[Federal Register Volume 77, Number 11 (Wednesday, January 18, 2012)]
[Rules and Regulations]
[Pages 2472-2478]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-819]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 1043
[EPA-HQ-OAR-2011-0928; FRL-9618-9]
RIN 2060-XXXX
Great Lakes Steamship Repower Incentive Program
AGENCY: Environmental Protection Agency (EPA).
ACTION: Direct final rule.
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SUMMARY: EPA is taking direct final action to simplify an existing
provision in our marine diesel engine program that is intended to
encourage owners of Great Lakes steamships to repower those steamships
with cleaner marine diesel engines. The simplified program will
automatically permit the use of residual fuel, through December 31,
2025, in a steamship if it has been repowered with a certified Tier 2
or later marine diesel engine, provided the steamship was operated
exclusively on the Great Lakes and was in service on October 30, 2009.
Steamships are powered by old, inefficient steam boilers. Voluntary
replacement of these boilers with modern fuel-efficient marine diesel
engines will result in reductions of particulate matter and sulfur
oxides, even while the replacement diesel engines are operated on
higher sulfur residual fuel, and will provide human health and welfare
benefits for the people who live in the Great Lakes region. Conversion
to new diesel engines will also result in considerable carbon dioxide
reductions and fuel savings.
DATES: This rule is effective on March 19, 2012 without further notice,
unless EPA receives adverse comment by February 17, 2012. If EPA
receives adverse comment, we will publish a timely withdrawal in the
Federal Register informing the public that the rule will not take
effect.
ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2011-0928, by one of the following methods:
www.regulations.gov: Follow the on-line instructions for
submitting comments.
Email: [email protected].
Fax: (202) 566-9744.
Mail: Environmental Protection Agency, Air Docket, Mail-
code 6102T, 1200 Pennsylvania Ave. NW., Washington, DC 20460.
Hand Delivery: EPA Docket Center (EPA/DC), EPA West, Room
3334, 1301 Constitution Ave. NW., Washington, DC, Attention Docket No.
EPA-HQ-OAR-2010-0928. Such deliveries are only accepted during the
Docket's normal hours of operation, and special arrangements should be
made for deliveries of boxed information.
Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2011-0928. 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 email. 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 email comment
directly to EPA without going through www.regulations.gov your email
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
information about EPA's public docket visit the EPA Docket Center
homepage at http://www.epa.gov/epahome/dockets.htm. For additional
instructions on submitting comments, go to Unit III 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 ``Great Lakes Steamship
Repower Incentive Program'' Docket, EPA/DC, EPA West, Room 3334, 1301
Constitution Ave. NW., Washington, DC. The Public Reading Room is open
from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal
holidays. The telephone number for the Public Reading Room is (202)
566-1744, and the telephone number for the ``Great Lakes Steamship
Repower Incentive Program'' Docket is (202) 566-1742.
FOR FURTHER INFORMATION CONTACT: Jean Marie Revelt, Environmental
Protection Agency, Office of Transportation and Air Quality, Assessment
and Standards Division, 2000 Traverwood Drive, Ann Arbor, Michigan
48105; telephone number: (734) 214-4822; fax number: (734) 214-4816;
email address: [email protected].
SUPPLEMENTARY INFORMATION:
I. Why is EPA using a direct final rule?
EPA is publishing this rule without a prior proposed rule because
we view this as a noncontroversial action and anticipate no adverse
comment. However, in the ``Proposed Rules'' section of today's Federal
Register, we are publishing a separate document that will serve as the
proposed rule to adopt the provisions in this Direct Final Rule if
adverse comments are received on this direct final rule. We will not
institute a second comment period on this action. Any parties
interested in commenting must do so at this time. For further
information about commenting on this rule, see the ADDRESSES section of
this document.
If EPA receives adverse comment, we will publish a timely
withdrawal in the Federal Register informing the public
[[Page 2473]]
that this direct final rule will not take effect. We would address all
public comments in any subsequent final rule based on the proposed
rule.
II. Does this action apply to me?
This action will affect companies that own steamships operating
exclusively on the Great Lakes that were in service on October 30,
2009. The following table gives some examples of entities that may be
affected by this rule; however, since these are only examples, you
should carefully examine the regulations. You may direct questions
regarding the applicability of this action as noted in FOR FURTHER
INFORMATION CONTACT.
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NAICS codes
Category \a\ Examples of potentially regulated entities
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Industry...................................... 483113 Coastal and Great Lakes Freight Transportation.
Industry...................................... 483114 Coastal and Great Lakes Passenger
Transportation.
Industry...................................... 336611 Ship building and repairing.
Industry...................................... 811310 Engine repair, remanufacture, and maintenance.
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\a\ North American Industry Classification System (NAICS).
