[Federal Register Volume 73, Number 6 (Wednesday, January 9, 2008)]
[Proposed Rules]
[Pages 1570-1576]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-186]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R05-OAR-2007-1043; FRL-8514-4]


Approval and Promulgation of Air Quality Implementation Plans; 
Michigan; PSD Regulations

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to conditionally approve revisions to 
Michigan's State Implementation plan (SIP) to add the prevention of 
significant deterioration (PSD) construction permit program under the 
Federal Clean Air Act (CAA). This program affects major stationary 
sources in Michigan that are subject to or potentially subject to the 
PSD construction permit program.

DATES: Comments must be received on or before February 8, 2008.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R05-

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OAR-2007-1043, by one of the following methods:
     www.regulations.gov: Follow the on-line instructions for 
submitting comments.
     E-mail: [email protected]. 
     Fax: (312) 886-5824.
     Mail: Pamela Blakley, Chief, Air Permits Section, Air 
Programs Branch (AR-18J), U.S. Environmental Protection Agency, 77 West 
Jackson Boulevard, Chicago, Illinois 60604.
     Hand Delivery: Pamela Blakley, Chief, Air Permits Section, 
Air Programs Branch (AR-18J), U.S. Environmental Protection Agency, 77 
West Jackson Boulevard, Chicago, Illinois 60604. Such deliveries are 
only accepted during the Regional Office normal hours of operation, and 
special arrangements should be made for deliveries of boxed 
information. The Regional Office official hours of business are Monday 
through Friday, 8:30 a.m. to 4:30 p.m. excluding Federal holidays.
    Instructions: Direct your comments to Docket ID No. EPA-R05-OAR-
2007-1043. EPA's policy is that all comments received will be included 
in the public docket without change and may be made available online at 
www.regulations.gov, including any personal information provided, 
unless the comment includes information claimed to be Confidential 
Business Information (CBI) or other information whose disclosure is 
restricted by statute. Do not submit information that you consider to 
be CBI or otherwise protected through www.regulations.gov or e-mail. 
The www.regulations.gov Web site is an ``anonymous access'' system, 
which means EPA will not know your identity or contact information 
unless you provide it in the body of your comment. If you send an e-
mail comment directly to EPA without going through www.regulations.gov 
your e-mail address will be automatically captured and included as part 
of the comment that is placed in the public docket and made available 
on the Internet. If you submit an electronic comment, EPA recommends 
that you include your name and other contact information in the body of 
your comment and with any disk or CD-ROM you submit. If EPA cannot read 
your comment due to technical difficulties and cannot contact you for 
clarification, EPA may not be able to consider your comment. Electronic 
files should avoid the use of special characters, any form of 
encryption, and be free of any defects or viruses. For additional 
instructions on submitting comments, go to Section I of the 
SUPPLEMENTARY INFORMATION section of this document.
    Docket: All documents in the docket are listed in the 
www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hard copy.
    Publicly available docket materials are available either 
electronically in www.regulations.gov or in hard copy at the 
Environmental Protection Agency, Region 5, Air and Radiation Division, 
77 West Jackson Boulevard, Chicago, Illinois 60604. This Facility is 
open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding 
legal holidays. We recommend that you telephone Laura Cossa, 
Environmental Engineer, at (312) 886-0661 before visiting the Region 5 
office.

FOR FURTHER INFORMATION CONTACT: Laura Cossa, Environmental Engineer, 
Air Permits Section, Air Programs Branch (AR-18J), U.S. Environmental 
Protection Agency, Region 5, 77 West Jackson Boulevard, Chicago, 
Illinois 60604, (312) 886-0661, [email protected].

SUPPLEMENTARY INFORMATION: Throughout this document whenever ``we,'' 
``us,'' or ``our'' is used, we mean EPA. This supplementary information 
section is arranged as follows:

I. What Should I Consider as I Prepare My Comments for EPA?
II. What Is Being Addressed in This Document?
III. What Are the Changes That EPA Is Conditionally Approving?
IV. What Action Is EPA Taking Today?
V. Statutory and Executive Order Reviews

I. What Should I Consider as I Prepare My Comments for EPA?

    1. Identify the rulemaking by docket number and other identifying 
information (subject heading, Federal Register date and page number).
    2. Follow directions--The EPA may ask you to respond to specific 
questions or organize comments by referencing a Code of Federal 
Regulations (CFR) part or section number.
    3. Explain why you agree or disagree; suggest alternatives and 
substitute language for your requested changes.
    4. Describe any assumptions and provide any technical information 
and/or data that you used.
    5. If you estimate potential costs or burdens, explain how you 
arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
    6. Provide specific examples to illustrate your concerns, and 
suggest alternatives.
    7. Explain your views as clearly as possible, avoiding the use of 
profanity or personal threats.
    8. Make sure to submit your comments by the comment period deadline 
identified.

