1
6560­
50­
P
ENVIRONMENTAL
PROTECTION
AGENCY
40
CFR
Parts
51
and
96
[
EPA­
HQ­
OAR­
2003­
0053;
FRL­
]

[
RIN
2060­
AM95]

Inclusion
of
Delaware
and
New
Jersey
In
the
Clean
Air
Interstate
Rule
AGENCY:
Environmental
Protection
Agency
(
EPA).

ACTION:
Final
Rule.

SUMMARY:
In
today's
action,
we
are
finalizing
regulations
to
include
Delaware
and
New
Jersey
in
the
Clean
Air
Interstate
Rule
(
CAIR)
for
fine
particles
(
PM2.5),
based
on
our
assessment
that
they
contribute
significantly
to
a
downwind
State's
nonattainment.
In
the
CAIR,
we
determined
that
upwind
States
that
contribute
0.2
Fg/
m3
or
more
to
a
downwind
PM2.5
nonattainment
area
are
potentially
deemed
to
be
contributing
significantly
to
nonattainment
in
the
downwind
State.
The
EPA
proposed
to
augment
the
analytical
approach
used
in
the
CAIR
by
supplementing
the
air
quality
step
of
the
contribution
analysis.
Based
on
the
results
of
this
augmented
analytical
approach,
we
proposed
that
Delaware
and
New
Jersey
should
be
covered
by
the
CAIR
for
annual
sulfur
dioxide
(
SO2)
and
nitrogen
oxides
(
NOx)
2
requirements
and
are
finalizing
the
regulation
to
include
these
States
in
the
CAIR
for
PM2.5.

DATES:
This
final
rule
is
effective
on
[
Insert
date
30
days
after
publication
in
the
Federal
Register].

ADDRESSES:
The
EPA
has
established
a
docket
for
this
action
under
Docket
ID
No.
EPA­
HQ­
OAR­
2003­
0053.
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,
e.
g.,
Confidential
Business
Information
(
CBI)
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
Air
Docket,

EPA/
DC,
EPA
West,
Room
B102,
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.
The
Air
Docket
telephone
number
is
(
202)

566­
1742.

FOR
FURTHER
INFORMATION
CONTACT:
General
questions
concerning
today's
action
should
be
addressed
to
Jan
King,

U.
S.
EPA,
Office
of
Air
Quality
Planning
and
Standards,
Air
3
Quality
Strategies
and
Standards
Division,
Mail
Code
C539­

02,
Research
Triangle
Park,
NC,
27711,
telephone
(
919)
541­

5665,
e­
mail
king.
jan@
epa.
gov.
For
legal
questions,
please
contact
Steven
Silverman,
U.
S.
EPA,
Office
of
General
Counsel,
Mail
Code
2344A,
1200
Pennsylvania
Avenue,
NW,

Washington,
DC,
20460,
telephone
(
202)
564­
5523,
e­
mail
at
silverman.
steven@
epa.
gov.
For
questions
regarding
air
quality
analyses,
please
contact
Norm
Possiel,
U.
S.
EPA,

Office
of
Air
Quality
Planning
and
Standards,
Emissions,

Monitoring,
and
Analysis
Division,
Mail
Code
D243­
01,

Research
Triangle
Park,
NC,
27711,
telephone
(
919)
541­
5692,

e­
mail
at
possiel.
norm@
epa.
gov.
For
questions
regarding
the
electric
generating
units
(
EGU)
cost
analyses,
emissions
inventories,
and
budgets,
and
also
for
questions
regarding
the
model
cap
and
trade
programs,
please
contact
Sam
Waltzer,
U.
S.
EPA,
Office
of
Atmospheric
Programs,
Clean
Air
Markets
Division,
Mail
Code
6204J,
1200
Pennsylvania
Avenue,

NW,
Washington,
DC,
20460,
telephone
(
202)
343­
9175,
e­
mail
at
waltzer.
sam@
epa.
gov.
For
questions
regarding
statewide
emissions
inventories,
please
contact
Marc
Houyoux,
U.
S.

EPA,
Office
of
Air
Quality
Planning
and
Standards,

Emissions,
Monitoring,
and
Analysis
Division,
Mail
Code
D205­
01,
Research
Triangle
Park,
NC,
27711,
telephone
(
919)

541­
3649,
e­
mail
at
houyoux.
marc@
epa.
gov.
For
questions
4
regarding
emissions
reporting
requirements,
please
contact
Bill
Kuykendal,
U.
S.
EPA,
Office
of
Air
Quality
Planning
and
Standards,
Emissions,
Monitoring,
and
Analysis
Division,

Mail
Code
D205­
01,
Research
Triangle
Park,
NC,
27711,

telephone
(
919)
541­
5372,
e­
mail
at
kuykendal.
bill@
epa.
gov.

For
questions
regarding
analyses
required
by
statutes
and
executive
orders,
please
contact
Linda
Chappell,
U.
S.
EPA,

Office
of
Air
Quality
Planning
and
Standards,
Air
Quality
Strategies
and
Standards
Division,
Mail
Code
C339­
01,

Research
Triangle
Park,
NC,
27711,
telephone
(
919)
541­
2864,

e­
mail
at
chappell.
linda@
epa.
gov.

SUPPLEMENTARY
INFORMATION:

Web
Site
for
Rulemaking
Information
The
EPA
has
established
a
web
site
for
this
rulemaking
at
http://
www.
epa.
gov/
cleanairinterstaterule/
or
http://
www.
epa.
gov/
cair/
which
includes
the
rulemaking
actions
and
certain
other
related
information
that
the
public
may
find
useful.

Judicial
Review
Section
307(
b)(
1)
of
the
CAA
indicates
which
Federal
Courts
of
Appeal
have
venue
for
petitions
of
review
of
final
actions
by
EPA.
This
section
provides,
in
part,
that
petitions
for
review
must
be
filed
in
the
Court
of
Appeals
for
the
District
of
Columbia
Circuit
if
(
i)
the
agency
5
action
consists
of
"
nationally
applicable
regulations
promulgated,
or
final
action
taken,
by
the
Administrator,"

or
(
ii)
such
action
is
locally
or
regionally
applicable,
if
"
such
action
is
based
on
a
determination
of
nationwide
scope
or
effect
and
if
in
taking
such
action
the
Administrator
finds
and
publishes
that
such
action
is
based
on
such
a
determination."

Any
final
action
related
to
the
CAIR
is
"
nationally
applicable"
within
the
meaning
of
section
307(
b)(
1).
As
an
initial
matter,
through
this
rule,
EPA
interprets
section
110
(
a)(
2)(
D)(
i)
of
the
CAA,
a
provision
which
has
nationwide
applicability.
In
addition,
the
CAIR
applies
to
28
States
and
the
District
of
Columbia.
The
CAIR
is
also
based
on
a
common
core
of
factual
findings
and
analyses
concerning
the
transport
of
pollutants
between
the
different
States
subject
to
it.
Finally,
EPA
has
established
uniform
approvability
criteria
that
would
be
applied
to
all
States
subject
to
the
CAIR.
For
these
reasons,
the
Administrator
also
is
determining
that
any
final
action
regarding
the
CAIR
is
of
nationwide
scope
and
effect
for
purposes
of
section
307(
d)(
1).
Thus,
any
petitions
for
review
of
final
actions
regarding
the
CAIR
must
be
filed
in
the
Court
of
Appeals
for
the
District
of
Columbia
Circuit
within
60
days
from
the
date
final
action
is
published
in
the
Federal
Register.
6
Outline
I.
Overview
A.
What
Are
the
Central
Requirements
of
This
Rule?
B.
Why
Are
We
Taking
This
Action?

II.
Air
Quality
Analysis
of
Ozone
and
PM2.5
Contributions
in
the
CAIR
A.
Analysis
of
Highly
Cost­
Effective
Controls
and
Timeframe
for
Emissions
Reductions
1.
Overall
Criteria
2.
Evaluation
of
Cost
Effectiveness
and
Feasibility
3.
CAIR
Regionwide
SO2
and
NOx
Emissions
Reduction
Requirements
III.
Inclusion
of
Delaware
and
New
Jersey
in
the
CAIR
for
PM2.5
A.
Why
EPA
Reconsidered
the
Status
of
Delaware
and
New
Jersey
in
the
CAIR
B.
Results
of
Updated
Air
Quality
Modeling
for
Delaware
and
New
Jersey
IV.
Findings
and
Action
A.
Findings
of
Significant
Contribution
for
Delaware
and
New
Jersey
B.
SIP
Approval
Criteria
C.
SIP
Submittal
Deadline
D.
Emissions
Reporting
Requirements
V.
Expected
Effects
of
This
Action
A.
Emissions
B.
Air
Quality
VI.
Statutory
and
Executive
Order
Reviews
A.
Executive
Order
12866:
Regulatory
Planning
and
Review
B.
Paperwork
Reduction
Act
C.
Regulatory
Flexibility
Act
D.
Unfunded
Mandates
Reform
Act
E.
Executive
Order
13132:
Federalism
F.
Executive
Order
13175:
Consultation
and
Coordination
with
Indian
Tribal
Governments
G.
Executive
Order
13045:
Protection
of
Children
from
Environmental
Health
and
Safety
Risks
H.
Executive
Order
13211:
Actions
That
Significantly
Affect
Energy
Supply,
Distribution
or
Use
I.
National
Technology
Transfer
Advancement
Act
J.
Executive
Order
12898:
Federal
Actions
to
Address
Environmental
Justice
in
Minority
Populations
and
Low­
Income
Populations
7
K.
Congressional
Review
Act
I.
OVERVIEW
By
notice
of
proposed
rulemaking
dated
May
12,
2005,

EPA
proposed
to
include
Delaware
and
New
Jersey
in
the
CAIR,

which
was
published
on
the
same
date
(
70
FR
25162).
We
are
finalizing
that
proposal
here.
The
final
rule
requires
Delaware
and
New
Jersey
to
adopt
and
submit
State
implementation
plans
(
SIPs),
under
the
requirements
of
Clean
Air
Act(
CAA)
section
110(
a)(
2)(
D),
that
would
eliminate
emissions
of
specified
amounts
of
SO2
and
NOx
which
contribute
significantly
to
nonattainment
of
the
PM
2.5
National
Ambient
Air
Quality
Standard
(
NAAQS)
in
a
downwind
State.
Although
Delaware
and
New
Jersey
are
now
combined
to
determine
significant
contribution,
these
States
may
independently
determine
which
sources
to
subject
to
controls,
and
which
control
measures
to
adopt.
The
EPA's
analysis
indicates
that
emissions
reductions
from
EGUs
are
highly
cost
effective,
and
EPA
encourages
Delaware
and
New
Jersey
to
adopt
controls
for
EGUs.
To
do
so,
they
must
place
an
enforceable
limit,
or
cap,
on
EGU
emissions
(
see
section
VII
of
the
CAIR
for
a
more
detailed
discussion).

The
EPA
has
calculated
the
amount
of
each
State's
EGU
emissions
cap,
or
budget,
based
on
reductions
that
EPA
has
8
determined
are
highly
cost
effective
(
see
section
IV
of
this
rule).
Delaware
and
New
Jersey
may
also
allow
their
EGUs
to
participate
in
an
EPA­
administered
cap
and
trade
program
as
a
way
to
reduce
the
cost
of
compliance.
The
cap
and
trade
programs
are
described
in
more
detail
in
section
VIII
of
the
preamble
to
the
final
CAIR.

A.
What
Are
the
Central
Requirements
of
this
Rule?

In
today's
action,
we
establish
SIP
requirements
for
the
affected
upwind
States
of
Delaware
and
New
Jersey
under
CAA
section
110(
a)(
2)(
D)(
i).
Section
110(
a)(
2)(
D)(
i)
of
the
CAA
requires
SIPs
to
contain
adequate
provisions
prohibiting
air
pollutant
emissions
from
sources
or
activities
in
those
States
which
emissions
contribute
significantly
to
nonattainment
in,
or
interfere
with
maintenance
by,
any
other
State
with
respect
to
a
national
ambient
air
quality
standard
(
NAAQS).
Based
on
air
quality
modeling
analyses
and
cost
analyses,
EPA
has
concluded
that
SO2
and
NOx
emissions
in
Delaware
and
New
Jersey,
through
the
phenomenon
of
air
pollution
transport,
1
contribute
significantly
to
downwind
nonattainment
of
the
PM2.5
NAAQS.
2
In
addition
to
1
In
today's
final
rule,
when
we
use
the
term
"
transport"
we
mean
to
include
the
transport
of
both
fine
particles
(
PM2.5)
and
their
precursor
emissions.

2
In
the
CAIR,
the
23
States
along
with
the
District
of
Columbia
that
must
reduce
SO2
and
NOx
emissions
for
the
purposes
of
the
PM2.5
NAAQS
are:
Alabama,
Florida,
Georgia,
Illinois,
Indiana,
Iowa,
Kentucky,
Louisiana,
Maryland,
Michigan,
Minnesota,
Mississippi,
Missouri,
New
York,
North
9
making
the
findings
of
significant
contribution
to
nonattainment,
EPA
is
requiring
Delaware
and
New
Jersey
to
make
specified
amounts
of
SO2
and
NOx
emissions
reductions
to
eliminate
their
significant
contribution
to
downwind
States.
Delaware
and
New
Jersey
are
required
to
adopt
and
submit
SIP
revisions
with
the
necessary
control
measures
by
September
11,
2006.