III. What should I consider as I prepare my comments for EPA?
A. Submitting CBI. Do not submit this information to EPA through
www.regulations.gov or email. Clearly mark the part or all of the
information that you claim to be CBI. For CBI information in a disk or
CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM as
CBI and then identify electronically within the disk or CD-ROM the
specific information that is claimed as CBI. In addition to one
complete version of the comment that includes information claimed as
CBI, a copy of the comment that does not contain the information
claimed as CBI must be submitted for inclusion in the public docket.
Information so marked will not be disclosed except in accordance with
procedures set forth in 40 CFR part 2.
B. Tips for Preparing Your Comments. When submitting comments,
remember to:
Identify the rulemaking by docket number and other
identifying information (subject heading, Federal Register date and
page number).
Follow directions--The agency may ask you to respond to
specific questions or organize comments by referencing a Code of
Federal Regulations (CFR) part or section number.
Explain why you agree or disagree; suggest alternatives
and substitute language for your requested changes.
Describe any assumptions and provide any technical
information and/or data that you used.
If you estimate potential costs or burdens, explain how
you arrived at your estimate in sufficient detail to allow for it to be
reproduced.
Provide specific examples to illustrate your concerns, and
suggest alternatives.
Explain your views as clearly as possible, avoiding the
use of profanity or personal threats.
Make sure to submit your comments by the comment period
deadline identified.
IV. Summary of Rule
A. Overview
EPA's final rule for Category 3 marine engines \1\ and their fuels
(75 FR 22896, April 30, 2010) exempted steamships from the sulfur
limits that apply to fuel used in ships operating on the Great Lakes
\2\ beginning August 1, 2012 (40 CFR 1043.95(a)). This means steamships
can continue to operate indefinitely on high sulfur residual fuel.
However, because steamship engines have high emissions and low fuel
efficiency, we included a provision to encourage owners of Great Lakes
steamships to voluntarily replace their steam boilers with cleaner,
more fuel-efficient marine diesel engines (40 CFR 1043.95(b)(4)(iv)).
The current voluntary repower incentive is in the form of relief
through EPA's economic hardship program, through which an owner may
apply for a relaxation of the Great Lakes fuel sulfur limits for fuel
used by the repowered diesel ship, for a defined period of time. The
use of lower price, higher sulfur residual fuel can help offset vessel
repower costs.
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\1\ Category 3 marine engines are diesel engines with per
cylinder displacement at or above 30 liters.
\2\ For the purpose of this program, ``Great Lakes'' means all
the streams, rivers, lakes, and other bodies of water that are
within the drainage basin of the St. Lawrence River, west of
Anticosti Island. (40 CFR 1043.20).
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EPA believes that the goal of repowering the fleet of Great Lakes
steamships will be achieved more effectively by adding a new incentive
program to provide an automatic, time-limited fuel waiver for repowered
steamships. Instead of applying for relief through the economic
hardship program, Great Lakes steamship owners who voluntarily repower
their steamships with diesel engines would automatically qualify for a
waiver that will allow the use of residual fuel in the replacement
diesel engines that exceeds the global and ECA sulfur limits that
otherwise apply to the fuel used in marine diesel engines operated on
the U. S. portions of the Great Lakes. This automatic Great Lakes
steamship repower fuel waiver will be valid through December 31, 2025;
after that date, repowered steamships will be required to comply with
the Great Lakes ECA fuel sulfur limits for diesel engines.\3\ To
qualify for this automatic fuel sulfur waiver, the steamship must be
exempt from existing requirements pursuant to 40 CFR 1043.95(a) in that
it must operate exclusively on the Great Lakes and must have been in
service on October 30, 2009. In addition, the replacement engine must
be a Tier 2 or cleaner marine diesel engine as specified in 40 CFR
1042.104.
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\3\ Compliance can be through switching to ECA-compliant fuel or
through the installation and use of an exhaust gas cleaning system
(scrubber) or other technology or procedure that achieves equivalent
sulfur emissions. See Section V.C of the preamble for our Category 3
FRM for a discussion of compliance strategies.
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Voluntary replacement of steam engines with cleaner, more efficient
Tier 2 or better marine diesel engines through this modification to our
steamship repower incentive program will provide important air quality
and energy benefits immediately, due to the improved fuel efficiency of
the diesel engines, and even larger benefits in the long term, when the
repowered ships will use fuel that complies with the 1,000 ppm sulfur
limit on the Great Lakes.