II. What Is Being Addressed in This Document?

    EPA is proposing to conditionally approve revisions to Michigan's 
SIP to add the PSD construction permit program. Approval of the 
proposed state rules would allow Michigan to obtain a full CAA New 
Source Review (NSR) SIP. Current state SIP rules implement the major 
NSR permitting program for sources located in counties not attaining 
air quality standards, but not the PSD permitting program for sources 
located in counties attaining air quality standards. Prior to 
Michigan's development of the submitted PSD program, EPA delegated to 
Michigan the authority to issue PSD permits through the Federal PSD 
rules at 40 CFR 52.21 (via delegation letter dated September 26, 1988).
    The new state PSD rules reflect the requirements of CAA 42 Sections 
110(a)(2)(c) and 165. The state PSD rules also reflect recent changes 
to 40 CFR 51.166, following the June 24, 2005, United States Court of 
Appeals for the District of Columbia Circuit ruling on the Federal PSD 
and non-attainment NSR regulation revisions. These revisions are 
commonly referred to as ``NSR Reform'' regulations, and became 
effective on March 3, 2003. Michigan adopted the PSD rules on December 
4, 2006. The rules took effect immediately at the state level. The 
Michigan Department of Environmental Quality (MDEQ) submitted to EPA a 
final request for approval of these rules into the SIP on December 21, 
2006. On February 12, 2007, EPA notified the state that the submittal 
satisfied the completeness criteria set forth at 40 CFR 51, Appendix V.

III. What Are the Changes That EPA Is Conditionally Approving?

Michigan Air Pollution Control Rules, Part 18, Prevention of 
Significant Deterioration of Air Quality, Rules R 336.2801 to R 
336.2819 and R 336.2823 (1) to (14).

    The following subsections discuss the elements of the proposed 
state rules and how they compare to Federal requirements:
R 336.2801 Definitions
    Actual Emissions
    Michigan has established the definition of ``actual emissions'' in 
R

[[Page 1572]]

