Draft final rule sent to OMB

November 14, 2007

______________________________

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 94

[EPA-HQ-OAR-2007-0120; FRL_XXXX-X]

RIN 2060-A026

Change in Deadline for Rulemaking to Address the Control of Emissions
from New Marine Compression-Ignition Engines at or Above 30 Liters per
Cylinder

AGENCY:  Environmental Protection Agency (EPA).

ACTION:  Final Rule.

SUMMARY:    SEQ CHAPTER \h \r 1  A February 2003 final rule established
the first U.S. emission standards for new compression-ignition Category
3 marine engines, those with a per-cylinder displacement at or above 30
liters.  It also established a deadline of April 27, 2007 for EPA to
promulgate a second set of emission standards for these engines.  This
rulemaking schedule was intended to allow time to consider the state of
technology for deeper emission reductions and the status of
international action for more stringent standards.  Since 2003 we have
continued to gain a greater understanding of technical issues and assess
the continuing efforts of manufacturers to apply advanced emission
control technologies to these engines.  In addition, we have continued
to work with and through the International Maritime Organization toward
more stringent emission standards that would apply to all new marine
diesel engines on ships engaged in international transportation.  Much
of the information necessary to develop more stringent Category 3 marine
diesel engines standards has become available only recently and we
expect more information to come to light in the course of the current
negotiations underway as part of the international process.  EPA is
therefore adopting a new deadline for the rulemaking to consider the
next tier of Category 3 marine diesel engine standards.  Under this new
schedule, EPA would adopt a final rule by December 17, 2009.

 

DATES:    SEQ CHAPTER \h \r 1 This rule is effective on [Insert date 60
days from date of publication in the Federal Register]. 

ADDRESSES:  All documents in the docket are listed in the   HYPERLINK
"http://www.regulations.gov"  www.regulations.gov  index under Docket ID
No. EPA-HQ-OAR-2007-0120.  Some information listed in the index is not
publicly available, such as confidential business information or other
information for which 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   HYPERLINK "http://www.regulations.gov" 
www.regulations.gov  or in hard copy at the EPA Docket Center, EPA/DC,
EPA West, Room 3334, 1301 Constitution Avenue, NW., Washington, DC. The
Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through
Friday, excluding legal holidays. The telephone number for the Public
Reading Room is (202) 566-1744, and the telephone number for the Air
Docket is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: Michael Samulski, Assessment and
Standards Division, Office of Transportation and Air Quality, 2000
Traverwood Drive, Ann Arbor, MI, 48105; telephone number:  (734)
214-4532;  fax number: (734) 214-4050; email address:     HYPERLINK
"mailto:larson.robert@epa.gov."  samulski.michael@epa.gov .

  SEQ CHAPTER \h \r 1 SUPPLEMENTARY INFORMATION:

I.   Does This Action Apply to Me?

	This action will affect companies that manufacture, sell, or import
into the United States new marine compression-ignition engines for use
on vessels flagged or registered in the United States; companies and
persons that make vessels that will be flagged or registered in the
United States and that use such engines; and the owners or operators of
such U.S. vessels.  This action may also affect companies and persons
that rebuild or maintain these engines.  Affected categories and
entities include the following:

Category	NAICS Codea	Examples of potentially affected entities

Industry	333618	Manufacturers of new marine diesel engines.

Industry	336611	Manufacturers of marine vessels.

Industry	811310	Engine repair and maintenance.

Industry	483	Water transportation, freight and passenger.

a North American Industry Classification System (NAICS)

	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 particular activities may be affected by
this action, you should carefully examine the regulations.  You may
direct questions regarding the applicability of this action as noted in
FOR FURTHER INFORMATION CONTACT.

I. Background

	EPA published the intended change in the rulemaking schedule for
Category 3 marine diesel engines as a direct final rule (72 FR 20948,
April 27, 2007).  We received adverse comments from six state and
non-governmental organizations.  As a result, we retracted the direct
final rule and are proceeding with the rulemaking based on the proposal
that was published concurrent with the direct final rule.  Comments
received on the direct final rule are therefore considered to be
comments on the concurrent proposed rule.  In this action we are
announcing our decision to change the regulatory deadline as intended
and responding to those comments.