B. Background
The Great Lakes and St. Lawrence Seaway are the longest deep draft
navigation system in the world. About 160 million tons of cargo is
moved each year through the 110 ports located on this 2,300 mile
system, which extends from the Gulf of St. Lawrence to the western
shores of Lake Superior. According to a recent study, this
[[Page 2474]]
transportation system generated nearly 93,000 directly-related jobs and
134,000 indirect jobs in the U.S. and Canada in 2010, providing about
$34.5 billion in business revenue.\4\
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\4\ The Economic Impacts of the Great Lakes-St. Lawrence Seaway
System. Martin Associates. October 18. 2011. A copy of this report
can be found at http://www.marinedelivers.com/economy.
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The U.S. Great Lakes fleet consists of 57 vessels that carry about
65 percent of Great Lakes cargo.\5\ This fleet is ``captive,'' meaning
that many of these ships operate solely on the Great Lakes. For some
ships, this is because they are too large to pass through the Welland
Canal to the St. Lawrence Seaway; others service only Great Lakes
ports. Operation in fresh water minimizes hull corrosion and therefore
these captive cargo ships remain in service for a long time. The
average age of the fleet of all U.S. cargo vessels operating on the
Great Lakes today is about 44 years. The Canadian fleet of 96 ships
carries about 25 percent of Great Lakes cargo. This fleet is different
from the U.S. fleet in that the ships are younger, on average 35 years,
tend to be smaller, and are more likely to operate in the brackish
water of the lower end of the St. Lawrence Seaway, the Gulf of St.
Lawrence, and the Atlantic Ocean. The remaining Great Lakes cargo is
carried by foreign ocean-ships operating on the system temporarily.
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\5\ Data in this section derived from Greenwoods Guide to Great
Lakes Shipping 2010 (Harbor House Publishing, 2010), Lake Carriers'
Association, the Canadian Shipowners Association, and the St.
Lawrence Seaway Management Corporation. See http://www.lcaships.com/TONPAGE.HTM, http://www.shipowners.ca/index.php?page=annual-report-and-statistics, and http://www.seaway.ca/en/seaway/facts/traffic/index.html.
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Steamships are the oldest segment of the Great Lakes fleet. There
are thirteen U.S. steamships operating on the Great Lakes; twelve of
these have boilers burning residual fuel oil and the thirteenth
operates on coal. The average age of these steamships is about 58
years, the youngest being built in 1960 and the oldest in 1942. The
average age of the smaller fleet of 6 Canadian steamships is 57 years,
with the youngest built in 1967. Because they operate primarily in
fresh water, the U.S. steamships do not experience the corrosion of
saltwater and are expected to remain in operation for several more
decades.
Steamships remaining in operation today, on both the Great Lakes
and the ocean, are part of a legacy fleet that uses technology
originally developed before the diesel engine became the dominant ship
propulsion method worldwide. In steam technology engines, residual fuel
or coal is burned to heat water in a boiler; the resulting steam is
converted into energy to rotate the ship's main propellers. Steam
engines are less efficient than internal combustion engines and can use
30 to 50 percent more fuel than a diesel engine. This translates to
high sulfur oxide (SOX) and particulate matter (PM)
emissions. As discussed in our Category 3 marine rule, these emissions
have important impacts on human health and the environment.
Steamships that operate in salt water are retired from service as a
result of hull corrosion, and much of today's fleet of ocean steamships
is expected to be retired by 2020. Owners choose diesel engines for the
replacement vessels because of their better fuel efficiency and
performance characteristics; diesel engines have lower SOx and PM
emissions as well. Increasing fuel prices have led some Great Lakes
steamship owners to carry out repower projects to replace their
inefficient steam engines with cleaner fuel-efficient diesel engines.
This type of vessel modification can be expensive, with costs of $15 to
$25 million or more (20 to 25 percent of the cost of a new vessel),
because the steam engine is an integral part of the vessel and the hull
must be cut away to remove it. Repowering also requires extensive
engine room and propeller modifications. However, the fuel savings
associated with a 30 percent improvement in fuel efficiency combined
with the long service life of Great Lakes ships helps the owner recover
these costs. The fuel savings can make repowering attractive to owners
on a long-term basis, and several Great Lakes steamships were repowered
in the last decade, including the Paul R. Tregurtha, the Charles M.
Beeghly (now the James L. Oberstar), the Michipicoten, and the Saginaw.
This dynamic was changed, however, with the designation of the North
American Emission Control Area (ECA) and the application of the
stringent ECA fuel sulfur limits to the Great Lakes through our
Category 3 marine rule. As explained below, ECA-compliant fuel is
expected to be higher price distillate fuel, and steamship owners may
not be able to recover the cost of a repower even with the better fuel
efficiency of diesel engines compared to steam engines. As a result,
the incentives for repowering any one of the thirteen remaining
steamships became less compelling.
