[Federal Register Volume 76, Number 239 (Tuesday, December 13, 2011)]
[Notices]
[Pages 77515-77521]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-31909]


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ENVIRONMENTAL PROTECTION AGENCY

[FRL-9503-4]


California State Nonroad Engine Pollution Control Standards; 
Ocean-Going Vessels At-Berth in California Ports; Notice of Decision

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of decision.

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SUMMARY: EPA has granted the California Air Resources Board (CARB) its 
request for an authorization to adopt and enforce regulations for its 
airborne toxic control measures for auxiliary diesel engines operated 
on ocean-going vessels at-berth in California ports (``At-Berth 
Regulation''). The At-Berth Regulation is designed to reduce emissions 
of oxides of nitrogen and particulate matter from auxiliary diesel 
engines on container vessels, passenger vessels and refrigerated cargo 
vessels while they are docked at specified California ports.

DATES: Petitions for review must be filed by February 13, 2012.

ADDRESSES: EPA has established a docket for this action under Docket ID 
EPA-HQ-OAR-2011-0548. All documents relied upon in making this 
decision, including those submitted to EPA by CARB, and public 
comments, are contained in the public docket. Publicly available docket 
materials are available either electronically through http://www.regulations.gov or in hard copy at the Air and Radiation Docket in 
the EPA Headquarters Library, EPA West Building, Room 3334, located at 
1301 Constitution Avenue NW., Washington, DC. The Public Reading Room 
is open to the public on all Federal government working days from 8:30 
a.m. to 4:30 p.m.; generally, it is open Monday through Friday, 
excluding holidays. The telephone number for the Reading Room is (202) 
566-1744. The Air and Radiation Docket and Information Center's Web 
site is http://www.epa.gov/oar/docket.html. The electronic mail (email) 
address for the Air and Radiation Docket is: [email protected], 
the telephone number is (202) 566-1742, and the fax number is (202) 
566-9744. An electronic version of the public docket is available 
through the Federal government's electronic public docket and comment 
system. You may access EPA dockets at http://www.regulations.gov. After 
opening the http://www.regulations.gov Web site, enter EPA-HQ-OAR-2011-
0548 in the ``Enter Keyword or ID'' fill-in box to view documents in 
the record. Although a part of the official docket, the public docket 
does not include Confidential Business Information (``CBI'') or other 
information whose disclosure is restricted by statute.
    EPA's Office of Transportation and Air Quality (``OTAQ'') maintains 
a Web page that contains general information on its review of 
California waiver requests. Included on that page are links to prior 
waiver Federal Register notices, some of which are cited in today's 
notice; the page can be accessed at http://www.epa.gov/otaq/cafr.htm.

FOR FURTHER INFORMATION CONTACT: Kristien G. Knapp, Attorney-Advisor, 
Compliance Division, Office of Transportation and Air Quality, U.S. 
Environmental Protection Agency, 1200 Pennsylvania Avenue (6405J) NW., 
Washington, DC 20460. Telephone: (202) 343-9949. Fax: (202) 343-2800. 
Email: [email protected].

SUPPLEMENTARY INFORMATION:

I. Background

A. California's At-Berth Regulation

    By letter dated August 2, 2010, CARB submitted to EPA its request 
pursuant to section 209(e) of the Clean Air Act (``CAA'' or ``the 
Act''), regarding its regulations to enforce its airborne toxic control 
measures (ATCM) for auxiliary diesel engines operated on ocean-going 
vessels at-berth in California ports (``At-Berth Regulation'').\1\ The 
At-Berth Regulation is designed to significantly reduce emissions of 
diesel particulate matter (PM), which is a CARB-identified toxic air 
contaminant, oxides of nitrogen (NOX), and carbon dioxide 
(CO2), a greenhouse gas. These reductions will assist 
California in meeting Federal and state ambient air quality standards 
for the South Coast and San Joaquin Valley air basins for ozone and 
fine particulate matter (PM2.5). CARB approved the At-Berth 
Regulation at a public hearing on December 6, 2007 (by Resolution 07-
57).\2\ After making modifications to the regulation available on 
August 22, 2008 for supplemental public comment, CARB's Executive 
Officer formally adopted the At-Berth Regulation in Executive Order R-
08-013 on October 16, 2008.\3\ The At-Berth Regulation is codified in 
title 13, California Code of Regulations, section 2299.3, and title 17, 
California Code of Regulations, section 93118.3.\4\
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    \1\ California Air Resources Board (``CARB''), ``Request for 
Authorization,'' August 2, 2010, EPA-HQ-OAR-2011-0548-0001.
    \2\ CARB Attachment 4, ``Resolution 07-57,'' EPA-HQ-
OAR-2011-0548-0006.
    \3\ CARB Attachment 6, ``Executive Order R-08-013,'' 
EPA-HQ-OAR-2011-0548-0008.
    \4\ CARB Attachment 8, ``Final Regulation Order for 
title 13, CCR section 2299.3,'' EPA-HQ-OAR-2011-0548-0010; CARB 
Attachment 9, ``Final Regulation Order for title 17, CCR 
section 93118.3,'' EPA-HQ-OAR-2011-0548-0011.
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    CARB's At-Berth Regulation contains requirements that apply, with 
limited exceptions,\5\ to any person who owns,