336.2801(a). This definition is consistent with the definition in 40 
CFR 51.166(b)(21).
    Baseline Actual Emissions
    Michigan has established the definition of ``baseline actual 
emissions'' in R 336.2801 (b). This definition is consistent with the 
definition in 40 CFR 51.166(b)(47).
    Baseline Area
    Michigan has established the definition of ``baseline area'' in R 
336.2801(c). The definition is consistent with the definition in 40 CFR 
51.166(b)(15). The reference to nonattainment area regulations in state 
rule R 336.2801(c)(ii)(b) is irrelevant for the purposes of this PSD 
SIP submittal.
    Baseline Concentration
    Michigan has established the definition of ``baseline 
concentration'' in R 336.2801(d). This definition is consistent with 
the definition in 40 CFR 51.166(b)(13).
    Begin Actual Construction
    Michigan has established the definition of ``begin actual 
construction'' in R 336.2801 (e). This definition is consistent with 
the definition in 40 CFR 51.166(b)(11).
    Best Available Control Technology or ``BACT''
    Michigan has established the definition of ``BACT'' in R 
336.2801(f). This definition is consistent with the definition in 40 
CFR 51.166(b)(12).
    Building, Structure, Facility, or Installation
    Michigan has established the definition of ``building, structure, 
facility, or installation''--in R 336.2801 (g). This definition is 
consistent with the definition in 40 CFR 51.166(b)(6).
    Clean Coal Technology 
    Michigan has established the definition of ``clean coal 
technology'' in R 336.2801 (h). This definition is consistent with the 
definition in 40 CFR 51.166(b)(33).
    Clean Coal Technology Demonstration Project
    Michigan has established the definition of ``clean coal technology 
demonstration project'' in R 336.2801(i). This definition is consistent 
with the definition in 40 CFR 51.166(b)(34).
    Commence 
    Michigan has established the definition of ``commence'' in R 
336.2801(k). This definition is consistent with the definition in 40 
CFR 51.166(b)(9).
    Complete 
    Michigan has established the definition of ``complete''--in 
reference to an application to a permit--in R 336.2801(l). This 
definition is consistent with the definition in 40 CFR 51.166(b)(22).
    Construction 
    Michigan has established the definition of ``construction'' in R 
336.2801(m). This definition is consistent with the definition in 40 
CFR 51.166(b)(8).
    Continuous Emissions Monitoring System or ``CEMS'' 
    Michigan has established the definition of ``CEMS'' in R 
336.2801(n). This definition is consistent with the definition in 40 
CFR 51.166(b)(43).
    Continuous Emissions Rate Monitoring System or ``CERMS'' 
    Michigan has established the definition of ``CERMS'' in R 
336.2801(o). This definition is consistent with the definition in 40 
CFR 51.166(b)(46).
    Continuous Parameter Monitoring System or ``CPMS'' 
    Michigan has established the definition of ``CPMS'' in R 
336.2801(p). This definition is consistent with the definition in 40 
CFR 51.166(b)(45).
    Electric Utility Steam Generating Unit
    Michigan has established the definition of ``electric utility steam 
generating unit'' in R 336.2801(q). This definition is consistent with 
the definition in 40 CFR 51.166(b)(30).
    Emissions Unit 
    Michigan has established the definition of ``emissions unit'' in R 
336.2801(r). This is consistent with the definition in 40 CFR 
51.166(b)(7). Included in both the Federal and state definitions is the 
statement that a replacement unit is considered an existing unit under 
this definition. However, Michigan's rules do not define ``replacement 
unit,'' which is included in the Federal rule at 40 CFR 51.166(b)(7). 
In a letter sent to EPA on May 17, 2007, Michigan agreed to follow the 
Federal definition of ``replacement unit'' in its implementation of 
these rules, and committed to add the definition in a future 
rulemaking. In a subsequent letter to EPA, dated November 30, 2007, 
MDEQ committed to add this definition in the rules not later than one 
year after EPA's conditional approval of this plan. Based on this 
commitment, and the understanding that Michigan will follow the Federal 
definition of ``replacement unit'' in its implementation of the rules 
in the interim, EPA is proposing to conditionally approve this rule.
    Federal Land Manager 
    Michigan has established the definition of ``federal land manager'' 
in R 336.2801(s). This definition is consistent with the definition in 
40 CFR 51.166(b)(24).
    High Terrain 
    Michigan has established the definition of ``high terrain'' in R 
336.2801(t). This definition is consistent with the definition in 40 
CFR 51.166(b)(25).
    Hydrocarbon Combustion Flare 
    Michigan has established the definition of ``hydrocarbon combustion 
flare'' in R 336.2801(u). This definition is consistent with the 
definition in 40 CFR 51.166(b)(31)(iv).
    Indian Reservation 
    Michigan has established the definition of ``Indian reservation'' 
in R 336.2801(v). This definition is consistent with the definition in 
40 CFR 51.166(b)(27).
    Indian Governing Body 
    Michigan has established the definition of ``Indian governing 
body'' in R 336.2801(w). This definition is consistent with the 
definition in 40 CFR 51.166(b)(28).
    Innovative Control Technology 
    Michigan has established the definition of ``innovative control 
technology'' in R 336.2801(x). This definition is consistent with the 
definition in 40 CFR 51.166(b)(19).
    Low Terrain
    Michigan has established the definition of ``low terrain'' in R 
336.2801(y). This definition is consistent with the definition in 40 
CFR 51.166(b)(26).
    ``Lowest Achievable Emission Rate'' or ``LAER'' 
    Michigan has established the definition of ``LAER'' in R 
336.2801(z). This definition is consistent with the definition in 40 
CFR 51.166(b)(52).
    Major Modification 
    Michigan has established the definition of ``major modification'' 
in R 336.2801(aa). This definition is consistent with the definition in 
40 CFR 51.166(b)(2).
    Major and Minor Source Baseline Date 
    Michigan has established the definition of ``major source baseline 
date'' and ``minor source baseline date'' in R 336.2801(bb). This 
definition is consistent with the definition in 40 CFR 51.166(b)(14).
    Major Stationary Source 
    Michigan has established the definition of ``major stationary 
source'' in R 336.2801(cc). This definition is consistent with the 
definition in 40 CFR 51.166(b)(1).
    Necessary Preconstruction Approvals or Permits 
    Michigan has established the definition of ``necessary 
preconstruction approvals or permits'' in R 336.2801(dd). This 
definition is consistent with the definition in 40 CFR 51.166(b)(10).
    Net Emissions Increase 
    Michigan has established the definition of ``net emissions 
increase'' in

