ENVIRONMENTAL
PROTECTION
AGENCY
40
CFR
Parts
51
and
52
[
OAR­
2004­
0079;
FRL­
]

[
RIN
]

Nonattainment
New
Source
Review
(
NSR)

AGENCY:
Environmental
Protection
Agency
(
EPA).

ACTION:
Final
Rule.

SUMMARY:
The
EPA
is
finalizing
revisions
to
the
regulations
governing
the
nonattainment
new
source
review
(
NSR)
programs
mandated
by
section
110(
a)(
2)(
C)
and
part
D
of
title
I
of
the
Clean
Air
Act
(
CAA).
These
changes
codify
requirements
of
part
D
of
title
I
of
the
1990
amendments
related
to
permitting
of
major
stationary
sources
of
ozone
precursors
in
ozone
nonattainment
areas.
These
revisions
include
changes
to
the
regulations
for
permitting
of
major
stationary
sources
in
nonattainment
areas
in
interim
periods
between
designation
of
new
nonattainment
areas
and
adoption
of
a
revised
State
Implementation
Plan
(
SIP).
They
also
include
changes
to
the
regulations
that
impose
a
moratorium
(
ban)
prohibiting
construction
of
new
or
modified
major
stationary
sources
in
nonattainment
areas
where
the
State
fails
to
have
an
implementation
plan
meeting
all
of
the
requirements
of
part
D.
Today's
changes
are
based
on
the
proposed
rule
published
June
2,
2003
to
Implement
the
8­
Hour
Ozone
National
Ambient
Air
Quality
Standard
(
NAAQS),
as
well
as
the
proposed
rule
published
July
23,
1996
for
"
Prevention
2
of
Significant
Deterioration
(
PSD)
and
Non­
attainment
New
Source
Review
(
NSR)".
The
revisions
codify
the
permitting
requirements
of
section
110(
a)(
2)(
C)
and
part
D
of
title
I
that
are
necessary
to
implement
the
8­
Hour
ozone
NAAQS.

These
revisions
also
conform
the
nonattainment
permitting
rules
that
apply
during
the
SIP
development
period
following
nonattainment
designations
before
SIP
approval
with
the
federal
permitting
rules
applicable
to
SIP­
approved
programs.
The
changes
also
update
the
permitting
rules
that
apply
when
the
Administrator
determines
that
the
SIP
for
meeting
the
part
D
requirements
is
not
being
implemented
adequately.
The
changes
are
intended
to
provide
a
consistent
national
program
for
permitting
major
stationary
sources
in
nonattainment
areas
under
section
110(
a)(
2)(
C)

and
part
D
of
title
I,
including
major
stationary
sources
of
ozone
precursors
in
ozone
nonattainment
areas.

EFFECTIVE
DATE:
This
final
rule
is
effective
on
June
15,

2004.

ADDRESSES:
Docket.
EPA
has
established
a
docket
for
this
action
under
Docket
ID
No.
OAR­
2004­
0079.
All
documents
in
the
docket
are
listed
in
the
EDOCKET
index
at
http://
www.
epa.
gov/
edocket.
Although
listed
in
the
index,

some
information
is
not
publicly
available,
i.
e.,
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
3
in
hard
copy
form.
Publicly
available
docket
materials
are
available
either
electronically
in
EDOCKET
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,
and
the
telephone
number
for
the
Air
Docket
is
(
202)
566­
1742.

Worldwide
Web
(
WWW).
In
addition
to
being
available
in
the
docket,
an
electronic
copy
of
this
final
rule
will
also
be
available
on
the
WWW
through
the
Technology
Transfer
Network
(
TTN).
Following
signature,
a
copy
of
the
rule
will
be
posted
on
the
TTN's
policy
and
guidance
page
for
newly
proposed
or
promulgated
rules:
http://
www.
epa.
gov/
ttn/
oarpg.

FOR
FURTHER
INFORMATION
CONTACT:
Ms.
Janet
McDonald,

Information
Transfer
and
Program
Integration
Division
(
C339­

03),
U.
S.
EPA
Office
of
Air
Quality
Planning
and
Standards,

Research
Triangle
Park,
North
Carolina
27711,
telephone
919­

541­
1450,
or
electronic
mail
at
mcdonald.
janet@
epa.
gov.

SUPPLEMENTARY
INFORMATION:

I.
General
Information
A.
What
are
the
regulated
entities?

Entities
potentially
affected
by
this
final
action
include
sources
in
all
industry
groups.
The
majority
of
sources
potentially
affected
are
expected
to
be
in
the
following
groups:
4
Industry
Group
SICa
NAICSb
Electric
Services
491
221111,
221112,
221113,

221119,
221121,
221122
Petroleum
Refining
291
324110
Industrial
Inorganic
Chemicals
281
325181,
325120,
325131,

325182,
211112,
325998,

331311,
325188
Industrial
Organic
Chemicals
286
325110,
325132,
325192,

325188,
325193,
325120,

325199
Miscellaneous
Chemical
Products
289
325520,
325920,
325910,

325182,
325510
Natural
Gas
Liquids
132
211112
Natural
Gas
Transport
492
486210,
221210
Pulp
and
Paper
Mills
261
322110,
322121,
322122,

322130
Paper
Mills
262
322121,
322122
Automobile
Manufacturing
371
336111,
336112,
336211,

336992,
336322,
336312,

336330,
336340,
336350,

336399,
336212,
336213
Pharmaceuticals
283
325411,
325412,
325413,

325414
a
Standard
Industrial
Classification
b
North
American
Industry
Classification
System.

Entities
potentially
affected
by
this
final
action
also
include
State,
local,
and
tribal
governments
that
are
delegated
authority
to
implement
these
regulations.

B.
How
is
this
preamble
organized?

The
information
presented
in
this
preamble
is
organized
5
as
follows:

I.
General
Information
A.
What
are
the
regulated
entities?
B.
How
is
this
preamble
organized?
II.
Overview
of
Today's
Final
Action
III.
Background
A.
The
Major
NSR
Program
B.
What
We
Proposed
1.
Proposed
Changes
to
§
51.165
2.
Proposed
Changes
to
§
52.24
3.
Proposed
Changes
to
Appendix
S
IV.
Description
of
Today's
Final
Action
and
Legal
Basis
A.
Final
Action
and
Legal
Basis
for
Changes
to
§
51.165
1.
Final
Changes
to
§
51.165
2.
Legal
Basis
for
§
51.165
B.
Final
Action
and
Legal
Basis
for
Changes
to
§
52.24
1.
Final
Changes
to
§
52.24
2.
Legal
Basis
for
§
52.24
C.
Final
Action
and
Legal
Basis
for
Changes
to
Appendix
S
1.
Final
Changes
to
appendix
S
2.
Legal
Basis
for
appendix
S
V.
Summary
of
Major
Comments
and
Responses
A.
Comments
on
§
51.165
B.
Comments
on
§
52.24
C.
Comments
on
Appendix
S
1.
Changes
to
Incorporate
1990
Amendments
2.
Changes
to
Conform
to
Major
NSR
Program
3.
Changes
to
Section
VI
4.
Notice
and
Comment
VI.
NSR
Implementation
A.
Areas
That
Have
Never
Been
Nonattainment
for
Ozone
B.
Areas
That
Are
Nonattainment
for
the
1­
hour
NAAQS
and
the
8­
hour
NAAQS
C.
Part
D
NSR
SIP
Submittals
VII.
Effective
Date
for
Today's
Requirements
VIII.
Statutory
and
Executive
Order
Reviews
A.
Executive
Order
12866
­
Regulatory
Planning
and
Review
B.
Paperwork
Reduction
Act
C.
Regulatory
Flexibility
Analysis
D.
Unfunded
Mandates
Reform
Act
of
1995
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
Risks
and
Safety
Risks
H.
Executive
Order
13211
­
Actions
Concerning
Regulations
That
Significantly
Affect
Energy
6
Supply,
Distribution,
or
Use
I.
National
Technology
Transfer
and
Advancement
Act
of
1995
J.
Congressional
Review
Act
IX.
Judicial
Review
X.
Statutory
Authority
II.
Overview
of
Today's
Final
Action
On
June
15,
2004,
the
nonattainment
designations
for
the
8­
hour
ozone
NAAQS
will
become
effective,
and
newly
designated
nonattainment
areas
will
need
to
begin
implementation
of
NSR
permitting
consistent
with
federal
regulations.
Thus,
in
today's
action,
we
are
finalizing
previously
proposed
changes
to
the
three
regulations
that
govern
NSR
permitting
of
major
stationary
sources
in
nonattainment
areas­
40
CFR
51.165,
appendix
S
of
40
CFR
part
51,
and
40
CFR
52.24.
In
§
51.165
and
appendix
S,
we
are
making
revisions
to
incorporate
the
major
stationary
source
thresholds,
significant
emission
rates,
and
offset
ratios
pursuant
to
part
D
of
title
I
of
the
1990
amendments
to
the
CAA.
These
changes
are
necessary
to
implement
the
requirements
of
the
1990
amendments
for
major
stationary
sources
in
nonattainment
areas,
including
areas
that
are
nonattainment
for
the
8­
hour
ozone
NAAQS.
We
are
not
currently
finalizing
other
proposed
changes
to
40
CFR
51.165.

Appendix
S
of
40
CFR
part
51
contains
the
permitting
program
for
major
stationary
sources
in
nonattainment
areas
in
transition
periods
before
EPA
approves
a
SIP
to
implement
7
the
NSR
requirements
in
part
D
of
title
I.
In
addition
to
making
the
same
changes
we
are
making
to
§
51.165
to
implement
the
1990
Amendments,
today's
final
rules
revise
appendix
S
to
conform
it
to
the
changes
made
to
regulations
at
40
CFR
51.165
for
SIP
programs
for
nonattainment
major
NSR.
(
67
FR
80816;
December
31,
2002)
The
final
rule
also
includes
a
revision
to
Section
VI
of
Appendix
S
resulting
from
the
proposed
revisions
to
Section
VI
in
the
8­
hour
NAAQS
implementation
proposal
(
68
FR
32802).

The
regulations
at
40
CFR
52.24
contain
restrictions
on
the
construction
or
modification
of
major
stationary
sources,
including
a
construction
ban
applicable
in
circumstances
enumerated
by
the
Act.
These
regulations
also
apply
if
the
Administrator
determines
pursuant
to
CAA
section
173(
a)(
4)
that
the
SIP
for
meeting
the
part
D
requirements
is
not
being
adequately
implemented
for
a
nonattainment
area.
Today's
final
rules
codify
requirements
of
the
1990
amendments
altering
the
applicability
of
the
construction
ban.
The
final
rules
at
§
52.24
also
codify
that
§
51.165
applies
in
interpreting
the
terms
in
§
52.24.

The
regulations
at
40
CFR
52.24(
k)
retain
the
requirement
that
appendix
S
governs
permits
to
construct
and
operate
applied
for
during
the
period
between
the
date
of
designation
as
nonattainment
and
the
date
the
part
D
plan
for
NSR
is
approved,
but
is
updated
to
remove
the
reference
to
the
construction
ban.
1
For
a
more
complete
discussion
of
this
decision
and
its
implications,
see
69
FR
23956.

8
III.
Background
A.
The
Major
NSR
Program
The
major
NSR
program
contained
in
parts
C
and
D
of
title
I
of
the
Act
is
a
preconstruction
review
and
permitting
program
applicable
to
new
and
modified
major
stationary
sources
of
air
pollutants
regulated
under
the
Act.
In
areas
not
meeting
health­
based
NAAQS
and
in
ozone
transport
regions
(
OTR),
the
program
is
implemented
under
the
requirements
of
section
110(
a)(
2)(
C)
and
part
D
of
title
I
of
the
Act.
We
call
this
program
the
"
nonattainment"
NSR
program.
Subpart
1
of
part
D
of
title
I
contains
general
requirements
for
nonattainment
areas
for
any
criteria
pollutant
and
subpart
2
contains
provisions
specifically
for
ozone
nonattainment
areas.
In
Whitman
v.
American
Trucking
Associations,
[
531
U.
S.
457,
482­
86
(
2001)],
the
Supreme
Court
reviewed
EPA's
implementation
strategy
for
the
revised
8­
hour
ozone
NAAQS,
and
remanded
it
to
EPA
to
develop
a
reasonable
resolution
of
the
roles
of
subparts
1
and
2
in
classifying
areas
for
and
implementing
the
revised
ozone
standard.
1
In
areas
meeting
the
NAAQS
("
attainment"
areas)
or
for
which
there
is
insufficient
information
to
determine
whether
they
meet
the
NAAQS
("
unclassifiable"
areas),
the
NSR
2
In
some
cases,
subpart
1
and
subpart
2
requirements
are
inconsistent
or
overlap.
To
the
extent
that
subpart
2
addresses
a
specific
obligation,
the
provisions
in
subpart
2
control.
68
FR
32811.

9
requirements
under
part
C
of
title
I
of
the
Act
apply.
This
program
is
called
the
Prevention
of
Significant
Deterioration
(
PSD)
program.
Collectively,
we
also
commonly
refer
to
the
attainment
and
nonattainment
programs
as
the
major
NSR
program.
These
regulations
are
contained
in
40
CFR
51.165,
51.166,
52.21,
52.24,
and
part
51,
appendix
S.
Of
these,
the
nonattainment
area
regulations
are
contained
in
40
CFR
51.165,
52.24,
and
part
51,

appendix
S.

The
NSR
provisions
of
the
Act
are
implemented
primarily
through
State
preconstruction
permitting
programs.
As
provided
in
section
172(
c)(
4)
of
the
Act,
the
SIP
must
require
permits
for
the
construction
and
operation
of
new
or
modified
major
stationary
sources
in
accordance
with
section
173
of
the
Act.
Subpart
2
of
title
I
of
the
Act
sets
forth
additional
SIP
requirements
for
ozone
nonattainment
areas,

including
preconstruction
permitting
requirements.
2
The
permitting
requirements
for
SIPs
for
major
stationary
sources
locating
in
nonattainment
areas
are
found
in
40
CFR
51.165.
In
some
States,
the
SIP­
approved
program
under
§
51.165
contains
a
generic
requirement
to
issue
part
D
major
source
NSR
permits
in
areas
designated
as
nonattainment.
In
these
States,
nonattainment
NSR
permit
10
requirements
become
effective
automatically
in
newly
designated
nonattainment
areas.
For
a
nonattainment
area
in
a
State
with
a
SIP
that
specifically
lists
the
areas
in
which
part
D
NSR
applies,
or
in
areas
that
currently
have
no
nonattainment
plan,
there
is
an
interim
period
between
the
designation
date
and
the
date
that
EPA
approves
an
NSR
SIP
either
to
list
any
new
nonattainment
areas
or
to
include
a
part
D
plan.
40
CFR
52.24(
k)
specifies
that
appendix
S
governs
permits
to
construct
and
operate
applied
for
during
the
period
between
the
date
of
designation
as
nonattainment
and
the
date
we
approve
the
part
D
plan.
Appendix
S
states
that
it
is
an
interpretation
of
40
CFR
subpart
I
(
including
§
51.165),
and
has
historically
reflected
substantially
the
same
requirements
as
the
part
D
NSR
requirements.
This
includes
the
requirement
to
comply
with
the
lowest
achievable
emission
rate
(
LAER)
and
obtain
offsetting
emission
reductions,
with
a
limited
exemption
in
Section
VI
of
the
appendix
that
applies
to
sources
who
will
not
interfere
with
an
area's
attainment
deadline
and
meet
applicable
SIP
emissions
limitations.
Pursuant
to
§
52.24(
k),
where
necessary,
appendix
S
will
govern
NSR
permitting
for
major
stationary
sources
of
ozone
precursors
in
8­
hour
ozone
nonattainment
areas
during
the
SIP
development
period.
Thus,
consistent
with
section
110(
a)(
2)(
C),
permitting
of
new
and
modified
stationary
sources
in
the
area
will
be
regulated
as
necessary
to
ensure
11
that
the
national
ambient
air
quality
standards
are
achieved.

As
we
describe
further
in
Section
III.
B.
of
this
preamble,
today's
final
regulations
were
proposed
as
part
of
two
different
regulatory
packages.
On
July
23,
1996
(
61
FR
38250),
we
proposed
changes
to
the
major
NSR
program.
On
December
31,
2002,
we
finalized
five
actions
from
that
proposal.
For
a
summary
of
the
regulatory
development
process
and
stakeholder
development
for
that
rulemaking,
see
67
FR
80188.
On
June
2,
2003
(
68
FR
32802),
we
proposed
a
rule
to
implement
the
8­
hour
ozone
NAAQS.
On
April
30,

2004,
we
promulgated
the
final
rule
and
you
will
find
a
summary
of
the
regulatory
development
process
and
stakeholder
development
for
that
rulemaking
at
69
FR
23951.

B.
What
We
Proposed
1.
Proposed
Changes
to
§
51.165
On
July
23,
1996
(
61
FR
38250),
we
proposed
changes
to
§
51.165
to
incorporate
requirements
in
part
D
of
title
I
of
the
1990
amendments
to
the
CAA
for
ozone,
carbon
monoxide,

and
PM­
10
nonattainment
areas.
Specifically,
we
proposed
the
following
changes.

°
new
major
stationary
source
thresholds
°
new
significant
emission
rates
°
new
offset
ratios
°
NSR
requirements
applicable
to
major
stationary
sources
of
volatile
organic
compounds
(
including
provisions
3
John
S.
Seitz,
"
New
Source
Review
(
NSR)
Program
Transitional
Guidance,"
March
11,
1991.
We
provided
additional
transitional
guidance
for
nonattainment
areas
requesting
in
our
September
3,
1992
memorandum,
New
Source
Review
(
NSR)
program
Supplemental
Transitional
Guidance
on
Applicability
of
New
Part
D
NSR
Permit
Requirements,
from
John
Seitz,
Director,
Office
of
Air
Quality
Planning
and
Standards.

12
regarding
major
modifications,
significant
emission
rates,
and
offsets),
apply
to
nitrogen
oxide
emissions,

except
where
the
Administrator
determines
according
to
CAA
section
182(
f)
that
net
air
quality
benefits
are
greater
in
the
absence
of
reductions
of
nitrogen
oxide
emission
reductions
°
special
modification
provisions
implementing
CAA
sections
182(
c),
(
d),
and
(
e)
for
serious,
severe,
and
extreme
ozone
nonattainment
areas
°
changes
to
the
requirements
for
emission
credits
from
source
shutdowns
and
curtailments
Consistent
with
our
1991
Transition
Policy
Memo3,
we
proposed
that
the
major
stationary
source
thresholds
and
offset
ratios
of
CAA
section
182
(
subpart
2
of
part
D)
would
apply
to
all
major
stationary
sources
of
VOC
and
NOx
to
implement
major
NSR
under
the
1­
hour
ozone
NAAQS.
Our
1996
proposal
predated
promulgation
of
the
8­
hour
ozone
and
PM2.5
NAAQS
and
thus
did
not
explain
the
details
of
implementation
of
either
of
these
standards
under
§
51.165
or
appendix
S.

