a 
nonattainment area SIP, then that inventory can be used. We also 
encourage the cooperation of the Tribes and the State and local 
agencies in preparing their emissions inventories.
b. Final Rule
    In the proposed rulemaking, in Sec.  51.1008(a), to meet the 
emission inventory requirements of section 172(c)(3), EPA proposed to 
require submission of the CERR inventories as well as ``any additional 
emission inventory information needed to support an attainment 
demonstration and RFP plan ensuring expeditious attainment of the 
annual and 24-hour PM2.5 standards.'' Section 51.1008(b) set 
forth specifications for baseline emissions inventories for attainment 
demonstrations and RFP requirements. Section 51.1008 of the final rule 
reflects our proposed rule but is different from the draft regulatory 
text. The proposal did not specify a deadline for

[[Page 20648]]

submission of the emission inventory. To ensure clarity, the final rule 
contains language addressing the deadline for submission of emissions 
inventories for nonattainment areas under section 172(c)(3) and section 
172(b), and reflects the statutory requirement of no later than 3 years 
after designation of the area. See Sec.  51.1008(a). In addition, Sec.  
51.1008(a)(1) of the proposed rule has been changed for purposes of 
clarification. The proposal referred to the requirement to submit 
statewide emission inventories under the (CERR), contained in 40 CFR 
part 51, subpart A. The final regulatory text clarifies this to refer 
to the requirements for data elements under 40 CFR part 51, subpart A. 
The EPA did not intend that the emissions inventories developed under 
the CERR, which are statewide, would be appropriate for and satisfy all 
aspects of SIP inventories developed for SIP submissions. Section 
51.1008(b) has a minor change to clarify that this subsection refers to 
the inventories required for submission under paragraph (a) of section 
51.1008, and also clarifies the reference to 40 CFR Part 51 subpart A, 
which currently contains the CERR. In addition, section 51.1008(b) as 
finalized provides that ``The baseline emission inventory for calendar 
year 2002 or other suitable year shall be used for attainment planning 
and RFP plans for areas initially designated nonattainment for the 
PM2.5 NAAQS in 2004.'' The EPA added this flexibility to be 
consistent with EPA's ozone implementation rule, and to enable a State 
to use a more recent and improved base year inventory if it is 
completed in time to allow for timely development of the attainment 
plan. As noted above, we expect that States will consult the guidance 
document titled Emission Inventory Guidance for Implementation of Ozone 
and Particulate Matter National Ambient Air Quality Standards 
(``NAAQS'') and Regional Haze Regulations, November 2005,and submit 
inventories that are appropriate for the geographic area at issue and 
consistent with regulations and this guidance. We expect the States to 
include in their SIP submission documentation explaining how the 
emissions data were calculated.
    In the proposed rulemaking, EPA asked ``What emission inventory 
requirements should apply under the PM2.5 NAAQS.'' Several 
specific questions followed this general question to assess whether or 
not additional emission inventory requirements or guidance are needed 
to implement the proposed standard. It was noted in the proposal that 
the basis for EPA's emission inventory program is specified in the 
Consolidated Emissions Reporting Rule (CERR) and the related guidance 
document titled Emissions Inventory Guidance for Implementation of 
Ozone and Particulate Matter National Ambient Air Quality Standards 
(NAAQS) and Regional Haze Regulations.
    Subsequent to the proposed rulemaking, EPA proposed the Air 
Emissions Reporting Rule (AERR) at 71 FR 69 (Jan. 3, 2006). The AERR 
would update CERR reporting requirements by consolidating and 
harmonizing new emissions reporting requirements with pre-existing sets 
of reporting requirements under the Clean Air Interstate Rule (CAIR) 
and the NOX SIP Call. At this time, EPA is reviewing 
comments submitted on the AERR proposal and expects to finalize this 
rulemaking during calendar year 2007. The AERR is expected to be a 
means by which the Agency will implement additional data reporting 
requirements for PM2.5 SIP emission inventories. Since the 
AERR rulemaking is in progress, EPA believes it is appropriate to defer 
responding to certain comments on the proposed PM2.5 
Implementation Rule related to data reporting and emission inventory 
requirements that were discussed in the AERR proposal. Those comments 
will be addressed in the final AERR rulemaking. Significant comments 
that are separable from the AERR rulemaking and relate to data 
reporting and emission inventory requirements for the PM2.5 
NAAQS are addressed below and in EPA's Responses to Comments document.
    With respect to SIP emission inventory requirements under this 
rulemaking, EPA recognizes NOX, SO2, VOCs, and 
ammonia as potential precursors of PM2.5 because these 
pollutants can contribute to the formation of PM2.5 in the 
ambient air. To provide a technical foundation for understanding 
contributions to PM2.5 nonattainment problems and for 
identifying potential future measures to reduce PM2.5 
concentrations, EPA is requiring under 40 CFR part 51 subpart A and 40 
CFR 51.1008 of this rule that States develop and submit inventories for 
direct PM2.5 and all precursors of PM2.5. This 
requirement stands apart from the policies in this rule regarding the 
required treatment of various precursor emissions in the development of 
control strategies for attaining the PM2.5 standards. With 
respect to the latter requirements, EPA has not made a finding that all 
precursors should be evaluated for potential control measures in each 
specific nonattainment area. The policy approach in the rule instead 
requires evaluation of control measures for direct PM2.5 and 
sulfur dioxide in all areas, and describes general presumptive policies 
that NOX sources need to be evaluated for control measures 
in all areas unless findings of insignificance are made, but that 
control measure evaluations are not required for sources of ammonia and 
VOC unless findings of significance are made. The rule also provides a 
mechanism by which the State and/or EPA can make an area-specific 
demonstration to reverse the general presumption for these three 
precursors. (See section II.A.8 for additional discussion on these 
issues.)
c. Comments and Responses
1. Should EPA Specify an Inventory Approval Process?
    Comment: Several commenters indicated that the current process of 
approving SIP inventories by EPA regional offices is appropriate and 
did not believe that additional approval requirements were necessary. 
Some commenters noted that flexibility is needed to address regional 
concerns. Several commenters noted that SIP emission inventories may 
include requirements or information in addition to data required by the 
Consolidated Emissions Reporting Rule (CERR). One commenter observed 
that States routinely develop information outside the CERR for purposes 
of their SIP development and that additional requirements should not be 
defined by EPA. Another commenter recommended that requirements for 
nonattainment area emission inventories be incorporated in the CERR or 
AERR. A few commenters felt that additional guidance was needed on the 
SIP emission inventory approval process.
    Response: The SIP emissions inventory is a plan provision that must 
be approved by EPA under section 110(k) of the CAA and is subject to 
public hearing requirements pursuant to section 110(a)(2). The EPA 
believes that it need not further specify a SIP approval process for 
emissions inventories beyond that set forth in the statute, regulation 
(51.1008), other related sections of this rulemaking and EPA's current 
guidance. The EPA agrees with many of the commenters that the approval 
process for SIP emission inventories need not be further defined and 
that approval should be conducted at the regional level to provide 
flexibility to address regional concerns. The EPA also agrees that use 
of Quality Assurance Project Plans developed for each state will be 
helpful in establishing the proper approval process. The EPA

[[Page 20649]]

addresses the issue of what data elements are needed for SIP approval 
in the responses to comments below, including the responses to comments 
under Issue 2, below.
    As noted by two commenters EPA describes procedures for approval of 
SIP inventories in a document titled Emissions Inventory Guidance for 
Implementation of Ozone and Particulate Matter National Ambient Air 
Quality Standards (NAAQS) and Regional Haze Regulations, November 2005. 
Section 2.5, Inventory Approval, references a memorandum titled Public 
Hearing Requirements for 1990 Base-Year Emissions Inventories for Ozone 
and CO Nonattainment Areas, September 29, 1992. The EPA intends to use 
the procedures discussed in the guidance and memorandum to the extent 
that they are applicable to approval of PM2.5 emission 
inventories submitted as part of the SIP. 40 CFR 51.1008 sets forth the 
requirements for emissions inventories under section 172(c)(3), which 
will be reviewed in the context of the SIP approval process. See also 
40 CFR 51.1007 and 51.1009 regarding attainment demonstrations and RFP 
plans. Thus, EPA believes that its existing SIP approval process is 
adequately described in statute, regulation and guidance, and that it 
provides flexibility to deal with issues that arise in individual 
nonattainment areas.
2. Are the Data Elements Specified Within the CERR Sufficient To 
Develop Adequate SIPs? For Example, in the Determination of RACT, 
Should More Information on Existing Control Devices Be Required?
    Comment: Several commenters recommended that any additional 
reporting requirements should be addressed through the CERR/AERR and 
associated guidance and that no additional reporting requirements 
should be specified in the Rule. Another commenter stated that more 
detail concerning control equipment would be helpful but was concerned 
about the additional burden on industry compared to the benefit to 
State and local agencies, and suggested that this would be further 
addressed in the context of comments on the AERR. One commenter 
believed that the reporting requirements within the CERR are sufficient 
to develop a PM2.5 SIP for most areas but noted that 
nonattainment areas may require additional inventory information which 
will need evaluation on a case-by-case basis. The commenter further 
stated that any additional inventory requirements should be identified 
during the SIP development process, in cooperation with the EPA 
regional office, and should not be part of this rule.
    Response: In section 40 CFR 51.1008(a)(1) of the final rule, EPA 
incorporates the requirements for data elements required under 40 CFR 
part 51, subpart A, which contains the CERR, for inventories submitted 
under this section. The EPA notes, however, that the issue of whether 
to require additional reporting requirements beyond those required in 
the CERR is currently being addressed in the Air Emissions Reporting 
Rule (AERR) 71 FR 69 (January 3, 2006). At this time EPA believes that 
the requirements for data elements under the CERR, in conjunction with 
the other provisions of 40 CFR 51.1008, as well as 40 CFR 51.1007 and 
51.1009, are generally adequate to meet the needs for PM2.5 
nonattainment emission inventory SIP development. The AERR as proposed 
includes additional provisions which may be helpful for 
PM2.5 SIP emission inventory development. The EPA will 
address this aspect of the AERR, including comments received in this 
rulemaking on the issues raised and the additional elements proposed in 
the AERR, in the final AERR rulemaking. This final rule indicates that 
States shall include data elements for PM2.5 inventories as 
required under 40 CFR part 51, subpart A. In addition, 40 CFR 
51.1008(a)(2) requires that States submit ``any additional emission 
inventory information needed to support an attainment demonstration and 
RFP plan ensuring expeditious attainment of the annual and 24-hour 
PM2.5 standards.'' See also 40 CFR 51.1007 and 51.1009. Thus 
States should be aware that data elements in addition to those required 
under the CERR may be needed to support attainment demonstrations and 
RFP inventories. Additional data elements needed for other SIP emission 
inventory purposes should be handled on a case-by-case basis. Because 
of the nature of SIP development, which varies depending on the nature 
and needs of individual areas, it may not be possible to require a 
level of detail in regulations that will enable a ``one-stop-shop'' 
information request as suggested by one of the commenters.
    As recommended by one commenter, guidance on reporting requirements 
is contained in Emissions Inventory Guidance for Implementation of 
Ozone and Particulate Matter National Ambient Air Quality Standards 
(NAAQS) and Regional Haze Regulations (EPA-454/R-05-001, November 
2005). For example, Section 3.2.1 for Pollutant and Pollutant 
Precursors to be Inventoried presents guidance to states on 
PM2.5 pollutants and their components that should be 
reported for PM2.5 SIP development. See also section 5, 
Emission Inventory Development, and other related sections of the 
guidance.
    With respect to the comment on additional detail on control 
requirements, see also EPA's Response to Comment Document.
3. Is the Current Approach for Reporting Specific Pollutants 
Sufficient, or Should EPA Require More Specific Emission Component 
Reporting Such as Groups of Compounds or Reporting of Elemental Carbon 
and Organic Carbon?
    Comment: Currently the CERR requires the reporting of 
SO2, VOC, NOX, CO, Pb, PM10, 
PM2.5, and NH3. VOC and PM are speciated by the 
emissions processing models based on speciation profiles for specific 
source categories. Most commenters supported retaining the existing 
reporting requirements under the CERR. Others encouraged expansion of 
the requirements to include reporting of specific organic compounds and 
organic fractions although some thought this should be a requirement 
while others thought it should be optional. One commenter thought that 
EPA should work with industry trade groups to develop and improve the 
speciation profiles of the most important source categories rather than 
asking the state and local agencies to characterize VOC and PM species. 
Several commenters thought that EPA should encourage the reporting of 
PM components (filterable, condensable and total) for development of 
control strategies and attainment demonstrations. Another commenter 
noted that including condensable emissions raises ``uncertainty'' 
issues and urged EPA to devote resources to developing better test 
methods. One commenter believed that in addition to reporting 
PM2.5 and its components, states should report all 
precursors to PM2.5 (SO2, NOX, ammonia 
and VOC).
    Response: The EPA agrees with the commenters who argued that the 
need for additional speciation should be determined based on specific 
SIP needs. 40 CFR part 51, subpart A which contains the CERR, does not 
require reporting of specific compounds or compound groups nor does it 
require reporting of organic and elemental carbon fractions. As 
discussed in the response to comment above, EPA believes that the 
requirements for data elements contained in 40 CFR part 51 subpart A, 
in conjunction with the provisions of 40 CFR 51.1008, are generally 
adequate to meet the needs for PM2.5 nonattainment emissions