II. Summary of the Rule

	In this final rule we are extending the regulatory deadline for issuing
a final rule setting more stringent standards for Category 3 marine
diesel engines to December 17, 2009.  This additional time will allow us
to better address significant remaining concerns about the emission
control technologies and create a compliance program that ensures proper
implementation of new standards.  This approach will allow us to set
standards that achieve the maximum emission reductions from these
engines.  We do not believe this extension will delay emission
reductions from Category 3 marine diesel engines beyond what could be
achieved by setting standards sooner.  Instead, it creates the
opportunity for the development and implementation of a more effective
program for the longer term.  Finally, this delay will allow us to take
advantage of information that is being prepared for consideration by the
International Maritime Organization as part of the ongoing negotiations
to amend MARPOL Annex VI under the International Convention for the
Prevention of Pollution from Ships.

III. Basis for the Rule

A.  History of EPA’s Category 3 Standards

	In February 2003, we adopted standards for new marine diesel engines
with per- cylinder displacement at or above 30 liters per cylinder (also
called Category 3 marine diesel engines; see 68 FR 9746, February 28,
2003).  The program consisted of a two-part approach.  First, we adopted
near-term Tier 1 standards that went into effect in 2004 and were based
on readily available control technology.  Those standards are identical
to the international standards adopted at the International Maritime
Organization in MARPOL Annex VI.  Second, we adopted regulations that
set a schedule for a future rulemaking to assess and adopt an
appropriate second tier of standards.  We explained that it was
appropriate to defer a final decision on the longer-term Tier 2 standard
to a future rulemaking because there were several outstanding technical
issues concerning the widespread commercial use of advanced control
technologies on engines of this size.  We highlighted the following
concerns in the 2003 final rule:

Selective catalytic reduction has been widely used in stationary
applications with recent efforts to use this technology for marine
applications.  We expressed concerns that these systems may not be
capable of working effectively during the low-speed and light-load
operation typical of operation closest to port areas where emission
control is most important.  We also noted that this approach could lead
to increased emissions of PM, especially direct sulfate PM.  There was
also a concern that high fuel sulfur levels could lead to premature wear
of catalyst materials.

Various approaches for adding water to the combustion event were also
cited as possible approaches to reduce NOx emissions by 50 to 80
percent.  There were concerns that adding water could increase engine
wear with its low lubricity and increase PM emissions (by decreasing
combustion temperatures).  We also noted that new approaches to adding
water-- humidification and steam injection -- held promise for
substantially greater control of NOx emissions.

We raised several questions related to implementation and compliance
provisions that would be appropriate with a new set of standards.  For
example, we need to develop an effective approach to address off-cycle
emissions and uncertainties related to test-fuel specifications and PM
measurement methods relative to the high sulfur concentrations typical
of in-use fuels.  We also raised the possible need to create a
compliance program that would allow for emission controls to be disabled
for operation on the open ocean and restored upon entry into some
defined boundary representing U.S. coastal waters.  These issues are
complicated and need time for resolution.

	We expected new information to become available with respect to (1) new
developments as manufacturers continue to make various improvements with
respect to emission aftertreatment; (2) data or experience from recently
initiated in-use installations using advanced technologies; and (3)
information from longer-term in-use experience that would be helpful for
evaluating the long-term durability of emission controls.  

	The revision of the deadline for Tier 2 of the standards for new
Category 3 marine diesel engine standards is permitted by the Clean Air
Act.  Clean Air Act section 213(a)(3) requires EPA to adopt and
periodically revise regulations that contain standards concerning
certain pollutants reflecting the greatest degree of emission reductions
achievable through the application of technology that will be available,
taking into consideration the availability and costs of the technology,
and noise, energy, safety factors and existing motor vehicle standards. 
EPA’s strategy toward achieving the maximum level of emission control
from Category 3 marine diesel engines is consistent with those statutory
requirements.  See Bluewater Network v. EPA. [cite]. 

B.  Need for Revised Schedule

	Deferring the Tier 2 standards to a second rulemaking has allowed us to
obtain more information on the implementation of advanced technologies. 
Toward that end, we recently published an Advance Notice of Proposed
Rulemaking in which we describe the new information and our current
thinking with regard to potential new requirements for Category 3 marine
diesel engines (cite...).   This new information comes from field
experiences related to the continuing pilot projects to test new
technologies, several recently published technical papers, and ongoing
negotiations in the context of developing MARPOL Annex VI standards. 
This includes a better understanding of the capabilities and constraints
associated with selective catalytic reduction, the potential for
seawater scrubbers to control PM emissions, and the possibility of
relying on the use of distillate fuel as a part of the overall approach
to reducing emissions.  For example, it appears that selective catalytic
reduction can be quite tolerant of high fuel sulfur levels, but reactors
would need to be physically larger to avoid sulfur-related problems. 
Also, pairing selective catalytic reduction with oxidation catalysts
allows for reactivity at substantially lower exhaust temperatures.  This
would help to address the concern for controlling emission at light
engine loads. 

