[Federal Register Volume 77, Number 25 (Tuesday, February 7, 2012)]
[Rules and Regulations]
[Pages 6016-6019]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-2601]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2010-0483-201201; FRL-9627-5]


Approval and Promulgation of Implementation Plans; State of 
Tennessee: Prevention of Significant Deterioration and Nonattainment 
New Source Review Rules: Nitrogen Oxides as a Precursor to Ozone

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is taking final action to approve changes to the Tennessee 
State Implementation Plan (SIP), submitted by the Tennessee Department 
of Environment and Conservation (TDEC), through the Division of Air 
Pollution Control, to EPA on May 28, 2009. The SIP revision modifies 
Tennessee's New Source Review (NSR) Prevention of Significant 
Deterioration (PSD) and Nonattainment New Source Review (NNSR) 
programs. The SIP revision addresses three related issues. First, the 
SIP revision updates Tennessee's SIP-approved regulations to 
incorporate NSR permitting requirements promulgated in the 1997 8-Hour 
Ozone national ambient air quality standards (NAAQS) Implementation 
Rule NSR Update Phase II (hereafter referred to as the ``Ozone 
Implementation NSR Update'' or ``Phase II Rule''). Second, Tennessee's 
May 28, 2009, SIP revision updates to Tennessee's PSD and NNSR 
permitting regulations regarding the addition of clean coal technology 
(CCT) provisions. Third, the SIP revision provides clarifying changes 
and corrections to portions of the Tennessee NSR rule. All changes in 
the SIP revision comply with federal NSR permitting regulations found 
at 40 CFR 51.165 and 51.166. EPA is approving Tennessee's May 28, 2009, 
SIP revision because it is in accordance with the Clean Air Act (CAA or 
Act).

DATES: Effective Date: This rule will be effective March 8, 2012.

ADDRESSES: EPA has established a docket for this action under Docket 
Identification No. EPA-R04-OAR-2010-0483. All documents in the docket 
are listed on the www.regulations.gov web site. Although listed in the 
index, some information is not publicly available, i.e., Confidential 
Business Information or other information whose disclosure is 
restricted by statute. Certain other material, such as copyrighted 
material, is not placed on the Internet and will be publicly available 
only in hard copy form. Publicly available docket materials are 
available either electronically through www.regulations.gov or in hard 
copy at the Regulatory Development Section, Air Planning Branch, Air, 
Pesticides and Toxics Management Division, U.S. Environmental 
Protection Agency, Region 4, 61 Forsyth Street SW., Atlanta, Georgia 
30303-8960. EPA requests that if at all possible, you contact the 
person listed in the FOR FURTHER INFORMATION CONTACT section to 
schedule your inspection. The Regional Office's official hours of 
business are Monday through Friday, 8:30 to 4:30, excluding federal 
holidays.

FOR FURTHER INFORMATION CONTACT: For information regarding the 
Tennessee SIP, contact Ms. Twunjala Bradley, Regulatory Development 
Section, Air Planning Branch, Air, Pesticides and Toxics Management 
Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth 
Street SW., Atlanta, Georgia 30303-8960. Telephone number: (404) 562-
9352; email address: [email protected]. For information 
regarding NSR, contact Ms. Yolanda Adams, Air Permits Section, at the 
same address above. Telephone number: (404) 562-9214; email address: 
[email protected]. For information regarding 8-hour ozone NAAQS, 
contact Ms. Jane Spann, Regulatory Development Section, at the same 
address above. Telephone number: (404) 562-9029; email address: 
[email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Background
II. This Action
III. Final Action
IV. Statutory and Executive Order Reviews