[[Page 77516]]

operates, charters, rents or leases any container vessel, passenger 
vessel, or refrigerated cargo vessel that visits any of six specified 
California ports.\6\ It also contains requirements that affect any 
person who owns or operates those ports or terminals located at them.
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    \5\ The following vessels are exempt from the At-Berth 
Regulation: Ocean going vessel voyages consisting of continuous and 
expeditious navigation (i.e., traversing Regulated California Waters 
without entering California internal estuarine waters or calling at 
a port); vessels owned or operated by local, state, Federal, or 
foreign governments in government non-commercial services; 
steamships; auxiliary engines using natural gas; and fleets composed 
solely of container or refrigerated cargo vessels making fewer than 
twenty-five visits to the same California port in a calendar year or 
fleets composed solely of passenger vessels making fewer than five 
visits to the same California port in a calendar year. Exemptions 
also exist for emergency events and hotelling required by a Federal 
agency. Title 17, California Code of Regulations (CCR), section 
93118.3(b)(3), CARB Attachment 9, ``Final Regulation Order 
for title 17, CCR section 93118.3,'' EPA-HQ-OAR-2011-0548-0011.
    \6\ The At-Berth Regulation applies to vessels docked at six 
California ports: the Port of Hueneme, the Port of Los Angeles, the 
Port of Long Beach, the Port of Oakland, the Port of San Diego, and 
the Port of San Francisco.
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    The At-Berth Regulation requires fleets of container vessels, 
passenger vessels and refrigerated cargo vessels to either: (1) Limit 
the amount of time they operate their auxiliary diesel engines by 
connecting to shore power for most of a vessel's stay at port (``Shore 
Power Option''); or (2) achieve equivalent emission reductions by 
employing other emission control techniques (``Equivalent Emission 
Reduction Option'').\7\ Fleet operators who elect the Shore Power 
Option are required to obtain the power that would otherwise be 
provided by a vessel's auxiliary engines by connecting to shore power 
for a percentage of the fleet's annual port visits.\8\ The required 
percentage of shore power connected port visits increases over the life 
of the regulation. Specifically, fifty percent of a fleet's total 
visits must be connected to shore power by 2014, followed by seventy 
percent by 2017, and eighty percent by 2020. Additionally, if a vessel 
is equipped to connect to shore power and it visits a berth equipped to 
provide compatible power, the vessel must use the shore power provided.
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    \7\ ``Fleet'' means ``all container, passenger, and refrigerated 
cargo vessels, visiting a specific California port, which are owned 
and operated by, or otherwise under the direct control, of the same 
Person * * * For purposes of this section, a person shall be deemed 
to have separate fleets for each California port visited and each 
fleet is composed of one type of vessel.'' Title 17, CCR section 
93118.3(c)(16). See also CARB, ``Authorization Support Document,'' 
EPA-HQ-OAR-2011-0548-0002.
    \8\ ``Shore power'' is defined as ``electrical power being 
provided by either the local utility or by distributed generation.'' 
CARB Attachment 9, ``Final Regulation Order for title 17, CCR 
section 93118.3,'' EPA-HQ-OAR-2011-0548-0011.
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    Fleet operators who elect the Equivalent Emission Reduction Option 
must reduce their fleet's auxiliary engine emissions by specific 
amounts below the fleet's baseline emissions by specific dates.\9\ This 
option requires that a fleet achieve a ten percent reduction from the 
fleet's baseline emissions by 2010, a twenty-five percent reduction by 
2012, a fifty percent reduction by 2014, a seventy percent reduction by 
2017, and an eighty percent reduction by 2020. Emission reductions can 
be achieved by: (1) Using grid-based shore power; (2) using distributed 
generation equipment to provide power to the vessel; (3) using 
alternative emission controls onboard a vessel or at the berth; or (4) 
using a combination of these techniques. Fleets that achieve reductions 
of emissions of oxides of nitrogen or particulate matter in excess of 
the prescribed reductions receive fleet emission credits that can be 
used to comply with emission reduction requirements in subsequent 
years.
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    \9\ CARB, ``Authorization Support Document,'' August 2, 2010, 
EPA-HQ-OAR-2011-0548-0002 (hereinafter ``CARB Support Document''.
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    The At-Berth Regulation also requires operators of terminals that 
received more than fifty vessel visits in 2008 to submit terminal plans 
identifying how the terminals will be upgraded to accommodate vessels 
under the two compliance options, including a schedule for implementing 
the needed infrastructure improvements. Terminal operators are required 
to submit plan updates at a frequency dependent upon the compliance 
option selected by the vessel fleet owner or operator and the 
terminals. The At-Berth Regulation also includes associated enforcement 
requirements, such as reporting and recordkeeping requirements.

B. Clean Air Act Nonroad Engine and Vehicle Authorizations

    Section 209(e)(1) of the Act permanently preempts any State, or 
political subdivision thereof, from adopting or attempting to enforce 
any standard or other requirement relating to the control of emissions 
for certain new nonroad engines or vehicles. Section 209(e)(2) of the 
Act requires the Administrator to grant California authorization to 
enforce its own standards for new nonroad engines or vehicles that are 
not listed under section 209(e)(1), subject to certain restrictions. On 
July 20, 1994, EPA promulgated a rule that sets forth, among other 
things, the criteria, as found in section 209(e)(2), which EPA must 
consider before granting any California authorization request for new 
nonroad engine or vehicle emission standards. On October 8, 2008, the 
regulations promulgated in that rule were moved to 40 CFR part 1074, 
and modified slightly.\10\ As stated in the preamble to the section 
209(e) rule, EPA has historically interpreted the section 
209(e)(2)(iii) ``consistency'' inquiry to require, at minimum, that 
California standards and enforcement procedures be consistent with 
section 209(a), section 209(e)(1), and section 209(b)(1)(C) (as EPA has 
interpreted that subsection in the context of section 209(b) motor 
vehicle waivers).\11\
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    \10\ The applicable regulations, now in 40 CFR part 1074, 
subpart B, Sec.  1074.105, provide:
    (a) The Administrator will grant the authorization if California 
determines that its standards will be, in the aggregate, at least as 
protective of public health and welfare as otherwise applicable 
Federal standards.
    (b) The authorization will not be granted if the Administrator 
finds that any of the following are true:
    (1) California's determination is arbitrary and capricious.
    (2) California does not need such standards to meet compelling 
and extraordinary conditions.
    (3) The California standards and accompanying enforcement 
procedures are not consistent with section 209 of the Act.
    (c) In considering any request from California to authorize the 
state to adopt or enforce standards or other requirements relating 
to the control of emissions from new nonroad spark-ignition engines 
smaller than 50 horsepower, the Administrator will give appropriate 
consideration to safety factors (including the potential increased 
risk of burn or fire) associated with compliance with the California 
standard.
    \11\ See 59 FR 36969 (July 20, 1994).
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    In order to be consistent with section 209(a), California's nonroad 
standards and enforcement procedures must not apply to new motor 
vehicles or new motor vehicle engines. To be consistent with section 
209(e)(1), California's nonroad standards and enforcement procedures 
must not attempt to regulate engine categories that are permanently 
preempted from state regulation. To determine consistency with section 
209(b)(1)(C), EPA typically reviews nonroad authorization requests 
under the same ``consistency'' criteria that are applied to motor 
vehicle waiver requests. Pursuant to section 209(b)(1)(C), the 
Administrator shall not grant California a motor vehicle waiver if she 
finds that California ``standards and accompanying enforcement 
procedures are not consistent with section 202(a)'' of the Act. 
Previous decisions granting waivers and authorizations have noted that 
state standards and enforcement procedures are inconsistent with 
section 202(a) if: (1) There is inadequate lead time to permit the 
development of the necessary technology giving appropriate 
consideration to the cost of compliance within that time, or (2) the 
Federal and state testing procedures impose inconsistent certification 
requirements.