[[Page 20650]]

inventory SIP development. Section 51.1008(a)(1) applies the data 
element requirements contained in 40 CFR part 51 subpart A. Section 
51.1008(a)(2) requires States to submit ``any additional emission 
inventory information needed to support an attainment demonstration and 
RFP plan ensuring expeditious attainment of the annual and 24-hour 
PM2.5 standards.'' Thus data elements in addition to those 
required under the CERR may be needed to support attainment 
demonstrations and RFP inventories under 40 CFR 51.1008(a)(2). 
Additional data elements needed for other SIP emission inventory 
purposes should be handled on a case-by-case basis. Where States need 
to develop speciated emissions for PM2.5 SIP emission 
inventories, EPA provides guidance in the document titled Emissions 
Inventory Guidance for Implementation of Ozone and Particulate Matter 
National Ambient Air Quality Standards (NAAQS) and Regional Haze Ozone 
Regulations, November 2005. Section 3.2.1, Pollutants and Pollutant 
Precursors to be Inventoried identifies pollutants and their components 
to be reported for PM2.5 SIPs. Section 3.3.5, Speciation 
Procedures, discusses the preferred approach for speciating 
PM2.5 emission inventories for use in ambient air quality 
simulations. The approach discussed in the guidance is application of 
emission models which use speciation profiles to estimate the mass of 
specific compounds and compound groups for VOC and elemental and 
organic carbon fractions for PM. The EPA encourages further research 
and development of technical tools to better characterize emissions 
inventories for specific VOC compounds and to determine the extent of 
specific VOC compounds and organic PM mass. The EPA also encourages 
States to continue efforts to refine their ammonia inventories. See 
sections II.A.3 and II.A.4 of the Preamble.
    As discussed in the guidance document, EPA encourages reporting of 
organic and elemental fractions of PM2.5 by state agencies 
(see Section 3.2.1, Pollutants and Pollutant Precursors to be 
Inventoried). While elemental or black carbon (EC/BC) and organic 
carbon (OC) will be identified in default speciation profiles, more 
locally-specific data should be collected where available as an input 
to model preprocessing. Where such data are available, they should be 
provided to EPA to help in improving EPA's speciation profiles. Certain 
organic gases have been identified as precursors to secondary organic 
aerosols (SOA). Toluene, xylene and ethyl benzene are known to be 
important SOA precursors. Additional organic gases may be identified by 
ongoing research. While these gases will be identified in default 
speciation profiles, more locally-specific data should be collected, 
where available, as an input to model preprocessing. State, local and 
Tribal agencies can contact EPA's EIAG for more information.
    EPA agrees with the comment that it should take the lead in 
updating VOC and PM profiles for most important source categories. The 
Agency is close to completing a multi-year effort to update the 
SPECIATE database. SPECIATE is EPA's repository of Total Organic 
Compound (TOC) and PM speciated profiles for a wide variety of sources. 
The profiles in this system are provided for air quality dispersion 
modeling and as a library for source-receptor and source apportionment 
type models. This recent initiative to update SPECIATE was needed 
because speciated emissions profiles continue to be developed and the 
data in the existing EPA database (SPECIATE 3.2) was becoming outdated.
    This work was coordinated with interested parties including 
industry through an Agency sponsored workgroup. It has depended largely 
on the collection and review of existing profile data to accomplish, as 
the commenter suggests, delivering the best results for the least 
amount of resources spent. Previously, these data were not widely 
available to emission inventory developers and lacked the quality 
assurance review and evaluation needed to develop profiles used by 
emissions models to generate speciated emissions. As suggested by the 
commenter, the workgroup was used to help prioritize source categories 
for investigation to ensure that updates to existing profiles and 
development of new profiles focused on areas of greatest need.
    SPECIATE v4.0 contains more than 2500 source profiles and is 
currently undergoing peer review. The EPA expects the final work 
product to be available for use by emission inventory preparers during 
early calendar year 2007 and it will be distributed through EPA's CHIEF 
Web site.
    The EPA agrees with a commenter who noted that in order to meet the 
requirements under section 172(c) of the CAA for ``a comprehensive, 
accurate, current inventory * * *,'' condensable emissions of 
PM2.5 and PM2.5 precursors are important to 
support development of local control strategies and attainment 
demonstrations. The EPA believes that the final rule provides for the 
submission of PM2.5 nonattainment area inventories meeting 
the requirements of section 172(c)(3).
    Section 51.1008(a)(1) requires that States submit emission 
inventories for PM2.5 that satisfy the data elements 
reporting requirements under 40 CFR part 51 subpart A, which contains 
the CERR. The CERR requires reporting of ``Primary PM2.5'' 
which is defined as the sum of the filterable and condensable portions 
of PM2.5. Therefore, SIP base year inventories will include 
the condensable fraction of PM which was of concern to several 
commenters. The CERR also requires reporting of SOx, NOX, 
ammonia and VOC which are potential precursors to PM2.5. EPA 
notes that the AERR as proposed would require reporting of the same 
precursors and would also require reporting of Primary 
PM2.5. However, the proposed AERR requires the reporting of 
the filterable and condensable fractions of PM2.5 (optional 
under the CERR) in addition to the primary PM2.5 total mass. 
The EPA will address this requirement in its final rulemaking on the 
AERR.
    As noted above, in addition to the data element requirements under 
section 51.1008(a)(1), under section 51.1008(a)(2) States must submit 
``any additional emission inventory information needed to support'' an 
attainment demonstration and RFP plan. Thus States should be aware that 
data elements in addition to those required under the CERR may be 
needed to support attainment demonstrations and RFP inventories under 
40 CFR Part 51.1008(a)(2). Additional data elements needed for other 
SIP emission inventory purposes should be handled on a case-by-case 
basis.
    The EPA is aware of the issues raised by one commenter regarding 
measurement uncertainty for condensable PM. This issue is addressed in 
detail under Section II.L of the preamble (``Condensable particulate 
matter test methods and related data issues,''). We believe that for 
purposes of emissions inventories and attainment demonstrations, States 
should continue to describe the impacts of baseline emissions and 
develop future air quality strategies using information available on 
primary PM2.5 emissions, including condensable 
PM2.5. However, with respect to developing enforceable 
emissions limits for condensable PM2.5 emissions, the final 
rule reflects EPA's adoption of a transition period during which we 
will allow time for development of emissions limits for condensable 
PM2.5. See 40 CFR 51.1002(c).
    For additional comments and responses related to speciation issues,

[[Page 20651]]

see the Response to Comments Document.
4. Should EPA Require That States Develop Their Own Estimates for Area 
and Mobile Source Emissions?
    Comment: The CERR allows states to adopt EPA developed emission 
estimates from area and mobile sources in lieu of making those 
estimates themselves if they accept these estimates for their emission 
inventory. One commenter thought that EPA should require States to 
develop their own estimates for area and mobile sources based on the 
specified 2002 base year. Three commenters thought that the existing 
process (under the CERR) was adequate. One of the commenters expressed 
concerns about the reporting burden for States if they were required to 
compile their own mobile and area source inventories. Another commenter 
did not believe that States should be required to submit data on area 
and mobile sources but noted that many States would continue to run the 
MOBILE model for onroad mobile sources and calculate area source data 
for SIP emission inventories. Two of the commenters thought that the 
existing process provided flexibility needed by States to focus on 
source categories of most concern and address problematic areas with 
special inventory needs. One commenter recommended that EPA continue 
developing models for area and mobile sources.
    Response: The EPA strongly encourages states to submit their own 
estimates for area (nonpoint) and mobile sources unless they can 
establish that it is impracticable to do so, given time and resources. 
We will continue, in appropriate circumstances, to allow a State to use 
EPA-developed emission estimates for mobile and nonpoint sources in 
lieu of making those estimates itself if the State accepts the 
estimates for its emission inventory. While this has been the case with 
respect to reporting under the CERR for the 3-year cycle inventories, 
for development of emission inventories to support PM2.5 
SIPs, the ability to rely on EPA-developed emission estimates for 
development of emission inventories to support PM2.5 SIPS is 
more complex and problematic. For mobile sources, the practical use of 
these EPA-developed mobile source inventories in a SIP may be very 
limited. While EPA has developed inventories for 2002, states will 
still have to develop attainment year inventories, including 
projections of future activity and the effects of control measures. For 
mobile sources, future year inventories are not developed by simply 
growing a base year inventory, but instead are developed by running an 
emissions model with appropriate inputs for the future year. In order 
to develop an attainment demonstration that accurately accounts for the 
change in emissions from the base year to the attainment year, 
inventories for both of those years will need to be developed using 
consistent methods and modeling assumptions. For mobile sources 
especially, it may be very difficult for states to replicate the 
methods used by EPA for the base year when creating the attainment year 
inventory.
    In addition, states cannot use the EPA developed inventories for 
the base year if newer models or planning assumptions are available at 
the time they begin working on the SIP. For example, if new or better 
information about the composition of the local fleet of highway 
vehicles in the base year becomes available to the state after the EPA 
developed inventories were created, that information should be used by 
the state to create a new base year inventory.
    Given the need for emissions modeling for mobile sources in the 
projection year, the need for consistency in tools and methods between 
the base year and attainment year, and the need to use latest available 
models and planning assumptions, EPA believes that most if not all 
states will choose to develop their own base year inventories for 
mobile sources.
    With respect to nonpoint (area) source emissions, States must make 
every effort, consistent with available timing and resources to ensure 
that their area source emission inventories are as accurate as 
possible. While EPA prepares a national area source emission inventory 
that covers all counties, it is designed for national analyses. EPA 
does not have access to the more detailed information available to 
States that is used to develop an area source inventory. Therefore, 
states should develop as much of their area source inventory as 
possible using local and State information, and in particular should 
develop the inventory for the most significant area source categories 
which are critical to ensuring overall accuracy. Where time and 
resources preclude a State from developing the estimates for less-
critical area source categories, the State may rely on EPA-developed 
area source emissions information for those categories.
    The EPA points out that although guidance has recommended that 2002 
be used as the base year for emissions inventories for states initially 
designated nonattainment in 2004-5, states remain free to use an 
alternate base year, as appropriate. Section 51.1008(b) provides in 
relevant part that ``The baseline emission inventory for calendar year 
2002 or other suitable year shall be used for attainment planning and 
RFP plans for areas initially designated nonattainment for the 
PM2.5 NAAQS in 2004.''
    EPA agrees with the comment that it should continue to develop 
models and other emission estimation tools. As an example, EPA's Office 
of Transportation and Air Quality (OTAQ) is developing a modeling 
system termed the Motor Vehicle Emission Simulator (MOVES). This new 
system will estimate emissions for on-road and nonroad sources, cover a 
broad range of pollutants, and allow multiple scale analysis, from 
fine-scale analysis to national inventory estimation. When fully 
implemented MOVES will serve as the replacement for MOBILE6.2 and 
NONROAD. In addition, as the NEI is reengineered, OAQPS will examine 
the need for updating emissions estimation guidance materials and 
developing tools which will assist State agencies in estimating 
emissions from area source categories. See also EPA's ``Emissions 
Inventory Guidance for Implementation of Ozone and Particulate Matter 
National Ambient Air Quality Standards (NAAQS) and Regional Haze 
Regulations,'' November 2005.
5. Other Inventory Issues
    The EPA's responses to additional comments concerning emission 
inventory issues can be found in EPA's Response to Comments Document.

L. Condensable Particulate Matter Test Methods and Related Data Issues

a. Background
    As noted in the preamble to the November 1, 2005 proposed rule, 
certain commercial or industrial activities involving high temperature 
processes (fuel combustion, metal processing, cooking operations, etc.) 
emit gaseous pollutants into the ambient air which rapidly condense 
into particle form. The constituents of these condensed particles 
include, but are not limited to, organic material, sulfuric acid, and 
metals. Because condensable emissions exist almost entirely in the 2.5 
micrometer range and smaller, these emissions are inherently more 
significant for PM2.5 than for prior particulate matter 
standards addressing larger particles. Therefore, we believe that it is 
important that the air quality management of particulate matter promote 
a comprehensive approach to condensable particulate matter.

[[Page 20652]]