I. Background

    EPA is taking final action to approve changes to the Tennessee SIP 
such that it is consistent with federal requirements for NSR 
permitting.\1\ On May 28, 2009, Tennessee submitted a SIP revision to 
EPA for approval which revised Tennessee's Air Quality Regulations, 
Chapter 1200-3-9--Construction and Operating Permits, Rule Number .01--
Construction Permit, .02--Operating Permits, and .03--General 
Provisions to adopt federal PSD and NNSR requirements.\2\ First, the 
SIP revision addressed requirements promulgated in the Phase II Rule 
including the following provisions: (1) Recognizing nitrogen oxides 
(NOX) emissions as ozone precursors; (2) adopting NNSR 
provisions for major stationary source thresholds for sources in 
certain classes of nonattainment areas for 8-hour ozone, carbon 
monoxide and particulate matter with a nominal aerodynamic diameter 
less than or equal to 10 microns (PM10); (3) addressing 
changes to offset ratios for marginal, moderate, serious, severe, and 
extreme ozone nonattainment areas; and (4) modifying provisions 
addressing offset requirements for facilities that shut down or curtail 
operation. Second, the SIP revision includes updates to the Tennessee 
PSD and NNSR permitting regulations regarding the adoption of CCT 
definitions at 1200-3-9. Lastly, the SIP revision includes clarifying 
changes and corrections to the State's rules at 1200-3-9-.01 through 
-.03.
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    \1\ Tennessee's May 28, 2009, SIP revision also contained 
changes to Tennessee's SIP-approved NSR permitting regulations 
regarding ``baseline actual emissions.'' At this time, EPA is not 
taking action on this portion of Tennessee's submission.
    \2\ Tennessee's May 28, 2009, SIP submittal also made changes to 
the State's title V regulations at 1200-3-9-.02(11). EPA is not 
taking action on Tennessee's revisions to the State's title V 
regulations at this time.
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    EPA notes that Tennessee's May 28, 2009, submittal also includes 
the removal of provisions for clean units (CU) and pollution control 
projects (PCP) from the State's PSD and NNSR regulations that were 
submitted by the State to be consistent with then-applicable federal 
regulations. EPA did

[[Page 6017]]

not take action to approve these CU and PCP revisions into Tennessee's 
federally-approved SIP, and the federal requirement for these 
provisions was ultimately vacated by the United States Court of Appeals 
for the District of Columbia Circuit (DC Circuit Court) \3\ 
Consequently, because these revisions were never incorporated into the 
State's SIP and the federal requirements have since been vacated, there 
is no federal action necessary with respect to the removal of the CU 
and PCP provisions from State law.
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    \3\ On December 31, 2002, (67 FR 80186), EPA published final 
rule changes to 40 CFR parts 51 and 52, regarding the CAA's PSD and 
NNSR programs. On November 7, 2003, (68 FR 63021), EPA published a 
notice of final action on the reconsideration of the December 31, 
2002, final rule changes. The December 31, 2002, and the November 7, 
2003, final actions are collectively referred to as the ``2002 NSR 
Reform Rules.'' On June 24, 2005, the DC Circuit Court vacated 
portions of the 2002 NSR Reform Rules pertaining to CU and PCP.
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    On December 5, 2011, EPA published a proposed rulemaking to approve 
the aforementioned changes to Tennessee's NSR programs. See 76 FR 
75845. No comments, adverse or otherwise, were received on EPA's 
December 5, 2011, proposed rulemaking. EPA is now taking final action 
to approve the changes to Tennessee's NSR programs as provided in EPA's 
December 5, 2011, proposed rulemaking. A summary of the background for 
today's final actions is provided below.