For
a
discussion
of
implementation
of
the
1­
hour
and
8­
hour
ozone
NAAQS
under
§
51.165
and
appendix
S,
see
Section
V.
of
13
this
preamble.
We
will
explain
implementation
of
the
PM2.5
NAAQS
in
NSR
permitting
in
a
separate
action.

On
June
2,
2003,
we
proposed
a
rule
to
identify
the
statutory
requirements
that
apply
for
purposes
of
developing
SIPs
under
the
CAA
to
implement
the
8­
hour
ozone
NAAQS.
(
68
FR
32802)
Specifically,
we
proposed
two
options­
one
in
which
all
nonattainment
areas
would
be
classified
and
regulated
under
subpart
2
of
part
D
of
title
I,
and
one
in
which
some
nonattainment
areas
would
be
regulated
under
the
less
restrictive
requirements
of
subpart
1
and
some
would
be
classified
and
regulated
under
subpart
2.
For
areas
classified
under
subpart
2
 
those
with
a
1­
hour
ozone
design
value
at
or
above
0.121
ppm
 
the
classifications
set
forth
in
subpart
2
(
marginal,
moderate,
etc.)
would
govern
part
D
SIPs
for
the
8­
hour
ozone
standard,
with
each
area's
classification
determined
by
a
modified
version
of
the
subpart
2
classification
table
containing
8­
hour
design
values
for
each
classification,
rather
than
the
1­
hour
design
values
in
that
table.
The
NSR
permitting
requirements
for
the
8­
hour
ozone
standard
necessarily
follow
from
the
classification
scheme
chosen
under
the
terms
of
subpart
1
and
subpart
2.
We
did
not
propose
specific
regulatory
language
for
implementation
of
NSR
under
the
8­

hour
NAAQS.
However,
we
indicated
that
we
intended
to
revise
the
nonattainment
NSR
regulations
to
be
consistent
with
the
rule
for
implementing
the
8­
hour
ozone
NAAQS.
(
68
FR
32844)
14
2.
Proposed
Changes
to
§
52.24
On
July
23,
1996,
we
proposed
to
revise
§
52.24
to
incorporate
changes
made
by
the
1990
Amendments
that
alter
the
applicability
of
the
construction
ban
provisions.
We
also
proposed
that
the
definitions
contained
in
§
51.165
would
apply
in
§
52.24.

We
proposed
changes
to
§
52.24(
a)
to
effectuate
new
requirements
under
the
1990
Amendments
concerning
construction
bans.
Under
the
1977
Amendments,

section
110(
a)(
2)(
I)
of
the
Act
required
the
EPA
to
place
certain
areas
under
a
federally
imposed
construction
moratorium
(
ban)
that
prohibited
the
construction
of
new
or
modified
major
stationary
sources
in
nonattainment
areas
where
the
State
failed
to
have
an
implementation
plan
meeting
all
of
the
requirements
of
part
D.
The
1990
amendments
removed
the
provision
under
section
110(
a)(
2)(
I)

requiring
this
prohibition
of
construction.
However,
in
section
110(
n)(
3)
of
the
Act
(
Savings
Clause),
the
1990
Amendments
retained
the
prohibition
in
cases
where
it
was
applied
prior
to
the
1990
Amendments
based
upon
a
finding
that
the
area:
(
1)
lacked
an
adequate
NSR
permitting
program
(
as
required
by
section
172(
b)(
6)
of
the
1977
Act);
or
(
2)

the
State
plan
failed
to
achieve
the
timely
attainment
of
the
NAAQS
for
sulfur
dioxide
by
December
31,
1982.
All
other
construction
bans
pursuant
to
section
110(
a)(
2)(
I)
are
lifted
as
a
result
of
the
new
statutory
provision.
This
15
includes
previously
imposed
construction
bans
based
upon
a
finding
that
the
plan
for
the
area
did
not
demonstrate
timely
attainment
and
maintenance
of
the
ozone
or
CO
NAAQS.

In
accordance
with
the
amended
section
110(
n)(
3)
of
the
Act,

any
construction
ban
retained
remains
in
effect
until
the
EPA
determines
that
the
SIP
meets
either
the
amended
part
D
permit
requirements,
or
the
requirements
under
subpart
5
of
part
D
for
attainment
of
the
NAAQS
for
sulfur
dioxide,
as
applicable.

Part
D
of
title
I
of
the
Act
contains
the
requirements
for
the
issuance
of
NSR
permits
to
new
or
modified
major
stationary
sources
in
nonattainment
areas
or
ozone
transport
regions.
To
issue
such
permits,
the
permitting
authority
must
first
find
pursuant
to
section
173(
a)(
4)
that
the
"
Administrator
has
not
determined
that
the
applicable
implementation
plan
is
not
being
adequately
implemented
for
the
nonattainment
area"
in
accordance
with
the
requirements
of
part
D.
If
the
Administrator
determines
that
the
SIP
for
meeting
the
part
D
requirements
is
not
being
adequately
implemented
for
the
nonattainment
area
where
the
new
source
or
modification
wants
to
locate,
permits
that
would
otherwise
meet
the
requirements
of
section
173
cannot
be
issued.
We
stated
our
intent
to
make
the
determination
by
letter
to
the
permitting
authority,
with
a
follow­
up
notice
to
be
published
in
the
Federal
Register
but
solicited
comment
on
the
need
to
undertake
notice­
and­
comment
procedures
before
taking
final
action.
16
Section
113(
a)(
5)
of
the
Act
provides
that
the
EPA
may
issue
an
order
prohibiting
the
construction
or
modification
of
any
major
stationary
source
in
any
area,
including
an
attainment
area,
where
the
Administrator
finds
that
the
State
is
out
of
compliance
with
the
NSR
requirements.

Specifically,
the
EPA
may
issue
an
order
under
section
113(
a)(
5)
banning
construction
in
an
area
whenever
the
Administrator
finds
that
a
State
is
not
acting
in
compliance
with
any
requirement
or
prohibition
of
the
Act
relating
to
construction
of
new
sources
or
the
modification
of
existing
sources.
To
codify
the
requirements
of
section
113(
a)(
5),
we
proposed
new
language
in
§
52.24(
c).

We
proposed
to
remove
the
transition
provisions
under
existing
§
52.24(
c)
and
(
g).
These
paragraphs
were
proposed
to
be
removed
because
they
were
originally
designed
to
clarify
the
applicable
requirements
for
permits
issued
prior
to
the
initial
SIP
revisions
required
by
the
1977
Amendments.

In
addition
to
the
significant
changes
already
discussed,
the
proposed
changes
to
§
52.24
included
several
minor
changes.
These
minor
changes
included:
(
1)
the
addition
of
requirements
applicable
to
transport
regions;

(
2)
the
inclusion
of
requirements
applicable
to
criteria
pollutant
precursors;
(
3)
incorporation
of
the
definitions
proposed
in
§
51.165(
a);
(
4)
revisions
to
the
language
at
§
52.24(
h)(
2);
and
(
5)
revisions
to
§
52.24(
j).
17
As
indicated
in
section
III.
B.
3
of
this
preamble,
on
December
31,
2002
(
67
FR
80187),
we
stated
our
intention
to
conform
the
regulatory
language
in
§
52.24
to
the
final
regulations
promulgated
on
that
date.
That
is,
all
of
the
provisions
of
§
51.165
apply
when
implementing
the
§
52.24
restrictions
on
new
source
growth.

We
note
that
§
52.24(
k)
was
not
included
in
the
proposed
rule
text.
However,
the
preamble
did
not
in
any
manner
indicate
that
EPA
believed
that
NSR
permits
complying
with
appendix
S
were
not
required
during
the
SIP
development
period
where
necessary.

Our
proposed
8­
hour
ozone
NAAQS
implementation
rule
explained
that
§
52.24(
k)
remained
in
effect
and
made
clear
that
it
would
be
retained.
In
that
action,
we
also
proposed
that
we
would
revise
§
52.24(
k)
to
reflect
the
changes
in
the
1990
Amendments.
(
68
FR
32846)
The
prior
language
at
§
52.24(
k)
allowed
States
to
issue
permits
under
appendix
S
for
a
maximum
period
of
18
months
after
designation.
After
this
time,
if
the
nonattainment
area
did
not
have
an
approved
part
D
NSR
permit
program,
a
construction
ban
would
apply.
Under
the
1977
CAA,
the
construction
ban
went
into
effect
on
July
1,
1979.
However,
in
1990,
Congress
altered
the
provisions
of
the
construction
ban
such
that
it
would
not
apply
when
a
State
lacked
an
approved
part
D
NSR
program
in
the
future.
Thus,
the
1990
Amendments
supersede
that
portion
of
prior
§
52.24
dealing
with
the
construction
ban
but
leave
unaltered
the
requirement
that
appendix
S
continue
18
to
apply
through
§
52.24
(
k).
We
proposed
to
allow
States
to
issue
permits
under
appendix
S
from
designation
to
approval
even
if
the
time
period
between
designation
and
approval
exceeds
18
months.

3.
Proposed
Changes
to
Appendix
S
On
July
23,
1996,
we
proposed
changes
to
the
major
NSR
program,
including
the
regulations
contained
in
40
CFR
51.165,
51.166,
52.21,
52.24,
and
part
51
appendix
S.
(
61
FR
38250)
The
specific
regulatory
language
for
the
proposed
changes
to
nonattainment
provisions
implementing
the
1990
Amendments
contained
in
§
51.165
(
discussed
above
in
Section
III.
B.
1
of
this
preamble)
also
applied
to
appendix
S.
(
61
FR
38252)
The
1996
proposal
concerned,
among
other
things,

five
major
changes
to
the
NSR
program­
baseline
emissions,

actual­
to­
projected­
actual
methodology,
Clean
Units,

Plantwide
Applicability
Limits
(
PALs),
and
Pollution
Control
Projects
(
PCPs).

On
December
31,
2002
(
67
FR
80187),
we
promulgated
final
changes
concerning
baseline
emissions,
actual­

toprojected
actual
methodology,
Clean
Units,
PALs,
and
PCPs.

We
stated
our
intention
to
conform
the
regulatory
language
in
appendix
S
and
§
52.24
to
the
final
regulations
promulgated
on
that
date.

Today's
actions
finalize
these
changes
to
the
regulations
for
both
the
approval
and
promulgation
of
implementation
plans
and
requirements
for
preparation,
19
adoption,
and
submittal
of
implementation
plans
governing
the
NSR
programs
mandated
by
parts
C
and
D
of
title
I
of
the
Act.
We
also
proposed
conforming
changes
to
40
CFR
(
Code
of
Federal
Regulations)
part
51,
appendix
S,
and
part
52.24.
Today
we
have
not
included
the
final
regulatory
language
for
these
regulations.
It
is
our
intention
to
include
regulatory
changes
that
conform
appendix
S
and
40
CFR
52.24
to
today's
final
rules
in
any
final
regulations
that
set
forth
an
interim
implementation
strategy
for
the
8­
hour
ozone
standard.
We
intend
to
finalize
changes
to
these
sections
precisely
as
we
have
finalized
requirements
for
other
parts
of
the
program.
Because
these
are
conforming
changes
and
the
public
has
had
an
opportunity
for
review
and
comment,
we
will
not
be
soliciting
additional
comments
before
we
finalize
them.

On
June
2,
2003
(
68
FR
32802),
we
explained
implementation
of
the
NSR
program
under
the
8­
hour
ozone
NAAQS
during
the
interim
SIP
development
period,
and
proposed
flexible
NSR
requirements
for
areas
that
expected
to
attain
the
8­
hour
NAAQS
within
three
years
after
designation.
For
a
nonattainment
area
in
a
State
with
a
SIP
that
specifically
lists
the
areas
in
which
part
D
NSR
applies,
or
in
areas
that
currently
have
no
nonattainment
plan
or
otherwise
lack
direct
authority
to
implement
NSR
for
the
8­
hour
ozone
NAAQS
through
a
SIP­
approved
permitting
program,
there
is
an
interim
period
between
the
designation
20
date
and
the
date
that
the
State
amends
its
SIP
either
to
list
any
new
nonattainment
areas
or
to
include
a
part
D
plan.
We
stated
that
the
existing
regulation
codified
at
40
CFR
52.24(
k)
requires
that
permits
be
issued
in
compliance
with
appendix
S
during
this
time,
and
that
in
the
absence
of
a
transitional
NSR
program,
a
State
would
have
to
continue
implementing
part
D
nonattainment
requirements
under
appendix
S.
(
68
FR
32846­
48.)
Consistent
with
our
1996
NSR
Reform
proposal,
we
also
proposed
that
both
nonattainment
NSR
and
PSD
regulations
be
amended
to
expressly
include
NOx
as
an
ozone
precursor
in
the
PSD
and
nonattainment
major
NSR
programs.
We
also
proposed
that,
as
provided
under
CAA
section
182(
f),
a
waiver
from
nonattainment
NSR
for
NOx
as
an
ozone
precursor
would
be
available
for
both
subpart
1
and
subpart
2
areas.
(
68
FR
32846)

With
regard
to
transitional
NSR
permitting,
we
proposed
to
limit
the
exemption
from
NSR
permitting
in
Section
VI
of
appendix
S
to
nonattainment
areas
meeting
certain
requirements.
(
68
FR
32844)
The
Transitional
NSR
program
would
only
apply
in
nonattainment
areas
that
are
attaining
the
1­
hr
NAAQS,
are
subject
to
subpart
1
(
rather
than
subpart
2)
of
part
D
of
title
I,
have
submitted
an
attainment
plan
by
April
15,
2004
that
demonstrates
attainment
within
3
years
after
designation,
and
have
submitted
an
attainment
plan
containing
any
additional
local
control
measures
needed
for
attainment
of
the
8­
hour
21
standard.
(
68
FR
32847)
We
proposed
that
sources
under
the
Transitional
NSR
program
would
be
subject
to
BACT
instead
of
LAER
and
would
not
be
required
to
obtain
source­
specific
offsets.

On
August
6,
2003
(
68
FR
46536),
we
solicited
comment
on
additional
options
for
implementing
NSR
under
the
8­
hour
NAAQS,
including
a
major
rewrite
of
appendix
S
that
would
include
the
proposed
changes
to
Section
VI,
as
well
as
the
December
31,
2002
Reform
rule
changes.

IV.
Description
of
Today's
Final
Action
and
Legal
Basis
A.
Final
Action
and
Legal
Basis
for
Changes
to
§
51.165
1.
Final
Changes
to
§
51.165
In
today's
final
action,
we
have
revised
§
51.165
to
incorporate
the
major
stationary
source
thresholds,

significant
emission
rates,
and
offset
ratios
for
sources
of
ozone
precursors
pursuant
to
part
D
of
title
I
of
the
1990
amendments
to
the
CAA.
[
See
§
51.165(
a)(
1)(
iv),
(
a)(
1)(
v),

(
a)(
1)(
x),
(
a)(
8),
and
(
a)(
9).]
Consistent
with
statutory
requirements
and
the
final
rules
in
40
CFR
51,
subpart
X,

Provisions
for
Implementation
of
8­
hour
Ozone
NAAQS,
part
D
NSR
SIPs
implementing
the
8­
hour
ozone
standard
must
comply
with
the
standards
set
forth
in
subpart
1
of
part
D
of
title
I,
and
in
the
case
of
subpart
2
areas,
the
standards
set
forth
for
the
relevant
classification.
We
note
that
the
specific
provisions
for
determining
whether
an
area
is
designated
under
subpart
1
or
subpart
2
are
included
in
40
CFR
51,
subpart
X,
and
explained
in
the
preamble
to
those
22
final
rules
at
69
FR
23954.
All
nonattainment
areas
have
been
categorized
as
subpart
1
or
subpart
2
areas
in
40
CFR
part
81.
(
69
FR
23858)
As
proposed,
areas
with
1­
hour
ozone
design
values
below
0.121
ppm
were
designated
under
subpart
1,
and
areas
with
1­
hour
ozone
design
values
at
or
above
0.121
ppm
received
a
classification
under
subpart
2,

based
on
the
modified
version
of
the
subpart
2
table
containing
8­
hour
ozone
design
values
for
each
classification.
Now
that
those
designations
and
classifications
have
been
made,
the
NSR
program
requirements
(
including
the
specific
major
stationary
thresholds,

significant
emission
rates,
and
offset
ratios
associated
with
each
classification)
are
determined
by
reference
to
subpart
1
and
subpart
2,
as
codified
in
§
51.165
through
this
rulemaking.
Under
subpart
1,
the
major
stationary
source
threshold
is
100
tons
per
year
(
tpy),
and
an
offset
ratio
of
at
least
1:
1
applies.
Under
subpart
2,
the
major
stationary
source
threshold
ranges
from
10
to
100
tpy,
depending
on
the
classification
of
the
nonattainment
area
in
which
the
source
is
located.
The
applicable
offset
ratios
range
from
1:
1
to
1:
5,
also
depending
on
the
classification
of
the
nonattainment
area
in
which
the
source
is
located.

We
also
have
finalized
as
proposed
in
1996
and
2003
that
the
NSR
requirements
applicable
to
major
stationary
sources
of
VOC
(
including
provisions
regarding
major
modifications,
significant
emission
rates,
and
offsets)
4We
proposed
at
68
FR
32840
to
establish
NOx
waiver
provisions
identical
to
those
in
section
182(
f)
for
areas
subject
to
subpart
1.
We
intend
to
promulgate
final
rules
concerning
the
applicability
of
NOx
waivers
in
subpart
1
areas
as
part
of
our
Phase
II
Final
Rule
to
Implement
the
8­
hour
Ozone
NAAQS.
We
will
also
address
implementation
issues
related
to
NOx
waivers
under
the
1­
hour
and
8­
hour
NAAQS
in
future
rulemaking
and
guidance.
23
apply
to
nitrogen
oxide
emissions.
These
requirements
apply
except
where
the
Administrator
determines,
according
to
the
standards
set
forth
in
section
182(
f),
that
net
air
quality
benefits
are
greater
in
the
absence
of
reductions
of
nitrogen
oxide
emission
reductions.
[
See
§
51.165(
a)(
8).]

We
note
that
whether
a
NOx
waiver
under
section
182(
f)

applies
in
a
particular
area
and
the
effects
of
NOx
waivers
on
RACT
are
not
NSR
permitting
determinations,
and
are
thus
beyond
the
scope
of
this
rulemaking.
4
We
are
not
taking
final
action
to
implement
the
special
modification
provisions
at
CAA
sections
182(
c),
(
d),
and
(
e)

for
serious,
severe,
and
extreme
ozone
nonattainment
areas
at
this
time.
We
are
evaluating
additional
issues
related
to
implementation
of
the
8­
hour
ozone
standard,
and
anticipate
addressing
specific
issues
in
the
future.