    We proposed to require a comprehensive inclusion of condensable PM 
for all aspects of SIP development for PM2.5. Under the 
proposal, EPA would require condensable PM to be considered in the 
emissions inventories and analyses used in attainment demonstrations. 
Also under the proposal, any stationary source emissions limits 
developed to implement RACT or RACM would reflect control and 
measurement of condensable PM.
    We received numerous comments on whether these requirements were 
unreasonable in light of the current state of knowledge of and 
uncertainties around the measurement of direct PM2.5. Most 
commenters supported the overall view that condensable PM should be 
addressed in order to provide a complete air quality management program 
for PM2.5. On the other hand, many commenters raised 
concerns about the availability and implementation of test methods and 
related issues about the uncertainties in existing data for condensable 
PM2.5. As a result of the concerns, these commenters 
believed EPA would be premature in requiring a comprehensive evaluation 
of condensable PM2.5, especially as it related to developing 
any new emissions limits for stationary sources. In recognition of 
these concerns, the final rule reflects EPA's adoption of a transition 
period during which we will assess possible revisions to available test 
methods and we will allow time for States to update emissions 
inventories as needed to address direct PM2.5 emissions. In 
this section of the preamble, we outline the elements of the final rule 
addressing inventories reflecting control of direct PM2.5. 
We also discuss the specific comments raised regarding methods for 
measuring direct PM2.5, both filterable and condensable PM, 
in implementing the rule. The particular comment areas include defining 
test methods, quantifying direct PM2.5 for inventories, and 
a transition period for developing effective regulations. Below are 
also our responses to those comments.
b. Final Rule
    For the final rule, EPA addresses two broad issues related to 
inclusion of condensable PM. The first issue is whether emissions 
inventories and attainment demonstrations should include the 
condensable portion of direct PM2.5 emissions. The second 
issue is whether direct PM2.5 emissions limitations 
established by States for purposes of RACT and RACM must include limits 
on condensable PM emissions or limits on total direct PM2.5 
that includes the condensable PM fraction.
    For purposes of developing emissions inventories and attainment 
demonstrations, the final rule reflects a requirement to account for 
significant contributors of direct PM2.5 emissions, both 
filterable and condensable PM2.5. We recognize that some 
States have established inventories consistent with requirements of the 
consolidated emissions reporting rule (CERR) to report direct 
PM2.5 emissions, including condensable PM, in each inventory 
revision. While uncertainties remain with significant issues to address 
related to our current knowledge base on condensable PM emissions, we 
believe that for purposes of emissions inventories and attainment 
demonstrations, States should continue to describe the impacts of 
baseline emissions develop future air quality strategies using 
information available on direct PM2.5 emissions including 
condensable PM.
    With respect to developing enforceable emissions limits for 
condensable PM emissions, we note that some States have established 
emissions limits or otherwise require PM emissions testing that 
includes measurement of condensable PM. We recognize that in some 
States there remain questions about the viability of available test 
methods, the availability of representative direct PM2.5 
emissions data, the uncertainty of the methods used to establish 
inventories, and the short time frame within which States must develop 
SIPs. In response we have decided to provide a transition period for 
developing emissions limits and regulations for condensable 
PM2.5. During this transition period, we will provide 
technical support to States as requested in establishing effective 
PM2.5 emissions limits and corresponding emissions testing 
requirements.
    As described further below, we will devote resources early during 
this transition period to assessing and improving the available test 
methods for condensable PM. During this transition period, we will also 
solicit the involvement of stakeholders with an interest in conducting 
emissions testing to collect updated direct PM2.5 emissions 
data. The purpose of these stakeholder projects will be to collect new 
direct filterable and condensable PM emissions data using methodologies 
that provide data more representative of source direct PM2.5 
emissions. The EPA, States, and others will use these data to improve 
emissions factors and to help define or revise source emissions limits 
in permits and State implementation plans.
    The time required for our stakeholders and EPA to complete the test 
method assessment will limit the degree to which State and local 
agencies can address effectively the necessary direct PM2.5 
regulations in inventories and in the 2008 SIP submittals. In 
recognition of this, we will not require that the emissions limits 
included in the 2008 submittals account for the condensable fraction of 
direct PM2.5 or to establish limits for total direct 
PM2.5, including condensable PM.
    We will expect States to continue developing more complete 
inventories with regard to direct PM2.5 emissions, 
particularly for condensable PM, during this transition period. We 
expect no such allowance period for method assessment or data 
collection to be necessary for implementing regulations addressing 
precursor PM2.5 emissions.
    The period of transition for establishing emissions limits for 
condensable direct PM2.5 will end January 1, 2011. We expect 
States to address the control of direct PM2.5 emissions, 
including condensable PM, with any new actions taken after January 1, 
2011. For example, States must address condensable PM emissions in any 
direct PM2.5 emissions limits resulting from midcourse 
reviews. Additionally, EPA expects that any direct PM2.5 
regulations or limits developed under any new NAAQS for particulate 
matter would also address condensable PM emissions.
    Notwithstanding the issues and uncertainties related to condensable 
PM, EPA encourages States to identify measures for reducing condensable 
PM emissions, particularly where those emissions are deemed significant 
contributors to the control strategy needed for expeditious attainment. 
We wish to clarify that in order to take credit in the SIP for 
reduction of any such condensable PM emissions, there must be 
enforceable limitations that ensure that reduction in condensable PM 
emissions. These enforceable limits could take the form of a limitation 
on the condensable PM emissions or total direct PM2.5 
emissions (or a commitment to develop such limitations after the end of 
the transition period described above). Alternatively, these 
enforceable limitations could provide for enforceable conditions that 
ensure that the effect on condensable PM emissions is assured (for 
example, enforceable limitations on operating temperature, or limits on 
FGD scrubber operations which have the effect of reducing condensable 
PM emissions).

[[Page 20653]]

c. Comments and Responses
    We received many comments on quantification of direct 
PM2.5 emissions particularly about the need to conduct 
further validations for the available test methods, the availability of 
direct filterable or condensable PM2.5 data or lack thereof 
for representative baselines, and the procedures for applying baseline 
data for developing effective regulations.
1. Method 202
    Comment: A majority of commenters characterized the performance of 
Method 202 as lacking in reliability. Some commenters characterized the 
formation of artifacts in Method 202 as significant and the primary 
reason for their recommendation to defer the inclusion of condensable 
particulate matter in the baseline assessments and regulatory 
development for the initial SIPs. The commenters stated that the 
principal artifact formed when using Method 202 was the result of 
SO2 dissolving in the impinger water and converting to 
sulfuric acid.
    Response: We agree that SO2 in particular, and perhaps 
other gaseous compounds, can react with the collecting liquids used in 
the method to form materials (artifacts) that would not otherwise be 
solid or liquid or would not condense upon exiting the stack. We 
believe that when Method 202 is applied appropriately (i.e., with the 
N2 purge as prescribed), the SO2 artifact 
formation is reduced by as much as or more than 90 percent; however, we 
agree that further verification and refinement would be appropriate to 
verify the potential for artifact formation.
    In response, we are undertaking laboratory studies in collaboration 
with several stakeholders to characterize the artifact formation and 
other uncertainties associated with conducting Method 202, and to 
identify procedures to be used in applying methods to minimize 
uncertainties. We are involving stakeholders representing industry and 
State and local agencies in the project design and results review. 
Stakeholders who have expressed interest in participating in these 
studies include the Electric Power Research Institute, companies 
associated with the National Environmental Development Association's 
Clean Air Project (NEDA/CAP), the Portland Cement Association, the Lime 
Manufacturing Association, the American Foundry Association, the 
National Aluminum Association, and several governmental organizations 
represented by National Association of Clean Air Agencies. Other 
parties may participate in the study as well.
    By the end of 2007, we intend to have conducted a comprehensive 
laboratory study that examines the relationship between several 
critical condensable PM sampling and analysis parameters (e.g., 
SO2 concentration, moisture concentration, sample duration, 
and water acidity) and the artifact formation associated with the 
measurements. One intended result of the project will be identifying 
possible modifications to Method 202 to minimize and quantify the 
uncertainties. We will publish the results of the laboratory study 
along with an assessment of other input and data from stakeholders on 
the EPA website and, to the extent possible, in a widely circulated 
peer review journal. Also, to the extent necessary, we intend to 
propose revisions to the method to incorporate improvements and to 
clarify application.
2. Conditional Test Methods 039 and 040
    Comment: Several commenters cited as a deficiency that neither 
conditional test method 040 (CTM-040) for measuring filterable 
PM2.5 nor the dilution sampling method (CTM-039) has been 
thoroughly validated through EPA Method 301. There were also comments 
that neither of the CTMs was published in the Federal Register.
    Response: We agree with the comments that neither method has been 
subjected to adequate public notice and comment rulemaking. Taking that 
step will facilitate application of the appropriate methods for 
implementing the SIPs. On the other hand, there are a number of levels 
of validation already achieved for one or more of these methods that 
will determine what, if any, additional validation work will be 
necessary. For example, while we could seek resources to evaluate 
dilution sampling technology, including CTM-039, and to request public 
involvement in the project planning, conduct, and review with the 
possibility of a Federal Register proposal, our preference would be to 
incorporate by reference an approved voluntary consensus test method 
(e.g., ASTM standard).
    We believe that a dilution sampling method for measuring direct 
PM2.5 eliminates essentially all artifact formation and 
provides the most accurate emissions quantification. To the extent that 
we need to and can secure resources and stakeholder interest, we plan 
to perform additional validation testing of CTM-039 or other dilution 
sampling technologies to characterize the precision of this approach. 
In conjunction with our validation efforts, we intend to continue 
participation in the ASTM D22 committee to develop and publish a 
dilution sampling method and encourage other volunteers on that 
committee to approve the consensus based dilution sampling method. We 
believe that this work is nearly complete. As outlined above, we are 
already undertaking laboratory studies to assess the method and to 
identify possible modifications to reduce formation of these artifacts. 
Preliminary laboratory evaluations conducted by EPA and by Environment 
Canada\47\ indicate that additional artifact reductions of 60 to 90 
percent may be achieved with other minor modifications to Method 202. 
These preliminary findings indicate that Method 202 is essentially a 
viable method that these proposed laboratory studies will serve to 
enhance. Within 18 months we intend to propose, if necessary, 
modifications to Method 202 or similar methodologies suitable for 
measuring condensable PM2.5.
---------------------------------------------------------------------------

    \47\ ``Optimized Method 202 Sampling Train to Minimize the 
Biases Associated with Method 202 Measurement of Condensable 
Particulate Matter Emissions,'' John Richards, Tom Holder, and David 
Goshaw, Air Control Techniques, P.C.; Air & Waste Management 
Association, Hazardous Waste Combustion Specialty Conference AWM, 
November 2-3, 2005, St. Louis, MO.
---------------------------------------------------------------------------

    As for CTM-040, we believe that further validation of this method 
is unwarranted since the technology and procedures are based upon the 
same as evaluated for promulgated Method 201A. Method 201A has 
undergone public review and comment (55 FR 14246, April 17, 1990). 
Also, as noted earlier, we have already begun laboratory and data 
evaluation work the possible result of which would be a revised Method 
202 to be proposed in the Federal Register to include improvements 
indicated by the evaluation. At that same time, we may propose CTM-040 
to be used in combination with Method 202 for measuring direct 
PM2.5 with additional guidance on appropriate approaches to 
testing for direct PM2.5 emissions from various types of 
control measures (e.g., electrostatic precipitator and flue gas 
desulphurization combinations).
3. Role of Condensable PM Emissions in Defining RACT
    Comment: Commenters indicated that States must reassess and revise 
emissions limits if the States adopt methods for measuring direct 
PM2.5 including condensable PM where not required 
previously. Commenters noted that most existing PM emissions limits are 
not reflective of data collected with

[[Page 20654]]

methods that measure condensable or filterable PM2.5 and, 
therefore, not enforceable using a new or different test method.
    Response: We agree that coordinating the test method with the 
pollutant defined by the emissions limit is critical to an effective 
regulation. In the case of direct PM2.5 regulations, the 
methods for measuring filterable and condensable PM provide data that 
are significantly different than do methods often used in implementing 
many current regulations (i.e., filterable plus condensable 
PM2.5 versus filterable PM only). The existing PM emissions 
regulations implementing many current SIPs have focused almost 
exclusively on filterable PM at stack conditions or other elevated 
temperatures (e.g., 250 [deg]F) with little or no measurement of 
condensable PM, let alone filterable PM2.5. These 
deficiencies exist in spite of the Agency's policies and guidance 
presented in documents such as the 1987 PM10 SIP Development 
Guideline \48\ and the General Preamble for the Implementation of Title 
1 of the Clean Air Act Amendments of 1990 \49\ issued in 1992. These 
documents set forth Agency policy stating that direct PM10 
and direct PM2.5 emissions include both filterable and 
condensable particulate matter. The policies are reinforced by a 2005 
directive from the CAA Advisory Committee.\50\
---------------------------------------------------------------------------

    \48\ U.S. Environmental Protection Agency. PM-10 SIP Development 
Guideline. Office of Air Quality Planning and Standards, Research 
Triangle Park, NC. EPA Publication No. EPA-450/2-86-001. June 1987.
    \49\ The General Preamble is available online at http://www.epa.gov/ttn/oarpg/t1pfpr.html.
    \50\ Clean Air Act Advisory Committee, Recommendations to the 
Clean Air Act Advisory Committee--Phase I and Next Steps, Air 
Quality Management Work Group, Environmental Protection Agency, 
http://www.epa.gov/air/caaac/pdfs/report1-17-05.pdf, January 2005.
---------------------------------------------------------------------------

    More to the point, the use of test methods that quantify only 
filterable PM would limit the capability of any assessment of control 
measures available for developing cost effective strategies to achieve 
attainment of the PM2.5 NAAQS. Examples include an 
attainment demonstration that includes control methodologies for PM 
precursors which are likely to result in a significant decrease in the 
emissions of direct PM2.5 (for example, alkaline scrubbers 
to reduce SO2 emissions) and incorporate these direct 
PM2.5 emissions reductions in their attainment demonstration 
or allow for the use of these reductions as credits for other programs.
    Some States may decide to measure and control condensable PM 
emissions prior to the end of the transition period. To the extent that 
a State has the supporting technical information and test methods, the 
State may also assess the capabilities of current control technologies, 
possible modifications to such technologies, or new technologies as 
appropriate relative to control of condensable PM2.5 
emissions in developing effective control strategies and regulations. 
As an example, a specific approach for controlling condensable PM could 
be a change in control device operating temperature to achieve 
necessary emissions reductions. We also note that it is important that 
implementation of any new or revised rules and test methods should be 
prospective and clearly differentiated from existing regulations to 
avoid confusion over status of compliance relative to existing PM 
emissions limits.
4. Sufficiency of Current Baselines Relative to Direct PM2.5 
for Regulatory Development
    Comment: Many commenters indicated that the currently available 
baselines for direct PM2.5 emissions are not sufficient for 
States to develop effective emissions control regulations. One 
commenter claimed that States will need additional information 
regarding how to arrive at enforceable PM2.5 emissions 
limitations through application of correlations to existing 
PM10 emissions limitations.
    Response: We agree that State inventories accounting for direct 
PM2.5 emissions are important to the NAAQS implementation 
decision-making process. For example, the current national emissions 
inventories have characterized the contribution of the condensable PM 
emissions to range from 40 to 80 percent of the direct PM2.5 
emissions particularly from combustion source categories. We also agree 
in many cases, the emissions baselines are not sufficiently 
representative of significant direct PM2.5 contributors to 
allow States to develop effective and enforceable emissions limitations 
for sources that may require control of direct filterable or 
condensable PM2.5 emissions in order for States to come into 
attainment with the PM2.5 NAAQS.
    We note that States are already required under the consolidated 
emissions reporting rule (CERR) to report direct PM2.5 
emissions, including condensable PM, in each inventory revision. That 
means that inventories and associated baselines must address sources 
and contributions of direct PM2.5 emissions, both filterable 
and condensable PM, from individual sources and groups of sources as 
well as for future year projected emissions. These data are important 
for the purposes of calculating emissions reductions and demonstrating 
that such reductions are attributable to the control measures being 
implemented.
    In taking the process to the next step, we contend that many 
current baselines established using the available direct filterable and 
condensable PM2.5 national industry average emissions 
factors (e.g., those found in AP-42 and WebFIRE, http://www.epa.gov/ttn/chief/efpac/index.html) often are of quality insufficient to 
establish effective source-specific emissions limits. First, national 
industry average emissions factors are subject to significant 
uncertainties as they usually represent data from a very limited number 
of example facilities in a category and for a very limited number of 
operating conditions. Second, the available emissions factors databases 
may not include direct PM2.5 emissions data for specific 
source types that appear in some State and local inventories.
    In short, we believe that States should rely on directly measured 
emissions data in developing source category or pollutant-specific 
emissions limits for regulations. This approach is preferable to the 
use of these national industry average emissions factors such as those 
found in AP-42. If there are no directly measured emissions data 
available from the subject sources, national average emissions factors 
should be used only with appropriate and significant adjustments for 
uncertainty. Based on our initial study \51\ of the uncertainties 
associated with national average emissions factors when applied to 
site-specific or rule-development activities, we would expect 
multipliers of 0.1 to 3.3 for an A-rated national average filterable 
and condensable direct PM2.5 emissions factors. The level of 
a particular multiplier would depend on how representative of the 
source category the applicable emissions factor is, the quantity of 
data supporting that emissions factor, and the specific application. 
Determining what adjustment may apply for a particular application 
requires detailed knowledge of the emissions control variability, the 
expected range of operational and process variability, and the 
statistical uncertainty in the measured emissions data. While more 
general adjustments to emissions factors are possible for these 
purposes, we believe that the better approach is to improve and update 
the emissions factors used in the database for a particular area with 
measured