a. Phase II Rule

    With regard to the 1997 8-hour ozone NAAQS,\4\ EPA's Phase II Rule, 
finalized on November 29, 2005, addressed control and planning 
requirements as they applied to areas designated nonattainment for the 
1997 8-hour ozone NAAQS such as reasonably available control 
technology, reasonably available control measures, reasonable further 
progress, modeling and attainment demonstrations, NSR, and the impact 
to reformulated gas for the 1997 8-hour ozone NAAQS transition. See 70 
FR 71612. The NSR permitting requirements established in the rule 
included the following provisions: recognizing NOx as an 
ozone precursor for PSD purposes; changes to the NNSR rules 
establishing major stationary thresholds (marginal, moderate, serious, 
severe, and extreme nonattainment (NAA) classifications) and 
significant emission rates for the 8-hour ozone, PM10 and 
carbon monoxide NAAQS; revising the criteria for crediting emission 
reductions credits from operation shutdowns and curtailments as 
offsets, and changes to offset ratios for marginal, moderate, serious, 
severe, and extreme ozone NAA.
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    \4\ On July 18, 1997, EPA promulgated a revised 8-hour ozone 
NAAQS of 0.08 parts per million--also referred to as the 1997 8-hour 
ozone NAAQS. On April 30, 2004, EPA designated areas as 
unclassifiable/attainment, nonattainment and unclassifiable for the 
1997 8-hour ozone NAAQS. In addition, on April 30, 2004, as part of 
the framework to implement the 1997 8-hour ozone NAAQS, EPA 
promulgated an implementation rule in two phases (Phase I and II). 
The Phase I Rule (effective on June 15, 2004), provided the 
implementation requirements for designating areas under subpart 1 
and subpart 2 of the CAA. See 69 FR 23951.
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    The Phase II Rule made changes to federal regulations at 40 CFR 
51.165 and 51.166 (which govern the NNSR and PSD permitting programs 
respectively). Pursuant to these requirements, states were required to 
submit SIP revisions adopting the relevant federal requirements of the 
Phase II Rule (at 40 CFR 51.165 and 51.166) into their SIP no later 
than June 15, 2007. Tennessee's May 28, 2009, SIP revision adopts the 
relevant provisions at 40 CFR 51.165 and 51.66 into the Tennessee SIP 
to be consistent with federal regulations for NSR permitting 
requirements promulgated in the Phase II Rule with minor NNSR 
variations. States may meet the requirements of 40 CFR Part 51 and the 
Phase II Rules with alternative but equivalent regulations. As part of 
its analysis of Tennessee's May 28, 2009 SIP revision, EPA conducted a 
thorough review of the state's submittal including those provisions 
that differ from the federal rules (specifically NNSR provisions at 40 
CFR 51.165(a)(1)(iv)(A)(2), 51.165(a)(1)(v)(E) and 51.165(a)(1)(x)(C)). 
EPA determined that Tennessee's equivalent provisions to the federal 
NNSR regulations are consistent with the program requirements for NSR, 
set forth at 40 CFR 51.165 and 51.166. For more detail on Tennessee's 
equivalent NNSR provisions related to the Phase II Rule, please refer 
to EPA's proposed rulemaking at 76 FR 75845 (December 5, 2011).

b. Clean Coal Technology Revisions

    With regard to the CCT changes, Tennessee's May 28, 2009, SIP 
submittal revised the State's NSR regulations at 1200-3-9 to adopt CCT 
and repowering definitions promulgated by EPA in a portion of the 1992 
WEPCO Rule (Wisconsin Electric Power Co. v. Reilly, 893 F.2d 901 (7th 
Cir. 1990)) on July 21, 1992 (57 FR 32314) and now codified at 40 CFR 
51.165(a)(1)(xxii)-(xxiv) and 51.166(b)(33)-(36). In addition, 
Tennessee's SIP submittal modified the definition of ``major 
modification'' to exempt ``clean coal technology demonstration 
projects'' (consistent with 51.165(a)(1)(v)(C)(9) and 
51.166(b)(2)(iii)(i)-(j)).\5\ EPA has determined that the rule changes 
made by Tennessee are consistent with the current federal regulations 
at 40 CFR 51.165 and 51.166.
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    \5\ The WEPCO rule exempted CCT demonstration projects (that 
constitute re-powering) from PSD requirements (major modification) 
as long as the projects do not cause an increase in potential to 
emit of a regulated NSR pollutant emitted by the unit.
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c. Tennessee's Clarifying Changes and Corrections