B.
Why
Are
We
Taking
this
Action?

On
May
12,
2005,
we
proposed
to
include
Delaware
and
New
Jersey
in
the
CAIR
for
PM2.5.
Our
assessment
was
that
the
combination
of
the
two
States
does
contribute
significantly
to
PM2.5
nonattainment
in
New
York
County,
NY,

and
to
one
or
more
counties
in
eastern
Pennsylvania.
In
that
action,
we
proposed
the
following:

°
combining
Delaware
and
New
Jersey
for
purposes
of
assessing
whether
that
combination
contributes
significantly
to
nonattainment
of
the
PM2.5
NAAQS
by
downwind
receptors
under
section
110(
a)(
2)(
D);

°
requiring
Delaware
and
New
Jersey,
under
CAA
section
110(
a)(
2)(
D),
to
adopt
SIP
requirements
for
addressing
annual
emissions
of
the
PM2.5
precursors
NOx
and
SO2;

°
adding
requirements
for
control
of
annual
emissions
of
SO2
and
NOx;

Carolina,
Ohio,
Pennsylvania,
South
Carolina,
Tennessee,
Texas,
Virginia,
West
Virginia,
and
Wisconsin.
10
°
requiring
that
SIPs
to
achieve
the
required
PM2.5
emissions
reductions
be
submitted
as
soon
as
practicable,
but
no
later
than
18
months
after
the
date
of
signature
of
the
CAIR,
i.
e.,
September
11,
2006,
the
same
deadline
as
in
the
CAIR.;

°
providing
model
cap
and
trade
programs
for
EGUs
in
the
CAIR
and
administering
these
programs.

Delaware
and
New
Jersey
are
already
subject
to
the
CAIR
for
purposes
of
ozone,
and
must
reduce
ozone
season
emissions
of
NOx
starting
in
2009.
We
proposed
to
add
requirements
for
control
of
annual
emissions
of
NOx
by
2009
and
SO2
by
2010
for
purposes
of
PM2.5.
We
also
proposed
larger
reductions
by
2015
for
NOx
and
SO2
in
order
to
avoid
contributing
significantly
to
PM2.5
nonattainment,
or
interfere
with
maintenance,
in
other
States.

We
performed
air
quality
modeling
to
determine
the
contribution
from
projected
2010
SO2
and
NOx
emissions
in
Delaware
and
New
Jersey
combined
to
PM2.5
nonattainment
in
downwind
States.
The
results
of
this
modeling
were
provided
in
a
Notice
of
Data
Availability
(
NODA)
(
70
FR
37068,
June
28,
2005).
The
results
show
that
the
largest
contribution
from
Delaware
and
New
Jersey
was
0.23
µ
g/
m3
to
PM2.5
nonattainment
in
New
York
County,
New
York.
This
amount
exceeds
EPA's
PM2.5
significance
criterion
of
0.2
µ
g/
m3.
11
Based
on
a
comment
we
received
from
the
State
of
Delaware
on
the
proposed
rule,
we
have
updated
our
2010
emissions
projections
for
Delaware
and
re­
ran
the
model
for
Delaware
and
New
Jersey
(
EPA­
HQ­
OAR­
2003­
0053­
).
See
section
III.
B
of
this
rule
for
further
discussion
of
this
comment
and
our
response.
The
revised
modeling
confirms
that
the
combination
of
Delaware
and
New
Jersey
make
a
significant
contribution
to
PM2.5
nonattainment
in
at
least
one
downwind
State
thus
necessitating
SIP
revisions
under
section
110
(
a)(
2)(
D)
to
eliminate
the
significant
contribution.
Therefore,
we
are
finalizing
the
requirement
for
Delaware
and
New
Jersey
that
they
adopt
SIP
requirements
for
addressing
annual
emissions
of
the
PM2.5
precursors
NOx
and
SO2.

II.
AIR
QUALITY
ANALYSIS
OF
OZONE
AND
PM2.5
CONTRIBUTIONS
IN
THE
CAIR3
For
the
CAIR,
we
performed
State­
by­
State
zero­
out
modeling
to
quantify
the
contribution
from
emissions
in
each
State
to
future
ozone
and
PM2.5
nonattainment
in
other
States
and
to
determine
whether
that
contribution
meets
requirements
of
the
"
contribute
significantly"
test.
This
zero­
out
modeling
technique
provides
an
estimate
of
downwind
3
This
discussion
is
for
readers'
convenience.
The
EPA
did
not
reconsider
or
otherwise
reopen
any
aspect
of
the
CAIR
in
this
rulemaking,
except
for
the
matter
specifically
proposed.
12
impacts
by
comparing
the
model
predictions
from
the
2010
base
case
to
the
predictions
from
a
run
in
which
all
anthropogenic
NOx
emissions
(
in
the
case
of
ozone)
or
all
anthropogenic
SO2
and
NOx
emissions
(
in
the
case
of
PM2.5)

are
removed
from
specific
States,
one
State
at
a
time.

After
considering
an
updated
analysis
and
public
comments,

we
applied
a
threshold
of
0.2
Fg/
m3
for
PM2.5
for
this
determination.

For
more
detailed
discussions
of
EPA's
analytical
approach,
findings,
and
final
actions
in
the
CAIR,
see
70
FR
25162,
May
12,
2005.

A.
Analysis
of
Highly
Cost­
Effective
Controls
and
Timeframe
for
Emissions
Reductions
1.
Overall
Criteria
In
the
CAIR
rulemaking,
we
considered
a
variety
of
factors
in
evaluating
the
source
categories
from
which
highly
cost­
effective
reductions
may
be
available
and
the
level
of
reduction
assumed
from
that
sector.
These
include:

C
The
availability
of
information,

C
The
identification
of
source
categories
emitting
relatively
large
amounts
of
the
relevant
emissions,

C
The
performance
and
applicability
of
control
measures,

C
The
cost
effectiveness
of
control
measures,
and
C
Engineering
and
financial
factors
that
affect
the
13
availability
of
control
measures.

We
further
stated
that
overall,
"
We
are
striving
...
to
set
up
a
reasonable
balance
of
regional
and
local
controls
to
provide
a
cost­
effective
and
equitable
governmental
approach
to
attainment
with
the
NAAQS
for
fine
particles
and
ozone."
These
criteria
are
unaffected
by
this
rule.

2.
Evaluation
of
Cost
Effectiveness
and
Feasibility
The
CAIR
preamble
describes
EPA's
determination
of
regionwide
SO2
and
NOx
control
levels.
As
described
in
section
IV
in
the
CAIR
preamble,
EPA
determined
that
highly
cost­
effective
emissions
reductions
may
be
obtained
by
controlling
EGUs.
The
EPA
determined
the
amounts
of
emissions
reductions
that
must
be
eliminated
in
upwind
States
to
help
downwind
States
achieve
attainment
of
the
PM2.5
and
ozone
NOx
NAAQS,
by
assuming
the
application
of
highly
cost­
effective
control
measures
to
EGUs
and
determining
the
emissions
reductions
that
would
result.

For
the
CAIR,
EPA
determined
highly
cost­
effective
regionwide
amounts
of
emissions
reductions
based
on
comparison
to
reference
lists
of
the
cost
effectiveness
of
other
regulatory
controls.
We
developed
reference
lists
for
both
average
and
marginal
cost
effectiveness
of
those
other
controls.
By
comparison
to
the
reference
lists,
EPA
determined
that
the
CAIR
final
(
2015)
SO2
and
NOx
regionwide
14
control
levels
are
highly
cost
effective.
The
EPA
also
developed
marginal
cost­
effectiveness
curves
for
SO2
and
NOx
abatement
at
varying
levels
of
stringency,
to
corroborate
its
cost­
effectiveness
determinations.

The
EPA
determined
the
interim
control
levels
(
commencing
in
2009
for
NOx
and
in
2010
for
SO2)
based
on
evaluating
the
feasibility
of
installing
the
necessary
emission
control
retrofits.
Although
the
interim
regionwide
control
levels
were
determined
based
on
feasibility
considerations,
EPA
also
evaluated
the
cost
effectiveness
of
the
interim
control
levels
to
ensure
that
they
were
also
highly
cost
effective.

Section
IV.
A
describes
our
evaluation
of
highly
costeffective
controls
and
section
IV.
C
in
the
CAIR
NFR
preamble
describes
EPA's
feasibility
analysis.
Section
V
in
the
CAIR
NFR
preamble
describes
the
method
EPA
used
to
apportion
regionwide
control
levels
to
the
affected
States.
A
technical
support
document
in
the
CAIR
docket
entitled
"
Modeling
of
Control
Costs,
Emissions,
and
Control
Retrofits
for
Cost
Effectiveness
and
Feasibility
Analyses"
describes
EPA's
use
of
the
Integrated
Planning
Model
(
IPM)
for
its
cost­
effectiveness
and
feasibility
analyses.
In
addition,
a
technical
support
document
entitled
"
Boilermaker
Labor
Analysis
for
the
Final
Clean
Air
Interstate
Rule"
provides
15
further
explanation
of
EPA's
feasibility
analyses.

Documentation
for
IPM,
as
well
as
IPM
output
files,
are
available
in
the
CAIR
docket
listed
in
the
ADDRESSES
section
of
this
rule.

3.
CAIR
Regionwide
SO2
and
NOx
Emissions
Reductions
Requirements
The
CAIR
NFR
requires
annual
SO2
and
NOx
reductions
in
the
District
of
Columbia
and
the
23
States
listed
in
section
I.
A
above.
If
all
affected
States
choose
to
implement
the
CAIR
annual
SO2
emission
reduction
requirements
by
controlling
EGUs,
the
regionwide
annual
SO2
emissions
caps
that
will
apply
to
in
these
23
States
and
the
District
of
Columbia
are
3.6
million
tons
in
2010
and
2.5
million
tons
in
2015.
If
all
affected
States
choose
to
implement
the
CAIR
annual
NOx
emission
reduction
requirements
by
controlling
EGUs,
the
regionwide
annual
NOx
emissions
caps
that
will
apply
for
EGUs
in
these
23
States
and
the
District
of
Columbia
are
1.5
million
tons
in
2009
and
1.3
million
tons
in
2015.

The
CAIR
does
not
require
annual
SO2
or
NOx
emissions
reductions
in
Delaware
or
New
Jersey
for
purposes
of
the
PM
2.5
NAAQS.
4
However,
today
EPA
is
requiring
annual
SO2
and
NOx
reductions
in
these
two
States
for
that
purpose.
Annual
4
The
CAIR
does
require
ozone
season
NOx
emissions
reductions
in
Delaware
and
New
Jersey
for
ozone.
16
SO2
and
NOx
budgets
for
Delaware
and
New
Jersey
are
presented
in
section
IV.
B
of
this
preamble.
Since
EPA
is
finalizing
annual
SO2
and
NOx
budgets
for
Delaware
and
New
Jersey,
the
States
may
choose
to
implement
their
annual
emission
reduction
requirements
by
controlling
EGUs.
If
the
States
choose
to
control
EGUs,
the
CAIR
regionwide
EGU
caps
will
include
reduction
requirements
for
these
two
States.

The
updated
annual
SO2
caps,
including
Delaware
and
New
Jersey,
would
be
3.7
million
tons
in
2010
and
2.6
million
tons
in
2015.
The
updated
annual
NOx
caps,
including
Delaware
and
New
Jersey,
would
be
1.5
million
tons
in
2009
and
1.3
million
tons
in
2015.

III.
INCLUSION
OF
DELAWARE
AND
NEW
JERSEY
IN
THE
CAIR
FOR
PM2.5
A.
Why
EPA
is
Revising
the
Status
of
Delaware
and
New
Jersey
in
the
CAIR
Section
110(
a)(
2)(
D)(
i)
of
the
CAA
requires
States
to
include
in
their
SIPs
adequate
provisions
prohibiting
emissions
that
will
contribute
significantly
to
nonattainment
in,
or
interfere
with
maintenance
by,
any
other
State.
The
term
"
contribute
significantly"
is
not
further
defined,
so
in
implementing
this
section
we
have
had
to
develop
an
analytical
approach
to
give
the
term
specific
meaning.
The
underlying
logic
of
the
analytical
approach
17
used
in
both
the
NOx
SIP
Call
and
the
CAIR
is
that
the
emission
reduction
efforts
needed
to
reach
attainment
should
be
reasonably
balanced
between
the
State
containing
a
nonattainment
area
and
upwind
States
significantly
contributing
to
the
nonattainment.
In
this
way,
control
efforts
on
one
side
of
a
border
are
not
undermined
(
and
even
rendered
futile)
by
out­
of­
State
emissions,
and
highly
costeffective
emissions
reductions
by
out­
of­
State
sources
which
contribute
significantly
to
downwind
receptors'

nonattainment
are
achieved.
We
believe
this
approach
is
both
efficient
and
equitable,
so
that
overall
costs
are
less
and
costs
are
more
fairly
distributed
than
if
the
burden
of
reaching
attainment
were
entirely
on
the
State
with
the
nonattainment
area.
Congress
had
the
same
purpose
when
it
enacted
section
110(
a)(
2)(
D).
See
64
FR
29260­
61
(
May
25,

1999)
(
summarizing
Legislative
History
of
section
110(
a)(
2)(
D)
predecessor
provision).

We
are
retaining
this
underlying
analytical
approach,

but
treating
Delaware
and
New
Jersey
as
special
cases
and
as
a
single
geographic
area
for
PM2.5.
Specifically,
we
are
combining
Delaware
and
New
Jersey
for
purposes
of
assessing
significant
contribution
to
nonattainment
of
the
PM2.5
NAAQS
by
downwind
receptors
under
section
110(
a)(
2)(
D),
and
applying
the
finding
from
that
combined
assessment
to
each
18
State.

The
analytical
approach
used
for
the
CAIR
has
two
parts,
the
first
of
which
is
a
test
of
whether
the
air
quality
contribution
from
one
entire
State
to
nonattainment
in
any
part
of
another
State
is
substantial
enough
to
be
considered
significant,
pending
consideration
of
control
costs.
For
ozone,
we
used
a
test
for
this
first
part
which
is
based
on
several
metrics
of
air
quality
contribution,

involving
absolute
magnitude,
relative
magnitude,
and
frequency.
For
PM2.5,
we
used
a
test
with
the
single
criterion
of
whether
the
PM2.5
air
quality
contribution
from
an
upwind
State
to
nonattainment
in
a
downwind
State,
due
to
total
anthropogenic
SO2
and
NOx
emissions
in
the
upwind
State,
was
0.2
µ
g/
m3
or
more.
We
believe
that
this
specific
form
of
the
analytical
approach
used
in
the
final
CAIR
rule
has
very
appropriately
identified
a
set
of
23
States
and
the
District
of
Columbia
that
should
make
certain
reductions
in
annual
emissions
by
2009
for
NOx
and
by
2010
for
SO2,
and
larger
reductions
by
2015
for
NOx
and
SO2,
in
order
to
avoid
contributing
significantly
to
PM2.5
nonattainment
in
other
States.

