

[Federal Register: September 21, 2007 (Volume 72, Number 183)]
[Proposed Rules]               
[Page 54111-54156]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21se07-26]                         


[[Page 54111]]

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Part II





Environmental Protection Agency





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40 CFR Parts 51 and 52



 Prevention of Significant Deterioration (PSD) for Particulate Matter 
Less Than 2.5 Micrometers (PM2.5)--Increments, Significant 
Impact Levels (SILs) and Significant Monitoring Concentration (SMC); 
Proposed Rule


[[Page 54112]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 51 and 52

[EPA-HQ-OAR-2006-0605; FRL-8470-1]
RIN 2060-AO24

 
Prevention of Significant Deterioration (PSD) for Particulate 
Matter Less Than 2.5 Micrometers (PM2.5)--Increments, 
Significant Impact Levels (SILs) and Significant Monitoring 
Concentration (SMC)

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Clean Air Act (Act) authorizes EPA to establish 
regulations to prevent significant deterioration of air quality due to 
emissions of any pollutant for which a national ambient air quality 
standard (NAAQS) has been promulgated. The NAAQS for particulate matter 
using the PM2.5 indicator were promulgated in 1997. The EPA 
is proposing to facilitate implementation of a PM2.5 
Prevention of Significant Deterioration (PSD) program in areas 
attaining the particulate matter less than 2.5 micrometers 
(PM2.5) NAAQS by developing PM2.5 increments, 
Significant Impact Levels (SILs), and a Significant Monitoring 
Concentration (SMC). In addition, EPA is proposing to revoke the annual 
PM10 increments.
    ``Increments'' are maximum increases in ambient PM2.5 
concentrations (PM2.5 increments) allowed in an area above 
the baseline concentration. The SILs and SMCs are numerical values that 
represent thresholds of insignificant, i.e., de minimis, modeled source 
impacts or monitored (ambient) concentrations, respectively. The EPA is 
proposing such values for PM2.5 that will be used as 
screening tools by a major source subject to PSD to determine the 
subsequent level of analysis and data gathering required for a PSD 
permit application for emissions of PM2.5.

DATES: Comments must be received on or before November 20, 2007. Under 
the Paperwork Reduction Act, comments on the information collection 
provisions must be received by the Office of Management and Budget 
(OMB) on or before October 22, 2007.
    Public Hearing. If anyone contacts us requesting to speak at a 
public hearing by October 11, 2007, we will hold a public hearing. 
Additional information about the hearing would be published in a 
subsequent Federal Register notice.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2006-0605, by one of the following methods:
     http://www.regulations.gov. Follow the on-line instructions for 

submitting comments.
     E-mail: a-and-r-Docket@.epa.gov.
     Mail: Air and Radiation Docket and Information Center, 
Environmental Protection Agency, Mailcode: 2822T, 1200 Pennsylvania 
Avenue, NW., Washington, DC 20460. Please include a total of two 
copies. In addition, please mail a copy of your comments on the 
information collection provisions to the Office of Information and 
Regulatory Affairs, Office of Management and Budget (OMB), Attn: Desk 
Officer for EPA, 725 17th Street, Northwest, Washington, DC 20503.
     Hand Delivery: Air and Radiation Docket and Information 
Center, EPA/DC, EPA West, Room 3334, 1301 Constitution Avenue, NW., 
Washington, DC 20004. Such deliveries are only accepted during the 
Docket Center's normal hours of operation, and special arrangements 
should be made for deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2006-0605. The EPA's policy is that all comments received will be 
included in the public docket without change and may be made available 
online at http://www.regulations.gov, including any personal information 

provided, unless the comment includes information claimed to be 
Confidential Business Information (CBI) or other information whose 
disclosure is restricted by statute. Do not submit information that you 
consider to be CBI or otherwise protected through http://www.regulations.gov 

or e-mail. The http://www.regulations.gov Web site is an ``anonymous access'' 

system, which means EPA will not know your identity or contact 
information unless you provide it in the body of your comment. If you 
send an e-mail comment directly to EPA without going through 
http://www.regulations.gov your e-mail address will be automatically captured 

and included as part of the comment that is placed in the public docket 
and made available on the Internet. If you submit an electronic 
comment, EPA recommends that you include your name and other contact 
information in the body of your comment and with any disk or CD-ROM you 
submit. If EPA cannot read your comment due to technical difficulties 
and cannot contact you for clarification, EPA may not be able to 
consider your comment. Electronic files should avoid the use of special 
characters, any form of encryption, and be free of any defects or 
viruses. For additional instructions on submitting comments, go to 
section I.B of the SUPPLEMENTARY INFORMATION section of this document.
    Docket: All documents in the docket are listed in the 
http://www.regulations.gov index. Although listed in the index, some 

information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hard copy. 
Publicly available docket materials are available either electronically 
in http://www.regulations.gov or in hard copy at the Air and Radiation Docket 

and Information Center, EPA/DC, EPA West, Room 3334, 1301 Constitution 
Avenue, Northwest, 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 and Radiation Docket and 
Information Center is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: Mr. Raghavendra (Raj) Rao, Air Quality 
Policy Division, Office of Air Quality Planning and Standards (C504-
03), Environmental Protection Agency, Research Triangle Park, North 
Carolina 27711; telephone number (919) 541-5344; fax number (919) 541-
5509; e-mail address: rao.raj@epa.gov or Dan deRoeck, Air Quality 
Policy Division, Office of Air Quality Planning and Standards (C504-
03), Environmental Protection Agency, Research Triangle Park, North 
Carolina 27711; telephone number (919) 541-5593; fax number (919) 541-
5509; e-mail address: deroeck.dan@epa.gov. To request a public hearing 
or information pertaining to a public hearing on this document, contact 
Ms. Pamela S. Long, Air Quality Policy Division, Office of Air Quality 
Planning and Standards (C504-03), Environmental Protection Agency, 
Research Triangle Park, North Carolina 27711; telephone number (919) 
541-0641; fax number (919) 541-5509; e-mail address: long.pam@epa.gov.

SUPPLEMENTARY INFORMATION: 

I. General Information

A. Does this action apply to me?

    Entities potentially affected by this proposed action include 
owners and operators of emission sources in all industry groups, as 
well as the EPA and State, local, and tribal governments that are 
delegated authority to implement these regulations. The majority of 
sources potentially affected are expected to be in the following 
groups:

[[Page 54113]]



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             Category                    NAICS\a\                             Industry group
----------------------------------------------------------------------------------------------------------------
Industry.........................  221111, 221112,       Electric services.
                                    221113, 221119,
                                    221121, 221122.
                                   32411...............  Petroleum refining.
                                   325181, 32512,        Industrial inorganic chemicals.
                                    325131, 325182,
                                    211112, 325998,
                                    331311, 325188.
                                   32511, 325132,        Industrial organic chemicals.
                                    325192, 325188,
                                    325193, 32512,
                                    325199.
                                   32552, 32592, 32591,  Miscellaneous chemical products.
                                    325182, 32551.
                                   211112..............  Natural gas liquids.
                                   48621, 22121........  Natural gas transport.
                                   32211, 322121,        Pulp and paper mills.
                                    322122, 32213.
                                   322121, 322122......  Paper mills.
                                   336111, 336112,       Automobile manufacturing.
                                    336712, 336211,
                                    336992, 336322,
                                    336312, 33633,
                                    33634, 33635,
                                    336399, 336212,
                                    336213.
                                   325411, 325412,       Pharmaceuticals.
                                    325413, 325414.
Federal government...............  924110..............  Administration of Air and Water Resources and Solid
                                                          Waste Management Programs.
State/local/tribal Government....  924110..............  Administration of Air and Water Resources and Solid
                                                          Waste Management Programs.
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\a\ North American Industry Classification System.

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be regulated by this 
action. To determine whether your facility is regulated by this action, 
you should examine the applicability criteria in the PSD rules for 
attainment areas (40 CFR 52.21). If you have any questions regarding 
the applicability of this action to a particular entity, contact the 
person listed in the preceding FOR FURTHER INFORMATION CONTACT section.

B. What should I consider as I prepare my comments for EPA?

    1. Submitting CBI. Do not submit this information to EPA through 
http://www.regulations.gov or e-mail. Clearly mark the part or all of the 

information that you claim to be CBI. For CBI information in a disk or 
CD ROM that you mail to EPA, mark the outside of the disk or CD ROM as 
CBI and then identify electronically within the disk or CD ROM the 
specific information that is claimed as CBI. In addition to one 
complete version of the comment that includes information claimed as 
CBI, a copy of the comment that does not contain the information 
claimed as CBI must be submitted for inclusion in the public docket. 
Information so marked will not be disclosed except in accordance with 
procedures set forth in 40 CFR part 2. Send or deliver information 
identified as CBI only to the following address: Roberto Morales, OAQPS 
Document Control Officer (C404-02), Environmental Protection Agency, 
Research Triangle Park, NC 27711, Attention Docket ID No. EPA-HQ-OAR-
2006-0605.
    2. Tips for Preparing Your Comments. When submitting comments, 
remember to:
     Identify the rulemaking by docket number and other 
identifying information (subject heading, Federal Register date and 
page number).
     Follow directions--The agency may ask you to respond to 
specific questions or organize comments by referencing a Code of 
Federal Regulations (CFR) part or section number.
     Explain why you agree or disagree, suggest alternatives, 
and substitute language for your requested changes.
     Describe any assumptions and provide any technical 
information and/or data that you used.
     If you estimate potential costs or burdens, explain how 
you arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
     Provide specific examples to illustrate your concerns, and 
suggest alternatives.
     Explain your views as clearly as possible, avoiding the 
use of profanity or personal threats.
     Make sure to submit your comments by the comment period 
deadline identified.

C. Where can I get a copy of this document and other related 
information?

    In addition to being available in the docket, an electronic copy of 
this proposal will also be available on the World Wide Web. Following 
signature by the EPA Administrator, a copy of this notice will be 
posted in the regulations and standards section of our NSR home page 
located at http://www.epa.gov/nsr.


D. How can I find information about a possible Public Hearing?

    Persons interested in presenting oral testimony should contact Ms. 
Pamela Long, New Source Review Group, Air Quality Policy Division 
(C504-03), Environmental Protection Agency, Research Triangle Park, NC 
27711; telephone number (919) 541-0641 or e-mail long.pam@epa.gov at 
least 2 days in advance of the public hearing. Persons interested in 
attending the public hearing should also contact Ms. Long to verify the 
time, date, and location of the hearing. The public hearing will 
provide interested parties the opportunity to present data, views, or 
arguments concerning these proposed rules.
    The information presented in this preamble is organized as follows:

I. General Information
    A. Does this action apply to me?
    B. What should I consider as I prepare my comments for EPA?
    C. Where can I get a copy of this document and other related 
information?
    D. How can I find information about a possible Public Hearing?
II. Overview of Proposed Regulations
    A. Summary of Proposed Options for Increments
    B. Summary of Proposed Options for SILs
    C. Summary of Proposed Options for the PM2.5 SMC
III. Background
    A. PSD Program
    B. History of PM NAAQS
    1. TSP and PM10 NAAQS
    2. PM2.5 NAAQS
    3. Revised PM2.5 and PM10 NAAQS
    C. Implementation of NSR for PM2.5
    D. Background on Implementation of PSD Increments

[[Page 54114]]

    E. Historical Approaches for Developing Increments
    1. Congressional Enactment of Increments for PM and 
SO2.
    2. EPA's promulgation of increments for NO2 and 
PM10
    a. Increments for NOX Using the ``Contingent Safe 
Harbor'' Approach Under Section 166(a) of the Act
    b. Increments for PM10 Using ``Equivalent 
Substitution'' Approach Under Section 166(f)
IV. EPA's Interpretation of Section 166 of the Clean Air Act
    A. Which Criteria In Section 166 Should EPA Use to Develop 
Increments for PM2.5?
    1. Support for ``Contingent Safe Harbor'' Approach for 
PM2.5 Under Section 166(a)
    2. Support of ``Equivalent Substitution'' Approach for 
PM2.5 Under Section 166(f)
    B. Requirements of Sections 166(a)-(d) of the Clean Air Act
    1. Regulations as a Whole Should Fulfill Statutory Requirements
    2. Contingent Safe Harbor Approach
    3. The Statutory Factors Applicable Under Section 166(c)
    4. Balancing the Factors Applicable Under Section 166(c)
    5. Authority for States to Adopt Alternatives to Increments
    C. Requirements of Section 166(f) of the Clean Air Act
V. Increments and Other Measures to Prevent Significant 
Deterioration
    A. Option 1--Contingent Safe Harbor Approach for Annual and 
Short-Term Increments--Section 166(a)
    1. Proposed Framework for Pollutant Specific PSD Regulations for 
PM2.5
    a. Increment System
    b. Area Classifications
    c. Permitting Procedures
    d. Air Quality Related Values Review by Federal Land Manager and 
Reviewing Authority
    e. Additional Impacts Analysis
    f. Installation of Best Available Control Technology
    2. Proposed Increments
    a. Identification of Safe Harbor Increments
    b. Data Utilized by EPA for the Evaluation of the Safe Harbor 
Increments for PM2.5
    c. Scope of Effects Considered
    d. Evaluation of the Health and Welfare Effects of 
PM2.5
    e. Fundamental Elements of Increments
    f. Evaluation of the Safe Harbor Increments
    3. Proposed Baseline Dates for PM2.5 Increments Under 
Option 1
    4. Revocation of PM10 Annual Increments
    B. Option 2--Equivalent Substitution Approach for Annual 
Increments--Section 166(f)
    1. Development of Equivalent Increments
    2. Proposed Annual Increments for PM2.5
    a. Option 2A
    b. Option 2B
    3. Baseline dates
VI. Significant Impact Levels (SILs)
    A. EPA's Guidance on SILs in the PSD Program
    B. Legal Basis for SILs
    C. Relationship of SILs to AQRVs
    D. Proposed Options for PM2.5 SILs (for PSD and NA-
NSR)
    1. Option 1. Propose SILs using the approach we proposed for 
PM10 in 1996
    2. Option 2. PM2.5 to PM10 Emissions Ratio
    3. Option 3. PM2.5 to PM10 NAAQS Ratio
VII. Significant Monitoring Concentrations (SMCs)
    A. Background on SMCs
    1. Preconstruction Monitoring and Its Role in NSR Program
    2. History of SMC Rules Adopted by EPA
    B. Legal Basis for SMCs
    C. Proposed Options for PM2.5 SMC
    1. Option 1. Lowest Detectable Concentration
    2. Option 2. PM2.5 to PM10 Emissions Ratio
    3. Option 3. PM2.5 to PM10 NAAQS Ratio
    D. Correction of Cross References
VIII. Effective Date of the Final Rule, SIP Submittal/Approval 
Deadlines and PM10 Revocation Deadline
    A. Option 1: Increments promulgated pursuant to section 166(a) 
of the Act.
    1. Effective Date of Final Rule
    2. State Program
    3. Federal Program
    B. Option 2: Increments Promulgated Pursuant to Section 166(f) 
of the Act.
    1. Effective date of Final Rule
    2. State Program
    3. Federal Program
    C. Revocation of the PM10 Increment
    D. Transition Period
    E. Effective Date for SILs and SMCs
IX. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health & Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect 
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions to Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
X. Statutory Authority

II. Overview of Proposed Regulations

    This proposal is the first step in the rulemaking process for 
promulgating PM2.5 increments, SILs, and a SMC. The purpose 
of this proposed rulemaking is to develop the final elements that will 
aid implementation of the PSD program for PM2.5. When final, 
these elements will supplement the final NSR implementation rule for 
PM2.5. Following final action on this proposal and the 
PM2.5 implementation rule for NSR, the Federal 
PM2.5 NSR programs will no longer have to rely on the 
PM10 program as a surrogate, as has been the practice under 
our existing guidance. A State implementing a NSR program in an EPA 
approved State Implementation Plan (SIP) may continue to rely on the 
interim surrogate policy until we approve a revised SIP addressing 
these requirements. In this rulemaking, we \1\ are proposing several 
options for increments, SILs and the SMC, respectively.
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    \1\ In this proposal, the terms ``we,'' ``us,'' and ``our'' 
refer to the EPA and the terms ``you'' and ``your'' refer to the 
owners or operators of stationary sources of air pollution.
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A. Summary of Proposed Options for Increments

    We are proposing three sets of PM2.5 increments, based 
on several approaches that are described in greater detail later in 
this preamble. For the first set (option 1), we are relying on an 
approach that treats PM2.5 as a new pollutant. This option 
follows our statutory authority section 166(a) of the Act to develop 
increments for ``pollutants for which national ambient air quality 
standards are promulgated after the date of enactment of this part * * 
* '' This is the same approach that we used to establish NOX 
increment regulations on October 12, 2005 (70 FR at 59586). The second 
and third options (options 2A and 2B) rely on an approach that we used 
in 1993 to promulgate PM10 increments in lieu of the 
statutory increments for particulate matter (PM) following our 
replacement of the then existing indicator for the PM NAAQS based on 
total suspended particulate with a new indicator based on 
PM10. (58 FR 31622, June 3, 1993.) These two options 
represent variations of the approach used under the authority of 
section 166(f) of the Act to ``substitute'' PM10 increments 
for TSP increments. The increment values resulting from each of these 
three options are:

[[Page 54115]]



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                                                                                  Proposed increments  ([mu]g/m\3\)                  NAAQS  ([mu]g/m\3\)
                                                                 ---------------------------------------------------------------------------------------
                             Option                                      Class I              Class II              Class III
                                                                 ------------------------------------------------------------------   Annual     24-hr
                                                                    Annual     24-hr      Annual     24-hr      Annual     24-hr
--------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................          1          2          4          9          8         18  .........  .........
2A..............................................................          1          2          4          9          8         18         15         35
2B..............................................................          1          2          5          9         10         18  .........  .........
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B. Summary of Proposed Options for SILs

    We are also proposing three options for SILs. The first option 
utilizes the same approach we proposed for PM10 in the 1996 
NSR Reform proposal. For option 2, we are proposing to scale the 
PM10 SIL values by the ratio of direct PM2.5 to 
direct PM10 emissions. The PM2.5/PM10 
emissions ratio is the national average derived from the 2001 
extrapolation of the 1999 National Emissions Inventory. For option 3, 
we are proposing to scale the PM10 SIL values by the ratio 
of the PM2.5 NAAQS to the PM10 NAAQS. The SIL 
values resulting from each of these options are:

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                                                                   Proposed SILs  ([mu]g/m\3\)
                                               -----------------------------------------------------------------
                    Option                             Class I              Class II              Class III
                                               -----------------------------------------------------------------
                                                  Annual     24-hr      Annual     24-hr      Annual     24-hr
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1.............................................       0.04       0.08        1.0        5.0        1.0        5.0
2.............................................       0.16       0.24        0.8        4.0        0.8        4.0
3.............................................       0.06       0.07        0.3        1.2        0.3        1.2
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C. Summary of Proposed Options for the PM2.5 SMC

    The first option we are proposing for the SMC is the ``Lowest 
Detection Concentration'' or LDC approach that we used for establishing 
the SMC for TSP and PM10. For option 2, we are proposing to 
scale the PM10 SMC value by the ratio of direct 
PM2.5 to direct PM10 emissions. The 
PM2.5/PM10 emissions ratio is the national 
average derived from the 2001 extrapolation of the 1999 National 
Emissions Inventory. For option 3, we are proposing to scale the 
PM10 SMC value by the ratio of the PM2.5 NAAQS to 
the PM10 NAAQS. The proposed SMC values for each of these 
options for the 24-hour averaging period are:

Option 1--10 [mu]g/m\3\
Option 2--7.9 [mu]g/m\3\
Option 3--2.3 [mu]g/m\3\

III. Background

A. PSD Program

    The NSR provisions of the Act are a combination of air quality 
planning and air pollution control technology program requirements for 
new and modified stationary sources of air pollution. In brief, section 
109 of the Act requires us to promulgate primary NAAQS to protect 
public health and secondary NAAQS to protect public welfare. Once we 
have set these standards, States must develop, adopt, and submit to us 
for approval SIPs that contain emission limitations and other control 
measures to attain and maintain the NAAQS and to meet the other 
requirements of section 110(a) of the Act. Part C of title I of the Act 
contains the requirements for a component of the major new source 
review (NSR) program known as the PSD program. This program sets forth 
procedures for the preconstruction review and permitting of new and 
modified major stationary sources of air pollution locating in areas 
meeting the NAAQS (``attainment'' areas) and areas for which there is 
insufficient information to classify an area as either attainment or 
nonattainment (``unclassifiable'' areas). Most states have SIP-approved 
preconstruction permit (major NSR) programs. The Federal PSD program at 
40 CFR 52.21 applies in some States that lack a SIP-approved permit 
program, and in Indian country.\2\ The applicability of the PSD program 
to a major stationary source must be determined in advance of 
construction and is a pollutant specific determination. Once a major 
source is determined to be subject to the PSD program (PSD source), 
among other requirements, it must undertake a series of analyses to 
demonstrate that it will use the best available control technology 
(BACT) and will not cause or contribute to a violation of any NAAQS or 
incremental ambient pollutant concentration increase (increment). In 
cases where the source's emissions may adversely affect an area 
classified as a Class I area, additional review is conducted to protect 
the increments and special attributes of such an area defined as ``air 
quality related values.''
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    \2\ We have delegated authority to some States to implement the 
Federal PSD program. The EPA remains the reviewing authority in non-
delegated States and in Indian country.
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    As part of the analysis of air quality impacts to determine 
compliance with the NAAQS and increment, the permit applicant and 
reviewing authority may compare the source's impacts for a pollutant 
with the corresponding SIL for that pollutant to show that a cumulative 
air quality impacts analysis is not necessary. Similarly, the permit 
applicant and reviewing authority may use the corresponding SMC for 
that pollutant to determine if pre-application site-specific ambient 
monitoring data is needed to conduct the air quality analysis.
    When the reviewing authority reaches a preliminary decision to 
authorize construction of each proposed major new source or major 
modification, it must provide notice of the preliminary decision and an 
opportunity for comment by the general public, industry, and other 
persons that may be affected by the emissions of the major source or 
major modification. After considering these comments, the reviewing 
authority may issue a final determination on the construction permit in 
accordance with the PSD regulations.

[[Page 54116]]

B. History of PM NAAQS

1. TSP and PM10 NAAQS
    The EPA initially established NAAQS for PM in 1971, measured by the 
TSP indicator. Based on the size of the particles collected by the 
``high-volume sampler,'' which was the reference method for determining 
ambient concentrations, TSP included all PM up to a nominal size of 25 
to 45 micrometers. We established both annual and 24-hour NAAQS for 
TSP.
    On July 1, 1987, we promulgated new NAAQS for PM in which we 
changed the indicator from TSP to PM10, the latter including 
particles with a mean aerodynamic diameter less than or equal to 10 
micrometers. These smaller particles are the subset of inhalable 
particles small enough to penetrate to the thoracic region (including 
the tracheobronchial and alveolar regions) of the respiratory tract 
(referred to as thoracic particles). We established annual and 24-hour 
NAAQS for PM10, and revoked the NAAQS for TSP. (52 FR 
24634).
2. PM2.5 NAAQS
    On July 18, 1997, we again revised the NAAQS for PM in several 
respects. While we determined that the NAAQS should continue to focus 
on particles less than or equal to 10 micrometers in diameter, we also 
determined that the fine and coarse fractions of PM10 should 
be considered separately. We established new annual and 24-hour NAAQS 
for PM2.5 (referring to particles with a nominal mean 
aerodynamic diameter less than or equal to 2.5 micrometers) as the 
indicator for fine particles. Our 1997 rules also modified the 
PM10 NAAQS for the purpose of regulating the coarse fraction 
of PM10 (referred to as thoracic coarse particles or coarse-
fraction particles; generally including particles with a nominal mean 
aerodynamic diameter greater than 2.5 micrometers and less than or 
equal to 10 micrometers, or PM10-2.5), however 
this part of the action was vacated during subsequent litigation, 
leaving the pre-existing 1987 PM10 NAAQS in place (62 FR 
38652).
3. Revised PM2.5 and PM10 NAAQS
    On October 17, 2006, we promulgated revisions to the NAAQS for 
PM2.5 and PM10 with an effective date of December 
18, 2006 (71 FR 61144). We lowered the 24-hour NAAQS for 
PM2.5 from 65 micrograms per cubic meter ([mu]g/m\3\) to 35 
[mu]g/m\3\, and retained the existing annual PM2.5 NAAQS of 
15 [mu]g/m\3\. In addition, we retained the existing PM10 
24-hour NAAQS of 150 [mu]g/m\3\, and revoked the annual PM10 
NAAQS (previously set at 50 [mu]g/m\3\).

C. Implementation of NSR for PM2.5

    After we established new annual and 24-hour NAAQS for 
PM2.5 (referring to particles with a nominal mean 
aerodynamic diameter less than or equal to 2.5 micrometers) as the 
indicator for fine particles in July 1997, we issued a guidance 
document ``Interim Implementation for the New Source Review 
Requirements for PM2.5,'' John S. Seitz, Director, Office of 
Air Quality Planning and Standards, EPA, October 23, 1997. As noted in 
that guidance, section 165 of the Act implies that PSD requirements 
become effective for a new NAAQS upon the effective date of the NAAQS. 
Section 165(a)(1) of the Act provides that no new or modified major 
source may be constructed without a PSD permit that meets all of the 
section 165(a) requirements with respect to the regulated pollutant. 
Moreover, section 165(a)(3) provides that the emissions from any such 
source may not cause or contribute to a violation of any increment or 
NAAQS. Also, section 165(a)(4) requires BACT for each pollutant subject 
to PSD regulation. The 1997 guidance stated that sources would be 
allowed to use implementation of a PM10 program as a 
surrogate for meeting PM2.5 NSR requirements until certain 
difficulties were resolved. These difficulties included the lack of 
necessary tools to calculate the emissions of PM2.5 and 
related precursors, the lack of adequate modeling techniques to project 
ambient impacts, and the lack of PM2.5 monitoring sites.
    On April 5, 2005, we issued a guidance document entitled 
``Implementation of New Source Review Requirements in PM-2.5 
Nonattainment Areas,'' Stephen D. Page, Director, Office of Air Quality 
Planning and Standards, EPA. This memorandum provides guidance on the 
implementation of the nonattainment major NSR provisions in 
PM2.5 nonattainment areas in the interim period between the 
effective date of the PM2.5 NAAQS designations (April 5, 
2005) and when we promulgate regulations to implement nonattainment 
major NSR for the PM2.5 NAAQS. In addition to affirming the 
continued use of the John S. Seitz guidance memo in PM2.5 
attainment areas, this memo recommends that until we promulgate the 
PM2.5 major NSR regulations, States should use a 
PM10 nonattainment major NSR program as a surrogate to 
address the requirements of nonattainment major NSR for the 
PM2.5 NAAQS.
    On November 1, 2005, we proposed a rule to implement the 
PM2.5 NAAQS, including proposed revisions to the NSR 
program. For those States with EPA-approved PSD programs, we proposed 
to continue the 1997 NSR guidance to use PM10 as a surrogate 
for PM2.5, but only during the SIP development period. We 
also indicate in that proposal that we will develop increments, SILs, 
and SMC in a separate rulemaking--i.e. this proposed rulemaking. Since 
there was an interim surrogate NSR program in place, EPA decided to 
first promulgate the non-NSR part of the implementation rule (including 
attainment demonstrations, designations, control measures etc.)--which 
was promulgated on April 25, 2007. The NSR part of the implementation 
rule is anticipated to be promulgated in September 2007. Additionally, 
once this proposed rulemaking is finalized, States will be able to 
fully implement a PM2.5 NSR program.