C. EPA's Coordinated Strategy for Ships and Steamship Repowers
In our 2010 Category 3 marine rulemaking, EPA adopted a Coordinated
Strategy for ships that will reduce emissions from all foreign and
domestic vessels that affect U.S. air quality. The Coordinated Strategy
applies to all ships that operate in the United States, including those
that operate on the U.S. portions of the Great Lakes and St. Lawrence
Seaway. The Coordinated Strategy consists of three parts:
(i) Addition of new tiers of Clean Air Act (CAA) emission standards
that apply to Category 3 marine engines installed on U.S. vessels, and
certain compliance requirements that are consistent with our regulatory
program for Category 1 and Category 2 marine engines;
(ii) Designation of U.S. coastal waters as an Emission Control Area
(ECA) through amendment to Annex VI of the International Convention for
the Prevention of Pollution from Ships (MARPOL Annex VI); ships
operating in a designated ECA are required to meet the most stringent
engine and marine fuel sulfur requirements contained in MARPOL Annex
VI; and
(iii) Adoption of the engine emission and fuel sulfur limits
contained in the amendments to MARPOL Annex VI that are applicable to
all vessels regardless of flag and implementation of those requirements
in the U.S. through the Act to Prevent Pollution from Ships (APPS) and
regulations issued under APPS.
The North American ECA was designated through amendment to MARPOL
Annex VI that was adopted by the Parties to Annex VI in March 2010.\6\
A fuel sulfur limit of 10,000 ppm will begin to apply in this
designated ECA starting in August 2012; this is reduced to 1,000 ppm
beginning January 1, 2015.\7\
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\6\ MEPC.1/Circ.723, 13 May 2010. Information on North American
Emission Control Area (ECA) Under MARPOL Annex VI. A copy of this
document can be found at http://www.epa.gov/otaq/regs/nonroad/marine/ci/mepc1-circ-re-na-eca.pdf.
\7\ See http://www.epa.gov/otaq/fuels/dieselfuels/documents/420b11002.pdf for a summary of the EPA and MARPOL Annex VI fuel
sulfur limits and their effective dates.
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Our 2010 Category 3 marine rulemaking finalized regulations
implementing the MARPOL Annex VI and North American ECA requirements
for U.S. vessels under the CAA and for U.S. and foreign vessels under
APPS. That rule also adopted regulatory text to clarify that vessels
operating in U.S. internal waters, shoreward of an ECA, that can be
accessed by ocean-going vessels must meet the MARPOL Annex VI ECA
requirements. This includes ports and internal waters such as the Great
Lakes. In the regulatory text we refer to the internal waters in which
we are applying the ECA requirements as
[[Page 2475]]
the ``ECA associated area.'' The regulatory text applies the ECA
requirements for these internal waters beginning at the same time as
the ECA takes effect under MARPOL Annex VI.
We received many comments from Great Lakes stakeholders during our
Category 3 rulemaking process about the application of the ECA
standards to the Great Lakes. Steamship owners raised technical and
safety issues associated with operating Great Lakes steamships on
distillate fuel, since these steamships were designed specifically to
operate on residual fuel oils. In response to these comments, we
considered a number of options to address the safety concerns for these
vessels. However, Congress placed a prohibition on EPA's use of funds
to issue a final rule that included fuel sulfur standards applicable to
existing steamships that operate exclusively in the Great Lakes.
Therefore, under our APPS section 1903 authority to ``prescribe any
necessary or desired regulations to carry out the provisions'' of
MARPOL Annex VI, our final regulations exclude Great Lakes steamships
from the final fuel sulfur requirements (40 CFR 1043.95(a)). This means
that steamships can continue to use high sulfur residual fuel
indefinitely.\8\
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\8\ Steamships operated in the coastal areas of the North
American ECA are exempt from the fuel sulfur requirements through
December 31, 2019, by amendment to MARPOL Annex VI. See MEPC 62/24,
Annex 14, page 4 (July 26, 2011). These ships are expected to be
retired from service as of that date as a result of hull corrosion
from operating in salt water.
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At the same time, however, we recognized that the steamship fuel
sulfur exemption, combined with the application of ECA fuel sulfur
requirements to diesel ships operating on the Great Lakes, would reduce
the incentives for steamship owners to repower their ships. This is
because once the steamship is repowered with diesel engines it would no
longer be exempt from the fuel sulfur requirements. In addition, the
higher price of fuel that is compliant with ECA and global fuel
requirements would make it harder to recover the costs of the repower
project through fuel savings from the more fuel efficient diesel
engines.
As a result, we added a provision to our economic hardship waiver
program that would allow EPA to consider ``the ability of an individual
vessel to recover capital investments incurred to repower or otherwise
modify a vessel to reduce air emissions'' (40 CFR 1043.95(b)(4)(iv)).