In
the
course
of
applying
that
analytical
approach,
we
realized
that
an
upwind
State
may
have
relatively
low
total
emissions
and
thus
have
a
maximum
contribution
on
other
19
States
that
is
below
the
air
quality
contribution
threshold
used
in
the
CAIR,
simply
because
the
State
is
small
in
geographic
area,
and
yet
clearly
contributes
to
PM2.5
nonattainment
in
downwind
States,
because
the
upwind
State
is
located
between
an
even
further
upwind
State
that
significantly
contributes
to
nonattainment
in
a
downwind
State,
and
the
downwind
receptor
State.
Delaware
and
New
Jersey
are
examples
of
this
geographic
phenomenon.
Also,

Delaware
and
New
Jersey
each
has
substantial
emissions
for
its
size.
Therefore,
excluding
Delaware
or
New
Jersey
from
emission
reduction
requirements
related
to
PM2.5
would
prevent
the
desired
balancing
of
local
and
upwind
controls.

Excluding
either
State
could
forgo
opportunities
for
highly
cost­
effective
control
that
would
improve
air
quality
in
nearby
States'
PM2.5
nonattainment
areas.
Ignoring
the
contributions
of
Delaware
and
New
Jersey
could
result
in
both
air
quality
detriments
and
cost
inefficiencies
and
inequities.

The
EPA
considered
alternative
approaches
to
addressing
this
issue.
We
do
not
believe
it
would
be
appropriate
to
consider
amending
or
revising
the
contribution
significance
criteria
set
forth
in
the
final
CAIR
notice.
Nevertheless,

we
believe
that
these
two
States,
which
combined
represent
a
significant
source
of
PM2.5
precursor
emissions,
should
not
20
be
considered
to
be
below
the
air
quality
contribution
threshold,
in
the
unique
circumstances
presented
here,

solely
because
of
their
comparatively
small
geographic
size.

We
have
faced
a
similar
issue
with
respect
to
small
geographic
entities
in
the
NOx
SIP
Call,
where
we
combined
emissions
of
Delaware,
Maryland,
and
the
District
of
Columbia,
and
more
recently
in
the
CAIR,
where
we
combined
emissions
of
the
District
of
Columbia
and
Maryland.

The
final
CAIR's
exclusion
of
Delaware
and
New
Jersey
for
purposes
of
PM2.5
drew
our
attention
because
of
features
unique
to
Delaware
and
New
Jersey.
Table
III­
1
and
Table
III­
2
in
the
proposal
to
include
Delaware
and
New
Jersey
in
the
CAIR
PM2.5
region
(
70
FR
25414
and
25415,
respectively)

present
relevant
facts
regarding
Delaware
and
New
Jersey.

We
believe
the
following
specific
conditions
with
respect
to
Delaware
and
New
Jersey
justify
the
departure
from
the
CAIR
significance
criteria
because
both
States:

 
are
contiguous;

 
have
relatively
small
land
area;

 
have
high
emissions
densities;

 
are
near
major
cities
where
PM2.5
nonattainmente
affects
large
populations;
and
 
are
located
between
upwind
and
at
least
one
downwind
area
linked
to
an
upwind
State.
21
On
balance,
we
believe
the
most
appropriate
way
to
address
the
factual
situation
presented
here
is
to
consider
Delaware's
and
New
Jersey's
contributions
together,
as
one
unit
of
analysis.
We
also
note
that
both
States
assented
to
this
approach.
Since
Delaware
and
New
Jersey
are
already
subject
to
the
CAIR
for
purposes
of
ozone,
the
remainder
of
this
discussion
focuses
on
PM2.5
considerations.

Delaware
and
New
Jersey
are
both
relatively
small
in
land
area;
both
are
smaller
than
any
of
the
23
States
already
subject
to
the
CAIR
for
purposes
of
PM2.5.
Portions
of
both
States
are
urbanized
and
industrialized,
and
overall
both
have
a
high
emissions
density,
comparable
to
that
of
their
neighbors.
5
Delaware
has
an
emissions
density
of
76.1
tons/
year
per
square
mile,
almost
twice
that
of
neighboring
Pennsylvania
and
also
higher
than
that
of
Maryland,
States
already
linked
to
downwind
PM2.5
nonattainment
areas.
New
Jersey
has
an
emissions
density
of
46.6
tons/
year
per
square
mile,
above
that
of
Pennsylvania
although
somewhat
lower
than
that
of
Maryland.

5
By
emissions
density
we
mean
the
total
SO2
and
NOx
emissions
from
each
State
in
tons
per
year,
divided
by
the
geographic
area
of
the
State
in
square
miles.
For
comparing
emissions
densities
for
the
purposes
of
contributions
to
PM2.5
nonattainment,
we
have
compared
the
emissions
density
expressed
in
terms
of
SO2
plus
NOx
emissions
per
square
mile.
Such
a
comparison
is
a
reasonable
measure
of
comparison
that
is
independent
of
the
disparity
in
the
land
area
size
of
the
two
States.
22
Delaware
and
New
Jersey
are
near
major
cities
where
current
PM2.5
nonattainment
affects
large
populations.

Also,
both
are
relatively
near
a
county
or
counties
in
other
States
that
are
projected
to
still
be
in
nonattainment
for
PM2.5
in
2010
in
the
base
modeling
case.
Delaware
and
New
Jersey
are
also
near
large
markets
for
electric
power
in
other
States
subject
to
the
CAIR
for
PM2.5,
and
both
are
part
of
the
PJM
Interconnect
electric
generation.
As
a
result,
there
is
a
potential
for
emissions
shifting
from
States
subject
to
the
PM2.5
requirements
of
the
CAIR
to
States
not
subject
to
those
requirements,
e.
g.,
Delaware
and
New
Jersey.

Both
Delaware
and
New
Jersey
lie
between
upwind
States
that
are
now
subject
to
the
CAIR
for
both
ozone
and
PM2.5
and
downwind
receptor
PM2.5
nonattainment
areas
that
are
linked
to
one
or
both
of
those
upwind
States.
Maryland
has
already
been
determined
to
contribute
significantly
to
nonattainment
in
both
Philadelphia
and
New
York
City.

Pennsylvania
has
already
been
determined
to
contribute
significantly
to
nonattainment
in
New
York
City,
and
New
York
has
been
determined
to
contribute
to
nonattainment
in
Lancaster
County,
Pennsylvania.
New
Jersey
lies
between
Pennsylvania
and
New
York
City,
and
Delaware
lies
between
part
of
Maryland
and
both
Philadelphia
and
New
York
City.
23
This
means
that
emissions
from
Delaware
and
New
Jersey
are
mixed
with
the
emissions
of
these
other
upwind
States
and
arrive
together
at
the
downwind
nonattainment
areas
in
other
States.
Moreover,
Delaware
and
New
Jersey
are
closer
to
these
receptors.

Given
these
highly
distinctive
facts,
considered
in
conjunction
with
the
data
concerning
the
downwind
emissions
contributions
from
Delaware
and
New
Jersey,
it
is
reasonable
that
Delaware
and
New
Jersey
be
viewed
as
an
entity
for
assessing
significance
of
PM2.5
nonattainment
in
downwind
States.
We
did
this
by
treating
the
combination
of
these
two
small
States
as
a
unit,
and
then
evaluating
the
combined
emissions
with
the
0.2
µ
g/
m3
threshold
for
PM2.5
air
quality
contribution
used
in
the
CAIR.
As
noted,
this
is
consistent
with
our
approach
in
the
NOx
SIP
Call
and
other
aspects
of
the
CAIR
in
which
we
also
aggregated
certain
States
in
assessing
significant
contribution.
We
note
also
that
Delaware
and
New
Jersey
lie
side­
by­
side
and
together
form
a
compact
geographic
area.
We
believe
this
further
supports
combining
them
for
purposes
of
this
analysis.
By
combining
these
two
small
States,
we
believe
the
underlying
costbalancing
and
control
program
efficiency
goals
of
our
original
analytical
approach
can
be
better
met.

Virtually
every
commenter
(
including
New
Jersey
and
24
Delaware)
agreed
with
this
approach.
The
only
negative
comment
termed
the
proposed
approach
"
arbitrary"
(
without
further
analysis),
and
requested
that
EPA
adhere
to
existing
approaches
for
assessing
significant
contribution.
The
EPA
disagrees
that
aggregating
Delaware
and
New
Jersey
emissions
is
arbitrary,
for
the
reasons
just
set
forward.
Indeed,

given
the
facts
here
(
especially
the
emission
density
and
geographic
location
of
the
two
states),
it
could
be
argued
that
it
is
arbitrary
not
to
combine
the
emissions
for
those
two
States
in
assessing
significance
of
contribution.

Moreover,
past
EPA
practice
in
both
the
CAIR
and
the
NOx
SIP
Call
has
aggregated
emissions
across
state
boundaries
in
similar
circumstances,
as
explained
above.

B.
Results
of
Updated
Air
Quality
Modeling
for
Delaware
and
New
Jersey
The
proposed
rule
for
including
Delaware
and
New
Jersey
in
the
CAIR
included
an
analysis
of
the
contribution
of
anthropogenic
SO2
and
NOx
emissions
in
these
two
States
to
PM2.5
nonattainment
in
other
States.
This
analysis
was
based
upon
the
sum
of
the
contributions
from
Delaware
and
from
New
Jersey
to
each
downwind
nonattainment
receptor.

The
contribution
from
each
of
these
two
States
was
determined
based
on
air
quality
modeling
of
each
State
individually.
Details
on
EPA's
PM2.5
contribution
modeling
25
approach
can
be
found
in
the
Air
Quality
Modeling
Technical
Support
Document
for
the
final
CAIR.
6
In
brief,
the
modeling
approach
involves
"
zero­
out"
model
simulations
in
which
the
SO2
and
NOx
emissions
from
sources
in
a
given
State
or
multi­
State
area
are
removed
from
a
2010
base
case
scenario.
7
The
predictions
from
this
2010
"
zero­
out"
run
are
compared
to
predictions
from
the
corresponding
2010
Base
Case
simulation
to
quantify
the
contributions
to
downwind
"
modeled
plus
monitored"
PM2.5
nonattainment
receptors.
In
the
proposal,
we
stated
that
we
would
reassess
the
contribution
from
Delaware
and
New
Jersey
combined
by
performing
"
zero­
out"
modeling
in
which
SO2
and
NOx
emissions
are
removed
from
both
States
in
a
single
model
run.
We
conducted
the
combined
Delaware/
New
Jersey
zero­
out
modeling
and
the
results
were
provided
in
NODA
(
70
FR
37068,

June
28,
2005).

EPA
did
not
receive
any
significant
comment
challenging
the
proposal
to
combine
Delaware
and
New
Jersey
emissions
to
assess
significance
of
contribution
to
downwind
States'

PM2.5
NAAQS
nonattainment.
However,
one
commenter
stated
that
EPA's
modeling
of
Delaware
and
New
Jersey
failed
to
account
for
the
effect
on
SO2
emissions
in
Delaware
of
an
enforcement
action
against
the
Motiva
refinery.
The
6
Docket
No.
EPA­
HQ­
OAR­
2003­
0053­
2151.

7
2010
base
case
does
not
include
emissions
reductions
26
commenter
said
that
not
accounting
for
the
27,000
tons
per
year
reduction
in
SO2
at
this
facility,
as
required
by
a
Consent
Decree,
inflates
Delaware's
2010
base
case
emissions.

In
response
to
this
comment,
EPA
adjusted
downward
the
projected
2010
emissions
at
the
Motiva
refinery
to
reflect
the
required
reductions
and
remodeled
the
combined
contributions
from
Delaware
and
New
Jersey.
As
a
result,

2010
emissions
from
Delaware
in
the
revised
modeling
were
lower
than
in
the
NODA
modeling
by
over
29,000
tons
per
year
for
SO2
and
over
500
tons
per
year
for
NOx.
In
remodeling
Delaware
and
New
Jersey,
EPA
used
the
same
PM2.5
modeling
platform
as
was
used
for
the
CAIR
PM2.5
contribution
modeling.
The
contributions
from
Delaware
and
New
Jersey
to
PM2.5
nonattainment
in
other
States
based
on
the
revised
modeling
are
provided
in
Table
III­
1.
These
results
show
that
the
maximum
downwind
contribution
from
Delaware
and
New
Jersey
combined
is
0.21
µ
g/
m3
which
exceeds
EPA's
PM2.5
contribution
significance
criterion
of
0.20
µ
g/
m3.
Thus,
the
revised
modeling
for
Delaware
and
New
Jersey
combined
confirms
that
these
States
make
a
significant
contribution
to
PM2.5
nonattainment
in
a
downwind
State
(
namely
New
York
County,
New
York,
which
includes
New
York
City).

Table
III­
1.
PM2.5
Contributions
(
µ
g/
m3)
from
Delaware
expected
to
result
from
implementation
of
the
CAIR.
27
And
New
Jersey
Combined
to
PM2.5
Nonattainment.