D. Background on Implementation of PSD Increments

    Under section 165(a)(3) of the Act, a PSD permit applicant must 
demonstrate that emissions from the proposed construction and operation 
of a facility ``will not cause, or contribute to, air pollution in 
excess of any (A) maximum allowable increase or maximum allowable 
concentration for any pollutant. * * *'' 42 U.S.C. 7475(a)(3). The 
``maximum allowable increase'' of an air pollutant that is allowed to 
occur above the applicable baseline concentration for that pollutant is 
known as the PSD increment. By establishing the maximum allowable level 
of ambient pollutant concentration increase in a particular area, an 
increment defines ``significant deterioration.''
    For PSD baseline purposes, a baseline area for a particular 
pollutant emitted from a source includes the attainment or 
unclassifiable area in which the source is located as well as any other 
attainment or unclassifiable area in which the source's emissions of 
that pollutant are projected (by air quality modeling) to result in an 
ambient pollutant increase of at least 1 [mu]g/m\3\ (annual average). 
See, e.g., 40 CFR 52.21(b)(15)(i). Once the baseline area is 
established, subsequent PSD sources locating in that area need to 
consider that a portion of the available increment may have already 
been consumed by previous emissions increases.
    In general, the submittal date of the first complete PSD permit 
application in a particular area is the operative

[[Page 54117]]

``baseline date.'' \3\ On or before the date of the first complete PSD 
application, emissions generally are considered to be part of the 
baseline concentration, except for certain emissions from major 
stationary sources, as explained in the following discussion of 
baseline dates. Most emissions increases that occur after the baseline 
date will be counted toward the amount of increment consumed. 
Similarly, emissions decreases after the baseline date restore or 
expand the amount of increment that is available.
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    \3\ Baseline dates are pollutant specific. That is, a complete 
PSD application establishes the baseline date only for those 
regulated NSR pollutants that are projected to be emitted in 
significant amounts (as defined in the regulations) by the 
applicant's new source or modification. Thus, an area may have 
different baseline dates for different pollutants.
---------------------------------------------------------------------------

    In practice, three dates related to the PSD baseline concept are 
important in understanding how to calculate the amount of increment 
consumed--(1) Trigger date; (2) minor source baseline date; and (3) 
major source baseline date. Chronologically, the first relevant date is 
the trigger date. The trigger date, as the name implies, triggers the 
overall increment consumption process nationwide. Specifically, this is 
a fixed date, which must occur before the minor source baseline date 
can be established for the pollutant-specific increment in a particular 
attainment area. See, e.g., 40 CFR 52.21(b)(14)(ii). For PM and 
SO2, Congress defined the applicable trigger date as August 
7, 1977--the date of the 1977 amendments to the Act when the original 
statutory increments were established by Congress. For NO2, 
we selected the trigger date as February 8, 1988--the date on which we 
proposed increments for NO2. See 53 FR 40656, 40658; October 
17, 1988. In this action, as described later, we are proposing to add a 
new trigger date for purposes of calculating the new PM2.5 
increments.
    The two remaining dates--``minor source baseline date'' and ``major 
source baseline date''--as described later, are necessary to properly 
account for the emissions that are to be counted toward increment 
consumed following the national trigger date, in accordance with the 
statutory definition of ``baseline concentration'' in section 169(4) of 
the Act. The statutory definition provides that the baseline 
concentration of a pollutant for a particular baseline area is 
generally the air quality at the time of the first application for a 
PSD permit in the area. Consequently, any increases in actual emissions 
occurring after that date (with some possible exceptions that we will 
discuss later) would be considered to consume the applicable PSD 
increment. However, the statutory definition in section 169(4) also 
provides that ``[E]missions of sulfur oxides and particulate matter 
from any major emitting facility on which construction commenced after 
January 6, 1975 shall not be included in the baseline and shall be 
counted in pollutant concentrations established under this part.''
    To make this distinction between the date when emissions changes in 
general (i.e., from both major and minor sources) affect the increment 
and the date when emissions resulting from the construction at a major 
stationary source consume the increment, we established the terms 
``minor source baseline date'' and ``major source baseline date,'' 
respectively. See 40 CFR 51.166(b)(14) and 52.21(b)(14). Accordingly, 
the ``minor source baseline date'' is the date on which the first 
complete application for a PSD permit is filed in a particular area. 
Any change in actual emissions after that date affects the PSD 
increment for that area.
    The ``major source baseline date'' is the date after which actual 
emissions increases associated with construction at any major 
stationary source affect the PSD increment. In accordance with the 
statutory definition of ``baseline concentration,'' the PSD regulations 
define a fixed date to represent the major source baseline date for 
each pollutant for which an increment exists. Congress defined the 
major source baseline date for the statutory increments for PM and 
SO2 as January 6, 1975. For the NO2 increments, 
which we promulgated in 1988 under our authority to establish an 
increment system under section 166(a) of the Act, the major source 
baseline date we selected is February 8, 1988--the date on which we 
proposed increments for NO2. 53 FR 40656. In this action, as 
described later, we are proposing to add a new major source baseline 
date for PM2.5.
    The PSD regulations set out the third date that is relevant to the 
PSD baseline concept. These regulations provide that the earliest date 
on which the minor source baseline date can be established is the date 
immediately following the ``trigger date'' for the pollutant-specific 
increment. See, e.g., 40 CFR 52.21(b)(14)(ii). For PM and 
SO2, Congress defined the applicable trigger date as August 
7, 1977--the date of the 1977 amendments to the Act when the original 
statutory increments were established by Congress. For NO2, 
we selected the trigger date as February 8, 1988--the date on which we 
proposed increments for NO2. See 53 FR 40656, 40658; October 
17, 1988.
    Once the minor source baseline date associated with the first PSD 
permit application for a proposed new major stationary source or major 
modification in an area is established, the new emissions from that 
source consume a portion of the increment in that area, as do any 
subsequent actual emissions increases that occur from any new or 
existing source in the area. When the maximum pollutant concentration 
increase defined by the increment has been reached, additional PSD 
permits cannot be issued until sufficient amounts of the increment are 
``freed up'' via emissions reductions that may occur voluntarily, e.g., 
via source shutdowns, or via control requirements imposed by the 
reviewing authority. Moreover, the air quality in a region cannot 
deteriorate to a level in excess of the applicable NAAQS, even if all 
the increment has not been consumed. Therefore, new or modified sources 
located in areas where the air pollutant concentration is near the 
level allowed by the NAAQS may not have full use of the amount of 
pollutant concentration increase allowed by the increment.
    Under EPA guidance, the actual increment analysis that a proposed 
new or modified source undergoing PSD review must complete depends on 
the area impacted by the source's new emissions.\4\ We have also 
provided approved air quality models and guidelines for sources to use 
to project the air quality impact of each pollutant (over each 
averaging period) for which an increment analysis must be done.\5\ In 
addition, we established significant impact levels for each pollutant 
under the nonattainment major NSR program that have also been used 
under the PSD program to identify levels below which the source's 
modeled impact is regarded as de minimis. See 40 CFR 51.165(b) and part 
51, appendix S, section III.A. In the event that a source's modeled 
impacts of a particular pollutant are below the applicable significant 
impact level at all ambient air locations modeled, i.e., de minimis 
everywhere, EPA policy provides that no further modeling analysis is 
required for that pollutant. Our policy is that when a preliminary 
screening analysis based on the significant impact level is sufficient 
to demonstrate that the source's

[[Page 54118]]

emissions will not cause or contribute to a violation of the increment, 
there is no need for a full impacts analysis involving a cumulative 
evaluation of the emissions from the proposed source and other sources 
affecting the area.
---------------------------------------------------------------------------

    \4\ We note that on June 6, 2007, we published a notice of 
proposed rulemaking proposing to refine several aspects of the 
increment calculation process to clarify how States and regulated 
sources may calculate increases in pollutant concentrations for 
purposes of determining compliance with the PSD increments. See 72 
FR at 31372. When final, these revisions will amend the PSD 
regulations at 40 CFR 51.166 and 52.21.
    \5\ See EPA's ``Guideline on Air Quality Models'' at 40 CFR part 
51, appendix W.
---------------------------------------------------------------------------

    Within the impact area of a source that does have a significant 
impact, increment consumption is calculated using the source's proposed 
emissions increase, along with other emissions increases or decreases 
of the particular pollutant from sources in the area, which have 
occurred since the minor source baseline date established for that 
area. (For major sources, emissions increases or decreases that have 
occurred since the major source baseline date consume or expand 
increment.) Thus, an emissions inventory of sources whose emissions 
consume or expand the available increment in the area must be compiled. 
The inventory includes not only sources located directly in the impact 
area, but sources outside the impact area that affect the air quality 
within the impact area.
    The inventory of emissions includes emissions from increment-
affecting sources at two separate time periods--the baseline date and 
the current period of time. For each source that was in existence on 
the relevant baseline date (major source or minor source), the 
inventory includes the source's actual emissions on the baseline date 
and its current actual emissions. The change in emissions over these 
time periods represents the emissions that consume increment (or, if 
emissions have gone down, expand the available increment). For sources 
constructed since the relevant baseline date, all their current actual 
emissions consume increment and are included in the inventory.
    When the inventory of emissions has been compiled, computer 
modeling is used to determine the change in ambient concentration that 
will result from these emissions when combined with the proposed 
emissions increase from the new major source or major modification that 
is undergoing PSD review. The modeling has generally been guided by the 
``Guideline on Air Quality Models'' (40 CFR part 51, appendix W), which 
includes provisions on air quality models and the meteorological data 
input into these models. The model output (expressed as a change in 
concentration) for each relevant averaging period is then compared to 
the corresponding allowable PSD increment.

E. Historical Approaches for Developing Increments

1. Congressional Enactment of Increments for PM and SO2
    Congress established the first increments defining significant 
deterioration of air quality in the 1977 Amendments to the Act. These 
amendments to the Act, among other things, added subpart C to title I, 
setting out the requirements for PSD. In section 163, Congress included 
numerical increments for PM and sulfur dioxide (SO2) for 
Class I, II, and III areas.
    The three area classes are part of the increment system originally 
established by Congress. Congress designated Class I areas (including 
certain national parks and wilderness areas) as areas of special 
national concern, where the need to prevent deterioration of air 
quality is the greatest. Consequently, the allowable level of 
incremental change is the smallest relative to the other area classes, 
i.e., most stringent, in Class I areas. The increments of Class II 
areas are larger than those of Class I areas and allow for a moderate 
degree of emissions growth. For future redesignation purposes, Congress 
defined as Class III any existing Class II area for which a State may 
desire to promote a higher level of industrial development (and 
emissions growth). Thus, Class III areas are allowed to have the 
greatest amount of pollutant increase of the three area classes while 
still achieving the NAAQS. There have been no Class III redesignations 
to date.
    In establishing these PSD increments, Congress used the then-
existing NAAQS for those pollutants as the benchmark for determining 
what constitutes ``significant deterioration.'' Congress established 
the increments for PM as a percentage of the then-existing PM NAAQS. At 
the time the Act was amended in 1977, the NAAQS for PM were expressed 
in terms of ambient concentrations of total suspended particulate 
(TSP). Thus, EPA interpreted the statutory increments for PM using the 
same ambient ``indicator.''
2. EPA's Promulgation of Increments for NO2 and 
PM10
    Congress also provided authority for EPA to promulgate additional 
increments and to update the original PM increments created by statute. 
The EPA has promulgated two regulations pursuant to this authority.
a. Increments for NOX Using the ``Contingent Safe Harbor'' 
Approach Under Section 166(a) of the Act
    As enacted in 1977, subpart C of the Act also included sections 
166(a) through 166(e), which set out requirements related to increments 
for other pollutants. Section 166(a) requires EPA to develop 
regulations to prevent the significant deterioration of air quality due 
to emissions of certain named pollutants, and to develop such 
regulations for any pollutants for which NAAQS are subsequently 
promulgated. Section 166(b) prescribes timelines for the effective date 
of such regulations, and for corresponding SIP submittals and EPA 
approvals. Specifically, regulations, including increments, developed 
pursuant to section 166(a) become effective 1 year after the date of 
promulgation, and State plan revisions containing the new regulations 
are to be submitted to EPA for review within 21 months of promulgation. 
The same provision then calls for EPA's approval or disapproval of the 
revised plan within 25 months of promulgation. The legislative history 
indicates that this 1-year delay before the new PSD requirements, 
including the new increments, become effective is to allow Congress an 
opportunity to review them before States are required to implement 
them. H.R. Conf. Rep. 95-564, at 151 (1977), 1977 U.S.C.C.A.N. 1502, 
1532. Section 166(c) and (d) set forth criteria and goals that such 
regulations must meet.
    Based on section 166 of the Act, on October 17, 1988, EPA 
promulgated increments for nitrogen dioxide (NO2) to prevent 
significant deterioration of air quality due to emissions of 
NOX (53 FR 40656). The EPA based these increments on 
percentages of the NAAQS in the same way that Congress derived the 
statutory increments for PM and SO2. Those NO2 
increments were challenged in 1988 by the Environmental Defense Fund 
(now Environmental Defense, or ``ED'') when ED filed suit in the U.S. 
Court of Appeals for the District of Columbia Circuit against the 
Administrator (Environmental Defense Fund, Inc. v. Reilly, No. 88-
1882). Environmental Defense successfully argued that we failed to 
sufficiently consider certain provisions in section 166 of the Act. The 
court remanded the case to EPA ``to develop an interpretation of 
section 166 that considers both subsections (c) and (d), and if 
necessary to take new evidence and modify the regulations.'' See 
Environmental Defense Fund v. EPA, 898 F.2d 183, 190 (D.C. Cir. 1990). 
Section 166(c) of the Act requires the PSD regulations to, among other 
things, meet the goals and purposes set forth in sections 101 and 160 
of the Act. Section 166(d) requires these regulations be at least as 
effective as the increments

[[Page 54119]]

established for PM (in the form of TSP) and SO2 in section 
163 of the Act. The court considered the NO2 increment 
values determined using the percentage-of-NAAQS approach as ``safe 
harbor'' increments which met the requirements of section 166(d) of the 
Act. However, the court also determined that EPA's reliance on such 
increment levels was contingent upon our completing the analyses 
required under section 166(c), which provided that the final increment 
values must address the goals of sections 101 and 160 of the Act to 
protect public health and welfare, parks, and air quality related 
values (AQRVs) \6\ and to ensure economic growth.
---------------------------------------------------------------------------

    \6\ The term ``air quality related values'' is not defined in 
the Act, but the legislative history provides that ``The term `air 
quality related values' of Federal lands designated as class I 
includes the fundamental purposes for which such lands have been 
established and preserved by the Congress and the responsible 
Federal agency. For example, under the 1916 Organic Act to establish 
the National Park Service (16 U.S.C. 1), the purpose of such 
national park lands `is to conserve the scenery and the natural and 
historic objects and the wildlife therein and to provide for the 
enjoyment of the same in such manner and by such means as will leave 
them unimpaired for the enjoyment of future generations.' '' S. Rep. 
No. 95-127 at 36 (1977)
---------------------------------------------------------------------------

    In response to the court's decision, we proposed rulemaking on 
increments for NOX on February 23, 2005 (70 FR 8880) and 
finalized the rule on October 12, 2005 (70 FR 59582). In the final 
rule, we established our policy on how to interpret and apply the 
requirements of sections 166(c) and (d) of the Act. In accordance with 
the court ruling, we conducted further analyses (considering the health 
and welfare effects of NOX) and concluded that the existing 
NO2 increments were adequate to fulfill the requirements of 
section 166(c). See 70 FR 59586 for our detailed analysis of how 
pollutant regulations satisfy the requirements of section 166 of the 
Act. Hence, we retained the existing NO2 increments along 
with other parts of the existing framework of pollutant-specific PSD 
regulations for NOX. We also amended the requirements of 40 
CFR 51.166 to make it clear that States may seek EPA approval of SIPs 
that utilize a different approach than EPA used to establish these 
NO2 increments. To receive our approval of an alternative 
program, a State must demonstrate that its program satisfies the 
requirements of sections 166(c) and 166(d) of the Act and prevents 
significant deterioration of air quality from emissions of 
NOX.\7\
---------------------------------------------------------------------------

    \7\ Under the 2005 NOX regulation, States can adopt 
measures other than increments as long as they can demonstrate that 
the measures selected comply with the same criteria and goals of 166 
(c) and (d) of the Act that must be met for increments.
---------------------------------------------------------------------------

b. Increments for PM10 Using ``Equivalent Substitution'' 
Approach Under Section 166(f)
    On October 5, 1989, we proposed new PM10 increments. See 
54 FR 41218. Although section 163 did not expressly define the existing 
statutory increments for PM in terms of a specific indicator, EPA 
reasoned that Congress's knowledge that TSP was the indicator for the 
PM NAAQS, and that the TSP standards were the starting point for the 
increments levels when the increments were established in 1977, meant 
that TSP was also the appropriate measure for the PM increments in 
section 163. As a consequence, EPA believed that the statutory PM 
increments could not simply be administratively redefined as 
PM10 increments, retaining the same numerical values, 
following the revision of the PM NAAQS. Rather, we stated our belief 
that with the promulgation of the PM10 NAAQS, EPA had both 
the responsibility and the authority under sections 166 and 301 of the 
Act to promulgate new increments for PM to be measured in terms of 
PM10. We further concluded that promulgating PM10 
increments to replace, rather than supplement, the statutory TSP 
increments under section 163 represented the most sensible approach for 
preventing significant deterioration with respect to PM. See 54 FR 
41220-41221.
    We promulgated PM10 increments to replace the existing 
TSP increments on June 3, 1993 (58 FR 31622). In the interim between 
proposal and promulgation, Congress enacted the 1990 Act Amendments. As 
part of these Act Amendments, Congress amended section 166 to add a new 
section 166(f). This section specifically authorized EPA to substitute 
PM10 increments for the existing section 163 PM increments 
based on TSP, provided that the substituted increments are ``of equal 
stringency in effect'' as the section 163 increments.
    Thus, we were able to replace the TSP increments under section 163 
of the Act using PM10 increments based directly on the newly 
enacted authority under section 166(f) of the Act. In the 
PM10 rule, we maintained the existing baseline dates and 
baseline areas for PM that had been previously established using the 
TSP indicator. Also as proposed, we promulgated PM10 
increments developed based on an approach we called the ``equivalent to 
statutory increments'' approach. Under this approach, we used the 
original TSP increments as a benchmark for calculating the 
PM10 increments, thereby retaining roughly the same 
limitations on future deterioration of air quality as was allowed under 
the TSP increments. In using this approach, we considered the 
historical consumption of TSP increment by a sample population of 
permitted PSD sources, and then determined the PM10 
increments for each area classification and averaging time that would 
provide approximately the same percentage of PM10 increment 
consumption, on average, by the same population of sources. Then, all 
future calculations of increment consumption after the PM10 
implementation date would be based on PM10 emissions. See 58 
FR 31622 and 31625.

IV. EPA'S Interpretation of Section 166 of the Clean Air Act

A. Which Criteria in Section 166 Should EPA Use to Develop Increments 
for PM2.5?

    The EPA interprets section 166 of the Act to give the Administrator 
the discretion to use either the ``contingent safe harbor'' approach or 
the ``equivalent substitution'' approach to establish increments for 
PM2.5. Since sections 166(a) and section 166(f) contain or 
incorporate different criteria for establishing PSD regulations 
containing increments or other measures, the interpretation that EPA 
chooses to follow could have an impact on the increments or other 
measures that EPA adopts. Regulations promulgated under section 166(a) 
must be based on the criteria in section 166(c) and 166(d). 42 U.S.C. 
7476(c)-(d). Regulations promulgated under section 166(f) must ``be of 
equal stringency in effect as those specific in the provisions for 
which they are substituted.'' 42 U.S.C. 7476(f). Furthermore, section 
166(a) calls broadly for regulations, which may include increments, 
whereas section 166(f) addresses only increments.
    Section 166(a) provides authority for EPA to promulgate additional 
pollutant-specific PSD regulations, which may include increments, for 
the pollutants specifically identified in that provision plus 
additional pollutants for which EPA may promulgate a NAAQS after a 
specific date 42 U.S.C. 7476(a). The last sentence of section 166(a) 
provides the following:

    In the case of pollutants for which national ambient air quality 
standards are promulgated after August 7, 1977, [the Administrator] 
shall promulgate such regulations not more than 2 years after the 
date of promulgation of such standards.

Since EPA promulgated an additional NAAQS for PM, based on the 
PM2.5 indicator, in 1997, one potential

[[Page 54120]]

approach for developing increments for PM2.5 is for EPA to 
promulgate these increments under the authority of section 166(a). 
Under this approach, EPA would promulgate increments or other measures 
for PM2.5 that satisfy the standards set forth in 
subsections (c) and (d) of section 166, as interpreted by EPA in our 
recent rulemaking for nitrogen oxides.
    However, in light of the provisions in section 163 and 166(f) of 
the Act that address increments for TSP and PM10, 
respectively, there is some ambiguity on the question of the legal 
authority EPA should rely upon to establish increments for 
PM2.5. In 1993, EPA construed section 166(f) to establish 
the sole criteria for promulgation of a new PM increment and thus did 
not base our final PM10 increment on section 166(a) of the 
Act. Considering sections 163, 166(a), and 166(f) together, an 
alternative interpretation of these provisions might be that Congress 
intended that section 163 and 166(f) alone cover PM. Under this 
reading, EPA would promulgate additional increments for particular 
matter based on the section 163 increments and 166(f) of the Act, which 
are the only provisions that specifically mention PM and PSD 
increments. However, as discussed later, it may also be possible to 
read sections 166(a) and 166(f) in harmony. Thus, we propose to adopt 
one of the following legal theories to support promulgation of 
increments for PM2.5 using either of the two methods that 
EPA used in prior rules to develop PSD increments.
1. Support for ``Contingent Safe Harbor'' Approach for PM2.5 
Under Section 166(a)
    The EPA believes it is permissible to interpret section 166(a) to 
apply to PM2.5. Although EPA has generally characterized the 
NAAQS for PM2.5 as a NAAQS for a new indicator of PM, EPA 
did not replace the PM10 NAAQS with the NAAQS for 
PM2.5 in 1997. Rather, EPA established an additional NAAQS 
for PM2.5 as if it were a new pollutant, even though EPA had 
already developed air quality criteria for PM generally. Thus, for 
purposes of section 166(a), the addition of a NAAQS for 
PM2.5 is functionally the same as establishing a NAAQS for 
an additional pollutant after 1977.
    We read section 166(a) to authorize EPA to promulgate pollutant-
specific PSD regulations meeting the requirements of sections 166(c) 
and 166(d) for any pollutant for which EPA promulgates a NAAQS after 
1977. Most of the pollutants identified in section 166(a) (nitrogen 
oxides, photochemical oxidants, carbon monoxide) are pollutants for 
which EPA had established NAAQS in 1977 when Congress adopted section 
166 of the Act. There was no need for Congress to list other criteria 
pollutants, sulfur dioxide and particular matter, in section 166(a) 
because Congress had already established increments for these 
pollutants in section 163 of the Act. In addition to requiring 
regulations for the enumerated pollutants, Congress clearly intended to 
authorize EPA to establish additional pollutant-specific PSD 
regulations, potentially containing increments, for any additional 
pollutants for which EPA promulgated a NAAQS under section 109 of the 
Act. Furthermore, because the Act refers to pollutants for which EPA 
promulgates NAAQS after 1977, and does not use the phrase ``additional 
pollutants'' we believe that Section 166(a) provides authority for EPA 
to promulgate new increments after revising an existing NAAQS 
(including one first promulgated before 1977), when we find that such 
action is appropriate.
    In our 1989 proposal on the PM10 increments, EPA 
construed section 166(a) to apply to PM10, even though EPA 
regarded PM10 to be a new indicator for PM. 58 FR 31623-24. 
Thus, before the adoption of section 166(f), EPA read the language of 
section 166(a) to apply to the promulgation of increments using a new 
indicator for PM and did not limit the application of section 166(a) to 
wholly new criteria pollutants. Similarly, in the current proposal, EPA 
believes it can continue to interpret section 166(a) to apply to the 
promulgation of an additional increment for a new indicator of an 
existing criteria pollutant since EPA promulgated a NAAQS for a new 
indicator of that pollutant after 1977.
    Although EPA ultimately applied the standard in section 166(f) as 
the sole basis for our PM10 increments in 1993, that 
provision does not necessarily govern the situation EPA currently faces 
with PM2.5. One could read section 166(f) to address only 
EPA's authority to substitute new PM increments for the 
congressionally-established increments for TSP rather than the distinct 
issue now faced by EPA concerning the promulgation of additional PM 
increments for PM2.5 without necessarily revoking existing 
increments. Furthermore, the language in section 166(f) could be read 
to limit the scope of this provision to only increments using the 
PM10 indicator. Thus, section 166(f) may not necessarily be 
applicable to the substitution of PM10 increments with 
PM2.5 increments.
    The EPA believes that section 166(a) could apply to the adoption of 
new increments, without the revocation of existing increments. As 
reflected in the 2005 increments rule for NOX and the court 
decision in EDF v. EPA, when sections 166(a)-(d) apply, EPA is 
obligated to evaluate which indicator or form should be used in our 
pollutant-specific PSD regulations to meet these requirements in the 
Act. Based on this interpretation, we are proposing to use a contingent 
safe harbor approach (option 1) that involves first deriving increment 
values based on percentage of the NAAQS and then evaluating whether 
alternative increments or additional measures are necessary to meet the 
criteria in section 166(c).
2. Support of ``Equivalent Substitution'' Approach for PM2.5 
Under Section 166(f)
    The EPA believes it is also permissible for the Agency to construe 
section 166(f) as a continuing grant of authority for the Administrator 
to update the increments for particular matter whenever the 
Administrator decides to adopt a new form of particular matter as the 
indicator for the NAAQS. Although the terms of section 166(f) of the 
Act appear to address PM10 alone, the overall intent of this 
provision was to clarify that EPA had the authority to update the 
original TSP increments to reflect changes in the NAAQS indicator. 
Language describing the PM10 indicator was used in the Act 
because this was the indicator for PM that EPA was seeking to 
incorporate into the PSD program at the time of the 1990 Amendments 
when section 166(f) was adopted. However, we believe it is reasonable 
to conclude that Congress intended to authorize EPA to continue 
updating the particular matter increments contained in section 163 if 
EPA promulgated a NAAQS for another appropriate indicator for 
particular matter.
    We believe EPA is authorized to promulgate increments for 
PM2.5 as a substitute for the PM10 increments, as 
well as the original TSP increments, so long as the new increments for 
PM2.5 are of ``equal stringency in effect as those specified 
in the provisions for which they are substituted.'' 42 U.S.C. 7476(f). 
Based on this interpretation, we propose two approaches (options 2A and 
2B discussed later) for developing PM2.5 increments that 
would meet the ``equal stringency in effect'' standard contained in 
section 166(f).
    While we believe section 166(f) may be construed to provide 
continuing authority to ``update'' the increments for PM to conform to 
the NAAQS, section

[[Page 54121]]

166(f) describes a process in which EPA would ``substitute'' one PM 
increment for another. The language in section 166(f) does not address 
whether EPA may adopt additional increments for other PM indicators 
while retaining the existing PM increments. In contrast, section 166(a) 
does contain language addressing the promulgation of PSD regulations 
when EPA adds to the suite of NAAQS. Thus, we construe section 166(a) 
to have the closest connection to the task of adding, rather than the 
substituting or replacing, PSD increments for PM. As a result, for 
purposes of establishing the proposed 24-hour PM2.5 
increments, we propose only one option--using the contingent safe 
harbor approach described in option 1--because we are not proposing to 
replace the existing 24-hour PM10 increment with a new 24-
hour PM2.5 increment, since we have retained the 24-hour 
PM10 NAAQS. However, we also seek comment on whether we 
could rely on section 166(f) to promulgate the 24-hour PM2.5 
increments using the same methodology as for the annual PM2.5 
increments described later, even though the 24-hour PM10 
NAAQS is not being revoked.

B. Requirements of Sections 166(a)-(d) of the Clean Air Act

    If we determine that section 166(a) applies to PM2.5, we 
propose to follow the interpretation of sections 166(a)-(d) that we 
adopted in our most recent increments rule for NOX. This 
interpretation was upheld in a recent court decision E.D. v. EPA, No. 
05-1446 (June 19, 2007 DC Cir.). We summarize the key elements of this 
interpretation later, but a more detailed discussion can be found in 
our October 2005 final rule for NOX. 70 FR 59582.
    In section 166(a) of the Act, Congress directed EPA to develop 
pollutant-specific regulations to prevent significant deterioration of 
air quality. Congress further specified that such regulations meet the 
following requirements set forth in sections 166(c) and 166(d):

    (c) Such regulations shall provide specific numerical measures 
against which permit applications may be evaluated, a framework for 
stimulating improved control technology, protection of air quality 
values, and fulfill the goals and purposes set forth in section 101 
and section 160.
    (d) The regulations * * * shall provide specific measures at 
least as effective as the increments established in section 163 [for 
SO2 and PM] to fulfill such goals and purposes, and may 
contain air quality increments, emission density requirements, or 
other measures.

    The goals and purposes of the PSD program set forth in section 160 
are as follows:

    (1) To protect public health and welfare from any actual or 
potential adverse effect which in the Administrator's judgment may 
reasonably be anticipate[d] to occur from air pollution or from 
exposures to pollutants in other media, which pollutants originate 
as emissions to the ambient air, notwithstanding attainment and 
maintenance of all national ambient air quality standards;
    (2) To preserve, protect, and enhance the air quality in 
national parks, national wilderness areas, national monuments, 
national seashores, and other areas of special national or regional 
natural, recreational, scenic, or historic value;
    (3) To insure that economic growth will occur in a manner 
consistent with the preservation of existing clean air resources;
    (4) To assure that emissions from any source in any State will 
not interfere with any portion of the applicable implementation plan 
to prevent significant deterioration of air quality for any other 
State; and
    (5) To assure that any decision to permit increased air 
pollution in any area to which this section applies is made only 
after careful evaluation of all the consequences of such a decision 
and after adequate procedural opportunities for informed public 
participation in the decisionmaking process.