[[Page 20655]]

direct PM2.5 emissions data. For these reasons and to allow 
time for data collection and analysis, we have determined the need for 
a period of transition for States in developing direct PM2.5 
emissions reduction strategies.
---------------------------------------------------------------------------

    \51\ Option Paper 4--Providing Guidance Regarding The Use Of 
Emissions Factors For Purposes Other Than Emissions Inventories, 
September 2005, http://www.epa.gov/ttn/chief/efpac/projects.html.
---------------------------------------------------------------------------

5. Transition Period
    Comment: Some commenters suggested that EPA should allow States to 
base their initial 2008 SIPs on NOX, SO2, and 
filterable PM or PM10 (as a surrogate for filterable 
PM2.5) rather than require State and local agencies to 
develop direct PM2.5 emissions regulations immediately. 
Commenters suggested that EPA provide a transition period for sources 
to adopt SIPs that address direct PM2.5 and to apply the 
appropriate test methods. The commenters proposed that during this 
transition period, a source should be able to continue to use Method 5, 
Method 17, or whatever method was used to set the underlying limit 
contained in the source's title V operating permit. Commenters believe 
that such a transition plan must provide additional time to collect 
data related to condensable PM emissions. Commenters believe that this 
additional time is necessary because it is unrealistic to develop SIP 
revisions addressing condensable emissions by April 2008. Other 
commenters suggested that source emissions inventories used for 
regulatory decision-making and identifying regulatory control measures 
must be based on accurate measurements.
    Response: As outlined above, we agree that a transition period 
should be allowed to allow time to resolve and adopt appropriate 
testing procedures for condensable PM emissions, to collect total 
(filterable and condensable) PM2.5 emissions data that are 
more representative of the sources in their areas, and develop 
effective regulations for control of direct PM2.5, including 
condensable PM.
6. Data Collection for Regulatory Development
    Comment: Several commenters recommended that EPA should be 
responsible for developing data of emissions from common sources of 
direct PM2.5.
    Response: We disagree with the commenters' recommendation that EPA 
should be primarily or solely responsible for developing baseline data 
on common sources of direct PM2.5 emissions. Commenters are 
suggesting that we should collect data representative of direct 
PM2.5 emissions from source categories potentially subject 
to regulation of direct PM2.5 emissions. Furthermore, they 
suggest that we expand or improve the current compilation of national 
industry average emissions factors such as found in AP-42 and WebFIRE 
(http://www.epa.gov/ttn/chief/efpac/index.html). Given the limited 
extent to which national industry average emissions factors are 
suitable for developing State or local regulations that set limits on 
direct PM2.5 emissions, we believe that it is inherent that 
States instead have primary responsibility for reviewing and applying 
measured emissions data collected from their sources in enhancing their 
current baselines. In some cases, this will mean that States and other 
stakeholders will need to conduct more focused direct PM2.5 
emissions data collection and improve relevant emissions factors.
    This approach is appropriate for several reasons. First, we believe 
that stakeholders other than EPA are better equipped to identify 
specific data needs and that they have the means to collect the data. 
Second, we believe we are better positioned to provide guidance on test 
planning, data collection, and emissions factors calculations with a 
less direct role in data collection and evaluation. Third, we believe 
that States in need of additional information can also benefit from 
experience of other States with similar source types and who are 
developing regulations to implement the NAAQS including the control of 
condensable PM. See also the discussion in section II.L.2.c.1 above on 
the currently active collaborative study to assess direct 
PM2.5 emissions measurement technologies and to collect 
updated direct PM2.5 emissions data.
7. Developing Effective Regulations for Direct PM2.5, 
Including Condensable PM, Emissions
    Most current PM regulations focus on the control and measurement of 
filterable PM emissions and do not account for condensable PM 
emissions. At issue are assessing and accounting for the differences in 
methodology and applicable limits when changing to a program designed 
to achieve reductions in PM2.5 emissions, including 
condensable PM.
    Comment: A number of respondents commented that EPA needs to 
promulgate a PM2.5 test method and adopt regulatory language 
that determines the PM2.5 limits based on that promulgated 
PM2.5 test method as soon as possible. Other commenters 
suggested that EPA and States have no choice but to revise the 
underlying standard by adopting new monitoring requirements through a 
notice and comment rulemaking. Further, these commenters indicate that 
it is essential that EPA require that no change in a test method or in 
methods of monitoring for determining compliance until such time as EPA 
or the permitting agency have undertaken a notice and comment process 
to determine how the emissions limitations must be revised. A number of 
commenters cited specific components necessary for effective 
regulations.
    Response: We agree that notice and comment rulemaking is 
appropriate for establishing effective regulations. As noted above, we 
are already undertaking a study of the available test methods to 
determine the need for regulatory revisions. We also agree that new 
regulations limiting direct PM2.5 emissions must include 
effective emissions limitations to the extent that a State must reduce 
sources of direct PM2.5. How a State determines to take such 
regulatory action depends on the State's implementation plan. Regarding 
the specific components necessary for effective regulations, see 
section O below on enforcement and compliance issues.

M. Improving Source Monitoring

a. Background
    In the November 1, 2005 proposal, we discussed a number of actions 
the EPA would undertake to improve the effectiveness of existing and 
new regulations with improved source monitoring provisions. 
Specifically, we repeated a plan outlined on January 22, 2004 (69 FR 
3202; a Federal Register notice describing requirements for monitoring 
in operating permits), that includes a four-part strategy for improving 
monitoring of emissions at the source where necessary through 
rulemaking. One element of that plan is for EPA to develop guidance on 
how States can reduce PM2.5 emissions by improving source 
monitoring related to PM2.5 emissions limits. We noted that 
we expect to describe in such guidance methods of improving monitoring 
frequency or adopting more appropriate monitoring for States to 
consider in developing their PM2.5 SIPs and to illustrate 
the amount of credit that States could receive in PM2.5 SIPs 
for adopting such improved monitoring. We suggested that States with 
areas where additional reductions are needed to help the area achieve 
compliance with the NAAQS could implement improved monitoring measures 
to obtain additional emissions reductions. We put forward that State 
agencies could receive SIP credits as a result of enforceable improved 
monitoring or

[[Page 20656]]

voluntary emissions monitoring programs meeting EPA voluntary program 
policies.
    Specific examples of improved monitoring we outlined included: (1) 
Conducting the currently required monitoring more frequently (i.e., 
increased monitoring frequency), (2) changing the monitoring technique 
to a parameter more closely related to control of direct or precursor 
PM2.5 emissions (i.e., a correlated parametric monitoring 
technique), (3) changing the technique to more measurement of direct 
PM2.5 emissions and PM2.5 precursors, or (4) a 
combination of these improvements. These types of monitoring 
improvements could be conducted for both controlled and uncontrolled 
emissions units. The improved monitoring control measure would require 
facilities to pay more attention to the operation of add-on air 
pollution control devices, work practices, and other control measure 
activities. The additional attention will reduce periods during which 
control devices and other control measures do not operate as intended 
or required. The result would be increased emissions reductions from 
implementing existing and new rules.
    We discussed a range of currently applied and new monitoring 
technologies. We addressed concerns we have about the limitations of 
the widespread use of visual emissions (VE) monitoring techniques, such 
as visible emissions checks, to show compliance with PM emissions 
limits. We noted particular concerns about VE approaches, even with 
frequent application, having the ability to verify compliance when the 
margin of compliance is small or the ability to detect relatively 
significant changes in emissions control performance. The other concern 
we noted about the use of VE tools is the limited frequency at which 
they are conducted. We cited studies on the availability of continuous 
instrumental methods for monitoring opacity and operational parameters 
closely related to PM control levels including the development of 
repeatable correlations between parameter levels and PM emissions. We 
noted that PM continuous emissions monitoring systems (PM CEMS) 
technology provides the opportunity to quantify PM emissions levels 
(concentration or emissions rates). These additional data provide the 
source owner/operator with a level of information that can be useful 
for understanding and operating the process and the control measures in 
ways to minimize emissions, improve operating efficiencies, and reduce 
enforcement liabilities. Furthermore, we noted that this technology 
will provide the State with quantitative information on PM emissions 
which will help improve the inventories and to implement effective 
control strategies to meet the NAAQS.
    We also discussed at some length what we believe constitutes 
improved monitoring and the potential for monitoring-related emissions 
reductions. We discussed a study of how these emissions reductions 
would be achieved by increasing the monitoring frequency or improving 
the monitoring of an add-on air pollution control device or other 
process activity above the level currently required in existing rules. 
The increased frequency or improved technique would allow owners or 
operators to achieve greater emissions reductions by identifying and 
responding more quickly to periods of ineffective control measure 
operation. States could use an improved monitoring control measure in 
regulations or through other means to reduce emissions levels and 
receive credits towards attainment. Specifically, we cited materials 
that indicate that source owners and operators who increase monitoring 
frequency could achieve emissions reductions up to 13 percent and those 
who improve the monitoring technique could achieve emissions reductions 
up to 15 percent. States with nonattainment areas in need of additional 
reductions to achieve compliance with the NAAQS could implement an 
improved monitoring measure and develop additional emissions reductions 
credits. We outlined several specific examples.
    In order to inform our improved monitoring guidance development 
efforts, we used the 2005 proposal to solicit specific comments on (1) 
how potentially inadequate source monitoring in certain SIPs could be 
improved; (2) how improved PM2.5 monitoring relates to title 
V monitoring; (3) whether instrumental techniques are more appropriate 
than visual emissions (VE) techniques for monitoring compliance with PM 
emissions limits; and (4) a basis for determining whether improved 
monitoring would be effective and under what conditions should be 
required. We also requested comment on the feasibility of monitoring of 
co-pollutant control measures and requested examples of improved 
monitoring for any applications.
b. Final Rule
    We maintain that improved monitoring is critical to implementing 
the PM2.5 direct and precursor emissions reductions 
programs. We also believe that improving monitoring both in terms of 
increasing data collection and analysis frequency and in measuring the 
pollutant of interest more directly will accomplish several important 
and advantageous outcomes. First, improved monitoring will improve 
verification of compliance and assurance of the intended emissions 
reductions. Second, improved monitoring can provide additional 
emissions reductions through quicker detection and correction of 
control measure problems. Third, improved monitoring can improve 
operating efficiencies that often result in cost savings to the 
facility exceeding the cost of the monitoring. We will continue to 
evaluate the effects of improved monitoring on emissions reductions and 
ways to quantify the benefits associated with improved monitoring.
    We intend to move forward with developing and providing additional 
technical and informational materials regarding technologies 
constituting improved monitoring and for developing regulations with 
improved monitoring. These materials may also include guidance and 
tools for establishing emissions reductions credits and the economic 
benefits associated with improved monitoring. As noted in section L 
above, we also reaffirm our policy that effective regulations must 
include certain elements that define applicable emissions limitations, 
the testing and monitoring requirements, and compliance, reporting, and 
corrective action obligations.
c. Comments and Responses
    We expected to receive practical advice concerning improved 
PM2.5 source emissions monitoring methods and field-tested 
examples. Instead, commenters focused on (1) critiquing PM CEMS 
technology (2) insisting that improving monitoring changes stringency 
of existing rules and requires rulemaking, and (3) critiquing the 
theoretical study linking emissions reductions with improved 
monitoring.
1. Currently Available PM CEMS for Monitoring Direct PM2.5 
Emissions
    Comment: Commenters noted that because currently available PM CEMS 
measure filterable PM at stack conditions or at other elevated 
temperatures, the instruments do not measure the condensable portion of 
PM2.5.
    Response: We agree with this comment relative to PM CEMS in use to 
date and the ability to detect condensable PM. PM CEMS as applied today 
can be calibrated to measure filterable PM2.5 emissions with 
very good sensitivity and repeatability. Note