State
County
PM2.5
Contribution
Alabama
Jefferson
Co
<
0.05
Alabama
Russell
Co
<
0.05
Delaware
New
Castle
Co
0.15
District
of
Columbia
District
of
Columbia
0.08
Georgia
Bibb
Co
<
0.05
Georgia
Clarke
Co
<
0.05
Georgia
Clayton
Co
<
0.05
Georgia
Cobb
Co
<
0.05
Georgia
DeKalb
Co
<
0.05
Georgia
Floyd
Co
<
0.05
Georgia
Fulton
Co
<
0.05
Georgia
Walker
Co
<
0.05
Illinois
Cook
Co
<
0.05
Illinois
Madison
Co
<
0.05
Illinois
St.
Clair
Co
<
0.05
Indiana
Clark
Co
<
0.05
Indiana
Dubois
Co
<
0.05
Indiana
Lake
Co
<
0.05
Indiana
Marion
Co
<
0.05
Indiana
Vanderburgh
Co
<
0.05
Kentucky
Fayette
Co
<
0.05
Kentucky
Jefferson
Co
<
0.05
Maryland
Anne
Arundel
Co
0.11
Maryland
Baltimore
city
0.10
Michigan
Wayne
Co
<
0.05
New
York
New
York
Co
0.21
North
Carolina
Catawba
Co
<
0.05
North
Carolina
Davidson
Co
<
0.05
Ohio
Butler
Co
<
0.05
Ohio
Cuyahoga
Co
<
0.05
Ohio
Franklin
Co
<
0.05
Ohio
Hamilton
Co
<
0.05
Ohio
Jefferson
Co
<
0.05
Ohio
Lawrence
Co
<
0.05
Ohio
Mahoning
Co
<
0.05
Ohio
Montgomery
Co
<
0.05
Ohio
Scioto
Co
<
0.05
Ohio
Stark
Co
<
0.05
Ohio
Summit
Co
<
0.05
Pennsylvania
Allegheny
Co
<
0.05
Pennsylvania
Beaver
Co
<
0.05
Pennsylvania
Berks
Co
0.13
Pennsylvania
Cambria
Co
<
0.05
Pennsylvania
Dauphin
Co
0.09
Pennsylvania
Delaware
Co
0.15
28
State
County
PM2.5
Contribution
Pennsylvania
Lancaster
Co
0.15
Pennsylvania
Philadelphia
Co
0.15
Pennsylvania
Washington
Co
<
0.05
Pennsylvania
Westmoreland
Co
<
0.05
Pennsylvania
York
Co
0.12
Tennessee
Hamilton
Co
<
0.05
Tennessee
Knox
Co
<
0.05
West
Virginia
Berkeley
Co
<
0.05
West
Virginia
Brooke
Co
<
0.05
West
Virginia
Cabell
Co
<
0.05
West
Virginia
Hancock
Co
<
0.05
West
Virginia
Kanawha
Co
<
0.05
West
Virginia
Marion
Co
<
0.05
West
Virginia
Marshall
Co
<
0.05
West
Virginia
Ohio
Co
<
0.05
West
Virginia
Wood
Co
<
0.05
IV.
FINDINGS
AND
ACTION
A.
Findings
of
Significant
Contribution
for
Delaware
and
New
Jersey
We
find
that
emissions
of
the
PM2.5
precursors
SO2
and
NOx
emitted
by
Delaware
and
New
Jersey
contribute
significantly
to
nonattainment
of
the
PM2.5
NAAQS
in
New
York.
Accordingly,
we
are
finalizing
SIP
requirements
for
Delaware
and
New
Jersey
under
section
110(
a)(
1)
to
meet
the
requirements
of
section
110(
a)(
2)(
D)(
i),
namely,
to
contain
adequate
provisions
to
prohibit
SO2
and
NOx
emissions
from
sources
or
activities
within
the
States
from
"
contribut[
ing]

significantly
to
nonattainment"
of
the
PM2.5
NAAQS
in
downwind
States.

B.
SIP
Approval
Criteria
29
The
CAIR
added
two
new
sections
to
title
40
of
the
Code
of
Federal
Regulations,
§
§
51.123
and
51.124
containing
requirements
related
to
NOx
and
SO2
respectively,
which
establish
the
requirement
for
submission
of
SIP
revisions
to
comply
with
the
CAIR
and
the
criteria
which
EPA
will
use
to
review
these
revisions
for
approval
or
disapproval.
The
content
of
these
sections
is
presented
in
section
VII
of
the
preamble
to
the
CAIR.
Delaware
and
New
Jersey
are
already
subject
to
the
ozone­
related
provisions
of
these
sections
but
not
to
the
provisions
that
relate
to
PM2.5.
We
are
amending
these
two
sections
to
extend
the
PM2.5­
related
provisions
to
both
States.
The
practical
effect
of
the
amendments
will
be
to
subject
the
States
to
budgets
(
if
they
choose
to
control
large
EGUs)
for
annual
emission
reduction
requirements
of
NOx
and
SO2.

Delaware
and
New
Jersey
statewide
annual
emissions
budgets
The
NOx
and
SO2
annual
and
ozone
season
budgets
for
New
Jersey
and
Delaware
are
shown
below
in
Tables
IV­
1
and
IV­
2.

Table
IV­
1.
Annual
NOx
Budgets
(
tons)

Year
Delaware
New
Jersey
2009
4,166
12,670
2015
3,472
10,558
Table
IV­
2.
Annual
SO2
Budgets
(
tons)

Year
Delaware
New
Jersey
30
2010
22,411
32,392
2015
15,687
22,674
State
annual
SO2
budgets
for
the
years
2010­
2014
(
Phase
I)
are
based
on
a
50
percent
reduction
from
title
IV
allocations
for
all
units
in
the
affected
State.
The
State
annual
budgets
for
2015
and
beyond
(
Phase
II)
are
based
on
a
65
percent
reduction
from
title
IV
allowances
allocated
to
units
in
the
affected
State
for
SO2
control.

The
EPA
calculated
State
NOx
budgets
through
a
fueladjusted
heat­
input
basis,
as
in
the
CAIR.
State
budgets
were
determined
by
multiplying
historic
heat
input
data
(
summed
by
fuel)
by
different
adjustment
factors
for
the
different
fuels.
These
factors
reflect
the
relative
differences
in
the
average
NOx
emissions
rates
for
each
fuel
type.
The
average
NOx
emissions
rates
were
derived
by
totaling
1999
through
2001
heat
input
and
emissions
for
each
fuel
type
(
i.
e.,
coal,
natural
gas,
and
oil),
in
each
State.

The
resulting
adjustment
factors
from
this
calculation
are
1.0
for
coal,
0.4
for
gas
and
0.6
for
oil.
The
factors
reflect
the
inherently
higher
emissions
rate
of
coal­
fired
plants,
and
consequently
the
greater
burden
on
coal
plants
to
control
emissions.
The
regional
budget
was
then
apportioned
to
States
on
a
pro­
rata
basis,
based
on
each
State's
share
of
total
adjusted
average
heat
input.
For
a
31
more
detailed
discussion
of
how
the
budgets
were
calculated,

see
the
proposal
(
70
FR
25416).

Compliance
Supplement
Pool
(
CSP)
allowances
and
the
statewide
budgets
The
final
CAIR
annual
NOx
cap
and
trade
rule
provides
additional
incentives
for
early
annual
NOx
reductions
by
creating
a
CSP
for
CAIR
States
from
which
they
can
distribute
allowances
for
early,
annual
NOx
emissions
reductions
in
the
years
2007
and
2008.
The
CSP
functions
much
like
the
NOx
SIP
Call's
CSP.
The
CSP
is
comprised
of
CAIR
annual
NOx
allowances
of
vintage
year
2009.

In
the
final
CAIR,
EPA
apportions
a
200,000
ton
CSP
to
all
States
in
the
CAIR
region.
The
CSP
was
apportioned
based
on
a
State's
share
of
the
required
emissions
reductions
(
i.
e.,
the
difference
between
their
State
baseline
emissions
and
their
projected
emissions
under
the
CAIR).
States
may
distribute
these
CAIR
NOx
allowances
to
sources
based
upon
either:
(
1)
a
demonstration
to
the
State
of
NOx
emissions
reductions
in
surplus
of
any
existing
NOx
emission
control
requirements;
or
(
2)
a
demonstration
to
the
State
that
the
facility
has
a
"
need"
that
would
affect
electricity
grid
reliability;
or,
another
method
chosen
by
the
State.
Sources
that
wish
to
receive
CAIR
CSP
allowances
can
be
awarded
one
CAIR
annual
NOx
allowance
for
every
ton
32
of
NOx
emissions
reductions.
(
Should
a
State
receive
more
requests
for
allowances
than
their
share
of
the
CAIR
CSP,

the
State
would
pro­
rate
the
allowance
distribution.)

Determination
of
surplus
emissions
must
use
emissions
data
measured
using
part
75
monitoring.

The
CSP
for
CAIR
States
affected
by
the
CAIR
NFR
has
a
total
of
198,494
CAIR
NOx
allowances
in
addition
to
the
annual
CAIR
NOx
budgets.
With
Delaware
and
New
Jersey
as
part
of
the
final
CAIR
program,
they
will
be
allotted
an
additional
1,503
allowances.
Table
IV­
3
shows
the
NOx
CSP
for
New
Jersey
and
Delaware.

Table
IV­
3.
NOx
Compliance
Supplement
Pool
(
tons)

Delaware
New
Jersey
843
660
C.
SIP
Submittal
Deadline
We
are
also
finalizing
the
requirement
that
PM2.5
transport
SIPs
be
submitted,
under
CAA
section
110(
a)(
1),
as
soon
as
practicable,
but
not
later
than
18
months
from
the
date
of
signature
of
the
CAIR,
i.
e.,
September
11,
2006.

While
EPA
did
not
receive
public
comment
regarding
the
proposed
Delaware
and
New
Jersey
CAIR
SIP
revision
for
PM2.5,
EPA
notes
that
this
deadline
will
be
less
than
18
months
from
today's
final
action
and
less
than
the
12
month
timeline
EPA
had
expected
at
the
time
of
the
publication
of
33
the
Delaware
and
New
Jersey
CAIR
proposal.
However,
we
continue
to
believe
that
Delaware
and
New
Jersey
have
sufficient
time
to
develop
and
submit
CAIR
SIP
revisions
for
the
following
reasons.

First,
Delaware
and
New
Jersey
were
included
in
the
initial
CAIR
finding
of
significant
contribution
for
PM2.5
precursors,
so
Delaware
and
New
Jersey
have
been
aware
that
they
might
have
to
submit
transport
SIPs
for
PM2.5
since
the
CAIR
proposal
was
published
on
January
30,
2004.
Moreover,

we
are
adopting
all
of
the
key
features
of
the
initial
CAIR
proposal,
including
the
same
annual
SO2
and
NOx
reductions
and
budgets
and
the
same
implementation
mechanisms.
In
addition,
Delaware
and
New
Jersey
have
been
aware
of
the
CAIR
model
trading
rules,
which
they
may
choose
to
adopt
as
a
highly
cost­
effective
control
remedy,
for
the
same
length
of
time
as
the
other
CAIR
States.
Again,
since
these
States
have
been
on
notice
regarding
these
issues,
we
believe
that
it
is
reasonable
to
require
Delaware
and
New
Jersey
to
submit
their
CAIR
SIP
revisions
for
PM2.5
on
the
same
timeline
as
other
CAIR
PM2.5
States.

The
EPA
modeling
projects
that,
when
Delaware
and
New
Jersey
are
included
in
the
CAIR
SO2
and
NOx
annual
trading
programs,
these
States
would
achieve
the
required
emissions
reductions
with
limited
installation
of
advanced
emissions
34
controls.
Specifically,
EPA
modeling
projected
the
installation
of
one
flue
gas
desulfurization
(
FGD)
control
device
in
New
Jersey.
8
By
requiring
the
Delaware
and
New
Jersey
CAIR
SIP
revisions
by
September
11,
2006,
sources
will
have
40
months
to
plan
and
install
the
one
additional
FGD
device
EPA
predicts
will
be
installed.
This
exceeds
the
27
months
EPA
estimates
it
takes
for
the
installation
of
an
FGD
device.
Also,
we
believe
sufficient
boiler
maker
labor
and
other
resources
exist
to
support
one
additional
FGD
device
installation
by
January
1,
2010.

For
all
these
reasons,
also
put
forth
in
the
Delaware
and
New
Jersey
NPR,
we
think
it
reasonable
that
Delaware
and
New
Jersey
submit
PM2.5
transport
SIPs
by
September
11,

2006.

D.
Emissions
Reporting
Requirements
8
The
EPA
modeling
shows
that
no
additional
selective
catalytic
reduction
(
SCR)
units
would
be
required
in
the
two
States.
Analysis
is
based
upon
comparisons
of
projected
emissions
control
equipment
retrofits
in
IPM
runs
with
and
without
Delaware
and
New
Jersey.
See
IPM
runs
("
CAIR
2004
Final
DE
and
NJ")
in
the
docket
for
further
details.
In
order
to
provide
emissions
inventory
information
35
that
will
allow
EPA
to
better
monitor
the
implementation
and
effects
of
the
CAIR's
emissions
reductions,
EPA
incorporated
into
the
CAIR
the
pre­
existing
emission
inventory
reporting
requirements
applicable
to
States
affected
by
the
CAIR.

Those
CAIR
requirements
were
specific
to
whether
a
State
was
affected
by
the
annual
emissions
reduction
requirements
for
SO2
and
NOx
or
only
the
ozone­
season
reduction
requirements
for
NOx.
Because
we
are
applying
the
annual
emissions
reduction
requirements
to
Delaware
and
New
Jersey,
we
are
also
placing
these
two
States
under
the
corresponding
provisions
of
the
emissions
reporting
requirements.
The
only
practical
effect
of
this
change
relative
to
existing
requirements
is
that
if
either
State
chooses
to
obtain
some
of
the
required
annual
emissions
reductions
from
a
source
which
emits
less
than
2,500
tons/
year
of
both
SO2
and
NOx
and
that
source
is
not
also
made
subject
to
the
EPA­
operated
emissions
trading
programs,
the
State
must
report
the
annual
emissions
of
that
source
to
EPA
annually
in
contrast
to
the
triennial
requirement
that
presently
applies
to
such
sources.