	As we prepare a proposed rule to set standards based on advanced
emission control technologies, we intend to resolve remaining questions
for crafting a complete set of requirements.  This will include
consideration of testing requirements that reflect the need for engines
using selective catalytic reduction to control emissions at light engine
loads typical of operation in port areas.  We will also consider whether
further technological developments with selective catalytic reduction
and water-based technologies will allow us to pursue PM emission
standards more stringent than we are currently contemplating.  

	Control of PM and SOx emissions depends on a combination of using
distillate fuel and adding seawater scrubbers for removing emissions
from engines that burn residual fuel.  EPA will be separately pursuing
the appropriate designations under MARPOL Annex VI such that all vessels
would need to either use distillate fuel or achieve an equivalent level
of emission control with seawater scrubbers.  We intend to address
certification requirements for seawater scrubbers in the rulemaking
proposal for setting emission standards for Category 3 marine diesel
engines. In addition, the proposal will address remaining questions for
applying such standards to the current fleet in addition to new vessels,
and for disposing of emissions removed from the exhaust gases, including
the possible negative impacts on water quality for discharged
wastewater.

	The proposed rule will also rely on development and use of new analytic
tools to assess the costs and benefits of alternative emission control
strategies, especially related to at-sea emissions and how they are
transported to shore.

	Additional time will also allow us to take advantage of the ongoing
negotiations for amendments to MARPOL Annex VI.  When we finalized our
Tier 1 standards in 2003, we anticipated that negotiations for the next
round of international standards would begin shortly thereafter.  Due to
many delays, Members of the Convention did not agree to begin
negotiations until July 2006, and the first round of negotiations did
not occur until November 2006.  These negotiations are expected to
conclude in October 2008.  These negotiations provide a key forum for
sharing information on the performance of current installations.  In
addition, the IMO Secretary General has commissioned an experts group to
examine control alternatives for PM and SOx emissions; this information
will also be important for developing the national standards.  EPA is
involved in these negotiations as a member of the U.S. delegation to
IMO. 

	All these rulemaking issues are described in more detail in the Advance
Notice of Proposed Rulemaking.

C.  New Schedule

	EPA remains committed to developing and proposing Tier 2 emission
standards for Category 3 marine diesel engines.  Advanced technology
solutions are available or under development for these engines. 
However, it is necessary to resolve the questions described above before
we are ready to propose a program with appropriate Tier 2 emission
standards for these engines.

	Our commitment to Tier 2 standards is evidenced by our position at the
IMO and in the recently published Advance Notice or Proposed Rulemaking.
 Specifically, as part of the process for setting new emission standards
under IMO, the United States submitted a paper to the April 2007 BLG
Sub-Committee meeting (called BLG-11) setting out an approach for
substantially reducing emissions from marine diesel engines.    If
adopted, these standards could achieve significant reductions in NOx,
particulate matter (PM), and oxides of sulfur (SOx) emissions from
marine vessels.  This framework formed the basis of the approach we are
currently pursuing for an EPA rulemaking under the Clean Air Act to
establish Tier 2 standards for Category 3 marine diesel engines, as
described in the Advance Notice of Proposed Rulemaking.  We expect the
information we receive during this international process and as comments
on the Advance Notice to provide very useful information in addressing
our remaining concerns. 

	We do not believe this extension will delay emission reductions from
Category 3 marine diesel engines beyond what could be achieved by
setting standards sooner.  If we would adopt emission standards earlier,
we would need to allow several years of lead time to give manufacturers
opportunity to work out remaining technological issues in designing
engines with advanced emission control technologies for all sizes and
types of vessels.  Manufacturers have continued to make progress in
developing these technologies in the meantime, which will help us tailor
requirements to what emission reductions are achievable and should allow
us to adopt a program with shorter lead time relative to the final rule
setting these emission standards.  Any foregone emission reductions from
delaying the implementation of emission standards would likely be offset
by our ability to set more stringent standards based on the additional
information that is available by setting standards at the later date.

	In sum, the delay in issuing the final rule for more stringent emission
standards for Category 3 marine diesel engines is reasonable given the
need to address certain technical issues and collect further
information.  We believe there will be no significant foregone emission
reductions resulting from the delayed rulemaking schedule.  In contrast,
the additional time allows the opportunity to develop and implement a
more effective program for the longer term.  