C. Burden of Proof

    In Motor and Equip. Mfrs Assoc. v. EPA, 627 F.2d 1095 (DC Cir. 
1979) (``MEMA I''), the U.S. Court of Appeals

[[Page 77517]]

stated that the Administrator's role in a section 209 proceeding is to:

consider all evidence that passes the threshold test of materiality 
and * * * thereafter assess such material evidence against a 
standard of proof to determine whether the parties favoring a denial 
of the waiver have shown that the factual circumstances exist in 
which Congress intended a denial of the waiver.\12\
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    \12\ MEMA I, 627 F.2d at 1122.

The court in MEMA I considered the standards of proof under section 209 
for the two findings related to granting a waiver for an ``accompanying 
enforcement procedure'' (as opposed to the standards themselves): (1) 
Protectiveness in the aggregate and (2) consistency with section 202(a) 
findings. The court instructed that ``the standard of proof must take 
account of the nature of the risk of error involved in any given 
decision, and it therefore varies with the finding involved. We need 
not decide how this standard operates in every waiver decision.'' \13\
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    \13\ Id.
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    The court upheld the Administrator's position that, to deny a 
waiver, there must be `clear and compelling evidence' to show that 
proposed procedures undermine the protectiveness of California's 
standards.\14\ The court noted that this standard of proof also accords 
with the congressional intent to provide California with the broadest 
possible discretion in setting regulations it finds protective of the 
public health and welfare.\15\
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    \14\ Id.
    \15\ Id.
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    With respect to the consistency finding, the court did not 
articulate a standard of proof applicable to all proceedings, but found 
that the opponents of the waiver were unable to meet their burden of 
proof even if the standard were a mere preponderance of the evidence. 
Although MEMA I did not explicitly consider the standards of proof 
under section 209 concerning a waiver request for ``standards,'' as 
compared to accompanying enforcement procedures, there is nothing in 
the opinion to suggest that the court's analysis would not apply with 
equal force to such determinations. EPA's past waiver decisions have 
consistently made clear that: ``[E]ven in the two areas concededly 
reserved for Federal judgment by this legislation--the existence of 
`compelling and extraordinary' conditions and whether the standards are 
technologically feasible--Congress intended that the standards of EPA 
review of the State decision to be a narrow one.'' \16\
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    \16\ See, e.g., 40 FR 21102-103 (May 28, 1975).
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    Opponents of the waiver bear the burden of showing that the 
criteria for a denial of California's waiver request have been met. As 
found in MEMA I, this obligation rests firmly with opponents of the 
waiver in a section 209 proceeding:

[t]he language of the statute and its legislative history indicate 
that California's regulations, and California's determinations that 
they must comply with the statute, when presented to the 
Administrator are presumed to satisfy the waiver requirements and 
that the burden of proving otherwise is on whoever attacks them. 
California must present its regulations and findings at the hearing 
and thereafter the parties opposing the waiver request bear the 
burden of persuading the Administrator that the waiver request 
should be denied.\17\
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    \17\ MEMA I, 627 F.2d at 1121.

    The Administrator's burden, on the other hand, is to make a 
reasonable evaluation of the information in the record in coming to the 
waiver decision. As the court in MEMA I stated: ``here, too, if the 
Administrator ignores evidence demonstrating that the waiver should not 
be granted, or if he seeks to overcome that evidence with unsupported 
assumptions of his own, he runs the risk of having his waiver decision 
set aside as `arbitrary and capricious.' '' \18\ Therefore, the 
Administrator's burden is to act ``reasonably.'' \19\
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    \18\ Id. at 1126.
    \19\ Id.
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D. EPA's Administrative Process in Consideration of California's At-
Berth Regulation

    Upon review of CARB's request, EPA offered an opportunity for a 
public hearing, and requested written comment on issues relevant to a 
full section 209(e) authorization analysis, by publication of a Federal 
Register notice on June 29, 2011.\20\ Specifically, we requested 
comment on: (a) Whether CARB's determination that its standards, in the 
aggregate, are at least as protective of public health and welfare as 
applicable Federal standards is arbitrary and capricious, (b) whether 
California needs such standards to meet compelling and extraordinary 
conditions, and (c) whether California's standards and accompanying 
enforcement procedures are consistent with section 209 of the Act.
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    \20\ 76 FR 38155 (June 29, 2011).
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    In response to EPA's June 29, 2011 Federal Register notice, EPA 
received one public comment. The comment is from the Pacific Merchant 
Shipping Association (``PMSA''). PMSA makes four general comments. 
First, PMSA comments that California's At-Berth Regulation is arbitrary 
and capricious under section 209 of the Clean Air Act. Second, PMSA 
comments that the At-Berth Regulation does not adequately address 
significant economic impact issues and assess fleet composition. Third, 
PMSA comments that CARB lacks statutory authority to pursue its At-
Berth Regulation as an in-use operation regulation that requires 
retrofits. Fourth, PMSA comments that the California At-Berth 
Regulation is preempted under section 209(e)(2) of the Clean Air Act.