[[Page 20657]]

that we are aware of a number of PM CEMS vendors developing devices 
relying on much the same technology but modified to measure condensable 
PM. Further, we are aware of at least one manufacturer offering a PM 
CEMS applicable to stationary sources that also complies with ASTM 
requirements for mobile source emissions monitoring. We also believe 
that monitoring for filterable PM2.5 will be as important in 
some cases as monitoring for condensable PM and that PM CEMS in use 
today are markedly better at monitoring PM emissions than other 
frequently used monitoring approaches.
    We realize that PM CEMS represent just one of a range of monitoring 
options that constitute improvements over the current monitoring. For 
instance, we believe that improved monitoring would include replacing 
current periodic VE measurements or daily recording of pressure drop of 
fabric filters with continuous bag leak detectors. We know of projects 
(e.g., ASTM committee work) for continuing the development of optical, 
as well as electromagnetic, monitoring tools to increase sensitivity 
and cost-effectiveness. Such monitoring would increase monitoring 
frequency and would yield data much more closely related to and more 
sensitive to control device operation than most currently applied 
monitoring. To the extent that condensable PM control is critical in 
implementing a regulation, we believe that monitoring must address that 
need. We will continue to collect and also provide information on 
source monitoring approaches that are improvements over current methods 
in both frequency and representativeness relative to implementing 
PM2.5 emissions control strategies.
2. Status of Guidance Relative to Regulations
    Comment: A significant majority of commenters suggested that 
improving monitoring in an existing regulation increases its stringency 
and requires notice and comment rulemaking, not guidance. Just one 
commenter suggested guidance could be developed and used.
    Response: There are two aspects to the comments on this issue. One 
is whether improved monitoring would change source operations. We agree 
with the commenters that increasing the frequency of data collection or 
providing data more directly related to the pollutant of concern with 
improved monitoring could result in changes in how a facility is 
operated relative to compliance. We disagree with commenters that such 
changes in process operation resulting from improved monitoring 
constitute an increase in a regulation's stringency with respect to 
compliance. First, as mentioned in the preamble to the Credible 
Evidence rule (62 FR 8326, February 24, 1997), an emissions standard's 
required stringency is unaffected by the frequency of monitoring given 
no decrease in averaging time or emissions limitation. Secondly, data 
from improved monitoring will provide a facility operator better 
information on control measure performance more quickly and allow for 
reducing the duration and the number of periods that may lead to 
compliance problems. Reducing the duration of excess emissions periods, 
for example, with improved monitoring is not an increase in regulatory 
stringency but a decrease in enforcement liability.
    The second aspect to the comment is questioning whether we can 
issue technical information about improved monitoring as guidance 
without applying it to a Federal Register notice and comment process. 
We disagree with commenters who believe that our developing and 
disseminating technical resource information is limited to notice and 
comment rulemaking. We note that making technical and other information 
materials available to the public, states, and industry is an important 
Agency function. There are many examples of the Agency dispensing such 
information including the Monitoring Knowledge Base (http://cfpub.epa.gov/mkb/) that provides just such information on improved 
monitoring. On the other hand, we agree with commenters that any 
significant change to an existing regulation, including the addition of 
new monitoring requirements, would be subject to notice and comment 
rulemaking. To the extent that States determine the need for changing 
existing or developing new regulations, public notice and comment 
rulemaking is appropriate. Our role in developing technical resources 
and information informing the states in developing those revised or new 
regulations does not require, nor should be subject to the rulemaking 
process. In that light, we recognize the value in obtaining and 
responding to public comments and suggestions on informative technical 
materials. Further, we believe rulemaking is not necessarily required 
for source owners or operators who volunteer to participate in an 
optional improved monitoring program, such as the one mentioned in the 
proposal. That program seeks to provide SIP credits to States where 
source owners or operators agree to improve their PM monitoring 
approaches. We plan on continuing to prepare and offer non-regulatory 
incentives for source owners and operators who volunteer to improve 
existing monitoring.
3. Study of Improved Monitoring-Induced Emissions Reductions
    Comment: Commenters recommended that the proposal's theoretical 
study showing PM emissions reductions from the use of improved 
monitoring needs to be validated with field data.
    Response: We agree with commenters that one should base any costs 
and benefits findings as well as validating the approach on available 
data. To the extent that this applies to assessing the benefits of 
emissions reductions achieved through improved monitoring, we requested 
that commenters provide data or leads to other information or to other 
alternatives that show how improved monitoring yields emissions 
reductions and ways to quantify possible PM credits for SIPs. In fact, 
we are disappointed that commenters failed to provide these data or 
examples of other approaches. As resources allow, we will investigate 
opportunities for field validation of the theoretical study, as well as 
other means to offer incentives for use of improved monitoring.

N. Guidance Specific to Tribes

a. Background
    The proposal set forth guidance for Tribes regarding various 
aspects of air quality management, and this guidance remains largely 
the same as described in the section below.
b. Final Rule
    The 1998 Tribal Authority Rule (TAR) (40 CFR part 49), which 
implements section 301(d) of the CAA, gives Tribes the option of 
developing tribal implementation plans (TIPs). Specifically, the TAR 
provides for the Tribes to be treated in the same manner as a State in 
implementing sections of the CAA. However, Tribes are not required to 
develop implementation plans. The EPA determined in the TAR that it was 
inappropriate to treat Tribes in a manner similar to a State with 
regard to specific plan submittal and implementation deadlines for 
NAAQS-related requirements, including, but not limited to, such 
deadlines in CAA sections 110(a)(1), 172(a)(2), 182, 187, and 191. (Add 
footnote) See 40 CFR 49.4(a). In addition, EPA determined it was not 
appropriate to treat tribes similarly to states with respect to 
provisions of the CAA requiring as a condition of program approval the 
demonstration of criminal enforcement

[[Page 20658]]

authority or providing for the delegation of such criminal enforcement 
authority. See 40 CFR 49.4(g). To the extent a tribe is precluded from 
asserting criminal enforcement authority, the Federal government will 
exercise primary criminal enforcement responsibility. See 40 CFR 49.8. 
In such circumstances, tribes seeking approval for CAA programs provide 
potential investigative leads to an appropriate federal enforcement 
agency. (end footnote)
    If a Tribe elects to do a TIP, we will work with the Tribe to 
develop an appropriate schedule which meets the needs of the Tribe, and 
which does not interfere with the attainment of the NAAQS in other 
jurisdictions. The Tribe developing a TIP can work with the EPA 
Regional Office on the appropriateness of addressing RFP and other 
substantive SIP requirements that may or may not be appropriate for the 
Tribe's situation.
    The TAR indicates that EPA is ultimately responsible for 
implementing CAA programs in Indian country, as necessary and 
appropriate, if Tribes choose not to implement those provisions. For 
example, an unhealthy air quality situation in Indian country may 
require EPA to develop a FIP to reduce emissions from sources on the 
reservation. In such a situation, EPA, in consultation with the Tribe 
and in consideration of their needs, would work to ensure that the 
NAAQS are met as expeditiously as practicable. Likewise, if we 
determine that sources in Indian country could interfere with a larger 
nonattainment area meeting the NAAQS by its attainment date, we would 
develop a FIP for those sources in consultation with the Tribe, as 
necessary or appropriate.
    The TAR also provides flexibility for the Tribe in the preparation 
of a TIP to address the NAAQS. If a Tribe elects to develop a TIP, the 
TAR offers flexibility to Tribes to identify and implement on a Tribe-
by-Tribe, case-by-case basis only those CAA programs or program 
elements needed to address their specific air quality problems. In the 
proposed Tribal rule, we described this flexible implementation 
approach as a modular approach. Each Tribe may evaluate the particular 
activities, including potential sources of air pollution within the 
exterior boundaries of its reservation (or within non-reservation areas 
for which it has demonstrated jurisdiction), which cause or contribute 
to its air pollution problem. A Tribe may adopt measures for 
controlling those sources of PM2.5-related emissions, as 
long as the elements of the TIP are reasonably severable from the 
package of elements that can be included in a whole TIP. A TIP must 
include regulations designed to solve specific air quality problems for 
which the Tribe is seeking EPA approval, as well as a demonstration 
that the Tribal air agency has the authority from the Tribal government 
to develop and run their program, the capability to enforce their 
rules, and the resources to implement the program they adopt. In 
addition, the Tribe must receive an eligibility determination from EPA 
to be treated in the same manner as a State and to receive 
authorization from EPA to run a CAA program.
    The EPA would review and approve, where appropriate, these partial 
TIPs as one step of an overall air quality plan to attain the NAAQS. A 
Tribe may step in later to add other elements to the plan, or EPA may 
step in to fill gaps in the air quality plan as necessary or 
appropriate. In approving a TIP, we would evaluate whether the plan 
interferes with the overall air quality plan for an area when Tribal 
lands are part of a multi-jurisdictional area. Because many of the 
nonattainment areas will include multiple jurisdictions, and in some 
cases both Tribal and State jurisdictions, it is important for the 
Tribes and the States to work together to coordinate their planning 
efforts. States need to incorporate Tribal emissions in their base 
emission inventories if Indian country is part of an attainment or 
nonattainment area. Tribes and States need to coordinate their planning 
activities as appropriate to ensure that neither is adversely affecting 
attainment of the NAAQS in the area as a whole.
c. Comments and Responses
    No public comments were received on this section.

O. Enforcement and Compliance

a. Background
    The proposed rule included a discussion of the specific 
requirements that must be addressed in order for SIP regulations to be 
enforceable.
b. Final Rule
    The final rule includes similar guidance on enforceable SIP 
regulations, with some additional discussion about specific elements 
that must be addressed regarding compliance testing and compliance 
monitoring. (Note that enforceable SIP regulations may address these 
key elements in different ways depending on the type of source category 
being regulated.)
    In general, for a SIP regulation to be enforceable, it must clearly 
spell out which sources or source types are subject to its requirements 
and what its requirements (e.g., emission limits, work practices, etc.) 
are. The regulation also needs to specify the time frames within which 
these requirements must be met, and must definitively state 
recordkeeping and monitoring requirements appropriate to the type of 
sources being regulated. The recordkeeping and monitoring requirements 
must be sufficient to enable the State or EPA to determine whether the 
source is complying with the emission limit on a continuous basis. An 
enforceable regulation must also contain test procedures in order to 
determine whether sources are in compliance.
    Complete and effective regulations that ensure compliance with an 
applicable emissions limit must include requirements for both 
performance testing of emissions and ongoing monitoring of the 
compliance performance of control measures. SIP regulations must 
include the following critical elements of regulatory compliance 
testing:
     Indicator(s) of compliance--the pollutant or pollutants of 
interest (e.g., filterable PM2.5 plus condensable 
PM2.5) and the applicable measurable units for expressing 
compliance (e.g., ng/J of heat input, lb/hr);
     Test method--reference to a specific EPA or other 
published set of sample collection and analytical procedures, equipment 
design and performance criteria, and the calculations providing data in 
units of the indicator of compliance (see section II.L. below for 
descriptions of available and potential improved test methods);
     Averaging time--the minimum length of each required test 
run and the requirement to average the results of the test runs (e.g., 
three runs) representing a specified period of time (e.g., 8 hours); 
and
     Frequency--the maximum time between conduct of emissions 
or performance tests (e.g., within 30 days of facility start-up and 
once each successive quarter, every 6-month period, yearly).
    In order to be complete with regard to compliance monitoring 
provisions, SIP regulations must include the following critical 
elements:
     Indicator(s) of performance--the parameter or parameters 
measured or observed for demonstrating proper operation of the 
pollution control measures or compliance with the applicable emissions 
limitation or standard. Indicators of performance may include direct or 
predicted emissions measurements, process or control device (and 
capture system) operational

[[Page 20659]]

parametric values that correspond to compliance with efficiency or 
emissions limits, and recorded findings of verification of work 
practice activities, raw material or fuels pollutant content, or design 
characteristics. Indicators may be expressed as a single maximum or 
minimum value, a function of process variables (e.g., within a range of 
pressure drops), a particular operational or work practice status 
(e.g., a damper position, completion of a waste recovery task), raw 
material or fuel pollutant content, or an interdependency between two 
or more variables;
     Measurement technique--the means used to gather and record 
information of or about the indicators of performance. The components 
of the measurement technique include the detector type or analytical 
method, location and installation specifications, inspection 
procedures, and quality assurance and quality control measures. 
Examples of measurement approaches include continuous emissions 
monitoring systems, continuous opacity monitoring systems, continuous 
parametric monitoring systems, performance testing, vendor or 
laboratory analytical data, and manual inspections and data collection 
that include making records of process conditions, raw materials or 
fuel specifications, or work practices;
     Monitoring frequency--the number of times to obtain and 
record monitoring data over a specified time interval. Examples of 
monitoring frequencies include at least one data value every 15 minutes 
for continuous emissions or parametric monitoring systems, at least 
every 10 seconds for continuous opacity monitoring systems, upon 
receipt or application of raw materials or fuel to the process, and at 
least once per operating day (or week, month, etc.) for performance 
testing, work practice verification, or equipment design inspections; 
and
     Averaging time--the period over which to average and use 
data to verify compliance with the emissions limitation or standard or 
proper operation of the pollution control measure. Examples of 
averaging time include a 3-hour average in units of the emissions 
limitation, a 30-day rolling average emissions value, a daily average 
of a control device operational parametric range, periodic (e.g., 
monthly, annual) average of raw materials or fuel pollutant content, 
and an instantaneous alarm.
    These regulatory elements are essential for effective 
implementation of the rules and clear and enforceable applicable 
requirements. We believe that approval of regulations implementing the 
SIPs must ensure that these critical elements are present and clearly 
defined to be approvable. We reiterate that the compliance obligations, 
including emissions limits and other applicable requirements, must be 
representative of and accountable to the assumptions used in the SIP 
demonstration. This accountability includes the ability to transfer the 
applicable regulatory requirements to an operating permit subject to 
EPA and public review.
    Under the Title V regulations, sources have an obligation to 
include in their Title V permit applications all emissions for which 
the source is major and all emissions of regulated air pollutants. The 
definition of regulated air pollutant in 40 CFR 70.2 includes any 
pollutant for which a NAAQS has been promulgated, which would include 
both PM10 and PM2.5. To date, some permitted 
entities have been using PM10 emissions as a surrogate for 
PM2.5 emissions. Upon promulgation of this rule, EPA will no 
longer accept the use of PM10 as a surrogate for 
PM2.5. Thus, sources will be required to include their 
PM2.5 emissions in their Title V permit applications, in any 
corrections or supplements to these applications, and in applications 
submitted upon modification and renewal.\52\ The degree of 
quantification of PM2.5 emissions required will depend on 
the types of determinations that a permitting authority needs to 
address for a particular source, the requirements of title V, and the 
informational needs and requirements of the particular State in 
question. Sources must continue to describe their PM10 
emissions in their applications as indicated above because the original 
PM10 NAAQS remains in effect.
---------------------------------------------------------------------------