    As described in our 2005 rule for NOX, EPA's 
interpretation of these provisions is grounded on five central 
elements. First, we read section 166 of the Act to direct EPA to 
conduct a holistic analysis that considers how a complete system of 
regulations will collectively satisfy the applicable criteria, rather 
than evaluating one individual part of a regulatory scheme in 
isolation. Second, we use a ``contingent safe harbor'' approach which 
calls for EPA to first establish the minimum level of effectiveness 
necessary to satisfy section 166(d) and then to conduct further 
analysis to determine if additional measures are necessary to fulfill 
the requirements of section 166(c). Third, we interpreted section 
166(c) of the Act to identify eight statutory factors that EPA must 
apply when promulgating pollutant-specific regulations to prevent 
significant deterioration of air quality. Fourth, we interpreted the 
requirements to simultaneously satisfy each of these factors to 
establish a balancing test in cases where certain objectives may be at 
odds with each other. Fifth, we recognized that the requirements of 
section 166 may be satisfied by adopting other measures besides an 
increment and that EPA may allow States to demonstrate that 
alternatives to an increment contained in a SIP meet the requirements 
of sections 166(c) and 166(d).
1. Regulations as a Whole Should Fulfill Statutory Requirements
    Section 166(a) directs EPA to develop pollutant-specific 
regulations to prevent the significant deterioration of air quality. 
Sections 166(c) and 166(d) provide detail on the contents of those 
regulations, but do not necessarily require the same type of increment 
system Congress created in section 163 of the Act. Thus, in order to 
develop pollutant-specific regulations under subsection (a), EPA must 
establish both the overall regulatory framework for those regulations 
(such as system of increments) and fill details around that framework 
(such as the level of the increments). Thus, EPA interprets section 166 
to require that the entire system of PSD regulations (the framework and 
details) for a particular pollutant must, as a whole, satisfy the 
criteria in sections 166(c) and 166(d). We propose to use the same 
approach to establish pollutant-specific regulations for PM2.5 
under option 1 of this proposal.
    When we propose a framework involving numerical increments under 
section 166(a) of the Act, we do not look at increments in isolation, 
but we also consider how these increments work in conjunction with 
other measures to satisfy the statutory criteria. The other measures 
that EPA may consider include new measures proposed by EPA for that 
pollutant or measures applicable to other pollutants that EPA proposes 
to apply to additional pollutants. Examples of other measures are an 
area classification system, AQRV review in Class I areas, additional 
impacts analysis, and control technology requirements. This approach is 
consistent with section 166(d), which says that pollutant-specific PSD 
regulations ``may contain'' increments or ``other measures.''
2. Contingent Safe Harbor Approach
    The EPA continues to view the ``contingent safe harbor'' approach 
to be an appropriate methodology for ensuring that our pollutant-
specific PSD regulations meet the requirements of sections 166(c) and 
166(d). Subsection (c) of section 166 describes the kinds of measures 
to be contained in the regulations to prevent significant deterioration 
of air quality called for in section 166(a) and specifies that these 
regulations are to ``fulfill the goals and purposes'' set forth in 
sections 160 and 101 of the Act. Then, under subsection (d), to 
``fulfill such goals and purposes,'' EPA must promulgate ``specific 
measures at least as effective as the increments established in section 
7473

[[Page 54122]]

of this title [section 163 of the Act].'' 42 U.S.C. 7476. Thus, 
subsection (d) can be construed to require that EPA identify a minimum 
level of effectiveness, or safe harbor, for the body of pollutant-
specific PSD regulations adopted under section 166. Subsection (c) may 
then be read to require that EPA conduct further review to determine 
whether, based on the criteria in subsection (c), EPA's pollutant-
specific PSD regulations under section 166 should contain measures that 
deviate from the minimum ``safe harbor'' identified under subsection 
(d). EPA construes subsection (d) to require that the measures be ``at 
least as stringent'' as the statutory increments set forth in section 
163.
    When EPA employs an increment and area classification system in 
regulations promulgated under section 166 of the Act, we interpret the 
Act to require that EPA, at minimum, establish increments that are 
consistent with the statutory increments established by Congress in 
section 163 of the Act. Thus, we start by identifying ``safe harbor'' 
increments for each area classification (Class I, II, or III) that are 
established (1) Using an equivalent percentage of the NAAQS as the 
statutory increments; (2) for the same pollutants as the NAAQS; and (3) 
for the same time period as the NAAQS. We then conduct further review 
to determine whether these ``safe harbor'' increments, in conjunction 
with existing elements of the PSD program or additional measures 
proposed under section 166 to augment the increments, sufficiently 
fulfill the criteria in subsection (c) of section 166. In this review, 
we weigh and balance the criteria set forth in subsection (c) (and the 
incorporated goals and purposes of the Act in section 101 and the PSD 
program in section 160) to determine whether additional measures are 
needed to satisfy the criteria in subsection (c).
3. The Statutory Factors Applicable Under Section 166(c)
    The EPA interprets section 166(c) of the Act to establish eight 
factors to be considered in the development of PSD regulations for the 
pollutants covered by this provision. These factors are three of the 
four criteria listed in section 166(c) and the five goals and purposes 
identified in section 160 of the Act. The three stand-alone criteria in 
section 166(c) indicate that PSD regulations for specific pollutants 
should provide (1) Specific numerical measures for evaluating permit 
applications; (2) a framework for stimulating improved control 
technology; and (3) protection of air quality values. 42 U.S.C. 
7476(c). The five goals and purposes in section 160 are incorporated 
into the analysis by virtue of the fourth criterion in section 166(c), 
which directs that EPA's pollutant-specific PSD regulations ``fulfill 
the goals and purposes'' set forth in sections 160 and 101 of the Act. 
We construe the term ``fulfill the goals and purposes,'' as used in 
section 166(c), to mean that EPA should apply the goals and purposes 
listed in section 160 as factors applicable to pollutant-specific PSD 
regulations established under section 166. The Agency's view is that 
PSD measures that satisfy the specific goals and purposes of section 
160 also satisfy the more general purposes and goals identified in 
section 101 of the Act.
4. Balancing the Factors Applicable Under Section 166(c)
    The EPA interprets the Act to establish a balancing test among the 
eight factors. Since, as discussed further later, many of the factors 
can be satisfied by using an increment framework, when determining the 
characteristics of numerical increments themselves within that 
framework, EPA focuses on balancing the goal to promote economic growth 
with the factors that direct us to protect: (1) AQRVs; (2) the public 
health and welfare from reasonably anticipated foreseeable adverse 
effects; and (3) the air quality in parks and special areas. Section 
166 of the Act authorizes EPA to promulgate pollutant-specific PSD 
regulations that satisfy each of the eight factors. While these 
objectives are generally complementary, there are circumstances where 
some of the objectives may be in conflict. In these situations, some 
degree of balance or accommodation is inherent in the requirement to 
establish regulations that satisfy all of these factors.
    As discussed in our PSD regulations for NOX, we believe 
this balancing test derives primarily from the third goal and purpose 
set forth in section 160. Section 160(3) directs us to ``insure that 
economic growth will occur in a manner consistent with the preservation 
of existing clean air resources.'' To some extent, this goal of the PSD 
program in section 160(3) more specifically articulates the broader 
purpose of the Act, described in section 101(b)(1) of the Act, 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.'' 42 U.S.C. 7401(b)(1). Sections 160(3) and 101(b)(1) 
are similar in that both sections reflect the goal to protect air 
quality and maximize opportunities for economic growth. Thus, in 
interpreting the meaning of section 160(3) when used as a factor 
applicable under section 166(c), we also consider the broader purpose 
of the Act set forth in section 101(b)(1).
    The need to balance the applicable factors to achieve these 
objectives is also supported by our interpretation of the second goal 
in section 160(2) of the Act to ``protect public health and welfare.'' 
The precise meaning of this goal in the context of the PSD program is 
somewhat ambiguous because it appears to mirror the legal standards 
applicable to the promulgation of the primary and secondary NAAQS. 
Under section 109(b) of the Act, the primary NAAQS must ``protect the 
public health'' with an adequate margin of safety (section 109(b)(1)) 
and the secondary NAAQS must ``protect the public welfare from any 
known or anticipated adverse effects'' associated with ambient 
concentrations of the pollutant (section 109(b)(2)). The term 
``welfare'' is defined in the Act to include ``effects on soils, water, 
crops, vegetation, man-made materials, animals, wildlife, weather, 
visibility, and climate.'' Section 302(h) of the Act.
    When applied as one of the factors applicable to pollutant-specific 
PSD regulations under section 166(c) of the Act, we construe the goal 
in section 160(3) of the to ``protect public health and welfare'' to 
mean EPA should evaluate whether reasonably anticipated adverse effects 
may occur as a result of increases in ambient pollutant concentrations 
to levels below the NAAQS. If such effects may occur in some areas of 
the country, then EPA would establish PSD regulations that protect 
public health and welfare against those effects where they may occur. 
However, we do not interpret the PSD program to require regulations 
that eliminate all negative effects that may result from increases in 
pollution in attainment areas.
    The PSD program is, as its title indicates, designed to prevent 
``significant deterioration'' from a baseline concentration. See S. 
Rep. 95-127 at 11 (3 LH at 1385) (``This legislation defines 
`significant deterioration' in all clean air areas as a specified 
amount of additional pollution.* * * This definition is intended to 
prevent any major decline in air quality currently existing in clean 
air areas.'' (emphasis added)). Thus, some decline in air quality 
(relative to the baseline air quality concentration) is permissible for 
any particular area of the country that is currently achieving the 
NAAQS, as long as it is not ``significant.''
    When EPA employs an area classification system in its section 166

[[Page 54123]]

regulations, we generally weigh these factors in each type of area 
(Class I, Class II, and Class III). However, the weight given to each 
factor may be more or less, depending on the area involved and the 
amount of deterioration deemed ``significant'' for that type of area. 
For example, economic growth may be the most important factor in a 
Class III area, but our PSD regulations for such areas should offer 
some level of protection for existing clean air resources. In a Class I 
area, our PSD regulations should allow some level of economic growth, 
even though preservation of existing clean air resources may be the 
dominant factor for these areas.
5. Authority for States To Adopt Alternatives to Increments
    While section 166 of the Act authorizes EPA to promulgate 
increments for pollutants listed under section 166(a), we also 
interpret the section to authorize States to employ approaches other 
than increments to prevent significant deterioration of air quality, so 
long as such an approach otherwise meets the requirements of sections 
166(c) and 166(d). As described earlier, we explained this 
interpretation in the 2005 NOX increment rulemaking 
whereupon we amended the PSD regulations at 40 CFR 51.166 by adding new 
paragraph (c)(2) to codify this statutory authority (70 FR 59582, 
October 12, 2005). However, in establishing the new provision, the 
language at paragraph (c)(2) reflected the authority for States to 
adopt alternative measures only with respect to increments for 
NOX. In order to clarify our interpretation that the 
authority to adopt alternative measures covers any pollutant listed in 
section 166(a), we are proposing in this action to revise existing 40 
CFR 51.166(c)(2) to make it inclusive to applicable pollutants rather 
than just NOX.

C. Requirements of Section 166(f) of the Clean Air Act

    If we decide to use the equivalent substitution options in this 
proposal for PM2.5, EPA proposes to interpret section 166(f) 
of the Act in the same manner that the Agency interpreted that 
provision in our 1993 rule for PM10. In 1993, EPA construed 
section 166(f) as authorizing EPA to follow the path that EPA laid out 
in our 1989 proposal for developing equivalent increments for PM 
measured as PM10. 58 FR 31626. Thus, in our 1993 rulemaking, 
EPA developed our PM10 increments using the ``equivalent to 
statutory increments'' option that EPA described in our notice of 
proposed rulemaking. The EPA did not interpret the ``equivalent 
stringency in effect'' standard in section 166(f) to require EPA to use 
the second approach from the proposal, the ``percentage of NAAQS'' 
approach that Congress had originally used to establish TSP increments. 
The Agency observed that if Congress intended to require EPA to update 
the TSP increments using a straight percentage, Congress could have 
easily revised the increments in section 163 instead of providing EPA 
discretion to establish increments following the standard provided in 
section 166(f). 58 FR 31626. The EPA thus construed section 166(f) as 
providing EPA discretion to determine appropriate equivalent levels of 
PM10. Id. The EPA identified equivalent levels by developing 
a ratio based on a comparison of the TSP and PM10 impacts of 
stationary sources. 58 FR 31627.
    In this rulemaking, EPA proposes to apply the same type of ratio 
approach to establish equivalent increments for PM10 under 
section 166(f) of the Act. Since this ratio approach was the foundation 
of EPA's equivalency method in the 1989 proposal, we believe it is 
permissible, as we did in 1993, to construe section 166(f) as 
authorizing EPA to continue utilizing this approach to establish 
equivalent increments for PM.
    In 1993, EPA disagreed with commenters who recommended that EPA 
consider welfare effects and visibility impairments when establishing 
PM10 increments under section 166(f) for class I areas. The 
EPA observed that there was no evidence that Congress itself adopted 
increments that would ensure specific levels of welfare and visibility 
protection at each Class I area throughout the nation. The increments 
established by Congress did not establish an absolute ceiling on air 
quality, but rather limited the marginal amount of deterioration in air 
quality above a baseline concentration that varies for each area, and 
thus permitted each area with the same classification to deteriorate in 
the same amount without regard to its particular sensitivities as 
compared to other areas with the same classification. 58 FR 31625. The 
EPA concluded that the PM10 increments should be designed to 
protect each area from large adverse changes in air quality while the 
air quality related values analysis was the main tool for protecting 
specific ecologically-based attributes in particular class I areas. Id.
    In this rulemaking for PM2.5, we maintain the view that 
the ``equal stringency in effect'' language in section 166(f) does not 
require EPA to consider welfare effects and visibility when 
promulgating replacement increments under that provision. However, as 
reflected in our recent increments rule for NOX, when 
promulgating PSD increments under section 166(a), welfare effects and 
visibility impacts are factors in the contingent safe harbor analysis 
under the criteria in sections 166(c) and 160 of the Act. Consistent 
with our recent PSD regulations for NOX, we continue to 
believe that increments (whether promulgated under section 166(a) or 
166(f)) should be designed to provide each area with a basic level of 
protection from large adverse changes in air quality without 
necessarily reflecting the unique air pollution sensitivities in each 
class I area. The EPA considers welfare and visibility impacts across 
the nation when establishing increments under section 166(a), but we 
continue to believe that the Air Quality Related Values (AQRV) review 
is the preferred tool for identification and protection of specific 
ecologically-based attributes within particular class I areas. See 58 
FR 31625.

V. Increments and Other Measures To Prevent Significant Deterioration

    In this action, EPA is proposing three options for establishing 
increments for PM2.5. The first option described uses the 
``contingent safe harbor'' approach (using percentages of the NAAQS as 
our initial basis) following section 166(a) of the Act. The other two 
options are variations of the section 166(f) ``Equivalent Increment'' 
approach. The EPA is proposing option 1 as our preferred option and 
seeking comments on the other two options.

A. Option 1--Contingent Safe Harbor Approach for Annual and Short-Term 
Increments--Section 166(a)

    Under the first option, we would consider PM2.5 to be a 
new pollutant \8\ for which a NAAQS was promulgated after the date of 
enactment of subpart C, and we would use the authority of section 
166(a) of the Act to develop new increments for PM2.5. Using 
this option, we are proposing to establish a system of increments at 
the safe harbor level in conjunction with the other measures described 
as follows:
---------------------------------------------------------------------------

    \8\ In our review of the PM NAAQS, we concluded that, because 
the fine and thoracic coarse components of PM10 generally 
have different sources, composition and formation processes, they 
should be treated as separate pollutants. (OAQPS SP, December 2005, 
page 3-1.)
---------------------------------------------------------------------------

1. Proposed Framework for Pollutant Specific PSD Regulations for 
PM2.5
    Under this option, EPA proposes to apply the same basic 
framework reflected in our regulation for NOX in

[[Page 54124]]

pollutant-specific PSD regulations for PM2.5. Thus, we 
propose to adopt an increment and area classification system for 
PM2.5 and to apply an AQRV review process to PM2.5 
as well. As discussed further later, EPA believes that many of the 
factors applicable under section 166(c) are fulfilled by using this 
type of framework for pollutant-specific PSD regulations under section 
166(a) of the Act. For other factors, this framework of regulations 
partially contributes to the fulfillment of an applicable factor but 
may not fully satisfy that factor. In these instances, the details of 
our regulations (such as the characteristics of the increments 
themselves) are also important and we evaluate the effectiveness of the 
framework in conjunction with more detailed elements of our 
regulations. The EPA believes our obligations under section 166(c) of 
the Act are satisfied when the PSD regulations collectively satisfy the 
factors applicable under 166(c) of the Act.
a. Increment System
    An increment is the maximum allowable level of ambient pollutant 
concentration increase that is allowed to occur above the applicable 
baseline concentration in a particular area. As such, an increment 
defines ``significant deterioration.'' Establishing an increment system 
for PM2.5 will fulfill two of the factors applicable under 
section 166(c).
    An increment-based program satisfies the requirements under 166(c) 
to provide ``specific numerical measures against which permit 
applications may be evaluated.'' Under section 165(a)(3) of the Act, a 
permit applicant must demonstrate that emissions from the proposed 
construction and operation of a facility ``will not cause, or 
contribute to, air pollution in excess of any (A) maximum allowable 
increase or maximum allowable concentration for any pollutant.'' 42 
U.S.C. 7475(a)(3). Once the baseline date associated with the first 
proposed new major stationary source or major modification in an area 
is established, the new emissions from that source consume a portion of 
the increment in that area, as do any subsequent emissions increases 
that occur from any source in the area. When the maximum pollutant 
concentration increase defined by the increment has been reached, 
additional PSD permits cannot be issued until sufficient amounts of the 
increment are ``freed up'' via emissions reductions that may be 
required by the reviewing authority. Thus, an increment is a 
quantitative value that establishes a ``maximum allowable increase'' 
for a particular pollutant. It functions, therefore, as a specific 
numerical measure that can be used to evaluate whether an applicant's 
proposed project will cause or contribute to air pollution in excess of 
allowable levels.
    Increments also satisfy the second factor in section 166(c) by 
providing ``a framework for stimulating improved control technology.'' 
Increments establish an incentive to apply improved control 
technologies in order to avoid violating the increment and to ``free-
up'' available increment to promote continued economic growth. These 
control technologies may become the basis of BACT determinations 
elsewhere, as the technologies become more commonplace and the costs 
tend to decline. See also S. Rep. 95-127 at 18, 30 (3 LH at 1392, 1404) 
(``the incremental ceiling should serve as an incentive to technology, 
as a potential source may wish to push the frontiers of technology in a 
particular case to obtain greater productive capacity within the limits 
of the increments'').
    However, we recognize that an increment system is not the only way 
to fulfill the requirements of section 166 of the Act. Congress did not 
require EPA to utilize increments in our PSD regulations for 
NOX but gave EPA the discretion to employ increments if 
appropriate to meet the criteria and goals and purposes set forth in 
sections 166 and 160 of the Act. 42 U.S.C. 7474(d); EDF v. EPA, 898 
F.2d at 185 (``Congress contemplated that EPA might use increments''). 
Thus, in this action, we are also proposing to allow States to develop 
alternatives to an increment system at their discretion, and to submit 
any such alternative program to EPA so that we can determine whether it 
satisfies the requirements of section 166.
b. Area Classifications
    The EPA proposes to establish the same three-tiered area 
classification system for PM2.5 that is applicable to 
NOX and other pollutants under the PSD program and the Clean 
Air Act. Accordingly, areas that are currently Class I for other 
pollutants would also be Class I for PM2.5 and all other 
areas would be Class II for PM2.5 unless we redesignated the 
area based on a request by a state or tribe pursuant to the process in 
section 164 of the Act and EPA's regulations at 40 CFR 51.166(g) and 
52.21(g).
    As explained earlier, in section III.E.1, Class I areas are areas 
where especially clean air is most desirable. In contrast, Class III 
areas, which are those areas in which a State wishes to permit the 
highest relative level of industrial development, have the largest 
increment level. Areas that are not especially sensitive or that do not 
wish to allow for a higher level of industrial growth are classified as 
Class II. When Congress established this three-tiered scheme for 
SO2 and PM, it intended that Class II areas be subject to an 
increment that allows ``moderately large increases over existing 
pollution.''

H.R. Rep. 95-294, 4 LH at 2609.

    Establishing increments at different levels for each of the three 
area classifications helps to fulfill two of the factors applicable 
under section 166(c) of the Act. Establishing the smallest increments 
in Class I areas helps fulfill EPA's obligation to establish 
regulations that ``preserve, protect, and enhance the air quality'' in 
parks and special areas. Class I areas are primarily the kinds of parks 
and special areas covered by section 160(2) of the Act. With the air 
quality in Class I areas subject to the greatest protection, this 
scheme then provides two additional area classifications with higher 
increment levels to help satisfy the goal in section 160(3) of the Act 
that EPA ``insure that economic growth will occur in a manner 
consistent with preservation of clean air resources.'' In those areas 
where clean air resources may not require as much protection, more 
growth is allowed. By employing an intermediate level (Class II areas) 
and higher level (Class III areas), this classification scheme helps 
ensure that growth can occur where it is needed (Class III areas) 
without putting as much pressure on existing clean air resources in 
other areas where some growth is still desired (Class II areas).
    By requesting that EPA redesignate an existing Class II area to 
Class III, States may accommodate economic growth and air quality in 
areas where the Class II increment is too small to allow the siting of 
new or modified sources. The procedures specified by the Act for such a 
redesignation require a commitment by the State government to create 
such an area, extensive public review, local government participation 
in the SIP area redesignation process, and a finding that the 
redesignation will not result in the applicable increment being 
exceeded in a nearby Class I or Class II area. See 42 U.S.C. 7474(a)-
(b) (Section 164(a)-(b) of the Act). The EPA believes that the three-
tiered classification system has allowed for economic growth, 
consistent with the preservation of clean air resources.
    However, an area classification system alone may not completely 
satisfy the factors applicable under section 166(c) of the Act. The 
increment that is

[[Page 54125]]

employed for each class of area is also relevant to an evaluation of 
whether the area classification scheme achieves the goals of the PSD 
program. We discuss the characteristics of increments later.
c. Permitting Procedures
    Two of the factors applicable under section 166(c) are fulfilled by 
the case-by-case permit review procedures that are built into our 
existing regulations. The framework of our existing PSD regulations 
employs the preconstruction permitting system and procedures required 
under section 165 of the Act. 42 U.S.C. 7475. These requirements are 
generally reflected in 40 CFR 51.166 and 52.21 of EPA's PSD regulations 
in Title 40 of the Code of Federal Regulations. These permitting and 
review procedures, which we interpret to apply to construction of new 
major sources and to major modifications at existing sources, fulfill 
the goals set forth in sections 160(4) and 160(5) of the Act. These 
goals require that PSD programs in one State not interfere with the PSD 
programs in other States and that PSD programs assure that any decision 
to permit increased air pollution is made after careful evaluation and 
public participation in the decisionmaking process. For the same 
reasons discussed in our proposal for the pollutant-specific PSD 
regulations for NOX regulations, 70 FR 8896, we believe 
these factors are also fulfilled for PM2.5 by employing the 
permit review procedures.
d. Air Quality Related Values Review by Federal Land Manager and 
Reviewing Authority
    The EPA also proposes to apply the requirement to evaluate impacts 
on AQRVs in Class I areas to PM2.5. The AQRV review provides 
the Federal Land Managers (FLM) the opportunity to review source 
impacts on site-specific AQRVs in Class I areas and to bring any 
adverse impacts to the attention of the reviewing authority. Under an 
increment approach, we consider this review to be an additional measure 
that helps to satisfy the factors in sections 166(c) and 160(2) which 
require that EPA's pollutant-specific PSD regulations protect air 
quality values, and parks and other special areas, respectively.
    In our rulemakings addressing PSD for NOX, EPA extended 
the AQRV review procedures set forth in 40 CFR 51.166(p) and 52.21(p) 
to cover NO2. These AQRV review procedures were established 
based on section 165(d) of the Act, and they were originally applied 
only in the context of the statutory increments for PM and 
SO2. However, because they also address many of the factors 
applicable under section 166(c) of the Act, EPA also applied them to 
NOX through regulation. We propose the same approach for PM 
2.5 in this rulemaking.
    Section 165(d) creates a scheme in which the FLM and reviewing 
authority must review the impacts of a proposed new or modified 
source's emissions on AQRVs. The Act assigns to the FLM an 
``affirmative responsibility'' to protect the AQRVs in Class I areas. 
The FLM may object to or concur in the issuance of a PSD permit based 
on the impact, or lack thereof, that new emissions may have on any 
affected AQRV that the FLM has identified and for which information is 
available to the general public. If the proposed source's emissions do 
not cause or contribute to a violation of a Class I increment, the FLM 
may still prevent issuance of the permit by demonstrating to the 
satisfaction of the reviewing authority that the source or modification 
will have an adverse impact on AQRVs. Section 165(d)(2)(C). On the 
other hand, if the proposed source will cause or contribute to a 
violation of a Class I increment, the reviewing authority (State or 
EPA) shall not issue the permit unless the owner or operator 
demonstrates to the satisfaction of the FLM that there will be no 
adverse impact on AQRVs.\9\ Thus, the compliance with the increment 
determines whether the FLM or the permit applicant has the burden of 
satisfactorily demonstrating whether or not the proposed source's 
emissions would have an adverse impact on AQRVs.\10\ In any event, the 
FLM plays an important and material role by raising these issues for 
consideration by the reviewing authority, which in the majority of 
cases will be the State.
---------------------------------------------------------------------------

    \9\ Even if such a waiver of the Class I increment is allowed 
upon a finding of no adverse impact, the source must comply with 
such emissions limitations as may be necessary to ensure that the 
Class II increment for SO2 or PM is not exceeded. Section 
165(d)(2)(C)(iv). The EPA made this provision applicable to the PSD 
provisions for NOX, with a cap of 25 g/m \3\--the NO 
2 Class II increment. 53 FR 3704; 40 CFR 51.166(p)(4) and 
52.21(p)(5).
    \10\ In response to concerns that Class I increment would hinder 
growth in areas surrounding the Class I area, Congress established 
Class I increments as a means of determining where the burden of 
proof should lie for a demonstration of adverse effects on AQRVs. 
See Senate Debate, June 8, 1977 (3 LH at 725).
---------------------------------------------------------------------------

    Incorporating these AQRV review procedures into the PSD regulations 
for PM2.5 helps to provide protection for parks and special 
areas (which are generally the Class I areas subject to this review) 
and air quality values (which are factors considered in the review). As 
discussed later, we believe the factors applicable under section 166(c) 
of the Act can be fulfilled when the review of AQRVs is applied in 
conjunction with increments and other aspects of our PSD regulations. 
In those cases where the increment is not violated and the reviewing 
authority agrees that a proposed project will adversely affect AQRVs, 
the parks and other special areas will be protected by denying issuance 
of the permit or by requiring the applicant to modify the project to 
alleviate the adverse impact. Legislative history suggests that the 
AQRV review provisions of section 165(d) were intended to provide 
another layer of protection, beyond that provided by increments. The 
Senate committee report stated the following: ``A second test of 
protection is provided in specified Federal land areas (Class I areas), 
such as national parks and wilderness areas; these areas are also 
subjected to a review process based on the effect of pollution on the 
area's air quality related values.'' S. Rep. 95-127, at 17, 4 LH at 
1401. As we stated in the NOX rule, we believe the term 
``air quality values'' should be given the same meaning as ``air 
quality related values.'' Legislative history indicates that the term 
``air quality value'' was used interchangeably with the term ``air 
quality related value'' (AQRV) regarding Class I lands.\11\
---------------------------------------------------------------------------

    \11\ See S. Rep. 95-127, at 12, reprinted at 3 LH at 1386, 1410 
(describing the goal of protecting ``air quality values'' in 
``Federal lands--such as national parks and wilderness areas and 
international parks,'' and in the next paragraph and subsequent text 
using the term ``air quality related values'' to describe the same 
goal); id. at 35, 36 (``The bill charges the Federal land manager 
and the supervisor with a positive role to protect air quality 
values associated with the land areas under the jurisdiction of the 
[FLM]'' and then describing the statutory term as ``air quality 
related values''). H.R. Report 95-564 at 532 (describing duty of 
Administrator to consider ``air quality values'' of the tribal and 
State lands in resolving an appeal of a tribal or State 
redesignation, which is described in the final bill as ``air quality 
related values'').
---------------------------------------------------------------------------

e. Additional Impacts Analysis.
    The additional impacts analysis set forth in our regulations also 
helps fulfill the criteria and goals and purposes in sections 166(c) 
and 160. The additional impacts analysis involves a case-by-case review 
of potential harm to visibility, soils, and vegetation that could occur 
from the construction or modification of a source.
    Sections 51.166(o)(1) and 52.21(o)(1) of the PSD regulations 
require that a permit provide the following analysis:

    An analysis of the impairment to visibility, soils and 
vegetation that would occur as a result of the source or 
modification, and general commercial, residential, industrial and 
other growth associated with the source

[[Page 54126]]

or modification. The owner or operator need not provide an analysis 
of the impact on vegetation having no significant commercial or 
recreational value.