II. Discussion

A. California's Protectiveness Determination

    Section 209(e)(2)(i) of the Act instructs that EPA cannot grant an 
authorization if the agency finds that California was arbitrary and 
capricious in its determination that its standards are, in the 
aggregate, at least as protective of public health and welfare as 
applicable Federal standards. CARB's Board made a protectiveness 
determination in Resolution 07-57, finding that California's At-Berth 
Regulation will not cause the California emission standards, in the 
aggregate, to be less protective of public health and welfare than 
applicable Federal standards.\21\ CARB highlights that EPA is 
authorized to regulate new nonroad engines, and only California may 
adopt emission standards and other emission-related requirements for 
in-use nonroad engines.\22\ Accordingly, CARB points out that EPA has 
not adopted any emission standards or other requirements applicable to 
in-use nonroad engines, including auxiliary diesel engines operated on 
ocean-going vessels. CARB concludes that ``no question exists that the 
At-Berth Regulation is at least as protective of public health and 
welfare as applicable federal standards.''
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    \21\ ``BE IT FURTHER RESOLVED that the Board hereby determines, 
pursuant to section 209(e)(2) of the Federal Clean Air Act, the 
requirements in the adopted regulation, to the extent they are 
determined to be emission standards or requirements related to the 
control of emissions, are, in the aggregate, at least as protective 
of public health and welfare as applicable Federal standards, that 
California needs the adopted standards to meet compelling and 
extraordinary conditions, and that the adopted requirements, 
standards, and accompanying provisions are consistent with the 
provisions in section 209.'' CARB, Resolution 07-57, EPA-HQ-OAR-
2011-0549-0007.
    \22\ CARB Support Document at 7; see Engine Mfrs. Assoc. v. EPA, 
88 F.3d 1075, 1089-1090 (DCCir 1996).
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    EPA did not receive any comments directly challenging California's 
protectiveness determination, but did receive one comment from PMSA, 
who

[[Page 77518]]

presents that California's At-Berth Regulation is, more generally, 
arbitrary and capricious. PMSA's ``arbitrary and capricious'' comment 
is not concerned with California's protectiveness determination (i.e., 
the stringency of the standards, or the health and welfare effects of 
the regulation); what PMSA is concerned about is that the regulation 
should be more closely tailored to the emissions it seeks to reduce. 
PMSA complains that California regulates only some types of vessels and 
not others. EPA's review of California's protectiveness determination, 
however, is limited under section 209(e)(2)(i). The Agency's review is 
highly deferential to California's policy judgment as expressed in its 
final regulation. The Clean Air Act does not leave room for EPA to 
second-guess the wisdom of California's policy. EPA is charged with 
determining whether California made its protectiveness determination 
arbitrarily and capriciously; conversely, EPA is not tasked with 
conducting a more searching ``arbitrary and capricious'' review of 
California's regulation. Furthermore, the issues PMSA raises when it 
opines that California's At-Berth Regulation is ``arbitrary and 
capricious'' are not the type of issues that EPA traditionally 
considers as part of its evaluation of California's protectiveness 
determination. When evaluating California's protectiveness 
determination, EPA traditionally compares the stringency of the 
California and Federal standards at issue in a given waiver or 
authorization request. That comparison is undertaken within the broader 
context of the previously waived California program, which relies upon 
protectiveness determinations that EPA previously found were not 
arbitrary and capricious. EPA refrains from conducting a more detailed 
examination of the California rulemaking more generally. Such an 
undertaking would seemingly go beyond the review that Congress 
intended.\23\ Considering PMSA's comments within the context of EPA's 
traditional protectiveness provides no additional opportunity to 
question California's protectiveness determination because PMSA 
provides no indication that California's standards are less stringent 
than comparable Federal standards. Additionally, even if we were to 
take into account PMSA's ``arbitrary and capricious'' concerns when 
reviewing California's protectiveness determination, PMSA's concerns to 
do not present sufficient evidence to meet its burden of proof. PMSA 
does not present any factual evidence or analysis of any health and 
welfare effects they expect to be caused by California's regulation. 
Such evidence and analysis would be necessary to show that California's 
standards are less protective of health and welfare. Thus, in this 
comment PMSA does not meet its burden to show that California's 
protectiveness determination was arbitrary and capricious.\24\
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    \23\ MEMA I, 627 F.2d at 1121.
    \24\ PMSA's ``arbitrary and capricious'' comment is also 
addressed below in section III.D.
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    Therefore, based on the record before us, EPA finds that opponents 
of the authorization have not shown that California was arbitrary and 
capricious in its determination that its standards are, in the 
aggregate, at least as protective of public health and welfare as 
applicable Federal standards.