    \52\ See 40 CFR 70.5(c)(3)(i), 70.5(b), and 70.7(a)(1)(i); 40 
CFR 71.5(c)(3)(i), 71.5(b), and 71.7(a)(1)(i).
---------------------------------------------------------------------------

c. Comments and Responses
    Comment: One commenter disagreed with language in the preamble to 
the proposal regarding Title V permitting requirements and the 
requirement to include various emissions information in title V permit 
applications. As described in 40 CFR 70.5(c)(3)(i) and 71.5(c)(3)(i), 
sources are required to include in their permit applications all 
emissions for which the source is major and all emissions of regulated 
air pollutants. In the preamble to the proposal, the EPA stated that in 
the past some permitted entities have been using PM10 
emissions as a surrogate for PM2.5 emissions in permit 
applications, or in corrections or supplements to applications. The EPA 
stated that upon promulgation of this rule, the EPA will no longer 
accept the use of PM10 as a surrogate for PM2.5.
    The commenter disagreed with language in the proposal stating that 
sources would be required to detail or quantify PM2.5 
emissions in permit applications, or in corrections or supplements to 
applications. The commenter asserts that the inclusion of 
PM2.5 emissions information is required in a Title V permit 
application only if there is an applicable requirement in existence for 
which the source's applicability is in question and cited to various 
examples from the memorandum entitled ``White Paper for Streamlined 
Development of Part 70 Permit Applications,'' from Lydia N. Wegman, 
Deputy Director, Office of Air Quality Planning and Standards, to Air 
Division Directors, Regions I-X, dated July 10, 1995.
    Response: The commenter is concerned that as a result of this rule 
all applications (including initial, modification, and renewal 
applications) will need to include a quantification of PM2.5 
emissions, and that a State will request that every source supplement 
or correct any existing title V application in order to provide an 
estimation of PM2.5 emissions at the source.
    The EPA is not implying that this is the case. The degree of 
quantification of PM2.5 emissions required in an application 
(including an initial, modification, or renewal application), or in a 
correction or supplement to an existing application, depends on the 
types of determinations that a permitting authority needs to address 
for a particular source, the requirements of title V, and the 
informational needs and requirements of the particular State in 
question. For example, if a source which emits PM2.5 
emissions has submitted a title V application, but a draft permit has 
not yet been issued, then the source is required to submit information 
relative to the quantification of its PM2.5 emissions if 
such information is needed or requested and it has not previously 
submitted such information. See 40 CFR 70.5(b) and 71.5(b).
    Circumstances necessitating the quantification of PM2.5 
emissions and the submittal of this information include: (1) 
Determining all of the pollutants for which a source is major; (2) 
determining whether an applicable requirement or program applies, e.g., 
determining the applicability of a SIP requirement or a PSD or 
nonattainment NSR program, etc.; or (3) determining what fees a source 
owes a permitting

[[Page 20660]]

authority as a result of considering PM2.5 emissions.
    In all circumstances, however, a State may require that a source 
quantify its PM2.5 emissions information in an application, 
supplement, or correction, even if it is not needed for the particular 
determination at issue. The State, for example, may choose to obtain 
this information for air quality planning purposes, developing emission 
inventories, or for other purposes related to its air quality 
management goals. Requesting such emissions information is an option 
for any title V permitting authority.
    The ``White Paper for Streamlined Development of Part 70 Permit 
Applications,'' referenced by the commenter, was a confirmation of EPA 
policy with respect to the fact that the specificity of emissions 
quantification can vary significantly, depending on the circumstances 
of a particular source. It is also important to note that this guidance 
document is a statement regarding the range of discretion available to 
permitting authorities in implementing the emissions quantification 
requirement, not a restriction of that discretion to minimum practices. 
Thus, States can implement this guidance document at their option, 
either in part or in its entirety.
    In summary, the purpose of the statements made in the preamble to 
the proposal was to notify sources that as of the promulgation of this 
final rule, the EPA will no longer accept the use of PM10 
emissions information as a surrogate for PM2.5 emissions 
information \53\ given that both pollutants are regulated by a National 
Ambient Air Quality Standard and therefore are considered regulated air 
pollutants. See the definition of regulated air pollutant in 40 CFR 
70.2 and 71.2.\54\ The degree of quantification of PM2.5 
emissions now required in an application (including an initial, 
modification, or renewal application), or provided in a correction or 
supplement to an existing application, will depend on the types of 
determinations that a permitting authority needs to address for a 
particular source, the requirements of title V, and the informational 
needs and requirements of the particular State in question.
---------------------------------------------------------------------------

    \53\ For background information on issues surrounding 
implementation of the PM2.5 NAAQS, see the EPA memo 
entitled ``Implementation of New Source Review Requirements in 
PM2.5 Nonattainment Areas,'' from Stephen D. Page, 
Director, Office of Air Quality Planning and Standards, to Regional 
Air Directors, Regions I-X, dated April 5, 2005.
    \54\ For background information on regulated air pollutants, see 
the EPA memo entitled ``Definition of Regulated Air Pollutant for 
Purposes of Title V,'' from Lydia N. Wegman, Deputy Director, Office 
of Air Quality Planning and Standards, to Air Division Directors, 
Regions I-X, dated April 26, 1993.
---------------------------------------------------------------------------

P. Emergency Episodes

a. Background
    In the proposal, we noted that subpart H of 40 CFR part 51 
specifies requirements for SIPs to address emergency air pollution 
episodes and for preventing air pollutant levels from reaching levels 
determined to cause significant harm to the health of persons. We noted 
that we anticipate proposing a separate rulemaking in the future to 
update portions of that rule.

The preamble to the proposal
b. Final Rule
    We have not yet proposed any rule revision related to emergency 
episodes.
c. Comments and Responses
    We received no comments on this section of the proposal.

Q. Ambient Monitoring

a. Background
    Ambient air quality monitoring for PM2.5 plays an 
important role in identifying areas violating the NAAQS, control 
strategy development, and tracking progress to attainment. We indicated 
in the proposal that States are required to monitor PM2.5 
mass concentrations using Federal Reference Method devices to determine 
compliance with the NAAQS.\55\ We did not propose any revisions to 
current ambient monitoring requirements listed in 40 CFR part 58. 
Currently, there are more than 1200 FRM monitors located across the 
country. States will need to maintain monitors in designated 
nonattainment areas in order to track progress toward attainment and 
ultimately determine whether the area has attained the PM2.5 
standards.
---------------------------------------------------------------------------

    \55\ The PM2.5 monitoring regulations are located at 
40 CFR part 58.
---------------------------------------------------------------------------

    In addition to the FRM network, EPA and the States have also 
deployed more than 250 speciation monitoring sites around the country 
to sample for chemical composition of PM2.5. The data 
provided from these speciation monitors are invaluable in identifying 
contributing source categories and developing control strategies to 
reach attainment. Source apportionment and other receptor modeling 
techniques rely on the detailed data on species, ions, and other 
compounds obtained from chemical analysis. Analyses of rural versus 
urban sites to identify which PM2.5 components comprise the 
``urban excess'' (urban minus rural levels) portion of PM2.5 
mass also rely on data from speciation monitors. The EPA encourages 
states to expand their data analysis efforts using the wealth of 
information provided from the speciation monitoring network.
b. Final Rule
    There is no change from the proposal. We are not promulgating any 
additional monitoring requirements as part of this rulemaking. Revised 
monitoring regulations were issued in 2006 along with the revised PM 
NAAQS.
c. Comments and Responses
    There were no comments on this section.

III. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under section 3(f)(1) of Executive Order (EO) 12866 (58 FR 51735, 
October 4, 1993), this action is an ``economically significant 
regulatory action.'' Implementation of the PM2.5 NAAQS is 
likely to have an annual effect on the economy of $100 million or more. 
Accordingly, EPA submitted this action to the Office of Management and 
Budget (OMB) for review under EO 12866 and any changes made in response 
to OMB recommendations have been documented in the docket for this 
action. For clarity, we note that the estimated costs and benefits of 
implementing the 1997 PM2.5 NAAQS are not created by this 
rule, because the Clean Air Act requires state implementation of the 
1997 PM2.5 standards (through state development of plans 
with enforceable requirements for sources) on a statutory timetable 
regardless of whether EPA issues this rule interpreting the statutory 
requirements. The rule reflects the statutory requirements.
    As part of the ``Regulatory Impact Analysis for Particulate Matter 
National Ambient Air Quality Standards (September 2006),'' EPA prepared 
an assessment of the estimated costs and benefits associated with 
attaining the 1997 PM2.5 NAAQS in 2015, incremental to 
currently promulgated federal and state programs including for example 
the Clean Air Interstate Rule, the Nonroad Diesel Rule, and other 
programs. This analysis is included as Appendix A of the report and is 
available in the docket for this action and on EPA's Web site at: 
http://www.epa.gov/ttn/ecas/regdata/RIAs/Appendix%20A--
2015%20Analysis.pdf. This illustrative

[[Page 20661]]

analysis finds that the estimated monetized benefits of attaining the 
1997 standards in 2015 are between $43 billion and $97 billion 
annually, and the estimated monetized costs are $6.7 billion annually. 
The RIA states: ``Note that because this analysis was intended to 
compare costs and benefits of attaining alternative standards by fixed 
dates, it did not attempt to identify for each designated 
PM2.5 area measures that may be needed to meet subpart 1 
Clean Air Act requirements, such as reasonably available measures and 
attainment as expeditiously as practicable. It is expected that 
additional costs and benefits will begin to accrue in earlier years as 
states comply with these requirements.'' (RIA, p. 1-4)

B. Paperwork Reduction Act

    The information collection requirements in this rule have been 
submitted for approval to the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. In a separate 
Federal Register notice published today, EPA is requesting comment on 
the information collection requirements of this rule. The information 
collection requirements are not enforceable until OMB approves them.
    The data collected from the State or local air agency respondents 
will include the required SIP elements prescribed in CAA sections 110 
and part D, subpart 1 of title I for Implementation plans and the 
requirements in this Implementation Rule (40 CFR 51.1000-51.1012). The 
PM2.5 SIP will contain rules and other requirements designed 
to achieve the NAAQS by the deadlines established under the CAA, and it 
also contains a demonstration that the State's requirements will in 
fact result in attainment. The SIP must meet the requirements in 
subpart 1 to adopt RACM, RACT, and provide for RFP toward attainment 
for the period prior to the area's attainment date.
    The Agency anticipates additional administrative burden during the 
3 year period of the ICR for State governments and the Agency of 
630,000 hours and 69,300 hours, respectively. Fifty percent of the 
hours are expended in the first year with the remainder evenly divided 
between the second and third years of the ICR period. Tribes are not 
required to conduct attainment demonstrations or submit the RFP, RACT, 
or RACM requirements.
    The present value of the total additional costs for State 
government respondents is estimated at $33.4 million for the 3 year 
period. On an equivalent annual basis that is $12.7 million per year 
during the 3 year period of the ICR. The present value of the Agency 
administrative cost burden is estimated at $3.7 million dollars for the 
3 year period. This is equivalent to an equal annual stream of costs of 
$1.4 million per year during the three year period. 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 purposes of collecting, validating, and verifying 
information, processing and maintaining information, and disclosing and 
providing information; adjust the existing ways to comply with any 
previously applicable instructions and requirements; train personnel to 
be able to respond to a collection of information; search 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 Regulatory Flexibility Act (RFA) generally requires an agency 
to prepare a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements under the Administrative 
Procedure Act or any other statute unless the agency certifies that the 
rule will not have a significant economic impact on a substantial 
number of small entities. Small entities include small businesses, 
small organizations, and small governmental jurisdictions.
    For purposes of assessing the impacts of this final action on small 
entities, small entity is defined as: (1) A small business as defined 
by the Small Business Administration's (SBA) 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; or (3) a small organization that is any 
not-for-profit enterprise that is independently owned and operated and 
is not dominant in its field.
    After considering the economic impacts of this final rule on small 
entities, I certify that this action will not have a significant 
economic impact on a substantial number of small entities and it is not 
necessary to prepare a regulatory flexibility analysis in conjunction 
with this final rule. The final rule governing SIPs will not directly 
impose any requirements on small entities. Rather, this rule interprets 
the obligations established in the CAA for States to submit 
implementation plans in order to attain the PM2.5 NAAQS.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 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, EPA is required by section 205 of the UMRA 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 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.
    This rule contains no Federal mandate that may result in 
expenditures

[[Page 20662]]

of $100 million or more for State, local, and Tribal governments, in 
the aggregate, or the private sector in any 1 year. The estimated 
administrative burden hours and costs associated with implementing the 
PM2.5 NAAQS are estimated in the ICR for this rule. The 
estimated costs presented there for States totals $33.4 million for a 
three-year period. Thus, this rule is not subject to the requirements 
of section 202 and 205 of the UMRA. The EPA consulted with governmental 
entities affected by this rule and has determined that this rule 
contains no regulatory requirements that may significantly or uniquely 
affect small governments, including Tribal governments.
    The CAA imposes the obligation for States to submit SIPs to 
implement the PM2.5 NAAQS. In this rule, EPA is merely 
providing an interpretation of those requirements. However, even if 
this rule did establish an independent requirement for States to submit 
SIPs, it is questionable whether a requirement to submit a SIP revision 
would constitute a Federal mandate in any case. The obligation for a 
State to submit a SIP that arises out of section 110 and section 172 
(part D) of the CAA is not legally enforceable by a court of law, and 
at most is a condition for continued receipt of highway funds. 
Therefore, it is possible to view an action requiring such a submittal 
as not creating any enforceable duty within the meaning of section 
421(5)(9a)(I) of UMRA (2 U.S.C. 658(a)(I)). Even if it did, the duty 
could be viewed as falling within the exception for a condition of 
Federal assistance under section 421(5)(a)(i)(I) of UMRA (2 U.S.C. 
658(5)(a)(i)(I)).

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.''
    At the time of proposal, EPA concluded that the proposed rule would 
not have any federalism implications. The EPA stated that the proposed 
rule would 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. The CAA establishes 
the scheme whereby States take the lead in developing plans to meet the 
NAAQS. This rule clarifies the statutory obligations of States in 
implementing the PM2.5 NAAQS. However, EPA recognized that 
States would have a substantial interest in this rule and any 
corresponding revisions to associated SIP requirements.
    Therefore, in the spirit of Executive Order 13132, and consistent 
with EPA policy to promote communications between EPA and State and 
local governments, EPA held a number of calls with representatives of 
State and local air pollution control agencies and hosted a public 
hearing in Washington, DC in November 2005. The EPA considered the 
comments from State and local governments in developing the final rule.
    EPA concludes that this final rule does not have federalism 
implications, for the reasons proposed. The final rule will not modify 
the relationship of the States and EPA for purposes of developing 
programs to implement the NAAQS. As noted above in section D on UMRA, 
this rule does not impose significant costs on State and local 
governments. (EPA estimates the costs to States to implement the 
PM2.5 NAAQS to be $33.4 million.) Thus, Executive Order 
13132 does not apply to this rule.