[[Page 1573]]

R 336.2801(ee). This definition exceeds the requirements of 40 CFR 
51.166(b)(3). As described in 40 CFR 51.166(b), states can use 
definitions that are more stringent than the corresponding definitions 
listed in 40 CFR 51.166(b)(1) to (56). However, in a letter dated May 
17, 2007, Michigan declined intent for a more stringent definition, and 
stated that the definition of ``net emissions increase'' is being 
rewritten under a state rulemaking, so that it will follow the same 
requirements as the Federal rule. Michigan indicates that the 
definition of ``net emissions increase'' as currently set forth in R 
336.2801(ee) will be applied until the state rules are revised. EPA 
finds that the rule is approvable as currently promulgated, and as 
proposed to be revised to match the Federal definition. Therefore we 
propose to approve the definition of ``net emissions increase'' as part 
of the SIP.
    Pollution Prevention 
    Michigan has established the definition of ``pollution prevention'' 
in R 336.2801(gg). This definition is consistent with the definition in 
40 CFR 51.166(b)(38).
    Potential to Emit or ``PTE'' 
    ``Michigan has established the definition of ``PTE'' in R 
336.2801(hh). This definition is consistent with the definition in 40 
CFR 51.166(b)(4), except instead of ``federally enforceable,'' vacated 
in Chemical Manufacturers Assn v. EPA, No. 89-1514 (D.C. Cir. Sept. 15, 
1995) the Michigan rules use the more general term ``legally 
enforceable.'' See EPA Interim Policy on Federally Enforceable 
Requirement for Limitations on PTE, dated January 22, 1996 (``Interim 
Policy''). EPA proposes to find the use of the term ``legally 
enforceable'' approvable as part of the definition of ``PTE'' because 
Michigan agrees to apply the term ``legally enforceable'' in accordance 
with the Interim Policy to mean legally and practically enforceable by 
a state or local air pollution control agency, as well as by the EPA. 
In general, practicable enforceability for a source-specific permit 
means that the permit's provisions must specify: (1) A technically-
accurate limitation and the portions of the source subject to the 
limitation; (2) the time period for the limitation (hourly, daily, 
monthly, and annual limits such as rolling annual limits); and (3) the 
method to determine compliance including appropriate monitoring, 
recordkeeping, and reporting. For rules and general permits that apply 
to categories of sources, practicable enforceability additionally 
requires that the provisions: (1) Identify the types or categories of 
sources that are covered by the rule; (2) where coverage is optional, 
provide for notice to the permitting authority of the source's election 
to be covered by the rule; and (3) specify the enforcement consequences 
relevant to the rule.
    Michigan has committed in a letter dated September 11, 2007, to 
apply the term ``legally enforceable'' consistent with the above, and 
to revise the rule to make it consistent with this understanding. In a 
subsequent letter to EPA, dated November 30, 2007, MDEQ committed to 
add this definition in the rules not later than one year after EPA's 
conditional approval of this plan. Therefore EPA is proposing to 
conditionally approve this rule.
    Predictive Emissions Monitoring System or ``PEMS'' 
    Michigan has established the definition of ``PEMS'' in R 
336.2801(ii). This definition is consistent with the definition in 40 
CFR 51.166(b)(44).
    Prevention of Significant Deterioration Program or ``PSD''
    Michigan has established the definition of ``PSD'' in R 
336.2801(jj). This definition is consistent with the definition in 40 