This requirement was based on section 165(e)(3)(B) of the Act, which 
provides that EPA establish regulations that require ``an analysis of 
the ambient air quality, climate and meteorology, terrain, soils and 
vegetation, and visibility at the site of the proposed major emitting 
facility and in the area potentially affected by emissions from such 
facility * * * ''

42 U.S.C. 7475(e)(3)(B).

    This portion of the additional impacts analysis is especially 
helpful for satisfying the requirements of section 166(c) in Class II 
and Class III areas. These areas are not subject to the additional AQRV 
review that applies only in Class I areas. While not as intensive a 
review as AQRV analysis required in Class I areas, considering 
impairments to visibility, soils, and vegetation through the additional 
impacts analysis contributes to satisfying the factors applicable under 
section 166(c) of the Act in all areas, including Class II and Class 
III areas.
f. Installation of Best Available Control Technology
    The requirement that new sources and modified sources subject to 
PSD apply BACT is an additional measure that helps to satisfy the 
factors in sections 166(c), 160(1), and 160(2) of the Act. This 
requirement, based on section 165(a)(4) of the Act, is already included 
in EPA's PSD regulations and thus we consider it to be a part of the 
regulatory framework for the Agency's pollutant-specific regulations 
for PM2.5. 40 CFR 52.21(j); 40 CFR 51.166(j). Our existing 
regulations define ``best available control technology'' as ``an 
emission limitation * * * based on the maximum degree of reduction for 
each pollutant subject to regulation under the Act * * * which the 
Administrator, on a case-by-case basis, taking into account energy, 
environmental, and economic impacts and other costs, determines is 
achievable for such source through application of production processes 
or available methods, systems, and techniques * * * '' 40 CFR 
52.21(b)(12); 40 CFR 52.166(b)(12). This pollutant control technology 
requirement in practice has required significant reductions in the 
pollutant emissions increases from new and modified sources while also 
stimulating the on-going improvement of control technology. The control 
of PM2.5 emissions through the application of BACT helps to 
protect air quality values, public health and welfare, and parks and 
other special areas.
2. Proposed Increments
    Based on our evaluation of the effects of PM2.5 and a 
balancing of the criteria in section 166(c) of the Act (and the 
incorporated goals and purposes of the Act in section 101 and the PSD 
program in section 160), EPA proposes to find that the ``safe harbor'' 
increments for PM2.5 (which meet the minimum requirements in 
section 166(d) of the Act) are sufficient to fulfill the criteria in 
section 166(c) when combined with the other measures described earlier 
that we propose to apply to PM2.5. Since several of the 
eight factors applicable under section 166(c) are satisfied by adopting 
the framework and other measures described earlier, our development of 
the proposed increments for PM2.5 was guided by the four 
remaining factors that may not be fully satisfied by the framework and 
other measures: (1) Protecting AQRVs; (2) protecting the public health 
and welfare from reasonably-anticipated adverse effects; (3) protecting 
the air quality in parks and special areas; and (4) ensuring economic 
growth.\12\ In accordance with the contingent safe harbor approach, to 
determine the specific characteristics of the proposed increments, we 
first established the minimum level of effectiveness necessary to 
satisfy section 166(d) and then conducted further analysis to determine 
if additional measures are necessary to fulfill the requirements of 
section 166(c).
---------------------------------------------------------------------------

    \12\ We have paraphrased these factors here and in other 
sections to facilitate the explanation of our reasoning. However, we 
recognize, as we did in our regulation for NOX that the 
statutory language is broader than the shorthand we use here for 
convenience.
---------------------------------------------------------------------------

a. Identification of Safe Harbor Increments
    Using the percentage-of-NAAQS approach, we derived the following 
safe harbor increments for PM2.5:

------------------------------------------------------------------------
                                NAAQS       Increments  ([mu]g/m \3\)
      Averaging period         ([mu]g/m --------------------------------
                                 \3\)     Class I    Class II  Class III
------------------------------------------------------------------------
Annual......................         15          1          4          8
24-hour.....................         35          2          9         18
------------------------------------------------------------------------

    The PM2.5 levels of both the primary and secondary NAAQS 
are 15 [mu]g/m \3\ for the annual averaging time and 35 [mu]g/m \3\ for 
the 24-hour averaging time. See 40 CFR 50.7. We calculated the safe 
harbor increments based on the same percentages that were used by 
Congress to establish the original PM increments (measured as TSP) in 
section 163 of the Act i.e. 6.6 percent of the NAAQS for Class I areas; 
25 percent of the NAAQS for Class II areas and 50 percent of the NAAQS 
for Class III areas. Increments with these characteristics are 
sufficient to satisfy the requirement in section 166(d) requirement 
that we adopt increments (or other PSD regulations) that are ``at least 
as effective as'' the increments established in section 163 of the Act. 
42 U.S.C. 7476(d); See EDF v. EPA, 898 F.2d at 188, 190.
b. Data Utilized by EPA for the Evaluation of the Safe Harbor 
Increments for PM2.5
    We evaluated whether measures other than the safe harbor increments 
are necessary by analyzing primarily the scientific and technical 
information on the health and welfare effects of PM2.5 
contained in the June 2005 OAQPS Staff Paper (SP) used for the periodic 
review of the 2004 PM air quality Criteria Document (CD).\13\
---------------------------------------------------------------------------

    \13\ This periodic review of the PM NAAQS updates the last 
review, which began in 1994 and resulted in revised standards for PM 
in 1997.
---------------------------------------------------------------------------

    Section 166 provides that EPA is to establish pollutant-specific 
PSD regulations, including increments, after the establishment of a 
NAAQS for the applicable pollutants. 42 U.S.C. 7476(a). Under normal 
circumstances, the Act provides that EPA promulgate new PSD regulations 
under section 166, including new increments if appropriate, within 2 
years from the promulgation of any NAAQS after 1977. 42 U.S.C. 7476(a). 
In such instances, the health and welfare information used for the 
setting of the NAAQS would also be ``current'' for

[[Page 54127]]

purposes of establishing pollutant-specific PSD regulations. We believe 
this timing reflects Congressional intent that EPA consider the same 
body of information concerning a pollutant's health and welfare effects 
when it promulgates the NAAQS and subsequent PSD increments (or other 
measures) defining significant air quality deterioration for the same 
pollutant. However, when we use that same information as the basis for 
our pollutant-specific PSD regulations, we must evaluate that 
information under the legal criteria in section 166 of the Act rather 
than the criteria in section 109 applicable to the promulgation of 
NAAQS. See EDF v. EPA, 898 F.2d at 190.
    Since we just completed a review of the PM 2.5 NAAQS, 
the information used in that review is current and timely for purposes 
of this proposal to establish pollutant-specific PSD regulations for 
PM2.5. As discussed earlier, on October 17, 2006, based 
primarily on considerable new data on the air quality and human health 
effects for PM2.5 directly, EPA revised the primary and 
secondary NAAQS to provide increased protection of public health and 
welfare by retaining the level of the annual standard and tightening 
the level of the 24-hour standard from 65 to 35 [mu]g/m \3\ while 
retaining the 24-hour PM10 NAAQS and revoking the annual 
PM10 NAAQS. The information contained in the 2004 CD and 
2005 SP that we also consider for purposes of this proposed rule was 
used for this latest review of the PM NAAQS.
    The 2004 CD and 2005 SP are the products of a rigorous process that 
is followed to validate and interpret the available scientific and 
technical information, and provided the basis for recommending the 
PM2.5 NAAQS. In accordance with the Act, the NAAQS process 
begins with the development of ``air quality criteria'' under section 
108 for air pollutants that ``may reasonably be anticipated to endanger 
public health or welfare'' and that come from ``numerous or diverse'' 
sources. Section 108(a)(1). For each NAAQS review, the Administrator 
must appoint ``an independent scientific review committee composed of 
seven members of the National Academy of Sciences, one physician, and 
one person representing State air pollution control agencies,'' known 
as the Clean Air Scientific Advisory Committee (CASAC). Section 
109(d)(2)(A). The CASAC is charged with recommending revisions to the 
criteria document and NAAQS, and advising the Administrator on several 
issues, including areas in which additional knowledge is required to 
appraise the adequacy and basis of existing, new, or revised NAAQS. 
Section 109(d)(2)(B),(C).
    ``Air quality criteria '' must reflect the latest scientific 
knowledge on ``all identifiable effects on public health or welfare '' 
that may result from a pollutant's presence in the ambient air. 42 
U.S.C. 7408(a)(2). The scientific assessments constituting air quality 
criteria generally take the form of a ``criteria document,'' a rigorous 
review of all pertinent scientific studies and related information. The 
EPA also develops a ``staff paper '' to ``bridge the gap'' between the 
scientific review and the judgments the Administrator must make to set 
standards. See Natural Resources Defense Council v. EPA (``NRDC''), 902 
F.2d 962, 967 ``D.C. Cir. 1990). Both documents undergo extensive 
scientific peer-review as well as public notice and comment. See, e.g., 
62 FR 38654/1-2.
c. Scope of Effects Considered
    The effects of ambient PM2.5 concentrations may include 
secondarily-formed PM2.5. Hence, in this analysis we have 
evaluated the health and welfare effects of both direct 
PM2.5 and secondarily-formed PM2.5 that may 
result from the transformation of other pollutants such as SO2 
and NOX. This is consistent with the approach we described 
for addressing these effects in the recently completed review of our 
pollutant-specific PSD regulations for NOX. 70 FR 59590.
d. Evaluation of the Health and Welfare Effects of PM2.5
    Airborne PM is not a specific chemical entity, but rather is a 
mixture of liquid and solid particles from different sources and of 
different sizes, compositions and properties. Particle size 
distributions show that atmospheric particles exist in two classes: 
fine particles and coarse particles. PM2.5 is an indicator 
for fine particles and represents particles that are mostly less than 
2.5 micrometers in size. PM10-2.5 is an indicator for 
thoracic coarse particles and represents particles sized between 2.5 
and 10 micrometers. In the last two reviews of the PM NAAQS, EPA 
concluded that these two indicators, because of their different 
sources, composition, and formation processes should be treated as 
separate subclasses of PM pollution for purposes of setting ambient air 
quality standards.
    Coarse particles are generally primary particles, emitted directly 
from their source as particles. These particles result from mechanical 
disruption of large particles by crushing or grinding, from evaporation 
of sprays, or from dust resuspension. In addition, some combustion-
generated particles may be found as coarse particles. By comparison, 
fine PM is derived directly from combustion material that has 
volatilized and then condensed to form primary PM or from precursor 
gases, such as SO2 and NOX, reacting in the 
atmosphere to form secondary PM. Because of the complexity of the 
composition of ambient PM2.5 and PM10-2.5, 
sources are best discussed in terms of individual constituents of both 
primary and secondary PM2.5 and PM10-2.5. Each of 
these constituents can have anthropogenic and natural sources. Major 
components of fine particles are sulfates, strong acid, ammonium 
nitrate, organic compounds, trace elements (including metals), 
elemental carbon, and water. Primary and secondary fine particles have 
long lifetimes in the atmosphere (days to weeks) and travel long 
distances (hundreds to thousands of kilometers). They tend to be 
uniformly distributed over urban areas and larger regions, especially 
in the eastern United States. As a result, they are not easily traced 
back to their individual sources. By contrast, coarse particles are not 
readily transported across urban or broader areas. These particles can 
settle rapidly from the atmosphere with lifetimes ranging from minutes 
to days depending on their specific size, atmospheric conditions, and 
altitude.
(1) Health Effects
    The EPA reported important progress since the last PM NAAQS review 
in advancing our understanding of potential mechanisms by which ambient 
PM2.5, alone and in combination with other pollutants, is 
causally linked to a number of key health effects. The more extensive 
and stronger body of evidence used by EPA to study the health effects 
of PM2.5 in our latest review identified a broader range of 
effects than those previously documented, involving premature mortality 
and indices of morbidity (including respiratory hospital admissions and 
emergency room visits, school absences, work loss days, restricted 
activity days, effects on lung function and symptoms, morphological 
changes, and altered host defense mechanisms) associated with both 
long- and short-term exposure to PM2.5.
    An overview of the scientific and technical evidence considered in 
the 2004 CD and 2005 SP can be found in our proposed rule for revising 
the NAAQS for PM published at 70 FR 2619, January 17, 2006, beginning 
at page 2626. The discussion which follows is only a brief summary of 
those

[[Page 54128]]

effects, with an explanation of the range of PM2.5 
concentrations that we examined in considering revisions to the primary 
PM2.5 NAAQS.
    While most epidemiological studies continue to be indexed by 
PM2.5, some studies also implicate various components within 
the mix of fine particles that have been more commonly studied (e.g., 
sulfates, nitrates, carbon, organic compounds, and metals) as being 
associated with adverse effects. Furthermore, the available information 
suggests that many different chemical components of fine particles and 
a variety of different types of source categories are all associated 
with, and probably contribute to, effects associated with 
PM2.5. While there remains uncertainty about the role and 
relative toxicity of various components of fine PM, the current 
evidence continues to support the view that fine particles should be 
addressed as a group for purposes of public health protection.
    Short-term exposure (from less than 1 day up to several days) to 
PM2.5 is likely causally associated with mortality from 
cardiopulmonary diseases, increased hospitalization and emergency 
department visits for cardiopulmonary diseases, increased respiratory 
symptoms, decreased lung function, and changes in physiological 
indicators for cardiovascular health. Effects associated with short-
term exposure identified since the last NAAQS review include increased 
non-hospital medical visits (physician visits) and aggravation of 
asthma associated with short-term exposure to PM2.5. 
Although a growing body of studies provided evidence of effects 
associated with exposure periods shorter than 24-hours (e.g., one to 
several hours), EPA concluded in our 2004 SP that this information was 
too limited to serve as a basis for establishing a primary fine 
particle standard with less than a 24-hour averaging time. However, it 
was concluded that this information added weight to the importance of a 
24-hour standard. In addition, some studies suggested consideration of 
a multiple-day averaging time, but EPA concluded that a multiple-day 
averaging time would add complexity without providing more effective 
protection than a 24-hour averaging time.
    For setting the level of the short-term PM standard, EPA focused on 
a range of 24-hour 98th percentile PM2.5 concentrations of 
about 30 to 35 [mu]g/m\3\. Some new short-term mortality studies 
considered for the last NAAQS review provided evidence of statistically 
significant associations with PM2.5 in areas with air 
quality levels below the level of the then-current primary 24-hour 
PM2.5 NAAQS (65 [mu]g/m\3\). The EPA observed a strong 
predominance of studies with 24-hour 98th percentile values down to 
about 39 [mu]g/m\3\ showing statistically significant association with 
mortality, hospital admissions, and respiratory symptoms. Within the 
range of 24-hour average 98th percentile PM2.5 
concentrations of about 30 to 35 [mu]g/m\3\, EPA no longer observed 
this strong predominance of statistically significant results. Below 35 
[mu]g/m\3\, EPA found increasing variation in the short-term exposure 
studies, which indicated an increase in the uncertainty as to whether 
likely causal associations could be extended. In considering what level 
would be appropriate for the primary 24-hour PM2.5 standard, 
the Administrator indicated that in the absence of evidence of any 
clear effects thresholds, EPA had discretion to select a specific 
standard level from within this range of values. In ultimately deciding 
to set the level of the primary 24-hour PM2.5 standard at 35 
[mu]g/m\3\, the Administrator concluded that a standard set at a higher 
level would not likely result in improvement in air quality in areas 
across the country in which short-term exposure to PM2.5 can 
reasonably be expected to be associated with serious health effects. 
Similarly, a standard set at a lower level was rejected because of 
uncertainties in interpreting the available epidemiologic studies that 
could causally relate the reported associations of health risks to 
PM2.5 at those lower levels.
    New epidemiologic studies have built upon earlier limited evidence 
to provide fairly strong evidence that long-term exposure to 
PM2.5 is likely causally associated with mortality from 
cardiopulmonary disease, as well as development of chronic respiratory 
disease and reduced lung function growth. The new studies also provide 
evidence suggesting that long-term exposure to fine particles is 
associated with lung cancer mortality. The 2004 CD placed the greatest 
weight on re-analyses and extensions of two mortality studies (Six 
Cities and American Cancer Society (ACS) studies) originally considered 
in the previous NAAQS review. In the Six Cities study, the long-term 
mean PM2.5 concentration was 18 [mu]g/m\3\, within an 
overall range of 11 to 30 [mu]g/m\3\. In the extended ACS study, the 
mean for the more recent time period used in the analysis was 14 [mu]g/
m\3\, while the confidence intervals around the relative risk functions 
start to become appreciably wider (more uncertain) below approximately 
12 to 13 [mu]g/m\3\. Based on this and other sets of evidence, EPA 
decided to consider, for setting the level of the annual 
PM2.5 standard, a range of annual PM2.5 
concentrations beginning somewhat below 15 [mu]g/m\3\ (the then-
existing primary annual PM2.5 NAAQS) down to about 12 [mu]g/
m\3\. However, after carefully considering public comments and relevant 
studies, including the uncertainties in interpreting the available 
long-term exposure epidemiologic studies, the Administrator decided to 
retain the level of the primary annual PM2.5 standard at 15 
[mu]g/m\3\ to protect public health with an adequate margin of safety 
from serious health effects. See 71 FR at 61177.
    Despite the advances in knowledge about the effects of 
PM2.5 on human health, the 2005 SP noted the continued 
difficulty of being able to establish a dose-response relationship 
between PM2.5 concentrations and specific health-related 
effects. ``The available toxicologic studies have generally not been 
designed to quantify dose-response relationships* * *. Among the 
studies reviewed [in the 2004 CD] are some that report no evidence of a 
dose-response relationship gradient, (CD, p. 7-152), while some do (CD, 
p. 7-155), and the CD draws no overall conclusions regarding dose-
response relationships from toxicologic studies. Therefore, while 
epidemiologic studies provide clear indication of increasing response 
with increasing concentration, no conclusions can be drawn from 
toxicologic evidence.'' 2005 SP at 3-30.
(2) Welfare Effects
    Ambient PM alone, and in combination with other pollutants, can 
have a variety of effects on public welfare. While visibility 
impairment is the most noticeable effect of fine particles present in 
the atmosphere, both fine and coarse particles can have other 
significant welfare-related effects, including effects on vegetation 
and ecosystems, materials (e.g., soiling and corrosion), and climate 
change processes. In 1997, EPA established a suite of secondary PM 
standards, including annual and 24-hour PM2.5 standards and 
annual and 24-hour PM10 standards, to address visibility 
impairment associated with fine particles, and materials damage and 
soiling related to both fine and coarse particles. See 62 FR 38683. In 
2006, EPA considered the then-currently available evidence and decided 
to revise the current suite of PM2.5 secondary standards by 
making them identical in all respects to the revised suite of primary 
PM2.5 standards, retain the current 24-hour PM10 
secondary

[[Page 54129]]

standard, and revoke the current annual PM10 secondary 
standard.
    In reaching our decision in 2006 to revise the suite of PM 
secondary standards, EPA factored in several key conclusions from the 
scientific and technical information contained in the 2004 CD and 2005 
SP. These conclusions included the following: (1) PM-related visibility 
impairment is principally related to fine particle levels, and most 
directly related to instantaneous levels of visual air quality 
associated with short-term averaging periods; (2) PM2.5 
concentrations can be used as a general surrogate for visibility 
impairment in urban areas; (3) any secondary NAAQS for visibility 
protection should be considered in conjunction with the regional haze 
program as a means of achieving appropriate levels of protection 
against PM-related visibility impairment in urban, non-urban, and Class 
I areas nationwide; (4) the available evidence is not sufficient to 
support distinct secondary standards for fine or coarse particles for 
any non-visibility related welfare effects; and (5) the secondary 
standards should be considered in conjunction with protection afforded 
by other programs intended to address various aspects of air pollution 
effects on ecosystems and vegetation, such as the acid deposition 
program and other regional approaches to reducing pollutants linked to 
nitrate or acidic deposition.
    Notwithstanding the conclusions reached in setting the NAAQS for 
PM, EPA has reviewed the scientific and technical information 
concerning welfare related effects considered in the 2004 CD and 2005 
SP to determine whether there is any basis for modifying the safe 
harbor increments developed for PM2.5 to satisfy the 
criteria under sections 166(c) and 160 of the Act. The EPA's review 
began with visibility impairment, followed by effects on vegetation and 
other ecosystem components, materials and soiling, and climate changes.
    (a) Visibility impairment.
    The EPA has long recognized that impairment of visibility is an 
important effect of PM on public welfare. Visibility can be defined as 
the degree to which the atmosphere is transparent to visible light. 
Visibility conditions are determined by the scattering and absorption 
of light by particles and gases from both natural and anthropogenic 
sources. The classes of fine particles principally responsible for 
visibility impairment are sulfates, nitrates, organic matter, elemental 
carbon, and soil dust.
    Visibility impairment can occur in two principal ways: as local 
visibility impairment (e.g., localized plumes) and as regional haze. 
Local-scale impairment is generally the result of the plume from a 
single source or small group of local sources, rather than from long-
range transport from more distant sources. With this type of 
impairment, a band or layer of discoloration can be observed well above 
the terrain, obscuring the sky or horizon relatively near the source, 
or sources, which cause it. Such visibility problems in urban areas are 
often dominated by local sources, which may include stationary, mobile 
and area sources. Visibility impairment from the combined effects of 
urban sources have been studied in several major cities because of 
concerns about fine particles and their significant impacts on 
residents of large metropolitan areas.
    The second type of impairment, regional haze, generally results 
from pollutant emissions from a multitude of sources located across a 
broad geographic region. Regional haze can impair visibility in every 
direction over a relatively large area, in some cases over multi-state 
regions. Regional haze is principally responsible for impairment in 
national parks and wilderness areas (Class I areas) across the country 
where scenic views are considered an important attribute. Fine 
particles transported from urban and industrialized areas may, in some 
cases, be significant contributors to regional-scale impairment in 
Class I and other rural areas.
    Annual average visibility conditions vary regionally across the 
United States. Higher visibility impairment tends to occur more in the 
East, and is due to generally higher concentrations of anthropogenic 
fine particles and higher relative humidity conditions. In addition, 
the rural East generally has higher levels of impairment than remote 
sites in the West. For Class I areas, visibility levels on the 20 
percent haziest days in the West are about equal to levels on the 20 
percent best days in the East. For urban areas, however, East/West 
visibility differences from fine particles are substantially smaller 
than they are in rural areas.
    The EPA's latest PM NAAQS review focused on visibility impairment 
primarily in urban areas for the following reasons: (1) The efforts now 
underway to address all human-caused visibility impairment in Class I 
areas through regional strategies under the regional haze program (65 
FR 35713, July 1, 1999), and (2) new information from visibility and 
fine particle monitoring networks since the last PM NAAQS review that 
has allowed for updated characterizations of visibility trends and 
current levels in urban areas. Given the strong link between visibility 
impairment and short-term PM2.5 concentrations, EPA gave 
significant consideration to the question of whether visibility 
impairment in urban areas allowed by the original 24-hour secondary 
NAAQS for PM2.5 could be considered adverse to public 
welfare.
    New data available on PM2.5, primarily in urban areas, 
enabled EPA to better characterize urban visibility than was previously 
possible. Such data includes Federal Reference Method (FRM) 
measurements of PM2.5 mass, continuous measurements of 
hourly PM2.5 mass, and PM2.5 chemical speciation 
measurements. Using the new data EPA sought to explore the factors that 
historically complicated efforts to address visibility impairment 
nationally, including regional differences related to levels of 
primarily fine particles and relative humidity. Using the most recent 
monitoring information and analyses, as well as photographic 
representations of visibility impairment in several urban areas to help 
inform judgments about the acceptability of varying levels of visual 
air quality in urban areas, EPA observed that:
    (1) At concentrations at or near the level of the 24-hour 
PM2.5 standard (65 [mu]g/m\3\), which equates to visual 
ranges roughly around 10 kilometers (6 miles), scenic views around and 
within the urban areas, are significantly obscured from view.
    (2) Appreciable improvement in the visual clarity of the scenic 
views occurs at PM2.5 concentrations below 35 to 40 [mu]g/
m\3\, which equates to visual ranges generally above 20 kilometers for 
the urban areas considered.
    (3) Visual air quality appears to be good at PM2.5 
concentrations generally below 20 [mu]g/m\3\, corresponding to visual 
ranges of approximately 25 to 35 kilometers.
    While being mindful of the limitations in using visual 
representations from a small number of areas as a basis for considering 
national visibility-based secondary standards, EPA concluded that the 
observations noted earlier supported consideration of revising the then 
current PM2.5 secondary standards to enhance visual air 
quality, particularly with a focus on urban areas. This led to the 
evaluation of information related to indicator, averaging time, level, 
and form to identify a range of alternative PM standards that would 
protect visual air quality, primarily in urban areas. Notwithstanding 
the selection process used in selecting the primary and

[[Page 54130]]

secondary NAAQS for PM, for this PM increment proposal we are examining 
the same information to determine whether it might justify modifying 
the safe harbor increments for PM2.5, which follow the 
indicator, averaging times, and form of the NAAQS for PM2.5, 
as described earlier as option 1.
    PM indicator. While both fine and coarse particles contribute to 
visibility impairment, visibility impairment is the most noticeable 
effect of fine particles present in the atmosphere. Analyses of hourly 
PM2.5 measurements and other information demonstrate that 
fine particles contribute to visibility impairment directly in 
proportion to their concentration in the ambient air. Moreover, 
hygroscopic components of fine particles, in particular sulfates and 
nitrates, contribute disproportionately to visibility impairment under 
high humidity conditions, when such components reach particle diameters 
up to and even above 2.5 [mu]m. The EPA's analyses of how well 
PM2.5 concentrations correlated with visibility in urban 
locations across the United States lead to the conclusion that the 
observed correlations were strong enough to support the use of 
PM2.5 as the indicator for standards to address visibility 
impairment in urban areas, especially when the indicator is defined for 
a relatively short period of daylight hours.
    Averaging time. While EPA selected the 24-hour averaging time for 
the PM2.5 secondary standard to address visibility 
impairment primarily in urban areas, a range of shorter term (sub-
daily) daylight averaging times were also considered. Strong 
correlations between visibility and PM2.5 concentrations 
were found to occur at the 24-hour averaging time, but the strongest 
correlations were found to occur at the sub-daily daylight averaging 
times, e.g., 4-to 8-hour daylight averaging times. In fact, the 
correlation was greatest in the 4-hour time period between 12 and 4 
p.m. At the sub-daily daylight averaging times, correlations between 
PM2.5 concentrations and light extinction were less 
influenced by relative humidity and more consistent across regions.
    A number of different daylight time periods was selected to compare 
correlations between visibility and hourly PM2.5 
concentrations in urban areas across the United States and in eastern 
and western regions. Ultimately, EPA staff recommended consideration of 
a short-term averaging time, within the range of 4 to 8 hours, within a 
daylight time period between approximately 10 a.m. to 6 p.m., to target 
the driest part of the day. Most CASAC Panel members supported the SP 
recommendation of a sub-daily averaging time.
    Following careful consideration of the various sets of data and 
evidence concerning visibility impairment, the Administrator proposed 
to revise the secondary 24-hour standard for PM2.5 to make 
it identical to the proposed revised primary PM2.5 standard 
(based on a 24-hour averaging time for the short-term standard). 
Consistent with recommendations to consider a sub-daily averaging time, 
the Administrator also solicited comment on 4-to 8-hour averaging time 
for the secondary PM2.5 standard. In reaching his final 
decision to rely on the 24-hour averaging period to set the secondary 
standard for PM2.5, the Administrator concluded that the 
relative protection against adverse effects on public welfare provided 
by the proposed primary standards was equivalent or more protective 
than several of the 4-hour secondary standard alternatives in the range 
recommended by CASAC and the SP. He also believed that caution was 
warranted in establishing a distinct secondary standard for visibility 
impairment primarily in urban areas, given the limitations in the 
underlying studies and the subjective nature of the judgment required.
    Level of increment. In evaluating the adequacy of the levels of the 
contingent safe harbor increments for PM2.5, we examined the 
range of PM2.5 concentrations considered in setting a 
national visibility standard primarily for urban areas. We had 
established that range of concentrations by using the results of public 
perception and attitude surveys conducted in the United States and 
Canada, State and local visibility standards within the United States, 
and visual inspection of photographic representations of several urban 
areas across the United States. These approaches are detailed in the 
2005 SP (pp. 6-18 to 6-23.)
    The public perception and attitude studies were used to gain an 
understanding of what the public regarded as an acceptable visible 
range. In some urban areas, poor visibility has led to more localized 
efforts to better characterize, as well as improve, urban visibility 
conditions. Public perception surveys used in Denver, Phoenix, and 
British Columbia studies yielded reasonably consistent results, with 
each study indicating that a majority of citizens find value in 
protecting local visibility to with a visual range of about 40 to 60 
km. Visibility standards for the Lake Tahoe area in California and for 
areas within the State of Vermont are both targeted at a visual range 
of about 50 km. In contrast, California's longstanding general state-
wide visibility standard is a visual range of approximately 16 km.
    Aided by photographic representations of varying levels of visual 
air quality developed for several cities across the United States, EPA 
staff reached the conclusion that a national visibility standard in the 
PM2.5 concentration range of 30 to 20 [mu]g/m\3\ should be 
considered. Further analyses to characterize the distributions of 
PM2.5 concentrations, 4-hour averages in the 12 to 4 p.m. 
time frame, by region, that correspond to various visual range target 
levels, resulted in a finding that concentrations of 30, 25, and 20 
[mu]g/m\3\ correspond to the target visual ranges of approximately 25, 
30 and 35 km, respectively. Thus, it was determined that a standard set 
within the range of 30 to 20 [mu]g/m\3\ could be expected to correspond 
generally to media visual range levels of approximately 25 to 35 km in 
urban areas across the United States. This range was generally 
consistent with a national target visual range below 40 km, the level 
suggested by the public perception surveys and the local visibility 
standards and goals. Nevertheless, EPA staff noted that a standard set 
at any specific PM2.5concentration will necessarily result 
in visual ranges that vary somewhat in urban areas across the country, 
reflecting in part the less-than-perfect correlation between 
PM2.5 concentrations and reconstructed light extinction. 
2005 SP at page 7-8.
    Form of increment. In considering a reasonable range of forms for a 
PM2.5 standard within the range of PM2.5 
concentration levels being considered, EPA staff took into account the 
same general factors that were taken into account in considering an 
appropriate form for the primary PM2.5 standard. In that 
case, EPA staff concluded that a concentration-based form should be 
considered because of its advantages over the previously used expected-
exceedance form.\14\ For visibility, the advantages are that the 
concentration-based form (1) Would give proportionally greater weight 
to days when the PM-related visibility impairment is substantially 
higher than to days just above the standard, and (2) has greater 
stability. 2005 SP at 7-11. To identify a range of concentration 
percentiles that would be appropriate for consideration, it was 
concluded that