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.'' This final rule does not have 
``Tribal implications'' as defined in Executive Order 13175. This rule 
concerns the requirements for State and tribal implementation plans for 
attaining the PM2.5 air quality standards. The CAA provides 
for States to develop plans to regulate emissions of air pollutants 
within their jurisdictions. The Tribal Air Rule (TAR) under the CAA 
gives Tribes the opportunity to develop and implement CAA programs such 
as programs to attain and maintain the PM2.5 NAAQS, but it 
leaves to the discretion of the Tribe the decision of whether to 
develop these programs and which programs, or appropriate elements of a 
program, they will adopt.
    Although Executive Order 13175 does not apply to this rule, EPA did 
reach out to Tribal leaders and environmental staff in developing this 
rule. From 2001-2004, the EPA supported a National Designations 
Workgroup to provide a forum for tribal professionals to give input to 
the designations process. In 2006, EPA supported a national ``Tribal 
Air call'' which provides an open forum for all Tribes to voice 
concerns to EPA about the NAAQS implementation process, including the 
PM2.5 NAAQS. In these meetings, EPA briefed call 
participants and Tribal environmental professionals gave input as the 
rule was under development. Furthermore, in December 2005, EPA sent 
individualized letters to all federally recognized Tribes about the 
proposal to give Tribal leaders the opportunity for consultation.
    This final rule does not have Tribal implications as defined by 
Executive Order 13175. It does not have a substantial direct effect on 
one or more Indian Tribes, since no Tribe has implemented a CAA program 
to attain the PM2.5 NAAQS at this time. The EPA notes that 
even if a Tribe were implementing such a plan at this time, while the 
rule might have Tribal implications with respect to that Tribe, it 
would not impose substantial direct costs upon it, nor would it preempt 
Tribal law.
    Furthermore, this rule does not affect the relationship or 
distribution of power and responsibilities between the Federal 
government and Indian Tribes. The CAA and the TAR establish the 
relationship of the Federal government and Tribes in developing plans 
to attain the NAAQS, and this rule does nothing to modify that 
relationship. As this rule does not have Tribal implications, Executive 
Order 13175 does not apply.

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

    EO 13045, ``Protection of Children from Environmental Health and 
Safety Risks,'' (62 FR 19885, April 23, 1997) applies to any rule that 
(1) Is determined to be ``economically significant'' as defined under 
Executive Order 12866, and (2) concerns an environmental health or 
safety risk that EPA has reason to believe may have 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. This final

[[Page 20663]]

rule is subject to EO 13045 because it is economically significant as 
defined in EO 12866, and we believe that the environmental health risk 
addressed by this action may have a disproportionate effect on 
children. This rule implements a previously promulgated health-based 
Federal standard--the PM2.5 NAAQS \56\. The NAAQS constitute 
uniform, national standards for PM pollution; these standards are 
designed to protect public health with an adequate margin of safety, as 
required by CAA section 109. However, the protection offered by these 
standards may be especially important for children because children, 
along with other sensitive population subgroups such as the elderly and 
people with existing heart or lung disease, are potentially susceptible 
to health effects resulting from PM exposure. Because children are 
considered a potentially susceptible population, we have carefully 
evaluated the environmental health effects of exposure to PM pollution 
among children. These effects and the size of the population affected 
are summarized in section 9.2.4 of the Criteria Document and section 
3.5 of the Staff Paper.
---------------------------------------------------------------------------

    \56\ See 62 FR 38652-38760, National Ambient Air Quality 
Standards for Particulate Matter, Final Rule; also 40 CFR part 50.
---------------------------------------------------------------------------

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

    This final rule is not a ``significant energy action'' as defined 
in Executive Order 13211, ``Actions That Significantly Affect Energy 
Supply, Distribution, or Use,'' (66 FR 28355, May 22, 2001) because it 
is not likely to have a significant adverse effect on the supply, 
distribution, or use of energy. This rule is not a ``significant energy 
action,'' because it does not establish requirements that directly 
affect the general public and the public and private sectors, but, 
rather, interprets the statutory requirements that apply to States in 
preparing their SIPs. The SIPs themselves will likely establish 
requirements that directly affect the general public, and the public 
and private sectors.

I. National Technology Transfer Advancement Act

    Section 12(d) of the National Technology Transfer Advancement Act 
of 1995 (``NTTAA''), Public Law No. 104-113, section 12(d) (15 U.S.C. 
272 note) directs EPA to use voluntary consensus standards (VCS) in its 
regulatory activities unless to do so would be inconsistent with 
applicable law or otherwise impractical. Voluntary consensus standards 
are technical standards (e.g., materials specifications, test methods, 
sampling procedures, and business practices) that are developed or 
adopted by VCS bodies. The NTTAA directs EPA to provide Congress, 
through OMB, explanations when the Agency decides not to use available 
and applicable VCS.
    This final rulemaking does not involve technical standards. 
Therefore, EPA is not considering the use of any VCS. The EPA will 
encourage the States and Tribes to consider the use of such standards, 
where appropriate, in the development of their implementation plans.

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

    EO 12898 (59 FR 7629 (Feb. 16, 1994) establishes Federal executive 
policy on environmental justice. Its main provision directs Federal 
agencies, to the greatest extent practicable and permitted by law, to 
make environmental justice part of their mission by identifying and 
addressing, as appropriate, disproportionately high and adverse human 
health or environmental effects of their programs, policies and 
activities on minority populations and low-income populations in the 
United States.
    The EPA has determined that the final rule should not have 
disproportionately high and adverse human health or environmental 
effects on minority or low-income populations because it increases the 
level of environmental protection for all affected populations without 
having any disproportionately high and adverse human health or 
environmental effects on any population, including any minority or low-
income population. The health and environmental risks associated with 
fine particles were considered in the establishment of the 
PM2.5 NAAQS. The level is designed to be protective with an 
adequate margin of safety. This final rule provides a framework for 
improving environmental quality and reducing health risks for areas 
that may be designated nonattainment.

K. Congressional Review Act

    The Congressional Review Act, 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. The EPA will submit a report containing the 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 a ``major rule'' as defined by 5 U.S.C. 
804(2). This rule will be effective June 25, 2007.

L. Petitions for Judicial Review

    Under section 307(b)(1) of the Act, petitions for judicial review 
of this action must be filed in the United States Court of Appeals for 
the District of Columbia Circuit by June 25, 2007. 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 Act section 307(b)(2).

M. Judicial Review

    Under sections 307(d)(1)(E) and 307(d)(1)(V) of the CAA, the 
Administrator determines that this action is subject to the provisions 
of section 307(d). Section 307(d)(1)(V) provides that the provisions of 
section 307(d) apply to ``such other actions as the Administrator may 
determine.'' While the Administrator did not make this determination 
earlier, the Administrator believes that all of the procedural 
requirements, e.g., docketing, hearing and comment periods, of section 
307(d) have been complied with during the course of this rulemaking.

IV. Statutory Authority

    The statutory authority for this action is provided by 42 U.S.C. 
7401, 7408, 7410, 7501-7509a, and 7601(a)(1). This notice is also 
subject to 307(d) of the CAA (42 U.S.C. 7407(d)).

List of Subjects in 40 CFR Part 51

    Administrative practice and procedure, Air pollution control, 
Intergovernmental relations, Nitrogen dioxide, Ozone, Particulate 
matter, Sulfur oxides, Transportation, Volatile organic compound.

    Dated: March 29, 2007.
Stephen L. Johnson,
Administrator.

0
For the reasons set out in the preamble, title 40, chapter I of the 
Code

[[Page 20664]]

of Federal Regulations is amended as follows:
0
1. The authority citation for part 51 continues to read as follows:

    Authority: 23 U.S.C. 101; 42 U.S.C. 7401-7671q.


0
2. A new Subpart Z is added to read as follows:

Subpart Z--Provisions for Implementation of PM2.5 National Ambient 
Air Quality Standards

Sec.
51.1000 Definitions.
51.1001 Applicability of part 51.
51.1002 Submittal of State implementation plan.
51.1003 [Reserved]
51.1004 Attainment dates.
51.1005 One-year extensions of the attainment date.
51.1006 Redesignation to nonattainment following initial 
designations for the PM2.5 NAAQS.
51.1007 Attainment demonstration and modeling requirements.
51.1008 Emission inventory requirements for the PM2.5 
NAAQS.
51.1009 Reasonable further progress (RFP) requirements.
51.1010 Requirements for reasonably available control technology 
(RACT) and reasonably available control measures (RACM).
51.1011 Requirements for mid-course review.
51.1012. Requirements for contingency measures.


Sec.  51.1000  Definitions.

    The following definitions apply for purposes of this subpart. Any 
term not defined herein shall have the meaning as defined in 40 CFR 
51.100.
    Act means the Clean Air Act as codified at 42 U.S.C. 7401-7671q. 
(2003).
    Attainment date means the date by which an area, under an approved 
State implementation plan, is required to attain the PM2.5 
NAAQS (based on the average of three consecutive years of ambient air 
quality data).
    Baseline year inventory for the RFP plan is the emissions inventory 
for the year also used as the base year for the attainment 
demonstration.
    Benchmark RFP plan means the reasonable further progress plan that 
requires generally linear emission reductions in pollutants from the 
baseline emissions year through the milestone inventory year.
    Date of designation means the effective date of the 
PM2.5 area designation as promulgated by the Administrator.
    Direct PM2.5 emissions means solid particles emitted 
directly from an air emissions source or activity, or gaseous emissions 
or liquid droplets from an air emissions source or activity which 
condense to form particulate matter at ambient temperatures. Direct 
PM2.5 emissions include elemental carbon, directly emitted 
organic carbon, directly emitted sulfate, directly emitted nitrate, and 
other inorganic particles (including but not limited to crustal 
material, metals, and sea salt).
    Existing control measure means any Federally enforceable national, 
State, or local control measure that has been approved in the SIP and 
that results in reductions in emissions of PM2.5 or 
PM2.5 precursors in a nonattainment area.
    Full implementation inventory is the projected RFP emission 
inventory for the year preceding the attainment date, representing a 
level of emissions that demonstrates attainment.
    Milestone year inventory is the projected RFP emission inventory 
for the applicable RFP milestone year (i.e. 2009 and, where applicable, 
2012).
    PM2.5 NAAQS means the particulate matter national 
ambient air quality standards (annual and 24-hour) codified at 40 CFR 
50.7.
    PM2.5 design value for a nonattainment area is the 
highest of the three-year average concentrations calculated for the 
monitors in the area, in accordance with 40 CFR part 50, appendix N.
    PM2.5 attainment plan precursor means S02 and 
those other PM2.5 precursors emitted by sources in the State 
which the State must evaluate for emission reduction measures to be 
included in its PM2.5 nonattainment area or maintenance area 
plan.
    PM2.5 precursor means those air pollutants other than 
PM2.5 direct emissions that contribute to the formation of 
PM2.5. PM2.5 precursors include S02, 
NOX, volatile organic compounds, and ammonia.
    Reasonable further progress (RFP) means the incremental emissions 
reductions toward attainment required under sections 172(c)(2) and 
171(1).
    Subpart 1 means the general attainment plan requirements found in 
subpart 1 of part D of title I of the Act.


Sec.  51.1001  Applicability of part 51.

    The provisions in subparts A through X of this part apply to areas 
for purposes of the PM2.5 NAAQS to the extent they are not 
inconsistent with the provisions of this subpart.


Sec.  51.1002  Submittal of State implementation plan.

    (a) For any area designated by EPA as nonattainment for the 
PM2.5 NAAQS, the State must submit a State implementation 
plan satisfying the requirements of section 172 of the Act and this 
subpart to EPA by the date prescribed by EPA which will be no later 
than 3 years from the date of designation.
    (b) The State must submit a plan consistent with the requirements 
of section 110(a)(2) of the Act unless the State already has fulfilled 
this obligation for the purposes of implementing the PM2.5 
NAAQS.
    (c) Pollutants contributing to fine particle concentrations. The 
State implementation plan must identify and evaluate sources of 
PM2.5 direct emissions and PM2.5 attainment plan 
precursors in accordance with Sec. Sec.  51.1009 and 51.1010. After 
January 1, 2011, for purposes of establishing emissions limits under 
51.1009 and 51.1010, States must establish such limits taking into 
consideration the condensable fraction of direct PM2.5 
emissions. Prior to this date, States are not prohibited from 
establishing source emission limits that include the condensable 
fraction of direct PM2.5.
    (1) The State must address sulfur dioxide as a PM2.5 
attainment plan precursor and evaluate sources of SO2 
emissions in the State for control measures.
    (2) The State must address NOX as a PM2.5 
attainment plan precursor and evaluate sources of NOX 
emissions in the State for control measures, unless the State and EPA 
provide an appropriate technical demonstration for a specific area 
showing that NOX emissions from sources in the State do not 
significantly contribute to PM2.5 concentrations in the 
nonattainment area.
    (3) The State is not required to address VOC as a PM2.5 
attainment plan precursor and evaluate sources of VOC emissions in the 
State for control measures, unless:
    (i) the State provides an appropriate technical demonstration for a 
specific area showing that VOC emissions from sources in the State 
significantly contribute to PM2.5 concentrations in the 
nonattainment area, and such demonstration is approved by EPA; or
    (ii) The EPA provides such a technical demonstration.
    (4) The State is not required to address ammonia as a 
PM2.5 attainment plan precursor and evaluate sources of 
ammonia emissions from sources in the State for control measures, 
unless:
    (i) The State provides an appropriate technical demonstration for a 
specific area showing that ammonia emissions from sources in the State 
significantly contribute to PM2.5 concentrations in the

[[Page 20665]]

nonattainment area, and such demonstration is approved by EPA; or
    (ii) The EPA provides such a technical demonstration.
    (5) The State must submit a demonstration to reverse any 
presumption in this rule for a PM2.5 precursor with respect 
to a particular nonattainment area, if the administrative record 
related to development of its SIP shows that the presumption is not 
technically justified for that area.