CFR 51.166(b)(42).
    Project 
    Michigan has established the definition of ``project'' in R 
336.2801(kk). This definition is consistent with the definition in 40 
CFR 51.166(b)(51).
    Projected Actual Emissions 
    Michigan has established the definition of ``projected actual 
emissions'' in R 336.2801(ll). This definition is consistent with the 
definition in 40 CFR 51.166(b)(40).
    Reactivation of a Very Clean Coal-Fired Electric Utility Steam 
Generating Unit 
    Michigan has established the definition of ``reactivation of a very 
clean coal-fired electric utility steam generating unit'' in R 336.2801 
(mm). This definition is consistent with the definition in 40 CFR 
51.166(b)(37).
    Regulated New Source Review Pollutant 
    Michigan has established the definition of ``regulated new source 
review pollutant'' in R 336.2801(nn). This definition is consistent 
with the definition in 40 CFR 51.166(b)(49).
    Repowering 
    Michigan has established the definition of ``repowering'' in R 
336.2801(oo). This definition is consistent with the definition in 40 
CFR 51.166(b)(36).
    Secondary Emissions 
    Michigan has established the definition of ``secondary emissions'' 
in R 336.2801(pp). This definition is consistent with the definition in 
40 CFR 51.166(b)(18).
    Significant 
    Michigan has established the definition of ``significant'' in R 
336.2801(qq). This definition is consistent with the definition in 40 
CFR 51.166(b)(23).
    Significant Emissions Increase 
    Michigan has established the definition of ``significant emissions 
increase'' in R 336.2801(rr). This definition is consistent with the 
definition in 40 CFR 51.166(b)(39).
    Stationary source 
    Michigan has established the definition of ``stationary source'' in 
R 336.2801(ss). This definition is consistent with the definition in 40 
CFR 51.166(b)(5).
    Temporary Clean Coal Technology Demonstration Project 
    Michigan has established the definition of ``temporary clean coal 
technology demonstration project'' in R 336.2801(tt). This definition 
is consistent with the definition in 40 CFR 51.166(b)(35).
    Definitions Not Included in the PSD SIP 
    The following 40 CFR 51.166(b) definitions are not included in the 
submitted SIP rules: ``allowable emissions'', ``federally 
enforceable'', and ``fugitive emissions''. The definitions of 
``allowable emissions'' and ``fugitive emissions'' are included in 
previously approved SIP programs in Michigan's air rules (R 336.1101(j) 
and R 336.1106(h)), and are consistent with the definitions in 40 CFR 
51.166(b)(16) and 40 CFR 51.166(b)(20). EPA is proposing to approve the 
rules based on Michigan's commitment that, in its implementation of the 
PSD rules, the State will follow the definitions of ``allowable 
emissions'' and ``fugitive emissions'' as included in previously 
approved SIP programs in Michigan's air rules (R 336.1101(j) and R 
336.1106(h)), and as consistent with the definitions in 40 CFR 
51.166(b)(16) and 40 CFR 51.166(b)(20).
    The definition of ``federally enforceable'' is not required for the 
PSD SIP. See discussion above in conjunction with the definition of 
``PTE.'' Instead of ``federally enforceable,'' the Michigan rules use 
the term ``legally enforceable.'' Consistent with the Interim Policy, 
EPA proposes to find the term ``legally enforceable'' conditionally 
approvable as part of the rules' definition of ``PTE'' (R 336.2801(hh)) 
as long as Michigan agrees to apply the term ``legally enforceable'' in 
accordance with the Interim Policy to mean legally and practically 
enforceable by the EPA, a state or local air pollution control 
agency,'' as discussed above.