[[Page 54131]]

the upper end of the range of consideration should be the 98th to 99th 
percentile, consistent with the forms being considered for the 24-hour 
primary PM2.5 standard. For the lower end of the range, EPA 
staff used the 92nd percentile because it represented the mean of the 
distribution of the 20 percent worst days, consistent with the fact 
that the regional haze program targets the 20 percent most impaired 
days for improvements in visual air quality in Class I areas. 2005 SP 
at 7-12.
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    \14\ The form of the 1987 24-hour PM10 standard is 
based on the expected number of day per year (averaged over 3 years) 
on which the level of the standard is exceeded; thus, attainment 
with the one-expected exceedance form is determined by comparing the 
fourth-highest concentration in 3 years with the level of the 
standard.
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    While EPA staff regarded PM2.5 as the best indicator for 
addressing visibility impairment in urban areas, they considered a 
range of averaging times, levels, and forms for setting a 
PM2.5 secondary standard. In summary, EPA staff recommended 
that consideration be given to a short-term averaging time for a 
PM2.5 standard, within the range of 4 to 8 hours, within a 
daylight time period between approximately 10 a.m. to 6 p.m. In 
addition, they recommended that consideration should be given to the 
adoption of Federal equivalent methods for appropriate continuous 
methods for measurement of short-term average PM2.5 
concentrations to facilitate implementation of the standard. Within the 
recommended 4- to 8-hour averaging time, the EPA staff recommended 
consideration of a standard level within the range of 30 to 20 [mu]g/
m\3\, depending in part on the form of the standard selected. Finally, 
staff recommended consideration of a percentile-based form, focusing on 
a range from the 92nd percentile up to the 98th percentile of the 
annual distribution of daily short-term PM2.5 concentrations 
averaged over 3 years. 2005 SP at 7-13.
    (b) Vegetation and other ecosystem components.
    The 2004 CD found that then-current PM2.5 levels in the 
United States ``[had] the potential to alter ecosystem structure and 
function in ways that may reduce their ability to meet societal needs'' 
(CD, p. 4-153). However, studies show that vegetation and other 
ecosystem components result predominantly from exposure to excess 
amounts of specific chemical species than from particle source, 
predominant form (particle, gas, or liquid) or size fraction. The 2004 
CD discussed the effects of a number of different chemical species, 
including dust, trace metals, and organics, found within ambient PM, 
but ultimately focused on particulate nitrates and sulfates based on 
the conclusion that these latter constituents of PM2.5 were 
``of greatest and most widespread environmental significance.'' Thus, 
the 2005 SP focused on the welfare effects of particulate nitrates and 
sulfates, either individually, in combination, and/or as contributors 
to total reactive nitrogen deposition and total deposition of 
acidifying compounds on sensitive ecosystem components and essential 
ecological attributes.
    Nitrogen and sulfur in varying amounts are necessary and beneficial 
nutrients for most organisms that make up ecosystems. It is when 
unintentional additions of atmospherically derived nutrient and 
acidifying compounds containing nitrogen and sulfur force unintended 
change on ecosystems, resulting in adverse impacts on essential 
ecological attributes, that deposited particulate nitrate and sulfate 
are termed ecosystem ``stressors.'' In order for any specific chemical 
stressor present in ambient PM to impact ecosystems, it must first be 
removed from the atmosphere through any of three different types of 
deposition: wet (rain/frozen precipitation), dry, or occult (fog, mist, 
or cloud). At the national scale, all types of deposition must be 
considered in determining potential impacts to vegetation and 
ecosystems because each type may dominate over specific intervals of 
time or space.
    The most significant PM-related ecosystem-level effects result from 
long-term cumulative deposition of a given chemical species (e.g., 
nitrate) or mix (e.g., acidic or acidifying deposition) that exceeds 
the natural buffering or storage capacity of the ecosystem and/or 
affects the nutrient status of the ecosystem. The 2005 SP examined the 
environmental effects of both reactive nitrogen (of concern is the 
reactive nitrogen resulting from the conversion of both atmospheric 
nitrogen and fossil nitrogen during the combustion of fossil fuels) and 
PM-related acidic and acidifying deposition on various ecosystems, 
including vegetation, terrestrial ecosystems, threatened and endangered 
species, and aquatic habitat.
    Vegetation. Various studies indicate that at current ambient 
levels, risks to vegetation from short-term exposures to dry deposited 
particulate nitrate or sulfate are low; however, when found in 
acidifying deposition, such particles do have the potential to cause 
direct foliar injury. The 2005 SP concluded on the basis of available 
information that the risk of injury occurring from acid precipitation 
in the eastern United States is high, noting that acid precipitation 
with levels of acidity associated with adverse foliar effects exist in 
some locations of the United States. Such adverse effects may include 
damage to leaf surface structure; increased permeability of leaf 
surface to toxic material, water, and disease agents; increased 
leaching of nutrients from foliage; altered reproductive processes; and 
overall weakening of trees making them more susceptible to other 
stressors. Having said all this, the 2005 SP also found that the 
contribution of particulate sulfates and nitrates to the total acidity 
found in the acid precipitation impacting eastern vegetation is not 
clear.
    Terrestrial ecosystems. The 2005 SP concluded that excess nitrogen 
deposition is having a ``profound and adverse impact on the essential 
ecological attributes associated with terrestrial ecosystems.'' 
Terrestrial ecosystems may be adversely impacted by (1) increased 
nitrogen associated with atmospheric deposition, surface runoff, or 
leaching from nitrogen saturated soils into ground or surface waters; 
and (2) acidic and acidifying deposition.
    Long-term, chronic additions of reactive nitrogen (including 
nitrate deposition and ammonium from ambient PM) can cause the nitrogen 
input to plants to exceed the natural capacity of plants and soil 
microorganisms to utilize and retain the nitrogen needed for normal 
growth. As this excess occurs over time, a detrimental ecological 
condition known as ``nitrogen saturation'' is said to exist.
    Nitrogen saturation does not occur at a specific point in time, but 
reflects a set of gradually developing critical changes in the 
ecosystem process. In addition, not all vegetation, organisms, or 
ecosystems react in the same manner to increased nitrogen availability 
from nitrogen deposition. Those plants that are predisposed to 
capitalize on any increases in nitrogen availability gain an advantage 
over those that are not as responsive to added nitrogen. Over time, 
this shift in the competitive advantage may lead to shifts in overall 
plant community composition. Whether this shift is considered adverse 
would depend on the management context within which that ecosystem 
falls and the ripple effects of this shift on other ecosystem 
components, essential ecosystem attributes, and ecosystems.
    The addition of nitrogen on plant community succession patterns and 
biodiversity has been studied in several long-term nitrogen 
fertilization studies in both the United States and Europe. These 
studies suggest that some forests receiving chronic inputs of nitrogen 
may decline in productivity and experience greater mortality. Some of 
the U.S. forests that are showing severe symptoms of nitrogen 
saturation are: the northern hardwoods and mixed conifer

[[Page 54132]]

forests in the Adirondack and Catskill Mountains of New York; the red 
spruce forests at Whitetop Mountain, Virginia, and Great Smoky 
Mountains National Park, North Carolina; mixed hardwood watersheds at 
Fernow Experimental Forest in West Virginia; American beech forests in 
Great Smoky Mountains National Park, Tennessee; and mixed conifer 
forests and chaparral watersheds in southern California and the 
southwestern Sierra Nevada in Central California. 2005 SP at 6-31.
    Studies have shown that acid deposition has changed the chemical 
composition of soils by depleting the content of available plant 
nutrient cations (e.g., Ca\2+\, Mg\2+\, and K\+\) by increasing the 
mobility of aluminum, and by increasing the sulfur and nitrogen 
content. Effects of acidic deposition have been extensively documented, 
as discussed in the 2004 CD and reports referenced therein. For 
example, effects on some species of forest trees linked to acidic 
deposition include increased permeability of leaf surfaces to toxic 
materials, water, and disease agents; increased leaching of nutrients 
from foliage; and altered reproductive processes; all of which serve to 
weaken trees so that they are more susceptible to other stresses (e.g., 
extreme weather, pests, and pathogens). In particular, acidic 
deposition has been implicated as a causal factor in the northeastern 
high-elevation decline of red spruce. Although U.S. forest ecosystems 
other than the high-elevation spruce-fir forests are not currently 
manifesting symptoms of injury directly attributable to acid 
deposition, less sensitive forests throughout the United States are 
experiencing gradual losses of base cation nutrients, which in many 
cases will reduce the quality of forest nutrition over the long term.
    Threatened and endangered species. The adverse ecological effects 
of PM include those effects on rare and unique ecosystems, including 
both plant and wildlife species. Nitrogen deposition, including 
particulate nitrate, may have a direct adverse affect on some plant 
species, while for others the harm results when added nitrogen serves 
as a nutrient for some invasive species that eventually replace the 
more sensitive, rare species.
    In some instances, as sensitive vegetation is harmed or lost, 
wildlife species that depend on these plants are also adversely 
affected. Several threatened or endangered species listed by the U.S. 
Fish and Wildlife Service, such as the desert tortoise and checkerspot 
butterfly have declined as a result of native food supplies being 
replaced by invasive plant species whose productivity is enhanced in 
part by nitrogen deposition.
    Aquatic habitat. Adverse effects of PM on aquatic systems (streams, 
rivers, lakes, estuaries, and oceans) can be the result of either 
elevated levels of reactive nitrogen input or acidification. In either 
case, the nitrogen input contribution from PM may be the result of 
atmospheric deposition directly into the water body or on terrestrial 
ecosystems, reaching the water body via surface runoff or leaching from 
nitrogen saturated soils into ground or surface waters. However, it is 
not clear how much of the total nitrogen input to aquatic systems 
results from atmospheric deposition rather than from other nitrogen 
sources.
    Estuaries receive far greater nutrient inputs than other systems. 
Excess nitrogen in estuaries results in eutrophic conditions whereupon 
dissolved oxygen is significantly reduced; yielding an environment that 
favors plant life over animal life. The 2005 SP describes research 
being done in the Pamlico Sound in North Carolina, which is a key 
fisheries nursery in the southeastern United States. Studies have shown 
that direct nitrogen deposition onto waterways feeding into the Pamlico 
Sound or onto the Sound itself and indirect nitrogen inputs via runoff 
from the upstream watersheds contribute to conditions of severe water 
oxygen depletion; formation of algae blooms in portions of the Pamlico 
Sound estuarine complex; altered fish distributions, catches, and 
physiological states; and increases in the incidence of disease. 2005 
SP at p. 6-35.
    Other studies have shown that under extreme rainfall events, 
massive influxes of reactive nitrogen (in combination with excess 
loadings of metals or other nutrients) into watersheds and sounds can 
lead to dramatic decreases of oxygen in water and the creation of 
widespread ``dead zones'' and/or increases of algae blooms that can 
cause extensive fish kills and damage to commercial fish and sea food 
harvesting. 2005 SP at p. 6-35.
    The 2005 SP indicates that there is a clear link between acidic 
water, which results from atmospheric deposition of strong acids, and 
fish mortality. Studies have shown that inputs of acid deposition to 
regions with base-poor soils have resulted in the acidification of soil 
waters, shallow ground waters, streams, and lakes in a number of 
locations with the United States. This can result in lower pH and 
higher concentrations of inorganic monomeric aluminum, which causes 
changes in chemical conditions that are toxic to fish and other aquatic 
animals.
    (c) Materials damage and soiling.
    As part of the review for setting secondary standards for PM, the 
2004 CD and 2005 SP considered the adverse effects that the deposition 
of ambient PM can have on materials such as metals, paint finishes, and 
building stone and concrete. Substantial evidence exists to show that 
ambient PM plays a role in both physical damage and impaired aesthetic 
qualities of materials. Physical damage to materials, including 
corrosion, degradation, and deterioration, is known to result from 
exposure to environmental factors such as sunlight, moisture, fungi, 
and varying temperatures; however, to the extent that particles may 
cause or contribute to physical damage of building materials, such 
damage is primarily caused by chemically active--especially particulate 
nitrates and sulfates--fine particles or hygroscopic coarse particles. 
On the other hand, particles consisting of carbonaceous compounds are 
responsible for soiling of commonly used building materials and 
culturally important items (statues, works of art, etc.) Soiling or 
exposure to PM can affect the aesthetic appeal of surfaces by giving 
them a dirty appearance, resulting in an increased frequency of 
cleaning. Nevertheless, while the role of ambient PM in specific 
adverse effects is well documented in the available studies, the 2004 
CD and 2005 SP also concluded that there remains insufficient evidence 
to establish a quantitative relationship between ambient PM and any of 
the various effects described.
    The EPA believes that these observations and the underlying 
available evidence continue to support consideration of retaining an 
appropriate degree of control on both fine and coarse particles. 
Lacking any specific quantitative basis for establishing distinct 
standards to protect against PM related to adverse effects on 
materials, EPA believes that reductions in fine and coarse particles 
likely to result from the current suite of secondary PM standards, or 
the range of recommended revisions to the primary PM standards and to 
the secondary PM2.5 standard to address visibility 
impairment, would contribute to protection against PM-related soiling 
and materials damage.
    (d) Climate and solar radiation effects.
    The effects of PM on climate result from either the scattering or 
absorption of radiation by ambient particles, resulting in a cooling or 
warming effect on climate, respectively. Studies suggest

[[Page 54133]]

that global and regional climate changes could have both positive and 
negative effects on human health and welfare, and the environment. Most 
components of ambient PM, especially sulfates, scatter and reflect 
incoming solar radiation back into space. However, some components of 
ambient PM, especially black carbon, absorb incoming solar radiation or 
outgoing terrestrial radiation. Sulfate particles indirectly affect 
climate by serving as condensation nuclei which alter the size 
distribution of cloud droplets (producing more droplets with smaller 
sizes), causing the amount of solar radiation that clouds reflect back 
to space to increase.
    While substantial qualitative information has shown the important 
role that ambient PM plays in both global and regional climatic 
processes, that role is presently poorly quantified. There are 
considerable uncertainties and difficulties in projecting likely 
climate change impacts. The 2005 SP indicates that ``any complete 
assessment of the direct radiative effects of PM would require 
computationally intensive calculations that incorporate the spatial and 
temporal behavior of particles of varying composition that have been 
emitted from, or formed by precursors emitted from, different 
sources.'' 2005 SP at 6-55. In addition, calculations of indirect 
physical effects of particles on climate are subject to much larger 
uncertainties than those related to the direct radiative effects of 
particles.
    Exposure to solar radiation may have direct effects on human health 
and agricultural and ecological systems; indirect effects on human 
health and ecosystems, and effects on materials. 2005 SP at 6-56ff. 
Several studies cited in the 2004 CD reinforce the idea that particles 
can play an important role in affecting the transmission of solar UV-B 
radiation. However, none of these studies included measurements of 
ambient PM concentrations, so that direct relationships between PM 
levels and UV-B radiation transmission could not be determined. In 
addition, the relationships between particles and UV-B radiation 
transmission can vary considerably over location, conditions, and time. 
2005 SP at 6-56. In summary, the EPA staff concluded that available 
information is insufficient to project the extent to which, or even 
whether, location-specific changes in ambient PM would indirectly 
affect human health or the environment.
e. Fundamental Elements of Increments
    As we have previously noted, under the model established in the Act 
and prior EPA regulations, the function of an increment is not like 
that of the NAAQS in that an increment is not intended to set a uniform 
ambient pollutant concentration ``ceiling'' across the United States. 
See 70 FR 59600. That is, while both increments and NAAQS generally 
serve to limit air pollution levels, increments are designed to allow a 
uniform degree of pollutant concentration increase for each area in the 
United States with a particular classification, with the allowable 
increase measured against a baseline air quality level for a particular 
area.\15\ Because the baseline air quality level varies from one 
location to another, and is not established until a PSD permit is 
submitted, it is not possible to determine what the maximum pollutant 
concentration attainable is for a given area (to be used to determine 
the protection afforded by an increment against potential adverse 
environmental effects) until the specific baseline air quality level is 
known.
---------------------------------------------------------------------------

    \15\ It should be noted, however, that an increment does not 
allow air pollution levels in an area to increase beyond the ambient 
concentration of a pollutant that would exceed the level allowed by 
the NAAQS.
---------------------------------------------------------------------------

    For the reasons described in our increments rule for 
NOX, our objective is to establish uniform increments that 
allow the same level of deterioration for each area of the country 
having the same classification. 70 FR 59601. Our goal is not to 
establish increments to reduce existing air pollutant concentrations 
below baseline levels in each area, but rather to define a level of 
increase in pollutant concentrations above baseline levels that 
represents ``significant'' deterioration for each area classification. 
70 FR 59600.
f. Evaluation of the Safe Harbor Increments
    Mindful of the considerations we previously described about the 
fundamental characteristics of the increments, we reviewed the 
scientific and technical evidence available for the 2005 review of the 
NAAQS for PM in order to determine whether, and to what extent, the 
``safe harbor'' increments might need to be modified in order to 
protect air quality values, health and welfare, and parks while 
ensuring economic growth consistent with the preservation of clean air 
resources in accordance with sections 166(c) and 160 of the Act. As we 
did in our evaluation of the safe harbor NO2 increments, we 
propose to rely on an approach that evaluates how protective the safe 
harbor PM2.5 increments are by trying to compare the 
marginal pollutant concentration increases allowed by the safe harbor 
increment levels against the pollutant concentrations at which various 
environmental responses occur. We analyzed the available evidence from 
both a quantitative and qualitative perspective to reach a decision 
about whether we should modify the contingent safe harbor 
PM2.5 increments and whether we have sufficient information 
to select a specific alternative level, averaging time, or pollutant 
indicator for the increments.
(1) Non-Visibility Related Effects
    In quantitatively evaluating the adequacy of the contingent safe 
harbor increments for PM2.5 for non-visibility related 
welfare effects, we experienced difficulties with identifying the 
appropriate indicator, as well as to the level of the increments. In 
the most recent evaluation of the NAAQS for PM, EPA staff concluded 
that ``sufficient information is not available at this time to 
recommend consideration of either an ecologically based indicator or an 
indicator based distinctly on soiling and materials damage, in terms of 
specific chemical components of PM.'' 2005 SP at 7-15. For 
consideration of the effects of ambient PM on vegetation and other 
ecosystems, the available data indicate that the chemical species of PM 
(especially particulate nitrate and sulfate) has more relevance than 
the size fraction (coarse or fine). Acid precipitation, including 
particulate sulfate, has been found to be particularly damaging to 
foliage, and along with ambient SO2 contributes 
significantly to materials damage and soiling.
    Determining the most effective levels for any indicator for PM from 
the available data is difficult because the evidence is insufficient to 
provide a quantitative relationship between ambient PM concentrations 
and known and observed adverse ecological effects. Fundamental areas of 
uncertainty preclude establishing predictable relationships between 
ambient concentrations of particulate nitrogen and sulfur compounds and 
associated ecosystem effects. One source of uncertainty hampering the 
characterization of such relationships is the extreme complexity and 
variability that exist in estimating particle deposition rates. These 
rates are affected by numerous factors, including particle size and 
composition, associated atmospheric conditions, and the properties of 
the surfaces being impacted. A related source of uncertainty is 
establishing the portion of the total nitrogen and sulfur deposition 
occurring at a given site is attributable to ambient PM. Though several 
national

[[Page 54134]]

deposition monitoring networks have been successfully measuring wet and 
dry deposition for several decades, they often do not distinguish the 
form (e.g., particle, wet, and dry gaseous) in which a given chemical 
species is deposited. Further, it is not clear how well data from 
monitoring sites may apply to non-monitored sites with different 
surface cover, meteorology, or other deposition related factors.
    Another fundamental problem that makes it difficult to establish a 
meaningful dose-response relationship between ambient PM levels and 
specific adverse environmental effects is that ecosystems have 
different sensitivities and capacities to buffer or assimilate 
pollutants. Many of the documented ecosystem-level effects only became 
evident after long-term, chronic exposures to total annual loads of 
reactive nitrogen (Nr) or acidifying compounds that eventually exceeded 
the natural buffering or assimilative capacity of the system. In most 
cases, PM deposition is not the only contributor to the total load of 
Nr or acidifying compounds entering the affected system. Since it is 
difficult to predict the rate of PM deposition, and thus, the PM 
contribution to total deposition at a given site, it is difficult to 
predict the ambient concentration of PM that would likely lead to the 
observed adverse effects within any particular ecosystem. Equally 
difficult is the prediction of recovery rates for areas already 
affected, if PM deposition rates of various chemical species were to be 
reduced.
    In response to our 2005 proposal for NO2 increments, 
some commenters expressed the opinion that a better way of identifying 
acceptable pollutant loadings, particularly for protection against 
ecological effects, is the use of a ``critical load'' concept.\16\ 70 
FR 59612. At that time, EPA expressed support for the concept, but 
indicated that our current knowledge about critical loads did not 
``provide a sufficient basis for establishing a uniform, national 
standard such as a PSD increment.''
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    \16\ A ``critical load'' is a numerical estimate of the amount 
of polloution that a sensitive ecosystem can absorb on a sustained 
basis before it experiences a measurable amount of degradation. In 
contrast to the units for increments, [mu]/m\3\, a critical load is 
typicallly expressed as a loading rate in kilograms of a pollutant 
per hectare per year.
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    The critical load concept was once again reviewed in the 2005 SP 
for PM. It was noted in that document that the ``[k]ey to the 
establishment of a critical load is the selection of appropriate 
ecological endpoints or indicators that are measurable characteristics 
related to the structure, composition, or functioning of ecological 
systems (i.e., indicators of condition).'' 2005 SP at 6-46. The EPA 
recognized the value of using critical loads and acknowledged that a 
number of different groups in the United States have begun to use or 
develop critical loads. Nevertheless, while recognizing that current 
activities ``hold promise,'' EPA concluded that ``widespread use of 
[critical loads] in the U.S. is not yet possible.'' Among other things, 
currently available data are insufficient to quantify the contribution 
of ambient PM to total Nr or acid deposition, and it is not clear 
whether a critical load could be developed just for the portion of the 
total N or S input that is contributed by PM. SP at 4-49. Research, in 
conjunction with the development of improved predictive models, could 
help in future consideration within the United States of the critical 
loads concept, and in determining how much of any given critical load 
is contributed by different sources of pollutants.
    As explained earlier, the available scientific and technical data 
do not yet enable us to adequately relate ambient concentrations of 
PM2.5 to ecosystem responses. Without such key information, 
it is difficult to quantitatively evaluate the effectiveness of the 
``safe harbor'' increments for protecting air quality values, health 
and welfare, and parks while ensuring economic growth consistent with 
the preservation of clean air resources. Alternatively, we must make a 
qualitative judgment as to whether the contingent safe harbor 
increments for PM2.5 or some alternative increments meet the 
applicable factors.
    In this situation, we believe that the determination of the 
increment levels that satisfy the factors applicable under section 
166(c) is ultimately a policy choice that the Administrator must make, 
similar to the policy choice the Administrator must make in setting a 
primary NAAQS ``with an adequate margin of safety.'' See Lead 
Industries Ass'n v. EPA, 647 F.2d 1130, 1147 (D.C. Cir. 1980) (where 
information is insufficient to permit fully informed factual 
determinations, the Administrator's decisions rest largely on policy 
judgments). Using a similar approach is warranted because both section 
109 and section 160(1) direct the Administrator to use his or her 
judgment in making choices regarding an adequate margin of safety or 
protecting against effects that may still occur notwithstanding 
compliance with the NAAQS--both areas of inquiry characterized by great 
uncertainty. Thus, in the process for setting NAAQS, the Administrator 
looks to factors such as the uncertainty of the science, the 
seriousness of the health effects, and the magnitude of the 
environmental problem (isolated or commonplace). E.g., 62 FR 38652 
(July 18, 1997) (PM2.5 NAAQS).
    Bearing on this policy decision for increments are various 
considerations, based on the available information and the factors 
applicable under section 166(c). The factors establishing particular 
environmental objectives (protecting air quality values, health and 
welfare, and parks) might suggest that, in some areas, we permit little 
or no increase in PM2.5 emissions or establish an increment 
for another form of PM because there are data indicating that an effect 
may be attributable to PM emissions. However, as explained in the 
NOX rule, we do not believe that Congress intended for the 
PSD program to eliminate all negative effects. Thus, rather than just 
seeking to eliminate all negative effects, we must attempt to identify 
a level of increase at which any additional effects beyond existing (or 
baseline) levels would be ``significant'' and protect against those 
``adverse'' effects. Furthermore, we need to ensure that our increments 
provide room for some economic growth. Congress intended for EPA to 
weigh these considerations carefully and establish regulations that 
balance economic growth and environmental protection.
    Since we are unable to establish a direct, widely applicable, 
quantitative relationship between particular levels of PM2.5 
and specific negative effects, we give particular weight to the policy 
judgment that Congress made when it set the statutory increments as a 
percentage of the NAAQS and created increments for the same pollutant 
form and time period that was reflected in the NAAQS. In section 166 of 
the Act, Congress directed that EPA study the establishment of PSD 
regulations for other pollutants for which Congress did not wish to set 
increments at the time.
    Congress's own reluctance to set increments to prevent significant 
deterioration of air quality due to emissions of NOX, and 
the provisions ensuring time for Congressional review and action, 
suggest that Congress intended for EPA to avoid speculative judgments 
about the science where data are lacking. Thus, in the absence of 
specific data showing that an increment level that of the ``safe 
harbor'' level would better protect health, welfare, parks, and air 
quality values, while simultaneously maximizing opportunities for 
economic growth, we give weight in our qualitative analysis of the 
factors applicable under section

[[Page 54135]]

166(c) to the method that Congress used to establish the statutory 
increments.
    In making this qualitative judgment, we also consider the overall 
regulatory framework that we have established in the PSD regulations 
for PM2.5. This framework includes a case-by-case analysis 
of each permit application to identify additional impacts (e.g., soils 
and vegetation), a special review by the FLM and State reviewing 
authority of potential adverse effects on air quality values in parks 
and special areas, and a requirement that all new and modified sources 
install BACT. In addition, the area classification system ensures that 
there will be economic growth in particular areas that is consistent 
with the values of each State and its individual communities. Based on 
this qualitative analysis, we do not believe it is necessary to adopt 
more stringent increments to satisfy section 166(c) of the Act with 
respect to non-visibility related effects.
(2) Visibility Protection
    In the case of visibility protection, the available evidence was 
strong enough to enable EPA to conclude that PM2.5 is the 
appropriate indicator for measuring the effects of ambient PM on 
visibility impairment. Accordingly, using PM2.5 
concentrations as the basis for review, EPA evaluated a range of 
PM2.5 ambient concentrations, averaging times (24 hours and 
less), and a range of concentration percentiles (using a concentration-
based form for the standard) in order to establish a recommendation for 
setting the secondary NAAQS for PM to address visibility impairment in 
urban areas. As explained in the 2005 SP, EPA considered, as a lower 
bound for setting the short-term secondary PM2.5 standard, a 
PM2.5 concentration of either 20 or 25 [mu]g/m\3\, averaged 
over a 4- to 8-hour averaging time within daylight hours, depending on 
the percentile range considered for the form of the standard.
    The Class II, short-term safe harbor increment for PM2.5 
is 9 [mu]g/m\3\. This level is well below the lower bound recommended 
for setting the secondary PM2.5 standard, but is based on a 
24-hour averaging time at the 98th percentile. The 2005 SP also notes 
that the estimated 98th percentile values in distributions of daily 
background levels are below 10 [mu]g/m\3\ in most areas. Thus, the 
allowable deterioration from the safe harbor increment in addition to 
the natural background level generally falls below the minimum values 
recommended in the 2005 SP for the secondary short-term standard for 
PM2.5.
    With regard to the Class I increments for PM2.5, we note 
that Congress explicitly included visibility as an air quality related 
value (AQRV), enabling Federal land managers to protect significant 
attributes of Federal Class I areas. Act section 165(d)(2)(B). The FLM, 
assigned the affirmative responsibility to protect Federal Class I 
areas, are to use AQRVs which are separate and distinct from 
increments, to address individual Class I areas and the unique 
attributes identified for each Class I area. Congress recognized that 
AQRVs and increments were not the same thing and established 
independent procedures for the implementation of each. For example, the 
Act authorizes FLM to evaluate the effects of pollutant increases using 
AQRVs as the basis regardless of the effect of such pollutant increases 
on the increments. In using the AQRV, FLM are not limited in their 
evaluation by the maximum allowable pollutant increase set by the 
increment and may identify adverse impacts on visibility pursuant to 
AQRVs even when the pollution increase will not cause or contribute to 
an exceedance of an increment. Instead, the pollutant increase is 
evaluated against the AQRV which considers the specific conditions 
existing in the Class I area of concern. Thus, regardless of the 
increased amount of pollution that an increment may allow, the FLM may 
determine that the visibility in the Class I area is adversely affected 
by an amount of pollutant increase less than that allowed by the 
increment.
    From a qualitative perspective, we believe that visibility 
protection in Class I areas is more adequately provided by the AQRV 
process, where each area can be addressed on the basis of the local 
situation and the FLM's assessment of potential ambient impacts by a 
particular source. Nevertheless, generally speaking an increment should 
not be so large that it routinely results in substantially more 
pollution in Class I areas than is generally acceptable under the AQRV 
approach. The contingent safe harbor PM2.5 increments for 
Class I areas are 1 [mu]g/m\3\ and 2 [mu]g/m\3\ for the annual and 24-
hour averaging periods, respectively.
    We believe the importance of using distinct PM2.5 
increments to protect against visibility impairment is also lessened by 
the fact that Congress, aware of the statutory requirements for 
prevention of significant deterioration of air quality, established 
several visibility programs that specifically target emissions 
reductions to achieve the desired visibility benefits. Under the 
regional haze regulations, promulgated by EPA in 1999, States are 
required to establish goals for improving visibility on the 20 percent 
most impaired days in each Class I area, and for allowing no 
degradation on the 20 percent least impaired days. Each State must 
adopt emission reduction strategies which, in combination with the 
strategies of contributing States, assure that Class I area visibility 
improvement goals are met. Five multi-state planning organizations are 
evaluating the sources of PM2.5 contributing to Class I area 
visibility impairment to lay the technical foundation for developing 
strategies, coordinated among many States, in order to make reasonable 
progress in Class I areas across the United States.
    We believe it is also important to consider the fact that some 
State and local governments have also developed programs to improve 
visual air quality in specific urban areas. These programs are 
individually designed to focus on improving visibility to a visual 
range defined by the specific area of concern. Such local programs can 
more appropriately focus on the preferences of individual communities 
where a uniform national increment for visibility protection generally 
cannot.
    In setting the NAAQS for PM, EPA ultimately concluded that a 
distinct secondary standard with a different averaging time or form was 
not warranted at that time. Instead, we concluded that a set of 
secondary PM2.5 standards set identical to the revised 
primary PM2.5 standards a reasonable approach when 
considered in conjunction with the regional haze program as a means of 
achieving appropriate levels of visibility protection in urban, non-
urban, and Class I areas across the United States. With regard to 
evaluating the safe harbor increments for PM2.5, we had to 
consider how much weight to give to visibility protection as a function 
of the increments. That is, whether the increments were the appropriate 
means of providing the most effective protection against visibility 
impairment in urban areas as well as in rural areas, including Federal 
Class I areas. In light of the other more direct approaches being used 
to address visibility problems across the United States, we believe 
that the use of distinct PM increments for visibility protection is not 
the most effective means of addressing the visibility problem. Thus, we 
do not believe it is necessary to modify the safe harbor increments for 
PM2.5 to further protect visibility.