Using this provision, EPA intended that steamship owners who
voluntarily repower their steamships with diesel engines could apply
for an economic hardship waiver that would allow the ship to use lower-
price residual fuel in the repowered diesel engine for a specified
period of time, which can help offset the capital costs of a repower
project.
Since EPA finalized the Category 3 marine rule, we recognized that
the goal of encouraging voluntary Great Lakes steamship repowers can be
achieved more effectively by providing an automatic fuel sulfur waiver
for a defined period of time for Great Lakes steamships that are
repowered with a Tier 2 or better diesel engine.\9\
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\9\ In certain cases EPA may approve the use of an engine that
meets a less stringent tier of standards, if the owner can
demonstrate that the engine was purchased for a steamship repower
prior to October 30, 2009 and it meets the criteria set out in the
regulations.
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A waiver is appropriate and reasonable due to the significant
emissions and energy benefits from repowering a steamship with a diesel
engine, both immediately and in the long run. A diesel engine is 30 to
50 percent more fuel-efficient than a steam power plant, due to better
combustion technology. In a typical steamship, replacing the steam
power plant with a diesel engine will immediately reduce SOX
emissions by about 34 percent; PM emissions would be about the same for
both engines when operating on high sulfur residual fuel. In the long
term, beginning January 1, 2026 when the replacement diesel engines
will be required to use fuel that complies with the 1,000 ppm sulfur
limit on the Great Lakes, the estimated emission reductions will be
even more significant: About 97 percent reduction in SOX and
about 84 percent reduction in PM emissions compared to the steam
engine. These SOX and PM emission reductions are
extraordinary, especially given that Great Lakes steamships, repowered
or not, will have many years of service life remaining even after the
expiration of the fuel sulfur waiver. Steam engines have inherently low
NOX emissions due to their inefficient combustion process,
and replacing a steam engine with a diesel engine may result in several
times more NOX emissions. However, the diesel marine engines
that would replace the steam engine have NOX emissions
comparable to diesel engines used in other marine and land-based
applications, and would be required to meet at least EPA's Tier 2
standards. In addition, the health and human welfare benefits of
reducing PM and SOX emissions overwhelm the impacts of the
NOX emission increase of the repowered engine compared to
the original steam engine. Therefore, the impacts of repowering Great
Lakes steamships are expected to be significantly beneficial.
An automatic waiver is appropriate because it will give owners
greater flexibility with regard to how and when they repower. A ship
repower is a lengthy process that requires significant redesign of the
ship engine room and propulsion system. Also, the scheduling of dry
dock time must be timed with the order and delivery of the replacement
engine and other important ship components. An automatic waiver will
avoid an additional review and approval phase for a repower project. It
also may facilitate financing as the waiver is available for any
qualifying steamship repower.
Consistent with our existing steamship fuel sulfur waiver (40 CFR
1043.95(a)), this steamship incentive program fuel waiver is available
only to steamships that were operating exclusively on the Great Lakes
and that were in service on October 30, 2009 \10\ and therefore are
otherwise exempt from the requirements of Part 1043. In addition, the
steam engine must be replaced with an engine that meets the EPA
standards in effect at the time the ship will enter dry dock (i.e., it
is covered by an EPA-issued certificate of conformity).
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\10\ ``In service'' means operating as a steamship, but is not
limited to actually performing that service on that day.
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To qualify for this steamship repower waiver, the vessel must
remain intact in that the cargo section of the vessel must remain
connected to the section that contains the pilothouse. This means that
if a steamship is converted to a barge and is subsequently paired,
either permanently or sporadically, with a tug, the tug will not
qualify for this fuel sulfur waiver. Removal of the engine section of
the vessel and replacing it with a tug is more consistent with
replacing the existing vessel rather than repowering it. In addition,
the replacement tug would likely be powered by a Category 2 engine that
does not use residual fuel, due to the space restrictions on tugs and
the requirements for fuel handling equipment to use residual fuel, and
therefore a residual fuel waiver would be irrelevant.
The waiver is valid through December 31, 2025. Beginning January 1,
2026, the owner will be required to use ECA-compliant fuel in the
repowered diesel engine. This limited waiver period is intended to
encourage steamship owners to repower early to take full advantage of
the amount of time they can use lower price residual fuel. This,
[[Page 2476]]
in turn, will maximize the human health and environmental benefits of
the steamship repower waiver.
A steamship owner taking advantage of the automatic steamship
repower incentive program is required to notify EPA's designated
certification officer of the intention to use this provision. The
notification must include a description of the project, the expected
timeline, and other relevant information. The owner is also required to
notify EPA's designated certification officer at completion of the
project. At that time, EPA will provide the owner with a statement that
the repowered ship is covered by the steamship repower incentive
program fuel sulfur waiver. This document should be kept with the
ship's International Air Pollution Prevention (IAPP) and Engine
International Air Pollution Prevention (EIAPP) certificates, for
compliance purposes.