As
proposed
on
July
23,
1996
(
61
FR
38250),
we
have
incorporated
requirements
in
part
D
of
title
I
of
the
1990
amendments
to
the
CAA
for
carbon
monoxide.
[
See
§
51.165(
a)(
1)(
iv)(
A)(
1)(
v)
and
(
a)(
1)(
x)(
D).]
We
have
not
made
final
changes
to
incorporate
the
requirements
of
the
1990
Amendments
concerning
PM­
10
nonattainment
areas,
as
we
intend
for
these
to
be
addressed
in
a
separate
action.
24
We
are
also
not
taking
final
action
concerning
the
use
of
offsets
of
emission
reductions
achieved
by
shutting
down
an
existing
source
or
curtailing
production
or
operating
hours
below
baseline
levels.
We
have
not
decided
what
final
action
we
will
take
concerning
these
provisions.

2.
Legal
Basis
In
areas
not
meeting
health­
based
NAAQS
and
in
OTR,
the
major
NSR
program
is
implemented
under
the
requirements
of
section
110(
a)(
2)(
C)
and
part
D
of
title
I
of
the
Act.

Subpart
1
of
part
D
of
title
I
contains
general
requirements
for
nonattainment
areas
for
any
criteria
pollutant,
subpart
2
contains
provisions
specifically
for
ozone
nonattainment
areas,
and
subpart
3
contains
provisions
specifically
for
carbon
monoxide
nonattainment
areas.
On
July
23,
1996
(
61
FR
38250),
we
proposed
changes
to
§
51.165
to
incorporate
requirements
in
part
D
of
title
I
of
the
1990
amendments
to
the
CAA
for
ozone,
carbon
monoxide,
and
PM­
10
nonattainment
areas.

We
promulgated
a
new
8­
hour
ozone
NAAQS
on
July
18,

1997.
We
indicated
that
we
anticipated
that
States
would
implement
the
8­
hour
ozone
NAAQS
under
the
less
prescriptive
subpart
1
requirements.
In
February
2001,
the
Supreme
Court
ruled
that
the
statute
was
ambiguous
as
to
the
relationship
of
subparts
1
and
2
for
purposes
of
implementing
the
8­
hour
ozone
NAAQS.
In
Whitman
v.
American
Trucking
Associations,

[
531
U.
S.
457,
482­
86
(
2001)],
the
Supreme
Court
reviewed
25
EPA's
implementation
strategy
for
the
revised
8­
hour
ozone
NAAQS,
and
remanded
it
to
EPA
to
develop
a
reasonable
resolution
of
the
roles
of
subparts
1
and
2
in
classifying
areas
for
and
implementing
the
revised
ozone
standard.
On
April
30,
2004,
we
promulgated
a
final
rule
to
implement
the
8­
hour
ozone
NAAQS
(
69
FR
23951),
in
which
some
nonattainment
areas
would
be
regulated
under
the
less
restrictive
requirements
of
subpart
1
and
some
would
be
classified
and
regulated
under
subpart
2.
All
ozone
nonattainment
areas
have
now
been
categorized
subpart
1
or
subpart
2
areas
in
40
CFR
part
81.
Now
that
those
designations
and
classifications
have
been
made,
the
NSR
program
requirements
(
including
the
specific
major
stationary
source
thresholds,
significant
emission
rates,

and
offset
ratios
associated
with
each
classification)
are
determined
by
reference
to
subpart
1
and
subpart
2,
as
codified
in
§
51.165
through
this
rulemaking.
Thus,
as
described
in
further
detail
in
Section
IV.
A.
1
of
this
preamble,
we
have
incorporated
the
requirements
of
the
1990
amendments
for
major
stationary
sources
of
ozone
precursors
in
ozone
nonattainment
areas
as
proposed
in
1996,
and
codified
those
requirements
for
the
8­
hour
standard
consistent
with
the
designation
and
classification
scheme
finalized
in
the
8­
hour
ozone
implementation
rule
(
69
FR
23951)
promulgated
in
response
to
Whitman
v.
American
Trucking
Associations,
531
U.
S.
457
(
2001).

B.
Final
Action
and
Legal
Basis
for
Changes
to
§
52.24
26
1.
Final
Action
With
one
exception,
we
are
promulgating
final
changes
to
§
52.24
as
proposed.
We
have
retained
the
provision
in
§
52.24(
k)
specifying
that
appendix
S
governs
permits
to
construct
and
operate
applied
for
during
the
period
between
the
date
of
designation
as
nonattainment
and
the
date
the
part
D
plan
is
approved.
In
1996,
the
preamble
explained
that
the
changes
to
§
52.24
were
intended
only
to
update
and
clarify
the
regulation
with
regard
to
the
changes
to
the
construction
ban
made
by
the
1990
Amendments.
(
61
FR
38250,

38305)
The
preamble
did
not
in
any
manner
indicate
that
EPA
believed
that
NSR
permits
complying
with
appendix
S
were
not
required
during
the
SIP
development
period
where
necessary.

Additionally,
it
did
not
contemplate
nonattainment
major
NSR
permitting
in
light
of
the
situation
that
today's
final
action
addresses,
which
is
the
need
to
permit
nonattainment
area
sources
during
a
transition
period
in
which
a
substantial
number
of
new
nonattainment
areas
are
being
created.
Therefore,
we
are
retaining
§
52.24(
k).

As
we
proposed
in
the
8­
hour
ozone
NAAQS
implementation
rule
(
68
FR
32846),
we
have
made
one
change
to
the
regulatory
language
in
§
52.24(
k).
The
previous
language
at
§
52.24(
k)
only
allowed
States
to
issue
permits
under
appendix
S
for
a
maximum
period
of
18
months
after
designation.
This
language
was
consistent
with
the
previous
SIP
development
period
and
construction
ban
under
the
1977
5Appendix
S
was
originally
promulgated
in
1976
to
address
whether,
and
to
what
extent,
new
and
modified
sources
would
be
allowed
to
construct
in
nonattainment
areas
whose
attainment
deadlines
had
already
passed,
in
light
of
the
regulatory
requirement
that
new
or
modified
sources
be
disapproved
where
the
source
would
interfere
with
attainment
of
the
NAAQS.
41
FR
55524
(
Dec.
21,
1976).
It
required,
inter
alia,
compliance
with
the
lowest
achievable
emission
rate
(
LAER)
and
offsetting
emission
27
Act,
which
no
longer
apply
under
the
1990
CAA.
We
have
revised
§
52.24(
k)
to
allow
States
to
issue
permits
under
appendix
S
from
designation
until
the
SIP
is
approved,
even
if
this
exceeds
18
months.
As
we
noted
in
our
proposal,

this
change
implements
the
removal
of
the
construction
ban
from
the
1990
Amendments
and
is
consistent
with
our
1991
policy
memo,
"
New
Source
Review
(
NSR)
program
Transitional
Guidance,
John
S.
Seitz,
March
11,
1991.

2.
Legal
Basis
Section
110(
a)(
2)(
C)
does
not
define
specific
requirements
States
must
follow
for
issuing
major
source
permits
during
the
interim
period
between
nonattainment
designation
and
EPA
approval
of
a
nonattainment
NSR
SIP.

However,
we
have
historically
recognized
that
the
SIP
development
period
provided
for
in
section
172(
b)
leaves
a
gap
in
part
D
major
NSR
permitting
and
have
determined
that
this
gap
is
to
be
filled
with
an
interim
major
NSR
program
that
is
substantially
similar
to
the
requirements
of
part
D,

including
the
LAER
and
offset
requirements
from
part
D,

subject
to
a
limited
exemption
where
the
attainment
deadline
will
be
met.
(
57
FR
18070,
18076).
This
interim
NSR
program
has
been
implemented
to
date
through
appendix
S.
5
reductions
in
excess
of
the
new
source's
emissions.
At
that
time,
Part
D
NSR
was
not
part
of
the
CAA.
When
the
Part
D
NSR
provisions
were
added
in
the
1977
Amendments
to
the
CAA,
Congress
added
the
requirement
that
SIPs
contain
nonattainment
NSR
provisions
as
set
forth
in
Section173,
including
LAER
and
the
requirement
to
either
offset
the
increase
in
new
source
emissions
or
ensure
that
emissions
fell
within
a
growth
allowance.
(
The
growth
allowance
provision
was
repealed
in
1990.)
Additionally,
Congress
provided
that
Appendix
S
would
govern
preconstruction
permitting
in
areas
lacking
approved
Part
D
SIPs
before
a
construction
ban
went
into
effect,
as
discussed
in
more
detail
above.

28
Our
regulations
at
40
CFR
§
52.24(
k)
require
States
to
follow
appendix
S
during
this
time.
Additionally,
in
the
1977
Clean
Air
Act
Amendments,
Congress
indicated
its
intent
that
major
NSR
permitting
apply
during
the
SIP
development
period.
[
See
Pub.
L.
No.
95­
95,
§
129(
a),
91
Stat.
685
(
1977).]
Specifically,
in
1977,
when
Congress
enacted
a
moratorium
on
construction
in
any
area
lacking
an
approved
part
D
NSR
SIP,
with
a
delayed
effective
date
of
July
1,

1979,
Congress
provided
that
appendix
S
govern
permitting
of
sources
constructing
in
such
areas
prior
to
that
date,

subject
to
a
limited
waiver
by
the
Administrator.
Id.

108(
b),
129(
a).
We
subsequently
codified
the
use
of
appendix
S
as
the
interim
major
NSR
program
in
40
CFR
§
52.24(
k),
reasoning
(
in
the
context
of
implementing
a
delay
in
the
construction
ban
for
then­
recently
designated
nonattainment
areas)
that
Congress
had
provided
that
appendix
S
would
remain
in
effect
to
protect
air
quality
while
State
plans
were
being
designed.
(
45
FR
91604)
When
Congress
removed
the
construction
ban
(
except
as
provided
in
6
See
Alabama
Power
Co.
v.
Costle,
636
F.
3d
323,
346­
047
(
D.
C.
Cir.
1980)
(
discussing
Sierra
Club
v.
Ruckelshaus,
344
F.
Supp.
253
(
D.
D.
C.
1972),
aff'd
per
curiam
4
ERC
1815
(
D.
C.
Cir.
1972),
aff'd
by
an
equally
divided
court,
sub
nom
Fri
v.
Sierra
Club,
412
U.
S.
541
(
1973).

29
section
110(
n)(
3)),
it
left
in
place
40
CFR
§
52.24(
k),

implementing
the
interim
major
NSR
program
under
appendix
S.

The
continued
application
of
appendix
S
through
§
52.24(
k)
is
also
supported
by
the
purpose
of
the
CAA,

specifically,
Section
101(
b)(
1),
"
to
protect
and
enhance
the
quality
of
the
Nation's
air
resources
so
as
to
promote
the
public
health
and
welfare
and
the
productive
capacity
of
its
population."
This
provision
was
the
basis
for
the
original
judicial
finding
that
the
Act
imposed
an
obligation
to
prevent
significant
deterioration
in
areas
that
meet
the
NAAQS,
prior
to
Congress'
enactment
of
the
PSD
program
at
Part
C
of
the
Act.
6
This
policy
of
non­
degradation
applies
with
even
greater
force
in
areas
that
fail
to
meet
the
NAAQS.
Thus,
we
believe
that
an
interim
major
NSR
program
for
the
SIP
development
period
­
as
codified
at
appendix
S
and
updated
to
reflect
CAA
amendments­
is
supported
by
section
110(
a)(
2)(
C),
section
101(
b)(
1),
Congressional
intent,
and
our
gapfilling
authority
under
section
301(
a).

With
the
exception
of
the
retention
of
§
52.24(
k)
as
discussed
above,
we
are
promulgating
final
changes
to
§
52.24
as
proposed.
For
the
reasons
stated
in
Section
III.
B.
2.
of
this
preamble,
these
changes
effectuate
requirements
at
sections
110(
n)(
3),
173(
a)(
4),
113(
a)(
5)
of
the
1990
30
Amendments
concerning
construction
bans.

C.
Final
Action
and
Legal
Basis
for
Changes
to
Appendix
S
1.
Changes
to
Incorporate
1990
Amendments
The
changes
that
we
discuss
in
Section
IV.
A.
of
this
preamble
for
§
51.165
concerning
major
stationary
sources
of
ozone
precursors
and
the
applicable
offset
ratios
have
also
been
made
in
appendix
S.
These
changes
are
in
Section
II
(
definitions
of
major
stationary
source,
major
modification,

and
significant)
and
IV.
M.
and
N.
of
appendix
S.
As
with
§
51.165,
we
are
not
taking
final
action
to
implement
the
special
modification
provisions
at
CAA
sections
182(
c),
(
d),

and
(
e)
for
serious,
severe,
and
extreme
ozone
nonattainment
areas
at
this
time.
We
are
evaluating
additional
issues
related
to
implementation
of
the
8­
hour
ozone
standard,
and
anticipate
addressing
specific
issues
in
a
future
rulemaking
and
guidance.

As
proposed
on
July
23,
1996
(
61
FR
38250),
we
have
incorporated
requirements
in
part
D
of
title
I
of
the
1990
amendments
to
the
CAA
for
carbon
monoxide.
We
have
not
made
final
changes
to
incorporate
the
requirements
of
the
1990
Amendments
concerning
PM­
10
nonattainment
areas,
as
we
intend
for
these
to
be
addressed
in
a
separate
final
action.

As
with
§
51.165,
we
are
also
not
taking
final
action
concerning
the
use
of
offsets
of
emission
reductions
achieved
by
shutting
down
an
existing
source
or
curtailing
production
or
operating
hours
below
baseline
levels.
We
31
have
not
decided
what
final
action
we
will
take
concerning
these
provisions.
As
with
the
final
rules
in
§
51.165,
we
are
not
taking
final
action
on
special
modification
provisions
implementing
section
182(
c),
(
d),
and
(
e)
for
serious,
severe,
and
extreme
ozone
nonattainment
areas.
We
are
also
not
taking
final
action
on
changes
to
the
requirements
for
emission
credits
from
source
shutdowns
and
curtailments.

As
appendix
S
predates
the
revision
to
the
statute,

requirements
in
the
1990
Amendments
limiting
the
use
of
offsets
are
not
explicitly
included
in
appendix
S.

Nonetheless,
these
requirements
apply
to
sources
permitted
using
appendix
S
because
appendix
S
is
intended
to
reflect
the
same
offset
requirements
in
part
D
of
the
Act.
These
requirements
concern
provisions
relating
to
offsets
and
reasonable
further
progress.
Section
173(
c)(
1)(
B)
requires
that
offsets
must
be
in
effect
and
enforceable
by
the
time
a
new
or
modified
source
commences
operation.
Section
173(
c)(
2)
requires
that
emission
reductions
that
are
otherwise
required
under
the
Act
cannot
be
creditable
as
offsets.

The
1977
Clean
Air
Act
is
silent
concerning
the
location
of
offsetting
emissions.
As
we
noted
in
footnote
9
to
Section
IV.
D.
of
appendix
S,
in
the
absence
of
specific
statutory
language,
we
developed
an
interim
policy
on
offset
locations.
The
1990
Amendments
to
the
Clean
Air
Act
at
32
section
173(
c)(
1),
however,
placed
specific
limits
on
the
location
of
offsets.
Furthermore,
as
we
noted
in
the
proposed
rule
implementing
the
8­
hour
ozone
NAAQS,
there
have
been
a
number
of
recent
advances
in
the
scientific
understanding
of
ozone
formation.
(
68
FR
32807,
32848)
The
specific
provisions
of
appendix
S
concerning
location
of
offsets
are
outdated.
Thus,
we
have
conformed
appendix
S
at
IV.
D.
to
the
1990
Amendments
by
replacing
the
interim
policy
on
offsetting
emissions
with
the
statutory
language
at
section
173(
c)(
1).

Also,
we
note
that
the
definition
of
net
emissions
increase
at
§
51.165(
a)(
1)(
vi)(
E)
requires
that
a
decrease
in
actual
emissions
is
creditable
only
to
the
extent
that
the
State
has
not
relied
on
it
in
demonstrating
attainment
or
reasonable
further
progress
(
RFP).
This
requirement
has
never
been
codified
in
appendix
S.
However,
the
1990
CAA
at
section
173(
a)(
1)(
A)
requires
that
offsetting
emission
reductions
must
be
obtained
such
that
RFP
is
assured.
While
we
are
not
revising
the
appendix
S
definition
of
net
emissions
increase
,
State
and
local
agencies
should
consider
the
effect
of
creditable
decreases
from
permitting
under
appendix
S
in
their
planning
for
demonstrating
attainment
and
RFP.

Appendix
S
at
Section
IV.
E.
contains
provisions
regarding
the
relationship
between
offsets,
reasonable
progress
towards
attainment,
and
reasonable
further
33
progress.
Under
the
1990
CAA,
section
173(
a)(
1)(
A)
was
revised
to
set
forth
the
extent
to
which
offsets
must
represent
reasonable
further
progress,
as
defined
in
section
171.
Therefore,
we
have
removed
the
language
concerning
reasonable
progress
in
Section
IV.
E.
of
appendix
S
and
replaced
it
with
the
statutory
requirements
at
173(
a)(
1)(
A).

2.
Changes
to
Conform
to
Major
NSR
Program
In
today's
final
action,
we
have
revised
appendix
S
as
proposed
to
conform
the
regulatory
language
in
appendix
S
to
that
of
the
other
major
NSR
program
regulations.

Specifically,
the
changes
proposed
in
1996
concerning
baseline
emission
determinations,
actual­
to­
projected­
actual
methodology,
PALs,
Clean
Units,
and
PCP
have
been
incorporated
in
Sections
II
and
IV
of
appendix
S.
As
indicated
at
67
FR
80187,
we
have
finalized
the
changes
to
appendix
S
precisely
as
we
have
finalized
requirements
for
other
parts
of
the
program.
Table
1
shows
where
to
find
these
changes
in
appendix
S.

TABLE
1.­­

For
the
following
provision...
Added
to
§
51.165
in
December
2002
at...
Analogous
provisions
have
been
added
to
appendix
S
at
Section
Offsets
(
a)(
3)(
ii)(
H)
through
(
J)
IV.
C.
7.
through
9.

Applicability
test
(
a)(
2)(
ii)
IV.
G.
1.

Projected
actual
emissions
(
a)(
6)
IV.
H.
34
Clean
Unit
provisions
for
emissions
units
subject
to
LAER
(
c)
IV.
I.

Clean
Unit
provisions
for
emissions
units
achieving
emission
limitation
comparable
to
LAER
(
d)
IV.
J.

PCP
exclusion
(
e)
IV.
K.

Actuals
PALs
(
f)
IV.
L.

Severability
(
g)
IV.
O.
3.
Changes
to
Section
VI
We
are
not
finalizing
the
Transitional
NSR
program
under
Section
VI
of
appendix
S
as
proposed,
which
would
have
imposed
additional
eligibility
requirements
to
limit
the
exemption
from
NSR
permitting
in
Section
VI.
Upon
further
reflection
and
consideration
of
public
comments,
we
have
retained
the
original
eligibility
conditions,
and
added
a
procedural
requirement
that
the
Administrator
must
first
make
a
determination
that
Section
VI
applies
for
a
specific
situation.