B. Need for California Standards To Meet Compelling and Extraordinary 
Conditions

    Section 209(e)(2)(ii) of the Act instructs that EPA cannot grant an 
authorization if the agency finds that California ``does not need such 
California standards to meet compelling and extraordinary conditions. * 
* *'' This criterion restricts EPA's inquiry to whether California 
needs its own mobile source pollution program to meet compelling and 
extraordinary conditions, and not whether any given standards are 
necessary to meet such conditions.\25\ As discussed above, for over 
forty years CARB has repeatedly demonstrated the need for its mobile 
source emissions program to address compelling and extraordinary 
conditions in California. In its Resolution 07-57, CARB affirmed its 
longstanding position that California continues to need its own motor 
vehicle and engine program to meet its serious air pollution problems. 
Likewise, EPA has consistently recognized that California continues to 
have the same ``geographical and climatic conditions that, when 
combined with the large numbers and high concentrations of automobiles, 
create serious pollution problems.'' \26\ Furthermore, no commenter has 
presented any argument or evidence to suggest that California no longer 
needs a separate mobile source emissions program to address compelling 
and extraordinary conditions in California.\27\ Therefore, EPA has 
determined that we cannot deny California a waiver for its At-Berth 
Regulation under section 209(e)(2)(ii).
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    \25\ See 74 FR 32744, 32761 (July 8, 2009); 49 FR 18887, 18889-
18890 (May 3, 1984).
    \26\ 49 FR 18887, 18890 (May 3, 1984); see also 76 FR 34693 
(June 14, 2011), 74 FR 32744, 32763 (July 8, 2009), and 73 FR 52042 
(September 8, 2008).
    \27\ PMSA did comment that the possibility that other states may 
adopt California's At-Berth Regulation ``raises the issue that CARB 
has not demonstrated that this regulation is necessary `to meet 
compelling and extraordinary conditions' under section 
209(e)(2)(A)(ii), of the Act.'' However, after raising the issue, 
PMSA did not offer any argument or evidence to support its 
conclusion. California clearly provided a demonstration in its 
request for authorization that it needs its standards to meet 
compelling and extraordinary conditions.
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C. Consistency With Section 209 of the Clean Air Act

    Section 209(e)(2)(iii) of the Act instructs that EPA cannot grant 
an authorization if California's standards and enforcement procedures 
are not consistent with section 209. As described above, EPA has 
historically evaluated this criterion for consistency with sections 
209(a), 209(e)(1), and 209(b)(1)(C).
1. Consistency With Section 209(a)
    To be consistent with section 209(a) of the Clean Air Act, 
California's At-Berth Regulation must not apply to new motor vehicles 
or new motor vehicle engines. California's At-Berth Regulation apply to 
auxiliary diesel engines, which are nonroad engines, not on-highway 
motor vehicles or engines. CARB further clarifies that because 
auxiliary diesel engines are regulated as nonroad engines, they fall 
within the regulatory definition of nonroad engine, and are, thus, 
consistent with section 209(a). No commenter presented otherwise; 
therefore, EPA cannot deny California's request on the basis that 
California's At-Berth Regulation is not consistent with section 209(a).
2. Consistency With Section 209(e)(1)
    To be consistent with section 209(e)(1) of the Clean Air Act, 
California's At-Berth Regulation must not affect new farming or 
construction vehicles or engines that are below 175 horsepower, or new 
locomotives or their engines. CARB again clarifies that its At-Berth 
Regulation applies to in-use auxiliary diesel engines operated on 
ocean-going vessels while at-berth in a California port. Such engines 
are not used in locomotives and are not primarily used in farm and 
construction equipment vehicles. No commenter presented otherwise; 
therefore, EPA cannot deny California's request on the basis that 
California's At-Berth Regulation is not consistent with section 
209(e)(1).
3. Consistency With Section 209(b)(1)(C)
    The requirement that California's standards be consistent with 
section 209(b)(1)(C) of the Clean Air Act effectively requires 
consistency with

[[Page 77519]]

section 202(a) of the Act. California standards are inconsistent with 
section 202(a) of the Act if there is inadequate lead-time to permit 
the development of technology necessary to meet those requirements, 
giving appropriate consideration to the cost of compliance within that 
timeframe. California's accompanying enforcement procedures would also 
be inconsistent with section 202(a) if Federal and California test 
procedures conflicted. The scope of EPA's review of whether 
California's action is consistent with section 202(a) is narrow. The 
determination is limited to whether those opposed to the authorization 
or waiver have met their burden of establishing that California's 
standards are technologically infeasible, or that California's test 
procedures impose requirements inconsistent with the Federal test 
procedures.\28\
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    \28\ MEMA I, 627, F.2d at 1126.
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a. Technological Feasibility
    Congress has stated that the consistency requirement of section 
202(a) relates to technological feasibility.\29\ Section 202(a)(2) 
states, in part, that any regulation promulgated under its authority 
``shall take effect after such period as the Administrator finds 
necessary to permit the development and application of the requisite 
technology, giving appropriate consideration to the cost of compliance 
within such period.'' Section 202(a) thus requires the Administrator to 
first determine whether adequate technology already exists; or if it 
does not, whether there is adequate time to develop and apply the 
technology before the standards go into effect. The latter scenario 
also requires the Administrator to decide whether the cost of 
developing and applying the technology within that time is feasible. 
Previous EPA waivers are in accord with this position.\30\ For example, 
a previous EPA waiver decision considered California's standards and 
enforcement procedures to be consistent with section 202(a) because 
adequate technology existed as well as adequate lead-time to implement 
that technology.\31\ Subsequently, Congress has stated that, generally, 
EPA's construction of the waiver provision has been consistent with 
congressional intent.\32\
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    \29\ H.R. Rep. No. 95-294, 95th Cong., 1st Sess. 301 (1977).
    \30\ See, e.g., 49 FR 1887, 1895 (May 3, 1984); 43 FR 32182, 
32183 (July 25, 1978); 41 FR 44209, 44213 (October 7, 1976).
    \31\ 41 FR 44209 (October 7, 1976).
    \32\ H.R. Rep. No. 95-294, 95th Cong., 1st Sess. 301 (1977).
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    CARB presents that the technology required to comply with both the 
Shore Power Option and the Equivalent Emission Reduction Option is 
currently available, and that it has provided sufficient lead-time.\33\ 
For the Shore Power Option, which CARB expects to be the choice of most 
vessel operators, CARB asserts that technology is proven and currently 
in use at several terminals. The technology needed to comply with the 
Shore Power Option is grid-based shore power, in which vessel operators 
shut off vessel auxiliary engines and switch to shore based electricity 
to power a berthed vessel. CARB acknowledges that while some terminals 
already have implemented shore power capacity, others have not; 
nevertheless, all twenty-eight terminals subject to the At-Berth 
Regulation have already submitted compliance plans to install grid-
based shore power at their terminals. Also, although the installation 
may take between two and three years to complete, CARB has provided six 
years of lead-time. CARB also notes that vessels have an additional 
flexibility, because fleets may route ships to certain ports to comply. 
For the Equivalent Emission Reduction Option, CARB asserts that there 
are a variety of emission control technologies that currently exist and 
are already in use, including distributed electrical generation 
technologies, such as compressed natural gas generators that are 
equipped with best available control technology. CARB explains that the 
At-Berth Regulation allows vessel operators to combine technologies and 
shore power to meet their emission reduction requirements, and that the 
compliance levels require increasing reductions over the course of ten 
years. CARB believes that its compliance flexibilities and phased-in 
timelines establish that there is sufficient lead-time.
---------------------------------------------------------------------------