V.
EXPECTED
EFFECTS
OF
THIS
ACTION
A.
Emissions
The
EPA
has
conducted
power
sector
analysis
of
the
CAIR
using
the
IPM.
The
IPM
is
a
dynamic
linear
programming
36
model
that
can
be
used
to
examine
air
pollution
control
policies
for
SO2
and
NOx
throughout
the
contiguous
United
States
for
the
entire
power
system.
Documentation
for
IPM
can
be
found
at
www.
epa.
gov/
airmarkets/
epa­
ipm.

Emissions
of
SO2
and
NOx
in
the
CAIR
region
would
be
higher
under
the
final
CAIR
where
Delaware
and
New
Jersey
are
only
included
in
a
summer
season
ozone
cap,
similar
to
Connecticut
and
Massachusetts.
Since
these
two
States
are
being
included
as
part
of
the
annual
SO2
and
NOx
caps
for
the
CAIR,
emissions
in
the
region
will
be
reduced
by
another
48,000
tons
of
SO2
and
11,000
tons
of
NOx
from
the
final
CAIR
scenario
by
2015.

The
inclusion
of
Delaware
and
New
Jersey
in
the
annual
CAIR
requirements
will
result
in
additional
reductions
of
SO2
and
NOx
that
will
help
achieve
attainment
in
downwind
States.
These
additional
reductions
are
shown
in
Table
V­
1.

Table
V­
1.
Annual
Emissions
from
Affected
Sources
for
The
CAIR
Region9
(
thousand
tons)

2010
2015
SO2
NOx
SO2
NOx
Base
Case
8,868
2,826
8,056
2,853
9
The
CAIR
region
for
purposes
of
this
table
includes
the
following
States:
Alabama,
Arkansas,
Connecticut,
Delaware,
District
of
Columbia,
Florida,
Georgia,
Illinois,
Indiana,
Iowa,
Kentucky,
Louisiana,
Maryland,
Massachusetts,
Michigan,
Minnesota,
Mississippi,
Missouri,
New
Jersey,
New
York,
North
Carolina,
Ohio,
Pennsylvania,
South
Carolina,
Tennessee,
Texas,
Virginia,
West
Virginia,
Wisconsin.
37
Final
CAIR
(
DE
and
NJ
Included
for
Ozone
Season
NOx
Only)
5,336
1,592
4,216
1,342
CAIR
Modified
By
This
Rule
(
DE
and
NJ
Included
for
Annual
SO2
and
NOx)
5,305
1,582
4,168
1,331
Difference
between
CAIR
Scenarios
32
10
48
11
Note:
Numbers
may
not
add
due
to
rounding.

B.
Air
Quality
Section
VI
of
the
preamble
to
the
CAIR
describes
the
air
quality
modeling
performed
to
determine
the
projected
impacts
of
the
CAIR
on
PM2.5
and
8­
hour
ozone
of
the
SO2
and
NOx
emissions
reductions
in
the
control
region
modeled.
The
modeling
used
to
estimate
the
air
quality
impact
of
these
reductions
assumed
annual
SO2
and
NOx
controls
for
Arkansas,

Delaware,
and
New
Jersey
(
as
had
been
proposed
before
completion
of
the
final
contribution
analysis)
in
addition
to
the
23
States
plus
the
District
of
Columbia.
Since
Arkansas,
Delaware,
and
New
Jersey
are
not
included
in
the
final
CAIR
PM2.5
region,
the
modeled
estimated
impacts
are
overstated
for
the
final
CAIR
which
excludes
all
three
States
from
the
CAIR
region
for
PM2.5.
Because
Delaware
and
New
Jersey
now
are
subject
to
the
PM2.5­
related
emissions
limits
for
SO2
and
NOx,
the
air
quality
modeling
for
the
final
CAIR
better
approximates
the
net
effects
of
the
CAIR
plus
today's
rule,
but
still
overestimates
the
air
quality
38
changes
somewhat
due
to
the
continued
discrepancy
regarding
Arkansas.
The
Regulatory
Impact
Analysis
for
the
CAIR
discusses
these
differences
in
scenarios
in
more
detail.

The
EPA
analyzed
the
impacts
of
the
regional
emissions
reductions
in
both
2010
and
2015.
These
impacts
are
quantified
by
comparing
air
quality
modeling
results
for
the
regional
control
scenario
to
the
modeling
results
for
the
corresponding
2010
and
2015
base
case
scenarios.
The
2010
and
2015
emissions
reductions
and
air
quality
improvements
from
the
regional
control
strategy
modeled
are
presented
in
summary
form
in
section
VI
of
the
preamble
to
the
CAIR
and
in
detail
in
the
Emission
Inventory
Technical
Support
Document
and
the
Air
Quality
Modeling
Technical
Support
Document
for
the
CAIR.

The
EPA
estimates,
based
on
the
air
quality
analysis
for
the
CAIR,
that
the
required
SO2
and
NOx
emissions
reductions
would,
by
themselves,
bring
into
attainment
52
of
the
80
counties
that
are
otherwise
expected
to
be
in
nonattainment
for
PM2.5
in
2010,
and
57
of
the
75
counties
that
are
otherwise
expected
to
be
in
nonattainment
for
PM2.5
in
2015.
The
EPA
further
estimates
that
the
required
NOx
emissions
reductions
would,
by
themselves,
bring
into
attainment
3
of
the
40
counties
that
are
otherwise
expected
to
be
in
nonattainment
for
8­
hour
ozone
in
2010,
and
6
of
39
the
22
counties
that
are
expected
to
be
in
nonattainment
for
8­
hour
ozone
in
2015.
In
addition,
today's
rule
will
improve
PM2.5
and
8­
hour
ozone
air
quality
in
the
areas
that
will
remain
nonattainment
for
those
two
NAAQS
after
implementation
of
today's
rule.
Because
of
today's
rule,

the
States
with
those
remaining
nonattainment
areas
will
find
it
less
burdensome
and
less
expensive
to
reach
attainment
by
adopting
additional
local
controls.
The
CAIR
will
also
reduce
PM2.5
and
8­
hour
ozone
levels
in
attainment
areas.

We
have
not
conducted
an
incremental
analysis
of
the
air
quality
effects
from
the
proposed
extension
of
the
annual
emissions
reductions
requirements
to
New
Jersey
and
Delaware.
However,
IPM
modeling
of
EGU
emissions
indicates
that
assuming
that
all
States
join
the
EPA
trading
programs,

highly
cost­
effective
emissions
reductions
will
be
distributed
across
the
region
in
addition
to
Delaware
and
New
Jersey
themselves,
and
contribute
to
the
attainment
of
these
two
States'
downwind
neighbors
as
well
as
other
States
with
nonattainment
areas.

VI.
STATUTORY
AND
EXECUTIVE
ORDER
REVIEWS
A.
Executive
Order
12866:
Regulatory
Planning
and
Review
Under
Executive
Order
12866
(
58
FR
51735,
October
4,

1993),
the
Agency
must
determine
whether
a
regulatory
action
40
is
"
significant"
and
therefore
subject
to
Office
of
Management
and
Budget
(
OMB)
review
and
the
requirements
of
the
Executive
Order.
The
Order
defines
"
significant
regulatory
action"
as
one
that
is
likely
to
result
in
a
rule
that
may:

1.
Have
an
annual
effect
on
the
economy
of
$
100
million
or
more
or
adversely
affect
in
a
material
way
the
economy,
a
sector
of
the
economy,
productivity,
competition,
jobs,
the
environment,
public
health
or
safety,
or
State,
local,
or
Tribal
governments
or
communities;

2.
Create
a
serious
inconsistency
or
otherwise
interfere
with
an
action
taken
or
planned
by
another
agency;

3.
Materially
alter
the
budgetary
impact
of
entitlements,

grants,
user
fees,
or
loan
programs
or
the
rights
and
obligations
of
recipients
thereof;
or
4.
Raise
novel
legal
or
policy
issues
arising
out
of
legal
mandates,
the
President's
priorities,
or
the
principles
set
forth
in
the
Executive
Order.

In
view
of
its
important
policy
implications
and
potential
effect
on
the
economy
of
over
$
100
million,
this
rule
and
the
CAIR
program
inclusive
of
this
rule
has
been
judged
to
be
an
economically
"
significant
regulatory
action"

within
the
meaning
of
the
Executive
Order.
As
a
result,

today's
rule
was
submitted
to
OMB
for
review,
and
EPA
41
prepared
an
economic
analysis
of
the
CAIR
program
including
this
rule
entitled
"
Regulatory
Impact
Analysis
of
the
Final
Clean
Air
Interstate
Rule"
(
March
2005).

1.
What
Economic
Analyses
Were
Conducted
for
the
Rulemaking?

The
analyses
conducted
for
the
CAIR
program
(
CAIR
final
rule
plus
this
New
Jersey
and
Delaware
rule)
provide
several
important
analyses
of
impacts
on
public
welfare.
These
include
an
analysis
of
the
social
benefits,
social
costs,

and
net
benefits
of
the
regulatory
scenario.
The
economic
analyses
also
address
issues
involving
small
business
impacts,
unfunded
mandates
(
including
impacts
for
Tribal
governments),
environmental
justice,
children's
health,

energy
impacts,
and
requirements
of
the
Paperwork
Reduction
Act.

2.
What
Are
the
Benefits
and
Costs
of
the
CAIR
Program?

The
benefit­
cost
analysis
shows
that
substantial
net
economic
benefits
to
society
are
likely
to
be
achieved
due
to
reduction
in
emissions
resulting
from
the
CAIR
program
that
includes
annual
SO2
and
NOx
controls
for
New
Jersey
and
Delaware.
The
results
show
that
the
CAIR
program
would
be
highly
beneficial
to
society,
with
annual
net
benefits
(
benefits
less
costs)
of
approximately
$
71.4
or
$
60.4
billion
in
2010
and
$
98.5
or
$
83.2
billion
in
2015.
These
42
alternative
net
benefits
estimates
occur
due
to
differing
assumptions
concerning
the
social
discount
rate
used
to
estimate
the
annual
value
of
the
benefits
of
the
rule
with
the
lower
estimates
relating
to
a
discount
rate
of
7
percent
and
the
higher
estimates
a
discount
rate
of
3
percent.
All
amounts
are
reflected
in
1999
dollars.
For
more
information,
see
the
NFR
for
the
CAIR
published
in
the
Federal
Register
(
70
FR
25162;
May
12,
2005)
and
the
Regulatory
Impact
Analysis
for
the
Final
Clean
Air
Interstate
Rule
(
March
2005).

3.
What
Are
the
Incremental
Costs
to
the
Power
Industry
Associated
with
this
New
Jersey
and
Delaware
Rule?

The
costs
presented
here
represent
the
total
incremental
cost
to
the
electric
power
industry
of
reducing
NOx
and
SO2
emissions
to
meet
the
reduction
requirements
set
forth
in
the
rule,
assuming
all
States
participate
in
a
regionwide
cap
and
trade
program.
These
costs
estimates
are
referred
to
as
private
costs,
and
these
estimates
differ
from
the
cost
of
the
program
to
society
or
social
cost
estimates
presented
for
the
CAIR
program
discussed
previously.
As
shown
in
Table
VI­
1,
EPA
estimates
the
annual
private
costs
of
this
rule
to
include
Delaware
and
New
Jersey
in
the
CAIR
are
approximately
$
30
million
in
2010
and
$
40
million
in
2015.
All
estimates
reflect
1999
dollars.
Overall,
the
impacts
of
the
CAIR
program
are
modest,
particularly
in
light
of
the
large
benefits
we
expect.
Delaware
and
New
Jersey
are
part
of
the
PJM
electricity
region,
which
is
an
extremely
large
regional
transmission
organization
that
manages
electricity
movement
43
through
several
Mid­
Atlantic
and
Mid­
Western
States.
PJM
ensures
that
plants
are
operated
efficiently
and
power
is
supplied
reliably
and
safely.
Other
States
already
in
CAIR
are
also
part
of
PJM,
and
EPA
does
not
anticipate
that
retail
electricity
prices
will
be
greatly
affected
by
CAIR,

inclusive
of
this
rule
to
include
Delaware
and
New
Jersey.

Retail
electricity
prices
are
projected
to
increase
roughly
2.0
­
2.6
percent
with
the
CAIR
program
(
inclusive
of
this
rule)
in
the
2010
and
2015
timeframe,
and
then
drop
below
2.0
percent
thereafter.
For
MAAAC
Power
Region,
which
includes
Delaware
and
New
Jersey,
retail
electricity
prices
are
projected
to
increase
roughly
3.2
to
3.4
percent
with
the
CAIR
program
(
inclusive
of
this
rule)
in
the
2010
and
2015
timeframe,
and
then
drop
below
1.0
percent
thereafter.

The
effects
of
the
CAIR
program
on
natural
gas
prices
and
the
electric
power
industry
generation
mix
are
also
small,

with
a
1.6
percent
or
less
increase
in
natural
gas
prices
projected
from
2010
to
2020.

With
the
Delaware
and
New
Jersey
rule
and
the
CAIR,
we
estimate
there
will
be
continued
reliance
on
coal­
fired
generation.
Coal­
fired
generation
is
projected
to
remain
at
roughly
50
percent
of
total
electricity
generated.
A
relatively
small
amount
of
coal­
fired
capacity,
about
5.2
GW10
(
1.7
percent
of
all
coal­
fired
capacity
and
0.5
percent
of
all
generating
capacity),
is
projected
to
be
uneconomic
to
maintain.
For
the
most
part,
these
units
are
small
and
infrequently
used
generating
units
that
are
dispersed
throughout
the
CAIR
region.
Units
projected
to
be
uneconomic
to
maintain
may
be
"
mothballed,"
retired,
or
kept
in
service
to
ensure
transmission
reliability
in
certain
parts
of
the
grid.