	In recognition of the current situation, we are taking this action to
establish a new rulemaking deadline that will facilitate our ability to
adopt emission standards consistent with the statutory directive, while
advocating adoption of the same controls as part of the international
process.  In this action we are adopting a new deadline of December 17,
2009 for a final rule that will address additional emission standards
for Category 3 marine diesel engines as appropriate under section
213(a)(3) of the Clean Air Act. 

IV. Summary and Analysis of Comments

A. Summary of Comments

	Commenters pointed out that Category 3 marine diesel engines are
significant and growing contributors to air pollution in the United
States.  This included reference to various EPA estimates and was
supplemented by several estimates for specific areas.  Several
commenters pointed out the acute need for reduced emissions from these
engines in California, particularly in the South Coast Air Basin.  For
example, over half of current or projected levels of SOx and diesel PM
emissions in the South Coast Air Basin are estimated to come from marine
vessels (or all port-related sources).  SOx emissions from marine
vessels in particular would need to be reduced by about 90 percent in
the next few years for the South Coast Air Basin to reach timely
attainment of the air quality standard for PM2.5.  The South Coast Basin
is also home to the Ports of Los Angeles and Long Beach, which are
claimed to be the entry point for 40 percent of the nation’s goods,
with cargo throughput projected to triple by 2025.  Santa Barbara
County, California was noted as another particular concern, where 75
percent of local NOx emissions are projected to come from marine
vessels, even though there are no commercial ports within county
boundaries.  One commenter referenced a finding that 70 percent of
global shipping emissions occur within 400 kilometers of shore, where
pollution transport may range from 400 to 1200 kilometers inland.

	Commenters emphasized that the emissions from Category 3 marine diesel
engines contribute to serious public health and environmental problems. 
Commenters cited the EPA finding that diesel exhaust is a likely human
carcinogen.  Diesel particulate matter, ozone, SOx, and air toxic
emissions were identified as substantial causes of environmental
degradation, illness, and/or death.  Commenters noted that emissions
from marine diesel engines also raise concerns for environmental
justice, since the pollution effects fall disproportionately on the
relatively low-income residential areas surrounding ports and
transportation corridors.

	Commenters cited Clean Air Act section 213 and EPA’s 1994 and 1998
findings to establish the significance of emissions from nonroad engines
in general and Category 3 marine diesel engines specifically as
demonstration that EPA had a mandatory duty to set technology-forcing
emission standards for these engines.  Commenters further maintained
that missing the regulatory deadline violated EPA’s repeated
statements committing to take final action on the schedule reflected in
the regulation.  Commenters noted that in similar circumstances the
District Court of the District of Columbia compelled EPA to take a final
action based on a regulatory deadline EPA had earlier adopted as part of
the effort to address hazardous air pollutants from motor vehicles. 
Commenters further reasoned that the court decision upholding the
sufficiency of the Tier 1 standards adopted in February 2003 depended on
EPA’s commitment to adopt more stringent emission standards for these
engines by the established deadline. 

	Commenters claimed that delaying implementation of emission standards
based on the need for more time to evaluate potential emission controls
is without merit and outside the scope of EPA’s rulemaking authority. 
Rather, commenters view Clean Air Act section 213 as requiring EPA to
establish technology-forcing standards based on projected future
advances in pollution control capabilities.  Commenters further argue
that the necessary advances for low-emission technologies for these
engines have already occurred and these technologies are widely used in
commercial applications today, and that EPA has provided no reasoned
basis describing why the originally adopted schedule was not sufficient
to address any remaining technical concerns related to emission control
technologies.  For example, commenters cited EPA’s report of more than
300 marine engines operating worldwide with selective catalytic
reduction, including oceangoing vessels.  Some commenters also disagreed
with the logic of EPA’s argument that setting intermediate-stringency
standards would prevent more effective long-term standards, noting
Congress’s intent for periodic review and update of nonroad emission
standards to reflect the evolutionary nature of emission control
technology.  Commenters also pointed out that more stringent emission
control are urgently needed, given the large number of ships expected to
be built in over the coming years and the difficulty of retrofitting
vessels to reduce emissions.