    \33\ CARB Support Document at 9-11.
---------------------------------------------------------------------------

    CARB also considered the cost of compliance in its rulemaking 
record, and asserts that ``ports, terminal operators, and fleet owners 
and operators will largely be able to pass on their compliance costs 
for both compliance options [] to their customers without incurring 
significant economic disruption or impact on business 
competitiveness.'' \34\ CARB presents that costs incurred by terminal 
operators will be passed along to vessel fleet operators, who will pass 
them along to their customers. CARB expects the cost of its At-Berth 
Regulation on a typical terminal operator to be about $11 million over 
the course of the 2009-2020 compliance schedule. CARB also expects that 
costs will be passed on to customers, at different rates depending on 
the category of vessel and each vessel's particular use. Compliance 
with the Shore Power Option will also include the added cost of the 
grid-based electricity. CARB presents that container ships will not see 
a net increase because lower fuel costs will offset the increased 
electricity costs; passenger vessels and refrigerated cargo vessels, on 
the other hand, may see an increase in energy cost that can be passed 
along to customers through ``negligible increases in cargo costs.'' 
\35\ Based on its presentation of technological feasibility and cost of 
compliance, CARB concludes ``the At-Berth Regulation is feasible within 
the time provided for compliance, giving appropriate consideration of 
costs.'' \36\
---------------------------------------------------------------------------

    \34\ CARB Support Document at 11; see also CARB, Technical 
Support Document, EPA-HQ-OAR-2011-0548-0006.
    \35\ Id.
    \36\ Id.
---------------------------------------------------------------------------

    EPA did not receive any comments suggesting that CARB's standards 
and test procedures are technologically infeasible. EPA did receive 
comments--from PMSA--suggesting that CARB did not adequately address 
the cost of compliance. PMSA asserts that California's At-Berth 
Regulation did not adequately address the significant economic impact 
issues or appropriately assess fleet composition. PMSA therein presents 
several challenges to the cost-effectiveness of the At-Berth 
Regulation. First, PMSA suggests that CARB did not consider actual 
baseline emissions of vessels at-berth. Second, PMSA suggests that 
there is tremendous variability of compliance costs associated with the 
At-Berth Regulation, so terminal operators and ocean-carriers who find 
themselves on the high end of the cost spectrum due to their port 
authority and municipal utility will face higher compliance costs. 
Third, PMSA asserts that CARB failed to identify ports as direct 
contributors in its assignment of costs. PMSA presented each of these 
comments in the California rulemaking, and CARB responded to each in 
its Final Statement of Reasons for Rulemaking (``FSOR''). With regard 
to PMSA's first point, CARB answered that it did not count voluntary 
emission reductions because they are not required by law, and that it 
did not count reductions from its low sulfur fuel requirements so as 
not to double-count those reductions.\37\ With respect to PMSA's second 
point on cost-effectiveness, CARB agrees with PMSA that compliance 
costs are variable, and

[[Page 77520]]

answers that the At-Berth Regulation presents compliance options that 
treat terminal operators and ports fairly, and that the market--not 
CARB--will determine who bears the various costs of compliance.\38\ 
With respect to PMSA's third point on identification of ports as direct 
contributors, CARB concurred that ports will incur costs due to the 
regulation, and explained that it allocated costs to vessel fleet 
operators, terminals, and utilities because vessel fleet operators are 
the entities who are responsible for costs associated with 
compliance.\39\ CARB assigned the cost of port improvements to the 
terminals on its assumption that ports would make the improvements and 
pass the costs of the improvements along to the terminals.
---------------------------------------------------------------------------

    \37\ CARB, ``Final Statement of Reasons for Rulemaking Including 
Summary of Comments and Agency Responses,'' EPA-HQ-OAR-2011-0548-
0010, pp. 70-71 (hereinafter ``CARB FSOR'').
    \38\ CARB FSOR at 69-70.
    \39\ CARB FSOR at 70.
---------------------------------------------------------------------------