10
0.5
GW
of
this
capacity
occurs
as
a
result
of
the
inclusion
of
Delaware
and
New
Jersey
in
CAIR.
44
As
demand
grows
in
the
future,
additional
coal­
fired
generation
is
projected
to
be
built
under
the
CAIR
program.

As
a
result,
both
coal­
fired
generation
and
coal
production
for
electricity
generation
are
projected
to
increase
from
2003
levels
by
about
15
percent
in
2010
and
25
percent
by
2020,
and
we
expect
a
small
shift
towards
greater
coal
production
in
Appalachia
and
the
interior
coal
regions
of
the
country
with
the
CAIR.

For
today's
rule,
EPA
analyzed
the
costs
and
other
economic
inputs
using
the
IPM
described
earlier
and
the
EPA
Retail
Pricing
Model
(
RPM).
The
additional
annualized
incremental
costs
of
including
Delaware
and
New
Jersey
in
the
CAIR
program
primarily
occur
because
of
the
additional
installation
and
operation
of
a
modest
amount
of
pollution
control
equipment.

Table
VI­
1.
Annualized
Incremental
Private
Costs
for
the
CAIR
Region
with
and
without
Delaware
and
New
Jersey
(
billions
of
1999
dollars)

Program
Costs
in
2010
Costs
in
2015
Final
CAIR
(
DE
and
NJ:
Ozone
Season
NOx
Only)
$
2.53
$
3.85
Final
CAIR
plus
NJ
and
DE
proposal
(
DE
and
NJ:
Annual
SO2
and
NOx)
$
2.56
$
3.89
Difference
between
CAIR
scenarios
$
0.03
$
0.04
Source:
EPA
2004­
2005,
Integrated
Planning
Model.
Results
45
differ
from
those
reported
in
the
CAIR
RIA
reflecting
more
recent
modeling
results
for
the
CAIR.
4.
What
Potential
Benefits
May
Be
Associated
with
this
Rule?

Air
quality
modeling
was
not
conducted
for
the
New
Jersey
and
Delaware
rule.
For
this
reason,
an
analysis
of
the
potential
benefits
for
the
New
Jersey
and
Delaware
rule
cannot
be
determined
with
any
degree
of
specificity.

However,
based
on
the
air
quality
modeling
results
for
the
CAIR,
we
can
make
"
ball
park"
estimates
of
the
benefits
and
net
benefits
that
might
occur
with
this
rule.
Including
New
Jersey
and
Delaware
in
the
CAIR
program
would
result
in
additional
reductions
of
SO2
and
NOx
emissions.
This
"
ball
park"
estimate
approach
assumes
the
benefits­
per­
ton
for
reductions
of
SO2
and
NOx
emissions
for
Delaware
and
New
Jersey
will
equate
to
the
average
benefits­
per­
ton
resulting
from
the
CAIR
program.
Using
this
approach,
we
estimate
that
approximately
$
630
million
of
the
total
annual
CAIR
program
benefits
previously
discussed
are
attributable
to
annual
SO2
and
NOx
controls
for
New
Jersey
and
Delaware
in
2010.
This
estimate
increases
to
over
$
1.1
billion
in
2015.

The
full
CAIR
analysis
including
New
Jersey
and
Delaware
showed
a
benefit­
cost
ratio
of
as
high
as
39:
1
in
2015.

Based
on
the
relatively
low
estimated
private
costs
of
including
New
Jersey
and
Delaware
of
$
30
million
in
2010
and
46
$
40
million
in
2015,
it
is
highly
likely
that
benefits
would
exceed
the
costs
of
including
Delaware
and
New
Jersey
in
the
CAIR
even
if
benefits
of
controlling
SO2
and
NOx
for
New
Jersey
and
Delaware
are
substantially
lower
than
the
average
benefit
estimates
for
the
CAIR
in
general.
It
is
highly
unlikely
that
benefits
are
much
lower
than
the
average
given
the
urban
nature
of
much
of
New
Jersey,
and
the
proximity
of
New
Jersey
and
Delaware
to
many
heavily
populated
urban
areas.

B.
Paperwork
Reduction
Act
The
information
collection
requirements
in
this
rule
have
been
submitted
for
approval
to
the
OMB
under
the
Paperwork
Reduction
Act,
44
U.
S.
C.
3501
et
seq.
The
Information
Collection
Request
(
ICR)
document
prepared
by
EPA
has
been
assigned
EPA
ICR
number
2184.01.

The
purpose
of
the
ICR
is
to
estimate
the
anticipated
monitoring,
reporting,
and
recordkeeping
burden
estimates
and
associated
costs
for
States,
local
governments,
and
sources
that
are
expected
to
result
from
this
final
rule.

This
ICR
describes
the
nature
of
the
information
collection
and
the
estimated
burden
for
this
rule.
In
cases
where
information
is
already
collected
by
a
related
program,
the
ICR
takes
into
account
only
the
additional
burden.
This
situation
arises
in
States
that
are
also
subject
to
47
requirements
of
the
Consolidated
Emissions
Reporting
Rule
(
EPA
ICR
number
0916.10;
OMB
control
number
2060­
0088)
or
for
sources
that
are
subject
to
the
Acid
Rain
Program
(
EPA
ICR
2152.01;
EPA
ICR
number
1633.13;
OMB
control
number
2060­
0258)
or
NOx
SIP
Call
(
EPA
ICR
number
1857.03;
OMB
control
number
2060­
0445)
requirements.

The
total
monitoring,
recordkeeping,
and
reporting
burden
to
sources
resulting
from
Delaware
and
New
Jersey
choosing
to
participate
in
a
regional
cap
and
trade
program
are
expected
to
be
approximately
$
270,000
at
the
time
the
monitors
are
initially
used.
This
estimate
includes
the
annualized
cost
of
installing
and
operating
appropriate
SO2
and
NOx
emissions
monitoring
equipment
to
measure
and
report
the
total
emissions
of
these
pollutants
from
affected
EGUs
(
serving
generators
greater
than
25
megawatt
capacity)
for
this
rule.
The
burden
to
State
and
local
air
agencies
includes
any
necessary
SIP
revisions,
performing
monitoring
certification,
and
fulfilling
audit
responsibilities.

Burden
means
the
total
time,
effort,
or
financial
resources
expended
by
persons
to
generate,
maintain,
retain,

or
disclose
or
provide
information
to
or
for
a
Federal
agency.
This
includes
the
time
needed
to
review
instructions;
develop,
acquire,
install,
and
utilize
technology
and
systems
for
the
purposes
of
collecting,
48
validating,
and
verifying
information,
processing
and
maintaining
information,
and
disclosing
and
providing
information;
adjust
the
existing
ways
to
comply
with
any
previously
applicable
instructions
and
requirements;
train
personnel
to
be
able
to
respond
to
a
collection
of
information;
search
data
sources;
complete
and
review
the
collection
of
information;
and
transmit
or
otherwise
disclose
the
information.

An
agency
may
not
conduct
or
sponsor,
and
a
person
is
not
required
to
respond
to
a
collection
of
information
unless
it
displays
a
currently
valid
OMB
control
number.

The
OMB
control
numbers
for
EPA's
regulations
in
40
CFR
are
listed
in
40
CFR
part
9.

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
49
on
small
entities,
small
entity
is
defined
as:
(
1)
a
small
business
that
is
identified
by
the
North
American
Industry
Classification
System
(
NAICS)
Code,
as
defined
by
the
Small
Business
Administration
(
SBA);
(
2)
a
small
governmental
jurisdiction
that
is
a
government
of
a
city,
county,
town,

school
district
or
special
district
with
a
population
of
less
that
50,000;
and
(
3)
a
small
organization
that
is
any
not­
for­
profit
enterprise
which
is
independently
owned
and
operated
and
is
not
dominant
in
its
field.
Table
VI­
2
lists
entities
potentially
impacted
by
this
rule
with
applicable
NAICS
codes.

VI­
2.
Potentially
Regulated
Categories
and
Entities
Category
NAICS
Code1
Examples
of
Potentially
Regulated
Entities
Industry
221112
Fossil
fuel­
fired
electric
utility
steam
generating
units.

Federal
Government
2211122
Fossil
fuel­
fired
electric
utility
steam
generating
units
owned
by
the
Federal
government.

State/
local/
Tribal
Government
2211122
921150
Fossil
fuel­
fired
electric
utility
steam
generating
units
owned
by
municipalities.

Fossil
fuel­
fired
electric
utility
steam
generating
units
in
Indian
Country.
1
North
American
Industry
Classification
System.

2
Federal,
State,
or
local
government­
owned
and
operated
establishments
are
classified
according
to
the
activity
in
which
they
are
engaged.
50
According
to
the
SBA
size
standards
for
NAICS
code
221112
Utilities­
Fossil
Fuel
Electric
Power
Generation,
a
firm
is
small
if,
including
its
affiliates,
it
is
primarily
engaged
in
the
generation,
transmission,
and
or
distribution
of
electric
energy
for
sale
and
its
total
electric
output
for
the
preceding
fiscal
year
did
not
exceed
4
million
megawatt
hours.

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.
This
final
rule
will
not
impose
any
requirements
on
small
entities.
Courts
have
interpreted
the
RFA
to
require
a
regulatory
flexibility
analysis
only
when
small
entities
will
be
subject
to
the
requirements
of
the
rule.
See
Michigan
v.
EPA,
213
F.
3d
663,
668­
69
(
D.
C.
Cir.,

2000),
cert.
den.
121
S.
Ct.
225,
149
L.
Ed.
2d
135
(
2001).

This
rule
would
not
establish
requirements
applicable
to
small
entities.
Instead,
this
rule
requires
New
Jersey
and
Delaware
to
develop,
adopt,
and
submit
SIP
revisions
that
would
achieve
the
necessary
SO2
and
NOx
emissions
reductions,
and
would
leave
to
the
States
the
task
of
determining
how
to
obtain
those
reductions,
including
which
entities
to
regulate.
Moreover,
because
these
States
would
51
have
discretion
to
choose
the
sources
to
regulate
and
how
much
emissions
reductions
each
selected
source
would
have
to
achieve,
EPA
could
not
predict
the
effect
of
the
rule
on
small
entities.
Although
not
required
by
the
RFA,
the
Agency
has
conducted
a
small
business
analysis
for
the
CAIR
program
inclusive
of
the
New
Jersey
and
Delaware
proposal.

Overall,
about
445
MW
of
total
small
entity
capacity,

or
1.0
percent
of
total
small
entity
capacity
in
the
CAIR
region,
is
projected
to
be
uneconomic
to
maintain
under
the
CAIR
relative
to
the
base
case.
In
practice,
units
projected
to
be
uneconomic
to
maintain
may
be
"
mothballed,"

retired,
or
kept
in
service
to
ensure
transmission
reliability
in
certain
parts
of
the
grid.
Our
IPM
modeling
is
unable
to
distinguish
between
these
potential
outcomes.

The
EPA
modeling
identified
264
small
power­
generating
entities
within
the
entire
CAIR
region
based
upon
the
definition
of
small
entity
outlined
above.
The
EPA
excluded
from
this
analysis
189
small
entities
that
were
not
projected
to
have
at
least
one
unit
with
a
generating
capacity
of
25
MW
or
great
operating
in
the
base
case.

Thus,
we
found
that
75
small
entities
may
potentially
be
affected
by
the
CAIR
program.
Of
these
75
small
entities,

28
may
experience
compliance
costs
in
excess
of
1
percent
of
revenues
in
2010,
and
46
may
in
2015,
based
on
the
Agency's
52
assumptions
of
how
the
affected
States
implement
control
measures
to
meet
their
emissions
budgets
as
set
forth
in
this
rulemaking.
Potentially
affected
small
entities
experiencing
compliance
costs
in
excess
of
1
percent
of
revenues
have
some
potential
for
significant
impact
resulting
from
implementation
of
the
CAIR.
However,
it
is
the
Agency's
position
that
because
none
of
the
affected
entities
currently
operate
in
a
competitive
market
environment,
they
should
be
able
to
pass
the
costs
of
complying
with
the
CAIR
on
to
rate­
payers.
Moreover,
the
decision
to
include
only
units
greater
than
25
MW
in
size
exempts
185
small
entities
that
would
otherwise
be
potentially
affected
by
the
CAIR.

Two
other
points
should
be
considered
when
evaluating
the
impact
of
the
CAIR
program
(
inclusive
of
the
New
Jersey
and
Delaware
rule),
specifically,
and
cap
and
trade
programs
more
generally,
on
small
entities.
First,
under
the
CAIR
program,
the
cap
and
trade
program
is
designed
such
that
States
determine
how
NOX
allowances
are
to
be
allocated
across
units.
A
State
that
wishes
to
mitigate
the
impact
of
the
rule
on
small
entities
might
choose
to
allocate
NOx
allowances
in
a
manner
that
is
favorable
to
small
entities.

Finally,
the
use
of
cap
and
trade
in
general
will
limit
impacts
on
small
entities
relative
to
a
less
flexible
53
command­
and­
control
program.

D.
Unfunded
Mandates
Reform
Act
Title
II
of
the
Unfunded
Mandates
Reform
Act
of
1995
(
Public
Law
104­
4)(
UMRA),
establishes
requirements
for
Federal
agencies
to
assess
the
effects
of
their
regulatory
actions
on
State,
local,
and
Tribal
governments
and
the
private
sector.
Under
section
202
of
the
UMRA,
2
U.
S.
C.