    Finally, TDEC's May 28, 2009, SIP submittal incorporated clarifying 
changes and typographical corrections to portions of the State's NSR 
regulations at 1200-3-9-.01 through -.03. Specifically, Tennessee made 
typographical corrections to the definition of ``major stationary 
source'' at rule 1200-3-09-.01(5)(b)1(iv)(II) \6\ by removing the ``s'' 
from the word ``items'' between the word ``under'' and before numerical 
(``iv''). In addition, Tennessee replaced the word ``data'' with 
``date'' at paragraph (1) of rule 1200-3-9-.03. Tennessee's clarifying 
changes also revised paragraph (1) at rule 1200-3-9-.02 to clarify the 
timeframe and conditions for an air contaminant source to apply for an 
operating permit. Finally, as a result of the removal of all references 
to the ``clean units'' language (due to the above-described vacatur), 
Tennessee, where appropriate at Rule 1200-3-9-.01, replaced the terms 
``clean units'' or ``clean'' with the terms ``new emission units'' or 
``new'' consistent with the hybrid test applicability provision amended 
in the 2002 NSR Reform Rule. See 67 FR 8018 at 80260). EPA has 
determined that the clarifying changes and corrections made by 
Tennessee are consistent with section 110 of the CAA and its 
implementing regulations.
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    \6\ EPA notes that in the proposed rule for this action, the 
Agency incorrectly cited Tennessee's definition of ``major 
stationary source'' as ``1200-3-0-.01(5)(b)(i)1(iv)(II)'' instead of 
``1200-3-09-.01(5)(b)1(iv)(II)'' regarding the typographical 
correction. See 76 FR 75845, 75848.
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II. This Action

    Tennessee's May 28, 2009, SIP revision updates the State's PSD and 
NNSR provisions at Chapter 1200-3-9 to adopt the NSR requirements 
promulgated in the Phase II Rule regarding: (1) Recognizing 
NOx emissions as ozone precursors; (2) NNSR provisions for 
major stationary source thresholds for sources in certain classes of 
nonattainment areas for 8-hour ozone, carbon monoxide and 
PM10; (3) addressing changes to offset ratios for marginal, 
moderate, serious, severe, and extreme ozone nonattainment areas;

[[Page 6018]]

and (4) addressing changes to provisions pertaining to offset 
requirements for facilities that shut down or curtail operation. 
Tennessee's SIP submittal also adopted CCT definitions established in a 
portion of the WEPCO Rule (including demonstration project, temporary 
CCT demonstration project, and re-powering found at 40 CFR 
51.165(xxii)-(xxiv) and 51.166(b)(33)-(36)) and revised the definition 
of ``major modification'' by exempting CCT demonstration projects (that 
constitute re-powering) from PSD requirements currently at 40 CFR 
51.165(a)(1)(v)(C)(9) and 51.166(b)(2)(iii)(i)-(j). Additionally, 
Tennessee's SIP submittal made clarifying changes and corrected 
typographical errors at Tennessee NSR regulations in Chapter 1200-3-
9-.01 through -.03.
    EPA has determined that Tennessee's May 28, 2009, SIP revision, 
which became state-effective on May 10, 2009, meets the NSR permitting 
requirements established in the Phase II Rule and is consistent with 
the provisions promulgated in a portion of the WEPCO Rule. Further, EPA 
has determined that Tennessee's May 28, 2009, SIP revision is 
consistent with section 110 of the CAA.

III. Final Action

    Pursuant to section 110 of the CAA, EPA is taking final action to 
approve Tennessee's May 28, 2009, SIP revisions adopting federal 
regulations amended in the Phase II Rule (specifically recognizing 
NOx as an ozone precursor) into the Tennessee SIP. EPA is 
also taking final action to approve Tennessee's changes to its PSD and 
NNSR permitting regulations regarding the addition of CCT requirements 
(established in a portion of EPA's WEPCO Rule) at 1200-3-9.01; and the 
clarifying changes and correction to Tennessee's NSR rule. EPA is 
approving these revisions into the Tennessee SIP because they are 
consistent with section 110 of the CAA and its implementing 
regulations.