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R 336.2802 Applicability
    The Michigan rule defines the applicability of the PSD permitting 
program. The rule states that new major sources or major modifications 
at existing major sources of air pollution must obtain a PSD permit 
before construction begins. The rule also states that major 
modifications occur when a project causes a significant increase in an 
air pollutant. The rule then goes on to provide four methods of 
determining whether a significant increase occurs: (1) Baseline actual 
emissions v. future potential emissions (applies to new or existing 
sources); (2) baseline actual emissions v. projected actual emissions 
(applies to existing sources only); (3) hybrid combination (for 
projects involving new and existing sources); and (4) Plantwide 
Applicability Limitations. Rule R 336.2802 is consistent with 40 CFR 
51.166(a)(7).
R 336.2803 Ambient Air Increments
    This rule contains the ambient air increment requirements 
(acceptable maximum impacts that may be caused by a new source of air 
pollution). Rule R 336.2803 is consistent with 40 CFR 51.166(c).
R 336.2804 Ambient Air Ceilings
    This rule sets forth ambient air increment requirements to ensure 
that no source may cause the concentration of air pollutants in the 
ambient air to exceed the National Ambient Air Quality Standards 
(NAAQS). Rule R 336.2804 is consistent with 40 CFR 51.166(d).
R 336.2805 Restrictions on Area Classifications
    This rule contains the ambient air ceiling requirements for certain 
Class I areas (such as national parks and national wildlife areas). All 
other areas of the state are Class II areas. The Federal and state PSD 
rules allow greater impacts from air pollutants in Class III areas, but 
Michigan does not currently contain any Class III areas. If Michigan 
were to seek to establish any Class III areas, then this rule would 
need to be consistent with Class III requirements at that time. Rule R 
336.2805 is consistent with 40 CFR 51.166(e).
R 336.2806 Exclusions From Increment Consumption
    This rule specifies concentrations which shall be excluded from 
determining compliance with maximum allowable increments. Rule R 
336.2806 is consistent with 40 CFR 51.166(f).
R 336.2807 Redesignation
    This rule contains provisions for obtaining waivers from normal 
increment consumption requirements. Rule R 336.2807 is consistent with 
40 CFR 51.166(g).
R 336.2808 Stack Heights
    This rule contains stack heights requirements. Rule R 336.2808 is 
consistent with 40 CFR 51.166(h).
R 336.2809 Exemptions
    This rule exempts certain sources from applicable technology 
review, air quality monitoring, and projected emission impact modeling 
requirements. Rule R 336.2809 is consistent with 40 CFR 51.166(i).
R 336.2810 Control Technology Review
    This rule requires permit applicants to include the BACT on 
proposed new major sources or major modifications at existing major 
sources. Rule R 336.2810 is consistent with 40 CFR 51.166(j).
R 336.2811 Source Impact Analysis
    This rule requires permit applicants to demonstrate that their 
proposed emissions will not cause a violation of the NAAQS or the air 
quality increment. Rule R 336.2811 is consistent with 40 CFR 51.166(k).
R 336.2812 Air Quality Models
    This rule provides requirements for acceptable computer models 
which may be used in an air quality impact demonstration. Rule R 
336.2812 is consistent with 40 CFR 51.166(l).
R 336.2813 Air Quality Analysis
    This rule requires that a PSD permit applicant analyze the existing 
condition of the ambient air at the proposed site both before and after 
construction (sometimes referred to as preconstruction and post-
construction monitoring). Rule R 336.2813 is consistent with 40 CFR 
51.166(m).
R 336.2814 Source Information
    This rule contains minimum information content requirements for PSD 
permit applications. Rule R 336.2814 is consistent with 40 CFR 
51.166(n).
R 336.2815 Additional Impact Analyses
    This rule requires that the PSD permit applicant evaluate 
additional environmental impacts, like the impairment of visibility, 
soils, or vegetation. Rule R 336.2815 is consistent with 40 CFR 
51.166(o).
R 336.2816 Sources Impacting Federal Class I Areas; Additional 
Requirements
    This rule establishes alternative increment requirements for 
sources impacting Class I areas. Rule R 336.2816, as submitted, is not 
consistent with 40 CFR 51.166(p). Specifically, state rule R 
332.2816(2)(a) does not include the requirements of 51.166(p)(3), under 
which a plan must provide a mechanism whereby the Federal Land Manager 
may present to the state a demonstration of impacts of air quality-
related values from proposed source/modification where maximum 
allowable increases for a Class I area are not violated, in which case 
if the state concurs, the state does not issue a permit. In a letter to 
EPA dated November 30, 2007, MDEQ committed to include these 
requirements in a future rule-making revision, to be completed no later 
than one year after EPA's conditional approval. Additionally, the state 
committed to clarify Rules R 332.2816 to more closely comport with 40 
CFR 51.166(p). The proposed language, included in the November 30, 
2007, letter is acceptable. Therefore EPA is proposing to conditionally 
approve this rule.
R 336.2817 Public Participation
    This rule establishes the minimum acceptable opportunities for 
public comment on a proposed PSD permit. In its rules, Michigan is 
foregoing the right to one full year to act on a complete permit 
application, and is bound, instead, under the rules to act within 120 
days. We approve this change. Rule R 336.2817 is consistent with 40 CFR 
51.166(q).
R 336.2818 Source Obligation
    This rule places additional requirements upon the PSD permit 
applicant, including recordkeeping requirements for applicants using 
certain methods for determining if a project results in a significant 
increase.
    On December 31, 2002, EPA published revisions to the Federal PSD 
and non-attainment NSR regulations. These revisions are commonly 
referred to as ``NSR Reform'' regulations and became effective on March 
3, 2003. These regulatory revisions include provisions for baseline 
emissions determinations, actual-to-future actual methodology, 
Plantwide Applicability Limits (PALs), Clean Units, and Pollution 
Control Projects (PCP). The Federal rules require a source to follow 
the recordkeeping and reporting requirements in this section if there 
is a ``reasonable possibility'' that a source may exceed the projected 
actual