1532,
EPA
generally
must
prepare
a
written
statement,

including
a
cost­
benefit
analysis,
for
any
proposed
or
final
rule
that
"
includes
any
Federal
mandate
that
may
result
in
the
expenditure
by
State,
local,
and
Tribal
governments,
in
the
aggregate,
or
by
the
private
sector,
of
$
100,000,000
or
more
.
.
.
in
any
one
year."
A
"
Federal
mandate"
is
defined
under
section
421(
6),
2
U.
S.
C.
658(
6),
to
include
a
"
Federal
intergovernmental
mandate"
and
a
"
Federal
private
sector
mandate."
A
"
Federal
intergovernmental
mandate,"
in
turn,

is
defined
to
include
a
regulation
that
"
would
impose
an
enforceable
duty
upon
State,
Local,
or
Tribal
governments,"

section
421(
5)(
A)(
i),
2
U.
S.
C.
658(
5)(
A)(
i),
except
for,

among
other
things,
a
duty
that
is
"
a
condition
of
Federal
assistance,"
section
421(
5)(
A)(
i)(
I).
A
"
Federal
private
sector
mandate"
includes
a
regulation
that
"
would
impose
an
enforceable
duty
upon
the
private
sector,"
with
certain
exceptions,
section
421(
7)(
A),
2
U.
S.
C.
658(
7)(
A).
54
Before
promulgating
an
EPA
rule
for
which
a
written
statement
is
needed
under
section
202
of
the
UMRA,
section
205,
2
U.
S.
C.
1535,
of
the
UMRA
generally
requires
EPA
to
identify
and
consider
a
reasonable
number
of
regulatory
alternatives
and
adopt
the
least
costly,
most
costeffective
or
least
burdensome
alternative
that
achieves
the
objectives
of
the
rule.

The
EPA
prepared
a
written
statement
for
the
CAIR
final
inclusive
of
this
rule
consistent
with
the
requirements
of
section
202
of
the
UMRA.
Furthermore,
as
EPA
stated
in
the
rule,
EPA
is
not
directly
establishing
any
regulatory
requirements
that
may
significantly
or
uniquely
affect
small
governments,
including
Tribal
governments.
Thus,
EPA
is
not
obligated
to
develop
under
section
203
of
the
UMRA
a
small
government
agency
plan.
Furthermore,
in
a
manner
consistent
with
the
intergovernmental
consultation
provisions
of
section
204
of
the
UMRA,
EPA
carried
out
consultations
with
the
governmental
entities
affected
by
this
rule.

For
several
reasons,
however,
EPA
is
not
reaching
a
final
conclusion
as
to
the
applicability
of
the
requirements
of
UMRA
to
this
rulemaking
action.
First,
it
is
questionable
whether
a
requirement
to
submit
a
SIP
revision
would
constitute
a
Federal
mandate
in
any
case.
The
obligation
for
a
State
to
revise
its
SIP
that
arises
out
of
55
section
110(
a)
of
the
CAA
is
not
legally
enforceable
by
a
court
of
law,
and
at
most
is
a
condition
for
continued
receipt
of
highway
funds.
Therefore,
it
is
possible
to
view
an
action
requiring
such
a
submittal
as
not
creating
any
enforceable
duty
within
the
meaning
of
section
421(
5)(
9a)(
I)

of
UMRA
(
2
U.
S.
C.
658
(
a)(
I)).
Even
if
it
did,
the
duty
could
be
viewed
as
falling
within
the
exception
for
a
condition
of
Federal
assistance
under
section
421(
5)(
a)(
i)(
I)
of
UMRA
(
2
U.
S.
C.
658(
5)(
a)(
i)(
I)).

As
noted
earlier,
however,
notwithstanding
these
issues,
EPA
prepared
the
statement
that
would
be
required
by
UMRA
if
its
statutory
provisions
applied
for
the
CAIR
final
rule
and
this
rule.
The
EPA
also
consulted
with
governmental
entities
as
would
be
required
by
UMRA.

Consequently,
it
is
not
necessary
for
EPA
to
reach
a
conclusion
as
to
the
applicability
of
the
UMRA
requirements.

The
EPA
conducted
an
analysis
of
the
economic
impacts
anticipated
from
the
CAIR
program
inclusive
of
the
New
Jersey
and
Delaware
proposal
for
government­
owned
entities.

The
modeling
conducted
using
the
IPM
projects
that
about
340
MW
of
municipality­
owned
capacity
(
about
0.4
percent
of
all
subdivision,
State
and
municipality
capacity
in
the
CAIR
region)
would
be
uneconomic
to
maintain
under
the
CAIR
program,
beyond
what
is
projected
in
the
base
case.
In
56
practice,
however,
the
units
projected
to
be
uneconomic
to
maintain
may
be
"
mothballed,"
retired,
or
kept
in
service
to
ensure
transmission
reliability
in
certain
parts
of
the
grid.
For
the
most
part,
these
units
are
small
and
infrequently
used
generating
units
that
are
dispersed
throughout
the
CAIR
region.

The
EPA
modeling
identified
265
State
or
municipallyowned
entities,
as
well
as
subdivisions,
within
the
entire
CAIR
region.
The
EPA
excluded
from
the
analysis
governmentowned
entities
that
were
not
projected
to
have
at
least
one
unit
with
generating
capacity
of
25
MW
or
greater
in
the
base
case.
Thus,
we
excluded
184
entities
from
the
analysis.
We
found
that
81
government
entities
will
be
potentially
affected
by
the
CAIR.
Of
the
81
government
entities,
20
may
experience
compliance
costs
in
excess
of
1
percent
of
revenues
in
2010,
and
39
may
in
2015,
based
on
our
assumptions
of
how
the
affected
States
implement
control
measures
to
meet
their
emissions
budgets
as
set
forth
in
this
rulemaking.

Government
entities
projected
to
experience
compliance
costs
in
excess
of
1
percent
of
revenues
have
some
potential
for
significant
impact
resulting
from
implementation
of
the
CAIR.
However,
as
noted
above,
it
is
EPA's
position
that
because
these
government
entities
can
pass
on
their
costs
of
57
compliance
to
rate­
payers,
they
will
not
be
significantly
impacted.
Furthermore,
the
decision
to
include
only
units
greater
than
25
MW
in
size
exempts
179
government
entities
that
would
otherwise
be
potentially
affected
by
the
CAIR
program.

The
above
points
aside,
potentially
adverse
impacts
of
the
CAIR
program
on
State
and
municipality­
owned
entities
could
be
limited
by
the
fact
that
the
cap
and
trade
program
is
designed
such
that
States
determine
how
NOx
allowances
are
to
be
allocated
across
units.
A
State
that
wishes
to
mitigate
the
impact
of
the
rule
on
State
or
municipalityowned
entities
might
choose
to
allocate
NOX
allowances
in
a
manner
that
is
favorable
to
these
entities.
Finally,
the
use
of
cap
and
trade
in
general
will
limit
impacts
on
entities
owned
by
small
governments
relative
to
a
less
flexible
command­
and­
control
program.

E.
Executive
Order
13132:
Federalism
Executive
Order
13132,
entitled
"
Federalism"
(
64
FR
43255,
August
10,
1999),
requires
EPA
to
develop
an
accountable
process
to
ensure
"
meaningful
and
timely
input
by
State
and
local
officials
in
the
development
of
regulatory
policies
that
have
federalism
implications."

"
Policies
that
have
federalism
implications"
is
defined
in
the
Executive
Order
to
include
regulations
that
have
58
"
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."

This
rule
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.
The
CAA
establishes
the
relationship
between
the
Federal
government
and
the
States,
and
this
rule
does
not
impact
that
relationship.
Thus,
Executive
Order
13132
does
not
apply
to
this
rule.
In
the
spirit
of
Executive
Order
13132,
and
consistent
with
EPA
policy
to
promote
communications
between
EPA
and
State
and
local
governments,
EPA
specifically
solicited
comment
on
the
CAIR
from
State
and
local
officials.

F.
Executive
Order
13175:
Consultation
and
Coordination
with
Indian
Tribal
Governments
Executive
Order
13175,
entitled
"
Consultation
and
Coordination
with
Indian
Tribal
Governments"
(
65
FR
67249,

November
9,
2000),
requires
EPA
to
develop
an
accountable
process
to
ensure
"
meaningful
and
timely
input
by
Tribal
officials
in
the
development
of
regulatory
policies
that
59
have
Tribal
implications."
The
CAIR
program
(
CAIR
final
and
New
Jersey
and
Delaware
rule)
does
not
have
Tribal
implications
as
specified
in
Executive
Order
13175.

The
CAIR
program
addresses
transport
of
pollutants
that
are
precursors
for
ozone
and
PM2.5.
The
CAA
provides
for
States
and
Tribes
to
develop
plans
to
regulate
emissions
of
air
pollutants
within
their
jurisdictions.
The
regulations
clarify
the
statutory
obligations
of
States
and
Tribes
that
develop
plans
to
implement
this
rule.
The
Tribal
Authority
Rule
(
TAR)
give
Tribes
the
opportunity
to
develop
and
implement
CAA
programs,
but
it
leaves
to
the
discretion
of
the
Tribe
whether
to
develop
these
programs
and
which
programs,
or
appropriate
elements
of
a
program,
the
Tribe
will
adopt.

The
CAIR
program
does
not
have
Tribal
implications
as
defined
by
Executive
Order
13175.
It
does
not
have
a
substantial
direct
effect
on
one
or
more
Indian
Tribes,

because
no
Tribe
has
implemented
a
federally
enforceable
air
quality
management
program
under
the
CAA
at
this
time.

Furthermore,
the
CAIR
program
does
not
affect
the
relationship
or
distribution
of
power
and
responsibilities
between
the
Federal
government
and
Indian
Tribes.
The
CAA
and
the
TAR
establish
the
relationship
of
the
Federal
government
and
Tribes
in
developing
plans
to
attain
the
60
NAAQS,
and
this
rule
does
nothing
to
modify
that
relationship.
Because
the
CAIR
program
does
not
have
Tribal
implications,
Executive
Order
13175
does
not
apply.

If
one
assumes
a
Tribe
is
implementing
a
Tribal
Implementation
Plan,
today's
rule
could
have
implications
for
that
Tribe,
but
it
would
not
impose
substantial
direct
costs
upon
the
Tribe,
nor
preempt
Tribal
law.
As
provided
above,
EPA
has
estimated
that
the
total
annual
private
costs
for
the
CAIR
program
inclusive
of
the
New
Jersey
and
Delaware
rule
for
the
CAIR
region
as
implemented
by
State,

local,
and
Tribal
governments
is
approximately
$
2.4
billion
in
2010
and
$
3.6
billion
in
2015
(
1999
dollars).
There
are
currently
very
few
emissions
sources
in
Indian
country
that
could
be
affected
by
the
CAIR
program
and
the
percentage
of
Tribal
land
that
will
be
impacted
is
very
small.
For
Tribes
that
choose
to
regulate
sources
in
Indian
country,
the
costs
would
be
attributed
to
inspecting
regulated
facilities
and
enforcing
adopted
regulations.

Although
Executive
Order
13175
does
not
apply
to
this
rule,
EPA
consulted
with
Tribal
officials
in
developing
the
CAIR
program.
The
EPA
encouraged
Tribal
input
at
an
early
stage.
Also,
EPA
held
periodic
meetings
with
the
States
and
the
Tribes
during
the
technical
development
of
the
CAIR
program.
Three
meetings
were
held
with
the
Crow
Tribe,
61
where
the
Tribe
expressed
concerns
about
potential
impacts
of
the
CAIR
on
their
coal
mine
operations.
The
addition
of
Delaware
and
New
Jersey
to
the
CAIR
program
does
not
have
any
bearing
upon
the
concerns
expressed
by
the
Tribes.
In
addition,
EPA
held
three
calls
with
Tribal
environmental
professionals
to
address
concerns
specific
to
the
Tribes.

These
discussions
have
given
EPA
valuable
information
about
Tribal
concerns
regarding
the
development
of
the
CAIR
program.
The
EPA
has
provided
briefings
for
Tribal
representatives
and
the
newly
formed
National
Tribal
Air
Association
(
NTAA),
and
other
national
Tribal
forums.
Input
from
Tribal
representatives
was
taken
into
consideration
in
development
of
the
CAIR
program.

G.
Executive
Order
13045:
Protection
of
Children
from
Environmental
Health
and
Safety
Risks
Executive
Order
13045,
"
Protection
of
Children
from
Environmental
Health
and
Safety
Risks"
(
62
FR
19885,
April
23,
1997)
applies
to
any
rule
that
(
1)
is
determined
to
be
"
economically
significant"
as
defined
under
Executive
Order
12866,
and
(
2)
concerns
an
environmental
health
or
safety
risk
that
EPA
has
reason
to
believe
may
have
a
disproportionate
effect
on
children.
If
the
regulatory
action
meets
both
criteria,
Section
5 
501
of
the
Order
directs
the
Agency
to
evaluate
the
environmental
health
or
62
safety
effects
of
the
planned
rule
on
children,
and
explain
why
the
planned
regulation
is
preferable
to
other
potentially
effective
and
reasonably
feasible
alternatives
considered
by
the
Agency.

The
CAIR
program
inclusive
of
the
Delaware
and
New
Jersey
rule
is
not
subject
to
the
Executive
Order,
because
it
does
not
involve
decisions
on
environmental
health
or
safety
risks
that
may
disproportionately
affect
children.

The
EPA
believes
that
the
emissions
reductions
from
the
strategies
in
this
rule
will
further
improve
air
quality
and
will
further
improve
children's
health.

H.
Executive
Order
13211:
Actions
That
Significantly
Affect
Energy
Supply,
Distribution,
or
Use
Executive
Order
13211
(
66
FR
28355,
May
22,
2001)

provides
that
agencies
shall
prepare
and
submit
to
the
Administrator
of
the
Office
of
Regulatory
Affairs,
OMB,
a
Statement
of
Energy
Effects
for
certain
actions
identified
as
"
significant
energy
actions."
Section
4(
b)
of
Executive
Order
13211
defines
"
significant
energy
actions"
as
any
action
by
an
agency
(
normally
published
in
the
Federal
Register)
that
promulgates
or
is
expected
to
lead
to
the
promulgation
of
a
final
rule
or
regulation,
including
notices
of
inquiry,
advance
notices
of
final
rulemaking,
and
notices
of
final
rulemaking:
(
1)
(
i)
that
is
a
significant
63
regulatory
action
under
Executive
Order
12866
or
any
successor
order,
and
(
ii)
is
likely
to
have
a
significant
adverse
effect
on
the
supply,
distribution,
or
use
of
energy;
or
(
2)
that
is
designated
by
the
Administrator
of
the
Office
of
Information
and
Regulatory
Affairs
as
a
"
significant
energy
action."
The
CAIR
program
(
the
CAIR
final
and
the
New
Jersey
and
Delaware
rule)
is
a
significant
regulatory
action
under
Executive
Order
12866,
and
the
CAIR
program
may
have
a
significant
adverse
effect
on
the
supply,

distribution,
or
use
of
energy.