IV. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP 
submission that complies with the provisions of the Act and applicable 
Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in 
reviewing SIP submissions, EPA's role is to approve state choices, 
provided that they meet the criteria of the CAA. Accordingly, this 
action merely approves state law as meeting Federal requirements and 
does not impose additional requirements beyond those imposed by state 
law. For that reason, this action:
     Is not a ``significant regulatory action'' subject to 
review by the Office of Management and Budget under Executive Order 
12866 (58 FR 51735, October 4, 1993);
     Does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or 
uniquely affect small governments, as described in the Unfunded 
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have Federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
     Is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the 
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 
note) because application of those requirements would be inconsistent 
with the CAA; and
     Does not provide EPA with the discretionary authority to 
address, as appropriate, disproportionate human health or environmental 
effects, using practicable and legally permissible methods, under 
Executive Order 12898 (59 FR 7629, February 16, 1994).

In addition, this rule does not have tribal implications as specified 
by Executive Order 13175 (65 FR 67249, November 9, 2000), because the 
SIP is not approved to apply in Indian country and EPA notes that it 
will not impose substantial direct costs on tribal governments or 
preempt tribal law.
    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 action and 
other required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2).
    Under section 307(b)(1) of the CAA, petitions for judicial review 
of this action must be filed in the United States Court of Appeals for 
the appropriate circuit by April 9, 2012. Filing a petition for 
reconsideration by the Administrator of this final rule does not affect 
the finality of this action for the purposes of judicial review nor 
does it extend the time within which a petition for judicial review may 
be filed, and shall not postpone the effectiveness of such rule or 
action. This action may not be challenged later in proceedings to 
enforce its requirements. See CAA section 307(b)(2), 42 U.S.C. 
7607(b)(2).

List of Subjects in 40 CFR Part 52

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

    Dated: January 27, 2012.
A. Stanley Meiburg,
Acting Regional Administrator, Region 4.
    40 CFR part 52 is amended as follows:

PART 52--[AMENDED]

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

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

Subpart RR--Tennessee

0
2. Section 52.2220 (c) is amended under Chapter 1200-3-9 by revising 
the entries for ``Section 1200-3-9-.01,'' ``Section 1200-3-9-.02,'' and 
``Section 1200-3-9-.03'' to read as follows:


Sec.  52.2220  Identification of plan.

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    (c) * * *

[[Page 6019]]



                                   Table 1--EPA Approved Tennessee Regulations
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                                                     State effective
         State citation            Title/subject           date        EPA approval date        Explanation
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                               Chapter 1200-3-9 Construction and Operating Permits
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Section 1200-3-9-.01...........  Construction              5/10/2009   2/7/2012 [Insert   EPA is approving
                                  Permits.                              citation of        Tennessee's May 28,
                                                                        publication].      2009 SIP revisions to
                                                                                           Chapter 1200-3-9-.01
                                                                                           with the exception of
                                                                                           the ``baseline actual
                                                                                           emissions''
                                                                                           calculation revision
                                                                                           found at 1200-3-9-.01
                                                                                           (4)(b)45(i)(III),
                                                                                           (4)(b)45(ii)(IV),
                                                                                           (5)(b)1(xlvii)(I)(III
                                                                                           ) and
                                                                                           (5)(b)1(xlvii)(II)(IV
                                                                                           ) of the submittal.
Section 1200-3-9-.02...........  Operating Permits         5/10/2009   2/7/2012 [Insert   ......................
                                                                        citation of
                                                                        publication].
Section 1200-3-9-.03...........  General                   5/10/2009   2/7/2012 [Insert   ......................
                                  Provisions.                           citation of
                                                                        publication].
 
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[FR Doc. 2012-2601 Filed 2-6-12; 8:45 am]
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