As
we
noted
at
68
FR
32848,
on
its
surface
Section
VI
could
apply
in
any
nonattainment
area
where
the
dates
for
attainment
have
not
passed
if
the
source
meets
all
applicable
SIP
emission
limitations
and
would
not
interfere
with
the
area's
ability
to
meet
its
attainment
date,
without
7
The
Section
VI
exemption
applies
in
areas
where
the
attainment
deadline
for
the
primary
or
secondary
NAAQS
has
not
passed.
We
note
that
the
language
in
Section
VI
regarding
secondary
NAAQS
has
not
been
updated
to
reflect
the
change
in
the
attainment
deadline
from
a
"
reasonable
time"
under
section
110(
a)(
2)(
F)
of
the
1970
Clean
Air
Act,
to
"
as
expeditiously
as
practicable"
in
section
172(
a)(
2)(
B).
Because
this
change
does
not
affect
the
scope
of
Section
VI,
and
we
have
not
proposed
to
update
the
references
in
Section
VI
to
secondary
NAAQS,
we
are
not
undertaking
this
change
in
this
final
rule.

35
providing
any
specific
safeguards
for
such
noninterference.
7
As
we
noted
at
proposal,
however,
we
believe
that
an
area
generally
will
not
be
able
to
show
that
it
will
continue
to
meet
its
attainment
date
if
it
does
not
apply
LAER
or
offsets.
(
68
FR
32848)

We
continue
to
believe,
as
stated
in
the
proposal,
that
Section
VI
should
not
be
interpreted
as
allowing
a
blanket
exemption
from
LAER
and
offsets
before
attainment
dates
have
passed.
However,
we
do
not
believe
that
the
program
as
proposed
at
69
FR
32846
is
implementable.
As
many
commenters
noted,
the
April
15,
2004
deadline
for
submission
of
attainment
plans
and
December
31,
2004
deadline
for
implementation
of
all
necessary
attainment
controls
were
impracticable.
We
agree
with
the
many
commenters
who
supported
flexible
NSR
requirements
under
Section
VI
for
some
areas
and
maintained
that
attainment
would
not
be
in
jeopardy
due
to
such
programs.
While
we
do
not
identify
any
such
particular
instances
in
today's
final
rule,
we
believe
that
participation
in
programs
such
as
the
NOx
SIP
call
and
the
Clean
Air
Interstate
Rule
proposal
(
69
FR
4566,
Jan.
30,
36
2004)
will
achieve
significant
emission
reductions
across
broad
geographical
areas.
Certainly
we
want
to
encourage
development
of
programs
that
address
transported
air
pollution.
We
recognize
that
these
and
other
programs
may
prove
to
be
more
effective
in
reducing
pollution,
as
well
as
more
practicable,
than
relying
on
offsets
from
a
single
source.

For
these
reasons,
we
have
retained
the
original
eligibility
conditions
for
exemption
from
the
LAER
and
offset
requirements,
and
added
a
procedural
requirement
that
the
Administrator
provides
public
notice
that
Section
VI
applies
for
a
specific
situation.
This
requirement
will
effectuate
the
proposal's
purpose
of
providing
a
safeguard
to
ensure
that
sources
exempted
from
LAER
and
offsets
under
Section
VI
will
be
in
compliance
with
the
original
condition
regarding
noninterference
with
the
attainment
deadline.

4.
Other
Appendix
S
Changes
We
have
made
one
additional
change
to
appendix
S.

Concerning
major
NSR
applicability,
we
are
taking
the
remaining
steps
necessary
to
finalize
our
proposal
to
remove
the
50­
ton
exemption.
In
1978
(
43
FR
26408)
and
1979
(
44
FR
3276),
we
proposed
that
applicability
under
PSD
and
appendix
S
respectively
be
based
on
uncontrolled
emissions,
but
sources
would
be
exempt
from
control
requirements
unless
the
increase
in
allowable
emissions
was
at
least
50
tons
per
year,
1,000
pounds
per
day,
or
100
pounds
per
hour.
The
8
See
Emission
Offset
Exemptions
for
Resource
Recovery
Facilities
from
Gerald
A
Emison,
Director,
Office
of
Air
Quality
Planning
and
Standards,
December
28,
1988.

37
U.
S.
Court
of
Appeals
for
the
District
of
Columbia
Circuit,

however,
ruled
that
major
source
applicability
should
be
based
on
potential
to
emit,
rather
than
uncontrolled
emissions.
Alabama
Power
Co.
v.
Costle,
606
F.
2d
1068
(
D.
C.

Cir.
1979),
amended
636
F.
3d
323,
356­
57
(
D.
C.
Cir.
1980).

The
court
also
ruled
that
EPA
had
exceeded
its
authority
in
establishing
the
50
tpy
exemption
and
remanded
the
exemption
for
reconsideration.
In
response,
we
proposed
removing
the
50
tpy
exemption
from
the
PSD
rules
and
appendix
S
in
the
1979
NPRM.
(
44
FR
51930)
We
finalized
these
changes
in
1980,
but
we
inadvertently
did
not
remove
the
change
in
all
the
places
in
appendix
S
where
it
was
located,
specifically
footnotes
5
and
8
to
IV.
D.
We
are
now
finalizing
the
1979
proposal
to
the
extent
it
remained
incomplete,
by
removing
these
last
two
references
to
the
50
tpy
exemption.

We
are
also
restating
our
policy
on
offsets
from
resource
recovery
facilities
under
appendix
S.
Appendix
S
at
IV.
B.(
i)
exempts
resource
recovery
facilities
from
permitting
under
certain
circumstances.
Our
1988
policy
memo
indicates
that
as
a
matter
of
policy,
EPA
no
longer
adheres
to
the
offset
exemption
for
resource
recovery
facilities
in
appendix
S.
8
As
we
did
not
propose
to
change
this
provision,
we
are
not
revising
the
final
rules
today
regarding
resource
recovery
facilities.
However,
we
plan
to
9
The
1991
NSR
transitional
guidance
issued
to
address
implementation
of
the
1990
Amendments
acknowledged
that
appendix
S
did
not
contain
at
that
time
the
newly
enacted
part
D
provisions,
and
further
provided
that
the
new
requirements
of
part
D
to
title
I
did
not
apply
until
November
15,
1992
for
the
ozone
nonattainment
areas;
June
30,
1992,
for
the
PM­
10
nonattainment
areas;
and
three
years
from
designation
for
most
carbon
monoxide
nonattainment
areas.
NSR
Program
Transitional
Guidance,
at
A5
(
Mar.
11,
1991).
We
later
clarified
that
the
1990
Amendments
did
apply
to
all
permits
after
those
deadlines
passed.
NSR
Supplemental
Program
Transitional
Guidance
on
Applicability
of
New
Part
D
NSR
Requirements
at
3
(
Sept.
3,
1992).

38
remove
this
exemption
in
a
future
rulemaking.

5.
Legal
Basis
The
revisions
to
incorporate
the
requirements
of
the
1990
Amendments
to
part
D
of
title
I
of
the
Act,
which
we
discuss
in
Section
IV.
C.
1
of
this
preamble,
are
necessary
to
make
appendix
S
consistent
with
part
D.
As
we
discuss
in
Section
IV.
B.
2.
of
this
preamble,
we
have
determined
that
Congress
intended
for
permitting
equivalent
to
the
part
D
NSR
provisions
to
apply
during
the
SIP
development
period
through
the
use
of
appendix
S
(
subject
to
the
limited
Section
VI
exemption).
In
light
of
this
determination,

there
is
no
reasonable
basis
for
declining
to
implement
the
NSR
requirements
in
the
1990
Amendments
during
that
period.
9
Additionally,
appendix
S
provides
on
its
face
that
it
is
an
interpretation
of
the
NSR
permitting
rules
in
subpart
I,

including
§
51.165.
Therefore,
it
is
necessary
to
have
appendix
S
reflect
substantially
the
same
requirements
as
10
Thus,
EPA
has
typically
conformed
appendix
S
to
the
part
D
nonattainment
NSR
permitting
provisions
governing
SIPs
at
40
CFR
§
51.165
(
originally
codified
at
§
51.18)
whenever
those
regulations
were
revised.
See,
for
example,
45
FR
52676
(
Aug.
7,
1980);
47
FR
27554
(
June
25,
1982);
49
FR
(
Oct.
26,
1984);
54
FR
27274
(
June
28,
1989);
57
FR
3941
(
Feb.
3,
1992).

39
are
in
§
51.165.10
Thus,
we
proposed
to
amend
appendix
S
in
this
manner
in
the
1996
NSR
proposal.
We
also
are
mindful
of
the
Supreme
Court's
decision
in
American
Trucking
Associations.
Although
the
decision
did
not
directly
address
NSR
implementation
during
the
SIP
development
period,
the
Court
emphasized
the
importance
of
creating
a
role
for
subpart
2
in
implementation
of
the
8­
hour
ozone
NAAQS.
We
believe
this
suggests
the
need
to
create
a
role
for
subpart
2
in
appendix
S,
in
contrast
to
the
exclusive
subpart
1
scheme
currently
embodied
in
appendix
S.

We
discuss
final
changes
to
conform
appendix
S
to
the
major
NSR
program
in
§
51.165
in
Section
IV.
C.
2
of
this
preamble.
The
legal
basis
for
these
changes
is
the
same
as
that
set
forth
in
the
preamble
to
the
December
31,
2002,

final
rule,
making
these
same
changes
to
the
other
major
NSR
regulations.
Additionally,
we
believe
it
is
necessary
to
have
appendix
S
reflect
substantially
the
same
requirements
as
codified
at
40
CFR
51.165
because
it
is
an
interpretation
of
the
NSR
permitting
rules
at
40
CFR
part
51
subpart
I,

including
§
51.165,
as
discussed
above.

The
legal
basis
for
appendix
S
itself,
including
Section
VI,
is
discussed
in
detail
in
Section
IV.
B.
2
of
this
40
preamble.
We
have
historically
recognized
that
the
SIP
development
period
provided
for
in
section
172(
b)
leaves
a
gap
in
part
D
major
NSR
permitting
and
have
determined
that
this
gap
is
to
be
filled
with
an
interim
major
NSR
program
that
is
substantially
similar
to
the
requirements
of
part
D,

including
the
LAER
and
offset
requirements
from
part
D,

subject
to
a
limited
exemption
where
the
attainment
deadline
will
be
met.
(
57
FR
18070,
18076).
This
interim
NSR
program
has
been
implemented
to
date
through
appendix
S.

We
also
believe
that,
contrary
to
objections
made
by
some
commenters,
appendix
S
­
and
in
particular,
Section
VI
­
has
not
been
superseded
by
the
1990
Amendments
to
title
I
of
the
Act.
In
short,
appendix
S
only
applies
where
an
NSR
permitting
program
for
the
new
or
revised
NAAQS
is
not
otherwise
in
effect,
and
thus
does
not
replace
any
part
D
NSR
SIP
provisions,
as
many
commenters
erroneously
believed.

That
is,
it
applies
only
in
newly
designated
or
redesignated
nonattainment
areas
lacking
approved
part
D
programs
for
a
new
or
revised
NAAQS,
such
as
the
8­
hour
ozone
NAAQS.
Thus,

the
evasion
of
subpart
2
requirements
posited
by
commenters
and
the
anti­
backsliding
concerns
they
raise
are
not
triggered,
as
nothing
in
the
SIP
is
replaced.
Our
detailed
response
to
those
comments
is
set
forth
in
Section
VII
of
this
preamble.

Retention
of
the
Section
VI
exemption,
as
limited
by
this
final
rule,
will
be
consistent
with
the
section
41
110(
a)(
2)(
C)
requirement
that
the
preconstruction
permitting
is
implemented
"
as
necessary
to
assure
that
the
[
NAAQS]
are
achieved."
It
also
is
consistent
with
the
exercise
of
our
gapfilling
authority
under
section
301,
as
informed
by
the
legislative
history.
That
is,
appendix
S
reflects
Congressional
intent
that
standards
equivalent
to
part
D
govern
the
issuance
of
NSR
permits,
subject
to
a
limited
degree
of
flexibility
under
conditions
where
attainment
of
the
NAAQS
by
the
attainment
deadline
is
assured.

The
removal
of
the
50
tpy
exemption
from
Appendix
S
is
based
on
Alabama
Power
Co.
v.
Costle,
636
F.
3d
323,
356­
57
(
D.
C.
Cir.
1980),
in
which
the
court
held
that
EPA
had
exceeded
its
authority
to
establish
the
exemption,
as
discussed
in
more
detail
in
Section
IV.
C.
4
above.

V.
Summary
of
Major
Comments
and
Responses
A.
Comments
on
§
51.165
In
today's
final
action,
we
have
revised
§
51.165
to
incorporate
the
major
stationary
source
thresholds,

significant
emission
rates,
and
offset
ratios
pursuant
to
part
D
of
title
I
of
the
1990
amendments
to
the
CAA
for
major
stationary
sources
of
ozone
precursors.
As
we
noted
in
Section
IV.
A.
1.
of
this
preamble,
the
changes
to
the
major
NSR
permitting
program
necessarily
follow.
For
a
summary
of
comments
and
responses
related
to
when
subpart
1
or
subpart
2
applies,
please
see
the
preamble
to
those
final
rules
at
69
FR
23961.
11
We
proposed
at
68
FR
32840
to
establish
NOx
waiver
provisions
identical
to
those
in
section
182(
f)
for
areas
subject
to
subpart
1.
We
intend
to
promulgate
final
rules
concerning
the
applicability
of
NOx
waivers
in
subpart
1
areas
as
part
of
our
Phase
II
Final
Rule
to
Implement
the
8­
hour
Ozone
NAAQS.
We
will
also
address
implementation
issues
related
to
NOx
waivers
under
the
1­
hour
and
8­
hour
NAAQS
in
future
rulemaking
and
guidance.

42
Commenters
on
both
the
1996
and
2003
proposals
generally
supported
applying
the
NSR
requirements
applicable
to
major
stationary
sources
of
VOC
(
including
provisions
regarding
major
modifications,
significant
emission
rates,

and
offsets)
to
nitrogen
oxide
emissions,
except
where
the
Administrator
determines
pursuant
to
182(
f)
that
net
air
quality
benefits
are
greater
in
the
absence
of
reductions
of
nitrogen
oxide
emission
reductions.
A
few
commenters
opposed
waivers
under
182(
f)
for
exemptions
from
NOx
requirements,
due
to
their
effect
on
NOx
emissions
in
downwind
States.

We
agree
with
the
commenters
supporting
NOX
as
an
ozone
precursor
for
NSR
applicability,
and
have
retained
it
in
the
final
rule.
No
determination
about
the
applicability
of
the
section
182(
f)
Nox
waiver
to
8­
hour
nonattainment
areas
is
being
made
today.
We
note
that
whether
a
NOx
waiver
applies
in
a
particular
area
and
the
effects
of
NOx
waivers
on
RACT
are
not
NSR
permitting
determinations,
and
are
thus
beyond
the
scope
of
this
rulemaking.
11
B.
Comments
on
§
52.24
We
received
comments
on
the
following
procedural
issue.
43
In
the
proposal,
we
stated
our
intent
to
issue
determinations
of
inadequate
SIP
implementation
under
section
173(
a)(
4)
by
letter,
followed
by
publication
in
the
Federal
Register,
and
explained
that
such
determinations
would
result
in
a
prohibition
on
construction
in
the
area
pursuant
to
that
provision.
(
61
FR
38305)
We
also
solicited
comment
on
whether
an
opportunity
for
public
notice
and
comment
should
be
provided.
A
few
State
commenters
believed
that
EPA
should
provide
such
notice
and
comment,
but
did
not
state
a
basis
for
their
position.

The
text
of
§
52.24(
b)
as
proposed
tracked
the
language
of
section
173(
a)(
4)
and
did
not
include
a
provision
on
the
process
to
be
used
for
issuing
a
determination
of
inadequate
SIP
implementation.
Therefore,
§
52.24(
b)
has
been
finalized
in
substantially
the
same
form
as
it
was
proposed.
The
Agency
is
still
considering
the
appropriate
process
to
use
in
issuing
a
determination
under
CAA
section
173(
a)(
4).

C.
Comments
on
Appendix
S
1.
Changes
to
Incorporate
1990
Amendments
The
comments
concerning
the
1990
Amendments
are
the
same
for
appendix
S
as
they
are
for
§
51.165,
discussed
in
Section
VII.
A.
of
this
preamble.

2.
Changes
to
Conform
to
Major
NSR
Program
As
we
noted
in
Section
III.
B.
3
of
this
preamble,
we
proposed
changes
to
appendix
S
and
the
other
major
NSR
regulations
in
1996.
Thus,
the
comments
and
responses
44
concerning
the
final
regulations
on
December
31,
2002
also
apply
to
today's
final
changes
to
appendix
S.
You
will
find
the
major
comments
and
responses
at
67
FR
80186.
For
a
complete
summary
of
the
comments
and
responses,
please
see
our
Technical
Support
Document
for
the
December
31
final
rules
at
http://
www.
epa.
gov/
ttn/
nsr/
rule_
dev.
html.

3.
Changes
to
Section
VI
We
are
not
adopting
the
Transitional
NSR
Program
as
proposed,
which
would
have
set
forth
additional
limitations
on
the
exemption
from
NSR
permitting
in
Section
VI
of
appendix
S.
However,
we
agree
with
the
many
commenters
who
supported
flexible
NSR
requirements
for
some
areas
and
maintained
that
attainment
would
not
be
in
jeopardy
due
to
such
programs.
Thus,
we
have
finalized
a
procedural
requirement
that
the
Administrator
has
determined
that
the
original
conditions
of
Section
VI
are
satisfied
and
notice
of
the
determination
is
published
in
the
Federal
Register.

Many
commenters
opposed
our
proposed
Transitional
NSR
program,
stating
that
it
would
not
be
protective
of
air
quality.
Many
other
commenters
supported
the
proposed
program,
believing
that
it
would
provide
needed
flexibility
and
would
not
interfere
with
achieving
attainment.
Many
commenters,
including
some
who
supported
the
Transitional
program,
believed
the
schedule
for
submitting
attainment
plans
and
control
requirements
was
impracticable.
Some
commenters
opposed
the
Transitional
NSR
program
on
legal
45
grounds,
arguing
that
Section
VI
does
not
authorize
any
NSR
flexibility
or
that
appendix
S
has
been
superseded
in
its
entirety
by
various
sections
of
the
Clean
Air
Act.

We
agree
with
commenters
that
the
schedule
in
the
proposal
rule
for
submitting
attainment
plans
to
be
eligible
for
Transitional
NSR
was
impracticable.
On
the
other
hand,

however,
we
do
agree
with
the
many
commenters
who
urged
us
to
provide
flexible
NSR
requirements
for
some
areas.
While
we
have
not
promulgated
specific
criteria
for
when
such
flexibility
would
apply,
we
have
promulgated
final
regulations
specifying
that
Section
VI
applies
where
the
original
conditions
are
met
(
that
is,
the
attainment
deadline
has
not
passed,
the
source
would
not
interfere
with
attainment
by
the
deadline,
and
the
source
meets
all
applicable
SIP
emissions
limitations)
and
the
Administrator
has
provided
public
notice
that
Section
VI
applies.