Sec.  51.1003  [Reserved]


Sec.  51.1004  Attainment dates.

    (a) Consistent with section 172(a)(2)(A) of the Act, the attainment 
date for an area designated nonattainment for the PM2.5 
NAAQS will be the date by which attainment can be achieved as 
expeditiously as practicable, but no more than five years from the date 
of designation. The Administrator may extend the attainment date to the 
extent the Administrator determines appropriate, for a period no 
greater than 10 years from the date of designation, considering the 
severity of nonattainment and the availability and feasibility of 
pollution control measures.
    (b) In the SIP submittal for each of its nonattainment areas, the 
State must submit an attainment demonstration justifying its proposed 
attainment date. For each nonattainment area, the Administrator will 
approve an attainment date at the same time the Administrator approves 
the attainment demonstration for the area, consistent with the 
attainment date timing provision of section 172(a)(2)(A) and paragraph 
(a) of this section.
    (c) Upon a determination by EPA that an area designated 
nonattainment for the PM2.5 NAAQS has attained the standard, 
the requirements for such area to submit attainment demonstrations and 
associated reasonably available control measures, reasonable further 
progress plans, contingency measures, and other planning SIPs related 
to attainment of the PM2.5 NAAQS shall be suspended until 
such time as: the area is redesignated to attainment, at which time the 
requirements no longer apply; or EPA determines that the area has 
violated the PM2.5 NAAQS, at which time the area is again 
required to submit such plans.


Sec.  51.1005  One-year extensions of the attainment date.

    (a) Pursuant to section 172(a)(2)(C)(ii) of the Act, a State with 
an area that fails to attain the PM2.5 NAAQS by its 
attainment date may apply for an initial 1-year attainment date 
extension if the State has complied with all requirements and 
commitments pertaining to the area in the applicable implementation 
plan, and:
    (1) For an area that violates the annual PM2.5 NAAQS as 
of its attainment date, the annual average concentration for the most 
recent year at each monitor is 15.0 [mu]g/m3 or less 
(calculated according to the data analysis requirements in 40 CFR part 
50, appendix N).
    (2) For an area that violates the 24-hour PM2.5 NAAQS as 
of its attainment date, the 98th percentile concentration for the most 
recent year at each monitor is 65 [mu]g/m3 or less 
(calculated according to the data analysis requirements in 40 CFR part 
50, appendix N).
    (b) An area that fails to attain the PM2.5 NAAQS after 
receiving a 1-year attainment date extension may apply for a second 1-
year attainment date extension pursuant to section 172(a)(2)(C)(ii) if 
the State has complied with all requirements and commitments pertaining 
to the area in the applicable implementation plan, and:
    (1) For an area that violates the annual PM2.5 NAAQS as 
of its attainment date, the two-year average of annual average 
concentrations at each monitor, based on the first extension year and 
the previous year, is 15.0 [mu]g/m3 or less (calculated 
according to the data analysis requirements in 40 CFR part 50, appendix 
N).
    (2) For an area that violates the 24-hour PM2.5 NAAQS as 
of its attainment date, the two-year average of annual 98th percentile 
concentrations at each monitor, based on the first extension year and 
the previous year, is 65 [mu]g/m3 or less (calculated 
according to the data analysis requirements in 40 CFR part 50, appendix 
N).


Sec.  51.1006  Redesignation to nonattainment following initial 
designations for the PM2.5 NAAQS.

    Any area that is initially designated ``attainment/unclassifiable'' 
for the PM2.5 NAAQS may be subsequently redesignated to 
nonattainment if ambient air quality data in future years indicate that 
such a redesignation is appropriate. For any such area that is 
redesignated to nonattainment for the PM2.5 NAAQS, any 
absolute, fixed date that is applicable in connection with the 
requirements of this part is extended by a period of time equal to the 
length of time between the effective date of the initial designation 
for the PM2.5 NAAQS and the effective date of redesignation, 
except as otherwise provided in this subpart.


Sec.  51.1007  Attainment demonstration and modeling requirements.

    (a) For any area designated as nonattainment for the 
PM2.5 NAAQS, the State must submit an attainment 
demonstration showing that the area will attain the annual and 24-hour 
standards as expeditiously as practicable. The demonstration must meet 
the requirements of Sec.  51.112 and Appendix W of this part and must 
include inventory data, modeling results, and emission reduction 
analyses on which the State has based its projected attainment date. 
The attainment date justified by the demonstration must be consistent 
with the requirements of Sec.  51.1004(a). The modeled strategies must 
be consistent with requirements in Sec.  51.1009 for RFP and in Sec.  
51.1010 for RACT and RACM. The attainment demonstration and supporting 
air quality modeling should be consistent with EPA's PM2.5 
modeling guidance.
    (b) Required time frame for obtaining emissions reductions. For 
each nonattainment area, the State implementation plan must provide for 
implementation of all control measures needed for attainment as 
expeditiously as practicable, but no later than the beginning of the 
year prior to the attainment date. Consistent with section 172(c)(1) of 
the Act, the plan must provide for implementation of all RACM and RACT 
as expeditiously as practicable. The plan also must include RFP 
milestones in accordance with Sec.  51.1009, and control measures 
needed to meet these milestones, as necessary.


Sec.  51.1008  Emission inventory requirements for the PM2.5 NAAQS.

    (a) For purposes of meeting the emission inventory requirements of 
section 172(c)(3) of the Act for nonattainment areas, the State shall, 
no later than three years after designation:
    (1) Submit to EPA Statewide emission inventories for direct 
PM2.5 emissions and emissions of PM2.5 
precursors. For purposes of defining the data elements for these 
inventories, the PM2.5 and PM2.5 precursor-
relevant data element requirements under subpart A of this part shall 
apply.
    (2) Submit any additional emission inventory information needed to 
support an attainment demonstration and RFP plan ensuring expeditious 
attainment of the annual and 24-hour PM2.5 standards.
    (b) For inventories required for submission under paragraph (a) of 
this section, a baseline emission inventory is required for the 
attainment demonstration required under Sec.  51.1007 and for meeting 
RFP requirements

[[Page 20666]]

under Sec.  51.1009. As determined on the date of designation, the base 
year for this inventory shall be the most recent calendar year for 
which a complete inventory was required to be submitted to EPA pursuant 
to subpart A of this part. The baseline emission inventory for calendar 
year 2002 or other suitable year shall be used for attainment planning 
and RFP plans for areas initially designated nonattainment for the 
PM2.5 NAAQS in 2004-2005.


Sec.  51.1009  Reasonable further progress (RFP) requirements.

    (a) Consistent with section 172(c)(2) of the Act, State 
implementation plans for areas designated nonattainment for the 
PM2.5 NAAQS must demonstrate reasonable further progress as 
provided in Sec.  51.1009(b) through (h).
    (b) If the State submits to EPA an attainment demonstration and 
State implementation plan for an area which demonstrates that it will 
attain the PM NAAQS within five years of the date of designation, the 
State is not required to submit a separate RFP plan. Compliance with 
the emission reduction measures in the attainment demonstration and 
State implementation plan will meet the requirements for achieving 
reasonable further progress for the area.
    (c) For any area for which the State submits to EPA an approvable 
attainment demonstration and State implementation plan that 
demonstrates the area needs an attainment date of more than five years 
from the date of designation, the State also must submit an RFP plan. 
The RFP plan must describe the control measures that provide for 
meeting the reasonable further progress milestones for the area, the 
timing of implementation of those measures, and the expected reductions 
in emissions of direct PM2.5 and PM2.5 attainment 
plan precursors. The RFP plan is due to EPA within three years of the 
date of designation.
    (1) For any State that submits to EPA an approvable attainment 
demonstration and State implementation plan justifying an attainment 
date of more than five and less than nine years from the date of 
designation, the RFP plan must include 2009 emissions milestones for 
direct PM2.5 and PM2.5 attainment plan precursors 
demonstrating that reasonable further progress will be achieved for the 
2009 emissions year.
    (2) For any area that submits to EPA an approvable attainment 
demonstration and State implementation plan justifying an attainment 
date of nine or ten years from the date of designation, the RFP plan 
must include 2009 and 2012 emissions milestones for direct 
PM2.5 and PM2.5 attainment plan precursors 
demonstrating that reasonable further progress will be achieved for the 
2009 and 2012 emissions years.
    (d) The RFP plan must demonstrate that in each applicable milestone 
year, emissions will be at a level consistent with generally linear 
progress in reducing emissions between the base year and the attainment 
year.
    (e) For a multi-State nonattainment area, the RFP plans for each 
State represented in the nonattainment area must demonstrate RFP on the 
basis of common multi-State inventories. The States within which the 
area is located must provide a coordinated RFP plan. Each State in a 
multi-State nonattainment area must ensure that the sources within its 
boundaries comply with enforceable emission levels and other 
requirements that in combination with the reductions planned in other 
state(s) will provide for attainment as expeditiously as practicable 
and demonstrate reasonable further progress.
    (f) In the benchmark RFP plan, the State must identify direct 
PM2.5 emissions and PM2.5 attainment plan 
precursors regulated under the PM2.5 attainment plan and 
specify target emission reduction levels to be achieved during the 
milestone years. In developing the benchmark RFP plan, the State must 
develop emission inventory information for the geographic area included 
in the plan and conduct the following calculations:
    (1) For direct PM2.5 emissions and each PM2.5 
attainment plan precursor addressed in the attainment strategy, the 
full implementation reduction is calculated by subtracting the full 
implementation inventory from the baseline year inventory.
    (2) The ``milestone date fraction'' is the ratio of the number of 
years from the baseline year to the milestone inventory year divided by 
the number of years from the baseline year to the full implementation 
year.
    (3) For direct PM2.5 emissions and each PM2.5 
attainment plan precursor addressed in the attainment strategy, a 
benchmark emission reduction is calculated by multiplying the full 
implementation reduction by the milestone date fraction.
    (4) The benchmark emission level in the milestone year is 
calculated for direct PM2.5 emissions and each 
PM2.5 attainment plan precursor by subtracting the benchmark 
emission reduction from the baseline year emission level. The benchmark 
RFP plan is defined as a plan that achieves benchmark emission levels 
for direct PM2.5 emissions and each PM2.5 
attainment plan precursor addressed in the attainment strategy for the 
area.
    (5) In comparing inventories between baseline and future years for 
direct PM2.5 emissions and each PM2.5 attainment 
plan precursor, the inventories must be derived from the same 
geographic area. The plan must include emissions estimates for all 
types of emitting sources and activities in the geographic area from 
which the emission inventories for direct PM2.5 emissions 
and each PM2.5 attainment plan precursor addressed in the 
plan are derived.
    (6) For purposes of establishing motor vehicle emissions budgets 
for transportation conformity purposes (as required in 40 CFR part 93) 
for a PM2.5 nonattainment area, the State shall include in 
its RFP submittal an inventory of on-road mobile source emissions in 
the nonattainment area.
    (g) The RFP plan due three years after designation must demonstrate 
that emissions for the milestone year are either:
    (1) At levels that are roughly equivalent to the benchmark emission 
levels for direct PM2.5 emissions and each PM2.5 
attainment plan precursor to be addressed in the plan; or
    (2) At levels included in an alternative scenario that is projected 
to result in a generally equivalent improvement in air quality by the 
milestone year as would be achieved under the benchmark RFP plan.
    (h) The equivalence of an alternative scenario to the corresponding 
benchmark plan must be determined by comparing the expected air quality 
changes of the two scenarios at the design value monitor location. This 
comparison must use the information developed for the attainment plan 
to assess the relationship between emissions reductions of the direct 
PM2.5 emissions and each PM2.5 attainment plan 
precursor addressed in the attainment strategy and the ambient air 
quality improvement for the associated ambient species.


Sec.  51.1010  Requirements for reasonably available control technology 
(RACT) and reasonably available control measures (RACM).

    (a) For each PM2.5 nonattainment area, the State shall 
submit with the attainment demonstration a SIP revision demonstrating 
that it has adopted all reasonably available control measures 
(including RACT for stationary sources) necessary to demonstrate 
attainment as expeditiously as practicable and to meet any RFP 
requirements. The SIP revision shall contain the list of the potential 
measures considered by the State, and

[[Page 20667]]

information and analysis sufficient to support the State's judgment 
that it has adopted all RACM, including RACT.
    (b) In determining whether a particular emission reduction measure 
or set of measures must be adopted as RACM under section 172(c)(1) of 
the Act, the State must consider the cumulative impact of implementing 
the available measures. Potential measures that are reasonably 
available considering technical and economic feasibility must be 
adopted as RACM if, considered collectively, they would advance the 
attainment date by one year or more.


Sec.  51.1011  Requirements for mid-course review.

    (a) Any State that submits to EPA an approvable attainment plan for 
a PM2.5 nonattainment area justifying an attainment date of 
nine or ten years from the date of designation also must submit to EPA 
a mid-course review six years from the date of designation.
    (b) The mid-course review for an area must include:
    (1) A review of emissions reductions and progress made in 
implementing control measures to reduce emissions of direct 
PM2.5 and PM2.5 attainment plan precursors 
contributing to PM2.5 concentrations in the area;
    (2) An analysis of changes in ambient air quality data for the 
area;
    (3) Revised air quality modeling analysis to demonstrate 
attainment;
    (4) Any new or revised control measures adopted by the State, as 
necessary to ensure attainment by the attainment date in the approved 
SIP of the nonattainment area.


Sec.  51.1012  Requirement for contingency measures.

    Consistent with section 172(c)(9) of the Act, the State must submit 
in each attainment plan specific contingency measures to be undertaken 
if the area fails to make reasonable further progress, or fails to 
attain the PM2.5 NAAQS by its attainment date. The 
contingency measures must take effect without significant further 
action by the State or EPA.

 [FR Doc. E7-6347 Filed 4-24-07; 8:45 am]
BILLING CODE 6560-50-P