[[Page 1575]]

emissions (40 CFR 51.166(r)(6)). The ``reasonable possibility'' clause 
of this provision of the Federal rule has been remanded to EPA in the 
June 24, 2005, D.C. Circuit Court ruling in State of New York et al. v. 
EPA, 413 F.3d 3 (D.C. Cir. 2005). On December 14, 2007, EPA issued a 
final rule that provides additional explanation and more detailed 
criteria to clarify the ''reasonable possibility'' recordkeeping and 
reporting standard of the 2002 NSR reform rules. This final action will 
require recordkeeping and reporting when the projected increase in 
emissions to which the ``reasonable possibility'' test applies equals 
or exceeds 50 percent of the CAA's NSR significance levels for any 
pollutant.\1\ MDEQ must submit a notice to EPA within 1 year from this 
conditional approval--before EPA takes final action to approve this 
aspect of the SIP--to acknowledge the rule change and that the PSD 
regulations will continue to follow the ``reasonable possibility'' 
provisions in a manner that is consistent with EPA's final rule. All 
the requirements of rule R 336.2818 are consistent with 40 CFR 
51.166(r).
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    \1\ Currently, the MDEQ's minor source permitting program--Rule 
R 336.1201--requires this information to be submitted for all 
sources as part of a complete Permit to Install application before 
beginning actual construction on the proposed project (not just 
where there is a ``reasonable possibility'' that the source may 
exceed the projected actual emissions). Because this is more 
stringent than the Federal requirement, we approve this approach.
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R 336.2819 Innovative Control Technology
    This rule contains provisions allowing a PSD permit applicant to 
experiment with new control technologies to satisfy the BACT 
requirement. Rule R 336.2819 is consistent with 40 CFR 51.166(s).
R 336.2823 (1) to (14) Actuals Plantwide Applicability Limits (PALs)
    This rule contains an alternate applicability method for 
determining if a source requires a PSD permit. Rule R 336.2823(1) to 
(14) is consistent with 40 CFR 51.166(w).
Rules Not Included in the PSD SIP
    Subrule R 336.1823(15) contains provisions synchronizing the 
Michigan minor permit to install program with the new PAL provisions. 
This subrule is mainly concerned with state air toxics provisions and 
was not submitted as part of Michigan's PSD SIP. Therefore, EPA is not 
taking action on rule R 336.1823(15) as part of this rulemaking action.
    Rule R 336.2830 is intended to provide a parallel appeal procedure 
to the procedure that is currently in place for the Federal PSD program 
in Michigan under the regulation at 40 CFR 124. The rule creates a 
right to an administrative hearing before a state administrative law 
judge that is similar to the current appeal rights under the Federal 
PSD permitting program. This rule is not submitted as part of 
Michigan's PSD SIP. Therefore, EPA is not taking action on rule R 
336.2830.

IV. What Action Is EPA Taking Today?

    EPA is proposing to conditionally approve revisions to the SIP to 
include the PSD construction permit programs of the State of Michigan.