The owner of the repowered steamship is required to comply with all
other aspects of EPA's marine diesel engine program, including the
MARPOL Annex VI requirements with respect to bunker delivery notes.
EPA has determined that no changes are needed to our 40 CFR part 80
fuels program to effectuate the fuel sulfur waiver for repowered
steamships. This is because the prohibitions contained in 40 CFR 80.610
specify that ``no person shall * * * (6) beginning January 1, 2015,
introduce (or permit the introduction of) any fuel with a sulfur
content greater than 1,000 ppm for use in a Category 3 marine vessel
within an ECA, except as allowed by 40 CFR part 1043,'' and the
steamship repower incentive program regulations will be part of 40 CFR
1043.95. In addition, ECA fuel is defined in 40 CFR 80.2(ttt)(2)(i) as
excluding ``fuel that is allowed by 40 CFR part 1043 to exceed the fuel
sulfur limits for operation in an ECA (such as fuel used by excluded
vessels * * *).''
D. Regulatory Action
Under the authority of 33 U.S.C. 1903 to ``prescribe any necessary
or desired regulations to carry out the provisions'' of MARPOL Annex
VI, EPA is taking direct final action to add an automatic fuel sulfur
waiver to our marine diesel program for repowered steamships operating
on the Great Lakes. This automatic fuel waiver is available only to
owners of steamships that operate exclusively on the Great Lakes and
that were in service on October 30, 2009, where ``in service'' means
operating as a steamship, but is not limited to actually performing
that service on that day. This waiver will allow the converted
steamship to use non-compliant residual fuel in the repowered diesel
engine through December 31, 2025.
This action will not have an adverse cost impact on steamship
owners. Steamship owners are not required to replace the steam engines
on their vessels with diesel engines. This direct final rule merely
adds a provision to allow steamship owners who voluntarily repower with
diesel engines to automatically continue to use the fuel they would
otherwise be permitted to use had the ship not been repowered, for a
period of time. This provision will provide important air quality and
energy benefits immediately, due to the improved fuel efficiency of the
diesel engines, and even larger benefits beginning in 2026, when the
repowered ship will use fuel that complies with the 1,000 ppm sulfur
limit on the Great Lakes.
V. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review
This action is not a ``significant regulatory action'' under the
terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is
therefore not subject to review under Executive Orders 12866 and 13563
(76 FR 3821, January 21, 2011). This direct final rule merely adds an
automatic waiver provision to encourage Great Lakes steamship owners to
repower their vessels with cleaner marine diesel engines. There are no
costs associated with this rule because steamship owners are not
required to repower their ships.
B. Paperwork Reduction Act
The information collection requirements in this rule will be
submitted for approval to the Office of Management and Budget (OMB)
under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. The
information collection requirements are not enforceable until OMB
approves them.
The program contained in this rule is a voluntary incentive program
to encourage owners of Great Lakes steamship to repower their ships
with diesel engines. A steamship owner taking advantage of the
automatic fuel waiver is required to notify EPA's designated
certification officer of the intention to use this provision. The
notification must include a description of the project, the expected
timeline, and other relevant information. The owner is also required to
notify EPA's designated certification officer at completion of the
project. The purpose of the reporting is to ensure that a repower has
taken place, with a qualified EPA-certified engine. Because this
program is voluntary, a steamship owner would provide this information
only if the provision is exercised. When the project is completed, EPA
will provide the owner with a statement that the repowered ship is
covered by the steamship repower incentive program fuel sulfur waiver,
which is to be kept onboard for compliance purposes.
There are potentially six companies affected, which own the twelve
remaining diesel steamships that operate on the Great Lakes. It is not
known how many of these companies will actually take advantage of the
waiver, or when they would repower. However, it is likely that the
repowers would occur prior to 2015, to maximize the fuel savings
afforded by the fuel sulfur waiver before it expires on December 31,
2025.
The total estimated burden associated with the automatic steamship
repower incentive program is 14.0 hours annually. This is based on two
steamship owners repowering two steamships in each of three years and
an estimated 3.5 annual labor hours for each manufacturer to prepare
and submit the required information for each ship. Burden is defined at
5 CFR 1320.3(b).
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in 40 CFR are listed in 40 CFR part 9. When this ICR is
approved by OMB, the Agency will publish a technical amendment to 40
CFR part 9 in the Federal Register to display the OMB control number
for the approved information collection requirements contained in this
final rule.
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency
to prepare a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements under the Administrative
Procedure Act or any other statute unless the agency certifies that the
rule will not have a significant economic impact on a substantial
number of small entities. Small entities include small businesses,
small organizations, and small governmental jurisdictions.