    EPA's own review with regard to cost of compliance occurs within 
the context of its review of whether California's At-Berth Regulation 
is consistent with section 202(a) of the Clean Air Act. As described 
above, EPA's review here is narrow. That is, section 202(a) consistency 
calls for a limited review of technological feasibility, including 
analysis of the cost of new technology, if technology does not 
currently exist. Section 202(a) does not allow EPA to conduct a more 
searching review of whether the costs are outweighed by the overall 
benefits of the California regulations. In this case, no party has 
objected to CARB's demonstration that technologies are in existence and 
are being used in actual operation. EPA's traditional review of costs 
considers whether the cost of compliance per engine would render the 
regulation cost prohibitive and thus infeasible, not whether 
California's regulation is cost-effective. Here, CARB acknowledges and 
understands that there are significant costs associated with 
compliance, but CARB expects those costs to eventually be passed on to 
the consumer, without significant effect. PMSA's comments do not 
challenge the feasibility of the regulation. PMSA instead challenges 
overall cost-effectiveness of the regulation, how costs are allocated, 
and the variability of costs. These issues are more appropriately 
considered by CARB in its rulemaking, and not here in EPA's limited 
section 209(e) authorization review. More importantly for this 
proceeding, PMSA has not presented that the compliance costs are such 
that compliance with the At-Berth Regulation would be infeasible or 
unreasonable. To the contrary, CARB has presented that the costs of the 
regulation are not prohibitive. CARB has found that cost of the At-
Berth Regulation is reasonable, cost-effective, and capable of being 
absorbed by the regulated industry and passed on to consumers, with 
minimal overall economic impact. Consequently, based on the record, EPA 
cannot deny California's authorization based on technological 
infeasibility.
b. Consistency of Certification Procedures
    California's standards and accompanying enforcement procedures 
would also be inconsistent with section 202(a) if the California test 
procedures were to impose certification requirements inconsistent with 
the Federal certification requirements. Such inconsistency means that 
manufacturers would be unable to meet both the California and Federal 
testing requirements using the same test vehicle or engine.\40\
---------------------------------------------------------------------------

    \40\ See, e.g., 43 FR 32182 (July 25, 1978).
---------------------------------------------------------------------------

    CARB presents that its At-Berth Regulation does not pose any 
inconsistency as between California and Federal test procedures. First, 
CARB asserts that its At-Berth Regulation does not adopt or create any 
new test procedures. Second, CARB asserts that although its At-Berth 
Regulation incorporates by reference a number of standards and test 
procedures, it does not require any additional certification 
requirement beyond those already required for new engines, at the 
Federal and state levels. Third, CARB asserts that its At-Berth 
Regulation does not conflict with existing Federal and state diesel 
emission control verification testing.
    EPA received no comments suggesting that CARB's At-Berth Regulation 
poses a test procedure consistency problem. Therefore, based on the 
record, EPA cannot find that CARB's testing procedures are inconsistent 
with section 202(a). Consequently, EPA cannot deny CARB's request based 
on this criterion.

D. Other Issues

    PMSA presents three general comments in opposition to California's 
At-Berth Regulation that are outside the scope of EPA's scope of review 
of California authorization requests under section 209(e)(2).
    First, PMSA asserts that California's regulation is arbitrary and 
capricious under section 209 of the Clean Air Act. To that end, PMSA 
asserts that California's At-Berth Regulation is discriminatory in its 
application to types of vessels without regard to the frequency with 
which those vessels visit California ports, and in its advantage 
towards vessels already equipped with shore power connections. PMSA 
first presented these comments to CARB in its rulemaking, and CARB 
answered these comments directly. CARB disagreed that the At-Berth 
Regulation is discriminatory, arbitrary and capricious.\41\ CARB 
further stated that it intends to develop regulations to reduce at-
berth emissions from all ship categories, but in this first regulation 
it has targeted emissions from three ship categories.
---------------------------------------------------------------------------

    \41\ CARB FSOR at 87.
---------------------------------------------------------------------------

    In response to these comments from PMSA, EPA again notes its 
limited review of California's request under section 209, which only 
includes the three criteria listed in section 209(e)(2) for 
California's At-Berth Regulation. PMSA's comment here goes to the 
overall reasonableness of the At-Berth Regulation, and not specifically 
towards any of the section 209(e)(2) criteria. As such, it is outside 
the scope of EPA's authorization evaluation. Additionally, we note that 
these are issues that PMSA already raised in the California rulemaking, 
which CARB considered and responded to with reasoned analysis.
    Second, PMSA asserts that California lacks statutory authority to 
pursue its At-Berth Regulation as an ``In-Use Operations'' regulation 
that requires retrofits. PMSA's point here is that the Equivalent 
Emissions Reduction Option would require retrofits or modifications 
that could affect the stability, structural integrity, and general 
safety of a ship. PMSA believes that such requirements can result in 
impacts that are under the purview of the U.S. Coast Guard, and the 
respective classification societies as designated by a ship's flag 
state. PMSA made this same comment in the California rulemaking, and 
CARB responded.\42\ CARB first answered that the At-Berth Regulation 
does not require vessels to retrofit or perform modifications to ships 
and engines because the regulation is not prescriptive but allows 
flexibility between its two compliance options. Then, CARB pointed out 
that its At-Berth Regulation, section (b)(2), expressly states:
---------------------------------------------------------------------------

    \42\ CARB FSOR at 19.

    Nothing in this section shall be construed to amend, repeal, 
modify, or change in any way any applicable U.S. Coast Guard 
requirements. Any person subject to this section shall be 
responsible for ensuring compliance with both U.S. Coast Guard 
regulations and requirements of this section, including but not 
limited to, obtaining any

[[Page 77521]]

necessary approvals, exemptions, or orders from the U.S. Coast 
Guard.\43\
---------------------------------------------------------------------------

    \43\ At-Berth Regulation section (b)(2), section 93118.3(b)(2), 
title 17, chapter 1, subchapter 7.5, California Code of Regulations, 
EPA-HQ-OAR-2011-0548-0012.