[[Page 54136]]

3. Proposed Baseline Dates for PM2.5 Increments Under Option 
1
    If we adopt option 1, we propose to require the implementation of 
the PM2.5 increment system with new baseline areas, baseline 
dates and trigger dates. Specifically, we are proposing that the major 
source baseline date and trigger date, both fixed dates, will be 
defined as the effective date of this rule after promulgation.
    In light of current and expected trends in PM2.5 
concentrations, EPA's judgment is that starting with new baseline dates 
on or after the effective date of this rule would make the new PSD 
increments more protective. Under our proposed approach, any emissions 
reductions occurring prior to the effective date of this rule would be 
counted toward the baseline concentration rather than expanding the 
PM2.5 increment. If a retroactive baseline date were to 
apply, emissions reductions occurring prior to the effective date of 
this rule would serve to expand the available increments, enabling more 
pollution than would otherwise be allowed to occur.
    In addition, we believe starting with new baseline dates to 
implement new increments for PM2.5 is appropriate under this 
option because we would treat PM2.5 essentially as a ``new'' 
pollutant for purposes of PSD and section 166 of the Act. We believe 
that establishing a new baseline overcomes significant implementation 
concerns that would otherwise exist if the existing PM baseline were 
maintained. If we were to require sources and reviewing authorities to 
conduct PM2.5 increment analyses based on the minor source 
baseline dates previously established under the TSP or PM10 
program, they would have to attempt to recreate the PM2.5 
emissions inventory as of the minor source baseline date in order to 
determine the baseline PM2.5 concentration for the area. For 
early minor source baseline dates in particular (e.g., 1976 in areas of 
the United States), establishing the emissions inventory for PM2.5 
would be extremely difficult, cumbersome and potentially inaccurate 
because historic emissions inventories did not include PM2.5 
emissions. For all of these reasons, we are proposing option 1 as our 
preferred option and request comment on this contingent safe harbor 
approach under option 1
4. Revocation of PM10 Annual Increments
    If we use option 1 to adopt additional increments for 
PM2.5, we propose to revoke the annual increments for 
PM10 based on the same technical evidence that led us to 
revoke the annual PM10 NAAQS. As discussed earlier, we do 
not believe EPA is precluded from adopting new particular matter 
increments under section 166(a) of the Act because we promulgated a 
NAAQS for PM2.5 after 1977. However, if we read section 
166(f) to address PM10 alone, the interaction of sections 
166(a) and 166(f) could suggest that pollutant-specific PSD regulations 
for PM promulgated on the basis of section 166(a) must be limited to 
regulations that address fine PM. However, this view would create 
tension with language in section 166(a) that calls for us to conduct a 
holistic evaluation to establish a system of PSD regulations (including 
numerical and other measures) for each pollutant covered by this 
provision. Since it would be preferable to develop a system of 
regulation for PM generally and select the appropriate indicator for PM 
increments based on a comprehensive review of the effects of all forms 
of PM (as we did in the recent NAAQS rule), we do not believe Congress 
could have intended to constrain EPA's discretion to consider the 
potentially differing effects of coarse and fine particles when 
developing pollutant-specific PSD regulations under section 166(a).
    Since EPA recently revised the NAAQS for PM10 and 
eliminated the annual PM10 NAAQS, we believe it is 
permissible for the Agency to interpret the phrase ``pollutants for 
which national ambient air quality standards are promulgated after 
August 7, 1977'' to apply to revisions to PM10 as well. In 
our 1989 proposal to adopt PM10 increments, before the 
addition of section 166(f) to the Act, we construed the language in 
section 166(a) to be broad enough to support adoption of PM10 
increments. Under a holistic approach, considering all forms of PM, we 
do not believe the evidence supports retaining an annual increment for 
PM10 under the PSD program. In our October 17, 2006 action 
on the PM NAAQS, the Administrator concluded that an annual coarse 
particle NAAQS was not warranted at this time. 71 FR 61198-99. The CD 
concluded that the available evidence does not suggest an association 
of adverse health effects with long-term exposure to coarse particles 
and the SP concluded there is no quantitative evidence that directly 
supports an annual standard. Id. at 61198. With respect to welfare 
effects, the evidence indicated that a short-term PM2.5 
standard was the best approach for addressing visibility. Id. at 61280. 
For non-visibility welfare effects, the Administrator concluded that 
the available evidence was not sufficient to support an additional 
indicator, but that a secondary NAAQS identical to the primary NAAQS 
directionally improves the level of protection afforded vegetation, 
ecosystems, and materials. Id. at 61210.
    When the evidence described in the Criteria Document and Staff 
Paper is considered in light of the legal criteria applicable under 
section 166(c), we believe it supports the conclusion that an annual 
PM10 increment is no longer needed under the PSD program. In 
the absence of a clear association between long-term exposure to coarse 
particles and adverse health effects, we do not see a justification for 
an annual PM10 increment to protect public health, 
notwithstanding compliance with the NAAQS. In addition, the new 
increments for PM2.5 that we propose to adopt, in 
combination with the existing 24-hour increment for PM10, 
will address welfare effects, air quality related values, and air 
quality in national parks and other special areas. As described 
earlier, visibility impacts are principally attributable to short-term 
fine particle concentrations and thus will be addressed by the new 
short-term PM2.5 increment. The evidence indicates that the 
non-visibility welfare effects of concern are primarily attributable to 
deposition of sulfate and nitrate particles of any size. Thus, the 
combination of the new PM2.5 increments and the existing 24-
hour PM10 increment will address non-visibility welfare 
impact attributable to deposition. Since we propose to retain the 24-
hour PM10 increment and adopt new annual and 24-hour fine 
particle increments that will target all of these effects, we do not 
consider it warranted to require continued tracking of changes in 
annual concentrations of PM10 under the PSD program.

B. Option 2--Equivalent Substitution Approach for Annual Increments--
Section 166(f)

    Under this option, we would recognize PM2.5 as a new 
indicator for PM for NSR purposes, and develop annual PM2.5 
increments to replace the annual PM10 increments using the 
equivalent substitution approach under the authority of section 166(f) 
of the Act.
    The approach proposed under this option in this proposed rule would 
be similar to the one we used in 1993, and discussed earlier to convert 
from TSP increments to PM10 increments, to avoid having to 
implement increments based on standards that no longer existed. On 
October 17, 2006, EPA revoked the primary and secondary annual 
PM10 standards and retained the primary and

[[Page 54137]]

secondary 24-hour PM10 standards. 71 FR 61144.
    In this case, we therefore are developing annual PM2.5 
increments to replace the annual PM10 increments. Also, 
consistent with our prior action in 1993, we are proposing to eliminate 
or revoke the PM10 increments in this notice. However, for 
developing the 24-hour PM2.5 increments, we are proposing to 
use the increment values derived under the contingent safe harbor 
approach explained in option 1. We seek comment not only on the levels 
of the proposed ``equivalent'' increments, but also on our use of this 
equivalent increment option for only the annual PM2.5 
increments. In addition, we seek comment on whether we should rely on 
section 166(f) to also propose the 24-hour PM2.5 increments, 
even though the primary and secondary 24-hour PM10 NAAQS are 
not being revoked.
1. Development of Equivalent Increments
    To establish equivalent PM10 increments in the 1993 
rule, EPA compared the TSP and PM10 impacts of each of the 
249 major sources subject to major NSR in our NSR database. EPA 
observed that, in principle, for any source the equivalent PM10 
increments was simply the product of the TSP increment to the source's 
PM10/PM emissions ratio. 58 FR 31627.
    In this rulemaking, EPA proposes to apply the same type of ratio 
approach to establish equivalent increments for PM2.5 under 
section 166(f) of the Act. Unlike the 1993 analysis where we evaluated 
a database of 249 major sources, for this rulemaking EPA relied on a 
more comprehensive analysis of the ``2001 National Emissions Estimates 
by Source Categories'' for PM10 and PM2.5.\17\ 
From the 2001 National Emissions Inventory, the ratio of emission 
estimates from utilities and industrial point source categories were 
used to find the PM2.5 to the PM10 emissions 
ratio. For purposes of deriving the ratio, area sources and non-road 
and mobile sources were not included on the basis that for NSR 
permitting virtually all of the permitted sources fall within the 
utility and industrial point source categories.
---------------------------------------------------------------------------

    \17\ 2001 National Emissions Estimates by Source Categories.
---------------------------------------------------------------------------

    Utilities and industrial point source emission estimates were 
combined and a ratio of 0.8 was calculated as the ratio of emissions of 
PM2.5 to PM10. Hence, the annual increments 
developed for PM2.5 would be equal to 0.8 multiplied by the 
increment value for PM10. Although we believe that this 
approach is based on a permissible interpretation of the statute, we 
believe it results in increment values for PM2.5 that are 
much higher than the values Congress envisioned when it established the 
original increments for PM and SO2 based on percentages of 
the then existing NAAQS. For example, an annual PM2.5 
increment in Class II areas using this approach would be 13 [mu]g/m 
\3\, which is 87 percent of the annual PM2.5 NAAQS of 15 
[mu]g/m \3\. In contrast, Congress established the Class II Increments 
for PM and SO2 to represent 25 percent of the NAAQS. To 
avoid such an unreasonable outcome for PM2.5, we rejected 
this approach and instead are proposing two variations (options 2A & 
2B) of the equivalent increment approach as the second and third 
option.
2. Proposed Annual Increments for PM2.5
a. Option 2A
    In addition to an emissions ratio to reflect the shift in the 
indicator from PM10 to PM2.5, we have also 
considered the shift in the stringency of the NAAQS that resulted when 
we changed the pollutant indicator from PM10 to 
PM2.5. Accordingly, the ratio of emissions (0.8) that we 
previously calculated would be multiplied by the ratio of the 
PM2.5 NAAQS over the PM10 NAAQS (15/50 = 0.3 
[mu]g/m \3\ for the annual standard) to derive an adjustment factor 
(0.24 for the annual NAAQS) for calculating the Class I, II, and III 
annual PM2.5 increments. Hence, multiplying the Class I, II, 
and III annual PM10 increments, 4, 17, and 34 [mu]g/m \3\, 
respectively, by the new adjustment factor yields the following 
proposed increment values (rounded to the nearest whole number) under 
option 2A:

------------------------------------------------------------------------
                                NAAQS        Increments ([mu]g/m \3\)
      Averaging period         [mu]g/m  --------------------------------
                                 \3\)     Class I    Class II  Class III
------------------------------------------------------------------------
Annual......................         15          1          4          8
24-hr.......................         35          2          9         18
------------------------------------------------------------------------

    Coincidentally, this new adjustment based on the PM2.5-
to-PM10 NAAQS ratio results in annual PM2.5 
increment values identical to the values derived using option 1, the 
percentage-of-NAAQS approach. As stated earlier, because the 24-hour 
PM10 NAAQS have not been revoked, we do not consider section 
166(f) to be the best fit for the development of the 24-hour PM2.5 
increments. Thus, for new 24-hour PM2.5 increments, we are 
proposing to rely on the authority of section 166(a) to derive 24-hour 
increments as proposed under option 1.
b. Option 2B
    This option represents another variation on the section 166(f) 
equivalent increment approach. Under this option 2B, we are proposing 
to develop annual PM2.5 increments based solely on the ratio 
of the annual PM2.5 NAAQS to the primary annual 
PM10 NAAQS (15/50 = 0.3 [mu]g/m \3\ for the annual NAAQS). 
The values for the annual PM2.5 increments derived by 
multiplying the Class I, II, and III annual PM10 increments, 
4, 17, and 34 [mu]g/m \3\, respectively, by this adjustment ratio 
yields the following proposed increment levels (rounded to the nearest 
whole number) under option 2B:

------------------------------------------------------------------------
                                NAAQS       Increments  ([mu]g/m \3\)
      Averaging period         ([mu]g/m --------------------------------
                                 \3\)     Class I    Class II  Class III
------------------------------------------------------------------------
Annual......................         15          1          5         10

[[Page 54138]]


24-hr.......................         35          2          9         18
------------------------------------------------------------------------

    As with option 2A, for the 24-hour PM2.5 increments, we 
are proposing to use increment values developed via the contingent safe 
harbor approach as described in option 1.
3. Baseline Dates
    Under these options (2A and 2B), since we will be replacing annual 
PM10 increments with annual PM2.5 increments, we 
propose to retain the existing TSP/PM10 baseline and trigger 
dates and baseline areas for the PM2.5 program. Section 
166(f) does not address how EPA should handle baseline dates for a 
substituted increment. In 1993, we decided to retain the existing 
baseline dates for TSP when we replaced the section 163 increment with 
PM10 increments. We propose the same approach under this 
option in this rulemaking because the continuation of the historic TSP/
PM10 baseline dates would ensure that no past case of 
increment consumption is abandoned and serve as the closest measure of 
a substitute. However, as discussed earlier, given PM2.5 
emissions trends, our judgment is that establishing baseline dates for 
PM2.5 after the effective date of this rule may be more 
effective at preventing significant deterioration because the baseline 
concentrations will reflect emissions reductions. We request comment on 
whether this would provide sufficient justification for EPA to 
establish new baseline dates under the section 166(f) substitution 
approach.
    However, in conjunction with the annual PM2.5 increments 
discussed above, we are proposing to use option 1 increment levels for 
24-hour PM2.5 increments which would use new baseline areas, 
trigger and baseline dates. Thus, assuming the baseline date for the 
PM10 increments has already been triggered, this results in 
different baseline dates for the annual and 24-hour PM2.5 
increments. This would also require a PSD applicant to develop two 
separate emissions inventories of increment-consuming sources for 
evaluating a new source's cumulative PM2.5 impacts in the 
area of concern. We seek comment on this issue of multiple inventories 
under the equivalent increments approach.

VI. Significant Impact Levels (SILs)

A. EPA's Guidance on SILs in the PSD Program

    Significant Impact Levels or SILs are numeric values derived by EPA 
that may be used to evaluate the impact a proposed major source or 
modification may have on the NAAQS or PSD increment. The SILs currently 
appear in EPA's regulations in 40 CFR 51.165(b), which are the 
provisions that require States to operate a preconstruction review 
permit program for major stationary sources that wish to locate in an 
attainment or unclassifiable area but would cause or contribute to a 
violation of the NAAQS. The SILs in that regulation are the level of 
ambient impact that is considered to represent a ``significant 
contribution'' to nonattainment.
    Although 40 CFR 51.165 is the regulation that establishes the 
minimum requirements for nonattainment NSR programs in SIPs, the 
provisions of 40 CFR 51.165(b) are actually applicable to sources 
located in attainment and unclassifiable areas. See 40 CFR 
51.165(b)(4). Where a PSD source located in such areas may have an 
impact on an adjacent non-attainment area, the PSD source must still 
demonstrate that it will not cause or contribute to a violation of the 
NAAQS in the adjacent area. This demonstration may be made by showing 
that the emissions from the PSD source alone are below the significant 
impact levels set forth in 40 CFR 51.165(b)(2). However, where 
emissions from a proposed PSD source or modification would have an 
ambient impact in a non-attainment area that would exceed the SILs, the 
source is considered to cause or contribute to a violation of the NAAQS 
and may not be issued a PSD permit without obtaining emissions 
reductions to compensate for its impact. 40 CFR 51.165(b)(2)-(3).
    The EPA has also applied SILs in other analogous circumstances 
under the PSD program. Based on EPA interpretations and guidance, SILs 
have also been widely used in the PSD program as a screening tool for 
determining when a new major source or major modification that wishes 
to locate in an attainment or unclassifiable area must conduct a more 
extensive air quality analysis to demonstrate that it will not cause or 
contribute to a violation of the NAAQS or PSD increment in the 
attainment or unclassifiable area. SILs are also used to define the 
extent of the Significant Impact Area (SIA) where a cumulative air 
quality analysis accounting for emissions changes from all sources in 
the SIA is performed.
    The EPA's historical application of SILs to the analysis of major 
source impacts on attainment and unclassifiable areas under the PSD 
program has largely been based on interpretations reflected in EPA 
guidance memorandum. The EPA has not previously incorporated the 
concept of a SIL into our PSD regulations at 40 CFR 51.166 and 40 CFR 
52.21. Nevertheless, EPA has long considered the ``significant 
contribution'' test set forth in 40 CFR 51.165(b)(2) to apply to the 
impact of PSD sources on attainment areas as well, since that provision 
applies to major new sources and major modifications located in 
attainment and unclassifiable areas. Thus, EPA has also supported the 
use of SILs as screening mechanism when analyzing whether a source 
located in a PSD area will cause or contribute to a violation of the 
NAAQS or PSD increment in attainment or unclassifiable areas.
    Although EPA's current PSD regulations do not contain SILs, EPA 
initially developed SILs for TSP and other pollutants under the PSD 
program in 1978. 43 FR 26380 (June 19, 1978). In the preamble to our 
1978 regulations, EPA described SILs as a screening technique to 
alleviate resource burdens (the costs and time involved in 
sophisticated computer modeling of ambient air impacts) where there was 
little or no threat to the PSD increments or NAAQS. 45 FR 26398. 
However, as the threat to the increments increased, EPA intended for 
more sophisticated techniques to be used. Id. Since EPA's analysis 
indicated that the air quality impact of many sources fell off rapidly 
to insignificant levels, the Agency did not intend to analyze the 
impacts beyond the geographic point where the concentrations from the 
source fell below certain levels derived from the class I increments. 
Id. These levels were interpreted by EPA as representing the minimum 
amount of ambient impact that is significant and hence came to be

[[Page 54139]]

known as the significant impact levels or SILs. Id.
    When EPA substantially revised our PSD regulations in 1980 to 
include significant emissions rates and significant monitoring 
concentrations, EPA did not include the SILs in our PSD regulations. At 
that time, EPA felt that there was no need for a separate table of SILs 
because of the adoption of ``a de minimis exclusion for monitoring'' 
otherwise known as SMCs (described later). 45 FR 52707. In addition, 
EPA saw little value in retaining SILs as an exemption from the air 
quality analysis because the demonstration necessary to qualify for the 
exemption was itself an air quality analysis. 45 FR 52707.
    Subsequently, in draft guidance for permit writers, EPA advised 
that SILs may be used to determine whether a source needs to conduct a 
cumulative or ``full'' impact analysis to demonstrate that in 
conjunction with all other increment consuming sources, it will not 
cause or contribute to violation of the NAAQS or PSD increment in an 
attainment or unclassifiable areas. New Source Review Workshop Manual, 
at C.24-C.25 (Draft 1990); See also 40 CFR 51.166(k); 40 CFR 52.21(k). 
Permitting authorities followed this guidance, and this approach 
remains an accepted aspect of PSD program implementation. If based on a 
preliminary impact analysis, a source can show that its emissions alone 
will not increase ambient concentrations by more than the SILs, EPA 
considers this to be a sufficient demonstration that a source will not 
cause or contribute to a violation of the NAAQS or increment.
    In light of the unique air quality considerations in Class I areas, 
EPA has drawn a distinction between the use of SILs in Class II areas 
and Class I areas. The EPA's draft 1990 guidance only identified SILs 
to be used in Class II areas under the PSD program. Workshop Manual at 
C.28. However, in 1991, EPA advised the State of Virginia that the 
concept of a SIL might be applied to Class I areas if the levels were 
determined in a reasonable manner. Memorandum from John Calcagni, Air 
Quality Management Division, to Thomas J. Maslany, Air, Radiation, and 
Toxics Divisions (Sept. 10, 1991). The EPA did not support the use of 
SILs to determine whether a source should conduct an analysis of its 
impact on air-quality related values (AQRVs). Since there are currently 
no Class III areas for PSD in the United States, there has been no need 
for EPA to apply SILs in these areas.

B. Legal Basis for SILs

    The concept of a significant impact level is grounded on the de 
minimis principles described by the court in Alabama Power Co. v. 
Costle, 636 F.2d 323, 360 (D.C. Cir. 1980). In this case reviewing 
EPA's 1978 PSD regulations, the court recognized that ``there is likely 
a basis for an implication of de minimis authority to provide exemption 
when the burdens of regulation yield a gain of trivial or no value.'' 
636 F.2d at 360. Based on this de minimis principle from the court's 
opinion, EPA developed significant emissions rates and significant 
monitoring concentrations in our 1980s regulations for PSD. The 
significant emission rates reflect levels below which EPA considers an 
emissions increase to be de minimis and thus not a major modification 
that requires a PSD permit or NA-NSR permit. 45 FR 52676, 52705-07. See 
also 40 CFR 51.166(b)(23); 40 CFR 52.21(b)(23). As discussed further 
later, the significant monitoring concentrations in EPA regulations 
define a de minimis level of impact that EPA has concluded does not 
justify collecting pre-construction monitoring data for purposes of an 
air quality impact analysis. 45 FR 52710.
    Similarly, significant impact levels are intended to identify a 
level of ambient impact on air quality concentrations that EPA regards 
as de minimis. The EPA considers a source whose individual impact falls 
below a SIL to have a de minimis impact on air quality concentrations. 
Thus, a source that demonstrates its impact does not exceed a SIL at 
the relevant location is not required to conduct more extensive air 
quality analysis or modeling to demonstrate that its emissions, in 
combination with the emissions of other sources in the vicinity, will 
not cause or contribute to a violation of the NAAQS at that location. 
In light of insignificance of the ambient impact from the source alone, 
EPA considers the conduct of a cumulative air quality analysis and 
modeling by such a source to yield information of trivial or no value 
with respect to the impact of the proposed source or modification. The 
EPA's Environment Appeals Board has recently reiterated and affirmed 
EPA's interpretation of the Act to allow EPA to evaluate the 
significance of a source's impact when determining whether it would 
``cause or contribute'' to a NAAQS or increment violation under section 
165(a)(3) of the Act. In Re: Prairie State Generating Company, PSD 
Appeal No. 05-05, slip op. at 139-144 (Aug. 24, 2006).
    Thus, in developing SILs for this proposal, EPA sought to derive 
SILs for PM2.5 utilizing methods that would identify levels 
representing a de minimis or insignificant impact on ambient air 
quality. In choosing among the options set forth later, EPA proposes to 
select an option that reflects the degree of ambient impact on 
PM2.5 concentrations that can be considered truly de minimis 
and would justify no further analysis or modeling of the air quality 
impact of a source in combination with other sources in the area 
because the source would not cause or contribute to an exceedance of 
the PM2.5 NAAQS or the PM2.5 increments 
established elsewhere in this proposal.

C. Relationship of SILs to AQRVs

    We wish to emphasize that consistent with the original purpose of 
the Class I SILs, the Class I SILs for PM2.5 we are 
proposing are not intended to serve as thresholds for determining the 
need for an AQRV analysis or whether an adverse impact on an AQRV will 
occur. An adverse impact on an AQRV depends upon the sensitivity of the 
particular AQRV. An ambient concentration that is considered 
insignificant for purposes of increment consumption should not 
automatically be considered inconsequential relative to the inherently 
fact-specific demonstration upon which an adverse impact on an AQRV is 
to be based. Accordingly, the fact that a source's predicted impact is 
less than the SIL in a Class I area would neither relieve the source 
from having to complete an analysis of impacts on AQRVs nor 
automatically allow the reviewing authority to reject the FLM's 
demonstration of adverse impact on an AQRV. See 61 FR at 38292.

D. Proposed Options for PM2.5 SILs (for PSD and NA-NSR)

    We are seeking comment on the relative merits of each of the 
following options for setting PM2.5 SILs.
1. Option 1. Propose SILs Using the Approach We Proposed for 
PM10 in 1996
    The first option that we are proposing utilizes the same approach 
we proposed for PM10 in the 1996 NSR Reform proposal. For 
Class I areas we would set the SIL to 4 percent of the Class I 
PM2.5 increment. For Class II and Class III areas, we would 
codify the SIL values of 1.0 [mu]g/m \3\ for the annual averaging 
period and 5.0 [mu]g/m \3\ for the 24-hour averaging period, that 
already exist for PM10 in 40 CFR 51.165(b)(2). If we adopt 
this option, we would set the Class I SILs based on the Class I 
increments

[[Page 54140]]

that we elect to adopt under the increment options. Based on the Class 
I increment values proposed in the percent of NAAQS increment option 1, 
the SILs under this option would be as follows:

------------------------------------------------------------------------
                               Class I         SILs  ([mu]g/m \3\)
                              increment --------------------------------
      Averaging period         ([mu]g/m
                                 \3\)     Class I    Class II  Class III
------------------------------------------------------------------------
Annual......................          1       0.04        1.0        1.0
24-hour.....................          2       0.08        5.0        5.0
------------------------------------------------------------------------

    As stated earlier, we had proposed this approach for setting 
PM10 SILs in our 1996 NSR Reform proposal. Many commenters 
supported this approach and believed that the proposed SIL values would 
serve as appropriate de minimis values. In fact, EPA is aware that many 
States have been using these proposed SILs for PM10 as 
screening tools since 1996.
    Regarding the proposal to set the level of Class I SILs at 4 
percent of the Class I increments, we believe that where a proposed 
source contributes less than 4 percent to the Class I increment, 
concentrations are sufficiently low so as not to warrant a detailed 
analysis of the combined effects of the proposed source and all other 
increment-consuming emissions. We previously used a similar rationale 
to establish the significant emissions rates for PSD applicability 
purposes, concluding in part that emissions rates that resulted in 
ambient impacts less than 4 percent of the 24-hour standards for PM and 
SO2 were sufficiently small so as to be considered de 
minimis.
    The original SIL values of 1.0 and 5.0 [mu]g/m \3\ for TSP and PM10 
were interpreted by EPA as representing the minimum amount of ambient 
impact that is significant. This forms the basis of the proposed 
PM2.5 SIL values of 1.0 and 5.0 [mu]g/m \3\ for the annual 
and 24-hour standard for Class II and III areas.
2. Option 2. PM2.5 to PM10 Emissions Ratio
    In our second proposed option for SILs, we would multiply the 
PM10 SILs (proposed in 1996) by the emissions ratio of 
PM2.5 to PM10 for point sources in the 2001 
extrapolation of the final 1999 NEI. This is very similar to option 2A 
for developing increments, and would use the same PM2.5/
PM10 emissions ratio (0.8). The Class I PM10 SILs 
that we proposed in 1996 were 0.2 [mu]g/m3 (annual) and 0.3 
[mu]g/m \3\ (24-hour). For Class II and III PM10 SILs, we 
proposed 1.0 [mu]g/m \3\ (annual) and 5.0 [mu]g/m \3\ (24-hour) levels. 
The SIL values determined in this option are as follows:

------------------------------------------------------------------------
                                                SILs ([mu]g/m\3\)
            Averaging period            --------------------------------
                                          Class I    Class II  Class III
------------------------------------------------------------------------
Annual.................................       0.16        0.8        0.8
24-hour................................       0.24        4.0        4.0
------------------------------------------------------------------------

    The SILs derived under this option are slightly more stringent for 
Class II & III areas than those in option 1. Since PM2.5 
emissions are a subset of PM10 emissions, we believe that an 
emissions ratio of the PM10 SILs would serve as an 
appropriate de minimis SIL value and represent insignificant impact on 
ambient air quality.
3. Option 3. PM2.5 to PM10 NAAQS Ratio
    Under the third option that we are proposing, we would multiply the 
PM10 SILs by the ratio of the PM2.5 NAAQS to the 
PM10 NAAQS. This is very similar to option 2B for developing 
PM2.5 increments, and would use the same factors. We would 
start with the same values for the PM10 SILs that we used 
for option 2 above for SILs. The PM2.5 SILs determined using 
this approach are as follows:

------------------------------------------------------------------------
                                                SILs ([mu]g/m\3\)
            Averaging period            --------------------------------
                                          Class I    Class II  Class III
------------------------------------------------------------------------
Annual.................................       0.06        0.3        0.3
24-hour................................       0.07        1.2        1.2
------------------------------------------------------------------------

    The SILs derived under this option are very stringent for Class II 
and III areas compared to options 1 and 2. Nevertheless, we believe 
that the NAAQS ratio approach is an appropriate alternative to 
determine SILs, since it reflects the stringency in the NAAQS for 
PM2.5 relative to that of PM10. We believe that 
these SIL values would serve as appropriate de minimis values.