	Commenters also posit that it is impermissible and inappropriate for
EPA to allow international negotiations to nullify its obligations under
the Clean Air Act.  Commenters point out that Clean Air Act section 213
does not allow for foreign-policy considerations to serve as the basis
for determining whether or how to set emission standards for nonroad
engines, and that the Supreme Court recently reinforced this principle
in the decision related to greenhouse gas emissions.  This was presented
as an inappropriate means of shifting power from the Congress to the
Executive Branch.  Commenters further maintain that EPA has failed to
explain how emission standards adopted for the United States under the
Clean Air Act would hamper international negotiations (or how the
specific and feasible standards EPA has recommended for consideration at
IMO lack information needed for pursuing standards under U.S. law). 
They emphasized other examples of international agreements that followed
implementation of domestic regulations in the United States, and argued
that the delays in adoption of international standards for marine diesel
engines were in fact a basis for EPA to pursue separate requirements. 
Aside from a general skepticism that the IMO process would lead to
meaningful emission reductions from these engines, commenters promoted
the contrary view that rigorous U.S. emission standards would provide
the political and technical foundation for international action
regarding Category 3 marine diesel engines, and that EPA has missed out
on an opportunity to demonstrate to the IMO that the United States is
serious about reducing emissions from large marine vessels and will act
unilaterally if the IMO does not.  Commenters recommended that EPA
pursue emission standards based on the recent U.S. proposal for
consideration under the IMO process.

	Commenters noted that the decision to delay the deadline for setting
new emission standards also postpones EPA’s promised decision
regarding the authority to apply U.S. emission standards to engines on
foreign-flagged vessels.  Commenters also made the following arguments
to emphasize that EPA should decide affirmatively to apply emission
standards to engines on foreign-flagged vessels:

Clean Air Act section 213 requires EPA to set emission standards for all
classes of nonroad engines that contribute to air pollution in the
United States, without distinguishing between domestic and foreign
engines.

EPA has repeatedly acknowledged that foreign-flagged vessels account for
the clear majority of emissions from Category 3 marine diesel engines.

Court decisions have established that foreign-flagged vessels in U.S.
ports and water are subject to U.S. regulations other than those
pertaining to a ship’s “internal management and affairs.”  

International law explicitly protects the right of the U.S. to regulate
foreign-flagged ships in U.S. ports and waters. 

As described above for emission standards, the court upheld EPA’s
refusal to decide whether to regulate foreign flagged vessels on the
basis that EPA promised to address the issue in its 2007 rulemaking.

	Commenters concluded by emphasizing their interest in seeing EPA
establish and commit to a firm and timely deadline to develop and
implement stringent emission standards for Category 3 marine diesel
engines, with rulemaking and implementation schedules expedited as much
as possible to address EPA’s legal obligations and the compelling air
quality needs associated with these standards.

B. Analysis of Comments

	We are mindful of the extent to which Category 3 marine diesel engines
contribute to air pollution in coastal and inland areas of the United
States.  We do not disagree with the characterization of the emission
contribution or health and environmental impacts described by
commenters.

	However, we believe that amending the regulatory deadline to allow more
time to address several remaining technical issues and collect some
additional information is reasonable and consistent with our authority
under the statute.  The February 2003 final rule fulfilled our statutory
obligation under Clean Air Act section 213 to set standards for Category
3 marine diesel engines.   In Bluewater Network v. EPA  [cite], the
Court upheld EPA’s rulemaking as having met the statutory requirement
to establish standards that achieve the greatest degree of emission
reduction.  As a result, we disagree with the comments suggesting that
we have failed to meet our mandatory statutory duty to set emission
standards.  

	We set a schedule for producing a new rulemaking to adopt more
stringent emission standards by April 2007 but have found that this did
not allow sufficient time for completion, as described above.  This
delay is reasonable in light of these issues and is consistent with
Congress’ intent that EPA consider the availability of technologies
that can achieve the desired reductions, as well as the necessary  lead
time, cost, noise, energy and safety issues with adopting such
standards.  

	As part of the process for setting new emission standards under IMO,
the United States submitted a paper to the April 2007 BLG Sub-Committee
meeting (called BLG-11) setting out an approach for substantially
reducing emissions from marine diesel engines.  In parallel with this
development toward a new set of international standards, we have
initiated a rulemaking under the Clean Air Act to adopt these standards
for the United States by publishing an Advance Notice of Proposed
Rulemaking.  