For purposes of assessing the impacts of today's rule on small
entities, small entity is defined as: (1) A small business primarily
engaged in shipbuilding and repairing as defined by NAICS code
[[Page 2477]]
336611 with 1,000 or fewer employees (based on Small Business
Administration size standards); (2) a small business that is primarily
engaged in freight or passenger transportation on the Great Lakes as
defined by NAICS codes 483113 and 483114 with 500 or fewer employees
(based on Small Business Administration size standards); (3) a small
business primarily engaged in commercial and industrial machinery and
equipment repair and maintenance with annual receipts less than $7
million (based on Small Business Administration size standards); (4) a
small governmental jurisdiction that is a government of a city, county,
town, school district or special district with a population of less
than 50,000; and (5) a small organization that is any not-for-profit
enterprise which is independently owned and operated and is not
dominant in its field.
After considering the economic impacts of today's final rule on
small entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities.
In determining whether a rule has a significant economic impact on
a substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analyses is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the rule on small entities.'' 5 U.S.C. 603 and 604.
Thus, an agency may certify that a rule will not have a significant
economic impact on a substantial number of small entities if the rule
relieves regulatory burden, or otherwise has a positive economic effect
on all of the small entities subject to the rule.
This direct final rule merely adds an automatic waiver provision to
encourage Great Lakes steamship owners to repower their vessels with
cleaner marine diesel engines. There are no costs and therefore no
regulatory burden associated with this rule because steamship owners
are not required to repower their ships and can continue using their
vessels indefinitely. This Great Lakes steamship repower incentive
program will assist those steamship owners who choose to voluntarily
repower their ships, however, by allowing them to use lower-price
residual fuel in the repowered diesel ship for a specified period of
time, which may help them cover the costs of the repower project. We
have therefore concluded that today's final rule will not increase
regulatory burden for affected small entities.
D. Unfunded Mandates Reform Act
This action contains no Federal mandates under the provisions of
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C.
1531-1538 for State, local, or tribal governments or the private
sector. The action imposes no enforceable duty on any State, local or
tribal governments or the private sector. Therefore, this action is not
subject to the requirements of sections 202 or 205 of the UMRA.
This action is also not subject to the requirements of section 203
of UMRA because it contains no regulatory requirements that might
significantly or uniquely affect small governments. This direct final
rule merely adds an automatic waiver provision to encourage Great Lakes
steamship owners to repower their vessels with cleaner marine diesel
engines. None of the thirteen U.S. steamships operating on the Great
Lakes as of October 30, 2009, are owned or operated by a State, local,
or tribal government.
E. Executive Order 13132: Federalism
This action does not have federalism implications. It will not have
substantial direct effects on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government, as
specified in Executive Order 13132. This direct final rule merely adds
an automatic waiver provision to encourage Great Lakes steamship owners
to repower their vessels with cleaner marine diesel engines. None of
the thirteen U.S. steamships operating on the Great Lakes as of October
30, 2009, are owned or operated by a State. Thus, Executive Order 13132
does not apply to this action.
F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
This action does not have tribal implications, as specified in
Executive Order 13175 (65 FR 67249, November 9, 2000). This direct
final rule merely adds an automatic waiver provision to encourage Great
Lakes steamship owners to repower their vessels with cleaner marine
diesel engines. None of the thirteen U.S. steamships operating on the
Great Lakes as of October 30, 2009, are owned or operated by an Indian
tribal government. Thus, Executive Order 13175 does not apply to this
action.
G. Executive Order 13045: Protection of Children From Environmental
Health and Safety Risks
This action is not subject to Executive Order 13045 (62 FR 19885,
April 23, 1997) because it is not economically significant as defined
in Executive Order 12866, and because the Agency does not believe the
environmental health or safety risks addressed by this action present a
disproportionate risk to children. This direct final rule merely adds
an automatic waiver provision to encourage Great Lakes steamship owners
to repower their vessels with cleaner marine diesel engines. To the
extent Great Lakes steamship owners take advantage of this incentive
program, their action will provide immediate air quality and energy
benefits, due to the improved fuel efficiency of the diesel engines,
and even larger benefits in the long term, when the repowered ship will
use fuel that complies with the 1,000 ppm sulfur limit on the Great
Lakes. These emission reductions will improve air quality for all
people who live in the Great Lakes region, including children and other
sensitive populations.
H. Executive Order 13211: Actions That Significantly Affect Energy
Supply, Distribution, or Use
This action is not subject to Executive Order 13211 (66 FR 28355,
May 22, 2001), because it is not a significant regulatory action under
Executive Order 12866.