CARB also points out that many vessels already use shore power while 
docked, presumably in compliance with U.S. Coast Guard regulations.
    As above, PMSA's comment here is again outside the scope of EPA's 
section 209(e)(2) evaluation of California's authorization request. EPA 
does not review the general appropriateness of California's 
regulations; nor does EPA's review permit analysis of whether 
California's regulations conflict with areas of Federal law under the 
purview of other agencies. This PMSA comment does not make any attempt 
to show that California's regulations are in conflict with any of the 
criteria in section 209(e)(2). It therefore cannot be the basis for any 
denial of California's request for authorization under section 
209(e)(2).
    Third, PMSA comments that California's At-Berth Regulation's 
``retrofit requirements'' are preempted under section 209(e) of the 
Clean Air Act. This is another issue that PMSA first presented to CARB 
during the California rulemaking. At that time, CARB disagreed.\44\ 
CARB again pointed out that its At-Berth Regulation does not require 
vessel operators to retrofit or modify their engines. CARB further 
pointed out that despite section 209(e)'s preemption, section 209(e)(2) 
allows California to seek authorization to adopt and enforce its 
nonroad engine regulations, which it intended to do and has now done.
---------------------------------------------------------------------------

    \44\ CARB FSOR at 20.
---------------------------------------------------------------------------

    PMSA's comments compare this situation to the one addressed by the 
Supreme Court in United States v. Locke, 529 U.S. 89 (2000). However, 
in this case, unlike in the case of Locke, the statute in question, the 
Clean Air Act, explicitly permits California to promulgate its own 
standards applicable to emissions from marine vessels as long as EPA 
does not make any of the findings required under section 209(e)(2) to 
deny authorization.
    Also, as part of this third general comment, PMSA raises two 
additional issues. First, PMSA raises the issue that EPA's 
authorization would allow other states to adopt the At-Berth 
Regulation, and that it is difficult to envision how other states would 
do so. PMSA is correct that other states may adopt and enforce 
California standards, if such states meet the requirements of section 
209(e)(2)(B) of the Act. While PMSA notes that there may be 
difficulties with other states' adoption of the At-Berth Regulation--
and PMSA has not made it clear that there would be--PMSA makes no 
attempt to explain how this difficulty in any way effects California's 
ability to receive authorization under section 209(e)(2)(A). Second, 
PMSA presents its opposition to California's At-Berth Regulation on the 
basis that ocean-going vessel emissions are an issue of broad concern 
and should be addressed internationally through the International 
Maritime Organization. This comment relates to the broad policy 
considerations affecting California's regulation of vessels, but it 
does not address any of the criteria in section 209(e)(2). It is 
therefore not within the scope of EPA's review under that section.
    As EPA has stated on numerous occasions, sections 209(b) and 209(e) 
of the Clean Air Act limits our authority to deny California requests 
for waivers and authorizations to the three criteria listed therein. As 
a result, EPA has consistently refrained from denying California's 
requests based on any other criteria.\45\ In instances where the U.S. 
Court of Appeals has reviewed EPA decisions declining to deny waiver 
requests based on criteria not found in section 209(b), the Court has 
upheld and agreed with EPA's determination.\46\
---------------------------------------------------------------------------

    \45\ See, e.g., 74 FR 32744, 32783 (July 8, 2009).
    \46\ See Motor and Equipment Manufacturers Ass'n v. Nichols, 142 
F.3d 449, 462-63, 466-67 (DC Cir.1998), Motor and Equipment 
Manufacturers Ass'n v. EPA, 627 F.2d 1095, 1111, 1114-20 (DC Cir. 
1979).
---------------------------------------------------------------------------

    None of the above-described issues PMSA raises is among--or fits 
within the confines of--the criteria listed under sections 209(e).\47\ 
Therefore, in considering California's At-Berth Regulation, EPA cannot 
deny California's request for authorization based on these comments.
---------------------------------------------------------------------------

    \47\ PMSA may raise these issues in a direct challenge to 
California's regulations in other forums, but these issues are not 
relevant to EPA's limited review under section 209(e).
---------------------------------------------------------------------------

E. Authorization Determination for California's At-Berth Regulation

    After a review of the information submitted by CARB and PMSA, EPA 
finds that those opposing California's request have not met the burden 
of demonstrating that authorization for California's At-Berth 
Regulation should be denied based on any of the three statutory 
criteria of section 209(e)(2). For this reason, EPA finds that an 
authorization for California's At-Berth Regulation should be granted.

III. Decision

    The Administrator has delegated the authority to grant California 
section 209(e) authorizations to the Assistant Administrator for Air 
and Radiation. After evaluating California's At-Berth Regulation, 
CARB's submissions, and the public comments from PMSA, EPA is granting 
an authorization to California for its At-Berth Regulation.
    My decision will affect not only persons in California, but also 
entities outside the State who must comply with California's 
requirements. For this reason, I determine and find that this is a 
final action of national applicability for purposes of section 
307(b)(1) of the Act. Pursuant to section 307(b)(1) of the Act, 
judicial review of this final action may be sought only in the United 
States Court of Appeals for the District of Columbia Circuit. Petitions 
for review must be filed by February 13, 2012. Judicial review of this 
final action may not be obtained in subsequent enforcement proceedings, 
pursuant to section 307(b)(2) of the Act.

IV. Statutory and Executive Order Reviews

    As with past authorization and waiver decisions, this action is not 
a rule as defined by Executive Order 12866. Therefore, it is exempt 
from review by the Office of Management and Budget as required for 
rules and regulations by Executive Order 12866.
    In addition, this action is not a rule as defined in the Regulatory 
Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a 
supporting regulatory flexibility analysis addressing the impact of 
this action on small business entities.
    Further, the Congressional Review Act, 5 U.S.C. 801, et seq., as 
added by the Small Business Regulatory Enforcement Fairness Act of 
1996, does not apply because this action is not a rule for purposes of 
5 U.S.C. 804(3).

    Dated: November 28, 2011.
Gina McCarthy,
Assistant Administrator, Office of Air and Radiation.
[FR Doc. 2011-31909 Filed 12-12-11; 8:45 am]
BILLING CODE 6560-50-P