	We believe there has been great progress toward establishing the
feasibility of controlling NOx, SOx, and PM emissions from these
engines.  Laboratory and in-field pilot demonstrations have
significantly advanced the development of emission control technologies
and allowed for relatively near-term projections for deploying these
technologies in commercial service.  These developments have allowed us
to advocate specific emission targets as participating members of IMO in
the effort to adopt more stringent emission standards.  These targets
also were the basis of our Advance Notice of Proposed Rulemaking.  As
described in the Advance Notice, we are still concluding resolution of
the technological issues described above.  We also expect to receive
information through the international process and as comment on the
Advance Notice of Proposed Rulemaking to help us address these remaining
concerns.

	While we are supporting the efforts in an international forum to set
global emission standards, we are not deferring to that process in
pursuing emission standards under the Clean Air Act.  By initiating our
own rulemaking to set new emission standards, we are pursuing an
approach in which harmonized U.S. and global standards would be
developed in parallel.  While we are mindful of the timing of the
international process and the state of these negotiations, the reasons
described above for taking additional time to adopt a new round of
emission standards hinge on the factors specified by Congress for
considering the timing for implementing new emission standards,
especially for the feasibility, lead time, and costs associated with new
emission controls.  

	Regarding the question of applying emission standards to
foreign-flagged vessels, we understand the positions expressed by
commenters, as well as the contrary views expressed by commenters in
previous rulemaking activity, and will be taking these concerns into
account as we pursue a decision on this issue, which we will describe
with supporting rationale in the proposal for setting emission standards
for these engines.

	The Advance Notice of Proposed Rulemaking is the next step toward
developing more stringent emission standards for Category 3 marine
diesel engines under the Clean Air Act.  We intend to pursue these
aggressive emission reductions, both in the EPA rulemaking and in the
international process.  The revised regulatory deadline included in this
final rule indeed reflects a delay from the original April 2007 target,
but we believe the revised schedule will allow for a thorough
consideration of a wide range of important issues that need to be
addressed before we can adopt an appropriate set of requirements for
these engines.  We continue to believe that pursuing resolution of these
issues in an EPA rulemaking in parallel with the ongoing international
negotiations will be the best path to leverage the most effective
program for reducing the emissions impact from Category 3 marine diesel
engines on U.S. air quality.

V.  Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review 

	Under section (3)(f)(1) Executive Order 12866 (58 FR 51735, October 4,
1993), the Agency must determine whether the regulatory action is
“significant” and therefore subject to review by the Office of
Management and Budget (OMB) and the requirements of this Executive
Order.  This final rule has been sent to 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 

	This action does not impose any new information collection burden. 
This final rule merely changes the regulatory schedule for a rulemaking
to address emissions from Category 3 marine diesel engines.  However,
the Office of Management and Budget (OMB) has previously approved the
information collection requirements contained in the existing
regulations in 40 CFR 94 under the provisions of the Paperwork Reduction
Act, 44 U.S.C. 3501 et seq. and has assigned OMB control number
2060-0287, EPA ICR number 1684.10.  A copy of the OMB approved
Information Collection Request (ICR) may be obtained from Susan Auby,
Collection Strategies Division; U.S. Environmental Protection Agency
(2822T); 1200 Pennsylvania Ave., NW, Washington, DC 20460 or by calling
(202) 566-1672. 

	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. 

  

	An agency may not conduct or sponsor, and a person is not required to
respond to a collection of information unless it displays a currently
valid OMB control number. The OMB control numbers for EPA's regulations
in 40 CFR are listed in 40 CFR part 9. 

C. Regulatory Flexibility Act

	The Regulatory Flexibility Act (RFA) generally requires an agency to
prepare a regulatory flexibility analysis of any rule subject to notice
and comment rulemaking requirements under the Administrative Procedures
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 final rule on small
entities, a small entity is defined as: (1) A small business that meet
the definition for business based on SBA size standards at 13 CFR
121.201; (2) a small governmental jurisdiction that is a government of a
city, county, town, school district or special district with a
population of less than 50,000; and (3) a small organization that is any
not-for-profit enterprise which is independently owned and operated and
is not dominant in its field.  

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

	This final rule merely changes the regulatory schedule for a rulemaking
to address emissions from Category 3 marine engines.  We have therefore
concluded that this final rule will relieve regulatory burden for all
affected small businesses.

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, EPA
generally must prepare a written statement, including a cost-benefit
analysis, for proposed and final rules with “federal mandates” that
may result in expenditures to state, local, and tribal governments, in
the aggregate, or to the private sector, of $100 million or more in any
one year. Before promulgating an EPA rule for which a written statement
is needed, section 205 of the UMRA generally requires EPA to identify
and consider a reasonable number of regulatory alternatives and to adopt
the least costly, most cost-effective, or least burdensome alternative
that achieves the objectives of the rule. The provisions of section 205
do not apply when they are inconsistent with applicable law. Moreover,
section 205 allows EPA 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 of why such
an alternative was adopted. 