If
States
choose
to
obtain
the
emissions
reductions
required
by
the
CAIR
final
and
this
rule
by
regulating
EGUs,

EPA
projects
that
approximately
5.3
GW
of
coal­
fired
generation
(
0.5
GW
due
to
the
inclusion
of
Delaware
and
New
Jersey)
may
be
removed
from
operation
by
2010.
In
practice,

however,
the
units
projected
to
be
uneconomic
to
maintain
may
be
"
mothballed,"
retired,
or
kept
in
service
to
ensure
transmission
reliability
in
certain
parts
of
the
grid.
For
the
most
part,
these
units
are
small
and
infrequently
used
generating
units
that
are
dispersed
throughout
the
CAIR
region.
Less
conservative
assumptions
regarding
natural
gas
prices
or
electricity
demand
would
create
a
greater
incentive
to
keep
these
units
operational.
The
EPA
projects
that
the
average
annual
electricity
price
will
increase
by
64
less
than
2.7
percent
in
the
CAIR
region
(
and
less
than
3.5
percent
in
the
MAAC
Power
Region,
which
includes
Delaware
and
New
Jersey)
for
the
CAIR
program.
The
EPA
does
not
believe
that
the
CAIR
final
and
this
rule
will
have
any
other
impacts
that
exceed
the
significance
criteria.

The
EPA
believes
that
a
number
of
features
of
today's
rulemaking
serve
to
reduce
its
impact
on
energy
supply.

First,
the
optional
trading
program
provides
considerable
flexibility
to
the
power
sector
and
enables
industry
to
comply
with
the
emission
reduction
requirements
in
the
most
cost­
effective
manner,
thus
minimizing
overall
costs
and
the
ultimate
impact
on
energy
supply.
The
ability
to
use
banked
allowances
from
the
existing
title
IV
SO2
Trading
Program
and
the
NOx
SIP
Call
Trading
Program
also
provide
additional
flexibility.
Second,
the
CAIR
program
caps
are
set
in
two
phases
and
provide
adequate
time
for
EGUs
to
install
pollution
controls.
For
more
details
concerning
energy
impacts,
see
the
Regulatory
Impact
Analysis
for
the
Final
Clean
Air
Interstate
Rule
(
March
2005).

I.
National
Technology
Transfer
Advancement
Act
Section
12(
d)
of
the
National
Technology
Transfer
Advancement
Act
(
NTTAA)
of
1995
(
Public
Law
No.
104­
113;
15
U.
S.
C.
272
note)
directs
EPA
to
use
voluntary
consensus
standards
in
its
regulatory
and
procurement
activities
65
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,
business
practices)
developed
or
adopted
by
one
or
more
voluntary
consensus
bodies.
The
NTTAA
directs
EPA
to
provide
Congress,
through
annual
reports
to
OMB,
with
explanations
when
an
agency
does
not
use
available
and
applicable
voluntary
consensus
standards.

The
CAIR
final
and
this
rule
would
require
all
sources
that
participate
in
the
trading
program
under
part
96
to
meet
the
applicable
monitoring
requirements
of
part
75.

Part
75
already
incorporates
a
number
of
voluntary
consensus
standards.
Consistent
with
the
Agency's
Performance
Based
Measurement
System
(
PBMS),
part
75
sets
forth
performance
criteria
that
allow
the
use
of
alternative
methods
to
the
ones
set
forth
in
part
75.
The
PBMS
approach
is
intended
to
be
more
flexible
and
cost
effective
for
the
regulated
community;
it
is
also
intended
to
encourage
innovation
in
analytical
technology
and
improved
data
quality.
At
this
time,
EPA
is
not
recommending
any
revisions
to
part
75;

however,
EPA
periodically
revises
the
test
procedures
set
forth
in
part
75.
When
EPA
revises
the
test
procedures
set
forth
in
part
75
in
the
future,
EPA
will
address
the
use
of
any
new
voluntary
consensus
standards
that
are
equivalent.
66
Currently,
even
if
a
test
procedure
is
not
set
forth
in
part
75,
EPA
is
not
precluding
the
use
of
any
method,
whether
it
constitutes
a
voluntary
consensus
standard
or
not,
as
long
as
it
meets
the
performance
criteria
specified;
however,
any
alternative
methods
must
be
approved
through
the
petition
process
under
section
75.66
before
they
are
used
under
part
75.

J.
Executive
Order
12898:
Federal
Actions
to
Address
Environmental
Justice
in
Minority
Populations
and
Low­
Income
Populations
Executive
Order
12898,
"
Federal
Actions
to
Address
Environmental
Justice
in
Minority
Populations
and
Low­
Income
Populations,"
requires
Federal
agencies
to
consider
the
impact
of
programs,
policies,
and
activities
on
minority
populations
and
low­
income
populations.
According
to
EPA
guidance,
11
agencies
are
to
assess
whether
minority
or
lowincome
populations
face
risks
or
a
rate
of
exposure
to
hazards
that
are
significant
and
that
"
appreciably
exceed
or
is
likely
to
appreciably
exceed
the
risk
or
rate
to
the
general
population
or
to
the
appropriate
comparison
group."

(
EPA,
1998)

11
U.
S.
Environmental
Protection
Agency,
1998.
Guidance
for
Incorporating
Environmental
Justice
Concerns
in
EPA's
NEPA
Compliance
Analyses.
Office
of
Federal
Activities,
Washington,
D.
C.,
April,
1998.
67
In
accordance
with
Executive
Order
12898,
the
Agency
has
considered
whether
the
CAIR
program
inclusive
of
the
New
Jersey
and
Delaware
rule
may
have
disproportionate
negative
impacts
on
minority
or
low
income
populations.
The
Agency
expects
the
CAIR
program
to
lead
to
reductions
in
air
pollution
and
exposures
generally.
For
this
reason,

negative
impacts
to
these
sub­
populations
that
appreciably
exceed
similar
impacts
to
the
general
population
are
not
expected.

K.
Congressional
Review
Act
The
Congressional
Review
Act,
5
U.
S.
C.
801
et
seq.,
as
added
by
the
Small
Business
Regulatory
Enforcement
Fairness
Act
of
1996,
generally
provides
that
before
a
rule
may
take
effect,
the
agency
promulgating
the
rule
must
submit
a
rule
report,
which
includes
a
copy
of
the
rule,
to
each
House
of
the
Congress
and
to
the
Comptroller
General
of
the
United
States.
The
EPA
will
submit
a
report
containing
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
a
"
major
rule"
as
defined
by
5
U.
S.
C.
804(
2).

This
rule
will
be
effective
[
Insert
60
days
from
date
of
68
publication].
69
List
of
Subjects
40
CFR
Part
51
Administrative
practice
and
procedure,
Air
pollution
control,
Intergovernmental
relations,
Nitrogen
dioxide,

Ozone,
Particulate
matter,
Reporting
and
recordkeeping
requirements,
Sulfur
oxides,
Volatile
organic
compounds.

40
CFR
Part
96
Administrative
practice
and
procedure,
Air
pollution
control,
Nitrogen
oxides,
Reporting
and
recordkeeping
requirements
________________________

Dated:

________________________
Stephen
L.
Johnson
Administrator
70
Title
40,
Chapter
I,
of
the
Code
of
Federal
Regulations
is
amended
as
follows:

PART
51 [
AMENDED]

1.
The
authority
citation
for
part
51
continues
to
read
as
follows:

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

Subpart
G­­[
Amended]

2.
Section
51.123
is
amended
as
follows:

a.
By
revising
paragraphs
(
c)(
1)
and
(
c)(
2)

b.
In
the
table
to
paragraph
(
e)(
2)
by
adding
entries
for
"
Delaware"
and
"
New
Jersey"
in
alphabetical
order.

c.
In
the
table
to
paragraph
(
e)(
4)(
ii)
by
adding
entries
for
"
Delaware"
and
"
New
Jersey"
in
alphabetical
order.

§
51.123
Findings
and
requirements
for
submission
of
State
implementation
plan
revisions
relating
to
emissions
of
oxides
of
nitrogen
pursuant
to
the
Clean
Air
Interstate
Rule.

*
*
*
*
*

(
c)
*
*
*

(
1)
Alabama,
Delaware,
Florida,
Illinois,
Indiana,

Iowa,
Kentucky,
Louisiana,
Maryland,
Michigan,
Mississippi,

Missouri,
New
Jersey,
New
York,
North
Carolina,
Ohio,

Pennsylvania,
South
Carolina,
Tennessee,
Virginia,
West
71
Virginia,
Wisconsin,
and
the
District
of
Columbia
shall
be
subject
to
the
requirements
contained
in
paragraphs
(
e)

through
(
cc)
of
this
section;

*
*
*
*
*

(
3)
Arkansas,
Connecticut,
and
Massachusetts
shall
be
subject
to
the
requirements
contained
in
paragraphs
(
q)

through
(
cc)
of
this
section.

*
*
*
*
*

(
e)
*
*
*

(
2)
*
*
*

State
Annual
EGU
NOX
budget
for
2009­
2014
(
tons)
Annual
EGU
NOX
budget
for
2015
and
thereafter
(
tons)
*
*
*
Delaware
.
.
.
.
.
.
.
.
.
.
.
*
*
*
New
Jersey
.
.
.
.
.
.
.
.
.
.
*
*
*
*
*
*
4,166
*
*
*
12,670
*
*
*
*
3,472
*
10,558
*

*
*
*
*
*

(
4)(
i)
*
*
*

(
ii)
*
*
*

State
Compliance
supplement
pool
72
*
*
*
*
Delaware
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
*
*
*
*
New
Jersey
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
*
*
*
*
*
*
*
843
*
*
*
660
*
*
*

*
*
*
*
*

§
51.124
[
Amended]

3.
Section
51.124
is
amended
by
revising
paragraphs
(
c)
and
(
e)(
2)
to
read
as
follows:

§
51.124
Findings
and
requirements
for
submission
of
State
implementation
plan
revisions
relating
to
emissions
of
sulfur
dioxide
pursuant
to
the
Clean
Air
Interstate
Rule.

(
a)
*
*
*

*
*
*
*
*

(
c)
The
following
States
are
subject
to
the
requirements
of
this
section:
Alabama,
Delaware,
Florida,

Georgia,
Illinois,
Indiana,
Iowa,
Kentucky,
Louisiana,

Maryland,
Michigan,
Minnesota,
Mississippi,
Missouri,
New
Jersey,
New
York,
North
Carolina,
Ohio,
Pennsylvania,
South
Carolina,
Tennessee,
Texas,
Virginia,
West
Virginia,

Wisconsin,
and
the
District
of
Columbia.

*
*
*
*
*

(
e)
*
*
*

(
2)
*
*
*
73
State
Annual
EGU
SO2
budget
for
2010­
2014
(
tons)
Annual
EGU
SO2
budget
for
2015
and
thereafter
(
tons)
*
*
*
Delaware
.
.
.
.
.
.
.
.
.
.
*
*
*
New
Jersey
.
.
.
.
.
.
.
.
.
*
*
*
*
*
*
22,411
*
*
*
32,392
*
*
*
*
15,687
*
22,674
*

*
*
*
*
*

4.
Section
51.125
is
amended
by
revising
paragraph
(
a)(
1)
to
read
as
follows:

§
51.125
Emissions
reporting
requirements
for
SIP
revisions
relating
to
budgets
for
SO2
and
NOX
emissions.

(
a)
*
*
*

(
1)
Alabama,
Delaware,
Florida,
Georgia,
Illinois,

Indiana,
Iowa,
Kentucky,
Louisiana,
Maryland,
Michigan,

Minnesota,
Mississippi,
Missouri,
New
Jersey,
New
York,

North
Carolina,
Ohio,
Pennsylvania,
South
Carolina,

Tennessee,
Texas,
Virginia,
West
Virginia,
Wisconsin,
and
the
District
of
Columbia.

*
*
*
*
*

PART
96 [
AMENDED]

5.
The
authority
citation
for
part
96
continues
to
read
as
follows:

/
Authority:
42
U.
S.
C.
7401,
7403,
7410,
7601,
and
7651,

et
seq.
74
SUBPART
EE [
AMENDED]

6.
In
96.140
the
table
is
amended
by
adding
entries
for
"
Delaware"
and
"
New
Jersey"
in
alphabetical
order
to
read
as
follows:

§
96.140
State
trading
budgets.

*
*
*
*
*

State
State
trading
budget
for
2009­
2014
(
tons)
State
trading
budget
for
2015
and
thereafter
(
tons)
*
*
*
Delaware
.
.
.
.
.
.
.
.
.
.
*
*
*
New
Jersey
.
.
.
.
.
.
.
.
.
*
*
*
*
*
*
4,166
*
*
*
12,670
*
*
*
*
3,472
*
10,558
*

7.
In
§
96.143
the
table
is
amended,
in
paragraph
(
a),
by
adding
entries
for
"
Delaware"
and
"
New
Jersey"
in
alphabetical
order
to
read
as
follows:

§
96.143
Compliance
supplement
pool.

(
a)
*
*
*

State
Compliance
supplement
pool
(
tons)

*
*
*
*
Delaware
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
*
*
*
*
New
Jersey
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
*
*
*
*
*
*
*
843
*
*
*
660
*
*
*

*
*
*
*
*