Regarding
the
objections
to
our
legal
authority
to
implement
flexible
NSR
under
appendix
S,
some
commenters
argued
that
the
Section
VI
exemption
is
applicable
only
where
an
attainment
date
for
the
secondary
standards
has
not
yet
passed.
However,
this
comment
ignores
the
plain
language
of
Section
VI,
which
references
primary
standards.

It
states:
"
In
some
cases,
the
dates
for
attainment
of
primary
standards
have
not
yet
passed
due
to
the
delay
in
the
promulgation
of
a
plan
under
this
section
of
the
Act."

It
then
goes
on
to
note
that
the
attainment
deadlines
for
12
Designations
are
in
40
CFR
81.300.
This
citation
has
been
corrected
in
today's
final
rules.

46
the
secondary
standards
may
also
not
yet
have
passed.
It
then
states:
"
In
such
cases
[
a
reference
to
attainment
dates
that
have
not
passed
for
both
primary
and
second
standards],

a
new
source
locating
in
an
area
designated
in
40
CFR
81.3000
et
seq.
as
nonattainment
may
be
exempt
from
the
conditions
of
Section
IV.
A"
12
where
certain
requirements
are
met.
Thus,
the
Section
VI
exemption
is
applicable
where
the
attainment
date
for
the
primary
standard
has
not
passed.

Other
commenters
argued
that
appendix
S
and
40
CFR
52.24(
k)
have
been
superseded
by
or
prohibited
by
various
sections
of
the
Act.
(
EPA
will
use
the
term
"
appendix
S"
in
this
section
of
the
preamble
to
refer
to
these
collectively.)
Although
commenters
made
this
argument
in
the
context
of
opposing
the
proposed
revisions
to
Section
VI
of
appendix
S,
this
comment
applies
to
any
use
of
appendix
S
for
permitting,
including
the
LAER
and
offset
requirements
of
Section
IV,
and
the
existing
version
of
Section
VI.

First,
the
commenter
contended
that
appendix
S
has
been
superseded
by
section
181(
b)(
1)
within
subpart
2
of
the
Act,

under
which
it
believes
a
newly
designated
nonattainment
area
receives
its
nonattainment
classification
by
operation
of
law
and
immediately
becomes
subject
to
all
of
the
requirements
­­
including
section
110,
subpart
1,
and
subpart
2
­­
that
apply
to
that
classification.
EPA
47
disagrees
with
the
commenter.
As
a
threshold
matter,
even
if
the
commenter
were
correct
that
both
subpart
1
and
subpart
2
applied
upon
an
area's
nonattainment
classification,
subpart
1
itself
provides
in
section
172(
b)

that
the
area
may
have
up
to
"
three
years
from
the
date
of
the
nonattainment
designation
for
the
submission
of
a
plan
or
plan
revision
.
.
.
meeting
the
applicable
requirements
of
subsection
(
c)
[
the
section
173
major
NSR
permitting
provision]
and
section
110(
a)(
2)."
For
the
SIP
development
period,
part
D
leaves
a
gap
as
to
the
NSR
requirements
applicable
to
the
newly
designated
nonattainment
area
(
if
the
State's
part
D
NSR
SIP
does
not
automatically
cover
the
area).
This
gap
exists
even
if
EPA
were
to
accept
the
commenter's
contention
that
subpart
2
applies.
Pursuant
to
40
CFR
52.24(
k),
this
gap
is
filled
by
appendix
S,
which
requires
NSR
permitting
that
mirrors
part
D,
subject
to
the
Section
VI
exemption.

Additionally,
EPA
disagrees
with
the
commenter's
contention
that
subpart
2
must
apply
to
all
newly
designated
nonattainment
areas.
As
discussed
in
more
detail
in
the
preamble
to
the
8­
hour
ozone
implementation
rule
(
69
FR
23951),
EPA
has
determined
that
it
has
discretion
in
determining
whether
subpart
2
applies
to
these
areas
because
subpart
2
does
not
dictate
whether
it
applies
where
the
1­

hour
design
value
falls
below
the
lowest
value
in
the
subpart
2
classification
table.
EPA
has
described
in
that
13
Although
EPA
did
state
in
the
proposal
that
States
with
already
applicable
part
D
NSR
SIPs
may
choose
to
amend
their
SIPs
to
allow
them
to
take
advantage
of
the
proposed
revisions
to
Section
VI
(
68
FR
32844
n.
67),
the
decision
not
to
go
forward
with
the
Section
VI
revisions
as
proposed
makes
that
issue
moot.
NSR
under
Section
VI,
as
finalized,
will
involve
notification
by
the
Administrator
that
it
applies
for
new
sources
meeting
the
Section
VI
criteria,
rather
than
replacement
of
an
NSR
program
in
the
SIP
with
the
Transitional
NSR
program.
Additionally,
the
existing
Section
VI
exemption
criteria
require
that
the
source
meet
the
applicable
SIP
emissions
limitations
 
rather
than
be
excused
from
them
 
so
the
section
193
concern
raised
by
the
commenter
is
unlikely
to
arise.

48
rule
the
circumstances
in
which
subpart
2
applies.

The
commenter
also
contends
that
section
193
has
superseded
appendix
S.
EPA
disagrees.
The
commenter
relies
on
the
following
language
in
section
193:
"
No
control
requirement
in
effect,
or
required
to
be
adopted
by
a[]
.
.

.
[
implementation]
plan
in
effect
before
November
15,
1990,

in
any
area
which
is
a
nonattainment
area
for
any
air
pollutant
may
be
modified
after
November
15,
1990,
in
any
manner
unless
the
modification
insures
equivalent
or
greater
emission
reductions
of
such
air
pollutant."
However,
this
part
of
section
193
is
of
no
relevance
to
appendix
S
because
appendix
S
does
not
replace
any
existing
SIP
requirements.

An
area
is
only
required
to
apply
appendix
S
where
it
does
not
have
a
part
D
NSR
SIP
covering
permitting
for
the
8­
hour
standard.
In
other
words,
it
covers
only
the
gap
in
the
SIP
caused
by
the
lack
of
a
part
D
NSR
program
for
the
relevant
NAAQS,
and
is
supplemental
to
any
existing
SIP
requirements.
13
49
The
commenter
also
believes
that
use
of
appendix
S
for
permitting
would
violate
section
110(
l),
which
provides,
in
relevant
part,
that:
"
The
Administrator
shall
not
approve
a
revision
of
a
plan
if
the
revision
would
interfere
with
any
applicable
requirement
concerning
attainment
and
reasonable
further
progress
.
.
."
The
commenter
states
that
nonattainment
preconstruction
permitting
requirements
"
concern[]
attainment
and
reasonable
further
progress,"
so
if
a
SIP
is
already
written
such
that
nonattainment
NSR
will
apply
in
an
area
as
soon
as
it
is
designated
nonattainment
under
the
8­
hour
standard,
then
any
revision
that
would
thwart
the
automatic
effectiveness
of
those
requirements
would
violate
section
110(
l).
Again,
appendix
S
is
not
an
amendment
to
a
SIP,
and
does
not
replace
any
existing
SIP
requirements.
Rather,
it
covers
the
gap
caused
by
the
lack
of
a
part
D
NSR
SIP
for
the
newly
designated
nonattainment
area.
If
a
SIP
is
already
written
such
that
nonattainment
NSR
will
apply
to
an
area
as
soon
as
it
is
designated
nonattainment,
appendix
S
does
not
apply
to
that
area.
[
See
40
CFR
52.24(
k)
and
appendix
S,
Section
I.]
For
these
same
reasons,
the
commenter
is
incorrect
that
NSR
permitting
under
appendix
S
violates
Congressional
intent
not
to
relax
pollution
control
requirements
when
the
NAAQS
are
revised,

as
expressed
in
section
172(
e).

4.
Notice
and
Comment
One
commenter
stated
that
any
major
revisions
to
50
appendix
S
should
be
subject
to
additional
notice
and
comment
because
such
revisions
could
not
be
a
logical
outgrowth
of
the
June
2,
2003
proposal.
We
disagree
that
the
public
lacked
adequate
notice
and
comment.
The
changes
to
incorporate
the
1990
Amendments
to
part
D
of
title
I
of
the
Act
(
for
example,
major
stationary
source
thresholds,

significant
emission
rates,
and
offset
ratios)
were
proposed
in
1996
for
the
major
NSR
program,
including
appendix
S.

(
61
FR
38252)
The
method
for
making
designations
and
classifications
specific
to
the
8­
hour
standard
was
proposed
on
June
2,
2003
(
68
FR
32802).
The
changes
to
the
NSR
program
finalized
on
December
31,
2002
were
also
proposed
in
1996
for
the
entire
major
NSR
program,
including
appendix
S.

(
Id;
67
FR
80187)
We
also
provided
an
opportunity
to
comment
on
incorporation
of
those
NSR
program
changes
into
appendix
S
through
a
Federal
Register
notice
published
on
August
6,
2003
(
68
FR
46536),
regarding
the
8­
hour
ozone
implementation
rule.
Although
rule
language
was
not
proposed
specifically
for
appendix
S,
the
rule
language
could
be
discerned
from
the
rule
language
proposed
for
§
51.165,
as
appendix
S
states
it
is
an
interpretation
of
40
CFR
subpart
I,
which
includes
§
51.165.
Additionally,
the
Act
does
not
require
that
the
Agency
provide
notice
of
the
exact
rule
language
that
will
be
finalized,
but
rather
that
the
Agency
provide
a
statement
of
basis,
including,
among
other
things,
the
major
legal
interpretations
and
policy
51
considerations
underlying
the
proposal.
These
were
provided
by
the
1996
proposal
and,
in
the
case
of
the
removal
of
the
50
tpy
exemption,
in
the
1979
proposal.

With
regard
to
the
changes
to
Section
VI
of
appendix
S,

the
Agency
notes
that
because
it
declined
to
adopt
the
extensive
revisions
proposed,
the
changes
are
minimal.
The
additional
condition
regarding
approval
by
the
Administrator
is
a
logical
outgrowth
of
the
proposed
revisions
to
Section
VI,
which
explained
that
the
Agency's
goal
was
to
limit
the
applicability
of
Section
VI
to
situations
where
the
new
source
would
comply
with
all
of
the
conditions
in
Section
VI,
most
notably,
not
interfering
with
an
area's
ability
to
meet
its
attainment
deadline.

VI.
NSR
Implementation
As
promulgated
at
69
FR
23858,
the
designation
and
classifications
for
the
8­
hour
NAAQS
are
effective
June
15,

2004.
The
transition
to
NSR
under
the
8­
hour
NAAQS
raises
multiple
implementation
questions.
We
intend
to
address
many
of
these
issues
in
the
Phase
II
Ozone
Implementation
final
rule,
which
we
expect
to
promulgate
within
the
next
several
months.
As
part
of
today's
final
action,
however,

we
are
providing
additional
detail
concerning
some
aspects
of
implementing
NSR
under
the
8­
hour
NAAQS
that
were
included
in
the
Phase
I
final
rule
at
69
FR
23951.

A.
Areas
That
Have
Never
Been
Nonattainment
for
Ozone
If
an
area
has
never
been
nonattainment
for
ozone
and
52
is
nonattainment
for
the
8­
hour
ozone
NAAQS,
it
will
be
subject
to
nonattainment
NSR
under
the
8­
hour
standard
on
June
15,
2004.
Permits
for
new
or
modified
major
stationary
sources
in
such
areas
issued
on
or
after
June
15,
2004
must
reflect
NSR
requirements
under
the
8­
hour
ozone
NAAQS.
Some
States
may
already
have
in
place
a
part
D
major
source
permitting
program
applicable
to
newly
designated
8­
hour
ozone
nonattainment
areas.
For
nonattainment
areas
in
States
whose
SIPs
contain
a
generic
requirement
to
issue
part
D
major
source
NSR
permits
in
areas
designated
as
nonattainment,
the
State
can
continue
to
issue
nonattainment
NSR
permits
for
new
and
modified
major
stationary
sources
under
the
part
D
NSR
SIP
on
or
after
June
15,
2004.
For
a
nonattainment
area
in
a
State
with
a
SIP
that
specifically
lists
the
areas
in
which
part
D
NSR
applies,
or
in
an
area
that
currently
has
no
nonattainment
plan
or
otherwise
lacks
authority
to
implement
NSR
for
8­
hour
ozone
NAAQS
through
a
SIP­
approved
permitting
program,
there
will
be
an
interim
period
between
June
15,
2004
and
the
date
that
the
State
amends
its
SIP
either
to
list
any
new
nonattainment
area(
s)

or
to
include
a
part
D
plan.
During
this
interim
period,

pursuant
to
§
52.24(
k),
permits
for
new
and
modified
major
stationary
sources
in
such
areas
must
be
consistent
with
the
requirements
in
appendix
S.
Where
a
State
or
local
agency
lacks
authority
to
issue
permits
consistent
with
appendix
S,

EPA
is
the
reviewing
authority.
53
B.
Areas
That
Are
Nonattainment
for
the
1­
hr
Standard
and
Are
Nonattainment
for
the
8­
hour
Standard.

Pursuant
to
40
CFR
50.9(
b),
the
1­
hr
NAAQS
will
be
revoked
effective
one
year
after
the
effective
date
of
the
8­
hour
NAAQS.
That
is,
the
1­
hr
NAAQS
will
be
revoked
effective
June
15,
2005.
NSR
under
the
8­
hr
NAAQS
applies
effective
June
15,
2004.
Thus,
there
will
be
a
period
of
time
when
NSR
requirements
under
the
1­
hour
and
8­
hour
NAAQS
overlap.
Permits
issued
on
or
after
June
15,
2004
but
before
June
14,
2005
must
be
issued
according
to
the
higher
classification
that
applies
to
the
area.
If
the
area's
1­

hour
classification
is
higher
than
its
8­
hour
classification,
the
NSR
SIP
program
under
the
1­
hour
NAAQS
will
satisfy
the
requirements
of
both
programs.
If
the
8­

hour
classification
is
higher,
then
the
NSR
program
under
the
8­
hour
classification
will
determine
the
contents
of
the
permit.
This
is
because
where
NSR
requirements
overlaphere
NSR
under
the
1­
hour
and
8­
hour
NAAQS­
the
more
stringent
applicable
requirement
is
determinative
of
the
contents
of
the
permit.

Upon
revocation
of
the
1­
hour
ozone
NAAQS,
for
any
area
that
was
designated
nonattainment
for
the
1­
hour
ozone
NAAQS,
the
area's
implementation
plan
provisions
satisfying
sections
172(
c)(
5)
and
173
(
including
provisions
satisfying
section
182)
based
on
the
area's
previous
1­
hour
ozone
NAAQS
classification
are
no
longer
required
elements
of
an
54
approvable
implementation
plan.
Accordingly,
a
State
may
request
approval
of
a
SIP
revision
to
remove
its
1­
hour
nonattainment
NSR
program
from
its
SIP.
States
with
an
NSR
program
generically
applicable
to
all
nonattainment
areas
may
find
it
unnecessary
to
revise
their
SIPs
to
effectuate
such
a
change
because
the
1­
hour
nonattainment
classification
will
no
longer
be
in
effect.
In
States
where
such
a
change
is
necessary,
however,
the
1­
hour
NSR
program
applies
until
the
SIP
revision
is
approved.
The
revised
implementation
plan
must
include
requirements
to
implement
the
provisions
of
sections
172(
c)(
5)
and
173
of
the
Act
based
on
the
area's
8­
hour
ozone
NAAQS
classification
under
40
CFR
part
81,
and
the
provisions
of
§
51.165
as
amended
in
today's
final
action.

On
or
after
June
15,
2005,
permits
will
be
issued
either
under
the
part
D
NSR
SIP
or
appendix
S,
whichever
is
applicable
in
the
nonattainment
area
in
which
the
source
is
located.
In
some
cases
NSR
under
both
the
1­
hour
and
the
8­

hour
NAAQS
will
apply
because
the
State
has
not
obtained
approval
to
remove
its
1­
hour
NSR
program.
In
such
cases,

permits
issued
must
be
issued
according
to
the
higher
classification
that
applies
to
the
area.

C.
Part
D
NSR
SIP
Submittals
Today's
final
action
on
the
regulations
at
§
51.165
applies
for
part
D
SIPs
implementing
NSR
under
the
8­
hour
NAAQS.
SIP
provisions
incorporating
today's
final
rules
at
14
John
S.
Seitz,
"
New
Source
review
(
NSR)
program
Transistional
Guidance,"
March
11,
1991.

55
§
51.165
may
be
submitted
as
part
of
the
part
D
SIP
submittal
to
implement
the
8­
hour
NAAQS.
State
and
local
agencies
should
assure
that
any
program
changes
under
§
51.165
are
consistently
accounted
for
in
other
SIP
planning
measures.

Implementation
of
major
NSR
under
the
1­
hour
and
8­
hour
ozone
NAAQS
is
different
because
different
major
stationary
source
thresholds
and
offset
ratios
of
CAA
section
182
may
apply,
depending
on
a
change
in
classification.
Part
D
NSR
SIPs
under
§
51.165
to
implement
NSR
under
the
1­
hour
NAAQS
were
prepared
according
to
our
1991
Transition
Policy
Memo.
14
VII.
Effective
Date
for
Today's
Requirements
All
of
these
changes
will
take
effect
in
the
NSR
permitting
programs
for
nonattainment
areas
codified
at
appendix
S
of
part
51
and
§
52.24
on
June
15,
2004.
This
means
that
appendix
S
as
amended
in
today's
final
action
will
apply
on
June
15,
2004
in
any
nonattainment
area
without
an
approved
part
D
NSR
SIP
that
applies
to
major
sources
in
the
nonattainment
area
for
the
nonattainment
pollutant.
The
provisions
of
§
51.165
and
§
52.24,
as
amended
in
today's
final
action,
also
apply
on
June
15,
2004.

To
be
approvable
under
the
SIP,
State
and
local
agency
programs
implementing
part
D
(
nonattainment
NSR
permit
program
in
§
51.165)
must
include
today's
changes
as
minimum
56
program
elements.
State
and
local
agencies
should
assure
that
any
program
changes
under
§
51.165
are
consistently
accounted
for
in
other
SIP
planning
measures.
State
and
local
agencies
must
adopt
and
submit
revisions
to
their
part
51
permitting
programs
implementing
these
minimum
program
elements
as
part
of
the
SIP
submittal
for
implementing
the
8­
hour
NAAQS.
We
will
address
the
schedule
for
SIP
submittals
for
the
8­
hour
ozone
NAAQS
as
part
of
the
Phase
II
implementation
rule
for
the
8­
hour
ozone
NAAQS.