	Before EPA establishes any regulatory requirements that may
significantly or uniquely affect small governments, including tribal
governments, it 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 EPA regulatory proposals with significant federal intergovernmental
mandates, and informing, educating, and advising small governments on
compliance with the regulatory requirements. 

	This rule contains no federal mandates for state, local, tribal
governments, or the private sector as defined by the provisions of Title
II of the UMRA. The rule imposes no enforceable duties on any of these
governmental entities. This rule contains no regulatory requirements
that would significantly or uniquely affect small governments. EPA has
determined that this rule contains no federal mandates that may result
in expenditures of more than $100 million to the private sector in any
single year.  This final rule merely changes the regulatory schedule for
a rulemaking to address emissions from Category 3 marine engines.  This
rule is not subject to the requirements of sections 202 and 205 of UMRA.

E. Executive Order 13132: Federalism 

	Executive Order 13132, entitled “Federalism” (64 FR 43255, August
10, 1999), requires EPA to develop an accountable process to ensure
“meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications.”
“Policies that have federalism implications” are defined in the
Executive Order to include regulations that have “substantial direct
effects on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government.” 

	Under Section 6 of Executive Order 13132, EPA may not issue a
regulation that has federalism implications, that imposes substantial
direct compliance costs, and that is not required by statute, unless the
Federal government provides the funds necessary to pay the direct
compliance costs incurred by State and local governments, or EPA
consults with State and local officials early in the process of
developing the regulation. EPA also may not issue a regulation that has
federalism implications and that preempts State law, unless the Agency
consults with State and local officials early in the process of
developing the regulation. 

	Section 4 of the Executive Order contains additional requirements for
rules that preempt State or local law, even if those rules do not have
federalism implications (i.e., the rules will not have substantial
direct effects on the States, on the relationship between the national
government and the states, or on the distribution of power and
responsibilities among the various levels of government). Those
requirements include providing all affected State and local officials
notice and an opportunity for appropriate participation in the
development of the regulation. If the preemption is not based on express
or implied statutory authority, EPA also must consult, to the extent
practicable, with appropriate State and local officials regarding the
conflict between State law and Federally protected interests within the
agency's area of regulatory responsibility. 

	This rule does not have federalism implications. It will not have
substantial direct effects on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government, as
specified in Executive Order 13132.  This final rule merely changes the
regulatory schedule for a rulemaking to address emissions from Category
3 marine diesel engines.  Thus, Executive Order 1312 does not apply to
this rule.

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

	Executive Order 13175, entitled “Consultation and Coordination with
Indian Tribal Governments” (59 FR 22951, November 6, 2000), requires
EPA to develop an accountable process to ensure “meaningful and timely
input by tribal officials in the development of regulatory policies that
have tribal implications.” “Policies that have tribal
implications” is defined in the Executive Order to include regulations
that have “substantial direct effects on one or more Indian tribes, on
the relationship between the Federal government and the Indian tribes,
or on the distribution of power and responsibilities between the Federal
government and Indian tribes.” 

	This rule does not have tribal implications. It will not have
substantial direct effects on tribal governments, on the relationship
between the Federal government and Indian tribes, or on the distribution
of power and responsibilities between the Federal government and Indian
tribes, as specified in Executive Order 13175. This rule does not
uniquely affect the communities of Indian Tribal Governments. Further,
no circumstances specific to such communities exist that would cause an
impact on these communities beyond those discussed in the other sections
of this rule. This final rule merely changes the regulatory schedule for
a rulemaking to address emissions from Category 3 marine engines.  Thus,
Executive Order 13175 does not apply to this rule. 

G. Executive Order 13045: Protection of Children from Environmental
Health and Safety Risks 

	Executive Order 13045, “Protection of Children from Environmental
Health Risks and Safety Risks” (62 FR 19885, April 23, 1997) applies
to any rule that (1) is determined to be “economically significant”
as defined under Executive Order 12866, and (2) concerns an
environmental health or safety risk that EPA has reason to believe may
have a disproportionate effect on children. If the regulatory action
meets both criteria, Section 5-501 of the Order directs the Agency to
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 rule is not subject to the Executive Order because it is not
economically significant as defined in EO 12866, and because the Agency
does not have reason to believe the environmental health or safety risks
addressed by this action present a disproportionate risk to children. 
This final rule merely changes the regulatory schedule for a rulemaking
to address emissions from Category 3 marine diesel engines.