VII. Significant Monitoring Concentrations (SMCS)

A. Background on SMCs

1. Preconstruction Monitoring and Its Role in NSR Program
    Under the Act and EPA regulations, an applicant for a PSD permit is 
required to gather preconstruction monitoring data in certain 
circumstances. Section 165(a)(7) calls for ``such monitoring as may be 
necessary to determine the effect which emissions from any such 
facility may have, or is having, on air quality in any areas which may 
be affected by emissions from such source.'' 42 U.S.C. 7475(a)(7). In 
addition, section 165(e) requires an analysis of the air quality in 
areas affected by a proposed major facility or major modification and 
calls for gathering 1 year of monitoring data unless the reviewing 
authority determines that a complete and adequate analysis may be 
accomplished in a shorter period. 42 U.S.C. 7575(e)(3). These 
requirements are codified in

[[Page 54141]]

EPA's PSD regulations at 40 CFR 51.166(m) and 40 CFR 52.21(m).
    In accordance with EPA's Guideline for Air Quality Modeling (40 CFR 
part 51, Appendix W), the preconstruction monitoring data is primarily 
used to determine background concentrations in modeling conducted to 
demonstrate that the proposed source or modification will not cause or 
contribute to a violation of the NAAQS. 40 CFR part 51, Appendix W, 
section 9.2. For most areas where multiple sources of air pollution are 
present, EPA's Guideline recommends using monitoring data to identify 
the portion of background concentrations attributable to natural 
background, minor sources, and distant major sources. 40 CFR part 51, 
Appendix W, section 9.2.3.f. For nearby major sources, EPA recommends 
explicitly modeling the emissions of such sources rather than relying 
on monitored data as part of the NAAQS compliance demonstrations. As 
described earlier, the compliance demonstration with respect to the PSD 
increment compliance focuses on modeling the change in emissions from 
sources in the Significant Impact Area.
2. History of SMC Rules Adopted by EPA
    In 1980, EPA adopted regulations that exempt sources from 
preconstruction monitoring requirements for a pollutant if the source 
can demonstrate that its ambient air impact is less than a value known 
as the Significant Monitoring Concentration or SMC. The pollutant-
specific SMCs are codified at 40 CFR 51.166(i)(5)(i) and 40 CFR 
52.21(i)(5)(i). The EPA developed SMCs as a screening tool for sources 
to determine whether they should conduct site-specific preconstruction 
ambient monitoring. At the time they were adopted, EPA described the 
SMCs as ``air quality concentration de minimis level[s] for each 
pollutant * * * for the purpose of providing a possible exemption from 
monitoring requirements.'' 45 FR 52676, 52707 (Aug. 7, 1980). The EPA 
explained that it believed there was ``little to be gained from 
preconstruction monitoring'' where a source could show that its 
projected impact on the affected area was below these de minimis 
levels. 45 FR 52710.
    In 1980, EPA determined the SMCs based on the current capability of 
providing a meaningful measure of the pollutants. The EPA promulgated 
values that represented five times the lowest detectable concentration 
in ambient air that could be measured by the instruments available for 
monitoring the pollutants. 45 FR 52710. The EPA chose the factor of 
five after reviewing test data for various methods and considering 
instrument sensitivity, potential for sampling error, instrument 
variability, and the capability to read recorded data. Id.
    For PM, EPA set the SMCs for TSP at five times the lowest 
detectable ambient concentration for TSP (2.0 [mu]g/m \3\) using the 
Reference Method 5 for ambient sampling at that time. Memorandum from 
Rehme, K. A., EPA/EMSL/QAD/MSB, to Peters, W., EPA/OAQPS/CPDD, on PSD 
Monitoring (May 20, 1980). We set a SMC only for the 24-hour averaging 
period, at a level of 10 [mu]g/m \3\. We retained the same numerical 
level when we replaced the TSP NAAQS and increments with the 
PM10 NAAQS and increments.

B. Legal Basis for SMCs

    As with the SMCs adopted by EPA in 1980, the SMCs for 
PM2.5 proposed in this action are supported by the de 
minimis doctrine set forth in the Alabama Power v. Costle opinion. Like 
the other pollutants for which EPA has promulgated SMCs, EPA believes 
there is little to be gained from preconstruction monitoring of 
PM2.5 concentrations when the increased emissions of 
PM2.5 from a proposed source or modification has a de 
minimis impact on ambient concentrations of PM2.5. If a 
source can show through modeling of its emissions alone that its 
impacts are less than the corresponding SMC, there is little to be 
gained by requiring that source to collect additional monitoring data 
on PM2.5 emissions to establish background concentrations 
for further analysis.
    Therefore, in developing SMCs for this proposal, EPA sought to use 
methods that would identify levels representing a de minimis or 
insignificant impact on PM2.5 ambient air quality that makes 
the collection of additional monitoring data extraneous. In choosing 
among the options set forth later, EPA proposes to select an option 
that reflects the degree of ambient impact on PM2.5 
concentrations that can be considered truly de minimis and would not 
justify the gathering of monitoring data to establish background 
concentrations for a demonstration of compliance with the NAAQS.

C. Proposed Options for PM2.5 SMC

1. Option 1. Lowest Detectable Concentration
    For this approach, we would use the same methodology originally 
used in 1980 to set the SMC for TSP, i.e., determining the lowest 
detectable concentration and multiplying this value by five. The lowest 
detectable 24-hour average concentration for PM2.5 is 2.0 
[mu]g/m \3\ (40 CFR 50 App L, section 3). Thus, applying this 
methodology for PM2.5 yields an SMC of 10 [mu]g/m \3\ for 
the 24-hour averaging period.
    As we indicated in 1980 when we originally used this methodology to 
set the SMCs for TSP and the other PSD pollutants, the use of five 
times the lowest detectable concentration was chosen to realistically 
reflect pollutant levels at which low level concentrations or small 
incremental changes in pollutant concentrations can reasonably be 
determined. The factor of five takes into account the measurement 
errors associated with the monitoring of these low pollutant levels or 
small incremental changes in concentration. These measurement errors 
arise from various sources, such as sample collection, analytical 
measurement, calibration, and interferences (See Memorandum from Rehme, 
K. A. mentioned earlier). We believe this is a reasonable approach, 
since it has also been used for PM2.5 and TSP. We seek 
comment on this approach.
2. Option 2. PM2.5 to PM2.5 Emissions Ratio
    Proposed option 2 establishes the SMC for PM2.5 by 
multiplying the existing PM10 SMC (10 [mu]g/m \3\) by the 
ratio of PM2.5 emissions to PM10 emissions in the 
2001 extrapolation of the final 1999 NEI. This is the same methodology 
used in Increments option 2A and SIL option 2, and uses the same 
emissions ratio (0.8). This yields a SMC value of 8.0 [mu]g/m \3\ for 
PM2.5 for the 24-hour averaging period.
    This approach gives a PM2.5 SMC value that is 
equivalent, in terms of emissions, to the existing PM10 SMC. 
We believe that this approach is consistent with the approach that 
Congress set out for increments in section 166(f) of the Act and is, as 
such, a reasonable approach for developing PM2.5 SMCs. We 
seek comment on this approach.
3. Option 3. PM2.5 to PM10 NAAQS Ratio
    Under the third option, we propose to multiply the PM10 
SMC by the ratio of the PM2.5 NAAQS to the PM10 
NAAQS. This is the same approach proposed for Increment option 2B and 
SIL option 3. Because the PM10 SMC is for the 24-hour 
averaging period, we would use the ratio of the 24-hour NAAQS for 
PM2.5 (35 [mu]g/m \3\) and PM10 (150 [mu]g/m 
\3\). The resulting factor is 0.233. Thus, the PM2.5 SMC 
developed using this option would be 2.3 [mu]g/m \3\, for the 24-hour 
averaging period.

[[Page 54142]]

    The SMC developed using this approach is very stringent compared to 
options 1 and 2, since it reflects the stringency of the 24-hour NAAQS 
of PM2.5 relative to PM10. Nevertheless, we 
believe this to be also a reasonable approach and seek comments on it.

D. Correction of Cross References

    In addition to exempting sources that have emissions increases 
below the SMCs, EPA also exempts sources from preconstruction 
monitoring where the source demonstrates that existing ambient 
concentrations of a pollutant in the affected area are currently below 
the SMCs. 40 CFR 51.166(i)(5)(ii); 52.21(i)(5)(ii). This aspect of the 
monitoring exemption was also adopted in the 1980 rulemaking. 45 FR 
52710.
    The EPA also proposes in this rulemaking to correct a cross 
reference contained in these parts of the regulations. Paragraphs (ii) 
and (iii) in 40 CFR 51.166(i)(5) and paragraph (ii) in 40 CFR 
52.21(i)(5) each refer to concentrations listed in paragraphs 
(i)(8)(i). However, there is no paragraph (i)(8)(i) in Sec.  51.166 and 
no concentration values are contained in section (i)(8)(i) of Sec.  
52.21. The cross references in these provisions were intended to 
reference the SMCs in paragraph (i)(5)(i), but EPA failed to make this 
change when the paragraphs were renumbered in a prior rulemaking. We 
propose to correct that oversight in this rule.

VIII. Effective Date of the Final Rule, SIP Submittal/Approval 
Deadlines and PM10 Revocation Deadline

    This section sets forth EPA's proposed effective dates for the 
PM2.5 increments (under different options), SILs and SMC. In 
addition, we are setting forth the proposed deadlines for States to 
submit revisions to their SIPs incorporating these changes to the PSD 
regulations, and for EPA to approve or disapprove the revised plans. 
Finally, this section describes EPA's proposed schedule for revoking 
the PM10 annual increments in conjunction with the 
commencement of the PM2.5 increment system under the part 51 
and part 52 PSD regulations and we request comment on establishing a 
transition period for processing complete permit applications. Please 
see Table 1 in the docket (Docket ID No. EPA-HQ-OAR-2006-0605) for a 
summary of the proposed options and alternatives on which we seek 
comment.

A. Option 1: Increments Promulgated Pursuant to Section 166(a) of the 
Act

1. Effective Date of Final Rule
    As described in section III.E.2.a of this preamble, section 166(b) 
of the Act specifies that new regulations for increments promulgated 
pursuant to section 166(a) of the Act become effective 1 year after the 
date of promulgation. Accordingly, if we promulgate the new PM2.5 
increment under the authority of Section 166(a) following Option 1, we 
propose a year's delay in the effective date.
    Alternatively, EPA seeks comments on whether we could make the new 
increment regulations effective 60 days from promulgation. Considering 
the various timeframes outlined in section 166, it is clear that 
Congress envisioned that increments or other measures would become 
effective within 3 years of the promulgation of a NAAQS. In the current 
circumstance, due to prolonged litigation and other implementation 
concerns, there has been an extended delay of over 10 years since we 
established the PM2.5 NAAQS. Given this extended delay, we 
believe that the overall Congressional intent reflected in section 166 
may best be met by advancing the effective date of the proposed 
regulations.
    States have to submit SIPs by April 5, 2008 to address the NSR 
provisions of the final PM2.5 implementation rule after the 
Federal NSR implementation rule is promulgated later this year. If EPA 
decides to promulgate option 1 for increments and section 166(b) 
timelines, the increments rule would not be implemented in SIP-approved 
States until approximately January 2010 (assuming promulgation of this 
rule in Spring 2008 and allowing 21 months for SIP submittal). Thus 
from April 2008 to January 2010, PSD sources would be subject to a 
PM2.5 applicability program, but would need to continue the 
current PM10 air quality impacts analysis. Under these 
circumstances, we expect that States, affected industry, and 
environmental groups will see value in advancing the effective date of 
the promulgated increments.
    Legislative history indicates that, when section 166(b) was first 
enacted in 1977, Congress established the delayed effective date in 
order to allow time for ``contrary Congressional action.'' H.R. Conf. 
Rep. 95-564, at 151 (1977). The Congressional Review Act (CRA) provides 
Congress with an expedited means of reviewing and potentially 
disapproving final actions issued by Federal agencies. Under the CRA, a 
member of Congress can introduce a joint resolution to disapprove a 
particular rule and have that resolution considered using expedited 
procedures if the resolution is introduced within the designated time 
period (generally 60 days depending on the Congressional calendar). 
Furthermore, an agency rule meeting the CRA definition of ``major'' 
cannot take effect for 60 days. We request comment on whether, given 
these procedures under the CRA, a 60-day delay in the effective date of 
the proposed rule could satisfy the Congressional intent reflected in 
section 166(b).
2. State Program
    In this action, we propose to establish final PM2.5 
increments as minimal program element for all State Programs. 
Accordingly, States must submit revised SIPs for EPA's approval that 
incorporate the final PM2.5 increments, or demonstrate that 
an alternative approach is at least equivalent to this minimum program 
element. Irrespective of whether we establish an effective date of the 
final rule that falls 1 year after or 60 days after we promulgate the 
final rule, we propose to require States to submit revised 
implementation plans to EPA for approval within 21 months of 
promulgation (9 months after the effective date of such regulations) in 
accordance with the time frames specified in section 166(b) of the Act. 
Section 166(b) also specifies that we must approve or disapprove these 
revisions within 25 months of promulgation (4 months from the statutory 
deadline for SIP submittal). We regard these statutory deadlines as 
maximum allowed timeframes for action and do not believe that the Act 
restricts our ability to approve SIP revisions requested by a State at 
any time before these deadlines. We also propose to change the 
regulatory provisions at 40 CFR 166(a)(6) to specifically articulate 
these deadlines for these State SIP submittals.
3. Federal Program
    The EPA must also decide how to apply the procedures set forth in 
section 166(b) of the Act to the new PM2.5 increments under 
our 40 CFR part 52 PSD regulations, which apply for States without 
approved PSD programs as well as for Indian lands. We propose to begin 
to implement the Part 52 PSD program upon the effective date of the 
final rule. Accordingly, if we delay the effective date for 1 year 
after the date of promulgation in accordance with Section 166(b), then 
the Part 52 PSD program would become effective and implemented in the 
applicable areas, on this date. Alternatively, if we establish an 
effective date 60 days after we promulgate the final rules, the Part 52 
PSD program would become effective on this same date.
    Alternatively, we request comment on whether we should delay 
implementation of the Federal Part 52

[[Page 54143]]

PSD program until 25 months after promulgation, or the outside date by 
which EPA is required to approve State SIP revisions. This is the same 
approach we took in 1988 to implement the then new NO2 
increments. 53 FR at 40658. We are not offering this as our proposed 
approach because of the significant delay that has already occurred 
between the time we promulgated the PM2.5 NAAQS and the time 
we will finalize this rule. However, we recognize that it may not be 
equitable to begin implementation of the new program requirements in 
those few areas where the Federal program applies before the majority 
of States are required to implement the program. Nonetheless, we seek 
comment on applying this alternative approach for the Federal Part 52 
PSD program and specifically on the consequences of potential 
inequities.

B. Option 2: Increments Promulgated Pursuant to Section 166(f) of the 
Act

1. Effective Date of Final Rule
    In contrast to the proposed delay of the effective date of the new 
PM2.5 increments under option 1, we propose to make the new 
PM2.5 increments proposed under option 2 effective 60 days 
from the date of promulgation, consistent with the CRA timeframe. We do 
not interpret section 166(b) of the Act to apply to increments 
promulgated under the authority of section 166(f) because the first 
sentence in section 166(b) describes only ``[r]egulations referred to 
in subsection (a).''
2. State Program
    We previously stated that we believe that it is appropriate to 
establish a deadline for States to submit required SIP revisions 
analogous to the deadline that applies to States when we promulgate or 
revise a NAAQS. 67 FR 80241. We previously codified, conforming 
regulatory text at 40 CFR 166(a)(6). Under Option 2 of this proposal, 
we propose to follow the existing regulatory provisions that require a 
State to adopt and submit for EPA approval its PM2.5 plan 
revisions no later than 3 years after the date on which we promulgate 
(i.e., publish in the Federal Register) the new regulations in the 40 
CFR part 51 PSD regulations. Alternatively, we request comment on 
whether we should require a timeframe shorter than 36 months, such as 
the statutory maximum of 21 months required under Option 1. Given the 
limited nature of the required changes, we believe that States 
generally may not need more than 21 months to adopt and submit revised 
plans to EPA for approval. If we select this alternative approach, we 
propose to make conforming regulatory changes to 40 CFR 166(a)(6).
3. Federal Program
    For the Federal part 52 PSD regulations, we propose under Option 2 
to make the new PM2.5 increments effective 60 days from the 
date we promulgate the final rules. However, unlike the proposed 3-year 
period being proposed for States to submit their plan revisions to EPA 
for review and approval, we propose to implement the new increments 
under the part 52 PSD regulations upon the effective date of the final 
rules. Since it would be difficult to know when States are planning to 
revise their own PSD programs consistent with the new increment 
regulations, it is not possible to ensure a consistent implementation 
date between approved State programs and programs being implemented 
under the part 52 PSD regulations unless we delayed implementation for 
a full 4 years (3 years for SIP submission and 1 year for EPA to 
approve the revision). We believe that this delay is excessive and does 
not accomplish the goal of expedient implementation of a PM2.5 
PSD program. We request comment on this approach.

C. Revocation of the PM10 Increment

    While we believe it is appropriate to revoke the annual PM10 
increment as explained earlier in this preamble, we propose to retain 
the PM10 increments in both 40 CFR part 51 and part 52 PSD 
regulations until the new PM2.5 increments are being 
implemented either by a State through an approved SIP, or by EPA 
through the Federal Part 52 PSD program. Accordingly, we propose to 
approve the removal of the annual PM10 increments from any 
SIP on or after the date we approve the new PM2.5 increments 
in the same plan. We believe that States should request the removal of 
the annual PM10 increments from their PSD programs at the 
same time they submit plan revisions containing the new PM2.5 
increments, allowing EPA to act on both actions simultaneously.
    Similarly, we propose to retain the annual PM10 
increments in the Part 52 PSD regulations until the effective date of 
the new PM2.5 increments.

D. Transition Period

    We believe that it is appropriate to establish a transition period 
to clarify when PSD permit applications must contain an increment 
analysis for the new PM2.5 increments following the date 
they become effective and are approved as part of any State or Federal 
PSD program. In the past, we have allowed for permit applications 
submitted before the implementation date of new increment regulations 
to continue to be processed under the existing rules, so long as the 
reviewing authority has determined that the application is complete 
before the implementation date. See e.g., existing 40 CFR 
51.166(a)(i)(8) and (9). Consequently, we are also proposing a new 
provision in both the 40 CFR parts 51 and 52 PSD regulations to provide 
a transition process for initiating the requirement for analysis of the 
new PM2.5 increments. Under the Part 51 regulations, we are 
proposing that during the transition period, States have discretion to 
continue the existing PM10 increment program or begin 
implementing the new PM2.5 increment program. For the 
federally administered programs under the Part 52 PSD regulations, the 
provision would apply to each new PSD permit applicant upon the 
effective date of the rule. However, we are also proposing a similar 
transition period in these programs. See proposed 40 CFR 51.166(i)(10) 
and 40 CFR 52.21(i)(11), respectively.

E. Effective Date for SILs and SMCs

    Unlike the approach we propose for PM2.5 increments, we 
are not proposing to make SILs and SMCs a minimum element of an 
approved SIP. Accordingly, we are not proposing to establish specific 
deadlines for submission of revisions to incorporate the final rules 
into SIPs. We do not believe that SILs or SMCs are required elements of 
an approvable State program because in the absence of these 
requirements, States can satisfy the statutory requirements by 
obtaining pre-construction monitoring data and conducting a cumulative 
air quality analysis for every PSD permit application.
    Nonetheless, we believe that availability of SILs and SMCs greatly 
improve program implementation by streamlining the permit process and 
reducing the labor hours necessary to submit and review a complete 
permit application where the projected impact of the proposed source is 
de minimis in the relevant area. For these reasons, we request comment 
on whether we have authority to establish these as minimum program 
elements based on the improved efficiency of the permit process. If we 
require States to incorporate SILs and SMCs as mandatory elements of an 
approvable program, then we would apply the existing regulations at 40 
CFR 166(a)(6) for establishing the SIP submittal deadline. Under either 
approach, the

[[Page 54144]]

final rules would become effective 60 days after we promulgate the 
final rules.

IX. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
action is a significant regulatory action because it raises novel legal 
or policy issues arising out of legal mandates, the President's 
priorities, or the principle set forth in the EO. Accordingly, EPA 
submitted this action to the Office of Management and Budget (OMB) for 
review under EO 12866 and any changes made in response to OMB 
recommendations have been documented in the docket for this action.

B. Paperwork Reduction Act

    The information collection requirements in this rule have been 
submitted for approval to the OMB under the Paperwork Reduction Act, 44 
U.S.C. 3501 et seq. The information collection requirements are not 
enforceable until OMB approves them. The Information Collection Request 
(ICR) document prepared by EPA has been assigned EPA ICR number 
2276.01.
    Certain records and reports are necessary for the State or local 
agency (or the EPA Administrator in non-delegated States), for example, 
to: (1) Confirm the compliance of status of stationary sources, 
identify any stationary sources not subject to the standards, and 
identify stationary sources subject to the rules; and (2) ensure that 
the stationary source control requirements are being achieved. The 
information would be used by EPA or State enforcement personnel to (1) 
Identify stationary sources subject to the rules, (2) ensure that 
appropriate control technology is being properly applied, and (3) 
ensure that the emission control devices are being properly operated 
and maintained on a continuous basis.
    The proposed rule would increase the PSD permitting burden for 
owners and operators of major stationary sources of PM2.5 
emissions by adding PM2.5 to the list of regulated NSR 
pollutants for which air quality impact analyses must be carried out to 
track increment consumption and demonstrate compliance with the NAAQS. 
At the same time, there would be a reduction in burden directly 
associated with the revocation of the annual increment for 
PM10, as proposed in this proposed rule. Over the 3-year 
period covered by the ICR, we estimate an average annual burden 
totaling about 14,000 hours and $920,000 for all industry entities that 
would be affected by the proposed rule. For the same reasons, we also 
expect the proposed rule (when fully implemented) to increase burden 
for the State and local authorities reviewing PSD permit applications. 
In addition, there would be additional burden for State and local 
agencies to revise their SIPs to incorporate the proposed changes. Over 
the 3-year period covered by the ICR, we estimate that the average 
annual burden for all State and local reviewing authorities will total 
about 4,150 hours and $180,000.
    Burden means the total time, effort, or financial resources 
expended by persons to generate, maintain, retain, or disclose or 
provide information to or for a Federal agency. This includes the time 
needed to review instructions; develop, acquire, install, and utilize 
technology and systems for the purposes of collecting, validating, and 
verifying information, processing and maintaining information, and 
disclosing and providing information; adjust the existing ways to 
comply with any previously applicable instructions and requirements; 
train personnel to be able to respond to a collection of information; 
search data sources; complete and review the collection of information; 
and transmit or otherwise disclose the information.
    Any agency may not conduct or sponsor, and a person is not required 
to respond to a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations in 40 CFR are listed in 40 CFR part 9.
    To comment on the Agency's need for this information, the accuracy 
of the provided burden estimates, and any suggested methods for 
minimizing respondent burden, including the use of automated collection 
techniques, EPA has established a public docket for this ICR under 
Docket ID number EPA-HQ-OAR-2007-0628. Submit any comments related to 
the ICR for this proposed rule to EPA and OMB. See `Addresses' section 
at the beginning of this notice for where to submit comments to EPA. 
Send comments to OMB at the Office of Information and Regulatory 
Affairs, Office of Management and Budget, 725 17th Street, NW., 
Washington, DC 20503, Attention: Desk Office for EPA. Since OMB is 
required to make a decision concerning the ICR between 30 and 60 days 
after September 21, 2007, a comment to OMB is best assured of having 
its full effect if OMB receives it by October 22, 2007. The final rule 
will respond to any OMB or public comments on the information 
collection requirements contained in this proposal.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to prepare a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements under the Administrative 
Procedure Act or any other statute unless the agency certifies that the 
rule will not have a significant economic impact on a substantial 
number of small entities. Small entities include small businesses, 
small organizations, and small governmental jurisdictions.
    For purposes of assessing the impacts of this proposed rule on 
small entities, ``small entity'' is defined as: (1) A small business as 
defined by the Small Business Administration's regulations at 13 CFR 
121.201; (2) a small governmental jurisdiction that is a government or 
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 this proposed rule on 
small entities, I certify that this rule will not have a significant 
economic impact on a substantial number of small entities. This 
proposed rule will not impose any requirements on small entities. We 
continue to be interested in the potential impacts of the proposed rule 
on small entities and welcome comments on issues related to such 
impacts.

D. Unfunded Mandates Reform Act

    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 actions on State, local, and tribal 
governments and the private sector. Under section 202 of the 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 
aggregate, or to the private sector, of $100 million or more in any 1 
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

[[Page 54145]]

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 Federal 
intergovernmental mandates, and informing, educating, and advising 
small governments on compliance with the regulatory requirements.
    We have determined that this proposed rule does not contain a 
Federal mandate that may result in expenditures of $100 million or more 
for State, local, and tribal governments, in the aggregate, or the 
private sector in any one year. The proposed rule adds only a 
relatively small number of new requirements to the existing permit 
requirements already in place under the PSD program, since States are 
currently implementing a PM10 surrogate program pursuant to 
EPA guidance. Thus, this proposed rulemaking is not subject to the 
requirements of sections 202 and 205 of the UMRA. We have also 
determined that this rule contains no regulatory requirements that 
might significantly or uniquely affect small governments because this 
rule applies only to new major stationary sources. Thus, this proposed 
rulemaking is not subject to the requirements of section 203 of the 
URMA.

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'' is 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 proposed rule does not have federalism implications. It would 
not have substantial direct effects on the States, on the relationship 
between the national government and the States, or on the distribution 
of power and responsibilities among the various levels of government, 
as specified in Executive Order 13132. Pursuant to the terms of 
Executive Order 13132, it has been determined that this proposed rule 
does not have ``federalism implications'' because it does not meet the 
necessary criteria. Thus, the requirements of section 6 of the 
Executive Order do not apply to this proposed rule.
    In the spirit of Executive Order 13132, and consistent with our 
policy to promote communications between us and State and local 
governments, we specifically solicit comment on this proposed rule from 
State and local officials.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    Executive Order 13175, entitled ``Consultation and Coordination 
with Indian Tribal Government'' (65 FR 67249, November 6, 2000), 
requires us to develop an accountable process to ensure ``meaningful 
and timely input by tribal officials in the development of regulatory 
policies that have tribal implications.''
    This proposed rule does not have tribal implications as defined in 
Executive Order 13175. This rule provides the elements to implement a 
PM2.5 PSD program in attainment areas. The CAA provides for 
States to develop plans to regulate emissions of air pollutants within 
their jurisdictions. The Tribal Air Rule (TAR) under the CAA gives 
tribes the opportunity to develop and implement CAA programs such as 
programs to attain and maintain the PM2.5 NAAQS, but it 
leaves to the discretion of the Tribe the decision of whether to 
develop these programs and which programs, or appropriate elements of a 
program, they will adopt.
    Although Executive Order 13175 does not apply to this rule, EPA did 
reach out to national tribal organizations in 2006 to provide a forum 
for tribal professionals to provide input to the rulemaking. However, 
not much participation or input was received. It will neither impose 
substantial direct compliance costs on tribal governments, nor preempt 
tribal law. The EPA specifically solicits additional comment on this 
proposed rule from tribal officials.

G. Executive Order 13045: Protection of Children From Environmental 
Health & 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 we have reason to believe may 
have a disproportionate effect on children. If the regulatory action 
meets both criteria, the Agency 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 
reasonably feasible alternatives considered by the Agency.
    This proposed rule is not subject to the EO because it is not 
economically significant as defined in EO 12866, and because the Agency 
does not have a reason to believe the environmental health or safety 
risks addressed by this action present a disproportionate risk to 
children because one of the basic requirements of the PSD program is 
that new and modified major stationary sources must demonstrate that 
any new emissions do not cause or contribute to air quality in 
violation of the national ambient air quality standards. The public is 
invited to submit or identify peer-reviewed studies and data, of which 
EPA may not be aware, that assessed resolutions of early life exposure 
to ambient concentrations of fine particulate measured as 
PM2.5.

H. Executive Order 13211: Actions 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. Further, we have 
concluded that this rule is not likely to have any adverse energy 
effects.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law No. 104-113, 12(d) (15 U.S.C. 272 note) 
directs us to use voluntary consensus standards (VCS) in our regulatory 
and procurement activities unless to do so would be inconsistent with 
applicable law or otherwise impractical. The VCS are technical 
standards (e.g., materials specifications, test methods, sampling 
procedures, and business practices) developed or adopted by one or more 
voluntary consensus bodies. The NTTAA directs us to provide Congress, 
through annual reports to OMB, with explanations when we do not use

[[Page 54146]]

available and applicable VCS. This proposed rule does not involve 
technical standards. Therefore, we are not considering the use of any 
VCS.