VIII.
Statutory
and
Executive
Order
Reviews
A.
Executive
Order
12866
­
Regulatory
Planning
and
Review
Under
Executive
Order
12866
[
58
Federal
Register
51,735
(
October
4,
1993)],
we
must
determine
whether
the
regulatory
action
is
"
significant"
and
therefore
subject
to
review
by
the
Office
of
Management
and
Budget
(
OMB)
and
the
requirements
of
the
Executive
Order.
The
Executive
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
57
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.

Pursuant
to
the
terms
of
Executive
Order
12866,
OMB
has
notified
us
that
it
considers
this
a
"
significant
regulatory
action"
within
the
meaning
of
the
Executive
Order.
We
have
submitted
this
action
to
OMB
for
review.
Changes
made
in
response
to
OMB
suggestions
or
recommendations
will
be
documented
in
the
public
record.
All
written
comments
from
OMB
to
EPA
and
any
written
EPA
response
to
any
of
those
comments
are
included
in
the
docket
listed
at
the
beginning
of
this
notice
under
ADDRESSES.
In
addition,
consistent
with
Executive
Order
12866,
we
consulted
with
the
State,

local
and
tribal
agencies
that
will
be
affected
by
this
rule.
We
have
also
sought
involvement
from
industry
and
public
interest
groups.

B.
Paperwork
Reduction
Act
The
information
collection
requirements
in
this
rule
are
contained
in
three
different
Information
Collection
Requests
(
ICRs).

ICR
1230.11
covers
this
rulemaking
to
the
extent
that
it
incorporates
the
final
regulations
of
December
31,
2002
for
sources
in
nonattainment
areas
under
appendix
S.
The
information
collection
requirements
in
that
final
rule
were
58
submitted
for
approval
to
OMB
under
the
requirements
of
the
Paperwork
Reduction
Act,
44
U.
S.
C.
3501
et
seq.
An
ICR
document
has
been
prepared
by
EPA
(
ICR
No.
1230.11),
and
a
copy
may
be
obtained
from
Susan
Auby,
U.
S.
Environmental
Protection
Agency,
Office
of
Environmental
Information,

Collection
Strategies
Division
(
2822T),
1200
Pennsylvania
Avenue,
NW,
Washington,
DC
20460­
0001,
by
e­
mail
at
auby.
susan@
epa.
gov,
or
by
calling
(
202)
566­
1672.
A
copy
may
also
be
downloaded
off
the
internet
at
http://
www.
epa.
gov/
icr.
The
information
requirements
included
in
ICR
No.
1230.11
were
effective
on
INSERT
DATE.

To
the
extent
that
this
rulemaking
incorporates
the
major
stationary
source
thresholds
and
offset
ratios
of
the
1990
CAA
in
§
51.165,
the
burden
was
covered
under
ICR
1230.08.
(
Prevention
of
Significant
Deterioration
and
Nonattainment
Area
Source
Review,
covering
1995
through
1997)
State
and
local
agencies
were
required
to
make
these
changes
as
part
of
their
SIP
submittals
due
November
15,

1992
(
57
FR
13499),
which
were
covered
under
ICR
1230.08.

The
EPA
prepared
an
ICR
document
(
ICR
No.
1230.10)

extending
the
approval
of
the
ICR
for
the
promulgated
NSR
regulations
on
March
30,
2001.
On
October
29,
2001,
OMB
approved
EPA's
request
for
extension
for
3
years
until
October
31,
2004.
The
OMB
number
for
this
approval
is
2060­

0003.
To
the
extent
that
other
changes
are
required
to
State
and
local
agency
regulations
under
§
51.165,
these
must
59
be
submitted
as
part
of
the
larger
SIP
revision
required
for
implementing
the
8­
hour
ozone
NAAQS.
We
anticipate
minimal
increase
in
burden
to
incorporate
theses
changes
in
§
51.165,

and
this
burden
will
be
covered
under
ICR
1230.17,
which
is
the
renewal
ICR
for
the
NSR
base
program
covered
under
ICR
1230.10.

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
purpose
of
responding
to
the
information
collection;
adjust
existing
ways
to
comply
with
any
previously
applicable
instructions
and
requirements;

train
personnel
to
respond
to
a
collection
of
information;

search
existing
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
are
listed
in
40
CFR
part
9
and
48
CFR
chapter
15.
We
will
continue
to
present
OMB
control
numbers
in
a
consolidated
table
format
to
be
codified
in
40
CFR
part
9
of
the
Agency's
regulations,

and
in
each
CFR
volume
containing
EPA
regulations.
The
60
table
lists
the
section
numbers
with
reporting
and
recordkeeping
requirements,
and
the
current
OMB
control
numbers.
This
listing
of
the
OMB
control
numbers
and
their
subsequent
codification
in
the
CFR
satisfy
the
requirements
of
the
Paperwork
Reduction
Act
(
44
U.
S.
C.
3501
et
seq.)
and
OMB's
implementing
regulations
at
5
CFR
part
1320.

C.
Regulatory
Flexibility
Analysis
We
determined
it
is
not
necessary
to
prepare
a
regulatory
flexibility
analysis
in
connection
with
this
final
rule.
We
have
also
determined
that
this
rule
will
not
have
a
significant
economic
impact
on
a
substantial
number
of
small
entities.
For
purposes
of
assessing
the
impacts
of
today's
rule
on
small
entities,
small
entity
is
defined
as:

(
1)
any
small
business
employing
fewer
than
500
employees;

(
2)
a
small
governmental
jurisdiction
that
is
a
government
of
a
city,
county,
town,
school
district
or
special
district
with
a
population
of
less
than
50,000;
and
(
3)
a
small
organization
that
is
any
not­
for­
profit
enterprise
which
is
independently
owned
and
operated
and
is
not
dominant
in
its
field.

After
considering
the
economic
impacts
of
today's
rule
on
small
entities,
EPA
has
concluded
that
this
action
will
not
have
a
significant
economic
impact
on
a
substantial
number
of
small
entities.
In
determining
whether
a
rule
has
a
significant
economic
impact
on
a
substantial
number
of
small
entities,
the
impact
of
concern
is
any
significant
61
adverse
economic
impact
on
small
entities,
since
the
primary
purpose
of
the
regulatory
flexibility
analyses
is
to
identify
and
address
regulatory
alternatives
"
which
minimize
any
significant
economic
impact
of
this
rule
on
small
entities."
5
U.
S.
C.
Sections
603
and
604.
Thus,
an
agency
may
conclude
that
a
rule
will
not
have
a
significant
economic
impact
on
a
substantial
number
of
small
entities
if
the
rule
relieves
regulatory
burden,
or
otherwise
has
a
positive
economic
effect
on
all
of
the
small
entities
subject
to
the
rule.

A
Regulatory
Flexibility
Act
Screening
Analysis
(
RFASA,)
developed
as
part
of
a
1994
draft
Regulatory
Impact
Analysis
(
RIA)
and
incorporated
into
the
September
1995
ICR
renewal
analysis
showed
that
the
changes
to
the
NSR
program
due
to
the
1990
CAA
Amendments
would
not
have
an
adverse
impact
on
small
entities.
This
analysis
encompassed
the
entire
universe
of
applicable
major
sources
that
were
likely
to
also
be
small
businesses
(
approximately
50
"
small
business"
major
sources).
Because
the
administrative
burden
of
the
NSR
program
is
the
primary
source
of
the
NSR
program's
regulatory
costs,
the
analysis
estimated
a
negligible
"
cost
to
sales"
(
regulatory
cost
divided
by
the
business
category
mean
revenue)
ratio
for
this
source
group.

The
incorporation
of
the
major
source
thresholds
and
offset
ratios
from
the
CAA
1990
Amendments
in
§
51.165
and
Appendix
S
for
the
purpose
of
implementing
NSR
for
the
8­
hour
62
standard
does
not
change
this
conclusion.
Under
Section
110(
a)(
2)(
C),
all
States
must
implement
a
preconstruction
permitting
program
"
as
necessary
to
assure
that
the
[
NAAQS]

are
achieved,"
regardless
of
changes
to
today's
regulations.

Thus,
small
businesses
continue
to
be
subject
to
regulations
for
construction
and
modification
of
stationary
sources,

whether
under
State
and
local
agency
minor
NSR
programs,

SIPs
to
implement
§
51.165,
or
appendix
S,
to
ensure
that
the
8­
hour
standard
is
achieved.

Additionally,
the
incorporation
of
the
final
regulations
of
December
31,
2002,
into
Appendix
S
will
reduce
the
regulatory
burden
associated
with
the
major
NSR
program
for
all
sources,
including
all
small
businesses,
by
improving
operational
flexibility
of
owners
and
operators,

improving
the
clarity
of
requirements,
and
providing
alternatives
that
sources
may
take
advantage
of
to
further
improve
their
operational
flexibility.
As
a
result,
the
program
changes
provided
in
the
final
rule
are
not
expected
to
result
in
any
increases
in
expenditure
by
any
small
entity.
We
have
therefore
concluded
that
today's
rule
will
not
have
a
significant
economic
impact
on
a
substantial
number
of
small
entities.

D.
Unfunded
Mandates
Reform
Act
of
1995
Title
II
of
the
Unfunded
Mandates
Reform
Act
of
1995
(
UMRA),
Public
Law
104­
4,
establishes
requirements
for
Federal
agencies
to
assess
the
effects
of
their
regulatory
63
actions
on
State,
local,
and
tribal
governments
and
the
private
sector.
Under
section
202
of
UMRA,
we
generally
must
prepare
a
written
statement,
including
a
cost­
benefit
analysis,
for
proposed
and
final
rules
with
"
Federal
mandates"
that
may
result
in
expenditures
to
State,
local,

and
tribal
governments,
in
the
aggregate,
or
to
the
private
sector
of
$
100
million
or
more
in
any
one
year.
Before
promulgating
an
EPA
rule
for
which
a
written
statement
is
needed,
section
205
of
the
UMRA
generally
requires
us
to
identify
and
consider
a
reasonable
number
of
regulatory
alternatives
and
adopt
the
least
costly,
most
cost­
effective
or
least
burdensome
alternative
that
achieves
the
objectives
of
the
rule.
The
provisions
of
section
205
do
not
apply
when
they
are
inconsistent
with
applicable
law.
Moreover,

section
205
allows
us
to
adopt
an
alternative
other
than
the
least
costly,
most
cost­
effective,
or
least
burdensome
alternative
if
the
Administrator
publishes
with
the
final
rule
an
explanation
why
that
alternative
was
not
adopted.

Before
we
establish
any
regulatory
requirements
that
may
significantly
or
uniquely
affect
small
governments,

including
tribal
governments,
we
must
have
developed
under
section
203
of
the
UMRA
a
small
government
agency
plan.
The
plan
must
provide
for
notifying
potentially
affected
small
governments,
enabling
officials
of
affected
small
governments
to
have
meaningful
and
timely
input
in
the
development
of
our
regulatory
proposals
with
significant
64
Federal
intergovernmental
mandates,
and
informing,

educating,
and
advising
small
governments
on
compliance
with
the
regulatory
requirements.

To
the
extent
that
this
final
rule
incorporates
the
December
31,
2002
final
rules
into
appendix
S,
we
believe
these
rule
changes
will
actually
reduce
the
regulatory
burden
associated
with
the
major
NSR
program
by
improving
the
operational
flexibility
of
owners
or
operators
and
clarifying
the
requirements.
To
the
extent
that
this
final
rule
incorporates
requirements
of
the
1990
CAA
into
§
51.165
and
appendix
S,
we
believe
regulatory
burden
associated
with
the
SIP
submittals
for
State
and
local
governments
will
be
minimal,
because
these
changes
have
already
been
incorporated
into
the
SIP
or
will
be
a
small
part
of
the
larger
SIP
submittal
required
for
implementing
the
8­
hour
ozone
NAAQS.
Additionally,
States
are
not
required
to
revise
their
SIPs
with
respect
to
appendix
S.
EPA
will
act
as
the
reviewing
authority
where
the
State
lacks
authority
to
issue
permits
that
meet
the
conditions
of
appendix
S.

Because
the
program
changes
provided
in
the
rule
are
not
expected
to
result
in
a
significant
increase
in
the
expenditure
by
State,
local,
and
tribal
governments,
or
the
private
sector,
we
have
not
prepared
a
budgetary
impact
statement
or
specifically
addressed
the
selection
of
the
least
costly,
most
cost­
effective,
or
least
burdensome
alternative.
Because
small
governments
will
not
be
65
significantly
or
uniquely
affected
by
this
rule,
we
are
not
required
to
develop
a
plan
with
regard
to
small
governments.

Therefore,
this
rule
is
not
subject
to
the
requirements
of
section
203
of
the
UMRA.

E.
Executive
Order
13132
­
Federalism
Executive
Order
13132,
entitled
"
Federalism"
(
64
FR
43255,
August
10,
1999),
requires
us
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"
are
defined
in
the
Executive
Order
to
include
regulations
that
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."

This
final
rule
does
not
have
federalism
implications.

Nevertheless,
as
described
in
Section
III.
B
and
C
of
this
notice,
in
developing
this
rule,
we
consulted
with
affected
parties
and
interested
stakeholders,
including
State
and
local
authorities,
to
enable
them
to
provide
timely
input
in
the
development
of
this
rule.
This
rule
will
not
have
substantial
direct
effects
on
the
States,
on
the
relationship
between
the
national
government
and
the
State
and
local
programs,
or
on
the
distribution
of
power
and
responsibilities
among
the
various
levels
of
government,
as
66
specified
in
Executive
Order
13132.
The
only
revisions
in
this
rulemaking
directly
affecting
State
and
local
agencies
are
those
in
§
51.165.
State
and
local
agencies
were
required
to
make
most
of
these
changes
as
part
of
their
SIP
submittals
due
November
15,
1992.
(
57
FR
13499)
To
the
extent
that
a
State
or
local
agency
has
not
already
made
these
changes,
they
must
be
submitted
as
part
of
the
larger
SIP
revision
required
for
implementing
the
8­
hour
ozone
NAAQS.
As
State
and
local
agencies
have
to
make
a
SIP
submittal
under
the
ozone
rules
regardless
of
today's
final
rule
and
most
of
the
changes
in
§
51.165
have
already
been
made
as
part
of
the
1992
submittal,
we
anticipate
minimal
increase
in
burden
to
incorporate
the
changes
in
§
51.165.

The
revisions
to
appendix
S
also
do
not
have
substantial
direct
effects
on
State
and
local
agencies
because
State
and
local
agencies
are
not
required
to
revise
their
programs
with
respect
to
appendix
S.
EPA
will
act
as
the
reviewing
authority
where
the
State
lacks
authority
to
issue
permits
that
meet
the
conditions
of
appendix
S.
Moreover,
this
revision
provides
sources
permitted
by
States
under
appendix
S
greater
certainty
in
application
of
the
program,
which
should
in
turn
reduce
the
overall
burden
of
the
program
on
State
and
local
authorities.
Thus,
the
requirements
of
Executive
Order
13132
do
not
apply
to
this
rule.

F.
Executive
Order
13175
­
Consultation
and
Coordination
with
Indian
Tribal
Governments
67
Executive
Order
13175,
entitled
"
Consultation
and
Coordination
with
Indian
Tribal
Governments"
(
65
FR
67249,

November
6,
2000),
requires
EPA
to
develop
an
accountable
process
to
ensure
"
meaningful
and
timely
input
by
tribal
officials
in
the
development
of
regulatory
policies
that
have
tribal
implications."
We
believe
that
this
rule
does
not
have
tribal
implications
as
specified
in
Executive
Order
13175.
Thus,
Executive
Order
13175
does
not
apply.

There
are
two
purposes
for
today's
final
rule.
The
first
purpose,
like
that
for
the
December
31,
2002
rules,
is
to
add
greater
flexibility
to
the
existing
major
NSR
regulations.
These
changes
have
been
incorporated
into
appendix
S.
Appendix
S
affects
sources
located
in
Indian
country,
but
has
no
direct
effect
on
Indian
tribes.

Although
major
stationary
sources
affected
by
today's
final
rule
could
be
located
in
or
near
Indian
country
and/
or
be
owned
or
operated
by
tribal
governments,
such
sources
would
not
incur
additional
costs
or
compliance
burdens
as
a
result
of
this
rule.
Instead,
the
only
effect
on
such
sources
should
be
the
benefit
of
the
added
certainty
and
flexibility
provided
by
the
rule.

The
second
purpose
of
today's
final
rule
is
to
incorporate
changes
to
implement
the
provisions
of
the
1990
Amendments,
including
those
related
to
ozone,
through
changes
in
the
regulations
related
to
SIPs
under
§
51.165
and
appendix
S.
No
tribal
government
currently
has
an
approved
68
tribal
implementation
plan
(
TIP)
under
the
CAA
to
implement
the
NSR
program.
The
Federal
government
is
currently
the
NSR
reviewing
authority
in
Indian
country,
thus
tribal
governments
should
not
experience
added
burden,
nor
should
their
laws
be
affected
with
respect
to
implementation
of
this
rule.

Although
Executive
Order
13175
does
not
apply
to
this
rule,
EPA
afforded
Tribal
officials
the
opportunity
to
comment
on
the
December
31,
2002
final
rules,
which
were
developed
largely
prior
to
issuance
of
Executive
Order
13175.
Two
tribes
submitted
comments
on
that
action.
EPA
did
consult
with
Tribal
officials
in
developing
the
8­
hour
ozone
NAAQS
implementation
rule
and
encourage
Tribal
input
at
an
early
stage.
As
part
of
this
regulatory
development
process,
EPA
supported
a
national
"
Tribal
Designations
and
Implementation
work
Group,"
which
provided
an
open
forum
for
all
Tribes.
EPA
also
send
individualized
letters
to
all
federally
recognized
Tribes
and
gave
them
opportunity
for
comment.
The
National
Tribal
Air
Association
provided
comments
on
the
8­
hour
ozone
NAAQS
implementation
rule,

which
were
addressed
in
the
technical
support
document
for
that
rulemaking.

We
recognize
the
importance
of
including
tribal
consultation
as
part
of
the
rulemaking
process.
We
will
continue
to
consult
with
tribes
on
future
rulemaking
to
assess
and
address
tribal
implications,
and
will
work
with
69
tribes
interested
in
seeking
TIP
approval
to
implement
the
NSR
program
to
ensure
consistency
of
tribal
plans
with
this
rule.

G.
Executive
Order
13045
­
Protection
of
Children
from
Environmental
Health
Risks
and
Safety
Risks
Executive
Order
13045,
"
Protection
of
Children
from
Environmental
Health
Risks
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,
we
must
evaluate
the
environmental
health
or
safety
effects
of
the
planned
rule
on
children
and
explain
why
the
planned
regulation
is
preferable
to
other
potentially
effective
and
reasonable
alternatives
that
we
considered.