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.  This final
rule merely changes the regulatory schedule for a rulemaking to address
emissions from Category 3 marine engines.

I. National Technology Transfer and Advancement Act 

	Section 12(d) of the National Technology Transfer and Advancement Act
of 1995 (“NTTAA”), Public Law 104-113, section 12(d) (15 U.S.C. 272
note) directs EPA to use voluntary consensus standards in its regulatory
activities unless doing so would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (such as materials specifications, test methods, sampling
procedures, and business practices) that are developed or adopted by
voluntary consensus standards bodies. NTTAA directs EPA to provide
Congress, through OMB, explanations when the Agency decides not to use
available and applicable voluntary consensus standards. 

	This final rule does not involve technical standards.  This final rule
merely changes the regulatory schedule for a rulemaking to address
emissions from Category 3 marine engines.  Therefore, EPA did not
consider the use of any voluntary consensus standards.

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

	Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
federal executive policy on environmental justice.  Its main provision
directs federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission by
identifying and addressing, as appropriate, disproportionately high and
adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.  

	EPA has determined that this rule will not have disproportionately high
and adverse human health or 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 final rule
merely changes the regulatory schedule for a rulemaking to address
emissions from Category 3 marine diesel engines.

K.	Congressional Review Act

	The Congressional Review Act, 5 U.S.C. 801 et seq., as amended by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating the
rule must submit a rule report, which includes a copy of the rule, to
Congress and the Comptroller General of the United States. We will
submit a report containing this rule and other required information to
the U.S. Senate, the U.S. House of Representatives, and the Comptroller
General of the United States before publication of the rule in the
Federal Register. A major rule cannot take effect until 60 days after it
is published in the Federal Register.  This action is not a “major
rule” as defined by 5 U.S.C. 804(2). This final rule is effective on
[insert 60 days after Federal Register publication].

L. 	Statutory Authority

	The statutory authority for this action comes from section 213 of the
Clean Air Act as amended (42 U.S.C. 7547).  This action is a rulemaking
subject to the provisions of Clean Air Act section 307(d).  See 42
U.S.C. 7607(d).

List of Subjects in 40 CFR Part 94

Environmental protection, Administrative practice and procedure, Air
pollution control, Confidential business information, Imports,
Penalties, Reporting and recordkeeping requirements, Vessels,
Warranties.

Dated:		

										

___________________________________________________

Stephen L. Johnson,

Administrator.

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

PART 94—CONTROL OF AIR POLLUTION FROM MARINE COMPRESSION –IGNITION
EMISSIONS

1.  The authority citation for part 94 continues to read as follows:

Authority: 42 U.S.C. 7401-7671q.

2.	Section 94.8 is amended by revising paragraph (a)(2)(ii) to read as
follows:

§94.8  Exhaust emission standards.

(a)  *	*	* 

(2)  *	*	*

(ii)  EPA has not finalized Tier 2 standards for Category 3 engines. 
EPA will promulgate final Tier 2 standards for Category 3 engines on or
before December 17, 2009.

*	*	*	*	*

 “Revision of the MARPOL Annex VI, the NOx Technical Code and Related
Guidelines; Development of Standards for NOx, PM, and SOx,” submitted
by the United States, BLG 11/5, Sub-Committee on Bulk Liquids and Gases,
11th  Session, Agenda Item 5, February 9, 2007, Docket ID
EPA-HQ-OAR-2007-0121-0034.  This document is also available on our
website:    HYPERLINK "http://www.epa.gov/otaq/oceanvessels.com" 
www.epa.gov/otaq/oceanvessels.com  

 “Revision of MARPOL Annex VI, The NOx Technical Code and Related
Guidelines; Development of Standards for NOx, PM, and SOx,” Submitted
by the United States to the Sub-Committee on Bulk Liquids and Gases,
11th Session, 2007.

 “Revision of the MARPOL Annex VI, the NOx Technical Code and Related
Guidelines; Development of Standards for NOx, PM, and SOx,” submitted
by the United States, BLG 11/5, Sub-Committee on Bulk Liquids and Gases,
11th  Session, Agenda Item 5, February 9, 2007, Docket ID
EPA-HQ-OAR-2007-0121-0034.  This document is also available on our
website:    HYPERLINK "http://www.epa.gov/otaq/oceanvessels.com" 
www.epa.gov/otaq/oceanvessels.com  

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