I. National Technology Transfer Advancement Act
Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note)
directs EPA to use voluntary consensus standards in its regulatory
activities unless to do so would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., materials specifications, test methods, sampling
procedures, and business practices) that are developed or adopted by
voluntary consensus standards bodies. NTTAA directs EPA to provide
Congress, through OMB, explanations when the Agency decides not to use
available and applicable voluntary consensus standards.
This action does not involve technical standards. Therefore, EPA
did not consider the use of any voluntary consensus standards.
[[Page 2478]]
J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations
Executive Order 12898 (59 FR 7629, Feb. 16, 1994) establishes
federal executive policy on environmental justice. Its main provision
directs federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
EPA has determined that this final rule will not have
disproportionately high and adverse human health or environmental
effects on minority or low-income populations because it increases the
level of environmental protection for all affected populations without
having any disproportionately high and adverse human health or
environmental effects on any population, including any minority or low-
income population. This direct final rule merely adds an automatic
waiver provision to encourage Great Lakes steamship owners to repower
their vessels with cleaner marine diesel engines. To the extent Great
Lakes steamship owners take advantage of this incentive program, their
action will provide immediate air quality and energy benefits, due to
the improved fuel efficiency of the diesel engines, and even larger
benefits in the long term, when the repowered ship will use fuel that
complies with the 1,000 ppm sulfur limit on the Great Lakes. These
emission reductions will improve air quality for all people who live in
the Great Lakes region, including minority and low-income populations.
K. Congressional Review Act
The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this rule and other
required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A Major rule cannot
take effect until 60 days after it is published in the Federal
Register. This action is not a ``major rule'' as defined by 5 U.S.C.
804(2). This rule will be effective on March 19, 2012.
L. Statutory Authority
The statutory authority for this action comes from section 1903 of
the Act to Prevent Pollution from Ships (33 U.S.C. 1901 et seq.). The
Act to Prevent Pollution from Ships implements Annex VI to the
International Convention for the Prevention of Pollution from Ships
(MARPOL) and makes those requirements enforceable domestically. Section
1903 gives the Administrator the authority to prescribe any necessary
or desired regulations to carry out the provisions of Regulations 12
through 19 of MARPOL Annex VI.
List of Subjects in 40 CFR Part 1043
Environmental protection, Administrative practice and procedure,
Air pollution control, Confidential business information, Economic
hardship waiver, Great Lakes, North American Emission Control Area,
Reporting and recordkeeping requirements, Steamships.
Dated: January 11, 2012.
Lisa P. Jackson,
Administrator.
For the reasons set out in the preamble, Title 40, Chapter I of the
Code of Federal Regulations is amended as follows:
PART 1043--CONTROL OF NOX, SOX, AND PM EMISSIONS FROM MARINE
ENGINES AND VESSELS SUBJECT TO THE MARPOL PROTOCOL
0
1. The authority citation for part 1043 continues to read as follows:
Authority: 33 U.S.C. 1901-1915.
0
2. Section 1043.95 is amended by redesignating paragraphs (b) and (c)
as paragraphs (c) and (d), respectively, and adding a new paragraph (b)
to read as follows:
Sec. 1043.95 Interim provisions.
* * * * *
(b) The fuel-use requirements of this part do not apply through
December 31, 2025, for a ship qualifying under paragraph (a) of this
section if it was in service as a steamship on October 30, 2009 and it
is repowered with one or more marine diesel engines, subject to the
following conditions and requirements:
(1) Engines must meet exhaust emission standards using one of the
following approaches:
(i) All the installed replacement engines must be certified to
applicable standards under 40 CFR part 1042 based on the date the
vessel enters dry dock for service.
(ii) We may approve the use of an engine meeting less stringent
standards if the owner can demonstrate that it took possession of the
engine before October 30, 2009, and that engine is a new engine that
has not been installed in a non-marine application. Such an engine must
at a minimum be certified to the Annex VI NOX emission
standard in Sec. 1043.60 that applies based on its build date.
(2) The vessel owner must notify us regarding the intent to use
this provision. The notification must include a description of the
vessel and a summary of the project, including the expected timeline,
and other relevant information.
(3) The vessel owner must notify the Designated Certification
Officer when the project is complete. We will send the owner a
statement that the repowered ship is exempt from fuel sulfur
requirements through December 31, 2025; this statement must be kept
onboard the vessel for compliance purposes.
(4) All other requirements under this part 1043 continue to apply,
including requirements related to bunker delivery notes.
(5) This paragraph (b) applies only for vessels whose hull remains
intact through the repowering process. For example, if a steamship is
converted to a barge for use with tugboats, those vessels must use fuel
meeting the requirements of this part 1043.
* * * * *
[FR Doc. 2012-819 Filed 1-17-12; 8:45 am]
BILLING CODE 6560-50-P