This
rule
is
not
subject
to
Executive
Order
13045,

because
we
do
not
have
reason
to
believe
the
environmental
health
or
safety
risks
addressed
by
this
action
present
a
disproportionate
risk
to
children.
Based
on
our
Supplemental
Analysis,
we
believe
that
the
December
31,
2002
rules
that
have
been
incorporated
into
today's
final
action
will
result
in
equal
or
better
environmental
protection
than
currently
provided
by
the
prior
regulations,
and
do
so
in
a
more
streamlined
and
effective
manner.
Today's
requirements
70
implementing
the
1990
amendments
will
also
result
in
better
protection.

H.
Executive
Order
13211
­
Actions
Concerning
Regulations
That
Significantly
Affect
Energy
Supply,
Distribution,
or
Use
This
rule
is
not
a
"
significant
energy
action"
as
defined
in
Executive
Order
13211,
"
Actions
Concerning
Regulations
That
Significantly
Affect
Energy
Supply,

Distribution,
or
Use"
(
66
FR
28355
(
May
22,
2001))
because
it
is
not
likely
to
have
a
significant
adverse
effect
on
the
supply,
distribution
or
use
of
energy.

Today's
rule
improves
the
ability
of
sources
to
undertake
pollution
prevention
or
energy
efficiency
projects,
switch
to
less
polluting
fuels
or
raw
materials,
maintain
the
reliability
of
production
facilities,
and
effectively
utilize
and
improve
existing
capacity.
The
rule
also
includes
a
number
of
provisions
to
streamline
administrative
and
permitting
processes
so
that
facilities
can
quickly
accommodate
changes
in
supply
and
demand.
The
regulations
provide
several
alternatives
that
are
specifically
designed
to
reduce
administrative
burden
for
sources
that
use
pollution
prevention
or
energy
efficient
projects.

Information
on
the
methodology
and
data
regarding
the
assessment
of
potential
energy
impacts
from
the
8­
hour
ozone
NAAQS
is
found
in
Chapter
6
of
U.
S.
EPA
2003,
Cost,
Emission
Reduction,
Energy,
and
Economic
Impact
Assessment
of
the
71
Proposed
Rule
Establishing
the
Implementation
Framework
for
the
8­
Hour,
0.08
ppm
Ozone
National
Ambient
Air
Quality
Standard,
prepared
by
the
Innovative
Strategies
and
Economics
Group,
Office
of
Air
Quality
Planning
and
Standards,
Research
Triangle
Park,
N.
C.
April
24,
2003.

I.
National
Technology
Transfer
and
Advancement
Act
of
1995
Section
12(
d)
of
the
National
Technology
Transfer
and
Advancement
Act
of
1995
(
NTTAA),
Public
Law
No.
104­
113,

section
12(
d)
(
15
U.
S.
C.
272
note)
directs
us
to
use
voluntary
consensus
standards
(
VCS)
in
our
regulatory
activities
unless
to
do
so
would
be
inconsistent
with
applicable
law
or
otherwise
impractical.
VCS
are
technical
standards
(
for
example,
materials
specifications,
test
methods,
sampling
procedures,
and
business
practices)
that
are
developed
or
adopted
by
voluntary
consensus
standards
bodies.
The
NTTAA
directs
us
to
provide
Congress,
through
OMB,
explanations
when
the
Agency
decides
not
to
use
available
and
applicable
VCS.

Although
this
rule
does
involve
the
use
of
technical
standards,
it
does
not
preclude
the
State,
local,
and
tribal
reviewing
agencies
from
using
VCS.
Today's
rule
is
an
improvement
of
the
existing
NSR
permitting
program.
As
such,
it
only
ensures
that
promulgated
technical
standards
are
considered
and
appropriate
controls
are
installed,
prior
to
the
construction
of
major
sources
of
air
emissions.

Also,
the
rule
for
implementation
of
the
8­
hour
ozone
NAAQS
72
does
not
involve
technical
standards.
Therefore,
we
are
not
considering
the
use
of
any
VCS
in
today's
rule.

J.
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
not
a
"
major
rule"
as
defined
by
5
U.
S.
C.
804(
2).

This
rule
will
be
effective
June
15,
2004.

IX.
Judicial
Review
Under
section
307(
b)(
1)
of
the
CAA,
petitions
for
judicial
review
of
this
action
must
be
filed
in
the
United
States
Court
of
Appeals
for
the
appropriate
circuit
by
[
INSERT
DATE
60
DAYS
AFTER
PUBLICATION
IN
THE
FEDERAL
REGISTER].
Filing
a
petition
for
reconsideration
by
the
Administrator
of
this
final
rule
does
not
affect
the
finality
of
this
rule
for
the
purposes
of
judicial
review
nor
does
it
extend
the
time
within
which
a
73
petition
for
judicial
review
may
be
filed,
and
shall
not
postpone
the
effectiveness
of
such
rule
or
action.
This
action
may
not
be
challenged
later
in
proceedings
to
enforce
its
requirements.
See
CAA
section
307(
b)(
2).

Pursuant
to
section
307(
d)(
1)(
U)
of
the
CAA,
the
Administrator
determines
that
this
action
is
subject
to
the
provisions
of
section
307(
d).
Section
307(
d)(
1)(
U)
provides
that
the
provisions
of
section
307(
d)
apply
to
"
such
other
actions
as
the
Administrator
may
determine."
This
action
finalizes
elements
of
previous
proposed
actions
that
were
determined
to
be
subject
to
Section
307(
d):
the
8­
hour
ozone
implementation
rule
published
on
April
30,
2004
(
69
FR
at
23996);
the
NSR
rules
published
on
December
31,
2002
(
67
FR
at
80244);
and
the
NSR
rules
published
on
August
7,
1980
(
45
FR
at
52676).
Therefore,
the
procedural
requirements
of
section
307(
d)
have
been
complied
with
for
purposes
of
this
action.

X.
Statutory
Authority
The
statutory
authority
for
this
action
is
provided
by
sections
101,
112,
114,
116,
and
301
of
the
Act
as
amended
(
42
U.
S.
C.
7401,
7412,
7414,
7416,
and
7601).
This
rulemaking
is
also
subject
to
section
307(
d)
of
the
Act
(
42
U.
S.
C.
7407(
d)).
74
Nonattainment
New
Source
Review­
page
74
of
173.

LIST
OF
SUBJECTS
40
CFR
Part
51
Environmental
protection,
Administrative
practices
and
procedures,
Air
pollution
control,
Intergovernmental
relations.

40
CFR
Part
52
Environmental
protection,
Administrative
practices
and
procedures,
Air
pollution
control,
Intergovernmental
relations.

____________________

Dated:

_____________________

Michael
O.
Leavitt,

Administrator
75
For
the
reasons
set
out
in
the
preamble,
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
­
7671
q
Subpart
I
­
[
Amended]

2.
Section
51.165
is
amended:

a.
By
revising
paragraphs
(
a)(
1)(
iv)(
A)(
1)
and
(
2).

b.
By
adding
paragraph
(
a)(
1)(
iv)(
A)(
3).

c.
By
adding
paragraphs
(
a)(
1)(
v)(
E)
and
(
F).

d.
By
revising
paragraph
(
a)(
1)(
x).

e.
By
adding
paragraphs
(
a)(
8)
and
(
a)(
9).

The
revisions
and
additions
read
as
follows:

§
51.165
Permit
requirements.

(
a)
*
*
*

(
1)
*
*
*

(
iv)
*
*
*

(
A)
*
*
*

(
1)
Any
stationary
source
of
air
pollutants
which
emits,
or
has
the
potential
to
emit,
100
tons
per
year
or
more
of
any
regulated
NSR
pollutant,
except
that
lower
emissions
thresholds
shall
apply
in
areas
subject
to
subpart
2
or
subpart
3
of
part
D,
title
I
of
the
Act,
according
to
paragraphs
(
a)(
1)(
iv)(
A)(
1)(
i)
through
(
v)
of
this
section.

(
i)
50
tons
per
year
of
volatile
organic
compounds
in
76
any
serious
ozone
nonattainment
area.

(
ii)
50
tons
per
year
of
volatile
organic
compounds
in
an
area
within
an
ozone
transport
region,
except
for
any
severe
or
extreme
ozone
nonattainment
area.

(
iii)
25
tons
per
year
of
volatile
organic
compounds
in
any
severe
ozone
nonattainment
area.

(
iv)
10
tons
per
year
of
volatile
organic
compounds
in
any
extreme
ozone
nonattainment
area.

(
v)
50
tons
per
year
of
carbon
monoxide
in
any
serious
nonattainment
area
for
carbon
monoxide,
where
stationary
sources
contribute
significantly
to
carbon
monoxide
levels
in
the
area
(
as
determined
under
rules
issued
by
the
Administrator);

(
2)
For
the
purposes
of
applying
the
requirements
of
paragraph
(
a)(
8)
of
this
section
to
stationary
sources
of
nitrogen
oxides
located
in
an
ozone
nonattainment
area
or
in
an
ozone
transport
region,
any
stationary
source
which
emits,
or
has
the
potential
to
emit,
100
tons
per
year
or
more
of
nitrogen
oxides
emissions,
except
that
the
emission
thresholds
in
paragraphs
(
a)(
1)(
iv)(
A)(
2)(
i)
through
(
vi)
of
this
section
shall
apply
in
areas
subject
to
subpart
2
of
part
D,
title
I
of
the
Act.

(
i)
100
tons
per
year
or
more
of
nitrogen
oxides
in
any
ozone
nonattainment
area
classified
as
marginal
or
moderate.

(
ii)
100
tons
per
year
or
more
of
nitrogen
oxides
in
any
ozone
nonattainment
area
classified
as
a
transitional,
77
submarginal,
or
incomplete
or
no
data
area,
when
such
area
is
located
in
an
ozone
transport
region.

(
iii)
100
tons
per
year
or
more
of
nitrogen
oxides
in
any
area
designated
under
section
107(
d)
of
the
Act
as
attainment
or
unclassifiable
for
ozone
that
is
located
in
an
ozone
transport
region.

(
iv)
50
tons
per
year
or
more
of
nitrogen
oxides
in
any
serious
nonattainment
area
for
ozone.

(
v)
25
tons
per
year
or
more
of
nitrogen
oxides
in
any
severe
nonattainment
area
for
ozone.

(
vi)
10
tons
per
year
or
more
of
nitrogen
oxides
in
any
extreme
nonattainment
area
for
ozone;
or
(
3)
Any
physical
change
that
would
occur
at
a
stationary
source
not
qualifying
under
paragraphs
(
a)(
1)(
iv)(
A)(
1)
or
(
2)
of
this
section
as
a
major
stationary
source,
if
the
change
would
constitute
a
major
stationary
source
by
itself.

*
*
*
*
*

(
v)
*
*
*

(
E)
For
the
purpose
of
applying
the
requirements
of
(
a)(
8)
of
this
section
to
modifications
at
major
stationary
sources
of
nitrogen
oxides
located
in
ozone
nonattainment
areas
or
in
ozone
transport
regions,
whether
or
not
subject
to
subpart
2,
part
D,
title
I
of
the
Act,
any
significant
net
emissions
increase
of
nitrogen
oxides
is
considered
significant
for
ozone.
78
(
F)
Any
physical
change
in,
or
change
in
the
method
of
operation
of,
a
major
stationary
source
of
volatile
organic
compounds
that
results
in
any
increase
in
emissions
of
volatile
organic
compounds
from
any
discrete
operation,

emissions
unit,
or
other
pollutant
emitting
activity
at
the
source
shall
be
considered
a
significant
net
emissions
increase
and
a
major
modification
for
ozone,
if
the
major
stationary
source
is
located
in
an
extreme
ozone
nonattainment
area
that
is
subject
to
subpart
2,
part
D,

title
I
of
the
Act.

*
*
*
*
*

(
x)(
A)
Significant
means,
in
reference
to
a
net
emissions
increase
or
the
potential
of
a
source
to
emit
any
of
the
following
pollutants,
a
rate
of
emissions
that
would
equal
or
exceed
any
of
the
following
rates:

POLLUTANT
EMISSION
RATE
Carbon
monoxide:
100
tons
per
year
(
tpy)

Nitrogen
oxides:
40
tpy
Sulfur
dioxide:
40
tpy
Ozone:
40
tpy
of
volatile
organic
compounds
Lead:
0.6
tpy
(
B)
Notwithstanding
the
significant
emissions
rate
for
ozone
in
paragraph
(
a)(
1)(
x)(
A)
of
this
section,
significant
means,
in
reference
to
an
emissions
increase
or
a
net
emissions
increase,
any
increase
in
actual
emissions
of
volatile
organic
compounds
that
would
result
from
any
79
physical
change
in,
or
change
in
the
method
of
operation
of,

a
major
stationary
source
locating
in
a
serious
or
severe
ozone
nonattainment
area
that
is
subject
to
subpart
2,
part
D,
title
I
of
the
Act,
if
such
emissions
increase
of
volatile
organic
compounds
exceeds
25
tons
per
year.

(
C)
For
the
purposes
of
applying
the
requirements
of
paragraph
(
a)(
8)
of
this
section
to
modifications
at
major
stationary
sources
of
nitrogen
oxides
located
in
an
ozone
nonattainment
area
or
in
an
ozone
transport
region,
the
significant
emission
rates
and
other
requirements
for
volatile
organic
compounds
in
paragraphs
(
a)(
1)(
x)(
A),
(
B),

and
(
E)
of
this
section
shall
apply
to
nitrogen
oxides
emissions.

(
D)
Notwithstanding
the
significant
emissions
rate
for
carbon
monoxide
under
paragraph
(
a)(
1)(
x)(
A)
of
this
section,
significant
means,
in
reference
to
an
emissions
increase
or
a
net
emissions
increase,
any
increase
in
actual
emissions
of
carbon
monoxide
that
would
result
from
any
physical
change
in,
or
change
in
the
method
of
operation
of,

a
major
stationary
source
in
a
serious
nonattainment
area
for
carbon
monoxide
is
significant
if
such
increase
equals
or
exceeds
50
tons
per
year,
provided
the
Administrator
has
determined
that
stationary
sources
contribute
significantly
to
carbon
monoxide
levels
in
that
area.

(
E)
Notwithstanding
the
significant
emissions
rates
for
ozone
under
paragraphs
(
a)(
1)(
x)(
A)
and
(
B)
of
this
80
section,
any
increase
in
actual
emissions
of
volatile
organic
compounds
from
any
emissions
unit
at
a
major
stationary
source
of
volatile
organic
compounds
located
in
an
extreme
ozone
nonattainment
area
that
is
subject
to
subpart
2,
part
D,
title
I
of
the
Act
shall
be
considered
a
significant
net
emissions
increase.

*
*
*
*
*

(
8)
The
plan
shall
provide
that
the
requirements
of
this
section
applicable
to
major
stationary
sources
and
major
modifications
of
volatile
organic
compounds
shall
apply
to
nitrogen
oxides
emissions
from
major
stationary
sources
and
major
modifications
of
nitrogen
oxides
in
an
ozone
transport
region
or
in
any
ozone
nonattainment
area,

except
in
ozone
nonattainment
areas
where
the
Administrator
has
granted
a
NOx
waiver
applying
the
standards
set
forth
under
182(
f)
and
the
waiver
continues
to
apply.

(
9)(
i)
The
plan
shall
require
that
in
meeting
the
emissions
offset
requirements
of
paragraph
(
a)(
3)
of
this
section
for
ozone
nonattainment
areas
that
are
subject
to
subpart
2,
part
D,
title
I
of
the
Act,
the
ratio
of
total
actual
emissions
reductions
of
VOC
to
the
emissions
increase
of
VOC
shall
be
as
follows:

(
A)
In
any
marginal
nonattainment
area
for
ozone
 
at
least
1.1:
1;

(
B)
In
any
moderate
nonattainment
area
for
ozone
 
at
least
1.15:
1;
81
(
C)
In
any
serious
nonattainment
area
for
ozone
 
at
least
1.2:
1;

(
D)
In
any
severe
nonattainment
area
for
ozone
 
at
least
1.3:
1
(
except
that
the
ratio
may
be
at
least
1.2:
1
if
the
approved
plan
also
requires
all
existing
major
sources
in
such
nonattainment
area
to
use
BACT
for
the
control
of
VOC);
and
(
E)
In
any
extreme
nonattainment
area
for
ozone
 
at
least
1.5:
1
(
except
that
the
ratio
may
be
at
least
1.2:
1
if
the
approved
plan
also
requires
all
existing
major
sources
in
such
nonattainment
area
to
use
BACT
for
the
control
of
VOC);
and
(
ii)
Notwithstanding
the
requirements
of
paragraph
(
a)(
9)(
i)
of
this
section
for
meeting
the
requirements
of
paragraph
(
a)(
3)
of
this
section,
the
ratio
of
total
actual
emissions
reductions
of
VOC
to
the
emissions
increase
of
VOC
shall
be
at
least
1.15:
1
for
all
areas
within
an
ozone
transport
region
that
is
subject
to
subpart
2,
part
D,
title
I
of
the
Act,
except
for
serious,
severe,
and
extreme
ozone
nonattainment
areas
that
are
subject
to
subpart
2,
part
D,

title
I
of
the
Act.

*
*
*
*
*

Appendix
S
to
Part
51
­
[
Amended]

3.
Appendix
S
to
Part
51
is
amended
as
follows:

a.
By
revising
paragraph
II.
A.
1.

b.
By
revising
paragraph
II.
A.
4(
i)(
a)
and
(
b).
82
c.
By
adding
paragraph
II.
A.
4(
i)(
c).

d.
By
revising
paragraphs
II.
A.
5(
i)
and
(
ii).

e.
By
adding
paragraph
II.
A.
5(
iii)(
h).

f.
By
adding
paragraphs
II.
A.
5(
iv)
through
(
vi).

g.
By
revising
paragraph
II.
A.
6(
i).

h.
By
revising
paragraph
II.
A.
6(
iii).

i.
By
revising
paragraph
II.
A.
6(
v)(
b)
through
(
d).

j.
By
adding
paragraph
II.
A.
6(
v)(
e).

k.
By
adding
paragraph
II.
A.
6(
vii).

l.
By
revising
paragraph
II.
A.
7.

m.
By
adding
paragraphs
II.
A.
10(
ii)
through
(
v).

n.
By
revising
paragraph
II.
A.
13.

o.
By
revising
paragraph
II.
A.
14.

p.
By
revising
the
introductory
text
in
paragraph
II.
A.
18.

q.
By
adding
paragraphs
II.
A.
21
through
38.

r.
By
amending
paragraph
IV.
A
Condition
1
by
removing
footnote
5.

s.
By
amending
paragraph
IV.
A
Condition
3
by
redesignating
footnote
6
as
footnote
5
and
by
redesignating
footnote
7
as
footnote
6.

t.
By
amending
paragraph
IV.
A
Condition
4
by
removing
footnote
8.

u.
By
adding
paragraphs
IV.
C.
7
and
8.

v.
By
revising
paragraph
IV.
D.

w.
By
revising
paragraph
IV.
E.
83
x.
By
adding
paragraphs
IV.
G
through
O.

y.
By
amending
paragraph
V.
A
by
redesignating
footnote
10
as
footnote
7.

z.
By
revising
paragraph
VI.