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898 (59 FR 7629 (February 16, 1994)) establishes 
Federal executive policy on environmental justice. Its main provision 
directs Federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States.
    The EPA has determined that this proposed rule will not have 
disproportionately high and adverse human health environmental effects 
on minority or low-income populations because it does not affect the 
level of protection provided to human health or the environment. This 
regulation would provide regulatory certainty for implementing the 
preconstruction NSR permitting program for PM2.5. However, 
the requirements would be similar to the existing requirements of the 
PM10 program and hence does not impact the human health 
environmental effects.

X. Statutory Authority

    The statutory authority for this proposed action is provided by 
sections 101, 160, 163, 165, 166, 301, and 307(d) of the Act as amended 
(42 U.S.C. 7401, 7470, 7473, 7475, 7476, 7601, and 7607(d)).

List of Subjects

40 CFR Part 51

    Administrative practices and procedures, Air pollution control, 
Environmental protection, Intergovernmental relations.

40 CFR Part 52

    Administrative practices and procedures, Air pollution control, 
Environmental protection, Intergovernmental relations.

    Dated: September 12, 2007.
Stephen L. Johnson,
Administrator.

    For the reasons set out in the preamble, title 40, chapter I of the 
Code of Federal Regulations is proposed to be amended as follows:

PART 51--[AMENDED]

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

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

Subpart I--[Amended]

    2. Section 51.165 is amended by revising the table in paragraph 
(b)(2) to read as follows:


Sec.  51.165  Permit requirements.

* * * * *
    (b) * * *
    (2) * * *
    Option 1 for the table in paragraph (b)(2):

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Averaging time  (hours)
             Pollutant                       Annual         --------------------------------------------------------------------------------------------
                                                                       24                      8                      3                      1
--------------------------------------------------------------------------------------------------------------------------------------------------------
SO2................................  1.0 [mu]g/m\3\........  5 [mu]g/m\3\..........  .....................  25 [mu]g/m\3\.
PM10...............................  ......................  ......................  .....................  .....................  5 [mu]g/m\3\.
PM2.5..............................  1.0 [mu]g/m\3\........  5 [mu]g/m\3\.
NO2................................  1.0 [mu]g/m\3\.
CO.................................  ......................  ......................  0.5 mg/m\3\..........  .....................  2 mg/m\3\.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Option 2 for the table in paragraph (b)(2):

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Averaging time  (hours)
             Pollutant                       Annual         --------------------------------------------------------------------------------------------
                                                                       24                      8                      3                      1
--------------------------------------------------------------------------------------------------------------------------------------------------------
SO2................................  1.0 [mu]g/m\3\........  5 [mu]g/m\3\..........  .....................  25 [mu]g/m\3\.
PM10...............................  ......................  5 [mu]g/m\3\.
PM2.5..............................  0.8 [mu]g/m\3\........  4 [mu]g/m\3\.
NO2................................  1.0 [mu]g/m\3\.
CO.................................  ......................  ......................  0.5 mg/m\3\..........  .....................  2 mg/m\3\.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Option 3 for the table in paragraph (b)(2):

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Averaging time  (hours)
             Pollutant                       Annual         --------------------------------------------------------------------------------------------
                                                                       24                      8                      3                      1
--------------------------------------------------------------------------------------------------------------------------------------------------------
SO2................................  1.0 [mu]g/m\3\........  5 [mu]g/m\3\..........  .....................  25 [mu]g/m\3\.
PM10...............................  ......................  5 [mu]g/m\3\.
PM2.5..............................  0.3 [mu]g/m\3\........  1.2 [mu]g/m\3\.
NO2................................  1.0 [mu]g/m\3\.
CO.................................  ......................  ......................  0.5 mg/m\3\..........  .....................  2 mg/m\3\.
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 54147]]

* * * * *
    3. Section 51.166 is amended as follows:
    a. By revising the table in paragraph (c);
    b. By revising paragraph (i)(5)(i)(c);
    c. By revising paragraphs (i)(5)(ii) and (iii);
    d. By revising paragraphs (i)(8) and (9);
    e. By adding paragraph (i)(10);
    f. By revising paragraph (k); and
    g. By revising the table in paragraph (p)(4).


Sec.  51.166  Prevention of significant deterioration of air quality.

* * * * *
    (c) * * *
    Option 1 for the table in paragraph (c):

------------------------------------------------------------------------
                                                             Maximum
                                                            allowable
                       Pollutant                             increase
                                                         (micrograms per
                                                           cubic meter)
------------------------------------------------------------------------
                                 Class I
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              1
    24-hr maximum......................................              3
PM10:
    24-hr maximum......................................              8
Sulfur dioxide:
    Annual arithmetic mean.............................              2
    24-hr maximum......................................              5
    3-hr maximum.......................................             25
Nitrogen dioxide:
    Annual arithmetic mean.............................              2.5
------------------------------------------------------------------------
                                Class II
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              4
    24-hr maximum......................................              9
PM10:
    24-hr maximum......................................             30
Sulfur dioxide:
    Annual arithmetic mean.............................             20
    24-hr maximum......................................             91
    3-hr maximum.......................................            512
Nitrogen dioxide:
    Annual arithmetic mean.............................             25
------------------------------------------------------------------------
                                Class III
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              8
    24-hr maximum......................................             18
PM10:
    PM10, 24-hr maximum................................             60
Sulfur dioxide:
    Annual arithmetic mean.............................             40
    24-hr maximum......................................            182
    3-hr maximum.......................................            700
Nitrogen dioxide:
    Annual arithmetic mean.............................             50
------------------------------------------------------------------------

    Option 2A for the table in paragraph (c):

------------------------------------------------------------------------
                                                             Maximum
                                                            allowable
                       Pollutant                             increase
                                                         (micrograms per
                                                           cubic meter)
------------------------------------------------------------------------
                                 Class I
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              1
    24-hr maximum......................................              2
PM10:
    24-hr maximum......................................              8
Sulfur dioxide:

[[Page 54148]]


    Annual arithmetic mean.............................              2
    24-hr maximum......................................              5
    3-hr maximum.......................................             25
Nitrogen dioxide:
    Annual arithmetic mean.............................              2.5
------------------------------------------------------------------------
                                Class II
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              4
    24-hr maximum......................................              9
PM10:
    24-hr maximum......................................             30
Sulfur dioxide:
    Annual arithmetic mean.............................             20
    24-hr maximum......................................             91
    3-hr maximum.......................................            512
Nitrogen dioxide:
    Annual arithmetic mean.............................             25
------------------------------------------------------------------------
                                Class III
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              8
    24-hr maximum......................................             18
PM10:
    24-hr maximum......................................             60
Sulfur dioxide:
    Annual arithmetic mean.............................             40
    24-hr maximum......................................            182
    3-hr maximum.......................................            700
Nitrogen dioxide:
    Annual arithmetic mean.............................             50
------------------------------------------------------------------------

    Option 2B for the table in paragraph (c):

------------------------------------------------------------------------
                                                             Maximum
                                                            allowable
                       Pollutant                             increase
                                                         (micrograms per
                                                           cubic meter)
------------------------------------------------------------------------
                                 Class I
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................               1
    24-hr maximum......................................               2
PM10:
    24-hr maximum......................................               8
Sulfur dioxide:
    Annual arithmetic mean.............................               2
    24-hr maximum......................................               5
    3-hr maximum.......................................              25
Nitrogen dioxide:
    Annual arithmetic mean.............................             2.5
------------------------------------------------------------------------
                                Class II
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................               5
    24-hr maximum......................................               9
PM10:
    24-hr maximum......................................              30
Sulfur dioxide:
    Annual arithmetic mean.............................              20
    24-hr maximum......................................              91
    3-hr maximum.......................................             512

[[Page 54149]]


Nitrogen dioxide:
    Annual arithmetic mean.............................              25
------------------------------------------------------------------------
                                Class III
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              10
    24-hr maximum......................................              18
PM10:
    24-hr maximum......................................              60
Sulfur dioxide:
    Annual arithmetic mean.............................              40
    24-hr maximum......................................             182
    3-hr maximum.......................................             700
Nitrogen dioxide:
    Annual arithmetic mean.............................              50
------------------------------------------------------------------------

* * * * *
    (i) * * *
    (5) * * *
    (i) * * *
    (c) Particulate matter:
    (1) 10 [mu]g/m\3\ of PM10, 24-hour average;
    Option 1 for paragraph (i)(5)(i)(c)(2):
    (2) 10 [mu]g/m\3\ of PM2.5, 24-hour average;
    Option 2 for paragraph (i)(5)(i)(c):
    (2) 8.0 [mu]g/m\3\ of PM2.5, 24-hour average;
    Option 3 for paragraph (i)(5)(i)(c):
    (2) 2.3 [mu]g/m\3\ of PM2.5, 24-hour average;
* * * * *
    (ii) The concentrations of the pollutant in the area that the 
source or modification would affect are less than the concentrations 
listed in paragraph (i)(5)(i) of this section; or
    (iii) The pollutant is not listed in paragraph (i)(5)(i) of this 
section.
* * * * *
    (8) The plan may provide that the permitting requirements 
equivalent to those contained in paragraph (k)(1)(b) of this section do 
not apply to a stationary source or modification with respect to any 
maximum allowable increase for nitrogen oxides if the owner or operator 
of the source or modification submitted an application for a permit 
under the applicable permit program approved or promulgated under the 
Act before the provisions embodying the maximum allowable increase took 
effect as part of the plan and the reviewing authority subsequently 
determined that the application as submitted before that date was 
complete.
    (9) The plan may provide that the permitting requirements 
equivalent to those contained in paragraph (k)(1)(b ) of this section 
shall not apply to a stationary source or modification with respect to 
any maximum allowable increase for PM10 if (i) the owner or 
operator of the source or modification submitted an application for a 
permit under the applicable permit program approved under the Act 
before the provisions embodying the maximum allowable increases for 
PM10 took effect as part of the plan, and (ii) the reviewing 
authority subsequently determined that the application as submitted 
before that date was complete. Instead, the applicable requirements 
equivalent to paragraph (k)(1)(b ) shall apply with respect to the 
maximum allowable increases for TSP as in effect on the date the 
application was submitted.
    (10) The plan may provide that the permitting requirements 
equivalent to those contained in paragraph (k)(1)(b ) of this section 
shall not apply to a stationary source or modification with respect to 
any maximum allowable increase for PM2.5 if (i) the owner or 
operator of the source or modification submitted an application for a 
permit under the applicable permit program approved under the Act 
before the provisions embodying the maximum allowable increases for 
PM2.5 took effect as part of the plan, and (ii) the 
reviewing authority subsequently determined that the application as 
submitted before that date was complete. Instead, the applicable 
requirements equivalent to paragraph (k)(1)(b ) shall apply with 
respect to the maximum allowable increases for PM10 as in 
effect on the date the application was submitted.
* * * * *
    (k) Source impact analysis--(1) Required demonstration. The plan 
shall provide that the owner or operator of the proposed source or 
modification shall demonstrate that allowable emission increases from 
the proposed source or modification, in conjunction with all other 
applicable emissions increases or reduction (including secondary 
emissions), would not cause or contribute to air pollution in violation 
of:
    (a) Any national ambient air quality standard in any air quality 
control region; or
    (b ) Any applicable maximum allowable increase over the baseline 
concentration in any area.
    (2) Significant impact levels. The plan shall provide that, for 
purposes of PM2.5, the demonstration required in paragraph 
(k)(1) of this section is deemed to have been made if the emissions 
increase of direct PM2.5 emissions from the new stationary 
source alone or the net emissions increase of direct PM2.5 
emissions from the modification alone would cause, in all areas, air 
quality impacts less than the following amounts:
    Option 1 for the table in paragraph (k)(2):

----------------------------------------------------------------------------------------------------------------
                                         Class I significant      Class II significant    Class III significant
            Averaging time                  impact levels            impact levels            impact levels
----------------------------------------------------------------------------------------------------------------
Annual...............................  0.04 [mu]g/m\3\........  1.0 [mu]g/m\3\.........  1.0 [mu]g/m\3\.
24-hour..............................  0.08 [mu]g/m\3\........  5.0 [mu]g/m\3\.........  5.0 [mu]g/m\3\.
----------------------------------------------------------------------------------------------------------------


[[Page 54150]]

    Option 2 for the table in paragraph (k)(2):

----------------------------------------------------------------------------------------------------------------
                                         Class I significant      Class II significant    Class III significant
            Averaging time                  impact levels            impact levels            impact levels
----------------------------------------------------------------------------------------------------------------
Annual...............................  0.16 [mu]g/m3..........  0.8 [mu]g/m\3\.........  0.8 [mu]g/m\3\.
24-hour..............................  0.24 [mu]g/m\3\........  4.0 [mu]g/m\3\.........  4.0 [mu]g/m\3\.
----------------------------------------------------------------------------------------------------------------

    Option 3 the table in paragraph (k)(2):

----------------------------------------------------------------------------------------------------------------
                                         Class I significant      Class II significant    Class III significant
            Averaging time                  impact levels            impact levels            impact levels
----------------------------------------------------------------------------------------------------------------
Annual...............................  0.06 [mu]g/m\3\........  0.3 [mu]g/m\3\.........  0.3 [mu]g/m\3\.
24-hour..............................  0.07 [mu]g/m\3\........  1.2 [mu]g/m\3\.........  1.2 [mu]g/m\3\.
----------------------------------------------------------------------------------------------------------------

* * * * *
    (p) * * *
    (4) * * *
    Option 1 for the table in paragraph (p)(4):

------------------------------------------------------------------------
                                                              Maximum
                                                             allowable
                                                             increase
                        Pollutant                           (micrograms
                                                             per cubic
                                                              meter)
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean..............................               4
    24-hr maximum.......................................               9
PM10:
    24-hr maximum.......................................              30
Sulfur dioxide:
    Annual arithmetic mean..............................              20
    24-hr maximum.......................................              91
    3-hr maximum........................................             325
Nitrogen dioxide:
    Annual arithmetic mean..............................              25
------------------------------------------------------------------------

    Option 2A for the table in paragraph (p)(4):

------------------------------------------------------------------------
                                                              Maximum
                                                             allowable
                                                             increase
                        Pollutant                           (micrograms
                                                             per cubic
                                                              meter)
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean..............................               4
    24-hr maximum.......................................               9
PM10:
    24-hr maximum.......................................              30
Sulfur dioxide:
    Annual arithmetic mean..............................              20
    24-hr maximum.......................................              91
    3-hr maximum........................................             325
Nitrogen dioxide:
    Annual arithmetic mean..............................              25
------------------------------------------------------------------------

    Option 2B for the table in paragraph (p)(4):

[[Page 54151]]



------------------------------------------------------------------------
                                                              Maximum
                                                             allowable
                                                             increase
                        Pollutant                           (micrograms
                                                             per cubic
                                                              meter)
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean..............................               5
    24-hr maximum.......................................               9
PM10:
    24-hr maximum.......................................              30
Sulfur dioxide:
    Annual arithmetic mean..............................              20
    24-hr maximum.......................................              91
    3-hr maximum........................................             325
Nitrogen dioxide:
    Annual arithmetic mean..............................              25
------------------------------------------------------------------------

* * * * *
    4. Appendix S to part 51 is amended by revising the table in 
Section III.A to read as follows:

Appendix S to Part 51--Emission Offset Interpretative Ruling

* * * * *
    III. * * *
    A. * * *
    Option 1 for the table in Section III.A:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Averaging time (hours)
             Pollutant                       Annual         --------------------------------------------------------------------------------------------
                                                                       24                      8                      3                      1
--------------------------------------------------------------------------------------------------------------------------------------------------------
SO2................................  1.0 [mu]g/m\3\........  5 [mu]g/m\3\..........  .....................  25 [mu]g/m\3\........  .....................
PM10...............................  ......................  5 [mu]g/m\3\..........  .....................  .....................  .....................
PM2.5..............................  1.0 [mu]g/m\3\........  5 [mu]g/m\3\..........  .....................  .....................  .....................
NO2................................  1.0 [mu]g/m\3\........  ......................  .....................  .....................  .....................
CO.................................  ......................  ......................  0.5 mg/m\3\..........  .....................  2 mg/m\3\.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Option 2 for the table in Section III.A:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Averaging time (hours)
             Pollutant                       Annual         --------------------------------------------------------------------------------------------
                                                                       24                      8                      3                      1
--------------------------------------------------------------------------------------------------------------------------------------------------------
SO2................................  1.0 [mu]g/m\3\........  5 [mu]g/m\3\..........  .....................  25 [mu]g/m\3\........  .....................
PM10...............................  ......................  5 [mu]g/m\3\..........  .....................  .....................  .....................
PM2.5..............................  0.8 [mu]g/m\3\........  4 [mu]g/m\3\..........  .....................  .....................  .....................
NO2................................  1.0 [mu]g/m\3\........  ......................  .....................  .....................  .....................
CO.................................  ......................  ......................  0.5 mg/m\3\..........  .....................  2 mg/m\3\.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Option 3 for the table in Section III.A:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Averaging time (hours)
             Pollutant                       Annual         --------------------------------------------------------------------------------------------
                                                                       24                      8                      3                      1
--------------------------------------------------------------------------------------------------------------------------------------------------------
SO2................................  1.0 [mu]g/m\3\........  5 [mu]g/m\3\..........  .....................  25 [mu]g/m\3\........  .....................
PM10...............................  ......................  5 [mu]g/m\3\..........  .....................  .....................  .....................
PM2.5..............................  0.3 [mu]g/m\3\........  1.2 [mu]g/m\3\........  .....................  .....................  .....................
NO2................................  1.0 [mu]g/m\3\........  ......................  .....................  .....................  .....................
CO.................................  ......................  ......................  0.5 mg/m\3\..........  .....................  2 mg/m\3\.
--------------------------------------------------------------------------------------------------------------------------------------------------------

* * * * ** * *

PART 52--[AMENDED]

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

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

Subpart A--[Amended]

    6. Section 52.21 is amended as follows:
    a. By revising the table in paragraph (c);
    b. By revising the third entry in paragraph (i)(5)(i);
    c. By revising paragraphs (i)(5)(ii) and (iii);
    d. By revising paragraphs (i)(9) and (10);
    e. By adding paragraph (i)(11);
    f. By revising paragraph (k); and
    g. By revising the table in paragraph (p)(5).


Sec.  52.21  Prevention of significant deterioration of air quality.

* * * * *
    (c) * * *

[[Page 54152]]

    Option 1 for the table in paragraph (c):

------------------------------------------------------------------------
                                                             Maximum
                                                            allowable
                       Pollutant                             increase
                                                         (micrograms per
                                                           cubic meter)
------------------------------------------------------------------------
                                 Class I
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              1
    24-hr maximum......................................              2
PM10:
    24-hr maximum......................................              8
Sulfur dioxide:
    Annual arithmetic mean.............................              2
    24-hr maximum......................................              5
    3-hr maximum.......................................             25
Nitrogen dioxide:
    Annual arithmetic mean.............................              2.5
------------------------------------------------------------------------
                                Class II
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              4
    24-hr maximum......................................              9
PM10:
    24-hr maximum......................................             30
Sulfur dioxide:
    Annual arithmetic mean.............................             20
    24-hr maximum......................................             91
    3-hr maximum.......................................            512
Nitrogen dioxide:
    Annual arithmetic mean.............................             25
------------------------------------------------------------------------
                                Class III
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              8
    24-hr maximum......................................             18
PM10:
    PM10 24-hr maximum.................................             60
Sulfur dioxide:
    Annual arithmetic mean.............................             40
    24-hr maximum......................................            182
    3-hr maximum.......................................            700
Nitrogen dioxide:
    Annual arithmetic mean.............................             50
------------------------------------------------------------------------

    Option 2A for the table in paragraph (c):

------------------------------------------------------------------------
                                                             Maximum
                                                            allowable
                       Pollutant                             increase
                                                         (micrograms per
                                                           cubic meter)
------------------------------------------------------------------------
                                 Class I
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              1
    24-hr maximum......................................              2
PM10:
    24-hr maximum......................................              8
Sulfur dioxide:
    Annual arithmetic mean.............................              2
    24-hr maximum......................................              5
    3-hr maximum.......................................             25
Nitrogen dioxide:
    Annual arithmetic mean.............................              2.5
------------------------------------------------------------------------

[[Page 54153]]


                                Class II
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              4
    24-hr maximum......................................              9
PM10:
    24-hr maximum......................................             30
Sulfur dioxide:
    Annual arithmetic mean.............................             20
    24-hr maximum......................................             91
    3-hr maximum.......................................            512
Nitrogen dioxide:
    Annual arithmetic mean.............................             25
------------------------------------------------------------------------
                                Class III
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              8
    24-hr maximum......................................             18
PM10:
    24-hr maximum......................................             60
Sulfur dioxide:
    Annual arithmetic mean.............................             40
    24-hr maximum......................................            182
    3-hr maximum.......................................            700
Nitrogen dioxide:
    Annual arithmetic mean.............................             50
------------------------------------------------------------------------

    Option 2B for the table in paragraph (c):

------------------------------------------------------------------------
                                                             Maximum
                                                            allowable
                       Pollutant                             increase
                                                         (micrograms per
                                                           cubic meter)
------------------------------------------------------------------------
                                 Class I
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              1
    24-hr maximum......................................              2
PM10:
    24-hr maximum......................................              8
Sulfur dioxide:
    Annual arithmetic mean.............................              2
    24-hr maximum......................................              5
    3-hr maximum.......................................             25
Nitrogen dioxide:
    Annual arithmetic mean.............................              2.5
------------------------------------------------------------------------
                                Class II
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................              5
    24-hr maximum......................................              9
PM10:
    24-hr maximum......................................             30
Sulfur dioxide:
    Annual arithmetic mean.............................             20
    24-hr maximum......................................             91
    3-hr maximum.......................................            512
Nitrogen dioxide:
    Annual arithmetic mean.............................             25
------------------------------------------------------------------------

[[Page 54154]]


                                Class III
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean.............................             10
    24-hr maximum......................................             18
PM10:
    24-hr maximum......................................             60
Sulfur dioxide:
    Annual arithmetic mean.............................             40
    24-hr maximum......................................            182
    3-hr maximum.......................................            700
Nitrogen dioxide:
    Annual arithmetic mean.............................             50
------------------------------------------------------------------------

* * * * *
    (i) * * *
    (5) * * *
    (i) * * *
    Option 1 for the third entry in paragraph (i)(5)(i):
    Particulate matter:
    (a) 10 [mu]g/m\3\ of PM10, 24-hour average;
    (b) 10 [mu]g/m\3\ of PM2.5, 24-hour average;
    Option 2 for the third entry in paragraph (i)(5):
    Particulate matter:
    (a) 10 [mu]g/m\3\ of PM10, 24-hour average;
    (b) 8.0 [mu]g/m\3\ of PM2.5, 24-hour average;
    Option 3 for the third entry in paragraph (i)(5):
    Particulate matter:
    (a) 10 [mu]g/m\3\ of PM10, 24-hour average;
    (b) 2.3 [mu]g/m\3\ of PM2.5, 24-hour average;
* * * * *
    (ii) The concentrations of the pollutant in the area that the 
source or modification would affect are less than the concentrations 
listed in paragraph (i)(5)(i) of this section; or
    (iii) The pollutant is not listed in paragraph (i)(5)(i) of this 
section.
* * * * *
    (9) The requirements of paragraph (k)(1)(a) of this section shall 
not apply to a stationary source or modification with respect to any 
maximum allowable increase for nitrogen oxides if the owner or operator 
of the source or modification submitted an application for a permit 
under this section before the provisions embodying the maximum 
allowable increase took effect as part of the applicable implementation 
plan and the Administrator subsequently determined that the application 
as submitted before that date was complete.
    (10) The requirements in paragraph (k)(1)(b) of this section shall 
not apply to a stationary source or modification with respect to any 
maximum allowable increase for PM10 if (i) the owner or 
operator of the source or modification submitted an application for a 
permit under this section before the provisions embodying the maximum 
allowable increases for PM10 took effect in an 
implementation plan to which this section applies, and (ii) the 
Administrator subsequently determined that the application as submitted 
before that date was otherwise complete. Instead, the requirements in 
paragraph (k)(1)(b) shall apply with respect to the maximum allowable 
increases for TSP as in effect on the date the application was 
submitted.
    (11) The requirements in paragraph (k)(1)(b) of this section shall 
not apply to a stationary source or modification with respect to any 
maximum allowable increase for PM2.5 if (i) the owner or 
operator of the source or modification submitted an application for a 
permit under this section before the provisions embodying the maximum 
allowable increases for PM2.5 took effect in an 
implementation plan to which this section applies, and (ii) the 
Administrator subsequently determined that the application as submitted 
before that date was otherwise complete. Instead, the requirements in 
paragraph (k)(1)(b) shall apply with respect to the maximum allowable 
increases for PM10 as in effect on the date the application 
was submitted.
* * * * *
    (k) Source impact analysis--(1) Required demonstration. The owner 
or operator of the proposed source or modification shall demonstrate 
that allowable emission increases from the proposed source or 
modification, in conjunction with all other applicable emissions 
increases or reductions (including secondary emissions), would not 
cause or contribute to air pollution in violation of:
    (a) Any national ambient air quality standard in any air quality 
control region; or
    (b) Any applicable maximum allowable increase over the baseline 
concentration in any area.
    (2) Significant impact levels. For purposes of PM2.5, 
the demonstration required in paragraph (k)(1) of this section is 
deemed to have been made if the emissions increase of direct 
PM2.5 emissions from the new stationary source alone or the 
net emissions increase of direct PM2.5 emissions from the 
modification alone would cause, in all areas, air quality impacts less 
than the following amounts:
    Option 1 for the table in paragraph (k)(2):

----------------------------------------------------------------------------------------------------------------
                                         Class I significant      Class II significant    Class III significant
            Averaging time                  impact levels            impact levels            impact levels
----------------------------------------------------------------------------------------------------------------
Annual...............................  0.04 [mu]g/m\3\........  1.0 [mu]g/m\3\.........  1.0 [mu]g/m\3\.
24-hour..............................  0.08 [mu]g/m\3\........  5.0 [mu]g/m\3\.........  5.0 [mu]g/m\3\.
----------------------------------------------------------------------------------------------------------------

    Option 2 for the table in paragraph (k)(2):

[[Page 54155]]



----------------------------------------------------------------------------------------------------------------
                                         Class I significant      Class II significant    Class III significant
            Averaging time                  impact levels            impact levels            impact levels
----------------------------------------------------------------------------------------------------------------
Annual...............................  0.16 [mu]g/m\3\........  0.8 [mu]g/m\3\.........  0.8 [mu]g/m\3\.
24-hour..............................  0.24 [mu]g/m\3\........  4.0 [mu]g/m\3\.........  4.0 [mu]g/m\3\.
----------------------------------------------------------------------------------------------------------------

    Option 3 for the table in paragraph (k)(2):

----------------------------------------------------------------------------------------------------------------
                                         Class I significant      Class II significant    Class III significant
            Averaging time                  impact levels            impact levels            impact levels
----------------------------------------------------------------------------------------------------------------
Annual...............................  0.06 [mu]g/m\3\........  0.3 [mu]g/m\3\.........  0.3 [mu]g/m\3\.
24-hour..............................  0.07 [mu]g/m\3\........  1.2 [mu]g/m\3\.........  1.2 [mu]g/m\3\.
----------------------------------------------------------------------------------------------------------------

* * * * *
    (p) * * *
    (5) * * *
    Option 1 for the table in paragraph (p)(5):

------------------------------------------------------------------------
                                                              Maximum
                                                             allowable
                                                             increase
                        Pollutant                           (micrograms
                                                             per cubic
                                                              meter)
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean..............................               4
    24-hr maximum.......................................               9
PM10:
    24-hr maximum.......................................              30
Sulfur dioxide:
    Annual arithmetic mean..............................              20
    24-hr maximum.......................................              91
    3-hr maximum........................................             325
Nitrogen dioxide:
    Annual arithmetic mean..............................              25
------------------------------------------------------------------------

    Option 2 for the table in paragraph (p)(5):

------------------------------------------------------------------------
                                                              Maximum
                                                             allowable
                                                             increase
                        Pollutant                           (micrograms
                                                             per cubic
                                                              meter)
------------------------------------------------------------------------
PM2.5:
    Annual arithmetic mean..............................               4
    24-hr maximum.......................................               9
PM10:
    24-hr maximum.......................................              30
Sulfur dioxide:
    Annual arithmetic mean..............................              20
    24-hr maximum.......................................              91
    3-hr maximum........................................             325
Nitrogen dioxide:
    Annual arithmetic mean..............................              25
------------------------------------------------------------------------

    Option 3 for the table in paragraph (p)(5):

------------------------------------------------------------------------
                                                              Maximum
                                                             allowable
                                                             increase
                        Pollutant                           (micrograms
                                                             per cubic
                                                              meter)
------------------------------------------------------------------------
PM2.5:

[[Page 54156]]


    Annual arithmetic mean..............................               5
    24-hr maximum.......................................               9
PM10:
    24-hr maximum.......................................              30
Sulfur dioxide:
    Annual arithmetic mean..............................              20
    24-hr maximum.......................................              91
    3-hr maximum........................................             325
Nitrogen dioxide:
    Annual arithmetic mean..............................              25
------------------------------------------------------------------------

* * * * *

 [FR Doc. E7-18346 Filed 9-20-07; 8:45 am]

BILLING CODE 6560-50-P