Conditions for Conditional Approval

    As noted above, EPA has identified several minor deficiencies that 
are necessary to correct in Michigan's rules so that the rules are 
approvable. The areas of concern are discussed in more detail above. In 
a letter to EPA dated May 17, 2007, Michigan committed to follow the 
federal definition of ``replacement unit'' (40 CFR 51.166(b)(7)) in its 
implementation of these rules, and to add the definition to the state 
rules in a future rulemaking. For the definition of ``PTE'' (Rule 
336.2801(hh)), Michigan follows the federal definition, except instead 
of ``federally enforceable'', the Michigan rules use the more general 
term ``legally enforceable''. Michigan has committed, in a letter to 
EPA dated September 11, 2007, to apply the term legally enforceable to 
mean legally and practically enforceable by the EPA, a state or local 
air pollution agency, consistent with the Interim Policy dated January 
22, 1996.
    The state's current Rule 336.2816 does not include a mechanism 
under which the Federal Land Manager may present to the state a 
demonstration of impacts of air quality-related values from proposed 
source/modification where maximum allowable increases for a Class I 
area are not violated, and if the state concurs it does not issue the 
permit (as per 40 CFR 51.166(p) (3)). In order to add the missing 
requirement for sources impacting federal Class I areas, MDEQ 
committed, in a letter to EPA dated November 30, 2007, to add these 
requirements through a future rule-making revision. Additionally, the 
state committed to clarify this state rule to more closely comport with 
federal requirements (The deficiencies being addressed are described in 
more detail above in Part III of this document entitled ``What Are The 
Changes That EPA is Conditionally Approving?'').
    Under section 110(k)(4) of the CAA, EPA may conditionally approve a 
SIP revision based on a commitment from the state to adopt specific 
enforceable measures by a date certain that is no more than one year 
from the date of conditional approval. In this action, we are proposing 
to approve the SIP revision that Michigan has submitted on the 
condition that the specified deficiencies in the SIP revision are 
corrected, as noted above, within a year of a final conditional 
approval of the rules.
    If this condition is not fulfilled within one year of the effective 
date of final rulemaking by correction of all of the specified 
deficiencies, the conditional approval for the uncorrected sections of 
the state rules will automatically revert to disapproval, as of the 
deadline for meeting the conditions, without further action from the 
EPA. EPA would subsequently publish a notice in the Federal Register 
providing notice and details of such disapproval.
    If Michigan submits final and effective rule revisions correcting 
the deficiencies, as discussed above, within one year from this 
conditional approval becoming final and effective, EPA will publish a 
subsequent notice in the Federal Register to acknowledge conversion of 
the conditional approval to a full approval.

V. Statutory and Executive Order Reviews.

Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, September 30, 1993), this 
action is not a ``significant regulatory action'' and therefore is not 
subject to review by the Office of Management and Budget.

Paperwork Reduction Act

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

Regulatory Flexibility Act

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

Unfunded Mandates Reform Act

    Because this rule proposes to approve pre-existing requirements 
under state

[[Page 1576]]

law and does not impose any additional enforceable duty beyond that 
required by state law, it does not contain any unfunded mandate or 
significantly or uniquely affect small governments, as described in the 
Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4).

Executive Order 13132: Federalism

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

Executive Order 13175: Consultation and Coordination With Indian Tribal 
Governments

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

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

    This proposed rule also is not subject to Executive Order 13045 
``Protection of Children from Environmental Health Risks and Safety 
Risks'' (62 FR 19885, April 23, 1997), because it proposes approval of 
a state rule implementing a Federal Standard.

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

    Because it is not a ``significant regulatory action'' under 
Executive Order 12866 or a ``significant regulatory action,'' this 
action is also not subject to Executive Order 13211, ``Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use'' (66 FR 28355, May 22, 2001).

National Technology Transfer Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), 15 U.S.C. 272, requires Federal agencies to use 
technical standards that are developed or adopted by voluntary 
consensus to carry out policy objectives, so long as such standards are 
not inconsistent with applicable law or otherwise impractical. In 
reviewing SIP submissions, EPA's role is to approve state choices, 
provided that they meet the criteria of the CAA. Absent a prior 
existing requirement for the state to use voluntary consensus 
standards, EPA has no authority to disapprove a SIP submission for 
failure to use such standards, and it would thus be inconsistent with 
applicable law for EPA to use voluntary consensus standards in place of 
a program submission that otherwise satisfies the provisions of the 
CAA. Therefore, the requirements of section 12(d) of the NTTAA do not 
apply.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, 
Incorporation by reference, Intergovernmental relations, Lead, Nitrogen 
dioxide, Ozone, Particulate matter, Reporting and recordkeeping 
requirements, Sulfur oxides, Volatile organic compounds.

    Dated: December 27, 2007.
Gary Gulezian,
Acting Regional Administrator, Region 5.
[FR Doc. E8-186 Filed 1-8-08; 8:45 am]
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