The
revisions
and
additions
read
as
follows:

Appendix
S
to
Part
51
 
Emission
Offset
Interpretative
Ruling.

*
*
*
*
*

II.
*
*
*

A.
*
*
*

1.
Stationary
source
means
any
building,
structure,

facility,
or
installation
which
emits
or
may
emit
a
regulated
NSR
pollutant.

*
*
*
*
*

4.(
i)
*
*
*

(
a)
Any
stationary
source
of
air
pollutants
which
emits,
or
has
the
potential
to
emit,
100
tons
per
year
or
more
of
any
regulated
NSR
pollutant,
except
that
lower
emissions
thresholds
shall
apply
in
areas
subject
to
subpart
2
or
subpart
3
of
part
D,
title
I
of
the
Act,
according
to
paragraphs
II.
A.
4(
i)(
a)(
1)
through
(
5)
of
this
Ruling.

(
1)
50
tons
per
year
of
volatile
organic
compounds
in
any
serious
ozone
nonattainment
area.

(
2)
50
tons
per
year
of
volatile
organic
compounds
in
an
area
within
an
ozone
transport
region,
except
for
any
severe
or
extreme
ozone
nonattainment
area.

(
3)
25
tons
per
year
of
volatile
organic
compounds
in
84
any
severe
ozone
nonattainment
area.

(
4)
10
tons
per
year
of
volatile
organic
compounds
in
any
extreme
ozone
nonattainment
area.

(
5)
50
tons
per
year
of
carbon
monoxide
in
any
serious
nonattainment
area
for
carbon
monoxide,
where
stationary
sources
contribute
significantly
to
carbon
monoxide
levels
in
the
area
(
as
determined
under
rules
issued
by
the
Administrator);

(
b)
For
the
purposes
of
applying
the
requirements
of
paragraph
IV.
N
of
this
Ruling
to
stationary
sources
of
nitrogen
oxides
located
in
an
ozone
nonattainment
area
or
in
an
ozone
transport
region,
any
stationary
source
which
emits,
or
has
the
potential
to
emit,
100
tons
per
year
or
more
of
nitrogen
oxides
emissions,
except
that
the
emission
thresholds
in
paragraphs
II.
A.
4(
i)(
b)(
1)
through
(
6)
of
this
Ruling
apply
in
areas
subject
to
subpart
2
of
part
D,
title
I
of
the
Act.

(
1)
100
tons
per
year
or
more
of
nitrogen
oxides
in
any
ozone
nonattainment
area
classified
as
marginal
or
moderate.

(
2)
100
tons
per
year
or
more
of
nitrogen
oxides
in
any
ozone
nonattainment
area
classified
as
a
transitional,

submarginal,
or
incomplete
or
no
data
area,
when
such
area
is
located
in
an
ozone
transport
region.

(
3)
100
tons
per
year
or
more
of
nitrogen
oxides
in
any
area
designated
under
section
107(
d)
of
the
Act
as
attainment
or
unclassifiable
for
ozone
that
is
located
in
an
85
ozone
transport
region.

(
4)
50
tons
per
year
or
more
of
nitrogen
oxides
in
any
serious
nonattainment
area
for
ozone.

(
5)
25
tons
per
year
or
more
of
nitrogen
oxides
in
any
severe
nonattainment
area
for
ozone.

(
6)
10
tons
per
year
or
more
of
nitrogen
oxides
in
any
extreme
nonattainment
area
for
ozone;
or
(
c)
Any
physical
change
that
would
occur
at
a
stationary
source
not
qualifying
under
paragraph
II.
A.
4(
i)(
a)
or
(
b)
of
this
Ruling
as
a
major
stationary
source,
if
the
change
would
constitute
a
major
stationary
source
by
itself.

*
*
*
*
*

5.(
i)
Major
modification
means
any
physical
change
in
or
change
in
the
method
of
operation
of
a
major
stationary
source
that
would
result
in:

(
a)
A
significant
emissions
increase
of
a
regulated
NSR
pollutant
(
as
defined
in
paragraph
II.
A.
33
of
this
Ruling);
and
(
b)
A
significant
net
emissions
increase
of
that
pollutant
from
the
major
stationary
source.

(
ii)
Any
significant
emissions
increase
(
as
defined
in
paragraph
II.
A.
24
of
this
Ruling)
from
any
emissions
units
or
net
emissions
increase
(
as
defined
in
paragraph
II.
A.
6
of
this
Ruling)
at
a
major
stationary
source
that
is
significant
for
volatile
organic
compounds
shall
be
86
considered
significant
for
ozone.

(
iii)
*
*
*

(
h)
The
addition,
replacement,
or
use
of
a
PCP,
as
defined
in
paragraph
II.
A.
22
of
this
Ruling,
at
an
existing
emissions
unit
meeting
the
requirements
of
paragraph
IV.
K
of
this
Ruling.
A
replacement
control
technology
must
provide
more
effective
emissions
control
than
that
of
the
replaced
control
technology
to
qualify
for
this
exclusion.

(
iv)
This
definition
shall
not
apply
with
respect
to
a
particular
regulated
NSR
pollutant
when
the
major
stationary
source
is
complying
with
the
requirements
under
paragraph
IV.
L
of
this
ruling
for
a
PAL
for
that
pollutant.
Instead,

the
definition
at
paragraph
IV.
L.
2(
viii)
of
this
Ruling
shall
apply.

(
v)
For
the
purpose
of
applying
the
requirements
of
paragraph
IV.
N
of
this
Ruling
to
modifications
at
major
stationary
sources
of
nitrogen
oxides
located
in
ozone
nonattainment
areas
or
in
ozone
transport
regions,
whether
or
not
subject
to
subpart
2,
part
D,
title
I
of
the
Act,
any
significant
net
emissions
increase
of
nitrogen
oxides
is
considered
significant
for
ozone.

(
vi)
Any
physical
change
in,
or
change
in
the
method
of
operation
of,
a
major
stationary
source
of
volatile
organic
compounds
that
results
in
any
increase
in
emissions
of
volatile
organic
compounds
from
any
discrete
operation,

emissions
unit,
or
other
pollutant
emitting
activity
at
the
87
source
shall
be
considered
a
significant
net
emissions
increase
and
a
major
modification
for
ozone,
if
the
major
stationary
source
is
located
in
an
extreme
ozone
nonattainment
area
that
is
subject
to
subpart
2,
part
D,

title
I
of
the
Act.

6.(
i)
Net
emissions
increase
means,
with
respect
to
any
regulated
NSR
pollutant
emitted
by
a
major
stationary
source,
the
amount
by
which
the
sum
of
the
following
exceeds
zero:

(
a)
The
increase
in
emissions
from
a
particular
physical
change
or
change
in
the
method
of
operation
at
a
stationary
source
as
calculated
pursuant
to
paragraph
IV.
H
of
this
Ruling;
and
(
b)
Any
other
increases
and
decreases
in
actual
emissions
at
the
major
stationary
source
that
are
contemporaneous
with
the
particular
change
and
are
otherwise
creditable.
Baseline
actual
emissions
for
calculating
increases
and
decreases
under
this
paragraph
II.
A.
6(
i)(
b)

shall
be
determined
as
provided
in
paragraph
II.
A.
32
of
this
Ruling,
except
that
paragraphs
II.
A.
32(
i)(
c)
and
II.
A.
32(
ii)(
d)
of
this
Ruling
shall
not
apply.

*
*
*
*
*

(
iii)
An
increase
or
decrease
in
actual
emissions
is
creditable
only
if:

(
a)
The
reviewing
authority
has
not
relied
on
it
in
issuing
a
permit
for
the
source
under
this
Ruling,
which
88
permit
is
in
effect
when
the
increase
in
actual
emissions
from
the
particular
change
occurs;
and
(
b)
The
increase
or
decrease
in
emissions
did
not
occur
at
a
Clean
Unit,
except
as
provided
in
paragraphs
IV.
I.
8
and
IV.
J.
10
of
this
Ruling.

*
*
*
*
*

(
v)
*
*
*

(
b)
It
is
enforceable
as
a
practical
matter
at
and
after
the
time
that
actual
construction
on
the
particular
change
begins;

(
c)
The
reviewing
authority
has
not
relied
on
it
in
issuing
any
permit
under
regulations
approved
pursuant
to
40
CFR
51.165;

(
d)
It
has
approximately
the
same
qualitative
significance
for
public
health
and
welfare
as
that
attributed
to
the
increase
from
the
particular
change;
and
(
e)
The
decrease
in
actual
emissions
did
not
result
from
the
installation
of
add­
on
control
technology
or
application
of
pollution
prevention
practices
that
were
relied
on
in
designating
an
emissions
unit
as
a
Clean
Unit
under
paragraph
IV.
J
of
this
Ruling,
under
40
CFR
52.21(
y),

or
under
regulations
approved
pursuant
to
§
51.165(
d)
or
§
51.166(
u)
of
this
part.
That
is,
once
an
emissions
unit
has
been
designated
as
a
Clean
Unit,
the
owner
or
operator
cannot
later
use
the
emissions
reduction
from
the
air
pollution
control
measures
that
the
Clean
Unit
designation
89
is
based
on
in
calculating
the
net
emissions
increase
for
another
emissions
unit
(
i.
e.,
must
not
use
that
reduction
in
a
"
netting
analysis"
for
another
emissions
unit).
However,

any
new
emissions
reductions
that
were
not
relied
upon
in
a
PCP
excluded
pursuant
to
paragraph
IV.
K
of
this
Ruling
or
for
a
Clean
Unit
designation
are
creditable
to
the
extent
they
meet
the
requirements
in
paragraphs
IV.
K.
6(
iv)
of
this
Ruling
for
the
PCP
and
paragraphs
IV.
I.
8
or
IV.
J.
10
of
this
Ruling
for
a
Clean
Unit.

*
*
*
*
*

(
vii)
Paragraph
II.
A.
13(
ii)
of
this
Ruling
shall
not
apply
for
determining
creditable
increases
and
decreases
or
after
a
change.

7.
Emissions
unit
means
any
part
of
a
stationary
source
that
emits
or
would
have
the
potential
to
emit
any
regulated
NSR
pollutant
and
includes
an
electric
utility
steam
generating
unit
as
defined
in
paragraph
II.
A.
21
of
this
Ruling.
For
purposes
of
this
Ruling,
there
are
two
types
of
emissions
units
as
described
in
paragraphs
II.
A.
7(
i)
and
(
ii)
of
this
Ruling.

(
i)
A
new
emissions
unit
is
any
emissions
unit
which
is
(
or
will
be)
newly
constructed
and
which
has
existed
for
less
than
2
years
from
the
date
such
emissions
unit
first
operated.

(
ii)
An
existing
emissions
unit
is
any
emissions
unit
that
does
not
meet
the
requirements
in
paragraph
II.
A.
7(
i)
90
of
this
Ruling.

*
*
*
*
*

10.
*
*
*

(
ii)
Notwithstanding
the
significant
emissions
rate
for
ozone
in
paragraph
II.
A.
10(
i)
of
this
Ruling,

significant
means,
in
reference
to
an
emissions
increase
or
a
net
emissions
increase,
any
increase
in
actual
emissions
of
volatile
organic
compounds
that
would
result
from
any
physical
change
in,
or
change
in
the
method
of
operation
of,

a
major
stationary
source
locating
in
a
serious
or
severe
ozone
nonattainment
area
that
is
subject
to
subpart
2,
part
D,
title
I
of
the
Act,
if
such
emissions
increase
of
volatile
organic
compounds
exceeds
25
tons
per
year.

(
iii)
For
the
purposes
of
applying
the
requirements
of
paragraph
IV.
N
of
this
Ruling
to
modifications
at
major
stationary
sources
of
nitrogen
oxides
located
in
an
ozone
nonattainment
area
or
in
an
ozone
transport
region,
the
significant
emission
rates
and
other
requirements
for
volatile
organic
compounds
in
paragraphs
II.
A.
10(
i),
(
ii),

and
(
v)
of
this
Ruling
shall
apply
to
nitrogen
oxides
emissions.

(
iv)
Notwithstanding
the
significant
emissions
rate
for
carbon
monoxide
under
paragraph
II.
A.
10(
i)
of
this
Ruling,
significant
means,
in
reference
to
an
emissions
increase
or
a
net
emissions
increase,
any
increase
in
actual
emissions
of
carbon
monoxide
that
would
result
from
any
91
physical
change
in,
or
change
in
the
method
of
operation
of,

a
major
stationary
source
in
a
serious
nonattainment
area
for
carbon
monoxide
is
significant
if
such
increase
equals
or
exceeds
50
tons
per
year,
provided
the
Administrator
has
determined
that
stationary
sources
contribute
significantly
to
carbon
monoxide
levels
in
that
area.

(
v)
Notwithstanding
the
significant
emissions
rates
for
ozone
under
paragraphs
II.
A.
10(
i)
and
(
ii)
of
this
Ruling,
any
increase
in
actual
emissions
of
volatile
organic
compounds
from
any
emissions
unit
at
a
major
stationary
source
of
volatile
organic
compounds
located
in
an
extreme
ozone
nonattainment
area
that
is
subject
to
subpart
2,
part
D,
title
I
of
the
Act
shall
be
considered
a
significant
net
emissions
increase.

*
*
*
*
*

13.(
i)
Actual
emissions
means
the
actual
rate
of
emissions
of
a
regulated
NSR
pollutant
from
an
emissions
unit,
as
determined
in
accordance
with
paragraphs
II.
A.
13(
ii)
through
(
iv)
of
this
Ruling,
except
that
this
definition
shall
not
apply
for
calculating
whether
a
significant
emissions
increase
has
occurred,
or
for
establishing
a
PAL
under
paragraph
IV.
L
of
this
Ruling.

Instead,
paragraphs
II.
A.
25
and
32
of
this
Ruling
shall
apply
for
those
purposes.

(
ii)
In
general,
actual
emissions
as
of
a
particular
date
shall
equal
the
average
rate,
in
tons
per
year,
at
92
which
the
unit
actually
emitted
the
pollutant
during
a
consecutive
24­
month
period
which
precedes
the
particular
date
and
which
is
representative
of
normal
source
operation.

The
reviewing
authority
shall
allow
the
use
of
a
different
time
period
upon
a
determination
that
it
is
more
representative
of
normal
source
operation.
Actual
emissions
shall
be
calculated
using
the
unit's
actual
operating
hours,

production
rates,
and
types
of
materials
processed,
stored,

or
combusted
during
the
selected
time
period.

(
iii)
The
reviewing
authority
may
presume
that
sourcespecific
allowable
emissions
for
the
unit
are
equivalent
to
the
actual
emissions
of
the
unit.

(
iv)
For
any
emissions
unit
that
has
not
begun
normal
operations
on
the
particular
date,
actual
emissions
shall
equal
the
potential
to
emit
of
the
unit
on
that
date.

14.
Construction
means
any
physical
change
or
change
in
the
method
of
operation
(
including
fabrication,
erection,

installation,
demolition,
or
modification
of
an
emissions
unit)
that
would
result
in
a
change
in
emissions.

*
*
*
*
*

18.
Lowest
achievable
emission
rate
(
LAER)
means,
for
any
source,
the
more
stringent
rate
of
emissions
based
on
the
following:
*
*
*

*
*
*
*
*

21.
Electric
utility
steam
generating
unit
means
any
steam
electric
generating
unit
that
is
constructed
for
the
93
purpose
of
supplying
more
than
one­
third
of
its
potential
electric
output
capacity
and
more
than
25
MW
electrical
output
to
any
utility
power
distribution
system
for
sale.

Any
steam
supplied
to
a
steam
distribution
system
for
the
purpose
of
providing
steam
to
a
steam­
electric
generator
that
would
produce
electrical
energy
for
sale
is
also
considered
in
determining
the
electrical
energy
output
capacity
of
the
affected
facility.

22.
Pollution
control
project
(
PCP)
means
any
activity,
set
of
work
practices
or
project
(
including
pollution
prevention
as
defined
under
paragraph
II.
A.
23
of
this
Ruling)
undertaken
at
an
existing
emissions
unit
that
reduces
emissions
of
air
pollutants
from
such
unit.
Such
qualifying
activities
or
projects
can
include
the
replacement
or
upgrade
of
an
existing
emissions
control
technology
with
a
more
effective
unit.
Other
changes
that
may
occur
at
the
source
are
not
considered
part
of
the
PCP
if
they
are
not
necessary
to
reduce
emissions
through
the
PCP.
Projects
listed
in
paragraphs
II.
A.
22(
i)
through
(
vi)

of
this
Ruling
are
presumed
to
be
environmentally
beneficial
pursuant
to
paragraph
IV.
K.
2(
i)
of
this
Ruling.
Projects
not
listed
in
these
paragraphs
may
qualify
for
a
casespecific
PCP
exclusion
pursuant
to
the
requirements
of
paragraphs
IV.
K.
2
and
5
of
this
Ruling.

(
i)
Conventional
or
advanced
flue
gas
desulfurization
or
sorbent
injection
for
control
of
SO2.
94
(
ii)
Electrostatic
precipitators,
baghouses,
high
efficiency
multiclones,
or
scrubbers
for
control
of
particulate
matter
or
other
pollutants.

(
iii)
Flue
gas
recirculation,
low­
NOx
burners
or
combustors,
selective
non­
catalytic
reduction,
selective
catalytic
reduction,
low
emission
combustion
(
for
IC
engines),
and
oxidation/
absorption
catalyst
for
control
of
NOx.

(
iv)
Regenerative
thermal
oxidizers,
catalytic
oxidizers,
condensers,
thermal
incinerators,
hydrocarbon
combustion
flares,
biofiltration,
absorbers
and
adsorbers,

and
floating
roofs
for
storage
vessels
for
control
of
volatile
organic
compounds
or
hazardous
air
pollutants.
For
the
purpose
of
this
Ruling,
"
hydrocarbon
combustion
flare"

means
either
a
flare
used
to
comply
with
an
applicable
NSPS
or
MACT
standard
(
including
uses
of
flares
during
startup,

shutdown,
or
malfunction
permitted
under
such
a
standard),

or
a
flare
that
serves
to
control
emissions
of
waste
streams
comprised
predominately
of
hydrocarbons
and
containing
no
more
than
230
mg/
dscm
hydrogen
sulfide.

(
v)
Activities
or
projects
undertaken
to
accommodate
switching
(
or
partially
switching)
to
an
inherently
less
polluting
fuel,
to
be
limited
to
the
following
fuel
switches:

(
a)
Switching
from
a
heavier
grade
of
fuel
oil
to
a
lighter
fuel
oil,
or
any
grade
of
oil
to
0.05
percent
sulfur
95
diesel
(
i.
e.,
from
a
higher
sulfur
content
#
2
fuel
or
from
#
6
fuel,
to
CA
0.05
percent
sulfur
#
2
diesel);

(
b)
Switching
from
coal,
oil,
or
any
solid
fuel
to
natural
gas,
propane,
or
gasified
coal;
